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                                                                   Exhibit 10.29

                                 RENT-WAY, INC.

                              EMPLOYMENT AGREEMENT

         This agreement is made as of January 7, 2000, and has been entered into
between Rent- Way, Inc., a Pennsylvania corporation with its principal offices
at One RentWay Place, Erie, Pennsylvania 16505 (the "Employer" or "Company"),
and WILLIAM A. MCDONNELL (the "Employee").

         WHEREAS, the Company desires to employ the Employee on the terms and
conditions set forth herein; and

         WHEREAS, the Employee desires to be employed by the Company on the
terms and conditions set forth herein;

         NOW THEREFORE, the Company and the Employee agree as follows:

         1.       EMPLOYMENT. The Company hereby employs the Employee, and the
                  Employee hereby accepts continue employment, upon the terms
                  and conditions hereinafter set forth.

         2.       TERM. Subject to the provisions of termination as hereinafter
                  provided, the term of this Agreement shall begin on February
                  1, 2000 and shall terminate on February 1, 2003 (being three
                  years after the commencement date); provided, however, that
                  commencing on the date which is one year prior to the date of
                  termination, and on each anniversary of such date (such date
                  and the date of each anniversary thereof being a "Renewal
                  Date"), the term shall automatically be extended so to
                  terminate two (2) years from such Renewal Date, unless at
                  least sixty (60) days prior to such Renewal Date either party
                  hereto gives notice to the other that the term shall not be so
                  extended.

         3.       POSITION AND DUTIES. During the term of this Agreement, the
                  Employee shall serve as a Vice-President and Chief Financial
                  Officer of the Company with at least such statutory duties and
                  responsibilities as exist as of the date hereof and with such
                  duties and responsibilities as may be provided in the By-Laws
                  of the Company. The place of employment shall be at the
                  principal executive offices of the Company in Erie,
                  Pennsylvania. The Employee agrees to devote all of his
                  business time, skill, attention and best efforts during normal
                  business hours to the business of the Company and to the
                  extent necessary to discharge the responsibilities assigned
                  during the term of employment hereunder, except for service on
                  other corporation, civic or charitable boards or committees
                  not significantly interfering with the Employee's duties
                  hereunder and usual, ordinary and customary periods of
                  vacation.


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         4.       COMPENSATION.

                  (a)      Base Salary. For all services rendered by Employee
                           under this Agreement, the Company shall pay a base
                           salary of $190,000 per year during the first year of
                           the Agreement. The Employee will receive annual
                           salary increases for the second and the third years
                           of the Agreement equivalent to 4% of the base salary.
                           Commencing the fourth year of the Agreement (if
                           extended in accordance with paragraph 2 herein), the
                           Employee's salary will be increased to reflect the
                           percentage increase in the Consumer Price Index for
                           Western Pennsylvania (the "CPI") for the most
                           recently completed year. Upon issuance of the CPI for
                           the Western Pennsylvania region, Employee's Base
                           Salary will be increased retroactively to January of
                           the year following the year for which the CPI is
                           issued. The Employee's salary will be paid in
                           installments in conformity with the regular payroll
                           practices of the Company. The Employee's salary shall
                           also be reviewed annually by the Compensation
                           Committee of the Board of Directors of the Company
                           and may be increased on the basis of individual and
                           corporate performance, by criteria and standards
                           determined by the Compensation Committee. Any
                           increase in Salary or other compensation shall in no
                           way limit or reduce any other obligation of the
                           Company to the Employee, and once established, and
                           the Employee's increased Base Salary shall not
                           thereafter be reduced.

                  (b)      Incentive Compensation: Bonuses. In addition to the
                           Base Salary, the Employee shall be entitled to (i)
                           participate in such incentive plans (including the
                           right to defer such bonus) made available by the
                           Company to its executives and key employees and (ii)
                           to receive such additional bonus or discretionary
                           compensation payments as the Board of Directors of
                           the Company or the Compensation Committee may
                           determine from time to time. Incentive plan
                           participation and additional bonus or discretionary
                           compensation payment shall be reviewed annually by
                           the Compensation Committee of the Board of Directors
                           and shall be awarded on the basis of corporate
                           performance, by criteria and standards established by
                           the Board of Directors of the Compensation Committee
                           of the Board, in their sole discretion.

                  (c)      Expenses. During the term of employment hereunder,
                           the Employee shall be entitled to receive prompt
                           reimbursement for all reasonable expenses incurred in
                           accordance with the policies and procedures of the
                           Company, as may be in force from time to time.

                  (d)      Benefits. During the term of employment, the Employee
                           shall be entitled to receive a package of benefits
                           that includes all of the programs, plans and
                           perquisites currently provided by the Company to its
                           employees, as long as such programs, plans and
                           perquisites are continued by the Company.


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         5.       TERMINATION.

                  (a)      Termination for Disability. In the event that
                           Employee shall have been prevented from substantially
                           rendering the services required under this Agreement
                           by reason of his disability (as confirmed by medical
                           authority satisfactory to the Company and Social
                           Security guidelines) for a period of six (6)
                           consecutive months (or 180 days), the Company shall
                           have the right to terminate this Agreement upon
                           thirty (30) days written notice, provided such
                           disability continues during said notice period.

