10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2015

or

o TRANSITION REPORT PURSUANT TO Section 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to           .

Commission file number: 0000-11688

US ECOLOGY, INC.

(Exact name of registrant as specified in its charter)

Delaware	95-3889638
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
251 E. Front St., Suite 400
Boise, Idaho	83702
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (208) 331-8400

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  o

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  x  No  o

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

Large accelerated filer  x	Accelerated filer  o	Non-accelerated filer  o	Smaller reporting company  o
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes  o  No  x

At October 30, 2015, there were 21,735,305 shares of the registrant’s Common Stock outstanding.

US ECOLOGY, INC.

FORM 10-Q

TABLE OF CONTENTS

Item		Page
	PART I — FINANCIAL INFORMATION	3
1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014	3
	Consolidated Statements of Operations for the three and nine months ended September 30, 2015 and 2014	4
	Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2015 and 2014	5
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2015 and 2014	6
	Notes to Consolidated Financial Statements	7
	Report of Independent Registered Public Accounting Firm	23
2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
3.	Quantitative and Qualitative Disclosures About Market Risk	37
4.	Controls and Procedures	38
	PART II — OTHER INFORMATION	39
	Cautionary Statement	39
1.	Legal Proceedings	40
1A.	Risk Factors	40
2.	Unregistered Sales of Equity Securities and Use of Proceeds	40
3.	Defaults Upon Senior Securities	40
4.	Mine Safety Disclosures	40
5.	Other Information	40
6.	Exhibits	41
	SIGNATURE	42

2

PART I - FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

US ECOLOGY, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except par value amount)

	September 30, 2015			December 31, 2014 As Adjusted
Assets
Current Assets:
Cash and cash equivalents	$	9,350		$	22,971
Receivables, net	104,283			135,261
Prepaid expenses and other current assets	10,241			11,984
Income taxes receivable	332			6,912
Deferred income taxes	2,599			2,109
Assets held for sale	78,775			—
Total current assets	205,580			179,237
Property and equipment, net	204,387			227,684
Restricted cash and investments	5,773			5,729
Intangible assets, net	243,187			278,667
Goodwill	194,825			217,609
Other assets	9,624			11,308
Deferred income taxes	—			85
Total assets	$	863,376		$	920,319
Liabilities And Stockholders’ Equity
Current Liabilities:
Accounts payable	$	16,745		$	24,513
Deferred revenue	7,212			13,190
Accrued liabilities	28,119			36,251
Accrued salaries and benefits	10,624			13,322
Income taxes payable	1,730			4,124
Current portion of closure and post-closure obligations	4,402			5,359
Current portion of long-term debt	3,505			3,828
Liabilities associated with assets held for sale	20,240			—
Total current liabilities	92,577			100,587
Long-term closure and post-closure obligations	67,061			67,511
Long-term debt	356,410			390,825
Other long-term liabilities	7,351			4,336
Deferred income taxes	87,771			105,723
Total liabilities	611,170			668,982
Commitments and contingencies
Stockholders’ Equity:
Common stock $0.01 par value, 50,000 authorized; 21,735 and 21,632 shares issued, respectively	217			216
Additional paid-in capital	168,978			165,524
Retained earnings	99,509			93,301
Treasury stock, at cost, 1 shares	(60		)	(18		)
Accumulated other comprehensive loss	(16,438		)	(7,686		)
Total stockholders’ equity	252,206			251,337
Total liabilities and stockholders’ equity	$	863,376		$	920,319

The accompanying notes are an integral part of these financial statements.

3

US ECOLOGY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share amounts)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Revenue	$	148,414		$	170,864		$	424,797		$	290,237
Direct operating costs	102,474			118,556			297,543			190,664
Gross profit	45,940			52,308			127,254			99,573
Selling, general and administrative expenses	23,507			25,508			71,075			46,271
Impairment charges	—			—			6,700			—
Operating income	22,433			26,800			49,479			53,302
Other income (expense):
Interest income	17			11			64			94
Interest expense	(5,081		)	(4,543		)	(16,208		)	(5,488		)
Foreign currency loss	(994		)	(830		)	(1,769		)	(1,027		)
Other	387			301			1,156			557
Total other expense	(5,671		)	(5,061		)	(16,757		)	(5,864		)
Income before income taxes	16,762			21,739			32,722			47,438
Income tax expense	6,858			8,406			14,815			17,880
Net income	$	9,904		$	13,333		$	17,907		$	29,558
Earnings per share:
Basic	$	0.46		$	0.62		$	0.83		$	1.37
Diluted	$	0.46		$	0.61		$	0.82		$	1.37
Shares used in earnings per share calculation:
Basic	21,655			21,570			21,619			21,526
Diluted	21,749			21,680			21,723			21,649
Dividends paid per share	$	0.18		$	0.18		$	0.54		$	0.54

The accompanying notes are an integral part of these financial statements.

4

US ECOLOGY, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Net income	$	9,904		$	13,333		$	17,907		$	29,558
Other comprehensive income (loss):
Foreign currency translation loss	(3,590		)	(2,156		)	(6,761		)	(2,078		)
Net changes in interest rate hedge, net of taxes of ($981), $0, ($1,072) and $0, respectively	(1,821		)	—			(1,991		)	—
Comprehensive income, net of tax	$	4,493		$	11,177		$	9,155		$	27,480

The accompanying notes are an integral part of these financial statements.

5

US ECOLOGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

	Nine Months Ended September 30,
	2015			2014
Cash flows from operating activities:
Net income	$	17,907		$	29,558
Adjustments to reconcile net income to net cash provided by operating activities:
Impairment charges	6,700			—
Depreciation and amortization of property and equipment	21,726			16,730
Amortization of intangible assets	9,558			5,233
Accretion of closure and post-closure obligations	3,208			1,675
Unrealized foreign currency loss	2,740			1,453
Deferred income taxes	(4,015		)	2,407
Share-based compensation expense	1,736			869
Unrecognized tax benefits	—			(424		)
Net loss on disposal of property and equipment	935			86
Amortization of debt discount	111			37
Changes in assets and liabilities (net of effect of business acquisition):
Receivables	7,221			(20,938		)
Income taxes receivable	6,560			(17		)
Other assets	1,785			(3,219		)
Accounts payable and accrued liabilities	(5,256		)	2,449
Deferred revenue	(5,371		)	391
Accrued salaries and benefits	(1,877		)	(1,949		)
Income taxes payable	(2,317		)	(2,281		)
Closure and post-closure obligations	(4,386		)	(879		)
Net cash provided by operating activities	56,965			31,181
Cash flows from investing activities:
Purchases of property and equipment	(25,693		)	(17,910		)
Purchases of restricted cash and investments	(848		)	(40		)
Proceeds from sale of restricted cash and investments	804			662
Proceeds from sale of property and equipment	404			120
Business acquisition (net of cash acquired)	—			(465,895		)
Net cash used in investing activities	(25,333		)	(483,063		)
Cash flows from financing activities:
Payments on long-term debt	(34,848		)	(1,038		)
Dividends paid	(11,700		)	(11,640		)
Proceeds from revolving credity facility	9,379			—
Payments on revolving credit facility	(9,379		)	—
Proceeds from exercise of stock options	1,664			1,445
Proceeds from issuance of long-term debt	—			413,962
Deferred financing costs paid	—			(14,001		)
Other	7			204
Net cash (used in) provided by financing activities	(44,877		)	388,932
Effect of foreign exchange rate changes on cash	(376		)	(69		)
Decrease in cash and cash equivalents	(13,621		)	(63,019		)
Cash and cash equivalents at beginning of period	22,971			73,940
Cash and cash equivalents at end of period	$	9,350		$	10,921
Supplemental Disclosures
Income taxes paid, net of receipts	$	18,723		$	17,494
Interest paid	$	14,406		$	4,145
Non-cash investing and financing activities:
Closure and post-closure retirement asset	$	—		$	2,863
Capital expenditures in accounts payable	$	3,420		$	2,378
Restricted stock issued from treasury shares	$	292		$	546

The accompanying notes are an integral part of these financial statements.

6

US ECOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1.GENERAL

Basis of Presentation

The accompanying unaudited consolidated financial statements include the results of operations, financial position and cash flows of US Ecology, Inc. and its wholly-owned subsidiaries. All significant intercompany balances have been eliminated. Throughout these financial statements words such as “we,” “us,” “our,” “US Ecology” and the “Company” refer to US Ecology, Inc. and its subsidiaries.

In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments necessary to present fairly, in all material respects, the results of the Company for the periods presented. These consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014. The results for the three and nine months ended September 30, 2015 are not necessarily indicative of results to be expected for the entire fiscal year. In these consolidated financial statements, certain amounts in prior periods’ consolidated financial statements have been reclassified to conform with the current period presentation.

The Company’s Consolidated Balance Sheet as of December 31, 2014 has been derived from the Company’s audited Consolidated Balance Sheet as of that date and has been revised for purchase price measurement period adjustments related to the acquisition of EQ as disclosed in Note 2. Additionally, on August 4, 2015, we entered into a definitive agreement to sell our Allstate Power Vac, Inc. (“Allstate”) subsidiary to a private investor group. We completed the sale of Allstate on November 1, 2015. All September 30, 2015 carrying amounts of assets and liabilities of Allstate have been classified as held for sale in our Consolidated Balance Sheets as disclosed in Note 3.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements. As it relates to estimates and assumptions in amortization rates and environmental obligations, significant engineering, operations and accounting judgments are required. We review these estimates and assumptions no less than annually. In many circumstances, the ultimate outcome of these estimates and assumptions will not be known for decades into the future. Actual results could differ materially from these estimates and assumptions due to changes in applicable regulations, changes in future operational plans and inherent imprecision associated with estimating environmental impacts far into the future.

Held for Sale

We report a business as held for sale when management has approved or received approval to sell the business and is committed to a formal plan, the business is available for immediate sale, the business is being actively marketed, the sale is probable and anticipated to occur during the ensuing year and certain other specified criteria are met. A business classified as held for sale is recorded at the lower of its carrying amount or estimated fair value less cost to sell. If the carrying amount of the business exceeds its estimated fair value, a loss is recognized. Depreciation and amortization expense are not recorded on long-lived assets of a business classified as held for sale. Assets and liabilities related to a business classified as held for sale are segregated in the September 30, 2015 unaudited Consolidated Balance Sheets and major classes are separately disclosed in the notes to the unaudited consolidated financial statements commencing in the period in which the business is classified as held for sale.

Recently Issued Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-03 Simplifying the Presentation of Debt Issuance Costs. This ASU requires an entity to present debt issuance costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. The guidance is effective for annual and interim reporting periods beginning after December 15, 2015. We do not believe the adoption of this update will have a material effect on our financial position and results of operations.

7

In May 2014, the FASB issued ASU No. 2014-09 Revenue from Contracts with Customers, which provides guidance for revenue recognition. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The standard permits the use of either the retrospective or cumulative effect transition method. The ASU also requires enhanced disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows from contracts with customers. On July 9, 2015, the FASB decided to delay the effective date of ASU 2014-09 by one year. The new guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted but not before annual periods beginning after December 15, 2016. We are currently assessing the impact the adoption of ASU 2014-09 may have on our consolidated financial statements.

NOTE 2.BUSINESS COMBINATION

On June 17, 2014, the Company acquired 100% of the outstanding shares of EQ Holdings, Inc. and its wholly-owned subsidiaries (collectively “EQ”). EQ is a fully integrated environmental services company providing waste treatment and disposal, wastewater treatment, remediation, recycling, industrial cleaning and maintenance, transportation, total waste management, technical services, and emergency response services to a variety of industries and customers in North America. The total purchase price was $460.9 million, net of cash acquired, and was funded through a combination of cash on hand and borrowings under a new $415.0 million term loan.

As of June 30, 2015, the Company finalized the purchase accounting for the acquisition of EQ. The following table summarizes the consideration paid for EQ and the fair value estimates of assets acquired and liabilities assumed recognized at the acquisition date, with purchase price allocation adjustments since the preliminary purchase price allocation as previously disclosed as of December 31, 2014:

	Purchase Price Allocation
$s in thousands	As Reported in Form 10-K			Adjustments			As Retrospectively Adjusted
Current assets	$	111,982		$	27		$	112,009
Property and equipment	101,543			—			101,543
Identifiable intangible assets	252,874			—			252,874
Current liabilities	(57,585		)	(727		)	(58,312		)
Other liabilities	(139,331		)	263			(139,068		)
Total identifiable net assets	269,483			(437		)	269,046
Goodwill	197,163			437			197,600
Total purchase price	$	466,646		$	—		$	466,646

Purchase price allocation adjustments related primarily to the receipt of additional information regarding the fair values of income taxes payable and receivable, deferred income taxes and residual goodwill.

Goodwill of $197.6 million arising from the acquisition is the result of several factors. EQ has an assembled workforce that serves the U.S. industrial market utilizing state-of-the-art technology to treat a wide range of industrial and hazardous waste. The acquisition of EQ increases our geographic base providing a coast-to-coast presence and an expanded service platform to better serve key North American hazardous waste markets. In addition, the acquisition of EQ provides us with an opportunity to compete for additional waste clean-up project work; expand penetration with national accounts; improve and enhance transportation, logistics, and service offerings with existing customers and attract new customers. $132.4 million of the goodwill recognized was allocated to reporting units in our Environmental Services segment and $65.2 million of the goodwill recognized was allocated to reporting units in our Field & Industrial Services segment. None of the goodwill recognized is expected to be deductible for income tax purposes.

8

The fair value estimate of identifiable intangible assets by major intangible asset class and related weighted average amortization period are as follows:

$s in thousands	Fair Value		Weighted Average Amortization Period (Years)
Customer relationships	$	98,400	15
Permits and licenses	89,600		45
Permits and licenses, nonamortizing	49,000		—
Tradename	5,481		3
Customer backlog	4,600		10
Developed software	3,443		9
Non-compete agreements	900		1
Internet domain and website	869		19
Database	581		15
Total identifiable intangible assets	$	252,874

The following unaudited pro forma financial information presents the combined results of operations as if EQ had been combined with us at the beginning of each of the periods presented. The pro forma financial information includes the accounting effects of the business combination, including the amortization of intangible assets, depreciation of property, plant and equipment, and interest expense. The unaudited pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the periods presented, nor should it be taken as indication of our future consolidated results of operations.

	(unaudited)		(unaudited)
	Three Months Ended		Nine Months Ended
$s in thousands, except per share amounts	September 30, 2014		September 30, 2014
Pro forma combined:
Revenue	$	170,894	$	458,091
Net income	$	13,333	$	24,835
Earnings per share
Basic	$	0.62	$	1.15
Diluted	$	0.61	$	1.15

Revenue from EQ included in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2015 was $95.0 million and $268.8 million, respectively. Operating income from EQ included in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2015 was $11.8 million and $16.1 million, respectively. Acquisition-related costs of $150,000 and $1.1 million, respectively, were included in Selling, general and administrative expenses in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2015.

NOTE 3.DISPOSITION

On August 4, 2015, we entered into a definitive agreement to sell Allstate to a private investor group for approximately $58.0 million cash, subject to adjustments for working capital and capital expenditures. Allstate represents the majority of the industrial services business and is included in our Field and Industrial Services segment, which we acquired with the acquisition of EQ. As a result of this agreement and management’s strategic review, we evaluated the recoverability of the assets associated with our industrial services business. Based on this analysis, we recorded a non-cash goodwill impairment charge of $6.7 million, or $0.31 per diluted share, in the second quarter of 2015. On November 1, 2015, we completed the sale of Allstate. The sale of Allstate does not meet the requirements to be reported as a discontinued operation as defined in ASU 2014-08. For additional information on the sale of Allstate, see Note 17.

9

Income before income taxes from Allstate included in the Company’s consolidated statements of operations for the three months ended September 30, 2015 and 2014 was $1.7 million and $265,000, respectively. For the nine months ended September 30, 2015 and 2014, loss before income taxes from Allstate was $5.7 million and income before income taxes from Allstate was $301,000, respectively. Loss before income taxes for the nine months ended September 30, 2015, includes a non-cash goodwill impairment charge of $6.4 million.

The carrying amounts of major classes of assets and liabilities of Allstate classified as held for sale in our consolidated balance sheet are as follows:

	September 30,
$s in thousands	2015
Receivables, net	$	22,340
Prepaid expenses and other current assets	1,555
Property and equipment, net	19,484
Intangible assets, net	21,824
Goodwill	13,572
Total assets held for sale	$	78,775
Accounts payable	6,108
Accrued liabilities	1,616
Accrued salaries and benefits	568
Deferred income taxes	11,948
Total liabilities held for sale	$	20,240

NOTE 4. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in accumulated other comprehensive income (loss) (“AOCI”) consisted of the following:

	Foreign Currency Translation			Unrealized Loss on Interest Rate Hedge			Total
Balance at December 31, 2014	$	(5,648	)	$	(2,038	)	$	(7,686	)
Other comprehensive loss before reclassifications, net of tax	(6,761		)	(3,706		)	(10,467		)
Amounts reclassified out of AOCI, net of tax (1)	—			1,715			1,715
Other comprehensive loss	(6,761		)	(1,991		)	(8,752		)
Balance at September 30, 2015	$	(12,409	)	$	(4,029	)	$	(16,438	)

(1)Before-tax reclassifications of $871,000 ($566,000 after-tax) and $2.6 million ($1.7 million after-tax) for the three and nine months ended September 30, 2015, respectively, were included in Interest expense in the Company’s consolidated statements of operations. Amount relates to interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying debt are made. Amounts in AOCI expected to be recognized in interest expense over the next 12 months total approximately $3.5 million ($2.3 million after tax).

10

NOTE 5.CONCENTRATIONS AND CREDIT RISK

Major Customers

No customer accounted for more than 10% of total revenue for the three or nine months ended September 30, 2015. Revenue from a single customer accounted for approximately 12% and 10% of total revenue for the three and nine months ended September 30, 2014, respectively. No customer accounted for more than 10% of total trade receivables as of September 30, 2015 or December 31, 2014.

Credit Risk Concentration

We maintain most of our cash and cash equivalents with nationally recognized financial institutions like Wells Fargo Bank, National Association (“Wells Fargo”) and Comerica, Inc. Substantially all balances are uninsured and are not used as collateral for other obligations. Concentrations of credit risk on accounts receivable are believed to be limited due to the number, diversification and character of the obligors and our credit evaluation process.

NOTE 6.RECEIVABLES

Receivables consisted of the following:

	September 30,			December 31,
$s in thousands	2015			2014
Trade	$	77,593		$	116,218
Unbilled revenue	27,703			17,857
Other	2,059			1,890
Total receivables	107,355			135,965
Allowance for doubtful accounts	(3,072		)	(704		)
Receivables, net	$	104,283		$	135,261

NOTE 7.FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are categorized using defined hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair value measurements, as follows:

Level 1 - Quoted prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable;

Level 3 - Unobservable inputs in which little or no market activity exists, requiring an entity to develop its own assumptions that market participants would use to value the asset or liability.

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, restricted cash and investments, accounts payable, accrued liabilities, debt and interest rate swap agreements. The estimated fair value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to the short-term nature of these instruments.

The Company estimates the fair value of its variable-rate debt using Level 2 inputs, such as interest rates, related terms and maturities of similar obligations. The fair value of the Company’s debt approximated its carrying amount as of September 30, 2015.

11

The Company’s assets and liabilities measured at fair value on a recurring basis consisted of the following:

	September 30, 2015
	Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	401	$	3,614	$	—	$	4,015
Money market funds (2)	1,758		—		—		1,758
Total	$	2,159	$	3,614	$	—	$	5,773
Liabilities:
Interest rate swap agreement (3)	$	—	$	6,199	$	—	$	6,199
Total	$	—	$	6,199	$	—	$	6,199

	December 31, 2014
	Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	400	$	3,590	$	—	$	3,990
Money market funds (2)	1,739		—		—		1,739
Total	$	2,139	$	3,590	$	—	$	5,729
Liabilities:
Interest rate swap agreement (3)	$	—	$	3,136	$	—	$	3,136
Total	$	—	$	3,136	$	—	$	3,136

(1)We invest a portion of our Restricted cash and investments in fixed-income securities, including U.S. Treasury and U.S. agency securities. We measure the fair value of U.S. Treasury securities using quoted prices for identical assets in active markets. We measure the fair value of U.S. agency securities using observable market activity for similar assets. The fair value of our fixed-income securities approximates our cost basis in the investments.

(2)We invest a portion of our Restricted cash and investments in money market funds. We measure the fair value of these money market fund investments using quoted prices for identical assets in active markets.

(3)In order to manage interest rate exposure, we entered into an interest rate swap agreement in October 2014 that effectively converts a portion of our variable-rate debt to a fixed interest rate. The swap is designated as a cash flow hedge, with gains and losses deferred in other comprehensive income to be recognized as an adjustment to interest expense in the same period that the hedged interest payments affect earnings. The interest rate swap has an effective date of December 31, 2014 with an initial notional amount of $250.0 million. The fair value of the interest rate swap agreement represents the difference in the present value of cash flows calculated (i) at the contracted interest rates and (ii) at current market interest rates at the end of the period. We calculate the fair value of interest rate swap agreements quarterly based on the quoted market price for the same or similar financial instruments. The fair value of the interest rate swap agreement is included in Other long-term liabilities in the Company’s consolidated balance sheet.

12

NOTE 8.PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

	September 30,			December 31,
$s in thousands	2015			2014
Cell development costs	$	120,032		$	120,878
Land and improvements	31,811			33,002
Buildings and improvements	69,883			74,518
Railcars	17,375			17,375
Vehicles and other equipment	86,527			98,877
Construction in progress	18,879			10,831
Total property and equipment	344,507			355,481
Accumulated depreciation and amortization	(140,120		)	(127,797		)
Property and equipment, net	$	204,387		$	227,684

Depreciation and amortization expense for the three months ended September 30, 2015 and 2014 was $6.6 million and $8.3 million, respectively. Depreciation and amortization expense for the nine months ended September 30, 2015 and 2014 was $21.7 million and $16.7 million, respectively.

NOTE 9.GOODWILL AND INTANGIBLE ASSETS

Changes in goodwill for the nine months ended September 30, 2015 consisted of the following:

$s in thousands	Environmental Services			Field & Industrial Services			Total
Balance at December 31, 2014 (1)	$	152,396		$	65,213		$	217,609
Impairment charges (2)	—			(6,700		)	(6,700		)
Classified as held for sale (3)	—			(13,572		)	(13,572		)
Foreign currency translation	(2,512		)	—			(2,512		)
Balance at September 30, 2015	$	149,884		$	44,941		$	194,825

(1)Balances have been revised to reflect purchase accounting measurement period adjustments related to the acquisition of EQ as disclosed in Note 2.

(2)As disclosed in Notes 3, on August 4, 2015, we entered into a definitive agreement to sell Allstate to a private investor group for approximately $58.0 million cash, subject to adjustments for working capital and capital expenditures. Allstate represents the majority of the industrial services business we acquired with the acquisition of EQ. As a result of this agreement and management’s strategic review, we evaluated the recoverability of the assets associated with our industrial services business. Based on this analysis, we recorded a non-cash goodwill impairment charge of $6.7 million, or $0.31 per diluted share, in the second quarter of 2015. We calculated the estimated fair value of the industrial services business using a combination of quoted market prices and discounted cash flows.

(3)Amounts relate to sale of Allstate as disclosed in Note 3.

13

Intangible assets, net consisted of the following:

	September 30, 2015							December 31, 2014
$s in thousands	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Amortizing intangible assets:
Permits, licenses and lease	$	110,357	$	(6,085	)	$	104,272	$	113,693	$	(4,427	)	$	109,266
Customer relationships	82,124		(7,728		)	74,396		103,086		(4,488		)	98,598
Technology - formulae and processes	6,790		(1,037		)	5,753		7,844		(1,009		)	6,835
Customer backlog	3,652		(469		)	3,183		4,600		(246		)	4,354
Tradename	4,318		(1,850		)	2,468		5,481		(979		)	4,502
Developed software	2,908		(605		)	2,303		3,745		(428		)	3,317
Non-compete agreements	732		(610		)	122		920		(462		)	458
Internet domain and website	540		(36		)	504		869		(24		)	845
Database	388		(79		)	309		667		(72		)	595
Total amortizing intangible assets	211,809		(18,499		)	193,310		240,905		(12,135		)	228,770
Nonamortizing intangible assets:
Permits and licenses	49,750		—			49,750		49,750		—			49,750
Tradename	127		—			127		147		—			147
Total intangible assets, net	$	261,686	$	(18,499	)	$	243,187	$	290,802	$	(12,135	)	$	278,667

Amortization expense for the three months ended September 30, 2015 and 2014 was $3.0 million and $4.0 million, respectively. Amortization expense for the nine months ended September 30, 2015 and 2014 was $9.6 million and $5.2 million, respectively. Foreign intangible asset carrying amounts are affected by foreign currency translation.

NOTE 10.DEBT

Long-term debt consisted of the following:

	September 30,			December 31,
$s in thousands	2015			2014
Term loan	$	360,767		$	395,616
Net discount on term loan	(852		)	(963		)
Total debt	359,915			394,653
Current portion of long-term debt	(3,505		)	(3,828		)
Long-term debt	$	356,410		$	390,825

On June 17, 2014, in connection with the acquisition of EQ, the Company entered into a new $540.0 million senior secured credit agreement (the “Credit Agreement”) with a syndicate of banks comprised of a $415.0 million term loan (the “Term Loan”) with a maturity date of June 17, 2021 and a $125.0 million revolving line of credit (the “Revolving Credit Facility”) with a maturity date of June 17, 2019. Upon entering into the Credit Agreement, the Company terminated its existing credit agreement with Wells Fargo, dated October, 29, 2010, as amended (the “Former Agreement”). Immediately prior to the termination of the Former Agreement, there were no outstanding borrowings under the Former Agreement. No early termination penalties were incurred as a result of the termination of the Former Agreement.

Term Loan

The Term Loan provides an initial commitment amount of $415.0 million, the proceeds of which were used to acquire 100% of the outstanding shares of EQ and pay related transaction fees and expenses. The Term Loan bears interest at a base rate (as defined in the Credit Agreement) plus 2.00% or LIBOR plus 3.00%, at the Company’s option. The Term Loan is subject to amortization in equal quarterly installments in an aggregate annual amount equal to 1.00% of the original principal amount of the Term Loan. At September 30, 2015, the effective interest rate on the Term Loan, including the impact of our interest rate swap, was 4.67%. Interest only payments

14

are due either monthly or on the last day of any interest period, as applicable. As set forth in the Credit Agreement, the Company is required to enter into one or more interest rate hedge agreements in amounts sufficient to fix the interest rate on at least 50% of the principal amount of the $415.0 million Term Loan. In October 2014, the Company entered into an interest rate swap agreement with Wells Fargo, effectively fixing the interest rate on $240.0 million, or 67%, of the Term Loan principal outstanding as of September 30, 2015.

Revolving Credit Facility

The Revolving Credit Facility provides up to $125.0 million of revolving credit loans or letters of credit with the use of proceeds restricted solely for working capital and other general corporate purposes. Under the Revolving Credit Facility, revolving loans are available based on a base rate (as defined in the Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”). The Company is required to pay a commitment fee of 0.50% per annum on the unused portion of the Revolving Credit Facility, with such commitment fee to be reduced based upon the Company’s total leverage ratio as defined in the Credit Agreement. The maximum letter of credit capacity under the new revolving credit facility is $50.0 million and the Credit Agreement provides for a letter of credit fee equal to the applicable margin for LIBOR loans under the Revolving Credit Facility. Interest only payments are due either monthly or on the last day of any interest period, as applicable. At September 30, 2015, there were no borrowings outstanding on the Revolving Credit Facility. The availability under the Revolving Credit Facility was $118.2 million with $6.8 million of the Revolving Credit Facility issued in the form of standby letters of credit utilized as collateral for closure and post-closure financial assurance and other assurance obligations.

Except as set forth below, the Company may prepay the Term Loan or permanently reduce the Revolving Credit Facility commitment under the Credit Agreement at any time without premium or penalty (other than customary “breakage” costs with respect to the early termination of LIBOR loans). On or prior to six months after the closing of the Credit Agreement, if we prepay the initial term loans or amend the pricing terms of the initial term loans, in each case in connection with a reduction of the effective yield, we are required to pay a 1% prepayment premium (unless in connection with a change of control, sale or permitted acquisition). Subject to certain exceptions, the Credit Agreement provides for mandatory prepayment upon certain asset dispositions, casualty events and issuances of indebtedness. The Credit Agreement is also subject to mandatory annual prepayments commencing in December 2015 if our total leverage (defined as the ratio of our consolidated funded debt as of the last day of the applicable fiscal year to our adjusted EBITDA for such period) exceeds certain ratios as follows: 50% of our adjusted excess cash flow (as defined in the Credit Agreement and which takes into account certain adjustments) if our total leverage ratio is greater than 2.50 to 1.00, with step-downs to 0% if our total leverage ratio is equal to or less than 2.50 to 1.00.

Pursuant to (i) an unconditional guarantee agreement (the “Guarantee”) and (ii) a collateral agreement (the “Collateral Agreement”), each entered into by the Company and its domestic subsidiaries on June 17, 2014, the Company’s obligations under the Credit Agreement are jointly and severally and fully and unconditionally guaranteed on a senior basis by all of the Company’s existing and certain future domestic subsidiaries and the Credit Agreement is secured by substantially all of the Company’s and its domestic subsidiaries’ assets except the Company’s and its domestic subsidiaries’ real property.

The Credit Agreement contains customary restrictive covenants, subject to certain permitted amounts and exceptions, including covenants limiting the ability of the Company to incur additional indebtedness, pay dividends and make other restricted payments, repurchase shares of our outstanding stock and create certain liens. We may only declare quarterly or annual dividends if on the date of declaration, no event of default has occurred and no other event or condition has occurred that would constitute default due to the payment of the dividend.

The Credit Agreement also contains a financial maintenance covenant, which is a maximum Consolidated Senior Secured Leverage Ratio, as defined in the Credit Agreement, and is only applicable to the Revolving Credit Facility. Our Consolidated Senior Secured Leverage Ratio as of the last day of any fiscal quarter, commencing with June 30, 2014, may not exceed the ratios indicated below:

Fiscal Quarters Ending	Maximum Ratio
June 30, 2014 through September 30, 2015	4.00 to 1.00
December 31, 2015 through September 30, 2016	3.75 to 1.00
December 31, 2016 through September 30, 2017	3.50 to 1.00
December 31, 2017 through September 30, 2018	3.25 to 1.00
December 31, 2018 and thereafter	3.00 to 1.00

At September 30, 2015, we were in compliance with all of the financial covenants in the Credit Agreement.

15

NOTE 11.CLOSURE AND POST-CLOSURE OBLIGATIONS

Our accrued closure and post-closure obligations represent the expected future costs, including corrective actions, associated with closure and post-closure of our operating and non-operating disposal facilities. Liabilities are recorded when work is probable and the costs can be reasonably estimated. We perform periodic reviews of both non-operating and operating facilities and revise accruals for estimated closure and post-closure, remediation or other costs as necessary. Recorded liabilities are based on our best estimates of current costs and are updated periodically to include the effects of existing technology, presently enacted laws and regulations, inflation and other economic factors.

Changes to closure and post-closure obligations consisted of the following:

	Three Months Ended			Nine Months Ended
$s in thousands	September 30, 2015			September 30, 2015
Closure and post-closure obligations, beginning of period	$	72,690		$	72,870
Accretion expense	1,132			3,208
Payments	(2,250		)	(4,386		)
Currency translation	(109		)	(229		)
Closure and post-closure obligations, end of period	71,463			71,463
Less current portion	(4,402		)	(4,402		)
Long-term portion	$	67,061		$	67,061

NOTE 12.INCOME TAXES

Our effective tax rate for the three months ended September 30, 2015 was 40.9%, up from 38.7% for the three months ended September 30, 2014. Our effective tax rate for the nine months ended September 30, 2015 was 45.3%, up from 37.7% for the nine months ended September 30, 2014. The increase for the three months ended September 30, 2015 primarily reflects a lower proportion of earnings from our Canadian operations, which are taxed at a lower corporate rate, partially offset by lower non-tax deductible business development expenses. The increase for the nine months ended September 30, 2015 primarily reflects non-deductible impairment charges of $6.7 million, and a lower proportion of earnings from our Canadian operations, which are taxed at a lower corporate rate, partially offset by lower non-tax deductible business development expenses.

We file a consolidated U.S. federal income tax return with the Internal Revenue Service as well as income tax returns in various states and Canada. We may be subject to examination by taxing authorities in the U.S. and Canada for tax years 2011 through 2014. Additionally, we may be subject to examinations by various state and local taxing jurisdictions for tax years 2010 through 2014.

16

NOTE 13.EARNINGS PER SHARE

	Three Months Ended September 30,
$s and shares in thousands, except per share	2015				2014
amounts	Basic		Diluted		Basic		Diluted
Net income	$	9,904	$	9,904	$	13,333	$	13,333
Weighted average basic shares outstanding	21,655		21,655		21,570		21,570
Dilutive effect of stock-based awards			94				110
Weighted average diluted shares outstanding			21,749				21,680
Earnings per share	$	0.46	$	0.46	$	0.62	$	0.61
Anti-dilutive shares excluded from calculation			181				78

	Nine Months Ended September 30,
$s and shares in thousands, except per share	2015				2014
amounts	Basic		Diluted		Basic		Diluted
Net income	$	17,907	$	17,907	$	29,558	$	29,558
Weighted average basic shares outstanding	21,619		21,619		21,526		21,526
Dilutive effect of stock-based awards			104				123
Weighted average diluted shares outstanding			21,723				21,649
Earnings per share	$	0.83	$	0.82	$	1.37	$	1.37
Anti-dilutive shares excluded from calculation			192				50

NOTE 14.EQUITY

Omnibus Incentive Plan

On May 27, 2015, our stockholders approved the Omnibus Incentive Plan (“Omnibus Plan”), which was approved by our Board of Directors on April 7, 2015. The Omnibus Plan provides, among other things, the ability for the Company to grant restricted stock, performance stock, options, stock appreciation rights, restricted stock units, performance stock units (“PSUs”) and other stock-based awards or cash awards to officers, employees, consultants and non-employee directors. We will cease to grant equity awards under our 2008 Stock Option Incentive Plan and our 2006 Restricted Stock Plan (“Previous Plans”), and the Previous Plans will remain in effect solely for the settlement of awards granted under the Previous Plans. No shares that are reserved but unissued under the Previous Plans or that are outstanding under the Previous Plans and reacquired by the Company for any reason will be available for issuance under the Omnibus Plan. The Omnibus Plan expires on April 7, 2025 and authorizes 1.5 million shares of common stock for grant over the life of the Omnibus Plan.

17

Performance Stock Units

On May 27, 2015, the Company granted 6,929 PSUs to certain employees. Each PSU represents the right to receive, on the settlement date, one share of the Company’s common stock. The total number of PSUs each participant is eligible to earn ranges from 0% to 200% of the target number of PSUs granted. The actual number of PSUs that will vest and be settled in shares is determined at the end of a three-year performance period beginning January 1, 2015, based on total stockholder return relative to a set of peer companies. The fair value of the PSUs estimated on the grant date using a Monte Carlo simulation was $65.78 per unit. Compensation expense is recorded over the awards’ vesting period.

The following table presents the assumptions used in the Monte Carlo simulation to calculate the fair value of the PSUs granted on May 27, 2015:

Expected volatility	29.30		%
Stock price on grant date	$	46.89
Risk-free interest rate	0.86		%
Expected term (years)	2.6
Expected dividend yield	1.50		%

Stock Options and Restricted Stock

During the nine months ended September 30, 2015, option holders exercised 73,601 options with a weighted-average exercise price of $24.05 per option. Option holders exercised 3,334 of these options via net share settlement. During the nine months ended September 30, 2015, the Company issued 6,583 shares of restricted stock from our treasury stock at an average cost of $44.34 per share.

NOTE 15.COMMITMENTS AND CONTINGENCIES

Litigation and Regulatory Proceedings

In the ordinary course of business, we are involved in judicial and administrative proceedings involving federal, state, provincial or local governmental authorities, including regulatory agencies that oversee and enforce compliance with permits. Fines or penalties may be assessed by our regulators for non-compliance. Actions may also be brought by individuals or groups in connection with permitting of planned facilities, modification or alleged violations of existing permits, or alleged damages suffered from exposure to hazardous substances purportedly released from our operated sites, as well as other litigation. We maintain insurance intended to cover property and damage claims asserted as a result of our operations. Periodically, management reviews and may establish reserves for legal and administrative matters, or other fees expected to be incurred in relation to these matters.

We are not currently a party to any material pending legal proceedings and are not aware of any other claims that could, individually or in the aggregate, have a materially adverse effect on our financial position, results of operations or cash flows.

NOTE 16.   OPERATING SEGMENTS

Financial Information by Segment

Our operations are managed in two reportable segments reflecting our internal reporting structure and nature of services offered as follows:

Environmental Services - This segment includes all of the legacy US Ecology operations and the legacy EQ treatment and disposal facilities. It provides a broad range of hazardous material management services including transportation, recycling, treatment and disposal of hazardous and non-hazardous waste at Company-owned landfill, wastewater and other treatment facilities.

Field & Industrial Services - This segment includes all of the field and industrial service business of the legacy EQ operation. It provides packaging and collection of hazardous waste and total waste management solutions at customer sites and through our 10-day transfer facilities. Services include on-site management, waste characterization, transportation and disposal of non-hazardous and hazardous waste. This segment also provides specialty services such as high-pressure and chemical cleaning, centrifuge and materials processing, tank cleaning, decontamination, remediation, transportation, spill cleanup and emergency response and other services to commercial and industrial facilities and to government entities.

18

The operations not managed through our two reportable segments are recorded as “Corporate.” Corporate selling, general and administrative expenses include typical corporate items such as legal, accounting and other items of a general corporate nature. Income taxes are assigned to Corporate, but all other items are included in the segment where they originated. Inter-company transactions have been eliminated from the segment information and are not significant between segments.

Summarized financial information of our reportable segments is as follows:

	Three Months Ended September 30, 2015
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	76,079	$	—	$	—	$	76,079
Services Revenue:
Transportation and Logistics (1)	20,191		5,694		—		25,885
Industrial Cleaning (2)	—		27,532		—		27,532
Technical Services (3)	—		16,584		—		16,584
Remediation (4)	—		1,253		—		1,253
Other (5)	—		1,081		—		1,081
Total Revenue	$	96,270	$	52,144	$	—	$	148,414
Depreciation, amortization and accretion	$	8,664	$	1,885	$	126	$	10,675
Capital expenditures	$	4,480	$	1,401	$	436	$	6,317
Total assets	$	599,136	$	201,627	$	62,613	$	863,376

	Three Months Ended September 30, 2014
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	84,778	$	—	$	—	$	84,778
Services Revenue:
Transportation and Logistics (1)	23,256		11,657		—		34,913
Industrial Cleaning (2)	—		22,142		—		22,142
Technical Services (3)	—		15,985		—		15,985
Remediation (4)	—		11,814		—		11,814
Other (5)	—		1,232		—		1,232
Total Revenue	$	108,034	$	62,830	$	—	$	170,864
Depreciation, amortization and accretion	$	9,748	$	3,271	$	276	$	13,295
Capital expenditures	$	4,924	$	3,822	$	506	$	9,252
Total assets	$	627,340	$	229,971	$	59,838	$	917,149

19

	Nine Months Ended September 30, 2015
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	224,007	$	—	$	—	$	224,007
Services Revenue:
Transportation and Logistics (1)	54,878		19,986		—		74,864
Industrial Cleaning (2)	—		69,980		—		69,980
Technical Services (3)	—		46,807		—		46,807
Remediation (4)	—		5,492		—		5,492
Other (5)	—		3,647		—		3,647
Total Revenue	$	278,885	$	145,912	$	—	$	424,797
Depreciation, amortization and accretion	$	26,167	$	7,920	$	405	$	34,492
Capital expenditures	$	17,564	$	6,250	$	1,879	$	25,693
Total assets	$	599,136	$	201,627	$	62,613	$	863,376

	Nine Months Ended September 30, 2014
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	178,254	$	—	$	—	$	178,254
Services Revenue:
Transportation and Logistics (1)	41,012		12,895		—		53,907
Industrial Cleaning (2)	—		25,827		—		25,827
Technical Services (3)	—		17,994		—		17,994
Remediation (4)	—		12,841		—		12,841
Other (5)	—		1,414		—		1,414
Total Revenue	$	219,266	$	70,971	$	—	$	290,237
Depreciation, amortization and accretion	$	19,415	$	3,759	$	464	$	23,638
Capital expenditures	$	12,751	$	4,410	$	749	$	17,910
Total assets	$	627,340	$	229,971	$	59,838	$	917,149

(1)Includes such services as collection, transportation and disposal of non-hazardous and hazardous waste. Prior to the acquisition of EQ on June 17, 2014, services within Environmental Services included transportation services.

(2)Includes such services as industrial cleaning and maintenance for utilities, refineries, chemical plants, pulp and paper mills, steel and automotive plants, and refinery services such as tank cleaning, centrifuge and temporary storage.

(3)Includes such services as Total Waste Management (“TWM”) programs, retail services, laboratory packing, less-than-truck-load (“LTL”) service and Household Hazardous Waste (“HHW”) collection.

(4)Includes such services as site assessment, onsite treatment, project management and remedial action planning and execution.

(5)Includes such services as emergency response and marine.

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

The primary financial measure used by management to assess segment performance is Adjusted EBITDA. Adjusted EBITDA is defined as net income before net interest expense, income tax expense, depreciation, amortization, stock based compensation, accretion of closure and post-closure liabilities, foreign currency gain/loss, non-cash impairment charges and other income/expense, which are not considered part of usual business operations. Adjusted EBITDA is a complement to results provided in accordance with GAAP and we believe that such information provides additional useful information to analysts, stockholders and other users to understand the Company’s operating performance. Since Adjusted EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies. Items excluded from Adjusted EBITDA are significant components in understanding and assessing our financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or a substitute for analyzing our results as reported under GAAP. Some of the limitations are:

20

·Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

·Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt;

·Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes;

·Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; and

·Although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

A reconciliation of Adjusted EBITDA to Net Income is as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
$s in thousands	2015			2014			2015			2014
Adjusted EBITDA:
Environmental Services	$	39,244		$	45,483		$	112,859		$	94,966
Field & Industrial Services	5,611			6,136			13,709			7,256
Corporate	(11,101		)	(11,180		)	(34,161		)	(24,413		)
Total	33,754			40,439			92,407			77,809
Reconciliation to Net income:
Income tax expense	(6,858		)	(8,406		)	(14,815		)	(17,880		)
Interest expense	(5,081		)	(4,543		)	(16,208		)	(5,488		)
Interest income	17			11			64			94
Foreign currency loss	(994		)	(830		)	(1,769		)	(1,027		)
Other income	387			301			1,156			557
Impairment charges	—			—			(6,700		)	—
Depreciation and amortization of plant and equipment	(6,591		)	(8,318		)	(21,726		)	(16,730		)
Amortization of intangibles	(2,952		)	(4,018		)	(9,558		)	(5,233		)
Stock-based compensation	(646		)	(344		)	(1,736		)	(869		)
Accretion and non-cash adjustment of closure & post-closure liabilities	(1,132		)	(959		)	(3,208		)	(1,675		)
Net income	$	9,904		$	13,333		$	17,907		$	29,558

Revenue, Property and Equipment and Intangible Assets Outside of the United States

We provide services in the United States and Canada. Revenues by geographic location where the underlying services were performed were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
$s in thousands	2015		2014		2015		2014
United States	$	138,367	$	155,043	$	392,698	$	243,689
Canada	10,047		15,821		32,099		46,548
Total revenue	$	148,414	$	170,864	$	424,797	$	290,237

21

Long-lived assets, comprised of property and equipment and intangible assets net of accumulated depreciation and amortization, by geographic location are as follows:

	September 30,		December 31,
$s in thousands	2015		2014
United States	$	396,295	$	446,412
Canada	51,279		59,939
Total long-lived assets	$	447,574	$	506,351

NOTE 17.SUBSEQUENT EVENTS

Quarterly Dividend

On October 1, 2015, we declared a quarterly dividend of $0.18 per common share to stockholders of record on October 21, 2015. The dividend was paid using cash on hand on October 28, 2015 in an aggregate amount of $3.9 million.

Allstate Disposition

On November 1, 2015, we completed the sale of Allstate for cash proceeds of $58.8 million, subject to post-closing adjustments for working capital. See Note 3 for additional information on the sale of Allstate including Income before income taxes and details on the major classes of assets and liabilities of Allstate classified as held for sale as of September 30, 2015.

22

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

US Ecology, Inc.

