LAIDLAW ENVIRONMENTAL SERVICES INC, S-4/A, 1997-11-25

LAIDLAW ENVIRONMENTAL SERVICES INC
S-4/A, 1997-11-25
HAZARDOUS WASTE MANAGEMENT

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 25, 1997

REGISTRATION NO. 333-40185

================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------

AMENDMENT NO. 1

FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------
LAIDLAW ENVIRONMENTAL SERVICES, INC.
(Exact name of Registrant as specified in its charter)
---------------------

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DELAWARE 4953 51-0228924
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization) Classification Code Number) Identification No.)
</TABLE>

1301 GERVAIS STREET, SUITE 300, COLUMBIA, SOUTH CAROLINA 29201, (803) 933-4200
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)

KENNETH W. WINGER
LAIDLAW ENVIRONMENTAL SERVICES, INC.
1301 GERVAIS STREET, SUITE 300,
COLUMBIA, SOUTH CAROLINA 29201,
(803) 933-4200
(Name and address, including zip code, and telephone number, including area
code, of agent for service)

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COPY TO: COPIES TO:
HERBERT S. WANDER, ESQ. ALAN H. PALEY, ESQ.
KATTEN MUCHIN & ZAVIS PAUL S. BIRD, ESQ.
525 WEST MONROE STREET, SUITE 1600 DEBEVOISE & PLIMPTON
CHICAGO, ILLINOIS 60661-3693 875 THIRD AVENUE
(312) 902-5200 NEW YORK, NEW YORK 10022
(219) 909-6000
</TABLE>

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.

If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
---------------------
CALCULATION OF REGISTRATION FEE

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<CAPTION>
==============================================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(1) PER UNIT PRICE(2) REGISTRATION FEE(2)
- ------------------------------------------------------------------------------------------------------------------------------
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Common Stock, $1.00 par value per share
and associated Stock Purchase
Rights(3), of Laidlaw Environmental
Services, Inc......................... 220,008,005 N/A $868,245,877 $263,105
==============================================================================================================================
</TABLE>

(1) Represents the maximum amount of Common Stock, par value $1.00 per share, of
Laidlaw Environmental Services, Inc., a Delaware corporation ("Laidlaw
Environmental") issuable upon the consummation of the exchange offer for
shares of Common Stock, par value $0.10 per share (the "Shares") of
Safety-Kleen Corp., a Wisconsin corporation ("Safety-Kleen"), together with
associated stock purchase rights at the maximum Exchange Ratio (defined
herein) of 3.5. According to Safety-Kleen's Form 10-Q for the period ended
September 6, 1997, as of September 6, 1997, there were issued and
outstanding 58,400,729 Shares of which 601,100 Shares were owned by a
wholly-owned subsidiary of Laidlaw Environmental as of the date of the
filing of this Registration Statement. Based on the foregoing and assuming
that (i) no shares have been issued since September 6, 1997 and (ii) no
options or shares have been issued other than the 5,059,801 options to
purchase shares reported in Safety-Kleen's Form 10-K for the period ended
December 28, 1996, the maximum number of Shares to be received in exchange
would be 62,859,430. The actual number of Shares will depend on the facts
that exist on the date of the exchange.

(2) Pursuant to Rules 457(f)(1) and 457(c) under the Securities Act of 1933, as
amended, and solely for the purposes of calculating the registration fee,
the registration fee was computed on the basis of $28.8125 per Share, the
average of the high and low prices of Safety-Kleen Common Stock as reported
on New York Stock Exchange on November 21, 1997. Pursuant to Rule 457(a) and
(b), the fee has been reduced by $233,938 paid on November 13, 1997 upon the
initial filing under the Securities Act of 1933, as amended, of this
Registration Statement.

(3) Stock Purchase Rights are attached to and trade with Laidlaw Environmental
Common Stock. Value attributable to such rights, if any, is reflected in the
market price of the Laidlaw Environmental Common Stock.
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
================================================================================
<PAGE> 2

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.

SUBJECT TO COMPLETION, DATED NOVEMBER 25, 1997.

PROSPECTUS
OFFER TO EXCHANGE EACH OUTSTANDING
COMMON SHARE
(INCLUDING THE ASSOCIATED SHARE PURCHASE RIGHTS)

SAFETY-KLEEN CORP.
FOR

$15.00 NET PER SHARE IN CASH

(SUBJECT TO ADJUSTMENT AS DESCRIBED BELOW)

AND

$15.00 OF COMMON STOCK

(SUBJECT TO VARIATION AS DESCRIBED BELOW)

LAIDLAW ENVIRONMENTAL SERVICES, INC.

THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON , 1997, UNLESS THE OFFER IS EXTENDED (THE "EXPIRATION
DATE"). SHARES WHICH ARE TENDERED PURSUANT TO THE OFFER MAY BE WITHDRAWN AT ANY
TIME PRIOR TO THE EXPIRATION DATE.

Laidlaw Environmental Services, Inc., a Delaware corporation ("Laidlaw
Environmental"), and LES Acquisition, Inc., a Delaware corporation and indirect
wholly-owned subsidiary of Laidlaw Environmental ("LES Acquisition"), hereby
offer, upon the terms and subject to the conditions set forth herein and in the
related Letter of Transmittal (collectively, the "Offer"), to exchange $15.00
net in cash (subject to adjustment as described below, the "Cash Consideration")
and that number of shares of Common Stock, par value $1.00 per share, of Laidlaw
Environmental ("Laidlaw Environmental Common Stock"), equal to the Exchange
Ratio (as defined below) (the "Stock Consideration" and, together with the Cash
Consideration, the "Offer Consideration"), for each outstanding Common Share,
par value $0.10 per share (each, a "Share" and collectively, the "Shares"), of
Safety-Kleen Corp., a Wisconsin corporation ("Safety-Kleen"), including (unless
and until Laidlaw Environmental and LES Acquisition declare that the Rights
Condition (as defined below) is satisfied) the associated Common Share Purchase
Rights (each, a "Right" and collectively, the "Rights") issued pursuant to the
Rights Agreement, dated as of November 9, 1988, between Safety-Kleen and First
National Bank of Chicago, as Rights Agent, as amended by a First Amendment to
Rights Agreement, dated as of August 10, 1990 and by a Second Amendment to
Rights Agreement, dated as of November 20, 1997 (as so amended, the "Rights
Agreement"), validly tendered on or prior to the Expiration Date and not
properly withdrawn. Unless the context otherwise requires and unless and until
the Rights are redeemed, all references to Shares shall include the associated
Rights. All references herein to Rights shall include all benefits that may
inure to holders of the Rights pursuant to the Rights Agreement.

(Continued on following page)
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THE DEALER MANAGER FOR THE OFFER IS:
BEAR, STEARNS & CO. INC.
245 PARK AVENUE
NEW YORK, NEW YORK 10167
THE DATE OF THIS PROSPECTUS IS , 1997.
<PAGE> 3

(continued from previous page)

"Exchange Ratio" means the quotient (rounded to the nearest 1/100,000)
determined by dividing $15.00 by the weighted average trading prices for Laidlaw
Environmental Common Stock (as reported on the New York Stock Exchange, Inc.
(the "NYSE") Composite Transactions reporting system as published in The Wall
Street Journal or, if not published therein, in another authoritative source)
(the "Laidlaw Environmental Average Price") for ten NYSE trading days (each, a
"Trading Day") selected by lot from the twenty Trading Days ending three
business days immediately prior to the Expiration Date, provided, that the
Exchange Ratio shall not be less than 2.80 nor greater than 3.50. Accordingly,
subject to changes in the actual market value of Laidlaw Environmental Common
Stock on the date that Shares are actually exchanged, each Share will be
exchanged for (in addition to the Cash Consideration) Laidlaw Environmental
Common Stock having a market value of $15.00 if the Laidlaw Environmental
Average Price is between $4.28571 and $5.35714. If the Laidlaw Environmental
Average Price is greater than $5.35714, each Share will be exchanged for (in
addition to the Cash Consideration) Laidlaw Environmental Common Stock having a
market value of more than $15.00, and, conversely, if the Laidlaw Environmental
Average Price is less than $4.28571, each Share will be exchanged for (in
addition to the Cash Consideration) Laidlaw Environmental Common Stock having a
market value of less than $15.00, in each case subject to changes in the actual
market value of Laidlaw Environmental Common Stock on the date that Shares are
actually exchanged. Cash will be paid in lieu of any fractional shares of
Laidlaw Environmental Common Stock. See "The Offer -- The Exchange Ratio."
Laidlaw Environmental Common Stock is listed for trading under the symbol "LLE"
on the NYSE. On , 1997, the closing price of Laidlaw Environmental
Common Stock on the NYSE was $ . Based on such closing price, the
Exchange Ratio would be , and each Share would be converted into $15.00
net in cash (subject to adjustment as described below) and shares of
Laidlaw Environmental Common Stock. The Exchange Ratio will change as the market
price of the Laidlaw Environmental Common Stock changes. Holders of outstanding
Shares ("Safety-Kleen Shareholders") may call (800) - any time on or
after the date hereof through the Expiration Date for the current Exchange Ratio
calculated for purposes of responding to telephone inquiries based on the
average of the closing prices of Laidlaw Environmental Common Stock for the ten
consecutive Trading Days preceding the date the call is placed. The actual
Laidlaw Environmental Average Price and Exchange Ratio will be calculated as of
the third Trading Day immediately prior to the Expiration Date, as described
above, and a press release will be issued announcing the actual Exchange Ratio
prior to the opening of the second Trading Day prior to the Expiration Date (as
it may be extended from time to time).

The Cash Consideration to be paid pursuant to the Offer shall be reduced by
the quotient of (x) the aggregate amount of (i) any termination fees or expenses
paid or reimbursed (or payable or reimbursable) by Safety-Kleen pursuant to the
Agreement and Plan of Merger, dated as of November 20, 1997 (the "Buyout Merger
Agreement"), by and among SK Parent Corp. ("Parent"), SK Acquisition Corp.
("Purchaser") and Safety-Kleen and (ii) any incremental costs, including the
costs of new severance arrangements and other expenses Safety-Kleen may incur in
connection with the Buyout Merger Agreement (such fees, expenses and other
costs, the "Buyout Proposal Expenses") divided by (y) the number of outstanding
Shares (on a fully diluted basis) as of the Expiration Date. On November 24,
1997, Laidlaw Environmental filed a counterclaim in the United States District
Court for the Northern District of Illinois against Safety-Kleen and its board
of directors seeking, among other things, preliminary and permanent injunctive
relief declaring invalid the termination fee and expense reimbursement
provisions of the Buyout Merger Agreement. Laidlaw Environmental is also
submitting a request in writing to Safety-Kleen for a statement setting forth
any incremental costs, including the cost of new severance arrangements and
other expenses that Safety-Kleen has incurred or may reasonably be expected to
incur in connection with the Buyout Merger Agreement. See "Prospectus
Summary -- Litigation."

LAIDLAW ENVIRONMENTAL'S OBLIGATION TO EXCHANGE THE OFFER CONSIDERATION FOR
SHARES PURSUANT TO THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE
SATISFACTION OR, WHERE APPLICABLE, WAIVER OF THE FOLLOWING CONDITIONS: (I) THERE
BEING VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE A NUMBER
OF SHARES WHICH, TOGETHER WITH SHARES

ii
<PAGE> 4

OWNED BY LAIDLAW ENVIRONMENTAL AND ITS AFFILIATES, CONSTITUTE AT LEAST TWO
THIRDS OF THE TOTAL NUMBER OF OUTSTANDING SHARES ON A FULLY DILUTED BASIS (AS
THOUGH ALL OPTIONS OR OTHER SECURITIES CONVERTIBLE INTO OR EXERCISABLE OR
EXCHANGEABLE FOR SHARES (OTHER THAN THE RIGHTS) HAD BEEN SO CONVERTED, EXERCISED
OR EXCHANGED) AS OF THE DATE THE SHARES ARE ACCEPTED FOR EXCHANGE BY LAIDLAW
ENVIRONMENTAL PURSUANT TO THE OFFER (THE "MINIMUM TENDER CONDITION"), (II) THE
AUTHORIZATION TO INCREASE THE NUMBER OF SHARES OF LAIDLAW ENVIRONMENTAL COMMON
STOCK AND THE APPROVAL OF THE ISSUANCE OF SHARES OF LAIDLAW ENVIRONMENTAL COMMON
STOCK IN CONNECTION WITH THE OFFER AND THE MERGER BY HOLDERS OF THE REQUISITE
NUMBER OF SHARES OF LAIDLAW ENVIRONMENTAL COMMON STOCK NECESSARY FOR THE
AUTHORIZATION AND ISSUANCE SHALL HAVE BEEN OBTAINED (THE "LAIDLAW ENVIRONMENTAL
STOCKHOLDER APPROVAL CONDITION"), (III) THE SAFETY-KLEEN BOARD HAVING REDEEMED
THE RIGHTS OR AMENDED THE RIGHTS AGREEMENT SO THAT THE RIGHTS ARE INAPPLICABLE
TO THE ACQUISITION OF SHARES PURSUANT TO THE OFFER, OR LAIDLAW ENVIRONMENTAL
BEING OTHERWISE SATISFIED IN ITS SOLE DISCRETION THAT THE RIGHTS ARE INVALID OR
ARE NOT APPLICABLE TO THE ACQUISITION OF SHARES PURSUANT TO THE OFFER AND THE
PROPOSED MERGER (THE "RIGHTS PLAN CONDITION"), (IV) LAIDLAW ENVIRONMENTAL BEING
SATISFIED, IN ITS SOLE DISCRETION, EITHER THAT THE PROVISIONS OF SECTION
180.1141 AND SECTION 180.1150 OF THE WISCONSIN STATUTES (THE "WISCONSIN
STATUTES") ARE INAPPLICABLE TO LAIDLAW ENVIRONMENTAL, LES ACQUISITION AND THE
TRANSACTIONS CONTEMPLATED HEREIN, OR THAT (A) FULL VOTING RIGHTS FOR ALL SHARES
TO BE ACQUIRED BY LAIDLAW ENVIRONMENTAL AND LES ACQUISITION PURSUANT TO THE
OFFER HAVE BEEN RESTORED BY THE SHAREHOLDERS OF SAFETY-KLEEN PURSUANT TO THE
WISCONSIN STATUTES, AND (B) THE WISCONSIN STATUTES WILL NOT PROHIBIT FOR ANY
PERIOD OF TIME THE CONSUMMATION OF THE MERGER OR ANY OTHER "BUSINESS
COMBINATION" (AS DEFINED IN SUCH STATUTES) INVOLVING SAFETY-KLEEN AND LAIDLAW
ENVIRONMENTAL OR LES ACQUISITION, OR ANY OF THEIR RESPECTIVE AFFILIATES (THE
"WISCONSIN STATUTORY CONDITION"), (V) ALL REGULATORY APPROVALS REQUIRED TO
CONSUMMATE THE OFFER HAVING BEEN OBTAINED AND REMAINING IN FULL FORCE AND
EFFECT, ALL STATUTORY WAITING PERIODS IN RESPECT THEREOF HAVING EXPIRED AND NO
SUCH APPROVAL CONTAINING ANY CONDITIONS OR RESTRICTIONS WHICH THE LAIDLAW
ENVIRONMENTAL BOARD OF DIRECTORS (THE "LAIDLAW ENVIRONMENTAL BOARD") DETERMINES
WILL OR COULD BE EXPECTED TO MATERIALLY IMPAIR THE STRATEGIC AND FINANCIAL
BENEFITS EXPECTED TO RESULT FROM THE OFFER (THE "REGULATORY APPROVAL
CONDITION")AND (VI) A FINAL JUDICIAL DETERMINATION EITHER (A) TO THE EFFECT THAT
SAFETY-KLEEN IS NOT OBLIGATED TO, AND MAY NOT, PAY THE BUYOUT PROPOSAL EXPENSES
OR (B) STATING THE AMOUNT OF BUYOUT PROPOSAL EXPENSES THAT ARE REQUIRED TO BE
PAID BY SAFETY-KLEEN SHALL HAVE BEEN OBTAINED (THE "BUYOUT EXPENSE CONDITION").
THE MINIMUM TENDER CONDITION, THE LAIDLAW ENVIRONMENTAL STOCKHOLDER APPROVAL
CONDITION, THE RIGHTS PLAN CONDITION, THE WISCONSIN STATUTORY CONDITION, THE
REGULATORY APPROVAL CONDITION, THE BUYOUT EXPENSE CONDITION AND THE OTHER
CONDITIONS SET FORTH UNDER THE CAPTION "THE OFFER -- CONDITIONS OF THE
OFFER -- CERTAIN OTHER CONDITIONS OF THE OFFER" SHALL BE REFERRED TO
COLLECTIVELY AS THE "OFFER CONDITIONS." TERMS USED BUT NOT DEFINED ABOVE ARE
DEFINED HEREINAFTER.

THIS PROSPECTUS AND THE OFFER MADE HEREBY DO NOT CONSTITUTE A SOLICITATION
OF ANY PROXIES. ANY SUCH SOLICITATION WILL BE MADE ONLY PURSUANT TO SEPARATE
PROXY MATERIALS COMPLYING WITH THE REQUIREMENTS OF SECTION

iii
<PAGE> 5

14(A) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT").

THIS PROSPECTUS CONTAINS CERTAIN ANALYSES AND STATEMENTS WITH RESPECT TO
THE FINANCIAL CONDITION, RESULTS OF OPERATIONS AND BUSINESS OF LAIDLAW
ENVIRONMENTAL FOLLOWING THE CONSUMMATION OF THE OFFER AND THE MERGER, INCLUDING
STATEMENTS RELATING TO THE COST SAVINGS OR SYNERGIES THAT MAY BE REALIZED FROM
THE MERGER. SEE "PROSPECTUS SUMMARY -- REASONS FOR THE OFFER -- ENHANCED
BUSINESS OPPORTUNITIES" AND "BACKGROUND OF OFFER." THESE ANALYSES AND STATEMENTS
INCLUDE FORWARD-LOOKING STATEMENTS WITH RESPECT TO, AMONG OTHER THINGS, EXPECTED
COST SAVINGS FROM THE MERGER, FUTURE BUSINESS DECISIONS, AND OTHER UNCERTAINTIES
WHICH, ALTHOUGH CONSIDERED REASONABLE BY LAIDLAW ENVIRONMENTAL, ARE SUBJECT TO
UNCERTAINTIES AND INVOLVE MATTERS THAT ARE BEYOND LAIDLAW ENVIRONMENTAL'S
CONTROL AND DIFFICULT TO PREDICT. SEE "SUMMARY -- CAUTIONARY STATEMENT REGARDING
FORWARD-LOOKING STATEMENTS." FURTHER INFORMATION AND OTHER FACTORS WHICH COULD
AFFECT THE FINANCIAL RESULTS OF LAIDLAW ENVIRONMENTAL AFTER THE MERGER ARE
INCLUDED IN THE FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION INCORPORATED
BY REFERENCE HEREIN.

---------------------

Laidlaw Environmental is unable to predict the amount of time necessary to
obtain, among other things, the shareholder, governmental and regulatory
approvals and consents required to complete the Offer and the transactions
contemplated herein. However, the time necessary to obtain such approvals and
consents may extend beyond the Expiration Date, and Laidlaw Environmental
reserves the right to extend the Offer from time to time in its sole discretion.

---------------------

IMPORTANT

Any Safety-Kleen Shareholder desiring to tender all or any portion of his
or her Shares and the associated Rights should either (a) complete and sign the
Letter of Transmittal or a facsimile copy thereof in accordance with the
instructions in the Letter of Transmittal, and mail or deliver the Letter of
Transmittal or such facsimile and any other required documents to IBJ Schroder
Bank & Trust Company (the "Exchange Agent") and either deliver the certificates
for such Shares and, if separate, certificates for the Rights to the Exchange
Agent along with the Letter of Transmittal, deliver such Shares (and Rights, if
applicable) pursuant to the procedures for book-entry transfer set forth herein
(in the case of Rights, only if such procedures are available) or comply with
the guaranteed delivery procedures set forth below or (b) request his or her
broker, dealer, commercial bank, trust company or other nominee to effect the
transaction for such Safety-Kleen Shareholder. Any Safety-Kleen Shareholder
having Shares and, if applicable, Rights registered in the name of a broker,
dealer, commercial bank, trust company or other nominee is urged to contact such
broker, dealer, commercial bank, trust company or other nominee if he or she
desires to tender such Shares and, if applicable, Rights.

Safety-Kleen Shareholders will be required to tender one Right for each
Share tendered in order to effect a valid tender of Shares, unless and until
Laidlaw Environmental declares that the Rights Plan Condition is satisfied or
waived. Unless and until the Safety-Kleen Distribution Date (as defined herein)
occurs, a tender of Shares will constitute a tender of the associated Rights.

A Safety-Kleen Shareholder that desires to tender Shares and, if
applicable, Rights and whose certificates for such Shares and, if applicable,
Rights are not immediately available or who cannot comply with the procedures
for book-entry transfer on a timely basis or who cannot deliver all required
documents to the Exchange Agent prior to the Expiration Date, may tender such
Shares and, if applicable, Rights, by following the procedure for guaranteed
delivery.

iv
<PAGE> 6

Questions and requests for assistance may be directed to the Information
Agent or to the Dealer Manager at their respective addresses and telephone
numbers set forth on the back cover of this Prospectus. Requests for additional
copies of this Prospectus and the Letter of Transmittal may be directed to the
Information Agent or to brokers, dealers, commercial banks or trust companies.

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION IN CONNECTION WITH THE OFFER OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY LAIDLAW ENVIRONMENTAL OR BEAR, STEARNS & CO. INC. (THE "DEALER MANAGER").
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR A SOLICITATION TO ANY PERSON IN
ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. THE OFFER IS
NOT BEING MADE TO, NOR WILL TENDERS BE ACCEPTED FROM OR ON BEHALF OF,
SAFETY-KLEEN SHAREHOLDERS IN ANY JURISDICTION IN WHICH THE MAKING OR ACCEPTANCE
THEREOF WOULD NOT BE IN COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION. HOWEVER,
LAIDLAW ENVIRONMENTAL MAY, IN ITS SOLE DISCRETION, TAKE SUCH ACTION AS IT MAY
DEEM NECESSARY TO MAKE THE OFFER IN ANY SUCH JURISDICTION AND EXTEND THE OFFER
TO SAFETY-KLEEN SHAREHOLDERS IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY EXCHANGE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF LAIDLAW
ENVIRONMENTAL OR SAFETY-KLEEN SINCE THE DATE AS OF WHICH INFORMATION IS
FURNISHED OR THE DATE HEREOF.

IN ANY JURISDICTION WHERE THE SECURITIES, BLUE SKY OR OTHER LAWS REQUIRE
THE OFFER TO BE MADE BY A LICENSED BROKER OR DEALER, THE OFFER SHALL BE DEEMED
TO BE MADE ON BEHALF OF LAIDLAW ENVIRONMENTAL BY BEAR, STEARNS & CO. INC. AS
DEALER MANAGER, OR ONE OR MORE REGISTERED BROKERS OR DEALERS LICENSED UNDER THE
LAWS OF SUCH JURISDICTION.

v
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TABLE OF CONTENTS

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PAGE
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AVAILABLE INFORMATION....................................... vi
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE............. vii
SAFETY-KLEEN INFORMATION.................................... viii
PROSPECTUS SUMMARY.......................................... 1
REASONS FOR THE OFFER....................................... 17
BACKGROUND OF THE OFFER..................................... 18
THE OFFER................................................... 27
THE MERGER.................................................. 47
INFORMATION REGARDING SAFETY-KLEEN.......................... 48
INFORMATION REGARDING LAIDLAW ENVIRONMENTAL................. 48
UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION.......... 55
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL
INFORMATION............................................... 57
DESCRIPTION OF LAIDLAW ENVIRONMENTAL CAPITAL STOCK.......... 61
COMPARISON OF THE RIGHTS OF HOLDERS OF SHARES AND LAIDLAW
ENVIRONMENTAL COMMON STOCK................................ 62
COMPARISONS OF DELAWARE AND WISCONSIN LAW -- SIMILARITIES... 62
COMPARISON OF DELAWARE AND WISCONSIN LAW -- DIFFERENCES..... 64
MARKET PRICES............................................... 69
VALIDITY OF LAIDLAW ENVIRONMENTAL COMMON STOCK.............. 70
EXPERTS..................................................... 70
SCHEDULE A -- DIRECTORS AND EXECUTIVE OFFICERS OF LAIDLAW
ENVIRONMENTAL............................................. A-1
SCHEDULE B -- OWNERSHIP OF SHARES BY CERTAIN BENEFICIAL
OWNERS AND SAFETY-KLEEN MANAGEMENT........................ B-1
</TABLE>

AVAILABLE INFORMATION

Laidlaw Environmental and Safety-Kleen are subject to the informational
requirements of the Exchange Act, and in accordance therewith file reports,
proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). Reports, proxy statements and other information
filed by Laidlaw Environmental and Safety-Kleen with the Commission may be
inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549 and at the public reference facilities in the Commission's Regional
Offices at Seven World Trade Center, 13th Floor, New York, New York 10048 and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of information may be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed
rates. Because Laidlaw Environmental and Safety-Kleen each file certain
documents electronically with the Commission, reports, proxy and information
statements and other information regarding Laidlaw Environmental and
Safety-Kleen may also be accessed through the Commission's Web site,
http//:www.sec.gov. Laidlaw Environmental Common Stock and the Shares are listed
and traded on the NYSE, and Laidlaw Environmental Common Stock is also traded on
the Pacific Exchange, Inc. Reports, proxy statements and other information filed
by Laidlaw Environmental and Safety-Kleen with the Commission may be inspected
at the offices of the NYSE, 20 Broad Street, New York, New York 10005, and in
the case of Laidlaw Environmental, at the offices of the Pacific Exchange at 301
Pine Street, San Francisco, California 94104.

vi
<PAGE> 8

This Prospectus does not contain all of the information set forth in the
Registration Statement on Form S-4 (together with all amendments and exhibits
thereto, the "Registration Statement"), covering the Laidlaw Environmental
Common Stock offered hereby, which has been filed with the Commission, certain
portions of which have been omitted pursuant to the rules and regulations of the
Commission, and to which portions reference is hereby made for further
information with respect to Laidlaw Environmental and Safety-Kleen and the
securities offered hereby. Statements contained herein concerning the provisions
of certain documents are not necessarily complete and, in each instance,
reference is made to the copies of such documents filed as exhibits to the
Registration Statement or otherwise filed with the Commission, for a more
complete description of the matter involved. Each such statement is qualified in
its entirety by such reference.

Not later than the date of commencement of the Offer, Laidlaw Environmental
and LES Acquisition will file with the Commission a statement on Schedule 14D-1
pursuant to Rule 14d-3 under the Exchange Act furnishing certain information
with respect to the Offer. Such Schedule and any amendments thereto should be
available for inspection and copying as set forth above (except that such
Schedules and any amendments thereto will not be available at the regional
offices of the Commission).

Pursuant to Rule 409 promulgated under the Securities Act and Rule 12b-21
promulgated under the Exchange Act, Laidlaw Environmental will request that
Safety-Kleen and its independent public accountants, Arthur Andersen LLP,
provide to Laidlaw Environmental the information required for complete
disclosure concerning the business, operations, financial condition and
management of Safety-Kleen. Laidlaw Environmental will provide any and all
information that it receives from Safety-Kleen or Arthur Andersen LLP prior to
the expiration of the Offer and that Laidlaw Environmental deems material,
reliable and appropriate in a subsequently prepared amendment or supplement
hereto.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

THIS PROSPECTUS INCORPORATES BY REFERENCE DOCUMENTS NOT PRESENTED HEREIN OR
DELIVERED HEREWITH. THESE DOCUMENTS (NOT INCLUDING EXHIBITS TO SUCH DOCUMENTS
THAT ARE NOT SPECIFICALLY INCORPORATED BY REFERENCE INTO SUCH DOCUMENTS) ARE
AVAILABLE WITHOUT CHARGE UPON REQUEST TO: CORPORATE SECRETARY, LAIDLAW
ENVIRONMENTAL SERVICES, INC., 1301 GERVAIS STREET, SUITE 300, COLUMBIA, SOUTH
CAROLINA 29201. TELEPHONE REQUESTS MAY BE DIRECTED TO THE CORPORATE SECRETARY'S
DEPARTMENT AT (803) 933-4200. IN ORDER TO ENSURE TIMELY DELIVERY OF SUCH
DOCUMENTS, ANY REQUEST FOR DOCUMENTS SHOULD BE SUBMITTED NOT LATER THAN FIVE
BUSINESS DAYS PRIOR TO THE EXPIRATION DATE.

The following documents filed with the Commission by Laidlaw Environmental
(File No. 1-8368) are incorporated herein by reference:

(a) Laidlaw Environmental Form 10-K for the fiscal year ended August
31, 1997 (the "Laidlaw Environmental 1997 Form 10-K");

(b) Laidlaw Environmental Proxy Statement, dated October 28, 1997, for
Laidlaw Environmental's annual meeting to be held on November 25, 1997 (the
"Laidlaw Environmental 1997 Annual Meeting Proxy Statement"); and

(c) Laidlaw Environmental Current Report on Form 8-K, dated November
5, 1997, two Current Reports on Form 8-K, dated November 14, 1997, a
Current Report on Form 8-K, dated November 19, 1997 and a Current Report on
Form 8-K, dated November 21, 1997 (the "Laidlaw Environmental Form 8-Ks").

The following documents filed with the Commission by Safety-Kleen (File No.
1-6513) are incorporated herein by reference:

(a) Safety-Kleen Form 10-K for the fiscal year ended December 28, 1996
(the "Safety-Kleen 1996 Form 10-K") (except for the report of
Safety-Kleen's independent auditors contained therein which is

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not incorporated herein by reference because the consent of Safety-Kleen's
independent auditors has not yet been obtained);

(b) Safety-Kleen Forms 10-Q for the quarterly periods ending March 22,
June 14 and September 6, 1997 (the "Safety-Kleen Form 10-Qs");

(c) Safety-Kleen Proxy Statement, dated March 28, 1997, for the
Safety-Kleen annual meeting held May 9, 1997 (the "Safety-Kleen Annual
Meeting Proxy Statement"); and

(d) Safety-Kleen Current Reports on Form 8-K, dated August 8, 1997,
November 18, 1997 and November 21, 1997 (the "Safety-Kleen Form 8-Ks").

All documents filed by either Laidlaw Environmental or Safety-Kleen
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to
the date hereof and prior to the date the Offer is terminated or the Shares are
accepted for exchange shall be deemed to be incorporated herein by reference and
to be a part hereof from the date of such filing. See "Available Information."
Any statement contained herein or in a document incorporated or deemed to be
incorporated herein by reference shall be deemed to be modified or superseded
for purposes hereof to the extent that a statement contained herein or in any
other subsequently filed document which also is, or is deemed to be,
incorporated herein by reference modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed to constitute a part
hereof, except as so modified or superseded.

SAFETY-KLEEN INFORMATION

While Laidlaw Environmental has included information concerning
Safety-Kleen insofar as it is known or reasonably available to Laidlaw
Environmental, Safety-Kleen is not affiliated with Laidlaw Environmental and
Safety-Kleen has not to date permitted access by Laidlaw Environmental to
Safety-Kleen's books and records for the purpose of preparing this Prospectus.
Therefore, information concerning Safety-Kleen that has not been made public was
not available to Laidlaw Environmental for the purpose of preparing this
Prospectus. Although Laidlaw Environmental has no knowledge that would indicate
that statements relating to Safety-Kleen contained or incorporated by reference
in this Prospectus in reliance upon publicly available information are
inaccurate or incomplete, Laidlaw Environmental was not involved in the
preparation of such information and statements and, for the foregoing reasons,
is not in a position to verify any such information or statements.

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<PAGE> 10

PROSPECTUS SUMMARY

The information below is qualified in its entirety by the more detailed
information and financial statements appearing elsewhere in this Prospectus,
including the documents incorporated in this Prospectus by reference.
Safety-Kleen Shareholders are urged to read this Prospectus and the attachments
hereto, and the documents incorporated herein by reference, in their entirety.
As used in this Prospectus, the terms "Laidlaw Environmental" and "Safety-Kleen"
refer to such entities and, unless the context otherwise requires, their
subsidiaries. Unless otherwise indicated, all information set forth in this
Prospectus assumes (i) that the Buyout Proposal Expenses are not paid and do not
result in a reduction in the Cash Consideration paid to the Safety-Kleen
Stockholders and (ii) that the Laidlaw Environmental Average Price is equal to
or greater than $4.28571 and less than or equal to $5.35714.

LAIDLAW ENVIRONMENTAL BUSINESS

Laidlaw Environmental provides hazardous and industrial waste management
services throughout North America. Laidlaw Environmental collects, transports,
treats and disposes of waste by incineration, landfilling and other methods at
its facilities located in the United States and Canada. Laidlaw Environmental
also operates waste processing, recycling and repackaging facilities and has
analytical laboratories at its facilities in several states.

On May 15, 1997, pursuant to a February 6, 1997 stock purchase agreement
(the "Stock Purchase Agreement") between Rollins Environmental Services, Inc.
("Rollins") and Laidlaw Inc. ("Laidlaw"), Rollins acquired the hazardous and
industrial waste operations of Laidlaw ("Old LESI") (the "Acquisition"). The
Acquisition was accounted for as a reverse acquisition using the purchase method
of accounting. Rollins issued 120 million common shares and a $350 million 5%
subordinated convertible pay-in-kind debenture, and paid $349.1 million in cash
($400 million, less assumed debt of $50.9 million), to Laidlaw to consummate the
Acquisition. Concurrent with the closing of the Acquisition, the continuing
legal entity changed its name from Rollins Environmental Services, Inc. to
Laidlaw Environmental Services, Inc. As a result of the Acquisition, Laidlaw
owns approximately 67% of the issued common shares of Laidlaw Environmental.
Laidlaw Environmental accordingly adopted Old LESI's fiscal year-end of August
31.

Old LESI consisted of all direct and indirect subsidiaries of Laidlaw
engaged in the hazardous and industrial waste business, other than JTM
Industries, Inc. and its subsidiary, KBK Enterprises, Inc. Prior to the
Acquisition, Old LESI provided hazardous and industrial waste services from 85
service locations in 26 states and seven Canadian provinces. Although Old LESI
was a conglomerate of separate entities, these entities conducted such services
primarily under the name "Laidlaw Environmental Services."

Laidlaw Environmental, in providing hazardous and industrial waste
services, is engaged in five primary lines, or classes, of business: (a) service
center; (b) landfill; (c) incineration; (d) transportation; and (e) specialty
services, including polychlorinated biphenyl ("PCB") management, wastewater
treatment and other specialty services.

Laidlaw Environmental's revenues and income are derived from one industry
segment principally in the United States, which includes the collection,
transportation, processing/recovery and disposal of hazardous and industrial
wastes. This segment renders services to a variety of commercial, industrial,
governmental and residential customers. Substantially all revenues represent
income from unaffiliated customers.

Laidlaw Environmental was incorporated in Delaware in 1968. Its principal
executive office is located at 1301 Gervais Street, Suite 300, Columbia, South
Carolina 29201 and its telephone number is (803) 933-4200.

LES Acquisition is a newly formed Delaware corporation, indirectly wholly
owned by Laidlaw Environmental. LES Acquisition has no operations other than in
connection with Laidlaw Environmental's efforts to acquire Safety-Kleen.

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<PAGE> 11

SAFETY-KLEEN BUSINESS

The following information concerning Safety-Kleen is excerpted from the
Safety-Kleen 1996 Form 10-K and other publicly available information.

Safety-Kleen was incorporated in July 1963 under the laws of the State of
Wisconsin. Safety-Kleen's principal executive office is located at 1 Brinckman
Way, Elgin, Illinois 60123, and its telephone number is (847) 697-8460.

Safety-Kleen groups its operations geographically into North America and
Europe. Safety-Kleen further segregates its North American services into four
broad categories: industrial services; automotive/retail repair services; oil
recovery services; and other services. Safety-Kleen performed nearly 5 million
individual services and reclaimed more than 300 million gallons of contaminated
fluid through a network of 230 branches worldwide in 1996. The Company collects
and recycles used products at thirteen recycling centers, two lube oil
refineries, and three fuel blending facilities.

Safety-Kleen operates in the continental United States, Canada, the United
Kingdom, the Republic of Ireland, Puerto Rico, Belgium, France, Italy, Spain and
Germany. Safety-Kleen has licensee operations in Japan and Korea.

On August 8, 1997 Safety-Kleen announced the resignation of John G.
Johnson, Jr., President and Chief Executive Officer of Safety-Kleen. Donald W.
Brinckman, Chairman of Safety-Kleen's Board of Directors, who had previously
served as Safety-Kleen's Chief Executive Officer from 1968 until December 31,
1994, was appointed Chief Executive Officer. Safety-Kleen also announced that
its Board of Directors had engaged the services of William Blair & Company
("William Blair") to act as advisor to Safety-Kleen and manage the process of
exploring strategic options for enhancing shareholder value.

On November 20, 1997, Safety-Kleen announced that it had entered into the
Buyout Merger Agreement with Parent and Purchaser, two newly-formed affiliates
of Philip Services Corp. ("Philip Services"), Apollo Advisors, L.P. ("Apollo")
and Blackstone Management Associates III, L.P. ("Blackstone" and, together with
Philip Services and Apollo, the "Buyout Group"), pursuant to which Purchaser
will merge with and into Safety-Kleen in a transaction in which Safety-Kleen
Shareholders will receive $27 per Share in cash (the "Buyout Proposal"). The
closing of the Buyout Proposal is subject to certain conditions, including the
approval of Safety-Kleen's Shareholders and both the debt and equity funding of
the financing arrangements of the Buyout Group. See "Background of The Offer
-- The Buyout Proposal."

REASONS FOR THE OFFER

Offer Premium. The purpose of the Offer is for Laidlaw Environmental to
obtain control of, and ultimately the entire equity interest in, Safety-Kleen.
Laidlaw Environmental presently intends, as soon as practicable after
consummation of the Offer, to propose and seek to have Safety-Kleen effect a
merger (the "Merger") of LES Acquisition with and into Safety-Kleen pursuant to
the provisions of the Wisconsin Statutes and the Delaware General Corporation
Law (the "DGCL"). The consideration per Share in the Merger would be identical
to the Offer Consideration. Safety-Kleen has not provided Laidlaw Environmental
with information that might be relevant to the structuring of the Merger.
Laidlaw Environmental therefore reserves the right to change the structure of
the Merger upon receipt of such information.

Laidlaw Environmental believes that the Offer is in the best interests of
the Safety-Kleen Shareholders because, among other things, the Offer
Consideration represents a 68.4% premium to the per Share closing price on the
NYSE on August 7, 1997, the day before Safety-Kleen announced the retention of
William Blair, a 36.8% premium to the per Share closing price on the NYSE on
November 3, 1997, the last trading day prior to the public announcement of
Laidlaw Environmental's intention to make the Offer, and an 11.1% premium to the
$27.00 per Share merger consideration in the Buyout Proposal. See "Reasons for
the Offer -- Offer Premium." In developing its belief that the Offer is in the
best interests of Safety-Kleen Shareholders, Laidlaw Environmental possessed
limited information with respect to the particular circumstances, from a tax
standpoint, of individual Safety-Kleen Shareholders. Laidlaw Environmental
therefore cannot make a conclusive determination as to the tax impact of the
Offer and the Merger on all Safety-Kleen Shareholders.

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<PAGE> 12

Enhanced Business Opportunities. In addition to the significant premium
being offered per Share, Laidlaw Environmental believes that Safety-Kleen
Shareholders will benefit in several ways as a result of becoming shareholders
of Laidlaw Environmental. Upon consummation of the Offer, Laidlaw Environmental
intends to build upon Safety-Kleen's leading market presence and quality brand
equity. In addition, Laidlaw Environmental's management believes that annual
cost savings of approximately $100 to $130 million would result from the
combination of the two companies due to an anticipated elimination of
duplicative general and administrative and other public company costs, the
closure of overlapping service center facilities, the increased utilization of
those facilities that remain open, and the internalization of various waste
streams. Laidlaw Environmental believes that its acquisition of Safety-Kleen
will result in a further strengthening of Laidlaw Environmental's market
position by: (i) providing additional service center market coverage in key
geographic regions including Kentucky, Minnesota, and New Jersey; (ii)
introducing a smaller-sized customer base to complement Laidlaw Environmental's
existing customer base of medium- and large-sized customers; (iii) allowing for
increased vertical integration through the use of Laidlaw Environmental
facilities to process waste streams collected by Safety-Kleen service centers;
and (iv) providing significant expansion into the solvent recycling market.

If the Merger is consummated, Laidlaw Environmental will consider the sale
of two assets of Safety-Kleen: (i) Safety-Kleen's European operations and (ii)
Safety-Kleen's oil recovery services business. These divestitures (and possibly
other divestitures) will be further assessed as additional information becomes
available. See "Reasons for the Offer -- Enhanced Business Opportunities."

BACKGROUND OF THE OFFER

On August 8, 1997 Safety-Kleen announced the resignation of John G.
Johnson, Jr., President and Chief Executive Officer of Safety-Kleen. Donald W.
Brinckman, Chairman of Safety-Kleen's Board of Directors, who had previously
served as Safety-Kleen's Chief Executive Officer from 1968 until December 31,
1994, was appointed Chief Executive Officer. Safety-Kleen also announced that
its Board of Directors had engaged the services of William Blair to act as
advisor to Safety-Kleen and manage the process of exploring strategic options
for enhancing shareholder value.

On August 8, 1997, William Blair sent a copy of the Safety-Kleen
Confidentiality Letter to one of Laidlaw Environmental's investment bankers, Mr.
David E. Thomas, Jr. of Raymond James & Associates, Inc. ("Raymond James") and
stated that an offering circular would be available early in the week of August
18, 1997, and that such circular would be distributed to parties that had
executed a confidentiality agreement. Laidlaw Environmental did not respond to
this letter and William Blair called Laidlaw Environmental's representative and
asked that Laidlaw Environmental sign the confidentiality agreement. Laidlaw
Environmental was willing to sign a confidentiality agreement, but not the one
proposed by Safety-Kleen, which contained a two year standstill provision.

In mid-September 1997, there were further discussions between the two
investment banks in which Laidlaw Environmental's representatives requested a
meeting of the two companies and their advisors so that Laidlaw Environmental
could fully describe why a business combination was in both companies' best
interests. Safety-Kleen's representative continued to request that Laidlaw
Environmental sign a confidentiality agreement containing the two-year
standstill provision. He also stated that if Laidlaw Environmental would submit
its proposal in writing, Safety-Kleen would consider a meeting with Laidlaw
Environmental.

On September 24, 1997, Mr. Thomas delivered a letter to Mr. Jeffrey W.
Corum of William Blair, informing Mr. Corum of Laidlaw Environmental's interest
in pursuing negotiations with Safety-Kleen. In particular, Mr. Thomas's letter
requested a meeting between the management of Laidlaw Environmental and the
management of Safety-Kleen and pointed out several unique features of Laidlaw
Environmental's proposed transaction including the potential cost savings
available from combining the operations of Laidlaw Environmental and
Safety-Kleen which were estimated to range from $100 to $130 million annually.
Mr. Thomas's letter suggested structuring the transaction as a reverse merger in
which Safety-Kleen would issue one share of its stock for every three shares of
Laidlaw Environmental stock. The full text of Mr. Thomas's letter is set forth
below under the heading "Reasons for the Offer -- Background of the Offer."

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<PAGE> 13

Shortly thereafter Mr. Corum responded to Mr. Thomas's letter by telephone
stating that only upon Laidlaw Environmental's delivery of a confidentiality and
standstill agreement acceptable to Safety-Kleen, would Safety-Kleen meet with
Laidlaw Environmental. Subsequent to their telephone conversations, Mr. James R.
Bullock, Chairman of Laidlaw Environmental, attempted to call Mr. Brinckman, who
did not return his call. Mr. Bullock then called Mr. E. David Coolidge of
William Blair in an effort to arrange a meeting with Safety-Kleen. Mr. Coolidge
repeated Safety-Kleen's refusal to meet with Laidlaw Environmental in the
absence of a confidentiality and standstill agreement.

On November 3, 1997, the Laidlaw Environmental Board of Directors met and
determined to proceed with the Offer as well as to retain Bear, Stearns & Co.
Inc. ("Bear Stearns") to work together with Raymond James as its financial
adviser. Laidlaw Environmental management had previously retained Katten Muchin
& Zavis to serve as legal counsel. Also on November 3, 1997, in a letter to Mr.
Brinckman, Mr. Bullock informed Mr. Brinckman and the Safety-Kleen Board of
Directors of Laidlaw Environmental's intention to acquire Safety-Kleen for a
price per Share of $14.00 in cash and 2.4 shares of Laidlaw Environmental Common
Stock (the "Initial Offer"), that Laidlaw Environmental was willing to execute a
confidentiality agreement provided such agreement did not contain a standstill
provision, and that Laidlaw Environmental continued to believe that annual cost
savings and synergies resulting from a combination of the two companies would
exceed $90 million annually. For these and other reasons, Laidlaw Environmental
would consider and pursue various options with respect to an acquisition of
Safety-Kleen notwithstanding Safety-Kleen's refusal to meet with representatives
of Laidlaw Environmental. The letter also informed Mr. Brinckman that Laidlaw
Environmental had executed a commitment letter with Toronto-Dominion Bank to
provide all necessary financing for the Offer and the Merger and again
encouraged Mr. Brinckman and the Safety-Kleen Board of Directors to meet with
representatives of Laidlaw Environmental to discuss the possibility of a
mutually beneficial negotiated transaction. The full text of Mr. Bullock's
letter is set forth below under the heading "Background of the Offer."

On November 3, 1997 after receipt of Mr. Bullock's letter, Mr. Brinckman
delivered a letter to Mr. Bullock requesting that Laidlaw Environmental execute
a confidentiality and standstill agreement and informing Mr. Bullock that the
Safety-Kleen Board of Directors would fully consider Laidlaw Environmental's
proposal along with others received by Safety-Kleen. In addition, Mr. Brinckman
stated that representatives of Safety-Kleen, together with its financial
advisors, would meet with representatives of Laidlaw Environmental, together
with its financial advisors, to discuss information concerning Laidlaw
Environmental and the estimated cost savings and synergies. The full text of Mr.
Brinckman's letter is set forth below under the heading " Background of the
Offer."

On November 4, 1997, Laidlaw Environmental publicly announced its intention
to pursue the Initial Offer and the Merger.

