VICE
PRESIDENT, CHIEF FINANCIAL OFFICER

    


    Effective:
January 1, 2009


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    VICE
PRESIDENT, CHIEF FINANCIAL OFFICER

    


    PURPOSE:  To
define the compensation plan for the Vice President, Chief Financial
Officer.

    


    SCOPE:  Perma-Fix
Environmental Services, Inc.

    


    POLICY:  The
Vice President, Chief Financial Officer Compensation Plan is designed to retain,
motivate and reward the incumbent to support and achieve the business, operating
and financial objectives of Perma-Fix Environmental Services, Inc. (the
“Company”).

    


    BASE
SALARY:  The Base Salary indicated below is paid in equal periodic
installments per the regularly scheduled payroll.

    


    PERFORMANCE
INCENTIVE COMPENSATION: Performance Incentive Compensation is available based on
the Company’s financial results noted in Schedule A.  Performance
Incentive Compensation in the nature of prepayments are payable in the month
following each calendar year quarter in a lump sum.  Annual
performance incentive pay is payable in the month following the close of the
Company’s financial books, but in any event no later than March 15,
2010.  If the financial books are not closed as of March 15, the
annual performance incentive pay will be based on a good faith estimate of the
Company’s financial results for the applicable year.

    


    SEPARATION:  Upon
voluntary or involuntary separation from the Company the employee will be paid
the base salary due to the last day of employment.  If employment is
separated prior to a regularly scheduled quarterly or annual incentive
compensation payment period as noted above, no incentive compensation is due to
the incumbent.

    


    ACKNOWLEDGEMENT:  Payment
of Performance Incentive Compensation of any type will be forfeited, unless the
Human Resources Department has received a signed acknowledgement of receipt of
the Compensation Plan prior to the applicable payment date.

    


    INTERPRETATIONS:  The
Compensation and Stock Option Committee (the “Compensation Committee”) of the
Board of Directors retains the right to modify, change or terminate the
Compensation Plan at any time and for any reason.  It also reserves
the right to determine the final interpretation of any provision contained in
the Compensation Plan and it reserves the right to modify or change the Revenue
and Net Income Targets as defined herein in the event of the sale or disposition
of any of the assets of the Company.  While the plan is intended to
represent all situations and circumstances some issues may not easily be
addressed.  The Compensation Committee will endeavor to review all
standard and non-standard issues related to the Compensation Plan and will
provide quick interpretations that are in the best interest of the Company, its
shareholders and the incumbent.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    VICE
PRESIDENT, CHIEF FINANCIAL OFFICER

    


    Base Pay and Performance
Incentive Compensation Targets

    


    The
compensation for the below named individual as follows:

    


    
      
        
          
            	
                    Annualized
      Base Pay:

                  	 	$	200,000	 
	
                    Performance
      Incentive Compensation Target (at 100% of Plan):

                  	 	 	50,000	 
	
                    Total
      Annual Target Compensation (at 100% of Plan):

                  	 	$	250,000	 


          

        

      

    

    


    The
Performance Incentive Compensation Target is based on the schedule
below.

    


    
      
        
          
            
              
                
                  	
                          Target
      Objectives

                        	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
      	 	 	 	 	
                          Performance
      Target Thresholds

                        	 
	 
      	 	
                          Weights

                        	 	 	
                          100%
      or less

                        	 	 	 	
                          98%-99%

                        	 	 	 	
                          96-97%

                        	 	 	 	
                          94-95%

                        	 	 	 	
                          92-93%

                        	 	 	 	
                          90-91%

                        	 	 	 	
                          88-89%

                        	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                          Administrative
      Expenses

                        	 	 	
                          15

                        	%	 	 	7,500	 	 	 	9,000	 	 	 	9,751	 	 	 	10,531	 	 	 	11,250	 	 	 	12,000	 	 	 	13,125	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
      	 	
                          Weights

                        	 	 	 	85-100	%	 	 	101-120	%	 	 	121-130	%	 	 	131-140	%	 	 	141-150	%	 	 	151-160	%	 	 	161	%+
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                          Net
      Income

                        	 	 	25	%	 	 	12,500	 	 	 	15,000	 	 	 	16,252	 	 	 	17,551	 	 	 	18,749	 	 	 	20,000	 	 	 	21,875	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                          Accounting

