UNITED STATES SECURITIES AND EXCHANGE COMMISSION

FORM 10-K

		(Mark One)
		X		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

For the Fiscal Year Ended October 31, 2003

                      OR          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

Commission File Number 1-8929

Delaware		94-1369354
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification Number)
160 Pacific Avenue, Suite 222, San Francisco, California		94111
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (415) 733-4000

Title of Each Class		Name of Each Exchange on Which Registered
Common Stock, $.01 par value		New York Stock Exchange
Preferred Stock Purchase Rights		New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes X  No  

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.       

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).  Yes X  No  

As of April 30, 2003 (the last business day of registrant’s most recently completed second fiscal quarter), non-affiliates of the registrant beneficially owned shares of the registrant’s common stock with an aggregate market value of $541,504,655, computed by reference to the price at which the common stock was last sold.

As of December 31, 2003, there were 48,530,777 shares of the registrant’s common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statement to be used by the Company in connection with its 2004 Annual Meeting of Stockholders are incorporated by reference into Part III of this Form 10-K.

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ABM Industries Incorporated

				Page
Part I
Item 1.		Business			3
		Executive Officers of the Registrant			7
Item 2.		Properties			8
Item 3.		Legal Proceedings			8
Item 4.		Submission of Matters to a Vote of Security Holders			8
Part II
Item 5.		Market for the Registrant’s Common Equity and Related Stockholder Matters			9
Item 6.		Selected Financial Data			10
Item 7.		Management’s Discussion and Analysis of Financial Condition and Results of Operations			11
Item 7A.		Quantitative and Qualitative Disclosures About Market Risk			25
Item 8.		Financial Statements and Supplementary Data			26
Item 9.		Changes in and Disagreements With Accountants on Accounting and Financial Disclosure			48
Item 9A.		Controls and Procedures			48
Part III
Item 10.		Directors and Executive Officers of the Registrant			48
Item 11.		Executive Compensation			48
Item 12.		Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			48
Item 13.		Certain Relationships and Related Transactions			49
Item 14.		Principal Accountant Fees and Services			49
Part IV
Item 15.		Exhibits, Financial Statement Schedules and Reports on Form 8-K			49
		Signatures			50
		Schedule II			51
		Exhibit Index			52

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PART I

ITEM 1. BUSINESS

       ABM Industries Incorporated (“ABM”) is one of the largest facility services contractors listed on the New York Stock Exchange. With annual revenues in excess of $2.2 billion and more than 64,000 employees, ABM and its subsidiaries (the “Company”) provide janitorial, parking, engineering, security, lighting and mechanical services for thousands of commercial, industrial, institutional and retail facilities in hundreds of cities in the United States and British Columbia, Canada.

      The Company also provided elevator services until August 15, 2003, on which date substantially all of the operating assets of Amtech Elevator Services, Inc., a wholly-owned subsidiary of ABM (“Amtech Elevator”), were sold to Otis Elevator Company, a wholly-owned subsidiary of United Technologies Corporation (“Otis Elevator”). See “Discontinued Operation” contained in Item 7.

      ABM was reincorporated in Delaware on March 19, 1985, as the successor to a business founded in California in 1909. The corporate headquarters of the Company is located at 160 Pacific Avenue, Suite 222, San Francisco, California 94111, and the Company’s telephone number at that location is (415) 733-4000. The Company’s Website is www.abm.com. Through a link on the Investor Relations section of the Company’s Website, the following filings are made available as soon as reasonably practicable after they are electronically filed with or furnished to the SEC: (1) Annual Reports on Form 10-K, (2) Quarterly Reports on Form 10-Q, (3) Current Reports on Form 8-K and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as well as (4) the Section 16 filings by ABM’s directors and executive officers. All such filings are available free of charge. In addition, ABM makes available on its Website certain materials related to its corporate governance.

Industry Information

      The Company conducts business through a number of subsidiaries, which are grouped into seven segments based on the nature of the business operations. The operating subsidiaries within each segment generally report to the same senior management. Referred to collectively as the “ABM Family of Services,” at October 31, 2003 the seven segments were:

         • Janitorial

     The Company also provided elevator services until August 15, 2003 when it sold substantially all of the operating assets of its Elevator segment. See “Discontinued Operation” contained in Item 7.

      The business activities of the Company by industry segment, as they existed at October 31, 2003, are more fully described below.

      • Janitorial. The Company performs janitorial services through a number of the Company’s subsidiaries, primarily operating under the names “ABM Janitorial Services,” “American Building Maintenance” and “ABM Lakeside Building Maintenance.” The Company provides a wide range of basic janitorial services for a variety of facilities, including commercial office buildings, industrial plants, financial institutions, retail stores, shopping centers, warehouses, airport terminals, health and educational facilities, stadiums and arenas, and government buildings. Services provided include floor cleaning and finishing, window washing, furniture polishing, carpet cleaning and dusting, as well as other building cleaning services. The Company’s Janitorial subsidiaries maintain 111 offices in 42 states, the District of Columbia and one Canadian province, and operate under thousands of individually negotiated building maintenance contracts, nearly all of which are obtained by competitive bidding. The Company’s Janitorial contracts are either fixed-price agreements or they contain clauses under which the customer agrees to reimburse the full amount of wages, payroll taxes, insurance charges and other expenses plus a profit percentage. Generally, profit margins on maintenance contracts tend to be inversely proportional to the size of the contract. The majority of Janitorial contracts are for one-year periods, but are subject to termination by either party after 30 to 90 days’ written notice and contain automatic renewal clauses.

      • Parking. The Company provides parking services through a number of subsidiaries, primarily operating under the names “Ampco System Parking” “Ampco System Airport Parking” and “Ampco Express Airport Parking.” The Company’s Parking

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      • Engineering. The Company provides engineering services through a number of subsidiaries, primarily operating under the name “ABM Engineering Services.” The Company provides facilities with on-site engineers to operate, maintain and repair electrical, energy management, mechanical and plumbing systems utilizing in part computerized maintenance management systems. These services are designed to maintain equipment at optimal efficiency for customers such as high-rise office buildings, schools, computer centers, shopping malls, manufacturing facilities, museums and universities. The Company’s Engineering subsidiaries operate in 23 states through 13 branch and regional offices, five of which are in California and one each in Arizona, Colorado, Florida, Illinois, Massachusetts, New York, Pennsylvania and Texas. The majority of Engineering contracts contain clauses under which the customer agrees to reimburse the full amount of wages, payroll taxes, insurance charges and other expenses plus a profit percentage. Additionally, the majority of Engineering contracts are for one-year periods, but are subject to termination by either party after 30 to 90 days’ written notice. ABM Engineering Services Company, a wholly-owned subsidiary has maintained ISO 9002 Certification for the past five years, the only national engineering services provider of on-site operating engineers to earn this prestigious designation. ISO is a quality standard comprised of a rigorous set of guidelines and good business practices against which companies are evaluated through a comprehensive independent audit process.

      • Security. The Company provides security services through a number of subsidiaries, primarily operating under the names “American Commercial Security Services,” “ACSS” and “ABM Security Services.” The Company provides security guards; electronic monitoring of fire, life safety systems and access control devices; and security consulting services to a wide range of businesses. The Company’s Security subsidiaries maintain 25 offices and operates in the major metropolitan areas of Phoenix, Arizona; Los Angeles, Sacramento, San Diego, San Francisco and Santa Clara, California; Chicago, Illinois; New Orleans, Louisiana; Minneapolis, Minnesota; Portland, Oregon; Houston, Dallas, Fort Worth, Austin and San Antonio, Texas; Seattle, Washington; New York City, New York; and Philadelphia and Pittsburgh, Pennsylvania. The sales under the majority of Security contracts are based on actual hours of service at contractually specified rates. Additionally, the majority of Security contracts are for one-year periods, but are subject to termination by either party after 30 to 90 days’ written notice and contain automatic renewal clauses.

      • Lighting. The Company provides lighting services through a number of subsidiaries, primarily operating under the name “Amtech Lighting Services.” The Company provides relamping, fixture cleaning, and periodic lighting maintenance service to a variety of commercial, industrial and retail facilities. The Company’s Lighting subsidiaries also repair and maintain electrical outdoor signage, and provide electrical service and repairs. The Company’s Lighting subsidiaries operate 27 offices, eight of which are located in California, four in Texas, two in North Carolina, and one office in each of the following states: Alabama, Arizona, Florida, Georgia, Illinois, Kentucky, Louisiana, Minnesota,

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      • Mechanical. The Company provides mechanical services through a number of subsidiaries, primarily operating under the names “CommAir Mechanical Services” and “CommAir Preferred Mechanical Services.” The Company installs, maintains and repairs heating, ventilation and air conditioning and refrigeration equipment, performs chemical water treatment and provides energy conservation services for commercial, industrial and institutional facilities. The Company’s Mechanical subsidiaries maintain nine offices, eight of which are located in California and one in Phoenix, Arizona. Mechanical contracts are either fixed-price agreements or time and materials based where the customer is billed according to actual hours of service and materials used at contractually specified prices. The majority of such contracts are for one-year periods, but are subject to termination by either party after 30 to 90 days’ written notice. Contracts for projects, however, typically cannot be cancelled.

      • Facility Services. The Company provides facility services through a number of subsidiaries, primarily operating under the name “ABM Facility Services.” The Company provides customers with streamlined, centralized control and coordination of multiple facility service needs. This process is consistent with the greater competitive demands on corporate organizations to become more efficient in the business market today. By leveraging the core competencies of the Company’s other service offerings, the Company attempts to reduce overhead (such as redundant personnel) for its customers by providing multiple services under a single contract, with one contact and one invoice. Its National Service Call Center provides centralized dispatching, emergency services, accounting and related reports to financial institutions, high-tech companies and other customers regardless of industry or size. Facility Services is headquartered in San Francisco, where it also maintains its National Service Call Center.

      Additional information relating to the Company’s industry segments appears in Note 13 of Notes to Consolidated Financial Statements.

Trademarks

      The Company believes that it owns or is licensed to use all corporate names, tradenames, trademarks, service marks, copyrights, patents and trade secrets which are material to the Company’s operations.

Competition

      The Company believes that each aspect of its business is highly competitive, and that such competition is based primarily on price and quality of service. The Company provides nearly all its services under contracts originally obtained through competitive bidding. The low cost of entry to the facilities services business has led to strongly competitive markets made up of large numbers of mostly regional and local owner-operated companies, located in major cities throughout the United States and in British Columbia, Canada (with particularly intense competition in its janitorial business in the Southeast and South Central regions of the United States). The Company also competes with the operating divisions of a few large, diversified facility service and manufacturing companies on a national basis. Indirectly, the Company competes with building owners and tenants that perform internally one or more of the services provided by the Company. These building owners and tenants might have a competitive advantage when the Company’s services are subject to sales tax and internal operations are not. Furthermore, competitors may have lower costs because privately-owned companies operating in a limited geographic area may have significantly lower labor and overhead costs. These strong competitive pressures could inhibit the Company’s success in bidding for profitable business and its ability to increase prices even as costs rise, thereby reducing margins.

Sales and Marketing

      The Company’s sales and marketing efforts are conducted by its corporate, subsidiary, region, branch and district offices. Sales, marketing, management and operations personnel in each of these offices participate directly in selling and servicing customers. The broad geographic scope of these offices enables

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      The Company has a broad customer base, including, but not limited to, commercial office buildings, industrial plants, financial institutions, retail stores, shopping centers, warehouses, airports, health and educational facilities, stadiums and arenas, government buildings, apartment complexes, and theme parks. No customer accounted for more than 5% of its revenues during the fiscal year ended October 31, 2003.

Employees

      The Company employs over 64,000 persons, of whom the vast majority are service employees who perform janitorial, parking, engineering, security, lighting and mechanical services. Approximately 28,000 of these employees are covered under collective bargaining agreements at the local level. There are about 3,700 employees with executive, managerial, supervisory, administrative, professional, sales, marketing or clerical responsibilities, or other office assignments.

Environmental Matters

      The nature of the Company’s operations, primarily services, would not ordinarily involve it in environmental contamination. However, the Company’s operations are subject to various federal, state and/or local laws regulating the discharge of materials into the environment or otherwise relating to the protection of the environment, such as discharge into soil, water and air, and the generation, handling, storage, transportation and disposal of waste and hazardous substances. These laws generally have the effect of increasing costs and potential liabilities associated with the conduct of the Company’s operations, although historically they have not had a material adverse effect on the Company’s financial position, results of operations, or cash flows.

      The Company is currently involved in two proceedings relating to environmental matters: one involving alleged potential soil contamination at a former Company facility in Arizona and one involving alleged potential soil and groundwater contamination at a Company facility in Florida. While it is difficult to predict the ultimate outcome of these matters, based on information currently available, management believes that neither of these matters, individually or in the aggregate, are reasonably likely to have a material adverse effect on the Company’s financial position, results of operations, or cash flows. As any liability related to these claims is neither probable nor estimable, no accruals have been made related to these matters.

      Three other environmental proceedings were settled during fiscal year 2003 for approximately $0.6 million.

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Executive Officers of the Registrant

      The executive officers of ABM are as follows:

						Principal Occupations and Business Experience
Name		Age				During Past Five Years
Henrik C. Slipsager			49			President & Chief Executive Officer and a Director of ABM since November 2000; Executive Vice President of ABM and President of ABM Janitorial Services, from November 1999 through October 2000; Senior Vice President of ABM from March 1998 through October 1999; Executive Vice President of ABM Janitorial Services from January 1997 through October 1999.
Jess E. Benton III			63			Chief Operating Officer of ABM since November 2000; Executive Vice President since November 1999; Senior Vice President from July 1994 through October 1999.
James P. McClure			46			Executive Vice President of ABM since September 2002; President of ABM Janitorial Services since November 2000; Senior Vice President of ABM Janitorial Services from July 1997 through October 2000.
Linda S. Auwers			56			Senior Vice President, General Counsel & Secretary of ABM since May 2003; Vice President, Deputy General Counsel and Secretary of Compaq Computer Corporation from May 2001 through May 2002; Vice President, Secretary and Associate General Counsel of Compaq Computer Corporation from September 1999 to April 2001; Vice President and Assistant General Counsel of Compaq Computer Corporation from 1995 to September 1999.
Donna M. Dell			55			Senior Vice President of Human Resources of ABM since November 1999; Chief Employment Counsel since April 1997; Vice President of Human Resources from July 1994 through October 1999.
George B. Sundby			52			Senior Vice President & Chief Financial Officer of ABM since June 2001; Senior Vice President & Chief Financial Officer of Transamerica Finance Corporation from September 1999 through March 2001; Vice President of Financial Planning and Analysis of Transamerica Corporation from January 1995 through March 2001.
Gary R. Wallace			54			Senior Vice President of ABM, Director of Business Development & Chief Marketing Officer since November 2000; Senior Vice President of ABM Janitorial Services from September 1995 through October 2000.
Steven M. Zaccagnini			42			Senior Vice President of ABM since September 2002; President of CommAir Mechanical Services since September 2002; President of ABM Facility Services since April 2002; Senior Vice President of Jones Lang LaSalle from April 1995 through February 2002.
Maria De Martini			44			Vice President, Controller & Chief Accounting Officer of ABM since July 2001; Controller of Vectiv Corporation from March 2001 through June 2001; Assistant Controller of Transamerica Finance Corporation from December 1999 through March 2001; Director of Accounting of Transamerica Corporation from December 1997 through November 1999.
David L. Farwell			42			Vice President & Treasurer of ABM since August 2002; Treasurer of JDS Uniphase Corporation from December 1999 through April 2002; Assistant Treasurer of Acuson Corporation from October 1997 through December 1999.

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ITEM 2. PROPERTIES

       The Company has corporate, subsidiary, regional, branch or district offices in over 220 locations throughout the United States and in British Columbia, Canada. Fourteen of these facilities are owned by the Company. At October 31, 2003, the real estate owned by the Company had an aggregate net book value of $3.4 million and was located in: Phoenix, Arizona; Fresno, California; Jacksonville and Tampa, Florida; Portland, Oregon; Arlington, Houston and San Antonio, Texas; and Kennewick, Seattle, Spokane and Tacoma, Washington.

      Rental payments under long and short-term lease agreements amounted to $96.9 million for the fiscal year ended October 31, 2003. Of this amount, $64.2 million in rental expense was attributable to public parking lots and garages leased and operated by Parking. The remaining expense was for the rental or lease of office space, computers, operating equipment and motor vehicles.

ITEM 3. LEGAL PROCEEDINGS

       In September 1999, a former employee filed a gender discrimination lawsuit against ABM in the state of Washington. On May 19, 2003, a Washington state court jury for the Spokane County Superior Court, in the case named Forbes v. ABM, awarded $4.0 million in damages, and the court later awarded costs of $0.7 million to the former employee. In addition, the court may award the plaintiff up to $0.8 million to mitigate the federal tax impact of the plaintiff’s award (the Washington Supreme Court is currently deciding whether amounts to mitigate federal tax consequences may be awarded in wrongful termination cases). ABM will appeal the jury’s verdict to the State Court of Appeals as well as the award of costs on the grounds that it was denied a fair trial. There can be no assurance that ABM will prevail in this matter. ABM, however, believes that the award against ABM was excessive and that the verdict was inconsistent with the law and the evidence. Because ABM believes that the judgment will be reversed upon appeal, ABM has not recorded any liability in its financial statements associated with the judgment. However, as of October 31, 2003, ABM has incurred and recorded legal fees of $0.1 million associated with the appeal. These fees, which include the cost of a new trial, are expected to total approximately $0.4 million.

      The Company and some of its subsidiaries have been named defendants in certain other litigation arising in the ordinary course of business. In the opinion of management, based on advice of legal counsel, such matters should have no material effect on the Company’s financial position, results of operations or cash flows.

ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

       Not applicable.

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PART II

ITEM 5.	MARKET FOR THE REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

       ABM’s common stock is listed on the New York Stock Exchange. The following table sets forth the high and low intra-day prices of ABM’s common stock on the New York Stock Exchange and quarterly cash dividends declared on common shares for the periods indicated:

			Fiscal Quarter
			First				Second				Third				Fourth				Year
Fiscal Year 2003
Price range of common stock:
	High		$	16.36			$	16.34			$	16.73			$	16.57			$	16.73
	Low		$	13.50			$	12.50			$	13.25			$	13.94			$	12.50
Dividends declared per share			$	0.095			$	0.095			$	0.095			$	0.095			$	0.38
Fiscal Year 2002
Price range of common stock:
	High		$	16.40			$	19.43			$	19.75			$	17.69			$	19.75
	Low		$	13.36			$	14.88			$	14.00			$	12.92			$	12.92
Dividends declared per share			$	0.09			$	0.09			$	0.09			$	0.09			$	0.36

      At December 31, 2003, there were 4,199 registered holders of ABM’s common stock, in addition to stockholders in street name. To the Company’s knowledge, there are no current factors that are likely to materially limit the Company’s ability to pay comparable dividends for the foreseeable future.

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ITEM 6. SELECTED FINANCIAL DATA

     The following selected financial data is derived from the Company’s consolidated financial statements for each of the years in the five-year period ended October 31, 2003. It should be read in conjunction with the consolidated financial statements and the notes thereto, as well as the “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which are included elsewhere in this report.

Years ended October 31,				2003				2002				2001				2000				1999
(in thousands, except per share data and ratios)
Operations (1) and (2)
Revenues
	Sales and other income		$	2,262,476			$	2,068,058			$	2,027,800			$	1,879,450			$	1,701,532
	Gain on insurance claim			—				10,025				—				—				—
				2,262,476				2,078,083				2,027,800				1,879,450				1,701,532
Expenses
	Operating expenses and cost of goods sold			2,035,731				1,855,980				1,820,081				1,666,250				1,504,626
	Selling, general and administrative			171,135				156,042				144,927				133,013				124,605
	Interest			758				1,052				2,600				3,319				1,959
	Goodwill amortization (3)			—				—				12,065				11,006				9,569
				2,207,624				2,013,074				1,979,673				1,813,588				1,640,759
Income from continuing operations before income taxes				54,852				65,009				48,127				65,862				60,773
Income taxes				18,454				20,951				18,259				25,747				25,078
Income from continuing operations				36,398				44,058				29,868				40,115				35,695
Income from discontinued operation, net of income taxes				2,560				2,670				2,958				4,228				3,972
Gain on sale of discontinued operation, net of income taxes				51,500				—				—				—				—
Net income			$	90,458			$	46,728			$	32,826			$	44,343			$	39,667
Net income per common share — Basic
	Income from continuing operations		$	0.74			$	0.90			$	0.62			$	0.88			$	0.80
	Income from discontinued operation			0.05				0.05				0.06				0.09				0.09
	Gain on sale of discontinued operation			1.05				—				—				—				—
			$	1.84			$	0.95			$	0.68			$	0.97			$	0.89
Net income per common share — Diluted
	Income from continuing operations		$	0.73			$	0.86			$	0.59			$	0.83			$	0.74
	Income from discontinued operation			0.05				0.06				0.06				0.09				0.08
	Gain on sale of discontinued operation			1.03				—				—				—				—
			$	1.81			$	0.92			$	0.65			$	0.92			$	0.82
Average common and common equivalent shares
	Basic			49,065				49,116				47,598				45,102				44,134
	Diluted			50,004				51,015				50,020				47,418				47,496
Financial Statistics
Dividends declared per common share			$	0.38			$	0.36			$	0.33			$	0.31			$	0.28
Stockholders’ equity			$	444,036			$	386,670			$	361,177			$	316,309			$	276,951
Common shares outstanding				48,367				48,997				48,778				45,998				44,814
Stockholders’ equity per common share (4)			$	9.18			$	7.89			$	7.40			$	6.88			$	6.18
Working capital			$	243,957			$	215,070			$	229,542			$	224,199			$	184,279
Net operating cash flows from continuing operations			$	53,720			$	100,020			$	66,069			$	19,242			$	32,157
Current ratio				1.95				1.95				1.97				2.05				2.01
Long-term debt (less current portion)			$	—			$	—			$	942			$	36,811			$	28,903
Redeemable cumulative preferred stock			$	—			$	—			$	—			$	6,400			$	6,400
Total assets			$	795,983			$	704,939			$	683,100			$	641,985			$	563,384
Assets held for sale			$	—			$	32,136			$	41,362			$	37,283			$	32,162
Trade accounts receivable — net			$	287,906			$	296,634			$	336,512			$	325,799			$	268,812
Goodwill			$	201,866			$	164,009			$	109,292			$	105,308			$	101,292
Property, plant and equipment — net			$	30,123			$	35,846			$	42,425			$	40,149			$	34,681
Capital expenditures			$	11,621			$	7,345			$	16,667			$	18,327			$	19,097
Depreciation and intangible amortization			$	14,829			$	14,955			$	13,823			$	12,010			$	10,556

     (1) Certain prior year amounts have been reclassified to conform to the current year presentation. The results from operations of the Company’s Elevator segment, which was sold on August 15, 2003, have been classified as income from discontinued operation and the assets and liabilities have been classified as held for sale in the accompanying consolidated financial statements and this table.

     (2) The World Trade Center represented the Company’s largest worksite; its destruction has directly and indirectly impacted subsequent Company results. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

     (3) In 2002, the Company adopted SFAS No. 142 under which goodwill is no longer amortized, but is subject to at least an annual assessment for impairment.

     (4) Stockholders’ equity per common share is calculated by dividing stockholders’ equity at the end of the fiscal year by the number of shares of common stock outstanding at that date. This calculation may not be comparable to similarly titled measures reported by other companies.

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ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

       The following discussion should be read in conjunction with the consolidated financial statements of the Company and the notes thereto contained in Item 8, “Financial Statements and Supplementary Data.” All information in the discussion and references to the years are based on the Company’s fiscal year that ends on October 31.

Overview

      The Company provides janitorial, parking, engineering, security, lighting and mechanical services for thousands of commercial, industrial, institutional and retail facilities in hundreds of cities in the United States and British Columbia, Canada. The Company also provided elevator services until August 15, 2003, when it sold substantially all of the operating assets of its Elevator segment (see “Discontinued Operation”). The largest segment of the Company’s business is Janitorial which generated over 60% of the Company’s sales and other income from continuing operations (hereinafter called “sales”) and over 64% of its operating profit before corporate expenses for fiscal 2003.

      The Company’s sales are substantially based on the performance of labor-intensive services at contractually specified prices. Janitorial and other maintenance service contracts are either fixed-price or “cost-plus” (i.e., the customer agrees to reimburse the full amount of wages, payroll taxes, insurance charges and other expenses plus a profit percentage). The majority of the Company’s contracts are for one-year periods, but are subject to termination by either party after 30 to 90 days’ written notice. In addition to services defined within the scope of the contract, the Company also generates sales from extra services where the customer might require additional cleaning or emergency repair services.

      Sales have historically been the major source of cash for the Company while payroll expenses, which are directly related to sales, have been the largest use of cash. Hence operating cash flows significantly depend on the sales level and timing of collections, as well as the quality of the customer receivable. The timing and level of the payments to suppliers and other vendors, as well as the magnitude of self-insured claims, also affect operating cash flows. The Company’s management views operating cash flows as a good indicator of financial strength. Strong operating cash flows provide opportunities for growth both internally and through acquisitions.

      The Company faces many challenges that affect its sales and profitability. Recent results have been negatively influenced by declines in office building occupancy, weakness in airline travel and the hospitality industry and a slowdown in capital investment by customers. In the long run, achieving the desired levels of sales and profitability will depend on the Company’s ability to retain more customers than it loses, at acceptable profit margins, in the face of competition, particularly from privately-owned companies that typically have the lower cost advantage.

Financial Condition

      Funds provided from operations and bank borrowings have historically been the sources for meeting working capital requirements, financing capital expenditures and acquisitions, and paying cash dividends. Management believes that funds from these sources will remain available and adequately serve the Company’s liquidity needs. Additionally, the Company received a total of $112.4 million in cash proceeds from the Elevator divestiture during 2003 (see “Discontinued Operation”).

      During 2003, 2002 and 2001, operating activities generated net cash of $60.1 million, $110.9 million and $65.8 million, respectively. Cash from operations was higher in 2002 compared to 2003 and 2001 primarily due to greater collection of outstanding accounts receivable during 2002. In addition, cash from operations for the year ended October 31, 2002 included the receipt of two partial settlements totaling $13.3 million in gross insurance proceeds related to the World Trade Center (“WTC”) insurance claim.

      Net cash provided by investing activities in 2003 was $66.1 million, compared to net cash used in investing activities in 2002 and 2001 of $59.3 million and $27.0 million, respectively. The increase in net cash provided by investing activities in 2003 from 2002 was due to the $112.4 million proceeds received from the Elevator divestiture during 2003 (see “Discontinued Operation”). Net cash used for the purchase of business in 2003 was $40.6 million compared to $52.4 million in 2002 of which $36.9 million was used for the initial payment for the purchase of the operations of Lakeside Building Maintenance, Inc. and an affiliated company (collectively, “Lakeside”) in July 2002, the largest acquisition ever made by the Company. The increase in cash used in investing activities in 2002 from 2001 primarily reflects the payment for the acquisition of

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      Net cash used in financing activities was $34.7 million in 2003, $35.2 million in 2002 and $37.7 million in 2001. The decrease in 2003 from 2002 was primarily due to no debt repayments in 2003 compared to $11.8 million in 2002, offset by greater common stock purchases and lower common stock issuance in 2003. The slight decrease in net cash used in financing activities in 2002 from 2001 was primarily due to reduced debt repayments partially offset by common stock purchases in 2002.

      On September 16, 2001, the Company’s Board of Directors authorized the purchase of up to 2.0 million shares of the Company’s outstanding common stock at any time through December 31, 2001, which authorization was later extended through January 31, 2003. As of October 31, 2002, the Company had purchased 1.4 million shares at a cost of $23.6 million (an average price per share of $16.88). In the three months ended January 31, 2003, the Company purchased the remaining 0.6 million shares at a cost of $9.3 million (an average price per share of $15.50).

      On March 11, 2003, the Company’s Board of Directors authorized the purchase of up to 2.0 million additional shares of the Company’s outstanding common stock at any time through December 31, 2003. As of October 31, 2003, the Company purchased 1.4 million shares under this authorization at a cost of $21.1 million (an average price per share of $15.04) and 0.6 million shares were available for purchase.

      On December 9, 2003, the Company’s Board of Directors authorized the purchase of up to 2.0 million additional shares of the Company’s outstanding common stock at any time through December 31, 2004.

      In April 2003, the Company increased the amount of its syndicated line of credit, which will expire July 1, 2005, to $250.0 million. As amended, no compensating balances are required under the facility and the interest rate is determined at the time of borrowing based on the London Interbank Offered Rate (“LIBOR”) plus a spread of 0.875% to 1.50% or, for overnight borrowings, at the prime rate plus a spread of 0.00% to 0.25% or, for overnight to one week, at the Interbank Offered Rate (“IBOR”) plus a spread of 0.875% to 1.50%. The spread for LIBOR, prime and IBOR borrowings is based on the Company’s leverage ratio. The facility calls for a commitment fee payable quarterly, in arrears, of 0.20%, as amended, based on the average daily unused portion. For purposes of this calculation, irrevocable standby letters of credit issued primarily in conjunction with the Company’s self-insurance program plus cash borrowings are considered to be outstanding amounts. As of October 31, 2003 and 2002, the total outstanding amounts under this facility were $69.0 million and $102.0 million, respectively, in the form of standby letters of credit. The decrease is due to the reduction of the use of standby letters of credit for certain self-insurance agreements, specifically in the State of California where the Company now participates in the state’s Self-Insurers’ Security Fund in lieu of standby letters of credit. The provisions of the credit facility require the Company to maintain certain financial ratios and limit outside borrowings. The Company was in compliance with all covenants as of October 31, 2003. The Company’s effective weighted average interest rate (excluding amortization of related fees) for all LIBOR, prime and IBOR borrowings for the year ended October 31, 2003 was 2.60%.

      Working capital increased by $28.9 million to $244.0 million at October 31, 2003 from $215.1 million at October 31, 2002 primarily due to the net impact of the Elevator divestiture during 2003 (see “Discontinued Operation”). The largest component of working capital consists of trade accounts receivable that totaled $287.9 million at October 31, 2003, compared to $296.6 million at October 31, 2002. These amounts were net of allowances for doubtful accounts of $6.3 million and $5.5 million at October 31, 2003 and October 31, 2002, respectively. As of October 31, 2003, accounts receivable that were over 90 days past due had decreased $8.5 million to $28.2 million (9.8% of the total net outstanding) from $36.7 million (12.4% of the total net outstanding) at October 31, 2002.

      The Company self-insures certain insurable risks such as general liability, automobile property damage, and workers’ compensation. Commercial umbrella policies are obtained to provide for $150.0 million of coverage above the self-insured retention limits (i.e., deductible). For claims incurred after November 1, 2002, substantially all of the self-insured retentions increased from $0.5 million to $1.0 million. Effective April 14, 2003, the deductible for California workers’ compensation insurance increased to $2.0 million per

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Insurance Claims Related to the Destruction of the World Trade Center in New York City on September 11, 2001

      The Company had commercial insurance policies covering business interruption, property damage and other losses related to this tragic incident. As previously reported by the Company, the WTC complex in New York was the Company’s largest single job-site with annual sales of approximately $75.0 million (3% of the Company’s consolidated sales for 2001). The Company provided its insurance carrier, Zurich Insurance (“Zurich”), claim information regarding the lost business income and, as described further below, substantially settled the property portion of the claim. As of October 31, 2002, Zurich had paid two partial settlements totaling $13.3 million, of which $10.0 million was for business interruption and $3.3 million for property damage. The Company realized a pretax gain of $10.0 million in 2002 on the proceeds received.

      In December 2001, Zurich filed a Declaratory Judgment Action in the Southern District of New York claiming the loss of the business profit falls under the policy’s contingent business interruption sub-limit of $10.0 million. On June 2, 2003, the court ruled on certain summary judgment motions in favor of Zurich. Subsequent to the June ruling, additional rulings by the court have limited the Company’s recourse under the policy to the amounts paid plus additional amounts related to physical property of the Company located on the WTC premises and certain accounts receivable from customers that could not be collected. Based on a review of the policy and consultation with legal counsel and other specialists, the Company continues to believe that its business interruption claim does not fall under the $10.0 million sub-limit on contingent business interruption and that the Company’s losses under its WTC contracts are eligible for additional business interruption coverage up to the policy maximum of $124.0 million. Therefore, the Company is appealing the court’s rulings.

      Under the guidance published by the Emerging Issues Task Force (“EITF”) of the Financial Accounting Standards Board (“FASB”) “Accounting for the Impact of the Terrorist Attacks of September 11, 2001,” the Company has not recognized future amounts it expects to recover from its business interruption insurance as income. Any gain from insurance proceeds is considered a contingent gain and, under Statement of Financial Accounting Standards (“SFAS”) No. 5, “Accounting for Contingencies,” can only be recognized as income in the period when any and all contingencies for that portion of the insurance claim have been resolved.

Off-Balance Sheet Arrangements

      As of October 31, 2003, the Company does not have any off-balance sheet arrangements as defined by Item 303(a)(4) of the Securities and Exchange Commission Regulation S-K.

Effect of Inflation and Energy Crisis

      The low rates of inflation experienced in recent years have had no material impact on the financial statements of the Company. The Company attempts to recover increased costs by increasing sales prices to the extent permitted by contracts and competition.

      The energy crisis in the State of California has not had a material impact on the Company.

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Contractual Obligations, Commercial Commitments and Other Long-Term Liabilities

      The Company is contractually obligated to make future payments under non-cancelable operating lease agreements for various facilities, vehicles, and other equipment. As of October 31, 2003, future contractual payments were as follows:

(in thousands)		Payments Due By Period
Contractual Obligations		Total		Less than 1 year		1 – 3 years		4 – 5 years		After 5 years
Operating Leases		$195,454		$44,042		$59,010		$32,528		$59,874

      Additionally, the Company has the following commercial commitments and other long-term liabilities:

(in thousands)		Amounts of Commitment Expiration Per Period
Commercial Commitments		Total Amounts Committed		Less than 1 year		1 – 3 years		4 – 5 years		After 5 years
Standby Letters of Credit		$69,018		$69,018		—		—		—
Financial Responsibility Bonds		4,211		4,211		—		—		—
Total		$73,229		$73,229		—		—		—

(in thousands)		Payments Due By Period
Other Long-Term Liabilities		Total		Less than 1 year		1 – 3 years		4 – 5 years		After 5 years
Retirement Plans		$40,515		$2,212		$4,301		$4,831		$29,171

      Although a portion of insurance claims is classified as long-term liabilities, insurance claims are not included in the above table as they are not contractual obligations.

Acquisitions and Divestitures

      The operating results of businesses acquired have been included in the accompanying consolidated financial statements from their respective dates of acquisition and acquisitions made in 2003 are discussed in Note 9 of Notes to Consolidated Financial Statements contained in Item 8, “Financial Statements and Supplementary Data.” Acquisitions made during the three years ended October 31, 2003 contributed approximately $334.6 million (14.8%) to 2003 sales.

      On April 30, 2001, the Company sold Easterday for $12.0 million and realized a pretax gain of $0.7 million. Prior to its sale, Easterday’s operating results were included in “Other” segment.

      On August 15, 2003, ABM sold substantially all of the operating assets of Amtech Elevator, which represented the Company’s Elevator segment, to Otis Elevator. The consideration in connection with the sale included $112.4 million in cash and Otis Elevator’s assumption of trade payables and accrued liabilities. The Company realized a gain on the sale of $51.5 million, net of $31.9 million of income taxes. See “Discontinued Operation.”

Results of Continuing Operations

      In July 2001, the FASB issued SFAS No. 142, “Goodwill and Other Intangible Assets.” SFAS No. 142 became effective in fiscal years beginning after December 15, 2001, with early adoption permitted. The Company adopted the provisions of SFAS No. 142 beginning with the first quarter of 2002. In accordance with this standard, goodwill is no longer amortized, but is subject to an annual assessment for impairment. The Company is required to perform goodwill impairment tests on an annual basis and, in certain circumstances, between annual tests. As of October 31, 2003, no impairment of the Company’s goodwill carrying value has been indicated. For comparative purposes, goodwill amortization has been segregated from the operating profits of the segments for the year ended October 31, 2001 and reported separately.

      In January 2002, the EITF released Issue No. 01-14, “Income Statement Characterization of Reimbursements Received for Out-of-Pocket Expenses Incurred,” which the Company adopted in fiscal 2002. For the Company’s Parking segment this pronouncement requires both revenues and expenses be recognized, in equal amounts, for costs directly reimbursed from its managed parking lot clients. Previously, expenses directly reimbursed under managed parking lot agreements were netted against the reimbursement received. EITF No. 01-14 did not change the income statement presentation of revenues and expenses of any other segments and had no impact on the Company’s operating profits or net income. Parking sales related solely to the reimbursement of expenses totaled $215.3 million, $203.8 million and $199.1 million for years ended October 31, 2003, 2002 and 2001, respectively.

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COMPARISON OF 2003 TO 2002 — CONTINUING OPERATIONS

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Years ended October 31							% of								% of				Increase
($ in thousands)			2003				Sales				2002				Sales				(Decrease)
Revenues
	Sales and other income		$	2,262,476				100.0	%		$	2,068,058				100.0	%			9.4	%
	Gain on insurance claim			—								10,025								—
				2,262,476								2,078,083								8.9	%
Expenses
	Operating expenses and cost of goods sold			2,035,731				90.0	%			1,855,980				89.7	%			9.7	%
	Selling, general and administrative			171,135				7.6	%			156,042				7.5	%			9.7	%
	Interest			758				0.0	%			1,052				0.1	%			(27.9	)%
				2,207,624				97.6	%			2,013,074				97.3	%			9.7	%
Income from continuing operations before income taxes				54,852				2.4	%			65,009				3.1	%			(15.6	)%
Income taxes				18,454				0.8	%			20,951				1.0	%			(11.9	)%
Income from continuing operations			$	36,398				1.6	%		$	44,058				2.1	%			(17.4	)%

      Income From Continuing Operations. Income from continuing operations in 2003 was $36.4 million ($0.73 per diluted share), a decrease of $7.7 million or 17.4% from $44.1 million ($0.86 per diluted share) in 2002. A number of items affected the comparability of the fiscal years. Fiscal 2002 results benefited from a $10.0 million pretax gain ($6.3 million after-tax, $0.12 per diluted share) from the receipt of two partial settlements totaling $13.3 million from the WTC insurance claim, and $2.0 million of income tax benefit ($0.04 per diluted share) from the adjustment of prior-year estimated tax liabilities, partially offset by $3.2 million of costs ($2.0 million after-tax, $0.04 per diluted share) associated with senior management changes. Fiscal 2003 results included $9.6 million ($6.0 million after-tax, $0.12 per diluted share) of higher operating profits contributed by acquisitions that did not significantly impact results until after July 31, 2002. However, the positive impact of the acquisitions on fiscal 2003 results was more than offset by declines in operating profits in 2003 from Janitorial, primarily in the Northeast and Northwest regions, as well as Lighting and Parking, see “Segment Information”.

      Sales. Sales in 2003 of $2,262.5 million increased by $194.4 million or 9.4% from $2,068.1 million in 2002. Acquisitions that did not significantly impact results until after July 31, 2002 contributed $182.0 million to the sales increase, primarily Lakeside acquired on July 12, 2002, the commercial self-performed janitorial cleaning operations of Horizon National Commercial Services (“Horizon”) acquired on January 31, 2003, Valet Parking Services (“Valet”) acquired on April 30, 2003, and HGO Services (“HGO”) acquired on August 29, 2003. The remainder of the increase was attributable to new business, partially offset by the impact of contract terminations and declines in sales due to increased vacancies and decreased project work and extra services as customers tightened their budgets.

      Operating Expenses and Cost of Goods Sold. As a percentage of sales, operating expenses and cost of goods sold were 90.0% for 2003, compared to 89.7% for 2002. Consequently, as a percentage of sales, the Company’s gross profit of 10.0% in 2003 was lower than the gross profit of 10.3% in 2002. The decline was due primarily to lower margins on new business, delays in planned terminations of unprofitable contracts in the Northeast region of Janitorial, a decline in sales from higher margin business due to increased vacancies in commercial office buildings, and higher reimbursements for out-of-pocket expenses from managed parking lot clients for which Parking had no margin benefit. Additionally, operating expenses for 2003 included higher insurance costs that could not be fully offset by price increases.

      Selling, General and Administrative Expenses. Selling, general and administrative expenses for 2003 were $171.1 million compared to $156.0 million for 2002. The $15.1 million increase included $12.6 million additional expenses contributed by acquisitions that did not impact results until after July 31, 2002, higher insurance costs, and annual salary increases. Additionally, corporate expenses in 2003 included higher directors and officers’ insurance costs and professional fees. However, 2002 also reflected a total of $7.0 million of charges including $3.2 million of costs associated with the elimination of the Chief Administrative Officer position, the early retirement of the former Corporate General Counsel, the replacement of the President of Facility Services, as well as $3.8 million higher bad debt provision in 2002 than in 2003. As a percentage of sales, selling, general and administrative expenses were 7.6% in 2003, compared to 7.5% in 2002.

      Interest Expense. Interest expense, which includes loan amortization and commitment fees for the revolving credit facility, was $0.8 million in 2003 compared to $1.1 million in 2002. The decrease was primarily due to lower borrowings and interest rates during 2003, compared to 2002.

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      Income Taxes. The effective federal and state income tax rate for income from continuing operations was 33.6% for 2003, compared to 32.2% for 2002. Income tax provision for continuing operations for 2002 included a tax benefit of $2.0 million principally from tax liability adjustments made after the filing of the 2001 income tax returns, while 2003 included $0.7 million of tax benefit from the filing of the 2002 state and federal tax returns and $0.2 million of income tax refund from filing prior years’ amended returns.

Segment Information

      Under SFAS No. 131 criteria, Janitorial, Parking, Engineering, Security, and Lighting are reportable segments. The operating results of the former Elevator segment are reported separately under discontinued operation and are excluded from the table below, see “Discontinued Operation.” All other services are included in the “Other” segment. Corporate expenses are not allocated.

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		Years ended October 31,								Increase
($ in thousands)		2003				2002				(Decrease)
Sales and other income:
Janitorial		$	1,368,282			$	1,197,035				14.3	%
Parking			380,576				363,511				4.7	%
Engineering			180,230				173,561				3.8	%
Security			159,670				140,569				13.6	%
Lighting			127,539				130,858				(2.5	)%
Other			45,394				61,963				(26.7	)%
Corporate			785				561				39.9	%
		$	2,262,476			$	2,068,058				9.4	%
Operating profit (loss):
Janitorial		$	53,487			$	54,337				(1.6	)%
Parking			6,349				6,948				(8.6	)%
Engineering			9,925				10,033				(1.1	)%
Security			6,485				5,639				15.0	%
Lighting			5,646				8,261				(31.7	)%
Other			1,337				(1,190	)			N/A
Corporate expense			(27,619	)			(27,992	)			(1.3	)%
Operating profit			55,610				56,036				(0.8	)%
Gain on insurance claim			—				10,025				N/A
Interest expense			(758	)			(1,052	)			(27.9	)%
Income from continuing operations before income taxes		$	54,852			$	65,009				(15.6	)%

      Janitorial. Sales for Janitorial were $171.2 million or 14.3% higher in 2003 than in 2002, primarily due to the $172.8 million contribution from Lakeside, Horizon and HGO. These gains in sales were substantially offset by the termination of unprofitable jobs in the Northeast and Southeast regions, the termination of a major contract due to collection issues in the Northwest region, and declines in sales from existing contracts due to increased vacancies and decreased extra services as customers tightened their budgets. In addition, sales for 2002 included $1.0 million of interest on receivables from the resolution of past-due balances with two customers.

      Operating profits in 2003 were $0.9 million or 1.6% lower than in 2002 primarily due to the $7.7 million and $2.5 million decline in operating profits in the Northeast and Northwest regions, respectively, which was partially offset by $8.8 million of operating profit improvement from Lakeside, Horizon and HGO.

      The decline in operating profits in the Northeast region of Janitorial, especially in New York City, was primarily due to new business priced at lower margins as a result of competitive pressures and a decline in sales from higher margin business due to increased vacancies. The benefit of terminating some unprofitable contracts has been offset by customer cancellations of some profitable service contracts. Further, first quarter 2002 results for New York City operations benefited from the extra clean-up work performed following the September 11th attacks. The region’s operating profits in 2003 were impacted by legal fees associated with a lawsuit related to the collection of a past-due accounts receivable from a large former customer and costs associated with implementing management changes in this region.

      The decline in operating profits in the Northwest region of Janitorial was due to the loss of a major contract, reduced revenues from existing contracts and higher legal fees primarily due to a gender discrimination lawsuit filed against ABM by a former employee in September 1999 in the State of Washington. ABM has not recorded any liability in its financial statements associated with the damages and costs awarded to the former employee. However, as of October 31, 2003, ABM has incurred and recorded legal fees of $0.1 million associated with the appeal. See Item 3, “Legal Proceedings.”

      Parking. Parking sales increased by $17.1 million or 4.7%, while operating profits decreased by $0.6 million or 8.6% during 2003 compared to 2002. The sales increase included $11.5 million of higher reimbursements for out-of-pocket expenses from managed parking lot clients for which Parking had no margin benefit, sales from the Valet acquisition, and the receipt of a $1.1 million settlement for prior period services performed related to a managed parking lot contract in Houston, Texas. These sales increases were partially offset by declines in sales from the hi-tech sectors of

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      Engineering. Engineering sales increased $6.7 million or 3.8% during 2003 compared to 2002 primarily due to new business, offset in part by a $7.0 million decline in sales from existing large customers that have reduced their spending. Operating profits decreased by $0.1 million or 1.1% from 2002 to 2003 primarily due to settlements of disputed amounts with two customers totaling $0.5 million, a settlement with a competing firm on a bid-related issue requiring payment while the customer contract is in force, and consulting costs associated with a study to assist Engineering to expand into new markets and broaden the scope of its services.

      Security. Security sales increased $19.1 million or 13.6% for 2003 compared to 2002 primarily due to an increase of $9.5 million in the sales contributed by the operations acquired from Triumph Security Corporation (“Triumph”) in New York City on January 26, 2002 and Foulke Associates, Inc. (“Foulke”), located throughout Georgia, Florida, Maryland, Pennsylvania and Virginia, on February 28, 2002. In addition, the award of a national contract from a Real Estate Investment Trust (“REIT”) added $8.4 million in sales for 2003. Operating profits increased by $0.8 million or 15.0% due to increased sales and tight control over operating expenses, partially offset by start-up costs incurred in 2003 related to the new contract with the REIT.

      Lighting. Lighting sales decreased $3.3 million or 2.5% and operating profits decreased $2.6 million or 31.7% during 2003 compared to 2002. The decrease in sales, particularly in the Northeast and North Central regions, was primarily due to significantly less retrofit projects in 2003 compared to 2002 and the termination of several national service contracts during 2003. Lighting’s customers, especially retailers, significantly reduced their capital budgets and spent less on energy saving initiatives in 2003. The decline in operating profits was primarily due to lower sales and higher selling, general and administrative expenses, partially offset by a $0.3 million gain recognized in the first quarter of 2003 related to the early termination of a contract. The Northeast and North Central regions hired additional managers in several branches and incurred higher labor-related costs due to training and management duplication during the transition.

      Other. Sales for the Other segment were down $16.6 million or 26.7% in 2003 compared to 2002. The lower sales in 2003 were primarily due to decreased capital project work as customers tightened their budgets and Facility Services’ loss of the Consolidated Freightways account due to bankruptcy in September 2002. The Other segment produced a profit of $1.3 million in 2003 compared to a loss of $1.2 million in 2002. Operating loss in 2002 included a $1.2 million write-down of work-in-progress in Mechanical, a $1.3 million bad debt provision in Facility Services for the Consolidated Freightways account, as well as $0.4 million in costs associated with the replacement of the President of Facility Services.

      Corporate. Corporate expenses for 2003 were down $0.4 million from 2002. However, 2002 included $2.8 million of costs associated with the elimination of the Chief Administrative Officer position and the early retirement of the former General Counsel. Corporate expenses for 2003 reflected a $1.1 million increase in premiums paid for directors and officers’ liability insurance (from $0.3 million in 2002 to $1.4 million in 2003), as well as higher professional fees related to the due diligence performed for a proposed acquisition that was not completed, Sarbanes-Oxley compliance, and additional use of outside legal counsel while in the process of recruiting a new General Counsel. The new General Counsel was hired on May 1, 2003.

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COMPARISON OF 2002 TO 2001 — CONTINUING OPERATIONS

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Years ended October 31							% of								% of				Increase
($ in thousands)			2002				Sales				2001				Sales				(Decrease)
Revenues
	Sales and other income		$	2,068,058				100.0	%		$	2,027,800				100.0	%			2.0	%
	Gain on insurance claim			10,025								—								—
				2,078,083								2,027,800								2.5	%
Expenses
	Operating expenses and cost of goods sold			1,855,980				89.7	%			1,820,081				89.8	%			2.0	%
	Selling, general and administrative			156,042				7.5	%			144,927				7.1	%			7.7	%
	Interest			1,052				0.1	%			2,600				0.1	%			(59.5)	%
	Goodwill amortization			—				—				12,065				0.6	%			—
				2,013,074				97.3	%			1,979,673				97.6	%			1.7	%
Income from continuing operations before income taxes				65,009				3.1	%			48,127				2.4	%			35.1	%
Income taxes				20,951				1.0	%			18,259				0.9	%			14.7	%
Income from continuing operations			$	44,058				2.1	%		$	29,868				1.5	%			47.5	%

      Income From Continuing Operations. Income from continuing operations for 2002 was $44.1 million ($0.86 per diluted share), an increase of 47.5% from the income from continuing operations of $29.9 million ($0.59 per diluted share) for 2001.

      The results for 2002 included a $10.0 million pretax gain from the receipt of two partial settlements from Zurich totaling $13.3 million related to the WTC; the impact of new acquisitions, primarily Lakeside in July 2002, which contributed $3.5 million of operating profit in 2002; a $2.0 million income tax benefit from the adjustment of prior year estimated tax liabilities; and a $1.4 million tax benefit from a lower income tax rate. The results for 2002 were adversely impacted by a $3.2 million pretax provision for costs associated with the elimination of the Chief Administrative Officer position, the early retirement of the former Corporate General Counsel and the replacement of the President of Facility Services; and a $3.2 million pretax increase in operating expenses in New York City as a result of the WTC related increase in seniority-based payroll and unemployment insurance costs at other job-sites in New York City. Additionally, the bad debt expense for 2002 was $5.0 million higher than 2001, primarily due to increased bankruptcies. Lastly, the business lost at the WTC had higher profit margins than those obtained on new business.

      Results for 2001 included a $20.0 million pretax insurance charge; $12.1 million of pretax goodwill amortization expense; and a pretax gain of $0.7 million from the divestiture of Easterday. Additionally, for the fiscal year ended October 31, 2001, the Company realized pretax income of $8.4 million on revenue of $71.0 million from the WTC and adjacent facilities.

      Sales. Sales for 2002 of $2,068.1 million increased by 2.0% compared to $2,027.8 million for 2001 despite the loss of the WTC and the sale of Easterday. Easterday contributed $16.0 million to sales for the first six months of 2001. Offsetting the absence of the WTC and Easterday sales in 2002 were sales from the newly acquired operations of Lakeside in the Midwest and other new business, primarily in Security. Sales generated from acquisitions during 2001 contributed $10.8 million of the 2002 increase, while 2002 acquisitions added $69.8 million. Also included in sales for 2002 was $1.0 million of interest income from the resolution of past due balances with two janitorial customers and $0.5 million of pretax gain from the early termination of a lease at Parking.

      Operating Expenses and Cost of Goods Sold. As a percentage of sales, operating expenses and cost of goods sold was 89.7% for 2002, compared to 89.8% for 2001. Consequently, as a percentage of sales, the Company’s gross profit of 10.3% in 2002 was higher than the gross profit of 10.2% in 2001. Operating expenses and cost of goods sold for fiscal 2002 included a $1.2 million pretax write-down of work-in-progress.

      Selling, General and Administrative Expenses. Selling, general and administrative expenses were $156.0 million in 2002, an increase of 7.7% from $144.9 million in 2001. The increase in selling, general and administrative expenses was primarily due to the $3.2 million costs associated with the above-mentioned personnel changes, $5.0 million of higher bad debt expense due to increased bankruptcies, and $1.0 million of professional expenses associated with the WTC insurance claim. Accordingly, as a percentage of sales, selling, general and administrative expenses increased to 7.5% in 2002 from 7.1% in 2001.

      Interest Expense. Interest expense was $1.1 million in 2002 compared to $2.6 million for 2001, a decrease of $1.5 million. This decrease was primarily due to lower weighted average borrowings and lower interest rates in 2002.

      Income Taxes. The effective tax rate for income from continuing operations for 2002 was 32.2%, compared to 37.9% for 2001. The decline was primarily due to a $2.0 million benefit from the adjustment of the prior year’s estimated tax liabilities

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Segment Information

      Under SFAS No. 131 criteria, all services other than Janitorial, Parking, Engineering, Security, and Lighting are included in the “Other” segment, including Easterday, prior to its sale on April 29, 2001. The operating results of the former Elevator segment are reported separately under discontinued operation and are excluded from the table below, see “Discontinued Operation.” Corporate expenses are not allocated. Goodwill amortization has been segregated from the operating profits of the segments for 2001 and reported separately to provide a comparable analysis.

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		Years ended October 31,								Increase
($ in thousands)		2002				2001				(Decrease)
Sales and other income:
Janitorial		$	1,197,035			$	1,159,914				3.2	%
Parking			363,511				365,073				(0.4	)%
Engineering			173,561				171,008				1.5	%
Security			140,569				103,980				35.2	%
Lighting			130,858				144,319				(9.3	)%
Other			61,963				82,188				(24.6	)%
Corporate			561				1,318				(57.4	)%
		$	2,068,058			$	2,027,800				2.0	%
Operating profit (loss):
Janitorial		$	54,337			$	67,590				(19.6	)%
Parking			6,948				6,619				5.0	%
Engineering			10,033				9,404				6.7	%
Security			5,639				3,174				77.7	%
Lighting			8,261				11,983				(31.1	)%
Other			(1,190	)			5,280				N/A
Corporate expense			(27,992	)			(41,258	)			(32.2	)%
Goodwill amortization			—				(12,065	)			N/A
Operating profit			56,036				50,727				10.5	%
Gain on insurance claim			10,025				—				N/A
Interest expense			(1,052	)			(2,600	)			(59.5	)%
Income from continuing operations before income taxes		$	65,009			$	48,127				35.1	%

      Janitorial. Janitorial reported sales for 2002 of $1,197.0 million, an increase of 3.2% from 2001. Sales included $1.0 million of interest on receivables from the resolution of past due balances with two customers. Janitorial accounted for nearly 58% of the Company’s consolidated sales in 2002. Janitorial sales increased primarily due to the impact of new acquisitions partially offset by the loss of the WTC. Sales generated from acquisitions during 2001 contributed $14.2 million of the 2002 increase, while the 2002 acquisitions added a total of $53.4 million, of which $51.6 million was contributed by Lakeside. Operating profits decreased 19.6% in 2002 to $54.3 million as compared to 2001 due to the loss of the WTC, and $3.2 million of pretax increase in operating expenses in New York City as a result of the WTC related increase in seniority-based payroll and unemployment insurance costs which could not be offset by price increases. Furthermore, bad debt expense increased to $6.3 million in 2002 compared to $2.1 million in 2001 due to increased bankruptcies.

