ECOLAB INC. (Form: 10-Q, Received: 08/03/2017 08:43:25)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2017

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 1-9328

ECOLAB INC.

(Exact name of registrant as specified in its charter)


Delaware		41-0231510
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

1 Ecolab Place, St. Paul, Minnesota 55102

(Address of principal executive offices)(Zip Code)

1-800-232-6522

(Registrant’s telephone number, including area code)

(Not applicable)

(Former name, former address and former fiscal year,

if changed since last report)

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 ☒ No ☐

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

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


Large accelerated filer ☒		Accelerated filer ☐

Non-accelerated filer ☐ (Do not check if a smaller reporting company)		Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of June 30, 2017.

289,381,301 shares of common stock, par value $1.00 per share .

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

CONSOLIDATED STATEMENT OF INCOME

(unaudited)



	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions, except per share amounts)	2017		2016		2017		2016

Net sales		$ 3,462.7		$ 3,317.2		$ 6,624.3		$ 6,414.6
Operating expenses
Cost of sales (including special charges (a))		1,871.6		1,785.2		3,563.1		3,416.6
Selling, general and administrative expenses		1,115.3		1,093.3		2,205.9		2,181.5
Special (gains) and charges		36.8		26.2		43.0		32.5
Operating income		439.0		412.5		812.3		784.0
Interest expense, net		59.6		65.3		122.1		131.4
Income before income taxes		379.4		347.2		690.2		652.6
Provision for income taxes		81.3		83.6		135.3		157.0
Net income including noncontrolling interest		298.1		263.6		554.9		495.6
Net income attributable to noncontrolling interest		1.5		5.2		4.8		6.4
Net income attributable to Ecolab		$ 296.6		$ 258.4		$ 550.1		$ 489.2

Earnings attributable to Ecolab per common share
Basic		$ 1.02		$ 0.88		$ 1.90		$ 1.67
Diluted		$ 1.01		$ 0.87		$ 1.87		$ 1.64

Dividends declared per common share		$ 0.370		$ 0.350		$ 0.740		$ 0.700

Weighted-average common shares outstanding
Basic		289.8		292.4		290.2		293.4
Diluted		294.1		296.5		294.6		297.5

The accompanying notes are an integral part of the consolidated financial statements.

(a)

Cost of sales includes special charges of $24.4 and $61.9 in the second quarter of 2017 and 2016, respectively, and $25.9 and $61.9 in the first six months of 2017 and 2016, respectively.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

(unaudited)


	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2017		2016		2017		2016

Net income including noncontrolling interest		$ 298.1		$ 263.6		$ 554.9		$ 495.6

Other comprehensive income (loss), net of tax

Foreign currency translation adjustments
Foreign currency translation		44.0		77.8		125.2		(18.5)
Loss on net investment hedges		(55.6)		(12.9)		(52.8)		(27.9)
		(11.6)		64.9		72.4		(46.4)

Derivatives and hedging instruments		0.9		(20.2)		(8.3)		(30.7)

Pension and postretirement benefits
Amortization of net actuarial loss and prior service costs included in
net periodic pension and postretirement costs		3.6		5.5		6.9		11.1
		3.6		5.5		6.9		11.1

Subtotal		(7.1)		50.2		71.0		(66.0)

Total comprehensive income, including noncontrolling interest		291.0		313.8		625.9		429.6
Comprehensive income attributable to noncontrolling interest		2.3		5.2		6.8		9.8
Comprehensive income attributable to Ecolab		$ 288.7		$ 308.6		$ 619.1		$ 419.8

The accompanying notes are an integral part of the consolidated financial statements.

CONSOLIDATED BALANCE SHEET

(unaudited)



	June 30		December 31
(millions, except shares and per share amounts)	2017		2016

ASSETS
Current assets
Cash and cash equivalents		$ 260.7		$ 327.4
Accounts receivable, net		2,446.8		2,341.2
Inventories		1,469.8		1,319.4
Other current assets		354.8		291.4
Total current assets		4,532.1		4,279.4
Property, plant and equipment, net		3,497.4		3,365.0
Goodwill		7,003.8		6,383.0
Other intangible assets, net		4,061.6		3,817.8
Other assets		428.5		485.0
Total assets		$ 19,523.4		$ 18,330.2

LIABILITIES AND EQUITY
Current liabilities
Short-term debt		$ 1,770.6		$ 541.3
Accounts payable		1,123.6		983.2
Compensation and benefits		445.4		516.3
Income taxes		53.0		87.4
Other current liabilities		925.8		891.2
Total current liabilities		4,318.4		3,019.4
Long-term debt		5,909.3		6,145.7
Postretirement health care and pension benefits		1,040.1		1,019.2
Deferred income taxes		1,028.7		970.2
Other liabilities		238.2		204.8
Total liabilities		12,534.7		11,359.3

Equity (a)
Common stock		354.1		352.6
Additional paid-in capital		5,375.5		5,270.8
Retained earnings		7,312.6		6,975.0
Accumulated other comprehensive loss		(1,643.9)		(1,712.9)
Treasury stock		(4,478.6)		(3,984.4)
Total Ecolab shareholders’ equity		6,919.7		6,901.1
Noncontrolling interest		69.0		69.8
Total equity		6,988.7		6,970.9
Total liabilities and equity		$ 19,523.4		$ 18,330.2

(a)

Common stock, 800.0 million shares authorized, $1.00 par value per share, 289.4 million shares outstanding at June 30, 2017 and 291.8 million shares outstanding at December 31, 2016. Shares outstanding are net of treasury stock.

The accompanying notes are an integral part of the consolidated financial statements .

CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited)


	Six Months Ended
	June 30
(millions)	2017		2016

OPERATING ACTIVITIES
Net income including noncontrolling interest		$ 554.9		$ 495.6
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation		286.3		276.0
Amortization		150.9		145.3
Deferred income taxes		(14.1)		(28.8)
Share-based compensation expense		57.5		53.6
Excess tax benefits from share-based payment arrangements		-		(19.6)
Pension and postretirement plan contributions		(37.0)		(192.0)
Pension and postretirement plan expense		17.3		28.6
Restructuring charges, net of cash paid		20.3		(27.1)
Asset charges and write-downs		-		50.9
Other, net		12.6		12.7
Changes in operating assets and liabilities, net of effect of acquisitions:
Accounts receivable		16.0		62.5
Inventories		(95.8)		40.6
Other assets		(9.6)		19.7
Accounts payable		84.0		(79.2)
Other liabilities		(183.6)		36.0
Cash provided by operating activities		859.7		874.8

INVESTING ACTIVITIES
Capital expenditures		(340.2)		(303.7)
Capitalized software expenditures		(38.0)		(22.2)
Property and other assets sold		2.5		11.4
Acquisitions and investments in affiliates, net of cash acquired		(826.5)		(9.4)
Deposit into acquisition related escrow		(1.7)		-
Restricted cash activity		53.8		-
Cash used for investing activities		(1,150.1)		(323.9)

FINANCING ACTIVITIES
Net issuances (repayments) of commercial paper and notes payable		909.8		(342.4)
Long-term debt borrowings		-		793.8
Long-term debt repayments		(5.3)		(130.0)
Reacquired shares		(501.1)		(637.9)
Dividends paid		(222.9)		(217.6)
Exercise of employee stock options		54.6		40.7
Excess tax benefits from share-based payment arrangements		-		19.6
Acquisition related liabilities and contingent consideration		(8.2)		(3.4)
Other, net		(0.9)		-
Cash provided by (used for) financing activities		226.0		(477.2)

Effect of exchange rate changes on cash and cash equivalents		(2.3)		0.9

Increase (decrease) in cash and cash equivalents		(66.7)		74.6
Cash and cash equivalents, beginning of period		327.4		92.8
Cash and cash equivalents, end of period		$ 260.7		$ 167.4

The accompanying notes are an integral part of the consolidated financial statements .

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. CONSOLIDATED FINANCIAL INFORMATION

The unaudited consolidated financial information for the second quarter and six months ended June 30, 2017 and 2016 reflect, in the opinion of company management, all adjustments necessary for a fair presentation of the financial position, results of operations, comprehensive income (loss) and cash flows of Ecolab Inc. ("Ecolab" or "the Company") for the interim periods presented. Any adjustments consist of normal recurring items.

The financial results for any interim period are not necessarily indicative of results for the full year. The consolidated balance sheet data as of December 31, 2016 was derived from the audited consolidated financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited consolidated financial information should be read in conjunction with the consolidated financial statements and notes thereto incorporated in the Company's Annual Report on Form 10-K for the year ended December 31, 2016.

During the first quarter of 2017, the Company adopted the accounting guidance issued in March 2016 that amends certain aspects of share-based compensation for employees, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classifications on the Consolidated Statement of Cash Flows. Under the new guidance, all excess tax benefits or deficiencies are to be recognized prospectively as discrete income tax items on the Consolidated Statement of Income, while previous guidance required realized excess tax benefits or deficiencies to be recognized in additional paid-in capital. The Company recorded $10.8 million and $26.8 million of excess tax benefits during the second quarter and first six months of 2017, respectively. The extent of excess tax benefits is subject to variation in stock price and stock option exercises. Adoption of the accounting standard also eliminated the requirement that excess tax benefits be realized before they can be recognized, and as a result, the Company recorded a $1.9 million cumulative-effect adjustment for previously unrecognized excess tax benefits.

The Company’s adoption also resulted in associated excess tax benefits being classified as an operating activity in the statement of cash flows prospectively beginning January 1, 2017 with no changes to the prior year. Based on the adoption methodology applied, employee taxes paid remain classified as a financing activity on the statement of cash flows, and the statement of cash flows classification of prior periods has not changed. With regards to forfeitures, the new guidance allows companies either to continue to estimate the number of awards that will be forfeited or to account for forfeitures as they occur. The Company has elected to continue to estimate the number of awards that will be forfeited based on an estimate of the number of outstanding awards expected to vest.

With respect to the unaudited financial information of the Company for the second quarter and six months ended June 30, 2017 and 2016 included in this Form 10-Q, PricewaterhouseCoopers LLP reported that they have applied limited procedures in accordance with professional standards for a review of such information. Their separate report dated August 3, 2017 appearing herein states that they did not audit and they do not express an opinion on that unaudited financial information. Accordingly, the degree of reliance on their report on such information should be restricted in light of the limited nature of the review procedures applied. PricewaterhouseCoopers LLP is not subject to the liability provisions of Section 11 of the Securities Act of 1933, as amended (the "Act"), for their report on the unaudited financial information because that report is not a "report" or a "part" of a registration statement prepared or certified by PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11 of the Act.

2. SPECIAL (GAINS) AND CHARGES

Special (gains) and charges reported on the Consolidated Statement of Income include the following:



	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2017		2016		2017		2016
Cost of sales
Restructuring activities		2.2		0.9		2.2		0.9
Acquisition and integration costs		11.1		-		12.6		-
Energy related charges		-		51.0		-		51.0
Other		11.1		10.0		11.1		10.0
Subtotal		24.4		61.9		25.9		61.9

Special (gains) and charges
Restructuring activities		30.8		(2.1)		30.5		0.9
Acquisition and integration costs		4.6		1.0		10.9		3.3
Energy related charges		-		12.6		-		12.6
Venezuela related gain		(5.3)		(7.8)		(5.3)		(7.8)
Other		6.7		22.5		6.9		23.5
Subtotal		36.8		26.2		43.0		32.5

Total special (gains) and charges		$ 61.2		$ 88.1		$ 68.9		$ 94.4

For segment reporting purposes, special (gains) and charges are not allocated to reportable segments, which is consistent with the Company’s internal management reporting.

Restructuring activities

The Company’s restructuring activities are associated with plans to enhance its efficiency and effectiveness and sharpen its competitiveness. Restructuring plans include net costs associated with significant actions involving employee-related severance charges, contract termination costs and asset write-downs and disposals. Employee termination costs are largely based on policies and severance plans, and include personnel reductions and related costs for severance, benefits and outplacement services. These charges are reflected in the quarter when the actions are probable and the amounts are estimable, which typically is when management approves the actions. Contract termination costs include charges to terminate leases prior to the end of their respective terms and other contract terminations. Asset write-downs and disposals include leasehold improvement write-downs, other asset write-downs associated with combining operations and disposal of assets. Restructuring activities have been included as a component of both cost of sales and special (gains) and charges on the Consolidated Statement of Income. Restructuring liabilities have been classified as a component of both other current and other noncurrent liabilities on the Consolidated Balance Sheet.

During the second quarter of 2017, the Company commenced restructuring and other cost-saving actions in order to streamline its operations. These actions include a reduction of the Company’s global workforce by approximately 530 positions, as well as asset disposals and lease terminations. As a result of these actions, the Company expects to incur $40 to $45 million ($30 to $35 million after tax) of restructuring charges. During the second quarter of 2017, the Company recorded restructuring charges of $33.0 million ($25.0 million after tax) related primarily to employee termination costs. The remaining charges are expected to be recognized during the second half of 2017. As of June 30, 2017, the restructuring liability balance related to these actions was $28.4 million. The Company anticipates that the majority of the pretax charges will represent net cash expenditures which are expected to be paid over a period of a few months to several quarters and will be funded from operating activities. Cash payments during the second quarter of 2017 were minimal.

Net restructuring gains and charges related to the Company’s Energy and Combined restructuring plans during 2017 were minimal. During the second quarter and first six months of 2016, net restructuring activities included net restructuring gains of $1.2 million ($1.9 million after tax) and net restructuring charges of $1.8 million ($0.1 million gain after tax), respectively. The restructuring liability balance was $28.4 million and $39.6 million as of June 30, 2017 and December 31, 2016, respectively. The reduction in liability was driven primarily by severance and other cash payments. The remaining accrual is expected to be paid over a period of a few months to several quarters and continues to be funded from operating activities.

Acquisition and integration related costs

Acquisition and integration costs reported in cost of sales on the Consolidated Statement of Income include $11.1 million ($7.0 million after tax) and $12.6 million ($8.0 million after tax) during the second quarter and first six months of 2017, respectively, related primarily to recognition of accelerated rent expense upon the closure of Swisher Hygiene Inc. (“Swisher”) plants and disposal of excess inventory. The second quarter and first six months of 2017 also include amounts related to recognition of fair value step-up in the Laboratoires Anios (“Anios”) inventory.

Acquisition and integration costs reported in special (gains) and charges on the Consolidated Statement of Income include $4.6 million ($3.0 million after tax) and $10.9 million ($7.3 million after tax) of acquisition costs, advisory and legal fees, and integration charges for the Anios and Swisher acquisitions during the second quarter and first six months of 2017, respectively.

During the second quarter and first six months of 2016, the Company incurred acquisition and integration charges of $1.0 million ($0.7 million after tax) and $3.3 million ($2.1 million after tax), respectively. Further information related to the Company’s acquisitions is included in Note 3.

Energy related charges

Oil industry activity remained depressed during 2016 when compared with 2014 levels, resulting from continued excess oil supply pressures, which have negatively impacted exploration and production investments in the energy industry, particularly in North America. As a result of the conditions in place during 2016, and their corresponding impact on the Company’s business outlook, the Company recorded total charges of $63.6 million ($42.9 million after tax) during the second quarter and first six months of 2016, comprised of inventory write downs and related disposal costs, fixed asset charges, headcount reductions and other charges. No such charges were incurred in 2017.

The inventory write-downs and related disposal costs of $31.1 million include adjustments due to the significant decline in activity and related prices of certain specific-use and other products, coupled with declines in replacement costs, as well as estimated costs to dispose the respective excess inventory. The fixed asset charges of $18.2 million resulted from the write-down of certain assets related to the reduction in certain aspects of our North American Global Energy segment, as well as abandonment of certain projects under construction. The carrying value of the corresponding fixed assets was reduced to zero. The employee termination costs of $12.8 million include a reduction in the Global Energy segment’s global workforce to better align its workforce with anticipated activity levels in the near term. As of the end of the second quarter of 2017, the Company had $4.3 million of corresponding severance remaining to be paid, which is expected to be paid in the next several months and be funded from operating activities.

The charges discussed above have been included as a component of both cost of sales and special (gains) and charges on the Consolidated Statement of Income.

Venezuela related gain

Effective as of the end of the fourth quarter of 2015, the Company deconsolidated its Venezuelan subsidiaries. During the second quarter of 2017 and 2016, the Company recorded gains of $5.3 million ($3.3 million after tax) and $7.8 million ($4.9 million after tax), respectively, resulting from U.S. dollar cash recoveries of intercompany receivables written off at the time of deconsolidation.

Other

During the second quarter and first six months of 2017, the Company recorded charges of $17.8 million ($14.4 million after tax) and $18.0 million ($14.5 million after tax), respectively, related to a Global Energy vendor contract termination and litigation related charges. These charges have been included as a component of both cost of sales and special (gains) and charges on the Consolidated Statement of Income.

During the second quarter and first six months of 2016, the Company recorded a charge of $10.0 million ($6.3 million after tax) related to a fixed asset impairment and related inventory charges. The fixed asset impairment corresponds to additional charges of certain U.S. production equipment and buildings, resulting from further lower production, initially impaired during the fourth quarter of 2015. This charge has been included as a component of cost of sales on the Consolidated Statement of Income.

Additionally, during the second quarter and first six months of 2016, the Company recorded charges of $22.5 million ($13.9 million after tax) and $23.5 million ($15.1 million after tax), respectively, primarily consisting of litigation related charges. These charges have been included as a component of special (gains) and charges on the Consolidated Statement of Income.

3. ACQUISITIONS AND DISPOSITIONS

Acquisitions

The Company makes acquisitions that align with its strategic business objectives. The assets and liabilities of the acquired entities have been recorded as of the acquisition date, at their respective fair values, and are included in the Consolidated Balance Sheet and results of the Company from the date of acquisition. The purchase price allocation is based on estimates of the fair value of assets acquired and liabilities assumed. The aggregate purchase price of acquisitions has been reduced for any cash or cash equivalents acquired with the acquisition. Acquisitions during the first six months of 2017 and 2016 were not material to the Company’s consolidated financial statements; therefore, pro forma financial information is not presented.

Anios Acquisition

On February 1, 2017, the Company acquired Anios for total consideration of $798.3 million in cash, including satisfaction of outstanding debt. Anios is a leading European manufacturer and marketer of hygiene and disinfection products for the healthcare, food service, and food and beverage processing industries. Anios provides an innovative product line that expands the solutions the Company is able to offer while also providing a complementary geographic footprint within the healthcare market. With pre-acquisition annual sales of

approximately $245 million, the acquired business became part of the Company’s Global Institutional reportable segment during the first quarter of 2017. During 2016, the Company deposited €50 million in an escrow account that was released back to the Company upon closing of the transaction in February 2017. As shown within Note 4, this was recorded as restricted cash within other assets on the Consolidated Balance Sheet as of December 31, 2016.

The Company incurred certain acquisition and integration costs associated with the transaction that were expensed and are reflected in the Consolidated Statement of Income. A total of $3.4 million ($2.3 million after tax) of charges were incurred during the second quarter of 2017, of which $1.6 million ($1.0 million after tax) were included in cost of sales and are related to recognition of fair value step-up in Anios inventory. A total of $9.4 million ($6.5 million after tax) of charges were incurred during the first six months of 2017, of which $3.1 million ($2.1 million after tax) were included in cost of sales and are related to recognition of fair value step-up in Anios inventory.

The Anios acquisition has been accounted for using the acquisition method of accounting, which requires, among other things, that most assets acquired and liabilities assumed be recognized at fair value as of the acquisition date. Certain estimated values are not yet finalized and are subject to change. Amounts for certain deferred tax assets and liabilities, environmental reserves, certain tangible and intangible assets, income tax uncertainties, and goodwill remain subject to change, as information necessary to complete the analysis is obtained. The Company expects to finalize these by the filing of the 2017 Form 10-K.

The following table summarizes the preliminary value of Anios assets acquired and liabilities assumed as of the acquisition date.



(millions)
Tangible assets			$ 142.7
Identifiable intangible assets:
Customer relationships			252.0
Trademarks			65.7
Other technology			16.1
Total assets acquired			476.5

Total liabilities assumed			196.3

Goodwill			518.1
Total consideration transferred			798.3

Long-term debt repaid upon close			192.8
Net consideration transferred to sellers			$ 605.5

Net tangible assets are primarily comprised of accounts receivable of $66.2 million, property, plant and equipment of $25.6 million and inventory of $29.7 million.

Customer relationships, trademarks, and other technology are being amortized over weighted average lives of 20, 17, and 11 years, respectively.

Goodwill of $518.1 million arising from the acquisition consists largely of the synergies and economies of scale expected through adding complementary geographies and innovative products to the Company’s healthcare portfolio. The goodwill was assigned to the Healthcare operating segment within the Global Institutional reportable segment. None of the goodwill recognized is expected to be deductible for income tax purposes.

Other Acquisitions

Excluding the Anios acquisition, during the first six months of 2017, the Company paid $27.9 million for acquisitions, of which $18.4 million was attributed to certain identifiable intangible assets. The weighted average useful life of these identifiable intangible assets acquired was 12 years. Additionally, there were immaterial purchase price adjustments related to prior year acquisitions.

During the first six months of 2016, the Company paid $12.8 million for acquisitions, of which $2.5 million was attributed to certain identifiable intangible assets. The weighted average useful life of these identifiable intangible assets acquired was 5 years. Additionally, there were immaterial purchase price adjustments related to prior year acquisitions.

Dispositions

There were no business dispositions during the first six months of 2017 or 2016.

4. BALANCE SHEET INFORMATION




	June 30		December 31
(millions)	2017		2016
Accounts receivable, net
Accounts receivable		$ 2,517.2		$ 2,408.8
Allowance for doubtful accounts		(70.4)		(67.6)
Total		$ 2,446.8		$ 2,341.2

Inventories
Finished goods		$ 986.5		$ 860.0
Raw materials and parts		447.6		408.4
Inventories at FIFO cost		1,434.1		1,268.4
FIFO cost to LIFO cost difference		35.7		51.0
Total		$ 1,469.8		$ 1,319.4

Other current assets
Prepaid assets		$ 132.6		$ 98.3
Taxes receivable		131.6		105.0
Derivative assets		44.2		46.3
Other		46.4		41.8
Total		$ 354.8		$ 291.4

Property, plant and equipment, net
Land		$ 216.6		$ 211.0
Buildings and leasehold improvements		1,122.6		1,121.2
Machinery and equipment		2,159.0		2,035.8
Merchandising and customer equipment		2,327.3		2,199.4
Capitalized software		570.1		531.1
Construction in progress		390.9		344.1
		6,786.5		6,442.6
Accumulated depreciation		(3,289.1)		(3,077.6)
Total		$ 3,497.4		$ 3,365.0

Other intangible assets, net
Intangible assets not subject to amortization
Trade names		$ 1,230.0		$ 1,230.0
Intangible assets subject to amortization
Customer relationships		$ 3,519.5		$ 3,206.1
Trademarks		374.2		303.3
Patents		454.9		446.5
Other technology		228.0		210.5
		4,576.6		4,166.4
Accumulated amortization
Customer relationships		(1,275.6)		(1,148.2)
Trademarks		(137.6)		(125.2)
Patents		(171.6)		(157.3)
Other technology		(160.2)		(147.9)
		(1,745.0)		(1,578.6)
Net intangible assets subject to amortization		2,831.6		2,587.8
Total		$ 4,061.6		$ 3,817.8

Other assets
Deferred income taxes		$ 102.0		$ 92.3
Pension		32.9		27.2
Derivative assets		1.3		21.5
Restricted cash		-		53.0
Other		292.3		291.0
Total		$ 428.5		$ 485.0



	June 30		December 31
(millions)	2017		2016
Other current liabilities
Discounts and rebates		$ 309.6		$ 275.2
Dividends payable		107.2		108.0
Interest payable		48.2		37.3
Taxes payable, other than income		108.1		103.7
Derivative liabilities		36.6		24.6
Restructuring		51.7		30.5
Other		264.4		311.9
Total		$ 925.8		$ 891.2

Accumulated other comprehensive loss
Unrealized loss on derivative financial instruments, net of tax		$ (16.8)		$ (8.5)
Unrecognized pension and postretirement benefit expense, net of tax		(518.4)		(511.4)
Cumulative translation, net of tax		(1,108.7)		(1,193.0)
Total		$ (1,643.9)		$ (1,712.9)

5. DEBT AND INTEREST

Short-term Debt

The following table provides the components of the Company’s short-term debt obligations as of June 30, 2017 and December 31, 2016.





	June 30		December 31
(millions)	2017		2016
Short-term debt
Commercial paper		$ 918.0		$ -
Notes payable		41.8		29.9
Long-term debt, current maturities		810.8		511.4
Total		$ 1,770.6		$ 541.3

Line of Credit

As of June 30, 2017, the Company had in place a $2.0 billion multi-year credit facility which expires in December 2019. The credit facility has been established with a diverse syndicate of banks and supports the Company’s U.S. and Euro commercial paper programs. There were no borrowings under the Company’s credit facility as of either June 30, 2017 or December 31, 2016.

Commercial Paper

The Company’s commercial paper program is used as a potential source of liquidity and consists of a $2.0 billion U.S. commercial paper program and a $2.0 billion Euro commercial paper program. The maximum aggregate amount of commercial paper that may be issued by the Company under its commercial paper programs may not exceed $2.0 billion.

As of June 30, 2017, the Company had $581.0 million and $337.0 million (€300 million) of commercial paper outstanding under its U.S. and Euro programs, respectively. As of December 31, 2016, the Company had no commercial paper outstanding under either program.

Long-term Debt

The following table provides the components of the Company’s long-term debt obligations, including current maturities, as of June 30, 2017 and December 31, 2016.




	Maturity	June 30		December 31
(millions)	by Year	2017		2016
Long-term debt
Public notes (2017 principal amount)
Five year 2012 senior notes ($500 million)	2017		$ 499.1		$ 498.9
Three year 2015 senior notes ($300 million)	2018		299.1		298.9
Three year 2016 senior notes ($400 million)	2019		396.4		395.9
Five year 2015 senior notes ($300 million)	2020		298.8		298.6
Ten year 2011 senior notes ($1.25 billion)	2021		1,245.3		1,244.8
Seven year 2016 senior notes ($400 million)	2023		397.3		397.0
Seven year 2016 senior notes (€575 million)	2024		637.6		608.4
Ten year 2015 senior notes (€575 million)	2025		640.7		604.3
Ten year 2016 senior notes ($750 million)	2026		742.5		742.1
Thirty year 2011 senior notes ($750 million)	2041		739.0		738.7
Thirty year 2016 senior notes ($250 million)	2046		245.9		245.9
Private notes (2017 principal amount)
Series A private placement senior notes ($250 million)	2018		248.9		248.9
Series B private placement senior notes ($250 million)	2023		249.3		249.2
Capital lease obligations			5.1		5.2
Other			75.1		80.3
Total debt			6,720.1		6,657.1
Long-term debt, current maturities			(810.8)		(511.4)
Total long-term debt			$ 5,909.3		$ 6,145.7

Public Notes

The Company’s public notes may be redeemed by the Company at its option at redemption prices that include accrued and unpaid interest and a make-whole premium. Upon the occurrence of a change of control accompanied by a downgrade of the public notes below investment grade rating, within a specified time period, the Company would be required to offer to repurchase the public notes at a price equal to 101% of the aggregate principal amount thereof, plus any accrued and unpaid interest to the date of repurchase. The public notes are senior unsecured and unsubordinated obligations of the Company and rank equally with all other senior and unsubordinated indebtedness of the Company.

Private Notes

The Company’s private notes may be redeemed by the Company at its option at redemption prices that include accrued and unpaid interest and a make-whole premium. Upon the occurrence of specified changes of control involving the Company, the Company would be required to offer to repurchase the private notes at a price equal to 100% of the aggregate principal amount thereof, plus any accrued and unpaid interest to the date of repurchase. Additionally, the Company would be required to make a similar offer to repurchase the private notes upon the occurrence of specified merger events or asset sales involving the Company, when accompanied by a downgrade of the private notes below investment grade rating, within a specified time period. The private notes are unsecured senior obligations of the Company and rank equal in right of payment with all other senior indebtedness of the Company. The private notes shall be unconditionally guaranteed by subsidiaries of the Company in certain circumstances, as described in the note purchase agreement as amended.

Covenants

The Company is in compliance with its debt covenants as of June 30, 2017.

Net Interest Expense

Interest expense and interest income recognized during the second quarter and the first six months of 2017 and 2016 were as follows:


	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2017		2016		2017		2016
Interest expense		$ 63.7		$ 71.5		$ 130.3		$ 140.4
Interest income		(4.1)		(6.2)		(8.2)		(9.0)
Interest expense, net		$ 59.6		$ 65.3		$ 122.1		$ 131.4

6. GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in a business combination. The Company’s reporting units are its operating segments.

During the second quarter of 2017, the Company completed its annual assessment for goodwill impairment across its eleven reporting units through a quantitative analysis, utilizing a discounted cash flow approach, which incorporates assumptions regarding future growth rates, terminal values, and discount rates. The two-step quantitative process involved comparing the estimated fair value of each reporting unit to the reporting unit’s carrying value, including goodwill. If the fair value of a reporting unit exceeds its carrying value, goodwill of the reporting unit is considered not to be impaired, and the second step of the impairment test is unnecessary. If the carrying amount of the reporting unit exceeds its fair value, the second step of the goodwill impairment test would be performed to measure the amount of impairment loss to be recorded, if any. The Company’s goodwill impairment assessment for 2017 indicated the estimated fair value of each of its reporting units exceeded its carrying amount by a significant margin.

If circumstances change significantly, the Company would also test a reporting unit’s goodwill for impairment during interim periods between its annual tests. There has been no impairment of goodwill in any of the years presented.

The changes in the carrying amount of goodwill for each of the Company's reportable segments during the six months ended June 30, 2017 were as follows:


	Global		Global		Global
(millions)	Industrial		Institutional		Energy		Other		Total
December 31, 2016		$ 2,522.3		$ 653.4		$ 3,093.6		$ 113.7		$ 6,383.0
Reclassifications (a)		62.7		(62.7)		-		-		-
December 31, 2016 revised		$ 2,585.0		$ 590.7		$ 3,093.6		$ 113.7		$ 6,383.0
Current year business combinations (b)		4.1		518.1		-		-		522.2
Prior year business combinations (c)		-		-		0.3		-		0.3
Effect of foreign currency translation		36.9		15.8		44.0		1.6		98.3
June 30, 2017		$ 2,626.0		$ 1,124.6		$ 3,137.9		$ 115.3		$ 7,003.8

(a)

Relates to establishment of the Life Sciences reporting unit, and goodwill being allocated to Life Sciences based on fair value allocation of goodwill. The Life Sciences reporting unit is included in the Industrial reportable segment and is comprised of operations previously recorded in the Food & Beverage and Healthcare reporting units, which are aggregated and reported in the Global Industrial and Global Institutional reportable segments, respectively. See Note 14 for further information.

(b)

Represents goodwill associated with current year acquisitions. Of the goodwill acquired, the Company expects $4.1 million of the goodwill related to businesses acquired to be tax deductible.

(c)

Represents purchase price allocation adjustments for 2016 acquisitions deemed preliminary as of December 31, 2016.

Other Intangible Assets

The Nalco trade name is the Company’s principal indefinite life intangible asset. During the second quarter of 2017, the Company completed its annual test for indefinite life intangible asset impairment using a relief from royalty method of assessment, which incorporates assumptions regarding future sales projections and discount rates. Based on this testing, the estimated fair value of the asset exceeded its carrying value by a significant margin; therefore, no adjustment to the $1.2 billion carrying value of this asset was necessary. There has been no impairment of the Nalco trade name intangible asset since it was acquired.

The Company’s intangible assets subject to amortization primarily include customer relationships, trademarks, patents and other technology. The fair value of identifiable intangible assets is estimated based upon discounted future cash flow projections and other acceptable valuation methods. Other intangible assets are amortized on a straight-line basis over their estimated economic lives. Total amortization expense related to other intangible assets during the second quarter of 2017 and 2016 was $77.1 million and $72.7 million, respectively. Total amortization expense related to other intangible assets during the first six months of 2017 and 2016 was $150.9 million and $145.3 million, respectively. Estimated amortization for the remaining six month period of 2017 related to other amortizable intangible assets is expected to be approximately $157 million.

7. FAIR VALUE MEASUREMENTS

The Company’s financial instruments include cash and cash equivalents, restricted cash, accounts receivable, accounts payable, commercial paper, notes payable, foreign currency forward contracts, interest rate swap agreements and long-term debt.

Fair value is defined as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. A hierarchy has been established for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs be used when available. The hierarchy is broken down into three levels:

Level 1 - Inputs are quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2 - Inputs include observable inputs other than quoted prices in active markets.

Level 3 - Inputs are unobservable inputs for which there is little or no market data available.

The carrying amount and the estimated fair value for assets and liabilities measured on a recurring basis were:


	June 30, 2017
(millions)	Carrying		Fair Value Measurements
	Amount		Level 1		Level 2		Level 3
Assets
Foreign currency forward contracts		$ 68.8		$ -		$ 68.8		$ -
Liabilities
Foreign currency forward contracts		83.3		-		83.3		-
Interest rate swap agreements		3.9		-		3.9		-


	December 31, 2016
(millions)	Carrying		Fair Value Measurements
	Amount		Level 1		Level 2		Level 3
Assets
Foreign currency forward contracts		$ 93.4		$ -		$ 93.4		$ -

Liabilities
Foreign currency forward contracts		46.7		-		46.7		-
Interest rate swap agreements		3.5		-		3.5		-

The carrying value of foreign currency forward contracts is at fair value, which is determined based on foreign currency exchange rates as of the balance sheet date, and is classified within Level 2. The carrying value of interest rate swap contracts is at fair value, which is determined based on current interest rates and forward interest rates as of the balance sheet date and is classified within Level 2. For purposes of fair value disclosure above, derivative values are presented gross. See further discussion of gross versus net presentation of the Company's derivatives within Note 8.

The carrying values of accounts receivable, accounts payable, cash and cash equivalents, restricted cash, commercial paper and notes payable approximate fair value because of their short maturities, and as such are classified within Level 1.

The fair value of long-term debt is based on quoted market prices for the same or similar debt instruments classified as Level 2. The carrying amount and the estimated fair value of long-term debt, including current maturities, held by the Company were:

June 30

December 31

(millions)

2017

2016

Carrying

Fair

Carrying

Fair

Amount

Value

Amount

Value

Long-term debt, including current maturities

$ 6,720.1

$ 7,115.9

$ 6,657.1

$ 6,963.9

8. DERIVATIVES AND HEDGING TRANSACTIONS

The Company uses foreign currency forward contracts, interest rate swap agreements and foreign currency debt to manage risks associated with foreign currency exchange rates, interest rates and net investments in foreign operations. The Company does not hold derivative financial instruments of a speculative nature or for trading purposes. The Company records derivatives as assets and liabilities on the balance sheet at fair value. Changes in fair value are recognized immediately in earnings unless the derivative qualifies and is designated as a hedge. Cash flows from derivatives are classified in the statement of cash flows in the same category as the cash flows from the items subject to designated hedge or undesignated (economic) hedge relationships. The Company evaluates hedge effectiveness at inception and on an ongoing basis. If a derivative is no longer expected to be effective, hedge accounting is discontinued. Hedge ineffectiveness, if any, is recorded in earnings.

The Company is exposed to credit risk in the event of nonperformance of counterparties for foreign currency forward exchange contracts and interest rate swap agreements. The Company monitors its exposure to credit risk by using credit approvals and credit limits and by selecting major global banks and financial institutions as counterparties. The Company does not anticipate nonperformance by any of these counterparties, and therefore, recording a valuation allowance against the Company’s derivative balance is not considered necessary.

Derivative Positions Summary

Certain of the Company’s derivative transactions are subject to master netting arrangements that allow the Company to net settle contracts with the same counterparties. These arrangements generally do not call for collateral and as of the applicable dates presented in the following table no cash collateral had been received or pledged related to the underlying derivatives.

The respective net amounts are included in other current assets, other non-current assets, other current liabilities and other liabilities on the Consolidated Balance Sheet.

The following table summarizes the gross fair value and the net value of the Company’s outstanding derivatives.



	Asset Derivatives				Liability Derivatives
	June 30		December 31		June 30		December 31
(millions)	2017		2016		2017		2016
Derivatives designated as hedging instruments
Foreign currency forward contracts		$ 21.8		$ 73.4		$ 16.8		$ 19.8
Interest rate swap agreements		-		-		3.9		3.5

Derivatives not designated as hedging instruments
Foreign currency forward contracts		47.0		20.0		66.5		26.9
Gross value of derivatives		68.8		93.4		87.2		50.2

Gross amounts offset in the Consolidated Balance Sheet		(23.3)		(25.7)		(23.3)		(25.7)
Net value of derivatives		$ 45.5		$ 67.7		$ 63.9		$ 24.5

The following table summarizes the notional values of the Company’s outstanding derivatives.


	Notional Values
	June 30		December 31
(millions)	2017		2016

Foreign currency forward contracts (a)		$ 5,288		$ 4,317
Interest rate agreements		$ 1,450		$ 1,450

(a)

Includes net investment hedge forward contracts of €40 million and €0 million as of June 30, 2017 and December 31, 2016, respectively.

Cash Flow Hedges

The Company utilizes foreign currency forward contracts to hedge the effect of foreign currency exchange rate fluctuations on forecasted foreign currency transactions, including inventory purchases and intercompany royalty, management fee and other payments. These forward contracts are designated as cash flow hedges. The effective portions of the changes in fair value of these contracts are recorded in accumulated other comprehensive income (“AOCI”) until the hedged items affect earnings, at which time the gain or loss is reclassified into the same line item in the Consolidated Statement of Income as the underlying exposure being hedged. Cash flow hedged transactions impacting AOCI are forecasted to occur within the next two years.

The Company occasionally enters into treasury lock and forward starting interest rate swap agreements to manage interest rate exposure. During 2016, 2015, and 2014 the Company entered into and subsequently closed a series of treasury lock and forward starting interest rate swap agreements, in conjunction with its public debt issuances. The agreements were designated and effective as cash flow

hedges of the expected interest payments related to the anticipated future debt issuances. Amounts recorded in AOCI are recognized as part of interest expense over the remaining life of the notes as the forecasted interest transactions occur.

The effective portion of gains and losses recognized into AOCI and earnings from derivative contracts that qualified as cash flow hedges was as follows:


		Second Quarter Ended				Six Months Ended
		June 30				June 30
(millions)		2017		2016		2017		2016
Unrealized gain (loss) recognized into AOCI
Foreign currency forward contracts	AOCI (equity)		$ (28.9)		$ (23.8)		$ (44.3)		$ (27.5)
Interest rate swap agreements	AOCI (equity)		-		(4.6)		-		(12.9)
	Total		(28.9)		(28.4)		(44.3)		(40.4)

Gain (loss) recognized in income
Foreign currency forward contracts	Cost of sales		(8.3)		8.9		(10.8)		21.6
	SG&A		(23.3)		(9.0)		(22.7)		(19.6)
	Interest expense, net		1.5		1.4		2.9		2.9
	Subtotal		(30.1)		1.3		(30.6)		4.9

Interest rate swap agreements	Interest expense, net		(1.8)		(1.6)		(3.6)		(3.2)
	Total		$ (31.9)		$ (0.3)		$ (34.2)		$ 1.7

Gains and losses recognized in income related to the ineffective portion of the Company’s cash flow hedges were insignificant during the first six months of 2017 and 2016.

Fair Value Hedges

The Company manages interest expense using a mix of fixed and floating rate debt. To help manage exposure to interest rate movements and to reduce borrowing costs, the Company may enter into interest rate swaps under which the Company agrees to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed upon notional principal amount. The mark-to-market of these fair value hedges is recorded as gains or losses in interest expense and is offset by the gain or loss of the underlying debt instrument, which also is recorded in interest expense. These fair value hedges are highly effective and thus, there is no impact on earnings due to hedge ineffectiveness.

