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

SCHEDULE 14A
(Rule 14a-101)

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934

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PROXY STATEMENT FOR
AND
NOTICE OF
2007 ANNUAL MEETING OF STOCKHOLDERS

Annual Meeting:		May 19, 200615, 2007 9:30 a.m. local time
Location:		Grand Hyatt DFW HotelRent-A-Center, Inc. Dallas/ Fort Worth International Airport,5501 Headquarters Drive Plano, Texas 75024
Record Date:		Close of business on March 24, 2006.19, 2007. If you were a stockholder of record at the close of business on March 24, 2006,19, 2007, you may vote at the meeting.
Number of Votes:		Holders of our Common Stock are entitled to one vote for each share of Common Stock they owned on March 24, 2006.19, 2007.
Agenda:		1.		To elect twothree Class IIII directors;
		2.		To approveratify the Rent-A-Center, Inc. 2006 Long-Term Incentive Plan;Audit Committee’s appointment of Grant Thornton, LLP, registered independent accountants, as our independent auditors for the fiscal year ended December 31, 2007; and
		3.		To transact any other proper business.
Proxies:		Unless you tell us on the proxy card to vote differently, we will vote signed returned proxies (1) “FOR” the Board’s nominees for Class IIII director and (2) “FOR” the approvalratification of the Rent-A-Center, Inc. 2006 Long-Term Incentive Plan.audit committee’s appointment of Grant Thornton, LLP, registered independent accountants, as our independent auditors for the fiscal year ended December 31, 2007. The proxy holders will use their discretion on other matters. If a nominee cannot or will not serve as a director, the proxy holders will vote for a person whom they believe will carry on our present policies.
Proxies Solicited By:		We have retained Mellon Investor Services, L.L.C. (“Mellon”) to aid in the solicitationThe Board of proxies. It is estimated that the cost of these services will be approximately $9,500 plus expenses. We will bear the entire cost of soliciting proxies in the accompanying form. In addition to the solicitation of proxies by mail, proxies may also be solicited by telephone, telegram, electronic mail or personal interview by officers and regular employees of Mellon and us. We will reimburse brokers or other persons holding stock in their names or in the names of their nominees for their reasonable expenses incurred in forwarding proxy materials to beneficial owners of stock.Directors.
First Mailing Date:		This proxy statement is dated March 31, 2006.April 9, 2007. We are first mailing this proxy statement on or about April 17, 2006.13, 2007.
Revoking Your Proxy:		You may revoke your proxy before it is voted at the meeting. To revoke, follow the procedures listed on page 3243 under “Voting Procedures/Revoking Your Proxy — How You May Revoke Your Proxy.”

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PROPOSAL TWO:

RATIFICATION OF THE SELECTION OF INDEPENDENT

APPROVAL OF THE RENT-A-CENTER, INC.REGISTERED PUBLIC ACCOUNTING FIRM

2006 LONG-TERM INCENTIVE PLAN

Overview:		The stockholders are being asked to approve the Rent-A-Center, Inc. 2006 Long-Term Incentive Plan (the “2006 Plan”). On March 24, 2006, upon the recommendation of the Compensation Committee, the Board adopted, subject to stockholder approval, the 2006 Plan and has directed that it be submitted for the approval of the stockholders. The 2006 Plan will become effective on the date it is approved by our stockholders. Upon approval of the 2006 Plan, our existing Long-Term Incentive Plan will terminate and no additional awards will be granted under that plan.
		The following description of the 2006 Plan is only a summary of certain provisions of the 2006 Plan and does not contain all of the terms and conditions of the 2006 Plan. This summary is qualified in its entirety by the full text of the 2006 Plan, which is attached to this Proxy Statement as Appendix “B.”
Board Recommendation:		Our Board, upon the recommendation of the Compensation Committee, has approved and adopted the 2006 Plan, subject to the approval by our stockholders. We urge you to vote “FOR” the approval of the 2006 Plan.
Purpose:		The purpose of the 2006 Plan is to foster our ability to attract, motivate and retain key personnel and enhance stockholder value through the use of certain equity and cash incentive compensation opportunities.
Eligibility:		Any of our present or future directors, officers, employees, consultants and other personnel are eligible to participate in the 2006 Plan. Actual selection of any eligible individual to participate in the 2006 Plan is within the sole discretion of the Compensation Committee. If awards are made under the 2006 Plan as they were under the Long-Term Incentive Plan, the eligible individuals would consist of eight members of the Board, 29 senior officers and approximately 3,200 employees that are not senior officers.
Term:		Upon approval by the stockholders, the 2006 Plan will become effective. Assuming the 2006 Plan is approved at the annual stockholder meeting, unless terminated sooner by the Board, the 2006 plan will terminate on May 19, 2016. The rights of any person with respect to an award made under the 2006 Plan that is outstanding at the time of its termination will not be affected solely by reason of the termination of the 2006 Plan.
Administration:		The 2006 Plan will be administered by the Compensation Committee. The Compensation Committee will have the full power and authority to:
		• select the persons to whom awards will be made;
		• prescribe the terms and conditions of each award and make amendments thereto;
		• construe, interpret and apply the provisions of the 2006 Plan and of any agreement or other document governing the terms of an award made under the 2006 Plan; and
		• make any an all determinations and take any and all other actions as it deems necessary or desirable to carry out the terms of the 2006 Plan.
		The Board will have the sole responsibility and authority for matters relating to the grant and administration of awards to non-employee directors.

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Limitations on Plan Awards:		If approved, the 2006 Plan would authorize us to issue a total of 7,000,000 shares of Common Stock, of which no more than 3,500,000 shares may be issued in the form of restricted stock, deferred stock or similar forms of stock award which have value without regard to future appreciation in value of or dividends declared on the underlying shares of stock. In applying these limitations, the following shares will be deemed not to have been issued: (1) shares covered by the unexercised portion of an option that terminates, expires, or is cancelled or settled in cash, and (2) shares that are forfeited or subject to awards that are forfeited, canceled, terminated or settled in cash. In any calendar year, (1) no employee may receive options and stock appreciation rights for more than 600,000 shares of Common Stock; (2) no employee may earn more than 600,000 shares of Common Stock pursuant to performance-based equity awards under the 2006 Plan (other than options and stock appreciation rights), increased by the unused limit, if any, from prior calendar years; and (3) no employee may earn more than $3,000,000 pursuant to performance-based cash awards under the 2006 Plan, increased by the unused limit, if any, from prior calendar years.
Stock Options:		The 2006 Plan permits the granting of stock options at such times and upon such vesting and other conditions as determined by the Compensation Committee. The purchase price per share of Common Stock covered by an option granted under the 2006 Plan may not be less than the fair market value per share on the grant date. The exercise price under an option which is intended to qualify as an “incentive stock option” (within the meaning of Section 422 of the Internal Revenue Code of 1986 (the “Code”)) granted to an employee who is a 10% stockholder within the meaning of Section 422(b)(6) of the Code, may not be less than 110% of the fair market value per share on the date the option is granted. Unless approved by our stockholders, the Compensation Committee may not reduce the exercise price for shares covered by an outstanding option granted under the 2006 Plan, whether directly or in any manner which constitutes a “repricing” under applicable stock exchange rules or financial accounting principles.
		Subject to earlier termination according to its terms, an option granted under the 2006 Plan will expire on the tenth anniversary of its grant (or the fifth anniversary of its grant in the case of an option which is intended to qualify as an “incentive stock option” granted to an employee who is a 10% stockholder).
		No option granted under the 2006 Plan shall be assignable or transferable except upon the optionee’s death to a beneficiary designated in a manner so prescribed or approved by the Compensation Committee or, if no designated beneficiary shall survive the optionee, pursuant to the optionee’s will or by the laws of descent and distribution. During an optionee’s lifetime, options may be exercised only by the optionee or the optionee’s guardian or legal representative. Notwithstanding the foregoing, the Compensation Committee may permit the inter vivos transfer of an optionee’s options (other than options designated as “incentive stock options”) by gift to any “family member,” on such terms and conditions as the Compensation Committee may deem appropriate.
		An option granted under the 2006 Plan may be exercised by transmitting to the Secretary (or such other person designated by the Compensation Committee) a written notice identifying the option being exercised and specifying the number of shares being purchased, together with payment of the exercise price and the amount of the applicable tax withholding obligations (unless other arrangements are made for the payment of such exercise and/or the satisfaction of such withholding obligations). The Compensation Committee may permit the exercise and withholding obligation to be paid in whole or in part in cash or by check, by means of a cashless exercise procedure to the extent permitted by law, by the surrender of previously-owned shares of Common Stock (to the extent of the fair market value thereof) or, subject to applicable law, by any other form of consideration deemed appropriate.

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		The maximum number of shares of Common Stock which may be issued under the 2006 Plan covering options granted as “incentive stock options” is 500,000.
Stock Awards:		The 2006 Plan permits the granting of restricted stock, deferred stock, stock units, stock bonus and other stock awards at such times and upon such vesting and other conditions and restrictions as determined by the Compensation Committee.
		Unless otherwise determined by the Compensation Committee, (1) the holder of a stock award will not be entitled to receive dividend payments (or in the case of an award of stock units, dividend equivalent payments) with respect to the shares covered by the award, and (2) the holder of shares of restricted stock may exercise voting rights pertaining to such shares. Under the 2006 Plan, the Compensation Committee may impose vesting and deferral conditions on the payment of dividends, corresponding to the vesting and deferral conditions applicable to the corresponding stock award.
		Except as permitted by the Compensation Committee in connection with transfers at death or pursuant to inter vivos gifts, no outstanding stock award and no shares of stock covered by an outstanding stock award may be sold, assigned, transferred, disposed of, pledged or otherwise hypothecated other than us in accordance with the terms of the award or the 2006 Plan.
Other Equity Awards:		Under the 2006 Plan, the Compensation Committee may grant stock appreciation rights, dividend equivalent payment rights, phantom shares, phantom stock units, bonus shares and other forms of equity-based awards to eligible persons, subject to such terms and conditions as it may establish; provided, however, that no dividend or dividend equivalent payment rights shall be attributable to awards of stock appreciation rights or stock options. The base price for a stock appreciation right granted under the 2006 Plan may not be less than the fair market value per share of stock covered by the award at the time it is granted. Unless sooner termination in accordance with its terms, a stock appreciation right will automatically expire on the tenth anniversary of its grant date. Such awards may entail the transfer of shares of Common Stock to a participant or the payment in cash or other property determined with reference to shares of Common Stock.
Cash Awards:		Under the 2006 Plan, the Compensation Committee may grant awards in cash with the amount of eventual payment subject to future service and such other restrictions and conditions as may be established by the Compensation Committee and set forth in the underlying agreement, including, but not limited to:
		• continuous service with us,
		• achievement of specific business objectives,
		• increases in specified indices,
		• attaining specified growth rates, and
		• other measures of performance.

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Performance-Based Equity and Cash Awards:		The Compensation Committee may condition the grant, exercise, vesting or settlement of equity-based awards as well as the grant, vesting or payment of annual or long-term cash incentive awards made under the 2006 Plan on the achievement of specified performance goals over any period specified by the Compensation Committee. Any such performance goal must be (1) objective, (2) prescribed in writing by the Compensation Committee before the applicable performance period or at such later date when fulfillment is substantially uncertain not later than 90 days after the commencement of the performance period and in any event before completion of 25% of the performance period, and (3) based on any one or more of the following business criteria (which may be applied to an individual, a subsidiary, a business unit or division, or us and any one or more of our subsidiaries as a whole, as determined by the Committee):
		• total revenue or any key component thereof;
		• operating income, pre-tax or after-tax income from continuing operations; earnings before interest, taxes and amortization (i.e. EBITA); earnings before interest, taxes, depreciation and amortization (i.e., EBITDA); or net income;
		• cash flow (including, without limitation, free cash flow, cash flow return on investment (discounted or otherwise), net cash provided by operations or cash flow in excess of cost of capital);
		• earnings per share or earnings per share from continuing operations (basic or diluted);
		• return on capital employed, return on invested capital, return on assets or net assets;
		• after-tax return on stockholders’ equity;
		• economic value created;
		• operating margins or operating expenses;
		• value of the Common Stock or total return to stockholders;
		• value of an investment in the Common Stock assuming the reinvestment of dividends;
		• strategic business criteria, consisting of one or more objectives based on meeting specified market penetration goals, geographic business expansion goals, cost targets, management of employment practices and employee benefits, or supervision of litigation or information technology goals, or goals relating to acquisitions of divestitures of subsidiaries, affiliates or joint ventures; and/or
		• a combination of any or all of the foregoing criteria.
		At the expiration of the applicable performance period, the Compensation Committee shall determine the extent to which the relevant performance goals are achieved and the extent to which each performance-based award has been earned. The Compensation Committee may not exercise its discretion to increase the amount or value of such an award that would otherwise be payable in accordance with its terms.
Adjustments:		In the event of a split-up or consolidation of shares or any like capital adjustment, the payment of any stock dividend, and/or to reflect a change in the character or class of shares covered by the 2006 Plan arising from a readjustment or recapitalization of our capital stock, the share authorization limits under the 2006 Plan will be automatically adjusted proportionately, and the shares then subject to each award will automatically be adjusted to reflect any such resulting increase or decrease in the number of issued shares of Common Stock without any change in the aggregate purchase price for such award.

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Cash, Stock or Other Property for Stock:		Under the 2006 Plan, in the event of a:
		• merger (other than a merger of us in which the holders of the Common Stock immediately prior to the merger have the same proportionate ownership of common stock in the surviving corporation immediately after the merger),
		• consolidation,
		• acquisition or disposition of property or stock,
		• separation,
		• reorganization (other than a reincorporation or the creation of a holding company),
		• liquidation of us, or
		• any other similar transaction or event so designated by the Board as a result of which our stockholders receive cash, stock or other property in exchange for or in connection with their shares of Common Stock, (each an “exchange transaction”),
		all optionees shall be permitted to exercise their outstanding options immediately prior to such exchange transaction, and any outstanding options not exercised before the exchange transaction shall terminate. However, if, as part of an exchange transaction, our stockholders receive capital stock of another corporation (“exchange stock”) in exchange for their shares of Common Stock, and if the Board so directs, then all outstanding options shall be converted in whole or in part into options to purchase shares of exchange stock. The Board may accelerate vesting of non-vested stock awards and other awards, provide for cash settlement of options and/or make such other adjustments to the terms of any outstanding award as it deems appropriate in the context of an exchange transaction, taking into account, as applicable, the manner in which outstanding options are being treated.
Amendment and Termination:		The Board may at any time amend the 2006 Plan, or the terms of any agreement or award made under the 2006 Plan, or terminate the 2006 Plan, but such amendment or termination shall not adversely affect any outstanding award without the consent of the affected participant. In addition, the Board may not, without the prior approval of the stockholders, make any amendment which would (1) increase the aggregate number of shares of Common Stock issuable under the 2006 Plan, (2) increase the maximum number of shares with respect to which options, stock appreciation rights or other equity awards may be granted to any employee in any calendar year, or (3) modify the class of persons eligible to receive awards. The Compensation Committee may amend the terms of any agreement or award made under the 2006 Plan at any time and from time to time, provided, however, that any amendment which would adversely affect a holder’s rights under an outstanding award may not be made without his or her consent.
Federal Income Tax Effects:		The Federal income tax consequences of awards under the 2006 Plan are summarized below.
		The grant of an option or stock appreciation right, or SAR, is not a taxable event for the participant or us. In general, at the time an option is exercised, a participant will recognize ordinary income equal to the difference between the exercise price and the fair market value of the shares. At the time an SAR is exercised, a participant will recognize ordinary income equal to the fair market value of the shares received. We will be entitled to claim a deduction equal to the amount of ordinary income recognized by a participant upon the exercise of an option or SAR. Upon a later sale of the shares, a participant will realize capital gain or loss equal to the difference between the selling price and the fair market value of the shares on the date the option or SAR is exercised.

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		We may grant options under the 2006 Plan that qualify for special tax treatment which is different than what is described above. The IRS calls these options “incentive stock options,” or ISOs. No taxable income is recognized when a participant exercises an ISO, although alternative minimum tax may apply. If shares acquired upon the exercise of an ISO are held by a participant for at least one year from the date the ISO is exercised and two years from the date the ISO is granted, any gain or loss realized on a sale of the shares will be treated as long-term capital gain or loss. However, if a participant sells the shares before the minimum holding periods are met, the gain realized on the sale will be taxable as ordinary income to the extent of the difference between the exercise price paid for the shares and the fair market value of the shares on the date the ISO was exercised. The balance of the gain, if any, will be treated as capital gain. We will be entitled to claim a deduction equal to any ordinary income recognized by a participant upon the sale of shares acquired by the exercise of an ISO.
		In general, participants will recognize ordinary income with respect to other types of awards under the 2006 Plan at the time those awards are settled with vested shares or cash, equal to the amount of cash or the then fair market value of the shares. Thus, for example, if we grant a restricted stock award to a participant under the 2006 Plan, then, unless the participant makes a special tax election to recognize income as of the date of the award, the participant will recognize ordinary income equal to the value of the shares as and when they become vested under the terms of the award. Similarly, if we make a deferred stock award, a participant will recognize ordinary income equal to the fair market value of the shares as and when the shares are delivered to the participant in accordance with the terms of the award. We will be entitled to claim a tax deduction equal to the ordinary income recognized by a participant.
		Compensation that qualifies as “performance-based” compensation is excluded from the $1 million deductibility cap of Code Section 162(m), and therefore remains fully deductible by the employer. We believe that compensation attributable to options and SARs granted under the 2006 Plan, as well as compensation under certain other awards which is conditioned upon achievement of performance goals set forth in the 2006 Plan, will be able to qualify as “performance-based” compensation and, as such, would not be subject to the deduction limitations of Section 162(m). A number of requirements must be met in order for particular compensation to so qualify, however, so there can be no assurance that such compensation under the 2006 Plan will be fully deductible under all circumstances. In addition, compensation earned under certain types of awards permitted by the 2006 Plan, including, for example, restricted stock awards and deferred stock awards that are not subject to performance-based vesting conditions, generally will not qualify for the 162(m) “performance based” compensation exemption and will be taken into account in applying the annual deduction limitation.
		This summary provides only a general description of the application of Federal income tax laws to certain awards under the 2006 Plan. This discussion is intended for the information of stockholders considering how to vote at the annual meeting and not as tax guidance to participants in the 2006 Plan. The summary does not address the effects of gift, estate, excise and other federal taxes or taxes imposed under state, local, or foreign tax laws.

WE RECOMMEND THAT YOU VOTE “FOR” THE APPROVAL OF THE

RENT-A-CENTER, INC. 2006 LONG-TERM INCENTIVE PLAN.

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EXECUTIVE OFFICERS

The Board appoints our executive officers at the first Board meeting following our annual stockholders meeting and updates the executive officer positions as needed throughout the year. Each executive officer serves at the behest of the Board and until their successors are appointed, or until the earlier of their death, resignation or removal.

The following table sets forth certain information with respect to our executive officers as of March 24, 2006:

Name		Age				Position
Mark E. Speese			48			Chairman of the Board of Directors and Chief Executive Officer
Mitchell E. Fadel			48			President and Chief Operating Officer
Robert D. Davis			34			Senior Vice President — Finance, Chief Financial Officer and Treasurer
Christopher A. Korst			46			Senior Vice President — General Counsel and Secretary
Robert F. Bloom			54			President and Chief Executive Officer of ColorTyme, Inc.

Mark E. Speese		Mr. Speese has served as the Chairman of our Board and Chief Executive Officer since October 2001 and has served as one of our directors since 1990. Mr. Speese previously served as our Vice Chairman from September 1999 until March 2001. From 1990 until April 1999, Mr. Speese served as our President. Mr. Speese also served as our Chief Operating Officer from November 1994 until March 1999.
Mitchell E. Fadel		Mr. Fadel has served as our President since July 2000, as our Chief Operating Officer since December 2002 and as a director since December 2000. From November 1992 until July 2000, Mr. Fadel served as President and Chief Executive Officer of ColorTyme. We acquired ColorTyme in May 1996.
Robert D. Davis		Mr. Davis has served as our Senior Vice President — Finance since September 1999, as our Chief Financial Officer since March 1999 and as our Treasurer since January 1997. From September 1998 until September 1999, Mr. Davis served as our Vice President — Finance and Treasurer. Mr. Davis is a licensed certified public accountant in the State of Texas.
Christopher A. Korst		Mr. Korst has served as our Senior Vice President — General Counsel since May 2001 and as Secretary since September 2004. From January 2000 until May 2001, Mr. Korst owned and operated AdvantEdge Quality Cars, which he acquired in a management buyout.
Robert F. Bloom		Mr. Bloom joined ColorTyme in June 2004 and was appointed President and Chief Executive Officer of ColorTyme by the Board in September 2004. Mr. Bloom was employed by EZCORP, Inc., a leading operator of pawn shops, from June 2000 until May 2004, serving in various capacities, including as Senior Vice President of Operations since October 2003. From January 1999 to April 2000, Mr. Bloom served as Regional Vice President of Franchise Operations for the Family Steakhouse division of Metromedia Restaurant Group.

Code of Ethics:		Our Board has adopted a Code of Business Conduct and Ethics governing all of our employees, including our Chief Executive Officer, Chief Financial Officer, our principal accounting officer and controller. A copy of this Code of Business Conduct and Ethics is published on our website at www.rentacenter.com. We intend to make all required disclosures concerning any amendments to, or waivers from, the Code of Business Conduct and Ethics on our website.

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COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

The Committee:		The Compensation Committee is appointed annually by the Board to discharge the Board’s responsibilities with respect to all forms of compensation paid to our Chief Executive Officer and other senior executives. The Committee also evaluates the performance of our senior executives, administers our equity incentive plans and considers any related matters for us. The Committee is composed of three independent directors,Messrs. Lentell (Chairman), Armey and Berg.
Overall Philosophy and Objectives:		The objectives of our executive compensation program are to: • reward performance that increases the value of our stock; • attract, retain and motivate senior executives with competitive compensation opportunities;
		• build and encourage ownership of our shares;
		• balance short-term and long-term strategic goals; and
		• address the concerns of our stockholders, employees, the financial community and the general public.
		During 2005, the Committee retained an executive compensation consulting firm to review our executive compensation practices and to provide the Committee independent advice with respect to our executive compensation program, including providing independent competitive compensation data, making recommendations to the Committee as to the forms of and overall compensation paid to our senior executives and assisting in the development and review of the 2006 Plan.
		As in prior years, the Committee’s judgments regarding executive compensation for 2005 were based primarily on the Committee’s assessment of each executive officer’s performance, taking into account the input received by the Committee from the Chief Executive Officer. The Committee relied upon its judgment and not upon rigid guidelines, formulas or short-term changes in our stock price in determining the amount and mix of compensation elements for each executive officer. Key factors affecting the Committee’s judgments included our financial performance, the individual contribution of each senior executive, the input received from the Chief Executive Officer, compensation practices of comparable companies and general economic factors. While the Committee does consider our stock price performance, it has not been the primary consideration in determining annual compensation because the price of our common stock is subject to a variety of factors outside our control. The Committee also considered the information compiled by the executive compensation consulting firm regarding the compensation levels (including long-term incentives) of corporate executives in companies in our competitive business group and the competitive market in which we compete for executive talent.
		In assessing compensation levels for our senior executives for 2006, the Committee targeted total compensation to fall in the lower 25% quartile relative to pay practices of comparable publicly traded companies in the retail industry.
Senior Executive Compensation:		Our executive compensation program for our senior executives (other than our Chief Executive Officer) for 2005 was comprised of the following forms of compensation: Salary.Senior executives’ salaries are determined by evaluating our financial performance, the most recent comparative peer data, the senior executive’s role and responsibilities and their historical performance. Individual salaries are reviewed annually and salary increases are based on the senior executive’s performance and compensation of similarly situated individuals at comparable companies. The Committee reviews statistical compensation studies of comparable companies in similar industry, size, and region to determine base salaries for our senior executives. Base salaries are targeted at the lower 25% quartile relative to pay practices of comparable publicly traded companies in the retail industry.

