Movie Gallery Announces Approval of Amendments to Senior Credit Facility

DOTHAN, Ala., September 23, 2005 -- Movie Gallery, Inc. (NASDAQ: MOVI) today
announced that it has entered into an amendment of the Company's $870.0
million senior secured credit facility with its bank group.

The amendment provides for an additional $50.0 million of borrowings under
the facility's Term Loan B tranche.  The amendment also relaxes, for a one-
year period, the required ratio levels under the financial covenants
contained in the credit facility.  The amendment also increases the letter of
credit sublimit under the revolving credit facility from $30.0 million to
$40.0 million, but does not increase the overall revolving commitment amount.

Under the terms of the amendment, the interest rate on Movie Gallery's Term
Loan B increases from London Interbank Offered Rate ("LIBOR") plus 3.00% to
LIBOR plus 3.75% (and effecting an equivalent increase in margin under the
base rate option applicable to the Term Loan B).  Furthermore, an additional
tier has been added to the pricing grid contained in the senior credit
facility.  The additional tier is applicable to the revolving loan and Term
Loan A tranches of the facility and provides that if the Company's leverage
ratio, defined as total debt to EBITDA (as defined under the credit
agreement), exceeds 3.25 times, then the interest rate margin applicable to
revolving loans and Term Loan A will be 3.50% over LIBOR (and 2.50% over the
base rate).

As a condition to obtaining the consent of the lenders to the foregoing
amendments, Movie Gallery has agreed to pay an amendment and consent fee
equal to 0.25% of the aggregate total commitments of those lenders that
consent to the amendments, including those lenders that provide the
additional $50.0 million of borrowings under Term Loan B.  The Company also
agreed to provide certain additional prepayment protections to the Term Loan
B lenders and to certain changes to the excess cash flow sweep contained in
the existing credit agreement.

As part of this amendment, the Company disclosed that it has received a
notice from Mark Wattles, the founder and former CEO of Hollywood
Entertainment, exercising a contractual right to require the Company to
purchase 20 Hollywood Video stores currently owned by an entity controlled by
Wattles pursuant to a "put" option contained in the license agreement for
these stores.  A portion of the funds available to Movie Gallery under the
increased Term Loan B will be used to satisfy this obligation.  The remainder
of the additional borrowings under Term Loan B will be used for other general
corporate purposes.



About Movie Gallery

Movie Gallery is the second largest North American video rental company with
annual revenue in excess of $2.6 billion and approximately 4,800 stores
located in all 50 U.S. states, Canada and Mexico. Since the Company's initial
public offering in August 1994, Movie Gallery has grown from 97 stores to its
present size through acquisitions and new store openings.

Forward Looking Statements

To take advantage of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, you are hereby cautioned that this release
contains forward-looking statements that are based upon the Company's current
intent, estimates, expectations and projections and involve a number of risks
and uncertainties.  Various factors exist which may cause results to differ
from these expectations.  These risks and uncertainties include, but are not
limited to, the risk factors that are discussed from time to time in the
Company's SEC reports, including, but not limited to, the annual report on
Form 10-K for the fiscal year ended January 2, 2005.  In addition to the
potential effect of these ongoing factors, the Company's operations and
financial performance may be adversely effected if, among other factors, (i)
same-store revenues are less than projected; (ii) the availability of new
movie releases priced for sale negatively impacts the consumers' desire to
rent movies; (iii) the number of new store openings during the year is less
than expected; (v) unforeseen issues with the continued integration of the
Hollywood Entertainment business; (v) the Company's actual expenses or
liquidity requirements differ from estimates and expectations; (vi) consumer
demand for movies and games is less than expected; (vii) the availability of
movies and games is less than expected; (viii) competitive pressures are
greater than anticipated; (ix) the Company expands its investment in existing
strategic initiatives for alternative delivery of media content or chooses to
invest in significant new strategic initiatives or (x) the effects of
Hurricane Katrina and other hurricanes are greater than expected on the
Company's overall operations.  The Company undertakes no obligation to update
any forward-looking statements, whether as a result of new information,
future events, or otherwise.

Contacts

Financial: Thomas D. Johnson, Jr., Movie Gallery, Inc., +1-503-570-1950
Media: Andrew B. Siegel of Joele Frank, Wilkinson Brimmer Katcher, +1-212-
355-4449 ext. 127

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