In January 2016, the Company entered into an interest rate swap agreement that converted its $400 million 2.00% debt from a fixed interest rate to a floating interest rate. In January 2015, the Company entered into interest rate swap agreements that converted its $300 million 1.55% debt and its $250 million 3.69% debt from fixed interest rates to floating interest rates. In May 2014, the Company entered into an interest rate swap agreement that converted its $500 million 1.45% debt from a fixed rate to a floating interest rate.

The interest rate swaps referenced above were designated as fair value hedges.

The impact on earnings from derivative contracts that qualified as fair value hedges was as follows:


		Second Quarter Ended				Six Months Ended
		June 30				June 30
(millions)		2017		2016		2017		2016

Gain (loss) on derivative recognized income
Interest rate swap	Interest expense, net		$ 1.3		$ 3.0		$ (0.4)		$ 13.7

Gain (loss) on hedged item recognized income
Interest rate swap	Interest expense, net		$ (1.3)		$ (3.0)		$ 0.4		$ (13.7)

Net Investment Hedges

The Company designates its outstanding €1,150 million ($1,292 million at the end of the second quarter of 2017) senior notes (“euronotes”) and €200 million ($225 million at the end of the second quarter of 2017) Euro commercial paper and related accrued interest as hedges of existing foreign currency exposures related to investments the Company has in certain euro denominated functional currency subsidiaries.

The revaluation gains and losses on the euronotes and Euro commercial paper, which are designated and effective as hedges of the Company’s net investments, have been included as a component of the cumulative translation adjustment account and were as follows:


	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2017		2016		2017		2016
Revaluation gains (losses), net of tax		$ (55.6)		$ (12.9)		$ (52.8)		$ (27.9)

Derivatives Not Designated as Hedging Instruments

The Company also uses foreign currency forward contracts to offset its exposure to the change in value of certain foreign currency denominated assets and liabilities held at foreign subsidiaries, primarily receivables and payables, which are remeasured at the end of each period. Although the contracts are effective economic hedges, they are not designated as accounting hedges. Therefore, changes in the value of these derivatives are recognized immediately in earnings, thereby offsetting the current earnings effect of the related foreign currency denominated assets and liabilities.

The impact on earnings from derivative contracts that are not designated as hedging instruments was as follows:


		Second Quarter Ended				Six Months Ended
		June 30				June 30
(millions)		2017		2016		2017		2016
Gain (loss) recognized in income
Foreign currency forward contracts	SG&A		$ (50.8)		$ 17.3		$ (43.8)		$ (15.3)
	Interest expense, net		2.4		(2.6)		2.5		(3.1)
	Total		$ (48.4)		$ 14.7		$ (41.3)		$ (18.4)

The amounts recognized in SG&A above offset the earnings impact of the related foreign currency denominated assets and liabilities. The amounts recognized in interest expense above represent the component of the hedging gains (losses) attributable to the difference between the spot and forward rates of the hedges as a result of interest rate differentials. The losses recognized in 2017 primarily relate to movements in the Euro rates.

9. OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION

Other comprehensive income (loss) includes net income, foreign currency translation adjustments, unrecognized gains and losses on securities, defined benefit pension and postretirement plan adjustments, gains and losses on derivative instruments designated and effective as cash flow hedges and non-derivative instruments designated and effective as foreign currency net investment hedges that are charged or credited to the accumulated other comprehensive loss account in shareholders’ equity.

The following tables provide other comprehensive income information related to the Company’s derivatives and hedging instruments and pension and postretirement benefits. See Note 8 for additional information related to the Company’s derivatives and hedging transactions. See Note 13 for additional information related to the Company’s pension and postretirement benefits activity.


	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2017		2016		2017		2016
Derivative and Hedging Instruments
Unrealized gains (losses) on derivative & hedging instruments
Amount recognized in AOCI		$ (28.9)		$ (28.4)		$ (44.3)		$ (40.4)
(Gains) losses reclassified from AOCI into income
Cost of sales		8.3		(8.9)		10.8		(21.6)
SG&A		23.3		9.0		22.7		19.6
Interest expense, net		0.3		0.2		0.7		0.3
		31.9		0.3		34.2		(1.7)
Other activity		0.4		(0.8)		0.5		-
Tax impact		(2.5)		8.7		1.3		11.4
Net of tax		$ 0.9		$ (20.2)		$ (8.3)		$ (30.7)

Pension and Postretirement Benefits
Amount reclassified from AOCI into income
Actuarial losses		11.0		10.9		22.0		21.8
Prior service costs		(5.9)		(2.0)		(12.0)		(4.0)
		5.1		8.9		10.0		17.8
Tax impact		(1.5)		(3.4)		(3.1)		(6.7)
Net of tax		$ 3.6		$ 5.5		$ 6.9		$ 11.1

The following table summarizes the derivative and pension and postretirement benefit amounts reclassified from AOCI into income.


	Second Quarter Ended				Six Months Ended
	June 30				June 30
	2017		2016		2017		2016
(millions)
Derivative losses (gains) reclassified from AOCI into income, net of tax		$ 24.5		$ (0.1)		$ 25.5	$	(1.4)

Pension and postretirement benefits net actuarial losses
and prior services costs reclassified from AOCI into income, net of tax		$ 3.6		$ 5.5		$ 6.9	$	11.1

10. SHAREHOLDERS’ EQUITY

Share Repurchase Authorization

In February 2015, the Company’s Board of Directors authorized the repurchase of up to 20 million shares of its common stock, including shares to be repurchased under Rule 10b5–1. As of June 30, 2017, 13,000,171 shares remained to be repurchased under the Company’s repurchase authorization. The Company intends to repurchase all shares under its authorization, for which no expiration date has been established, in open market or privately negotiated transactions, subject to market conditions.

Accelerated Stock Repurchase (“ASR”) Agreements

In February 2017, the Company entered into an ASR agreement to repurchase $300 million of its common stock and received 2,077,224 shares of its common stock, which was approximately 85% of the total number of shares the Company expected to be repurchased under the ASR, based on the price of the Company’s common stock at that time. In connection with the final settlement of the ASR agreement in June 2017, the Company received an additional 286,620 shares of common stock.

In February 2016, the Company entered into an ASR agreement to repurchase $300 million of its common stock and received 2,459,490 shares of its common stock, which was approximately 85% of the total number of shares the Company expected to be repurchased under the ASR, based on the price of the Company’s common stock at that time. Upon final settlement of the ASR agreement in May 2016, the Company received an additional 232,012 shares of common stock.

The final per share purchase price and the total number of shares to be repurchased under both 2017 and 2016 ASR agreements generally were based on the volume-weighted average price of the Company’s common stock during the term of the agreements.

All shares acquired under the ASR agreements were recorded as treasury stock.

During their respective open periods in 2017 and 2016, neither of the ASRs was dilutive to the Company’s earnings per share calculations, nor did they trigger the two-class earnings per share methodology. Additionally, the unsettled portion of ASRs during their respective open periods met the criteria to be accounted for as a forward contract indexed to the Company’s stock and qualified as equity transactions.

The initial delivery of shares, as well as the additional receipt of shares at settlement resulted in a reduction to the Company’s common stock outstanding used to calculate earnings per share, the impact of which was not material.

Share Repurchases

During the first six months of 2017, the Company reacquired 3,957,832 shares of its common stock, of which 3,772,355 related to share repurchases through open market or private purchases, including the February 2017 ASR discussed above, and 185,477 related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units.

During 2016, the Company reacquired 6,483,198 shares of its common stock, of which 6,126,033 related to share repurchases through open market or private purchases, including the February 2016 ASR discussed above, and 357,165 related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units.

11. EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE (“EPS”)

The difference in the weighted average common shares outstanding for calculating basic and diluted EPS is a result of the dilution associated with the Company’s equity compensation plans. As noted in the table below, certain stock options and units outstanding under these equity compensation plans were not included in the computation of diluted EPS because they would not have had a dilutive effect.

The computations of the basic and diluted EPS amounts were as follows:



	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions, except per share)	2017		2016		2017		2016

Net income attributable to Ecolab		$ 296.6		$ 258.4		$ 550.1		$ 489.2

Weighted-average common shares outstanding
Basic		289.8		292.4		290.2		293.4
Effect of dilutive stock options and units		4.3		4.1		4.4		4.1
Diluted		294.1		296.5		294.6		297.5

Basic EPS		$ 1.02		$ 0.88		$ 1.90		$ 1.67
Diluted EPS		$ 1.01		$ 0.87		$ 1.87		$ 1.64

Anti-dilutive securities excluded from the computation of EPS		2.0		2.1		3.6		2.1

The Company’s diluted EPS for 2017 was impacted by the adoption of the new accounting guidance issued in March 2016 that amends the calculation of diluted EPS for share-based payments to exclude excess tax benefits or deficiencies from assumed proceeds during application of the treasury stock method.

12. INCOME TAXES

The Company’s tax rate was 21.4% and 24.1% for the second quarter of 2017 and 2016, respectively and 19.6% and 24.1% for the first six months of 2017 and 2016, respectively. The change in the Company’s tax rate for the second quarter and first six months of 2017 compared to second quarter and first six months of 2016 was primarily driven by the recognition of $10.8 million and $26.8 million, respectively of excess tax benefits related to employee share-based payments (resulting from the adoption of a new accounting standard as discussed in Note 1) and, to a lesser extent, global tax planning strategies.

The Company recognized net benefits related to discrete tax items of $9.7 million and $32.5 million during the second quarter and first six months of 2017, respectively, primarily driven by the $10.8 million and $26.8 million of share-based compensation excess tax benefits noted above. The remaining discrete tax benefits were primarily related to the release of reserves for uncertain tax positions due to the expiration of statute of limitations in non-U.S. jurisdictions.

The Company recognized net expenses related to discrete tax items of $3.9 million during the second quarter of 2016 and net benefits related to discrete tax items of $0.9 million during the first six months of 2016. Second quarter net expense was driven by individually immaterial items, including adjustments to deferred tax asset and liability positions. First quarter 2016 net benefits were driven primarily by the release of reserves for uncertain tax positions due to the expiration of statute of limitations in non-U.S. jurisdictions.

13. PENSION AND POSTRETIREMENT PLANS

The Company has a non-contributory qualified defined benefit pension plan covering the majority of its U.S. employees. The Company also has U.S. non-contributory non-qualified defined benefit plans, which provide for benefits to employees in excess of limits permitted under its U.S. pension plans. Various international subsidiaries also have defined benefit pension plans. The Company provides postretirement health care benefits to certain U.S. employees and retirees.

The components of net periodic pension and postretirement health care benefit costs for the second quarter ended June 30 are as follows:


	U.S.				International				U.S. Postretirement
	Pension				Pension				Health Care
(millions)	2017		2016		2017		2016		2017		2016
Service cost		$ 17.5		$ 16.8		$ 7.6		$ 7.0		$ 0.7		$ 0.8
Interest cost on benefit obligation		20.9		20.4		6.9		8.1		1.5		2.0
Expected return on plan assets		(37.4)		(35.9)		(13.7)		(13.5)		(0.1)		(0.2)
Recognition of net actuarial (gain) loss		7.2		7.7		4.5		3.6		(0.6)		(0.4)
Amortization of prior service
cost (benefit)		(1.7)		(1.7)		(0.2)		(0.2)		(4.2)		(0.1)
Total expense		$ 6.5		$ 7.3		$ 5.1		$ 5.0		$ (2.7)		$ 2.1

The components of net periodic pension and postretirement health care benefit costs for the six months ended June 30 are as follows:


	U.S.				International				U.S. Postretirement
	Pension				Pension				Health Care
(millions)	2017		2016		2017		2016		2017		2016
Service cost		$ 35.1		$ 33.5		$ 15.1		$ 13.9		$ 1.3		$ 1.5
Interest cost on benefit obligation		41.7		40.8		13.8		16.2		2.9		4.1
Expected return on plan assets		(74.9)		(71.8)		(27.4)		(27.0)		(0.3)		(0.4)
Recognition of net actuarial (gain) loss		14.3		15.4		8.9		7.2		(1.2)		(0.8)
Amortization of prior service
cost (benefit)		(3.4)		(3.5)		(0.3)		(0.4)		(8.3)		(0.1)
Total expense		$ 12.8		$ 14.4		$ 10.1		$ 9.9		$ (5.6)		$ 4.3

As of June 30, 2017, the Company is in compliance with all funding requirements of its U.S. pension and postretirement health care plans. During the first six months of 2017, the Company made payments of $4 million to its U.S. non-contributory non-qualified defined benefit plans and estimates it will make additional payments of approximately $3 million to such plans during the remainder of 2017.

The Company contributed $25 million to its international pension benefit plans during the first six months of 2017. The Company estimates it will contribute approximately an additional $17 million to such plans during the remainder of 2017.

During the first six months of 2017, the Company made payments of $8 million to its U.S. postretirement health care benefit plans and estimates it will make additional payments of approximately $8 million to such plans during the remainder of 2017.

The Company’s U.S. postretirement health care costs decreased in 2017 relative to the costs incurred in the comparable period of the prior year as a result of moving the U.S. postretirement healthcare plans to a Retiree Exchange approach for post-65 retiree medical coverage beginning in 2018 and the merger of Nalco U.S. postretirement health care plan with the Ecolab U.S. postretirement plan.

14. OPERATING SEGMENTS

The Company’s organizational structure consists of global business unit and global regional leadership teams. The Company’s operating segments follow its commercial and product-based activities and are based on engagement in business activities, availability of discrete financial information and review of operating results by the Chief Operating Decision Maker at the identified operating segment level.

The Company’s operating segments that share similar economic characteristics and future prospects, nature of the products and production processes, end-use markets, channels of distribution and regulatory environment have been aggregated into three reportable segments: Global Industrial, Global Institutional and Global Energy. The Company’s operating segments that do not meet the quantitative criteria to be separately reported have been combined into the Other segment. The Company provides similar information for the Other segment as the Company considers the information regarding its underlying operating segments as useful in understanding its consolidated results.

Comparability of Reportable Segments

The Company evaluates the performance of its non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminate the impact of exchange rate fluctuations on its international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. Fixed currency rates are generally based on existing market rates at the time they are established. The “Fixed Currency Rate Change” column shown in the following table reflects the impact on previously reported values related to fixed currency exchange rates established by management at the beginning of 2017.

Effective in the first quarter of 2017, the Company established the Life Sciences operating segment, to align with the strategy for growth in the pharmaceutical and personal care manufacturing operations. Life Sciences is comprised of operations previously recorded in the Food & Beverage and Healthcare operating segments and has been aggregated into the Global Industrial reportable segment. The Company also made immaterial changes to its reportable segments, including the movement of certain customers and cost allocations between reportable segments. These changes are presented in "Segment Change" column of the table below.

The impact of the preceding changes on previously reported full year 2016 reportable segment net sales and operating income is summarized as follows:


	December 31, 2016
			Fixed
	Values at		Currency		Segment	Values at
(millions)	2016 Rates		Rate Change		Change	2017 Rates
Net Sales
Global Industrial		$ 4,617.1		$ 6.9	$ 63.2	$ 4,687.2
Global Institutional		4,495.6		7.7	(63.2)	4,440.1
Global Energy		3,035.8		40.0	-	3,075.8
Other		806.5		(4.8)	-	801.7
Subtotal at fixed currency rates		12,955.0		49.8	-	13,004.8
Effect of foreign currency translation		197.8		(49.8)	-	148.0
Consolidated reported GAAP net sales		$ 13,152.8		$ -	$ -	$ 13,152.8

Operating Income
Global Industrial		$ 703.0		$ (0.9)	$ 17.9	$ 720.0
Global Institutional		966.7		3.0	(19.2)	950.5
Global Energy		337.1		7.9	1.7	346.7
Other		148.1		(2.5)	(0.4)	145.2
Corporate		(272.1)		(0.5)	-	(272.6)
Subtotal at fixed currency rates		1,882.8		7.0	-	1,889.8
Effect of foreign currency translation		32.2		(7.0)	-	25.2
Consolidated reported GAAP operating income		$ 1,915.0		$ -	$ -	$ 1,915.0

Reportable Segment Information

Financial information for each of the Company’s reportable segments, including the impact of all preceding segment structure changes, is as follows:


	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2017		2016		2017		2016
Net Sales
Global Industrial		$ 1,209.8		$ 1,170.8		$ 2,338.4		$ 2,266.3
Global Institutional		1,221.1		1,128.4		2,299.2		2,165.8
Global Energy		792.4		762.8		1,549.4		1,534.4
Other		215.3		202.2		412.1		388.9
Subtotal at fixed currency rates		3,438.6		3,264.2		6,599.1		6,355.4
Effect of foreign currency translation		24.1		53.0		25.2		59.2
Consolidated reported GAAP net sales		$ 3,462.7		$ 3,317.2		$ 6,624.3		$ 6,414.6

Operating Income
Global Industrial		$ 167.5		$ 174.5		$ 294.5		$ 306.0
Global Institutional		259.8		243.0		451.9		435.7
Global Energy		73.4		79.7		146.4		142.3
Other		37.0		38.2		66.9		67.8
Corporate		(102.6)		(129.8)		(152.0)		(177.9)
Subtotal at fixed currency rates		435.1		405.6		807.7		773.9
Effect of foreign currency translation		3.9		6.9		4.6		10.1
Consolidated reported GAAP operating income		$ 439.0		$ 412.5		$ 812.3		$ 784.0

The profitability of the Company’s operating segments is evaluated by management based on operating income. The Company has no intersegment revenues.

Consistent with the Company’s internal management reporting, Corporate amounts in the table above include amortization specifically from the Nalco merger and special (gains) and charges, as discussed in Note 2, that are not allocated to the Company’s reportable segments.

15. COMMITMENTS AND CONTINGENCIES

The Company is subject to various claims and contingencies related to, among other things, workers’ compensation, general liability (including product liability), automobile claims, health care claims, environmental matters and lawsuits. The Company also has contractual obligations related to lease commitments.

Insurance

Globally, the Company has insurance policies with varying deductible levels for property and casualty losses. The Company is insured for losses in excess of these deductibles, subject to policy terms and conditions and has recorded both a liability and an offsetting receivable for amounts in excess of these deductibles. The Company is self-insured for health care claims for eligible participating employees, subject to certain deductibles and limitations. The Company determines its liabilities for claims on an actuarial basis.

Litigation and Environmental Matters

The Company and certain subsidiaries are party to various lawsuits, claims and environmental actions that have arisen in the ordinary course of business. These include, from time to time, antitrust, commercial, patent infringement, product liability and wage hour lawsuits, as well as possible obligations to investigate and mitigate the effects on the environment of the disposal or release of certain chemical substances at various sites, such as Superfund sites and other operating or closed facilities. The Company has established accruals for certain lawsuits, claims and environmental matters. The Company currently believes that there is not a reasonably possible risk of material loss in excess of the amounts accrued related to these legal matters. Because litigation is inherently uncertain, and unfavorable rulings or developments could occur, there can be no certainty that the Company may not ultimately incur charges in excess of recorded liabilities. A future adverse ruling, settlement or unfavorable development could result in future charges that could have a material adverse effect on the Company’s results of operations or cash flows in the period in which they are recorded. The Company currently believes that such future charges related to suits and legal claims, if any, would not have a material adverse effect on the Company’s consolidated financial position.

Environmental Matters

The Company is currently participating in environmental assessments and remediation at approximately 40 locations, excluding recently acquired Anios locations that are currently under review. The majority of these locations are in the U.S. Environmental liabilities have been accrued reflecting management’s best estimate of future costs. Potential insurance reimbursements are not anticipated in the Company’s accruals for environmental liabilities.

Matters Related to Deepwater Horizon Incident Response

On April 22, 2010, the deepwater drilling platform, the Deepwater Horizon, operated by a subsidiary of BP plc, sank in the Gulf of Mexico after a catastrophic explosion and fire that began on April 20, 2010. A massive oil spill resulted. Approximately one week following the incident, subsidiaries of BP plc, under the authorization of the responding federal agencies, formally requested Nalco Company, now an indirect subsidiary of Ecolab, to supply large quantities of COREXIT® 9500, a Nalco oil dispersant product listed on the U.S. EPA National Contingency Plan Product Schedule. Nalco Company responded immediately by providing available COREXIT and increasing production to supply the product to BP’s subsidiaries for use, as authorized and directed by agencies of the federal government throughout the incident. Prior to the incident, Nalco and its subsidiaries had not provided products or services or otherwise had any involvement with the Deepwater Horizon platform. On July 15, 2010, BP announced that it had capped the leaking well, and the application of dispersants by the responding parties ceased shortly thereafter.

On May 1, 2010, the President appointed retired U.S. Coast Guard Commandant Admiral Thad Allen to serve as the National Incident Commander in charge of the coordination of the response to the incident at the national level. The EPA directed numerous tests of all the dispersants on the National Contingency Plan Product Schedule, including those provided by Nalco Company, “to ensure decisions about ongoing dispersant use in the Gulf of Mexico are grounded in the best available science.” Nalco Company cooperated with this testing process and continued to supply COREXIT, as requested by BP and government authorities. The use of dispersants by the responding parties was one tool used by the government and BP to avoid and reduce damage to the Gulf area from the spill.

In connection with its provision of COREXIT, Nalco Company has been named in several lawsuits as described below.

Cases arising out of the Deepwater Horizon accident were administratively transferred for pre-trial purposes to a judge in the United States District Court for the Eastern District of Louisiana with other related cases under In Re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010, Case No. 10-md-02179 (E.D. La.) (“MDL 2179”). Nalco Company was named, along with other unaffiliated defendants, in six putative class action complaints related to the Deepwater Horizon oil spill and 21 complaints filed by individuals. Those complaints were consolidated in MDL 2179. The complaints generally allege, among other things, strict liability and negligence relating to the use of our Corexit dispersant in connection with the Deepwater Horizon oil spill.

Pursuant to orders issued by the Court in MDL 2179, the claims were consolidated in several master complaints, including one naming Nalco Company and others who responded to the Gulf Oil Spill (known as the “B3 Master Complaint”). On May 18, 2012, Nalco filed a motion for summary judgment against the claims in the B3 Master Complaint, on the grounds that: (i) Plaintiffs’ claims are preempted by the comprehensive oil spill response scheme set forth in the Clean Water Act and National Contingency Plan; and (ii) Nalco is entitled to derivative immunity from suit. On November 28, 2012, the Court granted Nalco’s motion and dismissed with prejudice the claims in the “B3” Master Complaint asserted against Nalco. The Court held that such claims were preempted by the Clean Water Act and National Contingency Plan. Because claims in the “B3” Master Complaint remained pending against other defendants, the Court’s decision was not a “final judgment” for purposes of appeal. Under Federal Rule of Appellate Procedure 4(a), plaintiffs will have 30 days after entry of final judgment to appeal the Court’s decision.

In December 2012 and January 2013, the MDL 2179 court issued final orders approving two settlements between BP and Plaintiffs’ Class Counsel: (1) a proposed Medical Benefits Class Action Settlement; and (2) a proposed Economic and Property Damages Class Action Settlement. Pursuant to the proposed settlements, class members agree to release claims against BP and other released parties, including Nalco Company and its related entities.

Nalco Company, the incident defendants and the other responder defendants have been named as first party defendants by Transocean Deepwater Drilling, Inc. and its affiliates (the “Transocean Entities”) (In re the Complaint and Petition of Triton Asset Leasing GmbH, et al, MDL No. 2179, Civil Action 10-2771). In April and May 2011, the Transocean Entities, Cameron International Corporation, Halliburton Energy Services, Inc., M-I L.L.C., Weatherford U.S., L.P. and Weatherford International, Inc. (collectively, the “Cross Claimants”) filed cross claims in MDL 2179 against Nalco Company and other unaffiliated cross defendants. The Cross Claimants generally allege, among other things, that if they are found liable for damages resulting from the Deepwater Horizon explosion, oil spill and/or spill response, they are entitled to indemnity or contribution from the cross defendants.

In April and June 2011, in support of its defense of the claims against it, Nalco Company filed counterclaims against the Cross Claimants. In its counterclaims, Nalco Company generally alleges that if it is found liable for damages resulting from the Deepwater Horizon explosion, oil spill and/or spill response, it is entitled to contribution or indemnity from the Cross Claimants.

In May 2016, Nalco was named in nine additional complaints filed by individuals alleging, among other things, business and economic loss resulting from the Deepwater Horizon oil spill. In April 2017, Nalco was named in two additional complaints filed by individuals seeking, among other things, business and economic loss resulting from the Deepwater Horizon oil spill. The plaintiffs in these lawsuits are generally seeking awards of unspecified compensatory and punitive damages, and attorneys’ fees and costs. These actions have been consolidated in the MDL and the Company expects they will be dismissed pursuant to the Court’s November 28, 2012 order granting Nalco’s motion for summary judgment.

On February 22, 2017, the Court dismissed the “B3” Master Complaint and ordered that Plaintiffs who had previously filed a claim that fell within the scope of the “B3” Master Complaint and who had “opted out” of and not released their claims under the Medical Benefits Class Action Settlement either: (1) complete a sworn statement indicating, among other things, that they opted out of the Medical Benefits Class Action Settlement (to be completed by Plaintiffs who previously filed an individual complaint); or (2) file an individual lawsuit attaching the sworn statement as an exhibit, by a deadline date set by the Court. The Court will then determine which “B3” Plaintiffs are entitled to pursue their claims and the procedures for addressing those claims.

The Company believes the claims asserted against Nalco Company are without merit and intends to defend these lawsuits vigorously. The Company also believes that it has rights to contribution and/or indemnification (including legal expenses) from third parties. However, the Company cannot predict the outcome of these lawsuits, the involvement it might have in these matters in the future, or the potential for future litigation .

16. NEW ACCOUNTING PRONOUNCEMENTS


			Required
	Date of		Date of	Effect on the
Standard	Issuance	Description	Adoption	Financial Statements

Standards that are not yet adopted:

ASU 2017-07 - Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and the Net Periodic Postretirement Benefit Cost	March 2017	Amends the requirements related to income statement presentation of the components of net periodic benefit costs. New requirements include (1) disaggregate the current-service-cost component from the other components of net benefit cost (the “other components") and present it with other current compensation costs for related employees in the income statement and (2) present the other components elsewhere in the income statement and outside of income from operations if such a subtotal is presented.	January 1, 2018	Upon adoption of the standard, the Company will record only the service cost component with compensation cost in Cost of Sales and Selling, General, and Administrative costs. The other components of net period benefit cost will be presented below operating income. The Company will adopt the standard January 1, 2018. The Company is currently evaluating the impact of adoption.

ASU 2017-05 - Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Topic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets	February 2017	Clarifies the scope of guidance on nonfinancial asset derecognition (ASC 610-20) including the accounting for partial sales of nonfinancial assets. The ASU defines "in-substance nonfinancial asset". Also clarifies the decrecognition of all businesses should be accounted for in accordance with derecognition and deconsolidation guidance in 810-10.	January 1, 2018	The Company is currently evaluating the impact of adoption.

ASU 2017-04 - Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment	January 2017	Simplifies subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill.	January 1, 2020	The ASU must be applied on a prospective basis upon adoption. The Company is currently evaluating the impact of adoption.

ASU 2017-01--Business Combinations (Topic 805): Clarifying the Definition of a Business	January 2017	Clarifies the definition of a business and provides guidance on whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses.	January 1, 2018	The Company is currently evaluating the impact of adoption.

ASU 2016-18 - Statement of Cash Flows (Topic 230): Restricted Cash	November 2016	Clarifies guidance on the classification and presentation of restricted cash in the statement of cash flows.	January 1, 2018	Presentation impact only related to restricted cash. The Company does not expect the updated guidance to have a significant impact on future financial statements.

ASU 2016-16 - Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory	October 2016	Simplifies the guidance on the accounting for the income tax consequences of intra-entity transfers of assets other than inventory (e.g. intellectual property).	January 1, 2018	The Company is currently evaluating the impact of adoption.

ASU 2016-15 - Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments	August 2016	The guidance's objective is to reduce diversity in practice of how certain cash receipts and cash payments are presented and classified in the statement of cash flow.	January 1, 2018	Presentation impact only related to eight specific cash flow items. The Company is currently evaluating the impact of adoption.

ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	June 2016	Addresses the recognition, measurement, presentation and disclosure of credit losses on trade and reinsurance receivables, loans, debt securities, net investments in leases, off-balance-sheet credit exposures and certain other instruments. Amends guidance on reporting credit losses from an incurred model to an expected model for assets held at amortized cost, such as accounts receivable, loans and held-to-maturity debt securities. Additional disclosures will also be required.	January 1, 2020	Adoption of the standard will change how the allowance for trade and other receivables is calculated. The Company is currently evaluating the impact of adoption.

ASU 2016-02 - Leases (Topic 842)	February 2016	Introduces the recognition of lease assets and lease liabilities by lessors for those leases classified as operating leases under previous guidance.	January 1, 2019	See additional information regarding the impact of this guidance on the Company's financials at the bottom of this table in note (a).

Revenue Recognition ASUs: 2014-09 - Revenue from Contracts with Customers 2015-14 - Deferral of the Effective Date 2016-08 - Principal Versus Agent Considerations 2016-10 - Identifying Performance Obligations and Licensing 2016-11 - Revenue Recognition and Derivatives and Hedging 2016-12 - Narrow-Scope Improvements & Practical Expedients 2016-20--Technical Corrections and Improvements	Various	Recognition standard contains principles for entities to apply to determine the measurement of revenue and timing of when the revenue is recognized. The underlying principle of the updated guidance will have entities recognize revenue to depict the transfer of goods or services to customers at an amount that is expected to be received in exchange for those goods or services.	January 1, 2018	See additional information regarding the impact of this guidance on the Company's financials at the bottom of this table in note (b).

(a)

As part of implementing the new standard, the Company is in process of reviewing current accounting policies and assessing the practical expedients allowed under the new accounting guidance. In addition, the project team has started to compile and evaluate various leases. The Company expects that most of its operating lease commitments will be subject to the new standard and recognized as operating lease liabilities and right-of-use assets upon adoption and is currently evaluating other impacts on the consolidated financial statements. The standard requires a modified retrospective transition to be applied at the beginning of the earliest comparative period presented in the year of adoption.

(b)

The Company’s approach to implementing the new standard includes performing a detailed review of key contracts representative of its different businesses, and comparing historical accounting policies and practices to the new standard. The Company’s focus on the identification and evaluation of performance obligations within certain contracts has identified additional performance obligations within contracts which relate to providing services to customers. These additional performance obligations, when aggregated with the service revenue that is currently reported, represent more than 10% of consolidated net sales. Upon adoption of the new standard, service revenues are expected to be reported separately from product revenues. Additionally, the Company anticipates certain costs currently classified in Selling, General, and Administrative expenses will be reclassified as Cost of Sales as they are tied to satisfaction of a service performance obligation. In addition to expanded disclosures associated with the new standard, the Company is continuing the assessment of the impact on the consolidated financial statements. The guidance permits two methods of adoption, retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The Company currently anticipates utilizing the full retrospective method of adoption on January 1, 2018, which is dependent upon the completion of the analysis of information necessary to restate prior period financial statements.


	Date of		Date of	Effect on the
Standard	Issuance	Description	Adoption	Financial Statements

Standards that were adopted:

ASU 2015-11 - Inventory (Topic 330): Simplifying the Measurement of Inventory	July 2015	The amendment requires entities to measure inventory under the FIFO or average cost methods at the lower of cost or net realizable value.	January 1, 2017	The adoption of the guidance did not have a material impact on the Company's financial statements.

ASU 2016-01 - Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	January 2016	The amendment revises accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments.	January 1, 2017	The adoption of the guidance did not have a material impact on the Company's financial statements.

ASU 2016-05 - Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships	March 2016	The amendment clarifies language related to hedge accounting criteria that a change in the counterparty is not in and of itself considered a termination of the derivative or critical term of the hedging relationship.	January 1, 2017	The adoption of the guidance did not have a material impact on the Company's financial statements.

ASU 2016-07 - Investments - Equity Method and Joint Ventures: Simplifying the Transition to the Equity Method of Accounting	March 2016	Simplifies the transition to equity method accounting for entities that have an investment that becomes qualified for the equity method of accounting as a result of an increase in the level of ownership interest or degree of influence.	January 1, 2017	The adoption of the guidance did not have a material impact on the Company's financial statements.

ASU 2016-09 - Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting	March 2016	The amendment includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements.	January 1, 2017	The Company included appropriate disclosures within this 10-Q to adhere to this new ASU.

ASU 2017-03 - Accounting Changes and Error Corrections (Topic 250) and Investments-Equity Method and Joint Ventures (Topic 323)	January 2017	Amends the disclosure requirements associated with certain recently issued Accounting Standards and how they will have an impact on the Financial Statements of a registrant when such standards are adopted in a future period. It applies to ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606); ASU No. 2016-02, Leases (Topic 842); and ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and any subsequent amendments to these ASU's.	Effective Immediately	The Company included appropriate disclosure requirements within this 10-Q to adhere to this new ASU.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of Ecolab Inc.:

We have reviewed the accompanying consolidated balance sheet of Ecolab Inc. and its subsidiaries as of June 30, 2017, and the related consolidated statements of income and comprehensive income for the six-month periods ended June 30, 2017 and 2016 and the consolidated statement of cash flows for the six-month periods ended June 30, 2017 and 2016. These interim financial statements are the responsibility of the Company’s management.

We conducted our review 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 statements taken as a whole. Accordingly, we do not express such an opinion.

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

We previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet as of December 31, 2016, and the related consolidated statements of income, comprehensive income and equity, and of cash flows for the year then ended (not presented herein), and in our report dated February 24, 2017, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet information as of December 31, 2016, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.


/s/ PricewaterhouseCoopers LLP


PricewaterhouseCoopers LLP
Minneapolis, Minnesota
August 3, 2017

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following management discussion and analysis (“MD&A”) provides information that we believe is useful in understanding our operating results, cash flows and financial condition. We provide quantitative information about the material sales drivers including the impact of changes in volume and pricing and the effect of acquisitions and changes in foreign currency at the corporate and segment level. We also provide quantitative information regarding special (gains) and charges, discrete tax items and other significant factors we believe are useful for understanding our results. Such quantitative drivers are supported by comments meant to be qualitative in nature. Qualitative factors are generally ordered based on estimated significance.

The MD&A should be read in conjunction with both the unaudited consolidated financial information and related notes included in this Form 10-Q, and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2016. This discussion contains various “Non-GAAP Financial Measures” and also contains various “Forward-Looking Statements” within the meaning of the Private Securities Litigation Reform Act of 1995. We refer readers to the statements entitled “Non-GAAP Financial Measures” and “Forward-Looking Statements” located at the end of Part I of this report.

Comparability of Results

Fixed Currency Foreign Exchange Rates

Management evaluates the sales and operating income performance of our non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminate the impact of exchange rate fluctuations on our international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. Fixed currency exchange rates are generally based on existing market rates at the time they are established.

Comparability of Reportable Segments

Effective in the first quarter of 2017, in order to align with the strategy for growth specifically in the pharmaceutical and personal care manufacturing operations, we established the Life Sciences operating segment. Life Sciences is comprised of customers and accounts that were previously included in our Food & Beverage and Healthcare operating segments, which were related to manufacturing in the following industries: pharmaceutical, animal health and medicine, biologic products, cosmetics and medical device. The Life Sciences operating segment is included in our Global Industrial reportable segment. All comparisons and discussion throughout the MD&A are based on the new operating segment structure effective in the first quarter of 2017.

Impact of Acquisitions and Divestitures

Acquisition adjusted growth rates exclude the results of our acquired businesses from the first twelve months post acquisition, exclude the results of our divested businesses from the twelve months prior to divestiture, and exclude sales to our deconsolidated Venezuelan subsidiaries from both the current period and comparable period of the prior year.

OVERVIEW OF THE SECOND QUARTER ENDED JUNE 30, 2017

Sales Performance

When comparing second quarter 2017 against second quarter 2016, sales performance was as follows:

Reported net sales increased 4% to $3,463 million, fixed currency and acquisition adjusted fixed currency sales increased 5% and 4%, respectively.

Fixed currency sales for our Global Industrial segment increased 3% to $1,210 million, led by Water.

Fixed currency sales for our Global Institutional segment increased 8% to $1,221 million, acquisition adjusted fixed currency sales increased 3%, led by growth in Specialty and Healthcare.

Fixed currency sales for our Global Energy segment increased 4% to $792 million, acquisition adjusted fixed currency sales increased 5%, as strong growth in well stimulation business and modest gains in the downstream business were offset by a decline in our production business.

Fixed currency sales for our Other segment sales increased 6% to $215 million, driven by sales growth in Pest Elimination.

Financial Performance

When comparing second quarter 2017 against second quarter 2016, financial performance was as follows:

Reported operating income increased 6% to $439 million. Excluding the impact of special (gains) and charges from both 2017 and 2016 reported results, adjusted operating income was flat and our adjusted fixed currency operating income increased 1%. Acquisition adjusted fixed currency operating income decreased 1%.

Net income attributable to Ecolab increased 15% to $297 million. Excluding the impact of special (gains) and charges and discrete tax items from both 2017 and 2016 reported results, our adjusted net income attributable to Ecolab increased 4%.

Diluted EPS of $1.01 increased 16%. Excluding the impact of special (gains) and charges and discrete tax items from both 2017 and 2016 reported results, adjusted diluted EPS increased 5% to $1.13 in the second quarter of 2017.

Our reported tax rate was 21.4% during the second quarter of 2017, compared to 24.1% during the second quarter of 2016. Excluding the tax rate impact of special (gains) and charges and discrete tax items from both 2017 and 2016 results, our adjusted tax rate was 24.2% and 25.5% during the second quarter of 2017 and 2016, respectively.

RESULTS OF OPERATIONS

Net Sales


	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2017		2016		Change		2017		2016		Change
Reported GAAP net sales		$ 3,462.7		$ 3,317.2	4	%		$ 6,624.3		$ 6,414.6	3	%
Effect of foreign currency translation		(24.1)		(53.0)				(25.2)		(59.2)
Non-GAAP fixed currency sales		$ 3,438.6		$ 3,264.2	5	%		$ 6,599.1		$ 6,355.4	4	%

The percentage components of the period-over-period 2017 sales change are shown below:



	Second Quarter Ended	Six Months Ended
	June 30	June 30
(percent)	2017	2017
Volume	3%	2%
Price changes	1	1
Acquisition adjusted fixed currency sales change	4	3
Acquisitions and divestitures	1	1
Fixed currency sales change	5	4
Foreign currency translation	(1)	(1)
Reported GAAP net sales change	4%	3%

Cost of Sales (“COS”) and Gross Profit Margin


	Second Quarter Ended								Six Months Ended
	June 30								June 30
	2017				2016				2017				2016
			Gross				Gross				Gross				Gross
(millions/percent)	COS		Margin		COS		Margin		COS		Margin		COS		Margin
Reported GAAP COS and gross margin		$ 1,871.6	45.9	%		$ 1,785.2	46.2	%		$ 3,563.1	46.2	%		$ 3,416.6	46.7	%
Special (gains) and charges		24.4	0.8			61.9	1.8			25.9	0.4			61.9	1.0
Non-GAAP adjusted COS and gross margin		$ 1,847.2	46.7	%		$ 1,723.3	48.0	%		$ 3,537.2	46.6	%		$ 3,354.7	47.7	%

Our COS and corresponding gross profit margin (“gross margin”) are shown in the table above. Our gross margin is defined as sales less cost of sales divided by sales.

Our reported gross margin was 45.9% and 46.2% for the second quarter of 2017 and 2016, respectively. Our reported gross margin for the first six months of 2017 and 2016 was 46.2% and 46.7%, respectively.

Excluding the impact of special (gains) and charges within COS, our second quarter 2017 adjusted gross margin was 46.7% and our adjusted gross margin for the first six months of 2017 was 46.6%. These percentages compared against a second quarter 2016 adjusted gross margin of 48.0% and an adjusted gross margin of 47.7% for the first six months of 2016.

Our adjusted gross margin decrease when comparing the second quarter of 2017 against the second quarter of 2016 and the comparable periods for the first six months of 2017 and 2016 was driven primarily by higher delivered product costs, which include an unfavorable currency hedge impact when compared to 2016, which more than offset pricing and cost savings.