On November 5, 1997, Mr. Bullock and a representative of Bear Stearns met
with Mr. Brinckman, Mr. Joseph Chalhoub, Senior Vice President of Safety-Kleen,
and representatives of William Blair to discuss potential synergies that could
be achieved through a combination of the two companies and ways the parties
could work together. Mr. Bullock stated that Laidlaw Environmental was prepared
to sign a mutual confidentiality agreement that would not contain a standstill
provision so that Laidlaw Environmental and Safety-Kleen could share information
with each other. In response, Safety-Kleen repeated its requirement that Laidlaw
Environmental sign a confidentiality and standstill agreement.

Subsequent to the November 5th meeting, the representatives of the parties
exchanged correspondence reiterating their positions with respect to the
confidentiality and standstill agreement.

On November 13, 1997, Laidlaw Environmental filed the Registration
Statement of which this Prospectus is a part. A copy of the Registration
Statement was sent to Mr. Brinckman, along with a letter from Mr. Bullock
emphasizing the strategic importance of combining the two companies and
reiterating Laidlaw Environmental's desire to engage in negotiations with
Safety-Kleen. Mr. Bullock also expressed Laidlaw Environmental's willingness to
put the decision to accept the Initial Offer directly to the Safety-Kleen
Shareholders. Mr. Bullock requested the cooperation of the Safety-Kleen Board of
Directors in eliminating

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<PAGE> 14

any antitakeover obstacles which would prohibit the shareholders from accepting
the Initial Offer. The full text of Mr. Bullock's letter is set forth below
under the heading "-- Background of the Offer."

On November 13, 1997, Laidlaw Environmental also sent a notice to
Safety-Kleen pursuant to Section 180.1150 of the Wisconsin Statutes requesting
that the Safety-Kleen Board of Directors convene a special meeting of
shareholders and submit for shareholder approval a resolution to restore regular
voting power to any Shares Laidlaw Environmental would acquire as a result of
the Offer. See "The Offer -- Conditions of the Offer -- Wisconsin Statutory
Condition."

By a second letter dated November 13, 1997, Laidlaw Environmental, having
in its judgment complied with the Wisconsin Statutes, also requested the right
to inspect and copy the Safety-Kleen Shareholder list for the purpose of
communicating directly with the Safety-Kleen Shareholders. See "Litigation."

On November 20, 1997, Safety-Kleen announced that it had entered into the
Buyout Merger Agreement with the Buyout Group. Pursuant to the Buyout Merger
Agreement, an acquisition subsidiary formed by the Buyout Group would merge with
and into Safety-Kleen (the "Buyout Merger"), with Safety-Kleen as the surviving
company in a transaction in which the Safety-Kleen Shareholders would receive
$27.00 per Share in cash. As a result of the Buyout Merger, Safety-Kleen would
become a wholly-owned subsidiary of a new holding company formed by the Buyout
Group and would continue to operate under its current management and out of its
current headquarters. The closing of the Buyout Merger is subject to certain
conditions, including the approval of at least 66 2/3% of Safety-Kleen's
Shareholders and both the debt and equity funding of the financing arrangements
of the Buyout Group. Pursuant to the Buyout Merger Agreement, Safety-Kleen is
required to pay a termination fee of $50 million and to reimburse the Buyout
Group for its expenses in an amount up to $25 million under certain conditions,
including in the event that the Buyout Merger Agreement is terminated and the
Offer by Laidlaw Environmental is accepted by the Safety-Kleen Shareholders.

On November 20, 1997, in a letter from Mr. Bullock to Mr. Brinckman,
Laidlaw Environmental increased its offer to $30.00 per share, consisting of
$15.00 in cash (subject to adjustment for break-up fees, new severance
arrangements and other expenses), and $15.00 in Laidlaw Environmental Common
Stock, subject to variation as described herein. The full text of Mr. Bullock's
letter is set forth under the heading "Background of the Offer."

LITIGATION

Claims filed by Safety-Kleen. On November 17, 1997, Safety-Kleen commenced
litigation in the United States District Court for the Northern District of
Illinois alleging that Laidlaw Environmental violated Section 5(b)(1) of the
Securities Act of 1933 by making a "premature offer" and unlawful proxy
solicitation. As a remedy for that alleged violation, Safety-Kleen requests that
it be relieved of its obligation to provide Laidlaw Environmental with its list
of shareholders so that Safety-Kleen will not be in a position of facilitating a
violation of the federal securities laws. The Safety-Kleen complaint ("the
Safety-Kleen Complaint") further alleges that Laidlaw Environmental's request
that Safety-Kleen call a special meeting of its shareholders fails to comply
with the state law notice requirements. Safety-Kleen contends that the notice
served by Laidlaw Environmental fails to provide sufficient disclosure of the
financing to be used in connection with its Offer. Safety-Kleen seeks
declaratory judgment that it need not schedule the special meeting or provide
access to its shareholder list.

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entering into the Buyout Transaction, and agreeing to the unlawful provisions of
the merger agreement, including the break-up fee, (x) compelling the Director
Defendants to carry out their fiduciary duties to Safety-Kleen's shareholders,
including Laidlaw Environmental, by implementing and adhering to procedures
under which the transaction providing the best value reasonably available can be
obtained for Safety-Kleen's shareholders, (y) enjoining Safety-Kleen and the
Director Defendants from proceeding with the Buyout Transaction or paying a
"break-up fee" to the Buyout Group, and (z) directing the Director Defendants to
negotiate with Laidlaw Environmental regarding the Offer; (iv) an order
compelling the Director Defendants to amend the Rights Plan to make it
inapplicable to the Offer or to redeem the rights; (v) an order (pursuant to the
derivative claim) requiring the Director Defendants to account to Safety-Kleen
for waste of corporate assets and all other damages caused by their approval of
the Buyout Transaction; and (vi) an award of costs of suit and reasonable
attorneys' fees, and for such other relief as the Court may deem just and
appropriate.

MARKET PRICES

The Shares are listed and traded on the NYSE under the symbol "SK." The
Laidlaw Environmental Common Stock is listed and traded on the NYSE under the
symbol "LLE," and is also traded on the Pacific Exchange, Inc. See "Market
Prices" below for historical information regarding the market price per share of
the Shares and the Laidlaw Environmental Common Stock. On August 7, 1997, the
date prior to the date Safety-Kleen announced its retention of William Blair,
the closing price per Share, as reported on the NYSE Composite Tape, was
$17.8125, and the closing price per share of Laidlaw Environmental Common Stock,
as reported on the NYSE Composite Tape, was $3.1875. On November 3, 1997, the
date prior to the date of the public announcement of Laidlaw Environmental's
intention to acquire Safety-Kleen, the closing price per Share, as reported on
the NYSE Composite Tape, was $21.9375, and the closing price per share of
Laidlaw Environmental Common Stock, as reported on the NYSE Composite Tape, was
$4.9375. On November 19, 1997, the date prior to the announcement of the Buyout
Proposal and Laidlaw Environmental's revised Offer, the closing price per Share,
as reported on the NYSE Composite Tape, was $26.0625. On , 1997, the
date prior to the date of this Prospectus, the closing price per Share, as
reported on the NYSE Composite Tape, was $ , and the closing price per
share of Laidlaw Environmental Common Stock, as reported on the NYSE Composite
Tape, was $ . Shareholders are urged to obtain current market
information for Laidlaw Environmental Common Stock and the Shares. No assurance
can be given as to market prices of Laidlaw Environmental Common Stock and the
Shares at the Expiration Date of the Offer. The market value of the shares of
Laidlaw Environmental Common Stock that holders of Shares will receive upon
consummation of the Offer may vary from the market value of shares of Laidlaw
Environmental Common Stock that holders of Shares would have received if the
Offer had been consummated on the date of this Prospectus.

THE OFFER

General. Laidlaw Environmental hereby offers, upon the terms and subject
to the conditions set forth herein and in the related Letter of Transmittal, to
exchange the Offer Consideration for each outstanding Share (and the
accompanying Rights, if any) validly tendered on or prior to the Expiration Date
and not properly withdrawn. The Offer Consideration consists of $15.00 net in
cash (subject to adjustment as described below) and that number of shares of
Laidlaw Environmental Common Stock equal to the Exchange Ratio. "Exchange Ratio"
means the quotient (rounded to the nearest 1/100,000) determined by dividing
$15.00 by the weighted average trading prices for Laidlaw Environmental Common
Stock (as reported on the NYSE Composite Transactions reporting system as
published in The Wall Street Journal or, if not published therein, in another
authoritative source) (the "Laidlaw Environmental Average Price") for ten NYSE
trading days (each, a "Trading Day") selected by lot from the twenty trading
days ending three business days immediately prior to the Expiration Date,
provided, that the Exchange Ratio shall not be less than 2.80 nor greater than
3.50. Accordingly, subject to changes in the actual market value of Laidlaw
Environmental Common Stock on the date that Shares are actually exchanged, each
Share will be exchanged for (in addition to the Cash Consideration) Laidlaw
Environmental Common Stock having a market value of $15.00 if the Laidlaw
Environmental Average Price is between $4.28571 and $5.35714. If the Laidlaw
Environmental Average Price is greater than $5.35714, each Share will be
exchanged for (in addition to the Cash Consideration) Laidlaw Environmental
Common Stock having a market value of more than $15.00, and,

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<PAGE> 16

conversely, if the Laidlaw Environmental Average Price is less than $4.28571,
each Share will be exchanged for (in addition to the Cash Consideration) Laidlaw
Environmental Common Stock having a market value of less than $15.00, in each
case subject to changes in the actual market value of Laidlaw Environmental
Common Stock on the date that Shares are actually exchanged. Cash will be paid
in lieu of any fractional shares of Laidlaw Environmental Common Stock. See "The
Offer -- The Exchange Ratio". The term "Expiration Date" shall mean 5:00 p.m.,
New York City time on , 1997, unless and until Laidlaw Environmental
extends the period of time for which the Offer is open, in which event the term
"Expiration Date" shall mean the latest time and date at which the Offer, as so
extended by Laidlaw Environmental, shall expire. No certificates representing
fractional shares of Laidlaw Environmental Common Stock will be issued pursuant
to the Offer. Each tendering Safety-Kleen Shareholder who would otherwise be
entitled to a fractional share of Laidlaw Environmental Common Stock will
receive cash in lieu thereof. See "The Offer -- Cash in Lieu of Fractional
Shares of Laidlaw Environmental Common Stock." Laidlaw Environmental Common
Stock is listed for trading under the symbol "LLE" on the NYSE. On ,
1997, the closing price of Laidlaw Environmental Common Stock on the NYSE was
$ . Based on such closing price, the Exchange Ratio would be ,
and each Share would be converted into $15.00 net in cash (subject to adjustment
as described below) and shares of Laidlaw Environmental Common Stock. The
Exchange Ratio will change as the market price of the Laidlaw Environmental
Common Stock changes. Safety-Kleen Shareholders may call (800) - any
time on or after the date hereof through the Expiration Date for the current
Exchange Ratio calculated for purposes of responding to telephone inquiries
based on the average of the closing prices of Laidlaw Environmental Common Stock
for the ten consecutive Trading Days preceding the date the call is placed. The
actual Laidlaw Environmental Average Price and Exchange Ratio will be calculated
as of the third Trading Day immediately prior to the Expiration Date, as
described above, and a press release will be issued announcing the actual
Exchange Ratio prior to the opening of the second Trading Day prior to the
Expiration Date (as it may be extended from time to time). A registration
statement relating to the Laidlaw Environmental Common Stock to be exchanged in
the Offer has been filed with the Commission. See "The Offer -- General."

The Cash Consideration to be paid pursuant to the Offer shall be reduced by
the quotient of (x) the aggregate amount of (i) any termination fees or expenses
paid or reimbursed (or payable or reimbursable) by Safety-Kleen pursuant to the
Buyout Merger Agreement and (ii) any incremental costs, including the costs of
new severance arrangements and other expenses Safety-Kleen may incur in
connection with the Buyout Merger Agreement (such fees, expenses and other
costs, the "Buyout Proposal Expenses") divided by (y) the number of outstanding
Shares (on a fully diluted basis) as of the Expiration Date. On November 24,
1997, Laidlaw Environmental filed a counterclaim in the United States District
Court for the Northern District of Illinois, against Safety-Kleen and its board
of directors seeking, among other things, preliminary and permanent injunctive
relief declaring invalid the termination fee and expense reimbursement
provisions of the Buyout Merger Agreement, and any severance arrangements for
the benefit of Safety-Kleen management that may have been entered into by
Safety-Kleen in connection with the Buyout Merger Agreement. Laidlaw
Environmental is also submitting a request in writing to Safety-Kleen for a
statement setting forth any incremental costs, including the cost of new
severance arrangements and other expenses that Safety-Kleen has incurred or may
reasonably be expected to incur in connection with the Buyout Merger Agreement.
See "Prospectus Summary -- Litigation."

Conditions of the Offer. Laidlaw Environmental's obligation to exchange
the Offer Consideration for Shares pursuant to the Offer is conditioned upon,
among other things, the satisfaction or, where applicable, waiver of each of the
Offer Conditions. Subject to the applicable rules and regulations of the
Commission, Laidlaw Environmental expressly reserves the right, in its sole
discretion, at any time or from time to time, to delay acceptance for exchange
or, regardless of whether such Shares were theretofore accepted for exchange,
exchange of any Shares pursuant to the Offer or to amend or terminate the Offer
and not accept for exchange or exchange any Shares not theretofore accepted for
exchange or exchanged, upon the failure of any of the conditions to the Offer to
be satisfied. Laidlaw Environmental reserves the absolute right to waive any
defect or irregularity in the tender of any securities and to waive any of the
Offer Conditions (other than the Laidlaw Environmental Stockholder Approval
Condition, the Regulatory Approval Condition and the condition related to the
effectiveness of the Registration Statement). Although Laidlaw Environmental
reserves the right to do
7
<PAGE> 17

so, Laidlaw Environmental does not currently intend to waive the Minimum Tender
Condition, the Wisconsin Statutory Condition, the Rights Plan Condition or the
Buyout Expense Condition. See "The Offer -- Conditions of the Offer -- Minimum
Tender Condition," "-- Laidlaw Environmental Stockholder Approval Condition,"
"-- Rights Plan Condition," "-- Wisconsin Statutory Condition," "-- Regulatory
Approval Condition," "-- Buyout Expense Condition," and "-- Certain Other
Conditions of the Offer." Waiver or amendment of any of these conditions may
require an extension of the Offer.

Regulatory Approvals. The acquisition of Shares by Laidlaw Environmental
pursuant to the Offer is subject to the Hart-Scott-Rodino Antitrust Improvement
Act of 1976, as amended (the "HSR Act") and the rules (the "Rules") that have
been promulgated thereunder. Laidlaw will file with the Antitrust Division of
the Department of Justice (the "Antitrust Division") and the Federal Trade
Commission (the "FTC") a Hart-Scott-Rodino Notification and Report Form with
respect to the Offer to acquire up to 100% of the outstanding Shares, and
Laidlaw Environmental and LES Acquisition will not acquire any Shares until the
applicable waiting period for such acquisition has expired or been terminated.

European Regulatory Approvals. The acquisition of Shares by Laidlaw
Environmental pursuant to the Offer is subject to prior notification
requirements of several of the member countries of the European Union in which
Safety-Kleen operates. Based on the limited information concerning Safety-Kleen
that is available to Laidlaw Environmental, filings will be necessary in the
Republic of Ireland and Federal Republic of Germany. In addition, filings may
also be necessary in Italy and Belgium. The necessary filings must be made in
sufficient time to allow the passing of a one month waiting period before
Laidlaw Environmental's acquisition of Shares pursuant to this Offer may be
completed. No pre-merger notification under the European Economic Community's
Merger Control Regulation is required for the proposed transaction.

Canadian Competitive Act. Under the Canadian Federal Competition Act (the
"Competition Act"), acquisition transactions, insofar as they relate to the
acquisition of such Canadian subsidiaries, qualify as a "merger" if they are of
sufficient size to be subject to the notification and waiting period
requirements of the Competition Act. The Competition Act is administered by the
Canadian Director of Investigation and Research appointed under the Competition
Act (the "Competition Act Director"). Laidlaw Environmental believes that the
proposed transaction requires notification and intends to file the required
information with the Competition Act Director.

Under separate "merger" provisions of the Competition Act, which operate
independently of its notification and waiting period requirements, if an
acquisition is likely to give rise to a substantial prevention or lessening of
competition in a market in Canada, the Competition Act Director may apply for a
remedial order (such as an injunction or an order to divest specified assets or
securities) to be issued by a quasi-judicial body.

Timing of the Offer. The Offer is currently scheduled to expire on
, 1997; however, it is Laidlaw Environmental's current intention to
extend the Offer from time to time as necessary until all conditions to the
Offer have been satisfied or waived. See "The Offer -- Extension, Termination
and Amendment." Laidlaw Environmental has received a commitment letter from
Toronto-Dominion Bank in which it states that it will provide or arrange credit
facilities in the amount necessary to fund payment of the Cash Consideration.
See "The Offer -- Source and Amount of Funds." In the unlikely event that the
financing is not available, Laidlaw Environmental currently intends to extend
the Offer to ensure that five business days remain for Safety-Kleen Shareholders
to tender their Shares in the Offer subsequent to obtaining such financing. See
"The Offer -- Source and Amount of Funds." Laidlaw Environmental expects that
the Laidlaw Environmental Stockholder Approval Condition will be satisfied on or
about , 1997, the date on which it plans to call a special meeting
of its stockholders (the "Laidlaw Environmental Special Meeting"), to approve
the increase in the number of authorized shares of Laidlaw Environmental Common
Stock from 350,000,000 to 750,000,000 and the issuance of shares of Laidlaw
Environmental Common Stock in connection with the Offer and the Merger.

Extension, Termination and Amendment. Laidlaw Environmental expressly
reserves the right (but will not be obligated), in its sole discretion, at any
time or from time to time, and regardless of whether any of the events set forth
in "The Offer -- Conditions of the Offer" shall have occurred or shall have been
determined by Laidlaw Environmental to have occurred, (a) to extend the period
of time during which the Offer is open
8
<PAGE> 18

by giving oral or written notice of such extension to the Exchange Agent, which
extension will be announced no later than 9:00 a.m., New York City time, on the
next business day after the previously scheduled Expiration Date, and (b) to
amend the Offer in any respect (including, without limitation, by decreasing or
increasing the consideration offered in the Offer to holders of Shares and/or by
increasing or decreasing the number of Shares being sought in the Offer) by
giving oral or written notice of such amendment to the Exchange Agent. The
rights reserved by Laidlaw Environmental in this paragraph are in addition to
Laidlaw Environmental's right to terminate the Offer as described in "The
Offer -- Extension, Termination and Amendment." There can be no assurance that
Laidlaw Environmental will exercise its right to extend the Offer. However, it
is Laidlaw Environmental's current intention to extend the Offer until all Offer
Conditions have been satisfied or waived. See "The Offer -- Extension,
Termination and Amendment." During any such extension, all Shares previously
tendered and not withdrawn will remain subject to the Offer, subject to the
right of a tendering Safety-Kleen Shareholder to withdraw his or her Shares. See
"The Offer -- Withdrawal Rights."

Exchange of Shares; Delivery of Laidlaw Environmental Common Stock and Cash
Consideration. Upon the terms and subject to the conditions of the Offer
(including, if the Offer is extended or amended, the terms and conditions of any
such extension or amendment), Laidlaw Environmental will accept for exchange,
and will exchange, Shares (and Rights, if applicable) validly tendered and not
properly withdrawn as promptly as practicable following the Expiration Date. See
"The Offer -- Exchange of Shares; Delivery of Laidlaw Environmental Common Stock
and Cash Consideration."

Withdrawal Rights. Tenders of Shares (and Rights, if applicable) made
pursuant to the Offer are irrevocable, except that Shares (and Rights, if
applicable) tendered pursuant to the Offer may be withdrawn at any time prior to
the Expiration Date, and, unless theretofore accepted for exchange and exchanged
by Laidlaw Environmental for the Offer Consideration pursuant to the Offer, may
also be withdrawn at any time after , 1997. See "The
Offer -- Withdrawal Rights."

Procedure for Tendering Shares. For a Safety-Kleen Shareholder to validly
tender Shares (and Rights, if applicable) pursuant to the Offer, (i) a properly
completed and duly executed Letter of Transmittal (or manually executed
facsimile thereof), together with any required signature guarantees, or an
Agent's Message (as defined herein) in connection with a book-entry transfer,
and any other required documents, must be transmitted to and received by the
Exchange Agent at one of its addresses set forth on the back cover of this
Prospectus and either certificates for tendered Shares (and Rights, if
applicable) must be received by the Exchange Agent at such address or such
Shares (and Rights, if applicable) must be tendered pursuant to the procedures
for book-entry transfer (in the case of Rights, if available) set forth under
"The Offer -- Procedure for Tendering" (and a confirmation of receipt of such
tender received), in each case, prior to the Expiration Date, or (ii) such
Safety-Kleen Shareholder must comply with the guaranteed delivery procedure set
forth under "The Offer -- Procedure for Tendering."

THE METHOD OF DELIVERY OF SHARE CERTIFICATES (AND RIGHTS CERTIFICATES, IF
APPLICABLE) AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY
BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION AND RISK OF THE TENDERING
SHAREHOLDER, AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY
THE EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME
SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.

THE MERGER

The purpose of the Offer is to enable Laidlaw Environmental to acquire
control of, and ultimately the entire equity interest in, Safety-Kleen. Laidlaw
Environmental presently intends, following consummation of
9
<PAGE> 19

the Offer, to propose and seek to have LES Acquisition merge with Safety-Kleen.
In the Merger, each then outstanding Share (other than Shares owned by Laidlaw
Environmental or any of its affiliates, and Shares held in the treasury of
Safety-Kleen (if Safety-Kleen is so authorized) or by any subsidiary of
Safety-Kleen) would be cancelled in exchange for the right to receive the same
consideration paid pursuant to the Offer. Safety-Kleen has not agreed to provide
Laidlaw Environmental with information that might be relevant to the structuring
of the Merger. Laidlaw Environmental therefore reserves the right to change the
structure of the Merger upon receipt of such information.

If the Minimum Tender Condition and other Offer Conditions are satisfied,
and the Offer is consummated, Laidlaw Environmental and its affiliates will own
not less than two-thirds of the outstanding Shares. Accordingly, Laidlaw
Environmental and its affiliates will at such time have sufficient voting power
in Safety-Kleen to approve the Merger independently of the votes of any other
Safety-Kleen Shareholders. Laidlaw Environmental presently intends to vote any
and all Shares owned by Laidlaw Environmental and its affiliates following
consummation of the Offer to approve the Merger.

Safety-Kleen Shareholders will have appraisal rights under Wisconsin law in
connection with the Merger. See "-- Dissenter Rights."

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

The exchange of Shares for Laidlaw Environmental Common Stock and cash
pursuant to the Offer and Merger will be a taxable transaction for U.S. federal
income tax purposes and may also be taxable under applicable state, local and
foreign tax laws. If the Board of Safety-Kleen agrees to the Offer, the Merger
may be restructured to be a partially tax-free merger for U.S. federal income
tax purposes.

All Safety-Kleen Shareholders should carefully read the summary of the
federal income tax consequences of the Offer and the Merger under "The Offer --
Certain Federal Income Tax Consequences" and are urged to consult with their own
tax advisors as to the federal, state, local and foreign tax consequences in
their particular circumstances.

EFFECT OF OFFER ON MARKET FOR SHARES; REGISTRATION UNDER THE EXCHANGE ACT

The exchange of Shares pursuant to the Offer will reduce the number of
holders of Shares and the number of Shares that might otherwise trade publicly
and, depending upon the number of Shares so purchased, could adversely affect
the liquidity and market value of the remaining Shares held by the public.

The Shares are listed and traded on the NYSE. Depending upon the number of
Shares acquired pursuant to the Offer, following consummation of the Offer, the
Shares may no longer meet the requirements of the NYSE for continued listing and
may no longer constitute "margin securities" for the purposes of the Federal
Reserve Board's margin regulations, in which event the Shares would be
ineligible as collateral for margin loans made by brokers. For a description of
the treatment of Shares in the Merger, see "The Merger."

DISSENTER RIGHTS

Holders of Shares do not have appraisal rights as a result of the Offer.
However, in the event the Merger is consummated, the Safety-Kleen Shareholders
would have appraisal rights with respect to the Merger under Section 180.1302 of
the Wisconsin Statutes.

COMPARISON OF THE RIGHTS OF HOLDERS OF SHARES AND LAIDLAW ENVIRONMENTAL COMMON
STOCK

As a consequence of the exchange of Shares for shares of Laidlaw
Environmental Common Stock in the Offer and the cancellation of Shares as a
result of the Merger, shareholders of Safety-Kleen, a corporation incorporated
under the laws of Wisconsin, would become shareholders of Laidlaw Environmental,
a Delaware corporation. Such holders would have certain rights as Laidlaw
Environmental shareholders that are different from the rights they currently
have in Safety-Kleen, both because of the differences between the Laidlaw
Environmental Certificate of Incorporation (the "Laidlaw Environmental
Certificate") and Laidlaw Environmental's by-laws (the "Laidlaw Environmental
By-laws"), on the one hand, and the Safety-Kleen Articles of
10
<PAGE> 20

Incorporation (the "Safety-Kleen Articles") and by-laws (the "Safety-Kleen
By-Laws"), on the other hand, and because of differences between Wisconsin and
Delaware corporation law. For a comparison of the charter and by-law provisions
of Laidlaw Environmental and Safety-Kleen and of Wisconsin and Delaware law, see
"Comparison of the Rights of Holders of Shares and Laidlaw Environmental Common
Stock."

DESCRIPTION OF LAIDLAW ENVIRONMENTAL CAPITAL STOCK

The authorized capital stock of Laidlaw Environmental consists of
350,000,000 shares of Laidlaw Environmental Common Stock, par value $1.00 per
share and 1,000,000 shares of preference stock, $1.00 par value. As of October
14, 1997, there were 180,549,911 shares of Laidlaw Environmental Common Stock
issued and outstanding. No preferred stock has been issued.

Holders of shares of Laidlaw Environmental Common Stock are entitled to one
vote per share for each share held. Subject to the rights of holders of shares
of outstanding Laidlaw Environmental Preferred Stock (if any), holders of shares
of Laidlaw Environmental Common Stock have equal rights to participate in
dividends when declared and, in the event of liquidation, in the net assets of
Laidlaw Environmental available for distribution to shareholders.

For information relating to ownership of Laidlaw Environmental Common Stock
by certain beneficial owners and directors and executive officers of Laidlaw
Environmental, see the Laidlaw Environmental 1997 Annual Meeting Proxy
Statement. As of October 14, 1997, as a group, Laidlaw Environmental's
directors, executive officers and their affiliates (including Laidlaw Inc.)
beneficially owned approximately 70.29% of the outstanding shares of Laidlaw
Environmental Common Stock.

For additional information concerning the capital stock of Laidlaw
Environmental, see "Description of Laidlaw Environmental Capital Stock."

THE EXCHANGE AGENT

IBJ Schroder Bank & Trust Company has been appointed Exchange Agent in
connection with the Offer. A duly executed Letter of Transmittal (or facsimile
copies thereof), together with any required signature guarantees, or an Agent's
Message in connection with a book-entry transfer, and certificates for Shares
(and Rights, if applicable) should be sent by each tendering Safety-Kleen
Shareholder or his or her broker, dealer, bank or nominee to the Exchange Agent
at the addresses set forth on the back cover of this Prospectus.

REQUEST FOR ASSISTANCE AND ADDITIONAL COPIES

Requests for information or assistance concerning the Offer may be directed
to the Dealer Manager or the Information Agent at their respective addresses set
forth on the back cover of this Prospectus. Requests for additional copies of
this Prospectus and the Letter of Transmittal should be directed to the
Information Agent.

LAIDLAW ENVIRONMENTAL AND SAFETY-KLEEN COMPARATIVE PER SHARE DATA

The following table sets forth comparative per share data of Laidlaw
Environmental and Safety-Kleen on both a historical and pro forma combined
basis. This table should be read in conjunction with each entity's historical
financial statements and notes thereto as set forth in the filings incorporated
by reference herein (but which in the case of Safety-Kleen are not covered by
the report of Safety-Kleen's independent accountants for purposes of this
Prospectus), and in conjunction with the unaudited pro forma combined financial
information appearing elsewhere in this Prospectus. See "Laidlaw Environmental
and Safety-Kleen Unaudited Pro Forma Combined Financial Information."
11
<PAGE> 21

The Merger will be accounted for as a purchase, and the pro forma
information set forth below presents pro forma combined information for the
fiscal year of Laidlaw Environmental ended August 31, 1997. This information
does not reflect the estimated cost savings of approximately $100 to $130
million that Laidlaw Environmental believes may result from the Merger. The pro
forma combined per share data is not necessarily indicative of actual results
had the Offer, the Merger and the other transactions described herein occurred
on such dates or of future expected results.

<TABLE>
<CAPTION>
LAIDLAW
ENVIRONMENTAL/
LAIDLAW SAFETY-KLEEN SAFETY-KLEEN
ENVIRONMENTAL SAFETY-KLEEN PRO FORMA PRO FORMA
HISTORICAL HISTORICAL COMBINED(1) EQUIVALENT(2)
------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
Book value per common share:
August 31, 1997............................ $ 1.82 $8.49 $ 3.34 $10.28
Year ended August 31, 1997:
Income (loss) per common share from
continuing operations................... (1.33) 1.04 (0.62) (1.91)
Cash dividends............................. 0.00 0.36 0.00 0.00
</TABLE>

- ---------------

(1) See "Laidlaw Environmental and Safety-Kleen Selected Unaudited Pro Forma
Financial Information."

(2) The Safety-Kleen pro forma equivalent represents the Laidlaw
Environmental/Safety-Kleen pro forma combined book value, dividends and
income (loss) per common share multiplied by an Exchange Ratio of 3.077,
which assumes a Laidlaw Environmental share price of $4.875.

SELECTED FINANCIAL DATA

The summary below sets forth selected historical financial data and
selected unaudited pro forma combined financial data. This financial data should
be read in conjunction with the historical financial statements and notes
thereto contained in the filings incorporated by reference herein (but which, in
the case of Safety-Kleen, are not covered by the report of Safety-Kleen's
independent accountants for purposes of this Prospectus), and in conjunction
with the unaudited pro forma combined financial information and notes thereto
appearing elsewhere in this Prospectus. See "Unaudited Pro Forma Combined
Financial Information."

12
<PAGE> 22

SELECTED HISTORICAL FINANCIAL DATA OF LAIDLAW ENVIRONMENTAL

The selected historical financial data of Laidlaw Environmental set forth
below has been derived from financial statements of Laidlaw Environmental as
they appeared in the Laidlaw Environmental 1997 Form 10-K. The Laidlaw
Environmental 10-K should be read in conjunction with Laidlaw Environmental's
selected historical financial data.

<TABLE>
<CAPTION>
YEAR ENDED AUGUST 31,
----------------------------------------------------------
1997 1996 1995 1994 1993
---------- ---------- ---------- -------- --------
($ IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
STATEMENT OF INCOME DATA:
Revenues............................ $ 678,619 $ 652,973 $ 599,241 $517,804 $511,554
Operating income before
restructuring charge.............. $ 66,983 $ 57,319 $ 59,859 $ 45,548 $ 52,400
Applicable margin................... 9.9% 8.8% 10.0% 8.8% 10.2%
Income (loss) from continuing
operations(1)..................... $ (183,452) $ 6,714 $ 16,765 $ 22,531 $ 11,654
Income (loss) per share from
continuing operations(1).......... (1.329) 0.056 0.140 0.188 0.097
Cash dividends per common share..... -- -- -- -- --
BALANCE SHEET DATA:
Working capital..................... 76,095 40,617 60,075 90,831 119,522
Total assets........................ 1,610,878 1,491,294 1,367,411 974,053 947,976
Long-term debt...................... 540,096 55,838 64,256 18,454 24,253
Stockholders' equity(2)............. 327,965 1,094,777 1,056,266 798,597 795,887
Weighted average common and common
stock equivalents outstanding
(000's)........................... 138,033 120,000 120,000 120,000 120,000
</TABLE>

- ---------------

(1) Fiscal year 1997 includes restructuring charge, net of tax benefit, of $200
million ($332 million pre-tax) or $1.45 per share.

(2) For fiscal years 1993 to 1996 inclusive, stockholders' equity represents the
net investment of Laidlaw Inc. in Laidlaw Environmental.

13
<PAGE> 23

SELECTED HISTORICAL FINANCIAL DATA OF SAFETY-KLEEN

The selected historical financial data of Safety-Kleen set forth below has
been derived from financial statements of Safety-Kleen as they appeared in
Safety-Kleen's Form 10-K filed with the Commission for each of the five fiscal
years in the period ended December 28, 1996 and the Safety-Kleen Form 10-Q for
the period ended September 6, 1997. The Safety-Kleen 1996 Form 10-K should also
be read in conjunction with Safety-Kleen's selected historical financial data.

<TABLE>
<CAPTION>
36 WEEKS ENDED FISCAL YEAR
--------------------------- ---------------------------------------------------------------
SEPTEMBER 6, SEPTEMBER 7,
1997 1996 1996 1995 1994 1993 1992(3)
------------ ------------ ---------- ---------- --------- ---------- ----------
($ IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF INCOME
DATA:
Revenues............. $ 680,172 $626,176 $ 923,126 $ 859,251 $ 791,267 $ 795,508 $ 794,542
Operating income
before
restructuring
charge............. $ 76,450 $ 80,008 $ 119,490 $ 108,463 $ 99,324 $ 70,656(1) $ 85,537
Applicable margin.... 11.2% 12.8% 12.9% 12.6% 12.6% 8.9%(1) 10.8%
Income (loss) from
continuing
operations......... $ 40,297 $ 40,685 $ 61,109 $ 53,303 $ 50,094 $ (101,346)(1) $ 45,637(2)
Net income (loss) per
share from
continuing
operations......... $ 0.69 $ 0.70 $ 1.05 $ 0.92 $ 0.87 $ (1.76)(1) $ 0.79(2)
Cash dividends per
common share....... $ 0.27 $ 0.27 $ 0.36 $ 0.36 $ 0.36 $ 0.36 $ 0.34
BALANCE SHEET DATA:
Working capital...... $ 74,795 $ 72,340 $ 43,532 $ 31,766 $ 53,472 $ 47,729
Total assets......... $1,037,192 $1,044,823 $1,009,050 $ 973,444 $ 950,664 $1,006,446
Long-term debt....... $ 246,080 $ 276,954 $ 283,715 $ 284,125 $ 288,633 $ 300,724
Stockholders'
Equity............. $ 495,718 $ 480,290 $ 433,435 $ 396,336 $ 362,664 $ 492,095
Weighted average
common and common
stock equivalents
(000's)............ 58,490 58,078 58,152 57,857 57,741 57,679 57,768
</TABLE>

- ---------------

(1) Includes restructuring and special charges, net of tax benefit, of $136
million ($229 million pre-tax) or $2.36 per share.
(2) Includes $300,000 ($.01 per share) increase in net earnings from cumulative
effect of prior years effect of adopting Statement of Financial Accounting
Standards (SFAS) No. 106 on accounting for post-retirement benefits and SFAS
No. 109 on accounting for income taxes.
(3) Fiscal year 1992 was a fifty-three week year. All other years presented were
fifty-two weeks.
14
<PAGE> 24

LAIDLAW ENVIRONMENTAL AND SAFETY-KLEEN SELECTED UNAUDITED PRO FORMA COMBINED
FINANCIAL INFORMATION

The following selected unaudited pro forma combined financial information
combines the consolidated balance sheets and income statements of Laidlaw
Environmental and Safety-Kleen as if the Offer, the Merger and the other
transactions described herein had occurred for all periods presented. These
statements are prepared on the basis of accounting for the Merger as a purchase
and are based on the assumptions set forth in the notes thereto. These
statements do not reflect the estimated cost savings of approximately $100 to
$130 million Laidlaw Environmental believes will result from the Merger. The
following information is not necessarily indicative of the financial position or
the actual results of operation that would have occurred had the transactions
assumed herein occurred on such dates or of expected future results. This
information should be read in conjunction with and is qualified in its entirety
by the consolidated financial statements and accompanying notes of Laidlaw
Environmental and Safety-Kleen included in the documents described under
"Incorporation of Certain Documents by Reference" (but which, in the case of
Safety-Kleen, are not covered by the reports of Safety-Kleen's independent
accountants for purposes of this Prospectus) and the pro forma combined
financial statements and accompanying discussion and notes set forth under
"Unaudited Pro Forma Combined Financial Information."

<TABLE>
<CAPTION>
PRO FORMA
COMBINED
---------------
YEAR ENDED
AUGUST 31, 1997
---------------
(UNAUDITED)
($ IN
THOUSANDS,
EXCEPT PER
SHARE
AMOUNTS)
<S> <C>
STATEMENT OF INCOME DATA:
Revenue..................................................... $1,655,741
Income (loss) from continuing operations.................... (194,578)
Income (loss) from discontinued operations.................. 20
Net income (loss)........................................... (194,558)
PER SHARE DATA(1):
Income (loss) from continuing operations.................... (0.616)
Income (loss) from discontinued operations.................. .000
Net income (loss)........................................... (0.616)
Weighted average common and common stock equivalents
(000)..................................................... 315,878
</TABLE>

<TABLE>
<CAPTION>
PRO FORMA
COMBINED
---------------
AS OF
AUGUST 31, 1997
---------------
(UNAUDITED)
($ IN
THOUSANDS)
<S> <C>
BALANCE SHEET DATA:
Assets
Total current assets...................................... $ 491,921
Total assets.............................................. 4,475,043
Liabilities
Total current liabilities................................. 412,945
Long term debt............................................ 1,639,615
Subordinated convertible debenture........................ 350,000
Total liabilities......................................... 3,280,084
Stockholders' Equity........................................ 1,194,959
</TABLE>

- ---------------

(1) Assumes an Exchange Ratio of 3.077%.

15
<PAGE> 25

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in "Prospectus Summary," "-- Reasons for the
Offer," "-- Certain Federal Income Tax Consequences," and "-- Background of the
Offer," "-- Reasons for the Offer -- Enhanced Business Opportunities,"
"Background of the Offer," "The Offer -- Certain Federal Income Tax
Consequences," "The Merger -- General," and "Unaudited Pro Forma Combined
Financial Information" including any forecasts, projections and descriptions of
anticipated cost savings and synergies referred to therein, and certain
statements incorporated by reference from documents filed with the Commission by
Laidlaw Environmental and Safety-Kleen, including any statements contained
herein or therein regarding the development or possible assumed future results
of operations of Laidlaw Environmental's and Safety-Kleen's businesses, the
markets for Laidlaw Environmental's and Safety-Kleen's services and products,
anticipated capital expenditures, regulatory developments and the effects of the
Offer and the Merger, any statements preceded by, followed by or that include
the words "believes," "expects," "anticipates," or similar expressions, and
other statements contained or incorporated by reference herein regarding matters
that are not historical facts, are or may constitute forward-looking statements
(as such term is defined in the Private Securities Litigation Reform Act of
1995). Because such statements are subject to risks and uncertainties, actual
results may differ materially from those expressed or implied by such
forward-looking statements. The risks and uncertainties that may cause actual
results to differ include, among others, general economic conditions, risks
associated with acquisitions, fluctuations in operating results because of
acquisitions and variations in stock prices, changes in applicable federal,
state and local laws and regulations, especially environmental regulations,
alternate and emerging technologies, competition and pricing pressures,
overcapacity in the industry, seasonal fluctuations due to weather,
uncertainties of litigation, and risks associated with the operation, growth and
integration of the newly acquired businesses. As a result of these factors,
Laidlaw Environmental's revenue and income could vary significantly from quarter
to quarter, and past financial performance should not be considered a reliable
indicator of future performance. All subsequent written and oral forward-looking
statements attributable to Laidlaw Environmental or persons acting on its behalf
are expressly qualified in their entirety by the cautionary statements set forth
or referred to above in this paragraph. Investors are cautioned not to place
undue reliance on such statements, which speak only as of the date hereof.
Laidlaw Environmental undertakes no obligation to release publicly any revisions
to these forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.

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<PAGE> 26

REASONS FOR THE OFFER

OFFER CONSIDERATION AND PREMIUM

Pursuant to the Offer, each Share will be exchanged for $15.00 net in cash
(subject to adjustment for any Buyout Proposal Expenses paid by Safety-Kleen)
and $15.00 in shares of Laidlaw Environmental Common Stock, assuming that the
Laidlaw Environmental Average Price is not less than $4.28571 nor greater than
$5.35714. Accordingly, the per Share price premium which Safety-Kleen
Shareholders will receive in the Offer will depend on the amount of any Buyout
Proposal Expenses payable by Safety-Kleen and the Laidlaw Common Stock trading
price at the time of consummation of the Offer.

Laidlaw Environmental believes that the Offer is in the best interests of
Safety-Kleen Shareholders because, among other things, the Offer Consideration
represents a 68.4% premium to the per Share closing price on the NYSE on August
7, 1997, the date prior to the announcement of William Blair's retention, a
36.8% premium to the per Share closing price on the NYSE on November 3, 1997,
the last trading day prior to the public announcement of Laidlaw Environmental's
intention to make the Offer and an 11.1% premium to the Buyout Proposal. In
developing its belief that the Offer is in the best interests of Safety-Kleen
Shareholders, Laidlaw Environmental possessed limited information with respect
to the particular circumstances, from a tax standpoint, of individual
Safety-Kleen Shareholders. Laidlaw Environmental therefore cannot make a
conclusive determination as to the tax impact of the Offer and the Merger on all
Safety-Kleen Shareholders. The following table shows the premium of the Offer
Consideration over the per Share closing price on the NYSE on the date prior to
public announcement of William Blair's retention, on the last trading day
immediately prior to the public announcement of the Initial Offer.

<TABLE>
<CAPTION>
OFFER SAFETY-KLEEN PERCENT
PRICE* SHARE PRICE DIFFERENTIAL**
------ ------------ --------------
<S> <C> <C> <C>
August 7, 1997, the date prior to public announcement of
William Blair's retention................................. $30.00 $17.8125 68.4%
November 3, 1997, the last trading day before the public
announcement of Laidlaw Environmental's intention to
acquire Safety-Kleen...................................... $30.00 $21.9375 36.8%
</TABLE>

- ---------------

* Assumes that no Buyout Proposal Expenses are paid and that the Laidlaw
Environmental Average Price is equal to or greater than $4.28571 and less
than or equal to $5.35714.

** Based on the closing price of the Shares on the indicated dates.

ENHANCED BUSINESS OPPORTUNITIES

In addition to the significant premium being offered per Share, Laidlaw
Environmental believes that Safety-Kleen Shareholders will benefit in several
ways as a result of becoming shareholders of Laidlaw Environmental. Upon
consummation of the Offer, Laidlaw Environmental intends to build upon Safety-
Kleen's leading market presence and quality brand equity. In addition, Laidlaw
Environmental's management believes that annual cost savings of approximately
$100 to $130 million would result from the combination of the two companies due
to an anticipated elimination of duplicative general and administrative and
other public company costs, the closure of overlapping service center
facilities, the increased utilization of those facilities that remain open, and
the internalization of various waste streams. Laidlaw Environmental believes
that its acquisition of Safety-Kleen will result in a further strengthening of
Laidlaw Environmental's market position by: (i) providing additional service
center market coverage in key geographic regions including Kentucky, Minnesota,
and New Jersey; (ii) introducing a smaller-sized customer base to complement
Laidlaw Environmental's existing customer base of medium- and large-sized
customers; (iii) allowing for increased vertical integration through the use of
Laidlaw Environmental facilities to process waste streams collected by
Safety-Kleen service centers; and (iv) providing significant expansion into the
solvent recycling market.

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<PAGE> 27

BACKGROUND OF THE OFFER

On August 8, 1997 Safety-Kleen announced the resignation of John G.
Johnson, Jr., President and Chief Executive Officer of Safety-Kleen. Donald W.
Brinckman, Chairman of Safety-Kleen's Board of Directors, who had previously
served as Safety-Kleen's Chief Executive Officer from 1968 until December 31,
1994, was appointed Chief Executive Officer. Safety-Kleen also announced that
its Board of Directors had engaged the services of William Blair to act as
advisor to Safety-Kleen and manage the process of exploring strategic options
for enhancing shareholder value.

On August 8, 1997, William Blair sent a copy of the Safety-Kleen
Confidentiality Letter to one of Laidlaw Environmental's investment bankers, Mr.
David E. Thomas, Jr. of Raymond James & Associates, Inc. and stated that an
offering circular would be available early in the week of August 18, 1997, and
that such circular would be distributed to parties that had executed a
confidentiality agreement. Laidlaw Environmental did not respond to this letter
and William Blair called Laidlaw Environmental's representative and asked that
Laidlaw Environmental sign the confidentiality agreement. Laidlaw Environmental
was willing to sign a confidentiality agreement, but not the one proposed by
Safety-Kleen, which contained a two year standstill provision.

In mid-September 1997, there were further discussions between the two
investment banks in which Laidlaw Environmental's representatives requested a
meeting of the management of the two companies and their advisors so that
Laidlaw Environmental could fully describe why a business combination was in
both companies' best interests. Safety-Kleen's representative continued to
request that Laidlaw Environmental sign the confidentiality agreement containing
the two-year standstill provision. He also stated that if Laidlaw Environmental
would submit its proposal in writing, Safety-Kleen would consider a meeting with
Laidlaw Environmental.

On September 24, 1997, Mr. Thomas of Raymond James, financial advisor to
Laidlaw Environmental, delivered a letter to Mr. Jeffrey W. Corum of William
Blair, informing Mr. Corum of Laidlaw Environmental's interest in pursuing
negotiations with Safety-Kleen. In particular, Mr. Thomas's letter requested a
meeting between management of Laidlaw Environmental and management of
Safety-Kleen and pointed out several unique features of Laidlaw Environmental's
proposed transaction including the potential cost savings available from
combining the operations of Laidlaw Environmental and Safety-Kleen which were
estimated to range from $100 to $130 million annually. Mr. Thomas's letter
suggested structuring the transaction as a reverse merger in which Safety-Kleen
would issue one share of its stock for every three shares of Laidlaw
Environmental stock.

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<PAGE> 28

The text of the September 24 letter is as follows:

Letterhead of Raymond James & Associates, Inc.

