EXHIBIT
(10)O(ii)


 


AMENDMENT
NO. 1

TO THE ECOLAB INC. MANAGEMENT PERFORMANCE INCENTIVE PLAN

(as amended and restated on February 28, 2004)


 


 


WHEREAS, Ecolab Inc. (the “Company”) adopted an amended and restated
Management Incentive Plan (the “Plan”) effective as of February 28, 2004;
and


 


WHEREAS, the American Jobs Creation Act of 2004, P.L. 108-357 (the “AJCA”)
added a new Section 409A to the Internal Revenue Code (the “Code”), which
significantly changed the Federal tax law applicable to certain amounts deferred
under the Plan after December 31, 2004 that would be within the definition
of deferred compensation; and


 


WHEREAS, pursuant to the AJCA, the Secretary of the Treasury and the
Internal Revenue Service has issued guidance with respect to the provisions of
new Section 409A of the Code; and


 


WHEREAS, the Company intends for the benefits provided under the Plan
to not be subject to the requirements of Section 409A of the Code;


 


NOW THEREFORE, pursuant to Section 10 of the Plan, the Board of
Directors of the Company hereby adopts this Amendment No. 1 to the Plan,
effective as of January 1, 2005, which amendment is intended to cause all
amounts paid under the Plan to satisfy certain exceptions from being subject to
the requirements of Section 409A of the Code.


 


Section 1


 


Section 6 of
the Plan is amended to read as follows:


 


6.             Payment
of Awards.


 


As soon as practicable after the Committee has received the appropriate
financial and other data after the end of a Plan Year, the Committee will for
each Participant certify in writing the extent to which the applicable
Performance Goals for such Participant have been met and the corresponding
amount of the Award earned by such Participant. 
Payment of each Award in a cash lump sum, less applicable withholding
taxes pursuant to Section 8 of the Plan, shall be made as soon as
practicable thereafter, but no later than 21⁄2 months after the end of the Plan
Year.  Notwithstanding anything in the
Plan to the contrary, no payment made pursuant to any Award in respect of any Performance
Period shall exceed $3 million.   If the
Committee determines in good faith that there is a reasonable likelihood that
any compensation paid or payable to a Participant by the Company or a
Subsidiary pursuant to the Plan for a Plan Year would not be deductible by the
Company or the Subsidiary solely by reason of the limitation under Section


 





















 


162(m) of the Code, the Committee may reduce all or a portion of the
amounts otherwise payable pursuant to the Plan to the extent deemed necessary
by the Committee to ensure that the entire amount of any distribution to such
Participant is deductible.


 


Section 2


 


Section 7.2
of the Plan is amended to read as follows


 


7.2        Termination
for Reasons Other than Death, Disability or Retirement.  In the event a Participant’s employment is
terminated with the Company and all Subsidiaries prior to the end of the
Performance Period for any reason other than death, Disability or Retirement,
or a Participant is in the employ of a Subsidiary and the Subsidiary ceases to be
a Subsidiary of the Company (unless the Participant continues in the employ of
the Company or another Subsidiary), the Participant’s Award for such
Performance Period shall be immediately forfeited and the Participant shall
have no right to any payment thereafter; provided, however, that under such
circumstances the Committee may pay the Participant an amount not to exceed a
percentage of the amount earned according to the terms of the Award equal to
the portion of the Performance Period through the Participant’s
termination.  Any amount paid to the
Participant shall be made no later than 21⁄2 months after the end of the Plan
Year of such Performance Period.