UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
Annual Report
ý ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2007
OR
o TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Commission File Number 001-496
HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
Issuer of the securities held pursuant to the Plan
A Delaware Corporation
I.R.S. Employer Identification No. 51-0023450
Hercules Plaza
1313 North Market Street
Wilmington, Delaware 19894-0001
Telephone: 302-594-5000
INDEX TO FINANCIAL STATEMENT AND REQUIRED SUPPLEMENTARY DATA
| Page | ||||
| REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 3 | |||
| STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS | 4 | |||
| At December 31, 2007 and 2006 | ||||
| STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS | 5 | |||
| For the years ended December 31, 2007 and 2006 | ||||
| NOTES TO FINANCIAL STATEMENTS | 6 | |||
| SUPPLEMENTAL SCHEDULES | ||||
| Schedule H, Part IV, Item 4(i) – Assets Held for Investment Purposes | 13 | |||
| Schedule H, Part IV, Item 4(j) – Reportable Transactions | 14 | |||
| EXHIBIT INDEX | 16 | |||
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Hercules Incorporated Savings and Investment Plan
Wilmington, Delaware
We have audited the accompanying statements of net assets available for benefits of Hercules Incorporated Savings and Investment Plan (the “Plan”) as of December 31, 2007 and 2006, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The plan is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of Hercules Incorporated Savings and Investment Plan as of December 31, 2007 and 2006, and changes in its net assets available for benefits for the years then ended, in conformity with accounting principles generally accepted in the United States.
Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of assets held for investment purposes and reportable transactions are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. These supplemental schedules are the responsibility of the Plan’s management. The supplemental schedules have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole.
/s/ MorisonCogen LLP
Bala Cynwyd, Pennsylvania
June 23, 2008
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
(Dollars in Thousands)
| December 31, | ||||||||
| 2007 | 2006 | |||||||
| ASSETS: | ||||||||
| Investments (at fair value) (Note 3) | $ | 396,636 | $ | 386,988 | ||||
| Employee Loans Receivable (Note 3) | 4,463 | 3,896 | ||||||
| Total (at fair value) | 401,099 | 390,884 | ||||||
| Contributions receivable | 7,180 | 7,531 | ||||||
| Total assets | $ | 408,279 | $ | 398,415 | ||||
| LIABILITIES: | ||||||||
| Loan payable (Note 6) | 18,192 | 28,297 | ||||||
| Total liabilities | 18,192 | 28,297 | ||||||
| Net assets reflecting all investments at fair value | 390,087 | 370,118 | ||||||
Adjustment from fair value to contract value for fully benefit – responsive investment contract | (590 | ) | 727 | |||||
| NET ASSETS AVAILABLE FOR BENEFITS | $ | 389,497 | $ | 370,845 | ||||
The accompanying notes are an integral part of these financial statements
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(Dollars in Thousands)
Year Ended December 31, | ||||||||
| 2007 | 2006 | |||||||
| ADDITIONS: | ||||||||
| Increase to net assets attributed to: | ||||||||
| Investment income | ||||||||
| Net (depreciation) appreciation in fair value of investments (Note 3) | $ | (17 | ) | $ | 57,719 | |||
| Interest | 3,715 | 3,694 | ||||||
| Dividends | 15,452 | 9,831 | ||||||
| Contributions: | ||||||||
| Participants | 13,874 | 12,869 | ||||||
| Employer | 15,201 | 18,757 | ||||||
| Transfers from other plans | 9 | 10 | ||||||
| Total Additions | 48,234 | 102,880 | ||||||
DEDUCTIONS: | ||||||||
| Deductions from net assets attributed to: | ||||||||
| Benefits paid to participants | 27,231 | 46,034 | ||||||
| Transfers to other plans (Note 9) | — | 11,139 | ||||||
| Administrative expenses | 96 | 26 | ||||||
| Interest Expense | 2,255 | 2,397 | ||||||
| Total Deductions | 29,582 | 59,596 | ||||||
| Net Increase | 18,652 | 43,284 | ||||||
NET ASSETS AVAILABLE FOR BENEFITS: | ||||||||
| Beginning of year | 370,845 | 327,561 | ||||||
| End of year | $ | 389,497 | $ | 370,845 | ||||
The accompanying notes are an integral part of these financial statements
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in Thousands)
1. Description of Plan
The following description of the Hercules Incorporated Savings and Investment Plan (the “Plan”) provides only general information. The Plan is a defined contribution Internal Revenue Code (“IRC”) Section 401(k) plan subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”). Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions.
