8-K

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT
                       Pursuant to Section 13 or 15(d) of
                       The Securities Exchange Act of 1934

        Date of Report (Date of earliest event reported) August 16, 2005


                              Books-A-Million, Inc.
 ______________________________________________________________________________
             (Exact name of registrant as specified in its charter)


DELAWARE                          0-20664                          63-0798460
_______________________________________________________________________________
(State or other jurisdiction     (Commission                      (IRS Employer
 of incorporation)               File Number)               Identification No.)


402 Industrial Lane, Birmingham, Alabama                            35211
____________________________________________               _____________________
(Address of principal executive offices)                          (Zip Code)

        Registrant's telephone number, including area code (205) 942-3737


                                       N/A
________________________________________________________________________________
         (Former name or former address, if changed since last report.)

     Check the  appropriate  box below if the Form 8-K  filing  is  intended  to
simultaneously  satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):

     [ ] Written  communications  pursuant to Rule 425 under the  Securities Act
(17 CFR 230.425)

     [ ] Soliciting  material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)

     [ ]  Pre-commencement  communications  pursuant to Rule 14d-2(b)  under the
Exchange Act (17 CFR 240.14d-2(b))

     [ ]  Pre-commencement  communications  pursuant to Rule 13e-4(c)  under the
Exchange Act (17 CFR 240.13e-4(c))

                Section 1 - Registrant's Business and Operations


Item 1.01 Entry into a Material Definitive Agreement.



Adoption of Formula for Non-Employee Director Restricted Stock Awards

     On June 1, 2005, the stockholders of Books-A-Million,  Inc. (the "Company")
approved the Books-A-Million  2005 Incentive Award Plan (the "Plan").  The Board
of Directors of the Company (the "Board") previously adopted the Plan subject to
stockholder  approval.  Pursuant  to the terms of the 2005  Plan,  the Board may
award restricted shares ("Restricted  Stock") of the Corporation's common stock,
par value $0.01 per share ("Common Stock"), to non-employee members of the Board
("Outside  Directors")  pursuant  to such  terms  as the  Board  shall  deem
appropriate  consistent  with the terms of the 2005 Plan. A full  description of
the Plan,  including  a copy of the Plan,  was  previously  filed as part of the
Company's  Definitive  Proxy Statement for the Annual Meeting of Shareholders to
be held on June 1, 2005 and it is incorporated herein by reference.

     On  August  16,  2005,  the  Board  adopted  a  formula  pursuant  to which
Outside  Directors  shall be awarded  Restricted  Stock under the Plan.  The
formula  provides  that each  Outside  Director who is initially  elected or
appointed  to the Board on or after  August 16, 2005 shall,  effective as of the
date of such  initial  appointment  or election to the Board,  be awarded  3,333
shares of Restricted  Stock (an "Initial Award") pursuant to the 2005 Plan which
will be subject to the terms and conditions of a Restricted  Stock  Agreement in
substantially  the form attached hereto as Exhibit 10.1 (the  "Restricted  Stock
Agreement").  This Restricted  Stock Agreement shall provide among other things,
that the shares of  Restricted  Stock  subject to the Initial Award will vest in
three equal  installments on the first,  second and third  anniversaries  of the
effective date of the Initial Award.

     In addition,  the formula  provides that on each  December  31st  following
August 16, 2005, each Outside Director who as of December 31st has served on the
Board for at least eleven  continuous  months  shall be awarded  2,000 shares of
Restricted Stock (a "Continuing  Award") pursuant to the 2005 Plan which will be
subject to the terms and conditions of a Restricted Stock Agreement, which shall
provide  among other things,  that the shares of  Restricted  Stock subject to a
Continuing Award will vest in three equal installments on the first,  second and
third  anniversaries  of the  effective  date of such  Continuing  Award).  This
formula shall remain in effect until the expiration of the 2005 Plan unless such
formula is earlier  terminated or modified by subsequent  action of the Board in
accordance with the terms of the 2005 Plan.

Outside Director Stock Awards

     On August 16, 2005, the Board resolved to allow each  Outside  Director
to have the option to request to  receive  Stock  Awards  under the 2005 Plan in
lieu of annual cash retainer  fees that would  otherwise  become  payable to the
directors,  equal to that number of whole shares of Common Stock  determined  by
dividing the total cash fees by the fair market value of a share of Common Stock
as of the day the cash fees would  otherwise be paid,  with any fractions  being
paid in  cash.  The  Board  determined  that it was  advisable  and in the  best
interests of the Corporation to promote the long-term  growth of the Corporation
by  increasing  the  proprietary  interest  of  Outside   Directors  in  the
Corporation and to attract and retain highly  qualified and capable  Outside
Directors.

Approval of Stock Ownership and Retention Program

     On August 16, 2005, the Board approved Stock Ownership Guidelines providing
that each Outside  Director shall hold an equity interest in the Corporation not
less than 12,500 shares of Common Stock, with each Outside Director having up to
five years to achieve his or her ownership  goals.  The Board determined that it
was  advisable  and in  the  best  interests  of the  Corporation  that  Outside
Directors be required to hold such an equity interest in the Corporation.

Approval of Directors Deferred Compensation Plan

     On August 16, 2005, the Board approved the adoption of the Books-A-Million,
Inc.   Directors'   Deferred   Compensation   Plan  (the  "Directors'   Deferred
Compensation  Plan").  The  following  description  of  the  Directors  Deferred
Compensation  Plan is  intended  only to be a summary  and is  qualified  in its
entirety by Exhibit 10.2, which is incorporated herein by reference.

     The  Directors'   Deferred   Compensation  Plan  provides  the  Outside
Directors with the  opportunity to defer the receipt of certain  amounts payable
to an  Outside  Director for serving as a member of the Board (the  "Fees").
The obligations of the Company under the Directors'  Deferred  Compensation Plan
will  be  general   unsecured   obligations  of  the  Company  to  pay  deferred
compensation in the future to participating  Outside Directors in accordance
with the terms of the  Directors'  Deferred  Compensation  Plan from the general
assets of the Company.

     Each participating Outside Director may elect to defer under the Directors'
Deferred  Compensation  Plan a portion of his or her Fees that may  otherwise be
payable in a calendar year. An Outside  Director's Fee deferrals are credited to
the Outside Director 's bookkeeping account (the "Account") maintained under
the Directors'  Deferred  Compensation Plan.  Participants may elect to have the
amounts  credited  to  his or  her  Account  credited  with  interest  at a rate
determined  annually based on 10-year United States Treasury  Notes.  Subject to
certain restrictions,  each participating Outside Director may alternatively
elect to have the  amounts  in the  Account  deemed  invested  in  shares of the
Company's  Common  Stock.  The Company is not  obligated to actually  invest any
deferred amounts. Each participating Outside Director 's Account is credited
with a deemed rate of interest  and/or  earnings  or losses  depending  upon the
investment performance of the deemed investment option.

     With certain  exceptions,  a participating  Outside  Director's Account
will be paid after the earlier of: (1) a fixed  payment  date, as elected by the
participating   Outside   Director  (if  any);  or  (2)  the   participating
Outside  Director 's separation from service on the Board. The participating
Outside  Director may generally  elect that payments be made in a single sum
or installments in the year specified by the participating  Outside Director
or upon  the  Outside  Director's  separation  from  service  on the  Board.
Additionally,  a participating Outside Director may elect to receive payment
upon a Change of Control, as defined in, and to the extent permitted by, Section
409A of the Internal Revenue Code of 1986, as amended.

Approval of Executive Deferred Compensation Plan

     On August 16, 2005, the Board approved the adoption of the Books-A-Million,
Inc.   Executives'  Deferred   Compensation  Plan  (the  "Executives'   Deferred
Compensation  Plan").  The  following  description  of  the  Directors  Deferred
Compensation  Plan is  intended  only to be a summary  and is  qualified  in its
entirety by Exhibit 10.3, which is incorporated herein by reference.

     The  Executives'  Deferred  Compensation  Plan  provides a select  group of
management  or highly  compensated  employees  of  Company  and  certain  of its
subsidiaries  with  the  opportunity  to  defer  the  receipt  of  certain  cash
compensation.   The  obligations  of  Company  under  the  Executives'  Deferred
Compensation  Plan will be  general  unsecured  obligations  of  Company  to pay
deferred  compensation in the future to  participating  eligible  employees (the
"Participants")  in  accordance  with  the  terms  of the  Executives'  Deferred
Compensation Plan from the general assets of Company.

     Each  Participant  may  elect  to  defer  under  the  Executives'  Deferred
Compensation  Plan a portion of his or her cash  compensation that may otherwise
be  payable in a calendar  year.  A  Participant's  compensation  deferrals  are
credited to the  Participant's  bookkeeping  account (the "Account")  maintained
under the Executives' Deferred Compensation Plan. Participants may elect to have
the  amounts  credited to his or her Account  credited  with  interest at a rate
determined  annually based on 10-year United States Treasury  Notes.  Subject to
certain  restrictions,  each  Participant  may  alternatively  elect to have the
amounts in the Account deemed invested in shares of the Company's  Common Stock.
The Company is not  obligated to actually  invest any deferred  amounts in those
investment options. Each Participant's Account is credited with a deemed rate of
interest and/or earnings or losses depending upon the investment  performance of
the deemed investment option.

     With certain  exceptions,  a  Participant's  Account will be paid after the
earlier of: (1) a fixed payment date, as elected by the Participant (if any); or
(2) the Participant's  separation from service with Company or its subsidiaries.
Participants  may  generally  elect  that  payments  be made in a single  sum or
installments in the year specified by the  Participant or upon their  separation
from service with the Company.  Additionally, a Participant may elect to receive
payment upon a Change of Control, as defined in, and to the extent permitted by,
Section 409A of the Internal Revenue Code of 1986, as amended.

