EXHIBIT 10.4

                              SUBSIDIARY GUARANTEE


          THIS  SUBSIDIARY  GUARANTEE  (as  amended  from  time  to  time,  this
"Subsidiary  Guarantee") is made as of the 11th day of June, 1999 by DOLGENCORP,
INC.,  a Kentucky  corporation  ("Dolgencorp"),  DOLGENCORP  OF TEXAS,  INC.,  a
Kentucky  corporation  ("Dolgencorp of Texas"),  DADE LEASE MANAGEMENT,  INC., a
Delaware  corporation  ("Dade"),  DOLLAR  GENERAL  FINANCIAL,  INC., a Tennessee
corporation  ("Dollar  Financial"),  and  DOLLAR  GENERAL  PARTNERS,  a Kentucky
general partnership ("Dollar Partners";  Dolgencorp,  Dolgencorp of Texas, Dade,
Dollar   Financial  and  Dollar  Partners  are   collectively   referred  to  as
"Guarantors"  and  individually as a "Guarantor") in favor of the Agent, for the
ratable benefit of the Funding Parties,  under the Master Agreement  referred to
below;


                                   WITNESSETH:

          WHEREAS,   Dollar   General   Corporation,   a  Kentucky   corporation
("Dollar"),  certain  subsidiaries of Dollar,  Atlantic  Financial  Group,  Ltd.
("Lessor"),  Three Pillars Funding  Corporation  (the "Lender"),  SunTrust Bank,
Nashville,   N.A.  as  agent  (the  "Agent"),  First  Union  National  Bank,  as
Syndication  Agent,  Bank  of  America  National  Trust  and  Savings  Bank,  as
Documentation Agent, The First National Bank of Chicago and Wachovia Bank, N.A.,
as Co-Agents,  the various financial  institutions parties thereto, as Liquidity
Banks, and SunTrust  Equitable  Securities  Corporation,  as Administrator  have
entered into that  certain  Master  Agreement  dated as of June 11, 1999 (as the
same may have been or may  hereafter  be  amended or  supplemented  from time to
time, the "Master  Agreement"),  providing,  subject to the terms and conditions
thereof; for extensions of credit to be made by the Funding Parties to Dollar;

          WHEREAS,  it is a  requirement  of  the  Master  Agreement  that  each
Guarantor  shall  execute and deliver  this  Subsidiary  Guarantee  whereby each
Guarantor shall guarantee the payment when due of all obligations  that shall be
at any time payable by Dollar under the Master Agreement and the other Operative
Documents; and

          WHEREAS,  in  consideration  of the  financial  and other support that
Dollar  provided,  and such  financial  and other  support  as Dollar may in the
future provide,  to each  Guarantor,  each Guarantor is willing to guarantee the
obligations under the Master Agreement and the other Operative Documents.

          NOW, THEREFORE,  in consideration of the premises,  and other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the parties hereto agree as follows:

          SECTION 1. Definitions.  Terms defined in the Master Agreement and not
otherwise  defined herein have, as used herein the respective  meanings provided
for therein.

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          SECTION 2.  Representations and Warranties.  Each Guarantor represents
and warrants (which  representations and warranties shall be deemed to have been
renewed upon each Funding under the Master Agreement) that:

          (a) It (i) is a  corporation  or,  in the case of Dallas  Partners,  a
general  partnership,  duly  organized or formed,  validly  existing and in good
standing under the laws of its  jurisdiction of organization or formation;  (ii)
has  all  requisite   power,  and  has  all  material   governmental   licenses,
authorizations,  consents and approvals necessary to own its assets and carry on
its business as now being or as proposed to be conducted, and (iii) is qualified
to do  business  in all  jurisdictions  in  which  the  nature  of the  business
conducted  by it makes  such  qualification  necessary  and where  failure so to
qualify would have a Materially Adverse Effect.

