<PAGE>

                     DISTRIBUTION AND FULFILLMENT AGREEMENT
                     --------------------------------------

     This DISTRIBUTION AND FULFILLMENT AGREEMENT (the "Agreement") is made as of
May 12, 2000 (the "Effective Date") by and between BUY.COM INC., a Delaware
corporation, with its principal place of business at 85 Enterprise, Aliso Viejo,
CA 92656 (the "Seller"), and INGRAM ENTERTAINMENT INC., a Tennessee corporation,
with its principal place of business at Two Ingram Boulevard, La Vergne,
Tennessee 37089 (the "Distributor").

     1.   Definitions.
          -----------

          1.1  "Back Ordered Products" means Products that Distributor does not
     have in stock in its shipping facilities at the time an Order is submitted
     for them.

          1.2  "Business Day" means a day on which Distributor regularly
     conducts business, excluding holidays.

          1.3  "Customer" means a person in the United States, its territories
     and protectorates, who orders Products from Seller's online retail store.

          1.4  "Damaged Products" means Products shipped by Distributor which
     are damaged during shipment to Customers to the extent that the Products
     cannot be used for their intended purpose.  Products damaged while in the
     care, custody, or control of the Customer are not Damaged Products for
     purposes of this Agreement.

          1.5  "Defective Products" means Products shipped by Distributor which
     contain manufactured defects which prevent them from being used for their
     intended purpose.

          1.6  "EDI" means the EDI/X.12 based order delivery format for
     transmitting data between computers via a value-added network (mailbox
     service provider) or via the Internet.

          1.7    "Electronic Report" means information provided electronically.

          1.8  "FTP" means file transfer protocol utilized to provide
     information necessary for placing orders with Distributor via a value-added
     network or the Internet.

          1.9  "Inserts" means custom insertions acceptable to Distributor which
     Seller delivers to Distributor at no expense to Distributor and which
     Seller requests to be included with Shipments.

                                       1
<PAGE>

          1.10 "Order" means a Product order placed by Seller in accordance with
     this Agreement.

          1.11 "Priority Order" means an Order to be shipped via overnight or
     second day air freight.

          1.12 "Products" means Distributor's (or its vendors') products Seller
     may purchase pursuant to this Agreement.

          1.13 "Shipment" means a shipment of Product by Distributor in response
     to an Order.

          1.14 "Shipping Facilities" means Distributor facilities in the United
     States designated from time-to-time by Distributor as direct-to-consumer
     distribution facilities.

          1.15  "Standard Order" means an Order other than a Priority Order.

          1.16  "Unmerchandisable Products" means Products shipped by
     Distributor which are shopworn and/or soiled.

     2.   Electronic Data Transmission.  Electronic data transmissions between
          ----------------------------
Distributor and Seller shall be via EDI.  Distributor will furnish Seller the
specifications for FTP and any other means of electronic data transmission
(other than EDI).  Distributor may change those specifications from time-to-time
on not less than 30 days prior written notice to Seller.

     3.   Fulfillment Services.
          --------------------

          3.1  Orders.  Seller will transmit Orders to Distributor via
     electronic data transmission. Seller will use commercially reasonable
     efforts to send Orders to Distributor in continuous serial transmissions in
     intervals of no less than one hour. Distributor will use commercially
     reasonable efforts to service Priority Orders and Standard Orders as set
     out in Section 3.2 below. Each Order shall contain the following
            -----------
     information: (a) the Customer's name and complete shipping address; (b) the
     Distributor-approved shipping method to be used; (c) the text of any
     special messages to the Customer; and (d) the Products to be shipped and
     their quantity.

          3.2  Fulfillment.  After receipt of an Order, Distributor will: (a)
     fill the Order from Products in stock at the Shipping Facilities; (b) print
     all packing slips excluding Inserts; (c) insert all packing slips and
     Inserts; (d) print and affix shipping labels on Shipments; (e) when made
     available by Distributor, print the text of any reasonable special message
     acceptable to Distributor on the standard packing slip requested by Seller
     in the Order; (f) ship the Order to the Customer; (g) order from the vendor
     any Back Ordered Products and notify Seller that the

