10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)
[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended June 19, 2010
	OR
[   ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934
	For the transition period from ______________ to ______________

Commission File Number 001-33987

HERITAGE-CRYSTAL CLEAN, INC.

(Exact name of registrant as specified in its charter)

Delaware	26-0351454
State or other jurisdiction of	(I.R.S. Employer
Incorporation	Identification No.)

2175 Point Boulevard

Suite 375

Elgin, IL 60123

(Address of principal executive offices)  (Zip Code)

Registrant’s telephone number, including area code (847) 836-5670

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes [   ] No [   ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.  See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	[   ]	Accelerated Filer   [   ]
Non-accelerated filer	[X]	Smaller reporting company   [   ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [   ] No [X]

Number of shares outstanding of registrant’s class of common stock as of July 16, 2010: 14,214,275

1

Table of Contents

PART I - FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS	3
ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	16
ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	23
ITEM 4.  CONTROL AND PROCEDURES	23
PART II - OTHER INFORMATION
ITEM 1A.  RISK FACTORS	24
ITEM 6.  EXHIBITS	26
SIGNATURES	27

2

PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

3

Heritage-Crystal Clean, Inc.

Consolidated Balance Sheets

(In Thousands, Except Share and Par Value Amounts)

(Unaudited)

	June 19, 2010		January 2, 2010
ASSETS
Current Assets:
Cash and cash equivalents	$	22,727	$	1,090
Accounts receivable - net		13,539		11,941
Income tax receivables		30		380
Inventory - net		11,310		9,845
Deferred income taxes		649		639
Other current assets		2,268		1,970
Total Current Assets		50,523		25,865
Property, plant and equipment - net		27,403		25,101
Software and intangible assets - net		2,821		3,021
Total Assets	$	80,747	$	53,987
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable - net	$	7,416	$	4,740
Accrued salaries, wages, and benefits		2,216		1,922
Taxes payable		885		911
Other accrued expenses		1,458		1,474
Total Current Liabilities		11,975		9,047
Deferred income taxes		914		1,015
Total Liabilities		12,889		10,062
Commitments and contingencies
STOCKHOLDERS' EQUITY:
Common stock - 18,000,000 shares authorized at $0.01 par value,
13,756,694 and 10,708,471 shares issued and outstanding at June 19, 2010 and January 2, 2010, respectively		137		107
Additional paid-in capital		65,529		43,219
Retained earnings		2,192		599
Total Stockholders' Equity		67,858		43,925
Total Liabilities and Stockholders' Equity	$	80,747	$	53,987

See accompanying notes to financial statements.

4

Heritage-Crystal Clean, Inc.

Consolidated Statements of Operations

(In Thousands, Except per Share Amounts)

(Unaudited)

	Second Quarter Ended,				First Half Ended,
	June 19, 2010		June 20, 2009		June 19, 2010		June 20, 2009
Sales	$	25,338	$	22,401	$	49,343	$	46,157
Cost of sales		6,408		5,239		12,414		12,736
Gross profit		18,930		17,162		36,929		33,421
Operating costs		12,820		12,094		25,315		24,333
Selling, general, and administrative expenses		4,435		3,979		8,799		7,831
Operating income		1,675		1,089		2,815		1,257
Interest expense – net		—		—		—		—
Loss on disposal of fixed assets – net		39		59		39		59
Income before income taxes		1,636		1,030		2,776		1,198
Provision for income taxes		705		428		1,183		496
Net income available to common stockholders	$	931	$	602	$	1,593	$	702
Net income per share available to common stockholders: basic	$	0.09	$	0.06	$	0.15	$	0.07
Net income per share available to common stockholders: diluted	$	0.08	$	0.06	$	0.15	$	0.07
Number of weighted average common shares outstanding: basic		10,909		10,695		10,811		10,692
Number of weighted average common shares outstanding: diluted		10,973		10,772		10,871		10,769

See accompanying notes to financial statements.

5

 Heritage-Crystal Clean, Inc.

Consolidated Statement of Stockholders’ Equity

(In Thousands, Except Share Amounts)

(Unaudited)

			Par
			Value		Paid–in
	Shares		Common		Capital		Retained Earnings		Total
Balance, January 2, 2010		10,708,471	$	107	$	43,219	$	599	$	43,925
Net income		—		—		—		1,593		1,593
Proceeds from issuance of   common stock – net		3,000,000		30		21,945		—		21,975
Issuance of common stock – ESPP		9,561		—		101		—		101
Converted restricted shares to   common stock		38,662		—		80		—		80
Share–based compensation		—		—		184		—		184
Balance, June 19, 2010		13,756,694	$	137	$	65,529	$	2,192	$	67,858

See accompanying notes to financial statements.

6

Heritage-Crystal Clean, Inc.

Consolidated Statements of Cash Flows

(In Thousands)

(Unaudited)

	First Half Ended,
	June 19, 2010			June 20, 2009
Cash Flows from Operating Activities:
Net income	$	1,593		$	702
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		2,084			1,806
Bad debt provision		418			387
Share-based compensation		264			182
Deferred rent		24			47
Deferred taxes		(111	)		355
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable		(2,016	)		1,193
Decrease (increase) in income tax receivables		350			480
Decrease (increase) in inventory		(1,465	)		872
Decrease (increase) in prepaid and other current assets		(298	)		(459	)
Increase (decrease) in accounts payable		1,994			(100	)
Increase (decrease) in accrued expenses		229			(121	)
Cash provided by operating activities		3,066			5,344
Cash flows from Investing Activities:
Capital expenditures		(3,465	)		(2,322	)
Software and intangible asset expenditures		(40	)		(1,225	)
Cash used in investing activities		(3,505	)		(3,547	)
Cash flows from Financing Activities:
Proceeds from issuance of common stock, net of offering costs		22,076			106
Repayments of note payable - bank		—			(20	)
Cash provided by financing activities		22,076			86
Net increase in cash and cash equivalents		21,637			1,883
Cash and cash equivalents, beginning of period		1,090			327
Cash and cash equivalents, end of period	$	22,727		$	2,210
Supplemental disclosure of cash flow information:
Cash paid for interest	$	—		$	—
Income taxes paid		954			234
Supplemental disclosure of noncash information:
Payables for construction in process		759			81

See accompanying notes to financial statements.

7

HERITAGE-CRYSTAL CLEAN, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 19, 2010

(Unaudited)

(1)    ORGANIZATION AND NATURE OF OPERATIONS

Heritage-Crystal Clean, Inc., a Delaware corporation and its subsidiary (collectively the “Company”), provides parts cleaning and hazardous and non-hazardous waste services to small and mid-sized customers in both the manufacturing and automotive service sectors.  Our service programs include parts cleaning, containerized waste management, used oil collection, and vacuum truck services.  Currently, the Company’s locations are in the United States and no international business is conducted.

On May 6, 2010, the shareholders of the Company voted and approved at the Company’s annual meeting an amendment to the Amended and Restated Certificate of Incorporation to increase the number of authorized shares of Common Stock from 15,000,000 to 18,000,000.  The amendment to the Amended and Restated Certificate of Incorporation was filed on May 13, 2010.

On June 8, 2010, the Company raised net proceeds of approximately $22.0 million in a secondary public offering.  Further details regarding this transaction can be found below under the heading “Stockholders’ Equity.”

(2)    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation and Basis of Presentation

The Company conducts its primary business operations through Heritage-Crystal Clean, LLC, its wholly owned subsidiary, and all intercompany balances have been eliminated in consolidation.

The unaudited interim financial statements included herein have been prepared by the Company in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and in accordance with Rule 10-01 of Regulation S-X of the Securities Exchange Act of 1934, as amended.  Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.  Operating results for interim periods are not necessarily indicative of results that may be expected for the year as a whole.  In the opinion of the Company’s management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included.  These financial statements and notes thereto should  b e read in conjunction with the Company’s audited financial statements for the fiscal year ended January 2, 2010 included in the Company’s Annual Report on Form 10-K for fiscal year 2009 filed with the Unites States Securities and Exchange Commission on March 5, 2010.  The balance sheet data at January 2, 2010 included in this Form 10-Q was derived from the Company’s audited financial statements, but does not include all disclosures required by GAAP.

The Company’s fiscal year ends on the Saturday closest to December 31.  The most recent fiscal year ended on January 2, 2010.  Our convention with respect to reporting periodic financial data is such that each of our first three fiscal quarters consist of twelve weeks while our last fiscal quarter consists of sixteen or seventeen weeks.  Interim results are presented for the twelve-week and twenty four-week periods ended June 19, 2010 and June 20, 2009 each referred to as “second quarter ended” or “second fiscal quarter of 2010” and “first half  of fiscal 2010” and “first half of fiscal 2009”, respectively.