      Parking. Parking sales decreased by 0.4% to $363.5 million in 2002, while its operating profits increased 5.0% to $6.9 million in 2002 compared to 2001. The decrease in sales was due to the loss of an airport contract and the continuing effects of the terrorist attacks of September 11, 2001 on sales at airport and hotel facilities, partially offset by sales from new parking contracts. The increase in operating profits resulted from higher margins on new parking contracts, discontinuation of unprofitable contracts and a $0.5 million gain on the early termination of a parking lease, which more than offset increased insurance costs that could not be fully offset by price increases.

      Engineering. Sales for Engineering increased 1.5% to $173.6 million in 2002 compared to 2001, due to an increased customer base in all regions and, in the second quarter of 2002, the resolution of disputed additional work performed for the Port Authority of New York. This was partially offset by the absence of the WTC contract. Operating profits increased 6.7% to $10.0 million from 2001 to 2002, due to increased business and improved profit margins.

      Security. Security sales increased 35.2% to $140.6 million due to the acquisitions of Sundown Security in June 2001, Triumph in January 2002, and Foulke in February 2002, as well as the addition of several large customer accounts. Sales generated by extra services were also higher due to heightened security concerns after the terrorist attacks on September 11, 2001. Operating profits increased 77.7% to $5.6 million in 2002 compared to fiscal year 2001 primarily due to increased sales and lower costs due to tighter control over labor and operating expenses.

      Lighting. Lighting reported a 9.3% decrease in sales to $130.9 million for 2002 compared to 2001, and a decrease in operating profits by 31.1% to $8.3 million in 2002. The decrease in sales and profits was primarily due to decreased business in the Southeast and Southwest regions, mostly related to non-recurring energy conservation projects in 2001, and the loss of sales and profits from the WTC.

      Other. Sales for the Other segment, which included Easterday prior to its sale on April 29, 2001, were down 24.6% to $62.0 million in 2002 compared

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      Corporate. Corporate expenses for 2002 included a $2.8 million pretax provision for costs associated with the elimination of the Chief Administrative Officer position and the early retirement of the former Corporate General Counsel, and $1.0 million of professional fees related to the WTC insurance claim. Included in 2001 was $20.0 million of pretax insurance charge to strengthen the Company’s self-insurance reserves, reflecting the results of the annual independent actuarial review completed in December 2001. While virtually all insurance claims arise from the operating segments, this adjustment is included in unallocated corporate expenses. Had the Company allocated the insurance charge among the segments, the reported pre-tax operating profits of the segments, as a whole, would have been reduced by $20.0 million, with an equal and offsetting change to unallocated corporate expenses and therefore no change to consolidated pre-tax earnings. Based on the annual actuarial review completed in November 2002, the self-insurance reserves as of the end of 2002 were deemed adequate.

Discontinued Operation

      On August 15, 2003, ABM completed the sale of substantially all of the operating assets of Amtech Elevator to Otis Elevator. The operating assets sold included customer contracts, accounts receivable, facility leases and other assets, as well as a perpetual license to the name “Amtech Elevator Services.” The consideration in connection with the sale included $112.4 million in cash and Otis Elevator’s assumption of trade payables and accrued liabilities. The Company realized a gain on the sale of $51.5 million, net of $31.9 million of income taxes. See Note 10 of Notes to Consolidated Financial Statements contained in Item 8, “Financial Statements and Supplementary Data.”

      The assets and liabilities of the Elevator segment have been segregated and classified as held for sale and the operating results and cash flows have been reported as discontinued operation in the accompanying consolidated financial statements. Income taxes have been allocated using the estimated combined federal and state tax rates applicable to Elevator for each of the periods presented. The prior periods presented have been reclassified.

      The operating results of the discontinued operation for fiscal 2003, 2002 and 2001 are shown below. Fiscal 2003 includes operating results for the period beginning November 1, 2002 through the date of sale, August 15, 2003.

(in thousands)		2003				2002				2001
Revenues		$	88,147			$	113,874			$	121,371
Income before income taxes			4,142				4,319				4,818
Income taxes			1,582				1,649				1,860
Net income		$	2,560			$	2,670			$	2,958

Recent Accounting Pronouncements

      In July 2002, FASB issued SFAS No. 146, “Accounting for Costs Associated with Exit or Disposal Activities.” SFAS No. 146 requires companies to recognize costs associated with exit or disposal activities when they are incurred rather than at the date of a commitment to an exit or disposal plan. Examples of costs covered by the standard include lease termination costs and certain employee severance costs that are associated with a restructuring, discontinued operation, or other exit or disposal activity. SFAS No. 146 replaces EITF Issue No. 94-3, “Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring).” SFAS No. 146 is effective for exit or disposal activities initiated after December 31, 2002. The adoption of SFAS No. 146 did not have a material effect on the consolidated financial statements of the Company.

      In November 2002, FASB issued Financial Interpretation No. (FIN) 45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others.”

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      In November 2002, the EITF issued a final consensus on EITF Issue No. 02-16, “Accounting by a Customer (Including a Reseller) for Certain Consideration Received from a Vendor.” EITF Issue No. 02-16 provides accounting guidance on how a customer (end-user) and a reseller should characterize certain consideration received from a vendor (such as a rebate) and when to recognize and how to measure that consideration in its income statement. EITF Issue No. 02-16 is effective for fiscal periods beginning after December 15, 2002 for resellers, with early application permitted, while for customers it is effective prospectively for arrangements entered into after November 21, 2002. The Company, as a reseller of certain supplies and equipment, has adopted the provisions of EITF Issue No. 02-16. The adoption had no material effect on the Company’s results of operations or financial condition.

      In January 2003, FASB issued FIN 46, “Consolidation of Variable Interest Entities,” an interpretation of Accounting Research Bulletin No. 51. FIN 46 addresses the consolidation by business enterprises of variable interest entities as defined in the interpretation. FIN 46 applied immediately to variable interests in variable interest entities created after January 31, 2003; and for the first fiscal year or interim period beginning after June 15, 2003 for variable interest entities in which an enterprise holds a variable interest that it acquired before February 1, 2003. Analysis of the Company’s interest in variable interest entities at October 31, 2003 indicates that no consolidation will be required. The application of FIN 46 had no material effect on the Company’s results of operations or financial condition.

      In May 2003, the EITF released Issue No. 00-21, “Accounting for Revenue Arrangements with Multiple Deliverables.” EITF Issue No. 00-21 provides accounting guidance on when and how an arrangement involving multiple deliverables should be divided into separate units of accounting. EITF Issue No. 00-21 is effective prospectively for arrangements entered into in fiscal periods beginning after June 15, 2003. The Company adopted the provisions of EITF Issue No. 00-21 effective in the fourth quarter of 2003. The Company’s Lighting segment earns revenues under service contracts that have multiple deliverables including initial services of relamping or retrofitting and future services of periodic maintenance. Lighting’s multiple deliverable contracts do not meet the criteria for treating the deliverables as separate units of accounting, hence the revenues and costs associated with the initial services are deferred and amortized over the service period on a straight-line basis. This is consistent with the revenue recognition methodology used by Lighting prior to the adoption of EITF Issue No. 00-21. Therefore, the adoption had no material effect on the Company’s results of operations or financial condition.

Critical Accounting Policies and Estimates

      The preparation of consolidated financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, sales and expenses. On an ongoing basis, the Company evaluates its estimates, including those related to self-insurance reserves, allowance for doubtful accounts, valuation allowance for the net deferred income tax asset, contingencies and litigation liabilities. The Company bases its estimates on historical experience, independent valuations and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

      The Company believes the following critical accounting policies affect its more significant judgments and estimates used in the preparation of its consolidated financial statements.

      Self-Insurance Reserves: Certain insurable risks such as general liability, automobile property damage and workers’ compensation are self-insured by the Company. However, the Company has umbrella insurance coverage for certain risk exposures subject to specified limits. Accruals for claims under the Company’s self-insurance program are recorded on a claim-incurred basis. The Company uses an independent actuarial firm to annually evaluate and estimate the range of the Company’s claim costs and liabilities. The Company accrues the minimum amount of the actuarial range of exposure. Using the annual actuarial report, management develops annual insur-

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      Allowance for Doubtful Accounts: The Company’s accounts receivable arise from services provided to its customers and are generally due and payable on terms varying from the receipt of invoice to net thirty days. The Company estimates an allowance for accounts it does not consider collectible. Changes in the financial condition of the customer or adverse development in negotiations or legal proceedings to obtain payment could result in the actual loss exceeding the estimated allowance.

      Deferred Income Tax Asset Valuation Allowance: Deferred income taxes reflect the impact of temporary differences between the amount of assets and liabilities recognized for financial reporting purposes and such amounts recognized for tax purposes. If management determines it is more likely than not that the net deferred tax asset will be realized, no valuation allowance is recorded. At October 31, 2003, the net deferred tax asset was $68.8 million and no valuation allowance was recorded. Should future income be less than anticipated, the net deferred tax asset may not be fully recoverable.

      Contingencies and Litigation: ABM and certain of its subsidiaries have been named defendants in certain litigations arising in the ordinary course of business including certain environmental matters. When a loss is probable and estimable the Company records the estimated loss. The actual loss may be greater than estimated, or litigation where the outcome was not considered probable might result in a loss.

Factors That May Affect Future Results

      The disclosure and analysis in this Annual Report on Form 10-K contain some forward-looking statements that set forth anticipated results based on management’s plans and assumptions. From time to time, the Company also provides forward-looking statements in other written materials released to the public as well as oral forward-looking statements. Such statements give the Company’s current expectations or forecasts of future events; they do not relate strictly to historical or current facts. Management tries, wherever possible, to identify such statements by using words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan, “project,” and similar expressions. In particular, these include statements relating to future actions, future performance or results of current and anticipated sales efforts, expenses, and the outcome of contingencies and other uncertainties, such as legal proceedings, and financial results.

      Achievement of future results is subject to risks, uncertainties and potentially inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from past results and those anticipated, estimated or projected. Investors should bear this in mind as they evaluate forward-looking statements.

      The Company undertakes no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. Investors are advised, however, to consult any future disclosures the Company makes on related subjects in its Form 10-Q and Form 8-K reports to the Securities and Exchange Commission. Set forth below are factors that the Company thinks, individually or in the aggregate, could cause the Company’s actual results to differ materially from past results or those anticipated, estimated or projected. The Company notes these factors for investors as permitted by the Private Securities Litigation Reform Act of 1995. The public should understand that it is not possible to predict or identify all such factors. Consequently, the following should not be considered to be a complete discussion of all potential risks or uncertainties.

      A further decline in commercial office building occupancy and rental rates could affect the Company’s sales and profitability. The Company’s sales directly depend on commercial real estate occupancy levels and the rental income of building owners. Decreases in these levels reduce demand and also create pricing pressures on building maintenance and other services provided by the Company. In certain geographic areas and service segments, the Company’s most profitable work includes jobs performed for tenants in buildings in which it performs building services for the property owner or management company. A decline in occupancy rates can result in a decline in fees paid by landlords as well as tenant work which will lower sales and

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      An increase in costs that the Company cannot pass on to customers could affect profitability. The Company attempts to negotiate contracts under which its customers agree to pay for increases in certain underlying costs associated with providing its services, particularly labor costs, workers’ compensation and other insurance costs, and any applicable payroll taxes. If the Company cannot pass through increases in its costs to its customers under its contracts in a timely manner or at all, then the Company’s expenses will increase without a corresponding increase in sales. Further, if the Company’s sales decline, the Company may not be able to reduce its expenses correspondingly or at all.

      The financial difficulties or bankruptcy of one or more of the Company’s major customers could adversely affect results. The Company’s ability to collect its accounts receivable and future sales depend, in part, on the financial strength of its customers. The Company estimates an allowance for accounts it does not consider collectible and this allowance adversely impacts profitability. In the event customers experience financial difficulty, and particularly if bankruptcy results, profitability is further impacted by the Company’s failure to collect accounts receivable in excess of the estimated allowance. Additionally, the Company’s future sales would be reduced.

      The Company could experience major collective bargaining disputes that would lead to the loss of sales or expense increases. Approximately 44% of the Company’s employees are subject to collective bargaining agreements at the local level. When one or more of the collective bargaining agreements are subject to renegotiation, the Company and the union may not agree on terms, which could result in a strike, work slow down or other job action at one or more of the Company’s locations, which could disrupt the Company in providing its service. Alternatively, the result of renegotiating a collective bargaining agreement could be a substantial increase in labor and benefits expenses that the Company could be unable to pass through to its customers for some period of time. In addition, the Company’s non-union competitors may attempt to use any disputes that the Company has with its unions to the competitors’ advantage in gaining market share.

      The Company is subject to intense competition. The Company believes that each aspect of its business is highly competitive, and that such competition is based primarily on price and quality of service. The Company provides nearly all its services under contracts originally obtained through competitive bidding. The low cost of entry to the facilities services business has led to strongly competitive markets made up of large numbers of mostly regional and local owner-operated companies, located in major cities throughout the United States and in British Columbia, Canada (with particularly intense competition in its janitorial business in the Southeast and South Central regions of the United States). The Company also competes with the operating divisions of a few large, diversified facility service and manufacturing companies on a national basis. Indirectly, the Company competes with building owners and tenants that perform internally one or more of the services provided by the Company. These building owners and tenants might have a competitive advantage when the Company’s services are subject to sales tax and internal operations are not. Furthermore, competitors may have lower costs because privately-owned companies operating in a limited geographic area may have significantly lower labor and overhead costs. These strong competitive pressures could inhibit the Company’s success in bidding for profitable business and its ability to increase prices even as costs rise, thereby reducing margins.

      The Company’s success depends on its ability to preserve its long-term relationships with its customers. The Company’s contracts with its customers are generally cancelable upon relatively short notice. However, the work associated with long-term relationships is generally more profitable than that from short-term relationships because the Company incurs initial costs with many new contracts, particularly for training, operating equipment and uniforms. Once these costs are expensed or fully depreciated over the appropriate periods, the underlying contracts become more profitable. Therefore, the Company’s loss of long-term customers could have an adverse impact on its profitability even if the Company generates equivalent sales from new customers.

      Weakness in airline travel and the hospitality industry could adversely impact the Company’s Parking results. A significant portion of the Company’s parking sales is tied to the numbers of

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      A continued slowdown in capital investments by customers could negatively impact the project sales of the Lighting and Mechanical segments. While the economy appears to be recovering in recent months, the commercial office building and retail sectors have been slow to make capital expenditures for lighting and mechanical projects. While we expect capital investment in these areas to increase in the coming year, customers’ capital projects budget could continue at low levels, which would adversely impact the Company’s results.

      Acquisition activity could slow or be unsuccessful. A significant portion of the Company’s historic growth has come through acquisitions. A slowdown in acquisitions could lead to a slower growth rate. Because new contracts frequently involve start-up costs, sales associated with acquired operations generally have higher margins than new sales associated with internal growth. Therefore a slowdown in acquisition activity could lead to higher costs as well as lower revenue growth. Because contracts in the Company’s businesses are generally short-term and personal relationships are significant in retaining customers, the Company relies on its ability to retain the managers of its acquired businesses. An inability to retain the services of the former owners and senior managers of acquired businesses could adversely affect the projected benefits of an acquisition. Moreover, the inability to successfully integrate acquisitions into the Company or to achieve the operational efficiencies anticipated in acquisitions could adversely impact sales and costs.

      The Company incurs significant accounting and other control costs, which could increase. As a publicly-traded corporation, the Company incurs certain additional costs to comply with regulatory requirements. Most of the Company’s competitors are privately-owned so these costs can be a competitive disadvantage for the Company. Should the Company’s sales decline, its costs associated with regulatory compliance will rise as a percentage of sales and under certain circumstances could increase in dollars as well.

      An inadequacy in the Company’s self-insurance reserves, or the cancellation or nonrenewal of the Company’s primary insurance policies, could adversely impact the Company’s results. The Company’s financial resources and its insurance coverage gives it a competitive advantage over smaller companies. Many customers, particularly institutional owners and large property management companies, prefer to do business with contractors who can provide substantial insurance coverage including, in the case of certain primary coverages, adequate self-insurance, and limits. Should the Company be unable to renew its umbrella and other commercial insurance policies at competitive rates, this loss would have an adverse impact on the Company’s business. While the size of the Company’s self-insurance reserves is determined by an actuarial analysis, an unanticipated increase in the frequency or severity of claims against the Company would have an adverse financial impact. In addition, catastrophic uninsured claims against the Company or the inability of the Company’s insurance carriers to pay otherwise insured claims would have an adverse financial impact.

      Other issues and uncertainties may include:

•	labor shortages that adversely affect the Company’s ability to employ entry level personnel
•	a reduction or revocation of the Company’s line of credit that could increase interest expense and the cost of capital
•	legislation or other governmental action that detrimentally impacts the Company’s expenses or reduces sales by adversely affecting the Company’s customers such as state or locally-mandated healthcare benefits
•	new accounting pronouncements or changes in accounting policies
•	impairment of goodwill
•	the resignation, termination, death or disability of one or more of the Company’s key executives that adversely affects customer retention or day-to-day management of the Company
•	inclement weather which could disrupt the Company in providing its services

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      The Company believes that it has the services, human and financial resources for business success, but future profit and cash flow can be adversely (or advantageously) influenced by a number of factors, including those discussed above, any and all of which are inherently difficult to forecast.

ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

       The Company does not issue or invest in financial instruments or their derivatives for trading or speculative purposes. The operations of the Company are conducted primarily in the United States, and, as such, are not subject to material foreign currency exchange rate risk. At October 31, 2003, the Company had no outstanding long-term debt. Although the Company’s assets included over $110.9 million in cash and cash equivalents at October 31, 2003, market rate risk associated with changing interest rates in the United States is not material.

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ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Independent Auditors’ Report

To the Stockholders and Board of Directors

      We have audited the accompanying consolidated balance sheets of ABM Industries Incorporated and subsidiaries as of October 31, 2003 and 2002, and the related consolidated statements of income, stockholders’ equity and comprehensive income, and cash flows for each of the years in the three-year period ended October 31, 2003. In connection with our audits of the consolidated financial statements, we also have audited the related financial statement Schedule II. These consolidated financial statements and the financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and the financial statement schedule based on our audits.

      We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

      In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of ABM Industries Incorporated and subsidiaries as of October 31, 2003 and 2002, and the results of their operations and their cash flows for each of the years in the three-year period ended October 31, 2003, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the related financial statement Schedule II, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/ KPMG LLP

San Francisco, California

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ABM Industries Incorporated and Subsidiaries

CONSOLIDATED BALANCE SHEETS

October 31				2003				2002
(in thousands, except share data)
Assets
Cash and cash equivalents				$	110,947			$	19,416
Trade accounts receivable (less allowances of $6,339 and $5,543)					287,906				296,634
Inventories					21,419				24,471
Deferred income taxes					36,339				30,002
Prepaid expenses and other current assets					44,037				39,501
Assets held for sale					—				32,136
		Total current assets			500,648				442,160
Investments and long-term receivables					11,459				14,952
Property, plant and equipment (less accumulated depreciation of $74,619 and $69,397)					30,123				35,846
Goodwill (less accumulated amortization of $69,386)					201,866				164,009
Deferred income taxes					32,462				33,542
Other assets					19,425				14,430
		Total assets		$	795,983			$	704,939
Liabilities
Trade accounts payable				$	38,143			$	48,995
Income taxes payable					36,658				6,579
Liabilities held for sale					—				7,403
Accrued liabilities:
	Compensation				61,691				60,595
	Taxes — other than income				15,297				13,525
	Insurance claims				55,499				50,969
	Other				49,403				39,024
		Total current liabilities			256,691				227,090
Retirement plans					24,175				23,791
Insurance claims					71,081				67,388
		Total liabilities			351,947				318,269
Stockholders’ equity
Preferred stock, $0.01 par value; 500,000 shares authorized; none issued					—				—
Common stock, $0.01 par value; 100,000,000 shares authorized; 51,767,000 and 50,397,000 shares issued at October 31, 2003 and 2002, respectively					518				504
Additional paid-in capital					166,497				151,135
Accumulated other comprehensive loss					(268	)			(789	)
Retained earnings					331,275				259,452
Cost of treasury stock (3,400,000 and 1,400,000 shares at October 31, 2003 and October 31, 2002, respectively)					(53,986	)			(23,632	)
		Total stockholders’ equity			444,036				386,670
		Total liabilities and stockholders’ equity		$	795,983			$	704,939

The accompanying notes are an integral part of the consolidated financial statements.

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ABM Industries Incorporated and Subsidiaries

CONSOLIDATED STATEMENTS OF INCOME

Years ended October 31			2003				2002				2001
(in thousands, except per share data)
Revenues
	Sales and other income		$	2,262,476			$	2,068,058			$	2,027,800
	Gain on insurance claim			—				10,025				—
				2,262,476				2,078,083				2,027,800
Expenses
	Operating expenses and cost of goods sold			2,035,731				1,855,980				1,820,081
	Selling, general and administrative			171,135				156,042				144,927
	Interest			758				1,052				2,600
	Goodwill amortization			—				—				12,065
				2,207,624				2,013,074				1,979,673
Income from continuing operations before income taxes				54,852				65,009				48,127
Income taxes				18,454				20,951				18,259
Income from continuing operations				36,398				44,058				29,868
Income from discontinued operation, net of income taxes				2,560				2,670				2,958
Gain on sale of discontinued operation, net of income taxes				51,500				—				—
Net income			$	90,458			$	46,728			$	32,826
Net income per common share — Basic
	Income from continuing operations		$	0.74			$	0.90			$	0.62
	Income from discontinued operation			0.05				0.05				0.06
	Gain on sale of discontinued operation			1.05				—				—
			$	1.84			$	0.95			$	0.68
Net income per common share — Diluted
	Income from continuing operations		$	0.73			$	0.86			$	0.59
	Income from discontinued operation			0.05				0.06				0.06
	Gain on sale of discontinued operation			1.03				—				—
			$	1.81			$	0.92			$	0.65
Average common and common equivalent shares
	Basic			49,065				49,116				47,598
	Diluted			50,004				51,015				50,020

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ABM Industries Incorporated and Subsidiaries

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND COMPREHENSIVE INCOME

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																								Accumulated
Years ended October 31, 2003, 2002				Common Stock								Treasury Stock								Additional				Other
and 2001																				Paid-in				Comprehensive				Retained
(in thousands)				Shares				Amount				Shares				Amount				Capital				Income (Loss)				Earnings				Total
Balance October 31, 2000					45,998			$	460				—			$	—			$	102,672			$	(653	)		$	213,830			$	316,309
	Comprehensive income:
		Net income																											32,826				32,826
		Foreign currency translation																							(110	)							(110	)
		Comprehensive income																															32,716
	Dividends:
		Common stock																											(15,770	)			(15,770	)
		Preferred stock																											(432	)			(432	)
	Tax benefit from exercise of stock options																				3,651												3,651
	Stock issued under employees’ stock purchase and option plans and for acquisition				2,780				28												24,675												24,703
Balance October 31, 2001					48,778			$	488				—			$	—			$	130,998			$	(763	)		$	230,454			$	361,177
	Comprehensive income:
		Net income																											46,728				46,728
		Foreign currency translation																							(26	)							(26	)
		Comprehensive income																															46,702
	Dividends:
		Common stock																											(17,730	)			(17,730	)
	Tax benefit from exercise of stock options																				1,384												1,384
	Stock purchases												(1,400)				(23,632	)															(23,632	)
	Stock issued under employees’ stock purchase and option plans and for acquisition				1,619				16												18,753												18,769
Balance October 31, 2002					50,397			$	504				(1,400)			$	(23,632	)		$	151,135			$	(789	)		$	259,452			$	386,670
	Comprehensive income:
		Net income																											90,458				90,458
		Foreign currency translation																							521								521
		Comprehensive income																															90,979
	Dividends:
		Common stock																											(18,635	)			(18,635	)
	Tax benefit from exercise of stock options																				1,052												1,052
	Stock purchases												(2,000)				(30,354	)															(30,354	)
	Stock issued under employees’ stock purchase and option plans				1,370				14												14,310												14,324
Balance October 31, 2003					51,767			$	518				(3,400)			$	(53,986	)		$	166,497			$	(268	)		$	331,275			$	444,036

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ABM Industries Incorporated and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

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Years ended October 31		2003				2002				2001
(in thousands)
Cash flows from operating activities:
Net income		$	90,458			$	46,728			$	32,826
Less income from discontinued operation			(54,060	)			(2,670	)			(2,958	)
Income from continuing operations			36,398				44,058				29,868
Adjustments to reconcile income from continuing operations to net cash provided by continuing operating activities:
Depreciation and intangible amortization			14,829				14,955				13,823
Goodwill amortization			—				—				12,065
Provision for bad debts			6,544				10,381				5,389
Gain on sale of assets			(66	)			(236	)			(41	)
Gain on sale of business			—				—				(718	)
Increase in deferred income taxes			(5,257	)			(1,338	)			(12,138	)
Decrease (increase) in trade accounts receivable			2,225				30,782				(20,500	)
Decrease (increase) in inventories			3,081				(4,214	)			(2,379	)
(Increase) decrease in prepaid expenses and other current assets			(3,105	)			3,073				(3,023	)
(Increase) decrease in other assets			(5,940	)			(3,445	)			48
(Decrease) increase in income taxes payable			(769	)			590				(1,267	)
Increase (decrease) in retirement plans accrual			384				2,308				(903	)
Increase in insurance claims liability			8,223				6,665				18,872
(Decrease) increase in trade accounts payable and other accrued liabilities			(2,827	)			(3,559	)			26,973
Total adjustments to net income			17,322				55,962				36,201
Net cash flows from continuing operating activities			53,720				100,020				66,069
Net operational cash flows from discontinued operation			6,422				10,899				(273	)
Net cash provided by operating activities		$	60,142			$	110,919			$	65,796
Cash flows from investing activities:
Net investing cash flows from discontinued operation			(95	)			(136	)			(174	)
Additions to property, plant and equipment			(11,621	)			(7,345	)			(16,667	)
Proceeds from sale of assets			2,451				1,692				1,172
Decrease (increase) in investments and long-term receivables			3,493				(1,081	)			49
Purchase of businesses			(40,574	)			(52,448	)			(23,401	)
Proceeds from sale of business			112,400				—				12,000
Net cash provided by (used in) investing activities			66,054				(59,318	)			(27,021	)
Cash flows from financing activities:
Common stock issued			14,324				17,955				26,688
Common stock purchases			(30,354	)			(23,632	)			—
Preferred stock redemption			—				—				(6,400	)
Dividends paid			(18,635	)			(17,730	)			(16,202	)
Decrease in bank overdraft			—				—				(15,952	)
Long-term borrowings			—				—				108,000
Repayments of long-term borrowings			—				(11,819	)			(133,857	)
Net cash used in financing activities			(34,665	)			(35,226	)			(37,723	)
Net increase in cash and cash equivalents			91,531				16,375				1,052
Cash and cash equivalents beginning of year			19,416				3,041				1,989
Cash and cash equivalents end of year		$	110,947			$	19,416			$	3,041
Supplemental Data:
Cash paid for income taxes		$	24,570			$	21,699			$	31,664
Non-cash investing activities:
Common stock issued for net assets of business acquired		$	—			$	1,371			$	1,666

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1.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Principles of Consolidation: The consolidated financial statements include the accounts of ABM Industries Incorporated and its subsidiaries (the Company). All material intercompany transactions and balances have been eliminated.

      Use of Estimates: The preparation of consolidated financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, sales and expenses. On an ongoing basis, the Company evaluates its estimates, including those related to self-insurance reserves, allowance for doubtful accounts, valuation allowance for the net deferred income tax asset, contingencies and litigation liabilities. The Company bases its estimates on historical experience, independent valuations, and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

      Reclassifications: The operations of the Company’s Elevator segment have been classified as a discontinued operation for all periods presented. Accordingly, the assets and liabilities of the elevator segment have been segregated and classified as held for sale and the operating results and cash flows are shown as discontinued operation in the accompanying consolidated financial statements. See Note 10.

      Trade Accounts Receivable: The Company’s accounts receivable arise from services provided to its customers and are generally due and payable on terms varying from the receipt of invoice to net thirty days. The Company does not believe that it has any material exposure due to either industry or regional concentrations of credit risk.

      Inventories: Inventories are service related supplies and are valued at amounts approximating the lower of cost (first-in, first-out basis) or market. The cost of inventories is net of vendor rebates. Rebates are accounted for in accordance with Emerging Issues Task Force (EITF) Issue No. 02-16, “Accounting by a Customer (Including a Reseller) for Certain Consideration Received from a Vendor,” which was issued in November 2002. EITF Issue No. 02-16 provides accounting guidance on how a customer (end user) and a reseller should characterize certain consideration received from a vendor and when to recognize and how to measure that consideration in its income statement. EITF Issue No. 02-16 is effective for fiscal periods beginning after December 15, 2002 for resellers, with early application permitted, while for customers it is effective prospectively for arrangements entered into after November 21, 2002. The Company, as a reseller of certain supplies and equipment, has adopted the provisions of EITF Issue No. 02-16. The adoption had no material effect on the Company’s results of operations or financial condition.

      Property, Plant and Equipment: Property, plant and equipment are stated at cost less accumulated depreciation and amortization. At the time property, plant and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in income. Maintenance and repairs are charged against income as incurred.

      Depreciation and amortization are calculated using the straight-line method. Useful lives used in computing depreciation for transportation equipment average 3 to 5 years and for machinery and other equipment average 2 to 20 years. Buildings are depreciated over periods of 20 to 40 years. Leasehold improvements are amortized over the shorter of the terms of the respective leases, or the assets’ useful lives.

      Goodwill and Other Intangibles: In July 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 142, “Goodwill and Other Intangible Assets.” SFAS No. 142 became effective in fiscal years beginning after December 15, 2001, with early adoption permitted. The Company adopted the provisions of SFAS No. 142 beginning with the first quarter of fiscal 2002. In accordance with this standard, goodwill is no longer amortized but is subject to at least an annual assessment for impairment. The Company is required to perform goodwill impairment tests on an annual basis using the two-step process prescribed in SFAS No. 142. The first step is a screen for potential impairment comparing the

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      The changes in the carrying amount of goodwill for the year ended October 31, 2003 are as follows (acquisitions are discussed in Note 9):

		Balance				Initial								Balance
		as of				Payments								as of
		October 31,				for				Contingent				October 31,
(in thousands)		2002				Acquisitions				Amounts				2003
Janitorial		$	108,698			$	25,273			$	8,687			$	142,658
Parking			27,271				1,657				992				29,920
Engineering			2,174				—				—				2,174
Security			7,213				—				593				7,806
Lighting			16,701				—				655				17,356
Other			1,952				—				—				1,952
Total		$	164,009			$	26,930			$	10,927			$	201,866

      Transitional disclosure of earnings excluding goodwill amortization is as follows:

Years ended October 31			2003				2002				2001
(in thousands, except per share data)
Income from continuing operations, net of income taxes			$	36,398			$	44,058			$	29,868
Income from discontinued operation, net of income taxes				2,560				2,670				2,958
Gain on sale of discontinued operation, net of income taxes				51,500				—				—
Goodwill amortization from continuing operations, net of income taxes				—				—				7,481
Goodwill amortization from discontinued operation, net of income taxes				—				—				118
Adjusted net income				90,458				46,728				40,425
Preferred stock dividends				—				—				(432	)
Adjusted net income available to common stockholders			$	90,458			$	46,728			$	39,993
Net income per common share — Basic:
	Income from continuing operations		$	0.74			$	0.90			$	0.62
	Income from discontinued operation			0.05				0.05				0.06
	Gain on sale of discontinued operation			1.05				—				—
	Goodwill amortization from continuing operations			—				—				0.16
	Goodwill amortization from discontinued operation			—				—				—
Adjusted net income per common share — Basic			$	1.84			$	0.95			$	0.84
Net income per common share — Diluted:
	Income from continuing operations		$	0.73			$	0.86			$	0.59
	Income from discontinued operation			0.05				0.06				0.06
	Gain on sale of discontinued operation			1.03				—				—
	Goodwill amortization from continuing operations			—				—				0.15
	Goodwill amortization from discontinued operation			—				—				—
Adjusted net income per common share — Diluted			$	1.81			$	0.92			$	0.80
Average common shares outstanding
	Basic			49,065				49,116				47,598
	Diluted			50,004				51,015				50,020

      As of October 31, 2003 and 2002, all intangible assets other than goodwill, consisting principally of contract rights with a net book value of $3.7 million and $4.1 million, respectively, were included in other assets and are being amortized over the contract periods. Amortization expense for intangible assets other than goodwill was $1.1 million, $1.1 million, and $0.4 million for the years ended October 31, 2003, 2002 and 2001, respectively. The remaining amortiza-

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      Income Taxes: Income tax expense is based on reported results of operations before income taxes. Deferred income taxes reflect the impact of temporary differences between the amount of assets and liabilities recognized for financial reporting purposes and such amounts recognized for tax purposes. These deferred taxes are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

      Revenue Recognition: The Company earns revenue primarily under service contracts that are either fixed price or are time and materials based. In both contract types, revenue is recognized as the services are performed. Under the fixed price contacts, with the exception of Lighting’s multiple deliverable contracts, there are no up-front fee arrangements or acceptance requirements that would require deferral of revenue recognition under Staff Accounting Bulletin No. 101.

      In May 2003, the EITF released Issue No. 00-21, “Accounting for Revenue Arrangements with Multiple Deliverables.” EITF Issue No. 00-21 provides accounting guidance on when and how an arrangement involving multiple deliverables should be divided into separate units of accounting. EITF Issue No. 00-21 is effective prospectively for arrangements entered into in fiscal periods beginning after June 15, 2003. The Company has adopted the provisions of EITF Issue No. 00-21 effective in the fourth quarter of 2003. The Company’s Lighting segment earns revenues under service contracts that have multiple deliverables including initial services of relamping or retrofitting and future services of periodic maintenance. Lighting’s multiple deliverable contracts do not meet the criteria for treating the deliverables as separate units of accounting, hence the revenues and direct costs associated with the initial services are deferred and amortized over the service period on a straight-line basis. This is consistent with the revenue recognition methodology used by Lighting prior to the adoption of EITF Issue No. 00-21. Therefore, the adoption had no material effect on the Company’s results of operations or financial condition.

      In January 2002, the EITF released Issue No. 01-14, “Income Statement Characterization of Reimbursements Received for Out-of-Pocket Expenses Incurred,” which the Company adopted in fiscal 2002. For the Company’s Parking segment this pronouncement requires both revenues and expenses be recognized, in equal amounts, for costs directly reimbursed from its managed parking lot clients. Previously, expenses directly reimbursed under managed parking lot agreements were netted against the reimbursement received. EITF No. 01-14 did not change the income statement presentation of revenues and expenses of any other segments and had no impact on the Company’s operating profits or net income. Parking sales related solely to the reimbursement of expenses totaled $215.3 million, $203.8 million and $199.1 million for years ended October 31, 2003, 2002 and 2001, respectively.

      Net Income per Common Share: The Company has reported its earnings in accordance with SFAS No. 128, “Earnings per Share.” Basic net income per common share, after the reduction for preferred stock dividends, is based on the weighted average number of shares outstanding during the period. Diluted net income per common share, after the reduction for preferred stock dividends, is based on the weighted average number of shares outstanding during the period, including common stock equivalents. Preferred stock dividends no longer apply after the redemption of preferred stock on September 4, 2001.

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Years ended October 31			2003				2002				2001
(in thousands, except per share data)
Income from continuing operations, net of income taxes			$	36,398			$	44,058			$	29,868
Income from discontinued operation, net of income taxes				2,560				2,670				2,958
Gain on sale of discontinued operation, net of income taxes				51,500				—				—
Net income				90,458				46,728				32,826
Preferred stock dividends				—				—				(432	)
Net income available to common stockholders			$	90,458			$	46,728			$	32,394
Average common shares outstanding — Basic				49,065				49,116				47,598
Effect of dilutive securities:
	Stock options			939				1,899				2,300
	Other			—				—				122
Average common shares outstanding — Diluted				50,004				51,015				50,020
Net income per common share — Basic:
	Income from continuing operations		$	0.74			$	0.90			$	0.62
	Income from discontinued operation			0.05				0.05				0.06
	Gain on sale of discontinued operation			1.05				—				—
			$	1.84			$	0.95			$	0.68
Net income per common share — Diluted:
	Income from continuing operations		$	0.73			$	0.86			$	0.59
	Income from discontinued operation			0.05				0.06				0.06
	Gain on sale of discontinued operation			1.03				—				—
			$	1.81			$	0.92			$	0.65

      For purposes of computing diluted net income per common share, weighted average common share equivalents do not include stock options with an exercise price that exceeds the average fair market value of the Company’s common stock for the period (i.e., “out-of-the-money” options). On October 31, 2003, 2002 and 2001, options to purchase common shares of 2.8 million, 3.1 million, and 1.7 million at weighted average exercise prices of $16.26, $16.29 and $16.31, respectively, were excluded from the computation.

      Cash and Cash Equivalents: The Company considers all highly liquid instruments with original maturities of three months or less to be cash and cash equivalents.

      Stock-Based Compensation: In December 2002, FASB issued SFAS  No. 148, “Accounting for Stock-Based Compensation — Transition and Disclosure.” SFAS No. 148 amended SFAS No. 123, “Accounting for Stock-Based Compensation” to provide for alternative methods of transition to SFAS No. 123 and amended disclosure provisions. SFAS No. 148 is effective for financial statements for fiscal years ending after December 15, 2002. The Company continues to account for stock-based employee compensation plans using the intrinsic value method under the recognition and measurement principles of Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees,” and has adopted the disclosure provisions of SFAS No. 148 effective November 1, 2002. The Company’s application of APB Opinion No. 25 does not result in compensation cost because the exercise price of the options is equal to the fair value of the stock at the grant date. Under the intrinsic value method, if the fair value of the stock is greater than the exercise price at grant date, the excess is amortized to compensation expense over the estimated service life of the recipient.

      As all options granted since October 31, 1995 had an exercise price equal to the market value of the underlying common stock on the date of grant, no stock-based employee compensation cost is reflected in net income for the years ended October 31, 2003, 2002 and 2001. The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value recognition provisions of SFAS No. 123 to all employee options granted after October 31, 1995 using the retroactive restatement method:

Years ended October 31			2003				2002				2001
(in thousands, except per share data)
Net income, as reported			$	90,458			$	46,728			$	32,826
Deduct: Stock-based employee compensation cost, net of tax effect, that would have been included in net income if the fair value method had been applied				3,591				3,941				3,724
Net income, pro forma			$	86,867			$	42,787			$	29,102
Net income per common share — Basic
	As reported		$	1.84			$	0.95			$	0.68
	Pro forma		$	1.77			$	0.87			$	0.60
Net income per common share — Diluted
	As reported		$	1.81			$	0.92			$	0.65
	Pro forma		$	1.74			$	0.84			$	0.57

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     The fair value of stock-based awards to employees is calculated through the use of option pricing models. The use of these models requires subjective assumptions, including future stock price volatility and expected time to exercise, which can have a significant effect on the calculated values. The Company’s calculations for fiscal 2003, 2002 and 2001 were made using the Black-Scholes option pricing model with the following weighted average assumptions: expected life from the date of grant of 7.4 years, 9.7 years and 9.2 years, respectively; expected stock price volatility of 23.0%, 32.5% and 28.1%, respectively; expected dividend yields of 2.6%, 2.2% and 2.2%, respectively; and risk free interest rates of 3.3%, 4.4% and 5.3%, respectively.

      The Company’s calculations are based on a single option valuation approach. The computed fair value of the options awards are amortized over the required vesting periods. The vesting period for the Price-Vested options is initially estimated at eight years. Should the early vesting trigger occur, the remaining unrecognized value of the Price-Vested option is recognized immediately. Stock option forfeitures are recognized as they occur.

      Comprehensive Income: Comprehensive income consists of net income and other related gains and losses affecting stockholders’ equity that, under generally accepted accounting principles, are excluded from net income. For the Company, such other comprehensive income items consist of unrealized foreign currency translation gains and losses.

2. INSURANCE

      The Company self-insures certain insurable risks such as general liability, automobile property damage and workers’ compensation. Commercial umbrella policies are obtained to provide for $150.0 million of coverage above the self-insured retention limits (i.e., deductible). As of November 1, 2002, substantially all of the self-insured retentions increased from $0.5 million to $1.0 million. Effective April 14, 2003, the deductible for California workers’ compensation insurance increased to $2.0 million per occurrence due to general insurance market conditions. While the higher self-insured retention increases the Company’s risk associated with workers’ compensation liabilities, during the history of the Company’s self-insurance program, few claims have exceeded $1.0 million. Despite the higher retention, the price of the 2003 umbrella policies is significantly higher than 2002 and this higher price has been factored into the self-insurance rates charged by the Company to its operations in 2003.

      The Company uses independent actuaries to annually evaluate and record the Company’s estimated claim costs and liabilities and accrues an amount that is within an actuarial range of exposure. The estimated liability for claims incurred but unpaid at October 31, 2003 and 2002 was $126.6 million and $118.4 million, respectively. Based on the annual actuarial review completed in October 2003, the self-insurance reserves as of the end of fiscal year 2003 were deemed adequate.

      In the fourth quarter of fiscal year 2001, the Company recorded a $20.0 million pre-tax expense to strengthen reserves as a result of the actuarial evaluation. The 2001 actuarial report revealed that while the frequency of claims was trending favorably as expected, the severity of claims in 2000 and 2001 trended higher than anticipated in the report received in 2000. The impact of these trends on known claims and on claims incurred but not reported called for an increase of approximately $8.5 million for fiscal 2001 claims while approximately $10.5 million reflected 2001’s unfavorable trend on pre-2001 claims. Additionally, 2001 required a provision of $1.0 million for claims related to the September 11, 2001 World Trade Center (WTC) attack.

      In connection with certain self-insurance agreements, the Company has standby letters of credit at October 31, 2003 and 2002 supporting the estimated unpaid liability in the amount of $67.6 million and $100.3 million, respectively. As of October 31, 2003, the Company participated in the State of California’s Self-Insurers’ Security Fund in lieu of using standby letters of credit.

3. PROPERTY, PLANT AND EQUIPMENT

      Property, plant and equipment at October 31 consisted of the following:

(in thousands)		2003				2002
Land		$	876			$	876
Buildings			4,133				4,238
Transportation equipment			13,717				14,245
Machinery and other equipment			71,846				71,548
Leasehold improvements			14,170				14,336
			104,742				105,243
Less accumulated depreciation and amortization			74,619				69,397
		$	30,123			$	35,846

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4. LONG-TERM DEBT AND CREDIT AGREEMENT

      In April 2003, the Company increased the amount of its syndicated line of credit, which will expire July 1, 2005, to $250.0 million. As amended, no compensating balances are required under the facility and the interest rate is determined at the time of borrowing based on the London Interbank Offered Rate (LIBOR) plus a spread of 0.875% to 1.50% or, for overnight borrowings, at the prime rate plus a spread of 0.00% to 0.25% or, for overnight to one week, at the Interbank Offered Rate (IBOR) plus a spread of 0.875% to 1.50%. The spread for LIBOR, prime and IBOR borrowings is based on the Company’s leverage ratio. The facility calls for a commitment fee payable quarterly, in arrears, of 0.20%, as amended, based on the average, daily, unused portion. For purposes of this calculation, irrevocable standby letters of credit issued primarily in conjunction with the Company’s self-insurance program plus cash borrowings are considered to be outstanding amounts. As of October 31, 2003 and 2002, the total outstanding amounts under this facility were $69.0 million and $102.0 million, respectively, in the form of standby letters of credit. The decrease is due to the reduction of the use of standby letters of credit for certain self-insurance agreements, specifically in the State of California where the Company now participates in the state’s Self-Insurers’ Security Fund in lieu of standby letters of credit. The provisions of the credit facility require the Company to maintain certain financial ratios and limit outside borrowings. The Company was in compliance with all covenants as of October 31, 2003. The Company’s effective weighted average interest rate (excluding amortization of related fees) for all LIBOR, prime and IBOR borrowings for the year ended October 31, 2003 was 2.60%.

5. EMPLOYEE BENEFIT PLANS

      The Company offers the following employee benefit plans to its employees.

(a) 401(k) Plan

      The Company has a 401(k) plan covering certain qualified employees, which includes employer participation in accordance with the provisions of Section 401(k) of the Internal Revenue Code. The plan allows participants to make pretax contributions and the Company matches a certain percentage of employee contributions depending on the participant’s amount of contributions. Effective January 1, 2002, the Company amended its plan to adopt the “safe harbor” rules of 401(k) plans. These rules contain more generous company match provisions and cover many employees not previously included. Therefore, since January 2002, the Company has been incurring additional costs. All amounts contributed to the plan are deposited into a trust fund administered by independent trustees.

      The Company’s matching 401(k) contributions required by the 401(k) plan for 2003, 2002 and 2001 were $5.2 million, $4.2 million and $1.5 million, respectively.

(b) Retirement Agreements

      The Company has unfunded retirement agreements for approximately 55 current and former directors and senior executives, many of which are fully vested. The retirement agreements for senior executives provide for monthly benefits for ten years commencing at the later of the respective retirement dates of those executives or age 65. The benefits are accrued over required vesting periods. During 2003, 2002 and 2001, amounts accrued under these agreements were $0.4 million, $0.5 million and $0.5 million, respectively. Payments were made in 2003, 2002 and 2001 in the amounts of $0.4 million, $0.4 million and $0.2 million, respectively. As of October 31, 2003, the present value of estimated future payments under these agreements was $3.9 million.

      Non-employee directors who have completed at least five years of service are eligible to receive ten years of monthly retirement benefits equal to the monthly retainer fee received prior to retirement, reduced on a pro-rata basis for fewer than ten years of service. Benefit payments commence at the later of the respective retirement dates of those directors or age 62 (early retirement) or 72 (senior retirement) and ends at the earlier of the 121st month after retirement or the death of the director. Non-employee directors who retire after the age of 70 have the option to receive a lump sum payment equal to the present value of the monthly payments discounted at 8.0%. The benefits are accrued over required vesting periods. During 2003, 2002 and 2001, amounts accrued under this agreement were $0.4 million, $0.1 million and $0.1 million, respectively. Payments made in 2003 were $0.2 million and less than $0.1 million of payments were made in each of the fiscal years 2002 and 2001. As of October 31, 2003, the present value of estimated future payments under these agreements was $1.2 million.

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(c) Service Award Benefit Plan

      The Company has an unfunded service award benefit plan, with a retroactive vesting period of five years. This plan is a “severance pay plan” as defined by the Employee Retirement Income Security Act (ERISA) and covers certain qualified employees. The plan provides participants, upon termination, with a guaranteed seven days pay for each year of employment subsequent to November 1, 1989. The Company, at its discretion, may also award additional days each year.

      Effective January 1, 2002, this plan was amended to no longer award any further days to employees. The enhancement of the 401(k) plan has replaced benefits previously provided under this plan. The Company will continue to incur interest costs related to this plan as the value of previously earned benefits continues to increase.

      Net cost of the plan is comprised of:

(in thousands)			2003				2002				2001
Service cost			$	—			$	184			$	427
Interest				317				350				358
Net cost			$	317			$	534			$	785
Actuarial present value of:
	Vested benefit obligation		$	4,409			$	4,571			$	4,479
	Accumulated benefit obligation		$	4,433			$	4,664			$	4,662
	Projected benefit obligation		$	4,792			$	5,153			$	5,342

      The 2003 actuarial present values reflect the payout of 24 plan participants who were employees of Amtech Elevator Services, Inc. and were terminated on August 15, 2003. See Note 10.

      Assumptions used in accounting for the plan as of October 31 were:

		2003				2002				2001
Weighted average discount rate			6.25	%			6.75	%			7.50	%
Rate of increase in compensation level			3.0	%			3.0	%			5.0	%

      The liability recorded by the Company is equal to the accumulated benefit obligation shown above.

(d) Death Benefit Plan

      The Company has an unfunded post-retirement death benefit plan with a vesting period of ten years. This plan covers certain qualified employees and, upon retirement on or after the employee’s 62nd birthday, provides fifty percent of the death benefit that the employee was entitled to prior to retirement subject to a maximum of $150,000. Coverage during retirement continues until death for retired employees hired before September 1, 1980. On March 1, 2003, the post-retirement death benefit for any active employees hired after September 1, 1980 was eliminated. For employees hired after September 1, 1980 and retired before March 1, 2003, the post-retirement death benefit continues until the retired employees 70th birthday.

      At October 31, 2003 and 2002, the actuarial present values of the accumulated post-retirement benefit obligation were $4.4 million and $5.1 million, respectively. The accumulated post-retirement benefit obligation was calculated using the assumed rates of 6.25% and 6.75% weighted average discount rate as of October 31, 2003 and 2002 and 3% increase in compensation level for both years. The Company recorded liabilities of $4.2 million and $3.8 million, at October 31, 2003 and 2002, respectively, for its obligations under the plan.

      The decline in the actuarial present value in 2003 was primarily due to the elimination of the benefit for employees hired after September 1, 1980 and the termination of the employees of Amtech Elevator Services, Inc. upon the sale of its operating assets to Otis Elevator Company (Otis Elevator) on August 15, 2003. See Note 10.

(e) Pension Plan Under Collective Bargaining

      Certain qualified employees of the Company are covered under union-sponsored collectively bargained multi-employer defined benefit plans. Contributions for these plans were approximately $29.2 million, $26.7 million and $27.4 million in 2003, 2002 and 2001, respectively. These plans are not administered by the Company and contributions are determined in accordance with provisions of negotiated labor contracts.

6. LEASE COMMITMENTS AND RENTAL EXPENSE

      The Company is contractually obligated to make future payments under noncancelable operating lease agreements for various facilities, vehicles and other equipment. As of October 31, 2003, future minimum

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Fiscal years ending (in thousands)
2004		$	44,042
2005			33,585
2006			25,425
2007			18,559
2008			13,969
Thereafter			59,874
Total minimum lease commitments		$	195,454

      Rental expense for continuing operations for the years ended October 31 is summarized as follows:

(in thousands)		2003				2002				2001
Minimum rentals under noncancelable leases		$	54.360			$	51,441			$	49,506
Contingent rentals			34,390				35,093				44,255
Short-term rental agreements			8,175				11,076				7,029
		$	96,925			$	97,610			$	100,790

      Contingent rentals are applicable to leases of parking lots and garages and are based on percentages of the gross receipts or other financial parameters attributable to the related facilities.

7. CAPITAL STOCK

Common Stock

      On March 12, 2002, ABM’s Board of Directors declared a 2-for-1 split of ABM’s common stock in the form of a 100% stock dividend payable on May 7, 2002 to stockholders of record on March 29, 2002. A total of 24.9 million shares of common stock were issued in connection with the stock split. The par value of the shares was not changed from $0.01.

Treasury Stock

      On September 16, 2001, the Company’s Board of Directors authorized the purchase of up to 2.0 million shares of the Company’s outstanding common stock at any time through December 31, 2001, which authorization was later extended through January 31, 2003. As of October 31, 2002, the Company had purchased 1.4 million shares at a cost of $23.6 million (an average price per share of $16.88). In the three months ended January 31, 2003, the Company purchased the remaining 0.6 million shares at a cost of $9.3 million (an average price per share of $15.50).

      On March 11, 2003, the Company’s Board of Directors authorized the purchase of up to 2.0 million additional shares of the Company’s outstanding common stock at any time through December 31, 2003. As of October 31, 2003, the Company purchased 1.4 million shares under this authorization at a cost of $21.1 million (an average price per share of $15.04) and 0.6 million shares are available for purchase.

      On December 9, 2003, the Company’s Board of Directors authorized the purchase of up to 2.0 million additional shares of the Company’s outstanding common stock at any time through December 31, 2004.

Preferred Stock

      The Company is authorized to issue 0.5 million shares of preferred stock. None of these preferred shares are currently issued.

Common Stock Rights Plan

      Under the Company’s stockholder rights plan one preferred stock purchase right (a Right) attached to each outstanding share of common stock on April 22, 1998, and a Right has attached or will attach to each subsequently issued share of common stock. The Rights are exercisable only if a person or group acquires 20% or more of the Company’s common stock (an Acquiring Person) or announces a tender offer for 20% or more of the common stock. Each Right entitles stockholders to buy one-two thousandths of a share of newly created Participating Preferred Stock, par value $0.01 per share, of the Company at an initial exercise price of $87.50 per Right, subject to adjustment from time to time. However, if any person becomes an Acquiring Person, each Right will then entitle its holder (other than the Acquiring Person) to purchase at the exercise price common stock (or, in certain circumstances, Participating Preferred Stock) of the Company having a market value at that time of twice the Right’s exercise price. These Rights holders would also be entitled to purchase an equivalent number of shares at the exercise price if the Acquiring Person were to control the Company’s Board of Directors and cause the Company to enter into certain mergers or other transactions. In addition, if an Acquiring Person acquired between 20% and 50% of the Company’s voting stock, the Company’s Board of Directors may, at its option, exchange one share of the Company’s common stock for each Right held (other than Rights held by the Acquiring Person). Rights held by the Acquiring Person will

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Stock Options

      The Company has four types of stock option plans which are described below.

	“Time-Vested” Incentive Stock Option Plan

      In 1987, the Company adopted a stock option plan under which 2.4 million shares were reserved for grant. In March 1994, this plan was amended to reserve an additional 2.0 million shares. In March 1996, the plan was amended again to reserve another 4.0 million shares. The options become exercisable at a rate of 20% per year beginning one year after date of grant and terminate no later than 10 years plus one month after date of grant. Options which terminate without being exercised may be reissued. At October 31, 2003, 0.9 million shares remained available for grant.

      Transactions under this plan are summarized as follows:

---

						Weighted
		Number				Average
		of				Exercise
		Options				Price
Balance October 31, 2000			3,704,000			$	9.62
Granted (Weighted average fair value of $4.70)			546,000			$	15.16
Exercised			(868,000	)		$	6.88
Forfeitures			(216,000	)		$	12.26
Balance October 31, 2001			3,166,000			$	11.14
Granted (Weighted average fair value of $4.56)			313,000			$	8.48
Exercised			(505,000	)		$	14.94
Forfeitures			(346,000	)		$	13.00
Balance October 31, 2002			2,628,000			$	11.86
Granted (Weighted average fair value of $3.15)			483,000			$	14.88
Exercised			(381,000	)		$	7.35
Forfeitures			(100,000	)		$	15.35
Balance October 31, 2003			2,630,000			$	12.93

      In November 2003, 0.2 million shares, with a weighted average exercise price of $15.77 were granted under this plan.

														Exercisable at
Outstanding at October 31, 2003														October 31, 2003
						Weighted
						Average				Weighted								Weighted
						Remaining				Average								Average
Range of		Number of				Contractual				Exercise				Number of				Exercise
Prices		Options				Life (Years)				Price				Options				Price
$ 4.24 – 6.66			168,000				1.0			$	5.24				168,000			$	5.24
$ 8.72 – 14.1			1 1,137,000				4.8			$	10.94				815,000			$	10.35
$14.70 – 18.30			1,325,000				7.2			$	15.62				552,000			$	16.12
Total			2,630,000				5.7			$	12.93				1,535,000			$	11.87

	“Price-Vested” Performance Stock Option Plans

      In December 1996, the Company adopted a stock option plan (the 1996 Plan) under which 3.0 million shares have been reserved. In December 2001, the Company adopted an additional but substantially similar plan (the 2002 Plan) under which 4.0 million shares were reserved for grant under the plan. The options expire ten years after the date of grant and any options which terminate without being exercised may be reissued. Each option has a pre-defined vesting price which provides for accelerated vesting. If, during the first four years, the stock price achieved and maintained a set price for ten out of thirty consecutive trading days, the options associated with the price would vest. The prices established were $12.50, $15.00, $17.50 and $20.00 in the 1996 Plan. On September 10, 2002, the Board of Directors established accelerated vesting prices of $20.00, $22.50, $25.00 and $27.50 for the 2002 Plan. The 1996 Plan and 2002 Plan provide that 25% of the options granted will vest at each price point. If, at the end of four years, any of the stock price performance targets were not achieved, then the remaining options would vest at the end of eight years from the date the options were granted. Options vesting during the first year following grant do not become exercisable until after the first anniversary of grant. At October 31, 2003, 0.2 million and 2.8 million shares remained available for grant under the 1996 Plan and 2002 Plan, respectively.

