EXHIBIT 10


                               MOVIE GALLERY, INC.
                                   AGREEMENT









                           MAJOR VIDEO CONCEPTS, INC.
                                INDIANAPOLIS, IN
                                AUGUST 15, 1997
                         ** - EXECUTIVE VICE PRESIDENT
                              ** - BRANCH MANAGER










**Confidential portions of this agreement have been omitted and filed separately
with  the  Securities  and  Exchange   Commission  pursuant  to  a  request  for
confidential treatment.

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<PAGE>



Major Video Concepts, Inc. (MVC) hereby agrees to fulfill all of Movie Gallery's
needs  of  product  and  services  referred  to  below  during  the term of this
agreement.

Movie  Gallery  agrees to make MVC the primary  distributor  of video rental and
sell-thru product during the term of this agreement.

Pricing:
- ** for new release  rental  cassettes  and video  games.  Movie  Gallery cost
  is calculated by **.
- New  feature  sell-thru  titles  (limited  to first  time  releases  that have
  theatrical box office) **. New feature  sell-thru titles can be stock balanced
  at ** of MVC's and Movie
     Gallery's  agreed upon  quantity  ordered for unopened  and factory  sealed
     product.
- ** on Touch-Tell orders and year-round rack/new tape inventory.  Movie Gallery
  cost is calculated by **.

Pre-pack Pricing:
If a price break is available on a per-pack versus single units, **.

**

Inventory:
Catalog product is purchased weekly by MVC's product managers.  Inventory levels
will be customized to fit Movie Gallery's needs.

Premiums:
Promotions  offered by the  studios or MVC will be honored and  administered  by
MVC. Customized premiums can be produced as part of Movie Gallery's  advertising
program.

Terms:
- ** days on PVT rack program and "Plan O Gram" catalog  (initial  order).  - **
days on everything else from invoice date (see Attachment I).
- **
- Payable **

Freight:
MVC will prepay UPS, GPS, or RPS ground shipping  charges on **. Prepaid freight
includes shipments from any of MVC's shipping locations.

**Confidential portions of this agreement have been omitted and filed separately
with  the  Securities  and  Exchange   Commission  pursuant  to  a  request  for
confidential treatment.


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<PAGE>


Shipping  arrangements  can be made so that your new release product will arrive
at your stores **.

Rental Ready Processing:
Should  you  desire,  MVC is  prepared  to ship your  product  ready for  rental
according to your specifications. **

Returns:
Catalog  titles ($29.99 retail or less) can be stock balanced at ** of MVC's and
Movie  Gallery's  agreed upon quantity  ordered for unopened and factory  sealed
product.  Stock balancing should be exercised within ** days of purchase.  Event
titles should be returned within ** days of purchase.

Manufacturer's  defective  product  will be replaced one for one within the time
constraints  imposed upon MVC by the  studios.  MVC will honor  No-Fault  Return
Policies  as  offered  by the  studios.  Return  authorization  numbers  will be
assigned  immediately  upon  notification  of a defective  tape and  replacement
product will be shipped. **

Employees:
In house sales rep $**/year
Advertising Assistant  $**/year
Movie Gallery Special Account Rep $**/year

Interviewing and job description  will be agreed upon by both parties.**

Co-op  Advertising:
**co-op on "co-opable" new release,  catalog or event title product. MDF will be
secured by Movie Gallery. **

Advertising  claims will be **.

P.O.P. Materials:
P.O.P.  material will be shipped monthly **.

Annual Meeting:
MVC will contribute $** during the length of this contract for **.

New Release  Orders:
A disk with Movie  Gallery's new release  orders would need to be given to ** so
that we could upload the pre-orders.  We would also like to have a disk to input
your store ship-to locations. An Excel/Lotus spreadsheet or ASCII file will work
for these files. The files could also be transmitted via modem,  eliminating the
mailing of a disk.

**Confidential portions of this agreement have been omitted and filed separately
with  the  Securities  and  Exchange   Commission  pursuant  to  a  request  for
confidential treatment.

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<PAGE>



Additional  Features  from  MVC's  Spotlight  Program:

     "Diamonds  In The Rough"
     A bi-monthly  program of 8 - 10  secondary  titles that are selected by the
     MVC sales force according to quality, genre,  star-power,  and rentability.
     Purchase a minimum  number of six titles and  receive  one scratch off card
     per unit purchased. Currently, the winning cards reveal a 20" TV/VCR combo,
     RCA stereo VCR, Sharp facsimile  machine,  or Sony Playstation that will be
     sent to you within 15 days.