The Company presents its consolidated financial statements as one reportable segment.  This determination is made based on the evaluation completed by the Company given that its business operations have similar economic characteristics and offer the same services to the same type customers.

8

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires the use of certain estimates by management in determining the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expenses during the reporting period.  Significant items subject to such estimates and assumptions are the allowance for doubtful accounts receivable and valuation of inventory at lower of cost or market.  Actual results could differ from those estimates.

Fair Value of Financial Instruments

The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement.  These tiers include: Level 1, defined as quoted market prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, model-based valuation techniques for which all significant assumptions are observable in the market, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or li abilities; and Level 3, defined as unobservable inputs that are not corroborated by market data.

The Company’s financial instruments consist primarily of cash, trade receivables and trade payables.  As of June 19, 2010 and January 2, 2010, the carrying values of cash, trade receivables and trade payables are considered to be representative of their respective fair values.

New Accounting Pronouncements  

Revenue Arrangements with Multiple Deliverables

In September 2009, the Financial Accounting Standards Board (“FASB”) updated guidance for revenue arrangements with multiple deliverables.  In absence of vendor-specific objective evidence ("VSOE") or other third party evidence ("TPE") of the selling price for the deliverables in a multiple-element arrangement, companies are required to use an estimated selling price ("ESP") for the individual deliverables.  Companies shall apply the relative-selling price model for allocating an arrangement's total consideration to its individual elements.  Under this model, the ESP is used for both the delivered and undelivered elements that do not have VSOE or TPE of the selling price.  The effective date is for fiscal years beginning on or after June 15, 2010, and will be applied prospectively to re venue arrangements entered into or materially modified after the effective date.  Since the Company will apply the requirements of this guidance on a prospective basis, the Company continues to evaluate its effect on its consolidated financial statements.

Fair Value Measurements and Disclosures

In January 2010, the FASB issued revised guidance which requires additional disclosures about items transferring into and out of Levels 1 and 2 in the fair value hierarchy.  The revised guidance also requires additional separate disclosures about purchases, sales, issuances, and settlements relative to Level 3 measurements, and clarifies, among other things, the existing fair value disclosures about the level of disaggregation.  This pronouncement is effective for interim and annual financial periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements relative to Level 3 measurements, which are effective for interim and annual financial periods beginning after December 15, 2010.  The Company adopted this guidance on January 3, 2010 and its ado ption of these amendments did not have a material impact on the disclosures of the Company’s consolidated financial statements.

9

(3)    ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following (in thousands):

	June 19, 2010		January 2, 2010
Trade	$	14,049	$	12,291
Less allowance for doubtful accounts		(763)		(601)
Trade - net		13,286		11,690
Trade - affiliates		107		128
Other		146		123
Total accounts receivable - net	$	13,539	$	11,941

The following table provides the changes in the Company’s allowance for doubtful accounts for the first half ended June 19, 2010 and the fiscal year ended January 2, 2010 (in thousands):

	June 19, 2010		January 2, 2010
Balance at beginning of period	$	601	$	616
Provision for bad debts		418		1,030
Accounts written off, net of recoveries		(256)		(1,045)
Balance at end of period	$	763	$	601

(4)    INVENTORY

The carrying value of inventory consisted of the following (in thousands):

	June 19, 2010		January 2, 2010
Machines	$	2,348	$	2,783
Solvents and oil		6,897		4,780
Drums		1,098		1,255
Accessories		1,125		1,247
Total inventory		11,468		10,065
Less reserves		(158)		(220)
Total inventory - net	$	11,310	$	9,845

Inventory consists primarily of new and used solvents and used oil, new and refurbished parts cleaning machines, drums, accessories and absorbents and repair parts.  Inventories are valued at the lower of first-in, first-out (FIFO) cost or market, net of any reserves for excess, obsolete or unsalable inventory.  The Company continually monitors its inventory levels at each of its locations and evaluates inventories for excess or slow-moving items.  If circumstances indicate the cost of inventories exceed their recoverable value, inventories are reduced to net realizable value.

10

(5) OTHER ASSETS

Other current assets consisted of the following (in thousands):

	June 19, 2010		January 2, 2010
Prepaid and other current assets	$	2,268	$	1,617
Prepaid income taxes		—		353
Total other current assets	$	2,268	$	1,970

(6) PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consisted of the following (in thousands):

	June 19, 2010		January 2, 2010
Land	$	183	$	183
Buildings and storage tanks		3,602		3,648
Leasehold improvements		584		557
In-service equipment		30,155		28,362
Machinery, vehicles and equipment		12,096		11,713
Construction in progress		2,678		701
Total property, plant and equipment		49,298		45,164
Less accumulated depreciation		(21,895)		(20,063)
Property, plant and equipment - net	$	27,403	$	25,101

(7) ACCOUNTS PAYABLE

Accounts payable consisted of the following (in thousands):

	June 19, 2010		January 2, 2010
Accounts payable	$	7,393	$	4,564
Accounts payable - affiliates		23		176
Total accounts payable	$	7,416	$	4,740

(8) OTHER ACCRUED EXPENSES

Other accrued expenses consisted of the following (in thousands):

	June 19, 2010		January 2, 2010
Workers compensation	$	534	$	536
Other		924		938
Total other accrued expenses	$	1,458	$	1,474

11

(9) NOTE PAYABLE

The Company has a bank credit facility that provides for borrowings of up to $30.0 million.  The maturity date of the credit facility is December 14, 2012.  As of June 19, 2010 and January 2, 2010, the Company did not have any amounts outstanding under the credit facility.  Under the terms of the credit facility, interest is payable monthly at the prime rate plus 25 basis points, unless the total leverage ratio is greater than or equal to 2.75 to 1. The Company did not have any amounts outstanding under its bank credit facility during the first half of fiscal 2010.  Amounts borrowed under the credit facility are secured by a security interest in substantially all of the Company’s tangible and intangible assets.  As of June 19, 2010, and January 2, 2010, the Company had $0.2 mil lion and $0.2 million of standby letters of credit issued, respectively.  As of June 19, 2010 and January 2, 2010, $29.8 million and $29.8 million were available for borrowing under the bank credit facility, respectively.

In June 2010, the Company amended the bank credit facility capital expenditure covenant to allow the Company to exclude up to $42.0 million of capital expenditures relating to the oil re-refining project from the capital expenditure limit of $10.0 million in any fiscal year providing the Company raised at least $18.5 million of net proceeds from the issuance of common stock.  The Company met this condition by raising more than the required $18.5 million from the issuance of common stock in the second quarter of 2010.

As of June 19, 2010 and January 2, 2010, the Company was in compliance with all covenants under the bank credit facility.

(10)    COMMITMENTS AND CONTINGENCIES

The Company may be subject to investigations, claims or lawsuits as a result of operating its business, including matters governed by environmental laws and regulations.  The Company believes that it carries appropriate levels of insurance given its history, and when claims are asserted, the Company evaluates the probable exposure and accrues for insurance deductibles.  Currently the Company is not aware of any such item which it expects to have a material adverse affect on its financial position.

 (11)    INCOME TAXES

The Company’s effective tax rate for the second fiscal quarter of 2010 was 43.1% compared to 41.6% in the second fiscal quarter of 2009.  The Company’s effective tax rate for the first half of 2010 was 42.6% compared to 41.4% in the first half of 2009.  The overall effective tax rate was elevated in the first half of 2010 over the first half of 2009 due to a higher expected blended state income tax rate.  The higher blended state income tax rate increased as a percentage of income due to some states basing their tax base primarily on gross receipts rather than on income.

The Company has not provided any valuation allowance as it believes the realization of its deferred tax assets is more likely than not based on the expectation of future taxable income.

(12)    SHARE-BASED COMPENSATION

The aggregate number of shares of common stock which may be issued under the Company’s 2008 Omnibus Plan (“Plan”) is 1,902,077 plus any common stock that becomes available for issuance pursuant to the reusage provision of the Plan.  As of June 19, 2010, the number of shares available for issuance under the Plan was 971,197 shares.

12

Stock Option Awards

A summary of stock option activity under this Plan is as follows:

				Weighted Average
	Number of			Remaining		Aggregate
	Options		Weighted Average	Contractual Term		Intrinsic Value
Stock Options	Outstanding		Exercise Price	(in years)		(in thousands)
Outstanding at January 2, 2010	889,654	$	10.76	8.39	$	493
Granted	—
Exercised	—
Options outstanding at June 19, 2010	889,654		10.76	7.93		121
Unvested stock options at June 19, 2010	118,219		7.33	8.77		91
Vested stock options at June 19, 2010	771,435		11.29	7.80		30
Options exercisable at June 19, 2010	771,435		11.29	7.80		30

The Company estimates the fair value of stock options granted using the Black-Scholes-Merton option-pricing model.  This fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period.

