EXECUTION COPY EXHIBIT 10.5 AGREEMENT THIS AGREEMENT ("Agreement") is made as of June 18, 2003, by and between Laidlaw Inc., the Encumbered Subsidiaries and Greyhound Lines, Inc., on the one hand, and the Pension Benefit Guaranty Corporation, on the other hand. RECITALS Each member of the Laidlaw Group is jointly and severally liable for the Pension Plans; and Laidlaw Inc. and certain other members of the Laidlaw Group are debtors in the Bankruptcy Proceedings; and The Debtors intend to reorganize under Chapter 11 of the Bankruptcy Code and to continue the Pension Plans; and As a consequence of the Laidlaw Bankruptcy Reorganization, certain of the Debtors' unsecured debt that would be subordinate to the obligations of the Debtors to the PBGC if the Pension Plans were terminated by the PBGC prior to the consummation of the Reorganization Plan will be replaced by secured debt that likely would be senior to the obligations of the Debtors to the PBGC if the Pension Plans were terminated by the PBGC after the consummation of the Reorganization Plan; and Each of the Pension Plans is covered by the pension plan termination insurance program set forth in Title IV of the Employee Retirement Income Security Act of 1974 ("ERISA"), ERISA sections 4001-4402; and PBGC has expressed certain concerns about the Laidlaw Bankruptcy Reorganization; and To address the PBGC's concerns, the Laidlaw Group and PBGC ("Term Sheet Signatories") entered into a preliminary written agreement dated January 22, 2003 ("Term Sheet"); and The Parties desire to enter into this Agreement, which shall constitute the definitive documentation contemplated under the Term Sheet; and -1- THEREFORE, as provided for by the Term Sheet and for good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties agree as follows: I. DEFINITIONS As used in this Agreement, the following terms shall have the meaning set forth below: "ATU Plan" means the Greyhound, Inc. Amalgamated Transit Union Local 1700 Council Retirement & Disability Plan. "Agreement" shall mean this agreement and all of its exhibits, addenda and other attachments, by and among PBGC and the members of the Laidlaw Group. "Bankruptcy Code" means the Bankruptcy Code of 1978, as amended, 11 U.S.C.Sections 101, et. seq., and any successor statute of similar import, together with the regulations thereunder, in each case as in effect from time to time. References to sections of the Bankruptcy Code shall be construed to refer also to any successor sections of similar import. "Bankruptcy Proceedings" means the jointly administered bankruptcy proceedings styled In re Laidlaw USA, Inc., et al., Case Nos. 01-14099 K through 01-14104 K, pending in the United States Bankruptcy Court for the Western District of New York. "CFC" means an entity that is a controlled foreign corporation under section 957 of the Internal Revenue Code. "Contributing Sponsor" shall have the meaning set forth in ERISA section 4001(a)(13). "Controlled Group" shall have the meaning ascribed thereto under ERISA section 4001(a)(14). "Debtors" means Laidlaw Inc., Laidlaw USA, Inc., Laidlaw Investments Ltd., Laidlaw International Finance Corporation, Laidlaw Transportation, Inc., and Laidlaw One, Inc. "Effective Date" shall mean the effective date of Laidlaw's Reorganization Plan. "Encumbered Subsidiaries" means all of Laidlaw's affiliates that are signatories to the Exit Financing Facility; provided, however, that in no circumstance will the term Encumbered Subsidiaries -2- include a CFC or insurance company. A list of the Encumbered Subsidiaries is attached to this Agreement as Exhibit B. "Enhanced Contributions" shall mean the cash contributions that each member of the Laidlaw Group is jointly and severally obligated to pay to the Pension Plans pursuant to sections II.A.1.(a), II.A.1.(b), and II.A.1.(c) of this Agreement. "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended, ERISA section 2 et seq., and any successor statute of similar import, together with the regulations thereunder, in each case as in effect from time to time. References to sections of ERISA shall be construed to refer to any successor sections. "Event of Default" means the event described in section VII of this Agreement. "Exit Financing Facility" means the credit facility consisting of: (a) a senior secured revolving credit facility in the amount of not less than $200,000,000.00, including a $50,000,000.00 letter of credit sub-facility; and (b) a senior secured seven year term loan facility in the principal amount of up to $625,000,000.00 (plus, at the request of the Debtors and at the discretion of the lenders, an additional term loan of up to $100,000,000.00), including a cash-collateralized $100,000,000.00 letter of credit facility that will be entered into by the Debtors, the Exit Financing Facility Agent Bank and the other lenders party thereto on the Effective Date, on substantially the same terms and conditions described on Exhibit VI to the Reorganization Plan, as such credit facility may be amended, waived, amended and restated, refinanced, replaced, or otherwise modified from time to time, provided, however, that no such amendment, waiver, restatement, refinancing, replacement or other modification shall increase the size of the Exit Financing Facility to an amount greater than the size of the Exit Financing Facility existing on the Effective Date (including the additional discretionary term loan amount described in clause (b) of this sentence). "Funding Interest Rate" means the interest rate used by the Plans' enrolled actuaries for purposes of Internal Revenue Code section 412(b)(5)(A). -3- "Funding Standard Account" means the funding standard account maintained for the Plans pursuant to the Internal Revenue Code section 412. "Initial Credit Balance" shall mean, with respect to each Pension Plan, the credit balance in the Plan's funding standard account for the Plan Year ending December 31, 2002, as determined by the Plan's enrolled actuary. The Initial Credit Balance must reflect the Plan's share of the $50,000,000 Enhanced Contribution discussed in section II.A.1.(a) below. "Intercreditor Agreements" shall have the meaning set forth in section II.E. of this Agreement. "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended, 26 U.S.C.Section 1, et. seq., and any successor statute of similar import, together with regulations thereunder, in each case as in effect from time to time. References to sections of the Internal Revenue Code shall be construed to refer also to any successor or substantially related sections of similar import. "Laidlaw" shall mean Laidlaw Inc. prior to the Effective Date and New LINC (as defined in the Reorganization Plan) after the Effective Date; provided, however, that in no circumstance will the term Laidlaw include a CFC, an insurance company, a direct or indirect subsidiary of Greyhound Lines, Inc. or Interstate Leasing, Inc., Hotard Coaches, Inc. or any of their respective direct or indirect subsidiaries. "Laidlaw Bankruptcy Reorganization" means the confirmation of the Reorganization Plan as provided in section 1141 of the Bankruptcy Code. "Laidlaw Group" shall mean each member of the Controlled Group of which Laidlaw is a member as of the date the Bankruptcy Case was filed. The Laidlaw Group includes, but is not limited to, Laidlaw, Greyhound Lines, Inc. and each of the Encumbered Subsidiaries; provided, however, that in no circumstance will the term Laidlaw Group include a CFC, an insurance company, a direct or indirect subsidiary of Greyhound Lines, Inc. or Interstate Leasing, Inc., Hotard Coaches, Inc. or any of their respective direct or indirect subsidiaries. "Maximum Tax Deductible Contribution Amount" shall mean, with respect to a Plan Year, the maximum amount of contributions to the Plan for such Plan Year that would be tax deductible pursuant to Internal Revenue Code section 404, determined as if the applicable interest rate is the lowest interest rate -4- in the "permissible range" prescribed by Internal Revenue Code section 412(b)(5)(B)(ii), as modified by Internal Revenue Code section 412(l)(7)(C), or any successor provisions thereto to determine "current liability" as defined under Internal Revenue Code section 412. "Minimum Funding Contribution" means, as to any of the Plans, the minimum funding requirements under Internal Revenue Code section 412. "PBGC" means the Pension Benefit Guaranty Corporation, the United States government agency that administers and enforces the mandatory termination insurance program for defined benefit pension plans under Title IV of ERISA, 29 U.S.C. Sections 1301-1461. "PBGC Documents" shall mean collectively this Agreement, the Intercreditor Agreements, the Junior Security Agreement in favor of the PBGC made by Laidlaw Investments LTD., an Ontario corporation as predecessor to Laidlaw International, Inc., a Delaware corporation dated as of June 18, 2003, and the Stock Trust. "PBGC Lien" shall have the meaning set forth in section II.E. of this Agreement. "Pension Plans" or "Plans" means the following defined benefit pension plans: (1) Greyhound Lines, Inc. Salaried Employees Defined Benefit Plan; (2) ATU Plan; (3) Texas New Mexico and Oklahoma Coaches, Inc. Employees Retirement Plan; (4) Vermont Transit Co. Inc. Employees Defined Benefit Pension Plan; (5) Carolina Coach Company Pension Plan; (6) Carolina Coach Co. International Association of Machinist Pension Plan; and (7) Carolina Coach Company Amalgamated Transit Union Pension Plan; plus any successor plan to any thereof under ERISA section 4021 or any plan or plans that result from any merger or spinoff of or from any thereof. "Plan Release Events" means the events described in section IV.B. of this Agreement. "Plan Year" shall mean, with respect to each Plan, the "plan year" as defined in ERISA section 3(39), provided that for purposes hereof, any "Plan Year" shall equal twelve months. -5- "Reorganization Plan" shall mean the Third Amended Joint Plan of Reorganization of Laidlaw USA Inc. and Its Debtor Affiliates (and all exhibits, addenda and other attachments thereto), filed with the Bankruptcy Court on January 23, 2003, as may be further amended. "Required Credit Balance" means, with respect to each Plan, the amount in each Plan's Funding Standard Account determined in accordance with section II.C. of this Agreement. "Standard Termination" shall have the meaning ascribed thereto under ERISA section 4041(b). "Stock Trust" or "Trust" means the trust established pursuant to documents in substantially the form attached as Exhibit A of this Agreement for purposes of funding all or part of the Enhanced Contributions required pursuant to section II.A.1.