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, 2005
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, 2005 and 2004
|
|
|
STATEMENT
OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
|
5
|
|
For
the years ended December 31, 2005 and 2004
|
|
|
NOTES
TO FINANCIAL STATEMENTS
|
6
|
|
SUPPLEMENTAL
SCHEDULES
|
13
|
|
Schedule
H, Part IV, Item 4(i) - Assets Held for Investment
Purposes
|
|
|
Schedule
H, Part IV, Item 4(j) - Reportable Transactions
|
|
|
EXHIBIT
INDEX
|
16
|
-2-
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 as of December 31, 2005
and
2004, 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 audit.
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. 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, 2005 and 2004,
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
audit
was 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
May
12,
2006
-3-
HERCULES
INCORPORATED SAVINGS AND INVESTMENT PLAN
STATEMENT
OF NET ASSETS AVAILABLE FOR BENEFITS
(Dollars
in Thousands)
|
December
31,
|
|||||||
|
2005
|
2004
|
||||||
|
ASSETS:
|
|||||||
|
Investments
(Note 4)
|
$
|
362,116
|
$
|
389,359
|
|||
|
Contributions
receivable
|
4,599
|
2,417
|
|||||
|
Total
assets
|
$
|
366,715
|
$
|
391,776
|
|||
|
LIABILITIES:
|
|||||||
|
Loan
payable (Note 7)
|
39,154
|
51,212
|
|||||
|
Total
liabilities
|
39,154
|
51,212
|
|||||
|
NET
ASSETS AVAILABLE FOR BENEFITS
|
$
|
327,561
|
$
|
340,564
|
|||
The
accompanying notes are an integral part of these financial
statements
-4-
HERCULES
INCORPORATED SAVINGS AND INVESTMENT PLAN
STATEMENT
OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(Dollars
in Thousands)
|
Year
Ended December 31,
|
|||||||
|
2005
|
2004
|
||||||
|
ADDITIONS:
|
|||||||
|
Increase
to net assets attributed to:
|
|||||||
|
Investment
income (loss)
|
|||||||
|
Net
(depreciation) appreciation in fair value
of
investments (Note 4)
|
$
|
(13,542
|
)
|
$
|
37,867
|
||
|
Interest
|
3,636
|
3,397
|
|||||
|
Dividends
|
6,436
|
3,326
|
|||||
|
Contributions:
|
|||||||
|
Participants
|
12,619
|
12,391
|
|||||
|
Employer
|
16,878
|
17,137
|
|||||
|
Transfers
from other plans (Note 9)
|
14
|
12,778
|
|||||
|
Total
Additions
|
26,041
|
86,896
|
|||||
|
DEDUCTIONS:
|
|||||||
|
Deductions
from net assets attributed to:
|
|||||||
|
Benefits
paid to participants
|
36,513
|
34,792
|
|||||
|
Administrative
expenses
|
14
|
8
|
|||||
|
Interest
Expense
|
2,517
|
2,737
|
|||||
|
Total
Deductions
|
39,044
|
37,537
|
|||||
|
Net
(Decrease) Increase
|
(13,003
|
)
|
49,359
|
||||
|
NET
ASSETS AVAILABLE FOR BENEFITS:
|
|||||||
|
Beginning
of year
|
340,564
|
291,205
|
|||||
|
End
of year
|
$
|
327,561
|
$
|
340,564
|
|||
The
accompanying notes are an integral part of these financial
statements
-5-
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 Investments
Plan
(the Plan) provides only general information. The Plan is a defined contribution
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, substantially all domestic 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. At time of enrollment in the Plan, participants may elect
to
contribute up to 50% of their annual wages on either a pre- or post-tax basis,
or a combination thereof. 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 shall direct the investment of their monthly
savings in any of the Plan’s investment options, or a combination thereof. For
employees hired on or after January 1, 2005, the Company also makes a Basic
Contribution (Basic Retirement Contribution) equal to 2% of their annual
wages.