Stock options issued on March 25, 2009 have a graded vesting schedule over four years and vest 25% per year beginning on the first anniversary following the grant date.  At June 19, 2010, there was approximately $0.4 million of unrecognized compensation expense related to these awards which will be recorded through 2013.

Restricted Stock Compensation/Awards

In May 2010, the Company granted 15,492 restricted shares to its Board of Directors which vests fully after one year of service from their grant date.  The fair value of each restricted stock grant is based on the closing price of the Company's stock on the date of grant and the expense is amortized over the vesting period.  At June 19, 2010, there was less than $0.1 million of unrecognized compensation expense related to these awards which will be recorded through the second quarter of fiscal 2011.

In the first half of fiscal 2010, the Company approved future restricted stock grants as part of management’s annual compensation for fiscal 2010. These awards will be based on the Company’s financial results for fiscal 2010.  These restricted shares are expected to be granted in the first fiscal quarter of 2011.  Once granted, the restricted shares will be subject to a graded vesting schedule over a three year period.  Based on the relevant guidance, the Company has determined that the service inception date is prior to the grant date and therefore the Company has accrued compensation expense related to these awards.  If the service inception date precedes the grant date, accrual for the compensation expense for periods prior to the grant date is based on the fair value of the awa rd at each reporting date if the perfomance criteria are deemed probable.  As of June 19, 2010, the Company has evaluated and believes that the performance criteria are probable.  At June 19, 2010, there was approximately $0.8 million of unrecognized compensation expense related to these awards which will be recorded so long as the performance criteria are probable.  The final determination will only take place in the first fiscal quarter of 2011 once the performance criteria are known and finalized.  Once the restricted shares have been granted, compensation expense will continue to be recorded through the vesting period.

13

Performance Restricted Stock Awards

In February 2007, the Company granted to certain key employees in one of the Company’s operating divisions 120 common units that subsequently converted to 60,000 restricted common shares in connection with the Company’s initial public offering in March 2008.  These restricted shares were subject to forfeiture if certain performance goals were not achieved by fiscal year end 2011.  In the third quarter of fiscal 2009, 5,000 restricted common shares were canceled due to the retirement of one of the recipients of these restricted common shares.

On May 17, 2010, these awards were modified as follows:

·   The performance condition was eliminated;

·   40% of the 55,000 restricted shares or 22,000 shares became fully vested on the date of modification;

·   Portions of the remaining 33,000 restricted shares will vest using the following schedule:

o   May 17, 2011 (One-third)

o   May 17, 2012 (Two-thirds)

o   May 17, 2013 (All shares become fully vested)

In accordance with FASB guidance, these changes were considered to be modifications, the fair market value of the new awards was compared to the original awards fair market value and since the value was less, no incremental expense was recognized at the time of modification.  As of June 19, 2010, there was approximately $0.3 million of unrecognized compensation expense related to these awards which will be recorded through May 2013.

Employee Stock Purchase Plan

As of June 19, 2010, the Company had reserved 66,430 shares of common stock available for purchase under the Employee Stock Purchase Plan of 2008.  In the first half of fiscal 2010, employees purchased 9,561 shares of the Company’s common stock with a weighted average per share fair value of $10.54.

(13)    STOCKHOLDERS’ EQUITY

On June 8, 2010, the Company completed a secondary public offering.  In connection with the secondary offering, the Company:

·   Sold 3,000,000 additional shares of common stock at $8.00 per share, raising net proceeds of approximately $22.0 million after underwriting discounts and transaction costs.

·   The Company intends to use the net proceeds from the offering to fund a portion of the construction costs for the used oil re-refinery that it plans to build in Indianapolis, Indiana.

14

(14)    EARNINGS PER SHARE

Basic net income per common share is computed by dividing net income available for common shareholders by the weighted average number of common shares outstanding for the period.  Diluted net income per common share is computed by dividing the sum of net income available for common shareholders by the sum of the weighted average number of common shares outstanding and any dilutive potential common equivalents for the period.

The following table reconciles the number of common shares outstanding for the second fiscal quarters ended and first halves ended, June 19, 2010 and June 20, 2009, respectively, to the number of weighted average basic common shares outstanding and the number of weighted average diluted common shares outstanding for the purposes of calculating basic and diluted earnings per common share.  The table also provides the number of shares of common stock potentially issuable and the number of potentially issuable shares excluded from the diluted earnings per share computation for each period (in thousands, except per share data):

	Second Quarter Ended,						First Half Ended,
	June 19, 2010			June 20, 2009			June 19, 2010			June 20, 2009
Net income available to common stockholders	$	931		$	602		$	1,593		$	702
Number of common shares outstanding at quarter end		13,757			10,700			13,757			10,700
Effect of using weighted average common shares outstanding		(2,848	)		(5	)		(2,946	)		(8	)
Weighted average basic common shares outstanding		10,909			10,695			10,811			10,692
Dilutive shares for share–based compensation plans		64			77			60			77
Weighted average diluted common shares outstanding		10,973			10,772			10,871			10,769
Potentially issuable shares		939			967			939			967
Number of anti–dilutive potentially issuable shares excluded from diluted common shares outstanding		732			890			732			890
Net income per share available to common stockholders: basic	$	0.09		$	0.06		$	0.15		$	0.07
Net income per share available to common stockholders: diluted	$	0.08		$	0.06		$	0.15		$	0.07

For all periods presented above, the Company has excluded the effects of some stock options as their inclusion would have had an anti-dilutive effect on earnings per share.

(15)    SUBSEQUENT EVENTS

We have evaluated subsequent events and have identified the following transaction that warrants discussion.

On June 22, 2010, the underwriters for the Company’s public offering that occurred on June 8, 2010, exercised their right to purchase an additional 450,000 shares of the Company’s common stock pursuant to the offering agreement.  The net proceeds to the Company after deducting the underwriters’ discount from the sale of these additional shares was approximately $3.4 million.

15

ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Disclosure Regarding Forward-Looking Statements

You should read the following discussion in conjunction with our consolidated financial statements and related notes in our Annual Report on Form 10-K filed with the SEC on March 5, 2010.  In addition to historical information, this discussion contains forward-looking statements that involve risks, uncertainties and assumptions that could cause actual results to differ materially from our expectations.  These statements can be identified by the fact that they do not relate strictly to historical or current facts.  They use words such a s “aim,” “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “should,” “will be,” “will continue,” “will likely result,” “would” and other words and terms of similar meaning in conjunction with a discussion of future or estimated operating or financial performance.  You should read statements that contain these words carefully, because they discuss our future expectations, contain projections of our future results of operations or of our financial position or state other “forward-looking” information.  Forward-looking statements speak only as of the date of this quarterly report.  Factors that could cause such differences include those described in “Risk Factors” identified in this F orm 10-Q and the section titled “Risk Factors” and elsewhere in our Annual Report on Form 10-K for fiscal 2009 filed with the SEC on March 5, 2010.  Except as required under federal securities laws and the rules and regulations of the SEC, we do not have any intention, and do not undertake, to update any forward-looking statements to reflect events or circumstances arising after the date of this quarterly report, whether as a result of new information, future events or otherwise.  As a result of these risks and uncertainties, readers are cautioned not to place undue reliance on the forward-looking statements included in this quarterly report or that may be made elsewhere from time to time by, or on behalf of, us.  All forward-looking statements attributable to us are expressly qualified by these cautionary statements.  Certain tabular information may not foot due to rounding.  Our fiscal year ends on the Saturday closest to December 31.  Interim results are presented for the twelve week periods and twenty-four week periods ended June 19, 2010 and June 20, 2009, each referred to as “second quarter ended” or “second fiscal quarter” and “first half ended”, respectively.

Overview

We are a leading provider of industrial and hazardous waste services to small and mid-sized customers who are engaged in vehicle maintenance or manufacturing activities.  Our service programs include parts cleaning, containerized waste management, used oil collection, and vacuum truck services.  These services help our customers manage their used chemicals and liquid and solid wastes, while also helping to minimize their regulatory burdens.  We operate from a network of 62 branch facilities providing service to customers in 39 states.

In the first quarter of 2010, we announced our plans to develop a used oil re-refinery.  In the second fiscal quarter of 2010, we secured the required major permits and announced that we selected Indianapolis, Indiana as our site for the re-refinery, which is also the location of our largest hub.  The re-refinery is being designed to process up to 50 million gallons per year of used oil feedstock and produce up to 30 million gallons per year of lubricating base oil.  The estimated capital cost of the project is approximately $40 million and we expect that operation of the re-refinery will increase our working capital requirements by approximately $5 to $10 million.  The re-refinery is expected to begin operating at partial capacity during 2012.  During the design and construction period, we plan to roll out additional used oil collection routes to increase the volume of used oil that we collect and we estimate that during fiscal 2010 and 2011 we will incur net expenses of roughly $1.0 million and $1.5 million, respectively, related to this roll out.

