x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Pennsylvania
|
23-0993790
|
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
One Quaker Park, 901 E. Hector Street,
Conshohocken, Pennsylvania
|
19428 – 2380
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer
¨
|
Accelerated filer
x
|
|||
Non-accelerated filer
¨
(Do not check if smaller reporting company)
|
Smaller reporting Company
¨
|
Number of Shares of Common Stock
Outstanding on June 30, 2011
|
12,823,294
|
|
|
Page
|
||
PART I.
|
|
FINANCIAL INFORMATION
|
|
|
Item 1.
|
|
Financial Statements (unaudited)
|
|
|
|
|
3
|
||
|
|
4
|
||
|
|
5
|
||
|
|
6
|
||
Item 2.
|
|
|
20
|
|
Item 3.
|
|
|
25
|
|
Item 4.
|
|
|
26
|
|
PART II.
|
|
|
27
|
|
Item 2.
|
27
|
|||
Item 6.
|
|
|
28
|
|
Signatures
|
|
28
|
Unaudited
|
||||||||
(Dollars in thousands,
|
||||||||
except par value
|
||||||||
and share amounts)
|
||||||||
June 30, 2011
|
December 31, 2010*
|
|||||||
ASSETS
|
||||||||
Current assets
|
||||||||
Cash and cash equivalents
|
$
|
23,541
|
$
|
25,766
|
||||
Accounts receivable, net
|
137,402
|
116,266
|
||||||
Inventories
|
||||||||
Raw materials and supplies
|
43,580
|
31,909
|
||||||
Work-in-process and finished goods
|
33,119
|
28,932
|
||||||
Prepaid expenses and other current assets
|
16,032
|
12,609
|
||||||
Total current assets
|
253,674
|
215,482
|
||||||
Property, plant and equipment, at cost
|
218,119
|
205,359
|
||||||
Less accumulated depreciation
|
(138,414)
|
(128,824)
|
||||||
Net property, plant and equipment
|
79,705
|
76,535
|
||||||
Goodwill
|
55,282
|
52,758
|
||||||
Other intangible assets, net
|
23,127
|
24,030
|
||||||
Investments in associated companies
|
9,407
|
9,218
|
||||||
Deferred income taxes
|
25,784
|
28,846
|
||||||
Other assets
|
43,840
|
42,561
|
||||||
Total assets
|
$
|
490,819
|
$
|
449,430
|
||||
LIABILITIES AND EQUITY
|
||||||||
Current liabilities
|
||||||||
Short-term borrowings and current portion of long-term debt
|
$
|
836
|
$
|
890
|
||||
Accounts and other payables
|
79,465
|
63,893
|
||||||
Accrued compensation
|
11,026
|
17,140
|
||||||
Other current liabilities
|
19,808
|
19,268
|
||||||
Total current liabilities
|
111,135
|
101,191
|
||||||
Long-term debt
|
33,628
|
73,855
|
||||||
Deferred income taxes
|
6,817
|
6,108
|
||||||
Other non-current liabilities
|
77,534
|
81,177
|
||||||
Total liabilities
|
229,114
|
262,331
|
||||||
Equity
|
||||||||
Common stock $1 par value; authorized 30,000,000 shares; issued and outstanding
|
||||||||
2011 – 12,823,294 shares; 2010 – 11,492,142 shares
|
12,823
|
11,492
|
||||||
Capital in excess of par value
|
87,249
|
38,275
|
||||||
Retained earnings
|
158,998
|
144,347
|
||||||
Accumulated other comprehensive loss
|
(5,507)
|
(13,736)
|
||||||
Total Quaker shareholders’ equity
|
253,563
|
180,378
|
||||||
Noncontrolling interest
|
8,142
|
6,721
|
||||||
Total equity
|
261,705
|
187,099
|
||||||
Total liabilities and equity
|
$
|
490,819
|
$
|
449,430
|
*
|
Condensed from audited financial statements
|
|
Unaudited
|
Unaudited
|
||||||||||||||
|
(Dollars in thousands,
|
(Dollars in thousands,
|
||||||||||||||
|
except per
|
except per
|
||||||||||||||
|
share and share amounts)
|
share and share amounts)
|
||||||||||||||
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||||
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
Net sales
|
$ | 167,792 | $ | 135,991 | $ | 327,657 | $ | 264,311 | ||||||||
Cost of goods sold
|
114,026 | 87,460 | 221,157 | 168,440 | ||||||||||||
Gross profit
|
53,766 | 48,531 | 106,500 | 95,871 | ||||||||||||
Selling, general and administrative expenses
|
38,825 | 35,118 | 77,459 | 68,787 | ||||||||||||
Operating income
|
14,941 | 13,413 | 29,041 | 27,084 | ||||||||||||
Other income, net
|
791 | 1,123 | 1,330 | 1,886 | ||||||||||||
Interest expense
|
(1,200 | ) | (1,386 | ) | (2,418 | ) | (2,697 | ) | ||||||||
Interest income
|
271 | 343 | 543 | 527 | ||||||||||||
Income before taxes and equity in net income of associated companies
|
14,803 | 13,493 | 28,496 | 26,800 | ||||||||||||
Taxes on income before equity in net income of associated companies
|
4,499 | 4,143 | 7,321 | 7,324 | ||||||||||||
Income before equity in net income of associated companies
|
10,304 | 9,350 | 21,175 | 19,476 | ||||||||||||
Equity in net income of associated companies
|
251 | 384 | 610 | 295 | ||||||||||||
Net income
|
10,555 | 9,734 | 21,785 | 19,771 | ||||||||||||
Less: Net income attributable to noncontrolling interest
|
714 | 581 | 1,344 | 1,199 | ||||||||||||