Bonus Payment Plan

     On August 16, 2005,  the  Committee  approved a bonus  program for the 2006
fiscal year (the "2006  Program")  in  connection  with the  preparation  of the
Company's  annual  operating  budget for the 2006 fiscal year.  The 2006 Program
provides   incentives   to  officers   of  the  Company  who  could   contribute
significantly  to increasing the Company's  revenue,  income and cash flow. Each
executive officer, including the Chief Executive Officer, is eligible to receive
an annual  cash bonus of up to 100% of his or her fiscal 2006 base  salary.  The
terms of the 2006  Program  are  outlined  in a standard  form letter (the "2006
Program  Letter")  which is  delivered to each  participant,  a copy of which is
attached hereto as Exhibit 10.4 and which is incorporated herein by reference.

     2006 Program Letter:  As detailed more fully in the 2006 Program Letter, an
executive officer (including the Chief Executive Officer) is eligible to receive
a bonus under the 2006 Program if the Company  achieves  certain  pre-tax income
goals and the executive  officer  accomplishes  certain  individual  performance
goals related to his or her job  functions.  The Committee  will approve  awards
under the 2006 Program,  as appropriate,  upon receipt of the audited  financial
statements for the fiscal year ending on January 28, 2006.



                  Section 9 - Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.


(c)      Exhibits.

Exhibit No.              Document Description
10.1                Form of Restricted Stock Agreement
10.2                Books-A-Million, Inc. Directors' Deferred Compensation Plan
10.3                Books-A-Million, Inc. Executives' Deferred Compensation Plan
10.4                Form of Letter Regarding the 2006 Bonus Program




                                   SIGNATURES


     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.

                                       _____________BOOKS-A-MILLION, INC._______
                                                        (Registrant)

Date _August 22, 2005______
                                __________/s/ Richard S. Wallington____________
                                                   (Signature)
                                        Name:  Richard S. Wallington
                                        Title:   Chief Financial Officer

EX-10

Exhibit 10.1
                              Books-A-Million, Inc.

                 Outside Director Restricted Stock Agreement

     THIS  AGREEMENT,  dated  ____________,  200__ (the "Award  Date"),  is made
between Books-A-Million, Inc., a Delaware corporation hereinafter referred to as
the  "Company,"  and  ______________,  an  Outside  Director of the Company,
hereinafter referred to as the "Participant."

     1.  Definitions.  All  capitalized  terms  used in this  Agreement  without
definition  shall have the meanings  ascribed in the  Company's  2005  Incentive
Award Plan, as amended from time to time (the "Plan").

     2. Award of Restricted Stock.


     (a) Award.  In  consideration  of the  Participant's  agreement  to provide
services to the Company as an Outside Director,  and for other good and valuable
consideration  which the  Compensation  Committee  has  determined  exceeds  the
aggregate  par  value of the  shares of the  common  stock of the  Company  (the
"Common Stock")  subject to the Award (as defined below),  as of the Award Date,
the Company issues to the Participant the Award described in this Agreement (the
"Award"). The number of shares of Restricted Stock (the "Shares") subject to the
Award (which shall be subject to adjustment in accordance with Section 11 of the
Plan) is set forth on the signature page hereof.


     (b) Purchase  Price;  Book Entry Form.  The purchase price of the Shares is
zero  dollars  ($0.00) per share.  The Shares  will be issued in  uncertificated
form.  The Shares will be recorded in the name of the  Participant  in the books
and records of the Company's  transfer agent.  Upon vesting and the satisfaction
of  all   conditions  set  forth  in  Section  3(d),  the  Company  shall  cause
certificates representing the Shares to be issued to the Participant.


     (c)  Plan.  The  Award  granted  hereunder  is  subject  to the  terms  and
provisions of the Plan, including without limitation, Article 11 thereof.

     3. Restrictions.

     (a)  Forfeiture.  Any  Award  which is not  vested  upon the  Participant's
termination of employment  shall thereupon be forfeited  immediately and without
any  further   action  by  the  Company.   For   purposes  of  this   Agreement,
"Restrictions"  shall mean the  restrictions on sale or other transfer set forth
in Section 4 and the exposure to forfeiture set forth in this Section 3(a).


     (b) Vesting and Lapse of  Restrictions.  Subject to Sections 3(a) and 3(c),
the Award shall vest and  Restrictions  shall  lapse with  respect to 1/3 of the
Shares subject to the Award (rounded down to the next whole number of shares) on
each of the first three  anniversaries of the Award Date,  provided in each case
that the  Participant  remains  continuously in the service of the Company as an
Outside Director from the Award Date through such date.


     (c)  Acceleration of Vesting.  Notwithstanding  Sections 3(a) and 3(b): (i)
the Award shall  become  fully vested and all  Restrictions  applicable  to such
award shall lapse in the event of a termination  of employment  resulting from a
Participant's  disability or death;  and (ii) the Award may, in the  Committee's
sole and absolute  discretion,  become vested and all Restrictions on such award
shall lapse in accordance  with Section 11.2 of the Plan. In connection with the
foregoing,  the Committee may make such  determinations and adopt such rules and
conditions as it, in its sole discretion,  deems  appropriate in connection with
such  acceleration of vesting and lapse of applicable  Restrictions,  including,
but not limited to,  provisions to ensure that any such  acceleration of vesting
and lapse of  Restrictions  shall be conditioned  upon the  consummation  of any
corporate transaction described in Sections 11.1 and 11.2 of the Plan.


     (d) Tax Withholding; Conditions to Issuance of Certificates.


     (i)  Notwithstanding  Section  2(b),  no  such  new  certificate  shall  be
delivered to the  Participant or his legal  representative  unless and until the
Participant or his legal  representative shall have paid to the Company the full
amount of all federal and state  withholding  or other taxes  applicable  to the
taxable  income of Participant  resulting from the grant of Restricted  Stock or
the lapse or removal of the Restrictions.


     (ii)  Notwithstanding  Section  2(b),  the Company shall not be required to
issue or deliver any  certificate  or  certificates  for any Shares prior to the
fulfillment of all of the following conditions:  (A) the admission of the Shares
to listing on all stock exchanges on which such Common Stock is then listed, (B)
the completion of any  registration or other  qualification  of the Shares under
any state or federal  law or under  rulings or  regulations  of the SEC or other
governmental  regulatory  body,  which  the  Committee  shall,  in its  sole and
absolute  discretion,  deem  necessary and  advisable,  (C) the obtaining of any
approval or other clearance from any state or federal  governmental  agency that
the Committee  shall, in its absolute  discretion,  determine to be necessary or
advisable and (D) the lapse of any such reasonable  period of time following the
date the Restrictions lapse as the Committee may from time to time establish for
reasons of administrative convenience.


     (e) Section 83(b) Election.  Participant  understands that Section 83(a) of
the Code taxes as ordinary  income the  difference  between the amount,  if any,
paid for the shares of Common  Stock and the Fair Market Value of such shares at
the time the Restrictions on such shares lapse.  Participant  understands  that,
notwithstanding the preceding sentence, Participant may elect to be taxed at the
time of the Award  Date,  rather  that at the time the  Restrictions  lapse,  by
filing an election  under Section 83(b) of the Code (an "83(b)  Election")  with
the  Internal  Revenue  Service  within 30 days of the Award Date.  In the event
Participant files an 83(b) Election,  Participant will recognize ordinary income
in an amount equal to the  difference  between the amount,  if any, paid for the
shares of Common  Stock and the Fair Market Value of such shares as of the Award
Date.  Participant  further  understands  that an additional  copy of such 83(b)
Election form should be filed with his or her federal  income tax return for the
calendar  year  in  which  the  date  of  this  Agreement   falls.   Participant
acknowledges that the foregoing is only a summary of the effect of United States
federal income taxation with respect to the award of Restricted Stock hereunder,
and does not purport to be complete.  PARTICIPANT FURTHER  ACKNOWLEDGES THAT THE
COMPANY IS NOT RESPONSIBLE FOR FILING THE PARTICIPANT'S 83(b) ELECTION,  AND THE
COMPANY HAS  DIRECTED  PARTICIPANT  TO SEEK  INDEPENDENT  ADVICE  REGARDING  THE
APPLICABLE  PROVISIONS  OF THE CODE,  THE INCOME  TAX LAWS OF ANY  MUNICIPALITY,
STATE  OR  FOREIGN  COUNTRY  IN  WHICH  PARTICIPANT  MAY  RESIDE,  AND  THE  TAX
CONSEQUENCES OF PARTICIPANT'S DEATH.


     4. Restricted Stock Not  Transferable.  No Restricted Stock or any interest
or right  therein or part  thereof  shall be liable for the debts,  contracts or
engagements of the Participant or his successors in interest or shall be subject
to  disposition  by transfer,  alienation,  anticipation,  pledge,  encumbrance,
assignment  or  any  other  means  whether  such  disposition  be  voluntary  or
involuntary or by operation of law by judgment, levy, attachment, garnishment or
any  other  legal  or  equitable  proceedings  (including  bankruptcy),  and any
attempted disposition thereof shall be null and void and of no effect; provided,
however,  that  this  Section  4  shall  not  prevent  transfers  by  will or by
applicable laws of descent and distribution.


     5. Rights as Stockholder.  Except as otherwise  provided  herein,  upon the
Award  Date the  Participant  shall have all the  rights of a  stockholder  with
respect to said shares, subject to the Restrictions herein,  including the right
to vote the shares and to receive all dividends or other  distributions  paid or
made with respect to the shares of Restricted Stock; provided,  however, that at
the discretion of the Company, and prior to the delivery of shares of Restricted
Stock,  the Participant  may be required to execute a stockholders  agreement in
such form as shall be determined by the Company.