September 24, 1997

Mr. Jeffrey W. Corum
William Blair & Company
222 West Adams Street
Chicago, Illinois 60606

Dear Jeff:

As we have discussed, our client, Laidlaw Environmental Services Inc.
("LESI") is interested in pursuing a transaction with Safety-Kleen Corp. ("SK").
We would hope to have a meeting between top management of LESI, Laidlaw, Inc.
and SK to outline our proposed structure and discuss the advantages to SK
shareholders in depth. In anticipation of this meeting we would like to outline
that structure and the benefits.

We propose a reverse merger in which SK would issue one share of its stock
for three shares of LESI stock. The resultant company would have approximately
120 million shares outstanding, approximately half-owned by each of the
precedent company's existing shareholders. Surviving senior management would be
the existing LESI management team, although we would certainly envision that the
best of the combined teams would stay with the combined company.

The key initial advantage of the transaction lies in the tremendous cost
synergies available from combining the operations of SK and LESI. Our estimates
are that these savings could range from $100-$130 million annually. These would
arise from the elimination of duplicate general and administrative and other
public company costs, from the closure of overlapping service center facilities,
from increased utilization of those facilities that remain open, and from the
internalization of various waste streams. Our experience with the merger of
Rollins' and Laidlaw's hazardous waste businesses, in which ultimate realizable
savings will exceed our originally projected $75 million annually (now expected
to be approximately $90 million), gives us a high level of confidence that we
can achieve these synergies.

Your client's board and shareholders should find this to be a very
compelling opportunity. They would have ownership of a company with tremendous
economic opportunity via the increased earnings available from cost savings. Our
estimates show an accretion in SK's EPS from $1.05 to $1.25, which would yield
an additional $4 in value at SK's existing multiple. We believe it likely the
combined companies would trade at an even higher level, reflecting LESI's
multiple or a blend of the LESI and SK multiples. The company would be driven by
a management team with a proven record of achieving similar consolidation
savings and increasing shareholder value, as evidenced by the doubling of LESI's
share price since the date of the Rollins transaction earlier this year.

We would point out several unique features in our proposed transaction that
we believe distinguishes it from other alternatives:

(i) the annual potential savings of $130 million

(ii) the relative ease of completing the transaction based on Laidlaw
Inc.'s ownership position (66 1/2% in LESI);

(iii) the absence of any new funding requirements by the combined
company; and

(iv) the financial strength of the combined balance sheet, cash flow,
and operating margins.

We would like to explore this with you in more detail. We will call you
later today or tomorrow to set up a meeting between our clients.

Sincerely,

David E. Thomas, Jr.
Senior Managing Director
cc: Kenneth W. Winger
James R. Bullock

attachment: Forbes article dated October 6, 1997

19
<PAGE> 29

Shortly thereafter, Mr. Corum responded to Mr. Thomas's letter by telephone
stating that only upon Laidlaw Environmental's delivery of a confidentiality and
standstill agreement acceptable to Safety-Kleen, would Safety-Kleen commence
negotiations with Laidlaw Environmental. Subsequent to their telephone
conversations, Mr. James R. Bullock, Chairman of Laidlaw Environmental,
attempted to call Mr. Brinckman, who did not return his call. Mr. Bullock then
called Mr. E. David Coolidge, III of William Blair in an effort to arrange a
meeting with Safety-Kleen. Mr. Coolidge repeated Safety-Kleen's refusal to meet
with Laidlaw Environmental in the absence of a confidentiality and standstill
agreement.

On November 3, 1997, the Laidlaw Environmental Board of Directors met and
determined to proceed with the Offer as well as to retain Bear Stearns to work
together with Raymond James as financial advisors to Laidlaw Environmental.
Laidlaw Environmental management had previously retained Katten Muchin & Zavis
to serve as legal counsel. Also on November 3, 1997, in a letter to Mr.
Brinckman, Mr. James R. Bullock, Chairman of Laidlaw Environmental, informed Mr.
Brinckman and the Safety-Kleen Board of Directors of Laidlaw Environmental's
intention to pursue the Initial Offer, that Laidlaw Environmental was willing to
execute a confidentiality agreement provided such agreement did not contain a
standstill provision, and that Laidlaw Environmental continued to believe that
annual cost savings and synergies resulting from a combination of the two
companies would exceed $90 million annually. For these and other reasons,
Laidlaw Environmental would consider and pursue various options with respect to
an acquisition of Safety-Kleen notwithstanding Safety-Kleen's refusal to meet
with representatives of Laidlaw Environmental. The letter also informed Mr.
Brinckman that Laidlaw Environmental had executed a commitment letter with
Toronto-Dominion Bank to provide all necessary financing for the Initial Offer
and the Merger and again encouraged Mr. Brinckman and the Safety-Kleen Board to
meet with representatives of Laidlaw Environmental to discuss the possibility of
a mutually beneficial negotiated transaction.

20
<PAGE> 30

The text of Mr. Bullock's November 3 letter is as follows:

LETTERHEAD FOR JAMES R. BULLOCK

November 3, 1997
Mr. Donald W. Brinckman
Chairman & Chief Executive Officer
Safety-Kleen Corp.
900 North Randall Road
Elgin, Illinois
USA 60123

Dear Mr. Brinckman:

I am writing to you in my capacity as Chairman of Laidlaw Environmental
Services, Inc. Since your August 8th announcement that you would explore
strategic alternative to enhance shareholder value, we have sought
unsuccessfully, directly through phone calls to you and indirectly through your
advisors, to meet with you to pursue the combination of our companies. Six weeks
ago, at the request of your financial advisor, we submitted a preliminary merger
proposal to which you have yet to respond. Needless to say, we are frustrated by
your continuing unwillingness to engage in constructive dialogue.

As you are aware, your advisors have insisted that we sign an agreement that
would permit us to propose strategic alternatives that maximize value for your
shareholders only if you "shall have requested in writing in advance the
submission of such proposal". We have made clear on numerous occasions our
willingness to sign a confidentiality agreement that protects nonpublic
information you choose to share with us. In light of our experience to date,
however, we will not sign any agreement that does not ensure that your
shareholders have the opportunity to consider our offer and to maximize the
value of their stock.

In response to your continuing unwillingness to meet or commence discussions
with us in a meaningful way, our Board of Directors today authorized and
directed senior management of Laidlaw Environmental Services, Inc. to pursue the
acquisition of Safety-Kleen Corp. We have executed commitment letters with the
Toronto-Dominion Bank to provide all the necessary financing for this
acquisition. We have engaged Bear Stearns & Co., Inc. and Raymond James and
Associates Inc. to serve as our financial advisors and Katten Muchin and Zavis
to serve as our legal counsel.

Our offer for each share of Safety-Kleen Corp. is a combination of $14.00 in
cash and 2.4 common shares of Laidlaw Environmental Services, Inc. stock. This
represents approximately an 18.2% premium to Safety-Kleen's closing price on
Friday and a 46% premium to Safety-Kleen's trading price prior to your August
8th announcement. Please note that our offer is not subject to due diligence or
a financing contingency. We have fully committed financing sufficient to
complete the combination. We believe our offer represents a full and fair price
based on the publicly available information we have reviewed. However, should
you be willing to meet with us, we are prepared to consider any additional
information you may wish to provide that demonstrates that a higher valuation is
warranted. We continue to prefer a negotiated transaction.

Together our companies can create greater shareholder value than can either
of us alone. We estimate annual cost savings and synergy's will exceed $90
million. We believe the stock market will embrace this transaction and will
reward the combined company with enhanced stock performance. Our offer ensures
your shareholders participate in this exciting future.

We believe it is in the best interests of our companies to proceed
immediately to negotiate a definitive agreement, containing customary public
company terms and conditions, and to consummate a transaction by year-end. Given
the importance we place on this combination, we are prepared to commit the
resources necessary to see its timely completion. We and our advisors would be
pleased to meet you and your advisors in Chicago either later today or tomorrow
to complete the necessary papers.

In recognition of the strategic nature and compelling financial benefits of
our proposed combination to your shareholders and our willingness to consider
modifications to our offer as warranted, we expect you not to enter into any
binding merger or similar agreement with any other party without first exploring
with us the full merits of combining our two companies.

Our Board of Directors unanimously supports this merger. We trust you and
the other members of Safety-Kleen's Board of Directors will consider the best
interests of Safety-Kleen's shareholders and will agree to meet with us promptly
to achieve a mutually beneficial transaction.

We look forward to hearing from you later today.
Sincerely,

James R. Bullock, Chairman
cc: Safety-Kleen, Board of Directors
Laidlaw Environmental Services, Inc., Board of Directors
Douglas T. Lake, Bear Stearns & Co. Inc.
David E. Thomas, Jr., Raymond James & Associates Inc.

Herbert S. Wander, Katten Muchin & Zavis

William Blair & Company, LLC

21
<PAGE> 31

On November 3, 1997 after receipt of Mr. Bullock's letter, Mr. Brinckman
delivered a letter to Mr. Bullock requesting that Laidlaw Environmental execute
a confidentiality and standstill agreement and informing Mr. Bullock that the
Board of Directors of Safety-Kleen would fully consider Laidlaw Environmental's
proposal along with other proposals received by Safety-Kleen. In addition, Mr.
Brinckman stated that representatives of Safety-Kleen, together with its
financial advisors, would meet with representatives of Laidlaw Environmental,
together with its financial advisors, to discuss information concerning Laidlaw
Environmental and the estimated cost savings and synergies.

The text of Mr. Brinckman's November 3 letter is as follows:

November 3, 1997
VIA FACSIMILE

Mr. James R. Bullock
Chairman
Laidlaw Environmental Services, Inc.
3221 North Service Road
P.O. Box 5028
Burlington, Ontario
Canada L7R 3Y8

Dear Mr. Bullock:

Thank you for your letter of November 3, 1997.

As you know, we are engaged in a process of exploring strategic
alternatives for enhancing shareholder value. That process includes a possible
sale of the Company. Every prospective purchaser engaged in that phase of the
process has signed a confidentiality and standstill agreement that is designed
to produce even-handed treatment of participants. We urge you -- as we have
previously -- to sign that agreement and participate in this process on the same
basis as each of the other potential bidders.

In any event, our Board of Directors will fully consider your proposal
along with others that we receive. For purposes of furthering our understanding
and evaluation of your proposal, our financial advisors, William Blair &
Company, together with representatives of the Company, would be pleased to meet
with you in Chicago at a mutually convenient time so that you can furnish us
with information concerning Laidlaw Environmental Services and your estimated
cost savings and synergies. Please call John Carton of William Blair
(312/364-8426) to arrange for this meeting. In addition, if you execute our
confidentiality and standstill agreement accepting the same ground rules as our
other potential bidders, arrangements will be made to promptly provide you with
non-public information concerning the Company.

We appreciate your interest in Safety-Kleen and look forward to hearing
from you.

Sincerely,

Donald W. Brinckman

DWB/mb

On November 4, 1997, Laidlaw Environmental publicly announced its intention
to pursue the Initial Offer and the Merger.

On November 5, 1997, Mr. Bullock and a representative of Bear Stearns met
with Mr. Brinckman, Mr. Joseph Chalhaub, Senior Vice President of Safety-Kleen,
and representatives of William Blair to discuss

22
<PAGE> 32

potential synergies that could be achieved through a combination of the two
companies and ways the parties could work together. Mr. Bullock stated that
Laidlaw Environmental was prepared to sign a mutual confidentiality agreement
that would not contain a standstill provision so that Laidlaw Environmental and
Safety-Kleen could share information with each other. In response, Safety-Kleen
repeated its requirement that Laidlaw Environmental sign a confidentiality and
standstill agreement.

Subsequent to the November 5th meeting, the representatives of the parties
exchanged correspondence reiterating their positions with respect to the
confidentiality and standstill agreement.

The text of the November 13 letter is as follows:

November 13, 1997

Mr. Donald W. Brinckman

Chairman & Chief Executive Officer

Safety-Kleen Corp.

1000 North Randall Road

Elgin, Illinois

USA 60123

Dear Mr. Brinckman:

We continue to be frustrated at the lack of progress in engaging in
substantive dialogue with you due to your continuing insistence that we sign a
standstill agreement. We believe our offer of $14.00 in cash and 2.4 shares of
Laidlaw Environmental Services, Inc. common stock represents outstanding value
for your shareholders.

The combination of our two companies is of compelling strategic importance
to both our shareholders. We have repeatedly sought to work with you in a
cooperative manner to achieve a mutually beneficial transaction. Unfortunately,
our efforts have come to naught.

As we discussed in Chicago, under the securities laws we are required to
file a registration statement relating to our offer with the Securities and
Exchange Commission. We took that step today. As a courtesy, we are enclosing a
copy of these materials for you. As soon as we are permitted to so, we will make
our offer directly to Safety-Kleen Corp. shareholders. We strongly believe that
Safety-Kleen Corp. shareholders, the owners of the company to whom your Board
owes fiduciary duties, are the ones who should ultimately decide whether our
offer and the strategic benefits the combination promises are as compelling to
them as they are to us.

As you will appreciate, in order for Safety-Kleen Corp. shareholders to
accept our offer, we must be assured that all antitakeover devices put in place
by your Board or otherwise applicable under Wisconsin law will not apply to our
offer. Accordingly, we hereby request that your Board amend your poison pill to
make it inapplicable to an acquisition of Safety-Kleen Corp. shares pursuant to
our offer, approve our acquisition of Safety-Kleen Corp. shares pursuant to our
offer for purposes of Section 180.1141 of the Wisconsin Statutes and take or
agree to take any other action necessary or appropriate to eliminate all
antitakeover devices.

In addition, we are furnishing you with the resolution and notice
contemplated by Section 180.1150(4) of the Wisconsin Statutes. We request that,
as required by statute, your Board call a special meeting of Safety-Kleen Corp.
shareholders to vote on the resolution and that such meeting be held no sooner
than 30 nor later than 50 days from the date hereof. In this connection, we are
enclosing a request that you furnish us with a list

23
<PAGE> 33

of Safety-Kleen Corp. shareholders so that we can communicate with them directly
and solicit proxies for the special meeting.

We do not take these actions lightly. Your failure to work with us leaves
us no alternative. We remain hopeful your board, after due consideration, will
determine to engage us in negotiations that lead to a mutually beneficial merger
of our two outstanding companies.

Yours very truly

James R. Bullock

Chairman

On November 13, 1997, Laidlaw Environmental also sent a notice to
Safety-Kleen pursuant to Section 180.1150 of the Wisconsin Statutes requesting
that the Safety-Kleen Board of Directors convene a special meeting of
shareholders and submit for shareholder approval a resolution to restore regular
voting power to any Shares Laidlaw Environmental acquires as a result of the
Offer. See "The Offer -- Conditions of the Offer -- Wisconsin Statutory
Condition."

By a second letter dated November 13, 1997, Laidlaw Environmental, having
in its judgment complied with the Wisconsin Statutes, requested the right to
inspect and copy the Safety-Kleen Shareholder list for the purpose of
communicating directly with the Safety-Kleen Shareholders. See "-- Litigation."

On November 20, 1997, Safety-Kleen announced that it had entered into the
Buyout Merger Agreement with the Buyout Group. Pursuant to the Buyout Merger
Agreement, an acquisition subsidiary formed by the Buyout Group would merge with
and into Safety-Kleen (the "Buyout Merger"), with Safety-Kleen as the surviving
company, in a transaction in which Safety-Kleen Shareholders would receive
$27.00 per Share in cash. As a result of the Buyout Merger, Safety-Kleen would
become a wholly-owned subsidiary of a new holding company formed by the Buyout
Group and would continue to operate under its current management out of its
current headquarters. The closing of the Buyout Merger is subject to certain
conditions, including the approval of at least 66 2/3% of Safety-Kleen's
Shareholders and both the debt and equity funding of the financing arrangements
of the Buyout Group. Pursuant to the Buyout Merger Agreement, Safety-Kleen is
required to pay a termination fee of $50 million and to reimburse the Buyout
Group for its expenses in an amount up to $25 million under certain conditions,
including in the event that the Buyout Merger Agreement is terminated and the
Offer by Laidlaw Environmental is accepted by the Safety-Kleen Shareholders.

24
<PAGE> 34

The text of the November 20 letter is as follows:

November 20, 1997

Mr. Donald W. Brinckman

Chairman of the Board

Safety-Kleen Corp.

1000 North Randall Road

Elgin, Illinois 60123

Dear Mr. Brinckman:

Your announcement this morning resolves any ambiguity on the issue of
whether the Safety-Kleen Board of Directors recognizes that the best route to
maximizing shareholder value is through the sale of the company. Under these
circumstances it is equally apparent the Safety-Kleen Board has a fiduciary duty
to act as a responsible auctioneer.

I am writing to advise that we are increasing our offer to acquire
Safety-Kleen to $30.00 per share consisting of $15.00 cash and $15.00 in Laidlaw
Environmental common stock. The cash portion will be reduced by any incremental
costs, such as break-up fees, new severance arrangements and other expenses,
Safety-Kleen may have incurred in connection with its agreement with Philip
Services and others. We presume these costs are insignificant given your
fiduciary duties to Safety-Kleen shareholders, our long standing offer to
negotiate all aspects of our proposal including price and the lack of any
mention of these costs in your public announcement. The exchange ratio of the
stock portion of our offer will be between 2.8 and 3.5 shares based on the
weighted average trading price for Laidlaw Environmental shares for 10 days
selected by lot from the 20 trading days ending three business days immediately
prior to closing.

Our offer ensures Safety-Kleen shareholders will have the opportunity to
share directly in the value this combination creates. In addition, the stock
portion of our offer can be delivered to Safety-Kleen shareholders on a tax
deferred basis with the value of our shares protected by the collar.

Although I remain puzzled by your lack of interest in our offers to date,
clearly with the terms now embodied in this letter it is time for us to put
behind us the posturing over standstill agreements or litigation on procedural
issues. We trust you and the other members of Safety-Kleen's Board of Directors
will consider the best interests of Safety-Kleen shareholders and agree to meet
with us immediately to negotiate a definitive agreement. We reiterate our
willingness to enter into a mutual confidentiality agreement to facilitate
negotiations.

As time is of the essence, may we hear from you promptly.

Yours very truly,

Laidlaw Environmental Services, Inc.

James R. Bullock

Chairman of the Board

25
<PAGE> 35

LITIGATION

Claims Filed by Safety-Kleen. On November 17, 1997, Safety-Kleen commenced
litigation in the United States District Court for the Northern District of
Illinois alleging that Laidlaw Environmental violated Section 5(b)(1) of the
Securities Act of 1933 by making a "premature offer" and unlawful proxy
solicitation. As a remedy for that alleged violation, Safety-Kleen requests that
it be relieved of its obligation to provide Laidlaw Environmental with its list
of shareholders so that Safety-Kleen will not be in a position of facilitating a
violation of the federal securities laws. The Safety-Kleen Complaint further
alleges that Laidlaw Environmental's request that Safety-Kleen call a special
meeting of its shareholders fails to comply with the state law notice
requirements. Safety-Kleen contends that the notice served by Laidlaw
Environmental fails to provide sufficient disclosure of the financing to be used
in connection with its Offer. Safety-Kleen seeks declaratory judgment that it
need not schedule the special meeting or provide access to its shareholder list.

Claims Filed by Laidlaw Environmental. On November 24, 1997, Laidlaw
Environmental filed its answer to the Safety-Kleen Complaint in which Laidlaw
Environmental denied each of Safety-Kleen's claims and raised certain
affirmative defenses. On that date, Laidlaw Environmental also filed a
counterclaim against Safety-Kleen and each member of its board of directors (the
"Director Defendants") seeking, among other things: (i) an order compelling
Safety-Kleen to call a special shareholders' meeting to vote on the resolution
proposed by Laidlaw Environmental in accordance with Wis. Stat sec. 1150(5)(a)
to restore full voting rights to any Shares acquired by Laidlaw Environmental in
the Offer and the Merger; (ii) an order compelling the production of
Safety-Kleen's shareholder lists, to be produced promptly and at Safety-Kleen's
expense; (iii) an order (w) declaring that the Director Defendants have breached
their fiduciary duties to Safety-Kleen's shareholders, including Laidlaw
Environmental, by refusing to negotiate with Laidlaw Environmental, entering
into the Buyout Transaction, and agreeing to the unlawful provisions of the
merger agreement, including the break-up fee, (x) compelling the Director
Defendants to carry out their fiduciary duties to Safety-Kleen's shareholders,
including Laidlaw Environmental, by implementing and adhering to procedures
under which the transaction providing the best value reasonably available can be
obtained for Safety-Kleen's shareholders, (y) enjoining Safety-Kleen and the
Director Defendants from proceeding with the Buyout Transaction or paying a
"break-up fee" to the Buyout Group, and (z) directing the Director Defendants to
negotiate with Laidlaw Environmental regarding the Offer; (iv) an order
compelling the Director Defendants to amend the Rights Plan to make it
inapplicable to the New Offer or to redeem the rights; (v) an order (pursuant to
the derivative claim) requiring the Director Defendants to account to
Safety-Kleen for waste of corporate assets and all other damages caused by their
approval of the Buyout Transaction; and (vi) an award of costs of suit and
reasonable attorneys' fees, and for such other relief as the Court may deem just
and appropriate.

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<PAGE> 36

THE OFFER

GENERAL

Laidlaw Environmental hereby offers, upon the terms and subject to the
conditions set forth herein and in the related Letter of Transmittal, to
exchange the Offer Consideration for each outstanding Share validly tendered on
or prior to the Expiration Date and not properly withdrawn. The Offer
Consideration per Share (and accompanying Rights) consists of $15.00 net in cash
(subject to adjustment as described below) and that number of shares of Laidlaw
Environmental Common Stock equal to the Exchange Ratio. Laidlaw Environmental
Common Stock is listed for trading under the symbol "LLE" on the NYSE. On
, 1997, the closing price of Laidlaw Environmental Common Stock on
the NYSE was $ . Based on such closing price, the Exchange Ratio would
be , and each Share would be converted into $15.00 net in cash (subject
to adjustment as described below) and shares of Laidlaw Environmental
Common Stock. The Exchange Ratio will change as the market price of the Laidlaw
Environmental Common Stock changes. Holders of outstanding Shares ("Safety-Kleen
Shareholders") may call (800) - any time on or after the date hereof
through the Expiration Date for the current Exchange Ratio calculated for
purposes of responding to telephone inquiries based on the average of the
closing prices of Laidlaw Environmental Common Stock for the ten consecutive
Trading Days preceding the date the call is placed. The actual Laidlaw
Environmental Average Price and Exchange Ratio will be calculated as of the
third Trading Day immediately prior to the Expiration Date, as described above,
and a press release will be issued announcing the actual Exchange Ratio prior to
the opening of the second Trading Day prior to the Expiration Date (as it may be
extended from time to time). Based on such closing price, each Share would be
converted into $15.00 net in cash and Laidlaw Environmental Common Stock having
a market value of $15.00. The value of the Offer Consideration will fluctuate as
the market price of the Laidlaw Common Stock changes.

Tendering shareholders will not be obligated to pay any charges or expenses
of the Exchange Agent or any brokerage commissions. Except as set forth in the
Instructions to the Letter of Transmittal, transfer taxes on the exchange of
Shares pursuant to the Offer will be paid by or on behalf of Laidlaw
Environmental.

The purpose of the Offer is to enable Laidlaw Environmental to obtain
control of, and ultimately the entire common equity interest in, Safety-Kleen.
Laidlaw Environmental presently intends, as soon as practicable after
consummation of the Offer, to propose and seek to have Safety-Kleen effect the
Merger. In the Merger, each outstanding Share (other than Shares owned by
Laidlaw Environmental or any of its affiliates, Shares held in the treasury of
Safety-Kleen (if Safety-Kleen is so authorized) or by any subsidiary of
Safety-Kleen and Shares owned by Safety-Kleen Shareholders who perfect appraisal
rights under Wisconsin law) would be cancelled in exchange for the right to
receive the Offer Consideration. See "The Merger."

In the event that Laidlaw Environmental obtains all of the Shares pursuant
to the Offer and/or the Merger, former holders of Shares (other than Laidlaw
Environmental) would own approximately 43.4% of the outstanding shares of
Laidlaw Environmental Common Stock, based on the number of shares of Laidlaw
Environmental Common Stock outstanding on October 14, 1997.

Laidlaw Environmental's obligation to exchange the Offer Consideration for
Shares pursuant to the Offer is subject to satisfaction or waiver of the Minimum
Tender Condition, the Laidlaw Environmental Stockholder Approval Condition, the
Rights Plan Condition, the Wisconsin Statutory Condition, the Buyout Expense
Condition and the Regulatory Approval Condition (in each case as defined on the
cover page of this Prospectus) and the other conditions set forth under
"-- Conditions of the Offer."

According to the Safety-Kleen September 6, 1997 Form 10-Q, as of September
6, 1997, there were 58,400,729 Shares outstanding. As of November 18, 1997,
Laidlaw Environmental beneficially owned 601,100 Shares, or approximately 1.03%
of the outstanding Shares.

Requests have been made to Safety-Kleen for the use of Safety-Kleen's
shareholder lists and security position listings for the purpose of
communicating with Safety-Kleen Shareholders and disseminating the Offer to
holders of Shares. This Prospectus and the related Letter of Transmittal and
other relevant materials will be mailed to registered holders of Shares and will
be furnished to brokers, dealers, commercial banks,

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<PAGE> 37

trust companies and similar persons whose names, or the names of whose nominees,
appear on such shareholder lists, or, if applicable, who are listed as
participants in a clearing agency's security position listing for subsequent
transmittal to beneficial owners of Shares by Laidlaw Environmental following
receipt of such list or listings from Safety-Kleen.

THE CASH CONSIDERATION

THE EXCHANGE RATIO

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<PAGE> 38

announcing the actual Exchange Ratio prior to the opening of the second Trading
Day prior to the Expiration Date (as it may be extended from time to time).

SAFETY-KLEEN RIGHTS

No separate payment will be made by Laidlaw Environmental for the Rights
pursuant to the Offer. The Rights are presently evidenced by the certificates
for the Shares, and the tender by a Safety-Kleen Shareholder of his or her
Shares prior to the Distribution Date (as defined below) will also constitute a
tender of the associated Rights. Upon the earlier to occur of (i) 10 days
following a public announcement that a person has acquired beneficial ownership
of 20% or more of the outstanding Shares (an "Acquiring Person") or (ii) 10
business days (or such later date as may be determined by action of the
Safety-Kleen Board prior to such time as any person or group becomes an
Acquiring Person) following the commencement of, or announcement of an intention
to make, a tender offer or exchange offer which would result in the person
making the offer becoming an Acquiring Person (the earlier of such dates being
called the "Distribution Date"), separate certificates evidencing the Rights
will be mailed to holders of record of the Shares as of the close of business on
the Distribution Date and such separate Rights certificates alone will evidence
the Rights.

If the Distribution Date occurs and separate certificates representing the
Rights are distributed by Safety-Kleen or the Rights Agent to holders of Shares
prior to the time a holder's Shares are tendered pursuant to the Offer,
certificates representing a number of Rights equal to the number of Shares
tendered must be delivered to the Exchange Agent, or, if available, a book-entry
confirmation received by the Exchange Agent with respect thereto, in order for
such Shares to be validly tendered. If a Distribution Date occurs and separate
certificates representing the Rights are not distributed prior to the time
Shares are tendered pursuant to the Offer, Rights may be tendered prior to a
Safety-Kleen Shareholder receiving the certificates for Rights by use of the
guaranteed delivery procedure described under "-- Procedure for Tendering"
below.

In connection with the Buyout Merger Agreement, the Board of Directors of
Safety-Kleen approved a Second Amendment to the Rights Agreement, dated as of
November 20, 1997 (the "Second Amendment"). The Second Amendment provides, among
other things, that the execution, delivery and performance of the Merger
Agreement will not (i) cause Parent, Purchaser or any of their respective
Affiliates or Associates to become an "Acquiring Person" (as defined in the
Rights Agreement), (ii) give rise to a "Distribution Date" (as defined in the
Rights Agreement) or (iii) trigger certain other events specified in the Rights
Agreement.

TIMING OF THE OFFER

The Offer is currently scheduled to expire on , 1997; however,
it is Laidlaw Environmental's current intention to extend the Offer from time to
time as necessary until all conditions to the Offer have been satisfied or
waived. See "-- Extension, Termination and Amendment." Laidlaw Environmental has
received a commitment letter from Toronto-Dominion Bank stating that it will
provide or arrange credit facilities in the amount necessary to fund payment of
the Cash Consideration. See "-- Source and Amount of Funds." In the unlikely
event that Laidlaw Environmental has not obtained financing for the Cash
Consideration prior to five business days before the Expiration Date, Laidlaw
Environmental currently intends to extend the Offer to ensure that five business
days remain for Safety-Kleen Shareholders to tender their Shares in the Offer
subsequent to obtaining financing. See "-- Source and Amount of Funds." Laidlaw
Environmental expects that the Laidlaw Environmental Stockholder Approval
Condition will be satisfied on or about , 1997, the date on which it
plans to call the Laidlaw Environmental Special Meeting, to approve the issuance
of shares of Laidlaw Environmental Common Stock in connection with the Offer and
the Merger.

EXTENSION, TERMINATION AND AMENDMENT

Laidlaw Environmental expressly reserves the right (but will not be
obligated), in its sole discretion, at any time or from time to time, and
regardless of whether any of the events set forth in "-- Conditions of the
Offer" shall have occurred or shall have been determined by Laidlaw
Environmental to have occurred, to extend the period of time during which the
Offer is to remain open by giving oral or written notice of such extension to
the Exchange Agent, which extension will be announced no later than 9:00 a.m.,
New York City

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<PAGE> 39

time, on the next business day after the previously scheduled Expiration Date.
There can be no assurance that Laidlaw Environmental will exercise its right to
extend the Offer. However, it is Laidlaw Environmental's current intention to
extend the Offer until all Offer Conditions have been satisfied or waived.
During any such extension, all Shares previously tendered and not withdrawn will
remain subject to the Offer, subject to the right of a tendering Safety-Kleen
Shareholder to withdraw his or her Shares. See "-- Withdrawal Rights."

Subject to the applicable rules and regulations of the Commission, Laidlaw
Environmental also reserves the right, in its sole discretion, at any time or
from time to time, (i) to delay acceptance for, exchange of, or, regardless of
whether such Shares (and Rights, if applicable) were theretofore accepted for
exchange, exchange of any Shares (and Rights, if applicable) pursuant to the
Offer, or to terminate the Offer and not accept for exchange or exchange any
Shares (and Rights, if applicable) not theretofore accepted for exchange, or
exchanged, upon the failure of any of the conditions of the Offer to be
satisfied and (ii) to waive any condition (other than the Laidlaw Environmental
Stockholder Approval Condition, the Regulatory Approval Condition and the
condition relating to the effectiveness of the Registration Statement) or
otherwise amend the Offer in any respect, by giving oral or written notice of
such delay, termination or amendment to the Exchange Agent and by making a
public announcement thereof. Any such extension, termination, amendment or delay
will be followed as promptly as practicable by public announcement thereof, such
announcement in the case of an extension to be issued no later than 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
Expiration Date. Subject to applicable law (including Rules 14d-4(c) and
14d-6(d) under the Exchange Act, which require that any material change in the
information published, sent or given to Safety-Kleen Shareholders in connection
with the Offer be promptly disseminated to Safety-Kleen Shareholders in a manner
reasonably designed to inform Safety-Kleen Shareholders of such change) and
without limiting the manner in which Laidlaw Environmental may choose to make
any public announcement, Laidlaw Environmental shall have no obligation to
publish, advertise or otherwise communicate any such public announcement other
than by making a release to the Dow Jones News Service.

Laidlaw Environmental confirms that if it makes a material change in the
terms of the Offer or the information concerning the Offer, or if it waives a
material condition of the Offer, Laidlaw Environmental will extend the Offer to
the extent required under the Exchange Act. If, prior to the Expiration Date,
Laidlaw Environmental shall increase or decrease the percentage of Shares being
sought or the consideration offered to holders of Shares, such increase or
decrease shall be applicable to all holders whose Shares are accepted for
exchange pursuant to the Offer, and, if at the time notice of any such increase
or decrease is first published, sent or given to holders of Shares, the Offer is
scheduled to expire at any time earlier than the tenth business day from and
including the date that such notice is first so published, sent or given, the
Offer will be extended until the expiration of such ten business day period. For
purposes of the Offer, a "business day" means any day other than a Saturday,
Sunday or a federal holiday and consists of the time period from 12:01 a.m.
through 12:00 midnight, New York City time.

EXCHANGE OF SHARES; DELIVERY OF OFFER CONSIDERATION

Upon the terms and subject to the conditions of the Offer (including, if
the Offer is extended or amended, the terms and conditions of any such extension
or amendment), Laidlaw Environmental will accept for exchange, and will
exchange, Shares (and Rights, if applicable) validly tendered and not properly
withdrawn as promptly as practicable following the Expiration Date. In addition,
subject to applicable rules of the Commission, Laidlaw Environmental expressly
reserves the right to delay acceptance of or the exchange of Shares (and Rights,
if applicable) in order to comply with any applicable law. In all cases,
exchange of Shares (and Rights, if applicable) tendered and accepted for
exchange pursuant to the Offer will be made only after receipt by the Exchange
Agent of certificates for such Shares (and Rights, if applicable) (or a
confirmation of a book-entry transfer of such Shares (and Rights, if applicable)
in the Exchange Agent's account at The Depository Trust Company (the "Book-Entry
Transfer Facility")), a properly completed and duly executed Letter of
Transmittal (or facsimile thereof) and any other required documents.

For purposes of the Offer, Laidlaw Environmental will be deemed to have
accepted for exchange Shares (and Rights, if applicable) validly tendered and
not withdrawn as, if and when Laidlaw Environmental gives oral or written notice
to the Exchange Agent of its acceptance of the tenders of such Shares (and
Rights, if

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<PAGE> 40

applicable) pursuant to the Offer. Delivery of Laidlaw Environmental Common
Stock and Cash Consideration in exchange for Shares (and Rights, if applicable)
pursuant to the Offer and cash in lieu of fractional shares of Laidlaw
Environmental Common Stock will be made by the Exchange Agent as soon as
practicable after receipt of such notice. The Exchange Agent will act as agent
for tendering Safety-Kleen Shareholders for the purpose of receiving Laidlaw
Environmental Common Stock, the Cash Consideration and cash to be paid in lieu
of fractional shares of Laidlaw Environmental Common Stock from Laidlaw
Environmental and transmitting such Laidlaw Environmental Common Stock and cash
to tendering Safety-Kleen Shareholders. Under no circumstances will interest be
paid by Laidlaw Environmental by reason of any delay in making such exchange.

If any tendered Shares are not accepted for exchange pursuant to the terms
and conditions of the Offer for any reason, or if certificates are submitted for
more Shares than are tendered, certificates for such unexchanged Shares will be
returned without expense to the tendering Safety-Kleen Shareholder or, in the
case of Shares tendered by book-entry transfer of such Shares into the Exchange
Agent's account at a Book-Entry Transfer Facility pursuant to the procedures set
forth below under "-- Procedure for Tendering," such Shares will be credited to
an account maintained within such Book-Entry Transfer Facility as soon as
practicable following expiration or termination of the Offer.

CASH IN LIEU OF FRACTIONAL SHARES OF LAIDLAW ENVIRONMENTAL COMMON STOCK

No certificates representing fractional shares of Laidlaw Environmental
Common Stock will be issued pursuant to the Offer. In lieu thereof, each
tendering shareholder who would otherwise be entitled to a fractional share of
Laidlaw Environmental Common Stock will receive cash in an amount equal to such
fraction (expressed as a decimal and rounded to the nearest 0.01 of a share)
times the closing price for shares of Laidlaw Environmental Common Stock on the
NYSE Composite Tape on the date such Safety-Kleen Shareholder's Shares are
accepted for exchange by Laidlaw Environmental.

WITHDRAWAL RIGHTS

Tenders of Shares (and Rights, if applicable) made pursuant to the Offer
are irrevocable, except that Shares (and Rights, if applicable) tendered
pursuant to the Offer may be withdrawn pursuant to the procedures set forth
below at any time prior to the Expiration Date, and, unless theretofore accepted
for exchange and exchanged by Laidlaw Environmental for the Offer Consideration
pursuant to the Offer, may also be withdrawn at any time after .

For a withdrawal to be effective, a written or facsimile transmission
notice of withdrawal must be timely received by the Exchange Agent at one of its
addresses set forth on the back cover of this Prospectus, and must specify the
name of the person having tendered the Shares (and Rights, if applicable) to be
withdrawn, the number of Shares (and Rights, if applicable) to be withdrawn and
the name of the registered holder, if different from that of the person who
tendered such Shares (and Rights, if applicable).

The signature(s) on the notice of withdrawal must be guaranteed by a
financial institution (including most banks, savings and loan associations and
brokerage houses) which is a participant in the Securities Transfer Agents
Medallion Program, the New York Stock Exchange Medallion Signature Program or
the Stock Exchange Medallion Program (an "Eligible Institution") unless such
Shares (and Rights, if applicable) have been tendered for the account of any
Eligible Institution. If Shares (and Rights, if applicable) have been tendered
pursuant to the procedures for book-entry tender as set forth below under
"-- Procedure for Tendering," any notice of withdrawal must specify the name and
number of the account at the Book-Entry Transfer Facility to be credited with
the withdrawn Shares (and Rights, if applicable) and must otherwise comply with
such Book-Entry Transfer Facility's procedures. If certificates have been
delivered or otherwise identified to the Exchange Agent, the name of the
registered holder and the serial numbers of the particular certificates
evidencing the Shares (and Rights, if applicable) withdrawn must also be
furnished to the Exchange Agent as aforesaid prior to the physical release of
such certificates.

All questions as to the form and validity (including time of receipt) of
any notice of withdrawal will be determined by Laidlaw Environmental, in its
sole discretion, which determination shall be final and binding.

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<PAGE> 41

Neither Laidlaw Environmental, the Exchange Agent, the Information Agent, the
Dealer Manager nor any other person will be under any duty to give notification
of any defects or irregularities in any notice of withdrawal or will incur any
liability for failure to give any such notification. Any Shares (and Rights, if
applicable) properly withdrawn will be deemed not to have been validly tendered
for purposes of the Offer. However, withdrawn Shares (and Rights, if applicable)
may be retendered by following one of the procedures described under
"-- Procedure for Tendering" at any time prior to the Expiration Date.

A withdrawal of Shares shall also constitute a withdrawal of the associated
Rights. Rights may not be withdrawn unless the associated Shares are also
withdrawn.

PROCEDURE FOR TENDERING

For a Safety-Kleen Shareholder to validly tender Shares (and Rights, if
applicable) pursuant to the Offer, (i) a properly completed and duly executed
Letter of Transmittal (or manually executed facsimile thereof), together with
any required signature guarantees, or an Agent's Message (as defined below) in
connection with a book-entry transfer, and any other required documents, must be
transmitted to and received by the Exchange Agent at one of its addresses set
forth on the back cover of this Prospectus and either certificates for tendered
Shares (and Rights, if applicable) must be received by the Exchange Agent at
such address or such Shares (and Rights, if applicable) must be tendered
pursuant to the procedures for book-entry transfer set forth below (and a
confirmation of receipt of such tender received (such confirmation, a "Book-
Entry Confirmation")), in each case prior to the Expiration Date, or (ii) such
Safety-Kleen Shareholder must comply with the guaranteed delivery procedure set
forth below.

The term "Agent's Message" means a message, transmitted by a Book-Entry
Transfer Facility to, and received by, the Exchange Agent, and forming a part of
a Book-Entry Confirmation, which states that such Book-Entry Transfer Facility
has received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Shares (and Rights, if applicable) that such
participant has received and agrees to be bound by the terms of the Letter of
Transmittal and that Laidlaw Environmental may enforce such agreement against
such participant.

Safety-Kleen Shareholders will be required to tender one Right for each
Share tendered in order to effect a valid tender of Shares, unless the Rights
Plan Condition has been satisfied or waived. Unless the Safety-Kleen
Distribution Date occurs, a tender of Shares will constitute a tender of the
associated Rights. If the Safety-Kleen Distribution Date occurs and separate
certificates representing the Rights are distributed by Safety-Kleen or the
Rights Agent to holders of Shares prior to the time a holder's Shares are
tendered pursuant to the Offer, certificates representing a number of Rights
equal to the number of Shares tendered must be delivered to the Exchange Agent,
or, if available, a Book-Entry Confirmation received by the Exchange Agent with
respect thereto, in order for such Shares to be validly tendered. If the
Safety-Kleen Distribution Date occurs and separate certificates representing the
Rights are not distributed prior to the time Shares are tendered pursuant to the
Offer, Rights may be tendered prior to a shareholder receiving the certificates
for Rights by use of the guaranteed delivery procedure described below. If
Rights certificates are distributed but are not available to a shareholder prior
to the time Shares are tendered pursuant to the Offer, a tender of Shares
constitutes an agreement by the tendering shareholder to deliver to the Exchange
Agent pursuant to the guaranteed delivery procedure described below, prior to
the expiration of the period to be specified in the Notice of Guaranteed
Delivery and the related Letter of Transmittal for delivery of Rights
certificates or a Book-Entry Confirmation for Rights (the "Rights Delivery
Period"), Rights certificates representing a number of Rights equal to the
number of Shares tendered. Laidlaw Environmental reserves the right to require
that it receive such Rights certificates (or a Book-Entry Confirmation with
respect to such Rights) prior to accepting Shares for exchange. If Rights
certificates are distributed, Laidlaw Environmental will distribute a separate
letter of transmittal for such Rights certificates. If Rights certificates are
tendered separately from Shares, then a properly completed letter of transmittal
for Rights certificates (or manually executed facsimile thereof) must be
submitted with respect to such Rights. Laidlaw Environmental reserves the right
to require that it receive such Rights certificates (or a Book-Entry
Confirmation with respect to such Rights) prior to accepting Shares for
exchange.

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<PAGE> 42

Nevertheless, Laidlaw Environmental will be entitled to accept for exchange
Shares tendered by a shareholder prior to receipt of the Rights certificates
required to be tendered with such Shares or a Book-Entry Confirmation with
respect to such Rights and either (i) subject to complying with applicable rules
and regulations of the Commission, withhold payment for such Shares pending
receipt of the Rights certificates or a Book-Entry Confirmation for such Rights
or (ii) exchange Shares accepted for exchange pending receipt of the Rights
certificates or a Book-Entry Confirmation for such Rights in reliance upon the
guaranteed delivery procedure described below. In addition, after expiration of
the Rights Delivery Period, Laidlaw Environmental may instead elect to reject as
invalid a tender of Shares with respect to which Rights certificates or a Book-
Entry Confirmation for an equal number of Rights have not been received by the
Exchange Agent. Any determination by Laidlaw Environmental to make payment for
Shares in reliance upon such guaranteed delivery procedure or, after expiration
of the Rights Delivery Period, to reject as invalid, shall be made, subject to
applicable law, in the sole and absolute discretion of Laidlaw Environmental.

The Exchange Agent will establish accounts with respect to the Shares at
the Book-Entry Transfer Facility for purposes of the Offer within two business
days after the date of the mailing of the final Prospectus, and any financial
institution that is a participant in any of the Book-Entry Transfer Facility
systems may make book-entry delivery of the Shares by causing the Book-Entry
Transfer Facility to transfer such Shares into the Exchange Agent's account in
accordance with the Book-Entry Transfer Facility's procedure for such transfer.
However, although delivery of Shares may be effected through book-entry at the
Book-Entry Transfer Facility, the Letter of Transmittal (or facsimile thereof),
with any required signature guarantees, or an Agent's Message in connection with
a book-entry transfer, and any other required documents, must, in any case, be
transmitted to and received by the Exchange Agent at one or more of its
addresses set forth on the back cover of this Prospectus prior to the Expiration
Date, or the guaranteed delivery procedure described below must be complied
with. No assurance can be given, however, that book-entry delivery of Rights
will be available. If book-entry delivery is not available, a tendering
shareholder will be required to tender Rights by means of delivery of Rights
certificates or pursuant to the guaranteed delivery procedure set forth below.

No signature guarantee is required on the Letter of Transmittal in cases
where (a) the Letter of Transmittal is signed by the registered holder(s) of the
Shares (including any participant in the Book-Entry Transfer Facility whose name
appears on a security position listing as the owner of Shares) tendered
therewith and such holder(s) have not completed the instruction entitled
"Special Issuance Instructions" on the Letter of Transmittal or (b) such Shares
are tendered for the account of an Eligible Institution. Otherwise, all
signatures on the Letter of Transmittal must be guaranteed by an Eligible
Institution. If the certificates for Shares or Rights (if any) are registered in
the name of a person other than the signer of the Letter of Transmittal, or if
certificates for unexchanged Shares or Rights (if any) are to be issued to a
person other than the registered holder(s), the certificates must be endorsed or
accompanied by appropriate stock powers, in either case signed exactly as the
name or names of the registered owner or owners appear on the certificates, with
the signature(s) on the certificates or stock powers guaranteed as aforesaid.

THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND ALL OTHER REQUIRED
DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY TRANSFER FACILITY, IS AT
THE OPTION AND RISK OF THE TENDERING SHAREHOLDER, AND THE DELIVERY WILL BE
DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE AGENT. IF DELIVERY IS BY
MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS
RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY
DELIVERY.

TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING WITH RESPECT TO CASH
CONSIDERATION AND CASH RECEIVED IN LIEU OF FRACTIONAL SHARES OF LAIDLAW
ENVIRONMENTAL COMMON STOCK, A SHAREHOLDER MUST PROVIDE THE EXCHANGE AGENT WITH
HIS OR HER CORRECT TAXPAYER IDENTIFICATION NUMBER AND CERTIFY WHETHER SUCH
SHAREHOLDER IS SUBJECT TO BACKUP WITHHOLDING OF FEDERAL INCOME TAX BY COMPLETING
THE SUBSTITUTE FORM W-9 INCLUDED IN THE LETTER OF TRANSMITTAL. CERTAIN
SHAREHOLDERS (INCLUDING, AMONG OTHERS, ALL CORPORATIONS AND CERTAIN FOREIGN
INDIVIDUALS) ARE NOT SUB-

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JECT TO THESE BACKUP WITHHOLDING AND REPORTING REQUIREMENTS. IN ORDER FOR A
FOREIGN INDIVIDUAL TO QUALIFY AS AN EXEMPT RECIPIENT, THE SHAREHOLDER MUST
SUBMIT A FORM W-8, SIGNED UNDER PENALTIES OF PERJURY, ATTESTING TO THAT
INDIVIDUAL'S EXEMPT STATUS.