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      Transactions under these plans are summarized as follows:

---

						Weighted
		Number				Average
		of				Exercise
		Options				Price
Balance October 31, 2000			2,290,000			$	11.17
Granted (Weighted average fair value of $5.48)			360,000			$	15.38
Exercised			(420,000	)		$	10.09
Forfeitures			(170,000	)		$	13.95
Balance October 31, 2001			2,060,000			$	11.89
Granted (Weighted average fair value of $6.09)			1,190,000			$	16.67
Exercised			(130,000	)		$	13.89
Forfeitures			(60,000	)		$	10.06
Balance October 31, 2002			3,060,000			$	13.70
Granted (Weighted average fair value of $3.60)			231,000			$	14.59
Exercised			(130,000	)		$	10.09
Forfeitures			(150,000	)		$	16.29
Balance October 31, 2003			3,011,000			$	13.79

														Exercisable at
Outstanding at October 31, 2003														October 31, 2003
						Weighted
						Average				Weighted								Weighted
						Remaining				Average								Average
Range of		Number of				Contractual				Exercise				Number of				Exercise
Prices		Options				Life (Years)				Price				Options				Price
$10.00 – 12.80			1,220,000				3.5			$	10.18				860,000			$	10.23
$13.20 – 18.30			1,791,000				8.2			$	16.26				450,000			$	15.94
Total			3,011,000				6.3			$	13.79				1,310,000			$	12.20

	“Age-Vested” Career Stock Option Plan

      In 1984, the Company adopted a stock option plan whereby 1.36 million shares were reserved for grant. In March 1996, another 2.0 million shares were reserved for grant under the plan. As amended on December 20, 1994, options which have been granted at fair market value are 50% exercisable when the option holders reach their 61st birthdays and the remaining 50% will vest on their 64th birthdays. To the extent vested, the options may be exercised at any time prior to one year after termination of employment. On December 9, 2003, the Board of Directors amended the plan to provide that no further grants may be made under the Plan. At the time of this amendment, 1.0 million shares were available for grant under the plan. These shares, as well as any shares related to options that are cancelled without being exercised, will no longer be reserved for issuance under the plan.

      Transactions under this plan are summarized as follows:

---

						Weighted
		Number				Average
		of				Exercise
		Options				Price
Balance October 31, 2000			2,202,000			$	10.48
Granted (Weighted average fair value of $6.42)			146,000			$	15.38
Exercised			(422,000	)		$	5.65
Forfeitures			(92,000	)		$	10.29
Balance October 31, 2001			1,834,000			$	11.50
Granted (Weighted average fair value of $6.29)			155,000			$	15.38
Exercised			(79,000	)		$	10.40
Forfeitures			(139,000	)		$	13.84
Balance October 31, 2002			1,771,000			$	11.72
Granted			—				—
Exercised			(30,000	)		$	8.70
Forfeitures			(190,000	)		$	15.34
Balance October 31, 2003			1,551,000			$	11.31

										Exercisable at
Outstanding at October 31, 2003										October 31, 2003
						Weighted
						Average				Weighted								Weighted
						Remaining				Average				Number				Average
Range of		Number of				Contractual				Exercise				Of				Exercise
Prices		Options				Life (Years)				Price				Options				Price
$ 2.86			308,000				3.0			$	2.86				104,000			$	2.86
$ 5.63 –  9.72			183,000				6.1			$	5.96				22,000			$	5.63
$10.38			103,000				15.6			$	10.38				—				—
$14.70 – 18.30			957,000				10.7			$	15.15				170,000			$	15.12
Total			1,551,000				8.9			$	11.31				296,000			$	10.11

          Employee Stock Purchase Plan

      In 1985, the Company adopted an employee stock purchase plan under which sale of 10.0 million shares of its common stock has been authorized. In March 1996 and 1999, sales of an additional 2.4 million shares each were authorized, and again in March 2001, 2.4 million additional shares were authorized under this plan. The purchase price of the shares under the plan is the lesser of 85% of the fair market value at the commencement of each plan year or 85% of the fair market value on the date of purchase. Employees may designate up to 10% of their compensation for the purchase of stock, subject to a $25,000 annual limit. During 2003, 2002, and 2001, 0.9 million, 0.9 million and 1.1 million shares of stock were issued under the plan for aggregate purchase prices of $11.1 million, $11.6 million and $12.1 million, respectively. The weighted average fair value of those purchase rights granted in 2003, 2002

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      On December 9, 2003, the Board of Directors of ABM approved the submission of a new employee stock purchase plan to ABM’s stockholders for approval at the 2004 Annual Meeting. Under the proposed plan the purchase price of the shares under the plan will be determined twice a year on the 1st of May and November of each plan year and it will be the lesser of 85% of the fair market value on those dates or 85% of the fair market value on the date of monthly purchases. Employees may designate up to 10% of their compensation for the purchase of stock, subject to a $25,000 annual limit. Employees will be required to hold their shares for six months from the date of purchase.

8. INCOME TAXES

      The income taxes provision for continuing operations is made up of the following components for each of the years ended October 31:

(in thousands)			2003				2002				2001
Current
	Federal		$	22,402			$	19,408			$	26,346
	State			2,030				2,887				3,887
	Foreign			110				63				41
Deferred
	Federal			(5,720	)			(2,529	)			(10,894	)
	State			(368	)			1,122				(1,121	)
			$	18,454			$	20,951			$	18,259

      Income tax expense attributable to income from continuing operations differs from the amounts computed by applying the U.S. statutory rates to pretax income from continuing operations as a result of the following for the years ended October 31:

		2003				2002				2001
Statutory rate			35.0	%			35.0	%			35.0	%
State and local taxes on income, net of federal tax benefit			3.2				3.1				3.6
Tax credits			(5.6	)			(6.1	)			(5.7	)
Tax liability no longer required			—				(2.2	)			—
Nondeductible expenses and other — net			1.0				2.4				5.0
			33.6	%			32.2	%			37.9	%

      The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at October 31 are presented below:

(in thousands)			2003				2002
Deferred tax assets:
	Self-insurance claims		$	48,343			$	45,202
	Bad debt allowance			2,421				2,119
	Deferred and other compensation			14,441				14,046
	Goodwill			—				1,105
	State taxes payable			2,469				791
	Other			7,459				2,932
Total gross deferred tax assets				75,133				66,195
Deferred tax liabilities:
	Goodwill			(3,798	)			—
	Deferred software development cost			(2,534	)			(3,482	)
Total gross deferred tax liabilities				(6,332	)			(3,482	)
Net deferred tax assets of continuing operations				68,801				62,713
Net deferred tax assets of discontinued operation				—				831
Net deferred tax assets			$	68,801			$	63,544

      Management has determined that it is more likely than not that the total net deferred tax asset will be realized.

9. ACQUISITIONS

      All acquisitions have been accounted for using the purchase method of accounting. Operations of the companies and businesses acquired have been included in the accompanying consolidated financial statements from their respective dates of acquisition. The excess of the purchase price (including contingent amounts) over fair value of the net assets acquired is generally included in goodwill. Most purchase agreements provide for initial payments and contingent amounts based on the annual pretax income or other financial parameters for subsequent periods ranging generally from two to five years. Cash paid for acquisitions, including down payments and contingent amounts was $40.6 million, $52.4 million and $23.4 million in the years ended October 31, 2003, 2002 and 2001, respectively. In addition, shares of common stock with a fair market value of $1.4 million and $1.7 million at the date of issuance were issued in 2002 and 2001, respectively. The common stock issuance in 2002 was the final payment made under the contingent payment provisions of a 1997 acquisition.

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      Acquisitions made during the year ended October 31, 2003 are discussed below:

      On January 31, 2003, the Company acquired the commercial self-performed janitorial cleaning operations of Horizon National Commercial Services, LLC, a provider of janitorial services based in Red Bank, New Jersey. Assets acquired by the Company include key customer accounts in the eastern, mid-western and south central United States. The total adjusted acquisition cost was $14.7 million, which included the assumption of payroll related liabilities totaling $0.2 million. Of the total adjusted acquisition cost, $12.9 million was allocated to goodwill and $1.8 million to fixed and other assets at the time of acquisition.

      On April 30, 2003, the Company acquired selected assets of Valet Parking Service, a provider of parking services based in Culver City, California. The total acquisition cost was $1.7 million, most of which was allocated to goodwill, plus annual contingent amounts of $0.3 million for the three years subsequent to the acquisition date, if specified levels of variable gross profits from the acquired operations are maintained.

      On August 29, 2003, the Company acquired substantially all of the assets and operations of H.G.O., Inc., d/b/a HGO Services, a provider of janitorial services based in King of Prussia, Pennsylvania. Assets acquired by the Company include key customer accounts in the greater Philadelphia metropolitan area, including locations in New Jersey and Delaware. The total acquisition cost was $12.8 million, plus annual contingent amounts of approximately $1.1 million for the three years subsequent to the acquisition date if specified levels of customer accounts are retained, and additional annual contingent amounts for the three years subsequent to the acquisition date if financial performance exceeds agreed-upon levels. Of the total initial acquisition cost, $12.4 million was allocated to goodwill and $0.4 million to fixed and other assets at the time of acquisition. Contingent amounts, if paid, will be allocated to goodwill.

      The operating results generated from these acquisitions are included in the consolidated financial results of the Company from the respective dates of acquisition. Due to the relative size of these acquisitions, pro forma information is not included in the consolidated financial statements.

      During the year ended October 31, 2003, contingent amounts totaling $10.9 million were paid on earlier acquisitions as provided by the respective purchase agreements. All amounts paid were added to goodwill.

      Acquisitions made during the year ended October 31, 2002 are discussed below:

      The Company acquired the service contracts and selected assets of Triumph Security Corporation and Triumph Cleaning Corporation (collectively, Triumph) with customers located in New York City effective January 26 and 28, 2002, respectively. This acquisition contributed $6.4 million in sales in 2002.

      On February 28, 2002, the Company acquired the security contracts, accounts receivable and selected assets of Foulke Associates, Inc. (Foulke) with customers located throughout Georgia, Florida, Maryland, Pennsylvania and Virginia. This acquisition contributed $11.8 million in sales in 2002.

      The total cost of the Triumph and Foulke acquisitions was $8.8 million, of which $7.1 million was allocated to goodwill. The aggregate purchase prices of these acquisitions do not reflect payments of contingent consideration based upon the future results of operations of the businesses acquired. As these acquisitions were not material, pro forma information is not included in the accompanying consolidated financial statements.

      On July 12, 2002, the Company acquired the operations of Lakeside Building Maintenance, Inc. and an affiliated company (collectively, Lakeside) with customers located in Chicago, Cincinnati, Cleveland, Columbus, Detroit, Indianapolis, Louisville, Milwaukee, Nashville and St. Louis. The total down payment acquisition cost was $41.1 million, which included the assumption of liabilities totaling $4.2 million. Of the down payment, $39.5 million was allocated to goodwill. Contingent amounts are payable over a three-year period commencing July 13, 2002. The first two annual payments will be equal to fifty percent of Lakeside’s Adjusted Earnings Before Interest Taxes Depreciation and Amortization (EBITDA) for each year of the two-year period following the acquisition, while the final payment will be equal to $5.3 million provided that the gross sales of Lakeside during the third year following the acquisition are equal to or greater than $131.2 million. This acquisition contributed $51.6 million in revenues in 2002. Included in the ABM results of operations for

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      The following pro forma information for the Lakeside acquisition assumes that the acquisition occurred on November 1, 2000. The actual results of operations of Lakeside for the period July 13, 2002 through October 31, 2002 are included in the ABM results of operations for the year ended October 31, 2002.

			2002												2001
(in thousands, except per share data)			ABM				Lakeside*				Pro Forma				ABM				Lakeside				Pro Forma
							(Unaudited)				(Unaudited)								(Unaudited)				(Unaudited)
Revenues			$	2,078,083			$	113,460			$	2,191,543			$	2,027,800			$	149,434			$	2,177,234
	Operating and SG&A expense			2,012,022				106,413				2,118,435				1,965,008				139,883				2,104,891
	Interest expense			1,052				1,365				2,417				2,600				2,663				5,263
	Goodwill amortization			—				—				—				12,065				2,625				14,690
Total expenses				2,013,074				107,778				2,120,852				1,979,673				145,171				2,124,844
Income from continuing operations before income taxes				65,009				5,682				70,691				48,127				4,263				52,390
Income taxes				20,951				2,063				23,014				18,259				1,620				19,879
Net income from continuing operations			$	44,058			$	3,619			$	47,677			$	29,868			$	2,643			$	32,511
* Represents Lakeside results of operations for the period November 1, 2001 through July 12, 2002.
Net income per common share from continuing operations
Basic			$	0.90				—			$	0.97			$	0.62				—			$	0.67
Diluted			$	0.86				—			$	0.93			$	0.59				—			$	0.64
Average common shares outstanding
Basic				49,116				—				49,116				47,598				—				47,598
Diluted				51,015				—				51,015				50,020				—				50,020

10. DISCONTINUED OPERATION

      On July 9, 2003, ABM Industries Incorporated entered into a Sale Agreement with Otis Elevator to sell substantially all of the operating assets of Amtech Elevator Services, Inc. (a wholly-owned subsidiary which represented the Company’s Elevator segment) to Otis Elevator. On August 15, 2003, the sale was completed. The operating assets sold included customer contracts, accounts receivable, facility leases and other assets, as well as a perpetual license to the name “Amtech Elevator Services.” The consideration in connection with the sale included $112.4 million in cash and Otis Elevator’s assumption of trade payables and accrued liabilities. The Company realized a gain on the sale of $51.5 million which is net of $31.9 million of income taxes.

      The assets and liabilities of the Elevator segment have been segregated and classified as held for sale and the operating results and cash flows have been reported as discontinued operation in the accompanying consolidated financial statements. Income taxes have been allocated using the estimated combined federal and state tax rates applicable to Elevator for each of the periods presented. The prior periods presented have been reclassified.

      The operating results of the discontinued operation for the years ended October 31, 2003, 2002 and 2001 are shown below. Operating results for 2003 are for the period beginning November 1, 2002 through the date of sale, August 15, 2003.

(in thousands)		2003				2002				2001
Revenues		$	88,147			$	113,874			$	121,371
Income before income taxes			4,142				4,319				4,818
Income taxes			1,582				1,649				1,860
Net income		$	2,560			$	2,670			$	2,958

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     Assets and liabilities of the discontinued operation were as follows at August 15, 2003 (the date of sale) and at October 31, 2002 included in the accompanying consolidated balance sheet:

(in thousands)			August 15, 2003				October 31, 2002
Trade accounts receivable, net			$	17,432			$	21,742
Inventories				6,634				5,584
Prepaid expenses and other current assets				518				435
Property, plant and equipment, net				362				420
Goodwill				3,907				3,907
Other assets				48				48
Total assets				28,901				32,136
Trade accounts payable				2,909				2,590
Accrued liabilities:
	Compensation			2,059				1,817
	Taxes — other than income			337				398
	Other			2,564				2,598
Total liabilities				7,869				7,403
Net assets			$	21,032			$	24,733

11.	DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS

      The carrying amounts reported in the balance sheet for cash and cash equivalents approximate fair value due to the short-maturity of these instruments.

      Financial instruments included in investments and long-term receivables have no quoted market prices and, accordingly, a reasonable estimate of fair market value could not be made without incurring excessive costs. However, the Company believes by reference to stated interest rates and security held that the fair value of the assets would not differ significantly from the carrying value.

12. CONTINGENCIES

      In September 1999, a former employee filed a gender discrimination lawsuit against ABM in the state of Washington. On May 19, 2003, a Washington state court jury for the Spokane County Superior Court, in the case named Forbes v. ABM, awarded $4.0 million in damages, and the court later awarded costs of $0.7 million to the former employee. In addition, the court may award the plaintiff up to $0.8 million to mitigate the federal tax impact of the plaintiff’s award (the Washington Supreme Court is currently deciding whether amounts to mitigate federal tax consequences may be awarded in wrongful termination cases). ABM will appeal the jury’s verdict to the State Court of Appeals as well as the award of costs on the grounds that it was denied a fair trial. There can be no assurance that ABM will prevail in this matter. ABM, however, believes that the award against ABM was excessive and that the verdict was inconsistent with the law and the evidence. Because ABM believes that the judgment will be reversed upon appeal, ABM has not recorded any liability in its financial statements associated with the judgment. However, as of October 31, 2003, ABM has incurred and recorded legal fees of $0.1 million associated with the appeal. These fees, which include the cost of a new trial, are expected to total approximately $0.4 million.

      The Company and some of its subsidiaries have been named defendants in certain other litigation arising in the ordinary course of business. In the opinion of management, based on advice of legal counsel, such matters should have no material effect on the Company’s financial position, results of operations or cash flows.

13. SEGMENT INFORMATION

      Under SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information,” segment information is presented under the management approach. The management approach designates the internal organization that is used by management for making operating decisions and assessing performance as the source of the Company’s reportable segments. SFAS No. 131 also requires disclosures about products and services, geographic areas and major customers.

      The Company is currently organized into seven separate operating segments. Under the criteria of SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information,” Janitorial, Parking, Engineering, Security and Lighting are reportable segments. Substantially all of the operating assets of the Elevator segment were sold on August 15, 2003 and its operating results are reported separately under discontinued operation (see Note 10). Mechanical, Facility Services, and Easterday Janitorial Supply, prior to its sale on April 29, 2001, are included in the Other segment. Corporate expenses are not allocated. The unallocated corporate expenses for 2001 included a $20.0 million insurance charge, recorded in the fourth quarter of 2001, (see Note 2) and centralization of marketing and sales expenses. While virtually all insurance claims arise from the operating segments, this adjustment was recorded as unallocated corpo-

44

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45

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SEGMENT INFORMATION

																																		Assets
(in thousands)																														Goodwill				Held For				Consolidated
Year ended October 31, 2003		Janitorial				Parking				Engineering				Security				Lighting				Other				Corporate				Amortization				Sale				Totals
Sales and other income		$	1,368,282			$	380,576			$	180,230			$	159,670			$	127,539			$	45,394			$	785			$	—			$	—			$	2,262,476
Operating profit		$	53,487			$	6,349			$	9,925			$	6,485			$	5,646			$	1,337			$	(27,619	)		$	—			$	—			$	55,610
Interest expense			—				—				—				—				—				—				(758	)			—				—				(758	)
Income from continuing operations before income taxes		$	53,487			$	6,349			$	9,925			$	6,485			$	5,646			$	1,337			$	(28,377	)		$	—			$	—			$	54,852
Identifiable assets		$	364,304			$	78,185			$	35,728			$	35,828			$	80,211			$	13,909			$	187,818			$	—			$	—			$	795,983
Depreciation expense		$	5,425			$	1,368			$	59			$	268			$	1,584			$	176			$	4,804			$	—			$	—			$	13,684
Intangible amortization expense		$	700			$	304			$	—			$	—			$	—			$	141			$	—			$	—			$	—			$	1,145
Capital expenditures		$	5,017			$	1,228			$	18			$	109			$	1,551			$	91			$	3,607			$	—			$	—			$	11,621
Year ended October 31, 2002
Sales and other income		$	1,197,035			$	363,511			$	173,561			$	140,569			$	130,858			$	61,963			$	561			$	—			$	—			$	2,068,058
Gain on insurance claim			—				—				—				—				—				—				10,025				—				—				10,025
Total revenues		$	1,197,035			$	363,511			$	173,561			$	140,569			$	130,858			$	61,963			$	10,586			$	—			$	—			$	2,078,083
Operating profit		$	54,337			$	6,948			$	10,033			$	5,639			$	8,261			$	(1,190	)		$	(27,992	)		$	—			$	—			$	56,036
Gain on insurance claim			—				—				—				—				—				—				10,025				—				—				10,025
Interest expense			—				—				—				—				—				—				(1,052	)			—				—				(1,052	)
Income from continuing operations before income taxes		$	54,337			$	6,948			$	10,033			$	5,639			$	8,261			$	(1,190	)		$	(19,019	)		$	—			$	—			$	65,009
Identifiable assets		$	336,414			$	80,889			$	32,435			$	31,295			$	82,197			$	15,080			$	94,493			$	—			$	32,136			$	704,939
Depreciation expense		$	5,091			$	1,764			$	85			$	304			$	1,725			$	240			$	4,661			$	—			$	—			$	13,870
Intangible amortization expense		$	700			$	244			$	—			$	—			$	—			$	141			$	—			$	—			$	—			$	1,085
Capital expenditures		$	3,643			$	1,119			$	39			$	289			$	722			$	141			$	1,392			$	—			$	—			$	7,345
Year ended October 31, 2001
Sales and other income		$	1,159,914			$	365,073			$	171,008			$	103,980			$	144,319			$	82,188			$	1,318			$	—			$	—			$	2,027,800
Operating profit		$	67,590			$	6,619			$	9,404			$	3,174			$	11,983			$	5,280			$	(41,258	)		$	(12,065	)		$	—			$	50,727
Interest expense			(917	)			—				(7	)			(10	)			—				1				(1,667	)			—				—				(2,600	)
Income from continuing operations before income taxes		$	66,673			$	6,619			$	9,397			$	3,164			$	11,983			$	5,281			$	(42,925	)		$	(12,065	)		$	—			$	48,127
Identifiable assets		$	285,979			$	86,837			$	47,948			$	23,835			$	82,528			$	14,536			$	100,075			$	—			$	41,362			$	683,100
Depreciation expense		$	4,980			$	1,980			$	79			$	221			$	1,542			$	505			$	4,155			$	—			$	—			$	13,462
Intangible amortization expense		$	181			$	180			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	361
Goodwill amortization expense		$	7,728			$	2,569			$	369			$	171			$	945			$	283			$	—			$	—			$	—			$	12,065
Capital expenditures		$	3,659			$	1,612			$	79			$	311			$	2,572			$	1,295			$	7,139			$	—			$	—			$	16,667

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14. QUARTERLY INFORMATION (UNAUDITED)

---

			Fiscal Quarter
(in thousands, except per share amounts)			First				Second				Third				Fourth				Year
Year ended October 31, 2003
Sales and other income			$	552,444			$	562,537			$	569,093			$	578,402			$	2,262,476
Gross profit from continuing operations			$	48,391			$	57,330			$	57,373			$	63,651			$	226,745
Net income from continuing operations			$	3,750			$	9,248			$	10,556			$	12,844			$	36,398
Net income from discontinued operation				588				644				1,182				146				2,560
Net gain on sale of discontinued operation				—				—				—				51,500				51,500
			$	4,338			$	9,892			$	11,738			$	64,490			$	90,458
Net income per common share — Basic
	Income from continuing operations		$	0.08			$	0.19			$	0.21			$	0.26			$	0.74
	Income from discontinued operation			0.01				0.01				0.03				—				0.05
	Gain on sale of discontinued operation			—				—				—				1.05				1.05
			$	0.09			$	0.20			$	0.24			$	1.31			$	1.84
Net income per common share — Diluted
	Income from continuing operations		$	0.08			$	0.18			$	0.21			$	0.26			$	0.73
	Income from discontinued operation			0.01				0.02				0.02				—				0.05
	Gain on sale of discontinued operation			—				—				—				1.03				1.03
			$	0.09			$	0.20			$	0.23			$	1.29			$	1.81
Year ended October 31, 2002
Sales and other income			$	501,059			$	497,616			$	514,260			$	555,123			$	2,068,058
Gain on insurance claim				—				4,300				5,725				—				10,025
Total revenues			$	501,059			$	501,916			$	519,985			$	555,123			$	2,078,083
Gross profit from continuing operations			$	47,379			$	52,036			$	53,318			$	59,345			$	212,078
Net income from continuing operations			$	7,425			$	13,613			$	11,891			$	11,129			$	44,058
Net income from discontinued operation				566				376				743				985				2,670
			$	7,991			$	13,989			$	12,634			$	12,114			$	46,728
Net income per common share — Basic
	Income from continuing operations		$	0.15			$	0.28			$	0.24			$	0.23			$	0.90
	Income from discontinued operation			0.01				—				0.02				0.02				0.05
			$	0.16			$	0.28			$	0.26			$	0.25			$	0.95
Net income per common share — Diluted
	Income from continuing operations		$	0.15			$	0.26			$	0.23			$	0.22			$	0.86
	Income from discontinued operation			0.01				0.01				0.02				0.02				0.06
			$	0.16			$	0.27			$	0.25			$	0.24			$	0.92

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ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

      Not applicable.

ITEM 9 A.	CONTROLS AND PROCEDURES

      The Company’s principal executive officer and principal financial officer have concluded that the effectiveness of the Company’s disclosure controls and procedures (as defined in Securities Exchange Act of 1934 (“Exchange Act”) Rules 13a-15(e) or 15d-15(e)) was adequate as of the end of the period covered by this Annual Report on Form 10-K, based on the evaluation of these controls and procedures required by paragraph (b) of Exchange Act Rules 13a-15 or 15d-15.

      No change in the Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the Company’s fourth fiscal quarter has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART III

ITEM 10.	DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

      The information required by this item regarding ABM’s executive officers is included in Part I under “Executive Officers.” The information required by this item regarding ABM’s directors is incorporated by reference to the information set forth under the caption “Election of Directors” in the Proxy Statement to be used by ABM in connection with its 2004 Annual Meeting of Stockholders.

      The information required by this item regarding ABM’s audit committee financial expert is incorporated by reference to the information set forth under the caption “Audit Committee” in the Proxy Statement to be used by ABM in connection with its 2004 Annual Meeting of Stockholders. The information required by this item regarding compliance with Section 16(a) of the Exchange Act is incorporated by reference to the information set forth under the caption “Section 16(a) Beneficial Ownership Reporting Compliance” in the Proxy Statement to be used by ABM in connection with its 2004 Annual Meeting of Stockholders.

      The Company has adopted and posted on its Website (www.abm.com) the ABM Code of Business Conduct & Ethics (the “Code of Ethics”) that applies to all directors, officers and employees of the Company, including the Company’s Chief Executive Officer, Chief Financial Officer and Corporate Controller. If any amendments are made to the Code of Ethics or if any waiver, including any implicit waiver, from a provision of the Code of Ethics is granted to the Company’s Chief Executive Officer, Chief Financial Officer or Corporate Controller, the Company will disclose the nature of such amendment or waiver on its Website.

ITEM 11.	EXECUTIVE COMPENSATION

      The information required by this item is incorporated by reference to the information set forth under the captions “Executive Compensation” and “Further Information Concerning the Board of Directors” contained in the Proxy Statement to be used by ABM in connection with its 2004 Annual Meeting of Stockholders.

ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

      The information required by this item regarding security ownership of certain beneficial owners and management is incorporated by reference to the information set forth under the caption “Principal Stockholders” contained in the Proxy Statement to be used by ABM in connection with its 2004 Annual Meeting of Stockholders.

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      Equity Compensation Plan Information as of October 31, 2003:

Number of

Number of

securities remaining

securities to be

Weighted-

available for future

issued upon

average exercise

issuance under

exercise of

price of

equity compensation

outstanding

outstanding

plans (excluding

options, warrants

options, warrants

securities reflected

and rights

and rights

in column(a))

Plan Category

(a)

(b)

(c)

Equity compensation plans approved by security holders

7,192,000

$

12.94

5,011,000

(1)

Equity compensation plans not approved by security holders

—

—

—

Total

7,192,000

$

12.94

5,011,000

(1) This amount includes 86,000 shares of common stock available for issuance under the Company’s Employee Stock Purchase Plan.

ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      The information required by this item is incorporated by reference to the information set forth under the captions “Executive Compensation” and “Further Information Concerning the Board of Directors” contained in the Proxy Statement to be used by ABM in connection with the 2004 Annual Meeting of Stockholders.

ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES

      The information required by this item is incorporated by reference to the information set forth under the caption “Appointment of Auditors” contained in the Proxy Statement to be used by ABM in connection with the 2004 Annual Meeting of Stockholders.

ITEM 15.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

      (a) The following documents are filed as part of this Form 10-K:

	1. Consolidated Financial Statements of ABM Industries Incorporated and Subsidiaries:

	Independent Auditors’ Report
	Consolidated Balance Sheets — October 31, 2003 and 2002
	Consolidated Statements of Income — Years ended October 31, 2003, 2002 and 2001
	Consolidated Statements of Stockholders’ Equity and Comprehensive Income — Years ended October 31, 2003, 2002 and 2001
	Consolidated Statements of Cash Flows — Years ended October 31, 2003, 2002 and 2001
	Notes to Consolidated Financial Statements.

	2. Consolidated Financial Statement Schedule of ABM Industries Incorporated and Subsidiaries:

	Schedule II — Consolidated Valuation Accounts — Years ended October 31, 2003, 2002 and 2001.

      All other schedules are omitted because they are not applicable or because the required information is included in the consolidated financial statements or the notes thereto.

      The individual financial statements of the registrant’s subsidiaries have been omitted since the registrant is primarily an operating company and all subsidiaries included in the consolidated financial statements are wholly-owned subsidiaries.

	3. Exhibits:

	See Exhibit Index.

      (b) Reports on Form 8-K:

      The Company filed a report on Form 8-K dated August 15, 2003 pursuant to Item 2, which announced the completion of the Company’s sale of substantially all of the operating assets of its wholly-owned subsidiary, Amtech Elevator Services, Inc., a California corporation, to Otis Elevator Company, a New Jersey corporation and a wholly-owned subsidiary of United Technologies Corporation, pursuant to a Sale Agreement dated as of July 9, 2003.

      The Company filed a report on Form 8-K dated September 9, 2003 pursuant to Item 5, which announced the declaration of its quarterly dividend and furnished in the same report pursuant to Item 12 its financial results related to the third quarter of fiscal year 2003.

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SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

ABM Industries Incorporated

By:	/s/ Henrik C. Slipsager

      Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ Henrik C. Slipsager
Henrik C. Slipsager, President, Chief Executive Officer and Director (Principal Executive Officer) January 14, 2004
/s/ George B. Sundby		/s/ Maria De Martini
George B. Sundby Senior Vice President and Chief Financial Officer (Principal Financial Officer) January 14, 2004		Maria De Martini Vice President, Controller and Chief Accounting Officer (Principal Accounting Officer) January 14, 2004
/s/ Linda Chavez		/s/ Luke S. Helms
Linda Chavez, Director January 14, 2004		Luke S. Helms, Director January 14, 2004
/s/ Maryellen C. Herringer		/s/ Charles T. Horngren
Maryellen C. Herringer, Director January 14, 2004		Charles T. Horngren, Director January 14, 2004
/s/ Henry L. Kotkins, Jr.		/s/ Martinn H. Mandles
Henry L. Kotkins, Jr., Director January 14, 2004		Martinn H. Mandles Chairman of the Board and Director January 14, 2004
/s/ Theodore Rosenberg		/s/ William W. Steele
Theodore Rosenberg, Director January 14, 2004		William W. Steele, Director January 14, 2004

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Schedule II

CONSOLIDATED VALUATION ACCOUNTS

		Balance				Charges to				Write-offs				Balance
		Beginning				Costs and				Net of				End of
(in thousands)		of Year				Expenses				Recoveries				Year
Allowance for Doubtful Accounts
Years ended October 31,
2003		$	5,543				6,544				(5,748	)		$	6,339
2002			8,457				10,381				(13,295	)			5,543
2001			8,238				5,389				(5,170	)			8,457

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      Exhibit Index

Exhibit Number				Description
	3.1			Restated Certificate of Incorporation of ABM Industries Incorporated, dated November 25, 2003.
	3.2			Bylaws, as amended June 10, 2003 (incorporated by reference to Exhibit No. 3.2 to the registrant’s Form 10-Q Quarterly Report for the quarter ended July 31, 2003, File No. 1-8929).
	4.1			Credit Agreement, dated as of June 28, 2002, among ABM Industries Incorporated, various financial institutions and Bank of America, N.A., as Administrative Agent, as amended through April 23, 2003 (incorporated by reference to Exhibit No. 4.1 to the registrant’s Form 10-Q Quarterly Report for the quarter ended April 30, 2003, File No. 1-8929).
	10.1†			1987 Stock Option Plan, as amended, effective December 19, 1995 (now known as “Time-Vested‘ Incentive Stock Option Plan) (incorporated by reference to Exhibit No. 10.13 to the registrant’s Form 10-Q Quarterly Report for the quarter ended April 30, 1996, File No. 1-8929).
	10.2			Rights Agreement, dated as of March 17, 1998, between the Company and Chase Mellon Shareholder Services, L.L.C., as Rights Agent (incorporated by reference to Exhibit No. 4.1 to the registrant’s Form 8-K Current Report dated as of March 17, 1998, File No. 1-8929).
	10.3†			Deferred Compensation Plan (incorporated by reference to Exhibit No. 10.28 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 1993, File No. 1-8929).
	10.4†			Form of Indemnification Agreement for Directors (incorporated by reference to Exhibit No. 10.20 to the registrant’s Form 10-Q Quarterly Report for the quarter ended April 30, 1991, File No. 1-8929).
	10.5†			1996 ABM Industries Incorporated Long-Term Senior Executive Stock Option Plan (now known as “1996 Price-Vested” Performance Stock Option Plan) (incorporated by reference to Exhibit No. 10.40 to the registrant’s Form 10-Q Quarterly Report for the quarter ended April 30, 1997, File No. 1-8929).
	10.6†			Amendment No. 2 to the ABM Industries Incorporated 1987 Incentive Stock Option Plan (December 19, 1994 Restatement) Plan (now known as “Time-Vested” Incentive Stock Option Plan) (incorporated by reference to Exhibit No. 10.48 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 1999, File No. 1-8929).
	10.7†			Amendment No. 3 to the “Time-Vested” Incentive Stock Option Plan (incorporated by reference to Exhibit No. 10.49 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 1999, File No. 1-8929).
	10.8†			Amendment No. 4 to the ABM Industries Incorporated “Time-Vested” Incentive Stock Option Plan (December 19, 1995 Restatement) (incorporated by reference to Exhibit No. 10.50 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 1999, File No. 1-8929).
	10.9†			Amendment No. 1 to the Long-Term Senior Executive Incentive Stock Option Plan Adopted December 1996 (now known as “1996 Price-Vested” Performance Stock Option Plan) (incorporated by reference to Exhibit No. 10.54 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 1999, File No. 1-8929).
	10.10†			Amendment No. 2 to the “Price-Vested” Performance Stock Option Plan (now known as “1996 Price-Vested” Performance Stock Option Plan) (incorporated by reference to Exhibit No. 10.55 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 1999, File No. 1-8929).
	10.11†			Amendment No. 3 to the ABM Industries Incorporated “Price-Vested” Performance Stock Option Plan (now known as “1996 Price-Vested” Performance Stock Option Plan) (incorporated by reference to Exhibit No. 10.56 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 1999, File No. 1-8929).
	10.12†			Employee Stock Purchase Plan (as amended through May 1, 2000) (incorporated by reference to Exhibit No. 10.59 to the registrant’s Form 10-Q Quarterly Report for the quarter ended January 31, 2001, File No. 1-8929).
	10.13†			Amendment No. 1 to Employee Stock Purchase Plan (May 2000 Restatement) (incorporated by reference to Exhibit No. 10.60 to the registrant’s Form 10-Q Quarterly Report for the quarter ended April 30 2001, File No. 1-8929).
	10.14†			2002 Price-Vested Performance Stock Option Plan (incorporated by reference to Exhibit No. 10.69 to the registrant’s Form 10-Q Quarterly Report for the quarter ended April 30 2002, File No. 1-8929).
	10.15†			Agreement with Martinn H. Mandles (incorporated by reference to Exhibit No. 10.71 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 2002, File No. 1-8929).
	10.16			First Amendment to Rights Agreement, dated as of May 6, 2002, between ABM Industries Incorporated and Mellon Investor Services LLC, as successor Rights Agent (incorporated by reference to Exhibit No. 10.77 to the registrant’s Form 10-K Annual Report for the fiscal year ended October 31, 2002, File No. 1-8929).
	10.17†			Service Award Plan amended as of January 1, 2003.
	10.18†			Form of Stock Option Agreement Under 2002 Price-Vested Performance Stock Option Plan.
	10.19†			1984 Executive Stock Option Plan as amended and restated December 9, 2003 (now known as “Age-Vested” Career Stock Option Plan).
	10.20†			Supplemental Executive Retirement Plan as amended and restated December 9, 2003.
	10.21†			Form of Corporate Executive Employment Agreement with other than those specifically named.
	10.22†			Corporate Executive Employment Agreement with Henrik C. Slipsager as of November 1, 2003.
	10.23†			Corporate Executive Employment Agreement with Jess E. Benton, III, as of November 1, 2003.
	10.24†			Corporate Executive Employment Agreement with James P. McClure as of November 1, 2003.
	10.25†			Corporate Executive Employment Agreement with George B. Sundby as of November 1, 2003.
	10.26†			Corporate Executive Employment Agreement with Steven M. Zaccagnini as of November 1, 2003.
	10.27†			Form of Non-Employee Director Retirement Benefit Agreement.
	21.1			Subsidiaries of the Registrant.
	23.1			Consent of Independent Auditors.
	31.1			Certification of Chief Executive Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
	31.2			Certification of Chief Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
	32.1			Certifications pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

†	Management contract, compensatory plan or arrangement.

52

EXHIBIT 3.1

                      RESTATED CERTIFICATE OF INCORPORATION
                                       OF
                           ABM INDUSTRIES INCORPORATED
                             A Delaware Corporation

                  ABM Industries Incorporated, a corporation organized and
existing under the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY:

                  FIRST: The name of the Corporation is ABM Industries
Incorporated and the name under which the Corporation was originally
incorporated was American Building Maintenance Industries, Inc. The
Corporation's original Certificate of Incorporation was filed with the Secretary
of State of Delaware on March 19, 1985.

                  SECOND: The Restated Certificate of Incorporation of ABM
Industries Incorporated in the form attached hereto as Exhibit A restates and
integrates but does not further amend the Certificate of Incorporation of ABM
Industries Incorporated, and there is no discrepancy between the provisions of
the Corporation's Certificate of Incorporation as heretofore amended or
supplemented and the provisions of the Restated Certificate of Incorporation
attached hereto, which has been duly adopted in accordance with the provisions
of Sections 141(f) and 245 of the General Corporation Law of the State of
Delaware by unanimous written consent of the board directors of the Corporation
on October 28, 2003.

                  THIRD: The Restated Certificate of Incorporation so adopted
reads in full as set forth in Exhibit A attached hereto and incorporated herein
by this reference.

                  IN WITNESS WHEREOF, we have hereunto set our hands as
President and Chief Executive Officer and Secretary, respectively, of ABM
Industries Incorporated and hereby affirm under penalties of perjury that the
foregoing is our act and deed and the facts herein stated are true, and
accordingly have hereunto set forth our hands this 25th day of November, 2003.

                                              /s/ Henrik C. Slipsager
                                        ----------------------------------------
                                                 Henrik C. Slipsager
                                        President and Chief Executive Officer

ATTEST:      /s/ Linda S. Auwers
        --------------------------------------
             Linda S. Auwers, Secretary



EXHIBIT 3.1

                                                                       Exhibit A

                      RESTATED CERTIFICATE OF INCORPORATION
                                       OF
                           ABM INDUSTRIES INCORPORATED

         FIRST: The name of this corporation is: ABM Industries Incorporated.

         SECOND: The address of the registered office of the corporation in the
State of Delaware is Corporation Trust Center, 1209 Orange Street, in the City
of Wilmington, County of New Castle, and the name of its registered agent at
that address is The Corporation Trust Company.

         THIRD: (omitted)

         FOURTH: The purpose of the corporation is to engage in any lawful act
or activity for which corporations may be organized under the General
Corporation Law of Delaware.

         FIFTH: (a) The corporation is authorized to issue two classes of shares
to be designated, respectively, "Preferred Stock" and "Common Stock." The number
of shares of Preferred Stock authorized to be issued is Five Hundred Thousand
(500,000) and the number of shares of Common Stock authorized to be issued is
One Hundred Million (100,000,000). The stock, whether Preferred Stock or Common
Stock, shall have a par value of $0.01 per share.

         (b) The shares of Preferred Stock may be issued from time to time in
one or more series. The Board of Directors is authorized, by filing a
certificate pursuant to the applicable law of the State of Delaware, to
establish from time to time the number of shares to be included in each such
series, and to fix the designation, powers, preferences and rights of the shares
of each such series and the qualifications, limitations or restrictions thereof,
including but not limited to the fixing or alteration of the dividend rights,
dividend rate, conversion rights, voting rights, rights and terms of redemption
(including sinking fund provisions), the redemption price or prices, and the
liquidation preferences of any wholly unissued series of shares of Preferred
Stock; and to increase or decrease the number of shares of any series subsequent
to the issue of shares of that series, but not below the number of shares of
such series then outstanding. In case the number of shares of any series shall
be so decreased, the shares constituting such decrease shall resume the status
which they had prior to the adoption of the resolution originally fixing the
number of shares of such series.

         A Certificate of Designation heretofore adopted is attached as
Attachment 1.

         SIXTH: In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized to make, repeal, alter,
amend and rescind from time to time any or all of the by-laws of the
corporation; including by-law amendments increasing or reducing the authorized
number of directors. In addition, new by-laws may be adopted or the by-laws may
be amended or repealed by a vote of not less than seventy percent (70%) of the
outstanding stock of the corporation entitled to vote thereon.



EXHIBIT 3.1

         SEVENTH: (a) The number of directors which shall constitute the whole
Board of Directors of this corporation shall be as specified in the by-laws of
this corporation, subject to the provisions of Article SIXTH hereof and this
Article SEVENTH.

         (b) The Board of Directors shall be and is divided into three classes:
Class I, Class II and Class III, which shall be as nearly equal in number as
possible. Each director shall serve for a term ending on the date of the third
annual meeting of stockholders following the annual meeting at which the
director was elected; provided, however, that each initial director in Class I
shall hold office until the annual meeting of stockholders in 1986; each initial
director in Class II shall hold office until the annual meeting of stockholders
in 1987; and each initial director in Class III shall hold office until the
annual meeting of stockholders in 1988. Notwithstanding the foregoing provisions
of this Article, each director shall serve until his successor is duly elected
and qualified or until his death, resignation or removal.

         (c) In the event of any increase or decrease in the authorized number
of directors, (1) each director then serving as such shall nevertheless continue
as a director of the class of which he is a member until the expiration of his
current term, or his earlier resignation, removal from office or death, and (2)
the newly created or eliminated directorship resulting from such increase or
decrease shall be apportioned by the Board of Directors among the three classes
of directors so as to maintain such classes as nearly equal as possible.

         EIGHTH: No action shall be taken by the stockholders except at an
annual or special meeting of stockholders. No action shall be taken by
stockholders by written consent.

         NINTH: Special meetings of the stockholders of this corporation for any
purpose or purposes may be called at any time by the Board of Directors, or by a
committee of the Board of Directors which has been duly designated by the Board
of Directors and whose powers and authority, as provided in a resolution of the
Board of Directors or in the by-laws of this corporation, include the power to
call such meetings, but such special meetings may not be called by any other
person or persons.

         TENTH: 1. The affirmative vote of the holders of not less than seventy
percent (70% ) of the outstanding shares of "Voting Stock" (as hereinafter
defined) shall be required for the approval or authorization of any "Business
Combination" (as hereinafter defined) of this corporation or any subsidiary of
this corporation with any "Related Person" (as hereinafter defined),
notwithstanding the fact that no vote may be required or that a lesser
percentage may be specified by law, in any agreement with any national
securities exchange or otherwise; provided, however, that the seventy percent
(70% ) voting requirement shall not be applicable and such Business Combination
shall require only such affirmative vote as is required by law, any agreement
with any national securities exchange or otherwise if:

         (a) The "Continuing Directors" (as hereinafter defined) of this
corporation by at least a majority vote have expressly approved such Business
Combination either in advance of or subsequent to such Related Person becoming a
Related Person; or

         (b) All of the following conditions are met:

                                        2



EXHIBIT 3.1

         (i) The cash or "Fair Market Value" (as hereinafter defined) as of the
date of the consummation of the Business Combination (the "Combination Date") of
the property, securities or other consideration to be received per share by
holders of a particular class or series of capital stock, as the case may be, of
this corporation in the Business Combination is not less than the highest of:

                           (A) the highest per share price (including brokerage
                  commissions, transfer taxes and soliciting dealers' fees) paid
                  by or on behalf of the Related Person in acquiring beneficial
                  ownership of any of its holdings of such class or series of
                  capital stock of this corporation (i) within the two-year
                  period immediately prior to the Combination Date or (ii) in
                  the transaction or series of transactions in which the Related
                  Person became a Related Person, whichever is higher; or

                           (B) the Fair Market Value per share of the shares of
                  capital stock being acquired in the Business Combination (i)
                  as the Combination Date or (ii) the date on which the Related
                  Person became a Related Person, whichever is higher; or

                           (C) in the case of Common Stock, the per share book
                  value of the Common Stock as reported at the end of the fiscal
                  quarter immediately prior to the Combination Date, and in the
                  case of Preferred Stock, the highest preferential amount per
                  share to which the holders of shares of such class or series
                  of Preferred Stock would be entitled in the event of any
                  voluntary or involuntary liquidation, dissolution or winding
                  up of the affairs of the Corporation, regardless of whether
                  the Business Combination to be consummated constitutes such an
                  event.

                  The provision of this paragraph 1(b)(i) shall be required to
         be met with respect to every class or series of outstanding capital
         stock, whether or not the Related Person has previously acquired any
         shares of a particular class or series of capital stock. In all of the
         above instances, appropriate adjustments shall be made for
         recapitalizations and for stock dividends, stock splits and like
         distributions; and

                  (ii) The consideration to be received by holders of a
         particular class or series of capital stock shall be in cash or in the
         same form as previously has been paid by or on behalf of the Related
         Person in connection with its direct or indirect acquisition of
         beneficial ownership of shares of such class or series of stock. If the
         consideration so paid for any such share varied as to form, the form of
         consideration for such shares shall be either cash or the form used to
         acquire beneficial ownership of the largest number of shares of such
         class or series of capital stock previously acquired by the Related
         Person; and

                  (iii) After such Related Person has become a Related Person
         and prior to the consummation of such Business Combination: (a) except
         as approved by a majority of the Continuing Directors, there shall have
         been no failure to declare and pay at the regular date therefor any
         full quarterly dividends (whether or not cumulative) on the outstanding
         Preferred Stock; (b) there shall have been (1) no reduction in the
         annual rate of dividends paid on the Common Stock (except as necessary
         to reflect any subdivision

                                        3



EXHIBIT 3.1

         of the Common Stock), except as approved by a majority of the
         Continuing Directors, and (2) an increase in such annual rate of
         dividends as necessary to reflect any reclassification (including any
         reverse stock split), recapitalization, reorganization or any similar
         transaction which has the effect of reducing the number of outstanding
         shares of the Common Stock, unless the failure so to increase such
         annual rate is approved by a majority of the Continuing Directors; and
         (c) such Related Person shall have not become the beneficial owner of
         any additional shares of Voting Stock except as part of the transaction
         which results in such Related Person becoming a Related Person; and

                  (iv) After such Related Person has become a Related Person,
         such Related Person shall not have received the benefit, directly or
         indirectly (except as proportionately as a stockholder), of any loans,
         advances, guarantees, pledges or other financial assistance or any tax
         credits or other tax advantages provided by the corporation, whether in
         anticipation of or in connection with such Business Combination or
         otherwise; and

                  (v) A proxy or information statement describing the proposed
         Business Combination and complying with the requirements of the
         Securities Exchange Act of 1934 and the rules and regulations
         thereunder (or any subsequent provisions replacing such Act, rules or
         regulations) shall be mailed to public stockholders of the corporation
         at least 30 days prior to the consummation of such Business Combination
         (whether or not such proxy or information statement is required to be
         mailed pursuant to such Act or subsequent provisions).

         2. For purposes of this Article Tenth:

         (a) The term "Business Combination" shall mean any (i) merger or
consolidation of this corporation or a Subsidiary (as hereinafter defined) of
this corporation with a Related Person or any other corporation which is or
after such merger or consolidation would be an "Affiliate" or "Associate" (as
hereafter defined) of a Related Person, (ii) sale, lease, exchange, mortgage,
pledge, transfer or other disposition (in one transaction or a series of
transactions) with any Related Person or any Affiliate or Associate of any
Related Person, of all or any "Substantial Part" (as hereinafter defined) of the
assets of this corporation or of a Subsidiary of this corporation to a Related
Person or any Affiliate or Associate of any Related Person, (iii) adoption of
any plan or proposal for the liquidation or dissolution of this corporation
proposed by or on behalf of a Related Person or any Affiliate or Associate of
any Related Person, (iv) sale, lease, exchange or other disposition, including
without limitation a mortgage or other security device, of all or any
Substantial Part of the assets of a Related Person or any Affiliate or Associate
of any Related Person to this corporation or a Subsidiary of this corporation,
(v) issuance or pledge of securities of this corporation or a Subsidiary of this
corporation to or with a Related Person or any Affiliate or Associate of any
Related Person, (vi) reclassification of securities (including any reverse stock
split) or recapitalization of this corporation or any other transaction that
would have the effect, either directly or indirectly, of increasing the
proportionate share of any class of equity or convertible securities of this
corporation or any subsidiary of this corporation which is directly or
indirectly beneficially owned by any Related Person or any Affiliate or
Associate of any Related Person, and (vii) agreement, contract or other
arrangement providing for any of the transactions described in this definition
of Business Combination.

                                        4



EXHIBIT 3.1

         (b) The term "person" shall mean any individual, firm, corporation or
other entity and shall include any group comprised of any person and any other
person with whom such person or any Affiliate or Associate of such person has
any agreement, arrangement or understanding, directly or indirectly, for the
purpose of acquiring, holding, voting or disposing of Voting Stock of this
corporation.

         (c) The term "Related Person" shall mean any person (other than this
corporation, or any Subsidiary and other than any profit-sharing, employee stock
ownership or other employee benefit plan of this corporation or any Subsidiary
or any trustee of or fiduciary with respect to any such plan when acting in such
capacity) who or which:

                  (i) is the beneficial owner (as hereinafter defined) of ten
         percent (10 %) or more of the Voting Stock;

                  (ii) is an Affiliate or Associate of this corporation and at
         any time within the two-year period immediately prior to the date in
         question was the beneficial owner of ten percent (10%) or more of the
         Voting Stock; or

                  (iii) is an assignee of or has otherwise succeeded to the
         beneficial ownership of any shares of Voting Stock which were at any
         time within the two-year period immediately prior to such time
         beneficially owned by any Related Person, if such assignment or
         succession shall have occurred in the course of a transaction or series
         of transactions not involving a public offering within the meaning of
         the Securities Act of 1933.

         (d) A person shall be a "beneficial owner" of any Voting Stock:

                  (i) which such person or any of its Affiliates or Associates
         beneficially owns, directly or indirectly;

                  (ii) which such person or any of its Affiliates or Associates
         has, directly or indirectly, (a) the right to acquire (whether such
         right is exercisable immediately or only after the passage of time),
         pursuant to any agreement arrangement or understanding or upon the
         exercise of conversion rights, exchange rights, warrants or options, or
         otherwise, or (b) the right to vote pursuant to any agreement,
         arrangement or understanding; or

                  (iii) which are beneficially owned, directly or indirectly, by
         any other person with which such person or any of its Affiliates or
         Associates has any agreement, arrangement or understanding for the
         purpose of acquiring, holding, voting or disposing of any shares of
         Voting Stock.

         (e) For the purposes of determining whether a person is a Related
Person pursuant to sub-paragraph (c) of this paragraph 2, the number of shares
of Voting Stock deemed to be outstanding shall include shares deemed owned
through application of sub-paragraph (d) of this paragraph 2 but shall not
include any other shares of Voting Stock which may be issuable pursuant to any
agreement, arrangement or understanding, or upon exercise of conversion rights,
warrants or option, or otherwise.

                                        5



EXHIBIT 3.1

         (f) The terms "Affiliate" or "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as in effect on January
1, 1985.

         (g) The term "Subsidiary" means any corporation of which a majority of
any class of equity securities is owned, directly or indirectly, by this
corporation; provided, however, that for the purposes of the definition of
Related Person set forth in sub-paragraph (c) of this paragraph 2, the term
"Subsidiary" shall mean only a corporation of which a majority of each class of
equity securities is owned, directly or indirectly, by this corporation.

         (h) The term "Continuing Director" means any member of the Board of
Directors, while such person is a member of the Board of Directors, who is not
an Affiliate, Associate or a representative of the Related Person involved in a
proposed Business Combination and was a member of the Board of Directors prior
to the time that the Related Person became a Related Person, and any successor
of a Continuing Director, while such successor is a member of the Board of
Directors, who is not an Affiliate, Associate or a representative of the Related
Person and is recommended or elected to succeed a Continuing Director by a
majority of Continuing Directors. Each initial director of this corporation
elected by the incorporator of this corporation shall be a Continuing Director
for purposes of this Article Tenth.

         (i) The term "Substantial Part" shall mean more than twenty percent
(20%) of the Fair Market Value, as determined by a majority of the Continuing
Directors, of the total consolidated assets of this corporation and its
Subsidiaries taken as a whole as of the end of its most recent fiscal year ended
prior to the time the determination is being made.

         (j) For the purposes of paragraph 1(b) (i) of this Article Tenth, the
term "other consideration to be received" shall include, without limitation,
capital stock retained by the shareholders.

         (k) The term "Voting Stock" shall mean all of the outstanding shares of
Common Stock and the outstanding shares of Preferred Stock entitled to vote on
each matter on which the holders of record of Common Stock shall be entitled to
vote, and each reference to a proportion of shares of Voting Stock shall refer
to such proportion of the votes entitled to be cast by such shares voting as one
class.

         (l) The term "Fair Market Value" means: (i) in case of capital stock,
the highest closing sale price during the 30-day period immediately preceding
the date in question of a share of such stock on the Composite Tape for the New
York Stock Exchange Listed Stocks, or, if such stock is not quoted on the
Composite Tape, on the New York Stock Exchange, or if such stock is not listed
on such Exchange, on the principal United States securities exchange registered
under the Securities Exchange Act of 1934 on which such stock is listed, or, if
such stock is not listed on any such stock exchange, the highest closing bid
quotation with respect to a share of such stock during the 30-day period
preceding the date in question on the National Association of Securities
Dealers, Inc. Automated Quotations System or any successor system then in use,
or if no such quotations are available, the fair market value on the date in
question of a share of such stock as determined in good faith by a majority of
the Continuing Directors; and (ii) in the case of

                                        6



EXHIBIT 3.1

property other than cash or stock, the fair market value of such property on the
date in question as determined in good faith by a majority of the Continuing
Directors.

         (m) A Related Person shall be deemed to have acquired a share of the
Voting Stock of this corporation at the time when such Related Person became the
beneficial owner thereof. If a majority of the Continuing Directors is not able
to determine the price at which a Related Person has acquired a share of Voting
Stock of this corporation, such price shall be deemed to be the Fair Market
Value of the shares in question at the time when the Related Person becomes the
beneficial owner thereof. With respect to shares owned by Affiliates, Associates
or other persons whose ownership is attributed to a Related Person under the
foregoing definition of Related Person, the price deemed to be paid therefor by
such Related Person shall be the price paid upon the acquisition thereof by such
Affiliate, Associate or other person, or, if such price is not determinable by a
majority of the Continuing Directors, the Fair Market Value of the shares in
question at the time when the Affiliate, Associate, or other such person became
the beneficial owner thereof.