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		Cash Bonus.The Committee approved a cash bonus program for the 2005 fiscal year in which our senior executives, other than our Chief Executive Officer, were eligible to participate. Bonuses were capped at a certain percentage of the eligible participant’s base salary, with the percentage depending on the individual’s position with us. Of the maximum cash bonus amount an eligible participant could earn, generally 40% was contingent on the achievement by us of a target amount of after-tax profit, and the remaining 60% was subject to the achievement of individual goals and objectives, which were set at the beginning of the fiscal year. During 2005, we did not achieve the targeted after-tax profit, and as a result, none of our executives received that portion of their cash bonus under the 2005 cash bonus program.
		Long Term Incentives.In addition to base salary and the cash bonus program, the Committee from time to time may consider long-term stock incentives to senior executives. Any grants of long-term incentive awards to senior executives are discretionary and determined by the Committee using its business judgment. The Committee believes that grants of stock options provide incentive for the creation of stockholder value since the full benefit of the grant to each senior executive can only be realized with an appreciation in the price of our common stock. Stock options granted to our senior executives have been granted only pursuant to our Long-Term Incentive Plan. Other than awards to newly-hired or promoted senior executives, no stock options were granted to any of our senior executives, including our Chief Executive Officer, in 2005.
		As part of the Committee’s review of our executive compensation program, the Committee determined that a greater emphasis should be placed on ‘at risk‘ opportunities for compensation through a performance-based cash bonus (with respect to our Chief Executive Officer) and performance-based restricted stock unit awards (for our other senior executives). Accordingly, it was recommended and we determined it appropriate that we revisit our long-term incentive program and grant new forms of long-term incentive awards to our senior executives for 2006. In January 2006, we awarded, pursuant to our existing Long-Term Incentive Plan, long-term incentive equity awards to our senior executives (other than our Chief Executive Officer as discussed below). Each award was comprised of three tranches: (1) 50% of which was issued in stock options, which vest ratably over a four year period, (2) 25% of which was issued in restricted stock units, which will vest upon the senior executive’s completion of three years of continuous service, and (3) 25% of which was issued in restricted stock units subject to a performance-based vesting requirement.
		Perquisites.Our executive compensation programs have been relatively free of perquisites. To reinforce this position, the Board adopted a formal policy in 2002 regarding the personal use of our company aircraft by certain of our executive officers. Under this policy, our corporate aircraft is available for non-business use by our Chief Executive Officer, President, Chief Operating Officer, Chief Financial Officer and Executive Vice Presidents. Use of the corporate aircraft by these executives for reasonable non-business use is subject to availability and must be pre-approved by the Chairman of the Audit Committee. Upon approval by the Chairman of the Audit Committee, the requesting executive must pay to us, in advance, 110% of the estimated total cost of the requested use of the corporate aircraft. If the actual cost for the non-business use of the corporate aircraft exceeds the advance deposit made by the requesting executive, the additional amount is deemed compensation to the requesting executive and reflected on his W-2 earnings statement for the year.
		In addition, our senior executives generally participate in benefit plans generally available for all of our employees. The Committee’s charter requires the approval of the Committee of all severance arrangements, change in control arrangements, perquisites and other personal benefits.
		Retirement Benefits.Our senior executives are eligible to participate in our 401(k) plan. We may make discretionary matching cash contributions to the 401(k) plan in the amount of 50% of the senior executives’ contributions, up to an amount not to exceed 4% of the senior executives’ compensation (subject to highly compensated employee limits).

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Chief Executive Officer Compensation:		2005 Compensation.The compensation paid to Mr. Speese, our Chief Executive Officer, during 2005 was generally comprised of salary and a cash bonus. Salary.In determining the base salary for Mr. Speese for the 2005 fiscal year, the Committee considered our performance in 2004, and the level of compensation paid to the highest paid executive at comparable publicly owned companies. Based on these factors, the Committee established Mr. Speese’s 2005 base salary effective January 1, 2005, at $685,000, which was a 5.4% increase from his 2004 salary level. This placed Mr. Speese’s compensation below the lower 25% quartile of base salaries paid to chief executive officers of comparable publicly owned companies in the retail industry.
		While Mr. Speese was not eligible to participate in the 2005 cash bonus program, the Committee retained the option of awarding a cash bonus to Mr. Speese at its discretion. In reviewing Mr. Speese’s contributions to us during the 2005 fiscal year, the Committee determined that some bonus payment should be made to Mr. Speese for his 2005 performance. Factors considered by the Committee in determining Mr. Speese’s cash bonus amount for 2005 were our financial performance in 2005, Mr. Speese’s industry experience and past performance, total cash compensation necessary to retain top executive talent, the fact that our other senior executives did not attain the financial performance portion of their bonus under the 2005 cash bonus program, and other subjective factors. On this basis, the Committee determined it appropriate to award a bonus to Mr. Speese calculated in a manner consistent with the bonus compensation paid to our other senior executives under the 2005 cash bonus plan, and awarded Mr. Speese a bonus of $205,500 for services rendered in 2005. The Committee specifically noted that Mr. Speese’s total compensation for 2005, taking into account the bonus approved by the Committee was below the lower 25% quartile of total compensation paid to chief executive officers by comparable publicly owned companies in the retail industry.
		2006 Compensation.The compensation to be paid to Mr. Speese for 2006 as established by the Committee is as follows:
		Salary.In determining the base salary for Mr. Speese for the 2006 fiscal year, the Committee considered our performance in 2005, and the level of compensation paid to the highest paid executive at comparable publicly owned companies. The Committee specifically noted that Mr. Speese’s salary remained below the lower 25% quartile of compensation paid to chief executive officers of comparable publicly owned companies. Based on these factors, the Compensation Committee established Mr. Speese’s 2006 base salary effective January 1, 2006, at $740,000, which was a 8.0% increase from his 2005 salary level. This adjustment was made to place Mr. Speese’s salary at the lower 25% quartile of base salaries paid to chief executive officers by comparable publicly owned companies in the retail industry.
		Cash Bonus.Mr. Speese does not participate in the 2006 cash bonus program established for our senior executives. The bonus, if any, to be awarded to Mr. Speese for the 2006 fiscal year will be determined by the Committee and recommended to the Board of Directors for approval, up to a maximum of 60% of Mr. Speese’s 2006 base salary.
		Long-Term Incentives.As part of our review of our executive compensation program, it was recommended and we determined it appropriate that we revisit our long-term incentive program and grant a long-term incentive award to Mr. Speese. Given Mr. Speese’s significant ownership of our common stock, the Committee determined that such long-term incentive award should be a cash award, containing substantially the same vesting schedule and requirements as those of the long-term incentive equity awards granted to our other senior executives. Accordingly, in January 2006, we awarded a long-term incentive cash award to Mr. Speese pursuant to the Long-Term Incentive Plan, (1) $250,000 of which vests ratably over a four year period ($62,500 on each anniversary date), (2) $125,000 of which will vest upon Mr. Speese’s completion of three years of continuous service from January 31, 2006, and (3) $125,000 of which will vest upon the attainment of a performance-based vesting requirement.

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		Perquisites.During 2005, Mr. Speese received compensation in the amount of (1) $3,698 as a result of non-business use of the corporate aircraft and (2) $810 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. Speese.
		Retirement Benefits.Mr. Speese does not participate in any retirement plan sponsored by us, including our 401(k) program.
Conclusion:		Review of All Components of Executive Compensation.The Committee has reviewed all components of our Chief Executive Officer’s and our other senior executives’ compensation, including salary, bonus, long-term incentive compensation, and the dollar value to the senior executive and cost to us of all perquisites and other personal benefits.
		The Compensation Committee’s Conclusion.Based on this review, the Committee found our Chief Executive Officer’s and our senior executives’ total compensation, individually and in the aggregate, to be reasonable and not excessive. The Committee specifically considered that we do not maintain any employment contracts or change of control agreements with such individuals and noted that the total compensation paid to such individuals was in the lower 25% quartile of compensation paid to similarly situated executives. In addition, when the Committee considers any component of our Chief Executive Officer’s and our other senior executives’ total compensation, the aggregate amounts and mix of all the components, including stock holdings, are taken into consideration in the Committee’s decisions.
		Internal Pay Equity.The Committee reviews each component of senior executive compensation, as well as total senior executive compensation, for internal consistency relative to other officers and employees at our corporate office. The Committee believes that the relative difference between senior executive compensation and the compensation of our other officers and employees at our corporate office is consistent with such differences found in our peer group and our reference labor market.
		Section 162(m).Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public companies for compensation over $1,000,000 paid for any fiscal year to the chief executive officer and four other most highly compensated executive officers. Awards of stock options issued pursuant to our Long-Term Incentive Plan qualify as deductible performance-based compensation under Section 162(m), so that any compensation realized from the exercise of stock options would not be affected by Section 162(m). Compensation paid during 2005 which is subject to the Section 162(m) cap did not exceed $1 million for any senior executive, including our Chief Executive Officer. Therefore, the Compensation Committee believes that we will not be subject to any Section 162(m) limitations on the deductibility of compensation paid to our senior executives for 2005. The Committee may in the future award compensation which would not comply with the Section 162(m) requirements for deductibility if the Committee concluded that to be in our best interest.

	COMPENSATION COMMITTEE
	J. V. Lentell, Chairman
	Richard K. Armey
	Laurence M. Berg

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PERFORMANCE GRAPH⁽¹⁾

Comparison of Cumulative Total Return Among

Rent-A-Center, NASDAQ Stock Market — Market Index andRent-A-Center’s “Peer Group”⁽²⁾

			2000					2001					2002					2003					2004					2005
RENT-A-CENTER				100.00					97.30					144.78					217.39					192.03					136.67
NASDAQ MARKET INDEX				100.00					79.71					55.60					83.60					90.63					92.62
PEER GROUP INDEX				100.00					122.29					131.06					205.67					330.40					276.50

(1)	Assumes $100 invested on December 29, 2000 and dividends reinvested, if any. Historical performance does not necessarily predict future results.
(2)	Our peer group consists of Aaron Rents, Inc. and Rent-Way, Inc.

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EXECUTIVE COMPENSATION AND OTHER INFORMATION

Summary of Compensation:		The following table summarizes the compensation we paid our Chairman and Chief Executive Officer and each of the four other most highly compensated executive officers, or our “named executive officers,” based on compensation earned by them in 2005:

															Long-Term
															Compensation
							Annual
							Compensation(1)								Securities
Name &															Underlying				All Other
Principal Position							Salary				Bonus				Options(#)				Compensation
Mark E. Speese				2005			$	685,000				$205,500				—				$4,508	(2)
	Chairman of the Board &			2004			$	650,000				$142,500				—				$2,012	(3)
	Chief Executive Officer			2003			$	600,000				$220,000				—				$585	(4)
Mitchell E. Fadel				2005			$	500,000				$110,400				—				$4,965	(5)
	President			2004			$	475,000				$85,500				—				$5,458	(6)
	& Chief Operating Officer			2003			$	450,000				$120,000				—				$6,025	(7)
Robert D. Davis				2005			$	295,000				$61,950				—				$4,406	(8)
	Senior Vice President —			2004			$	265,000				$47,700				—				$16,182	(9)
	Finance, Treasurer &			2003			$	180,000				$54,000				—				$38,633	(10)
	Chief Financial Officer
Dana F. Goble(11)				2005			$	285,700				$45,707				—				$275	(12)
	Executive Vice President			2004			$	279,000				$47,750				—				—
	— Operations			2003			$	265,000				$80,000				—				—
Christopher A. Korst				2005			$	270,600				$43,837				—				$364	(13)
	Senior Vice President			2004			$	252,000				$34,000				—				—
	— General Counsel			2003			$	240,000				$46,800				—				—
	& Secretary

Overview:	(1)	During 2005, the named executive officers did not receive any annual compensation not properly categorized as salary or bonus, except for certain perquisites or other benefits the aggregate cost of which did not exceed the lesser of $50,000 or 10%The Audit Committee of the totalBoard has selected Grant Thornton as our independent registered public accounting firm for the fiscal year ending December 31, 2007. Our Board of annual salary and bonusDirectors has further directed that we submit the selection of our independent registered public accounting firm for each such officer. All such amounts are set forth inratification by the “All Other Compensation” column.stockholders at the 2007 Annual Meeting.
	(2)	Represents (a) $3,698The Audit Committee reviews and pre-approves both audit and all permissible non-audit services provided by our independent registered public accounting firm, and accordingly, all services and fees in 2006 provided by Grant Thornton were pre-approved by the Audit Committee. The Audit Committee has considered whether Grant Thornton’s provision of deemed compensation as a result of non-business useservices, other than services rendered in connection with the audit of our corporate aircraftannual financial statements, is compatible with maintaining Grant Thornton’s independence. The Audit Committee has determined that the rendering of non-audit services by Grant Thornton during the fiscal year ended December 31, 2006 was compatible with maintaining their independence. Representatives of Grant Thornton will attend the Annual Meeting, will have an opportunity to make a statement if they so desire and (b) $810 of dollar value of insurance premiums paid by, or on behalf of us with respectwill be available to life insurance for the benefit of Mr. Speese.respond to appropriate questions.
	(3)	Represents (a) $1,428Stockholder ratification of deemed compensationthe selection of Grant Thornton as our independent registered public accounting firm is not required by our Bylaws or otherwise. However, the Board is submitting the selection of Grant Thornton to the stockholders for ratification as a resultmatter of non-business usegood corporate practice. The Audit Committee believes it to be in the best interests of our corporate aircraft and (b) $584 of dollar value of insurance premiums paid by, or on behalf of us with respectstockholders to life insuranceretain Grant Thornton as our independent registered accountants for the benefitfiscal year ended December 31, 2007. If the stockholders fail to ratify the selection, the Audit Committee will reconsider whether or not to retain Grant Thornton. Even if the selection is ratified, the Audit Committee in its discretion may direct the appointment of Mr. Speese.a different independent registered public accounting firm at any time during the year if they determine that such a change would be in our best interests and those of our stockholders. The Audit Committee annually reviews the performance of our independent registered public accounting firm and the fees charged for their services. The Audit Committee anticipates, from time to time, obtaining competitive proposals from other registered independent public accounting firms for our annual audit. Based upon the Audit Committee’s analysis of this information, we will determine which registered independent public accounting firm to engage to perform our annual audit each year.
Principal Accountant Fees and Services:	(4)	Represents dollar value of insurance premiums paidThe aggregate fees billed by or on behalf of us with respect to life insuranceGrant Thornton for the benefit of Mr. Speese.
	(5)	Represents (a) $4,200 of annual contributions or other allocations by us to our 401(k) Planfiscal years ended December 31, 2006 and (b) $765 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insuranceDecember 31, 2005 for the benefit of Mr. Fadel.
	(6)	Represents (a) $4,100 of annual contributions or other allocations by us to our 401(k) Plan, (b) $704 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. Fadel, and (c) $654 of deemed compensationprofessional services described below are as a result of non-business use of corporate aircraft.
	(7)	Represents (a) $5,500 of annual contributions or other allocations by us to our 401(k) Plan and (b) $525 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. Fadel.
	(8)	Represents (a) $4,200 of annual contributions or other allocations by us to our 401(k) Plan and (b) $206 of dollar value of insurance premiums paid by, or on behalf of, us with respect to life insurance for the benefit of Mr. Davis.
	(9)	Represents (a) $11,780 of tuition paid by us for an Executive Masters of Business Administration (EMBA) program attended by Mr. Davis, (b) $4,100 of annual contributions or other allocations by us to our 401(k) Plan, and (c) $302 of the dollar value of insurance

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		premiums paid by, or on behalf of, us with respect to life insurance for the benefit of Mr. Davis.follows:

		2006				2005
Audit Fees(1)			$802,454				$723,256
Audit-Related Fees(2)			$50,253				$25,940
Tax Fees(3)			$45,110				$69,640
All Other Fees(4)			$0				$0

	(10)	Represents (a) $34,345 of tuition paid by us for an Executive Masters of Business Administration (EMBA) program attended by Mr. Davis, (b) $4,000 of annual contributions or other allocations by us to our 401(k) Plan, and (c) $288 of the dollar value of insurance premiums paid by, or on behalf of, us with respect to life insurance for the benefit of Mr. Davis.
	(11)	Mr. Goble resigned from his position as Executive Vice President — Operations on January 4, 2006.
	(12)	Represents the dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. Goble.
	(13)	Represents the dollar value of insurance premiums paid by, or on behalf of, us with respect to life insurance for the benefit of Mr. Korst.

Use of Corporate Aircraft:		We own and operate a corporate jet for use by management for business purposes. From time to time, the corporate aircraft is available for non-business use to our Chief Executive Officer, President, Chief Operating Officer, Chief Financial Officer and Executive Vice Presidents. Use of the corporate aircraft by these executives for reasonable non-business use is subject to availability and must be pre-approved by the Chairman of the Audit Committee. Upon approval by the Chairman of the Audit Committee, the requesting executive must pay to us, in advance, 110% of the estimated total cost of the requested use of the corporate aircraft. If the actual cost for the non-business use of the corporate aircraft exceeds the advance deposit made by the requesting executive, the additional amount is deemed compensation to the requesting executive and reflected on his W-2 earnings statement for the year. During 2005, Mr. Speese received compensation in the amount of $3,698 as a result of non-business use of the corporate aircraft.
Employment Agreements:		We currently do not maintain employment agreements or change in control agreements with any of our executive officers.
Loyalty and Confidentiality Agreements:		In February 2006, each of our executive officers, including Messrs. Speese, Fadel, Davis, Korst and Bloom, entered into a Loyalty and Confidentiality Agreement with us in connection with their participation in the Long-Term Incentive Plan. Under the terms of each agreement, each executive officer agreed to, among other things:
		• avoid conflicts of interest with us and promptly inform us of any business opportunities that are related to our line of business;
		• avoid competing with us, setting up a business to compete with us, or undertaking other disloyal acts while employed with us;
		• not engage in any unauthorized use or disclosure of any of our confidential information;
		• during employment with us and for two years thereafter, generally not solicit, induce, or encourage any of our employees to leave us nor help another person or entity to hire away an employee of ours;
		• during employment with us and for two years thereafter, not, directly or indirectly, interfere with the relationship between us and a customer; and
		• during employment with us and for two years thereafter, not, directly or indirectly, accept or participate in any position of a competing business within a certain restricted area.

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2005 Option Holdings:		The following table contains the values for “in the money” options, meaning a positive spread between the year-end share price of $18.86 and the exercise price for the options held by our named executive officers. These values have not been, and might never be, realized. The options might never be exercised, and the value, if any, will depend on the share price on the exercise date. None of our named executive officers exercised any options held by them during 2005.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR

                        AND FISCAL YEAR END OPTION VALUES

Number of(1)

Value of Unexercised

Unexercised Options

In-the-Money Options

at Fiscal Year End

At Fiscal Year End

Exercisable(E)/

Exercisable(E)/

Name

Unexercisable(U)

Unexercisable(U)(1)

Mark E. Speese

522,500(E)

-0-(U)

$4,362,163(E)

$-0-(U)

Mitchell E. Fadel

375,000(E)

-0-(U)

$3,447,502(E)

$-0-(U)

Dana F. Goble

112,500(E)

-0-(U)

$968,875(E)

$-0-(U)

Robert D. Davis

50,000(E)

-0-(U)

$423,200(E)

$-0-(U)

Christopher A. Korst

43,750(E)

75,000(U)

$15,750(E)

$27,000(U)

(1)	The closing market price of our Common Stock on December 30, 2005 of $18.86, as reported on the Nasdaq National Market of the Nasdaq Stock Market, Inc., was used in the calculation to determine the value of unexercised options.

Long-Term Incentive Plans:		Long-Term Incentive Plan.We currently have one stock option plan entitled the Amended and Restated Rent-A-Center, Inc. Long-Term Incentive Plan. The Long-Term Incentive Plan is for the benefit of certain key employees, consultants and directors, and has been approved by our stockholders. The Long-Term Incentive Plan provides the Board broad discretion in creating equity incentives. Under the Long-Term Incentive Plan, 14,562,865 shares of our Common Stock were reserved for issuance under stock options, stock appreciation rights or restricted stock grants, of which, as of March 24, 2006, 6,008,037 have been issued under the Long-Term Incentive Plan and 4,866,499 have been allocated to outstanding awards which have not been exercised. Options granted to employees under the Long-Term Incentive Plan generally become exercisable over a period of one to four years from the date of grant and may be exercised up to a maximum of ten years from date of grant. Options granted to directors are exercisable immediately. There have been no grants of stock appreciation rights and all options have been granted with fixed prices. There were no options issued to any of our named executive officers under the Long-Term Incentive Plan during 2005.

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		2006 Long-Term Incentive Awards.On January 31, 2006, the Compensation Committee approved the issuance of long-term incentive awards to certain key employees, including Messrs. Fadel, Davis and Korst, under the Long-Term Incentive Plan. The awards were issued as equity awards which were separated into three distinct tranches,(1) 50% of which were issued in options to purchase Common Stock vesting ratably over a four year period, (2) 25% of which were issued in restricted stock units which will vest upon the employee’s completion of three years of continuous employment with us from January 31, 2006, (3) 25% of which were issued in restricted stock units subject to performance-based vesting based upon our achievement of a specified three year earnings before interest, taxes, depreciation and amortization (EBITDA). Such awards were as follows:

						Time-Based				Performance-Based
						Restricted Stock				Restricted Stock
Name		Options Granted(1)				Units Granted				Units Granted(2)
Mitchell E. Fadel			11,960				3,340				3,340
Robert D. Davis			5,320				1,485				1,485
Christopher A. Korst			3,190				890				890

(1)	The exercise price with respect to the options is $19.52 per share, based on the30-day average price of our Common Stock as of January 25, 2006.
(2)	The performance-based vesting condition is based upon our achievement of a specified three-year EBITDA target. In addition, each of the performance-based aspects of the long-term incentive awards is subject to adjustment dependent upon the achievement of the performance-based target. The issuance of the stock underlying the performance-based restricted stock units granted to Messrs. Fadel, Davis and Korst will range from a minimum of zero shares to each individual if we achieve less than 87.0% of the target EBITDA, to a maximum of 5,010 shares with respect to Mr. Fadel, 2,228 shares with respect to Mr. Davis and 1,335 shares with respect to Mr. Korst, if we achieve at least 115.1% of the target EBITDA.

	In addition, on January 31, 2006, the Compensation Committee approved the issuance of a long-term incentive award to Mr. Speese in the form of a cash award, (1) $250,000 of which vests ratably over a four-year period ($62,500 on each anniversary date), (2) $125,000 of which vests upon Mr. Speese’s completion of three years of continuous employment with us from January 31, 2006, and (3) $125,000 of which is subject to the performance-based vesting condition described above. The payout of the $125,000 of Mr. Speese’s long-term incentive award that is subject to such performance-based vesting condition will range from a minimum of $0 if we achieve less than 87.0% of the target EBITDA up to a maximum of $187,500 if we achieve at least 115.1% of the target EBITDA.
	2006 Plan. On March 24, 2006, the Board, upon recommendation of the Compensation Committee, adopted, subject to stockholder approval, the 2006 Plan and has directed that it be submitted for the approval of the stockholders. The 2006 Plan will become effective on the date it is approved by our stockholders. Upon approval of the 2006 Plan, our existing Long-Term Incentive Plan will terminate and no additional shares will be granted under the Long-Term Incentive Plan. The Board recommends that you vote “FOR” the approval of the 2006 Plan.

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EQUITY COMPENSATION PLAN INFORMATION

	The following table sets forth certain information concerning all equity compensation plans previously approved by our stockholders and all equity compensation plans not previously approved by our stockholders as of December 31, 2005.

Number of Securities to

Weighted-average

Number of securities

be issued upon exercise

exercise price of

remaining available for

of outstanding options,

outstanding options,

future issuance under equity

Plan category

warrants and rights

warrants and rights

compensation plan(1)

Equity compensation plans approved by security holders

5,018,977

18.70

3,859,283

Equity compensation plans not approved by security holders

-0-

-0-

-0-

Total

5,018,977

18.70

3,859,283

(1)	Pursuant to the terms of the Long-Term Incentive Plan, when an optionee leaves our employ, unvested options granted to that employee terminate and become available for re-issuance. Vested options not exercised within 90 days from the date the optionee leaves our employ terminate and become available for re-issuance.

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COMPENSATION COMMITTEE INTERLOCKS, INSIDER PARTICIPATION

AND RELATED PARTY TRANSACTIONS

Intrust Bank:		J.V. Lentell, one of our directors, serves as Vice Chairman of the Board of Directors of Intrust Bank, N.A., one of our lenders. Intrust Bank, N.A. is a $7.0 million participant in our senior credit facility. We also maintain operational checking and other accounts, including a $10.0 million revolving line of credit, with Intrust Bank, N.A., of which $2.7 million was drawn down as of March 24, 2006. In addition, Intrust Bank, N.A. serves as trustee of our 401(k) plan. During 2005, we paid Intrust a total of $974,573 in fees in connection with banking services provided by them, of which $718,422 was for administration fees and trustee fees for our 401(k) plan.
Apollo Management IV, L.P.:		On August 5, 1998, affiliates of Apollo Management IV, L.P. purchased $250 million of our Preferred Stock. Apollo had voting control of 100% of our Preferred Stock, which gave them the right to elect two individuals to our Board. In addition, pursuant to the stockholders agreement we entered into with Apollo and Mr. Speese, Apollo had the right to designate a third individual for nomination as a director who was to be elected by all of our stockholders.
		In connection with the issuance of our Preferred Stock, we entered into a registration rights agreement with Apollo, which, among other things, granted them two rights to request that their shares be registered. We registered the shares of common stock acquired by Apollo upon the conversion of the shares of our Preferred Stock held by them on a Form S-3 registration statement that was declared effective in September 2004. In May 2005, Apollo converted the remaining two shares of Preferred Stock held by them into shares of Common Stock, and sold all of the shares of Common Stock held by them in a public offering pursuant to the registration statement on Form S-3. Upon the closing of such offering, no shares of our Preferred Stock remained outstanding. Accordingly, Apollo no longer has any rights to elect any individuals to our Board. In addition, upon the closing of the offering, the stockholders agreement among us, Apollo and Mr. Speese terminated.
Texas Capital Bank:		ColorTyme is a party to an agreement with Wells Fargo Foothill, Inc., who provides $50.0 million in aggregate financing to qualifying franchisees of ColorTyme. Under this agreement, the occurrence of certain events may result in ColorTyme paying the outstanding debt to Wells Fargo Foothill and then succeeding to the rights of Wells Fargo Foothill under the debt agreements. An additional $20.0 million of financing is provided by Texas Capital Bank, National Association under an agreement similar to the Wells Fargo financing. Mr. Speese is a passive investor in Texas Capital Bank, owning less than 1% of its outstanding equity. We guarantee the obligations of ColorTyme under these agreements up to a maximum amount of $70.0 million, of which $30.3 million was outstanding as of December 31, 2005.
Committee Interlocks:		None of our executive officers served as a member of the compensation or similar committee or as a member of the Board of Directors of any other entity of which an executive officer served on the Compensation Committee or Board of Directors of Rent-A-Center.