If a Safety-Kleen Shareholder desires to tender Shares (and Rights, if
applicable) pursuant to the Offer and such shareholder's certificates are not
immediately available or such shareholder cannot deliver the certificates and
all other required documents to the Exchange Agent prior to the Expiration Date
or such shareholder cannot complete the procedure for book-entry transfer on a
timely basis, such Shares (and Rights, if applicable) may nevertheless be
tendered, provided that all of the following conditions are satisfied:

(a) such tenders are made by or through an Eligible Institution;

(b) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form made available by Laidlaw
Environmental, is received by the Exchange Agent as provided below on or
prior to the Expiration Date; and

(c) the certificates for all tendered Shares (or a confirmation of a
book-entry transfer of such securities into the Exchange Agent's account at
a Book-Entry Transfer Facility as described above), in proper form for
transfer, together with a properly completed and duly executed Letter of
Transmittal (or facsimile thereof), with any required signature guarantees
(or, in the case of a book-entry transfer, an Agent's Message) and all
other documents required by the Letter of Transmittal are received by the
Exchange Agent within three NYSE trading days after the date of execution
of such Notice of Guaranteed Delivery.

The Notice of Guaranteed Delivery may be delivered by hand or transmitted
by facsimile transmission or mail to the Exchange Agent and must include a
guarantee by an Eligible Institution in the form set forth in such Notice.

In all cases, exchanges of Shares (and Rights, if applicable) tendered and
accepted for exchange pursuant to the Offer will be made only after timely
receipt by the Exchange Agent of certificates for Shares (and Rights, if
applicable) (or timely confirmation of a book-entry transfer of such securities
into the Exchange Agent's account at a Book-Entry Transfer Facility as described
above), properly completed and duly executed Letter(s) of Transmittal (or
facsimile(s) thereof), or an Agent's Message in connection with a book-entry
transfer, and any other required documents. Accordingly, tendering Safety-Kleen
Shareholders may be paid at different times depending upon when certificates for
Shares (and Rights, if applicable) or confirmations of book-entry transfers of
such Shares (and Rights, if applicable) are actually received by the Exchange
Agent.

By executing a Letter of Transmittal as set forth above, the tendering
Safety-Kleen Shareholder irrevocably appoints designees of Laidlaw Environmental
as such shareholder's attorneys-in-fact and proxies, each with full power of
substitution, to the full extent of such shareholder's rights with respect to
the Shares (and Rights, if applicable) tendered by such shareholder and accepted
for exchange by Laidlaw Environmental and with respect to any and all other
Shares (and Rights, if applicable) and other securities issued or issuable in
respect of the Shares (and Rights, if applicable) on or after ,
1997. Such appointment is effective, and voting rights will be affected, when
and only to the extent that Laidlaw Environmental deposits the shares of Laidlaw
Environmental Common Stock and Cash Consideration for Shares tendered by such
shareholder with the Exchange Agent. All such proxies shall be considered
coupled with an interest in the tendered Shares and therefore shall not be
revocable. Upon the effectiveness of such appointment, all prior proxies given
by such shareholder will be revoked, and no subsequent proxies may be given
(and, if given, will not be deemed effective). Laidlaw Environmental's designees
will, with respect to the Shares for which the appointment is effective, be
empowered, among other things, to exercise all voting and other rights of such
shareholder as they, in their sole discretion, deem proper at any annual,
special or adjourned meeting of Safety-Kleen Shareholders, by written consent in
lieu of any such meeting or otherwise. Laidlaw Environmental reserves the right
to require that, in order for Shares to be deemed validly tendered, immediately
upon

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<PAGE> 44

Laidlaw Environmental's exchange of such Shares, Laidlaw Environmental must be
able to exercise full voting rights with respect to such Shares.

All questions as to the validity, form, eligibility (including time of
receipt) and acceptance for exchange of any tender of Shares (and Rights, if
applicable) will be determined by Laidlaw Environmental, in its sole discretion,
which determination shall be final and binding. Laidlaw Environmental reserves
the absolute right to reject any and all tenders of Shares (and Rights, if
applicable) determined by it not to be in proper form or the acceptance of or
exchange for which may, in the opinion of Laidlaw Environmental's counsel, be
unlawful. Laidlaw Environmental also reserves the absolute right to waive any of
the conditions of the Offer (other than the Laidlaw Environmental Stockholder
Approval Condition, the Regulatory Approval Condition and the condition relating
to the effectiveness of the Registration Statement), or any defect or
irregularity in the tender of any Shares (and Rights, if applicable). No tender
of Shares (and Rights, if applicable) will be deemed to have been validly made
until all defects and irregularities in tenders of Shares have been cured or
waived. Neither Laidlaw Environmental, the Exchange Agent, the Information
Agent, the Dealer Manager nor any other person will be under any duty to give
notification of any defects or irregularities in the tender of any Shares or
will incur any liability for failure to give any such notification. Laidlaw
Environmental's interpretation of the terms and conditions of the Offer
(including the Letter of Transmittal and instructions thereto) will be final and
binding.

The tender of Shares and Rights (if any) pursuant to any of the procedures
described above will constitute a binding agreement between the tendering
Safety-Kleen Shareholder and Laidlaw Environmental upon the terms and subject to
the conditions of the Offer.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

The following is a summary of certain federal income tax consequences of
the Offer and the Merger and represents the opinion of Katten Muchin & Zavis,
counsel to Laidlaw Environmental. It does not address any tax consequences of
the Offer and the Merger to persons who exercise appraisal rights, if any, to
the Merger. This summary may not apply to certain classes of persons subject to
special tax treatment, such as foreign persons, insurance companies, tax-exempt
organizations, financial institutions, dealers in securities, persons who
acquired Shares pursuant to the exercise of employee stock options or rights or
otherwise as compensation and persons who hold Shares as part of a straddle or
conversion transaction. This summary is based upon laws, regulations, rulings
and decisions, all of which are subject to change (possibly with retroactive
effect), and no ruling has been or will be requested from the Internal Revenue
Service (the "Service") on the tax consequences of the Offer and the Merger.

The exchange of Shares for Laidlaw Environmental Common Stock and cash
pursuant to the Offer and Merger will be a taxable transaction for U.S. federal
income tax purposes and may also be taxable under applicable state, local and
foreign tax laws. In general, for U.S. federal income purposes, each
Safety-Kleen Shareholder will realize gain or loss equal to the difference
between (x) the amount of cash and the fair market value of the shares Laidlaw
Environmental Common Stock received and (y) the Safety-Kleen Shareholder's
adjusted tax basis in the Shares exchanged therefor. Such gain or loss will be
capital gain or loss if the Safety-Kleen Shareholder holds the Shares as a
capital asset and will be long-term gain or loss if the Safety-Kleen
Shareholder's holding period for the Shares is more than eighteen months. The
Safety-Kleen Shareholder will have a tax basis in the Laidlaw Environmental
Common Stock received equal to the fair market value thereof and the
shareholder's holding period for the Laidlaw Environmental Common Stock will
begin on the day following the date of the exchange.

If the Board of Safety-Kleen agrees to the Offer, the Merger may be
restructured as a partially tax-free merger for U.S. federal income tax
purposes. If the Merger is structured to qualify as a partially tax-free merger
for U.S. federal income tax purposes, the material federal income tax
consequences to the Safety-Kleen Shareholders will be as follows:

1. No gain or loss will be recognized or be included in the income of
a Safety-Kleen Shareholder to the extent that a Safety-Kleen Shareholder
exchanges Shares for Laidlaw Environmental Common Stock in the Merger.

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2. A Safety-Kleen Shareholder will recognize taxable income to the
extent that the Safety-Kleen Shareholder receives cash in the Merger in an
amount equal to the lesser of (i) the amount of cash received in the
Merger, or (ii) an amount equal to the difference between (a) the amount of
cash and the fair market value of the shares of Laidlaw Environmental
Common Stock received and (b) the Safety-Kleen Shareholder's adjusted tax
basis in the Shares exchanged therefor. Such gain generally will be
long-term capital gain if the Safety-Kleen Shareholder's holding period for
the shares is more than eighteen months.

3. Assuming that a Safety-Kleen Shareholder holds the Shares as a
capital asset, such Shareholder's holding period for the Laidlaw
Environmental Common Stock received in the Merger will include the period
during which such Shares were held; and

4. The tax basis of the Laidlaw Environmental Common Stock received in
the Merger will be equal to the tax basis a Safety-Kleen Shareholder has in
Shares immediately before the Merger, decreased by the amount of cash
received in the Merger, and increased by the amount of gain recognized by a
Safety-Kleen Shareholder in the Merger.

This summary relates to some of the anticipated federal income tax
consequences of the Offer and the Merger. The analysis contain herein does not
address state, local or foreign tax consequences of the Offer and the Merger,
and is not intended as a substitute for careful tax planning, particularly since
certain of the tax consequences of the Offer and the Merger will not be the same
for all taxpayers. Consequently, each holder should consult such holder's own
tax advisor as to the specific tax consequences of the Offer and the Merger to
such holder.

EFFECT OF OFFER ON MARKET FOR SHARES; REGISTRATION UNDER THE EXCHANGE ACT

The Shares are listed and traded on the NYSE. Depending upon the number of
Shares acquired pursuant to the Offer, the Shares may no longer meet the
requirements of such exchange for continued listing. For example, published
guidelines of the NYSE indicate that the NYSE would consider delisting the
outstanding Shares if, among other things, (i) the number of publicly held
Shares (exclusive of holdings of officers, directors and members of their
immediate families and other concentrated holdings of 10% or more) should fall
below 600,000, (ii) the number of record holders of 100 or more Shares should
fall below 1,200 or (iii) the aggregate market value of publicly held Shares
should fall below $5 million. According to the Safety-Kleen Form 10-Q for the
quarter ended September 6, 1997, there were, as of September 6, 1997, 58,400,729
Shares outstanding. As of December 28, 1996 there were 8,042 holders of record
of Shares.

If the NYSE were to delist the Shares, the market could be adversely
affected. It is possible that the Shares would be traded on other securities
exchanges or in the over-the-counter market, and that price quotations would be
reported by such exchanges, or through the National Association of Securities
Dealers, Inc., Automated Quotations System ("Nasdaq") or by other sources. The
extent of the public market for the Shares and the availability of such
quotations would, however, depend upon the number of holders and/or the
aggregate market value of the Shares remaining at such time, the interest in
maintaining a market in the Shares on the part of securities firms, the possible
termination of registration of Shares under the Exchange Act, as described
below, and other factors.

The Shares are presently "margin securities" under the regulations of the
Federal Reserve Board, which has the effect, among other things, of allowing
brokers to extend credit on the collateral of such Shares. Depending on factors
similar to those described above with respect to listing and market quotations,
following consummation of the Offer the Shares may no longer constitute "margin
securities" for the purposes of the Federal Reserve Board's margin regulations,
in which event the Shares would be ineligible as collateral for margin loans
made by brokers.

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<PAGE> 46

The Shares are currently registered under the Exchange Act. Such
registration may be terminated by Safety-Kleen upon application to the
Commission if the outstanding Shares are not listed on a national securities
exchange and if there are fewer than 300 holders of record of Shares.
Termination of registration of the Shares under the Exchange Act would reduce
the information required to be furnished by Safety-Kleen to its shareholders and
to the Commission and would make certain provisions of the Exchange Act, such as
the short-swing profit recovery provisions of Section 16(b) and the requirement
of furnishing a proxy statement in connection with shareholders' meetings
pursuant to Section 14(a) and the related requirement of furnishing an annual
report to shareholders, no longer applicable with respect to the Shares.
Furthermore, the ability of "affiliates" of Safety-Kleen and persons holding
"restricted securities" of Safety-Kleen to dispose of such securities pursuant
to Rule 144 under the Securities Act may be impaired or eliminated. If
registration of the Shares under the Exchange Act were terminated, the Shares
would no longer be eligible for Nasdaq reporting or for continued inclusion on
the Federal Reserve Board's list of "margin securities."

The Rights currently are registered under the Exchange Act and are listed
on the NYSE, but currently are attached to the outstanding Shares and are not
separately transferable. If the Distribution Date occurs, the Rights may become
transferable apart from the Shares, unless previously redeemed. If the Rights
are not redeemed or invalidated and Laidlaw Environmental waives the Rights Plan
Condition, then the foregoing discussion with respect to the effect of the Offer
on the Shares would be similarly applicable to the Rights (although the
continued listing criteria are different).

PURPOSE OF THE OFFER; THE MERGER

The purpose of the Offer is to enable Laidlaw Environmental to obtain
control of, and ultimately the entire equity interest in, Safety-Kleen.

The Offer, as the first step in the Acquisition by Laidlaw Environmental,
is intended to facilitate the acquisition of all Shares. Laidlaw Environmental
presently intends, following consummation of the Offer, to propose and seek to
have Safety-Kleen effect the Merger. In the Merger, each outstanding Share
(other than Shares owned by Laidlaw Environmental or any of its affiliates,
Shares held in the treasury of Safety-Kleen or by any subsidiary of Safety-Kleen
and Shares owned by Safety-Kleen Shareholders who perfect dissenter rights under
Wisconsin law) would be canceled in exchange for the right to receive the Offer
Consideration. Assuming the Minimum Tender Condition is satisfied and the other
Conditions to the Offer are satisfied (or waived, as applicable) and Laidlaw
Environmental consummates the Offer, Laidlaw Environmental would be able to
consummate the Merger without any additional vote of the holders of Laidlaw
Environmental Common Stock or the vote of any other Safety-Kleen Shareholder.

It is Laidlaw Environmental's current intention to consummate the Offer as
soon as the conditions to the Offer are satisfied and to consummate the Merger
in .

CONDITIONS OF THE OFFER

Minimum Tender Condition. The Offer is conditioned upon, among other
things, there being validly tendered and not withdrawn prior to the Expiration
Date a number of Shares which, together with Shares owned by Laidlaw
Environmental and its affiliates, will constitute at least two-thirds of the
total number of outstanding Shares on a fully diluted basis (as though all
options or other securities convertible into or exercisable or exchangeable for
Shares, other than the Rights, had been so converted, exercised or exchanged) as
of the date the Shares are accepted for exchange by Laidlaw Environmental
pursuant to the Offer. Based upon information set forth in the Safety-Kleen Form
10-Q for the quarter ended September 6, 1997, as of September 6, 1997, there
were 58,400,729 Shares outstanding. As of November 18, 1997, Laidlaw
Environmental owned 601,100 Shares, or approximately 1.03% of the outstanding
Shares. Based on the foregoing, Laidlaw Environmental believes that the Minimum
Tender Condition would be satisfied if at least an aggregate of 42,302,789
Shares (or 66 2/3%) of the Shares expected to be outstanding immediately prior
to the consummation of the Offer had been validly tendered pursuant to the Offer
and not withdrawn. Laidlaw Environmental reserves the right (but shall not be
obligated), subject to the rules and regulations of the Commission, to waive or
amend the Minimum Tender Condition and to exchange fewer than such number of

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<PAGE> 47

Shares as would satisfy the Minimum Tender Condition pursuant to the Offer;
provided, however, that, in the event of such waiver or amendment, the Offer
shall expire no sooner than ten business days from the date of such waiver or
amendment.

Laidlaw Environmental Stockholder Approval Condition. The Offer is
conditioned, among other things, upon the satisfaction of the Laidlaw
Environmental Stockholder Approval Condition. The authorization to increase the
number of shares of Laidlaw Environmental Common Stock to 750,000,000 must be
approved by a majority of the outstanding shares of Laidlaw Environmental Common
Stock. The issuance of Laidlaw Environmental Common Stock pursuant to the Offer
and the Merger must be approved by the holders of a majority of the shares of
Laidlaw Environmental Common Stock voted at a meeting of such holders at which
the total number of votes cast represents over 50% in interest of all shares of
Laidlaw Environmental Common Stock outstanding on the applicable record date.
Laidlaw Environmental intends to seek such approvals at the Laidlaw
Environmental Special Meeting to be held on or about , 1997.
Laidlaw, which presently owns 67% of Laidlaw Environmental Common Stock, intends
to vote its shares to approve the increase in the number of shares of Laidlaw
Environmental Common Stock and the issuance of Laidlaw Environmental Common
Stock pursuant to the Offer and the Merger.

Rights Plan Condition. The Offer is conditioned upon, among other things,
the satisfaction of the Rights Plan Condition. The Rights Plan Condition may be
satisfied in several ways, including the current Safety-Kleen Board may (a)
amend the Rights Agreement so that the Rights would not be triggered by the
Offer and the Merger or (b) redeem the Rights.

Set forth below is certain additional information concerning the Rights
Agreement. This information is based upon information included in Safety-Kleen's
publicly filed documents.

On November 9, 1988, the Safety-Kleen Board declared a dividend of one
common share purchase right ("Right") on each outstanding Share payable to
Safety-Kleen Shareholders of record on November 21, 1988 (the "Record Date").
Each Right entitles the holder thereof to buy one Share at an exercise price of
$73.33, subject to adjustment. The terms of the Rights are set forth in the
Rights Agreement. The following description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the Rights Agreement
which is filed as an exhibit to the Safety-Kleen Registration Statement on Form
8-A dated December 28, 1988, as amended on August 27, 1990.

Until the earlier to occur of (i) 10 days following a public announcement
that a person or group of affiliated or associated persons (an "Acquiring
Person") has acquired beneficial ownership of 20% or more of the outstanding
Shares or (ii) 10 business days (or such later date as may be determined by
action of the Safety-Kleen Board prior to such time as any person or group
becomes an Acquiring Person) following the commencement of, or announcement of
an intention to make, a tender offer or exchange offer the consummation of which
would result in the beneficial ownership by a person or group of 20% or more of
such outstanding Shares (the earlier of such dates being called the
"Distribution Date"), the Rights will be evidenced by Share certificates.

The Rights Agreement provides that, until the Distribution Date, the Rights
will be transferred with and only with the Shares. Until the Distribution Date
(or earlier redemption or expiration of the Rights), new Share certificates
issued after the Record Date will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date (or earlier redemption or
expiration of the Rights), the surrender for transfer of any certificates for
Shares will also constitute the transfer of the Rights associated with the
Shares represented by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Shares as of the close
of business on the Distribution Date and such separate Right Certificate alone
will evidence the Rights.

The Rights are not exercisable until the Distribution Date. The Rights will
expire on November 21, 1998 (the "Final Expiration Date"), unless the Rights are
earlier redeemed by Safety-Kleen, as described below.

A person shall not be deemed to have become an "Acquiring Person" for any
purposes if, as determined in good faith by the Safety-Kleen Board, he
inadvertently becomes an Acquiring Person and promptly thereafter divests
himself of sufficient Shares to no longer be an "Acquiring Person".

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<PAGE> 48

The Purchase Price payable, and the number of Shares or other securities or
property issuable, upon exercise of the Rights are subject to adjustment from
time to time to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Shares, (ii) upon the grant
to holders of the Shares of certain rights or warrants to subscribe for or
purchase Shares at a price, or securities convertible into Shares with a
conversion price, less than the then current market price of the Shares or (iii)
upon the distribution to holders of the Shares of evidences of indebtedness or
assets (excluding regular periodic cash dividends paid out of earnings or
retained earnings or dividends payable in Shares) or of subscription rights or
warrants (other than those referred to above). With certain exceptions, no
adjustment in the Purchase Price will be required until cumulative adjustments
require an adjustment of at least 1% in such Purchase Price. No fractional
Shares will be issued and in lieu thereof, an adjustment in cash will be made
based on the market price of the Shares on the last trading day prior to the
date of exercise.

If any person becomes an Acquiring Person, each holder of a Right, other
than Rights beneficially owned by the Acquiring Person (which will be void),
will have the right to receive upon exercise of such Right that number of Shares
having a market value of two times the exercise price of the Right.

In addition, if Safety-Kleen is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning
power are sold, proper provision will be made so that each holder of a Right
will thereafter have the right to receive, upon the exercise thereof at the then
current exercise price of the Right, that number of shares of common stock of
the acquiring company which at the time of such transaction will have a market
value of two times the exercise price of the Right.

At any time after the acquisition by a person or group of affiliated or
associated persons of beneficial ownership of 20% or more of the outstanding
Shares and prior to the acquisition by such person or group of 50% or more of
the outstanding Shares, the Safety-Kleen Board may exchange the Rights (other
than Rights owned by such person or group which have become void), in whole or
in part, at an exchange ratio of one Share per Right (subject to adjustment).

At any time prior to the acquisition by a person or group of affiliated or
associated persons of beneficial ownership of 20% or more of the outstanding
Shares, the Safety-Kleen Board may redeem the Rights in whole, but not in part,
at a price of 0.67 cents per Right, subject to adjustment (the "Redemption
Price"). The redemption of the Rights may be made effective at such time, on
such basis and with such conditions as the Safety-Kleen Board in its sole
discretion may establish; provided, however, that no redemption will be
permitted or required after the acquisition by any person or group of affiliated
or associated persons of beneficial ownership of 20% or more of the outstanding
Shares. Immediately upon any redemption of the Rights, the right to exercise the
Rights will terminate and the only right of the holders of the Rights will be to
receive the Redemption Price.

The terms of the Rights may be amended by the Safety-Kleen Board without
the consent of the holders of the Rights including an amendment to lower the
threshold for exercisability of the Rights from 20% to not less than the greater
of (i) any percentage greater than the largest percentage of the outstanding
Shares then known to Safety-Kleen to be beneficially owned by any person or
group of affiliated or associated persons and (ii) 10%, except that from and
after such time as any person becomes an Acquiring Person no such amendment may
adversely affect the interests of the holders of the Rights.

Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of Safety-Kleen including, without limitation, the right
to vote or to receive dividends.

The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group of persons that attempts to acquire
Safety-Kleen in a manner which causes the Rights to become exercisable.

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<PAGE> 49

become an "Acquiring Person" (as defined in the Rights Agreement), (ii) give
rise to a "Distribution Date" (as defined in the Rights Agreement) or (iii)
trigger certain other events specified in the Rights Agreement.

Wisconsin Statutory Condition. The Offer is conditioned upon, among other
things, Laidlaw Environmental being satisfied, in its sole discretion, either
that the provisions of Section 180.1141 and Section 180.1150 of the Wisconsin
Statutes are inapplicable to Laidlaw Environmental, LES Acquisition and the
transactions contemplated herein, or that (i) full voting rights for all Shares
to be acquired by Laidlaw Environmental and LES Acquisition pursuant to the
offer have been restored by the shareholders of Safety-Kleen pursuant to the
Wisconsin Statutes, and (ii) the Wisconsin Statutes will not prohibit for any
period of time the consummation of the Merger or any other "business
combination" (as defined in such statutes) involving Safety-Kleen and Laidlaw
Environmental or LES Acquisition, or any of their respective affiliates.

Section 180.1141 of the Wisconsin Statutes ("Wisconsin Business Combination
Statute") prohibits certain business combinations involving a Wisconsin
"resident domestic corporation" (as defined in Section 180.1140(9)(a) of the
Wisconsin Statutes). This portion of the Wisconsin Statutory Condition may be
satisfied by (i) the Safety-Kleen Board of Directors approving the Offer for the
purposes of Section 180.1141 prior to the consummation of the Offer or (ii)
Laidlaw Environmental being satisfied, in its sole discretion, that Safety-Kleen
is not a "resident domestic corporation" as defined in Section 180.1140(9)(a) of
the Wisconsin Statutes. For a summary of the Business Combination Statute, see
"Comparison of the Rights of Holders of Shares and Laidlaw Environmental Common
Stock -- Comparison of Delaware and Wisconsin
Law -- Differences -- Anti-Takeover Statutes."

Section 180.1150 of the Wisconsin Statutes ("Wisconsin Control Share
Statute") limits the voting power of shares of a "resident domestic corporation"
(as defined in Section 180.1150(1)(c) of the Wisconsin Statutes) that are held
by certain persons holding in excess of 20% of the voting power of such shares
in the election of the directors. This portion of the Wisconsin Statutory
Condition may be satisfied by (i) the affirmative vote of a majority of the
voting power of shares represented and entitled to vote at a special meeting of
Safety-Kleen Shareholders to restore regular voting power of the Shares to be
acquired by Laidlaw Environmental, or (ii) Laidlaw Environmental being
satisfied, in its sole discretion, that the provisions of the Wisconsin Control
Share Acquisition Statute do not in any way restrict Laidlaw Environmental's and
LES Acquisition's ability to consummate the Merger. For a summary of the
Wisconsin Control Share Acquisition Statute, see "Comparison of the Rights of
Holders of Shares and Laidlaw Environmental Common Stock -- Comparison of
Delaware and Wisconsin Law -- Differences -- Anti-Takeover Statutes."

Laidlaw Environmental and LES Acquisition are requesting that
Safety-Kleen's Board of Directors take appropriate action so that the Wisconsin
Business Combination Statute is not applicable to the acquisition of Shares
pursuant to the Offer or a subsequent business combination involving Laidlaw
Environmental or LES Acquisition and Safety-Kleen. There can be no assurance
that the Safety-Kleen Board of Directors will do so.

See "Reasons for the Offer -- Background of the Offer."

The Wisconsin Statutes contain certain other provisions restricting certain
business combinations and other transactions with significant shareholders under
certain circumstances. Section 180.1150 of the Wisconsin Statutes limits, under
certain circumstances, the voting power of a shareholder that holds in excess of
20% of the voting power of certain corporations. See "Comparison of Delaware and
Wisconsin Law -- Differences."

Regulatory Approval Condition. The Offer is conditioned upon, among other
things, all regulatory approvals required to consummate the Offer (the
"Requisite Regulatory Approvals") having been obtained and remaining in full
force and effect, all statutory waiting periods in respect thereof having
expired and no such approval containing any conditions or restrictions which the
Laidlaw Environmental Board determines will or reasonably could be expected to
materially impair the strategic and financial benefits expected to result from
the Offer. Laidlaw Environmental will use its reasonable best efforts to obtain
the Requisite Regulatory Approvals. As described below, applications and notices
seeking the Requisite Regulatory Approvals have been or will be promptly filed.
The Offer cannot proceed in the absence of the Requisite Regulatory

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<PAGE> 50

Approvals. Although no assurances can be given, Laidlaw Environmental
anticipates that it will receive all Requisite Regulatory Approvals on a timely
basis.

Antitrust. Under the HSR Act, and the Rules that have been promulgated
thereunder, certain acquisition transactions may not be consummated unless
certain information has been furnished to the Antitrust Division of the
Department of Justice (the "Antitrust Division") and the Federal Trade
Commission ("FTC") and certain waiting period requirements have been satisfied.
The acquisition of Shares by Laidlaw Environmental pursuant to the Offer is
subject to the expiration of the statutory waiting period under the HSR Act.

Laidlaw intends to file with the Antitrust Division and the FTC a
Hart-Scott-Rodino Notification and Report Form (the "Notification Form") with
respect to the Offer. Under the applicable provisions of the HSR Act, the
purchase of Shares under the Offer could not be consummated until the expiration
of a 30-day waiting period following the filing of the Notification Form by
Laidlaw, unless Laidlaw receives a request for additional information or
documentary material or the Antitrust Division and the FTC terminate the waiting
period thereto. If, within such 30-day waiting period, either the Antitrust
Division or the FTC requests additional information or material from Laidlaw
and/or Safety-Kleen concerning the Offer, the waiting period will be extended
for an additional 20 days after Laidlaw has substantially complied with such
request. Only one extension of the waiting period pursuant to a request for
additional information is authorized by the HSR Act. Thereafter, the waiting
period may be extended only by court order or with the consent of Laidlaw.

Laidlaw Environmental will not accept for exchange Shares tendered pursuant
to the Offer unless and until the waiting period requirements imposed by the HSR
Act with respect to the Offer have been satisfied.

Federal and state antitrust enforcement agencies frequently scrutinize,
under the antitrust laws, transactions such as Laidlaw Environmental's
acquisition of Shares pursuant to the Offer. At any time before or after Laidlaw
Environmental's acquisition of Shares, any such agency could take such action
under the antitrust laws as it deems necessary or desirable in the public
interest, including seeking to enjoin the acquisition of Shares pursuant to the
Offer or otherwise or seeking divestiture of Shares acquired by Laidlaw
Environmental or divestiture of substantial assets of Laidlaw Environmental
and/or Safety-Kleen. Private parties may also bring legal action under the
antitrust laws under certain circumstances.

Based upon an examination of publicly available information relating to the
businesses in which both Laidlaw Environmental and Safety-Kleen are engaged,
Laidlaw Environmental believes that the Offer will not violate the antitrust
laws. Nevertheless, there can be no assurance that a challenge to the Offer on
antitrust grounds will not be made or that, if such a challenge is made, Laidlaw
Environmental will prevail.

Canadian Competition Act. Under the Canadian Federal Competition Act (the
"Competition Act"), acquisition transactions, insofar as they relate to the
acquisition of such Canadian subsidiaries, qualify as a "merger" if they are of
sufficient size to be subject to the notification and waiting period
requirements of the Competition Act. The Competition Act is administered by the
Canadian Director of Investigation and Research appointed under the Competition
Act (the "Competition Act Director"). Laidlaw Environmental believes that the
proposed transaction requires notification and intends to file the required
information with the Competition Act Director.

Europe. The acquisition of Shares by Laidlaw Environmental pursuant to the
Offer is subject to prior notification requirements of several of the member
countries of the European Union in which Safety-Kleen operates. Based on the
limited information concerning Safety-Kleen that is available to Laidlaw
Environmental, filings will be necessary in the Republic of Ireland and Federal
Republic of Germany. In addition, filings may also be necessary in Italy and
Belgium. The necessary filings must be made in sufficient time to allow the
passing of a one month waiting period before Laidlaw Environmental's acquisition
of shares pursuant to the

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<PAGE> 51

Offer may be completed. No pre-merger notification under the European Economic
Community's Merger Control Regulation is required for the proposed transaction.

Buyout Expense Condition. The acquisition of Shares by Laidlaw
Environmental pursuant to the Offer is subject to Laidlaw Environmental's
receipt of a final judicial determination (i) to the effect that Safety-Kleen is
not obligated to, and may not, pay any Buyout Proposal Expenses or (ii) stating
the amount of Buyout Proposal Expenses that Safety-Kleen is required to pay.
Although Laidlaw Environmental has initiated litigation against Safety-Kleen and
its Board of Directors seeking to have the provisions in the Buyout Merger
Agreement requiring the payment of Buyout Proposal Expenses declared invalid,
there can be no assurance that such relief will be granted. In such event,
Laidlaw Environmental will seek to have a judicial determination of the amount
of Buyout Proposal Expenses required to be paid by Safety-Kleen in order to
permit a determination of the amount of the Cash Consideration to be paid
pursuant to the Offer.

General. Except as set forth above, based upon an examination of publicly
available information filed by Safety-Kleen with the Commission and other
publicly available information with respect to Safety-Kleen, Laidlaw
Environmental is not aware of (a) any license or regulatory permit which appears
to be material to the business of Safety-Kleen and its subsidiaries, taken as a
whole, and which is likely to be adversely affected by Laidlaw Environmental's
acquisition of Shares pursuant to the Offer or (b) any approval or other action
by any state, federal or foreign governmental administrative or regulatory
agency or authority that would be required prior to the acquisition of Shares
pursuant to the Offer. Laidlaw Environmental presently intends to take such
actions with respect to any approvals as will enable it to consummate the Offer.
In this regard, Laidlaw Environmental expressly reserves the right to challenge
the validity and applicability of any state, foreign or other statutes or
regulations purporting to require approval of the consummation of the Offer.

There can be no assurance that any license, permit, approval or other
action, if needed, would be obtained, or would be obtained without substantial
conditions, or, if so obtained, when it would be obtained, or that adverse
consequences might not result to Safety-Kleen, Laidlaw Environmental or their
respective businesses in the event of adverse regulatory action or inaction.

THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, LAIDLAW ENVIRONMENTAL
HAVING RECEIVED ALL REQUIRED REGULATORY APPROVALS FOR THE ACQUISITION OF SHARES
PURSUANT TO THE OFFER, THE MERGER AND THE OTHER TRANSACTIONS CONTEMPLATED
HEREIN, INCLUDING APPROVALS AND CONSENTS FROM THE ANTITRUST DIVISION AND THE FTC
AND SUCH APPROVALS AND CONSENTS REMAINING IN FULL FORCE AND EFFECT, ALL
STATUTORY WAITING PERIODS IN RESPECT THEREOF HAVING EXPIRED AND NO SUCH APPROVAL
CONTAINING ANY CONDITIONS OR RESTRICTIONS WHICH THE LAIDLAW ENVIRONMENTAL BOARD
DETERMINES WILL OR REASONABLY COULD BE EXPECTED TO MATERIALLY IMPAIR THE
STRATEGIC AND FINANCIAL BENEFITS EXPECTED TO RESULT FROM THE OFFER.

Certain Other Conditions of the Offer. Notwithstanding any other provision
of the Offer and subject to any applicable rules and regulations of the
Commission, including Rule 14e-1(c) under the Exchange Act (relating to Laidlaw
Environmental's obligation to exchange or return tendered Shares promptly after
the termination or withdrawal of the Offer), Laidlaw Environmental shall not be
required to accept for exchange or exchange any Shares, may postpone the
acceptance for exchange or exchange for tendered Shares and may, in its sole
discretion, terminate or amend the Offer as to any Shares not then exchanged if
at the Expiration Date any of the Offer Conditions have not been satisfied or
waived or if on or after the date of this Prospectus and on or prior to the
Expiration Date any of the following events shall not have occurred:

(a) The shares of Laidlaw Environmental Common Stock (and accompanying
Rights) which shall be issued to the Safety-Kleen Shareholders in the Offer
and the Merger shall have been authorized for listing on the NYSE, subject
to official notice of issuance.

(b) The Registration Statement shall have become effective under the
Securities Act, and no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been initiated or threatened by the Commission.

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(c) No order, injunction or decree issued by any court or agency of
competent jurisdiction or other legal restraint or prohibition preventing
the consummation of the Offer and/or the Merger or any of the other
transactions contemplated by this Prospectus shall be in effect. No
statute, rule, regulation, order, injunction or decree shall have been
enacted, entered, promulgated or enforced by any court, administrative
agency or commission or other governmental authority or instrumentality
which prohibits, restricts or makes illegal the consummation of the Offer
and/or the Merger.

(d) There shall not have occurred or been threatened (i) any general
suspension of trading in, or limitation on times or prices for, securities
on any national securities exchange or in the over-the-counter market in
the United States, (ii) any significant adverse change in interest rates,
the financial markets or major stock exchange indices in the United States
or abroad or in the market price of Shares, including, without limitation,
a decline of at least 10% in either the Dow Jones Average of Industrial
Stocks or the Standard & Poor's 500 Index from that existing at the close
of business on , 1997, (iii) any change in the general
political, market, economic, regulatory or financial conditions in the
United States or abroad that could, in the reasonable judgment of Laidlaw
Environmental, have a material adverse effect upon the business,
properties, assets, liabilities, capitalization, stockholders' equity,
condition (financial or otherwise), operations, licenses or franchises,
results of operations or prospects of Safety-Kleen or any of its
subsidiaries or the trading in, or value of, the Shares, (iv) any material
change in United States currency exchange rates or any other currency
exchange rates or a suspension of, or limitation on, the markets therefor,
(v) a declaration of a banking moratorium or any suspension of payments in
respect of banks in the United States, (vi) any limitation (whether or not
mandatory) by any government, domestic, foreign or supranational, or
governmental entity on, or other event that in the reasonable judgment of
Laidlaw Environmental might affect, the extension of credit by banks or
other lending institutions, (vii) a commencement of a war or armed
hostilities or other national or international calamity directly or
indirectly involving the United States or (viii) in the case of any of the
foregoing existing at the time of the commencement of the Offer, a material
acceleration or worsening thereof.

The foregoing conditions are for the sole benefit of Laidlaw Environmental
and may be asserted by Laidlaw Environmental regardless of the circumstances
giving rise to any such conditions (including any action or inaction by Laidlaw
Environmental) or may be waived by Laidlaw Environmental in whole or in part
(other than the Laidlaw Environmental Stockholder Approval Condition, the
Regulatory Approval Condition and the condition relating to effectiveness of the
Registration Statement). The determination as to whether any condition has been
satisfied shall be in the sole judgment of Laidlaw Environmental and will be
final and binding on all parties. The failure by Laidlaw Environmental at any
time to exercise any of the foregoing rights shall not be deemed a waiver of any
such right, and each such right shall be deemed a continuing right which may be
asserted at any time and from time to time. Notwithstanding the fact that
Laidlaw Environmental reserves the right to assert the failure of a condition
following acceptance for exchange but prior to exchange in order to delay
exchange or cancel its obligation to exchange properly tendered Shares, Laidlaw
Environmental will either promptly exchange such Shares or promptly return such
Shares.

SOURCE AND AMOUNT OF FUNDS

Laidlaw Environmental estimates that the total amount of funds required
pursuant to the Offer to pay for the Cash Consideration in connection with the
exchange of all Shares outstanding on a fully diluted basis, to refinance
Laidlaw Environmental's existing bank debt, to refinance Safety-Kleen's existing
and outstanding indebtedness and to pay fees and expenses related to the Offer
will be approximately $1.5 billion. See "The Offer -- Fees and Expenses."
Laidlaw Environmental plans to obtain the outside funds necessary to finance the
Cash Consideration pursuant to credit facilities to be arranged by TD Securities
(USA), Inc. ("TDSI"). Laidlaw Environmental has received a written financing
commitment (the "Commitment Letter") from TDSI and Toronto-Dominion Bank ("TD")
to provide senior secured credit facilities in the aggregate principal amount of
up to $1.8 billion (the "Senior Credit Facilities"). The terms of the definitive
agreement for the Senior Credit Facilities (the "Loan Agreement") have not yet
been finalized. The following is a summary of the anticipated principal terms of
the Senior Credit Facilities based upon the Commitment

43
<PAGE> 53

Letter. This summary is subject to finalization of the Loan Agreement and is
qualified in its entirety by reference to the Commitment Letter, which is filed
as Exhibit (4)(p) hereto.

The Credit Facilities will consist of four parts: (i) a $400,000,000 6-year
Senior Secured Revolving Credit Facility with a $200,000,000 letter of credit
sublimit (the "Revolving Credit Facility" or "Facility A"), (ii) a $500,000,000
6-year Senior Secured Amortizing Term Loan ("Facility B"), (iii) a $450,000,000
Minimally Amortizing 7-year Senior Secured Term Facility ("Facility C") and (iv)
a $450,000,000 Minimally Amortizing 8-year Senior Secured Term Loan ("Facility
D"); (Facility B, Facility C and Facility D, collectively, the "Term Loans").
The Credit Facilities will be secured by all of the tangible assets of the
combined companies to the extent required by the syndicate of banks and other
financial institutions (collectively, the "Lenders") acceptable to Laidlaw
Environmental and the Agent that will make the loans pursuant to the Credit
Facilities. All of the capital stock of Laidlaw Environmental's subsidiaries,
including the acquired Safety-Kleen subsidiaries, will be pledged as part of
such security for the Credit Facilities, and such subsidiaries will guaranty the
obligations of Laidlaw Environmental to the Lenders. The Term Loans will be
drawn in full on the closing date. The Revolving Credit Facility will be
available commencing on the closing date at which time $200,000,000 will be
available for letters of credit and $250,000,000 will be available for loans,
subject to an aggregate maximum of $400,000,000.

Facility A will have no scheduled amortization. The Term Loans will require
aggregate principal repayments of $84 million in each of years 1, 2, 3 and 4,
$109 million in each of years 5 and 6, $428 million in year 7 and $419 million
in year 8.

Borrowings under the Senior Credit Facilities will bear interest at a
floating rate based upon, at LES Acquisition's option, (i) the higher of the TD
prime rate and the federal funds rate plus 0.50% per annum, or (ii) the London
Interbank Offered Rate ("LIBOR") adjusted for reserves, in each case plus a
margin based upon the total leverage ratio of LES Acquisition. LES Acquisition
also will pay administration fees, commitment fees, re-syndication fees (under
certain circumstances) and certain expenses and provide certain indemnities, all
of which LES Acquisition believes to be customary for commitments of this type.
The commitment fees have been paid or will be payable, as applicable, in stages,
beginning with the execution of the Commitment Letter and ending with a final
payment upon consummation of the financing. The Commitment Letter may be
extended beyond its expiration date of March 31, 1998 upon payment of an
additional fee.

The Loan Agreement will contain conditions precedent, representations and
warranties, covenants (including financial covenants), events of default and
other provisions customary for such financings.

TD's commitment to provide the Senior Credit Facilities is conditioned on,
among other things, the following: the negotiation, execution and delivery of
the Loan Agreement; receipt of all necessary or desirable governmental,
shareholder and third-party consents; the absence of a material adverse change
in the business assets, operations, condition (financial or otherwise), or
prospects of LES Acquisition, Safety-Kleen and their respective subsidiaries on
a consolidated basis; the execution of definitive agreements relating to the
Merger and the Offer; satisfactory completion of due diligence examinations;
prior or contemporaneous repayment in full of all existing indebtedness of each
of LES Acquisition and Safety-Kleen; and the successful syndication of $400
million of the $1.8 billion commitment; and after consummation of the
transactions at closing, either (i) Laidlaw Environmental shall hold a
sufficient number of shares to effect the Merger or (ii) the Merger shall have
been or, concurrently with the closing, shall be, consummated, and the surviving
corporation shall be a wholly-owned subsidiary of LES Acquisition.

It is anticipated that the indebtedness incurred through borrowings under
the Senior Credit Facilities will be repaid from funds generated internally by
LES Acquisition and its subsidiaries, and from other sources. No final decisions
have been made concerning the method LES Acquisition will employ to repay such
indebtedness. Such decisions when made will be based on LES Acquisition's review
from time to time of the advisability of particular actions, as well as on
prevailing interest rates and financial and other economic conditions.

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<PAGE> 54

CERTAIN DEBT INSTRUMENTS OF SAFETY-KLEEN

The long-term debt of Safety-Kleen as of September 6, 1997 totaled
$246,080,000. This long-term debt is comprised of (i) 9 1/4% Senior Notes due in
1999 (the "9 1/4% Notes"); (ii) 8 1/2% Senior Notes due in 1998 (the "8 1/2%
Notes", and together with the 9 1/4% Notes, the "Notes"); and (iii) unsecured
notes payable to banks under revolving lines of credit and uncommitted lines of
credit.

Upon the occurrence of a downgrade in a credit agency's rating of the
9 1/4% Notes in conjunction with a change of control, each holder of the Notes
may require the repurchase of all or part of such holder's Notes at a price
equal to the principal amount plus accrued interest.

RELATIONSHIPS WITH SAFETY-KLEEN

Except as to the transactions described below effected on the New York
Stock Exchange by a wholly owned subsidiary of Laidlaw Environmental, neither
Laidlaw Environmental nor, to the best of its knowledge, any of the persons
listed on Schedule A hereto nor any associate or majority-owned subsidiary of
any of the foregoing, beneficially owns or has a right to acquire any equity
securities of Safety-Kleen nor have they effected any transaction in such equity
securities during the last 60 days.

<TABLE>
<CAPTION>
NUMBER OF PRICE
DATE PURCHASED SHARES BOUGHT PER SHARE
- -------------- ------------- ---------
<S> <C> <C>
10/02/97.................................................. 100 $23.8750
10/28/97.................................................. 78,000 $20.5000
10/28/97.................................................. 85,000 $20.7500
10/28/97.................................................. 43,000 $21.5000
10/28/97.................................................. 23,000 $19.7500
10/28/97.................................................. 10,000 $20.2600
10/28/97.................................................. 2,000 $19.5000
10/29/97.................................................. 191,000 $22.0000
10/29/97.................................................. 91,000 $21.9375
10/29/97.................................................. 25,100 $21.8750
10/29/97.................................................. 38,200 $21.8125
10/29/97.................................................. 9,700 $21.7500
10/29/97.................................................. 5,000 $21.6250
</TABLE>

Neither Laidlaw Environmental nor, to the best of its knowledge, any of the
persons listed on Schedule A hereto has (i) any contract, arrangement,
understanding or relationship with any other person with respect to any
securities of Safety-Kleen, including, but not limited to, any contract,
arrangement, understanding or relationship concerning the transfer or the voting
of any such securities, joint ventures, loan or option arrangements, puts or
calls, guaranties of loans, guaranties against loss or the giving or withholding
of proxies; (ii) had any contacts or negotiations with Safety-Kleen or its
affiliates concerning a merger, consolidation or acquisition, a tender offer or
other acquisition of securities, an election of directors, or a sale or other
transfer of a material amount of assets, except as described herein; or (iii)
has had any transaction with Safety-Kleen or any of its executive officers,
directors or affiliates that would require disclosure under the rules and
regulations of the Commission applicable to the Offer except existing and
present business relationships (e.g., providing services to each other or
considering the purchase or sale of discrete assets or operations or alliances)
in the ordinary course of business none of which are material, the sale of
certain assets of a Laidlaw Environmental subsidiary to Safety-Kleen in February
1996 and the accompanying cooperative services agreement which is in the process
of being terminated.

FEES AND EXPENSES

Laidlaw Environmental has retained Morrow & Co., Inc. ("Information Agent")
to act as Information Agent in connection with the Offer. The Information Agent
may contact holders of Shares by mail, telephone, electronic mail and personal
interviews and may request brokers, dealers and other nominee shareholders to
forward the Offer materials to beneficial owners of Shares. The Information
Agent will be paid a customary

45
<PAGE> 55

fee of up to $ for such services, plus reimbursement of out-of-pocket
expenses, and Laidlaw Environmental will indemnify the Information Agent against
certain liabilities and expenses in connection with the Offer, including
liabilities under federal securities laws.

Bear Stearns is acting as financial advisor to Laidlaw Environmental in
connection with its effort to acquire Safety-Kleen and as Dealer Manager in
connection with the Offer, for which services Laidlaw Environmental has paid to
Bear Stearns aggregate fees equal to $1,500,000, and has agreed to pay
additional amounts to Bear Stearns (up to a maximum of $3,250,000).

Raymond James is acting as financial advisor to Laidlaw Environmental in
connection with its effort to acquire Safety-Kleen, for which services, and for
assistance rendered by Raymond James in connection with prior purchases of
Shares by Laidlaw Environmental, Laidlaw Environmental has agreed to pay Raymond
James aggregate fees up to a maximum of $1,000,000 (all of which is contingent
upon consummation of the Merger).

Laidlaw Environmental has also agreed to reimburse each of the financial
advisors for all out-of-pocket expenses incurred by such financial advisors
(including consultant and attorney's fees), and has agreed to indemnify each of
Bear Stearns and Raymond James and certain related persons and entities against
certain liabilities and expenses in connection with their respective
engagements, including certain liabilities under the federal securities laws. In
connection with each of Bear Stearns' and Raymond James' engagement, Laidlaw
Environmental anticipates that certain employees of Bear Stearns and Raymond
James may communicate in person, by telephone or otherwise with a limited number
of institutions, brokers or other persons who are Safety-Kleen Shareholders.
Neither Bear Stearns nor Raymond James will receive any fee for or in connection
with such solicitation activities by its employees apart from the fees it is
otherwise entitled to receive as described above.