                                       2
<PAGE>

     Back Ordered Products are backordered and the expected arrival date if
     available (in which case Seller may, via electronic data transmission to
     Distributor, or other mutually agreed method of communication, elect to
     terminate the Order with respect to the Back Ordered Products or in total);
     and (h) if not terminated as described in clause (g), ship any Back Ordered
                                               ----------
     Products following their receipt by Distributor at the Shipping Facilities
     in accordance with the terms of this Section. Provided Distributor receives
     a Priority Order and the related picking ticket is printed no later than
     [***], Central Time on a Business Day, Distributor will use commercially
     reasonable efforts to ship the Order [***]. If a Priority Order is received
     and the related picking ticket is printed after [***], Central Time on a
     Business Day, Distributor will use commercially reasonable efforts to ship
     the Order [***]. Provided Distributor receives a Standard Order and the
     related picking ticket is printed no later than [***], Central Time, on a
     Business Day, Distributor will use commercially reasonable efforts to ship
     the order [***]. If a Standard Order is received and a related picking
     ticket is printed after [***], Central Time, on a Business Day, Distributor
     will use commercially reasonable efforts to ship the Order [***]. If
     Distributor does not ship an Order as provided above, Distributor will
     notify Seller no later than [***], and Seller may without obligation cancel
     the Order by notice to Distributor via electronic data transmission. Seller
     will also have the right to cancel an Order by notice to Distributor via
     electronic data transmission (or other mutually agreed method of
     communication) [***] with respect to that Order. Seller will not be
     invoiced for cancelled Orders. Seller will notify Customers of Order
     cancellations. For any Orders not sent in a continuous serial transmission
     in intervals of no less than [***], Distributor will use commercially
     reasonable efforts to ship the Order within the later of [***] of the Order
     being received by Distributor and being available to be printed in
     Distributor's warehouse, or [***].

          3.3  Packing Slips.  Packing slips printed and inserted in Shipments
     by Distributor will be agreed upon in "look and feel" by Distributor and
     Seller, based on Seller's specifications and Distributor's capability.

          3.4  Shipment.  Distributor will use commercially reasonable efforts
     to ship Products in accordance with the Distributor-approved shipping
     methods specified by Seller in the Order.  Distributor will use
     commercially reasonable efforts to package all Shipments in a manner to
     prevent damage during shipment, the "look and feel" of which packaging will
     be agreed upon by Distributor and Seller, based on Seller's specifications
     and Distributor's capability.  Distributor will cooperate with Seller in
     tracking any lost shipments and filing any related carrier claims.  Except
     as specifically set out in this Agreement, all shipping shall be at the
     expense of Seller, or, if paid by Distributor, reimbursed by Seller at
     Distributor's cost (including discounts).  In the event of a planned system
     shutdown during a Business Day exceeding [***] or a physical inventory that
     delays shipments for more than [***], Distributor shall, at no cost to
     Seller,

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       3
<PAGE>

     [***]. The risk of loss for Products shall pass from Distributor when the
     Products are delivered to the carrier for shipment to the Customers.
     Distributor shall provide Seller a [***] of net purchases per month credit,
     which Seller and Distributor hereby agree will be deemed to compensate
     Seller for any mis-shipments by Distributor.

          3.5  Master Database License Agreement. Distributor and Seller hereby
     ratify and affirm the terms and conditions of the Master Database License
     Agreement between Seller and SPEEDSERVE.COM INC., dated December 3, 1998,
     as to which Seller is the successor to SPEEDSERVE.COM INC. (the "Database
     License"). The Database License describes the Products as of the most
     recent update of the Ingram Entertainment Inc. Master Database (the "Master
     Database") made available to Seller. Distributor makes no representation or
     warranty as to the availability of any of the Products, whether or not
     included in the Master Database.

          3.6  Reports to Seller.

               (a) [***], Distributor will furnish Seller Electronic Reports of
          the following: (A) all Shipments made that Business Day by Order
          number and tracking number (if available), all Products contained in
          each Order, and all Back Ordered Products by order number, and (B)
          Orders received, but not shipped, and the status of each such Order;
          and (C) all Product returns (identified by Return Authorization
          Number) processed by Distributor indicating quantity and item(s)
          received and other information in reasonably sufficient detail (i.e.
                                                                          ----
          Customer and invoice number) to allow Seller to properly credit
          Customers for such returns.

               (b) [***], Distributor shall provide a statement of account which
          details (i) all invoices sent to Seller during the prior calendar
          month; (ii) all payments received from Seller during the prior
          calendar month, and other credits made against Seller's payment
          obligations; and (iii) all unpaid invoices.

          3.7  License.  Seller hereby grants to Distributor the license to (a)
   distribute the Inserts in connection with the Products, and (b) use Seller's
   trademarks in accordance with Seller's specifications on Product invoices and
   other materials provided to Customers.

          3.8  Non-Exclusive Dealing. Nothing in this Agreement requires
   Distributor to deal exclusively with Seller in any capacity or Seller to deal
   exclusively with Distributor in any capacity.

