BUSINESS COMBINATIONS (Tables)

3 Months Ended

Mar. 31, 2020

Schedule of preliminary fair value of identifiable intangible assets related to the acquisition of NRCG

	March 31, 2020						December 31, 2019
			Accumulated						Accumulated
$s in thousands	Cost		Amortization		Net		Cost		Amortization		Net
Amortizing intangible assets:
Permits, licenses and lease	$	172,668	$	(19,239)	$	153,429	$	174,339	$	(18,707)	$	155,632
Customer relationships		333,152		(41,781)		291,371		333,090		(35,254)		297,836
Technology - formulae and processes		6,421		(1,907)		4,514		6,964		(2,013)		4,951
Customer backlog		3,652		(2,113)		1,539		3,652		(2,022)		1,630
Tradename		10,390		(5,644)		4,746		10,390		(4,832)		5,558
Developed software		2,874		(1,936)		938		2,895		(1,884)		1,011
Non-compete agreements		5,506		(2,372)		3,134		5,455		(1,694)		3,761
Internet domain and website		536		(163)		373		536		(156)		380
Database		382		(191)		191		388		(191)		197
Total amortizing intangible assets		535,581		(75,346)		460,235		537,709		(66,753)		470,956
Non-amortizing intangible assets:
Permits and licenses		103,769		—		103,769		103,816		—		103,816
Tradename		120		—		120		130		—		130
Total intangible assets	$	639,470	$	(75,346)	$	564,124	$	641,655	$	(66,753)	$	574,902

NRC

Summary of total merger consideration

	November 1,
$s in thousands	2019
Fair value of US Ecology common stock issued (1)	$	581,101
Fair value of replacement warrants issued (2)		44,858
Fair value of replacement restricted stock units issued (3)		141
Fair value of replacement stock options (4)		360
Repayment of NRC’s term loan and revolving credit facility		398,373
Total merger consideration	$	1,024,833

(1) The fair value of US Ecology common stock issued was calculated based on 9,337,949 shares of US Ecology common stock multiplied by the closing price of US Ecology common stock of $62.23 per share on October 31, 2019, the day

immediately preceding the closing of the NRC Merger.

(2) The fair value of replacement warrants issued was calculated based on 3,772,753 replacement warrants multiplied by the fair value per warrant of $11.89. The fair value per warrant was based on the closing price of the replaced NRC warrants (NYSE: NRCG.WS) of $2.33 on October 31, 2019, the day immediately preceding the closing of the NRC Merger, divided by the exchange ratio of 0.196 pursuant to the Merger Agreement.

(3) The fair value of replacement restricted stock units issued was calculated based on 118,239 replacement restricted stock units multiplied by the closing price of US Ecology common stock of $62.23 per share on October 31, 2019, the day immediately preceding the closing of the NRC Merger, further multiplied by the ratio of the precombination service period to the remaining vesting period, or approximately 1.9%.

(4) The fair value of replacement stock options issued was calculated based on 29,400 replacement stock options multiplied by the fair value per option of $12.26. The fair value per option was calculated using the Black-Scholes option pricing model, with the following weighted-average assumptions: strike price of $52.30 per option, dividend yield of 1.2%; expected volatility of 28.9%; average risk-free interest rate of 1.5%; and an expected term of 1 year. The replacement stock options became fully vested at the merger date therefore the entire fair value is considered merger consideration.

Summary of preliminary fair value estimates of assets acquired and liabilities assumed

	December 31,				March 31,
$s in thousands	2019		Adjustments		2020
Current assets	$	131,653	$	—	$	131,653
Property and equipment		197,045		—		197,045
Identifiable intangible assets		303,600		—		303,600
Other assets		41,687		—		41,687
Current liabilities		(83,460)		(1,215)		(84,675)
Deferred income tax liabilities		(56,596)		194		(56,402)
Other liabilities		(57,581)		—		(57,581)
Total identifiable net assets		476,348		(1,021)		475,327
Goodwill		548,485		1,021		549,506
Total purchase price	$	1,024,833	$	—	$	1,024,833

Schedule of preliminary fair value of identifiable intangible assets related to the acquisition of NRCG

			Average
			Amortization
$s in thousands	Fair Value		Period (Years)
Amortizing intangible assets:
Customer relationships - noncontractual	$	193,700	14
Customer relationships - contractual		34,400	7
Permits and licenses		8,700	16
Tradenames		6,100	2
Non-compete agreements		3,300	2
Total identified amortizing intangible assets		246,200
Non-amortizing intangible assets:
Permits and licenses		57,400	n/a
Total identified intangible assets	$	303,600

Schedule of unaudited pro forma financial information

	(unaudited)
	Three Months Ended
$s in thousands	March 31, 2019
Pro forma combined:
Revenue		231,195
Net loss		(2,857)