Boise, Idaho

We have reviewed the accompanying consolidated balance sheet of US Ecology, Inc. and subsidiaries (the “Company”) as of September 30, 2015, and the related consolidated statements of operations and comprehensive income for the three-month and nine-month periods ended September 30, 2015 and 2014, and the consolidated statements of cash flows for the nine-month periods ended September 30, 2015 and 2014. This interim financial information is the responsibility of the Company’s management.

We conducted our reviews in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial information taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should be made to such consolidated interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of US Ecology, Inc. and subsidiaries as of December 31, 2014, and the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for the year then ended (not presented herein); and in our report dated March 2, 2015, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2014 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ Deloitte & Touche LLP

Boise, Idaho

November 4, 2015

23

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

The information contained in this section should be read in conjunction with our unaudited consolidated financial statements and related notes thereto appearing elsewhere in this quarterly report on Form 10-Q. In this report words such as “we,” “us,” “our,” “US Ecology” and the “Company” refer to US Ecology, Inc. and its subsidiaries.

OVERVIEW

US Ecology, Inc. is a leading North American provider of environmental services to commercial and government entities. The Company addresses the complex waste management needs of its customers, offering treatment, disposal and recycling of hazardous, non-hazardous and radioactive waste, as well as a wide range of complementary field and industrial services. US Ecology’s comprehensive knowledge of the waste business, its collection of waste management facilities combined and focus on safety, environmental compliance, and customer service enables us to effectively meet the needs of our customers and to build long-lasting relationships. Headquartered in Boise, Idaho, we are one of the oldest providers of such services in North America.

Prior to June 17, 2014, our operations consisted primarily of our six fixed facilities located near Beatty, Nevada; Richland, Washington; Robstown, Texas; Grand View, Idaho; Detroit, Michigan and Blainville, Québec, Canada. These facilities generate revenue from fees charged to treat and dispose of waste and from fees charged to perform various field and industrial services for our customers.

On June 17, 2014, the Company acquired 100% of the outstanding shares of EQ Holdings, Inc. and its wholly-owned subsidiaries (collectively “EQ”). EQ is a fully integrated environmental services company providing waste treatment and disposal, wastewater treatment, remediation, recycling, industrial cleaning and maintenance, transportation, total waste management, technical services, and emergency response services to a variety of industries and customers in North America.

Our operations are managed in two reportable segments reflecting our internal management reporting structure and nature of services offered as follows:

Environmental Services - This segment includes all of the legacy US Ecology operations and the legacy EQ treatment and disposal facilities. It provides a broad range of hazardous material management services including transportation, recycling, treatment and disposal of hazardous and non-hazardous waste at Company-owned landfill, wastewater and other treatment facilities.

Field & Industrial Services - This segment includes all of the field and industrial service business of the legacy EQ operation. It provides packaging and collection of hazardous waste and total waste management solutions at customer sites and through our 10-day transfer facilities. Services include on-site management, waste characterization, transportation and disposal of non-hazardous and hazardous waste. This segment also provides specialty services such as high-pressure and chemical cleaning, centrifuge and materials processing, tank cleaning, decontamination, remediation, transportation, spill cleanup and emergency response and other services to commercial and industrial facilities and to government entities.

On August 4, 2015, we entered into a definitive agreement to sell our Allstate Power Vac, Inc. (“Allstate”) subsidiary to a private investor group for approximately $58.0 million cash, subject to adjustments for working capital and capital expenditures. Cash proceeds from the transaction are expected to be used to repay indebtedness. Allstate represents the majority of the industrial services business we acquired with the acquisition of EQ.  As a result of this agreement and management’s strategic review, we evaluated the recoverability of the assets associated with our industrial services business. Based on this analysis, we recorded a non-cash goodwill impairment charge of $6.7 million, or $0.31 per diluted share, in the second quarter of 2015. On November 1, 2015, we completed the sale of Allstate, for cash proceeds of $58.8 million, subject to post-closing adjustments for working capital. See Note 3 of the Notes to Consolidated Financial Statements in “Part I, Item 1. Financial Statements” of this Form 10-Q for additional information on the sale of Allstate including Income before income taxes and details on the major classes of assets and liabilities of Allstate classified as held for sale as of September 30, 2015.

In conjunction with the continued integration of EQ we have changed and conformed the categories used to evaluate period-to-period changes in our treatment and disposal (“T&D”) revenue for our Environmental Services segment. Historically, legacy US Ecology divided T&D revenue into groups based on the industry of the customer. In order to provide better insight into the underlying drivers of our waste volumes and related T&D revenues, beginning with the third quarter of 2015, we will evaluate period-to-period changes in our ES segment T&D revenues based on the industry of the waste generator, based on North American Industry Classification System (“NAICS”) codes.

Additionally, we have changed and conformed how we define “Base Business” and “Event Business”. Previously, US Ecology defined Event Business as non-recurring waste cleanup projects regardless of size, with Base Business representing all recurring business.

24

Beginning with the third quarter of 2015, we now define Event Business as non-recurring projects that are expected to equal or exceed 1,000 tons, with Base Business defined as all other business not meeting the definition of Event Business. We believe the new definitions are a better representation of Base and Event Business and will provide better insight into ES segment T&D revenues.  Throughout this document, and in our discussions of our results for the three and nine months ended September 30, 2015, prior periods presented have been recast based on the new definitions.

The composition of Environmental Services segment T&D revenues by waste generator industry for the three and nine months ended September 30, 2015 and 2014 were as follows:

	% of Treatment and Disposal Revenue (1) for the Three Months Ended September 30,
Generator Industry	2015	2014
Chemical Manufacturing	16%	23%
Metal Manufacturing	14%	15%
Broker / Treatment, Storage & Disposal Facilities (“TSDF”)	14%	13%
General Manufacturing	12%	10%
Refining	10%	8%
Government	8%	7%
Mining, Exploration & Production	2%	4%
Transportation	3%	3%
Utilities	4%	3%
Waste Management & Remediation	2%	3%
Other (2)	15%	11%

(1) Excludes all transportation service revenue

(2) Includes retail and wholesale trade, rate regulated, construction and other industries

	% of Treatment and Disposal Revenue (1),(2) for the Nine Months Ended September 30,
Generator Industry	2015	2014
Chemical Manufacturing	16%	24%
Broker / TSDF	17%	16%
Refining	17%	13%
Metal Manufacturing	11%	12%
General Manufacturing	7%	7%
Mining, Exploration and Production	4%	6%
Government	8%	5%
Transportation	2%	4%
Utilities	5%	3%
Waste Management & Remediation	2%	2%
Other (3)	11%	8%

(1) Excludes all transportation service revenue

(2) Excludes EQ Holdings, Inc. which was acquired on June 17, 2014

(3) Includes retail and wholesale trade, rate regulated, construction and other industries

A significant portion of our disposal revenue is attributable to discrete Event Business projects which vary widely in size, duration and unit pricing. For the three months ended September 30, 2015, Event Business revenue decreased 22% compared to the three months ended September 30, 2014. Event Business revenue was approximately 24% of total T&D revenue for the three months ended September 30, 2015, down from 28% for the three months ended September 30, 2014. For the nine months ended September 30, 2015, Event Business revenue (excluding EQ) decreased 18% compared to the nine months ended September 30, 2014. Event Business revenue,

25

excluding EQ, was approximately 28% of total T&D revenue for the nine months ended September 30, 2015, down from 32% for the nine months ended September 30, 2014.

For the three months ended September 30, 2015, Base Business revenue decreased 7% compared to the three months ended September 30, 2014. Base Business revenue was approximately 76% of total T&D revenue for the three months ended September 30, 2015, up from 72% for the three months ended September 30, 2014. For the nine months ended September 30, 2015, Base Business revenue, excluding EQ, decreased 2% compared to the nine months ended September 30, 2014. Base Business revenue (excluding EQ) was approximately 72% of total T&D revenue for the nine months ended September 30, 2015, up from 68% for the nine months ended September 30, 2014. Our business is highly competitive and no assurance can be given that we will maintain these revenue levels or increase our market share.

The one-time nature of Event Business, diverse spectrum of waste types received and widely varying unit pricing necessarily creates variability in revenue and earnings. This variability may be influenced by general and industry-specific economic conditions, funding availability, changes in laws and regulations, government enforcement actions or court orders, public controversy, litigation, weather, commercial real estate, closed military bases and other redevelopment project timing, government appropriation and funding cycles and other factors. The types and amounts of waste received from Base Business also vary from quarter to quarter. This variability can cause significant quarter-to-quarter and year-to-year differences in revenue, gross profit, gross margin, operating income and net income. Also, while we pursue many large projects months or years in advance of work performance, both large and small clean-up project opportunities routinely arise with little or no prior notice. These market dynamics are inherent to the waste disposal business and are factored into our projections and externally communicated business outlook statements. Our projections combine historical experience with identified sales pipeline opportunities, new or expanded service line projections and prevailing market conditions.

Depending on project-specific customer needs and competitive economics, transportation services may be offered at or near our cost to help secure new business. For waste transported by rail from the eastern United States and other locations distant from our Grand View, Idaho and Robstown, Texas facilities, transportation-related revenue can account for as much as 75% of total project revenue. While bundling transportation and disposal services reduces overall gross profit as a percentage of total revenue (“gross margin”), this value-added service has allowed us to win multiple projects that management believes we could not have otherwise competed for successfully. Our Company-owned fleet of gondola railcars, which is periodically supplemented with railcars obtained under operating leases, has reduced our transportation expenses by largely eliminating reliance on more costly short-term rentals. These Company-owned railcars also help us to win business during times of demand-driven railcar scarcity.

The increased waste volumes resulting from projects won through this bundling service strategy further drive the operating leverage benefits inherent to the disposal business, increasing profitability. While waste treatment and other variable costs are project-specific, the incremental earnings contribution from large and small projects generally increases as overall disposal volumes increase. Based on past experience, management believes that maximizing operating income, net income and earnings per share is a higher priority than maintaining or increasing gross margin. We intend to continue aggressively bidding bundled transportation and disposal services based on this proven strategy.

To maximize utilization of our railcar fleet, we periodically deploy available railcars to transport waste from clean-up sites to disposal facilities operated by other companies. Such transportation services may also be bundled with for-profit logistics and field services support work.

We serve oil refineries, chemical production plants, steel mills, waste brokers/aggregators serving small manufacturers and other industrial customers that are generally affected by the prevailing economic conditions and credit environment. Adverse conditions may cause our customers as well as those they serve to curtail operations, resulting in lower waste production and/or delayed spending on off-site waste shipments, maintenance, waste clean-up projects and other work. Factors that can impact general economic conditions and the level of spending by customers include, but are not limited to, consumer and industrial spending, increases in fuel and energy costs, conditions in the real estate and mortgage markets, labor and healthcare costs, access to credit, consumer confidence and other global economic factors affecting spending behavior. Market forces may also induce customers to reduce or cease operations, declare bankruptcy, liquidate or relocate to other countries, any of which could adversely affect our business. To the extent business is either government funded or driven by government regulations or enforcement actions, we believe it is less susceptible to general economic conditions. Spending by government agencies may also be reduced due to declining tax revenues resulting from a weak economy or changes in policy. Disbursement of funds appropriated by Congress may also be delayed for various reasons.

26

RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 2015 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2014

Operating results discussed below include a full quarter of EQ operations for both of the three month periods ended September 30, 2015 and 2014. Operating results and percentage of revenues, by reportable segment, were as follows:

	Three Months Ended September 30,								2015 vs. 2014
$s in thousands	2015			%	2014			%	$ Change			% Change
Revenue
Environmental Services	$	96,270		65%	$	108,034		63%	$	(11,764	)	-11%
Field & Industrial Services	52,144			35%	62,830			37%	(10,686		)	-17%
Total	148,414			100%	170,864			100%	(22,450		)	-13%
Gross Profit
Environmental Services	36,554			38%	42,700			40%	(6,146		)	-14%
Field & Industrial Services	9,386			18%	9,608			15%	(222		)	-2%
Total	45,940			31%	52,308			31%	(6,368		)	-12%
Selling, General & Administrative Expenses
Environmental Services	6,062			6%	7,006			6%	(944		)	-13%
Field & Industrial Services	5,712			11%	6,759			11%	(1,047		)	-15%
Corporate	11,733			n/a	11,743			n/a	(10		)	0%
Total	23,507			16%	25,508			15%	(2,001		)	-8%
Adjusted EBITDA
Environmental Services	39,244			41%	45,483			42%	(6,239		)	-14%
Field & Industrial Services	5,611			11%	6,136			10%	(525		)	-9%
Corporate	(11,101		)	n/a	(11,180		)	n/a	79			-1%
Total	$	33,754		23%	$	40,439		24%	$	(6,685	)	-17%

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

The primary financial measure used by management to assess segment performance is Adjusted EBITDA. Adjusted EBITDA is defined as net income before net interest expense, income tax expense, depreciation, amortization, stock based compensation, accretion of closure and post-closure liabilities, foreign currency gain/loss, non-cash impairment charges and other income/expense, which are not considered part of usual business operations. The reconciliation of Adjusted EBITDA to Net Income is as follows:

	Three Months Ended September 30,						2015 vs. 2014
$s in thousands	2015			2014			$ Change			% Change
Adjusted EBITDA	$	33,754		$	40,439		$	(6,685	)	-17%
Income tax expense	(6,858		)	(8,406		)	1,548			-18%
Interest expense	(5,081		)	(4,543		)	(538		)	12%
Interest income	17			11			6			55%
Foreign currency loss	(994		)	(830		)	(164		)	20%
Other income	387			301			86			29%
Depreciation and amortization of plant and equipment	(6,591		)	(8,318		)	1,727			-21%
Amortization of intangibles	(2,952		)	(4,018		)	1,066			-27%
Stock-based compensation	(646		)	(344		)	(302		)	88%
Accretion and non-cash adjustment of closure and post-closure liabilities	(1,132		)	(959		)	(173		)	18%
Net Income	$	9,904		$	13,333		$	(3,429	)	-26%

27

Adjusted EBITDA is a complement to results provided in accordance with accounting principles generally accepted in the United States (“GAAP”) and we believe that such information provides additional useful information to analysts, stockholders and other users to understand the Company’s operating performance. Since Adjusted EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies. Items excluded from Adjusted EBITDA are significant components in understanding and assessing our financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity.

Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or a substitute for analyzing our results as reported under GAAP. Some of the limitations are:

· Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

· Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt;

· Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes;

· Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; and

· Although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

Revenue

Total revenue decreased 13% to $148.4 million for the third quarter of 2015 compared with $170.9 million for the third quarter of 2014. The Allstate business, divested on November 1, 2015, contributed revenue of $20.1 million in the third quarter of 2015 compared to $17.0 million in the third quarter of 2014. Revenue from EQ is included in the percentages of Base and Event Business and customer category information in the following paragraphs.

Environmental Services

Environmental Services segment revenue decreased 11% to $96.3 million for the third quarter of 2015 compared to $108.0 million for the third quarter of 2014. T&D revenue decreased 10% for the third quarter of 2015 compared to the third quarter of 2014, primarily as a result of a 22% decrease in project-based Event Business. Transportation service revenue decreased 15% compared to the third quarter of 2014, reflecting fewer Event Business projects utilizing the Company’s transportation and logistics services. Tons of waste disposed of or processed decreased 16% for the third quarter of 2015 compared to the third quarter of 2014.

T&D revenue from recurring Base Business waste generators decreased 7% for the third quarter of 2015 compared to the third quarter of 2014 and comprised 76% of total T&D revenue. The decrease in Base Business T&D revenue compared to the prior year primarily reflects lower T&D revenue from the chemical and metal manufacturing, and mining, exploration and production industries. T&D revenue from Event Business waste generators decreased 22% for the third quarter of 2015 compared to the third quarter of 2014 and was 28% of T&D revenue for the third quarter of 2015. The decrease in Event Business T&D revenue compared to the prior year primarily reflects lower T&D revenue from the chemical manufacturing and waste management and remediation industries, partially offset by higher T&D revenue from the general manufacturing industry.  The decrease in revenue from the chemical manufacturing industry is primarily attributable to expected reductions in volume from a large East Coast remedial cleanup project and lower overall industry activity. The decrease in revenue from the metal manufacturing industry is primarily attributable to lower domestic production of metal related products and services. The decrease in revenue from the mining, exploration and production industry primarily reflects lower industry activity due to lower commodity prices.

28

The following table summarizes combined Base Business and Event Business T&D revenue growth by generator industry for the third quarter of 2015 as compared to the third quarter of 2014:

	Treatment and Disposal Revenue Growth Three Months Ended September 30, 2015 vs. Three Months Ended September 30, 2014
Utilities	30%
Other	12%
Refining	10%
General Manufacturing	5%
Government	4%
Broker / TSDF	-7%
Transportation	-11%
Metal Manufacturing	-15%
Chemical Manufacturing	-38%
Waste Management & Remediation	-39%
Mining and E&P	-43%

Field & Industrial Services

Field & Industrial Services segment revenue decreased 17% to $52.1 million for the third quarter of 2015 compared with $62.8 million for the third quarter of 2014. The decrease in segment revenue was primarily the result of lower project work in the Northeast remediation market. The Allstate business, divested on November 1, 2015, contributed segment revenue of $20.1 million in the third quarter of 2015 compared to $17.0 million in the third quarter of 2014.

Gross Profit

Total gross profit decreased 12% to $45.9 million for the third quarter of 2015, down from $52.3 million for the third quarter of 2014. Total gross margin was 31% for the third quarter of both 2015 and 2014.

Environmental Services

Environmental Services segment gross profit decreased 14% to $36.6 million for the third quarter of 2015, down from $42.7 million for the third quarter of 2014. This decrease primarily reflects lower treatment and disposal volumes for the third quarter of 2015 compared to the third quarter of 2014. Total segment gross margin for the third quarter of 2015 was 38% compared with 40% for the third quarter of 2014. T&D gross margin was 43% for the third quarter of 2015 compared with 45% for the third quarter of 2014.

Field & Industrial Services

Field & Industrial Services segment gross profit decreased 2% to $9.4 million (including $4.9 million from the Allstate business) for the third quarter of 2015, down from $9.6 million (including $3.7 million from the Allstate business) for the third quarter of 2014. Total segment gross margin was 18% for the third quarter of 2015 compared with 15% for the third quarter of 2014. The slight decrease in segment gross profit in the third quarter of 2015 compared to the third quarter of 2014 reflects a decrease in segment revenue as previously discussed, almost entirely offset by the increase in segment gross margin as a result of a more selective project bidding process.

Selling, General and Administrative Expenses (“SG&A”)

Total SG&A decreased to $23.5 million, or 16% of total revenue, for the third quarter of 2015 compared with $25.5 million, or 15% of total revenue, for the third quarter of 2014. The decrease in total SG&A primarily reflects lower labor and incentive compensation, lower depreciation and amortization and lower business development expenses for the third quarter of 2015 compared with the third quarter of 2014.

29

Environmental Services

Environmental Services segment SG&A decreased 13% to $6.1 million, or 6% of segment revenue, for the third quarter of 2015 compared with $7.0 million, or 6% of segment revenue, for the third quarter of 2014. The decrease in segment SG&A primarily reflects lower labor and incentive compensation, and lower depreciation and amortization for the third quarter of 2015 compared with the third quarter of 2014.

Field & Industrial Services

Field & Industrial Services segment SG&A decreased 15% to $5.7 million (including $3.2 million from the Allstate business), or 11% of segment revenue, for the third quarter of 2015 compared with $6.8 million (including $3.2 million from the Allstate business), or 11% of segment revenue, for the third quarter of 2014. The decrease in segment SG&A primarily reflects lower labor and incentive compensation, and lower depreciation and amortization for the third quarter of 2015 compared with the third quarter of 2014.

Corporate

Corporate SG&A was $11.7 million, or 8% of total revenue, for the third quarter of 2015 compared with $11.7 million, or 7% of total revenue, for the third quarter of 2014.

Components of Adjusted EBITDA

Income tax expense

Our effective income tax rate for the third quarter of 2015 was 40.9% compared with 38.7% for the third quarter of 2014. The increase primarily is a result of a lower proportion of earnings from our Canadian operations, which are taxed at a lower corporate rate.

Interest expense

Interest expense was $5.1 million for the third quarter of 2015 compared with $4.5 million for the third quarter of 2014. The increase is primarily due to net settlement payments due on the Company’s interest rate swap, partially offset by lower debt levels in the third quarter of 2015 compared with the third quarter of 2014.

Foreign currency loss

We recognized a $1.0 million non-cash foreign currency loss for the third quarter of 2015 compared with an $830,000 non-cash foreign currency loss for the third quarter of 2014. Foreign currency gains and losses reflect changes in business activity conducted in a currency other than the United States dollar (“USD”), our functional currency. Our Stablex facility is owned by our Canadian subsidiary, whose functional currency is the Canadian dollar (“CAD”). Also, as part of our treasury management strategy, we established intercompany loans between our parent company, US Ecology and Stablex. These intercompany loans are payable by Stablex to US Ecology in CAD requiring us to revalue the outstanding loan balance through our statements of operations based on USD/CAD currency movements from period to period. At September 30, 2015, we had $15.9 million of intercompany loans subject to currency revaluation.

Depreciation and amortization of plant and equipment

Depreciation and amortization expense was $6.6 million for the third quarter of 2015 compared with $8.3 million for the third quarter of 2014. The decrease in depreciation and amortization expense is primarily the result of the discontinuance of depreciation and amortization on Allstate’s long-lived plant and equipment assets when they were classified as held for sale on August 4, 2015 and EQ equipment assets assigned one-year lives as part of the purchase accounting valuation becoming fully-depreciated prior to the beginning of the third quarter of 2015.

Amortization of intangibles

Intangible assets amortization expense was $3.0 million for the third quarter of 2015 compared with $4.0 million for the third quarter of 2014. The decrease in amortization expense is primarily the result of the discontinuance of amortization on Allstate’s long-lived intangible assets when they were classified as held for sale on August 4, 2015 and EQ intangible assets assigned one-year lives as part of the purchase accounting valuation becoming fully-depreciated prior to the beginning of the third quarter of 2015.

30

Stock-based compensation

Stock-based compensation expense increased 88% to $646,000 for the third quarter of 2015 compared with $344,000 for the third quarter of 2014 as a result of an increase in equity-based awards granted to employees.

Accretion and non-cash adjustment of closure and post-closure liabilities

Accretion and non-cash adjustment of closure and post-closure liabilities was $1.1 million for the third quarter of 2015 compared with $1.0 million for the third quarter of 2014.

NINE MONTHS ENDED SEPTEMBER 30, 2015 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 2014

Operating results discussed below include a full nine months of EQ operations for the nine month period ended September 30, 2105 and only 3 months and 13 days of EQ operations for the nine month period ended September 30, 2014. Operating results and percentage of revenues, by reportable segment, were as follows:

	Nine Months Ended September 30,								2015 vs. 2014
$s in thousands	2015			%	2014			%	$ Change			% Change
Revenue
Environmental Services	$	278,885		66%	$	219,266		76%	$	59,619		27%
Field & Industrial Services	145,912			34%	70,971			24%	74,941			106%
Total	424,797			100%	290,237			100%	134,560			46%
Gross Profit
Environmental Services	103,938			37%	88,494			40%	15,444			17%
Field & Industrial Services	23,316			16%	11,079			16%	12,237			110%
Total	127,254			30%	99,573			34%	27,681			28%
Selling, General & Administrative Expenses
Environmental Services	17,483			6%	13,024			6%	4,459			34%
Field & Industrial Services	17,665			12%	7,599			11%	10,066			132%
Corporate	35,927			n/a	25,648			n/a	10,279			40%
Total	71,075			17%	46,271			16%	24,804			54%
Adjusted EBITDA
Environmental Services	112,859			40%	94,966			43%	17,893			19%
Field & Industrial Services	13,709			9%	7,256			10%	6,453			89%
Corporate	(34,161		)	n/a	(24,413		)	n/a	(9,748		)	40%
Total	$	92,407		22%	$	77,809		27%	$	14,598		19%

31

Adjusted EBITDA

As discussed above, the primary financial measure used by management to assess segment performance is Adjusted EBITDA. The reconciliation of Adjusted EBITDA to Net Income is as follows:

	Nine Months Ended September 30,						2015 vs. 2014
$s in thousands	2015			2014			$ Change			% Change
Adjusted EBITDA	$	92,407		$	77,809		$	14,598		19%
Income tax expense	(14,815		)	(17,880		)	3,065			-17%
Interest expense	(16,208		)	(5,488		)	(10,720		)	195%
Interest income	64			94			(30		)	-32%
Foreign currency loss	(1,769		)	(1,027		)	(742		)	72%
Other income	1,156			557			599			108%
Impairment charges	(6,700		)	—			(6,700		)	n/m
Depreciation and amortization of plant and equipment	(21,726		)	(16,730		)	(4,996		)	30%
Amortization of intangibles	(9,558		)	(5,233		)	(4,325		)	83%
Stock-based compensation	(1,736		)	(869		)	(867		)	100%
Accretion and non-cash adjustment of closure and post-closure liabilities	(3,208		)	(1,675		)	(1,533		)	92%
Net Income	$	17,907		$	29,558		$	(11,651	)	-39%

Revenue

Total revenue increased 46% to $424.8 million for the first nine months of 2015 compared with $290.2 million for the first nine months of 2014. The EQ operations, acquired on June 17, 2014, contributed revenue of $268.8 million for the first nine months of 2015 and $125.6 million for our three months and 13 days of ownership in the first nine months of 2014. The Allstate business, divested on November 1, 2015, contributed revenue of $51.0 million in the first nine months of 2015 compared to $19.6 million for our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, total revenue decreased 5% to $156.0 million for the first nine months of 2015 compared with $164.6 million for the first nine months of 2014. Revenue from EQ is excluded from percentages of Base and Event Business and generator industry information in the following paragraphs.

Environmental Services

Environmental Services segment revenue increased 27% to $278.9 million for the first nine months of 2015 compared to $219.3 million for the first nine months of 2014. The EQ operations, acquired June 17, 2014, contributed segment revenue of $122.9 million for the first nine months of 2015 and $54.7 million for our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, segment revenue decreased 5% to $156.0 million for the first nine months of 2015 compared with $164.6 million for the first nine months of 2014. T&D revenue (excluding EQ) decreased 7% for the first nine months of 2015 compared to the first nine months of 2014, primarily as a result of an 18% decrease in project-based Event Business. Transportation service revenue (excluding EQ) increased 5% compared to the first nine months of 2014, reflecting more Event Business projects utilizing the Company’s transportation and logistics services. Tons of waste disposed of or processed increased 31% for the first nine months of 2015 compared to the first nine months of 2014.  Excluding EQ, tons of waste disposed of or processed decreased 17% for the first nine months of 2015 compared to the first nine months of 2014.

T&D revenue from recurring Base Business waste generators decreased 2% for the first nine months of 2015 compared to the first nine months of 2014 and comprised 72% of total T&D revenue. The decrease in Base Business T&D revenue compared to the prior year primarily reflects lower T&D revenue from the chemical manufacturing, mining, exploration and production and utilities industries, partially offset by higher T&D revenue from the refining and broker/TSDF industries. T&D revenue from Event Business waste generators decreased 18% for the first nine months of 2015 compared to the first nine months of 2014 and was 28% of T&D revenue for the first nine months of 2015. The decrease in Event Business T&D revenue compared to the prior year primarily reflects lower T&D revenue from the chemical and metal manufacturing, transportation, broker/TSDF, and mining, exploration and production industries, partially offset by higher T&D revenue from the utilities, government and refining industries.

32

The following table summarizes combined Base Business and Event Business T&D revenue growth by generator industry for the first nine months of 2015 as compared to the first nine months of 2014:

	Treatment and Disposal Revenue Growth(1) Nine Months Ended September 30, 2015 vs. Nine Months Ended September 30, 2014
Government	41%
Utilities	35%
Refining	23%
General Manufacturing	5%
Other	2%
Broker / TSDF	2%
Waste Management & Remediation	0%
Metal Manufacturing	-18%
Chemical Manufacturing	-35%
Mining and E&P	-35%
Transportation	-40%

(1)   Excludes EQ Holdings, Inc. which was required on June 17, 2014

Field & Industrial Services

Field & Industrial Services segment revenue was $145.9 million for the first nine months of 2015 compared with $71.0 million for the first nine months of 2014, reflecting our three months and 13 days of ownership in the first nine months of 2014. The Allstate business, divested on November 1, 2015, contributed segment revenue of $51.0 million in the first nine months of 2015 compared to $19.6 million in the three months and 13 days of ownership in the first nine months of 2014. Our Field & Industrial Services segment was added subsequent to, and as a result of, our acquisition of EQ on June 17, 2014. This segment includes all of the field and industrial service business of the legacy EQ operations and none of the legacy US Ecology operations.

Gross Profit

Total gross profit increased 28% to $127.3 million for the first nine months of 2015, up from $99.6 million for the first nine months of 2014. The EQ operations, acquired on June 17, 2014, contributed gross profit of $67.0 million for the first nine months of 2015 and $32.2 million for our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, total gross profit decreased 11% to $60.3 million for the first nine months of 2015 compared with $67.4 million for the first nine months of 2014. Total gross margin for the first nine months of 2015 was 30%. Excluding EQ operations, total gross margin was 39%.

Environmental Services

Environmental Services segment gross profit increased 17% to $103.9 million for the first nine months of 2015, up from $88.5 million for the first nine months of 2014. The EQ operations, acquired on June 17, 2014, contributed segment gross profit of $43.6 million for the first nine months of 2015 and $21.1 million for our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, segment gross profit decreased 11% to $60.3 million for the first nine months of 2015 compared with $67.4 million for the first nine months of 2014. This decrease primarily reflects lower treatment and disposal volumes for the first nine months of 2015 compared to the first nine months of 2014. Total segment gross margin for the first nine months of 2015 was 37%. Excluding EQ operations, total segment margin was 39%. T&D gross margin (excluding EQ) was 48% for the first nine months of 2015 compared with 50% for the first nine months of 2014.

Field & Industrial Services

Field & Industrial Services segment gross profit was $23.3 million (including $10.8 million from the Allstate business) and segment gross margin was 16% for the first nine months of 2015 compared with segment gross profit of $11.1 million (including $4.2 million from the Allstate business) and segment gross margin of 16% for the first nine months of 2014, reflecting our three months and 13 days of ownership in the first nine months of 2014. Our Field & Industrial Services segment was added subsequent to, and as a result of, our acquisition of EQ on June 17, 2014.

Selling, General and Administrative Expenses (“SG&A”)

Total SG&A increased to $71.1 million for the first nine months of 2015, up from $46.3 million for the first nine months of 2014. The EQ operations, acquired on June 17, 2014, contributed SG&A of $44.2 million for the first nine months of 2015 and $20.2 million for

33

our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, total SG&A was $26.9 million, or 17% of total revenue, for the first nine months of 2015 compared with $26.1 million, or 16% of total revenue, for the first nine months of 2014.

Environmental Services

Environmental Services segment SG&A increased 34% to $17.5 million, or 6% of segment revenue, for the first nine months of 2015, up from $13.0 million, or 6% of segment revenue, for the first nine months of 2014. The EQ operations, acquired on June 17, 2014, contributed segment SG&A of $9.3 million for the first nine months of 2015 and $4.5 million for our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, total segment SG&A was $8.2 million, or 5% of segment revenue, for the first nine months of 2015 compared with $8.5 million, or 5% of segment revenue, for the first nine months of 2014.

Field & Industrial Services

Field & Industrial Services segment SG&A was $17.7 million (including $16.6 million from the Allstate business), or 12% of segment revenue, for the first nine months of 2015 compared with $7.6 million (including $3.6 million from the Allstate business), or 11% of segment revenue, for the first nine months of 2014, reflecting our three months and 13 days of ownership in the first nine months of 2014. Our Field & Industrial Services segment was added subsequent to, and as a result of, our acquisition of EQ on June 17, 2014.

Corporate

Corporate SG&A increased 40% to $35.9 million for the first nine months of 2015, up from $25.6 million for the first nine months of 2014. The EQ operations, acquired on June 17, 2014, contributed corporate SG&A of $17.2 million for the first nine months of 2015 and $8.1 million for our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, total corporate SG&A was $18.7 million, or 12% of total revenue, for the first nine months of 2015 compared with $17.5 million, or 11% of total revenue, for the first nine months of 2014, primarily reflecting higher labor costs and professional fees and expenses, partially offset by lower business development expenses in the first nine months of 2015 compared to the first nine months of 2014.

Components of Adjusted EBITDA

Income tax expense

Our effective income tax rate for the first nine months of 2015 was 37.6%, excluding impairment charges of $6.7 million, compared to 37.7% for the first nine months of 2014.

Interest expense

Interest expense was $16.2 million for the first nine months of 2015 compared with $5.5 million in the first nine months of 2014. The increase is a result of higher debt levels and the related interest expense on borrowings under the Company’s credit facility used to finance the acquisition of EQ in June 2014.

Foreign currency loss

We recognized a $1.8 million non-cash foreign currency loss for the first nine months of 2015 compared with a $1.0 million non-cash foreign currency loss in the first nine months of 2014. Foreign currency gains and losses reflect changes in business activity conducted in a currency other than the USD, our functional currency. Our Stablex facility is owned by our Canadian subsidiary, whose functional currency is the CAD. Also, as part of our treasury management strategy, we established intercompany loans between our parent company, US Ecology, and Stablex. These intercompany loans are payable by Stablex to US Ecology in CAD requiring us to revalue the outstanding loan balance through our statements of operations based on USD/CAD currency movements from period to period. At September 30, 2015, we had $15.9 million of intercompany loans subject to currency revaluation.

Impairment charges

On August 4, 2015, we entered into a definitive agreement to sell Allstate to a private investor group for approximately $58.0 million cash, subject to adjustments for working capital and capital expenditures. Allstate represents the majority of the industrial services business we acquired with the acquisition of EQ. See Note 3 of the Notes to Consolidated Financial Statements in “Part I, Item 1. Financial Statements” of this Form 10-Q. As a result of this agreement and management’s strategic review, we evaluated the recoverability of the assets associated with our industrial services business. Based on this analysis, we recorded a non-cash goodwill impairment charge of $6.7 million, or $0.31 per diluted share, in the second quarter of 2015.

34

Depreciation and amortization of plant and equipment

Depreciation and amortization expense was $21.7 million for the first nine months of 2015 compared with $16.7 million for the first nine months of 2014. The EQ operations, acquired on June 17, 2014, contributed depreciation and amortization expense of $11.1 million for the first nine months of 2015 and $5.2 million for our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, depreciation and amortization expense was $10.6 million for the first nine months of 2015 compared with $11.5 million for the first nine months of 2014.

Amortization of intangibles

Intangible assets amortization expense was $9.6 million for the first nine months of 2015 compared with $5.2 million for the first nine months of 2014. Excluding $8.6 million of intangible assets amortization expense on new intangible assets recorded as a result of the acquisition of EQ on June 17, 2014, intangible assets amortization expense was $934,000 for the first nine months of 2015 compared with $1.1 million for the first nine months of 2014.

Stock-based compensation

Stock-based compensation expense increased 100% to $1.7 million for the first nine months of 2015 compared with $869,000 for the first nine months of 2014 as a result of an increase in equity-based awards granted to employees.

Accretion and non-cash adjustment of closure and post-closure liabilities

Accretion and non-cash adjustment of closure and post-closure liabilities was $3.2 million for the first nine months of 2015 compared with $1.7 million for the first nine months of 2014. The EQ operations, acquired June 17, 2014, contributed accretion and non-cash adjustment of closure and post-closure liabilities of $1.8 million during the first nine months of 2015 and $560,000 for our three months and 13 days of ownership in the first nine months of 2014. Excluding EQ operations, accretion and non-cash adjustment of closure and post-closure liabilities was $1.4 million for the first nine months of 2015 compared with $1.1 million for the first nine months of 2014.

CRITICAL ACCOUNTING POLICIES

Financial statement preparation requires management to make estimates and judgments that affect reported assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. The accompanying unaudited consolidated financial statements are prepared using the same critical accounting policies disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

LIQUIDITY AND CAPITAL RESOURCES

Our primary sources of liquidity are cash and cash equivalents, cash generated from operations and borrowings under the Credit Agreement. At September 30, 2015, we had $9.4 million in cash and cash equivalents immediately available and $118.2 million of borrowing capacity available under our Revolving Credit Facility. We assess our liquidity in terms of our ability to generate cash to fund our operating, investing and financing activities. Our primary ongoing cash requirements are funding operations, capital expenditures, paying interest and required principal payments on our long-term debt, and paying declared dividends pursuant to our dividend policy. We believe future operating cash flows will be sufficient to meet our future operating, investing and dividend cash needs for the foreseeable future. Furthermore, existing cash balances and availability of additional borrowings under our Credit Agreement (as defined below) provide additional sources of liquidity should they be required.

Operating Activities

For the nine months ended September 30, 2015, net cash provided by operating activities was $57.0 million. This primarily reflects net income of $17.9 million, non-cash depreciation, amortization and accretion of $34.5 million, non-cash impairment charges of $6.7 million, a decrease in accounts receivable of $7.2 million, a decrease in income taxes receivable of $6.6 million, unrealized foreign currency losses of $2.7 million, share-based compensation expense of $1.7 million, and a decrease in other assets of $1.8 million, partially offset by a decrease in deferred revenue of $5.4 million, a decrease in accounts payable and accrued liabilities of $5.3 million, a decrease in closure and post-closure obligations of $4.4 million, a decrease in deferred income taxes of $4.0 million, a decrease in income taxes payable of $2.3 million and a decrease in accrued salaries and benefits of $1.9 million. Impacts on net income are due to the factors discussed above under Results of Operations. The decrease in receivables and deferred revenue is primarily attributable to the timing of the treatment and disposal of waste associated with a significant east coast clean-up project. The changes in income taxes payable and receivable are primarily attributable to the timing of income tax payments. The decrease in closure and post-closure obligations is primarily attributable to payments made for closure and post-closure activities primarily at our closed landfills. The decrease in accrued salaries and benefits is primarily attributable to cash payments during 2015 for accrued fiscal year 2014 incentive compensation.

35

Days sales outstanding were 76 days as of September 30, 2015, compared to 77 days as of December 31, 2014 and 79 days as of September 30, 2014.

For the nine months ended September 30, 2014, net cash provided by operating activities was $31.2 million. This primarily reflects net income of $29.6 million, non-cash depreciation, amortization and accretion of $23.7 million, an increase in accounts payable and accrued liabilities of $2.4 million, an increase in deferred income taxes of $2.4 million, and unrealized foreign currency losses of $1.5 million, partially offset by an increase in receivables of $20.9 million, an increase in other assets of $3.2 million, a decrease in income taxes payable of $2.3 million, and a decrease in accrued salaries and benefits of $1.9 million. Impacts on net income are due to the factors discussed above under Results of Operations. The increase in receivables is primarily attributable to the timing of the treatment and disposal of waste associated with a significant east coast clean-up project. The changes in income taxes payable and receivable are primarily attributable to the timing of income tax payments. The decrease in accrued salaries and benefits is primarily attributable to cash payments during 2014 for accrued fiscal year 2013 incentive compensation.

Investing Activities

For the nine months ended September 30, 2015, net cash used in investing activities was $25.3 million, primarily related to capital expenditures of $25.7 million. Significant capital projects included construction of additional disposal capacity at our Blainville, Quebec, Canada and Robstown, Texas locations and equipment purchases and infrastructure upgrades at all of our corporate and operating facilities.

For the nine months ended September 30, 2014, net cash used in investing activities was $483.1 million, primarily related to the purchase of EQ for $465.9 million, net of cash acquired, and capital expenditures of $17.9 million. Significant capital projects included construction of additional disposal capacity at our Blainville, Quebec, Canada location and equipment purchases and infrastructure upgrades at all of our operating facilities.

Financing Activities

For the nine months ended September 30, 2015, net cash used in financing activities was $44.9 million, consisting primarily of $34.8 million of payments on the Company’s term loan and $11.7 million of dividend payments to our stockholders.

For the nine months ended September 30, 2014, net cash provided by financing activities was $388.9 million, consisting primarily of $414.0 million of net proceeds from the Company’s new term loan used to partially finance the acquisition of EQ, offset in part by $14.0 million of deferred financing costs associated with the Company’s new Credit Agreement and $11.6 million of dividend payments to our stockholders.

Credit Facility

On June 17, 2014, in connection with the acquisition of EQ, the Company entered into a new $540.0 million senior secured credit agreement (the “Credit Agreement”) with a syndicate of banks comprised of a $415.0 million term loan (the “Term Loan”) with a maturity date of June 17, 2021 and a $125.0 million revolving line of credit (the “Revolving Credit Facility”) with a maturity date of June 17, 2019. Upon entering into the Credit Agreement, the Company terminated its existing credit agreement with Wells Fargo, dated October, 29, 2010, as amended (the “Former Agreement”). Immediately prior to the termination of the Former Agreement, there were no outstanding borrowings under the Former Agreement. No early termination penalties were incurred as a result of the termination of the Former Agreement.

Term Loan

The Term Loan provides an initial commitment amount of $415.0 million, the proceeds of which were used to acquire 100% of the outstanding shares of EQ and pay related transaction fees and expenses. The Term Loan bears interest at a base rate (as defined in the Credit Agreement) plus 2.00% or LIBOR plus 3.00%, at the Company’s option. The Term Loan is subject to amortization in equal quarterly installments in an aggregate annual amount equal to 1.00% of the original principal amount of the Term Loan. At September 30, 2015, the effective interest rate on the Term Loan, including the impact of our interest rate swap, was 4.67%. Interest only payments are due either monthly or on the last day of any interest period, as applicable. As set forth in the Credit Agreement, the Company is required to enter into one or more interest rate hedge agreements in amounts sufficient to fix the interest rate on at least 50% of the principal amount of the $415.0 million Term Loan. In October 2014, the Company entered into an interest rate swap agreement with Wells Fargo, effectively fixing the interest rate on $240.0 million, or 67%, of the Term Loan principal outstanding as of September 30, 2015.

36

Revolving Credit Facility

The Revolving Credit Facility provides up to $125.0 million of revolving credit loans or letters of credit with the use of proceeds restricted solely for working capital and other general corporate purposes. Under the Revolving Credit Facility, revolving loans are available based on a base rate (as defined in the Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to EBITDA. The Company is required to pay a commitment fee of 0.50% per annum on the unused portion of the Revolving Credit Facility, with such commitment fee to be reduced based upon the Company’s total leverage ratio as defined in the Credit Agreement. The maximum letter of credit capacity under the new revolving credit facility is $50.0 million and the Credit Agreement provides for a letter of credit fee equal to the applicable margin for LIBOR loans under the Revolving Credit Facility. Interest only payments are due either monthly or on the last day of any interest period, as applicable. At September 30, 2015, there were no borrowings outstanding on the Revolving Credit Facility. The availability under the Revolving Credit Facility was $118.2 million with $6.8 million of the Revolving Credit Facility issued in the form of standby letters of credit utilized as collateral for closure and post-closure financial assurance and other assurance obligations.

For more information about our debt, see Note 10, of the Notes to Consolidated Financial Statements in “Part I, Item 1. Financial Statements” of this Form 10-Q.

CONTRACTUAL OBLIGATIONS AND GUARANTEES

There were no material changes in the amounts of our contractual obligations and guarantees during the nine months ended September 30, 2015. For further information on our contractual obligations and guarantees, refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We do not maintain equities, commodities, derivatives, or any other similar instruments for trading purposes. We have minimal interest rate risk on investments or other assets due to our preservation of capital approach to investments. At September 30, 2015, $5.8 million of restricted cash was invested in fixed-income U.S. Treasury and U.S. government agency securities and money market accounts.

We are exposed to changes in interest rates as a result of our borrowings under the Credit Agreement. Under the Credit Agreement, Term Loan borrowings incur interest at a base rate (as defined in the Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin. Revolving loans under the Revolving Credit Facility are available based on a base rate (as defined in the Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to EBITDA. On October 29, 2014, the Company entered into an interest rate swap agreement with Wells Fargo with the intention of hedging the Company’s interest rate exposure on a portion of the Company’s outstanding LIBOR-based variable rate debt. Under the terms of the swap, the Company pays to Wells Fargo interest at the fixed effective rate of 5.17% and receives from Wells Fargo interest at the variable one-month LIBOR rate on an initial notional amount of $250.0 million.

As of September 30, 2015, there were $360.8 million of borrowings outstanding under the Term Loan, bearing an effective interest rate of 4.67% (including the impact of our interest rate swap), and no borrowings outstanding under the Revolving Credit Facility. If interest rates were to rise and outstanding balances remain unchanged, we would be subject to higher interest payments on our outstanding debt. Subsequent to the effective date of the interest rate swap on December 31, 2014, we are subject to higher interest payments on only the unhedged borrowings under the Credit Agreement.

Based on the outstanding indebtedness of $360.8 million under our Credit Agreement at September 30, 2015 and the impact of our interest rate hedge, if market rates used to calculate interest expense were to average 1% higher in the next twelve months, our interest expense would increase by approximately $591,000.