                  (b)      Termination for Employee's Breach. The Company shall
                           have the right to terminate this Agreement and the
                           employment hereunder if Employee violates his
                           responsibilities under paragraph 3 of this Agreement
                           and such violation continues after the Employee's
                           having received notice of such violation and thirty
                           (30) days to cure such violation(s) to the
                           satisfaction of the Company's Board of Directors. The
                           Company may immediately terminate this Agreement upon
                           (i) determination by the Company's Board of Directors
                           that Employee has willfully defaulted on a material
                           obligation of this Agreement, (ii) determination by
                           the Company's Board of Directors that there has been
                           a defalcation of the Company's funds by the Employee,
                           (iii) conviction of Employee on a felony charge or
                           conviction of a misdemeanor which impairs the
                           Employee's ability to substantially perform his
                           duties with the Company, or (iv) determination by the
                           Company's Board of Directors that the Employee has
                           had unauthorized discussions of the Company's
                           business activities or improperly disclosed trade
                           secrets or confidential information concerning the
                           Company's business activities or proposed business
                           activities. At such time as the Company's Board of
                           Directors addresses such charges, the Employee may
                           submit a written statement regarding such claims and
                           present a defense against such claims.

                  (c)      Termination for Employer's Breach. Employee shall
                           have the right to terminate this Agreement if the
                           Company materially breaches any of the provisions
                           hereof and such breach is not cured within thirty
                           (30) days after the Company has received written
                           notice from the Employee. In such event, or in the
                           event of a wrongful termination of the Employee, all
                           moneys due to the Employee through the term of this
                           Agreement shall be paid by the Company in a lump sum
                           amount within thirty (30) days of the Employee's
                           termination, with bonuses to be paid when earned
                           through the remainder of the term of this Agreement.
                           Employee shall have no obligation to mitigate losses
                           or damages incurred as a result of such termination.


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                  (d)      Termination by Death. If employment terminates by
                           reason of the Employee's death, the Company will pay
                           the Employee's estate a lump sum payment equivalent
                           to six (6) months salary; other benefits will be
                           determined in accordance with the company's
                           survivor's benefits, insurance and other applicable
                           programs and plans, then in effect.

         6.       CONFIDENTIAL AND PROPRIETARY INFORMATION.  Employee agrees to
                  keep secret all confidential information, trade secrets or
                  proprietary information acquired by the Employee during his
                  employment concerning the business and affairs of the Company
                  (the "Information") and further agrees for a period of one (1)
                  year after the termination of his employment, for any reason,
                  not to disclose any such Information to any person, firm or
                  corporation other than that as directed by the Employer,
                  unless and until such Information becomes known outside of the
                  Company (other than through a violation by the Employee of his
                  obligations hereunder). Employee agrees, upon the Company's
                  request, to execute a confidential non-disclosure agreement,
                  if requested.

         7.       MISCELLANEOUS PROVISIONS.

                  (a)      Successors. The Company will require any successor
                           (whether direct or indirect, by purchase, merger,
                           consolidation or otherwise) to all or substantially
                           all of the business and/or assets of the Company to
                           expressly assume and agree to perform this Agreement
                           in the same manner and to the same extent that the
                           Company would be required to perform if no such
                           succession had taken place. Failure of the Company to
                           obtain such assumption and agreement prior to the
                           effectiveness of any such succession shall be a
                           breach of this Agreement and shall entitle the
                           Employee to compensation from the Company in the same
                           amount and on the same terms as the Employee is
                           entitled to hereunder if the Employee terminated his
                           employment for good cause.

                  (b)      Binding Agreement. This Agreement shall inure to the
                           benefit of and be enforceable by the Employee's
                           personal or legal representatives, executors,
                           administrators, successors, heirs, distributees,
                           devises and legatees. If the Employee should die
                           while any amount would still be payable to the
                           Employee hereunder if the Employee had continued to
                           live, all such amounts, unless otherwise provided
                           herein, shall be paid in accordance with the terms of
                           this Agreement, to the employee's devisee, legatee or
                           other designee, or, if there is not such designee, to
                           the Employee's estate.

                  (c)      Notices and Communications. All notices and
                           communications hereunder shall be in writing and
                           shall be hand delivered or sent postage prepaid by
                           registered certified mail, return receipt requested,
                           to the addresses first


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                           written or to such other address of which notice
                           shall have been given in the manner herein provided.

                  (d)      Entire Agreement: Non-Assignment. This Agreement may
                           not be modified, amended, changed or discharged,
                           except by writing signed by the parties hereto, and
                           then only to the extent set forth in the writing.
                           This Agreement shall be binding upon and inure to the
                           benefit of the parties hereto, and any administrator,
                           executor and successor of the Company. This Agreement
                           may not be assigned by either of the parties without
                           the prior written consent of the other party.

                  (e)      Legal Expenses. All legal fees and expenses incurred
                           by the Employee in attempts to receive the benefits
                           granted hereunder or to enforce this Agreement or any
                           of its terms will be paid by the Company providing
                           that Employee's claims are not dismissed in a summary
                           proceeding.

         IN WITNESS WHEREOF, the parties have executed this Employment Agreement
to be effective as of the day and the year first written above.




EMPLOYEE:                                   RENT-WAY, INC.


/s/ William McDonnell                       /s/ William E. Morgenstern
-----------------------------               -----------------------------
                                            (Authorized Officer)