Upon hire, all United States Hercules Incorporated ("Hercules" or the "Company") employees are immediately eligible to participate in the Plan and obtain immediate, non-forfeitable (“vested”) rights to the full market value of their account. Upon hire, all new employees are immediately enrolled in the Plan unless they choose not to participate. At time of enrollment in the Plan, participants may elect to contribute up to 50% of their annual wages on either a pre-tax or post-tax basis, or a combination thereof subject to IRC limitations. The Company contributes, in the form of Hercules Incorporated common stock, 50% of the first 6% of the annual earnings that an employee contributes to the Plan. Participants can also elect to immediately diversify their Company matching common stock contribution into any Plan investment option. Participants direct the investment of their monthly savings into any of the Plan’s investment options, or a combination thereof. Eligible participants are also eligible to receive a performance-based employer contribution based on pre-established performance metrics. For employees hired on or after January 1, 2005, the Company also makes a Basic Retirement Contribution equal to 2% of their earnings each pay period.
The Plan provides for various stock, bond, and fixed income mutual fund investment options and Hercules common stock. These investments are exposed to various risks, such as interest rate, market, and credit. Due to the level of risk associated with certain of these investments and the level of uncertainty related to changes in the value of investments, it is at least reasonably possible that changes in one or more of these or other risks in the near term could materially affect participants’ account balances and the amounts reported in the statement of net assets available for benefits and the statement of changes in net assets available for benefits.
The Plan includes an employee loan provision authorizing participants to borrow a minimum of $1,000 up to a maximum amount that is equal to the lesser of $50,000 or 50% of their vested balances in the Plan. The loans are executed by promissory notes and have a minimum term of 12 months and a maximum term of 60 months, except for qualified residential loans, which have a maximum term of 120 months. The loans bear an interest rate equal to the average rate charged by selected major banks to prime customers for secured loans plus one percent. The loans are repaid over the term in monthly installments of principal and interest by payroll deduction. A participant also has the right to repay the loan in full at any time without penalty.
Effective January 1, 2005, the Plan was amended to permit variable employer contributions to eligible participants (salaried employees and those union employees who have negotiated participation in the Flexible Benefits Plans). This Performance Retirement Contribution (“PRC”) is based on Company performance each year against specific performance targets. Company performance at target will generate an average PRC contribution equal to 3% of participant’s annual wages. If the Company’s performance exceeds the target, the average contribution could go up to 6% of annual wages. If the Company achieves the target in a given year and generates a 3% pool, the Company will make contributions to the participants’ accounts at the beginning of the following year in these amounts:
1.5% of pay for employees with less than 11 years of service.
3% of pay for employees with at least 11, but less than 20 years of service.
4.5% of pay for employees with 20 or more years of service.
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in Thousands)
The Company performance target for the PRC for both 2007 and 2006 was Operating Cash Flow. Based on performance against target, the Company made a PRC of $6,236 and $6,609 for 2007 and 2006, respectively, which was allocated to eligible participant accounts.
The Finance Committee of the Hercules Incorporated Board of Directors has appointed The Vanguard Group (“Trustee”) as both the Trustee and Recordkeeper for the Plan, effective July 1, 2002.
Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA.
2. Summary of Significant Accounting Policies
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and changes therein and disclosures of assets and liabilities at the date of the financial statements. Actual results could differ from those estimates.
The financial statements of the Plan are prepared under the accrual method of accounting. Investments in the Plan are carried at fair value. The fair value of the common stock of Hercules Incorporated is based upon the price at which the stock closed on the New York Stock Exchange on the last business day of the year. The market values for funds managed by the Trustee are valued at the net asset value of the shares held by the Plan at year-end, which is based on the fair value of the underlying securities held by the fund. Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis and dividends are recorded on the ex-dividend date.
Withdrawals are recorded upon distribution. The Plan provides that participants who retire from the Company may elect, upon retirement, an Optional Valuation Date ("OVD") for determining their final withdrawal. The OVD is the last business day of any month following retirement, in which the distribution is requested.
