UNITEDSTATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

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FORM 10-Q

(Mark One)

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|   | **QUARTERLY REPORTPURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF1934** |

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|   | **For the quarterly periodended September 30, 2005** |

**or**

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|   | **TRANSITIONREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934** |

For the transition periodfrom    to    .

Commission File No.333-115560-15

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NALCOHOLDINGS LLC

(Exact name of registrant asspecified in its charter)

|                                                                           |  |                                                       |  |  |  |  |
|---------------------------------------------------------------------------|--|-------------------------------------------------------|--|--|--|--|
| **Delaware**(State or other jurisdiction of Incorporation orOrganization) |  | **73-1683500** (I.R.S. EmployerIdentification Number) |
|                                                                           |

1601 West Diehl RoadNaperville, IL 60563-1198 (630) 305-1000

(Address, Including Zip Code, and Telephone Number,Including Area Code, of Registrant's Principal ExecutiveOffices)

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 filesuch reports), and (2) has been subject to such filing requirements forthe past 90days.   Yes         No 

Indicate by check mark whether the registrant is anaccelerated filer (as defined in Rule 12b-2 of the ExchangeAct.)   Yes         No 

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QUARTERLY REPORTON FORM 10-Q NALCO HOLDINGS LLC Quarter Ended September 30,2005

TABLE OFCONTENTS

|                                                        |  |                                                                                                                                                                                                                                           |        |        |        |        |  |  |  |  |
|--------------------------------------------------------|--|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--|--|--|--|
| **PartI.    FinancialInformation** |  |                                                                                                                                                                                                                                      |   |   |
|                                                   |  | Item1.  Financial Statements(Unaudited)                                                                                                                                                                                         |        |   |   |   |
|                                                   |  | CondensedConsolidated Balance Sheets – September 30, 2005 andDecember 31,2004                                                                                                                                                       |        |   | 2      |   |
|                                                   |  | CondensedConsolidated Statements of Operations – Three months andnine months ended September 30, 2005 and2004                                                                                                                       |        |   | 3      |   |
|                                                   |  | CondensedConsolidated Statements of Cash Flows – Nine months endedSeptember 30, 2005 and2004                                                                                                                                        |        |   | 4      |   |
|                                                   |  | Notes to CondensedConsolidated Financial Statements – September 30,2005                                                                                                                                                             |        |   | 5      |   |
|                                                   |  | Item2.    Management's Discussion and Analysis of FinancialCondition and                     Results ofOperations |        |   | 22     |   |
|                                                   |  | Item3.    Quantitative and Qualitative Disclosures About MarketRisk                                                                                                                                                   |        |   | 33     |   |
|                                                   |  | Item 4.    Controls andProcedures                                                                                                                                                                                     |        |   | 33     |   |
| **PartII.     OtherInformation**   |  |                                                                                                                                                                                                                                      |   |   |
|                                                   |  | Item1.    Legal Proceedings                                                                                                                                                                                           |        |   | 34     |   |
|                                                   |  | Item6.    Exhibits                                                                                                                                                                                                    |        |   | 34     |   |
| **Signature**                                          |  |                                                                                                                                                                                                                                      | 35     |   |
|                                                        |

1

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PART I. FINANCIALINFORMATION

Item 1. Financial Statements (Unaudited)

Nalco Holdings LLC and Subsidiaries Condensed ConsolidatedBalance Sheets(dollars inmillions)

|                                                                       |  |                             |         |                 |  |        |         |        |  |  |
|-----------------------------------------------------------------------|--|-----------------------------|---------|-----------------|--|--------|---------|--------|--|--|
|                                                                  |  | (Unaudited)September30,2005 |         | December31,2004 |
| **Assets**                                                            |  |                        |    |            |  |   |    |   |
| Currentassets:                                                        |  |                        |    |            |  |   |    |   |
| Cash and cashequivalents                                              |  | $                           | 46.7    |            |  | $      | 33.2    |   |
| Accountsreceivable, less allowances of $20.1 in 2005 and $21.1 in2004 |  |                        | 598.7   |            |  |   | 594.2   |   |
| Inventories:                                                          |  |                        |    |            |  |   |    |   |
| Finishedproducts                                                      |  |                        | 239.0   |            |  |   | 245.4   |   |
| Materialsand work inprocess                                           |  |                        | 70.9    |            |  |   | 68.1    |   |
|                                                                  |  |                        | 309.9   |            |  |   | 313.5   |   |
| Prepaidexpenses, taxes and other currentassets                        |  |                        | 89.9    |            |  |   | 90.1    |   |
| Totalcurrentassets                                                    |  |                        | 1,045.2 |            |  |   | 1,031.0 |   |
| Property,plant, and equipment,net                                     |  |                        | 763.2   |            |  |   | 847.3   |   |
| Intangibleassets:                                                     |  |                        |    |            |  |   |    |   |
| Goodwill                                                              |  |                        | 2,220.8 |            |  |   | 2,368.3 |   |
| Otherintangibles,net                                                  |  |                        | 1,252.2 |            |  |   | 1,323.6 |   |
| Otherassets                                                           |  |                        | 348.7   |            |  |   | 363.5   |   |
| Totalassets                                                           |  | $                           | 5,630.1 |            |  | $      | 5,933.7 |   |
| **Liabilitiesand unitholder'sequity**                                 |  |                        |    |            |  |   |    |   |
| Currentliabilities:                                                   |  |                        |    |            |  |   |    |   |
| Accountspayable                                                       |  | $                           | 266.0   |            |  | $      | 261.9   |   |
| Shortterm debt                                                        |  |                        | 18.5    |            |  |   | 17.7    |   |
| Othercurrentliabilities                                               |  |                        | 267.6   |            |  |   | 311.7   |   |
| Totalcurrentliabilities                                               |  |                        | 552.1   |            |  |   | 591.3   |   |
| Otherliabilities:                                                     |  |                        |    |            |  |   |    |   |
| Long-termdebt                                                         |  |                        | 2,920.3 |            |  |   | 3,100.6 |   |
| Deferredincometaxes                                                   |  |                        | 418.1   |            |  |   | 501.5   |   |
| Accruedpensionbenefits                                                |  |                        | 417.4   |            |  |   | 411.7   |   |
| Otherliabilities                                                      |  |                        | 296.2   |            |  |   | 296.8   |   |
| Minorityinterest                                                      |  |                        | 12.6    |            |  |   | 14.1    |   |
| Unitholder'sequity                                                    |  |                        | 1,013.4 |            |  |   | 1,017.7 |   |
| Totalliabilities and unitholder'sequity                               |  | $                           | 5,630.1 |            |  | $      | 5,933.7 |   |
|                                                                       |

Seeaccompanying notes to condensed consolidated financialstatements.

2

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Nalco Holdings LLC and SubsidiariesCondensed Consolidated Statements of Operations (Unaudited)(dollars inmillions)

|                                              |  |                                    |         |                                    |  |                                   |         |                                   |  |        |         |         |  |        |         |         |  |  |
|----------------------------------------------|--|------------------------------------|---------|------------------------------------|--|-----------------------------------|---------|-----------------------------------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                         |  | ThreeMonthsended September 30,2005 |         | ThreeMonthsended September 30,2004 |  | NineMonthsended September 30,2005 |         | NineMonthsended September 30,2004 |
| Netsales                                     |  | $                                  | 834.9   |                               |  | $                                 | 774.2   |                              |  | $      | 2,448.8 |    |  | $      | 2,227.9 |    |
| Operatingcosts andexpenses:                  |  |                               |    |                               |  |                              |    |                              |  |   |    |    |  |   |    |    |
| Costof productsold                           |  |                               | 457.6   |                               |  |                              | 401.3   |                              |  |   | 1,349.9 |    |  |   | 1,147.9 |    |
| Selling,administrative, and researchexpenses |  |                               | 251.5   |                               |  |                              | 255.1   |                              |  |   | 773.3   |    |  |   | 770.0   |    |
| Amortizationof intangibleassets              |  |                               | 20.3    |                               |  |                              | 23.9    |                              |  |   | 61.4    |    |  |   | 73.0    |    |
| In-processresearch anddevelopment            |  |                               | — |                               |  |                              | — |                              |  |   | — |    |  |   | 122.3   |    |
| Businessoptimizationexpenses                 |  |                               | 3.5     |                               |  |                              | — |                              |  |   | 21.3    |    |  |   | — |    |
| Totaloperating costs andexpenses             |  |                               | 732.9   |                               |  |                              | 680.3   |                              |  |   | 2,205.9 |    |  |   | 2,113.2 |    |
|                                         |  |                               |    |                               |  |                              |    |                              |  |   |    |    |  |   |    |    |
| Operatingearnings                            |  |                               | 102.0   |                               |  |                              | 93.9    |                              |  |   | 242.9   |    |  |   | 114.7   |    |
|                                         |  |                               |    |                               |  |                              |    |                              |  |   |    |    |  |   |    |    |
| Otherincome (expense),net                    |  |                               | — |                               |  |                              | (1.2    | )                            |  |   | (2.8    | )  |  |   | (6.5    | )  |
| Interestincome                               |  |                               | 2.1     |                               |  |                              | 2.3     |                              |  |   | 6.2     |    |  |   | 7.7     |    |
| Interestexpense                              |  |                               | (58.3   | )                             |  |                              | (53.7   | )                            |  |   | (170.8  | )  |  |   | (159.7  | )  |
|                                         |  |                               |    |                               |  |                              |    |                              |  |   |    |    |  |   |    |    |
| Earnings(loss) before incometaxes            |  |                               | 45.8    |                               |  |                              | 41.3    |                              |  |   | 75.5    |    |  |   | (43.8   | )  |
|                                         |  |                               |    |                               |  |                              |    |                              |  |   |    |    |  |   |    |    |
| Incometaxprovision                           |  |                               | 21.0    |                               |  |                              | 27.2    |                              |  |   | 33.9    |    |  |   | 46.8    |    |
|                                         |  |                               |    |                               |  |                              |    |                              |  |   |    |    |  |   |    |    |
| Minorityinterests                            |  |                               | (1.6    | )                             |  |                              | (1.7    | )                            |  |   | (4.4    | )  |  |   | (3.6    | )  |
| Netearnings(loss)                            |  | $                                  | 23.2    |                               |  | $                                 | 12.4    |                              |  | $      | 37.2    |    |  | $      | (94.2   | )  |
|                                              |

Seeaccompanying notes to condensed consolidated financialstatements.

3

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Nalco Holdings LLC and SubsidiariesCondensed Consolidated Statements of Cash Flows (Unaudited)(dollars inmillions)

|                                                                                          |  |                                  |         |                                 |  |        |        |         |  |  |
|------------------------------------------------------------------------------------------|--|----------------------------------|---------|---------------------------------|--|--------|--------|---------|--|--|
|                                                                                     |  | NineMonthsendedSeptember 30,2005 |         | NineMonthsendedSeptember30,2004 |
| **Operatingactivities**                                                                  |  |                             |    |                            |  |   |   |    |
| Net earnings(loss)                                                                       |  | $                                | 37.2    |                            |  | $      | (94.2  | )  |
| Adjustments toreconcile net earnings (loss) to net cash provided by operatingactivities: |  |                             |    |                            |  |   |   |    |
| Depreciation                                                                             |  |                             | 100.0   |                            |  |   | 80.7   |    |
| Amortization                                                                             |  |                             | 61.4    |                            |  |   | 73.0   |    |
| In-processresearch anddevelopment                                                        |  |                             | — |                            |  |   | 122.3  |    |
| Amortizationof deferred financingcosts                                                   |  |                             | 8.2     |                            |  |   | 8.4    |    |
| Other,net                                                                                |  |                             | 22.3    |                            |  |   | 21.1   |    |
| Changes inoperating assets andliabilities                                                |  |                             | (55.1   | )                          |  |   | 44.9   |    |
| Netcash provided by operatingactivities                                                  |  |                             | 174.0   |                            |  |   | 256.2  |    |
|                                                                                     |  |                             |    |                            |  |   |   |    |
| **Investingactivities**                                                                  |  |                             |    |                            |  |   |   |    |
| Purchase priceadjustment on acquisition of Ondeo NalcoGroup                              |  |                             | (3.2    | )                          |  |   | 25.3   |    |
| Additions toproperty, plant, and equipment,net                                           |  |                             | (45.3   | )                          |  |   | (57.7  | )  |
| Other investingactivities                                                                |  |                             | (0.9    | )                          |  |   | (5.1   | )  |
| Netcash used for investingactivities                                                     |  |                             | (49.4   | )                          |  |   | (37.5  | )  |
|                                                                                     |  |                             |    |                            |  |   |   |    |
| **Financingactivities**                                                                  |  |                             |    |                            |  |   |   |    |
| Changes inshort-term debt,net                                                            |  |                             | 1.7     |                            |  |   | (38.1  | )  |
| Proceeds fromlong-term debt                                                              |  |                             | 24.1    |                            |  |   | 93.0   |    |
| Repaymentsof long-termdebt                                                               |  |                             | (130.8  | )                          |  |   | (318.6 | )  |
| Capitalcontributions                                                                     |  |                             | — |                            |  |   | 11.0   |    |
| Other                                                                                    |  |                             | (5.6    | )                          |  |   | (0.7   | )  |
| Netcash used for financingactivities                                                     |  |                             | (110.6  | )                          |  |   | (253.4 | )  |
| Effect ofexchange rate changes on cash and cashequivalents                               |  |                             | (0.5    | )                          |  |   | (2.2   | )  |
| Increase(decrease) in cash and cashequivalents                                           |  |                             | 13.5    |                            |  |   | (36.9  | )  |
| Cash andcash equivalents at beginning ofperiod                                           |  |                             | 33.2    |                            |  |   | 100.0  |    |
| Cashand cash equivalents at end ofperiod                                                 |  | $                                | 46.7    |                            |  | $      | 63.1   |    |
|                                                                                          |

Seeaccompanying notes to condensed consolidated financialstatements.

4

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NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements(Unaudited)

September 30,2005

1.    Descriptionof Business and Change in Ownership

Description ofBusiness

Nalco Holdings LLC and subsidiaries (the Company) isengaged in the worldwide manufacture and sale of highly specializedservice chemical programs. This includes production and service relatedto the sale and application of chemicals and technology used in watertreatment, pollution control, energy conservation, oil production andrefining, steelmaking, papermaking, mining, and other industrialprocesses.

Change in Ownership

On November 4, 2003,Nalco Holdings LLC (the Buyer), a newly-formed entity controlled byaffiliates of The Blackstone Group, L.P., Apollo Management, L.P., andThe Goldman Sachs Group, Inc. (collectively, the Sponsors), pursuant toa Stock Purchase Agreement, as amended, with Suez S.A. (Suez or Seller)and certain of its affiliates, acquired the net assets of Ondeo NalcoGroup for $4,127.1 million, including direct costs of the acquisitionof $125.6 million, excluding assumed debt of $30.2 million, and subjectto certain closing and post-closing adjustments (the Acquisition).

The Buyer was capitalized by equity investments totaling $991.9million from the Sponsors and $10.0 million from Dr. William H. Joyce,the Chairman and Chief Executive Officer of the Company. The equityinvestments were made to Nalco Investment Holdings LLC, which, in turn,contributed $1,001.9 million to the Buyer and was its parent companyuntil January 14, 2004. Funding for the Acquisition included the equityinvestments and the issuance of senior notes and senior subordinatednotes in a private offering, and new revolving credit and term loanfacilities by the Buyer, through its 100% owned subsidiary,Nalco Company.

The Stock Purchase Agreement provided for certainadjustments of the purchase price, including adjustments based on theclosing working capital and indebtedness (as both are defined in theStock Purchase Agreement) of the Ondeo Nalco Group at the date of theAcquisition. On March 25, 2004, the Buyer and Suez agreed to a $25.6million working capital adjustment payable to the Buyer plus interest.The Buyer recorded the purchase price adjustment in 2004 by decreasinggoodwill.

The Stock Purchase Agreement also provided foradjustments of the purchase price for taxes paid, or tax refundsreceived, by the Buyer for periods prior to the Acquisition, to theextent not already taken into account in the closing working capital atthe date of the Acquisition. During the year ended December 31, 2004,such purchase price adjustments resulted in a net payment of $0.3million by the Buyer, which was recorded as an increase to goodwill. Anadditional purchase price adjustment of $3.2 million paid by theCompany in January 2005 was also accrued and reflected as an increaseto goodwill in 2004.