          (b) It has all necessary  power and authority to execute,  deliver and
perform its obligations under this Subsidiary Guarantee; the execution, delivery
and  performance of this  Subsidiary  Guarantee have been duly authorized by all
necessary organizational action; and this Subsidiary Guarantee has been duly and
validly  executed  and  delivered  by it and  constitutes  its legal,  valid and
binding obligation, enforceable in accordance with its terms.

          (c)  Neither  the  execution  and  delivery  by it of this  Subsidiary
Guarantee nor compliance with the terms and provisions hereof will conflict with
or result in a breach of, or  require  any  consent  under,  its  organizational
documents or any  material  applicable  law or  regulation  or any order,  writ,
injunction or decree of any court or  governmental  authority or agency,  or any
Material  Contractual  Obligation to which it is a party or by which it is bound
or to which it is  subject,  or  constitute  a default  under any such  Material
Contractual Obligation, or result in the creation or imposition of any Lien upon
any of its  revenues  or  assets  pursuant  to the  terms of any  such  Material
Contractual Obligation.

          SECTION 2.02. Covenants.  Each Guarantor covenants that so long as any
Funding Party has any Commitment  outstanding  under the Master Agreement or any
amount payable under the Operative  Documents shall remain unpaid, that it will,
and, if necessary,  will enable Dollar to fully comply with those  covenants and
agreements set forth in the Master  Agreement  (including,  without  limitation,
Section 5 thereof).

          SECTION 3. The  Subsidiary  Guarantee.  Each  Guarantor,  jointly  and
severally,  hereby  unconditionally  guarantees,  the full and punctual  payment
(whether at stated  maturity,  upon  acceleration  or otherwise) of the full and
punctual  payment of all amounts  payable by Dollar under the Master  Agreement,
the Guaranty Agreement and the other Operative  Documents (all of the foregoing,
including without limitation, interest accruing or what would have accrued after
the filing of a petition in bankruptcy  or other  insolvency  proceeding,  being
referred to  collectively  as the  "Guaranteed  Obligations").  Upon  failure by
Dollar to pay  punctually any such amount,  each Guarantor  agrees that it shall
forthwith  on demand  pay the  amount not so paid at the place and in the manner
specified  in the Master  Agreement,  the  Guaranty  Agreement  or the  relevant
Operative Document,  as the case may be. Each Guarantor  acknowledges and agrees
that this is a guarantee of payment when due,  and not of  collection,  and that
this  Subsidiary  Guarantee  may  be  enforced  up to  the  full  amount  of the
Guaranteed  Obligations  without proceeding against Dollar, any other Guarantor,
any security for the  Guaranteed  Obligations,  or against any other Person that

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may have  liability on all or any portion of the  Guaranteed  Obligations.  Each
Guarantor's  obligations under this Subsidiary  Guarantee and the obligations of
any other  Subsidiary  Guarantor  under a  Subsidiary  Guarantee,  are joint and
several.

         SECTION 4. Subsidiary Guarantee Unconditional.  The obligations of each
Guarantor  hereunder shall be  unconditional  and absolute and, without limiting
the generality of the foregoing, shall not be released,  discharged or otherwise
affected by:

                   (i) any extension, renewal, settlement, compromise, waiver or
         release  in  respect  of any  obligation  of Dollar  under  the  Master
         Agreement,  the Guaranty Agreement or any other Operative Document,  by
         operation of law or otherwise or any obligation of any other  guarantor
         of any of the Obligations;

                   (ii) any  modification  or amendment of or  supplement to the
         Master  Agreement,  the  Guaranty  Agreement  or  any  other  Operative
         Document;

                   (iii) any release,  nonperfection or invalidity of any direct
         or indirect  security  for any  obligation  of Dollar  under the Master
         Agreement,  the Guaranty  Agreement or any Operative  Document,  or any
         obligations   of  any  other   guarantor  of  any  of  the   Guaranteed
         Obligations;