Net income attributable to Quaker Chemical Corporation
|
$ | 9,841 | $ | 9,153 | $ | 20,441 | $ | 18,572 | ||||||||
Per share data:
|
||||||||||||||||
Net income attributable to Quaker Chemical Corporation Common
|
||||||||||||||||
Shareholders – basic
|
$ | 0.80 | $ | 0.82 | $ | 1.72 | $ | 1.66 | ||||||||
Net income attributable to Quaker Chemical Corporation Common
|
||||||||||||||||
Shareholders – diluted
|
$ | 0.79 | $ | 0.80 | $ | 1.69 | $ | 1.64 | ||||||||
Dividends declared
|
$ | 0.24 | $ | 0.235 | $ | 0.475 | $ | 0.465 | ||||||||
|
Unaudited
|
||||||||
(Dollars in thousands)
|
||||||||
For the Six Months Ended
|
||||||||
June 30,
|
||||||||
2011
|
2010
|
|||||||
Cash flows from operating activities
|
||||||||
Net income
|
$ | 21,785 | $ | 19,771 | ||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation
|
5,405 | 5,068 | ||||||
Amortization
|
973 | 462 | ||||||
Equity in undistributed earnings of associated companies, net of dividends
|
(32 | ) | (233 | ) | ||||
Deferred compensation and other, net
|
4,162 | (357 | ) | |||||
Stock-based compensation
|
1,854 | 1,663 | ||||||
Gain on disposal of property, plant and equipment
|
(78 | ) | (22 | ) | ||||
Insurance settlement realized
|
(864 | ) | (772 | ) | ||||
Pension and other postretirement benefits
|
(4,168 | ) | (2,227 | ) | ||||
Increase (decrease) in cash from changes in current assets and current liabilities, net of acquisitions:
|
||||||||
Accounts receivable
|
(17,392 | ) | (10,645 | ) | ||||
Inventories
|
(13,986 | ) | (7,181 | ) | ||||
Prepaid expenses and other current assets
|
(4,029 | ) | (1,641 | ) | ||||
Accounts payable and accrued liabilities
|
6,537 | 6,409 | ||||||
Net cash provided by operating activities
|
167 | 10,295 | ||||||
Cash flows from investing activities
|
||||||||
Investments in property, plant and equipment
|
(6,641 | ) | (3,468 | ) | ||||
Proceeds from disposition of assets
|
221 | 59 | ||||||
Payments related to acquisitions, net of cash acquired
|
(717 | ) | — | |||||
Insurance settlement received and interest earned
|
42 | 5,070 | ||||||
Change in restricted cash, net
|
822 | (1,940 | ) | |||||
Net cash used in investing activities
|
(6,273 | ) | (279 | ) | ||||
Cash flows from financing activities
|
||||||||
Net increase in short-term borrowings
|
— | 1,263 | ||||||
Repayment of long-term debt
|
(40,402 | ) | (2,614 | ) | ||||
Dividends paid
|
(5,413 | ) | (5,119 | ) | ||||
Stock options exercised, other
|
146 | 1,663 | ||||||
Excess tax benefit related to stock option exercises
|
162 | 1,236 | ||||||
Proceeds from sale of common stock, net of related expenses
|
48,143 | — | ||||||
Net cash provided by (used in) financing activities
|
2,636 | (3,571 | ) | |||||
Effect of exchange rate changes on cash
|
1,245 | (3,890 | ) | |||||
Net (decrease) increase in cash and cash equivalents
|
(2,225 | ) | 2,555 | |||||
Cash and cash equivalents at beginning of period
|
25,766 | 25,051 | ||||||
Cash and cash equivalents at end of period
|
$ | 23,541 | $ | 27,606 | ||||
Supplemental cash flow disclosures:
|
||||||||
Non-cash activities:
|
||||||||
Excess tax benefit related to stock option exercises
|
$ | — | $ | 882 | ||||
Restricted insurance receivable (See also Note 13 of Notes to Condensed Consolidated Financial Statements)
|
— | 5,000 |
|
·
|
Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.
|
|
·
|
Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
|
|
·
|
Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions.
|
Fair Value Measurements at June 30, 2011
|
||||||||||||||||
Fair Value
|
Using Fair Value Hierarchy
|
|||||||||||||||
as of
|
||||||||||||||||
Assets
|
June 30, 2011
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
Company-owned life insurance
|
$ | 1,557 | $ | — | $ | 1,557 | $ | — | ||||||||
Company-owned life insurance - Deferred compensation assets
|
546 | — | 546 | — | ||||||||||||
Other deferred compensation assets
|
||||||||||||||||
Large capitalization registered investment companies
|
69 | 69 | — | — | ||||||||||||
Mid capitalization registered investment companies
|
4 | 4 | — | — | ||||||||||||
Small capitalization registered investment companies
|
8 | 8 | — | — | ||||||||||||
International developed and emerging markets registered investment
|
||||||||||||||||
companies
|
39 | 39 | — | — | ||||||||||||
Fixed income registered investment companies
|
8 | 8 | — | — | ||||||||||||
Total
|
$ | 2,231 | $ | 128 | $ | 2,103 | $ | — |
Fair Value Measurements at June 30, 2011
|
||||||||||||||||
Fair Value