Foreign Currency Risk

We are subject to currency exposures and volatility because of currency fluctuations. The majority of our transactions are in USD; however, our Stablex subsidiary conducts business in both Canada and the United States. In addition, contracts for services Stablex provides to U.S. customers are generally denominated in USD. During the nine months ended September 30, 2015, Stablex transacted approximately 55% of its revenue in USD and at any time has cash on deposit in USD and outstanding USD trade receivables and payables related to these transactions. These USD cash, receivable and payable accounts are subject to non-cash foreign currency translation gains or losses. Exchange rate movements also affect the translation of Canadian generated profits and losses into USD.

37

We established intercompany loans between Stablex and US Ecology, Inc. as part of a tax and treasury management strategy allowing for repayment of third-party bank debt used to complete the acquisition. These intercompany loans are payable using CAD and are subject to mark-to-market adjustments with movements in the CAD. At September 30, 2015, we had $15.9 million of intercompany loans outstanding between Stablex and US Ecology. During the nine months ended September 30, 2015, the CAD weakened as compared to the USD resulting in a $2.2 million non-cash foreign currency translation loss being recognized in the Company’s Consolidated Statements of Operations related to the intercompany loans. Based on intercompany balances as of September 30, 2015, a $0.01 CAD increase or decrease in currency rate compared to the USD at September 30, 2015 would have generated a gain or loss of approximately $159,000 for the nine months ended September 30, 2015.

We had a total pre-tax foreign currency loss of $1.8 million for the nine months ended September 30, 2015. We currently have no foreign exchange contracts, option contracts or other foreign currency hedging arrangements. Management evaluates the Company’s risk position on an ongoing basis to determine whether foreign exchange hedging strategies should be employed.

ITEM 4. CONTROLS AND PROCEDURES

Management of the Company, including the Chief Executive Officer and the Chief Financial Officer of the Company, have evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of September 30, 2015. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures, including the accumulation and communication of disclosures to the Company’s Chief Executive Officer and Chief Financial Officer as appropriate to allow timely decisions regarding required disclosure, are effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission (“SEC”).

There were no changes in our internal control over financial reporting that occurred during the most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

38

PART II - OTHER INFORMATION

Cautionary Statement for Purposes of “Safe Harbor Provisions” of the Private Securities Litigation Reform Act of 1995

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements include statements preceded by, followed by or that include the words “may,” “could,” “would,” “should,” “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “project,” “intend” and similar expressions. These statements include, among others, statements regarding our financial and operating results, strategic objectives and means to achieve those objectives, the amount and timing of capital expenditures, repurchases of its stock under approved stock repurchase plans, the amount and timing of interest expense, the likelihood of our success in expanding our business, financing plans, budgets, working capital needs and sources of liquidity.

Forward-looking statements are only predictions and are not guarantees of performance. These statements are based on management’s beliefs and assumptions, which in turn are based on currently available information. Important assumptions include, among others, those regarding demand for Company services, expansion of service offerings geographically or through new or expanded service lines, the timing and cost of planned capital expenditures, competitive conditions and general economic conditions. These assumptions could prove inaccurate. Forward-looking statements also involve known and unknown risks and uncertainties, which could cause actual results to differ materially from those contained in any forward-looking statement. Many of these factors are beyond our ability to control or predict. Such factors include the replacement of non-recurring event clean-up projects, a loss of a major customer, our ability to permit and contract for timely construction of new or expanded disposal cells, our ability to renew our operating permits or lease agreements with regulatory bodies, loss of key personnel, compliance with and changes to applicable laws, rules, or regulations, access to insurance, surety bonds and other financial assurances, a deterioration in our labor relations or labor disputes, our ability to perform under required contracts, failure to realize anticipated benefits and operational performance from acquired operations, including our acquisition of EQ Holdings, Inc. in June 2014, adverse economic or market conditions, government funding or competitive pressures, incidents or adverse weather conditions that could limit or suspend specific operations, access to cost effective transportation services, fluctuations in foreign currency markets, lawsuits, our willingness or ability to pay dividends, implementation of new technologies, limitations on our available cash flow as a result of our indebtedness and our ability to effectively execute our acquisition strategy and integrate future acquisitions.

Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the Securities and Exchange Commission (the “SEC”), we are under no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on our forward-looking statements. Although we believe that the expectations reflected in forward-looking statements are reasonable, we cannot guarantee future results or performance. Before you invest in our common stock, you should be aware that the occurrence of the events described in the “Risk Factors” section in this report could harm our business, prospects, operating results, and financial condition.

Investors should also be aware that while we do, from time to time, communicate with securities analysts, it is against our policy to disclose to them any material non-public information or other confidential commercial information. Accordingly, stockholders should not assume that we agree with any statement or report issued by any analyst irrespective of the content of the statement or report. Furthermore, we have a policy against issuing or confirming financial forecasts or projections issued by others. Thus, to the extent that reports issued by securities analysts contain any projections, forecasts or opinions, such reports are not the responsibility of US Ecology, Inc.

39

ITEM 1. LEGAL PROCEEDINGS

We are not currently a party to any material pending legal proceedings and are not aware of any other claims that could, individually or in the aggregate, have a materially adverse effect on our financial position, results of operations or cash flows.

ITEM 1A. RISK FACTORS

The Company is subject to various risks and uncertainties that could have a material impact on our business, financial condition, results of operations and cash flows. The discussion of these risk factors is included in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable.

40

ITEM 6. EXHIBITS

10.1	Stock Purchase Agreement, dated August 4, 2015, between EQ Industrial Services Inc., and ASPV Holdings, Inc.
15	Letter re: Unaudited Interim Financial Statements
31.1	Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	The following materials from the quarterly report on Form 10-Q of US Ecology, Inc. for the quarter ended September 30, 2015 formatted in Extensible Business Reporting Language (XBRL) include: (i) Unaudited Consolidated Balance Sheets, (ii) Unaudited Consolidated Statements of Operations, (iii) Unaudited Consolidated Statements of Comprehensive Income, (iv) Unaudited Consolidated Statements of Cash Flows, and (v) Notes to the Unaudited Consolidated Financial Statements

41

SIGNATURE

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.

	US Ecology, Inc.
	(Registrant)
Date: November 4, 2015	/s/ Eric L. Gerratt
	Eric L. Gerratt
	Executive Vice President, Chief Financial Officer and Treasurer

42

EX-10.1

Exhibit 10.1

EXECUTION COPY

STOCK PURCHASE AGREEMENT

between

EQ INDUSTRIAL SERVICES, INC.

and

ASPV HOLDINGS, INC.

DATED AS OF AUGUST 4, 2015

TABLE OF CONTENTS

		Page
ARTICLE I           PURCHASE AND SALE OF THE SHARES		1
SECTION 1.01	Purchase and Sale of the Shares	1
ARTICLE II         CLOSING; WORKING CAPITAL ADJUSTMENT		1
SECTION 2.01	Closing	1
SECTION 2.02	Working Capital Adjustment	2
ARTICLE III       CONDITIONS TO CLOSING		5
SECTION 3.01	Buyer’s Obligation	5
SECTION 3.02	Seller’s Obligation	6
SECTION 3.03	Satisfaction of Closing Conditions	7
SECTION 3.04	Frustration of Closing Conditions	8
ARTICLE IV        REPRESENTATIONS AND WARRANTIES OF SELLER		8
SECTION 4.01	Authority	8
SECTION 4.02	No Conflicts; Consents	9
SECTION 4.03	The Shares	9
SECTION 4.04	Organization and Standing; Books and Records	10
SECTION 4.05	Capital Stock of the Company	10
SECTION 4.06	Company Subsidiaries; Equity Interests	10
SECTION 4.07	Financial Statements	11
SECTION 4.08	Undisclosed Liabilities	12
SECTION 4.09	Taxes	12
SECTION 4.10	Assets Other than Real Property Interests	14
SECTION 4.11	Real Property	14
SECTION 4.12	Intellectual Property	15
SECTION 4.13	Material Contracts	16
SECTION 4.14	Litigation	18
SECTION 4.15	Benefit Plans	19
SECTION 4.16	Absence of Changes or Events	21
SECTION 4.17	Compliance with Applicable Laws	21
SECTION 4.18	Employee and Labor Matters	22
SECTION 4.19	Environmental Matters	22
SECTION 4.20	Broker’s Fees	24
SECTION 4.21	Affiliated Transactions	24
SECTION 4.22	Insurance	25

i

TABLE OF CONTENTS

(continued)

		Page
SECTION 4.23	Customers and Suppliers	25
ARTICLE V         COVENANTS OF SELLER		26
SECTION 5.01	Access	26
SECTION 5.02	Ordinary Conduct	26
SECTION 5.03	Assignment of ASPV Acquisition Documents	29
SECTION 5.04	Exclusive Dealing	29
SECTION 5.05	Seller Assistance with Financing	29
SECTION 5.06	Confidentiality	30
ARTICLE VI        REPRESENTATIONS AND WARRANTIES OF BUYER		30
SECTION 6.01	Authority	30
SECTION 6.02	No Conflicts: Consents	31
SECTION 6.03	Securities Act	31
SECTION 6.04	Actions and Proceedings, etc.	31
SECTION 6.05	Financing	31
SECTION 6.06	Guaranty	33
SECTION 6.07	Solvency	33
ARTICLE VII      COVENANTS OF BUYER		33
SECTION 7.01	Confidentiality	33
SECTION 7.02	No Additional Representations	34
SECTION 7.03	No Use of Certain Names	35
SECTION 7.04	Buyer Activity on Closing Date	35
ARTICLE VIII    MUTUAL COVENANTS		35
SECTION 8.01	Consents	35
SECTION 8.02	Cooperation	36
SECTION 8.03	Publicity	36
SECTION 8.04	Reasonable Best Efforts	36
SECTION 8.05	Records	37
SECTION 8.06	Financing	37
SECTION 8.07	Employee Matters	39
SECTION 8.08	Release	40
SECTION 8.09	Transition Services	41
SECTION 8.10	Fixed Pricing for Certain Services; Disposal Services	43

ii

TABLE OF CONTENTS

(continued)

		Page
ARTICLE VIII    MUTUAL COVENANTS		44
ARTICLE X         FURTHER ASSURANCES		44
SECTION 10.01	Further Assurances	44
ARTICLE XI        ENVIRONMENTAL MATTERS		44
SECTION 11.01	ISRA and Environmental Matters	44
ARTICLE XII      TAX MATTERS		46
SECTION 12.01	Tax Returns	46
SECTION 12.02	Cooperation	46
SECTION 12.03	Refunds and Credits	46
SECTION 12.04	Transfer Taxes	46
SECTION 12.05	FIRPTA Certificate	47
SECTION 12.06	Buyer Activity Post-Closing	47
ARTICLE XIII    TERMINATION		47
SECTION 13.01	Termination	47
SECTION 13.02	Return of Confidential Information	48
SECTION 13.03	Consequences of Termination	48
ARTICLE XIV     NON-SURVIVAL OF REPRESENTATIONS		48
SECTION 14.01	Non-Survival of Representations	48
ARTICLE XV      MISCELLANEOUS		48
SECTION 15.01	Assignment	48
SECTION 15.02	No Third Party Beneficiaries	49
SECTION 15.03	Fees and Expenses	49
SECTION 15.04	Specific Performance	49
SECTION 15.05	Amendments	50
SECTION 15.06	Notices	50
SECTION 15.07	Interpretation; Exhibits and the Seller Disclosure Schedule; Definitions	51
SECTION 15.08	Counterparts	60
SECTION 15.09	Entire Agreement	60
SECTION 15.10	Brokers	60
SECTION 15.11	Severability	60
SECTION 15.12	Consent to Jurisdiction	60
SECTION 15.13	Waiver of Jury Trial	61

iii

TABLE OF CONTENTS

(continued)

		Page
SECTION 15.14	GOVERNING LAW	61
SECTION 15.15	Non-Recourse	61

iv

Schedules, Exhibits and Annexes

Annex I	Equity Commitment Letter
Annex II	Limited Guaranty
Annex III	Working Capital Accounts

v

STOCK PURCHASE AGREEMENT

STOCK PURCHASE AGREEMENT, dated as of August 4, 2015 (this “Agreement”), between EQ INDUSTRIAL SERVICES, INC., a Michigan corporation (“Seller”), and ASPV Holdings, Inc., a Delaware corporation (“Buyer”).  All capitalized terms used in this Agreement shall have the respective meanings assigned to such terms in Section 15.07.

WHEREAS, Buyer desires to purchase from Seller, and Seller desires to sell to Buyer, all of the issued and outstanding capital stock of Allstate Power Vac, Inc., a New York corporation and wholly owned subsidiary of Seller (the “Company”), consisting of 1,000 shares of Common Stock, no par value (the “Shares”).

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

ARTICLE I

Purchase and Sale of the Shares

SECTION 1.01Purchase and Sale of the Shares.  On the terms and subject to the conditions of this Agreement, Seller will sell, transfer, assign, convey and deliver (or cause to be sold, assigned, transferred, conveyed and delivered) to Buyer, and Buyer will purchase from Seller, the Shares, free and clear of all Liens, for an aggregate purchase price equal to $58,000,000.00 (the “Purchase Price”), payable and subject to adjustment as set forth in Article II.

ARTICLE II

Closing; Working Capital Adjustment

SECTION 2.01Closing.  (a) Subject to the terms and conditions of this Agreement, the sale and purchase contemplated by this Agreement shall take place at a closing (the “Closing”) to be held at 10:00 a.m., Boise, Idaho time, on the first day of the calendar month after the satisfaction or waiver (subject to Applicable Law) of the conditions set forth in Article III (excluding conditions that, by their terms, are to be satisfied at Closing but subject to the satisfaction or waiver of such conditions), which shall take place remotely via the exchange of facsimile or scanned final instruments and executed signature pages, or at such other time or on such other date or at such other place as Seller and Buyer may mutually agree upon in writing.  The day on which the Closing takes place is referred to herein as the “Closing Date” and the Closing shall be deemed effective as of 12:01 a.m., Boise, Idaho time, on the Closing Date (the “Effective Time”).

(b)No later than three (3) business days prior to the Closing Date, Seller shall prepare and deliver to Buyer a statement certified as to its truth and accuracy by an executive officer of Seller, setting forth, in reasonable detail, Seller’s good faith determinations and calculations of (i) the WC Amount (which shall be the amount determined by the Accounting

1

Firm), (ii) the Estimated Working Capital, (iii) an estimate of the CapEx Adjustment (the “Estimated CapEx Adjustment”), (iv) an estimate of the Closing Cash (the “Estimated Closing Cash”) (which can be a negative number), (v) an estimate of the Closing Indebtedness (the “Estimated Closing Indebtedness”), (vi) the Transaction Expenses (the “Estimated Transaction Expenses”) and (vii) based on the amounts in clauses (i)-(vi), the Closing Date Amount, in each case, delivered with reasonable supporting detail with respect to the determination and calculation of such amounts, along with a certificate of Seller stating that the statement has been prepared in compliance with the requirements of this Section 2.01, including all definitions; provided, that in the event that Buyer notifies Seller prior to the Closing that it disputes Seller’s determination or calculation of the Closing Date Amount or any component thereof (other than the WC Amount, which shall be determined by the Accounting Firm), then Buyer and Seller shall cooperate in good faith to resolve any such dispute as promptly as practicable, and modify the Closing Date Amount and the components thereof (other than the WC Amount, which shall be determined by the Accounting Firm) as appropriate to reflect any agreed adjustments thereto, and the terms defined in this sentence shall be deemed to reflect any such agreed modifications; provided, further, that to the extent Buyer and Seller are unable to resolve any such disputes, such disputes shall in no event delay the Closing or the Closing Date and Seller’s calculation of Closing Date Amount and the components thereof (other than the WC Amount, which shall be determined by the Accounting Firm) shall not be modified and Buyer and Seller shall proceed to Closing on the basis of such calculation (as modified to reflect any agreed adjustments).  Notwithstanding anything in this Agreement to the contrary, if as of Closing Buyer does not have sufficient funds to pay to Seller an amount in excess of the Purchase Price resulting from any adjustment to the Purchase Price pursuant to this Section 2.01(b), the failure of Buyer to have such sufficient funds in excess of the Purchase Price shall not delay the Closing and Buyer shall remain responsible for the payment to Seller of such funds in excess of the Purchase Price, subject to any adjustment pursuant to Section 2.02.

(c)At the Closing:  (a) Buyer shall (i) deliver to Seller, by wire transfer of immediately available funds to a bank account designated in writing by Seller at least two (2) business days prior to the Closing Date (or if the Closing occurs on a day that is not a business day, then by certified bank check or transfer of an escrow account or bank account), immediately available funds in an amount equal to the Closing Date Amount and (ii) pay the Estimated Transaction Expenses to the obligees thereof by wire transfer of immediately available funds in accordance with invoices or other documents evidencing such amounts which Seller shall deliver to Buyer at least three (3) business days prior to the Closing Date; provided, that if the Closing occurs on a day that is not a business day, then Buyer will pay the Estimated Transaction Expenses on the next business day following the Closing Date; and (b) Seller shall deliver or cause to be delivered to Buyer certificates representing the Shares, duly endorsed in blank or accompanied by stock powers duly endorsed in blank in proper form for transfer, with appropriate transfer stamps, if any, affixed.

SECTION 2.02Working Capital Adjustment.  (a) (i) Within sixty (60) days after the Closing Date, Seller shall prepare and deliver to Buyer a statement (the “Statement”), certified as to its truth and accuracy by an executive officer of Seller, setting forth, in reasonable detail, (A) a determination and calculation of the WC Amount, which shall be determined by the Accounting Firm, (B) Working Capital as of the Effective Time (“Closing Working Capital”), (C) the CapEx Adjustment, (D) the Cash as of the Effective Time (“Closing Cash”) (which can

2

be a negative number), (E) the Indebtedness as of the Effective Time (“Closing Indebtedness”) and (F) the Transactions Expenses as of the Effective Time (“Closing Transaction Expenses”), along with a certificate of Seller stating that the Statement has been prepared in compliance with the requirements of this Section 2.02, including all definitions.

(ii)The Statement shall become final and binding upon the parties on the sixtieth (60th) day following delivery thereof, unless Buyer gives written notice of its disagreement with the Statement (“Notice of Disagreement”) to Seller prior to such date.  Any Notice of Disagreement shall specify in reasonable detail the item and amount of any disagreement so asserted.  If a Notice of Disagreement is received by Seller, then the Statement (as revised in accordance with clause (1) or (2) below) shall become final and binding upon Seller and Buyer on the earlier of (1) the date Seller and Buyer resolve in writing any differences they have with respect to the matters specified in the Notice of Disagreement and (2) the date any disputed matters are finally resolved in writing by the Accounting Firm.  For the avoidance of doubt, Buyer may not include in the Notice of Disagreement a disagreement with respect to the Accounting Firm’s determination and/or calculation of the WC Amount.

(iii)During the sixty (60) day period following the delivery of a Notice of Disagreement, Seller and Buyer shall seek in good faith to resolve in writing any differences which they may have with respect to the matters specified in the Notice of Disagreement.  At the end of such sixty (60) day period, Seller and Buyer shall submit to the Dispute Resolution team of the Detroit, Michigan office of Plante & Moran, PLLC, or if such firm refuses to take the engagement, a nationally recognized independent accounting firm mutually agreed upon by Seller and Buyer (the “Accounting Firm”) for review and resolution of any and all matters which remain in dispute and which were included in the Notice of Disagreement.  Seller and Buyer shall use commercially reasonable efforts to cause the Accounting Firm to render a decision resolving the matters submitted to the Accounting Firm within thirty (30) days of the receipt of such submission.  Seller and Buyer agree that judgment may be entered upon the final written determination of the Accounting Firm in any court having jurisdiction over the party against which such determination is to be enforced.  The Accounting Firm’s determination shall be accompanied by a certificate of the Accounting Firm that it reached its decision in accordance with the provisions of this Section 2.02, including all applicable definitions.  The fees and expenses of the Accounting Firm pursuant to this Section 2.02(a) shall be borne by Buyer and Seller in inverse proportion as they may prevail on matters resolved by the Accounting Firm, which proportionate allocation also shall be determined by the Accounting Firm at the time the determination of the Accounting Firm is rendered on the merits of the matter submitted.  In calculating the Closing Working Capital, CapEx Adjustment, Closing Cash, Closing Transaction Expenses or Closing Indebtedness, the Accounting Firm (i) shall be limited to addressing any particular disputes referred to in the Notice of Disagreement and (ii) such calculation shall, with respect to any disputed item, be no greater than the higher amount calculated by Seller or Buyer, and no less than the lower amount calculated by Seller or Buyer, as the case may be.

(b)The Purchase Price shall be (i) increased or decreased (as applicable) by the amount by which Closing Working Capital (as finally determined pursuant to Section 2.02(a)) is greater than or less than the WC Amount (as finally determined pursuant to Section 2.02(a)),  (ii) increased by the amount of the CapEx Adjustment (as finally determined pursuant to Section 2.02(a)), (iii) increased or decreased (as applicable) by the amount of the Closing Cash

3

(as finally determined pursuant to Section 2.02(a)), (iv) increased or decreased (as applicable) by the amount of the Closing Transaction Expenses (as finally determined pursuant to Section 2.02(a)) and (v) decreased by the amount of the Closing Indebtedness (as finally determined pursuant to Section 2.02(a)) (the Purchase Price as so increased or decreased shall hereinafter be referred to as the “Adjusted Purchase Price”).  If the Closing Date Amount is less than the Adjusted Purchase Price, Buyer shall, and if the Closing Date Amount is more than the Adjusted Purchase Price, Seller shall, within ten (10) business days after the Statement becomes final and binding on the parties in accordance with Section 2.02(a), make payment to the other party by wire transfer of immediately available funds of the amount of such difference, together with interest thereon at the Prime Rate.  The “WC Amount” means an amount equal to the arithmetic mean of the values for Working Capital as of the close of each of the consecutive 12 fiscal months of the Company ending with the last complete fiscal month of the Company immediately prior to the fiscal month immediately preceding the month in which the Closing occurs (for purposes of clarity, if the Closing occurs on October 1, 2015, then the latest fiscal month included in the calculation of the WC Amount would be August 2015), which shall be determined and calculated by the Accounting Firm in accordance with the Seller Accounting Policies at least five (5) business days prior to the Closing Date and which such determination and calculation of the WC Amount by the Accounting Firm shall be final and binding on the parties hereto.  No later than ten (10) business days prior to the Closing Date, Seller shall submit a request to the Accounting Firm to determine and calculate the WC Amount in accordance with the immediately preceding sentence.  Any adjustment of the Purchase Price pursuant to this Section 2.02 shall be referred to as the “Working Capital Adjustment”.

(c)The term “Working Capital” shall mean, with respect to the Company and the Company Subsidiaries, as of any time of determination, those current assets of the Company and the Company Subsidiaries, on a consolidated basis, that are included in the line item categories of current assets specifically identified on Annex III, less those current liabilities of the Company and the Company Subsidiaries, on a consolidated basis, that are included in the line item categories of current liabilities specifically identified on Annex III, in each case, without duplication, and as determined in a manner strictly consistent with the Seller Accounting Policies and without giving effect to the transactions contemplated by this Agreement.  Current assets and current liabilities relating to income Taxes shall not be taken into account in determining Working Capital.  Cash shall not be taken into account in determining Working Capital.  The parties agree that the WC Amount and the Closing Working Capital shall be calculated using the same Seller Accounting Policies.  The term “Working Capital Accounts” shall mean the line items of the Working Capital set forth on Annex III.

(d)During the period of time from and after the Closing Date through the resolution of any Working Capital Adjustment contemplated by this Section 2.02, Buyer agrees that it shall not take any actions with respect to the accounting books and records of the Company relating to the periods prior to the Effective Time on which the Statement is to be based that results in changes to the calculations of the amounts to be set forth in the Statement, including the Closing Working Capital, the CapEx Adjustment, the Closing Cash and the Closing Indebtedness, or in any reserve or other account existing in such books and records.

(e)During the period of time from and after the Closing Date through the resolution of any Working Capital Adjustment contemplated by this Section 2.02, (i) Buyer shall promptly

4

cause the Company to afford to Seller and any accountants, counsel or financial advisers retained by Seller in connection with any Working Capital Adjustment contemplated by this Section 2.02 (including the Accounting Firm) reasonable access during normal business hours to all the Company’s and the Company Subsidiaries’ properties, books, contracts, personnel and records relevant to the adjustment contemplated by this Section 2.02 and shall provide Seller upon Seller’s request and at Seller’s expense with copies of any such books, Contracts and records, including Buyer’s work papers relating to any Notice of Disagreement and (ii) Seller shall promptly afford to Buyer and any accountants, counsel or financial advisers retained by Buyer in connection with any Working Capital Adjustment contemplated by this Section 2.02 (including the Accounting Firm) reasonable access during normal business hours to all of the Seller’s or its Affiliates’ properties, books, contracts, personnel and records relevant to the adjustment contemplated by this Section 2.02 and shall provide Buyer upon Buyer’s request and at Buyer’s expense with copies of any such books, contracts and records, including Seller’s work papers relating to the Statement and calculation of the WC Amount and the Closing Date Amount; provided, that (x) as a condition precedent to any such access to Seller pursuant to the preceding clause (i), Seller and its applicable Affiliates shall execute a non-disclosure agreement containing customary non-disclosure and non-use provisions with respect to all information to be disclosed pursuant to the preceding clause (i) and (y) all such access to Buyer pursuant to the preceding clause (ii) shall be subject to the terms of the Confidentiality Agreement and to Section 7.01 hereof.  Notwithstanding anything in this Agreement to the contrary, if any Restricted Cash that is not taken into account in determining the Adjusted Purchase Price (as finally determined pursuant to Section 2.02) is identified in writing prior to the date that is sixty (60) days after the Closing Date, such Restricted Cash will be paid to Seller promptly after the lapse of any restrictions on such Restricted Cash but only if such restrictions lapse and such Restricted Cash is available within two years of the Closing Date.

ARTICLE III

Conditions to Closing

SECTION 3.01Buyer’s Obligation.  The obligation of Buyer to purchase and pay for the Shares is subject to the satisfaction (or waiver by Buyer) as of the Closing of the following conditions:

(a)The representations and warranties of Seller (i) made in Sections 4.01, 4.03, 4.04 (the first sentence only), 4.05, 4.06(a), 4.06(b), 4.06(c) (the first sentence only), 4.06(d) and 4.20 of this Agreement shall be true and correct in all but de minimis respects, as of the date hereof and as of the time of the Closing as though made as of such time (except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct in all but de minimis respects on and as of such earlier date), and (ii) made in this Agreement, other than those described in clause (i) above, shall be true and correct (disregarding all materiality and Material Adverse Effect qualifications contained therein), as of the date hereof and as of the time of the Closing as though made as of such time (except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects on and as of such earlier date), except in the case of this clause (ii) where the failure to be so true and correct, individually or in the aggregate, has not had, and

5

would not reasonably be expected to have, a Material Adverse Effect.  Seller shall have performed or complied in all material respects with all obligations and covenants required by this Agreement to be performed or complied with by Seller by the time of the Closing.  Seller shall have delivered to Buyer a certificate dated the Closing Date and signed by an authorized officer of Seller confirming that the condition in this Section 3.01(a) has been satisfied.

(b)No (i) statute, rule, regulation, executive order, decree or other legal restraint or prohibition shall be enacted, entered, promulgated, enforced or issued by any Governmental Entity and be in effect and (ii) temporary restraining order or preliminary or permanent injunction issued by any Governmental Entity in the United States shall be pending, issued or enforced and be in effect, in any case set forth in clauses (i) or (ii) above, that prevents the purchase and sale of the Shares.

(c)Seller and its Affiliates shall have executed and delivered the other Transaction Documents to which it or they are a party.

(d)The ASPV Acquisition Documents shall have been assigned pursuant to Section 5.03.

(e)The Company shall have filed (i) an ISRA General Information Notice with the NJDEP for the Rahway Site, and (ii) a Remediation Certification for the Rahway Site, and posted a Remediation Funding Source with any applicable Annual Surcharge Payment, consistent with Section 11.01.

(f)The Pre-Closing Transfers shall have been completed.

(g)Since the date hereof, there shall have been no Material Adverse Effect.

(h)All approvals or consents by Governmental Entities that are set forth on Schedule 3.01(h) shall have been obtained.  Approvals under the Solid Waste Utility Control Act and the Solid Waste Management Act to consummate the transactions and all transfers contemplated by this Agreement shall have been obtained.  Approvals required by NJDEP necessary to own and operate the business of the Company shall have been obtained, and the parties shall have complied with any statutory and regulatory requirements imposed or administered by any of those Governmental Entities to the extent such compliance is required as a material condition to the effectiveness of such approvals and consents.

(i)Seller shall have delivered to Buyer evidence of termination of any Liens securing any Indebtedness of the Company or any Company Subsidiary or any other filed Liens against the Company or any Company Subsidiary or any asset of the Company or any Company Subsidiary (other than (A) any filed Liens related to operating leases and (B) any filed Liens securing amounts less than $50,000 in the aggregate).

SECTION 3.02Seller’s Obligation.  The obligation of Seller to sell and deliver the Shares to Buyer is subject to the satisfaction (or waiver by Seller) as of the Closing of the following conditions:

6

(a)The representations and warranties of Buyer (i) made in Sections 6.01, 6.05, 6.06 and 6.07 of this Agreement shall be true and correct in all but de minimis respects, as of the date hereof and as of the time of the Closing as though made as of such time (except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct in all but de minimis respects on and as of such earlier date), and (ii) made in this Agreement, other than those described in clause (i) above, shall be true and correct (disregarding all materiality and Material Adverse Effect qualifications contained therein), as of the date hereof and as of the time of the Closing as though made as of such time (except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects on and as of such earlier date), except in the case of this clause (ii) where the failure to be so true and correct, individually or in the aggregate, has not had, and would not reasonably be expected to have, a material adverse effect on, or materially delay, Buyer’s ability to consummate the purchase and sale of the Shares and the other transactions contemplated by this Agreement on the terms and conditions set forth herein.  Buyer shall have performed or complied in all material respects with all obligations and covenants required by this Agreement to be performed or complied with by Buyer by the time of the Closing.  Buyer shall have delivered to Seller a certificate dated the Closing Date and signed by an authorized officer of Buyer confirming the foregoing.

(b)No (i) statute, rule, regulation, executive order, decree or other legal restraint or prohibition shall be enacted, entered, promulgated, enforced or issued by any Governmental Entity and be in effect and (ii) temporary restraining order or preliminary or permanent injunction issued by any Governmental Entity in the United States shall be pending, issued or enforced and be in effect, in any case set forth in clauses (i) or (ii) above, that prevents or seeks to prevent the purchase and sale of the Shares.

(c)Buyer shall have executed and delivered the other Transaction Documents to which it is party.

(d)All submissions required under ISRA to consummate the transactions and all transfers contemplated by this Agreement shall have been made.

(e)All approvals or consents by Governmental Entities that are set forth on Schedule 3.01(h) shall have been obtained.  Approvals under the Solid Waste Utility Control Act and the Solid Waste Management Act to consummate the transactions and all transfers contemplated by this Agreement shall have been obtained.  Approvals required by NJDEP necessary to own and operate the business of the Company shall have been obtained, and the parties shall have complied with any statutory and regulatory requirements imposed or administered by any of those Governmental Entities to the extent such compliance is required as a material condition to the effectiveness of such approvals and consents.

(f)The Pre-Closing Transfers shall have been completed.

SECTION 3.03Satisfaction of Closing Conditions.  The parties acknowledge and agree that if Buyer or Seller has knowledge of: (a) a failure of any condition set forth in Section 3.01 or 3.02, respectively, or of any breach by the other party of any representation, warranty,

7

obligation or covenant contained in this Agreement, and such party proceeds with the Closing, then, such party shall be deemed to have waived such failure or breach and may not assert such failure or breach as a basis for termination under Section 13.01; or (b) the breach of a representation or warranty of the other party as of the date of this Agreement, then such party shall not be entitled or permitted to assert such breach as the basis for the failure of a closing condition set forth in Section 3.01 or 3.02, respectively, or to assert such breach as a basis for termination pursuant to Section 13.01; and, in each of clause (a) and/or (b), such party and its successors, assigns and Affiliates shall not be entitled to sue for damages or to assert any other right or remedy for any losses arising from any matters relating to such condition or breach, notwithstanding anything to the contrary contained herein or in any certificate delivered pursuant hereto.

SECTION 3.04Frustration of Closing Conditions.  Neither Buyer nor Seller may rely on the failure of any condition set forth in Section 3.01 or 3.02, respectively, to be satisfied, and may not assert such failure of a condition as a basis for termination pursuant to Section 13.01, in each case (a) if such failure was caused by such party’s failure to act in good faith or to use its reasonable best efforts to cause the Closing to occur, as required by Section 8.04, or (b) if such failure was primarily or proximately caused by the action or inaction of such party, or any Affiliate or representative of such party, or any other person acting or not acting at the instruction of such party, or any Affiliate or representative of such party.  For purposes of this Section 3.04, references to “Buyer” shall be deemed to include Mr. Lou Galasso III; provided, however, that references to “Buyer” shall not be deemed to include Mr. Lou Galasso III for any purpose with respect to (i) any failure by Mr. Lou Galasso III to act in good faith or to use reasonable best efforts to cause the Closing to occur or (ii) any action or inaction of Mr. Lou Galasso III, in any case with respect to clauses (i) and (ii) immediately above, where Mr. Lou Galasso III was acting (or failing to act) at the direction of US Ecology, Inc., any of its Affiliates or any of its or their respective representatives.

ARTICLE IV

Representations and Warranties of Seller

Except as set forth in the Seller Disclosure Schedule delivered to Buyer concurrent with the execution and delivery of this Agreement (it being understood that any information set forth in one section or subsection of the Seller Disclosure Schedule shall be deemed to apply to and qualify the Section or subsection of this Agreement to which it corresponds and each other Section or subsection of this Agreement to the extent that it is reasonably apparent that such information is relevant to such other Section or subsection) (the “Seller Disclosure Schedule”), Seller hereby represents and warrants to Buyer as follows:

SECTION 4.01Authority.  Seller is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation.  Seller has all requisite corporate power and authority to enter into this Agreement and the other Transaction Documents, and to perform its obligations hereunder and thereunder.  Seller has all requisite corporate power to consummate the transactions contemplated hereby and thereby.  All corporate acts and other proceedings required to be taken by Seller to authorize the execution, delivery and performance of this Agreement and the other Transaction Documents and the consummation of

8

the transactions contemplated hereby and thereby have been duly and properly taken.  This Agreement has been duly executed and delivered by Seller and constitutes, and the other Transaction Documents on the Closing Date will be duly executed and delivered by Seller and will constitute, a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws affecting creditors’ rights generally from time to time in effect and to general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law (the “Bankruptcy and Equity Exception”).

SECTION 4.02No Conflicts; Consents.  (a) The execution and delivery of this Agreement by Seller does not, and the execution and delivery of the other Transaction Documents by Seller will not, and the consummation of the transactions contemplated hereby and thereby and compliance with the terms hereof and thereof will not (with or without notice or lapse of time, or both), conflict with, or result in any violation of or default under, or give rise to a right of termination, cancellation or acceleration of any obligation or to loss of a material benefit under, or result in the creation of any liens, claims, encumbrances, security interests, options, pledges, mortgages, deeds of trust, rights of first refusal, easements, charges or restrictions of any kind (“Liens”) upon any of the properties or assets of the Company or any Company Subsidiary or the Shares or equity interests of any Company Subsidiary under, any provision of (i) the Certificate of Incorporation or Bylaws (or the comparable governing instruments) of Seller, the Company or any Company Subsidiary, (ii) any judgment, order or decree, or, subject to the matters referred to in clauses (i), (ii) and (iii) of paragraph (b) below, any Applicable Law to which Seller, the Company, any Company Subsidiary or their respective properties or assets is subject, (iii) any Material Contract, (iv) any Permit or (v) any Environmental Permit.

(b)No consent, approval, license, permit, order or authorization of, written notice to, or registration, declaration or filing with, any United States or foreign federal, state or local government or any court, tribunal or administrative agency or commission or other governmental body, authority or instrumentality of any kind (a “Governmental Entity”) is required to be obtained or made by or with respect to Seller, the Company or any Company Subsidiary in connection with the execution, delivery and performance of this Agreement or the other Transaction Documents or the consummation of the transactions contemplated hereby or thereby other than (i) those that may be required solely by reason of Buyer’s (as opposed to any other third party’s) participation in the transactions contemplated hereby (which are set forth on Section 4.02(b) of the Seller Disclosure Schedule), (ii) those Environmental Permits that are set forth on Section 4.02(b) of the Seller Disclosure Schedule and (iii) other than with respect to Environmental Permits, such consents, approvals, licenses, permits, orders, authorizations, registrations, declarations and filings, the absence of which, or the failure to make which, individually or in the aggregate, would not reasonably be expected to be material to the Company and the Company Subsidiaries, taken as a whole.

SECTION 4.03The Shares.  Seller has good and valid title to the Shares capable of being conveyed to Buyer, free and clear of any Liens.  Assuming Buyer has the requisite power and authority to be the lawful owner of the Shares, upon delivery to Buyer at the Closing of certificates representing the Shares, duly endorsed by Seller for transfer to Buyer in accordance with Section 2.01, and upon Seller’s receipt of the Closing Date Amount in accordance with

9

Section 2.01, good and valid title to the Shares capable of being conveyed to Buyer will pass to Buyer, free and clear of any Liens, other than those arising from acts of Buyer or its Affiliates.  Other than this Agreement, the Shares are not subject to any voting trust agreement or other contract, agreement or commitment, including any such contract, agreement or commitment restricting or otherwise relating to the voting, dividend rights or disposition of the Shares.

SECTION 4.04Organization and Standing; Books and Records.  The Company is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation.  The Company has full corporate power and authority and possesses all governmental franchises, licenses, permits, authorizations and approvals necessary to enable it to own, lease or otherwise hold its properties and assets and to carry on its business as presently conducted, other than such franchises, licenses, permits, authorizations and approvals the lack of which, individually or in the aggregate, would not reasonably be expected to be material to the Company and the Company Subsidiaries.  The Company is duly qualified and in good standing to do business as a foreign corporation in each jurisdiction in which the conduct or nature of its business or the ownership, leasing or holding of its properties makes such qualification necessary, except such jurisdictions where the failure to be so qualified or in good standing, individually or in the aggregate, would not be reasonably likely to have a Material Adverse Effect.  Seller has prior to the execution of this Agreement made available to Buyer true and complete copies of the Certificate of Incorporation and Bylaws, each as amended to the date hereof, of the Company.

SECTION 4.05Capital Stock of the Company.  The authorized capital stock of the Company consists of sixty thousand (60,000) shares of common stock, no par value, of which one thousand (1,000) shares, constituting the Shares, are duly authorized and validly issued and outstanding, fully paid and nonassessable, and are being offered, sold and delivered pursuant to this Agreement in compliance with all Applicable Law (assuming the representations and warranties set forth in Section 6.03 are true and correct).  Seller is the sole and exclusive record and beneficial owner of the Shares.  Except for the Shares, there are no shares of capital stock or other equity securities of the Company outstanding.  The Shares have not been issued in violation of, and are not subject to, any right of first refusal, preemptive, subscription or similar rights under any provision of Applicable Law, the Certificate of Incorporation or Bylaws of the Company, any contract, agreement or instrument to which the Shares are subject or Seller, the Company or any Company Subsidiary is subject, bound or a party or otherwise.  There are no outstanding warrants, options, rights, “phantom” stock rights, agreements, convertible or exchangeable securities or other commitments (other than this Agreement) (a) pursuant to which Seller or the Company is or may become obligated to issue, sell, purchase, return or redeem any shares of capital stock or other securities of the Company or (b) that give any person the right to receive any benefits or rights similar to any rights enjoyed by or accruing to the holders of shares of capital stock of the Company.  There are no outstanding bonds, debentures, notes or other Indebtedness having the right to vote on any matters on which stockholders of the Company may vote.

SECTION 4.06Company Subsidiaries; Equity Interests.  (a) Section 4.06(a) of the Seller Disclosure Schedule sets forth all direct and indirect subsidiaries of the Company (each a “Company Subsidiary”), listing each Company Subsidiary’s name, type of entity, jurisdiction, authorized capital stock, membership interests or equivalent, the number and type of its issued

10

and outstanding shares of capital stock, membership units or similar ownership interests, and the current ownership of such shares, membership units or similar ownership interests.

(b)Except for the Company Subsidiaries, there are no other corporations, limited liability companies, partnerships, joint ventures, associations or other entities or persons in which the Company or any Company Subsidiary owns, of record or beneficially, any direct or indirect equity or other interest or any right (contingent or otherwise) to acquire the same.

(c)Each Company Subsidiary is duly formed, validly existing and in good standing under the laws of its jurisdiction of incorporation or formation.  Each Company Subsidiary has full organizational power and authority and possesses all governmental franchises, licenses, permits, authorizations and approvals necessary to enable it to own, lease or otherwise hold its properties and assets and to carry on its business as presently conducted, other than such franchises, licenses, permits, authorizations and approvals the lack of which, individually or in the aggregate, would not be reasonable be expected to be material to the Company and the Company Subsidiaries.  Each Company Subsidiary is duly qualified and in good standing to do business as a foreign corporation or other organization in each jurisdiction in which the conduct or nature of its business or the ownership, leasing or holding of its properties makes such qualification necessary, except such jurisdictions where the failure to be so qualified or in good standing, individually or in the aggregate, would not be reasonably likely to have a Material Adverse Effect.  Seller has prior to the execution of this Agreement made available to Buyer true and complete copies of the organizational documents, each as amended to the date hereof, of each of the Company Subsidiaries.

(d)All of the issued and outstanding equity securities of each Company Subsidiary have been duly authorized and validly issued, and are fully paid and nonassessable.  The Company or one or more of the Company Subsidiaries is or are the sole and exclusive record and beneficial owner(s) of all of the outstanding equity securities of each Company Subsidiary.  The outstanding equity securities of each Company Subsidiary have not been issued in violation of, and are not subject to, any right of first refusal, preemptive, subscription or similar rights under any provision of Applicable Law, the organizational documents of such Company Subsidiary, or any contract, agreement or instrument to which the equity interests of any Company Subsidiary or to which Seller, the Company or such Company Subsidiary is subject, bound or otherwise a party.  With respect to each Company Subsidiary, there are no outstanding warrants, options, rights, “phantom” stock rights, agreements, convertible or exchangeable securities or other commitments (i) pursuant to which Seller, the Company or any Company Subsidiary is or may become obligated to issue, sell, purchase, return or redeem any shares of capital stock or other securities of such Company Subsidiary or (ii) that give any person the right to receive any benefits or rights similar to any rights enjoyed by or accruing to the holders of shares of capital stock or other securities of such Company Subsidiary.

SECTION 4.07Financial Statements.  Section 4.07 of the Seller Disclosure Schedule sets forth (i) the preliminary estimate of the unaudited consolidated statement of net assets of the Company and the Company Subsidiaries as of December 31, 2014, and the unaudited consolidated income statement as of December 31, 2014, and (ii) preliminary estimate of the unaudited consolidated statement of net assets of the Company and the Company Subsidiaries as of March 31, 2015 (the “Balance Sheet”), and the unaudited consolidated income

11

statement for the three month period ended March 31, 2015 (clauses (i) and (ii) collectively, the “Financial Statements”).  The Financial Statements have been prepared in conformity with the Seller Accounting Policies consistently applied, and do not include allocations for corporate overhead or other costs or inter-company revenue items, and taking into account all of the foregoing qualifications, on that basis fairly present in all material respects the consolidated financial condition and results of operations of the Company and the Company Subsidiaries as of the respective dates thereof and for the respective periods indicated.

SECTION 4.08Undisclosed Liabilities.  Except for matters reflected or reserved against in the Financial Statements, neither the Company nor any of the Company Subsidiaries has any liability or obligation (whether known, unknown, asserted, unasserted, absolute, accrued, unacccrued, contingent, fixed, liquidated, unliquidated, due, to become due or otherwise) of any nature that would be required under GAAP, as in effect on the date of this Agreement, to be reflected on a consolidated balance sheet of the Company and the Company Subsidiaries (including the notes thereto), except liabilities that (A) were incurred since the date of the Balance Sheet in the ordinary course of business consistent with past practices (for purposes of clause (A), none of which is a material liability resulting from breach of contract, breach of warranty, violation of Applicable Law or an environmental liability or clean-up obligation), (B) are incurred in connection with the transactions contemplated by this Agreement or (C) would not, individually or in the aggregate, reasonably be expected to be material to the Company and the Company Subsidiaries, taken as a whole.  As of the date hereof, the Company and the Company Subsidiaries do not and, as of the Closing, will not, have any (i) liabilities or obligations for fees payable to Affiliates, (ii) liabilities for transaction bonuses, or liabilities for Transaction Expenses incurred at any time from June 18, 2014 through the Closing Date, (iii) deferred long-term liabilities, seller notes or earn-outs or (iv) liabilities arising under any interest rate, currency, commodity or other similar swap, cap, collar, futures Contract or other hedging arrangement.

