SAFETY-KLEEN
                              OPERATIONS MANAGEMENT
                                 INCENTIVE PLAN



                                Fiscal Year: 1999





















Rev:  September 30th, 1998




                                       
<PAGE>





                                TABLE OF CONTENTS


                                                                        Page No.

I.      Overview ......................................................... 1

II.     Plan Objectives .................................................. 1

III.    Attaining Goals .................................................. 2

IV.     Eligibility for Plan Participation ............................... 3

V.      Plan Structure ................................................... 3

        A.  Performance Measures and Target Bonuses ...................... 3
               1.  EBITDA ................................................ 3
               2.  Revenue .............................................   4
               3.  Burn Plan ............................................. 4
               4.  Individual Performance ................................ 4

        B.  Performance and Award Criteria ............................... 4
               1.  Target Bonus Levels ................................... 4
               2.  Units of Measure  ..................................... 4
                   Table 1:  Units of Measure and Payout as Percent
                   of Base Pay by Position ............................... 5
               3.  Payout Schedule ....................................... 5
               4.  Bonus Cap ............................................. 5
                  Table 2:   Payout Schedule as Percentage of Target
                  Percent for Annual Goals Achieved Against
                  Committed Targets ...................................... 6

VI.     Payment of Awards ...............................................  7

VII.    Plan Administration .............................................. 7

VIII.   Summary and Conclusion ........................................... 7


                                       
<PAGE>

                                   I. OVERVIEW

The Operations  Management  Incentive Plan (MIP) is a short-term  cash incentive
bonus  plan  covering  operations  executives,   Facility  Managers,  Operations
Managers,  and other  selected  managers.  The plan allows  selected  management
employees to share directly in the success of the Company through the payment of
annual  incentive  awards which are in turn based on the  attainment of business
unit goals and individual performance objectives.

This Plan  Document  provides the Company with a mechanism  to  communicate  its
expectations  for  Company  performance  while at the  same  time  allowing  the
management  team the  opportunity to earn a total  compensation  package that is
competitive for the industry.

In the past, the major components of the MIP have been  facility-based  and have
included such financial  measures as ROA,  EBIT, and revenue.  The remainder has
traditionally been split between a regional, divisional, or Corporate measure
and individual performance.

In the new Company, these facility-based measures will not be adequate since for
fiscal 1999 reliable  facility-based  budgets will not be available in the first
quarter of the year.


                               II. PLAN OBJECTIVES

The  purpose  of a  bonus  compensation  plan  is  to  motivate  key  management
performance  and to reward  those  individuals  considered  responsible  for the
success of the business.  Safety-Kleen  has developed the Operations  Management
Incentive  Plan for key  managerial  personnel  which will provide a significant
economic opportunity based on their contribution to the Corporation and on their
own individual performance.

The following must occur for the Company to be successful:

    o   Waste streams must be kept within the SK structure
    o   Inter-company competition must cease 
    o   Site-by-site parochialism must be eliminated
    o   Business managers must be free to spend more time on finding and working
        on business synergies than detailed budgets

     To accomplish  these  objectives,  a certain  percentage of a key manager's
total compensation  package will be at risk.  Therefore,  plan participants must
direct  their  efforts  and set goals which will  maximize  the success of their
business unit as defined by the Plan.

In  addition  to  the  above,  the  following   environmental  factors  must  be
considered:

    o   Lack of reliability  of budgets by  the  beginning  of  the  fiscal year
    o   Revenue/EBIT  will be  transferred  from  site to site  during  the year
        making budget tracking by site more complicated
    o   Expenses   per  site  will  change  due  to  movement  of  revenues  and
        transportation costs

                                       1
<PAGE>

                              III. ATTAINING GOALS


The success of the  Management  Incentive  Plan will be  measured  by  attaining
preset  goals,  and by showing a significant  level of  commitment  and personal
contribution  to the Company  throughout the year. This can only be accomplished
by the combined support of the Company's management team.