|
Using Fair Value Hierarchy
|
|||||||||||||||
as of
|
||||||||||||||||
Liabilities
|
June 30, 2011
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
Deferred compensation liabilities
|
||||||||||||||||
Large capitalization registered investment companies
|
$ | 341 | $ | 341 | $ | — | $ | — | ||||||||
Mid capitalization registered investment companies
|
89 | 89 | — | — | ||||||||||||
Small capitalization registered investment companies
|
74 | 74 | — | — | ||||||||||||
International developed and emerging markets registered investment
|
||||||||||||||||
companies
|
206 | 206 | — | — | ||||||||||||
Fixed income registered investment companies
|
49 | 49 | — | — | ||||||||||||
Fixed general account
|
173 | — | 173 | — | ||||||||||||
Interest rate derivatives
|
759 | — | 759 | — | ||||||||||||
Acquisition related contingent consideration
|
5,738 | — | — | 5,738 | ||||||||||||
Total
|
$ | 7,429 | $ | 759 | $ | 932 | $ | 5,738 |
Fair Value Measurements at December 31, 2010
|
||||||||||||||||
Fair Value
|
Using Fair Value Hierarchy
|
|||||||||||||||
as of
|
||||||||||||||||
Assets
|
December 31, 2010
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
Company-owned life insurance
|
$ | 2,033 | $ | — | $ | 2,033 | $ | — | ||||||||
Company-owned life insurance - Deferred compensation assets
|
593 | — | 593 | — | ||||||||||||
Other deferred compensation assets
|
||||||||||||||||
Large capitalization registered investment companies
|
69 | 69 | — | — | ||||||||||||
Mid capitalization registered investment companies
|
4 | 4 | — | — | ||||||||||||
Small capitalization registered investment companies
|
8 | 8 | — | — | ||||||||||||
International developed and emerging markets registered investment
|
||||||||||||||||
companies
|
40 | 40 | — | — | ||||||||||||
Fixed income registered investment companies
|
10 | 10 | — | — | ||||||||||||
Total
|
$ | 2,757 | $ | 131 | $ | 2,626 | $ | — |
Fair Value Measurements at December 31, 2010
|
||||||||||||||||
Fair Value
|
Using Fair Value Hierarchy
|
|||||||||||||||
as of
|
||||||||||||||||
Liabilities
|
December 31, 2010
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
Deferred compensation liabilities
|
||||||||||||||||
Large capitalization registered investment companies
|
$ | 347 | $ | 347 | $ | — | $ | — | ||||||||
Mid capitalization registered investment companies
|
88 | 88 | — | — | ||||||||||||
Small capitalization registered investment companies
|
71 | 71 | — | — | ||||||||||||
International developed and emerging markets registered investment
|
||||||||||||||||
companies
|
213 | 213 | — | — | ||||||||||||
Fixed income registered investment companies
|
52 | 52 | — | — | ||||||||||||
Fixed general account
|
182 | — | 182 | — | ||||||||||||
Interest rate derivatives
|
1,026 | — | 1,026 | — | ||||||||||||
Acquisition related contingent consideration
|
5,350 | — | — | 5,350 | ||||||||||||
Total
|
$ | 7,329 | $ | 771 | $ | 1,208 | $ | 5,350 |
Contingent
|
||||
Consideration
|
||||
Balance at December 31, 2010
|
$ | 5,350 | ||
Interest accretion
|
388 | |||
Balance at June 30, 2011
|
$ | 5,738 |
Fair Value
|
|||||||||
June 30,
|
December 31,
|
||||||||
Balance Sheet Location
|
2011
|
2010
|
|||||||
Derivatives designated as cash flow hedges:
|
|||||||||
Interest rate swaps
|
Other non-current liabilities
|
759 | 1,026 | ||||||
$ | 759 | $ | 1,026 |
Cash Flow Hedges
|
|||||||||||||||||
Interest Rate Swaps
|
|||||||||||||||||
Three Months Ended
|
Six Months Ended
|
||||||||||||||||
June 30,
|
June 30,
|
||||||||||||||||
2011
|
2010
|
2011
|
2010
|
||||||||||||||
Amount of Gain (Loss) Recognized in Accumulated OCI on Derivative
|
|||||||||||||||||
(Effective Portion)
|
$ | 78 | $ | 191 | $ | 174 | $ | 296 | |||||||||
Amount and Location of Gain (Loss) Reclassified from Accumulated OCI into
|
|||||||||||||||||
Income (Effective Portion)
|
Interest Expense
|
$ | (165 | ) | $ | (454 | ) | $ | (328 | ) | $ | (908 | ) | ||||
Amount and Location of Gain (Loss) Recognized in Income on Derivative
|
|||||||||||||||||
(Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
Other Income
|
$ | — | $ | — | $ | — | $ | — |
Weighted
|
||||||
Average
|
||||||
Weighted Average
|
Remaining
|
|||||
Number of
|
Exercise Price per
|
Contractual
|
||||
Shares
|
Share
|
Term (years)
|
||||
Balance at December 31, 2010
|
303,444
|
$
|
14.19
|
|||
Options granted
|
36,835
|
37.37
|
||||
Options exercised
|
(10,163)
|
15.40
|
||||
Options forfeited
|
(11,018)
|
13.67
|
||||
Balance at June 30, 2011
|
319,098
|
$
|
