AGREEMENT


          THIS  AGREEMENT  ("Agreement"),  entered  into as of the  first day of
April,  1997, between ROBERT J. KLEIN  (hereinafter  "Klein") and MOOVIES,  INC.
(hereinafter, "Company").

                              W I T N E S S E T H:

          WHEREAS,  Klein is  currently  employed  by Company  and serves on its
Board of Directors (the "Board"); and

          WHEREAS, Klein and Company have agreed that it is in their mutual best
interest to terminate  their  employer/employee  relationship  and to resolve by
full and final  settlement all matters arising out of or pertaining to the past,
present or future employment of Klein with Company and certain other matters and
for Klein to resign  from the Board and from his  offices  with  Company and its
subsidiaries and affiliates, in accordance with the terms hereof.

          NOW,   THEREFORE,   IN   CONSIDERATION  of  the  mutual  promises  and
undertakings contained herein and for other good and valuable consideration, the
receipt and  sufficiency  of which are hereby  acknowledged,  the parties hereto
agree as follows:

          1.  Effective  as  of  April  1,  1997  (the  "Effective  Date"),  the
employment  of Klein  with  Company  is  terminated  by  mutual  agreement.  The
Employment Agreement,  made effective as of October 1, 1995, as amended, between
Klein and Company (the "Employment  Agreement"),  is hereby terminated effective
as of the  Effective  Date  (except for  Sections  5, 7 and 8 of the  Employment
Agreement,  which provisions survive the termination of the Employment Agreement
and, as modified hereby,  remain in full force and effect).  The 1996 "change of
control" severance agreement between Company and Klein is also hereby terminated
effective as of the Effective  Date. By his execution of this  Agreement,  Klein
hereby tenders his  resignation,  effective as of the Effective  Date,  from all
corporate  offices held by Klein with Company or any  subsidiary or affiliate of
Company and resigns,  effective  as of the  Effective  Date,  as a member of the
Board of  Directors  of Company  and such  resignations  are hereby  accepted on
behalf of Company and every such subsidiary and affiliate. Klein and the Company
acknowledge  that Klein did not attend or otherwise  participate in any Board of
Directors meetings that my have been held on or after the Effective Date.


          2. Klein and Company agree that all vested and unvested  stock options
for the  purchase of shares of  Company's  common  stock at any time  heretofore
granted to Klein (other than the "New  Options:  (as  hereinafter  defined)) are
hereby  cancelled  and  terminated  and  are  non-exercisable,  null  and  void,
effective as of the Effective  Date.  Company  hereby agrees that Klein's vested
stock options (the "New Options") for the purchase of shares of Company's common
stock granted pursuant to that certain Moovies, Inc.  Non-Qualified Stock Option
Agreement  substantially  in the form  attached  as  Exhibit A hereto  (the "New
Option  Agreement")  shall remain in full force and effect and be exercisable in
accordance  with its terms,  provided  such exercise is effected in any event no
later  than March 31,  1999 (or such  earlier  date as  provided  therein)  (the
"Option  Termination Date").  Thereafter,  any portion of such New Options which
has not been exercised shall be cancelled, terminated and made null and void.