Each  participant  should  understand  that  their  earnings  opportunities  are
dependent  upon the  attainment of these goals.  To enhance this  understanding,
each  participant  will be given an  explanation  of the Plan  along  with their
individual  goals and bonus  potentials.  This will  allow each  participant  to
clearly  understand  that effort that  increases  results  will  produce  higher
rewards.

In implementing and maintaining this Plan, the following factors are of critical
importance:

    o   Measures of achievement  will be quantitative and qualitative in nature.
        The  quantitative  measures of achievement  will be financial goals that
        are tied to the Company's annual financial budget. The use of such goals
        will help generate and  reinforce a commitment to the overall  budgeting
        process.  The  qualitative  measure of achievement  will be based on the
        participant's  level of  commitment  to the  Company  and their  overall
        contribution to the Company's success.

    o   Incentive  awards  will be based  upon  the  achievement  of  aggressive
        objectives.  These aggressive  objectives will help assure that the Plan
        pays  for  itself  out  of  incremental  additional  profits;  and  that
        stockholders   receive  an  appropriate  return  of  investment  in  the
        incentive payments.

    o   The threshold of incentive awards will only be at a "competent" level of
        performance  but  appreciable  more award will result from extra efforts
        and results achieved due to higher levels of performance.


                                       2
<PAGE>

                     IV. ELIGIBILITY FOR PLAN PARTICIPATION

     For fiscal year 1999,  participation in the Operations Management Incentive
Plan will be limited to:

     Executive Staff                                      Operations Managers
     Directors                                            Key Managers
     Facility Managers

A comprehensive list of participants is maintained by Corporate Human Resources.
These  positions  are targeted  because of their direct  accountability  for the
operating  results of a major  business  unit(s)  and their  accountability  for
structuring a function under them.

To receive an annual incentive award,  participants must occupy a bonus eligible
position in the  Management  Incentive Plan as of April 1, 1999, and be employed
by Safety-Kleen at the time incentive awards are paid. Participants who have not
occupied  an  incentive  eligible  position  for the full  fiscal  year  will be
prorated  based on the  number  of full  months  of  participation.  Pre  merger
Safety-Kleen employees who were part of the Safety-Kleen MIP FY1998 Plan and who
are eligible  for the FY1999 Plan will become  eligible for the FY1999 Plan from
1/1/99.  These  eligibility  criteria  apply to current  employees  promoted  to
eligible  positions,  new hires hired into eligible  positions,  or employees in
positions subsequently selected to participate in the Plan.


                                V. PLAN STRUCTURE

A.      PERFORMANCE MEASURES AND TARGET BONUSES

Participants  will be judged against achieving a combination of various criteria
which will be set at the beginning of the year. These are EBITDA,  revenue,  the
burn plan  ("quantitative"),  and individual performance  ("qualitative").  Each
participant should read this document carefully to attain a proper understanding
of the Plan and its dynamics.

1.      EBITDA

EBITDA is  defined  as  earnings  before  depreciation,  amortization,  interest
expense, other income, income taxes and non-sales incentive expense. EBITDA will
be derived from the final monthly  Financial  Results  Report of the fiscal year
after  appropriate  adjustments.  For  FY1999,  the EBITDA goal will be budgeted
EBITDA.

                                       3
<PAGE>


2.      REVENUE

Revenue includes  outside and third-party  revenue only and will be derived from
the final monthly  Financial Results Report of the fiscal year after appropriate
adjustments.  For FY99,  the  revenue  goal will be rolled up  budgeted  accrued
revenue under each participant's direction.

3.      BURN PLAN

Burn plan to be developed and sent to the appropriate participants.