                        	 	 	10	%	 	 	5,000	 	 	 	6,000	 	 	 	6,501	 	 	 	7,021	 	 	 	7,500	 	 	 	8,000	 	 	 	8,750	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                          Accounts
      Receivable

                        	 	 	10	%	 	 	5,000	 	 	 	6,000	 	 	 	6,501	 	 	 	7,021	 	 	 	7,500	 	 	 	8,000	 	 	 	8,750	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                          SOX
      Compliance

                        	 	 	10	%	 	 	5,000	 	 	 	6,000	 	 	 	6,501	 	 	 	7,021	 	 	 	7,500	 	 	 	8,000	 	 	 	8,750	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                          Centralization
      & IT Objectives

                        	 	 	30	%	 	 	15,000	 	 	 	18,000	 	 	 	19,503	 	 	 	21,062	 	 	 	22,499	 	 	 	24,000	 	 	 	26,250	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                          Unbilled
      Receivables

                        	 	
                          * If
      criteria (Item #6) for reducing uniblled AR are not met bonus will be
      reduced by 15%.

                        	 	 	 	 	 
	 
      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
      	 	 	 	 	 	 	50,000	 	 	 	60,000	 	 	 	65,009	 	 	 	70,205	 	 	 	74,997	 	 	 	80,000	 	 	 	87,500	 


                

              

            

          

        

      

    

     

    
      	
              1)

            	
              Administrative
      Expense is defined as the total consolidated administrative expenses
      applicable as publicly reported in the Company’s financial
      statements.  Administrative expenses will be inclusive of all
      subsidiaries, and will exclude Marketing Expenses and Interest Expense.
      The Board reserves the right to make adjustments to administrative
      expenses so as not to penalize the employee for material unforeseen events
      outside of the employees responsibility and it reserves the right to
      modify or change the Administrative Expense Targets as defined herein in
      the event of the sale or disposition of any of the assets of the Company
      or in the event of an acquisition.  The Board further reserves
      the right to adjust Administrative Expenses to reflect charges resulting
      from the vesting of incentive stock
  options.

            


    

     

    
      	
              2)

            	
              Net
      Income is defined as the total consolidated bottom line net income
      applicable to Common Stock as publicly reported in the Company’s financial
      statements.  The net income will include all subsidiaries,
      corporate charges, dividends and discounted operations.  The
      percentage achieved is determined by comparing the actual net income to
      the Board approved budgeted net income.  The Board reserves the
      right to make adjustments to net income so as not to penalize the employee
      for actions in the current year which will contribute to net income in
      future years and it reserves the right to modify or change the Net Income
      Targets as defined herein in the event of the sale or disposition of any
      of the assets of the Company or in the event of an
      acquisition.  The Board further reserves the right to adjust net
      income to reflect charges resulting from the vesting of incentive
      stock options.

            


    

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    
      	
              3)

            	
              Accounting
      objective should focus on meeting filing deadlines such as 10K, 10Q, 8K
      and press releases with complete and accurate
  information.

            


    

     

    
      
        
          
            	
                    SEC Filings

                  	 	
                    Performance Target

                  	 
	 
      	 	 	 
	
                    10K
      – filed timely or

                  	 	 	3	%
	 
      	 	 	 	 
	
                    10K
      – extension

                  	 	 	1.5	%
	 
      	 	 	 	 
	
                    1st
      quarter 10Q – filed timely or

                  	 	 	2	%
	 
      	 	 	 	 
	
                    1st
      quarter 10Q – extension

                  	 	 	1	%
	 
      	 	 	 	 
	
                    2nd
      quarter 10Q – filed timely or

                  	 	 	2	%
	 
      	 	 	 	 
	
                    2nd
      quarter 10Q – extension

                  	 	 	1	%
	 
      	 	 	 	 
	
                    3rd
      quarter 10Q – filed timely or

                  	 	 	2	%
	 
      	 	 	 	 
	
                    3rd
      quarter 10Q - extension

                  	 	 	1	%
	 
      	 	 	 	 
	
                    All
      8K’s Filed

                  	 	 	1	%
	 
      	 	 	 	 
	
                    Total
      Achievable

                  	 	 	10	%


          

        

      

    

     

    
      	
              4)

            	
              Accounting
      Receivable objective should focus on achieving certain AR
      targets.

