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                                                                   EXHIBIT 10.16


                               THIRD AMENDMENT TO
                         FRANCHISEE FINANCING AGREEMENT

         This Third Amendment to Franchisee Financing Agreement ("Amendment") is
made and entered into by and among Textron Financial Corporation, a Delaware
corporation ("TFC"), ColorTyme, Inc., a Texas corporation ("ColorTyme"), and
Rent-A-Center East, Inc., a Delaware corporation formerly known as
Rent-A-Center, Inc. ("RAC").

                                    RECITALS

         A. TFC, ColorTyme and RAC are parties to that certain Amended and
Restated Franchisee Financing Agreement dated March 27, 2002, which was amended
by that certain First Amendment to Franchisee Financing Agreement dated July 23,
2002, and that certain Second Amendment to Franchisee Financing Agreement dated
September 30, 2002 (as previously amended, the "Agreement"). Capitalized terms
used in this Amendment that are not otherwise defined herein shall have the
meanings assigned to such terms in the Agreement.

         B. TFC, ColorTyme and RAC desire to amend the Agreement on the terms
set forth in this Amendment.

                                    AGREEMENT

         In consideration of the premises and other valuable consideration, the
receipt and adequacy of which are hereby acknowledged, and intending to be
legally bound hereby, TFC, ColorTyme and RAC agree as follows:

         1. The Guarantor. RAC recently changed its corporate name, effective
December 31, 2002, from "Rent-A-Center, Inc." to "Rent-A-Center East, Inc." From
and after the effective date of such name change, all references in the
Agreement to "RAC" shall mean Rent-A-Center East, Inc., a Delaware corporation
formerly known as Rent-A-Center, Inc. RAC hereby reaffirms all of its
obligations under the Agreement, including specifically but without limitation
its obligations under the guaranty set forth in Section 5.1 of the Agreement,
all of which shall continue in full force and effect. RAC, as the guarantor of
all debts, liabilities and obligations of ColorTyme to TFC under the Agreement,
hereby consents to the amendment of the Agreement as provided herein.

         2. Interest Rates. Section 1.3 of the Agreement is hereby amended by
deleting the existing Section 1.3 in its entirety and substituting in place
thereof the following:

                  1.3 Interest Rates. The interest rate on each Receivable shall
         be determined in accordance with this Section 1.3.

                           (a) Unless otherwise agreed by TFC and ColorTyme and
                  except as otherwise provided in paragraphs (b) or (c) of this
                  Section 1.3, the interest rate on each Receivable shall be the
                  rate established by the following schedule: (i) for each Line
                  of Credit with a Credit Limit (as that term is hereinafter
                  defined) of $1,000,000 or less, the rate will be Prime plus
                  4.75%; (ii) for each Line of Credit with a Credit Limit of
                  more than $1,000,000, the rate will be Prime plus 3.75%; and
                  (iii) for



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                  each Term Loan, the rate will be the same as the rate
                  applicable to the Franchisee's Line of Credit on the date of
                  such Term Loan. For purposes of this section, "Prime" shall
                  mean the "prime rate" of interest as published in the "Money
                  Rates" section of the Wall Street Journal, as such rate may
                  change from time to time. The applicable interest rate will be
                  a floating rate; changes in such interest rate will be
                  established monthly, effective as of the last business day of
                  the preceding month. Interest will be calculated on the basis
                  of a 360-day year.

                           (b) Beginning with the calendar quarter ended June
                  30, 2003, the interest rate on Receivables may be adjusted
                  from time to time in accordance with this paragraph (b) of
                  this Section 1.3. On a quarterly basis, as of the end of each
                  calendar quarter, TFC shall determine the average spread ("the
                  LIBOR Spread") above the one (1) month London InterBank
                  Offered Rate paid on commercial paper by commercial finance
                  companies rated A2/P2, as reported by Bloomberg Professional,
                  during such calendar quarter. In the event the LIBOR Spread
                  declines by at least twenty-five basis points (25bp) from the
                  rate determined at the end of the previous calendar quarter,
                  the interest rate on Receivables shall thereafter be reduced
                  by twenty-five basis points (25bp) for each twenty-five basis
                  points (25bp) reduction in the LIBOR Spread for the calendar
                  quarter. For the calendar quarter ended March 31, 2003, the
                  LIBOR Spread shall be deemed to be 1.60. In the event the
                  LIBOR Spread subsequently increases by at least twenty-five
                  basis points (25bp) from the rate determined at the end of the
                  previous calendar quarter, the interest rate on Receivables
                  shall thereafter be increased by twenty-five basis points
                  (25bp) for each twenty-five basis points (25bp) increase in
                  the LIBOR Spread for the calendar quarter, but not above the
                  rates set forth in paragraph (a) of this Section 1.3. All
                  adjustments to the interest rates on Receivables effected
                  pursuant to this paragraph (b) of this Section 1.3 shall be in
                  increments of twenty-five basis points (25bp); each such
                  incremental adjustment shall require a change in the LIBOR
                  Spread of at least twenty-five basis points (25bp).
                  Notwithstanding anything in this paragraph (b) of this Section
                  1.3 to the contrary, in no event shall the interest rate on
                  Receivables be reduced below the following rates: (i) for each
                  Line of Credit with a Credit Limit of $1,000,000 or less,
                  Prime plus 3.75%; (ii) for each Line of Credit with a Credit
                  Limit of more than $1,000,000, Prime plus 2.75%; and (iii) for
                  each Term Loan, the rate applicable to the Franchisee's Line
                  of Credit on the date of such Term Loan.