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OTHER BUSINESS

The Board does not intend to bring any business before the annual stockholders meeting other than the matters referred to in this notice and at this date has not been informed of any matters that may be presented to the annual stockholders meeting by others. If, however, any other matters properly come before the annual stockholders meeting, it is intended that the persons named in the accompanying proxy will vote pursuant to the proxy in accordance with their best judgment on such matters.

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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM INFORMATION

Grant Thornton LLP served as our independent registered public accounting firm for the 2005 and 2004 fiscal years. We paid the following fees to Grant Thornton for professional and other services rendered by them during fiscal 2005 and 2004:

		2005				2004
Audit Fees(1)			$723,256				$728,829
Audit-Related Fees(2)			$25,940				$117,210
Tax Fees(3)			$69,640				$62,195
All Other Fees(4)			$0				$0

(1)		Represents the aggregate fees billed by Grant Thornton for (a) professional services rendered for the audit of our annual financial statements for 20052006 and 2004,2005, (b) the audit of management’s assessment of the effectiveness of the Company’sour internal controls over financial reporting as of December 31, 2006 and 2005, and 2004, (c) the reviews of the financial statements included in ourForms 10-Q filed with the SEC, and (d) services in connection with regulatory filings during 20052006 and 2004.2005. Such amount includes fees of $147,654$200,536 and $199,100$147,654 for services related to Sarbanes-Oxley planning and testing for internal control reporting for 2006 and 2005, and 2004, respectively.
(2)		Represents the aggregate fees billed by Grant Thornton for 20052006 and 20042005 for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under the caption “Audit Fees.”
(3)		Represents the aggregate fees billed by Grant Thornton for professional services rendered for tax compliance, tax advice and tax planning. For 2006, this amount consists of fees related to state tax work of $26,280, IRS exam consultation of $14,090 and Canadian tax work of $4,740. For 2005, this amount consists of fees related to state tax work of $31,000, acquired company tax return servicesservice of $32,200 and Canadian tax work of $6,440. For 2004, consists of fees for IRS audit services of $30,650 and acquired company tax return services of $31,545.
(4)		There were no fees paid to Grant Thornton in 20052006 or 20042005 for products andor services not included above under the captions “Audit Fees,” “Audit Related Fees” and “Tax Fees.”

The Audit Committee reviews and pre-approves both audit and all permissible non-audit services provided by our independent registered public accounting firm, and accordingly, all services and fees in 2005 provided by Grant Thornton were pre-approved by the Audit Committee. The Audit Committee of the Board has considered whether Grant Thornton’s provision of services, other than services rendered in connection with the audit of our annual financial statements, is compatible with maintaining Grant Thornton’s independence.

Representatives of Grant Thornton LLP, our independent registered public accounting firm for the fiscal year ended December 31, 2005, will attend the annual stockholders meeting and be available to respond to appropriate questions which may be asked by stockholders. These representatives will also have an opportunity to make a statement at the meeting if they desire to do so.OUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE “FOR” THE APPROVAL OF THE
RATIFICATION OF GRANT THORNTON AS OUR REGISTERED INDEPENDENT AUDITORS.

The Audit Committee annually reviews the performance of our independent registered public accounting firm and the fees charged for their services. The Audit Committee anticipates, from time to time, obtaining competitive proposals from other registered independent public accounting firms for our annual audit. Based upon the Audit Committee’s analysis of this information, we will determine which registered independent public accounting firm to engage to perform our annual audit each year.

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AUDIT COMMITTEE REPORT

In accordance with its written charter adopted by the Board of Directors, the Audit Committee assists the Board in fulfilling its oversight responsibilities by, among other things, reviewing the financial reports and other financial information provided by the Company to any governmental body or the public.

In discharging its oversight responsibilities, the Audit Committee obtained from the independent registered public accounting firm a formal written statement describing all relationships between the firm and the Company that might bear on the auditors’ independence consistent with Independent Standards Board Standard No. 1, discussed with the independent auditors any relationships that may impact their objectivity and independence, and satisfied itself as to the auditors’ independence. The Audit Committee also discussed with management, the internal auditors and the independent auditors the integrity of the Company’s financial reporting processes, including the Company’s internal accounting systems and controls, and reviewed with management and the independent auditors the Company’s significant accounting principles and financial reporting issues, including judgments made in connection with the preparation of the Company’s financial statements. The Audit Committee also reviewed with the independent auditors their audit plans, audit scope and identification of audit risks.

The Audit Committee discussed with the independent auditors the matters required to be discussed by Statement on Auditing Standards No. 61, as amended, and, with and without management present, discussed and reviewed the results of the independent auditors’ examination of the consolidated financial statements of the Company.

The Audit Committee reviewed and discussed the audited consolidated financial statements of the Company as of and for the fiscal year ended December 31, 20052006 with management and the independent auditors. Management is responsible for the Company’s financial reporting process, including its system of internal control over financial reporting (as defined inRule 13a-15(f) promulgated under the Securities Exchange Act of 1934), and for the preparation of the Company’s consolidated financial statements in accordance with generally accepted accounting principles. The independent auditor is responsible for auditing those financial statements, and expressing an opinion on (1) management’s assessment of the effectiveness of internal control over financial reporting and (2) the effectiveness of internal control over financial reporting .reporting. The Audit Committee’s responsibility is to monitor and review these processes. The members of the Audit Committee are “independent” as defined by SEC and Nasdaq rules, and, although our Board has determined each member of the Audit Committee is an “audit committee financial expert” as defined by SEC rules, none of the members of the Audit Committee represent themselves to be, or to serve as, accountants or auditors by profession or experts in the field of accounting or auditing.

For the fiscal year 2005, management completed the documentation, testing and evaluation of

The Audit Committee discussed with the Company’s system ofinternal and independent auditors the overall scope and plans for their respective audits, including internal control over financial reporting in response to the requirements set forth intesting under Section 404 of the Sarbanes-Oxley Act of 2002, and related regulations.Act. The Audit Committee monitoredperiodically meets with the progressCompany’s internal and independent auditors, with and without management present, and in private sessions with members of senior management to discuss the evaluation and provided oversight and guidance to management during the process. In connection with this oversight, the Audit Committee received periodic updates provided by management and the independent auditors. At the conclusionresults of the process, management provided the Audit Committee with a report on management’s assessment of the effectivenesstheir examinations, their evaluations of the Company’s internal control overcontrols, and the overall quality of the Company’s financial reporting as of December 31, 2005.reporting. The Audit Committee also periodically meets in executive session.

Based upon

In reliance on the above-mentioned reviewreviews and discussions with management and the independent auditors,referred to above, the Audit Committee recommended to the Board (and the Board subsequently approved the recommendation) that the Company’s audited consolidated financial statements be included in itsthe Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, for filing with the Securities and Exchange Commission. The Audit Committee has also appointed the Company’s independent auditors for 2007.

AUDIT COMMITTEE
Mary Elizabeth Burton, Chairperson
Michael J. Gade
J.V. Lentell

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EXECUTIVE OFFICERS

The Board appoints our executive officers at the first Board meeting following our annual stockholders meeting and updates the executive officer positions as needed throughout the year. Each executive officer serves at the behest of the Board and until their successors are appointed, or until the earlier of their death, resignation or removal.

The following table sets forth certain information with respect to our executive officers as of March 19, 2007:

Name		Age				Position
Mark E. Speese			49			Chairman of the Board of Directors and Chief Executive Officer
Mitchell E. Fadel			49			President and Chief Operating Officer
William S. Short			49			Executive Vice President — Operations
Robert D. Davis			35			Senior Vice President — Finance, Chief Financial Officer and Treasurer
Christopher A. Korst			47			Senior Vice President — General Counsel and Secretary
David E. West			56			Senior Vice President — Operational Services

Mark E. Speese		Mr. Speese has served as the Chairman of our Board and Chief Executive Officer since October 2001 and has served as one of our directors since 1990. Mr. Speese previously served as our Vice Chairman from September 1999 until March 2001. From 1990 until April 1999, Mr. Speese served as our President. Mr. Speese also served as our Chief Operating Officer from November 1994 until March 1999.
Mitchell E. Fadel		Mr. Fadel has served as our President since July 2000, as our Chief Operating Officer since December 2002 and as a director since December 2000. From November 1992 until July 2000, Mr. Fadel served as President and Chief Executive Officer of ColorTyme.
William S. Short		Mr. Short has served as our Executive Vice President since November 2006. From July 1996 to November 2006, Mr. Short was employed by Rent-Way Inc., serving in various capacities including President and a member of Rent-Way’s board since May 2005. Mr. Short also served as Senior Vice President of Operations of Rent-Way from 2002 to 2004, and Executive Vice President — Chief Operating Officer of Rent-Way from 2004 to 2005. We acquired Rent-Way in November 2006.
Robert D. Davis		Mr. Davis has served as our Senior Vice President — Finance since September 1999, as our Chief Financial Officer since March 1999 and as our Treasurer since January 1997. From September 1998 until September 1999, Mr. Davis served as our Vice President — Finance and Treasurer. Mr. Davis is a licensed certified public accountant in the State of Texas.
Christopher A. Korst		Mr. Korst has served as our Senior Vice President — General Counsel since May 2001 and as Secretary since September 2004. From January 2000 until May 2001, Mr. Korst owned and operated AdvantEdge Quality Cars, which he acquired in a management buyout.
David E. West		Mr. West has served as our Senior Vice President — Operational Services since May 2005. From September 2004 until May 2005, Mr. West served as our Vice President — Operational Services. From August 1992 until September 2004, Mr. West served as our Vice President — Product Service.

Code of Ethics:		Our Board has adopted a Code of Business Conduct and Ethics governing all of our employees, including our Chief Executive Officer, Chief Financial Officer, our principal accounting officer and controller. A copy of this Code of Business Conduct and Ethics is published on our website at www.rentacenter.com. We intend to make all required disclosures concerning any amendments to, or waivers from, the Code of Business Conduct and Ethics on our website.

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EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

Historical Overview

Historically, our executive compensation program for our named executive officers has been relatively uncomplicated and consistent with our “no-frills” culture, consisting of cash compensation comprised of base salary and a cash bonus, as well as awards of options to purchase shares of our common stock upon hiring or promotion. Prior to 2006, we generally had not entered into employment agreements with our named executive officers and we did not have a formal severance plan structure. In addition, our executive compensation program has historically included few perquisites.

As our business has grown in recent years, our ability to attract and retain executives who possess the specific skills and experience which we believe are important to the continued growth and success of our business has become increasingly important. In conjunction with this increasing emphasis which we placed on our ability to attract and retain such executive talent, our management, at the request of our Board, began to evaluate our historical compensation practices, including our compensation structure and policies with respect to our senior executives, including our named executive officers. As part of this evaluation, our management undertook an examination of our compensation structure and philosophy with respect to such individuals. Based upon both conversations with executive candidates, as well as its review of data with respect to the compensation arrangements offered by similarly-situated public companies in the retail industry, our management believed that our compensation arrangements were placing us at a competitive disadvantage with respect to our ability to attract and retain such executive talent.

In response to the concerns regarding our compensation arrangements, in September 2005 the Compensation Committee retained Hewitt Associates LLC, an executive compensation consulting firm, to assist it in conducting a more formal evaluation of our compensation arrangements for our senior executives, including our named executive officers. The results of that review reinforced the beliefs of our management that our compensation arrangements with respect to our senior executives, including our named executive officers, were not competitive in several respects with those offered by similarly-situated public companies in the retail industry, and that total compensation paid to our senior executives was below the lower 25% quartile of amounts paid to senior executives at similarly-situated public companies in the retail industry. In an effort to increase our ability to attract and retain executive talent and to more closely align the interests of our named executive officers with us and our stockholders, Hewitt made recommendations to our Chief Executive Officer, Mr. Speese, and the Compensation Committee with respect to such compensation. Recognizing that we were at a significant competitive disadvantage, but that immediate adjustments to the compensation of our senior executives to a more competitive position would result in a substantial percentage increase in compensation, the Compensation Committee made initial adjustments to target total compensation to be paid to our named executive officers for the 2006 fiscal year at the lower 25% quartile of the total compensation paid to executive officers with comparable duties and responsibilities at similarly-situated public companies in the retail industry, recognizing that the total compensation paid to our named executive officers could increase over a period of years to the25%-50% range, if warranted by performance.

Compensation Objectives

The Compensation Committee has identified four primary objectives for our executive compensation program. These objectives govern the decisions the Compensation Committee makes with respect to the amount and type of compensation payable to our named executive officers. The objectives of our executive compensation program are to:

	•	attract, retain and motivate senior executives with competitive compensation opportunities;
	•	balance short-term and long-term strategic goals;
	•	align our executive compensation program with the core values identified in our mission statement which include respect for people, integrity, a commitment to excellence, ownership and stakeholder focus; and
	•	reward performance that increases the value of our stock.

In applying these objectives, the Compensation Committee primarily relies upon:

	•	input from Mr. Speese, with respect to our named executive officers other than him;

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	•	data compiled by Hewitt in 2005 and our Human Resources department in 2006 with respect to the executive compensation practices of publicly-traded companies in the retail industry; and
	•	its own judgment relative to general economic conditions and our progress in achieving our short-term and long-term goals.

Key factors affecting the Compensation Committee’s judgment include our financial performance within each named executive officer’s sphere of influence, Mr. Speese’s input as to the individual contribution of each named executive officer relative to his role and responsibilities with us and, with respect to Mr. Speese’s compensation, the Compensation Committee’s evaluation of his performance.

Compensation Process

The Compensation Committee typically begins the process of determining the amount and mix of total compensation to be paid to our senior executives, including our named executive officers, in December of each year and finalizes such amounts in the following January. This enables the Compensation Committee to examine and consider our performance during the previous year in establishing the current year’s compensation.

The Compensation Committee has traditionally relied heavily on the input and recommendations of our Chief Executive Officer, Mr. Speese, who reviews and makes recommendations to the Compensation Committee with respect to our executive compensation programs, including the compensation arrangements with our named executive officers. The Compensation Committee believes Mr. Speese’s unique insight into our business, his role as a founder of our company, hisday-to-day interaction with our senior executives, as well as his 28 years of experience in therent-to-own industry provides a valuable resource to the Compensation Committee with respect to our executive compensation programs. However, Mr. Speese does not participate in the discussions among the members of the Compensation Committee with respect to his own compensation. Prior to providing his input and recommendations to the Compensation Committee, Mr. Speese typically conducts an informal position-level review of our compensation programs company-wide, which includes a review of our named executive officers’ compensation, for internal consistency relative to our other officers and employees and attempts to achieve consistency between the relative difference between the compensation of our named executive officers and the compensation of our other officers and employees. In addition, various members of the Compensation Committee have significant professional experience in the retail industry, as well as with respect to the executive compensation practices of large publicly-traded companies, which provide such individuals with a frame of reference within which to evaluate our executive compensation program for our senior executives, including our named executive officers.

When the Compensation Committee considers the total compensation for our named executive officers, it reviews a tally sheet which contains information regarding, among other things:

	•	each named executive officer’s compensation for the previous three years;
	•	the type and amount of long-term incentive awards granted to each named executive officer in the previous three years;
	•	our equity securities owned by each named executive officer as of the end of the most recently completed fiscal year;
	•	the proceeds realized by each named executive officer from option exercises in the previous three years; and
	•	the severance payments to which each named executive officer would be entitled to receive upon the occurrence of certain events, taking into account the proposed compensation to be paid to such named executive officer for the new fiscal year.

Forms of Compensation

The following forms of compensation are currently utilized by the Compensation Committee in compensating our named executive officers:

	•	base salary, which is paid in cash;
	•	bonuses, which are paid in cash and typically include a long-term incentive award;
	•	long-term incentive awards;

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	•	severance arrangements; and
	•	limited fringe benefits, including perquisites.

Base Salary.  The base salary for each of our named executive officers represents the guaranteed portion of their total compensation. Base salary is intended to reward the performance of each named executive officer during the fiscal year relative to his position with us. The base salary for each of our named executive officers is determined annually by the Compensation Committee. In establishing the base salary for each of our named executive officers, the Compensation Committee reviews:

	•	the named executive officer’s historical performance in his position with us, based on the input received from Mr. Speese with respect to each named executive officer (other than himself);
	•	Mr. Speese’s recommendations as to the proposed base salary, other than his own;
	•	our financial performance; and
	•	recent comparative peer data, which is compiled by our Human Resources department and compared to similar data previously compiled by Hewitt and which generally consists of statistical compensation studies of public companies in the retail industry.

In evaluating each named executive officer’s historical performance in his position with us, the Compensation Committee relies primarily on the input received from Mr. Speese, who evaluates the performance of each named executive officer in his position with us relative to such named executive officer’s performance in previous years, based on certain subjective factors. These factors typically include whether or not the named executive officer achieved the goals set under the MBO program discussed below, the financial performance within the area of responsibility of the named executive officer and other subjective factors. Consistent with the Compensation Committee’s evaluation of the total compensation of our named executive officers, Mr. Speese and the Compensation Committee targeted the base salary for each of our named executive officers for the 2006 fiscal year at or near the lower 25% quartile of the base salaries paid to executive officers with comparable duties and responsibilities at similarly-situated public companies in the retail industry, recognizing that the base salary paid to each of our named executive officers could increase over a period of years to the 25%-50% range, if warranted by performance.

In determining Mr. Speese’s base salary for 2006, the Compensation Committee considered our financial performance in 2005 and the level of compensation paid to the highest paid executive at similarly situated public companies in the retail industry. The Compensation Committee specifically noted that Mr. Speese’s base salary for 2005 remained below the lower 25% quartile of base salaries paid to the highest paid executive at similarly situated public companies in the retail industry. Based on these factors, the Compensation Committee established Mr. Speese’s base salary for 2006 at $740,000, which was an 8.0% increase from his 2005 base salary level. This adjustment was made to place Mr. Speese’s base salary at the lower 25% quartile of base salaries paid to the highest paid executive at similarly situated public companies in the retail industry.

In determining the base salary for each of our other named executive officers for 2006, the Compensation Committee relied primarily on the recommendations of Mr. Speese. In formulating such recommendations, Mr. Speese considered various subjective factors, including whether or not the named executive officer achieved the goals set under the MBO program discussed below, the financial performance within the area of responsibility of the named executive officer, the amount that the named executive officer had previously been paid and where such amount compared to the lower 25% quartile of base salaries.

The Compensation Committee believes that the base salaries paid to our named executive officers are appropriate to facilitate our ability to attract, retain and motivate our named executive officers with annual compensation minimums that are competitive with those offered by similarly situated public companies in the retail industry. For a description of the base salaries paid to our named executive officers for 2006, you should read the Summary Compensation Table on page 22 of this proxy statement.

Bonus.  Bonuses are typically awarded to our named executive officers, other than Mr. Speese, annually based on our management bonus opportunity program, which we refer to as our “MBO program.” Under our MBO program, cash bonuses are typically established at a pre-determined percentage of the named executive officer’s base salary, with such percentage amount set in accordance with the eligible named executive officer’s position and responsibilities with us.

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Of the maximum cash bonus amount an eligible named executive officer may earn pursuant to our MBO program, a pre-determined percentage of that amount is typically contingent on our achievement of a target amount of financial performance. In setting the target amount of financial performance, the Compensation Committee typically reviews with Mr. Speese our financial projections as well as the market’s expectations with respect to our financial performance for the applicable year. Our MBO program contains provisions such that each named executive officer (other than Mr. Speese) is typically eligible to receive (i) an additional cash bonus equal to a pre-determined percentage of such named executive officer’s base salary, with such percentage amount set in accordance with the eligible named executive officer’s position and responsibilities with us, in the event that we exceed the financial performance measure, and (ii) a portion of the amount such named executive officer would otherwise be entitled to receive upon our achievement of the target level of financial performance in the event that we approach, yet fail to achieve, the full target level of financial performance.

The remaining percentage of the maximum cash bonus amount is typically contingent upon the achievement by the eligible named executive officer of certain individual goals and objectives within such named executive officer’s sphere of influence. Typically, as a result of a collaborative process between each named executive officer and Mr. Speese, approximately three to five distinct individual goals and objectives are established for each named executive officer, some of which may be linked to our performance within the named executive officer’s sphere of influence, and some of which may be more personal in nature, depending on the facts and circumstances applicable to each named executive officer. Such individual goals and objectives may include the management of expenses within a named executive officer’s area of responsibility, the professional development of personnel which report directly to a named executive officer, and the implementation of certain initiatives.

In January of each year, Mr. Speese meets with each named executive officer to review the named executive officer’s performance with respect to such individual goals and objectives. In the event that an eligible named executive officer approaches, yet fails to achieve, all of the individual goals and objectives, such named executive officer is typically eligible to receive a portion of the maximum amount otherwise payable upon the achievement of the individual goals and objectives. To the extent that the achievement of such individual goals and objectives is not objectively quantifiable, the portion of the maximum amount otherwise payable upon the achievement of the individual goals and objectives which is ultimately awarded to a particular named executive officer reflects Mr. Speese’s subjective determination, based upon his collaboration with such named executive officer, as to the named executive officer’s performance with respect to any such individual goals and objectives.

For 2006, our MBO program was structured as follows:

	•	40% of the cash bonus opportunity for each of our eligible named executive officers was contingent on our achievement of consolidated after-tax net income for 2006 of $144.9 million, and
	•	the remaining 60% was contingent on the achievement by each of our named executive officers of distinct individual goals and objectives.

The 60%/40% allocation for our MBO program represents the Compensation Committee’s determination that, although a substantial portion of the cash bonus opportunity for our named executive officers should be dependent upon our overall financial performance, the individual performance of each named executive officer may be more accurately measured in a number of ways which are not necessarily reflected in our overall financial performance, which may be largely dependent on a variety of factors over which an individual named executive officer may not exercise control. The Compensation Committee determined that consolidated net income was the appropriate basis upon which to measure our performance in this context based in part upon input received from Hewitt regarding the performance measures utilized with respect to similar awards made by similarly-situated public companies in the retail industry. The Compensation Committee also believes that consolidated net income generally represents an accurate indicator of our financial performance over a one-year period of time.

The percentage allocation as well as the potential ultimate payouts pursuant to our MBO program for each year are typically approved by the Compensation Committee in January at the same time that all compensation for our named executive officers is approved. This enables the Compensation Committee and Mr. Speese to examine the named executive officer’s performance during the previous year, establish performance goals for our eligible named executive officers relative to such performance, as well as determine financial performance targets for the new fiscal year based in part upon the previous year’s performance. The payment of cash bonuses, if any, to our named executive officers is normally made in a single lump sum, subject to payroll taxes and tax withholdings, in January after the end of the performance period during which the cash bonuses were earned.

The Compensation Committee recognizes, however, that there may be instances where the accounting treatment of a matter may have a disproportionate impact on our financial results in any given year, irrespective of whether

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or not such accounting impact truly reflects our operating results for that fiscal year, as is the case with changes in our accruals for insurance and legal liabilities. Accordingly, the Compensation Committee uses its discretion in evaluating our financial performance with respect to the MBO program, and may exclude certain accounting measures and extraordinary items in determining whether we met our financial performance target when doing so is consistent with our compensation objectives. In determining bonuses under our MBO program for 2006, the Compensation Committee adjusted consolidated net income to eliminate the effect of legal liability reserves and refinancing charges, as the Compensation Committee determined that the accounting effects of such reserves and charges on our 2006 consolidated net income was not indicative of the performance of our named executive officers during 2006.

Mr. Speese does not participate in our MBO program, but the Compensation Committee has retained the ability to award a cash bonus to Mr. Speese in its discretion pursuant to the terms of his employment agreement, which is discussed in greater detail below. In determining whether Mr. Speese is awarded a cash bonus and if so, in what amount, the Compensation Committee will review our financial performance for the relevant fiscal year, Mr. Speese’s past performance, total cash compensation necessary to retain top executive talent, and whether we attained the financial performance measure for the MBO program for our other senior executive officers, including our named executive officers.

The Compensation Committee believes that the cash bonuses which our eligible named executive officers are entitled to receive pursuant to the above-described policies are appropriate to promote our interests as well as those of our stockholders by providing our named executive officers with financial rewards upon achievement of specified business as well as individualized objectives, which the Compensation Committee believes will ultimately increase the value of our stock, as well as help us attract and retain our named executive officers by providing attractive compensation opportunities. For a description of the cash bonuses paid to our named executive officers for 2006, you should read the Summary Compensation Table on page 22 of this proxy statement.