Selling, General and Administrative Expense

Selling, general and administrative (“SG&A”) expenses as a percentage of sales were 32.2% for the second quarter of 2017 compared to 33.0% in 2016. For the six month period, SG&A expenses were 33.3% of sales in 2017 compared to 34.0% in 2016.The decreased SG&A ratio to sales across the periods was driven primarily by sales volume leverage and cost savings, which more than offset investments in the business.

Special (Gains) and Charges

Special (gains) and charges reported on the Consolidated Statement of Income included the following items:



	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2017		2016		2017		2016
Cost of sales
Restructuring activities		2.2		0.9		2.2		0.9
Acquisition and integration costs		11.1		-		12.6		-
Energy related charges		-		51.0		-		51.0
Other		11.1		10.0		11.1		10.0
Subtotal		24.4		61.9		25.9		61.9

Special (gains) and charges
Restructuring activities		30.8		(2.1)		30.5		0.9
Acquisition and integration costs		4.6		1.0		10.9		3.3
Energy related charges		-		12.6		-		12.6
Venezuela related gain		(5.3)		(7.8)		(5.3)		(7.8)
Other		6.7		22.5		6.9		23.5
Subtotal		36.8		26.2		43.0		32.5

Total special (gains) and charges		$ 61.2		$ 88.1		$ 68.9		$ 94.4

Restructuring activities

Restructuring activities have been included as a component of both cost of sales and special (gains) and charges on the Consolidated Statement of Income. Restructuring liabilities have been classified as a component of both other current and other noncurrent liabilities on the Consolidated Balance Sheet.

During the second quarter of 2017, we commenced restructuring and other cost-saving actions in order to streamline our operations. These actions include a reduction of our global workforce by approximately 530 positions, as well as asset disposals and lease terminations. As a result of these actions, we expect to incur approximately $40 to $45 million ($30 to $35 million after tax) of restructuring charges. During the second quarter of 2017, we recorded restructuring charges of $33.0 million ($25.0 million after tax) or $0.08 per diluted share, related primarily to employee termination costs. The remaining charges are expected to be recognized during the second half of 2017. As of June 30, 2017, the restructuring liability balance related to these activities was $28.4 million. We anticipate that the majority of the pretax charges will represent net cash expenditures which are expected to be paid over a period of a few months to several quarters and will be funded from operating activities. Cash payments during the second quarter of 2017 were minimal.

Net restructuring gains and charges related to our Energy and Combined restructuring plans during 2017 were minimal. During the second quarter and first six months of 2016, net restructuring activities included net restructuring gains of $1.2 million ($1.9 million after tax) or $0.01 per diluted share and net restructuring charges of $1.8 million ($0.1 million gain after tax) or less than $0.01 per diluted share, respectively. The restructuring liability balance was $28.4 million and $39.6 million as of June 30, 2017 and December 31, 2016, respectively. The reduction in liability was driven primarily by severance and other cash payments. The remaining accrual is expected to be paid over a period of a few months to several quarters and continues to be funded from operating activities.

Acquisition and integration related costs

Acquisition and integration costs reported in cost of sales on the Consolidated Statement of Income include $11.1 million ($7.0 million after tax) or $0.02 per diluted share and $12.6 million ($8.0 million) or $0.03 per diluted share during the second quarter and first six months of 2017, respectively, related primarily to recognition of accelerated rent expense upon the closure of Swisher plants and disposal of excess inventory. The second quarter and first six months of 2017 also include amounts related to recognition of fair value step-up in the Anios inventory.

Acquisition and integration costs reported in special (gains) and charges on the Consolidated Statement of Income include $4.6 million ($3.0 million after tax) or $0.01 per diluted share and $10.9 million ($7.3 million after tax) or $0.02 per diluted share of acquisition costs, advisory and legal fees, and integration charges for the Anios and Swisher acquisitions during the second quarter and first six months of 2017, respectively.

During the second quarter and first six months of 2016, we incurred acquisition and integration charges of $1.0 million ($0.7 million after tax) or less than $0.01 per diluted share and $3.3 million ($2.1 million after tax) or $0.01 per diluted share, respectively. Further information related to our acquisitions is included in Note 3.

Energy related charges

Oil industry activity remained depressed during 2016 when compared with 2014 levels, resulting from continued excess oil supply pressures, which have negatively impacted exploration and production investments in the energy industry, particularly in North America. As a result of these conditions and their corresponding impact on our business outlook, we recorded total charges of $63.6 million ($42.9 million after tax) or $0.14 per diluted share during the second quarter and first six months of 2016, comprised of inventory write downs and related disposal costs, fixed asset charges, headcount reductions and other charges. No such charges were incurred in 2017.

The inventory write-downs and related disposal costs of $31.1 million include adjustments due to the significant decline in activity and related prices of certain specific-use and other products, coupled with declines in replacement costs, as well as estimated costs to dispose the respective excess inventory. The fixed asset charges of $18.2 million resulted from the write-down of certain assets related to the reduction in certain aspects of our North American Global Energy segment, as well as abandonment of certain projects under construction. The carrying value of the corresponding fixed assets was reduced to zero. The employee termination costs of $12.8 million include a reduction in the Global Energy segment’s global workforce to better align its workforce with anticipated activity levels in the near term. As of the end of the second quarter of 2017, we had $4.3 million of corresponding severance remaining to be paid, which is expected to paid in the next several months and be funded from operating activities.

The charges discussed above have been included as a component of both cost of sales and special (gains) and charges on the Consolidated Statement of Income.

Venezuela related gain

Effective as of the end of the fourth quarter of 2015, we deconsolidated our Venezuelan subsidiaries. During the second quarter of 2017 and 2016, we recorded gains of $5.3 million ($3.3 million after tax) or $0.01 per diluted share and $7.8 million ($4.9 million after tax) or $0.02 per diluted share, respectively, resulting from U.S. dollar cash recoveries of intercompany receivables written off at the time of deconsolidation.

Other

During the second quarter and first six months of 2017, we recorded charges of $17.8 million ($14.4 million after tax) or $0.04 per diluted share and $18.0 million ($14.5 million after tax) or $0.04 per diluted share, respectively, related to a Global Energy vendor contract termination and litigation related charges. These charges have been included as a component of both cost of sales and special (gains) and charges on the Consolidated Statement of Income.

During the second quarter and first six months of 2016, we recorded a charge of $10.0 million ($6.3 million after tax) or $0.02 per diluted share related to a fixed asset impairment and related inventory charges. The fixed asset impairment corresponds to additional charges of certain U.S. production equipment and buildings, resulting from further lower production, initially impaired during the fourth quarter of 2015. This charge has been included as a component of cost of sales on the Consolidated Statement of Income.

Additionally, during the second quarter and first six months of 2016, we recorded charges of $22.5 million ($13.9 million after tax) or $0.05 per diluted share and $23.5 million ($15.1 million after tax) or $0.05 per diluted share, respectively, primarily consisting of litigation related charges. These charges have been included as a component of special (gains) and charges on the Consolidated Statement of Income.

Operating Income and Operating Income Margin



	Second Quarter Ended								Six Months Ended
	June 30								June 30
(millions)	2017			2016			Change		2017			2016			Change
Reported GAAP operating income		$ 439.0			$ 412.5		6	%		$ 812.3			$ 784.0		4	%
Special (gains) and charges		61.2			88.1					68.9			94.4
Non-GAAP adjusted operating income		500.2			500.6		(0)			881.2			878.4		0
Effect of foreign currency translation		(3.9)			(6.9)					(4.6)			(10.1)
Non-GAAP adjusted fixed currency operating income		$ 496.3			$ 493.7		1	%		$ 876.6			$ 868.3		1	%

	Second Quarter Ended								Six Months Ended
	June 30								June 30
(percent)	2017			2016					2017			2016
Reported GAAP operating income margin		12.7	%		12.4	%				12.3	%		12.2	%
Non-GAAP adjusted operating income margin		14.4	%		15.1	%				13.3	%		13.7	%
Non-GAAP adjusted fixed currency operating income margin		14.4	%		15.1	%				13.3	%		13.7	%

Our operating income and corresponding operating income margin are shown in the previous tables. Operating income margin is defined as operating income divided by sales.

Reported operating income increased 6% and 4% in the second quarter and the first six months of 2017, respectively, versus the comparable periods of 2016. Excluding the impact of special (gains) and charges from 2017 and 2016 reported results, our adjusted operating income was flat in both the second quarter and the first six months of 2017.

Foreign currency had a negative impact on operating income growth, as adjusted fixed currency operating income increased 1% in both in the second quarter and the first six months of 2017, when compared against the second quarter and first six months of 2016. The net impact of acquisitions and divestitures added approximately 2 and 1 percentage point, respectively, to our second quarter and first six months of 2017 adjusted fixed currency operating income growth rates.

Our second quarter and first six months of 2017 adjusted fixed currency operating income increase was driven by pricing, volume growth and cost savings in our Global Institutional, Global Industrial and Other segments, which more than offset higher delivered product costs, which includes unfavorable currency hedge impact when compared to 2016, and investments in the business.

Interest Expense, Net

Net interest expense was $59.6 million and $65.3 million in the second quarter of 2017 and 2016, respectively. Net interest expense in the first six months of 2017 and 2016 was $122.1 million and $131.4 million, respectively. The decrease in net interest expense when comparing 2017 against 2016 was driven primarily by lower weighted average interest rates on outstanding debt and a change in the mix of currencies used in our hedging portfolio.

Provision for Income Taxes

The following table provides a summary of our tax rate:


	Second Quarter Ended				Six Months Ended
	June 30				June 30
(percent)	2017		2016		2017		2016
Reported GAAP tax rate	21.4	%	24.1	%	19.6	%	24.1	%
Tax rate impact of:
Special gains and charges	0.6		2.3		0.6		1.4
Discrete tax items	2.2		(0.9)		4.3		0.1
Non-GAAP adjusted tax rate	24.2	%	25.5	%	24.5	%	25.6	%

Our reported tax rate for 2017 and 2016 includes the tax rate impact of special gains and charges and discrete tax items, which have impacted the comparability of our historical reported tax rates, as amounts included in our special gains and charges are derived from tax jurisdictions with rates that vary from our overall non-GAAP adjusted tax rate, and discrete tax items are not necessarily consistent across periods. The tax impact of special gains and charges and discrete tax items will likely continue to impact comparability of our reported tax rate in the future.

Our second quarter 2017 reported tax expense included $15.6 million of net tax benefits on special gains and charges and net benefits of $9.7 million associated with discrete tax items. For the first six months of 2017, our reported tax expense included $18.1 million of net tax benefits on special gains and charges and net benefits of $32.5 million associated with discrete tax items.

Our second quarter and first six months of 2017 reported tax expenses were lower than the comparable periods of 2016 primarily due to $10.8 million and $26.8 million of excess tax benefits recorded in the second quarter and first six months of 2017, respectively, resulting from the adoption of accounting changes regarding the treatment of tax benefits on share-based compensation. The extent of excess tax benefits is subject to variation in stock price and stock option exercises. We expect excess tax benefits to impact the rate by approximately 1% to 3% for the full year of 2017.

The remaining discrete tax benefits in 2017 were driven primarily by the release of reserves for uncertain tax positions due to the expiration of statute of limitations in non-U.S. jurisdictions. The corresponding impact of these items on the reported tax rate is shown in the previous table.

Our second quarter 2016 reported tax expense included $31.1 million of net tax benefits on special gains and charges and net expense of $3.9 million associated with discrete tax items. For the first six months of 2016, our reported tax expense included $33.0 million of net tax benefits on special gains and charges and net benefits of $0.9 million associated with discrete tax items. The corresponding impact of these items on the reported tax rate is shown in the previous table.

Second quarter 2016 discrete tax items net expense was driven by individually immaterial items, including adjustments to deferred tax asset and liability positions. First quarter 2016 discrete tax items net benefits were driven primarily by the release of reserves for uncertain tax positions due to the expiration of statute of limitations in non-U.S. jurisdictions.

The decrease in the 2017 adjusted tax rate compared to 2016 was primarily driven by global tax planning strategies.

Net Income Attributable to Ecolab


	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2017		2016		Change		2017		2016		Change
Reported GAAP net income attributable to Ecolab		$ 296.6		$ 258.4	15	%		$ 550.1		$ 489.2	12	%
Adjustments:
Special (gains) and charges, after tax		45.6		57.0				50.8		61.4
Discrete tax net expense (benefit)		(9.7)		3.9				(32.5)		(0.9)
Non-GAAP adjusted net income attributable to Ecolab		$ 332.5		$ 319.3	4	%		$ 568.4		$ 549.7	3	%

Diluted EPS


	Second Quarter Ended						Six Months Ended
	June 30						June 30
(dollars)	2017		2016		Change		2017		2016		Change
Reported GAAP diluted EPS		$ 1.01		$ 0.87	16	%		$ 1.87		$ 1.64	14	%
Adjustments:
Special (gains) and charges		0.16		0.19				0.17		0.21
Discrete tax net expense (benefit)		(0.03)		0.01				(0.11)		(0.00)
Non-GAAP adjusted diluted EPS		$ 1.13		$ 1.08	5	%		$ 1.93		$ 1.85	4	%

Per share amounts in the above tables do not necessary sum due to rounding.

Currency translation had minimal impact on diluted EPS for both the second quarter and first six months of 2017, when compared to the second quarter and first six months of 2016.

SEGMENT PERFORMANCE

Fixed currency sales and operating income for the second quarter and first six months of 2017 and 2016 for each of our reportable segments were as follows:


Net Sales	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2017		2016		Change		2017		2016		Change
Global Industrial		$ 1,209.8		$ 1,170.8	3	%		$ 2,338.4		$ 2,266.3	3	%
Global Institutional		1,221.1		1,128.4	8			2,299.2		2,165.8	6
Global Energy		792.4		762.8	4			1,549.4		1,534.4	1
Other		215.3		202.2	6			412.1		388.9	6
Subtotal at fixed currency		3,438.6		3,264.2	5			6,599.1		6,355.4	4
Effect of foreign currency translation		24.1		53.0				25.2		59.2
Consolidated reported GAAP net sales		$ 3,462.7		$ 3,317.2	4	%		$ 6,624.3		$ 6,414.6	3	%

Operating Income	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2017		2016		Change		2017		2016		Change
Global Industrial		$ 167.5		$ 174.5	(4)	%		$ 294.5		$ 306.0	(4)	%
Global Institutional		259.8		243.0	7			451.9		435.7	4
Global Energy		73.4		79.7	(8)			146.4		142.3	3
Other		37.0		38.2	(3)			66.9		67.8	(1)
Corporate		(102.6)		(129.8)				(152.0)		(177.9)
Subtotal at fixed currency		435.1		405.6	7			807.7		773.9	4
Effect of foreign currency translation		3.9		6.9				4.6		10.1
Consolidated reported GAAP operating income		$ 439.0		$ 412.5	6	%		$ 812.3		$ 784.0	4	%

Unless otherwise noted, the following segment performance commentary compares the second quarter and first six months of 2017 against the second quarter and first six months of 2016.

Global Industrial


	Second Quarter Ended						Six Months Ended
	June 30						June 30
	2017			2016			2017			2016
Sales at fixed currency (millions)		$ 1,209.8			$ 1,170.8			$ 2,338.4			$ 2,266.3
Sales at public currency (millions)		1,223.0			1,196.7			2,352.5			2,297.4

Volume		2	%					2	%
Price changes		1	%					1	%
Acquisition adjusted fixed currency sales change		3	%					3	%
Acquisitions and divestitures		1	%					0	%
Fixed currency sales change		3	%					3	%
Foreign currency translation		(1)	%					(1)	%
Public currency sales change		2	%					2	%

Operating income at fixed currency (millions)		$ 167.5			$ 174.5			$ 294.5			$ 306.0
Operating income at public currency (millions)		170.1			178.5			297.5			311.9

Fixed currency operating income change		(4)	%					(4)	%
Fixed currency operating income margin		13.8	%		14.9	%		12.6	%		13.5	%
Acquisition adjusted fixed currency operating income change		(4)	%					(4)	%
Acquisition adjusted fixed currency operating income margin		13.9	%		14.9	%		12.6	%		13.5	%
Public currency operating income change		(5)	%					(5)	%

Percentages in the above table do not necessary sum due to rounding.

Net Sales

Fixed currency sales for Global Industrial increased in the second quarter and first six months of 2017, benefitting from volume gains and pricing. At a regional level, both the second quarter and first six months sales showed good growth in Asia Pacific, North America and Latin America.

At an operating segment level, Water fixed currency sales increased 4% (3% acquisition adjusted) in the second quarter of 2017 and 3% (2% acquisition adjusted) in the first six months of 2017. Good growth in light industry sales led by innovative technology and service offerings. Heavy industry also recorded minimal growth. Mining sales were relatively stable as new business wins were offset by the impact of prior mine closures. Food & Beverage fixed currency sales increased 3% in the second quarter of 2017 and 3% in the first six months of 2017, benefiting from corporate account share gains and pricing, which more than offset generally flat industry trends. Growth was led by the food, beverage and brew markets. Paper fixed currency sales increased 2% in the second quarter of 2017 and 3% in the first six months of 2017, benefiting from strong sales efforts and business wins, which more than offset challenging market conditions in China and Europe. Textile Care fixed currency sales increased 2% in the second quarter of 2017 and 3% in the first six months of 2017, benefiting from new customer accounts in Europe. Life Sciences fixed currency sales increased 5% in the second quarter of 2017 and 7% in the first six months of 2017. Good growth from business wins and pricing execution, led by strong sales of cleaning and disinfection programs in the pharmaceutical market and better program penetration in the personal care market.

Operating Income

Fixed currency operating income and fixed currency operating income margins for Global Industrial decreased in both the second quarter and first six months of 2017. Acquisitions had minimal impact on both the fixed currency operating income growth and fixed currency operating income margins.

Acquisition adjusted fixed currency operating income margins decreased 1.0 and 0.9 percentage points during the second quarter and first six months of 2017, respectively, negatively impacted by approximately 2.5 and 1.9 percentage points for the respective periods, related to higher delivered product costs, which includes an unfavorable currency hedge impact, and investments in business. Favorable impact of sales volume gains and pricing added approximately 1.2 and 0.7 percentage points during the second quarter and first six months of 2017, respectively.

Global Institutional


	Second Quarter Ended						Six Months Ended
	June 30						June 30
	2017			2016			2017			2016
Sales at fixed currency (millions)		$ 1,221.1			$ 1,128.4			$ 2,299.2			$ 2,165.8
Sales at public currency (millions)		1,226.1			1,144.3			2,303.4			2,185.3

Volume		2	%					2	%
Price changes		1	%					1	%
Acquisition adjusted fixed currency sales change		3	%					3	%
Acquisitions and divestitures		5	%					3	%
Fixed currency sales change		8	%					6	%
Foreign currency translation		(1)	%					(1)	%
Public currency sales change		7	%					5	%

Operating income at fixed currency (millions)		$ 259.8			$ 243.0			$ 451.9			$ 435.7
Operating income at public currency (millions)		260.1			245.2			452.2			438.6

Fixed currency operating income change		7	%					4	%
Fixed currency operating income margin		21.3	%		21.5	%		19.7	%		20.1	%
Acquisition adjusted fixed currency operating income change		3	%					1	%
Acquisition adjusted fixed currency operating income margin		21.6	%		21.7	%		19.8	%		20.3	%
Public currency operating income change		6	%					3	%

Percentages in the above table do not necessary sum due to rounding.

Net Sales

Fixed currency sales for Global Institutional increased in the second quarter and first six months of 2017, driven by volume growth, acquisitions and pricing gains. At a regional level, both the second quarter and first six months sales increase was led by good growth in Latin America and North America.

At an operating segment level, Institutional fixed currency sales increased 1% in both the second quarter of 2017 and first six months of 2017. Acquisition adjusted fixed currency sales increased 2% in both the second quarter and first six months of 2017, respectively, when adjusting for the divestiture of the restroom cleaning business initially acquired through the Swisher transaction. Global lodging demand continued to show modest growth while global full service restaurant industry foot traffic remained soft, particularly in North America. Specialty fixed currency sales 10% in the second quarter of 2017 and 7% in the first six months of 2017, led primarily by new account wins and growth in global quick service accounts, leveraging generally modest industry trends. New business gains remain strong, driven by increased service coverage, new product innovations, additional customer solutions and a continued focus among our customers on food safety. In addition, the timing of some existing customer shipments benefited the second quarter. Healthcare fixed currency sales increased 52% in the second quarter of 2017 and 37% in the first six months of 2017. Fixed currency sales increased 5% in both the second quarter and first six months of 2017, respectively, when adjusted for the Anios acquisition. Strong growth for Healthcare in North America and Europe reflected the continued focus on our value proposition, leading to customer gains and product penetration.

Operating Income

Fixed currency operating income for our Global Institutional segment increased in both the second quarter and first six months of 2017. Fixed currency operating income margins decreased in both the second quarter and first six months of 2017. Acquisitions had a positive impact on fixed currency operating income growth and minimal impact on fixed currency operating income margins.

Acquisition adjusted fixed currency operating income margins decreased by 0.1 percentage points and 0.5 percentage points during the second quarter and first six months of 2017, respectively, negatively impacted by approximately 1.7 and 1.8 percentage points for the respective periods, related to innovation and customer investments and higher delivered product costs, which includes an unfavorable currency hedge impact. Sales volume and pricing gains favorably impacted acquisition adjusted fixed currency operating income margins by adding approximately 1.4 percentage points in both the second quarter and first six months of 2017.

Global Energy


	Second Quarter Ended						Six Months Ended
	June 30						June 30
	2017			2016			2017			2016
Sales at fixed currency (millions)		$ 792.4			$ 762.8			$ 1,549.4			$ 1,534.4
Sales at public currency (millions)		797.4			771.1			1,555.3			1,538.4

Volume		6	%					3	%
Price changes		(1)	%					(1)	%
Acquisition adjusted fixed currency sales change		5	%					2	%
Acquisitions and divestitures		(1)	%					(1)	%
Fixed currency sales change		4	%					1	%
Foreign currency translation		(0)	%					0	%
Public currency sales change		3	%					1	%

Operating income at fixed currency (millions)		$ 73.4			$ 79.7			$ 146.4			$ 142.3
Operating income at public currency (millions)		74.4			80.3			147.6			143.1

Fixed currency operating income change		(8)	%					3	%
Fixed currency operating income margin		9.3	%		10.4	%		9.4	%		9.3	%
Acquisition adjusted fixed currency operating income change		(4)	%					7	%
Acquisition adjusted fixed currency operating income margin		9.2	%		10.0	%		9.3	%		8.9	%
Public currency operating income change		(7)	%					3	%

Percentages in the above table do not necessary sum due to rounding.

Net Sales

Fixed currency sales for Global Energy had a strong growth in the well stimulation business, while the production business showed a modest decline, impacted by continued lower price and customer product usage. Sales in our downstream rose modestly. Regionally, North America showed improvement, while our international regions showed some decline.

Operating Income

Fixed currency operating income and fixed currency operating income margins for Global Energy decreased during the second quarter and increased during the first six months of 2017. Acquisitions had a negative impact on the fixed currency operating income and minimal impact on the fixed currency operating income margins during the second quarter and first six months of 2017.

Acquisition adjusted fixed currency operating income margins for our Global Energy segment decreased 0.8 percentage points and increased 0.4 percentage points in the second quarter and first six months of 2017, respectively. Higher delivered product costs, which includes an unfavorable currency hedge impact when compared to the first six months of 2016, a rebuild of compensation reductions made in 2016 and reduced pricing negatively impacted margins by approximately 1.9 and 1.6 percentage points in the second quarter and first six months of 2017. Cost reduction actions favorably impacted the margins by approximately 1.1 and 2.5 percentage points for the respective periods.

Other


	Second Quarter Ended						Six Months Ended
	June 30						June 30
	2017			2016			2017			2016
Sales at fixed currency (millions)		$ 215.3			$ 202.2			$ 412.1			$ 388.9
Sales at public currency (millions)		216.2			205.1			413.1			393.5

Volume		5	%					4	%
Price changes		2	%					2	%
Acquisition adjusted fixed currency sales change		6	%					6	%
Acquisitions and divestitures		0	%					(0)	%
Fixed currency sales change		6	%					6	%
Foreign currency translation		(1)	%					(1)	%
Public currency sales change		5	%					5	%

Operating income at fixed currency (millions)		$ 37.0			$ 38.2			$ 66.9			$ 67.8
Operating income at public currency (millions)		37.1			38.9			67.1			69.0

Fixed currency operating income change		(3)	%					(1)	%
Fixed currency operating income margin		17.2	%		18.9	%		16.2	%		17.4	%
Acquisition adjusted fixed currency operating income change		(3)	%					(1)	%
Acquisition adjusted fixed currency operating income margin		17.2	%		18.9	%		16.2	%		17.4	%
Public currency operating income change		(5)	%					(3)	%

Percentages in the above table do not necessary sum due to rounding.

Net Sales

Fixed currency sales for Other increased in both the second quarter and first six months of 2017, driven by both volume and pricing gains. At a regional level, both the second quarter and first six months sales results showed good growth in North America.

At an operating segment level, Pest Elimination fixed currency sales increased 8% and 7% in the second quarter and first six months of 2017, respectively. Sales to food retail, hospitality, restaurant, and food processing customers led the growth. Equipment Care sales increased 2% and 3% in the second quarter and first six months of 2017, respectively. Slower new account acquisition impacted results.

Operating Income

Fixed currency operating income margins for Other segment decreased 1.7 and 1.2 percentage points during the second quarter and first six months of 2017. Field investments negatively impacted comparable margins by approximately 2.8 and 2.5 percentage points for the respective periods, which more than offset the favorable impact of sales volume and pricing increases which added approximately 1.1 and 1.3 percentage points.

Corporate

Consistent with our internal management reporting, Corporate amounts in the table on page 35 include intangible asset amortization specifically from the Nalco merger and special (gains) and charges that are not allocated to our reportable segments. Items included within special (gains) and charges are shown in the table on page 31.

FINANCIAL POSITION, CASH FLOWS AND LIQUIDITY

Financial Position

Total assets were $19.5 billion and $18.3 billion as of June 30, 2017 and December 31, 2016, respectively. The increase in assets was driven primarily by the impact of the Anios acquisition. Total liabilities were $12.5 billion as of June 30, 2017 and $11.4 billion as of December 31, 2016. Total debt was $7.7 billion as of June 30, 2017 and $6.7 billion as of December 31, 2016.

Our net debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”) and net debt to adjusted EBITDA are shown in the following table. EBITDA and adjusted EBITDA are non-GAAP measures, which are discussed further in the “Non-GAAP Financial Measures” section of this MD&A.

The inputs to EBITDA reflect the trailing twelve months of activity for the period presented.


	2017		2016
(ratio)
Net debt to EBITDA		2.6		2.8
Net debt to adjusted EBITDA		2.6		2.3

(millions)
Total debt		$ 7,679.9		$ 6,846.9
Cash		260.7		167.4
Net debt		$ 7,419.2		$ 6,679.5

Net income including non-controlling interest		$ 1,306.4		$ 968.6
Provision for income taxes		381.6		299.9
Interest expense, net		255.3		251.3
Depreciation		579.4		549.7
Amortization		291.6		295.4
EBITDA		2,814.3		2,364.9

Special (gains) and charges impacting EBITDA		80.0		504.8
Adjusted EBITDA		$ 2,894.3		$ 2,869.7

Cash Flows

Operating Activities


	Six Months Ended
	June 30
(millions)	2017		2016		Change
Cash provided by operating activities		$ 859.7		$ 874.8		$ (15.1)

Year-over-year comparability was negatively impacted primarily by a decrease in comparable pension contributions offset by an increase in comparable income tax payments and changes in working capital (accounts receivable, inventory and accounts payable) metrics. We continue to generate strong cash flow from operations which has allowed us to fund our ongoing operations, debt repayments, investments in the business, acquisitions and pension obligations, and return cash to shareholders through share repurchases and dividend payments.

Investing Activities


	Six Months Ended
	June 30
(millions)	2017		2016		Change
Cash used for investing activities		$ 1,150.1		$ (323.9)		$ 1,474.0

Year-over-year comparability in our investing activities was impacted primarily by the Anios acquisition in the first quarter of 2017. See Note 3 for further information. We also continue to make investments in our business, including capital expenditures.

Financing Activities


	Six Months Ended
	June 30
(millions)	2017		2016		Change
Cash provided by (used for) financing activities		$ 226.0		$ (477.2)		$ 703.2

During the first six months of 2017, we had net issuances of commercial paper and notes payable of $910 million. We repurchased $501 million of shares, including $300 million shares through an ASR program initiated in February 2017. Refer to Note 10 for further discussion on our ASRs. We also distributed $223 million of dividends.

During the first six months of 2016, we issued $400 million 2.00% and $400 million 3.25% senior notes and repaid the remaining $125 million of our term loan borrowings. We had net repayments of commercial paper and notes payable of $340 million. We repurchased $638 million of shares, including $300 million shares through an ASR program initiated in February 2016, and distributed $218 million of dividends.

Liquidity and Capital Resources

We currently expect to fund all of the cash requirements which are reasonably foreseeable for the next twelve months, including scheduled debt repayments, new investments in the business, share repurchases, dividend payments, possible business acquisitions and pension and postretirement contributions with cash from operating activities and additional short-term and/or long-term borrowings. We continue to expect our operating cash flow to remain strong.

As of June 30, 2017, we had $260.7 million of cash and cash equivalents on hand, of which $254.7 million was held outside of the U.S.

As of June 30, 2017, we had in place a $2.0 billion multi-year credit facility which expires in December 2019. The credit facility has been established with a diverse syndicate of banks and supports our $2.0 billion U.S. commercial paper program and our $2.0 billion Euro commercial paper program. The maximum aggregate amount of commercial paper that may be issued under our U.S. commercial paper program and our Euro commercial paper program may not exceed $2.0 billion. At the end of the second quarter of 2017, we had $581 million and $337 million (€300 million) in outstanding U.S. and Euro commercial paper, respectively with an average annual interest rate of 0.9%. As of June 30, 2017, both programs were rated A-2 by Standard & Poor’s and P-2 by Moody’s.

Our long-term debt issuance and repayment activity through the first six months of 2016 is discussed in the Cash Flows – Financing Activities section of this MD&A.

We are in compliance with our debt covenants and believe we have sufficient borrowing capacity to meet our foreseeable operating needs.

As of June 30, 2017, Standard & Poor’s and Moody’s rated our long-term credit at A- (stable outlook) and Baa1 (stable outlook), respectively.

The schedule of contractual obligations included in the Financial Position and Liquidity section of our Form 10-K for the year ended December 31, 2016 disclosed total notes payable and long-term debt due within one year of $0.5 billion. As of June 30, 2017, the total notes payable and long-term debt due within one year increased to $1.8 billion. The increase primarily reflected commercial paper borrowings during the first six months of 2017.

Our gross liability for uncertain tax positions was $78 million as of June 30, 2017 and $76 million as of December 31, 2016. We are not able to reasonably estimate the amount by which the liability will increase or decrease over time; however, at this time, we do not expect significant payments related to these obligations within the next year.

GLOBAL ECONOMIC ENVIRONMENT

Energy Markets

Approximately 23% of our sales are generated from our Global Energy segment, the results of which, as noted further below, are subject to volatility in the oil and gas commodity markets.

Oil industry activity has been gradually recovering from 2016’s lows during the first six months of 2017, with strong gains in drilling activity over the past year and recovering capital expenditure trends in 2017.

Global demand for oil and overall energy consumption has shown modest growth over this period. Oil prices have risen from their lows in early 2016.

Our global footprint and broad business portfolio within the Global Energy segment, as well as our strong execution capabilities are expected to provide the required resilience to outperform in the current market. As such, we continue to remain confident in the long-term growth prospects of the segment.

As petroleum derived materials are key inputs to many of our chemical products, lower oil prices will continue to provide benefits across our segments in the form of lower raw material costs.

Global Economies

Approximately half of our sales are outside of the U.S. Our international operations subject us to changes in economic conditions and foreign currency exchange rates as well as political uncertainty in some countries which could impact future operating results.

Brexit

On March 29, 2017, the United Kingdom (“U.K.”) government gave formal notice to the European Union (“EU”) to begin the process of negotiating the U.K.’s exit (“Brexit”) from the EU. The effects of Brexit will depend on any agreements the U.K. makes to retain access to the EU markets either during a transitional period or more permanently. The negotiations might also impact various tax reliefs and exemptions that apply to transactions between the U.K. and EU. In the longer term, any impact from Brexit on our U.K. operations will depend, in part, on the outcome of tariff, trade, regulatory, and other negotiations. We will continue to monitor the status of tax law changes and tax treaty negotiations at the U.K. and EU.

For the six months ended June 30, 2017, net sales of our U.K. operations were approximately 2% of our consolidated net sales.

NEW ACCOUNTING PRONOUNCEMENTS

For information on new accounting pronouncements, see Note 16 to the Consolidated Financial Statements.

NON-GAAP FINANCIAL MEASURES

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operation” in Item 2, contains financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S. (GAAP). These non-GAAP measures include:

Fixed currency sales

Acquisition adjusted fixed currency sales

Adjusted cost of sales

Adjusted gross margin

Fixed currency operating income

Fixed currency operating income margin

Adjusted operating income

Adjusted operating income margin

Adjusted fixed currency operating income

Adjusted fixed currency operating income margin

Acquisition adjusted fixed currency operating income

Acquisition adjusted fixed currency operating income margin

EBITDA

Adjusted EBITDA

Adjusted tax rate

Adjusted net income attributable to Ecolab

Adjusted diluted EPS

We provide these measures as additional information regarding our operating results. We use these non-GAAP measures internally to evaluate our performance and in making financial and operational decisions, including with respect to incentive compensation. We believe that our presentation of these measures provides investors with greater transparency with respect to our results of operations and that these measures are useful for period-to-period comparison of results.

Our non-GAAP financial measures for cost of sales, gross margin and operating income exclude the impact of special (gains) and charges, and our non-GAAP measures for tax rate, net income attributable to Ecolab and diluted EPS further exclude the impact of discrete tax items. We include items within special (gains) and charges and discrete tax items that we believe can significantly affect the period-over-period assessment of operating results and not necessarily reflect costs and/or income associated with historical trends and future results. After tax special (gains) and charges are derived by applying the applicable local jurisdictional tax rate to the corresponding pre-tax special (gains) and charges.

EBITDA is defined as the sum of net income including non-controlling interest, provision for income taxes, net interest expense, depreciation and amortization. Adjusted EBITDA is defined as the sum of EBITDA and special (gains) and charges impacting EBITDA. EBITDA and adjusted EBITDA are used as inputs to our net debt to EBITDA and net debt to adjusted EBITDA ratios. We view these ratios as important indicators of the operational and financial health of our organization.

We evaluate the performance of our international operations based on fixed currency rates of foreign exchange, which eliminate the translation impact of exchange rate fluctuations on our international results. Fixed currency amounts included in this Form 10-Q are based on translation into U.S. dollars at the fixed foreign currency exchange rates established by management at the beginning of 2017.

These non-GAAP measures are not in accordance with, or an alternative to U.S. GAAP, and may be different from non-GAAP measures used by other companies. Investors should not rely on any single financial measure when evaluating our business. We recommend that investors view these measures in conjunction with the U.S. GAAP measures included in this MD&A and we have provided reconciliations of reported U.S. GAAP amounts to the non-GAAP amounts.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include expectations concerning our payments and contributions to pension and postretirement health care benefit plans; tax deductibility of goodwill; amortization expense; share repurchases; the impact of new accounting pronouncements; the impact of lawsuits, claims and environmental matters; payments related to uncertain tax positions; timing of hedged transactions; timing and funding of restructuring cash expenditures; tax rate impact of special gains and charges and discrete tax items; excess tax benefits; timing and funding of restructuring cash expenditures; tax rate impact of special gains and charges and discrete tax items; excess tax benefits; borrowing capacity; impact of oil price fluctuations regarding sales, performance compared to market and future prospects; global foreign currency markets; global credit or market risk; future cash flow; cash requirements and sources of funding; nonperformance of financial counterparties; and doing business in Iran.

Without limiting the foregoing, words or phrases such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “we believe,” “we expect,” “estimate,” “project” (including the negative or variations thereof) or similar terminology, generally identify forward-looking statements. Forward-looking statements may also represent challenging goals for us. These statements, which represent our expectations or beliefs concerning various future events, are based on current expectations that involve a number of risks and uncertainties that could cause actual results to differ materially from those of such forward-looking statements. In particular, the ultimate results of any restructuring and business improvement actions, including cost synergies, depend on a number of factors, including the development of final plans, the impact of local regulatory requirements regarding employee terminations, the time necessary to develop and implement the restructuring and other business improvement initiatives and the level of success achieved through such actions in improving competitiveness, efficiency and effectiveness. We caution that undue reliance should not be placed on such forward-looking statements, which speak only as of the date made.

Some of the factors which could cause results to differ from those expressed in any forward-looking statements are set forth under Item 1A, entitled Risk Factors, of our Form 10-K for the year ended December 31, 2016, and include the vitality of the markets we serve including the impact of oil price fluctuations on the markets served by our Global Energy segment; the impact of economic factors such as the worldwide economy, capital flows, interest rates, foreign currency risk and reduced sales and earnings in our international operations resulting from the weakening of local currencies versus the U.S. dollar; our ability to attract and retain high caliber management talent to lead our business; our ability to execute key business initiatives; potential information technology infrastructure failures or breaches in data security; exposure to global economic, political and legal risks related to our international operations including with respect to our operations in Russia; the costs and effects of complying with laws and regulations, including those relating to the environment and to the manufacture, storage, distribution, sale and use of our products; the occurrence of litigation or claims, including related to the Deepwater Horizon oil spill; our ability to develop competitive advantages through innovation; difficulty in procuring raw materials or fluctuations in raw material costs; our substantial indebtedness; our ability to acquire complementary businesses and to effectively integrate such businesses; restraints on pricing flexibility due to contractual obligations; pressure on operations from consolidation of customers, vendors or competitors; public health epidemics; potential losses arising from the impairment of goodwill or other assets; potential loss of deferred tax assets; changes in tax law and unanticipated tax liabilities; potential chemical spill or release; potential class action lawsuits; the loss or insolvency of a major customer or distributor; acts of war or terrorism; natural or man-made disasters; water shortages; severe weather conditions; and other uncertainties or risks reported from time to time in our reports to the SEC. There can be no assurances that our earnings levels will meet investors’ expectations. Except as may be required under applicable law, we do not undertake, and expressly disclaim, any duty to update our Forward-Looking Statements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We use foreign currency forward contracts, interest rate swap agreements and foreign currency debt to manage risks associated with foreign currency exchange rates, interest rates and net investments in our foreign operations. We do not hold derivative financial instruments of a speculative nature or for trading purposes. For a more detailed discussion of derivative instruments, refer to Note 8, entitled “Derivatives and Hedging Transactions”, of the consolidated financial statements located under Part I, Item 1 of this quarterly report on Form 10-Q.

Item 4. Controls and Procedures

As of June 30, 2017, we carried out an evaluation, under the supervision and with the participation of our management, including the Chairman of the Board and Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based upon that evaluation, our Chairman of the Board and Chief Executive Officer and the Chief Financial Officer concluded that our disclosure controls and procedures are effective.

During the period January 1 through June 30, 2017, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

As previously reported, the Texas Commission on Environmental Quality (“TCEQ”) issued a Notice of Enforcement and Notice of Violation related to Ecolab’s facility in Fresno, TX on August 29, 2014, alleging violations of the facility’s air permits and various state and federal air laws, which was followed by the issuance of a draft consent decree to Ecolab on June 24, 2015. The Company subsequently signed an Agreed Order on May 2, 2016, which became effective upon approval by the TCEQ on May 4, 2017. The total administrative penalty imposed by the TCEQ under the Agreed Order was approximately $1.06 million. Of that amount, approximately $425,000 was paid by the company simultaneously with its execution of the Agreed Order in May 2016, approximately $425,000 was conditionally offset by the company’s completion of three supplemental environmental projects, which it completed in May 2017, and approximately $210,000 was deferred and will be waived contingent upon the company’s compliance with the terms of the Agreed Order, which requires the company’s completion of a number of technical requirements, including revisions to two permits.