     Touch-Tell
     We would set up one master account for billing  purposes.  Each store would
     have its own open to buy and  catalog  account  numbers  under  the  master
     account.  A credit line of  $**/month  will be  established  for each Movie
     Gallery's open to buy account.

     MVC and Movie Gallery are currently set up to service ** stores.  ** stores
     will be active by September 1. All stores will be sent MVC current catalog.

     Buy Back Program:
     MVC and Movie Gallery will discuss opportunities for both companies.

     World Wide Web Site (Optional):
     MVC will  create  and  maintain  a web  site for each of your  stores - all
     updated  weekly - for a $10  set-up  fee and $10 a month.  Your  page  will
     feature your store logo, store information, location, rental rates and your
     e-mail  address  (optional).  Your web page will also  provide  new release
     information,  titles coming soon, top 40 videos, special orders, listing of
     DVD  titles for sale,  and a special  kids  page.  You will also  receive a
     counter card telling your customers to visit you on your web site.

     Internet Broadcast or Majorfax:
     Receive  daily  information  on PPV windows,  weekend box office  hits,  TV
     movies, video games, etc.

     Weekly  Magazine:
     MVC produces  one of the best and most  respected  weekly  magazines in the
     industry.

     Spotlight on Video Hits  Consumer  Flyers:
     MVC  provides  month  in-store  flyers  cross-promoting  current  video new
     releases with similar catalog favorites to produce  incremental rentals and
     increase consumer satisfaction.

Length of Program:
We request that Movie Gallery commit to MVC beginning ** and ending **.

**Confidential portions of this agreement have been omitted and filed separately
with  the  Securities  and  Exchange   Commission  pursuant  to  a  request  for
confidential treatment.

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<PAGE>


Account  Representation:
MVC offers the  following  personnel  to assist  your needs:  - **  (President),
Indianapolis,  IN - ** (Executive Vice President, Sales), Indianapolis,  IN - **
(Senior  Vice  President,  Marketing),   Indianapolis,  IN  -  **  (Senior  Vice
President,  Operations and Purchasing),  Indianapolis,  IN - ** (Vice President,
Controller), Indianapolis, IN - ** (National Credit Manager), Indianapolis, IN -
** (Branch Manager), Birmingham, AL - ** (Advertising Coordinator),  Birmingham,
AL - ** (Account Executive), Birmingham, AL

Business  Interruption  Clause:
If MVC fails to delivery new release  rental and special  event titles by street
date,**.  If our shipping  company,  studios,  or inclement  weather causes late
arrival of new release rental and special event titles, **.

The above paragraph is not enforceable  during the current UPS strike.  MVC will
attempt to do everything  within reason (postal service,  truck line, will call)
to get Movie  Gallery  their  product by street date.  Once the UPS strike ends,
this paragraph becomes void.

Breach of Agreement:
If either party breaches or fails to adhere to the terms of this agreement,  the
party who has breached or failed to adhere to the said terms will be notified in
writing  via  certified  mail by the  other  party as to the  nature of the said
offense.

The party who has breached the terms of this  agreement  shall have ** days from
the date of  notification  to correct said  offense.  If the said breach has not
been  corrected  within the ** days,  the opposing party shall have the right to
terminate this agreement.

Agreed and accepted this 19th day of August, 1997 by:

MOVIE GALLERY,  INC. and                MAJOR VIDEO CONCEPTS, INC.
MGA, INC.

/s/ J. T. Malugen                       /s/ Douglas B. Meadows
-----------------------------           ------------------------------
J. T. Malugen, Chairman and             Douglas B. Meadows - President
Chief  Executive  Officer


/s/ J. S. Roy                           /s/ Eric H. Smith
-----------------------------           ------------------------------
J. S. Roy, Sr. Vice President           Eric H. Smith - 
and Chief  Financial  Officer           Executive Vice President

**Confidential portions of this agreement have been omitted and filed separately
with  the  Securities  and  Exchange   Commission  pursuant  to  a  request  for
confidential treatment.