         3. The fact that any Business Combination complies with the provisions
of paragraph 1(b) of this Article Tenth shall not be construed to impose any
fiduciary duty, obligation or responsibility on the Board of Directors, or any
member thereof, to approve such Business Combination or recommend its adoption
or approval to the shareholders of this corporation, nor shall such compliance
limit, prohibit or otherwise restrict in any manner the Board of Directors, or
any member thereof, with respect to evaluations of or actions and responses
taken with respect to such Business Combination.

         4. A majority of the Continuing Directors of the corporation shall have
the power and duty to determine for the purposes of this Article Tenth, on the
basis of information known to them after reasonable inquiry, (A) whether a
person is a Related Party, (B) the number of shares of Voting Stock beneficially
owned by any person, and (C) whether a person is an Affiliate or Associate of
another. A majority of the Continuing Directors of the corporation shall have
the further power to interpret all of the terms and provisions of this Article
Tenth.

         ELEVENTH: Advance notice of stockholder nominations for the election of
directors shall be given in the manner provided in the by-laws of this
corporation.

         TWELFTH: (a) Newly created directorships resulting from any increase in
the number of directors and any vacancies on the Board of Directors resulting
from death, resignation, disqualification, removal or other cause shall be
filled by the affirmative vote of a majority of the remaining directors then in
office (and not by Stockholders), even though less than a quorum of the Board of
Directors. Any Director elected in accordance with the preceding sentence shall
hold office until the next election of directors by the stockholders and until
such director's successor shall have been elected and qualified. No decrease in
the number of Directors constituting the Board of Directors shall shorten the
term of any incumbent director.

         (b) Any director may be removed from office by the affirmative vote of
the holders of 70% of the outstanding stock of the corporation entitled to vote
generally in the election of directors, provided that such removal is for cause.

                                        7



EXHIBIT 3.1

         THIRTEENTH: The corporation reserves the right to amend, alter, change
or repeal any provision contained in this Certificate of Incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred on
stockholders herein are granted subject to this reservation. Notwithstanding the
foregoing, the provisions set forth in Articles SIXTH, SEVENTH, EIGHTH, NINTH,
TENTH, ELEVENTH, TWELFTH and this Article THIRTEENTH may not be repealed or
amended in any respect unless such repeal or amendment is approved by the
affirmative vote of not less than seventy percent (70 %) of the total voting
power of all outstanding shares of stock in this corporation entitled to vote
thereon.

         FOURTEENTH: No director of the corporation shall be personally liable
to the corporation or any stockholder for monetary damages for breach of
fiduciary duty as a director, except for any matter in respect of which such
director shall be liable under Section 174 of the General Corporation Law of the
State of Delaware or any amendment thereto or shall be liable by reason that, in
addition to any and all other requirements for such liability, such director (i)
shall have breached the duty of loyalty to the corporation or its stockholders,
(ii) shall not have acted in good faith, or, in failing to act, shall not have
acted in good faith, (iii) shall have acted in a manner involving intentional
misconduct or a knowing violation of law or, in failing to act, shall have acted
in a manner involving intentional misconduct or a knowing violation of law or
(iv) shall have derived an improper personal benefit. Neither the amendment nor
repeal of this Article Fourteenth, nor the adoption of any provision of this
certificate of incorporation inconsistent with this Article Fourteenth, shall
eliminate or reduce the effect of this Article Fourteenth in respect of any
matter occurring, or any cause of action, suit or claim that, but for this
Article Fourteenth would accrue or arise, prior to such amendment repeal or
adoption of an inconsistent provision.

                                        8



EXHIBIT 3.1

                      CERTIFICATE OF DESIGNATION AND TERMS
                        OF PARTICIPATING PREFERRED STOCK
                                       OF
                           ABM INDUSTRIES INCORPORATED

                     Pursuant to Section 151 of the General
                    Corporation Law of the State of Delaware

                  We, the undersigned, William W. Steele and Harry H. Kahn, the
President and Secretary, respectively, of ABM Industries Incorporated, a
Delaware corporation (the "Corporation"), do hereby certify as follows:

                  Pursuant to authority granted by Article Fifth of the
Certificate of Incorporation, as amended, of the Corporation and in accordance
with the provisions of Section 151 of the General Corporation Law of the State
of Delaware, the Board of Directors of the Corporation has adopted the following
resolutions fixing the designation and certain terms, powers, preferences and
other rights of a new series of the Corporation's Preferred Stock, par value
$.01 per share, and certain qualifications, limitations and restrictions
thereon:

                           RESOLVED, that there is hereby established a series
         of Preferred Stock, par value $.01 per share, of the Corporation, and
         the designation and certain terms, powers, preferences and other rights
         of the shares of such series, and certain qualifications, limitations
         and restrictions thereon, are hereby fixed as follows:

                           (i) The distinctive serial designation of this series
                  shall be "Participating Preferred Stock" (hereinafter called
                  "this Series"). Each share of this Series shall be identical
                  in all respects with the other shares of this Series except as
                  to the dates from and after which dividends thereon shall be
                  cumulative.

                           (ii) The number of shares in this Series shall
                  initially be 50,000, which number may from time to time be
                  increased or decreased (but not below the number then
                  outstanding) by the Board of Directors. Shares of this Series
                  purchased by the Corporation shall be cancelled and shall
                  revert to authorized but unissued shares of Preferred Stock
                  undesignated as to series. Shares of this Series may be issued
                  in fractional shares, which fractional shares shall entitle
                  the holder, in proportion to such holder's fractional share,
                  to all rights of a holder of a whole share of this Series.

                           (iii) The holders of full or fractional shares of
                  this Series shall be entitled to receive, when and as declared
                  by the Board of Directors, but only out of funds legally
                  available therefor, dividends, (A) on each date that dividends
                  or other distributions (other than dividends or distributions
                  payable in Common Stock of the Corporation) are payable on or
                  in respect of Common Stock comprising part of the Reference
                  Package (as defined below), in an amount per whole share of
                  this Series equal to the aggregate amount of dividends or
                  other

                                        9



EXHIBIT 3.1

                  distributions (other than dividends or distributions payable
                  in Common Stock of the Corporation) that would be payable on
                  such date to a holder of the Reference Package (as hereinafter
                  defined) and (B) on the last day of March, June, September and
                  December in each year, in an amount per whole share of this
                  Series equal to the excess (if any) of $2.50 over the
                  aggregate dividends paid per whole share of this Series during
                  the three month period ending on such last day. Each such
                  dividend shall be paid to the holders of record of shares of
                  this Series on the date, not exceeding sixty days preceding
                  such dividend or distribution payment date, fixed for the
                  purpose by the Board of Directors in advance of payment of
                  each particular dividend or distribution. Dividends on each
                  full and each fractional share of this Series shall be
                  cumulative from the date such full or fractional share is
                  originally issued; provided that any such full or fractional
                  share originally issued after a dividend record date and on or
                  prior to the dividend payment date to which such record date
                  relates shall not be entitled to receive the dividend payable
                  on such dividend payment date or any amount in respect of the
                  period from such original issuance to such dividend payment
                  date.

                           The term "Reference Package" shall initially mean
                  1,000 shares of Common Stock, $.01 par value per share
                  ("Common Stock"), of the Corporation. In the event the
                  Corporation shall at any time after the close of business on
                  April 22, 1998 (A) declare of pay a dividend on any Common
                  Stock payable in Common Stock, (B) subdivide any Common Stock
                  or (C) combine any Common Stock into a smaller number of
                  shares, then and in each such case the Reference Package after
                  such event shall be the Common Stock that a holder of the
                  Reference Package immediately prior to such event would hold
                  thereafter as a result thereof.

                           Holders of shares of this Series shall not be
                  entitled to any dividends, whether payable in cash, property
                  or stock, in excess of full cumulative dividends, as herein
                  provided on this Series.

                           So long as any shares of this series are outstanding,
                  no dividends (other than a dividend in Common Stock or in any
                  other stock ranking junior to this Series as to dividends and
                  upon liquidation) shall be declared or paid or set aside for
                  payment or other distribution declared or made upon the Common
                  Stock or upon any other stock ranking junior to this Series as
                  to dividends or upon liquidation, nor shall any Common Stock
                  nor any other stock of the Corporation ranking junior to or on
                  a parity with this Series as to dividends or upon liquidation
                  be redeemed, purchased or otherwise acquired for any
                  consideration (or any moneys be paid to or made available for
                  a sinking fund for the redemption of any shares of any such
                  stock) by the Corporation (except by conversion into or
                  exchange for stock of the Corporation ranking junior to this
                  Series as to dividends and upon liquidation), unless, in each
                  case, the full cumulative dividends (including the dividend to
                  be due upon payment of such dividend, distribution,
                  redemption, purchase or other acquisition) on all outstanding
                  shares of this Series shall have been, or shall
                  contemporaneously be, paid.

                                       10



EXHIBIT 3.1

                           (iv) In the event of any merger, consolidation,
                  reclassification or other transaction in which the shares of
                  Common Stock are exchanged for or changed into other stock or
                  securities, cash and/or any other property, then in any such
                  case the shares of this Series shall at the same time be
                  similarly exchanged or changed in an amount per whole share
                  equal to the aggregate amount of stock, securities, cash
                  and/or any other property (payable in kind), as the case may
                  be, that a holder of the Reference Package would be entitled
                  to receive as a result of such transaction.

                           (v) In the event of any liquidation, dissolution or
                  winding up of the affairs of the Corporation, whether
                  voluntary or involuntary, the holders of full and fractional
                  shares of this Series shall be entitled, before any
                  distribution or payment is made on any date to the holders of
                  the Common Stock or any other stock of the Corporation ranking
                  junior to this Series upon liquidation, to be paid in full an
                  amount per whole share of this Series equal to the greater of
                  (A) $100 or (B) the aggregate amount distributed or to be
                  distributed prior to such date in connection with such
                  liquidation, dissolution or winding up to a holder of the
                  Reference Package (such greater amount being hereinafter
                  referred to as the "Liquidation Preference"), together with
                  accrued dividends to such distribution or payment date,
                  whether or not earned or declared. If such payment shall have
                  been made in full to all holders of shares of this Series, the
                  holders of shares of this Series as such shall have no right
                  or claim to any of the remaining assets of the Corporation.

                           In the event the assets of the Corporation available
                  for distribution to the holders of shares of this Series upon
                  any liquidation, dissolution or winding up of the Corporation,
                  whether voluntary or involuntary, shall be insufficient to pay
                  in full all amounts to which such holders are entitled
                  pursuant to the first paragraph of this Section (v), no such
                  distribution shall be made on account of any shares of any
                  other class or series of Preferred Stock ranking on a parity
                  with the shares of this Series upon such liquidation,
                  dissolution or winding up unless proportionate distributive
                  amounts shall be paid on account of the shares of this Series,
                  ratably in proportion to the full distributable amounts for
                  which holders of all such parity shares are respectively
                  entitled upon such liquidation, dissolution or winding up.

                           Upon the liquidation, dissolution or winding up of
                  the Corporation, the holders of shares of this Series then
                  outstanding shall be entitled to be paid out of assets of the
                  Corporation available for distribution to its Stockholders all
                  amounts to which such holders are entitled pursuant to the
                  first paragraph of this Section (v) before any payment shall
                  be made to the holders of Common Stock or any other stock of
                  the Corporation ranking junior upon liquidation to this
                  Series.

                           For the purposes of this Section (v), the
                  consolidation or merger of, or binding share exchange by, the
                  Corporation with any other corporation shall not

                                       11



EXHIBIT 3.1

                  be deemed to constitute a liquidation, dissolution or winding
                  up of the Corporation.

                           (vi) The shares of this Series shall not be
                  redeemable.

                           (vii) In addition to any other vote or consent of
                  Stockholders required by law or by the Restated Certificate of
                  Incorporation, as amended, of the Corporation, each whole
                  share of this Series shall, on any matter, vote as a class
                  with any other capital stock comprising part of the Reference
                  Package and voting on such matter and shall have the number of
                  votes thereon that a holder of the Reference Package would
                  have.

                  IN WITNESS WHEREOF, the undersigned have signed and attested
this certificate on the 17th day of March, 1998.

                                                  /s/ William W. Steele
                                        ----------------------------------------
                                                        President
                                                    William W. Steele

Attest:

        /s/ Harry H. Kahn
- --------------------------------
            Secretary
          Harry H. Kahn

                                       12

                                                                               .
                                                                               .
                                                                               .

EXHIBIT 10.17

                           ABM INDUSTRIES INCORPORATED

                           SERVICE AWARD BENEFIT PLAN

                        AS AMENDED AS OF JANUARY 1, 2003



ARTICLE                                                                  COMMENCING
NUMBER DESCRIPTION                                                         ON PAGE
- -----------------------------------------------------------------------------------
                                                                      
1. NAME, EFFECTIVE DATE, PURPOSE AND CONSTRUCTION ..................         1-1

2. DEFINITIONS......................................................         2-1

3. ELIGIBILITY, PARTICIPATION AND BENEFICIARY DESIGNATION ..........         3-1

4. BENEFITS ........................................................         4-1

5. FORFEITURES OF BENEFITS .........................................         5-1

6. PARTICIPANTS' ACCOUNTS ..........................................         6-1

7. DISTRIBUTION OF BENEFITS ........................................         7-1

8. FIDUCIARY RESPONSIBILITY ........................................         8-1

9. ADMINISTRATIVE COMMITTEE ........................................         9-1

10. AMENDMENT AND TERMINATION ......................................        10-1




EXHIBIT 10.17

                                       1-1

                           ABM INDUSTRIES INCORPORATED

                           SERVICE AWARD BENEFIT PLAN

                                    ARTICLE 1

                 NAME, EFFECTIVE DATE, PURPOSE AND CONSTRUCTION

1.1      Plan Name

         The Plan set forth in this document shall be designated the ABM
         Industries Incorporated Service Award Benefit Plan.

1.2      Effective Date

         The Effective Date of this Plan was November 1, 1989. This document
         reflects amendments and changes made through January 1, 1991.

1.3      Purpose

         The Plan is intended to qualify as a severance pay plan described in
         Department of Labor Regulations 2510.3-1 (a) (2) and 2510.3-2 (b) and
         is intended to be treated as a employee welfare plan under ERISA. The
         Plan is intended to provide benefits to terminating employees based
         upon their loyal and dedicated service to the Company and its
         Affiliates.

1.4      Construction

         The following miscellaneous provisions shall apply in the construction
         of this Plan document:

         (a)      State Jurisdiction

                  All matters respecting the validity, effect, interpretation
                  and administration of this Plan shall be determined in
                  accordance with the laws of the State of California except
                  where preempted by ERISA or other federal statutes.

         (b)      Gender

                  Wherever appropriate, words used in the singular may include
                  the plural or the plural may be read as the singular, the
                  masculine may include the feminine, and the neuter may include
                  both the masculine and the feminine.

         (c)      Application of References to Law

                  All references to sections of ERISA, or the Internal Revenue
                  Code, other federal or state statutes, any regulations or
                  rulings thereunder, shall be deemed to refer to such sections
                  as they may subsequently be modified, amended, replaced or
                  amplified by any federal statutes, regulations or rulings of
                  similar application and import enacted by the Government of
                  the United States, any duly authorized agency of the United
                  States Government, any State Government or duly authorized
                  agency thereunder.



EXHIBIT 10.17

                                       1-2

         (d)      Enforceable Provisions Remain Effective

                  If any provision of this Plan shall be held by a court of
                  competent jurisdiction to be invalid or unenforceable, the
                  remaining provisions of this Plan shall continue to be fully
                  effective.

         (e)      Headings

                  Headings are inserted for reference only and constitute no
                  part of the construction of this Plan.

1.5      Employment Relationship Not Affected

         Nothing in this Plan document shall be deemed a contract between the
         Employer and any Employee, nor shall the rights or obligations of the
         Employer or any Employee to continue or terminate employment at any
         time be affected hereby.



EXHIBIT 10.17

                                       2-1

                                    ARTICLE 2

                                   DEFINITIONS

2.1      "Account" means the aggregate of all records maintained by the
         Committee for purposes of determining a Participant's or Beneficiary's
         benefits under the Plan.

2.2      "Affiliated Employer" means any corporation which is so designated by
         the Board, which may include any corporation or business determined to
         be affiliated under Code Section 414 or any other corporation or
         business which is affiliated to some degree with the Employer.

2.3      "Award Date" means October 31, 1990, each succeeding October 31 and any
         other date elected by the Board at its discretion. Effective January 1,
         1991, "Award Date" shall mean December 31, 1991 and each succeeding
         December 31.

2.4      "Beneficiary" means any person designated by a Participant.

2.5      "Board" shall mean the Board of Directors of the Employer.

2.6      "Code" means the Internal Revenue code of 1986, as amended (and
         regulations issued thereunder).

2.7      "Committee" means the Administrative Committee designated under Article
         9.

2.8      "Compensation" for any calendar year means all amounts paid to the
         Employee and reported as wages on the Employee's form W-2 for the year
         for services rendered for the Employer or Affiliated Employers during
         the calendar year, and all amounts which an Employee elected to have
         the Employer or Affiliated Employer contribute on his behalf to the ABM
         401(k) and Profit Sharing Plan or the ABM Deferred Compensation Plan
         for the calendar year. Compensation in excess of $175,000 shall not be
         considered in the calculation of benefits; provided, however, the
         $175,000 limit shall not replace any limit in place for any year prior
         to 1996 under this Plan.

2.9      "Date of Eligibility" shall mean (1) for Eligible Employees hired after
         October 31, 1989, the date on which the Employee first performs any
         service for the Employer, (2) for Eligible Employees employed on or
         before October 31, 1989, November 1, 1989. Effective January 1, 1992,
         "Date of Eligibility" shall mean the January 1 following the date on
         which the Employee has Compensation in excess of $50,000, or such other
         dollar amount as the Committee may from time to time announce.

2.10     "Date of Hire" shall mean the date on which the Employee becomes an
         employee of the Employer or an Affiliated Employer within the meaning
         of Code Section 3121(d).



EXHIBIT 10.17

                                       2-2

2.11     "Disability" shall mean the permanent incapacity of a Participant, by
         reason of physical or mental illness, to perform his usual duties for
         the Employer, resulting in termination of his service with the Employer
         or any Affiliated Employer. Disability shall be determined by the
         Committee in a uniform and nondiscriminatory manner after consideration
         of such evidence as it may require, which shall include a report of
         such physician or physicians as it may designate.

2.12     "Eligible Employee" shall have the meaning as defined in Article 3.

2.13     "Eligible Participant" shall mean:

         (a)      An Eligible Employee who was employed continuously throughout
                  the Fiscal Year, or

         (b)      an Eligible Employee who terminated employment during the
                  Fiscal Year due to death, disability or after having reached
                  his Normal Retirement Date.

2.14     "Employee" means any person considered under the rules of common law or
         appropriate statute to be employed by the Employer or an Affiliated
         Employer, except:

         (a)      Employees whose wages are determined by collective bargaining
                  agreements,

         (b)      Employee Employees who are receiving pension contributions
                  under a union retirement plan, and

         (c)      Contract workers of the Employer or an Affiliated Employer who
                  are employed to perform principally manual work, including but
                  not limited to elevator operator, janitor, security worker,
                  guard, window washer, stationary engineer, painter,
                  warehouseman, driver, parking attendant, mechanic,
                  electrician, laundry worker or service technician.

2.15     "Employer" means ABM Industries Incorporated, a Delaware corporation,
         and such of its successors or assigns as may expressly adopt this Plan
         and agree in writing to continue this Plan.

2.16     "Entry Date" means November 1, 1989, and each succeeding November 1.
         Effective January 1, 1991, "Entry Date" means January 1 and each
         succeeding January 1.

2.17     "ERISA" means the Employee Retirement Income Security Act of 1974, as
         amended.

2.18     "Fiscal Year" means the accounting year of the Plan, which is the
         12-month period ending October 31. Effective January 1, 1991, "Fiscal
         year" means the 12-month period ending December 31.

2.19     "Normal Retirement Date" means the date of the Participant's 62nd
         birthday.

2.20     "Participant" means any Employee who has entered the Plan and been
         credited with Service Award Benefits but has not yet had such benefits
         distributed.



EXHIBIT 10.17

                                       2-3

2.21     "Plan" means the arrangement created by this document.

2.22     "Plan Administrator" means the Administrative Committee, discussed in
         Article 9.

2.23     "Restricted Employee" shall mean all officers, managers and sales
         persons of the Employer or an Affiliated Employer.

2.24     "Service Award Benefit" means the benefit calculated under Section 4.2.



EXHIBIT 10.17

                                       3-1

                                    ARTICLE 3

             ELIGIBILITY, PARTICIPATION AND BENEFICIARY DESIGNATION

3.1      Definitions

         (a)      "Eligible Employee" means any Employee of the Employer or an
                  Affiliated Employer whose Compensation is $50,000 or greater
                  in any calendar year. The $50,000 dollar amount may be
                  adjusted from time to time as the Plan Administrator may deem
                  necessary. The foregoing notwithstanding, an Employee shall
                  not be an Eligible Employee during any Fiscal Year the
                  Employee is also eligible to receive contributions under or
                  make 401(k) contributions to the ABM 401(k) and Profit Sharing
                  Plan.

3.2      Participation

         (a)      Initial Participants

                  Employees who are Eligible Employees as of October 31, 1989
                  shall become Participants as of November 1, 1989.

         (b)      Newly Hired Employees

                  Employees who are hired after October 31, 1989, shall become
                  Participants as of the first November 1, or such earlier date,
                  after certification by the Committee that the Employee is an
                  Eligible Employee. Employees hired after January 1, 1991 shall
                  become Participants as of the first January 1, or such earlier
                  date, after certification by the Committee that the Employee
                  is an Eligible Employee.

         (c)      Other Employees

                  Other Employees shall become Participants as of the first
                  November 1, or such earlier date, after certification by the
                  Committee that the Employee is an Eligible Employee. Effective
                  January 1, 1991,the November 1 participation date in this
                  Article shall be changed to January 1.

         (d)      Rehired Employees

                  A rehired Employee shall be treated as an Employee hired after
                  October 31, 1989, unless the Employee was a Participant in the
                  Plan. Section 2.16 of the Plan notwithstanding, former Plan
                  Participants shall renew their participation in the Plan as of
                  the July 1 or January 1 coinciding with or next following
                  their date of rehire provided they are otherwise eligible for
                  the Plan.

3.3      Beneficiary Designation

         (a)      Designation Procedure

                  Each Eligible Employee, upon becoming a Participant shall
                  designate a Beneficiary or Beneficiaries to receive benefits
                  under the Plan after his death. A Participant may change his
                  beneficiary designation at any time. Each beneficiary
                  designation shall be in a form prescribed by the Committee and
                  will be effective only when filed with the Committee during
                  the Participant's lifetime. Each beneficiary designation filed
                  with the Committee will cancel all previously filed
                  Beneficiary designations.



EXHIBIT 10.17

         (b)      Lack of Designation

                  In the absence of a valid designation, the Participant's
                  benefits under the Plan shall be distributed to the
                  Participant's surviving spouse, or if there is no surviving
                  spouse to the Participant's estate.

3.4      Committee Determines Eligibility

         Compliance with the eligibility requirements shall be determined by the
         Committee, which shall also inform each Eligible Employee of his
         becoming a Participant. The Committee shall provide each participant
         with a summary plan description in compliance with ERISA and
         regulations thereunder.



EXHIBIT 10.17

                                       4-1

                                    ARTICLE 4

                                    BENEFITS

4.1      Credits for Service Award Benefits

         (a)      On each Award Date, commencing October 31, 1990, the Board
                  shall Credit the Account of each Eligible Participant with 7
                  days, to be used in the calculation of Benefits under Article
                  4.2. For the short Fiscal Year beginning October 1, 1991 and
                  ending December 31, 1991, the Board shall determine the number
                  of days to be credited to each Eligible Participant, if any.

         (b)      In addition to (a) above, on each Award Date, commencing
                  October 31, 1990, the Board may, in it's sole discretion,
                  designate an additional number of days to be credited to the
                  Account of each Eligible Participant.

         (c)      If an employee reenters the Plan on July 1 of any year, the
                  Employee/Participant shall be to 1/2 the number of days
                  awarded under (a) and (b) above to other Employees who
                  participated for the entire year.

4.2      Calculation of Service Award Benefit

         Upon termination of employment, the Committee shall determine the
         benefit payable to the Participant. The benefit shall be equal to the
         number of days credited to the Account of the eligible Employee
         multiplied by the average annual Compensation received in the three
         full calendar years of full-time employment preceding the year of
         termination converted to a daily rate of pay. For purposes of this
         calculation, a year shall consist of 260 days.

4.3      Limitation on Benefits

         In no event shall the benefits payable under this Plan combined with
         the benefits under the severance pay plan of the Employer, as described
         in Chapter 3, III, (b) of the ABMI Personnel Policy and Procedure
         Manual, as it may be amended or revised from time to time, exceed two
         times the Compensation received by the Participant in the twelve month
         period preceding the Participant's termination from employment.



EXHIBIT 10.17

                                       5-1

                                    ARTICLE 5

                             FORFEITURES OF BENEFITS

5.1      Forfeiture for Short Service

         A Participant who terminates employment prior to completing 5 full
         years of service, measured from the Employee's Date of Hire, for the
         Employer or an Affiliated Employer shall forfeit all benefits under
         this Plan. A Participant will be credited with one year of service for
         each 12 month period of continuous employment wit the Employer or an
         Affiliated Employer.

5.2      Exceptions

         (a)      Death

                  Notwithstanding Article 5.1 above, a Participant's benefits
                  under this Plan shall not be forfeitable if the termination of
                  employment is due to the death of the Participant.

         (b)      Disability

                  Notwithstanding Article 5.1 above, a Participant's benefits
                  under this Plan shall not be forfeitable upon a finding by the
                  Committee that the Participant's termination of employment is
                  due to Disability defined in Article 2.11.

         (c)      Normal Retirement

                  Notwithstanding Article 5.1 above, a Participant's benefits
                  under this Plan shall not be forfeited if the Participant's
                  termination occurs after the Participant's Normal Retirement
                  Date under this Plan.

         (d)      Notwithstanding Article 5.1 above, if a Participant's
                  employment is terminated by action of the Employer as part of
                  the divestiture of Amtech Elevator Services, the Participant's
                  Account under the Plan shall become fully vested on the
                  closing of the divestiture transaction.

5.3      Unallocatable Participants

         If all or any portion of a Participant's benefits become payable under
         this Plan, and the Committee after a reasonable search cannot locate
         the Participant or his Beneficiary (if such Beneficiary is entitled to
         payment) the Account shall be Forfeited as of the end of the third
         Fiscal Year following the Participant's termination from employment.

5.4      Forfeiture for Cause

         A Participant who is terminated from employment because of theft,
         defalcation, or embezzlement from the Employer, an Affiliated Employer,
         or a customer or client of either the Employer or an Affiliated
         Employer, shall forfeit all benefits under this Plan.



EXHIBIT 10.17

                                       6-1

                                    ARTICLE 6

                              PARTICIPANTS ACCOUNTS

6.1      Service Award Account

         The Committee shall maintain an accounting of the number of days and
         weeks, or portions thereof, awarded to each Participant along with a
         record of the Compensation received by the Participant for the current
         calendar year and the two preceding calendar years.

6.2      Statement of Accounts

         At least annually, the Committee will provide the Participant with a
         statement of the status of the Participant's Account and the record of
         Compensation in that Account. In the event of any error, the
         Participant is entitled to request the Committee to correct either the
         number of days or weeks credited, or the Compensation credited.



EXHIBIT 10.17

                                       7-1

                                    ARTICLE 7

                            DISTRIBUTION OF BENEFITS

7.1      General

         Benefits under the Plan are paid solely from the assets of the
         Employer. This Plan document grants the Participants no greater right
         to the assets of the Employer and Affiliated Employers than that
         enjoyed by any unsecured creditor of the Employer and Affiliated
         employers.

7.2      Administrative Rules

         (a)      Authority

                  Distributions to Participants shall be made only in accordance
                  with the directions of the Committee, which shall be governed
                  by the terms of this Plan documents.

         (b)      Claims

                  A Participant's Beneficiary has the right to file a claim for
                  benefits as set forth in Article 9.7.

7.3      Timing and Amount of Distributions

         (a)      Restricted Employees

                  A Participant who is a Restricted Employee shall receive his
                  benefits in two payments from the Plan. The first payment,
                  equal to 1/2 of the total benefit due, will be made in the
                  eleventh month following the Participant's termination from
                  employment. The second payment, equal to 1/2 of the total
                  benefit due, will be made no later than the last day of the
                  23rd month following the Participant's termination from
                  employment. In the event the Employer or Affiliated Employer
                  sells, closes or otherwise disposes of a subsidiary, division
                  or other operating unit which is engaged in a type or line of
                  business in which the Employer or an Affiliated Employer no
                  longer wishes to engage, the Committee shall direct that the
                  Accounts of Restricted Employees shall be payable in one lump
                  sum as soon as administratively possible after the close of
                  the transaction, provided that such payments will not violate
                  any provision of the Code.

         (b)      Other Participants

                  A participant, who is not a Restricted Employee, shall receive
                  his benefits in two payments from the Plan. The first payment,
                  equal to 1/2 of the total benefits, will be paid as soon as
                  administratively possible following the termination of
                  employment by the Participant. The second payment, equal to
                  1/2 of the total benefits, will be paid in the thirteenth
                  month following the Participant's termination from employment.

         (c)      Exceptions

                  The Committee, in its sole discretion, may waive the rules in
                  (a) and (b) in the event of death or Disability of the
                  Participant, or if the Participant, whether a Restricted
                  Employee or not, retires after attaining his Normal Retirement
                  Date. Notwithstanding the foregoing, if the benefit is $5000
                  or less, the Committee may



EXHIBIT 10.17

                                       7-2

                  make a single lump sum payment to the Participant as soon as
                  administratively feasible.



EXHIBIT 10.17

                                       8-1

                                    ARTICLE 8

                            FIDUCIARY RESPONSIBILITY

8.1      Named Fiduciary

         The authority to control and manage the operation and administration of
         the Plan shall be allocated between the Employer, the Affiliated
         Employer and the Committee, all of whom are named fiduciaries under
         ERISA.

8.2      Fiduciary Standards

         Each fiduciary shall discharge its duties with respect to the Plan
         solely in the interest of the Participants and Beneficiaries as
         follows:

                  (1)      For the exclusive purpose of providing benefits to
                           Participants and their Beneficiaries;

                  (2)      With the care, skill, prudence and diligence under
                           the circumstances then prevailing that a prudent man
                           acting in a like capacity and familiar with such
                           matters would use in the conduct of an enterprise of
                           a like character and with like aims;

                  (3)      In accordance with the Plan document.

8.3      Fiduciaries Liable for Breach of Duty

         A fiduciary shall be liable, as provided in ERISA, for any breach of
         his fiduciary responsibilities. In addition, a fiduciary under this
         Plan shall be liable for a breach of fiduciary responsibility of
         another fiduciary under this Plan as provided under ERISA Section 405.

8.4      Fiduciary May Employ Agents

         Any person or group of persons may serve in more than one fiduciary
         capacity with regard to the Plan. A fiduciary, with the consent of the
         Employer, may employ one or more persons to render advice and
         assistance with regard to any function such fiduciary has under the
         Plan. The expenses of such persons shall be paid by the Employer.

8.5      Authority Outlined

         (a)      Employer Authority

                  The Employer has the authority to amend and terminate the
                  Plan, and to appoint and remove members of the Committee.

         (b)      Committee Authority

                  The Committee has the authority to:

                  (1)      Maintain the records of Accounts of the Participants;

                  (2)      Furnish and correct errors in statements of Accounts;

                  (3)      Establish the standards for determining Disability
                           under the Plan;

                  (4)      Construe the Plan document and questions thereunder;
                           and

                  (5)      Employ advisors and assistants.



EXHIBIT 10.17

                                       8-2

8.6      Fiduciaries Not to Engage in Prohibited Transactions

         A fiduciary shall not cause the Plan to engage in a transaction if he
         knows or should know that such transaction constitutes a prohibited
         transaction under ERISA Section 406 or code Section 4975, unless such
         transaction is exempted under ERISA Section 408 or Code Section 4975.



EXHIBIT 10.17

                                       9-1

                                    ARTICLE 9

                            ADMINISTRATIVE COMMITTEE

9.1      Appointment of Administrative Committee

         The Employer shall appoint an Administrative Committee to manage and
         administer this Plan in accordance with the provisions hereof, each
         member to serve for such term as the Employer may designate or until a
         successor member has been appointed or until removed by the Employer.
         Members shall serve without compensation for committee services. All
         reasonable expenses of the Committee shall be paid by the Employer.

9.2      Committee Operating Rules

         The Committee shall act by agreement of a majority of its members,
         either by vote at a meeting or in writing without a meeting. By such
         action, the Committee may authorize one or more members to execute
         documents on its behalf. In the event of a deadlock or other situation
         which prevents agreement of a majority of the Committee members, the
         matter shall be decided by the Employer.

9.3      Duties of Plan Administrator

         The Committee is the Plan Administrator under ERISA and shall have the
         duty and authority to comply with the reporting and disclosure
         requirements of ERISA which are specifically required of the Plan
         Administrator.

9.4      Duties of the Committee

         The Committee shall keep on file a copy of this Plan, including any
         subsequent amendments and the latest annual report required under Title
         I of ERISA for examination by Participants during the business hours.

9.5      Committee Powers

         The Committee has the power and duty to do all things necessary or
         convenient to effect the intent and purpose of this Plan, whether or
         not such powers and duties are specifically set forth herein. Not in
         limitation but in amplification of the foregoing, the Committee shall
         have the power to construe the Plan document and to determine all
         questions hereunder. Decisions of the Committee made in good faith upon
         any matters within the scope or its authority shall be final and
         binding on the Employer, the Affiliated Employers, the Participants,
         their Beneficiaries and all others. The Committee shall at all times
         act in a uniform and nondiscriminatory manner in making and carrying
         out its decisions, and may from time to time prescribe and modify
         uniform rules of interpretation and administration.

9.6      Committee May Retain Advisors

         With the approval of the Employer, the Committee may from time to time
         or on a continuing basis, retain such agents and advisors including,
         specifically, attorneys, accountants, actuaries, consultants and
         administrative assistants, as it considers necessary



EXHIBIT 10.17

                                       9-2

         to assist it in the proper performance of its duties. The expenses of
         such agents or advisors shall be paid by the Employer.

9.7      Claims Procedure

         (a)      Claims Must Be Submitted Within 60 Days

                  The Committee shall determine Participants' and Beneficiaries'
                  rights and benefits under the Plan. In the event of a dispute
                  over benefits, a Participant or Beneficiary may file a written
                  claim for benefits with the Committee, provided that such
                  claim is filed within 60 days of the date the Participant or
                  Beneficiary receives notification of the Committee's
                  determination.

         (b)      Requirements for Notice of Denial

                  If a claim is wholly or partially denied, the Committee shall
                  provide the claimant, setting forth:

                  (i)      The specific reason for the denial;

                  (ii)     Specific references to the pertinent provisions on
                           which the denial is based;

                  (iii)    A description of any additional material or
                           information necessary for the claimant to perfect the
                           claim with an explanation of why such material or
                           information is necessary; and

                  (iv)     Appropriate information as to the steps to be taken
                           if the claimant wishes to submit his or her claim for
                           review.

                  The notice of denial shall be given within a reasonable time
                  period but not later than 90 days of the date the claim is
                  filed, unless special circumstances require an extension of
                  time for processing the claim. If such extension is required,
                  written notice shall be furnished to the claimant within 90
                  days of the date the claim was filed stating the special
                  circumstances requiring an extension of time and the date by
                  which a decision on the claim can be expected, which shall be
                  no more than 180 days from the date the claim was filed. If no
                  notice of denial is provided as herein described, the claimant
                  may appeal the claim as though the claim had been denied.

         (c)      Claimant's Rights if Claim Denied

                  The claimant and/or his representative may appeal the denied
                  claim and may;

                  (i)      Request a review upon written request to the
                           Committee;

                  (ii)     Review pertinent documents; and

                  (iii)    Submit issues and comments in writing; provided that
                           such appeal is made within 60 days of the date the
                           claimant received notification of the denied claim.

         (d)      Time Limit on Review of Denied Claim

                  Upon receipt of a request for review, the committee shall
                  provide written notification of its decision to the claimant
                  stating the specific reasons and referencing specific Plan
                  provisions on which its decision is based, within a reasonable
                  time period but not later than 60 days after receiving the
                  request, unless special circumstances require an extension for
                  processing the review. If such an extension is required, the
                  Committee shall notify the claimant of such special
                  circumstances and of the date, no later than 120 days after
                  the original



EXHIBIT 10.17

                                       9-2

                  date the review was requested, on which the Committee will
                  notify the claimant of its decision.

         (e)      No Legal Recourse Until Claims Procedure Exhausted.

                  In the event of any dispute over benefits under this Plan, all
                  remedies available to the disputing individual under this
                  Article 9.7 must be exhausted before legal recourse of any
                  type is sought.

9.8      Committee Indemnification

         To the fullest extent permitted by law, the Employer agrees to
         indemnify, to defend, and hold harmless the members of the Committee,
         individually and collectively, against any liability whatsoever for any
         (1) action taken or omitted by them in good faith in connection with
         this Plan or their duties hereunder, and (2) expenses or losses for
         which they may become liable as a result of any such actions or
         non-actions, unless resultant from their own willful misconduct. The
         Employer may purchase insurance for the Committee to cover any of their
         potential liabilities with regard to the Plan.



EXHIBIT 10.17

                                      10-1

                                   ARTICLE 10

                            AMENDMENT AND TERMINATION

10.1     Employer May Amend Plan

         The Employer reserves the right to amend the Plan in any manner that it
         may deem advisable by action of the Employer. The Employer, Affiliated
         Employers, Participants and Beneficiaries and all other persons having
         any interest hereunder shall be bound by any such amendment.

10.2     Employer May Terminate Plan

         The Employer has established the Plan with the bona fide intention and
         expectation that the Plan will continue indefinitely, but the Employer
         shall be under no obligation to maintain the Plan for any given length
         of time and may, in its sole discretion, terminate the Plan at any time
         without any liability, except as to the payment of benefits earned
         under this Plan prior to the date this Plan is terminated.

EXHIBIT 10.18                                                        Page 1 of 4

                           ABM INDUSTRIES INCORPORATED

                 2002 PRICE-VESTED PERFORMANCE STOCK OPTION PLAN
                             STOCK OPTION AGREEMENT

         THIS AGREEMENT (the "Agreement") dated as of ____________ day of
_______, 200_, is entered into by and between ABM Industries Incorporated, a
Delaware corporation (the "Company"), and ____________ (the "Optionee").

                                   WITNESSETH

In consideration of the mutual promises and covenants made herein and the mutual
benefits to be derived here from, the parties hereto agree as follows:

1.       Grant of Options.

         Subject to the provisions of this Agreement and the Plan, the Company
         hereby grants to the Optionee the right and option to purchase _____
         shares of the Company's common stock, par value $0.01 per share (the
         "Common Stock") at an exercise price of $__.__ (the "Option").

2.       Exercisability of Options.

         a.       The Option may be exercised only to the extent it is vested.

         b.       The vested portion of the Option may be exercised, in whole or
         in part, at the times and in the manner set forth in the Plan;
         provided, however, that such vested portion shall not be exercised:

                  (1)      before the first (1st) anniversary of the Option's
                           date of grant,

                  (2)      at any one time for fewer than 100 shares, or such
                           number of shares as to which such Option is then
                           exercisable, if such number of shares is less than
                           100, and

                  (3)      on or after the tenth (10th) anniversary of the
                           Option's date of grant.

3.       Vesting of Options.

         a.       Subject to the limitations contained in this Agreement and the
         Plan, unless the vesting of the Option is accelerated as set below, the
         Option shall vest in full on the close of business on the eight (8th)
         anniversary of its date of grant.



EXHIBIT 10.18                                                        Page 2 of 4

         b.       During the four-year period commencing on its date of grant,
         the vesting of the Option shall accelerate at such time as the Fair
         Market Value of the Common Stock shall have been equal to or greater
         than the assigned Vesting Price for ten (10) trading days in any period
         of thirty (30) consecutive trading days. For purposes of this
         paragraph, the "Vesting Price" means the following:

                  (1)      $20.00 for ______ shares of Common Stock subject to
                           the Option.

                  (2)      $22.50 for ______ shares of Common Stock subject to
                           the Option.

                  (3)      $25.00 for ______ shares of Common Stock subject to
                           the Option.

                  (4)      $27.50 for ______ shares of Common Stock subject to
                           the Option.

4.       No Right to Employment.

         Nothing in this Agreement or the Plan shall confer upon the Optionee
         any right to continue in the employ of the Company or any of its
         Affiliates, or interfere in any way with the right of the Company or
         any such Affiliate to terminate such employment with or without cause
         at any time whatsoever absent a written employment contract to the
         contrary. In addition, nothing in this Agreement shall obligate the
         Company or any of its Affiliates, their respective shareholders, board
         of directors, officers or employees to continue any relationship that
         the Optionee might have as a member of the board of directors or
         consultant for the Company or an Affiliate.

5.       Effect of Certain Changes.

         If any change is made to the Common Stock subject to the Option,
         without the receipt of consideration by the Company (through merger,
         consolidation, reorganization, recapitalization, reincorporation, stock
         dividend, dividend in property other than cash, stock split,
         liquidating dividend, combination of shares, exchange of shares, or
         other transaction not involving the receipt of consideration by the
         Company) the Committee shall appropriately adjust the number of shares
         subject to the Options, the exercise price per share and the Vesting
         Price. The Committee's determination shall be final, binding and
         conclusive.

6.       Taxes and Withholding.

         a.       No later than the date of exercise of any portion of the
         Option, and prior to the delivery of any shares of Common Stock to any
         Optionee, the Optionee shall pay to the Company or make arrangements
         satisfactory to the Committee regarding payment of any and all federal,
         state or local taxes of any kind required by law to be withheld upon
         such exercise. To the extent permitted and required by law, the Company
         shall have the right to deduct from any payment of any kind



EXHIBIT 10.18                                                        Page 3 of 4

         otherwise due to the Optionee, any and all federal, state and local
         taxes that may result from the exercise of the Option.

         b.       Optionee agrees that, in the event any governmental taxing
         authority claims that any unpaid taxes, interest or penalties are due
         and owing in connection with the Optionee's exercise of any Stock
         Option granted under the Plan, the Optionee will be solely responsible
         to defend and/or pay any such claim. The Optionee further agrees to
         indemnify and hold the Company harmless from defending and/or paying
         any such claim, including reasonable attorney's fees, in the event that
         any governmental taxing authority seeks payment of any and all such
         unpaid taxes, interest or penalties from the Company.

8.       Notices.

         Any notice to be given under the terms of this Agreement shall be in
         writing and delivered to the Company at 160 Pacific Avenue, Suite 222,
         San Francisco, CA 94111, Attention: General Counsel, and to the
         Optionee at the address set forth on the last page of this Agreement or
         at such other address as either party may hereafter designate in
         writing to the other.

9.       Effect of Agreement.

         Except as otherwise provided hereunder, this Agreement shall be binding
         upon and shall inure to the benefit of any successor(s) of the Company.

10.      Laws Applicable to Construction.

         The law of the State of California shall govern all questions,
         concerning the construction, validity and interpretation of the
         Agreement, without regard to such state's conflict of laws rules.

11.      Interpretation.

         The Option is subject to the all the provisions of the Plan, the
         provisions of which are hereby made a part of the Option, and is
         further subject to all interpretations, amendments, rules and
         regulations which may from time to time be promulgated and adopted
         pursuant to the Plan. In the event of a conflict between the provisions
         of the Option and those of the Plan, the provisions of the Plan shall
         control. In the event of any ambiguity in this Agreement, any term
         which is not defined in this Agreement, or any matters as to which this
         Agreement is silent, the Plan shall govern.



EXHIBIT 10.18                                                        Page 4 of 4

12. Headings.

         The headings of paragraphs herein are included solely for convenience
         of reference and shall not affect the meaning or interpretation of any
         of the provisions of this Agreement.

13. Amendment.

         This Agreement may not be modified, amended or waived in any manner
         except by an instrument in writing signed by both parties hereto. The
         waiver by either party of compliance with any provision of this
         Agreement shall not operate or be construed as a waiver of any other
         provision of this Agreement, or of any subsequent breach by such party
         of a provision of this Agreement.

         IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed on its behalf by a duly authorized officer and the Optionee has
hereunto set his or her hand.

for ABM INDUSTRIES INCORPORATED:

________________________________
Henrik C. Slipsager
President  & CEO

for OPTIONEE:

________________________________

EXHIBIT 10.19                                                        Page 1 of 7

                          ABM INDUSTRIES INCORPORATED

                           EXECUTIVE STOCK OPTION PLAN
                          (as amended December 9, 2003)

                                    ARTICLE 1

                                   Definitions

As used herein, the following terms have the meanings hereinafter set forth
unless the context clearly indicates to the contrary:

         (a)      "Board" shall mean the Board of Directors of the Company.

         (b)      "Committee" shall mean the Compensation Committee of the
                  Board, or such other committee as the Board may designate. The
                  Committee shall consist of not fewer than three members of the
                  Board. Each member of the Committee shall be a "disinterested
                  person" as defined in Rule 16b-3 under the Securities Exchange
                  Act of 1934.

         (c)      "Company" shall mean ABM Industries Incorporated.

         (d)      "Fair Market Value" shall mean the average of the highest
                  price and the lowest price per share at which the Stock is
                  sold in the regular way on the New York Stock Exchange on the
                  day an Option is granted hereunder or, in the absence of any
                  reported sales on such day, the first preceding day on which
                  there were such sales.

         (e)      "Nonemployee Director" shall mean a member of the Board who is
                  neither an employee of the Company nor of any Subsidiary.

         (f)      "Option" shall mean an option to purchase Stock granted to the
                  provisions of Article VI hereof.

         (g)      "Optionee" shall mean an individual to whom an Option has been
                  granted hereunder.

         (h)      "Plan" shall mean the ABM Industries Incorporated Executive
                  Stock Option Plan, the terms of which are set forth herein.

         (i)      "Stock" shall mean the Common Stock of the Company or, in the
                  event that the outstanding shares of Stock are hereafter
                  changed into or exchanged for shares of a different stock or
                  securities of the Company or some other corporation, such
                  other stock or securities.



EXHIBIT 10.19                                                        Page 2 of 7

         (j)      "Stock Option Agreement" shall mean the agreement between the
                  Company and the Optionee under which the Optionee may purchase
                  Stock hereunder.

         (k)      "Subsidiary" shall mean any corporation, the majority of the
                  outstanding capital stock of which is owned, directly or
                  indirectly, by the Company.

         (l)      "Vesting Date" shall mean an Optionee's "Initial Vesting Date"
                  or "Final Vesting Date", as the case may be. An Optionee's
                  Initial Vesting Date shall apply to the first fifty percent
                  (50 %) of the shares covered by his or her Option, and shall
                  mean the Optionee's sixty-first (61st) birthday. An Optionee's
                  Final Vesting Date shall apply to the remaining fifty percent
                  (50%) of the shares covered by such Option, and shall mean the
                  Optionee's sixty fourth (64th) birthday.

                                   ARTICLE II

                                    The Plan

                  2.1 Name. This Plan shall be known as the "ABM Industries
         Incorporated Executive Stock Option Plan".

                  2.2 Purpose. The purpose of the Plan is to advance the
         interests of the Company and its shareholders by affording to
         Nonemployee Directors and to key management employees of the Company
         and its Subsidiaries an opportunity to acquire or increase their
         proprietary interest in the Company by the grant to such individuals of
         Options under the terms set forth herein. By thus encouraging such
         individuals to become owners of the Company shares, the Company seeks
         to motivate, retain, and attract those highly competent individuals
         upon whose judgment, initiative, leadership, and continued efforts the
         success of the Company in large measure depends.

                                   ARTICLE III

                                  Participants

                  Any officer or other key management employee of the Company of
         its Subsidiaries shall be eligible to participate in the Plan. Prior to
         December 9, 2003, the Committee may grant Options to any eligible
         employee in accordance with such determinations as the Committee from
         time to time in its sole discretion shall make. Effective December 9,
         2003, no additional Options shall be granted under the Plan. Each
         Nonemployee Director who both (1) is such on the date of the 1995
         Annual Meeting of Stockholders, and (2) does not hold an Option,
         automatically shall receive as of such date only, an Option to purchase
         12,000 shares of Stock, but subject to Section 6.2 (regarding the
         ineligibility of 10 percent ((10%) holders). Each Nonemployee Director
         who becomes such after the 1995 Annual Meeting of Stockholders and
         prior to December 9, 2003,



EXHIBIT 10.19                                                        Page 3 of 7

         automatically shall receive, as of the date of his or her election or
         appointment to the Board, an Option to purchase 12,000 shares of Stock.

                                   ARTICLE IV

                                 Administration

                  4.1 Duties and Powers of Committee. The Plan shall be
         administered by the Committee. Subject to the express provisions of the
         Plan, the Committee shall have the sole discretion and authority to
         determine from among eligible employee those to whom an the time or
         times at which the Options may be granted and the number of shares of
         Stock to be subject to each Option. Subject to the express provisions
         of the Plan, the Committee shall also have complete authority to
         interpret the Plan, to prescribe, amend, and rescind rules and
         regulations relating to it, to determine the details and provisions of
         each Stock Option Agreement, and to make all other determinations
         necessary or advisable in the administration of the Plan.

                  4.2 Majority Rule. A majority of the members of the committee
         shall constitute a quorum, and any action taken by a majority present
         at a meeting at which a quorum is present or any action taken without a
         meeting evidenced by a writing executed by a majority of the whole
         Committee shall constitute the action of the Committee.

                  4.3 Company Assistance. The Company shall supply fill and
         timely information to the Committee on all matters relating to eligible
         employees and Nonemployee Directors, their employment or service,
         death, retirment, disability or other termination of employment or
         service, and such other pertinent facts as the Committee may require.
         The Company shall furnish the Committee with such clerical and other
         assistance as is necessary in the performance of its duties.

                                    ARTICLE V

                         Shares of Stock Subject to Plan

                  5.1 Limitations. Subject to adjustment pursuant to the
         provisions of Section 5.3 hereof, the number of shares of Stock which
         may be issued and sold hereunder shall not exceed 2,360,000 shares.
         Such shares may be either authorized and unissued shares or shares
         issued and thereafter acquired by the Company.

                  5.2 Options and Awards Granted Under Plan. Shares of Stock
         with respect to which an Option granted hereunder shall have been
         exercised shall not again be available for Options hereunder. If
         Options granted hereunder shall terminate for any reason without being
         wholly exercised, new Options may be granted hereunder for the number
         of shares to which such Option termination relates.



EXHIBIT 10.19                                                        Page 4 of 7

         5.3 Antidilution. In the event that the outstanding shares of Stock
         hereafter are changed into or exchanged for a different number or kind
         of shares or other securities of the Company or of another corporation
         by reason of merger, consolidation, other reorganization,
         recapitalization, reclassification, combination of shares, stock
         split-up or stock dividend:

         (a)      The aggregate number and kind of shares subject to Options
                  which may be granted hereunder shall be adjusted
                  appropriately;

         (b)      Rights under outstanding Options granted hereunder, both as to
                  the number of subject shares and the Option price, shall be
                  adjusted appropriately;

         (c)      Where dissolution or liquidation of the Company or any merger
                  or combination in which the Company is not a surviving
                  corporation is involved, each outstanding Option granted
                  hereunder shall terminate, but the Optionee shall have the
                  right, immediately prior to such dissolution, liquidation,
                  merger, or combination, to exercise his Option in whole or in
                  part, without regard to any time of exercise provisions.

         The foregoing adjustments and the manner of application of the
foregoing provisions shall be determined solely the Committee, and any such
adjustment may provide for the elimination of fractional share interests

                                   ARTICLE VI

                                     Options

         6.1 Option Grant and Agreement. Each Option granted hereunder shall be
evidenced by minutes of a meeting or the written consent of the Committee and by
a written Stock Option Agreement dated as of the date of grant and executed by
the Company and the Optionee, which Agreement shall set forth such terms and
conditions as my be determined by the Committee consistent with the Plan.

         6.2 Participant Limitation. The Committee shall not grant an Option to
any individual for such number of shares of Stock that, immediately after the
grant, the total number of shares of Stock owned or subject to all options
exercisable at any time by such individual exceed ten percent (10 %) of the
total combined voting power of all Stock of the Company or its Subsidiaries. For
this purpose an individual shall be considered as owning stock owned, directly
or indirectly, by or for his brothers and sisters (whether by the whole or half
blood), spouse, ancestors, and lineal descendents, and stock owned, directly or
indirectly, by or for a corporation, partnership, estate, or trust shall be
considered as being owned proportionately by or for its shareholders, partners,
or beneficiaries.



EXHIBIT 10.19                                                        Page 5 of 7

         6.3 Option Price. The per share Option price of the Stock subject to
each Option shall be determined by the Committee, but the per share price shall
not be less than the Fair Market Value of the Stock on the date the Option is
granted. The per share Option price of the Stock subject to each Option granted
to a Nonemployee Director shall equal 100% of the Fair Market Value of the Stock
on the date the Option is granted.

         6.4 Period of Exercisablity. Subject to Sections 6.5 (a) and 6.7, the
period during which each Option may be exercised shall be determined in
accordance with the following rules. As to the first fifty percent (50%) of the
shares covered by an Option, the Option may be exercised during the period
commencing on the Optionee's Initial Vesting Date and ending one (1) year after
the Optionee's termination of employment with the Company and all of its
Subsidiaries (termination from the Board, in the case of Nonemployee Director).

As to the remaining fifty percent (50%) of the shares covered by the Option, the
Option may be exercised during the period commencing on the Optionee's Final
Vesting Date and ending one (1) year after the Optionee's termination of
employment with the Company and all of its Subsidiaries (termination from the
Board, in the case of a Nonemployee Director).

6.5 Option Exercise.

         (a)      Options granted hereunder may not be exercised unless the
                  Optionee shall have remained in the employ of the Company or
                  its Subsidiaries (on the Board in the case of a Nonemployee
                  Director) until the applicable Vesting Date.

         (b)      Options may be exercised in whole or in part from time to time
                  with respect to whole shares only, during such period for the
                  exercise thereof, and shall be exercised by written notice of
                  exercise with respect to a specified number of shares
                  delivered to the Company at its headquarters office, and
                  payment in full to the Company at said office of the amount of
                  the Option price for the number of shares of Stock with
                  respect to which the Option is exercised. In addition to and
                  at the time of payment of the Option price, Optionee shall pay
                  to the Company in cash the full amount of all the federal
                  and/or state withholding taxes applicable to the taxable
                  income of such Optionee resulting from such exercise.

         6.6 Nontransferablitiy of Option. No Option shall be transferable by an
Optionee and shall be exercisable only by him.

         6.7 Effect of Termination of Employment or Service. If, prior to an
Optionees applicable Vesting Date, the Optionee's employment or service shall be
terminated by the Company or a Subsidiary with or without cause, or by the act
of the Optionee, the right to exercise such Option (or portion thereof) shall
terminate and all rights thereunder shall cease.


EXHIBIT 10.19                                                        Page 6 of 7

         6.8 Rights as Stockholder. An Optionee shall have no rights as a
stockholder with respect to any shares subject to such Option prior to the
purchase of such shares by exercise of such Option as provided herein.