SECTION 4.09Taxes.

(a)(i) Each material Tax Return required to be filed by or on behalf of the Company or any Company Subsidiary has been timely filed and each such Tax Return is true, correct and complete in all material respects, (ii) all Taxes due and owing by or with respect to the Company or any Company Subsidiary (whether or not shown on any Tax Return) have been timely paid in full, and (iii) no material Tax liens have been filed and no material claims are being asserted in writing with respect to any Taxes of the Company or any Company Subsidiary, other than Permitted Liens.

(b)Neither the Company nor any Company Subsidiary is a “United States real property holding corporation” within the meaning of Section 897 of the Code.

(c)Neither the Company nor any Company Subsidiary has requested or filed any extension of time for the assessment or collection of any Tax or waived any statute of limitations in respect of Taxes.

(d)Neither the Company nor any Company Subsidiary (i) is the subject of any material audit or other Proceeding with respect to Taxes; (ii) has received or is otherwise

12

subject to any notice of deficiency or proposed adjustment for any amount of Tax relating to the Company or any Company Subsidiary; and (iii) has received or is otherwise subject to any notice from any Governmental Entity of any intent to open such an audit or proceeding with respect to Taxes relating to the Company or any Company Subsidiary.  No claim has ever been made in writing by an authority in a jurisdiction where the Company or any Company Subsidiary does not file Tax Returns that the Company or any Company Subsidiary is or may be subject to Tax by that jurisdiction.

(e)The Company and each Company Subsidiary has in all material respects timely withheld and paid, or caused to be paid, all Taxes required to have been withheld and paid by it in connection with any amounts paid or owing to any employee, independent contractor, creditor, shareholder or other third party.

(f)Neither the Company nor any Company Subsidiary has been the “distributing corporation” or the “controlled corporation” (in each case, within the meaning of Section 355(a)(1) of the Code) with respect to a transaction described in Section 355 of the Code.

(g)Neither the Company nor any Company Subsidiary has any liability under Treasury Regulations Section 1.1502-6 (or any comparable or similar provision of federal, state, local or foreign law), other than liability with respect to Taxes of a Seller consolidated group which includes Seller.

(h)Neither the Company nor any Company Subsidiary will be required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any (i) change in method of accounting for a taxable period ending on or prior to the Closing Date; (ii) installment sale or open transaction disposition made on or prior to the Closing Date; (iii) intercompany transaction or excess loss account described in Treasury Regulations under Section 1502 of the Code (or any corresponding or similar provision of state, local or foreign income Tax law); (iv) prepaid amount received on or prior to the Closing Date; or (v) election under Section 108(i) of the Code.

(i)Neither the Company nor any Company Subsidiary has engaged in any “listed transaction” as defined in the Treasury Regulations promulgated under Section 6011 of the Code.

(j)Neither the Company nor any Company Subsidiary is a party to any Tax sharing, allocation, indemnity or similar agreement or arrangement (other than any agreement or arrangement entered into in the ordinary course of business the primary purpose of which is not the sharing of Taxes) pursuant to which it will have any obligation to make any payments after the Closing.

(k)Notwithstanding any other provision of this Agreement, Seller makes no representation or warranty as to the amount or availability of any Tax attributes of the Company or any Company Subsidiary, including, without limitation, any net operating loss, tax credit or tax basis.

13

SECTION 4.10Assets Other than Real Property Interests.  The Company or one or more of the Company Subsidiaries has good and valid title to all material assets and properties reflected on the Balance Sheet or thereafter acquired, except those sold or otherwise disposed of since the date of the Balance Sheet in the ordinary course of business and not in violation of this Agreement (the “Assets”), in each case free and clear of all Liens , except (a) such as are set forth in Section 4.10 of the Seller Disclosure Schedule; (b) mechanics’, carriers’, workmen’s, repairmen’s or other like Liens arising or incurred in the ordinary course of business for amounts that are not yet delinquent or are being contested in good faith; and (c) Liens for Taxes and other governmental charges which are not due and payable or which may thereafter be paid without penalty or interest or are being contested in good faith by appropriate proceedings (the Liens described in clauses (a), (b), (c) and (d) above are hereinafter referred to collectively as “Permitted Liens”).  Except as set forth in Section 4.10 of the Seller Disclosure Schedule, the Assets (x) are in such condition and repair (ordinary wear and tear excepted) as is sufficient to operate the businesses of the Company and the Company Subsidiaries, consistent with past practice, (y) constitute all of the assets (tangible and intangible) used by the Company and the Company Subsidiaries for the business of the Company and the Company Subsidiaries during the periods covered by the Financial Statements and (z) are suitable for the uses for which they are intended.

This Section 4.10 does not relate to real property or interests in real property or Intellectual Property Rights, such items being the subjects of Sections 4.11, 4.12 and 4.13, respectively.

SECTION 4.11Real Property.

(a)Section 4.11(a) of the Seller Disclosure Schedule sets forth the address and description of each real property owned by the Company or any Company Subsidiary (the “Owned Real Property”).  Except as set forth on Section 4.11(a) of the Seller Disclosure Schedule, the Company or one or more of the Company Subsidiaries has not granted any third-party the right to use or occupy the Owned Real Property, whether by written lease, sublease, license, or any other written agreement, and no third party is occupying, and to the knowledge of Seller, no third party intends to occupy, the Owned Real Property.

(b)Section 4.11(b) of the Seller Disclosure Schedule sets forth a complete list of all real property and interests in real property leased by, subleased, or licensed to the Company or one or more of the Company Subsidiaries pursuant to any written or, to the knowledge of the Seller, oral agreement (individually, a “Leased Property”).  Except as set forth on Section 4.11(b) of the Seller Disclosure Schedule, the Company or one or more of the Company Subsidiaries has not subleased, licensed, assigned, or otherwise granted any third-party the right to use or occupy any of the Leased Property by written instrument or, to the knowledge of the Seller, oral agreement.

(c)The Company or one or more of the Company Subsidiaries has good and valid title to the leasehold estates in all Leased Property and has made true, correct, and complete copies of all written or, to the knowledge of the Seller, oral leases for the Leased Property available to Buyer.  The Company or one or more of the Company Subsidiaries has good and marketable fee simple title to all Owned Real Property (a Leased Property and an Owned Real

14

Property being sometimes referred to herein, individually, as a “Company Property”) and in each case the Company Property is free and clear of all mortgages, Liens, leases, assignments, subleases, easements, covenants, rights of way and other similar restrictions of any nature whatsoever, except (i) such as are set forth in Section 4.11(c) of the Seller Disclosure Schedule; (ii) Permitted Liens; (iii) easements, covenants, rights of way and other similar restrictions of record; (iv) any conditions that may be shown by a current, accurate survey or physical inspection of any Company Property made prior to the Closing and (v) (A) zoning, building and other similar restrictions, (B) mortgages, Liens, easements, covenants, rights of way and other similar restrictions that have been placed by any developer, landlord or other third party on property over which the Company or one or more of the Company Subsidiaries has easement rights or on any Company Property and subordination or similar agreements relating thereto, and (C) unrecorded easements, covenants, rights of way and other similar restrictions, none of which items set forth in clause (v), individually or in the aggregate, materially impair the continued use and operation of the property to which they relate in the business of the Company and the Company Subsidiaries as presently conducted.  Neither the Company nor any Company Subsidiary has received written notice of and there is no pending, and, to the knowledge of Seller, threatened condemnation proceeding affecting any Owned Real Property.

SECTION 4.12Intellectual Property.  (a) Section 4.12(a) of the Seller Disclosure Schedule sets forth as of the date hereof a complete list of (i) all Company Registered Intellectual Property and specifies, where applicable, the owner, the jurisdiction in which each such item of Company Registered Intellectual Property has been filed, issued or registered, and the respective application and registration numbers and dates (and, with respect to domain names, the registrar), (ii) software owned or used by the Company or any Company Subsidiary (identifying for each, the owner), other than “shrink wrap” and other commercially available software licensed on standard, non-negotiated terms with a replacement cost or annual license, maintenance, subscription and other fees of less than $25,000 in the aggregate, and (iii) material unregistered trademarks used by the Company or any Company Subsidiary.  All necessary registration, maintenance and renewal fees currently due in connection with each item of Company Registered Intellectual Property have been made and all necessary documents, recordations and certificates in connection with such Company Registered Intellectual Property have been filed with the appropriate Governmental Entity.

(b)The Company or one or more of the Company Subsidiaries has good and marketable title to, and exclusively owns all right, title and interest in and to, each material item of Company Intellectual Property owned by the Company or any Company Subsidiary.  The Company Intellectual Property owned by the Company or one or more of the Company Subsidiaries is free and clear of any Liens, except for Permitted Liens or non-exclusive licenses with respect to such Company Intellectual Property granted in the ordinary course of business.  To the knowledge of Seller, the Company Registered Intellectual Property owned by the Company or any Company Subsidiary is valid, subsisting and enforceable.  No outstanding order, consent, settlement, decree, injunction, ruling, judgment or stipulation restricts the use, ownership, transfer or licensing of Company Intellectual Property owned by the Company or any Company Subsidiary in any material respect.

(c)To the knowledge of Seller, the Company has not, since June 18, 2014, infringed or misappropriated, and the operation of the business of the Company and the Company

15

Subsidiaries as such business is currently conducted does not infringe or misappropriate, the Intellectual Property Rights of any person.  Since June 18, 2014, neither the Company nor any Company Subsidiary has received any written notice from any person or been subject to any claims (including oppositions or cancellation actions and demands or offers to license any Intellectual Property Rights) by any person (i) alleging that the operation of the business of the Company or any Company Subsidiary or any product or service of the Company or any Company Subsidiary, infringes, misappropriates, or otherwise conflicts with the Intellectual Property Rights of any third party or (ii) contesting the validity, use, ownership, enforceability or registrability of any of the Company Registered Intellectual Property.  To the knowledge of Seller, no person is infringing or misappropriating any Company Intellectual Property owned by the Company or any Company Subsidiary.

(d)Seller and the Company have taken commercially reasonable steps to protect the rights of the Company and the Company Subsidiaries in, including the secrecy, confidentiality and value of, the confidential information and trade secrets that they wish to protect or any trade secrets or confidential information of third parties provided to the Company or any Company Subsidiary.

SECTION 4.13Material Contracts.  Except as set forth in Section 4.13 of the Seller Disclosure Schedule (and excluding the Benefit Plans), neither the Company nor any Company Subsidiary is a party to any:

(a)Contract or commitment limiting or restricting the ability of the Company or any Company Subsidiary, in any material respect, from engaging in or competing in any line of business in any territory or soliciting employees, service providers, customers or supplies;

(b)Contract (other than an employment agreement or nonsolicitation/noncompetition agreement) with (i) Seller or any Affiliate of Seller (other than the Company or any Company Subsidiary) or (ii) any officer, director or employee of the Company, Seller, any Company Subsidiary or any other Affiliate of Seller;

(c)Contract (other than any Contract terminable on less than 30 days’ notice without the payment of severance or similar benefits) for the employment of any officer or other employee on a full-time, part-time, or other basis providing annual compensation in excess of $100,000;

(d)other than for (i) “shrink wrap” and other commercially available software licensed on standard, non-negotiated terms with a replacement cost or annual license, maintenance, subscription and other fee of less than $25,000 in the aggregate, (ii) non-disclosure agreements that provide no more than limited use rights of trade secrets or confidential information or (iii) non-exclusive licenses or sublicenses granted by the Company or any Company Subsidiary in the ordinary course of business, any Contracts, licenses, options or agreements (x) with respect to Company Intellectual Property licensed or transferred to any third party or (y) pursuant to which a third party has licensed or transferred any Intellectual Property Rights to the Company or any Company Subsidiary;

16

(e)any Contract evidencing Indebtedness which, individually, is in excess of $100,000;

(f)Contract (including so called take or pay or keepwell agreements) under which (i) any person has directly or indirectly guaranteed Indebtedness, liabilities or obligations of the Company or any Company Subsidiary or (ii) the Company or any Company Subsidiary has directly or indirectly guaranteed indebtedness, liabilities or obligations of any person (in each case other than endorsements for the purpose of collection in the ordinary course of business), in any such case which, individually, is in excess of $50,000;

(g)Contract under which the Company or any Company Subsidiary has, directly or indirectly, made any advance, loan, extension of credit or capital contribution to, or other investment in, any person, in any such case which, individually is in excess of $50,000, or in the aggregate in excess of $150,000;

(h)Contract pursuant to which any third party manages any business belonging to the Company or any of the Company Subsidiaries or is given the right (whether or not contingent) to operate or manage a business on the premises owned, operated or leased by the Company or any of the Company Subsidiaries;

(i)Contract under which the Company or any Company Subsidiary is lessor of or permits any third party to hold or operate any material tangible property, owned or controlled by the Company or a Company Subsidiary;

(j)material mortgage, pledge, security agreement, deed of trust or other instrument granting a Lien upon any Company Property, which Lien is not set forth in Sections 4.11(a), 4.11(b) or 4.11(c) of the Seller Disclosure Schedule;

(k)Contract with any labor organization or with any association of employees for purposes of collective bargaining;

(l)Contract (other than any Contract terminable on less than 30 days’ notice without the payment of any termination or similar benefits) for the engagement of any person providing advisory or consulting services (e.g., investment banking, regulatory, IT, legal or accounting) to the Company or the Company Subsidiaries and providing for annual compensation in excess of $100,000;

(m)joint venture or similar agreement (other than non-binding teaming agreements entered by the Company or any Company Subsidiary in the ordinary course of business);

(n)Contract that provides for any person to be the exclusive or preferred provider of any product or service, or the exclusive or preferred recipient of any product or service during any period;

(o)Contract granting to any person an option or a first refusal or similar preferential right to purchase or acquire any material asset of the business of the Company or any Company Subsidiary;

17

(p)Contract pursuant to which the Company or any Company Subsidiary has any continuing indemnity or similar obligations or undertakings to any third person in respect of the sale of a business to such third person;

(q)Contract that contains a power of attorney;

(r)Contract that is a settlement, conciliation or similar agreement (i) with any Governmental Entity entered into any time since June 18, 2014, (ii) that will require the Company or any Company Subsidiary to pay consideration to any person or (iii) that would impose any material non-monetary obligations upon the Company or any Company Subsidiary after the date of this Agreement;

(s)Contract with any of its current or former employees, directors or consultants that requires any sale, “stay-around,” “change of control,” retention, severance or similar bonuses or payments to current or former directors, officers, employees or consultants payable by the Company or any Company Subsidiary and agreed to by the Company or any Company Subsidiary on or before the date hereof where at least one of the conditions to such bonuses or payments is the closing of the transactions contemplated by this Agreement; or

(t)Contract, lease, license, commitment or instrument to which the Company or any Company Subsidiary is a party or by or to which it or any of its assets or business is bound or subject which has an aggregate future liability to any person in excess of $500,000 and is not terminable by the Company by notice of not more than thirty (30) days for a cost of less than $250,000.

Each agreement, contract, lease, license, commitment or instrument required to be listed in Section 4.13 of the Seller Disclosure Schedule (collectively, the “Material Contracts”) is valid, binding and in full force and effect and is enforceable by the Company or the Company Subsidiary party thereto in accordance with its terms subject to the Bankruptcy and Equity Exception.  The Company and each Company Subsidiary have performed all material obligations required to be performed by them to date under the Material Contracts and neither the Company nor any Company Subsidiary is (with or without the lapse of time or the giving of notice, or both) in breach or default in any material respect thereunder and, to the knowledge of Seller, no other party to any of the Material Contracts, as of the date hereof, is (with or without the lapse of time or the giving of notice, or both) in breach or default in any material respect thereunder, nor does any condition exist that with notice or lapse of time or both would constitute such a material default thereunder by any such party.  There have been made available to Buyer, to the knowledge of Seller, true and complete copies of all of the Material Contracts.  The parties hereby acknowledge that all Contracts with Honeywell International, Inc. and its Affiliates, on one hand, and the Seller and its Affiliates, on the other hand, that relate to the Interim Remedial Measure for the Willis Avenue and Semet Tar Beds Site, shall be contracts to which only the Company and Company Subsidiaries, and none of the Seller or Seller’s Affiliates (other than the Company and Company Subsidiaries), have any rights relating thereto.

SECTION 4.14Litigation.  Section 4.14 of the Seller Disclosure Schedule sets forth a list of all pending or, to the knowledge of Seller, threatened lawsuits, claims, complaints, arbitrations, actions, causes of actions, governmental, regulatory or administrative agency

18

investigations, hearings or legal or arbitral proceedings (collectively, “Proceedings”) since June 18, 2014 against the Company or any Company Subsidiary or any of their respective properties, assets, operations or businesses, other than any Proceeding involving a claim against the Company or any Company Subsidiary which would reasonably be likely to result in liability of less than $50,000 individually or less than $150,000 in the aggregate.  Neither the Company nor any Company Subsidiary is a party or subject to or in material default under any judgment, order, injunction, award, settlement, decree or writ (collectively, “Orders”) of any Governmental Entity or arbitration tribunal applicable to it or any of its respective properties, assets, operations or business.  This Section 4.14 does not relate to matters with respect to environmental matters, which are the subject of Section 4.19, or to matters with respect to employee benefits or ERISA matters, which are the subject of Section 4.15.

SECTION 4.15Benefit Plans.  (a) Section 4.15(a) of the Seller Disclosure Schedule contains a list of all written “employee benefit plans” (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974 (“ERISA”)) and all other material employment, severance, change in control, retention, consulting, vacation benefits, retirement, post-retirement, bonus, stock option, deferred and incentive compensation plans, policies and programs or any other material compensatory and fringe benefits plans, policies and programs (excluding workers’ compensation, unemployment compensation and other government programs) (1) maintained or contributed to by the Company or any Company Subsidiary (other than the Multiemployer Plans, the “Company Plans”) or (2) maintained or contributed to by Seller or any of its Affiliates (other than the Company or any Company Subsidiary) for the benefit of current or former employees of the Company or any Company Subsidiary or any employee set forth in Section 8.07(a) of the Seller Disclosure Schedule (other than Multiemployer Plans, the “Seller Plans,”  and collectively with the Company Plans, the “Benefit Plans”).  Section 4.15(a) of the Seller Disclosure Schedule separately identifies the Company Plans and the Seller Plans.

(b)Seller has delivered the following documents to Buyer with respect to each Company Plan:  (1) correct and complete copies of all documents embodying such Company Plan, (2) the most recent summary plan description together with the summary or summaries of material modifications thereto, if any, (3) all Internal Revenue Service or Department of Labor determination, opinion, notification and advisory letters, (4) the most recent annual report (Form Series 5500 and all schedules and financial statements attached thereto), if any, and (5) all material correspondence to or from any Governmental Entity received since June 18, 2014.

(c)Each Company Plan has been established, documented, and maintained in compliance in all material respects with, to the extent applicable to such plan, ERISA, the Code, and all Applicable Laws.  Each Company Plan intended to be qualified under Section 401(a) of the Code and each related trust intended to qualify under Section 501(a) of the Code has obtained a currently effective favorable determination notification, advisory and/or opinion letter, as applicable, as to its qualified status (or the qualified status of the master or prototype form on which it is established) from the Internal Revenue Service, and no amendment to such Company Plan has been adopted since the date of such letter covering such Company Plan that would reasonably be expected to adversely affect such favorable determination.  With respect to each Company Plan, (i) in all material respects, no breaches of fiduciary duty or other failures to act or comply in connection with the administration or investment of the assets of such

19

Company Plan have occurred, (ii) no lien has been imposed under the Code, ERISA or any other applicable law, and (iii) there have been no non-exempt prohibited transactions (within the meaning of Section 406 of ERISA or Section 4975 of the Code) with respect to any Company Plan that could reasonably be expected to result in material liability.

(d)Neither the Company nor any Company Subsidiaries nor any entity which is considered a “single employer” with the Company or any Company Subsidiaries under Section 414(b), (c), (m) or (o) of the Code (an “ERISA Affiliate”) maintains or has an obligation to contribute, and neither the Company nor any Company Subsidiary otherwise has any liability (contingent or otherwise), with respect to (i) a plan described in Section 413 of the Code, (ii) a plan subject to Title IV of ERISA or (iii) a plan subject to the minimum funding standards of Section 412 of the Code or Section 302 of ERISA.  Neither the Company nor any Company Subsidiaries has incurred any liability or obligation, with respect to any “employee benefit plan” (as defined in Section 3(3) of ERISA) that is not sponsored by it by reason of being treated as a single employer with any ERISA Affiliate (other than the Company and the Company Subsidiaries).  No Proceedings, audits, or investigations (other than routine benefit claims) are pending or, to the knowledge of Seller, threatened against or relating to any Company Plan, or any fiduciary thereof.  In all material respects, all payments, benefits, contributions (including all employer contributions and employee salary reduction contributions) and premiums related to each Company Plan, including all bonuses, benefits and other compensation due to or on behalf of any employees or other service providers, have been timely paid or made in accordance with the requirements of Applicable Law or, to the extent not yet due, properly accrued in accordance with GAAP.  No Benefit Plan has any unfunded liabilities that have not been properly accrued in accordance with GAAP.

(e)Except as set forth in Section 4.15(e) of the Seller Disclosure Schedule, none of the Company, any Company Subsidiary or any ERISA Affiliate contributes to or has any actual or potential liability with respect to any multiemployer plan (as defined in Section 3(37) of ERISA) (each, a “Multiemployer Plan”).  None of the Company, any Company Subsidiary or any ERISA Affiliate has incurred any withdrawal liability with respect to any Multiemployer Plan.  To the knowledge of Seller, no Multiemployer Plan (i) has filed a notice of reorganization, insolvency or termination under Section 4041A of Title IV of ERISA, (ii) is in “at risk” status within the meaning of Section 430(i) of the Code, or (iii) is in “endangered status” or “critical status” within the meaning of Section 432(b) of the Code.  The Company, each Company Subsidiary and each ERISA Affiliate has made all required contributions to any Multiemployer Plan when due.

(f)No Company Plan provides benefits with respect to any former or current employee of the Company or any Company Subsidiary or any employee set forth in Section 8.07(a) of the Seller Disclosure Schedule, or any spouse or dependent of any such employee, beyond the employee’s retirement or other termination of employment other than (1) coverage mandated by Part 6 of Title I of ERISA or Section 4980B of the Code, or (2) benefits in the nature of severance pay with respect to one or more of the employment contracts set forth in Section 4.15(a) of the Seller Disclosure Schedule.

(g)Except with respect to payments disclosed on Section 4.15(g) of the Seller Disclosure Schedule, the transactions contemplated by this Agreement shall not, either alone or

20

in connection with other events, give rise to the payment of any amount that would not be deductible by the Company or any Company Subsidiary by reason of Section 280G of the Code.  Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby will (i) entitle any current or former employee, consultant or director to any payment; (ii) increase the amount of compensation or benefits due to any such employee, consultant or director; or (iii) accelerate the vesting, funding or time of payment of any compensation, equity award or other benefit.

SECTION 4.16Absence of Changes or Events.  (a) Since June 18, 2014 to the date hereof, there has not been any Material Adverse Effect.

(b)           Except as contemplated by this Agreement, since June 18, 2014, Seller has caused the business of the Company and the Company Subsidiaries to be conducted in the ordinary course consistent with past practices and, since the date of the Balance Sheet, neither the Company nor any Company Subsidiary has taken any action that, if taken after the date of this Agreement, would constitute a breach of any of the covenants set forth in Section 5.02.

SECTION 4.17Compliance with Applicable Laws.  (a) Except as set forth in Section 4.17 of the Seller Disclosure Schedule, the Company and each Company Subsidiary is and has been since June 18, 2014, in material compliance with all applicable statutes, laws, ordinances, codes, rules, Orders, regulations and other requirements promulgated by any Governmental Entity (“Applicable Law”).  Neither Seller nor the Company has received any written communication since June 18, 2014 from a Governmental Entity that alleges that the Company or any Company Subsidiary is in violation in any material respect with any Applicable Law or Order.  This Section 4.17(a) does not relate to matters with respect to Taxes, which are the subject of Section 4.08, to employee benefit or ERISA matters which are the subject of Section 4.15 or to environmental matters, which are the subject of Section 4.19.

(b)The Company and the Company Subsidiaries have all governmental franchises, licenses, permits, authorizations, approvals, consents, certificates, exemptions and qualifications of, and have made all required registrations with, any Governmental Entity that are material to the conduct of the business of the Company and the Company Subsidiaries, or the use of any material properties of the Company and the Company Subsidiaries (other than the Environmental Permits, which are addressed separately in Section 4.19) (collectively, the “Permits”).  The Company and the Company Subsidiaries have maintained the effectiveness of their respective Permits, including the timely submission of applications for renewal or reissuance of such Permits.  No Proceeding to revoke, limit or modify any of such Permits has been served upon the Company or any of the Company Subsidiaries, or is pending, or to the knowledge of the Company is threatened, and the Company and the Company Subsidiaries are, and have at all times been, in compliance in all material respects with all terms and conditions of such Permits since June 18, 2014.  No loss or expiration of any Permit is pending or, to the knowledge of the Company, threatened (excluding as a result of the transactions contemplated herein), other than by reason of expiration of such Permit in the ordinary course (and for which the Company or applicable Company Subsidiary expects to obtain a replacement Permit prior to or substantially simultaneously with such expiration).  All Permits are valid and in full force and effect.  Section 4.17(b) of the Seller Disclosure Schedule sets forth a true and complete list of all Permits.

21

SECTION 4.18Employee and Labor Matters.  (a) There is not and since June 18, 2014 there has not been, any labor strike, dispute, work stoppage or lockout pending, or, to the knowledge of Seller, threatened, against the Company or any Company Subsidiary; (b) to the knowledge of Seller, no union organizational campaign has occurred since June 18, 2014 with respect to the employees of the Company or any Company Subsidiary and no question concerning representation exists or has existed since such date respecting such employees; (c) there is, and since June 18, 2014 there has been, no unfair labor practice charge or complaint against the Company or the Company Subsidiaries pending, or, to the knowledge of Seller, threatened, before the National Labor Relations Board; (d) there are, and since June 18, 2014 there have been, no pending, or, to the knowledge of Seller, threatened, material union grievances against the Company or any of the Company Subsidiaries; (e) there are, and since June 18, 2014 there have been, no pending, or, to the knowledge of Seller, threatened, charges against the Company or any of the Company Subsidiaries or any of their respective current or former employees before the Equal Employment Opportunity Commission or any state or local agency responsible for the prevention of unlawful employment practices; and (f) neither Seller nor the Company has received written notice of the intent of any Governmental Entity responsible for the enforcement of labor or employment laws to conduct an investigation of the Company or any Company Subsidiary and, to the knowledge of Seller, no such investigation is in progress.  The Company and each Company Subsidiary is, and since June 18, 2014, has remained in compliance in all material respects with all applicable statutes, laws, ordinances, rules, orders and regulations of any Governmental Entity pertaining to employment and employment practices.  Neither the Company nor any Company Subsidiary has any outstanding liability under the federal Worker Adjustment and Retraining Notification Act, or any similar applicable state or local law, with respect to employee layoffs implemented since June 18, 2014.  Except as set forth in Section 4.18 of the Seller Disclosure Schedule, neither the Company nor any Company Subsidiary has terminated the employment of any employee within 90 days of the date hereof.

SECTION 4.19Environmental Matters.

(a)The Company and the Company Subsidiaries are, and at all times since June 18, 2014 have been, in compliance in all material respects with all Environmental Laws.

(b)The Company and the Company Subsidiaries have, and have at all times since June 18, 2014 had, all material governmental franchises, licenses, permits, orders, registrations, authorizations and approvals required pursuant to Environmental Laws for the operations of the Company and the Company Subsidiaries (“Environmental Permits”), and all such Environmental Permits are in full force and effect.  The Company and the Company Subsidiaries have each taken all actions required to maintain the effectiveness of their respective Environmental Permits, including the timely submission of applications for renewal or reissuance of such Environmental Permits.  No claim to revoke, limit or modify any of such Environmental Permits has been served upon the Company or any of the Company Subsidiaries, or is pending, or to the knowledge of the Company is threatened, and the Company and the Company Subsidiaries are, and have at all times been, in compliance in all material respects with all terms and conditions of such Environmental Permits since June 18, 2014.

22

(c)No Hazardous Substances have been Released since June 18, 2014 by or as a result of any action or omission of the Company, the Company Subsidiaries or any other person on or under any real property currently or formerly owned, leased or operated by the Company or any of the Company Subsidiaries, including to the soil, groundwater, surface water or structures, that requires or would require the Company or any of the Company Subsidiaries to undertake any Remedial Action or has resulted or would otherwise result in the assertion of a material claim under any Environmental Law against the Company or any of the Company Subsidiaries or so as to give rise to any current or future material liabilities under any Environmental Law for the Company or any of the Company Subsidiaries.

(d)None of the Company or the Company Subsidiaries since June 18, 2014 have generated, treated, stored, disposed of, transported or arranged for transportation or disposal of, or exposed any person to, any Hazardous Substance in a manner that would result in the assertion of a material Environmental Claim against any of the Company or the Company Subsidiaries or so as to give rise to any current or future material liabilities (including any obligation to undertake any Remedial Action) under any Environmental Law for the Company or any of the Company Subsidiaries.

(e)None of the Company or the Company Subsidiaries are subject to any Environmental Claim that is currently pending or, to the knowledge of the Company, threatened against the Company or any of the Company Subsidiaries nor is there any pending or, to the knowledge of the Company, threatened investigation by any Governmental Entity or other person that could result in the assertion of a material Environmental Claim against the Company or any of the Company Subsidiaries.

(f)Since June 18, 2014, none of the Company or the Company Subsidiaries have received any notice, report, order, directive or other information regarding any actual or alleged material violation of, or liability (including any obligation to undertake any Remedial Action) under, Environmental Laws with respect to any of its businesses, properties or facilities.

(g)Since June 18, 2014, none of the Company or the Company Subsidiaries have, either expressly or by operation of Applicable Law, assumed, undertaken, or provided an indemnity that is unexpired with respect to any material liability (including any obligation to undertake any Remedial Action) of any other person relating to Environmental Laws, except for (i) any indemnities set forth in service contracts or agreements or customer purchase orders (collectively, “Customer Service Contracts”) entered between the Company or any Company Subsidiary and its customers under which the Company or such Company Subsidiaries must indemnify, defend or hold harmless or otherwise be held liable to such customers for any Environmental Claims resulting from the services provided by the Company or such Company Subsidiary pursuant to such Customer Service Contracts and (ii) the environmental guarantees set forth in the L&L Guaranty.

(h)Since June 18, 2014, none of the Company or the Company Subsidiaries have owned, operated or leased any real property other than as listed on Section 4.11 of the Seller Disclosure Schedule.

23

(i)To the knowledge of Seller, there are no above ground or underground storage tanks, asbestos containing materials or transformers containing or contaminated with Polychlorinated Biphenyls at, on, about or beneath any of the owned, operated or leased real property listed on Section 4.11 of the Seller Disclosure Schedule, in each case that would give rise to any material liabilities under any Environmental Law for the Company or any of the Company Subsidiaries.

(j)The business operations at the Rahway Site are properly classified within the scope of North American Industry Classification System (“NAICS”) 562998, titled “All Other Miscellaneous Waste Management Services - Tank Cleaning and Disposal Services, Commercial or Industrial,” and, as a result, the Rahway Site is an “industrial establishment” subject to compliance with the requirements of ISRA due to the transactions described in this Agreement.

(k)The business operations at the Linden Site are properly classified within the scope of NAICS 562910, titled “Remediation Services,” and, as a result, the Linden Site is not an “industrial establishment” subject to compliance with the requirements of ISRA due to the transactions described in this Agreement.

(l)The representations and warranties set forth in Section 4.02 (No Conflicts; Consents), Section 4.07 (Financial Statements; Undisclosed Liabilities), Section 4.16 (Absence of Certain Changes or Events) and this Section 4.19 are the sole and exclusive representations and warranties of the Company and the Company Subsidiaries pertaining to or relating to matters arising under Environmental Law or other environmental matters (“Environmental Matters”), and no other representation or warranty of the Company or any Company Subsidiary set forth in this Agreement shall be read or construed so as to address Environmental Matters.

(m)The Company and the Company Subsidiaries have made available to Buyer complete and accurate copies of all material environmental reports, audits, permits, compliance statements or assessments prepared or updated since June 18, 2014 that are in the possession or under the reasonable control of the Company or the Company Subsidiaries.

SECTION 4.20Broker’s Fees.  There is no investment banker, broker, finder or other intermediary or other person that has been retained by or is authorized to act on behalf of Seller, the Company or any of the Company Subsidiaries who is entitled to any fee or commission from Seller or any of its Affiliates in connection with the transactions contemplated by this Agreement.

SECTION 4.21Affiliated Transactions.  Except for employment relationships and the payment to employees of compensation and benefits in the ordinary course of business and except as set forth on Section 4.21 of the Seller Disclosure Schedule, no officer, director or Affiliate (other than the Company or any Company Subsidiary or Mr. Lou Galasso III) of Seller, the Company or any Company Subsidiary (i) is, directly or indirectly, a party to any Contract with the Company or any Company Subsidiary, or (ii) owns or has, directly or indirectly, any interest in any asset, property or right, tangible or intangible, used by the Company or any Company Subsidiary.

24

SECTION 4.22Insurance.

(a)The Company has, or has caused to be made, available to Buyer all of the insurance policies or binders for which the Company or any Company Subsidiary is a policyholder or which covers the business or assets of the Company or the Company Subsidiaries, in each case that are in effect as of the date hereof (“Insurance Policies”), and Section 4.22 of the Seller Disclosure Schedule sets forth a complete list of the Insurance Policies.  All Insurance Policies are in full force and effect in accordance with their terms and all premiums with respect thereto covering all periods up to and including the Closing Date have been paid or will be paid when due, and the Company and Company Subsidiaries have complied in all material respects with the provisions of such Insurance Policies.  Since June 18, 2014, neither the Company nor any Company Subsidiary has received any written notice canceling or amending any of the Insurance Policies, increasing any deductibles or retained amounts thereunder, increasing premiums payable thereunder or notifying the Company or any Company Subsidiary that it is in default of an Insurance Policy.  There is no claim by the Company or any Company Subsidiary pending under any of Insurance Policy as to which coverage has been denied or disputed in writing by the underwriters or in respect of which the underwriters have reserved their rights.  This Section 4.22 shall not apply to insurance policies that are related to Benefit Plans.

(b)Section 4.22(b) of the Seller Disclosure Schedule sets forth a list of all surety and performance bonds, letters of credit or similar instruments issued by or on behalf of the Company or any Company Subsidiary or with respect to the business of the Company or any Company Subsidiary.

SECTION 4.23Customers and Suppliers.

(a)Section 4.23(a) of the Seller Disclosure Schedule sets forth a list of the ten (10) largest customers of the Company on a consolidated basis with the Company Subsidiaries as measured by the aggregate revenue received by the Company on a consolidated basis with the Company Subsidiaries from such customers for the twelve-month period commencing on January 1, 2014 and ending on December 31, 2014.  Since June 18, 2014, none of the Company or any Company Subsidiary has received any written notice from any such customer to the effect that such customer will stop, or materially decrease the rate of, buying products or services from the Company or any Company Subsidiary.

(b)Section 4.23(b) of the Seller Disclosure Schedule sets forth a list of the ten (10) largest suppliers of the Company on a consolidated basis with the Company Subsidiaries as measured by the aggregate expenses accrued by the Company on a consolidated basis with the Company Subsidiaries with respect to payments to such suppliers for the twelve month period commencing on January 1, 2014 and ending on December 31, 2014.  Since June 18, 2014, none of the Company or any Company Subsidiary has received any written notice from any such supplier to the effect that such supplier will stop, materially decrease the rate of, or materially and adversely change the terms (whether related to payment, price or otherwise) with respect to, supplying materials, products or services to the Company or any Company Subsidiary.

25

ARTICLE V

Covenants of Seller

Seller covenants and agrees as follows:

SECTION 5.01Access.  From the date hereof to the Closing, Seller shall, and shall cause the Company and the Company Subsidiaries to, give Buyer and its representatives, employees, counsel and accountants reasonable access, during normal business hours and upon reasonable notice, to the personnel, properties, books and records of the Company and the Company Subsidiaries (including, as applicable, the ability to make copies and abstracts thereof), and furnish Buyer with such financial and operating data and other information with respect to the business and properties of the Company and Company Subsidiaries as Buyer may from time to time reasonably request; provided, however, that such access does not unreasonably disrupt the normal operations of Seller or the Company or the Company Subsidiaries or cause the loss of any attorney-client privilege.  Without limiting the foregoing, from the date hereof to the Closing, Seller shall, and shall cause the Company and the Company Subsidiaries to, provide to Buyer monthly operating statements promptly after the conclusion of each fiscal month of the Company, which shall include monthly statements of profit and loss to the extent available.

SECTION 5.02Ordinary Conduct.

(a)Except as set forth in Section 5.02(a) of the Seller Disclosure Schedule or otherwise contemplated by the terms of this Agreement, from the date hereof to the Closing, Seller shall conduct the business of the Company and the Company Subsidiaries in all material respects in the ordinary course consistent with past practices and shall use commercially reasonable efforts to maintain and preserve intact the current business organization of the Company and the Company Subsidiaries and preserve the material rights and assets of the Company and the Company Subsidiaries and the relationships with customers, suppliers and employees of the Company and the Company Subsidiaries.

(b)Except as set forth in Section 5.02(b) of the Seller Disclosure Schedule or otherwise expressly contemplated by the terms of this Agreement, from the date hereof to the Closing, neither the Company nor any Company Subsidiary shall, and Seller shall not permit the Company or any Company Subsidiary to, do any of the following without the prior written consent of Buyer (such consent not to be unreasonably withheld, conditioned or delayed):

(i)amend its Certificate of Incorporation or Bylaws or similar governing documents;

(ii)declare or pay any dividend or make any other distribution to its stockholder whether or not upon or in respect of any shares of its capital stock, other than dividends or other distributions paid or made solely to the Company or any other Company Subsidiary; provided, however, that Buyer acknowledges that the Company does not maintain cash balances and, prior to the Effective Time (but in no event thereafter), Seller will withdraw any cash balances of the Company;

26

(iii)redeem or otherwise acquire any shares of its capital stock or issue any capital stock or any option, warrant or right relating thereto or any securities convertible into or exchangeable for any shares of capital stock;

(iv)liquidate or dissolve;

(v)(A) hire any new employees or individual service providers other than (x) in the ordinary course of business consistent with past practice with respect to employees or individual service providers with an individual annual compensation opportunity of less than $100,000 or (y) to replace any employee existing as of the date hereof who resigns or whose employment is terminated or (B) except as required by Applicable Law or as required by any Benefit Plan disclosed on Section 4.15(a) of the Seller Disclosure Schedule , adopt, amend or terminate any Benefit Plan or otherwise increase the benefits provided under any Benefit Plan or otherwise grant to any employee or individual service provider of the Company or any Company Subsidiary any increase in compensation or benefits, except, with respect to non-officer employees, in the ordinary course of business consistent with past practice or as may be required under existing agreements;

(vi)incur or assume any liabilities, obligations or indebtedness for borrowed money or guarantee any such liabilities, obligations or indebtedness, other than, prior to the Effective Time (but in no event thereafter), in the ordinary course of business; provided, that in no event shall the Company or any Company Subsidiary incur, assume or guarantee any long-term indebtedness for borrowed money;

(vii)permit, allow or suffer any of its assets to become subjected to any Lien (other than Permitted Liens);

(viii)cancel any material indebtedness (individually or in the aggregate) or waive any claims or rights of material value;

(ix)except for (A) dividends and distributions permitted under clause (ii) above, and (B) intercompany transactions in the ordinary course of business or necessary to settle intercompany accounts prior to the Closing, pay, loan or advance any amount to, or sell, transfer or lease any of its assets to, or enter into any agreement or arrangement with, Seller or any of its Affiliates other than the Company and the Company Subsidiaries;

(x)make any change in any method of accounting or accounting practice or policy other than those required by United States generally accepted accounting principles or Applicable Law;

(xi)acquire by merging or consolidating with, or by purchasing a substantial portion of the assets of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof or otherwise acquire any assets (other than inventory or in the ordinary course of business consistent with past practices) which are material, individually or in the aggregate, to the business of the Company and the Company Subsidiaries;

(xii)(A) for any capital expenditure (other than those contemplated by clause (B) below), make or incur any capital expenditure that is not currently approved in writing or

27

budgeted which, individually, is in excess of $75,000 or make or incur any such expenditures which, in the aggregate, are in excess of $250,000 and (B) for any growth capital expenditure, make or incur any such growth capital expenditure that is not approved or consented to by Mr. Lou Galasso III, unless, in the case of clause (A) and clause (B) above, such capital expenditure (whether or not a growth capital expenditure ) is required for safety or compliance purposes or required by Applicable Law or a Governmental Entity;

(xiii)sell, lease or otherwise dispose of any of its assets which are material, individually or in the aggregate, to the business of the Company and the Company Subsidiaries, except in the ordinary course of business consistent with past practices or enter into any lease of any personal property except leases entered into in the ordinary course of business consistent with past practices with aggregate lease payments for all such leases not in excess of $250,000;

(xiv)enter into any new lease of real property;

(xv)modify, amend, terminate or permit the lapse of any lease of, or reciprocal easement agreement, operating agreement or other material agreement relating to, Leased Property (except modifications or amendments associated with any renewal of an existing lease in the ordinary course of business consistent with past practices on substantially the same terms as the existing leases);

(xvi)make any material payments of accounts payable or any material collections of accounts receivable other than, prior to the Effective Time (but in no event thereafter), in the ordinary course of business consistent with past practices;

(xvii)institute, pay, discharge, compromise, settle or satisfy (or agree to do any of the preceding with respect to) any material claims, liabilities or obligations (whether absolute, accrued, asserted or unasserted, contingent or otherwise), other than as required by their terms as in effect on the date of this Agreement and other than such claims, liabilities or obligations reserved against on the Balance Sheet (for amounts not in excess of such reserves);

(xviii)license, assign, transfer, sell, abandon, or otherwise dispose of, any material Intellectual Property Rights (except non-exclusive licenses granted in the ordinary course of business consistent with past practice); or

(xix)agree, whether in writing or otherwise, to do any of the foregoing.

(c)Notwithstanding anything in this Agreement to the contrary, including the provisions of Section 5.02(b) and (c), prior to the Effective Time (but in no event thereafter), (i) Seller (x) shall transfer, assign or otherwise convey to the Company the assets, Contracts, other agreements, permits and licenses listed on Section 5.02(c) of the Seller Disclosure Schedule and (y) shall, with Buyer’s approval, transfer, assign or otherwise convey to the Company assets, Contracts, other agreements, permits and licenses that relate to the business of the Company and the Company Subsidiaries to the extent any such assets (A) individually do not exceed $5,000, or in the aggregate do not exceed $75,000, based on net book value as of the date hereof or (B) are vehicles, in all cases, free and clear of all Liens (subject to the last sentence of this section, clauses (x) and (y) collectively, the “Pre-Closing Transfers”) and (ii) Seller, the Company and the Company Subsidiaries shall be permitted, and have the right, to, based on the Seller

28

Accounting Policies, allocate certain accounting entries, including bad debt reserves, among Seller, the Company and the Company Subsidiaries, to the extent such entries relate to the Company or the Company Subsidiaries.  Any objections by Buyer to the allocation of accounting entries pursuant to Section 5.02(c)(ii) hereof shall be resolved by the Accounting Firm after the Closing based on the Seller Accounting Policies.  Notwithstanding anything in this Agreement to the contrary, if any Pre-Closing Transfer is not legally or contractually permissible, such Pre-Closing Transfer shall not be required pursuant to this Agreement and the parties hereto shall instead reasonably cooperate to enter into alternate arrangements to pass through the benefits and obligations of the asset, Contract, other agreement, permit or license that is the subject of such Pre-Closing Transfer to Buyer, the Company or the Company Subsidiaries.