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<PAGE>



 

EXAMPLES OF PRICING
 

Schedule A: Rental  Product**

                              Retail  Price       Dealer Price        MGA Price
Father's Day                  NSRP                $79.50              $**
McHale's Navy                 NSRP                $79.50              $**
Saint, The                    NSRP                $79.25              $**
Silent Trigger                NSRP                $79.50              $**
Commandments                  NSRP                $79.50              $**
English Patient               NSRP                $81.75              $**
Selena                        NSRP                $79.50              $**
B.A.P.S.                      NSRP                $79.00              $**
Volcano                       NSRP                $79.25              $**
Anaconda                      NSRP                $81.75              $**
That Old Feeling              NSRP                $79.50              $**
Grosse Point Blank            NSRP                $79.50              $**
Night Falls on  Manhattan     NSRP                $76.50              $**
Sixth Man                     NSRP                $79.50              $**
Addicted to Love              NSRP                $79.50              $**
Austin  Powers                NSRP                $80.50              $**
Fifth Element                 NSRP                $81.75              $**

Schedule B:  Sell-Thru  Event Title  Pricing

Sleeping Beauty               $26.99              $20.25              $**
Casper:  A Spirited Being     $19.98              $15.25              $**
Warriors of Virtue            $19.98              $15.25              $**
Liar,  Liar                   $22.98              $17.25              $**
Babes in Toyland              $19.98              $15.25              $**
Hercules  and Xena            $19.98              $15.25              $**
Jungle Book                   $26.99              $20.25              $**
Jingle All the Way            $19.98              $15.25              $**

Schedule C: Buy Back Pricing  Examples

                              MGAPrice           Buy Back         MGA Net Price
Father's Day                  $**                 $**                 $**
McHale's Navy                 $**                 $**                 $**
Saint,  The                   $**                 $**                 $**
Silent  Trigger               $**                 $**                 $**
Commandments                  $**                 $**                 $**
English Patient               $**                 $**                 $**
Selena                        $**                 $**                 $**
B.A.P.S.                      $**                 $**                 $**
Volcano                       $**                 $**                 $**
Anaconda                      $**                 $**                 $**
That Old Feeling              $**                 $**                 $**
Grosse Point Blank            $**                 $**                 $**
Night Falls on  Manhattan     $**                 $**                 $**
Sixth Man                     $**                 $**                 $**
Addicted to Love              $**                 $**                 $**
Austin  Powers                $**                 $**                 $**
Fifth  Element                $**                 $**                 $**
 
**Confidential portions of this agreement have been omitted and filed separately
with  the  Securities  and  Exchange   Commission  pursuant  to  a  request  for
confidential treatment.


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<PAGE>


                                  ATTACHMENT 1

     PAYMENT   INV. START   INV.END   HIGH DAYS   LOW DAYS     AVERAGE DAYS

                                       **

                                Average Days                   **


**Confidential portions of this agreement have been omitted and filed separately
with  the  Securities  and  Exchange   Commission  pursuant  to  a  request  for
confidential treatment.


                                       7
<PAGE>

                                                                (MVC Letterhead)


August 20, 1997

Mr. Joe Malugen
Movie Gallery Inc.                                                      Via Fax

Dear Joe:

This letter shall  constitute an addendum to the  agreement  between Major Video
Concepts,  Inc. (MVC) and Movie  Gallery,  Inc. dated August 19, 1997 to add the
following items:

1) All  returns on product  sold to Movie  Gallery **. All other  returns  would
be**. In those situations where product is re-priced by the vendor, MVC will **.
If Movie Gallery does not return all affected product,  **

2) Both parties agree to maintain  strictest  confidentiality of this agreement.
Only those within each  organization  that are involved in the execution of this
agreement  or those  with a need to know  shall be  advised of the terms of this
agreement.

3) Movie Gallery  agrees to mail to **, CFO for MVC, their  quarterly  financial
statements  within 45 days of the end of their fiscal  quarters.  Movie  Gallery
will send their  year-end  financial  statements to John White within 90 days of
the end of their fiscal calendar year.

4) MVC is  establishing  a credit line of $** for Movie Gallery which will allow
them to purchase product at their current  purchasing  levels. Any request for a
higher credit line during this agreement will be reviewed by MVC.

**

In all other respects the agreement is hereby reaffirmed according to its terms.



/s/ Douglas B.  Meadows                      /s/ J. T.  Malugen
------------------------------               --------------------
Douglas B. Meadows,  President               Joe Malugen
                                             Movie  Gallery  Inc.


/s/ Eric H. Smith
------------------------------
Eric H. Smith,
Executive Vice President




**Confidential portions of this agreement have been omitted and filed separately
with  the  Securities  and  Exchange   Commission  pursuant  to  a  request  for
confidential treatment.

  


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