In addition to the fees to be received by each of Bear Stearns and Raymond
James in connection with its engagement as financial advisor to Laidlaw
Environmental, Raymond James has in the past rendered various investment banking
and financial advisory services for Laidlaw Environmental for which it has
received customary compensation. Both Bear Stearns and Raymond James may in the
future render services to Laidlaw Environmental for which they will receive
customary fees.

Laidlaw Environmental has retained IBJ Schroder Bank & Trust Company
("Exchange Agent") to act as Exchange Agent in connection with the Offer.
Laidlaw Environmental will pay the Exchange Agent reasonable and customary
compensation for its services in connection with the Offer, plus reimbursement
for out-of-pocket expenses, and will indemnify the Exchange Agent against
certain liabilities and expenses in connection therewith, including liabilities
under the federal securities laws. Laidlaw Environmental will not pay any fees
or commissions to any broker or dealer or other person (other than the Dealer
Manager and the Information Agent) for soliciting tenders of Shares pursuant to
the Offer. Brokers, dealers, commercial banks and trust companies will be
reimbursed by Laidlaw Environmental for customary mailing and handling expenses
incurred by them in forwarding material to their customers.

ACCOUNTING TREATMENT

Laidlaw Environmental will account for the acquisition of Shares pursuant
to the Offer and the Merger using the purchase method of accounting.
Accordingly, the purchase price will be allocated to assets acquired and
liabilities assumed based on their estimated fair values at the acquisition
date. Safety-Kleen's financial position and results of operations will not be
included in Laidlaw Environmental's consolidated accounts prior to the
consummation date of the Merger.

STOCK EXCHANGE LISTING

The Laidlaw Environmental Common Stock (with accompanying Rights) is listed
on the NYSE and the Pacific Exchange, Inc. (the "Pacific Exchange"). Application
will be made to list the Laidlaw Environmental Common Stock to be issued
pursuant to the Offer and the Merger on the NYSE and the Pacific Exchange. As
described above under "The Offer -- Conditions of the Offer -- Laidlaw
Environmental Shareholder Ap-

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<PAGE> 56

proval Condition," pursuant to the rules of the NYSE, the issuance of Laidlaw
Environmental Common Stock in the Offer and the Merger must be approved by the
holders of a majority of the shares of Laidlaw Environmental voting stock,
voting as a single class, voted at a meeting of such holders at which the total
number of votes cast represents over 50% in interest of all shares of Laidlaw
Environmental voting stock outstanding on the applicable record date.

WISCONSIN STATE LAWS

Although Laidlaw Environmental and LES Acquisition consider it unlikely, it
is possible that the Offer may be subject to Chapter 552 of the Wisconsin
Statutes (the "Wisconsin Corporate Take-Over Law"). The Wisconsin Corporate
Take-Over Law makes it unlawful, under certain circumstances, for any person to
make a take-over offer involving a target company in Wisconsin, which meets
certain criteria, or to acquire any equity securities of such a target company
pursuant to the take-over offer, unless a registration statement has been filed
with the Wisconsin Division of Securities ten days prior to the commencement of
the take-over offer and has become effective or such take-over is exempted by
rule or order of the Wisconsin Division of Securities. The Wisconsin Corporate
Take-Over Law also imposes certain reporting and filing requirements on persons
making such a take-over offer and makes unlawful certain fraudulent and
deceptive practices, all of which provisions may be applicable to the Offer. The
applicability of the Wisconsin Corporate Take-Over Law depends on the percentage
of Safety-Kleen's outstanding common shares held of record by residents of
Wisconsin, which is not determinable with certainty from publicly available
information. Laidlaw Environmental and LES Acquisition have received from the
Wisconsin Division of Securities an exemption order permitting the Offer to be
made without prior registration, provided that no Shares will be purchased or
taken up pursuant to the Offer unless a registration is effective or
registration is found not to be required after the information necessary to make
this determination is obtained from Safety-Kleen. If it is found that compliance
is required, Laidlaw Environmental and LES Acquisition presently intend to
comply with the Wisconsin Corporate Take-Over Law, including making any required
filings. Laidlaw Environmental and LES Acquisition both have reserved their
rights to challenge the constitutionality of the Wisconsin Corporate Take-Over
Law or its applicability to them.

THE MERGER

GENERAL

If the Minimum Tender Condition is satisfied and other Offer Conditions are
satisfied (or waived, as applicable) and the Offer is consummated, Laidlaw
Environmental and its affiliates will own two-thirds of the outstanding Shares.
Accordingly, Laidlaw Environmental and its affiliates will at such time have
sufficient voting power in Safety-Kleen to approve the Merger independently of
the votes of any other Safety-Kleen Shareholders, and Laidlaw Environmental
presently intends to vote any and all Shares then owned by Laidlaw Environmental
and its affiliates to approve the Merger.

Rule 13e-3 of the General Rules and Regulations under the Exchange Act,
which Laidlaw Environmental does not believe would be applicable to the Merger
as long as the Merger occurred within one year of consummation of the Offer,
would require, among other things, that certain financial information concerning
Safety-Kleen, and certain information relating to the fairness of the proposed
transaction and the consideration offered to Safety-Kleen Shareholders therein,
be filed with the Commission and disclosed to Safety-Kleen Shareholders prior to
consummation of the Merger.

Laidlaw Environmental reserves the right to acquire, following the
consummation or termination of the Offer, additional Shares through open-market
purchases, privately negotiated transactions, a tender offer or exchange offer,
or otherwise, upon such terms and at such prices as it shall determine, which
may be more or less favorable than those of the Offer. Laidlaw Environmental and
its affiliates also reserve the right to dispose of any or all Shares acquired
by them pursuant to the Offer or otherwise, upon such terms and at such prices
as they shall determine.

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<PAGE> 57

In connection with the Offer, Laidlaw Environmental has reviewed, and will
continue to review, on the basis of available information, various possible
business strategies that it might consider in the event that it acquires all or
substantially all of the common equity interest in Safety-Kleen. Laidlaw
Environmental also intends to conduct a detailed review of Safety-Kleen and its
assets, corporate structure, capitalization, operations, properties, policies,
management and personnel and consider which changes, if any, would be desirable
in light of the circumstances which then exist. Such strategies could include,
among other things, changes in Safety-Kleen's business, corporate structure,
capitalization, the Safety-Kleen Board or management, and consideration of
disposition of certain assets or lines of business of Safety-Kleen.

If the Merger is consummated, Laidlaw Environmental will consider the sale
of two assets of Safety-Kleen after the Merger: (i) Safety-Kleen's European
operations and (ii) Safety-Kleen's oil recovery services business. Laidlaw
Environmental will fully assess these potential divestitures, and possibly other
potential divestitures, as additional information regarding Safety-Kleen becomes
available.

Except as noted herein, Laidlaw Environmental does not have any present
plans or proposals that would result in an extraordinary corporate transaction,
such as a merger, reorganization or liquidation, or sale or transfer of a
material amount of assets, involving Safety-Kleen or any of its subsidiaries, or
any material changes in Safety-Kleen's corporate structure or business. However,
because Laidlaw Environmental has not had access to Safety-Kleen's books and
records, additional changes may be made after a full review of Safety-Kleen's
operations is completed.

DISSENTER RIGHTS

Holders of Shares do not have appraisal rights as a result of the Offer.
However, in the event the Merger is consummated, the Safety-Kleen Shareholders
would have dissenter rights with respect to the Merger under the Wisconsin
Statutes Section 180.1302.

INFORMATION REGARDING SAFETY-KLEEN

The following information is taken from the Safety-Kleen Annual Report on
Form 10-K for the fiscal year ending December 28, 1996.

Safety-Kleen is a leader in servicing the recycling and waste needs of
companies in the automotive/retail repair, industrial, imaging and other
business sectors. Over 2,800 Safety-Kleen specialists service customers from a
branch network that extends across North America and Western Europe.

Focusing primarily on the needs of smaller businesses, Safety-Kleen
performed nearly five million individual services and reclaimed more than 300
million gallons of contaminated fluid through a network of 230 branches
worldwide in 1996. Safety-Kleen collects and recycles used products at thirteen
recycle centers, two lube oil re-refineries, and three fuel-blending facilities.

Safety-Kleen operates in the continental U.S., Canada, the United Kingdom,
the Republic of Ireland, Puerto Rico, Belgium, France, Italy, Spain and Germany.
Safety-Kleen has licensee operations in Japan and Korea. Safety-Kleen Corp. was
incorporated in July, 1963 under the laws of the State of Wisconsin.

INFORMATION REGARDING LAIDLAW ENVIRONMENTAL

The following describes the business and management of Laidlaw
Environmental. Additional information regarding Laidlaw Environmental is
contained in its filings with the Commission pursuant to the Exchange Act. See
"Available Information" and "Incorporation of Certain Documents by Reference."

BUSINESS OF LAIDLAW ENVIRONMENTAL

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<PAGE> 58

operates waste processing, recycling and repackaging facilities and has
analytical laboratories at its facilities in several states.

On May 15, 1997, pursuant to the February 6, 1997, stock purchase agreement
(the "Stock Purchase Agreement") between Rollins Environmental Services, Inc.
("Rollins") and Laidlaw Inc. ("Laidlaw"), Rollins acquired (the "Acquisition")
the hazardous and industrial waste operations of Laidlaw ("Old LESI" or the
"Accounting Acquirer"). The business combination was accounted for as a reverse
acquisition using the purchase method of accounting. Rollins issued 120 million
Common Shares and a $350 million 5% subordinated convertible debenture, and paid
$349.1 million in cash ($400 million, less debt of $50.9 million assumed), to
Laidlaw to consummate the Acquisition. Concurrent with the closing of the
Acquisition, the continuing legal entity changed its name from "Rollins
Environmental Services, Inc." to "Laidlaw Environmental Services, Inc." As a
result of the Acquisition, Laidlaw owns 67% of the issued common shares of
Laidlaw Environmental. Laidlaw Environmental accordingly adopted the Old LESI's
fiscal year-end of August 31.

Laidlaw Environmental, in providing hazardous and industrial waste
services, is engaged in five primary lines, or classes, of business: (a) service
center, (b) landfill, (c) incineration, (d) transportation and (e) specialty
services, including polychlorinated biphenyl ("PCB") management, wastewater
treatment and other specialty services.

The percentages of Laidlaw Environmental's gross revenue contributed by its
business classes for the last three fiscal years ended August 31, were as
follows:

<TABLE>
<CAPTION>
1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Service Centers............................................. 38% 39% 41%
Landfill.................................................... 22 25 21
Incineration................................................ 11 4 4
Transportation.............................................. 12 12 15
Specialty Services.......................................... 17 20 19
--- --- ---
Total Revenue..................................... 100% 100% 100%
=== === ===
</TABLE>

SERVICE CENTERS

Service centers across the United States and Canada work in partnership
with Laidlaw Environmental's treatment and disposal facilities to provide an
integrated service delivery system. Waste materials are transported from a
customer site to a service center, where they are temporarily stored or
consolidated with compatible waste streams for more efficient transportation to
final treatment and/or disposal destinations. All of Laidlaw Environmental's
service centers in the United States have Part B permits under the United States
Resource Conservation and Recovery Act ("RCRA") that, among other things, allow
Laidlaw Environmental to store waste for up to one year for bulking and/or
transfer purposes. Additionally, Laidlaw Environmental operates smaller
satellite locations which act as local collection points for the service
centers. Through its service center network, Laidlaw Environmental can access
its customers quickly in order to collect their waste streams, thus enabling
customers to remain in compliance with on-site storage regulations.

Laidlaw Environmental also has on-site field operations headquartered at
its service centers, including lab-packing services, field services and
household hazardous waste collection programs.

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<PAGE> 59

Laidlaw Environmental performs a variety of resource recovery processes at
many of its service centers. Resource recovery involves the distillation of used
solvents to remove contaminants and then the return of the material to the
market as a solvent or for use as fuel. Most of these hazardous materials come
from the aerospace and transportation industries and the metals finishing
industries. Fuel substitution, mainly, in the energy intensive cement
manufacturing process, is the most prevalent form of resource recovery.

LANDFILLS

Laidlaw Environmental operates 12 landfills located throughout the United
States and Canada. A total of eight landfills are designed and permitted for the
disposal of hazardous wastes. Four landfills are operated for non-hazardous
industrial waste disposal, and to a lesser extent, municipal solid waste.

Laidlaw Environmental operates eight of the 23 permitted hazardous waste
landfills in North America, with 52 million cubic yards of remaining permitted
capacity (which at current fill rates represents in excess of 50 years of
capacity). Of these facilities, six are located in the United States and two in
Canada.

In the United States, Laidlaw Environmental's hazardous waste landfills
have been issued RCRA Subtitle C permits. The EPA's permitting process for RCRA
Subtitle C landfills is very rigorous. Before a permit can be issued, the
applicant must provide detailed waste analysis, spill prevention and control
counter-measure plans, detailed design specifications (which include liner
design, leak detection systems and rainwater removal systems), groundwater
monitoring, employee training and geologic/hydrogeologic investigations.
Furthermore, the applicant must post financial assurance instruments for
landfill cell and site closure and post-closure care. All six of Laidlaw
Environmental's United States hazardous waste landfills have received Part B
landfill permits and meet or exceed Subtitle C requirements. These permits are
generally issued for periods of five or ten years, after which the permit must
be reviewed by state and/or federal regulators before the permit can be renewed
for additional terms. Management is not aware of any issues at any of Laidlaw
Environmental's sites that would preclude the renewal of its Part B landfill
permits. During the last 12 months, approximately 0.9 million cubic yards of
hazardous wastes were disposed of in these landfills.

In addition to its hazardous waste landfill sites, Laidlaw Environmental
operates four nonhazardous industrial landfills with over 209 million cubic
yards of remaining permitted capacity. Laidlaw Environmental's non-hazardous
landfill facilities are permitted to accept commercial industrial waste,
including wastes from foundries, demolition and construction, machine shops,
automobile manufacturing, printing, metal fabrications and recycling. Laidlaw
Environmental's facility in Carbon County, Utah also accepts municipal solid
waste. During the last 12 months, 1.4 million cubic yards of non-hazardous
wastes were disposed of in these landfills.

INCINERATION

Laidlaw Environmental offers a wide range of technological capabilities and
locations to customers through a collection of incineration facilities.
Incineration is the preferred method for the treatment of organic hazardous
waste, because it effectively destroys the contaminants at temperatures in
excess of 2,000 degrees Fahrenheit. High temperature incineration effectively
eliminates organic wastes such as herbicides, plastics, halogenated solvents,
pesticides, pharmaceutical and refinery wastes, regardless of whether they are
gases, liquids, sludges or solids. Federal and state incineration regulations
require a destruction and removal efficiency of 99.99% for most organic wastes
and 99.9999% for PCBs and dioxin.

Laidlaw Environmental operates four United States-based solids and liquids
capable incinerators with annual capacity of over 250,000 tons, two hazardous
waste liquid injection incinerators in Canada, and one in the United States, and
two lower volume specialty incineration facilities in the United States.

Laidlaw Environmental's incineration facilities in Bridgeport, New Jersey;
Deer Park, Texas; Coffeyville, Kansas; and Aragonite, Utah, are designed to
process liquid organic wastes, sludges, solids, soil and debris. The Deer Park
facility has two kilns and a rotary reactor. Additionally, the Deer Park
facility has an on-site landfill for the disposal of ash and other waste
material produced as a result of the incineration process. The landfill is built
and permitted to RCRA hazardous waste standards.

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<PAGE> 60

Laidlaw Environmental's incineration facilities in Roebuck, South Carolina,
Mercier, Quebec and Sarnia, Ontario are liquid injection incinerators, designed
primarily for the destruction of liquid organic waste. The Mercier facility also
has a system to blend and destroy pumpable sludges. Typical wastestreams include
wastewater containing concentrated organic levels not amenable to conventional
physical/chemical waste treatment, pesticide and herbicide waste, waste with
high chlorinated organic concentrations and flammable materials.

All but one of Laidlaw Environmental's United States incineration
facilities have received Part B permits under RCRA. The facility in Roebuck,
South Carolina has received EPA approval for that portion of the Part B permit
under EPA authority; however, the required state permit which was originally
issued in 1987 is currently under appeal. Part B permits are generally issued
for periods of five or ten years, after which the permit must be reviewed by
state and/or federal regulators before the permit can be renewed for additional
terms. Management is not aware of any issues at any of Laidlaw Environmental's
sites that would preclude the renewal of any of its Part B permits.

During fiscal year 1997, Laidlaw Environmental closed its incinerators at
Baton Rouge, Louisiana, and Clive, Utah, reducing utilization of less efficient
and redundant facilities. During fiscal year 1998, Laidlaw Environmental plans
to close its incinerators at Coffeyville, Kansas, and Roebuck, South Carolina,
reducing excess capacity. These four closures will eliminate approximately
244,000 tons of practical capacity from the off-site commercial incineration
market. The industry's total off-site commercial incinerator practical capacity
was estimated at 1.26 million tons in 1996, according to EI Digest.

TRANSPORTATION

Laidlaw Environmental's transportation operations facilitate the movement
of materials between locations, which is key to the operation of Laidlaw
Environmental's network of hazardous and industrial waste facilities.
Transportation may be accomplished by truck, rail, or other mode, with
company-owned assets or in conjunction with third-party transporters.

Specially designed containment systems, vehicles and other equipment
permitted for hazardous waste transport, along with drivers trained in
transportation skills and hazardous waste procedures, provide for the movement
of customer waste streams.

SPECIALTY SERVICES

Other specialty services provided by Laidlaw Environmental include PCB
management services, wastewater treatment, harbor and channel dredging, remedial
construction and consulting, industrial services, analytical services,
biological treatment, and paint and solvent recovery.

Laidlaw Environmental recycles PCB contaminated oils and reclaims metals
from PCB contaminated equipment. Laidlaw Environmental accomplishes this
recycling and reclamation through a de-chlorination process operated from seven
facilities mainly in the eastern United States and Canada.

Laidlaw Environmental provides field services for industrial customers at
their sites and at government installations, federal and state Superfund sites,
laboratories and schools across North America. These activities range from
typical environmental remediation and construction to specialized services.
Laidlaw Environmental recently adopted its INSITE program, an environmental
outsourcing program that allows companies to achieve their environmental goals
while focusing on their core business.

Laidlaw Environmental also offers a range of wastewater treatment
technology, facilities and customer services. Wastewater treatment is provided
from four facilities and consists of four basic business lines: hazardous
wastewater treatment, mobile treatment, sludge dewatering/drying and
nonhazardous wastewater treatment. These services include the reduction,
treatment and disposal of both hazardous and non-hazardous wastewater, sludges
and solids for both bulk and drummed waste. Laidlaw Environmental removes
hazardous components from hazardous industrial liquids and/or
chemically/physically makes hazardous industrial liquids non-hazardous through
blending and treatment technology. Specialized techniques reduce residues by

51
<PAGE> 61

recycling/reusing spent products. Batch treatment technologies also enable
Laidlaw Environmental to handle hard-to-treat wastewater streams.

Hazardous wastewater treatment involves the safe detoxification of
hazardous components from liquid waste streams. The hazardous properties are
neutralized (pH adjustment) and/or reduced to non-leachable state, through a
multistep treatment process. The resulting treated effluent is tested prior to
discharge to ensure compliance with discharge limits, while the sludge is
dewatered and tested to ensure that it meets the requirements for off-site
disposal as a nonhazardous waste. Because certain wastes carry hazardous waste
designation throughout the treatment system, these wastes are treated separately
to minimize dewatered sludge disposal costs. Laidlaw Environmental's wastewater
treatment facilities are fully-permitted and approved under applicable
regulations.

Mobile wastewater treatment and dewatering equipment is used to dewater
industrial sludges at the generators' sites. Turn-key services include
laboratory, trained operators, treatment supplies and equipment, dewatering and
stabilization technology -- all designed to provide optimal treatment chemistry
that reduces the volume of sludge generated for off-site disposal.

Sludge drying uses transportable equipment that reduces the amount of
entrained liquid in dewatered sludge. This process is particularly effective for
organic sludges that must be incinerated at high cost. Drying greatly reduces
ultimate disposal and transportation costs by minimizing the volume of waste
sent off-site for treatment.

Laidlaw Environmental treats non-hazardous waste streams at all of its
hazardous wastewater plants and operates a facility specifically designed for
non-hazardous wastewater and consumer goods destruction in Chattanooga,
Tennessee.

In connection with the Acquisition, Laidlaw Environmental's hazardous
wastewater facility in Nashville, Tennessee was closed in May of 1997.

COMPETITION

The hazardous and industrial waste management industry is highly
competitive. The sources of competition vary by locality and by type of service
rendered, with competition coming from the other major waste services companies
and thousands of privately owned firms in North America which offer waste
services. Laidlaw Environmental also competes with municipalities and larger
plants which provide their own waste services. In acquiring new contracts and
maintaining business, Laidlaw Environmental experiences competition primarily in
the areas of pricing and service.

Total hazardous waste industry revenues for 1995 were estimated to have
been approximately $3 billion. Prior to the Acquisition, Old LESI, Rollins and
three other large waste management companies accounted for 65% of the hazardous
waste management industry's revenues in 1995, according to EI Digest (October
1996). The pro forma combined revenues of Laidlaw Environmental for the year
ended August 31, 1996, would have given Laidlaw Environmental a 30% market share
of the hazardous waste industry revenues for 1995.

Service center competition consists of two companies with national coverage
providing varying forms of waste collection assets or facilities. A number of
companies also compete on a local and regional basis.

Ten of the 15 hazardous waste landfills not operated by Laidlaw
Environmental are operated by three competitors with landfill facilities spread
throughout the United States.

Competitors operate large-scale incinerators at eight locations throughout
North America. Other companies have applied for or received permits to construct
and operate hazardous waste incinerators. Competition is also encountered from
cement kilns, which use hazardous waste-derived fuel as a supplemental fuel
source.

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<PAGE> 62

CUSTOMERS

Laidlaw Environmental conducts business with more than 18,000 customers.
These customers represent diverse industries, including automotive manufacturers
and suppliers, chemical and petrochemical, computer and micro-processor
manufacturers, primary metals, paper, furniture, aerospace and pharmaceutical,
and are located throughout the United States and Canada. During fiscal 1997 no
one customer accounted for more than six percent of Laidlaw Environmental's
consolidated revenues.

The hazardous waste management business is cyclical to the extent that it
is dependent upon a stream of waste from cyclical industries. If those cyclical
industries slow significantly, the business that Laidlaw Environmental receives
from those industries is likely to slow.

SEASONALITY

Adverse winter weather moderately affects some of Laidlaw Environmental's
operations, particularly during the second fiscal quarters. The main reason for
this effect is reduced volumes of waste being received at Laidlaw
Environmental's facilities and higher operating costs associated with operating
in sub-freezing weather and high levels of snowfall.

REGULATIONS

The collection and disposal of solid and hazardous wastes are subject to
the laws and regulations promulgated by United States, Canadian or other
foreign, state, territorial, federal, provincial or local courts, executive
offices, legislatures, governmental agencies or ministries, commissions or
administrative, regulatory or self-regulatory authorities or instrumentalities
which regulate health, safety, the environment, zoning and land-use.
Environmental laws and regulations require hazardous waste disposal facilities
to obtain permits, which generally outline the procedures under which the
facilities must be operated. Governmental authorities have the power to enforce
compliance with these, regulations, and violations of permit conditions, or of
the regulations, even if unintentional, may result in fines, shutdowns, remedial
work or revocation of the permit. Regulations vary but generally govern
collection, storage and disposal activities and the location and use of
facilities and impose restrictions to prohibit or minimize air and water
pollution.

Laidlaw Environmental's business is significantly affected by federal,
state, provincial and local environmental law, including RCRA, the Toxic
Substances Control Act, CERCLA, the Clean Water Act and the Clean Air Act, and
corresponding state laws and related regulations and enforcement practices.
Safety standards under the Occupational Safety and Health Act are also
applicable to Laidlaw Environmental's business.

RCRA provides for the establishment of a national hazardous waste
management program through a comprehensive regulatory system. Among other
things, it defines hazardous wastes and provides standards for generators,
transporters and disposers of hazardous wastes, and for the issuance of permits
for sites where such material is treated, stored or disposed. These regulations
also require Laidlaw Environmental's facilities to demonstrate financial
assurance for sudden and accidental and, in the case of land based treatment
facilities, non-sudden and gradual pollution occurrences. Financial assurance
for future closure and post-closure expenses must also be maintained. Laidlaw
Environmental believes that each facility operating under interim status will be
issued its final RCRA permit and that each permit will be renewed at the end of
its existing term. However, any such issuance or renewal could include
conditions requiring further capital expenditures or corrective actions.
Although Laidlaw Environmental also believes that each of its operating
facilities complies in all material respects with the applicable requirements of
RCRA, it may be necessary to expend considerable time, effort and money to keep
existing or acquired facilities of Laidlaw Environmental in compliance with
applicable requirements, including new regulations, to maintain existing permits
and approvals and to obtain the permits and approvals necessary to increase
their capacity.

CERCLA, among other things, imposes financial liability for damages and the
cleanup of sites from which there is a release or threatened release of
hazardous substances into the environment. Present and past owners and operators
of sites which release hazardous substances, as well as generators and
transporters of the

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<PAGE> 63

waste material, are jointly and severally liable for remediation costs and
environmental damages. Given the substantial costs involved in a CERCLA cleanup
and the difficulty of obtaining insurance for environmental impairment
liability, such liability could have a material impact on Laidlaw
Environmental's business, financial condition and future prospects.

The Clean Water Act regulates the discharge of pollutants into surface
waters and sewers from a variety of sources, including disposal sites and
treatment facilities. Laidlaw Environmental is required to obtain discharge
permits and conduct sampling and monitoring programs. The Clean Air Act
regulates the emission of certain potentially harmful substances into the air.
These regulations also impact Laidlaw Environmental's operations. Laidlaw
Environmental believes each of its operating facilities complies in all material
respects with the applicable requirements.

ENVIRONMENTAL LIABILITIES AND CAPITAL EXPENDITURES

A portion of Laidlaw Environmental's capital expenditures are related to
compliance with environmental laws and regulations. Laidlaw Environmental
estimates capital spending of approximately $1 million for fiscal year 1998, and
$3 million in the aggregate for the fiscal years 1999 through 2001 in order to
comply with RCRA, the Clean Air Act and other environmental laws and regulations
currently in effect.

In addition to these capital expenditures, Laidlaw Environmental may incur
costs in connection with closure activities at certain of its sites. When
Laidlaw Environmental discontinues using or changes the use of a hazardous waste
management unit, formal closure procedures must be followed, and such procedures
must be approved by federal or state environmental authorities. In some cases,
costs are incurred to complete remedial cleanup work at the site. In addition at
certain of Laidlaw Environmental's other operating sites, remedial cleanup work
is required as part of the RCRA Corrective Action Program or other state and
federal programs. As shown in Laidlaw Environmental's Consolidated Balance Sheet
and more fully described in Note 6 of the Notes to Consolidated Financial
Statements, incorporated herein by reference, Laidlaw Environmental has recorded
liabilities of $183.1 million as of August 31, 1997, for remedial cleanup work,
Superfund site liability, closure activities and certain other environmental
expenses related to its operating and previously closed sites.

With respect to various operating facilities, Laidlaw Environmental is
required to provide financial assurance with respect to certain statutorily
required closure and post-closure obligations totaling $450 million at August
31, 1997. Historically, Laidlaw provided certain of these financial assurances
in the form of parental guaranties. As a result of the Acquisition, Laidlaw
Environmental will be obligated to provide most of these financial assurances.
Laidlaw Environmental intends to provide the required financial assurance
through a combination of letters of credit and insurance policies, as allowed by
the applicable regulatory authorities.

EMPLOYEES

As of August 31, 1997, 4,500 employees provided Laidlaw Environmental's
hazardous waste services, of whom 1,500 were executive, supervisory, clerical
and sales personnel. Approximately 12% of Laidlaw Environmental's employees were
represented by various collective bargaining groups. Management believes that
its relations with its employees are excellent.

MANAGEMENT

Certain information regarding the directors and executive officers of
Laidlaw Environmental is set forth on Schedule A annexed hereto.

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<PAGE> 64

UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

The following selected unaudited pro forma combined financial information
combines the consolidated balance sheets and income statements of Laidlaw
Environmental and Safety-Kleen as if the Offer, the Merger and the other
transactions described herein had occurred for all periods presented. These
statements are prepared on the basis of accounting for the Merger as a purchase
and are based on the assumptions set forth in the notes thereto. These
statements do not reflect the estimated cost savings of approximately $100 to
$130 million Laidlaw Environmental believes will result from the Merger. This
information should be read in conjunction with and is qualified in its entirety
by the consolidated financial statements and accompanying notes of Laidlaw
Environmental and Safety-Kleen included in the documents described under
"Incorporation of Certain Documents by Reference" (but which, in the case of
Safety-Kleen, are not covered by the reports of Safety-Kleen's independent
accountants for purposes of this Prospectus) and the pro forma accompanying
discussion and notes set forth under this Section.

The following information is being presented for illustrative purposes only
and is not necessarily indicative of the financial position or operating results
that would have occurred had the transactions assumed herein been consummated at
the beginning of the periods for which the transactions are being given effect,
nor is it necessarily indicative of future operating results or financial
position.

LAIDLAW ENVIRONMENTAL AND SAFETY-KLEEN

PRO FORMA COMBINED STATEMENT OF INCOME
FOR THE YEAR ENDED AUGUST 31, 1997

<TABLE>
<CAPTION>
HISTORICAL HISTORICAL PRO FORMA ADJUSTMENTS
LAIDLAW SAFETY- --------------------- PRO FORMA
ENVIRONMENTAL KLEEN DR CR COMBINED
------------- ---------- -------- ------- ----------
(UNAUDITED)
($ IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
Revenues......................... $ 678,619 $977,122 $ -- $ -- $1,655,741
Expenses:
Operating...................... 485,062 645,488 -- -- 1,130,550
Depreciation and
amortization................ 53,506 77,741 33,722(D1) -- 164,969
Selling, general and
administrative.............. 73,068 137,961 -- -- 211,029
Restructuring charge........... 331,697 -- -- -- 331,697
--------- -------- -------- ------- ----------
Total expenses......... 943,333 861,190 33,722 -- 1,838,245
--------- -------- -------- ------- ----------
Operating income (loss).......... (264,714) 115,932 33,722 -- (182,504)
Allocated interest expense....... 24,030 -- -- -- 24,030
Interest expense................. 20,243 18,504 85,136(D2) -- 123,883
Other income..................... 2,865 1,587 -- -- 4,452
--------- -------- -------- ------- ----------
Income (loss) from continuing
operations before income tax... (306,122) 99,015 118,858 (325,965)
Income tax expense (benefit)..... (122,789) 38,294 -- 47,011(D3) (131,506)
--------- -------- -------- ------- ----------
Income (loss) from continuing
operations before minority
interest....................... (183,333) 60,721 118,858 47,011 (194,459)
Minority interest (net of tax)... (119) -- -- -- (119)
--------- -------- -------- ------- ----------
Income (loss) from continuing
operations..................... (183,452) 60,721 118,858 47,011 (194,578)
Income from discontinued
operations (net of tax)........ 20 -- -- -- 20
--------- -------- -------- ------- ----------
Net income (loss)...... $(183,432) $ 60,721 $118,858 $47,011 $ (194,558)
========= ======== ======== ======= ==========
Net income (loss) per share (Note
D5)............................ $ (1.329) $ (0.616)
Weighted average common and
common stock equivalents
outstanding (000s)............. 138,033 315,878(D4)
</TABLE>

See Accompanying Notes to Unaudited Pro Forma Combined Financial Information.

55
<PAGE> 65

LAIDLAW ENVIRONMENTAL SERVICES, INC.

PRO FORMA COMBINED BALANCE SHEET
AS OF AUGUST 31, 1997

<TABLE>
<CAPTION>
HISTORICAL HISTORICAL PRO FORMA ADJUSTMENTS
LAIDLAW SAFETY- --------------------------- PRO FORMA
ENVIRONMENTAL KLEEN DR CR COMBINED
------------- ---------- ---------- ---------- ----------
(UNAUDITED)
($ IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
ASSETS
Current assets
Cash and cash equivalents.......... $ 11,160 $ 13,273 $ -- $ -- $ 24,433
Trade and other accounts
receivable....................... 210,914 141,597 -- -- 352,511
Inventories........................ 7,927 48,853 -- -- 56,780
Other current assets............... 21,539 36,658 -- -- 58,197
---------- ---------- ---------- ---------- ----------
Total current assets........ 251,540 240,381 -- -- 491,921
---------- ---------- ---------- ---------- ----------
Property, plant and equipment, net... 1,236,569 629,561 1,295,644(D6) -- 3,161,774
Goodwill............................. 70,527 136,479 537,965(D7) -- 744,971
Other assets......................... 52,242 30,771 6,636(D8) 76,377
---------- ---------- ---------- ---------- ----------
Total assets................ $1,610,878 $1,037,192 $1,833,609 $ 6,636 $4,475,043
========== ========== ========== ========== ==========

LIABILITIES
Current liabilities
Accounts payable................... $ 48,148 $ 63,563 $ $ $ 111,711
Accrued liabilities................ 115,211 102,023 -- -- 217,234
Current portion of long-term
debt............................. 12,086 -- -- 71,914(D10) 84,000
---------- ---------- ---------- ---------- ----------
Total current liabilities... 175,445 165,586 -- 71,914 412,945
---------- ---------- ---------- ---------- ----------
Deferred items Income taxes.......... 49,790 57,361 518,258(D14) $ 625,409
Other.............................. 179,668 72,447 -- 252,115
Long-term debt....................... 528,010 246,080 -- 865,525(D10) 1,639,615
Subordinated convertible debenture... 350,000 -- -- 350,000
---------- ---------- ---------- ---------- ----------
Total liabilities........... 1,282,913 541,474 1,455,697 3,280,084

STOCKHOLDERS' EQUITY
Common stock......................... 180,435 5,839 -- 172,006(D11) 358,280
Additional paid-in capital........... 385,200 194,977 -- 494,172(D12) 1,074,349
Retained earnings (accumulated
deficit)........................... (237,670) 294,902 294,902(D13) -- (237,670)
---------- ---------- ---------- ---------- ----------
Total stockholders'
equity.................... 327,965 495,718 294,902 666,178 1,194,959
---------- ---------- ---------- ---------- ----------
Total liabilities and
stockholders' equity...... $1,610,878 $1,037,192 $ 294,902 $2,121,875 $4,475,043
========== ========== ========== ========== ==========
</TABLE>

See Accompanying Notes to Unaudited Pro Forma Combined Financial Information.

56
<PAGE> 66

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

A. SUMMARY OF OFFER

Laidlaw Environmental hereby offers, upon the terms and subject to the
conditions set forth herein and in the related Letter of Transmittal, to
exchange the Offer Consideration for each outstanding Share validly tendered on
or prior to the Expiration Date and not properly withdrawn. The Offer
Consideration per share consists of $15.00 net in cash (subject to adjustment)
and that number of shares of Laidlaw Environmental Common Stock equal to the
Exchange Ratio. The cash portion will be reduced by any termination fees or
expenses and incremental costs, such as new severance arrangements and other
expenses, Safety-Kleen may have incurred in connection with its Buyout Merger
Agreement. "Exchange Ratio" means the quotient (rounded to the nearest
1/100,000) determined by dividing $15.00 by the weighted average trading prices
for Laidlaw Environmental Common Stock (as reported on the New York Stock
Exchange, Inc. (the "NYSE") Composite Transactions reporting system as published
in The Wall Street Journal or, if not published therein, in another
authoritative source) (the "Laidlaw Environmental Average Price") for ten NYSE
trading days (each, a "Trading Day") selected by lot from the twenty Trading
Days ending three business days immediately prior to the Expiration Date,
provided, that the Exchange Ratio shall not be less than 2.80 nor greater than
3.50. Accordingly, subject to changes in the actual market value of Laidlaw
Environmental Common Stock on the date that Shares are actually exchanged, each
Share will be exchanged for (in addition to the Cash Consideration) Laidlaw
Environmental Common Stock having a market value of $15.00 if the Laidlaw
Environmental Average Price is between $4.28571 and $5.35714. If the Laidlaw
Environmental Average Price is greater than $5.35714, each Share will be
exchanged for (in addition to the Cash Consideration) Laidlaw Environmental
Common Stock having a market value of more than $15.00, and, conversely, if the
Laidlaw Environmental Average Price is less than $4.28571, each Share will be
exchanged for (in addition to the Cash Consideration) Laidlaw Environmental
Common Stock having a market value of less than $15.00, in each case subject to
changes in the actual market value of Laidlaw Environmental Common Stock on the
date that Shares are actually exchanged. Cash will be paid in lieu of any
fractional shares of Laidlaw Environmental Common Stock. See "The Offer -- The
Exchange Ratio."

According to the Safety-Kleen Form 10-Q for the period ended September 6,
1997, as of September 6, 1997, there were 58,400,729 Shares outstanding. Laidlaw
Environmental beneficially owns 601,100 Shares, or approximately 1.03% of the
outstanding Shares.

In contemplation of the Merger, Laidlaw has received a commitment letter
from The Toronto Dominion Bank (the "Agent") to provide the Credit Facilities.
The Credit Facilities will consist of four parts: (i) a $400,000,000 6-year
Senior Secured Revolving Credit Facility with a $200,000,000 letter of credit
sublimit (the "Revolving Credit Facility" or "Facility A"), (ii) a $500,000,000
6-year Senior Secured Amortizing Term Loan ("Facility B"), (iii) a $450,000,000
Minimally Amortizing 7-year Senior Secured Term Loan ("Facility C") and (iv) a
$450,000,000 Minimally Amortizing 8-year Senior Secured Term Loan ("Facility
D"); (Facility B, Facility C and Facility D, collectively, the "Term Loans").
The Credit Facilities will be secured by all of the tangible assets of the
combined companies to the extent required by the syndicate of banks and other
financial institutions (collectively, the "Lenders") acceptable to Laidlaw
Environmental and the Agent that will make the loans pursuant to the Credit
Facilities. All of the capital stock of Laidlaw Environmental's subsidiaries,
including the acquired Safety-Kleen subsidiaries, will be pledged as part of
such security for the Credit Facilities, and such subsidiaries will guaranty the
obligations of Laidlaw Environmental to the Lenders. The Term Loans will be
drawn in full on the closing date. The Revolving Credit Facility will be
available commencing on the closing date at which time $200,000,000 will be
available for letters of credit and $250,000,000 will be available for loans,
subject to an aggregate maximum of $400,000,000. Interest per annum on the
Credit Facilities will vary depending on the particular Credit Facility, whether
Laidlaw Environmental chooses to borrow under Eurodollar or non-Eurodollar loans
and, with respect to Facilities A and B the current total leverage ratio. Under
the terms of the Credit Facilities, Laidlaw Environmental will be required to
use interest rate swaps to manage the risk of interest rate fluctuations. The
terms of such interest rate swaps have not been established.

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<PAGE> 67

B. ACCOUNTING TREATMENT ($ IN THOUSANDS)

If the Merger is consummated, it will be accounted for using the purchase
method of accounting applied in accordance with generally accepted accounting
principles. Accordingly, the assets and liabilities of Safety-Kleen will be
recorded at their estimated fair value, with any difference between the amount
of such fair value and the purchase price being recorded as goodwill. The
operating results of the combined company will include the results of operations
of Safety-Kleen from and after the closing date.

The aggregate merger purchase price totals $1,804,433 and is comprised as
follows:

<TABLE>
<S> <C> <C>
Safety-Kleen Shares outstanding at September 6, 1997
according to Safety-Kleen's September 6, 1997 Form 10-Q... 58,400,729
Safety-Kleen Shares previously acquired by Laidlaw
Environmental............................................. (601,100)
----------
Safety-Kleen Shares remaining to acquire.................... 57,799,629
----------
Cash cost at $15.00 per Safety-Kleen Share.................. $ 866,994
Cost of additional Laidlaw Environmental Shares to be
issued:
Number of Laidlaw Environmental Shares to be issued......... 177,844,924
Price per Share........................................... $4.875
Total cost........................................ 866,994
----------
1,733,988
Cost of Safety-Kleen Shares previously acquired by Laidlaw
Environmental............................................. 13,000
Cost of "in-the-money" Safety-Kleen stock options that are
assumed to fully vest..................................... 57,445
----------
Total merger purchase price....................... $1,804,433
==========
</TABLE>

The price per share of the additional Laidlaw Environmental shares to be
issued of $4.875 is the average of the closing NYSE market price for the five
trading days before November 20, 1997, the date of the public announcement of
Laidlaw Environmental's intention to make the Offer.

The purchase price has been allocated to the assets acquired and
liabilities assumed based on estimated fair values at August 31, 1997, as
follows:

<TABLE>
<S> <C>
Current assets.............................................. $ 240,381
Property, plant and equipment............................... 1,925,205
Goodwill.................................................... 674,444
Other assets................................................ 24,135
Current liabilities......................................... (165,586)
Deferred income taxes....................................... (575,619)
Other deferred items........................................ (72,447)
Long-term debt.............................................. (246,080)
----------
Merger purchase price....................................... $1,804,433
==========
</TABLE>

C. BASIS OF PRESENTATION

The accompanying unaudited pro forma combined balance sheet gives effect to
the Offer, the Merger and the other transactions described herein as if they had
occurred on August 31, 1997. The unaudited pro forma combined statement of
income for the year ended August 31, 1997 gives effect to the Offer, the Merger
and the other transactions described herein as if they had occurred as of
September 1, 1996. During the report periods there were no material transactions
between Laidlaw Environmental and Safety-Kleen.

The unaudited pro forma combined balance sheet at August 31, 1997
includes the balance sheet of Laidlaw Environmental at August 31, 1997 and the
balance sheet of Safety-Kleen at September 6, 1997. The unaudited pro forma
combined statement of income for the year ended August 31, 1997 includes Laidlaw
Environmental for the year ended August 31, 1997 and for Safety-Kleen the
aggregate of the 16 weeks ended

58
<PAGE> 68

December 28, 1996 plus the 36 weeks ended September 6, 1997. Because
Safety-Kleen does not report depreciation and amortization expense in its
unaudited interim financial statements, Laidlaw Environmental's management has
estimated Safety-Kleen's historical depreciation and amortization expense for
this period.

The effects of the Merger have been presented using the purchase method of
accounting. Accordingly, the purchase price was allocated to the assets acquired
and liabilities assumed based upon management's best preliminary estimate of
their fair values, based upon publicly available documents and information. The
preliminary allocation of the purchase price will be subject to further
adjustments, as Laidlaw Environmental finalizes the allocation of the purchase
price in accordance with generally accepted accounting principles. The goodwill
acquired is being amortized over 40 years on a straight-line basis.

The unaudited combined pro forma financial information does not purport to
be indicative of the combined financial position or combined results of
operations of Laidlaw Environmental and Safety-Kleen had the transactions
assumed therein occurred on the dates specified, nor are they indicative of
future financial position or results of operations. The unaudited pro forma
financial information does not give effect to potential cost savings of
approximately $100 to $130 million that Laidlaw Environmental management
believes may be realized as a result of the Merger. There can be no assurances
that such cost savings, if any, will be achieved.

The unaudited pro forma financial information should be read in conjunction
with the historical consolidated financial statements of Laidlaw Environmental
and the notes thereto and the historical consolidated financial statements of
Safety-Kleen and the notes thereto included elsewhere herein.

D. PRO FORMA ADJUSTMENTS ($ AND SHARES IN THOUSANDS)

The following adjustments and elimination entries have been made to the
unaudited pro forma combined statement of income to reflect the acquisition of
Safety-Kleen by Laidlaw Environmental using the purchase method of accounting
for the Merger:

1. To adjust depreciation and amortization expense to reflect the fair
value adjustment of property, plant and equipment and the effect of the
Merger on goodwill amortization, as follows:

<S> <C>
To eliminate Safety-Kleen's estimated historical intangible
and other asset amortization expense...................... $(15,531)
To record amortization expense related to goodwill arising
as a result of the Merger................................. 16,861
To record depreciation expense related to certain
Safety-Kleen property, plant and equipment written up to
estimated fair value...................................... 32,392
--------
Total adjustment.................................. $ 33,722
========
</TABLE>

2. To adjust interest expense for the impact of the additional
long-term debt associated with the Merger, as follows:

<S> <C>
To eliminate historical Safety-Kleen interest expense....... $(18,504)
To record interest expense on $1,183,519(1) of borrowings at
8.76%(2) under the Senior Credit Facilities............... 103,640
--------
Total adjustment.................................. $ 85,136
========
</TABLE>

- ---------------

(1) Includes additional long-term debt associated with Merger (Note D10)
and anticipated refinancing of Safety-Kleen historical long-term
debt.
(2) At current rates pursuant to the terms of the Senior Credit
Facilities.

3. To adjust income taxes (benefits) to record the pro forma income
taxes (benefits) as computed under SFAS 109 on pro forma pre-tax income
(loss).

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<PAGE> 69

4. Pro forma weighted average common and common stock equivalents
outstanding comprise:

<TABLE>
<S> <C>
Laidlaw Environmental weighted average historical for year
ended August 31, 1997..................................... 138,033
Additional Laidlaw Environmental shares to be issued in
connection with the Merger (see Note B)................... 177,845
-------
Pro forma total................................... 315,878
=======
</TABLE>

5. Fully diluted earnings per share amounts, which would include the
dilutive effect of the subordinated convertible debenture, have not been
included as the effect of such inclusion would be to increase earnings per
share, and thus be anti-dilutive.

The following adjustments and elimination have been made to the
unaudited pro forma combined balance sheet to reflect the acquisition of
Safety-Kleen by Laidlaw Environmental using the purchase method of
accounting for the Merger:

6. To writeup certain Safety-Kleen property, plant and equipment to
fair value.

7. To eliminate the historical book value of Safety-Kleen's intangible
assets and record the goodwill resulting from the Merger as follows:

<TABLE>
<S> <C>
Eliminate historical Safety-Kleen intangible assets......... $(136,479)
Record goodwill arising from the Merger (See Note A)........ 674,444
---------
Net goodwill adjustment........................... $ 537,965
=========
</TABLE>

8. To write-off the estimated book value of Safety-Kleen's other
assets.

9. Laidlaw Environmental's management estimates that approximately
$100 million of costs related to facility closures, severance costs and
other direct acquisition costs would be incurred in connection with the
Merger; these estimates of costs are not yet based on sufficient factual
information so as to be included as pro forma adjustments and are subject
to change as additional information becomes available.