On January 14, 2004, Nalco InvestmentHoldings LLC contributed its 100% interest in the Buyer to anewly formed entity, Nalco Finance Holdings LLC. As of that date, NalcoFinance Holdings LLC became the direct parent company of the Buyer.Subsequent to that date, the Sponsors and Dr. Joyce engaged in a seriesof transactions that ultimately resulted in a newly formed entity,Nalco LLC, becoming the direct parent company of another newly formedentity, Nalco Investment Holdings II Corp., which, in turn, became thedirect parent company of Nalco Investment Holdings LLC. NalcoInvestment Holdings II Corp. was subsequently renamed Nalco HoldingCompany.

As part of the allocation of the purchase price for theAcquisition, the Company recorded a one-time charge for purchasedin-process research and development (IPR&D) expenses of $122.3million during the nine months ended September 30, 2004. The value ofpurchased IPR&D was comprised of five 

5

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NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements  (continued)(Unaudited)

September 30,2005

1.    Descriptionof Business and Change in Ownership   (continued)

ongoing development projects at the date ofthe Acquisition. Purchased IPR&D was derived by assigning values tothose projects identified by management as having economic value, butthat had not yet reached technological feasibility and had noalternative future use. These products had not been released to themarket as of the date of the Acquisition, but the features andfunctionality of the products had been defined.

The consolidatedstatement of operations for the nine months ended September 30, 2004includes an additional $14.5 million in cost of products sold relatedto the sale of inventory that had been revalued at selling price lesscosts to sell in the allocation of the purchase price for theAcquisition.

In conjunction with the Acquisition, the Companyformulated a plan to exit or restructure certain activities. TheCompany recorded liabilities of $35.5 million, primarily for employeeseverance and related costs, in connection with the Company'splan to exit or restructure certain activities. The Company expects tocomplete these activities by the end of 2005. As of December 31, 2004,$3.8 million remained of this accrual; $0.7 million was charged againstit during the nine months ended September 30, 2005.

2.    Basis ofPresentation

These consolidated financial statements should beread in conjunction with the consolidated and combined financialstatements and notes thereto included in the Annual Report for NalcoHoldings LLC and subsidiaries for the fiscal year ended December 31,2004.

The accompanying unaudited consolidated financialstatements have been prepared in accordance with generally acceptedaccounting principles for interim financial information. Accordingly,they do not include all of the information and footnotes required byaccounting principles generally accepted in the United States forcomplete financial statements. Management believes these financialstatements include all normal recurring adjustments considerednecessary for a fair presentation of the financial position and resultsof operations of the Company. Operating results for the nine monthsended September 30, 2005 are not necessarily indicative of results thatmay be expected for the year ended December 31, 2005.

Certainreclassifications have been made to the prior year data to conform tothe current year presentation which had no effect on net earnings(loss) reported for any period.

3.    Goodwilland Other Intangible Assets

The changes in goodwill for theperiod were as follows:

|                                                                   |  |        |         |         |  |  |
|-------------------------------------------------------------------|--|--------|---------|---------|--|--|
| (dollars in millions)                                             |  |   |
| Balance asof December 31, 2004                                    |  | $      | 2,368.3 |    |
| Preacquisitionincome tax uncertainties an deferred taxadjustments |  |   | (69.7   | )  |
| Effect of foreigncurrencytranslation                              |  |   | (77.8   | )  |
| Balance as ofSeptember 30,2005                                    |  | $      | 2,220.8 |    |
|                                                                   |

The Companyhas substantially completed a review of its accumulated deferred taxbalances and determined that certain deferred tax liabilities wereoverstated. These liabilities primarily relate to deferred taxes onintangible assets that should have been reversed as part of theallocation of the purchase price for the Acquisition. Therefore,goodwill and deferred tax liabilities have been reduced by $70.0million.

6

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NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements  (continued)(Unaudited)

September 30,2005

3.    Goodwilland Other Intangible Assets   (continued)

The following table reflects intangibleassets and related amortization information:

|                                              |  |                         |         |                         |  |             |         |                         |  |        |         |        |  |        |         |         |  |  |
|----------------------------------------------|--|-------------------------|---------|-------------------------|--|-------------|---------|-------------------------|--|--------|---------|--------|--|--------|---------|---------|--|--|
|                                         |  | Asof September 30, 2005 |         | As of December 31,2004  |
| (dollars inmillions)                         |  | GrossAmount             |         | AccumulatedAmortization |  | GrossAmount |         | AccumulatedAmortization |
| Intangibleassets subject toamortization:     |  |                    |    |                    |  |        |    |                    |  |   |    |   |  |   |    |    |
| Customerrelationships                        |  | $                       | 491.1   |                    |  | $           | (153.5  | )                  |  | $      | 506.6   |   |  | $      | (103.5  | )  |
| Patentsand developedtechnology               |  |                    | 100.5   |                    |  |        | (19.6   | )                  |  |   | 100.5   |   |  |   | (12.2   | )  |
| Other                                        |  |                    | 3.7     |                    |  |        | — |                    |  |   | 2.2     |   |  |   | — |    |
| Intangibleassets not subject toamortization: |  |                    |    |                    |  |        |    |                    |  |   |    |   |  |   |    |    |
| Trademarksand tradenames                     |  |                    | 830.0   |                    |  |        | — |                    |  |   | 830.0   |   |  |   | — |    |
|                                         |  | $                       | 1,425.3 |                    |  | $           | (173.1  | )                  |  | $      | 1,439.3 |   |  | $      | (115.7  | )  |
|                                              |

4.    Debt

Debt consists of the following:

|                                              |  |                  |         |                 |  |        |         |        |  |  |
|----------------------------------------------|--|------------------|---------|-----------------|--|--------|---------|--------|--|--|
|                                         |  | September30,2005 |         | December31,2004 |
| (dollars inmillions)                         |  |             |         |            |
| **Short-term**                               |  |             |    |            |  |   |    |   |
| Checksoutstanding and bankoverdrafts         |  | $                | 17.1    |            |  | $      | 16.9    |   |
| Notes payableto banks                        |  |             | 0.7     |            |  |   | — |   |
| Currentmaturities of long-termdebt           |  |             | 0.7     |            |  |   | 0.8     |   |
|                                         |  | $                | 18.5    |            |  | $      | 17.7    |   |
| **Long-term**                                |  |             |    |            |  |   |    |   |
| Securitizedtrade accounts receivablefacility |  | $                | 78.7    |            |  | $      | 97.3    |   |
| Term loan A,due November 2009                |  |             | 120.2   |            |  |   | 218.4   |   |
| Termloan B, due November2010                 |  |             | 1,081.0 |            |  |   | 1,081.0 |   |
| Senior notes,due November 2011               |  |             | 905.8   |            |  |   | 937.4   |   |
| Seniorsubordinated notes, due November2013   |  |             | 705.8   |            |  |   | 737.4   |   |
| Unsecured notes,due May2008                  |  |             | 27.8    |            |  |   | 27.8    |   |
| Other                                        |  |             | 1.7     |            |  |   | 2.1     |   |
|                                         |  |             | 2,921.0 |            |  |   | 3,101.4 |   |
| Less:Currentportion                          |  |             | 0.7     |            |  |   | 0.8     |   |
|                                         |  | $                | 2,920.3 |            |  | $      | 3,100.6 |   |
|                                              |

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NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements  (continued)(Unaudited)

September 30,2005

5.    Unitholder'sEquity

Unitholder's equity consists of the following:

|                                       |  |                   |         |                   |  |        |         |         |  |  |
|---------------------------------------|--|-------------------|---------|-------------------|--|--------|---------|---------|--|--|
| (dollarsin millions)                  |  | September 30,2005 |         | December 31, 2004 |
| Capitalaccount                        |  | $                 | 1,013.2 |              |  | $      | 1,012.9 |    |
| Accumulateddeficit                    |  |              | (91.1   | )            |  |   | (128.3  | )  |
| Accumulatedother comprehensiveincome: |  |              |    |              |  |   |    |    |
| Derivatives                           |  |              | 0.1     |              |  |   | (0.2    | )  |
| Foreigncurrency translationadjustment |  |              | 91.2    |              |  |   | 133.3   |    |
| Totalunitholder'sequity               |  | $                 | 1,013.4 |              |  | $      | 1,017.7 |    |
|                                       |

6.    Pensionand Other Postretirement Benefit Plans

The components of netperiodic pension cost and the cost of other postretirement benefits forthe three months and nine months ended September 30, 2005 and 2004 wereasfollows:

|                              |  |                                     |      |                                      |  |                                    |      |                                   |  |        |       |         |  |        |       |         |  |  |
|------------------------------|--|-------------------------------------|------|--------------------------------------|--|------------------------------------|------|-----------------------------------|--|--------|-------|---------|--|--------|-------|---------|--|--|
|                         |  | PensionBenefits                     |
| (dollars inmillions)         |  | Three Months endedSeptember 30,2005 |      | Three Months ended September30, 2004 |  | Nine Monthsended September 30,2005 |      | Nine MonthsendedSeptember 30,2004 |
| Servicecost                  |  | $                                   | 7.9  |                                 |  | $                                  | 6.6  |                              |  | $      | 21.3  |    |  | $      | 21.1  |    |
| Interestcost                 |  |                                | 10.8 |                                 |  |                               | 9.0  |                              |  |   | 30.3  |    |  |   | 29.1  |    |
| Expectedreturn on planassets |  |                                | (6.9 | )                               |  |                               | (6.3 | )                            |  |   | (19.1 | )  |  |   | (19.9 | )  |
| Netperiodiccost              |  | $                                   | 11.8 |                                 |  | $                                  | 9.3  |                              |  | $      | 32.5  |    |  | $      | 30.3  |    |
|                              |

|                                  |  |                                      |      |                                      |  |                                     |         |                                     |  |        |      |         |  |        |         |        |  |  |
|----------------------------------|--|--------------------------------------|------|--------------------------------------|--|-------------------------------------|---------|-------------------------------------|--|--------|------|---------|--|--------|---------|--------|--|--|
|                             |  | OtherPostretirement Benefits         |
| (dollars inmillions)             |  | Three Months endedSeptember 30, 2005 |      | Three Months ended September30, 2004 |  | Nine Months ended September 30,2005 |         | Nine Months ended September 30,2004 |
| Servicecost                      |  | $                                    | 1.4  |                                 |  | $                                   | 1.2     |                                |  | $      | 4.1  |    |  | $      | 4.1     |   |
| Interestcost                     |  |                                 | 2.2  |                                 |  |                                | 1.8     |                                |  |   | 6.5  |    |  |   | 6.2     |   |
| Amortizationof prior servicecost |  |                                 | (1.0 | )                               |  |                                | — |                                |  |   | (3.0 | )  |  |   | — |   |
| Netperiodiccost                  |  | $                                    | 2.6  |                                 |  | $                                   | 3.0     |                                |  | $      | 7.6  |    |  | $      | 10.3    |   |
|                                  |

InJanuary 2005, final regulations implementing the Medicare PrescriptionDrug, Improvement, and Modernization Act of 2003 (the Act) were issuedby the Centers for Medicare & Medicaid Services (CMS) of the U.S.Department of Health and Human Services. The final regulations clarifyhow companies providing retiree prescription drug benefits shoulddetermine if those benefits are actuarially equivalent to Medicare PartD coverage. Under the Act, a federal subsidy is available, beginning inJanuary 2006, to those companies providing prescription drug benefitsthat are actuarially equivalent to Medicare Part D coverage.

Based on the proposed regulations issued by CMS in July 2004, theCompany concluded that its retiree prescription drug benefit plan wasnot actuarially equivalent to Medicare Part D coverage and that it didnot qualify for the subsidy provided by the Act. However, as a resultof the final regulations 

8

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NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements  (continued)(Unaudited)

September 30,2005

6.    Pensionand Other Postretirement Benefit Plans   (continued)

issued in January 2005, the Company hasdetermined that its plan is actuarially equivalent, and the Companywill qualify for the subsidy.

As a result of qualifying for thesubsidy, the accumulated benefit obligation for the Company'sdefined postretirement benefit plans other than pensions has beenreduced by approximately $25.4 million as of January 2005. The serviceand interest cost components of other postretirement benefits expensewas reduced by $0.4 million and $0.4 million, respectively, for thenine months ended September 30, 2005.

7.    Business Optimization Expenses

Inaddition to the Company's plan to exit or restructure certainactivities that was formulated in conjunction with the Acquisition, theCompany is continuing to redesign and optimize its business and workprocesses. In June 2005, the Company also announced a plan to de-layerits management structure and to reduce costs in lower-performingbusiness units. The plan calls for the elimination of approximately 220positions, primarily in Europe and North America.

Businessprocess optimization expenses, consisting mostly of employee severanceand related costs, were $3.5 million and $21.3 million for the threemonths and nine months ended September  30,  2005,respectively, and included a $14.2 million accrual for therestructuring plan announced in June 2005. As of September 30, 2005,$3.6 million had been charged against the accrual.

8.    Summary of Other Income (Expense)

The components of other income (expense), net for the three monthsand nine months ended September 30, 2005 and 2004, include thefollowing:

|                                                 |  |                                   |         |                                   |  |                                  |         |                                 |  |        |         |         |  |        |         |         |  |  |
|-------------------------------------------------|--|-----------------------------------|---------|-----------------------------------|--|----------------------------------|---------|---------------------------------|--|--------|---------|---------|--|--------|---------|---------|--|--|
| (dollarsin millions)                            |  | ThreeMonthsendedSeptember 30,2005 |         | ThreeMonthsendedSeptember 30,2004 |  | NineMonthsendedSeptember 30,2005 |         | NineMonthsendedSeptember30,2004 |
| Impairment loss on business held forsale        |  | $                                 | — |                              |  | $                                | — |                            |  | $      | (2.4    | )  |  | $      | — |    |
| Sponsormonitoringfees                           |  |                              | — |                              |  |                             | (2.7    | )                          |  |   | — |    |  |   | (8.4    | )  |
| Franchisetaxes                                  |  |                              | (0.6    | )                            |  |                             | (0.8    | )                          |  |   | (1.9    | )  |  |   | (2.3    | )  |
| Equityin earnings of unconsolidatedsubsidiaries |  |                              | 0.3     |                              |  |                             | 1.1     |                            |  |   | 1.1     |    |  |   | 2.4     |    |
| Foreigncurrency exchangeadjustments             |  |                              | 1.9     |                              |  |                             | 0.2     |                            |  |   | 3.3     |    |  |   | (1.0    | )  |
| Other                                           |  |                              | (1.6    | )                            |  |                             | 1.0     |                            |  |   | (2.9    | )  |  |   | 2.8     |    |
|                                            |  | $                                 | — |                              |  | $                                | (1.2    | )                          |  | $      | (2.8    | )  |  | $      | (6.5    | )  |
|                                                 |

9.    IncomeTaxes

The Company's effective income tax rate was44.9% for the nine months ended September  30,2005. The rate varies from the U.S. statutory income tax rate of35% due primarily to the incremental tax on dividends receivedfrom non-U.S. subsidiaries, foreign taxes provided at less than the35% U.S. statutory rate, U.S. state income taxes, nondeductibleexpenses, and other permanent differences.

The aforementioneditems also contributed to the variation between the U.S. statutoryincome tax rate and the Company's effective income tax rate forthe nine months ended September 30, 2004. In addition, the effectiverate was impacted by the charge for purchased IPR&D, which is nottax deductible.