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       4
<PAGE>

     4.   Returns.
          -------

          4.1  Returns Generally. Return allowance rights of Seller with respect
     to particular Products are set out in Exhibit A. In order for returned
                                           ---------
     Products (including Defective Products, Unmerchandisable Products, Damaged
     Products, and Products erroneously shipped to Customers) to be eligible for
     credit pursuant to this Agreement, Seller agrees to the following
     procedures:

               (i)   Seller must furnish Distributor a request for return
          authorization (RMA) no later than [***] after shipment of the relevant
          Products to a Customer;

               (ii)  Seller will furnish the Customer desiring to return
          Products a return authorization (RA) number of no more than eight
          characters, all of which must be alpha numeric; and

               (iii) Seller will furnish to Distributor Seller's RA number
          furnished to the Customer; the Seller's account number for that
          Customer; the item number(s) or UPC number(s) of the Products being
          returned; the quantity of each Product being returned; Seller's
          invoice number to which the return is to be applied; and the reason
          for the Product return (carrier damage, shipped in error, defective,
          Customer error, Customer change in preference, etc.).

     Seller will be issued a credit by Distributor for [***] for the returned
     Products (excluding freight and handling fees) or, [***]; provided,
                                                               --------
     however, that if Seller furnishes Distributor the applicable invoice number
     -------
     and the returned Products have been received by Distributor no more than
     [***] after the invoice date, such credit will be equal to [***] shown on
     that invoice. In the event of the return by Customers of Defective
     Products, Unmerchandisable Products, Products shipped erroneously to
     Customers, and/or Damaged Products, the credit set out in this paragraph
     will include [***]. Distributor will provide Seller with information in
     reasonably sufficient detail (i.e. Seller's RA number and invoice number
                                   ----
     (if provided by Customer)) to allow Seller to properly credit Customers for
     such returns. Credit memos for returns will be processed by Distributor and
     delivered to Seller within [***] after Distributor's receipt of the
     returned Product. Credits issued to Seller under any such credit memos will
     be applied [***]. Seller will reimburse Distributor per normal payment
     terms set out in Section 5.3 for any freight costs charged to Distributor
                      -----------
     by the carrier due to Customer refusal to accept delivery of Products
     correctly shipped to the Customer which are then returned by the carrier to
     Distributor. Except as set out in Section 3.4, Distributor's sole liability
                                       -----------
     for any Defective Products, Unmerchandisable Products, Products erroneously
     shipped to Customers, and/or Damaged Products will be acceptance of their
     return and issuance of the credit set out in this

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       5
<PAGE>

     paragraph. If Seller desires replacement of any of the four types of
     Products described in the preceding sentence, Seller will initiate a new
     order for the replacement Products.

          4.2  Limitation on Return of Defective Products, Unmerchandisable
     Products, and Damaged Products. On a category-by-category basis, using the
     categories set out in Exhibit A, the return rights of Seller with respect
                           ---------
     to Defective Products, Unmerchandisable Products, and Damaged Products will
     be limited, on a monthly basis, to [***], on a title-by-title basis, of net
     units purchased, plus pass through of any additional damaged/defective
     return privileges granted by the studio or other manufacturer for that
     particular title.

          4.3  Mint, Resalable Condition. All Product returned to Distributor
     (except for returns of Defective Products, Unmerchandisable Products, or
     Damaged Products) must be with the original packaging intact (including
     manufacturer's shrink wrap) and otherwise in mint, resalable condition. No
     credit will be issued for any returned Product not in mint, resalable
     condition with the original packaging intact, except as set forth above.

     5.   Payment.
          -------

          5.1  Prices. Product and service prices to be paid by Seller to
     Distributor are set forth on Exhibit A.
                                  ---------

          5.2  Fees.  Fees for services provided by Distributor to Seller are
     set forth on Exhibit A.
                  ---------

          5.3  Payment Terms. Distributor will invoice Seller upon shipment of
     Product. All invoices shall be due and payable [***] from invoice date.
     Seller understands that if a credit line with Distributor is established,
     it may be modified from time-to-time based upon Distributor's credit review
     and credit policies. Any amounts not paid when due will be subject to a
     late charge of [***] per month ([***] per annum) on the overdue balance
     (or, if less, the maximum amount permitted by applicable law). Disputed
     amounts are limited to incidents where an incorrect price has been charged,
     Distributor has failed to comply with Seller's shipping instructions, or
     duplicate orders were issued by Distributor. If an item is disputed, both
     parties will work in good faith to resolve the disputed item within [***]
     and the item will not accrue late charges during that time. If the parties
     cannot resolve the disputed item within the [***] time frame, said disputed
     amount will start accruing late charges on [***] at the rate set forth
     above until resolved. Payments received from Seller will be credited first
     to unpaid interest.