As described in the Financial Accounting Standards Board (“FASB”) Staff Position (FSP) AAG INV-1 and SOP 94-4-1, Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain Investment companies Subject to the AICPA Investment Company Guide and Defined-Contribution Health and Welfare and Pension Plans, investment contracts (as defined in the FSP) held by a defined-contribution plan are to be reported at fair value. However, for these specific investments, contract value is the more relevant measurement because contract value is the amount participants would receive. As required by the FSP, the Statement of Net Assets Available for Benefits presents the investment contracts at fair value within the “Investments” category. An adjustment from fair value to contract value for these investments is then reflected in the Statement of Net Assets. The Statement of Changes in Net Assets Available for Benefits is prepared on a contract value basis. The Vanguard Retirement Savings Trust in 2007 and the Hercules Blended Interest Fund in 2006 held investment contracts in a common collective trust and are subject to the requirements of the FSP. The fair value, adjustment to contract value and contract value for investments within these funds subject to the requirements of the FSP are as follows:
| Adjustment to | ||||||||||||
| Fair Value | Contract Value | Contract Value | ||||||||||
| December 31, 2007 | $ | 78,037 | $ | (590 | ) | $ | 77,447 | |||||
| December 31, 2006 | 75,523 | 727 | 76,250 | |||||||||
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in Thousands)
3. Investments
The following table presents the fair values of investments held by the Trustee at December 31:
| 2007 | 2006 | |||||||
| * Vanguard 500 Index Fund | $ | 45,638 | $ | 45,167 | ||||
| Vanguard Explorer Fund | 9,613 | 10,517 | ||||||
| Vanguard Extended Market Index Fund | 7,796 | 7,727 | ||||||
| * Vanguard Growth & Income Fund | 24,331 | 25,551 | ||||||
| * Vanguard International Growth Fund | 25,940 | 19,708 | ||||||
| * Vanguard PRIMECAP Fund | 44,263 | 42,351 | ||||||
| Vanguard Small-Cap Value Index Fund | 9,630 | 12,627 | ||||||
| Vanguard Total Bond Market Index Fund | 19,133 | 14,392 | ||||||
| * Vanguard Windsor II Fund | 27,349 | 27,476 | ||||||
| * Hercules Common Stock Fund | 74,524 | 82,445 | ||||||
| * Vanguard Retirement Savings Trust | 78,037 | — | ||||||
| * Hercules Blended Interest Fund | — | 75,523 | ||||||
| Vanguard Target Retirement 2005 Fund | 4,021 | 1,628 | ||||||
| Vanguard Target Retirement 2010 Fund | 224 | — | ||||||
| Vanguard Target Retirement 2015 Fund | 10,408 | 10,356 | ||||||
| Vanguard Target Retirement 2020 Fund | 352 | — | ||||||
| Vanguard Target Retirement 2025 Fund | 9,358 | 7,793 | ||||||
| Vanguard Target Retirement 2030 Fund | 124 | — | ||||||
| Vanguard Target Retirement 2035 Fund | 3,058 | 2,426 | ||||||
| Vanguard Target Retirement 2040 Fund | 89 | — | ||||||
| Vanguard Target Retirement 2045 Fund | 1,212 | 724 | ||||||
| Vanguard Target Retirement 2050 Fund | 26 | — | ||||||
| Vanguard Target Retirement Income | 1,510 | 577 | ||||||
| $ | 396,636 | $ | 386,988 | |||||
| Employee Loans Receivable | 4,463 | 3,896 | ||||||
| Total | $ | 401,099 | $ | 390,884 | ||||
| * Represents at least 5% of the Plan’s net assets at December 31, 2007 or 2006 | ||||||||
Net (depreciation) appreciation in fair value of investments for the Plan for the years ended December 31, 2007 and 2006 are as follows:
| 2007 | 2006 | |||||||
| Hercules Common Stock | $ | 253 | $ | 38,555 | ||||
| Mutual Funds | (270 | ) | 19,164 | |||||
| Net appreciation (depreciation) in fair value of investments | $ | (17 | ) | $ | 57,719 | |||
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in Thousands)
| 4. | Employer Contributions Received and Receivable |
As of, and for the years ended December 31, 2007 and 2006 respectively, the Company made the following contributions to the Plan.