     6. Not a Contract of  Employment.  Nothing in this Agreement or in the Plan
shall  confer  upon the  Participant  any right to continue in the employ of the
Company or any of its  Subsidiaries  or shall  interfere with or restrict in any
way the rights of the Company or its  Subsidiaries,  which are hereby  expressly
reserved,  to discharge the  Participant at any time for any reason  whatsoever,
with or without  cause,  except as may  otherwise  be  provided  by any  written
agreement entered into by and between the Company and the Participant.


     7.  Governing  Law.  The laws of the State of  Delaware  shall  govern  the
interpretation,  validity,  administration,  enforcement  and performance of the
terms of this  Agreement  regardless  of the law that  might  be  applied  under
principles of conflicts of laws.


     8.  Conformity to Securities  Laws. The Participant  acknowledges  that the
Plan and this Agreement are intended to conform to the extent necessary with all
provisions  of the  Securities  Act of  1933,  as  amended,  and the  Securities
Exchange  Act of  1934,  as  amended  (the  "Exchange  Act"),  and  any  and all
regulations  and rules  promulgated  thereunder by the  Securities  and Exchange
Commission,  including  without  limitation  Rule 16b-3 under the Exchange  Act.
Notwithstanding anything herein to the contrary, the Plan shall be administered,
and the  Awards are  granted,  only in such a manner as to conform to such laws,
rules and  regulations.  To the extent permitted by applicable law, the Plan and
this  Agreement  shall be deemed  amended to the extent  necessary to conform to
such laws, rules and regulations.


     9.  Amendment,  Suspension  and  Termination.  The  Awards may be wholly or
partially amended or otherwise modified,  suspended or terminated at any time or
from time to time by the Committee or the Board,  provided,  that, except as may
otherwise  be  provided  by the Plan,  neither  the  amendment,  suspension  nor
termination of this  Agreement  shall,  without the consent of the  Participant,
alter or impair any rights or obligations under any Award.


     10.  Notices.  Notices  required or permitted  hereunder  shall be given in
writing and shall be deemed  effectively  given upon  personal  delivery or upon
deposit in the United  States  mail by  certified  mail,  with  postage and fees
prepaid,  addressed  to the  Participant  to his  address  shown in the  Company
records, and to the Company at its principal executive office.





                                    * * * * *


     The Participant represents that he has read this Agreement and the Plan and
is familiar with the terms and provisions of each. The Participant  acknowledges
that the Award is issued pursuant to, and is subject to the terms and conditions
of, the Plan, and the  Participant  will be bound by the terms of the Plan as if
it were set forth verbatim in this Agreement.  The Participant  agrees to comply
with all  rules  the  Company  may  establish  with  respect  to the  Plan.  The
Participant  agrees to accept as binding,  conclusive and final all decisions or
interpretations of the Committee with respect to any questions arising under the
Plan or this Agreement.  The Participant  further  acknowledges  and agrees that
this  Agreement  (and the Plan)  constitutes  the entire  agreement  between the
parties  with  respect  to the  Award  and that  this  Agreement  (and the Plan)
supersedes any and all prior  agreements,  whether written or oral,  between the
parties with respect to the Award.

     IN WITNESS  WHEREOF,  this Agreement has been executed and delivered by the
parties hereto as of the date first set forth above.

         BOOKS-A-MILLION, INC.                           PARTICIPANT


         By: ___________________________                 _____________________
         Name:
         Title:
                                                         Residence Address:
                                                         STREET1
                                                         STREET2
                                                         CITY, STATE ZIP
                                                         COUNTRY

                          Aggregate number of shares of
                         Restricted Stock subject to the
                                Award: __________

EX-10

BOOKS-A-MILLION, INC.
DIRECTORS' DEFERRED COMPENSATION PLAN
Effective as of September 1, 2005

     The Books-A-Million,  Inc. Directors' Deferred Compensation Plan (as it may
be amended from time to time,  the "Plan") has been adopted by  Books-A-Million,
Inc.,  a  corporation  organized  under the laws of the state of  Delaware  (the
"Company"),  effective as of September 1, 2005 (the "Effective  Date"),  for the
benefit of its eligible non-employee directors.

ARTICLE I.

DEFINITIONS

     Section 1.1 "Account"  shall mean the  bookkeeping  account  created by the
Company pursuant to Article III of this Plan in accordance with an election by a
Director to receive deferred compensation under Article II hereof.

     Section 1.2 "Board" shall mean the Board of Directors of the Company.

     Section 1.3 "Change in Control"  shall mean any change in the  ownership or
effective control of the Company,  or in the ownership of a substantial  portion
of the assets of the Company,  as described in Section  409A(a)(2)(A)(v)  of the
Code or any other  "Change in  Control  Event" as  defined  in  accordance  with
Department of Treasury guidance  promulgated pursuant to Section 409A, including
without limitation Notice 2005-1 and such other interpretive  guidance as may be
issued after the Effective Date.

     Section  1.4  "Code"  shall  mean the  Internal  Revenue  Code of 1986,  as
amended.

     Section 1.5 "Common Stock" shall mean the common stock of the Company,  par
value $0.01 per share.

     Section 1.6  "Company"  shall have the  meaning  set forth in the  recitals
hereto.

     Section 1.7  "Deferral  Election  Form" shall have the meaning set forth in
Section 2.3.

     Section 1.8 "Deferred Cash Account"  shall mean the Account  created by the
Company pursuant to Article III of this Plan in accordance with an election by a
Director to treat a portion of Deferred Fees as invested in an interest  bearing
account pursuant to Article II hereof.

     Section  1.9  "Deferred  Fees"  shall have the meaning set forth in Section
3.1.

     Section 1.10 "Deferred  Stock Unit Account" shall mean the Account  created
by the  Company  pursuant  to  Article  III of this Plan in  accordance  with an
election by a Director to treat a portion of Deferred Fees as invested in Common
Stock pursuant to Article II hereof.

     Section  1.11  "Deferred  Stock Unit" shall mean the right of a Director to
receive  one  share of  Common  Stock  upon a  distribution  of his  Account  in
accordance with Article IV.

     Section  1.12  "Director"  shall  mean a member  of the Board who is not an
employee of the Company or any of its subsidiaries.

     Section 1.13 A Director  shall be shall be  "Disabled" if such Director (a)
is  unable  to  engage  in any  substantial  gainful  activity  by reason of any
medically  determinable  physical or mental  impairment which can be expected to
result in death or can be expected to last for a  continuous  period of not less
than 12 months, or (b) is, by reason of any medically  determinable  physical or
mental impairment which can be expected to result in death or can be expected to
last for a  continuous  period  of not less  than 12  months,  receiving  income
replacement  benefits  for a period of not less than 3 months  under an accident
and health plan covering employees of the Company. The Board shall have full and
final  authority,  which shall be  exercised  in its  discretion,  to  determine
conclusively  whether a Director is Disabled,  and shall make such determination
consistent with Section 409A.

     Section  1.14  "Dividend  Equivalent"  shall have the  meaning set forth in
Section 3.2(b).

     Section  1.15  "Effective  Date"  shall have the  meaning  set forth in the
recitals hereto.

     Section 1.16 "Fair Market Value" means, as of any given date, (a) if Common
Stock is traded on an exchange,  the closing price of a share of Common Stock as
reported in the Wall Street Journal for the first trading date immediately prior
to such date during which a sale occurred;  or (b) if Common Stock is not traded
on an exchange but is quoted on NASDAQ or a successor or other quotation system,
(i) the last sales price (if Common  Stock is then  listed as a National  Market
Issue  under the NASD  National  Market  System)  or (ii) the mean  between  the
closing  representative bid and asked prices (in all other cases) for the Common
Stock on the date  immediately  prior to such date on which sales  prices or bid
and asked  prices,  as  applicable,  are  reported  by NASDAQ or such  successor
quotation system; or (c) if Common Stock is not publicly traded, the fair market
value established by the Board acting in good faith.

     Section 1.17 "Fees" shall mean amounts payable to a Director for serving as
a member of the  Board,  including  without  limitation  any (a) annual or other
periodic retainer payments;  (b) fees payable for meeting  attendance;  (c) fees
payable for  committee  membership;  and (d) fees payable for Board or committee
chairmanship.

     Section 1.18 "Fund" shall have the meaning set forth in Section 3.5.

     Section 1.19 "Interest" shall mean simple interest credited to a Director's
Deferred  Cash Account as of each  Interest  Credit  Date.  The rate of Interest
shall be equal to the interest rate on 10-year  United States  Treasury Notes as
of the applicable Interest Credit Date.

     Section 1.20 "Interest  Credit Date" shall mean the date next following the
end of each  calendar  year  which is  determined  by the  Board and as of which
Interest is credited to each Director's Account.

     Section  1.21  "Plan"  shall  have the  meaning  set forth in the  recitals
hereto.

     Section 1.22 "Plan Year" shall mean calendar year.

     Section  1.23  "Section  409A"  shall  mean  Section  409A of the  Code and
Department  of  Treasury  regulations  and other  interpretive  guidance  issued
thereunder,  including  without  limitation Notice 2005-1 and any regulations or
other interpretive guidance as may be issued after the Effective Date.

     Section  1.24  "Separation  from  Service"  of a Director  means his or her
"separation  from service,"  with respect to the Company,  within the meaning of
Section  409A(a)(2)(A)(i)  of the Code,  as  determined  by the Secretary of the
Treasury.  The  Board  shall  have  full and  final  authority,  which  shall be
exercised in its discretion,  to determine  conclusively  whether a Director has
had a "Separation from Service," and the date of such "Separation from Service."

     Section 1.25 A Director shall be a "Specified Employee" if such Director is
a key  employee  (as  defined in Section  416(i) of the Code  without  regard to
paragraph  (5)  thereof)  of the  Company  and the Company has any stock that is
publicly traded on an established securities market or otherwise,  as determined
in  accordance  with  Section  409A  (including   without   limitation   Section
409A(a)(2)(B)(i) of the Code).