          3.  Starting  from the  Effective  Date,  Klein  shall  receive (a) 12
months'  salary/compensation  payments (at the rate of $175,000 per annum), less
all applicable taxes and  withholdings,  if any, payable in bi-weekly or monthly
installments  in  accordance  with  customary  Company  procedures;  and (b) car
allowance (at the rate of $1,500 per month) for 12 months,  payable monthly; and
(c) 3 weeks'  vacation  pay (at the rate of $175,000  per annum),  payable on or
before  March 31,  1998.  (In the event  that,  at any time after May 31,  1997,
Company  fails to  timely  make when due a payment  described  in the  foregoing
sentence,  and such  default  continues  uncured for more than 10 business  days
following written notice thereof from Klein to Company,  then all unpaid amounts
described in the foregoing  sentence not  previously  paid to Klein shall become
immediately due and payable and, if thereafter Company receives a second written
notice  thereof  from Klein and such  default  continues  uncured  for more than
twenty  (20)  days  following  such  second  written  notice,   then  Klein  may
immediately exercise his one-time special election (as provided for in Section 7
of the New Option Agreement).) Klein may elect COBRA coverage as provided for by
law; if such coverage is elected,  Company agrees to reimburse  Klein,  promptly
following  submission of appropriate  documentation,  to the extent that Klein's
actual monthly COBRA contribution payments exceed the contribution amounts which
Klein would have paid under the  Company's  health plan if Klein had  remained a
full time  employee  of  Company  during the  period of actual  COBRA  coverage.
Company  will make  reasonable  efforts  to  assist  Klein in  obtaining  health
insurance  coverage for up to an  additional  18 months so long as such coverage
would involve no additional cost, exposure or risk to Company and, if it affects
the  Company's  health  plan,  Company's  reinsurer  shall  have given its prior
written consent.

          4. Klein agrees to provide consulting services to Company for up to 20
hours  per  month  for 6  months  following  the  Effective  Date as  reasonably
requested by Company on any matter,  and  thereafter as reasonably  requested by
Company  but  only in  connection  with  defense  or  settlement  of  claims  or
litigation  which  related to matters or events  occurring  during the period of
Klein's employment with Company. (If the above-mentioned 20-hour per month limit
is exceeded,  Klein's fee for additional  services in such month would be at the
rate of $750 per diem.) As a consultant,  Klein shall perform and carry out such
projects and assignments as reasonably  directed by the President of Company and
shall report to the President of Company.  All such consulting services shall be
provided by Klein to Company on an independent  contractor basis. Company agrees
to reimburse Klein, promptly following submission of appropriate  documentation,
for all  reasonable  out-of-pocket  travel  expenses (air (coach),  car,  hotel,
meals)  incurred  at  Company's  request  in  connection  with  such  consulting
services, claims or litigation.  In addition,  Company will provide to Klein (i)
use of an office until June 30, 1997 and (ii) continuing  answering/voicemail of
the direct dial phone number  previously  designated for Klein's use until March
31, 1998.

          5.  Employee  hereby  acknowledges  that  Company  is  engaged  in the
business of owning,  operating  and  licensing  video  specialty  stores for the
rental and sale of videos and video games and other related products, the rental
and sale of video  recorders,  players and video game  equipment and the sale of
video accessories,  cleaning equipment and confectionery items (the "Business of
the Company") at Company's  "Video Rental Store  Locations" (as defined  below).
Klein  covenants and agrees that, for a period starting as of the Effective Date
and  continuing  until one (1) year  after the "Final  Payment  Date" (as herein
defined),  he will not,  within a five (5) mile radius of any of Company's Video
Rental Store  Locations  (which 5-mile radius of each of such Video Rental Store
Locations  the  parties  hereto  agree is the  "Territory"),  without  the prior
written consent of Company, directly or indirectly,  (a) for himself or (b) as a
consultant, management, supervisory or executive employee or owner of a business
engaging in the same or  substantially  similar  business as the Business of the
Company ("Competing Business"),  or (c) as an independent contractor,  engage in
any  business  for which he  provides  services  to or on behalf of a  Competing
Business which are the same or  substantially  similar to the duties he executed
or the services he provided during his employment with Company.  As used herein,
"Video Rental Store  Locations"  shall mean those locations listed on Schedule A
delivered on or about the date of execution of this Agreement  (which  locations
the  parties  hereto  agree are those in  respect  of which  Klein has  provided
services or executed duties during his employment with Company). As used herein,
the  "Final  Payment  Date"  shall mean the  earlier  of (i) the actual  date of
payment,  if any, by Company of the amount  described in Section 7(b) of the New
Option Agreement or (ii) September 30, 1998.  Notwithstanding the foregoing, (a)
"Competing  Business"  shall  specifically  exclude any business whose revenues,
direct or indirect,  from rental or sale of videos,  video games and/or  related
products are less than 50% of its total  revenues and (b) any and all references
herein to "within the Territory"  shall be deemed deleted with respect to any of
the following  companies and their  affiliates (each of which shall be deemed to
be a "Competing  Business" on a national  basis):  Movie  Gallery,  Inc.,  Video
Update, Inc., Hollywood  Entertainment  Corporation,  Blockbuster  Entertainment
Corporation and West Coast Entertainment Corporation.