                   (iv) any change in the existence,  structures or ownership of
         Dollar or any other guarantor of any of the Guaranteed Obligations,  or
         any insolvency, bankruptcy,  reorganization or other similar proceeding
         affecting Dollar, or any other guarantor of the Guaranteed Obligations,
         or its assets or any resulting  release or discharge of any  obligation
         of Dollar, or any other guarantor of any of the Guaranteed Obligations;

                   (v) the existence of any claim, setoff, or other rights which
         any Subsidiary Guarantor may have at any time against Dollar, any other
         guarantor of any of the Obligations,  the Agent, the Lender, the Lessor
         or any other Person,  whether in  connection  herewith or any unrelated
         transactions,  provided that nothing herein shall prevent the assertion
         of any such claim by separate suit or compulsory counterclaim;

                   (vi)  any  invalidity  or  unenforceability  relating  to  or
         against  Dollar,  or any  other  guarantor  of  any  of the  Guaranteed
         Obligations,  for any  reason  related  to the  Master  Agreement,  the
         Guaranty Agreement,  any other Operative Document,  or any provision of
         applicable  law or  regulation  purporting  to prohibit  the payment by
         Dollar or any other  guarantor of the  Guaranteed  Obligations,  of any
         amount  payable by Dollar  under the  Master  Agreement,  the  Guaranty
         Agreement or any other Operative Document; or

                   (vii) any other act or  omission  to act or delay of any kind
         by Dollar,  any other  guarantor  of the  Guaranteed  Obligations,  the
         Agent,  any  Lender,  the  Lessor  or any  other  Person  or any  other
         circumstance  whatsoever  which might,  but for the  provisions of this
         paragraph,   constitute  a  legal  or   equitable,   discharge  of  any
         Guarantor's obligations hereunder.

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         SECTION  5.  Discharge  Only Upon  Payment  In Full:  Reinstatement  In
Certain  Circumstances.  Each Guarantor's  obligations hereunder shall remain in
full force and effect until all Guaranteed  Obligations  shall have been paid in
full and the  Commitments  under the Master  Agreement  shall have terminated or
expired.  If at any time any  payment of or any amount  payable by Dollar or any
other  party  under the Master  Agreement  or any other  Operative  Document  is
rescinded  or must be  otherwise  restored  or  returned  upon  the  insolvency,
bankruptcy  or   reorganization   of  Dollar  or  otherwise,   each  Guarantor's
obligations hereunder with respect to such payment shall be reinstated as though
such payment had been due but not made at such time.

         SECTION  6.  Waiver  of  Notice.  Each  Guarantor   irrevocably  waives
acceptance  hereof,  presentment,  demand,  protest  and, to the fullest  extent
permitted by law, any notice not provided for herein as well as any  requirement
that at any time any action be taken by any  Person  against  Dollar,  any other
guarantor of the Guaranteed Obligations, or any other Person.

         SECTION 7.  Judgment Currency.

         (a) Each Guarantor shall pay all amounts due hereunder in U.S. Dollars,
and such  obligations  hereunder to make  payments in U.S.  Dollars shall not be
discharged  or  satisfied  by any tender or recovery  pursuant  to any  judgment
expressed in or converted into any currency other than U.S.  Dollars,  except to
the extent that such tender or recovery results in the effective  receipt by the
Funding Parties of the full amount of U.S. Dollars expressed to be payable under
this  Subsidiary  Guarantee or the  Operative  Documents.  If for the purpose of
obtaining  or  enforcing   against  any   Guarantor  in  any  court  or  in  any
jurisdiction,  it becomes  necessary to convert into or from any currency  other
than U.S.  Dollars (such other  currency  being  hereinafter  referred to as the
"Judgment  Currency") an amount due in U.S.  Dollars,  the  conversion  shall be
made, and the currency equivalent  determined,  in each case, as on the Business
Day immediately  preceding the day on which the judgment is given (such Business
Day being hereinafter referred to as the "Judgment Currency Conversion Date").