16.85
|
4.5
|
||
Exercisable at June 30, 2011
|
163,995
|
$
|
14.48
|
3.6
|
Weighted
|
Weighted
|
Number
|
Weighted
|
||||||||||
Number
|
Average
|
Average
|
Exercisable
|
Average
|
|||||||||
Range of
|
Outstanding
|
Contractual
|
Exercise
|
at
|
Exercise
|
||||||||
Exercise Prices
|
at 6/30/2011
|
Life
|
Price
|
6/30/2011
|
Price
|
||||||||
$
|
3.74
|
-
|
$
|
7.47
|
125,155
|
4.6
|
$
|
6.93
|
74,595
|
$
|
6.93
|
||
$
|
7.48
|
-
|
$
|
18.69
|
—
|
—
|
—
|
—
|
—
|
||||
$
|
18.70
|
-
|
$
|
22.42
|
119,264
|
5.2
|
18.92
|
51,556
|
19.04
|
||||
$
|
22.43
|
-
|
$
|
26.16
|
37,844
|
0.3
|
23.13
|
37,844
|
23.13
|
||||
$
|
26.17
|
-
|
$
|
33.63
|
—
|
—
|
—
|
—
|
—
|
||||
$
|
33.64
|
-
|
$
|
37.37
|
36,835
|
6.7
|
37.37
|
—
|
—
|
||||
319,098
|
4.5
|
16.85
|
163,995
|
14.48
|
2011
|
||||
Dividend Yield
|
5.00
|
%
|
||
Expected Volatility
|
62.13
|
%
|
||
Risk-free interest rate
|
1.99
|
%
|
||
Expected term (years)
|
5.0
|
|||
Expected forfeiture rate
|
3.00
|
%
|
Weighted
|
|||||
Average Grant
|
|||||
Number of
|
Date Fair Value
|
||||
Shares
|
(per share)
|
||||
Nonvested awards, December 31, 2010
|
63,250
|
$
|
7.72
|
||
Granted
|
—
|
$
|
—
|
||
Vested
|
—
|
$
|
—
|
||
Forfeited
|
(500)
|
$
|
7.72
|
||
Nonvested awards, June 30, 2011
|
62,750
|
$
|
7.72
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Basic Earnings per Common Share
|
||||||||||||||||
Net income attributable to Quaker Chemical Corporation
|
$ | 9,841 | $ | 9,153 | $ | 20,441 | $ | 18,572 | ||||||||
Less: income allocated to participating securities
|
(182 | ) | (196 | ) | (384 | ) | (399 | ) | ||||||||
Net income available to common shareholders
|
$ | 9,659 | $ | 8,957 | $ | 20,057 | $ | 18,173 | ||||||||
Basic weighted average common shares outstanding
|
12,043,858 | 10,973,547 | 11,668,657 | 10,926,647 | ||||||||||||
Basic earnings per common share
|
$ | 0.80 | $ | 0.82 | $ | 1.72 | $ | 1.66 | ||||||||
Diluted Earnings per Common Share
|
||||||||||||||||
Net income attributable to Quaker Chemical Corporation
|
$ | 9,841 | $ | 9,153 | $ | 20,441 | $ | 18,572 | ||||||||
Less: income allocated to participating securities
|
(180 | ) | (194 | ) | (380 | ) | (394 | ) | ||||||||
Net income available to common shareholders
|
$ | 9,661 | $ | 8,959 | $ | 20,061 | $ | 18,178 | ||||||||
Basic weighted average common shares outstanding
|
12,043,858 | 10,973,547 | 11,668,657 | 10,926,647 | ||||||||||||
Effect of dilutive securities, common shares outstanding
|
174,919 | 203,417 | 175,905 | 158,314 | ||||||||||||
Diluted weighted average common shares outstanding
|
12,218,777 | 11,176,964 | 11,844,562 | 11,084,961 | ||||||||||||
Diluted earnings per common share
|
$ | 0.79 | $ | 0.80 | $ | 1.69 | $ | 1.64 |
|
|
|
|
Accumulated
|
|
|
|
|||||||||||||||||||||
|
|
Capital in
|
|
Other
|
|
|
|
|||||||||||||||||||||
|
Common
|
Excess of
|
Retained
|
Comprehensive
|
Noncontrolling
|
Comprehensive
|
|
|||||||||||||||||||||
|
Stock
|
Par Value
|
Earnings
|
Income (Loss)
|
Interest
|
Income
|
Total
|
|||||||||||||||||||||
Balance at March 31, 2011
|
$ | 11,531 | $ | 39,132 | $ | 152,237 | $ | (9,497 | ) | $ | 7,359 |
|
$ | 200,762 | ||||||||||||||
Net income
|
— | — | 9,841 | 714 | $ | 10,555 | ||||||||||||||||||||||
Currency translation adjustments
|
— | — | — | 3,587 | 69 | 3,656 | ||||||||||||||||||||||
Defined benefit retirement plans
|
— | — | — | 325 | — | 325 | ||||||||||||||||||||||
Current period changes in fair value of derivatives
|
— | — | — | 78 | — | 78 | ||||||||||||||||||||||
Unrealized gain on available-for-sale securities
|
— | — | — | — | — | — | ||||||||||||||||||||||
Comprehensive income
|
14,614 | 14,614 | ||||||||||||||||||||||||||
Comprehensive loss attributable to
|
||||||||||||||||||||||||||||
noncontrolling interest
|
(783 | ) | ||||||||||||||||||||||||||
Comprehensive income attributable to
|
||||||||||||||||||||||||||||
Quaker Chemical Corporation
|
$ | 13,831 | ||||||||||||||||||||||||||
Dividends ($0.235 per share)
|
— | — | (3,080 | ) | — | — | (3,080 | ) | ||||||||||||||||||||
Stock offering, net of related expenses
|
1,265 | 46,878 | — | — | — | 48,143 | ||||||||||||||||||||||
Share issuance and equity-based compensation plans
|
27 | 1,155 | — | — | — | 1,182 | ||||||||||||||||||||||
Excess tax benefit from stock option exercises
|
— | 84 | — | — | — | 84 | ||||||||||||||||||||||
Balance at June 30, 2011
|
$ | 12,823 | $ | 87,249 | $ | 158,998 | $ | (5,507 | ) | $ | 8,142 | $ | 261,705 | |||||||||||||||
|
||||||||||||||||||||||||||||
