Pacific Sunwear of California Inc fka PSUNQ

[1manband]

They had plenty of money to draw from the golden gate loan. And they would have survived, as they stated to have enough funds for the calendar year, implementing cost reductions and selling the real estate.

I am not sure what part of the situation they were in is not being understood.

Their retail sector crashed. Two of the other major players in the segment went bankrupt before PSUN did. Sales in the segment were the worst in decades, and there was no money to draw because the lenders were no longer making any available. No one was providing money to this sector after Christmas because they knew they would be unlikely to see it again. At that time, bankruptcy became inevitable.

No, they could not sell the real estate. Retail real estate is darn near worthless right now and has been for at least 18 months. The assets on the balance sheet were grossly overstated at the end due to the dramatic changes in the sector. No one wanted what they were selling, and no one wanted the few assets they had. Quiksilver went through the same hell before PSUN did, and that alone should have told any holder in PSUN that they would be wiped out. At least by January, if not before, it should have been pretty obvious PSUN was done and equity holders would be wiped out.