Note 15, entitled “Commitments and Contingencies” located under Part I, Item 1 of this Form 10-Q is incorporated herein by reference.

Item 1A. Risk Factors

In our report on Form 10-K for the year ended December 31, 2016, filed with the Securities and Exchange Commission on February 24, 2017, we identify under Item 1A important factors which could affect our financial performance and could cause our actual results for future periods to differ materially from our anticipated results or other expectations, including those expressed in any forward-looking statements made in this Form 10-Q. See the section entitled Forward-Looking Statements located on page 43 of this Form 10-Q. We may also refer to such disclosure to identify factors that may cause results to differ from those expressed in other forward-looking statements made in oral presentations, including telephone conferences and/or webcasts open to the public.

The discussion below, which appeared in our report on Form 10-Q for the quarterly period ended March 31, 2017, provides updates and additions to the risk factors and should be read together with the full list of risk factors set forth in the aforementioned Form 10-K. There have been no further changes to our risk factors from those disclosed in the aforementioned reports.

Our business depends on our ability to comply with laws and governmental regulations, and we may be adversely affected by changes in laws and regulations .

Our business is subject to numerous laws and regulations relating to the environment, including evolving climate change standards, and to the manufacture, storage, distribution, sale and use of our products as well as to the conduct of our business generally, including employment and labor laws. Compliance with these laws and regulations exposes us to potential financial liability and increases our operating costs. Regulation of our products and operations continues to increase with more stringent standards, causing increased costs of operations and potential for liability if a violation occurs. The potential cost to us relating to environmental and product registration laws and regulations is uncertain due to factors such as the unknown magnitude and type of possible contamination and clean-up costs, the complexity and evolving nature of laws and regulations, and the timing and expense of compliance. Changes to current laws (including tax laws), regulations and policies could impose new restrictions, costs or prohibitions on our current practices which would adversely affect our consolidated results of operations, financial position or cash flows.

Our subsidiaries are defendants in pending lawsuits alleging negligence and injury resulting from the use of our COREXIT dispersant in response to the Deepwater Horizon oil spill, which could expose us to monetary damages or settlement costs.

Our subsidiaries were named as defendants in pending lawsuits alleging negligence and injury resulting from the use of our COREXIT dispersant in response to the Deepwater Horizon oil spill, which could expose us to monetary damages or settlement costs. On April 22, 2010, the deepwater drilling platform, the Deepwater Horizon, operated by a subsidiary of BP plc, sank in the Gulf of Mexico after a catastrophic explosion and fire that began on April 20, 2010. A massive oil spill resulted. Approximately one week following the incident, subsidiaries of BP plc, under the authorization of the responding federal agencies, formally requested our indirect subsidiary, Nalco Company, to supply large quantities of COREXIT 9500, a Nalco oil dispersant product listed on the U.S. EPA National Contingency Plan Product Schedule. Nalco Company responded immediately by providing available COREXIT and increasing production to supply the product to BP’s subsidiaries for use, as authorized and directed by agencies of the federal government.

Nalco Company and certain affiliates (collectively “Nalco”) were named as a defendant in a series of class action and individual plaintiff lawsuits arising from this event. The plaintiffs in these matters claimed damages under products liability, tort and other theories. Nalco was also named as a third party defendant in certain matters. Nalco was indemnified in these matters by another of the defendants.

These cases were administratively transferred to a judge in the United States District Court for the Eastern District of Louisiana with other related cases under In Re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010, Case No. 10-md-02179 (E.D. La.) (the “MDL”).

Nalco Company, the incident defendants and the other responder defendants have been named as third party defendants by Transocean Deepwater Drilling, Inc. and its affiliates (the “Transocean Entities”) (In re the Complaint and Petition of Triton Asset Leasing GmbH, et al, MDL No. 2179, Civil Action 10-2771). In April and May 2011, the Transocean Entities, Cameron International Corporation, Halliburton Energy Services, Inc., M-I L.L.C., Weatherford U.S., L.P. and Weatherford International, Inc. (collectively, the “Cross Claimants”) filed cross claims in MDL 2179 against Nalco Company and other unaffiliated cross defendants. The Cross Claimants generally allege, among other things, that if they are found liable for damages resulting from the Deepwater Horizon explosion, oil spill and/or spill response, they are entitled to indemnity or contribution from the cross defendants.

On November 28, 2012, the Federal Court in the MDL entered an order dismissing all claims against Nalco. Because claims remained pending against other defendants, the Court’s decision was not a “final judgment” for purposes of appeal. Plaintiffs will have 30 days after entry of final judgment to appeal the Court’s decision. We cannot predict whether there will be an appeal of the dismissal, the involvement we might have in these matters in the future or the potential for future litigation. However, if an appeal by plaintiffs in these lawsuits is brought and won, these suits could have a material adverse effect on our consolidated results of operations, financial position or cash flows.

In December 2012 and January 2013, the MDL court issued final orders approving two settlements between BP and Plaintiffs’ Class Counsel: (1) a proposed Medical Benefits Class Action Settlement; and (2) a proposed Economic and Property Damages Class Action Settlement. Pursuant to the proposed settlements, class members agree to release claims against BP and other released parties, including Nalco Company and its related entities.

Nalco was named in nine additional complaints in May 2016, and two additional complaints in April 2017, filed by individuals alleging, among other things, business and economic loss resulting from the Deepwater Horizon oil spill. The plaintiffs in these lawsuits are generally seeking awards of unspecified compensatory and punitive damages, and attorneys’ fees and costs. These actions have been consolidated in the MDL and we expect they will be dismissed pursuant to the Court’s November 28, 2012 order granting Nalco’s motion for summary judgment.

On February 22, 2017, the Federal Court in the MDL ordered that plaintiffs who had previously filed a claim and who had “opted out” of and not released their claims under the Medical Benefits Class Action Settlement either: (1) complete a sworn statement indicating, among other things, that they opted out of the Medical Benefits Class Action Settlement (to be completed by plaintiffs who previously filed an individual complaint); or (2) file an individual lawsuit attaching the sworn statement as an exhibit, by a deadline date set by the Court. The Court will then determine which plaintiffs are entitled to pursue their claims and the procedures for addressing those claims.

Nalco continues to sell the COREXIT oil dispersant product and could be exposed to future lawsuits from the use of such product. We cannot predict the potential for future litigation with respect to such sales. However, if one or more of such lawsuits are brought and won, these suits could have a material adverse impact on our financial results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(c)

Issuer Purchases of Equity Securities


			(c)	(d)
	(a)		Number of shares	Maximum number of
	Total	(b)	purchased as part	shares that may
	number of	Average price	of publicly	yet be purchased
	shares	paid per	announced plans	under the plans
Period	purchased(1)	share(2)	or programs(3)	or programs(3)
April 1-30, 2017	11,428	127.0622	-	14,222,229
May 1-31, 2017	623,491	127.3714	605,559	13,616,670
June 1-30, 2017	624,831	132.7605	616,499	13,000,171
Total	1,259,750	130.0416	1,222,058	13,000,171

(1)

Includes 37,692 shares reacquired from employees and/or directors as swaps for the cost of stock options, or shares surrendered to satisfy minimum statutory tax obligations under our stock incentive plans.

(2)

The average price paid per share includes brokerage commissions associated with publicly announced plan purchases plus the value of such other reacquired shares.

(3)

As announced on February 24, 2015, our Board of Directors authorized the repurchase of up to 20,000,000 shares. Subject to market conditions, we expect to repurchase all shares under the open authorizations, for which no expiration date has been established, in open market or privately negotiated transactions, including pursuant to Rule 10b5-1 and accelerated share repurchase programs.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Iran Threat Reduction and Syria Human Rights Act of 2012

Under the Iran Threat Reduction and Syria Human Rights Act of 2012, which added Section 13(r) of the Securities Exchange Act of 1934, the Company is required to disclose in its periodic reports if it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with entities or individuals designated pursuant to certain Executive Orders. Disclosure is required even where the activities are conducted outside the U.S. by non-U.S. affiliates in compliance with applicable law, and even if the activities are not covered or prohibited by U.S. law. In connection with the easing of certain sanctions by the United States against Iran in January 2016 and in compliance with the economic sanctions regulations administered by U.S. Treasury’s Office of Foreign Assets Control (OFAC) and U.S. export control laws, a wholly-owned non-U.S. subsidiary of the Company completed the following sales related to businesses in our Energy operating segment pursuant to and in compliance with the terms and conditions of OFAC’s General License H: sales of products used for process and water treatment applications in (i) upstream oil and gas production and (ii) petrochemical plants totaling $321,071 during the subsidiary’s second quarter ended May 31, 2017, and additional sales of such products totaling $379,000 during June 2017, were made to a distributor in Dubai and two distributors in Iran. Our non-U.S. subsidiary intends to continue doing business in Iran under General License H in compliance with U.S. economic sanctions and export control laws, which sales may require additional disclosure pursuant to the abovementioned statute.

Item 6. Exhibits

(a)

The following documents are filed as exhibits to this report:

(10.1a) Amended and Restated Dealer Agreement dated 9 June 2017 between Ecolab Inc., Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. (as Issuers), Ecolab Inc. (as Guarantor in respect of the notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.), Credit Suisse Securities (Europe) Limited (as Arranger), and Citibank Europe plc, UK Branch and Credit Suisse Securities (Europe) Limited (as Dealers).

(10.1b) Amended and Restated Note Agency Agreement dated 9 June 2017 between Ecolab Inc., Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. (as Issuers), Ecolab Inc. (as Guarantor in respect of the notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.), and Citibank, N.A., London Branch (as Issuer and Paying Agent).

(10.1c) Deed of Covenant made on 9 June 2017 by Ecolab Inc., Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. (as Issuers).

(10.1d) Deed of Guarantee made on 9 June 2017 by Ecolab Inc.

(10.2) Amendment No. 6 to the Ecolab Executive Death Benefits Plan, effective June 23, 2017 (incorporated by reference to Exhibit 10.1(vii) of Ecolab’s Form 8-K filed on June 23, 2017). (File No. 001-9328).

(15.1) Letter regarding unaudited interim financial information.

(31.1) Rule 13a - 14(a) CEO Certification.

(31.2) Rule 13a - 14(a) CFO Certification.

(32.1) Section 1350 CEO and CFO Certifications.

(101.1) Interactive Data File.

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.


	ECOLAB INC.


Date: August 3, 2017	By:	/s/ Bruno Lavandier
		Bruno Lavandier
		Senior Vice President and Corporate Controller
		(duly authorized officer and
		Chief Accounting Officer)

EXHIBIT INDEX


Exhibit No.	Document	Method of Filing
(10.1a)	Amended and Restated Dealer Agreement dated 9 June 2017 between Ecolab Inc., Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. (as Issuers), Ecolab Inc. (as Guarantor in respect of the notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.), Credit Suisse Securities (Europe) Limited (as Arranger), and Citibank Europe plc, UK Branch and Credit Suisse Securities (Europe) Limited (as Dealers).	Filed herewith electronically.

(10.1b)	Amended and Restated Note Agency Agreement dated 9 June 2017 between Ecolab Inc., Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. (as Issuers), Ecolab Inc. (as Guarantor in respect of the notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.), and Citibank, N.A., London Branch (as Issuer and Paying Agent).	Filed herewith electronically.

(10.1c)	Deed of Covenant made on 9 June 2017 by Ecolab Inc., Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. (as Issuers).	Filed herewith electronically.

(10.1d)	Deed of Guarantee made on 9 June 2017 by Ecolab Inc.	Filed herewith electronically.

(10.2)	Amendment No. 6 to the Ecolab Executive Death Benefits Plan, effective June 23, 2017 (incorporated by reference to Exhibit 10.1(vii) of Ecolab’s Form 8-K filed on June 23, 2017). (File No. 001-9328).	Incorporated by reference to Exhibit 10.1(vii) of Ecolab’s Form 8-K dated June 23, 2017

(15.1)	Letter regarding unaudited interim financial information.	Filed herewith electronically.

(31.1)	Rule 13a - 14(a) CEO Certification.	Filed herewith electronically.

(31.2)	Rule 13a - 14(a) CFO Certification.	Filed herewith electronically.

(32.1)	Section 1350 CEO and CFO Certifications.	Filed herewith electronically.

(101.1)	Interactive Data File.	Filed herewith electronically.


	CLIFFORD CHANCE LLP

Exhibit 10.1.A


		Execution Version



ECOLAB INC. ( incorporated under the laws of the State of Delaware ) ECOLAB LUX 1 S.À R.L. (a private limited liability company (société à responsibilité limitée) incorporated for an unlimited duration under the laws of the Grand Duchy of Luxembourg) ECOLAB LUX 2 S.À R.L. (a private limited liability company (société à responsibilité limitée) incorporated for an unlimited duration under the laws of the Grand Duchy of Luxembourg) ECOLAB NL 10 B.V. (a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands) ECOLAB NL 11 B.V. (a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands) as Issuers ECOLAB INC. ( incorporated under the laws of the State of Delaware ) ( as Guarantor in respect of the notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. ) CREDIT SUISSE SECURITIES (EUROPE) LIMITED as Arranger and CITIBANK EUROPE PLC, UK BRANCH CREDIT SUISSE SECURITIES (EUROPE) LIMITED as Dealers
	AMENDED AND RESTATED DEALER AGREEMENT RELATING TO A U.S.$2,000,000,000 EURO COMMERCIAL PAPER PROGRAMME

CONTENTS

1........................................................................................ INTERPRETATION 2

2.............................................................................................................................. ISSUE 5

3.................... REPRESENTATIONS AND WARRANTIES 7

4.......................................... COVENANTS AND AGREEMENTS 11

5.............................................................. CONDITIONS PRECEDENT 16

6...................................... TERMINATION AND APPOINTMENT 16

7.................................................................................................................. NOTICES 17

8.......................................................................... THIRD PARTY RIGHTS 17

9.................................................................. LAW AND JURISDICTION 18

10........................................................................................ COUNTERPARTS 19

Schedule 1 CONDITION PRECEDENT DOCUMENTS............................................................... 20

Schedule 2 SELLING RESTRICTIONS................................................................................... 22

Schedule 3 PROGRAMME SUMMARY................................................................................... 26

Schedule 4 INCREASE OF MAXIMUM AMOUNT..................................................................... 29

Schedule 5 APPOINTMENT OF NEW DEALER......................................................................... 31

Schedule 6 FORM OF CALCULATION AGENCY AGREEMENT................................................. 33

Clause

Page


1.	Interpretation	2
2.	Issue	5
3.	Representations and Warranties	7
4.	Covenants and Agreements	11
5.	Conditions Precedent	16
6.	Termination and Appointment	16
7.	Notices	17
8.	Third Party Rights	17
9.	Law and Jurisdiction	18
10.	Counterparts	19
Schedule 1 Condition Precedent Documents		20
Schedule 2 Selling Restrictions		22
Schedule 3 Programme Summary		26
Schedule 4 Increase of Maximum Amount		29
Schedule 5 Appointment of New Dealer		31
Schedule 6 Form of Calculation Agency Agreement		33

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THIS AGREEMENT is made on 9 June 2017

BETWEEN

(1)

(2)

ECOLAB LUX 1 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.319;

(3)

ECOLAB LUX 2 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.318;

(4)

ECOLAB NL 10 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56036094;

(5)

ECOLAB NL 11 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56150547,

(each of Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V is referred to herein as an " Issuer " and together, the " Issuers ");

(6)

ECOLAB INC. , a corporation organised and existing under the laws of the State of Delaware, having its registered office at 1209 Orange Street, City of Wilmington, Delaware, U.S.A., registered in the State of Delaware under number 0164814 (the " Guarantor ", in respect of Notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.);

(7)

CREDIT SUISSE SECURITIES (EUROPE) LIMITED (the " Arranger "); and

(8)

CITIBANK EUROPE PLC, UK BRANCH and CREDIT SUISSE SECURITIES (EUROPE) LIMITED as dealers for the Notes to be issued under the Programme (each a " Dealer " and together, the " Dealers ").

WHEREAS

(A)

Ecolab Inc., as Issuer and Guarantor, with certain other issuers and dealers named therein entered into an amended and restated dealer agreement dated 21 September 2016 (the " Original Agreement ") in relation to a euro-commercial paper programme.

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(B)

The parties hereto wish to further amend and restate the terms of the Original Agreement as set out hereunder.

IT IS AGREED as follows:

INTERPRETATION

1.1

Definitions

In this Agreement:

" Agency Agreement " means the amended and restated note agency agreement, dated the date hereof, between the Issuers, the Guarantor and the Issue and Paying Agent, providing for the issue of and payment on the Notes, as such agreement may be amended or supplemented from time to time.

" Agreements " means this Agreement (as amended or supplemented from time to time), any agreement reached pursuant to Clause ‎ 2.1, the Deed of Covenant and the Agency Agreement.

" Classic Global Note " means a Note in global form which specifies on its face that it is not a New Global Note, representing an issue of commercial paper of a like maturity.

" Dealer(s) " means the institution or institutions specified as a Dealer in the Programme Summary together with any additional institution or institutions appointed pursuant to Clause ‎ 6.20 but excluding any institution or institutions whose appointment has been terminated pursuant to Clause ‎ 6.19.

" Deed of Covenant " means the deed of covenant, dated the date hereof, executed by the Issuers in respect of Global Notes issued pursuant to the Agency Agreement, as such deed may be amended or supplemented from time to time.

" Definitive Note " means a Note in definitive form.

" Disclosure Documents " means, at any particular date, (a) the Information Memorandum, including all documents incorporated by reference therein and (b) any other document delivered by the Issuers or the Guarantor to the Dealer(s) which the Issuers or the Guarantor have expressly authorised to be distributed to actual or potential purchasers of Notes.

" Dollar Equivalent " means, on any day:

(a)

in relation to any Dollar Note, the nominal amount of such Note; and

(b)

in relation to any Note denominated or to be denominated in any other currency, the amount in Dollars which would be required to purchase the nominal amount of such Note as expressed in such other currency at the spot rate of exchange for the purchase of such other currency with Dollars quoted by the Issue and Paying Agent at or about 11.00 a.m. (London time) on such day.

" Dollars " and " U.S.$ " denote the lawful currency of the United States of America; and " Dollar Note " means a Note denominated in Dollars.

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" Euro ", " euro ", " EUR " and " € " denote the lawful currency introduced at the start of the third stage of European Economic and Monetary Union pursuant to the Treaty on the Functioning of the European Union, as amended from time to time; and " Euro Note " means a Note denominated in Euro.

" FSMA " means the Financial Services and Markets Act 2000.

" Global Note " means a New Global Note or a Classic Global Note.

" Guarantee " means the deed of guarantee, dated the date hereof, executed by the Guarantor in respect of the obligations of Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. under the Notes and the Deed of Covenant and, where the context so requires, the guarantee and indemnity contained in that deed.

“ ICSDs ” means Euroclear Bank S.A./N.V. and Clearsteam Banking S.A.

" Information Memorandum " means the most recent information memorandum, as the same may be amended or supplemented from time to time, containing information about the Issuers, the Guarantor and the Programme, the text of which has been prepared by or on behalf of the Issuers and the Guarantor for use by the Dealer(s) in connection with the transactions contemplated by this Agreement.

" Issue and Paying Agent " means Citibank, N.A., London Branch and any successor issue and paying agent appointed in accordance with the Agency Agreement.

" Japanese Yen " denotes the lawful currency of Japan.

" Loss " means any liability, damages, cost, loss or expense (including, without limitation, legal fees, costs and expenses and any value added tax thereon).

" New Global Note " means a Note in global form which specifies on its face that it is a New Global Note, representing an issue of commercial paper of a like maturity.

" Note " means a commercial paper note of an Issuer purchased or to be purchased by a Dealer under this Agreement, in bearer global or definitive form, substantially in the relevant form scheduled to the Agency Agreement or such other form(s) as may be agreed from time to time between the relevant Issuer, the Guarantor, the relevant Dealer(s) and the Issue and Paying Agent and, unless the context otherwise requires, includes the commercial paper notes represented by the Global Notes.

" Programme " means the Euro-commercial paper programme established by this Agreement.

" Programme Summary " means the summary of the particulars of the Programme as set out in ‎ Schedule 3, as such summary may be amended or superseded from time to time.

" Related Party " means, in respect of any person, any affiliate of that person or any officer, director, employee or agent of that person or any such affiliate or any person by whom any of them is controlled for the purposes of the Securities Act.

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" relevant jurisdiction " means any one or more of The Netherlands, the Grand Duchy of Luxembourg, the United Kingdom, the United States and any jurisdiction from or through which any payment under or in respect of any Note or any Agreement or the Guarantee may be made.

" Sanctions " means any economic or financial sanctions or embargoes and/or restrictive measures administered or imposed by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. State Department, any other agency of the U.S. government, the United Nations, the European Union or the United Kingdom.

" Securities Act " means the United States Securities Act of 1933, as amended.

" STEP Label " has the meaning set out in the STEP Convention.

" STEP Convention " means the Market Convention on Short-Term European Paper (STEP) dated 19 May 2015 as the same may be amended from time to time or any substitute paper or convention relating to STEP issued by ACI – The Financial Markets Association and the European Money Markets Institute or by the STEP Secretariat (as such term is defined in the STEP Convention).

" Sterling " and " £ " denote the lawful currency of the United Kingdom.

" Subsidiary " means, in respect of any person (the " first person ") at any particular time, any other person (the " second person "):

(a)

Control : whose affairs and policies the first person controls or has the power to control, whether by ownership of share capital, contract, the power to appoint or remove a majority of the members of the governing body of the second person or otherwise; or

(b)

Consolidation : whose financial statements are, in accordance with applicable law and generally accepted accounting principles, consolidated with those of the first person.

" Swiss Franc " denotes the lawful currency of Switzerland.

1.2 Programme Summary

Terms not expressly defined herein shall have the meanings set out in the Programme Summary.

1.3 Legislation

Any reference in this Agreement to any legislation (whether primary legislation or regulations or other subsidiary legislation made pursuant to primary legislation) shall be construed as a reference to such legislation as the same may have been, or may from time to time be, amended or re-enacted.

1.4 Clauses and Schedules

Any reference in this Agreement to a Clause, sub-clause or a Schedule is, unless otherwise stated, to a clause or sub-clause hereof or a schedule hereto.

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1.5 Headings

Headings and sub-headings are for ease of reference only and shall not affect the construction of this Agreement.

1.6 Amendment and Restatement

The Original Agreement shall be amended and restated on the terms of this Agreement. Any Notes issued on or after the date of this Agreement shall be issued pursuant to this Agreement. Subject to such amendment and restatement, the Original Agreement shall continue in full force and effect.

ISSUE

2.1

Basis of agreements to issue; uncommitted facility

Subject to the terms hereof, each Issuer may issue Notes to the Dealer(s) from time to time at such prices and upon such terms as the relevant Issuer and the relevant Dealer may agree, provided that each Issuer has, and shall have, no obligation to issue Notes to the Dealer(s), except as agreed, and each Dealer has, and shall have, no obligation to subscribe Notes from the Issuers, except as agreed. Each Issuer acknowledges that the Dealer(s) may resell Notes subscribed by such Dealer(s). The tenor of each Note shall not be less than the Minimum Term nor greater than the Maximum Term specified in the Programme Summary, calculated from the date of issue of such Note to the maturity date thereof. Each issue of Notes having the same issue date, maturity date, currency of denomination, yield and redemption basis will be represented by a Global Note or by Definitive Notes having the aggregate nominal amount of such issue as may be agreed between the relevant Issuer and the relevant Dealer.

2.2

Procedures

If an Issuer and any Dealer shall agree on the terms of the subscription of any Note by such Dealer (including agreement with respect to the issue date, maturity date, currency, denomination, yield, redemption basis, aggregate nominal amount and purchase price), then:

2.2.1

Instruction to Issue and Paying Agent : the relevant Issuer shall instruct the Issue and Paying Agent to issue such Note and deliver it in accordance with the terms of the Agency Agreement;

2.2.2

Payment of purchase price : the relevant Dealer shall subscribe such Note on the date of issue:

(a)

Euro Note : in the case of a Euro Note, by transfer of funds settled through the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET2) System to such account as the Issue and Paying Agent shall have specified for this purpose; or

(b)

Other Notes : in all other cases, by transfer of freely transferable same day funds in the relevant currency to such account of the Issue and Paying Agent at such bank in the principal domestic financial centre for

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such currency as the Issue and Paying Agent shall have specified for this purpose,

or, in each case, by such other form of transfer as may be agreed between the relevant Dealer and the relevant Issuer; and

2.2.3

Delivery Instructions : the relevant Dealer shall notify the Issue and Paying Agent and the relevant Issuer of the payment and delivery instructions applicable to such Note or Notes by telephone, fax or email, such notification to be received in sufficient time and in any event no later than 10.00 a.m. (London time) one Business Day prior to the proposed issue date (or such later time or date as may be agreed between the Issue and Paying Agent and the relevant Dealer) to enable the Issue and Paying Agent to deliver such Note or Notes as contemplated in the Agency Agreement (or, in the case of Definitive Notes, make the same available for collection) on its issue date.

2.3

Failure of agreed issuance

If for any reason (including, without limitation, the failure of the relevant trade) a Note agreed to be subscribed pursuant to Clause ‎2.1 is not to be issued, the relevant Issuer and the relevant Dealer shall immediately notify the Issue and Paying Agent thereof.

2.4

Issuance currencies

The parties acknowledge that Notes issued under the Programme may be denominated in Dollars, Euro, Japanese Yen, Sterling, Swiss Francs, or, subject as provided below, in any other currency. Any agreement reached pursuant to Clause ‎2.1 to sell and subscribe a Note denominated in a currency other than Dollars, Euro, Japanese Yen, Sterling and Swiss Francs shall be conditional upon:

2.4.1

Compliance : it being lawful and in compliance with all requirements of any relevant central bank and any other relevant fiscal, monetary, regulatory or other authority, for deposits to be made in such currency and for such Note to be issued, offered for sale, sold and delivered;

2.4.2

Convertibility : such other currency being freely transferable and freely convertible into Dollars; and

2.4.3

Amendments : any appropriate amendments which the relevant Dealer, the relevant Issuer, the Guarantor or the Issue and Paying Agent shall require having been made to this Agreement and/or the Agency Agreement.

2.5

Increase of Maximum Amount

The Issuers and the Guarantor may increase the Maximum Amount by giving at least ten days' notice by letter, substantially in the form set out in ‎Schedule 4, to each of the Dealer(s) and the Issue and Paying Agent. Such increase will not take effect until the Dealer(s) have received from the Issuers the documents listed in such letter or in ‎Schedule 1 (if required by the Dealer(s)), in each case in form and substance acceptable to each Dealer.

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2.6

Calculation Agent

If floating rate Notes are to be issued, the relevant Issuer will appoint either the relevant Dealer or the Issue and Paying Agent (subject to the consent of the relevant Dealer or the Issue and Paying Agent, as the case may be, thereto) or some other person (subject to the consent of the relevant Dealer and the Issue and Paying Agent to such person's appointment) to be the calculation agent in respect of such floating rate Notes and the following provisions shall apply:

2.6.1

Dealer : if a Dealer is to be the calculation agent, its appointment as such shall be on the terms of the form of agreement set out in ‎ Schedule 6, and each Dealer will be deemed to have entered into an agreement in such form for a particular calculation if it is named as calculation agent in the redemption calculation attached to or endorsed on the relevant Note;

2.6.2

Issue and Paying Agent : if the Issue and Paying Agent is to be the calculation agent, its appointment as such shall be on the terms set out in the Agency Agreement; and

2.6.3

Other Calculation Agent : if the person nominated by a Dealer or by the Issue and Paying Agent as calculation agent is not a Dealer, that person shall execute (if it has not already done so) an agreement substantially in the form of the agreement set out in ‎ Schedule 6 and the appointment of that person shall be on the terms of that agreement.

REPRESENTATIONS AND WARRANTIES

3.1

Representations and warranties

Each Issuer, in respect of itself and the Guarantor, in respect of itself, Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V., represents and warrants to each Dealer at the date of this Agreement, each date upon which the Maximum Amount is increased, each date upon which an agreement for the issue and subscription of Notes is made and each date upon which Notes are, or are to be, issued that:

3.1.1

Authorisation; valid, binding and enforceable : each of:

(a)

the update of the Programme and the execution, delivery and performance by the Issuers of the Agreements and the Notes;

(b)

the execution, delivery and performance by the Guarantor of this Agreement, the Agency Agreement and the Guarantee;

(c)

the entering into and performance by the relevant Issuer of any agreement for the sale of Notes reached pursuant to Clause ‎ 2.1; and

(d)

the issue and sale of the Notes by the relevant Issuer under the Agreements,

has been duly authorised by all necessary action and the same constitute or, in the case of Notes, will, when issued in accordance with the Agency Agreement,

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constitute, valid and binding obligations of the relevant Issuer and/or the Guarantor (as the case may be) enforceable against each of them in accordance with their respective terms (subject, as to enforceability, to bankruptcy, insolvency, reorganisation and similar laws of general applicability relating to or affecting creditors' rights and to general principles of equity);

3.1.2

Status : the obligations of each Issuer under each of the Agreements and the Notes and the obligations of the Guarantor under this Agreement, the Agency Agreement and the Guarantee will rank (other than in the case of obligations preferred by mandatory provisions of law) at least pari passu with all other present and future unsecured and unsubordinated indebtedness of each Issuer and the Guarantor (as the case may be);

3.1.3

Incorporation, capacity : each Issuer and the Guarantor is duly incorporated and validly existing under the laws of its jurisdiction of incorporation and:

(a)

the update of the Programme, the execution, delivery and performance by each Issuer of the Agreements and the Notes;

(b)

the execution, delivery and performance by the Guarantor of this Agreement, the Agency Agreement and the Guarantee;

(c)

the entering into and performance by the relevant Issuer of any agreement for the issue and subscription of Notes reached pursuant to Clause ‎ 2.1; and

(d)

the issue and sale of the Notes by the relevant Issuer under the Agreements,

will not infringe any of the provisions of the relevant Issuer's or the Guarantor's constituting documents and will not contravene any law, regulation, order or judgment to which the relevant Issuer or the Guarantor or any of its assets is subject nor result in the breach of any term of, or cause a default under, any instrument to which the relevant Issuer or the Guarantor is a party or by which it or any of its assets may be bound except for such breaches or defaults as could not reasonably be expected to be material in the context of this Agreement and the transactions contemplated hereby;

3.1.4

Approvals : all consents, authorisations, licences or approvals of and registrations and filings with any governmental or regulatory authority required in connection with the issue by each Issuer of Notes under the Agreements and the performance of each Issuer's obligations under the Agreements and the Notes, the issue by the Guarantor of the Guarantee and the performance by the Guarantor of its obligations under this Agreement, the Agency Agreement and the Guarantee have been obtained and are in full force and effect, and copies thereof have been supplied to the Dealer(s) except for such consents, authorisations, licences, approvals, registrations and filings as could not reasonably be expected to be material in the context of this Agreement and the transactions contemplated hereby;

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3.1.5

Disclosure : in the context of this Agreement and the transactions contemplated hereby, the information contained or incorporated by reference in the Disclosure Documents is true and accurate in all material respects and is not misleading in any material respect and there are no other facts in relation to the Issuers or the Guarantor or any Notes the omission of which makes, in the context of the issue of Notes, the Disclosure Documents as a whole or any such information contained or incorporated by reference therein misleading in any material respect;

3.1.6

Financial Statements : the audited consolidated financial statements and any interim financial statements (audited or unaudited) published subsequently thereto and any other financial statements of Ecolab Inc. (in its capacity as Issuer and Guarantor) on Form 8-K published subsequently thereto, and in each case filed with the SEC incorporated by reference in the Information Memorandum, present fairly and accurately the consolidated financial position of each Issuer, the Guarantor and their respective Subsidiaries as of the respective dates of such statements and the consolidated results of operations of the Issuers, the Guarantor and their respective Subsidiaries for the periods they cover or to which they relate and such financial statements have been prepared in accordance with the relevant laws of the United States, and with generally accepted accounting principles in the United States applied on a consistent basis throughout the periods involved (unless and to the extent otherwise stated therein);

3.1.7

No material adverse change, No litigation : since the date of the most recent audited consolidated financial statements of the Guarantor supplied to the Dealer(s) and, in relation to any date on which this warranty falls to be made after the date hereof, save as otherwise disclosed by any Disclosure Document subsequently delivered by the Guarantor to the Dealer(s):

(a)

there has been no adverse change in the business, financial or other condition of the Issuers or the Guarantor or their respective Subsidiaries, holding companies or affiliates; and

(b)

there is no litigation, arbitration or governmental proceeding pending or, to the knowledge of the Issuers or the Guarantor, threatened against or affecting the Issuers or the Guarantor or their respective Subsidiaries, holding companies or affiliates,

which in any case could reasonably be expected to be material in the context of this Agreement and the transactions contemplated hereby;

3.1.8

No default : none of the Issuers nor the Guarantor is in default in respect of payment of (i) any indebtedness under any Notes and (ii) any indebtedness for any other borrowed money or any other obligation having a similar commercial effect, in an aggregate amount greater than U.S.$150,000,000;

3.1.9

No ratings downgrade : there has been no downgrading, nor any notice to the Issuers or the Guarantor of any intended downgrading, in the rating accorded to the Issuers' or the Guarantor's short-term or long-term debt by Standard & Poor's Financial Services, LLC or Moody's Investors Service, Inc.;

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3.1.10

Taxation : subject to compliance with the terms of the Agreements, neither the Issuers nor the Guarantor are required by any law or regulation nor any relevant taxing authority in the United States, The Netherlands or the Grand Duchy of Luxembourg in force at the date of this Agreement to make any deduction or withholding from any payment due under the Notes, the Agency Agreement, the Deed of Covenant or the Guarantee for or on account of any income, registration, transfer or turnover taxes, customs or other duties or taxes of any kind;

3.1.11

Maximum Amount not exceeded : the outstanding principal amount of all Notes on the date of issue of any Note does not and will not exceed the Maximum Amount set out in the Programme Summary (as increased from time to time pursuant to Clause ‎ 2.5) and for this purpose the nominal amount of any Note denominated in any currency other than Dollars shall be taken as the Dollar Equivalent of such nominal amount as at the date of the agreement for the issue of such Note;

3.1.12

Investment Company : each Issuer and the Guarantor is not an investment company as defined in the United States Investment Company Act of 1940;

3.1.13

STEP Label: the Issuer meets the criteria and requirements that are necessary in order to be eligible to apply for the STEP Label;

3.1.14

Anti-Bribery : none of the Issuers, the Guarantor nor any of their respective Subsidiaries, nor, to the knowledge of the Issuers or the Guarantor, any director, officer, agent, employee or other person associated with or acting on behalf of the Issuers, the Guarantor or any of their respective Subsidiaries, has taken any action that would result in a material violation of any provision of any applicable anti-bribery or anti-corruption law, rule or regulation enacted in any jurisdiction;

3.1.15

Sanctions : none of the Issuers, the Guarantor nor any of their respective Subsidiaries nor, to the knowledge of each Issuer or the Guarantor, any director, officer, agent, employee or affiliate of the Issuers, the Guarantor or any of their respective Subsidiaries is currently the subject of any Sanctions or conducting business with any person, entity or country which is the subject of any Sanctions, except and only as permitted by applicable law; and

3.1.16

Money laundering laws : the operations of each Issuer, the Guarantor and their respective Subsidiaries are and have been conducted at all times in compliance with applicable financial record keeping and reporting requirements and money laundering statutes in the jurisdiction of the relevant Issuer or, as the case may be, the Guarantor and of all jurisdictions in which the Issuer, the Guarantor and their respective Subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any applicable governmental agency.

3.2

Notice of inaccuracy

If, prior to the time a Note is issued and delivered to or for the account of the relevant Dealer, an event occurs which would render any of the representations and warranties set out in Clause ‎3.7 immediately, or with the lapse of time, untrue or incorrect in any

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material respect, the relevant Issuer and the Guarantor (where applicable) will inform the relevant Dealer in writing as soon as practicable of the occurrence of such event. In either case, the relevant Dealer shall inform the relevant Issuer in writing without any undue delay whether it wishes to continue or discontinue the issuance and delivery of the respective Notes.

3.3

Notice of STEP Label withdrawal

If at any time and for any reason the STEP Label granted to the Issuer is withdrawn, the Issuer shall promptly inform the Dealers upon becoming aware of such withdrawal.

COVENANTS AND AGREEMENTS

4.1

Issuer and Guarantor

Each of the Issuers and the Guarantor jointly and severally covenants and agrees that:

4.1.1

Delivery of published information : whenever the Guarantor shall publish or make available to its shareholders or to the public (by filing with any regulatory authority, securities exchange or otherwise) any information which could reasonably be expected to be material in the context of this Agreement and the transactions contemplated hereby, the Guarantor shall notify the Dealer(s) as to the nature of such information, shall make a reasonable number of copies of such information available to the Dealer(s) upon request to permit distribution to investors and prospective investors and shall take such action as may be necessary to ensure that the representation and warranty contained in sub-clause ‎ 3.7.5 is true and accurate in all material respects on the dates contemplated by such sub-clause. Notwithstanding the foregoing, the Guarantor will satisfy its obligations to notify the Dealer(s) under this sub-clause ‎ 4.10.1 by maintaining an e-mail alert system affording the Dealer(s) the opportunity to register via the Guarantor's web site to receive notification of the Guarantor's news releases and filings with the SEC, and the Dealers agree to so register. The Guarantor will notify the Dealer(s) if the e-mail alert system is discontinued and, in such event, notices pursuant to this sub-clause ‎ 4.10.1 will be delivered in accordance with Clause ‎ 7.21 of this Agreement. Certain SEC Filings are available via electronic means including the Internet (http://www.sec.gov/cgi-bin/srch-edgar) and Bloomberg Business News.

4.1.2

Indemnity : each of the Issuers and the Guarantor jointly and severally undertakes to the Dealers that if the Dealer or any of the Dealer's Related Parties incurs any Loss arising out of:

(a)

the relevant Issuer's failure (other than, in the reasonable opinion of the Issuer, for technical reasons) to make due payment under the Notes; or

(b)

the Guarantor's failure to make due payment under the Guarantee; or

(c)

Notes not being issued for any reason (other than as a result of the failure of any Dealer to pay) after an agreement for the sale of such Notes has been made; or

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(d)

any breach or alleged breach of the representations, warranties, covenants or agreements made by the relevant Issuer or the Guarantor in this Agreement, or

(e)

any untrue statement or alleged untrue statement of any material fact contained in the Disclosure Documents or the omission or alleged omission to state therein a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading in any material respect unless, in the case of an alleged untrue statement or omission, the allegation is being made by any of the Dealer's Related Parties,

the Issuers or, as the case may be, the Guarantor shall pay to the Dealer on demand an amount equal to such Loss. The Dealer shall not have any duty or other obligation, whether as fiduciary or trustee for any of its Related Parties or otherwise, to recover any such payment or to account to any other person for any amounts paid to it under this Clause.

(f)

In case any allegation as described in sub ‑ paragraphs (4.1.2)(d) or (4.1.2)(e) above is made or any action is brought against any Dealer or any of the Dealer's Related Parties in respect of which recovery may be sought from the Issuer and/or the Guarantor, as the case may be, under this Clause 4.1, the relevant Dealer shall promptly notify the Issuer and/or the Guarantor, as the case may be, in writing but failure to do so will not relieve the Issuer or the Guarantor from any liability under this Agreement. If any such allegation is made, the parties agree to consult in good faith with respect to the nature of the allegation. Subject to paragraph (g) below, the Issuer or, as the case may be, the Guarantor may participate at its own expense in the defence of any action.