         6. All payments and benefits  hereunder,  as well as the exercisability
of the New Options and the one-time special  election  provided for in Section 7
of the New Option Agreement, are conditioned upon and subject to no "Default" or
"Event of Default" (as such terms are  hereinafter  defined) having occurred and
being then  existing.  The  payments and  benefits  expressly  provided to Klein
hereunder are in lieu of all other  entitlements which Klein may have at law, in
equity or by contract. As used herein, an "Event of Default" shall mean:

         (i)  default or failure by Klein to comply with any of the terms of (x)
this Agreement and/or (y) the Non- Competition Agreement dated August 9, 1995 by
and  between  Company  and Klein (the  "Non-Competition  Agreement")  and/or (z)
Section 5, 7 and/or 8 of the Employment Agreement as modified hereby; and

         (ii) such  default or failure to comply  shall  continue  uncured for a
period of 30 days following the giving of notice thereof by Company to Klein.

As used herein, a "Default" shall mean any event,  act or condition which,  with
notice  or  lapse  of  time,  or both,  would  constitute  an  Event of  Default
hereunder.

         7. All  Company  property  in Klein's  possession,  including,  but not
limited to, keys,  credit cards,  computers,  mobile or portable phones,  files,
documents,  correspondence, data and any other Company property and information,
will be returned to Company  immediately and Klein will not retain any copies or
reproductions of an property of Company.  All amounts owing by Klein to Company,
if any, will be repaid immediately.  Klein agrees that any and all amounts which
may be refundable in connection  with any termination of or change in membership
status at  Thornblade  Country  Club shall belong to (and shall be paid over to)
Company rather than Klein.

         8. Klein accepts the terms of the Agreement in full, final and complete
satisfaction  and  settlement  of any and all claims which in any way related or
pertain to or arise out of any past or present  employment of Klein with Company
or any of its  subsidiaries or affiliates.  Accordingly,  except as specifically
provided  in the  Agreement,  each of Klein and each  member of his family  does
hereby  release and  discharge  in full,  final and  complete  satisfaction  and
settlement  the Company and any and all of its  subsidiaries  and affiliates and
any and all of their past or present  employees,  officers,  agents,  directors,
attorneys or others  acting on behalf of any of the  foregoing  from any and all
actions,  causes of action,  suits,  debts, dues, sums,  covenants,  agreements,
damages, judgments, obligations,  liabilities, claims and demands whatsoever, in
law or in equity,  of whatever  nature or description  (collectively,  "Claims")
that any of them may have  which in any way relate or pertain to or arise out of
the past or present  employment of Klein with Company or any of its subsidiaries
or affiliates; provided, however, that Klein retains any and all Claims which he
may  hereafter  have  against  Company for breach by Company of this  Agreement.
Except as specifically  provided in this Agreement,  Company does hereby release
and discharge in full,  final and complete  satisfaction  and settlement each of
Klein and each  member of his family  from any and all Claims  that  Company may
have  which in any way  relate or pertain to or arise out of the past or present
employment  of Klein with  Company  or any of its  subsidiaries  or  affiliates;
provided,  however,  that  Company  retains  any and  all  Claims  which  it may
hereafter  have  against  Klein for breach by Klein of this  Agreement or if any
Default or Event of Default shall occur.