SECTION 5.03Assignment of ASPV Acquisition Documents.  Prior to the Closing Date, Seller shall assign to the Company, and the Company will assume, that certain Agreement and Plan of Merger, dated as of May 17, 2013, by and among EQ Holdings, Inc., ASPV Merger Sub, Inc., Allstate Power Vac, Inc. and the person defined therein as the Representative (the “ASPV Merger Agreement”) and the Transaction Documents (as defined in the ASPV Merger Agreement, together with the ASPV Merger Agreement, the “ASPV Acquisition Documents”), and all rights and obligations under the ASPV Acquisition Documents, including all rights in respect of the Indemnity Account (as defined in the ASPV Merger Agreement), the Remediation Account (as defined in the ASPV Merger Agreement) and the L&L Mortgage Account (as defined in the ASPV Merger Agreement), in each case, in a form and in substance reasonably acceptable to Buyer.  Following Closing, Seller shall, and shall cause its Affiliates to, execute and deliver such additional documents, instruments, conveyances and assurances, and take, or cause to be taken, all further reasonable actions requested by Buyer as may be required to carry out the provisions of this Section 5.03 and required in order to deliver to the Buyer the benefit contemplated to be delivered to the Buyer pursuant to this Section 5.03.

SECTION 5.04Exclusive Dealing.  During the period from the date of this Agreement through the Closing or the earlier valid termination of this Agreement pursuant to Section 13.01, the Seller shall not, and shall cause its Affiliates, including the Company and each Company Subsidiary, and each of their respective representatives, consultants, financial advisors, attorneys, accountants or other agents not to take, directly or indirectly, any action to solicit, encourage, initiate or engage in discussions or negotiations with, or provide any information to, or enter into any agreement with, any person (other than Buyer and its Affiliates and representatives) concerning any sale of the Shares or any equity securities of any Company Subsidiary or any merger, sale of substantial assets or similar transaction involving the Company or any Company Subsidiary (other than assets sold in the ordinary course of business).

SECTION 5.05Seller Assistance with Financing.  Prior to the Closing, Seller shall cause the Company and each of the Company Subsidiaries to reasonably cooperate with Buyer in connection with the arrangement of any debt financing as may be reasonably requested by Buyer (provided, that such requested cooperation does not unreasonably interfere with the ongoing operations of the Company and the Company Subsidiaries).  Such cooperation by the Company and Company Subsidiaries shall include, at the reasonable request of Buyer, the taking by the Company and Company Subsidiaries of all actions reasonably requested by Buyer to permit the consummation of such financing and to permit the proceeds thereof to be made available to Buyer at Closing, the preparation of, and executing and delivering, definitive financing

29

documents and customary closing certificates as may be required by the any debt or equity financing and other customary documents as may be reasonably requested by Buyer; (provided that no such documents or certificates shall be effective at any time prior to the Closing), and making the Company’s and the Company Subsidiaries’(but only to the extent the following persons are not Seller’s or Seller’s other Affiliates’) executive officers, senior management, representatives and advisors reasonably available to assist such financing sources and otherwise reasonably cooperating in connection with the consummation of such financing.  Notwithstanding anything in this Agreement to the contrary, neither the Company nor any of the Company Subsidiaries shall pay any commitment or other similar fee or incur any other liability or obligation in connection with such financing prior to the Closing.

SECTION 5.06Confidentiality.  During the period commencing on the Closing Date and ending on the second anniversary of the Closing Date, Seller agrees not to (and to cause its Affiliates not to) disclose to any third party or use (other than in connection with Seller’s compliance with any of its obligations under this Agreement or any other Transaction Document) any confidential information of the business of the Company, any Company Subsidiary or Buyer or any of Buyer’s Affiliates (including any such confidential information obtained by Seller or any of its Affiliates in performing services for Buyer pursuant to this Agreement or any other Transaction Document) in a manner that could reasonably be expected to adversely impact the operation of the businesses of the Company or any Company Subsidiary by Buyer.  In the event that Seller or any Affiliate of Seller is requested or required pursuant to written or oral question or request for information or documents in any legal proceeding, interrogatory, subpoena, civil investigation demand, or similar process to disclose any such confidential information, Seller will notify Buyer promptly of the request or requirement so that Buyer may seek an appropriate protective order or waive compliance with the provisions of this Section 5.06.  If, in the absence of a protective order or the receipt of a waiver hereunder, Seller or one of its Affiliates is, on the advice of counsel, compelled to disclose any confidential information or else stand liable for contempt, Seller or such Affiliate may disclose the confidential information; provided, however, that Seller shall use its reasonable best efforts to obtain, or cause such Affiliate of Seller to obtain, at the expense of Buyer, an order or other assurance that confidential treatment will be accorded to such portion of the confidential information required to be disclosed as Buyer shall designate.  The foregoing provisions of this Section 5.06 shall not apply to any confidential information that is (i) generally available to the public immediately prior to the time of disclosure unless such confidential information is so available due to the actions of a Seller or an Affiliate of Seller or (ii) required to be disclosed pursuant to Applicable Law.

ARTICLE VI

Representations and Warranties of Buyer

Buyer hereby represents and warrants to Seller as follows:

SECTION 6.01Authority.  Buyer is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware.  Buyer has all requisite corporate power and authority to enter into this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby.  All corporate acts and other proceedings

30

required to be taken by Buyer to authorize the execution, delivery and performance of this Agreement and any other Transaction Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby have been duly and properly taken.  This Agreement has been duly executed and delivered by Buyer and constitutes a legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms, subject to the Bankruptcy and Equity Exception.

SECTION 6.02No Conflicts: Consents.  The execution and delivery of this Agreement by Buyer does not, and the consummation of the transactions contemplated hereby and compliance with the terms hereof will not, conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or to loss of a material benefit under, or result in the creation of any Lien upon any of the properties or assets of Buyer or any subsidiary of Buyer under, any provision of (a) the Certificate of Incorporation or Bylaws of Buyer or the comparable governing instruments of any subsidiary of Buyer, (b) any material note, bond, mortgage, indenture, deed of trust, license, lease, contract, commitment, agreement or arrangement to which Buyer or any subsidiary of Buyer is a party or by which any of their respective properties or assets are bound, or (c) any judgment, order, or decree, or material statute, law, ordinance, rule or regulation applicable to Buyer or any subsidiary of Buyer or their respective properties or assets, other than, in the case of clauses (b) and (c) above, any such items that, individually or in the aggregate, would not have a material adverse effect on, or materially impair, the ability of Buyer to consummate the transactions contemplated hereby.  No material consent, approval, license, permit, order or authorization of, or registration, declaration or filing with, any Governmental Entity is required to be obtained or made by or with respect to Buyer or any of its subsidiaries or their respective Affiliates in connection with the execution, delivery and performance of this Agreement or the consummation of the transactions contemplated hereby, other than those that may be required solely by reason of Seller’s (as opposed to any other third party’s) participation in the transactions contemplated hereby.

SECTION 6.03Securities Act.  The Shares purchased by Buyer pursuant to this Agreement are being acquired for investment only and not with a view to any public distribution thereof, and Buyer shall not offer to sell or otherwise dispose of the Shares so acquired by it in violation of any of the registration requirements of the Securities Act of 1933, as amended.  Buyer is an “accredited investor” as defined in Regulation D promulgated by the United States Securities and Exchange Commission under the Securities Act of 1933, as amended

SECTION 6.04Actions and Proceedings, etc.  There are no (a) outstanding judgments, orders, injunctions or decrees of any Governmental Entity or arbitration tribunal against Buyer or any of its Affiliates, (b) lawsuits, actions or proceedings pending or, to the knowledge of Buyer, threatened against Buyer or any of its Affiliates, or (c) investigations by any Governmental Entity which are, to the knowledge of Buyer, pending or threatened against Buyer or any of its Affiliates, which, in the case of each of clauses (a), (b) and (c), have or could have a material adverse effect on, or materially impair, the ability of Buyer to consummate the transactions contemplated hereby.

SECTION 6.05Financing.  Buyer has delivered to Seller true and complete copies of the executed equity commitment letter, dated as of the date of this Agreement, from

31

Kinderhook Capital Fund IV, L.P. and Kinderhook Capital Fund IV-B, L.P. (collectively, “Sponsor Fund”), a copy of which is attached as Annex I hereto (the “Equity Financing Commitment”), pursuant to which Sponsor Fund has committed, subject to the terms thereof, to provide equity financing to Buyer (the “Equity Financing”).  Prior to the date of this Agreement, the Equity Financing Commitment has not been amended or modified, and the respective commitments contained in the Equity Financing Commitment have not been withdrawn or rescinded in any respect.  The Equity Financing Commitment is in full force and effect and is a legal, valid and binding obligation of Buyer and, to the knowledge of Buyer, the other parties thereto.  Subject to the immediately preceding and succeeding sentences, the Equity Financing Commitment, in the form so delivered, is in full force and effect as of the date of this Agreement.  Assuming, the Purchase Price equals $58,000,000, without giving effect to any adjustments pursuant to Sections 2.01 or 2.02, the Equity Financing Commitment is in an amount sufficient to fund the entire Purchase Price and provides that Seller is an intended third party beneficiary of the Equity Financing Commitment, and entitled to enforce the Equity Financing Commitment in accordance with the terms and conditions thereof.  The obligations to make the Equity Financing available to Buyer pursuant to the terms of the Equity Financing Commitment are not subject to any conditions other than the conditions set forth in the Equity Financing Commitment.  No person has any right to impose (and the Buyer has no obligation to accept) any condition to the Equity Financing other than as set forth in the Equity Financing Commitment, nor any reduction to the aggregate amount available under the Equity Financing Commitment (nor any term or condition which would have the effect of reducing the aggregate amount available under the Equity Financing Commitment).  As of the date of this Agreement, there are no side letters, understandings or other agreements or arrangements relating to the Equity Financing.  As of the date of this Agreement, (i) the Equity Financing Commitment has not been supplemented, modified or amended in any respect, (ii) no event has occurred which, with or without notice, lapse of time or both, would constitute a breach on the part of Buyer under the Equity Financing Commitment and (iii) the commitments contained in the Equity Financing Commitment have not been withdrawn, terminated or rescinded.  As of the date of this Agreement, Buyer (x) is not aware of any fact or occurrence that makes any of the assumptions, or the representations or warranties of Buyer, in the Equity Financing Commitment inaccurate in any material respect, (y) has no reason to believe that Buyer will be unable to satisfy on a timely basis any term or condition of closing to be satisfied by it or its Affiliates contained in the Equity Financing Commitment and (z) has no reason to believe that any portion of the Equity Financing required to consummate the transactions contemplated hereby will not be made available to Buyer on the Closing Date.  As of the date of this Agreement, there are no side letters, understandings or other agreements or arrangements relating to the Equity Financing.  As of the date of this Agreement, (i) the Equity Financing Commitment has not been supplemented, modified or amended in any respect, (ii) no event has occurred which, with or without notice, lapse of time or both, would constitute a breach on the part of Buyer under the Equity Financing Commitment and (iii) the commitments contained in the Equity Financing Commitment have not been withdrawn, terminated or rescinded.  Buyer has fully paid (or caused to be paid) any and all commitment fees or other fees required by the Equity Financing Commitment to be paid by it on or prior to the date of this Agreement and shall in the future pay any such fees as they become due pursuant to the Equity Financing Commitment.  The Equity Financing Commitment, when funded, will provide Buyer with financing at Closing sufficient to satisfy all of Buyer’s obligations under this Agreement, including the consummation of the purchase and sale of the Shares and the other

32

transactions contemplated by this Agreement and the other Transaction Documents upon the terms set forth herein and therein, including the payment in full of the Closing Date Amount and all related fees and expenses associated with the foregoing.  Buyer acknowledges that its obligations under this Agreement are not conditioned upon or subject to its receipt of the proceeds made available under the Equity Financing Commitment or any alternative financing.

SECTION 6.06Guaranty.  Concurrently with the execution of this Agreement, Buyer has delivered to Seller the duly executed Limited Guaranty between Sponsor Fund (the “Guarantor”), a copy of which is attached as Annex II hereto (the “Guaranty”) providing for, among other things, the payment in full of the Purchase Price.  The Guaranty is in full force and effect as of the date hereof and constitutes a valid and binding obligation of the Guarantor, enforceable against the Guarantor in accordance with its terms, subject to the Bankruptcy and Equity Exceptions.  No event has occurred which, with or without notice, lapse of time or both, would or would reasonably be expected to constitute a default or breach on the part of the Guarantor under the Guaranty.

SECTION 6.07Solvency.  Assuming that (i) the representations and warranties of Seller contained in this Agreement are true and correct in all material respects (and, solely for purposes of this Section 6.07, without giving effect to any limitation or qualification as to materiality or Material Adverse Effect or other terms of similar import or effect), (ii) the Company and Company Subsidiaries are Solvent immediately prior to the Closing and (iii) the performance of all obligations and compliance with all covenants and agreements required by this Agreement to be performed or complied with at or prior to the Closing by Seller in all material respects, immediately after the Closing and after giving effect to the transactions contemplated by this Agreement, the payment of the Closing Date Amount and the payment of all fees and expenses related to the transactions contemplated by this Agreement, each of the Company and the Company Subsidiaries will be Solvent.

ARTICLE VII

Covenants of Buyer

Buyer covenants and agrees as follows:

SECTION 7.01Confidentiality.

(a)Buyer acknowledges that the information being provided to it in connection with the purchase and sale of the Shares and the consummation of the other transactions contemplated hereby is subject to the terms of a confidentiality agreement between Buyer and Seller (the “Confidentiality Agreement”), the terms of which are incorporated herein by reference.  Effective upon, and only upon, the Closing, the Confidentiality Agreement shall automatically terminate and be of no further force or effect except solely with respect to any and all other information provided to Buyer by or on behalf of Seller or Seller’s representatives concerning Seller and its Affiliates (other than the Company and the Company Subsidiaries) which information shall remain subject to the terms and conditions of the Confidentiality Agreement after the Closing Date.

33

(b)During the period commencing on the Closing Date and ending on the second anniversary of the Closing Date, Buyer agrees not to (and to cause its subsidiaries, and its Affiliates that received any Seller Confidential Information from Buyer or its subsidiaries after the Closing, not to) disclose to any third party or use (other than in connection with Buyer’s compliance with any of its obligations under this Agreement or any other Transaction Document) any confidential information to the extent relating solely to the business of Seller or any of Seller’s Affiliates (the “Seller Confidential Information”), except as may be required by Applicable Law.  Seller acknowledges that the Seller Confidential Information may serve to give Buyer a deeper overall knowledge and understanding of Seller’s and its Affiliates’ industries and their businesses in a way that cannot be separated from Buyer’s other knowledge. Subject to the foregoing, Seller acknowledges that nothing contained herein shall prevent Buyer or any of its subsidiaries from conducting their businesses, now or in the future, in the industries in which Seller and its Affiliates operate.  Nothing in this Section 7.01(b) shall in any way restrict the ability of Buyer or any of its subsidiaries to engage in any line of business or to compete with the Seller and its Affiliates in any industry.

SECTION 7.02No Additional Representations.  Buyer acknowledges (on behalf of itself and its Affiliates) that, to its knowledge, it and its representatives have received or been afforded the opportunity to review prior to the date hereof all written materials which Seller was required to deliver or make available, as the case may be, to Buyer pursuant to this Agreement on or prior to the date hereof.  Buyer acknowledges (on behalf of itself and its Affiliates) that, to its knowledge, it and its representatives have been permitted full and complete access to the books and records, facilities, equipment, tax returns, contracts, insurance policies (or summaries thereof) and other properties and assets of the Company and the Company Subsidiaries that it and its representatives have desired or requested to see and/or review, and that, to its knowledge, it and its representatives have had a full opportunity to meet with the partners, officers and employees of Seller, the Company and the Company Subsidiaries to discuss the businesses and assets of the Company and the Company Subsidiaries.  Buyer acknowledges and agrees (on behalf of itself and its Affiliates) that, other than in the case of fraud or willful misrepresentation in connection therewith, (i) except as expressly set forth in this Agreement or the Seller Disclosure Schedule, none of Seller, the Company, or any other person has made any representation or warranty, expressed or implied, with respect to the transactions contemplated by this Agreement or as to the accuracy or completeness of any information regarding the Company and the Company Subsidiaries furnished or made available to Buyer and its representatives, including any projections, estimates or budgets delivered to or made available to Buyer of future revenues, future results of operations (or any component thereof), future cash flows or future financial condition (or any component thereof) of the Company and any Company Subsidiary or the future business and operations of the Company and any Company Subsidiary, (ii) Buyer and its Affiliates have not relied on any representation or warranty from Seller, the Company or any other person with respect to the Company, the Shares, the business of the Company or the Company Subsidiaries or any other matter, except for the representations and warranties expressly set forth in this Agreement, (iii) none of Seller, the Company or any other person shall have or be subject to any liability to Buyer or any other person resulting from the distribution to Buyer, or Buyer’s use of, any such information and any information, documents or material made available to Buyer in certain “data rooms”, management presentations or in any other form in expectation of the transactions contemplated hereby and (iv) SHOULD THE CLOSING OCCUR, THE SHARES (AND THEREFORE THE COMPANY

34

AND THE COMPANY SUBSIDIARIES) ARE ACQUIRED BY BUYER WITHOUT ANY REPRESENTATION OR WARRANTY AS TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, IN AN “AS IS” CONDITION AND ON A “WHERE IS” BASIS.  Notwithstanding anything to the contrary set forth in this Agreement or otherwise, all representations and warranties in this Agreement or in any certificate or other writing delivered pursuant this Agreement of the parties speak as of the date hereof and as of the Closing Date, subject to Sections 3.01(a), 3.01(g) and 3.02(a), and do not speak as of any other date (except to the extent such representations and warranties by their terms speak as of an earlier date, then such representations and warranties shall speak as of such earlier date; provided, however, that such earlier date shall not be earlier than June 18, 2014).

SECTION 7.03No Use of Certain Names.  Buyer shall cause the Company and the Company Subsidiaries promptly, and in any event (a) within ninety (90) days after Closing, to revise product and service literature and labeling to delete all references to the Names and (b) within ninety (90) days after Closing, to change signing and stationery and otherwise discontinue use of the Names; provided, however, that for a period of ninety (90) days from the Closing Date the Company and the Company Subsidiaries may continue to distribute product and service literature that uses any Names and distribute products and services with labeling that uses any Names to the extent that such product and service literature and labeling exists on the Closing Date.  In no event shall Buyer or the Company or any of the Company Subsidiaries use any Names after the Closing in any manner or for any purpose different from the use of such Names by the Company and the Company Subsidiaries during the sixty (60) day period preceding the date hereof. “Names” means “US Ecology” and “EQ”, any variations and derivatives thereof and any other logos or trademarks of Seller or its Affiliates (other than the Company and the Company Subsidiaries) not included in Section 4.12 of the Seller Disclosure Schedule.

SECTION 7.04Buyer Activity on Closing Date.  On the Closing Date, Buyer shall not permit the Company or any of the Company Subsidiaries to effect any extraordinary transactions (other than any such transactions expressly required by Applicable Law or by this Agreement) that could result in Tax liability to the Company or any of the Company Subsidiaries in excess of Tax liability associated with the conduct of its business in the ordinary course.

ARTICLE VIII

Mutual Covenants

Each of Seller and Buyer covenants and agrees as follows:

SECTION 8.01Consents.  Buyer acknowledges that the consents and waivers listed on Section 4.02 of the Seller Disclosure Schedule (all such consents and waivers excluding any consents, waivers or notices relating to ISRA or any other material regulatory or governmental approval required as a condition to Closing pursuant to Section 3.01), the “Scheduled Consents”) may be required with respect to the transactions contemplated by this Agreement, and that such consents and waivers have not been obtained.  Buyer agrees that Seller shall not have any liability whatsoever to Buyer arising out of or relating to the failure to obtain any Scheduled Consent or because of the termination of any Contract with respect to a Scheduled Consent, as a result thereof.  Buyer further agrees that no representation, warranty or

35

covenant of Seller contained herein shall be breached or deemed breached, and no condition shall be deemed not satisfied, as a result of (a) the failure to obtain any Scheduled Consent, (b) any termination of a Contract with respect to a Scheduled Consent or (c) any lawsuit, action, proceeding or investigation commenced or threatened by or on behalf of any person arising out of or relating to the failure to obtain any Scheduled Consent.  Prior to the Closing, Seller shall, and shall cause the Company and the Company Subsidiaries to, cooperate with Buyer, upon the request of Buyer, in any reasonable manner in connection with Buyer obtaining any Scheduled Consent; provided, however, that such cooperation shall not include any requirement of Seller or any of its Affiliates (including the Company and the Company Subsidiaries) to expend money, commence, defend or participate in any litigation or offer or grant any accommodation (financial or otherwise) to any third party.

SECTION 8.02Cooperation.  Buyer and Seller shall cooperate with each other, and shall cause their officers, employees, agents, auditors and representatives to cooperate with each other, for a period of sixty (60) days after the Closing to ensure the orderly transition of the Company and the Company Subsidiaries from Seller to Buyer and to minimize any disruption to the respective businesses of Seller, Buyer, the Company and the Company Subsidiaries that might result from the transactions contemplated hereby.  Each party shall reimburse the other for reasonable out-of-pocket costs and expenses incurred in assisting the other pursuant to this Section 8.02.  Neither party shall be required by this Section 8.02 to take any action that would unreasonably interfere with the conduct of its business or unreasonably disrupt its normal operations (or, in the case of Buyer, the business or operations of the Company and the Company Subsidiaries).

SECTION 8.03Publicity.  Seller and Buyer agree that, from the date hereof through the Closing Date, no public release or announcement concerning the transactions contemplated hereby shall be issued by either party without the prior consent of the other party (which consent shall not be unreasonably withheld), except (i) as such release or announcement may be required by law or the rules or regulations of any United States or foreign securities exchange, in which case the party required to make the release or announcement shall allow the other party reasonable time to comment on such release or announcement in advance of such issuance and (ii) such release or announcement that has been provided to the non-releasing party for review and comment a reasonable period of time prior to any such release or announcement being issued for review and comment (with any such reasonable comments to be considered in good faith by the releasing party); provided, however, that no such release or announcement may include any disparaging statement about the Company, the Company Subsidiaries or their respective businesses; provided, further, that any information previously included in any public release or announcement by a party may be disclosed by the either party hereto without the consent of the other party.

SECTION 8.04Reasonable Best Efforts.  Subject to the terms and conditions of this Agreement (including the provisions set forth in Section 8.01), each party shall use its reasonable best efforts to cause the Closing to occur, including obtaining all approvals under ISRA to consummate the transactions contemplated by this Agreement and completing all Pre-Closing Transfers.  Without limiting the foregoing, each of Buyer and Seller shall use its respective reasonable best efforts to cause the Closing to occur as promptly as practicable after the date hereof, including satisfaction of the conditions set forth in Article III.  Each of Seller and

36

Buyer shall not, and shall not permit any of its respective Affiliates to, take any action that would, or that could reasonably be expected to, result in any of the conditions set forth in Article III not being satisfied.

SECTION 8.05Records.  (a) As soon as practicable on or after the Closing Date, Seller shall deliver or cause to be delivered to Buyer all material original agreements, documents, books, records and files, including records and files stored on computer disks or tapes or any other storage medium (collectively, “Records”), if any, in the possession of Seller and its Affiliates (other than the Company and the Company Subsidiaries) relating to the business and operations of the Company and the Company Subsidiaries to the extent not then in the possession of the Company and the Company Subsidiaries, subject to the following exceptions:

(b)Buyer recognizes that certain Records may contain incidental information relating to the Company and the Company Subsidiaries or may relate primarily to subsidiaries or divisions of Seller other than the Company and the Company Subsidiaries and that Seller may retain such Records and shall provide copies of the relevant portions thereof to Buyer; and

(c)Seller may retain all Records prepared in connection with the sale of the Shares, including bids received from other parties and analyses relating to the Company and the Company Subsidiaries.

(d)After the Effective Time, upon reasonable written notice, Buyer and Seller agree to furnish or cause to be furnished to each other and their representatives, employees, counsel and accountants access, during normal business hours, such information (including Records pertinent to the Company and the Company Subsidiaries) and assistance relating to the Company and the Company Subsidiaries as is reasonably necessary for financial reporting, tax matters and accounting matters; provided, however, that such access does not unreasonably disrupt the normal operations of Seller, Buyer, the Company or any of the Company Subsidiaries.

SECTION 8.06Financing.

(a)Buyer shall use its reasonable best efforts to arrange the Equity Financing as promptly as practicable, on the terms and conditions described in the Equity Financing Commitment, including using reasonable best efforts to (i) negotiate and finalize definitive agreements with respect thereto on the terms and conditions contained therein or on other terms acceptable to Buyer, (ii) satisfy on a timely basis all conditions applicable to Buyer in the Equity Financing Commitment, (iii) comply with its obligations under the Equity Financing Commitment and consummate the Equity Financing no later than the Closing and (iv) enforce its rights under the Equity Financing Commitment.  At any time that Seller would be entitled to seek and obtain specific performance to enforce Buyer’s obligations to cause the Equity Financing to be funded in order to consummate the purchase and sale of the Shares and the other transactions contemplated by this Agreement and the other Transaction Documents pursuant to Section 15.04, Buyer shall use its reasonable best efforts to cause the persons providing the Equity Financing to fund the Equity Financing required to consummate the purchase and sale of the Shares and the other transactions contemplated by this Agreement on the Closing Date (including by taking enforcement action to cause such persons providing such

37

Equity Financing to fund such Equity Financing).  In the event any portion of the Equity Financing becomes unavailable on the terms and conditions contemplated in the Equity Financing Commitment, Buyer shall promptly notify Seller and shall use its commercially reasonable efforts to arrange to obtain alternative financing from alternative sources on terms that will still enable Buyer to consummate the purchase and sale of the Shares and the other transactions contemplated by this Agreement as promptly as practicable following the occurrence of such event.  Buyer shall deliver to Seller true and complete copies of all agreements pursuant to which any such alternative source shall have committed to provide Buyer with any portion of such alternative financing (other than fee letters, engagement letters or other agreements that, in ordinary practice, are confidential by their terms).

(b)Prior to the Closing, Buyer shall not agree to or permit any amendment, supplement or other modification of, or waive any of its rights under, the Equity Financing Commitment or the definitive agreements relating to the Equity Financing without first obtaining Seller’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed.  Buyer shall give Seller prompt notice (i) of any material breach or default by any other party to the Equity Financing Commitment or any event or circumstance that makes a condition precedent to the Equity Financing unable to be satisfied, in each case, of which Buyer becomes aware, or any termination of the Equity Financing Commitment, (ii) of the receipt of any written notice or other written communication from any other party to the Equity Financing Commitment with respect to any actual or threatened material breach, material default, withdrawal, termination or repudiation by any other party to any Equity Financing Commitment, (iii) of any material written dispute or disagreement between or among Buyer and any of the other parties to the Equity Financing Commitment, and (iv) if for any reason Buyer believes in good faith that it will not be able to timely obtain all or any portion of the Equity Financing on the terms, in materially the same manner or from the sources contemplated by the Equity Financing Commitment.  Buyer shall keep Seller informed on a reasonably current basis in reasonable detail of the status of its efforts to arrange the Equity Financing and provide to Seller copies of all material documents related to the Equity Financing, other than any agreements subject to confidentiality (except to the extent such agreements relate to the amounts or conditionality of, or contain any conditions precedent to, the funding of the Equity Financing).  For the avoidance of doubt, failure to obtain all or any portion of the Equity Financing (or any alternative financing) shall not in and of itself relieve or alter the obligations of Buyer to consummate the purchase and sale of the Shares and the other transactions contemplated by this Agreement and the other Transaction Documents upon the terms set forth herein and therein.

(c)Notwithstanding anything to the contrary contained in this Agreement, nothing contained in this Section 8.06 shall require Buyer to, (i) only in the event Seller would not be entitled to seek and obtain specific performance to enforce Buyer’s obligations to cause the Equity Financing to be funded in order to consummate the purchase and sale of the Shares and the other transactions contemplated by this Agreement and the other Transaction Documents pursuant to Section 15.04, bring any enforcement action against any other party to the Equity Financing Commitment or any other provider of alternative financing to enforce its rights under the Equity Financing Commitment or other agreement pursuant to which any alternative financing commitment is made, (ii) seek the Equity Financing or any alternative financing in any amount in excess of that contemplated by the Equity Financing Commitment or (iii) pay

38

any fees in excess of those contemplated by the Equity Financing Commitment (whether to secure waiver of any conditions contained therein or otherwise.

SECTION 8.07Employee Matters.

(a)Employees.  Prior to the Closing Date, the Seller or one of its Affiliates shall transfer the employment of the employees listed on Section 8.07(a)(i) of the Seller Disclosure Schedule, to the Company or a Company Subsidiary.  Prior to the Closing Date, the Seller or one of its Affiliates shall transfer the employment of the employees listed on Section 8.07(a)(ii) of the Seller Disclosure Schedule, from the Company or a Company Subsidiary to the Seller or one of its Affiliates (other than the Company or a Company Subsidiary).  Each employee of the Company and the Company Subsidiaries on the Closing Date shall be referred to as a “Continuing Employee.”

(b)Multiemployer Plans.  Buyer and the Seller hereby agree that the Closing of the transaction contemplated by this Agreement shall be a change in corporate structure within the meaning of Section 4218 of ERISA that will not trigger withdrawal liability, and that there will be no interruption in employer contributions or obligations to contribute under the Multiemployer Plans in which the Company participates as a result of the transaction contemplated by this Agreement.  Buyer and the Seller hereby agree to cooperate with each other and any applicable Multiemployer Plan in which Seller or one of its Affiliates (other than the Company or a Company Subsidiary) will continue to be a contributing employer after the Closing Date to apportion the contribution history of the Seller and its Affiliates among the Seller and Buyer in a reasonable manner.  Buyer and Seller hereby further agree that Seller or one of its Affiliates (other than the Company or a Company Subsidiary) shall retain all Multiemployer Plan liabilities for any Affiliate of Seller (other than the Company or a Company Subsidiary) that is a contributing employer to any Multiemployer Plan.

(c)Seller Plans.  Except as provided in Section 8.09, effective as of the Closing Date, the Company and any Company Subsidiary shall cease to be participating employers in the Seller Plans, and the Continuing Employees shall have no further rights to participate in the Seller Plans as active employees after the Closing Date.  Neither Buyer nor the Company shall have any liability with respect to any Seller Plan.

(d)Nothing in this Agreement shall limit the ability of Buyer or any of their Affiliates to terminate the employment of any Continuing Employee at any time following the Closing Date and for any reason, including without cause.

(e)Prior to or on the Closing Date, Seller shall (i) make all required contributions with respect to the Continuing Employees’ contributions to the US Ecology, Inc. 401(k) Savings and Retirement Plan 401(k) plan (the “Seller Savings Plan”) and (ii) fully vest the employer accounts of Continuing Employees in the Seller Savings Plan.  As soon as practical after the Closing Date, Buyer shall establish a savings plan to be qualified under Section 401(a) of the Code (the “Buyer Savings Plan”).  Continuing Employees shall be permitted to elect a rollover of their accounts from the Seller Savings Plan to the Buyer Savings Plan, and such rollover shall include plan loans evidencing outstanding plan loans.

39

(f)As of the Closing Date, Buyer shall allow eligible Continuing Employees to participate in Buyer’s flexible benefits plan and Seller shall spin-off the health care and dependent care account balances (and related assets and liabilities) and participant elections under the Seller’s flexible benefit plan with respect to Continuing Employees to the Buyer’s flexible benefits plan.

(g)Seller shall become and remain solely responsible and liable for satisfying the continuation coverage requirements for group health plans under Part 6 of Subtitle B of Title I of ERISA and Section 4980B of the Code for all employees of the Company or any Company Subsidiary who have terminated employment on or prior to the Closing Date (and their respective beneficiaries and dependents) and for all Continuing Employees (and their respective beneficiaries and dependents) who are entitled to elect such coverage on account of a qualifying event occurring on or before the Closing Date.

(h)Nothing in this Section 8.07, express or implied, shall create a third party beneficiary relationship or otherwise confer any benefit, entitlement, or right upon any person or entity other than the parties hereto, or create or establish any employee benefit plan or any amendment thereto.

SECTION 8.08Release.  Notwithstanding anything contained herein to the contrary, in consideration of the execution, delivery and performance by Seller and Buyer of this Agreement, effective as of the Closing, (i) Seller on behalf of itself and each of its past, present and future Affiliates (other than the Company and the Company Subsidiaries), beneficiaries, successors and assigns and their respective officers, directors, partners, members, trustees, employees and equityholders (“Seller Releasing Parties”) hereby RELEASES, WAIVES, ACQUITS AND FOREVER DISCHARGES Buyer, the Company and each Company Subsidiary and each of Buyer’s past present and future Affiliates, beneficiaries, successors and assigns and their respective officers, directors, partners, members, trustees, employees, equityholders, agents, attorneys and representatives (each, a “Buyer Released Party”), from any and all claims, demands, Proceedings, orders, losses, Liens, causes of action, suits, obligations, Contracts, agreements (express or implied), debts and liabilities, of whatever kind or nature, whether in law or equity, that any Seller Releasing Party ever had or may now have against any Buyer Released Party to the extent related to the Company or any Company Subsidiary or Seller’s ownership of the Shares or equity interests of any Company Subsidiary, whether known or unknown, suspected or unsuspected, that have accrued prior to the Closing or that accrue at or after the Closing as a result of any act, circumstance, occurrence, transaction, event or omission on or prior to the Closing Date, whether based on Contract or any Applicable Law in any jurisdiction and (ii) Buyer on behalf of itself and each of its past, present and future Affiliates, beneficiaries, successors and assigns and their respective officers, directors, partners, members, trustees, employees and equityholders (“Buyer Releasing Parties”) hereby RELEASES, WAIVES, ACQUITS AND FOREVER DISCHARGES Seller and each of Seller’s past present and future Affiliates, beneficiaries, successors and assigns and their respective officers, directors, partners, members, trustees, employees, equityholders, agents, attorneys and representatives (each, a “Seller Released Party”), from any and all claims, demands, Proceedings, orders, losses, Liens, causes of action, suits, obligations, Contracts, agreements (express or implied), debts and liabilities, of whatever kind or nature, whether in law or equity, that any Buyer Releasing Party ever had or may now have against any Seller Released Party to the extent related to the Company

40

or any Company Subsidiary, whether known or unknown, suspected or unsuspected, that have accrued prior to the Closing or that accrue at or after the Closing as a result of any act, circumstance, occurrence, transaction, event or omission on or prior to the Closing Date, whether based on Contract or any Applicable Law in any jurisdiction.  It is the intention of Seller and Buyer that such release be effective as a bar to each and every claim, demand, cause of action, suit or similar action hereinabove specified.  In furtherance of this intention Seller, on behalf of itself and its Affiliates, and Buyer, on behalf of itself and its Affiliates, hereby expressly waives, effective as of the Closing, any and all rights and benefits conferred upon it by the provisions of Applicable Law and expressly consents that this release will be given full force and effect according to each and all of its express terms and provisions, including those related to unknown and unsuspected claims, demands and causes of action, if any, as those relating to any other claims, demands and causes of action hereinabove specified, but only to the extent such section is applicable to releases such as this.  Notwithstanding the foregoing, nothing in this Section 8.08 shall or be deemed to release any rights or obligations of any Seller Releasing Party or any Buyer Releasing Party (a) pursuant to and subject to the terms of this Agreement including, without limitation, Section 8.07 and Article XI hereof; or (b) pursuant to and subject to the terms of any Transaction Document to which such Seller Releasing Party or Buyer Releasing Party, as the case may be, is a party.

SECTION 8.09Transition Services.

(a)After the Closing Date, Seller shall use commercially reasonable efforts to provide, or shall cause its Affiliates or third parties designated by it (such designated Affiliates and third parties, together with Seller, the “Service Providers”) to use commercially reasonable efforts to provide to Buyer, the Company and the Company Subsidiaries commercially reasonable transition services relating to information technology (including forwarding emails from the email accounts used by the Company and the Company Subsidiaries, including such email accounts using @eqonline.com and @usecology.com) (“IT Services”), human resources (“Human Resource Services”) and accounting and financing (“Accounting Services” and together with IT Services and Human Resource Services, the “Services”)).  The Services shall (i) be provided only in a manner that is substantially similar in all material respects to the manner in which the Services were performed for the Company and the Company Subsidiaries (a) immediately prior to the Closing Date and (b) during the period of US Ecology, Inc.’s ownership of the Company and the Company Subsidiaries, and (ii) Buyer, the Company and the Company Subsidiaries shall use the Services for substantially the same purposes and in substantially the same manner as the Company and the Company Subsidiaries had used the Services (x) immediately prior to the Closing Date and (y) during the period of US Ecology, Inc.’s ownership of the Company and the Company Subsidiaries.  Buyer shall use its reasonable best efforts to reduce or eliminate its dependency on the Services as soon as is reasonably practicable following the Closing Date; provided that the Service Providers shall have no obligation to provide the Services after the date that is six (6) months following the Closing Date.  In providing the Services, each of Seller and the other Service Providers shall act solely as an independent contractor and not as an agent of Buyer, the Company or the Company Subsidiaries.

(b)For the period between the Closing Date and the date that is three (3) months after the Closing Date, the Services provided by the Service Providers to Buyer, the Company

41

and the Company Subsidiaries shall be provided without charge or expense to Buyer, the Company or the Company Subsidiaries.  For the period between the date that is three (3) months after the Closing Date and the date that is six (6) months after the Closing Date (the “Payment Period”), Buyer, the Company and the Company Subsidiaries will reimburse Seller and the other Service Providers for providing the Services hereunder in amounts equal to $60,000 per month for the IT Services, $20,000 per month for the Human Resource Services and $20,000 per month for the Accounting Services, which such amounts shall be payable by Buyer, the Company and the Company Subsidiaries to Seller or the other Service Providers (as designated in writing by Seller) within 30-days of the first day of such month; provided, however, that if Buyer delivers a written notice to Seller at least five (5) business days prior to the first day of the Payment Period, or at least five (5) business days prior to the first day of any month in the Payment Period, stating, effective upon the first day of the Payment Period or the first day of a month during the Payment Agreement (as applicable), that each of the Service Providers is fully released from providing, and shall thereafter no longer be obligated to provide, the IT Services, the Human Resource Services or the Accounting Services, or all of the Services, to Buyer, the Company or any Company Subsidiary pursuant to this Section 8.09 (the “Service Termination Notice”), then the Service Providers shall cease providing the applicable Services set forth in the Service Termination Notice at the effective time of such Service Termination Notice and Buyer, the Company and the Company Subsidiaries shall have no further reimbursement obligations with respect to such applicable Services.

(c)Seller or any of the Service Providers shall not be liable for any interruption of Service or delay or failure to perform such Services if such interruption, delay or failure results from causes beyond its reasonable control, including any strikes, lockouts or other labor difficulties, acts of any government, riot, insurrection or other hostilities, embargo, fuel or energy shortage, fire, flood, lightning, earthquake, storm, hurricane, tornado, explosion, acts of God, pandemics, wrecks, transportation delays or inability to obtain necessary labor, materials or utilities.  In any such event, Seller’s and each Service Provider’s obligations under this Section 8.09 shall be postponed for such time as its performance is suspended or delayed on account thereof.  Seller will promptly notify Buyer, either orally or in writing, upon learning of the occurrence of such event of force majeure.  Upon the cessation of the force majeure event, Seller will use reasonable efforts to resume, or to cause any other relevant Service Provider to resume, its performance with the least practicable delay.

(d)Neither Seller nor any other Service Provider shall be liable, whether in contract, tort (including negligence and strict liability) or otherwise, for any special, indirect, incidental or consequential damages whatsoever which in any way arise out of, relate to or are a consequence of, the performance or nonperformance by it hereunder or the provision of, or failure to provide, any Service hereunder, including with respect to loss of profits, business interruptions or claims of customers.  Buyer agrees to indemnify and hold harmless each Service Provider from and against any such damages incurred thereby and any costs and expenses thereof arising therefrom.  In any event, the liability of Seller or any other Service Provider with respect to the Services and the obligations under this Section 8.09 or any act or failure to act in connection herewith (including, but not limited to, the performance or breach hereof), or from the sale, delivery, provision or use of any Service provided under or covered by this Section 8.09, whether in contract, tort (including negligence and strict liability) or otherwise, shall not exceed the reimbursement amounts previously paid to Seller or such other

42

relevant Service Provider by Buyer in respect of the Service from which such purported liability flows.

(e)After the Closing Date, Buyer shall use commercially reasonable efforts to provide, or shall cause the Company and the Company Subsidiaries, or third parties designated by it (such designated third parties, together with Buyer, the Company and the Company Subsidiaries, the “Buyer Service Providers”) to use commercially reasonable efforts to provide to Seller and its Affiliates commercially reasonable transition services relating to accounting and financing (“Buyer Accounting Services”).  Seller shall use its reasonable best efforts to reduce or eliminate its dependency on the Buyer Accounting Services as soon as is reasonably practicable following the Closing Date; provided that the Service Providers shall have no obligation to provide the Buyer Accounting Services after the date that is six (6) months following the Closing Date. For the period between the Closing Date and the date that is three (3) months after the Closing Date, the Buyer Accounting Services provided by the Buyer Service Providers to Seller and its Affiliates shall be provided without charge or expense to Seller or any of its Affiliates.  During the Payment Period, Seller will reimburse Buyer and the other Buyer Service Providers for providing the Buyer Accounting Services hereunder in an amount equal to $20,000 per month, which amount shall be payable by Seller to Buyer or the other Buyer Service Providers (as designated in writing by Buyer) within 30-days of the first day of such month; provided, however, that if Seller delivers a written notice to Buyer at least five (5) business days prior to the first day of the Payment Period, or at least five (5) business days prior to the first day of any month in the Payment Period, stating, effective upon the first day of the Payment Period or the first day of a month during the Payment Agreement (as applicable), that each of the Buyer Service Providers is fully released from providing, and shall thereafter no longer be obligated to provide, the Buyer Accounting Services to Seller pursuant to this Section 8.09 (the “Buyer Service Termination Notice”), then the Buyer Service Providers shall cease providing the Buyer Accounting Services at the effective time of such Service Termination Notice and Seller shall have no further reimbursement obligations with respect to the Buyer Accounting Services.

SECTION 8.10Fixed Pricing for Certain Services; Disposal Services.

(a)Until the one (1) year anniversary of the Closing Date, Seller shall, and shall cause its Affiliates to, continue to provide to the Company and Company Subsidiaries the products and services that are currently being provided by Seller and its Affiliates to the Company and the Company Subsidiaries as of the date hereof, for the same prices as such products and services are currently being provided to the Company and Company Subsidiaries as of the date hereof.

(b)Until the one (1) year anniversary of the Closing Date, Seller shall, and shall cause its Affiliates to, provide the Company and Company Subsidiaries with Seller’s and its Affiliates’ best broker pricing with respect to any new disposal services not being provided by Seller or any of its Affiliates to the Company or any of the Company Subsidiaries as of the date hereof (“Disposal Services”) offered by Seller or its Affiliates to any customer of Seller or its Affiliates during such period. Until the one (1) year anniversary of the Closing Date, Buyer shall cause the Company and Company Subsidiaries to provide Seller with a right of first refusal to provide (or for Seller’s Affiliates to provide) the Company and Company Subsidiaries

43

with Disposal Services; provided, that, if the Company or any of the Company Subsidiaries is able to obtain such disposal services from a third party at a total net cost (including cost of transportation) to the Company and Company Subsidiaries that is less than the total net cost (including cost of transportation) that the Company and/or Company Subsidiaries would incur if they accepted Seller’s or its Affiliate’s offer for Disposal Services, then Buyer, the Company and the Company Subsidiaries shall have no obligation to accept the offer (if any made by Seller or any of its Affiliates) for Disposal Services from Seller or any of its Affiliates and Buyer, the Company and the Company Subsidiaries shall be permitted to obtain such disposal services from the applicable third party.

ARTICLE IX

[INTENTIONALLY OMITTED]

ARTICLE X

Further Assurances

SECTION 10.01Further Assurances.  From time to time, as and when reasonably requested by either party hereto, the other party shall execute and deliver, or cause to be executed and delivered, all such documents and instruments and shall take, or cause to be taken, all such further or other actions (subject to the other provisions of this Agreement, including Sections 8.01 and 8.04), as such other party may reasonably deem necessary or desirable to consummate the transactions contemplated by this Agreement, all at the sole cost and expense of the requesting party.

ARTICLE XI

Environmental Matters.

SECTION 11.01ISRA and Environmental Matters.

(a)The Company shall, at its sole cost and expense (other than any fees, costs or expenses of Buyer, including legal fees and costs of Buyer), prior to or at Closing, generally undertake the requisite filings for the Rahway Site so as to allow for the Closing to occur in compliance with ISRA, including, but not limited to, the preparation and filing of an ISRA General Information Notice and a Remediation Certification, including as a Remediation Funding Source the Company’s existing Remediation Funding Source and pay any applicable Annual Surcharge Payment for the Rahway Site, to the extent such filings are required.  The Company shall file an ISRA General Information Notice within five (5) days of the execution of this Agreement.  The Company shall be listed as the responsible entity under such Remediation Certification.  Seller agrees to transfer to Buyer all rights and interest in funds remaining in the Remediation Funding Source established by the Company for the Rahway Site, currently valued at approximately one million, eight hundred thousand dollars ($1,800,000) to be used solely for remediation-related activities at the Rahway Site.  In exchange for such transfer, Buyer agrees that Seller shall have no further responsibility or liability whatsoever with regard to contamination at the Rahway Site; except for any contamination at the Rahway Site related to

44

any Releases of Hazardous Substances occurring from June 18, 2014 until the Closing Date.  Buyer and Seller shall cooperate and use commercially reasonable efforts to make the notice filings set forth on Section 11.01(a) of the Seller Disclosure Schedule within 5 days after the date hereof.