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       6
<PAGE>

          5.4  Advertising.  Advertising is addressed in Exhibit A.
                                                         ---------

     6.   Disclaimer.  DISTRIBUTOR PROVIDES ALL PRODUCTS, MATERIALS AND SERVICES
          ----------
TO SELLER AND ITS CUSTOMERS "AS IS," AND DISTRIBUTOR DISCLAIMS ALL WARRANTIES
AND CONDITIONS, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION THE IMPLIED
WARRANTIES OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY, AND FITNESS FOR A
PARTICULAR PURPOSE.  However, the foregoing disclaimer does not limit any
warranties provided by Product vendors to either Seller or its Customers. To the
extent any Order includes a message from the Customer to the recipient of the
Order, Seller acknowledges that Distributor will not screen or review any such
message and Seller agrees to indemnify and hold harmless Distributor from and
for any claim allegation, cost, loss, or liability of Distributor related to any
such message or its inclusion in any order.  Each party acknowledges that it has
not entered into this Agreement in reliance upon any warranty or representation
except as specifically set forth herein.  DISTRIBUTOR HAS NOT LICENSED OR
PROVIDED AND DOES NOT HEREBY LICENSE OR PROVIDE SELLER THE RIGHT TO USE ANY
LOGO, TRADEMARK, OR OTHER INTELLECTUAL PROPERTY OF DISTRIBUTOR, ANY SUPPLIER OR
VENDOR, OR ANY OTHER PARTY.

     7.   Limitation of Liability.  NEITHER DISTRIBUTOR NOR SELLER SHALL BE
          -----------------------
LIABLE FOR PUNITIVE, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST
PROFITS (INCLUDING DUE TO NEGLIGENCE) ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT, EVEN IF SUCH PARTY HAS NOTICE OF THE POSSIBILITY OF SUCH DAMAGES.
THE ONLY LIABILITY DISTRIBUTOR WILL HAVE WITH RESPECT TO ANY DEFECTIVE PRODUCTS,
DAMAGED PRODUCTS, UNMERCHANDISABLE PRODUCTS, AND/OR PRODUCTS ERRONEOUSLY SHIPPED
WILL BE THE RETURN RIGHTS OF CUSTOMERS AND THE OBLIGATION TO PROVIDE THE CREDITS
DESCRIBED IN THIS AGREEMENT.  IN THE EVENT OF AN ALLEGED BREACH OF THIS
AGREEMENT BY DISTRIBUTOR, THE MAXIMUM LIABILITY OF DISTRIBUTOR TO SELLER SHALL
NOT EXCEED $1,000,000.  IN THE EVENT OF AN ALLEGED BREACH OF THIS AGREEMENT BY
SELLER, THE MAXIMUM LIABILITY OF SELLER TO DISTRIBUTOR, IN ADDITION TO PAYMENT
OF ALL AMOUNTS DUE TO DISTRIBUTOR UNDER SECTION 5, SHALL NOT EXCEED $1,000,000.
                                        ---------
THE PRECEDING TWO SENTENCES SHALL NOT APPLY TO ANY BREACHES OF SECTIONS 9, 11,
                                                               ---------------
12.11, OR 12.12.
---------------

     8.   Term and Termination.
          --------------------

          8.1  Term.  Unless earlier terminated as specified below, this
     Agreement expires December 2, 2001; provided, however, that Distributor may
     terminate this Agreement immediately in the event Seller becomes more than

                                       7
<PAGE>

     [***] past due or otherwise violates its credit terms with Distributor.
     This Agreement shall automatically renew for additional one year terms
     unless one party provides the other written notice of non-renewal [***]
     prior to the expiration of the initial or any renewal term. During any
     renewal term this Agreement may be terminated by either party at any time
     for any reason on [***] prior written notice to the other.

          8.2  Event of Default.  Either party may terminate this Agreement
     immediately upon the occurrence of an Event of Default by the other party.
     As used herein, an "Event of Default" means the defaulting party's failure
     to cure, after receipt of not less than 30 days' prior written notice from
     the non-defaulting party, any of the following: (a) failure of the
     defaulting party to observe or perform any condition or obligation imposed
     on the defaulting party under this Agreement (including payment
     obligations); (b) breach of any warranty made by the defaulting party under
     this Agreement; or (c) filing of a voluntary petition in bankruptcy or
     having an involuntary petition filed against the defaulting party, or the
     execution of an assignment for the benefit of creditors of the defaulting
     party. The option to terminate this Agreement shall be in addition to, and
     not in lieu of, any other remedy available to the terminating party under
     this Agreement or at law or equity, all such remedies being cumulative.