                                   ARTICLE VII

                               Stock Certificates

         The Company shall not be required to issue or deliver any certificate
for shares of Stock purchased upon the exercise of any Option granted hereunder
prior to fulfillment of all the following conditions:

         (a)      The admission of such shares to listing on all stock exchanges
                  on which the Stock is then listed;

         (b)      The completion of any registration or other qualification of
                  such shares under any federal or state law or under the
                  rulings or regulations of the Securities Exchange Commission
                  or any other governmental regulatory body, which the Committee
                  shall in its sole discretion deem necessary or advisable;

         (c)      The obtaining of any approval or other clearance from any
                  federal or state governmental agency which the Committee shall
                  in its sole discretion determine to be necessary or advisable;
                  and

         (d)      The lapse of such reasonable period of time following the
                  exercise of the Option as the Committee from time to time may
                  establish or approve for reasons of administrative
                  convenience.

                                  ARTICLE VIII

                        Amendment and Termination of Plan

         The Board may at any time, or from time to time, amend or terminate the
Plan in any respect, except that, to the extent required to maintain this Plan's
qualification under Rule 16b-3, any amendment shall be subject to stockholder
approval.

                                   ARTICLE IX

                                  Miscellaneous

         9.1 No Effect on Employment or Service. Nothing in the Plan or in any
Option granted hereunder or in any Stock Option Agreement shall confer upon any
employee the right to continue as a member of the Board or in the employ of the
Company or in any Subsidiary.



EXHIBIT 10.19                                                        Page 7 of 7

         9.2 Use of Proceeds. The proceeds received by the Company from the sale
of Stock pursuant to the exercise of Options shall be added to the Company's
general funds and used for general corporate purposes.

         9.3 Effective Date. The effective date of this amendment and
restatement of the Plan is December 9, 2003, the date of its approval by the
Board. The amendment and restatement of the Plan shall have no effect on the
Options granted under the Plan prior to the amendment and restatement.

         9.4 Plan Binding on Successors. The Plan shall be binding upon the
successors and assigns of the Company.

         9.5 Singular, Plural; Gender. Wherever used herein, nouns in the
singular shall include the plural and the masculine pronoun shall include the
feminine gender.

         9.6 Headings Not Part of Plan. Headings of Articles and Sections hereof
are inserted for convenience and reference; they constitute no part of the Plan.

EXHIBIT 10.20

                           ABM INDUSTRIES INCORPORATED
                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
                    PLAN DOCUMENT AS AMENDED DECEMBER 9, 2003

Preamble

This plan is an unfunded arrangement for a select group of management or
highly-compensated personnel of ABM Industries Incorporated (ABM) and its
subsidiaries. All rights under this Plan shall be governed by and construed in
accordance with the laws of the State of California.

ARTICLE I

Definitions

Section 1.01.

(a)      "ABM" means ABM Industries Incorporated, a Delaware corporation, its
         Subsidiaries and its corporate successors.

(b)      "Administrator" means the Controller of ABM or the person designated by
         the Committee with authority to manage and administer the operation of
         the Plan.

(c)      "Beneficiary" means the person, institution or trust designated by the
         Participant pursuant to 3.05 below to receive the Participant's
         interest in the Plan after the Participant's death.

(d)      "Committee" means the Compensation Committee of the Board of Directors
         of ABM Industries Incorporated.

(e)      "Fiscal Year" or "Year" (unless otherwise specified) means ABM's fiscal
         year as now constituted or as it may be changed hereafter from time to
         time.

(f)      "Participant" means an employee of ABM, or of a Subsidiary, designated
         by the Administrator for participation in the benefits of the Plan, or
         a person who was such at the time of his resignation, termination,
         retirement or death and who retains, or whose Beneficiaries obtain,
         benefits under the Plan in accordance with its terms.

(g)      "Payment Event" means a Participant's Retirement or in the event of
         earlier resignation, termination or death, the date the Participant
         attains or would have attained age 65.

(h)      "Plan" means this Supplemental Executive Retirement Plan as it may be
         amended from time to time.

(i)      "Retirement" means retirement at or after attaining age 65.

                                                                               1


EXHIBIT 10.20

(j)      "Supplemental Benefit" means the total amount allocated to the benefit
         of a Participant under the Plan.

(k)      "Subsidiary" means a company of which ABM owns, directly or indirectly,
         at least a majority of the shares  having  voting power in the election
         of directors.

ARTICLE II

Designation of Participants and Allocation of Total Fund

Section 2.01. The Administrator shall at least once in each Fiscal Year
irrevocably specify:

(a)      The name of each employee who shall be entitled to participate in the
         Plan for such Year; and

(b)      The amount to be allocated for the benefit of each Participant for such
         Year.

Effective December 31, 2002, there shall be no new Participants in the Plan and
designations by the Administrator shall be limited to allocations to active
employees of ABM who are participants in the Plan.

Section 2.02. The amount to be allocated for the benefit of each Participant
shall be determined in accordance with the terms of the most recent Grant
Certificate in existence for each Participant, which Grant Certificates have
been approved by the Committee. The Administrator shall report to the Committee
the amounts allocated and Participants for such Year.

ARTICLE III

Future Payments

Section 3.01. The Administrator shall cause an accrual account to be kept in the
name of each Participant and each Beneficiary of a deceased Participant. The
accrual account shall reflect the value of the Supplemental Benefits payable to
such Participant or Beneficiary under the Plan.

Section 3.02. Until and except to the extent that Supplemental Benefits
hereunder are distributed to the Participants or Beneficiaries from time to time
in accordance with orders of the Administrator, the interest of each Participant
and Beneficiary herein is that of a general creditor of ABM and is contingent on
and subject to forfeiture as provided in Section 3.06. Title to and beneficial
ownership of any assets, whether cash or investments, which ABM may set aside or
accrue to meet its obligations hereunder, shall at all times remain the property
of ABM. No Participant or Beneficiary shall under any circumstances acquire any
property interest in any specific assets of ABM.

                                                                               2


EXHIBIT 10.20

Section 3.03. Upon resignation, termination, Retirement or death of a
Participant, the value of the Supplemental Benefits payable to such Participant
or Beneficiary shall be determined with reference to the accrual account
maintained for such Participant.

Section 3.04. Payment of the amount allocated to a Participant shall be deferred
until the occurrence of a Payment Event. If the Participant dies before
receiving any or all of the payments due the Participant, any remaining amount
shall be paid, but not before the Participant would have reached age 65, to the
Beneficiary. After determining the value of the Supplemental Benefit for a
Participant entitled to payment, the Administrator shall arrange to pay 1/120th
of the value of the account to the Participant or Beneficiary each month for a
period of 10 years from the date of the Payment Event. There shall be no gains
or losses allocated to the account during the 10 year period of payment.

Section 3.05. Each Participant shall have the right to designate a Beneficiary
or Beneficiaries who are to succeed to his right to receive future payments
hereunder in the event of his death. In case of a failure of designation or the
death of a designated Beneficiary without a designated successor, distribution
shall be made to the Participant's estate or trust, if a trust for such purpose
is in existence. No designation of Beneficiary shall be valid unless in writing
signed by the Participant, dated, and filed with the Committee. Beneficiaries
may be changed without consent of any prior Beneficiaries.

Section 3.06. The right of a Participant or Beneficiary to receive future
payments hereunder shall be vested at all times; provided, however, that such
right shall be forfeited immediately upon the occurrence of either of the
following events: If the Participant is discharged from employment by ABM or a
subsidiary for acts which, in the opinion of the ABM, constitute embezzlement of
corporate funds or if, following the Participant's termination of employment, it
is determined that he or she has embezzled corporate funds.

Section 3.07. Nothing contained herein shall be deemed to create a trust of any
kind for the benefit of any Participant or Beneficiary, or create any fiduciary
relationship. Funds accrued hereunder shall continue for all purposes to be a
part of the general funds of ABM, and no person other than ABM shall, by virtue
of the provisions of this Plan, have any interest in such funds. To the extent
that any person acquires a right to receive payments from ABM under this Plan,
such right shall be no greater than the right of any unsecured general creditor
of ABM.

Section 3.08. The adoption of this Plan shall not confer upon any employee of
ABM or any of its subsidiaries or Participant any right to continued employment,
nor shall it interfere in any way with the right of ABM or any of its
Subsidiaries to terminate the employment or change the compensation of any of
its employees at any time.

                                                                               3


EXHIBIT 10.20

ARTICLE IV

Administration

Section 4.01. The books and records to be maintained for the purpose of the Plan
shall be maintained by the officers and employees of ABM at its expense and
subject to the supervision and control of the Administrator. ABM shall pay all
expenses of administering the Plan.

Section 4.02. To the extent permitted by law, the right of any Participant or
any Beneficiary in any benefit or to any payment hereunder shall not be subject
in any manner to attachment or other legal process for the debts of such
Participant or Beneficiary; and any such benefit or payment shall not be subject
to anticipation, alienation, sale, transfer, assignment or encumbrance. In the
event that the Plan is presented with an appropriate order from a family court
or other court of competent jurisdiction dividing the right to benefits under
this Plan or to receiving continuing payments under this Plan between the
Participant and the Participant's spouse, the Administrator shall establish such
accounts and sub-accounts and make arrangement for such payments as the order
may require. In no event shall the Plan be required to pay a benefit in a
greater amount or earlier than would otherwise be required by the Plan for
payments to the Participant.

Section 4.03. No member of the Committee or the Administrator and no officer or
employee of ABM shall be liable to any person for any action taken or omitted in
connection with the administration of this Plan unless attributable to his own
fraud or willful misconduct; nor shall ABM be liable to any person for any such
action unless attributable to fraud or willful misconduct on the part of a
director, officer or employee of ABM.

Section 4.04. The Committee shall establish procedures for handling claims for
benefits under the Plan and appeals from denied claims.

ARTICLE V

Amendment of Plan

Section 5.01. The Committee may amend the Plan in whole or in part from time to
time.

Section 5.02. Notice of every such amendment shall be given in writing to each
Participant and Beneficiary of each deceased Participant.

ARTICLE VI

Entire Agreement

This Supplemental Executive Retirement Plan Document and the most recently dated
Grant Certificate delivered to a Participant and properly signed by an officer
of ABM, shall supersede all prior plans, documents, agreements, offers,
contracts or clauses,

                                                                               4


EXHIBIT 10.20

whether designated as "Executive Retirement", "Post Employment Consultancy" or
by any other term, which refer to the benefit of such Participant which is the
subject matter of this Plan Document.

Encls: SERP Grant Certificate
       SERP Designation of Beneficiary Form

                                                                               5


EXHIBIT 10.20

ABM Industries Incorporated
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
DESIGNATION OF BENEFICIARY

It is important that each Participant in the Company's Supplemental Executive
Retirement Plan (SERP) designate a beneficiary for the payment of Plan benefits
in the event of the Participant's death prior to a full distribution of
benefits.

Please return a copy of this completed Designation of Beneficiary form to ABM
Industries, Attn: Executive Compensation Administrator, 160 Pacific Avenue, San
Francisco, California 94111.

This form should be promptly updated by the Participant whenever there is a
change of address or designated beneficiary.

SECTION I:  PERSONAL INFORMATION

Name____________________________Spouse's Name__________________________________

SSN:____________________________Company/Location_______________________________

Home Address____________________City/State/Zip_________________________________

SECTION II: DESIGNATION OF BENEFICIARY

Pursuant to the terms and conditions of the Plan, I hereby designate the
following as my beneficiary(ies), to whom any benefits I may then have in the
Plan may be paid upon my death. This designation supersedes any prior
beneficiary designation made by me with respect to these benefits.

Primary: I name the following person(s) or entity(ies) as my Primary
Beneficiary(ies):

Name:_____________________________________SSN__________________________________

Address_________________________________________________________________________

Name:_____________________________________SSN___________________________________

Address_________________________________________________________________________

Secondary: If my Primary beneficiary(ies) is (are) unable to receive this
distribution, I Name the following Secondary person(s) or entity(ies) as my
Secondary Beneficiary(ies):

Name_____________________________________SSN___________________________________

Address________________________________________________________________________

Name______________________________________SSN__________________________________

Address________________________________________________________________________


I HEREBY CERTIFY THAT THE ABOVE INFORMATION IS TRUE AND CORRECT. THE COMPANY,
PLAN ADMINISTRATOR AND ANY OTHER PERSONS ASSOCIATED WITH THE ADMINISTRATION OF
THE PLAN ARE ENTITLED TO RELY ON THIS DOCUMENT AND SHALL BE FREE OF LIABILITY
FOR ANY ACTION TAKEN UNDER THE PROVISIONS OF THE PLAN AND IN RELIANCE ON THIS
DOCUMENT.

________________________________________      __________________________________
Participant's Signature/Date                  Spouse's Signature/Date

Witness to Signatures:__________________________________________________________

                                                                               6

EXHIBIT 10.21                                                       Page 1 of 11

         [CORPORATE EXECUTIVE] [CORPORATE OFFICER] EMPLOYMENT AGREEMENT

THIS [CORPORATE EXECUTIVE] [CORPORATE OFFICER] EMPLOYMENT AGREEMENT
("Agreement") is made effective as of [MONTH, DAY, YEAR], by and between
[EXECUTIVE/OFFICER NAME] ("Executive"), and ABM INDUSTRIES INCORPORATED
("Company") for itself and on behalf of its subsidiary corporations as
applicable herein.

WHEREAS, Company is engaged in the building maintenance and related service
businesses, and

WHEREAS, Executive is experienced in the administration, finance, marketing,
and/or operation of such services, and

WHEREAS, Company has invested significant time and money to develop proprietary
trade secrets and other confidential business information, as well as invaluable
goodwill among its customers, sales prospects and employees, and

WHEREAS, Executive wishes to, or has been and desires to remain employed by
Company, and to utilize such proprietary trade secrets, other confidential
business information and goodwill, and

WHEREAS, Company has disclosed or will disclose to Executive such proprietary
trade secrets and other confidential business information which Executive will
utilize in the performance of this Agreement;

NOW THEREFORE, Executive and Company agree as follows:

A.       EMPLOYMENT: Company hereby agrees to employ Executive, and Executive
         hereby accepts such employment, on the terms and conditions set forth
         in this Agreement.

B.       TITLE: Executive's title shall be [executive's title], subject to
         modification as mutually agreed upon by both Company and Executive.

C.       DUTIES & RESPONSIBILITIES: Executive shall be expected to assume and
         perform such executive or managerial duties and responsibilities as are
         assigned from time-to-time by the [reporting authority] or his or her
         designee, to whom Executive shall report and be accountable.

D.       TERM OF AGREEMENT: Employment hereunder shall be deemed effective as of
         [month, day, year], for a term of [one year] [two years] ("Initial
         Term"), unless sooner terminated pursuant to Paragraph O hereof, or
         later extended pursuant to Paragraph N hereof ("Extended Term").

E.       PRINCIPAL OFFICE: During the Initial Term and any Extended Term, as
         applicable, of this Agreement, Executive shall be based at a Company
         office located in [city] in the state of [state] ("State of
         Employment"), or such other location as shall be mutually agreed upon
         by Company and Executive.

F.       COMPENSATION: Company agrees to compensate Executive, and Executive
         agrees to accept as compensation in full, for Executive's assumption
         and performance of duties and responsibilities pursuant to this
         Agreement:

         1.       SALARY: A salary paid in equal installments of no less
                  frequently than semi-monthly at the annual rate set forth in
                  Paragraph X.1 hereof.

         2.       BONUS: A bonus or other incentive or contingent compensation,
                  if any, pursuant to Paragraph X.2 hereof.

         3.       FRINGE BENEFITS: Executive shall receive the then current
                  fringe benefits generally provided by Company to all of its
                  Executives. Such benefits may include but not be limited to
                  the use of a Company-leased car or a car allowance, group
                  health benefits, long-term disability benefits, group

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                       Page 2 of 11

                  life insurance, sick leave and vacation. Each of these fringe
                  benefits is subject to the applicable Company policy at all
                  times. Executive expressly agrees that should he or she
                  terminate employment with Company for the purpose of being
                  re-employed by a Company affiliate, he or she shall
                  "carry-over" any previously accrued but unused vacation
                  balance to the books of the affiliate.

                  Company reserves the right to add, increase, reduce or
                  eliminate any fringe benefit at any time, but no such benefit
                  or benefits shall be reduced or eliminated as to Executive
                  unless generally reduced or eliminated as to comparable
                  executives within the Company.

G.       PAYMENT OR REIMBURSEMENT OF BUSINESS EXPENSES: Company shall pay
         directly or reimburse Executive for reasonable business expenses of
         Company incurred by Executive in connection with Company business, and
         approved in writing by the person(s) to whom Executive reports pursuant
         to Paragraph C hereof, upon presentation to such person(s) by Executive
         within sixty (60) days after incurring such expense of an itemized
         request for payment including the date, nature, recipient, purpose and
         amount of each such expense, accompanied by receipts for all such
         expenses in accordance with Company policy.

H.       BUSINESS CONDUCT: Executive shall comply with all applicable laws
         pertaining to the performance of this Agreement, and with all lawful
         and ethical rules, regulations, policies, codes of conduct, procedures
         and instructions of Company, including but not limited to the
         following:

         1.       GOOD FAITH: Executive shall not act in any way contrary to the
                  best interest of Company. Executive agrees that if he or she
                  is approached by any person to discuss a possible acquisition
                  or other transaction that could result in a change of control
                  of the Company, Executive will immediately advise the
                  Company's General Counsel and Chair of the Nominating,
                  Governance and Succession Committee of the Board of Directors.

         2.       BEST EFFORTS: During all full-time employment hereunder,
                  Executive shall devote full working time and attention to
                  Company. Notwithstanding any other agreement to the contrary,
                  Executive shall not at any time be directly or indirectly
                  employed by, own, operate, assist or otherwise be involved,
                  invested or associated in any business that is similar or
                  competitive to any business of Company; except that Executive
                  may own up to five percent (5%) of such publicly-held
                  business(es), provided that Executive: (a) shall give Company
                  notice(s) of any such ownership exceeding two percent (2%), in
                  accordance with Paragraph W hereof, and (b) shall not at any
                  time be directly or indirectly employed by or operate, assist,
                  or otherwise be involved or associated with any such
                  business(es).

         3.       VERACITY: Executive shall make no claims or promises to any
                  employee, supplier, contractor, customer or sales prospect of
                  Company that are unauthorized by Company or are in any way
                  untrue.

         4.       DRIVER'S LICENSE: Executive shall have a driver's permit
                  issued by Company and shall carry a valid driver's license
                  issued by his or her state of domicile or the State of
                  Employment hereunder whenever Executive is driving any motor
                  vehicle in connection with Company business. Executive agrees
                  to immediately notify Company in writing if Executive's
                  driver's license is lost, expired, restricted, suspended or
                  revoked for any reason whatsoever.

         5.       CODE OF CONDUCT: Executive agrees to fully comply with and
                  annually execute a certification of compliance with the
                  Company's Code of Business Conduct and Ethics.

I.       NO CONFLICT: Executive represents to Company that Executive is not
         bound by any contract with a previous employer or with any other
         business that might prevent Executive from entering into this
         Agreement. Executive further represents that he or she is not bound by
         any other contracts or covenants that in any way restrict or limit
         Executive's activities in relation to his or her employment with
         Company that have not been fully disclosed to Company prior to the
         signing of this Agreement.

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                       Page 3 of 11

J.       COMPANY PROPERTY: Company shall, from time to time, entrust to the
         care, custody and control of Executive certain of Company's property,
         such as motor vehicles, equipment, supplies, passwords and documents.
         Such documents may include, but shall not be limited to customer lists,
         financial statements, cost data, price lists, invoices, forms,
         electronic files and media, mailing lists, contracts, reports, manuals,
         personnel files or directories, correspondence, business cards, copies
         or notes made from Company documents and documents compiled or prepared
         by Executive for Executive's use in connection with Company business.
         Executive specifically acknowledges that all such items, including
         passwords and documents, are the property of Company, notwithstanding
         their preparation, care, custody, control or possession by Executive at
         any time(s) whatsoever.

K.       GOODWILL & PROPRIETARY INFORMATION: In connection with Executive's
         employment hereunder:

         1.       Executive agrees to utilize and further Company's goodwill
                  ("Goodwill") among its customers, sales prospects and
                  employees, and acknowledges that Company may disclose to
                  Executive and Executive may disclose to Company, proprietary
                  trade secrets and other confidential information not in the
                  public domain ("Proprietary Information") including but not
                  limited to specific customer data such as: (a) the identity of
                  Company's customers and sales prospects, (b) the nature,
                  extent, frequency, methodology, cost, price and profit
                  associated with its services and products purchased from
                  Company, (c) any particular needs or preferences regarding its
                  service or supply requirements, (d) the names, office hours,
                  telephone numbers and street addresses of its purchasing
                  agents or other buyers, (e) its billing procedures, (f) its
                  credit limits and payment practices, and (g) its organization
                  structure.

         2.       Executive agrees that such Proprietary Information and
                  Goodwill have unique value to Company, are not generally known
                  or readily available to Company's competitors, and could only
                  be developed by others after investing significant time and
                  money. Company would not make such Proprietary Information and
                  Goodwill available to Executive unless Company is assured that
                  all such Proprietary Information and Goodwill will be held in
                  trust and confidence by Executive. Executive hereby
                  acknowledges that to use this Proprietary Information and
                  Goodwill except for the benefit of Company would be a breach
                  of such trust and confidence and in violation of Executive's
                  common law Duty of Loyalty to the Company.

L.       RESTRICTIVE COVENANTS: In recognition of Paragraph K, above, Executive
         hereby agrees that during the Initial Term and the Extended Term, if
         any, of this Agreement, and thereafter as specifically agreed herein:

         1.       Except in the proper performance of this Agreement, Executive
                  shall at no time directly or indirectly solicit or otherwise
                  encourage or arrange for any employee to terminate employment
                  with Company while employed by the Company and for a period of
                  one (1) year following Executive's termination of employment.

         2.       Except in the proper performance of this Agreement, Executive
                  shall not directly or indirectly disclose or deliver to any
                  other person or business, any Proprietary Information obtained
                  directly or indirectly by Executive from, or for, Company.

         3.       Executive agrees that at all times after the termination of
                  this Agreement, Executive shall not seek, solicit, divert,
                  take away, obtain or accept the patronage of any customer or
                  sales prospect of Company through the direct or indirect use
                  of any Proprietary Information of Company, or by any other
                  unfair or unlawful business practice.

         4.       Executive agrees that for a reasonable time after the
                  termination of this Agreement, which Executive and Company
                  hereby agree to be one (1) year, Executive shall not directly
                  or indirectly, for Executive or for any other person or
                  business, seek, solicit, divert, take away, obtain or accept

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                       Page 4 of 11

                  any customer account or sales prospect with which Executive
                  had direct business involvement on behalf of Company within
                  the one (1) year period prior to termination of this
                  Agreement.

         5.       Nothing in this Agreement shall be binding upon the parties to
                  the extent it is void or unenforceable for any reason in the
                  State of Employment, including, without limitation, as a
                  result of any law regulating competition or proscribing
                  unlawful business practices.

M.       MODIFICATION OF EMPLOYMENT: At any time during the then current Initial
         or Extended Term, as applicable, of this Agreement, a majority of the
         Board of Directors of Company shall have the absolute right, with or
         without cause and without terminating this Agreement or Executive's
         employment hereunder, to modify the nature of Executive's employment
         for the remainder of the then current Initial or Extended Term, as
         applicable, of this Agreement, from that of a full-time employee to
         that of a part-time employee ("Modification Period"). The Modification
         Period shall commence immediately upon Company giving Executive written
         notice of such change.

         1.       Upon commencement of the Modification Period: (a) Executive
                  shall immediately resign as a full-time employee of Company
                  and as an officer and/or director of Company and of any
                  Company subsidiaries, as applicable, (b) Executive shall
                  promptly return all Company property in Executive's possession
                  to Company, including but not limited to any motor vehicles,
                  equipment, supplies and documents set forth in Paragraph J
                  hereof, and (c) Company shall pay Executive when due all
                  previously earned and vested but as yet unpaid, salary,
                  prorated Target Bonus as determined pursuant to Paragraph X.2.
                  or other contingent compensation, reimbursement of business
                  expenses and fringe benefits.

         2.       During the Modification Period: (a) Company shall continue to
                  pay Executive's monthly salary pursuant to Paragraph F.1
                  hereof, and to the extent available under the Company's group
                  insurance policies, continue to provide Executive with the
                  same group health and life insurance (subject to Executive
                  continuing to pay the employee portion of any such premium) to
                  which Executive would be entitled as a full-time employee,
                  with the understanding and agreement that such monthly salary
                  and group insurance, if available, shall constitute the full
                  extent of Company's obligation to compensate Executive, (b)
                  Executive shall not be eligible or entitled to receive or
                  participate in any bonus or fringe benefits other than the
                  aforementioned group insurance, if available, (c) in the
                  alternative, Executive may exercise rights under COBRA to
                  obtain medical insurance coverage as may be available to
                  Executive, (d) Executive shall be deemed a part-time employee
                  and not a full-time employee of Company, (e) Executive shall
                  provide Company with such occasional executive or managerial
                  services as reasonably requested by the person(s) to whom
                  Executive reports pursuant to Paragraph C hereof, except that
                  failure to render such services by reason of any physical or
                  mental illness or disability other than Total Disability or
                  death as set forth in Paragraph O.2 hereof, or unavailability
                  because of absence from the State of Employment hereunder,
                  shall not affect Executive's right to receive such salary and
                  (f) Company shall pay directly or reimburse Executive in
                  accordance with the provisions of Paragraph G hereof for
                  reasonable business expenses of Company incurred by Executive
                  in connection with such services requested by the person(s) to
                  whom Executive reports pursuant to Paragraph C hereof.

         3.       The Modification Period shall continue until the earlier of:
                  (a) Total Disability or death as set forth in Paragraph O.2
                  hereof, (b) termination of this Agreement by Company for "just
                  cause" as hereinafter defined, (c) Executive accepting
                  employment or receiving any other compensation from operating,
                  assisting or otherwise being involved, invested or associated
                  with any business that is similar to or competitive with any
                  business in which Company is engaged on the commencement date
                  of the Modification Period, or (d) expiration of the then
                  current Term of this Agreement.

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                       Page 5 of 11

N.       EXTENSION OF EMPLOYMENT:

         1.       Absent at least ninety (90) days written Notice of Termination
                  of Employment or Notice of Non-Renewal from Company to
                  Executive prior to expiration of the then current Initial or
                  Extended Term, as applicable, of this Agreement, employment
                  hereunder shall continue for an Extended Term (or another
                  Extended Term, as applicable) of one year, by which Executive
                  and Company intend that all terms and conditions of this
                  Agreement shall remain in full force and effect for another
                  twelve (12) months, except that the base salary specified in
                  Paragraph X.1.a may be increased as set forth in Paragraph
                  X.1.b during the Extended Term.

         2.       In the event that Notice of Non-Renewal is given ninety (90)
                  days prior to the expiration of the then Initial or Extended
                  Term, as applicable, of this Agreement, employment shall
                  continue on an "at will" basis following the expiration of
                  such Initial or Extended Term. In such event, Company shall
                  have the right to change the terms and conditions of
                  Executive's employment, including but not limited to
                  Executive's position and/or compensation.

O.       TERMINATION OF EMPLOYMENT:

         1.       a.       Termination Upon Expiration Of Term. Subject to at
                           least ninety (90) days prior written Notice of
                           Termination of Employment, Executive's employment
                           shall terminate, with or without cause, at the
                           expiration of the then current Initial or Extended
                           Term. Company has the option, without terminating
                           this Agreement,of placing Executive on a leave of
                           absence at the full compensation set forth in
                           Paragraph F hereof, for any or all of such notice
                           period.

                  b.       Termination For Cause. Except as provided in
                           Paragraph O.1.a, the Company shall have the right to
                           terminate Executive's employment hereunder at any
                           time during the then current Initial or Extended
                           Term, as applicable, of this Agreement, without
                           notice subject only to a good faith determination by
                           a majority of the Board of Directors of Company of
                           "just cause." "Just cause" includes but is not
                           limited to any (i) theft or dishonesty (ii) more than
                           one instance of neglect or failure to perform
                           employment duties, (iii) more than one instance of
                           inability or unwillingness to perform employment
                           duties, (iv) insubordination, (v) abuse of alcohol or
                           other drugs or substances affecting Executive's
                           performance of his or her employment duties, (vi)
                           material and willful breach of this Agreement; (vii)
                           other misconduct, unethical or unlawful activity, or
                           for (vii) a conviction of or plea of "guilty" or "no
                           contest" to a felony under the laws of the United
                           States or any state thereof.

                  c.       Voluntary Termination By Executive. At any time
                           during the then current Initial or Extended Term, as
                           applicable, of this Agreement and with or without
                           cause, Executive may terminate employment hereunder
                           by giving Company ninety (90) days prior written
                           notice.

         2.       Employment hereunder shall automatically terminate upon the
                  total disability ("Total Disability") or death of Executive.
                  Total Disability shall be deemed to occur on the ninetieth
                  (90th) consecutive or non-consecutive calendar day within any
                  twelve (12) month period that Executive is unable to perform
                  the duties set forth in Paragraph C hereof because of any
                  physical or mental illness or disability. Company shall pay
                  when due to Executive or, upon death, Executive's designated
                  beneficiary or estate, as applicable, all prorated salary,
                  prorated Target Bonus as determined pursuant to Paragraph X.2.
                  or other contingent compensation, reimbursement of business
                  expenses and fringe benefits which would have otherwise been
                  payable to Executive under this Agreement, through the end of
                  the month in which Total Disability or death occurs.

         3.       Upon termination of employment hereunder, Executive shall
                  immediately resign as an employee of Company and as an officer
                  and/or director of Company and of any Company subsidiaries, as
                  applicable. Executive shall promptly return and release all
                  Company property in Executive's

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                       Page 6 of 11

                  possession to Company, including but not limited to, any motor
                  vehicles, equipment, supplies, passwords and documents set
                  forth in Paragraph J hereof. Company shall pay Executive, when
                  due, all previously earned and vested but as yet unpaid,
                  salary, prorated Target Bonus as determined pursuant to
                  Paragraph X.2. or other contingent compensation, reimbursement
                  of business expenses and fringe benefits.

P.       GOVERNING LAW: This Agreement shall be interpreted and enforced in
         accordance with the laws of the State of Employment hereunder.

Q.       ARBITRATION CLAUSE:

         1.       Except for the interpretation and enforcement of injunctive
                  relief pursuant to Paragraph R hereof (which shall be subject
                  to litigation in any court having proper jurisdiction), any
                  claim or dispute related to or arising from this Agreement
                  (whether based in contract or tort, in law or equity)
                  including, but not limited to, claims or disputes between
                  Executive and Company or its directors, officers, employees
                  and agents regarding Executive's employment or termination of
                  employment hereunder, or any other business of Company, shall
                  be resolved by a neutral arbitrator agreed upon by both
                  parties, through mandatory, final, binding arbitration in
                  accordance with the procedural and discovery rules of the
                  American Arbitration Association.

         2.       The cost of such arbitration shall be borne by the Company.
                  Any such arbitration must be requested in writing within one
                  (1) year from the date the party initiating the arbitration
                  knew or should have known about the claim or dispute, or all
                  claims arising from that dispute are forever waived. Any such
                  arbitration (or court proceeding as applicable hereunder)
                  shall be held in the city and/or county of employment
                  hereunder. Judgment upon the award rendered through such
                  arbitration may be entered and enforced in any court having
                  proper jurisdiction.

R.       REMEDIES & DAMAGES:

         1.       The parties agree that, in the event of a material breach or
                  threatened material breach of Paragraphs K and/or L hereof,
                  the damage or imminent damage to the value of Company's
                  business shall be impractical and/or impossible to estimate or
                  ascertain, and therefore any remedy at law or in damages shall
                  be inadequate. Accordingly, the parties hereto agree that
                  Company shall be entitled to the immediate issuance of a
                  restraining order or an injunction against Executive in the
                  event of such breach or threatened breach, in addition to any
                  other relief available to Company pursuant to this Agreement
                  or under law.

         2.       Executive agrees that damages resulting from any such breach
                  which involves any customer of Company shall be the actual
                  damages according to proof, as determined by an arbitrator
                  pursuant to Paragraph Q, above.

         3.       To the full extent permitted under the laws of the State of
                  Employment hereunder, Executive authorizes Company to withhold
                  from any severance payments otherwise due to Executive and
                  from any other funds (other than wages) held for Executive's
                  benefit by Company, any damages or losses sustained by Company
                  as a result of any material breach or other material violation
                  of this Agreement by Executive, pending arbitration between
                  the parties as provided for herein.

S.       NO WAIVER: Failure by either party to enforce any term or condition of
         this Agreement at any time shall not preclude that party from enforcing
         that provision, or any other provision of this Agreement, at any later
         time.

T.       SEVERABILITY: The provisions of this Agreement are severable. If any
         arbitrator (or court as applicable hereunder) rules that any portion of
         this Agreement is invalid or unenforceable, the arbitrator's or court's
         ruling shall not affect the validity and enforceability of other
         provisions of this Agreement. It is the intent of the parties that if
         any provision of this Agreement is ruled to be overly broad, the
         arbitrator or court shall

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                       Page 7 of 11

         interpret such provision with as much permissible breadth as is
         allowable under law rather than to consider such provision void.

U.       SURVIVAL: All terms and conditions of this Agreement which by
         reasonable implication are meant to survive the termination of this
         Agreement, including but not limited to the Restrictive Covenants and
         Arbitration Clause herein, shall remain in full force and effect after
         the termination of this Agreement.

V.       REPRESENTATIONS: Executive represents and agrees that he or she has
         carefully read and fully understands all of the provisions of this
         Agreement, that he or she is voluntarily entering into this Agreement
         and has been given an opportunity to review all aspects of this
         Agreement with an attorney, if he or she chooses to do so.

W.       NOTICES:

         1.       Any notice required or permitted to be given pursuant to this
                  Agreement shall be in writing and delivered in person, or sent
                  prepaid by certified mail, bonded messenger or overnight
                  express, to the party named at the address set forth below or
                  at such other address as either party may hereafter designate
                  in writing to the other party:

                  EXECUTIVE:        [NAME]
                                    [Home address]
                                    [Home city, state, zip]

                  COMPANY:          ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA  94111
                                    Attention:  Chief Executive Officer

                  COPY:             ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA  94111
                                    Attention: Chief Employment Counsel

         2.       Any such Notice shall be assumed to have been received when
                  delivered in person, or forty-eight (48) hours after being
                  sent in the manner specified above.

X.       SPECIAL PROVISIONS:

         1.       BASE SALARY:

                  a.       [Executive's annual salary for Fiscal Year 200[ ]
                           shall be no less than his or her salary in effect on
                           October 31, 200[ ], subject to the provisions
                           contained in Subparagraph b, below.]

                           [(Annual salary amount spelled out) ($xxx,xxx) per
                           year effective [month, day, year] through [month,
                           day, year] at the monthly rate of $xxx,xxx.xx payable
                           semi-monthly.]

                  b.       Effective [month, day, year] and at the beginning of
                           each Fiscal Year thereafter, Executive shall be
                           eligible, at the sole discretion of the Company, to
                           receive a merit increase based on Executive's job
                           performance.

                  c.       At the sole discretion of the Board of Directors of
                           the Company (the "Board"), the Company may grant a
                           salary adjustment at any time for reasons deemed
                           appropriate by

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                       Page 8 of 11

                           the Board, including but not limited to a change in
                           Executive's duties resulting in a material increase
                           in responsibility.

         2.       BONUS: Subject to proration in the event of modification or
                  termination of employment hereunder and further subject to the
                  maximum bonus payable under Subparagraph d, below, Executive
                  shall be paid a bonus ("Bonus") based on the profit ("Profit")
                  for each Fiscal Year, or partial Fiscal Year, of employment
                  hereunder during the Initial Term, and during the Extended
                  Term, if any, of this Agreement, as follows:

         a.       A Target Bonus for each Fiscal Year shall be initially
                  calculated by multiplying Executive's bonus percentage of
                  [_______________]% times the Company's Profit. Executive's
                  Target Bonus shall be further subject to an Executive
                  Performance Bonus Modifier adjustment of [50% to 150%] [80% to
                  120%] to determine Executive's Actual Bonus. Such adjustment
                  shall be based on criteria contained in Executive's annual
                  Performance Rating (see copy attached as Exhibit I) as
                  recommended by the person(s) to whom Executive reports and
                  reviewed and approved by the Executive Officer Compensation
                  and Stock Option Committee of the Board and the Board.

         B.       [Profit for purposes of determining such Target Bonus, shall
                  be defined as the consolidated income (in accordance with
                  generally accepted accounting principles) before income taxes
                  of the Company, excluding: (i) gains or losses on sales or
                  exchanges of real property or on sales or exchanges of all or
                  substantially all of the stock or assets of a subsidiary
                  corporation or any other business unit of Company [and] [,]
                  (ii) gains or losses on the sales of any discontinued business
                  operations of the Company[.] [and (iii)] [any WTC related
                  gain] [the total amount of all items of income included in the
                  Company's audited consolidated financial statements for any
                  Fiscal Year that result from the Company's receipt of
                  insurance proceeds or other compensation or damages due to the
                  Company's loss of property, business or profits as a result of
                  the destruction of the World Trade Center on September 11,
                  2001.] At any time the Board of Directors of the Company
                  reserves the right to further adjust Profit for purposes of
                  determining a Target Bonus in the event of a Significant
                  Transaction (as defined below) during a Fiscal Year and/or for
                  any unanticipated and material events that are beyond the
                  control of the Company, including but not limited to acts of
                  god, nature, war or terrorism, or changes in the rules for
                  financial reporting set forth by the Financial Accounting
                  Standards Board, the Securities and Exchange Commission,
                  and/or the New York Stock Exchange or for any other reason
                  which the Board determines, in good faith, to be appropriate.

                  [Notwithstanding the foregoing,] [Profit for purposes of
                  determining the Target Bonus in any Fiscal Year during the
                  Initial or Extended Term of this Agreement, shall include WTC
                  Related Gain and WTC Related Carry-Over Gain in an aggregate
                  amount not to exceed a maximum of $10 million per Fiscal Year.
                  For purposes of this Agreement, the term "WTC Related Gain"
                  shall mean the total amount of all items of income included in
                  the Company's audited consolidated financial statements for
                  any Fiscal Year that result from the Company's receipt of
                  insurance proceeds or other compensation or damages due to the
                  Company's loss of property, business or profits as a result of
                  the destruction of the World Trade Center on September 11,
                  2001. Also, for purposes of this Agreement, the term "WTC
                  Related Carry-Over Gain" shall mean the aggregate amount of
                  WTC Related Gain not previously taken into account in
                  determining a Target Bonus for a prior Fiscal Year. Finally,]
                  [F] [f]or purposes of this Agreement, the term "Significant
                  Transaction" shall mean the Company's acquisition or
                  disposition of a business or assets which the Company is
                  required to report under Item 2 of the SEC Form 8-K.

         c.       The Chief Financial Officer of the Company shall calculate the
                  Profit and Target Bonus for purposes of this Agreement.
                  Company shall pay Executive the Actual Bonus for the Fiscal
                  Year, or prorated Target Bonus in the event of modification or
                  termination of employment

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                       Page 9 of 11

                   hereunder, following completion of the audit of the Company's
                   financial statements and approval by the Company's Executive
                   Officer Compensation and Stock Option Committee and the
                   Company's Board of Directors, but no later than seventy-five
                   (75) days after the end of each Fiscal Year. The Company in
                   its sole discretion may pay any Actual Bonus or prorated
                   Target Bonus earlier. The Actual Bonus for any partial Fiscal
                   Year shall be prorated for the fraction of the Fiscal Year
                   for which such Actual Bonus is payable. Absent bad faith or
                   material error, any calculations of the Chief Financial
                   Officer and any conclusions of the Board, with respect to the
                   amounts of the Profit, Target Bonus or Actual Bonus, shall be
                   final and binding upon Executive and Company.

         d.        Executive's maximum Actual Bonus for each Fiscal Year shall
                   be [50%] [100%] of the Base Salary for that year as
                   determined pursuant to this Agreement. In the event of
                   modification or termination of employment hereunder,
                   Executive's prorated Target Bonus shall not exceed such
                   percent of prorated Base Salary.

         [e.]      [Notwithstanding the foregoing, no Bonus for any Fiscal Year
                   of the Company shall be payable unless the Company's EPS for
                   the Fiscal Year then ending is equal to or greater than
                   eighty percent (80%) of the Company's EPS for the previous
                   Fiscal Year of the Company, in each case excluding any gains
                   and losses from sales of discontinued operations[.] [and any
                   WTC Related Gain.]

         [e.] [f.] Nothing contained in this Agreement shall entitle Executive
                   to receive a bonus or other incentive or contingent
                   compensation from Company based on any sales or profits made
                   [(including but not limited to any WTC Related Gain or WTC
                   Related Carry-Over Gain realized)] by Company after
                   termination of the Initial or Extended Term of this Agreement
                   or of employment hereunder.

         [f.] [g.] Notwithstanding any other provision hereof, the Board may,
                   prior to the beginning of any Fiscal Year, approve and notify
                   the Executive of a modification to the Bonus percentage
                   determined hereunder (either higher or lower), based on such
                   performance and financial measures and other factors as the
                   Board shall determine in its sole discretion. The Board's
                   decision in this regard shall be deemed final and binding on
                   Executive regardless of the amount of Target or Actual Bonus
                   otherwise calculated pursuant to the foregoing provisions. In
                   addition, the Board reserves the option at any time to grant
                   a discretionary incentive bonus, which shall not be subject
                   to the maximum Bonus provisions described in paragraph X.2.d
                   above.

Y.       SCOPE OF CERTAIN PROVISIONS: All references to Company in Paragraphs H,
         J, K, L, O.3 and R in this Agreement shall include Company, and its
         subsidiary corporations and other Company affiliates.

Z.       ENTIRE AGREEMENT: Unless otherwise specified herein, this Agreement
         sets forth every contract, understanding and arrangement as to the
         employment relationship between Executive and Company, and may only be
         changed by a written amendment signed by both Executive and Company.

         1.        The parties intend that this Agreement speak for itself, and
                   that no evidence with respect to its terms and conditions
                   other than this Agreement itself may be introduced in any
                   arbitration or judicial proceeding to interpret or enforce
                   this Agreement.

         2.        It is specifically understood and accepted that this
                   Agreement supersedes all oral and written employment
                   agreements between Executive and Company prior to the date
                   hereof, as well as all conflicting provisions of Company's
                   Guidelines for Corporate Approval and its Human Resources
                   Manual, including but not limited to the termination,
                   discipline and discharge provisions contained therein.

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                      Page 10 of 11

         3.       This Agreement may not be amended except in a writing signed
                  by the Executive and Chief Executive Officer and approved by
                  the Company's Board of Directors.

FULL KNOWLEDGE & UNDERSTANDING: Executive and Company hereby acknowledge that
they have carefully read and fully understand all terms and conditions of this
Agreement, that they have been given an opportunity to review all aspects of
this Agreement with an attorney if they so choose, and that they are voluntarily
entering into this Agreement with full knowledge of the benefits and burdens,
and the risks and rewards, contained herein.

IN WITNESS WHEREOF, Executive and an officer and Director of the Company have
executed this Agreement as of the date set forth above:

         EXECUTIVE:     Signature: _____________________________________________

                        Date:      _____________________________________________

         COMPANY:                        ABM INDUSTRIES INCORPORATED

                        Date:      _____________________________________________

                        Signature: _____________________________________________

                        Title:     _____________________________________________

                        Signature: _____________________________________________

                        Title:     _____________________________________________

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____



EXHIBIT 10.21                                                      Page 11 of 11

                                                                       EXHIBIT I

NAME OF EXECUTIVE:

                   2004 EXECUTIVE PERFORMANCE BONUS MODIFIERS
                          RATINGS AND CALCULATION SHEET
                             ABM EXECUTIVE OFFICERS



                                                             NEEDS               MEETS              EXCEEDS            SUPERIOR
                                     UNSATISFACTORY       IMPROVEMENTS        REQUIREMENTS        REQUIREMENTS        PERFORMANCE
                                                                                           
Circle one rating in each category

I.   STRATEGIC LEADERSHIP                 1          2         3        4          5         6          7        8          9

II.  FINANCIAL LEADERSHIP                 1          2         3        4          5         6          7        8          9

III. PERFORMANCE AGAINST BUDGET           1          2         3        4          5         6          7        8          9

IV.  EMPLOYEE LEADERSHIP                  1          2         3        4          5         6          7        8          9
   Employee Relations
   Staff Development
   Recruitment, Retention, Motivation
   Teamwork

V. COMPLIANCE & ADMINISTRATION            1          2         3        4          5         6          7        8          9

TOTAL RATING SCORE:                       [_]


43 - 45 points = 150% of Profit Bonus
40 - 42 points = 140% of Profit Bonus
36 - 39 points = 130% of Profit Bonus
31 - 35 points = 120% of Profit Bonus
28 - 30 points = 110% of Profit Bonus
25 - 27 points = 100% of Profit Bonus
23 - 24 points = 90% of Profit Bonus
21 - 22 points = 80% of Profit Bonus
19 - 20 points = 70% of Profit Bonus
16 - 18 points = 60% of Profit Bonus
>15 points = 50% of Profit Bonus

                                                   _____________________________
                                                   Reviewer's Signature

[Corp Exec Officer] [ Corp Officer]       INITIALS: EXECUTIVE _____ COMPANY_____

EXHIBIT 10.22                                                       Page 1 of 13

                    CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT

THIS CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made effective as
of November 1, 2003, by and between HENRIK C. SLIPSAGER ("Executive") and ABM
INDUSTRIES INCORPORATED ("Company") for itself and on behalf of its subsidiary
corporations as applicable herein.

WHEREAS, Company is engaged in the building maintenance and related service
businesses, and

WHEREAS, Executive is experienced in the administration, finance, marketing,
and/or operation of such services, and

WHEREAS, Company has invested significant time and money to develop proprietary
trade secrets and other confidential business information, as well as invaluable
goodwill among its customers, sales prospects and employees, and

WHEREAS, Executive wishes to, or has been and desires to remain employed by
Company, and to utilize such proprietary trade secrets, other confidential
business information and goodwill, and

WHEREAS, Company has disclosed or will disclose to Executive such proprietary
trade secrets and other confidential business information which Executive will
utilize in the performance of this Agreement;

NOW THEREFORE, Executive and Company agree as follows:

A.       EMPLOYMENT: Company hereby agrees to employ Executive, and Executive
         hereby accepts such employment, on the terms and conditions set forth
         in this Agreement.

B.       TITLE: Executive's title shall be President and Chief Executive Officer
         of Company, subject to modification as mutually agreed upon by both
         Company and Executive.


C.       DUTIES & RESPONSIBILITIES: Executive shall be expected to assume and
         perform such executive or managerial duties and responsibilities as are
         assigned from time-to-time by the Company's Board of Directors or its
         designated committee, to whom Executive shall report and be
         accountable.

D.       TERM OF AGREEMENT: Employment hereunder shall be deemed effective as of
         November 1, 2003, for a term of two years ("Initial Term"), unless
         sooner terminated pursuant to Paragraph O hereof, or later extended
         pursuant to Paragraph N hereof ("Extended Term").

E.       PRINCIPAL OFFICE: During the Initial Term and any Extended Term, as
         applicable, of this Agreement, Executive shall be based at a Company
         office located in San Francisco in the state of California ("State of
         Employment"), or such other location as shall be mutually agreed upon
         by Company and Executive.

F.       COMPENSATION: Company agrees to compensate Executive, and Executive
         agrees to accept as compensation in full, for Executive's assumption
         and performance of duties and responsibilities pursuant to this
         Agreement:

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                       Page 2 of 13

         1.       SALARY: A salary paid in equal installments of no less
                  frequently than semi-monthly at the annual rate set forth in
                  Paragraph X.1 hereof.

         2.       BONUS: A bonus or other incentive or contingent compensation,
                  if any, pursuant to Paragraph X.2 hereof.

         3.       FRINGE BENEFITS: Executive shall receive the then current
                  fringe benefits generally provided by Company to all of its
                  Executives. Such benefits may include but not be limited to
                  the use of a Company-leased car or a car allowance, group
                  health benefits, long-term disability benefits, group life
                  insurance, sick leave and vacation. Each of these fringe
                  benefits is subject to the applicable Company policy at all
                  times. Executive expressly agrees that should he or she
                  terminate employment with Company for the purpose of being
                  re-employed by a Company affiliate, he or she shall
                  "carry-over" any previously accrued but unused vacation
                  balance to the books of the affiliate.

                  Company reserves the right to add, increase, reduce or
                  eliminate any fringe benefit at any time, but no such benefit
                  or benefits shall be reduced or eliminated as to Executive
                  unless generally reduced or eliminated as to comparable
                  executives within the Company.

         4.       LIMIT: To the extent that any compensation to be paid to
                  Executive under this Agreement would be non-deductible by the
                  Company as a result of the $1 million compensation limit
                  provisions of Section 162(m) of the Internal Revenue Code of
                  1986, as amended (the "Code"), then such compensation shall
                  not be paid out to Executive at that time but shall instead be
                  deferred and paid without interest to Executive (subject to
                  applicable withholding and only to the extent that payment of
                  such deferred amount is fully deductible under Code Section
                  162(m)) in the first month of the taxable year following the
                  taxable year of deferral. If the subsequent payment of the
                  deferral is itself subject to further deferral pursuant to
                  this Paragraph F.4, then such further deferred amount shall
                  instead be paid in the first month of the next following
                  taxable year.

G.       PAYMENT OR REIMBURSEMENT OF BUSINESS EXPENSES: Company shall pay
         directly or reimburse Executive for reasonable business expenses of
         Company incurred by Executive in connection with Company business, and
         approved in accordance with policies and procedures adopted by the
         Audit Committee of the Board of Directors (the "Board"), upon
         presentation by Executive within sixty (60) days after incurring such
         expense of an itemized request for payment including the date, nature,
         recipient, purpose and amount of each such expense, accompanied by
         receipts for all such expenses in accordance with Company policy.

H.       BUSINESS CONDUCT: Executive shall comply with all applicable laws
         pertaining to the performance of this Agreement, and with all lawful
         and ethical rules, regulations, policies, codes of conduct, procedures
         and instructions of Company, including but not limited to the
         following:

         1.       GOOD FAITH: Executive shall not act in any way contrary to the
                  best interest of Company. Executive agrees that if he or she
                  is approached by any person to discuss a possible acquisition
                  or other transaction that could result in a change of control
                  of the Company, Executive will immediately advise the
                  Company's

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                       Page 3 of 13

                  General Counsel and Chair of the Nominating, Governance and
                  Succession Committee of the Board.

         2.       BEST EFFORTS: During all full-time employment hereunder,
                  Executive shall devote full working time and attention to
                  Company. Notwithstanding any other agreement to the contrary,
                  Executive shall not at any time be directly or indirectly
                  employed by, own, operate, assist or otherwise be involved,
                  invested or associated in any business that is similar or
                  competitive to any business of Company; except that Executive
                  may own up to five percent (5%) of such publicly-held
                  business(es), provided that Executive: (a) shall give Company
                  notice(s) of any such ownership exceeding two percent (2%), in
                  accordance with Paragraph W hereof, and (b) shall not at any
                  time be directly or indirectly employed by or operate, assist,
                  or otherwise be involved or associated with any such
                  business(es).

         3.       VERACITY: Executive shall make no claims or promises to any
                  employee, supplier, contractor, customer or sales prospect of
                  Company that are unauthorized by Company or are in any way
                  untrue.

         4.       DRIVER'S LICENSE: Executive shall have a driver's permit
                  issued by Company and shall carry a valid driver's license
                  issued by his or her state of domicile or the State of
                  Employment hereunder whenever Executive is driving any motor
                  vehicle in connection with Company business. Executive agrees
                  to immediately notify Company in writing if Executive's
                  driver's license is lost, expired, restricted, suspended or
                  revoked for any reason whatsoever.

         5.       CODE OF CONDUCT: Executive agrees to fully comply with and
                  annually execute a certification of compliance with the
                  Company's Code of Business Conduct and Ethics.

         6.       OTHER LAWS: Executive agrees to fully comply with the other
                  laws and regulations that govern his performance and receipt
                  of compensation under this Agreement, including but not
                  limited to the provisions of Section 304 of the Sarbanes-Oxley
                  Act of 2002.

I.       NO CONFLICT: Executive represents to Company that Executive is not
         bound by any contract with a previous employer or with any other
         business that might prevent Executive from entering into this
         Agreement. Executive further represents that he or she is not bound by
         any other contracts or covenants that in any way restrict or limit
         Executive's activities in relation to his or her employment with
         Company that have not been fully disclosed to Company prior to the
         signing of this Agreement.

J.       COMPANY PROPERTY: Company shall, from time to time, entrust to the
         care, custody and control of Executive certain of Company's property,
         such as motor vehicles, equipment, supplies, passwords and documents.
         Such documents may include, but shall not be limited to customer lists,
         financial statements, cost data, price lists, invoices, forms,
         electronic files and media, mailing lists, contracts, reports, manuals,
         personnel files or directories, correspondence, business cards, copies
         or notes made from Company documents and documents compiled or prepared
         by Executive for Executive's use in connection with Company business.
         Executive specifically acknowledges that all such items, including
         passwords and documents, are the property of Company, notwithstanding
         their preparation, care, custody, control or possession by Executive at
         any time(s) whatsoever.

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                       Page 4 of 13

K.       GOODWILL & PROPRIETARY INFORMATION: In connection with Executive's
         employment hereunder:

         1.       PROPRIETARY INFORMATION: Executive agrees to utilize and
                  further Company's goodwill ("Goodwill") among its customers,
                  sales prospects and employees, and acknowledges that Company
                  may disclose to Executive and Executive may disclose to
                  Company, proprietary trade secrets and other confidential
                  information not in the public domain ("Proprietary
                  Information") including but not limited to specific customer
                  data such as: (a) the identity of Company's customers and
                  sales prospects, (b) the nature, extent, frequency,
                  methodology, cost, price and profit associated with its
                  services and products purchased from Company, (c) any
                  particular needs or preferences regarding its service or
                  supply requirements, (d) the names, office hours, telephone
                  numbers and street addresses of its purchasing agents or other
                  buyers, (e) its billing procedures, (f) its credit limits and
                  payment practices, and (g) its organization structure.

         2.       DUTY OF LOYALTY: Executive agrees that such Proprietary
                  Information and Goodwill have unique value to Company, are not
                  generally known or readily available to Company's competitors,
                  and could only be developed by others after investing
                  significant time and money. Company would not make such
                  Proprietary Information and Goodwill available to Executive
                  unless Company is assured that all such Proprietary
                  Information and Goodwill will be held in trust and confidence
                  by Executive. Executive hereby acknowledges that to use this
                  Proprietary Information and Goodwill except for the benefit of
                  Company would be a breach of such trust and confidence and in
                  violation of Executive's common law Duty of Loyalty to the
                  Company.

L.       RESTRICTIVE COVENANTS: In recognition of Paragraph K, above, Executive
         hereby agrees that during the Initial Term and the Extended Term, if
         any, of this Agreement, and thereafter as specifically agreed herein:

         1.       NON-SOLICITATION OF EMPLOYEES: Except in the proper
                  performance of this Agreement, Executive shall at no time
                  directly or indirectly solicit or otherwise encourage or
                  arrange for any employee to terminate employment with Company
                  while employed by the Company and for a period of one (1) year
                  following Executive's termination of employment.

         2.       NON-DISCLOSURE: Except in the proper performance of this
                  Agreement, Executive shall not directly or indirectly disclose
                  or deliver to any other person or business, any Proprietary
                  Information obtained directly or indirectly by Executive from,
                  or for, Company.

