Reports were made earlier this week that popular California based retailer PacSun could be filing for Chapter 11 bankruptcy.

According to GQ, the company is facing a huge debt of $160 million after sales decreased in the past year by a whopping 90 percent. The popular retailer took to its website to address the company’s future.

In the message written to customers, CEO Gary H. Schoenfeld confirms PacSun will be filing for Chapter 11 bankruptcy. The company has now reached an agreement with Golden Gate Capital which means they will become a private owned company. This could be a positive move for the future of PacSun, as a plan to reorganize and position the retailer for long-term success.