(c) of the Agreement. "Term" means the period commencing on the latest date on which this Agreement has been signed by all the Parties and ending on the date this Agreement terminates pursuant to section IV of this Agreement. "Termination Events" means the events described in section IV.A. of this Agreement. "Trustee" means the trustee of the Stock Trust designated in accordance with section II.B.1. of this Agreement. "Unfunded Benefit Liabilities" shall mean the amount of a Pension Plan's unfunded benefit liabilities (as defined in ERISA section 4001(a)(18)). II. LAIDLAW OBLIGATIONS A. Payment, Allocation and Effect of Enhanced Contributions. 1. Payment of Enhanced Contributions. Effective upon the consummation of its Reorganization Plan under Title 11 of the United States Code, Laidlaw and the Laidlaw Group shall be jointly and severally obligated to make Enhanced Contributions, as described in sections II.A.1.(a), II.A.1.(b), and II.A.1.(c) below, to the Pension Plans, plus additional contributions necessary to maintain the Initial Credit Balance and Required Credit Balance in each of the Plans' funding standard accounts. (a) The Laidlaw Group shall pay in cash to the Plans upon the Effective Date Enhanced Contributions in the aggregate amount of $50,000,000, allocated to the -6- 2002 Plan Years for funding standard account purposes. These payments will be in addition to any minimum funding contributions owed to the Plans for the 2002 Plan Years; (b) Not later than June 30, 2004, the Laidlaw Group shall pay in cash to the Plans Enhanced Contributions in the aggregate amount of $50,000,000, allocated to the 2003 Plan Years for funding standard account purposes. These payments will be in addition to any minimum funding contributions owed to the Plans for the 2003 Plan Years. (c) Not later than December 31, 2004, the Laidlaw Group shall pay in cash to the Plans Enhanced Contributions in the aggregate amount of no less than $50,000,000, allocated to the Plan Years in which the payments are actually made (or to the prior Plan Years, if made within eight and one-half (8 1/2) months of the end of any such prior Plan Year) for funding standard account purposes. These payments will be in addition to any minimum funding contributions owed to the Plans for the corresponding Plan Years. 2. Allocation of Enhanced Contributions Among Pension Plans. The Enhanced Contributions will be allocated among the Pension Plans in proportion to the Plans' Unfunded Current Liabilities as determined by the Plans' actuaries in accordance with Internal Revenue Code section 404(a)(1)(D)(i). To the extent that the proceeds from any sale of the common stock of Laidlaw by the Stock Trust are allocated among the Pension Plans in proportions different than the proportions described in this Section II.A.2., the Laidlaw Group shall be obligated to make, on or before December 31, 2004, additional Enhanced Contributions (which shall be treated as contributions made pursuant to Section II.A.1.(c)) to any Pension Plan that received, in respect of such proceeds, less than the amount of such proceeds that would have been allocated to such Pension Plan had such proceeds been allocated in the proportions described in this Section II.A.2. (the amount of such shortfall being referred to herein as a "Stock Sale Proceeds Shortfall") in an amount equal to the sum of (i) the Stock Sale Proceeds Shortfall plus (ii) interest on the Stock Sale Proceeds Shortfall calculated at the Plan's Funding Interest Rate for the period from the date of the allocation of Laidlaw common stock sale proceeds that resulted in the Stock Sale Proceeds Shortfall to the date of the contribution described in this sentence. 3. Effect of Enhanced Contributions on Required Funding. The Enhanced Contributions can be used to calculate minimum funding pursuant to the Retirement Protection Act of 1994 (including the special provisions of the Retirement Protection Act of 1994 that apply only to the ATU Plan), but otherwise may not be used to offset the quarterly contributions under Internal Revenue Code section 412(m) and ERISA section 302(e); provided however, that any contributions pursuant to section II.A.1.(c) above in excess of $50,000,000 may be used to offset such quarterly contributions. B. Stock Trust 1. The Laidlaw Group shall take all actions necessary to establish the Stock Trust. Pursuant to an exemption from the registration requirements of the Securities Act of 1933, the Laidlaw Group shall issue to the Stock Trust common stock of Laidlaw with an aggregate value of no less than $50,000,000, as determined by the value of Laidlaw's common stock upon emergence from bankruptcy set forth in Laidlaw's Disclosure Statement Pursuant to Section 1125 of the Bankruptcy Code dated January 23, 2003. The Trust shall own the common stock. The Trustee of the Stock Trust will be independent of the Laidlaw Group and the Plans, and the Laidlaw Group shall pay all of the Stock Trust's fees and expenses, including those of its Trustee. PBGC for the benefit of the Pension Plans shall have -7- the exclusive and first priority lien on all of the assets in the Stock Trust, including the common stock and any proceeds from the sale(s) of the common stock prior to the transfer of such proceeds to the Plans. 2. Laidlaw shall make the stock held in the Stock Trust freely transferable by the Trustee as soon as reasonably practicable. The common stock in the Stock Trust may be sold in one or more transactions for no less than the current fair market value at the time of the sale. Subject to compliance with applicable federal and state securities laws, the Trustee will have the duty to sell the stock held in the Stock Trust as soon as practicable and in a manner designed to maximize sale proceeds, but no later than December 31, 2004. Immediately upon such sale(s) the Trustee shall contribute all of the proceeds to the Plans pursuant to the Trust Agreement. To the extent such proceeds are allocated among the Pension Plans in the proportions described in section II.A.2., such proceeds shall be treated as a cash payment to the Pension Plans under section II.A.1.(c). Laidlaw's consent will be required for any Trustee-initiated sales of stock, and, subject to compliance with applicable federal and state securities laws, Laidlaw will have the right to direct the Trustee to sell the stock. C. Maintenance of the Initial Credit Balance and the Required Credit Balance. The Laidlaw Group shall maintain the Initial Credit Balance and the Required Credit Balance for each Pension Plan throughout the term of this Agreement as follows: 1. The Initial Credit Balance with respect to each Pension Plan shall be the sum of (a), (b) and (c) below, where (a) is the credit balance in the Plan's Funding Standard Account for the Plan Year ending December 31, 2002, as determined by the Plan's enrolled actuary; and (b) is the Plan's share of the $50,000,000 Enhanced Contribution discussed in section II.A.1.(a) of this Agreement; and (c) is the amount, if any, of such Plan's share of the Enhanced Contributions made to the Plan attributable to 2002 from the Laidlaw Group's performance of its obligations described in section II.A.1.(c) of this Agreement, plus the amount of interest calculated at the Plan's Funding Interest Rate. 2. The Laidlaw Group shall make such additional contributions to the Pension Plans that are necessary to insure that each Pension Plan's Required Credit Balance is preserved as of the end of each Plan Year. (a) For each Pension Plan's Plan Year ending December 31, 2003, the "Required Credit Balance" shall be equal to the sum of (i), (ii) and (iii) below, where (i) is such Plan's Initial Credit Balance, plus the amount of interest calculated at the Plan's Funding Interest Rate; and (ii) is the amount, if any, of such Plan's share of the Enhanced Contributions made to the Plan during or attributable to the 2003 Plan Year from the Laidlaw Group's performance of its obligations described in section II.A.1.(c) of this Agreement, plus the amount of interest calculated at the Plan's Funding Interest Rate. If Enhanced Contributions under section II.A.1.(c) of this -8- Agreement made during or attributable to the 2002 and 2003 Plan Years are greater than $50,000,000, the excess over $50,000,000 is not reflected in the 2003 Required Credit Balance. (iii) is such Plan's share of the $50,000,000 Enhanced Contribution, discussed in section II.A.1.(b) of this Agreement, plus the amount of interest calculated at the Plan's Funding Interest Rate; and (b) For each Plan's Plan year ending December 31, 2004, the Required Credit Balance shall be equal to the sum of (i) and (ii) below, where (i) is such Plan's Required Credit Balance for the 2003 Plan year, plus the amount of interest calculated at the Plan's Funding Interest Rate; and (ii) is the amount, if any, of such Plan's share of the Enhanced Contributions made to the Plan during or attributable to the 2004 Plan Year from the Laidlaw Group's performance of its obligations described in section II.A.1.(c) of this Agreement, plus the amount of interest calculated at the Plan's Funding Interest Rate. If Enhanced Contributions made during or attributable to the 2002, 2003 and 2004 Plan Years under section II.A.1.(c) of this Agreement are greater than $50,000,000 in total, the excess over $50,000,000 is not reflected in the 2004 Required Credit Balance. (c) For each Plan Year ending December 31, 2005, and thereafter for so long as the Agreement is in effect, each Pension Plan's Required Credit Balance shall equal the Plan's Required Credit Balance for the previous year plus the amount of interest calculated at the Plan's Funding Interest Rate. 3. Except as provided otherwise in Section II.C., any contributions necessary to meet the Required Credit Balance for a Plan Year shall be made no later than January 15th following the end of the Plan Year (provided, however, that nothing in this Agreement shall require or otherwise accelerate the timing of the payment of the regular minimum funding contribution which is due no later than September 15th of the following Plan Year). 