         (b) If there is a change in the rate of exchange  between the  Judgment
Currency Conversion Date and the date of actual payment of the amounts due, each
Guarantor  covenants  and agrees to pay,  or cause to be paid,  such  additional
amounts,  if any (but in any event not a lesser amount),  as may be necessary to
insure that the amount paid in the Judgment Currency, when converted at the rate
of exchange  prevailing on the date of payment,  will produce the amount of U.S.
Dollars  which could have been  purchased  with the amount of Judgment  Currency
stipulated in the judgment or judicial award at the rate of exchange  prevailing
on the Judgment Currency Conversion Date.

         (c) For  purposes  of  determining  the  currency  equivalent  for this
Section,  such amounts shall include any premium and costs payable in connection
with the purchase of U.S. Dollars.

         (d) The currency equivalent of U.S. Dollars shall mean, with respect to
any monetary amount in a currency other than U.S.  Dollars,  at any time for the
determination  thereof,  the amount of U.S.  Dollars obtained by converting such
foreign currency involved in such computation into U.S. Dollars at the spot rate

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<PAGE>

for the purchase of U.S. Dollars with the applicable  foreign currency as quoted
by the Agent at approximately 11:00 a.m. (Nashville, Tennessee time) on the date
of  determination  thereof  specified  herein  or, if the date of  determination
thereof is not  otherwise  specified  herein,  on the date two (2) Business Days
prior to such determination.

         SECTION  8.  Stay of  Acceleration.  If  acceleration  of the  time for
payment of any amount payable by Dollar under the Master Agreement, the Guaranty
Agreement  or any  other  Operative  Document  is  stayed  upon the  insolvency,
bankruptcy or  reorganization  of Dollar,  all such amounts otherwise subject to
acceleration under the terms of the Master Agreement,  the Guaranty Agreement or
any other  Operative  Document  shall  nonetheless  be payable by each Guarantor
hereunder forthwith on demand by the Agent.

         SECTION 9. Notices.  All notices,  requests and other  communication to
any party  hereunder  shall be given or made by  telecopier or other writing and
telecopied,  or mailed or delivered to the intended  recipient at its address or
telecopier  set forth on the  signature  pages  hereof or such other  address or
telecopy  number as such party may hereafter  specify for such purpose by notice
to the Agent in  accordance  with the  provisions  of Section 8.2. of the Master
Agreement.  Except as otherwise provided in this Subsidiary Guarantee,  all such
communications  shall be  deemed to have been duly  given  when  transmitted  by
telecopier,  or personally  delivered or, in the case of a mailed notice sent by
certified  mail return receipt  requested,  on the date set forth on the receipt
(provided,  that any refusal to accept such notice  shall be deemed to be notice
thereof  as of the  time  of any  such  in  each  case  given  or  addressed  as
aforesaid).

         SECTION 10. No Waivers. No failure to delay by the Agent, the Lessor or
the Lender in exercising any right,  power or privilege  hereunder shall operate
as a waiver thereof nor shall any single or partial  exercise  thereof  preclude
any other or further exercise thereof or the exercise of any other right,  power
or privilege. The rights and remedies provided in this Subsidiary Guarantee, the
Master Agreement, the Guaranty Agreement and the other Operative Documents shall
be cumulative and not exclusive of any rights or remedies provided by law.

         SECTION 11.  Successors and Assigns.  This Subsidiary  Guarantee is for
the benefit of the Funding Parties and their respective successors and permitted
assigns  and in the event of an  assignment  of any  amounts  payable  under the
Master Agreement or the other Operative Documents,  the rights hereunder, to the
extent applicable to the indebtedness so assigned,  may be transferred with such
indebtedness. This Subsidiary Guarantee shall be binding upon each Guarantor and
its successors and permitted assigns.

