Circuit City forms deals with WCM, Blockbuster

RICHMOND, Va. Circuit City Stores has reached an agreement with Wattles Capital Management, allowing for the inclusion of three WCM nominees, chosen by the Circuit City board, at the company's annual meeting. In addition, one of the WCM nominees will become a member of the executive committee of the Circuit City board.

In turn WCM has agreed not to solicit proxies in connection with the 2008 annual meeting; to vote its shares in support of all of the board's director nominees at the 2008 annual meeting; and to abide by certain confidentiality and standstill provisions through the completion of the 2009 annual meeting.

Circuit City also announced that it has retained Goldman Sachs & Co. to assist the company in exploring strategic alternatives to enhance shareholder value. In addition it confirmed that it had received a letter from Blockbuster detailing its ability to finance its proposal to acquire Circuit City and as such has agreed to let them conduct further due diligence, subject to customary confidentiality arrangements.