(b)After Closing, Buyer shall direct all activities of the Company relating to compliance with ISRA for the Rahway Site by the Company, including, if necessary, the filing of any and all required forms with NJDEP and other Governmental Entities.

(c)Any potential conflicts that may arise as to the current LSRP Michael Metlitz of the Whitman Companies, Inc. (“Whitman”) are hereby waived effective as of the Closing.  In the case of litigation related to this Agreement and/or the transactions contemplated by this Agreement, Metlitz and Whitman shall not be available to either party as its expert witness.

(d)After the Closing, the Company, as directed by the Buyer shall control and manage any Remedial Action (including, without limitation, hiring legal counsel, hiring an LSRP, conducting environmental investigations and cleanups, negotiating with NJDEP and other Governmental Entities and third parties and defending or settling claims and actions) and provide Seller with copies of all material communications respecting the Remedial Action.  After the Closing, the Company, as directed by the Buyer shall control all correspondence, discussions and negotiations with, and submissions to, NJDEP or any other Governmental Entity concerning, or that may affect, such Remedial Actions.

(e)The Company shall (i) prepare and file all documents (including permit transfers, modifications and applications) required to be submitted prior to the Closing Date by the Company to NJDEP pursuant to any Environmental Law in connection with the transactions contemplated by this Agreement, and (ii) use commercially reasonable efforts to obtain all consents, waivers, authorizations and approvals required by the Company from NJDEP pursuant to any Environmental Law in connection with the transactions contemplated by this Agreement.

(f)Prior to the Closing, the Company, Seller and Buyer agree to fully cooperate and work diligently in order to prepare and file with NJDEP or any other Governmental Entities any documents or petitions required by ISRA and Environmental Laws in connection with the provisions of this Article XI of this Agreement.  Prior to the Closing, Seller and Buyer shall have a reasonable opportunity to review and comment on any such document or petition prior to its filing after the date hereof and prior to or on the Closing Date with NJDEP or any other Governmental Entities in connection with the provisions of this Article XI.

(g)Buyer agrees (i) to be the responsible party and (ii) to not seek contribution or recovery from Seller or its Affiliates for all Pre-Acquisition Remediation Obligations, and Seller agrees (i) to be the responsible party and (ii) to not seek contribution or recovery from Buyer or its Affiliates for all Post-Acquisition Remediation Obligations.

45

ARTICLE XII

Tax Matters

SECTION 12.01Tax Returns.  Seller shall prepare and file (or caused to be prepared and filed) all income Tax Returns to be filed by or with respect to the Company and each Company Subsidiary for any taxable period beginning on or after June 18, 2014 and ending on or prior to the Closing Date (the “Pre-Closing Tax Period”) and shall pay all Taxes shown to be due and owing by or with respect to the Company or any Company Subsidiary thereon.  In the event that any Taxes payable by Seller pursuant to this Section 12.01 are required to be paid by the Company or a Company Subsidiary, Seller shall pay the amount of such Taxes over to the Company or the applicable Company Subsidiary at least five (5) business days prior to the due date for filing the applicable Tax Return.

SECTION 12.02Cooperation.  Each of Seller, the Company and Buyer shall reasonably cooperate, and shall cause their respective Affiliates, officers, employees, agents, auditors and representatives reasonably to cooperate, in preparing and filing all Tax Returns, including maintaining and making available to each other all records necessary in connection with Taxes and in resolving all disputes and audits with respect to all taxable periods relating to Taxes.  Buyer and Seller recognize that Seller and its Affiliates will need access, from time to time, after the Closing Date, to certain accounting and Tax records and information held by the Company and the Company Subsidiaries to the extent such records and information pertain to events occurring prior to the Closing Date; therefore, Buyer agrees, and agrees to cause the Company and the Company Subsidiaries, (a) to use their respective best efforts to properly retain and maintain such records until such time as Seller agrees that such retention and maintenance is no longer necessary, and (b) to allow Seller and its agents and representatives (and agents or representatives of any of its Affiliates), at times and dates mutually acceptable to the parties, to inspect, review and make copies of such records as Seller may deem necessary or appropriate from time to time, such activities to be conducted during normal business hours and at Seller’s expense.

SECTION 12.03Refunds and Credits.  Any refunds or credits of Taxes of the Company or any of the Company Subsidiaries for any Pre-Closing Tax Period received after the Closing shall, to the extent such Taxes were actually paid by the Company, any Company Subsidiary, Seller or any of their Affiliates prior to the Closing, be for the account of Seller.  Buyer shall, if Seller reasonably so requests, cause the Company and the Company Subsidiaries to file for and obtain any refunds or credits to which Seller is entitled under this Section 12.03.  Buyer shall cause the Company to forward to Seller any such refund within ten (10) days after the refund is received (or reimburse Seller for any such credit within ten (10) days after the credit is allowed or applied against other Tax liability).  This Section 12.03 shall not apply to any refund or credit of Taxes arising from the carryback, or other application, to any Pre-Closing Tax Period of any loss, credit or other Tax attribute arising after the Closing Date.

SECTION 12.04Transfer Taxes.  All transfer, documentary, sales, use, value added, registration and other such Taxes (including all applicable real estate transfer or gains Taxes) and related fees (including any penalties, interest and additions to Tax) (“Transfer Taxes”) incurred in solely as a result of the sale of the Shares pursuant to this Agreement shall be paid by Buyer,

46

and Buyer shall file all appropriate Tax Returns as may be required with respect to such Transfer Taxes; provided, that Seller shall pay all Transfer Taxes incurred in connection with the Pre- Closing Transfers and the Separation (as defined in Section 9.01) of Company Services from Shared Services Agreements and Seller shall file all appropriate Tax Returns as may be required with respect to such Transfer Taxes.  Seller and Buyer shall cooperate in timely making all Tax Returns as may be required to be filed in the preceding sentence.

SECTION 12.05FIRPTA Certificate.  Seller shall deliver to Buyer at the Closing a certificate substantially similar to the certificate described in Treasury Regulations Section 1.1445-2(b)(iv)(B) and reasonably acceptable to Buyer to the effect that Seller is not a non-U.S. person.

SECTION 12.06Buyer Activity Post-Closing.  Buyer shall not, with respect to any Pre-Closing Tax Period, (a) file any amended Tax return with respect to the Company or any of the Company Subsidiaries or (b) take or advocate any position with respect to Taxes of the Company or any of the Company Subsidiaries, in each case, that reasonably could be expected to adversely affect Seller.

ARTICLE XIII

Termination

SECTION 13.01Termination.  Anything contained herein to the contrary notwithstanding, but subject to Sections 3.03 and 3.04, this Agreement may be terminated and the transactions contemplated hereby abandoned at any time prior to the Closing Date:

(a)by mutual written consent of Seller and Buyer;

(b)by either party hereto upon written notice to the other party if any Governmental Entity shall have issued an order, decree or ruling or taken any other action permanently enjoining, restraining or otherwise prohibiting the transactions contemplated by this Agreement and such order, decree or ruling or other action shall have become final and nonappealable; provided, that the party seeking to terminate this Agreement pursuant to this Section 13.01(b) shall have used commercially reasonable efforts to remove such order, decree, ruling, judgment or injunction;

(c)by either party hereto upon written notice to the other party, if the Closing does not occur on or prior to the date that is one hundred eighty (180) days after the date hereof (and if such one hundred eightieth (180th) day is not a business day, then the next following business day) (the “End Date”); provided, however, that if on such 180th day the conditions set forth in Section 3.01(h) and/or Section 3.01(e) shall not have been satisfied or waived, then the End Date shall automatically be extended  one time by an additional 90 days (and such 90th day after the 180th day shall be the “End Date”);

(d)by Buyer upon written notice to Seller in the event of a breach by Seller of any representation, warranty, covenant or other agreement contained in this Agreement which (i) would give rise to the failure of the condition set forth in Section 3.01 and (ii) cannot be or has

47

not been cured within twenty (20) business days after the giving of written notice thereof to Seller by Buyer; or

(e)by Seller upon written notice to Buyer in the event of a breach by Buyer of any representation, warranty, covenant or other agreement contained in this Agreement which (i) would give rise to the failure of the condition set forth in Section 3.02 and (ii) cannot be or has not been cured within twenty (20) business days after the giving of written notice thereof to Buyer by Seller;

provided, however, that the party seeking termination pursuant to clause (c), (d) or (e) is not in breach in any material respect of any of its representations, warranties, covenants or agreements contained in this Agreement.

SECTION 13.02Return of Confidential Information.  If the transactions contemplated by this Agreement are terminated as provided herein:  all confidential information received by Buyer with respect to the businesses of Seller and its Affiliates (including the Company and the Company Subsidiaries) shall be treated in accordance with the Confidentiality Agreement, which shall remain in full force and effect in accordance with its terms notwithstanding the termination of this Agreement.

SECTION 13.03Consequences of Termination.  In the event of valid termination by Seller or Buyer pursuant to Article XIII, written notice thereof shall forthwith be given to the other party and the transactions contemplated by this Agreement shall be terminated, without further action by either party.  If this Agreement is validly terminated and the transactions contemplated hereby are abandoned as described in this Article XIII, this Agreement shall become void and of no further force or effect, except for the provisions of (a) Section 7.01, (b) Section 8.03, (c) this Article XIII and (d) Article XV (other than Section 15.10).  Nothing in this Article XIII shall be deemed to release either party from any liability for any willful and material breach of the terms and provisions of this Agreement or any fraud or intentional misrepresentation.

ARTICLE XIV

Non-Survival of Representations

SECTION 14.01Non-Survival of Representations.  None of (i) the representations or warranties or (ii) covenants or agreements to the extent which by their terms contemplate performance before the Closing, in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Closing.  This Section 14.01 shall not limit any covenant or agreement of the parties to the extent which by its terms contemplates performance after the Closing.

ARTICLE XV

Miscellaneous

SECTION 15.01Assignment.  This Agreement and the rights and obligations hereunder shall not be assignable or transferable by Buyer or Seller (including by operation of

48

law in connection with a merger, or sale of substantially all the assets, of Buyer or Seller) without the prior written consent of the other party hereto; provided, however, that no assignment shall limit or affect the assignor’s obligations hereunder.  Any attempted assignment in violation of this Section 15.01 shall be void.  Notwithstanding the foregoing, Buyer may (a) assign any or all of its rights and interests hereunder to one or more of its Affiliates and designate one or more of its Affiliates to perform its obligations hereunder, (b) assign its rights under this Agreement for collateral security purposes to any lenders providing financing to Buyer or its Affiliates, or (c) assign its rights under this Agreement to any person that, after the Closing, acquires, directly or indirectly, the Company or any Company Subsidiary; provided, however, that notwithstanding any such assignment, Buyer shall remain responsible and liable for all representations, warranties, liabilities, covenants, agreements and other obligations under and pursuant to the terms of this Agreement and, if such assignment is prior to the Closing, the Guaranty shall remain in full force and effect in accordance with its terms.

SECTION 15.02No Third Party Beneficiaries.  This Agreement is for the sole benefit of the parties hereto and their permitted assigns and nothing herein expressed or implied shall give or be construed to give to any person, other than the parties hereto and such assigns, any legal or equitable rights hereunder; provided; however, that the Buyer Released Parties shall be third party beneficiaries with respect to Section 8.08, with the right to enforce Section 8.08.

SECTION 15.03Fees and Expenses.  Whether or not the purchase and sale of the Shares and the other transactions contemplated by this Agreement and the other Transaction Documents are consummated, and except as otherwise specifically provided in this Agreement (including in Section 6.05), all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs or expenses; provided, that as a point of clarity, all such costs and expenses of the Company and the Company Subsidiaries shall be the obligation of Seller.  If any Transaction Expenses are not included in the calculation and determination of Closing Date Amount and remain unpaid after the Closing, such Transaction Expenses shall be obligations of the Seller from and after the Closing, and the Seller shall promptly pay such Transaction Expenses to the obligees thereof.

SECTION 15.04Specific Performance.  The parties agree that irreparable damage would result and that the parties would not have any adequate remedy at law if any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached or threatened to be breached at or prior to the Closing.  It is accordingly agreed that the parties shall be entitled to equitable relief, without the proof of actual damages, including in the form of an injunction or injunctions or orders for specific performance (including causing Buyer to enforce its rights under any of the Equity Financing Commitments), subject to the other provisions of this Section 15.04, in addition to all other remedies available to the parties at law or in equity as a remedy for any such breach or threatened breach.  Each party agrees to waive any requirement for the security or posting of any bond in connection with any such equitable remedy; provided, however, that Seller shall be entitled to seek and obtain specific performance to enforce Buyer’s obligations to cause the Equity Financing to be funded in order to consummate the purchase and sale of the Shares and the other transactions contemplated by this Agreement and the other Transaction Documents only in the event that each of the following conditions has been satisfied: (a) the conditions set forth in Section 3.01 (other than conditions that by their nature are to be satisfied at the Closing and are expected to be

49

so satisfied at Closing) have been satisfied on the date the Closing should have been consummated pursuant to the terms of this Agreement but for the failure of the Equity Financing to be funded, and (b) Seller has irrevocably confirmed in writing to Buyer that if the Equity Financing is funded, then the Closing will occur.  If, prior to the End Date, any party brings any suit, action or proceeding, in each case in accordance with Section 15.12, to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof, the End Date shall automatically be extended by (A) the amount of time during which such suit, action or proceeding is pending, plus twenty (20) business days or (B) such other time period established by the court presiding over such suit, action or proceeding, as the case may be.

SECTION 15.05Amendments.  No amendment, modification or waiver in respect of this Agreement shall be effective unless it shall be in writing and signed by duly authorized officers of both parties hereto.

SECTION 15.06Notices.  All notices or other communications required or permitted to be given hereunder shall be in writing and shall be delivered by hand or sent via e-mail (provided, that such e-mail shall state that it is a notice delivered pursuant to this Section 15.06) or by prepaid telex, cable or telecopy or sent, postage prepaid, by registered, certified or express mail or reputable overnight courier service and shall be deemed given when so delivered by hand, sent via e-mail, telexed, cabled or telecopied, or if mailed, three (3) days after mailing (one (1) business day in the case of express mail or overnight courier service), as follows:

(a)if to Buyer,

ASPV Holdings, Inc.

c/o Kinderhook Industries, LLC

521 5th Avenue, 34th Floor

New York, NY 10175
Attention:  Robert Michalik; Corwynne Carruthers
Facsimile:  (212) 201-6790
E-mail:  rmichalik@kinderhook.com; ccarruthers@kinderhook.com

with a copy to (which shall not constitute notice to Buyer):

Kirkland & Ellis LLP
601 Lexington Avenue
New York, NY  10022
Attention:  Elazar Guttman

Facsimile:  (212) 446-6460
E-mail:  elazar.guttman@kirkland.com; and

(b)if to Seller,

US Ecology, Inc.

50

251 E. Front St., Suite 400
Boise, Idaho 83702
Attention:Wayne Ipsen, Vice President and Corporate Counsel
Facsimile:(208) 331-7900
E-mail: wayne.ipsen@usecology.com

with a copy to:

O’Melveny & Myers LLP
Two Embarcadero Center, 28th Floor
San Francisco, California 94111
Attention: Paul Scrivano, Esq.

Facsimile: (415) 984-8701
E-mail: pscrivano@omm.com

SECTION 15.07Interpretation; Exhibits and the Seller Disclosure Schedule; Definitions.  (a) The headings contained in this Agreement, in the Seller Disclosure Schedule, in any Exhibit or Schedule hereto and in the table of contents to this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.  The Seller Disclosure Schedule and all Exhibits, Annexes and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein.  Each party has participated in the drafting of this Agreement and there shall be no presumption of construing ambiguity against the drafting person of this Agreement or any provision hereof.  Any capitalized terms used in the Seller Disclosure Schedule or any Exhibit, Annex or Schedule annexed hereto but not otherwise defined therein, shall have the meaning as defined in this Agreement.  As used in this Agreement, the words “include”, “includes” or “including” shall be deemed followed by the words “without limitation”.  As used in this Agreement, the word “or” shall not be exclusive, unless the context explicitly provides otherwise.  The word “will” shall be construed to have the same meaning as the word “shall”.  The phrase “to the extent” shall mean the extent or degree to which a subject or thing extends, and shall not simply be construed to mean the word “if”.

(b)For all purposes hereof

“Affiliate” means, with respect to any specified person, any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person; and for the purposes of this definition, “control” when used with respect to any specified person means the power to direct the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

“Annual Surcharge Payment” means a one (1) % surcharge required on an annual basis for certain types of Remediation Funding Sources.

“business day” means a day, other than Saturday, Sunday or other day on which commercial banks in New York, New York or Boise, Idaho are authorized or required by Applicable Law to close.

51

“CapEx Adjustment” means an amount equal to the total amount of all growth capital expenditures made by or on behalf of (including any growth capital expenditures made by Seller for or on behalf of) the Company and the Company Subsidiaries for the period beginning on the date of this Agreement and ending as of the Effective Time approved or consented to in writing by Buyer).

“Cash” means, as of any time of determination, the sum of the fair market value of all (expressed in United States dollars) cash and cash equivalents (including marketable securities and short term investments) of the Company and Company Subsidiaries, net of any overdrafts, as increased or decreased for any deposits in transit and any outstanding checks, subject to the subsequent provisions of this definition.  Cash shall not include any cash that is restricted in any way as to its use that could reasonably be expected to result in the Company and Company Subsidiaries not having the right to have sole control over such cash or cash equivalents within thirty (30) days of the Closing (e.g., cash held in escrow for indemnification purposes or subject to other limitations on spending and/or use) (other than the escrow account related to the ASPV Merger Agreement, the “Restricted Cash”).

“CERCLA” means the Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980.

“Closing Date Amount” means (i) the Purchase Price, plus or minus (ii) the amount by which Working Capital as of the close of the last complete fiscal month of the Company immediately prior to the fiscal month immediately preceding the month in which the Closing occurs (the “Estimated Working Capital”) (for purposes of clarity, if the Closing occurs on October 1, 2015, then for purposes of calculating Working Capital pursuant to this clause (ii) of the definition of “Closing Date Amount”, Working Capital would be calculated as of the close of August 2015) is greater than or is less than, as applicable, the WC Amount, plus (iii) the Estimated CapEx Adjustment, plus (iv) the Estimated Closing Cash, minus (v) the Estimated Closing Indebtedness, minus (vi) the Estimated Transactions Expenses.

“Code” means the U.S. Internal Revenue Code of 1986, as amended.

“Company Intellectual Property” means any Intellectual Property Right that is owned, used or held for use by the Company or any Company Subsidiary.

“Company Registered Intellectual Property” means all of the Registered Intellectual Property owned by, registered to, or filed in the name of, the Company or any Company Subsidiary.

“Contract” means any written legally binding agreement, contract, deed, mortgage, lease, sublease, license, sublicense, deed, instrument, note, indenture, or other legally binding commitment, undertaking or arrangement.

“Environmental Claim” means any suit, action, cause of action, claim, demand, litigation, complaint, grievance, litigation matter, including any hearing, or legal, administrative or arbitral proceeding before any court, arbitrator or Governmental Entity, in each case, pursuant to Environmental Laws.

52

“Environmental Laws” means any and all applicable statutes, laws (including common law), regulations, ordinances, rules, orders or decrees in any such case entered into, issued, or promulgated in final form prior to or as of the Closing Date by any Governmental Entity, relating to public or worker health or safety (regarding Hazardous Substances), pollution, protection of the environment, preservation or reclamation of natural resources, or to the management or Release of Hazardous Substances, including CERCLA, the Federal Water Pollution Control Act, the Clean Air Act of 1970, the Toxic Substances Control Act of 1976, the Emergency Planning and Community Right to Know Act of 1986, the Safe Drinking Water Act of 1974, the Hazardous Materials Transportation Act, and any similar or implementing state or local law, and all amendments thereto or regulations promulgated thereunder.

“Excluded Items” means (i) any obligations under operating leases, (ii) any liability, obligation, responsibility or requirement relating to the closure or post-closure care of a waste treatment, storage, disposal or management facility or unit, including without limitation any such requirement under 40 C.F.R. Part 264 or 265, (iii) any undrawn letters of credit, surety bonds, performance bonds or similar instruments, as well as any financial assurances relating to or in connection with the operations, site or remediation of the Rahway Site, (iv) any note or other indebtedness issued by the Company or any Company Subsidiary to any other Company Subsidiary or the Company, (v) trade payables incurred in the ordinary course of business reasonably consistent with past practice, (vi) any liability included in the determination of Working Capital and (vii) any liability included in Transaction Expenses.

“GAAP” means United States generally accepted accounting principles.

“General Information Notice” means an initial notice to NJDEP as required pursuant to ISRA.

“Hazardous Substance” means any hazardous or toxic material, substance or waste that is regulated or for which liability may be imposed pursuant to any Environmental Law.

“Indebtedness” of the Company and the Company Subsidiaries means as of any time of determination, without duplication, (i) liabilities of the Company or any Company Subsidiary for borrowed money indebtedness or indebtedness issued or incurred in substitution or exchange for borrowed money indebtedness, (ii) liabilities of the Company or any Company Subsidiary for borrowed money debt evidenced by any debt instrument or debt security, in any such case for borrowed money, (iii) liabilities of the Company or a Company Subsidiary for capitalized leases to the extent recorded as such on the Company’s or the Company Subsidiaries’ financial statements, if any, and (iv) liabilities of the Company or a Company Subsidiary pursuant to a guarantee guaranteeing any person’s obligations of the type described in clauses (i)-(iii) (in each case (i.e., in the case of clauses (i)-(iv), including all principal, interest, premiums, penalties, fees, expenses, indemnities and breakage costs).  Notwithstanding the foregoing, “Indebtedness” shall not include the Excluded Items.

“Intellectual Property Rights” means any or all worldwide rights, titles and interests in, arising out of, or associated in the following: (i) inventions (whether patentable or reduced to practice or not), patents and patent applications, industrial designs and industrial design applications, and patent disclosures, together with all reissues, continuations, continuations-in-

53

part, revisions, divisionals, extensions, and reexaminations in connection therewith; (ii) trade secrets and other proprietary or confidential information, including know-how, technologies, processes, techniques, protocols, methods, formulae, algorithms, compositions, industrial models, architectures, layouts, designs, drawings, plans, specifications, methodologies, ideas, research and development, technical data, customer and supplier lists, pricing and cost information, and business and marketing plans and proposals, (ii) software (including source code, object code, systems, tools, data, databases, firmware, and related documentation), (iii) copyrights and copyrightable works and other works of authorship, mask works, all databases and data collections and all rights therein, all moral rights of authors and inventors, however denominated, and all registrations, applications and renewals in connection therewith, and all other rights corresponding thereto, , (iv) trademarks, trade names, designs, trade dress, slogans, logos, service marks business names, corporate names, and other indicia of origin, and registrations, applications and renewals therefor, and all goodwill associated with any of the foregoing, and (v) all websites and domain names, (vi) other proprietary and intellectual property rights and any similar or equivalent rights to any of the foregoing anywhere in the world.

“ISRA” shall mean the Industrial Site Recovery Act, N.J.S.A. 13:1K-6 et seq.

“knowledge” means (i) with respect to Seller, the actual knowledge of Jeffrey Feeler, Eric Gerratt, Mario Romero, and Mathew Dahl, and (ii) with respect to Buyer, the actual knowledge of Corwynne Carruthers, Robert Michalik, Lou Galasso III and Donna Miller.

“L&L Guaranty” means the Company’s guarantee of the L&L Mortgage.

“L&L Mortgage” shall mean the mortgage against the Rahway Site granted by L&L Holdings, L.L.C. to Sovereign Bank dated September 24, 2003.

“Linden Site” means the site occupied by Allstate Power Vac, Inc., a New York corporation, at 1045 Pennsylvania Avenue in Linden, New Jersey.

“LSRP” shall mean the qualified individual who has been issued a valid license pursuant to the Site Remediation Reform Act, N.J.S.A. 58:10C-1, and the implementing regulations, and who has been engaged in that capacity by the Company or any Company Subsidiary with respect to pending ISRA case applicable to the Rahway Site.

“Material Adverse Effect” means any event, occurrence, fact, circumstance, condition, change in or effect that, individually or in the aggregate, with all other circumstances, conditions, changes in or effects on the Company and the Company Subsidiaries, has a material adverse effect on the results of operations, assets (whether tangible or intangible) or liabilities or the financial condition of the Company and the Company Subsidiaries, taken as a whole excluding any event, occurrence, fact, circumstance, condition, change in or effect relating to or arising from (i) any changes in applicable accounting regulations or principles, Applicable Laws or regulations (including laws or regulations relating to wrongful discharge, employment discrimination, harassment, minimum wage, workplace health and safety or related matters), (ii) any changes in interest rates or general (United States and/or the global) economic conditions, (iii) any changes in financial, banking or securities markets (including, without limitation, any disruption thereof and any decline in the price of any security or any market index), (iv) any

54

change generally applicable to the industries in which the Company or any Company Subsidiary operates, (v) any national or international political or social conditions, (vi) any failure by the Company or any Company Subsidiary to meet any internal or published projections, forecasts or revenue or earnings predictions for any period ending on or after the date hereof (it being understood that the reasons or circumstances giving rise to such failure may, unless otherwise excluded by another clause in this definition of “Material Adverse Effect,” be taken into account in determining whether a Material Adverse Effect has occurred or could reasonably be expected to occur), (vii) the entry into and consummation of the transactions contemplated by this Agreement, (viii) any action taken by Buyer, (ix) any action taken by the Company or any Company Subsidiary at the request or with the consent of Buyer or pursuant to this Agreement, any other Transaction Document or any other agreements entered in connection therewith, (x) any national or international political or social event or occurrence or material worsening or escalation thereof (including, without limitation, acts of war or terrorism), and (xi) any matters of which Buyer has actual (and not constructive) knowledge as of the date of this Agreement, in each case (i.e., clauses (i) through (v) and clause (x) above), only to the extent that such factors do not affect the Company and the Company Subsidiaries (taken as a whole) in a materially disproportionate manner as compared to their competitors.

“NJDEP” means the New Jersey Department of Environmental Protection.

“person” means any individual, firm, corporation, partnership, limited liability company, trust, joint venture, Governmental Entity or other entity.

“Post-Acquisition Remediation Obligations” means environmental investigatory, corrective or remedial obligations to the extent the facts, events or conditions underlying such obligations first arose or first existed between June 18, 2014 and the Closing Date, except to the extent Mr. Lou Galasso III had knowledge of any such obligations prior to the Closing Date.

“Pre-Acquisition Remediation Obligations” means environmental investigatory, corrective or remedial obligations (i) that existed on or prior to June 18, 2014, (ii) to the extent the facts, events or conditions underlying such obligations first arose or first existed from and after the Closing Date or (iii) to the extent that (a) Mr. Lou Galasso III had knowledge of any such obligations prior to the Closing Date and (b) Seller had no knowledge of any such obligations prior to Closing.

“Prime Rate” means the rate of interest from time to time publicly announced by Citibank, N.A. in its New York office as its prime or base rate, calculated on the basis of the actual number of days elapsed over three hundred sixty-five (365).

“Rahway Site” shall mean the site occupied by Allstate Power Vac, Inc., a New York corporation, located at 923 E. Hazelwood Avenue, Rahway, New Jersey.

“Registered Intellectual Property” means all United States, international and foreign: (i) patents and patent applications (including provisional applications); (ii) registered trademarks and applications to register trademarks; (iii) registered domain names; (iv) registered copyrights and applications for copyright registration; and (v) any other Intellectual Property Right that is

55

the subject of an application, certificate, filing, registration or other document issued, filed with, or recorded by any Governmental Entity.

“Release” and “Released” shall mean any release, spill, emission, leaking, pumping, pouring, emptying, escaping, dumping, injection, deposit, disposal, discharge, dispersal, leaching or migration into or through the indoor or outdoor environment or into, through or out of any property, including the movement of Hazardous Substances through or in the air, soil, surface water, ground water or property and the abandonment or discarding of barrels, containers and other closed receptacles containing any Hazardous Substance.

“Remedial Action” means all actions, whether voluntary or involuntary, to (i) clean up, remove, treat, cover or in any other way remediate any Release of, or contamination by, Hazardous Substances; (ii) prevent the Release of Hazardous Substances, including so that they do not migrate or endanger or threaten to endanger public health or welfare or the environment; or (iii) perform studies, investigations, and monitoring related to any Release, presence or potential presence of Hazardous Substances (including any post-remediation studies or monitoring); provided, however, that with respect to properties located in the State of New Jersey, including the Rahway Site, “Remedial Action” shall only include such actions described above to the extent required under Environmental Laws.

“Remediation Certification” means a certification pursuant to ISRA which, when submitted to the NJDEP by the owner or operator of an industrial establishment, authorizes the transfer of ownership of an ISRA subject property prior to the approval of a Response Action Outcome by an LSRP and identifies the party agreeing to be responsible for the conduct of the remediation.

“Remediation Funding Source” means any of the funding sources promulgated by NJDEP in N.J.A.C. 7:26C-7 et seq. as required for the filing of a Remediation Certification.

“Response Action Outcome” means a written determination by an LSRP substantially to the effect that, based on an evaluation of the historical use of the property and any other investigations or actions the LSRP deems necessary, there are no contaminants present at a property, or at any other site to which a Release originating at such property has migrated except for (i) contaminants that are not required by Environmental Law to be remediated, including, without limitation, by reason of the nature or extent of the contaminants and (ii) contaminants that have been remediated to the extent required by Environmental Laws.

“Seller Accounting Policies” means solely the principles used by the Company in the Working Capital Accounts.

“Solid Waste Utility Control Act” means the Solid Waste Utility Control Act of the State of New Jersey.

“Solid Waste Management Act” means the Solid Waste Management Act of the State of New Jersey.

“Solvent”, when used with respect to any person, means that, as of any date of determination, (a) the amount of the “fair saleable value” of the assets of such person (or group

56

of persons on a combined basis) on a going concern basis will, as of such date, exceed the amount that will be required to pay the probable liabilities of such person (or group of persons on a combined basis) on its existing debts (including contingent liabilities) as such debts become absolute and matured, (b) such person (or group of persons on a combined basis) will not have, as of such date, an unreasonably small amount of capital for the operation of the businesses in which it is engaged or proposed to be engaged following such date and (c) such person (or group of persons on a combined basis) will be able to pay its liabilities, including contingent and other liabilities, as they mature.  For purposes of this definition, each of the phrases “not have an unreasonably small amount of capital for the operation of the businesses in which it is engaged or proposed to be engaged” and “able to pay its liabilities, including contingent and other liabilities, as they mature” means that such person will be able to generate enough cash from operations, asset dispositions or refinancing, or a combination thereof, to meet its obligations as they become due.

“Tax” or “Taxes” shall mean  (i) all federal, state, local or foreign taxes, charges, fees, imposts, levies or other assessments imposed by any taxing authority, including without limitation all income, gross receipts, capital, sales, use, ad valorem, value added, transfer, franchise, profits, escheat, inventory, capital stock, license, withholding, environmental, payroll, employment, social security, unemployment, excise, severance, stamp, occupation, property, unclaimed property, estimated taxes and any other taxes, customs duties, fees, assessments and charges of any kind whatsoever, (ii) all interest, penalties, fines, additions to Tax or additional amounts imposed by any Governmental Entity in connection with any item described in clause (i) and (iii) any liability in respect of any items described in clauses (i) or (ii) payable by reason of any contract, assumption, transferee liability, operation of law, Treasury Regulation Section 1.1502-6 (or any predecessor or successor thereof of any analogous or similar provision of Tax Law) or otherwise.

“Tax Return” means any return, report, form or statement filed or required to be filed with respect to any Tax, including any attachment thereto or amendment thereof.

“Transaction Documents” means this Agreement and the Equity Financing Commitment.

“Transaction Expenses” means (without duplication and solely to the extent any of the following obligations remain outstanding immediately prior to the Effective Time) any and all (to the extent requested, approved or consented to, in each case, whether or not in writing, by U.S. Ecology, Inc., any of its subsidiaries (other than the Company and the Company Subsidiaries) or their respective officers, directors or other employees who hold management positions) (i) investment banking fees incurred by the Company or any Company Subsidiary in connection with the transactions contemplated by this Agreement, and (ii) legal, accounting and other advisory (e.g., investment banking, legal or accounting) expenses incurred by the Company or any Company Subsidiary in connection with the transactions contemplated by this Agreement, including the fees of O’Melveny & Myers LLP, in any case, incurred prior to the Closing Date, in each case of clauses (i) and (ii) above, that were entered into or incurred for the period beginning on June 18, 2014 and ending on the Closing Date; provided, that Transaction Expenses shall not include any fees, costs or expenses in connection with the evaluation of this Agreement and the transactions contemplated hereby by Mr. Lou Galasso III, on his own behalf (and not at the request of U.S. Ecology, Inc., any of its subsidiaries (other than the Company and

57

the Company Subsidiaries) or their respective officers, directors or other employees who hold management positions).  For the avoidance of doubt, to the extent US Ecology, Inc. or its Affiliates (other than the Company and the Company Subsidiaries) pays or is obligated to pay any such expenses, such expenses shall not constitute Transaction Expenses.

(c)The following terms have the meanings given such terms in the Sections set forth below:

Term	Section
Accounting Firm	SECTION 2.02(a)(iii)
Accounting Services	SECTION 8.09(a)
Adjusted Purchase Price	SECTION 2.02(b)
Agreement	Preamble
Applicable Law	SECTION 4.17(a)
ASPV Acquisition Documents	SECTION 5.03
ASPV Merger Agreement	SECTION 5.03
Assets	SECTION 4.10
Balance Sheet	SECTION 4.07
Bankruptcy and Equity Exception	SECTION 4.01
Benefit Plans	SECTION 4.15(a)
Buyer	Preamble
Buyer Accounting Services	SECTION 8.09(e)
Buyer Released Party	SECTION 8.08
Buyer Releasing Party	SECTION 8.08
Buyer Savings Plan	SECTION 8.07(e)
Buyer Service Providers	SECTION 8.09(e)
Buyer Service Termination Notice	SECTION 8.09(e)
Closing	SECTION 2.01(a)
Closing Cash	SECTION 2.02(a)
Closing Date	SECTION 2.01(a)
Closing Indebtedness	SECTION 2.02(a)
Closing Transaction Expenses	SECTION 2.02(a)
Closing Working Capital	SECTION 2.02(a)
Company	Recitals
Company Plans	SECTION 4.15(a)
Company Property	SECTION 4.11(c)
Company Subsidiary	SECTION 4.06(a)
Confidentiality Agreement	SECTION 7.01(a)
Continuing Employee	SECTION 8.07(a)
control	SECTION 15.07(b)
Customer Service Contracts	SECTION 4.19(g)
Disposal Services	SECTION 8.10
Effective Time	SECTION 2.01(a)
End Date	SECTION 13.01(c)
Environmental Matters	SECTION 4.19(l)
Environmental Permits	SECTION 4.19(b)

58

Equity Financing	SECTION 6.05
Equity Financing Commitment	SECTION 6.05
ERISA	SECTION 4.15(a)
ERISA Affiliate	SECTION 4.15(d)
Estimated CapEx Adjustment	SECTION 2.01(b)
Estimated Closing Cash	SECTION 2.01(b)
Estimated Closing Indebtedness	SECTION 2.01(b)
Estimated Transaction Expenses	SECTION 2.01(b)
Estimated Working Capital	SECTION 15.07(b)
Financial Statements	SECTION 4.07
Governmental Entity	SECTION 4.02(b)
Guarantor	SECTION 6.06
Guaranty	SECTION 6.06
Human Resource Services	SECTION 8.09(a)
Insurance Policies	SECTION 4.22(a)
IT Services	SECTION 8.09(a)
Leased Property	SECTION 4.11(b)
Liens	SECTION 4.02(a)
Material Contracts	SECTION 4.13(t)
Multiemployer Plan	SECTION 4.15(e)
NAICS	SECTION 4.19(j)
Names	SECTION 7.03
Notice of Disagreement	SECTION 2.02(a)(ii)
Orders	SECTION 4.14
Owned Real Property	SECTION 4.11(a)
Payment Period	SECTION 8.09(b)
Permits	SECTION 4.17(b)
Permitted Liens	SECTION 4.10
Pre-Closing Tax Period	SECTION 12.01
Pre-Closing Transfers	SECTION 5.02(c)
Proceedings	SECTION 4.14
Purchase Price	SECTION 1.01
Records	SECTION 8.05(a)
Restricted Cash	SECTION 15.07(b)
Scheduled Consent	SECTION 8.01
Seller	Preamble
Seller Confidential Information	SECTION 7.01(b)
Seller Disclosure Schedule	Article IV
Seller Plans	SECTION 4.15(a)
Seller Released Party	SECTION 8.08
Seller Releasing Party	SECTION 8.08
Seller Savings Plan	SECTION 8.07(e)
Service Providers	SECTION 8.09(a)
Service Termination Notice	SECTION 8.09(b)
Services	SECTION 8.09(a)
Shares	Recitals

59

Sponsor Fund	SECTION 6.05
Statement	SECTION 2.02(a)(i)
Transfer Taxes	SECTION 12.04
WC Amount	SECTION 2.02(b)
Whitman	SECTION 11.01(c)
Working Capital	SECTION 2.02(c)
Working Capital Accounts	SECTION 2.02(c)
Working Capital Adjustment	SECTION 2.02(b)

SECTION 15.08Counterparts.  This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more such counterparts have been signed by each of the parties and delivered to the other party.  Delivery of an executed counterpart of a signature page to this Agreement by facsimile or scanned pages shall be effective as delivery of a manually executed counterpart to this Agreement.

SECTION 15.09Entire Agreement.  This Agreement, the other Transaction Documents and the Confidentiality Agreement contain the entire agreement and understanding between the parties hereto with respect to the subject matter hereof and supersede all prior agreements and understandings relating to such subject matter.

SECTION 15.10Brokers.  Each party hereto hereby represents and warrants that (a) no brokers or finders that have acted for such party in connection with this Agreement or the transactions contemplated hereby or that may be entitled to any brokerage fee, finder’s fee or commission in respect thereof and (b) each party shall pay all fees or commissions which may be payable to the firm so named with respect to such party.

SECTION 15.11Severability.  If any provision of this Agreement (or any portion thereof) or the application of any such provision (or any portion thereof) to any person or circumstance shall be held invalid, illegal or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision hereof (or the remaining portion thereof) or the application of such provision to any other persons or circumstances.

SECTION 15.12Consent to Jurisdiction.  Each of Buyer and Seller irrevocably submits to the exclusive jurisdiction of (a) the Court of Chancery of the State of Delaware, New Castle County, and (b) the United States District Court for the District of Delaware, sitting in Wilmington, Delaware, for the purposes of any suit, action or other proceeding arising out of this Agreement, the other Transaction Documents or any transaction contemplated hereby.  Each of Buyer and Seller agrees to commence any action, suit or proceeding relating hereto either in the United States District Court for the District of Delaware sitting in Wilmington, Delaware or if such suit, action or other proceeding may not be brought in such court for jurisdictional reasons, in the Chancery Court of the State of Delaware, New Castle County.  Each of Buyer and Seller further agrees that service of any process, summons, notice or document by U.S. registered mail to such party’s respective address set forth above shall be effective service of process for any action, suit or proceeding in Delaware with respect to any matters to which it has submitted to

60

jurisdiction in this Section 15.12; provided, that nothing in this Section 15.12 shall affect the right of any party to serve legal process in any manner permitted by Applicable Law.  Each of Buyer and Seller irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement or the transactions contemplated hereby in (i) the Chancery Court of the State of Delaware, New Castle County, or (ii) the United States District Court for the District of Delaware sitting in Wilmington, Delaware, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.

SECTION 15.13Waiver of Jury Trial.  Each party hereto hereby waives to the fullest extent permitted by Applicable Law, any right it may have to a trial by jury in respect of any litigation directly or indirectly arising out of, under or in connection with this Agreement or any of the other Transaction Documents.  Each party hereto (a) certifies that no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce that foregoing waiver and (b) acknowledges that it and the other parties hereto have been induced to enter into this Agreement and the other Transaction Documents, as applicable, by, among other things, the mutual waivers and certifications in this Section 15.13.

SECTION 15.14GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES OF SUCH STATE.

SECTION 15.15Non-Recourse.  This Agreement may only be enforced against, and any claim or cause of action based upon, arising out of, or related to this Agreement may only be brought against the entities that are expressly named as parties hereto and then only with respect to the specific obligations set forth herein with respect to such party.  Except to the extent a named party to this Agreement (and then only to the extent of the specific obligations undertaken by such named party in this Agreement and not otherwise), no past, present or future director, officer, employee, incorporator, member, partner, stockholder, Affiliate, agent, attorney or representative of any party hereto shall have any liability for any obligations or liabilities of any party hereto under this Agreement or for any claim based on, in respect of, or by reason of, the transactions contemplated hereby.

[Signature page follows.]

61

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first written above.

EQ INDUSTRIAL SERVICES, INC.,
By	/s/ Jeffrey R. Feeler
	Name: Jeffrey R. Feeler
	Title: President
ASPV HOLDINGS, INC.,
By	/s/ Corwynne Carruthers
	Name: Corwynne Carruthers
	Title: Vice President

62

EX-15

EXHIBIT 15

US Ecology, Inc.

Boise, ID

We have reviewed, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the unaudited interim financial information of US Ecology, Inc. and subsidiaries for the three-month and nine-month periods ended September 30, 2015 and 2014, as indicated in our report dated November 4, 2015; because we did not perform an audit, we expressed no opinion on that information.

We are aware that our report referred to above, which is included in your Quarterly Report on Form 10-Q for the quarter ended September 30, 2015, is incorporated by reference in Registration Statement Nos. 333-157529, 333-68868, 333-93105, 333-140419, and 333-69863 on Form S-8, Registration Statement No. 333-187001 on Form S-3, and Registration Statement No. 333-187003 on Form S-4.

We also are aware that the aforementioned report, pursuant to Rule 436(c) under the Securities Act of 1933, is not considered a part of the Registration Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act.

/s/ Deloitte & Touche LLP

Boise, Idaho

November 4, 2015

1

EX-31.1

EXHIBIT 31.1

US ECOLOGY, INC.

CERTIFICATIONS PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Jeffrey R. Feeler, certify that:

1.I have reviewed this quarterly report on Form 10-Q of US Ecology, 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 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 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: November 4, 2015	/s/ Jeffrey R. Feeler
	Jeffrey R. Feeler
	President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

US ECOLOGY, INC.