10. To record the additional long-term debt associated with the Merger
(see Note B), as follows:

<TABLE>
<S> <C>
Cash component of acquiring outstanding Safety-Kleen
shares.................................................... $866,994
Cost of Safety-Kleen shares previously acquired............. 13,000
Cost of stock options....................................... 57,445
--------
Total long-term debt adjustment............................. $937,439
Less: current portion adjustment............................ (71,914)
--------
Net long-term debt adjustment..................... $865,525
========
</TABLE>

11. To record the additional common stock associated with the Merger,
as follows:

<TABLE>
<S> <C>
Eliminate historical Safety-Kleen common stock.............. $ (5,839)
Issuance of additional Laidlaw Environmental common stock
(Note B).................................................. 177,845
--------
Total common stock adjustment..................... $172,006
========
</TABLE>

12. To record the impact on additional paid-in capital associated with
the Merger, as follows:

<TABLE>
<S> <C>
Eliminate historical Safety-Kleen additional paid-in
capital................................................... $(194,977)
Issuance of additional Laidlaw Environmental common stock
(Note B).................................................. 689,149
---------
Total additional historical paid-in capital
adjustment...................................... $ 494,172
=========
</TABLE>

13. To eliminate historical Safety-Kleen retained earnings.

14. To record the incremental change in the Laidlaw Environmental tax
liability and benefit which results from the adjustment of certain assets
and the recording of certain liabilities utilizing the Federal statutory
rate of 35% plus an effective state rate of 5%.

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<PAGE> 70

E. ADDITIONAL ACQUISITION PRO FORMA INFORMATION

As disclosed in "Prospectus Summary -- Laidlaw Environmental Business,"
Rollins Environmental Services, Inc. ("Rollins"), on May 15, 1997, acquired the
hazardous and industrial waste operations of Laidlaw. As a result of this
acquisition being accounted for as a reverse acquisition, the historical
financial information of Laidlaw Environmental included in this unaudited pro
forma combined financial information is that of the accounting acquirer, Old
LESI, and includes the results of operations of Rollins from the date of
acquisition, May 15, 1997.

Condensed unaudited pro forma combined statement of income data, as if this
reverse acquisition, the Offer, the Merger and the other transactions described
herein had occurred as of September 1, 1996, is as follows ($ in thousands,
except per share amounts):

<TABLE>
<CAPTION>
YEAR ENDED
AUGUST 31, 1997
---------------
<S> <C>
Revenue..................................................... $1,802,627
Income (loss) from continuing operations.................... (233,288)
Income (loss) from discontinued operations.................. 20
Net income (loss)........................................... $ (233,268)
Per share data:
Income (loss) from continuing operations.................. $ (0.644)
Income (loss) from discontinued operations................ .000
Net income (loss)......................................... $ (0.644)
Weighted average common and common stock equivalents
(000)..................................................... 362,289
</TABLE>

DESCRIPTION OF LAIDLAW ENVIRONMENTAL CAPITAL STOCK

The authorized capital stock of Laidlaw Environmental consists of
350,000,000 shares of Laidlaw Environmental Common Stock, par value $1.00 per
share, and 1,000,000 shares of Laidlaw Environmental Preferred Stock, par value
$1.00 per share (the "Laidlaw Environmental Preferred Stock").

LAIDLAW ENVIRONMENTAL COMMON STOCK

As of October 14, 1997, there were 180,549,911 shares of Laidlaw
Environmental Common Stock issued and outstanding. Laidlaw Environmental is
authorized to issue 350,000,000 shares of Laidlaw Environmental Common Stock. In
connection with the Offer, Laidlaw Environmental will seek approval from its
shareholders to increase the amount of authorized shares of Laidlaw
Environmental Common Stock to 750,000,000 shares. The holders of Laidlaw
Environmental Common Stock are entitled to one vote per share on all matters
requiring stockholder action. The holders of the Laidlaw Environmental Common
Stock participate ratably in liquidation, subject to the payment to the holders
of any outstanding class of Laidlaw Environmental Preferred Stock of the
preferential amounts to which they are entitled.

Dividends on the Laidlaw Environmental Common Stock may be declared and
paid only out of surplus or net profits legally available for the payment of
dividends.

LAIDLAW ENVIRONMENTAL PREFERRED STOCK

Laidlaw Environmental is authorized to issue 1,000,000 shares of Laidlaw
Environmental Preferred Stock, which may be issued from time to time in one or
more series, each such series to have such distinctive designation or title as
may be fixed by the Laidlaw Environmental Board of Directors prior to the
issuance of any shares thereof. Each series may differ from each other series
already outstanding as may be declared from time to time by the Laidlaw
Environmental Board of Directors in the following respects: (i) the rate of
dividend; (ii) the amount per share, if any, which the Laidlaw Environmental
Preferred Stock shall be entitled to receive upon redemption, liquidation,
distribution or sale of assets, dissolution or winding up of Laidlaw
Environmental; (iii) terms and conditions of conversions, if any; and (iv) terms
of sinking fund, redemption or

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<PAGE> 71

purchase account, if any. As of November 10, 1997, Laidlaw Environmental had no
Laidlaw Environmental Preferred Stock outstanding.

COMPARISON OF THE RIGHTS OF HOLDERS OF SHARES
AND LAIDLAW ENVIRONMENTAL COMMON STOCK

As a consequence of the exchange of Shares for shares of Laidlaw
Environmental Common Stock in the Offer and the cancellation of Shares as a
result of the Merger, shareholders of Safety-Kleen, a company incorporated under
the laws of the State of Wisconsin, would become shareholders of Laidlaw
Environmental, a Delaware corporation. The rights of Safety-Kleen Shareholders
are currently governed by Wisconsin law (including the Wisconsin Statutes), the
Safety-Kleen Articles and the Safety-Kleen By-Laws. Upon the exchange of Shares
for Laidlaw Environmental Common Stock, the rights of Safety-Kleen Shareholders
will be governed by Delaware law (including the DGCL), the Laidlaw Environmental
Certificate and the Laidlaw Environmental By-laws.

The following is a summary of certain similarities and material differences
between the rights of holders of Shares and the rights of holders of Laidlaw
Environmental Common Stock. The following summary does not purport to be a
complete statement of the rights of Safety-Kleen Shareholders under Wisconsin
law, the Safety-Kleen Articles, the Safety-Kleen By-Laws and the Rights
Agreement as compared with the rights of Laidlaw Environmental stockholders
under Delaware law, the Laidlaw Environmental Certificate and the Laidlaw
Environmental By-laws, or a complete description of the specific provisions
referred to herein. The summary discusses certain material aspects of the
above-mentioned corporate laws and instruments but is qualified in its entirety
by reference to such laws and instruments, including the aforementioned
instruments of Safety-Kleen and Laidlaw Environmental. Complete copies of all
such laws and instruments may be obtained in the manner set forth above under
the caption "Available Information."

COMPARISONS OF DELAWARE AND WISCONSIN LAW -- SIMILARITIES

Modern corporation laws have evolved to the point where the laws of most
states contain substantially similar provisions regarding major features of
corporate existence. Certain relevant similarities between the DGCL and the
Wisconsin Statutes are described below:

Classified Board of Directors; Removal of Directors. Both the DGCL
and the Wisconsin Statutes allow the Board of Directors to be divided into
two or three classes. Under the DGCL, absent a provision to the contrary in
a corporation's certificate of incorporation, directors on a classified
board can be removed only for cause. The Wisconsin Statutes allow for the
removal of directors on a classified board with or without cause unless the
articles of incorporation or by-laws provide that the directors may be
removed only for cause.

Pursuant to the Laidlaw Environmental Certificate, Laidlaw
Environmental's Board of Directors is divided into three classes, with each
class serving a three-year term. Any director of Laidlaw Environmental may
be removed at any time by the stockholders, but only for cause, and only at
a meeting of the stockholders called for that purpose by the affirmative
vote of the holders of 75% or more of the Shares of Laidlaw Environmental
entitled to vote at an election of directors. The Safety-Kleen Articles
provide that the Safety-Kleen Board of Directors will be divided into three
classes, with each class serving a three-year term. Safety-Kleen directors
may be removed only for cause and only by a vote of holders of not less
than two-thirds of the issued and outstanding shares of Safety-Kleen.

Preferred Stock. The DGCL permits the Board of Directors to decrease
the number of authorized shares of any series of preferred stock (but not
below the number of shares then outstanding). The Wisconsin Statutes,
however, do not permit a Board of Directors to decrease the number of
shares in a series of preferred stock.

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<PAGE> 72

Laidlaw Environmental has one million shares of "blank check"
preferred stock authorized, none of which is issued. Safety-Kleen has one
million shares of "blank check" preferred stock authorized, none of which
(according to Safety-Kleen's public filings) is issued.

Required Vote for Authorization of Certain Actions. Both the DGCL and
the Wisconsin Statutes permit the authorization of a merger, dissolution or
disposition of substantially all the assets of corporations by the holders
of a majority of the outstanding shares of capital stock entitled to vote.
Under the Wisconsin Statutes, this majority shareholder vote also applies
to a share exchange.

Pursuant to the Laidlaw Environmental Certificate, any merger, sale,
lease, exchange, transfer or other disposition of assets of Laidlaw
Environmental having an aggregate fair market value of $5,000,000, or the
issuance of securities of Laidlaw Environmental having an aggregate fair
market value of $5,000,000, shall, if such transaction is to be consummated
with an "Interested Stockholder," require the affirmative vote of not less
than 75% of the outstanding Common Stock of Laidlaw Environmental. For
purposes of the Laidlaw Environmental Certificate, an "Interested
Stockholder" is a stockholder that owns, or upon consummation of the
transaction, will own, in excess of 30% of the voting securities of Laidlaw
Environmental, or is an affiliate of Laidlaw Environmental and at any time
within two years prior to the date of the transaction was a beneficial
owner of not less than 20% of the voting securities of Laidlaw
Environmental. Pursuant to the Safety-Kleen Articles, the affirmative vote
of not less than two-thirds of all outstanding voting securities of
Safety-Kleen is required for any merger, consolidation, sale, lease,
exchange or other disposition of all or substantially all of the property
or assets of Safety-Kleen.

Shareholder Action by Consent. Under the DGCL, unless the certificate
of incorporation provides otherwise, any action which may be taken by the
stockholders at a meeting may also be taken without a meeting by written
consent of the holders of such number of shares as, if present at a
meeting, could have so acted by vote. Under the Wisconsin Statutes,
shareholders may take action without a meeting by unanimous written
consent, or, if a Wisconsin corporation so elects in its articles of
incorporation, by less than unanimous written consent.

The Laidlaw Environmental By-Laws specifically deny stockholders the
right to take action without a meeting by written consent. The Safety-Kleen
Articles do not permit action by written consent of the shareholders with
less than unanimous written consent, and accordingly action by written
consent of the shareholders of Safety-Kleen would require unanimous
consent.

Interested Director Transactions. Under both the DGCL and the
Wisconsin Statutes, contracts or transactions in which one or more of the
corporation's directors has an interest are not void or voidable solely
because of such interest or because such director was present at the
directors' or shareholders' meeting where such contract or transaction was
approved, if certain conditions are met. Under the laws of both Wisconsin
and Delaware, if the director's interest is fully disclosed and a vote is
taken in good faith, such contracts or transactions may be approved by a
majority vote of the shareholders (excluding under the Wisconsin Statutes
shares held by the interested director or entities controlled by the
interested director) or of the disinterested directors. If the contracts or
transactions are shown to be fair and reasonable as to the corporation at
the time that they are authorized, approved or ratified by the board of
directors, then separate shareholder or disinterested director approval is
not required.

Under the DGCL, a quorum for a separate determination by the board is
a majority of the total number of directors, with the interested director
counted for purposes of determining whether a quorum exists. Under
Wisconsin Statutes, a quorum is deemed to exist if a majority of directors
who have no interest in the transaction vote to authorize it; no separate
quorum determination is made. Finally, under Wisconsin Statutes shares
owned by or voted under control of an interested director or an entity in
which the interested director has a material financial interest or of which
he or she is a general partner may not be "counted" for purposes of a
shareholder vote respecting the transaction in which the director has an
interest.

Indemnification of Directors and Officers. Under the DGCL,
indemnification provisions are strictly elective. The Wisconsin Statutes
provides for mandatory indemnification of a director or officer against

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<PAGE> 73

certain liabilities and expenses (i) to the extent such officers or
directors are successful in the defense of a proceeding (whether brought in
the name of the corporation or by a third party) and (ii) in proceedings in
which the director or officer is not successful in the defense thereof,
unless (in the latter case only) it is determined that the director or
officer breached or failed to perform his or her duties to the corporation
and such breach or failure constituted (a) a willful failure by the
director or officer to deal fairly with the corporation or its shareholders
in connection with a matter in which the director or officer had a material
conflict of interest; (b) a violation of the criminal law, unless the
director or officer had reasonable cause to believe his or her conduct was
lawful or had no reasonable cause to believe his or her conduct was
unlawful; (c) a transaction from which the director or officer derived an
improper personal profit; or (d) willful misconduct. The Wisconsin Statutes
specifically state that it is the public policy of Wisconsin to require or
permit indemnification in connection with a proceeding involving securities
regulation, as described therein, to the extent otherwise required or
permitted under the Wisconsin Statutes as described above. The Wisconsin
Statutes also do not limit indemnification of expenses in connection with a
claim by or on behalf of the corporation as is mandated by the DGCL.

The DGCL permits a corporation to adopt a provision in its certificate
of incorporation that limits the monetary liability of the corporation's
directors to the corporation or its stockholders for a breach of the
director's fiduciary duty of care. The Laidlaw Environmental Certificate
contains such a provision. Under the DGCL, a corporation may not limit a
director's monetary liability for (i) any breach of the director's duty of
loyalty to the corporation or its stockholders; (ii) an act or omission not
in good faith or involving intentional misconduct or knowing violation of
law; (iii) the payment of unlawful dividends or unlawful stock repurchases
or redemptions; or (iv) any transaction in which the director received an
improper personal benefit.

Unlike the DGCL, the Wisconsin Statutes automatically limit the
liability of directors of Wisconsin corporations statutorily, without
requiring a provision in a corporation's articles of incorporation. Under
the Wisconsin Statutes, the personal liability of a director to the
corporation and its shareholders is eliminated, except where (a) the
liability is based on a breach of the director's duty (whether duty of care
or duty of loyalty) to the corporation and its shareholders and (b) such
breach constitutes (i) the director's willful failure to deal fairly with
the corporation or its shareholders in connection with a matter in which
the director had a material conflict of interest; (ii) a violation of
criminal law, unless the director had reasonable cause to believe that his
or her conduct was lawful or no reasonable cause to believe his or her
conduct was unlawful; (iii) a transaction from which the director derived
an improper personal profit; or (iv) willful misconduct. The DGCL does not
specifically define the type of conduct that constitutes a breach of a
director's "duty of loyalty," while clauses (i) and (iii) above define the
specific types of behavior under the Wisconsin Statutes that constitute a
breach of a director's duty of loyalty that would preclude elimination of
personal liability. Because of the vagaries of the DGCL in this regard, it
is possible that a broad interpretation of a breach of a director's duty of
loyalty under the DGCL could result in the imposition of personal liability
on a director under the DGCL when such conduct would be shielded from
liability under the Wisconsin Statutes. A director may also be found
personally liable to a corporation for the amount of a distribution made in
violation of the Wisconsin Statutes if the director's vote constitutes
conduct described in the preceding sentence.

Both the Safety-Kleen By-Laws and the Laidlaw Environmental By-Laws
provide for indemnification to the fullest extent permitted by law.

COMPARISON OF DELAWARE AND WISCONSIN LAW -- DIFFERENCES

Although it is impractical to note all of the differences between the
corporation laws of Delaware and Wisconsin, the following is a summary of the
significant differences between the DGCL and the Wisconsin Statutes as
applicable to the Offer and the Merger:

Corporate Franchise Taxes. Under Delaware law, corporations are
assessed a franchise tax based upon the "assumed par value" of their
outstanding shares or total shares issued, whichever is less. Wisconsin has
no comparable tax for domestic corporations.

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<PAGE> 74

Special Meetings of Shareholders. Under Delaware law, a special
meeting of stockholders may be called only by the Board of Directors. Under
Wisconsin law, a special meeting of shareholders must also be called by the
Board of Directors pursuant to a written demand of the holders of not less
than one-tenth of the votes entitled to be cast at such meeting or by such
other person as may be designated in the articles or by-laws.

The Laidlaw Environmental Certificate provides that special meetings
of the stockholders may be called only by the Chairman of the Board of
Directors, the President of Laidlaw Environmental or the Chairman of the
Executive Committee of the Board of Directors of Laidlaw Environmental. The
Safety-Kleen By-Laws provide that special meetings of the shareholders may
be called by the Chairman of the Board of Directors, the Board of
Directors, or the President of Safety-Kleen at the request of holders of at
least 10% of all votes entitled to be cast at a meeting of the
shareholders, if such shareholders meet certain notice requirements in
requesting a meeting.

Inspection of Corporate Records. The DGCL permits any stockholder of
record to inspect the corporate records of a corporation upon a good faith
showing of a proper purpose, and the stockholder list must be made
available for inspection at least 10 days before a stockholders' meeting
and may be inspected by any stockholder. By contrast, under the Wisconsin
Statutes, in order to inspect and copy the corporate records of a
corporation, including the shareholder list, a shareholder must be a
shareholder of record who either has been a shareholder of record of the
corporation for at least 6 months before making a demand or holds at least
5% of the outstanding shares of the corporation. Under the Wisconsin
Statutes, a shareholder's demand must also be made for a proper purpose. In
addition, under the Wisconsin Statutes, all shareholders may inspect the
shareholder list for a meeting beginning two business days after the notice
of a meeting of shareholders is given and ending at the conclusion of the
meeting. Further, under the Wisconsin Statutes, a shareholder who has
delivered a notice and resolution pursuant to Section 180.1150(4) of the
Wisconsin Statutes is entitled to inspect and copy the record of
shareholders.

Dividends. Under the DGCL, a corporation may pay dividends and
repurchase stock out of surplus and any net profits for the fiscal year in
which the dividend was declared or for the preceding fiscal year provided
that no payment may reduce capital below the amount of capital represented
by all classes of shares having a preference upon the distribution of
assets. Under the Wisconsin Statutes, the board of directors may authorize
and the corporation may make distributions to its shareholders unless after
such distribution the corporation would not be able to pay its debts as
they become due or its total assets after the distribution would be less
than the sum of its total liabilities plus, unless the articles of
incorporation provide otherwise, the amount that would be needed, if the
corporation were to be dissolved at the time of the distribution, to
satisfy the preferential rights upon dissolution of shareholders whose
preferential rights are superior to those receiving the distribution.

Dissenters' Rights. Under both Delaware and Wisconsin law, a
shareholder is entitled to receive payment of the fair value of the
shareholder's common stock if the shareholder dissents from a proposed
merger or consolidation. Under the DGCL, dissenters' rights are not
available in the case of a sale of all or substantially all of the assets
of a corporation. Dissenters' rights also are not available for
stockholders of the surviving corporation if the merger did not require the
approval of the stockholders of the surviving corporation or if the shares
of the Delaware corporation that is party to a merger or consolidation are
listed on a national securities exchange or designated as a national market
system security on an interdealer quotation system by the National
Association of Securities Dealers, Inc., or are held of record by not less
than 2,000 persons and in the merger or consolidation stockholders receive
shares of stock of the corporation surviving or resulting from the merger
or consolidation and/or shares of stock of any other corporation which are
either listed on a national securities exchange or designated as a national
market system security on an interdealer quotation system by the National
Association of Securities Dealers, Inc. or held of record by more than
2,000 persons and/or cash in lieu of fractional shares of the foregoing or
any combination of the foregoing.

In addition to being applicable in the case of a merger, under the
Wisconsin Statutes, dissenters' rights are available in the case of a share
exchange or sale of all or substantially all of the assets of a

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<PAGE> 75

Wisconsin corporation. Dissenters' rights may also be made applicable by
affirmative provision in the articles of incorporation, by-laws or a board
of directors' resolution in the case of certain amendments to the articles
of incorporation or other actions requiring a shareholder vote. Under the
Wisconsin Statutes, holders of record and beneficial owners of the Shares
may be entitled to dissenters' rights to object to the Merger and demand
payment of the "fair value" of their Shares in cash, if they properly
exercise such rights in connection with the consummation of the Merger in
accordance with the provisions of the Wisconsin Statutes. Such dissenters'
rights will not be available if the Shares are registered on a national
securities exchange or quoted on the National Association of Securities
Dealers, Inc. automated quotations system on the record date fixed to
determine the shareholders of the Company entitled to notice of a
shareholders' meeting at which shareholders are to vote on the Merger,
unless the Merger would be a "business combination" as defined in Section
180.1130(3) of the Wisconsin Statutes. The Merger would not be a "business
combination" if, among other things, it is consummated as a short-form
merger under the Wisconsin Statutes (where Laidlaw Environmental owns 90%
or more of each class of outstanding shares of a subsidiary corporation, it
may merge the subsidiary corporation into itself upon adoption of a merger
agreement by the board of directors of a parent corporation and upon
complying with certain notice requirements, but without approval of the
shareholders of the parent or the subsidiary) or, at the time, Safety-Kleen
does not have a class of equity securities held of record by 500 or more
persons and at least 100 shareholders of record who have unlimited voting
rights and who are residents of the State of Wisconsin. "Fair Value" of the
Shares would be determined immediately before the consummation of the
Merger, excluding any appreciation or depreciation in anticipation of the
Merger unless such exclusion would be inequitable; provided, however, that
if the Merger is a business combination, "fair value" will be determined
pursuant to Section 180.1130(9)(a) of the Wisconsin Statutes with reference
to the public market price of the Shares if available or, if not available,
by a good faith determination of the Company's Board of Directors. The
"fair value" as so determined, could be equal to, more or less than the
value per Share to be paid pursuant to the Offer and the Merger.

The foregoing summary of the rights of dissenting shareholders does
not purport to be a complete statement of the procedures to be followed by
shareholders desiring to exercise their dissenters' rights in connection
with the Merger. The preservation and exercise of dissenters' rights are
conditioned on strict adherence to the applicable provisions of the
Wisconsin Statutes.

Director and Officer Discretion. Under the provisions of Section
180.0827 of the Wisconsin Statutes (the "Wisconsin Stakeholder
Provisions"), in discharging his or her duties to the corporation and in
determining what he or she believes to be in the best interests of the
corporation, a director or officer may, in addition to considering the
effects of any action on shareholders, consider the effects of the action
on employees, suppliers, customers, the communities in which the
corporation operates and any other factors that the director or officer
considers pertinent. Under Delaware law, the consideration that a board may
give to nonstockholder constituencies is less clear. Under Delaware
judicial doctrine, a director may generally consider the effect of a
proposed action on nonstockholder constituencies when these interests are
not adverse to the interests of stockholders.

Anti-Takeover Statutes. DGCL Section 203 (the "Delaware Business
Combination Statute") applies to certain business combinations involving a
corporation and certain of its stockholders. Unless the corporation's
certificate of incorporation expressly provides that Section 203 of the
DGCL shall not apply, the Delaware Business Combination Statute prevents an
"Interested Stockholder" (defined generally as a person with 15% or more of
the corporation's outstanding voting stock) from engaging in a "Business
Combination" (defined to include a variety of transactions, including a
sale of assets, merger and almost any related party transaction) with a
Delaware corporation for three years following the date such person became
an Interested Stockholder, unless (i) before such person became an
Interested Stockholder, the board of directors of the corporation approved
the transaction in which the Interested Stockholder became an Interested
Stockholder or approved the Business Combination; (ii) upon consummation of
the transaction which resulted in the Interested Stockholder becoming an
Interested Stockholder, the Interested Stockholder owned at least 85% of
the voting stock of the corporation outstanding at the time the transaction
commenced (excluding stock held by directors who are also

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<PAGE> 76

officers of the corporation and by certain employee stock ownership plans);
or (iii) following the transaction in which such person became an
Interested Stockholder, the Business Combination is approved by the board
of directors of the corporation and authorized at a meeting of stockholders
by the affirmative vote of the holders of two-thirds of the outstanding
voting stock of the corporation not owned by the Interested Stockholder.
The Delaware Business Combination Statute currently applies to Laidlaw
Environmental.

Sections 180.1140 to 180.1144 of the Wisconsin Statutes (the
"Wisconsin Business Combination Statute") regulate a broad range of
"business combinations" between a Wisconsin corporation and an "interested
stockholder." The Wisconsin Business Combination Statute defines a
"business combination" to include a merger or share exchange, sale, lease,
exchange, mortgage, pledge, transfer or other disposition of assets equal
to at least 5% of the market value of the stock or assets of the company or
10% of its earning power, or issuance of stock or rights to purchase stock
with a market value equal to at least 5% of the outstanding stock, adoption
of a plan of liquidation and certain other transactions involving an
"interested stockholder." An "interested stockholder" is defined as a
person who beneficially owns, directly or indirectly, 10% of the voting
power of the outstanding voting stock of a corporation or who is an
affiliate or associate of the corporation and beneficially owned 10% of the
voting power of the then outstanding voting stock within the last three
years. The Wisconsin Business Combination Statute prohibits a corporation
from engaging in a business combination (other than a business combination
of a type specifically excluded from the coverage of the statute) with an
interested stockholder for a period of three years following the date such
person becomes an interested stockholder, unless the board of directors
approved the business combination or the acquisition of the stock that
resulted in a person becoming an interested stockholder before such
acquisition. Business combinations after the three-year period following
the stock acquisition date are permitted only if (i) the board of directors
approved the acquisition of the stock prior to the acquisition date; (ii)
the business combination is approved by a majority of the outstanding
voting stock not beneficially owned by the interested stockholder; or (iii)
the consideration to be received by shareholders meets certain requirements
of the statute with respect to form and amount. Unlike the prohibition on
business combinations in the Delaware Business Combination Statute, which
is inapplicable if the interested stockholder acquires at least 85% of the
outstanding voting stock at the time of becoming an interested stockholder
or if during the three-year period of the prohibition the board of
directors and holders of two-thirds of the unaffiliated shares approve the
business combination, the Wisconsin Business Combination Statute's
prohibition on business combinations applies for three years after the
acquisition of at least 10% of the outstanding shares without regard to the
percentage of shares owned by the interested stockholder and cannot be
avoided by subsequent action of the board of directors or shareholders.

Sections 180.1130 to 180.1132 of the Wisconsin Statutes provide that
certain mergers, share exchanges or sales, leases, exchanges or other
dispositions of assets in a transaction involving a "significant
shareholder" and an issuing public corporation are subject to a
supermajority vote of shareholders (the "Wisconsin Fair Price Statute"), in
addition to any approval otherwise required. A "significant shareholder" is
defined as a person who beneficially owns, directly or indirectly, 10% or
more of the voting stock of a corporation or an affiliate of the
corporation which beneficially owned, directly or indirectly, 10% or more
of the voting stock of the corporation within the last two years. Such
business combination must be approved by 80% of the voting power of the
corporation's stock and at least two-thirds of the voting power of the
corporation's stock not beneficially held by the significant shareholder
who is party to the relevant transaction or any of its affiliates or
associates, in each case voting together as a single group, unless the
following fair price standards have been met: (i) the aggregate value of
the per share consideration is equal to the higher of (a) the highest price
paid for any common shares of the corporation by the significant
shareholder in the transaction in which it became a significant shareholder
or within two years before the date of the business combination; (b) the
market value of the corporation's shares on the date of commencement of any
tender offer by the significant shareholder, the date on which the person
became a significant shareholder or the date of the first public
announcement of the proposed business combination, whichever is higher; or
(c) the highest liquidation or dissolution distribution to which holders of
the shares would be entitled; and (ii) either cash, or the form of
consideration used by

67
<PAGE> 77

the significant shareholder to acquire the largest number of shares, is
offered. The effect of this statute on Safety-Kleen is presently unsettled.
Effective October 14, 1997, the Wisconsin Legislature amended this statue
to apply only to a resident domestic corporation that does not have a class
of voting stock that is registered or traded on a national securities
exchange or that is registered under Section 12(g) of the Securities
Exchange Act. However, on November 19, 1997, the Wisconsin Legislature
passed a bill, which awaits the Governor's signature, retroactively
amending the definition of resident domestic corporation to apply only to a
resident domestic corporation that does have a class of voting stock that
is registered or traded on a national securities exchange or that is
registered under Section 12(g) of the Securities Exchange Act.

Under Section 180.1150 (the "Wisconsin Control Share Statute") of the
Wisconsin Statutes, the voting power of shares, including shares issuable
upon conversion of convertible securities or exercise of options or
warrants, of a "resident domestic corporation" held by any person or
persons acting as a group in excess of 20% of the voting power in the
election of directors is limited to 10% of the full voting power of those
shares, unless the articles of incorporation otherwise provide. This
restriction does not apply to shares acquired directly from the resident
domestic corporation, in certain specified transactions, or in a
transaction in which the corporation's shareholders have approved
restoration of the full voting power of the otherwise restricted shares.
The effect of this statute on Safety-Kleen is presently unsettled.
Effective October 14, 1997, the Wisconsin Legislature amended this statute
to apply only to a resident domestic corporation that does not have a class
of voting stock that is registered or traded on a national securities
exchange or that is registered under Section 12(g) of the Securities
Exchange Act. However, on November 19, 1997, the Wisconsin Legislature
passed a bill, which awaits the Governor's signature, retroactively
amending the definition of resident domestic corporation to apply only to a
resident domestic corporation that does have a class of voting stock that
is registered or traded on a national securities exchange or that is
registered under Section 12(g) of the Securities Exchange Act.

Section 180.1134 (the "Wisconsin Defensive Action Restrictions") of
the Wisconsin Statutes provides that in addition to the vote otherwise
required by law or the articles of incorporation of a resident domestic
corporation the approval of the holders of a majority of the shares
entitled to vote is required before such a corporation can take certain
action while a takeover offer is being made or after the takeover offer has
been publicly announced and before it is concluded. Under the Wisconsin
Defensive Action Restrictions, shareholder approval is required for the
corporation to (i) acquire more than 5% of the outstanding voting shares at
a price above the market price from any individual or organization that
owns more than 3% of the outstanding voting shares and has held such shares
for less than two years, unless an equal offer is made to acquire all
voting shares; or (ii) sell or option assets of the corporation which
amount to at least 10% of the market value of the corporation, unless in
the case of this clause (ii) the corporation has at least three independent
directors and a majority of the independent directors vote to opt out of
this provision. The DGCL does not have a similar provision. The effect of
this statute on Safety-Kleen is presently unsettled. Effective October 14,
1997, the Wisconsin Legislature amended this statute to apply only to a
resident domestic corporation that does not have a class of voting stock
that is registered or traded on a national securities exchange or that is
registered under Section 12(g) of the Securities Exchange Act. However, on
November 19, 1997, the Wisconsin Legislature passed a bill, which awaits
the Governor's signature, retroactively amending the definition of resident
domestic corporation to apply only to a resident domestic corporation that
does have a class of voting stock that is registered or traded on a
national securities exchange or that is registered under Section 12(g) of
the Securities Exchange Act.

Statutory Shareholder Liability. Wisconsin law provides that
shareholders of Wisconsin domestic corporations and foreign corporations
registered to do business in Wisconsin are personally liable, up to the
value of the consideration paid to the corporation for their shares, for
certain debts owed to employees for services performed. While the Wisconsin
Statutes specify that such liability is limited to the par value of the
shares, this has been interpreted by at least one Wisconsin trial court to
mean the consideration paid to a corporation for shares. This decision was
affirmed by a split decision of the Wisconsin Supreme

68
<PAGE> 78

Court with one justice abstaining. As a result, the affirmance is without
precedential effect. Delaware has no comparable provision.

"Going Private" Transactions. The securities regulations of the State
of Wisconsin (Wisconsin Administrative Code Section DFI -- Sec. 6.05)
contain provisions that under certain circumstances may require a filing in
connection with the fairness of certain "going private" transactions.
Laidlaw Environmental believes such provisions are not applicable to the
Offer or the Merger.

OTHER COMPARISONS

Preemptive Rights. No shareholder of Safety-Kleen or Laidlaw Environmental
has preemptive rights with regard to shares of common or preferred stock.

Shareholder Rights Plan. As described above in "The Offer -- Conditions of
the Offer -- Rights Agreement," Safety-Kleen has entered into the Rights
Agreement pursuant to which Shares in issue on or after November 9, 1988 entitle
the holder thereof to one Right, subject to certain exceptions.

Laidlaw Environmental is a party to a similar agreement which is triggered
by a tender offer for or acquisition of 15% or more of the issued and
outstanding Laidlaw Environmental Common Stock.

MARKET PRICES

The Laidlaw Environmental Common Stock is listed and principally traded on
the NYSE. The Shares are listed and traded on the NYSE. The following table sets
forth the range of high and low sales prices as reported on the NYSE Composite
Tape.

<TABLE>
<CAPTION>
LAIDLAW
ENVIRONMENTAL SAFETY-KLEEN
------------------ ------------------
PRICE RANGE PRICE RANGE
------------------ ------------------
HIGH LOW HIGH LOW
------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1995
First Quarter..................................... 5 1/2 4 17 7/8 14 1/2
Second Quarter.................................... 5 4 1/8 18 1/8 15
Third Quarter..................................... 5 1/4 4 1/4 18 12 7/8
Fourth Quarter.................................... 4 1/2 2 3/4 15 3/4 13 3/4
1996
First Quarter..................................... 3 1/8 2 15 7/8 13 3/8
Second Quarter.................................... 4 1/2 2 1/4 17 1/2 14 1/2
Third Quarter..................................... 4 1/2 2 5/8 18 5/8 15 1/8
Fourth Quarter.................................... 2 7/8 1 5/8 17 1/4 14 3/4
1997
First Quarter..................................... 3 3/8 1 3/4 18 3/8 14 1/2
Second Quarter.................................... 5 1/4 2 5/8 17 11/16 14 1/8
Third Quarter..................................... 5 15/16 2 7/8 26 16
Fourth Quarter (through November , 1997)........
</TABLE>

On November 3, 1997, the last trading day prior to the public announcement
of Laidlaw Environmental's offer to acquire Safety-Kleen, the closing sales
price per Share was $22.125, and the closing sales price per share of Laidlaw
Environmental Common Stock was $4.9375. On , 1997, the last trading
day prior to the date of the Prospectus, the closing price per Share was
$ , and the closing price per share of Laidlaw Environmental Common
Stock was $ . Past price performance is not necessarily indicative of
likely future price performance. Holders of Shares are urged to obtain current
market quotations for shares of Laidlaw Environmental Common Stock.

69
<PAGE> 79

According to the Safety-Kleen 1996 Form 10-K, there were, as of December
28, 1996, 8,042 holders of record of Shares. As of October 7, 1997, there were
6,234 holders of record of shares of Laidlaw Environmental Common Stock.

According to the Safety-Kleen Form 8-K filed November 10, 1988, the Rights
are listed on the NYSE, but are currently attached to all outstanding Shares and
may not be traded separately. Upon the occurrence of the Safety-Kleen
Distribution Date, the Rights are to trade separately from the Shares.

VALIDITY OF LAIDLAW ENVIRONMENTAL COMMON STOCK

The validity of the shares of Laidlaw Environmental Common Stock offered
hereby will be passed upon for Laidlaw Environmental by Katten Muchin & Zavis,
525 West Monroe Street, Chicago, Illinois 60661.

EXPERTS

The consolidated balance sheets as of August 31, 1997 and 1996 and the
consolidated statements of income, stockholders' equity and cash flows for each
of the three years in the period ended August 31, 1997, of Laidlaw Environmental
incorporated by reference in this Prospectus and elsewhere in the Registration
Statement have been incorporated herein in reliance on the report of Coopers &
Lybrand L.L.P. independent accountants, given on the authority of that firm as
experts in accounting and auditing.

70
<PAGE> 80

SCHEDULE A

DIRECTORS AND EXECUTIVE OFFICERS OF LAIDLAW ENVIRONMENTAL

Directors and Executive Officers of Laidlaw Environmental. The name,
business address, present principal occupation or employment and five-year
employment history of each of the directors and executive officers of Laidlaw
Environmental are set forth below. Unless otherwise indicated, each occupation
set forth opposite an individual's name refers to employment with Laidlaw
Environmental. Unless otherwise indicated, each director and executive officer
listed below is a citizen of the United States.

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR EMPLOYMENT DURING THE
NAME AND BUSINESS ADDRESS AGE LAST FIVE YEARS, DIRECTORSHIPS OF PUBLIC COMPANIES
- ------------------------- --- --------------------------------------------------
<S> <C> <C>
Kenneth W. Winger.................... 59 President, Chief Executive Officer and Director of
President, Chief Executive Officer Laidlaw Environmental since May 15, 1997; President,
and Director of Laidlaw Chief Operating Officer and sole director of Laidlaw
Environmental since May 1997 Environmental Services (US), Inc. from July 1995 until
Laidlaw Environmental Services, May 1997; Executive Vice President for Business
Inc. Development of Laidlaw Waste Systems, Ltd. from January
1301 Gervais Street, Suite 300 1995 until July 1995; from May 1991 until December 1994,
Columbia, S.C. 29201 Senior Vice President for Corporate Development of
Laidlaw Inc. Mr. Winger also is a director of ViroGroup,
Inc. Non- U.S. citizen.
James R. Bullock..................... 53 President and Chief Executive Officer of Laidlaw Inc.
Director of Laidlaw Environmental since October 1993; for more than a year prior thereto,
and Chairman of the Board since May President and Chief Executive Officer of Cadillac
1997 Fairview Corporation Limited. Mr. Bullock also is a
Laidlaw Inc. director of Laidlaw Inc. Non-U.S. citizen.
3221 North Service Road
Burlington, Ontario L7R 3Y8
John R. Grainger..................... 48 Executive Vice President and Chief Operating Officer of
Director of Laidlaw Environmental Laidlaw Inc. since September 1997; President and Chief
since May 1997 Operating Officer of Laidlaw Transit, Inc. since May
Laidlaw Inc. 1992. Mr. Grainger currently serves as Chairman of the
3221 North Service Road Human Resources and Compensation Committee. Non-U.S.
Burlington, Ontario L7R 3Y8 citizen.
Leslie W. Haworth.................... 54 Senior Vice President and Chief Financial Officer of
Director of Laidlaw Environmental Laidlaw Inc. for more than five years. Mr. Haworth
since May 1997 currently serves as Chairman of the Audit Committee.
Laidlaw Inc. Non-U.S. citizen.
3221 North Service Road
Burlington, Ontario L7R 3Y8
John W. Rollins, Sr.................. 80 Chairman of the Board and Chief Executive Officer of
Director of Rollins since 1982 Rollins Truck Leasing Corp. for more than five years.
Rollins Truck Leasing Corp. Mr. Rollins was Chairman of the Board and Chief
2200 Concord Pike Executive Officer of Rollins from 1988 until May 15,
One Rollins Plaza 1997. Mr. Rollins also is a director of Matlack Systems,
Wilmington, DE 19803 Inc., Rollins, Inc., RPC, Inc. and Dover Downs En-
tertainment, Inc. Mr. Rollins is the father of John W.
Rollins, Jr.
</TABLE>

A-1
<PAGE> 81

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR EMPLOYMENT DURING THE
NAME AND BUSINESS ADDRESS AGE LAST FIVE YEARS, DIRECTORSHIPS OF PUBLIC COMPANIES
- ------------------------- --- --------------------------------------------------
<S> <C> <C>
John W. Rollins, Jr.................. 55 President and Chief Operating Officer and a director of
Director of Rollins since 1982 Rollins Truck Leasing Corp. for more than five years;
Rollins Truck Leasing Corp. Chairman of the Board of Matlack Systems, Inc. for more
2200 Concord Pike than five years. Mr. Rollins was Senior Vice Chairman of
One Rollins Plaza the Board of Rollins from 1988 until May 15, 1997. Mr.
Wilmington, DE 19803 Rollins also is a director of Dover Downs Entertainment,
Inc. Mr. Rollins is a member of the Human Resources and
Compensation Committee. Mr. Rollins is the son of John
W. Rollins, Sr.
David E. Thomas, Jr.................. 40 Senior Managing Director and the Head of the Investment
Director of Laidlaw Environmental Banking Group of Raymond James since July 1996; from
since June 1997 1991 until July 1996, Managing Director of Raymond
Raymond James & Associates, Inc. James. Mr. Thomas also is a director of Reynolds, Smith
880 Carillon Parkway and Hills, Inc. Mr. Thomas is a member of the Human
St. Petersburg, FL 33716 Resources and Compensation Committee.
Henry B. Tippie...................... 70 For more than five years, Chairman of the Board and
Director of Rollins since 1982 President of Tippie Services; for more than five years,
Tippie Service, Inc. Chairman of the Executive Committee and Vice Chairman of
3420 Executive Center Drive, NW the Board of Rollins Truck Leasing Corp. Mr. Tippie was
Suite 163 Chairman of the Executive Committee of Rollins from 1988
Austin, TX 78731 until May 15, 1997. Mr. Tippie also is a director of
Matlack Systems, Inc., Dover Downs Entertainment, Inc.,
RPC, Inc. and Rollins Inc. Mr. Tippie is a member of the
Audit Committee.
James L. Wareham..................... 58 President of AK Steel Corporation since March 1997; from
Director of Laidlaw Environmental 1992 until 1996, Chief Executive Officer of
since June 1997 Wheeling-Pittsburgh Steel Corporation. Mr. Wareham is a
AK Steel Corporation member of the Audit Committee.
703 Curtis Street
Middleton, OH 45043
Grover C. Wrenn...................... 54 Chairman and Chief Executive Officer of Better Health
Director of Laidlaw Environmental Network, Inc. since June 1996; Chief Executive Officer
since July 1997 of EnSys Environmental Products, Inc. from April 1995
4 Wolfe Street through December 1996; and President and Chief Executive
Alexandria, VA 22314 Officer of Applied Bioscience International from 1991
through March 1995. Mr. Wrenn also is a director of
Strategic Diagnostics, Inc. and Pharmakinetics Labora-
tories, Inc.
Michael J. Bragagnolo................ 51 Executive Vice President and Chief Operating Officer of
Executive Vice President and Chief Laidlaw Environmental Services, Inc. since May 15, 1997;
Operating Officer of Laidlaw Executive Vice President and Chief Operating Officer of
Environmental since May 1997 Laidlaw Environmental Services (US), Inc. from January
Laidlaw Environmental Services, 1997 until May 1997; Executive Vice President of United
Inc. States Operations of Laidlaw Waste Systems, Inc. from
1301 Gervais Street, Suite 300 September 1993 until January 1997; Vice President of
Columbia, SC 29201 Strategic Analysis and Planning of Laidlaw Waste
Systems, Inc. from December 1991 until September 1993.
Non- U.S. citizen.
</TABLE>

A-2
<PAGE> 82

A-3
<PAGE> 83

SCHEDULE B

OWNERSHIP OF SHARES BY CERTAIN BENEFICIAL OWNERS
AND SAFETY-KLEEN MANAGEMENT

The following table and notes thereto, which, other than information
regarding Laidlaw Environmental, are reproduced from the Safety-Kleen Proxy
Statement, set forth certain information with respect to beneficial ownership of
Shares as of March 28, 1997 by (a) all directors of Safety-Kleen, (b) the named
directors and officers of Safety-Kleen, including the executive officers of
subsidiaries of Safety-Kleen and (c) all directors and executive officers of
Safety-Kleen as a group. The following table also sets forth certain information
with respect to beneficial ownership of Shares by Laidlaw Environmental as of
the date of this Prospectus. An asterisk indicates ownership of less than one
percent of outstanding Shares.

<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF SHARES OUTSTANDING
NAME BENEFICIALLY OWNED(1) COMMON STOCK(2)
- ---- --------------------- -----------------
<S> <C> <C>
Donald W. Brinckman.................................... 869,156(3) 1.48%
Joseph Chalhoub........................................ 350,683(4) *
David A. Dattilo....................................... 119,972(5) *
Richard T. Farmer...................................... 42,750(6) *
Russell A. Gwillim..................................... 197,981(7) *
F. Henry Habicht II.................................... 42,226(8) *
Edgar D. Jannotta...................................... 67,500(6) *
John G. Johnson, Jr.................................... 91,513(9) *
Karl G. Otzen.......................................... 1,480,581(12) 2.54%
Paul D. Schrage........................................ 31,180(6)
Marcia E. Williams..................................... 8,500(10) *
W. Gordon Wood......................................... 70,805(6) *
</TABLE>

- ---------------

* Denotes less than one percent of shares outstanding.
(1) Under regulations of the Securities and Exchange Commission, persons who
own or have the power to vote or dispose of shares, either alone or jointly
with others, are deemed to be the beneficial owners of such shares. Such
persons are also deemed to be the beneficial owners of shares beneficially
owned by certain close family members.
(2) Shares subject to options exercisable within 60 days of February 26, 1997
are considered outstanding for the purpose of determining the percent of
the class held by the holder of such option, but not for the purpose of
computing the percentage held by others.
(3) Includes 73 shares owned by his wife, 431,091 shares subject to options
exercisable within 60 days of February 26, 1997 and 1,033 shares held in
the Company's 401(k) plan as to which he does not have voting control.
(4) Includes 275,000 shares owned by Breslube Industries, Ltd. of which 100% is
owned by Mr. Chalhoub. Also included are 59 shares owned by his wife, 75
shares owned by his son and 75,549 shares subject to options exercisable
within 60 days of February 26, 1997.
(5) Includes 88,627 shares subject to options exercisable within 60 days of
February 26, 1997.
(6) Includes 30,000 shares subject to options exercisable within 60 days of
February 26, 1997.
(7) Includes 30,223 shares owned by his wife and 30,000 shares subject to
options exercisable within 60 days of February 26, 1997. Mr Gwillim is also
a co-trustee for 45,827 shares held in an irrevocable trust for which he
has no beneficial ownership; such shares are not included in the table.
(8) Includes 39,712 shares subject to options exercisable within 60 days of
February 26, 1997 and 114 shares held in the Company's 401(i) plan as to
which he does not have voting control.
(9) Includes 700 shares owned by his wife, 81,962 shares subject to options
exercisable within 60 days of February 26, 1997 and 322 shares held in the
Company's 401(k) plan as to which he does not have voting control.
(10) Includes 7,500 shares subject to options exercisable within 60 days of
February 26, 1997.
(11) Includes 1,537,470 shares subject to options exercisable within 60 days of
February 26, 1997 and 1,798 shares held in the Company's 401(k) plan as to
which they do not have voting control.