On May 6, 2010, the shareholders of the Company voted and approved at the Company’s annual meeting an amendment to the Amended and Restated Certificate of Incorporation to increase the number of authorized shares of Common Stock from 15,000,000 to 18,000,000.  The amendment to the Amended and Restated Certificate of Incorporation was filed on May 13, 2010.

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On June 8, 2010, the Company raised net proceeds of approximately $22.0 million in a secondary public offering.  Further details regarding this transaction can be found in the notes to our quarterly financial statements. On June 22, 2010, the underwriters for our public offering that occurred on June 8, 2010, exercised their right to purchase an additional 450,000 shares of our common stock pursuant to the offering agreement.  The net proceeds, after deducting the underwriter’s discount, from the sale of these additional shares was approximately $3.4 million.

Critical Accounting Policies

Critical accounting policies are those that both are important to the accurate portrayal of a company’s financial condition and results, and require subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

In order to prepare financial statements that conform to accounting principles generally accepted in the United States, commonly referred to as GAAP, we make estimates and assumptions that affect the amounts reported in our financial statements and accompanying notes.  Certain estimates are particularly sensitive due to their significance to the financial statements and the possibility that future events may be significantly different from our expectations.

Management believes that there have been no significant changes during the first half of 2010 to the items that we disclosed as our critical accounting policies and estimates in the section entitled Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended January 2, 2010 filed with the United States Securities and Exchange Commission on March 5, 2010.

New Accounting Pronouncements

Revenue Arrangements with Multiple Deliverables

In September 2009, the FASB ratified guidance for revenue arrangements with multiple deliverables.  In absence of vendor-specific objective evidence ("VSOE") or other third party evidence ("TPE") of the selling price for the deliverables in a multiple-element arrangement, it requires companies to use an estimated selling price ("ESP") for the individual deliverables.  Companies shall apply the relative-selling price model for allocating an arrangement's total consideration to its individual elements.  Under this model, the ESP is used for both the delivered and undelivered elements that do not have VSOE or TPE of the selling price.  The effective date is for fiscal years beginning on or after June 15, 2010, and will be applied prospectively to revenue arrangements entered into or materially modifie d after the effective date.  Since we will apply the requirements of this guidance on a prospective basis, we are continuing to evaluate its effect on our consolidated financial statements.

Fair Value Measurements and Disclosures

In January 2010, the FASB issued revised guidance which requires additional disclosures about items transferring into and out of Levels 1 and 2 in the fair value hierarchy.  The revised guidance also requires additional separate disclosures about purchases, sales, issuances, and settlements relative to Level 3 measurements, and clarifies, among other things, the existing fair value disclosures about the level of disaggregation.  This pronouncement is effective for interim and annual financial periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements relative to Level 3 measurements, which are effective for interim and annual financial periods beginning after December 15, 2010.  We adopted this guidance as of January 3, 2010 and the adoption of these amendments did not have a material impact on the disclosures of our consolidated financial statements.

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RESULTS OF OPERATIONS

General

The following table sets forth certain operating data as a percentage of sales for the periods indicated:

	Second Quarter Ended,						First Half Ended,
	June 19, 2010			June 20, 2009			June 19, 2010			June 20, 2009
Sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales		25.3	%		23.4	%		25.2	%		27.6	%
Gross profit		74.7	%		76.6	%		74.8	%		72.4	%
Operating costs		50.6	%		54.0	%		51.3	%		52.7	%
Selling, general, and administrative expenses		17.5	%		17.8	%		17.8	%		17.0	%
Operating income		6.6	%		4.9	%		5.7	%		2.7	%
Interest expense – net		0.0	%		0.0	%		0.0	%		0.0	%
Loss on disposal of fixed assets		0.2	%		0.3	%		0.1	%		0.1	%
Income before income taxes		6.5	%		4.6	%		5.6	%		2.6	%
Provision for income taxes		2.8	%		1.9	%		2.4	%		1.1	%
Net income available to common stockholders		3.7	%		2.7	%		3.2	%		1.5	%

Second Quarter and First Half Ended June 19, 2010 (“second fiscal quarter of 2010” and “first half of 2010”) compared to Second Quarter and First Half Ended June 20, 2009 (“second fiscal quarter of 2009” and “first half of 2009”)

Sales

For the second fiscal quarter of 2010, sales increased $2.9 million, or 12.9%, to $25.3 million from $22.4 million for the second fiscal quarter of 2009.  For the first half of 2010, sales increased $3.2 million, or 6.9%, to $49.3 million from $46.2 million for the first half of 2009.  Sales increased in all service types in the second fiscal quarter and on a year-to-date basis compared to the second fiscal quarter and first half of fiscal 2009 due to higher customer demand for our services.  The increase was also positively impacted by our price increases in the fourth quarter of fiscal 2009.

At the end of the second fiscal quarter of 2010, we were operating 62 branch locations compared with 58 at the end of the second fiscal quarter of 2009.  There were 58 branches that were in operation during both the second fiscal quarter of 2010 and second fiscal quarter of 2009, which experienced an increase of $2.5 million, or 11.1% in same-branch sales.  Excluding the 3 branches in this group that gave up customers to new branch openings, the remaining 55 branches experienced an increase in sales of $2.4 million, or 11.7%.  On a year-to-date basis, same-branch sales increased $2.4 million, or 5.2% for these same 58 braches.  Excluding the 3 branches in this group that gave up customers to ne w branch openings, the remaining 55 branches experienced an increase of $2.5 million, or 5.8%.

Cost of sales

For the second fiscal quarter of 2010, cost of sales increased $1.2 million, or 22.3%, to $6.4 million from $5.2 million for the second fiscal quarter of 2009.  Cost of sales as a percentage of sales increased to 25.3% in second fiscal quarter of 2010, from 23.4%, in the second fiscal quarter of 2009.  The increase was due to the higher used oil prices and volumes in the second fiscal quarter of 2010 compared to the second fiscal quarter of 2009.  This was partially offset as the increase in our used oil inventory in the second fiscal quarter of 2010 was greater than the increase during second fiscal quarter of 2009.  For the first half of 2010, cost of sales decreased $0.3 million, or 2.5%, to $12.4 million from $12.7 million for the first half of 2009.  Cost of sales as a percentag e of sales decreased to 25.2% in the first half of 2010, from 27.6%, in the first half of 2009.  Early in fiscal 2009, cost of sales was still negatively impacted by the declining

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crude oil prices.  Higher costs in the first half of 2009 reflect the decline that we experienced in the first quarter of 2009 in the value of virgin solvent inventory held at our locations for use in our service programs which is valued at the lower of cost or market.

Operating costs

For the second fiscal quarter of 2010, operating costs increased $0.7 million, or 6.0%, to $12.8 million from $12.1 million for the second fiscal quarter of 2009.  For the first half of 2010, operating costs increased $1.0 million, or 4.0%, to $25.3 million from $24.3 million for the first half of 2009.  We undertook cost cutting measures such as workforce efficiencies early in fiscal 2009 to compensate for the sales decline we were experiencing during the recession.  These measures continue to reduce our operating expenses as a percentage of sales when comparing the first half of fiscal 2010 to fiscal 2009.  Costs for diesel and transportation fuel surcharges in the second fiscal quarter and the first half in 2010 were higher than in the second fiscal quarter and the first half of 2009.   ;Additionally, we incurred branch labor, collection truck and facility costs in connection with new branches opened in the first fiscal quarter of 2010.

Selling, general, & administrative expenses

For the second fiscal quarter of 2010, selling, general and administrative expenses increased $0.4 million, or 10.0%, to $4.4 million from $4.0 million for the second fiscal quarter of 2009.  For the first half of 2010, selling general and administrative expenses increased $1.0 million, or 12.8%, to $8.8 million from $7.8 million for the first half of 2009.  Selling, general and administrative expenses as a percentage of sales increased to 17.8% in the first half of 2010, from 17.0%, in the first half of 2009.  The increase was primarily due to a charge related to a sales tax audit recorded in the first fiscal quarter of 2010 and the increase in the Management Incentive Plan (“MIP”) bonus pool which is aligned with the profitability of operations.

Interest expense — net

There was zero interest expense in both the second quarters and first halves of fiscal 2010 and 2009, respectively, due to no debt outstanding during these periods.

Provision for income taxes

Our effective tax rate in the second fiscal quarter of 2010 was 43.1%, compared to 41.6% in the second fiscal quarter of 2009.  On a year-to-date basis, our effective tax rate was 42.6% in the first half of fiscal 2010 compared to 41.4% in the first half of fiscal 2009.  The overall effective tax rate was elevated in the first half of 2010 over the first half of 2009 due to a higher expected blended state income tax rate.  The higher blended state income tax rate increased as a percentage of income due to some states basing their tax base primarily on gross receipts rather than on income.

