EMPLOYMENT AGREEMENT

(i)  

Willful and continued failure to perform substantially the Executive’s primary duties with Greyhound after Greyhound delivers to the Executive written demand for substantial performance, specifically identifying the manner in which the Executive has not substantially performed his duties;

(ii)  

Act of omission constituting fraud under the law of the State of Texas;

(iii)  

Conviction of, or plea of nolo contendere to a felony;

(iv)  

Use of illegal drugs;

(v)  

Embezzlement of Greyhound or Laidlaw property or funds;

(vi)  

Material breach of any provision of this Agreement, including but not limited to the covenants set forth in Section 6(d), or the unauthorized use of Greyhound’s confidential business information in a manner which is detrimental to Greyhound and/or Laidlaw.

(i)  

Greyhound’s failure to perform any material provision of this Agreement;

(ii)  

A material change in the Executive’s authority, duties or responsibilities under this Agreement, other than a termination by Greyhound for Cause;

(iii)  

Any request by the Greyhound Board that the Executive perform, assist, abet or approve any act which is illegal under any federal, state or local law;

(iv)  

Any requirement by the Greyhound Board that Executive relocate from the Dallas, Texas metropolitan area; or

(v)  

Greyhound fails to maintain adequate liability insurance coverage or indemnify executive in accordance with Articles 12 and 13 of this Agreement,

(a)  

Unless otherwise provided, all dollar amounts set forth in this Agreement shall be in United States Dollars. The Base Salary of the Executive for his services is established by the Committee at the annualized rate of $378,562. The Base Salary shall be payable twice monthly on the 15^th business day and the last business day of each month. The Base Salary shall be reviewed annually during Greyhound’s normal review period. The review will be undertaken by assessing the Executive’s achievement of the overall objectives established by the Committee in consultation with the Executive and with regard to the market rates of remuneration paid for similar duties and responsibilities.

(b)  

The Executive will be eligible to participate in Greyhound’s Short Term Incentive Plan as approved by the Committee. For fiscal years commencing September 1, 2003 and thereafter, the Executive’s target bonus shall be 50% of Base Salary and the maximum bonus shall be 100% of Base Salary. The Executive’s right to receive any bonus under Greyhound’s Short Term Incentive Plan shall be determined based only upon quantitative measurements established by the Committee and as set forth in accordance with Greyhound’s Short Term Incentive Plan.

(c)  

The Executive shall participate in the Greyhound Supplemental Executive Retirement Plan sponsored by Greyhound for the benefit of its employees in accordance with its terms; provided that Executive shall be credited with all service with Greyhound and any predecessors for purposes of the Greyhound Supplemental Executive Retirement Plan.

(d)  

Subject to approval by the Committee, the Executive will be eligible to receive grants of stock options of Laidlaw from time to time. Such stock options will be on terms and conditions established by the Committee.

(e)  

For the fiscal year commencing September 1, 2004, Greyhound will recommend to the Committee grants of deferred shares and value appreciation rights (VARs) to Executive under the terms of the Laidlaw Plan in the amount double the amount to be granted by the Committee in November, 2004. Such recommendation shall include four year ratable vesting on the deferred shares and 3-year cliff vesting on the VARs, with acceleration of vesting upon death or disability. The deferred shares will vest upon retirement, as defined in the Laidlaw Plan. VARs shall continue to vest for so long as Executive remains either employed by Greyhound or as a member of the Greyhound Board. All grants of deferred shares and VARs are subject to such terms and conditions as the Committee may actually approve and the Laidlaw Plan. There will be no other grants of deferred shares or VARs during the term of the Agreement.

(a)  

Automobile

Greyhound will provide the Executive with a monthly allowance of One Thousand Dollars ($1,000.00) for expenses incurred by the Executive for an automobile.

(b)  

Expenses

It is understood and agreed that the Executive will incur expenses in connection with his duties under this Agreement, including, but not limited to, travel expenses, home facsimile expenses, personal computer expenses and telephone expenses. Greyhound shall reimburse the Executive for any such expenses provided that the Executive provides to Greyhound an itemized written account and receipts acceptable to Greyhound.

(c)  

Vacation

The Executive shall be entitled to five (5) weeks vacation during each calendar year. The vacation shall be taken at the discretion of the Executive with the understanding that the Executive will take into account business needs and operations in scheduling vacation. All vacation earned must be taken by the end of the calendar year following accrual or it is forfeited.

(d)  

Welfare Benefits

The Executive shall be entitled to those welfare benefit coverages as are offered by Greyhound to its executive employees generally (such as medical insurance, dental insurance, short and long-term disability insurance and group term life insurance), all in accordance with the employee benefit plans and policies maintained by Greyhound for the benefit of employees of Greyhound, and as amended from time to time subject to and supplemented by the following:

(i)  

Medical: Greyhound shall pay the full cost of health and welfare benefit coverages for Executive. Greyhound will reimburse Executive for medical expenses up to $5,000 per calendar year; provided, that Executive provides to Greyhound appropriate evidence of such expenses as acceptable to Greyhound. Additionally, Greyhound will reimburse Executive for the cost of an annual physical performed by a mutually agreed upon physician.

(ii)  

Life Insurance: At all times during the term of this Agreement, Executive will receive life insurance coverage as provided by Greyhound on terms not less favorable than that provided to other executives of Greyhound. In addition to any life insurance provided pursuant to the preceding sentence, the Executive will be provided with company-paid life insurance which will provide death benefits in the event of his death in an amount of at least $1,500,000.00 payable to the beneficiary or beneficiaries named by the Executive. Greyhound shall have the right to purchase insurance to fund its obligations to the Executive under this section; provided,

however, that any insurance company or companies selected by Greyhound to fund its obligations under this section must be the company or companies that underwrite life insurance benefits covering other officers of Greyhound.

(iii)  

Long Term Disability: Greyhound will provide Executive long-term disability coverage and benefits on terms which are not less favorable than that provided to other executives of Greyhound but which will provide an annual disability benefit to the Executive of at least fifty percent (50%) of his expected annual Base Salary, payable for the year during which Executive was disabled.