(12) Karl G. Otzen and Lucy T. Otzen (the "Otzens") are husband and wife. For
purposes of this table, Karl G. Otzen is deemed to own shares owned by Lucy
T. Otzen, and accordingly such number of shares is shown. In December 1992,
the Otzens caused 683,760 of their shares to be contributed to Circle L

B-1
<PAGE> 84

Limited Partnership. The general partner which controls the Partnership is
a corporation in which Karl G. Otzen, Lucy T. Otzen, Joan Emery Lammers and
her husband (the "Lammers"). Each owns 25% of the voting stock and each
occupies one of the four positions on the Board of Directors. Because the
Otzens and Lammers share voting power over all of the shares held by the
Partnership, each of them may be deemed to "own" all shares in the
partnership under the criteria governing this table. To enhance clarity of
presentation, however, the shares contributed to the Partnership by Joan
Emery Lammers are shown opposite Karl G. Otzen's name and also included are
757,721 shares owned by trustees of which the Otzens are co-trustees, 9,100
shares owned by a trust of which The Northern Trust Company is trustee and
30,000 shares subject to options exercisable by Karl G. Otzen within 60
days of February 26, 1997.

B-2
<PAGE> 85

Manually signed facsimile copies of the Letter of Transmittal will be
accepted. The Letter of Transmittal, certificates for Shares and any other
required documents should be sent or delivered by each Safety-Kleen Shareholder
or his or her broker, dealer, commercial bank, trust company or other nominee to
the Exchange Agent at one of its addresses set forth below.

IBJ SCHRODER BANK & TRUST COMPANY

<TABLE>
<S> <C> <C>
BY HAND BY OVERNIGHT COURIER BY MAIL

1 State Street 1 State Street P.O. Box 84
New York, New York 10004 New York, New York 10004 Bowling Green Station
Attn: Reorg. Dept. Attn: Reorg. Dept. New York, New York 10004
Securities Processing Securities Processing Attn: Reorg. Dept.
Window SC-1 Window SC-1 Securities Processing
Window SC-1
By Facsimile Transmission Telephone Number
(for Eligible Institutions only) For information call collect:
(212) 858-2611 (212) 858-2100
Confirm by telephone: (212) 858-2013
</TABLE>

Any questions or requests for assistance or additional copies of the Prospectus,
the Letter of Transmittal and the Notice of Guaranteed Delivery may be directed
to the Information Agent or the Dealer Manager at their respective telephone
numbers and locations listed below. You may also contact your local broker,
commercial bank, trust company or nominee for assistance concerning the Offer.

The Information Agent for the Offer is:

MORROW & CO., INC.
909 Third Avenue
20th Floor
New York, NY 10022
212/754-8000
Toll Free 800/566-9061

Banks and Brokerage
Firms please call:
800/662-5200

The Dealer Manager for the Offer is:

BEAR, STEARNS & CO. INC.
245 Park Avenue
New York, NY 10167
212/272-2000
Toll Free 800/999-2000
<PAGE> 86

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Laidlaw Environmental is incorporated under the laws of the State of
Delaware. Section 145 of the DGCL, inter alia ("Section 145") provides that a
Delaware corporation may indemnify any person who were, are or are threatened to
be made, parties to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of such corporation), by reason of the fact that
such person is or was an officer, director, employee or agent of such
corporation, or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation or enterprise. The
indemnity may include expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding, provided such person acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
corporation's best interests and, with respect to any criminal action or
proceeding, had no reasonable cause to believe that his conduct was illegal. A
Delaware corporation may indemnify any persons who are, were or are threatened
to be made, a party to any threatened, pending or completed action or suit by or
in the right of the corporation by reason of the fact that such person was a
director, officer, employee or agent of such corporation, or is or was serving
at the request of such corporation as a director, officer, employee or agent of
another corporation or enterprise. The indemnity may include expenses (including
attorneys' fees) actually and reasonably incurred by such person in connection
with the defense or settlement of such action or suit, provided such person
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the corporation's best interests, provided that no indemnification is
permitted without judicial approval if the officer, director, employee or agent
is adjudged to be liable to the corporation. Where an officer, director,
employee or agent is successful on the merits or otherwise in the defense of any
action referred to above, the corporation must indemnify him against the
expenses which such officer or director has actually and reasonably incurred.

The Laidlaw Environmental Certificate of Incorporation provides that, to
the fullest extent permitted by the DGCL as the same exists or may hereafter be
amended, a director of Laidlaw Environmental shall not be liable to Laidlaw
Environmental or its stockholders for monetary damages for a breach of fiduciary
duty as a director.

Section 145 further authorizes a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation or enterprise,
against any liability asserted against him and incurred by him in any such
capacity, arising out of his status as such, whether or not the corporation
would otherwise have the power to indemnify him under Section 145.

All of the Laidlaw Environmental directors and officers are covered by
insurance policies maintained and held in effect by Laidlaw Inc. against certain
liabilities for actions taken in such capacities, including liabilities under
the Securities Act of 1933.

II-1
<PAGE> 87

ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
(3)(a) -- Restated Certificate of Incorporation of the Company dated
May 13, 1997, and Amendment to Certificate of Incorporation
dated May 15, 1997, filed as Exhibit 3(a) to the
Registrant's Form 10-Q for the Quarter ended May 31, 1997,
and incorporated herein by reference.
(3)(a)(1) -- Certificate of Correction Filed to Correct a Certain Error
in the Restated and Amended Certificate of Incorporation of
the Company dated October 15, 1997, filed as Exhibit 3(a)(i)
to the Registrant's Form 10-K for the Fiscal Year ended
August 31, 1997, and incorporated herein by reference.
(3)(b) -- Bylaws of the Company filed as Exhibit 4(ii) to the
Registrant's Current Report on Form 8-K dated July 29, 1997,
and incorporated herein by reference.
(4)(a) -- Rights Agreement dated as of June 14, 1989 between the
Company and First Chicago Trust Company as successor to
Registrar and Transfer Company, as Rights Agent filed as an
Exhibit to the Registrant's Form 8-K filed on June 13, 1995
and incorporated herein by reference.
(4)(b) -- Amendment No. 1 dated as of March 31, 1995 to the Rights
Agreement between the Company and First Chicago Trust
Company as successor to Registrar and Transfer Company, as
Rights Agent filed as an Exhibit to the Registrant's Form
8-K filed on June 13, 1995 and incorporated herein by
reference.
(4)(c) -- Credit Agreement among Laidlaw Chem-Waste, Inc., Laidlaw
Environmental Services (Canada) Ltd., Toronto Dominion
(Texas) Inc., The Toronto-Dominion Bank, TD Securities (USA)
Inc., the Bank or Nova Scotia, NationsBank, N.A. and The
First National Bank of Chicago and NationsBank, N.A. as
Syndication Agent dated as of May 9, 1997, filed as Exhibit
4(c) to the Registrant's Form 10- Q for the Quarter ended
March 31, 1997, and incorporated herein by reference.
(4)(d) -- $350,000,000 5% Subordinated Convertible Pay-In-Kind
Debenture due 2009 issued by Registrant on May 15, 1997 to
Laidlaw Inc. the form of which was included as an appendix
to the Registrant's Definitive Proxy Statement on Form DEF
14A, filed on May 1, 1997 and incorporated herein by
reference.
(4)(e) -- Registration Rights Agreement dated May 15, 1997 between
Registrant, Laidlaw Transportation, Inc. and Laidlaw Inc.
included as appendix to the Registrant's Definitive Proxy
Statement on Form DEF 14A, the form of which was filed on
May 1, 1997 and incorporated herein by reference.
(4)(f) -- Indenture dated as of May 1, 1993 between the Industrial
Development Board of the Metropolitan Government of
Nashville and Davidson County (Tennessee) and NationsBank of
Tennessee, N.A., filed as Exhibit 4(f) to the Registrant's
Form 10-Q for the Quarter ended May 31, 1997, and
incorporated herein by reference.
(4)(g) -- Indenture of Trust dated as of February 1, 1995 between
Carbon County, Utah and West One Bank, Utah, now known as
U.S. Bank, as Trustee, filed as Exhibit 4(g) to the
Registrant's Form 10-Q for the Quarter ended May 31, 1997,
and incorporated herein by reference.
(4)(h) -- Indenture of Trust dated as of August, 1995 between Tooele
County, Utah and West One Bank, Utah, now known as U.S.
Bank, as Trustee, filed as Exhibit 4(h) to the Registrant's
Form 10-Q for the Quarter ended May 31, 1997, and
incorporated herein by reference.
(4)(i) -- Indenture of Trust dated as of July 1, 1997 between Carbon
County, Utah and U.S. Bank, a national banking association,
as Trustee, filed as Exhibit 4(i) to the Registrant's Form
10-Q for the Quarter ended May 31, 1997, and incorporated
herein by reference.
(4)(j) -- Indenture of Trust dated as of July 1, 1997 between Tooele
County, Utah and U.S. Bank, a national banking association,
as Trustee, filed as Exhibit 4(j) to the Registrant's Form
10-Q for the Quarter ended May 31, 1997, and incorporated
herein by reference.
</TABLE>

II-2
<PAGE> 88

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
(4)(k) -- Indenture of Trust dated as of July 1, 1997 between
California Pollution Control Financing Authority and U.S.
Bank, a national banking association, as Trustee, filed as
Exhibit 4(k) to the Registrant's Form 10-Q for the Quarter
ended May 31,1997, and incorporated herein by reference.
(4)(l) -- Stock Purchase Agreement between Westinghouse Electric
Corporation (Seller) and Rollins Environmental Services,
Inc. (Buyer) for National Electric, Inc. dated March 7,
1995, filed as an Exhibit to the Registrant's Form 8-K filed
on June 13, 1995, and incorporated herein by reference.
(4)(m) -- Second Amendment to Stock Purchase Agreement (as referenced
in Exhibit (4)(1) above, dated May 15, 1997, among
Westinghouse Electric Corporation, Rollins Environmental
Services, Inc. and Laidlaw Inc., filed as Exhibit 4(m) to
the Registrant's Form 10-Q for the Quarter ended May 31,
1997, and incorporated herein by reference.
(4)(n) -- Promissory Note dated May 15, 1997 for $60,000,000 from
Laidlaw Environmental Services, Inc. to Westinghouse
Electric Corporation, filed as Exhibit 4(n) to the
Registrant's Form 10-Q for the Quarter ended May 31, 1997,
and incorporated herein by reference.
(4)(o) -- Guaranty Agreement dated May 15, 1997 by Laidlaw Inc. to
Westinghouse Electric Corporation guaranteeing Promissory
Note dated May 15, 1997 (as referenced in Exhibit (4)(n))
from Laidlaw Environmental Services, Inc. to Westinghouse
Electric Corporation, filed as Exhibit 4(o) to the
Registrant's Form 10-Q for the Quarter ended May 31, 1997,
and incorporated herein by reference.
(4)(p) -- Commitment letter of October 31, 1997 between the
Toronto-Dominion Bank, TD Securities Inc. and Laidlaw
Environmental Services, Inc.**
(5) -- Opinion of Katten Muchin & Zavis as to the legality of the
shares of common stock being offered.*
(10)(a) -- Rollins Environmental Services, Inc. 1982 Incentive Stock
Option Plan, filed with Amendment No. 1 to the Company's
Registration Statement No. 2-84139 on Form S-1 dated June
24, 1983 and incorporated herein by reference.
(10)(b) -- Rollins Environmental Services, Inc. 1993 Stock Option Plan,
filed with the Company's Proxy Statement for the Annual
Meeting of Stockholders held January 28, 1994 and
incorporated herein by reference.
(10)(c) -- Stock Purchase Agreement dated February 6, 1997, among the
Registrant, Laidlaw Inc., and Laidlaw Transportation, Inc.
included as an appendix to the Registrant's Definitive Proxy
Statement on Form DEF 14A, filed on May 1, 1997, and
incorporated herein by reference.
(10)(e) -- Management Incentive Plan for fiscal year 1996, filed as
Exhibit 10(e) to the Registrant's Form 10-Q for the Quarter
ended May 31, 1997, and incorporated herein by reference.
(11) -- Statement regarding computation of earnings per share, filed
as Exhibit (11) to the Registrant's Form 10-K for the year
ended August 31, 1997, and incorporated herein by reference.
(12) -- Computation of ratio of earnings to fixed charges, filed as
Exhibit (12) to the Registrant's Form 10-K for the year
ended August 31, 1997, and incorporated herein by reference.
(21) -- Subsidiaries of the Registrant.
(23)(a) -- Consent of Coopers & Lybrand, independent accountants.
(23)(b) -- Consent of Katten Muchin & Zavis (included in Exhibit (5)).
(24) -- Power of Attorney (included on the signature page of this
Registration Statement).**
(99)(a) -- Letter of Transmittal.*
(99)(b) -- Notice of Guaranteed Delivery.*
(99)(c) -- Safety-Kleen Corporation v. Laidlaw Environmental Services,
Inc., Case No. 97C8003, filed November 17, 1997.
</TABLE>

II-3
<PAGE> 89

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
(99)(d) -- Verified Answer, Affirmative Defenses, and Counterclaim of
Laidlaw Environmental Services, Inc. and LES Acquisition,
Inc., Case No. 97C8003, filed November 24, 1997.
</TABLE>

- ---------------

* To be filed by amendment.

** Previously filed with this Registration Statement.

ITEM 22. UNDERTAKINGS

The undersigned Registrant hereby undertakes:

(1) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

(2) To deliver or cause to be delivered with the prospectus, to each
person to whom the prospectus is sent or given, the latest annual report to
security holders that is incorporated by reference in the prospectus and
furnished pursuant to and meeting the requirements of Rule 14a-3 or Rule
14c-3 under the Securities Exchange Act of 1934; and, where interim
financial information is required to be presented by Article 3 of
Regulations S-X is not set forth in the prospectus, to deliver, or cause to
be delivered to each person to whom the prospectus is sent or given, the
latest quarterly report that is specifically incorporated by referenced to
provide such interim financial information.

(3) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred by a director, officer
or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

(4) The undersigned Registrant hereby undertakes to respond to
requests for information that is incorporated by reference into the
prospectus pursuant to Items 4, 10(b), 11 or 13 of this Form within one
business day of receipt of such request, and to send the incorporated
documents by first class mail or other equally prompt means. This includes
information contained in documents filed subsequent to the effective date
of the registration statement through the date of responding to the
request.

(5) The undersigned Registrant hereby undertakes to supply by means of
a post-effective amendment all information concerning a transaction, and
the company being acquired involved therein, that was not the subject of
and included in the registration statement when it became effective.

II-4
<PAGE> 90

SIGNATURES PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-4 and has duly caused this Amendment to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Columbia, and State of South Carolina on the
25th day of November, 1997.

Laidlaw Environmental Services, Inc.

By: /s/ KENNETH W. WINGER
------------------------------------
Kenneth W. Winger
President and Chief Executive
Officer

Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below by the following persons in
the capacities indicated on November 25th, 1997.

<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>

* Chairman of the Board and Director
- -----------------------------------------------------
James R. Bullock

/s/ KENNETH W. WINGER President, Chief Executive Officer and
- ----------------------------------------------------- Director
Kenneth W. Winger

* Senior Vice President, Finance and Chief
- ----------------------------------------------------- Financial Officer
Paul R. Humphreys

* Director
- -----------------------------------------------------
John R. Grainger

* Director
- -----------------------------------------------------
Leslie W. Haworth

* Director
- -----------------------------------------------------
John W. Rollins, Sr.

* Director
- -----------------------------------------------------
John W. Rollins, Jr.

* Director
- -----------------------------------------------------
David E. Thomas, Jr.

/s/ HENRY B. TIPPIE Director
- -----------------------------------------------------
Henry B. Tippie

* Director
- -----------------------------------------------------
James L. Wareham

* Director
- -----------------------------------------------------
Grover C. Wrenn
</TABLE>

II-5
<PAGE> 91

<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
President and Chief Executive Officer
* /s/ KENNETH W. WINGER
- -----------------------------------------------------
Kenneth W. Winger
As Attorney-in-Fact
</TABLE>

II-6
<PAGE> 92

INDEX TO EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
(21) -- Subsidiaries of the Registrant.
(23)(a) -- Consent of Coopers & Lybrand, independent accountants.
(99)(c) -- Safety-Kleen Corporation v. Laidlaw Environmental Services,
Inc., Case No. 97C 8003, filed November 17, 1997.
(99)(d) -- Verified Answer, Affirmative Defenses, and Counterclaim of
Laidlaw Environmental Services, Inc. and LES Acquisition,
Inc., Case No. 97C 8003, filed November 24, 1997.
</TABLE>

<PAGE> 1

EXHIBIT (21)

LAIDLAW ENVIRONMENTAL SERVICES, INC.

The following list sets forth the subsidiaries of Laidlaw Environmental
Services, Inc. as of November 21, 1997. Parent subsidiary relations are
indicated by indentations. Unless otherwise indicated, 100% of the voting
securities of each subsidiary is owned by the indicated parent of such
subsidiary.

<TABLE>
<CAPTION>
STATE OF
INCORPORATION
----------------
<S> <C>
LES, Inc.................................................... Delaware
Laidlaw Environmental Services (US), Inc.................. Delaware
Laidlaw Environmental Services (Lone and Grassy
Mountain), Inc........................................ Oklahoma
Laidlaw Environmental Services (Tulsa), Inc.......... Oklahoma
Laidlaw Environmental Services (San Antonio),
Inc.............................................. Texas
Laidlaw Environmental Services (Wichita), Inc..... Kansas
USPCI of Mississippi, Inc. (50%)..................... Mississippi
Laidlaw Environmental Services of Delaware, Inc...... Delaware
ECDC East, L.C. (80%)............................. Utah
ECDC Environmental Services, L.C. (80%)........... Utah
ECDC Environmental, L.C. (80%).................... Utah
Laidlaw Environmental Services (Rosemount), Inc........ Minnesota
Laidlaw Environmental Services (Sawyer), Inc........... Oklahoma
Laidlaw Environmental Services (Tucker), Inc........... Georgia
Ninth Street Properties, Inc......................... Missouri
Laidlaw Environmental Services (San Jose), Inc......... California
Chemclear, Inc. of Los Angeles......................... Delaware
USPCI, Inc. of Georgia................................. Delaware
LES Holding's, Inc..................................... Delaware
East Carbon Development Financial Partners, Inc........ Utah
Laidlaw Environmental Services (Imperial Valley), Inc.
(50%)................................................. California
Laidlaw Environmental Services (Lokern), Inc. (23%).... California
Laidlaw Environmental Services (North East), Inc....... New Hampshire
Laidlaw Environmental Services (Recovery), Inc......... Louisiana
Laidlaw Environmental Services (TES), Inc.............. Texas
Corsan Trucking, Inc. (25%).......................... Louisiana
Laidlaw Environmental Services (TG), Inc............... Delaware
Laidlaw Environmental Services (TOC), Inc.............. South Carolina
Laidlaw Environmental Services (TS), Inc............... Delaware
Laidlaw Environmental Services (Thermal Treatment),
Inc................................................... Delaware
Corsan Trucking, Inc. (75%)............................ Louisiana
GSX Chemical Services of Ohio, Inc..................... Ohio
LEMC, Inc.............................................. Delaware
Laidlaw Chemical Services, Inc......................... Massachusetts
Laidlaw Environmental Services (Altair), Inc........... Texas
Laidlaw Environmental Services (FS), Inc. (13%)...... Delaware
</TABLE>

<PAGE> 2
<TABLE>
<CAPTION>
STATE OF
INCORPORATION
----------------
<S> <C>
Laidlaw Environmental Services (BDT), Inc.............. New York
Laidlaw Environmental Services (FS), Inc. (86%)........ Delaware
Laidlaw Environmental Services (GS), Inc............... Tennessee
Laidlaw Environmental Services (Clive), Inc............ Oklahoma
Laidlaw Environmental Services (WT), Inc............... Ohio
Laidlaw OSCO Holdings, Inc............................. Delaware
Laidlaw Environmental Services of Nashville, Inc..... Tennessee
OSCO Treatment Systems of Mississippi, Inc. (50%).... Tennessee
Bryson Industrial Services, Inc...................... South Carolina
Laidlaw Environmental Services of Bartow, Inc.......... Florida
Laidlaw Environmental Services of California, Inc...... California
Laidlaw Environmental Services (Lokern), Inc.
(77%)............................................... California
Laidlaw Environmental Services (Imperial Valley),
Inc. (50%).......................................... California
Laidlaw Environmental Services of Chattanooga, Inc..... Tennessee
Laidlaw Environmental Services of Illinois, Inc........ Illinois
Laidlaw Environmental Services of South Carolina,
Inc................................................... South Carolina
Laidlaw Environmental Services of White Castle, Inc.... Colorado
Laidlaw Environmental Services de Mexico, S.A. de C.V.
(90%).................................................. Mexico
Laidlaw Environmental Services (Puerto Rico), Inc......... Puerto Rico
Laidlaw Environmental Services (Bridgeport), Inc.......... Delaware
Laidlaw Environmental Services (Deer Park), Inc........... Delaware
Laidlaw Environmental Services (Baton Rouge), Inc......... Delaware
Laidlaw Environmental Services (Plaquemine), Inc.......... Delaware
Laidlaw Environmental Services (Custom Transport), Inc.... Delaware
Laidlaw Environmental Services (Los Angeles), Inc......... California
Laidlaw Environmental Services (Tipton), Inc.............. Delaware
Laidlaw Environmental Services (Gloucester County),
Inc.................................................... Delaware
Laidlaw Environmental Services (Deer Trail), Inc.......... Colorado
Laidlaw Environmental Services (Mt Pleasant), Inc......... Tennessee
Laidlaw Environmental Services (Minneapolis), Inc......... Minnesota
Laidlaw Environmental Services (Aragonite), Inc........ Delaware
Laidlaw Environmental Services (Sussex), Inc.............. Delaware
Laidlaw Environmental, Inc................................ Delaware
LES Acquisition, Inc...................................... Delaware
Laidlaw Environmental Services (Canada) Ltd............... Canada
Laidlaw Environmental Services Ltd..................... Ontario
Laidlaw Environmental Services (B.C.) Inc............ Canada
I.W.M. Disposal Inc............................... British Columbia
Laidlaw Environmental Services (Sarnia) Ltd.......... Ontario
1197296 Ontario Inc............................... Ontario
Laidlaw Environmental Services (Quebec) Ltd.......... Quebec
Laidlaw Environmental Services (Mercier) Ltd...... Quebec
Les Entreprises D'Incineration Industrielle Tricil
Inc.............................................. Quebec
Laidlaw Environmental Services (Ryley) Ltd........... Alberta
Laidlaw Environmental Services (Atlantic) Limited.... Nova Scotia
Laidlaw Environmental Services (Guelph), Inc......... Ontario
</TABLE>

<PAGE> 1

EXHIBIT (23)(A)

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the incorporation by reference in this registration statement
on Form S-4 (File No. 33-40185) of our report dated October 7, 1997, on our
audits of the consolidated financial statements and financial statement schedule
of Laidlaw Environmental Services, Inc., which report is incorporated by
reference in the Annual Report on Form 10-K. We also consent to the reference to
our firm under the caption "Experts."

/s/ COOPERS & LYBRAND

--------------------------------------

Charlotte, North Carolina

November 24, 1997

<PAGE> 1

EXHIBIT (99)(C)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

SAFETY-KLEEN CORPORATION,

Plaintiff,

v.
No. 97C 8003
LAIDLAW ENVIRONMENTAL SERVICES,
INC.,
Defendant.

COMPLAINT

Plaintiff Safety-Kleen Corporation ("Safety-Kleen") for its complaint
against Laidlaw Environmental Services, Inc. ("Laidlaw"), states:

SUMMARY

On November 13, 1997, Laidlaw demanded the right to inspect and copy
Safety-Kleen's record of shareholders to solicit proxies and communicate with
shareholders regarding Laidlaw's exchange offer for Safety-Kleen stock, made
that same day. The securities that comprise a substantial portion of the
consideration in the exchange offer have not yet been registered with the
Securities and Exchange Commission. Accordingly, Laidlaw is barred by Section
5(b)(1) of the Securities Act of 1933, 15 U.S.C. sec. 77e(b)(1), from
communicating with Safety-Kleen's shareholders about those securities through
written means other than through a prospectus complying with Sections 5(b)(1)
and 10 of the Securities Act of 1933, 15 U.S.C. sec.sec. 77e(b)(1) and 77j. To
require Safety-Kleen to provide its shareholder list under these circumstances
would be to require Safety-Kleen to facilitate a violation of the federal
securities laws. Safety-Kleen therefore seeks a declaration from this Court that
it need not provide Laidlaw with access to its shareholder lists. This is a
problem of Laidlaw's own creation since Laidlaw did not have to initiate the
calling of a special meeting before its securities were subject to an effective
registration statement.

Safety-Kleen further seeks a declaration from this Court that Laidlaw's
request for a shareholder meeting regarding its voting rights under Wis. Stat.
sec. 180.1150 fails to satisfy the notice requirements of Wis. Stat. sec.
180.1150(4)(e), which requires detailed disclosure of the financing arrangements
for its exchange offer.

JURISDICTION AND VENUE

1. This action arises under Section 5(b)(1) of the Securities Act of 1933,
15 U.S.C. sec. 77e(b)(1), and Wis. Stat. sec. 180.1150.

2. This Court has jurisdiction over this action pursuant to 28 U.S.C. sec.
1331, under the supplemental jurisdiction provisions of 28 U.S.C. sec. 1367, and
under the declaratory judgment provisions of 28 U.S.C. sec.sec. 2201 and 2202.

3. Venue lies in the Northern District of Illinois pursuant to 28 U.S.C.
sec. 1391(b) and (c), in that the defendant is subject to the personal
jurisdiction of the United States District Court for the Northern District of
Illinois, and initiated its demand for a meeting in this District.
<PAGE> 2

THE PARTIES

4. Plaintiff Safety-Kleen is a Wisconsin corporation with its principal
place of business in Elgin, Illinois.

5. Defendant Laidlaw is a Delaware corporation with its principal place of
business in Columbia, South Carolina.

THE LAIDLAW EXCHANGE OFFER

6. On November 13, 1997, Laidlaw filed a Form S-4 with the Securities and
Exchange Commission for the purpose of registering Laidlaw shares. (See Exhibit
A.) By that filing, Laidlaw announced its offer to acquire each outstanding
share of Safety-Kleen in exchange for $14 and 2.4 shares of the stock subject to
the S-4.

7. Pursuant to Section 8(a) of the Securities Act of 1933, 15 U.S.C. sec.
77h(a), "the effective date of a registration statement shall be the 20th day
after the filing thereof." However, Laidlaw has requested a delay in the
effectiveness of its registration. (See Exhibit A, at 2.) Accordingly, Laidlaw's
registration is not yet effective, and it is not presently determinable when
that registration will become effective.

THE WISCONSIN CONTROL SHARE VOTING REGISTRATION STATUTE

8. Section 180.1150(2) of the Wisconsin Statutes provides that "the voting
power of shares of an issuing public corporation held by any person . . . in
excess of 20% of the voting power in the election of directors shall be limited
to 10% of the full voting power of those shares." As a Wisconsin corporation,
Safety-Kleen is subject to the provisions of sec. 180.1150(2).

9. Pursuant to Wis. Stat. sec. 180.1150(5)(c), regular voting power may be
restored if, at a shareholder meeting at which a quorum is present, "a majority
of the voting power of shares represented at the meeting and entitled to vote on
the subject matter approve[s] [a] resolution" calling for a restoration of
regular voting power. Under Wis. Stat. sec. 180.1150(5)(a), such a shareholder
meeting must be scheduled within certain time limits once proper notice and a
proposed resolution are presented to a corporation. The required notice must
comply with certain disclosure requirements set forth in Wis. Stat. sec.
180.1150(4).

10. On November 13, 1997, Laidlaw delivered to Safety-Kleen a document
captioned "Notice Pursuant to Section 180.1150 of the Wisconsin Statutes." (See
Exhibit B.) Laidlaw attached to this document a proposed shareholder resolution
providing that "regular voting power shall be restored for all Shares now held
or hereafter acquired by any of the Laidlaw Parties in accordance with Section
180.1150(5)(c) of the Wisconsin Statutes." (See Exhibit C.)

11. Wis. Stat. sec. 180.1602(2)(c) permits a shareholder who has validly
requested a shareholder meeting pursuant to sec. 180.1150 to obtain the "record
of shareholders" of a corporation.

12. On November 13, 1997, Laidlaw also delivered to Safety-Kleen a letter
demanding the right to inspect and copy Safety-Kleen's records of its
shareholders purportedly pursuant to Wis. Stat. sec. 180.1602(2)(c). (See
Exhibit D.) According to the letter, "The purposes of this demand are to enable
Laidlaw to communicate with its fellow Company shareholders on matters relating
to their mutual interests as shareholders, including, but not limited to, (a)
communicating with the shareholders of the Company regarding the Notice dated
November 13, 1997, and served on the Company, pursuant to Section 180.1150(4) of
the Wisconsin Statues and (b) soliciting proxies in connection with the special
shareholders' meeting to be called as a consequence of the foregoing Notice."

13. Laidlaw publicly announced its request for a shareholder meeting "to
consider permitting [Laidlaw] to vote all shares acquired under its offer."
(SeeExhibit E.) This public announcement was a continuation of Laidlaw's prior
unlawful efforts to condition the market as to its exchange offer with public
statements and press releases dating to at least November 4, 1997, more than a
week before Laidlaw even filed its registration statement.
<PAGE> 3

14. Laidlaw's exchange offer will be conditioned upon full restoration of
voting rights as to all shares of Safety-Kleen which Laidlaw holds. Laidlaw
seeks to achieve restoration of the voting rights by soliciting proxies of
Safety-Kleen shareholders in connection with the requested special meeting, and
so has demanded Safety-Kleen's shareholder list.

COUNT I -- DECLARATORY RELIEF

15. Safety-Kleen restates the allegations set forth in paragraphs 1
through 14, inclusive, as though fully set forth herein.

16. An actual, immediate, and justiciable controversy exists between
Safety-Kleen and Laidlaw concerning the rights and obligations of the parties as
to Laidlaw's demand for access to Safety-Kleen's shareholder records.

17. Pursuant to sec. 5(b) of the Securities Act of 1933, 15 U.S.C. sec.
77e(b), "It shall be unlawful for any person, directly or indirectly: (1) To
make use of any means or instruments of transportation or communication in
interstate commerce or of the mails to carry or transmit any prospectus relating
to any security with respect to which a registration statement has been filed
under this title, unless such prospectus meet the requirements of Section 10" of
the Securities Act of 1933.

18. A "prospectus" is broadly defined under Section 2(10) of the
Securities Act of 1933, 15 U.S.C. sec. 77b(10), for purposes of securities whose
registration is not yet effective, as "any prospectus, notice, circular,
advertisement, letter, or communication, written or by radio or television,
which offers any security for sale or confirms the sale of any security . . . "

19. An "offer" is broadly defined under Section 2(3) of the Securities Act
of 1933, 15 U.S.C. sec. 77b(3), as "every attempt or offer to dispose of, or
solicitation of an offer to buy, a security or interest in a security, for
value." This definition is designed to preclude "attractive descriptions" of new
securities and their issuer. See Chris-Craft Industries, Inc. v. Bangor Punta
Corp., 426 F.2d 569, 574 (2d Cir. 1970).

20. Laidlaw's proxy solicitation, which has already commenced through
Laidlaw's public pronouncements and press releases, and which is designed to
facilitate and promote Laidlaw's exchange offer, constitutes an "offer to sell"
within the meaning of Section 2(3) of the Securities Act of 1933, 15 U.S.C. sec.
77b(3), and a "prospectus" within the meaning of Section 2(10) of the Securities
Act of 1933, 15 U.S.C. sec. 77b(10).

21. Laidlaw's proxy solicitation and the individual press releases fail to
comply with the requirements of Sections 5(b)(1) and 10 of the Securities Act of
1933, 15 U.S.C. sec. 77e(b)(1) and 77J, and thus constitute "premature offer[s]"
within the meaning of Chris Craft Industries, 426 F.2d at 574. See also Eckstein
v. Balcor Film Investors, 8 F.3d 1121, 1131 (7th Cir. 1993) ("The '33 Act
permits issuers . . . to engage in 'free writing' once the registration
statement becomes effective." (emphasis added)).

22. Safety-Kleen should not be obligated to turn over to Laidlaw its
shareholder records since Laidlaw desires such access to continue its premature
offers in violation of Section 5(b)(1) of the Securities Act of 1933, 15 U.S.C.
sec. 77e(b)(1). Safety-Kleen should not be required to facilitate acts in
violation of federal law.

WHEREFORE, Safety-Kleen respectfully requests that this Court enter an
order declaring that Laidlaw's actions to date and its intended proxy
solicitation are in violation of Section 5(b)(1) of the Securities Act of 1933,
15 U.S.C. sec. 77e(b)(1), and that Safety-Kleen need not comply with Laidlaw's
demand for shareholder records.

COUNT II -- DECLARATORY RELIEF

23. Safety-Kleen restates the allegations set forth in paragraphs 1
through 22, inclusive, as though fully set forth herein.
<PAGE> 4

24. An actual, immediate, and justiciable controversy exists between
Safety-Kleen and Laidlaw concerning the rights and obligations of the parties as
to Laidlaw's demand for a shareholder meeting to alter Laidlaw's voting rights
under Wis. Stat. sec. 180.1150.

25. Pursuant to Wis. Stat. sec. 180.1150(4), a person desiring a
shareholder meeting for purposes of restoring regular voting power must provide
notice containing, inter alia, "the circumstances, terms and conditions under
which shares representing in excess of 20% of the voting power were acquired or
are proposed to be acquired, set forth in reasonable detail, including the
source of funds or other consideration and other details of the financial
arrangements of the transactions."

26. Laidlaw's purported "Notice Pursuant to Section 180.1150" attempts to
provide the required notice of financial arrangements by reference to an
attached prospectus. (See Exhibit B.)

27. Laidlaw's prospectus fails to detail the actual financial arrangements
relating to its exchange offer, despite Laidlaw's repeated public statements
that its financing was in place. For instance, on November 3, 1997, Laidlaw
wrote to Safety-Kleen and released a letter stating, "We have fully committed
financing to complete the combination." (Exhibit A, at 26.)

28. According to the prospectus, "the terms of the definitive agreement"
relating to the financing "have not yet been finalized." (See Exhibit A, at 44.)
Without knowledge of these terms, Safety-Kleen's shareholders cannot fairly
evaluate Laidlaw's proxy solicitation and exchange offer.

29. The prospectus further states that the commitment of Laidlaw's lender
to provide the necessary credit for the exchange offer "is conditioned on, among
other things, the negotiation, execution and delivery of the Loan Agreement;
receipt of all necessary or desirable governmental, shareholder, and third party
consents; the absence of a material adverse change in the business assets,
operations, condition (financial or otherwise), or prospects of LES Acquisition,
Safety-Kleen and their respective subsidiaries on a consolidated basis; the
execution of definitive agreements relating to the Merger and the Offer;
satisfactory completion of due diligence examinations; prior or contemporaneous
repayment in full of all existing indebtedness of each of LES Acquisition and
Safety-Kleen; and the successful syndication of $400 million of the $1.8 billion
commitment; and after consummation of the transaction at closing, either (i)
Laidlaw Environmental shall hold a sufficient number of shares to effect the
Merger or (ii) the Merger shall have been or, concurrently with the closing,
shall be, consummated, and the surviving corporation shall be a wholly-owned
subsidiary of LES Acquisition." (Id. at 44-45 (emphasis added).)

30. As of today, there is no financing of the exchange offer, as
acknowledged in the prospectus, and Laidlaw fails to satisfy the requirements of
Wis. Stat. 180.1150(4)(e). Laidlaw is premature in its request for a meeting. As
a result of the long, and expressly nonexclusive, list of conditions necessary
to secure the financing Laidlaw requires, Safety-Kleen's shareholders cannot
reasonably anticipate whether the financing described in the prospectus will be
available under the terms set forth therein. Until they can, there is no right
to a special shareholder meeting.

31. As a result of the foregoing, Safety-Kleen will not provide a
shareholder list until the Court determines that a valid demand for a meeting
has been served.
<PAGE> 5

WHEREFORE, Safety-Kleen respectfully requests that this Court enter an
order declaring that Laidlaw's purported "Notice Pursuant to Section 180.1150 of
the Wisconsin Statutes" fails to comply with the requirements of Wis. Stat.
sec. 180.1150(4)(e), and that accordingly Safety-Kleen is not obligated to
schedule a shareholder meeting pursuant to Wis. Stat. sec. 180.1150(5)(a) or to
provide access to a shareholder list.

Respectfully submitted,

SAFETY-KLEEN CORPORATION

By:
----------------------------------
One of its Attorneys
Dated: November 17, 1997

OF COUNSEL
HAROLD C. HIRSHMAN, ESQ.
Attorney No. 1226290
CHRISTOPHER Q. KING, ESQ.
Attorney No. 6189835
GERALD E. FRADIN, ESQ.
Attorney No. 6204247
SONNENSCHEIN NATH & ROSENTHAL
8000 Sears Tower
233 S. Wacker Drive
Chicago, Illinois 60606-6404
(312) 876-8000

Attorneys for Plaintiff

<PAGE> 1

EXHIBIT 99(D)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
SAFETY-KLEEN CORPORATION,

Plaintiff,

LAIDLAW ENVIRONMENTAL SERVICES, INC.,

Defendant.

- ----------------------------------------------

LAIDLAW ENVIRONMENTAL SERVICES, INC.,
and LES ACQUISITION, INC.,
Counterplaintiff,
v.

SAFETY-KLEEN CORPORATION, No. 97 C 8003
Judge Joan B. Gottschall
Counterdefendant, and

RICHARD T. FARMER, PAUL D. SCHRAGE,
DONALD W. BRINCKMAN, MARCIA E.
WILLIAMS, W. GORDON WOOD, RUSSELL A.
GWILLIM, EDGAR D. JANNOTA and
KARL G. OTZEN,

Counterdefendants.

VERIFIED ANSWER, AFFIRMATIVE DEFENSES,
AND COUNTERCLAIM OF
LAIDLAW ENVIRONMENTAL SERVICES, INC. AND LES ACQUISITION, INC.

Defendant Laidlaw Environmental Services, Inc. ("Laidlaw
Environmental"), answers the Complaint of plaintiff Safety-Kleen
Corporation ("Safety-Kleen"), as follows:

COMPLAINT

On November 13, 1997, Laidlaw demanded the right to inspect and copy
Safety-Kleen's record of shareholders to solicit proxies and communicate
with shareholders regarding Laidlaw's exchange offer for Safety-Kleen
stock, made that same day. The securities that comprise a substantial
portion of the consideration in the exchange offer have not yet been
registered with the Securities and Exchange Commission. Accordingly,
Laidlaw is barred by Section 5(b)(1) of the Securities Act of 1933, 15
U.S.C. sec. 77e(b)(1), from communicating with Safety-Kleen's
shareholders about those securities through written means other than
through a prospectus complying with Sections 5(b)(1) and 10 of the
Securities Act of 1933, 15 U.S.C. sec.sec. 77e(b)(1) and 77j. To require
Safety-Kleen to provide its shareholder list under these circumstances
would be to require Safety-Kleen to facilitate a violation of the
federal securities laws. Safety-Kleen therefore seeks a declaration from
this Court that it need not provide Laidlaw with access to its
shareholder lists. This is a problem of Laidlaw with access to its
shareholder lists. This is a problem of Laidlaw's own creation since
Laidlaw did not have to initiate the calling of a special meeting before
its securities were subject to an effective registration statement.
<PAGE> 2

Safety-Kleen further seeks a declaration from this Court that Laidlaw's
request for a shareholder meeting regarding its voting rights under Wis.
Stat. sec. 180.1150 fails to satisfy the notice requirements of Wis.
Stat. sec. 180.1150(4)(e), which requires detailed disclosure of the
financing arrangements for its exchange offer.

ANSWER

The Complaint purports to set forth a "Summary" of its contents. This
"Summary" fails to comply with the requirements of Rule 10(b) of the Federal
Rules of Civil Procedure, and thus no answer is required.

COMPLAINT 1

This action arises under Section 5(b)(1) of the Securities Act of 1933,
15 U.S.C. sec. 77e(b)(1), and Wis. Stat. sec. 180.1150.

ANSWER 1

Laidlaw Environmental admits that Safety-Kleen purports to allege that this
action arises under Section 5(b)(1) of the Securities Act of 1933, 15 U.S.C.
sec. 77e(b)(1), and Wis. Stat. sec. 180.1150 but denies that any such action
lies in favor of Safety-Kleen. Laidlaw Environmental denies the remaining
allegations contained in paragraph 1 of the Complaint.

COMPLAINT 2

This Court has jurisdiction over this action pursuant to 28 U.S.C.
sec. 1331, under the supplemental jurisdiction provisions of 28 U.S.C.
sec. 1367, and under the declaratory judgment provisions of 28 U.S.C.
sec.sec. 2201 and 2202.

ANSWER 2

Laidlaw Environmental admits that Safety-Kleen purports to base
jurisdiction on the statutes identified in paragraph 2 of the Complaint and the
principles of supplemental jurisdiction. Laidlaw Environmental denies the
remaining allegations contained in paragraph 2 of the Complaint.

COMPLAINT 3

Venue lies in the Northern District of Illinois pursuant to 28 U.S.C.
sec. 1391(b) and (c), in that the defendant is subject to the personal
jurisdiction of the United States District Court for the Northern
District of Illinois, and initiated its demand for a meeting in this
District.

ANSWER 3

Laidlaw Environmental admits the allegations contained in paragraph 3 of
the Complaint.

COMPLAINT 4

Plaintiff Safety-Kleen is a Wisconsin corporation with its principal
place of business in Elgin, Illinois.

ANSWER 4

Laidlaw Environmental admits the allegations contained in paragraph 4 of
the Complaint.
<PAGE> 3

COMPLAINT 5

Defendant Laidlaw is a Delaware corporation with its principal place of
business in Columbia, South Carolina.

ANSWER 5

Laidlaw Environmental admits the allegations contained in paragraph 5 of
the Complaint.

COMPLAINT 6

On November 13, 1997, Laidlaw filed a Form S-4 with the Securities and
Exchange Commission for the purpose of registering Laidlaw shares. (See
Exhibit A.) By that filing, Laidlaw announced its offer to acquire each
outstanding share of Safety-Kleen in exchange for $14 and 2.4 shares of
the stock subject to the S-4.

ANSWER 6

Laidlaw Environmental admits the allegations contained in the first
sentence of paragraph 6 of the Complaint. Laidlaw Environmental further admits
that Safety-Kleen purports to attach a copy of the Form S-4 filed by Laidlaw
Environmental on November 13, 1997 as Exhibit A to the Complaint. Laidlaw
Environmental denies the remaining allegations contained in paragraph 6 of the
Complaint.

COMPLAINT 7

Pursuant to Section 8(a) of the Securities Act of 1933, 15 U.S.C.
sec. 77h(a), "the effective date of a registration statement shall be
the 20th day after the filing thereof." However, Laidlaw has requested a
delay in the effectiveness of its registration. (See Exhibit A, at 2.)
Accordingly, Laidlaw's registration is not yet effective, and it is not
presently determinable when that registration will become effective.

ANSWER 7

Laidlaw Environmental admits the allegations contained in paragraph 7 of
the Complaint.

COMPLAINT 8

Section 180.1150(2) of the Wisconsin Statutes provides that "the voting
power of shares of an issuing public corporation held by any
person . . . in excess of 20% of the voting power in the election of
directors shall be limited to 10% of the full voting power of those
shares." As a Wisconsin corporation, Safety-Kleen is subject to the
provisions of Section 180.1150(2).

ANSWER 8

Laidlaw Environmental admits that Safety-Kleen purports to quote from a
statute in paragraph 8 of the Complaint, but denies that Safety-Kleen has
accurately done so. Laidlaw Environmental lacks sufficient information to form a
belief as to whether Safety-Kleen is subject to the provisions of Section
180.1150(2), but denies that Safety-Kleen is subject to that provision solely on
the basis of Safety-Kleen's status as a Wisconsin corporation. Laidlaw
Environmental denies the remaining allegations contained in paragraph 8 of the
Complaint.
<PAGE> 4

COMPLAINT 9

Pursuant to Wis. Stat. sec. 180.1150(5)(c), regular voting power may be
restored if, at a shareholder meeting at which a quorum is present, "a
majority of the voting power of shares represented at the meeting and
entitled to vote on the subject matter approve[s] [a] resolution"
calling for a restoration of regular voting power. Under Wis. Stat.
sec. 180.1150(5)(a), such a shareholder meeting must be scheduled within
certain time limits once proper notice and a proposed resolution are
presented to a corporation. The required notice must comply with certain
disclosure requirements set forth in Wis. Stat. sec. 180.1150(4).

ANSWER 9

Laidlaw Environmental admits that Safety-Kleen purports to quote from a
statute in paragraph 9 of the Complaint. Laidlaw Environmental states that the
remaining allegations of paragraph 9 of the Complaint constitute the legal
conclusions of the pleader as to which no answer is required. To the extent an
answer is necessary, Laidlaw Environmental admits such allegations.

COMPLAINT 10

On November 13, 1997, Laidlaw delivered to Safety-Kleen a document
captioned "Notice Pursuant to Section 180.1150 of the Wisconsin
Statutes." (See Exhibit B.) Laidlaw attached to this document a proposed
shareholder resolution providing that "regular voting power shall be
restored for all Shares now held or hereafter acquired by any of the
Laidlaw Parties in accordance with Section 180.1150(5)(c) of the
Wisconsin Statutes." (See Exhibit C.)

ANSWER 10

Laidlaw Environmental admits the allegations contained in paragraph 10 of
the Complaint.

COMPLAINT 11

Wis. Stat. sec. 180.1602(2)(c) permits a shareholder who has validly
requested a shareholder meeting pursuant to Section 180.1150 to obtain
the "record of shareholders" of a corporation.

ANSWER 11

Laidlaw Environmental admits the allegations contained in paragraph 11 of
the Complaint.

COMPLAINT 12

On November 13, 1997, Laidlaw also delivered to Safety-Kleen a letter
demanding the right to inspect and copy Safety-Kleen's records of its
shareholders purportedly pursuant to Wis. Stat. sec. 180.1602(2)(c).
(See Exhibit D.) According to the letter, "The purposes of this demand
are to enable Laidlaw to communicate with its fellow Company
shareholders on matters relating to their mutual interests as
shareholders, including, but not limited to, (a) communicating with the
shareholders of the Company regarding the Notice dated November 13,
1997, and served on the Company, pursuant to Section 180.1150(4) of the
Wisconsin Statutes and (b) soliciting proxies in connection with the
special shareholders' meeting to be called as a consequence of the
foregoing Notice."

