Exhibit 10.1



 




 EXHIBIT 10.1



3450 East Miraloma Avenue, Anaheim, CA 92806-2101

(714) 414-4000

pacsun.com




October 25, 2004




Gerald M. Chaney

125 Deer Trail North

Ramsey, New Jersey 07446




Dear Gerry:




I am extremely pleased to offer you the position of Senior Vice President/Chief
Financial Officer of Pacific Sunwear of California, Inc. (“The Company”). In
this position, you will be part of the Executive Committee of the Company. Your
start date is to be no later than December 2, 2004. The following are points
pertaining to your employment:





	1.	 	Your annual salary will be $550,000. You will be eligible to
receive a performance and salary review for fiscal 2005. Said review
is conducted and is generally effective during March/April 2006, and
annually thereafter.
	 
	2.	 	You will be eligible for our 2005 bonus plan. Any bonus
payments will be made in or around April 2006. Your target bonus
potential is 50% of your salary based on both Company earnings for
the fiscal year and on your individual performance (80% of the
bonus is earnings-related and 20% is discretionary, based on your
individual performance). The Company bonus has a potential upside
of 200% (i.e., 100% of your salary, with the same distribution of
80% based on earnings and 20% based on individual performance). You
must be employed on the date the bonus is paid in order to be
eligible for any part of your bonus. The bonus is calculated based
on the fiscal year’s performance of the Company. The bonus plan can
change in future years.
	 
	3.	 	For fiscal 2004, you will be guaranteed a bonus payment in
the amount of $250,000 irrespective of the Company’s or your
individual performance. Such payment will be made in or around
March/April of 2005.
	 
	4.	 	A recommendation will be made to the Board of Directors to
grant you 100,000 shares of nonqualified stock options at fair
market value on your start date. Options have a four (4) year
vesting, with 25% vested after the first year of service and
subsequent monthly vesting thereafter consistent with an additional
25% vesting per year. In addition, you will be granted 25,000
additional shares of nonqualified stock options at fair market value
at the time annual grants are made to employees, which is in or
around March/April




 









 











Gerald Chaney Offer of Employment

October 25, 2004





	 	 	2005. These options shall have a separate four (4) year vesting
schedule, as described herein.
	 
	5.	 	You will be eligible for a car allowance in the pretax amount
of $7,200 annually, paid on a bi-weekly basis.
	 
	6.	 	You will be eligible for 4 weeks of paid vacation annually
for your first five years of employment and 5 weeks annually
thereafter.
	 
	7.	 	The Company will pay for reasonable and customary expenses in
regard to your move from New Jersey to the Orange County area,
consistent with the terms and conditions of the relocation benefits
provided to executives. Relocation benefits are provided with the
understanding, and a separately signed agreement, that costs
associated with relocation will be reimbursed by you in the event
that you leave the company within one year of employment, other than
if such transition is through no fault of your own.
	 
	8.	 	You have indicated that you are under no contractual
restrictions that would prevent you from accepting employment with
the Company and are free to enter into this employment relationship.





You will be entitled to all other Company benefits provided to executives.
Currently, those benefits include, but are not limited to, medical, dental,
vision, basic and supplemental life and disability insurance. Additionally, we
have available an executive deferred compensation plan with a number of
different investment options. The Company reserves the right to periodically
change benefits.




Gerry, we are extremely excited about the prospect of having you join our
organization. Having you as part of our executive team will add a needed
expertise and perspective that will assure us of the continued success of the
company. We look forward to having your expertise and your impact on the
business.




Sincerely,




/s/ ABBY S. AREINOFF



Abby S. Areinoff

Vice President, Human Resources




I acknowledge receipt and acceptance of the above offer of employment with
Pacific Sunwear of California, Inc. In this capacity, my services would be
exclusively retained by Pacific Sunwear foregoing all previous or future
services elsewhere during my employment by the Company. I understand and
acknowledge that Pacific Sunwear of California, Inc. is an at-will employer and
that my employment may be terminated by the Company or me at any time, with or
without prior notice or cause.




Upon acceptance of the above offer, please forward or fax a signed copy of page

two only to Human Resources at (714) 414-4260.




	 	 	 	 	 	 	 
	Signature:

	 	/s/
	 	GERALD M. CHANEY
	 	Date: November 22, 2004
	 	 	
	 	 
	

	 	 	 	Gerald M. Chaney	 	 








Page 2 of 2