The
Plan
provides for various investment options in any combination of stocks, bonds,
fixed income securities, mutual funds, and other investment securities.
Investment securities are exposed to various risks, such as interest rate,
market, and credit. Due to the level of risk associated with certain investment
securities and the level of uncertainty related to changes in the value of
investment securities, it is at least reasonably possible that changes in
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.
The
Plan
was amended effective January 1, 2003 to allow for profit sharing contributions
to eligible participants depending on the Company performance. Since the
Company
met its 2005 and 2004 target performance, discretionary employer contributions
were allocated to eligible participants accounts in the amounts of $1,293
and
$1,487 for 2005 and 2004, respectively. This profit sharing program ended
in
2005.
Effective
January 1, 2005, the Plan was amended to permit variable employer contribution
to eligible participants (salaried employees and those union employees who
have
negotiated participation in the Flexible Benefits Plans). The Performance
Retirement Contribution (PRC) is based on Company performance against specific
performance targets each year. Company performance at target will generate
an
average PRC contribution equal to 3% of participants annual wages. If the
Company exceeds the target, the average contribution could go up to 5% 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.
-6-
4.5%
of
pay for employees with 20 or more years of service.
For
2005,
the Company performance targets for the PRC was Operating Cash Flow. Based
on
performance against target, the Company made a PRC of $2,368 which was allocated
to eligible participant accounts.
The
fiduciary 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.
-7-
HERCULES
INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES
TO FINANCIAL STATEMENTS
(Dollars
in Thousands)
2. Summary
of Significant Accounting Policies
The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that
affect the reported amounts of assets, liabilities and changes therein and
disclosures of contingent 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 Hercules Blended Interest Fund is carried at cost plus investment
earnings less withdrawals, which is equivalent to contract value. 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.
In
December 2005, the FASB issued 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. This FSP amends
the
guidance in AICPA SOP 94-4, Reporting of Investment Contracts Held by Health
and
Welfare Benefit Plans and Defined-Contribution Pension Plans, with respect
to
the definition of the fully benefit-responsive and the presentation and
disclosure of fully benefit-responsive investment contracts. The financial
statement presentation and disclosure guidance in FSP AG INV-1 and SOP 94-4-1
is
effective for financial statements for the plan years ending after December
15,
2006. The Plan intends to adopt the financial presentation and disclosure
guidance in the FSP in the financial statements for the plan year ending
December 31, 2006.
|
3.
|
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. 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.
-8-
HERCULES
INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES
TO FINANCIAL STATEMENTS
(Dollars
in Thousands)
4. Investments
The
following table presents the fair values of investments held by the Trustee
at
December 31:
|
2005
|
2004
|
||||||
|
* Vanguard
500 Index Fund
|
$
|
43,154
|
$
|
46,495
|
|||
|
Vanguard
Explorer Fund
|
11,080
|
10,655
|
|||||
|
Vanguard
Extended Market Index Fund
|
6,740
|
5,506
|
|||||
|
* Vanguard
Growth & Income Fund
|
26,302
|
26,552
|
|||||
|
Vanguard
International Growth Fund
|
11,867
|
9,493
|
|||||
|
Vanguard
LifeStrategy Conservative Growth Fund
|
4,480
|
4,307
|
|||||
|
Vanguard
LifeStrategy Growth Fund
|
3,918
|
3,681
|
|||||
|
Vanguard
LifeStrategy Income Fund
|
2,903
|
2,731
|
|||||
|
Vanguard
LifeStrategy Moderate Growth Fund
|
8,424
|
7,850
|
|||||
|
* Vanguard
PRIMECAP Fund
|
42,546
|
44,145
|
|||||
|
Vanguard
Small-Cap Value Index Fund
|
9,278
|
7,141
|
|||||
|
Vanguard
Total Bond Market Index Fund
|
13,015
|
13,031
|
|||||
|
* Vanguard
Windsor II Fund
|
26,026
|
23,208
|
|||||
|
* Hercules
Common Stock Fund
|
61,668
|
90,970
|
|||||
|
Loan
Fund
|
4,700
|
4,705
|
|||||
|
* Hercules
Blended Interest Fund
|
86,015
|
88,889
|
|||||
|
Total
|
$
|
362,116
|
$
|
389,359
|
|||
|
* Represents
at Least 5% interest at December 31, 2005 and 2004
|
|||||||
Net
(depreciation) appreciation in fair value of investments for the Plan for
the
years ended December 31, 2005 and 2004 are as follows:
|
2005
|
2004
|
||||||
|
Hercules
Common Stock
|
$
|
(20,374
|
)
|
$
|
16,801
|
||
|
Mutual
Funds
|
6,832
|
21,066
|
|||||
|
Net
(depreciation) appreciation in fair value of investments
|
$
|
(13,542
|
)
|
$
|
37,867
|
||
-9-
HERCULES
INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES
TO FINANCIAL STATEMENTS
(Dollars
in Thousands)
|
5.