4.      Individual Performance

The Qualitative  Assessment  Summary Sheet (see attachments) is used to identify
specific goals and measures for performance of personal objectives.  The overall
achievement  level  will  determine  the bonus  earned  for  Qualitative  Goals.
Specific  goals are set in five  different  areas:  Health and Safety,  Employee
Turnover,   Environmental  Compliance,   Financial  Improvement,  and  Community
Relations.  Each goal has a weight  and a rating.  The  ratings  earned and goal
weight are combined to determine the appropriate bonus payment percentage.  This
method provides a more objective  measure and a more goals driven means to focus
individual performance.


B.      PERFORMANCE AND AWARD CRITERIA

1.      TARGET BONUS LEVELS

The  target  bonus  payout  is the  monetary  award  that  will  be  paid if all
quantitative  and  qualitative  goals are achieved  exactly as set. This will be
calculated  as a  percentage  of base pay called the target bonus  percent.  For
example,  a participant whose base pay is $50,000 and whose target bonus percent
is 30% will  receive  a  $15,000  award  if all the  performance  goals  are met
exactly. This award can fluctuate if separate goals are missed or exceeded.  The
base pay level used to calculate bonus awards will be the base annualized salary
paid as of August 31, 1999. Target bonus percents can be found in Table 1.

  
2.      UNITS OF MEASURE

The  performance  criteria  for each  plan  participant  should  focus  upon the
appropriate  areas  in  which  the  position  has  opportunity  to  impact.  The
performance  criteria is based upon a  combination  of specific  and  divisional
goals. It should be noted that any unit of measure is not permanently  fixed and
could vary from year to year.



The units of  measure  used and their  associated  contribution  to the  overall
payout are presented in Table 1:

                                      4
<PAGE>

                                     TABLE 1
                          Unit of Measure and Payout as
                          -----------------------------
                         Percent of Base Pay by Position
                         -------------------------------
-------------------------------------------------------------------------
                     Target     Co       Div.     Div.     Burn 
Position             Payout   EBITDA    EBITDA    Rev      Plan    Qual.
=========================================================================
Senior VP             40%       30%      30%      20%              20%
Regional VP           35%                40%      30%              30%
Incineration VP       35%                40%      20%       20%    20%
Staff Dir - Div       20%                40%      30%              30%
Staff Dir - Regional  20%                40%      30%              30%
Facility Manager      30%                40%      30%              30%
Operations Mgr.       15%                40%      30%              30%
Incineration Ops Mgr  15%                40%      20%       20%    20%
Key Manager           15%                40%      30%              30%
Key Staff             10%                40%      30%              30%
------------------------------------------------------------------------

3.      PAYOUT SCHEDULE

The  achievement  level  attained  against  each  goal will  determine  how much
incentive  award  arising  from each goal will be paid.  The schedule in Table 2
presents  the  payout   percentages  for  various   achievement  levels  of  the
quantitative  measures.  The  qualitative  column  represents  the  total  award
available  depending upon the level of  achievement  obtained  against  personal
objectives.  In order to be paid an award for any measure,  the threshold  level
must first be met.

4.      BONUS CAP

Facility  Management  will be paid from a pool of funds  limited to 5% of actual
EBITDA for that facility.  Facility Managers and/or Operations  Managers who are
responsible for more than one facility will be paid from a combined pool.