         3.       NON-SOLICITATION OF CUSTOMERS BY UNFAIR PRACTICES: Executive
                  agrees that at all times after the termination of this
                  Agreement, Executive shall not seek, solicit, divert, take
                  away, obtain or accept the patronage of any customer or sales
                  prospect of Company through the direct or indirect use of any
                  Proprietary Information of Company, or by any other unfair or
                  unlawful business practice.

         4.       NON-SOLICITATION: Executive agrees that for a reasonable time
                  after the termination of this Agreement, which Executive and
                  Company hereby agree to be one (1) year, Executive shall not
                  directly or indirectly, for Executive or for any

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                       Page 5 of 13

                  other person or business, seek, solicit, divert, take away,
                  obtain or accept any customer account or sales prospect with
                  which Executive had direct business involvement on behalf of
                  Company within the one (1) year period prior to termination of
                  this Agreement.

         5.       LIMITATIONS: Nothing in this Agreement shall be binding upon
                  the parties to the extent it is void or unenforceable for any
                  reason in the State of Employment, including, without
                  limitation, as a result of any law regulating competition or
                  proscribing unlawful business practices.

M.       MODIFICATION OF EMPLOYMENT: At any time during the then current Initial
         or Extended Term, as applicable, of this Agreement, a majority of the
         Board shall have the absolute right, with or without cause and without
         terminating this Agreement or Executive's employment hereunder, to
         modify the nature of Executive's employment for the remainder of the
         then current Initial or Extended Term, as applicable, of this
         Agreement, from that of a full-time employee to that of a part-time
         employee ("Modification Period"). The Modification Period shall
         commence immediately upon Company giving Executive written notice of
         such change.

         1.       MODIFICATION ACTIONS: Upon commencement of the Modification
                  Period: (a) Executive shall immediately resign as a full-time
                  employee of Company and as an officer and/or director of
                  Company and of any Company subsidiaries, as applicable, (b)
                  Executive shall promptly return all Company property in
                  Executive's possession to Company, including but not limited
                  to any motor vehicles, equipment, supplies and documents set
                  forth in Paragraph J hereof, and (c) Company shall pay
                  Executive when due any and all, previously earned but as yet
                  unpaid, salary, bonus pursuant to Paragraph X.2.c or other
                  contingent compensation, reimbursement of business expenses
                  and fringe benefits.

         2.       MODIFICATION OBLIGATIONS: During the Modification Period: (a)
                  Company shall continue to pay Executive's monthly salary
                  pursuant to Paragraph F.1 hereof, and to the extent available
                  under the Company's group insurance policies, continue to
                  provide Executive with the same group health and life
                  insurance (subject to Executive continuing to pay the employee
                  portion of any such premium) to which Executive would be
                  entitled as a full-time employee, with the understanding and
                  agreement that such monthly salary and group insurance, if
                  available, shall constitute the full extent of Company's
                  obligation to compensate Executive, (b) Executive shall not be
                  eligible or entitled to receive or participate in any bonus or
                  fringe benefits other than the aforementioned group insurance,
                  if available, (c) in the alternative, Executive may exercise
                  rights under COBRA to obtain medical insurance coverage as may
                  be available to Executive, (d) Executive shall be deemed a
                  part-time employee and not a full-time employee of Company,
                  (e) Executive shall provide Company with such occasional
                  executive or managerial services as reasonably requested by
                  the person(s) designated by the Board, except that failure to
                  render such services by reason of any physical or mental
                  illness or disability other than Total Disability or death as
                  set forth in Paragraph O.2 hereof, or unavailability because
                  of absence from the State of Employment hereunder, shall not
                  affect Executive's right to receive such salary and (f)
                  Company shall pay directly or reimburse Executive in
                  accordance with the provisions of Paragraph G hereof for
                  reasonable business expenses of Company incurred by Executive
                  in connection with such services requested by the person(s)
                  designated by the Board.

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                       Page 6 of 13

         3.       MODIFICATION PERIOD: The Modification Period shall continue
                  until the earlier of: (a) Total Disability or death as set
                  forth in Paragraph O.2 hereof, (b) termination of this
                  Agreement by Company for "just cause" as hereinafter defined,
                  (c) Executive accepting employment or receiving any other
                  compensation from operating, assisting or otherwise being
                  involved, invested or associated with any business that is
                  similar to or competitive with any business in which Company
                  is engaged on the commencement date of the Modification
                  Period, or (d) expiration of the then current Term of this
                  Agreement.

N.       EXTENSION OF EMPLOYMENT:

         1.       RENEWAL: Absent at least ninety (90) days written Notice of
                  Termination of Employment or Notice of Non-Renewal from
                  Company to Executive prior to expiration of the then current
                  Initial or Extended Term, as applicable, of this Agreement,
                  employment hereunder shall continue for an Extended Term (or
                  another Extended Term, as applicable) of one year, by which
                  Executive and Company intend that all terms and conditions of
                  this Agreement shall remain in full force and effect for
                  another twelve (12) months, except that the Base Salary as
                  defined in Paragraph X.1.a may be increased as set forth in
                  Paragraph X.1.b during the Extended Term.

         2.       NOTICE OF NON-RENEWAL: In the event that Notice of Non-Renewal
                  is given ninety (90) days prior to the expiration of the then
                  Initial or Extended Term, as applicable, of this Agreement,
                  employment shall continue on an "at will" basis following the
                  expiration of such Initial or Extended Term. In such event,
                  Company shall have the right to change the terms and
                  conditions of Executive's employment, including but not
                  limited to Executive's position and/or compensation.

O.       TERMINATION OF EMPLOYMENT:

         1.       a.       TERMINATION UPON EXPIRATION OF TERM: Subject to at
                           least ninety (90) days prior written Notice of
                           Termination of Employment, Executive's employment
                           shall terminate, with or without cause, at the
                           expiration of the then current Initial or Extended
                           Term. Company has the option, without terminating
                           this Agreement, of placing Executive on a leave of
                           absence at the full compensation set forth in
                           Paragraph F hereof, for any or all of such notice
                           period.

                  b.       TERMINATION FOR CAUSE: Except as provided in
                           Paragraph O.1.a, the Company shall have the right to
                           terminate Executive's employment hereunder at any
                           time during the then current Initial or Extended
                           Term, as applicable, of this Agreement, without
                           notice subject only to a good faith determination by
                           a majority of the Board of "just cause." "Just cause"
                           includes but is not limited to any (i) theft or
                           dishonesty, (ii) more than one instance of neglect or
                           failure to perform employment duties, (iii) more than
                           one instance of inability or unwillingness to perform
                           employment duties, (iv) insubordination, (v) abuse of
                           alcohol or other drugs or substances affecting
                           Executive's performance of his or her employment
                           duties, (vi) material and willful breach of this
                           Agreement, (vii) other misconduct, unethical or
                           unlawful activity, or for (vii) a conviction of or
                           plea of "guilty" or "no contest" to a felony under
                           the laws of the United States or any state thereof.

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                       Page 7 of 13

                  c.       VOLUNTARY TERMINATION BY EXECUTIVE: At any time
                           during the then current Initial or Extended Term, as
                           applicable, of this Agreement and with or without
                           cause, Executive may terminate employment hereunder
                           by giving Company ninety (90) days prior written
                           notice.

         2.       DISABILITY: Employment hereunder shall automatically terminate
                  upon the total disability ("Total Disability") or death of
                  Executive. Total Disability shall be deemed to occur on the
                  ninetieth (90th) consecutive or non-consecutive calendar day
                  within any twelve (12) month period that Executive is unable
                  to perform the duties set forth in Paragraph C hereof because
                  of any physical or mental illness or disability. Company shall
                  pay when due to Executive or, upon death, Executive's
                  designated beneficiary or estate, as applicable, any and all,
                  previously earned but as yet unpaid, salary, bonus pursuant to
                  Paragraph X.2.c, other contingent compensation, reimbursement
                  of business expenses and fringe benefits which would have
                  otherwise been payable to Executive under this Agreement,
                  through the end of the month in which Total Disability or
                  death occurs.

         3.       ACTIONS UPON TERMINATION: Upon termination of employment
                  hereunder, Executive shall immediately resign as an employee
                  of Company and as an officer and/or director of Company and of
                  any Company subsidiaries, as applicable. Executive shall
                  promptly return and release all Company property in
                  Executive's possession to Company, including but not limited
                  to, any motor vehicles, equipment, supplies, passwords and
                  documents set forth in Paragraph J hereof. Company shall pay
                  Executive when due any and all, previously earned but as yet
                  unpaid, salary, bonus pursuant to Paragraph X.2.c, other
                  contingent compensation, reimbursement of business expenses
                  and fringe benefits.

P.       GOVERNING LAW: This Agreement shall be interpreted and enforced in
         accordance with the laws of the State of Employment hereunder.

Q.       ARBITRATION CLAUSE:

         1.       ARBITRATION AGREEMENT: Except for the interpretation and
                  enforcement of injunctive relief pursuant to Paragraph R
                  hereof (which shall be subject to litigation in any court
                  having proper jurisdiction), any claim or dispute related to
                  or arising from this Agreement (whether based in contract or
                  tort, in law or equity) including, but not limited to, claims
                  or disputes between Executive and Company or its directors,
                  officers, employees and agents regarding Executive's
                  employment or termination of employment hereunder, or any
                  other business of Company, shall be resolved by a neutral
                  arbitrator agreed upon by both parties, through mandatory,
                  final, binding arbitration in accordance with the procedural
                  and discovery rules of the American Arbitration Association.

         2.       COST OF ARBITRATION: The cost of such arbitration shall be
                  borne by the Company. Any such arbitration must be requested
                  in writing within one (1) year from the date the party
                  initiating the arbitration knew or should have known about the
                  claim or dispute, or all claims arising from that dispute are
                  forever waived. Any such arbitration (or court proceeding as
                  applicable hereunder) shall be held in the city and/or county
                  of employment hereunder. Judgment upon the award rendered
                  through such arbitration may be entered and enforced in any
                  court having proper jurisdiction.

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                       Page 8 of 13

R.       REMEDIES & DAMAGES:

         1.       INJUNCTIVE RELIEF: The parties agree that, in the event of a
                  material breach or threatened material breach of Paragraphs K
                  and/or L hereof, the damage or imminent damage to the value of
                  Company's business shall be impractical and/or impossible to
                  estimate or ascertain, and therefore any remedy at law or in
                  damages shall be inadequate. Accordingly, the parties hereto
                  agree that Company shall be entitled to the immediate issuance
                  of a restraining order or an injunction against Executive in
                  the event of such breach or threatened breach, in addition to
                  any other relief available to Company pursuant to this
                  Agreement or under law.

         2.       DAMAGES: Executive agrees that damages resulting from any such
                  breach which involves any customer of Company shall be the
                  actual damages according to proof, as determined by an
                  arbitrator pursuant to Paragraph Q, above.

         3.       WITHHOLDING AUTHORIZATION: To the full extent permitted under
                  the laws of the State of Employment hereunder, Executive
                  authorizes Company to withhold from any severance payments
                  otherwise due to Executive and from any other funds (other
                  than wages) held for Executive's benefit by Company, any
                  damages or losses sustained by Company as a result of any
                  material breach or other material violation of this Agreement
                  by Executive, pending arbitration between the parties as
                  provided for herein.

S.       NO WAIVER: Failure by either party to enforce any term or condition of
         this Agreement at any time shall not preclude that party from enforcing
         that provision, or any other provision of this Agreement, at any later
         time.

T.       SEVERABILITY: The provisions of this Agreement are severable. If any
         arbitrator (or court as applicable hereunder) rules that any portion of
         this Agreement is invalid or unenforceable, the arbitrator's or court's
         ruling shall not affect the validity and enforceability of other
         provisions of this Agreement. It is the intent of the parties that if
         any provision of this Agreement is ruled to be overly broad, the
         arbitrator or court shall interpret such provision with as much
         permissible breadth as is allowable under law rather than consider such
         provision void.

U.       SURVIVAL: All terms and conditions of this Agreement which by
         reasonable implication are meant to survive the termination of this
         Agreement, including but not limited to the Restrictive Covenants and
         Arbitration Clause herein, shall remain in full force and effect after
         the termination of this Agreement.

V.       REPRESENTATIONS: Executive represents and agrees that he or she has
         carefully read and fully understands all of the provisions of this
         Agreement, that he or she is voluntarily entering into this Agreement
         and has been given an opportunity to review all aspects of this
         Agreement with an attorney, if he or she chooses to do so.

W.       NOTICES:

         1.       ADDRESSES: Any notice required or permitted to be given
                  pursuant to this Agreement shall be in writing and delivered
                  in person, or sent prepaid by certified mail, bonded messenger
                  or overnight express, to the party named at the address set
                  forth below or at such other address as either party may
                  hereafter designate in writing to the other party:

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                       Page 9 of 13

                  EXECUTIVE:        HENRIK C. SLIPSAGER
                                    17 Stratton Road
                                    Purchase, NY10577

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                      Page 10 of 13

                  COMPANY:          ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA  94111
                                    Attention:  Board of Directors

                  COPY:             ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA  94111
                                    Attention: General Counsel

         2.       RECEIPT. Any such Notice shall be assumed to have been
                  received when delivered in person, or forty-eight (48) hours
                  after being sent in the manner specified above.

X.       SPECIAL PROVISIONS:

         1.       BASE SALARY:

                  a.       Executive's base salary ("Base Salary") for the
                           Fiscal Year that began November 1, 2003, shall be Six
                           Hundred Seventy Seven Thousand Nine Hundred Fifty
                           dollars ($677,950), subject to the provisions
                           contained in Subparagraph b, below. The capitalized
                           term "Fiscal Year" used in this agreement means the
                           period beginning on November 1 and ending on October
                           31 of the following calendar year or such other
                           period as shall be designated by the Board as the
                           Company's fiscal year.

                  b.       Effective November 1, 2004, and at the beginning of
                           each Fiscal Year thereafter, Executive shall be
                           eligible, at the sole discretion of a majority of the
                           members of the Board determined by the Board to be
                           "independent directors" (the "Independent
                           Directors"), to receive a merit increase based on
                           Executive's job performance.

                  c.       At the sole discretion of the Independent Directors,
                           the Company may grant a salary adjustment at any time
                           for reasons deemed appropriate by the Independent
                           Directors, including but not limited to a change in
                           Executive's duties resulting in a material increase
                           in responsibility.

         2.       BONUS: Subject to pro-ration in the event of modification or
                  termination of employment hereunder and further subject to the
                  requirement set forth under Subparagraph d, below, Executive
                  shall be entitled to participate in the Company's incentive
                  compensation plan which provides for a performance-based bonus
                  ("Bonus") contingent on the achievement of corporate
                  objectives for each Fiscal Year, or partial Fiscal Year, of
                  employment hereunder during the Initial Term, and during the
                  Extended Term, if any, of this Agreement, as follows:

                  a.       A target Bonus for each Fiscal Year ("Target Bonus")
                           shall be established equal to 50% of Executive's Base
                           Salary for the Fiscal Year.. Executive's Actual Bonus
                           may range from zero percent (0%) to seventy-five
                           percent (75%) of Base Salary (the "Bonus Range") with
                           the amount earned determined based on an assessment
                           of performance against criteria (the "Performance
                           Criteria") established annually by the Executive
                           Compensation and Stock Option Committee of the Board
                           (the

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                      Page 11 of 13

                           "Committee"). Performance Criteria may include both
                           Company and individual objectives, may be both
                           qualitative and quantitative in nature and shall be
                           established and communicated to Executive no later
                           than thirty (30) days after the beginning of the
                           Fiscal Year to which they apply. The assessment of
                           Executive's performance (the "Performance
                           Assessment") for each Fiscal Year shall be the
                           responsibility of the Committee. The determination of
                           the Actual Bonus for each Fiscal Year shall be the
                           responsibility of the Independent Directors.

                  b.       The Committee reserves the right at any time to
                           adjust the Performance Criteria in the event of a
                           Significant Transaction (as defined below) during a
                           Fiscal Year and/or for any unanticipated and material
                           events that are beyond the control of the Company,
                           including but not limited to acts of god, nature, war
                           or terrorism, or changes in the rules for financial
                           reporting set forth by the Financial Accounting
                           Standards Board, the Securities and Exchange
                           Commission, rules of the New York Stock Exchange
                           and/or for any other reason which the Committee
                           determines, in good faith, to be appropriate. For
                           purposes of this Agreement, the term "Significant
                           Transaction" shall mean the Company's acquisition or
                           disposition of a business or assets which the Company
                           is required to report under Item 2 of the SEC Form
                           8-K.

                  c.       The Company shall pay Executive the Actual Bonus for
                           each Fiscal Year following completion of the audit of
                           the Company's financial statements and determination
                           of the Actual Bonus by the Independent Directors, but
                           not later than seventy-five (75) days after the end
                           of the Fiscal Year. The Company in its sole
                           discretion may pay any Actual Bonus earlier. In the
                           event of modification or termination of employment
                           hereunder, the Company shall pay Executive, within
                           seventy-five (75) days thereafter, a prorated portion
                           of the Target Bonus based on the fraction of the
                           Fiscal Year that has been completed prior to the date
                           of modification or termination.

                  d.       Absent bad faith or material error, any conclusions
                           of the Committee or the Independent Directors with
                           respect to the Performance Criteria, the Performance
                           Assessment, or the Actual Bonus shall be final and
                           binding upon Executive and Company.

                  e.       Notwithstanding the foregoing Paragraphs X.2.a,
                           X.2.b, and X.2.c, except as authorized under
                           Paragraph X.2.e no Bonus for any Fiscal Year of the
                           Company shall be payable unless the Company's
                           Earnings Per Share ("EPS") for the Fiscal Year then
                           ending is equal to or greater than eighty percent
                           (80%) of the Company's EPS for the previous Fiscal
                           Year of the Company, in each case excluding any gains
                           and losses from sales of discontinued operations and
                           any WTC Related Gain. For purposes of this Agreement,
                           the term "WTC Related Gain" shall mean the total
                           amount of all items of income included in the
                           Company's audited consolidated financial statements
                           for any Fiscal Year that result from the Company's
                           receipt of insurance proceeds or other compensation
                           or damages due to the Company's loss of property,
                           business or profits as a result of the destruction of
                           the World Trade Center on September 11, 2001.

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH



EXHIBIT 10.22                                                      Page 12 of 13

                  f.       Notwithstanding any other provision hereof, the
                           Independent Directors may, prior to the beginning of
                           any Fiscal Year, approve and notify the Executive of
                           a modification to the Target Bonus or the Bonus
                           Range. The Independent Directors' decision in this
                           regard shall be deemed final and binding on
                           Executive. In addition, the Independent Directors
                           reserve the right at any time to grant a
                           discretionary incentive bonus, which shall not be
                           subject to any maximum Bonus provisions or
                           limitations.

         3.       POST RETIREMENT HEALTH INSURANCE ASSISTANCE: If and only after
                  Executive retires from employment with Company at age
                  sixty-five (65) or later and concluding no later than ten (10)
                  years thereafter ("Consultancy Period"), the Company shall
                  provide Executive and his spouse with reimbursement for dental
                  coverage comparable to that provided to other Company
                  executive officers together with coverage commonly known as
                  Medicare Supplement or Medigap Insurance to supplement
                  Medicare coverage furnished by the federal government to
                  retirees; provided, however, that Executive and his spouse
                  shall pay Company the then current premium contribution
                  charged by Company to its executive officers for their medical
                  and dental coverage, and Company's cost of such reimbursement
                  shall not exceed a combined amount of $10,000 in any Fiscal
                  Year for Executive and his spouse, or $5,000 in the event of
                  the death of either. In the event that Executive retires,
                  dies, or otherwise terminates employment prior to age 65,
                  Company shall have no obligations under this subparagraph 3.

                  In consideration of the above, during the Consultancy Period:
                  (a) Executive shall provide Company with such occasional
                  executive or managerial services as reasonably requested by
                  the Company, (b) Company shall pay directly or reimburse
                  Executive for previously approved reasonable business expenses
                  incurred by Executive in connection with such services upon
                  presentation to Company by Executive within sixty (60) days
                  after incurring such expenses, of an itemized request for
                  payment including the date(s) and receipt(s) for all such
                  expenses in excess of twenty-five dollars ($25) each, (c)
                  Executive shall not be eligible or entitled to receive or
                  participate in any other of the Company's then current fringe
                  benefits and (d) Executive shall be deemed an independent
                  contractor and not an employee of the Company.

Y.       SCOPE OF CERTAIN PROVISIONS: All references to Company in Paragraphs H,
         J, K, L, O.3 and R in this Agreement shall include Company, and its
         subsidiary corporations and other Company affiliates.

Z.       ENTIRE AGREEMENT: Unless otherwise specified herein, this Agreement
         sets forth every contract, understanding and arrangement as to the
         employment relationship between Executive and Company, and may only be
         changed by a written amendment signed by both Executive and Company.

         1.       NO EXTERNAL EVIDENCE: The parties intend that this Agreement
                  speak for itself, and that no evidence with respect to its
                  terms and conditions other than this Agreement itself may be
                  introduced in any arbitration or judicial proceeding to
                  interpret or enforce this Agreement.

         2.       SUPERSEDES OTHER AGREEMENTS: It is specifically understood and
                  accepted that this Agreement supersedes all oral and written
                  employment agreements between Executive and Company prior to
                  the date hereof, as well as all conflicting provisions of
                  Company's Guidelines for Corporate Approval and its

                                       INITIALS: EXECUTIVE /s/HCS COMPANY /s/MCH


EXHIBIT 10.22                                                      Page 13 of 13

                  Human Resources Manual, including but not limited to the
                  termination, discipline and discharge provisions contained
                  therein.

         1.       AMENDMENTS: This Agreement may not be amended except in a
                  writing approved by the Board and signed by the Executive and
                  two (2) Independent Directors.

FULL KNOWLEDGE & UNDERSTANDING: Executive and Company hereby acknowledge that
they have carefully read and fully understand all terms and conditions of this
Agreement, that they have been given an opportunity to review all aspects of
this Agreement with an attorney if they so choose, and that they are voluntarily
entering into this Agreement with full knowledge of the benefits and burdens,
and the risks and rewards, contained herein.

IN WITNESS WHEREOF, Executive and two (2) Independent Directors have executed
this Agreement as of the date set forth above:

         EXECUTIVE:        HENRIK C. SLIPSAGER

                           Signature: /s/ Henrik C. Slipsager
                                      -------------------------------

                           Date:      December 2, 2003

         COMPANY:          ABM INDUSTRIES INCORPORATED

                           Signature: /s/ Maryellen C. Herringer
                                      -------------------------------
                                      Maryellen C. Herringer

                           Title:     Chair of the Compensation Committee
                                      Board of Directors

                           Date:      December 2, 2003

                           Signature: /s/ Charles T. Horngren
                                      -------------------------------
                                      Charles T. Horngren

                           Title:     Chair of the Audit Committee
                                      Board of Directors

                           Date:      December 2, 2003

                                      INITIALS: EXECUTIVE /s/HCS  COMPANY /s/MCH

EXHIBIT 10.23                                                       Page 1 of 11

                    CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT

THIS CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made effective as
of November 1, 2003, by and between JESS E. BENTON, III ("Executive") and ABM
INDUSTRIES INCORPORATED ("Company") for itself and on behalf of its subsidiary
corporations as applicable herein.

WHEREAS, Company is engaged in the building maintenance and related service
businesses, and

WHEREAS, Executive is experienced in the administration, finance, marketing,
and/or operation of such services, and

WHEREAS, Company has invested significant time and money to develop proprietary
trade secrets and other confidential business information, as well as invaluable
goodwill among its customers, sales prospects and employees, and

WHEREAS, Executive wishes to, or has been and desires to remain employed by
Company, and to utilize such proprietary trade secrets, other confidential
business information and goodwill, and

WHEREAS, Company has disclosed or will disclose to Executive such proprietary
trade secrets and other confidential business information which Executive will
utilize in the performance of this Agreement;

NOW THEREFORE, Executive and Company agree as follows:

A.       EMPLOYMENT: Company hereby agrees to employ Executive, and Executive
         hereby accepts such employment, on the terms and conditions set forth
         in this Agreement.

B.       TITLE: Executive's title shall be Executive Vice President and Chief
         Operations Officer, subject to modification as mutually agreed upon by
         both Company and Executive.

C.       DUTIES & RESPONSIBILITIES: Executive shall be expected to assume and
         perform such executive or managerial duties and responsibilities as are
         assigned from time-to-time by the Company's Chief Executive Officer or
         his or her designee, to whom Executive shall report and be accountable.

D.       TERM OF AGREEMENT: Employment hereunder shall be deemed effective as of
         November 1, 2003, for a term of fifteen (15) months, through January
         31, 2005 ("Initial Term"), unless sooner terminated pursuant to
         Paragraph O hereof, or later extended pursuant to Paragraph N hereof
         ("Extended Term").

E.       PRINCIPAL OFFICE: During the Initial Term and any Extended Term, as
         applicable, of this Agreement, Executive shall be based at a Company
         office located in San Francisco in the state of California ("State of
         Employment"), or such other location as shall be mutually agreed upon
         by Company and Executive.

F.       COMPENSATION: Company agrees to compensate Executive, and Executive
         agrees to accept as compensation in full, for Executive's assumption
         and performance of duties and responsibilities pursuant to this
         Agreement:

         1.       SALARY: A salary paid in equal installments of no less
                  frequently than semi-monthly at the annual rate set forth in
                  Paragraph X.1 hereof.

         2.       BONUS: A bonus or other incentive or contingent compensation,
                  if any, pursuant to Paragraph X.2 hereof.

         3.       FRINGE BENEFITS: Executive shall receive the then current
                  fringe benefits generally provided by Company to all of its
                  Executives. Such benefits may include but not be limited to
                  the use of a

Corp Exec Officer                     INITIALS: EXECUTIVE /s/JEB  COMPANY /s/DMD



EXHIBIT 10.23                                                       Page 2 of 11

                  Company-leased car or a car allowance, group health benefits,
                  long-term disability benefits, group life insurance, sick
                  leave and vacation. Each of these fringe benefits is subject
                  to the applicable Company policy at all times. Executive
                  expressly agrees that should he or she terminate employment
                  with Company for the purpose of being re-employed by a Company
                  affiliate, he or she shall "carry-over" any previously accrued
                  but unused vacation balance to the books of the affiliate.

                  Company reserves the right to add, increase, reduce or
                  eliminate any fringe benefit at any time, but no such benefit
                  or benefits shall be reduced or eliminated as to Executive
                  unless generally reduced or eliminated as to comparable
                  executives within the Company.

         4.       LIMIT: To the extent that any compensation to be paid to
                  Executive under this Agreement would be non-deductible by the
                  Company as a result of the $1 million compensation limit
                  provisions of Section 162(m) of the Internal Revenue Code of
                  1986, as amended (the "Code"), then such compensation shall
                  not be paid out to Executive at that time but shall instead be
                  deferred and paid without interest to Executive (subject to
                  applicable withholding and only to the extent that payment of
                  such deferred amount is fully deductible under Code Section
                  162(m)) in the first month of the taxable year following the
                  taxable year of deferral. If the subsequent payment of the
                  deferral is itself subject to further deferral pursuant to
                  this Paragraph F.4, then such further deferred amount shall
                  instead be paid in the first month of the next following
                  taxable year.

G.       PAYMENT OR REIMBURSEMENT OF BUSINESS EXPENSES: Company shall pay
         directly or reimburse Executive for reasonable business expenses of
         Company incurred by Executive in connection with Company business, and
         approved in writing by the person(s) to whom Executive reports pursuant
         to Paragraph C hereof, upon presentation to such person(s) by Executive
         within sixty (60) days after incurring such expense of an itemized
         request for payment including the date, nature, recipient, purpose and
         amount of each such expense, accompanied by receipts for all such
         expenses in accordance with Company policy.

H.       BUSINESS CONDUCT: Executive shall comply with all applicable laws
         pertaining to the performance of this Agreement, and with all lawful
         and ethical rules, regulations, policies, codes of conduct, procedures
         and instructions of Company, including but not limited to the
         following:

         1.       GOOD FAITH: Executive shall not act in any way contrary to the
                  best interest of Company. Executive agrees that if he or she
                  is approached by any person to discuss a possible acquisition
                  or other transaction that could result in a change of control
                  of the Company, Executive will immediately advise the
                  Company's General Counsel and Chair of the Nominating,
                  Governance and Succession Committee of the Board of Directors.

         2.       BEST EFFORTS: During all full-time employment hereunder,
                  Executive shall devote full working time and attention to
                  Company. Notwithstanding any other agreement to the contrary,
                  Executive shall not at any time be directly or indirectly
                  employed by, own, operate, assist or otherwise be involved,
                  invested or associated in any business that is similar or
                  competitive to any business of Company; except that Executive
                  may own up to five percent (5%) of such publicly-held
                  business(es), provided that Executive: (a) shall give Company
                  notice(s) of any such ownership exceeding two percent (2%), in
                  accordance with Paragraph W hereof, and (b) shall not at any
                  time be directly or indirectly employed by or operate, assist,
                  or otherwise be involved or associated with any such
                  business(es).

         3.       VERACITY: Executive shall make no claims or promises to any
                  employee, supplier, contractor, customer or sales prospect of
                  Company that are unauthorized by Company or are in any way
                  untrue.

         4.       DRIVER'S LICENSE: Executive shall have a driver's permit
                  issued by Company and shall carry a valid driver's license
                  issued by his or her state of domicile or the State of
                  Employment hereunder

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EXHIBIT 10.23                                                       Page 3 of 11

                  whenever Executive is driving any motor vehicle in connection
                  with Company business. Executive agrees to immediately notify
                  Company in writing if Executive's driver's license is lost,
                  expired, restricted, suspended or revoked for any reason
                  whatsoever.

         5.       CODE OF CONDUCT: Executive agrees to fully comply with and
                  annually execute a certification of compliance with the
                  Company's Code of Business Conduct and Ethics.

I.       NO CONFLICT: Executive represents to Company that Executive is not
         bound by any contract with a previous employer or with any other
         business that might prevent Executive from entering into this
         Agreement. Executive further represents that he or she is not bound by
         any other contracts or covenants that in any way restrict or limit
         Executive's activities in relation to his or her employment with
         Company that have not been fully disclosed to Company prior to the
         signing of this Agreement.

J.       COMPANY PROPERTY: Company shall, from time to time, entrust to the
         care, custody and control of Executive certain of Company's property,
         such as motor vehicles, equipment, supplies, passwords and documents.
         Such documents may include, but shall not be limited to customer lists,
         financial statements, cost data, price lists, invoices, forms,
         electronic files and media, mailing lists, contracts, reports, manuals,
         personnel files or directories, correspondence, business cards, copies
         or notes made from Company documents and documents compiled or prepared
         by Executive for Executive's use in connection with Company business.
         Executive specifically acknowledges that all such items, including
         passwords and documents, are the property of Company, notwithstanding
         their preparation, care, custody, control or possession by Executive at
         any time(s) whatsoever.

K.       GOODWILL & PROPRIETARY INFORMATION: In connection with Executive's
         employment hereunder:

         1.       Executive agrees to utilize and further Company's goodwill
                  ("Goodwill") among its customers, sales prospects and
                  employees, and acknowledges that Company may disclose to
                  Executive and Executive may disclose to Company, proprietary
                  trade secrets and other confidential information not in the
                  public domain ("Proprietary Information") including but not
                  limited to specific customer data such as: (a) the identity of
                  Company's customers and sales prospects, (b) the nature,
                  extent, frequency, methodology, cost, price and profit
                  associated with its services and products purchased from
                  Company, (c) any particular needs or preferences regarding its
                  service or supply requirements, (d) the names, office hours,
                  telephone numbers and street addresses of its purchasing
                  agents or other buyers, (e) its billing procedures, (f) its
                  credit limits and payment practices, and (g) its organization
                  structure.

         2.       Executive agrees that such Proprietary Information and
                  Goodwill have unique value to Company, are not generally known
                  or readily available to Company's competitors, and could only
                  be developed by others after investing significant time and
                  money. Company would not make such Proprietary Information and
                  Goodwill available to Executive unless Company is assured that
                  all such Proprietary Information and Goodwill will be held in
                  trust and confidence by Executive. Executive hereby
                  acknowledges that to use this Proprietary Information and
                  Goodwill except for the benefit of Company would be a breach
                  of such trust and confidence and in violation of Executive's
                  common law Duty of Loyalty to the Company.

L.       RESTRICTIVE COVENANTS: In recognition of Paragraph K, above, Executive
         hereby agrees that during the Initial Term and the Extended Term, if
         any, of this Agreement, and thereafter as specifically agreed herein:

         1.       Except in the proper performance of this Agreement, Executive
                  shall at no time directly or indirectly solicit or otherwise
                  encourage or arrange for any employee to terminate employment
                  with Company while employed by the Company and for a period of
                  one (1) year following Executive's termination of employment.

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EXHIBIT 10.23                                                       Page 4 of 11

         2.       Except in the proper performance of this Agreement, Executive
                  shall not directly or indirectly disclose or deliver to any
                  other person or business, any Proprietary Information obtained
                  directly or indirectly by Executive from, or for, Company.

         3.       Executive agrees that at all times after the termination of
                  this Agreement, Executive shall not seek, solicit, divert,
                  take away, obtain or accept the patronage of any customer or
                  sales prospect of Company through the direct or indirect use
                  of any Proprietary Information of Company, or by any other
                  unfair or unlawful business practice.

         4.       Executive agrees that for a reasonable time after the
                  termination of this Agreement, which Executive and Company
                  hereby agree to be one (1) year, Executive shall not directly
                  or indirectly, for Executive or for any other person or
                  business, seek, solicit, divert, take away, obtain or accept
                  any customer account or sales prospect with which Executive
                  had direct business involvement on behalf of Company within
                  the one (1) year period prior to termination of this
                  Agreement.

         5.       Nothing in this Agreement shall be binding upon the parties to
                  the extent it is void or unenforceable for any reason in the
                  State of Employment, including, without limitation, as a
                  result of any law regulating competition or proscribing
                  unlawful business practices.

M.       MODIFICATION OF EMPLOYMENT: At any time during the then current Initial
         or Extended Term, as applicable, of this Agreement, a majority of the
         Board of Directors of Company shall have the absolute right, with or
         without cause and without terminating this Agreement or Executive's
         employment hereunder, to modify the nature of Executive's employment
         for the remainder of the then current Initial or Extended Term, as
         applicable, of this Agreement, from that of a full-time employee to
         that of a part-time employee ("Modification Period"). The Modification
         Period shall commence immediately upon Company giving Executive written
         notice of such change.

         1.       Upon commencement of the Modification Period: (a) Executive
                  shall immediately resign as a full-time employee of Company
                  and as an officer and/or director of Company and of any
                  Company subsidiaries, as applicable, (b) Executive shall
                  promptly return all Company property in Executive's possession
                  to Company, including but not limited to any motor vehicles,
                  equipment, supplies and documents set forth in Paragraph J
                  hereof, and (c) Company shall pay Executive when due all
                  previously earned and vested but as yet unpaid, salary,
                  prorated Target Bonus as determined pursuant to Paragraph X.2
                  or other contingent compensation, reimbursement of business
                  expenses and fringe benefits.

         2.       During the Modification Period: (a) Company shall continue to
                  pay Executive's monthly salary pursuant to Paragraph F.1
                  hereof, and to the extent available under the Company's group
                  insurance policies, continue to provide Executive with the
                  same group health and life insurance (subject to Executive
                  continuing to pay the employee portion of any such premium) to
                  which Executive would be entitled as a full-time employee,
                  with the understanding and agreement that such monthly salary
                  and group insurance, if available, shall constitute the full
                  extent of Company's obligation to compensate Executive, (b)
                  Executive shall not be eligible or entitled to receive or
                  participate in any bonus or fringe benefits other than the
                  aforementioned group insurance, if available, (c) in the
                  alternative, Executive may exercise rights under COBRA to
                  obtain medical insurance coverage as may be available to
                  Executive, (d) Executive shall be deemed a part-time employee
                  and not a full-time employee of Company, (e) Executive shall
                  provide Company with such occasional executive or managerial
                  services as reasonably requested by the person(s) to whom
                  Executive reports pursuant to Paragraph C hereof, except that
                  failure to render such services by reason of any physical or
                  mental illness or disability other than Total Disability or
                  death as set forth in Paragraph O.2 hereof, or unavailability
                  because of absence from the State of Employment hereunder,
                  shall not affect Executive's right to receive such salary and
                  (f) Company shall pay directly or reimburse Executive in
                  accordance with the provisions of Paragraph G hereof for

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EXHIBIT 10.23                                                       Page 5 of 11

                  reasonable business expenses of Company incurred by Executive
                  in connection with such services requested by the person(s) to
                  whom Executive reports pursuant to Paragraph C hereof.

         3.       The Modification Period shall continue until the earlier of:
                  (a) Total Disability or death as set forth in Paragraph O.2
                  hereof, (b) termination of this Agreement by Company for "just
                  cause" as hereinafter defined, (c) Executive accepting
                  employment or receiving any other compensation from operating,
                  assisting or otherwise being involved, invested or associated
                  with any business that is similar to or competitive with any
                  business in which Company is engaged on the commencement date
                  of the Modification Period, or (d) expiration of the then
                  current Term of this Agreement.

N.       EXTENSION OF EMPLOYMENT:

         1.       Absent at least ninety (90) days written Notice of Termination
                  of Employment or Notice of Non-Renewal from Company to
                  Executive prior to expiration of the then current Initial or
                  Extended Term, as applicable, of this Agreement, employment
                  hereunder shall continue for an Extended Term (or another
                  Extended Term, as applicable) of one year, by which Executive
                  and Company intend that all terms and conditions of this
                  Agreement shall remain in full force and effect for another
                  twelve (12) months, except that the base salary specified in
                  Paragraph X.1.a may be increased as set forth in Paragraph
                  X.1.b during the Extended Term.

         2.       In the event that Notice of Non-Renewal is given ninety (90)
                  days prior to the expiration of the then Initial or Extended
                  Term, as applicable, of this Agreement, employment shall
                  continue on an "at will" basis following the expiration of
                  such Initial or Extended Term. In such event, Company shall
                  have the right to change the terms and conditions of
                  Executive's employment, including but not limited to
                  Executive's position and/or compensation.

O.       TERMINATION OF EMPLOYMENT:

         1.       a.       Termination Upon Expiration Of Term. Subject to at
                           least ninety (90) days prior written Notice of
                           Termination of Employment, Executive's employment
                           shall terminate, with or without cause, at the
                           expiration of the then current Initial or Extended
                           Term. Company has the option, without terminating
                           this Agreement,of placing Executive on a leave of
                           absence at the full compensation set forth in
                           Paragraph F hereof, for any or all of such notice
                           period.

                  b.       Termination For Cause. Except as provided in
                           Paragraph O.1.a, the Company shall have the right to
                           terminate Executive's employment hereunder at any
                           time during the then current Initial or Extended
                           Term, as applicable, of this Agreement, without
                           notice subject only to a good faith determination by
                           a majority of the Board of Directors of Company of
                           "just cause." "Just cause" includes but is not
                           limited to any (i) theft or dishonesty (ii) more than
                           one instance of neglect or failure to perform
                           employment duties, (iii) more than one instance of
                           inability or unwillingness to perform employment
                           duties, (iv) insubordination, (v) abuse of alcohol or
                           other drugs or substances affecting Executive's
                           performance of his or her employment duties, (vi)
                           material and willful breach of this Agreement; (vii)
                           other misconduct, unethical or unlawful activity, or
                           for (vii) a conviction of or plea of "guilty" or "no
                           contest" to a felony under the laws of the United
                           States or any state thereof.

                  c.       Voluntary Termination By Executive. At any time
                           during the then current Initial or Extended Term, as
                           applicable, of this Agreement and with or without
                           cause, Executive may terminate employment hereunder
                           by giving Company ninety (90) days prior written
                           notice.

         2.       Employment hereunder shall automatically terminate upon the
                  total disability ("Total Disability") or death of Executive.
                  Total Disability shall be deemed to occur on the ninetieth
                  (90th) consecutive

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EXHIBIT 10.23                                                       Page 6 of 11

                  or non-consecutive calendar day within any twelve (12) month
                  period that Executive is unable to perform the duties set
                  forth in Paragraph C hereof because of any physical or mental
                  illness or disability. Company shall pay when due to Executive
                  or, upon death, Executive's designated beneficiary or estate,
                  as applicable, all prorated salary, prorated Target Bonus as
                  determined pursuant to Paragraph X.2 or other contingent
                  compensation, reimbursement of business expenses and fringe
                  benefits which would have otherwise been payable to Executive
                  under this Agreement, through the end of the month in which
                  Total Disability or death occurs.

         3.       Upon termination of employment hereunder, Executive shall
                  immediately resign as an employee of Company and as an officer
                  and/or director of Company and of any Company subsidiaries, as
                  applicable. Executive shall promptly return and release all
                  Company property in Executive's possession to Company,
                  including but not limited to, any motor vehicles, equipment,
                  supplies, passwords and documents set forth in Paragraph J
                  hereof. Company shall pay Executive, when due, all previously
                  earned and vested but as yet unpaid, salary, prorated Target
                  Bonus, as determined pursuant to Paragraph X.2 or other
                  contingent compensation, reimbursement of business expenses
                  and fringe benefits.

P.       GOVERNING LAW: This Agreement shall be interpreted and enforced in
         accordance with the laws of the State of Employment hereunder.

Q.       ARBITRATION CLAUSE:

         1.       Except for the interpretation and enforcement of injunctive
                  relief pursuant to Paragraph R hereof (which shall be subject
                  to litigation in any court having proper jurisdiction), any
                  claim or dispute related to or arising from this Agreement
                  (whether based in contract or tort, in law or equity)
                  including, but not limited to, claims or disputes between
                  Executive and Company or its directors, officers, employees
                  and agents regarding Executive's employment or termination of
                  employment hereunder, or any other business of Company, shall
                  be resolved by a neutral arbitrator agreed upon by both
                  parties, through mandatory, final, binding arbitration in
                  accordance with the procedural and discovery rules of the
                  American Arbitration Association.

         2.       The cost of such arbitration shall be borne by the Company.
                  Any such arbitration must be requested in writing within one
                  (1) year from the date the party initiating the arbitration
                  knew or should have known about the claim or dispute, or all
                  claims arising from that dispute are forever waived. Any such
                  arbitration (or court proceeding as applicable hereunder)
                  shall be held in the city and/or county of employment
                  hereunder. Judgment upon the award rendered through such
                  arbitration may be entered and enforced in any court having
                  proper jurisdiction.

R.       REMEDIES & DAMAGES:

         1.       The parties agree that, in the event of a material breach or
                  threatened material breach of Paragraphs K and/or L hereof,
                  the damage or imminent damage to the value of Company's
                  business shall be impractical and/or impossible to estimate or
                  ascertain, and therefore any remedy at law or in damages shall
                  be inadequate. Accordingly, the parties hereto agree that
                  Company shall be entitled to the immediate issuance of a
                  restraining order or an injunction against Executive in the
                  event of such breach or threatened breach, in addition to any
                  other relief available to Company pursuant to this Agreement
                  or under law.

         2.       Executive agrees that damages resulting from any such breach
                  which involves any customer of Company shall be the actual
                  damages according to proof, as determined by an arbitrator
                  pursuant to Paragraph Q, above.

         3.       To the full extent permitted under the laws of the State of
                  Employment hereunder, Executive authorizes Company to withhold
                  from any severance payments otherwise due to Executive and

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EXHIBIT 10.23                                                       Page 7 of 11

                  from any other funds (other than wages) held for Executive's
                  benefit by Company, any damages or losses sustained by Company
                  as a result of any material breach or other material violation
                  of this Agreement by Executive, pending arbitration between
                  the parties as provided for herein.

S.       NO WAIVER: Failure by either party to enforce any term or condition of
         this Agreement at any time shall not preclude that party from enforcing
         that provision, or any other provision of this Agreement, at any later
         time.

T.       SEVERABILITY: The provisions of this Agreement are severable. If any
         arbitrator (or court as applicable hereunder) rules that any portion of
         this Agreement is invalid or unenforceable, the arbitrator's or court's
         ruling shall not affect the validity and enforceability of other
         provisions of this Agreement. It is the intent of the parties that if
         any provision of this Agreement is ruled to be overly broad, the
         arbitrator or court shall interpret such provision with as much
         permissible breadth as is allowable under law rather than to consider
         such provision void.

U.       SURVIVAL: All terms and conditions of this Agreement which by
         reasonable implication are meant to survive the termination of this
         Agreement, including but not limited to the Restrictive Covenants and
         Arbitration Clause herein, shall remain in full force and effect after
         the termination of this Agreement.

V.       REPRESENTATIONS: Executive represents and agrees that he or she has
         carefully read and fully understands all of the provisions of this
         Agreement, that he or she is voluntarily entering into this Agreement
         and has been given an opportunity to review all aspects of this
         Agreement with an attorney, if he or she chooses to do so.

W.       NOTICES:

         1.       Any notice required or permitted to be given pursuant to this
                  Agreement shall be in writing and delivered in person, or sent
                  prepaid by certified mail, bonded messenger or overnight
                  express, to the party named at the address set forth below or
                  at such other address as either party may hereafter designate
                  in writing to the other party:

                  EXECUTIVE:        JESS E. BENTON, III
                                    50 Orange Court
                                    Hillsborough, CA  94010

                  COMPANY:          ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA  94111
                                    Attention: Chief Executive Officer

                  COPY:             ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA  94111
                                    Attention: Chief Employment Counsel

         2.       Any such Notice shall be assumed to have been received when
                  delivered in person, or forty-eight (48) hours after being
                  sent in the manner specified above.

X.       SPECIAL PROVISIONS:

         1.       BASE SALARY:

Corp Exec Officer                     INITIALS: EXECUTIVE /s/JEB  COMPANY /s/DMD



EXHIBIT 10.23                                                       Page 8 of 11

                  a.       Four Hundred Sixty Nine Thousand Three Hundred Fifty
                           Dollars ($469,350) per year effective November 1,
                           2003 through October 31, 2004 at the monthly rate of
                           $39,112.50 payable semi-monthly.

                  b.       Effective November 1, 2004 and at the beginning of
                           each Fiscal Year thereafter, Executive shall be
                           eligible, at the sole discretion of the Company, to
                           receive a merit increase based on Executive's job
                           performance.

                  c.       At the sole discretion of the Board of Directors of
                           the Company (the "Board"), the Company may grant a
                           salary adjustment at any time for reasons deemed
                           appropriate by the Board, including but not limited
                           to a change in Executive's duties resulting in a
                           material increase in responsibility.

         2.       BONUS: Subject to proration in the event of modification or
                  termination of employment hereunder and further subject to the
                  maximum bonus payable under Subparagraph d, below, Executive
                  shall be paid a bonus ("Bonus") based on the profit ("Profit")
                  for each Fiscal Year, or partial Fiscal Year, of employment
                  hereunder during the Initial Term, and during the Extended
                  Term, if any, of this Agreement, as follows:

                  a.       A Target Bonus for each Fiscal Year shall be
                           initially calculated by multiplying Executive's bonus
                           percentage of .1643% times the Company's Profit.
                           Executive's Target Bonus shall be further subject to
                           an Executive Performance Bonus Modifier adjustment of
                           50% to 150% to determine Executive's Actual Bonus.
                           Such adjustment shall be based on criteria contained
                           in Executive's annual Performance Rating (see copy
                           attached as Exhibit I) as recommended by the
                           person(s) to whom Executive reports and reviewed and
                           approved by the Executive Officer Compensation and
                           Stock Option Committee of the Board and the Board.

                  b.       Profit for purposes of determining such Target Bonus,
                           shall be defined as the consolidated income (in
                           accordance with generally accepted accounting
                           principles) before income taxes of the Company,
                           excluding: (i) gains or losses on sales or exchanges
                           of real property or on sales or exchanges of all or
                           substantially all of the stock or assets of a
                           subsidiary corporation or any other business unit of
                           Company, (ii) gains or losses on the sales of any
                           discontinued business operations of Company, and
                           (iii) WTC Related Gain. At any time the Board of
                           Directors of the Company reserves the right to
                           further adjust Profit for purposes of determining a
                           Target Bonus in the event of a Significant
                           Transaction (as defined below) during a Fiscal Year
                           and/or for any unanticipated and material events that
                           are beyond the control of the Company, including but
                           not limited to acts of god, nature, war or terrorism,
                           or changes in the rules for financial reporting set
                           forth by the Financial Accounting Standards Board,
                           the Securities and Exchange Commission, and/or the
                           New York Stock Exchange or for any other reason which
                           the Board determines, in good faith, to be
                           appropriate.

                           Notwithstanding the foregoing, Profit for purposes of
                           determining the Target Bonus in any Fiscal Year
                           during the Initial or Extended Term of this
                           Agreement, shall include WTC Related Gain and WTC
                           Related Carry-Over Gain in an aggregate amount not to
                           exceed a maximum of $10 million per Fiscal Year. For
                           purposes of this Agreement, the term "WTC Related
                           Gain" shall mean the total amount of all items of
                           income included in the Company's audited consolidated
                           financial statements for any Fiscal Year that result
                           from the Company's receipt of insurance proceeds or
                           other compensation or damages due to the Company's
                           loss of property, business or profits as a result of
                           the destruction of the World Trade Center on
                           September 11, 2001. Also, for purposes of this
                           Agreement, the term "WTC Related Carry-Over Gain"
                           shall mean the aggregate amount of WTC Related Gain
                           not previously taken into account in determining a
                           Target Bonus for a prior Fiscal Year. Finally, for
                           purposes of this Agreement, the term "Significant
                           Transaction" shall

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EXHIBIT 10.23                                                       Page 9 of 11

                           mean the Company's acquisition or disposition of a
                           business or assets which the Company is required to
                           report under Item 2 of the SEC Form 8-K.

                  c.       The Chief Financial Officer of the Company shall
                           calculate the Profit and Target Bonus for purposes of
                           this Agreement. Company shall pay Executive the
                           Actual Bonus for the Fiscal Year, or prorated Target
                           Bonus in the event of modification or termination of
                           employment hereunder, following completion of the
                           audit of the Company's financial statements and
                           approval by the Company's Executive Officer
                           Compensation and Stock Option Committee and the
                           Company's Board of Directors, but no later than
                           seventy-five (75) days after the end of each Fiscal
                           Year. The Company in its sole discretion may pay any
                           Actual Bonus or prorated Target Bonus earlier. The
                           Actual Bonus for any partial Fiscal Year shall be
                           prorated for the fraction of the Fiscal Year for
                           which such Actual Bonus is payable. Absent bad faith
                           or material error, any calculations of the Chief
                           Financial Officer and any conclusions of the Board,
                           with respect to the amounts of the Profit, Target
                           Bonus or Actual Bonus, shall be final and binding
                           upon Executive and Company.

                  d.       Executive's maximum Actual Bonus for each Fiscal Year
                           shall be one hundred percent (100%) of the Base
                           Salary for that year as determined pursuant to this
                           Agreement. In the event of modification or
                           termination of employment hereunder, Executive's
                           prorated Target Bonus shall not exceed such percent
                           of prorated Base Salary.

                  e.       Notwithstanding the foregoing, no Bonus for any
                           Fiscal Year of the Company shall be payable unless
                           the Company's EPS for the Fiscal Year then ending is
                           equal to or greater than eighty percent (80%) of the
                           Company's EPS for the previous Fiscal Year of the
                           Company, in each case excluding gains and losses from
                           sales of discontinued operations and any WTC Related
                           Gain.

                  f.       Nothing contained in this Agreement shall entitle
                           Executive to receive a bonus or other incentive or
                           contingent compensation from Company based on any
                           sales or profits made (including but not limited to
                           any WTC Related Gain or WTC Related Carry-Over Gain
                           realized) by Company after termination of the Initial
                           or Extended Term of this Agreement or of employment
                           hereunder.

                  g.       Notwithstanding any other provision hereof, the Board
                           may, prior to the beginning of any Fiscal Year,
                           approve and notify the Executive of a modification to
                           the Bonus percentage determined hereunder (either
                           higher or lower), based on such performance and
                           financial measures and other factors as the Board
                           shall determine in its sole discretion. The Board's
                           decision in this regard shall be deemed final and
                           binding on Executive regardless of the amount of
                           Target or Actual Bonus otherwise calculated pursuant
                           to the foregoing provisions. In addition, the Board
                           reserves the option at any time to grant a
                           discretionary incentive bonus, which shall not be
                           subject to the maximum Bonus provisions described in
                           paragraph X.2.d above.

Y.       SCOPE OF CERTAIN PROVISIONS: All references to Company in Paragraphs H,
         J, K, L, O.3 and R in this Agreement shall include Company, and its
         subsidiary corporations and other Company affiliates.

Z.       ENTIRE AGREEMENT: Unless otherwise specified herein, this Agreement
         sets forth every contract, understanding and arrangement as to the
         employment relationship between Executive and Company, and may only be
         changed by a written amendment signed by both Executive and Company.

         1.       The parties intend that this Agreement speak for itself, and
                  that no evidence with respect to its terms and conditions
                  other than this Agreement itself may be introduced in any
                  arbitration or judicial proceeding to interpret or enforce
                  this Agreement.

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EXHIBIT 10.23                                                      Page 10 of 11

         2.       It is specifically understood and accepted that this Agreement
                  supersedes all oral and written employment agreements between
                  Executive and Company prior to the date hereof, as well as all
                  conflicting provisions of Company's Guidelines for Corporate
                  Approval and its Human Resources Manual, including but not
                  limited to the termination, discipline and discharge
                  provisions contained therein.

         3.       This Agreement may not be amended except in a writing signed
                  by the Executive and Chief Executive Officer and approved by
                  the Company's Board of Directors.

FULL KNOWLEDGE & UNDERSTANDING: Executive and Company hereby acknowledge that
they have carefully read and fully understand all terms and conditions of this
Agreement, that they have been given an opportunity to review all aspects of
this Agreement with an attorney if they so choose, and that they are voluntarily
entering into this Agreement with full knowledge of the benefits and burdens,
and the risks and rewards, contained herein.

IN WITNESS WHEREOF, Executive and an officer and Director of the Company have
executed this Agreement as of the date set forth above:

            EXECUTIVE:     Signature: /s/ Jess E. Benton
                                      -----------------------------------------

                           Date:      December 17, 2003

            COMPANY:             ABM INDUSTRIES INCORPORATED

                           Date:      December 8, 2003

                           Signature: /s/ Donna M. Dell
                                      -----------------------------------------

                           Title:     Sr. V.P. of Human Resources

                           Signature: /s/ Henrik C. Slipsager
                                      -----------------------------------------

                           Title:    President & CEO

Corp Exec Officer                     INITIALS: EXECUTIVE /s/JEB  COMPANY /s/DMD



EXHIBIT 10.23                                                      Page 11 of 11

                                                                       EXHIBIT I

NAME OF EXECUTIVE:               Jess E. Benton, III

                   2004 EXECUTIVE PERFORMANCE BONUS MODIFIERS
                          RATINGS AND CALCULATION SHEET
                             ABM EXECUTIVE OFFICERS



                                                              NEEDS              MEETS              EXCEEDS            SUPERIOR
                                     UNSATISFACTORY       IMPROVEMENTS        REQUIREMENTS        REQUIREMENTS        PERFORMANCE
                                                                                           
CIRCLE ONE RATING IN EACH CATEGORY

I.   STRATEGIC LEADERSHIP                  1         2         3        4          5         6          7        8          9

II.  FINANCIAL LEADERSHIP                  1         2         3        4          5         6          7        8          9

III. PERFORMANCE AGAINST BUDGET            1         2         3        4          5         6          7        8          9

IV.  EMPLOYEE LEADERSHIP                   1         2         3        4          5         6          7        8          9
  Employee Relations
  Staff Development
  Recruitment, Retention, Motivation
  Teamwork

V.     COMPLIANCE & ADMINISTRATION         1         2         3        4          5         6          7        8          9

TOTAL RATING SCORE:                        [_]


43 - 45 points = 150% of Profit Bonus
40 - 42 points = 140% of Profit Bonus
36 - 39 points = 130% of Profit Bonus
31 - 35 points = 120% of Profit Bonus
28 - 30 points = 110% of Profit Bonus
25 - 27 points = 100% of Profit Bonus
23 - 24 points = 90% of Profit Bonus
21 - 22 points = 80% of Profit Bonus
19 - 20 points = 70% of Profit Bonus
16 - 18 points = 60% of Profit Bonus
>15 points = 50% of Profit Bonus

                                              __________________________________
                                              Reviewer's Signature

Corp Exec Officer                     INITIALS: EXECUTIVE /s/JEB  COMPANY /s/DMD

EXHIBIT 10.24                                                       Page 1 of 11

                    CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT

THIS CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made effective as
of November 1, 2003, by and between JAMES P. MCCLURE ("Executive") and ABM
INDUSTRIES INCORPORATED ("Company") for itself and on behalf of its subsidiary
corporations as applicable herein.