Long-Term Incentives.  Generally, long-term incentive awards are made to our named executive officers pursuant to (i) theRent-A-Center, Inc. Long-Term Incentive Plan, which we refer to as the “2006 Plan,” which was adopted in May of 2006 and replaced the previously-existingRent-A-Center, Inc. Amended and Restated Long-Term Incentive Plan, which we refer to as our “Previous Plan,” and (ii) following our acquisition of Rent-Way, Inc. in November of 2006, theRent-A-Center, Inc. 2006 Equity Incentive Plan (formerly the Rent-Way, Inc. 2006 Equity Incentive Plan), which we refer to as the “Rent-Way Plan.” Pursuant to the terms of each of the 2006 Plan and the Rent-Way Plan, awards granted thereunder may be made at such times and upon such vesting and other conditions as determined by the Compensation Committee, and may be made in the form of stock options, stock awards, other equity awards, and performance-based equity awards. In addition, pursuant to the 2006 Plan, awards may be made in the form of cash awards.

The primary form of long-term incentive award that the Compensation Committee has historically granted to our named executive officers consist of options to purchase shares of our common stock. However, in 2005, as part of the Compensation Committee’s review of our executive compensation program, the Compensation Committee determined that the grant of restricted stock awards could be utilized to provide an additional incentive for our named executive officers to remain in their positions with us by providing them with a form of compensation that is competitive with those offered by similarly situated public companies in the retail industry. Accordingly, in January of 2006, the Compensation Committee granted long-term incentive awards to Messrs. Davis, Fadel, Korst and West which included options, time-based and performance-based restricted stock, as well as a cash award to Mr. Speese subject to similar vesting conditions. For a description of such long-term incentive awards, you should read the Summary Compensation Table on page 22 of this proxy statement and the Grants of Plan-Based Awards Table on page 24 of this proxy statement.

In determining the mix and amounts of long-term incentive awards to be granted to our named executive officers, the Compensation Committee relies primarily upon:

	•	the recommendations of Mr. Speese;
	•	data compiled by Hewitt in 2005 and our Human Resources department in 2006 with respect to long-term incentive awards paid to the named executive officers at similarly situated public companies in the retail industry;
	•	the amount of our equity held by the individual; and

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	•	the amount of cash compensation that each named executive officer is eligible to earn for the relevant fiscal year.

The Compensation Committee believes that awarding our named executive officers non-cash, long-term compensation, primarily in the form of long-term incentive awards which may increase in value in conjunction with the satisfaction by us of pre-determined performance measuresand/or an increase in the value of our common stock, more effectively aligns their interests with ours. The Compensation Committee also believes that such awards will provide our named executive officers with an incentive to remain in their positions with us, since the determination as to whether a particular measure for our performanceand/or an increase in the value of our common stock has been satisfied is typically made over an extended period of time. For a description of the long-term incentive awards granted to our named executive officers for 2006, you should read the Summary Compensation Table on page 22 of this proxy statement and the Grants of Plan-Based Awards Table on page 24 of this proxy statement.

The Compensation Committee has generally granted long-term incentive equity awards to our named executive officers in the following forms:

Options.  The Compensation Committee, together with management, has established a company-wide option grant program whereby each district manager, regional director, vice president, senior vice president and executive officer is generally awarded a specified number of options, based upon his position with us at the time of promotion to such position. Each quarter, members of our senior management typically compile a list of all such newly-hired or promoted individuals and submit the list to the Compensation Committee, which reviews and ultimately approves the grant of options to such individuals, including our named executive officers, according to such formula on the first day of each fiscal quarter, irrespective of whether our Board or the Compensation Committee is in possession of material non-public information.

However, in January 2006, together with the grant of restricted stock which is discussed below, we granted options to Messrs. Davis, Fadel, Korst and West as a portion of a long-term incentive award in connection with our efforts to bring our compensation arrangements with respect to such named executive officers more in line with those offered by similarly situated public companies in the retail industry. In addition, from time to time, the Compensation Committee has also granted options as a portion of a bonus payment, such as in October 2006, with respect to Mr. Speese. The Compensation Committee believes that such option awards are consistent with the objectives of our executive compensation program, as grants of stock options provide an incentive for the creation of stockholder value, since the benefit of the award can only be realized with an appreciation in the price of our common stock. For a description of such long-term incentive awards, you should read the Summary Compensation Table on page 22 of this proxy statement and the Grants of Plan-Based Awards Table on page 24 of this proxy statement.

Pursuant to the terms of the 2006 Plan and the Rent-Way Plan, an option to purchase shares of our common stock will generally expire on the tenth anniversary of the date it is granted. In addition, the 2006 Plan and the Rent-Way Plan each provide that the purchase price per share of our common stock covered by an option granted thereunder may not be less than the fair market value per share on the date the option is granted. Under both the 2006 Plan and the Rent-Way Plan, the fair market value per share of our common stock on the date the option is granted is determined by reference to the closing price for shares of our common stock on the Nasdaq Global Select Market on the last market trading day prior to the date the option is granted. The options granted to our named executive officers typically provide for vesting over a four-year period, with one-quarter of each such grant vesting each year. Based upon input previously received from Hewitt, the Compensation Committee believes that the manner in which we determine the duration of the options, the vesting period and the purchase price per share of our common stock underlying such options is commensurate with similar measures utilized by similarly situated public companies in the retail industry.

Restricted Stock.  The Compensation Committee also may grant long-term incentive awards under the 2006 Plan and the Rent-Way Plan to our named executive officers in the form of restricted stock units which vest either (i) incrementally over a period of time as determined in the Compensation Committee’s discretion, or (ii) upon the achievement of specified goals for our performance over a period of time, each as specified by the Compensation Committee. We have begun a practice whereby we grant awards of restricted stock units to our named executive officers as a portion of a long-term incentive award in January of each year. The Compensation Committee typically determines the dollar value for each award of restricted stock with time-based vesting and performance-based vesting to each of our named executive officers, based upon the input received from Hewitt and Mr. Speese with respect to the dollar value of similar awards paid to executive officers with comparable duties and responsibilities at similarly-situated public companies in the retail industry. As described in greater detail below,

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the annual awards of restricted stock units to our named executive officers are typically structured so that half of the value of such restricted stock awards is granted in the form of restricted stock units with time-based vesting, and the other half of the value of the restricted stock awards is granted in the form of restricted stock units with performance-based vesting.

Restricted Stock With Time-Based Vesting.   In connection with the evaluation of our compensation arrangements for our senior executives, including our named executive officers, the Compensation Committee, based upon input received from Hewitt and Mr. Speese with respect to forms of compensation paid to executive officers with comparable duties and responsibilities at similarly-situated public companies in the retail industry, determined that an award of restricted stock with time-based vesting to certain of our named executive officers would both provide such individuals with a minimum level of value while also providing an additional incentive for such individuals to remain in their positions with us. Accordingly, the Compensation Committee awarded such restricted stock units to Messrs. Davis, Fadel, Korst and West in January 2006, and at that time selected a three-year period of time as the period for which each such named executive officer was required to remain in his position with us in order to realize the award. The Compensation Committee selected the three-year period based upon both the previous input received from Hewitt regarding the time-period utilized with respect to similar awards made by similarly-situated public companies in the retail industry, as well as upon its belief that a three-year period was an appropriate length of time in order to encourage our named executive officers to remain in their positions with us to realize the award.

Once the percentage of the total dollar value of a long-term incentive award which is to be allocated to the award of restricted stock with time-based vesting is determined, the number of shares of time-based restricted stock to be granted is determined by dividing that dollar value by the closing price for shares of our common stock on the Nasdaq Global Select Market as of the date immediately preceding the grant date for such award. That number is then typically added to the number of restricted stock units with performance-based vesting to be granted pursuant to such award, which are determined in the manner described below, and such total is then divided by two to determine the number of restricted stock units with time-based vesting to be granted pursuant to each such award.

Restricted Stock With Performance-Based Vesting.  In connection with the evaluation of our compensation arrangements for our senior executives, including our named executive officers, the Compensation Committee, based upon input received from Hewitt with respect to forms of compensation paid to executive officers with comparable duties and responsibilities at similarly-situated public companies in the retail industry, determined that an award of restricted stock with performance-based vesting to certain of our named executive officers would both provide an additional incentive for our named executive officers to remain in their positions with us in order to realize the benefit of such award and would also focus our named executive officers on a performance parameter which the Compensation Committee considers beneficial to increasing the value of our stock, and consequently, increases stockholder value. Accordingly, the Compensation Committee awarded such restricted stock units to Messrs. Davis, Fadel, Korst and West in January 2006, and at that time selected $1.0998 billion as the target for our EBITDA over a three-year period as the measure of our performance which determines whether such restricted stock units vest.

The Compensation Committee determined that EBITDA was the appropriate basis upon which to measure our performance in this context based in part upon input received from Hewitt regarding the performance measures utilized with respect to similar awards made by similarly-situated public companies in the retail industry. The Compensation Committee also believes EBITDA represents an accurate indicator of our performance over an extended period of time, as an EBITDA measure incorporates certain factors which the Compensation Committee believed were important to an understanding of our performance over such period, such as an increase in revenue as well as the management of our expenses, while not incorporating other factors which the Compensation Committee did not believe were important to an understanding of our performance over such period, such as any repurchases of our outstanding shares which would affect an earnings per share measurement. In setting the target amount of EBITDA over such three-year period, the Compensation Committee reviewed with Mr. Speese our financial projections as well as the market’s expectations with respect to our financial performance over such period. The Compensation Committee selected a three-year period over which to measure EBITDA based upon both input received from Hewitt regarding the time-period utilized with respect to similar awards made by similarly-situated public companies in the retail industry, as well as upon its belief that a three-year measurement period was appropriate to place an emphasis on our operating results over an extended period of time, as opposed to the single year measure which is typically utilized in our MBO program.

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In addition, the awards of restricted stock with performance-based vesting to certain of our named executive officers in January 2006 contained provisions with respect to our achievement of the target EBITDA, such that each eligible named executive officer may receive (i) an additional payout pursuant to such award in the event that we exceed the target EBITDA over such period, and (ii) a portion of the target payout pursuant to such award in the event that we approach, yet fail to achieve, the target level of financial performance. The Compensation Committee believed that such adjustments were appropriate to operate as an additional incentive for our named executive officers in the event that we either exceed or approach, yet fail to achieve, the target EBITDA.

Once the percentage of the total dollar value of a long-term incentive award which is to be allocated to the award of restricted stock with performance-based vesting is determined, the number of shares of performance-based restricted stock to be granted is determined by dividing that dollar value by an amount equal to 75% of the closing price for shares of our common stock on the Nasdaq Global Select Market as of the date immediately preceding the grant date for such award. That number is then typically added to the number of restricted stock units with time-based vesting to be granted pursuant to such award, which are determined in the manner described above, and such total is then divided by two to determine the number of restricted stock units with performance-based vesting to be granted pursuant to each such award. The Compensation Committee selected this approach to ease the administration and communication to the recipients of such awards, and discussed such approach with Hewitt, who advised that such approach was similar to those utilized by similarly-situated public companies in the retail industry. The 25% discount factor represents the Compensation Committee’s determination of the appropriate reduction to the value of such awards based upon both the previous input received from Hewitt regarding the discount factors utilized with respect to similar awards made by similarly-situated public companies.

By way of example, consider the situation where the Compensation Committee grants a long-term incentive award to an individual with a portion of such award consisting of restricted stock with time-based vesting and another portion of such award consisting of restricted stock with performance-based vesting. Under this scenario, assume that the Compensation Committee allocates a dollar value of $12,500 to each type of restricted stock award, and that the closing price for shares of our common stock on the Nasdaq Global Select Market as of the date immediately prior to such grant was $30.00. To determine the number of shares to be allocated to each type of restricted stock award, the Compensation Committee would first consider the restricted stock with time based-vesting by dividing $12,500, the dollar value allocated to such type of award, by $30.00, the closing price of our common stock on the date prior to the grant date, which equals 416.67. Next, the Compensation Committee would consider the restricted stock with performance-based vesting by dividing $12,500 by $22.50, which is 75% of the closing price of our common stock on the date prior to the grant date, which equals 555.56. The Compensation Committee would then add 416.67 and 555.56, which equals 972.23. Lastly, in order to determine the number of shares to be allocated to each type of award, the Compensation Committee would divide 972.23 by two, which equals 486.12, and would then round up to 487 in order to avoid the issuance of fractional shares. Accordingly, the award would consist of 487 restricted stock units with time-based vesting and 487 restricted stock units with performance-based vesting.

The determination of the amount of restricted stock units to be granted is illustrated as follows:

Time Based

		12,500 ¸ (dollar amount)		=		416.67 units
		30.00 (stock price)
Performance Based
		12,500 (dollar amount)		=		555.56 units
		(30.00 (stock price) x (.75 Discounted Factor)
		Total Units				972.23 units

				å		æ
Restricted Stock Units Awarded				486.12		486.12
				Time Based		Performance Based
				487		487

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Severance Arrangements.  Prior to September 2006, we did not have in place a formalized severance plan structure. In connection with the evaluation of our compensation arrangements, the Compensation Committee and our Board, based upon data compiled by Hewitt and input received from Mr. Speese, determined that it was in our best interests to implement a company-wide severance plan structure, whereby severance benefits would be paid in certain events to members of our executive and senior management, including our named executive officers, and operational level employees.

The Compensation Committee determined that the adoption of a severance plan structure which is competitive with those offered by similarly situated public companies in the retail industry would advance the objectives which the Compensation Committee has established for our executive compensation program by assisting us in recruiting and retaining top-level talent. In addition, the Compensation Committee believed that formalizing our severance practices benefits us by providing us with certainty in terms of our obligations to an eligible executive in the event that our relationship with any such executive is severed.

The Compensation Committee relied in large part upon both data provided by Hewitt, input from Mr. Speese as well as our Human Resources department with respect to the severance practices of similarly situated public companies in the retail industry as well as input from our outside legal counsel in order to determine which events would trigger a payment obligation under the severance plan structure. The selection of the measures used to determine the amounts payable upon the happening of certain events as well as the selection of the types of events which trigger payment, represent the determination by the Compensation Committee and our Board regarding the best position for us to be in should any such event occur in light of the objectives which have been established for our executive compensation program. The severance plan structure also benefits us by virtue of the non-competition, non-solicitation and release provisions in our loyalty agreements, which inure to our benefit in the event that an eligible executive severs employment with us.

As discussed above, as part of its annual review of the amount and mix of total compensation to be paid to our senior executives, including our named executive officers, the Compensation Committee reviews a tally sheet which contains information regarding, among other things, the severance payments to which each named executive officer would be entitled to receive on the occurrence of each event specified pursuant to our severance plan structure, based upon such named executive officer’s proposed compensation for the new fiscal year. The Compensation Committee considers such information a relevant factor in analyzing proposed compensation arrangements, including salary increases, bonus opportunities and grants of long-term incentive awards.

For a more detailed description of the severance arrangements which apply to our named executive officers, you should read the narrative discussion on page 29 of this proxy statement.

Fringe Benefits and Perquisites.  Our named executive officers are eligible to participate in the benefit plans generally available to all of our employees, which include health, dental, life insurance, vision and disability plans, all of which the Compensation Committee believes are commensurate with plans of other similarly situated public companies in the retail industry.

Our named executive officers are also eligible to participate in our 401(k) plan, which represents the only retirement benefit which we provide to our named executive officers. We may make discretionary matching cash contributions to the 401(k) plan in the amount of 50% of the named executive officer’s contributions, up to an amount not to exceed 4% of the named executive officer’s compensation (subject to highly compensated employee limits). In determining such limits, we rely on the recommendations of our Human Resources department, as well as on data provided by Intrust, the administrator of our 401(k) plan, with respect to the practices employed by similarly situated public companies in the retail industry with 401(k) plans which are similar to ours.

In addition, we own and operate a corporate jet for use by management for business purposes. From time to time, the corporate aircraft is available for non-business use to our Chief Executive Officer, President and Chief Operating Officer, Chief Financial Officer, Senior Vice President — General Counsel, Senior Vice President — Operational Services, and Executive Vice President. Use of the corporate aircraft by these executives for non-business use is subject to availability. None of the aforementioned executives is permitted to charter the corporate aircraft for non-business use more than once per calendar quarter, unless such executive first submits a request to our Chief Executive Officer, who must consult with the Chairperson of the Audit Committee in determining whether to approve such additional non-business use. Once a reservation of the corporate aircraft for non-business use is made, the executive must pay to us, in advance, 110% of the estimated total cost of the requested use of the corporate aircraft. If the actual cost for the non-business use of the corporate aircraft exceeds the advance deposit made by the requesting executive, the additional amount is deemed compensation

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for the requesting executive and reflected on hisW-2 earnings statement for the year. During 2006, Mr. Fadel received compensation in the amount of $265 as a result of non-business use of the corporate aircraft.

Our executive compensation program is relatively free of perquisites. The Compensation Committee’s charter requires the approval by the Compensation Committee of all perquisites and other personal benefits awarded to our named executive officers.

The Compensation Committee has determined it is beneficial to offer the above-described fringe benefits and perquisites in order to attract and retain our named executive officers by offering compensation opportunities that are competitive with those offered by similarly situated public companies in the retail industry. In determining the total compensation payable to our named executive officers for a given fiscal year, the Compensation Committee will examine such fringe benefits and perquisites in the context of the total compensation which our named executive officers are eligible to receive. However, given the fact that such fringe benefits and perquisites which are available to our named executive officers represent a relatively insignificant portion of their total compensation, the availability of such items does not materially influence the decisions made by the Compensation Committee with respect to other elements of the total compensation to which our named executive officers are entitled or awarded.

The foregoing discussion describes the compensation objectives and policies which were utilized with respect to our named executive officers during 2006. In the future, as the Compensation Committee continues to review each element of the executive compensation program with respect to our named executive officers, the objectives of our executive compensation program, as well as the methods which the Compensation Committee utilizes to determine both the types and amounts of compensation to award to our named executive officers, may change.

Section 162(m)

In general, Section 162(m) of the Internal Revenue Code imposes a $1,000,000 limit on the amount of compensation we can deduct in any year with respect to our Chief Executive Officer and each of our four other most highly compensated executive officers. The limit does not apply to so-called “performance-based compensation,” which includes compensation attributable to stock options granted pursuant to our 2006 Plan. The Compensation Committee believes that our executive compensation deduction for 2006 will not be affected by the Section 162(m) limitations. Although the Compensation Committee generally seeks to avoid the Section 162(m) deduction limitations, it is possible, depending upon the circumstances, that items of future compensation may be non-deductible due to those limitations.

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COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) ofRegulation S-K with our management and, based upon such review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the proxy statement on Schedule 14A related to the 2007 Annual Meeting of Stockholders, for filing with the Securities and Exchange Commission.

	AUDIT COMMITTEE
	Peter P. Copses, Chairman
	Richard K. Armey
	Mary Elizabeth Burton

COMPENSATION COMMITTEE
J. V. Lentell, Chairman
Peter P. Copses
Michael J. Gade

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SUMMARY COMPENSATION TABLE

Summary of Compensation:		The following table summarizes the compensation earned by our Chairman and Chief Executive Officer, our Chief Financial Officer and the three other most highly compensated executive officers, or our “named executive officers,” in 2006. The table specifically identifies the dollar value of compensation related to 2006 paid to such named executive officers in the form of:

		•  salary, paid in cash;
		•  stock awards, comprised of awards of restricted stock relating to the 2006 fiscal year;
		•  option awards, comprised of awards of options during the 2006 fiscal year and identified based upon the aggregate fair value in dollars of such award;
		•  non-equity plan incentive plan compensation, listing the aggregate dollar value of the awards paid to our named executive officers under our MBO program; and
		•  all other compensation, which includes amounts paid by us to the named executive officers as matching contributions under our 401(k) plan and insurance premiums.

		Our named executive officers were not entitled to receive payments which would be characterized as “Bonus” payments for purposes of the Summary Compensation Table for 2006.
		Based on the fair value of equity awards granted to our named executive officers in 2006 and the base salary of our named executive officers for 2006, “Salary” accounted for approximately 44.6% of the total compensation of our named executive officers while cash bonuses paid to our named executive officers under our MBO program for 2006 accounted for approximately 24.7% of the total compensation of our named executive officers. Because the value of certain equity awards as reflected in the Summary Compensation Table are based on the FAS 123(R) value rather than the fair value, these percentages may not be able to be derived using the amounts reflected in the table below.

Summary Compensation Table for Fiscal Year End December 31, 2006

																		Non-Equity
																		Incentive Plan				All Other
Name and Principal										Stock				Option				Compensation				Compensation				Total
Position		Year				Salary ($)				Awards ($)				Awards ($)				($)				($)				($)
(a)		(b)				(c)				(e)				(f)				(g)				(i)				(j)
Mark E. Speese,			2006				$740,000				—				$1,088,500	(1)			$532,800	(2)			$794	(3)			$2,362,094
Chairman of the Board and Chief Executive Officer
Robert D. Davis,			2006				$335,000				$17,125	(1)			$2,219	(1)			$156,780	(4)			$4,619	(5)			$515,743
Senior Vice President — Finance, Treasurer and Chief Financial Officer
Mitchell E. Fadel,			2006				$510,000				$38,516	(1)			$4,988	(1)			$298,350	(6)			$5,454	(7)			$857,043
President and Chief Operating Officer
Christopher A. Korst,			2006				$280,000				$10,263	(1)			$1,330	(1)			$92,610	(8)			$4,782	(9)			$388,985
Senior Vice President — General Counsel and Secretary
David E. West,			2006				$251,125				$8,591	(1)			$1,109	(1)			$89,953	(10)			$5,390	(11)			$356,168
Senior Vice President — Operational Services

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(1)		This amount reflects the dollar amount recognized for financial statement reporting purposes for our fiscal year ended December 31, 2006, in accordance with FAS 123(R). Assumptions used in the calculation of this amount are included in footnote M to our audited financial statements for the fiscal year ended December 31, 2006 included in our Annual Report onForm 10-K filed with the SEC on March 1, 2007. For a description of such award, please refer to the Grant of Plan-Based Awards Table on page 24 of this proxy statement and the related narrative discussion beginning on page 26 of this proxy statement.
(2)		The Compensation Committee determined it appropriate to award a cash bonus to Mr. Speese for his services to us in 2006, which the Compensation Committee calculated in a substantially similar manner as the cash bonuses which were payable to our other named executive officers under our MBO program for 2006, and assumed that the target cash bonus for Mr. Speese was 60% of his base salary for 2006, or $444,000. The Compensation Committee determined that Mr. Speese’s cash bonus should represent a greater percentage of his 2006 base salary than that paid to our other named executive officers due to the greater influence which Mr. Speese has on our overall operating and financial performance relative to our other named executive officers. Accordingly, Mr. Speese was awarded $532,800, which represented 60% of Mr. Speese’s base salary for 2006, plus an additional $88,800 since we exceeded the adjusted consolidated net income target of $144.9 million.
(3)		Represents $794 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. Speese.
(4)		Pursuant to our MBO program for 2006, the target cash bonus for Mr. Davis was established at 40% of his base salary, or $134,000. Since we achieved the financial performance measure for our MBO program by virtue of the fact that our adjusted consolidated net income for 2006 exceeded $144.9 million, Mr. Davis received 40% of his target cash bonus amount, or $53,600, plus the additional cash bonus equal to 8% of his base salary, or $26,800. In addition, Mr. Speese evaluated Mr. Davis’s performance with respect to the individual goals and objectives within Mr. Davis’s sphere of influence which were established pursuant to our MBO program for 2006. Based on the results of such evaluation, Mr. Speese determined that of the maximum amount of cash bonus that was contingent upon Mr. Davis’s achievement of such individual goals and objectives, Mr. Davis should receive 95% of such amount, or $76,380.
(5)		Represents (1) $4,400 of annual contributions or other allocations by us to our 401(k) Plan and (2) $219 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. Davis.
(6)		Pursuant to our MBO program for 2006, the target cash bonus for Mr. Fadel was established at 50% of his base salary, or $255,000. Since we achieved the financial performance measure for our MBO program by virtue of the fact that our adjusted consolidated net income for 2006 exceeded $144.9 million, Mr. Fadel received 40% of his target cash bonus amount, or $102,000, plus the additional cash bonus equal to 10% of his base salary, or $51,000. In addition, Mr. Speese evaluated Mr. Fadel’s performance with respect to the individual goals and objectives within Mr. Fadel’s sphere of influence which were established pursuant to our MBO program for 2006. Based on the results of such evaluation, Mr. Speese determined that of the maximum amount of cash bonus that was contingent upon Mr. Fadel’s achievement of such individual goals and objectives, Mr. Fadel should receive 95% of such amount, or $145,350.
(7)		Represents (1) $4,395 of annual contributions or other allocations by us to our 401(k) Plan, (2) $794 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. Fadel, and (3) $265 of deemed compensation as a result of non-business use of our corporate aircraft.
(8)		Pursuant to our MBO program for 2006, the target cash bonus for Mr. Korst was established at 30% of his base salary, or $84,000. Since we achieved the financial performance measure for our MBO program by virtue of the fact that our adjusted consolidated net income for 2006 exceeded $144.9 million, Mr. Korst received 40% of his target cash bonus amount, or $33,600, plus the additional cash bonus equal to 6% of his base salary, or $16,800. In addition, Mr. Speese evaluated Mr. Korst’s performance with respect to the individual goals and objectives within Mr. Korst’s sphere of influence which were established pursuant to our MBO program for 2006. Based on the results of such evaluation, Mr. Speese determined that of the maximum amount of cash bonus that was contingent upon Mr. Korst’s achievement of such individual goals and objectives, Mr. Korst should receive 84% of such amount, or $42,210.
(9)		Represents (1) $4,400 of annual contributions or other allocations by us to our 401 (k) Plan and (2) $382 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. Korst.
(10)		Pursuant to our MBO program for 2006, the target cash bonus for Mr. West was established at 30% of his base salary, or $75,338. Since we achieved the financial performance measure for our MBO program by virtue of the fact that our adjusted consolidated net income for 2006 exceeded $144.9 million, Mr. West received 40% of his target cash bonus amount, or $30,135, plus the additional cash bonus equal to 6% of his base salary, or $15,067. In addition, Mr. Speese evaluated Mr. West’s performance with respect to the individual goals and objectives within Mr. West’s sphere of influence which were established pursuant to our MBO program for 2006. Based on the results of such evaluation, Mr. Speese determined that of the maximum amount of cash bonus that was contingent upon Mr. West’s achievement of such individual goals and objectives, Mr. West should receive 99% of such amount, or $44,751.
(11)		Represents (1) $4,400 of annual contributions or other allocations by us to our 401 (k) Plan and (2) $990 of dollar value of insurance premiums paid by, or on behalf of us with respect to life insurance for the benefit of Mr. West.

