When you get the "Out of Control" case when Otis calls you, head to the Wonderland Plaza.
Go up to where the ride is and to the controls and examine them.
A cutscene will take place and you will have to fight Adam the clown.
The easiest way to kill him is to get a few handguns and stay way from him and shoot him when he blows up a balloon by shooting the ballon itself.
I was around level 40 the first time I killed him, so I just meleed him.
Watch out for his "tornado" skil (spins with chainsaws), and also after you hit him down he will blow fire at you.
After you kill him pick up his "Small Chainsaw" then examine the ride again and there should be another chainsaw where he died.
Get the Criminal Biology, Entertainment, and Construction books and you'll have the small chainsaw times 27!
And if you manage to break both chainsaws (I had to kill around 1500+ people to break one!) go back to where you killed Adam and you can get a brand new chainsaw.