WHEREAS, Company is engaged in the building maintenance and related service
businesses, and

WHEREAS, Executive is experienced in the administration, finance, marketing,
and/or operation of such services, and

WHEREAS, Company has invested significant time and money to develop proprietary
trade secrets and other confidential business information, as well as invaluable
goodwill among its customers, sales prospects and employees, and

WHEREAS, Executive wishes to, or has been and desires to remain employed by
Company, and to utilize such proprietary trade secrets, other confidential
business information and goodwill, and

WHEREAS, Company has disclosed or will disclose to Executive such proprietary
trade secrets and other confidential business information which Executive will
utilize in the performance of this Agreement;

NOW THEREFORE, Executive and Company agree as follows:

A.       EMPLOYMENT: Company hereby agrees to employ Executive, and Executive
         hereby accepts such employment, on the terms and conditions set forth
         in this Agreement.

B.       TITLE: Executive's title shall be Executive Vice President and
         President of ABM Janitorial Services, subject to modification as
         mutually agreed upon by both Company and Executive.

C.       DUTIES & RESPONSIBILITIES: Executive shall be expected to assume and
         perform such executive or managerial duties and responsibilities as are
         assigned from time-to-time by the Company's Chief Executive Officer or
         his or her designee, to whom Executive shall report and be accountable.

D.       TERM OF AGREEMENT: Employment hereunder shall be deemed effective as of
         November 1, 2003, for a term of two years ("Initial Term"), unless
         sooner terminated pursuant to Paragraph O hereof, or later extended
         pursuant to Paragraph N hereof ("Extended Term").

E.       PRINCIPAL OFFICE: During the Initial Term and any Extended Term, as
         applicable, of this Agreement, Executive shall be based at a Company
         office located in San Francisco in the state of California ("State of
         Employment"), or such other location as shall be mutually agreed upon
         by Company and Executive.

F.       COMPENSATION: Company agrees to compensate Executive, and Executive
         agrees to accept as compensation in full, for Executive's assumption
         and performance of duties and responsibilities pursuant to this
         Agreement:

         1.       SALARY: A salary paid in equal installments of no less
                  frequently than semi-monthly at the annual rate set forth in
                  Paragraph X.1 hereof.

         2.       BONUS: A bonus or other incentive or contingent compensation,
                  if any, pursuant to Paragraph X.2 hereof.

         3.       FRINGE BENEFITS: Executive shall receive the then current
                  fringe benefits generally provided by Company to all of its
                  Executives. Such benefits may include but not be limited to
                  the use of a

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                       Page 2 of 11

                 Company-leased car or a car allowance, group health benefits,
                 long-term disability benefits, group life insurance, sick leave
                 and vacation. Each of these fringe benefits is subject to the
                 applicable Company policy at all times. Executive expressly
                 agrees that should he or she terminate employment with Company
                 for the purpose of being re-employed by a Company affiliate, he
                 or she shall "carry-over" any previously accrued but unused
                 vacation balance to the books of the affiliate.

                 Company reserves the right to add, increase, reduce or
                 eliminate any fringe benefit at any time, but no such benefit
                 or benefits shall be reduced or eliminated as to Executive
                 unless generally reduced or eliminated as to comparable
                 executives within the Company.

         4.      LIMIT: To the extent that any compensation to be paid to
                 Executive under this Agreement would be non-deductible by the
                 Company as a result of the $1 million compensation limit
                 provisions of Section 162(m) of the Internal Revenue Code of
                 1986, as amended (the "Code"), then such compensation shall not
                 be paid out to Executive at that time but shall instead be
                 deferred and paid without interest to Executive (subject to
                 applicable withholding and only to the extent that payment of
                 such deferred amount is fully deductible under Code Section
                 162(m)) in the first month of the taxable year following the
                 taxable year of deferral. If the subsequent payment of the
                 deferral is itself subject to further deferral pursuant to this
                 Paragraph F.4, then such further deferred amount shall instead
                 be paid in the first month of the next following taxable year.

G.       PAYMENT OR REIMBURSEMENT OF BUSINESS EXPENSES: Company shall pay
         directly or reimburse Executive for reasonable business expenses of
         Company incurred by Executive in connection with Company business, and
         approved in writing by the person(s) to whom Executive reports pursuant
         to Paragraph C hereof, upon presentation to such person(s) by Executive
         within sixty (60) days after incurring such expense of an itemized
         request for payment including the date, nature, recipient, purpose and
         amount of each such expense, accompanied by receipts for all such
         expenses in accordance with Company policy.

H.       BUSINESS CONDUCT: Executive shall comply with all applicable laws
         pertaining to the performance of this Agreement, and with all lawful
         and ethical rules, regulations, policies, codes of conduct, procedures
         and instructions of Company, including but not limited to the
         following:

         1.       GOOD FAITH: Executive shall not act in any way contrary to the
                  best interest of Company. Executive agrees that if he or she
                  is approached by any person to discuss a possible acquisition
                  or other transaction that could result in a change of control
                  of the Company, Executive will immediately advise the
                  Company's General Counsel and Chair of the Nominating,
                  Governance and Succession Committee of the Board of Directors.

         2.       BEST EFFORTS: During all full-time employment hereunder,
                  Executive shall devote full working time and attention to
                  Company. Notwithstanding any other agreement to the contrary,
                  Executive shall not at any time be directly or indirectly
                  employed by, own, operate, assist or otherwise be involved,
                  invested or associated in any business that is similar or
                  competitive to any business of Company; except that Executive
                  may own up to five percent (5%) of such publicly-held
                  business(es), provided that Executive: (a) shall give Company
                  notice(s) of any such ownership exceeding two percent (2%), in
                  accordance with Paragraph W hereof, and (b) shall not at any
                  time be directly or indirectly employed by or operate, assist,
                  or otherwise be involved or associated with any such
                  business(es).

         3.       VERACITY: Executive shall make no claims or promises to any
                  employee, supplier, contractor, customer or sales prospect of
                  Company that are unauthorized by Company or are in any way
                  untrue.

         4.       DRIVER'S LICENSE: Executive shall have a driver's permit
                  issued by Company and shall carry a valid driver's license
                  issued by his or her state of domicile or the State of
                  Employment hereunder

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                       Page 3 of 11

                  whenever Executive is driving any motor vehicle in connection
                  with Company business. Executive agrees to immediately notify
                  Company in writing if Executive's driver's license is lost,
                  expired, restricted, suspended or revoked for any reason
                  whatsoever.

         5.       CODE OF CONDUCT: Executive agrees to fully comply with and
                  annually execute a certification of compliance with the
                  Company's Code of Business Conduct and Ethics.

I.       NO CONFLICT: Executive represents to Company that Executive is not
         bound by any contract with a previous employer or with any other
         business that might prevent Executive from entering into this
         Agreement. Executive further represents that he or she is not bound by
         any other contracts or covenants that in any way restrict or limit
         Executive's activities in relation to his or her employment with
         Company that have not been fully disclosed to Company prior to the
         signing of this Agreement.

J.       COMPANY PROPERTY: Company shall, from time to time, entrust to the
         care, custody and control of Executive certain of Company's property,
         such as motor vehicles, equipment, supplies, passwords and documents.
         Such documents may include, but shall not be limited to customer lists,
         financial statements, cost data, price lists, invoices, forms,
         electronic files and media, mailing lists, contracts, reports, manuals,
         personnel files or directories, correspondence, business cards, copies
         or notes made from Company documents and documents compiled or prepared
         by Executive for Executive's use in connection with Company business.
         Executive specifically acknowledges that all such items, including
         passwords and documents, are the property of Company, notwithstanding
         their preparation, care, custody, control or possession by Executive at
         any time(s) whatsoever.

K.       GOODWILL & PROPRIETARY INFORMATION: In connection with Executive's
         employment hereunder:

         1.       Executive agrees to utilize and further Company's goodwill
                  ("Goodwill") among its customers, sales prospects and
                  employees, and acknowledges that Company may disclose to
                  Executive and Executive may disclose to Company, proprietary
                  trade secrets and other confidential information not in the
                  public domain ("Proprietary Information") including but not
                  limited to specific customer data such as: (a) the identity of
                  Company's customers and sales prospects, (b) the nature,
                  extent, frequency, methodology, cost, price and profit
                  associated with its services and products purchased from
                  Company, (c) any particular needs or preferences regarding its
                  service or supply requirements, (d) the names, office hours,
                  telephone numbers and street addresses of its purchasing
                  agents or other buyers, (e) its billing procedures, (f) its
                  credit limits and payment practices, and (g) its organization
                  structure.

         2.       Executive agrees that such Proprietary Information and
                  Goodwill have unique value to Company, are not generally known
                  or readily available to Company's competitors, and could only
                  be developed by others after investing significant time and
                  money. Company would not make such Proprietary Information and
                  Goodwill available to Executive unless Company is assured that
                  all such Proprietary Information and Goodwill will be held in
                  trust and confidence by Executive. Executive hereby
                  acknowledges that to use this Proprietary Information and
                  Goodwill except for the benefit of Company would be a breach
                  of such trust and confidence and in violation of Executive's
                  common law Duty of Loyalty to the Company.

L.       RESTRICTIVE COVENANTS: In recognition of Paragraph K, above, Executive
         hereby agrees that during the Initial Term and the Extended Term, if
         any, of this Agreement, and thereafter as specifically agreed herein:

         1.       Except in the proper performance of this Agreement, Executive
                  shall at no time directly or indirectly solicit or otherwise
                  encourage or arrange for any employee to terminate employment
                  with Company while employed by the Company and for a period of
                  one (1) year following Executive's termination of employment.

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                       Page 4 of 11

         2.       Except in the proper performance of this Agreement, Executive
                  shall not directly or indirectly disclose or deliver to any
                  other person or business, any Proprietary Information obtained
                  directly or indirectly by Executive from, or for, Company.

         3.       Executive agrees that at all times after the termination of
                  this Agreement, Executive shall not seek, solicit, divert,
                  take away, obtain or accept the patronage of any customer or
                  sales prospect of Company through the direct or indirect use
                  of any Proprietary Information of Company, or by any other
                  unfair or unlawful business practice.

         4.       Executive agrees that for a reasonable time after the
                  termination of this Agreement, which Executive and Company
                  hereby agree to be one (1) year, Executive shall not directly
                  or indirectly, for Executive or for any other person or
                  business, seek, solicit, divert, take away, obtain or accept
                  any customer account or sales prospect with which Executive
                  had direct business involvement on behalf of Company within
                  the one (1) year period prior to termination of this
                  Agreement.

         5.       Nothing in this Agreement shall be binding upon the parties to
                  the extent it is void or unenforceable for any reason in the
                  State of Employment, including, without limitation, as a
                  result of any law regulating competition or proscribing
                  unlawful business practices.

M.       MODIFICATION OF EMPLOYMENT: At any time during the then current Initial
         or Extended Term, as applicable, of this Agreement, a majority of the
         Board of Directors of Company shall have the absolute right, with or
         without cause and without terminating this Agreement or Executive's
         employment hereunder, to modify the nature of Executive's employment
         for the remainder of the then current Initial or Extended Term, as
         applicable, of this Agreement, from that of a full-time employee to
         that of a part-time employee ("Modification Period"). The Modification
         Period shall commence immediately upon Company giving Executive written
         notice of such change.

         1.       Upon commencement of the Modification Period: (a) Executive
                  shall immediately resign as a full-time employee of Company
                  and as an officer and/or director of Company and of any
                  Company subsidiaries, as applicable, (b) Executive shall
                  promptly return all Company property in Executive's possession
                  to Company, including but not limited to any motor vehicles,
                  equipment, supplies and documents set forth in Paragraph J
                  hereof, and (c) Company shall pay Executive when due all
                  previously earned and vested but as yet unpaid, salary,
                  prorated Target Bonus as determined pursuant to Paragraph X.2.
                  or other contingent compensation, reimbursement of business
                  expenses and fringe benefits.

         2.       During the Modification Period: (a) Company shall continue to
                  pay Executive's monthly salary pursuant to Paragraph F.1
                  hereof, and to the extent available under the Company's group
                  insurance policies, continue to provide Executive with the
                  same group health and life insurance (subject to Executive
                  continuing to pay the employee portion of any such premium) to
                  which Executive would be entitled as a full-time employee,
                  with the understanding and agreement that such monthly salary
                  and group insurance, if available, shall constitute the full
                  extent of Company's obligation to compensate Executive, (b)
                  Executive shall not be eligible or entitled to receive or
                  participate in any bonus or fringe benefits other than the
                  aforementioned group insurance, if available, (c) in the
                  alternative, Executive may exercise rights under COBRA to
                  obtain medical insurance coverage as may be available to
                  Executive, (d) Executive shall be deemed a part-time employee
                  and not a full-time employee of Company, (e) Executive shall
                  provide Company with such occasional executive or managerial
                  services as reasonably requested by the person(s) to whom
                  Executive reports pursuant to Paragraph C hereof, except that
                  failure to render such services by reason of any physical or
                  mental illness or disability other than Total Disability or
                  death as set forth in Paragraph O.2 hereof, or unavailability
                  because of absence from the State of Employment hereunder,
                  shall not affect Executive's right to receive such salary and
                  (f) Company shall pay directly or reimburse Executive in
                  accordance with the provisions of Paragraph G hereof for

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                       Page 5 of 11

                  reasonable business expenses of Company incurred by Executive
                  in connection with such services requested by the person(s) to
                  whom Executive reports pursuant to Paragraph C hereof.

         3.       The Modification Period shall continue until the earlier of:
                  (a) Total Disability or death as set forth in Paragraph O.2
                  hereof, (b) termination of this Agreement by Company for "just
                  cause" as hereinafter defined, (c) Executive accepting
                  employment or receiving any other compensation from operating,
                  assisting or otherwise being involved, invested or associated
                  with any business that is similar to or competitive with any
                  business in which Company is engaged on the commencement date
                  of the Modification Period, or (d) expiration of the then
                  current Term of this Agreement.

N.       EXTENSION OF EMPLOYMENT:

         1.       Absent at least ninety (90) days written Notice of Termination
                  of Employment or Notice of Non-Renewal from Company to
                  Executive prior to expiration of the then current Initial or
                  Extended Term, as applicable, of this Agreement, employment
                  hereunder shall continue for an Extended Term (or another
                  Extended Term, as applicable) of one year, by which Executive
                  and Company intend that all terms and conditions of this
                  Agreement shall remain in full force and effect for another
                  twelve (12) months, except that the base salary specified in
                  Paragraph X.1.a may be increased as set forth in Paragraph
                  X.1.b during the Extended Term.

         2.       In the event that Notice of Non-Renewal is given ninety (90)
                  days prior to the expiration of the then Initial or Extended
                  Term, as applicable, of this Agreement, employment shall
                  continue on an "at will" basis following the expiration of
                  such Initial or Extended Term. In such event, Company shall
                  have the right to change the terms and conditions of
                  Executive's employment, including but not limited to
                  Executive's position and/or compensation.

O.       TERMINATION OF EMPLOYMENT:

         1.       a.       Termination Upon Expiration Of Term. Subject to at
                           least ninety (90) days prior written Notice of
                           Termination of Employment, Executive's employment
                           shall terminate, with or without cause, at the
                           expiration of the then current Initial or Extended
                           Term. Company has the option, without terminating
                           this Agreement,of placing Executive on a leave of
                           absence at the full compensation set forth in
                           Paragraph F hereof, for any or all of such notice
                           period.

                  b.       Termination For Cause. Except as provided in
                           Paragraph O.1.a, the Company shall have the right to
                           terminate Executive's employment hereunder at any
                           time during the then current Initial or Extended
                           Term, as applicable, of this Agreement, without
                           notice subject only to a good faith determination by
                           a majority of the Board of Directors of Company of
                           "just cause." "Just cause" includes but is not
                           limited to any (i) theft or dishonesty (ii) more than
                           one instance of neglect or failure to perform
                           employment duties, (iii) more than one instance of
                           inability or unwillingness to perform employment
                           duties, (iv) insubordination, (v) abuse of alcohol or
                           other drugs or substances affecting Executive's
                           performance of his or her employment duties, (vi)
                           material and willful breach of this Agreement; (vii)
                           other misconduct, unethical or unlawful activity, or
                           for (vii) a conviction of or plea of "guilty" or "no
                           contest" to a felony under the laws of the United
                           States or any state thereof.

                  c.       Voluntary Termination By Executive. At any time
                           during the then current Initial or Extended Term, as
                           applicable, of this Agreement and with or without
                           cause, Executive may terminate employment hereunder
                           by giving Company ninety (90) days prior written
                           notice.

         2.       Employment hereunder shall automatically terminate upon the
                  total disability ("Total Disability") or death of Executive.
                  Total Disability shall be deemed to occur on the ninetieth
                  (90th) consecutive

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                       Page 6 of 11

                  or non-consecutive calendar day within any twelve (12) month
                  period that Executive is unable to perform the duties set
                  forth in Paragraph C hereof because of any physical or mental
                  illness or disability. Company shall pay when due to Executive
                  or, upon death, Executive's designated beneficiary or estate,
                  as applicable, all prorated salary, prorated Target Bonus as
                  determined pursuant to Paragraph X.2. or other contingent
                  compensation, reimbursement of business expenses and fringe
                  benefits which would have otherwise been payable to Executive
                  under this Agreement, through the end of the month in which
                  Total Disability or death occurs.

         3.       Upon termination of employment hereunder, Executive shall
                  immediately resign as an employee of Company and as an officer
                  and/or director of Company and of any Company subsidiaries, as
                  applicable. Executive shall promptly return and release all
                  Company property in Executive's possession to Company,
                  including but not limited to, any motor vehicles, equipment,
                  supplies, passwords and documents set forth in Paragraph J
                  hereof. Company shall pay Executive, when due, all previously
                  earned and vested but as yet unpaid, salary, prorated Target
                  Bonus, as determined pursuant to Paragraph X.2. or other
                  contingent compensation, reimbursement of business expenses
                  and fringe benefits.

P.       GOVERNING LAW: This Agreement shall be interpreted and enforced in
         accordance with the laws of the State of Employment hereunder.

Q.       ARBITRATION CLAUSE:

         1.       Except for the interpretation and enforcement of injunctive
                  relief pursuant to Paragraph R hereof (which shall be subject
                  to litigation in any court having proper jurisdiction), any
                  claim or dispute related to or arising from this Agreement
                  (whether based in contract or tort, in law or equity)
                  including, but not limited to, claims or disputes between
                  Executive and Company or its directors, officers, employees
                  and agents regarding Executive's employment or termination of
                  employment hereunder, or any other business of Company, shall
                  be resolved by a neutral arbitrator agreed upon by both
                  parties, through mandatory, final, binding arbitration in
                  accordance with the procedural and discovery rules of the
                  American Arbitration Association.

         2.       The cost of such arbitration shall be borne by the Company.
                  Any such arbitration must be requested in writing within one
                  (1) year from the date the party initiating the arbitration
                  knew or should have known about the claim or dispute, or all
                  claims arising from that dispute are forever waived. Any such
                  arbitration (or court proceeding as applicable hereunder)
                  shall be held in the city and/or county of employment
                  hereunder. Judgment upon the award rendered through such
                  arbitration may be entered and enforced in any court having
                  proper jurisdiction.

R.       REMEDIES & DAMAGES:

         1.       The parties agree that, in the event of a material breach or
                  threatened material breach of Paragraphs K and/or L hereof,
                  the damage or imminent damage to the value of Company's
                  business shall be impractical and/or impossible to estimate or
                  ascertain, and therefore any remedy at law or in damages shall
                  be inadequate. Accordingly, the parties hereto agree that
                  Company shall be entitled to the immediate issuance of a
                  restraining order or an injunction against Executive in the
                  event of such breach or threatened breach, in addition to any
                  other relief available to Company pursuant to this Agreement
                  or under law.

         2.       Executive agrees that damages resulting from any such breach
                  which involves any customer of Company shall be the actual
                  damages according to proof, as determined by an arbitrator
                  pursuant to Paragraph Q, above.

         3.       To the full extent permitted under the laws of the State of
                  Employment hereunder, Executive authorizes Company to withhold
                  from any severance payments otherwise due to Executive and

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                       Page 7 of 11

                  from any other funds (other than wages) held for Executive's
                  benefit by Company, any damages or losses sustained by Company
                  as a result of any material breach or other material violation
                  of this Agreement by Executive, pending arbitration between
                  the parties as provided for herein.

S.      NO WAIVER: Failure by either party to enforce any term or condition of
        this Agreement at any time shall not preclude that party from enforcing
        that provision, or any other provision of this Agreement, at any later
        time.

T.      SEVERABILITY: The provisions of this Agreement are severable. If any
        arbitrator (or court as applicable hereunder) rules that any portion of
        this Agreement is invalid or unenforceable, the arbitrator's or court's
        ruling shall not affect the validity and enforceability of other
        provisions of this Agreement. It is the intent of the parties that if
        any provision of this Agreement is ruled to be overly broad, the
        arbitrator or court shall interpret such provision with as much
        permissible breadth as is allowable under law rather than to consider
        such provision void.

U.      SURVIVAL: All terms and conditions of this Agreement which by reasonable
        implication are meant to survive the termination of this Agreement,
        including but not limited to the Restrictive Covenants and Arbitration
        Clause herein, shall remain in full force and effect after the
        termination of this Agreement.

V.      REPRESENTATIONS: Executive represents and agrees that he or she has
        carefully read and fully understands all of the provisions of this
        Agreement, that he or she is voluntarily entering into this Agreement
        and has been given an opportunity to review all aspects of this
        Agreement with an attorney, if he or she chooses to do so.

W.      NOTICES:

         1.       Any notice required or permitted to be given pursuant to this
                  Agreement shall be in writing and delivered in person, or sent
                  prepaid by certified mail, bonded messenger or overnight
                  express, to the party named at the address set forth below or
                  at such other address as either party may hereafter designate
                  in writing to the other party:

                  EXECUTIVE:        James P. Mcclure
                                    c/o ABM Janitorial Services
                                    160 Pacific Ave., Suite 222
                                    San Francisco, CA 94111

                  COMPANY:          ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA 94111
                                    Attention: Chief Executive Officer

                  COPY:             ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA 94111
                                    Attention: Chief Employment Counsel

         2.       Any such Notice shall be assumed to have been received when
                  delivered in person, or forty-eight (48) hours after being
                  sent in the manner specified above.

X.       SPECIAL PROVISIONS:

         1. BASE SALARY:

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                       Page 8 of 11

                  a.       Four Hundred Thirty Nine Three Hundred Dollars
                           ($439,300) per year effective November 1, 2003
                           through October 31, 2004 at the monthly rate of
                           $36,608.34 payable semi-monthly.

                  b.       Effective November 1, 2004 and at the beginning of
                           each Fiscal Year thereafter, Executive shall be
                           eligible, at the sole discretion of the Company, to
                           receive a merit increase based on Executive's job
                           performance.

                  c.       At the sole discretion of the Board of Directors of
                           the Company (the "Board"), the Company may grant a
                           salary adjustment at any time for reasons deemed
                           appropriate by the Board, including but not limited
                           to a change in Executive's duties resulting in a
                           material increase in responsibility.

         2.       BONUS: Subject to proration in the event of modification or
                  termination of employment hereunder and further subject to the
                  maximum bonus payable under Subparagraph d, below, Executive
                  shall be paid a bonus ("Bonus") based on the profit ("Profit")
                  for each Fiscal Year, or partial Fiscal Year, of employment
                  hereunder during the Initial Term, and during the Extended
                  Term, if any, of this Agreement, as follows:

                  a.       A Target Bonus for each Fiscal Year shall be
                           initially calculated by multiplying Executive's bonus
                           percentage of .2374% times the consolidated Profit of
                           the Janitorial Services subsidiaries of the Company
                           ("Janitorial Division"), excluding ABM Lakeside, Inc.
                           until such time as the operations of ABM Lakeside are
                           consolidated into American Building Maintenance Co.
                           of Illinois. The inclusion of ABM Lakeside, Inc. in
                           the determination of Profit shall be subject to the
                           approval of the Executive Officer Compensation and
                           Stock Option Committee of the Board (the
                           "Committee"). Executive's Target Bonus shall be
                           further subject to an Executive Performance Bonus
                           Modifier adjustment of 50% to 150% to determine
                           Executive's Actual Bonus. Such adjustment shall be
                           based on criteria contained in Executive's annual
                           Performance Rating (see copy attached as Exhibit I)
                           as recommended by the person(s) to whom Executive
                           reports and reviewed and approved by the Committee
                           and the Board.

                  b.       Profit for purposes of determining such Target Bonus,
                           shall be defined as the consolidated income (in
                           accordance with generally accepted accounting
                           principles) before income taxes of the Janitorial
                           Division, excluding: (i) gains or losses on sales or
                           exchanges of real property or on sales or exchanges
                           of all or substantially all of the stock or assets of
                           a subsidiary corporation or any other business unit
                           of the Janitorial Division (ii) gains or losses on
                           the sales of any discontinued business operations of
                           the Janitorial Division, and (iii) any corporate
                           charges imposed by the parent Company. At any time
                           the Board of Directors of the Company reserves the
                           right to further adjust Profit for purposes of
                           determining a Target Bonus in the event of a
                           Significant Transaction (as defined below) during a
                           Fiscal Year and/or for any unanticipated and material
                           events that are beyond the control of the Company,
                           including but not limited to acts of god, nature, war
                           or terrorism, or changes in the rules for financial
                           reporting set forth by the Financial Accounting
                           Standards Board, the Securities and Exchange
                           Commission, and/or the New York Stock Exchange or for
                           any other reason which the Board determines, in good
                           faith, to be appropriate.

                           For purposes of this Agreement, the term "Significant
                           Transaction" shall mean the Company's acquisition or
                           disposition of a business or assets which the Company
                           is required to report under Item 2 of the SEC Form
                           8-K.

                  c.       The Chief Financial Officer of the Company shall
                           calculate the Profit and Target Bonus for purposes of
                           this Agreement. Company shall pay Executive the
                           Actual Bonus for the Fiscal Year, or prorated Target
                           Bonus in the event of modification or termination of
                           employment

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                       Page 9 of 11

                           hereunder, following completion of the audit of the
                           Company's financial statements and approval by the
                           Company's Executive Officer Compensation and Stock
                           Option Committee and the Company's Board of
                           Directors, but no later than seventy-five (75) days
                           after the end of each Fiscal Year. The Company in its
                           sole discretion may pay any Actual Bonus or prorated
                           Target Bonus earlier. The Actual Bonus for any
                           partial Fiscal Year shall be prorated for the
                           fraction of the Fiscal Year for which such Actual
                           Bonus is payable. Absent bad faith or material error,
                           any calculations of the Chief Financial Officer and
                           any conclusions of the Board, with respect to the
                           amounts of the Profit, Target Bonus or Actual Bonus,
                           shall be final and binding upon Executive and
                           Company.

                  d.       Executive's maximum Actual Bonus for each Fiscal Year
                           shall be one hundred percent (100%) of the Base
                           Salary as determined pursuant to this Agreement. In
                           the event of modification or termination of
                           employment hereunder, Executive's prorated Target
                           Bonus shall not exceed such percent of prorated Base
                           Salary.

                  e.       Notwithstanding the foregoing, no Bonus for any
                           Fiscal Year of the Company shall be payable unless
                           the Company's EPS for the Fiscal Year then ending is
                           equal to or greater than eighty percent (80%) of the
                           Company's EPS for the previous Fiscal Year of the
                           Company, in each case excluding gains and losses from
                           sales of discontinued operations and any income
                           included in the Company's receipt of insurance
                           proceeds or other compensation or damages due to the
                           Company's loss of property, business or profits as a
                           result of the destruction of the World Trade Center
                           on September 11, 2001.

                  f.       Nothing contained in this Agreement shall entitle
                           Executive to receive a bonus or other incentive or
                           contingent compensation from Company based on any
                           sales or profits made by Company after termination of
                           the Initial or Extended Term of this Agreement or of
                           employment hereunder.

                  g.       Notwithstanding any other provision hereof, the Board
                           may, prior to the beginning of any Fiscal Year,
                           approve and notify the Executive of a modification to
                           the Bonus percentage determined hereunder (either
                           higher or lower), based on such performance and
                           financial measures and other factors as the Board
                           shall determine in its sole discretion. The Board's
                           decision in this regard shall be deemed final and
                           binding on Executive regardless of the amount of
                           Target or Actual Bonus otherwise calculated pursuant
                           to the foregoing provisions. In addition, the Board
                           reserves the option at any time to grant a
                           discretionary incentive bonus, which shall not be
                           subject to the maximum Bonus provisions described in
                           paragraph X.2.d above.

Y.       SCOPE OF CERTAIN PROVISIONS: All references to Company in Paragraphs H,
         J, K, L, O.3 and R in this Agreement shall include Company, and its
         subsidiary corporations and other Company affiliates.

Z.       ENTIRE AGREEMENT: Unless otherwise specified herein, this Agreement
         sets forth every contract, understanding and arrangement as to the
         employment relationship between Executive and Company, and may only be
         changed by a written amendment signed by both Executive and Company.

         1.       The parties intend that this Agreement speak for itself, and
                  that no evidence with respect to its terms and conditions
                  other than this Agreement itself may be introduced in any
                  arbitration or judicial proceeding to interpret or enforce
                  this Agreement.

         2.       It is specifically understood and accepted that this Agreement
                  supersedes all oral and written employment agreements between
                  Executive and Company prior to the date hereof, as well as all
                  conflicting provisions of Company's Guidelines for Corporate
                  Approval and its Human Resources Manual, including but not
                  limited to the termination, discipline and discharge
                  provisions contained therein.

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                      Page 10 of 11

         3.       This Agreement may not be amended except in a writing signed
                  by the Executive and Chief Executive Officer and approved by
                  the Company's Board of Directors.

FULL KNOWLEDGE & UNDERSTANDING: Executive and Company hereby acknowledge that
they have carefully read and fully understand all terms and conditions of this
Agreement, that they have been given an opportunity to review all aspects of
this Agreement with an attorney if they so choose, and that they are voluntarily
entering into this Agreement with full knowledge of the benefits and burdens,
and the risks and rewards, contained herein.

IN WITNESS WHEREOF, Executive and an officer and Director of the Company have
executed this Agreement as of the date set forth above:

            EXECUTIVE:     Signature:       /s/ James P. McClure
                                            ------------------------------------

                           Date:            12/8/03

            COMPANY:                        ABM INDUSTRIES INCORPORATED

                           Date:            12/10/03

                           Signature:       Henrik C. Slipsager
                                            ------------------------------------

                           Title:           President & CEO

                           Signature:       /s/ Donna M. Dell
                                            ------------------------------------

                           Title:           Sr. V.P. of Human Resources

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD



EXHIBIT 10.24                                                      Page 11 of 11

                                                                       EXHIBIT I

NAME OF EXECUTIVE:                      James P. McClure

                   2004 EXECUTIVE PERFORMANCE BONUS MODIFIERS
                          RATINGS AND CALCULATION SHEET
                             ABM EXECUTIVE OFFICERS



                                                              NEEDS            MEETS               EXCEEDS             SUPERIOR
                                       UNSATISFACTORY      IMPROVEMENT      REQUIREMENTS         REQUIREMENTS         PERFORMANCE
                                                                                           
CIRCLE ONE RATING IN EACH CATEGORY

I.   STRATEGIC LEADERSHIP                    1         2        3       4         5       6            7       8            9

II.  FINANCIAL LEADERSHIP                    1         2        3       4         5       6            7       8            9

III. PERFORMANCE AGAINST BUDGET              1         2        3       4         5       6            7       8            9

IV.  EMPLOYEE LEADERSHIP                     1         2        3       4         5       6            7       8            9
Employee Relations
Staff Development
Recruitment, Retention, Motivation
Teamwork

V. COMPLIANCE & ADMINISTRATION               1         2        3       4         5       6            7       8            9

TOTAL RATING SCORE:                          [_]

43 - 45 points = 150% of Profit Bonus
40 - 42 points = 140% of Profit Bonus
36 - 39 points = 130% of Profit Bonus
31 - 35 points = 120% of Profit Bonus
28 - 30 points = 110% of Profit Bonus
25 - 27 points = 100% of Profit Bonus
23 - 24 points = 90% of Profit Bonus
21 - 22 points = 80% of Profit Bonus
19 - 20 points = 70% of Profit Bonus
16 - 18 points = 60% of Profit Bonus
>15 points = 50% of Profit Bonus


                                        _______________________________________
                                        Reviewer's Signature

Corp Exec Officer                      INITIALS: EXECUTIVE /s/JPM COMPANY /s/DMD

EXHIBIT 10.25                                                       Page 1 of 11

                    CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT

THIS CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made effective as
of November 1, 2003, by and between GEORGE B. SUNDBY ("Executive") and ABM
INDUSTRIES INCORPORATED ("Company") for itself and on behalf of its subsidiary
corporations as applicable herein.

WHEREAS, Company is engaged in the building maintenance and related service
businesses, and

WHEREAS, Executive is experienced in the administration, finance, marketing,
and/or operation of such services, and

WHEREAS, Company has invested significant time and money to develop proprietary
trade secrets and other confidential business information, as well as invaluable
goodwill among its customers, sales prospects and employees, and

WHEREAS, Executive wishes to, or has been and desires to remain employed by
Company, and to utilize such proprietary trade secrets, other confidential
business information and goodwill, and

WHEREAS, Company has disclosed or will disclose to Executive such proprietary
trade secrets and other confidential business information which Executive will
utilize in the performance of this Agreement;

NOW THEREFORE, Executive and Company agree as follows:

A.       EMPLOYMENT: Company hereby agrees to employ Executive, and Executive
         hereby accepts such employment, on the terms and conditions set forth
         in this Agreement.

B.       TITLE: Executive's title shall be Senior Vice President and Chief
         Financial Officer, subject to modification as mutually agreed upon by
         both Company and Executive.

C.       DUTIES & RESPONSIBILITIES: Executive shall be expected to assume and
         perform such executive or managerial duties and responsibilities as are
         assigned from time-to-time by the Company's Chief Executive Officer or
         his or her designee, to whom Executive shall report and be accountable.

D.       TERM OF AGREEMENT: Employment hereunder shall be deemed effective as of
         November 1, 2003, for a term of two years ("Initial Term"), unless
         sooner terminated pursuant to Paragraph O hereof, or later extended
         pursuant to Paragraph N hereof ("Extended Term").

E.       PRINCIPAL OFFICE: During the Initial Term and any Extended Term, as
         applicable, of this Agreement, Executive shall be based at a Company
         office located in San Francisco in the state of California ("State of
         Employment"), or such other location as shall be mutually agreed upon
         by Company and Executive.

F.       COMPENSATION: Company agrees to compensate Executive, and Executive
         agrees to accept as compensation in full, for Executive's assumption
         and performance of duties and responsibilities pursuant to this
         Agreement:

         1.       SALARY: A salary paid in equal installments of no less
                  frequently than semi-monthly at the annual rate set forth in
                  Paragraph X.1 hereof.

         2.       BONUS: A bonus or other incentive or contingent compensation,
                  if any, pursuant to Paragraph X.2 hereof.

         3.       FRINGE BENEFITS: Executive shall receive the then current
                  fringe benefits generally provided by Company to all of its
                  Executives. Such benefits may include but not be limited to
                  the use of a Company-leased car or a car allowance, group
                  health benefits, long-term disability benefits, group

Corp Exec Officer                      INITIALS: EXECUTIVE /s/GBS COMPANY /s/HCS



EXHIBIT 10.25                                                       Page 2 of 11

                  life insurance, sick leave and vacation. Each of these fringe
                  benefits is subject to the applicable Company policy at all
                  times. Executive expressly agrees that should he or she
                  terminate employment with Company for the purpose of being
                  re-employed by a Company affiliate, he or she shall
                  "carry-over" any previously accrued but unused vacation
                  balance to the books of the affiliate.

                  Company reserves the right to add, increase, reduce or
                  eliminate any fringe benefit at any time, but no such benefit
                  or benefits shall be reduced or eliminated as to Executive
                  unless generally reduced or eliminated as to comparable
                  executives within the Company.

G.       PAYMENT OR REIMBURSEMENT OF BUSINESS EXPENSES: Company shall pay
         directly or reimburse Executive for reasonable business expenses of
         Company incurred by Executive in connection with Company business, and
         approved in writing by the person(s) to whom Executive reports pursuant
         to Paragraph C hereof, upon presentation to such person(s) by Executive
         within sixty (60) days after incurring such expense of an itemized
         request for payment including the date, nature, recipient, purpose and
         amount of each such expense, accompanied by receipts for all such
         expenses in accordance with Company policy.

H.       BUSINESS CONDUCT: Executive shall comply with all applicable laws
         pertaining to the performance of this Agreement, and with all lawful
         and ethical rules, regulations, policies, codes of conduct, procedures
         and instructions of Company, including but not limited to the
         following:

         1.       GOOD FAITH: Executive shall not act in any way contrary to the
                  best interest of Company. Executive agrees that if he or she
                  is approached by any person to discuss a possible acquisition
                  or other transaction that could result in a change of control
                  of the Company, Executive will immediately advise the
                  Company's General Counsel and Chair of the Nominating,
                  Governance and Succession Committee of the Board of Directors.

         2.       BEST EFFORTS: During all full-time employment hereunder,
                  Executive shall devote full working time and attention to
                  Company. Notwithstanding any other agreement to the contrary,
                  Executive shall not at any time be directly or indirectly
                  employed by, own, operate, assist or otherwise be involved,
                  invested or associated in any business that is similar or
                  competitive to any business of Company; except that Executive
                  may own up to five percent (5%) of such publicly-held
                  business(es), provided that Executive: (a) shall give Company
                  notice(s) of any such ownership exceeding two percent (2%), in
                  accordance with Paragraph W hereof, and (b) shall not at any
                  time be directly or indirectly employed by or operate, assist,
                  or otherwise be involved or associated with any such
                  business(es).

         3.       VERACITY: Executive shall make no claims or promises to any
                  employee, supplier, contractor, customer or sales prospect of
                  Company that are unauthorized by Company or are in any way
                  untrue.

         4.       DRIVER'S LICENSE: Executive shall have a driver's permit
                  issued by Company and shall carry a valid driver's license
                  issued by his or her state of domicile or the State of
                  Employment hereunder whenever Executive is driving any motor
                  vehicle in connection with Company business. Executive agrees
                  to immediately notify Company in writing if Executive's
                  driver's license is lost, expired, restricted, suspended or
                  revoked for any reason whatsoever.

         5.       CODE OF CONDUCT: Executive agrees to fully comply with and
                  annually execute a certification of compliance with the
                  Company's Code of Business Conduct and Ethics.

         6.       OTHER LAWS: Executive agrees to fully comply with the other
                  laws and regulations that govern his performance and the
                  receipt of compensation under this Agreement, including the
                  provisions of Section 304 of the Sarbanes-Oxley Act of 2002.

Corp Exec Officer                      INITIALS: EXECUTIVE /s/GBS COMPANY /s/HCS



EXHIBIT 10.25                                                       Page 3 of 11

I.       NO CONFLICT: Executive represents to Company that Executive is not
         bound by any contract with a previous employer or with any other
         business that might prevent Executive from entering into this
         Agreement. Executive further represents that he or she is not bound by
         any other contracts or covenants that in any way restrict or limit
         Executive's activities in relation to his or her employment with
         Company that have not been fully disclosed to Company prior to the
         signing of this Agreement.

J.       COMPANY PROPERTY: Company shall, from time to time, entrust to the
         care, custody and control of Executive certain of Company's property,
         such as motor vehicles, equipment, supplies, passwords and documents.
         Such documents may include, but shall not be limited to customer lists,
         financial statements, cost data, price lists, invoices, forms,
         electronic files and media, mailing lists, contracts, reports, manuals,
         personnel files or directories, correspondence, business cards, copies
         or notes made from Company documents and documents compiled or prepared
         by Executive for Executive's use in connection with Company business.
         Executive specifically acknowledges that all such items, including
         passwords and documents, are the property of Company, notwithstanding
         their preparation, care, custody, control or possession by Executive at
         any time(s) whatsoever.

K.       GOODWILL & PROPRIETARY INFORMATION: In connection with Executive's
         employment hereunder:

         1.       Executive agrees to utilize and further Company's goodwill
                  ("Goodwill") among its customers, sales prospects and
                  employees, and acknowledges that Company may disclose to
                  Executive and Executive may disclose to Company, proprietary
                  trade secrets and other confidential information not in the
                  public domain ("Proprietary Information") including but not
                  limited to specific customer data such as: (a) the identity of
                  Company's customers and sales prospects, (b) the nature,
                  extent, frequency, methodology, cost, price and profit
                  associated with its services and products purchased from
                  Company, (c) any particular needs or preferences regarding its
                  service or supply requirements, (d) the names, office hours,
                  telephone numbers and street addresses of its purchasing
                  agents or other buyers, (e) its billing procedures, (f) its
                  credit limits and payment practices, and (g) its organization
                  structure.

         2.       Executive agrees that such Proprietary Information and
                  Goodwill have unique value to Company, are not generally known
                  or readily available to Company's competitors, and could only
                  be developed by others after investing significant time and
                  money. Company would not make such Proprietary Information and
                  Goodwill available to Executive unless Company is assured that
                  all such Proprietary Information and Goodwill will be held in
                  trust and confidence by Executive. Executive hereby
                  acknowledges that to use this Proprietary Information and
                  Goodwill except for the benefit of Company would be a breach
                  of such trust and confidence and in violation of Executive's
                  common law Duty of Loyalty to the Company.

L.       RESTRICTIVE COVENANTS: In recognition of Paragraph K, above, Executive
         hereby agrees that during the Initial Term and the Extended Term, if
         any, of this Agreement, and thereafter as specifically agreed herein:

         1.       Except in the proper performance of this Agreement, Executive
                  shall at no time directly or indirectly solicit or otherwise
                  encourage or arrange for any employee to terminate employment
                  with Company while employed by the Company and for a period of
                  one (1) year following Executive's termination of employment.

         2.       Except in the proper performance of this Agreement, Executive
                  shall not directly or indirectly disclose or deliver to any
                  other person or business, any Proprietary Information obtained
                  directly or indirectly by Executive from, or for, Company.

         3.       Executive agrees that at all times after the termination of
                  this Agreement, Executive shall not seek, solicit, divert,
                  take away, obtain or accept the patronage of any customer or
                  sales prospect of Company through the direct or indirect use
                  of any Proprietary Information of Company, or by any other
                  unfair or unlawful business practice.

Corp Exec Officer                      INITIALS: EXECUTIVE /s/GBS COMPANY /s/HCS



EXHIBIT 10.25                                                       Page 4 of 11

         4.       Executive agrees that for a reasonable time after the
                  termination of this Agreement, which Executive and Company
                  hereby agree to be one (1) year, Executive shall not directly
                  or indirectly, for Executive or for any other person or
                  business, seek, solicit, divert, take away, obtain or accept
                  any customer account or sales prospect with which Executive
                  had direct business involvement on behalf of Company within
                  the one (1) year period prior to termination of this
                  Agreement.

         5.       Nothing in this Agreement shall be binding upon the parties to
                  the extent it is void or unenforceable for any reason in the
                  State of Employment, including, without limitation, as a
                  result of any law regulating competition or proscribing
                  unlawful business practices.

M.       MODIFICATION OF EMPLOYMENT: At any time during the then current Initial
         or Extended Term, as applicable, of this Agreement, a majority of the
         Board of Directors of Company shall have the absolute right, with or
         without cause and without terminating this Agreement or Executive's
         employment hereunder, to modify the nature of Executive's employment
         for the remainder of the then current Initial or Extended Term, as
         applicable, of this Agreement, from that of a full-time employee to
         that of a part-time employee ("Modification Period"). The Modification
         Period shall commence immediately upon Company giving Executive written
         notice of such change.

         1.       Upon commencement of the Modification Period: (a) Executive
                  shall immediately resign as a full-time employee of Company
                  and as an officer and/or director of Company and of any
                  Company subsidiaries, as applicable, (b) Executive shall
                  promptly return all Company property in Executive's possession
                  to Company, including but not limited to any motor vehicles,
                  equipment, supplies and documents set forth in Paragraph J
                  hereof, and (c) Company shall pay Executive when due all
                  previously earned and vested but as yet unpaid, salary,
                  prorated Target Bonus as determined pursuant to Paragraph X.2.
                  or other contingent compensation, reimbursement of business
                  expenses and fringe benefits.

         2.       During the Modification Period: (a) Company shall continue to
                  pay Executive's monthly salary pursuant to Paragraph F.1
                  hereof, and to the extent available under the Company's group
                  insurance policies, continue to provide Executive with the
                  same group health and life insurance (subject to Executive
                  continuing to pay the employee portion of any such premium) to
                  which Executive would be entitled as a full-time employee,
                  with the understanding and agreement that such monthly salary
                  and group insurance, if available, shall constitute the full
                  extent of Company's obligation to compensate Executive, (b)
                  Executive shall not be eligible or entitled to receive or
                  participate in any bonus or fringe benefits other than the
                  aforementioned group insurance, if available, (c) in the
                  alternative, Executive may exercise rights under COBRA to
                  obtain medical insurance coverage as may be available to
                  Executive, (d) Executive shall be deemed a part-time employee
                  and not a full-time employee of Company, (e) Executive shall
                  provide Company with such occasional executive or managerial
                  services as reasonably requested by the person(s) to whom
                  Executive reports pursuant to Paragraph C hereof, except that
                  failure to render such services by reason of any physical or
                  mental illness or disability other than Total Disability or
                  death as set forth in Paragraph O.2 hereof, or unavailability
                  because of absence from the State of Employment hereunder,
                  shall not affect Executive's right to receive such salary and
                  (f) Company shall pay directly or reimburse Executive in
                  accordance with the provisions of Paragraph G hereof for
                  reasonable business expenses of Company incurred by Executive
                  in connection with such services requested by the person(s) to
                  whom Executive reports pursuant to Paragraph C hereof.

         3.       The Modification Period shall continue until the earlier of:
                  (a) Total Disability or death as set forth in Paragraph O.2
                  hereof, (b) termination of this Agreement by Company for "just
                  cause" as hereinafter defined, (c) Executive accepting
                  employment or receiving any other compensation from operating,
                  assisting or otherwise being involved, invested or associated
                  with any business that is similar to or competitive with any
                  business in which Company is engaged on the commencement date
                  of the Modification Period, or (d) expiration of the then
                  current Term of this Agreement.

Corp Exec Officer                      INITIALS: EXECUTIVE /s/GBS COMPANY /s/HCS



EXHIBIT 10.25                                                       Page 5 of 11

N.       EXTENSION OF EMPLOYMENT:

         1.       Absent at least ninety (90) days written Notice of Termination
                  of Employment or Notice of Non-Renewal from Company to
                  Executive prior to expiration of the then current Initial or
                  Extended Term, as applicable, of this Agreement, employment
                  hereunder shall continue for an Extended Term (or another
                  Extended Term, as applicable) of one year, by which Executive
                  and Company intend that all terms and conditions of this
                  Agreement shall remain in full force and effect for another
                  twelve (12) months, except that the base salary specified in
                  Paragraph X.1.a may be increased as set forth in Paragraph
                  X.1.b during the Extended Term.

         2.       In the event that Notice of Non-Renewal is given ninety (90)
                  days prior to the expiration of the then Initial or Extended
                  Term, as applicable, of this Agreement, employment shall
                  continue on an "at will" basis following the expiration of
                  such Initial or Extended Term. In such event, Company shall
                  have the right to change the terms and conditions of
                  Executive's employment, including but not limited to
                  Executive's position and/or compensation.

O.       TERMINATION OF EMPLOYMENT:

         1.       a.       Termination Upon Expiration Of Term. Subject to at
                           least ninety (90) days prior written Notice of
                           Termination of Employment, Executive's employment
                           shall terminate, with or without cause, at the
                           expiration of the then current Initial or Extended
                           Term. Company has the option, without terminating
                           this Agreement,of placing Executive on a leave of
                           absence at the full compensation set forth in
                           Paragraph F hereof, for any or all of such notice
                           period.

                  b.       Termination For Cause. Except as provided in
                           Paragraph O.1.a, the Company shall have the right to
                           terminate Executive's employment hereunder at any
                           time during the then current Initial or Extended
                           Term, as applicable, of this Agreement, without
                           notice subject only to a good faith determination by
                           a majority of the Board of Directors of Company of
                           "just cause." "Just cause" includes but is not
                           limited to any (i) theft or dishonesty (ii) more than
                           one instance of neglect or failure to perform
                           employment duties, (iii) more than one instance of
                           inability or unwillingness to perform employment
                           duties, (iv) insubordination, (v) abuse of alcohol or
                           other drugs or substances affecting Executive's
                           performance of his or her employment duties, (vi)
                           material and willful breach of this Agreement; (vii)
                           other misconduct, unethical or unlawful activity, or
                           for (vii) a conviction of or plea of "guilty" or "no
                           contest" to a felony under the laws of the United
                           States or any state thereof.

                  c.       Voluntary Termination By Executive. At any time
                           during the then current Initial or Extended Term, as
                           applicable, of this Agreement and with or without
                           cause, Executive may terminate employment hereunder
                           by giving Company ninety (90) days prior written
                           notice.

         2.       Employment hereunder shall automatically terminate upon the
                  total disability ("Total Disability") or death of Executive.
                  Total Disability shall be deemed to occur on the ninetieth
                  (90th) consecutive or non-consecutive calendar day within any
                  twelve (12) month period that Executive is unable to perform
                  the duties set forth in Paragraph C hereof because of any
                  physical or mental illness or disability. Company shall pay
                  when due to Executive or, upon death, Executive's designated
                  beneficiary or estate, as applicable, all prorated salary,
                  prorated Target Bonus as determined pursuant to Paragraph X.2.
                  or other contingent compensation, reimbursement of business
                  expenses and fringe benefits which would have otherwise been
                  payable to Executive under this Agreement, through the end of
                  the month in which Total Disability or death occurs.

         3.       Upon termination of employment hereunder, Executive shall
                  immediately resign as an employee of Company and as an officer
                  and/or director of Company and of any Company subsidiaries, as

Corp Exec Officer                      INITIALS: EXECUTIVE /s/GBS COMPANY /s/HCS



EXHIBIT 10.25                                                       Page 6 of 11

                  applicable. Executive shall promptly return and release all
                  Company property in Executive's possession to Company,
                  including but not limited to, any motor vehicles, equipment,
                  supplies, passwords and documents set forth in Paragraph J
                  hereof. Company shall pay Executive, when due, all previously
                  earned and vested but as yet unpaid, salary, prorated Target
                  Bonus, as determined pursuant to Paragraph X.2. or other
                  contingent compensation, reimbursement of business expenses
                  and fringe benefits.

P.       GOVERNING LAW: This Agreement shall be interpreted and enforced in
         accordance with the laws of the State of Employment hereunder.

Q.       ARBITRATION CLAUSE:

         1.       Except for the interpretation and enforcement of injunctive
                  relief pursuant to Paragraph R hereof (which shall be subject
                  to litigation in any court having proper jurisdiction), any
                  claim or dispute related to or arising from this Agreement
                  (whether based in contract or tort, in law or equity)
                  including, but not limited to, claims or disputes between
                  Executive and Company or its directors, officers, employees
                  and agents regarding Executive's employment or termination of
                  employment hereunder, or any other business of Company, shall
                  be resolved by a neutral arbitrator agreed upon by both
                  parties, through mandatory, final, binding arbitration in
                  accordance with the procedural and discovery rules of the
                  American Arbitration Association.

         2.       The cost of such arbitration shall be borne by the Company.
                  Any such arbitration must be requested in writing within one
                  (1) year from the date the party initiating the arbitration
                  knew or should have known about the claim or dispute, or all
                  claims arising from that dispute are forever waived. Any such
                  arbitration (or court proceeding as applicable hereunder)
                  shall be held in the city and/or county of employment
                  hereunder. Judgment upon the award rendered through such
                  arbitration may be entered and enforced in any court having
                  proper jurisdiction.

R.       REMEDIES & DAMAGES:

         1.       The parties agree that, in the event of a material breach or
                  threatened material breach of Paragraphs K and/or L hereof,
                  the damage or imminent damage to the value of Company's
                  business shall be impractical and/or impossible to estimate or
                  ascertain, and therefore any remedy at law or in damages shall
                  be inadequate. Accordingly, the parties hereto agree that
                  Company shall be entitled to the immediate issuance of a
                  restraining order or an injunction against Executive in the
                  event of such breach or threatened breach, in addition to any
                  other relief available to Company pursuant to this Agreement
                  or under law.

         2.       Executive agrees that damages resulting from any such breach
                  which involves any customer of Company shall be the actual
                  damages according to proof, as determined by an arbitrator
                  pursuant to Paragraph Q, above.

         3.       To the full extent permitted under the laws of the State of
                  Employment hereunder, Executive authorizes Company to withhold
                  from any severance payments otherwise due to Executive and
                  from any other funds (other than wages) held for Executive's
                  benefit by Company, any damages or losses sustained by Company
                  as a result of any material breach or other material violation
                  of this Agreement by Executive, pending arbitration between
                  the parties as provided for herein.

S.      NO WAIVER: Failure by either party to enforce any term or condition of
        this Agreement at any time shall not preclude that party from enforcing
        that provision, or any other provision of this Agreement, at any later
        time.

T.      SEVERABILITY: The provisions of this Agreement are severable. If any
        arbitrator (or court as applicable hereunder) rules that any portion of
        this Agreement is invalid or unenforceable, the arbitrator's or court's
        ruling shall not affect the validity and enforceability of other
        provisions of this Agreement. It is the intent of

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EXHIBIT 10.25                                                       Page 7 of 11

        the parties that if any provision of this Agreement is ruled to be
        overly broad, the arbitrator or court shall interpret such provision
        with as much permissible breadth as is allowable under law rather than
        to consider such provision void.

U.      SURVIVAL: All terms and conditions of this Agreement which by reasonable
        implication are meant to survive the termination of this Agreement,
        including but not limited to the Restrictive Covenants and Arbitration
        Clause herein, shall remain in full force and effect after the
        termination of this Agreement.

V.      REPRESENTATIONS: Executive represents and agrees that he or she has
        carefully read and fully understands all of the provisions of this
        Agreement, that he or she is voluntarily entering into this Agreement
        and has been given an opportunity to review all aspects of this
        Agreement with an attorney, if he or she chooses to do so.