9

----

NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements  (continued)(Unaudited)

September 30,2005

9.    IncomeTaxes   (continued)

The effective rate of the provision forincome taxes differs from the U.S. statutory tax rate due to thefollowing items:

|                       |  |                                   |         |                                   |  |                                  |         |                                   |  |        |         |        |  |        |       |         |  |  |
|-----------------------|--|-----------------------------------|---------|-----------------------------------|--|----------------------------------|---------|-----------------------------------|--|--------|---------|--------|--|--------|-------|---------|--|--|
| (dollars inmillions)  |  | ThreeMonthsendedSeptember 30,2005 |         | ThreeMonthsendedSeptember 30,2004 |  | NineMonthsendedSeptember 30,2005 |         | NineMonthsendedSeptember 30, 2004 |
| U.S.statutory taxrate |  | $                                 | 16.0    |                              |  | $                                | 14.5    |                              |  | $      | 26.4    |   |  | $      | (15.3 | )  |
| IPR&D             |  |                              | — |                              |  |                             | — |                              |  |   | — |   |  |   | 42.8  |    |
| Other                 |  |                              | 5.0     |                              |  |                             | 12.7    |                              |  |   | 7.5     |   |  |   | 19.3  |    |
| Incometaxprovision    |  | $                                 | 21.0    |                              |  | $                                | 27.2    |                              |  | $      | 33.9    |   |  | $      | 46.8  |    |
|                       |

TheAmerican Jobs Creation Act of 2004 (the Jobs Creation Act) created aone-time incentive for American companies to repatriate earnings fromtheir foreign subsidiaries. The Company has completed a comparison ofthe benefits available to it under the Jobs Creation Act to those underother strategies for global cash and debt management, and it hascompared the benefits of implementing the incentive to the costsrequired to implement it. Based upon this analysis, the Company hasdecided not to structure its earnings repatriation under the provisionsof the Jobs Creation Act.

10.    ComprehensiveIncome (Loss)

Total comprehensive income (loss) and itscomponents, net of related tax, for the three months and nine monthsended September 30, 2005 and 2004, are as follows:

|                                                       |  |                                   |        |                                   |  |                                  |         |                                  |  |        |        |         |  |        |         |         |  |  |
|-------------------------------------------------------|--|-----------------------------------|--------|-----------------------------------|--|----------------------------------|---------|----------------------------------|--|--------|--------|---------|--|--------|---------|---------|--|--|
| (dollarsin millions)                                  |  | ThreeMonthsendedSeptember 30,2005 |        | ThreeMonthsendedSeptember 30,2004 |  | NineMonthsendedSeptember 30,2005 |         | NineMonthsendedSeptember 30,2004 |
| Netearnings(loss)                                     |  | $                                 | 23.2   |                              |  | $                                | 12.4    |                             |  | $      | 37.2   |    |  | $      | (94.2   | )  |
| Othercomprehensive income (loss), net of incometaxes: |  |                              |   |                              |  |                             |    |                             |  |   |   |    |  |   |    |    |
| Derivatives                                           |  |                              | (0.4   | )                            |  |                             | — |                             |  |   | 0.3    |    |  |   | — |    |
| Foreigncurrency translationadjustments                |  |                              | 3.9    |                              |  |                             | 44.3    |                             |  |   | (42.1  | )  |  |   | (18.3   | )  |
| Comprehensiveincome(loss)                             |  | $                                 | 26.7   |                              |  | $                                | 56.7    |                             |  | $      | (4.6   | )  |  | $      | (112.5  | )  |
|                                                       |

11.    SegmentInformation

The Company provides integrated water treatment andprocess improvement services for industrial and institutionalapplications, using technologically advanced solutions, combiningchemical products and equipment, and consistent, reliable on-siteservice and expertise. These solutions and services enable theCompany's customers to improve production yields, lowermanufacturing costs, extend asset lives and maintain environmentalstandards at costs that represent a small share of their overallproduction expense.

10

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NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements  (continued)(Unaudited)

September 30,2005

11.    SegmentInformation   (continued)

The Company is organized based onthe end markets it serves. The organization is comprised of thefollowing reportable segments:

Industrial andInstitutional Services – This segment serves the globalwater treatment and process chemical needs of the industrial,institutional, and municipal markets.

EnergyServices – This segment serves the process chemicals andwater treatment needs of the global petroleum and petrochemicalindustries in both upstream and downstream applications.

Paper Services – This segment serves theprocess chemicals and water treatment needs of the global pulp andpaper industry.

Other – This segmentserves the alternative channels to market, supply chain activities, andcertain other operating expenses not allocated to a segment. It alsoincludes the Company's subsidiary in India and the Katayama Nalcojoint venture.

The Company evaluates the performance ofits segments based on "direct contribution",which is defined as net sales, less cost of products sold (excludingvariances to standard costs), selling and service expenses, marketingexpenses and research expenses directly attributable to each segment.There are no intersegment revenues. Prior year data have beenreclassified between segments to conform to the current yearpresentation.

Net sales by reportable segment were asfollows:

|                                      |  |                                    |       |                                    |  |                                   |       |                                  |  |        |         |        |  |        |         |        |  |  |
|--------------------------------------|--|------------------------------------|-------|------------------------------------|--|-----------------------------------|-------|----------------------------------|--|--------|---------|--------|--|--------|---------|--------|--|--|
| (dollarsin millions)                 |  | Three MonthsendedSeptember 30,2005 |       | Three Monthsended September30,2004 |  | Nine Monthsended September30,2005 |       | Nine MonthsendedSeptember30,2004 |
| Industrial and InstitutionalServices |  | $                                  | 382.4 |                               |  | $                                 | 354.0 |                             |  | $      | 1,106.6 |   |  | $      | 1,032.4 |   |
| EnergyServices                       |  |                               | 222.7 |                               |  |                              | 200.4 |                             |  |   | 653.4   |   |  |   | 593.0   |   |
| PaperServices                        |  |                               | 174.2 |                               |  |                              | 164.6 |                             |  |   | 520.8   |   |  |   | 489.9   |   |
| Other                                |  |                               | 55.6  |                               |  |                              | 55.2  |                             |  |   | 168.0   |   |  |   | 112.6   |   |
| Netsales                             |  | $                                  | 834.9 |                               |  | $                                 | 774.2 |                             |  | $      | 2,448.8 |   |  | $      | 2,227.9 |   |
|                                      |

Thefollowing table presents direct contribution by reportable segment andreconciles the total segment direct contribution to earnings (loss)before income taxes:

|                                     |  |                                     |         |                                    |  |                                   |         |                                  |  |        |         |         |  |        |         |         |  |  |
|-------------------------------------|--|-------------------------------------|---------|------------------------------------|--|-----------------------------------|---------|----------------------------------|--|--------|---------|---------|--|--------|---------|---------|--|--|
| (dollarsin millions)                |  | Three Months endedSeptember 30,2005 |         | Three Monthsended September30,2004 |  | Nine Monthsended September30,2005 |         | Nine MonthsendedSeptember30,2004 |
| Segment directcontribution:         |  |                                |    |                               |  |                              |    |                             |  |   |    |    |  |   |    |    |
| Industrialand InstitutionalServices |  | $                                   | 98.0    |                               |  | $                                 | 88.2    |                             |  | $      | 267.2   |    |  | $      | 258.7   |    |
| EnergyServices                      |  |                                | 47.3    |                               |  |                              | 42.1    |                             |  |   | 138.7   |    |  |   | 130.4   |    |
| PaperServices                       |  |                                | 35.1    |                               |  |                              | 37.0    |                             |  |   | 101.6   |    |  |   | 115.5   |    |
| Other                               |  |                                | (14.3   | )                             |  |                              | (7.9    | )                           |  |   | (48.5   | )  |  |   | (56.3   | )  |
| Totalsegment directcontribution     |  |                                | 166.1   |                               |  |                              | 159.4   |                             |  |   | 459.0   |    |  |   | 448.3   |    |
|                                |  |                                |    |                               |  |                              |    |                             |  |   |    |    |  |   |    |    |
| Expensesnot allocated tosegments:   |  |                                |    |                               |  |                              |    |                             |  |   |    |    |  |   |    |    |
| Administrativeexpenses              |  |                                | 40.3    |                               |  |                              | 41.6    |                             |  |   | 133.4   |    |  |   | 138.3   |    |
| Amortizationof intangibleassets     |  |                                | 20.3    |                               |  |                              | 23.9    |                             |  |   | 61.4    |    |  |   | 73.0    |    |
| In-processresearch anddevelopment   |  |                                | — |                               |  |                              | — |                             |  |   | — |    |  |   | 122.3   |    |
| Businessoptimizationexpenses        |  |                                | 3.5     |                               |  |                              | — |                             |  |   | 21.3    |    |  |   | — |    |
| Operatingearnings                   |  |                                | 102.0   |                               |  |                              | 93.9    |                             |  |   | 242.9   |    |  |   | 114.7   |    |
| Otherincome (expense),net           |  |                                | — |                               |  |                              | (1.2    | )                           |  |   | (2.8    | )  |  |   | (6.5    | )  |
| Interestincome                      |  |                                | 2.1     |                               |  |                              | 2.3     |                             |  |   | 6.2     |    |  |   | 7.7     |    |
| Interestexpense                     |  |                                | (58.3   | )                             |  |                              | (53.7   | )                           |  |   | (170.8  | )  |  |   | (159.7  | )  |
| Earnings(loss) before incometaxes   |  | $                                   | 45.8    |                               |  | $                                 | 41.3    |                             |  | $      | 75.5    |    |  | $      | (43.8   | )  |
|                                     |

11

----

NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements  (continued)(Unaudited)

September 30,2005

11.    SegmentInformation   (continued)

Total segment direct contributionfor the nine months ended September 30, 2005 includes inventorywrite-offs of $9.0 million. Of this amount, $4.0 million, $2.9 million,$1.7 million, and $0.4 million was charged to Paper Services, Other,Energy Services, and Industrial and Institutional Services,respectively.

12.    Contingenciesand Litigation

Various claims, lawsuits and administrativeproceedings are pending or threatened against the Company and itssubsidiaries, arising from the ordinary course of business with respectto commercial, intellectual property, product liability, employee andenvironmental matters. Historically, these matters have not had amaterial impact on the consolidated financial position of the Company.However, the Company cannot predict the outcome of any litigation orthe potential for future litigation.

The Company has been namedas a potentially responsible party (PRP) by the EnvironmentalProtection Agency or state enforcement agencies at three waste siteswhere some financial contribution is or may be required. These agencieshave also identified many other parties who may be responsible forclean up costs at these waste disposal sites. The Company'sfinancial contribution to remediate these sites is expected to beminor. There has been no significant financial impact on the Company upto the present, nor is it anticipated that there will be in the future,as a result of these matters. The Company has made and will continue tomake provisions for these costs if the Company's liabilitybecomes probable and when costs can be reasonably estimated.

TheCompany's undiscounted reserves for known environmental clean upcosts were $2.0 million at September 30, 2005.

Theseenvironmental reserves represent management's current estimate ofits proportional clean-up costs and are based upon negotiation andagreement with enforcement agencies, its previous experience withrespect to clean-up activities, a detailed review by the Company ofknown conditions, and information about other PRPs. They are notreduced by any possible recoveries from insurance companies or otherPRPs not specifically identified. Although management cannot determinewhether or not a material effect on future operations is reasonablylikely to occur, given the evolving nature of environmentalregulations, it believes that the recorded reserve levels areappropriate estimates of the potential liability. Although settlementwill require future cash outlays, it is not expected that such outlayswill materially impact the Company's liquidity position.Expenditures for the nine months ended September 30, 2005, relating toenvironmental compliance and clean up activities, were notsignificant.

The Company has been named as a defendant inlawsuits based on claimed involvement in the supply of allegedlydefective or hazardous materials. The plaintiffs in these cases seekdamages for alleged personal injury or potential injury resulting fromexposure to our products or other chemicals. These matters have had ade minimis impact on the Company's business historically and theCompany does not anticipate these matters to present any material riskto the Company's business in the future. Notwithstanding, theCompany cannot predict the outcome of any such lawsuits or theinvolvement the Company might have in these matters in the future.

The U.K. Health and Safety Executive("HSE") has sent notice that it intends toinitiate legal proceedings against the Company's U.K. subsidiaryunder the Health and Safety at Work Act. The place of these proceedingsis not indicated in the notice. This notice references a legionellaoutbreak that is claimed to have originated at cooling towers owned byone of the subsidiary's customers. The HSE indicates that theproceedings will relate to the cleaning of these cooling towers. TheCompany 

12

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NalcoHoldings LLC and SubsidiariesNotes to Condensed ConsolidatedFinancialStatements  (continued)(Unaudited)

September 30,2005

12.    Contingenciesand Litigation   (continued)

has not received any specific charges orclaims for relief, but will, in any event, defend and refute anycontention that it has violated any law.

The Company hasreceived subpoenas from the U.S. Department of Justice for documentsand testimony relating to its storage of claimed hazardous materials,the claimed leakage of wastewater and other matters at its plant inGaryville, Louisiana. No charges or indictments have been filed, butthe outcome of this investigation is unknown to the Company.

Inthe ordinary course of its business, the Company is also a party to anumber of lawsuits and is subject to various claims relating totrademarks, employee matters, contracts, transactions, chemicals andother matters, the outcome of which, in the opinion of management,should not have a material effect on the consolidated financialposition of the Company. However, we cannot predict the outcome of anylitigation or the potential for future litigation. Were an unfavorableruling to occur, there exists the possibility of a material adverseimpact on the results of operations for the period in which the rulingoccurs. The Company maintains accruals where the outcome of the matteris probable and can be reasonably estimated.

13.    Guarantees

No significant guarantees were outstanding at September 30, 2005,other than subsidiary-related performance guarantees.

TheCompany had $37.0 million of letters of credit outstanding at September30, 2005.

14.    SupplementalGuarantor Condensed Financial Statements

In connection with theAcquisition, Nalco Holdings LLC (presented as Parent in the followingtables), through its wholly owned subsidiary, Nalco Company (presentedas Issuer in the following tables), issued Senior Notes and SeniorSubordinated Notes as further described in Note 4. The Senior Notes arefully, unconditionally and jointly and severally guaranteed on anunsecured senior basis and the Senior Subordinated Notes are fully,unconditionally and jointly and severally guaranteed on an unsecuredsenior subordinated basis, in each case, by Nalco Holdings LLC and bysubstantially all existing and future wholly-owned restricted domesticsubsidiaries of Nalco Company (collectively, the"Guarantors"). All other subsidiaries ofNalco Holdings LLC, whether direct or indirect, do not guarantee theSenior Notes and Senior Subordinated Notes("Non-Guarantors"). The Guarantors alsounconditionally guarantee the Company's borrowings under theSenior Secured Credit Facilities on a senior secured basis.

Thefollowing unaudited condensed consolidating financial statementspresent the results of operations, financial position and cash flows of(1) the Parent, (2) the Issuer, (3) the Guarantors, (4)  theNon-Guarantors and (5) eliminations to arrive at the information forNalco Holdings LLC on a consolidated basis. Separate financialstatements and other disclosures concerning the Guarantors are notpresented because management does not believe that such information ismaterial to investors.