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Mr. Speese’s EmploymentAgreement:		On October 2, 2006, we entered into a written employment agreement with Mr. Speese. Pursuant to the terms of the employment agreement, Mr. Speese’s compensation consists of (i) an annual base salary of not less than $740,000, subject to upward adjustment based upon the results of an annual review by the Compensation Committee, (ii) an annual bonus opportunity established by the Compensation Committee, (iii) participation in our employee benefit plans for senior executive officers, and (iv) as discussed in greater detail on page 27 of this proxy statement, a one time grant of an option to purchase 70,000 shares of our common stock. In addition, the employment agreement contains severance provisions which provide for certain payments to be made by us to Mr. Speese upon the occurrence of certain events which result in his employment with us being severed, including upon a change in control of us.
		Prior to October 2006, we did not maintain employment agreements or change in control agreements with any of our existing named executive officers. However, in light of the approval by the Compensation Committee and our Board of the severance plan structure for members of our executive and senior management, including our named executive officers other than Mr. Speese, the Compensation Committee determined that our best interests would be served by entering into an employment agreement with Mr. Speese which contained many of the same provisions as the executive transition agreements entered into by our named executive officers under the severance plan structure, but provided additional assurance to us of Mr. Speese’s valuable services. The Compensation Committee determined that the entry into such an employment agreement with Mr. Speese, which contains severance provisions that are competitive with those offered to the highest paid executive at similarly situated public companies, would advance the objectives which the Compensation Committee has established for our executive compensation program by providing Mr. Speese with additional incentives to remain in his position with us. The Compensation Committee believed that formalizing our severance policy with respect to Mr. Speese will benefit us by providing us with certainty in terms of our obligations to Mr. Speese in the event that our relationship with him is severed, as well as provide us with benefits under the loyalty agreement by virtue of the non-competition, non-solicitation and release provisions which inure to our benefit in the event that Mr. Speese’s employment with us is severed. For a detailed description of the severance provisions contained in the employment agreement, please refer to the narrative discussion beginning on page 30 of this proxy statement.

Grants of Plan-Based Awards for Fiscal Year End December 31, 2006⁽¹⁾

																														Exercise								Grant Date
																														or Base				Closing				Fair
						Estimated Future Payouts Under												Estimated Future Payouts Under												Price				Price on				Value of
						Non-Equity Incentive Plan Awards												Equity Incentive Plan Awards												of Option				Grant				Stock
		Grant				Threshold				Target				Maximum				Threshold				Target				Maximum				Awards				Date				and Option
Name		Date				($)				($)				($)				(#)				(#)				(#)				($ / Sh)				($ / Sh)				Awards ($)
(a)		(b)				(c)				(d)				(e)				(f)				(g)				(h)				(k)				(l)
Mark E. Speese							$375,000	(2)			$500,000	(2)			$562,500	(2)			—				—				—				—				—				—
			10/2/06				—				—				—				—				70,000	(3)			—				$29.29	(4)			$28.90				$1,088,500
							$0	(5)			$532,800	(5)			$532,800	(5)			—				—				—				—				—				—
Robert D. Davis			1/31/06				—				—				—				0	(6)			6,805	(6)			9,033	(6)			$19.52	(7)			$20.50				$79,133
							$0	(8)			$134,000	(8)			$160,800	(8)			—				—				—				—				—				—
Mitchell E. Fadel			1/31/06				—				—				—				0	(9)			15,300	(9)			20,310	(9)			$19.52	(7)			$20.50				$177,957
							$0	(10)			$255,000	(10)			$306,000	(10)			—				—				—				—				—				—
Christopher A. Korst			1/31/06				—				—				—				0	(11)			4,080	(11)			5,415	(11)			$19.52	(7)			$20.50				$47,433
							$0	(12)			$84,000	(12)			$100,800	(12)			—				—				—				—				—				—
David E. West			1/31/06				—				—				—				0	(13)			3,405	(13)			4,523	(13)			$19.52	(7)			$20.50				$39,660
							$0	(14)			$75,338	(14)			$90,405	(14)			—				—				—				—				—				—

(1)		There were no grants of stock awards or option awards to our named executive officers during 2006 other than grants pursuant to the Previous Plan or the 2006 Plan.
(2)		Mr. Speese’s award was made on January 31, 2006 pursuant to the Previous Plan and consists of (1) $250,000 which will vest ratably over a four year period ($62,500 on each anniversary date), (2) $125,000 which will vest upon Mr. Speese’s completion of three years of continuous service from January 31, 2006, and (3) $125,000 which will vest upon our

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		achievement of a three-year EBITDA of $1.0998 billion. The award of the cash underlying the performance-based portion of the cash award will range from a minimum of $0 if we achieve less than 87.0% of the target EBITDA up to a maximum of $187,500 if we achieve at least 115.1% of the target EBITDA.
(3)		On October 2, 2006, the Compensation Committee granted Mr. Speese an option to purchase 70,000 shares of our common stock as a bonus for entering into an employment agreement with us. Mr. Speese’s award was made pursuant to the 2006 Plan and is immediately exercisable. However, until the earlier to occur of (1) December 31, 2009, (2) Mr. Speese’s termination of employment with us due to his disability (as defined in his employment agreement), or death, (3) the termination of his employment with us without “cause” or for “good reason” or (4) the day preceding the consummation of a “change in control” (as defined in his employment agreement) of us, Mr. Speese may not sell or otherwise transfer any shares received upon the exercise of such options.
(4)		Calculated by reference to the closing price for shares of our common stock on the Nasdaq Global Select Market on September 29, 2006, in accordance with the 2006 Plan. For additional information with respect to the determination of the exercise price of options awarded pursuant to the 2006 Plan, please refer to the section entitled “Compensation Discussion and Analysis — Forms of Compensation — Long-Term Incentives — Options” beginning on page 16 of this proxy statement.
(5)		The Compensation Committee awarded Mr. Speese a cash bonus in the amount of $532,800 for 2006. For additional information with respect to the cash bonus awarded to Mr. Speese, please refer to footnote #2 to the Summary Compensation Table on page 22 of this proxy statement.
(6)		Mr. Davis’s award was made on January 31, 2006 pursuant to the Previous Plan and consists of (1) 5,320 options to purchase shares of our common stock, which vest ratably over a four-year period and each of which have an exercise price of $19.52 per share, (2) 1,485 restricted stock units which vest upon Mr. Davis’s completion of three-years of continuous employment with us from January 31, 2006, and (3) 1,485 restricted stock units which vest upon our achievement of a three-year EBITDA of $1.0998 billion. The issuance of the stock underlying the performance-based restricted stock units granted to Mr. Davis will range from a minimum of zero shares if we achieve less than 87.0% of the target EBITDA, to a maximum of 2,228 shares if we achieve at least 115.1% of the target EBITDA. The amount reflected in the “target” column does not include 1,485 restricted stock units which vest upon Mr. Davis’s completion of three years of continuous employment with us from January 31, 2006.
(7)		With respect to the options awarded to Messrs. Davis, Fadel, Korst and West, the exercise price of $19.52 represented the Compensation Committee’s determination of the fair market value for our common stock on January 31, 2006, as determined pursuant to the Previous Plan. Such determination was calculated based upon a30-day average of the closing price for shares of our common stock on the Nasdaq Global Select Market through January 25, 2006, which formula was based upon the recommendations of Hewitt, the Compensation Committee’s executive compensation consulting firm.
(8)		Pursuant to our MBO program for 2006, the target cash bonus for Mr. Davis was established at $134,000 and Mr. Davis was entitled to receive an additional cash bonus in the amount of $26,800 in the event that we exceeded our adjusted consolidated net income target of $144.9 million for 2006.
(9)		Mr. Fadel’s award was made on January 31, 2006 pursuant to the Previous Plan and consists of (1) 11,960 options to purchase shares of our common stock, which vest ratably over a four-year period and each of which have an exercise price of $19.52 per share, (2) 3,340 restricted stock units which vest upon Mr. Fadel’s completion of three-years of continuous employment with us from January 31, 2006, and (3) 3,340 restricted stock units which vest upon our achievement of a three-year EBITDA of $1.0998 billion. The issuance of the stock underlying the performance-based restricted stock units granted to Mr. Fadel will range from a minimum of zero shares if we achieve less than 87.0% of the target EBITDA, to a maximum of 5,010 shares if we achieve at least 115.1% of the target EBITDA. The amount reflected in the “target” column does not include 3,340 restricted stock units which vest upon Mr. Fadel’s completion of three years of continuous employment with us from January 31, 2006.
(10)		Pursuant to our MBO program for 2006, the target cash bonus for Mr. Fadel was established at $255,000 and Mr. Fadel was entitled to receive an additional cash bonus in the amount of $51,000 in the event that we exceeded our adjusted consolidated net income target of $144.9 million for 2006.
(11)		The amount reflected in the “target” column does not include 890 restricted stock units which vest upon Mr. Korst’s completion of three years of continuous employment with us from January 31, 2006. Mr. Korst’s award was made on January 31, 2006 pursuant to the Previous Plan and consists of (1) 3,190 options to purchase shares of our common stock, which vest ratably over a four-year period and each of which have an exercise price of $19.52 per share, (2) 890 restricted stock units which vest upon Mr. Korst’s completion of three-years of continuous employment with us from January 31, 2006, and (3) 890 restricted stock units which vest upon our achievement of a three-year EBITDA of $1.0998 billion. The issuance of the stock underlying the performance-based restricted stock units granted to Mr. Korst will range from a minimum of zero shares if we achieve less than 87.0% of the target EBITDA, to a maximum of 1,335 shares if we achieve at least 115.1% of the target EBITDA. The amount reflected in the “target” column does not include 890 restricted stock units which vest upon Mr. Korst’s completion of three years of continuous employment with us from January 31, 2006.
(12)		Pursuant to our MBO program for 2006, the target cash bonus for Mr. Korst was established at $84,000 and Mr. Korst was entitled to receive an additional cash bonus in the amount of $16,800 in the event that we exceeded our adjusted consolidated net income target of $144.9 million for 2006.

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(13)		Mr. West’s award was made on January 31, 2006 pursuant to the Previous Plan and consists of (1) 2,660 options to purchase shares of our common stock, which vest ratably over a four-year period and each of which have an exercise price of $19.52 per share, (2) 745 restricted stock units which vest upon Mr. West’s completion of three-years of continuous employment with us from January 31, 2006, and (3) 745 restricted stock units which vest upon our achievement of a three-year EBITDA of $1.0998 billion. The issuance of the stock underlying the performance-based restricted stock units granted to Mr. West will range from a minimum of zero shares if we achieve less than 87.0% of the target EBITDA, to a maximum of 1,118 shares if we achieve at least 115.1% of the target EBITDA. The amount reflected in the “target” column does not include 745 restricted stock units which vest upon Mr. West’s completion of three years of continuous employment with us from January 31, 2006.
(14)		Pursuant to our MBO program for 2006, the target cash bonus for Mr. West was established at $75,338 and Mr. West was entitled to receive an additional cash bonus in the amount of $15,067 in the event that we exceeded our adjusted consolidated net income target of $144.9 million for 2006.

		The following is a narrative discussion of the material factors which we believe are necessary to understand the information disclosed in the foregoing Grant of Plan-Based Awards Table. On January 31, 2006, the Compensation Committee approved the issuance of a long-term incentive award to each of Messrs. Davis, Fadel, Korst, West and Speese under the Previous Plan.
January 2006 Long-Term Incentive Awards:		Messrs. Davis, Fadel, Korst and West.  With respect to the long-term incentive awards granted to Messrs. Davis, Fadel, Korst and West, the Compensation Committee determined that our best interests would be advanced by encouraging and enabling such named executive officers who are in large part responsible for our management, growth and success, to acquire shares of our common stock and to become eligible to receive certain long-term incentive awards, thus assuring a closer identification of their interests with ours. The Compensation Committee believed that the acquisition of such an interest in us would stimulate the endeavors of Messrs. Davis, Fadel, Korst and West on our behalf and strengthen their desires to remain with us. Accordingly, the Compensation Committee determined that long-term incentive awards granted to Messrs. Davis, Fadel, Korst and West should be in the form of options to purchase shares of our common stock, which options will vest ratably over a four-year period, as well as restricted stock units, with half of such restricted stock units vesting upon the completion of three-years of continuous employment with us from January 31, 2006, and the other half of such restricted stock units vesting upon our achievement of a three-year EBITDA of $1.0998 billion. With respect to the options awarded to Messrs. Davis, Fadel, Korst and West, the exercise price of $19.52 represented the Compensation Committee’s determination of the fair market value for our common stock on January 31, 2006, as required pursuant to the Previous Plan. Such determination was calculated based upon a30-day average of the closing price for shares of our common stock on the Nasdaq Global Select Market through January 25, 2006, which formula was based upon the recommendations of Hewitt.
		Mark E. Speese.  Given Mr. Speese’s significant ownership of our common stock, the Compensation Committee determined at that time that such long-term incentive award granted to Mr. Speese should be a cash award, containing substantially the same vesting schedule and requirements as those of the long-term incentive equity awards granted to Messrs. Fadel, Davis, Korst and West and described in greater detail below. The dollar amount of the award, the allocation of such dollar amounts to each vesting requirement and the basis for selecting the dollar amounts allocated to each of the vesting requirements were determined based upon data compiled by Hewitt with respect to similar awards paid to the highest paid executive at similarly situated public companies in the retail industry. On October 2, 2006, the Compensation Committee granted Mr. Speese an option to purchase 70,000 shares of our common stock under the 2006 Plan as a bonus for entering into an employment agreement with us. Pursuant to the terms of the option agreement underlying that award, Mr. Speese was granted the option to purchase 70,000 shares of our common stock at an exercise price of $29.29, which was calculated by reference to the closing price for shares of our common stock on the Nasdaq Global Select Market on September 29, 2006, in accordance with the 2006 Plan. For additional information with respect to the determination of the exercise price of options awarded pursuant to the 2006 Plan, please refer to the section entitled “Compensation Discussion

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		and Analysis — Forms of Compensation — Long-Term Incentives — Options” beginning on page 16 of this proxy statement.
October 2006 Long-Term Incentive Award:		The Compensation Committee relied upon input from senior financial management concerning valuation and the number of shares of our common stock underlying such option so that the total value of the option was equal to approximately $1,000,000, which generally approximates the average annual salary and cash bonus paid to Mr. Speese over the previous few years. Although the Compensation Committee considered granting Mr. Speese options which would vest based on our achievement of certain performance-based measures, the Compensation Committee ultimately determined that it would be more beneficial to us and our stockholders to grant Mr. Speese options in connection with the employment agreement which vest immediately, but restrict him from selling the underlying shares of our common stock until the employment agreement expires in order to realize the full value of such award.

Outstanding Equity Awards at Fiscal Year End December 31, 2006

Stock Awards

Equity

Equity

Incentive

Incentive

Option Awards

Plan

Plan

Equity

Awards:

Awards:

Incentive

Number of

Market or

Plan

Unearned

Payout Value

Number of

Number of

Awards:

Shares,

of Unearned

Securities

Securities

Number of

Units or

Shares, Units

Underlying

Underlying

Securities

Other

or Other

Unexercised

Unexercised

Underlying

Option

Rights That

Rights That

Options

Options

Unexercised

Exercise

Option

Have Not

Have Not

(#)

(#)

Unearned

Price

Expiration

Vested

Vested

Name

Exercisable

Unexercisable

Options (#)

($)

Date

(#)

($)

(a)

(b)

(c)

(d)

(e)

(f)

(i)

(j)

Mark E. Speese

22,500

$13.075

1/2/2011

500,000

$10.396

11/9/2011

70,000

$29.29

10/2/2016

Robert D. Davis

50,000

$10.396

11/9/2011

5,320

(1)

$19.52

1/31/2016

��

2,970

(2)

$87,645

(3)

Mitchell E. Fadel

12,500

$7.925

12/31/2009

87,500

$8.95

7/24/2010

250,001

$10.396

11/9/2011

11,960

(4)

$19.52

1/31/2016

6,680

(5)

$197,127

(3)

Christopher A. Korst

43,750

75,000

(6)

$18.50

7/12/2011

3,190

(7)

$19.52

1/31/2016

$17.80

(8)

$52,528

(3)

David E. West

3,125

$7.15

10/1/2009

3,125

$7.925

12/31/2009

5,000

$29.38

1/2/2014

5,000

(9)

$29.38

1/2/2014

2,660

(10)

$19.52

1/31/2016

1,490

(11)

43,970

(3)

(1)		On January 31, 2006, Mr. Davis was granted options to purchase shares of our common stock pursuant to the Previous Plan. 1,330 of these options vested on January 31, 2007 and the remaining 3,990 options vest in equal amounts on each of January 31, 2008, January 31, 2009 and January 31, 2010.
(2)		These restricted stock units were granted to Mr. Davis on January 31, 2006 pursuant to the Previous Plan and consist of (1) 1,485 restricted stock units which vest upon Mr. Davis’ completion of three-years of continuous employment with us from January 31, 2006, and (2) 1,485 restricted stock units which vest upon our achievement of a three-year EBITDA of $1.0998 billion. The issuance of the stock underlying the performance-based restricted stock units granted to Mr. Davis will range from a minimum of zero shares if we achieve less than 87.0% of the target EBITDA, to a maximum of 2,228 shares if we achieve at least 115.1% of the target EBITDA.

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(3)		Calculated by reference to the closing price for shares of our common stock on the Nasdaq Global Select Market on December 29, 2006, which was $29.51.
(4)		On January 31, 2006, Mr. Fadel was granted options to purchase shares of our common stock pursuant to the Previous Plan. 2,990 of these options vested on January 31, 2007 and the remaining 8,970 options vest in equal amounts on each of January 31, 2008, January 31, 2009 and January 31, 2010.
(5)		These restricted stock units were granted to Mr. Fadel on January 31, 2006 pursuant to the Previous Plan and consist of (1) 3,340 restricted stock units which vest upon Mr. Fadel’s completion of three-years of continuous employment with us from January 31, 2006, and (2) 3,340 restricted stock units which vest upon our achievement of a three-year EBITDA of $1.0998 billion. The issuance of the stock underlying the performance-based restricted stock units granted to Mr. Fadel will range from a minimum of zero shares if we achieve less than 87.0% of the target EBITDA, to a maximum of 5,010 shares if we achieve at least 115.1% of the target EBITDA.
(6)		These options were granted to Mr. Korst under the Previous Plan and will gradually vest upon the enactment of legislation in certain states in which we conduct business.
(7)		On January 31, 2006, Mr. Korst was granted options to purchase shares of our common stock pursuant to the Previous Plan. 797 of these options vested on January 31, 2007 and the remaining 2,393 options vest in equal amounts on each of January 31, 2008, January 31, 2009 and January 31, 2010.
(8)		These restricted stock units were granted to Mr. Korst on January 31, 2006 pursuant to the Previous Plan and consist of (1) 890 restricted stock units which vest upon Mr. Korst’s completion of three-years of continuous employment with us from January 31, 2006, and (2) 890 restricted stock units which vest upon our achievement of a three-year EBITDA of $1.0998 billion. The issuance of the stock underlying the performance-based restricted stock units granted to Mr. Korst will range from a minimum of zero shares if we achieve less than 87.0% of the target EBITDA, to a maximum of 1,335 shares if we achieve at least 115.1% of the target EBITDA.
(9)		On January 2, 2004, Mr. West was granted options to purchase shares of our common stock pursuant to the Previous Plan. 2,500 of these options vested on January 2, 2007 and the remaining 2,500 options vest on January 2, 2008.
(10)		On January 31, 2006, Mr. West was granted options to purchase shares of our common stock pursuant to the Previous Plan. 665 of these options vested on January 31, 2007 and the remaining 1,995 options vest in equal amounts on each of January 31, 2008, January 31, 2009 and January 31, 2010.
(11)		These restricted stock units were granted to Mr. West on January 31, 2006 pursuant to the Previous Plan and consist of (1) 745 restricted stock units which vest upon Mr. West’s completion of three-years of continuous employment with us from January 31, 2006, and (2) 745 restricted stock units which vest upon our achievement of a three-year EBITDA of $1.0998 billion. The issuance of the stock underlying the performance-based restricted stock units granted to Mr. West will range from a minimum of zero shares if we achieve less than 87.0% of the target EBITDA, to a maximum of 1,118 shares if we achieve at least 115.1% of the target EBITDA.

Options Exercised and Stock Vested in 2006⁽¹⁾

		Option Awards
		Number of Shares				Value
		Acquired				Realized
		on				On
		Exercise				Exercise
Name		(#)				($)
Mark E. Speese			—				—
Robert D. Davis			—				—
Mitchell E. Fadel			25,000				$556,200	(2)
Christopher A. Korst			—				—
David E. West			—				—

(1)		None of our executive officers held any stock award that vested during 2006.
(2)		This amount reflects the difference between the exercise price of the options, which was $5.752, and the closing price of $28.00 for our common stock on the Nasdaq Global Select Market on May 11, 2006, the date on which the options were exercised by Mr. Fadel.

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TERMINATION OF EMPLOYMENT ANDCHANGE-IN-CONTROL ARRANGEMENTS

Severance Arrangements:		On September 19, 2006, we entered into executive transition agreements with each of our named executive officers, other than Mr. Speese. Please see “Compensation Discussion and Analysis — Forms of Compensation — Severance Arrangements,” beginning on page 19 of this proxy statement for a discussion of our reasons for entering into such arrangements. Each executive transition agreement has substantially identical terms and is intended to provide certain payments and benefits upon an involuntary termination of the named executive officer’s employment or the occurrence of certain other circumstances that may affect the named executive officer.
		Termination Not in Conjunction With a Change In Control.  If the named executive officer’s employment is terminated without “cause,” the named executive officer will be entitled to receive:

		•  unpaid but earned base salary through the date of termination;
		•  a pro rata bonus calculated based upon the named executive officer’s bonus amount from the previous year;
		•  one and one half times the sum of the named executive officer’s highest annual rate of salary during the previous 24 months, and the named executive officer’s average annual bonus for the two preceding calendar years; and
		•  continued health insurance coverage for the named executive officer and the named executive officer’s spouse and covered dependents for up to 18 months.

		If the named executive officer’s employment is terminated due to disability or death, the named executive officer will be entitled to receive:

		•  unpaid but earned base salary through the date of termination;
		•  a pro rata bonus calculated based upon the named executive officer’s bonus amount from the previous year; and
		•  continued health insurance coverage for the named executive officer and the named executive officer’s spouse and covered dependents for 12 months.

		If the named executive officer’s employment is terminated for “cause” or if the named executive officer terminates his employment for any reason other than death, the named executive officer will be entitled to receive his unpaid but earned base salary through the date of termination (reduced by amounts owed by the named executive officer to us or our affiliates).
		Termination in Conjunction With a Change In Control.  If the named executive officer’s employment is terminated in conjunction with a change in control of us without “cause” or by the named executive officer for “good reason,” the named executive officer will be entitled to receive the same severance payments and benefits as described above (not in connection with a change in control) with respect to a termination without “cause,” except that the named executive officer will be entitled to receive two times the sum of the named executive officer’s highest annual rate of salary during the previous 24 months, and the named executive officer’s average annual bonus for the two preceding calendar years, rather than one and one half times such amount, and the named executive officer will be entitled to continued health insurance coverage for up to two years, rather than 18 months. If the named executive officer’s employment is terminated in connection with a change in control due to disability or death, or for “cause” or without “good reason,” the named executive officer will be entitled to receive the same severance payments and benefits as described above (not in connection with a change in control) with respect to a termination due to disability or death or for “cause,” respectively.