(g)

If it so elects within a reasonable time after receipt of the notice referred to in paragraph (f) above, the Issuer or, as the case may be, the Guarantor may, subject as provided below, assume the defence of the action with legal advisers chosen by it and approved by the relevant Dealer (such approval not to be unreasonably withheld or delayed). Notwithstanding any such election a Dealer or any of the Dealer's Related Parties may employ separate legal advisers reasonably acceptable to the Issuer and the Guarantor, and the Issuer or the Guarantor shall not be entitled to assume such defence and shall bear the reasonable fees and expenses of such separate legal advisers if:

(i)

the use of the legal advisers chosen by the Issuer or the Guarantor to represent the Dealer or any of the Dealer's Related Parties would present such legal advisers with a conflict of interest;

(ii)

the actual or potential defendants in, or targets of, any such action include both the Dealer or any of the Dealer's Related Parties and the Issuer or the Guarantor and the Dealer concludes that there may be legal defences available to it and/or other Relevant Parties which are different from or additional to those available to the Issuer or the Guarantor; or

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(iii)

the Issuer or the Guarantor has not employed legal advisers reasonably satisfactory to the Dealer to represent the Dealer or any of the Dealer's Related Parties within a reasonable time after notice of the institution of such action.

(h)

If the Issuer or, as the case may be, the Guarantor assumes the defence of the action, the Issuer or, as the case may be, the Guarantor shall not be liable for any fees and expenses of legal advisers of the Dealer or any of the Dealer's Related Parties incurred thereafter in connection with the action, except as stated in paragraph (g) above.

(i)

Neither the Issuer nor the Guarantor shall be liable in respect of any settlement of any action effected without its written consent, such consent not to be unreasonably withheld or delayed. Neither the Issuer nor the Guarantor shall, without the prior written consent of the Dealer (such consent not to be unreasonably withheld or delayed), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim or action in respect of which recovery may be sought (whether or not the Dealer or any of the Dealer's Related Parties is an actual or potential party to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each Dealer and any of the Dealer's Related Parties from all liability arising out of such claim or action and does not include a statement as to or an admission of fault, culpability or failure to act by or on behalf of a Dealer or any of the Dealer's Related Parties.

4.1.3

Expenses, stamp duties, amendments : each of the Issuers and the Guarantor will:

(a)

Arranger's expenses : pay, or reimburse the Arranger for, all reasonable out-of-pocket costs and expenses (including (i) an amount equal to any United Kingdom value added tax but only to the extent the Arranger, or any other member of the group to which the Arranger belongs for value added tax purposes, reasonably determines that it is not entitled to recover (whether by credit or repayment) such value added tax and (ii) fees and disbursements of counsel to such Arranger) incurred by the Arranger in connection with the preparation, negotiation, printing, execution and delivery of this Agreement and all documents contemplated by this Agreement;

(b)

Dealers' expenses : pay, or reimburse each Dealer for, all reasonable out-of-pocket costs and expenses (including (i) an amount equal to any United Kingdom value added tax but only to the extent the relevant Dealer, or any other member of the group to which that Dealer belongs for value added tax purposes, reasonably determines that it is not entitled to recover (whether by credit or repayment) such value added tax and (ii) fees and disbursements of counsel to such Dealer) incurred by such Dealer in connection with the enforcement or protection of its rights under this Agreement;

(c)

Stamp duties : pay all stamp, registration and other similar taxes and duties (including any interest and penalties thereon or in connection

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therewith) which may be payable upon or in connection with the creation and issue of the Notes and the execution, delivery and performance of the Agreements and the Guarantee, except for any taxes payable regarding Luxembourg registration duties ( droits d'enregistrement ) due to a registration, submission or filing of the Agreements and the Guarantee where such registration, submission or filing is or was not required to maintain or preserve the rights of the Dealers under the Agreements and the Guarantee, and the Issuers shall jointly and severally indemnify each Dealer against any claim, demand, action, liability, damages, cost, loss or expense (including (i) an amount equal to any United Kingdom value added tax but only to the extent the relevant Dealer, or any other member of the group to which that Dealer belongs for value added tax purposes, reasonably determines that it is not entitled to recover (whether by credit or repayment) such value added tax and (ii) fees and disbursements of counsel to such Dealer) which it may incur as a result or arising out of or in relation to any failure to pay or delay in paying any of the same;

(d)

Amendments : notify each Dealer of any change in the identity of or the offices of the Issue and Paying Agent and any material change or amendment to or termination of the Agency Agreement or the Deed of Covenant or the Guarantee not later than five days prior to the making of any such change or amendment or such termination; and it will not permit to become effective any such change, amendment or termination which could reasonably be expected to affect adversely the interests of any Dealer or the holder of any Notes then outstanding;

4.1.4

No deposit-taking : the relevant Issuer will issue the Notes only if the following conditions apply (or the Notes can otherwise be issued without contravention of section 19 of the FSMA):

(a)

Selling restrictions : each relevant Dealer represents, warrants and agrees in the terms set out in Clause 3.1 of ‎ Schedule 2; and

(b)

Redemption value : the redemption value of each Note is not less than £100,000 (or an amount of equivalent value denominated wholly or partly in a currency other than Sterling), and no part of any Note may be transferred unless the redemption value of that part is not less than £100,000 (or such an equivalent amount); and

4.1.5

Sanctions : the Issuers and the Guarantor will each ensure that proceeds raised in connection with the issue of any Notes will not directly or indirectly be lent, contributed or otherwise made available to any person or entity (whether or not related to any Issuer or the Guarantor) for the purpose of financing the activities of any person or entity or for the benefit of any country currently the subject of any Sanctions, except and only as permitted by applicable law.

4.2

Compliance

The Issuers and the Guarantor shall take such steps (in conjunction with the Dealer(s), where appropriate) to ensure that any laws and regulations or requirements of any

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governmental agency, authority or institution which may from time to time be applicable to any Note shall be fully observed and complied with and in particular (but without limitation):

4.2.1

Regulation S : that neither the Issuers, the Guarantor, nor any of their affiliates nor any person acting on their or their affiliates behalf have engaged or will engage in any directed selling efforts with respect to the Notes, and they and their affiliates have complied and will comply with the offering restrictions requirement of Regulation S. Terms used in this sub-clause have the meanings given to them by Regulation S under the Securities Act.

4.3

Selling restrictions

Each Dealer represents, covenants and agrees that it has complied with and will comply with the selling restrictions set out in ‎Schedule 2, and that the representations contained therein are true and correct. Subject to compliance with those restrictions, each Dealer is hereby authorised by each of the Issuers and the Guarantor to circulate the Disclosure Documents to purchasers or potential purchasers of the Notes.

4.4

Dealers' obligations several

The obligations of each Dealer contained in this Agreement are several.

4.5

Status of Arranger

Each of the Dealers agrees that the Arranger has only acted in an administrative capacity to facilitate the establishment and/or maintenance of the Programme and has no responsibility to it for (a) the adequacy, accuracy, completeness or reasonableness of any representation, warranty, undertaking, agreement, statement or information in the Information Memorandum, this Agreement or any information provided in connection with the Programme or (b) the nature and suitability to it of all legal, tax and accounting matters and all documentation in connection with the Programme or any issue of Notes thereunder.

4.6

Issuers' compliance

The Guarantor shall procure that the Issuers shall comply with and discharge their respective obligations under each of the Agreements and the Notes.

4.7

STEP Label

The Issuers, failing which the Guarantor, will take all reasonable steps as may be necessary to apply for and maintain the STEP Label, including, for the avoidance of doubt:

4.7.1

submitting such application form and declaration of adherence to the STEP Market Convention as may be required from time to time by the STEP Convention;

4.7.2

authorising the eligible data provider (as defined in the STEP Convention) and the STEP Secretariat to receive, process and transmit to the to the European

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Central Bank (" ECB ") all data required from time to time under the STEP Convention;

4.7.3

ensuring that the eligible data provider (as defined in the STEP Convention) receives all such necessary information to be communicated to the ECB regarding the trades transacted under the Programme; and

4.7.4

ensuring that the Information Memorandum contains all such information as may be required from time to time by the STEP Convention and updating the Information Memorandum at least every 3 years or at such other times as may be specified by the STEP Convention and re-submitting it to the STEP Secretariat.

CONDITIONS PRECEDENT

5.1

Conditions precedent to first issue

The relevant Issuer and the Guarantor agrees to deliver to each Dealer, prior to the first issue of Notes to that Dealer, each of the documents set out in ‎Schedule 1 in form, substance and number reasonably requested by the relevant Dealer.

5.2

Conditions precedent to each issue

In relation to each issue of Notes, it shall be a condition precedent to the purchase thereof by any Dealer that (a) the representations and warranties in Clause ‎3.7 shall be true and correct in all material respects on each date upon which an agreement for the sale of Notes is made hereunder and on the date on which such Notes are issued and that (b) there is no other material breach of any of the obligations of the relevant Issuer or the Guarantor or either of them under any of the Agreements, the Notes or the Guarantee and that (c) the Dealer having received (in a form satisfactory to the Dealer) a duly executed or a conformed copy of the agreement between the relevant Issuer and the ICSDs with respect to the settlement in the ICSDs of New Global Notes.

TERMINATION AND APPOINTMENT

6.1

Termination

The Issuers may terminate the appointment of any Dealer, and any Dealer may resign, on not less than ten days' written notice to the relevant Dealer or the Issuers, as the case may be. The Issuers shall promptly inform the other Dealer(s), the Guarantor and the Issue and Paying Agent of any such termination or resignation. The rights and obligations of each party hereto shall not terminate in respect of any rights or obligations accrued or incurred before the date on which such termination takes effect and the provisions of sub-clause ‎4.10.2 and ‎4.10.3 shall survive termination of this Agreement and delivery against payment for any of the Notes.

6.2

Additional Dealers

Nothing in this Agreement shall prevent the Issuers from appointing one or more additional Dealers upon the terms of this Agreement provided that any additional Dealer shall have first confirmed acceptance of its appointment upon such terms in writing to the Issuers in substantially the form of the letter set out in ‎Schedule 5,

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whereupon it shall become a party to this Agreement vested with all the authority, rights, powers, duties and obligations as if originally named as a Dealer hereunder. The Issuers shall promptly inform the other Dealer(s), the Guarantor and the Issue and Paying Agent of any such appointment. The Issuers and the Guarantor hereby agrees to supply to such additional Dealer, upon such appointment, such legal opinions as are specified in paragraph ‎6 of ‎Schedule 1, if requested, or reliance letters in respect thereof.

NOTICES

7.1

Addressee for notices

All notices and other communications hereunder shall, save as otherwise provided in this Agreement, be made in writing and in English (by letter, fax or email) and shall be sent to the intended recipient at the address, fax number or email address and marked for the attention of the person (if any) from time to time designated by that party to the other parties hereto for such purpose. The initial address, fax number and email address so designated by each party are set out in the Programme Summary.

7.2

Effectiveness

Any communication from any party to any other under this Agreement shall be effective upon receipt by the addressee, provided that any such notice or other communication which would otherwise take effect after 4.00 p.m. on any particular day shall not take effect until 10.00 a.m. on the immediately succeeding business day in the place of the addressee.

7.3

Assignment

If, at any time, any Dealer shall transfer all or substantially all of its euro-commercial paper business to any affiliate then, on the date such transfer becomes effective, such affiliate shall become the successor to the relevant Dealer under this Agreement without the execution or filing of any paper or any further act on the part of the parties hereto so that the Issuers and the Guarantor and such affiliate shall acquire and become subject to the same rights and obligations between themselves as if they had entered into an agreement in the form (the relevant changes having been made) of this Agreement. After the said effective date all references in this Agreement to the relevant Dealer shall be deemed to be references to such affiliate. The relevant Dealer shall, as soon as reasonably practicable, give notice of any such transfer to the Issuers. In this Clause ‎ 7.23, " affiliate " means, in relation to any person, any entity controlled, directly or indirectly, by such person, any entity that controls, directly or indirectly, such person, or any entity under common control with such person. For this purpose "control" of any entity or person means ownership of a majority of the voting power of the entity or person.

THIRD PARTY RIGHTS

A person who is not a party to this Agreement has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement, but this does not affect any right or remedy of a third party which exists or is available apart from that Act.

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LAW AND JURISDICTION

9.1

Governing law

This Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.

9.2

English courts

The courts of England have exclusive jurisdiction to settle any dispute (a " Dispute "), arising from or connected with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement or any non-contractual obligation arising out of or in connection with this Agreement) or the consequences of its nullity.

9.3

Appropriate forum

The parties agree that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that they will not argue to the contrary.

9.4

Rights of the Dealers to take proceedings outside England

Clause ‎9.25 ( English courts ) is for the benefit of the Dealers only. As a result, nothing in this Clause ‎9 ( Law and jurisdiction ) prevents the Dealers from taking proceedings relating to a Dispute (" Proceedings ") in any other courts with jurisdiction. To the extent allowed by law, the Dealers may take concurrent Proceedings in any number of jurisdictions.

9.5

Process agent

Each Issuer and the Guarantor agrees that the documents which start any Proceedings and any other documents required to be served in relation to those Proceedings may be served on it by being delivered to Ecolab Limited at P.O Box 11, Winnington Avenue, Northwich, Cheshire, United Kingdom CW8 4DX or, if different, its registered office for the time being or at any address of the relevant Issuer or the Guarantor in Great Britain at which process may be served on it in accordance with The Companies Act 2006. If such person is not or ceases to be effectively appointed to accept service of process on behalf of the Issuers and the Guarantor, the Issuers and the Guarantor shall, on the written demand of any Dealer addressed and delivered to the Issuers and the Guarantor appoint a further person in England to accept service of process on its behalf and, failing such appointment within 15 days, any Dealer shall be entitled to appoint such a person by written notice addressed to the Issuers and the Guarantor and delivered to the Issuers and the Guarantor. Nothing in this paragraph shall affect the right of any Dealer to serve process in any other manner permitted by law. This clause applies to Proceedings in England and to Proceedings elsewhere.

9.6

Ecolab NL 10 B.V. and Ecolab NL 11 B.V.

If Ecolab NL 10 B.V. or Ecolab NL 11 B.V. are represented by an attorney or attorneys in connection with the signing and/or execution and/or delivery of this Agreement or any agreement or document referred to herein or made pursuant hereto and the relevant power or powers of attorney is or are expressed to be governed by the laws of The Netherlands, it is hereby expressly acknowledged and accepted by the other parties

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hereto that such laws shall govern the existence and extent of such attorney's or attorneys' authority and the effects of the exercise thereof.

10.

COUNTERPARTS

This Agreement may be signed in any number of counterparts, all of which when taken together shall constitute a single agreement.

AS WITNESS the hands of the duly authorised representatives of the parties hereto the day and year first before written.

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Schedule 1
CONDITION PRECEDENT DOCUMENTS

Certified copies of the Issuers' and the Guarantor's constituting documents, together with English translations, where required.

Certified copies of all documents evidencing the internal authorisations and approvals required to be granted by the Issuers and the Guarantor in connection with the Programme, together with English translations, where required.

Certified copies of any governmental or other consents and any filings required in connection with the Programme, together with English translations, where required.

Duly executed copies of:

(a)

the Dealer Agreement;

(b)

the Agency Agreement;

(c)

the Deed of Covenant; and

(d)

the Guarantee.

Copies of:

(a)

the confirmation of acceptance of appointment from the agent for service of process; and

(b)

confirmation that the Deed of Covenant and the Deed of Guarantee have been delivered to the Issue and Paying Agent.

Legal opinions from:

(a)

the Senior SEC Counsel and Assistant Secretary of Ecolab Inc. as to its due incorporation and the due authorisation and execution of the Agreements in its capacities as both Issuer and Guarantor;

(b)

Clifford Chance LLP as to the laws of the Grand Duchy of Luxembourg in respect of Ecolab Lux 1 S.à r.l. and Ecolab Lux 2 S.à r.l. and The Netherlands in respect of Ecolab NL 10 B.V. and Ecolab NL 11 B.V. respectively; and

(c)

Clifford Chance LLP as to the laws of England.

The Information Memorandum.

A list of the names, titles and specimen signatures of the persons authorised:

(a)

to sign on behalf of the Issuers and the Guarantor this Agreement, the Deed of Covenant, the Agency Agreement, the Notes and the Guarantee (as applicable);

(b)

to sign on behalf of the Issuers and the Guarantor all notices and other documents to be delivered in connection therewith; and

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(c)

to take any other action on behalf of the Issuers and the Guarantor in relation to the Programme.

Confirmation from the Issuers or the Issue and Paying Agent that the relevant forms of Global Note have been prepared and the same delivered to the Issue and Paying Agent.

10.

Confirmation that the Programme was granted the STEP Label.

11.

A duly executed copy of the authorisation from the Issuer to each ICSD, to effectuate any New Global Notes issued under the Programme and delivered by, or on behalf of, the Issuer to that ICSD.

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Schedule 2
SELLING RESTRICTIONS

General

By its purchase and acceptance of Notes issued under this Agreement, each Dealer represents, warrants and agrees that it will observe all applicable laws and regulations in any jurisdiction in which it may offer, sell or deliver Notes; and that it will not directly or indirectly offer, sell, resell, re-offer or deliver Notes or distribute any Disclosure Document, circular, advertisement or other offering material in any country or jurisdiction except under circumstances that will result in compliance with all applicable laws and regulations.

The United States of America

The Notes and the Guarantee have not been and will not be registered under the Securities Act and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons except in accordance with Regulation S. Each Dealer has represented and agreed (and each further Dealer appointed under the Programme will be required to represent and agree) that it has not offered, sold or delivered, and will not offer, sell or deliver, any Notes and the Guarantee constituting part of its allotment within the United States except in accordance with Rule 903 of Regulation S.

Each Dealer has also represented and agreed (and each further Dealer appointed under the Programme will be required to represent and agree) that it has offered, sold or delivered the Notes, and will offer, sell or deliver the Notes and the Guarantee (i) as part of their distribution at any time and (ii) otherwise until 40 days after the later of the commencement of the offering and the closing date (the "distribution compliance period"), only in accordance with Rule 903 of Regulation S.

Each Dealer has also agreed (and each further Dealer appointed under the Programme will be required to agree) that, at or prior to confirmation of sale of Notes and the Guarantee, it will have sent to each distributor, dealer or person receiving a selling concession, fee or other remuneration that purchases Notes and the Guarantee from it during the distribution compliance period a confirmation or notice to substantially the following effect:

"The Securities covered hereby have not been registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") and may not be offered, sold or delivered within the United States or to, or for the account or benefit of, U.S. persons (i) as part of their distribution at any time or (ii) otherwise until 40 days after the later of the commencement of the offering and the closing date, except in either case in accordance with Regulation S under the Securities Act. Terms used above have the meanings given to them by Regulation S."

Each Dealer has represented and agreed (and each further Dealer appointed under the Programme will be required to represent and agree) that neither it, nor its affiliates nor any persons acting on its or their behalf have engaged or will engage in any directed selling efforts with respect to the Notes and the Guarantee, and that it and they have complied and will comply with the offering restrictions requirement of Regulation S.

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Terms used above have the meanings given to them by Regulation S.

The United Kingdom

3.1

In relation to each issue of Notes, the Dealer purchasing such Notes represents, warrants and undertakes to the relevant Issuer and the Guarantor (where appropriate) that:

3.1.1 it is a person whose ordinary activities involve it in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of its business; and

3.1.2 it has not offered or sold and will not offer or sell any Notes other than to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their businesses or who it is reasonable to expect will acquire, hold, manage or dispose of investments (as principal or agent) for the purposes of their businesses where the issue of the Notes would otherwise constitute a contravention of section 19 of the Financial Services and Markets Act 2000 (the " FSMA ") by the relevant Issuer or the Guarantor;

3.2

it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) received by it in connection with the issue or sale of any Notes in circumstances in which section 21(1) of the FSMA does not apply to the relevant Issuer or the Guarantor; and

3.3

it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to any Notes in, from or otherwise involving the United Kingdom.

Japan

The Notes have not been and will not be registered under the Financial Instruments and Exchange Act of Japan (Act No. 25 of 1948, as amended; the " FIEA "). Accordingly, each Dealer represents and agrees that it has not, directly or indirectly, offered or sold and will not, directly or indirectly, offer or sell any Notes in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organised under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to, or for the benefit of, a resident of Japan except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the FIEA and any other applicable laws, regulations and ministerial guidelines of Japan.

5. Switzerland

Each Dealer acknowledges and agrees that (i) the Notes may not be publicly offered, sold or advertised, directly or indirectly, in or from Switzerland, (ii) neither the Information Memorandum nor any other offering or marketing material relating to the Notes constitutes a prospectus as such term is understood pursuant to article 652a or article 1156 of the Swiss Federal Code of Obligations and (iii) neither the Information

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Memorandum nor any other offering or marketing material relating to the Notes may be publicly distributed or otherwise made publicly available in Switzerland.

The Netherlands

Zero Coupon Notes in definitive form may only be transferred and accepted, directly or indirectly, within, from or into The Netherlands through the mediation of either the Issuer or a member firm of Euronext Amsterdam N.V. admitted in a function on one or more of the markets or systems operated by Euronext Amsterdam N.V. ( toegelaten instelling ) in full compliance with the Dutch Savings Certificates Act ( Wet inzake spaarbewijzen ) of 21 May 1985 (as amended) and its implementing regulations and must either be:

(a)

between individuals or legal entities who or which trade or invest in securities in the conduct of a profession or trade (which includes banks, dealers, insurance companies, pension funds, other institutional investors and commercial enterprises which regularly, as an ancillary activity, invest in securities); or, in any other case

(b)

recorded in a transaction note which includes the name and address of each party to the transaction, the nature of the transaction and the details and serial number of such Note.

No such mediation is required: (a) in respect of the transfer and acceptance of rights representing an interest in a Zero Coupon Note in global form, or (b) in respect of the initial issue of Zero Coupon Notes in definitive form to the first holders thereof, or (c) in respect of the transfer and acceptance of Zero Coupon Notes in definitive form between individuals not acting in the conduct of a business or profession, or (d) in respect of the transfer and acceptance of such Zero Coupon Notes within, from or into The Netherlands if all Zero Coupon Notes (either in definitive form or as rights representing an interest in a Zero Coupon Note in global form) of any particular Series or Tranche are issued outside The Netherlands and are not distributed into The Netherlands in the course of initial distribution or immediately thereafter.

In the event that the Savings Certificates Act applies, certain identification requirements in relation to the issue and transfer of, and payments on, Zero Coupon Notes have to be complied with.

As used herein, " Zero Coupon Notes " has the meaning given to it in Section 1(a) of the Dutch Savings Certificates Act ( Wet inzake spaarbewijzen ) of 21 May 1985 (as amended), being Notes that are in bearer form and that constitute a claim for a fixed sum against the Issuer and on which interest does not become due during their tenor or on which no interest is due whatsoever.

Grand Duchy of Luxembourg

The Notes may not be offered or sold to the public within the territory of the Grand Duchy of Luxembourg unless:

(a)

a prospectus has been duly approved by the Commission de Surveillance du Secteur Financier (the "CSSF") pursuant to part II or, as the case may be, part

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III of the Luxembourg law dated 10 July 2005 on prospectuses for securities, as amended (the " Luxembourg Prospectus Law "), implementing Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 on the prospectus to be published when securities are offered to the public or admitted to trading, as amended through Directive 2010/73/EU of the European Parliament and of the Council of 24 November 2010, as amended (the " Prospectus Directive "), if Luxembourg is the home Member State as defined under the Luxembourg Prospectus Law; or

(b)

if Luxembourg is not the home Member State, the CSSF and the European Securities and Markets Authority have been provided by the competent authority in the home Member State with a certificate of approval attesting that a prospectus in relation to the Notes has been drawn up in accordance with the Prospectus Directive and with a copy of the said prospectus; or

(c)

the offer of the Notes benefits from an exemption from or constitutes a transaction not subject to, the requirements to publish a prospectus pursuant to the Luxembourg Prospectus Law.

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Schedule 3
PROGRAMME SUMMARY


Issuer/Guarantor		Issuer 2
Ecolab Inc.		Ecolab Lux 1 S.à r.l.
Address:	1 Ecolab Place, St. Paul, MN 55102, U.S.A.	Address:			6, rue Eugène Ruppert, L-2453 Luxembourg, Grand Duchy of Luxembourg
Telephone:	+ 1 800 232 6522	Telephone:			+ 352 26 449 379
Fax:	+ 1 651 250 2573	Fax:			+ 352 26 449 167
Contact:	General Counsel	Contact:			Manager
					(cc. Ecolab Inc. as specified above)
Issuer 3			Issuer 4
Ecolab Lux 2 S.à r.l.			Ecolab NL 10 B.V.
Address:	6, rue Eugène Ruppert, L-2453 Luxembourg, Grand Duchy of Luxembourg		Address:	Iepenhoeve 7 A 3438MR Nieuwegein The Netherlands
Telephone:	+ 352 26 449 379		Telephone:	+31 30 6082372
Fax:	+ 352 26 449 167		Fax:	+31 30 6082228
Contact:	Manager		Contact:	Director
	(cc. Ecolab Inc. as specified above)			(cc. Ecolab Inc. as specified above)
Issuer 5
Ecolab NL 11 B.V.
Address:	Iepenhoeve 7 A 3438MR Nieuwegein The Netherlands
Telephone:	+31 30 6082222
Fax:	+31 30 6082228
Contact:	Director
	(cc. Ecolab Inc. as specified above)

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Dealer and Arranger
Credit Suisse Securities (Europe) Limited
Address:	One Cabot Square
	London E14 4QJ
Telephone:	+ 44 20 7888 9968
Fax:	+ 44 20 7905 6132
Contact:	Commercial Paper Desk
Dealer
Citibank Europe plc, UK Branch
Address:	Citigroup Centre
	Canada Square
	Canary Wharf
	London E14 5LB
Telephone:	+ 44 20 7986 9070
Fax:	+ 44 20 7986 6837
Contact:	Short Term Fixed Income Desk
Issue and Paying Agent
Citibank, N.A., London Branch
Address:	Citigroup Centre
	Canada Square
	Canary Wharf
	London E14 5LB
Telephone:	+353 1 622 2238
Fax:	+353 1 622 4029
Contact:	ECP Issuance Desk
Maximum Amount:	Denominations:
U.S.$2,000,000,000	EUR 100,000
(provided that the aggregate borrowing under Ecolab Inc.'s U.S.$ Commercial paper programme and the Programme may not exceed U.S.$2,000,000,000)	(or other conventionally accepted Denominations in other currencies, provided that the Euro Equivalent of any Note must be at least EUR 100,000 on the issue date).

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Governing Law:				Form of Notes:
Agreements: Notes:	English English			The Notes will be in bearer form. The Notes will initially be in global form (" Global Notes "). A Global Note will be exchangeable into definitive notes (" Definitive Notes ") only in the circumstances set out in that Global Note (and as summarised below).
				A Global Note will be exchangeable, in whole but not in part, for Definitive Notes after surrender of the Global Note to the Issue and Paying Agent only (i) if the clearing system(s) in which the Global Note is held at the relevant time is closed for a continuous period of 14 days or more (other than by reason of weekends or public holidays, statutory or otherwise) or if any such clearing system announces an intention to, or does in fact, permanently cease to do business, or (ii) if default is made in the payment of any amount payable in respect of the Global Note.
				Notes may be issued at a discount or premium to face value or may bear fixed or floating rate interest.
Minimum Term:			Maximum Term:
One day			183 days
Clearing Systems:			Selling Restrictions:
Euroclear Bank S.A./N.V. (" Euroclear "), Clearstream Banking, S.A. (" Clearstream, Luxembourg ") or any other clearing system as may be agreed between the relevant Issuer and the Issue and Paying Agent and in which Notes may from time to time be held			U.S.A. United Kingdom Japan Switzerland The Netherlands Grand Duchy of Luxembourg
Agent for Service of Process:
Ecolab Limited
Address:		P.O. Box 11
		Winnington Avenue Northwich, Cheshire
		United Kingdom CW8 4DX
Telephone:		+44 1 606 744 88
Contact:		Company Secretary

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Schedule 4
INCREASE OF MAXIMUM AMOUNT

[Letterhead of Ecolab]

[Date]

To: [List Dealers]

Citibank, N.A., London Branch (as Issue and Paying Agent])

Dear Sirs

U.S.$2,000,000,000 Euro-commercial paper programme

We refer to an amended and restated dealer agreement dated 9 June 2017 2017 (the " Dealer Agreement ") between ourselves as Issuers, the Guarantor, the Arranger and the Dealers party thereto relating to a U.S.$2,000,000,000 Euro-commercial paper programme (the " Programme "). Terms used in the Dealer Agreement shall have the same meaning in this letter.

In accordance with clause 2.5 of the Dealer Agreement, we hereby notify each of the addressees listed above that the Maximum Amount of the Programme is to be increased from U.S.$[ ],000,000 to U.S.$[ ],000,000 with effect from [ date ], subject to delivery of the following documents:

(a)

an updated or supplemental Information Memorandum reflecting the increase in the Maximum Amount of the Programme;

(b)

certified copies of all documents evidencing the internal authorisations and approvals required to be granted by the Issuers and the Guarantor for such increase in the Maximum Amount;

(c)

certified copies of [specify any governmental or other consents required by the Issuers and the Guarantor] for such increase;

(d)

legal opinions from (i) the Senior SEC Counsel and Assistant Secretary (or an employee of similar standing) of Ecolab Inc. and (ii) Clifford Chance LLP as to the laws of The Netherlands, the Grand Duchy of Luxembourg and the United Kingdom relating to such increase; and

(e)

a list of names, titles and specimen signatures of the persons authorised to sign on behalf of the Issuers and the Guarantor all notices and other documents to be delivered in connection with such an increase in the Maximum Amount.

From the date on which such increase in the Maximum Amount becomes effective, all references in the Dealer Agreement to the Maximum Amount or the amount of the Programme shall be construed as references to the increased Maximum Amount as specified herein.

Yours faithfully

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…………………………………………...

for and on behalf of

ECOLAB INC. (in its capacity as Issuer)

…………………………………………...

for and on behalf of

ECOLAB LUX 1 S.À R.L.

société à responsabilité limitée

6, rue Eugène Ruppert

L-2453 Luxembourg

Grand Duchy of Luxembourg

R.C.S. Luxembourg: B 132319

…………………………………………...

for and on behalf of

ECOLAB LUX 2 S.À R.L.

société à responsabilité limitée

6, rue Eugène Ruppert

L-2453 Luxembourg

Grand Duchy of Luxembourg

R.C.S. Luxembourg: B 132318

…………………………………………...

for and on behalf of

ECOLAB NL 10 B.V.

…………………………………………...

for and on behalf of

ECOLAB NL 11 B.V.

…………………………………………...

for and on behalf of

ECOLAB INC. (in its capacity as Guarantor)

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Schedule 5
APPOINTMENT OF NEW DEALER

[Letterhead of Ecolab]

[Date]

To: [Name of new Dealer]

Dear Sirs

U.S.$[•]00,000,000 Euro-commercial paper programme

We refer to an amended and restated dealer agreement dated 9 June 2017 (the " Dealer Agreement ") between ourselves as Issuers, the Arranger and the Dealers party thereto relating to a U.S.$[•]00,000,000 Euro-commercial paper programme (the " Programme "). Terms used in the Dealer Agreement shall have the same meaning in this letter.

In accordance with Clause ‎6.20 of the Dealer Agreement, we hereby appoint you as an additional dealer for the Programme upon the terms of the Dealer Agreement with [immediate effect/effect from [ date ]]. Please confirm acceptance of your appointment upon such terms by signing and returning to us the enclosed copy of this letter, whereupon you will, in accordance with Clause 6.2 of the Dealer Agreement, become a party to the Dealer Agreement vested with all the authority, rights, powers, duties and obligations as if originally named as a Dealer thereunder.

Yours faithfully

…………………………………………...

for and on behalf of

ECOLAB INC. (in its capacity as Issuer)

…………………………………………...

for and on behalf of

ECOLAB LUX 1 S.À R.L.

société à responsabilité limitée

6, rue Eugène Ruppert

L-2453 Luxembourg

Grand Duchy of Luxembourg

R.C.S. Luxembourg: B 132319

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…………………………………………...

for and on behalf of

ECOLAB LUX 2 S.À R.L.

société à responsabilité limitée

6, rue Eugène Ruppert

L-2453 Luxembourg

Grand Duchy of Luxembourg

R.C.S. Luxembourg: B 132318

…………………………………………...

for and on behalf of

ECOLAB NL 10 B.V.

…………………………………………...

for and on behalf of

ECOLAB NL 11 B.V.

…………………………………………...

for and on behalf of

ECOLAB INC. (in its capacity as Guarantor)

[On copy]

We hereby confirm acceptance of our appointment as a Dealer upon the terms of the Dealer Agreement referred to above. For the purposes of Clause ‎7 ( Notices ), our contact details are as follows:

[Name of Dealer]

Address: [ ]

Telephone: [ ]

Fax: [ ]

Email: [ ]

Contact: [ ]

Dated: …………………………………………...

Signed: …………………………………………...

for [ Name of new Dealer ]

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Schedule 6
FORM OF CALCULATION AGENCY AGREEMENT

THIS AGREEMENT is made on [ date ]

BETWEEN

(1)

[ECOLAB INC. , a corporation organised and existing under the laws of the State of Delaware, having its registered office at 1209 Orange Street, City of Wilmington, Delaware, U.S.A., registered in the State of Delaware under number 0164814 / ECOLAB LUX 1 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg, registered with the Luxembourg Register of Commerce and Companies under number B 132.319; / ECOLAB LUX 2 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg, registered with the Luxembourg Register of Commerce and Companies under number B 132.318 /ECOLAB NL 10 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56036094 /ECOLAB NL 11 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56150547 ] ( delete as appropriate )(the " Issuer "); [and]

(2)

(3)

[CALCULATION AGENT] , as the calculation agent appointed pursuant to Clause ‎ 2 hereof (the " Calculation Agent ", which expression shall include any successor thereto).

WHEREAS :

(A)

Under an amended and restated dealer agreement (as amended, supplemented and/or restated from time to time, the " Dealer Agreement ") dated 9 June 2017 and made between the Issuers, the Guarantor, the Arranger and the Dealer(s) referred to therein, and an amended and restated note agency agreement (as amended, supplemented and/or restated from time to time, the " Agency Agreement ") dated 9 June 2017 and made between the Issuers, the Guarantor and the agents referred to therein, the Issuers established a Euro-commercial paper programme (the " Programme ").

(B)

The Dealer Agreement contemplates, among other things, the issue under the Programme of floating rate notes and provides for the appointment of calculation agents

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in relation thereto. Each such calculation agent's appointment shall be on substantially the terms and subject to the conditions of this Agreement.

IT IS AGREED as follows:

1. INTERPRETATION

1.1 Definitions

Terms not expressly defined herein shall have the meanings given to them in the Dealer Agreement or the Agency Agreement.

1.2 Legislation

1.3 Floating rate Notes

" Relevant Notes " means such floating rate Notes in respect of which the Calculation Agent is appointed.

APPOINTMENT OF CALCULATION AGENT

The Issuer appoints the Calculation Agent as its agent for the purpose of calculating the redemption amount and/or, if applicable, the amount of interest in respect of the Relevant Notes upon the terms and subject to the conditions of this Agreement. The Calculation Agent accepts such appointment.

DETERMINATION AND NOTIFICATION

3.1

Determination

The Calculation Agent shall determine the redemption amount of, and/or, if applicable, the amount of interest payable on, each Relevant Note in accordance with the redemption calculation applicable thereto.

3.2

Notification

The Calculation Agent shall as soon as it has made its determination as provided for in Clause ‎3.1 above (and, in any event, no later than the close of business on the date on which the determination is made) notify the Issuer and the Issue and Paying Agent (if other than the Calculation Agent) of the redemption amount and/or, if applicable, the amount of interest so payable.

STAMP DUTIES

The Issuer will pay all stamp, registration and other similar taxes and duties (including any interest and penalties thereon or in connection therewith) payable in connection with the execution, delivery and performance of this Agreement, except for any taxes

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payable regarding Luxembourg registration duties ( droits d'enregistrement ) due to a registration, submission or filing of this Agreement where such registration, submission or filing is or was not required to maintain or preserve the rights of the Calculation Agent under this Agreement.

INDEMNITY AND LIABILITY

5.1

Indemnity

The Issuer shall indemnify and hold harmless on demand the Calculation Agent against any claim, demand, action, liability, damages, cost, loss or expense (including, without limitation, legal fees and any applicable value added tax) which it may incur arising out of the exercise of its powers and duties as Calculation Agent under this Agreement, except such as may result from its own negligence or bad faith or that of its officers, employees or agents.

5.2

Liability

The Calculation Agent may consult as to legal matters with lawyers selected by it, who may be employees of, or lawyers to, the Issuer. If such consultation is made, the Calculation Agent shall be protected and shall incur no liability for action taken or not taken by it as Calculation Agent or suffered to be taken with respect to such matters in good faith, without negligence and in accordance with the opinion of such lawyers.

CONDITIONS OF APPOINTMENT

The Calculation Agent and the Issuer agree that its appointment will be subject to the following conditions:

(a)

No obligations : in acting under this Agreement, the Calculation Agent shall act as an independent expert and shall not assume any obligations towards or relationship of agency or trust with the Issuer or the owner or holder of any of the Relevant Notes or any interest therein;

(b)

Notices : unless otherwise specifically provided in this Agreement, any order, certificate, notice, request, direction or other communication from the Issuer made or given under any provision of this Agreement shall be sufficient if signed or purported to be signed by a duly authorised employee of the Issuer;

(c)

Duties : the Calculation Agent shall be obliged to perform only those duties which are set out in this Agreement and in the redemption calculation relating to the Relevant Notes;

(d)

Ownership, interest : the Calculation Agent and its officers and employees, in its individual or any other capacity, may become the owner of, or acquire any interest in, any Relevant Notes with the same rights that the Calculation Agent would have if it were not the Calculation Agent hereunder; and

(e)

Calculations and determinations : all calculations and determinations made pursuant to this Agreement by the Calculation Agent shall (save in the case of manifest error) be binding on the Issuer, the Calculation Agent and (if other than the Calculation Agent) the holder(s) of the Relevant Notes and no liability to

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such holder(s) shall attach to the Calculation Agent in connection with the exercise by the Calculation Agent of its powers, duties or discretion under or in respect of the Relevant Notes in accordance with the provisions of this Agreement, except such as may result from its own gross negligence or bad faith or that of its officers, employees or agents.

ALTERNATIVE APPOINTMENT

If, for any reason, the Calculation Agent ceases to act as such or fails to comply with its obligations under Clause ‎3, the Issuer shall appoint [the Issue and Paying Agent] as calculation agent in respect of the Relevant Notes.

THIRD PARTY RIGHTS

LAW AND JURISDICTION

9.1

Governing law

This Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.

9.2

Jurisdiction

The Issuer agrees for the benefit of the Calculation Agent that the courts of England shall have jurisdiction to hear and determine any suit, action or proceedings, and to settle any disputes, which may arise out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement or any non-contractual obligation arising out of or in connection with this Agreement) or the consequences of its nullity (respectively, " Proceedings " and " Disputes ") and, for such purposes, irrevocably submits to the jurisdiction of such courts.

9.3

Appropriate forum

The Issuer irrevocably waives any objection which it might now or hereafter have to the courts of England being nominated as the forum to hear and determine any Proceedings and to settle any Disputes, and agrees not to claim that any such court is not a convenient or appropriate forum.

9.4

Process agent

The Issuer agrees that the process by which any Proceedings in England are begun may be served on it by being delivered to Ecolab Limited at P.O Box 11, Winnington Avenue, Northwich, Cheshire, United Kingdom CW8 4DX or, if different, its registered office for the time being. If such person is not or ceases to be effectively appointed to accept service of process on behalf of the Issuer, the Issuer shall, on the written demand of the Calculation Agent addressed to the Issuer and delivered to the Issuer appoint a further person in England to accept service of process on its behalf and, failing such

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appointment within 15 days, the Calculation Agent shall be entitled to appoint such a person by written notice addressed to the Issuer and delivered to the Issuer. Nothing in this paragraph shall affect the right of the Calculation Agent to serve process in any other manner permitted by law.