ANSWER 12

Laidlaw Environmental admits the allegations contained in paragraph 12 of
the Complaint.
<PAGE> 5

COMPLAINT 13

Laidlaw publicly announced its request for a shareholder meeting "to
consider permitting [Laidlaw] to vote all shares acquired under its
offer." (See Exhibit E.) This public announcement was a continuation of
Laidlaw's prior unlawful efforts to condition the market as to its
exchange offer with public statements and press releases dating to at
least November 4, 1997, more than a week before Laidlaw even filed its
registration statement.

ANSWER 13

Laidlaw Environmental admits that it publicly announced the filing of a
Form S-4 on November 13, 1997. Laidlaw Environmental further admits that in
paragraph 13 of the Complaint, Safety-Kleen purports to quote from Laidlaw
Environmental's November 13, 1997, press release and to attach a copy of the
press release as Exhibit E to the Complaint. Laidlaw Environmental denies the
remaining allegations contained in paragraph 13 of the Complaint.

COMPLAINT 14

Laidlaw's exchange offer will be conditioned upon full restoration of
voting rights as to all shares of Safety-Kleen which Laidlaw holds.
Laidlaw seeks to achieve restoration of the voting rights by soliciting
proxies of Safety-Kleen shareholders in connection with the requested
special meeting, and so has demanded Safety-Kleen's shareholder list.

ANSWER 14

Laidlaw Environmental admits the allegations contained in paragraph 14 of
the Complaint.

COUNT I -- DECLARATORY RELIEF

COMPLAINT 15

Safety-Kleen restates the allegations set forth in paragraphs 1 through
14, inclusive, as though fully set forth herein.

ANSWER 15

Laidlaw Environmental restates and realleges its answers set forth in
paragraphs 1 through 14, inclusive, as though fully set forth herein.

COMPLAINT 16

An actual, immediate, and justiciable controversy exists between
Safety-Kleen and Laidlaw concerning the rights and obligations of the
parties as to Laidlaw's demand for access to Safety-Kleen's shareholder
records.

ANSWER 16

Laidlaw Environmental admits the allegations contained in paragraph 16 of
the Complaint.

COMPLAINT 17

Pursuant to Section 5(b) of the Securities Act of 1933, 15 U.S.C.
sec. 77e(b), "It shall be unlawful for any person, directly or
indirectly: (1) To make use of any means or instruments of
transportation or communication in interstate commerce or of the mails
to carry or transmit any prospectus relating to
<PAGE> 6

any security with respect to which a registration statement has been
filed under this title, unless such prospectus meet the requirements of
Section 10" of the Securities Act of 1933.

ANSWER 17

Laidlaw Environmental admits that in paragraph 17 of the Complaint,
Safety-Kleen purports to cite and quote from a statute.

COMPLAINT 18

A "prospectus" is broadly defined under Section 2(10) of the Securities
Act of 1933, 15 U.S.C. sec. 77b(10), for purposes of securities whose
registration is not yet effective, as "any prospectus, notice, circular,
advertisement, letter, or communication, written or by radio or
television, which offers any security for sale or confirms the sale of
any security . . ."

ANSWER 18

Laidlaw Environmental admits that in paragraph 18 of the Complaint,
Safety-Kleen purports to cite and quote from a statute. Laidlaw Environmental
states that the remaining allegations contained in paragraph 18 of the Complaint
constitute the legal conclusions or conclusions of the pleader as to which no
answer is required. To the extent an answer is necessary, Laidlaw Environmental
denies such allegations.

COMPLAINT 19

An "offer" is broadly defined under Section 2(3) of the Securities Act
of 1933, 15 U.S.C. sec. 77b(3), as "every attempt or offer to dispose
of, or solicitation of an offer to buy, a security or interest in a
security, for value." This definition is designed to preclude
"attractive descriptions" of new securities and their issuer. See
Chris-Craft Industries, Inc. v. Bangor Punta Corp., 426 F.2d 569, 574
(2d Cir. 1970).

ANSWER 19

Laidlaw Environmental admits that in paragraph 19 of the Complaint,
Safety-Kleen purports to cite and quote from a statute. Laidlaw Environmental
states that the remaining allegations contained in paragraph 19 of the Complaint
constitute the conclusions or opinions of the pleader as to which no answer is
required. To the extent an answer is necessary, Laidlaw Environmental denies
such allegations.

COMPLAINT 20

Laidlaw's proxy solicitation, which has already commenced through
Laidlaw's public pronouncements and press releases, and which is
designed to facilitate and promote Laidlaw's exchange offer, constitutes
an "offer to sell" within the meaning of Section 2(3) of the Securities
Act of 1933, 15 U.S.C. sec. 77b(3), and a "prospectus" within the
meaning of Section 2(10) of the Securities Act of 1933, 15 U.S.C.
Section 77b(10).

ANSWER 20

Laidlaw Environmental states that the allegations contained in paragraph 20
of the Complaint constitute the legal conclusions of the pleader as to which no
answer is required. To the extent an answer is necessary, Laidlaw Environmental
denies such allegations.
<PAGE> 7

COMPLAINT 21

Laidlaw's proxy solicitation and the individual press releases fail to
comply with the requirements of Sections 5(b)(1) and 10 of the
Securities Act of 1933, 15 U.S.C. Section Section 77e(b)(1) and 77j, and
thus constitute "premature offer[s]" within the meaning of Chris-Craft
Industries, 426 F.2d at 574. See also Eckstein v. Balcor Film Investors,
8 F.3d 1121, 1131 (7th Cir. 1993) ("The '33 Act permits issuers . . . to
engage in 'free writing', once the registration statement becomes
effective." (emphasis added)).

ANSWER 21

Laidlaw Environmental states that the allegations contained in paragraph 21
of the Complaint constitute the legal conclusions of the pleader as to which no
answer is required. To the extent an answer is necessary, Laidlaw Environmental
denies such allegations.

COMPLAINT 22

Safety-Kleen should not be obligated to turn over to Laidlaw its
shareholder records since Laidlaw desires such access to continue its
premature offers in violation of Section 5(b)(1) of the Securities Act
of 1933, 15 U.S.C. Section 77e(b)(1). Safety-Kleen should not be
required to facilitate acts in violation of federal law.

ANSWER 22

Laidlaw Environmental states that the allegations contained in paragraph 22
of the Complaint constitute the conclusions or opinions of the pleader as to
which no answer is required. To the extent an answer is necessary, Laidlaw
Environmental denies such allegations.

COUNT II -- DECLARATORY RELIEF

COMPLAINT 23

Safety-Kleen restates the allegations set forth in paragraphs 1 through
22, inclusive, as though fully set forth herein.

ANSWER 23

Laidlaw Environmental restates and realleges its answers set forth in
paragraphs 1 through 22, inclusive, as though fully set forth herein.

COMPLAINT 24

An actual, immediate, and justiciable controversy exists between
Safety-Kleen and Laidlaw concerning the rights and obligations of the
parties as to Laidlaw's demand for a shareholder meeting to alter
Laidlaw's voting rights under Wis. Stat. Section 180.1150.

ANSWER 24

Laidlaw Environmental admits the allegations contained in paragraph 24 of
the Complaint.
<PAGE> 8

COMPLAINT 25

Pursuant to Wis. Stat. Section 180.1150(4), a person desiring a
shareholder meeting for purposes of restoring regular voting power must
provide notice containing, inter alia, "the circumstances, terms and
conditions under which shares representing in excess of 20% of the
voting power were acquired or are proposed to be acquired, set forth in
reasonable detail, including the source of funds or other consideration
and other details of the financial arrangements of the transactions."

ANSWER 25

Laidlaw Environmental admits that Safety-Kleen purports to cite and quote
from a statute in paragraph 25 of the Complaint. Laidlaw Environmental states
that the remaining allegations of paragraph 25 of the Complaint constitute legal
conclusions as to which no answer is required. To the extent an answer is
necessary, Laidlaw Environmental denies such allegations.

COMPLAINT 26

Laidlaw's purported "Notice Pursuant to Section 180.1150" attempts to
provide the required notice of financial arrangements by reference to an
attached prospectus. (See Exhibit B.)

ANSWER 26

Laidlaw Environmental affirmatively states that the November 13, 1997,
Notice satisfies all requirements set forth in Wis. Stat. Section 180.1150.
Laidlaw Environmental denies the allegations contained in paragraph 26 of the
Complaint to the extent that they vary from this affirmative statement.

COMPLAINT 27

Laidlaw's prospectus fails to detail the actual financial arrangements
relating to its exchange offer, despite Laidlaw's repeated public
statements that its financing was in place. For instance, on November 3,
1997, Laidlaw wrote to Safety-Kleen and released a letter stating, "We
have fully committed financing to complete the combination." (Exhibit A,
at 26.)

ANSWER 27

Laidlaw Environmental admits that it sent a letter to Safety-Kleen dated
November 3, 1997, from which paragraph 27 purports to quote quotes. Laidlaw
Environmental denies the remaining allegations contained in paragraph 27 of the
Complaint.

COMPLAINT 28

According to the prospectus, "the terms of the definitive agreement"
relating to the financing "have not yet been finalized." (See Exhibit A,
at 44.) Without knowledge of these terms, Safety-Kleen's shareholders
cannot fairly evaluate Laidlaw's proxy solicitation and exchange offer.

ANSWER 28

Laidlaw Environmental admits that in paragraph 28 of the Complaint,
Safety-Kleen purports to quote from the prospectus included in the Form S-4
filed by Laidlaw Environmental on November 13, 1997. Laidlaw Environmental
denies the remaining allegations contained in paragraph 28 of the Complaint.
<PAGE> 9

COMPLAINT 29

The prospectus further states that the commitment of Laidlaw's lender to
provide the necessary credit for the exchange offer "is conditioned on,
among other things, the negotiation, execution and delivery of the Loan
Agreement; receipt of all necessary or desirable governmental,
shareholder, and third party consents; the absence of a material adverse
change in the business assets, operations, condition (financial or
otherwise), or prospects of LES Acquisition, Safety-Kleen and their
respective subsidiaries on a consolidated basis; the execution of
definitive agreements relating to the Merger and the Offer; satisfactory
completion of due diligence examinations; prior or contemporaneous
repayment in full of all existing indebtedness of each of LES
Acquisition and Safety-Kleen; and the successful syndication of $400
million of the $1.8 billion commitment; and after consummation of the
transaction at closing, either (i) Laidlaw Environmental shall hold a
sufficient number of shares to effect the Merger or (ii) the Merger
shall have been or, concurrently with the closing, shall be,
consummated, and the surviving corporation shall be a wholly-owned
subsidiary of LES Acquisition." (Id. at 44-45 (emphasis added).)

ANSWER 29

Laidlaw Environmental admits that in paragraph 29 of the Complaint,
Safety-Kleen purports to quote from the prospectus included in the Form S-4
filed by Laidlaw Environmental on November 13, 1997. Laidlaw Environmental
denies the remaining allegations contained in paragraph 29 of the Complaint.

COMPLAINT 30

As of today, there is no financing of the exchange offer, as
acknowledged in the prospectus, and Laidlaw fails to satisfy the
requirements of Wis. Stat. 180.1150 (4)(e) [sic]. Laidlaw is premature
in its request for a meeting. As a result of the long, and expressly
nonexclusive, list of conditions necessary to secure the financing
Laidlaw requires, Safety-Kleen's shareholders cannot reasonably
anticipate whether the financing described in the prospectus will be
available under the terms set forth therein. Until they can, there is no
right to a special shareholder meeting.

ANSWER 30

Laidlaw Environmental denies the allegations contained in the first, second
and third sentences of paragraph 30 of the Complaint. Laidlaw Environmental
states that the remaining allegations contained in paragraph 30 of the Complaint
constitute the conclusions or opinions of the pleader as to which no answer is
required. To the extent that an answer is necessary, Laidlaw Environmental
denies such allegations.

COMPLAINT 31

As a result of the foregoing, Safety-Kleen will not provide a
shareholder list until the Court determines that a valid demand for a
meeting has been served.

ANSWER 31

Laidlaw Environmental states that paragraph 31 of the Complaint contains
the declared intentions of the pleader as to which no answer is required. To the
extent an answer is necessary, Laidlaw Environmental admits that Safety-Kleen
has refused to provide Laidlaw Environmental with its record of shareholders.

AFFIRMATIVE DEFENSES

FIRST AFFIRMATIVE DEFENSE

The Complaint fails to state a claim against Laidlaw Environmental upon
which relief can be granted.
<PAGE> 10

SECOND AFFIRMATIVE DEFENSE

Safety-Kleen lacks standing to assert the claims contained in the
Complaint.

THIRD AFFIRMATIVE DEFENSE

The claims asserted against Laidlaw Environmental are barred, in whole or
in part, by the doctrine of unclean hands.

COUNTERCLAIM

Defendant-counterplaintiff, Laidlaw Environmental Services, Inc. ("Laidlaw
Environmental") and additional counterplaintiff LES Acquisition, Inc. ("LES"),
for their counterclaim against the plaintiff-counterdefendant Safety-Kleen Corp.
("Safety-Kleen") and the additional counterdefendants Richard T. Farmer, Paul D.
Schrage, Donald W. Brinckman, Marcia E. Williams, W. Gordon Wood, Russell A.
Gwillim, Edgar D. Jannota and Karl G. Otzen (the "Director Defendants"), allege
the following:

(Nature of the Action)

1. Counterplaintiffs Laidlaw Environmental and LES bring these claims
directly and derivatively to redress and enjoin the unlawful conduct of the
Director Defendants and Safety-Kleen designed to frustrate any offer by
Laidlaw Environmental to acquire Safety-Kleen. The Director Defendants have
persisted in a course of wrongful conduct by using corporate resources to
avoid complying with their obligations under Wisconsin law and, in the
latest of a series of violations of their fiduciary duties of loyalty and
care to the Safety-Kleen shareholders, have agreed to sell Safety-Kleen for
an inadequate price of $27 per share in a leveraged buyout transaction (the
"Buyout Transaction") after a sales "process" that unlawfully excluded
Laidlaw Environmental, which had already offered approximately $26 per
share and had informed Safety-Kleen of its willingness to consider making a
higher offer. Laidlaw Environmental has now offered $30 per share to all
Safety-Kleen shareholders. The proposed acquiror in the Buyout Transaction
is a highly leveraged shell corporation (the "Buyout Vehicle") created by
Philip Services Corp. ("Philip"), Blackstone Management Associates III,
L.P. ("Blackstone") and Apollo Advisors L.P. ("Apollo") (collectively, the
"Buyout Group"). The principal feature of the Buyout Transaction is that,
while Safety-Kleen's public shareholders would receive an inferior price
for their shares, Safety-Kleen's management would retain their positions
and compensation. Indeed, there have been reports that members of
management will become investors in the Buyout Group.

2. As part of this unlawful and unfair Buyout Transaction, and in
order to make it prohibitively expensive for Laidlaw Environmental or
anyone else to outbid that transaction, Safety-Kleen has agreed to pay the
Buyout Group an unnecessary, excessive and unreasonable "break-up" fee of
up to $75 million. That break-up fee would be payable if, among other
circumstances, the Safety-Kleen shareholders voted to reject the inadequate
Buyout Transaction, and Safety-Kleen subsequently entered into a merger
with Laidlaw Environmental. The unlawful break-up fee constitutes a gross
waste of corporate assets of Safety-Kleen, as well as a "poll tax" upon
Safety-Kleen shareholders should they choose to vote against the pending
merger in order to accept Laidlaw Environmental's higher offer. In
addition, because Laidlaw Environmental's $30 per share offer is subject to
reduction for any break-up fee paid to the Buyout Group, this breakup fee
would come out of the pockets of Safety-Kleen's shareholders.

3. Counterplaintiffs seek declaratory and injunctive relief preventing
Safety-Kleen and the Director Defendants from proceeding with the unfair
and unlawful Buyout Transaction and from carrying out the terms of
Safety-Kleen's merger agreement with the Buyout Group, particularly
including the unlawful break-up fee and expense reimbursement provisions
contained therein. Counterplaintiffs also seek an order requiring the
Director Defendants to account to Safety-Kleen for all damages caused by
their approval of the Buyout Transaction and an order declaring that the
Director Defendants may not be indemnified by Safety-Kleen for any
judgments, settlements or attorneys' fees in this action.
<PAGE> 11

4. This action also seeks declaratory and injunctive relief requiring
Safety-Kleen to call a special meeting of shareholders, as requested by
Laidlaw Environmental pursuant to Wis. Stat. sec. 180.1150(4), and to
provide Laidlaw Environmental with a copy of Safety-Kleen's shareholder
list, as required by Wis. Stat. sec. 180.1601.

(Parties)

5. Counterplaintiff Laidlaw Environmental is a Delaware corporation
with its principal place of business in Columbia, South Carolina. Laidlaw
Environmental provides hazardous and industrial waste management services
throughout North America. It is the beneficial owner of 601,100 shares of
Safety-Kleen common stock. Counterplaintiff LES is an indirect,
wholly-owned subsidiary of Laidlaw Environmental formed for the purpose of
carrying out the proposed acquisition of Safety-Kleen by Laidlaw
Environmental. LES is a Delaware corporation with its principal place of
business in Columbia, South Carolina.

6. Counterdefendant Safety-Kleen is a Wisconsin corporation with its
principal place of business in Elgin, Illinois. Safety-Kleen provides
recycling and waste services to automotive/retail repair, industrial,
imaging and other business sectors. Safety-Kleen has a class of stock that
is registered and traded on a national securities exchange.

7. The Director Defendants are members of Safety-Kleen's Board of
Directors. Counterplaintiffs are informed and believe that none is a
resident of the state of Delaware or South Carolina.

(Jurisdiction and Venue)

8. This Court has jurisdiction over this counterclaim pursuant to the
declaratory judgment statute, 28 U.S.C. sec.sec. 2201-02, and 28 U.S.C.
sec. 1332(a)(1), as the amount in controversy exceeds the sum of $75,000,
exclusive of interest and costs, and the suit is between citizens of
different states. The claims at issue in this lawsuit arise out of the same
transactions and occurrences that are the subject matter of the lawsuit
filed by Safety-Kleen against Laidlaw Environmental, giving this Court
supplemental jurisdiction over the state law claims alleged herein under
Fed. R. Civ. P. 13(a) and 28 U.S.C. sec. 1367(a).

9. Venue as to Safety-Kleen is proper within this judicial district
under 28 U.S.C. sec. 1391(b) and (c), because Safety-Kleen is a corporation
whose principal place of business is in this district, and it is subject to
jurisdiction here. It is therefore deemed to reside in this district.

10. Venue as to the Director Defendants is proper within this judicial
district under 28 U.S.C. sec. 1391(a) because at least one of the
counterdefendants resides within this judicial district and a substantial
part of the events and omissions giving rise to the claims occurred in this
judicial district.

(Conduct Complained Of)

11. On August 8, 1997, Safety-Kleen announced that its Board of
Directors had engaged the services of William Blair & Company ("William
Blair"), an investment banking firm, to advise Safety-Kleen and to manage
the process of "exploring strategic options for enhancing shareholder
value." That phrase is generally understood by the financial markets to
mean that the company will entertain merger and acquisition offers. That is
how the market treated Safety-Kleen's announcement, as the price of its
stock jumped over seven percent from the day prior, to the day following
the announcement.

12. As part of its efforts to solicit merger and acquisition offers
for Safety-Kleen, William Blair sent a proposed confidentiality and
"standstill" agreement (the "Standstill Agreement") to potential bidders.
Because Laidlaw Environmental was one -- indeed probably the
most -- logical candidate to acquire Safety-Kleen, one of Laidlaw
Environmental's investment bankers, Raymond James & Associates, Inc.
("Raymond James") obtained the Standstill Agreement from William Blair.
This Standstill Agreement would have prohibited Laidlaw Environmental from
making any offer to acquire Safety-Kleen during the
<PAGE> 12

next two years without the approval of Safety-Kleen's directors. William
Blair stated that a confidential offering circular describing Safety-Kleen
and its business would be distributed only to parties that executed the
Standstill Agreement. Laidlaw Environmental was willing to sign a
confidentiality agreement, but would not agree to give Safety-Kleen's
directors the ability to prohibit any offer by Laidlaw Environmental for
two years. Safety-Kleen thereupon refused to provide Laidlaw Environmental
with a copy of the offering circular.

13. During September and October 1997, Laidlaw Environmental
repeatedly requested a meeting of the two companies and their advisors so
that Laidlaw Environmental could fully describe why a business combination
was in both companies' shareholders' best interests. Safety-Kleen continued
to refuse to discuss a possible transaction unless Laidlaw Environmental
signed the Standstill Agreement, which would give Safety-Kleen's directors
absolute control over Laidlaw Environmental's ability to make an offer.

14. On November 3, 1997, the Board of Directors of Laidlaw
Environmental approved making an offer to exchange each outstanding common
share of Safety-Kleen for $14 net per share in cash and 2.4 shares of
common stock of Laidlaw Environmental (the "Initial Offer"), to be followed
by a merger of Laidlaw Environmental and Safety-Kleen. The Initial Offer
had a value of approximately $26 per share based on the closing price of
Laidlaw Environmental common stock on that day. James R. Bullock, the
Chairman of Laidlaw Environmental, sent a letter to Donald W. Brinckman,
the Chairman and Chief Executive Officer of Safety-Kleen informing
Safety-Kleen of Laidlaw Environmental's proposal and offering to execute a
confidentiality agreement, provided such agreement did not contain a
standstill provision. The letter also informed Mr. Brinckman that Laidlaw
Environmental had executed a commitment letter with Toronto-Dominion Bank
to provide all necessary financing for the Initial Offer and again asked
Mr. Brinckman and the Safety-Kleen Board of Directors to meet with
representatives of Laidlaw Environmental to discuss the possibility of a
mutually beneficial negotiated transaction.

15. Later on November 3, 1997, after receipt of Mr. Bullock's letter,
Mr. Brinckman delivered a letter to Mr. Bullock again insisting that if
Laidlaw Environmental executed a Standstill Agreement the Safety-Kleen
Board of Directors would consider Laidlaw Environmental's proposal along
with others received by Safety-Kleen.

16. On November 4, 1997, Laidlaw Environmental publicly announced its
intention to pursue the Initial Offer.

17. On November 5, 1997, following the public announcement of the
Initial Offer, Mr. Brinckman and other representatives of Safety-Kleen
finally met with Mr. Bullock and a representative of Bear Stearns, an
investment banking firm advising Laidlaw Environmental. Mr. Bullock
proposed that Laidlaw Environmental and Safety-Kleen sign a mutual
confidentiality agreement that did not contain a standstill provision so
that they could share information with each other, but Safety-Kleen
rejected this proposal and no substantive discussions occurred.

(Laidlaw Environmental's Request for
a Shareholders' Meeting and Shareholder List)

18. Wisconsin's control shares voting statute provides that "the
voting power of shares of a resident domestic corporation held by any
person . . . in excess of 20% of the voting power in the election of
directors shall be limited to 10% of the full voting power of those
shares." Wis. Stat. sec. 180.1150(2) (1997). A shareholder which
anticipates acquiring in excess of 20% of the voting power may request a
vote in advance to restore the voting power of its shares by delivering a
Notice of Meeting and Resolution to the Company. Wis. Stat.
sec. 180.1150(4) (1997).

19. Because Safety-Kleen may be a "resident domestic corporation" as
that term is defined by Wis. Stat. sec. 180.1150(1)(c), the Initial Offer
was conditioned on Safety-Kleen's shareholders voting to restore the voting
rights of shares to be acquired by Laidlaw Environmental. On November 13,
1997, Laidlaw Environmental sent a proper Notice of Meeting and Resolution
to Safety-Kleen (the "November 13,
<PAGE> 13

1997 Notice") in order to obtain such a vote of Safety-Kleen's
shareholders. A copy of the November 13, 1997 Notice is attached as Exhibit
A. Although the statute does not give a Wisconsin resident domestic
corporation any discretion to refuse such a request, Safety-Kleen has
refused to hold a special shareholders' meeting.

20. Safety-Kleen also has unlawfully refused to provide Laidlaw
Environmental with Safety-Kleen's record of shareholders in order to
frustrate Laidlaw Environmental's ability to communicate with its fellow
shareholders with respect to its exchange offer. Wisconsin law requires
corporations organized under the laws of the State of Wisconsin to maintain
a record of its shareholders. Each corporation must make this record
available to any shareholder who requests it pursuant to applicable
Wisconsin statutes. Wis. Stat. sec. 180.1601 (1997). Accordingly, on
November 13, 1997, Laidlaw Environmental also wrote to Mr. Brinckman
exercising its right, as a shareholder of Safety-Kleen, to inspect and copy
the record of shareholders of Safety-Kleen and to inspect other documents.
Laidlaw Environmental offered to bear the reasonable costs incurred by
Safety-Kleen in connection with the production of that information. Laidlaw
Environmental explained that the purpose of its demand was to enable
Laidlaw Environmental to communicate with its fellow Safety-Kleen
shareholders on matters relating to their mutual interests as shareholders
including, but not limited to: (a) communicating with the shareholders of
Safety-Kleen regarding the November 13, 1997 Notice pursuant to Section
180.1150 of the Wisconsin Business Corporation Law; and (b) soliciting
proxies in connection with the Special Shareholders' Meeting to be called
pursuant to the November 13, 1997 Notice. A copy of Laidlaw Environmental's
demand is attached as Exhibit B. Safety-Kleen has rejected Laidlaw
Environmental's demand for its shareholder list.

21. On November 17, 1997 Safety-Kleen filed this action seeking a
declaration that it was not required to call the special meeting of
shareholders or give the shareholder list to Laidlaw Environmental.

(The Buyout Transaction)

22. On November 20, 1997, without ever discussing with Laidlaw
Environmental whether it would increase the Initial Offer (which it had
indicated it was willing to consider), Safety-Kleen announced that its
Board had approved a definitive merger agreement (the "Merger Agreement")
with the Buyout Vehicle, pursuant to which Safety-Kleen's shareholders
would receive $27 per share. In so doing, the Director Defendants not only
approved the acquisition of Safety-Kleen at an inadequate price, knowing
that Laidlaw Environmental was willing to consider increasing its bid, but
also agreed to numerous one-sided, onerous conditions that benefit the
Buyout Group and impose substantial obstacles, including prohibitive
additional costs, on a competing bidder, in breach of the Director
Defendants' fiduciary duties to the public shareholders of Safety-Kleen. A
copy of the Merger Agreement is attached as Exhibit C.

23. The Merger Agreement includes the following provisions that have
the purpose and effect of improperly benefiting the Buyout Group and/or the
Director Defendants and impeding competing offers, all to the detriment of
Safety-Kleen's shareholders:

(a) If the Merger Agreement is terminated by Safety-Kleen under a
variety of circumstances, including a decision by Safety-Kleen to accept
a better offer, Safety-Kleen must pay the Buyout Group a fee of $50
million plus up to an additional $25 million to cover the Buyout Group's
purported expenses (the "break-up fee"). This break-up fee totals nearly
5% of the total value of the transaction, twice the level approved by
courts in other transactions. The break-up fee is to be paid even if the
Safety-Kleen shareholders exercise their rights to vote down the Buyout
Transaction in order to accept a better offer from Laidlaw Environmental
or someone else.

(b) If Safety-Kleen receives an offer that is superior to the
Buyout Proposal, it may not accept that offer without first giving the
Buyout Group the chance to match it. This imposes a strong disincentive
for any competing bidder, which is required to make a proposal or
negotiate with Safety-Kleen (if Safety-Kleen agrees to negotiate)
knowing that the Buyout Group can win any bidding contest simply by
agreeing to match the best other offer.
<PAGE> 14

(c) The Merger Agreement acknowledges that Safety-Kleen may pay up
to $45.7 million in "severance pay" to Safety-Kleen's officers and
employees even if all of them remain employed at the same salaries and
in the same locations. The Merger Agreement provides no information
about the amount of "severance pay" that Safety-Kleen may pay if
officers or employees actually lose their jobs or are transferred to
another location.

24. The Director Defendants did not agree to these provisions in
return for a fully-priced, beneficial transaction for Safety-Kleen's
shareholders. Rather, the Buyout Transaction offers a $27 per share price
that only slightly exceeds Laidlaw Environmental's Initial Offer and is
significantly below the $30 per share that Laidlaw Environmental has since
offered (as described below), and would have offered if Safety-Kleen had
entered into negotiations. Moreover, although the Merger Agreement imposes
huge penalties on Safety-Kleen if its shareholders decide to reject the
Buyout Transaction in favor of a better deal, the Buyout Transaction itself
is subject to numerous contingencies:

(a) The Buyout Transaction is contingent upon the Buyout Group
obtaining both equity and debt financing for the merger. Philip, Apollo
and Blackstone are under no obligation to ensure that financing is
available. Such a condition is virtually unheard of in a public company
acquisition.

(b) Because the Buyout Vehicle will be so highly leveraged (i.e.,
will have an unusually large amount of debt financing), the Buyout
Transaction is contingent upon Safety-Kleen receiving an expert's
opinion confirming that it will remain solvent after the acquisition, so
that the Director Defendants will not be exposed to liability to
Safety-Kleen's creditors for participating in a fraudulent conveyance.
This condition is also highly unusual in a public company acquisition.

(c) Unlike most public company merger agreements, which require the
parties to close the transaction unless there is an outstanding court
order prohibiting them from doing so, the Merger Agreement gives the
Buyout Group the right not to close if there is any litigation
"instituted or pending" that challenges the Buyout Transaction and has a
"substantial likelihood of success."

(d) The Merger Agreement was executed on behalf of the Buyout Group
only by the Buyout Vehicle, a shell corporation. Philip, Apollo and
Blackstone are not parties to the Merger Agreement and have no
obligation to proceed with the Buyout Transaction. Thus, even if the
Buyout Group breaches the Merger Agreement, Safety-Kleen's only recourse
would be against an empty shell corporation.

25. Taken together, these provisions demonstrate that the Director
Defendants, while refusing to negotiate or discuss a merger with Laidlaw
Environmental, agreed to a one-sided deal at an inadequate price which
makes it difficult, if not impossible, for Safety-Kleen's shareholders to
reap the benefits of a better proposal from Laidlaw Environmental or
another bidder. Both the nature of the Buyout Transaction and the process
by which the Director Defendants approved it make clear that the Director
Defendants have acted on an uninformed basis and that their actions are not
the product of a valid business judgment. Their conduct is subject to
enhanced scrutiny as a result.

(Laidlaw Environmental's New Offer)

26. On November 20, 1997, within hours after Safety-Kleen's
announcement of the Buyout Transaction, Laidlaw Environmental's Mr. Bullock
wrote to Safety-Kleen's Mr. Brinckman and increased Laidlaw Environmental's
offer to $30 per share, consisting of $15 in cash and $15 in Laidlaw
Environmental common stock (the "New Offer"). This proposal, which was made
before Safety-Kleen publicly filed the Merger Agreement and thus without
knowledge of its specific terms and conditions, is subject to adjustment
for any "break-up fees, new severance arrangements and other expenses
Safety-Kleen may have incurred in connection with its agreement with Philip
Services and others."

27. Despite Laidlaw Environmental's New Offer, which represents a 68%
premium to Safety-Kleen's closing price on the date prior to Safety-Kleen's
August 8th announcement and an 11% premium over the price to be paid in the
Buyout Transaction, and despite a subsequent announcement by the
<PAGE> 15

Buyout Group that it will not increase its price, Safety-Kleen has
continued to refuse to negotiate with Laidlaw Environmental.

COUNT I

(DECLARATORY RELIEF)

28. Laidlaw Environmental and LES repeat and reallege the allegations
in paragraphs 1 through 27, inclusive.

29. Laidlaw Environmental's November 13, 1997 Notice fully complies
with Wis. Stat. sec. 180.1150(4).

30. Laidlaw Environmental's November 13, 1997 Notice properly
contained: (a) the identity of the person desiring a shareholder vote; (b)
a statement that the Resolution and Notice were submitted under Wis. Stat.
sec. 180.1150(4); (c) the number of shares of Safety-Kleen that are owned
by Laidlaw Environmental; (d) a specification of the voting power Laidlaw
Environmental proposes to acquire and for which shareholder approval is
sought; (e) the circumstances, terms and conditions under which shares
representing in excess of 20% of the voting power are proposed to be
acquired, including the source of funds and other details of the financial
arrangement of the transaction; and (f) the terms of the proposed
transaction.

31. Pursuant to Wis. Stat. sec. 180.1150(5)(a), the board of directors
has 10 days after receipt of the notice and resolution to fix the date on
which the special shareholders' meeting will be held. Such meeting must be
held no later than 50 days after receipt of the notice and resolution.

32. On November 17, 1997, Safety-Kleen filed a complaint against
Laidlaw Environmental, seeking a declaratory order than Safety-Kleen has no
obligation to call a special shareholders' meeting in response to Laidlaw
Environmental's Notice of Meeting and Resolution.

33. An actual, immediate and justiciable controversy exists between
Safety-Kleen and Laidlaw Environmental concerning Laidlaw Environmental's
right to demand that Safety-Kleen call a special shareholders' meeting, and
an order should be issued declaring that Safety-Kleen is obliged to hold
such a special shareholders' meeting.

COUNT II

(VIOLATION OF WIS. STAT. SEC. 180.1602(2)(C))

34. Laidlaw Environmental and LES repeat and reallege the allegations
in paragraphs 1 through 33, inclusive.

35. Laidlaw Environmental's November 13, 1997, demand to inspect and
copy Safety-Kleen's shareholder list was properly submitted to Safety-Kleen
in accordance with Wis. Stat. sec. 180.0141.

36. Laidlaw Environmental's demand was made in good faith and for a
proper purpose.

37. Laidlaw Environmental cannot effectively communicate with its
fellow Safety-Kleen shareholders and prepare for the special shareholders'
meeting, which Safety-Kleen is obligated to call, without a copy of the
shareholder lists. Safety-Kleen's failure to provide Laidlaw Environmental
with a copy of its shareholder lists puts Laidlaw Environmental at an
unlawful disadvantage in its efforts to effect a merger with Safety-Kleen.

38. Pursuant to Wis. Stat. sec. 180.1604, Laidlaw Environmental is
entitled to a copy of Safety-Kleen's shareholder lists.
<PAGE> 16

COUNT III

(FRAUDULENT AND DECEPTIVE PRACTICES;
VIOLATION OF WIS. STAT. SEC. 552.09)

39. Laidlaw Environmental and LES repeat and reallege the allegations
in paragraphs 1 through 38, inclusive.

40. Safety-Kleen has willfully and unlawfully refused to allow Laidlaw
Environmental to examine its list of stockholders and to extract
information therefrom, pursuant to Wis. Stat. sec. 180.1602(2)(c) for the
purpose of making a takeover offer and to mail solicitation materials
published by Laidlaw Environmental to Safety- Kleen's shareholders.

41. Safety-Kleen's refusal to provide Laidlaw Environmental with the
shareholder list to which it is entitled constitutes a fraudulent,
deceptive and manipulative act in connection with a take-over offer, in
violation of Wis. Stat. sec. 552.09.

COUNT IV

(BREACH OF FIDUCIARY DUTY FOR FAILURE TO NEGOTIATE
AND FAILURE TO MAXIMIZE SHAREHOLDER VALUE)

42. Laidlaw Environmental and LES repeat and reallege the allegations
in paragraph 1 through 27, inclusive.

43. The Director Defendants agreed to sell Safety-Kleen after a sales
process that unfairly and without justification excluded Laidlaw
Environmental, the most logical bidder for the Company. They have refused
to negotiate with Laidlaw Environmental concerning its Initial Offer or its
New Offer. Instead, they have caused Safety- Kleen to enter into the
inadequate, unfair and highly contingent Buyout Transaction, which does not
maximize the value to be received by Safety-Kleen's shareholders but which
ensures the continued employment of Safety-Kleen's current management.

44. The Director Defendants' refusal to negotiate with Laidlaw
Environmental has deprived and will continue to deprive the Company's
public shareholders of the substantial premium which Laidlaw Environmental
is prepared to pay, and has deprived Laidlaw Environmental and Safety-Kleen
of the substantial cost savings and enhanced future profitability that a
merger of the two companies would produce.

45. In addition, by approving the Merger Agreement containing an
exorbitant and unlawful break-up fee, the Director Defendants have
substantially impeded the ability of Safety-Kleen's shareholders to obtain
the best value reasonably available for their shares.

46. Wisconsin law prohibits a "resident domestic corporation" from
engaging in a variety of business combinations, including mergers, with an
"interested shareholder" (which Laidlaw Environmental will be upon
completion of its exchange offer) for a three year period from the date the
shareholder became an "interested shareholder" unless the interested
shareholder receives prior approval of the company's board of directors.
Wis. Stat. sec. 180.1141. In order to create a level playing field and
obtain the best value reasonably available for its shareholders, Safety-
Kleen's Board of Directors must grant such approval to Laidlaw's
Environmental's New Offer. The Director Defendants' failure to do so is a
violation of their fiduciary duties.

47. By reason of the foregoing, the Director Defendants have violated
their fiduciary duties to obtain the best value reasonably available to
Safety-Kleen's shareholders and are not properly exercising their business
judgment. Their conduct is subject to enhanced scrutiny as a result.
<PAGE> 17

COUNT V

(DERIVATIVE CLAIM FOR CORPORATE WASTE)

48. Laidlaw Environmental and LES repeat and reallege the allegations
in paragraphs 42 through 47, inclusive.

49. Laidlaw Environmental fairly and adequately represents the
interests of the shareholders of Safety-Kleen in enforcing the rights of
the corporation with respect to this Count.

49. Laidlaw Environmental has not made a demand upon the Safety-Kleen
board to cause Safety-Kleen to bring suit against the Director Defendants
for breach of fiduciary duty and waste of corporate assets because any such
demand would be futile and therefore should be excused in this action
because, among other things:

(a) The Director Defendants' actions complained about herein have
been undertaken for the primary purpose of entrenching themselves in
office, and the Director Defendants therefore are self-interested
directors and cannot exercise the requisite independence to decide to
commence an action to redress the corporate waste and breaches of
fiduciary duty alleged herein.

(b) The Director Defendants' decision to exclude Laidlaw
Environmental from the sales process of Safety-Kleen makes clear that
the Director Defendants' actions are not the product of a valid exercise
of business judgment. The Director Defendants refused even to consider
Laidlaw Environmental's proposal unless it would agree to enter into the
Standstill Agreement that would have provided the Director Defendants
with the power to veto any offer by Laidlaw for two years. The Director
Defendants also participated in and/or approved of Safety-Kleen's
unlawful refusal of Laidlaw Environmental's request for a special
meeting of Safety-Kleen shareholders, its unlawful refusal to provide
Laidlaw Environmental with Safety-Kleen's record of shareholders, and
Safety-Kleen's commencement of a declaratory action against Laidlaw
Environmental.

(c) The nature of the Buyout Transaction approved by the Director
Defendants and the process by which they approved it make clear that the
Director Defendants' actions are not the product of a valid exercise of
business judgment. For example, the Director Defendants accepted the
inadequate offer and agreed to the one-sided Merger Agreement, including
the excessive and unreasonable break-up fee, barely two weeks after
refusing even to discuss Laidlaw Environmental's proposal. Moreover, the
Director Defendants agreed to the Buyout Transaction without even
contacting Laidlaw Environmental to inquire whether it would increase or
amend its offer. In these circumstances, any director exercising
reasonable business judgment would not conduct a sales process that
excluded Laidlaw Environmental nor agree to a one-sided Merger Agreement
that committed Safety-Kleen to pay a break-up fee of up to $75 million.

(d) The Director Defendants have knowledge of and participated in
and/or approved the wrongs alleged herein, and did so in violation of
their duties to Safety-Kleen and its shareholders, and failed to take
action to protect Safety-Kleen or to recover amounts due to Safety-Kleen
by virtue of the misconduct alleged herein.

(e) The Director Defendants have irreconcilable conflicts of
interests regarding the prosecution of this action against themselves
and cannot exercise the requisite independence to make a good faith
business judgment whether to prosecute the claims herein in the name of
Safety-Kleen.

51. This action is not a collusive one to confer jurisdiction on a
court of the United States which it would not otherwise have.

52. By agreeing to the excessive and unnecessary "break-up fee" and,
upon information and belief, excessive and unnecessary "severance pay" and
other compensation for Safety-Kleen's management, the Director Defendants
have caused the gross waste of corporate assets of Safety-Kleen.

53. The Director Defendants should be required to account to
Safety-Kleen for this waste of corporate assets and all other damages
caused by their approval of the Buyout Transaction.
<PAGE> 18

COUNT VI

(BREACH OF FIDUCIARY DUTY
FOR FAILURE TO AMEND RIGHTS PLAN)

54. Laidlaw Environmental repeats and realleges the allegations in
paragraphs 48 through 53, inclusive.

55. On November 9, 1988, the Safety-Kleen Board issued what is
commonly referred to as a "Poison Pill", by adopting a "Rights Plan" and
declaring a dividend of one common share purchase right ("Right") on each
outstanding share, payable to Safety-Kleen shareholders of record on
November 21, 1988 (the "Record Date"). Each Right entitles the holder
thereof to buy one share at an exercise price of $73.33, subject to
adjustment. Because Safety- Kleen's stock never has traded anywhere near
the $73.33 per share exercise price, it is clear that the Rights never were
intended to provide the holders thereof with a meaningful opportunity to
purchase the common stock authorized under the Poison Pill. Instead,
Safety-Kleen's Board instituted the Poison Pill solely so that its
"flip-in" and "flip-over" provisions (as described below) could be deployed
when necessary to make any offer not approved by the directors
prohibitively expensive by drastically diluting Safety-Kleen's outstanding
shares or ravaging the capital structure of the potential acquirer.

56. The "flip-in" rights are triggered when a person or entity becomes
the beneficial owner of 20% or more of Safety-Kleen's outstanding shares.
Once the Rights flip in, all Rights holders, except the potential acquirer,
may exercise each Right to purchase shares of Safety-Kleen common stock at
an immense discount -- namely for 50% of the then-market price of the
stock. Any Rights held by the potential acquirer, however, become void.
Thus, all Rights holders other than the acquirer would be entitled to
purchase Safety-Kleen's common stock for one-half of its then-market price.
In this way, the "flip-in" feature flagrantly discriminates against an
acquirer by diluting its stock holdings and increasing substantially the
number of shares the acquirer would have to purchase in order to consummate
a merger.

57. The "flip-over" rights are triggered if:

(i) Safety-Kleen is acquired in a merger or other business
combination;

(ii) more than 50% of Safety-Kleen's assets or earning power is
sold. Upon the occurrence of any of these "flip-over" events, all Rights
holders, except the acquirer, may exercise each Right to purchase shares
of common stock of the acquiring company at 50% of its market value. In
this way, the "flip-over" feature subjects the acquiring company to a
massive half-price sale of its own stock, drastically impairing its
capital structure. The obvious purpose of the Poison Pill is to render
an attempted acquisition of Safety-Kleen financially impossible without
the blessing of the directors.

58. The Director Defendants have the power to amend the terms of the
Rights to cause them not to be triggered. In addition, at any time prior to
the acquisition by a person or group of affiliated or associated persons of
beneficial ownership of 20% or more of the outstanding shares, the Director
Defendants may redeem the Rights in whole, but not in part, at a price of
$.0067 per Right, subject to adjustment (the "Redemption Price").
Immediately upon any redemption of the Rights, the right to exercise the
Rights will terminate and the only right of the holders of the Rights will
be to receive the Redemption Price.

59. The Rights will cause substantial dilution to a person or group of
persons that attempts to acquire Safety-Kleen in a manner which causes the
Rights to become exercisable.

60. On November 14, 1997, Safety-Kleen's Board of Directors adopted a
resolution delaying implementation of the Rights Plan with respect to
Laidlaw Environmental's Initial Offer, but did not exempt the Initial Offer
from the Rights Plan or redeem the Rights under the Rights Plan.

61. On November 20, 1997, the Director Defendants amended the Rights
Plan to provide that the flip-in and flip-over provisions of the Rights
would not be triggered by the Buyout Transaction. The
<PAGE> 19

Director Defendants have failed to take similar action with respect to
Laidlaw Environmental's New Offer, notwithstanding that it offers a higher
price than the Buyout Transaction.

WHEREFORE, Laidlaw Environmental and LES demand judgment against
Safety-Kleen:

1. dismissing Safety-Kleen's Complaint in its entirety with
prejudice;

2. entering an order:

(i) compelling Safety-Kleen to hold a special shareholders'
meeting to vote on the Resolution proposed by Laidlaw Environmental
in accordance with Wis. Stat sec. 1150(5)(-a);

(ii) compelling Safety-Kleen to produce promptly and at
Safety-Kleen's expense, its shareholder lists;

(iii) declaring that the Director Defendants have breached their
fiduciary duties to Safety-Kleen's shareholders, including Laidlaw
Environmental, by refusing to negotiate with Laidlaw Environmental,
entering into the Buyout Transaction, and agreeing to the unlawful
provisions of the merger agreement, including the break-up fee;

(iv) compelling the Director Defendants to carry out their
fiduciary duties to Safety-Kleen's shareholders, including Laidlaw
Environmental, by implementing and adhering to procedures under which
the transaction providing the best value reasonably available can be
obtained for Safety-Kleen's shareholders;

(v) enjoining Safety-Kleen and the Director Defendants from
proceeding with the Buyout Transaction or paying a "break-up fee" to
the Buyout Group;

(vi) requiring the Director Defendants to account to
Safety-Kleen for the waste of corporate assets and all other damages
caused by their approval of the Buyout Transaction;

(vii) directing the Director Defendants to amend the Rights Plan
to make it inapplicable to the New Offer or to redeem the Rights; and

(viii) directing the Director Defendants to negotiate with
Laidlaw Environmental regarding its exchange offer;

3. awarding Laidlaw Environmental its reasonable costs and expenses
of this action, including its attorneys' fees;

4. granting such other and further relief as this Court deems just
and proper.

Dated: November 24, 1997

LAIDLAW ENVIRONMENTAL SERVICES, INC.
and LES ACQUISITION, INC.

By:
----------------------------------------
One of Their Attorneys

James E. Hanlon, Jr.
William W. Davis
Lisa M. Noller
Katten Muchin & Zavis
525 West Monroe Street
Suite 1600
Chicago, Illinois 60661-3693
(312) 902-5200