CERTIFICATIONS PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Eric L. Gerratt, certify that:

1.I have reviewed this quarterly report on Form 10-Q of US Ecology, 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 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 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: November 4, 2015	/s/ Eric L. Gerratt
	Eric L. Gerratt
	Executive Vice President, Chief Financial Officer and Treasurer

EX-32

EXHIBIT 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of US Ecology, Inc., (the “Company”) for the quarterly period ended September 30, 2015, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Jeffrey R. Feeler and Eric L. Gerratt, Chief Executive Officer and Chief Financial Officer, respectively, of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to our knowledge:

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

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

Date: November 4, 2015	/s/ Jeffrey R. Feeler
	Jeffrey R. Feeler
	President and Chief Executive Officer
	/s/ Eric L. Gerratt
	Eric L. Gerratt
	Executive Vice President, Chief Financial Officer and Treasurer

XML

DISPOSITION (Details) - USD ($)	3 Months Ended			9 Months Ended
	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Aug. 04, 2015
Disposal Group Information
Goodwill impairment charges				$ 6,700,000
Balance Sheet Disclosure
Total assets held for sale	$ 78,775,000			78,775,000
Total liabilities held for sale	20,240,000			20,240,000
Allstate | Disposal Group, Held-for-sale, Not Discontinued Operations
Disposal Group Information
Amount to be received subject to adjustments for working capital and capital expenditures						$ 58,000,000
Goodwill impairment charges				6,400,000
Income Statement Disclosure
Income before income taxes	1,700,000		$ 265,000	(5,700,000)	$ 301,000
Balance Sheet Disclosure
Receivables, net	22,340,000			22,340,000
Prepaid expenses and other current assets	1,555,000			1,555,000
Property and equipment, net	19,484,000			19,484,000
Intangible assets, net	21,824,000			21,824,000
Goodwill	13,572,000			13,572,000
Total assets held for sale	78,775,000			78,775,000
Accounts payable	6,108,000			6,108,000
Accrued liabilities	1,616,000			1,616,000
Accrued salaries and benefits	568,000			568,000
Deferred income taxes	11,948,000			11,948,000
Total liabilities held for sale	$ 20,240,000			20,240,000
Field & Industrial Services
Disposal Group Information
Goodwill impairment charges		$ 6,700,000		$ 6,700,000
Goodwill impairment charge per diluted share		$ 0.31

XML

OPERATING SEGMENTS (Details 3) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Revenue, Property and Equipment and Intangible Assets Outside of the United States
Total revenue	$ 148,414	$ 170,864	$ 424,797	$ 290,237
Total long- lived assets	447,574		447,574		$ 506,351
United States
Revenue, Property and Equipment and Intangible Assets Outside of the United States
Total revenue	138,367	155,043	392,698	243,689
Total long- lived assets	396,295		396,295		446,412
Canada
Revenue, Property and Equipment and Intangible Assets Outside of the United States
Total revenue	10,047	$ 15,821	32,099	$ 46,548
Total long- lived assets	$ 51,279		$ 51,279		$ 59,939

XML

CLOSURE AND POST-CLOSURE OBLIGATIONS (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Changes to closure and post-closure obligations
Closure and post-closure obligations, beginning of period	$ 72,690	$ 72,870
Accretion expense	1,132	3,208	$ 1,675
Payments	(2,250)	(4,386)
Currency translation	(109)	(229)
Closure and post-closure obligations, end of period	71,463	71,463
Less current portion	(4,402)	(4,402)		$ (5,359)
Long-term portion	$ 67,061	$ 67,061		$ 67,511

XML

SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Thousands			9 Months Ended
	Oct. 28, 2015	Oct. 01, 2015	Sep. 30, 2015	Sep. 30, 2014	Nov. 01, 2015
SUBSEQUENT EVENT
Dividend paid in cash			$ 11,700	$ 11,640
Subsequent event
SUBSEQUENT EVENT
Quarterly dividend declared (in dollars per share)		$ 0.18
Dividend paid in cash	$ 3,900
Subsequent event | Disposal Group, Disposed of by Sale, Not Discontinued Operations | Allstate
SUBSEQUENT EVENT
Cash consideration					$ 58,800

XML

GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Aug. 04, 2015	Dec. 31, 2014
Changes in goodwill
Balance at the beginning of the period				$ 217,609
Impairment charges				(6,700)
Classified as held for sale				(13,572)
Foreign Currency Translation				(2,512)
Balance at the end of the period	$ 194,825			194,825
Intangible Assets
Amortizing intangible assets, Cost	211,809			211,809			$ 240,905
Accumulated amortization	(18,499)			(18,499)			(12,135)
Amortizing intangible assets, Net	193,310			193,310			228,770
Total intangible assets, cost	261,686			261,686			290,802
Total intangible assets, net	243,187			243,187			278,667
Amortization expense	2,952		$ 4,018	9,558	$ 5,233
Permits and licenses
Intangible Assets
Nonamortizing intangible assets	49,750			49,750			49,750
Tradename
Intangible Assets
Nonamortizing intangible assets	127			127			147
Allstate | Disposal Group, Held-for-sale, Not Discontinued Operations
Changes in goodwill
Impairment charges				(6,400)
Amount to be received subject to adjustments for working capital and capital expenditures						$ 58,000
Permits, licenses and lease
Intangible Assets
Amortizing intangible assets, Cost	110,357			110,357			113,693
Accumulated amortization	(6,085)			(6,085)			(4,427)
Amortizing intangible assets, Net	104,272			104,272			109,266
Customer relationships
Intangible Assets
Amortizing intangible assets, Cost	82,124			82,124			103,086
Accumulated amortization	(7,728)			(7,728)			(4,488)
Amortizing intangible assets, Net	74,396			74,396			98,598
Technology - formulae and processes
Intangible Assets
Amortizing intangible assets, Cost	6,790			6,790			7,844
Accumulated amortization	(1,037)			(1,037)			(1,009)
Amortizing intangible assets, Net	5,753			5,753			6,835
Customer backlog
Intangible Assets
Amortizing intangible assets, Cost	3,652			3,652			4,600
Accumulated amortization	(469)			(469)			(246)
Amortizing intangible assets, Net	3,183			3,183			4,354
Tradename
Intangible Assets
Amortizing intangible assets, Cost	4,318			4,318			5,481
Accumulated amortization	(1,850)			(1,850)			(979)
Amortizing intangible assets, Net	2,468			2,468			4,502
Developed software
Intangible Assets
Amortizing intangible assets, Cost	2,908			2,908			3,745
Accumulated amortization	(605)			(605)			(428)
Amortizing intangible assets, Net	2,303			2,303			3,317
Non-compete agreements
Intangible Assets
Amortizing intangible assets, Cost	732			732			920
Accumulated amortization	(610)			(610)			(462)
Amortizing intangible assets, Net	122			122			458
Internet domain and website
Intangible Assets
Amortizing intangible assets, Cost	540			540			869
Accumulated amortization	(36)			(36)			(24)
Amortizing intangible assets, Net	504			504			845
Database
Intangible Assets
Amortizing intangible assets, Cost	388			388			667
Accumulated amortization	(79)			(79)			(72)
Amortizing intangible assets, Net	309			309			$ 595
Environmental Services
Changes in goodwill
Balance at the beginning of the period				152,396
Foreign Currency Translation				(2,512)
Balance at the end of the period	149,884			149,884
Field & Industrial Services
Changes in goodwill
Balance at the beginning of the period				65,213
Impairment charges		$ (6,700)		(6,700)
Classified as held for sale				(13,572)
Balance at the end of the period	$ 44,941			$ 44,941
Goodwill impairment charge per diluted share		$ 0.31

XML

DEBT (Tables)

9 Months Ended

Sep. 30, 2015

DEBT

Schedule of long-term debt

	September 30,			December 31,
$s in thousands	2015			2014
Term loan	$	360,767		$	395,616
Net discount on term loan	(852		)	(963		)
Total debt	359,915			394,653
Current portion of long-term debt	(3,505		)	(3,828		)
Long-term debt	$	356,410		$	390,825

Schedule of maximum consolidated senior secured leverage ratio for different periods

Fiscal Quarters Ending	Maximum Ratio
June 30, 2014 through September 30, 2015	4.00 to 1.00
December 31, 2015 through September 30, 2016	3.75 to 1.00
December 31, 2016 through September 30, 2017	3.50 to 1.00
December 31, 2017 through September 30, 2018	3.25 to 1.00
December 31, 2018 and thereafter	3.00 to 1.00

XML

GENERAL (Policies)

9 Months Ended

Sep. 30, 2015

GENERAL

Basis of Presentation

Basis of Presentation

The accompanying unaudited consolidated financial statements include the results of operations, financial position and cash flows of US Ecology, Inc. and its wholly-owned subsidiaries. All significant intercompany balances have been eliminated. Throughout these financial statements words such as “we,” “us,” “our,” “US Ecology” and the “Company” refer to US Ecology, Inc. and its subsidiaries.

In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments necessary to present fairly, in all material respects, the results of the Company for the periods presented. These consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014. The results for the three and nine months ended September 30, 2015 are not necessarily indicative of results to be expected for the entire fiscal year. In these consolidated financial statements, certain amounts in prior periods’ consolidated financial statements have been reclassified to conform with the current period presentation.

The Company’s Consolidated Balance Sheet as of December 31, 2014 has been derived from the Company’s audited Consolidated Balance Sheet as of that date and has been revised for purchase price measurement period adjustments related to the acquisition of EQ as disclosed in Note 2. Additionally, on August 4, 2015, we entered into a definitive agreement to sell our Allstate Power Vac, Inc. (“Allstate”) subsidiary to a private investor group. We completed the sale of Allstate on November 1, 2015. All September 30, 2015 carrying amounts of assets and liabilities of Allstate have been classified as held for sale in our Consolidated Balance Sheets as disclosed in Note 3.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements. As it relates to estimates and assumptions in amortization rates and environmental obligations, significant engineering, operations and accounting judgments are required. We review these estimates and assumptions no less than annually. In many circumstances, the ultimate outcome of these estimates and assumptions will not be known for decades into the future. Actual results could differ materially from these estimates and assumptions due to changes in applicable regulations, changes in future operational plans and inherent imprecision associated with estimating environmental impacts far into the future.

Held for Sale

Held for Sale

We report a business as held for sale when management has approved or received approval to sell the business and is committed to a formal plan, the business is available for immediate sale, the business is being actively marketed, the sale is probable and anticipated to occur during the ensuing year and certain other specified criteria are met. A business classified as held for sale is recorded at the lower of its carrying amount or estimated fair value less cost to sell. If the carrying amount of the business exceeds its estimated fair value, a loss is recognized. Depreciation and amortization expense are not recorded on long-lived assets of a business classified as held for sale. Assets and liabilities related to a business classified as held for sale are segregated in the September 30, 2015 unaudited Consolidated Balance Sheets and major classes are separately disclosed in the notes to the unaudited consolidated financial statements commencing in the period in which the business is classified as held for sale.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-03 Simplifying the Presentation of Debt Issuance Costs. This ASU requires an entity to present debt issuance costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. The guidance is effective for annual and interim reporting periods beginning after December 15, 2015. We do not believe the adoption of this update will have a material effect on our financial position and results of operations.

In May 2014, the FASB issued ASU No. 2014-09 Revenue from Contracts with Customers, which provides guidance for revenue recognition. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The standard permits the use of either the retrospective or cumulative effect transition method. The ASU also requires enhanced disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows from contracts with customers. On July 9, 2015, the FASB decided to delay the effective date of ASU 2014-09 by one year. The new guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted but not before annual periods beginning after December 15, 2016. We are currently assessing the impact the adoption of ASU 2014-09 may have on our consolidated financial statements.

XML

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Basic
Net income, basic	$ 9,904	$ 13,333	$ 17,907	$ 29,558
Weighted average basic shares outstanding	21,655,000	21,570,000	21,619,000	21,526,000
Earnings per share (in dollars per share)	$ 0.46	$ 0.62	$ 0.83	$ 1.37
Diluted
Net income, diluted	$ 9,904	$ 13,333	$ 17,907	$ 29,558
Weighted average basic shares outstanding	21,655,000	21,570,000	21,619,000	21,526,000
Dilutive effect of stock-based awards (in shares)	94,000	110,000	104,000	123,000
Weighted average diluted shares outstanding	21,749,000	21,680,000	21,723,000	21,649,000
Earnings per share (in dollars per share)	$ 0.46	$ 0.61	$ 0.82	$ 1.37
Anti-dilutive shares excluded from calculation	181,000	78,000	192,000	50,000

XML

CONCENTRATIONS AND CREDIT RISK (Details)	3 Months Ended	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2014
Total revenue | One customer
CONCENTRATIONS AND CREDIT RISK
Concentration of risk (as a percent)	12.00%	10.00%

XML

OPERATING SEGMENTS (Tables)

9 Months Ended

Sep. 30, 2015

OPERATING SEGMENTS

Summary of financial information concerning reportable segments

	Three Months Ended September 30, 2015
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	76,079	$	—	$	—	$	76,079
Services Revenue:
Transportation and Logistics (1)	20,191		5,694		—		25,885
Industrial Cleaning (2)	—		27,532		—		27,532
Technical Services (3)	—		16,584		—		16,584
Remediation (4)	—		1,253		—		1,253
Other (5)	—		1,081		—		1,081
Total Revenue	$	96,270	$	52,144	$	—	$	148,414
Depreciation, amortization and accretion	$	8,664	$	1,885	$	126	$	10,675
Capital expenditures	$	4,480	$	1,401	$	436	$	6,317
Total assets	$	599,136	$	201,627	$	62,613	$	863,376

	Three Months Ended September 30, 2014
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	84,778	$	—	$	—	$	84,778
Services Revenue:
Transportation and Logistics (1)	23,256		11,657		—		34,913
Industrial Cleaning (2)	—		22,142		—		22,142
Technical Services (3)	—		15,985		—		15,985
Remediation (4)	—		11,814		—		11,814
Other (5)	—		1,232		—		1,232
Total Revenue	$	108,034	$	62,830	$	—	$	170,864
Depreciation, amortization and accretion	$	9,748	$	3,271	$	276	$	13,295
Capital expenditures	$	4,924	$	3,822	$	506	$	9,252
Total assets	$	627,340	$	229,971	$	59,838	$	917,149

	Nine Months Ended September 30, 2015
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	224,007	$	—	$	—	$	224,007
Services Revenue:
Transportation and Logistics (1)	54,878		19,986		—		74,864
Industrial Cleaning (2)	—		69,980		—		69,980
Technical Services (3)	—		46,807		—		46,807
Remediation (4)	—		5,492		—		5,492
Other (5)	—		3,647		—		3,647
Total Revenue	$	278,885	$	145,912	$	—	$	424,797
Depreciation, amortization and accretion	$	26,167	$	7,920	$	405	$	34,492
Capital expenditures	$	17,564	$	6,250	$	1,879	$	25,693
Total assets	$	599,136	$	201,627	$	62,613	$	863,376

	Nine Months Ended September 30, 2014
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	178,254	$	—	$	—	$	178,254
Services Revenue:
Transportation and Logistics (1)	41,012		12,895		—		53,907
Industrial Cleaning (2)	—		25,827		—		25,827
Technical Services (3)	—		17,994		—		17,994
Remediation (4)	—		12,841		—		12,841
Other (5)	—		1,414		—		1,414
Total Revenue	$	219,266	$	70,971	$	—	$	290,237
Depreciation, amortization and accretion	$	19,415	$	3,759	$	464	$	23,638
Capital expenditures	$	12,751	$	4,410	$	749	$	17,910
Total assets	$	627,340	$	229,971	$	59,838	$	917,149

(1) Includes such services as collection, transportation and disposal of non-hazardous and hazardous waste. Prior to the acquisition of EQ on June 17, 2014, services within Environmental Services included transportation services.

(2) Includes such services as industrial cleaning and maintenance for utilities, refineries, chemical plants, pulp and paper mills, steel and automotive plants, and refinery services such as tank cleaning, centrifuge and temporary storage.

(3) Includes such services as Total Waste Management (“TWM”) programs, retail services, laboratory packing, less-than-truck-load (“LTL”) service and Household Hazardous Waste (“HHW”) collection.

(4) Includes such services as site assessment, onsite treatment, project management and remedial action planning and execution.

(5) Includes such services as emergency response and marine.

Reconciliation of Adjusted EBITDA to Net Income

	Three Months Ended September 30,						Nine Months Ended September 30,
$s in thousands	2015			2014			2015			2014
Adjusted EBITDA:
Environmental Services	$	39,244		$	45,483		$	112,859		$	94,966
Field & Industrial Services	5,611			6,136			13,709			7,256
Corporate	(11,101		)	(11,180		)	(34,161		)	(24,413		)
Total	33,754			40,439			92,407			77,809
Reconciliation to Net income:
Income tax expense	(6,858		)	(8,406		)	(14,815		)	(17,880		)
Interest expense	(5,081		)	(4,543		)	(16,208		)	(5,488		)
Interest income	17			11			64			94
Foreign currency loss	(994		)	(830		)	(1,769		)	(1,027		)
Other income	387			301			1,156			557
Impairment charges	—			—			(6,700		)	—
Depreciation and amortization of plant and equipment	(6,591		)	(8,318		)	(21,726		)	(16,730		)
Amortization of intangibles	(2,952		)	(4,018		)	(9,558		)	(5,233		)
Stock-based compensation	(646		)	(344		)	(1,736		)	(869		)
Accretion and non-cash adjustment of closure & post-closure liabilities	(1,132		)	(959		)	(3,208		)	(1,675		)
Net income	$	9,904		$	13,333		$	17,907		$	29,558

Summary of revenues by geographic location

	Three Months Ended September 30,				Nine Months Ended September 30,
$s in thousands	2015		2014		2015		2014
United States	$	138,367	$	155,043	$	392,698	$	243,689
Canada	10,047		15,821		32,099		46,548
Total revenue	$	148,414	$	170,864	$	424,797	$	290,237

Schedule of long-lived assets by geographic location

	September 30,		December 31,
$s in thousands	2015		2014
United States	$	396,295	$	446,412
Canada	51,279		59,939
Total long-lived assets	$	447,574	$	506,351

XML

OPERATING SEGMENTS (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015 USD ($) segment	Sep. 30, 2014 USD ($)	Sep. 30, 2015 USD ($)	Sep. 30, 2014 USD ($)	Dec. 31, 2014 USD ($)
OPERATING SEGMENTS
Number of reportable segments | segment	2
Total revenue	$ 148,414	$ 170,864	$ 424,797	$ 290,237
Depreciation, amortization & accretion	10,675	13,295	34,492	23,638
Capital expenditures	6,317	9,252	25,693	17,910
Total assets	863,376	917,149	863,376	917,149	$ 920,319
Treatment and Disposal Revenue
OPERATING SEGMENTS
Total revenue	76,079	84,778	224,007	178,254
Transportation and Logistics
OPERATING SEGMENTS
Total revenue	25,885	34,913	74,864	53,907
Industrial Cleaning
OPERATING SEGMENTS
Total revenue	27,532	22,142	69,980	25,827
Technical Services
OPERATING SEGMENTS
Total revenue	16,584	15,985	46,807	17,994
Remediation
OPERATING SEGMENTS
Total revenue	1,253	11,814	5,492	12,841
Other
OPERATING SEGMENTS
Total revenue	1,081	1,232	3,647	1,414
Corporate
OPERATING SEGMENTS
Depreciation, amortization & accretion	126	276	405	464
Capital expenditures	436	506	1,879	749
Total assets	62,613	59,838	62,613	59,838
Environmental Services | Operating Segment
OPERATING SEGMENTS
Total revenue	96,270	108,034	278,885	219,266
Depreciation, amortization & accretion	8,664	9,748	26,167	19,415
Capital expenditures	4,480	4,924	17,564	12,751
Total assets	599,136	627,340	599,136	627,340
Environmental Services | Operating Segment | Treatment and Disposal Revenue
OPERATING SEGMENTS
Total revenue	76,079	84,778	224,007	178,254
Environmental Services | Operating Segment | Transportation and Logistics
OPERATING SEGMENTS
Total revenue	20,191	23,256	54,878	41,012
Field & Industrial Services | Operating Segment
OPERATING SEGMENTS
Total revenue	52,144	62,830	145,912	70,971
Depreciation, amortization & accretion	1,885	3,271	7,920	3,759
Capital expenditures	1,401	3,822	6,250	4,410
Total assets	201,627	229,971	201,627	229,971
Field & Industrial Services | Operating Segment | Transportation and Logistics
OPERATING SEGMENTS
Total revenue	5,694	11,657	19,986	12,895
Field & Industrial Services | Operating Segment | Industrial Cleaning
OPERATING SEGMENTS
Total revenue	27,532	22,142	69,980	25,827
Field & Industrial Services | Operating Segment | Technical Services
OPERATING SEGMENTS
Total revenue	16,584	15,985	46,807	17,994
Field & Industrial Services | Operating Segment | Remediation
OPERATING SEGMENTS
Total revenue	1,253	11,814	5,492	12,841
Field & Industrial Services | Operating Segment | Other
OPERATING SEGMENTS
Total revenue	$ 1,081	$ 1,232	$ 3,647	$ 1,414

XML

DEBT (Details) - USD ($) $ in Thousands		9 Months Ended
	Jun. 17, 2014	Sep. 30, 2015	Dec. 31, 2014	Jun. 16, 2014
Long-term debt
Term loan		$ 360,767	$ 395,616
Net discount on term loan		(852)	(963)
Total debt		359,915	394,653
Current portion of long-term debt		(3,505)	(3,828)
Long-term debt		$ 356,410	$ 390,825
Credit Agreement
Long-term debt
Mandatory prepayments as a percentage of adjusted excess cash flow if entity's total leverage ratio is greater than the specified leverage ratio	50.00%
Total leverage ratio	2.50
Mandatory prepayments as a percentage of adjusted excess cash flow if entity's total leverage ratio is equal to or less than the specified leverage ratio	0.00%
Credit Agreement | EQ
Long-term debt
Maximum borrowing capacity	$ 540,000
Term Loan
Long-term debt
Debt instrument, aggregate annual amortization as a percentage of original principal amount	1.00%
Effective interest rate (as a percent)		4.67%
Percentage of principal amount of debt instrument for which the Company is required to enter into one or more interest rate hedge agreements		67.00%
Amount of debt hedged		$ 240,000
Prepayment premium (as a percent)	1.00%
Term Loan | Minimum
Long-term debt
Percentage of principal amount of debt instrument for which the Company is required to enter into one or more interest rate hedge agreements	50.00%
Term Loan | Base rate
Long-term debt
Percentage points added to the reference rate	2.00%
Term Loan | LIBOR
Long-term debt
Percentage points added to the reference rate	3.00%
Term Loan | EQ
Long-term debt
Maximum borrowing capacity	$ 415,000
Percentage of outstanding shares acquired	100.00%
Revolving Line of Credit
Long-term debt
Maximum borrowing capacity	$ 125,000
Amount outstanding		0
Commitment fee (as a percent)	0.50%
Availability for borrowings under line of credit		118,200
Line of credit issued in the form of a standby letters of credit		$ 6,800
Maximum consolidated senior secured leverage ratio - June 30, 2014 through September 30, 2015	4.00
Maximum consolidated senior secured leverage ratio - December 31, 2015 through September 30, 2016	3.75
Maximum consolidated senior secured leverage ratio - December 31, 2016 through September 30, 2017	3.50
Maximum consolidated senior secured leverage ratio - December 31, 2017 through September 30, 2018	3.25
Maximum consolidated senior secured leverage ratio - December 31, 2018 and thereafter	3.00
Letter of credit
Long-term debt
Maximum borrowing capacity	$ 50,000
Former Agreement
Long-term debt
Amount outstanding				$ 0
Early termination penalties incurred	$ 0

XML

BUSINESS COMBINATION

9 Months Ended

Sep. 30, 2015

BUSINESS COMBINATION

BUSINESS COMBINATION

NOTE 2.BUSINESS COMBINATION

On June 17, 2014, the Company acquired 100% of the outstanding shares of EQ Holdings, Inc. and its wholly-owned subsidiaries (collectively “EQ”). EQ is a fully integrated environmental services company providing waste treatment and disposal, wastewater treatment, remediation, recycling, industrial cleaning and maintenance, transportation, total waste management, technical services, and emergency response services to a variety of industries and customers in North America. The total purchase price was $460.9 million, net of cash acquired, and was funded through a combination of cash on hand and borrowings under a new $415.0 million term loan.

As of June 30, 2015, the Company finalized the purchase accounting for the acquisition of EQ. The following table summarizes the consideration paid for EQ and the fair value estimates of assets acquired and liabilities assumed recognized at the acquisition date, with purchase price allocation adjustments since the preliminary purchase price allocation as previously disclosed as of December 31, 2014:

	Purchase Price Allocation
$s in thousands	As Reported in Form 10-K			Adjustments			As Retrospectively Adjusted
Current assets	$	111,982		$	27		$	112,009
Property and equipment	101,543			—			101,543
Identifiable intangible assets	252,874			—			252,874
Current liabilities	(57,585		)	(727		)	(58,312		)
Other liabilities	(139,331		)	263			(139,068		)
Total identifiable net assets	269,483			(437		)	269,046
Goodwill	197,163			437			197,600
Total purchase price	$	466,646		$	—		$	466,646

Purchase price allocation adjustments related primarily to the receipt of additional information regarding the fair values of income taxes payable and receivable, deferred income taxes and residual goodwill.

Goodwill of $197.6 million arising from the acquisition is the result of several factors. EQ has an assembled workforce that serves the U.S. industrial market utilizing state-of-the-art technology to treat a wide range of industrial and hazardous waste. The acquisition of EQ increases our geographic base providing a coast-to-coast presence and an expanded service platform to better serve key North American hazardous waste markets. In addition, the acquisition of EQ provides us with an opportunity to compete for additional waste clean-up project work; expand penetration with national accounts; improve and enhance transportation, logistics, and service offerings with existing customers and attract new customers. $132.4 million of the goodwill recognized was allocated to reporting units in our Environmental Services segment and $65.2 million of the goodwill recognized was allocated to reporting units in our Field & Industrial Services segment. None of the goodwill recognized is expected to be deductible for income tax purposes.

The fair value estimate of identifiable intangible assets by major intangible asset class and related weighted average amortization period are as follows:

$s in thousands	Fair Value		Weighted Average Amortization Period (Years)
Customer relationships	$	98,400	15
Permits and licenses	89,600		45
Permits and licenses, nonamortizing	49,000		—
Tradename	5,481		3
Customer backlog	4,600		10
Developed software	3,443		9
Non-compete agreements	900		1
Internet domain and website	869		19
Database	581		15
Total identifiable intangible assets	$	252,874

The following unaudited pro forma financial information presents the combined results of operations as if EQ had been combined with us at the beginning of each of the periods presented. The pro forma financial information includes the accounting effects of the business combination, including the amortization of intangible assets, depreciation of property, plant and equipment, and interest expense. The unaudited pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the periods presented, nor should it be taken as indication of our future consolidated results of operations.

	(unaudited)		(unaudited)
	Three Months Ended		Nine Months Ended
$s in thousands, except per share amounts	September 30, 2014		September 30, 2014
Pro forma combined:
Revenue	$	170,894	$	458,091
Net income	$	13,333	$	24,835
Earnings per share
Basic	$	0.62	$	1.15
Diluted	$	0.61	$	1.15

Revenue from EQ included in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2015 was $95.0 million and $268.8 million, respectively. Operating income from EQ included in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2015 was $11.8 million and $16.1 million, respectively. Acquisition-related costs of $150,000 and $1.1 million, respectively, were included in Selling, general and administrative expenses in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2015.

XML

RECEIVABLES (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
RECEIVABLES
Trade	$ 77,593	$ 116,218
Unbilled revenue	27,703	17,857
Other	2,059	1,890
Total receivables	107,355	135,965
Allowance for doubtful accounts	(3,072)	(704)
Receivables, net	$ 104,283	$ 135,261

XML

RECEIVABLES (Tables)

9 Months Ended

Sep. 30, 2015

RECEIVABLES

Schedule of receivables

	September 30,			December 31,
$s in thousands	2015			2014
Trade	$	77,593		$	116,218
Unbilled revenue	27,703			17,857
Other	2,059			1,890
Total receivables	107,355			135,965
Allowance for doubtful accounts	(3,072		)	(704		)
Receivables, net	$	104,283		$	135,261

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

9 Months Ended

Sep. 30, 2015

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Schedule of changes in accumulated other comprehensive income (loss)

	Foreign Currency Translation			Unrealized Loss on Interest Rate Hedge			Total
Balance at December 31, 2014	$	(5,648	)	$	(2,038	)	$	(7,686	)
Other comprehensive loss before reclassifications, net of tax	(6,761		)	(3,706		)	(10,467		)
Amounts reclassified out of AOCI, net of tax (1)	—			1,715			1,715
Other comprehensive loss	(6,761		)	(1,991		)	(8,752		)
Balance at September 30, 2015	$	(12,409	)	$	(4,029	)	$	(16,438	)

(1) Before-tax reclassifications of $871,000 ($566,000 after-tax) and $2.6 million ($1.7 million after-tax) for the three and nine months ended September 30, 2015, respectively, were included in Interest expense in the Company’s consolidated statements of operations. Amount relates to interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying debt are made. Amounts in AOCI expected to be recognized in interest expense over the next 12 months total approximately $3.5 million ($2.3 million after tax).

XML

FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Assets measured at fair value on a recurring basis
Initial notional amount		$ 250,000
Recurring
Assets measured at fair value on a recurring basis
Assets fair value disclosure	$ 5,773	5,729
Liabilities fair value disclosure	6,199	3,136
Recurring | Interest rate swap agreement
Assets measured at fair value on a recurring basis
Liabilities fair value disclosure	6,199	3,136
Recurring | Fixed-income securities
Assets measured at fair value on a recurring basis
Assets fair value disclosure	4,015	3,990
Recurring | Money market funds
Assets measured at fair value on a recurring basis
Assets fair value disclosure	1,758	1,739
Recurring | Quoted Prices in Active Markets (Level 1)
Assets measured at fair value on a recurring basis
Assets fair value disclosure	2,159	2,139
Recurring | Quoted Prices in Active Markets (Level 1) | Fixed-income securities
Assets measured at fair value on a recurring basis
Assets fair value disclosure	401	400
Recurring | Quoted Prices in Active Markets (Level 1) | Money market funds
Assets measured at fair value on a recurring basis
Assets fair value disclosure	1,758	1,739
Recurring | Other Observable Inputs (Level 2)
Assets measured at fair value on a recurring basis
Assets fair value disclosure	3,614	3,590
Liabilities fair value disclosure	6,199	3,136
Recurring | Other Observable Inputs (Level 2) | Interest rate swap agreement
Assets measured at fair value on a recurring basis
Liabilities fair value disclosure	6,199	3,136
Recurring | Other Observable Inputs (Level 2) | Fixed-income securities
Assets measured at fair value on a recurring basis
Assets fair value disclosure	$ 3,614	$ 3,590

XML

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2015

FAIR VALUE MEASUREMENTS

Schedule of assets measured at fair value on a recurring basis

	September 30, 2015
	Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	401	$	3,614	$	—	$	4,015
Money market funds (2)	1,758		—		—		1,758
Total	$	2,159	$	3,614	$	—	$	5,773
Liabilities:
Interest rate swap agreement (3)	$	—	$	6,199	$	—	$	6,199
Total	$	—	$	6,199	$	—	$	6,199

	December 31, 2014
	Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	400	$	3,590	$	—	$	3,990
Money market funds (2)	1,739		—		—		1,739
Total	$	2,139	$	3,590	$	—	$	5,729
Liabilities:
Interest rate swap agreement (3)	$	—	$	3,136	$	—	$	3,136
Total	$	—	$	3,136	$	—	$	3,136

(1) We invest a portion of our Restricted cash and investments in fixed-income securities, including U.S. Treasury and U.S. agency securities. We measure the fair value of U.S. Treasury securities using quoted prices for identical assets in active markets. We measure the fair value of U.S. agency securities using observable market activity for similar assets. The fair value of our fixed-income securities approximates our cost basis in the investments.

(2) We invest a portion of our Restricted cash and investments in money market funds. We measure the fair value of these money market fund investments using quoted prices for identical assets in active markets.

(3) In order to manage interest rate exposure, we entered into an interest rate swap agreement in October 2014 that effectively converts a portion of our variable-rate debt to a fixed interest rate. The swap is designated as a cash flow hedge, with gains and losses deferred in other comprehensive income to be recognized as an adjustment to interest expense in the same period that the hedged interest payments affect earnings. The interest rate swap has an effective date of December 31, 2014 with an initial notional amount of $250.0 million. The fair value of the interest rate swap agreement represents the difference in the present value of cash flows calculated (i) at the contracted interest rates and (ii) at current market interest rates at the end of the period. We calculate the fair value of interest rate swap agreements quarterly based on the quoted market price for the same or similar financial instruments. The fair value of the interest rate swap agreement is included in Other long-term liabilities in the Company’s consolidated balance sheet.

XML

PROPERTY AND EQUIPMENT (Tables)

9 Months Ended

Sep. 30, 2015

PROPERTY AND EQUIPMENT

Schedule of property and equipment

	September 30,			December 31,
$s in thousands	2015			2014
Cell development costs	$	120,032		$	120,878
Land and improvements	31,811			33,002
Buildings and improvements	69,883			74,518
Railcars	17,375			17,375
Vehicles and other equipment	86,527			98,877
Construction in progress	18,879			10,831
Total property and equipment	344,507			355,481
Accumulated depreciation and amortization	(140,120		)	(127,797		)
Property and equipment, net	$	204,387		$	227,684

XML

GENERAL

9 Months Ended

Sep. 30, 2015

GENERAL

GENERAL

NOTE 1.GENERAL

Basis of Presentation

The accompanying unaudited consolidated financial statements include the results of operations, financial position and cash flows of US Ecology, Inc. and its wholly-owned subsidiaries. All significant intercompany balances have been eliminated. Throughout these financial statements words such as “we,” “us,” “our,” “US Ecology” and the “Company” refer to US Ecology, Inc. and its subsidiaries.

In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments necessary to present fairly, in all material respects, the results of the Company for the periods presented. These consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014. The results for the three and nine months ended September 30, 2015 are not necessarily indicative of results to be expected for the entire fiscal year. In these consolidated financial statements, certain amounts in prior periods’ consolidated financial statements have been reclassified to conform with the current period presentation.

The Company’s Consolidated Balance Sheet as of December 31, 2014 has been derived from the Company’s audited Consolidated Balance Sheet as of that date and has been revised for purchase price measurement period adjustments related to the acquisition of EQ as disclosed in Note 2. Additionally, on August 4, 2015, we entered into a definitive agreement to sell our Allstate Power Vac, Inc. (“Allstate”) subsidiary to a private investor group. We completed the sale of Allstate on November 1, 2015. All September 30, 2015 carrying amounts of assets and liabilities of Allstate have been classified as held for sale in our Consolidated Balance Sheets as disclosed in Note 3.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements. As it relates to estimates and assumptions in amortization rates and environmental obligations, significant engineering, operations and accounting judgments are required. We review these estimates and assumptions no less than annually. In many circumstances, the ultimate outcome of these estimates and assumptions will not be known for decades into the future. Actual results could differ materially from these estimates and assumptions due to changes in applicable regulations, changes in future operational plans and inherent imprecision associated with estimating environmental impacts far into the future.

Held for Sale

We report a business as held for sale when management has approved or received approval to sell the business and is committed to a formal plan, the business is available for immediate sale, the business is being actively marketed, the sale is probable and anticipated to occur during the ensuing year and certain other specified criteria are met. A business classified as held for sale is recorded at the lower of its carrying amount or estimated fair value less cost to sell. If the carrying amount of the business exceeds its estimated fair value, a loss is recognized. Depreciation and amortization expense are not recorded on long-lived assets of a business classified as held for sale. Assets and liabilities related to a business classified as held for sale are segregated in the September 30, 2015 unaudited Consolidated Balance Sheets and major classes are separately disclosed in the notes to the unaudited consolidated financial statements commencing in the period in which the business is classified as held for sale.

Recently Issued Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-03 Simplifying the Presentation of Debt Issuance Costs. This ASU requires an entity to present debt issuance costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. The guidance is effective for annual and interim reporting periods beginning after December 15, 2015. We do not believe the adoption of this update will have a material effect on our financial position and results of operations.

In May 2014, the FASB issued ASU No. 2014-09 Revenue from Contracts with Customers, which provides guidance for revenue recognition. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The standard permits the use of either the retrospective or cumulative effect transition method. The ASU also requires enhanced disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows from contracts with customers. On July 9, 2015, the FASB decided to delay the effective date of ASU 2014-09 by one year. The new guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted but not before annual periods beginning after December 15, 2016. We are currently assessing the impact the adoption of ASU 2014-09 may have on our consolidated financial statements.

XML

GOODWILL AND INTANGIBLE ASSETS (Tables)

9 Months Ended

Sep. 30, 2015

GOODWILL AND INTANGIBLE ASSETS

Schedule of changes in goodwill

$s in thousands	Environmental Services			Field & Industrial Services			Total
Balance at December 31, 2014 (1)	$	152,396		$	65,213		$	217,609
Impairment charges (2)	—			(6,700		)	(6,700		)
Classified as held for sale (3)	—			(13,572		)	(13,572		)
Foreign currency translation	(2,512		)	—			(2,512		)
Balance at September 30, 2015	$	149,884		$	44,941		$	194,825

(1) Balances have been revised to reflect purchase accounting measurement period adjustments related to the acquisition of EQ as disclosed in Note 2.

(2) As disclosed in Notes 3, on August 4, 2015, we entered into a definitive agreement to sell Allstate to a private investor group for approximately $58.0 million cash, subject to adjustments for working capital and capital expenditures. Allstate represents the majority of the industrial services business we acquired with the acquisition of EQ. As a result of this agreement and management’s strategic review, we evaluated the recoverability of the assets associated with our industrial services business. Based on this analysis, we recorded a non-cash goodwill impairment charge of $6.7 million, or $0.31 per diluted share, in the second quarter of 2015. We calculated the estimated fair value of the industrial services business using a combination of quoted market prices and discounted cash flows.

(3) Amounts relate to sale of Allstate as disclosed in Note 3.

Schedule of intangible assets

	September 30, 2015							December 31, 2014
$s in thousands	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Amortizing intangible assets:
Permits, licenses and lease	$	110,357	$	(6,085	)	$	104,272	$	113,693	$	(4,427	)	$	109,266
Customer relationships	82,124		(7,728		)	74,396		103,086		(4,488		)	98,598
Technology - formulae and processes	6,790		(1,037		)	5,753		7,844		(1,009		)	6,835
Customer backlog	3,652		(469		)	3,183		4,600		(246		)	4,354
Tradename	4,318		(1,850		)	2,468		5,481		(979		)	4,502
Developed software	2,908		(605		)	2,303		3,745		(428		)	3,317
Non-compete agreements	732		(610		)	122		920		(462		)	458
Internet domain and website	540		(36		)	504		869		(24		)	845
Database	388		(79		)	309		667		(72		)	595
Total amortizing intangible assets	211,809		(18,499		)	193,310		240,905		(12,135		)	228,770
Nonamortizing intangible assets:
Permits and licenses	49,750		—			49,750		49,750		—			49,750
Tradename	127		—			127		147		—			147
Total intangible assets, net	$	261,686	$	(18,499	)	$	243,187	$	290,802	$	(12,135	)	$	278,667

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2015 USD ($)
Accumulated other comprehensive loss, net of taxes
Balance at the beginning	$ 251,337
Balance at the end	252,206
Accumulated Other Comprehensive Loss
Accumulated other comprehensive loss, net of taxes
Balance at the beginning	(7,686)
Other comprehensive loss before reclassifications, net of tax	(10,467)
Amounts reclassified out of AOCI, net of tax (1)	1,715
Other comprehensive loss	(8,752)
Balance at the end	(16,438)
Foreign Currency Translation
Accumulated other comprehensive loss, net of taxes
Balance at the beginning	(5,648)
Other comprehensive loss before reclassifications, net of tax	(6,761)
Other comprehensive loss	(6,761)
Balance at the end	(12,409)
Unrealized Loss on Interest Rate Hedge
Accumulated other comprehensive loss, net of taxes
Balance at the beginning	(2,038)
Other comprehensive loss before reclassifications, net of tax	(3,706)
Amounts reclassified out of AOCI, net of tax (1)	1,715
Other comprehensive loss	(1,991)
Balance at the end	$ (4,029)

XML

OPERATING SEGMENTS (Details 2) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Reconciliation of adjusted EBITDA to Net Income
Adjusted EBITDA	$ 33,754		$ 40,439	$ 92,407	$ 77,809
Reconciliation to Net Income
Income tax expense	(6,858)		(8,406)	(14,815)	(17,880)
Interest expense	(5,081)		(4,543)	(16,208)	(5,488)
Interest income	17		11	64	94
Foreign currency loss	(994)		(830)	(1,769)	(1,027)
Other income	387		301	1,156	557
Impairment charges				(6,700)
Depreciation and amortization of plant and equipment	(6,591)		(8,318)	(21,726)	(16,730)
Amortization of intangibles	(2,952)		(4,018)	(9,558)	(5,233)
Stock-based Compensation	(646)		(344)	(1,736)	(869)
Accretion and non-cash adjustment of closure & post-closure liabilities	(1,132)		(959)	(3,208)	(1,675)
Net income	9,904		13,333	17,907	29,558
Field & Industrial Services
Reconciliation to Net Income
Impairment charges		$ (6,700)		(6,700)
Operating Segment | Environmental Services
Reconciliation of adjusted EBITDA to Net Income
Adjusted EBITDA	39,244		45,483	112,859	94,966
Operating Segment | Field & Industrial Services
Reconciliation of adjusted EBITDA to Net Income
Adjusted EBITDA	5,611		6,136	13,709	7,256
Corporate
Reconciliation of adjusted EBITDA to Net Income
Adjusted EBITDA	$ (11,101)		$ (11,180)	$ (34,161)	$ (24,413)

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Current Assets:
Cash and cash equivalents	$ 9,350	$ 22,971
Receivables, net	104,283	135,261
Prepaid expenses and other current assets	10,241	11,984
Income taxes receivable	332	6,912
Deferred income taxes	2,599	2,109
Assets held for sale	78,775
Total current assets	205,580	179,237
Property and equipment, net	204,387	227,684
Restricted cash and investments	5,773	5,729
Intangible assets, net	243,187	278,667
Goodwill	194,825	217,609
Other assets	9,624	11,308
Deferred income taxes		85
Total assets	863,376	920,319
Current Liabilities:
Accounts payable	16,745	24,513
Deferred revenue	7,212	13,190
Accrued liabilities	28,119	36,251
Accrued salaries and benefits	10,624	13,322
Income taxes payable	1,730	4,124
Current portion of closure and post-closure obligations	4,402	5,359
Current portion of long-term debt	3,505	3,828
Liabilities associated with assets held for sale	20,240
Total current liabilities	92,577	100,587
Long-term closure and post-closure obligations	67,061	67,511
Long-term debt	356,410	390,825
Other long-term liabilities	7,351	4,336
Deferred income taxes	87,771	105,723
Total liabilities	$ 611,170	$ 668,982
Commitments and contingencies
Stockholders' Equity:
Common stock $0.01 par value, 50,000 authorized; 21,735 and 21,632 shares issued, respectively	$ 217	$ 216
Additional paid-in capital	168,978	165,524
Retained earnings	99,509	93,301
Treasury stock, at cost, 1 shares	(60)	(18)
Accumulated other comprehensive loss	(16,438)	(7,686)
Total stockholders' equity	252,206	251,337
Total liabilities and stockholders' equity	$ 863,376	$ 920,319

XML

PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
PROPERTY AND EQUIPMENT
Total property and equipment	$ 344,507		$ 344,507		$ 355,481
Accumulated depreciation and amortization	(140,120)		(140,120)		(127,797)
Property and equipment, net	204,387		204,387		227,684
Depreciation and amortization expense	6,591	$ 8,318	21,726	$ 16,730
Cell development costs
PROPERTY AND EQUIPMENT
Total property and equipment	120,032		120,032		120,878
Land and improvements
PROPERTY AND EQUIPMENT
Total property and equipment	31,811		31,811		33,002
Buildings and improvements
PROPERTY AND EQUIPMENT
Total property and equipment	69,883		69,883		74,518
Railcars
PROPERTY AND EQUIPMENT
Total property and equipment	17,375		17,375		17,375
Vehicles and other equipment
PROPERTY AND EQUIPMENT
Total property and equipment	86,527		86,527		98,877
Construction in progress
PROPERTY AND EQUIPMENT
Total property and equipment	$ 18,879		$ 18,879		$ 10,831

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Other comprehensive income (loss):
Net changes in interest rate hedge, tax	$ (981)	$ 0	$ (1,072)	$ 0

XML

EARNINGS PER SHARE (Tables)

9 Months Ended

Sep. 30, 2015

EARNINGS PER SHARE

Schedule of earnings per share

	Three Months Ended September 30,
$s and shares in thousands, except per share	2015				2014
amounts	Basic		Diluted		Basic		Diluted
Net income	$	9,904	$	9,904	$	13,333	$	13,333
Weighted average basic shares outstanding	21,655		21,655		21,570		21,570
Dilutive effect of stock-based awards			94				110
Weighted average diluted shares outstanding			21,749				21,680
Earnings per share	$	0.46	$	0.46	$	0.62	$	0.61
Anti-dilutive shares excluded from calculation			181				78

	Nine Months Ended September 30,
$s and shares in thousands, except per share	2015				2014
amounts	Basic		Diluted		Basic		Diluted
Net income	$	17,907	$	17,907	$	29,558	$	29,558
Weighted average basic shares outstanding	21,619		21,619		21,526		21,526
Dilutive effect of stock-based awards			104				123
Weighted average diluted shares outstanding			21,723				21,649
Earnings per share	$	0.83	$	0.82	$	1.37	$	1.37
Anti-dilutive shares excluded from calculation			192				50

XML

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2015

COMMITMENTS AND CONTINGENCIES.

COMMITMENTS AND CONTINGENCIES

NOTE 15.COMMITMENTS AND CONTINGENCIES

Litigation and Regulatory Proceedings

In the ordinary course of business, we are involved in judicial and administrative proceedings involving federal, state, provincial or local governmental authorities, including regulatory agencies that oversee and enforce compliance with permits. Fines or penalties may be assessed by our regulators for non-compliance. Actions may also be brought by individuals or groups in connection with permitting of planned facilities, modification or alleged violations of existing permits, or alleged damages suffered from exposure to hazardous substances purportedly released from our operated sites, as well as other litigation. We maintain insurance intended to cover property and damage claims asserted as a result of our operations. Periodically, management reviews and may establish reserves for legal and administrative matters, or other fees expected to be incurred in relation to these matters.