| Stock | Cash | Total | ||||||||||
| December 31, 2007 | $ | 14,843 | $ | 358 | $ | 15,201 | ||||||
| December 31, 2006 | $ | 18,566 | $ | 191 | $ | 18,757 | ||||||
At December 31, 2007 and 2006, $6,480 and $6,840, respectively were receivable from the Company.
| 5. | Non-participant-directed Investments |
Information about the net assets and the significant components of the changes in net assets relating to the non-participant-directed investments is as follows:
| Investments | Contributions Receivable | Loan | Net Assets | |||||||||||||
| December 31, 2007 | ||||||||||||||||
| Hercules Common Stock Fund (participant-directed) | $ | 26,660 | $ | 32 | $ | — | $ | 26,692 | ||||||||
| 26,660 | 32 | — | 26,692 | |||||||||||||
| Hercules ESOP Stock Fund (non-participant-directed) | ||||||||||||||||
| Allocated | 29,397 | 6,454 | — | 35,851 | ||||||||||||
| Unallocated | 18,467 | — | (18,192 | ) | 275 | |||||||||||
| 47,864 | 6,454 | (18,192 | ) | 36,126 | ||||||||||||
| $ | 74,524 | $ | 6,486 | $ | (18,192 | ) | $ | 62,818 | ||||||||
| December 31, 2006 | ||||||||||||||||
| Hercules Common Stock Fund (participant-directed) | $ | 30,013 | $ | 33 | $ | — | $ | 30,046 | ||||||||
| 30,013 | 33 | — | 30,046 | |||||||||||||
| Hercules ESOP Stock Fund (non-participant-directed) | ||||||||||||||||
| Allocated | 26,454 | 6,817 | — | 33,271 | ||||||||||||
| Unallocated | 25,978 | — | (28,297 | ) | (2,319 | ) | ||||||||||
| 52,432 | 6,817 | (28,297 | ) | 30,952 | ||||||||||||
| $ | 82,445 | $ | 6,850 | $ | (28,297 | ) | $ | 60,998 | ||||||||
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in Thousands)
Investment income (loss) for the years ended December 31, 2007 and 2006 are as follows:
| Hercules Common | Hercules ESOP Stock Fund | |||||||||||
Stock Funds | Allocated | Unallocated | ||||||||||
| December 31, 2007 | ||||||||||||
| Net appreciation (depreciation) in fair value of investments | $ | 203 | $ | (207 | ) | $ | 330 | |||||
| Employer contributions | 84 | 2,345 | 12,445 | |||||||||
| Employee contributions | 640 | — | — | |||||||||
| Benefit paid to participants | (1,662 | ) | (1,578 | ) | — | |||||||
| Interest expense | (10 | ) | — | (2,255 | ) | |||||||
| Allocation of shares under ESOP provisions | — | 7,854 | (7,854 | ) | ||||||||
| Net loan activity | 65 | (197 | ) | — | ||||||||
| Transfer to other investment options | (2,674 | ) | (5,709 | ) | — | |||||||
| Net (decrease) increase | $ | (3,354 | ) | $ | 2,508 | $ | 2,666 | |||||
| December 31, 2006 | ||||||||||||
| Net appreciation in fair value of investments | $ | 14,607 | $ | 12,315 | $ | 11,633 | ||||||
| Employer contributions | 60 | 5,346 | 13,255 | |||||||||
| Employee contributions | 503 | — | — | |||||||||
| Benefit paid to participants | (2,845 | ) | (2,295 | ) | — | |||||||
| Interest expense | (4 | ) | — | (2,397 | ) | |||||||
| Allocation of shares under ESOP provisions | — | 5,074 | (5,074 | ) | ||||||||
| Net loan activity | 69 | (131 | ) | — | ||||||||
| Transfer to other investment options | (6,521 | ) | (6,664 | ) | — | |||||||
| Net increase | $ | 5,869 | $ | 13,645 | $ | 17,417 | ||||||
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in Thousands)
6. Loan Payable
Pursuant to a loan agreement entered into with the Company in 2001, the Plan borrowed $11,000 in December 2001. This loan has a maturity date of December 31, 2020, bears interest at a rate of LIBOR plus 2.75% and has a fixed principal payment schedule of $200 per year on December 31 of each year from 2002 through 2019, with a balloon payment of $7,400 payable on December 31, 2020. On April 29, 2002, the Plan borrowed an additional $75,000 from the Company. This second loan has a maturity date of December 31, 2020, bears interest at a rate of LIBOR plus 2.75% and has a fixed payment schedule of $250 at the end of each calendar quarter as follows: $250 on June 30, 2002 and $250 on the last day of each quarter thereafter, with any remaining principal balance payable on December 31, 2020. In addition to the combined fixed payments of $1,200 for the loans, the Plan made additional payments of $8,905 and $9,657 in 2007 and 2006, respectively. These payments were calculated based on the number of shares that were allocated to participants’ accounts during the year. Principal payments on the loans are made in the same proportion as shares are released from the ESOP. The interest rate of both loans at December 31, 2007 was 7.98%.