|
Employer
Contributions Received and
Receivable
|
As
of,
and for the years ended December 31, 2005 and 2004 respectively, the Company
made the following contributions to the Plan.
|
Stock
|
Cash
|
Total
|
||||||||
|
December
31, 2005
|
$
|
14,452
|
$
|
2,426
|
$
|
16,878
|
||||
|
December
31, 2004
|
$
|
17,137
|
$
|
—
|
$
|
17,137
|
||||
At
December 31, 2005 and 2004, $3,898 and $1,723, respectively were receivable
from
the Company.
|
6.
|
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
|
Employer
Contributions Receivable
|
Loan
|
Net
Assets
|
||||||||||
|
December
31, 2005
|
|||||||||||||
|
Hercules
Common Stock Fund
|
|||||||||||||
|
Participant-directed
|
$
|
3,664
|
$
|
—
|
$
|
—
|
$
|
3,664
|
|||||
|
Non-participant-directed
|
20,513
|
—
|
—
|
20,513
|
|||||||||
|
24,177
|
—
|
—
|
24,177
|
||||||||||
|
Hercules
ESOP Stock Fund
|
|||||||||||||
|
Allocated
Non-participant-directed
|
18,103
|
1,523
|
—
|
19,626
|
|||||||||
|
Unallocated
Non-participant-directed
|
19,418
|
—
|
(39,154
|
)
|
(19,736
|
)
|
|||||||
|
37,521
|
1,523
|
(39,154
|
)
|
(110
|
)
|
||||||||
|
$
|
61,698
|
1,523
|
(39,154
|
)
|
$
|
24,067
|
|||||||
|
December
31, 2004
|
|||||||||||||
|
Hercules
Common Stock Fund
|
|||||||||||||
|
Participant-directed
|
$
|
8,066
|
$
|
—
|
$
|
—
|
$
|
8,066
|
|||||
|
Non-participant-directed
|
28,522
|
—
|
—
|
28,522
|
|||||||||
|
36,588
|
—
|
—
|
36,588
|
||||||||||
|
Hercules
ESOP Stock Fund
|
|||||||||||||
|
Allocated
Non-participant-directed
|
22,981
|
1,723
|
—
|
24,704
|
|||||||||
|
Unallocated
Non-participant-directed
|
31,431
|
—
|
(51,212
|
)
|
(19,781
|
)
|
|||||||
|
54,
412
|
1,723
|
(51,212
|
)
|
4,923
|
|||||||||
|
$
|
91,000
|
$
|
1,723
|
$
|
(51,212
|
)
|
$
|
41,511
|
|||||
-10-
HERCULES
INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES
TO FINANCIAL STATEMENTS
(Dollars
in Thousands)
Investment
gain (loss) income for the years ended December 31, 2005 and 2004 are as
follows:
|
Hercules
Common
|
Hercules
ESOP Stock Fund
|
|||||||||
|
Stock
Funds
|
Allocated
|
Unallocated
|
||||||||
|
December
31, 2005
|
||||||||||
|
Net
(depreciation) in fair value of investments:
|
$
|
(8,009
|
)
|
$
|
(5,727
|
)
|
$
|
(6,638
|
)
|
|
|
Employer
contributions
|
24
|
—
|
14,575
|
|||||||
|
Employee
contributions
|
493
|
(117
|
)
|
—
|
||||||
|
Benefit
paid to participants
|
(2,645
|
)
|
(1,849
|
)
|
—
|
|||||
|
Interest
expense
|
(2
|
)
|