Balance at March 31, 2010
|
$ | 11,152 | $ | 30,277 | $ | 129,994 | $ | (14,058 | ) | $ | 5,750 | $ | 163,115 | |||||||||||||||
Net income
|
— | — | 9,153 | 581 | $ | 9,734 | ||||||||||||||||||||||
Currency translation adjustments
|
— | — | — | (6,458 | ) | (268 | ) | (6,726 | ) | |||||||||||||||||||
Defined benefit retirement plans
|
— | — | — | 269 | — | 269 | ||||||||||||||||||||||
Current period changes in fair value of derivatives
|
— | — | — | 191 | — | 191 | ||||||||||||||||||||||
Unrealized loss on available-for-sale securities
|
— | — | — | (14 | ) | — | (14 | ) | ||||||||||||||||||||
Comprehensive income
|
3,454 | 3,454 | ||||||||||||||||||||||||||
Comprehensive loss attributable to
|
||||||||||||||||||||||||||||
noncontrolling interest
|
(313 | ) | ||||||||||||||||||||||||||
Comprehensive income attributable to
|
||||||||||||||||||||||||||||
Quaker Chemical Corporation
|
$ | 3,141 | ||||||||||||||||||||||||||
Dividends ($0.235 per share)
|
— | — | (2,650 | ) | — | — | (2,650 | ) | ||||||||||||||||||||
Share issuance and equity-based compensation plans
|
107 | 2,357 | — | — | — | 2,464 | ||||||||||||||||||||||
Excess tax benefit from stock option exercises
|
— | 164 | — | — | — | 164 | ||||||||||||||||||||||
Balance at June 30, 2010
|
$ | 11,259 | $ | 32,798 | $ | 136,497 | $ | (20,070 | ) | $ | 6,063 | $ | 166,547 |
|
|
|
|
Accumulated
|
|
|
|
|||||||||||||||||||||
|
|
Capital in
|
|
Other
|
|
|
|
|||||||||||||||||||||
|
Common
|
Excess of
|
Retained
|
Comprehensive
|
Noncontrolling
|
Comprehensive
|
|
|||||||||||||||||||||
|
Stock
|
Par Value
|
Earnings
|
Income (Loss)
|
Interest
|
Income
|
Total
|
|||||||||||||||||||||
Balance at December 31, 2010
|
$ | 11,492 | $ | 38,275 | $ | 144,347 | $ | (13,736 | ) | $ | 6,721 |
|
$ | 187,099 | ||||||||||||||
Net income
|
— | — | 20,441 | — | 1,344 | $ | 21,785 | |||||||||||||||||||||
Currency translation adjustments
|
— | — | — | 7,400 | 77 | 7,477 | ||||||||||||||||||||||
Defined benefit retirement plans
|
— | — | — | 649 | — | 649 | ||||||||||||||||||||||
Current period changes in fair value of derivatives
|
— | — | — | 174 | — | 174 | ||||||||||||||||||||||
Unrealized gain on available-for-sale securities
|
— | — | — | 6 | — | 6 | ||||||||||||||||||||||
Comprehensive income
|
30,091 | 30,091 | ||||||||||||||||||||||||||
Comprehensive loss attributable to
|
||||||||||||||||||||||||||||
noncontrolling interest
|
(1,421 | ) | ||||||||||||||||||||||||||
Comprehensive income attributable to
|
||||||||||||||||||||||||||||
Quaker Chemical Corporation
|
$ | 28,670 | ||||||||||||||||||||||||||
Dividends ($0.47 per share)
|
— | — | (5,790 | ) | — | — | (5,790 | ) | ||||||||||||||||||||
Stock offering, net of related expenses
|
1,265 | 46,878 | — | — | — | 48,143 | ||||||||||||||||||||||
Share issuance and equity-based compensation plans
|
66 | 1,934 | — | — | — | 2,000 | ||||||||||||||||||||||
Excess tax benefit from stock option exercises
|
— | 162 | — | — | — | 162 | ||||||||||||||||||||||
Balance at June 30, 2011
|
$ | 12,823 | $ | 87,249 | $ | 158,998 | $ | (5,507 | ) | $ | 8,142 | $ | 261,705 | |||||||||||||||
|
||||||||||||||||||||||||||||
Balance at December 31, 2009
|
$ | 11,086 | $ | 27,527 | $ | 123,140 | $ | (10,439 | ) | $ | 4,981 | $ | 156,295 | |||||||||||||||
Net income
|
— | — | 18,572 | 1,199 | $ | 19,771 | ||||||||||||||||||||||
Currency translation adjustments
|
— | — | — | (10,456 | ) | (117 | ) | (10,573 | ) | |||||||||||||||||||
Defined benefit retirement plans
|
— | — | — | 538 | — | 538 | ||||||||||||||||||||||
Current period changes in fair value of derivatives
|
— | — | — | 296 | — | 296 | ||||||||||||||||||||||
Unrealized loss on available-for-sale securities
|
— | — | — | (9 | ) | — | (9 | ) | ||||||||||||||||||||
Comprehensive income
|
10,023 | 10,023 | ||||||||||||||||||||||||||
Comprehensive loss attributable to
|
||||||||||||||||||||||||||||
noncontrolling interest
|
(1,082 | ) | ||||||||||||||||||||||||||
Comprehensive income attributable to
|
||||||||||||||||||||||||||||
Quaker Chemical Corporation
|
$ | 8,941 | ||||||||||||||||||||||||||
Dividends ($0.465 per share)
|
— | — | (5,215 | ) | — | — | (5,215 | ) | ||||||||||||||||||||
Share issuance and equity-based compensation plans
|
173 | 3,153 | — | — | — | 3,326 | ||||||||||||||||||||||
Excess tax benefit from stock option exercises
|
— | 2,118 | — | — | — | 2,118 | ||||||||||||||||||||||
Balance at June 30, 2010
|
$ | 11,259 | $ | 32,798 | $ | 136,497 | $ | (20,070 | ) | $ | 6,063 | $ | 166,547 |
D.A.