The Plan provides for the periodic allocation of shares of Hercules common stock held by the ESOP component of the Plan to the account of Plan participants to satisfy Hercules’ matching obligations. The unallocated shares of the ESOP are pledged as security for the loans. The value of the outstanding borrowings under the promissory notes is $18,192 and $28,297 at December 31, 2007 and 2006, respectively.
7. Related Party Transactions
Certain Plan investments are shares of mutual funds managed by the Trustee; therefore, these transactions qualify as party-in-interest transactions.
8. Tax Status
On March 18, 2003, the United States Treasury Department advised the Company that the Plan as amended through January 28, 2002, is a qualified trust under Section 401(a) of the Internal Revenue Code and is therefore exempt from Federal income taxes under provisions of Section 501(a) of the code. The Plan has been amended since receiving the determination letter, to include, among other things, the merger of the BetzDearborn Plan and the performance based and fixed contributions. However, the Plan administrator and the Plan’s tax counsel believe that the Plan is designed and currently being operated in compliance with the applicable requirements of the Internal Revenue Code.
9. FiberVisions Divesture
On March 31, 2006, the Company completed the sale of a 51% interest in FiberVisions Delaware Corporation to SPG/FV Investor, LLC (“SPG/FV”). In connection with the transaction, effective April 1, 2006, FiberVisions employees, who were participants in the Hercules Savings and Investment Plan, left the Plan and participate in a plan sponsored by SPG/FV. This change resulted in $11,139 in assets being transferred from Hercules Savings and Investment Plan.
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in Thousands)
10. Recently Issued Accounting Pronouncements
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (“SFAS 157”). SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. The Administrator of the Plan does not believe the adoption of SFAS 157 will impact the amounts reported in the financial statements, however, additional disclosures will be required about the inputs used to develop the measurements of fair value and the effect of certain measurements reported on the Statement of Changes in Net Assets.
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN SCHEDULE I
Schedule of Assets Held for Investment Purposes at End of Year – Attachment for Schedule H, Line 4i
As of December 31, 2007
Hercules Incorporated Savings and Investment Plan, EIN 51-0023450, PN 020
| Identity of Issue | Investment Type | Cost/Contract Value | Current/Contract Value | ||||||
| *Vanguard 500 Index Investment | Registered Investment Company | $ | 34,497,653 | $ | 45,637,683 | ||||
| *Vanguard Explorer Fund | Registered Investment Company | 9,027,479 | 9,613,097 | ||||||
| *Vanguard Extended Market Index Investment | Registered Investment Company | 6,126,172 | 7,795,405 | ||||||
| *Vanguard Growth & Income Investment | Registered Investment Company | 21,086,140 | 24,331,183 | ||||||
| *Vanguard International Growth Fund | Registered Investment Company | 22,098,694 | 25,939,601 | ||||||
| *Vanguard PRIMECAP Fund | Registered Investment Company | 30,771,527 | 44,263,313 | ||||||
| *Vanguard Small-Cap Value Index | Registered Investment Company | 9,190,706 | 9,629,796 | ||||||
| *Vanguard Target Retirement 2005 | Registered Investment Company | 3,940,465 | 4,021,168 | ||||||
| *Vanguard Target Retirement 2010 | Registered Investment Company | 227,664 | 224,051 | ||||||
