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                                                                   EXHIBIT 10.16

                                                                      APPENDIX A

                      CHANGE IN CONTROL SEVERANCE AGREEMENT

Jeffrey W. Sanders
Laidlaw International, Inc.
55 Shuman Boulevard, Suite 400
Naperville, Illinois 60563

Dear Mr. Sanders:

         Laidlaw International, Inc. (the "Company") recognizes that, as is the
case for most companies, the possibility of a change in control exists. The
Company wishes to ensure that its senior executives are not distracted from
performing their duties in the event of a proposed or actual transaction
involving a change in control. Accordingly, the Company has determined that as
an additional inducement for you (the "Executive") to continue to remain in the
employ of the Company and to assure itself of both present and future continuity
of management, the Company agrees to provide the Executive with severance
benefits under the following circumstances pursuant to the following terms and
conditions (the "Agreement"):

                  1. Defined Terms. In addition to terms defined elsewhere
herein, the following terms have the following meanings when used in this
Agreement with initial capital letters:

                           (a) "Base Pay" means the Executive's annual base
         salary rate as in effect from time to time.

                           (b) "Board" means the Board of Directors of the
         Company.

                           (c) "Cause" means that, prior to any termination
         pursuant to Section 3(b), the Executive shall have:

                                    (i) engaged in misconduct which is
                           materially injurious to the Company, monetarily or
                           otherwise;

                                    (ii) committed an act of fraud, embezzlement
                           or theft in connection with his duties or in the
                           course of his employment with the Company or any
                           subsidiary;

                                    (iii) intentionally damaged property of the
                           Company or any subsidiary;

                                    (iv) committed wrongful disclosure of secret
                           processes or confidential information of the Company
                           or any Subsidiary; or

                                    (v) engaged in any Competitive Activity; and
                           any such act shall have been demonstrably and
                           materially harmful to the Company. Notwithstanding
                           the foregoing, the Executive shall not be deemed to
                           have

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                           been terminated for "Cause" hereunder unless and
                           until there shall have been delivered to the
                           Executive a copy of a resolution duly adopted by the
                           affirmative vote of not less than a majority of the
                           Board then in office (excluding the Executive if he
                           is a Director) at a meeting of the Board called and
                           held for such purpose, after reasonable notice to the
                           Executive and an opportunity for the Executive,
                           together with the Executive's counsel (if the
                           Executive chooses to have counsel present at such
                           meeting), to be heard before the Board, finding that,
                           in the good faith opinion of the Board, the Executive
                           had committed an act constituting "Cause" as herein
                           defined and specifying the particulars thereof in
                           detail. Nothing herein will limit the right of the
                           Executive or his beneficiaries to contest the
                           validity or propriety of any such determination;

                           (d) "Change in Control" means the occurrence during
         the Term of any of the following events:

                                    (i) the acquisition by any individual,
                           entity or group (within the meaning of Section
                           13(d)(3) or 14(d)(2) of the Exchange Act) (a
                           "Person") of beneficial ownership (within the meaning
                           of Rule 13d-3 promulgated under the Exchange Act) of
                           50% or more of the then-outstanding Voting Stock;
                           provided, however, that the following acquisitions
                           shall not constitute a Change in Control: (A) any
                           acquisition directly from the Company, (B) any
                           acquisition by the Company, (C) any acquisition by
                           any employee benefit plan (or related trust)
                           sponsored or maintained by the Company or any
                           Subsidiary or (D) any acquisition by any Person
                           pursuant to a transaction that complies with clauses
                           (A), (B) and (C) of subsection (iii) of this Section
                           1(d);

                                    (ii) individuals who, as of the date hereof,
                           constitute the Board (the "Incumbent Board") cease
                           for any reason (other than death or disability) to
                           constitute at least a majority of the Board;
                           provided, however, that any individual becoming a
                           director subsequent to the date hereof whose
                           election, or nomination for election by the Company's
                           stockholders, was approved by a vote of at least a
                           majority of the directors then comprising the
                           Incumbent Board (either by a specific vote or by
                           approval of the proxy statement of the Company in
                           which such person is named as a nominee for director,
                           without objection to such nomination) shall be
                           considered as though such individual were a member of
                           the Incumbent Board, but excluding for this purpose,
                           any such individual whose initial assumption of
                           office occurs as a result of an actual or threatened
                           election contest (within the meaning of Rule 14a-11
                           of the Exchange Act) with respect to the election or
                           removal of directors or other actual or threatened
                           solicitation of proxies or consents by or on behalf
                           of a Person other than the Board;

                                    (iii) consummation of a reorganization,
                           merger or consolidation or sale or other disposition
                           of all or substantially all of the assets of the

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                           Company (a "Business Combination"), unless, in each
                           case, immediately following such Business
                           Combination, (A) all or substantially all of the
                           individuals and entities who were the beneficial
                           owners of Voting Stock of the Company immediately
                           prior to such Business Combination beneficially own,
                           directly or indirectly, more than 50% of the then
                           outstanding shares of common stock and the combined
                           voting power of the then outstanding voting
                           securities entitled to vote generally in the election
                           of directors of the entity resulting from such
                           Business Combination (including, without limitation,
                           an entity which as a result of such transaction owns
                           the Company or all or substantially all of the
                           Company's assets either directly or through one or
                           more subsidiaries) in substantially the same
                           proportions relative to each other as their
                           ownership, immediately prior to such Business
                           Combination, of the Voting Stock of the Company, (B)
                           no Person (excluding any entity resulting from such
                           Business Combination or any employee benefit plan (or
                           related trust) sponsored or maintained by the
                           Company, any Subsidiary or such entity resulting from
                           such Business Combination) beneficially owns,
                           directly or indirectly, 15% or more of the then
                           outstanding shares of common stock of the entity
                           resulting from such Business Combination or the
                           combined voting power of the then outstanding voting
                           securities of such entity except to the extent such
                           ownership existed prior to the Business Combination
                           and (C) at least a majority of the members of the
                           board of directors of the entity resulting from such
                           Business Combination were members of the Incumbent
                           Board at the time of the execution of the initial
                           agreement or of the action of the Board providing for
                           such Business Combination; or

                                    (iv) approval by the stockholders of the
                           Company of a complete liquidation or dissolution of
                           the Company.