                           (c) In the event TFC's credit rating is hereafter
                  increased to A1/P1, the interest rate on each Receivable shall
                  thereafter be the rate established by the following schedule:
                  (i) for each Line of Credit with a Credit Limit of $1,000,000
                  or less, the rate will be Prime plus 3.75%; (ii) for each Line
                  of Credit with a Credit Limit of more than $1,000,000, the
                  rate will be Prime plus 2.75%; and (iii) for each Term Loan,
                  the rate will be the same as the rate applicable to the
                  Franchisee's Line of Credit on the date of such Term Loan.



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         The interest rates specified in Section 1.3 of the Agreement, as
amended by this Section 2 of this Amendment, shall apply to all new Receivables
originated on or after March 31, 2003, and to all Receivables outstanding on
March 31, 2003, for which the Franchisees obligated to TFC thereunder consent to
the change in the interest rates on such Receivables to those established by
this Section 2; the interest rates on all Receivables outstanding on March 31,
2003, for which the Franchisees obligated to TFC thereunder do not consent to
the change in the interest rates on such Receivables to those established by
this Section 2 will continue at the existing rates, subject to the provisions of
Section 5 of this Amendment.

         3. Use of Proceeds. Section 1.6 of the Agreement is hereby amended by
deleting the existing Section 1.6 in its entirety and substituting in place
thereof the following:

                  1.6 Use of Proceeds. TFC will advance funds pursuant to a
         Franchisee's Line of Credit or Term Loan only for the following
         purposes: (i) the Franchisee's acquisition of Inventory; (ii) the
         Franchisee's acquisition or conversion of a Store; (iii) the buyout of
         an ownership interest in the Franchisee; and/or (iv) the Franchisee's
         working capital.

                           (a) Inventory. Advances for Inventory will be limited
                  to the lesser of (i) the cost of the Inventory acquired by the
                  Franchisee; (ii) the amount of the Franchisee's Credit Limit;
                  or (iii) the amount of the Franchisee's Advance Limit.

                           (b) Store Acquisitions and Conversions. Advances for
                  Store acquisitions and/or conversions (i.e., the acquisition
                  of existing ColorTyme Stores and/or the acquisition of other
                  "rent-to-own" stores for conversion to ColorTyme Stores) will
                  be limited to the lesser of (i) in the case of a Store that
                  has been open for business (either as a ColorTyme Store or as
                  another "rent-to-own" store) for one (1) year or more, the
                  product of the Average Monthly Revenue of the individual Store
                  multiplied by nine (9); (ii) the amount that would cause the
                  Debt-to-Revenue Ratio for the Franchisee to equal or exceed
                  5:1; (iii) except in the case of advances pursuant to a Term
                  Loan, the amount of the Franchisee's Credit Limit; and (iv)
                  the amount of the Franchisee's Advance Limit. For purposes of
                  this paragraph, "Debt-to-Revenue Ratio" shall mean the ratio
                  of (x) Funded Debt to (y) the Average Monthly Revenue of the
                  Franchisee (calculated on an aggregate basis for all Stores
                  owned and/or operated by such Franchisee and any and all
                  affiliates of such Franchisee); and "Funded Debt" shall mean,
                  as of any date, the total amount of liabilities (including the
                  advance contemplated by this paragraph) that would be
                  reflected on the consolidated balance sheet of Franchisee and
                  its parent and any and all subsidiaries and affiliates, if
                  any, in accordance with generally accepted accounting
                  principles applied on a consistent basis. All Advances for
                  Store acquisitions and/or conversions will be subject to the
                  approval of ColorTyme, but shall otherwise be at the
                  discretion of TFC.