9.5

Non exclusivity

The submission to the jurisdiction of the courts of England shall not (and shall not be construed so as to) limit the right of the Calculation Agent to take Proceedings in any other court of competent jurisdiction, nor shall the taking of Proceedings in any one or more jurisdictions preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not) if and to the extent permitted by law.

10.

COUNTERPARTS

This Agreement may be signed in any number of counterparts, all of which when taken together shall constitute a single agreement.

AS WITNESS the hands of the duly authorised representatives of the parties hereto the day and year first before written.

[ECOLAB INC. (in its capacity as Issuer)

By: …………………………………………...

ECOLAB LUX 1 S.À R.L.

By: …………………………………………...

ECOLAB LUX 2 S.À R.L.

By: …………………………………………...

ECOLAB NL 10 B.V.

By: …………………………………………...

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ECOLAB NL 11 B.V.

By: …………………………………………...

ECOLAB INC. (in its capacity as Guarantor)

By: …………………………………………... ]*

(*Delete as appropriate)

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SIGNATURE PAGE

The Issuers

ECOLAB INC.


By:	/s/ Kristen Bettmann

ECOLAB LUX 1 S.À R.L.

.
By:	/s/ Kristen Bettmann

ECOLAB LUX 2 S.À R.L.

L
By:	/s/ Kristen Bettmann

ECOLAB NL 10 B.V.


By:	/s/ Kristen Bettmann

ECOLAB NL 11 B.V.


By:	/s/ Kristen Bettmann

The Guarantor

ECOLAB INC.


By:	/s/ Kristen Bettmann

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	- 1 -

The Arranger

CREDIT SUISSE SECURITIES (EUROPE) LIMITED


By:	/s/ Richard Johnson

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	- 2 -

The Dealers

CITIBANK EUROPE PLC, UK BRANCH


By:	/s/ Angela Donnelly

(duly authorised attorney)

87441-3-18475-v3.0
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CREDIT SUISSE SECURITIES (EUROPE) LIMITED


By:	/s/ Richard Johnson

(duly authorised attorney)

87441-3-18475-v3.0
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	CLIFFORD CHANCE LLP
Exhibit 10.1.B



		Execution Version



ECOLAB INC. ECOLAB LUX 1 S.À R.L. ECOLAB LUX 2 S.À R.L. ECOLAB NL 10 B.V. ECOLAB NL 11 B.V. as Issuers ECOLAB INC. (in respect of notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.) as Guarantor and CITIBANK, N.A., LONDON BRANCH as Issue and Paying Agent
	AMENDED AND RESTATED NOTE AGENCY AGREEMENT RELATING TO A U.S.$2,000,000,000 EURO-COMMERCIAL PAPER PROGRAMME

CONTENTS


Clause	Page


1.	Interpretation	2
2.	Appointments	5
3.	Issue of Notes	5
4.	Payment	7
5.	Cancellation, Destruction, Records and Custody	8
6.	Fees and Expenses	9
7.	Indemnity	9
8.	No Liability for Consequential Loss	10
9.	Agents of the Issuers	10
10.	General	10
11.	Changes in Agent	11
12.	Agent as Holders of Notes	11
13.	Notices	11
14.	Tax	12
15.	Illegality	13
16.	Law and Jurisdiction	13
17.	Rights of Third Parties	14
18.	Modification	14
19.	Counterparts	14
20.	Entire Agreement	14
Schedule 1	Forms of Note	16
Schedule 2	Duties under the Issuer-ICSDS Agreement	48

THIS AGREEMENT is made on 9 June 2017

BETWEEN

(1) ECOLAB INC. , a corporation organised and existing under the laws of the State of Delaware, having its registered office at 1209 Orange Street, City of Wilmington, Delaware, U.S.A., registered in the State of Delaware under number 0164814;

(2) ECOLAB LUX 1 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.319;

(3) ECOLAB LUX 2 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.318;

(4) ECOLAB NL 10 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56036094;

(5) ECOLAB NL 11 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56150547,

(each of Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. is referred to herein as an " Issuer " and together, the " Issuers ");

(6) ECOLAB INC. (the " Guarantor ", in respect of Notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.); and

(7) CITIBANK, N.A., LONDON BRANCH (the " Agent ").

WHEREAS

(A) Ecolab Inc., as Issuer and Guarantor, with certain other issuers and the Agent named therein entered into an amended and restated note agency agreement dated 21 September 2016 (the " Original Agreement ") in relation to a euro-commercial paper programme pursuant to which the Issuers may from time to time issue Notes (as defined below).

(B) In connection with such programme, the Issuers and the Guarantor have entered into a further amended and restated dealer agreement (as amended, supplemented and/or restated from time to time, the " Dealer Agreement ") dated the date hereof and made between the Issuers, the Arranger, the Guarantor and the dealers from time to time party thereto (together, the " Dealers " and each a " Dealer ").

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IT IS AGREED as follows:

1. INTERPRETATION

1.1 In this Agreement:

" Agents " means Citibank, N.A., London Branch acting as issue and paying agent and as calculation agent (if so appointed in relation to a Series of Notes) and " Agent " shall be construed accordingly.

" Applicable Law " means any law or regulation including, but not limited to: (i) any statute or regulation; (ii) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (iii) any agreement between any Authorities; and (iv) any customary agreement between any Authority and any Party.

" Authority " means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.

" Business Day ", except to the extent that the context requires otherwise, means a day (other than a Saturday or Sunday):

(a) on which deposits in the relevant currency are dealt in on the London Interbank Market;

(b) on which commercial banks and foreign exchange markets settle payments and are open for business in London and, if a payment is to be made on that day under this Agreement or any of the Notes, in the place of payment and (other than for payments in euro) the principal financial centre of the country of the relevant currency in which the payment is to be made;

(d) in the case of Notes denominated in Euro, a day which is a TARGET Business Day (as defined below);

" Classic Global Note " means a Note in global form which specifies on its face that it is not a New Global Note, representing an issue of commercial paper of a like maturity which may be issued from time to time by an Issuer pursuant to this Agreement;

" Clearstream, Luxembourg " means Clearstream Banking, société anonyme or any successor thereto.

" Clearing System " means each or any of Clearstream, Luxembourg, Euroclear or such other recognised clearing system as may be agreed from time to time between the Issuers and the Agent which, for so long as the Issuer maintains the STEP Label, shall be a securities settlement system complying with the requirement of the STEP Convention, or any successor thereto.

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

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" Common Depositary " means Citibank, N.A., London Branch acting as a depositary common to Euroclear and Clearstream, Luxembourg at such offices in London as shall be notified by both of them to the Agent from time to time.

" Common Safekeeper " means, in respect of any New Global Note, the common safekeeper which is appointed pursuant to Clause 3.13 in respect of such New Global Note or, if such New Global Note is intended to be held in a manner that would allow Eurosystem eligibility, the common safekeeper that is appointed for the relevant Issuer and eligible to hold such New Global Note for the purpose of the requirements relating to collateral for Eurosystem monetary and intra-day credit operations.

" Common Service Provider " has the meaning given to it in Schedule 2.

" Deed of Covenant " means the deed of covenant, dated the date hereof, executed by the Issuers in respect of Global Notes issued pursuant to this Agreement, as such deed may be amended or supplemented from time to time.

" Definitive Note " means a Note in definitive form.

" Dollars " and " U.S.$ " denote the lawful currency of the United States of America; and " Dollar Note " means a Note denominated in Dollars.

" Euro " and " € " denote the lawful currency introduced at the start of the third stage of European Economic and Monetary Union pursuant to the Treaty on the Functioning of the European Union, as amended from time to time; and " Euro Note " means a Note denominated in Euro.

" Euroclear " means Euroclear Bank S.A./N.V. or any successor thereto.

" Eurosystem " means credit operations of the central banking system for the euro.

" FATCA Withholding " means any withholding or deduction required pursuant to an agreement described in section 1471(b) of the Code, or otherwise imposed pursuant to sections 1471 through 1474 of the Code, any regulations or agreements thereunder, any official interpretations thereof, or any law implementing an intergovernmental approach thereto.

" Global Note " means a New Global Note or a Classic Global Note.

" Guarantee " means the guarantee, dated the date hereof, issued by the Guarantor in respect of any Note issued hereunder.

" ICSD" means a Clearing System authorised to hold any New Global Notes as eligible collateral for Eurosystem monetary policy and intra-credit operations, as agreed between the Issuer and the Agent;

" Maximum Amount " means U.S.$2,000,000,000 or the equivalent amount denominated in any currency other than Dollars, as such amount may be increased from time to time pursuant to the Dealer Agreement.

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" New Global Note " means a Note in global form which specifies on its face that it is a New Global Note, representing an issue of commercial paper of a like maturity which may be issued from time to time by an Issuer pursuant to this Agreement.

" Note " means a commercial paper note of an Issuer subscribed or to be subscribed by a Dealer under the Dealer Agreement, in bearer definitive or global form, substantially in the relevant form scheduled hereto or such other form(s) as may be agreed from time to time between the relevant Issuer and the Agent and, unless the context otherwise requires, includes the commercial paper notes represented by the Global Notes.

" Party " means a party to this Agreement.

" STEP Label " has the meaning set out in the STEP Convention;

" Sterling " and " £ " denote the lawful currency of the United Kingdom; and " Sterling Note " means a Note denominated in Sterling.

" Swiss Franc " denotes the lawful currency of Switzerland; and " Swiss Franc Note " means a Note denominated in Swiss Francs.

" TARGET Business Day " means a day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET2) System, or any successor thereto, is open.

" Tax " means any present or future taxes, duties, assessments or governmental charges of whatever nature imposed, levied, collected, withheld or assessed by or on behalf of any Authority having power to tax.

" Yen " and " ¥ " denote the lawful currency of Japan; and " Yen Note " means a note denominated in Yen.

1.2 References in this Agreement to the principal amount of any Note shall be deemed to include any additional amounts which may become payable in respect thereof pursuant to the terms of such Note.

1.3 Any reference in this Agreement to a Clause or a Schedule is, unless otherwise stated, to a clause hereof or a schedule hereto.

1.4 Headings and sub-headings are for ease of reference only and shall not affect the construction of this Agreement.

1.5 The Original Agreement shall be amended and restated on the terms of this Agreement. Any Notes issued on or after the date of this Agreement shall be issued pursuant to this Agreement.

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2. APPOINTMENTS

2.1 The Issuers and the Guarantor hereby appoint Citibank, N.A., London Branch at its specified office in London as issue agent and as paying agent for the Notes.

2.2 The Agent may act as calculation agent for floating rate Notes, on substantially the terms set out in this Agreement, subject in each case to its specific agreement to act as such for each relevant series of Notes.

2.3 Any reference herein to the " Agent " or its " specified office " shall be deemed to include such other agent or office of the Agent (as the case may be) as may be appointed or specified from time to time hereunder.

3. ISSUE OF NOTES

3.1 Each Note issued hereunder shall be substantially in the relevant form scheduled hereto or, as the case may be, such other form as may be agreed between the relevant Issuer and the Agent from time to time and shall be duly executed either manually or in facsimile on behalf of the relevant Issuer and authenticated by an authorised signatory or signatories of the Agent and in the case of a New Global Note, be effectuated manually by or on behalf of the Common Safekeeper. Each relevant Issuer shall procure that a sufficient quantity of executed but unauthenticated blank Notes is at all times available to the Agent for the purpose of issue under this Agreement.

3.2 The relevant Issuer shall give to the Agent by fax or email or through the CitiDirect for Securities IPA system details of any Notes to be issued by it under this Agreement and all such other information as the Agent may require for it to carry out its functions as contemplated by this Clause, by not later than 4.00 p.m. (London time) two Business Days prior to the proposed issue date (or such later time or date as may be agreed between the relevant Issuer and the Agent) in respect thereof and the Agent shall thereupon be authorised to complete Notes of the appropriate aggregate amount and/or (as the case may be) a Global Note by inserting in the appropriate place on the face of each Note inter alia the dates on which such Note shall be issued and shall mature and otherwise completing the same.

3.3 If any such Notes as are mentioned in Clause 3.2 are not to be issued on any issue date, the relevant Issuer shall notify the Agent immediately, and in any event no later than 4.00 p.m. (London time) one Business Day prior to the proposed issue date. Upon receipt of such notice the Agent shall not thereafter issue or release the relevant Notes, but shall cancel and destroy them.

3.4 The Agent shall, upon notification by telephone, fax or email from the Dealer who has arranged to purchase Notes from the relevant Issuer, such notification to be received in sufficient time to enable delivery to be made as contemplated herein and in any event no later than 10.00 a.m. (London time) one Business Day prior to the proposed issue date or such later time or date as may be agreed between the Agent and the relevant Dealer, that payment by it to the relevant Issuer of the purchase price of any Note has been or will be duly made against delivery of such Notes and (if applicable) of details of the securities account hereinafter referred to deliver such Note on the Business Day immediately preceding its issue date (unless specified otherwise) to (A) save in the case of a Global Note which is a Classic Global Note, a common depositary for Euroclear

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and Clearstream, Luxembourg and/or such other recognised clearing system as may be agreed from time to time between the relevant Issuer and the Agent or (B) in the case of a Global Note which is a New Global Note, as the case may be, to the Common Safekeeper, together with instructions to effectuate the same, for credit on the issue date of such Note to such securities account as shall have been notified to it or if no such details are given make the same available on its issue date for collection at its specified office in London.

3.5 The Agent shall (if applicable) give instructions to the relevant Clearing System to credit the Notes to the Agent's distribution account and, in the case of a New Global Note, the Agent shall instruct the Common Safekeeper to effectuate the New Global Note (provided that, if the Agent is the Common Safekeeper, the Agent shall effectuate the Global Note). Each Note credited to the Agent's distribution account with the relevant Clearing System following the delivery of the Notes in accordance with Clause 3.4 above shall be held to the order of the relevant Issuer pending delivery to the relevant Dealer on a delivery against payment basis in accordance with the normal procedures of the relevant Clearing System. The Agent shall on the issue date and against receipt of funds from the relevant Dealer transfer the proceeds of issue to the relevant Issuer to the relevant account notified by the relevant Issuer to the Agent in accordance with Clause 3.2 above.

3.6 If on the issue date the relevant Dealer does not pay the subscription price due from it in respect of any Note (the " Defaulted Note ") and as a result the Defaulted Note remains in the Agent's distribution account with the relevant Clearing System after the issue date (rather than being credited to the Dealer's Account against payment), the Agent will continue to hold the Defaulted Note to the order of the relevant Issuer.

3.7 If the Agent pays an amount (the " Advance ") to the relevant Issuer on the basis that a payment (the " Payment ") has been, or will be, received from the relevant Dealer and if the Payment has not been or is not received by the Agent on the date the Agent pays the relevant Issuer, the Agent shall promptly inform the relevant Dealer and request that Dealer to make good the Payment, failing which the relevant Issuer shall, upon being requested to do so, repay to the Agent the Advance and pay interest (on the basis of the aggregate of 1 per cent. per annum and the Agent's cost of funding, as determined by the Agent in its sole discretion) on the Advance until the earlier of repayment in full of the Advance and receipt in full by the Agent of the Payment.

3.8 As soon as practicable after the date of issue of any Notes, the Agent shall deliver to the relevant Issuer particulars of (a) the number and aggregate principal amount of the Notes completed, authenticated and delivered by it, or made available by it for collection, on such date, (b) the issue date and the maturity date of such Notes and (c) the series and serial numbers of all such Notes if requested.

3.9 Each Issuer hereby authorises and instructs the Agent to make all necessary notifications to and filings with the Bank of England, the Japanese Ministry of Finance (in respect of Yen Notes) and the relevant Swiss authorities (in respect of Swiss Franc Notes).

3.10 Each Issuer hereby authorises and instructs the Agent to complete, authenticate and deliver on its behalf Definitive Notes in accordance with the terms of any Global Note presented to the Agent for exchange in whole (but not in part only) and in the case of

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exchange in whole of a New Global Note for Definitive Notes instruct the ICSDs to make appropriate entries in their records to reflect the aggregate principal amount thereof so exchanged, cancel or procure the cancellation of the Global Note and instruct the Common Safekeeper to destroy the Global Note.

3.11 The Issuers will give at least 10 days prior written notice to the Agent of a change in the Maximum Amount of Notes which may be issued under the Dealer Agreement.

3.12 The Issuers will promptly notify the Agent in writing of the appointment, resignation or termination of the appointment of any Dealer. If the notification is in respect of a new dealer appointment, the Issuers will notify the Agent two business days prior to the new issue.

3.13 Each Issuer hereby authorises and instructs the Agent to elect an ICSD to be Common Safekeeper for each issue of a New Global Note in relation to which one of the ICSDs must be Common Safekeeper. From time to time, the Issuers and the Agent may agree to vary this election. Each Issuer acknowledges that in connection with the election of either of the ICSDs as Common Safekeeper any such election is subject to the right of the ICSDs to jointly determine that the other shall act as Common Safekeeper in relation to any such issue and agrees that no liability shall attach to the Agent in respect of any such election made by it.

4. PAYMENT

4.1 Each Issuer (failing whom, the Guarantor) severally undertakes in respect of each Note issued by such Issuer to pay, in the currency in which such Note is denominated, no later than 10.00 a.m. (London time) (in the case of a Note denominated in Sterling or Euros) and no later than 12.00 pm (London time) (in the case of a Note denominated in Dollars) on the maturity date or any relevant interest payment date of each Note (or for Notes denominated in any other currency, such other time as the Agent shall determine in its absolute discretion), an amount sufficient to pay the full amount payable on such date by way of principal interest or otherwise in respect thereof by transfer of immediately available and freely transferable funds in the relevant currency to such account of the Agent at such bank in the principal financial centre for such other currency as the Agent may from time to time designate for the purpose or, in each case, by such other form of transfer as may be agreed between the relevant Issuer and the Agent. If the Agent determines in its absolute discretion that the payment in accordance with this Clause 4.1 is required to be made earlier, it will provide to the relevant Issuer not less than 21 days prior notice in writing of such requirement.

4.2 The relevant Issuer shall, prior to 12 noon (London time) on the second Business Day immediately preceding the maturity date or any relevant interest payment date of any Note (or such later time or date as may subsequently be agreed between the relevant Issuer and the Agent), send to the Agent irrevocable confirmation that payment will be made and the details of the bank through which the relevant Issuer is to make the payment due pursuant to this Clause 4.2.

4.3 Each Issuer hereby authorises and directs the Agent from funds so paid to the Agent to make payment of all amounts due on the Notes as set forth herein and in the Notes.

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4.4 If the Agent has not received on the maturity date or any relevant interest payment date of any Notes the full amount payable in respect thereof on such date and confirmation satisfactory to itself that such payment has been received, the Agent shall not be required to make payment of any amount due on any Note. Nevertheless, subject to the foregoing, if the Agent is satisfied that it will receive such full amount later, it shall be entitled to pay maturing Notes due in accordance with their terms.

4.5 If the Agent makes such payment on behalf of an Issuer under Clause 4.4, the relevant Issuer shall be liable on demand by the Agent to pay to the Agent the amount so paid out, together with interest thereon at such a rate as the Agent may certify as the aggregate of 1 per cent. per annum and the Agent's cost of funding any such payment made by it (as determined by the Agent in its sole discretion).

4.6 If at any time the Agent makes a partial payment in respect of any Note presented to it, it shall in the case of a Classic Global Note or Definitive Note, procure that a statement indicating the date and amount of such payment is written or stamped on the face of such Note and in the case of a New Global Note, instruct the ICSDs (in accordance with the provisions of Schedule 2 ( Duties under the Issuer-ICSDs Agreement )) to make appropriate entries in their respective records to reflect such partial payments.

4.7 Payments to holders of the Notes shall not be made to an address or a bank account maintained within the United States; the Notes may not be presented for payment within the United States; and demand for payments under the Notes may not be made within the United States.

5. CANCELLATION, DESTRUCTION, RECORDS AND CUSTODY

5.1 All Notes which mature and are paid in full shall be cancelled forthwith by the Agent. The Agent shall, unless the relevant Issuer otherwise directs, destroy the cancelled Notes, and as soon as reasonably practicable after each maturity date, furnish at the request of the relevant Issuer with particulars of the aggregate principal amount of the Notes maturing on such maturity date which have been destroyed since the last certification so furnished and the series and serial numbers of all such Notes.

5.2 In respect of New Global Notes which mature and are paid in full, the Agent shall cancel such aggregate principal amount outstanding of Notes represented by such New Global Note. The Agent shall instruct the ICSDs (in accordance with the provisions of Schedule 2 ( Duties under the Issuer-ICSDs Agreement )) to make appropriate entries in their respective records to reflect such cancellation and shall instruct the Common Safekeeper to destroy the New Global Note.

5.3 In the case of a New Global Note which has been destroyed by the Common Safekeeper, the Agent shall, upon receipt of confirmation of destruction from the Common Safekeeper, furnish the relevant Issuer with a copy of the confirmation of destruction received by it from the Common Safekeeper (provided that, if the Agent is the Common Safekeeper, the Agent shall destroy the New Global Note, as the case may be, in accordance with Clause 3.10, Clause 5.2 and/or Clause 5.4.

5.4 The Agent shall keep and make available at all reasonable times to the relevant Issuer a full and complete record of all Notes and of their issue, payment, cancellation and destruction and, in the case of Global Notes, their exchange for Definitive Notes.

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5.5 The Agent shall maintain in safe custody all forms of Notes delivered to and held by it hereunder and shall ensure that the same are only completed, authenticated and delivered or made available in accordance with the terms hereof.

5.6 An Issuer may from time to time with the approval, where appropriate, of the Agent make arrangements as to the replacement of Notes which shall have been lost, stolen, mutilated, defaced or destroyed, including (without limitation) arrangements as to evidence of title, costs, delivery and indemnity. No New Global Note shall be delivered as a replacement for any of the same lost, stolen, mutilated, defaced or destroyed otherwise than against confirmation of such loss, stolen form, mutilation, defacement or destruction from the Common Safekeeper and any replacement New Global Note shall be delivered to the Common Safekeeper together with instructions to effectuate it.

5.7 The Agent shall make available for inspection during its office hours at its specified office copies of this Agreement, the Deed of Covenant and the Guarantee.

6. FEES AND EXPENSES

6.1 Each Issuer (failing whom, the Guarantor) severally undertakes to pay such fees and expenses in respect of the Agent's services under this Agreement as are set out in a letter of even date herewith from the Agent to each Issuer, at the time and in accordance with the manner stated therein.

6.2 Each Issuer (failing whom, the Guarantor) severally undertakes to pay all stamp, registration and other taxes and duties (including any interest and penalties thereon or in connection therewith) to which this Agreement or the issue of any Notes may be subject, except for any taxes payable regarding Luxembourg registration duties ( droits d’enregistrement ) due to a registration, submission or filing of this Agreement or the Notes where such registration, submission or filing is or was not required to maintain or preserve the rights of the Agent under this Agreement or the Notes.

6.3 Each Issuer (failing whom, the Guarantor) severally undertakes to pay on demand all out-of-pocket expenses (including legal, advertising, telex and postage expenses) properly incurred by the Agent in connection with its services under this Agreement.

7. INDEMNITY

7.1 Each Issuer (failing whom, the Guarantor) severally undertakes to indemnify and hold harmless the Agent on demand by the Agent against any losses, liabilities, costs, expenses, claims, actions or demands which the Agent may incur or which may be made against the Agent, directly related to the appointment or the exercise of the powers, discretions, authorities and duties of the Agent under this Agreement except such as may result from its own gross negligence or bad faith or that of its officers, employees or agents under this Agreement. The indemnities contained in this Agreement shall survive the termination or expiry of this Agreement.

7.2 The Agent undertakes to indemnify and hold harmless each Issuer on demand by an Issuer against any losses, liabilities, costs, expenses, claims, actions or demands which an Issuer may incur or which may be made against an Issuer as a result of the Agent's own gross negligence or bad faith or that of its officers, employees or agents under this Agreement.

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8. NO LIABILITY FOR CONSEQUENTIAL LOSS

Except in the case of gross negligence or wilful default, the Agent shall not be liable either for any act or omission under this Agreement, or if any Note shall be lost, stolen, destroyed or damaged. Notwithstanding the foregoing, under no circumstances will the Agent be liable to an Issuer or the Guarantor, nor an Issuer or the Guarantor liable to the Agent, for any consequential loss (being loss of business, goodwill, opportunity or profit) or any special or punitive damages of any kind whatsoever; in each case however caused or arising and whether or not foreseeable, even if advised of the possibility of such loss or damage.

9. AGENTS OF THE ISSUERS

9.1 In acting hereunder and in connection with the Notes, the Agent shall act solely as agent of the Issuers and the Guarantor and will not thereby assume any obligations towards or relationship of agency or trust for any holders of Notes, including as a custodian, nominee or otherwise. Any funds held by the Agent in respect of the Notes need not be segregated from other funds except as required by law. The Agent shall not be under any liability for interest on any moneys at any time received by it pursuant to any of the provisions of this Agreement or of the Notes. Any funds held are held as banker and are not subject to the UK FCA Client Money Rules.

9.2 The Agent may generally engage in any kind of banking or other business with the Issuers notwithstanding its appointments as issue agent and paying agent hereunder.

10. GENERAL

10.1 Prior to the first issue of the Notes, each Issuer shall supply to the Agent copies of all condition precedent documents required to be delivered pursuant to the Dealer Agreement.

10.2 The Agent shall be obliged to perform such duties and only such duties as are herein specifically set forth, and no implied duties or obligations shall be read into this Agreement against the Agent. The Agent shall not be under any obligation to take any action hereunder which it expects will result in any expense or liability of the Agent, the payment of which within a reasonable time is not, in its opinion, assured to it.

10.3 Except as ordered by a court of competent jurisdiction or as required by law, and notwithstanding any notice to the contrary, the Issuers and the Agent shall be entitled to treat the bearer or holder of any Note as the absolute owner thereof for all purposes and shall not be required to obtain any proof thereof or as to the identity of the bearer or holder.

10.4 The Agent may consult with legal and other professional advisers selected in good faith and satisfactory to it and the opinion of such advisers shall be full and complete protection in respect of any action taken, omitted or suffered hereunder in good faith and without negligence and in accordance with the opinion of such advisers.

10.5 The Agent shall be protected and shall incur no liability for or in respect of any action taken or thing suffered by it in relation to any issue of Notes in reliance upon any Note, notice, direction, consent, certificate, affidavit, statement, email, fax or other paper or

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document (electronic or otherwise) reasonably believed by it in good faith to be genuine and to have been passed or signed by the proper parties.

11. CHANGES IN AGENT

11.1 The Agent may resign its appointment hereunder at any time by giving to the Issuers, and the Issuers may terminate the appointment of the Agent by giving to the Agent, at least 30 days' written notice to that effect, provided that no such resignation or termination of the appointment of the Agent shall take effect until a successor has been appointed by the Issuers or the Guarantor.

11.2 The Issuers agree with the Agent that if, by the day falling 10 days before the expiry of any notice under Clause 11.1, the Issuers or the Guarantor have not appointed a replacement Agent, then the Agent shall be entitled, on behalf of the Issuers and the Guarantor, to appoint in its place any reputable financial institution of good standing (subject to the proviso in Clause 12 below) and the Issuers shall not unreasonably object to such appointment.

12. AGENT AS HOLDERS OF NOTES

The Agent and its officers and employees, in their individual or any other capacity, may become the owner of, or acquire any interest in, any Notes with the same rights that the Agent would have if it were not the Agent hereunder.

13. NOTICES

13.1 All notices and other communications hereunder shall, save as otherwise provided in this Agreement, be made in writing and in English (by letter, fax or email) and shall be sent to the intended recipient at the address, fax number or email address and marked for the attention of the person (if any) from time to time designated by that Party to the other Parties for such purpose. The initial address, email address and fax number so designated by each Party are set out on the signature page of this Agreement.

13.2 Any communication from any Party to any other under this Agreement shall be effective if sent by letter, upon receipt by the addressee; if sent by fax, when that fax communication has been received by the intended recipient in legible form; and if sent by email, when the email communication has been received by the intended recipient in legible form at the correct email address ; provided that any such notice or other communication which would otherwise take effect after 4.00 p.m. on any particular day shall not take effect until 10.00 a.m. on the immediately succeeding business day in the place of the addressee.

13.3 Whilst the Notes are held through the Clearing Systems, a notice will be deemed to have been given to the holder if such notice is sent to the Clearing Systems for publication to holders.

14. TAX

14.1 Mutual Undertaking Regarding Information Reporting and Collection Obligations

Each Party shall, within ten business days of a written request by another Party, supply

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to that other Party such forms, documentation and other information relating to it, its operations, or the Notes as that other Party reasonably requests for the purposes of that other Party's compliance with Applicable Law and shall notify the relevant other Party reasonably promptly in the event that it becomes aware that any of the forms, documentation or other information provided by such Party is (or becomes) inaccurate in any material respect; provided, however, that no Party shall be required to provide any forms, documentation or other information pursuant to this Clause 14 ( Tax ) to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to such Party and cannot be obtained by such Party using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of such Party constitute a breach of any: (a) Applicable Law; (b) fiduciary duty; or (c) duty of confidentiality.

14.2 Notice of Possible Withholding Under FATCA

The relevant Issuer shall notify each Agent in the event that it determines that any payment to be made by an Agent under the Notes is a payment which could be subject to FATCA Withholding if such payment were made to a recipient that is generally unable to receive payments free from FATCA Withholding, and the extent to which the relevant payment is so treated, provided, however, that such Issuer's and the Guarantor's respective obligations under this Clause 14 ( Tax ) shall apply only to the extent that such payments are so treated by virtue of characteristics of the relevant Issuer, the Guarantor, the Notes, or any of these characteristics.

14.3 Agent Right to Withhold

Notwithstanding any other provision of this Agreement, each Paying Agent shall be entitled to make a deduction or withholding from any payment which it makes under the Notes for or on account of any Tax, if and only to the extent so required by Applicable Law, in which event the Paying Agent shall make such payment after such deduction or withholding has been made and shall account to the relevant Authority within the time allowed for the amount so deducted or withheld or, at its option, shall reasonably promptly after making such payment return to the relevant Issuer or, as the case may be, the Guarantor the amount so deducted or withheld, in which case, the relevant Issuer or, as the case may be, the Guarantor shall so account to the relevant Authority for such amount. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Clause 14.3 ( Agent Right to Withhold ). If such a withholding or deduction is required, the Agent will not pay an additional amount in respect of that withholding or deduction.

14.4 Issuer and Guarantor Right to Redirect

In the event that any Issuer or the Guarantor, as the case may be, determines in its sole discretion that any deduction or withholding for or on account of any Tax will be required by Applicable Law in connection with any payment due to any of the Agents on any Notes, then such Issuer or the Guarantor, as the case may be, will be entitled to redirect or reorganise any such payment in any way that it sees fit in order that the payment may be made without such deductions or withholding provided that, any such redirected or reorganised payment is made through a recognised institution of international standing and otherwise made in accordance with this Agreement. Such

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Issuer will promptly notify the Agents of any such redirection or reorganisation. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Clause 14.4 ( Issuer and Guarantor Right to Redirect ).

15. ILLEGALITY

Notwithstanding anything else contained in this Agreement, each Agent may refrain without liability from doing anything that would or might in its reasonable opinion be contrary to any law of any state or jurisdiction (including but not limited to the United States of America or any jurisdiction forming a part of it and England & Wales) or any directive or regulation of any agency of any such state or jurisdiction and may without liability do anything which is, in its reasonable opinion, necessary to comply with any such law, directive or regulation.

16. LAW AND JURISDICTION

16.1 This Agreement, the Notes and any non-contractual obligations arising out of or in connection with them are governed by English law. For the avoidance of doubt, the provisions of the Luxembourg law dated 15 August 1915 on commercial companies, as amended, and in particular, sections 86 to 94-8, are hereby excluded.

16.2 Each of the Issuers agrees for the benefit of the Agent that the courts of England shall have exclusive jurisdiction to hear and determine any suit, action or proceedings, and to settle any disputes, which may arise out of or in connection with this Agreement or any non-contractual obligation arising out of or in connection with this Agreement (respectively, " Proceedings " and " Disputes ") and, for such purposes, irrevocably submits to the jurisdiction of such courts.

16.3 Each of the Issuers and the Guarantor irrevocably waive any objection which it might now or hereafter have to the courts of England being nominated as the forum to hear and determine any Proceedings and to settle any Disputes, and agrees not to claim that any such court is not a convenient or appropriate forum.

16.4 Each of the Issuers and the Guarantor agree that the process by which any Proceedings in England are begun may be served on it by being delivered to Ecolab Limited at P.O. Box 11, Winnington Avenue, Northwich, Cheshire, United Kingdom CW8 4DX or at its registered office for the time being or any other address for the time being at which process may be served on it in accordance with the Companies Act 2006 (as modified or re-enacted from time to time). If such person is not or ceases to be effectively appointed to accept service of process on the Issuers' and the Guarantor's behalf, the Issuers and the Guarantor (acting together) shall, on the written demand of the Agent, appoint a further person in England to accept service of process on their behalf and, failing such appointment within 15 days, the Agent shall be entitled to appoint such a person by written notice to the Issuers and the Guarantor. Nothing in this sub-clause shall affect the right of the Agent to serve process in any other manner permitted by law.

16.5 The submission to the jurisdiction of the courts of England shall not (and shall not be construed so as to) limit the right of the Agent to take Proceedings in any other court of competent jurisdiction, nor shall the taking of Proceedings in any one or more

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jurisdictions preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not) if and to the extent permitted by law.

16.6 If Ecolab NL 10 B.V. or Ecolab NL 11 B.V. are represented by an attorney or attorneys in connection with the signing and/or execution and/or delivery of this Agreement or any agreement or document referred to herein or made pursuant hereto and the relevant power or powers of attorney is or are expressed to be governed by the laws of The Netherlands, it is hereby expressly acknowledged and accepted by the other Parties that such laws shall govern the existence and extent of such attorney's or attorneys' authority and the effects of the exercise thereof.

17. RIGHTS OF THIRD PARTIES

18. MODIFICATION

This Agreement may be amended by further agreement among the Parties and without the consent of holders of the Notes.

19. COUNTERPARTS

This Agreement may be signed in any number of counterparts, all of which when taken together shall constitute a single agreement.

20. ENTIRE AGREEMENT

20.1 This Agreement constitutes the entire agreement between the Parties relating to the subject matter of this Agreement as at the date of this Agreement to the exclusion of any terms implied by law which may be excluded by contract. This Agreement supersedes any previous written or oral agreements between the Parties relating to the subject matter of this Agreement which shall cease to have any further force or effect notwithstanding the existence of any provision of any such prior agreement (including without limitation the Original Agreement) that any such rights or provisions shall survive its termination.

20.2 Each Party acknowledges that it has not been induced to enter into this Agreement by any representation, warranty or undertaking not expressly incorporated into it.

20.3 Each Party agrees and acknowledges that, without prejudice to any liability for fraudulent misrepresentation or fraudulent misstatement, its only rights and remedies in relation to any representation, warranty or undertaking made or given in connection with this Agreement are those rights and remedies set out in this Agreement.

20.4 For the purposes of sub-clauses 20.1 to 20.3, reference to "this Agreement" includes all documents entered into pursuant to this Agreement.

AS WITNESS the hands of the duly authorised representatives of the Parties the day and year first before written.

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SCHEDULE 1

FORMS OF NOTE

Form of Multicurrency Global Note
(Interest Bearing/Discounted/Premium) 1

THE SECURITIES REPRESENTED BY THIS GLOBAL NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE " SECURITIES ACT ") OR ANY U.S. STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR DELIVERED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) UNLESS AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IS AVAILABLE AND IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND ANY OTHER JURISDICTION. THIS LEGEND SHALL CEASE TO APPLY UPON THE EXPIRY OF THE PERIOD OF 40 DAYS AFTER THE COMPLETION OF THE DISTRIBUTION OF ALL THE SECURITIES OF THE TRANCHE OF WHICH THIS SECURITY FORMS PART.

ECOLAB INC.

(incorporated under the laws of the State of Delaware)

ECOLAB LUX 1 S.À R.L.

( incorporated as a private limited liability company (société à responsibilité limitée) for an unlimited duration under the laws of the Grand Duchy of Luxembourg )

ECOLAB LUX 2 S.À R.L.

( incorporated as a private limited liability company (société à responsibilité limitée) for an unlimited duration under the laws of the Grand Duchy of Luxembourg )

ECOLAB NL 10 B.V.

(incorporated as a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under the laws of the Netherlands )

ECOLAB NL 11 B.V.

(incorporated as a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under the laws of the Netherlands )

guaranteed by

ECOLAB INC.

(in respect of Notes issued by

Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.)


No:___________________________________________	Series No.:___________________________________
Issued in London on:_________________________	Maturity Date:_______________________________
Specified Currency:___________________________	Denomination:_______________________________
Nominal Amount:_____________________________ (words and figures if a Sterling Note)	Reference Rate: LIBOR/EURIBOR1 1

1 Delete as appropriate. The reference rate will be LIBOR unless this Global Note is denominated in euro and the Issuer and the relevant Dealer agree that the reference rate should be EURIBOR.

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Fixed Interest Rate: 2 % per annum	Margin: _________________________________ % 3

Calculation Agent: 4 ___________________________	Interest Payment Dates: 5 _____________________
New Global Note Form: 6	New Global Note intended to be held in a manner which would allow Eurosystem eligibility 7 [Note that the designation "yes" means that the Notes are intended upon issue to be deposited with Euroclear Bank S.A./N.V. or Clearstream Banking S.A as common safekeeper and does not necessarily mean that the Notes will be recognised as eligible collateral for Eurosystem monetary policy and intra-day credit operations by the Eurosystem either upon issue or at any or all times during their life. Such recognition will depend upon the European Central Bank being satisfied that the Eurosystem eligibility criteria have been met.] [Whilst the designation is specified as "no" at the Issue Date, should the Eurosystem eligibility criteria be amended in the future such that the Notes are capable of meeting them, the Notes may then be deposited with Euroclear Bank S.A./N.V. or Clearstream Banking S.A as common safekeeper. Note that this does not necessarily mean that the Notes will then be recognised as eligible collateral for Eurosystem monetary policy and intra-day credit operations by the Eurosystem at any time during their life. Such recognition will depend upon the European Central Bank being satisfied that Eurosystem eligibility criteria have been met.]

2 Complete for fixed rate interest bearing Notes only.

3 Complete for floating rate interest bearing Notes only.

4 Complete for floating rate interest bearing Notes only.

5 Complete for interest bearing Notes.

6 Insert "Applicable" or "Not Applicable" as relevant.

7 Insert "Not Applicable" or "Yes" or "No" as relevant.

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1. For value received, [ECOLAB INC. , a corporation organised and existing under the laws of the State of Delaware, having its registered office at 1209 Orange Street, City of Wilmington, Delaware, U.S.A., registered in the State of Delaware under number 0164814 / ECOLAB LUX 1 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.319 / ECOLAB LUX 2 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.318 / ECOLAB NL 10 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56036094 / ECOLAB NL 11 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56150547 ] 8 (the " Issuer ") promises to pay to the bearer of this Global Note on the above-mentioned Maturity Date the above-mentioned Nominal Amount together with interest thereon at the rate and at the times (if any) specified herein.

All such payments shall be made in accordance with an amended and restated note agency agreement dated 9 June 2017 between, among others, the Issuer and the issue and paying agent referred to therein, a copy of which is available for inspection at the offices of Citibank, N.A., London Branch (the " Issue and Paying Agent ") at Citigroup Centre, Canada Square, Canary Wharf, London E14 5LB, United Kingdom, and subject to and in accordance with the terms and conditions set forth below. All such payments shall be made upon presentation and surrender of this Global Note at the offices of the Issue and Paying Agent referred to above by transfer to an account denominated in the Specified Currency maintained by the bearer with (a) a bank in the principal financial centre in the country of the Specified Currency or (b) if this Global Note is denominated or payable in euro, by transfer to a euro account (or any other account to which euro may be credited or transferred) maintained by the payee with, a bank in the principal financial centre of any member state of the European Union. Payments to the bearer of this Global Note shall not be made to an address or a bank account maintained within the United States, the Notes may not be presented for payment within the United States, and demand for payments under the Notes may not be made within the United States.