                           (e) "Competitive Activity" means the Executive's
         participation, without the written consent of the Board, as an
         employee, officer, consultant or director of any business enterprise if
         such enterprise engages in substantial and direct competition with the
         Company and such enterprise's sales of any product or service
         competitive with any product or service of the Company amounted to 10%
         of such enterprise's net sales for its most recently completed fiscal
         year and if the Company's net sales of said product or service amounted
         to 10% of the Company's net sales for its most recently completed
         fiscal year. "Competitive Activity" will not include (i) the mere
         ownership of securities in any such enterprise and the exercise of
         rights appurtenant thereto or (ii) participation in the management of
         any such enterprise other than in connection with the competitive
         operations of such enterprise.

                           (f) "Employee Benefits" means the perquisites,
         benefits and service credit for benefits as provided under any and all
         employee retirement income and welfare benefit policies, plans,
         programs or arrangements in which Executive is entitled to participate,
         including, without limitation, any stock option, performance share,
         performance unit, stock purchase, stock appreciation, savings, pension,
         supplemental

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         executive retirement, or other retirement income or welfare benefit,
         compensation, incentive compensation, group or other life, health,
         medical/hospital or other insurance (whether funded by actual insurance
         or self-insured by the Company or a Subsidiary), disability, salary
         continuation, expense reimbursement and other employee benefit
         policies, plans, programs or arrangements.

                           (g) "Exchange Act" means the Securities Exchange Act
         of 1934.

                           (h) "Incentive Pay" means an annual bonus, incentive
         or other payment of compensation, in addition to Base Pay, made or to
         be made in regard to services rendered in any year or other period
         pursuant to any bonus, incentive, profit-sharing, performance,
         discretionary pay or similar agreement, policy, plan, program or
         arrangement (whether or not funded) of the Company or a Subsidiary, or
         any successor thereto.

                           (i) "Retirement Plans" means the retirement income,
         supplemental executive retirement, excess benefits and retiree medical,
         life and similar benefit plans, programs or arrangements of the Company
         in which the Executive is entitled to participate.

                           (j) "Severance Period" means the period of time
         commencing on the date of the first occurrence of a Change in Control
         and continuing until the earlier of (i) the second anniversary of the
         occurrence of the Change in Control, or (ii) the Executive's death.

                           (k) "Subsidiary" means an entity in which the Company
         directly or indirectly beneficially owns 50% or more of the outstanding
         Voting Stock.

                           (l) "Term" means the period commencing as of the date
         hereof and expiring as of the later of (i) the close of business on
         August 31, 2005, or (ii) the expiration of the Severance Period;
         provided, however, that (A) commencing on September 1, 2005 and each
         September 1 thereafter, the term of this Agreement will automatically
         be extended for an additional year unless, not later than June 30 of
         the immediately preceding year, the Company or the Executive shall have
         given notice that it or the Executive, as the case may be, does not
         wish to have the Term extended and (B) subject to the last sentence of
         Section 9, if, prior to a Change in Control, the Executive ceases for
         any reason to be an employee of the Company and any Subsidiary,
         thereupon without further action the Term shall be deemed to have
         expired and this Agreement will immediately terminate and be of no
         further effect. For purposes of this Section 1(l), the Executive shall
         not be deemed to have ceased to be an employee of the Company and any
         Subsidiary by reason of the transfer of Executive's employment between
         the Company and any Subsidiary, or among any Subsidiaries.

                           (m) "Termination Date" means the date on which the
         Executive's employment is terminated (the effective date of which shall
         be the date of termination, or such other date that may be specified by
         the Executive if the termination is pursuant to Section 3(b)).

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                           (n) "Voting Stock" means securities entitled to vote
         generally in the election of directors.

                  2. Operation of Agreement. This Agreement will be effective
and binding immediately upon its execution, but, anything in this Agreement to
the contrary notwithstanding, except as provided in Sections 8 and 9, this
Agreement will not be operative unless and until a Change in Control occurs.
Upon the occurrence of a Change in Control at any time during the Term, without
further action, this Agreement shall become immediately operative.

                  3. Termination Following a Change in Control.

                           (a) In the event of the occurrence of a Change in
         Control, the Executive's employment may be terminated by the Company or
         a Subsidiary during the Severance Period and the Executive shall be
         entitled to the benefits provided by Section 4 unless such termination
         is the result of the occurrence of one or more of the following events:

                                    (i) The Executive's death;

                                    (ii) If the Executive becomes permanently
                  disabled within the meaning of, and begins actually to receive
                  disability benefits pursuant to, the long-term disability plan
                  in effect for, or applicable to, Executive immediately prior
                  to the Change in Control; or

                                    (iii) Cause.

                  If, during the Severance Period, the Executive's employment is
terminated by the Company or any Subsidiary other than pursuant to Section
3(a)(i), 3(a)(ii) or 3(a)(iii), the Executive will be entitled to the benefits
provided by Section 4 hereof.

