Exhibit 10.23**EMPLOYMENT AGREEMENT**     THIS AGREEMENT is made as of the 1st day of October, 2005, by and between RENT-WAY,INC., a Pennsylvania corporation, with offices at One RentWay Place, Erie, Pennsylvania 16505 (the“Company”) and **Gregory L. Matheny**, an individual residing at 4274 Loop Road, Waterford,Pennsylvania 16441 (the “Employee”).     WHEREAS, the Company desires to employ the Employee and the Employee desires to accept suchemployment upon the terms and conditions contained in this Agreement, and     WHEREAS, the Company and the Employee desire to rescind all prior agreements regardingemployment between them and make this Agreement the sole contract governing the Company’semployment of the Employee.     NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein theCompany and the Employee agree as follows:     1. **Term**. Subject to the terms and conditions set forth in this Agreement, the Companyhereby agrees to employ the Employee, and the Employee hereby accepts such employment, for theperiod beginning on the date of this Agreement and continuing until 1) either party gives at leasttwo (2) weeks prior written notice to the other of the termination of this Agreement or 2) untilthis Agreement is otherwise terminated as provided herein.     If the Company terminates this Agreement for any reason other than the Employee’s deathpursuant to Section 5, the Employee’s disability pursuant to Section 6, or for cause pursuant toSection 9, the Employee shall have the right to receive continuing payments of bi-weekly basesalary (at the rate in effect at the time notice of termination is given) during the 12-monthperiod following the date on which termination is effective. Such continuing payments of basesalary shall be severance pay and shall not constitute a continuation of the Employee’s employmentfor any reason.     2. **Office; Duties**. During the Term, the Employee shall serve as Executive VicePresident/Chief Operating Officer. The President or his designee may at any time change the titleof the Employee.     Employee shall perform such duties and discharge such responsibilities as the President or hisdesignee shall from time to time reasonably direct. The Employee agrees to perform such duties anddischarge such responsibilities in a faithful manner and to the best of his ability. The Employeeagrees to devote his full business time and attention to the business and affairs of the Companyand to use his best efforts to promote the interests of the Company. The Employee further agreesthat he will engage in no outside business concerns or activities that conflict with his duties tothe Company, or are directly or indirectly competitive with the Company, without the Company’sprior written consent.     The President or his designee may from time to time assign to the Employee additional dutiesand responsibilities and delegate to other employees of the Company duties and responsibilitiesnormally discharged by the Employee. All such assignments and delegations of duties andresponsibilities shall be made by the President or his designee and may include a reduction of theEmployee’s duties and responsibilities or a reduction in the Employee’s position as reasonablydetermined by the President or his designee.     3. **Compensation**. During the Term, the Company agrees that:          3.1 The Employee shall receive an annual base salary of $215,000, payable in installments inaccordance with the regular payroll practices of the Company. The Company shall deduct

 
or withholdfrom payments of base salary, and from all other payments made to the Employee pursuant to thisAgreement, all amounts which may be required to be deducted or withheld under any applicable lawnow in effect or which may become effective during the term of this Agreement (including but notlimited to Social Security contributions and income tax withholdings). The Employee’s base salaryshall be reviewed annually by the President or his designee and may reasonably be increased ordecreased on the basis of individual and corporate performance in accordance with criteria andstandards established by the President or his designee.          3.2 Incentive Compensation; Bonuses. In addition to base salary, the Employee shallbe entitled to (i) participate in such incentive plans (including the right to defer income andbonuses) made available by the Company to its executives and key employees and (ii) receive suchadditional bonus or discretionary compensation payments as the President or his designee maydetermine from time to time. The Employee’s eligibility for incentive plan participation andadditional bonus or discretionary compensation payments shall be reviewed annually by the Presidentor his designee and shall be awarded on the basis of corporate performance and in accordance withcriteria and standards established in the sole discretion of the President or his designee. Thetarget amount of the bonus shall be 40% of the Employee’s base salary at the end of the fiscalperiod for which the bonus is calculated.          