         SECTION 12. Changes in Writing.  Neither this Subsidiary  Guarantee nor
any provision hereof may be changed,  waived,  discharged or terminated  orally,
but only in writing  signed by the  Guarantors and the Agent with the consent of
the Required Liquidity Banks.

         SECTION 13.  GOVERNING LAW;  SUBMISSION TO JURISDICTION  WAIVER OF JURY
TRIAL.  THIS  SUBSIDIARY  GUARANTEE  SHALL  BE  GOVERNED  BY  AND  CONSTRUED  IN
ACCORDANCE  WITH  THE LAWS OF THE  STATE OF  TENNESSEE.  EACH  GUARANTOR  HEREBY
SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR
THE MIDDLE  DISTRICT OF TENNESSEE  AND OF ANY  TENNESSEE  STATE COURT SITTING IN

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NASHVILLE, TENNESSEE AND FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS SUBSIDIARY GUARANTEE (INCLUDING, WITHOUT LIMITATION, ANY OF THE
OTHER  OPERATIVE  DOCUMENTS)  OR  THE  TRANSACTIONS  CONTEMPLATED  HEREBY,  EACH
GUARANTOR  IRREVOCABLY  WAIVES,  TO THE FULLEST  EXTENT  PERMITTED  BY LAW,  ANY
OBJECTION  WHICH IT MAY NOW OR HEREAFTER  HAVE TO THE LAYING OF THE VENUE OF ANY
SUCH  PROCEEDING  BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING
BROUGHT  IN SUCH A  COURT  HAS  BEEN  BROUGHT  IN AN  INCONVENIENT  FORUM.  EACH
GUARANTOR AND EACH FUNDING PARTY  ACCEPTING  THIS  SUBSIDIARY  GUARANTEE  HEREBY
IRREVOCABLY  WAIVE ANY AND ALL  RIGHT TO TRIAL BY JURY IN ANY  LEGAL  PROCEEDING
ARISING OUT OF OR  RELATING TO THIS  SUBSIDIARY  GUARANTEE  OR THE  TRANSACTIONS
CONTEMPLATED HEREBY.

         SECTION 14. Taxes, etc. All payments required to be made by a Guarantor
hereunder shall be made without setoff or counterclaim and free and clear of and
without  deduction  or  withholding  for or on account of, any present or future
taxes, levies,  imposts, duties or other charges of whatsoever nature imposed by
any government or any political or taxing authority thereof, provided,  however,
that if such Guarantor is required by law to make such deduction or withholding,
such  Guarantor  shall  forthwith  pay to the  Agent or any  Funding  Party,  as
applicable,  such additional amount as results in the net amount received by the
Agent or such Funding Party, as applicable, equaling the full amount which would
have been received by the Agent or such Funding  Party,  as  applicable,  had no
such deduction or withholding been made.


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         IN WITNESS WHEREOF, each Guarantor has caused this Subsidiary Guarantee
to be duly  executed  by its  authorized  officers  as of the day and year first
above written.

                                    DOLGENCORP, INC.


                                    By:___________________________________

                                    Title:________________________________


                                    DOLGENCORP OF TEXAS, INC.


                                    By:___________________________________

                                    Title:________________________________


                                    DADE LEASE MANAGEMENT, INC.


                                    By:___________________________________

                                    Title:________________________________


                                    DOLLAR GENERAL FINANCIAL, INC.


                                    By:___________________________________

                                    Title:________________________________


                             DOLLAR GENERAL PARTNERS


                                    By:___________________________________

                                    Title:________________________________


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                                    ADDRESS FOR NOTICES FOR ALL
                                    GUARANTORS:

                                    Larry Wilcher
                                    General Counsel
                                    Dollar General Corporation
                                    427 Beech Street
                                    Scottsville, Kentucky 42164
                                    Telecopier No.:  502/237-3909




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ACCEPTED BY:

SUNTRUST BANK, NASHVILLE, N.A.,
         as Agent


By:________________________________

Title:_____________________________




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