     Section  1.26  "Unforeseeable  Emergency"  shall  mean a  severe  financial
hardship to the Director  resulting from an illness or accident of the Director,
the Director's spouse, or a dependent (as defined in Section 152(a) of the Code)
of the  Director,  loss of the  Director's  property due to  casualty,  or other
similar  extraordinary  and unforeseeable  circumstances  arising as a result of
events beyond the control of the  Director.  The Board shall have full and final
authority, which shall be exercised in its discretion, to determine conclusively
whether a Director has experienced an "Unforeseeable  Emergency," and shall make
such determination consistent with Section 409A.

ARTICLE II.

ELECTION TO DEFER

     Section 2.1 Initial Elections.  A Director may elect, on or before December
31 of any Plan Year,  to defer  payment of all or a  specified  part of all Fees
earned  during the Plan Year  following  such  election  (and, to the extent set
forth in Section 2.2, in any succeeding  Plan Years until the Director ceases to
be a  Director);  provided,  however,  that  with  respect  to Plan  Year 2005 a
Director may elect,  within thirty (30) days after the Effective  Date, to defer
all or a specified  part of all Fees payable  with respect to services  rendered
after the date of the Director's initial election. Any person who shall become a
Director  during any Plan Year, and who was not a Director of the Company on the
preceding  December  31, may elect,  no later  than  thirty  (30) days after the
Director's term begins, to defer payment of all or a specified part of such Fees
payable with respect to services rendered during the remainder of such Plan Year
(and,  to the extent set forth in Section  2.2,  for any  succeeding  Plan Years
until the Director ceases to be a Director).  Any Fees deferred pursuant to this
Paragraph  shall  be paid  to the  Director  at the  time(s)  and in the  manner
specified in Article IV hereof, as designated by the Director.

     Section 2.2 Subsequent Elections. With respect to Plan Years following Plan
Year 2005, if a Director fails to submit a Deferral Election Form by December 31
of the Plan Year immediately prior to such Plan Year, the amount of the deferral
election  for such Plan Year  shall be zero;  provided,  however,  that,  to the
extent permitted by Section 409A, a Deferral Election Form may provide that that
the  election  shall  continue  from Plan Year to Plan Year unless the  Director
terminates it by written request  delivered to the Company's  Secretary prior to
the commencement of the Plan Year for which the termination is first effective.

     Section 2.3 Deferral  Election  Form.  The election to  participate  in the
Plan,  manner  of  payment  and  investment  election  shall  be  designated  by
submitting a deferral election form in substantially the form attached hereto as
Exhibit A (as it may be revised from time to time, the "Deferral Election Form")
to the Company's Secretary.

     Section  2.4  Limitations  on  Re-Deferrals.  In the event  that a Deferral
Election  Form permits,  under a subsequent  election by the Director to delay a
distribution,  or to change the form of distribution,  such subsequent  election
shall satisfy the  requirements  of Section 409A (including  without  limitation
Section 409A(a)(4)(C) of the Code), and:

     (a) Such subsequent election may not take effect until at least twelve (12)
months after the date on which the election is made;

     (b) In the case such  subsequent  election  relates  to a  distribution  or
payment not  described in Section  4.1(b),  (c) or (f),  the first  payment with
respect to such  election may be deferred for a period of not less than five (5)
years from the date such distribution or payment otherwise would have been made;
and

     (c) In the case such  subsequent  election  relates  to a  distribution  or
payment  described in Section  4.1(d),  such  election may not be made less than
twelve  (12) months  prior to the date of the first  scheduled  distribution  or
payment under Section 4.1(d).

ARTICLE III.

DEFERRED COMPENSATION ACCOUNTS

     Section 3.1  Bookkeeping  Accounts.  The Company  shall  maintain  separate
bookkeeping  accounts  for the Fees  deferred by each  Director  (the  "Deferred
Fees").

     Section 3.2 Deferred Stock Unit Account.

     (a) As of the date that any Deferred Fees would otherwise have been payable
to a Director,  the Company  shall credit such  Director's  Deferred  Stock Unit
Account  with that number of Deferred  Stock Units equal to the ratio of (i) the
aggregate  value of the designated  portion of Deferred Fees the Director elects
to be deemed  invested in Common Stock,  to (ii) the Fair Market Value per share
of Common Stock as of such date.

     (b) As of the date the  Company  pays any  dividend  (whether in cash or in
kind) on shares of Common Stock,  each  Director's  Deferred  Stock Unit Account
shall be  credited  with that  number of  Deferred  Stock  Units (the  "Dividend
Equivalents") equal to the ratio of (i) the aggregate value of the dividend that
would  have been  payable  on the  Deferred  Stock  Units  held by the  Director
immediately  prior  to  such  payment  date  had  the  shares  of  Common  Stock
represented  by such Deferred  Stock Units been  outstanding  as of such payment
date to (ii) the Fair Market Value per share of Common Stock as of such date.

     Section 3.3 Deferred Cash Account

     (a) As of the date that any Deferred Fees would otherwise have been payable
to a Director,  the Company  shall credit the  Director's  Deferred Cash Account
with the  aggregate  value of the  designated  portion of Deferred Fees that the
Director elects to be deemed to be invested in such Deferred Cash Account.

     (b) As of each  Interest  Credit  Date,  the  balance  of  each  Director's
Deferred Cash Account shall be credited with Interest.

     Section 3.4 Transfer Between Accounts. A Director may elect to have amounts
transferred  between his or her Deferred  Cash  Account and Deferred  Stock Unit
Account  as of any  Interest  Credit  Date  using  such  forms as the  Board may
designate  from time to time.  Such transfer shall be made using the Fair Market
Value of a share of Common Stock on such  transfer  date to determine the amount
to be credited and debited from the applicable Accounts.

     Section 3.5 Unsecured General Creditor;  Fund. Deferred Fees and any deemed
earnings with respect thereto shall be held in the general assets of the Company
and no separate fund or trust shall be created or moneys set aside on account of
the  Account.  To the  extent  that  any  person  acquires  a right  to  receive
distributions  from the Company  under the Plan,  such right shall be no greater
than the right of any unsecured general creditor of the Company. Notwithstanding
the foregoing, the Board, in its discretion,  may elect to establish a fund (the
"Fund") containing assets equal to the amounts credited to Directors'  Accounts,
and may elect in its  discretion  to  designate  a  trustee  to hold the Fund in
trust;  provided,  however,  that such Fund shall remain a general  asset of the
Company  subject to the rights of  creditors  of the Company in the event of the
Company's bankruptcy or insolvency as defined in any such trust.

ARTICLE IV.

PAYMENT OF DEFERRED COMPENSATION

     Section 4.1 Distributions.  Subject to Sections 4.1(a)-(f) and 4.2, amounts
contained  in a  Director's  Account  shall  be  distributed  as the  Director's
election  (made  pursuant to Section  2.3) shall  provide.  Notwithstanding  the
foregoing, all amounts contained in a Director's account shall be distributed in
accordance with the requirements of Section 409A (including  without  limitation
Section 409A(a)(2) of the Code), and shall not be distributed earlier than:

     (a) The date of the Director's Separation from Service;

     (b) The date the Director becomes Disabled;

     (c) The date of the Director's death;

     (d) A specified time (or pursuant to a fixed schedule)  specified under the
Deferral Election Form at the date of the deferral compensation;

     (e) To the extent  provided by the Secretary of the  Treasury,  a Change in
Control; or

     (f) The  occurrence  of an  unforeseeable  emergency  with  respect  to the
Director.  The  requirement  of this  Section  4.1(f)  shall be met only if,  as
determined under Treasury  Regulations  under Section  409A(a)(2)(B)(ii)  of the
Code, the amounts distributed with respect to the unforeseeable emergency do not
exceed the  amounts  necessary  to satisfy  such  unforeseeable  emergency  plus
amounts  necessary  to pay  taxes  reasonably  anticipated  as a  result  of the
distribution,  after taking into account the extent to which such  unforeseeable
emergency  is or  may be  relieved  through  reimbursement  or  compensation  by
insurance or otherwise or by liquidation of the Director's assets (to the extent
the  liquidation  of  such  assets  would  not  itself  cause  severe  financial
hardship).

     Section 4.2  Specified  Employee.  If at the time any  distributions  would
otherwise  be made to a Director  pursuant to Section  4.1(a) the  Director is a
Specified Employee, the requirement of paragraph 4.1(a) shall be met only if the
distributions  may not be made  before the date  which is six  months  after the
Director's  Separation from Service (or, if earlier,  the date of the Director's
death).

     Section 4.3 Form of Distribution.  All distributions from the Plan shall be
made as follows:  (a) amounts deferred in the Deferred Stock Unit Accounts shall
be  distributed  in the form of whole  shares of Common  Stock  with  fractional
shares paid in cash;  and (b) amounts  deferred in the  Deferred  Cash  Accounts
shall be distributed in cash.

     Section 4.4 Payment of Interest. At the time of each installment payment or
lump sum payment made pursuant to Section 4.1, Interest which has been deemed to
have accrued since the previous  Interest Credit Date shall be paid with respect
to each applicable Director's Deferred Cash Account. The amount of such payments
shall be calculated using the methodology set forth in Section 3.3.

     Section 4.5 No  Acceleration.  The time or schedule of any  distribution of
any  shares  of  Common  Stock  shall not be  accelerated,  except as  otherwise
permitted under Section 409A (including without limitation Section 409A(a)(3) of
the Code).

     Section 4.6 Beneficiary Designation.  Each Director shall have the right to
designate  a  beneficiary  who is to  succeed  to his or her  right  to  receive
payments hereunder in the event of death. Except as may otherwise be provided in
any Deferral Election Form, in the event of the Director's death, the balance of
the amounts  contained in the  Director's  Account  shall be paid, in accordance
with Section 4.1, to the Director's or former  Director's  beneficiary (or if no
beneficiary has been designated,  to his estate) in full on the first day of the
Plan Year  following  the Plan Year in which he or she dies. No  designation  of
beneficiary  or change in  beneficiary  shall be valid  unless it is in  writing
signed by the Director and filed with the Company's Secretary.

