GUARANTOR AND NON-GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION | GUARANTOR AND NON-GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION The 2020 Notes and the 2021 Notes (collectively, the "Notes") are guaranteed by substantially all of the Company’s subsidiaries organized in the United States. Each guarantor for the Notes is a 100% owned subsidiary of Clean Harbors, Inc. and its guarantee is both full and unconditional and joint and several. The guarantees are, however, subject to customary release provisions under which, in particular, the guarantee of any domestic restricted subsidiary will be released if the Company sells such subsidiary to an unrelated third party in accordance with the terms of the indentures which govern the Notes. The Notes are not guaranteed by the Company’s subsidiaries organized outside the United States. The following supplemental condensed consolidating financial information for the parent company, the guarantor subsidiaries and the non-guarantor subsidiaries, respectively, is presented in conformity with the requirements of Rule 3-10 of SEC Regulation S-X (“Rule 3-10”). Following is the condensed consolidating balance sheet at March 31, 2017 (in thousands): Clean Harbors, Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Total Assets: Cash and cash equivalents $ 51,726 $ 139,160 $ 106,480 $ — $ 297,366 Intercompany receivables 209,410 396,286 40,235 (645,931 ) — Accounts receivable, net — 400,764 79,280 — 480,044 Other current assets 1,033 235,715 59,592 (11,979 ) 284,361 Property, plant and equipment, net — 1,214,176 395,314 — 1,609,490 Investments in subsidiaries 2,849,584 563,331 — (3,412,915 ) — Intercompany debt receivable — 87,215 24,701 (111,916 ) — Goodwill — 417,224 52,636 — 469,860 Permits and other intangibles, net — 429,311 61,641 — 490,952 Other long-term assets 2,421 7,661 4,566 (1,068 ) 13,580 Total assets $ 3,114,174 $ 3,890,843 $ 824,445 $ (4,183,809 ) $ 3,645,653 Liabilities and Stockholders’ Equity: Current liabilities $ 22,063 $ 356,914 $ 121,583 $ (11,979 ) $ 488,581 Intercompany payables 390,812 245,871 9,248 (645,931 ) — Closure, post-closure and remedial liabilities, net — 148,992 16,397 — 165,389 Long-term obligations 1,633,968 — — — 1,633,968 Intercompany debt payable 3,701 21,000 87,215 (111,916 ) — Other long-term liabilities — 276,118 19,035 (1,068 ) 294,085 Total liabilities 2,050,544 1,048,895 253,478 (770,894 ) 2,582,023 Stockholders’ equity 1,063,630 2,841,948 570,967 (3,412,915 ) 1,063,630 Total liabilities and stockholders’ equity $ 3,114,174 $ 3,890,843 $ 824,445 $ (4,183,809 ) $ 3,645,653 Following is the condensed consolidating balance sheet at December 31, 2016 (in thousands): Clean Harbors, Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Total Assets: Cash and cash equivalents $ 51,417 $ 155,943 $ 99,637 $ — $ 306,997 Intercompany receivables 200,337 354,836 49,055 (604,228 ) — Accounts receivables, net — 417,029 79,197 — 496,226 Other current assets 3,096 234,408 69,257 (17,113 ) 289,648 Property, plant and equipment, net — 1,211,210 400,617 — 1,611,827 Investments in subsidiaries 2,851,571 580,124 — (3,431,695 ) — Intercompany debt receivable — 86,409 24,701 (111,110 ) — Goodwill — 412,638 52,516 — 465,154 Permits and other intangibles, net — 435,594 63,127 — 498,721 Other long-term assets 2,446 7,582 4,387 (1,068 ) 13,347 Total assets $ 3,108,867 $ 3,895,773 $ 842,494 $ (4,165,214 ) $ 3,681,920 Liabilities and Stockholders’ Equity: Current liabilities $ 21,805 $ 366,831 $ 133,145 $ (17,113 ) $ 504,668 Intercompany payables 365,848 237,058 1,322 (604,228 ) — Closure, post-closure and remedial liabilities, net — 150,682 15,640 — 166,322 Long-term obligations 1,633,272 — — — 1,633,272 Intercompany debt payable 3,701 21,000 86,409 (111,110 ) — Other long-term liabilities — 275,649 18,836 (1,068 ) 293,417 Total liabilities 2,024,626 1,051,220 255,352 (733,519 ) 2,597,679 Stockholders’ equity 1,084,241 2,844,553 587,142 (3,431,695 ) 1,084,241 Total liabilities and stockholders’ equity $ 3,108,867 $ 3,895,773 $ 842,494 $ (4,165,214 ) $ 3,681,920 Following is the consolidating statement of operations for the three months ended March 31, 2017 (in thousands): Clean Harbors, Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Total Revenues Service revenues $ — $ 443,305 $ 131,071 $ (14,162 ) $ 560,214 Product revenues — 116,650 15,331 (3,254 ) 128,727 Total revenues — 559,955 146,402 (17,416 ) 688,941 Cost of revenues (exclusive of items shown separately below) Service cost of revenues — 294,145 111,104 (14,162 ) 391,087 Product cost of revenues — 96,505 12,247 (3,254 ) 105,498 Total cost of revenues — 390,650 123,351 (17,416 ) 496,585 Selling, general and administrative expenses 24 92,171 20,026 — 112,221 Accretion of environmental liabilities — 2,055 235 — 2,290 Depreciation and amortization — 51,900 20,512 — 72,412 (Loss) income from operations (24 ) 23,179 (17,722 ) — 5,433 Other expense (146 ) (1,389 ) (14 ) — (1,549 ) Interest (expense) income (22,659 ) 119 (36 ) — (22,576 ) Equity in earnings of subsidiaries, net of taxes (7,637 ) (21,824 ) — 29,461 — Intercompany interest income (expense) — 1,297 (1,297 ) — — (Loss) income before (benefit) provision for income taxes (30,466 ) 1,382 (19,069 ) 29,461 (18,692 ) (Benefit) provision for income taxes (9,073 ) 9,637 2,137 — 2,701 Net loss (21,393 ) (8,255 ) (21,206 ) 29,461 (21,393 ) Other comprehensive income 6,051 6,051 5,032 (11,083 ) 6,051 Comprehensive loss $ (15,342 ) $ (2,204 ) $ (16,174 ) $ 18,378 $ (15,342 ) Following is the consolidating statement of operations for the three months ended March 31, 2016 (in thousands): Clean Harbors, Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Total Revenues Service revenues $ — $ 428,477 $ 114,023 $ (12,269 ) $ 530,231 Product revenues — 89,588 18,713 (2,449 ) 105,852 Total revenues — 518,065 132,736 (14,718 ) 636,083 Cost of revenues (exclusive of items shown separately below) Service cost of revenues — 282,964 103,291 (12,269 ) 373,986 Product cost of revenues — 79,354 13,388 (2,449 ) 90,293 Total cost of revenues — 362,318 116,679 (14,718 ) 464,279 Selling, general and administrative expenses 24 80,655 23,805 — 104,484 Accretion of environmental liabilities — 2,290 215 — 2,505 Depreciation and amortization — 48,695 20,207 — 68,902 (Loss) income from operations (24 ) 24,107 (28,170 ) — (4,087 ) Other expense — (88 ) (262 ) — (350 ) Interest (expense) income (20,143 ) 1,111 52 — (18,980 ) Equity in earnings of subsidiaries, net of taxes (8,771 ) (26,495 ) — 35,266 — Intercompany interest income (expense) — 5,159 (5,159 ) — — (Loss) income before (benefit) provision for income taxes (28,938 ) 3,794 (33,539 ) 35,266 (23,417 ) (Benefit) provision for income taxes (8,067 ) 12,565 (7,044 ) — (2,546 ) Net loss (20,871 ) (8,771 ) (26,495 ) 35,266 (20,871 ) Other comprehensive income 45,837 45,837 28,927 (74,764 ) 45,837 Comprehensive income $ 24,966 $ 37,066 $ 2,432 $ (39,498 ) $ 24,966 Following is the condensed consolidating statement of cash flows for the three months ended March 31, 2017 (in thousands): Clean Harbors, Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Total Net cash (used in) from operating activities $ (1,663 ) $ 41,144 $ 17,638 $ — $ 57,119 Cash flows from (used in) investing activities: Additions to property, plant and equipment — (33,136 ) (9,326 ) — (42,462 ) Proceeds from sales of fixed assets — 664 366 — 1,030 Acquisitions, net of cash acquired — (11,946 ) — — (11,946 ) Proceeds on sale of business 1,837 — 181 — 2,018 Costs to obtain or renew permits — (573 ) (178 ) — (751 ) Proceeds from sale of investments 243 — — — 243 Intercompany — (7,771 ) — 7,771 — Net cash from (used in) investing activities 2,080 (52,762 ) (8,957 ) 7,771 (51,868 ) Cash flows used in financing activities: Change in uncashed checks — (5,165 ) (2,392 ) — (7,557 ) Proceeds from exercise of stock options 46 — — — 46 Issuance of restricted shares, net of shares remitted (1,021 ) — — — (1,021 ) Repurchases of common stock (6,796 ) — — — (6,796 ) Deferred financing costs paid (108 ) — — — (108 ) Intercompany 7,771 — — (7,771 ) — Net cash used in financing activities (108 ) (5,165 ) (2,392 ) (7,771 ) (15,436 ) Effect of exchange rate change on cash — — 554 — 554 Increase (decrease) in cash and cash equivalents 309 (16,783 ) 6,843 — (9,631 ) Cash and cash equivalents, beginning of period 51,417 155,943 99,637 — 306,997 Cash and cash equivalents, end of period $ 51,726 $ 139,160 $ 106,480 $ — $ 297,366 Following is the condensed consolidating statement of cash flows for the three months ended March 31, 2016 (in thousands): Clean Harbors, Inc. Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Total Net cash from (used in) operating activities $ 47,201 $ (3,361 ) $ (4,551 ) $ — $ 39,289 Cash flows used in investing activities: Additions to property, plant and equipment — (64,754 ) (11,027 ) — (75,781 ) Proceeds from sales of fixed assets — 277 996 — 1,273 Acquisitions, net of cash acquired — (34,993 ) — — (34,993 ) Costs to obtain or renew permits — (465 ) (47 ) — (512 ) Intercompany — (6,423 ) — 6,423 — Investment in subsidiaries (250,625 ) — — 250,625 — Net cash used in investing activities (250,625 ) (106,358 ) (10,078 ) 257,048 (110,013 ) Cash flows from (used in) financing activities: Change in uncashed checks — (4,529 ) (689 ) — (5,218 ) Issuance of restricted shares, net of shares remitted (1,425 ) — — — (1,425 ) Repurchases of common stock (4,998 ) — — — (4,998 ) Deferred financing costs paid (2,190 ) — — — (2,190 ) Issuance of senior secured notes, including premium 250,625 250,625 — (250,625 ) 250,625 Intercompany 6,423 — — (6,423 ) — Net cash from (used in) financing activities 248,435 246,096 (689 ) (257,048 ) 236,794 Effect of exchange rate change on cash — — 4,567 — 4,567 Increase (decrease) in cash and cash equivalents 45,011 136,377 (10,751 ) — 170,637 Cash and cash equivalents, beginning of period 11,017 83,479 90,212 — 184,708 Cash and cash equivalents, end of period $ 56,028 $ 219,856 $ 79,461 $ — $ 355,345 |