3.3 Expenses. During the Term, the Employee shall be entitled to receive promptreimbursement for all reasonable expenses incurred in connection with the performance of his dutiesin accordance with the policies and procedures of the Company as may be in effect from time totime.          3.4 Benefits. During the Term, the Employee shall be entitled to receive a package ofbenefits that includes all of the programs, plans and perquisites currently provided by the Companyto its employees, for so long as such programs, plans and perquisites are continued by the Companyand are available to employees of the Company.     4. **Stock Options**. Immediately following the execution of this Agreement, the Companyshall grant to the Employee incentive stock options to purchase 50,000 shares of the Company’sCommon Stock pursuant to and in accordance with a Stock Option Plan of the Company, as designatedby the Company. The options shall vest and become exercisable immediately but must be exercisedwithin a five-year period from the date of grant. Additionally, the shares received on exercise ofoptions will not be transferable except as follows: 16,666 shares on the third anniversary of thedate of grant, 16,667 shares on the fourth anniversary of the date of grant, and 16,667 shares onthe fifth anniversary of the date of the grant.     5. **Termination of Employment by Reason of Death**. If the Employee dies during theTerm, this Agreement shall terminate automatically as of the date of his death and the Companyshall pay to the Employee’s legal representatives such benefits determined in accordance with anythen existing Company-sponsored plans or programs providing benefits at death.     6. **Termination of Employment by Reason of Disability**. In the event that the Employeeshall sustain a disability which in the opinion of medical authority satisfactory to the Companywould substantially prevent him from rendering the services required under this Agreement for atotal of 180 days during any 360-day period, the Company shall have the right to terminate thisAgreement upon thirty (30) days’ prior written notice to the Employee.     7. **Termination After a Change in Control of the Company**.          (a) If within ninety (90) days following the occurrence of a Change of Control of the Company(as defined in Appendix A) the Employee elects to voluntarily terminate his employment with theCompany, the Employee shall be entitled to receive continuing payments of bi-weekly base salary (atthe rate in effect at the time notice of termination is given) for 12 months following the date onwhich termination is effective.
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          (b) Except as stated in (a) above, a Change of Control of the Company shall not affect theterms of this Agreement.     8. **Termination of Employment at Employee’s Election**. If the Employee elects toterminate this Agreement and the Employee gives two (2) weeks prior written notice of suchtermination, the Employee shall be entitled to receive his salary then in effect for the two (2)weeks notice period regardless of whether the Company desires the Employee to continue hisemployment during that period.     9. **Termination of Employment for Cause**. The Company shall have the right to terminatethe Employee’s employment immediately in the event the Employee shall do or cause to be done anyact that constitutes “cause” (as hereinafter defined) for termination. For purposes of thisAgreement, “cause” shall be deemed to mean a breach of his obligations under this Agreement (anybreach of Section 10, 11 or 12 hereof being an example of such a breach), gross negligence, willfulmisconduct, insubordination, dishonesty to the Company, engaging in any conduct which could havethe effect of causing the termination or suspension of any license or permit which the Companyholds, conviction of any felony, or excessive absenteeism not related to disability. In addition,“cause” shall include the Employee’s failure, as reasonably determined by the President, toadequately perform his job responsibilities or to meet the performance goals and objectivesestablished for him by the Company. Should the Employee’s employment be terminated by the Companyfor cause, the Company’s only obligation shall be to pay the Employee his base salary through thedate of termination. Nothing contained in this Section 8 shall in any way waive, restrict orprejudice the Company’s rights and remedies in equity and at law against the Employee with respectto the matter for which the Employee’s employment under this Agreement is terminated for cause.     10. **Confidentiality**.          