            


    

     

    
      
        
          
            	
                    Accounts Receivable

                  	 	
                    Performance Target

                  	 
	
                    25%
      or less of AR > than 60 days

                  	 	 	5.0	%
	 
      	 	 	 	 
	
                    30%
      or less of AR > than 60 days

                  	 	 	2.5	%
	
                    9%
      or less of AR > than 120 days

                  	 	 	5.0	%
	
                    10%
      or less of AR > than 120 days

                  	 	 	2.5	%
	
                    Total
      Achievable

                  	 	 	10.0	%


          

        

      

    

     

    Accounts
Receivable will be defined as outstanding accounts receivable, per companies AR
sub-ledger, collectable within the control of the financial and operational
staff.

     

    Adjustments
for this figure will include but not be limited to:

     

    
      	
               
      

            	
              1.

            	
              Accounts
      fully reserved when calculating Bad Debt
  Allowance;

            


    

     

    
      	
               
      

            	
              2.

            	
              Accounts
      that are in litigation; and

            


    

     

    
      	
               
      

            	
              3.

            	
              Accounts
      not receivable due to a legitimate operational delay.  Note this
      will only be excluded if invoicing was appropriate despite the operational
      delay.

            


    

     

    
      
        	
                4)

              	
                The
      SOX Incentive target is based maintaining good internal controls and
      minimizing material weaknesses similar to “Permit and License” violations
      on COO and CEO Plan.

              


      

    

     

    
      
        
          	
                  SOX Deficiencies

                	 	
                  
                  

                  Performance Target

                	 
	 
      	 	 	 
	
                  0

                	 	 	10	%
	 
      	 	 	 	 
	
                  1

                	 	 	9	%
	 
      	 	 	 	 
	
                  2

                	 	 	8	%
	 
      	 	 	 	 
	
                  3

                	 	 	5	%
	 
      	 	 	 	 
	
                  4

                	 	 	2	%
	 
      	 	 	 	 
	
                  >
      4

                	 	 	0	%


        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        	
                5)

              	
                Accounting
      Centralization Objective -  
      Completion of the following milestones related to the planned
      centralization of the accounting function to the Corporate office.
      Completion of each objective earns 3% with a maximum target achievable of
      15%.

              


      

       

    

    
      
        
          	
                   

                  Accounting Centralization
      Objectives

                	 	
                  
                  

                  Performance Target

                	 
	 
      	 	 	 
	
                  Continue
      to centralize the accounting function at DSSI, M&EC, PFF, PFFL and
      PFO

                	 	 	3.0	%
	 
      	 	 	 	 
	
                  Payroll
      consolidation is in process and will take affect beginning in January
      2009.

                	 	 	3.0	%
	 
      	 	 	 	 
	
                  We
      will reduce the number of bank accounts effective January 1st
      2009 to one bank account and one lockbox.

                	 	 	3.0	%
	 
      	 	 	 	 
	
                  A
      transition to centralized accounts payable will be implemented in the
      1st
      quarter of 2009. All checks will be
      written and issued from corporate office.

                	 	 	3.0	%
	 
      	 	 	 	 
	
                  A
      P.O. system (that communicates with our Solomon software) will be
      implemented in the first and second quarter
      of 2009.

                	 	 	3.0	%
	 
      	 	 	 	 
	
                  The
      multi-company module of Solomon software will be implemented in first
      quarter of 2009 to simplify accounting
      of many facilities from a centralized location.

                	 	 	3.0	%


        

      

    

    


    IT
Objectives - Completion of the following milestones related to the planned
centralization of the accounting function to the Corporate office. Completion of
each objective earns 3% with a maximum target achievable of 15%.