4. Each Plan's Required Credit Balance shall reflect the full Enhanced Contributions required by this Section II., regardless as to whether they are actually paid to the Plan. D. Contributions in Excess of the Maximum Tax Deductible Contribution Amount. 1. Notwithstanding anything in this Agreement, contributions to a Plan for any given Plan year will not be required to exceed that Plan's Maximum Tax Deductible Contribution Amount. If any portion of an Enhanced Contribution is not deductible for a Plan, then that portion shall be contributed to another Plan for which it is deductible. If any portion of an Enhanced Contribution is not deductible for any Plan for a Plan Year, then that portion shall not be required to be contributed for the Plan Year for which it is not deductible, and instead such portion shall be carried over and paid in the next taxable year in which it is -9- deductible. Any such carryover payment will be in addition to any other Enhanced Contributions required for such next year. 2. Each Plan's Required Credit Balance shall reflect the full Enhanced Contributions required by this Section II., regardless as to whether the actual contributions have been limited pursuant to the Maximum Tax Deductible Contribution Amount. E. Grant of Security Interest. To secure their contribution obligations under sections II.A.1.(a), II.A.1.(b), and II.A.1.(c), Laidlaw, and the Encumbered Subsidiaries shall grant to PBGC on behalf of the Pension Plans a second priority lien ("PBGC Lien") on all their property and interests, real and personal, tangible and intangible, whether now owned or hereafter acquired, that secure the Exit Financing Facility, including, without limitation, all such owned real estate, leaseholds, general intangibles, inventory, furniture, fixtures, equipment, intellectual property, contracts, books and records, accounts, shares of stock in subsidiaries and cash, subject only to the liens granted to secure the Exit Financing Facility and other exceptions to be agreed upon; provided, however, that in no event shall the PBGC Lien extend to the property or interests of any CFC or insurance company, and, with respect to equity interests in a CFC, the PBGC Lien shall extend only with respect to 66% of the equity interests in such CFC (consistent with, but subordinate to, the lien on such equity interests granted to secure the Exit Financing Facility). Any subordination of the PBGC Lien to the liens granted to secure the Exit Financing Facility, and any conditions or restrictions on the PBGC's remedies with respect to such liens, shall be subject to Intercreditor Agreements in form and substance satisfactory to the lenders under the Exit Financing Facility (the "Intercreditor Agreements"). III. PBGC'S OBLIGATIONS In consideration of the Laidlaw Group's performance of its obligations under this Agreement, PBGC will (A) forbear from instituting proceedings to involuntarily terminate the Pension Plans pursuant to Title IV of the Employee Retirement Income Security Act of 1974 ("ERISA") in advance of the consummation of Laidlaw's Reorganization Plan, (B) forbear from objecting to Laidlaw's Reorganization Plan, and (C) withdraw all of the claims filed by the PBGC with respect to the Plans in Laidlaw's Chapter 11 case upon consummation of its Reorganization Plan. IV. TERMINATION EVENTS AND PLAN RELEASE EVENTS A. Termination Events. The events described in the following subsections IV.A.1. and IV.A.2. shall be the Termination Events. 1. The date after March 1, 2008, on which Laidlaw obtains the credit ratings (which may be private ratings in the event a public rating is not available) specified below, or better, on either actual unsecured debt or hypothetical unsecured debt in the amount of at least $25 million: -10- Rating Agency Rating - ------------- ------ Standard & Poor's BBB Moody's Baa2. 2. The date after which a Plan Release Event has occurred for each Pension Plan. B. Plan Release Events. The events described in the following subsections IV.B.1. and IV.B.2. shall be the Plan Release Events. 1. The date after December 31, 2007, on which the Laidlaw Group demonstrates that the Plan has no Unfunded Benefit Liabilities as of the last day of the Plan Year for any two full consecutive Plan years after December 31, 2005. 2. The date on which PBGC receives a Form 501 - Post Distribution Certification for the Plan indicating that the Plan has been terminated in a Standard Termination. C. Laidlaw shall notify the PBGC in writing upon the occurrence of a Termination Event or a Plan Release Event. Within fifteen (15) days of PBGC's receipt of such notification, PBGC shall, if a Termination Event or Plan Release Event has occurred, respond in writing concurring that a Termination Event or a Plan Release Event has occurred. If PBGC fails to so respond within such time period, PBGC shall be deemed to have concurred. D. Release of Plan from the Agreement. Laidlaw's obligations under the Agreement with regard to a particular Pension Plan shall terminate on the date on which the PBGC concurs or is deemed to concur that a Plan Release Event described in section IV.B. has occurred for such Plan; provided, however, that the occurrence of a Plan Release Event for any Plan shall have no effect on the Laidlaw Group's obligations under the Agreement for other Pension Plans. E. Termination of Agreement. This Agreement shall terminate on the date on which the PBGC concurs, or is deemed to concur that either Termination Event described in section IV.A. has occurred. F. Effect of Termination. All obligations of the Laidlaw Group and PBGC under this Agreement shall terminate immediately upon termination of this Agreement. -11- V. REPORTING OBLIGATIONS Laidlaw will provide the following information to PBGC, in addition to any reporting obligations that the Laidlaw Group may have under ERISA or the Internal Revenue Code: A. Copies to PBGC's Corporate Finance and Negotiations Department of any notices otherwise required to be filed with the Internal Revenue Service or PBGC concerning the Plans at the time the filing is made; B. Written notice 30 days prior to any Plan merger or any transfer of liabilities or assets described in the Internal Revenue Code, under Internal Revenue Code section 414(l), to or from any Plan (other than de minimis mergers or transfers). C. Written notice 30 days prior to any change in any of the Plans' actuarial assumptions or methods for the purpose of the minimum funding standard account (other than changes required by law), which changes shall be subject to PBGC's consent, which consent shall not be unreasonably withheld. D. Written notice 30 days prior to any change in any of the Plans' Plan Years. Such changes shall be subject to PBGC's consent, which consent shall not be unreasonably withheld. E. Each Plan's Actuarial Valuation Report no later than the last day of the Plan Year. F. Each Plan's Form 5500 when filed. G. By the last day of each Plan Year, a statement certified by one or more of the Plans' enrolled actuaries, specifying the following: 1. The allocation among the Plans of any Enhanced Contributions required for the Plan Year, showing the calculation of each Plan's unfunded current liability in accordance with Internal Revenue Code section 404(a)(1)(D)(i); 2. The amount of contributions necessary to maintain each Plan's Required Credit Balance and details of the calculation of each Plan's Required Credit Balance; and 3. A statement that the contribution necessary to maintain each Plan's Required Credit Balance is not limited by the Maximum Tax Deductible Contribution Amount for the Plan Year, or, if the contribution is so limited, the statement shall contain details showing the calculation of the limitation and the reallocation to other Plans or to later Plan Years. H. By the last day of each Plan Year, a certification from Laidlaw that contributions at least equal to the lesser of V.H.1. or V.H.2. below have been made to each Plan. 1. The amount necessary to maintain each Plan's Required Credit Balance. 2. The maximum tax deductible amount that may be contributed to each Plan for the Plan Year. -12- I. A copy of Plan amendments within 10 days of adoption. J. Written notice within 5 days of any missed quarterly contribution, Minimum Funding Contribution, Enhanced Contribution, or any other contribution required to be made to a Plan pursuant to this Agreement. K. A written statement indicating the number of shares contributed to the Stock Trust pursuant to section II.B. above and the price per share as set forth in the Disclosure Statement filed with respect to the Reorganization Plan. L. Written confirmation as of the end of 2003 and again as of the end of 2004, accounting for all sales of stock, including the number of shares sold and net proceeds, and amounts contributed to the Plans pursuant to sections II.A.1.(c) and II.B. above. M. Written confirmation that the $50,000,000 Enhanced Contribution pursuant to section II.A.1.(a) above was in fact contributed. N. Written confirmation that the $50,000,000 Enhanced Contribution pursuant to section II.A.1.