|
Summit
|
|||||||||||
Stuart
|
Lubricants
|
Total
|
||||||||||
Current assets
|
$ | 1,176 | $ | 6,198 | $ | 7,374 | ||||||
Fixed assets
|
133 | 9,430 | 9,563 | |||||||||
Intangibles
|
2,351 | 17,100 | 19,451 | |||||||||
Goodwill
|
3,133 | 3,804 | 6,937 | |||||||||
Total assets
|
6,793 | 36,532 | 43,325 | |||||||||
Current liabilities
|
— | (1,349 | ) | (1,349 | ) | |||||||
Earnout
|
— | (5,350 | ) | (5,350 | ) | |||||||
Total liabilities assumed
|
— | (6,699 | ) | (6,699 | ) | |||||||
Cash paid
|
$ | 6,793 | $ | 29,833 | $ | 36,626 |
Metalworking
|
||||||||||||
Process
|
||||||||||||
Chemicals
|
Coatings
|
Total
|
||||||||||
Balance as of December 31, 2010
|
$ | 44,677 | $ | 8,081 | $ | 52,758 | ||||||
Goodwill additions
|
717 | — | 717 | |||||||||
Currency translation adjustments
|
1,807 | — | 1,807 | |||||||||
Balance as of June 30, 2011
|
$ | 47,201 | $ | 8,081 | $ | 55,282 |
Gross Carrying
|
Accumulated
|
|||||||||||||||
Amount
|
Amortization
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Amortized intangible assets
|
||||||||||||||||
Customer lists and rights to sell
|
$ | 24,563 | $ | 24,379 | $ | 5,777 | $ | 4,974 | ||||||||
Trademarks and patents
|
2,035 | 2,035 | 1,813 | 1,800 | ||||||||||||
Formulations and product technology
|
5,278 | 5,278 | 2,899 | 2,708 | ||||||||||||
Other
|
4,009 | 4,004 | 3,369 | 3,284 | ||||||||||||
Total
|
$ | 35,885 | $ | 35,696 | $ | 13,858 | $ | 12,766 |
For the year ended December 31, 2011
|
$ | 1,942 | ||
For the year ended December 31, 2012
|
$ | 1,843 | ||
For the year ended December 31, 2013
|
$ | 1,662 | ||
For the year ended December 31, 2014
|
$ | 1,426 | ||
For the year ended December 31, 2015
|
$ | 1,426 | ||
For the year ended December 31, 2016
|
$ | 1,253 |
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||||||||||||||||||
Other
|
Other
|
|||||||||||||||||||||||||||||||
Postretirement
|
Postretirement
|
|||||||||||||||||||||||||||||||
Pension Benefits
|
Benefits
|
Pension Benefits
|
Benefits
|
|||||||||||||||||||||||||||||
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
|||||||||||||||||||||||||
Service cost
|
$ | 593 | $ | 480 | $ | 5 | $ | 5 | $ | 1,164 | $ | 991 | $ | 10 | $ | 9 | ||||||||||||||||
Interest cost and other
|
1,555 | 1,482 | 89 | 98 | 3,077 | 3,012 | 178 | 197 | ||||||||||||||||||||||||
Expected return on plan assets
|
(1,449 | ) | (1,344 | ) | — | — | (2,873 | ) | (2,728 | ) | — | — | ||||||||||||||||||||
Other amortization, net
|
461 | 402 | 31 | 13 | 921 | 804 | 62 | 26 | ||||||||||||||||||||||||
Net periodic benefit cost
|
$ | 1,160 | $ | 1,020 | $ | 125 | $ | 116 | $ | 2,289 | $ | 2,079 | $ | 250 | $ | 232 |
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
|
·
|
statements relating to our business strategy;
|
|
·
|
our current and future results and plans; and
|
|
·
|
statements that include the words “may,” “could,” “should,” “would,” “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan” or similar expressions.
|
Quantitative and Qualitative Disclosures About Market Risk.
|
Item 4
.
|
Controls and Procedures.
|
(c)
|
(d)
|
|||||||||||||||
Total Number of
|
Maximum
|
|||||||||||||||
Shares Purchased as
|
Number of Shares that
|
|||||||||||||||
(a)
|
(b)
|
Part of
|
May Yet
|
|||||||||||||
Total Number
|
Average
|
Publicly Announced
|
Be Purchased Under the
|
|||||||||||||
of Shares
|
Price Paid
|
Plans
|
Plans or
|
|||||||||||||
Period
|
Purchased (1)
|
Per Share (2)
|
or Programs (3)
|
Programs (3)
|
||||||||||||
April 1 - April 30
|
— | $ | — | — | 252,600 | |||||||||||
May 1 - May 31
|
— | $ | — | — | 252,600 | |||||||||||
June 1 - June 30
|
573 | $ | 40.91 | — | 252,600 | |||||||||||
Total
|
573 | $ | 40.91 | — | 252,600 |
(1)
|
All of the 573
shares acquired by the Company during the period covered by this report were acquired from employees upon their surrender of previously owned shares in payment of taxes upon vesting of restricted stock.
|
(2)
|
The price per share represented the closing price of the Company’s common stock on the date of vesting, as specified by the plan pursuant to which the restricted stock was granted.
|
(3)
|
On February 15, 1995, the Board of Directors of the Company authorized a share repurchase program authorizing the repurchase of up to 500,000 shares of Quaker common stock, and, on January 26, 2005, the Board authorized the repurchase of up to an additional 225,000 shares. Under the 1995 action of the Board, 27,600 shares may yet be purchased. Under the 2005 action of the Board, none of the shares authorized have been purchased and, accordingly, all of those shares may yet be purchased. Neither of the share repurchase authorizations has an expiration date.
|
Exhibits
|
*
|
This exhibit is a management contract or compensation plan or arrangement required to be filed as an exhibit.
|
** | Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 and are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability under these sections. |
QUAKER CHEMICAL CORPORATION
(Registrant)
|
||||
/s/ Mark A. Featherstone
|
||||
Date: July 27, 2011
|
Mark A. Featherstone, officer duly authorized to sign this report, Vice President, Chief Financial Officer and Treasurer
|
1.0
|
Appointment.