          8.3 Effect of Termination. Upon expiration or termination, at Seller's
     option, Distributor will either (a) fulfill all pending Orders in
     accordance with their terms, in which case all applicable covenants and
     licenses under this Agreement shall survive to the limited extent necessary
     to fulfill such Orders, or (b) cancel all pending Orders and immediately
     refund any payments already made for such pending Orders and any credits
     due. Absent election by Seller, Distributor may elect (a) or (b). Further,
     the parties will promptly reconcile accounts payable and receivable and
     bring the balance owed, if any, current. Sections 2, 4, 6, 7, 8.4, 9, 10,
                                              -------- -  -  -  -  ---  -  --
     11, and 12 shall survive termination or expiration.
     --      --

     9.   Confidentiality.  The parties agree, during the term of this Agreement
          ---------------
and for the five year period following its termination or expiration, to keep
strictly confidential and not disclose to any party, other than its agents,
employees, contractors, or advisors, and then only on a need to know basis after
having informed such individuals of the confidential nature of the information
and such party's obligation to protect that confidentiality and not to disclose
such information except as set out herein, the following:  (a) any term or
condition of this Agreement or of any transaction entered into pursuant to it,
or (b) any information about the other party or its business, operations,
products, finances, customers, distributors, systems, budgets, or liabilities
obtained in connection with this Agreement or the transactions contemplated by
it.  The provisions of this Section shall not apply to information which (v) is
already known to the receiving party or is publicly available at the time of
disclosure; (w) becomes publicly available after disclosure through no act of
the receiving party; (x) is disclosed

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       8
<PAGE>

by the disclosing party without an obligation or reasonable expectation of
confidentiality; (y) is required by law or governmental agency to be disclosed
(after providing the disclosing party the opportunity to seek a protective order
or confidential treatment at its expense), or (z) is required by the Securities
and Exchange Commission. Neither party shall issue any press release or similar
publicity statement concerning this Agreement's existence or terms without both
parties' prior approval.

     10.  Compliance with Laws.  At its own expense, each party will comply with
          --------------------
all applicable laws and regulations regarding its activities related to this
Agreement.

     11.  Taxes.
          -----

          11.1  Generally. Seller is the seller of the Products to its Customers
     and shall be solely responsible for any and all sales and similar taxes
     arising from such sales. Subject to Section 11.2, SELLER SHALL FOREVER
                                         ------------
     DEFEND, INDEMNIFY, AND HOLD HARMLESS DISTRIBUTOR AND ITS AFFILIATES, AND
     THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AND CONTRACTORS, FROM ANY
     AND ALL SALES, USE, AND SIMILAR TAX LIABILITY, INCLUDING INTEREST,
     PENALTIES, AND RELATED CHARGES, ARISING FROM THE SALE OF THE PRODUCTS TO
     CUSTOMERS OR THE SHIPMENT OF PRODUCTS BY DISTRIBUTOR TO CUSTOMERS
     (COLLECTIVELY, "TAXES"), EXCEPT TO THE EXTENT SUCH TAXES ARE LEVIED ON THE
     INCOME DISTRIBUTOR DERIVES FROM SALES TO SELLER (THE "TAX INDEMNIFICATION
     OBLIGATION"). The Tax Indemnification Obligation shall be increased by and
     include interest on any sum not paid when due, at the rate of [***] per
     annum, compounded annually, until paid. Distributor represents and warrants
     as of December 28, 2000, that no state has notified Distributor of, or
     assessed Distributor for, any Taxes which would give rise to a Tax
     Indemnification Obligation.

          11.2  Nexus States. With respect to Taxes imposed by any state listed
     on Exhibit B (each a "Nexus State"), the Tax Indemnification Obligation
        ---------
     shall be limited to Taxes in connection with Orders received by Distributor
     from Seller [***]. Distributor will establish a reserve equal to [***] (the
     "After-Tax Reserve"). To the extent, on January 1, 2005, the After-Tax
     Reserve exceeds the total of any and all liability of Distributor for Taxes
     paid or incurred to each Nexus State in connection with Orders received by
     Distributor from Seller on or after [***], that excess shall be applied to
     any unpaid Tax Indemnification Obligation. To the extent any balance of the
     After-Tax Reserve still remains, that balance will be paid to Seller, plus
     interest on that balance from [***], to the date of payment, calculated at
     [***] per annum, compounded annually. Distributor shall have no obligation
     to hold the After-Tax Reserve in any fund,

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       9
<PAGE>

     separate or otherwise, and, except as set out above, shall have no
     obligation to pay Seller any interest or other income in connection with
     the After-Tax Reserve.

     12.  General Provisions.
          ------------------

          12.1 Governing Law/Forum Selection. This Agreement will be governed
     and construed in accordance with the laws of the State of Tennessee without
     giving effect to conflict of laws principles. Both parties submit on a non-
     exclusive basis to the jurisdiction and venue of the federal and state
     courts sitting in Nashville, Tennessee or in Orange County, California, and
     further agree that any cause of action arising under this Agreement may be
     brought in such courts.

