UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE
SECURITIES EXCHANGE ACT OF 1934
February
17, 2009
Date
of Report (Date of earliest event reported)
QUAKER
CHEMICAL CORPORATION
(Exact
name of Registrant as specified in its charter)
Commission
File Number 001-12019
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PENNSYLVANIA
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No.
23-0993790
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(State
or other jurisdiction of
incorporation
or organization)
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(I.R.S.
Employer
Identification
No.)
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One
Quaker Park
901
Hector Street
Conshohocken,
Pennsylvania 19428
(Address
of principal executive offices)
(Zip
Code)
(610)
832-4000
(Registrant’s
telephone number, including area code)
Not
Applicable
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
¨ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨ Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 1.01.
Entry into a Material Definitive Agreement.
Third
Amendment to Syndicated Multicurrency Credit Facility
On February 17, 2009, Quaker Chemical
Corporation (the “Company”) and our wholly owned subsidiaries, Quaker Chemical
Corporation (a Delaware corporation), Epmar Corporation, Quaker Chemical Europe
B.V. and Quaker Chemical B.V., entered into a third amendment to our syndicated
multicurrency credit agreement with Bank of America, N.A., as administrative
agent, swing line lender and letter of credit issuer, and certain other
financial institutions as lenders.
The amendment makes certain adjustments
to the definition of Consolidated EBITDA, which is used in the calculation of
our financial covenants. As amended, the Company is permitted
additional add-backs to Consolidated Net Income (as defined in the credit
agreement), including (i) certain non-cash compensation expenses, (ii) certain
restructuring charges relating to cost savings initiatives such as those
undertaken in fiscal years 2008 and 2009, and (iii) certain chief executive
officer transition costs that have been or will be incurred in fiscal years
2008, 2009 and 2010. The amendment also increases the maximum
permitted consolidated leverage ratio from 3.50 to 1.00 to 4.00 to 1.00 for the
fiscal quarters ending June 30, 2009 and September 30, 2009, and from 3.50 to
1.00 to 3.75 to 1.00 for the fiscal quarters ending December 31, 2009 and March
31, 2010. On a pro-forma basis, the estimated consolidated leverage
ratio as of December 31, 2008 is approximately 2.2.
In addition, the amendment adjusts the
business covenant permitting us to make certain acquisitions and investments to
allow us to enter into those transactions so long as, among other things, the
sum of the aggregate purchase price and the aggregate amount of all such
acquisitions and investments does not exceed (i) $75 million in the aggregate in
total consideration incurred in any fiscal year and (ii) $50 million in the
aggregate in cash consideration paid in any year.
After giving effect to the amendment,
the Company will be paying a spread over LIBOR of 2.25% to 2.75%, with an
initial spread of 2.5%. We continue to be subject to the business and
financial covenants in our credit facility which include an interest coverage
test in addition to the leverage test described above.
Lastly, we amended two tax-exempt loan
facilities ($10 million and $5 million, respectively) to make them consistent
with the loan covenant changes described above in exchange for interest rate
increases on both such facilities.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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QUAKER
CHEMICAL CORPORATION
Registrant
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Date: February
20, 2009
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By:
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/s/
Mark A. Featherstone
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Mark
A. Featherstone
Vice
President and
Chief
Financial Officer
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