ARTICLE V.

ADMINISTRATION; AMENDMENT

     Section 5.1  Administration.  The Plan shall be  administered by the Board.
The Board may  delegate  certain  administrative  authority  to a  committee  or
subcommittee of the Board or to one or more employees of the Company,  but shall
retain the ultimate responsibility for the interpretation of, and amendments to,
the Plan.  Members of the Board shall not be liable for any of their  actions or
determinations  made in good faith with  respect  to the  administration  of the
Plan. Except to the extent superseded by the laws of the United States, the laws
of the State of Delaware,  without  regard to its  conflict of laws  principles,
shall govern in all matters  relating to the Plan. All expenses  related to plan
administration  shall be paid by the Company.  All  decisions  made by the Board
with respect to issues hereunder shall be final and binding on all parties.

     Section 5.2 Change in  Capitalization  of the Company.  In the event of any
stock  dividend,  stock  split,  combination  or  exchange  of  shares,  merger,
consolidation, spin-off, recapitalization or any other corporate event affecting
the Common Stock or the share price of the Common  Stock,  the Board may, in its
sole discretion,  make such equitable  adjustments,  if any, with respect to the
Directors'  Accounts  (including,  without  limitation,  adjusting the number of
Deferred Stock Units credited thereto and/or the kind of securities  represented
thereby),  as the Board may deem necessary or appropriate to prevent dilution or
enlargement of the benefits or potential  benefits intended to be made available
under this Plan and to reflect such changes.

     Section 5.3  Nonassignability.  Except to the extent  required by law,  the
right of any  Director  or any  beneficiary  to any  benefit  or to any  payment
hereunder  shall not be  subject  in any  manner to  attachment  or other  legal
process for the debts of such Director or  beneficiary,  and any such benefit or
payment  shall not be subject  to  alienation,  sale,  transfer,  assignment  or
encumbrance.

     Section 5.4 Amendment. The Plan may be amended,  suspended or terminated in
whole or in part from time to time by the Board except that, except as set forth
in Section 5.5, no  amendment,  suspension,  or  termination  shall apply to the
payment to any  Director or  beneficiary  of a deceased  Director of any amounts
previously credited to a Director's Account.

     Section 5.5 Section  409A.  The Plan and  Deferral  Election  Form shall be
interpreted  in accordance  with,  and shall comply in form and operation  with,
Section 409A.  Notwithstanding  any  provision of the Plan to the contrary,  the
Board may adopt such amendments to the Plan and the applicable Deferral Election
Form or adopt other policies and procedures (including amendments,  policies and
procedures with retroactive  effect), or take any other actions,  that the Board
determines  are necessary or appropriate to (a) exempt the deferral from Section
409A of the Code and/or  preserve  the  intended  tax  treatment of the benefits
provided with respect to the deferral,  or (b) comply with the  requirements  of
Section 409A (including  without  limitation any related  Department of Treasury
guidance).




                                   * * * * *

     I hereby  certify  that the Plan was adopted by the Board of  Directors  of
Books-A-Million, Inc. on August 16, 2005, effective as of September 1, 2005.

                                    ___________________________________

                                    Sandra B. Cochran

                                    President and CEO



Books-A-Million, Inc.
Directors' Deferred Compensation Plan
DEFERRAL ELECTION FORM

     SEND COMPLETED FORM TO: Richard S. Wallington;  Chief Financial  Officer of
Books-A-Million,  Inc.; 402 Industrial Lane, P.O. Box 19768, Birmingham, Alabama
35219; Fax: (205) 945-1772.

         Initial Enrollment (complete Sections 1, 2, 3 & 4)

         Change Beneficiary (complete Sections 3 & 4)
________________________________________________________________________________
________________________________________________________________________________
Social Security Number            Last Name             First Name           MI
________________________________________________________________________________
Mailing Address      City      State        Zip Code           Daytime Telephone
________________________________________________________________________________

     Section 409A: I understand that  notwithstanding any other provision of the
Books-A-Million,  Inc.  Directors'  Deferred  Compensation  Plan  (as  it may be
amended from time to time, the "Plan") or this Deferral  Election Form, the Plan
and this Deferral  Election Form shall be  interpreted  in accordance  with, and
incorporate  the terms and  conditions  required  by,  Section  409A of the U.S.
Internal  Revenue Code of 1986,  as amended  (together  with any  Department  of
Treasury   regulations  and  other  interpretive   guidance  issued  thereunder,
including without  limitation any such regulations or other guidance that may be
issued after the date hereof,  "Section  409A").  I further  understand that the
Board (as defined in the Plan) may, in its discretion,  adopt such amendments to
the Plan and this Deferral  Election Form or adopt other policies and procedures
(including amendments, policies and procedures with retroactive effect), or take
any other  actions,  as the Board  determines  are necessary or  appropriate  to
comply with the  requirements  of Section 409A.  Finally,  I understand that the
time or schedule of distributions that I elect pursuant to Section 2, below, may
not be accelerated except as otherwise permitted by Section 409A.

________________________________________________________________________________
SECTION 1 - DEFERRAL ELECTION

     Pursuant to the Plan, I hereby  elect to defer  receipt of all or a portion
of the Fees (as defined in the Plan) that would  otherwise  become payable to me
after  September 1, 2005 with respect to the 2005  calendar  year in  accordance
with the percentages indicated below (whole number percentages only):

_______% of the aggregate
Fees shall be credited to my Deferred Stock Unit Account as defined in the Plan;

_______% of the aggregate
 Fees shall be credited to my Deferred Cash Account as defined in the Plan;

     _______% of the aggregate Fees shall not be deferred,  but shall be paid to
me directly as they become payable.  I understand that this election will remain
in effect only with  respect to the deferral of my Fees earned  during  calendar
year 2005.  I further  understand  that Fee  deferrals  will be  credited  to my
Account  under  the Plan and that my  rights  to my  Account  are  unfunded  and
unsecured and are no greater than the rights of an unsecured general creditor of
the Company.

________________________________________________________________________________

SECTION 2 - ACCOUNT DISTRIBUTION

     A.  Commencement of  Distribution  Except as otherwise set forth in Section
2C,  below,  I elect to  commence  receiving  distributions  from my  Account in
accordance  with the following  election (check one): As of the first day of the
first  calendar  quarter  following  the  calendar  quarter in which I resign or
otherwise  experience a Separation  from Service (as defined in the Plan); or As
of the earlier of (1) January 1 of the __________  (insert number) calendar year
after the  deferral  is made (not less than 3 nor more than 10) or (2) as of the
first day of the first calendar quarter  following the calendar quarter in which
I resign or otherwise experience a Separation from Service.

     B. Form of Distribution Except as otherwise set forth in Section 2C, below,
I elect  to  receive  distributions  from my  Account  in  accordance  with  the
following  election  (check one): In one lump sum; or In _______ (insert number)
equal annual  installments (not less than 2 nor more than 10). I understand that
the  first  distribution  from my  Account  shall  be  payable  as of the date I
selected in Section 3A, above, and that if I elect annual installment payments I
will receive an installment as of each January 1 immediately following the first
distribution until my Account has been distributed in full.  Notwithstanding the
foregoing,  I understand  that if I am determined by the  Administrator  to be a
Specified  Employee (as defined in the Plan) at the time any distribution  would
otherwise  be made  pursuant to this  Section 2A, then no such  distribution  or
payment  shall be made or commence  until six months  after my  Separation  from
Service.

     C. Change in Control  Notwithstanding  any other provision of this Deferral
Election Form to the contrary,  to the extent  permitted by the Secretary of the
Treasury pursuant to Section 409A, I elect to have my Account  automatically and
fully distributed to me, in one lump sum immediately following the occurrence of
a Change in Control (as defined in the Plan).

________________________________________________________________________________

SECTION 3 - BENEFICIARY DESIGNATION

     If you die before you  receive  full  payment of your  Account,  the amount
remaining  in  your  Account  will be  paid  in a lump  sum to your  Beneficiary
designated in this Section 3:

________________________________________________________________________________
Social Security Number          Last Name              First Name            MI
_______________________________________________________________________________
Mailing Address           City          State       Zip Code           Telephone
_______________________________________________________________________________

SECTION 4 - AUTHORIZATION

     I agree that my  successors  in  interest  and my assigns  and all  persons
claiming under me shall, to the extent  consistent with applicable law, be bound
by the statements contained herein and by the provisions of the Plan as they now
exist and as they may be amended from time to time.  I have read and  understand
this form and hereby authorize the  Administrator to take all actions  indicated
on this form.

________________________________________________________________________________

Director's Signature                                                    Date

________________________________________________________________________________

This section for Company use only.

Date approved:______________________________________  By:_______________________

EX-10

BOOKS-A-MILLION, INC.
EXECUTIVES DEFERRED COMPENSATION PLAN
Effective as of September 1, 2005

     The Books-A-Million,  Inc. Executives Deferred Compensation Plan (as it may
be amended  from time to time,  the Plan) has been  adopted by  Books-A-Million,
Inc.,  a  corporation  organized  under the laws of the state of  Delaware  (the
Company),  effective  as of  September  1, 2005 (the  Effective  Date),  for the
benefit of certain of its employees.

     The Plan is a nonqualified deferred compensation plan pursuant to which the
Company (as  hereinafter  defined) and its affiliates may defer  compensation on
behalf of certain employees. The Plan is maintained primarily for the purpose of
providing  deferred  compensation  for a select  group of  management  or highly
compensated  employees,  within the meaning of Sections  201(2),  301(a)(3)  and
401(a)(1) of the Employee Retirement Income Security Act of 1974, as amended.

ARTICLE I.
DEFINITIONS

     Section  1.1  Account  shall mean the  bookkeeping  account  created by the
Company  pursuant to Article III of this Plan in accordance  with an election by
an Executive to receive deferred cash compensation under Article II hereof.