FINANCIAL CONDITION

Liquidity and Capital Resources

Cash and Cash Equivalents

As of June 19, 2010 and January 2, 2010, cash and cash equivalents were $22.7 million and $1.1 million, respectively.  Our primary sources of liquidity are cash flows from operations and funds available to borrow under our bank credit facility. In June 2010, we raised net proceeds of approximately $22.0 million in a secondary public offering. We intend to use these proceeds to fund a portion of the construction costs for the used oil re-refinery which we plan to build in Indianapolis, Indiana.

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Our secured bank credit facility provides for borrowings of up to $30.0 million.  Under the terms of our credit facility, borrowings will bear interest at the prime rate plus 25 basis points, unless the total leverage ratio is greater than or equal to 2.75 to 1.  The weighted average effective interest rate for amounts outstanding was 3.25% at January 2, 2010.  We did not have any amounts outstanding under our bank credit facility during the first half of 2010. As of June 19, 2010, and January 2, 2010, we were in compliance with all covenants under the credit facility.  As of June 19, 2010, and January 2, 2010, we did not have any borrowings outstanding under the bank credit facility.  However, we did have $0.2 million and $0.2 million of standby letters of credit issued, respectively.
60; Therefore as of June 19, 2010 and January 2, 2010, $29.8 million and $29.8 million were available for borrowing under the bank credit facility, respectively.

In June 2010, we amended the bank credit facility capital expenditure covenant to allow us to exclude up to $42.0 million in capital expenditures relating to the oil re-refining project from the capital expenditure limit of $10.0 million in any fiscal year providing we raised at least $18.5 million of net proceeds from the issuance of common stock.  We met this condition by raising more than the required $18.5 million from the issuance of common stock in the second quarter of 2010.

We believe that our existing cash, cash equivalents, available borrowings and other sources of financings will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next 12 months.  We cannot assure you that this will be the case or that our assumptions regarding sales and expenses underlying this belief will be accurate, especially given the current economic conditions.  If in the future, we require more liquidity than is available to us under our credit facility, we may need to raise additional funds through debt or equity offerings.  Adequate funds may not be available when needed or may not be available on terms favorable to us, especially given the current tightening of the financial credit markets.  If additional funds are raised by issuing equity securities, dilution to existing stockholders may result.  If we raise additional funds by obtaining loans from third parties, the terms of those financing arrangements may include negative covenants or other restrictions on our business that could impair our operational flexibility, and would also require us to fund additional interest expense.  If funding is insufficient at any time in the future, we may be unable to develop or enhance our products or services, take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition and results of operations.

In the first quarter of 2010, we announced that we were planning to develop a used oil re-refinery.  In the second fiscal quarter of 2010, we secured the required major permits and announced that we selected Indianapolis, Indiana as our site for the re-refinery, which is also the location of our largest hub.  The re-refinery is being designed to process up to 50 million gallons per year of used oil feedstock and produce up to 30 million gallons per year of lubricating base oil.  The estimated capital cost of the project is approximately $40.0 million and we expect that the operation of the re-refinery will increase our working capital requirements by $5 to $10 million.  The re-refinery is expected to begin operating at partial capacity during 2012.  As of June 19, 2010, $2.5 million has b een capitalized relating to the used oil re-refinery.  An additional $3.7 million has been committed for orders for significant equipment related to the used oil re-refinery as of the end of the second fiscal quarter of 2010.  During fiscal 2010 and 2011, we plan to roll out additional used oil collection routes to increase the volume of used oil that we collect and we estimate that we will incur roughly $1.0 million and $1.5 million of net expense, respectively,  related to the roll out.  We intend to use the money we raised in our recent equity offering to fund a portion of the construction costs for the used oil re-refinery.

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Summary of Cash Flow Activity

	First Half Ended,
	(Dollars in thousands)
	June 19, 2010			June 20, 2009
Net cash provided by (used in):
Operating activities	$	3,066		$	5,348
Investing activities		(3,505	)		(3,547	)
Financing activities		22,076			86
Net increase in cash and cash equivalents	$	21,637		$	1,887

Net Cash Provided by Operating Activities — The most significant items affecting the comparison of our operating activities for the periods presented are summarized below:

•  Earnings improvements — Our net income in the first half of 2010 positively impacted our net cash provided by operating activities by $0.9 million compared to the first half of 2009.

•  Accounts Receivable — The increase of accounts receivable negatively affected cash flows from operations by $3.2 million in the first half of 2010 compared to first half of 2009.  During the first half of 2010 we experienced an improvement in sales compared to the first half of 2009.  However, most of the improvement was experienced in the second quarter.  This acceleration of sales led to a higher accounts receivable balance at the end of the first half of 2010.  In the first half of 2009 we saw a reduction of our accounts receivable due to declining sales.

•  Inventory — The increase in inventory negatively affected cash flows from operations by $2.3 million in first half of 2010 compared to the first half of 2009.  The change mostly reflects the increasing value of our inventories due to the increase of crude oil prices along with the increase of our used oil inventories associated with the ramp up of used oil collection efforts associated with the used oil re-refining project.  The increase also includes $0.4 million of solvent that was shipped and was in-transit to our hubs at the close of our first half of 2010.  Although we show a negative impact in cash flow from operations from the rise of crude oil prices, our gross margins and profits for the first half of 2010 were positively impacted.  This in part contrasts with the first half of 2009 when we were experiencing declining inventory values from the decline in crude oil prices which resulted in a negative impact on our margins and profits.

•  Accounts Payable — The increase in accounts payable positively affected our cash flows from operations by $2.1 million in the first half of 2010 compared to the first half of 2009.  The increase in accounts payable in the first half of 2010 is partially due to the increase in the cost of sales items associated with the increased sales year over year.  Additionally, accounts payable increased in the first half of 2010 because of the inception of the oil re-refinery project; at the end of the first half of 2010 we had $0.8 million of accounts payable related to the project.  Also, in the final weeks of the first half of 2010 we purchased $0.4 million of solvent which had not been delivered to our hubs prior to the end of our quarter.

 Net Cash Used in Investing Activities — The most significant items affecting the comparison of our investing activities for the periods presented are summarized below:

•  Capital expenditures — We used $3.5 million for capital expenditures during both the first half of 2010 and the first half of 2009.  During the first half of 2010, approximately $1.8 million of the capital expenditures were for purchases of parts cleaning machines compared to $1.7 million in the first half of 2009.  Additionally, in the first half of 2010, we spent $1.1 million dollars on the used oil re-refining project.  The remaining $0.6 million in the first half of 2010 was for other items including office equipment, leasehold improvements, software and intangible assets compared to $1.8 million in the first half of 2009.

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Net Cash Provided by Financing Activities — The most significant items affecting the comparison of our financing activities for the periods presented are summarized below:

•  Proceeds from the issuance of common stock, net of offering costs — During the first half of 2010, we received approximately $22.0 million in net proceeds in conjunction with a secondary public offering.

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ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to interest rate risks primarily through borrowings under our bank credit facility.  Interest on these borrowings is based upon variable interest rates.  As we had no debt outstanding for the first half of 2010 we currently do not have exposure to rate changes.  We currently do not hedge against interest rate risk.

ITEM 4.  CONTROLS AND PROCEDURES

The Company's Chief Executive Officer and Chief Financial Officer have concluded, based on their evaluation as of the end of the period covered by this report, that the Company's disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) are effective to ensure that information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding financial disclosures.

There was no change in the Company's internal control over financial reporting that occurred during the second fiscal quarter of 2010 that has materially affected or is reasonably likely to materially affect, the Company's internal control over financial reporting.

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PART II - OTHER INFORMATION

ITEM 1A.  RISK FACTORS

The following sets forth certain risk factors that you should carefully consider before making an investment in our Company. These risks are in addition to the risks identified in the section titled "Risk Factors" and elsewhere in our Annual Report on Form 10-K for fiscal 2009 filed with the SEC on March 5, 2010. You should consider carefully all of these risk factors together with all of the information included or referred to in the reports that we file with the SEC before investing in our securities.

We may not be able to build and operate a used oil re-refinery as planned and it may cost more than anticipated which could harm our business.