                           (b) In the event of the occurrence of a Change in
         Control, the Executive may terminate employment with the Company and
         any Subsidiary during the Severance Period with the right to severance
         compensation as provided in Section 4 upon the occurrence of one or
         more of the following events (regardless of whether any other reason,
         other than Cause as hereinabove provided, for such termination exists
         or has occurred, including, without limitation, other employment):

                                    (i) Failure to elect or reelect or otherwise
                  to maintain the Executive in the office or the position, or a
                  substantially equivalent office or position, of or with the
                  Company and/or a Subsidiary (or any successor thereto by
                  operation of law or otherwise), as the case may be, which the
                  Executive held immediately prior to a Change in Control, or
                  the removal of the Executive as a director of the Company
                  and/or a Subsidiary (or any successor thereto) if the
                  Executive shall have been a director of the Company and/or a
                  Subsidiary immediately prior to the Change in Control;

                                    (ii) (A) A significant adverse change in the
                  nature or scope of the authorities, powers, functions,
                  responsibilities or duties attached to the

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                  position with the Company and any Subsidiary which the
                  Executive held immediately prior to the Change in Control, (B)
                  a reduction in the aggregate of the Executive's Base Pay
                  received from the Company and any Subsidiary or the
                  Executive's Incentive Pay opportunity from the Company or its
                  Subsidiaries, or (C) the termination or denial of the
                  Executive's rights to Employee Benefits or a reduction in the
                  scope or value thereof to a level that is substantially lower
                  in the aggregate from the level in effect at the time of the
                  Change in Control, any of which is not remedied by the Company
                  within 10 calendar days after receipt by the Company of
                  written notice from the Executive of such change, reduction,
                  denial or termination, as the case may be;

                                    (iii) The liquidation, dissolution, merger,
                  consolidation or reorganization of the Company or transfer of
                  all or substantially all of its business and/or assets, unless
                  the successor or successors (by liquidation, merger,
                  consolidation, reorganization, transfer or otherwise) to which
                  all or substantially all of its business and/or assets have
                  been transferred (by operation of law or otherwise) assumed
                  all duties and obligations of the Company under this Agreement
                  pursuant to Section 12(a);

                                    (iv) The Company relocates its principal
                  executive offices (if such offices are the principal location
                  of Executive's work), or requires the Executive to have his
                  principal location of work changed, to any location that, in
                  either case, is in excess of 50 miles from the location
                  thereof immediately prior to the Change in Control, or
                  requires the Executive to travel away from his office in the
                  course of discharging his responsibilities or duties hereunder
                  at least 20% more (in terms of aggregate days in any calendar
                  year or in any calendar quarter when annualized for purposes
                  of comparison to any prior year) than was required of
                  Executive in any of the three full years immediately prior to
                  the Change in Control without, in either case, his prior
                  written consent; or

                                    (v) Without limiting the generality or
                  effect of the foregoing, any material breach of this Agreement
                  by the Company or any successor thereto which is not remedied
                  by the Company within 10 calendar days after receipt by the
                  Company of written notice from the Executive of such breach.

                           (c) Except as otherwise provided herein, a
         termination by the Company pursuant to Section 3(a) or by the Executive
         pursuant to Section 3(b) will not affect any rights that the Executive
         may have pursuant to any agreement, policy, plan, program or
         arrangement of the Company or Subsidiary providing Employee Benefits,
         which rights shall be governed by the terms thereof, except for any
         rights to severance compensation to which Executive may be entitled
         upon termination of employment pursuant to Paragraph 6(a)(iii) of the
         Executive's employment agreement, dated August 20, 2004, which rights
         shall, during the Severance Period, be superseded by this Agreement.

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                  4. Severance Compensation.

                           (a) If, following the occurrence of a Change in
         Control, the Company or Subsidiary terminates the Executive's
         employment during the Severance Period other than pursuant to Section
         3(a)(i), 3(a)(ii) or 3(a)(iii), or if the Executive terminates his
         employment pursuant to Section 3(b), the Company shall pay to the
         Executive the amounts described in Annex A within five business days
         after the Termination Date and shall provide to the Executive the
         benefits described on Annex A for the periods described therein.

                           (b) Without limiting the rights of the Executive at
         law or in equity, in the event it is determined that the Company fails
         to make any payment or provide any benefit required to be made or
         provided hereunder on a timely basis, the Company shall pay interest on
         the amount or value thereof at an annualized rate of interest equal to
         the so-called composite "prime rate" as quoted from time to time during
         the relevant period in The Wall Street Journal, plus 4%. Any change in
         such prime rate shall be effective on and as of the date of such
         change.

                           (c) Notwithstanding any provision of this Agreement
         to the contrary, the parties' respective rights and obligations under
         this Section 4 and under Sections 5, 7, 8 and the last sentence of
         Section 9 will survive any termination or expiration of this Agreement
         or the termination of the Executive's employment following a Change in
         Control for any reason whatsoever.

                           (d) Notwithstanding any provision to the contrary in
         any applicable plan, program or agreement, upon the occurrence of a
         Change in Control, all equity incentive awards held by the Executive
         shall become fully vested and all stock options held by the Executive
         shall become fully exercisable.