     Section 1.2 Annual Bonus shall mean any annual cash bonus or  compensation,
other than base salary,  payable to an Executive pursuant to the Companys annual
bonus  program,  as adopted from time to time,  including,  without  limitation,
annual cash bonuses made pursuant to the  Books-A-Million,  Inc. 2005  Incentive
Award Plan.

     Section 1.3 Base Salary shall mean an  Executives  base salary as in effect
from time to time.

     Section 1.4 Board shall mean the Board of Directors of the Company.

     Section  1.5 Change in Control  shall mean any change in the  ownership  or
effective control of the Company,  or in the ownership of a substantial  portion
of the assets of the Company,  as described in Section  409A(a)(2)(A)(v)  of the
Code or any  other  Change  in  Control  Event as  defined  in  accordance  with
Department of Treasury guidance  promulgated pursuant to Section 409A, including
without limitation Notice 2005-1 and such other interpretive  guidance as may be
issued after the Effective Date.

     Section 1.6 Code shall mean the Internal Revenue Code of 1986, as amended.

     Section 1.7 Committee shall mean the Compensation Committee of the Board.

     Section 1.8 Common Stock shall mean the common  stock of the  Company,  par
value $0.01 per share.

     Section  1.9  Company  shall  have the  meaning  set forth in the  recitals
hereto.

     Section  1.10  Deferral  Election  Form shall have the meaning set forth in
Section 2.3.

     Section 1.11 Deferred  Cash Account  shall mean the Account  created by the
Company  pursuant to Article III of this Plan in accordance  with an election by
an  Executive  to treat a portion of  Deferred  Compensation  as  invested in an
interest bearing account pursuant to Article II hereof.

     Section  1.12  Deferred  Compensation  shall have the  meaning set forth in
Section 3.1.

     Section  1.13  Deferred  Stock Unit shall mean the right of an Executive to
receive  one  share of  Common  Stock  upon a  distribution  of his  Account  in
accordance with Article IV.

     Section 1.14 Deferred Stock Unit Account shall mean the Account  created by
the Company  pursuant to Article III of this Plan in accordance with an election
by an  Executive  to treat a portion of  Deferred  Compensation  as  invested in
Common Stock pursuant to Article II hereof.

     Section 1.15 An Executive shall be Disabled if such Executive (a) is unable
to engage  in any  substantial  gainful  activity  by  reason  of any  medically
determinable  physical or mental  impairment  which can be expected to result in
death or can be  expected  to last for a  continuous  period of not less than 12
months,  or (b) is, by reason of any medically  determinable  physical or mental
impairment  which can be  expected to result in death or can be expected to last
for a continuous period of not less than 12 months, receiving income replacement
benefits  for a period of not less than 3 months  under an  accident  and health
plan covering employees of the Employer. The Committee shall have full and final
authority, which shall be exercised in its discretion, to determine conclusively
whether an Executive is Disabled,  and shall make such determination  consistent
with Section 409A.

     Section  1.16  Dividend  Equivalent  shall  have the  meaning  set forth in
Section 3.2(b).

     Section  1.17  Effective  Date  shall  have the  meaning  set  forth in the
recitals hereto.

     Section 1.18  Employer  shall mean the Company and any of its  subsidiaries
that are selected by the Board to participate in the Plan.

     Section  1.19  Executive  shall  mean a person  who is an  employee  of any
Employer  and  who is a  member  of a  select  group  of  management  or  highly
compensated  employees,  within the meaning of Sections  201(2),  301(a)(3)  and
401(a)(1) of the Employee Retirement Income Security Act of 1974, as amended.

     Section 1.20 Fair Market Value means,  as of any given date,  (a) if Common
Stock is traded on an exchange,  the closing price of a share of Common Stock as
reported in the Wall Street Journal for the first trading date immediately prior
to such date during which a sale occurred;  or (b) if Common Stock is not traded
on an exchange but is quoted on NASDAQ or a successor or other quotation system,
(i) the last sales price (if Common  Stock is then  listed as a National  Market
Issue  under the NASD  National  Market  System)  or (ii) the mean  between  the
closing  representative bid and asked prices (in all other cases) for the Common
Stock on the date  immediately  prior to such date on which sales  prices or bid
and asked  prices,  as  applicable,  are  reported  by NASDAQ or such  successor
quotation system; or (c) if Common Stock is not publicly traded, the fair market
value established by the Board acting in good faith.

     Section 1.21 Fund shall have the meaning set forth in Section 3.4.

     Section 1.22 Interest shall mean simple interest  credited to an Executives
Deferred  Cash Account as of each  Interest  Credit  Date.  The rate of Interest
shall be equal to the interest rate on 10-year  United States  Treasury Notes as
of the applicable Interest Credit Date

     Section 1.23  Interest  Credit Date shall mean the date next  following the
end of each  calendar  year  which is  determined  by the  Board and as of which
Interest is credited to each Executives Account.

     Section 1.24 Plan shall have the meaning set forth in the recitals hereto.

     Section 1.25 Plan Year shall mean calendar year.

     Section 1.26  Performance-Based  Compensation shall mean  performance-based
compensation  payable to the Executive based on services performed over a period
of at least twelve months, determined in accordance with Section 409A.

     Section  1.27  Section  409A  shall  mean  Section  409A  of the  Code  and
Department  of  Treasury  regulations  and other  interpretive  guidance  issued
thereunder,  including  without  limitation Notice 2005-1 and any regulations or
other interpretive guidance as may be issued after the Effective Date.

     Section  1.28  Separation  from  Service of an  Executive  means his or her
separation  from service,  with respect to the Employers,  within the meaning of
Section  409A(a)(2)(A)(i)  of the Code,  as  determined  by the Secretary of the
Treasury.  The  Committee  shall have full and final  authority,  which shall be
exercised in its discretion,  to determine conclusively whether an Executive has
had a Separation from Service, and the date of such Separation from Service.

     Section 1.29 An Executive  shall be a Specified  Employee if such Executive
is a key  employee (as defined in Section  416(i) of the Code without  regard to
paragraph  (5)  thereof)  of the  Company  and the Company has any stock that is
publicly traded on an established securities market or otherwise,  as determined
in  accordance  with  Section  409A  (including   without   limitation   Section
409A(a)(2)(B)(i) of the Code).

     Section 1.30 Unforeseeable Emergency shall mean a severe financial hardship
to the Executive  resulting  from an illness or accident of the  Executive,  the
Executives  spouse, or a dependent (as defined in Section 152(a) of the Code) of
the Executive, loss of the Executives property due to casualty, or other similar
extraordinary  and  unforeseeable  circumstances  arising  as a result of events
beyond the control of the  Executive.  The  Committee  shall have full and final
authority, which shall be exercised in its discretion, to determine conclusively
whether an Executive has experienced an Unforeseeable  Emergency, and shall make
such determination consistent with Section 409A.

ARTICLE II.

ELECTION TO DEFER

     Section  2.1  Initial  Elections.  An  Executive  may  elect,  on or before
December 31 of any Plan Year, to defer payment of up to 50% of the  Executives
Base Salary and all or a specified  part of any Annual Bonus  earned  during the
Plan Year  following such election (and, to the extent set forth in Section 2.2,
in any  succeeding  Plan Years until the  Executive  ceases to be a  Executive);
provided,  however,  that with respect to Plan Year 2005 an Executive may elect,
within  thirty (30) days after the  Effective  Date, to defer up to 50% of the
Executives  Base Salary and all or a specified  part of any Annual Bonus payable
with  respect to  services  rendered  after the date of the  Executives  initial
election. Any person who shall become an Executive during any Plan Year, and who
was not an Executive of the Company on the preceding  December 31, may elect, no
later than thirty (30) days after the Executive  becomes eligible to participate
in the Plan, to defer payment of up to 50% of the Executives

     Base Salary and all or a specified  part of any Annual  Bonus  payable with
respect to services rendered during the remainder of such Plan Year (and, to the
extent  set forth in  Section  2.2,  for any  succeeding  Plan  Years  until the
Executive ceases to be an Executive). Any Base Salary or Annual Bonuses deferred
pursuant to this Paragraph  shall be paid to the Executive at the time(s) and in
the manner specified in Article IV hereof, as designated by the Executive.

     Section 2.2 Subsequent Elections. With respect to Plan Years following Plan
Year 2005, if an Executive fails to submit a Deferral  Election Form by December
31 of the Plan Year  immediately  prior to such  Plan  Year,  the  amount of the
deferral election for such Plan Year shall be zero; provided,  however, that, to
the extent permitted by Section 409A, a Deferral  Election Form may provide that
that the  election  shall  continue  from  Plan  Year to Plan  Year  unless  the
Executive  terminates it by written request delivered to the Companys  Secretary
prior to the  commencement  of the Plan Year for which the  termination is first
effective.

     Section 2.3 Deferral  Election  Form.  The election to  participate  in the
Plan,  manner  of  payment  and  investment  election  shall  be  designated  by
submitting a deferral election form in substantially the form attached hereto as
Exhibit A (as it may be revised from time to time,  the Deferral  Election Form)
to the Companys Secretary.

     Section  2.4  Limitations  on  Re-Deferrals.  In the event  that a Deferral
Election Form permits,  under a subsequent  election by the Executive to delay a
distribution,  or to change the form of distribution,  such subsequent  election
shall satisfy the  requirements  of Section 409A (including  without  limitation
Section 409A(a)(4)(C) of the Code), and:

     (a) Such subsequent election may not take effect until at least twelve (12)
months after the date on which the election is made;

     (b) In the case such  subsequent  election  relates  to a  distribution  or
payment not  described in Section  4.1(b),  (c) or (f),  the first  payment with
respect to such  election may be deferred for a period of not less than five (5)
years from the date such distribution or payment otherwise would have been made;
and

     (c) In the case such  subsequent  election  relates  to a  distribution  or
payment  described in Section  4.1(d),  such  election may not be made less than
twelve  (12) months  prior to the date of the first  scheduled  distribution  or
payment under Section 4.1(d).