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		Under each of the executive transition agreements, the term “change in control” generally means the occurrence of any of the following after September 14, 2006:

		•  any person becomes the beneficial owner of 40% or more of the combined voting power of our then outstanding voting securities;
		•  a consolidation, merger or reorganization of us, unless (i) our stockholders immediately prior to such transaction own at least a majority of the voting power of the outstanding voting securities of the resulting entity, (ii) the members of our Board immediately prior to the execution of the agreement providing for such a transaction constitute a majority of the board of directors of the surviving corporation or of its majority stockholder, and (iii) no person beneficially owns more than 40% of the combined voting power of the then outstanding voting securities of the surviving corporation (other than a person who is (a) us or a subsidiary of us, (b) an employee benefit plan maintained by us, the surviving corporation or any subsidiary, or (c) the beneficial owner of 40% or more of the combined voting power of our outstanding voting securities immediately prior to such transaction;
		•  individuals who, as of September 14, 2006, constitute our entire Board cease to constitute a majority of our Board, provided that anyone who later becomes a director and whose appointment or nomination for election was approved by at least two-thirds of our directors at the time shall be considered as though such individual were a member of our Board;
		•  approval by our stockholders of a complete liquidation or dissolution of us, or a sale or other disposition of all or substantially all of our assets (other than to an entity described in the second bullet point above); or
		•  any other event or transaction which our Board, acting in its discretion, designates is a change in control.

Employment Agreement:		Pursuant to Mr. Speese’s employment agreement, if we terminate Mr. Speese’s employment due to his disability or death, Mr. Speese will be entitled to receive:

		•  unpaid but earned base salary through the date of termination;
		•  a pro rata bonus calculated based upon Mr. Speese’s bonus amount from the previous year; and
		•  continued health insurance coverage for Mr. Speese and Mr. Speese’s spouse and covered dependents for 12 months.

		If we terminate Mr. Speese’s employment for “cause,” or if Mr. Speese terminates his employment with us for any reason other than death or for “good reason,” Mr. Speese will be entitled to receive his unpaid but earned base salary through the date of termination (reduced by amounts owed by Mr. Speese to us or our affiliates). If Mr. Speese’s employment is terminated by us without “cause” (as defined in the employment agreement) or by Mr. Speese for “good reason,” Mr. Speese will be entitled to receive:

		•  unpaid but earned base salary through the date of termination;
		•  a pro rata bonus calculated based upon Mr. Speese’s bonus amount from the previous year;
		•  two times the sum of Mr. Speese’s highest annual rate of salary during the previous 24 months, and Mr. Speese’s average annual bonus for the two preceding calendar years; and
		•  continued health insurance coverage for Mr. Speese and Mr. Speese’s spouse and covered dependents for up to 24 months.

		If we terminate Mr. Speese’s employment in conjunction with a change in control of us without “cause” or if Mr. Speese terminates his employment with us for “good reason,” Mr. Speese will be entitled to receive in a lump sum the same aggregate severance payments and benefits as described above for a termination not in connection with a

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		change in control, except that in addition to such amounts, Mr. Speese will be entitled to continued health insurance coverage for himself and his spouse and covered dependents for 36 months, rather than 24 months. The amount of the severance payments will be reduced if and to the extent necessary to avoid the loss of a tax deduction by us under Section 280G of the Internal Revenue Code and the imposition of an excise tax on Mr. Speese pursuant to Section 4999 of the Internal Revenue Code. The Compensation Committee or the Board may condition the payment of severance or benefits on the execution and delivery by Mr. Speese of a general release in favor of us, our affiliates and our officers, directors, and employees, provided that no such release will be required for the payment to Mr. Speese of accrued compensation.
Awards Pursuant to the Previous Plan:		Stock Option Agreements.  When Messrs. Speese, Davis, Fadel, Korst and West were awarded options under the Previous Plan, each of them entered into a stock option agreement with us. Each agreement provides that, if the individual’s employment with us is terminated because of death or disability, any options that are vested and exercisable on the date of termination will remain exercisable for 12 months thereafter, but not beyond the term of the agreement. If the individual’s employment is terminated by us for “cause,” then the options (whether or not then vested and exercisable) will immediately terminate and cease to be exercisable. If the individual’s employment with us is terminated for any other reason, any options that are vested and exercisable as of the date of termination will remain exercisable for three months thereafter, but not beyond the term of the agreement. Lastly, in the event of a corporate merger, consolidation, acquisition of property or stock, separation, reorganization or liquidation, the Compensation Committee may accelerate the exercisability of, or lapse of restrictions with respect to, options and the termination of unexercised options.
		Stock Compensation Agreements.  When Messrs. Davis, Fadel, Korst and West were awarded restricted stock units on January 31, 2006 under the Previous Plan, each of them entered into a stock compensation agreement with us. Each agreement provides that, if the individual’s employment with us is terminated because of death or disability, or there is a change in ownership of us, then any unvested restricted stock units will vest on the date of such termination of employment or immediately prior to the consummation of the change in ownership of us, as the case may be. However, any unvested restricted stock units do not vest by reason of a change in ownership unless the individual remains continuously employed by us until such change in ownership is complete or the individual’s employment is sooner terminated by us in connection with such change in ownership. In addition, upon the termination of the individual’s employment or other service with us for any reason other than disability or death, any unvested restricted stock units will thereupon terminate and be canceled.
		Under each of the stock compensation agreements, the term “change in ownership” is defined as any transaction or series of transactions as a result of which any one person or group of persons acquires (i) ownership of our common stock that, together with the common stock previously held by such person, constitutes more than 50% of the total fair market value or total voting power of such stock, or (ii) ownership of our assets having a total gross fair market value at least equal to 80% of the total gross fair market value of all of the assets immediately prior to such transaction or series of transactions.
		Long-Term Incentive Cash Award Agreement.  When Mr. Speese was granted a cash award on January 31, 2006 under the Previous Plan, he entered into a long-term incentive cash award agreement with us. Such agreement contains provisions with respect to the vesting of such cash award which are substantially similar to those contained in the above-described stock compensation agreements.
Awards Pursuant to the 2006 Plan:		Pursuant to the 2006 Plan, each holder of an option to purchase shares of our common stock may exercise such option immediately prior to an “exchange transaction,” and any outstanding options not exercised before the exchange transaction shall terminate. However, if, as part of an exchange transaction, our stockholders receive capital stock of another corporation in exchange for our common stock, and if our Board so directs, then

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		all outstanding options shall be converted into options to purchase shares of such stock, with the amount and price to be determined by adjusting the amount and price of the options granted under the 2006 Plan on the same basis as the determination of the number of shares of exchange stock the holders of our outstanding common stock are entitled to receive in the exchange transaction. In addition, unless our Board determines otherwise, the vesting conditions with respect to the converted options shall be substantially the same as those set forth in the original option agreement. The Board may accelerate the vesting of stock awards and other awards, provide for cash settlement ofand/or make such other adjustments to any outstanding award as it deems appropriate in the context of an exchange transaction.
		Under the 2006 Plan, the term “exchange transaction” means a merger (other than in which the holders of our common stock immediately prior thereto have the same proportionate ownership of common stock in the surviving corporation immediately thereafter), consolidation, acquisition or disposition of property or stock, separation, reorganization (other than a reincorporation or the creation of a holding company), liquidation of us or any other similar transaction or event so designated by our Board, as a result of which our stockholders receive cash, stock or other property in exchange for or in connection with their shares of our common stock.
		Stock Option Agreement.  When Mr. Speese was awarded options under the 2006 Plan in October 2006, he entered into a stock option agreement with us. This agreement provides that if Mr. Speese’s employment or other service with us is terminated due to his death or disability, or if he dies after the termination of his employment and before the underlying option expires, then such option shall remain exercisable for 12 months thereafter, but not beyond the stated term. If Mr. Speese’s employment or other service with us terminates for any other reason, then the underlying option shall remain exercisable for three months thereafter (or until one year from his death if he dies during such three-month period), but in no event beyond the stated term.
Potential Payments and Benefits UponTermination Withouta Change in Control:		The following table provides quantitative disclosure of the estimated payments that would be made to our named executive officers under their employment agreement or severance agreements, as well as the amounts our named executive officers would receive upon the exercise of the equity and cash awards held by them on December 29, 2006, the last business day of our fiscal 2006, assuming that:

		•  each named executive officer’s employment with us was terminated on December 29, 2006, and was not in connection with an event which constituted a “change in control” or an “exchange transaction” under any agreement or plan described above;
		•  the base salary earned by each named executive officer for his services to us through December 29, 2006 has been fully paid to such named executive officer;
		•  to the extent not otherwise terminated in connection with the named executive officer’s termination, each of our named executive officers exercised any previously unexercised options and sold the underlying shares at the closing price for shares of our common stock on the Nasdaq Global Select Market on December 29, 2006, which was $29.51; and
		•  to the extent not otherwise terminated in connection with the named executive officer’s termination, each of our named executive officers sold the shares of our common stock underlying their previously unvested restricted stock units at the closing price for shares of our common stock on the Nasdaq Global Select Market on December 29, 2006.

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						Continuation of				Acceleration and
						Medical Benefits				Continuation of
		Cash Severance				(present value)				Outstanding				Total Termination
		Payment ($)				($)				Awards ($)				Benefits ($)
Mark E. Speese
• Termination by Us Without “Cause” or by Mr. Speese for “Good Reason”		$	2,033,500			$	19,874			$	9,942,187			$	11,995,561
• Termination by Us for “Cause”		$	0			$	0			$	0			$	0
• Termination by Us Due to Mr. Speese’s Disability or Death		$	205,500			$	9,937			$	10,442,187			$	10,657,624
• Termination by Mr. Speese for Reason other than Death or “Good Reason”		$	0			$	0			$	9,942,187			$	9,942,187
Robert D. Davis
• Termination by Us Without “Cause”		$	646,688			$	14,906			$	955,700			$	1,617,294
• Termination by Us for “Cause”		$	0			$	0			$	0			$	0
• Termination by Us Due to Mr. Davis’s Disability or Death		$	61,950			$	9,937			$	1,043,345			$	1,115,232
• Termination by Mr. Davis for Reason Other Than Death		$	0			$	0			$	955,700			$	955,700
Mitchell E. Fadel
• Termination by Us Without “Cause”		$	1,022,325			$	14,906			$	6,847,332			$	7,884,563
• Termination by Us for “Cause”		$	0			$	0			$	0			$	0
• Termination by Us Due to Mr. Fadel’s Disability or Death		$	110,400			$	9,937			$	7,044,459			$	7,164,796
• Termination by Mr. Fadel for Reason Other Than Death		$	0			$	0			$	6,847,332			$	6,847,332
Christopher A. Korst
• Termination by Us Without “Cause”		$	522,216			$	14,906			$	481,688			$	1,018,810
• Termination by Us for “Cause”		$	0			$	0			$	0			$	0
• Termination by Us Due to Mr. Korst’s Disability or Death		$	43,837			$	9,937			$	534,216			$	587,990
• Termination by Mr. Korst for Reason Other Than Death		$	0			$	0			$	481,688			$	481,688
David E. West
• Termination by Us Without “Cause”		$	471,773			$	14,906			$	137,978			$	624,657
• Termination by Us for “Cause”		$	0			$	0			$	0			$	0
• Termination by Us Due to Mr. West’s Disability or Death		$	41,895			$	9,937			$	181,948			$	233,780
• Termination by Mr. West for Reason Other Than Death		$	0			$	0			$	137,978			$	137,978

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Potential Payments and Benefits UponTermination With aChange in Control:		The following table provides quantitative disclosure of the estimated payments that would be made to our named executive officers under their employment agreement or severance agreements, as well as the amounts our named executive officers would receive upon the exercise of the equity and cash awards held by them on December 29, 2006, the last business day of our fiscal 2006, assuming that:
		• each named executive officer’s employment with us was terminated on December 29, 2006, and was in connection with an event which constituted a “change in control” or an “exchange transaction” under any agreement or plan described above;
		• the base salary earned by each named executive officer for his services to us through December 29, 2006 has been fully paid to such named executive officer;
		• with respect to options awarded pursuant to the Previous Plan, the Compensation Committee accelerated the exercisability of, or lapse of restrictions with respect to, such options;
		• with respect to options awarded pursuant to the 2006 Plan, the Board does not direct such outstanding options to be converted into options to purchase shares of the exchange stock;
		• to the extent not otherwise terminated in connection with the named executive officer’s termination, each of our named executive officers exercised any previously unexercised options and sold the underlying shares at the closing price for shares of our common stock on the Nasdaq Global Select Market on December 29, 2006; and
		• to the extent not otherwise terminated in connection with the named executive officer’s termination, each of our named executive officers sold the shares of our common stock underlying their previously unvested restricted stock units at the closing price for shares of our common stock on the Nasdaq Global Select Market on December 29, 2006.

						Continuation of				Acceleration and
						Medical Benefits				Continuation of
		Cash Severance				(present value)				Outstanding				Total Termination
		Payment ($)				($)				Awards ($)				Benefits ($)
Mark E. Speese
• Termination by Us Without “Cause” or by Mr. Speese for “Good Reason”		$	2,033,500			$	29,811			$	10,442,187			$	12,505,498
• Termination by Us Due to Mr. Speese’s Disability or Death		$	205,500			$	9,937			$	10,442,187			$	10,657,624
• Termination by Us for “Cause” or by Mr. Speese Without “Good Reason”		$	0			$	0			$	10,442,187			$	10,442,187
Robert D. Davis
• Termination by Us Without “Cause” or by Mr. Davis for “Good Reason”		$	841,600			$	19,874			$	1,096,492			$	1,957,996
• Termination by Us Due to Mr. Davis’s Disability or Death		$	61,950			$	9,937			$	1,096,492			$	1,168,379
• Termination by us for “Cause” or by Mr. Davis Without “Good Reason”		$	0			$	0			$	1,096,492			$	1,096,492

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						Continuation of				Acceleration and
						Medical Benefits				Continuation of
		Cash Severance				(present value)				Outstanding				Total Termination
		Payment ($)				($)				Awards ($)				Benefits ($)
Mitchell E. Fadel
• Termination by Us Without “Cause” or by Mr. Fadel for “Good Reason”		$	1,326,300			$	19,874			$	7,163,940			$	8,510,114
• Termination by Us Due to Mr. Fadel’s Disability or Death		$	110,400			$	9,937			$	7,163,940			$	7,284,277
• Termination by us for “Cause” or by Mr. Fadel Without “Good Reason”		$	0			$	0			$	7,163,940			$	7,163,940
Christopher A. Korst
• Termination by Us Without “Cause” or by Mr. Korst for “Good Reason”		$	681,675			$	19,874			$	1,391,832			$	2,093,381
• Termination by Us Due to Mr. Korst’s Disability or Death		$	43,837			$	9,937			$	1,391,832			$	1,445,606
• Termination by us for “Cause” or by Mr. Korst Without “Good Reason”		$	0			$	0			$	1,391,832			$	1,391,832
David E. West
• Termination by Us Without “Cause” or by Mr. West for “Good Reason”		$	615,065			$	19,874			$	209,172			$	844,111
• Termination by Us Due to Mr. West’s Disability or Death		$	41,895			$	9,937			$	209,172			$	261,004
• Termination by us for “Cause” or by Mr. West Without “Good Reason”		$	0			$	0			$	209,172			$	209,172

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Potential Realizable Value of Outstanding Awards Upon a Change in Control Without Termination:		Under both the Previous Plan and the 2006 Plan, in the event of a “change in control” of us or an “exchange transaction” involving us, the vesting of outstanding awards may be accelerated regardless of whether the employment of the holder is terminated in connection therewith. The following table provides quantitative disclosure of the potential realizable value of outstanding awards granted to our named executive officers pursuant to the Previous Plan and the 2006 Plan assuming that:

		•  an event which constituted a “change in control” and an “exchange transaction” under each of the agreements and plans described above was consummated on December 29, 2006;
		•  with respect to options awarded pursuant to the Previous Plan, the Compensation Committee accelerated the exercisability of, or lapse of restrictions with respect to, such options;
		• with respect to options awarded pursuant to the 2006 Plan, the Board does not direct such outstanding options to be converted into options to purchase shares of the exchange stock;
		•  each named executive officer exercised any previously unexercised options and sold the underlying shares at the closing price for shares of our common stock on the Nasdaq Global Select Market on December 29, 2006; and
		•  each named executive officer sold the shares of our common stock underlying their previously unvested restricted stock units at the closing price for shares of our common stock on the Nasdaq Global Select Market on December 29, 2006.

		Potential Realizable Value(1)
Mark E. Speese			$10,442,187
Robert D. Davis			$1,096,492
Mitchell E. Fadel			$7,163,940
Christopher A. Korst			$1,391,832
David E. West			$209,172

(1)		Calculated by reference to the closing price for shares of our common stock on The Nasdaq Global Select Market on December 29, 2006, the last business day of fiscal 2006, which was $29.51.

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DIRECTOR COMPENSATION⁽¹⁾

		Fees Earned or
		Paid in Cash				Option Awards				Total
Name		($)(2)				($)(3)				($)
Richard K. Armey(4)		$	38,000			$	48,650	(5)			$86,650
Laurence M. Berg(6)		$	40,000			$	48,650	(7)			$88,650
Mary Elizabeth Burton		$	54,500			$	48,650	(8)			$103,150
Peter P. Copses		$	54,000			$	48,650	(9)			$102,650
Michael J. Gade		$	55,000			$	87,570	(10)			$142,570
J.V. Lentell		$	65,500			$	48,650	(11)			$114,150
Leonard H. Roberts		$	10,000				-0-	(12)			$10,000

(1)		During 2006, we did not (1) make any stock awards to our directors, (2) award any non-equity incentive plan compensation to our directors, or (3) maintain any pension or nonqualified deferred compensation arrangements for our directors. Jeffery M. Jackson was appointed to our Board on March 14, 2007 and, accordingly, did not receive any compensation during 2006 and does not appear in this table.
(2)		Represents (1) the annual retainer of $30,000, payable in quarterly installments and (2) compensation for the director’s attendance at Board and committee meetings.
(3)		The amounts in this column reflect the dollar amount recognized for financial statement reporting purposes for our fiscal year ended December 31, 2006, in accordance with FAS 123(R). Assumptions used in the calculation of these amounts are included in footnote M to our audited financial statements for the fiscal year ended December 31, 2006 included in our Annual Report onForm 10-K filed with the SEC on March 1, 2007. Because each of the options awarded to our directors during 2006 were fully vested on the date of grant, the grant date fair value of such options is equal to the amount recognized for financial statement reporting purposes for our fiscal year ended December 31, 2006. On January 2, 2006, each listed director, with the exception of Mr. Roberts, was granted 5,000 options to purchase shares of our common stock at an exercise price of $18.70. Mr. Roberts joined our Board in September 2006.
(4)		Mr. Armey resigned from our Board on September 21, 2006.
(5)		As of December 31, 2006, Mr. Armey beneficially owned 14,000 exercisable options to purchase shares of our common stock which were granted pursuant to the Previous Plan.
(6)		Mr. Berg resigned from our Board on March 14, 2007.
(7)		As of December 31, 2006, Mr. Berg beneficially owned 77,500 exercisable options to purchase shares of our common stock which were granted pursuant to the Previous Plan.
(8)		As of December 31, 2006, Ms. Burton beneficially owned 37,500 exercisable options to purchase shares of our common stock which were granted pursuant to the Previous Plan.
(9)		As of December 31, 2006, Mr. Copses beneficially owned 15,000 exercisable options to purchase shares of our common stock which were granted pursuant to the Previous Plan.
(10)		As of December 31, 2006, Mr. Gade beneficially owned 9,000 exercisable options to purchase shares of our common stock which were granted pursuant to the Previous Plan.
(11)		As of December 31, 2006, Mr. Lentell beneficially owned 62,500 exercisable options to purchase shares of our common stock which were granted pursuant to the Previous Plan.
(12)		As of December 31, 2006, Mr. Roberts did not beneficially own any options to purchase shares of our common stock.

		The following is a narrative discussion of the material factors which we believe are necessary to understand the information disclosed in the foregoing Director Compensation Table.
Cash Compensation:		In 2006, our non-employee directors each received an annual retainer of $30,000, payable in four equal installments on the first day of each fiscal quarter. Additionally, non-employee directors each received $2,000 for each Board meeting and $1,000 for each committee meeting attended in person and were reimbursed for their expenses in attending such meetings. Non-employee directors also each received $500 for each telephonic Board or committee meeting attended. During 2006, the Chairpersons of each committee do not receive any additional compensation for serving in such position. Messrs. Speese and Fadel did not receive any compensation for their services as a director during 2006.
		In 2007, our non-employee directors will generally be entitled to the same compensation to which each was entitled during 2006. In addition to such compensation, the

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		Chairperson of the Audit Committee will receive a $7,500 retainer and the other members of the Audit Committee will receive a $4,000 retainer. Furthermore, the Chairperson of the Compensation Committee and the Nominating and Corporate Governance Committee will receive a $4,000 retainer and the other members of those committees a $2,000 retainer.
Equity Compensation:		Our non-employee directors also receive options to purchase 9,000 shares of our common stock on the first business day of the first full fiscal year of service as a director and options to purchase 5,000 shares of our common stock on the first business day of each year thereafter. Under the Previous Plan, the exercise price of the options is the fair market value of shares of our common stock on the grant date. Pursuant to the 2006 Plan, the exercise price of the options is the closing price for shares of our common stock on the Nasdaq Global Select Market on the last market trading day prior to the date the option is granted. These options vest and are exercisable immediately. All of our non-employee directors serving on January 2, 2006 were granted 5,000 options pursuant to such terms on that date. All of our non-employee directors serving on January 2, 2007 were granted an additional 5,000 options on that date, except that Mr. Roberts, who joined our Board in September 2006, received options to purchase 9,000 shares of our common stock. Messrs. Speese and Fadel were not granted any options for their services as a director during 2006 or 2007. In addition, Mr. Jackson did not receive any award of options to purchase shares of our common stock in 2006, as he was appointed to our Board in March 2007.

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RELATED PERSON TRANSACTIONS

Intrust Bank:		J.V. Lentell, one of our directors, serves as Vice Chairman of the Board of Directors of Intrust Bank, N.A., one of our lenders. Intrust Bank, N.A. is a $15.0 million participant (total commitment) in our senior credit facility. We also maintain operational checking and other accounts, including a $15.0 million revolving line of credit, with Intrust Bank, N.A., of which $4,140,000 million was drawn down as of March 19, 2007. In addition, Intrust Bank, N.A. serves as trustee of our 401(k) plan. During 2006, we paid Intrust a total of $1,034,994 in fees in connection with banking services provided by them, of which $702,826 was for administration fees and trustee fees for our 401(k) plan.
Texas Capital Bank:		ColorTyme is a party to an agreement with Wells Fargo Foothill, Inc., which provides $35.0 million in aggregate financing to qualifying franchisees of ColorTyme. Under this agreement, the occurrence of certain events may result in ColorTyme paying the outstanding debt to Wells Fargo Foothill and then succeeding to the rights of Wells Fargo Foothill under the debt agreements. An additional $20.0 million of financing is provided by Texas Capital Bank, National Association under an agreement similar to the Wells Fargo financing. We guarantee the obligations of ColorTyme under these agreements, up to a maximum amount of $55.0 million, of which $27.9 million was outstanding as of December 31, 2006. Mark E. Speese,Rent-A-Center’s Chairman of the Board and Chief Executive Officer, is a passive investor in Texas Capital Bank, owning less than 1% of its outstanding equity.
Policy on Review and Approval ofTransactions withRelated Persons:		The Board has adopted a statement of policy and procedures for the identification and review of transactions involving us and “related persons” (our directors and executive officers, stockholders owning five percent or greater of our outstanding stock, immediate family members of any of the foregoing, or any entity in which any of the foregoing persons is employed or is a partner or principal or in a similar position or in which such person has a five percent or greater beneficial ownership interest).
		Our directors and executive officers are required to provide notice to our legal department of the facts and circumstances of any proposed transaction involving amounts greater than $50,000 involving them or their immediate family members that may be deemed to be a related person transaction. Our legal department will then assess whether the proposed related person transaction requires approval pursuant to the policy and procedures. If our legal department determines that any proposed, ongoing or completed transaction involves an amount in excess of $100,000 and is a related person transaction, our Chief Executive Officer and the Chairperson of the Nominating and Corporate Governance Committee must be notified (unless it involves our Chief Executive Officer, in which case the Chairperson must be notified), for consideration at the next regularly scheduled meeting of the Nominating and Corporate Governance Committee. In certain instances, the Chairperson may pre-approve or ratify, as applicable, any related person transaction in which the aggregate amount involved is, or is expected to be, less than $500,000.
		The Nominating and Corporate Governance Committee or the Chairperson, as applicable, will approve or ratify, as applicable, only those related person transactions that are in, or are not inconsistent with, our best interests and those of our stockholders.

COMPENSATION COMMITTEE INTERLOCKS

Committee Interlocks:		No member of the Compensation Committee (1) has ever been employed by us, as an officer or otherwise, or (2) other than with respect to Mr. Lentell, as described under the heading “Related Person Transactions” above, has or had any relationship with us in 2006 requiring disclosure pursuant to SEC rules. In addition, during 2006, none of our executive officers served as a member of the compensation or similar committee or as a member of the board of directors of any other entity of which an executive officer served on the Compensation Committee or Board of Directors ofRent-A-Center.