                  5. Limitation on Payments and Benefits. Notwithstanding any
provision of this Agreement to the contrary, if any amount or benefit to be paid
or provided under this Agreement would be an "Excess Parachute Payment," within
the meaning of Section 280G of the Internal Revenue Code of 1986, as amended
(the "Code"), or any successor provision thereto, but for the application of
this sentence, then the payments and benefits to be paid or provided under this
Agreement shall be reduced to the minimum extent necessary (but in no event to
less than zero) so that no portion of any such payment or benefit, as so
reduced, constitutes an Excess Parachute Payment; provided, however, that the
foregoing reduction shall be made only if and to the extent that such reduction
would result in an increase in the aggregate payment and benefits to be
provided, determined on an after-tax basis (taking into account the excise tax
imposed pursuant to Section 4999 of the Code, or any successor provision
thereto, any tax imposed by any comparable provision of state law, and any
applicable federal, state and local income taxes). The determination of whether
any reduction in such payments or benefits to be provided under this Agreement
or otherwise is required pursuant to the preceding sentence shall be made at the
expense of the Company, if requested by the Executive or the Company, by the
Company's independent accountants. The fact that the Executive's right to
payments or benefits may be reduced by reason of the limitations contained in
this Section 5 shall not of itself limit or otherwise affect any other rights of
the Executive other than pursuant to this Agreement. In the

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event that any payment or benefit intended to be provided under this Agreement
or otherwise is required to be reduced pursuant to this Section 5, the Executive
shall be entitled to designate the payments and/or benefits to be so reduced in
order to give effect to this Section 5. The Company shall provide the Executive
with all information reasonably requested by the Executive to permit the
Executive to make such designation. In the event that the Executive fails to
make such designation within 10 business days of the Termination Date, the
Company may effect such reduction in any manner it deems appropriate.

                  6. No Mitigation Obligation. The Company hereby acknowledges
that it will be difficult and may be impossible for the Executive to find
reasonably comparable employment following the Termination Date. Accordingly,
the payment of the severance compensation by the Company to the Executive in
accordance with the terms of this Agreement is hereby acknowledged by the
Company to be reasonable, and the Executive will not be required to mitigate the
amount of any payment provided for in this Agreement by seeking other employment
or otherwise, nor will any profits, income, earnings or other benefits from any
source whatsoever create any mitigation, offset, reduction or any other
obligation on the part of the Executive hereunder or otherwise, except as
expressly provided in the last sentence of Section 2 set forth on Annex A.

                  7. Legal Fees and Expenses. It is the intent of the Company
that the Executive not be required to incur legal fees and the related expenses
associated with the interpretation, enforcement or defense of Executive's rights
under this Agreement by litigation or otherwise because the cost and expense
thereof would substantially detract from the benefits intended to be extended to
the Executive hereunder. Accordingly, if the Executive reasonably believes that
the Company has failed to comply with any of its obligations under this
Agreement or in the event that the Company or any other person takes or
threatens to take any action to declare this Agreement void or unenforceable, or
institutes any litigation or other action or proceeding designed to deny, or to
recover from, the Executive the benefits provided or intended to be provided to
the Executive hereunder, subject to the other provisions of this Section 7, the
Company irrevocably authorizes the Executive from time to time to retain counsel
of Executive's choice, at the expense of the Company to the extent and as
hereafter provided, to advise and represent the Executive in connection with any
such interpretation, enforcement or defense, including, without limitation, the
initiation or defense of any litigation or other legal action, whether by or
against the Company or any director, officer, stockholder or other person
affiliated with the Company, in any jurisdiction. Notwithstanding any existing
or prior attorney-client relationship between the Company and such counsel, the
Company irrevocably consents to the Executive's entering into an attorney-client
relationship with such counsel, and in that connection the Company and the
Executive agree that a confidential relationship shall exist between the
Executive and such counsel. The Company will pay and be solely responsible for
any and all attorneys' and related fees and expenses incurred by the Executive
in connection with any of the foregoing, except to the extent that the Executive
fails to prevail on a material claim in any such proceeding described in this
Section 7.

                  8. Confidentiality. The Executive acknowledges that in the
course of his employment by the Company, he will or may have access to and
become informed of confidential or proprietary information (as defined in this
Section 8) of the Company. The Executive hereby covenants and agrees that he
will not, without the prior written consent of the

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Company, during the Term or thereafter disclose to any person not employed by
the Company, or use in connection with engaging in competition with the Company,
any confidential or proprietary information of the Company. For purposes of this
Agreement, the term "confidential or proprietary information" will include all
information of any nature and in any form that is owned by the Company and that
is not publicly available (other than by Executive's breach of this Section 8)
or generally known to persons engaged in businesses similar or related to those
of the Company. Confidential or proprietary information will include, without
limitation, the Company's financial matters, customers, employees, industry
contracts, strategic business plans, product development (or other proprietary
product data), marketing plans, and all other secrets and all other information
of a confidential or proprietary nature. For purposes of the preceding two
sentences, the term "Company" will also include any Subsidiary (collectively,
the "Restricted Group"). The foregoing obligations imposed by this Section 8
will not apply (i) during the Term, in the course of the business of and for the
benefit of the Company, (ii) if such confidential or proprietary information
will have become, through no fault of the Executive, generally known to the
public or (iii) if the Executive is required by law to make disclosure (after
giving the Company notice and an opportunity to contest such requirement).

                  9. Employment Rights. Nothing expressed or implied in this
Agreement will create any right or duty on the part of the Company or the
Executive to have the Executive remain in the employment of the Company or any
Subsidiary prior to or following any Change in Control. Any termination of
employment of the Executive or the removal of the Executive from the office or
position in the Company or any Subsidiary that occurs (i) not more than 90 days
prior to the date on which a Change in Control occurs, and (ii) following the
commencement of any discussion with a third person that ultimately results in a
Change in Control, shall be deemed to be a termination or removal of the
Executive after a Change in Control for purposes of this Agreement.