| *Vanguard Target Retirement 2015 | Registered Investment Company | 9,674,390 | 10,407,949 | ||||||
| *Vanguard Target Retirement 2020 | Registered Investment Company | 360,967 | 352,184 | ||||||
| *Vanguard Target Retirement 2025 | Registered Investment Company | 8,489,567 | 9,357,849 | ||||||
| *Vanguard Target Retirement 2030 | Registered Investment Company | 124,274 | 123,645 | ||||||
| *Vanguard Target Retirement 2035 | Registered Investment Company | 2,785,128 | 3,058,217 | ||||||
| *Vanguard Target Retirement 2040 | Registered Investment Company | 92,748 | 89,380 | ||||||
| *Vanguard Target Retirement 2045 | Registered Investment Company | 1,140,747 | 1,212,180 | ||||||
| *Vanguard Target Retirement 2050 | Registered Investment Company | 27,537 | 26,228 | ||||||
| *Vanguard Target Retirement Inc | Registered Investment Company | 1,466,441 | 1,510,098 | ||||||
| *Vanguard Total Bond Market Index | Registered Investment Company | 18,996,234 | 19,133,383 | ||||||
| *Vanguard Windsor II Fund Investment | Registered Investment Company | 23,767,211 | 27,348,650 | ||||||
| *Vanguard Retire Savings Trust | Common/Collective Trust | 77,446,730 | 77,446,730 | ||||||
| *Hercules Common Stock Fund | Company Stock Fund | 28,255,310 | 26,659,846 | ||||||
| *Hercules ESOP Fund | Company Stock Fund | 25,652,843 | 29,396,928 | ||||||
| *Hercules ESOP – Unallocated | Company Stock Fund | 18,429,155 | 18,467,330 | ||||||
| Subtotal | $ | 353,675,782 | $ | 396,045,894 | |||||
| *Loan Fund | 5.25% - 9.75% | 4,462,705 | 4,462,705 | ||||||
| Total Assets Held for Investment Purposes | $ | 358,138,487 | $ | 400,508,599 | |||||
| *Party in Interest | |||||||||
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HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN SCHEDULE II
Schedule of Reportable Transactions – Attachment for Schedule H, Line 4j
As of December 31, 2007
Hercules Incorporated Savings and Investment Plan, EIN 51-0023450, PN 020
| Identity of Party Involved | Description of Asset (include interest) | Purchase Price | Selling Price | Historical Cost of Asset | Current Value of Asset on Transaction Date* | Historical Gain | |||||||||||||||
| The Vanguard Group | Vanguard Retirement Savings Trust | $ | 82,483,336 | $ | 82,483,336 | ||||||||||||||||
| The Vanguard Group | Vanguard Retirement Savings Trust | $ | 5,036,607 | $ | 5,036,607 | 5,036,607 | — | ||||||||||||||
| The Vanguard Group | Hercules Blended Interest Fund | 16,720,686 | 16,720,686 | ||||||||||||||||||
| The Vanguard Group | Hercules Blended Interest Fund | 92,970,538 | 92,970,538 | 92,970,538 | — | ||||||||||||||||
| The Vanguard Group | Hercules Common Stock Fund | 15,551,007 | 15,551,007 | ||||||||||||||||||
| The Vanguard Group | Hercules Common Stock Fund | 15,883,828 | 14,501,756 | 15,883,828 | 1,382,071 | ||||||||||||||||
| * Transactions or a series of transactions in excess of 5% of the current value of the Plan's assets as of the beginning of the plan | |||||||||||||||||||||
| year as defined in Section 2520.103-6 of the Department of Labor Rules and Regulations for Reporting and Disclosure under ERISA. | |||||||||||||||||||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the Plan) have duly caused this annual report to be signed by the undersigned hereunto duly authorized.
| HERCULES INCORPORATED SAVINGS AND INVESTMENT PLAN | |
| /s/ Edward V. Carrington | |
Edward V. Carrington Vice President, Human Resources Plan Administrator | |
| June 23, 2008 | |
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EXHIBIT INDEX
| Number | Description |
| 23.1 | Consent of Independent Accountants |
- 16 -