         9. It is further  understood and agreed that this Agreement is intended
to be a total accord,  settlement and  satisfaction  of any and all claims which
Klein has or may have against  Company or any of its  subsidiaries or affiliates
or  any of  their  past  or  present  employees,  officers,  agents,  directors,
attorneys or others  acting for or on behalf of the  foregoing in respect of his
employment,  including  but not  limited  to under any  federal,  state or local
statute,  ordinance or under the common law, including,  but not limited to, the
Age  Discrimination  in Employment  Act of 1967, as amended,  the Older Workers'
Benefit  Protection  Act, Title VII of the Civil Rights Act of 1964, as amended,
the Civil Rights Act of 1991, the Employee  Retirement  Income  Security Act, 29
U.S.C.,  et seq., 42 U.S.C.  Section 1981, the Americans with  Disabilities Act,
the Equal Pay Act, the Fair Labor  Standards Act, the Workers  Compensation  Act
and any other employment  discrimination  law, as well as any other claims based
on contract or any constitutional,  statutory, common law or regulatory grounds,
that  he has  now or  may  have  in the  future  against  Company  or any of its
subsidiaries or affiliates, whether known or unknown, which are based on acts or
facts  arising  or  occurring  prior  to  the  date  of  this  Agreement.  Klein
acknowledges that, pursuant to the Older Workers Benefit Protection Act of 1990,
he has the right to, and has been advised to,  consult  with an attorney  before
signing this Agreement. He further acknowledges his understanding that he has 45
days to  consider  the  release  contained  in  Section  9 before  signing  this
Agreement,  that he may revoke the release  contained  in this Section 9 of this
Agreement with seven  calendar days after signing it, and the release  contained
in this Section 9 of this Agreement  will not be effective or enforceable  until
expiration of that seven-day revocation period.

         10. Klein  acknowledges  that Klein has had the  opportunity to consult
with an  attorney  with  respect to the terms of this  Agreement  including  the
general release set forth above.

          11. (a) For a period of two years  starting with the  Effective  Date,
Klein agrees to fully  cooperate with Company and to provide all information and
sign any corporate records and instruments that Company may hereafter reasonably
request  with  respect  to  any  matter  involving  Klein's  present  or  former
relationship with Company, the work Klein has performed, the compensation he has
received,  or  present  or  former  employees,  customers,  vendors  or  service
providers of Company,  defense or settlement of any claim or litigation asserted
against Company,  this Agreement,  the Purchase Agreement and related documents,
and is required or, in the Company's  reasonable good faith belief, is desirable
in respect of any filings or reports made, or information  given,  by Company in
respect of state or federal securities or other laws.

          (b) For a period of two years starting with the Effective Date,  Klein
agrees not to make slanderous or disparaging  remarks  concerning Company or any
of its  subsidiaries  or  affiliates  or any of their past or present  officers,
directors,  employees,  agents,  attorneys  to any  person or entity  and,  more
specifically,  Klein will not make any such statements to, or otherwise  attempt
to be a negative  influence on, any past or present  employee of Company.  For a
period of two years starting with the Effective Date, Company agrees not to make
slanderous or disparaging remarks concerning Klein.

          (c) Klein understands and agrees that as a condition  precedent to the
receipt by Klein of  consideration  described in this  Agreement,  the terms and
conditions of this  Agreement,  the New Option  Agreement and any  underlying or
related  agreements or documents,  shall be kept  confidential by Klein,  except
when  disclosure  may be  required by law or by order of any court or other body
with the authority to make such an order.