                                       5
<PAGE>

                                     TABLE 2

                 PAYOUT SCHEDULE AS PERCENTAGE OF TARGET PERCENT
                 -----------------------------------------------
               FOR ANNUAL GOALS ACHIEVED AGAINST COMMITTED TARGETS
               ---------------------------------------------------
-----------------------------------------------------------------------------
                                                 Quantitative/     Potential
Incentive          EBITDA/Revenue/Burn Plan**     Burn  Plan      Qualitative
Step               Achieved Against Committed      Payout           Payout
                            Targets                Levels           Levels
-----------------------------------------------------------------------------
 31                           110% +               135.0%            100%
 30                           109%                 131.5%            100%
 29                           108%                 128.0%            100%
 28                           107%                 124.5%            100%
 27                           106%                 121.0%            100%
 26                           105%                 117.5%            100%
 25                           104%                 114.0%            100%
 24                           103%                 110.5%            100%
 23                           102%                 107.0%            100%
 22                           101%                 103.5%            100%
 21                           100%                 100.0%            100%
 20                            99%                  98.0%            100%
 19                            98%                  96.0%            100%
 18                            97%                  94.0%            100%
 17                            96%                  92.0%            100%
 16                            95%*                 90.0%            100%
 15                            94%                   0.0%            100%
 14                            93%                   0.0%            100%
 13                            92%                   0.0%            100%
 12                            91%                   0.0%            100%
 11                            90%                   0.0%            100%
 10                            89%                   0.0%            100%
  9                            88%                   0.0%            100%
  8                            87%                   0.0%            100%
  7                            86%                   0.0%            100%
  6                            85%                   0.0%            100%
  5                            84%                   0.0%            100%
  4                            83%                   0.0%            100%
  3                            82%                   0.0%            100%
  2                            81%                   0.0%            100%
  1                            80%                   0.0%            100%
  0                            <80%                  0.0%              0%
-----------------------------------------------------------------------------

*   Equivalent of 90% EPS achievement at Corporate level. 
**  EBITDA  achievement  of at  least  80%  is  required  to be  eligible  for a
    qualitative award.



                                      6
<PAGE>


An example of a bonus calculation follows:

        Facility Manager
        Annual Salary:  $50,000
        Target Bonus Percent:  30%
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------
                                                       Unit      Target      Annual        Goal
 Goal                       Achievement   Payout        of       Percent     Salary       Payout
                                                     Measure
<S>                           <C>          <C>           <C>        <C>      <C>         <C>
==================================================================================================
division EBITDA .............   95.6%       90%        x 40%      x 30%    x $50,000   = $ 5,400
Division Revenue ............  101.2%      103.5%      x 30%      x 30%    x $50,000   = $ 4,658
Qualitative Goals ...........  450 Pts.     80%        x 30%      x 30%    x $50,000   = $ 3,600
                            ======================================================================
                               Total:                                                    $13,658
--------------------------------------------------------------------------------------------------
</TABLE>

                              VI. PAYMENT OF AWARDS

Each  incentive  award will be reviewed and approved by the  appropriate  Senior
Vice   President,   the  Chief   Operating   Officer,   the  Vice   President  -
Administration,  and the Chief Executive Officer. Payments will be made no later
than November 15, 1999.  Participants who voluntarily terminate their employment
with  Safety-Kleen  prior to awards  being  issued will  forfeit  their right to
receive any award.

Any adjustment of bonus amounts or any  consideration  of special  circumstances
must be approved by the Vice President - Administration, and the Chief Executive
Officer.


                            VII. PLAN ADMINISTRATION

The Chief Executive Officer of Safety-Kleen  Corporation is the sole interpreter
and
arbitrator of these  provisions  and has the right to amend,  withdraw or revoke
the Plan or any of its provisions at any time.

                          VIII. SUMMARY AND CONCLUSION

The  conceptual  framework and guidelines  covered in this Plan represent  those
elements that necessarily must be examined to assure the value to the Company of
the short-term cash incentive  compensation plan. Several steps must be taken to
ensure  that  those  objectives  which  the  plan is  designed  to  meet  can be
accomplished. These steps are described as follows:


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<PAGE>

        COMMUNICATION OF THE PLAN

It is important that the Plan be effectively  communicated to all  participants.
This  would  include  individual   discussions  with  each  participant.   These
discussions should include a review of the measures and standards that should be
developed to assess  personal  and/or  business unit  performance,  as well as a
clarification of the details of the plan and individual opportunities.


        DEVELOPMENT OF PERFORMANCE MEASURES

Business unit(s) and any individual goals should be established and communicated
at the  beginning  of the fiscal  year.  Accepted  standards  are those that are
reasonable and realistic reflections of current opportunity, as well as striving
for improvement.  Measurements of performance  should use relevant  quantitative
criteria.

                                      8