8 Delete as appropriate.

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2. If this Global Note is not a New Global Note, this Global Note is issued in representation of an issue of Notes in the above-mentioned aggregate Nominal Amount.

3. If this Global Note is a New Global Note, this Global Note is issued in representation of an issue of Notes in an aggregate Nominal Amount as from time to time entered in the records of both Euroclear Bank S.A./N.V. (" Euroclear ") and Clearstream Banking S.A (" Clearstream, Luxembourg "), and/or any such other securities clearance and/or settlement system which is compliant, as of the issue date, with the Market Convention on Short-Term European Paper (" STEP ") dated 19 May 2015 and adopted by the ACI – The Financial Markets Association and the European Money Markets Institute (as amended from time to time) and, if this Global Note indicates that it is intended to be held in a manner which would allow Eurosystem eligibility, authorised to hold, and then currently holding, this Global Note as eligible collateral for Eurosystem monetary policy and intra-day credit operations, in each case as agreed between the Issuer and the Issue and Paying Agent (each an " ICSD " and together, the " ICSDs "). The records of the ICSDs (which expression in this Global Note means the records that each ICSD holds for its customers which reflect the amount of such customers' interests in the Notes (but excluding any interest in any Notes of one ICSD shown in the records of another ICSD), shall be conclusive evidence of the principal amount of Notes represented by this Global Note and, for these purposes, a statement issued by an ICSD (which statement shall be made available to the bearer upon request) stating the principal amount of Notes represented by this Global Note at any time shall be conclusive evidence of the records of the ICSDs at that time.

4. All payments in respect of this Global Note by or on behalf of the Issuer shall be made without set-off, counterclaim, fees, liabilities or similar deductions and free and clear of, and without deduction or withholding for or on account of, taxes, levies, duties, assessments or charges of any nature now or hereafter imposed, levied, collected, withheld or assessed in any jurisdiction through, in or from which such payments are made or any political subdivision or taxing authority of or in any of the foregoing (" Taxes "). If the Issuer or any agent thereof is required by law or regulation to make any deduction or withholding for or on account of Taxes, the Issuer shall, to the extent permitted by applicable law or regulation, pay such additional amounts as shall be necessary in order that the net amounts received by the bearer of this Global Note after such deduction or withholding shall equal the amount which would have been receivable hereunder in the absence of such deduction or withholding, except that no such additional amounts shall be payable where this Global Note is presented for payment:

(a) by or on behalf of a holder which is liable to such Taxes by reason of its having some connection with the jurisdiction imposing the Taxes other than the mere holding of this Global Note; or

(b) more than 15 days after the Maturity Date or, if applicable, the relevant Interest Payment Date or (in either case) the date on which payment hereof is duly provided for, whichever occurs later, except to the extent that the holder would have been entitled to such additional amounts if it had presented this Global Note on the last day of such period of 15 days.

5. The payment obligation of the Issuer represented by this Global Note constitutes and at all times shall constitute a direct and unsecured obligation of the Issuer ranking pari

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passu with all present and future unsecured and unsubordinated indebtedness of the Issuer other than obligations preferred by mandatory provisions of law.

6. If the Maturity Date or, if applicable, the relevant Interest Payment Date is not a Payment Business Day (as defined herein) payment in respect hereof will not be made and credit or transfer instructions shall not be given until the next following Payment Business Day ( provided that , if such postponed payment would have the effect of extending the tenor of the relevant Note to more than 183 days, payment will be made and credit and transfer instructions will be given, on the immediately preceding Payment Business Day) and the bearer of this Global Note shall not be entitled to any adjustment to interest or other sums in respect of such payment.

As used in this Global Note:

" Payment Business Day " means any day other than a Saturday or Sunday which is either (i) if the above-mentioned Specified Currency is any currency other than euro, a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealings in foreign exchange and foreign currency deposits) in the principal financial centre of the country of the relevant Specified Currency or (ii) if the above-mentioned Specified Currency is euro, a day which is a TARGET Business Day; and

" TARGET Business Day " means a day on which the Trans-European Automated Real-time Gross Settlement Express Transfer (TARGET2) System, or any successor thereto, is operating credit or transfer instructions in respect of payments in euro.

Provided that if the Issue and Paying Agent determines with the agreement of the Issuer and the Guarantor that the market practice in respect of euro denominated internationally offered securities is different from that specified above, the above shall be deemed to be amended so as to comply with such market practice and the Issue and Paying Agent shall procure that a notice of such amendment is published not less than 15 days prior to the date on which any payment in euro falls due to be made in such manner as the Issue and Paying Agent may determine.

7. This Global Note is negotiable and, accordingly, title hereto shall pass by delivery and the bearer shall be treated as being absolutely entitled to receive payment upon due presentation hereof (notwithstanding any notation of ownership or other writing thereon or notice of any previous loss or theft thereof).

8. This Global Note is issued in respect of an issue of Notes of the Issuer and is exchangeable in whole (but not in part only) for duly executed and authenticated bearer Notes in definitive form (whether before, on or, subject as provided below, after the Maturity Date) only:

(a) if the clearing system(s) in which this Global Note is held at the relevant time is closed for a continuous period of 14 days or more (other than by reason of weekends or public holidays, statutory or otherwise) or if any such clearing system announces an intention to, or does in fact, permanently cease to do business; or

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(b) if default is made in the payment of any amount payable in respect of this Global Note.

Upon presentation and surrender of this Global Note during normal business hours to the Issuer at the offices of the Issue and Paying Agent (or to any other person or at any other office outside the United States as may be designated in writing by the Issuer to the bearer), the Issue and Paying Agent shall authenticate and deliver, in exchange for this Global Note, bearer definitive notes denominated in the above-mentioned Specified Currency in an aggregate nominal amount equal to the Nominal Amount of this Global Note.

9. If, upon any such default and following such surrender, definitive Notes are not issued in full exchange for this Global Note before 5.00 p.m. (London time) on the thirtieth day after surrender, this Global Note (including the obligation hereunder to issue definitive notes) will become void and the bearer will have no further rights under this Global Note (but without prejudice to the rights which the bearer or any other person may have under a Deed of Covenant dated 9 June 2017 (as amended, restated or supplemented as of the date of issue of the Notes), entered into by the Issuer).

10. [This Global Note has the benefit of a guarantee issued by Ecolab Inc. on 9 June 2017 (as amended, restated or supplemented as of the date of issue of the Notes), copies of which are available for inspection during normal business hours at the office of the Issue and Paying Agent referred to above.] 9

11. If this is an interest bearing Global Note, then:

(a) notwithstanding the provisions of paragraph 0 above, if any payment of interest in respect of this Global Note falling due for payment prior to the above-mentioned Maturity Date remains unpaid on the fifteenth day after falling so due, the amount referred to in paragraph 0 shall be payable on such fifteenth day; and

(b) upon each payment of interest (if any) prior to the Maturity Date in respect of:

(i) this Global Note (if this Global Note is not a New Global Note) the Schedule hereto shall be duly completed by the Issuer and Paying Agent to reflect such payment;

(ii) this Global Note (if the Global Note is a New Global Note) details of such payment shall be entered pro rata in the records of the ICSDs;

(c) payments due in respect of Notes for the time being represented by this Global Note shall be made to the bearer of this Global Note and each payment so made will discharge the Issuer's obligations in respect thereof. Any failure to make the entries referred to in paragraph (b) above shall not affect such discharge; and

9 Delete where Ecolab Inc. is the Issuer, otherwise retain.

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(d) if no Interest Payment Dates are specified on the face of the Global Note, the Interest Payment Date shall be the Maturity Date.

12. If this is a fixed rate interest bearing Global Note, interest shall be calculated on the Nominal Amount as follows:

(a) interest shall be payable on the Nominal Amount in respect of each successive Interest Period (as defined below) from the Issue Date to the Maturity Date only, in arrear on the relevant Interest Payment Date, on the basis of the actual number of days in such Interest Period and a year of 360 days or, if this Global Note is denominated in Sterling, 365 days at the above-mentioned Fixed Interest Rate with the resulting figure being rounded to the nearest amount of the above-mentioned Specified Currency which is available as legal tender in the country or countries (in the case of the euro) of the Specified Currency (with halves being rounded upwards); and

(b) the period beginning on (and including) the Issue Date and ending on (but excluding) the first Interest Payment Date and each successive period beginning on (and including) an Interest Payment Date and ending on (but excluding) the next succeeding Interest Payment Date is an " Interest Period " for the purposes of this paragraph.

13. If this is a floating rate interest bearing Global Note, interest shall be calculated on the Nominal Amount as follows:

(a) in the case of a Global Note which specifies LIBOR as the Reference Rate on its face, the Rate of Interest will be the aggregate of LIBOR and the above-mentioned Margin (if any) above or below LIBOR. Interest shall be payable on the Nominal Amount in respect of each successive Interest Period (as defined below) from the Issue Date to the Maturity Date only, in arrear on the relevant Interest Payment Date, on the basis of the actual number of days in such Interest Period and a year of 360 days or, if this Global Note is denominated in Sterling, 365 days.

As used in this Global Note:

" LIBOR " shall be equal to the rate defined as "LIBOR-BBA" in respect of the above-mentioned Specified Currency (as defined in the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc., as amended, updated or replaced as at the date of this Global Note, (the " ISDA Definitions ")) as at 11.00 a.m. (London time) or as near thereto as practicable on the second London Banking Day before the first day of the relevant Interest Period or, if this Global Note is denominated in Sterling, on the first day thereof (a " LIBOR Interest Determination Date "), as if the Reset Date (as defined in the ISDA Definitions) were the first day of such Interest Period and the Designated Maturity (as defined in the ISDA Definitions) were the number of months specified on the face of this Global Note in relation to the Reference Rate; and

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" London Banking Day " shall mean a day on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency deposits) in London;

(b) in the case of a Global Note which specifies EURIBOR as the Reference Rate on its face, the Rate of Interest will be the aggregate of EURIBOR and the above-mentioned Margin (if any) above or below EURIBOR. Interest shall be payable on the Nominal Amount in respect of each successive Interest Period (as defined below) from the Issue Date to the Maturity Date only, in arrear on the relevant Interest Payment Date, on the basis of the actual number of days in such Interest Period and a year of 360 days.

As used in this Global Note, " EURIBOR " shall be equal to EUR-EURIBOR-Reuters (as defined in the ISDA Definitions) as at 11.00 a.m. (Brussels time) or as near thereto as practicable on the second TARGET Business Day before the first day of the relevant Interest Period (a " EURIBOR Interest Determination Date "), as if the Reset Date (as defined in the ISDA Definitions) was the first day of such Interest Period and the Designated Maturity (as defined in the ISDA Definitions) was the number of months specified on the face of this Global Note in relation to the Reference Rate;

(c) the Calculation Agent will, as soon as practicable after 11.00 a.m. (London time) on each LIBOR Interest Determination Date or 11.00 a.m. (Brussels time) on each EURIBOR Interest Determination Date (as the case may be), determine the Rate of Interest and calculate the amount of interest payable (the " Amount of Interest ") for the relevant Interest Period. " Rate of Interest " means (A) if the Reference Rate is EURIBOR, the rate which is determined in accordance with the provisions of paragraph 13(b), and (B) in any other case, the rate which is determined in accordance with the provisions of paragraph 13(a). The Amount of Interest shall be calculated by applying the Rate of Interest to the Nominal Amount of one Note of each denomination, multiplying such product by the actual number of days in the Interest Period concerned divided by 360 or, if this Global Note is denominated in Sterling, by 365 and rounding the resulting figure to the nearest amount of the above-mentioned Specified Currency which is available as legal tender in the country or countries (in the case of the euro) of the Specified Currency (with halves being rounded upwards). The determination of the Rate of Interest and the Amount of Interest by the Calculation Agent named above shall (in the absence of manifest error) be final and binding upon all parties;

(d) a certificate of the Calculation Agent as to the Rate of Interest payable hereon for any Interest Period shall be conclusive and binding as between the Issuer and the bearer hereof;

(e) the period beginning on (and including) the Issue Date and ending on (but excluding) the first Interest Payment Date and each successive period beginning on (and including) an Interest Payment Date and ending on (but excluding) the next succeeding Interest Payment Date is called an " Interest Period " for the purposes of this paragraph 13; and

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(f) the Issuer will procure that a notice specifying the Rate of Interest payable in respect of each Interest Period be published as soon as practicable after the determination of the Rate of Interest. Such notice will be delivered to the clearing system(s) in which this Global Note is held at the relevant time or, if this Global Note has been exchanged for bearer definitive Notes pursuant to paragraph 8, will be published in a leading English language daily newspaper published in London (which is expected to be the Financial Times ).

14. If the proceeds of this Global Note are accepted in the United Kingdom, the Principal Amount or Minimum Redemption Amount (as applicable) shall be not less than £100,000 (or the equivalent in any other currency).

15. Instructions for payment must be received at the offices of the Issue and Paying Agent referred to above together with this Global Note as follows:

(a) if this Global Note is denominated in Japanese Yen, at least two Business Days prior to the relevant payment date;

(b) if this Global Note is denominated in United States dollars or Sterling, on or prior to the relevant payment date; and

As used in this paragraph, " Business Day " means:

(i) a day other than a Saturday or Sunday on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency deposits) in London; and

(ii) in the case of payments in euro, a TARGET Business Day and, in all other cases, a day on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency deposits) in the principal financial centre in the country of the above-mentioned Specified Currency.

16. If this Global Note is a New Global Note, this Global Note shall not be valid for any purpose until it has been effectuated for and on behalf of the entity appointed as common safekeeper by the ICSDs.

17. This Global Note shall not be validly issued unless manually authenticated by Citibank, N.A., London Branch as Issue and Paying Agent.

18. This Global Note and any non-contractual obligations arising out of or in connection with it are governed by English law. For the avoidance of doubt, the provisions of the Luxembourg law dated 15 August 1915 on commercial companies, as amended, and in particular, sections 86 to 94-8, are hereby excluded.

19.

(a) English courts: The courts of England have exclusive jurisdiction to settle any dispute (a " Dispute ") arising out of or in connection with this Global Note (including a dispute relating to the existence, validity or termination of this

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Global Note or any non-contractual obligation arising out of or in connection with this Global Note) or the consequence of its nullity.

(b) Appropriate forum: The Issuer agrees that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that it will not argue to the contrary.

(c) Rights of the bearer to take proceedings outside England: Clause 19(a) ( English courts ) is for the benefit of the bearer only. As a result, nothing in this Clause 19 prevents the bearer from taking proceedings relating to a Dispute (" Proceedings ") in any other courts with jurisdiction. To the extent allowed by law, the bearer may take concurrent Proceedings in any number of jurisdictions.

(d) Process agent: The Issuer agrees that the documents which start any Proceedings and any other documents required to be served in relation to those Proceedings may be served on it by being delivered to Ecolab Limited at P.O Box 11, Winnington Avenue, Northwich Cheshire, United Kingdom CW8 4DX or, if different, its registered office for the time being or at any address of the Issuer in Great Britain at which process may be served on it in accordance with the Companies Act 2006. If such person is not or ceases to be effectively appointed to accept service of process on behalf of the Issuer, the Issuer shall, on the written demand of the bearer addressed to the Issuer and delivered to the Issuer or to the Specified Office of the Issue and Paying Agent appoint a further person in England to accept service of process on its behalf and, failing such appointment within 15 days, the bearer shall be entitled to appoint such a person by written notice addressed to the Issuer and delivered to the Issuer or to the Specified Office of the Issue and Paying Agent. Nothing in this paragraph shall affect the right of the bearer to serve process in any other manner permitted by law. This clause applies to Proceedings in England and to Proceedings elsewhere.

EACH PARTY WAIVES ANY RIGHT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION IN CONNECTION WITH THIS GLOBAL NOTE OR ANY TRANSACTION CONTEMPLATED BY THIS GLOBAL NOTE. THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO TRIAL BY COURT.

20. No person shall have any right to enforce any provision of this Note under the Contracts (Rights of Third Parties) Act 1999, but this does not affect any right or remedy of a third party which exists or is available apart from that Act.

- 24 -

AUTHENTICATED by	Signed on behalf of:
CITIBANK, N.A., LONDON BRANCH without recourse, warranty or liability and for authentication purposes only	[ECOLAB INC. / ECOLAB LUX 1 S.À R.L. / ECOLAB LUX 2 S.À R.L / ECOLAB NL 10 B.V. / ECOLAB NL 11 B.V.] 10

By: ...............................................................	By: ...............................................................
( Authorised Signatory )	( Authorised Signatory )

10 Delete as appropriate.

- 25 -

SCHEDULE
Payments of Interest

The following payments of interest in respect of this Global Note have been made:

Date Made	Payment From	Payment To	Amount Paid	Notation on behalf of Issue and Paying Agent
_________________	_________________	___________________	_________________	_________________
_________________	_________________	_________________	_________________	_________________
_________________	_________________	_________________	_________________	_________________
_________________	_________________	_________________	_________________	_________________
_________________	_________________	_________________	_________________	_________________

- 26 -

Form of Multicurrency Definitive Note

(Interest Bearing/Discounted/Premium) (Non-Sterling)

[Zero Coupon Notes in definitive form may only be transferred and accepted, directly or indirectly, within, from or into The Netherlands through the mediation of either the relevant Issuer or a member firm of Euronext Amsterdam N.V. admitted in a function on one or more of the markets or systems operated by Euronext Amsterdam N.V. ( toegelaten instelling ) in full compliance with the Dutch Savings Certificates Act ( Wet inzake spaarbewijzen ) of 21 May 1985 (as amended) and its implementing regulations and must either be:

(a) between individuals or legal entities who or which trade or invest in securities in the conduct of a profession or trade (which includes banks, dealers, insurance companies, pension funds, other institutional investors and commercial enterprises which regularly, as an ancillary activity, invest in securities); or, in any other case

(b) recorded in a transaction note which includes the name and address of each party to the transaction, the nature of the transaction and the details and serial number of such Note.

In the event that the Savings Certificates Act applies, certain identification requirements in relation to the issue and transfer of, and payments on, Zero Coupon Notes have to be complied with.

- 27 -

Issuer and on which interest does not become due during their tenor or on which no interest is due whatsoever.] 11

ECOLAB INC.

(incorporated under the laws of the State of Delaware)

ECOLAB LUX 1 S.À R.L.

( incorporated as a private limited liability company (société à responsibilité limitée) for an unlimited duration under the laws of the Grand Duchy of Luxembourg )

ECOLAB LUX 2 S.À R.L.

( incorporated as a private limited liability company (société à responsibilité limitée) for an unlimited duration under the laws of the Grand Duchy of Luxembourg )

ECOLAB NL 10 B.V.

( incorporated as a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under the laws of the Netherlands)

ECOLAB NL 11 B.V.

( incorporated as a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under the laws of the Netherlands)

guaranteed by

ECOLAB INC.

(in respect of Notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.)

No: _________________________________________	Series No.: _________________________________
Issued in London on: _______________________	Maturity Date: _____________________________
Specified Currency: _________________________	Denomination: _____________________________
Nominal Amount: _________________________	Reference Rate: months LIBOR/EURIBOR 12
Fixed Interest Rate: 13 _________________________ % per annum	Margin: 14 _______________________________ %
Calculation Agent: 15 _________________________	Interest Payment Dates: 16 _________________

11 This legend should be placed on zero coupon or discounted Notes and Notes on which interest only becomes due at maturity and which are (a) not listed on the Official Segment of Euronext Amsterdam N.V.'s stock market and (b) issued within The Netherlands, or issued outside The Netherlands but distributed within The Netherlands in the course of initial distribution or immediately thereafter.

12 Complete for fixed rate interest bearing Notes only.

13 Complete for fixed rate interest bearing Notes only.

14 Complete for floating rate interest bearing Notes only.

15 Complete for floating rate Notes only, if the Calculation Agent is not the Issue and Paying Agent.

16 Complete for interest bearing Notes.

- 28 -

1. For value received, [ECOLAB INC. , a corporation organised and existing under the laws of the State of Delaware, having its registered office at 1209 Orange Street, City of Wilmington, Delaware, U.S.A., registered in the State of Delaware under number 0164814 / ECOLAB LUX 1 S.À R.L., a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.319 /ECOLAB LUX 2 S.À R.L., a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.318 / ECOLAB NL 10 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56036094 / ECOLAB NL 11 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56150547 ] 17 (the " Issuer ") promises to pay to the bearer of this Note on the above-mentioned Maturity Date the above-mentioned Nominal Amount together with interest thereon at the rate and at the times (if any) specified herein.

All such payments shall be made in accordance with an amended and restated note agency agreement dated 9 June 2017 between, among others, the Issuer and the issue and paying agent referred to therein, a copy of which is available for inspection at the offices of Citibank, N.A., London Branch (the " Issue and Paying Agent ") at Citigroup Centre, Canada Square, Canary Wharf, London E14 5LB, United Kingdom, and subject to and in accordance with the terms and conditions set forth below. All such payments shall be made upon presentation and surrender of this Note at the offices of the Issue and Paying Agent referred to above by transfer to an account denominated in the Specified Currency maintained by the bearer with (a) a bank in the principal financial centre in the country of the Specified Currency or (b) if this Note is denominated or payable in euro, by transfer to a euro account (or any other account to which euro may be credited or transferred) maintained by the payee with, a bank in the principal financial centre of any member state of the European Union. Payments to the bearer of this Note shall not be made to an address or a bank account maintained within the United States, the Notes may not be presented for payment within the United States, and demand for payments under the Notes may not be made within the United States.

17 Delete as appropriate.

- 29 -

withholding for or on account of Taxes, the Issuer shall, to the extent permitted by applicable law or regulation, pay such additional amounts as shall be necessary in order that the net amounts received by the bearer of this Note after such deduction or withholding shall equal the amount which would have been receivable hereunder in the absence of such deduction or withholding, except that no such additional amounts shall be payable where this Note is presented for payment:

(a) by or on behalf of a holder which is liable to such Taxes by reason of its having some connection with the jurisdiction imposing the Taxes other than the mere holding of this Note; or

3. The payment obligation of the Issuer represented by this Note constitutes and at all times shall constitute a direct and unsecured obligation of the Issuer ranking pari passu with all present and future unsecured and unsubordinated indebtedness of the Issuer other than obligations preferred by mandatory provisions of law.

4. If the Maturity Date or, if applicable, the relevant Interest Payment Date is not a Payment Business Day (as defined herein) payment in respect hereof will not be made and credit or transfer instructions shall not be given until the next following Payment Business Day ( provided that, if such postponed payment would have the effect of extending the tenor of the relevant Note to more than 183 days, payment will be made and credit and transfer instructions will be given, on the immediately preceding Payment Business Day) and the bearer of this Note shall not be entitled to any adjustment to interest or other sums in respect of such payment.

As used in this Note:

" Payment Business Day " means any day other than a Saturday or Sunday which is both (A) a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealings in foreign exchange and foreign currency deposits) in the relevant place of presentation, and (B) either (i) if the above-mentioned Specified Currency is any currency other than euro, a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealings in foreign exchange and foreign currency deposits) in both London and the principal financial centre of the country of the relevant Specified Currency or (ii) if the above-mentioned Specified Currency is euro, a day which is a TARGET Business Day; and

- 30 -

be deemed to be amended so as to comply with such market practice and the Issue and Paying Agent shall procure that a notice of such amendment is published not less than 15 days prior to the date on which any payment in euro falls due to be made in such manner as the Issue and Paying Agent may determine.

5. This Note is negotiable and, accordingly, title hereto shall pass by delivery and the bearer shall be treated as being absolutely entitled to receive payment upon due presentation hereof (notwithstanding any notation of ownership or other writing thereon or notice of any previous loss or theft thereof).

6. [This Note has the benefit of a guarantee issued by Ecolab Inc. on 9 June 2017 (as amended, restated or supplemented as of the date of issue of the Notes), copies of which are available for inspection during normal business hours at the office of the Issue and Paying Agent referred to above.] 18

7. If this is an interest bearing Note, then:

(a) notwithstanding the provisions of paragraph 1 above, if any payment of interest in respect of this Note falling due for payment prior to the above-mentioned Maturity Date remains unpaid on the fifteenth day after falling so due, the amount referred to in paragraph 1 shall be payable on such fifteenth day;

(b) upon each payment of interest (if any) prior to the Maturity Date in respect of this Note, the Schedule hereto shall be duly completed by the Issue and Paying Agent to reflect such payment;

(c) payments due in respect of Notes for the time being represented by this Note shall be made to the bearer of this Note and each payment so made will discharge the Issuer's obligations in respect thereof. Any failure to make the entries referred to in sub-paragraph (b) above shall not affect such discharge; and

(d) if no Interest Payment Dates are specified on the face of the Note, the Interest Payment Date shall be the Maturity Date.

8. If this is a fixed rate interest bearing Note, interest shall be calculated on the Nominal Amount as follows:

(a) interest shall be payable on the Nominal Amount in respect of each successive Interest Period (as defined below) from the Issue Date to the Maturity Date only, in arrear on the relevant Interest Payment Date, on the basis of the actual number of days in such Interest Period and a year of 360 days at the above-mentioned Fixed Interest Rate with the resulting figure being rounded to the nearest amount of the above-mentioned Specified Currency which is available as legal tender in the country or countries (in the case of the euro) of the Specified Currency (with halves being rounded upwards); and

(b) the period beginning on (and including) the Issue Date and ending on (but excluding) the first Interest Payment Date and each successive period beginning

18 Delete where Ecolab Inc. is the Issuer, otherwise retain.

- 31 -

on (and including) an Interest Payment Date and ending on (but excluding) the next succeeding Interest Payment Date is an " Interest Period " for the purposes of this paragraph.

9. If this is a floating rate interest bearing Note, interest shall be calculated on the Nominal Amount as follows:

(a) in the case of a Note which specifies LIBOR as the Reference Rate on its face, the Rate of Interest will be the aggregate of LIBOR and the above-mentioned Margin (if any) above or below LIBOR. Interest shall be payable on the Nominal Amount in respect of each successive Interest Period (as defined below) from the Issue Date to the Maturity Date only, in arrear on the relevant Interest Payment Date, on the basis of the actual number of days in such Interest Period and a year of 360 days.

As used in this Note:

" LIBOR " shall be equal to the rate defined as "LIBOR-BBA" in respect of the above-mentioned Specified Currency (as defined in the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc., as amended, updated or replaced as at the date of this Note, (the " ISDA Definitions ")) as at 11.00 a.m. (London time) or as near thereto as practicable on the second London Banking Day before the first day of the relevant Interest Period (a " LIBOR Interest Determination Date "), as if the Reset Date (as defined in the ISDA Definitions) were the first day of such Interest Period and the Designated Maturity (as defined in the ISDA Definitions) were the number of months specified on the face of this Note in relation to the Reference Rate; and

" London Banking Day " shall mean a day on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency deposits) in London;

(b) in the case of a Note which specifies EURIBOR as the Reference Rate on its face, the Rate of Interest will be the aggregate of EURIBOR and the above-mentioned Margin (if any) above or below EURIBOR. Interest shall be payable on the Nominal Amount in respect of each successive Interest Period (as defined below) from the Issue Date to the Maturity Date only, in arrear on the relevant Interest Payment Date, on the basis of the actual number of days in such Interest Period and a year of 360 days.

As used in this Note, " EURIBOR " shall be equal to EUR-EURIBOR-Reuters (as defined in the ISDA Definitions) as at 11.00 a.m. (Brussels time) or as near thereto as practicable on the second TARGET Business Day before the first day of the relevant Interest Period (a " EURIBOR Interest Determination Date "), as if the Reset Date (as defined in the ISDA Definitions) were the first day of such Interest Period and the Designated Maturity (as defined in the ISDA Definitions) were the number of months specified on the face of this Note in relation to the Reference Rate;

- 32 -

(c) the Calculation Agent will, as soon as practicable after 11.00 a.m. (London time) on each LIBOR Interest Determination Date or 11.00 a.m. (Brussels time) on each EURIBOR Interest Determination Date (as the case may be), determine the Rate of Interest and calculate the amount of interest payable (the " Amount of Interest ") for the relevant Interest Period. " Rate of Interest " means (A) if the Reference Rate is EURIBOR, the rate which is determined in accordance with the provisions of paragraph 8(b), and (B) in any other case, the rate which is determined in accordance with the provisions of paragraph 8(a). The Amount of Interest shall be calculated by applying the Rate of Interest to the Nominal Amount of one Note of each denomination, multiplying such product by the actual number of days in the Interest Period concerned divided by 360 and rounding the resulting figure to the nearest amount of the above-mentioned Specified Currency which is available as legal tender in the country or countries (in the case of the euro) of the Specified Currency (with halves being rounded upwards). The determination of the Rate of Interest and the Amount of Interest by the Calculation Agent named above shall (in the absence of manifest error) be final and binding upon all parties;

(d) a certificate of the Calculation Agent as to the Rate of Interest payable hereon for any Interest Period shall be conclusive and binding as between the Issuer and the bearer hereof;

(f) the Issuer will procure that a notice specifying the Rate of Interest payable in respect of each Interest Period be published as soon as practicable after the determination of the Rate of Interest. Such notice will be delivered to the bearer of this Note, or if that is not practicable, will be published in a leading English language daily newspaper published in London (which is expected to be the Financial Times ).

10. If the proceeds of this Note are accepted in the United Kingdom, the Principal Amount or Minimum Redemption Amount (as applicable) shall be not less than £100,000 (or the equivalent in any other currency).

11. Instructions for payment must be received at the offices of the Issue and Paying Agent referred to above together with this Note as follows:

(a) if this Note is denominated in Japanese Yen, at least two Business Days prior to the relevant payment date;

(b) if this Note is denominated in United States dollars, on or prior to the relevant payment date; and

- 33 -

As used in this paragraph, " Business Day " means:

(i) a day other than a Saturday or Sunday on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency deposits) in London; and

12. This Note shall not be validly issued unless manually authenticated by Citibank, N.A., London Branch as Issue and Paying Agent.

13. This Note and any non-contractual obligations arising out of or in connection with it are governed by English law. For the avoidance of doubt, the provisions of the Luxembourg law dated 15 August 1915 on commercial companies, as amended, and in particular, sections 86 to 94-8, are hereby excluded.

14.

(a) English courts: The courts of England have exclusive jurisdiction to settle any dispute (a " Dispute ") arising from or connected with this Note (including a dispute relating to the existence, validity or termination of this Note or any non-contractual obligation arising out of or in connection with this Note) or the consequence of its nullity.

(b) Appropriate forum: The Issuer agrees that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that it will not argue to the contrary.

(c) Rights of the bearer to take proceedings outside England: Clause 14(a) ( English courts ) is for the benefit of the bearer only. As a result, nothing in this Clause 14 prevents the bearer from taking proceedings relating to a Dispute (" Proceedings ") in any other courts with jurisdiction. To the extent allowed by law, the bearer may take concurrent Proceedings in any number of jurisdictions.

(d) Process agent: The Issuer agrees that the documents which start any Proceedings and any other documents required to be served in relation to those Proceedings may be served on it by being delivered to Ecolab Limited at P.O. Box 11, Winnington Avenue, Northwich, Cheshire, United Kingdom CW8 4DX or, if different, its registered office for the time being or at any address of the Issuer in Great Britain at which process may be served on it in accordance with the Companies Act 2006. If such person is not or ceases to be effectively appointed to accept service of process on behalf of the Issuer, the Issuer shall, on the written demand of the bearer addressed to the Issuer and delivered to the Issuer or to the Specified Office of the Issue and Paying Agent appoint a further person in England to accept service of process on its behalf and, failing such appointment within 15 days, the bearer shall be entitled to appoint such a person by written notice addressed to the Issuer and delivered to the Issuer or to the

- 34 -

Specified Office of the Issue and Paying Agent. Nothing in this paragraph shall affect the right of the bearer to serve process in any other manner permitted by law. This Clause applies to Proceedings in England and to Proceedings elsewhere.

EACH PARTY WAIVES ANY RIGHT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION IN CONNECTION WITH THIS NOTE OR ANY TRANSACTION CONTEMPLATED BY THIS NOTE. THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO TRIAL BY COURT.

15. No person shall have any right to enforce any provision of this Note under the Contracts (Rights of Third Parties) Act 1999, but this does not affect any right or remedy of a third party which exists or is available apart from that Act.

AUTHENTICATED by	Signed on behalf of:
CITIBANK, N.A., LONDON BRANCH	[ECOLAB INC. / ECOLAB LUX 1 S.À R.L. / ECOLAB LUX 2 S.À R.L. / ECOLAB NL 10 B.V. / ECOLAB NL 11 B.V.] 19
without recourse, warranty or liability and for authentication purposes only

By: .........................................................	By: .........................................................
( Authorised Signatory )	( Authorised Signatory )

19 Delete as appropriate.

- 35 -

SCHEDULE

PAYMENTS OF INTEREST

The following payments of interest in respect of this Note have been made:

Date Made	Payment From	Payment To	Amount Paid	Notation on behalf of Issue and Paying Agent

- 36 -

Form of Definitive Note

(for use where the Issuer accepts the proceeds of issue in the United Kingdom)

Zero Coupon Notes in definitive form may only be transferred and accepted, directly or indirectly, within, from or into The Netherlands through the mediation of either the relevant Issuer or a member firm of Euronext Amsterdam N.V. admitted in a function on one or more of the markets or systems operated by Euronext Amsterdam N.V. ( toegelaten instelling ) in full compliance with the Dutch Savings Certificates Act ( Wet inzake spaarbewijzen ) of 21 May 1985 (as amended) and its implementing regulations and must either be:

(b) recorded in a transaction note which includes the name and address of each party to the transaction, the nature of the transaction and the details and serial number of such Note.

In the event that the Savings Certificates Act applies, certain identification requirements in relation to the issue and transfer of, and payments on, Zero Coupon Notes have to be complied with.

As used herein, "Zero Coupon Notes" has the meaning given to it in Section 1(a) of the Dutch Savings Certificates Act ( Wet inzake spaarbewijzen ) of 21 May 1985 (as amended), being Notes that are in bearer form and that constitute a claim for a fixed sum against the relevant

- 37 -

Issuer and on which interest does not become due during their tenor or on which no interest is due whatsoever.] 20

£[100,000][500,000][1,000,000]

20 This legend should be placed on zero coupon or discounted Notes and Notes on which interest only becomes due at maturity and which are (a) not listed on the Official Segment of Euronext Amsterdam N.V.'s stock market and (b) issued within The Netherlands, or issued outside The Netherlands but distributed within The Netherlands in the course of initial distribution or immediately thereafter.

- 38 -

ECOLAB INC.

(incorporated under the laws of the State of Delaware)

ECOLAB LUX 1 S.À R.L.

( incorporated as a private limited liability company (société à responsibilité limitée) for an unlimited duration under the laws of the Grand Duchy of Luxembourg )

ECOLAB LUX 2 S.À R.L.

( incorporated as a private limited liability company (société à responsibilité limitée) for an unlimited duration under the laws of the Grand Duchy of Luxembourg )

ECOLAB NL 10 B.V.

( incorporated as a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under the laws of the Netherlands)

ECOLAB NL 11 B.V.

( incorporated as a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under the laws of the Netherlands)

guaranteed by

ECOLAB INC.

(in respect of Notes issued by Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V.)

No: _________________________________________	Series No.: _________________________________
Issued in London on: _______________________	Maturity Date: _____________________________
Denomination: _____________________________	Nominal Amount: __________________
Reference Rate: 21 ___ months LIBOR	Calculation Agent: 22
Fixed Interest Rate: 23 %per annum
Margin: 24 _____________________________________ %	Interest Payment Dates: 25 _____________________

21 Complete for floating rate interest bearing Notes only.

22 Complete for floating rate Notes only, if the Calculation Agent is not the Issue and Paying Agent.

23 Complete for fixed rate interest bearing Notes only.

24 Complete for floating rate interest bearing Notes only.

25 Complete for interest bearing Notes if interest is payable before the Maturity Date.

- 39 -

of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.319 /ECOLAB LUX 2 S.À R.L. , a private limited liability company ( societé à responsabilité limitée ) incorporated and existing under the laws of Luxembourg, having its registered office at 6, rue Eugène Ruppert, L-2453 Luxembourg, the Grand Duchy of Luxembourg and registered with the Luxembourg Register of Commerce and Companies under number B 132.318 / ECOLAB NL 10 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56036094 / ECOLAB NL 11 B.V. , a private limited liability company ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56150547 ] 26 (the " Issuer ") promises to pay to the bearer of this Note on the above-mentioned Maturity Date the above-mentioned Nominal Amount together with interest thereon at the rate and at the times (if any) specified on the reverse of this Note.

All such payments shall be made in accordance with an amended and restated note agency agreement dated 9 June 2017 between, among others, the Issuer and the issue and paying agent referred to therein, a copy of which is available for inspection at the offices of Citibank, N.A., London Branch (the " Issue and Paying Agent ") at Citigroup Centre, Canada Square, Canary Wharf, London E14 5LB, United Kingdom, and subject to and in accordance with the terms and conditions set forth below. All such payments shall be made upon presentation and surrender of this Note at the offices of the Issue and Paying Agent referred to above by transfer to a sterling account maintained by the bearer. Payments to the bearer of this Note shall not be made to an address or a bank account maintained within the United States, the Notes may not be presented for payment within the United States, and demand for payments under the Notes may not be made within the United States.

2. All payments in respect of this Note by or on behalf of the Issuer shall be made without set-off, counterclaim, fees, liabilities or similar deductions and free and clear of, and without deduction or withholding for or on account of, taxes, levies, duties, assessments or charges of any nature now or hereafter imposed, levied, collected, withheld or assessed in any jurisdiction through, in or from which such payments are made or any political subdivision or taxing authority of or in any of the foregoing (" Taxes "). If the Issuer or any agent thereof is required by law or regulation to make any deduction or withholding for or on account of Taxes, the Issuer shall, to the extent permitted by applicable law or regulation, pay such additional amounts as shall be necessary in order that the net amounts received by the bearer of this Note after such deduction or withholding shall equal the amount which would have been receivable hereunder in the absence of such deduction or withholding, except that no such additional amounts shall be payable where this Note is presented for payment:

26 Delete as appropriate.

- 40 -

(a) by or on behalf of a holder which is liable to such Taxes by reason of its having some connection with the jurisdiction imposing the Taxes other than the mere holding of this Note; or

6. This Note shall not be validly issued unless manually authenticated by Citibank, N.A., London Branch as Issue and Paying Agent.

7. This Note and any non-contractual obligations arising out of or in connection with it are governed by English law. For the avoidance of doubt, the provisions of the Luxembourg law dated 15 August 1915 on commercial companies, as amended, and in particular, sections 86 to 94-8, are hereby excluded.

8. If the proceeds of this Note are accepted in the United Kingdom, the Principal Amount or Minimum Redemption Amount (as applicable) shall be not less than £100,000 (or the equivalent in any other currency).

9. [This Note has the benefit of a guarantee issued by Ecolab Inc. on [•] 2017 (as amended, restated or supplemented as of the date of issue of the Notes), copies of which are available for inspection during normal business hours at the office of the Issue and Paying Agent referred to above.] 27

27 Delete where Ecolab Inc. is the Issuer, otherwise retain.

- 41 -

10.

(b) Appropriate forum: The Issuer agrees that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that it will not argue to the contrary.

(c) Rights of the bearer to take proceedings outside England: Clause 10(a) ( English courts ) is for the benefit of the bearer only. As a result, nothing in this Clause 10 prevents the bearer from taking proceedings relating to a Dispute (" Proceedings ") in any other courts with jurisdiction. To the extent allowed by law, the bearer may take concurrent Proceedings in any number of jurisdictions.