We have recently announced plans to build a used oil re-refinery.  The development of the re-refinery is in its early stages and we may be unable to construct the re-refinery on the current timetable or as currently contemplated.  There can be no assurance that we will develop a commercially successful re-refinery or that unforeseen market conditions will not adversely impact the construction, operation or profitability of the re-refinery.  The development of a used oil re-refinery is a new business line for our Company and requires a different employee base and skill set than that required for our current business, including chemical engineering, design and operational management of the re-refinery.  Although our management team has operated re-refineries for other companies, we cannot assure you that we will have sufficient expertise to develop a re-refinery within the budget contemplated or that it will operate within the performance parameters currently contemplated for the re-refinery.  Further, the development of the re-refinery will require time and resources, including the attention of our management, which could divert our management from other activities and may impair the operation of our existing business.

The development of the re-refinery could take longer than expected, cost more than expected or not perform as anticipated.  For example, the use of subcontractors or the costs of materials such as steel to construct the facility may be more expensive than we anticipate leading to project cost overruns.  In addition, the construction and operation of a re-refinery is highly regulated.  We have not yet obtained all of the required permits to build the re-refinery and the permit process is ongoing.  We may be subject to delays or even cancellation of the project if we are unable to obtain permits on terms acceptable to us.

We expect that the development and construction of the re-refinery will cost approximately $40 million and estimate that the operation of the re-refinery will increase our working capital requirements by $5 to $10 million.  In addition, during our development of the re-refinery, we expect to expand our used oil collection services and expect to incur roughly $1.0 million and $1.5 million of net expense in fiscal 2010 and 2011, respectively, with respect to such efforts.  If we are not able to borrow sufficient funds or obtain other sources of financing to complete the re-refinery, we may not be able to complete the re-refinery which could have a material adverse effect on our business.  We intend to use the net proceeds from our recent equity offering to fund a portion of the costs of the re-refinery, and ex pect to obtain the remaining funds needed from our borrowings under our credit agreement.  Even if we secure adequate financing, our investments in this project may limit our ability to pursue other opportunities in the future.

Even if we are able to build a used oil re-refinery, the used oil re-refinery may not generate the operating results that we anticipate and may lead to greater volatility in our sales and earnings.

We may not be able to realize the expected benefits from developing and operating a used oil re-refinery.  If we complete the construction of the re-refinery, the subsequent operation of the plant creates different and additional risks compared to our historic service businesses.  We may experience difficulty securing sufficient used oil feedstock to run the re-refinery at anticipated rates and have to pay more for the feedstock, or reduce our operating rates.  We may also have difficulty selling all of the lubricating base oil that we produce.  Our costs for used oil feedstock and the prices that we can sell the lubricating base oil and byproducts made by the re-refinery are determined by competitive market factors including the world price of crude oil, prices for natural gas, and the lube oil pr ices posted by major refiners, none of which we control.  Our estimates of sales and profitability for the re-refinery could prove to be erroneous or could be impacted by changes in these market factors.  In particular, if crude oil prices come down, we expect that we would experience a reduction in our margins from used oil re-refining as

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well as potential inventory charges related to material held for processing or sale.  Even if crude oil prices decrease, the costs required to collect and process the used oil may not decrease.  If crude oil prices rise, we expect that the feedstock prices for our re-finery would also increase.  If the prices we charge for our re-refined oil and the costs to collect and re-refine used oil do not move together or in similar magnitudes, our profitability may be materially and negatively impacted.  Any volatility in the price of crude oil could also cause volatility in our operating results.

Our operation of a re-refinery exposes us to risks related to the potential adverse environmental impact of a spill or other release at the re-refinery, the loss of permits, the risk of explosion or fire or other hazards, the risk of injury to our employees or others, as well as the negative publicity due to public concerns regarding our operation.  While these risks are in some respects similar to risks that we have experienced in our traditional service businesses, the magnitude of exposure may be greater due to the nature of the re-refining business and the greater volumes, temperatures and pressures involved.  While we may maintain some insurance that covers portions of these exposures, in many cases the risks are uninsurable or we will not choose to procure insurance at levels that will cover any potential exposu re.

Any problem or perception of a problem with our re-refining project could have a material adverse impact on our sales and earnings and lead to a loss of stockholder and/or research analyst confidence in our business and could result in a sudden and significant reduction in our stock price.

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ITEM 6.  EXHIBITS

3.1	Certificate of Incorporation of Heritage-Crystal Clean, Inc., as amended on May 13, 2010.
10.1	First Amendment dated as of May 14, 2010 to the Third Amended and Restated Credit Agreement dated as of December 14, 2009 by and between Heritage-Crystal  Clean, LLC and Bank of America, N.A. (Incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed with the SEC on May 18,  2010)
10.2	Second Amendment dated as of June 1, 2010 to the Third Amended and Restated Credit Agreement dated as of December 14, 2009 by and between Heritage-Crystal Clean, LLC and Bank of America, N.A.
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

HERITAGE-CRYSTAL CLEAN, INC.

Date: July 30, 2010	By:	/s/ Gregory Ray
		Gregory Ray
		Chief Financial Officer, Vice President, Business Management and Secretary

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EX-3

Exhibit 3.1

STATE OF DELAWARE

CERTIFICATE OF AMENDMENT

OF THE AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF

HERITAGE-CRYSTAL CLEAN, INC.

The corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware does hereby certify:

FIRST:  That at a meeting of the Board of Directors of HERITAGE-CRYSTAL CLEAN, INC. resolutions were duly adopted setting forth a proposed amendment of the Amended and Restated Certificate of Incorporation of said corporation, declaring said amendment to be advisable and calling a meeting of the stockholders of said corporation for consideration thereof.  The resolution setting forth the proposed amendment is as follows:

WHEREAS, the Amended and Restated Certificate of Incorporation (“Certificate of Incorporation”) of the Corporation currently provides for 15,000,000 authorized shares of common stock, $0.01 par value per share (“Common Stock”) and the Board deems it desirable and in the best interests of the Corporation to amend the Certificate of Incorporation to increase the authorized Common Stock by 3,000,000 shares to 18,000,000 shares.

NOW, BE IT THEREFORE RESOLVED that the first paragraph of Article FOURTH of the Certificate of Incorporation be amended in its entirety to read as follows:

“FOURTH: The total number of shares of all classes of stock which the Corporation shall have the authority to issue is Eighteen Million Five Hundred Thousand (18,500,000) shares of capital stock, consisting of (i) Eighteen Million (18,000,000) shares of common stock, $0.01 par value per share (the “Common Stock”) and (ii) Five Hundred Thousand (500,000) shares of preferred stock, $0.01 par value per share (the “Preferred Stock”).”

SECOND:  That thereafter, pursuant to resolution of its Board of Directors, an annual meeting of the stockholders of said corporation was duly called and held upon notice in accordance with Section 222 of the General Corporation Law of the State of Delaware at which meeting the necessary number of shares as required by statute were voted in favor of the amendment.

THIRD:  That said amendment was duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware.

IN WITNESS WHEREOF, said corporation has caused this certificate to be signed this 13th day of May, 2010.

By:	/s/ Brent Amato
	Authorized Signatory
Name:  Brent L. Amato Title: Vice President, General Counsel

AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF

HERITAGE-CRYSTAL CLEAN, INC.

The original Certificate of Incorporation of Heritage-Crystal Clean, Inc. was filed with the Secretary of State of Delaware on June 13, 2007, under the name of Heritage-Crystal Clean, Inc. This Amended and Restated Certificate of Incorporation (this “Amended and Restated Certificate of Incorporation”), which amends and restates the Certificate of Incorporation as set forth below, was duly adopted in accordance with the provisions of Sections 242 and 245 of the General Corporation Law of the State of Delaware.

FIRST: The name of the Corporation is Heritage-Crystal Clean, Inc.

SECOND: The registered office of the Corporation in the State of Delaware shall be located at Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, County of New Castle. The name of its registered agent shall be The Corporation Trust Company.

THIRD: The purposes of the Corporation are to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware.

FOURTH: The total number of shares of all classes of stock which the Corporation shall have authority to issue is Fifteen Million Five Hundred Thousand (15,500,000) shares of capital stock, consisting of (i) Fifteen Million (15,000,000) shares of common stock, $0.01 par value per share (“Common Stock”), and (ii) Five Hundred Thousand (500,000) shares of preferred stock, $0.01 par value per share (the “Preferred Stock”).

The following is a statement of the designations and the powers, privileges and rights, and the qualifications, limitations or restrictions thereof in respect of each class of capital stock of the Corporation. Unless otherwise indicated, references to “Sections” or “Subsections” in this Article Fourth refer to sections and subsections of this Article Fourth.

(A)   Common Stock

(1)   Voting Rights. The holders of shares of Common Stock shall be entitled to one vote for each share so held with respect to all matters voted on by the stockholders of the Corporation, subject in all cases to the voting rights, if any, of any holders of Undesignated Preferred Stock.