                  10. Post-termination Assistance. Executive shall provide such
information and assistance to the Company as the Company may reasonably request,
upon reasonable notice, in connection with any litigation in which it or any of
its affiliates is or may become a party. The Company shall reimburse the
Executive for any expenses, including travel expenses, incurred by the Executive
in connection with providing such information and assistance.

                  11. Withholding of Taxes. The Company may withhold from any
amounts payable under this Agreement all federal, state, city or other taxes as
the Company is required to withhold pursuant to any applicable law, regulation
or ruling.

                  12. Successors and Binding Agreement.

                           (a) The Company will require any successor (whether
         direct or indirect, by purchase, merger, consolidation, reorganization
         or otherwise) to all or substantially all of the business or assets of
         the Company, by agreement in form and substance reasonably satisfactory
         to the Executive, expressly to assume and agree to perform this
         Agreement in the same manner and to the same extent the Company would
         be required to perform if no such succession had taken place. This
         Agreement will be binding upon and inure to the benefit of the Company
         and any successor to the Company, including, without limitation, any
         persons acquiring directly or indirectly all or

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         substantially all of the business or assets of the Company whether by
         purchase, merger, consolidation, reorganization or otherwise (and such
         successor shall thereafter be deemed the "Company" for the purposes of
         this Agreement), but will not otherwise be assignable, transferable or
         delegable by the Company.

                           (b) This Agreement will inure to the benefit of and
         be enforceable by the Executive's personal or legal representatives,
         executors, administrators, successors, heirs, distributees and
         legatees.

                           (c) This Agreement is personal in nature and neither
         of the parties hereto shall, without the consent of the other, assign,
         transfer or delegate this Agreement or any rights or obligations
         hereunder except as expressly provided in Sections 12(a) and 12(b).
         Without limiting the generality or effect of the foregoing, the
         Executive's right to receive payments hereunder will not be assignable,
         transferable or delegable, whether by pledge, creation of a security
         interest, or otherwise, other than by a transfer by Executive's will or
         by the laws of descent and distribution and, in the event of any
         attempted assignment or transfer contrary to this Section 12(c), the
         Company shall have no liability to pay any amount so attempted to be
         assigned, transferred or delegated.

                  13. Notices. For all purposes of this Agreement, all
communications, including, without limitation, notices, consents, requests or
approvals, required or permitted to be given hereunder will be in writing and
will be deemed to have been duly given when hand delivered or dispatched by
electronic facsimile transmission (with receipt thereof orally confirmed), or
five business days after having been mailed by United States registered or
certified mail, return receipt requested, postage prepaid, or three business
days after having been sent by a nationally recognized overnight courier service
(such as Federal Express or UPS) addressed to the Company (to the attention of
the Secretary of the Company) at its principal executive office and to the
Executive at his principal residence, or to such other address as any party may
have furnished to the other in writing and in accordance herewith, except that
notices of changes of address shall be effective only upon receipt.

                  14. Governing Law. The validity, interpretation, construction
and performance of this Agreement will be governed by and construed in
accordance with the substantive laws of the State of Delaware, without giving
effect to the principles of conflict of laws of such State.

                  15. Validity. If any provision of this Agreement or the
application of any provision hereof to any person or circumstances is held
invalid, unenforceable or otherwise illegal, the remainder of this Agreement and
the application of such provision to any other person or circumstances will not
be affected, and the provision so held to be invalid, unenforceable or otherwise
illegal will be reformed to the extent (and only to the extent) necessary to
make it enforceable, valid or legal.

                  16. Miscellaneous. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing signed by the Executive and the Company. No waiver by
either party hereto at any time of any breach by the other party hereto or
compliance with any condition or provision of this Agreement to be

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performed by such other party will be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. No
agreements or representations, oral or otherwise, expressed or implied with
respect to the subject matter hereof have been made by either party which are
not set forth expressly in this Agreement. References to Sections are to
references to Sections of this Agreement.

                  17. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same agreement.

          IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the date first above written.

                                   LAIDLAW INTERNATIONAL, INC.

                                   _____________________________________________
                                   By:  Beth Byster Corvino
                                   Its: Senior Vice President, General Counsel
                                        and Corporate Secretary

                                   _____________________________________________
                                   By:  Jeffrey W. Sanders

                                   Date:________________________________________

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                                     ANNEX A

                  1. The Company shall pay to the Executive a lump sum payment
in an amount equal to two (2) times the sum of (A) Base Pay (at the highest rate
in effect for any period prior to the Termination Date), plus (B) Incentive Pay
(in an amount equal to not less than the higher of (x) the highest aggregate
Incentive Pay earned in any fiscal year after the Change in Control or in any of
the three fiscal years immediately preceding the year in which the Change in
Control occurred or (y) the plan target for which the year in which the Change
in Control occurred).

                  2. The Company shall, for a period of twenty four (24) months
following the Termination Date (the "Continuation Period"), arrange to provide
the Executive with Employee Benefits that are welfare benefits (but not stock
option, stock purchase, stock appreciation or similar compensatory benefits)
substantially similar to those that the Executive was receiving or entitled to
receive immediately prior to the Termination Date (or, if greater, immediately
prior to the reduction, termination or denial described in Section 3(b)(ii)),
except that the level of any such Employee Benefits to be provided to the
Executive may be reduced in the event of a corresponding reduction generally
applicable to all recipients of or participants in such Employee Benefits, which
Continuation Period will be considered service with the Company for the purpose
of determining service credits and benefits due and payable to the Executive
under the Company's retirement income, supplemental executive retirement and
other benefit plans of the Company applicable to the Executive, his dependents
or his beneficiaries immediately prior to the Termination Date. Without
otherwise limiting the purpose or effect of Section 5, Employee Benefits
otherwise receivable by the Executive pursuant to this Section 2 will be reduced
to the extent comparable welfare benefits are actually received by the Executive
from another employer during the Continuation Period following the Executive's
Termination Date, and any such benefits actually received by the Executive shall
be reported by the Executive to the Company.