(d) Process agent: The Issuer agrees that the documents which start any Proceedings and any other documents required to be served in relation to those Proceedings may be served on it by being delivered to Ecolab Limited at P.O. Box 11, Winnington Avenue, Northwich, Cheshire, United Kingdom CW8 4DX or, if different, its registered office for the time being or at any address of the Issuer in Great Britain at which process may be served on it in accordance with the Companies Act 2006. If such person is not or ceases to be effectively appointed to accept service of process on behalf of the Issuer, the Issuer shall, on the written demand of the bearer addressed to the Issuer and delivered to the Issuer or to the Specified Office of the Issue and Paying Agent appoint a further person in England to accept service of process on its behalf and, failing such appointment within 15 days, the bearer shall be entitled to appoint such a person by written notice addressed to the Issuer and delivered to the Issuer or to the Specified Office of the Issue and Paying Agent. Nothing in this paragraph shall affect the right of the bearer to serve process in any other manner permitted by law. This Clause applies to Proceedings in England and to Proceedings elsewhere.

11. No person shall have any right to enforce any provision of this Note under the Contracts (Rights of Third Parties) Act 1999, but this does not affect any right or remedy of a third party which exists or is available apart from that Act.


AUTHENTICATED by	Signed on behalf of:
CITIBANK, N.A., LONDON BRANCH	[ECOLAB INC. / ECOLAB LUX 1 S.À R.L. / ECOLAB LUX 2 S.À R.L. / ECOLAB NL 10 B.V. / ECOLAB NL 11 B.V.] 28

- 42 -

without recourse, warranty or liability and for authentication purposes only

By: .........................................................	By: .........................................................
( Authorised Signatory )	( Authorised Signatory )

By: .........................................................	By: .........................................................
( Authorised Signatory )	( Authorised Signatory )

28 Delete as appropriate.

- 43 -

On the Reverse]

(A) If this is an interest bearing Note, then:

(b) upon each payment of interest (if any) prior to the Maturity Date in respect of this Note, the Schedule hereto shall be duly completed by the Issue and Paying Agent to reflect such payment;

(c) if no Interest Payment Dates are specified on the face of the Note, the Interest Payment Date shall be the Maturity Date.

(B) If this is a fixed rate interest bearing Note, interest shall be calculated on the Nominal Amount as follows:

(a) the Rate of Interest will be the aggregate of LIBOR and the above-mentioned Margin (if any) above or below LIBOR. Interest shall be payable on the Nominal Amount in respect of each successive Interest Period (as defined below) from the Issue Date to the Maturity Date only, in arrear on the relevant Interest Payment Date, on the basis of the actual number of days in such Interest Period and a year of 365 days. As used in this Note, "LIBOR" shall be equal to the rate defined as "LIBOR-BBA" in respect of Sterling (as defined in the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc., as amended, updated or replaced as at the date of this Note (the " ISDA Definitions ")) as at 11.00 a.m. (London time) or as near thereto as

- 44 -

practicable on the first day of the relevant Interest Period (the " LIBOR Interest Determination Date "), as if the Reset Date (as defined in the ISDA Definitions) were the first day of such Interest Period and the Designated Maturity (as defined in the ISDA Definitions) were the number of months specified on the face of this Note in relation to the Reference Rate;

(b) the Calculation Agent will, as soon as practicable after 11.00 a.m. (London time) on the LIBOR Interest Determination Date, determine the Rate of Interest and calculate the amount of interest payable (the " Amount of Interest ") for the relevant Interest Period. " Rate of Interest " means the rate which is determined in accordance with the provisions of sub-paragraph (a) above. The Amount of Interest shall be calculated by applying the Rate of Interest to the Nominal Amount of one Note of each denomination, multiplying such product by the actual number of days in the Interest Period concerned divided by 365 and rounding the resulting figure to the nearest penny. The determination of the Rate of Interest and the Amount of Interest by the Calculation Agent named above shall (in the absence of manifest error) be final and binding upon all parties;

(c) a certificate of the Calculation Agent as to the Rate of Interest payable hereon for any Interest Period shall be conclusive and binding as between the Issuer and the bearer hereof;

(d) the period beginning (and including) on the Issue Date and ending on (but excluding) the first Interest Payment Date and each successive period beginning on (and including) an Interest Payment Date and ending on (but excluding) the next succeeding Interest Payment Date is called an " Interest Period " for the purposes of this paragraph (C).

- 45 -

SCHEDULE

PAYMENTS OF INTEREST

The following payments of interest in respect of this Note have been made:

Date Made	Payment From	Payment To	Amount Paid	Notation on behalf of Issue and Paying Agent

SCHEDULE 2

DUTIES UNDER THE ISSUER-ICSDS AGREEMENT

In relation to each tranche of Notes that are, or are to be, represented by a New Global Note the Agent will comply with the following provisions:

 Initial issue outstanding amount : The Agent will inform each of the ICSDs, through the common service provider appointed by the ICSDs to service the Notes (the " Common Service Provider "), of the initial issue outstanding amount (the " IOA ") for such tranche on or prior to the relevant issue date.

 Mark up or mark down : If any event occurs that requires a mark up or mark down of the records which an ICSD holds for its customers to reflect such customers' interest in the Notes, the Agent will (to the extent known to it) promptly provide details of the amount of such mark up or mark down, together with a description of the event that requires it, to the ICSDs (through the Common Service Provider) to ensure that the IOA of the Notes remains at all times accurate.

 Reconciliation of records : The Agent will at least once every month reconcile its record of the IOA of the Notes with information received from the ICSDs (through the Common Service Provider) with respect to the IOA maintained by the ICSDs for the

- 46 -

Notes and will promptly inform the ICSDs (through the Common Service Provider) of any discrepancies.

 Resolution of discrepancies : The Agent will promptly assist the ICSDs (through the Common Service Provider) in resolving any discrepancy identified in the IOA of the Notes.

 Details of payments : The Agent will promptly provide the ICSDs (through the Common Service Provider) details of all amounts paid by it under the Notes (or, where the Notes provide for delivery of assets other than cash, of the assets so delivered).

 Change of amount : The Agent will (to the extent known to it) promptly provide to the ICSDs (through the Common Service Provider) notice of any changes to the Notes that will affect the amount of, or date for, any payment due under the Notes.

 Notices to holders : The Agent will (to the extent known to it) promptly provide to the ICSDs (through the Common Service Provider) copies of all information that is given to the holders of the Notes.

 Communications from ICSDs : The Agent will promptly pass on to the relevant Issuer all communications it receives from the ICSDs directly or through the Common Service Provider relating to the Notes.

 Default : The Agent will (to the extent known to it) promptly notify the ICSDs (through the Common Service Provider) of any failure by the relevant Issuer to make any payment or delivery due under the Notes when due.

- 47 -

SIGNATURE PAGES

The Issuers

ECOLAB INC.


By:	/s/ Kristen Bettmann

Address:	1 Ecolab Place
	St. Paul
	MN 55102
	U.S.A.
Telephone:	+1 800 232 6522
Facsimile:	+1 651 250 2573
Attention:	General Counsel

ECOLAB LUX 1 S.À R.L.

By:	/s/ Kristen Bettmann

Address:	6, rue Eugène Ruppert,
	L-2453 Luxembourg
	Grand Duchy of Luxembourg
Telephone:	+ 352 26 449 379
Facsimile:	+ 352 26 449 167
Attention:	Manager
(cc. Ecolab Inc. as specified above)

ECOLAB LUX 2 S.À R.L.

By:	/s/ Kristen Bettmann

Address:	6, rue Eugène Ruppert,
	L-2453 Luxembourg
	Grand Duchy of Luxembourg
Telephone:	+ 352 26 449 379
Facsimile:	+ 352 26 449 167
Attention:	Manager
(cc. Ecolab Inc. as specified above)

ECOLAB NL 10 B.V.

By:	/s/ Kristen Bettmann

Address:	Iepenhoeve 7 A
	3438MR Nieuwegein
	The Netherlands
Telephone:	+31 30 608 2372
Facsimile:	+31 30 608 2228
Attention:	Director
(cc. Ecolab Inc. as specified above)

ECOLAB NL 11 B.V.

By:	/s/ Kristen Bettmann

Address:	Iepenhoeve 7 A
	3438MR Nieuwegein
	The Netherlands
Telephone:	+31 30 608 2222
Facsimile:	+31 30 608 2228
Attention:	Director
(cc. Ecolab Inc. as specified above)

The Guarantor

ECOLAB INC.


By:	/s/ Kristen Bettmann

Address:	1 Ecolab Place
	St. Paul
	MN 55102
	U.S.A.
Telephone:	+1 800 232 6522
Facsimile:	+1 651 250 2573
Attention:	General Counsel

The Agent

CITIBANK, N.A., LONDON BRANCH


By:	/s/ Beth Kuhn

Address:	Citigroup Centre
	Canada Square
	Canary Wharf
	London E14 5LB
	United Kingdom
Telephone:	+353 1 622 2238
Facsimile:	+353 1 622 4029
Attention:	ECP Issuance Desk


	CLIFFORD CHANCE LLP
	Exhibit 10.1.C


		Execution version



ECOLAB INC. ECOLAB LUX 1 S.À R.L. ECOLAB LUX 2 S.À R.L. ECOLAB NL 10 B.V. ECOLAB NL 11 B.V. as Issuers U.S.$2,000,000,000 EURO-COMMERCIAL PAPER PROGRAMME
	DEED OF COVENANT

87441-3-18476-v2.0
87441-3-18476-v2.0		70-40653649

CONTENTS

Clause

Page

1.	Interpretation	2
2.	Direct Rights	3
3.	Evidence	3
4.	Deposit of Deed of Covenant	4
5.	Stamp Duties	4
6.	Benefit of Deed of Covenant	4
7.	Partial Invalidity	5
8.	Notices	5
9.	Law and Jurisdiction	6

87441-3-18476-v2.0

70-40653649

THIS DEED OF COVENANT is made on

(1)

ECOLAB INC. ; a corporation organised and existing under the laws of the State of Delaware, having its registered office at 1209 Orange Street, City of Wilmington, Delaware, U.S.A., registered in the State of Delaware under number 0164814;

(2)

(3)

(4)

ECOLAB NL 10 B.V. , a private limited liability company (b esloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56036094; and

(5)

ECOLAB NL 11 B.V. , a private limited liability company (b esloten vennootschap met beperkte aansprakelijkheid ) incorporated and existing under the laws of The Netherlands, having its registered office at Iepenhoeve 7 A, 3438MR Nieuwegein, The Netherlands and registered in The Netherlands under number 56150547,

(each of Ecolab Lux 1 S.à r.l., Ecolab Lux 2 S.à r.l., Ecolab NL 10 B.V. and Ecolab NL 11 B.V. is referred to herein as an " Issuer " and together, the " Issuers ");

IN FAVOUR OF

(6)

THE ACCOUNTHOLDERS (as defined below).

WHEREAS

(A)

The Issuers and Ecolab Inc., in its capacity as guarantor, have established a Euro Commercial Paper Programme (the " Programme ") for the issuance of notes (the " Notes "), in connection with which they have entered into an amended and restated dealer agreement dated the date of this Deed of Covenant (the " Dealer Agreement ") and an amended and restated note agency agreement dated the date of this Deed of Covenant (the " Agency Agreement ").

(B)

The Issuers wish to make certain arrangements for the Accountholders in the event that any Global Note (as defined in the Dealer Agreement) becomes void in accordance with its terms.

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NOW THIS DEED OF COVENANT witnesses as follows:

INTERPRETATION

1.1

Definitions

All terms and expressions which have defined meanings in the Dealer Agreement or the Agency Agreement shall have the same meanings in this Deed of Covenant except where the context requires otherwise or unless otherwise stated. In addition, in this Deed of Covenant the following expressions have the following meanings:

" Accountholder " means any accountholder with a Clearing System which at the Determination Date has credited to its securities account with such Clearing System one or more Entries in respect of a Global Note, except for any Clearing System in its capacity as an accountholder of another Clearing System.

" Clearing System " means each or any of Clearstream Banking, société anonyme Euroclear Bank S.A./N.V. or such other clearing system as may be agreed from time to time between the Issuers and the Agent and in which Notes may from time to time be held, or any successor to such entities.

" Determination Date " means, in relation to any Global Note, the date on which such Global Note becomes void in accordance with its terms.

" Direct Rights " means the rights referred to in Clause ‎ 2.1 ( Direct Rights - Creation ).

" Entry " means, in relation to a Global Note, any entry which is made in the securities account of any Accountholder with a Clearing System in respect of Notes represented by such Global Note.

" Principal Amount " means, in respect of any Entry, the aggregate principal amount of the Notes to which such Entry relates.

1.2 Clauses

Any reference in this Deed of Covenant to a Clause is, unless otherwise stated, to a clause hereof.

1.3 Other agreements

All references in this Deed of Covenant to an agreement, instrument or other document (including the Dealer Agreement and the Agency Agreement) shall be construed as a reference to that agreement, instrument or other document as the same may be amended, supplemented, replaced or novated from time to time.

1.4 Legislation

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1.5 Headings

Headings and sub-headings are for ease of reference only and shall not affect the construction of this Deed of Covenant.

1.6 Benefit of Deed of Covenant

Any Notes issued under the Programme on or after the date of this Deed of Covenant shall have the benefit of this Deed of Covenant but shall not have the benefit of any subsequent deed of covenant relating to the Programme (unless expressly so provided in any such subsequent deed).

DIRECT RIGHTS

2.1

Creation

If any Global Note becomes void in accordance with its terms, each Accountholder shall have against the relevant Issuer all rights (" Direct Rights ") which such Accountholder would have had in respect of the Notes if, immediately before the Determination Date in relation to that Global Note, it had been the holder of Definitive Notes, duly executed, authenticated and issued, in an aggregate principal amount equal to the Principal Amount of such Accountholder's Entries relating to such Global Note including (without limitation) the right to receive all payments due at any time in respect of such Definitive Notes as if such Definitive Notes had been duly presented and (in the case of final redemption of a Definitive Note) surrendered on the due date in accordance with the terms and conditions of such Note.

2.2

No Further Action

No further action shall be required on the part of the relevant Issuer or any other person:

2.2.1

Direct Rights: for the Accountholders to enjoy the Direct Rights; or

2.2.2

Benefit of terms and conditions: for each Accountholder to have the benefit of the terms and conditions of the Notes represented by the Global Note as if they had been incorporated mutatis mutandis into this Deed of Covenant,

provided , however , that nothing herein shall entitle any Accountholder to receive any payment in respect of any Global Note which has already been made.

EVIDENCE

3.1

Records

The records of the Clearing Systems shall be conclusive as to the identity of the Accountholders and the respective amounts of Notes credited to their securities accounts and a statement issued by a Clearing System setting out:

3.1.1

Name: the name of the Accountholder in respect of which it is issued; and

3.1.2

Principal Amount: the Principal Amount of any Entry credited to the securities account of such Accountholder with such Clearing System on any date,

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shall be conclusive evidence for all purposes of this Deed of Covenant.

3.2

Determination Date

If a Clearing System determines the Determination Date, such determination shall be binding on all Accountholders with such Clearing System.

DEPOSIT OF DEED OF COVENANT

This Deed of Covenant shall be deposited with and held by the Issue and Paying Agent for so long as the Programme remains in effect and thereafter until the date on which all the obligations of the Issuers under or in respect of the Notes (including, without limitation, its obligations under this Deed of Covenant) have been discharged in full. The Issuers hereby acknowledge the right of every Accountholder to the production of this Deed of Covenant.

STAMP DUTIES

The Issuers shall pay all stamp, registration and other similar taxes and duties (including any interest and penalties thereon or in connection therewith) which may be payable upon or in connection with the execution and delivery of this Deed of Covenant, except for any taxes payable regarding Luxembourg registration duties ( droits d'enregistrement ) due to a registration, submission or filing of this Deed of Covenant where such registration, submission or filing is or was not required to maintain or preserve the rights of the Accountholders under this Deed of Covenant and shall indemnify each Accountholder against any claim, demand, action, liability, damages, cost, loss or expense (including (i) an amount equal to any United Kingdom value added tax but only to the extent such Accountholder, or any member of the group to which that Accountholder belongs for value added tax purposes, reasonably determines that it is not entitled to recover (whether by credit or repayment) such value added tax and (ii) fees and disbursements of counsel to such Accountholder) which it may incur or which may be made against it as a result or arising out of or in relation to any failure to pay or delay in paying any of the same.

BENEFIT OF DEED OF COVENANT

6.1

Deed Poll

This Deed of Covenant shall take effect as a deed poll for the benefit of the Accountholders from time to time.

6.2

Benefit

This Deed of Covenant shall enure to the benefit of each Accountholder and its (and any subsequent) successors and assigns, each of which shall be entitled severally to enforce this Deed of Covenant against the relevant Issuer.

6.3

Assignment

The Issuers shall not be entitled to assign or transfer all or any of their rights, benefits and obligations hereunder. Each Accountholder shall be entitled to assign all or any of its rights and benefits hereunder.

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PARTIAL INVALIDITY

If at any time any provision hereof is or becomes illegal, invalid or unenforceable in any respect under the laws of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions hereof nor the legality, validity or enforceability of such provision under the laws of any other jurisdiction shall in any way be affected or impaired thereby.

NOTICES

8.1

Address for notices

All notices and other communications to the Issuers hereunder shall be made in writing (by letter or fax) and shall be sent to the relevant Issuer at:

For Ecolab Inc.:

1 Ecolab Place

St. Paul

MN 55102

U.S.A.

Fax: +1 651 250 2573

Attention: General Counsel

For Ecolab Lux 1 S.à r.l.:

6, rue Eugène Ruppert

L-2453 Luxembourg

Grand Duchy of Luxembourg

Fax: + 352 26 449 379

Attention: Manager

(cc. Ecolab Inc. as specified above)

For Ecolab Lux 2 S.à r.l.:

6, rue Eugène Ruppert

L-2453 Luxembourg

Grand Duchy of Luxembourg

Fax: + 352 26 449 379

Attention: Manager

(cc. Ecolab Inc. as specified above)

87441-3-18476-v2.0
87441-3-18476-v2.0	- 5 -	70-40653649

For Ecolab NL 10 B.V.:

Iepenhoeve 7 A

3438MR Nieuwegein

The Netherlands

Fax: +31 (0)30 6082372

Attention: Director

For Ecolab NL 11 B.V.:

Iepenhoeve 7 A

3438MR Nieuwegein

The Netherlands

Fax: +31 (0)30 6082222

Attention: Director

(cc. Ecolab Inc. as specified above)

or to such other address, telex number or fax number or for the attention of such other person or department as the relevant Issuer has notified to the Accountholders.

8.2

Effectiveness

Every notice or other communication sent in accordance with Clause ‎8.1 ( Address for notices ) shall be effective upon receipt by the relevant Issuer provided , however , that any such notice or other communication which would otherwise take effect after 4.00 p.m. on any particular day shall not take effect until 10.00 a.m. on the immediately succeeding business day in the place of the relevant Issuer.

LAW AND JURISDICTION

9.1

Governing law

This Deed of Covenant and any non-contractual obligations arising out of or in connection with it are governed by English law.

9.2

English courts

The courts of England have exclusive jurisdiction to settle any dispute (a " Dispute "), arising from or connected with this Deed of Covenant (including a dispute regarding the existence, validity or termination of this Deed of Covenant or any non-contractual obligation arising out of or in connection with this Deed of Covenant) or the consequences of its nullity.

9.3

Appropriate forum

The Issuers agree that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that they will not argue to the contrary.

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9.4

Rights of the Accountholders to take proceedings outside England

Clause ‎9.2 ( English courts ) is for the benefit of the Accountholders only. As a result, nothing in this Clause ‎9 ( Law and jurisdiction ) prevents the Accountholders from taking proceedings relating to a Dispute (" Proceedings ") in any other courts with jurisdiction. To the extent allowed by law, the Accountholders may take concurrent Proceedings in any number of jurisdictions.

9.5

Process agent

The Issuers agree that the documents which start any Proceedings and any other documents required to be served in relation to those Proceedings may be served on them by being delivered to Ecolab Limited at P.O Box 11, Winnington Avenue, Northwich, Cheshire, United Kingdom CW8 4DX or, if different, its registered office for the time being or at any address of the relevant Issuer in Great Britain at which process may be served on it in accordance with the Companies Act 2006. If such person is not or ceases to be effectively appointed to accept service of process on behalf of the Issuers, the Issuers shall, on the written demand of any Accountholder addressed to the relevant Issuer and delivered to the relevant Issuer appoint a further person in England to accept service of process on its behalf and, failing such appointment within 15 days, any Accountholder shall be entitled to appoint such a person by written notice addressed to the relevant Issuer and delivered to the relevant Issuer. Nothing in this paragraph shall affect the right of any Accountholder to serve process in any other manner permitted by law. This clause applies to Proceedings in England and to Proceedings elsewhere.

9.6

Ecolab NL 10 B.V. and Ecolab NL 11 B.V.

If Ecolab NL 10 B.V. or Ecolab NL 11 B.V. are represented by an attorney or attorneys in connection with the signing and/or execution and/or delivery of this Deed of Covenant or any agreement or document referred to herein or made pursuant hereto and the relevant power or powers of attorney is or are expressed to be governed by the laws of The Netherlands, it is hereby expressly acknowledged and accepted by the other parties hereto that such laws shall govern the existence and extent of such attorney's or attorneys' authority and the effects of the exercise thereof.

87441-3-18476-v2.0
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IN WITNESS WHEREOF this Deed of Covenant has been executed by the Issuers on the date stated at the beginning of this Deed of Covenant.


EXECUTED as a DEED	)
by ECOLAB INC.	)
acting under the authority of	)	/s/ Kristen Bettmann
that company	)
acting by	)

EXECUTED as a DEED	)
by ECOLAB LUX 1 S.À R.L.	)
acting under the authority of	)	/s/ Kristen Bettmann
that company	)
acting by	)

EXECUTED as a DEED	)
by ECOLAB LUX 2 S.À R.L.	)
acting under the authority of	)	/s/ Kristen Bettmann
that company	)
acting by	)

EXECUTED as a DEED	)
by ECOLAB NL 10 B.V.	)
acting under the authority of	)	/s/ Kristen Bettmann
that company	)
acting by	)

EXECUTED as a DEED	)
by ECOLAB NL 11 B.V.	)
acting under the authority of	)	/s/ Kristen Bettmann
that company	)
acting by	)

87441-3-18476-v2.0
87441-3-18476-v2.0	- 1 -	70-40653649


	CLIFFORD CHANCE LLP
	Exhibit 10.1.D


		Execution version



ECOLAB INC. ECOLAB LUX 1 S.À R.L. ECOLAB LUX 2 S.À R.L. ECOLAB NL 10 B.V. ECOLAB NL 11 B.V. U.S.$2,000,000,000 EURO COMMERCIAL PAPER PROGRAMME Guaranteed by ECOLAB INC.
	DEED OF GUARANTEE (IN RESPECT OF NOTES ISSUED BY ECOLAB LUX 1 S.À R.L., ECOLAB LUX 2 S.À R.L., ECOLAB NL 10 B.V. AND ECOLAB NL 11 B.V.)

87441-3-18477-v2.0
87441-3-18477-v2.0		70-40653649


CONTENTS
Clause		Page
1.	Interpretation		1
2.	Guarantee and Indemnity		2
3.	Taxes and Withholdings		3
4.	Preservation of Rights		3
5.	Deposit of Deed of Guarantee		5
6.	Stamp Duties		5
7.	Benefit of Deed of Guarantee		6
8.	Partial Invalidity		6
9.	Notices		6
10.	Law and Jurisdiction		7

87441-3-18477-v2.0

70-40653649

THIS DEED OF GUARANTEE is made on

(1)

ECOLAB INC. (the " Guarantor ")

IN FAVOUR OF

(2)

THE HOLDERS for the time being and from time to time of the Notes referred to below (each a " Noteholder " or the " holder " of a Note); and

(3)

THE ACCOUNTHOLDERS (as defined in the Deed of Covenant described below) (together with the Noteholders, the " Beneficiaries ").

WHEREAS

(A)

ECOLAB INC. , ECOLAB LUX 1 S.À R.L., ECOLAB LUX 2 S.À R.L., ECOLAB NL 10 B.V. and ECOLAB NL 11 B.V. (each an " Issuer " and together, the " Issuers ") and the Guarantor have established a Euro-Commercial Paper Programme (the " Programme ") for the issuance of notes (the " Notes "), in connection with which they have entered into an amended and restated dealer agreement dated the date of this Deed of Guarantee (the " Dealer Agreement ") and an amended and restated note agency agreement dated the date of this Deed of Guarantee (the " Agency Agreement ") and the Issuers have executed a deed of covenant dated the date of this Deed of Guarantee (the " Deed of Covenant ").

(B)

The Guarantor has agreed to guarantee the payment of all sums expressed to be payable from time to time by the Issuers to Noteholders in respect of the Notes and to Accountholders in respect of the Deed of Covenant.

NOW THIS DEED OF GUARANTEE witnesses as follows:

INTERPRETATION

1.1

Definitions

All terms and expressions which have defined meanings in the Dealer Agreement, the Agency Agreement or the Deed of Covenant shall have the same meanings in this Deed of Guarantee except where the context requires otherwise or unless otherwise stated.

1.2 Clauses

Any reference in this Deed of Guarantee to a Clause is, unless otherwise stated, to a clause hereof.

1.3 Other agreements

All references in this Deed of Guarantee to an agreement, instrument or other document (including the Dealer Agreement, the Agency Agreement and the Deed of Covenant) shall be construed as a reference to that agreement, instrument or other document as the same may be amended, supplemented, replaced or novated from time to time.

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1.4 Legislation

1.5 Headings

Headings and sub-headings are for ease of reference only and shall not affect the construction of this Deed of Guarantee.

1.6 Benefit of Deed of Guarantee

Any Notes issued under the Programme on or after the date of this Deed of Guarantee shall have the benefit of this Deed of Guarantee but shall not have the benefit of any subsequent guarantee relating to the Programme (unless expressly so provided in any such subsequent guarantee).

GUARANTEE AND INDEMNITY

2.1

Guarantee

The Guarantor hereby unconditionally and irrevocably guarantees:

2.1.1

The Notes : to each Noteholder the due and punctual payment of all sums from time to time payable by the relevant Issuer in respect of the relevant Note as and when the same become due and payable and accordingly undertakes to pay to such Noteholder, in the manner and currency prescribed by such Note for payments by the relevant Issuer in respect of such Note, any and every sum or sums which the relevant Issuer is at any time liable to pay in respect of such Note and which the relevant Issuer has failed to pay; and

2.1.2

The Direct Rights : to each Accountholder the due and punctual payment of all sums from time to time payable by the relevant Issuer to such Accountholder in respect of the Direct Rights as and when the same become due and payable and accordingly undertakes to pay to such Accountholder, in the manner and currency prescribed by the Notes for payments by the relevant Issuer in respect of the Notes, any and every sum or sums which the relevant Issuer is at any time liable to pay to such Accountholder in respect of the Notes and which the relevant Issuer has failed to pay.

2.2

Indemnity

The Guarantor irrevocably and unconditionally agrees as a primary obligation to indemnify each Beneficiary from time to time from and against any loss, liability or cost incurred by such Beneficiary as a result of any of the obligations of the relevant Issuer under or pursuant to any Note, the Deed of Covenant or any provision thereof being or becoming void, voidable, unenforceable or ineffective for any reason whatsoever, whether or not known to such Beneficiary or any other person, the amount of such loss being the amount which such Beneficiary would otherwise have been entitled to recover from the relevant Issuer. Any amount payable pursuant to this

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indemnity shall be payable in the manner and currency prescribed by the Notes for payments by the relevant Issuer in respect of the Notes. This indemnity constitutes a separate and independent obligation from the other obligations under this Deed of Guarantee and shall give rise to a separate and independent cause of action.

TAXES AND WITHHOLDINGS

All payments in respect of the Notes and Direct Rights under this Deed of Guarantee shall be made without set-off, counterclaim, fees, liabilities or similar deductions and free and clear of, and without deduction or withholding for, taxes, levies, duties or charges of any nature now or hereafter imposed, levied, collected, withheld or assessed in any jurisdiction through or from which such payments are made or any political subdivision or taxing authority thereof or therein (" Taxes "). If the Guarantor or any agent thereof is required by law or regulation to make any deduction or withholding for or on account of Taxes, the Guarantor shall, to the extent permitted by applicable law or regulation, pay such additional amounts as shall be necessary in order that the net amounts received by any Beneficiary after such deduction or withholding shall equal the amount which would have been receivable hereunder in the absence of such deduction or withholding, except that no such additional amounts shall be payable:

3.2.1

to a Beneficiary which is liable to such Taxes by reason of its having some connection with the jurisdiction imposing the Taxes other than the mere holding of the Note or the Direct Rights; or

3.2.2

in respect of any Note presented for payment more than 15 days after the Maturity Date or the date on which payment thereof is duly provided for, whichever occurs later, except to the extent that the Beneficiary would have been entitled to such additional amounts if it had presented the Note on the last day of such period of 15 days.

PRESERVATION OF RIGHTS

4.1

Principal obligor

The obligations of the Guarantor hereunder shall be deemed to be undertaken as principal obligor and not merely as surety.

4.2

Continuing obligations

The obligations of the Guarantor herein contained shall constitute and be continuing obligations notwithstanding any settlement of account or other matter or thing whatsoever and shall not be considered satisfied by any intermediate payment or satisfaction of all or any of the Issuers' obligations under or in respect of any Note or the Deed of Covenant and shall continue in full force and effect for so long as the Programme remains in effect and thereafter until all sums due from the Issuers in respect of the Notes and under the Deed of Covenant have been paid, and all other actual or contingent obligations of the Issuers thereunder or in respect thereof have been satisfied, in full.

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4.3

Obligations not discharged

Neither the obligations of the Guarantor herein contained nor the rights, powers and remedies conferred upon the Beneficiaries by this Deed of Guarantee or by law shall be discharged, impaired or otherwise affected by:

4.3.1

Winding up : the winding up, dissolution, administration, re-organisation or moratorium of an Issuer or any change in its status, function, control or ownership;

4.3.2

Illegality : any of the obligations of an Issuer under or in respect of any Note or the Deed of Covenant being or becoming illegal, invalid, unenforceable or ineffective in any respect;

4.3.3

Indulgence : time or other indulgence (including for the avoidance of doubt, any composition) being granted or agreed to be granted to an Issuer in respect of any of its obligations under or in respect of any Note or the Deed of Covenant;

4.3.4

Amendment : any amendment to, or any variation, waiver or release of, any obligation of an Issuer under or in respect of any Note or the Deed of Covenant or any security or other guarantee or indemnity in respect thereof, however fundamental; or

4.3.5

Analogous events : any other act, event or omission which, but for this sub-clause, might operate to discharge, impair or otherwise affect the obligations expressed to be assumed by the Guarantor herein or any of the rights, powers or remedies conferred upon the Beneficiaries or any of them by this Deed of Guarantee or by law.

4.4

Settlement conditional

Any settlement or discharge between the Guarantor and the Beneficiaries or any of them shall be conditional upon no payment to the Beneficiaries or any of them by the Issuers or any other person on the Issuers' behalf being avoided or reduced by virtue of any laws relating to bankruptcy, insolvency, liquidation or similar laws of general application for the time being in force and, in the event of any such payment being so avoided or reduced, the Beneficiaries shall be entitled to recover the amount by which such payment is so avoided or reduced from the Guarantor subsequently as if such settlement or discharge had not occurred.

4.5

Exercise of Rights

No Beneficiary shall be obliged before exercising any of the rights, powers or remedies conferred upon it by this Deed of Guarantee or by law:

4.5.1

Demand : to make any demand of the relevant Issuer, save for the presentation of the relevant Note;

4.5.2

Take action : to take any action or obtain judgment in any court against the relevant Issuer; or

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4.5.3

Claim or proof : to make or file any claim or proof in a winding up or dissolution of the relevant Issuer,

and (save as aforesaid) the Guarantor hereby expressly waives presentment, demand, protest and notice of dishonour in respect of any Note.

4.6

Deferral of Guarantor's rights

The Guarantor agrees that, so long as any sums are or may be owed by the Issuers in respect of any Note or under the Deed of Covenant or the Issuers are under any other actual or contingent obligation thereunder or in respect thereof, the Guarantor will not exercise any rights which the Guarantor may at any time have by reason of the performance by the Guarantor of its obligations hereunder:

4.6.1

Indemnity : to be indemnified by the relevant Issuer;

4.6.2

Contribution : to claim any contribution from any other guarantor of the relevant Issuer's obligations under or in respect of any Note or the Deed of Covenant; or

4.6.3

Subrogation : to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of any Beneficiary against the relevant Issuer in respect of amounts paid by the Guarantor under this Deed of Guarantee or any security enjoyed in connection with any Note or the Deed of Covenant by any Beneficiary.

4.7

Pari passu

The Guarantor undertakes that its obligations hereunder will at all times rank at least pari passu with all other present and future unsecured obligations of the Guarantor, save for such obligations as may be preferred by provisions of law that are both mandatory and of general application.

DEPOSIT OF DEED OF GUARANTEE

This Deed of Guarantee shall be deposited with and held by the Issue and Paying Agent for so long as the Programme remains in effect and thereafter until all the obligations of the Issuers under or in respect of the Notes (including, without limitation, its obligations under the Deed of Covenant) have been discharged in full. The Guarantor hereby acknowledges the right of every Beneficiary to the production of this Deed of Guarantee.

STAMP DUTIES

The Guarantor shall pay all stamp, registration and other similar taxes and duties (including any interest and penalties thereon or in connection therewith) which are payable upon or in connection with the execution and delivery of this Deed of Guarantee, except for any taxes payable regarding Luxembourg registration duties ( droits d’enregistrement ) due to a registration, submission or filing of this Deed of Guarantee where such registration, submission or filing is or was not required to maintain or preserve the rights of the Beneficiaries under this Deed of Guarantee, and shall indemnify each Beneficiary against any claim, demand, action, liability, damages, cost, loss or expense (including, (i) an amount equal to any United Kingdom value

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added tax but only to the extent such Beneficiary, or any member of the group to which that Beneficiary belongs for value added tax purposes, reasonably determines that it is not entitled to recover (whether by credit or repayment) such value added tax and (ii) fees and disbursements of counsel to such Beneficiary) which it incurs as a result or arising out of or in relation to any failure to pay or delay in paying any of the same.

BENEFIT OF DEED OF GUARANTEE

7.1

Deed poll

This Deed of Guarantee shall take effect as a deed poll for the benefit of the Beneficiaries from time to time.

7.2

Benefit

This Deed of Guarantee shall enure to the benefit of each Beneficiary and its (and any subsequent) successors and assigns, each of which shall be entitled severally to enforce this Deed of Guarantee against the Guarantor.

7.3

Assignment

The Guarantor shall not be entitled to assign or transfer all or any of its rights, benefits and obligations hereunder. Each Beneficiary shall be entitled to assign all or any of its rights and benefits hereunder.

PARTIAL INVALIDITY

NOTICES

9.1

Address for notices

All notices and other communications to the Guarantor hereunder shall be made in writing (by letter or fax) and shall be sent to the Guarantor at:

1 Ecolab Place

St. Paul

MN 55102

U.S.A.


Fax:	+1 651 250 2573
Attention:	General Counsel

or to such other address or fax number or for the attention of such other person or department as the Guarantor has notified to the Beneficiaries.

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9.2

Effectiveness

Every notice or other communication sent in accordance with Clause ‎9.1 ( Address for notices ) shall be effective upon receipt by the Guarantor; provided that any such notice or other communication which would otherwise take effect after 4.00 p.m. on any particular day shall not take effect until 10.00 a.m. on the immediately succeeding business day in the place of the Guarantor.

10.

LAW AND JURISDICTION

10.1

Governing law

This Deed of Guarantee and any non-contractual obligations arising out of or in connection with it are governed by English law.

10.2

English courts

The courts of England have exclusive jurisdiction to settle any dispute (a " Dispute "), arising from or connected with this Deed of Guarantee (including a dispute regarding the existence, validity or termination of this Deed of Guarantee or any non-contractual obligation arising out of or in connection with this Deed of Guarantee) or the consequences of its nullity.

10.3

Appropriate forum

The Guarantor agrees that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that it will not argue to the contrary.

10.4

Rights of the Beneficiaries to take proceedings outside England

Clause ‎10.2 ( English courts ) is for the benefit of the Beneficiaries only. As a result, nothing in this Clause ‎10 ( Law and jurisdiction ) prevents the Beneficiaries from taking proceedings relating to a Dispute (" Proceedings ") in any other courts with jurisdiction. To the extent allowed by law, the Beneficiaries may take concurrent Proceedings in any number of jurisdictions.

10.5

Service of process

The Guarantor agrees that the process by which any Proceedings in England and any other documents required to be served in relation to those Proceedings may be served on it by being delivered to Ecolab Limited at P.O. Box 11, Winnington Avenue, Northwich, Cheshire, United Kingdom CW8 4DX or, if different, its registered office for the time being or at any other address of the Guarantor in Great Britain at which process may be served on it in accordance with the Companies Act 2006. If such person is not or ceases to be effectively appointed to accept service of process on behalf of the Guarantor, the Guarantor shall, on the written demand of any Beneficiary addressed and delivered to the Guarantor, appoint a further person in England to accept service of process on its behalf and, failing such appointment within 15 days, any Beneficiary shall be entitled to appoint such a person by written notice addressed to the Guarantor and delivered to the Guarantor. Nothing in this paragraph shall affect the right of any Beneficiary to serve process in any other manner permitted by law. This clause applies to Proceedings in England and to Proceedings elsewhere.

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IN WITNESS WHEREOF this Deed of Guarantee has been executed by the Guarantor on the date stated at the beginning of this Deed of Guarantee.


EXECUTED as a DEED	)
by ECOLAB INC .	)
acting under the authority of	)	/s/ Kristen Bettmann
that company	)
acting by	)

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Exhibit (15.1)

August 3, 2017

Securities and Exchange Commission

100 F Street, N.E.

Washington, D.C. 20549

RE:

Ecolab Inc. Registration Statements on Form S-8 (Registration Nos. 2-90702; 33-18202;
33-55986; 33-56101; 333-95043; 333-109890; 33-34000; 33-56151; 333-18627; 333-109891; 33-39228; 33-56125; 333-70835; 33-60266; 333-95041; 333-40239; 333-95037; 333-50969; 333-58360; 333-97927; 333-115567; 333-129427; 333-129428; 333-140988; 333-115568;
333-132139; 333-147148; 333-163837; 333-163838; 333-165130; 333-165132; 333-166646; 333-174028; 333-176601; 333-178300; 333-178302; 333-184650; 333-190317; 333-199729; 333-199730; and 333-199732) and Form S-3 (Registration No. 333-201445).

Commissioners:

We are aware that our report dated August 3, 2017 on our review of interim financial information of Ecolab Inc. (the “Company”) for the three-month period ended June 30, 2017 and included in the Company’s quarterly report on Form 10-Q for the quarter ended June 30, 2017 is incorporated by reference in its Registration Statements listed above.


Yours very truly,


/s/ PricewaterhouseCoopers LLP

PRICEWATERHOUSECOOPERS LLP

Minneapolis, Minnesota

Exhibit (31.1)

CERTIFICATION

I, Douglas M. Baker, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2017 of Ecolab Inc.;

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

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

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

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

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

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

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

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

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

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


Date: August 3, 2017


/s/ Douglas M. Baker, Jr.
Douglas M. Baker, Jr.
Chairman of the Board and
Chief Executive Officer

Exhibit (31.2)

CERTIFICATION

I, Daniel J. Schmechel, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2017 of Ecolab Inc.;

(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: August 3, 2017


/s/ Daniel J. Schmechel
Daniel J. Schmechel
Chief Financial Officer

Exhibit (32.1)

Section 1350 Certifications

Pursuant to 18 U.S.C. Section 1350, each of the undersigned officers of Ecolab Inc. does hereby certify that:

(a) the Quarterly Report on Form 10-Q of Ecolab Inc. for the quarter ended June 30, 2017 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(b) information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Ecolab Inc.


Dated: August 3, 2017	/s/ Douglas M. Baker, Jr.
	Douglas M. Baker, Jr.
	Chairman of the Board and Chief Executive Officer


Dated: August 3, 2017
	/s/ Daniel J. Schmechel
	Daniel J. Schmechel
	Chief Financial Officer