13

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Nalco Holdings LLC andSubsidiaries Condensed Consolidating Balance Sheet September30, 2005(dollars inmillions)

|                                                           |  |        |         |        |  |                       |         |                           |  |              |         |              |  |        |         |        |  |        |          |         |  |        |         |        |  |  |
|-----------------------------------------------------------|--|--------|---------|--------|--|-----------------------|---------|---------------------------|--|--------------|---------|--------------|--|--------|---------|--------|--|--------|----------|---------|--|--------|---------|--------|--|--|
|                                                      |  | Parent |         | Issuer |  | GuarantorSubsidiaries |         | Non-GuarantorSubsidiaries |  | Eliminations |         | Consolidated |
| Cash& cash equivalents                                |  | $      | — |   |  | $                     | 1.7     |                      |  | $            | 2.2     |         |  | $      | 42.8    |   |  | $      | —  |    |  | $      | 46.7    |   |
| Trade accountsreceivable                                  |  |   | — |   |  |                  | (16.4   | )                    |  |         | (4.8    | )       |  |   | 619.9   |   |  |   | —  |    |  |   | 598.7   |   |
| Inventories– finishedproducts                       |  |   | — |   |  |                  | 64.8    |                      |  |         | 41.0    |         |  |   | 133.2   |   |  |   | —  |    |  |   | 239.0   |   |
| Inventories– materials & work inprocess         |  |   | — |   |  |                  | 13.6    |                      |  |         | 12.2    |         |  |   | 45.1    |   |  |   | —  |    |  |   | 70.9    |   |
| Receivablesfrom relatedparties                            |  |   | — |   |  |                  | 32.9    |                      |  |         | 212.1   |         |  |   | 22.8    |   |  |   | (267.8   | )  |  |   | — |   |
| Prepaidexpenses, taxes, and other currentassets           |  |   | — |   |  |                  | 11.7    |                      |  |         | 16.2    |         |  |   | 62.0    |   |  |   | —  |    |  |   | 89.9    |   |
| **TotalCurrentAssets**                                    |  |   | — |   |  |                  | 108.3   |                      |  |         | 278.9   |         |  |   | 925.8   |   |  |   | (267.8   | )  |  |   | 1,045.2 |   |
| Property,plant, and equipment,net                         |  |   | — |   |  |                  | 243.0   |                      |  |         | 145.4   |         |  |   | 374.8   |   |  |   | —  |    |  |   | 763.2   |   |
| Investmentinsubsidiaries                                  |  |   | 1,026.0 |   |  |                  | 2,440.0 |                      |  |         | 368.5   |         |  |   | — |   |  |   | (3,834.5 | )  |  |   | — |   |
| Goodwill                                                  |  |   | — |   |  |                  | 648.3   |                      |  |         | 318.2   |         |  |   | 1,254.3 |   |  |   | —  |    |  |   | 2,220.8 |   |
| Intangibles                                               |  |   | — |   |  |                  | 1,022.8 |                      |  |         | 50.6    |         |  |   | 178.8   |   |  |   | —  |    |  |   | 1,252.2 |   |
| Otherassets                                               |  |   | — |   |  |                  | 291.1   |                      |  |         | 311.6   |         |  |   | 203.9   |   |  |   | (457.9   | )  |  |   | 348.7   |   |
| **TotalAssets**                                           |  | $      | 1,026.0 |   |  | $                     | 4,753.5 |                      |  | $            | 1,473.2 |         |  | $      | 2,937.6 |   |  | $      | (4,560.2 | )  |  | $      | 5,630.1 |   |
|                                                      |  |   |    |   |  |                  |    |                      |  |         |    |         |  |   |    |   |  |   |     |    |  |   |    |   |
| Accountspayable                                           |  | $      | — |   |  | $                     | 82.2    |                      |  | $            | 38.2    |         |  | $      | 145.6   |   |  | $      | —  |    |  | $      | 266.0   |   |
| Short-termdebt                                            |  |   | — |   |  |                  | — |                      |  |         | 1.3     |         |  |   | 17.2    |   |  |   | —  |    |  |   | 18.5    |   |
| Othercurrentliabilities                                   |  |   | — |   |  |                  | 76.0    |                      |  |         | 32.7    |         |  |   | 158.9   |   |  |   | —  |    |  |   | 267.6   |   |
| Intercompanyaccountspayable                               |  |   | — |   |  |                  | 124.3   |                      |  |         | 38.9    |         |  |   | 104.6   |   |  |   | (267.8   | )  |  |   | — |   |
| **TotalCurrentLiabilities**                               |  |   | — |   |  |                  | 282.5   |                      |  |         | 111.1   |         |  |   | 426.3   |   |  |   | (267.8   | )  |  |   | 552.1   |   |
| Long-termdebt                                             |  |   | — |   |  |                  | 2,840.5 |                      |  |         | — |         |  |   | 79.8    |   |  |   | —  |    |  |   | 2,920.3 |   |
| Deferredincometaxes                                       |  |   | — |   |  |                  | 312.4   |                      |  |         | 8.6     |         |  |   | 97.1    |   |  |   | —  |    |  |   | 418.1   |   |
| Accruedpensionbenefits                                    |  |   | — |   |  |                  | 235.7   |                      |  |         | 41.7    |         |  |   | 140.0   |   |  |   | —  |    |  |   | 417.4   |   |
| Intercompanynotes payable–longterm                  |  |   | — |   |  |                  | 457.3   |                      |  |         | — |         |  |   | 0.6     |   |  |   | (457.9   | )  |  |   | — |   |
| Otherliabilities                                          |  |   | — |   |  |                  | 245.4   |                      |  |         | 27.4    |         |  |   | 23.4    |   |  |   | —  |    |  |   | 296.2   |   |
| **TotalOtherLiabilities**                                 |  |   | — |   |  |                  | 4,091.3 |                      |  |         | 77.7    |         |  |   | 340.9   |   |  |   | (457.9   | )  |  |   | 4,052.0 |   |
| **MinorityInterest**                                      |  |   | 12.6    |   |  |                  | — |                      |  |         | — |         |  |   | 12.6    |   |  |   | (12.6    | )  |  |   | 12.6    |   |
| **TotalUnitholder's/Shareholders'Equity**                 |  |   | 1,013.4 |   |  |                  | 379.7   |                      |  |         | 1,284.4 |         |  |   | 2,157.8 |   |  |   | (3,821.9 | )  |  |   | 1,013.4 |   |
| **TotalLiabilities and Unitholder's/Shareholders'Equity** |  | $      | 1,026.0 |   |  | $                     | 4,753.5 |                      |  | $            | 1,473.2 |         |  | $      | 2,937.6 |   |  | $      | (4,560.2 | )  |  | $      | 5,630.1 |   |
|                                                           |

14

----

Nalco Holdings LLC and SubsidiariesCondensed Consolidating Balance Sheet December 31, 2004(dollars inmillions)

|                                                           |  |        |         |        |  |                       |         |                           |  |              |         |              |  |        |         |        |  |        |          |         |  |        |         |        |  |  |
|-----------------------------------------------------------|--|--------|---------|--------|--|-----------------------|---------|---------------------------|--|--------------|---------|--------------|--|--------|---------|--------|--|--------|----------|---------|--|--------|---------|--------|--|--|
|                                                      |  | Parent |         | Issuer |  | GuarantorSubsidiaries |         | Non-GuarantorSubsidiaries |  | Eliminations |         | Consolidated |
| Cash& cash equivalents                                |  | $      | — |   |  | $                     | 1.3     |                      |  | $            | 0.8     |         |  | $      | 31.1    |   |  | $      | —  |    |  | $      | 33.2    |   |
| Trade accountsreceivable                                  |  |   | — |   |  |                  | (16.4   | )                    |  |         | 4.4     |         |  |   | 606.2   |   |  |   | —  |    |  |   | 594.2   |   |
| Inventories– finishedproducts                       |  |   | — |   |  |                  | 70.6    |                      |  |         | 47.8    |         |  |   | 127.0   |   |  |   | —  |    |  |   | 245.4   |   |
| Inventories– materials & work inprocess         |  |   | — |   |  |                  | 13.9    |                      |  |         | 15.6    |         |  |   | 38.6    |   |  |   | —  |    |  |   | 68.1    |   |
| Notesreceivable from relatedparties                       |  |   | — |   |  |                  | 17.4    |                      |  |         | 133.7   |         |  |   | 24.3    |   |  |   | (175.4   | )  |  |   | — |   |
| Otherreceivables from relatedparties                      |  |   | — |   |  |                  | 1.2     |                      |  |         | 296.4   |         |  |   | 95.4    |   |  |   | (393.0   | )  |  |   | — |   |
| Prepaidexpenses, taxes, and other currentassets           |  |   | — |   |  |                  | 36.4    |                      |  |         | 6.9     |         |  |   | 46.8    |   |  |   | —  |    |  |   | 90.1    |   |
| **TotalCurrentAssets**                                    |  |   | — |   |  |                  | 124.4   |                      |  |         | 505.6   |         |  |   | 969.4   |   |  |   | (568.4   | )  |  |   | 1,031.0 |   |
| Property,plant, and equipment,net                         |  |   | — |   |  |                  | 270.4   |                      |  |         | 152.3   |         |  |   | 424.6   |   |  |   | —  |    |  |   | 847.3   |   |
| Investmentinsubsidiaries                                  |  |   | 1,031.8 |   |  |                  | 2,437.6 |                      |  |         | 368.9   |         |  |   | — |   |  |   | (3,838.3 | )  |  |   | — |   |
| Goodwill                                                  |  |   | — |   |  |                  | 719.3   |                      |  |         | 318.2   |         |  |   | 1,330.8 |   |  |   | —  |    |  |   | 2,368.3 |   |
| Intangibles                                               |  |   | — |   |  |                  | 1,047.6 |                      |  |         | 58.6    |         |  |   | 217.4   |   |  |   | —  |    |  |   | 1,323.6 |   |
| Otherassets                                               |  |   | — |   |  |                  | 300.1   |                      |  |         | 19.9    |         |  |   | 43.5    |   |  |   | —  |    |  |   | 363.5   |   |
| **TotalAssets**                                           |  | $      | 1,031.8 |   |  | $                     | 4,899.4 |                      |  | $            | 1,423.5 |         |  | $      | 2,985.7 |   |  | $      | (4,406.7 | )  |  | $      | 5,933.7 |   |
| Accountspayable                                           |  | $      | — |   |  | $                     | 77.4    |                      |  | $            | 39.9    |         |  | $      | 144.6   |   |  | $      | —  |    |  | $      | 261.9   |   |
| Short-termdebt                                            |  |   | — |   |  |                  | 4.2     |                      |  |         | 0.4     |         |  |   | 13.1    |   |  |   | —  |    |  |   | 17.7    |   |
| Othercurrentliabilities                                   |  |   | — |   |  |                  | 50.5    |                      |  |         | 62.6    |         |  |   | 198.6   |   |  |   | —  |    |  |   | 311.7   |   |
| Intercompanyaccountspayable                               |  |   | — |   |  |                  | 53.7    |                      |  |         | 35.9    |         |  |   | 85.8    |   |  |   | (175.4   | )  |  |   | — |   |
| **TotalCurrentLiabilities**                               |  |   | — |   |  |                  | 185.8   |                      |  |         | 138.8   |         |  |   | 442.1   |   |  |   | (175.4   | )  |  |   | 591.3   |   |
| Long-termdebt                                             |  |   | — |   |  |                  | 3,002.1 |                      |  |         | — |         |  |   | 98.5    |   |  |   | —  |    |  |   | 3,100.6 |   |
| Deferredincometaxes                                       |  |   | — |   |  |                  | 401.0   |                      |  |         | (2.6    | )       |  |   | 103.1   |   |  |   | —  |    |  |   | 501.5   |   |
| Accruedpensionbenefits                                    |  |   | — |   |  |                  | 226.4   |                      |  |         | 37.2    |         |  |   | 148.1   |   |  |   | —  |    |  |   | 411.7   |   |
| Intercompanynotes payable–longterm                  |  |   | — |   |  |                  | 391.6   |                      |  |         | — |         |  |   | 1.4     |   |  |   | (393.0   | )  |  |   | — |   |
| Otherliabilities                                          |  |   | — |   |  |                  | 241.9   |                      |  |         | 27.3    |         |  |   | 27.6    |   |  |   | —  |    |  |   | 296.8   |   |
| **TotalOtherLiabilities**                                 |  |   | — |   |  |                  | 4,263.0 |                      |  |         | 61.9    |         |  |   | 378.7   |   |  |   | (393.0   | )  |  |   | 4,310.6 |   |
| **MinorityInterest**                                      |  |   | 14.1    |   |  |                  | — |                      |  |         | — |         |  |   | 14.1    |   |  |   | (14.1    | )  |  |   | 14.1    |   |
| **Unitholder's/Shareholders'Equity**                      |  |   | 1,017.7 |   |  |                  | 450.6   |                      |  |         | 1,222.8 |         |  |   | 2,150.8 |   |  |   | (3,824.2 | )  |  |   | 1,017.7 |   |
| **TotalLiabilities and Unitholder's/Shareholders'Equity** |  | $      | 1,031.8 |   |  | $                     | 4,899.4 |                      |  | $            | 1,423.5 |         |  | $      | 2,985.7 |   |  | $      | (4,406.7 | )  |  | $      | 5,933.7 |   |
|                                                           |

15

----

Nalco Holdings LLC and SubsidiariesCondensed Consolidating Statement of Operations Three Months endedSeptember 30, 2005(dollars inmillions)

|                                              |  |        |         |         |  |                       |         |                           |  |              |         |              |  |        |        |         |  |        |         |         |  |        |         |         |  |  |
|----------------------------------------------|--|--------|---------|---------|--|-----------------------|---------|---------------------------|--|--------------|---------|--------------|--|--------|--------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                         |  | Parent |         | Issuer  |  | GuarantorSubsidiaries |         | Non-GuarantorSubsidiaries |  | Eliminations |         | Consolidated |
| **Netsales**                                 |  | $      | — |    |  | $                     | 300.4   |                      |  | $            | 149.7   |         |  | $      | 459.3  |    |  | $      | (74.5   | )  |  | $      | 834.9   |    |
| Operatingcosts andexpenses:                  |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |   |    |  |   |    |    |  |   |    |    |
| Costof productsold                           |  |   | — |    |  |                  | 187.5   |                      |  |         | 99.1    |         |  |   | 245.5  |    |  |   | (74.5   | )  |  |   | 457.6   |    |
| Selling,administrative, and researchexpenses |  |   | — |    |  |                  | 94.5    |                      |  |         | 28.3    |         |  |   | 128.7  |    |  |   | — |    |  |   | 251.5   |    |
| Amortizationof intangibleassets              |  |   | — |    |  |                  | 8.4     |                      |  |         | 2.7     |         |  |   | 9.2    |    |  |   | — |    |  |   | 20.3    |    |
| Businessoptimizationexpenses                 |  |   | — |    |  |                  | 0.9     |                      |  |         | — |         |  |   | 2.6    |    |  |   | — |    |  |   | 3.5     |    |
| Totaloperating costs andexpenses             |  |   | — |    |  |                  | 291.3   |                      |  |         | 130.1   |         |  |   | 386.0  |    |  |   | (74.5   | )  |  |   | 732.9   |    |
| **Operatingearnings(loss)**                  |  |   | — |    |  |                  | 9.1     |                      |  |         | 19.6    |         |  |   | 73.3   |    |  |   | — |    |  |   | 102.0   |    |
| Otherincome (expense),net                    |  |   | 24.8    |    |  |                  | 16.2    |                      |  |         | 8.5     |         |  |   | (19.1  | )  |  |   | (30.4   | )  |  |   | — |    |
| Interestincome                               |  |   | — |    |  |                  | 1.7     |                      |  |         | 3.5     |         |  |   | 10.8   |    |  |   | (13.9   | )  |  |   | 2.1     |    |
| Interestexpense                              |  |   | — |    |  |                  | (67.0   | )                    |  |         | (3.4    | )       |  |   | (1.8   | )  |  |   | 13.9    |    |  |   | (58.3   | )  |
| Earnings(loss) before incometaxes            |  |   | 24.8    |    |  |                  | (40.0   | )                    |  |         | 28.2    |         |  |   | 63.2   |    |  |   | (30.4   | )  |  |   | 45.8    |    |
| Incometax provision(benefit)                 |  |   | — |    |  |                  | (1.1    | )                    |  |         | 9.7     |         |  |   | 12.4   |    |  |   | — |    |  |   | 21.0    |    |
| Minorityinterests                            |  |   | (1.6    | )  |  |                  | — |                      |  |         | — |         |  |   | (1.7   | )  |  |   | 1.7     |    |  |   | (1.6    | )  |
| **Netearnings(loss)**                        |  | $      | 23.2    |    |  | $                     | (38.9   | )                    |  | $            | 18.5    |         |  | $      | 49.1   |    |  | $      | (28.7   | )  |  | $      | 23.2    |    |
|                                              |

