<PAGE>

                                                                    EXHIBIT 10.4

AGREEMENT made this 22nd day of August, 2000, between METRO-GOLDWYN-MAYER
STUDIOS INC., a Delaware corporation, (hereinafter referred to as "MGM") and
MICHAEL R. GLEASON (hereinafter referred to as "Executive").

                                 W I T N E S S E T H
                                 -------------------

1.   MGM hereby engages Executive's non-exclusive services as a part-time
     employee for the five (5) year period beginning August 22, 2000 and ending
     August 21, 2005 (the "Term").

     Executive agrees to devote his best efforts to the business of MGM (or its
     present or future parents, subsidiaries, affiliates or successor companies)
     as MGM may request and as may be consistent with the duties of Executive's
     position.  Executive hereby represents and warrants that he is legally able
     to enter into this agreement and that he has no other agreements or
     commitments with any third parties which would preclude or prevent him from
     entering into this agreement and rendering his services hereunder.
     Executive hereby agrees to be bound by the terms and conditions of Metro-
     Goldwyn-Mayer Inc.'s Code of Conduct and Conflict of Interest Policy, which
     terms and conditions are incorporated herein by reference.

2.   Executive shall provide executive services for MGM's parent company, Metro-
     Goldwyn-Mayer Inc., in the areas of capital markets and corporate strategy.
     Executive's duties shall be as assigned from time to time by the Chairman
     and Chief Executive Officer ("CEO") of Metro-Goldwyn-Mayer Inc. (presently
     Alex Yemenidjian).  Executive shall report solely to the CEO.

3.   Provided Executive shall perform his obligations hereunder, MGM shall pay
     Executive a salary at the rate of Twenty-Five Thousand Dollars ($25,000.00)
     per year during the Term, payable bi-weekly in accordance with MGM's
     standard payment practices.

4.   Metro-Goldwyn-Mayer Inc. presently maintains an Amended and Restated 1996
     Stock Incentive Plan.  In further consideration of the services to be
     rendered by Executive hereunder, Executive shall be granted an option to
     purchase 300,000 shares of Metro-Goldwyn-Mayer Inc. Common Stock, $.01 par
     value per share, at an exercise price equal to the market price of the
     Common Stock on the date of grant but in no event less than $14.90 per
     share.  As contemplated herein, such option will, among other things, be
     effective as of the date of grant and will be exercisable in accordance
     with the terms and restrictions contained in the standard Executive Stock
     Option Agreement issued by Metro-Goldwyn-Mayer Inc. as of the date of grant
     with such changes therein as are necessary to implement the provisions of
     this Paragraph 4.  Such options shall vest at the rate of 20% on the first
     anniversary of the date of grant and thereafter at the rate of 1/60 per
     month until fully vested.

5.   Executive shall be entitled to incur and be reimbursed for reasonable
     expenses (including first class travel) in connection with the performance
     by Executive of his duties hereunder.  Such reimbursement shall be made on
     the basis of statements thereof (together with vouchers or documents
     evidencing such expenses) furnished by Executive to MGM in accordance with
     MGM's standard practices.

                                       1
<PAGE>

6.   Executive agrees that all the results and proceeds of his services
     hereunder, including any ideas, programs, formats, plans and arrangements,
     composed, conceived or created by him during the Term of this agreement,
     solely or in collaboration with others, whether or not same is made at the
     request or suggestion of MGM, or during or outside regular hours of work,
     shall at all times be and remain the sole and exclusive property of MGM.
     Executive further agrees that he will, at the request of MGM, execute and
     deliver to MGM, in form satisfactory to MGM, documents evidencing MGM's
     ownership to the foregoing; but notwithstanding that no such documents are
     executed, MGM, as Executive's employer, shall be deemed the owner thereof
     immediately upon creation.  All memoranda, notes, records, and other
     documents made or compiled by Executive in connection with his services
     hereunder, or made available to him during the Term of this agreement,
     shall remain the sole and exclusive property of MGM, and Executive
     undertakes, upon termination of this agreement, to return to MGM all such
     documents, whether originals, copies or reproductions.  Executive shall not
     use for himself, or others, any secret or confidential information,
     knowledge or data of MGM (or any of its affiliates) obtained by Executive
     as a result of his employment by MGM.  Anything in this agreement to the
     contrary notwithstanding, the provisions of this paragraph shall survive
     the termination, for any reason, of this agreement.

7.   Executive agrees that MGM may deduct and withhold from the payments to be
     made to Executive hereunder, the amounts required to be deducted and
     withheld by MGM under the provisions of any statute, law, regulation or
     ordinance heretofore or hereafter enacted.