|
1.1
|
Effective as of the date written above QUAKER agrees to employ EXECUTIVE, and EXECUTIVE agrees to serve as QUAKER’s Vice President - Global Steel. He shall perform all duties consistent with such position as well as any other duties that are assigned to him from time to time by the Chairman, Chief Executive Officer and President or the Board of Directors of Quaker Chemical Corporation. EXECUTIVE covenants and agrees that he will, during the term of this Employment Agreement or any extension or renewal thereof, devote his knowledge, skill, and working time solely and exclusively to the business and interests of QUAKER.
|
1.2
|
Since EXECUTIVE’s new position is with QUAKER, EXECUTIVE’s RIM contract dated February 21, 2001; and the confirmation letter dated February 21, 2006 are hereby terminated as of June 14, 2011, and have no continuing legal effect other than recognizing years of service (as of September first,
1991 for any applicable benefits to be extended pursuant to this Agreement.
|
2.0
|
Term.
|
|
2.1
|
Except as otherwise provided for in Paragraph 6, the term of EXECUTIVE’s employment shall continue for an indefinite period of time. The employment may be terminated by either party with due observance of a 12 months notice period. Notice may only be given in writing.
|
3.0
|
Compensation and Benefits.
|
|
3.1
|
EXECUTIVE’s annual base salary will amount to Є
198, 442.20 gross (subject to applicable withholding) as per September 1, 2011,
which will be paid in 12 monthly installments of Є
16, 536.85 gross (subject to applicable withholding). The rate of base salary will be reviewed and adjusted on an annual basis consistent with QUAKER’S then current practice for reviewing executive officers’ salaries and performance.
|
|
3.2
|
EXECUTIVE will be entitled to an annual incentive bonus package to be established at 0 up to a maximum of 50% of base annual salary (annual salary defined as monthly gross salary x 12) in accordance with the Quaker Chemical Corporation’s Global Annual Incentive Plan. Under the Quaker Chemical Corporation’s Long-Term Incentive Plan, EXECUTIVE will participate at Level 1 with the awards to be annually approved by the Compensation and Management Development Committee of the Board of Directors of Quaker Chemical Corporation. Both of the aforementioned incentive Plans may be amended by the Board of Directors at any time including eligibility to participate in any given QUAKER (and/or its affiliate’s) incentive plan, the level of participation in any QUAKER (and/or its affiliate’s) incentive plan, and the terms and conditions of any QUAKER (and/or its affiliate’s) incentive plan.
Any changes to those Plans, including participation levels shall not affect any of the other terms and conditions hereof including, without limitation, the convenants contained in the Declaration of Secrecy and Non-Competition attached as Addendum 1. Revisions to Addendum 1 shall become effective upon notification in writing by QUAKER.
|
|
3.3
|
Pursuant to the express terms of the Employment Agreement (and this summary of the general terms of employment), EXECUTIVE shall be responsible for the payment of all withholding taxes, social security payments, and other applicable governmental taxes, charges, or payments.
|
|
3.5
|
EXECUTIVE will be eligible for a contribution for pensions in the annual amount of Euro 16,930.- This amount will be indexed for inflation every year.
|
|
4.0
|
Insurance and additional arrangements.
|
|
4.1
|
EXECUTIVE shall be entitled to Business Travel Accident Insurance made available to all employees of QUAKER in case of accident while traveling on company business. The principal sum of Accidental Death and Dismemberment Insurance is five (5) times base salary up to a maximum $1,000,000. Apart from this there is a "24 hour Collective Accident/Disability Insurance" that provides coverage for all employees equal to a maximum of three times the yearly income (basic salary plus holiday allowance and 10% bonus). Both policies contain certain exclusions. Luggage of employees traveling abroad (world coverage) is insured to a maximum of
€ 2269. -- per occasion split up into; Luggage: Є 1815. -- with a maximum of 25% = Є 454. -- for high value items (camera, jewelry, etc.) and Cash: Є 454 in excess of Є 45 which is Executive’s own risk, -- per occasion. QUAKER pays the premium.
|
|
4.2
|
EXECUTIVE will continue to be eligible to receive Quaker contributions for Health Insurance in accordance with your current agreement. This amount is adjusted annually by German government.
|
|
4.3
|
In case of illness of the wife/life partner of an employee or in case of illness of a single employee with children, QUAKER will contribute 50% of the costs of a professional who will take over the normal care of the family under certain conditions.
|
5.0
|
Confidentiality and Non-Compete.
|
5.1
|
The duties and nature of the position of EXECUTIVE will necessitate full and detailed access to QUAKER’s and its affiliates’ strategic, financial, operational and technical information. In view thereof, EXECUTIVE, has agreed to sign the Declaration of Secrecy and Non-Competition, attached hereto as Addendum 1 and made a part hereof.
|
5.2
|
In the event that QUAKER in its sole discretion and at any time terminates this Agreement with EXECUTIVE (other than for Termination for Cause, death, disability, or normal retirement age), QUAKER agrees to provide EXECUTIVE with reasonable out-placement assistance and a severance payment (contingent upon EXECUTIVE executing a form of release satisfactory to QUAKER) that shall be in accordance with German legal practice but with a minimum of twelve (12) months’ base salary calculated at EXECUTIVE’s then current rate.
|
5.3
|
This Employment Agreement also can be terminated (and thereby terminate EXECUTIVE's employment with QUAKER) at any time and without notice by “Termination for Cause." Termination for Cause means EXECUTIVE’s employment with QUAKER shall have been terminated by QUAKER by reason of either:
|
5.3.1
|
The willful and continued failure (following written notice/ documentation in writing) by EXECUTIVE to execute his duties under this Employment Agreement; or
|
5.3.2
|
The willful engaging by EXECUTIVE in a continued course of misconduct which is materially injurious to QUAKER, monetarily or otherwise.
|
6.0
|
Representations and Warranties.