10.1 During the course of his employment with the Company, the Employee has had and will haveaccess to and will gain knowledge with respect to all aspects of the business of the Company,including financial information; business and marketing practices and procedures; informationconcerning employees, customers, suppliers; and other valuable and proprietary information relatingto the business of Company (“Confidential Information”). The parties agree that certain covenantsby the Employee are essential to the growth and stability of the business of the Company. Amongthese covenants are the Employee’s promises not to make unauthorized disclosures of theConfidential Information nor to use the Confidential Information regardless of whether theEmployee’s employment with the Company has terminated. Accordingly, Employee agrees that, exceptas required by his duties under this Agreement, he shall not use nor disclose to anyone at anytimeduring or after the Term any Confidential Information obtained by him in the course of hisemployment with the Company. The Employee agrees to enter into any further agreement regardingconfidentiality that the Company may request. The Employee shall use his best efforts to preventthe removal of any Confidential Information from the premises of the Company, except as required inhis normal course of employment by the Company. The Employee shall use his best efforts to causeall persons or entities to whom any Confidential Information shall be disclosed by him hereunder toobserve the terms and conditions set forth herein as though each such person or entity was boundhereby.          10.2 Employee agrees to hold as the Company’s property all memoranda, books, papers, letters,customer lists, processes, computer software, records, financial information, policy and proceduremanuals, training and recruiting procedures and other data, and all copies thereof andtherefrom in any way relating to the Company’s business and affairs, whether made by him orotherwise coming into his possession, and on termination of his employment, or on demand of theCompany at any time, to deliver the same to the Company.     11. **Non-Competition; Non-Solicitation**.          11.1 During the Term of this Agreement and for a period continuing for one (1) year after thedate of its termination, the Employee agrees that he shall not directly or indirectly, for his own
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account or as agent, employee, officer, director, trustee, consultant or shareholder of anycorporation or other entity [except for a two percent (2%) interest or less in any publicly tradedcorporation or other entity] engage or attempt to engage anywhere in North America in any businessactivity which is the same as, substantially similar to or directly competitive with the businessof the Company, or any subsidiary of the Company, as now or in the future conducted by the Company.          11.2 During the Term of this Agreement and for a period continuing for one (1) year after thedate of its termination, the Employee agrees that he shall not, directly or indirectly, for his ownaccount or as agent, employee, officer, director, trustee, consultant or shareholder of anycorporation or other entity [except for a two percent (2%) interest or less in any publicly tradedcorporation or other entity] (i) employ or solicit the employment of any employee of the Company,any employee of a subsidiary of the Company, or any former employee of the Company whose employmentwith the Company terminated within the preceding six (6) months or (ii) induce or attempt to induceany employee of the Company, or any employee of a subsidiary of the Company, to terminate his orher employment with the Company or any subsidiary of the Company.          11.3 The Employee acknowledges and agrees that the foregoing territorial and time limitationsand restrictive covenants are reasonable and properly required for the adequate protection of thebusiness and affairs of the Company. In the event any such territorial or time limitation is foundto be unreasonable by a court of competent jurisdiction, the Employee agrees and submits to thereduction of either said territorial or time limitation (or both) to such an area or period as thecourt may determine to be reasonable.     12. **Rights to Discoveries**. The Employee agrees that all ideas, inventions, trademarksand other techniques, procedures, developments or improvements conceived, developed or acquired bythe Employee, whether or not during working hours, at the premises of the Company or elsewhere,alone or with others, that are within the scope of the Company’s business operations or that relateto any work or projects of the Company shall be the sole and exclusive property of the Company.The Employee agrees to disclose promptly and fully to the Company all such ideas, inventions,trademarks or other techniques, procedures, developments or improvements and, at the request of theCompany, the Employee shall submit to the Company a full written report thereof regardless ofwhether the request for a written report is made after the termination of this Agreement. TheEmployee agrees that during the Term and thereafter, upon the request of the Company and at itsexpense, he shall execute and deliver any and all applications, assignments and other instrumentswhich the Company shall deem necessary or advisable to transfer to and vest in the Company theEmployee’s entire right, title and interest in and to all such ideas, inventions, trademarks orother techniques, procedures, developments or improvements and shall assist the Company in applyingfor and obtaining patent, trademark or copyright protection for any such protectible ideas,inventions, trademarks and other techniques, procedures, developments and improvements.     