                  3. In addition to the retirement income, supplemental
executive retirement, and other benefits to which Executive is entitled under
the Retirement Plans, a lump sum payment in an amount equal to the actuarial
equivalent of the excess of (x) the retirement pension and the medical, life and
other benefits that would be payable to the Executive under the Retirement Plans
if Executive continued to be employed through the Continuation Period given the
Executive's Base Pay (as determined in Section 1) (without regard to any
amendment to the Retirement Plans made subsequent to a Change in Control which
adversely affects in any manner the computation of retirement or welfare
benefits thereunder), over (y) the retirement pension and the medical, life and
other benefits that the Executive is entitled to receive (either immediately or
on a deferred basis) under the Retirement Plans. For purposes of this Section,
"actuarial equivalent" shall be determined using the actuarial assumptions
mandated under Section 417(e)(3) of the Code in effect for the month second
preceding the date of payment and the Continuation Period will be considered
service with the Company for the purpose of determining service credits and
benefits due and payable to the Executive under the Company's retirement pension
and medical, life and other benefit plans of the Company applicable to the
Executive, his dependents or his beneficiaries immediately prior to the
Termination Date.

                  4. Reasonable outplacement services by a firm selected by the
Executive, at the expense of the Company, in an amount up to $25,000.

                                     Annex 1<PAGE>

                                                                   EXHIBIT 10.17

THIS AGREEMENT MADE EFFECTIVE THE 20TH DAY OF AUGUST, 2004.

Between:

         Laidlaw International, Inc., a Delaware corporation ("Laidlaw")

                                       and

                      Jeffery A. McDougle (the "Executive")

WHEREAS, Laidlaw desires to employ the Executive and the Executive desires to be
employed by Laidlaw;

NOW THEREFORE, the parties have agreed that the terms and conditions of the
relationship shall be as follows:

ARTICLE 1 -- DEFINITIONS

Whenever used in this Agreement, the following terms shall have the meanings set
forth below, and when the meaning is intended, the initial letter of the word is
capitalized:

(a)      "Agreement" means this employment agreement, as amended from time to
         time.

(b)      "Base Salary" means the salary of record paid to the Executive as
         annual salary, and as further indicated in paragraph (a) of Article 4
         (Compensation).

(c)      "Board" means the Board of Directors of Laidlaw.

(d)      "Cause" means the Executive's:

         (i)      Willful and continued failure to perform substantially the
                  Executive's duties with Laidlaw after Laidlaw delivers to the
                  Executive written demand for substantial performance,
                  specifically identifying the manner in which the Executive has
                  not substantially performed his duties;

         (ii)     Conviction of an indictable offense; or

         (iii)    Willfully engaging in illegal conduct or gross misconduct
                  which is materially and demonstrably injurious to Laidlaw.

         For purposes of this paragraph and Article 13, no act or omission by
         the Executive shall be considered "willful" unless it is done or
         omitted in bad faith or without reasonable belief that the Executive's
         action or omission was in the best interests of Laidlaw.

(e)      "Committee" means the Compensation Committee of the Board.

                                       1
<PAGE>

(f)      "Effective Date" means August 20, 2004.

(g)      "Executive" shall mean Jeffery A. McDougle.

(h)      "Laidlaw" shall mean Laidlaw International Inc., a Delaware
         corporation, including any and all subsidiaries or any successor
         thereto.

ARTICLE 2 -- TERM OF THE AGREEMENT

The term of this Agreement shall commence on the Effective Date and shall
continue until terminated in accordance with the provisions of this Agreement.

ARTICLE 3 -- TITLE; COMMENCEMENT OF EMPLOYMENT; REPORTING

The Executive shall serve as the Vice President and Treasurer of Laidlaw. The
Executive shall report to the Chief Financial Officer.

ARTICLE 4 -- COMPENSATION

(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 $260,000. The Base Salary shall be payable twice
         monthly on the 15th business day and the last business day of each
         month. The Base Salary shall be reviewed annually during Laidlaw'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 Laidlaw's Short Term
         Incentive Plan. For the fiscal year commencing September 1, 2004, 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 Laidlaw's Short Term Incentive Plan shall be determined
         based only upon quantitative measurements established by the Committee
         after consultation with the Executive and as set forth in accordance
         with Laidlaw's Short Term Incentive Plan.

(c)      The Executive shall participate in The Supplemental Executive
         Retirement Plan sponsored by Laidlaw for the benefit of its employees.

(d)      Subject to approval by the Committee, the Executive will be eligible to
         receive grants of stock options from time to time. Such stock options
         will be on terms and conditions established by the Committee after
         consultation with the Executive.

                                       2
<PAGE>

ARTICLE 5 -- BENEFITS

(a)      AUTOMOBILE

         Laidlaw will provide the Executive with a monthly allowance of Seven
         Hundred Fifty Dollars ($750.00) for expenses incurred by the Executive
         for an automobile and its related operating expenses.

(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. Laidlaw shall reimburse the Executive
         for any such expenses provided that the Executive provides to Laidlaw
         an itemized written account and receipts acceptable to Laidlaw.

(c)      VACATION

         The Executive shall be entitled to four (4) 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 Laidlaw to its 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 Laidlaw for the benefit of
         employees of Laidlaw, and as amended from time to time.