We are not currently a party to any material pending legal proceedings and are not aware of any other claims that could, individually or in the aggregate, have a materially adverse effect on our financial position, results of operations or cash flows.

XML

EQUITY (Tables)

9 Months Ended

Sep. 30, 2015

EQUITY

Schedule of assumptions for determining the fair value for TSR awards using Monte Carlo simulation models

The following table presents the assumptions used in the Monte Carlo simulation to calculate the fair value of the PSUs granted on May 27, 2015:

Expected volatility	29.30		%
Stock price on grant date	$	46.89
Risk-free interest rate	0.86		%
Expected term (years)	2.6
Expected dividend yield	1.50		%

XML

SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2015

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

NOTE 17.SUBSEQUENT EVENTS

Quarterly Dividend

On October 1, 2015, we declared a quarterly dividend of $0.18 per common share to stockholders of record on October 21, 2015. The dividend was paid using cash on hand on October 28, 2015 in an aggregate amount of $3.9 million.

Allstate Disposition

On November 1, 2015, we completed the sale of Allstate for cash proceeds of $58.8 million, subject to post-closing adjustments for working capital. See Note 3 for additional information on the sale of Allstate including Income before income taxes and details on the major classes of assets and liabilities of Allstate classified as held for sale as of September 30, 2015.

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Cash flows from operating activities:
Net income	$ 17,907	$ 29,558
Adjustments to reconcile net income to net cash provided by operating activities:
Impairment charges	6,700
Depreciation and amortization of property and equipment	21,726	16,730
Amortization of intangible assets	9,558	5,233
Accretion of closure and post-closure obligations	3,208	1,675
Unrealized foreign currency loss	2,740	1,453
Deferred income taxes	(4,015)	2,407
Share-based compensation expense	1,736	869
Unrecognized tax benefits		(424)
Net loss on disposal of property and equipment	935	86
Amortization of debt discount	111	37
Changes in assets and liabilities (net of effect of business acquisition):
Receivables	7,221	(20,938)
Income taxes receivable	6,560	(17)
Other assets	1,785	(3,219)
Accounts payable and accrued liabilities	(5,256)	2,449
Deferred revenue	(5,371)	391
Accrued salaries and benefits	(1,877)	(1,949)
Income taxes payable	(2,317)	(2,281)
Closure and post-closure obligations	(4,386)	(879)
Net cash provided by operating activities	56,965	31,181
Cash flows from investing activities:
Purchases of property and equipment	(25,693)	(17,910)
Purchases of restricted cash and investments	(848)	(40)
Proceeds from sale of restricted cash and investments	804	662
Proceeds from sale of property and equipment	404	120
Business acquisition (net of cash acquired)		(465,895)
Net cash used in investing activities	(25,333)	(483,063)
Cash flows from financing activities:
Payments on long-term debt	(34,848)	(1,038)
Dividends paid	(11,700)	(11,640)
Proceeds from revolving credit facility	9,379
Payments on revolving credit facility	(9,379)
Proceeds from exercise of stock options	1,664	1,445
Proceeds from issuance of long-term debt		413,962
Deferred financing costs paid		(14,001)
Other	7	204
Net cash (used in) provided by financing activities	(44,877)	388,932
Effect of foreign exchange rate changes on cash	(376)	(69)
Decrease in cash and cash equivalents	(13,621)	(63,019)
Cash and cash equivalents at beginning of period	22,971	73,940
Cash and cash equivalents at end of period	9,350	10,921
Supplemental Disclosures
Income taxes paid, net of receipts	18,723	17,494
Interest paid	14,406	4,145
Non-cash investing and financing activities:
Closure and post-closure retirement asset		2,863
Capital expenditures in accounts payable	3,420	2,378
Restricted stock issued from treasury shares	$ 292	$ 546

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2015	Dec. 31, 2014
CONSOLIDATED BALANCE SHEETS
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	50,000	50,000
Common stock, shares issued	21,735	21,632
Treasury stock, shares	1	1

XML

DEBT

9 Months Ended

Sep. 30, 2015

DEBT

DEBT

NOTE 10.DEBT

Long-term debt consisted of the following:

	September 30,			December 31,
$s in thousands	2015			2014
Term loan	$	360,767		$	395,616
Net discount on term loan	(852		)	(963		)
Total debt	359,915			394,653
Current portion of long-term debt	(3,505		)	(3,828		)
Long-term debt	$	356,410		$	390,825

On June 17, 2014, in connection with the acquisition of EQ, the Company entered into a new $540.0 million senior secured credit agreement (the “Credit Agreement”) with a syndicate of banks comprised of a $415.0 million term loan (the “Term Loan”) with a maturity date of June 17, 2021 and a $125.0 million revolving line of credit (the “Revolving Credit Facility”) with a maturity date of June 17, 2019. Upon entering into the Credit Agreement, the Company terminated its existing credit agreement with Wells Fargo, dated October, 29, 2010, as amended (the “Former Agreement”). Immediately prior to the termination of the Former Agreement, there were no outstanding borrowings under the Former Agreement. No early termination penalties were incurred as a result of the termination of the Former Agreement.

Term Loan

The Term Loan provides an initial commitment amount of $415.0 million, the proceeds of which were used to acquire 100% of the outstanding shares of EQ and pay related transaction fees and expenses. The Term Loan bears interest at a base rate (as defined in the Credit Agreement) plus 2.00% or LIBOR plus 3.00%, at the Company’s option. The Term Loan is subject to amortization in equal quarterly installments in an aggregate annual amount equal to 1.00% of the original principal amount of the Term Loan. At September 30, 2015, the effective interest rate on the Term Loan, including the impact of our interest rate swap, was 4.67%. Interest only payments are due either monthly or on the last day of any interest period, as applicable. As set forth in the Credit Agreement, the Company is required to enter into one or more interest rate hedge agreements in amounts sufficient to fix the interest rate on at least 50% of the principal amount of the $415.0 million Term Loan. In October 2014, the Company entered into an interest rate swap agreement with Wells Fargo, effectively fixing the interest rate on $240.0 million, or 67%, of the Term Loan principal outstanding as of September 30, 2015.

Revolving Credit Facility

The Revolving Credit Facility provides up to $125.0 million of revolving credit loans or letters of credit with the use of proceeds restricted solely for working capital and other general corporate purposes. Under the Revolving Credit Facility, revolving loans are available based on a base rate (as defined in the Credit Agreement) or LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”). The Company is required to pay a commitment fee of 0.50% per annum on the unused portion of the Revolving Credit Facility, with such commitment fee to be reduced based upon the Company’s total leverage ratio as defined in the Credit Agreement. The maximum letter of credit capacity under the new revolving credit facility is $50.0 million and the Credit Agreement provides for a letter of credit fee equal to the applicable margin for LIBOR loans under the Revolving Credit Facility. Interest only payments are due either monthly or on the last day of any interest period, as applicable. At September 30, 2015, there were no borrowings outstanding on the Revolving Credit Facility. The availability under the Revolving Credit Facility was $118.2 million with $6.8 million of the Revolving Credit Facility issued in the form of standby letters of credit utilized as collateral for closure and post-closure financial assurance and other assurance obligations.

Except as set forth below, the Company may prepay the Term Loan or permanently reduce the Revolving Credit Facility commitment under the Credit Agreement at any time without premium or penalty (other than customary “breakage” costs with respect to the early termination of LIBOR loans). On or prior to six months after the closing of the Credit Agreement, if we prepay the initial term loans or amend the pricing terms of the initial term loans, in each case in connection with a reduction of the effective yield, we are required to pay a 1% prepayment premium (unless in connection with a change of control, sale or permitted acquisition). Subject to certain exceptions, the Credit Agreement provides for mandatory prepayment upon certain asset dispositions, casualty events and issuances of indebtedness. The Credit Agreement is also subject to mandatory annual prepayments commencing in December 2015 if our total leverage (defined as the ratio of our consolidated funded debt as of the last day of the applicable fiscal year to our adjusted EBITDA for such period) exceeds certain ratios as follows: 50% of our adjusted excess cash flow (as defined in the Credit Agreement and which takes into account certain adjustments) if our total leverage ratio is greater than 2.50 to 1.00, with step-downs to 0% if our total leverage ratio is equal to or less than 2.50 to 1.00.

Pursuant to (i) an unconditional guarantee agreement (the “Guarantee”) and (ii) a collateral agreement (the “Collateral Agreement”), each entered into by the Company and its domestic subsidiaries on June 17, 2014, the Company’s obligations under the Credit Agreement are jointly and severally and fully and unconditionally guaranteed on a senior basis by all of the Company’s existing and certain future domestic subsidiaries and the Credit Agreement is secured by substantially all of the Company’s and its domestic subsidiaries’ assets except the Company’s and its domestic subsidiaries’ real property.

The Credit Agreement contains customary restrictive covenants, subject to certain permitted amounts and exceptions, including covenants limiting the ability of the Company to incur additional indebtedness, pay dividends and make other restricted payments, repurchase shares of our outstanding stock and create certain liens. We may only declare quarterly or annual dividends if on the date of declaration, no event of default has occurred and no other event or condition has occurred that would constitute default due to the payment of the dividend.

The Credit Agreement also contains a financial maintenance covenant, which is a maximum Consolidated Senior Secured Leverage Ratio, as defined in the Credit Agreement, and is only applicable to the Revolving Credit Facility. Our Consolidated Senior Secured Leverage Ratio as of the last day of any fiscal quarter, commencing with June 30, 2014, may not exceed the ratios indicated below:

Fiscal Quarters Ending	Maximum Ratio
June 30, 2014 through September 30, 2015	4.00 to 1.00
December 31, 2015 through September 30, 2016	3.75 to 1.00
December 31, 2016 through September 30, 2017	3.50 to 1.00
December 31, 2017 through September 30, 2018	3.25 to 1.00
December 31, 2018 and thereafter	3.00 to 1.00

At September 30, 2015, we were in compliance with all of the financial covenants in the Credit Agreement.

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Oct. 30, 2015
Document and Entity Information
Entity Registrant Name	US ECOLOGY, INC.
Entity Central Index Key	0000742126
Document Type	10-Q
Document Period End Date	Sep. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q3
Trading Symbol	ECOL
Entity Common Stock, Shares Outstanding		21,735,305

XML

CLOSURE AND POST-CLOSURE OBLIGATIONS

9 Months Ended

Sep. 30, 2015

CLOSURE AND POST-CLOSURE OBLIGATIONS

CLOSURE AND POST-CLOSURE OBLIGATIONS

NOTE 11.CLOSURE AND POST-CLOSURE OBLIGATIONS

Our accrued closure and post-closure obligations represent the expected future costs, including corrective actions, associated with closure and post-closure of our operating and non-operating disposal facilities. Liabilities are recorded when work is probable and the costs can be reasonably estimated. We perform periodic reviews of both non-operating and operating facilities and revise accruals for estimated closure and post-closure, remediation or other costs as necessary. Recorded liabilities are based on our best estimates of current costs and are updated periodically to include the effects of existing technology, presently enacted laws and regulations, inflation and other economic factors.

Changes to closure and post-closure obligations consisted of the following:

	Three Months Ended			Nine Months Ended
$s in thousands	September 30, 2015			September 30, 2015
Closure and post-closure obligations, beginning of period	$	72,690		$	72,870
Accretion expense	1,132			3,208
Payments	(2,250		)	(4,386		)
Currency translation	(109		)	(229		)
Closure and post-closure obligations, end of period	71,463			71,463
Less current portion	(4,402		)	(4,402		)
Long-term portion	$	67,061		$	67,061

XML

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
CONSOLIDATED STATEMENTS OF OPERATIONS
Revenue	$ 148,414	$ 170,864	$ 424,797	$ 290,237
Direct operating costs	102,474	118,556	297,543	190,664
Gross profit	45,940	52,308	127,254	99,573
Selling, general and administrative expenses	23,507	25,508	71,075	46,271
Impairment charges			6,700
Operating income	22,433	26,800	49,479	53,302
Other income (expense):
Interest income	17	11	64	94
Interest expense	(5,081)	(4,543)	(16,208)	(5,488)
Foreign currency loss	(994)	(830)	(1,769)	(1,027)
Other	387	301	1,156	557
Total other expense	(5,671)	(5,061)	(16,757)	(5,864)
Income before income taxes	16,762	21,739	32,722	47,438
Income tax expense	6,858	8,406	14,815	17,880
Net income	$ 9,904	$ 13,333	$ 17,907	$ 29,558
Earnings per share:
Basic (in dollars per share)	$ 0.46	$ 0.62	$ 0.83	$ 1.37
Diluted (in dollars per share)	$ 0.46	$ 0.61	$ 0.82	$ 1.37
Shares used in earnings per share calculation:
Basic (in shares)	21,655	21,570	21,619	21,526
Diluted (in shares)	21,749	21,680	21,723	21,649
Dividends paid per share (in dollars per share)	$ 0.18	$ 0.18	$ 0.54	$ 0.54

XML

CONCENTRATIONS AND CREDIT RISK

9 Months Ended

Sep. 30, 2015

CONCENTRATIONS AND CREDIT RISK

CONCENTRATIONS AND CREDIT RISK

NOTE 5.CONCENTRATIONS AND CREDIT RISK

Major Customers

No customer accounted for more than 10% of total revenue for the three or nine months ended September 30, 2015. Revenue from a single customer accounted for approximately 12% and 10% of total revenue for the three and nine months ended September 30, 2014, respectively. No customer accounted for more than 10% of total trade receivables as of September 30, 2015 or December 31, 2014.

Credit Risk Concentration

We maintain most of our cash and cash equivalents with nationally recognized financial institutions like Wells Fargo Bank, National Association (“Wells Fargo”) and Comerica, Inc. Substantially all balances are uninsured and are not used as collateral for other obligations. Concentrations of credit risk on accounts receivable are believed to be limited due to the number, diversification and character of the obligors and our credit evaluation process.

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

9 Months Ended

Sep. 30, 2015

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

NOTE 4. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in accumulated other comprehensive income (loss) (“AOCI”) consisted of the following:

	Foreign Currency Translation			Unrealized Loss on Interest Rate Hedge			Total
Balance at December 31, 2014	$	(5,648	)	$	(2,038	)	$	(7,686	)
Other comprehensive loss before reclassifications, net of tax	(6,761		)	(3,706		)	(10,467		)
Amounts reclassified out of AOCI, net of tax (1)	—			1,715			1,715
Other comprehensive loss	(6,761		)	(1,991		)	(8,752		)
Balance at September 30, 2015	$	(12,409	)	$	(4,029	)	$	(16,438	)

(1) Before-tax reclassifications of $871,000 ($566,000 after-tax) and $2.6 million ($1.7 million after-tax) for the three and nine months ended September 30, 2015, respectively, were included in Interest expense in the Company’s consolidated statements of operations. Amount relates to interest rate swap which is designated as a cash flow hedge. Changes in fair value of the swap recognized in AOCI are reclassified to interest expense when hedged interest payments on the underlying debt are made. Amounts in AOCI expected to be recognized in interest expense over the next 12 months total approximately $3.5 million ($2.3 million after tax).

XML

OPERATING SEGMENTS

9 Months Ended

Sep. 30, 2015

OPERATING SEGMENTS

OPERATING SEGMENTS

NOTE 16.   OPERATING SEGMENTS

Financial Information by Segment

Our operations are managed in two reportable segments reflecting our internal reporting structure and nature of services offered as follows:

Environmental Services - This segment includes all of the legacy US Ecology operations and the legacy EQ treatment and disposal facilities. It provides a broad range of hazardous material management services including transportation, recycling, treatment and disposal of hazardous and non-hazardous waste at Company-owned landfill, wastewater and other treatment facilities.

Field & Industrial Services - This segment includes all of the field and industrial service business of the legacy EQ operation. It provides packaging and collection of hazardous waste and total waste management solutions at customer sites and through our 10-day transfer facilities. Services include on-site management, waste characterization, transportation and disposal of non-hazardous and hazardous waste. This segment also provides specialty services such as high-pressure and chemical cleaning, centrifuge and materials processing, tank cleaning, decontamination, remediation, transportation, spill cleanup and emergency response and other services to commercial and industrial facilities and to government entities.

The operations not managed through our two reportable segments are recorded as “Corporate.” Corporate selling, general and administrative expenses include typical corporate items such as legal, accounting and other items of a general corporate nature. Income taxes are assigned to Corporate, but all other items are included in the segment where they originated. Inter-company transactions have been eliminated from the segment information and are not significant between segments.

Summarized financial information of our reportable segments is as follows:

	Three Months Ended September 30, 2015
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	76,079	$	—	$	—	$	76,079
Services Revenue:
Transportation and Logistics (1)	20,191		5,694		—		25,885
Industrial Cleaning (2)	—		27,532		—		27,532
Technical Services (3)	—		16,584		—		16,584
Remediation (4)	—		1,253		—		1,253
Other (5)	—		1,081		—		1,081
Total Revenue	$	96,270	$	52,144	$	—	$	148,414
Depreciation, amortization and accretion	$	8,664	$	1,885	$	126	$	10,675
Capital expenditures	$	4,480	$	1,401	$	436	$	6,317
Total assets	$	599,136	$	201,627	$	62,613	$	863,376

	Three Months Ended September 30, 2014
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	84,778	$	—	$	—	$	84,778
Services Revenue:
Transportation and Logistics (1)	23,256		11,657		—		34,913
Industrial Cleaning (2)	—		22,142		—		22,142
Technical Services (3)	—		15,985		—		15,985
Remediation (4)	—		11,814		—		11,814
Other (5)	—		1,232		—		1,232
Total Revenue	$	108,034	$	62,830	$	—	$	170,864
Depreciation, amortization and accretion	$	9,748	$	3,271	$	276	$	13,295
Capital expenditures	$	4,924	$	3,822	$	506	$	9,252
Total assets	$	627,340	$	229,971	$	59,838	$	917,149

	Nine Months Ended September 30, 2015
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	224,007	$	—	$	—	$	224,007
Services Revenue:
Transportation and Logistics (1)	54,878		19,986		—		74,864
Industrial Cleaning (2)	—		69,980		—		69,980
Technical Services (3)	—		46,807		—		46,807
Remediation (4)	—		5,492		—		5,492
Other (5)	—		3,647		—		3,647
Total Revenue	$	278,885	$	145,912	$	—	$	424,797
Depreciation, amortization and accretion	$	26,167	$	7,920	$	405	$	34,492
Capital expenditures	$	17,564	$	6,250	$	1,879	$	25,693
Total assets	$	599,136	$	201,627	$	62,613	$	863,376

	Nine Months Ended September 30, 2014
$s in thousands	Environmental Services		Field & Industrial Services		Corporate		Total
Treatment & Disposal Revenue	$	178,254	$	—	$	—	$	178,254
Services Revenue:
Transportation and Logistics (1)	41,012		12,895		—		53,907
Industrial Cleaning (2)	—		25,827		—		25,827
Technical Services (3)	—		17,994		—		17,994
Remediation (4)	—		12,841		—		12,841
Other (5)	—		1,414		—		1,414
Total Revenue	$	219,266	$	70,971	$	—	$	290,237
Depreciation, amortization and accretion	$	19,415	$	3,759	$	464	$	23,638
Capital expenditures	$	12,751	$	4,410	$	749	$	17,910
Total assets	$	627,340	$	229,971	$	59,838	$	917,149

(1) Includes such services as collection, transportation and disposal of non-hazardous and hazardous waste. Prior to the acquisition of EQ on June 17, 2014, services within Environmental Services included transportation services.

(2) Includes such services as industrial cleaning and maintenance for utilities, refineries, chemical plants, pulp and paper mills, steel and automotive plants, and refinery services such as tank cleaning, centrifuge and temporary storage.

(3) Includes such services as Total Waste Management (“TWM”) programs, retail services, laboratory packing, less-than-truck-load (“LTL”) service and Household Hazardous Waste (“HHW”) collection.

(4) Includes such services as site assessment, onsite treatment, project management and remedial action planning and execution.

(5) Includes such services as emergency response and marine.

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”)

The primary financial measure used by management to assess segment performance is Adjusted EBITDA. Adjusted EBITDA is defined as net income before net interest expense, income tax expense, depreciation, amortization, stock based compensation, accretion of closure and post-closure liabilities, foreign currency gain/loss, non-cash impairment charges and other income/expense, which are not considered part of usual business operations. Adjusted EBITDA is a complement to results provided in accordance with GAAP and we believe that such information provides additional useful information to analysts, stockholders and other users to understand the Company’s operating performance. Since Adjusted EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies. Items excluded from Adjusted EBITDA are significant components in understanding and assessing our financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or a substitute for analyzing our results as reported under GAAP. Some of the limitations are:

· Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

· Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt;

· Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes;

· Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; and

· Although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

A reconciliation of Adjusted EBITDA to Net Income is as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
$s in thousands	2015			2014			2015			2014
Adjusted EBITDA:
Environmental Services	$	39,244		$	45,483		$	112,859		$	94,966
Field & Industrial Services	5,611			6,136			13,709			7,256
Corporate	(11,101		)	(11,180		)	(34,161		)	(24,413		)
Total	33,754			40,439			92,407			77,809
Reconciliation to Net income:
Income tax expense	(6,858		)	(8,406		)	(14,815		)	(17,880		)
Interest expense	(5,081		)	(4,543		)	(16,208		)	(5,488		)
Interest income	17			11			64			94
Foreign currency loss	(994		)	(830		)	(1,769		)	(1,027		)
Other income	387			301			1,156			557
Impairment charges	—			—			(6,700		)	—
Depreciation and amortization of plant and equipment	(6,591		)	(8,318		)	(21,726		)	(16,730		)
Amortization of intangibles	(2,952		)	(4,018		)	(9,558		)	(5,233		)
Stock-based compensation	(646		)	(344		)	(1,736		)	(869		)
Accretion and non-cash adjustment of closure & post-closure liabilities	(1,132		)	(959		)	(3,208		)	(1,675		)
Net income	$	9,904		$	13,333		$	17,907		$	29,558

Revenue, Property and Equipment and Intangible Assets Outside of the United States

We provide services in the United States and Canada. Revenues by geographic location where the underlying services were performed were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
$s in thousands	2015		2014		2015		2014
United States	$	138,367	$	155,043	$	392,698	$	243,689
Canada	10,047		15,821		32,099		46,548
Total revenue	$	148,414	$	170,864	$	424,797	$	290,237

Long-lived assets, comprised of property and equipment and intangible assets net of accumulated depreciation and amortization, by geographic location are as follows:

	September 30,		December 31,
$s in thousands	2015		2014
United States	$	396,295	$	446,412
Canada	51,279		59,939
Total long-lived assets	$	447,574	$	506,351

XML

INCOME TAXES

9 Months Ended

Sep. 30, 2015

INCOME TAXES

INCOME TAXES

NOTE 12.INCOME TAXES

Our effective tax rate for the three months ended September 30, 2015 was 40.9%, up from 38.7% for the three months ended September 30, 2014. Our effective tax rate for the nine months ended September 30, 2015 was 45.3%, up from 37.7% for the nine months ended September 30, 2014. The increase for the three months ended September 30, 2015 primarily reflects a lower proportion of earnings from our Canadian operations, which are taxed at a lower corporate rate, partially offset by lower non-tax deductible business development expenses. The increase for the nine months ended September 30, 2015 primarily reflects non-deductible impairment charges of $6.7 million, and a lower proportion of earnings from our Canadian operations, which are taxed at a lower corporate rate, partially offset by lower non-tax deductible business development expenses.

We file a consolidated U.S. federal income tax return with the Internal Revenue Service as well as income tax returns in various states and Canada. We may be subject to examination by taxing authorities in the U.S. and Canada for tax years 2011 through 2014. Additionally, we may be subject to examinations by various state and local taxing jurisdictions for tax years 2010 through 2014.

XML

PROPERTY AND EQUIPMENT

9 Months Ended

Sep. 30, 2015

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

NOTE 8.PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

	September 30,			December 31,
$s in thousands	2015			2014
Cell development costs	$	120,032		$	120,878
Land and improvements	31,811			33,002
Buildings and improvements	69,883			74,518
Railcars	17,375			17,375
Vehicles and other equipment	86,527			98,877
Construction in progress	18,879			10,831
Total property and equipment	344,507			355,481
Accumulated depreciation and amortization	(140,120		)	(127,797		)
Property and equipment, net	$	204,387		$	227,684

Depreciation and amortization expense for the three months ended September 30, 2015 and 2014 was $6.6 million and $8.3 million, respectively. Depreciation and amortization expense for the nine months ended September 30, 2015 and 2014 was $21.7 million and $16.7 million, respectively.

XML

RECEIVABLES

9 Months Ended

Sep. 30, 2015

RECEIVABLES

RECEIVABLES

NOTE 6.RECEIVABLES

Receivables consisted of the following:

	September 30,			December 31,
$s in thousands	2015			2014
Trade	$	77,593		$	116,218
Unbilled revenue	27,703			17,857
Other	2,059			1,890
Total receivables	107,355			135,965
Allowance for doubtful accounts	(3,072		)	(704		)
Receivables, net	$	104,283		$	135,261

XML

FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2015

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

NOTE 7.FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are categorized using defined hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair value measurements, as follows:

Level 1 - Quoted prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable;

Level 3 - Unobservable inputs in which little or no market activity exists, requiring an entity to develop its own assumptions that market participants would use to value the asset or liability.

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, restricted cash and investments, accounts payable, accrued liabilities, debt and interest rate swap agreements. The estimated fair value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to the short-term nature of these instruments.

The Company estimates the fair value of its variable-rate debt using Level 2 inputs, such as interest rates, related terms and maturities of similar obligations. The fair value of the Company’s debt approximated its carrying amount as of September 30, 2015.

The Company’s assets and liabilities measured at fair value on a recurring basis consisted of the following:

	September 30, 2015
	Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	401	$	3,614	$	—	$	4,015
Money market funds (2)	1,758		—		—		1,758
Total	$	2,159	$	3,614	$	—	$	5,773
Liabilities:
Interest rate swap agreement (3)	$	—	$	6,199	$	—	$	6,199
Total	$	—	$	6,199	$	—	$	6,199

	December 31, 2014
	Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
$s in thousands	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Fixed-income securities (1)	$	400	$	3,590	$	—	$	3,990
Money market funds (2)	1,739		—		—		1,739
Total	$	2,139	$	3,590	$	—	$	5,729
Liabilities:
Interest rate swap agreement (3)	$	—	$	3,136	$	—	$	3,136
Total	$	—	$	3,136	$	—	$	3,136

(1) We invest a portion of our Restricted cash and investments in fixed-income securities, including U.S. Treasury and U.S. agency securities. We measure the fair value of U.S. Treasury securities using quoted prices for identical assets in active markets. We measure the fair value of U.S. agency securities using observable market activity for similar assets. The fair value of our fixed-income securities approximates our cost basis in the investments.

(2) We invest a portion of our Restricted cash and investments in money market funds. We measure the fair value of these money market fund investments using quoted prices for identical assets in active markets.

(3) In order to manage interest rate exposure, we entered into an interest rate swap agreement in October 2014 that effectively converts a portion of our variable-rate debt to a fixed interest rate. The swap is designated as a cash flow hedge, with gains and losses deferred in other comprehensive income to be recognized as an adjustment to interest expense in the same period that the hedged interest payments affect earnings. The interest rate swap has an effective date of December 31, 2014 with an initial notional amount of $250.0 million. The fair value of the interest rate swap agreement represents the difference in the present value of cash flows calculated (i) at the contracted interest rates and (ii) at current market interest rates at the end of the period. We calculate the fair value of interest rate swap agreements quarterly based on the quoted market price for the same or similar financial instruments. The fair value of the interest rate swap agreement is included in Other long-term liabilities in the Company’s consolidated balance sheet.

XML

GOODWILL AND INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2015

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS

NOTE 9.GOODWILL AND INTANGIBLE ASSETS

Changes in goodwill for the nine months ended September 30, 2015 consisted of the following:

$s in thousands	Environmental Services			Field & Industrial Services			Total
Balance at December 31, 2014 (1)	$	152,396		$	65,213		$	217,609
Impairment charges (2)	—			(6,700		)	(6,700		)
Classified as held for sale (3)	—			(13,572		)	(13,572		)
Foreign currency translation	(2,512		)	—			(2,512		)
Balance at September 30, 2015	$	149,884		$	44,941		$	194,825

(1) Balances have been revised to reflect purchase accounting measurement period adjustments related to the acquisition of EQ as disclosed in Note 2.

(2) As disclosed in Notes 3, on August 4, 2015, we entered into a definitive agreement to sell Allstate to a private investor group for approximately $58.0 million cash, subject to adjustments for working capital and capital expenditures. Allstate represents the majority of the industrial services business we acquired with the acquisition of EQ. As a result of this agreement and management’s strategic review, we evaluated the recoverability of the assets associated with our industrial services business. Based on this analysis, we recorded a non-cash goodwill impairment charge of $6.7 million, or $0.31 per diluted share, in the second quarter of 2015. We calculated the estimated fair value of the industrial services business using a combination of quoted market prices and discounted cash flows.

(3) Amounts relate to sale of Allstate as disclosed in Note 3.

Intangible assets, net consisted of the following:

	September 30, 2015							December 31, 2014
$s in thousands	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Amortizing intangible assets:
Permits, licenses and lease	$	110,357	$	(6,085	)	$	104,272	$	113,693	$	(4,427	)	$	109,266
Customer relationships	82,124		(7,728		)	74,396		103,086		(4,488		)	98,598
Technology - formulae and processes	6,790		(1,037		)	5,753		7,844		(1,009		)	6,835
Customer backlog	3,652		(469		)	3,183		4,600		(246		)	4,354
Tradename	4,318		(1,850		)	2,468		5,481		(979		)	4,502
Developed software	2,908		(605		)	2,303		3,745		(428		)	3,317
Non-compete agreements	732		(610		)	122		920		(462		)	458
Internet domain and website	540		(36		)	504		869		(24		)	845
Database	388		(79		)	309		667		(72		)	595
Total amortizing intangible assets	211,809		(18,499		)	193,310		240,905		(12,135		)	228,770
Nonamortizing intangible assets:
Permits and licenses	49,750		—			49,750		49,750		—			49,750
Tradename	127		—			127		147		—			147
Total intangible assets, net	$	261,686	$	(18,499	)	$	243,187	$	290,802	$	(12,135	)	$	278,667

Amortization expense for the three months ended September 30, 2015 and 2014 was $3.0 million and $4.0 million, respectively. Amortization expense for the nine months ended September 30, 2015 and 2014 was $9.6 million and $5.2 million, respectively. Foreign intangible asset carrying amounts are affected by foreign currency translation.

XML

CLOSURE AND POST-CLOSURE OBLIGATIONS (Tables)

9 Months Ended

Sep. 30, 2015

CLOSURE AND POST-CLOSURE OBLIGATIONS

Schedule of changes in closure and post-closure obligations

	Three Months Ended			Nine Months Ended
$s in thousands	September 30, 2015			September 30, 2015
Closure and post-closure obligations, beginning of period	$	72,690		$	72,870
Accretion expense	1,132			3,208
Payments	(2,250		)	(4,386		)
Currency translation	(109		)	(229		)
Closure and post-closure obligations, end of period	71,463			71,463
Less current portion	(4,402		)	(4,402		)
Long-term portion	$	67,061		$	67,061

XML

EQUITY (Details) - USD ($)			9 Months Ended
	May. 27, 2015	Jan. 01, 2015	Sep. 30, 2015
Omnibus Plan
Stock-Based Compensation Plans
Number of shares authorized for grant	1,500,000
PSUs
Stock-Based Compensation Plans
Performance Stock Units granted	6,929
Weighted-average grant-date fair value (per unit)	$ 65.78
Performance period		3 years
Assumptions used in Monte Carlo simulation
Expected volatility			29.30%
Stock price on grant date			$ 46.89
Risk-free interest rate			0.86%
Expected term (years)			2 years 7 months 6 days
Expected dividend yield			1.50%
PSUs | Minimum
Stock-Based Compensation Plans
Percentage payout rate	0.00%
PSUs | Maximum
Stock-Based Compensation Plans
Percentage payout rate	200.00%
Stock options
Stock-Based Compensation Plans
Number of options exercised (in shares)			73,601
Weighted-average exercise price of options exercised (in dollars per share)			$ 24.05
Number of options exercised via share settlement			3,334
Restricted stock
Stock-Based Compensation Plans
Issuance of restricted stock from treasury stock (in shares)			6,583
Average cost (in dollars per share)			$ 44.34

XML

EQUITY

9 Months Ended

Sep. 30, 2015

EQUITY

EQUITY

NOTE 14.EQUITY

Omnibus Incentive Plan

On May 27, 2015, our stockholders approved the Omnibus Incentive Plan (“Omnibus Plan”), which was approved by our Board of Directors on April 7, 2015. The Omnibus Plan provides, among other things, the ability for the Company to grant restricted stock, performance stock, options, stock appreciation rights, restricted stock units, performance stock units (“PSUs”) and other stock-based awards or cash awards to officers, employees, consultants and non-employee directors. We will cease to grant equity awards under our 2008 Stock Option Incentive Plan and our 2006 Restricted Stock Plan (“Previous Plans”), and the Previous Plans will remain in effect solely for the settlement of awards granted under the Previous Plans. No shares that are reserved but unissued under the Previous Plans or that are outstanding under the Previous Plans and reacquired by the Company for any reason will be available for issuance under the Omnibus Plan. The Omnibus Plan expires on April 7, 2025 and authorizes 1.5 million shares of common stock for grant over the life of the Omnibus Plan.

Performance Stock Units

On May 27, 2015, the Company granted 6,929 PSUs to certain employees. Each PSU represents the right to receive, on the settlement date, one share of the Company’s common stock. The total number of PSUs each participant is eligible to earn ranges from 0% to 200% of the target number of PSUs granted. The actual number of PSUs that will vest and be settled in shares is determined at the end of a three-year performance period beginning January 1, 2015, based on total stockholder return relative to a set of peer companies. The fair value of the PSUs estimated on the grant date using a Monte Carlo simulation was $65.78 per unit. Compensation expense is recorded over the awards’ vesting period.

The following table presents the assumptions used in the Monte Carlo simulation to calculate the fair value of the PSUs granted on May 27, 2015:

Expected volatility	29.30		%
Stock price on grant date	$	46.89
Risk-free interest rate	0.86		%
Expected term (years)	2.6
Expected dividend yield	1.50		%

Stock Options and Restricted Stock

During the nine months ended September 30, 2015, option holders exercised 73,601 options with a weighted-average exercise price of $24.05 per option. Option holders exercised 3,334 of these options via net share settlement. During the nine months ended September 30, 2015, the Company issued 6,583 shares of restricted stock from our treasury stock at an average cost of $44.34 per share.

XML

BUSINESS COMBINATION (Tables)

9 Months Ended

Sep. 30, 2015

BUSINESS COMBINATION

Summary of consideration paid and the preliminary fair value of assets acquired and liabilities assumed at the acquisition date with purchase price allocation adjustments

The following table summarizes the consideration paid for EQ and the fair value estimates of assets acquired and liabilities assumed recognized at the acquisition date, with purchase price allocation adjustments since the preliminary purchase price allocation as previously disclosed as of December 31, 2014:

	Purchase Price Allocation
$s in thousands	As Reported in Form 10-K			Adjustments			As Retrospectively Adjusted
Current assets	$	111,982		$	27		$	112,009
Property and equipment	101,543			—			101,543
Identifiable intangible assets	252,874			—			252,874
Current liabilities	(57,585		)	(727		)	(58,312		)
Other liabilities	(139,331		)	263			(139,068		)
Total identifiable net assets	269,483			(437		)	269,046
Goodwill	197,163			437			197,600
Total purchase price	$	466,646		$	—		$	466,646

Schedule of fair value estimate of identifiable intangible assets by major intangible assets and related weighted average amortization period

$s in thousands	Fair Value		Weighted Average Amortization Period (Years)
Customer relationships	$	98,400	15
Permits and licenses	89,600		45
Permits and licenses, nonamortizing	49,000		—
Tradename	5,481		3
Customer backlog	4,600		10
Developed software	3,443		9
Non-compete agreements	900		1
Internet domain and website	869		19
Database	581		15
Total identifiable intangible assets	$	252,874

Schedule of unaudited pro forma financial information

	(unaudited)		(unaudited)
	Three Months Ended		Nine Months Ended
$s in thousands, except per share amounts	September 30, 2014		September 30, 2014
Pro forma combined:
Revenue	$	170,894	$	458,091
Net income	$	13,333	$	24,835
Earnings per share
Basic	$	0.62	$	1.15
Diluted	$	0.61	$	1.15

XML

INCOME TAXES (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
INCOME TAXES
Effective tax rate (as a percent)	40.90%	38.70%	45.30%	37.70%
Impairment charges not deductible for tax purposes			$ 6.7

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details 2) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Reclassification adjustments
Interest expense	$ 5,081	$ 4,543	$ 16,208	$ 5,488
Unrealized Loss on Interest Rate Hedge | Interest rate swap agreement | Reclassification out of accumulated other comprehensive income
Reclassification adjustments
Interest expense	871,000		2,600
Interest expense, net of tax	566,000		1,700
Amounts in AOCI expected to be recognized over the next 12 months before tax	3,500		3,500
Amounts in AOCI expected to be recognized over the next 12 months, net of taxes	$ 2,300		$ 2,300

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 9,904	$ 13,333	$ 17,907	$ 29,558
Other comprehensive income (loss):
Foreign currency translation loss	(3,590)	(2,156)	(6,761)	(2,078)
Net changes in interest rate hedge, net of taxes of ($981), $0, ($1,072) and $0, respectively	(1,821)		(1,991)
Comprehensive income, net of tax	$ 4,493	$ 11,177	$ 9,155	$ 27,480

XML

DISPOSITION

9 Months Ended

Sep. 30, 2015

DISPOSITION

DISPOSITION

NOTE 3.DISPOSITION

On August 4, 2015, we entered into a definitive agreement to sell Allstate to a private investor group for approximately $58.0 million cash, subject to adjustments for working capital and capital expenditures. Allstate represents the majority of the industrial services business and is included in our Field and Industrial Services segment, which we acquired with the acquisition of EQ. As a result of this agreement and management’s strategic review, we evaluated the recoverability of the assets associated with our industrial services business. Based on this analysis, we recorded a non-cash goodwill impairment charge of $6.7 million, or $0.31 per diluted share, in the second quarter of 2015. On November 1, 2015, we completed the sale of Allstate. The sale of Allstate does not meet the requirements to be reported as a discontinued operation as defined in ASU 2014-08. For additional information on the sale of Allstate, see Note 17.

Income before income taxes from Allstate included in the Company’s consolidated statements of operations for the three months ended September 30, 2015 and 2014 was $1.7 million and $265,000, respectively. For the nine months ended September 30, 2015 and 2014, loss before income taxes from Allstate was $5.7 million and income before income taxes from Allstate was $301,000, respectively. Loss before income taxes for the nine months ended September 30, 2015, includes a non-cash goodwill impairment charge of $6.4 million.

The carrying amounts of major classes of assets and liabilities of Allstate classified as held for sale in our consolidated balance sheet are as follows:

	September 30,
$s in thousands	2015
Receivables, net	$	22,340
Prepaid expenses and other current assets	1,555
Property and equipment, net	19,484
Intangible assets, net	21,824
Goodwill	13,572
Total assets held for sale	$	78,775
Accounts payable	6,108
Accrued liabilities	1,616
Accrued salaries and benefits	568
Deferred income taxes	11,948
Total liabilities held for sale	$	20,240

XML

DISPOSITION (Tables)

9 Months Ended

Sep. 30, 2015

DISPOSITION

Schedules of carrying amounts of assets and liabilities included in held for sale

	September 30,
$s in thousands	2015
Receivables, net	$	22,340
Prepaid expenses and other current assets	1,555
Property and equipment, net	19,484
Intangible assets, net	21,824
Goodwill	13,572
Total assets held for sale	$	78,775
Accounts payable	6,108
Accrued liabilities	1,616
Accrued salaries and benefits	568
Deferred income taxes	11,948
Total liabilities held for sale	$	20,240

XML

BUSINESS COMBINATION (Details) - USD ($)		3 Months Ended		9 Months Ended		12 Months Ended
	Jun. 17, 2014	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
BUSINESS ACQUISITIONS
Payment to acquire business, net of cash acquired					$ 465,895,000
Consideration paid and the fair value of assets acquired and liabilities assumed
Goodwill		$ 194,825,000		$ 194,825,000		$ 217,609,000
Field & Industrial Services
Consideration paid and the fair value of assets acquired and liabilities assumed
Goodwill		44,941,000		44,941,000		65,213,000
Environmental Services
Consideration paid and the fair value of assets acquired and liabilities assumed
Goodwill		149,884,000		149,884,000		152,396,000
EQ
BUSINESS ACQUISITIONS
Percentage of outstanding shares acquired	100.00%
Payment to acquire business, net of cash acquired	$ 460,900,000
Amount of term loan which was used to funded acquisition	415,000,000
Consideration paid and the fair value of assets acquired and liabilities assumed
Current assets						112,009,000
Property and equipment						101,543,000
Identifiable intangible assets	252,874,000					252,874,000
Current liabilities						(58,312,000)
Other liabilities						(139,068,000)
Total identifiable net assets						269,046,000
Goodwill		197,600,000		197,600,000		197,600,000
Total purchase price						466,646,000
Additional information
Revenue since acquisition included in consolidated statements of operations		95,000,000		268,800,000
Operating income since acquisition included in consolidated statements of operations		11,800,000		16,100,000
Acquisition-related costs included in selling, general and administrative expenses		150,000		1,100,000
Pro forma combined:
Revenue			$ 170,894,000		458,091,000
Net income			$ 13,333,000		$ 24,835,000
Earnings per share - Basic (in dollars per share)			$ 0.62		$ 1.15
Earnings per share - Diluted (in dollars per share)			$ 0.61		$ 1.15
EQ | Field & Industrial Services
Consideration paid and the fair value of assets acquired and liabilities assumed
Goodwill		65,200,000		65,200,000
EQ | Environmental Services
Consideration paid and the fair value of assets acquired and liabilities assumed
Goodwill		$ 132,400,000		$ 132,400,000
EQ | Permits and licenses
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	49,000,000
Previously Reported | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Current assets						111,982,000
Property and equipment						101,543,000
Identifiable intangible assets						252,874,000
Current liabilities						(57,585,000)
Other liabilities						(139,331,000)
Total identifiable net assets						269,483,000
Goodwill						197,163,000
Total purchase price						466,646,000
Adjustments | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Current assets						27,000
Current liabilities						(727,000)
Other liabilities (debit balance)						263,000
Total identifiable net assets						(437,000)
Goodwill						$ 437,000
Customer relationships | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	$ 98,400,000
Additional information
Weighted average amortization period	15 years
Permits and licenses | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	$ 89,600,000
Additional information
Weighted average amortization period	45 years
Tradename | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	$ 5,481,000
Additional information
Weighted average amortization period	3 years
Customer backlog | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	$ 4,600,000
Additional information
Weighted average amortization period	10 years
Developed software | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	$ 3,443,000
Additional information
Weighted average amortization period	9 years
Non-compete agreements | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	$ 900,000
Additional information
Weighted average amortization period	1 year
Internet domain and website | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	$ 869,000
Additional information
Weighted average amortization period	19 years
Database | EQ
Consideration paid and the fair value of assets acquired and liabilities assumed
Identifiable intangible assets	$ 581,000
Additional information
Weighted average amortization period	15 years

XML

EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2015

EARNINGS PER SHARE

EARNINGS PER SHARE

NOTE 13.EARNINGS PER SHARE

	Three Months Ended September 30,
$s and shares in thousands, except per share	2015				2014
amounts	Basic		Diluted		Basic		Diluted
Net income	$	9,904	$	9,904	$	13,333	$	13,333
Weighted average basic shares outstanding	21,655		21,655		21,570		21,570
Dilutive effect of stock-based awards			94				110
Weighted average diluted shares outstanding			21,749				21,680
Earnings per share	$	0.46	$	0.46	$	0.62	$	0.61
Anti-dilutive shares excluded from calculation			181				78

	Nine Months Ended September 30,
$s and shares in thousands, except per share	2015				2014
amounts	Basic		Diluted		Basic		Diluted
Net income	$	17,907	$	17,907	$	29,558	$	29,558
Weighted average basic shares outstanding	21,619		21,619		21,526		21,526
Dilutive effect of stock-based awards			104				123
Weighted average diluted shares outstanding			21,723				21,649
Earnings per share	$	0.83	$	0.82	$	1.37	$	1.37
Anti-dilutive shares excluded from calculation			192				50