16

----

Nalco Holdings LLC and SubsidiariesCondensed Consolidating Statement of Operations Three Months endedSeptember 30, 2004(dollars inmillions)

|                                              |  |        |         |         |  |                       |         |                           |  |              |         |              |  |        |        |         |  |        |         |         |  |        |        |         |  |  |
|----------------------------------------------|--|--------|---------|---------|--|-----------------------|---------|---------------------------|--|--------------|---------|--------------|--|--------|--------|---------|--|--------|---------|---------|--|--------|--------|---------|--|--|
|                                         |  | Parent |         | Issuer  |  | GuarantorSubsidiaries |         | Non-GuarantorSubsidiaries |  | Eliminations |         | Consolidated |
| **Netsales**                                 |  | $      | — |    |  | $                     | 278.5   |                      |  | $            | 135.4   |         |  | $      | 430.0  |    |  | $      | (69.7   | )  |  | $      | 774.2  |    |
| Operatingcosts andexpenses:                  |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |   |    |  |   |    |    |  |   |   |    |
| Costof productsold                           |  |   | — |    |  |                  | 168.2   |                      |  |         | 85.1    |         |  |   | 217.7  |    |  |   | (69.7   | )  |  |   | 401.3  |    |
| Selling,administrative, and researchexpenses |  |   | — |    |  |                  | 95.7    |                      |  |         | 31.2    |         |  |   | 128.2  |    |  |   | — |    |  |   | 255.1  |    |
| Amortizationof intangibleassets              |  |   | — |    |  |                  | 9.7     |                      |  |         | 3.3     |         |  |   | 10.9   |    |  |   | — |    |  |   | 23.9   |    |
| Totaloperating costs andexpenses             |  |   | — |    |  |                  | 273.6   |                      |  |         | 119.6   |         |  |   | 356.8  |    |  |   | (69.7   | )  |  |   | 680.3  |    |
| **Operatingearnings(loss)**                  |  |   | — |    |  |                  | 4.9     |                      |  |         | 15.8    |         |  |   | 73.2   |    |  |   | — |    |  |   | 93.9   |    |
| Otherincome (expense),net                    |  |   | 14.1    |    |  |                  | 8.9     |                      |  |         | 15.3    |         |  |   | (16.6  | )  |  |   | (22.9   | )  |  |   | (1.2   | )  |
| Interestincome                               |  |   | — |    |  |                  | 1.9     |                      |  |         | 1.3     |         |  |   | 6.4    |    |  |   | (7.3    | )  |  |   | 2.3    |    |
| Interestexpense                              |  |   | — |    |  |                  | (57.1   | )                    |  |         | (2.1    | )       |  |   | (1.8   | )  |  |   | 7.3     |    |  |   | (53.7  | )  |
| Earnings(loss) before incometaxes            |  |   | 14.1    |    |  |                  | (41.4   | )                    |  |         | 30.3    |         |  |   | 61.2   |    |  |   | (22.9   | )  |  |   | 41.3   |    |
| Incometax provision(benefit)                 |  |   | — |    |  |                  | (3.0    | )                    |  |         | 4.2     |         |  |   | 25.8   |    |  |   | 0.2     |    |  |   | 27.2   |    |
| Minorityinterests                            |  |   | (1.7    | )  |  |                  | — |                      |  |         | — |         |  |   | (1.5   | )  |  |   | 1.5     |    |  |   | (1.7   | )  |
| **Netearnings(loss)**                        |  | $      | 12.4    |    |  | $                     | (38.4   | )                    |  | $            | 26.1    |         |  | $      | 33.9   |    |  | $      | (21.6   | )  |  | $      | 12.4   |    |
|                                              |

17

----

Nalco HoldingsLLC and Subsidiaries Condensed Consolidating Statement ofOperations Nine Months ended September 30, 2005(dollarsinmillions)

|                                              |  |        |         |         |  |                       |         |                           |  |              |         |              |  |        |         |         |  |        |         |         |  |        |         |         |  |  |
|----------------------------------------------|--|--------|---------|---------|--|-----------------------|---------|---------------------------|--|--------------|---------|--------------|--|--------|---------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                         |  | Parent |         | Issuer  |  | GuarantorSubsidiaries |         | Non-GuarantorSubsidiaries |  | Eliminations |         | Consolidated |
| **Netsales**                                 |  | $      | — |    |  | $                     | 862.8   |                      |  | $            | 457.9   |         |  | $      | 1,360.1 |    |  | $      | (232.0  | )  |  | $      | 2,448.8 |    |
| Operatingcosts andexpenses:                  |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |    |    |  |   |    |    |  |   |    |    |
| Costof productsold                           |  |   | — |    |  |                  | 561.9   |                      |  |         | 302.9   |         |  |   | 717.1   |    |  |   | (232.0  | )  |  |   | 1,349.9 |    |
| Selling,administrative, and researchexpenses |  |   | — |    |  |                  | 290.6   |                      |  |         | 87.7    |         |  |   | 395.0   |    |  |   | — |    |  |   | 773.3   |    |
| Amortizationof intangibleassets              |  |   | — |    |  |                  | 25.0    |                      |  |         | 8.0     |         |  |   | 28.4    |    |  |   | — |    |  |   | 61.4    |    |
| Businessoptimizationexpenses                 |  |   | — |    |  |                  | 3.9     |                      |  |         | 0.5     |         |  |   | 16.9    |    |  |   | — |    |  |   | 21.3    |    |
| Totaloperating costs andexpenses             |  |   | — |    |  |                  | 881.4   |                      |  |         | 399.1   |         |  |   | 1,157.4 |    |  |   | (232.0  | )  |  |   | 2,205.9 |    |
| **Operatingearnings(loss)**                  |  |   | — |    |  |                  | (18.6   | )                    |  |         | 58.8    |         |  |   | 202.7   |    |  |   | — |    |  |   | 242.9   |    |
| Otherincome (expense),net                    |  |   | 41.6    |    |  |                  | 60.1    |                      |  |         | 20.2    |         |  |   | (58.7   | )  |  |   | (66.0   | )  |  |   | (2.8    | )  |
| Interestincome                               |  |   | — |    |  |                  | 5.1     |                      |  |         | 8.4     |         |  |   | 30.2    |    |  |   | (37.5   | )  |  |   | 6.2     |    |
| Interestexpense                              |  |   | — |    |  |                  | (192.4  | )                    |  |         | (9.9    | )       |  |   | (6.0    | )  |  |   | 37.5    |    |  |   | (170.8  | )  |
| Earnings(loss) before incometaxes            |  |   | 41.6    |    |  |                  | (145.8  | )                    |  |         | 77.5    |         |  |   | 168.2   |    |  |   | (66.0   | )  |  |   | 75.5    |    |
| Incometax provision(benefit)                 |  |   | — |    |  |                  | (28.4   | )                    |  |         | 13.6    |         |  |   | 48.7    |    |  |   | — |    |  |   | 33.9    |    |
| Minorityinterests                            |  |   | (4.4    | )  |  |                  | — |                      |  |         | — |         |  |   | (4.5    | )  |  |   | 4.5     |    |  |   | (4.4    | )  |
| **Netearnings(loss)**                        |  | $      | 37.2    |    |  | $                     | (117.4  | )                    |  | $            | 63.9    |         |  | $      | 115.0   |    |  | $      | (61.5   | )  |  | $      | 37.2    |    |
|                                              |

18

----

Nalco Holdings LLC and SubsidiariesCondensed Consolidating Statement of Operations Nine Months endedSeptember 30, 2004(dollars inmillions)

|                                              |  |        |         |         |  |                       |         |                           |  |              |         |              |  |        |         |         |  |        |         |         |  |        |         |         |  |  |
|----------------------------------------------|--|--------|---------|---------|--|-----------------------|---------|---------------------------|--|--------------|---------|--------------|--|--------|---------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                         |  | Parent |         | Issuer  |  | GuarantorSubsidiaries |         | Non-GuarantorSubsidiaries |  | Eliminations |         | Consolidated |
| **Netsales**                                 |  | $      | — |    |  | $                     | 810.6   |                      |  | $            | 398.3   |         |  | $      | 1,218.0 |    |  | $      | (199.0  | )  |  | $      | 2,227.9 |    |
| Operatingcosts andexpenses:                  |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |    |    |  |   |    |    |  |   |    |    |
| Costof productsold                           |  |   | — |    |  |                  | 479.0   |                      |  |         | 244.6   |         |  |   | 623.3   |    |  |   | (199.0  | )  |  |   | 1,147.9 |    |
| Selling,administrative, and researchexpenses |  |   | — |    |  |                  | 311.7   |                      |  |         | 87.9    |         |  |   | 370.4   |    |  |   | — |    |  |   | 770.0   |    |
| Amortizationof intangibleassets              |  |   | — |    |  |                  | 29.6    |                      |  |         | 9.8     |         |  |   | 33.6    |    |  |   | — |    |  |   | 73.0    |    |
| In-processresearch anddevelopment            |  |   | — |    |  |                  | 108.6   |                      |  |         | 13.7    |         |  |   | — |    |  |   | — |    |  |   | 122.3   |    |
| Totaloperating costs andexpenses             |  |   | — |    |  |                  | 928.9   |                      |  |         | 356.0   |         |  |   | 1,027.3 |    |  |   | (199.0  | )  |  |   | 2,113.2 |    |
| **Operatingearnings(loss)**                  |  |   | — |    |  |                  | (118.3  | )                    |  |         | 42.3    |         |  |   | 190.7   |    |  |   | — |    |  |   | 114.7   |    |
| Otherincome (expense),net                    |  |   | (90.6   | )  |  |                  | 39.9    |                      |  |         | 25.3    |         |  |   | (54.7   | )  |  |   | 73.6    |    |  |   | (6.5    | )  |
| Interestincome                               |  |   | — |    |  |                  | 6.8     |                      |  |         | 3.4     |         |  |   | 7.9     |    |  |   | (10.4   | )  |  |   | 7.7     |    |
| Interestexpense                              |  |   | — |    |  |                  | (163.3  | )                    |  |         | (2.6    | )       |  |   | (4.2    | )  |  |   | 10.4    |    |  |   | (159.7  | )  |
| Earnings(loss) before incometaxes            |  |   | (90.6   | )  |  |                  | (234.9  | )                    |  |         | 68.4    |         |  |   | 139.7   |    |  |   | 73.6    |    |  |   | (43.8   | )  |
| Incometax provision(benefit)                 |  |   | — |    |  |                  | (20.0   | )                    |  |         | 5.7     |         |  |   | 60.9    |    |  |   | 0.2     |    |  |   | 46.8    |    |
| Minorityinterests                            |  |   | (3.6    | )  |  |                  | — |                      |  |         | — |         |  |   | (3.6    | )  |  |   | 3.6     |    |  |   | (3.6    | )  |
| **Netearnings(loss)**                        |  | $      | (94.2   | )  |  | $                     | (214.9  | )                    |  | $            | 62.7    |         |  | $      | 75.2    |    |  | $      | 77.0    |    |  | $      | (94.2   | )  |
|                                              |

19

----

Nalco Holdings LLC and SubsidiariesCondensed Consolidating Statement of Cash Flows Nine Months endedSeptember 30, 2005(dollars inmillions)

|                                                    |  |        |         |         |  |                       |         |                           |  |              |         |              |  |        |         |         |  |        |         |         |  |        |         |         |  |  |
|----------------------------------------------------|--|--------|---------|---------|--|-----------------------|---------|---------------------------|--|--------------|---------|--------------|--|--------|---------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                               |  | Parent |         | Issuer  |  | GuarantorSubsidiaries |         | Non-GuarantorSubsidiaries |  | Eliminations |         | Consolidated |
| **Operatingactivities**                            |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |    |    |  |   |    |    |  |   |    |    |
| Netearnings(loss)                                  |  | $      | 37.2    |    |  | $                     | (117.4  | )                    |  | $            | 63.9    |         |  | $      | 115.0   |    |  | $      | (61.5   | )  |  | $      | 37.2    |    |
| Non-cashadjustments                                |  |   | (37.2   | )  |  |                  | 65.7    |                      |  |         | 42.2    |         |  |   | 81.9    |    |  |   | 39.3    |    |  |   | 191.9   |    |
| Changesin operating assets andliabilities          |  |   | — |    |  |                  | 88.0    |                      |  |         | (85.9   | )       |  |   | (57.2   | )  |  |   | — |    |  |   | (55.1   | )  |
| Netcash provided by (used for) operatingactivities |  |   | — |    |  |                  | 36.3    |                      |  |         | 20.2    |         |  |   | 139.7   |    |  |   | (22.2   | )  |  |   | 174.0   |    |
| **Investingactivities**                            |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |    |    |  |   |    |    |  |   |    |    |
| Acquisitionof Ondeo NalcoGroup                     |  |   | — |    |  |                  | (3.2    | )                    |  |         | — |         |  |   | — |    |  |   | — |    |  |   | (3.2    | )  |
| Additionsto property, plant, and equipment,net     |  |   | — |    |  |                  | (15.6   | )                    |  |         | (6.9    | )       |  |   | (22.8   | )  |  |   | — |    |  |   | (45.3   | )  |
| Otherinvestingactivities                           |  |   | — |    |  |                  | (4.2    | )                    |  |         | (10.3   | )       |  |   | (68.1   | )  |  |   | 81.7    |    |  |   | (0.9    | )  |
| Netcash provided by (used for) investingactivities |  |   | — |    |  |                  | (23.0   | )                    |  |         | (17.2   | )       |  |   | (90.9   | )  |  |   | 81.7    |    |  |   | (49.4   | )  |
| **Financingactivities**                            |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |    |    |  |   |    |    |  |   |    |    |
| Cashdividends                                      |  |   | — |    |  |                  | — |                      |  |         | (2.7    | )       |  |   | (19.5   | )  |  |   | 22.2    |    |  |   | — |    |
| Netborrowings (repayments) ofdebt                  |  |   | — |    |  |                  | (11.6   | )                    |  |         | 1.0     |         |  |   | (15.0   | )  |  |   | (79.4   | )  |  |   | (105.0  | )  |
| Capitalcontributions                               |  |   | — |    |  |                  | — |                      |  |         | — |         |  |   | 2.3     |    |  |   | (2.3    | )  |  |   | — |    |
| Otherfinancingactivities                           |  |   | — |    |  |                  | (1.3    | )                    |  |         | 0.1     |         |  |   | (4.4    | )  |  |   | — |    |  |   | (5.6    | )  |
| Netcash provided by (used for) financingactivities |  |   | — |    |  |                  | (12.9   | )                    |  |         | (1.6    | )       |  |   | (36.6   | )  |  |   | (59.5   | )  |  |   | (110.6  | )  |
| Effectof exchange rate changes oncash              |  |   | — |    |  |                  | — |                      |  |         | — |         |  |   | (0.5    | )  |  |   | — |    |  |   | (0.5    | )  |
| Increase(decrease) incash                          |  |   | — |    |  |                  | 0.4     |                      |  |         | 1.4     |         |  |   | 11.7    |    |  |   | — |    |  |   | 13.5    |    |
| Cashat beginning ofperiod                          |  |   | — |    |  |                  | 1.3     |                      |  |         | 0.8     |         |  |   | 31.1    |    |  |   | — |    |  |   | 33.2    |    |
| Cashat end of period                               |  | $      | — |    |  | $                     | 1.7     |                      |  | $            | 2.2     |         |  | $      | 42.8    |    |  | $      | — |    |  | $      | 46.7    |    |
|                                                    |