(b) above was in fact contributed. O. For so long as Laidlaw is not a company subject to the periodic reporting requirements under the federal securities laws, copies of all information provided to Laidlaw's shareholders. VI. COORDINATING ACTUARY Laidlaw may appoint a single enrolled actuary to coordinate the actions required of the Plans' enrolled actuaries in order for the Laidlaw Group to discharge its obligations under this Agreement. The coordinating actuary may establish such reasonable procedures as it deems appropriate to obtain information from the enrolled actuaries for the Plans, and shall be entitled to rely on the information it obtains from the Plans' enrolled actuaries. The coordinating actuary may prepare and submit the statement described in section V.G. The coordinating actuary may establish procedures for basing the contribution and allocation of Enhanced Contributions to and among the Plans on the Plans' enrolled actuaries' estimates of the unfunded current liabilities of the Plans on the first day of the Plan Year using data available at the time of the contribution or allocation. -13- VII. DEFAULT An Event of Default shall occur under this Agreement if the Laidlaw Group breaches or is in default of any of its obligations under this Agreement, including but not limited to the Laidlaw Group's obligations to make Enhanced Contributions and to maintain the Initial Credit Balance and the Required Credit Balance. VIII. REMEDIES Upon the occurrence of an Event of Default: A. All Enhanced Contributions not already made by the Laidlaw Group to the Pension Plans shall be immediately due and payable to PBGC for the benefit of the Plans. B. In addition to PBGC's rights under the Agreement and authority under Title IV of ERISA, PBGC may, in its sole discretion, demand payment and commence enforcement proceedings that are not inconsistent with the applicable terms of the Intercreditor Agreement. C. PBGC will provide the Laidlaw Group with a reasonable opportunity to cure any default. IX. REPRESENTATIONS AND WARRANTIES A. PBGC represents and warrants to Laidlaw and the Laidlaw Group, as of the date of this Agreement, as follows: (1) Authorizations. PBGC possesses full corporate power and authority to execute, deliver and perform this Agreement. The officers of PBGC executing this Agreement have been duly authorized to execute and deliver this Agreement. (2) Binding Effect. This Agreement has been duly executed and delivered by PBGC and constitutes a legal, valid and binding obligation of PBGC and is enforceable against it in accordance with its terms. (3) Reliance. PBGC recognizes and acknowledges that Laidlaw and the Laidlaw Group have relied on the representations and warranties contained in this section IX.A in entering into this Agreement and that these representations and warranties shall survive the execution and delivery of this Agreement. B. Laidlaw and each member of the Laidlaw Group represent and warrant to PBGC, as of the date of this Agreement as follows: (1) Authorization. Laidlaw is a corporation duly organized, existing and in good standing under the laws of Canada. Laidlaw and each member of the Laidlaw -14- Group possesses full corporate power and authority to execute, deliver and perform this Agreement. Any person or entity executing this Agreement on behalf of Laidlaw and each member of the Laidlaw Group has been duly authorized to do so. (2) Binding Effect. This Agreement has been duly executed and delivered by Laidlaw and each member of the Laidlaw Group and constitutes a legal, valid and binding obligation of Laidlaw and each member of the Laidlaw Group and is enforceable against Laidlaw and each member of the Laidlaw Group in accordance with its terms, subject to the effects of applicable bankruptcy, insolvency, fraudulent conveyance, moratorium and other similar laws relating to or affecting creditors' rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing. (3) No Conflict. The execution, delivery and performance of this Agreement by Laidlaw and each member of the Laidlaw Group is not in contravention of, and does not constitute a default under, the terms of any of Laidlaw's or any member of the Laidlaw Group's respective articles of incorporation, by-laws or other organizational documentation, or any law, regulation, decree, order, judgment, indenture, agreement or undertaking to which Laidlaw or any member of the Laidlaw Group is a party or by which Laidlaw or any member of the Laidlaw Group or any of its properties are bound or result in the creation of imposition of any lien on any of the respective properties of Laidlaw or any member of the Laidlaw Group. (4) No Consents Required. No consent, approval, authorization, filing, registration or other similar formality of or with any governmental authority, agency or instrumentality, or any other person or entity is required in connection with the execution, delivery or performance by Laidlaw or any member of the Laidlaw Group of this Agreement, except for approval of this Agreement by the Bankrtupcy Court and except as may be required under (a) state securities or "blue sky" laws or (b) the Securities Act of 1933, the Securities Exchange Act of 1934 or the Trust Indenture Act of 1939. (5) Reliance. Laidlaw and each member of the Laidlaw Group recognizes and acknowledges that the PBGC has relied on the representations and warranties contained in this section IX.B. in entering into this Agreement and that these representations and warranties shall survive the execution and delivery of this Agreement. X. GENERAL PROVISIONS A. Governing Law. This Agreement and the rights and obligations of the parties hereunder shall be governed by and construed in accordance with the laws of the State of Delaware and by ERISA, the Internal Revenue Code, and other laws of the United States to the extent they preempt the laws of the State of Delaware. -15- B. Entire Agreement. This Agreement and any instruments or documents delivered or to be delivered in connection herewith represent the entire agreement and understanding concerning the subject matter between the parties hereto, and supersedes the Term Sheet and all other prior agreements, understandings, negotiations, discussions, proposals and offers concerning the subject matter hereof, whether oral or written. C. Severability. If any provision of this Agreement shall be rendered invalid, inoperative, or unenforceable as applied in any particular case, such action shall not have the effect of rendering the provision in question inoperative or unenforceable in any other case or circumstance. If any provision of this Agreement shall be rendered invalid, inoperative, or unenforceable in all cases, such action shall not have the effect of rendering any other provisions of the Agreement invalid, inoperative, or unenforceable. The invalidity of any portion of this Agreement shall not affect the remaining portions of the Agreement. D. Limitation of Rights. This Agreement is intended to be and is for the sole and exclusive benefit of the Laidlaw Group, the PBGC, and their assigns under X.E.. Nothing expressed or mentioned in or to be implied from the Agreement gives any person other than the Laidlaw Group and PBGC any legal or equitable right, remedy, or claim against the Laidlaw Group or PBGC under or in respect of this Agreement. E. Assignment. This Agreement may not be assigned in whole or in part by either party without the express written consent of the other party. F. Notices. All notices, requests, or other communications shall be in writing and shall be deemed to have been given (1) if by courier, when receipted for, (2) if by certified mail, return receipt requested, when the return receipt has been received, or (3) if by telex, facsimile or similar electronic transfer, when sent, with receipt confirmed, address as follows: Laidlaw: Mr. Kevin Benson Chief Executive Officer Laidlaw Inc. 55 Shuman Boulevard Suite 400 -16- Naperville, Illinois, 60563 With copy to: Daniel C. Hagen, Esq. Jones Day 901 Lakeside Avenue Cleveland, OH 44114 PBGC: Director, Corporate Finance and Negotiations Department Pension Benefit Guaranty Corporation 1200 K Street, NW, Suite 270 Washington, DC 20005-4026 Facsimile: (202) 842-2643 With copy to: General Counsel Pension Benefit Guaranty Corporation 1200 K Street, NW, Suite 340 Washington, DC 20005-4026 Facsimile: (202) 326-4112 G. Business Days. If the last date for performing any act or exercising any right provided for in the Agreement falls on a Saturday, Sunday or federal holiday, unless otherwise expressly provided in the Agreement, the act may be performed or the right exercised on the next day that is not a Saturday, Sunday, or federal holiday with the same force and effect as if done on the date provided in the Agreement. H. Captions and Headings. The titles and captions used in the section headings of this Agreement are solely for the convenience of the parties and shall not be controlling for purposes of the interpretation of this Agreement. I. Counterparts. This Agreement may be executed in identical counterparts, each of which shall be an original as against the party that signed it, and all which together shall constitute one and the same instrument. This Agreement will be effective as of the latest date on which it has been signed by all the parties. The term of this Agreement ("Term") shall be from the date indicated in the preceding sentence until the date indicated in section IV of this Agreement; provided, however, that if the Reorganization Plan is not consummated, this Agreement shall be null and void. -17- J. Amendment and Waivers. No amendment of any provision of this Agreement shall be valid unless the amendment is in writing and signed by the parties to this Agreement. The failure of any party to the Agreement to enforce a provision of the Agreement shall not constitute a waiver of the party's right to enforce that provision of the Agreement. K. No Change to Governing Plan Documents or Plan Administration. This Agreement is not a document or instrument governing the Pension Plans, nor does anything in this Agreement amend, supplement, or derogate from the documents and instruments governing the Pension Plans. Further, nothing in this Agreement alters, amends, or otherwise modifies the operation or administration of the Pension Plans. L. Reservation of Rights. Nothing in this Agreement shall preclude the PBGC from exercising its regulatory, enforcement, litigation, or other authority as set forth in ERISA and the Internal Revenue Code with respect to any person, other than as expressly provided otherwise in this Agreement. M. Rules for Interpretation. For purposes of this Agreement, unless otherwise provided herein: (1) whenever from the context it is appropriate, each term, whether stated in the singular or the plural, will include both the singular and the plural; (2) unless otherwise provided in this Agreement, any reference in this Agreement to another agreement, contract, instrument or document being in a particular form or having particular terms and conditions means that such agreement, contract, instrument, or document will be substantially in such form or substantially on such terms and conditions; (3) any reference to PBGC, Laidlaw, the Laidlaw Group, and the Encumbered Affiliates includes such entities successors, assigns and affiliates, provided, however, that any of the aforementioned references will under no circumstances include a CFC or an insurance company; and (4) The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent, and no rule of strict construction shall be applied against any party hereto. Nor shall any rule of construction that favors a