     Section 2.5 Performance-Based  Compensation.  Notwithstanding any provision
of the  Plan  to the  contrary,  the  Committee  may,  in its  sole  discretion,
determine that an Executive may elect to  irrevocably  defer all or a portion of
any Performance  Based  Compensation  such Executive may be entitled to receive,
provided  that such  election is made no later than six months before the end of
the performance period relating to such Performance-Based Compensation.

ARTICLE III.

DEFERRED COMPENSATION ACCOUNTS

     Section 3.1  Bookkeeping  Accounts.  The Company  shall  maintain  separate
bookkeeping  accounts  for the Base Salary and Annual  Bonuses  deferred by each
Executive (the Deferred Compensation).

     Section 3.2 Deferred Stock Unit Account.

     (a) As of the date that any Deferred Compensation would otherwise have been
payable to an Executive, the Company shall credit such Executives Deferred Stock
Unit Account with that number of Deferred  Stock Units equal to the ratio of (i)
the  aggregate  value of the  designated  portion of Deferred  Compensation  the
Executive  elects to be deemed invested in Common Stock, to (ii) the Fair Market
Value per share of Common Stock as of such date.

     (b) As of the date the  Company  pays any  dividend  (whether in cash or in
kind) on shares of Common Stock,  each  Executives  Deferred  Stock Unit Account
shall be  credited  with that  number of  Deferred  Stock  Units  (the  Dividend
Equivalents)  equal to the ratio of (i) the aggregate value of the dividend that
would  have been  payable on the  Deferred  Stock  Units  held by the  Executive
immediately  prior  to  such  payment  date  had  the  shares  of  Common  Stock
represented  by such Deferred  Stock Units been  outstanding  as of such payment
date to (ii) the Fair Market Value per share of Common Stock as of such date.

     Section 3.3 Deferred Cash Account

     (a) As of the date that any Deferred Compensation would otherwise have been
payable to an Executive,  the Company shall credit the Executives  Deferred Cash
Account  with  the  aggregate  value  of  the  designated  portion  of  Deferred
Compensation  that the  Executive  elects to be deemed  to be  invested  in such
Deferred Cash Account.

     (b) As of each  Interest  Credit  Date,  the  balance  of  each  Executives
Deferred Cash Account shall be credited with Interest.

     Section 3.4  Transfer  Between  Accounts.  An  Executive  may elect to have
amounts  transferred between his or her Deferred Cash Account and Deferred Stock
Unit  Account as of any  Interest  Credit Date using such forms as the Board may
designate  from time to time.  Such transfer shall be made using the Fair Market
Value of a share of Common Stock on such  transfer  date to determine the amount
to be credited and debited from the applicable Accounts.

     Section 3.5 Unsecured General Creditor; Fund. Deferred Compensation and any
deemed  earnings with respect thereto shall be held in the general assets of the
Company  and no  separate  fund or trust shall be created or moneys set aside on
account  of the  Account.  To the  extent  that any  person  acquires a right to
receive  distributions  from the Company under the Plan,  such right shall be no
greater  than the  right  of any  unsecured  general  creditor  of the  Company.
Notwithstanding the foregoing,  the Committee,  in its discretion,  may elect to
establish a fund (the Fund)  containing  assets equal to the amounts credited to
Executives  Accounts,  and may elect in its discretion to designate a trustee to
hold the Fund in trust; provided, however, that such Fund shall remain a general
asset of the Company  subject to the rights of  creditors  of the Company in the
event of the Companys bankruptcy or insolvency as defined in any such trust.

ARTICLE IV.

PAYMENT OF DEFERRED COMPENSATION

     Section 4.1 Distributions.  Subject to Sections 4.1(a)-(f) and 4.2, amounts
contained  in an  Executives  Account  shall be  distributed  as the  Executives
election  (made  pursuant to Section  2.3) shall  provide.  Notwithstanding  the
foregoing,  all amounts contained in an Executives  account shall be distributed
in  accordance  with  the  requirements  of  Section  409A  (including   without
limitation Section 409A(a)(2) of the Code), and shall not be distributed earlier
than:

     (a) The date of the Executives Separation from Service;

     (b) The date the Executive becomes Disabled;

     (c) The date of the Executives death;

     (d) A specified time (or pursuant to a fixed schedule)  specified under the
Deferral Election Form at the date of the deferral compensation;

     (e) To the extent  provided by the Secretary of the  Treasury,  a Change in
Control; or

     (f) The  occurrence  of an  Unforeseeable  Emergency  with  respect  to the
Executive.  The  requirement  of this  Section  4.1(f)  shall be met only if, as
determined under Treasury  Regulations  under Section  409A(a)(2)(B)(ii)  of the
Code, the amounts distributed with respect to the Unforeseeable Emergency do not
exceed the  amounts  necessary  to satisfy  such  Unforeseeable  Emergency  plus
amounts  necessary  to pay  taxes  reasonably  anticipated  as a  result  of the
distribution,  after taking into account the extent to which such  Unforeseeable
Emergency  is or  may be  relieved  through  reimbursement  or  compensation  by
insurance or otherwise or by liquidation of the Executives assets (to the extent
the  liquidation  of  such  assets  would  not  itself  cause  severe  financial
hardship).

     Section 4.2  Specified  Employee.  If at the time any  distributions  would
otherwise be made to an Executive  pursuant to Section 4.1(a) the Executive is a
Specified Employee, the requirement of paragraph 4.1(a) shall be met only if the
distributions  may not be made  before the date  which is six  months  after the
Executives  Separation from Service (or, if earlier,  the date of the Executives
death).

     Section 4.3 Form of Distribution.  All distributions from the Plan shall be
made as follows:  (a) amounts deferred in the Deferred Stock Unit Accounts shall
be  distributed  in the form of whole  shares of Common  Stock  with  fractional
shares paid in cash;  and (b) amounts  deferred in the  Deferred  Cash  Accounts
shall be distributed in cash.

     Section 4.4 Payment of Interest. At the time of each installment payment or
lump sum payment made pursuant to Section 4.1, Interest which has been deemed to
have accrued since the previous  Interest Credit Date shall be paid with respect
to each applicable Executives Deferred Cash Account. The amount of such payments
shall be calculated using the methodology set forth in Section 3.3.

     Section 4.5 No  Acceleration.  The time or schedule of any  distribution of
any  shares  of  Common  Stock  shall not be  accelerated,  except as  otherwise
permitted under Section 409A (including without limitation Section 409A(a)(3) of
the Code).

     Section 4.6 Beneficiary Designation. Each Executive shall have the right to
designate  a  beneficiary  who is to  succeed  to his or her  right  to  receive
payments hereunder in the event of death. Except as may otherwise be provided in
any Deferral Election Form, in the event of the Executives death, the balance of
the amounts  contained in the  Executives  Account  shall be paid, in accordance
with Section 4.1, to the Executives or former  Executives  beneficiary (or if no
beneficiary has been designated,  to his estate) in full on the first day of the
Plan Year  following  the Plan Year in which he or she dies. No  designation  of
beneficiary  or change in  beneficiary  shall be valid  unless it is in  writing
signed by the Executive and filed with the Companys Secretary.

ARTICLE V.

ADMINISTRATION; AMENDMENT

     Section  5.1  Administration.   The  Plan  shall  be  administered  by  the
Committee.  The Committee  may delegate  certain  administrative  authority to a
subcommittee  of the Committee or to one or more  employees of the Company,  but
shall  retain  the  ultimate  responsibility  for  the  interpretation  of,  and
amendments to, the Plan. Members of the Committee shall not be liable for any of
their  actions  or  determinations  made  in  good  faith  with  respect  to the
administration  of the Plan.  Except to the extent superseded by the laws of the
United States, the laws of the State of Delaware, without regard to its conflict
of laws  principles,  shall  govern in all  matters  relating  to the Plan.  All
expenses  related  to plan  administration  shall  be paid by the  Company.  All
decisions made by the Committee with respect to issues  hereunder shall be final
and binding on all parties.

     Section 5.2 Change in  Capitalization  of the Company.  In the event of any
stock  dividend,  stock  split,  combination  or  exchange  of  shares,  merger,
consolidation, spin-off, recapitalization or any other corporate event affecting
the Common Stock or the share price of the Common Stock,  the Committee  may, in
its sole discretion,  make such equitable  adjustments,  if any, with respect to
the Executives Accounts (including, without limitation,  adjusting the number of
Deferred Stock Units credited thereto and/or the kind of securities  represented
thereby), as the Committee may deem necessary or appropriate to prevent dilution
or  enlargement  of the  benefits  or  potential  benefits  intended  to be made
available under this Plan and to reflect such changes.

     Section 5.3  Nonassignability.  Except to the extent  required by law,  the
right of any  Executive  or any  beneficiary  to any  benefit or to any  payment
hereunder  shall not be  subject  in any  manner to  attachment  or other  legal
process for the debts of such Executive or beneficiary,  and any such benefit or
payment  shall not be subject  to  alienation,  sale,  transfer,  assignment  or
encumbrance.

     Section 5.4 Amendment. The Plan may be amended,  suspended or terminated in
whole or in part from time to time by the Committee  except that,  except as set
forth in Section 5.5, no amendment,  suspension,  or termination  shall apply to
the payment to any  Executive  or  beneficiary  of a deceased  Executive  of any
amounts previously credited to a Executives Account.