|
6.1
|
EXECUTIVE represents and warrants to QUAKER that:
|
6.1.1
|
There are no restrictions, agreements, or understandings whatsoever to which EXECUTIVE is a party which would prevent or make unlawful his execution of this Employment Agreement or his employment hereunder; and
|
6.1.2
|
His execution of this Employment Agreement and his employment hereunder shall not constitute a breach of any contract agreement, or understanding, oral or written, to which he is a party or by which he is bound.
|
7.0
|
Liability
|
8.0
|
Miscellaneous
.
|
8.1
|
This Employment Agreement together with the Addenda hereto contains all the agreements and understandings between the parties hereto with respect to EXECUTIVE’s employment by QUAKER and supersedes all prior or contemporaneous agreements with respect thereto and shall be binding upon and for the benefit of the parties hereto and their respective personal representatives, successors, and assigns. This Employment Agreement with the inclusion of all Addenda hereto, shall be governed by and construed in accordance with the laws of the Netherlands.
|
a)
|
directly or indirectly, together or separately or with any third party, whether as an individual proprietor, partner, stockholder, officer, director, joint venturer, investor, or in any other capacity whatsoever actively engage in business or assist anyone or any firm in business as a manufacturer, seller, or distributor of chemical specialty products or chemical management services which are the same, like, similar to, or which compete with the products and services offered by the Company (or any of its affiliates); and
|
b)
|
recruit or solicit any Associate of the Company (or any affiliate) or otherwise induce such associate to leave the employ of the Company (or any affiliate, as the case may be) or to become an associate or otherwise associated with his or any firm, corporation, business, or other entity with which the associate is or may become associated.
|
(i)
|
The Company or its affiliates without Cause (as defined below); or
|
(ii)
|
Resignation of the Manager for Good Reason (as defined below).
|
(i)
|
An amount equivalent to the highest annualized base salary which the Manager was entitled to receive from the Company and its subsidiaries at any time during his employment prior to the Covered Termination; and
|
(ii)
|
An amount equal to the average of the aggregate annual amounts paid to the Manager in the Applicable Three-Year Period under all applicable annual incentive compensation plans maintained by the Company and its affiliates (other than compensation relating to relocation expense; the grant, exercise, or settlement of stock options, restricted stock or performance incentive units or the sale or other disposition of shares received upon exercise or settlement of such awards); provided, however,
|
(iii)
|
that (x) in determining the average amount paid under the annual incentive plan during the Applicable Three-Year Period there shall be excluded any year in which no amounts were paid to the Manager under that plan; and (y) there shall be excluded from such calculation any amounts paid to the Manager under any such incentive compensation plan as a result of the acceleration of such payments under such plan due to termination of the plan, a Change in Control, or a similar occurrence. The Applicable Three-Year Period shall be (A) if the Manager has received an annual incentive compensation plan payment in the calendar year of his Covered Termination, the calendar year in which such Covered Termination occurs and the two preceding calendar years, or (B) in any other case, the three calendar years preceding the calendar year in which the Manager’s Covered Termination occurs; provided, however, that the Applicable Three-Year Period shall be determined by substituting “Change In Control” for “Covered Termination” if such substitution results in a higher amount under this subsection (ii).
|
(i)
|
The Manager agrees that at no time during or following his employment with the Company will he use, divulge, or pass on, directly or through any other individual or entity, any Trade Secrets.
|
(ii)
|
Upon termination of the Manager’s employment with the Company regardless of the reason for the termination of the Manager’s employment hereunder, or at any other time upon the Company’s request, the Manager agrees to forthwith surrender to the Company any and all materials in his possession or control which constitute or contain any Proprietary Business Information.
|
(i)
|
directly or indirectly, together or separately or with any third party, whether as an individual proprietor, partner, stockholder, officer, director, joint venturer, investor, or in any other capacity whatsoever actively engage in business or assist anyone or any firm in business as a manufacturer, seller, or distributor of specialty chemical products or chemical management services which are the same, like, similar to, or which compete with the products and services offered by the Company (or any of its affiliates);
|
(ii)
|
directly or indirectly recruit, solicit or encourage any employee of the Company (or any of its affiliates) or otherwise induce such employee to leave the employ of the Company (or any of its affiliates) or to become an employee or otherwise be associated with his or any firm, corporation, business or other entity with which he is or may become associated; or
|
(iii)
|
solicit, directly or indirectly, for himself or as agent or employee of any person, partnership, corporation, or other entity (other than for the Company), any then or former customer, supplier, or client of the Company with the intent of actively engaging in business which would cause competitive harm to the Company (or any of its affiliates).
|
(i)
|
the term “Parachute Payment” shall mean a payment described in Section 280G(b)(2)(A) or Section 280G(b)(2)(B) of the Code (including, but not limited to, any stock option rights, stock grants, and other cash and noncash compensation amounts that are treated as payments under either such section) and not excluded under Section 280G(b)(4)(A) or Section 280G(b)(6) of the Code;
|
(ii)
|
the term “Reasonable Compensation” shall mean reasonable compensation for prior personal services as defined in Section 280G(b)(4)(B) of the Code and subject to the requirement that any such reasonable compensation must be established by clear and convincing evidence; and
|
(iii)
|
the portion of the “Base Amount” and the amount of “Reasonable Compensation” allocable to any “Parachute Payment” shall be determined in accordance with Section 280G(b)(3) and (4) of the Code.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Quaker Chemical Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Michael F. Barry
|
Michael F. Barry
|
Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Quaker Chemical Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Mark A. Featherstone
|
Mark A. Featherstone
|
Chief Financial Officer
|
Dated: July 27, 2011
|
/s/ Michael F. Barry
|
|
Michael F. Barry
|
||
Chief Executive Officer of Quaker Chemical Corporation
|
Dated: July 27, 2011
|
/s/ Mark A. Featherstone
|
|
Mark A. Featherstone
|
||
Chief Financial Officer of Quaker Chemical Corporation
|