non-draftsman or a government agency be applied. A reference to any statute shall be deemed also to refer to all rules and regulations promulgated under the statute, unless the context requires otherwise. -18- IN WITNESS WHEREOF, this Agreement has been duly executed and delivered as of the day and year first set forth above. PENSION BENEFIT GUARANTY CORPORATION By: /s/ Robert M. Klein -------------------------- Name: Robert M. Klein Title: Deputy Director, Corporate Finance & Negotiations Dept. Date: 6/18/03 LAIDLAW INC. By: /s/ Ivan R. Cairns -------------------------- Name: Ivan R. Cairns Title: Senior Vice President & General Counsel Date: 6/18/03 GREYHOUND LINES, INC. By: /s/ Ivan R. Cairns -------------------------- Name: Ivan R. Cairns Title: Vice President Date: 6/18/03 ENCUMBERED SUBSIDIARIES LAIDLAW INVESTMENTS LTD., an Ontario corporation (to be domesticated in Delaware as Laidlaw International, Inc.) By: /s/ Ivan R. Cairns -------------------------- Name: Ivan R. Cairns Title: Senior Vice President and Secretary LAIDLAW TRANSPORTATION HOLDINGS, INC., a Delaware corporation -19- LAIDLAW TRANSPORTATION MANAGEMENT INC., an Ohio corporation LAIDLAW MEDICAL HOLDINGS, INC., a Delaware corporation LAIDLAW INTERNATIONAL FINANCE CORPORATION INC., a Delaware corporation LAIDLAW USA, INC., a New York corporation LAIDLAW TRANSPORTATION, INC., a Delaware corporation By: /s/ Ivan R. Cairns ---------------------------------------------- Name: Ivan R. Cairns Title: Senior Vice President and Secretary LAIDLAW ONE INC., a Delaware corporation LAIDLAW TWO, INC., a Delaware corporation S.C. FOOD SERVICES (U.S.A.), INC., a Delaware corporation By: /s/ Ivan R. Cairns ---------------------------------------------- Name: Ivan R. Cairns Title: President and Secretary CONCORDE ADJUSTERS, INC., a Delaware corporation By: /s/ Ivan R. Cairns ---------------------------------------------- Title: Vice President LAIDLAW TRANSIT HOLDINGS, INC., a Delaware corporation -20- LAIDLAW TRANSIT, INC., a Delaware corporation ALLIED BUS SALES, INC., an Indiana corporation LAIDLAW TRANSIT MANAGEMENT COMPANY, INC., a Pennsylvania corporation CHATHAM COACH LINES, INC., a Delaware corporation LAIDLAW TRANSIT SERVICES, INC., a Delaware corporation SUTRAN, INC., a South Dakota corporation VAN TRAN OF TUCSON, INC., an Arizona corporation SAFE RIDE SERVICES, INC., an Arizona corporation By: /s/ Ivan R. Cairns ---------------------------------------------- Name: Ivan R. Cairns Title: Secretary EMCARE GROUP EMCARE HOLDINGS INC., a Delaware corporation EMCARE, INC., a Delaware corporation AMERICAN EMERGENCY PHYSICIANS MANAGEMENT, INC., a California corporation CHARLES T. MITCHELL, INC., a Hawaii corporation COORDINATED HEALTH SERVICES, INC., a Pennsylvania corporation -21- ECEP, INC., a Missouri corporation EMCARE ANESTHESIA SERVICES, INC., a Delaware corporation EMCARE CONTRACT OF ARKANSAS, INC., an Arkansas corporation EMCARE OF ALABAMA, INC., an Alabama corporation EMCARE OF ARIZONA, INC., an Arizona corporation EMCARE OF CALIFORNIA, INC., a California corporation EMCARE OF COLORADO, INC., a Colorado corporation EMCARE OF CONNECTICUT, a Connecticut corporation EMCARE OF FLORIDA, INC., a Florida corporation EMCARE OF GEORGIA, INC., a Georgia corporation EMCARE OF HAWAII, INC., a Hawaii corporation EMCARE OF INDIANA, INC., an Indiana corporation EMCARE OF IOWA, INC., an Iowa corporation EMCARE OF KENTUCKY, INC., a Kentucky corporation EMCARE OF LOUISIANA, INC., a Louisiana corporation EMCARE OF MARYLAND, LLC, a Maryland limited liability company EMCARE OF MICHIGAN, INC., a Michigan corporation -22- EMCARE OF MINNESOTA, INC., a Minnesota corporation EMCARE OF MISSISSIPPI, INC., a Mississippi corporation EMCARE OF MISSOURI, INC., a Missouri corporation EMCARE OF NEVADA, INC., a Nevada corporation EMCARE OF NEW HAMPSHIRE, INC., a New Hampshire corporation EMCARE OF NEW JERSEY, INC., a New Jersey corporation EMCARE OF NEW MEXICO, INC., a New Mexico corporation EMCARE OF NEW YORK, INC., a New York corporation EMCARE OF NORTH CAROLINA, INC., a North Carolina corporation EMCARE OF NORTH DAKOTA, INC., a North Dakota corporation EMCARE OF OHIO, INC., an Ohio corporation EMCARE OF OKLAHOMA, INC., an Oklahoma corporation EMCARE OF OREGON, INC., an Oregon corporation EMCARE OF PENNSYLVANIA, INC., a Pennsylvania corporation EMCARE OF RHODE ISLAND, INC., a Rhode Island corporation EMCARE OF SOUTH CAROLINA, INC., a South Carolina corporation EMCARE OF TENNESSEE, INC., a Tennessee corporation -23- EMCARE OF TEXAS, INC., a Texas corporation EMCARE OF VERMONT, INC., a Vermont corporation EMCARE OF VIRGINIA, INC., a Virginia corporation EMCARE OF WASHINGTON, INC., a Washington corporation EMCARE OF WEST VIRGINIA, INC., a West Virginia corporation EMCARE OF WISCONSIN, INC., a Wisconsin corporation EMCARE PHYSICIAN SERVICES, INC., a Delaware corporation EMCARE PHYSICIAN PROVIDERS, INC., a Missouri corporation EMCARE SERVICES OF ILLINOIS, INC., an Illinois corporation EMCARE SERVICES OF MASSACHUSETTS, INC., a Massachusetts corporation EM-CODE REIMBURSEMENT SOLUTIONS, INC., a Delaware corporation EMERGENCY MEDICINE EDUCATION SYSTEMS, INC., a Texas corporation EMERGENCY SPECIALISTS OF ARKANSAS, INC. II, a Texas corporation FIRST MEDICAL/EMCARE INC., a California corporation HEALTHCARE ADMINISTRATIVE SERVICES, INC., a Delaware corporation HELIX PHYSICIANS MANAGEMENT, INC., a California corporation NORMAN BRUCE JETTON, INC., a California corporation -24- OLD STAT, INC., a Delaware corporation PACIFIC EMERGENCY SPECIALISTS MANAGEMENT, INC., a California corporation PHYSICIAN ACCOUNT MANAGEMENT, INC., a Florida corporation PROVIDER ACCOUNT MANAGEMENT, INC., a Delaware corporation REIMBURSEMENT TECHNOLOGIES, INC., a Pennsylvania corporation STAT PHYSICIANS, INC., a Florida corporation THE GOULD GROUP, INC., a Texas corporation TIFTON MANAGEMENT SERVICES, INC., a Georgia corporation TUCKER EMERGENCY SERVICES, INC., a Georgia corporation By: /s/ Ivan R. Cairns ---------------------------------------------- Name: Ivan R. Cairns Title: Vice President AMERICAN MEDICAL RESPONSE GROUP AMERICAN MEDICAL RESPONSE, INC., a Delaware corporation AMBULANCE ACQUISITION, INC., a Delaware corporation AMR BROCKTON, L.L.C., a Delaware limited liability company MEDLIFE EMERGENCY MEDICAL SERVICE, INC., an Alabama corporation METROPOLITAN AMBULANCE SERVICE, a California corporation -25- HANK'S ACQUISITION CORP., an Alabama corporation AMERICAN MEDICAL RESPONSE OF INLAND EMPIRE, a California corporation FOUNTAIN AMBULANCE SERVICE, INC., an Alabama corporation GOLDEN GATE ASSOCIATES, a California corporation FLORIDA EMERGENCY PARTNERS, INC., a Texas corporation SAN FRANCISCO AMBULANCE SERVICE, INC., a California corporation AMERICAN MEDICAL RESPONSE NORTHWEST, INC., an Oregon corporation SPRINGS AMBULANCE SERVICE, INC., a California corporation AMERICAN MEDICAL RESPONSE OF COLORADO, INC., a Delaware corporation MEDEVAC MIDAMERICA, INC., a Missouri corporation AMERICAN MEDICAL RESPONSE WEST, a California corporation DESERT VALLEY MEDICAL TRANSPORT, INC., a California corporation INTERNATIONAL LIFE SUPPORT, INC., a Hawaii corporation MEDEVAC MEDICAL RESPONSE, INC., a Missouri corporation AMERICAN MEDICAL RESPONSE OF OKLAHOMA, INC., a Delaware corporation AMERICAN MEDICAL RESPONSE OF TEXAS, INC., a Delaware corporation KUTZ AMBULANCE SERVICE, INC., a Wisconsin corporation -26- AMERICAN MEDICAL RESPONSE HOLDINGS, INC., a Delaware corporation AMERICAN MEDICAL RESPONSE MANAGEMENT, INC., a Delaware corporation REGIONAL EMERGENCY SERVICES, L.P., a Delaware limited partnership A1 LEASING, INC., a Florida corporation MOBILE MEDIC AMBULANCE SERVICE, INC., a Delaware corporation METRO AMBULANCE SERVICE, INC., a Delaware corporation METRO AMBULANCE SERVICE (RURAL), INC., a Delaware corporation MEDIC ONE AMBULANCE SERVICES, INC., a Delaware corporation AMERICAN MEDICAL RESPONSE OF SOUTH CAROLINA, INC., a Delaware corporation AMERICAN MEDICAL RESPONSE OF NORTH CAROLINA, INC., a Delaware corporation AMERICAN MEDICAL RESPONSE OF GEORGIA, INC., a Delaware corporation RANDLE EASTERN AMBULANCE SERVICE, INC., a Florida corporation MEDI-CAR SYSTEMS, INC., a Florida corporation AMERICAN MEDICAL RESPONSE OF TENNESSEE, INC., a Delaware corporation PHYSICIANS & SURGEONS AMBULANCE SERVICE, INC., an Ohio corporation AMERICAN MEDICAL RESPONSE OF ILLINOIS, INC., a Delaware corporation TROUP COUNTY EMERGENCY MEDICAL SERVICES, INC., a Georgia corporation -27- MEDI-CAR AMBULANCE SERVICE, INC., a Florida corporation MIDWEST AMBULANCE MANAGEMENT COMPANY, a Delaware corporation PARAMED, INC., a Michigan corporation MERCY AMBULANCE OF EVANSVILLE, INC., an Indiana corporation TIDEWATER AMBULANCE SERVICE, INC., a Virginia corporation AMERICAN MEDICAL RESPONSE OF CONNECTICUT, INCORPORATED, a Connecticut corporation ATLANTIC AMBULANCE SERVICES ACQUISITION, INC., a Delaware corporation AMERICAN MEDICAL RESPONSE OF MASSACHUSETTS, INC., a Massachusetts corporation ATLANTIC/KEY WEST AMBULANCE, INC., a Delaware corporation AMERICAN MEDICAL RESPONSE MID-ATLANTIC, INC., a Pennsylvania corporation ATLANTIC/PALM BEACH AMBULANCE, INC., a Delaware corporation AMERICAN MEDICAL RESPONSE DELAWARE VALLEY, LLC, a Delaware limited liability company SEMINOLE COUNTY AMBULANCE, INC., a Delaware corporation METRO AMBULANCE SERVICE, INC., a Georgia corporation LIFEFLEET SOUTHEAST, INC., a Florida corporation BROWARD AMBULANCE, INC., a Delaware corporation AMERICAN MEDICAL PATHWAYS, INC., a Delaware corporation -28- LAIDLAW MEDICAL TRANSPORTATION, INC., a Delaware corporation LIFECARE AMBULANCE SERVICE, INC., an Illinois corporation TEK, INC., an Illinois corporation HEMET VALLEY AMBULANCE SERVICE, INC., a California corporation MEDIC ONE OF COBB, INC., a Georgia corporation GIEGER TRANSFER SERVICE, INC., a Mississippi corporation MERCY LIFE CARE, a California corporation AMERICAN MEDICAL RESPONSE OF SOUTHERN CALIFORNIA, a California corporation PUCKETT AMBULANCE SERVICE, INC., a Georgia corporation MERCY, INC., a Nevada corporation AMERICAN INVESTMENT ENTERPRISES, INC., a Nevada corporation ADAM TRANSPORTATION SERVICE, INC., a New York corporation ASSOCIATED AMBULANCE SERVICE, INC., a New York corporation PARK AMBULANCE SERVICE INC., a New York corporation FIVE COUNTIES AMBULANCE SERVICE, INC., a New York corporation SUNRISE HANDICAP TRANSPORT CORP., a New York corporation By: /s/ Ivan R. Cairns ---------------------------------------------- Name: Ivan R. Cairns Title: Vice President -29- LINC TRANSPORTATION, LLC, a Delaware limited liability company By: /s/ Ivan R. Cairns ---------------------------------------------- Name: Ivan R. Cairns Title: Vice President and Secretary -30- EXHIBIT A LAIDLAW STOCK TRUST AGREEMENT This TRUST AGREEMENT made this 20th day of June, 2003, by and between Laidlaw Investments Ltd., a corporation organized under the laws of the Province of Ontario, Canada, to be domesticated into the United States as a Delaware corporation and thereafter known as Laidlaw International, Inc. (the "Company") and U.S. Trust Company, National Association, as trustee (the "Trustee"). WHEREAS, the Company is a party to the proceedings under Chapter 11 of the U.S. Bankruptcy Code, IN RE: LAIDLAW USA, INC. ET AL., CASE NOS. 01-14099K THROUGH 01-14104K (the "Chapter 11 Proceedings"), in the United States Bankruptcy Court for the Western District of New York; WHEREAS, affiliates of the Company are the sponsors of the following pension plans: 1. Greyhound Lines, Inc. Salaried Employees Defined Benefit Plan; 2. Greyhound Inc. Amalgamated Transit Union Local 1700 Council Retirement & Disability Plan; 3. Texas New Mexico and Oklahoma Coaches, Inc. Employee Retirement Plan; 4. Vermont Transit Co. Inc. Employees Defined Benefit Pension Plan; 5. Carolina Coach Company Pension Plan; 6. Carolina Coach Co. International Association of Machinist Pension Plan; and 7. Carolina Coach Company Amalgamated Transit Union Pension Plan (the "Pension Plans"), all of which are qualified defined benefit plans under Section 401(a) of the Internal Revenue Code (the "Code"); WHEREAS, the Company has entered into a settlement agreement with the Pension Benefit Guaranty Corporation ("PBGC"), dated June 20, 2003, (the "Settlement Agreement") in connection with the Chapter 11 Proceedings and the Pension Plans; and WHEREAS, pursuant to the Settlement Agreement, the Company desires to establish this irrevocable trust (the "Trust") and to transfer to the Trust shares of Common Stock of the Company (the "Company Stock"), which shall be sold by the Trustee pursuant to the terms of the Trust to generate proceeds which shall be transferred to the Pension Plans, in satisfaction of the Company's obligations under the Settlement Agreement; NOW, THEREFORE, the parties do hereby establish the Trust and agree that the Trust shall be comprised, held and disposed of as follows: ARTICLE I ESTABLISHMENT Section 1.1 Trust Fund. The assets held at any time and from time to time under the Trust collectively are herein referred to as the "Trust Fund" and shall consist of contributions received by the Trustee, proceeds of sales, investments and reinvestments thereof, the earnings and income thereon, and less disbursements thereof. Except as herein otherwise provided, title to the assets of the Trust Fund shall at all times be vested in the Trustee and securities that are part of the Trust Fund shall be held in such manner that the Trustee's name and the fiduciary capacity in which the securities are held are fully disclosed, subject to the right of the Trustee to hold title in the name of a nominee, and the interests of others in the Trust Fund shall be only the right to have such assets received, held, invested, administered and distributed in accordance with the provisions of this Agreement. This Trust shall be known as the Laidlaw Stock Trust. The Company and the Trustee intend the Trust to be an independent legal entity. In accordance with the Settlement Agreement, the assets of the Trust Fund are subject to an exclusive and first priority lien in favor of the PBGC. Pursuant to the terms of the Settlement Agreement, such lien shall be extinguished as and to the extent that the entire Trust Fund, including the proceeds of sales of the shares of Company Stock, are transferred to the Pension Plans. Section 1.2 Trustee Acceptance. The Trustee hereby accepts this Trust and all the Company's right, title and interest in the property transferred to the Trust and all other property coming into the possession of the Trustee pursuant to the terms of this Agreement, and the Trustee agrees to hold, administer and distribute the Trust property, the income therefrom, and the proceeds thereof according to the terms and conditions hereof. Section 1.3 Grantor Trust. The Trust has been established for the purpose of reducing the Company's cash funding obligations to the Pension Plans under the Settlement Agreement. The Trust is intended to be a grantor trust within the meaning of Section 671 of the Code and shall be construed accordingly. The Trust is intended not to be subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended. Section 1.4 Irrevocability. The Trust shall not be revocable by the Company. This Agreement may be amended as provided in Section 9.1. ARTICLE II FUNDING OF TRUST Section 2.1 Receipt of Assets. Concurrently with the execution of this Agreement, the Company is conveying to the Trust 3,777,419 shares of Company Stock. The Trustee shall receive and accept for the purposes hereof all such shares of Common Stock, and pursuant to the terms of this Agreement, shall hold, manage, administer and distribute the Trust Fund. The Trustee need not inquire into the source of any money or property transferred to it nor into the authority or right of the transferor of such money or property to transfer such money or property to the Trustee. All right, title and interest in and to the assets of the Trust Fund shall at all times - 2 - be vested exclusively in the Trustee. The Trustee shall have only such duties with respect to the Trust Fund as are set forth in this Agreement. Section 2.2 Rights Regarding Common Stock. With respect to the manner of voting of Company Stock held by the Trust or decisions in connection with any tender or exchange offer for Company Stock held by the Trustee, the Trustee shall vote the Company Stock or respond to such tender or exchange offer in the manner recommended by the Company's Board of Directors. ARTICLE III DISBURSEMENTS FROM TRUST Section 3.1 Disbursements Made To Pension Plans. As soon as practicable after any sale of Company Stock by the Trustee, as provided in Section 3.2, the Trustee shall transfer the net proceeds from such sale to one or more of the Pension Plans as directed by the Company. The Company shall have no right or power to direct the Trustee to return to the Company or to divert to others any of the Trust assets and no asset of the Trust shall revert to the Company under any circumstances. Section 3.2 Sale of Stock. Subject to compliance with applicable federal and state securities laws, the Trustee shall sell the Company Stock held by the Trust as soon as practicable but not later than December 31, 2004 in accordance with the guidelines set forth in this Section 3.2. (a) The Company Stock may be sold in one or more transactions for no less than the current fair market value at the time of any such sale as determined by the Trustee. Any such sale shall be in accordance with applicable state and federal laws and regulations. (b) The Trustee, in its discretion, shall determine the time at which the Company Stock in the Trust shall be sold. Such determination shall be based on maximizing the proceeds from the sale of the Company Stock. (c) Notwithstanding the foregoing, the Trustee must obtain the Company's consent prior to selling the Company Stock. In addition, the Company may, at any time, direct the Trustee to sell the Company Stock in accordance with the terms of this Agreement, and in such case the Trustee shall sell Company Stock in accordance with such direction, without regard to whether the Trustee has determined that the Company Stock should be sold. ARTICLE IV INVESTMENTS Section 4.1 Investments. The Trustee shall invest and reinvest the Trust Fund exclusively in Company Stock; provided, however, that the Trustee may temporarily invest any cash held in the Trust from time to time in (i) United States Government obligations with maturities of less than one year, (ii) interest-bearing accounts including, but not limited to, certificates of deposit, time deposits, savings accounts and money market accounts, with maturities of less than one year, or (iii) a common, collective or pooled trust fund maintained by the Trustee whose investments are limited to those described in clauses (i) and (ii) of this Section 4.1, in which event such part of the Trust Fund so invested shall be subject to all of the terms and provisions of the common, - 3 - collective or pooled trust fund which contemplate the commingling for investment purposes of such trust assets with trust assets of other trusts. Section 4.2 Trustee Duties. Subject to Section 3.2, the Trustee shall have no duty to determine or review the merit or suitability of investing the Trust Fund in Company Stock for the objectives of the Trust. ARTICLE V ACCOUNTING BY TRUSTEE Section 5.1 The Trustee shall keep accurate and detailed records of all investments, receipts, disbursements and other transactions. All such records shall be open to inspection and audit at all reasonable times by the Company or the PBGC. Within sixty days following the close of each Trust Year and within sixty days after the removal or resignation of a Trustee, the Trustee shall deliver to the Company and the PBGC a written account of its administration of the Trust during such year or during the period from the close of the last preceding Trust Year to the date of such removal or resignation, setting forth all investments, receipts, disbursements and other transactions effected by it, including a description of all securities and investments purchased and sold with the cost and net proceeds of such purchases or sales, and showing all cash, securities and other property held in the Trust at the end of such year or as of the date of such removal or resignation, as the case may be. All tax returns and other regulatory filings required by the Trust shall be prepared by the Company. The Trustee shall fully cooperate with the Company in the Company's preparation of the tax returns and regulatory filings by providing all records and information needed to accurately complete such returns and filings and by taking any other actions that might assist the Company in its preparation of the returns and filings. The Trustee shall make such filings as shall be