          12.2 Severability; Headings. If any provision herein is held to be
     invalid or unenforceable for any reason, the remaining provisions will
     continue in full force without being impaired or invalidated in any way.
     Headings are for reference purposes only and in no way define, limit,
     construe or describe the scope or extent of such section.

          12.3 Force Majeure. If performance hereunder is prevented, restricted
     or interfered with by any action or condition whatsoever beyond the
     reasonable control of a party, the party so affected, upon giving prompt
     notice to the other party, shall be excused from such performance to the
     extent of such prevention, restriction or interference. Each party shall
     use commercially reasonable efforts to mitigate the effect of a force
     majeure.

          12.4 Independent Contractors. The parties are independent contractors,
     and no agency, partnership, joint venture, employee-employer or franchisor-
     franchisee relationship is intended or created by this Agreement. Neither
     party shall make any warranties or representations on behalf of the other
     party.

          12.5 Notice. Except as otherwise specified, any notices hereunder
     shall be given to the appropriate party at the address specified above or
     at such other address as the party shall specify in writing. Notice shall
     be deemed given upon personal delivery; if sent by fax, upon confirmation
     of receipt; if sent by certified or registered mail, postage prepaid, three
     mail delivery days after deposit in the U.S. mail; or if sent by overnight
     courier, upon receipt.

          12.6 Assignments. Neither party may assign this Agreement or its
     rights or obligations under it without the prior written consent of the
     other; provided, however, that either party may assign all of its rights
            -----------------
     and obligations under this Agreement without the prior written consent of
     the other party if the assignee is (a) an entity which directly or
     indirectly controls, is controlled by, or is under common control with the
     assigning party, or (b) an acquirer of substantially all of the assets of
     the assigning party via merger, stock sale, or other means; provided,
                                                                 --------
     further, that in each case the assignee expressly agrees in
     -------

                                       10
<PAGE>

     writing, for the benefit of the non-assigning party, to be bound by all
     terms, conditions, and obligations of the Agreement and the non-assigning
     party receives prompt notice of the assignment. In no event may either
     party assign this Agreement to a party reasonably deemed a competitor of
     the non-assigning party. In the event the assigning party is Seller or an
     assignee of Seller, Distributor reserves the right to independently analyze
     the credit line, if any, to be granted by Distributor to such assignee.

          12.7  Counterparts. This Agreement may be signed in any number of
     counterparts, each of which (when executed and delivered) shall constitute
     an original instrument, but all of which together shall constitute one and
     the same instrument. A telecopy signature shall be deemed an original
     signature for the purposes of this Agreement.

          12.8  Parties Bound. This Agreement shall be binding upon the parties
     and their respective successors and assigns.

          12.9  Entire Agreement; Waiver. Effective the Effective Date, the
     terms and conditions of this Agreement amend, restate, and supersede those
     in the supply agreement between Ingram and SPEEDSERVE.COM, INC.,
     predecessor to Seller, dated December 3, 1998, as amended by letter dated
     August 23, 1999. This Agreement sets forth the entire understanding and
     agreement of the parties, and supersedes any and all oral or written
     agreements or understandings between the parties, as to the subject matter
     of this Agreement. Except as otherwise provided herein, it may be changed
     only by a writing signed by both parties. The waiver of a breach of any
     provision of this Agreement will not operate or be interpreted as a waiver
     of any other or subsequent breach.

          12.10  Distributor Indemnification. Distributor agrees to indemnify
     and defend Seller against, and hold Seller free and harmless from, any and
     all loss, damage, settlement or expense (including reasonable legal
     expenses), as incurred, resulting from or arising out of any breach of any
     of Distributor's representations and warranties herein, the distribution
     and sale of any of the Products, the use thereof, or any Product defects;
     provided that Seller immediately notifies Distributor, in writing, of any
     notice or claim of such loss, damage or expense of which it becomes aware,
     and permits Distributor to control, in a manner not adverse to Seller, the
     defense, settlement, adjustment or compromise of any such claim using
     counsel reasonably acceptable to Seller; provided further that
     Distributor's obligation under this Section 12.10 with respect to the
                                         -------------
     representations and warranties in Section 12.13 (a), (b), and (d) or with
                                       ------------- ---  ---      ---
     respect to the distribution and sale of any of the Products, the use
     thereof, or any Product defects, is additionally limited to
     indemnification, defense, and holding free and harmless only to the extent,
     if any, that Distributor is so indemnified, defended, and held free and
     harmless by its supplier.

                                       11
<PAGE>

          12.11  Customer Data. All Customer information and other Customer data
     collected by Seller pursuant to this Agreement shall be the exclusive
     property of Seller and be subject to Section 9 of this Agreement. Such
     information and data shall not be provided or disclosed to Distributor
     except as reasonably necessary to perform its obligations under this
     Agreement and may be used by Distributor only as reasonably necessary to
     perform its obligations under this Agreement.