    


    
      
        
          
            	
                     

                    IT Objectives

                  	 	
                    
                    

                    Performance Target

                  	 
	 
      	 	 	 
	
                    Mixed
      Waste Tracking at PFNW

                  	 	 	3.0	%
	 
      	 	 	 	 
	
                    Accounting
      upgrades

                  	 	 	3.0	%
	 
      	 	 	 	 
	
                    System
      Security

                  	 	 	3.0	%
	 
      	 	 	 	 
	
                    System
      integration plan for the Southeast

                  	 	 	3.0	%
	 
      	 	 	 	 
	
                    IT
      oversight / corporate governance

                  	 	 	3.0	%
	 
      	 	 	 	 
	
                    Tele-Com
      Consolidation

                  	 	 	3.0	%


          

        

      

    

     

    6)      Unbilled
trade receivables is the amount of unbilled reported per 10Q or 10K combining
both the long term and current portion of unbilled.    Unbilled
trade receivable balances older than 12/31/06 should be reduced by $4 million
from $5,109,963 as of 12/31/08 to $1,109,963 by
12/31/09.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Performance Incentive
Compensation Prepayments

    


    Performance
incentive compensation will be prepaid each calendar to be applied against the
annual performance incentive compensation when payable.  This
prepayment will be calculated as follows:

    


    First
Quarter – a prepayment of the performance incentive compensation will be earned
and payable by a comparison of the Board approved budget for the first quarter
to the actual result for the first quarter.  With regard to the
accounting incentives, the total achievable performance target will be adjusted
for the first quarter target when calculating quarterly payment.  For
the AR incentive, the performance target will be calculated by using the total
achievable note updated for the 1st quarter
results. For the SOX incentives the rate used will be the prior year
deficiencies until year-end when the final updated rate will be determined. For
the Centralization and IT Incentives, compensation will be calculated based on
achievement of each individual objective.  The prepayment will be 15%
of the performance incentive compensation which will be earned for the full year
if this percentage achievement of the targets is maintained for the full
year.

    


    Second
Quarter – a prepayment of the performance incentive compensation will be earned
and payable by a comparison of the Board approved budget for the first and
second quarters to the actual result for the first and second
quarters.  With regard to the accounting incentives, the total
achievable performance target will be adjusted for the first quarter target when
calculating quarterly payment.  For the AR incentive, the performance
target will be calculated by using the total achievable note updated for the
1st
quarter results. For the SOX incentives the rate used will be the prior year
deficiencies until year-end when the final updated rate will be
determined.  For the Centralization and IT Incentives, compensation
will be calculated based on achievement of each individual
objective.  The prepayment will be 30% of the performance incentive
compensation which will be earned for the full year if this percentage
achievement of the targets is maintained for the full year less the amount of
the prepayment paid for the first quarter.

    


    Third
Quarter – a prepayment of the performance incentive compensation will be earned
and payable by a comparison of the Board approved budget for the first, second
and third quarters to the actual result for the first, second and third
quarters.  With regard to the accounting incentives, the total
achievable performance target will be adjusted for the first quarter target when
calculating quarterly payment.  For the AR incentive, the performance
target will be calculated by using the total achievable note updated for the
1st
quarter results. For the SOX incentives the rate used will be the prior year
deficiencies until year-end when the final updated rate will be
determined.  For the Centralization and IT Incentives, compensation
will be calculated based on achievement of each individual
objective.  The prepayment will be 45% of the performance incentive
compensation which will be earned for the full year if this percentage
achievement of the targets is maintained for the full year less the amount of
the prepayment paid for the first and second quarters.

    


    If at the
conclusion of any calendar quarter, the performance incentive compensation
prepayment due to an employee is negative as a result of subtracting the
prepayments paid in previous quarters and the amount exceeds $25,000, the
company will recover this overpayment by deducting this amount from payroll paid
in accordance with the company’s normal payroll practices.

    


    ACKNOWLEDGMENT:

    I
acknowledge receipt of the aforementioned Vice President, Chief Financial
Officer 2009 - Compensation Plan.  I have read and understand and
accept employment under the terms and conditions set forth therein.

    


    
      
        	
                /s/Ben
      Naccarato

              	 
      	
                5/6/09

              	 
      
	
                /s/Ben
      Naccarato

              	 
      	
                Date

              	 
      
	 
      	 
      	 
      	 
      
	
                /s/Lou
      Centofanti

              	 
      	
                5/6/09

              	 
      
	
                /s/
      Board of Director

              	 
      	
                Date