Moovies, Inc.
                             201 Brookfield Parkway
                                    Suite 200
                              Greenville, SC 29607

                                  June 18, 1997

Mr. F. Andrew Mitchell
Chief Financial Officer
Moovies, Inc.
201 Brookfield Parkway
Suite 200
Greenville, SC  29607

Dear Andy:

         This letter is to set forth the terms and provisions  pursuant to which
you are, effective on the date hereof,  entitled to receive certain payments and
consideration  in the event there is a Change of Control (as defined  herein) of
Moovies,  Inc., provided that you are employed by Moovies, Inc. on the date that
such Change in Control occurs (even if the term of your employment agreement (if
any) has expired).  For purposes of this letter,  the  "Company"  shall refer to
Moovies, Inc., or, as appropriate,  to the successor to the business of Moovies,
Inc.,  if a Change in Control  shall  occur in which  Moovies,  Inc.  is not the
surviving corporation. The Company has agreed to provide you with these benefits
in  consideration  of your  contributions  to the Company and for other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged  by you and the Company.  These payments and  consideration  are in
addition to the compensation you are entitled to under your employment agreement
(if any) and in addition to all options now or hereafter granted to you.

         1. Definition of "Change of Control".  As used herein, the term "Change
of Control" means the occurrence of any of the following:

                  (a) any  person or entity,  including  a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended,  other than
the Company,  a wholly owned subsidiary of the Company,  or any employee benefit
plan of the Company or its  subsidiaries,  becomes the  beneficial  owner of the
Company's  securities  having 51 percent or more of the combined voting power of
the then outstanding securities of the Company that may be cast for the election
for directors of the Company; or

                  (b) as the result of, or in connection  with,  any cash tender
or  exchange  offer,  merger or other  business  combination,  sale of assets or
contested election, or any combination of the foregoing transactions,  less than
a majority of the combined  voting power of the then  outstanding  securities of
the Company or any successor corporation or entity entitled to vote generally in
the  election of directors  of the Company or such other  corporation  or entity
after



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Mr. F. Andrew Mitchell
Chief Financial Officer
June 18, 1997
Page 2


such  transaction,  are  held  in the  aggregate  by  holders  of the  Company's
securities  entitled  to vote  generally  in the  election of  directors  of the
Company immediately prior to such transaction; or

                  (c) the approval of the  shareholders of the Company of a plan
of liquidation.

         2. Effect of Change of Control.  If there is a Change of Control of the
Company,  and (i) you resign your employment within six months after such event,
or (ii)  you  are  terminated  without  cause  (as  defined  in your  employment
agreement (if any) with the Company; otherwise, as defined in your Non-Qualified
Stock Option Agreement - 1995 Stock Plan with the Company) by the Company within
six months after such event, you shall be entitled to receive an amount, payable
in a lump sum within 30 days after the  effective  date of such  resignation  or
termination,  equal to the product of your  average  total  annual  compensation
(defined  for  purposes  of this  Section as the  average  annual  total of your
compensation  includable in taxable  income for federal tax purposes,  including
without limitation,  Base Salary, Annual Bonus, all insurance benefits costs and
car  allowance  (collectively,   "Compensation"),   during  the  two  (2)  years
immediately  preceding the  termination of your  employment (or if you have been
employed  for less  than 2 years on the date of such  termination,  the total of
your  Compensation  for such full year, if any, and  compensation  includable in
taxable  income for federal tax purposes,  including  without  limitation,  Base
Salary,  the maximum Annual Bonus to which you would be entitled,  all insurance
benefit costs and car  allowance  for such partial year on an annualized  basis)
multiplied  by 3.  Serving  as a director  of the  Company,  or the entity  that
controls the Company,  after a Change of Control will not constitute  employment
by the Company.  In the event that any payment to be received by you pursuant to
this  Section 2 or the value of any  acceleration  right  occurring  pursuant to
Section 3 of this  Agreement  in  connection  with the  Change of Control of the
Company  would be  subject  to an excise tax  pursuant  to  Section  4999 of the
Internal  Revenue Code of 1986 (the  "Code"),  whether in whole or in part, as a
result of being an "excess parachute payment" within the meaning of such term in
Section  280G(b) of the Code,  the amount  payable under this Section 2 shall be
reduced  so that no portion  of such  payment or the value of such  acceleration
rights is subject to excise tax  pursuant  to Section  4999 of the Code.  If the
amount  necessary  to  eliminate  such excise tax  exceeds the amount  otherwise
payable under this Section 2, no payment shall be made under this  paragraph and
no further adjustment shall be made. Notwithstanding the preceding sentence, (a)
no portion of such payment or any acceleration right which tax counsel, selected
by the Company's  independent  auditors and acceptable to you, determines not to
constitute a "parachute payment" within the meaning of Section 280G(b)(2) of the
Code  will be  taken  into  account  and (b) no  portion  of the  total  of your
compensation which tax counsel,  selected by the Company's  independent auditors
and acceptable to you, determines to be reasonable compensation for


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Mr. F. Andrew Mitchell
Chief Financial Officer
June 18, 1997
Page 3

services  rendered within the meaning of Section  280G(b)(4) of the Code will be
taken into account.

         3. Effect of Change of Control on Options.  In the event of a Change of
Control,  all  options  granted  to you prior to such  Change of  Control  shall
immediately  vest and be  exercisable by you,  regardless of your  employment or
termination of employment with the Company.

         If the foregoing is acceptable to you, please sign where provided below
and return a signed original of this letter to me.

                                      Yours truly,

                                      MOOVIES, INC.


                                      John L. Taylor
                                      Chairman of the Board, President and
                                      Chief Executive Officer

Accepted and Agreed:

________________________________[Signature]
F. Andrew Mitchell

____________________[Date]