Sponsors
Billabong ▲ +0.005 | PPR ▼ -1.15 | American Apparel ▼ -0.02 | The Buckle ▲ +0.15 | Columbia ▼ -0.14 | Deckers Outdoor ▼ -0.01 | Dicks ▲ +0.83 | Foot Locker ▲ +0.47 | Genesco ▲ +0.74 | Iconix Brand Group ▼ 0.00 | Jarden Corp ▲ +0.37 | Nordstrom ▲ +0.92 | Luxottica ▼ -2.24 | Nike ▲ +0.40 | Pacific Sunwear ▲ +0.05 | Skullcandy ▲ +0.33 | Sport Chalet - 0 | Urban Outfitters ▲ +0.56 | VF Corp ▲ +0.67 | Quiksilver ▼ -0.07 | Zumiez ▲ +0.43 | Macys ▲ +1.14 | Tillys ▲ +0.05 |
Ticker Sponsor
Professional Services
Friedman Stroffe & Gerard, P.C.

FSG’s Action Sports Practice Group provides legal services to the action sports industry. Our clients include surfers, skiers, snowboarders and skaters, as well as sponsors and leading apparel companies. Our attorneys serve in positions with industry organizations such as the Association of Surfing Professionals. We know your business and can provide full-service legal solutions to meet your organizational needs.

More Professional Services...
Readers Say
The one, undisputed leader
The one, undisputed leader

It is common knowledge in our industry that there is one undisputed leader in reporting on the topics, businesses and trends that impact all of us the most, and it is shop-eat-surf.com. Their access to those who make our industry happen is second to none, and we value not only the content of their reporting but the editorial thought on what it all means both in the present as well as the future. If we were asked to give a rating, it would be five out of five stars.

- By Craig Levra, CEO, Sport Chalet
Executive Edition rules
Executive Edition rules

“Shop-Eat-Surf” is now officially, the first stop in the morning for industry news. Accurate reporting, no sensationalism, and just the facts. Refreshing support to an incredible industry with a very bright future. Tiffany has cemented her role in the industry....the site is thought provoking, and inspirational. Learning the stories of others is incredibly useful. Great way to connect the retail community with the wholesale and financial, instantly and nationwide. ... And the Executive Edition rules.

- By Bob Hurley, Chairman, Hurley International
Industry Insight

KNOWSHOW: Video recaps from the Vancouver trade show.

MOSS ADAMS CAPITAL: Geofrey Haydon on the deal that saw the owner of Royal Robbins invest in Evolv.

Details on Industry Insight.


Tiffany Montgomery
Print This Article

Active bankruptcy filing details

By Tiffany Montgomery
March 24, 2009 2:50 PM

Updated 7:30 a.m. Wednesday with names of more skateboarders whose contracts are being rejected and a mention of an Active operating agreement with ESPN for an e-commerce partnership.

I drove out to Riverside this morning and got a copy of Active's Chapter 11 bankruptcy filing in federal court.

Active's top 20 creditorsThe filing tells how Active's rapid expansion over the past few years required significantly more investment and financial resources - while revenues essentially stayed the same.

As result, Active is projected to record a $7.7 million loss for the fiscal year ending March 31. (Click here to read an interview with Active partner Shane Wallace about the bankruptcy filing and go-forward plan, which includes reorganizing and continuing to operate 21 stores).

Also of note is the list of Active's 20 largest unsecured creditors, which reads like a Who's Who of action sports brands. Active owes a total of $8.8 million to its 20 largest unsecured creditors.

Interestingly, only one brand is on the list of secured creditors - the Burton Corporation. Secured creditors get payment priority in a bankruptcy.

Financials

According to the bankruptcy filing, Active's revenues stayed approximately the same over the last few years while the number of stores essentially doubled in that same period.

Annual Revenues

3/31/07: $58.9 million
3/31/08: $61.8 million
3/31/09: $59.9 million (projected)

Annual net income (loss)

3/31/07: $368,356
3/31/08: ($2 million)
3/31/09: ($7.7 million) projected

The filing says, "These losses have been caused primarily by the Debtor's rapid over-expansion and market saturation, during which time the company's same store sales were decreasing substantially."

Bankers

Active owes approximately $4.2 million in principal, exclusive of interest and other charges, to Merrill Lynch, which is continuing to work with the company during its bankruptcy reorganization.

Leases and contracts

The company is moving to reject eight leases for the stores it has already closed in Irvine, San Diego (three), Simi Valley, Westwood, Lake Elsinore and Mission Viejo.

The filing also says it will reject contracts with several skateboarders, including Andrew Reynolds, Kenny Anderson, Billy Marks, Erik Ellington, Daewong Song, Steve Berra, Eric Koston, Michael Capaldi, Braydon Szafranski and Jim Greco.

In addition, Active is rejecting an operating agreement with ESPN for an e-commerce partnership.

 


Articles You Might Have Missed