          (d) Except as specifically modified, amended or terminated as provided
herein, Klein and Company acknowledge and agree that the Purchase Agreement, the
Non-Competition  Agreement and all other  agreements,  documents and instruments
delivered  pursuant to or in connection with the Purchase  Agreement (other than
the Employment  Agreement) remain in full force and effect and unchanged hereby;
except for  Section 5, 7 and 8 of the  Employment  Agreement  (which  provisions
survive the  termination  of the Employment  Agreement and, as modified  hereby,
remain in full force and effect),  the Employment Agreement is hereby terminated
as of the  Effective  Date.  No  amendment  or waiver of this  Agreement  or any
provision  hereof shall be effective unless in writing signed by the party to be
so bound.  In the event that any provision of this Agreement  shall be held void
or unenforceable,  the remaining  portions hereof shall remain in full force and
effect and this Agreement  shall be deemed amended to excuse such  provisions to
the extent that they were held void or  unenforceable  and,  as  amended,  shall
continue in full force and effect. This Agreement shall inure to the benefit of,
and be binding upon, the parties hereto and their respective  heirs,  executors,
administrators,  personal  representatives,  successors and assigns. Company may
assign this Agreement provided,  however,  that any assignment of this Agreement
by Company  without the written  consent of Klein will not release  Company from
its obligations hereunder.


          (e) All notices,  requests,  demands,  claims or other  communications
hereunder  will be in  writing  and shall be  deemed  duly  given if  personally
delivered,  sent by telefax, or sent by a recognized  overnight delivery service
which guarantees next day delivery  ("Overnight  Delivery") or mailed registered
or certified mail,  return receipt  requested,  postage prepaid,  transmitted or
addressed to the intended recipient as set forth below:

If to Klein:               Mr. Robert J. Klein
                           43 Latour Way
                           Greer, SC 29650

                           with a copy to:
 
                           Howard N. Greenberg, Esq.
                           Kleinbard, Ball & Brecker
                           Suite 700
                           1900 Market Street
                           Philadelphia, PA  19103
                           Telefax: (215) 568-0140

If to Company:             Moovies, Inc.
                           201 Brookfield Parkway
                           Suite 200
                           Greenville, SC  29607
                           Attention: President
                           Telefax: (864) 213-1702

                           and
 
                           Moovies, Inc.
                           201 Brookfield Parkway
                           Suite 200
                           Greenville, SC  29607
                           Attention: General Counsel
                           Telefax: (864) 213-1702


 (i) by personal delivery or telefax, will be deemed received on the day sent or
on the first  business day  thereafter  if not sent on a business  day,  (ii) by
Overnight  Delivery,   will  be  deemed  received  on  the  first  business  day
immediately  following  the date sent,  and (iii) by U.S.  mail,  will be deemed
received  three (3)  business  days  immediately  following  the date sent.  For
purposes of this  Agreement,  a "business day" is a day on which Company is open
for  business  but shall  not  include a  Saturday  or Sunday or legal  holiday.
Notwithstanding  anything  to the  contrary  in this  Agreement,  no  action  is
required on a day which is not a business  day, such action shall be required to
be performed on the next succeeding day which is a business day.


<PAGE>


RECEIPT: I acknowledge  receipt of a copy of this Agreement this ___ day of May,
1997.  Unless and until I execute  this  Agreement  in the other space  provided
below, I have not agreed to it.


-----------------------------------
Robert J. Klein
Signature for Purposes of Receipt Only



<PAGE>


I HAVE READ THIS AGREEMENT AND UNDERSTAND THAT I AM GIVING UP IMPORTANT  RIGHTS.
I AM AWARE OF MY RIGHT TO CONSULT AN  ATTORNEY  BEFORE  SIGNING  AND HAVE SIGNED
BELOW KNOWINGLY AND VOLUNTARILY.


                                            ROBERT J. KLEIN
 
                                            ------------------------------------
                                            PRINTED NAME


                                            ------------------------------------
                                            SIGNATURE
                                            Date Signed:  May ___, 1997
 
Sworn to and subscribed before me 
this ___ day of May, 1997.

----------------------------
Notary Public


                                             MOOVIES, INC.

                                             By: ______________________________
                                             Its:  President
                                             Date Signed:  May ___, 1997

Sworn to and subscribed before me 
this ___ day of May, 1997.

----------------------------
Notary Public