directed by the Company and shall be entitled to rely on the accuracy of all returns and filings so prepared by the Company. ARTICLE VI RESPONSIBILITY AND POWERS OF TRUSTEE Section 6.1 Duty of Trustee. (a) In performing its duties hereunder, the Trustee shall act with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, provided, however, that the Trustee shall incur no liability to any person for any action taken pursuant to a direction, request or approval given by the Company in accordance with the terms of this Agreement. (b) The Trustee shall have without exclusion all powers conferred on Trustees by applicable law, unless expressly provided otherwise herein. (c) The Trustee shall not be liable in connection with the performance of its duties hereunder except for its negligence or bad faith; provided, however, that the Trustee shall incur no liability for any action taken by the Trustee in accordance with the terms of this Agreement or pursuant to a direction, request, or approval given by the Company in accordance with the terms of this Agreement. - 4 - Section 6.2 Indemnification. The Company shall indemnify and save harmless the Trustee, its officers, directors and employees, for and from any loss or expense (including reasonable attorneys' fees) arising (a) from the Trustee's performance of its duties in conformance with the terms of the Agreement, including any liability alleged to have resulted from a violation of law, including, without limitation, the Securities Act of 1933, or the rules and regulations of any authority having jurisdiction over the Company or any of its affairs, (b) out of any matter as to which this Agreement provides that the Trustee is directed, protected, not liable, or not responsible, or (c) from the Trustee's delay or failure to act as a result of the Company's failure or delay in providing consent for such act, to the extent the Company's consent is required by the terms of this Agreement; provided, however, that the foregoing provisions of this Section 6.2 shall not apply to any loss or expense resulting from the Trustee's own negligence, recklessness, bad faith, willful misconduct or breach of fiduciary duty. Section 6.3 Management and Control of Trust Fund. Subject to the terms of this Agreement, the Trustee shall have exclusive authority, discretion and responsibility to manage and control the assets of the Trust Fund. Section 6.4 Powers of Trustee. Without in any way limiting the powers and discretion conferred upon it by the other provisions of this Agreement or by law, but subject to the other provisions of this Agreement, the Trustee is expressly authorized and empowered: (a) To sell, exchange, convey, transfer or otherwise dispose of any property held by it by private contract or at public auction, and no person dealing with the Trustee shall be bound to see to the application of the purchase money or to inquire into the validity, expediency or propriety of any such sale or other disposition. (b) To purchase, receive, or subscribe for any securities or other property and to retain in trust such securities or other property. (c) To vote any stocks, bonds or other securities; to give general or special proxies or powers of attorney with or without power of substitution; to exercise any conversion privileges, subscription rights or other options and to make any payments incidental thereto; to consent to or otherwise participate in corporate reorganizations or other changes affecting corporate securities and to delegate discretionary powers and to pay any assessments or charges in connection therewith; and generally to exercise any of the powers of an owner with respect to stocks, bonds, securities or other property held in the Trust Fund. (d) To make, execute and deliver, as Trustee, any and all deeds, leases, mortgages, conveyances, waivers, releases, or other instruments in writing necessary or desirable for the accomplishment of any of the powers granted herein. (e) To register any investment held in the Trust Fund in its own name or in the name of a nominee and to hold any investment in bearer form, or to combine certificates representing such investments with certificates of the same issue held by the Trustee in other fiduciary capacities, or to deposit or to arrange for the deposit of such securities in a qualified central depositary even though, when so deposited, such securities may be - 5 - merged and held in bulk in the name of the nominee of such depositary with other securities deposited therein by any other person, or to deposit or to arrange for the deposit of any securities issued by the United States Government, or any agency or instrumentality thereof, with a Federal Reserve Bank, but the books and records of the Trustee shall at all times show that all such investments are part of the Trust Fund. (f) To employ suitable agents, depositaries and counsel, domestic or foreign. (g) To compromise or otherwise adjust all claims in favor of or against the Trust. (h) To settle, compromise or submit to arbitration any claims, debts, or damages, due or owing to or from the Trust, to commence or defend suits or legal proceedings and to represent the Trust in all suits or legal proceedings in any court of law or before any other body or tribunal. (i) To do all things that the Trustee reasonably deems necessary to carry out the purposes of this Trust. ARTICLE VII TAXES AND COMPENSATION OF TRUSTEE Section 7.1 Taxes. All real and personal property taxes, income taxes and other taxes of any and all kinds levied or assessed under existing or future laws against the Trust Fund shall be paid from the Trust Fund. The Trustee shall be authorized to sell Trust assets to the extent needed to pay the taxes contemplated in the foregoing sentence. Section 7.2 Trustee Compensation. The Trustee shall be entitled to receive such reasonable compensation for its services as shall be agreed upon in writing by the Company and the Trustee. The compensation and expenses of the Trustee shall be paid directly by the Company. ARTICLE VIII REPLACEMENT OF TRUSTEE Section 8.1 The Trustee acting hereunder may resign at any time by giving sixty days' prior written notice to the Company, which notice or time period may be waived by the Company. The Company may remove the Trustee at any time upon sixty days' prior written notice to the Trustee, which notice or time period may be waived by the Trustee. In case of the resignation or removal of the Trustee, the Company shall appoint a successor trustee. Any successor trustee shall be an independent, institutional trustee and shall have the same powers and duties as those conferred upon the Trustee named in this Trust Agreement. The removal of a Trustee and the appointment of a new trustee shall be by a written instrument delivered to the Trustee. Upon the appointment of a successor trustee and after the final account of the resigning or removed Trustee has been approved or settled, as provided in Article V hereof, the resigning or removed Trustee shall transfer or deliver the Trust Fund to such successor trustee. Any Trustee so resigning or removed shall make no surrender charge with respect thereto. - 6 - ARTICLE IX AMENDMENT OR TERMINATION Section 9.1 Amendment. This Agreement may be amended by agreement between the Trustee and the Company at any time or from time to time and in any manner, except that no such amendment may (i) make the Trust revocable or (ii) conflict with the requirements of the Settlement Agreement. Any such amendment shall be expressed in an instrument executed by the Company and the Trustee and shall become effective as of the date designated in such instrument or, if no such date is designated, upon the date of the execution of such instrument. If the Trustee is unable or unwilling to execute any such amendment, it may resign or be removed as provided in Section 8.1 hereof. Section 9.2 Termination. The Trust shall terminate upon the later of (a) the date on which the Trust no longer holds any assets, or (b) the date as of which the Trustee has wound up the affairs of the Trust. ARTICLE X MISCELLANEOUS Section 10.1 Governing Law. The provisions of this Agreement shall be governed by and construed in accordance with the laws of the State of Delaware. Section 10.2 Severability. If any provisions of this Agreement shall be held by a court of competent jurisdiction to be invalid or unenforceable, the remaining provisions of this Agreement shall continue to be fully effective. Section 10.3 Notices. All notices and other communications provided for in this Agreement shall be deemed validly given only if they are in writing and delivered personally or sent by certified mail, postage prepaid, or by overnight courier, or by telecopier, to the following addresses or such other address as either party provides to the other party at the address set forth below: If to the Company: Mr. Kevin Benson Laidlaw International, Inc. 55 Shuman Boulevard Suite 400 Naperville, Illinois 60563 Facsimile: (630) 848-3150 With copy to: Daniel C. Hagen, Esq. Jones Day 601 Lakeside Avenue Cleveland, Ohio 44114 Facsimile: (216) 579-0212 - 7 - If to the PBGC: Director, Corporate Finance and Negotiations Department Pension Benefit Guaranty Corporation 1200 K Street, NW, Suite 270 Washington, DC 20005-4026 Facsimile: (202) 842-2643 With copy to: General Counsel Pension Benefit Guaranty Corporation 1200 K Street, NW, Suite 340 Washington, DC 20005-4026 Facsimile: (202) 326-4112 If to the Trustee: U.S. Trust Company, National Association 114 W. 47th Street New York, NY 10036 Attention: Mr. Alan L. Miller Section 10.4 Assignment. Neither the Company nor the Trustee may assign this Agreement without the prior written consent of the other, except that the Trustee may, after prior notification to the Company and the PBGC, assign its rights and delegate its duties hereunder to any corporation or entity which directly or indirectly is controlled by, or is under common control with, the Trustee. This Trust Agreement shall be binding upon, and inure to the benefit of, the Company and the Trustee and their respective successors and permitted assigns. Any entity which shall by merger, consolidation, purchase, or otherwise, succeed to substantially all the trust business of the Trustee shall, upon such succession and without any appointment or other action by the Company, be and become successor trustee hereunder, upon notification