                           (c) Franchisee Owner Buyouts. Advances for the buyout
                  of an ownership interest in a Franchisee, either by the
                  Franchisee or by one (1) or more other owners of interests in
                  the Franchisee, will be limited to the lesser of (i) four
                  hundred thousand dollars ($400,000.00); (ii) except



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                  in the case of Advances pursuant to a Term Loan, the amount of
                  the Franchisee's Credit Limit; or (iii) the amount of the
                  Franchisee's Advance Limit. Advances for Franchisee owner
                  buyouts will be limited to an aggregate balance outstanding at
                  any time of two million dollars ($2,000,000.00); such amount
                  is included in and is not in addition to the credit limit
                  established pursuant to Section 1.1. All Advances for
                  Franchisee owner buyouts will be subject to the approval of
                  ColorTyme, but shall otherwise be at the discretion of TFC.

                           (d) Working Capital. Advances for working capital
                  will be limited to the lesser of (i) the amount by which
                  ColorTyme's minimum working capital requirement exceeds the
                  Franchisee's working capital available from other sources;
                  (ii) sixty thousand dollars ($60,000.00); (iii) except in the
                  case of advances pursuant to a Term Loan, the amount of the
                  Franchisee's Credit Limit; or (iv) the amount of the
                  Franchisee's Advance Limit. Financing for working capital will
                  be made available only to Franchisees designated by ColorTyme
                  as having prior "rent-to-own" experience and approved by
                  ColorTyme for such financing in connection with the opening of
                  a Store, but shall otherwise be at the discretion of TFC.

         For purposes of this section, TFC may rely fully on the representations
         and/or agreements of the Franchisee with respect to the use of funds,
         with no obligation to independently verify such information. The use of
         any such funds by a Franchisee for any purpose not permitted by this
         section will not affect the obligations of ColorTyme or RAC under this
         Agreement.

         4. Governing Law. Section 6.15 of the Agreement is hereby amended by
deleting the existing Section 6.15 in its entirety and substituting in place
thereof the following:

                  6.15 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
         CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF RHODE ISLAND
         (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW).

         5. Termination of Certain Franchisee Lines of Credit. The parties
hereto recognize that the consent of the Franchisees that are presently
obligated to TFC pursuant to outstanding Receivables is necessary to effect the
change in interest rates contemplated by Section 2 of this Amendment. The
parties further recognize that in the event any Franchisee does not consent to
such change in writing, in a form that is reasonably required by TFC and
approved by ColorTyme, TFC may terminate the Franchisee's Line of Credit in
accordance with the terms of the instruments, documents and/or agreements
evidencing and governing such Line of Credit.

         6. Change of TFC's Address. The address of TFC for notices or other
communications given pursuant to Section 6.5 of the Agreement is hereby changed
to the following: Textron Financial Corporation, P.O. Box 2299, Little Rock,
Arkansas 72203.

         7. Effect of this Amendment. In the event of a conflict between the
terms of this Amendment and the terms of the Agreement, the provisions of this
Amendment shall prevail. Except as expressly set forth in this Amendment,
however, all provisions of the Agreement shall



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remain unchanged and shall continue in full force and effect. This Amendment is
hereby incorporated into the Agreement for all purposes.

         8. Effective Date. Except as otherwise provided herein, this Amendment
shall be effective as of December 31, 2002.

         IN WITNESS WHEREOF, TFC, ColorTyme and RAC have executed this Amendment
on this 24th day of March, 2003.

                                  COLORTYME, INC.
                                  5700 Tennyson Parkway, Suite 180
                                  Plano, Texas 75024

                                  By: /s/ Steven M. Arendt
                                     -------------------------------------------
                                  Name: Steven M. Arendt
                                       -----------------------------------------
                                  Title: President and Chief Executive Officer
                                        ----------------------------------------

                                  RENT-A-CENTER EAST, INC.
                                  5700 Tennyson Parkway, 3rd Floor
                                  Plano, Texas 75024

                                  By: /s/ Mitchell E. Fadel
                                     -------------------------------------------
                                  Name: Mitchell E. Fadel
                                       -----------------------------------------
                                  Title: President and Chief Operating Officer
                                        ----------------------------------------


                                  TEXTRON FINANCIAL CORPORATION
                                  112 West 3rd Street, 2nd Floor
                                  Little Rock, Arkansas 72201

                                  By:   /s/ Douglas K. Bland
                                     -------------------------------------------
                                  Name:     Douglas K. Bland
                                       -----------------------------------------
                                  Title:    Division President
                                        ----------------------------------------



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