20

----

Nalco Holdings LLC and SubsidiariesCondensed Consolidating Statement of Cash Flows Nine Months endedSeptember 30, 2004(dollars inmillions)

|                                                    |  |        |         |         |  |                       |         |                           |  |              |         |              |  |        |         |         |  |        |         |         |  |        |         |         |  |  |
|----------------------------------------------------|--|--------|---------|---------|--|-----------------------|---------|---------------------------|--|--------------|---------|--------------|--|--------|---------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                               |  | Parent |         | Issuer  |  | GuarantorSubsidiaries |         | Non-GuarantorSubsidiaries |  | Eliminations |         | Consolidated |
| **Operatingactivities**                            |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |    |    |  |   |    |    |  |   |    |    |
| Netearnings(loss)                                  |  | $      | (94.2   | )  |  | $                     | (214.9  | )                    |  | $            | 62.7    |         |  | $      | 75.2    |    |  | $      | 77.0    |    |  | $      | (94.2   | )  |
| Noncashadjustments                                 |  |   | 94.6    |    |  |                  | 195.7   |                      |  |         | 45.8    |         |  |   | 60.0    |    |  |   | (90.6   | )  |  |   | 305.5   |    |
| Changesin operating assets andliabilities          |  |   | (4.1    | )  |  |                  | 99.6    |                      |  |         | 8.7     |         |  |   | (59.3   | )  |  |   | — |    |  |   | 44.9    |    |
| Netcash provided by (used for) operatingactivities |  |   | (3.7    | )  |  |                  | 80.4    |                      |  |         | 117.2   |         |  |   | 75.9    |    |  |   | (13.6   | )  |  |   | 256.2   |    |
| **Investingactivities**                            |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |    |    |  |   |    |    |  |   |    |    |
| Acquisitionof Ondeo NalcoGroup                     |  |   | (0.3    | )  |  |                  | 25.6    |                      |  |         | — |         |  |   | — |    |  |   | — |    |  |   | 25.3    |    |
| Additionsto property, plant, and equipment,net     |  |   | — |    |  |                  | (12.9   | )                    |  |         | (3.9    | )       |  |   | (40.9   | )  |  |   | — |    |  |   | (57.7   | )  |
| Businesspurchases/sales,net                        |  |   | (11.0   | )  |  |                  | (3.0    | )                    |  |         | (0.3    | )       |  |   | (0.1    | )  |  |   | 14.4    |    |  |   | — |    |
| Otherinvestingactivities                           |  |   | — |    |  |                  | 114.7   |                      |  |         | (23.4   | )       |  |   | (53.0   | )  |  |   | (43.4   | )  |  |   | (5.1    | )  |
| Netcash provided by (used for) investingactivities |  |   | (11.3   | )  |  |                  | 124.4   |                      |  |         | (27.6   | )       |  |   | (94.0   | )  |  |   | (29.0   | )  |  |   | (37.5   | )  |
| **Financingactivities**                            |  |   |    |    |  |                  |    |                      |  |         |    |         |  |   |    |    |  |   |    |    |  |   |    |    |
| Cashdividends                                      |  |   | — |    |  |                  | — |                      |  |         | (4.2    | )       |  |   | (9.4    | )  |  |   | 13.6    |    |  |   | — |    |
| Netborrowings (repayments) ofdebt                  |  |   | — |    |  |                  | (232.3  | )                    |  |         | (87.1   | )       |  |   | 12.3    |    |  |   | 43.4    |    |  |   | (263.7  | )  |
| Capitalcontributions                               |  |   | 11.0    |    |  |                  | 11.0    |                      |  |         | 0.5     |         |  |   | 2.9     |    |  |   | (14.4   | )  |  |   | 11.0    |    |
| Otherfinancingactivities                           |  |   | — |    |  |                  | — |                      |  |         | — |         |  |   | (0.7    | )  |  |   | — |    |  |   | (0.7    | )  |
| Netcash provided by (used for) financingactivities |  |   | 11.0    |    |  |                  | (221.3  | )                    |  |         | (90.8   | )       |  |   | 5.1     |    |  |   | 42.6    |    |  |   | (253.4  | )  |
| Effectof exchange rate changes oncash              |  |   | — |    |  |                  | — |                      |  |         | — |         |  |   | (2.2    | )  |  |   | — |    |  |   | (2.2    | )  |
| Increase(decrease) incash                          |  |   | (4.0    | )  |  |                  | (16.5   | )                    |  |         | (1.2    | )       |  |   | (15.2   | )  |  |   | — |    |  |   | (36.9   | )  |
| Cashat beginning ofperiod                          |  |   | 4.0     |    |  |                  | 22.5    |                      |  |         | 1.8     |         |  |   | 71.7    |    |  |   | — |    |  |   | 100.0   |    |
| Cashat end of period                               |  | $      | — |    |  | $                     | 6.0     |                      |  | $            | 0.6     |         |  | $      | 56.5    |    |  | $      | — |    |  | $      | 63.1    |    |
|                                                    |

21

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|              |                                                                                     |
|--------------|-------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations |

On November 4, 2003,Nalco Holdings LLC, a company formed by The Blackstone Group, ApolloManagement, L.P. and GS Capital Partners (the"Sponsors"), purchased all of the outstandingshares of capital stock of Ondeo Nalco Company (which is now known asNalco Company) and the Nalco International SAS Subsidiaries, which hadbeen operated as a single business unit, from subsidiaries of Suez S.A.(Suez). In the following discussion and analysis, we refer to thisacquisition as the "Acquisition," and theterm "Transactions" means, collectively, theAcquisition and the related financings to fund the Acquisition.

The statements in the discussion and analysis regardingindustry outlook, our expectations regarding the performance of ourbusiness and the other non-historical statements in the discussion andanalysis are forward-looking statements. These forward-lookingstatements are subject to numerous risks and uncertainties. Our actualresults may differ materially from those contained in or implied by anyforward-looking statements. You should read the following discussiontogether with the consolidated financial statements of Nalco HoldingsLLC included elsewhere in this report.

"SafeHarbor" Statement Under Private Securities LitigationReform Act of 1995

This Quarterly Report for the fiscal quarterended September 30, 2005 (the "QuarterlyReport") includes "forward-lookingstatements" within the meaning of Section 27A of theSecurities Act of 1933 and Section 21E of the Securities Exchange Actof 1934. These forward-looking statements include statements concerningour plans, objectives, goals, strategies, future events, future revenueor performance, capital expenditures, financing needs, plans orintentions relating to acquisitions, business trends and otherinformation that is not historical information. When used in thisQuarterly Report, the words "estimates,""expects,""anticipates,""projects,""plans," "intends,""believes,""forecasts," or future or conditional verbs,such as "will,""should," "could"or "may," and variations of such words orsimilar expressions are intended to identify forward-lookingstatements. All forward-looking statements, including, withoutlimitation, management's examination of historical operatingtrends and data are based upon our current expectations and variousassumptions. Our expectations, beliefs and projections are expressed ingood faith and we believe there is a reasonable basis for them.However, there can be no assurance that management'sexpectations, beliefs and projections will be achieved.

Thereare a number of risks and uncertainties that could cause our actualresults to differ materially from the forward-looking statementscontained in this Quarterly Report. Additionally, important factorscould cause our actual results to differ materially from theforward-looking statements we make in this Quarterly Report. As statedelsewhere in this Quarterly Report, such risks, uncertainties and otherimportant factors include, among others:

|              |                          |
|--------------|--------------------------|
| •  | our substantialleverage; |

|              |                                                                                      |
|--------------|--------------------------------------------------------------------------------------|
| •  | limitations onflexibility in operating our business contained in our debtagreements; |

|              |                                                                          |
|--------------|--------------------------------------------------------------------------|
| •  | increases ininterest rates as a result of our variable rateindebtedness; |

|              |                                     |
|--------------|-------------------------------------|
| •  | pricing pressurefrom our customers; |

|              |                                                                                                                                                                                                      |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | changesto, or elimination of, legal or regulatory requirements imposed uponour customers which could adversely affect portions of our business,such as that which serves the synthetic-fuelindustry; |

|              |                                     |
|--------------|-------------------------------------|
| •  | technological changeand innovation; |

|              |                                              |
|--------------|----------------------------------------------|
| •  | risksassociated with our non-U.S.operations; |

|              |                                         |
|--------------|-----------------------------------------|
| •  | fluctuations incurrency exchange rates; |

|              |                                                    |
|--------------|----------------------------------------------------|
| •  | highcompetition in the markets in which weoperate; |

|              |                                                                |
|--------------|----------------------------------------------------------------|
| •  | adverse changes toenvironmental, health and safetyregulations; |

|              |                                                |
|--------------|------------------------------------------------|
| •  | operating hazardsin our production facilities; |

22

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

|              |                                           |
|--------------|-------------------------------------------|
| •  | inabilityto achieve expected costsavings; |

|              |                                                  |
|--------------|--------------------------------------------------|
| •  | difficulties insecuring the raw materials weuse; |

|              |                                                                                              |
|--------------|----------------------------------------------------------------------------------------------|
| •  | our significant pensionbenefit obligations and the current underfunding in our pensionplans; |

|              |                                                               |
|--------------|---------------------------------------------------------------|
| •  | our ability to realizethe full value of our intangibleassets; |

|              |                                                                                                                                  |
|--------------|----------------------------------------------------------------------------------------------------------------------------------|
| •  | our ability to attractand retain skilled employees, particularly research scientists,technical sales professionals andengineers; |

|              |                                                            |
|--------------|------------------------------------------------------------|
| •  | our ability toprotect our intellectual property rights;and |

|              |                                                                             |
|--------------|-----------------------------------------------------------------------------|
| •  | the possibility that ourowners' interests will conflict with ours or yours. |

Theremay be other factors that may cause our actual results to differmaterially from the forward-looking statements.

Allforward-looking statements attributable to us or persons acting on ourbehalf apply only as of the date of this Quarterly Report and areexpressly qualified in their entirety by the cautionary statementsincluded in this Quarterly Report. We undertake no obligation to updateor revise forward-looking statements which may be made to reflectevents or circumstances that arise after the date made or to reflectthe occurrence of unanticipated events.

Executive LevelOverview

Our sales grew 7.8% for the three months endedSeptember 30, 2005 to $834.9 million, including 6.4% in organicimprovement that excludes foreign currency and divestiture impacts. Ofthis organic improvement, price represents 5.4%, orapproximately $42 million. We have consistently reminded our salesforce that our goal this year is to ensure that we capture pricing, andnot just incremental service and product volume, to offset higher costswe continue to experience. Changes in foreign currency translationrates added 1.5% to sales growth in the third quarter, whiledivestitures reduced sales by 0.1%.

Energy Servicessegment sales jumped 11.1% in the third quarter, including9.5% organic improvement. Customer operation shutdowns in theGulf of Mexico prior to and following the hurricanes limited growth inour oil field service business – including a HurricaneDennis-initiated delay of the operational start of a large new platformwe had expected to begin serving in the fourth quarter. However, wegrew at double-digit paces in our exploration service, refinery andpetrochemical units.

Industrial and Institutional Services salesincreased 8.0% in the third quarter, of which 6.5% wasorganic. Strong organic sales growth in North America, Latin Americaand the Pacific region contributed to this improvement. Areas ofweakness included the U.S. chemical sector, again impacteddisproportionately by the hurricanes, and our water treatmentoperations in Europe. In North America, water treatment sales wereparticularly strong in our Power and Institutional segments. Several ofthe global process application groups in the segment recordeddouble-digit organic growth rates.

Paper Services segment salesincreased 5.8%, of which 4.3% was organic. Strong growthin Asia, and particularly in China, led this expansion. Organic salesto Paper customers in North America and Latin America also grew atmid-single-digit rates, offsetting a sales decline in Europe. Therevenue decline in Europe was primarily caused by continued slowproduction following the conclusion of the Finnish labor strike and bythe closure of a large customer.

Organic and nominal sales grewfaster in the three months ended September 30, 2005 than for the firstnine months of 2005 for the Energy Services and Industrial andInstitutional Services segments, but slower in the Paper segment.

23

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

Third quarter sales in the Other segmentwere flat, despite double-digit growth in India and good growth in analternate channels business. Year-to-date, sales in the Other segmentare up 15.2% organically, but 49.2% overall. Nominalsales growth was higher than organic sales growth primarily as a resultof the creation of the Katayama Nalco joint venture in Japan, which wasinitiated June 1, 2004.

Through the first nine months of 2005,total Company revenues grew 9.9% on a nominal basis, with6.6% of the sales growth coming from organic sales improvement.Price contributed 4.3% of the 6.6% improvement. Duringthe first nine months, price increases added approximately $95 millionto sales, while costs for raw and purchased materials and freightincreased by about $123 million.

Net earnings rose to $23.2million in the three months ended September 30, 2005 from $12.4 millionin the three months ended September 30, 2004. Lower income tax expensedrove much of the improvement. Pre-tax earnings were reduced by anestimated $6 million as a result of hurricane-related cost increasesand lost sales incurred during the quarter. No potential insurancerecoveries related to the hurricanes are factored into our results.

Net earnings for the year-to-date improved to $37.2 million from ayear-ago loss of $94.2 million. The year-ago loss included a $122.3million, non-cash purchase accounting-related expense for In ProcessResearch and Development.

Gross margin levels improved from42.6% in the second quarter to 45.2% in the third quarterin part on the strength of price improvement. For the first time thisyear, quarterly price increases of about $42 million exceeded higherraw material, purchased material and freight costs in the quarter ofapproximately $40 million. Versus the year-ago quarter, however, grossmargins were 300 basis points lower. About 220 points of the margindeterioration was caused by price increases only being modestly aboveyear-on-year cost increases for the quarter.

In addition toincreases in cost pressures, raw material availability constraints arealso creating operational inefficiencies. Currently, raw materials thatface supply constraints include: caustic soda, some ethylene-basedmaterials and some solvents and alcohols.

Weakness in Europealso impacted the Company's third quarter results and itsnear-term performance expectations.

Total debt was reduced by$117.4 million and cash increased by $7.3 million during the threemonths ended September 30, 2005. We repaid $88 million on Term Loan Aand $24 million in revolver debt that was outstanding at June 30. Cashgenerated by operating activities during the period was elevated by thebenefits of our second quarter inventory reduction program.

During October, we received approval from our creditors to simplifyour organizational structure overseas to more closely match thereporting structures of our organization. These changes will alsofacilitate movement of working capital and may improve our cashmovement by reducing withholding tax levels on dividends we repatriateto service debt.

During the three months ended September 30,2005, we substantially completed a review of the accumulated deferredtax balances and determined that certain deferred tax liabilities wereoverstated. These liabilities primarily relate to deferred taxes onintangible assets that should have been reversed as part of purchaseaccounting. Therefore, deferred tax liabilities and goodwill were eachadjusted downward by $70 million.

Our estimated effective taxrate for 2005 is now 44.9%, and we have made the necessaryadjustment in the third quarter to put the year-to-date income taxprovision at this level. This rate is higher than our prior projectionof 43.4%. The tax cost of repatriating certain foreign earningsis relatively unchanged, and is the primary reason our income taxprovision does not decrease proportionately with decreases in projectedpre-tax earnings.

24

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

Outlook

Gulf of Mexico oiland gas production, and on-shore refining and petrochemical operationsare taking longer to re-start than originally expected. We project thattotal lost sales as a result of these closures will now totalapproximately $12 million in the fourth quarter. Hurricanes Katrina,Rita and Dennis all were responsible for portions of the expected saleslosses. Some rig closures in the Gulf of Mexico now look like they willextend into 2006. We also expect pre-tax earnings to be reduced by$26  million, bringing the total estimated 2005 hurricane pre-taxearnings impact to $32 million.

On a global basis, we have seenthis year the largest push-through of raw material costs in at least 30years, combined with hurricanes that have had the largest impact onNalco of any natural events as far as we can find in the 77-yearhistory of the Company. Growth in the face of this year'schallenges shows the strength of our business model.

As werestore margins through continued pricing moves and program upgradesand substitutions, we are also refocusing our sales engineers onselling efforts to restore volume growth rates. Our water and processprograms by design frequently play an important role in reducingcustomer energy consumption, and this environment of extraordinarilyhigh energy costs is conducive to promoting our fundamental valueproposition.

For example, our 3D TRASAR® coolingwater stress management system provides a much higher level ofcontaminant control in cooling towers, significantly reducing energyrequirements in cooling tower operations versus competitive offerings.A new SMART SolutionsTM for Efficiency offering we recentlyintroduced to Paper Services customers provides up to 10% to15% energy savings on each ton of paper produced, in addition toother efficiency benefits. Scale and fouling control programs inboilers, refinery processes and other customer operations also reduceenergy consumption, while cutting maintenance costs, extending the lifeof assets, and providing other customer benefits.

Results ofOperations

Quarter Ended September 30, 2005 Compared tothe Quarter Ended September 30, 2004

Net sales for the threemonths ended September 30, 2005 and September 30, 2004 may be comparedasfollows:

|                                       |  |                    |       |                   |  |          |       |                                               |  |                           |      |         |  |        |     |         |  |        |         |          |  |        |     |         |  |  |
|---------------------------------------|--|--------------------|-------|-------------------|--|----------|-------|-----------------------------------------------|--|---------------------------|------|---------|--|--------|-----|---------|--|--------|---------|----------|--|--------|-----|---------|--|--|
|                                  |
|                                  |  |               |       |              |  |     |       | Attributableto Changesin the FollowingFactors |
|                                  |  | Three Monthsended  |       |              |  |     |       |                                          |  |
| (dollarsin millions)                  |  | September 30, 2005 |       | September 30,2004 |  | % Change |       | CurrencyTranslation                           |  | Acquisitions/Divestitures |      | Organic |
| Industrial& InstitutionalServices |  | $                  | 382.4 |              |  | $        | 354.0 |                                          |  |                      | 8.0  | %  |  |   | 1.5 | %  |  |   | — | %   |  |   | 6.5 | %  |
| EnergyServices                        |  |               | 222.7 |              |  |     | 200.4 |                                          |  |                      | 11.1 | %  |  |   | 1.6 | %  |  |   | — | %   |  |   | 9.5 | %  |
| PaperServices                         |  |               | 174.2 |              |  |     | 164.6 |                                          |  |                      | 5.8  | %  |  |   | 1.5 | %  |  |   | — | %   |  |   | 4.3 | %  |
| Other                                 |  |               | 55.6  |              |  |     | 55.2  |                                          |  |                      | 0.9  | %  |  |   | 1.5 | %  |  |   | (1.6    | %)  |  |   | 1.0 | %  |
| Netsales                              |  | $                  | 834.9 |              |  | $        | 774.2 |                                          |  |                      | 7.8  | %  |  |   | 1.5 | %  |  |   | (0.1    | %)  |  |   | 6.4 | %  |
|                                       |

Netsales for the three months ended September 30, 2005 were $834.9million, a 7.8% increase from the $774.2 million reported forthe three months ended September 30, 2004. On an organic basis, whichexcludes the impacts of changes in foreign currency translation ratesand acquisitions and divestitures, net sales were up 6.4%. Ofthis improvement, 5.4% was attributed to price increases. Theremaining 1.0% was driven by sales growth, which was reduced byan estimated 0.5% due to hurricane-related sales losses. TheEnergy Services division posted strong organic growth in sales of9.5%, with slightly more than half of this improvement theresult of price increases. The Energy Services division was the mostaffected by the Gulf hurricanes, and organic growth would have been anestimated 1.6% higher if sales had not been lost due to thehurricanes. The Industrial and 

25

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

Institutional Services division reportedorganic growth of 6.5%. While this improvement was mostlyattributable to price increases, solid growth was posted by our watertreatment business in the Latin American and Pacific regions andcertain of our North American water treatment and global processservice units. Lower water treatment sales in Europe offset a portionof these gains. Organically, Paper Services division sales were up4.3% compared to a year ago, as continued strong growth in thePacific region and a more modest gain in North America more than offseta sales decline in Europe caused by continued slow production followingthe conclusion of the Finnish labor strike and the closure of a largecustomer in the U.K. Price increases also contributed to organic growthin Paper Services sales in North America and Latin America. The organicincrease in "other" sales was attributable toimproved alternative channel sales and our subsidiary company in India,partly offset by the effects of a variation in revenue recognitionadjustments and a decision made in late 2003 to reduce certainlow-margin business with a major customer.