          12.12  Records/Audit Rights. During the term of this Agreement,
     Distributor shall keep and maintain detailed and accurate books and records
     with regard to Product prices, Product costs, and shipping costs at such
     address(es) as it shall notify Seller of in writing from time to time.
     Seller or its representatives shall be entitled to review and audit such
     books and records and/or compliance with the terms of this Agreement during
     normal business hours upon reasonable notice to Distributor, as applicable,
     and copy pertinent materials from such books and records relating to the
     audit. Any information provided by Distributor in compliance with this
     Section, and any notes, extracts, compilations or copies of it shall be
     held in strict confidence by Seller and its representatives, be subject to
     Section 9 of this Agreement, and be used only as reasonably necessary to
     monitor compliance with this Agreement. The provisions of the preceding
     sentence shall survive termination of this Agreement.

          12.13 Distributor Representations and Warranties. Distributor
     represents and warrants to Seller:

                (a)  that it has the rights and licenses (including without
          limitation appropriate sublicense rights) necessary to permit Seller
          to market, resell, and distribute the Products;

                (b)  that the manufacturers and vendors of the Products do not
          prohibit Buy.Com from allowing the resale of such Products via the
          Internet;

                (c)  that (i) it has the full authority and legal right to carry
          out the terms of this Agreement; (ii) it has taken all action
          necessary to authorize the execution and delivery of this Agreement;
          (iii) this Agreement is a legal, valid, and binding obligation of
          Distributor enforceable in accordance with its terms, except as
          limited by bankruptcy and other laws of general application relating
          to or affecting the enforcement of creditors' rights; and (iv) it has
          not entered into and is not currently a party to any agreement that
          conflicts with the terms of this Agreement; and

                (d)  that the Products (i) shall be free and clear of all liens
          and encumbrances and (ii) shall be free from defects (including
          without limitation in workmanship, material, manufacture and design).

                                       12
<PAGE>

          12.14  Seller Representations and Warranties. Seller represents and
     warrants to Distributor that (a) it has the full authority and legal right
     to carry out the terms of this Agreement; (b) it has taken all action
     necessary to authorize the execution and delivery of this Agreement; (c)
     this Agreement is a legal, valid, and binding obligation of Seller
     enforceable in accordance with its terms, except as limited by bankruptcy
     and other laws of general application relating to or affecting enforcement
     of creditors' rights; and (d) it is not entered into and is not currently a
     party to any agreement that conflicts with the terms of this Agreement.

          12.15  Seller Indemnification. Seller agrees to indemnify and defend
     Distributor against, and hold Distributor free and harmless from, any and
     all loss, damage, settlement or expense (including reasonable legal
     expenses), as incurred, resulting from or arising out of any breach of any
     of Seller's representations and warranties herein, provided that
     Distributor immediately notifies the Seller, in writing, of any notice or
     claim of such loss, damage or expense of which it becomes aware and permits
     Seller to control, in a manner not adverse to Distributor, the defense,
     settlement, or compromise of any such claim using counsel reasonably
     acceptable to Distributor.

     "SELLER"                                 "DISTRIBUTOR"

BUY.COM INC.                            INGRAM ENTERTAINMENT INC.

By:__________________________           By:____________________________
Print Name:__________________           Print Name:  W. Donnie Daniel
Title:_______________________           Title: Senior Vice President, Finance
                                               and Administration, Chief
                                               Financial Officer, and Treasurer

                                       13
<PAGE>

                                    EXHIBITS
                                    --------

A.   Pricing

B.   Nexus States

                                       14
<PAGE>

                                   EXHIBIT A
                                   ---------

It is intended by Distributor and Seller that the pricing and related terms and
conditions (including freight, and advertising) between them for the products
covered by this Agreement be [***]./__/ Thus, the prices and related terms and
conditions set out below will be reviewed and modified to the extent necessary
for Seller to obtain [***].

  1. Rental Pricing:
     Seller will receive [***] pricing on all rental videocassette product
     (suggested retail price of [***] and higher). Gross cost is defined as
     Distributor's actual replacement cost. Seller will receive [***] on single
     purchases of multi-pack titles.

  2. Sell-through Pricing:
     Seller will receive [***] pricing, on all sell through videocassette
     product, (suggested retail price of [***] and under) with the exception of
     "Feature Sellthrough". Seller will receive [***] on Feature Sellthrough.
     Feature Sellthrough is defined as, any new or re-release, with a suggested
     retail price of $29.99 and under, in which the studio has set a national
     sales goal of 2 million or more units. Feature Sellthrough titles will
     revert to non feature pricing 30 days after release date.