(2)   Liquidation Rights. Subject to the prior and superior right, if any, of any classes or series of the Undesignated Preferred Stock, upon any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation, the holders of Common Stock shall be entitled to receive that portion of the remaining funds to be distributed. Such funds shall be paid to the holders of Common Stock on the basis of the number of shares of Common Stock held by each of them.

(3)   Dividends. Subject to the rights, if any, of any holders of Undesignated Preferred Stock, dividends may be paid on the Common Stock as and when declared by the Board of Directors out of funds legally available therefor.

(4)   Residual Rights. All rights accruing to the outstanding shares of the Corporation not expressly provided for to the contrary herein (or in any amendment hereto) shall be vested in the Common Stock.

(5)   No Preemptive Rights. Other than pursuant to the Participation Rights Agreement by and between the Corporation and The Heritage Group dated on or around March 12, 2008, as the same may be amended, supplemented or otherwise modified from time to time, no holder of Common Stock shall have any preemptive rights with respect to the Common Stock or any other securities of the Corporation, or to any obligations convertible (directly or indirectly) into securities of the Corporation whether now or hereafter authorized.

(B)   Preferred Stock.

Subject to any limitation prescribed by law or this Amended and Restated Certificate of Incorporation, the Board of Directors of the Corporation is expressly authorized to provide for the issuance of the shares of Preferred Stock in one or more classes or one or more series of stock within any class, and by filing a certificate pursuant to applicable law of the State of Delaware, to establish or change from time to time the number of shares to be included in each such class or series, and to fix the designation, voting powers, preferences, qualifications, privileges and rights of the shares of each such class or series and any qualifications, limitations and restrictions thereof. The Board of Directors shall have the right to determine or fix one or more of the following with respect to each class or series of such Preferred Stock:

(i)The distinctive class or serial designation and the number of shares constituting such class or series;

(ii)The dividend rates or the amount of dividends to be paid on the shares of such class or series, whether dividends shall be cumulative and, if so, from which date or dates, the payment date or dates for dividends, whether payable in preference to, or in such relation to, the dividend payable on any other class or series, and the participating and other rights, if any, with respect to dividends;

(iii)The voting rights, full or limited, if any, or no voting rights, of the shares of such class or series, including special voting rights with respect to the election of directors, certain corporate actions, or other matters adversely affecting any such class or series;

(iv)Whether the shares of such class or series shall be redeemable and, if so, the price or prices at which, and the terms and conditions on which, such shares may be redeemed;

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(v)The amount or amounts payable upon the shares of such class or series and any preferences applicable thereto in the event of voluntary liquidation, dissolution, winding up or other distribution of the assets of the Corporation;

(vi)Whether the shares of such class or series shall be entitled to the benefit of a sinking or retirement fund to be applied to the purchase or redemption of such shares, and if so entitled, the amount of such fund and the manner of its application, including the price or prices at which such shares may be redeemed or purchased through the application of such fund;

(vii)Whether the shares of such class or series shall be convertible into, or exchangeable for, shares of any other class or classes or of any other series of the same or any other class or classes of stock of the Corporation and, if so convertible or exchangeable, the conversion price or prices, or the rate or rates of exchange, and the adjustments thereof, if any, at which such conversion or exchange may be made, and any other terms and conditions of such conversion or exchange;

(viii)The price or other consideration for which the shares of such class or series shall be issued;

(ix)Whether the shares of such class or series shall be entitled to the benefit of such limitations, if any, on the issuance of additional shares of such series or shares of any other class or series of Preferred Stock;

(x)Whether the shares of such class or series which are redeemed, converted or exchanged shall have the status of authorized but unissued shares of preferred stock and whether such shares may be reissued as shares of the same or any other class or series of stock; and

(xi)Such other powers, preferences, rights, qualifications, limitations and restrictions thereof, all as the Board of Directors of the Corporation may deem advisable and as are not inconsistent with the law and the provisions of this Amended and Restated Certificate of Incorporation.

Subject to the authority of the Board of Directors as set forth in Subsection (B)(x), any shares of Preferred Stock shall, upon reacquisition thereof by the Corporation, be restored to the status of authorized but unissued Preferred Stock under this Section (B).

FIFTH: Elections of directors need not be by written ballot unless the Bylaws of the Corporation shall so provide. The Board of Directors shall be divided into three classes, each class to have, as near as may be possible, an equal number of directors. The term of office of directors of the first class shall expire at the annual meeting of stockholders next ensuing this classification; the term of office of directors of the second class shall expire at the second annual meeting of stockholders next ensuing this classification; and the term of office of directors of the third class shall expire at the third annual meeting of stockholders next ensuing this classification. At each annual meeting of stockholders, directors of the class whose term then expires shall be elected for a full term of three years to succeed the directors of such cl ass, so that the term of office of the directors of one class shall expire in each year; provided, however, that nothing herein shall be construed to prevent (i) the election of a director to succeed himself or

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herself, (ii) the election of a director for the remainder of an unexpired term in the class of directors to which he or she is elected, or (iii) amendment of the Bylaws to increase or decrease the number of directors.

SIXTH: No person who is or was a director of the Corporation shall be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director except for, and only to the extent of, liability (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived any improper personal benefit. No amendment to or repeal of, or adoption of any provision of this Amended and Restated Certificate of Incorporation inconsistent with, this Section shall adversely affect the rights and protection afforded to a director of the Corporatio n under this Section for acts or omissions occurring prior to such amendment to or repeal or adoption of an inconsistent provision. If the General Corporation Law of the State of Delaware hereafter is amended to authorize the further elimination or limitation of the liability of directors, then the liability of a director of the Corporation, in addition to the limitation on personal liability provided herein, shall be limited to the fullest extent permitted by the amended General Corporation Law of the State of Delaware.

SEVENTH: The Corporation, to the full extent permitted by section 145 of the General Corporation Law of the State of Delaware, as amended from time to time, shall indemnify all persons whom it may indemnify pursuant thereto.

EIGHTH: Whenever a compromise or arrangement is proposed between this Corporation and its creditors or any class of them and/or between this Corporation and its stockholders or any class of them, any court of equitable jurisdiction within the State of Delaware may, on the application in a summary way of this Corporation or of any creditor or stockholder thereof or on the application of any receiver or receivers appointed for this Corporation under the provisions of section 291 of Title 8 of the Delaware Code or on the application of trustees in dissolution or of any receiver or receivers appointed for this Corporation under the provisions of section 279 of Title 8 of the Delaware Code, order a meeting of the creditors or class of creditors, and/or of the stockholders or class of stockholders, of this Corporation, as the case may be, to b e summoned in such manner as the said court directs. If a majority in number representing three-fourths in value of the creditors or class or creditors, and/or of the stockholders or class of stockholders, of this Corporation, as the case may be, agree to any compromise or arrangement and to any reorganization of this Corporation as a consequence of such compromise or arrangement, the said compromise or arrangement and the said reorganization shall, if sanctioned by the court to which the said application has been made, be binding on all the creditors or class of creditors, and/or on all the stockholders or class of stockholders, of this Corporation, as the case may be, and also on this Corporation.

NINTH: The books of the Corporation may be kept (subject to any provision contained in the statutes) outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the Bylaws of the Corporation.

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TENTH: In exercising the powers granted to it by law, this Amended and Restated Certificate of Incorporation, and the Bylaws, the members of the Board of Directors may consider, and act upon their beliefs concerning, the Corporation’s long-term financial and other interests, and may take into account, among other factors, the social, economic and legal effects of the Corporation’s actions upon all constituencies having a relationship with the Corporation, including without limitation, its stockholders, employees, customers, suppliers, consumers and the community at large, so long as all actions and decisions reflecting such considerations are reasonably calculated to be in the interests of the stockholders of the Corporation.

ELEVENTH: No action required to be taken or which may be taken at any annual or special meeting of the stockholders of the Corporation may be taken without a meeting, and the power of the stockholders to consent in writing, without a meeting, to the taking of any action is specifically denied.

TWELFTH: In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Board of Directors is authorized to adopt, amend or repeal the Bylaws of the Corporation, except as expressly provided therein or in the subsequent sentence. In addition to any affirmative vote of the holders of any particular class or series of stock of the Corporation as required by this Amended and Restated Certificate of Incorporation, the Bylaws or any laws, (and notwithstanding any other provisions of this Amended and Restated Certificate of Incorporation, the Bylaws or any laws which might otherwise permit a lesser vote), the Corporation shall not enter into, nor agree to, any of the following without first receiving the affirmative vote of holders of at least seventy-five (75%) of the issued and outstanding Common Stock of the Corporation:

(i)the merger or consolidation of the Corporation or any of its subsidiaries with any other corporation or entity;

(ii)the sale, conveyance, license or other disposition of all or substantially all of the assets of the Corporation or any of its subsidiaries;

(iii)the conversion of the Corporation into another type of corporation or entity; or

(iv)the alteration, repeal or amendment of any provision of this Amended and Restated Certificate of Incorporation or Article II, Section 2 (Special Meetings), Article II, Section 6 (Vote Required), Article II, Section 9 (Stockholder Nominations and Proposals), Article III, Section 1(b) (Directors), Article III, Section 3(b) (Removal of Directors), Article III, Section 12 (Vacancies and Newly-Created Directorships) and Article VII, Section 6 (Amendment) of the Bylaws.

