Sponsors
Billabong ▲ +0.010 | PPR ▲ +0.55 | American Apparel ▼ -0.013 | The Buckle ▼ -0.39 | Columbia ▲ +0.09 | Deckers Outdoor ▲ +0.26 | Dicks ▼ -0.02 | Foot Locker ▼ -0.18 | Genesco ▼ -0.06 | Iconix Brand Group ▼ -0.05 | Jarden Corp ▲ +0.15 | Nordstrom ▼ -0.15 | Luxottica ▼ -0.56 | Nike ▲ +0.51 | Pacific Sunwear ▼ -0.05 | Skullcandy ▼ -0.04 | Sport Chalet - 0 | Urban Outfitters ▼ -0.53 | VF Corp ▼ -0.01 | Quiksilver ▼ -0.01 | Zumiez ▼ -0.33 | Macys ▼ -0.37 | 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
Always a good daily read
Always a good daily read

Shop-Eat-Surf creates a good source of timely information about the industry. The site makes all types and size companies feel part of a community where everyone is stoked to hear about other companies successes and ideas. It is always a good daily read.

- By Ted Li, VP of North America, Oakley
Useful on a daily basis
Useful on a daily basis

It's well balanced information that is useful on a daily basis. I'm very satisfied with the Executive Edition. I start each day with SES and a big cup of coffee!

- By Tom Ruiz, EVP Sales, Volcom
Industry Insight

MOSS ADAMS: Webinar 12/2 on internal controls to increase the value of your business.
AGENDA: 12/30 deadline to pre-register for Jan. 5-6 Long Beach show.
CIT TRADE FINANCE: Middle-market retailers cautiously optimistic for holiday.
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