Grossprofit**,**defined as the difference between net sales andcost of product sold, of $377.3 million for the three months endedSeptember 30, 2005 increased by $4.4 million, or 1.2%, from the$372.9  million reported for the quarter ended September 30,2004. On an organic basis, gross profit decreased by $0.5 million, withunfavorable manufacturing volume variances accounting for this change.The gross profit margin was 45.2% for the three months endedSeptember 30, 2005 compared to 48.2% for the year-ago period, asincreases in the selling prices of our products were largely offset byhigher costs of raw and other purchased materials.

Selling,administrative, and research expenses for the three months endedSeptember 30, 2005 of $251.5  million decreased by $3.6 million,or 1.4%, from $255.1 million for the three months endedSeptember 30, 2004. On an organic basis, selling, administrative, andresearch expenses decreased by $6.5 million, or 2.5%, reflectingfurther initiatives to reduce and control spending. This decrease waspartly offset by the effect of changes in foreign currency translationrates.

Amortization of intangible assets was $20.3million and $23.9 million for the three months ended September 30, 2005and 2004, respectively. The decrease was attributable to loweramortization of customer relationships, which are amortized using anaccelerated method.

Business optimization expenses,representing mostly employee severance and related costs, were$3.5  million for the three months ended September 30, 2005.

Other income (expense), net was nil for the three monthsended September 30, 2005 and a net expense of $1.2 million for thethree months ended September 30, 2004. In November 2004, the Companyterminated the monitoring services provided to the Company byaffiliates of the Sponsors. Monitoring fees for such services were $2.7million for the three months ended September 30, 2004. Alsocontributing to the variance from the year-ago quarter were higherforeign currency transaction gains of $1.7 million. Partly offsettingthese favorable variations were losses from asset disposals of$2.6  million and a $0.8 million decrease in equity in earningsof unconsolidated subsidiaries.

Net interest expense,defined as the combination of interest income and interest expense, of$56.2  million for the three months ended September 30, 2005increased by $4.8 million from the $51.4  million reported forthe three months ended September 30, 2004. The impact of higherinterest rates on variable rate borrowings more than offset the impactof a lower average debt level compared to the year-ago period.

The effective tax rate for the three months ended September30, 2005 was 45.9%. The rate varies from the U.S. statutoryincome tax rate of 35% primarily due to the incremental tax ondividends received from non-U.S. subsidiaries, foreign taxes providedat less than the 35% U.S. statutory rate, U.S. state incometaxes, nondeductible expenses, and other permanent differences.

The aforementioned items also contributed to the variation betweenthe U.S. statutory income tax rate and the Company's effectiveincome tax rate for the three months ended September 30, 2004.

26

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

The American Jobs Creation Act of 2004(the "Jobs Creation Act") created a one-timeincentive for American companies to repatriate earnings from theirforeign subsidiaries. We have completed a comparison of the benefitsavailable under the Jobs Creation Act to those under other strategiesfor global cash and debt management, and we have compared the benefitsof implementing the incentive to the costs required to implement it.Based upon this analysis, we have decided not to structure our earningsrepatriation under the provisions of the Jobs Creation Act.

Minority interest expense of $1.6 million for the threemonths ended September 30, 2005 was slightly lower than the $1.7million for the year-ago quarter.

Nine months EndedSeptember 30, 2005 Compared to the Nine Months Ended September 30,2004

Net sales for the nine months ended September 30, 2005and September 30, 2004 may be compared asfollows:

|                                       |  |                    |         |                   |  |          |         |                                               |  |                           |      |         |  |        |     |         |  |        |      |          |  |        |      |         |  |  |
|---------------------------------------|--|--------------------|---------|-------------------|--|----------|---------|-----------------------------------------------|--|---------------------------|------|---------|--|--------|-----|---------|--|--------|------|----------|--|--------|------|---------|--|--|
|                                  |
|                                  |  |               |         |              |  |     |         | Attributableto Changesin the FollowingFactors |
|                                  |  | Nine Monthsended   |         |              |  |     |         |                                          |  |
| (dollarsin millions)                  |  | September 30, 2005 |         | September 30,2004 |  | % Change |         | CurrencyTranslation                           |  | Acquisitions/Divestitures |      | Organic |
| Industrial& InstitutionalServices |  | $                  | 1,106.6 |              |  | $        | 1,032.4 |                                          |  |                      | 7.2  | %  |  |   | 2.2 | %  |  |   | (0.2 | )%  |  |   | 5.2  | %  |
| EnergyServices                        |  |               | 653.4   |              |  |     | 593.0   |                                          |  |                      | 10.2 | %  |  |   | 2.1 | %  |  |   | (0.9 | )%  |  |   | 9.0  | %  |
| PaperServices                         |  |               | 520.8   |              |  |     | 489.9   |                                          |  |                      | 6.3  | %  |  |   | 2.4 | %  |  |   | (0.7 | )%  |  |   | 4.6  | %  |
| Other                                 |  |               | 168.0   |              |  |     | 112.6   |                                          |  |                      | 49.2 | %  |  |   | 3.0 | %  |  |   | 31.0 | %   |  |   | 15.2 | %  |
| Netsales                              |  | $                  | 2,448.8 |              |  | $        | 2,227.9 |                                          |  |                      | 9.9  | %  |  |   | 2.2 | %  |  |   | 1.1  | %   |  |   | 6.6  | %  |
|                                       |

Netsales for the nine months ended September 30, 2005 were $2,448.8million, a 9.9% increase from the $2,227.9 million reported forthe nine months ended September 30, 2004. On an organic basis, whichexcludes the impacts of changes in foreign currency translation ratesand acquisitions and divestitures, net sales were up 6.6%. Ofthis improvement, 4.3% was attributed to price increases, whilethe remaining 2.3% was driven by favorable sales growth broadlyspread across our customer base. The Energy Services division reporteda strong organic improvement in sales of 9.0%, more than half ofwhich represented growth. The Industrial and Institutional Servicesdivision reported organic growth of 5.2%, which was mostlyattributable to price increases. However, solid gains, exclusive ofprice increases, were posted by our water treatment business in theLatin American and Pacific regions, as well as our Pacific regionmining business. These gains were offset by sales declines, exclusiveof price increases, in North America and, more notably, Europe.Difficulties in adapting work processes following our SAP systemconversion in Europe on January 1, 2005 and the generally slowereconomy in our largest western European markets were among the causesof the sales decline in Europe. Higher sales during the three monthsended December 31, 2004 was another contributing factor, as Europeancustomers purchased in advance to avoid risking any potentialcomplications from the system conversion. Solid growth in the LatinAmerica and Pacific regions and a more modest improvement in NorthAmerica contributed to the 4.6% organic growth in Paper Servicesdivision sales. These improvements were partly offset by lower PaperServices sales in Europe, resulting from labor strikes faced by ourFinnish customers and the aforementioned factors that affectedIndustrial and Institutional Services sales in the region. Most of theorganic improvement in "other" sales wasattributable to alternate channel sales, our subsidiary company inIndia, and our Japanese joint venture, Katayama Nalco. The increase in"other" sales attributable toacquisitions/divestitures represents the incremental impact of salesfor the first five months of 2005 by Katayama Nalco, which was formedwith Katayama Chemical Inc. on June 1, 2004.

Grossprofit**,**defined as the difference between net sales andcost of product sold, of $1,098.9 million for the nine months endedSeptember 30, 2005 increased by $18.9 million, or 1.8%, over the$1,080.0  million reported for the nine months ended September30, 2004. On an organic basis and excluding the impact of a $14.5million charge to cost of product sold during the nine months ended

27

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

September 30, 2004 resulting from the sale ofinventory that had been revalued at selling price less costs to sell inpurchase accounting at the date of the Acquisition, gross profitdecreased by $29.3  million. This was primarily attributable tohigher costs of raw and other purchased materials, partly offset by theimpact of increases in the selling prices of our products. Gross profitmargin for the nine months ended September 30, 2005 was 44.9%compared to 48.5% for the year-ago period. Gross profit marginfor the nine months ended September 30, 2004 was reduced approximately65 basis points as a result of the aforementioned $14.5 million chargeresulting from purchase accounting.

Selling, administrative,and research expenses for the nine months ended September 30, 2005of $773.3  million increased by $3.3 million, or 0.4%, from$770.0 million for the nine months ended September 30, 2004. On anorganic basis, selling, administrative, and research expenses decreasedby $20.4 million, or 2.6%, reflecting continuing efforts toreduce and control spending. This decrease was more than offset by theeffect of changes in foreign currency translation rates and theincremental impact of expenses of Katayama Nalco for the first fivemonths of 2005.

Amortization of intangible assets was$61.4 million and $73.0 million for the nine months ended September 30,2005 and 2004, respectively. The decrease was attributable to loweramortization of customer relationships, which are amortized using anaccelerated method.

In-process research and developmentwas a one-time charge of $122.3 million recorded during the nine monthsended September 30, 2004, as a result of purchase accounting related tothe Acquisition. The value of purchased IPR&D was comprised of fiveongoing development projects at the date of the Acquisition. PurchasedIPR&D was derived by assigning values to those projects identifiedby management as having economic value, but that had not yet reachedtechnological feasibility and had no alternative future use.

Business optimization expenses, representing mostlyemployee severance and related costs, were $21.3  million for thenine months ended September 30, 2005, and included a $14.2 millioncharge recorded in June to support a plan to de-layer our managementstructure and reduce costs in lower-performing business units. The plancalls for the elimination of approximately 220 positions, primarily inEurope and North America.

Other income (expense), netwas a net expense of $2.8 million and $6.5 million for the nine monthsended September 30, 2005 and 2004, respectively. In November 2004, theCompany terminated the monitoring services provided to the Company byaffiliates of the Sponsors. Monitoring fees for such services were $8.4million for the nine months ended September 30, 2004. Also contributingto the decrease in net other expense was a favorable change in foreigncurrency transaction gains and losses of $4.3 million. A $2.4 millionimpairment charge in 2005 related to a business held for sale, anincrease in losses from asset write-offs and disposals of $5.9 million,and a $1.3 decrease in equity in earnings of unconsolidatedsubsidiaries partly offset these favorable variations.

Netinterest expense, defined as the combination of interest incomeand interest expense, of $164.6  million for the nine months endedSeptember 30, 2005 increased by $12.6 million from the $152.0million reported for the nine months ended September 30, 2004. Theimpact of higher interest rates on variable rate borrowings more thanoffset the impact of a lower average debt level compared to theyear-ago period.

The effective tax rate for the ninemonths ended September 30, 2005 was 44.9%. The rate varies fromthe U.S. statutory income tax rate of 35% primarily due to theincremental tax on dividends received from non-U.S. subsidiaries,foreign taxes provided at less than the 35% U.S. statutory rate,U.S. state income taxes, nondeductible expenses, and other permanentdifferences.

The aforementioned items also contributed to thevariation between the U.S. statutory income tax rate and theCompany's effective income tax rate for the nine months endedSeptember 30, 2004. In addition, the effective rate was impacted by thecharge for purchased IPR&D, which is not tax deductible.

28

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

Minority interest expense was$0.8 million higher than the $3.6 million for the nine months endedSeptember 30, 2004, reflecting improved results for most of theCompany's non-wholly owned subsidiaries.

Liquidity andCapital Resources

Operatingactivities.    Historically, the Company's main source ofliquidity has been its solid cash flow generated by operatingactivities. For the nine months ended September 30, 2005, cash providedby operating activities was $174.0 million, a decrease of $82.2 millionfrom the same period last year. This decrease was mostly attributableto higher working capital requirements, most notably for accountspayable. Also contributing was the payment of year-end incentive planand commission accruals.

Investingactivities.    Cash used for investing activities was $49.4million for the nine months ended September 30, 2005, which was mostlyattributable to net property additions of $45.3 million.

Cashused for investing activities was $37.5 million for the nine monthsended September 30, 2004. This was mostly the result of net propertyadditions of $57.7 million, partly offset by $25.3 million of netpurchase price adjustments received from Suez related to theAcquisition. Approximately 40% of the capital spending wasattributable to our SAP information systems project in Europe.

Financing activities.    Net cash used for financingactivities totaled $110.6 million during the nine months endedSeptember 30, 2005, which was mostly attributable to a net decrease inborrowings.

Net cash used for financing activities totaled$253.4 million during the nine months ended September 30, 2004. Thiswas primarily comprised of repayment of term loan borrowings.

Since the Transactions, we have been highly leveraged. Our liquidityrequirements are significant, primarily due to debt servicerequirements as well as research and development and capitalinvestment. Our primary source of liquidity will continue to be cashflow generated from operations, but we also have availability under a$250 million revolving credit facility and a $100 million receivablesfacility, in each case subject to certain conditions. We believe thatour financial position and financing structure will provide flexibilityin worldwide financing activities and permit us to respond to changingconditions in credit markets.

Senior creditfacilities.    On November 4, 2003, we entered into senior creditfacilities which provided for a revolving credit facility, a $300million six-year term loan A facility (which includes an€88.0  million tranche) which matures in November2009 and a $1,300 million seven-year term loan B facility which maturesin November 2010. Borrowings under the senior credit facilities bearinterest at a floating base rate plus an applicable margin. Theapplicable margin for borrowings under the revolving credit facilityand the term loan A facility is 1.50% with respect to base rateborrowings and 2.50% with respect to LIBOR or Eurocurrencyborrowings and may be reduced subject to our attaining certain leverageratios. The applicable margin for borrowings under the term loan Bfacility is 1.50% with respect to base rate borrowings and2.00% with respect to LIBOR or Eurocurrency borrowings. Theapplicable margin for borrowings under the term loan B facility is notsubject to adjustment.

In addition to paying interest onoutstanding principal under the senior credit facilities, we arerequired to pay a commitment fee to the lenders under the revolvingcredit facility in respect of the unutilized commitments at a rateequal to 0.50%. We also pay customary letter of credit fees.

The term loan A facility will amortize each year in quarterlyamounts at a rate of 5% per annum in year one, 10% perannum in year two, 15% per annum in year three, 20% perannum in year four and 25% per annum in each of years five andsix.

The term loan B facility will amortize each year in anamount equal to 1% per annum in equal quarterly installments forthe first six years and nine months, with the remaining amount payableon November 4, 2010.

29

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

At September 30, 2005, the outstandingbalance of the term loan A and term loan B facilities was $120.2million and $1,081.0 million, respectively.

Principal amountsoutstanding under the revolving credit facility will be due and payablein full at maturity on November 4, 2009. At September 30, 2005, noborrowings were outstanding under the revolving credit facility.

