2 Circuit City leaders out

By LOUIS LLOVIO
RICHMOND TIMES-DISPATCH
Published: March 7, 2008

The departure of two high-level executives at Circuit City Stores Inc. had nothing to do with recent rumblings from disgruntled shareholder Mark Wattles, a company spokesman said.

The Henrico County-based chain confirmed yesterday that two executives lost their jobs “as part of a restructuring.“

Peter Weedfald, chief marketing officer, and Steven P. Pappas, president of the company’s small stores, were let go, according to spokesman Jim Babb.

Weedfald’s last day is today. Pappas’ last day was Saturday. Both men joined the company in 2006.

“It’s not surprising for a company of our size, especially in the midst of a period of transformation, to have changes within its management,“ Babb said. “We are making and will continue to make the organization decisions that we feel will best further our turnaround, our strategies and shareholder value.“

He would not disclose any separation agreements. Because of their termination before 2011, the men will not collect $600,000 retention bonuses.

Yesterday, Babb said the moves had nothing to do with outside influences.

Last week, investor Mark Wattles launched an attack to gain control of the chain. He owns a 6.5 percent stake in the company.

Citing management problems, the president and chief executive of Wattles Capital Management LLC asked shareholders to vote out the retailer’s existing board of directors, repeal all bylaw amendments and require any new bylaws to first get shareholder approval.

Eliminating the amendments could make it easier to take over the company.

The issues will be decided at the company’s annual shareholder meeting June 24.

Calls to Wattles were not returned.

Jeffrey Stone, executive vice president of new business development, will oversee Circuit City’s smaller store format. Called The City, the concept is one the chain is banking its future on. He also will be in charge of the technological assistance group, firedog. Stone joined the company in January from Tivoli Audio LLC.

As for marketing, Babb said the company has the right team in place “to execute the marketing plans that have been put in place for the year.“

He would not say whether the company would replace Weedfald.

Babb also said he was not aware of any other executive departures.

In an e-mail to co-workers Wednesday, Weedfald said he would be “intently focused, full time, seeking my next sales and marketing opportunity.“

Pappas could not be reached for comment.

Circuit City closed down 36 cents at $3.96 yesterday.

Contact Louis Llovio at (804) 649-6348 or .