—
|
(2,518
|
)
|
|||||
|
Allocation
of shares under ESOP provisions
|
—
|
5,374
|
(5,374
|
)
|
||||||
|
Net
loan activity
|
119
|
(74
|
)
|
—
|
||||||
|
Transfer
to other investments options
|
(2,391
|
)
|
(2,685
|
)
|
—
|
|||||
|
Net
(decrease) increase
|
$
|
(12,411
|
)
|
$
|
(5,078
|
)
|
$
|
45
|
||
|
December
31, 2004
|
||||||||||
|
Net
appreciation in fair value of investments:
|
$
|
6,991
|
$
|
4,183
|
$
|
5,627
|
||||
|
Transfers
in from FiberVisions
|
1,189
|
—
|
—
|
|||||||
|
Employee
contributions
|
588
|
403
|
—
|
|||||||
|
Employer
contributions
|
—
|
—
|
16,752
|
|||||||
|
Benefit
paid to participants
|
(3,325
|
)
|
(1,732
|
)
|
—
|
|||||
|
Interest
expense
|
—
|
—
|
(2,737
|
)
|
||||||
|
Allocation
of shares under ESOP provisions
|
—
|
5,173
|
(5,173
|
)
|
||||||
|
Net
loan activity
|
3
|
(98
|
)
|
—
|
||||||
|
Transfer
to other investments options
|
(8,275
|
)
|
(4,007
|
)
|
—
|
|||||
|
Net
(decrease) increase
|
$
|
(2,829
|
)
|
$
|
(3,922
|
)
|
$
|
14,469
|
||
-11-
HERCULES
INCORPORATED SAVINGS AND INVESTMENT PLAN
NOTES
TO FINANCIAL STATEMENTS
(Dollars
in Thousands)
7. 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 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 as 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.
Interest rate of both loans at December 31, 2005 was 4.93%.
The
Plan
provides for the allocation of shares of Hercules common stock held by the
ESOP
component of the Plan, for periodic allocation 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 are $39,000 and $51,000 at December
31,
2005 and 2004, respectively.
8.
Related
Party Transactions
Certain
Plan investments are shares of mutual funds managed by the Trustee; therefore,
these transactions qualify as party-in-interest transactions.
9.
Merger
of FiberVisions Plans and FiberVisions Divesture
Effective
January 1, 2004 the FiberVision 401 (k) Savings and Investment Plan was merged
into Hercules Savings and Investment Plan. The net assets available for benefits
at December 31, 2003 for FiberVisions Inc. Saving and Investment Plan were
$12,800 , which included the participant loan balance of $814.
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, will be leaving
the
Plan and will participate in a plan sponsored by SPG/FV. This change is
anticipated to result in approximately $12,000 in assets being transferred
from
Hercules Savings and Investment Plan.