(e)      EXECUTIVE BENEFIT STIPEND

         Laidlaw shall pay the Executive an annual sum equal to Twenty Thousand
         Dollars ($20,000.00), in two equal installments (on January 1 and July
         1 of each year), grossed up to enable Executive to pay applicable
         income taxes. Such Stipend is intended to cover items such as
         automobile expenses, club memberships and professional advice.

ARTICLE 6 -- TERMINATION OF EMPLOYMENT

(a)      The parties understand and agree that this Agreement and the
         Executive's employment hereunder may be terminated in the following
         manner in the specified circumstances:

         (i)      By the Executive, at any time, for any reason, on the giving
                  of 90 days' written notice to Laidlaw. Laidlaw may waive
                  notice, in whole or in part, upon immediate payment to the
                  Executive of the Executive's Base Salary for such portion of
                  the 90-day notice period as is waived by Laidlaw.

         (ii)     By Laidlaw, in its absolute discretion, without any notice or
                  pay in lieu thereof, for Cause.

                                       3
<PAGE>

         (iii)    By Laidlaw, in its absolute discretion and for any reason,
                  without Cause. Upon such termination, Laidlaw shall (A)
                  continue to pay the Executive his Base Salary in effect at the
                  time of such termination for a period of 12 months following
                  such termination, (B) provided such termination is following
                  the second anniversary of his employment with Laidlaw (or any
                  predecessor thereto) pay the Executive a monthly amount equal
                  to one-twelfth of the Executive's target bonus in effect at
                  the time of Executive's termination of employment for a period
                  of 12 months following such termination, and (C) shall
                  continue to provide the Executive medical insurance, dental
                  insurance and term life insurance for a period of 12 months
                  after termination, or, if such benefits cannot be provided by
                  Laidlaw, Laidlaw shall pay to the Executive an equivalent lump
                  sum cash amount in lieu of such benefits.

         In order to receive the entitlement under this paragraph, the Executive
         must undertake to sign a release in a form satisfactory to Laidlaw,
         fully releasing Laidlaw from further claims upon payment of the amounts
         stipulated herein. However, the form of release shall not require that
         the Executive give up any rights of indemnity which the Executive may
         have had as against Laidlaw for acts carried out by the Executive in
         the ordinary course of Laidlaw's business.

(b)      The Executive agrees that during employment pursuant to this Agreement
         and for twelve (12) months following termination without Cause of his
         employment by Laidlaw and payment of the severance payment amount and
         benefit continuation as detailed in subparagraph (iii) of paragraph (a)
         of Article 6 (Termination of Employment), he will not solicit or accept
         business with respect to products competitive with those of Laidlaw
         from any of Laidlaw's customers, wherever situated, and he shall not
         either individually or in partnership, or jointly in conjunction with
         any other person, entity or organization, as principal, agent,
         consultant, lender, contractor, employer, employee, investor,
         shareholder, or in any other manner, directly or indirectly, advise,
         manage, carry on, establish, control, engage in, invest in, offer
         financial assistance or services to, or permit his name to be used by
         any business that competes with the then-existing business of Laidlaw,
         provided that the Executive shall be entitled, for investment purposes,
         to purchase and trade shares of a public company which are listed and
         posted for trading on a recognized stock exchange and the business of
         which public company may be in competition with the business of
         Laidlaw, provided that the Executive shall not directly or indirectly
         own more than five percent (5%) of the issued share capital of the
         public company, or participate in its management or operation, or in
         any advisory capacity within the time limits set out herein.

         For purposes of the obligations set out herein, the business of Laidlaw
         shall mean the provision of contract bus services for school bus
         transportation throughout Canada and the United States and municipal
         and paratransit bus transportation within the United States, inter-city
         and tourism bus transportation throughout North America and healthcare
         transportation services and emergency management services in the United
         States.

(c)      The Executive further agrees that for a period of twelve (12) months
         following termination of employment, however caused, he will not
         solicit for hire or rehire, or take away, or cause to be hired, or
         taken away, any employee of Laidlaw.

                                       4
<PAGE>

ARTICLE 7 -- AUTHORITY

(a)      The Executive shall support the Chief Financial Officer in carrying out
         the general or specific instructions and directions of the Chief
         Executive Officer and the Board and together with the Chief Financial
         Officer in doing so, may enter into contracts, engagements or
         commitments of every nature or kind, in the name of and on behalf of
         Laidlaw, and may engage, employ and dismiss all managers and other
         employees and agents of Laidlaw, subject to the by-laws and charter
         documents of the Company and the authority given him by the Company
         from time to time.

(b)      The Executive shall conform to all lawful instructions and directions
         given to him by the Chief Financial Officer, the Chief Executive
         Officer, and the Board and obey and carry out the by-laws of Laidlaw.

ARTICLE 8 -- SERVICE

(a)      The Executive, throughout the term of his employment, shall devote his
         full time and attention to the business and affairs of Laidlaw, and
         shall not undertake any other business or occupation or, unless
         approved by the Chief Financial Officer, become either (i) an officer,
         employee or agent of any other company or firm which is a commercial
         venture or (ii) a director of more than two companies or firms which
         are commercial ventures.

(b)      The Executive shall well and faithfully serve Laidlaw and use his best
         efforts to promote the interests thereof and shall not disclose any
         information he may acquire in relation to Laidlaw's business, the
         private affairs or trade secrets of Laidlaw, techniques and concepts,
         and other confidential information concerning the business, operations
         or financing of Laidlaw, to any person other than the Board, or for any
         purposes other than those of Laidlaw, either during the term of his
         employment under this Agreement or after such term.