W.      NOTICES:

         1.       Any notice required or permitted to be given pursuant to this
                  Agreement shall be in writing and delivered in person, or sent
                  prepaid by certified mail, bonded messenger or overnight
                  express, to the party named at the address set forth below or
                  at such other address as either party may hereafter designate
                  in writing to the other party:

                  EXECUTIVE:        GEORGE B. SUNDBY
                                    90 Cedro Avenue
                                    San Francisco, CA 94127

                  COMPANY:          ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA 94111
                                    Attention: Chief Executive Officer

                  COPY:             ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA 94111
                                    Attention: Chief Employment Counsel

         2.       Any such Notice shall be assumed to have been received when
                  delivered in person, or forty-eight (48) hours after being
                  sent in the manner specified above.

X.       SPECIAL PROVISIONS:

         1.       BASE SALARY:

                  a.       Three Hundred Thirty One Seven Hundred Dollars
                           ($331,700) per year effective November 1, 2003
                           through October 31, 2004 at the monthly rate of
                           $27,641.67 payable semi-monthly.

                  b.       Effective November 1, 2004 and at the beginning of
                           each Fiscal Year thereafter, Executive shall be
                           eligible, at the sole discretion of the Company, to
                           receive a merit increase based on Executive's job
                           performance.

                  c.       At the sole discretion of the Board of Directors of
                           the Company (the "Board"), the Company may grant a
                           salary adjustment at any time for reasons deemed
                           appropriate by the Board, including but not limited
                           to a change in Executive's duties resulting in a
                           material increase in responsibility.

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EXHIBIT 10.25                                                       Page 8 of 11

         2.       BONUS: Subject to proration in the event of modification or
                  termination of employment hereunder and further subject to the
                  maximum bonus payable under Subparagraph d, below, Executive
                  shall be paid a bonus ("Bonus") based on the profit ("Profit")
                  for each Fiscal Year, or partial Fiscal Year, of employment
                  hereunder during the Initial Term, and during the Extended
                  Term, if any, of this Agreement, as follows:

                  a.       A Target Bonus for each Fiscal Year shall be
                           initially calculated by multiplying Executive's bonus
                           percentage of .1427% times the Company's Profit.
                           Executive's Target Bonus shall be further subject to
                           an Executive Performance Bonus Modifier adjustment of
                           50% to 150% to determine Executive's Actual Bonus.
                           Such adjustment shall be based on criteria contained
                           in Executive's annual Performance Rating (see copy
                           attached as Exhibit I) as recommended by the
                           person(s) to whom Executive reports and reviewed and
                           approved by the Executive Officer Compensation and
                           Stock Option Committee of the Board and the Board.

                  b.       Profit for purposes of determining such Target Bonus,
                           shall be defined as the consolidated income (in
                           accordance with generally accepted accounting
                           principles) before income taxes of the Company,
                           excluding: (i) gains or losses on sales or exchanges
                           of real property or on sales or exchanges of all or
                           substantially all of the stock or assets of a
                           subsidiary corporation or any other business unit of
                           Company, (ii) gains or losses on the sales of any
                           discontinued business operations of Company, and
                           (iii) WTC Related Gain. At any time the Board of
                           Directors of the Company reserves the right to
                           further adjust Profit for purposes of determining a
                           Target Bonus in the event of a Significant
                           Transaction (as defined below) during a Fiscal Year
                           and/or for any unanticipated and material events that
                           are beyond the control of the Company, including but
                           not limited to acts of god, nature, war or terrorism,
                           or changes in the rules for financial reporting set
                           forth by the Financial Accounting Standards Board,
                           the Securities and Exchange Commission, and/or the
                           New York Stock Exchange or for any other reason which
                           the Board determines, in good faith, to be
                           appropriate.

                           Notwithstanding the foregoing, Profit for purposes of
                           determining the Target Bonus in any Fiscal Year
                           during the Initial or Extended Term of this
                           Agreement, shall include WTC Related Gain and WTC
                           Related Carry-Over Gain in an aggregate amount not to
                           exceed a maximum of $10 million per Fiscal Year. For
                           purposes of this Agreement, the term "WTC Related
                           Gain" shall mean the total amount of all items of
                           income included in the Company's audited consolidated
                           financial statements for any Fiscal Year that result
                           from the Company's receipt of insurance proceeds or
                           other compensation or damages due to the Company's
                           loss of property, business or profits as a result of
                           the destruction of the World Trade Center on
                           September 11, 2001. Also, for purposes of this
                           Agreement, the term "WTC Related Carry-Over Gain"
                           shall mean the aggregate amount of WTC Related Gain
                           not previously taken into account in determining a
                           Target Bonus for a prior Fiscal Year. Finally, for
                           purposes of this Agreement, the term "Significant
                           Transaction" shall mean the Company's acquisition or
                           disposition of a business or assets which the Company
                           is required to report under Item 2 of the SEC Form
                           8-K.

                  c.       The Chief Financial Officer of the Company shall
                           calculate the Profit and Target Bonus for purposes of
                           this Agreement. Company shall pay Executive the
                           Actual Bonus for the Fiscal Year, or prorated Target
                           Bonus in the event of modification or termination of
                           employment hereunder, following completion of the
                           audit of the Company's financial statements and
                           approval by the Company's Executive Officer
                           Compensation and Stock Option Committee and the
                           Company's Board of Directors, but no later than
                           seventy-five (75) days after the end of each Fiscal
                           Year. The Company in its sole discretion may pay any
                           Actual Bonus or prorated Target Bonus earlier. The
                           Actual Bonus for any partial Fiscal Year shall be
                           prorated for the fraction of the Fiscal Year for
                           which such Actual Bonus is payable. Absent bad faith
                           or material error, any calculations of the Chief
                           Financial Officer and any

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EXHIBIT 10.25                                                       Page 9 of 11

                           conclusions of the Board, with respect to the amounts
                           of the Profit, Target Bonus or Actual Bonus, shall be
                           final and binding upon Executive and Company.

                  d.       Executive's maximum Actual Bonus for each Fiscal Year
                           shall be one hundred percent (100%) of the Base
                           Salary for that year as determined pursuant to this
                           Agreement. In the event of modification or
                           termination of employment hereunder, Executive's
                           prorated Target Bonus shall not exceed such percent
                           of prorated Base Salary.

                  e.       Notwithstanding the foregoing, no Bonus for any
                           Fiscal Year of the Company shall be payable unless
                           the Company's EPS for the Fiscal Year then ending is
                           equal to or greater than eighty percent (80%) of the
                           Company's EPS for the previous Fiscal Year of the
                           Company, in each case excluding gains and losses from
                           sales of discontinued operations and any WTC Related
                           Gain.

                  f.       Nothing contained in this Agreement shall entitle
                           Executive to receive a bonus or other incentive or
                           contingent compensation from Company based on any
                           sales or profits made (including but not limited to
                           any WTC Related Gain or WTC Related Carry-Over Gain
                           realized) by Company after termination of the Initial
                           or Extended Term of this Agreement or of employment
                           hereunder.

                  g.       Notwithstanding any other provision hereof, the Board
                           may, prior to the beginning of any Fiscal Year,
                           approve and notify the Executive of a modification to
                           the Bonus percentage determined hereunder (either
                           higher or lower), based on such performance and
                           financial measures and other factors as the Board
                           shall determine in its sole discretion. The Board's
                           decision in this regard shall be deemed final and
                           binding on Executive regardless of the amount of
                           Target or Actual Bonus otherwise calculated pursuant
                           to the foregoing provisions. In addition, the Board
                           reserves the option at any time to grant a
                           discretionary incentive bonus, which shall not be
                           subject to the maximum Bonus provisions described in
                           paragraph X.2.d above.

Y.       SCOPE OF CERTAIN PROVISIONS: All references to Company in Paragraphs H,
         J, K, L, O.3 and R in this Agreement shall include Company, and its
         subsidiary corporations and other Company affiliates.

Z.       ENTIRE AGREEMENT: Unless otherwise specified herein, this Agreement
         sets forth every contract, understanding and arrangement as to the
         employment relationship between Executive and Company, and may only be
         changed by a written amendment signed by both Executive and Company.

         1.       The parties intend that this Agreement speak for itself, and
                  that no evidence with respect to its terms and conditions
                  other than this Agreement itself may be introduced in any
                  arbitration or judicial proceeding to interpret or enforce
                  this Agreement.

         2.       It is specifically understood and accepted that this Agreement
                  supersedes all oral and written employment agreements between
                  Executive and Company prior to the date hereof, as well as all
                  conflicting provisions of Company's Guidelines for Corporate
                  Approval and its Human Resources Manual, including but not
                  limited to the termination, discipline and discharge
                  provisions contained therein.

         3.       This Agreement may not be amended except in a writing signed
                  by the Executive and Chief Executive Officer and approved by
                  the Company's Board of Directors.

FULL KNOWLEDGE & UNDERSTANDING: Executive and Company hereby acknowledge that
they have carefully read and fully understand all terms and conditions of this
Agreement, that they have been given an opportunity to review all aspects of
this Agreement with an attorney if they so choose, and that they are voluntarily

Corp Exec Officer                      INITIALS: EXECUTIVE /s/GBS COMPANY /s/HCS



EXHIBIT 10.25                                                      Page 10 of 11

entering into this Agreement with full knowledge of the benefits and burdens,
and the risks and rewards, contained herein.

IN WITNESS WHEREOF, Executive and an officer and Director of the Company have
executed this Agreement as of the date set forth above:

            EXECUTIVE:     Signature:       /s/ George B. Sundby
                                            ------------------------------------

                           Date:            November 5, 2003

            COMPANY:                        ABM INDUSTRIES INCORPORATED

                           Date:            11/3/03

                           Signature:       /s/ Henrik C. Slipsager
                                            ------------------------------------

                           Title:           President & CEO

                           Signature:       /s/ Donna M. Dell
                                            ------------------------------------

                           Title:           Sr. V.P. of Human Resources

Corp Exec Officer                      INITIALS: EXECUTIVE /s/GBS COMPANY /s/HCS



EXHIBIT 10.25                                                      Page 11 of 11

                                                                       EXHIBIT I

NAME OF EXECUTIVE:                      George B. Sundby

                   2004 EXECUTIVE PERFORMANCE BONUS MODIFIERS
                          RATINGS AND CALCULATION SHEET
                             ABM EXECUTIVE OFFICERS



                                                                  NEEDS              MEETS            EXCEEDS           SUPERIOR
                                         UNSATISFACTORY        IMPROVEMENT       REQUIREMENTS       REQUIREMENTS       PERFORMANCE
                                                                                            
CIRCLE ONE RATING IN EACH CATEGORY

I.   STRATEGIC LEADERSHIP                       1         2         3        4         5        6         7       8         9

II.  FINANCIAL LEADERSHIP                       1         2         3        4         5        6         7       8         9

III. PERFORMANCE AGAINST BUDGET                 1         2         3        4         5        6         7       8         9

IV.  EMPLOYEE LEADERSHIP                        1         2         3        4         5        6         7       8         9
Employee Relations
Staff Development
Recruitment, Retention, Motivation
Teamwork

V. COMPLIANCE & ADMINISTRATION                  1         2         3        4         5        6         7       8         9

TOTAL RATING SCORE:                            [_]

43 - 45 points = 150% of Profit Bonus
40 - 42 points = 140% of Profit Bonus
36 - 39 points = 130% of Profit Bonus
31 - 35 points = 120% of Profit Bonus
28 - 30 points = 110% of Profit Bonus
25 - 27 points = 100% of Profit Bonus
23 - 24 points = 90% of Profit Bonus
21 - 22 points = 80% of Profit Bonus
19 - 20 points = 70% of Profit Bonus
16 - 18 points = 60% of Profit Bonus
>15 points = 50% of Profit Bonus


                                        ________________________________________
                                        Reviewer's Signature

Corp Exec Officer                      INITIALS: EXECUTIVE /s/GBS COMPANY /s/HCS

EXHIBIT 10.26                                                      Page 1 of 12

                    CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT

THIS CORPORATE EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made effective as
of November 1, 2003, by and between STEVEN M. ZACCAGNINI ("Executive") and ABM
INDUSTRIES INCORPORATED ("Company") for itself and on behalf of its subsidiary
corporations as applicable herein.

WHEREAS, Company is engaged in the building maintenance and related service
businesses, and

WHEREAS, Executive is experienced in the administration, finance, marketing,
and/or operation of such services, and

WHEREAS, Company has invested significant time and money to develop proprietary
trade secrets and other confidential business information, as well as invaluable
goodwill among its customers, sales prospects and employees, and

WHEREAS, Executive wishes to, or has been and desires to remain employed by
Company, and to utilize such proprietary trade secrets, other confidential
business information and goodwill, and

WHEREAS, Company has disclosed or will disclose to Executive such proprietary
trade secrets and other confidential business information which Executive will
utilize in the performance of this Agreement;

NOW THEREFORE, Executive and Company agree as follows:

A.       EMPLOYMENT: Company hereby agrees to employ Executive, and Executive
         hereby accepts such employment, on the terms and conditions set forth
         in this Agreement.

B.       TITLE: Executive's title shall be Senior Vice President of the Company
         and President of Commair Mechanical Services and ABM Facility Services,
         subject to modification as mutually agreed upon by both Company and
         Executive.

C.       DUTIES & RESPONSIBILITIES: Executive shall be expected to assume and
         perform such executive or managerial duties and responsibilities as are
         assigned from time-to-time by the Company's Chief Operating Officer or
         his or her designee, to whom Executive shall report and be accountable.

D.       TERM OF AGREEMENT: Employment hereunder shall be deemed effective as of
         November 1, 2003, for a term of two years ("Initial Term"), unless
         sooner terminated pursuant to Paragraph O hereof, or later extended
         pursuant to Paragraph N hereof ("Extended Term").

E.       PRINCIPAL OFFICE: During the Initial Term and any Extended Term, as
         applicable, of this Agreement, Executive shall be based at a Company
         office located in San Francisco in the state of California ("State of
         Employment"), or such other location as shall be mutually agreed upon
         by Company and Executive.

F.       COMPENSATION: Company agrees to compensate Executive, and Executive
         agrees to accept as compensation in full, for Executive's assumption
         and performance of duties and responsibilities pursuant to this
         Agreement:

         1.       SALARY: A salary paid in equal installments of no less
                  frequently than semi-monthly at the annual rate set forth in
                  Paragraph X.1 hereof.

         2.       BONUS: A bonus or other incentive or contingent compensation,
                  if any, pursuant to Paragraph X.2 hereof.

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EXHIBIT 10.26                                                      Page 2 of 12

         3.       FRINGE BENEFITS: Executive shall receive the then current
                  fringe benefits generally provided by Company to all of its
                  Executives. Such benefits may include but not be limited to
                  the use of a Company-leased car or a car allowance, group
                  health benefits, long-term disability benefits, group life
                  insurance, sick leave and vacation. Each of these fringe
                  benefits is subject to the applicable Company policy at all
                  times. Executive expressly agrees that should he or she
                  terminate employment with Company for the purpose of being
                  re-employed by a Company affiliate, he or she shall
                  "carry-over" any previously accrued but unused vacation
                  balance to the books of the affiliate.

                  Company reserves the right to add, increase, reduce or
                  eliminate any fringe benefit at any time, but no such benefit
                  or benefits shall be reduced or eliminated as to Executive
                  unless generally reduced or eliminated as to comparable
                  executives within the Company.

G.       PAYMENT OR REIMBURSEMENT OF BUSINESS EXPENSES: Company shall pay
         directly or reimburse Executive for reasonable business expenses of
         Company incurred by Executive in connection with Company business, and
         approved in writing by the person(s) to whom Executive reports pursuant
         to Paragraph C hereof, upon presentation to such person(s) by Executive
         within sixty (60) days after incurring such expense of an itemized
         request for payment including the date, nature, recipient, purpose and
         amount of each such expense, accompanied by receipts for all such
         expenses in accordance with Company policy.

H.       BUSINESS CONDUCT: Executive shall comply with all applicable laws
         pertaining to the performance of this Agreement, and with all lawful
         and ethical rules, regulations, policies, codes of conduct, procedures
         and instructions of Company, including but not limited to the
         following:

         1.       GOOD FAITH: Executive shall not act in any way contrary to the
                  best interest of Company. Executive agrees that if he or she
                  is approached by any person to discuss a possible acquisition
                  or other transaction that could result in a change of control
                  of the Company, Executive will immediately advise the
                  Company's General Counsel and Chair of the Nominating,
                  Governance and Succession Committee of the Board of Directors.

         2.       BEST EFFORTS: During all full-time employment hereunder,
                  Executive shall devote full working time and attention to
                  Company. Notwithstanding any other agreement to the contrary,
                  Executive shall not at any time be directly or indirectly
                  employed by, own, operate, assist or otherwise be involved,
                  invested or associated in any business that is similar or
                  competitive to any business of Company; except that Executive
                  may own up to five percent (5%) of such publicly-held
                  business(es), provided that Executive: (a) shall give Company
                  notice(s) of any such ownership exceeding two percent (2%), in
                  accordance with Paragraph W hereof, and (b) shall not at any
                  time be directly or indirectly employed by or operate, assist,
                  or otherwise be involved or associated with any such
                  business(es).

         3.       VERACITY: Executive shall make no claims or promises to any
                  employee, supplier, contractor, customer or sales prospect of
                  Company that are unauthorized by Company or are in any way
                  untrue.

         4.       DRIVER'S LICENSE: Executive shall have a driver's permit
                  issued by Company and shall carry a valid driver's license
                  issued by his or her state of domicile or the State of
                  Employment hereunder whenever Executive is driving any motor
                  vehicle in connection with Company business. Executive agrees
                  to immediately notify Company in writing if Executive's
                  driver's license is lost, expired, restricted, suspended or
                  revoked for any reason whatsoever.

         5.       CODE OF CONDUCT: Executive agrees to fully comply with and
                  annually execute a certification of compliance with the
                  Company's Code of Business Conduct and Ethics.

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EXHIBIT 10.26                                                      Page 3 of 12

I.       NO CONFLICT: Executive represents to Company that Executive is not
         bound by any contract with a previous employer or with any other
         business that might prevent Executive from entering into this
         Agreement. Executive further represents that he or she is not bound by
         any other contracts or covenants that in any way restrict or limit
         Executive's activities in relation to his or her employment with
         Company that have not been fully disclosed to Company prior to the
         signing of this Agreement.

J.       COMPANY PROPERTY: Company shall, from time to time, entrust to the
         care, custody and control of Executive certain of Company's property,
         such as motor vehicles, equipment, supplies, passwords and documents.
         Such documents may include, but shall not be limited to customer lists,
         financial statements, cost data, price lists, invoices, forms,
         electronic files and media, mailing lists, contracts, reports, manuals,
         personnel files or directories, correspondence, business cards, copies
         or notes made from Company documents and documents compiled or prepared
         by Executive for Executive's use in connection with Company business.
         Executive specifically acknowledges that all such items, including
         passwords and documents, are the property of Company, notwithstanding
         their preparation, care, custody, control or possession by Executive at
         any time(s) whatsoever.

K.       GOODWILL & PROPRIETARY INFORMATION: In connection with Executive's
         employment hereunder:

         1.       Executive agrees to utilize and further Company's goodwill
                  ("Goodwill") among its customers, sales prospects and
                  employees, and acknowledges that Company may disclose to
                  Executive and Executive may disclose to Company, proprietary
                  trade secrets and other confidential information not in the
                  public domain ("Proprietary Information") including but not
                  limited to specific customer data such as: (a) the identity of
                  Company's customers and sales prospects, (b) the nature,
                  extent, frequency, methodology, cost, price and profit
                  associated with its services and products purchased from
                  Company, (c) any particular needs or preferences regarding its
                  service or supply requirements, (d) the names, office hours,
                  telephone numbers and street addresses of its purchasing
                  agents or other buyers, (e) its billing procedures, (f) its
                  credit limits and payment practices, and (g) its organization
                  structure.

         2.       Executive agrees that such Proprietary Information and
                  Goodwill have unique value to Company, are not generally known
                  or readily available to Company's competitors, and could only
                  be developed by others after investing significant time and
                  money. Company would not make such Proprietary Information and
                  Goodwill available to Executive unless Company is assured that
                  all such Proprietary Information and Goodwill will be held in
                  trust and confidence by Executive. Executive hereby
                  acknowledges that to use this Proprietary Information and
                  Goodwill except for the benefit of Company would be a breach
                  of such trust and confidence and in violation of Executive's
                  common law Duty of Loyalty to the Company.

L.       RESTRICTIVE COVENANTS: In recognition of Paragraph K, above, Executive
         hereby agrees that during the Initial Term and the Extended Term, if
         any, of this Agreement, and thereafter as specifically agreed herein:

         1.       Except in the proper performance of this Agreement, Executive
                  shall at no time directly or indirectly solicit or otherwise
                  encourage or arrange for any employee to terminate employment
                  with Company while employed by the Company and for a period of
                  one (1) year following Executive's termination of employment.

         2.       Except in the proper performance of this Agreement, Executive
                  shall not directly or indirectly disclose or deliver to any
                  other person or business, any Proprietary Information obtained
                  directly or indirectly by Executive from, or for, Company.

         3.       Executive agrees that at all times after the termination of
                  this Agreement, Executive shall not seek, solicit, divert,
                  take away, obtain or accept the patronage of any customer or
                  sales prospect of

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EXHIBIT 10.26                                                      Page 4 of 12

                  Company through the direct or indirect use of any Proprietary
                  Information of Company, or by any other unfair or unlawful
                  business practice.

         4.       Executive agrees that for a reasonable time after the
                  termination of this Agreement, which Executive and Company
                  hereby agree to be one (1) year, Executive shall not directly
                  or indirectly, for Executive or for any other person or
                  business, seek, solicit, divert, take away, obtain or accept
                  any customer account or sales prospect with which Executive
                  had direct business involvement on behalf of Company within
                  the one (1) year period prior to termination of this
                  Agreement.

         5.       Nothing in this Agreement shall be binding upon the parties to
                  the extent it is void or unenforceable for any reason in the
                  State of Employment, including, without limitation, as a
                  result of any law regulating competition or proscribing
                  unlawful business practices.

M.       MODIFICATION OF EMPLOYMENT: At any time during the then current Initial
         or Extended Term, as applicable, of this Agreement, a majority of the
         Board of Directors of Company shall have the absolute right, with or
         without cause and without terminating this Agreement or Executive's
         employment hereunder, to modify the nature of Executive's employment
         for the remainder of the then current Initial or Extended Term, as
         applicable, of this Agreement, from that of a full-time employee to
         that of a part-time employee ("Modification Period"). The Modification
         Period shall commence immediately upon Company giving Executive written
         notice of such change.

         1.       Upon commencement of the Modification Period: (a) Executive
                  shall immediately resign as a full-time employee of Company
                  and as an officer and/or director of Company and of any
                  Company subsidiaries, as applicable, (b) Executive shall
                  promptly return all Company property in Executive's possession
                  to Company, including but not limited to any motor vehicles,
                  equipment, supplies and documents set forth in Paragraph J
                  hereof, and (c) Company shall pay Executive when due all
                  previously earned and vested but as yet unpaid, salary,
                  prorated Target Bonus as determined pursuant to Paragraph X.2.
                  or other contingent compensation, reimbursement of business
                  expenses and fringe benefits.

         2.       During the Modification Period: (a) Company shall continue to
                  pay Executive's monthly salary pursuant to Paragraph F.1
                  hereof, and to the extent available under the Company's group
                  insurance policies, continue to provide Executive with the
                  same group health and life insurance (subject to Executive
                  continuing to pay the employee portion of any such premium) to
                  which Executive would be entitled as a full-time employee,
                  with the understanding and agreement that such monthly salary
                  and group insurance, if available, shall constitute the full
                  extent of Company's obligation to compensate Executive, (b)
                  Executive shall not be eligible or entitled to receive or
                  participate in any bonus or fringe benefits other than the
                  aforementioned group insurance, if available, (c) in the
                  alternative, Executive may exercise rights under COBRA to
                  obtain medical insurance coverage as may be available to
                  Executive, (d) Executive shall be deemed a part-time employee
                  and not a full-time employee of Company, (e) Executive shall
                  provide Company with such occasional executive or managerial
                  services as reasonably requested by the person(s) to whom
                  Executive reports pursuant to Paragraph C hereof, except that
                  failure to render such services by reason of any physical or
                  mental illness or disability other than Total Disability or
                  death as set forth in Paragraph O.2 hereof, or unavailability
                  because of absence from the State of Employment hereunder,
                  shall not affect Executive's right to receive such salary and
                  (f) Company shall pay directly or reimburse Executive in
                  accordance with the provisions of Paragraph G hereof for
                  reasonable business expenses of Company incurred by Executive
                  in connection with such services requested by the person(s) to
                  whom Executive reports pursuant to Paragraph C hereof.

         3.       The Modification Period shall continue until the earlier of:
                  (a) Total Disability or death as set forth in Paragraph O.2
                  hereof, (b) termination of this Agreement by Company for "just
                  cause" as hereinafter defined, (c) Executive accepting
                  employment or receiving any other compensation from operating,
                  assisting or otherwise being involved, invested or associated
                  with any business that is

Corp Exec Officer                      INITIALS: EXECUTIVE /s/SMZ COMPANY /s/DMD



EXHIBIT 10.26                                                      Page 5 of 12

                  similar to or competitive with any business in which Company
                  is engaged on the commencement date of the Modification
                  Period, or (d) expiration of the then current Term of this
                  Agreement.

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EXHIBIT 10.26                                                      Page 6 of 12

N.       EXTENSION OF EMPLOYMENT:

         1.       Absent at least ninety (90) days written Notice of Termination
                  of Employment or Notice of Non-Renewal from Company to
                  Executive prior to expiration of the then current Initial or
                  Extended Term, as applicable, of this Agreement, employment
                  hereunder shall continue for an Extended Term (or another
                  Extended Term, as applicable) of one year, by which Executive
                  and Company intend that all terms and conditions of this
                  Agreement shall remain in full force and effect for another
                  twelve (12) months, except that the base salary specified in
                  Paragraph X.1.a may be increased as set forth in Paragraph
                  X.1.b during the Extended Term.

         2.       In the event that Notice of Non-Renewal is given ninety (90)
                  days prior to the expiration of the then Initial or Extended
                  Term, as applicable, of this Agreement, employment shall
                  continue on an "at will" basis following the expiration of
                  such Initial or Extended Term. In such event, Company shall
                  have the right to change the terms and conditions of
                  Executive's employment, including but not limited to
                  Executive's position and/or compensation.

O.       TERMINATION OF EMPLOYMENT:

         1.       a.       Termination Upon Expiration Of Term. Subject to at
                           least ninety (90) days prior written Notice of
                           Termination of Employment, Executive's employment
                           shall terminate, with or without cause, at the
                           expiration of the then current Initial or Extended
                           Term. Company has the option, without terminating
                           this Agreement, of placing Executive on a leave of
                           absence at the full compensation set forth in
                           Paragraph F hereof, for any or all of such notice
                           period.

                  b.       Termination For Cause. Except as provided in
                           Paragraph O.1.a, the Company shall have the right to
                           terminate Executive's employment hereunder at any
                           time during the then current Initial or Extended
                           Term, as applicable, of this Agreement, without
                           notice subject only to a good faith determination by
                           a majority of the Board of Directors of Company of
                           "just cause." "Just cause" includes but is not
                           limited to any (i) theft or dishonesty (ii) more than
                           one instance of neglect or failure to perform
                           employment duties, (iii) more than one instance of
                           inability or unwillingness to perform employment
                           duties, (iv) insubordination, (v) abuse of alcohol or
                           other drugs or substances affecting Executive's
                           performance of his or her employment duties, (vi)
                           material and willful breach of this Agreement; (vii)
                           other misconduct, unethical or unlawful activity, or
                           for (vii) a conviction of or plea of "guilty" or "no
                           contest" to a felony under the laws of the United
                           States or any state thereof.

                  c.       Voluntary Termination By Executive. At any time
                           during the then current Initial or Extended Term, as
                           applicable, of this Agreement and with or without
                           cause, Executive may terminate employment hereunder
                           by giving Company ninety (90) days prior written
                           notice.

         2.       Employment hereunder shall automatically terminate upon the
                  total disability ("Total Disability") or death of Executive.
                  Total Disability shall be deemed to occur on the ninetieth
                  (90th) consecutive or non-consecutive calendar day within any
                  twelve (12) month period that Executive is unable to perform
                  the duties set forth in Paragraph C hereof because of any
                  physical or mental illness or disability. Company shall pay
                  when due to Executive or, upon death, Executive's designated
                  beneficiary or estate, as applicable, all prorated salary,
                  prorated Target Bonus as determined pursuant to Paragraph X.2.
                  or other contingent compensation, reimbursement of business
                  expenses and fringe benefits which would have otherwise been
                  payable to Executive under this Agreement, through the end of
                  the month in which Total Disability or death occurs.

         3.       Upon termination of employment hereunder, Executive shall
                  immediately resign as an employee of Company and as an officer
                  and/or director of Company and of any Company subsidiaries, as

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EXHIBIT 10.26                                                      Page 7 of 12

                  applicable. Executive shall promptly return and release all
                  Company property in Executive's possession to Company,
                  including but not limited to, any motor vehicles, equipment,
                  supplies, passwords and documents set forth in Paragraph J
                  hereof. Company shall pay Executive, when due, all previously
                  earned and vested but as yet unpaid, salary, prorated Target
                  Bonus, as determined pursuant to Paragraph X.2. or other
                  contingent compensation, reimbursement of business expenses
                  and fringe benefits.

P.       GOVERNING LAW: This Agreement shall be interpreted and enforced in
         accordance with the laws of the State of Employment hereunder.

Q.       ARBITRATION CLAUSE:

         1.       Except for the interpretation and enforcement of injunctive
                  relief pursuant to Paragraph R hereof (which shall be subject
                  to litigation in any court having proper jurisdiction), any
                  claim or dispute related to or arising from this Agreement
                  (whether based in contract or tort, in law or equity)
                  including, but not limited to, claims or disputes between
                  Executive and Company or its directors, officers, employees
                  and agents regarding Executive's employment or termination of
                  employment hereunder, or any other business of Company, shall
                  be resolved by a neutral arbitrator agreed upon by both
                  parties, through mandatory, final, binding arbitration in
                  accordance with the procedural and discovery rules of the
                  American Arbitration Association.

         2.       The cost of such arbitration shall be borne by the Company.
                  Any such arbitration must be requested in writing within one
                  (1) year from the date the party initiating the arbitration
                  knew or should have known about the claim or dispute, or all
                  claims arising from that dispute are forever waived. Any such
                  arbitration (or court proceeding as applicable hereunder)
                  shall be held in the city and/or county of employment
                  hereunder. Judgment upon the award rendered through such
                  arbitration may be entered and enforced in any court having
                  proper jurisdiction.

R.       REMEDIES & DAMAGES:

         1.       The parties agree that, in the event of a material breach or
                  threatened material breach of Paragraphs K and/or L hereof,
                  the damage or imminent damage to the value of Company's
                  business shall be impractical and/or impossible to estimate or
                  ascertain, and therefore any remedy at law or in damages shall
                  be inadequate. Accordingly, the parties hereto agree that
                  Company shall be entitled to the immediate issuance of a
                  restraining order or an injunction against Executive in the
                  event of such breach or threatened breach, in addition to any
                  other relief available to Company pursuant to this Agreement
                  or under law.

         2.       Executive agrees that damages resulting from any such breach
                  which involves any customer of Company shall be the actual
                  damages according to proof, as determined by an arbitrator
                  pursuant to Paragraph Q, above.

         3.       To the full extent permitted under the laws of the State of
                  Employment hereunder, Executive authorizes Company to withhold
                  from any severance payments otherwise due to Executive and
                  from any other funds (other than wages) held for Executive's
                  benefit by Company, any damages or losses sustained by Company
                  as a result of any material breach or other material violation
                  of this Agreement by Executive, pending arbitration between
                  the parties as provided for herein.

S.       NO WAIVER: Failure by either party to enforce any term or condition of
         this Agreement at any time shall not preclude that party from enforcing
         that provision, or any other provision of this Agreement, at any later
         time.

T.       SEVERABILITY: The provisions of this Agreement are severable. If any
         arbitrator (or court as applicable hereunder) rules that any portion of
         this Agreement is invalid or unenforceable, the arbitrator's or court's

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EXHIBIT 10.26                                                      Page 8 of 12

         ruling shall not affect the validity and enforceability of other
         provisions of this Agreement. It is the intent of the parties that if
         any provision of this Agreement is ruled to be overly broad, the
         arbitrator or court shall interpret such provision with as much
         permissible breadth as is allowable under law rather than to consider
         such provision void.

U.       SURVIVAL: All terms and conditions of this Agreement which by
         reasonable implication are meant to survive the termination of this
         Agreement, including but not limited to the Restrictive Covenants and
         Arbitration Clause herein, shall remain in full force and effect after
         the termination of this Agreement.

V.       REPRESENTATIONS: Executive represents and agrees that he or she has
         carefully read and fully understands all of the provisions of this
         Agreement, that he or she is voluntarily entering into this Agreement
         and has been given an opportunity to review all aspects of this
         Agreement with an attorney, if he or she chooses to do so.

W.       NOTICES:

         1.       Any notice required or permitted to be given pursuant to this
                  Agreement shall be in writing and delivered in person, or sent
                  prepaid by certified mail, bonded messenger or overnight
                  express, to the party named at the address set forth below or
                  at such other address as either party may hereafter designate
                  in writing to the other party:

                  EXECUTIVE:        STEVEN M. ZACCAGNINI
                                    26 Mountain Laurel
                                    Dove Canyon, CA 92679

                  COMPANY:          ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA 94111
                                    Attention: Chief Executive Officer

                  COPY:             ABM INDUSTRIES INCORPORATED
                                    160 Pacific Avenue, Suite 222
                                    San Francisco, CA 94111
                                    Attention: Chief Employment Counsel

         2.       Any such Notice shall be assumed to have been received when
                  delivered in person, or forty-eight (48) hours after being
                  sent in the manner specified above.

X.       SPECIAL PROVISIONS:

         1.       BASE SALARY:

                  a.       Three Hundred Nine Thousand Dollars ($309,000) per
                           year effective November 1, 2003 through October 31,
                           2004 at the monthly rate of $25,750.00 payable
                           semi-monthly.

                  b.       Effective November 1, 2004 and at the beginning of
                           each Fiscal Year thereafter, Executive shall be
                           eligible, at the sole discretion of the Company, to
                           receive a merit increase based on Executive's job
                           performance.

                  c.       At the sole discretion of the Board of Directors of
                           the Company (the "Board"), the Company may grant a
                           salary adjustment at any time for reasons deemed
                           appropriate by the Board, including but not limited
                           to a change in Executive's duties resulting in a
                           material increase in responsibility.

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EXHIBIT 10.26                                                      Page 9 of 12

         2.       BONUS: Subject to proration in the event of modification or
                  termination of employment hereunder and further subject to the
                  maximum bonus payable under Subparagraph d, below, Executive
                  shall be paid a bonus ("Bonus") based on the profit ("Profit")
                  for each Fiscal Year, or partial Fiscal Year, of employment
                  hereunder during the Initial Term, and during the Extended
                  Term, if any, of this Agreement, as follows:

                  a.       A discretionary Target Bonus shall be determined by
                           the Company's Board for each Fiscal Year based on
                           profit in accordance with a Bonus Plan which will be
                           provided to Executive annually. Executive's Target
                           Bonus shall be further subject to an Executive
                           Performance Bonus Modifier adjustment of 50% to 150%
                           to determine Executive's Actual Bonus. Such
                           adjustment shall be based on criteria contained in
                           Executive's annual Performance Rating (see copy
                           attached as Exhibit I) as recommended by the
                           person(s) to whom Executive reports and reviewed and
                           approved by the Executive Officer Compensation and
                           Stock Option Committee of the Board and the Board.

                  b.       Profit for purposes of determining such Target Bonus,
                           shall be defined as the consolidated income (in
                           accordance with generally accepted accounting
                           principles) before income taxes of the Company
                           subsidiary(s) for which Executive has management
                           responsibility, excluding: (i) gains or losses on
                           sales or exchanges of real property or on sales or
                           exchanges of all or substantially all of the stock or
                           assets of such subsidiary(s), (ii) gains or losses on
                           the sales of any discontinued business operations,
                           (iii) any corporate charges imposed by the parent
                           Company, and (iv) the total amount of all items of
                           income included in the Company's audited consolidated
                           financial statements for any Fiscal Year that result
                           from the Company's receipt of insurance proceeds or
                           other compensation or damages due to the Company's
                           loss of property, business or profits as a result of
                           the destruction of the World Trade Center on
                           September 11, 2001. At any time the Board reserves
                           the right to further adjust Profit for purposes of
                           determining a Target Bonus in the event of a
                           Significant Transaction (as defined below) during a
                           Fiscal Year and/or for any unanticipated and material
                           events that are beyond the control of the Company,
                           including but not limited to acts of god, nature, war
                           or terrorism, or changes in the rules for financial
                           reporting set forth by the Financial Accounting
                           Standards Board, the Securities and Exchange
                           Commission, and/or the New York Stock Exchange or for
                           any other reason which the Board determines, in good
                           faith, to be appropriate.

                           For purposes of this Agreement, the term "Significant
                           Transaction" shall mean the Company's acquisition or
                           disposition of a business or assets which the Company
                           is required to report under Item 2 of the SEC Form
                           8-K.

                  c.       The Chief Financial Officer of the Company shall
                           calculate the Profit and Target Bonus for purposes of
                           this Agreement. Company shall pay Executive the
                           Actual Bonus for the Fiscal Year, or prorated Target
                           Bonus in the event of modification or termination of
                           employment hereunder, following completion of the
                           audit of the Company's financial statements and
                           approval by the Company's Executive Officer
                           Compensation and Stock Option Committee and the
                           Company's Board of Directors, but no later than
                           seventy-five (75) days after the end of each Fiscal
                           Year. The Company in its sole discretion may pay any
                           Actual Bonus or prorated Target Bonus earlier. The
                           Actual Bonus for any partial Fiscal Year shall be
                           prorated for the fraction of the Fiscal Year for
                           which such Actual Bonus is payable. Absent bad faith
                           or material error, any calculations of the Chief
                           Financial Officer and any conclusions of the Board,
                           with respect to the amounts of the Profit, Target
                           Bonus or Actual Bonus, shall be final and binding
                           upon Executive and Company.

                  d.       Executive's maximum Actual Bonus for each Fiscal Year
                           shall be one hundred percent (100%) of the Base
                           Salary as determined pursuant to this Agreement. In
                           the event of

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EXHIBIT 10.26                                                      Page 10 of 12

                           modification or termination of employment hereunder,
                           Executive's prorated Target Bonus shall not exceed
                           such percent of prorated Base Salary.

                  e.       Notwithstanding the foregoing, no Bonus for any
                           Fiscal Year of the Company shall be payable unless
                           the Company's EPS for the Fiscal Year then ending is
                           equal to or greater than eighty percent (80%) of the
                           Company's EPS for the previous Fiscal Year of the
                           Company, in each case excluding any gains and losses
                           from sales of discontinued operations.

                  f.       Nothing contained in this Agreement shall entitle
                           Executive to receive a bonus or other incentive or
                           contingent compensation from Company based on any
                           sales or profits made by Company after termination of
                           the Initial or Extended Term of this Agreement or of
                           employment hereunder.

                  g.       Notwithstanding any other provision hereof, the Board
                           may, prior to the beginning of any Fiscal Year,
                           approve and notify the Executive of a modification to
                           the Bonus percentage determined hereunder (either
                           higher or lower), based on such performance and
                           financial measures and other factors as the Board
                           shall determine in its sole discretion. The Board's
                           decision in this regard shall be deemed final and
                           binding on Executive regardless of the amount of
                           Target or Actual Bonus otherwise calculated pursuant
                           to the foregoing provisions. In addition, the Board
                           reserves the option at any time to grant a
                           discretionary incentive bonus, which shall not be
                           subject to the maximum Bonus provisions described in
                           paragraph X.2.d above.

Y.       SCOPE OF CERTAIN PROVISIONS: All references to Company in Paragraphs H,
         J, K, L, O.3 and R in this Agreement shall include Company, and its
         subsidiary corporations and other Company affiliates.

Z.       ENTIRE AGREEMENT: Unless otherwise specified herein, this Agreement
         sets forth every contract, understanding and arrangement as to the
         employment relationship between Executive and Company, and may only be
         changed by a written amendment signed by both Executive and Company.

         1.       The parties intend that this Agreement speak for itself, and
                  that no evidence with respect to its terms and conditions
                  other than this Agreement itself may be introduced in any
                  arbitration or judicial proceeding to interpret or enforce
                  this Agreement.

         2.       It is specifically understood and accepted that this Agreement
                  supersedes all oral and written employment agreements between
                  Executive and Company prior to the date hereof, as well as all
                  conflicting provisions of Company's Guidelines for Corporate
                  Approval and its Human Resources Manual, including but not
                  limited to the termination, discipline and discharge
                  provisions contained therein.

         3.       This Agreement may not be amended except in a writing signed
                  by the Executive and Chief Executive Officer and approved by
                  the Company's Board of Directors.

FULL KNOWLEDGE & UNDERSTANDING: Executive and Company hereby acknowledge that
they have carefully read and fully understand all terms and conditions of this
Agreement, that they have been given an opportunity to review all aspects of
this Agreement with an attorney if they so choose, and that they are voluntarily
entering into this Agreement with full knowledge of the benefits and burdens,
and the risks and rewards, contained herein.

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EXHIBIT 10.26                                                      Page 11 of 12

IN WITNESS WHEREOF, Executive and an officer and Director of the Company have
executed this Agreement as of the date set forth above:

            EXECUTIVE:     Signature:       /s/ Steven M. Zaccagnini
                                            ------------------------------------

                           Date:            October 31, 2003

            COMPANY:                        ABM INDUSTRIES INCORPORATED

                           Date:            October 28, 2003

                           Signature:       Donna M. Dell
                                            ------------------------------------

                           Title:           Sr. V.P. of Human Resources

                           Signature:       Henrik C. Slipsager
                                            ------------------------------------

                           Title:           President & CEO

Corp Exec Officer                      INITIALS: EXECUTIVE /s/SMZ COMPANY /s/DMD



EXHIBIT 10.26                                                      Page 12 of 12

                                                                       EXHIBIT I

NAME OF EXECUTIVE:                      Steven M. Zaccagnini

                   2004 EXECUTIVE PERFORMANCE BONUS MODIFIERS
                          RATINGS AND CALCULATION SHEET
                             ABM EXECUTIVE OFFICERS



                                                                  NEEDS              MEETS            EXCEEDS           SUPERIOR
                                         UNSATISFACTORY        IMPROVEMENT       REQUIREMENTS       REQUIREMENTS       PERFORMANCE
                                                                                            
CIRCLE ONE RATING IN EACH CATEGORY

I.   STRATEGIC LEADERSHIP                       1         2         3        4         5        6         7       8         9

II.  FINANCIAL LEADERSHIP                       1         2         3        4         5        6         7       8         9

III. PERFORMANCE AGAINST BUDGET                 1         2         3        4         5        6         7       8         9

IV.  EMPLOYEE LEADERSHIP                        1         2         3        4         5        6         7       8         9
Employee Relations
Staff Development
Recruitment, Retention, Motivation
Teamwork

V. COMPLIANCE & ADMINISTRATION                  1         2         3        4         5        6         7       8         9

TOTAL RATING SCORE:                           [_]

43 - 45 points = 150% of Profit Bonus
40 - 42 points = 140% of Profit Bonus
36 - 39 points = 130% of Profit Bonus
31 - 35 points = 120% of Profit Bonus
28 - 30 points = 110% of Profit Bonus
25 - 27 points = 100% of Profit Bonus
23 - 24 points = 90% of Profit Bonus
21 - 22 points = 80% of Profit Bonus
19 - 20 points = 70% of Profit Bonus
16 - 18 points = 60% of Profit Bonus
>15 points = 50% of Profit Bonus


                                        ________________________________________
                                        Reviewer's Signature

Corp Exec Officer                      INITIALS: EXECUTIVE /s/SMZ COMPANY /s/DMD

EXHIBIT 10.27

                           ABM INDUSTRIES INCORPORATED

                  NON-EMPLOYEE DIRECTOR RETIREMENT BENEFIT AGREEMENT

     THIS AGREEMENT is entered into this ______ day of ____________, ____ by and
between ABM INDUSTRIES INCORPORATED ("ABM") and __________________("Non-Employee
Director"), as follows:

1a.   Early Retirement. At any time during Non-Employee Director's term of
      office, upon or after completing at least five years of service as a
      Non-Employee Director and upon or after attaining the age of sixty-two
      years (but before attaining the age of seventy-two years) Non-Employee
      Director may, but shall not be required to, retire from membership on the
      Board of Directors of ABM ("Board").

1b.   Senior Retirement. At any time during Non-Employee Director's term of
      office, upon or after attaining the age of seventy-two years, Non-Employee
      Director may, but shall not be required to, retire from membership on the
      Board of Directors of ABM ("Board").

2.    Any Non-Employee Director who elects either Early Retirement or Senior
      Retirement shall have the title "Director Emeritus" and shall receive the
      retirement benefits provided below.

3.    Director Emeritus shall be entitled to compensation as follows:

      a.    Upon Early or Senior Retirement, ABM shall pay to Director Emeritus
            the monthly retainer ("Monthly Retainer") received by Non-Employee
            Director prior to retirement, which amount shall be reduced on a
            pro-rata basis for fewer than ten years of service (i.e. eight years
            of prior service as a Non-Employee Director entitles Director
            Emeritus to eighty per cent of the full benefit) and such payments
            shall continue until the earlier of: (i) a period of ten years after
            the Non-Employee Director's retirement or (ii) the death of Director
            Emeritus.

      b.    A Non-Employee Director under age seventy-two who retires with
            fewer than five years service as a Non-Employee Director shall not
            be entitled to any retirement benefit.

4.    Any Director Emeritus, upon or after attaining the age of seventy-two
      years, may elect in writing to receive a lump sum payment of the total or
      balance, as applicable, of the Monthly Retainer on a present value basis
      using an annual discount rate of eight per cent.

5.    Upon invitation by the Board, a Director Emeritus will be welcome to
      attend Board meetings and other Board activities, however a Director
      Emeritus shall not be entitled to payment of any fees or expenses by ABM
      in connection with such attendance.

      NON-EMPLOYEE DIRECTOR               ABM INDUSTRIES INCORPORATED



      ______________________________      BY _______________________________

                                                                               .
                                                                               .
                                                                               .
EXHIBIT 21.1

SUBSIDIARIES OF REGISTRANT
AS OF OCTOBER 31, 2003



                                                                                         Percentage of Voting
                                                                         State of         Securities Owned by
Name                                                                   Incorporation        Immediate Parent
- --------------------------------------------------------------------------------------------------------------
                                                                                   
ABM Industries Incorporated                                            Delaware                 Registrant
(*)     ABM Amtech Incorporated                                        California               100%
        ABM Co. of Boston                                              California               100%
        ABM Engineering Services Company                               California               100%
        ABM Facility Services Company                                  California               100%
        ABM Global Facility Services                                   California               100%
                 International Technology Facility Services, LLC       California                50%
        ABM Industries Charitable Foundation                           California               n/a%
        ABM Janitorial Services - Northern California                  California               100%
        ABM Janitorial Services Co., Ltd.                              Brit. Columbia           100%
        ABM Lakeside, Inc.                                             California               100%
        ABM Mid-Atlantic, Inc.                                         California               100%
        ABM Payroll Service, Inc.                                      California               100%
        ABM Supply Company                                             California               100%
        ABMI Investment Co. ***                                        California               100%
        American Building Maintenance Co.                              California               100%
        American Building Maintenance Co. of Georgia                   California               100%
        American Building Maintenance Co. of Hawaii**                  California               100%
                 Allied Maintenance Services, Inc.                     Hawaii                   100%
        American Building Maintenance Co. of Illinois                  California               100%
        American Building Maintenance Co. of Kentucky                  California               100%
        American Building Maintenance Co. of New York                  California               100%
        American Building Maintenance Co. of New York - Manhattan      California               100%
        American Building Maintenance Co. of Utah**                    California               100%
        American Building Maintenance Co. - West                       California               100%
        American Public Services                                       California               100%
        American Commercial Security Services of New York, Inc.        California               100%
        American Security and Investigative Services, Inc.             California               100%
                 ABMI Security Services, Inc.                          California               100%
                 American Commercial Security Services, Inc.           California               100%
        Ampco - M                                                      California                99%
        Ampco System Parking                                           California               100%
        Amtech Energy Services**                                       California               100%
        Amtech Lighting & Electrical Services                          California               100%
        Amtech Lighting Services                                       California               100%
        Amtech Lighting Services of the Midwest                        California               100%
        Amtech Reliable Elevator Company of Texas**                    Texas                    100%
        Beehive Parking, Inc.**                                        Utah                     100%
        Bonded Maintenance Company                                     Texas                    100%
        Bradford Building Services, Inc.                               California               100%
        Canadian Building Maintenance Company, Ltd.                    Brit. Columbia           100%
                 Supreme Building Maintenance, Ltd.                    Brit. Columbia           100%
        CommAir Mechanical Services                                    California               100%
        Commercial Air Conditioning of Northern California, Inc.       California               100%
        Commercial Property Services, Inc.                             California               100%
        Pansini Oakland Associates ***                                 California                90%
        Servall Services, Inc.                                         Texas                    100%
        System Parking, Inc.                                           California               100%
        Towel and Linen Service, Inc.**                                California               100%


(*)      Subsidiary relationship to registrant or to subsidiary parents shown by
         progressive indentation.

**       Inactive companies

***      A Limited Partnership

EXHIBIT 23.1

                         CONSENT OF INDEPENDENT AUDITORS

To the Board of Directors
ABM Industries Incorporated:

We consent to incorporation by reference in the following Registration
Statements on Form S-8 of ABM Industries Incorporated of our report dated
December 9, 2003, relating to the consolidated balance sheets of ABM Industries
Incorporated and subsidiaries as of October 31, 2003 and 2002, and the related
consolidated statements of income, stockholders' equity and comprehensive
income, and cash flows for each of the years in the three-year period ended
October 31, 2003, and related financial statement Schedule II, which report
appears in the October 31, 2003, annual report on Form 10-K of ABM Industries
Incorporated.



Registration No.  Form                                 Plan
- ----------------  ----            -----------------------------------------------
                            
   333-78423      S-8             "Age-Vested" Career Stock Option Plan
   333-58408      S-8             Employee Stock Purchase Plan
   333-78421      S-8             "Time-Vested" Incentive Stock Option Plan
   333-48857      S-8             Long-Term Senior Executive Stock Option Plan
   333-85390      S-8             2002 Price-Vested Performance Stock Option Plan


/s/  KPMG LLP
- ---------------------------
KPMG LLP

San Francisco, California
January 13, 2004

EXHIBIT 31.1

                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER
                   PERSUANT TO SECURITIES EXCHANGE ACT OF 1934
                           RULE 13a-14(a) OR 15d-14(a)

I, Henrik C. Slipsager, certify that:

1.   I have reviewed this annual report on Form 10-K of ABM Industries
     Incorporated;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material fact or omit to state a material fact necessary to make the
     statements made, in light of the circumstances under which such statements
     were made, not misleading with respect to the period covered by this
     report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this report, fairly present in all material
     respects the financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

     a)  Designed such disclosure controls and procedures, or caused such
         disclosure controls and procedures to be designed under our
         supervision, to ensure that material information relating to the
         registrant, including its consolidated subsidiaries, is made known to
         us by others within those entities, particularly during the period in
         which this report is being prepared;

     b)  Evaluated the effectiveness of the registrant's disclosure controls and
         procedures and presented in this report our conclusions about the
         effectiveness of the disclosure controls and procedures, as of the end
         of the period covered by this report based on such evaluation; and

     c)  Disclosed in this report any change in the registrant's internal
         control over financial reporting that occurred during the registrant's
         most recent fiscal quarter (the registrant's fourth fiscal quarter in
         the case of an annual report) that has materially affected, or is
         reasonably likely to materially affect, the registrant's internal
         control over financial reporting; and

5.   The registrant's other certifying officer and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors (or persons performing the equivalent functions):

     a)  All significant deficiencies and material weaknesses in the design or
         operation of internal control over financial reporting which are
         reasonably likely to adversely affect the registrant's ability to
         record, process, summarize and report financial information; and

     b)  Any fraud, whether or not material, that involves management or other
         employees who have a significant role in the registrant's internal
         control over financial reporting.

January 14, 2004                        /s/ Henrik C. Slipsager
                                        ----------------------------------------
                                        Henrik C. Slipsager
                                        Chief Executive Officer
                                        (Principal Executive Officer)

EXHIBIT 31.2

                    CERTIFICATION OF CHIEF FINANCIAL OFFICER
                   PERSUANT TO SECURITIES EXCHANGE ACT OF 1934
                           RULE 13a-14(a) OR 15d-14(a)

I, George B. Sundby, certify that:

1.   I have reviewed this annual report on Form 10-K of ABM Industries
     Incorporated;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material fact or omit to state a material fact necessary to make the
     statements made, in light of the circumstances under which such statements
     were made, not misleading with respect to the period covered by this
     report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this report, fairly present in all material
     respects the financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

     a)  Designed such disclosure controls and procedures, or caused such
         disclosure controls and procedures to be designed under our
         supervision, to ensure that material information relating to the
         registrant, including its consolidated subsidiaries, is made known to
         us by others within those entities, particularly during the period in
         which this report is being prepared;

     b)  Evaluated the effectiveness of the registrant's disclosure controls and
         procedures and presented in this report our conclusions about the
         effectiveness of the disclosure controls and procedures, as of the end
         of the period covered by this report based on such evaluation; and

     c)  Disclosed in this report any change in the registrant's internal
         control over financial reporting that occurred during the registrant's
         most recent fiscal quarter (the registrant's fourth fiscal quarter in
         the case of an annual report) that has materially affected, or is
         reasonably likely to materially affect, the registrant's internal
         control over financial reporting; and

5.   The registrant's other certifying officer and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors (or persons performing the equivalent functions):

     a)  All significant deficiencies and material weaknesses in the design or
         operation of internal control over financial reporting which are
         reasonably likely to adversely affect the registrant's ability to
         record, process, summarize and report financial information; and

     b)  Any fraud, whether or not material, that involves management or other
         employees who have a significant role in the registrant's internal
         control over financial reporting.

January 14, 2004                        /s/ George B. Sundby
                                        ----------------------------------------
                                        George B. Sundby
                                        Chief Financial Officer
                                        (Principal Financial Officer)

EXHIBIT 32.1

           CERTIFICATIONS PURSUANT TO SECURITIES EXCHANGE ACT OF 1934
                         RULE 13a-14(b) OR 15d-14(b) AND
                            18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

         In connection with the annual report of ABM Industries Incorporated
(the "Company") on Form 10-K for the year ended October 31, 2003, as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), Henrik
C. Slipsager, Chief Executive Officer of the Company, and George B. Sundby,
Chief Financial Officer of the Company, each certifies for the purpose of
complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act
of 1934 (the "Exchange Act") and Section 1350 of Chapter 63 of Title 18 of the
Untied States Code, that:

         (1)      the Report fully complies with the requirements of Section
                  13(a) or 15(d) of the Exchange Act; and

         (2)      the information contained in the Report fairly presents, in
                  all material respects, the financial condition and results of
                  operations of the Company.

January 14, 2004                        /s/ Henrik C. Slipsager
                                        ----------------------------------------
                                        Henrik C. Slipsager
                                        Chief Executive Officer
                                        (Principal Executive Officer)

January 14, 2004                        /s/ George B. Sundby
                                        ----------------------------------------
                                        George B. Sundby
                                        Chief Financial Officer
                                        (Principal Financial Officer)