-12-
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, 2005
Hercules
Incorporated Savings and Investment Plan, EIN 51-0023450, PN 020
|
Identity
of Issue
|
Investment
Type
|
Cost
|
Current
Value
|
|||||||
|
*Vanguard
500 Index Inv
|
Registered
Investment Company
|
$
|
35,058,517
|
$
|
43,154,359
|
|||||
|
*Vanguard
Explorer Fund
|
Registered
Investment Company
|
9,031,937
|
11,079,550
|
|||||||
|
*Vanguard
Extended Market Index Inv
|
Registered
Investment Company
|
5,148,452
|
6,740,208
|
|||||||
|
*Vanguard
Growth & Income Inv
|
Registered
Investment Company
|
21,145,693
|
26,301,872
|
|||||||
|
*Vanguard
International Growth Fund
|
Registered
Investment Company
|
8,834,061
|
11,866,544
|
|||||||
|
*Vanguard
LifeStrategy Conservative Growth Fund
|
Registered
Investment Company
|
4,097,465
|
4,480,332
|
|||||||
|
*Vanguard
LifeStrategy Growth Fund
|
Registered
Investment Company
|
3,323,781
|
3,918,303
|
|||||||
|
*Vanguard
LifeStrategy Income Fund
|
Registered
Investment Company
|
2,799,170
|
2,902,966
|
|||||||
|
*Vanguard
LifeStrategy Moderate Growth Fund
|
Registered
Investment Company
|
7,371,487
|
8,423,971
|
|||||||
|
*Vanguard
PRIMECAP Fund
|
Registered
Investment Company
|
28,536,014
|
42,546,000
|
|||||||
|
*Vanguard
Small-Cap Value Index Fund
|
Registered
Investment Company
|
8,049,490
|
9,278,031
|
|||||||
|
*Vanguard
Total Bond Market Index Fund
|
Registered
Investment Company
|
13,224,579
|
13,015,073
|
|||||||
|
*Vanguard
Windsor II Fund
|
Registered
Investment Company
|
20,245,168
|
26,025,917
|
|||||||
|
*Hercules
Common Stock Fund
|
Company
Stock Fund
|
42,862,115
|
24,146,858
|
|||||||
|
*Hercules
ESOP Fund
|
Company
Stock Fund
|
25,029,454
|
18,103,028
|
|||||||
|
*Hercules
ESOP - Unallocated
|
Company
Stock Fund
|
13,317,585
|
19,417,897
|
|||||||
|
*Loan
Fund
|
5.25%-11.50
|
%
|
4,700,434
|
4,700,434
|
||||||
|
*Hercules
Blended Interest Fund
|
Unallocated
Insurance Contract
|
86,014,403
|
86,014,403
|
|||||||
|
Total
Assets Held for Investment Purposes
|
$
|
338,789,805
|
$
|
362,115,746
|
||||||
*
Indicates Party in Interest to the Plan
-13-
|
Identity
of Party Involved
|
Description
of Asset
|
Purchase
Price
|
Selling
Price
|
Historical
Cost of Asset
|
Current
Value of Asset on Transaction Date
|
Historical
Gain (Loss)
|
|||||||||||||
|
The
Vanguard Group
|
Hercules
Blended Fund
|
$
|
15,153,401
|
$
|
15,153,401
|
||||||||||||||
|
The
Vanguard Group
|
Hercules
Blended Fund
|
$
|
18,028,917
|
$
|
18,028,917
|
18,028,917
|
|||||||||||||
|
The
Vanguard Group
|
Hercules
Common Stock Fund
|
8,284,914
|
8,284,914
|
||||||||||||||||
|
The
Vanguard Group
|
Hercules
Common Stock Fund
|
11,838,386
|
15,568,287
|
11,838,386
|
(3,729,901
|
)
|
|||||||||||||
|
* 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.
|
|||||||||||||||||||
-14-
HERCULES
INCORPORATED SAVINGS AND INVESTMENT PLAN SCHEDULE
II
Schedule
of Reportable Transactions - Attachment for Schedule H, Line 4i
As
of
December 31, 2005
Hercules
Incorporated Savings and Investment Plan, EIN 51-0023450, PN 020
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
|
|
|
May
12, 2006
|
|
-15-
EXHIBIT
INDEX
|
Number
|
Description
|
|
23.1
|
Consent
of Independent Accountants
|
-16-