ARTICLE 9 -- CHANGE IN CONTROL

(a)      If a change in control (as defined in the Change in Control Agreement)
         occurs, the rights and obligations of the Executive and Laidlaw shall
         be in accordance with the Change in Control Agreement attached as
         Appendix A.

(b)      In order to receive the entitlement under this paragraph, the Executive
         must undertake to sign a release in a form satisfactory to Laidlaw,
         fully releasing Laidlaw from further claims upon payment of the amounts
         stipulated in Appendix A. However, the form of release shall not
         require that the Executive give up any rights of indemnity which the
         Executive may have had as against Laidlaw for acts carried out by the
         Executive in the ordinary course of Laidlaw's business.

If a change in control occurs and Executive receives all payments under the
Change in Control Agreement, the Executive hereby waives any rights he may have
to any payments or other benefits under this Agreement, including any severance
payments.

                                       5
<PAGE>

ARTICLE 10 -- ASSIGNMENT OF RIGHTS

The rights which accrue to Laidlaw under this Agreement shall pass to their
affiliates, successors or assigns. The rights of the Executive under this
Agreement are not assignable or transferable in any manner but flow to the
Executive's estate and heirs.

ARTICLE 11 -- NOTICES

All notices and other communications required or permitted hereunder, or
necessary or convenient in connection herewith, shall be in writing and shall be
deemed to have been given when hand delivered, delivered by facsimile or mailed
by registered mail as follows (provided that notice of change of address shall
be deemed given only when received):

If to Laidlaw, to:

         Laidlaw International, Inc.
         55 Shuman Boulevard, Suite 400
         Naperville, IL 60563

If to the Executive, at such address as Executive provides to Laidlaw from time
to time as part of his personnel records, or to such other names or addresses as
Laidlaw or the Executive shall designate by notice to the other in the manner
specified in this paragraph.

ARTICLE 12 -- LIABILITY INSURANCE

Laidlaw shall maintain the Executive's liability insurance in accordance with
Laidlaw's corporate policy and applicable law.

ARTICLE 13 -- INDEMNIFICATION

Laidlaw agrees that if the Executive is made a party to any action, suit,
proceeding or any other claim whatsoever, by reason of the fact that the
Executive is or was a director, officer, employee or agent of Laidlaw, or is or
was serving at the request of Laidlaw as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other enterprise,
whether or not the basis of such claim is the Executive's alleged action in an
official capacity while in service as a director, officer, employee or agent of
Laidlaw, the Executive shall be indemnified and held harmless by Laidlaw to the
fullest extent legally permitted or authorized by Laidlaw's certificate of
incorporation or bylaws or Board resolutions against all expenses, liability and
loss, including, without limitation, legal fees, fines or penalties and amounts
paid or to be paid in settlement, all as reasonably incurred by the Executive in
connection therewith, and such indemnification shall continue as to the
Executive even after the Executive has ceased to be a director, officer,
employee or agent of Laidlaw, and shall inure to the benefit of the Executive's
heirs, executors and administrators.

ARTICLE 14 -- WITHHOLDING OF TAXES

                                       6
<PAGE>

Laidlaw shall be entitled to withhold from any amounts payable under this
Agreement all taxes as legally shall be required pursuant to applicable federal,
state or local laws. Laidlaw shall not be obligated to compensate the Executive
for the payment of such taxes.

ARTICLE 15 -- SEVERABILITY

If any provision of this Agreement or the application thereof to anyone, or
under any circumstances, is adjudicated to be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect any other
provision or application of this Agreement which can be given effect without the
invalid or unenforceable provision or application and shall not invalidate or
render unenforceable such provision or application in any other jurisdiction.

ARTICLE 16 -- ENTIRE AGREEMENT

This Agreement, including Appendix A hereto, constitutes the entire agreement
between the parties with respect to the employment and appointment of the
Executive and any and all previous agreements, written or oral, express or
implied, between the parties or on their behalf, relating to the employment and
appointment of the Executive by Laidlaw, are terminated and cancelled and each
of the parties releases and forever discharges the other of and from all manner
of actions, causes of action, claims and demands whatsoever, under or in respect
of any previous agreement; provided, however that this does not cancel or
terminate the separate indemnification agreement between Laidlaw and the
Executive.

ARTICLE 17 -- AMENDMENT, WAIVER, ETC.

No provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing and signed by the
Executive and Laidlaw. No waiver by any party hereto at any time of any breach
by any other party hereto of, or compliance with, any condition of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time.

ARTICLE 18 -- HEADINGS

The headings used in this Agreement are for convenience only and are not to be
construed in any way as additions to or limitations of the covenants and
agreements contained in it.

ARTICLE 19 -- COUNTERPARTS

This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original but all of which together will constitute one and
the same instrument.

ARTICLE 20 -- GENDER AND NUMBER

Except where otherwise indicated by the context, any masculine term used herein
shall also include the feminine; the plural shall include the singular, the
singular shall include the plural.

ARTICLE 21 -- GOVERNING LAW

                                       7
<PAGE>

This Agreement shall be governed by the internal law, and not the laws of
conflicts, of the State of Delaware.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the 20th day
of August, 2004.

                                   LAIDLAW INTERNATIONAL INC.

                                   BY:__________________________________________
                                   NAME: BETH BYSTER CORVINO
                                   TITLE: SENIOR VICE PRESIDENT, GENERAL COUNSEL

                                   EXECUTIVE

                                   _____________________________________________
                                   Jeffery A. McDougle

                                       8

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