GOODWILL AND OTHER INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

The changes to goodwill for the nine months ended September 30, 2014 were as follows (in thousands):



	2014
Balance at January 1, 2014	$	570,960
Acquired from acquisitions	5,018
Increase from adjustments during the measurement period related to Evergreen	4,288
Goodwill impairment charge	(123,414		)
Foreign currency translation	(7,275		)
Balance at September 30, 2014	$	449,577

At September 30, 2014 the total accumulated goodwill impairment charge was $123.4 million, all within the Oil Re-refining and Recycling segment.

The Company assesses goodwill for impairment on an annual basis as of December 31, or at an interim date when events or changes in the business environment would more likely than not reduce the fair value of a reporting unit below its carrying value. The Company conducted the annual impairment test of goodwill for all reporting units as of December 31, 2013 and determined that no adjustment to the carrying value of goodwill for any reporting unit was necessary because the fair value of each of the reporting units exceeded that reporting unit's respective carrying value.

During the first and second quarters of 2014, the Company considered both external and business specific circumstances impacting the Oil Re-refining and Recycling reporting unit and concluded that an interim goodwill impairment test was not necessary. However, as of September 30, 2014 and principally resulting from current decreases in the market prices of oil products sold by the reporting unit which negatively impact anticipated revenue and earnings levels, the Company concluded that an interim goodwill impairment test was required.

In performing Step I of the goodwill impairment test, the estimated fair value of the Oil Re-refining and Recycling reporting unit was determined using an income approach and was compared to the reporting unit's estimated carrying value as of September 30, 2014. Based on the results of that valuation, the carrying amount of the reporting unit, including $174.3 million of goodwill, exceeded the estimated fair value and as a result the Company performed Step II of the goodwill impairment test to determine the amount of goodwill impairment charge to be recorded.

Step II of the goodwill impairment test requires the Company to perform a theoretical purchase price allocation for the reporting unit to determine the implied fair value of goodwill and to compare the implied fair value of goodwill to the recorded amount of goodwill. The estimate of fair value requires significant judgment. Based on the results of the goodwill impairment test, the Company recognized a goodwill impairment charge of $123.4 million.

The factors contributing to the $123.4 million goodwill impairment charge principally relate to current decreases in the market prices of base and blended oil products. These factors caused us, relative to the 2013 impairment test, to lower assumptions for future revenues and profits of the business and adversely affected the estimated fair value of the reporting unit as of September 30, 2014.

The fair value of the Oil and Gas Field Services reporting unit exceeded its carrying value by more than 10% at December 31, 2013. The financial performance of this reporting unit, which had a goodwill balance of approximately $34.9 million at September 30, 2014, was affected in the nine months ended September 30, 2014 by pricing pressures and lower levels of overall activity in the markets and regions that the business serves.

During the interim periods of fiscal year 2014 and with respect to the Oil and Gas Field Services reporting unit, the Company has considered whether (i) the lower than anticipated results (ii) general economic and industry conditions, and (iii) reporting unit specific factors would more likely than not reduce the estimated fair values of its reporting units below their carrying values. The Company did not perform an interim test for impairment of goodwill related to the Oil and Gas Field Services reporting unit as it does not believe the factors impacting the performance of this reporting unit, through September 30, 2014, would more likely than not reduce the fair value below its carrying value.

Significant judgments and unobservable inputs categorized as level III in the fair value hierarchy are inherent in the annual impairment tests performed and include assumptions about the amount and timing of expected future cash flows, growth rates, and the determination of appropriate discount rates. The Company believes that the assumptions used in its annual and interim date impairment tests are reasonable, but variations in any of the assumptions may result in different calculations of fair values that could result in a material impairment charge.

The performance of the Company's reporting units will continue to be monitored. If the Company's reporting units do not achieve the financial performance that the Company expects, it is possible that an additional goodwill impairment charge may result. There can therefore be no assurance that future events will not result in an impairment of goodwill.

As a result of the goodwill impairment charge recorded by the Oil Re-refining and Recycling reporting unit during the third quarter, the Company also considered whether the reporting units' carrying values of finite-lived intangible and other long lived assets may not be entirely recoverable or whether the carrying value of certain indefinite lived intangibles were impaired. As a result of these analyses it was concluded that no impairment of intangible or other long lived assets exist.

Below is a summary of amortizable other intangible assets (in thousands):



	September 30, 2014							December 31, 2013
	Cost		Accumulated Amortization		Net		Weighted Average Remaining Amortization Period (in years)	Cost		Accumulated Amortization		Net		Weighted Average Remaining Amortization Period (in years)
Permits	$	157,408	$	54,110	$	103,298	20.1	$	157,327	$	50,858	$	106,469	19.6
Customer and supplier relationships	373,478		72,201		301,277		11.2	377,899		52,814		325,085		12.1
Other intangible assets	31,714		18,417		13,297		3.0	29,299		15,518		13,781		3.3
Total amortizable permits and other intangible assets	562,600		144,728		417,872		11.4	564,525		119,190		445,335		12.2
Trademarks and trade names	124,002		—		124,002		Indefinite	124,638		—		124,638		Indefinite
Total permits and other intangible assets	$	686,602	$	144,728	$	541,874		$	689,163	$	119,190	$	569,973

Amortization expense for the three and nine months ended September 30, 2014 was $9.1 million and $27.5 million, respectively. Amortization expense for the three and nine months ended September 30, 2013 was $8.8 million and $25.9 million, respectively.

Below is the expected future amortization of the net carrying amount of finite-lived intangible assets at September 30, 2014 (in thousands):



Years Ending December 31,	Expected Amortization
2014 (three months)	$	8,979
2015	35,687
2016	34,901
2017	32,923
2018	30,097
Thereafter	275,285
	$	417,872

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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