Circuit City Stores Inc., Richmond, Va., will freeze its $194.3 million pension plan on Feb. 28, according to a filing with the SEC. The company will also increase its matching contribution to the company's $262 million 401(k) plan to 4% from the current maximum of 1.25%, effective Jan. 1. Participants who are within three years of retirement can remain in the pension plan; all other participants will have the option of enrolling in the 401(k) plan.
Steve Mullen, spokesman, said company officials decided to freeze the pension plan in order to reallocate assets to the 401(k) plan, addressing participants' requests for improvements to that plan. The 401(k) offers 11 investment options; Wachovia is bundled provider.