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IN WITNESS WHEREOF, Heritage-Crystal Clean, Inc. has caused this Amended and Restated Certificate of Incorporation to be executed this 13th day of March, 2008.

HERITAGE-CRYSTAL CLEAN, INC.

By: /s/ Joseph Chalhoub

Name: Joseph Chalhoub

Title:  President and Chief Executive Officer

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EX-10

Exhibit 10.2

SECOND AMENDMENT TO THIRD AMENDED AND RESTATED

CREDIT AGREEMENT

This SECOND AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT (this “Second Amendment”) is made and entered into as of the 1st day of June, 2010, between HERITAGE-CRYSTAL CLEAN, LLC, an Indiana limited liability company (“Borrower”), and BANK OF AMERICA, N.A., a national banking association (“Lender”).

WHEREAS, the Borrower and the Lender are parties to that certain Third Amended and Restated Credit Agreement, dated as of December 14, 2009 (as amended from time to time, the “Credit Agreement”), pursuant to which the Lender has extended credit to the Borrower on the terms set forth therein;

WHEREAS, the Borrower has requested that the Lender, and the Lender has agreed to, on the terms and subject to the conditions set forth herein, amend Section 6.12(c) of the Credit Agreement as set forth below;

NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1.Definitions.  Capitalized terms used herein without definition shall have the meanings assigned to such terms in the Credit Agreement.  This Second Amendment shall constitute a Loan Document for all purposes of the Loan Agreement and the other Loan Documents.

2.Amendment to Section 6.12(c) (Capital Expenditures) of theCredit Agreement.  Section 6.12(c) of the Credit Agreement is hereby amended by deleting the reference to “$20,000,000” contained therein and replacing it with the following: “$18,500,000.”

3.Conditions to Effectiveness.  This Second Amendment shall become effective upon the receipt by the Lender of a counterpart signature page to this Second Amendment duly executed and delivered by the Borrower, the Parent and the Lender.

4.Representations and Warranties.  The Borrower represents and warrants to the Lender as follows:

(a)The execution, delivery and performance of this Second Amendment and the transactions contemplated hereby (i) are within the authority of each of the Loan Parties, (ii) have been duly authorized by all necessary corporate proceedings by each of the corporate Loan Parties, and by all necessary proceedings by the managers or members (as required) by each of the limited liability company Loan Parties, (iii) do not conflict with or result in any material breach or contravention of any provision of law, statute, rule or regulation to which any of the Loan Parties is subject or any judgment, order, writ, injunction, license or permit applicable to any of the Loan Parties so as to materially adversely affect the assets, business or any activity of the Loan Parties, and (iv) do not conflict with any provision of the corporate charter, articles or

bylaws of the corporate Loan Parties, the articles of organization or operating agreements of the limited liability company Loan Parties, or any agreement or other instrument binding upon any of the Loan Parties.

(b)The execution, delivery and performance of this Second Amendment and the other Loan Documents will result in valid and legally binding obligations of the Loan Parties enforceable against them in accordance with the respective terms and provisions hereof and thereof, except as enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting generally the enforcement of creditors’ rights and except to the extent that availability of the remedy of specific performance or injunctive relief or other equitable remedy is subject to the discretion of the court before which any proceeding therefor may be brought.

(c)The execution, delivery and performance by the Loan Parties of this Second Amendment, and the transactions contemplated hereby and thereby, do not require any approval or consent of, or filing with, any third party or governmental agency or authority.

(d)The representations and warranties contained in Article V of the Credit Agreement are true and correct in all material respects as of the date hereof, both before and after giving effect to this Second Amendment, as though made on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct as of such earlier date.  For purposes of this Paragraph 4(d), the representations and warranties contained in Section 5.05(a) of the Credit Agreement shall be deemed to refer to the most recent statements furnished pursuant to Section 6.01(a) of the Credit Ag reement.

(e)Both before and after giving effect to this Second Amendment, no Default or Event of Default under (and as defined in) the Credit Agreement has occurred and is continuing.

5.No Waiver.  Nothing contained herein shall be deemed to (i) constitute a waiver of any Default or Event of Default that may heretofore or hereafter occur or have occurred and be continuing or, except as expressly provided herein, to otherwise modify any provision of the Credit Agreement or other Loan Document, or (ii) give rise to any defenses or counterclaims to the Lender’s right to compel payment of the Obligations when due or to otherwise enforce its rights and remedies under the Credit Agreement and the other Loan Documents.

6.Ratification, etc.  Except as expressly amended hereby, the Credit Agreement, the other Loan Documents, all documents, instruments and agreements related thereto and the Obligations are hereby ratified and confirmed in all respects and shall continue in full force and effect.  This Second Amendment and the Credit Agreement shall hereafter be read and construed together as a single document, and all references in the Credit Agreement, any other Loan Document or any agreement or instrument related to the Credit Agreement shall hereafter refer to the Credit Agreement as amended by this Second Amendment.

7.GOVERNING LAW.  THIS SECOND AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE

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STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

8.Counterparts; Etc.  This Second Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which counterparts taken together shall be deemed to constitute one and the same instrument.  Any counterpart signed by all parties may be introduced into evidence in any action or proceeding without having to produce or account for the other counterparts.  Likewise, the existence of this Second Amendment may be established by the introduction into evidence of counterparts that are separately signed, provided they are otherwis e identical in all material respects.  This Second Amendment, to the extent signed and delivered by means of a facsimile machine or other electronic transmission in which the actual signature is evident, shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person.  At the request of any party hereto, each other party hereto or thereto shall re-execute original forms hereof and deliver them to all other parties.  No party hereto shall raise the use of a facsimile machine or other electronic transmission in which the actual signature is evident to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of a facsimile machine or other electronic transmission in which the actual signature is evident as a defense to the formation of a contract and each party fore ver waives such defense.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, each of the undersigned has duly executed this Second Amendment to Third Amended and Restated Credit Agreement as of the date first set forth above.

HERITAGE-CRYSTAL CLEAN, LLC, an Indiana limited liability company
By:	/s/ Greg Ray
Name: Greg Ray Title: Chief Financial Officer, Vice President, Business Management and Secretary
BANK OF AMERICA, N.A.
By:	/s/ Maria F. Maia
	Name:  Maria F. Maia
	Title:  Managing Director

By its signature below, the Parent hereby acknowledges and agrees to the terms of this Second Amendment, including, without limitation, the representations, warranties, affirmative covenants and negative covenants made or reaffirmed by the Parent herein.

HERITAGE-CRYSTAL CLEAN, INC., a Delaware corporation
By:	/s/ Greg Ray
Name: Greg Ray Title: Chief Financial Officer, Vice President, Business Management and Secretary

Signature Page to Second Amendment

EX-31

EXHIBIT 31.1

CERTIFICATION OF PRESIDENT AND CEO — PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO RULES 13a-14(A) AND 15d-14(A)

OF THE SECURITIES EXCHANGE ACT OF 1934

I, Joseph Chalhoub, certify that:

1. I have reviewed this Form 10-Q for the quarter ended June 19, 2010 of Heritage-Crystal Clean, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 30, 2010	By: /s/ Joseph Chalhoub
	Joseph Chalhoub
	President, CEO and Director — Principal Executive Officer

EX-31

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO RULES 13a-14(A) AND 15d-14(A)

OF THE SECURITIES EXCHANGE ACT OF 1934

I, Gregory Ray, certify that:

1. I have reviewed this Form 10-Q for the quarter ended June 19, 2010 of Heritage-Crystal Clean, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 30, 2010	By: /s/ Gregory Ray
	Gregory Ray
	Chief Financial Officer, Vice President, Business Management and Secretary

EX-32

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Report of HERITAGE-CRYSTAL CLEAN, INC. (the “Company”) on Form 10-Q for the quarter ended June 19, 2010, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Joseph Chalhoub, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 30, 2010	By: /s/ Joseph Chalhoub
	Joseph Chalhoub
	President, CEO and Director — Principal Executive Officer

EX-32

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Report of HERITAGE-CRYSTAL CLEAN, INC. (the “Company”) on Form 10-Q for the quarter ended June 19, 2010, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gregory Ray, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 30, 2010	By: /s/ Gregory Ray
	Gregory Ray
	Chief Financial Officer, Vice President, Business Management and Secretary