  3. Videocassette Returns:
     Seller will receive a [***] return allowance on all unopened videocassette
     product in mint, resalable condition.

  4. Video Games:
     Seller will receive [***] pricing on video game rental and sell-through
     titles. Seller will receive a [***] title-by-title return allowance on all
     unopened video game sell-through product in mint, resalable condition.

  5. DVD:
     Seller will receive [***] pricing on DVD purchases and a [***] return
     allowance on all unopened DVD product in mint, resalable condition.

  6. Audio Books:
     Seller will receive a [***] discount off suggested retail price on audio
     book product purchases. Seller will receive a [***] return allowance on all
     unopened product in mint, resalable condition.

  7. Previously Viewed Video Product:
     Seller will receive [***] pricing on previously viewed video product
     purchases. [***].

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       15
<PAGE>

  8. Multimedia:
     Seller will receive [***] pricing on CD ROM product. Seller will receive a
     [***] return allowance on all unopened product in mint, resalable
     condition.

  9. Accessories:
     Seller will receive [***] pricing on all accessories. Seller will receive a
     [***] return allowance on all unopened accessory product in mint, resalable
     condition.

 10. Special Handling:
     For special handling (e.g. inserts), Seller and Distributor shall agree in
                           ----
     advance on the pricing to be offered to Seller.

 11. Advertising:
     Distributor agrees to assist Seller through December 2, 2001, on a best
     efforts basis, in the sale of advertising spaces on the BuyVideos and
     BuyGames web sites (the "Advertising Spaces"). Distributor's assistance
     shall include, but not be limited to, introductions to marketing personnel
     within the various studios, help in devising strategies for solicitation of
     the Advertising Spaces, participation in two annual Seller vendor events,
     and Seller's participation as a featured retailer at Distributor's annual
     video sales conference and key game retailer meetings.

     Distributor earns co-op advertising dollars on purchases of certain
     products from studios. Each title released has a different co-op program,
     with current customary programs providing for co-op accrual rates from
     [***] of product cost. Accrual of co-op advertising dollars by Distributor
     is based on the price Distributor pays to the studio for the product
     purchased, rather than on the price paid for the products by the retailer
     to Distributor. Through December 2, 2001, on a monthly basis, Distributor
     will directly pass-through funds to Seller in an amount equal to [***] of
     (a) the gross cost to Distributor of its products sold to Seller, less (b)
     the gross cost to Distributor of products returned by Seller to Distributor
     in that month, for use in advertising video and game products for sale on
     the Seller web sites.

     Seller will spend the amounts received from Distributor pursuant to the
     preceding paragraph on advertising video and game products on the Seller
     web sites and/or other advertising programs involving video and game
     products. Product selection and Seller pricing will be determined by Seller
     and will not affect amounts paid by Distributor pursuant to the preceding
     paragraph. By [***] Distributor will provide Seller with a report showing
     the previous month's sales by Distributor to Seller and returns by Seller
     to Distributor, together with a breakdown by product category of accrued
     pass-through funds. Seller will bill Distributor by [***] for the Seller
     advertising during that preceding month. Included in the Seller billing
     package will be proof of performance such as screen shots. All billing will
     be based on Seller's then current rate card. Amounts owed to Seller by
     Distributor

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       16
<PAGE>

     shall be credited via credit memo against any amount owed to Distributor by
     Seller for products purchased by Seller. These amounts will be credited to
     Seller within [***] of the billing date. Amounts owed by Seller to
     Distributor for the purchase of products pursuant to this Agreement shall
     be due and payable irrespective of Distributor's payment of pass-through
     funds to Seller. Pass-through funds owed by Distributor to Seller pursuant
     to this Agreement shall be due and payable irrespective of Seller's payment
     for product purchased under this Agreement. Payments made pursuant to this
     paragraph are considered by the parties to be material to this Agreement.
     Breach by a party of the payment terms of this paragraph shall entitle the
     non-breaching party to terminate this Agreement after providing the
     breaching party with a 15-day notice to cure the breach.

     From time to time, Seller may receive marketing funds directly from studios
     and other vendors.  Seller's receipt of such funds shall not affect the
     amounts paid by Distributor to Seller pursuant to this Agreement.  In
     addition, any MDF and/or co-op funding negotiated by Seller with any vendor
     will not affect the amounts paid by Distributor to Seller pursuant to this
     Agreement.

12.  Handling Fee:

     Seller will pay Distributor [***] handling fee for all units for which
     Distributor furnishes fulfillment services under this Agreement.  These
     fees will be paid per Section 5.3 of the Agreement.
                           -----------

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       17
<PAGE>

                                   EXHIBIT B
                                   ---------
[***]

____________________
  [***] Confidential treatment has been requested for the bracketed portions.
The confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.

                                       18