13. **Notices**. All notices and other communications given pursuant to this Agreementshall be deemed to have been properly given or delivered if mailed, by certified mail, postageprepaid, addressed to the appropriate party, at the address for such party set forth at thebeginning of this Agreement. Any party may from time to time designate by written notice givenpursuant to this Section 13 any other address or party to which any such notice or communication orcopies thereof shall be sent.     14. **Equitable Relief**. The Employee acknowledges that the Company will suffer damagesincapable of ascertainment in the event that any of the provisions of Section 10, 11 or 12 hereofare breached and that the Company will be irreparably damaged in the event that the provisions ofSection 10, 11 or 12 are not enforced. Therefore, should any dispute arise with respect to thebreach or threatened breach of any such Sections, the Employee agrees and consents that in additionto any and all other remedies available to the Company an injunction or restraining order or otherequitable relief may be issued or ordered by a court of competent jurisdiction restraining anybreach or threatened breach of such Sections. The Employee agrees not to urge in any such actionthat an adequate remedy exists at law. All expenses, including, without limitation, attorney’sfees and expenses incurred in connection with
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any legal proceeding arising as a result of a breachor threatened breach of Section 10, 11 or 12 of this Agreement shall be borne by the losing partyto the fullest extent permitted by law and the losing party hereby agrees to indemnify and hold theother party harmless from and against all such expenses.     15. **Arbitration of Disputes**. Except for an alleged violation of Section 10, 11or 12 of this Agreement, the Employee and the Company waive any right to a court (includingjury) proceeding and instead agree to submit any dispute over the Employee’s employment withthe Company or the application, interpretation, validity or any other aspect of thisAgreement to final and binding arbitration consistent with the Company’s alternative disputeresolution program or, if none, then consistent with the application of the FederalArbitration Act and the rules for arbitration of employment disputes of the AmericanArbitration Association (“AAA”) before a single arbitrator. Only true neutrals will beeligible for consideration as arbitrators and under no circumstances will AAA furnish thenames of individuals who represent employees, unions or companies.     16. **Successors**. The Company will require any successor to all or substantially all ofthe business and/or assets of the Company (whether direct or indirect by purchase, merger,consolidation or otherwise) to expressly assume and agree to perform this Agreement in the samemanner and to the same extent that the Company would be required to perform if no such successionhad taken place. As used in this Agreement, the “Company” shall mean both Rent-Way, Inc. and anysuccessor to its business and/or assets (by merger, purchase or otherwise).     17. **Miscellaneous**. This Agreement shall be governed by the internal domestic laws ofthe Commonwealth of Pennsylvania without reference to conflict of laws principles. The Employeeconsents to jurisdiction in Pennsylvania and venue in Erie County for purposes of all claimsarising under this Agreement. All headings and subheadings are for convenience only and are not ofsubstantive effect. This Agreement constitutes the entire agreement between the parties heretowith respect to the subject matter hereof and supersedes all prior agreements, negotiations,understandings and writings (or any part thereof) whether oral or written between the partieshereto relating to the subject matter hereof, all of which are hereby terminated and canceled.There are no oral agreements in connection with this Agreement. Neither this Agreement nor anyprovision of this Agreement may be waived, modified or amended orally or by any course of conductbut only by an agreement in writing duly executed by both of the parties hereto. If any section,portion, subsection or subportion of this Agreement shall be determined to be unenforceable orinvalid, then such section, portion, subsection or subportion shall be modified in the letter andspirit of this Agreement to the extent permitted by applicable law so as to be rendered valid andany such determination shall not affect the remainder of this Agreement, which shall be and remainbinding and effective as against the parties hereto.     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement to be effective as ofthe date first above written.           COMPANY:         EMPLOYEE:   RENT-WAY, INC.           By:           Gregory L. Matheny                                        Date   William S. Short, President DateExecutive Vice President/