     Section 5.5 Section  409A.  The Plan and  Deferral  Election  Form shall be
interpreted  in accordance  with,  and shall comply in form and operation  with,
Section 409A.  Notwithstanding  any  provision of the Plan to the contrary,  the
Committee  may adopt such  amendments  to the Plan and the  applicable  Deferral
Election  Form or adopt other  policies and  procedures  (including  amendments,
policies and procedures  with  retroactive  effect),  or take any other actions,
that the Committee  determines  are necessary or  appropriate  to (a) exempt the
deferral  from  Section  409A of the  Code  and/or  preserve  the  intended  tax
treatment of the benefits  provided with respect to the deferral,  or (b) comply
with the requirements of Section 409A (including  without limitation any related
Department of Treasury guidance).

                                   * * * * *

     I hereby  certify  that the Plan was adopted by the Board of  Directors  of
Books-A-Million, Inc. on August 16, 2005, effective as of September 1, 2005.

                                    ___________________________________

                                    Sandra B. Cochran
                                    President and CEO


Books-A-Million, Inc.
Executives Deferred Compensation Plan
DEFERRAL ELECTION FORM

     SEND COMPLETED FORM TO: Richard S. Wallington;  Chief Financial  Officer of
Books-A-Million,  Inc.; 402 Industrial Lane, P.O. Box 19768, Birmingham, Alabama
35219; Fax: (205) 945-1772.

         Initial Enrollment (complete Sections 1, 2, 3 & 4)

         Change Beneficiary (complete Sections 3 & 4)

________________________________________________________________________________
________________________________________________________________________________
Social Security Number          Last Name              First Name            MI
________________________________________________________________________________
Mailing Address            City      State       Zip Code      Daytime Telephone
________________________________________________________________________________

     Section 409A: I understand that  notwithstanding any other provision of the
Books-A-Million,  Inc.  Executives  Deferred  Compensation  Plan  (as  it may be
amended from time to time,  the Plan) or this Deferral  Election  Form, the Plan
and this Deferral  Election Form shall be  interpreted  in accordance  with, and
incorporate  the terms and  conditions  required  by,  Section  409A of the U.S.
Internal  Revenue Code of 1986,  as amended  (together  with any  Department  of
Treasury   regulations  and  other  interpretive   guidance  issued  thereunder,
including without  limitation any such regulations or other guidance that may be
issued after the date  hereof,  Section  409A).  I further  understand  that the
Committee (as defined in the Plan) may, in its discretion, adopt such amendments
to the  Plan  and this  Deferral  Election  Form or  adopt  other  policies  and
procedures  (including  amendments,  policies and  procedures  with  retroactive
effect), or take any other actions, as the Committee determines are necessary or
appropriate  to  comply  with the  requirements  of  Section  409A.  Finally,  I
understand that the time or schedule of  distributions  that I elect pursuant to
Section 2,  below,  may not be  accelerated  except as  otherwise  permitted  by
Section 409A.


________________________________________________________________________________

SECTION 1 - DEFERRAL ELECTION

     Pursuant to the Plan, I hereby  elect to defer  receipt of all or a portion
of the Base  Salary  and  Annual  Bonus  (as  defined  in the Plan)  that  would
otherwise  become  payable to me after  _____________,  2005 with respect to the
2005 calendar year in accordance  with the  percentages  indicated  below (whole
number percentages only):

A.      2005 Annual Bonus

     _______% of the Annual Bonus that would otherwise be payable to me pursuant
to the Companys  annual bonus program,  as adopted from time to time,  (the 2005
Annual Bonus) shall be credited to my Deferred Stock Unit Account (as defined in
the Plan);

     _______%  of my 2005 Annual  Bonus  shall be  credited to my Deferred  Cash
Account (as defined in the Plan);

     _______% of my 2005 Annual Bonus shall not be  deferred,  but shall be paid
to me directly as it becomes payable.

B.      Base Salary

     _______% of my Base Salary that would  otherwise  be payable to me pursuant
to the Companys general payroll practices shall be credited to my Deferred Stock
Unit Account;

     _______% of my Base Salary shall be credited to my Deferred Cash Account;

     _______% of the Base Salary shall not be deferred,  but shall be paid to me
directly as it becomes payable (must be at least 50%).

     I understand  that this election will remain in effect only with respect to
the  deferral of my Base Salary and Annual  Bonus earned  during  calendar  year
2005. I further  understand  that Base Salary and Annual Bonus deferrals will be
credited  to my  Account  under the Plan and that my rights  to my  Account  are
unfunded  and  unsecured  and are no  greater  than the  rights of an  unsecured
general creditor of the Company.

________________________________________________________________________________

SECTION 2  ACCOUNT DISTRIBUTION

A.      Commencement of Distribution

     Except as  otherwise  set forth in Section 2C,  below,  I elect to commence
receiving  distributions  from my  Account  in  accordance  with  the  following
election  (check  one):  As of  the  first  day of the  first  calendar  quarter
following  the  calendar  quarter in which I resign or  otherwise  experience  a
Separation  from  Service (as defined in the Plan);  or As of the earlier of (1)
January 1 of the __________  (insert number) calendar year after the deferral is
made  (not less than 3 nor more than 10) or (2) as of the first day of the first
calendar  quarter  following the calendar quarter in which I resign or otherwise
experience a Separation from Service.

B.      Form of Distribution

     Except as  otherwise  set forth in Section  2C,  below,  I elect to receive
distributions  from my Account in accordance with the following  election (check
one): In one lump sum; or In _______ (insert  number) equal annual  installments
(not less than 2 nor more than 10).  I  understand  that the first  distribution
from my Account shall be payable as of the date I selected in Section 3A, above,
and that if I elect annual installment payments I will receive an installment as
of each January 1 immediately  following the first distribution until my Account
has been distributed in full.  Notwithstanding the foregoing,  I understand that
if I am determined by the  Administrator to be a Specified  Employee (as defined
in the Plan) at the time any  distribution  would  otherwise be made pursuant to
this Section 2, then no such  distribution  or payment shall be made or commence
until six months after my Separation from Service.

C.      Change in Control

     Notwithstanding  any other provision of this Deferral  Election Form to the
contrary,  to the extent permitted by the Secretary of the Treasury  pursuant to
Section 409A, I elect to have my Account  automatically and fully distributed to
me, in one lump sum immediately  following the occurrence of a Change in Control
(as defined in the Plan).

________________________________________________________________________________

SECTION 3 - BENEFICIARY DESIGNATION

     If you die before you  receive  full  payment of your  Account,  the amount
remaining  in  your  Account  will be  paid  in a lump  sum to your  Beneficiary
designated in this Section 3:

________________________________________________________________________________
Social Security Number          Last Name        First Name                  MI
________________________________________________________________________________
Mailing Address            City         State     Zip Code             Telephone
________________________________________________________________________________

SECTION 4 - AUTHORIZATION

     I agree that my  successors  in  interest  and my assigns  and all  persons
claiming under me shall, to the extent  consistent with applicable law, be bound
by the statements contained herein and by the provisions of the Plan as they now
exist and as they may be amended from time to time.  I have read and  understand
this form and hereby authorize the  Administrator to take all actions  indicated
on this form.

_______________________________________________________________________________
Executives Signature                                             Date
_______________________________________________________________________________
This section for Company use only.
Date approved:_________________________  By:__________________________

EX-10

                             Books-A-Million, Inc.
                Form of Letter Regarding the 2005 Bonus Program

                                 August 16, 2005

[Name] [Address 1] [Address 2]

Dear [Name]:

     This letter is to confirm your compensation for the year ending January 28,
2006.  Your annual  salary will be  $____________  and your maximum bonus payout
will be ___% of your salary.  You are eligible to receive additional amounts for
the earnings portion of your bonus if the Company earnings exceed certain levels
(see chart below), however your total bonus potential is still capped at ___% of
your base  salary.  Bonuses  will be paid out  based  upon the  company  meeting
certain pre-tax earnings goals as well as meeting personal goals.

     The earnings  portions of your bonus will be based on the chart below.  The
Company  must earn  $XX,XXX,XXX  in pre-tax  earnings for you to receive 100% of
your bonus related to company earnings performance.  In addition, if the company
does not meet pre-tax earnings of $X,XXX,XXX no portion of bonuses will be paid,
including your personal goals bonus.

     To be eligible  for any bonus  payout,  you must be employed by the company
through the annual  financial  statement audit  (approximately  March 17, 2006).
Payments will be based on audited  financial  statements.  Your  employment with
Books-A-Million is not for any definite  duration,  and can be terminated at any
time by you or the company.

Salary                                                 $     XXXXXX
Maximum Bonus %                                                 xx%
Maximum Bonus                                          $     XXXXXX
Personal Goals %                               xx%     $     XXXXXX
Company Performance %                          xx%     $     XXXXXX

Company Performance Bonus Goal
                                                Bonus Payment of
Pre-Tax Earnings        Bonus Payout %            Company Goals
- ----------------        --------------          ----------------
    XXXXXXXX                xx.x%                   XXXXXXXX
    XXXXXXXX                xx.x%                   XXXXXXXX
    XXXXXXXX                xx.x%                   XXXXXXXX
    XXXXXXXX                xx.x%                   XXXXXXXX
    XXXXXXXX                xx.x%                   XXXXXXXX






Personal Performance Bonus Goals

                                                Bonus Payout
       #                Description            Personal Goals
- --------------         -------------           --------------
       1                 XXXXXXXX                 XXXXXXXX
       2                 XXXXXXXX                 XXXXXXXX
       3                 XXXXXXXX                 XXXXXXXX

                          Total:                  XXXXXXXX

                          Capped at               XXXXXXXX


     Your hard work and dedication over the past year is greatly appreciated. We
are all  striving to achieve the best  results for the company and are  thankful
for your past and future contributions to the company's success.

                                                          Sincerely,

                                        ----------------------------
                                        Name                    Date
                                        Title




     I,  __________________________,  hereby understand and willingly accept the
terms and  conditions  for this  bonus  program  for FY 2006.  I will  strive to
achieve all objectives set forth as conditions of employment at Books-A-Million.

                                        ----------------------------
                                        Name                    Date