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OTHER BUSINESS

The Board does not intend to bring any business before the annual stockholders meeting other than the matters referred to in this notice and at this date has not been informed of any matters that may be presented to the annual stockholders meeting by others. If, however, any other matters properly come before the annual stockholders meeting, it is intended that the persons named in the accompanying proxy will vote pursuant to the proxy in accordance with their best judgment on such matters.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Based on a review of reports filed by our directors, executive officers and beneficial holders of 10% or more of our shares of Common Stock, and upon representations from those persons, we believe that all SEC stock ownership reports required to be filed by those reporting persons during 20052006 were timely made.

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RENT-A-CENTER STOCK OWNERSHIP

The following table lists our stock ownership for our directors, our named executive officers, and our known 5% stockholders. Ownership includes direct and indirect (beneficial) ownership, as defined by SEC rules. To our knowledge, each person, along with his or her spouse, has sole voting and investment power over the shares unless otherwise noted. Information in the table is as of March 24, 2006,19, 2007, unless otherwise indicated.

		Shares of
		Common Stock
		Beneficially Owned
Name and Address of						Percent
Beneficial Owner		Number				of Class
Mark E. Speese			2,969,080	(1)			4.25	%
Mitchell E. Fadel			385,138	(2)			*
Richard K. Armey			14,000	(3)			*
Laurence M. Berg			77,500	(3)			*
Mary Elizabeth Burton			37,500	(3)			*
Peter P. Copses			77,500	(3)			*
Michael J. Gade			11,400	(4)			*
J.V. Lentell			70,000	(3)			*
Robert D. Davis			52,341	(5)			*
Dana F. Goble			-0-	(6)			*
Christopher A. Korst			119,281	(7)			*
Pzena Investment Management, LLC(8)			8,604,213				12.42	%
Artisan Partners Limited Partnership(9)			5,594,200				8.07	%
Shapiro Capital Management LLC(10)			5,054,377				7.29	%
Barclays Global Investors, NA(11)			4,499,744				6.49	%
All executive officers and directors as a group (11 total)			3,813,740	(12)			5.40	%

 

		Shares of
		Common Stock
		Beneficially Owned
Name and Address of						Percent
Beneficial Owner		Number				Of Class
Mark E. Speese			2,639,080	(1)			3.7	%
Mitchell E. Fadel			388,305	(2)			*
Christopher A. Korst			120,186	(3)			*
J.V. Lentell			67,500	(4)			*
Robert D. Davis			53,681	(5)			*
Mary Elizabeth Burton			42,500	(6)			*
Peter P. Copses			20,000	(7)			*
Michael J. Gade			16,400	(8)			*
David E. West			14,415	(9)			*
Leonard H. Roberts			10,500	(10)			*
Jeffery M. Jackson			0	(11)			*
Pzena Investment Management, LLC(12)			7,674,640				10.9	%
Hotchkis and Wiley Capital Management, LLC(13)			4,563,300				6.5	%
Barclays Global Investors, NA(14)			3,964,594				5.6	%
All executive officers and directors as a group (11 total)			3,372,567	(15)			4.7	%

*	*	Less than 1%

		.
(1)		Represents (a) 1,731,7721,331,772 shares held directly and 4,500 shares held by Mr. Speese’s children, (b) 522,500 options granted under the Previous Plan, all of which are currently exercisable, (c) 70,000 options granted under the 2006 Long-Term Incentive Plan, all of which are currently exercisable, (c)(d) 539,218 shares held directly by Mr. Speese’s spouse, (d)(e) 57,030 shares held in the Jessica Elizabeth Speese 2000 Remainder Trust, Stephen F. Elken Trustee, (e)(f) 57,030 shares held in the Allison Rebecca Speese 2000 Remainder Trust, Stephen F. Elken Trustee, and (f)(g) 57,030 shares held in the Andrew Michael Speese 2000 Remainder Trust, Stephen F. Elken Trustee. Mr. Elken, as trustee of the foregoing trusts, has sole voting and investment power over the shares held in such trusts.
(2)	(2)	Represents (a) 375,00025,000 shares held directly, (b) 352,991 shares issuable pursuant to options granted under the Long-Term IncentivePrevious Plan, all of which are currently exercisable, (b) 6,313(c) 6,489 shares held pursuant to our 401(k) Plan (as of February 9, 2007), and (c)(d) 3,825 shares held in a personal IRA account.
(3)	(3)	Represents (a) 119,547 shares issuable pursuant to options granted under the Long-Term IncentivePrevious Plan, all of which are currently exercisable.
	(4)	Represents (a) 9,000 shares issuable pursuant to options granted under the Long-Term Incentive Plan, all of which are currently exercisable and (b) 2,400 shares held directly.
	(5)	Represents (a) 50,000 shares issuable pursuant to options granted under the Long-Term Incentive Plan, all of which are currently exercisable and (b) 2,341 shares held pursuant to our 401(k) Plan.
	(6)	Mr. Goble resigned from his position as Executive Vice President — Operations on January 4, 2006.
	(7)	Represents (a) 118,750 shares issuable pursuant to options granted under the Long-Term Incentive Plan, 43,75044,547 of which are currently exercisable, and 75,000 of which may become exercisable within 60 days, and (b) 531639 shares held pursuant to our 401(k) Plan.Plan (as of February 9, 2007).
(4)		Represents (a) 62,500 shares issuable pursuant to options granted under the Previous Plan, all of which are currently exercisable, and (b) 5,000 options granted under the 2006 Long-Term Incentive Plan, all of which are currently exercisable.
(5)		Represents (a) 51,330 shares issuable pursuant to options granted under the Previous Plan, all of which are currently exercisable, and (b) 2,351 shares held pursuant to our 401(k) Plan (as of February 9, 2007).
(6)		Represents (a) 37,500 shares issuable pursuant to options granted under the Previous Plan, all of which are currently exercisable and (b) 5,000 shares issuable pursuant to options granted under the 2006 Long-Term Incentive Plan, all of which are currently exercisable.
(7)		Represents (a) 15,000 shares issuable pursuant to options granted under the Previous Plan, all of which are currently exercisable and (b) 5,000 shares issuable pursuant to options granted under the 2006 Long-Term Incentive Plan, all of which are currently exercisable.
(8)		Represents (a) 9,000 shares issuable pursuant to options granted under the Previous Plan, all of which are currently exercisable, (b) 5,000 shares issuable pursuant to options granted under the 2006 Long-Term Incentive Plan, all of which are currently exercisable, and (c) 2,400 shares held directly.
(9)		Represents shares issuable pursuant to options granted under the Previous Plan, all of which are currently exercisable.

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(10)		Represents (a) 9,000 shares issuable pursuant to options granted under the 2006 Long-Term Incentive Plan, all of which are currently exercisable, and (b) 1,500 shares held directly.
(11)		Mr. Jackson was appointed to the Board of Directors on March 14, 2007.
(12)		The address of Pzena Investment Management, LLC is 120 West 45th Street, 20th Floor, New York, New York 10036. Pzena Investment Management, LLC exercises sole investment control over all 8,604,2137,674,640 of these shares and sole voting power over 6,980,6886,206,265 of these shares. This information is based on a Schedule 13G/A filed by Pzena Investment Management, LLC with the Securities and Exchange Commission on February 14, 2006.

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		13, 2007.
(9)(13)		The address of Artisan Partners Limited PartnershipHotchkis and Wiley Capital Management, LLC is 875 East Wisconsin Avenue, Suite 800, Milwaukee, Wisconsin 53202. Artisan Partners Limited Partnership725 S. Figueroa Street, 39th Floor, Los Angeles California 90017. Hotchkis and Wiley Capital Management, LLC exercises sharedsole investment and voting control over all 4,563,300 shares and sole voting power over 4,014,000 of these shares. This information is based on a Schedule 13G filed by Artisan Partners Limited PartnershipHotchkis and Wiley Capital Management, LLC with the Securities and Exchange Commission on January 27, 2006.

(10)	The address of Shapiro Capital Management LLC is 3060 Peachtree Road, Suite 1555 N.W., Atlanta, Georgia 30305-2240. Shapiro Capital Management LLC exercises sole investment control over all of these shares, sole voting control over 4,379,311 of these shares and shared voting control over 675,066 of these shares.February 14, 2007.
(11)(14)		The address of Barclays Global Investors, NA is 45 Fremont Street, San Francisco, California 94105. Barclays Global Investors, NA exercises sole investment control over all 4,499,7443,964,594 of these shares and sole voting control over 4,042,4713,650,007 of these shares. This information is based on a Schedule 13G filed by Barclays Global Investors, NA with the Securities and Exchange Commission on January 26, 2006.23, 2007.
(12)(15)		Includes 1,351,750(a) 1,184,783 shares issuable pursuant to options granted under the Long-Term IncentivePrevious Plan, 1,276,7501,109,783 of which are currently exercisable, and 75,000 of which may become exercisable within 60 days.days, and (b) 99,000 shares issuable pursuant to the 2006 Long-Term Incentive Plan, all of which are currently exercisable.

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VOTING PROCEDURES/PROCEDURES / REVOKING YOUR PROXY

Quorum:		For purposes of electing our directors, ratifying the appointment by the Audit Committee of Grant Thornton as our independent auditors, and for all other purposes, the holders of a majority of the votes entitled to vote at this year’s annual stockholders meeting, present in person or by proxy, will constitute a quorum.
Votes Required to Approve a Proposal:		To be elected, directors must receive a plurality of the shares voting in person or by proxy, provided a quorum exists. A plurality means receiving the largest number of votes, regardless of whether that is a majority. A majority of the votes cast is required to approve the 2006 Planratification of Grant Thornton as well asour independent auditors, provided a quorum exists. A majority of the votes cast is required to approve all other matters submitted to you at the meeting, provided a quorum exists, except as otherwise provided by law or our Certificate of Incorporation or Bylaws.
Shares Outstanding and Number of Votes:		On the Record Date, there were 69,303,00870,326,915 shares of our Common Stock outstanding. Each share of Common Stock entitles the holder to one vote per share.
Abstentions and Broker Non-Votes:		Those who fail to return a proxy or attend the meeting will not count towards determining any required plurality, majority or quorum. Stockholders and brokers returning proxies or attending the meeting who abstain from voting on the election of our directors or on the approval of the 2006 Planratification of Grant Thornton as our independent auditors will count towards determining a quorum. However, such abstentions will have no effect on the outcome of the election of our directors or on the approval of the 2006 Plan.ratification of Grant Thornton as principal independent auditors.
		Brokers holding shares of record for customers generally are not entitled to vote on certain matters unless they receive voting instructions from their customers. In the event that a broker does not receive voting instructions for these matters from its customers, a broker may notify us that it lacks voting authority to vote those shares. These ‘broker non-votes‘“broker non-votes” refer to votes that could have been cast on the matter in question by brokers with respect to uninstructed shares if the brokers had received their customers’ instructions. These broker non-votes will be included in determining whether a quorum exists, but will have no effect on the outcome of the election of our directors or the approvalratification of the 2006 Plan.Grant Thornton as our independent auditors.
How the Proxies Will be Voted:		The enclosed proxies will be voted in accordance with the instructions you place on the proxy card.card or, if you vote by telephone or the Internet, as indicated by such method. Unless otherwise stated, all shares represented by your returned, signed proxy will be voted as noted on the first page of this proxy statement. If you are voting by telephone or Internet, the proxies will be voted in accordance with your voting instructions. If you are voting by telephone or the Internet, your voting instructions must be received by 11:59 p.m. Eastern Daylight Savings Time on May 14, 2007.
How You May Revoke Your Proxy:		You may revoke your proxy by: •  Delivering a signed, written revocation letter, dated later than the proxy, to Christopher A. Korst, Senior Vice President — General Counsel and Secretary, at 5700 Tennyson Parkway, Suite 100,5501 Headquarters Drive, Plano, Texas 75024;
		•  Delivering a signed proxy, dated later than the first one, to Mellon Investor Services LLC, 480 Washington Boulevard, Jersey City, NJ 07310, Attn: Proxy Department;
		•  Voting at a later time by telephone or the Internet, if you previously voted by telephone or the Internet; or
		•  Attending the meeting and voting in person or by proxy. Attending the meeting alone will not revoke your proxy.
Proxy Solicitation:		We have retained Mellon to aid in the solicitationThe Board of proxies. ItDirectors is estimated that the cost of these services will be approximately $9,500 plus expenses. We will bear the entire cost of soliciting proxies.this proxy. In addition to the solicitation of proxies by mail, proxies may also be solicited by telephone, telegram, electronic mail or personal interview by our officers and regular employees of Mellon and us.employees. We will reimburse banks, brokers,

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		custodians, nominees and fiduciaries for reasonable expenses they incur in sending these proxy materials to you if you are a beneficial holder of our shares.

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SUBMISSION OF STOCKHOLDER PROPOSALS

Dates for Submission ofStockholders’Proposals:		From time to time, stockholders may seek to nominate directors or present proposals for inclusion in the proxy statement and form of proxy for consideration at an annual stockholders meeting. To be included in the proxy statement or considered at an annual or any special meeting, you must timely submit nominations of directors or proposals, in addition to meeting other legal requirements. We must receive proposals for the 20072008 annual stockholders meeting no later than December 18, 2006,15, 2007, for possible inclusion in the proxy statement, or prior to March 3, 2007,February 15, 2008, for possible consideration at the meeting, which is expected to take place on May 18, 2007.15, 2008. Direct any proposals, as well as related questions, to the undersigned.

ANNUAL REPORT ONFORM 10-K

You may obtain a copy of our Annual Report onForm 10-K that we filed with the Securities and Exchange Commission, without charge, by submitting a written request to:

	Christopher A. Korst, Senior Vice President —
	General Counsel and Secretary
	Rent-A-Center, Inc.
	5700 Tennyson Parkway, Suite 100
	Plano, Texas 75024.

Christopher A. Korst, Senior Vice President —
  General Counsel and Secretary
Rent-A-Center, Inc.
5501 Headquarters Drive
Plano, Texas 75024

You may also obtain our SEC filings through the internet at www.sec.gov.

	By order of the Board of Directors,
	Christopher A. Korst
	Senior Vice President — General Counsel
	and Secretary
	PLEASE VOTE — YOUR VOTE IS IMPORTANT

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APPENDIX A

CHARTER

OF THE

AUDIT COMMITTEE

OF

RENT-A-CENTER, INC.

PURPOSE

     The primary function of the Audit Committee (the“Committee”) is to assist the Board of Directors, (the“Board”) ofRent-A-Center, Inc. (the“Company”) in fulfilling its oversight responsibilities by reviewing (i) the financial reports and other financial information provided by the Company to any governmental body or the public; (ii) the Company’s systems of controls regarding finance, accounting, legal compliance and ethics that management and the Board have established; (iii) the independent auditors’ qualifications and independence; (iv) the performance of the Company’s internal audit function and independent auditors; and (v) the efficacy and efficiency of the Company’s auditing, accounting and financial reporting processes generally. The Committee’s primary duties and responsibilities are to:

•	serve as an independent and objective party to oversee the Company’s financial reporting process and internal control system;
•	assume direct responsibility for the appointment, compensation, retention and oversight of the Company’s independent auditors; and
•	provide an open avenue of communication among the Company’s independent auditors, financial and senior management and the Board.

     The Committee will primarily fulfill these responsibilities by carrying out the activities enumerated in the Section entitled “Responsibilities and Duties.”

     The Committee shall have the authority, to the extent it deems necessary or appropriate, to retain independent legal, accounting or other advisors. The Company shall provide appropriate funding, as determined by the Committee, in its capacity as a committee of the Board, for payment of compensation to any advisors engaged or employed by the Committee as well as for ordinary administration expenses of the Committee that are necessary or appropriate for carrying out its duties.

COMPOSITION OF THE AUDIT COMMITTEE

     The Committee shall be comprised of three or more directors as determined by the Board, each of whom shall meet the independence, experience and qualification requirements of The Nasdaq Stock Market, Inc. (including, without limitation, the financial literacy requirements), Section 10A(m)(3) of the Securities Exchange Act of 1934, as amended (the“Exchange Act”), and the rules and regulations of the Securities and Exchange Commission (the“Commission”). Accordingly, none of the members of the Committee shall accept, directly or indirectly, any fees from the Company, except for fees for services as a director and member of the Committee or any other Board committee. In addition, at least one member of the Committee shall be, in the sole determination of the Board, a “financial expert” in compliance with the criteria established by Commission and other relevant regulations.

     No member of the Committee may serve on the audit committee of more than three other public companies.

MEETINGS OF THE COMMITTEE

     The Committee shall meet as often as it determines, but not less frequently than quarterly. All such meetings may be conducted in person or telephonically. As part of its role to foster open communication, the Committee should meet periodically with management, the Company’s internal auditors and the independent auditors in separate executive sessions. In addition, the Committee shall meet quarterly with the Company’s independent auditors and management to discuss the annual audited financial statements and quarterly financial statements, including the Company’s disclosures under “Management’s Discussion

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and Analysis of Financial Condition and Results of Operations,” as well as quarterly earnings releases. The Company shall provide the Committee with the applicable financial data sufficiently in advance of such meetings to facilitate such review. The Committee may request any officer or employee of the Company (including without limitation, theChristopher A. Korst
Senior Vice President of Internal Audit), the Company’s outside counsel or its independent auditors to attend meetings of the Committee or to meet with any members of, or consultants to, the Company.— General Counsel
  and Secretary

RESPONSIBILITIES AND DUTIESPLEASE VOTE — YOUR VOTE IS IMPORTANT

     To fulfill its responsibilities and duties, the Committee shall:

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Documents/ Reports Review

	1.	Review, update and assess the adequacy of this Charter periodically, but at least annually, as conditions dictate, and recommend any proposed changes to the Board for its approval.
	2.	Review and discuss the annual audited financial statements with management, and discuss with the independent auditors the matters required to be discussed by relevant auditing standards, including the quality, not just the acceptability, of the accounting principles and underlying estimates used in the audited financial statements.
	3.	Report to the Board whether, based on such reviews and discussions, the Committee recommends to the Board that the audited financial statements be included in the Company’s Form 10-K to be filed with the Commission.
	4.	Review with management and the Company’s independent auditors the Company’s Form 10-Q prior to its filing.
	5.	Review earnings press releases with management, including the use of “pro forma” or “adjusted”non-GAAP information, as well as financial information and earnings guidance provided to analysts.
	6.	Prepare annually the report required by the rules of the Commission to be included in the Company’s annual proxy statement.
	7.	Report regularly to the Board on the matters discussed at the meetings of the Committee, including the actions taken by the Committee at such meetings.

Independent Auditors

	8.	Be directly responsible for the appointment, compensation, retention and oversight of the work performed by the Company’s independent auditors for the purpose of preparing or issuing an audit report or related work or performing other audit, review or attest services for the Company. The Company’s independent auditors shall report directly to the Committee, and the Company shall provide the Committee appropriate funding, as determined by the Committee, in its capacity as a committee of the Board, to compensate the independent auditors. The Committee shall have sole authority to appoint or replace the independent auditors and to approve all engagement fees and terms.
	9.	Discuss with the Company’s independent auditors the matters required to be discussed by Statement on Auditing Standards No. 61 relating to the conduct of the audit, including any difficulties encountered in the course of the audit work, any restrictions on the scope of activities or access to requested information, and any significant disagreements with management.

10.	Hold timely discussions with the independent auditors regarding:

	•	critical accounting estimates, policies and practices;
	•	alternative treatments of financial information within generally accepted accounting principles that have been discussed with management, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the Company’s independent auditors;
	•	other material written communication between the Company’s independent auditors and management including, but not limited to, the management letter and schedule of unadjusted differences; and

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	•	an analysis of the independent auditors’ judgment as to the quality of the Company’s accounting principles, setting forth significant reporting issues and judgments made in connection with the preparation of the Company’s financial statements.

11.	Review and pre-approve both audit and all permissible non-audit services to be provided by the independent auditors, other then thede minimisexceptions permitted by theSarbanes-Oxley Act of 2002 (“Sarbanes-Oxley”).
12.	Obtain and review a report from the Company’s independent auditors at least annually regarding:

	•	the independent auditors’ internal quality-control procedures;
	•	any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities or private sector regulatory boards within the preceding five years respecting one or more independent audits carried out by the firm; and
	•	any steps taken to deal with any such issues.

13.	Evaluate the qualifications, performance and independence of the Company’s independent auditors, including considering whether the auditors’ quality controls are adequate and the provision of permitted non-audit services is compatible with maintaining the auditors’ independence. The Committee shall obtain from the Company’s independent auditors a formal written statement delineating all relationships between the Company’s independent auditors and the Company, consistent with Independence Standards Board Standard 1, and engage in a dialogue with the Company’s independent auditors with respect to any disclosed relationships or services that may impact the objectivity and independence of the Company’s independent auditors.
14.	Review and evaluate the performance of the lead partner of the Company’s independent auditor team and ensure the rotation of the audit engagement team as required by law or such shorter period as may be determined by the Committee.
15.	Establish policies regarding the hiring of employees or former employees of the Company’s independent auditors.

Financial Reporting Processes and Accounting Principles

16.	In consultation with the Company’s independent auditors, review the integrity of the Company’s financial reporting processes, both internal and external. The Committee shall coordinate the Board’s oversight of the Company’s internal accounting systems and controls.
17.	Review with management and the independent auditors significant accounting principles and financial reporting issues, including judgments made in connection with the preparation of the Company’s financial statements and significant changes in the Company’s selection or application of accounting principles.
18.	Review with management and the Company’s independent auditors the extent to which changes or improvements in financial or accounting practices have been implemented. This review should be conducted at an appropriate time subsequent to implementation of changes or improvements, as decided by the Committee.

Internal Audit

19.	Review and advise on the selection and removal of the Vice President of Internal Audit, who shall report directly to the Committee no less frequently than quarterly. A portion of such report shall be conducted in executive session outside the presence of Company management.
20.	Review and make recommendations to Company management regarding the internal audit department’s responsibilities, budget and staffing.
21.	Review summaries of all internal audit reports prepared by the internal audit department (including management’s responses) and any other significant findings stemming from internal audit activities.

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22.	Be apprised by the Company’s Vice President of Internal Audit of any significant difficulties, disagreements with management or scope restrictions encountered in the course of the internal audit department’s work.
23.	Make a recommendation to the Board, on an annual basis, concerning the compensation to be paid to the Vice President of Internal Audit after receipt from Company management of such input concerning such compensation as the Committee deems appropriate. The Board shall make the final determination of the compensation to be paid to the Vice President of Internal Audit.

Compliance Oversight and Other Responsibilities

24.	Establish policies and procedures for the submission of complaints and concerns about accounting, internal accounting controls and auditing matters, including procedures for the receipt, retention, and treatment of complaints and the confidential, anonymous submission of employee concerns regarding questionable accounting or auditing matters.
25.	Oversee the Company’s disclosure controls and procedures and the implementation of, and compliance with, the Company’s Code of Ethics. The Company’s Compliance Officer shall report directly to the Committee no less frequently than quarterly. A portion of such report shall be conducted in executive session outside the presence of Company management.
26.	Receive and review the reports of the Company’s Chief Executive Officer and Chief Financial Officer required by Section 302 ofSarbanes-Oxley and Rule 13a-14 of the Exchange Act.
27.	Determine whether management has a proper review system in place to determine that the Company’s financial statements, reports and other financial information disseminated to governmental organizations and the public satisfy legal requirements.
28.	Discuss with management the Company’s major financial risk areas and the steps taken by management to monitor and control such areas, including the Company’s guidelines and policies to govern the process by which the Company’s exposure to risk is handled.
29.	Discuss with the Company’s independent auditors whether Section 10A(b) of the Exchange Act concerning awareness of illegal acts pertaining to the Company has been implicated.
30.	Conduct and review with the Board annually an evaluation of the Committee’s performance with respect to the requirements of this Charter.
31.	Perform such other duties as may be delegated to the Committee by the Board from time to time.

LIMITATION OF COMMITTEE’S ROLE

     While the Committee has the responsibilities and powers set forth in this Charter, it is not the duty of the Committee to plan or conduct audits or to determine that the Company’s financial statements and disclosures are complete and accurate and are in accordance with generally accepted accounting principles and applicable rules and regulations. These are the responsibilities of management and the independent auditors.

Approved by the Board of Directors on May 18, 2005, superseding the Charter of the Audit Committee previously approved on May 21, 2003.

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APPENDIX B

RENT-A-CENTER, INC.

2006 LONG-TERM INCENTIVE PLAN

1. Purpose. The purpose of the plan is to foster the ability ofRent-A-Center, Inc. (the “Company”) and its subsidiaries to attract, motivate and retain key personnel and enhance stockholder value through the use of certain equity and cash incentive compensation opportunities. The Company’s existing equity compensation plan, known as the Amended and RestatedRent-A-Center, Inc. Long-Term Incentive Plan, as previously amended and restated through August 29, 2003, shall terminate subject to and upon the approval of this plan by the Company’s stockholders.

