Exhibit 10.34


 


December
28, 2004


 


Mr. Paul C. Raymond III


60 Trish Court


Danville, CA 
94506


 


Dear Paul:


 


I am pleased to confirm the
terms and conditions of your offer to join Hercules Incorporated in the
position of Vice President and President Pulp and Paper Division effective upon
your reporting date – sometime January 2005. 
This position will report to the Chief Executive Officer.


 


Our offer includes the
following components:


 


1.               Annual Base Salary:  $300,000 payable in 12 equal monthly installments.  Pursuant to our salary administration policy,
salary reviews are conducted each March 1st.  Your first cycle review will be based on a
March 1, 2006 review date.


 


2.               Annual Incentive Compensation: Your target annual incentive opportunity
under the Hercules Management Incentive Compensation Plan (MICP) for calendar
year 2005, is $150,000 (50% of benchmark salary).  The range, based on performance, is a
function of Corporate performance (pool funding) business results and
individual performance against accountabilities. The maximum payout is 200% of
the target and, of course, the minimum is zero. Any payouts above the target
amount may be made in restricted stock.


 


3.               Long-Term Incentive: In this position, you are eligible to
receive annual grants under the Hercules Long-Term Incentive Compensation Plan
(LTICP).  The value of the 2005 award,
which is normally made in March, is $383,000. 
This award may be made in any of the forms of equity described in the
Hercules Long-Term Incentive Compensation plan document attached.  For 2005, we anticipate making restricted
stock grants subject to Board approval. 
Change in control vesting applies.


 


4.               Benefits: Your approximate four years of service with
Honeywell will be recognized for purposes of eligibility to receive benefits
and vesting.  You will accrue benefits
based on your actual Hercules service pursuant to the terms of the Pension Plan
of Hercules Incorporated.  Benefits will
be funded to the extent legally possible under the qualified pension plan trust
with the balance paid under the unfunded non-qualified pension restoration
plan.  As mentioned, we recently amended
our Pension Plan to provide for additional 401-k contributions in lieu of a
defined benefit pension plan.  The
enclosed newsletter #2 on pages 2 and 3 more fully describes this.


 


Other benefits are described
in the attached Benefits Choices Enrollment Guide.


 





















 


Your 4 years service will
qualify you for any described benefits. 
In calendar year 2005, you will be eligible for 4 weeks paid
vacation.  Subsequent years will be the
greater of 4 weeks or the standard accrual.


 


5.               Avoidance of Compensation
Forfeiture:  Based on your notification that, as a result
of your accepting employment with Hercules, you will forfeit certain equity and
cash benefits under Honeywell’s compensation plans, we will pay or grant you
the following at such times indicated:


 


1.                           $100,000 immediately upon your first day of
employment


2.                           15,000 Restricted Stock shares vesting 33%
each anniversary (5,000 vest 1/06; 5,000 vest 1/07; and 5,000 vest 1/08).


3.                           $100,000 on the date your 2004 Honeywell
annual bonus for 2004 would otherwise be payable.


 


6.               Severance Benefits:  The
Severance Pay Plan as described in the Summary Plan Description will apply
subject to the following modifications, which shall apply with respect to your
employment, but shall otherwise not be part of the Severance Pay Plan:


 


Special Dismissal Benefit –
Severance Pay Plan


 


•                  Qualifying conditions of “reorganization” or “reduction
in the workforce” as defined in the Severance Pay Plan shall include (i) a
transfer to a new work location which is 30 or more miles greater than the
current distance from your residence to the Hercules Wilmington headquarters,
(ii) termination of your employment for reasons other than “cause” or
demonstrated poor performance, and (iii) a reduction in your compensation
unrelated to your performance which is disproportionately greater than
reductions generally imposed on other Hercules employees in your Band level.  [As used herein, “cause” shall mean: (a) the
willful and continued failure to substantially perform your duties (other than
any such failure resulting from incapacity due to physical or mental illness)
following your receipt of notice which specifically identifies such failure and
which provides a reasonable opportunity to cure; or (b) the willful engaging by
you in illegal conduct or gross misconduct that is materially and demonstrably
injurious to the Company.]


 


•                  Should you be notified your job location is
changing as defined in sub-paragraph (i) above, or of any other event which
qualifies you for a Special Dismissal Benefit under sub-paragraph (iii) above,
you must notify Hercules within 30 days of such notification of your rejection
of the job at the new location or of your claim for Special Dismissal Benefits
pursuant to the terms of this letter.


 


•                  Should severance benefits become payable,
your benefit shall be the greater of (i) the then current year’s base salary
plus target bonus, or (ii) the benefit payable under the formula stated in the
Severance Pay Plan or any modified or successor plan.


 


•                  Should the Severance Pay Plan be terminated,
and should the items set forth in


 


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sub-paragraphs (i), (ii) or (iii) occur, and subject to your compliance
with the notification requirements set forth above, you will nonetheless remain
eligible to receive Special Dismissal Benefits of the then year’s base salary
plus target bonus plus three months’ paid medical benefits.


 


7.               Relocation Benefits:  The
Hercules Relocation Policy applicable to “homeowner” employees will apply.  A copy of that Policy is enclosed.  Due to Sarbanes Oxley, we are unable to
implement the equity advance provision. 
Please discuss alternatives with me.


 


8.               Deferred Compensation: Beginning calendar year 2005, you become
eligible to participate in the Hercules Deferred Compensation Plan.  This Plan provides the option to defer
before-tax salary and/or target MICP amounts. 
More information will be provided to you on this plan when you become
eligible to participate.


 


9.               Parking: Your position qualifies for Company paid
parking in the Hercules Plaza garage or if not available, the nearest facility.


 


10.         Starting Date:  Contingent upon your acceptance,
we anticipate a starting date sometime during the second half of January
2005.  Should you start on any date other
than the third of January, your monthly base salary will be prorated.


 


This offer is contingent
upon your passing our standard substance abuse examination.  We will contact you to schedule this simple
test.  Additionally, we must verify U.S.
employment eligibility under the Immigration Reform and Control Act.  We will discuss what is needed when you first
report.  Finally, this offer is
contingent upon successful completion of a background check as appropriate for
the position and in accordance with applicable law.  This contingency must be met before your
anticipated starting date.


 


Attached are two forms for
the background check:  1) Release
Authorization, and 2) Disclosure to Employment Applicant Regarding Procurement
of A Consumer Report.  Please complete,
sign and date both forms (the Disclosure form contains the Summary of your
Rights under the Fair Credit Reporting Act – you should retain a copy for your
records) and FAX them to Michelle Levitskie, Manager, Organization Development
and HR Initiatives, at (302)594-7272.


 


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Paul, we enthusiastically welcome you to the Hercules management
team.  I look forward to working with you
to make this a personally and professionally rewarding opportunity.


 


To indicate your acceptance
of the above terms please sign a copy of this letter and return it to me within
three days.


 


	
   

  	
   

  	
  Best regards,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Edward V. Carrington

  
	
   

  	
   

  	
  Vice President, Human
  Resources

  
	
   

  	
   

  	
   

  
	
  Accepted by:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Paul C. Raymond III

  	
  Date

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Enclosures

  	
   

  	
   

  
					



 


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