8.   Any notices provided for herein may be given by personal delivery, by
     telecopy or other form of written electronic transmission, by overnight
     courier or by certified or registered mail postage prepaid, addressed as
     follows:

     (a)    To MGM  -      Metro-Goldwyn-Mayer Studios Inc.
                           2500 Broadway Street
                           Santa Monica, CA 90404
                           Attn.: William A. Jones
                                  Senior Executive Vice President

     (b)    To Executive - Michael R. Gleason
                           c/o Celsus Financial Corp.
                           201 Main Street, Suite 1955
                           Fort Worth, TX  76102

or to such other address as may hereinafter be designated in writing by the
party concerned. The date of delivery to the post office, overnight courier or
cable office, all postage or other charges prepaid, shall be deemed the date of
delivery hereunder.

9.   MGM shall have the right to assign this agreement to any subsidiary,
     successor or parent company of MGM or to any other person, firm or
     corporation which acquires MGM and/or Metro-Goldwyn-Mayer Inc. or a
     substantial part of MGM's or Metro-Goldwyn-Mayer Inc.'s assets or into
     which MGM and/or Metro-Goldwyn-Mayer Inc. may merge  The

                                       2
<PAGE>

     obligations and duties of Executive hereunder are personal and not
     assignable.

10.  In the event of the termination of Executive's employment with MGM for any
     reason and for a period of one (1) year thereafter:

     (a)  Neither Executive nor any third party for whom Executive is then
          rendering services shall solicit any employee of MGM at the level of
          Vice President or above to perform services for Executive and/or such
          third party; and

     (b)  Executive shall not make any public statement concerning MGM or any of
          its affiliates or subsidiaries or relating to Executive's employment
          with MGM unless previously approved by MGM, except as may be required
          by law.

11.  Except with respect to any disputes which may arise pursuant to Paragraph
     6, any controversy or claim between or among Executive, MGM or any of its
     affiliates arising out of or relating to this agreement or any breach
     thereof shall be submitted to final and binding arbitration.  Any such
     arbitration shall be held in Los Angeles, California before an experienced
     employment arbitrator licensed to practice law in California and selected
     in accordance with the Model Employment Arbitration Procedures of the
     American Arbitration Association.  Such arbitration shall be conducted in
     accordance with the Commercial Rules of the American Arbitration
     Association.  The arbitration proceedings shall be conducted in English.
     The arbitration proceedings, all documents related thereto and all
     testimony, written or oral, and the arbitration award shall be
     confidential, except with respect to any proceedings commenced to compel
     arbitration or to enforce the arbitration award or as otherwise required by
     law.  The provisions of California Code of Civil Procedure (S)1283.05 are
     hereby incorporated by reference.  Each party hereto agrees that once an
     arbitration request has been made by either party that each party will
     proceed expeditiously to commence and complete the arbitration proceedings,
     with the intent of completing same within three months.

12.  This agreement shall be construed under the laws of the State of California
     applicable to contracts executed and fully performed therein.  The state
     and federal courts (or arbitrators appointed as described herein) located
     in Los Angeles, California shall be the sole fora for any action for relief
     arising out of or pursuant to, or to enforce or interpret, this agreement.
     Each party to this agreement consents to the personal jurisdiction and
     arbitration in such fora and courts and each party hereto covenants not to,
     and waives any right to, seek a transfer of venue from such jurisdiction on
     any grounds.  No waiver of one provision shall constitute a continuing
     waiver or a waiver of any other provision or default hereof.  If any
     provision of this agreement is held to be unenforceable for any reason, it
     shall not affect the enforceability of any other provision of this
     agreement.  The parties agree that there is separate consideration for each
     provision of this agreement and that all of the provisions of this
     agreement are severable.  This agreement constitutes and contains the
     entire agreement and final understanding concerning Executive's employment
     with MGM and the other subject matters addressed in this agreement.  It is
     intended by the parties as a complete and exclusive statement of the terms
     of their agreement.  It supersedes and replaces all prior negotiations and
     all agreements, proposed or otherwise, whether written or oral, concerning
     the subject matter hereof.  Any representation, promise or agreement not
     specifically included in this agreement shall not be binding or enforceable
     against either party.  This is a

                                       3
<PAGE>

     fully integrated agreement and may be amended, modified, renewed or
     extended only by a writing signed by both parties.

                                       4
<PAGE>

     IN WITNESS WHEREOF, the parties have hereunto affixed their signatures the
day and year first hereinabove written.

                                        METRO-GOLDWYN-MAYER STUDIOS INC.



                                        By: /s/ Williams A. Jones
                                            --------------------------------
                                            Senior Executive Vice President


                                        /s/ Michael R. Gleason
                                        ------------------------------------
                                        MICHAEL R. GLEASON


                                       5