to the Company and the PBGC. Section 10.5 References. Unless the context clearly indicates to the contrary, a reference to a statute, regulation, document or provision shall be construed as referring to any subsequently enacted, adopted or executed counterpart. Section 10.6 Headings. Headings and subheadings in this Agreement are inserted for convenience of reference only and are not to be considered in the construction of its provisions. Section 10.7 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall constitute an original. [SIGNATURES ON FOLLOWING PAGE] - 8 - IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed on the date set forth below by their duly authorized officers effective as of June 20, 2003. LAIDLAW INVESTMENTS LTD. BY:__________________________ NAME:________________________ TITLE:_______________________ DATE: _______________, 2003 U.S. TRUST COMPANY, NATIONAL ASSOCIATION BY:__________________________ NAME:________________________ TITLE:_______________________ DATE: _______________, 2003 - 9 - EXHIBIT B ENCUMBERED SUBSIDIARIES 1. LAIDLAW INVESTMENTS, LTD., an Ontario corporation (to be domesticated in Delaware as Laidlaw International, Inc.) 2. LAIDLAW TRANSPORTATION HOLDINGS, INC., a Delaware corporation 3. LAIDLAW TRANSPORTATION MANAGEMENT INC., an Ohio corporation 4. LAIDLAW MEDICAL HOLDINGS, INC., a Delaware corporation 5. LAIDLAW INTERNATIONAL FINANCE CORPORATION INC., a Delaware corporation 6. LAIDLAW USA, INC., a New York corporation 7. LAIDLAW TRANSPORTATION, INC., a Delaware corporation 8. LAIDLAW ONE INC., a Delaware corporation 9. LAIDLAW TWO, INC., a Delaware corporation 10. S.C. FOOD SERVICES (U.S.A.), INC., a Delaware corporation 11. CONCORDE ADJUSTERS, INC., a Delaware corporation 12. LAIDLAW TRANSIT HOLDINGS, INC., a Delaware corporation 13. LAIDLAW TRANSIT, INC., a Delaware corporation 14. ALLIED BUS SALES, INC., an Indiana corporation 15. LAIDLAW TRANSIT MANAGEMENT COMPANY, INC., a Pennsylvania corporation 16. CHATHAM COACH LINES, INC., a Delaware corporation 17. LAIDLAW TRANSIT SERVICES, INC., a Delaware corporation 18. SUTRAN, INC., a South Dakota corporation 19. VAN TRAN OF TUCSON, INC., an Arizona corporation 20. SAFE RIDE SERVICES, INC., an Arizona corporation EMCARE GROUP 21. EMCARE HOLDINGS INC., a Delaware corporation 22. EMCARE, INC., a Delaware corporation 23. AMERICAN EMERGENCY PHYSICIANS MANAGEMENT, INC., a California corporation 24. CHARLES T. MITCHELL, INC., a Hawaii corporation 25. COORDINATED HEALTH SERVICES, INC., a Pennsylvania corporation 26. ECEP, INC., a Missouri corporation 27. EMCARE ANESTHESIA SERVICES, INC., a Delaware corporation 28. EMCARE CONTRACT OF ARKANSAS, INC., an Arkansas corporation 29. EMCARE OF ALABAMA, INC., an Alabama corporation 30. EMCARE OF ARIZONA, INC., an Arizona corporation 31. EMCARE OF CALIFORNIA, INC., a California corporation 2 32. EMCARE OF COLORADO, INC., a Colorado corporation 33. EMCARE OF FLORIDA, INC., a Florida corporation 34. EMCARE OF GEORGIA, INC., a Georgia corporation 35. EMCARE OF HAWAII, INC., a Hawaii corporation 36. EMCARE OF INDIANA, INC., an Indiana corporation 37. EMCARE OF IOWA, INC., an Iowa corporation 38. EMCARE OF KENTUCKY, INC., a Kentucky corporation 39. EMCARE OF LOUISIANA, INC., a Louisiana corporation 40. EMCARE OF MARYLAND, LLC, a Maryland limited liability company 41. EMCARE OF MICHIGAN, INC., a Michigan corporation 42. EMCARE OF MINNESOTA, INC., a Minnesota corporation 43. EMCARE OF MISSISSIPPI, INC., a Mississippi corporation 44. EMCARE OF MISSOURI, INC., a Missouri corporation 45. EMCARE OF NEVADA, INC., a Nevada corporation 46. EMCARE OF NEW HAMPSHIRE, INC., a New Hampshire corporation 47. EMCARE OF NEW JERSEY, INC., a New Jersey corporation 48. EMCARE OF NEW MEXICO, INC., a New Mexico corporation 3 49. EMCARE OF NEW YORK, INC., a New York corporation 50. EMCARE OF NORTH CAROLINA, INC., a North Carolina corporation 51. EMCARE OF NORTH DAKOTA, INC., a North Dakota corporation 52. EMCARE OF OHIO, INC., an Ohio corporation 53. EMCARE OF OKLAHOMA, INC., an Oklahoma corporation 54. EMCARE OF OREGON, INC., an Oregon corporation 55. EMCARE OF PENNSYLVANIA, INC., a Pennsylvania corporation 56. EMCARE OF RHODE ISLAND, INC., a Rhode Island corporation 57. EMCARE OF SOUTH CAROLINA, INC., a South Carolina corporation 58. EMCARE OF TENNESSEE, INC., a Tennessee corporation 59. EMCARE OF TEXAS, INC., a Texas corporation 60. EMCARE OF VERMONT, INC., a Vermont corporation 61. EMCARE OF VIRGINIA, INC., a Virginia corporation 62. EMCARE OF WASHINGTON, INC., a Washington corporation 63. EMCARE OF WEST VIRGINIA, INC., a West Virginia corporation 64. EMCARE OF WISCONSIN, INC., a Wisconsin corporation 65. EMCARE PHYSICIAN SERVICES, INC., a Delaware corporation 4 66. EMCARE PHYSICIAN PROVIDERS, INC., a Missouri corporation 67. EMCARE SERVICES OF ILLINOIS, INC., an Illinois corporation 68. EMCARE SERVICES OF MASSACHUSETTS, INC., a Massachusetts corporation 69. EM-CODE REIMBURSEMENT SOLUTIONS, INC., a Delaware corporation 70. EMERGENCY MEDICINE EDUCATION SYSTEMS, INC., a Texas corporation 71. EMERGENCY SPECIALISTS OF ARKANSAS, INC. II, a Texas corporation 72. FIRST MEDICAL/EMCARE INC., a California corporation 73. HEALTHCARE ADMINISTRATIVE SERVICES, INC., a Delaware corporation 74. HELIX PHYSICIANS MANAGEMENT, INC., a California corporation 75. NORMAN BRUCE JETTON, INC., a California corporation 76. OLD STAT, INC., a Delaware corporation 77. PACIFIC EMERGENCY SPECIALISTS MANAGEMENT, INC., a California corporation 78. REIMBURSEMENT TECHNOLOGIES, INC., a Pennsylvania corporation 79. STAT PHYSICIANS, INC., a Florida corporation 80. THE GOULD GROUP, INC., a Texas corporation 5 81. TIFTON MANAGEMENT SERVICES, INC., a Georgia corporation 82. TUCKER EMERGENCY SERVICES, INC., a Georgia corporation AMERICAN MEDICAL RESPONSE GROUP 83. AMERICAN MEDICAL RESPONSE, INC., a Delaware corporation 84. AMBULANCE ACQUISITION, INC., a Delaware corporation 85. AMR BROCKTON, L.L.C., a Delaware limited liability company 86. MEDLIFE EMERGENCY MEDICAL SERVICE, INC., an Alabama corporation 87. METROPOLITAN AMBULANCE SERVICE, a California corporation 88. HANK'S ACQUISITION CORP., an Alabama corporation 89. AMERICAN MEDICAL RESPONSE OF INLAND EMPIRE, a California corporation 90. FOUNTAIN AMBULANCE SERVICE, INC., an Alabama corporation 91. GOLDEN GATE ASSOCIATES, a California corporation 92. FLORIDA EMERGENCY PARTNERS, INC., a Texas corporation 93. SAN FRANCISCO AMBULANCE SERVICE, INC., a California corporation 94. AMERICAN MEDICAL RESPONSE NORTHWEST, INC., an Oregon corporation 95. SPRINGS AMBULANCE SERVICE, INC., a California corporation 96. AMERICAN MEDICAL RESPONSE OF COLORADO, INC., a Delaware corporation 6 97. MEDEVAC MIDAMERICA, INC., a Missouri corporation 98. AMERICAN MEDICAL RESPONSE WEST, a California corporation 99. DESERT VALLEY MEDICAL TRANSPORT, INC., a California corporation 100. INTERNATIONAL LIFE SUPPORT, INC., a Hawaii corporation 101. MEDEVAC MEDICAL RESPONSE, INC., a Missouri corporation 102. AMERICAN MEDICAL RESPONSE OF OKLAHOMA, INC., a Delaware corporation 103. AMERICAN MEDICAL RESPONSE OF TEXAS, INC., a Delaware corporation 104. KUTZ AMBULANCE SERVICE, INC., a Wisconsin corporation 105. AMERICAN MEDICAL RESPONSE HOLDINGS, INC., a Delaware corporation 106. AMERICAN MEDICAL RESPONSE MANAGEMENT, INC., a Delaware corporation 107. REGIONAL EMERGENCY SERVICES, L.P., a Delaware limited partnership 108. A1 LEASING, INC., a Florida corporation 109. MOBILE MEDIC AMBULANCE SERVICE, INC., a Delaware corporation 110. METRO AMBULANCE SERVICES, INC., a Delaware corporation 111. METRO AMBULANCE SERVICE (RURAL), INC., a Delaware corporation 112. MEDIC ONE AMBULANCE SERVICES, INC., a Delaware corporation 113. AMERICAN MEDICAL RESPONSE OF SOUTH CAROLINA, INC., a Delaware corporation 7 114. AMERICAN MEDICAL RESPONSE OF NORTH CAROLINA, INC., a Delaware corporation 115. AMERICAN MEDICAL RESPONSE OF GEORGIA, INC., a Delaware corporation 116. RANDLE EASTERN AMBULANCE SERVICE, INC., a Florida corporation 117. MEDI-CAR SYSTEMS, INC., a Florida corporation 118. AMERICAN MEDICAL RESPONSE OF TENNESSEE, INC., a Delaware corporation 119. PHYSICIANS & SURGEONS AMBULANCE SERVICE, INC., an Ohio corporation 120. AMERICAN MEDICAL RESPONSE OF ILLINOIS, INC., a Delaware corporation 121. TROUP COUNTY EMERGENCY MEDICAL SERVICES, INC., a Georgia corporation 122. MEDI-CAR AMBULANCE SERVICE, INC., a Florida corporation 123. MIDWEST AMBULANCE MANAGEMENT COMPANY, a Delaware corporation 124. PARAMED, INC., a Michigan corporation 125. MERCY AMBULANCE OF EVANSVILLE, INC., an Indiana corporation 126. TIDEWATER AMBULANCE SERVICE, INC., a Virginia corporation 127. AMERICAN MEDICAL RESPONSE OF CONNECTICUT, INCORPORATED, a Connecticut corporation 128. ATLANTIC AMBULANCE SERVICES ACQUISITION, INC., a Delaware corporation 129. AMERICAN MEDICAL RESPONSE OF MASSACHUSETTS, INC., a Massachusetts corporation 130. ATLANTIC/KEY WEST AMBULANCE, INC., a Delaware corporation 8 131. AMERICAN MEDICAL RESPONSE MID-ATLANTIC, INC., a Pennsylvania corporation 132. ATLANTIC/PALM BEACH AMBULANCE, INC., a Delaware corporation 133. AMERICAN MEDICAL RESPONSE DELAWARE VALLEY, LLC, a Delaware limited liability company 134. SEMINOLE COUNTY AMBULANCE, INC., a Delaware corporation 135. METRO AMBULANCE SERVICE, INC., a Georgia corporation 136. LIFEFLEET SOUTHEAST, INC., a Florida corporation 137. BROWARD AMBULANCE, INC., a Delaware corporation 138. AMERICAN MEDICAL PATHWAYS, INC., a Delaware corporation 139. LAIDLAW MEDICAL TRANSPORTATION, INC., a Delaware corporation 140. LIFECARE AMBULANCE SERVICE, INC., an Illinois corporation 141. TEK, INC., an Illinois corporation 142. HEMET VALLEY AMBULANCE SERVICE, INC., a California corporation 143. MEDIC ONE OF COBB, INC., a Georgia corporation 144. GIEGER TRANSFER SERVICE, INC., a Mississippi corporation 145. MERCY LIFE CARE, a California corporation 146. AMERICAN MEDICAL RESPONSE OF SOUTHERN CALIFORNIA, a California corporation 147. PUCKETT AMBULANCE SERVICE, INC., a Georgia corporation 9 148. MERCY, INC., a Nevada corporation 149. AMERICAN INVESTMENT ENTERPRISES, INC., a Nevada corporation 150. ADAM TRANSPORTATION SERVICE, INC., a New York corporation 151. ASSOCIATED AMBULANCE SERVICE, INC., a New York corporation 152. PARK AMBULANCE SERVICE INC., a New York corporation 153. FIVE COUNTIES AMBULANCE SERVICE, INC., a New York corporation 154. SUNRISE HANDICAP TRANSPORT CORP., a New York corporation 10