The senior credit facilities contain a number of covenants that,among other things, restrict, subject to certain exceptions, ourability and the ability of our subsidiaries (including Nalco Company)to sell assets, incur additional indebtedness or issue preferred stock,repay other indebtedness, pay dividends and distributions or repurchasecertain capital stock, create liens on assets, make investments, loansor advances, make certain acquisitions, engage in mergers orconsolidations, enter into sale and leaseback transactions, engage incertain transactions with affiliates, amend certain material agreementsgoverning our indebtedness, change the business conducted by us and oursubsidiaries (including Nalco Company) and enter into hedgingagreements. In addition, the senior credit facilities require NalcoCompany to maintain the following significant financial covenants: amaximum total leverage ratio, a minimum interest coverage ratio and amaximum capital expenditures limitation. We were in compliance with allcovenants at September 30, 2005.

Senior notes and seniorsubordinated notes.    As part of the Transactions in November2003, Nalco Company issued $665 million aggregate principal amount of73⁄4% U.S. dollar-denominated senior notes due 2011,€200 million aggregate principal amount of73⁄4% euro-denominated senior notes due 2011, $465 millionaggregate principal amount of 8 7/8% U.S.dollar-denominated senior subordinated notes due 2013 and€200 million aggregate principal amount of 9%euro-denominated senior subordinated notes due 2013.

Theindentures governing the senior notes and the senior subordinated noteslimit our ability and the ability of our restricted subsidiariesto:

|              |                               |
|--------------|-------------------------------|
| •  | incur additionalindebtedness; |

|              |                                                                                  |
|--------------|----------------------------------------------------------------------------------|
| •  | pay dividendson or make other distributions or repurchase certain capital stock; |

|              |                           |
|--------------|---------------------------|
| •  | make certain investments; |

|              |                                                          |
|--------------|----------------------------------------------------------|
| •  | enter into certain types oftransactions with affiliates; |

|              |                                                                  |
|--------------|------------------------------------------------------------------|
| •  | limit dividends or other paymentsby our restricted subsidiaries; |

|              |                                                  |
|--------------|--------------------------------------------------|
| •  | use assets as security in othertransactions; and |

|              |                                                           |
|--------------|-----------------------------------------------------------|
| •  | sellcertain assets or merge with or into other companies. |

Subject tocertain exceptions, the indentures governing the senior notes and thesenior subordinated notes permit the Company and our restrictedsubsidiaries to incur additional indebtedness, including securedindebtedness.

Covenant compliance.    The breach ofcovenants in our senior credit agreement that are tied to ratios basedon Adjusted EBITDA could result in a default under that agreement andthe lenders could elect to declare all amounts borrowed due andpayable. Any such acceleration would also result in a default under ourindentures. Additionally, under our debt agreements, our ability toengage in activities such as incurring additional indebtedness, makinginvestments and paying dividends is also tied to ratios based onAdjusted EBITDA.

Adjusted EBITDA is used to determine ourcompliance with many of the covenants contained in the indenturesgoverning the notes and in our senior credit agreement. Adjusted EBITDAis defined as EBITDA further adjusted to exclude unusual items andother adjustments permitted in calculating covenant compliance underthe indentures and our senior credit facility. We believe that theinclusion 

30

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

of supplementary adjustments to EBITDAapplied in presenting Adjusted EBITDA are appropriate to provideadditional information to investors to demonstrate compliance with ourfinancing covenants.

Adjusted EBITDA is calculated asfollows:

|                                  |  |                                      |       |                                      |  |                                     |         |                                     |  |        |       |         |  |        |         |         |  |  |
|----------------------------------|--|--------------------------------------|-------|--------------------------------------|--|-------------------------------------|---------|-------------------------------------|--|--------|-------|---------|--|--------|---------|---------|--|--|
| (dollarsin millions)             |  | Three Months endedSeptember 30, 2005 |       | Three Months ended September30, 2004 |  | Nine Months ended September 30,2005 |         | Nine Months ended September 30,2004 |
| Net earnings(loss)               |  | $                                    | 23.2  |                                 |  | $                                   | 12.4    |                                |  | $      | 37.2  |    |  | $      | (94.2   | )  |
| Interest,net                     |  |                                 | 56.2  |                                 |  |                                | 51.4    |                                |  |   | 164.6 |    |  |   | 152.0   |    |
| Incometaxprovision               |  |                                 | 21.0  |                                 |  |                                | 27.2    |                                |  |   | 33.9  |    |  |   | 46.8    |    |
| Depreciation                     |  |                                 | 33.3  |                                 |  |                                | 23.8    |                                |  |   | 100.0 |    |  |   | 80.7    |    |
| Amortization                     |  |                                 | 20.3  |                                 |  |                                | 23.9    |                                |  |   | 61.4  |    |  |   | 73.0    |    |
| EBITDA                           |  | $                                    | 154.0 |                                 |  | $                                   | 138.7   |                                |  | $      | 397.1 |    |  | $      | 258.3   |    |
| Non-cashcharges(1)               |  |                                 | 5.0   |                                 |  |                                | 14.5    |                                |  |   | 20.8  |    |  |   | 167.5   |    |
| Businessoptimization expenses(2) |  |                                 | 3.5   |                                 |  |                                | — |                                |  |   | 21.3  |    |  |   | — |    |
| Unusualitems(3)                  |  |                                 | 3.1   |                                 |  |                                | 2.2     |                                |  |   | 4.9   |    |  |   | 6.7     |    |
| Otheradjustments(4)              |  |                                 | (1.1  | )                               |  |                                | 1.9     |                                |  |   | (4.1  | )  |  |   | 5.6     |    |
| AdjustedEBITDA                   |  | $                                    | 164.5 |                                 |  | $                                   | 157.3   |                                |  | $      | 440.0 |    |  | $      | 438.1   |    |
|                                  |

|           |                                                             |
|-----------|-------------------------------------------------------------|
| (1)  | Non-cashcharges are further detailed on the followingtable: |

|                                                |  |                                      |         |                                      |  |                                     |         |                                     |  |        |         |        |  |        |         |        |  |  |
|------------------------------------------------|--|--------------------------------------|---------|--------------------------------------|--|-------------------------------------|---------|-------------------------------------|--|--------|---------|--------|--|--------|---------|--------|--|--|
| (dollarsin millions)                           |  | Three Months endedSeptember 30, 2005 |         | Three Months ended September30, 2004 |  | Nine Months ended September 30,2005 |         | Nine Months ended September 30,2004 |
| In-process research and development            |  | $                                    | — |                                 |  | $                                   | — |                                |  | $      | — |   |  | $      | 122.3   |   |
| Inventorystep-up                               |  |                                 | — |                                 |  |                                | — |                                |  |   | — |   |  |   | 14.5    |   |
| Assetwrite-offs                                |  |                                 | — |                                 |  |                                | — |                                |  |   | 4.9     |   |  |   | — |   |
| Profitsharing expense and 401(k) funded bySuez |  |                                 | 1.1     |                                 |  |                                | 8.0     |                                |  |   | 10.9    |   |  |   | 24.0    |   |
| Other                                          |  |                                 | 3.9     |                                 |  |                                | 6.5     |                                |  |   | 5.0     |   |  |   | 6.7     |   |
| Non-cashcharges                                |  | $                                    | 5.0     |                                 |  | $                                   | 14.5    |                                |  | $      | 20.8    |   |  | $      | 167.5   |   |
|                                                |

In-processResearch and Development

In-process research and developmentwas a one time charge of $122.3 million recorded during the nine monthsended September 30, 2004, as a result of purchase accounting entriesrelated to the Acquisition.

Inventory Step-Up

As aresult of purchase accounting for the Acquisition, we wrote up ourinventory to fair value and subsequently charged the write up to costof sales as the inventory was sold.

Profit Sharing and 401(k)Expense Funded by Suez

In conjunction with the Acquisition, weentered into an agreement with Suez whereby Suez will reimburse us forcertain profit-sharing and 401(k) matching contributions made by us tothe Profit-Sharing Trust.

Other

Other non-cash chargesinclude the non-cash impact on earnings of our equity investments andminority interests. Non-cash charges also includes the non-cash portionof rent expense under the sublease that we entered into with Suez inconjunction with the Acquisition.

31

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

|           |                                                                                                                                                                                                                                                                   |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2)  | Businessoptimization expenses for 2005 include costs associated with thede-layering of our management structure, cost reductions inlower-performing business units, and the redesign and optimization ofwork processes. See note 7 to Item 1 for moreinformation. |

|           |                                                          |
|-----------|----------------------------------------------------------|
| (3)  | Unusualitems are further detailed on the followingtable: |

|                                      |  |                                      |     |                                      |  |                                     |         |                                     |  |        |     |        |  |        |         |        |  |  |
|--------------------------------------|--|--------------------------------------|-----|--------------------------------------|--|-------------------------------------|---------|-------------------------------------|--|--------|-----|--------|--|--------|---------|--------|--|--|
| (dollars inmillions)                 |  | Three Months endedSeptember 30, 2005 |     | Three Months ended September30, 2004 |  | Nine Months ended September 30,2005 |         | Nine Months ended September 30,2004 |
| Loss (gain) on sales, net ofexpenses |  | $                                    | 2.6 |                                 |  | $                                   | — |                                |  | $      | 3.7 |   |  | $      | — |   |
| Other unusual items(a)               |  |                                 | 0.5 |                                 |  |                                | 2.2     |                                |  |   | 1.2 |   |  |   | 6.7     |   |
|                                 |  | $                                    | 3.1 |                                 |  | $                                   | 2.2     |                                |  | $      | 4.9 |   |  | $      | 6.7     |   |
|                                      |

|  |     |                                                                                                                                                                                                                                                                |
|--|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (a) | Otherunusual items for the nine months ended September 30, 2005 mostlyrepresent certain inventory write-offs. Other unusual items for thethree months and nine months ended September 30, 2004 primarily includecertain costs associated with theTransactions. |

|           |                                                                                                                                           |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------|
| (4)  | We arerequired to make adjustments to EBITDA for monitoring fees paid to theSponsors, franchise taxes, and 401(k) matching contributions. |

Our covenant levels and ratios for the four quarters ended September30, 2005 are asfollows:

|                                                                                                                                   |  |                                    |        |        |  |        |        |        |  |  |
|-----------------------------------------------------------------------------------------------------------------------------------|--|------------------------------------|--------|--------|--|--------|--------|--------|--|--|
|                                                                                                                              |  | CovenantLevel at September 30,2005 |        | Ratios |
| Senior creditfacility (1)                                                                                                         |  |                               |   |   |  |   |   |   |
|     MinimumAdjusted EBITDA to cash interestratio                                                              |  |                               | 1.70x  |   |  |   | 2.85x  |   |
|     Maximum netdebt to Adjusted EBITDAratio                                                                   |  |                               | 6.50x  |   |  |   | 4.92x  |   |
| Indentures(2)                                                                                                                     |  |                               |   |   |  |   |   |   |
|     Minimum Adjusted EBITDAto fixed charge ratio required to incur additional debt pursuant toratioprovisions |  |                               | 2.00x  |   |  |   | 2.91x  |   |
|                                                                                                                                   |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | During2005, our senior credit facility requires us to maintain an AdjustedEBITDA to cash interest ratio at a minimum of 1.70x and a net debt toAdjusted EBITDA ratio at a maximum of 6.50x, in each case for the mostrecent four quarter period. Failure to satisfy these ratio requirementswould constitute a default under the senior credit agreement. If ourlenders failed to waive any such default, our repayment obligationsunder the senior credit agreement could be accelerated, which wouldalso constitute a default under ourindentures. |

|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2)  | Our ability to incuradditional debt and make certain restricted payments under ourindentures, subject to specified exceptions, is tied to an AdjustedEBITDA to fixed charge ratio of at least 2.0 to 1, except that we mayincur certain debt and make certain restricted payments and certainpermitted investments without regard to the ratio, such as up to anaggregate principal amount of $1,950 million (including $1,201.2million that was outstanding under our term loan facilities as ofSeptember 30, 2005) and investments in similar business and otherinvestments equal to 6% of Nalco Holdings LLC consolidatedassets. |

Local lines of credit.    Certain of ournon-U.S. subsidiaries have lines of credit to support localrequirements. As of September 30, 2005, the aggregate outstandingbalance under these local lines of credit was approximately $18.3million. Certain of these lines of credit are equally and ratablysecured with obligations under our senior credit facilities.

Receivables facility.    Nalco Company entered into areceivables facility on June 25, 2004 that provides up to $100 millionin funding from a commercial paper conduit sponsored by JPMorgan ChaseBank, one of the lenders under Nalco Company's senior creditfacilities, based on availability of eligible receivables andsatisfaction of other customary conditions.

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|              |                                                                                                        |
|--------------|--------------------------------------------------------------------------------------------------------|
| Item2.  | Management's Discussion and Analysis ofFinancial Condition and Results ofOperations   (continued) |

Availability of funding under thereceivables facility depends primarily upon the outstanding tradeaccounts receivable balance from time to time. Aggregate availabilityis determined by using a formula that reduces the gross receivablesbalance by factors that take into account historical default anddilution rates, excessive concentrations and average days outstandingand the costs of the facility. Based on the terms of this facility andon the criteria described above, as of September 30, 2005,approximately $163.6 million of our accounts receivable balance wasconsidered eligible for financing under the program, of whichapproximately $87.0 million would have been available for funding. Asof September 30, 2005, we had $78.7 million of outstanding borrowingsunder this facility.

This facility is treated as a generalfinancing agreement resulting in the borrowings and related receivablesbeing shown as liabilities and assets, respectively, on ourconsolidated balance sheet and the costs associated with thereceivables facility being recorded as interest expense.

Item3.    Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to the Company's exposuresto market risk since December  31, 2004.

Item4.    Controls andProcedures

|           |                                                  |
|-----------|--------------------------------------------------|
| (a)  | Evaluation of disclosurecontrols and procedures. |

The Company's chiefexecutive officer and chief financial officer, after evaluating theeffectiveness of the Company's "disclosure controlsand procedures" (as defined in the Securities Exchange Actof 1934 Rules 13a-15(e) and 15d-15(e)) as of the end of the period,have concluded that the Company's disclosure controls andprocedures were adequate and designed to ensure that materialinformation relating to the Company and its consolidated subsidiarieswould be made known to them by others within those entities asappropriate to allow timely decisions regarding requireddisclosures.

|           |                                                       |
|-----------|-------------------------------------------------------|
| (b)  | Changes in internalcontrols over financial reporting. |

There were no changesin the Company's internal controls over financial reporting thatoccurred during the third quarter of 2005 that have materiallyaffected, or are reasonably likely to materially affect, theCompany's internal controls over financialreporting.

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PARTII.    OTHER INFORMATION

Item 1.    Legal Proceedings

The U.K. Health and Safety Executive("HSE") has sent notice that it intends toinitiate legal proceedings against the Company's U.K. subsidiaryunder the Health and Safety at Work Act. The place of these proceedingsis not indicated in the notice. This notice references a legionellaoutbreak that is claimed to have originated at cooling towers owned byone of the subsidiary's customers. The HSE indicates that theproceedings will relate to the cleaning of these cooling towers. TheCompany has not received any specific charges or claims for relief, butwill, in any event, defend and refute any contention that it hasviolated any law.

Item 6.    Exhibits

|           |                                   |
|-----------|-----------------------------------|
| (a)  | The following are includedherein: |

|              |
|--------------|
|              |  |  |  |  |  |  |
| Exhibit10.1  |  | Material Contracts – AmendmentNo. 3 to the Receivables Transfer Agreement |
| Exhibit10.2  |  | Material Contracts – Amendment No. 3 to CreditAgreement |
| Exhibit 31.1 |  | Certification ofChief Executive Officer, Pursuant to Section 302 of the Sarbanes-OxleyAct of 2002 |
| Exhibit 31.2 |  | Certification ofChief Financial Officer, Pursuant to Section 302 of the Sarbanes-OxleyAct of 2002 |
| Exhibit 32.1 |  | CertificationsPursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906of the Sarbanes-Oxley Act of 2002 |
|              |

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SIGNATURE

The Company hasduly caused this report to be signed on its behalf by the undersignedthereunto duly authorized.

|  | NALCO HOLDINGSLLC |
|--|-------------------|

|  | /s/ BRADLEY J.BELL                                Name:  Bradley J. Bell Title:    Executive VicePresident and             Chief Financial Officer |
|--|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Dated: November 10, 2005

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