2. Administration.

	(a) Committee. The plan will be administered by the compensation committee of the Company’s board of directors (the “Committee”).
	(b) Responsibility and Authority of Committee. Subject to the provisions of the plan, the Committee, acting in its discretion, will have responsibility and full power and authority to (1) select the persons to whom awards will be made, (2) prescribe the terms and conditions of each award and make amendments thereto, (3) construe, interpret and apply the provisions of the plan and of any agreement or other document governing the terms of an award made under the plan, and (4) make any and all determinations and take any and all other actions as it deems necessary or desirable in order to carry out the terms of the plan. Notwithstanding the foregoing, the Company’s board of directors will have sole responsibility and authority for matters relating to the grant and administration of awards to non-employee directors, and reference herein to the Committee with respect to any such matters will be deemed to refer to the board of directors. In exercising its responsibilities under the plan, the Committee may obtain at the Company’s expense such advice, guidance and other assistance from outside compensation consultants and other professional advisers as it deems appropriate.
	(c) Delegation of Authority. Subject to the requirements of applicable law, the Committee may delegate to any person or group or subcommittee of persons (who may, but need not be, members of the Committee) such plan-related functions within the scope of its responsibility, power and authority on such terms and conditions as it deems appropriate;provided, however, that the Committee may not delegate authority to grant or administer awards granted to the Company’s senior executive officers.
	(d) Committee Actions. A majority of the members of the Committee shall constitute a quorum. The Committee may act by the vote of a majority of its members present at a meeting at which there is a quorum or by unanimous written consent. The decision of the Committee as to any disputed question, including questions of construction, interpretation and administration, shall be final and conclusive on all persons. The Committee shall keep a record of its proceedings and acts and shall keep or cause to be kept such books and records as may be necessary in connection with the proper administration of the plan.
	(e) Indemnification. The Company shall indemnify and hold harmless each member of the Committee or subcommittee appointed by the Committee and any employee or director of the Company or of a subsidiary to whom any duty or power relating to the administration or interpretation of the plan is delegated from and against any loss, cost, liability (including any sum paid in settlement of a claim with the approval of the board of directors), damage and expense, including legal and other expenses incident thereto, arising out of or incurred in connection with the such person’s services under the plan, unless and except to the extent attributable to such person’s fraud or willful misconduct.

3. Eligibility. Plan awards may be made to any present or future directors, officers, employees, consultants and other personnel of the Company or a subsidiary.

4. Limitations on Plan Awards.

	(a) Aggregate Share Limitations. The Company may issue a total of 7,000,000 shares of its common stock, par value $.01 per share (the “Common Stock”) under the plan, of which no more than 3,500,000 shares may be issued in the form of restricted stock, deferred stock or similar forms of stock award which have value without regard to future appreciation in value of or dividends declared on the

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	underlying shares of stock. In applying these limitations, the following shares will be deemed not to have been issued: (1) shares covered by the unexercised portion of an option that terminates, expires, or is canceled or settled in cash, and (2) shares that are forfeited or subject to awards that are forfeited, canceled, terminated or settled in cash.
	(b) Individual Employee Limitations. In any calendar year, (1) no employee may receive options and stock appreciation rights for more than 600,000 shares of Common Stock; (2) no employee may earn more than 600,000 shares of Common Stock pursuant to performance-based equity incentive awards (other than options and stock appreciation rights) described in Section 9, increased by the unused limit, if any, from prior calendar years; and (3) no employee may earn more than $3,000,000 pursuant to performance-based cash awards described in Section 9, increased by the unused limit, if any, from prior calendar years. For these purposes, an award is “earned” upon satisfaction of the applicable performance conditions, even if settlement is deferred or subject to a continuing service and/or other non-performance conditions; and an employee’s annual limit is deemed to be used in a calendar year to the extent a share or cash award could be earned in that year, regardless of the extent to which such award is earned.

5. Stock Option Awards. Subject to the plan, the Committee may grant stock options to such persons, at such times and upon such vesting and other conditions as the Committee, acting in its discretion, may determine.

	(a) Minimum Exercise Price. The purchase price per share of Common Stock covered by an option granted under the plan may not be less than the fair market value per share on the date the option is granted. If the Common Stock is listed on an established stock exchange or traded on the Nasdaq National Market or the Nasdaq SmallCap Market, the fair market value per share shall be the closing sales price (or the closing bid, if no sales were reported) as quoted on such exchange or market (or the exchange or market with the greatest volume of trading in the Common Stock) on the last market trading day prior to the day of determination, as reported inThe Wall Street Journal or such other source as the Committee deems reliable. The exercise price under an option which is intended to qualify as an “incentive stock option” (within the meaning of Section 422 of the Internal Revenue Code of 1986) granted to an employee who is a 10% stockholder within the meaning of Section 422(b)(6) of the Code, may not be less than 110% of the fair market value per share on the date the option is granted.
	(b) No Repricing of Options. Unless approved by the Company’s stockholders, the Committee may not reduce the exercise price for shares covered by an outstanding option granted under the plan, whether directly or in any other manner which constitutes a “repricing” under applicable stock exchange rules or financial accounting principles.
	(c) Maximum Duration. Unless sooner terminated in accordance with its terms, an option will automatically expire on the tenth anniversary of the date it is granted (the fifth anniversary of the date it is granted in the case of an option which is intended to qualify as an “incentive stock option” granted to an employee who is a 10% stockholder).
	(d) Nontransferability. No option shall be assignable or transferable except upon the optionee’s death to a beneficiary designated by the optionee in a manner prescribed or approved for this purpose by the Committee or, if no designated beneficiary shall survive the optionee, pursuant to the optionee’s will or by the laws of descent and distribution. During an optionee’s lifetime, options may be exercised only by the optionee or the optionee’s guardian or legal representative. Notwithstanding the foregoing, the Committee may permit the inter vivos transfer of an optionee’s options (other than options designated as “incentive stock options”) by gift to any “family member” (within the meaning of Item A.1.(5) of the General Instructions to Form S-8 or any successor provision), on such terms and conditions as the Committee deems appropriate.
	(e) Manner of Exercise. An option may be exercised by transmitting to the Secretary of the Company (or such other person designated by the Committee) a written notice identifying the option being exercised and specifying the number of shares being purchased, together with payment of the exercise price and the amount of the applicable tax withholding obligations (unless other arrangements are made for the payment of such exercise and/or the satisfaction of such withholding obligations). The Committee, acting in its discretion, may permit the exercise price and withholding obligation to be paid in whole or in part in cash or by check, by means of a cashless exercise procedure to the extent

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	permitted by law, by the surrender of previously-owned shares of Common Stock (to the extent of the fair market value thereof) or, subject to applicable law, by any other form of consideration deemed appropriate.
	(f) Rights as a Stockholder. No shares of stock will be issued in respect of the exercise of an option until payment of the exercise price and the applicable tax withholding obligations are been made or arranged to the satisfaction of the Company. The holder of an option shall have no rights as a stockholder with respect to any shares covered by the option until the shares are issued pursuant to the exercise of the option.
	(g) Maximum Number of Incentive Stock Options. The maximum number of shares of Common Stock which may be issued under the plan covering an option granted as an “incentive stock option” (within the meaning of Section 422 of the Internal Revenue Code of 1986) is 500,000.

6. Stock Awards. Subject to the plan, the Committee may grant restricted stock, deferred stock, stock units, stock bonus and other stock awards to such persons, at such times and upon such vesting and other conditions and restrictions as the Committee, acting in its discretion, may determine.

	(a) Minimum Purchase Price. The consideration payable for shares transferred pursuant to a stock award must be no less than the minimum consideration (if any) required by applicable law.
	(b) Stock Certificates for Restricted Stock. Shares of restricted stock issued pursuant to a stock award may be evidenced by book entry on the Company’s stock transfer records or by a stock certificate issued in the recipient’s name and bearing an appropriate legend regarding the conditions and restrictions applicable to the shares. The Company may require that stock certificates for restricted shares be held in custody by the Company or a designee pending the lapse of applicable forfeiture conditions and transfer restrictions. The Committee may condition the issuance of shares of restricted stock on the recipient’s delivery to the Company of a stock power, endorsed in blank, for such shares.
	(c) Stock Certificates for Vested Stock. The recipient of a stock award which is vested at the time of grant or which thereafter becomes vested will be entitled to receive a certificate, free and clear of conditions and restrictions (except as may be imposed in order to comply with applicable law) for the shares covered by such vested award, subject to the payment or satisfaction of applicable tax withholding obligations and, in the case of shares covered by a vested stock unit award, subject to applicable deferral conditions permitted by Section 409A of the Code.
	(d) Rights as a Stockholder. Unless otherwise determined by the Committee, (1) the holder of a stock award will not be entitled to receive dividend payments (or, in the case of an award of stock units, dividend equivalent payments) with respect to the shares covered by the award and (2) the holder of shares of restricted stock may exercise voting rights pertaining to such shares. The Committee may impose vesting and deferral conditions on the payment of dividends, corresponding to the vesting and deferral conditions applicable to the corresponding stock award.
	(e) Nontransferability. Except as may be specifically permitted by the Committee in connection with transfers at death or pursuant to inter vivos gifts, no outstanding stock award and no shares of stock covered by an outstanding stock award may be sold, assigned, transferred, disposed of, pledged or otherwise hypothecated other than to the Company in accordance with the terms of the award or the plan. Any attempt to do any of the foregoing shall be null and void and, unless the Committee determines otherwise, shall result in the immediate forfeiture of the award and/or the shares.

7. Other Equity-Based Awards. The Committee may grant stock appreciation rights, dividend equivalent payment rights, phantom shares, phantom stock units, bonus shares and other forms of equity-based awards to eligible persons, subject to such terms and conditions as it may establish;provided, howeverthat no dividend or dividend equivalent payment rights shall be attributable to awards of stock appreciation rights or stock options. The base price for a stock appreciation right granted under the plan may not be less than the fair market value per share of stock covered by the award at the time it is granted. Unless sooner termination in accordance with its terms, a stock appreciation right will automatically expire on the tenth anniversary of the date it is granted. Awards made pursuant to this section may entail the transfer of shares of Common Stock to a participant or the payment in cash or other property determined with reference to shares of Common Stock.

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8. Cash Awards. The Committee may grant awards in cash with the amount of the eventual payment subject to future service and such other restrictions and conditions as may be established by the Committee and set forth in the underlying agreement, including, but not limited to, continuous service with the Company and its subsidiaries, achievement of specific business objectives, increases in specified indices, attaining specified growth rates and other measurements of performance.

9. Performance-Based Equity and Cash Awards.

	(a) General. The Committee may condition the grant, exercise, vesting or settlement of equity-based awards on the achievement of specified performance goals in accordance with this section. The Committee may also condition the grant, vesting or payment of annual and long-term cash incentive awards on the achievement of specified performance goals in accordance with this section. The applicable performance period for measuring achievement of specified performance goals may be any period designated by the Committee.
	(b) Objective Performance Goals. A performance goal established in connection with an award covered by this section must be (1) objective, so that a third party having knowledge of the relevant facts could determine whether the goal is met, (2) prescribed in writing by the Committee before the beginning of the applicable performance period or at such later date when fulfillment is substantially uncertain not later than 90 days after the commencement of the performance period and in any event before completion of 25% of the performance period, and (3) based on any one or more of the following business criteria (which may be applied to an individual, a subsidiary, a business unit or division, or the Company and any one or more of its subsidiaries as a whole, as determined by the Committee):

	(i) total revenue or any key component thereof;
	(ii) operating income, pre-tax or after-tax income from continuing operations; earnings before interest, taxes and amortization (i.e. EBITA); earnings before interest, taxes, depreciation and amortization (i.e. EBITDA); or net income;
	(iii) cash flow (including, without limitation, free cash flow, cash flow return on investment (discounted or otherwise), net cash provided by operations or cash flow in excess of cost of capital);
	(iv) earnings per share or earnings per share from continuing operations (basic or diluted);
	(v) return on capital employed, return on invested capital, return on assets or net assets;
	(vi) after-tax return on stockholders’ equity;
	(vii) economic value created;
	(viii) operating margins or operating expenses;
	(ix) value of the Common Stock or total return to stockholders;
	(x) value of an investment in the Common Stock assuming the reinvestment of dividends;
	(xi) strategic business criteria, consisting of one or more objectives based on meeting specified market penetration goals, geographic business expansion goals, cost targets, management of employment practices and employee benefits, or supervision of litigation or information technology goals, or goals relating to acquisitions or divestitures of subsidiaries, affiliates or joint ventures; and/or
	(xii) a combination of any or all of the foregoing criteria.

The targeted level or levels of performance with respect to such business criteria may be established at such levels and in such terms as the Committee may determine, in its discretion, including in absolute terms, as a goal relative to performance in prior periods, or as a goal compared to the performance of one or more comparable companies or an index covering multiple companies. If and to the extent permitted for awards intended to qualify as “performance-based” under Section 162(m) of the Code and regulations thereunder, the Committee may provide for the adjustment of such performance goals to reflect changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions) and other similar types of events or circumstances occurring during the applicable performance period.

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(c) Calculation of Performance-Based Award. At the expiration of the applicable performance period, the Committee shall determine the extent to which the performance goals established pursuant to this Section are achieved and the extent to which each performance-based award has been earned. The Committee may not exercise its discretion to increase the amount or value of an award that would otherwise be payable in accordance with the terms of a performance-based award made in accordance with this section.

10. Capital Changes, Reorganization, Sale.

	(a) Adjustments Upon Changes in Capitalization. The aggregate number and class of shares issuable under the plan, the maximum number of shares with respect to which options, stock appreciation rights and other equity awards may be granted to or earned by any employee in any calendar year, the number and class of shares and the exercise price or base price per share covered by each outstanding option and stock appreciation right, and the number and class of shares covered by each outstanding deferred stock unit or other-equity-based award, and any per-share base or purchase price or target market price included in the terms of any such award, and related terms shall be adjusted to reflect any increase or decrease in the number of issued shares of Common Stock resulting from asplit-up or consolidation of shares or any like capital adjustment, or the payment of any stock dividend, and/or to reflect a change in the character or class of shares covered by the plan arising from a readjustment or recapitalization of the Company’s capital stock.
	(b) Cash, Stock or Other Property for Stock. Except as otherwise provided in this section, in the event of an “exchange transaction” (as defined below), all optionees shall be permitted to exercise their outstanding options in whole or in part (whether or not otherwise exercisable) immediately prior to such exchange transaction, and any outstanding options which are not exercised before the exchange transaction shall thereupon terminate. Notwithstanding the preceding sentence, if, as part of an exchange transaction, the stockholders of the Company receive capital stock of another corporation (“exchange stock”) in exchange for their shares of Common Stock (whether or not such exchange stock is the sole consideration), and if the Company’s board of directors, acting in its discretion, so directs, then all outstanding options shall be converted in whole or in part into options to purchase shares of exchange stock. The amount and price of such converted options shall be determined by adjusting the amount and price of the options granted hereunder on the same basis as the determination of the number of shares of exchange stock the holders of outstanding Common Stock are entitled to receive in the exchange transaction and, unless the Company’s board of directors determines otherwise, the vesting conditions with respect to the converted options shall be substantially the same as the vesting conditions set forth in the original option agreement. The board of directors, acting in its discretion, may accelerate vesting of non-vested stock awards and other awards, provide for cash settlement of and/or make such other adjustments to the terms of any outstanding award (including, without limitation, outstanding options) as it deems appropriate in the context of an exchange transaction, taking into account, as applicable, the manner in which outstanding options are being treated.
	(c) Definition of Exchange Transaction. For purposes hereof, the term “exchange transaction” means a merger (other than a merger of the Company in which the holders of the Common Stock immediately prior to the merger have the same proportionate ownership of common stock in the surviving corporation immediately after the merger), consolidation, acquisition or disposition of property or stock, separation, reorganization (other than a mere reincorporation or the creation of a holding company), liquidation of the Company or any other similar transaction or event so designated by the Company’s board of directors, acting in its discretion, as a result of which the stockholders of the Company receive cash, stock or other property in exchange for or in connection with their shares of Common Stock.
	(d) Fractional Shares. In the event of any adjustment in the number of shares covered by any award pursuant to the provisions hereof, any fractional shares resulting from such adjustment shall be disregarded, and each such award shall cover only the number of full shares resulting from the adjustment.
	(e) Determination of Board to be Final. All adjustments under this Section shall be made by the Company’s board of directors, and its determination as to what adjustments shall be made, and the extent thereof, shall be final, binding and conclusive.

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11. Tax Withholding. As a condition to the exercise or settlement of any award, or in connection with any other event that gives rise to a tax withholding obligation on the part of the Company or a subsidiary relating to an award, the Company and/or the subsidiary may (a) deduct or withhold (or cause to be deducted or withheld) from any payment or distribution to the recipient of an award, whether or not made pursuant to the plan or (b) require the recipient to remit cash (through payroll deduction or otherwise), in each case in an amount sufficient in the opinion of the Company to satisfy such withholding obligation. If the event giving rise to the withholding obligation involves a transfer of shares of stock, then, at the sole discretion of the Committee, the recipient may satisfy the applicable tax withholding obligation by electing to have the Company withhold shares of stock or by tendering previously-owned shares, in each case having a fair market value equal to the amount of tax to be withheld (or by any other mechanism as may be required or appropriate to conform with local tax and other rules).

12. Amendment and Termination. The Company’s board of directors may amend or terminate the plan;provided, however, that no such action may adversely affect a holder’s rights under an outstanding award without his or her written consent. Any amendment that would increase the aggregate number of shares of Common Stock issuable under the plan, the maximum number of shares with respect to which options, stock appreciation rights or other equity swards may be granted to any employee in any calendar year, or that would modify the class of persons eligible to receive awards shall be subject to the approval of the Company’s stockholders. The Committee may amend the terms of any agreement or award made hereunder at any time and from time to time, provided, however, that any amendment which would adversely affect a holder’s rights under an outstanding award may not be made without his consent.

13. General Provisions.

	(a) Shares Issued Under Plan. Shares of Common Stock available for issuance under the plan may be authorized and unissued, held by the Company in its treasury or otherwise acquired for purposes of the plan. No fractional shares will be issued under the plan.
	(b) Compliance with Law. The Company will not be obligated to issue or deliver shares of stock pursuant to the plan unless the issuance and delivery of such shares complies with applicable law, including, without limitation, the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the requirements of any stock exchange or market upon which the Company’s stock may then be listed. The Company may prevent or delay the exercise of an option or stock appreciation right, or the settlement of an award and/or the termination of restrictions applicable to an award if and to the extent the Company deems necessary or advisable in order to avoid a violation of applicable laws or its own policies regarding the purchase and sale of its stock. If, during the period of any such ban or delay, the term of an affected stock option, stock appreciation right or other award would expire, then the term of such option, stock appreciation right or other award will be extended for thirty days after the Company’s removes the restriction against exercise.
	(c) Transfer Orders; Placement of Legends. All certificates for shares of Common Stock delivered under the plan shall be subject to such stock-transfer orders and other restrictions as the Company may deem advisable, including pursuant to the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange or market upon which the Company’s stock may then be listed, and any applicable federal or state securities law. The Company may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions.
	(d) No Employment or other Rights. Nothing contained in the plan or in any award agreement shall confer upon any recipient of an award any right with respect to the continuation of his or her employment or other service with the Company or a subsidiary or interfere in any way with the right of the Company and its subsidiaries at any time to terminate such employment or other service or to increase or decrease, or otherwise adjust, the other terms and conditions of the recipient’s employment or other service.
	(e) Decisions and Determinations Final. All decisions and determinations made by the Company’s board of directors pursuant to the provisions hereof and, except to the extent rights or powers under the Plan are reserved specifically to the discretion of the board of directors, all decisions and determinations of the Committee, shall be final, binding and conclusive on all persons.

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14. Governing Law. All rights and obligations under the plan and each award agreement or instrument shall be governed by and construed in accordance with the laws of the State of Texas, without regard to its principles of conflict of laws.

15. Term of the Plan. The plan, as amended and restated, shall become effective on the restatement date (which is date of adoption by the board of directors), subject to approval by the Company’s stockholders within twelve months thereafter. Unless terminated sooner by the board of directors, the plan shall terminate on the tenth anniversary of the restatement date. The rights of any person with respect to an award made under the plan that is outstanding at the time of the termination of the plan shall not be affected solely by reason of the termination of the plan and shall continue in accordance with the terms of the award and of the plan, as each is then in effect or is thereafter amended.

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RENT-A-CENTER, INC.

5700 TENNYSON PARKWAY
PLANO, TEXAS 75024

THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF RENT-A-CENTER, INC.

COMMON STOCK

      The undersigned, hereby revoking all prior proxies, hereby appoints Robert D. Davis and Christopher A. Korst jointly and severally, with full power to act alone, as my true and lawful attorneys-in-fact, agents and proxies, with full and several power of substitution to each, to vote all the shares of Common Stock of Rent-A-Center, Inc. which the undersigned would be entitled to vote if personally present at the Annual Meeting of Stockholders of Rent-A-Center, Inc. to be held on May 19, 2006, and at any adjournments and postponements thereof. The above-named proxies are hereby instructed to vote as shown on the reverse side of this card.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS SPECIFIED HEREIN, BUT WHERE NO DIRECTION IS GIVEN IT WILL BE VOTED “FOR” PROPOSAL 1 AND 2, AND IN THE DISCRETION OF THE ABOVE NAMED PERSONS ACTING AS PROXIES ON SUCH OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING.

Address Change/Comments(Mark the corresponding box on the reverse side)

▲ FOLD AND DETACH HERE ▲

RENT-A-CENTER, INC. 5501 HEADQUARTERS DRIVE PLANO, TEXAS 75024 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF RENT-A-CENTER, INC. COMMON STOCK The undersigned, hereby revoking all prior proxies, hereby appoints Robert D. Davis and Christopher A. Korst jointly and severally, with full power to act alone, as my true and lawful attorneys-in-fact, agents and proxies, with full and several power of substitution to each, to vote all the shares of Common Stock of Rent-A-Center, Inc. which the undersigned would be entitled to vote if personally present at the Annual Meeting of Stockholders of Rent-A-Center, Inc. to be held on May 15, 2007, and at any adjournments and postponements thereof. The above-named proxies are hereby instructed to vote as shown on the reverse side of this card. THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS SPECIFIED HEREIN, BUT WHERE NO DIRECTION IS GIVEN IT WILL BE VOTED “FOR” PROPOSAL 1 AND 2, AND IN THE DISCRETIO N OF THE ABOVE-NAMED PERSONS ACTING AS PROXIES ON SUCH OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING. Address Change/Comments (Mark the corresponding box on the reverse side) FOLD AND DETACH HERE

 

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Please Mark Here for Address Change or Comments SEE REVERSE SIDE		o

1.		ELECTION OF CLASS IIII DIRECTORS as set forth in the 2. To ratify the Audit Committee’s appointment of Grant Thornton, FOR AGAINST ABSTAIN accompanying proxy statement. LLP, registered independent accountants, as the Company’s FOR WITHHOLD AUTHORITY independent auditors for the fiscal year ended December 31, the nominees to vote for the nominees 2007, as set forth in the accompanying proxy statement.
		FOR the nominees listed below		WITHHOLD AUTHORITY to vote for the nominees listed below
		o		o
01 02		J. V. Lentell Michael J. Gade

2.		Approval of the Rent-A-Center, Inc. 2006 Long-Term Incentive Plan as set forth in the accompanying proxy statement.
		FOR		AGAINST		ABSTAIN
		o		o		o

3.		In their discretion, upon such other business as may properly come before the meeting.
				01 Mary Elizabeth Burton 02 Peter P. Copses I PLAN TO ATTEND				o

03 Mitchell E. Fadel The undersigned(s) acknowledges receipt of the Notice WITHHELD FOR: (To withhold authority to vote for any individual of 2007 Annual Meeting of Stockholders and the proxy nominee, write the nominee’s name in the space provided below.)

The undersigned(s) acknowledges receipt of the Notice of 2006 Annual Meeting of Stockholders and the proxy statement accompanying the same.
Dated:			, 2006
Signature
Signature ___, 2007 ___Signature ___Signature if held jointly
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY IN THE ENCLOSED ENVELOPE.
Please date this proxy and sign your name exactly as it appears hereon. If there is more than one owner, each should sign. When signing as an agent, attorney, administrator, guardian or trustee, please indicate your title as such. If executed by a corporation, this proxy should be signed in the corporate name by a duly authorized officer who should so indicate his or her title. FOLD AND DETACH HERE WE ENCOURAGE YOU TO TAKE ADVANTAGE OF INTERNET OR TELEPHONE VOTING, BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK. Internet and telephone voting is available through 11:59 PM Eastern Time the day prior to annual meeting day. Your Internet or telephone vote authorizes the named proxies to vote your shares in the same manner as if you marked, signed and returned your proxy card. INTERNET TELEPHONE http://www.proxyvoting.com/RCII 1-866-540-5760 Use the internet to vote your proxy. OR Use any touch-tone telephone to Have your proxy card in hand vote your proxy. Have your proxy when you access the web site. card in hand when you call. If you vote your proxy by Internet or by telephone, you do NOT need to mail back your proxy card. To vote by mail, mark, sign and date your proxy card and return it in the enclosed postage-paid envelope.

▲ FOLD AND DETACH HERE ▲