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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 28, 1994
REGISTRATION NO. 33-54158
=============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
POST-EFFECTIVE AMENDMENT NO. 2
TO
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------
QUAKER CHEMICAL CORPORATION
(EXACT NAME OF ISSUER AS SPECIFIED IN ITS CHARTER)
PENNSYLVANIA 23-0993790
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
ELM AND LEE STREETS, CONSHOHOCKEN, PENNSYLVANIA 19428
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
QUAKER CHEMICAL CORPORATION PROFIT
SHARING AND RETIREMENT SAVINGS PLAN
(FULL TITLE OF THE PLAN)
KARL H. SPAETH, ELM AND LEE STREETS
CONSHOHOCKEN, PENNSYLVANIA 19429
(NAME AND ADDRESS OF AGENT FOR SERVICE)
(610) 832-4112
(TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
Copy to:
Howell J. Reeves, Esquire
Fox, Rothschild, O'Brien & Frankel
2000 Market Street, Tenth Floor
Philadelphia, PA 19103
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QUAKER CHEMICAL CORPORATION
CROSS-REFERENCE SHEET
PURSUANT TO RULE 404 AND ITEM 501 OF REGULATION S-K
FORM S-8 ITEM NO. HEADING IN PROSPECTUS
- ----------------- ---------------------
1. Plan Information
(a) General Plan Information..... Cover Page; General Information;
Definitions; The Plan--General;
The Plan--Purpose; The Plan--Amendment
and Termination; The Plan--
Administration; The Plan--Description of
Investment Options; Applicable
Requirements of ERISA; Reports of the
Company; Incorporation of Certain
Documents by Reference
(b) Securities to be Offered..... Cover Page
(c) Employees Who May Participate
in the Plan.................. Definitions; The Plan--Eligibility
(d) Purchase of Securities Pursuant
to the Plan and Payments for
Securities Offered........... The Plan--Contributions; The Plan--
Limitations on Contributions; The Plan--
Change of Contributions; The Plan--
Accounts; The Plan--Investment of
Contributions
(e) Resale Restrictions.......... The Plan--Assignment; Liens
(f) Tax Effects of Plan
Participation................ Federal Tax Aspects
(g) Investment of Funds.......... The Plan--Investment of Contributions
(h) Withdrawal from the Plan;
Assignment of Interest....... The Plan--Withdrawals of Profit-Sharing
Contributions; The Plan--Distribution of
Benefits; The Plan--Assignment; Liens;
The Plan--Change of Contributions
(i) Forfeitures and Penalties..... The Plan--Contributions,--Limitations
on Contributions and--Investment of
Contributions
(j) Charges and Deductions and
Liens Therefor............... The Plan--Investment of Contributions
2. Registrant Information and
Employee Plan Annual Information. Reports of the Company; Incorporation
of Certain Documents by Reference
PROSPECTUS
- ----------
QUAKER CHEMICAL CORPORATION
100,000 Shares
of
Common Stock
($1 Par Value)
--------------
QUAKER CHEMICAL CORPORATION
PROFIT SHARING AND RETIREMENT SAVINGS PLAN
--------------
This Prospectus covers interests in the Quaker Chemical Corporation
Profit Sharing and Retirement Savings Plan (the "Plan") as well as 100,000
shares of Common Stock, $1 par value, of Quaker Chemical Corporation (the
"Company") which may be acquired pursuant to the Plan as more fully set forth
herein.
None of the Company's Common Stock purchased pursuant to the Plan will be
purchased from the Company. Accordingly, the Company will not receive any
proceeds on account of any purchase of its Common Stock pursuant to the Plan.
See "The Plan--Description of Investment Options."
--------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRE-
SENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
--------------
The date of this Prospectus is October 28, 1994.
ADDITIONAL INFORMATION
The Company has filed a Registration Statement with the Securities and
Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended, with respect to the shares offered hereby. This Prospectus does not
contain all of the information set forth in the Registration Statement,
certain items of which are contained in schedules and exhibits to the
Registration Statement as permitted by the rules and regulations of the
Commission. For further information, reference is made to the Registration
Statement, including the financial schedules and exhibits filed or
incorporated as a part thereof. Items of information omitted from this
Prospectus but contained in the Registration Statement may be inspected and
copies may be obtained (at prescribed rates) at the Commission's Public
Reference Section at 450 Fifth Street, N.W., Washington, D.C. 20549.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 and, in accordance therewith, files reports,
proxy statements and other information with the Commission. Such reports,
proxy statements and other information can be inspected and copied (at
prescribed rates) at the Public Reference Section offices of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's
regional offices at Northwestern Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511; and Seven World Trade Center, 13th Floor,
New York, New York 10048.
No person is authorized to give any information or to make any
representations not contained in this Prospectus in connection with the offer
described herein, and any information or representation not contained herein
must not be relied upon as having been authorized by the Company. This
Prospectus does not constitute an offer to sell these securities in any state
to any person to whom it is unlawful to make such offer in such state.
Neither the delivery of this Prospectus nor any sale made hereunder shall,
under any circumstances, create an implication that information herein is
correct as of any time subsequent to its date.
GENERAL INFORMATION
This Prospectus relates to interests in the Quaker Chemical Corporation
Profit Sharing and Retirement Savings Plan of Quaker Chemical Corporation and
its participating subsidiaries, and to shares of the Company's Common Stock,
$1 par value ("Common Stock"), which may be purchased by the Trustee pursuant
to the Plan. The Company is a Pennsylvania corporation having its principal
executive offices located at Elm and Lee Streets, Conshohocken, Pennsylvania
19428 (telephone number 610-832-4000). The principal provisions of the Plan
are summarized in this Prospectus.
2
DEFINITIONS
The following terms, as used in this Prospectus, have the following
meanings:
"Account" means, with respect to each Participant, the accounts
established and maintained by the Administrator for such Participant pursuant
to the Plan, and to which all contributions on behalf of such Participant are
credited in accordance with the provisions of the Plan.
"Act" means the Employee Retirement Income Security Act of 1974, as it
may be amended from time to time.
"Administrator" means the committee designated by the Employer to
administer the Plan on behalf of the Employer.
"Anniversary Date" means the last day of each Plan Year or such other
date(s) designated as such by the Administrator.
"Base Compensation" with respect to any Employee means the Compensation
of the Employee, excluding overtime payments, bonuses, shift differential,
commissions, all non-salary and non-wage direct or indirect compensation,
Employer contributions to Social Security, contributions to this or any other
retirement plan or programs, salary reduction contributions made on behalf of
such Employee to a plan maintained under Code Section 125, the value of any
other fringe benefit provided by or at the expense of the Employer, or any
income realized upon the receipt or exercise of a grant of a Stock Option,
Stock Appreciation Right, or Performance Incentive Unit pursuant to the Quaker
Chemical Corporation Long-Term Performance Incentive Plan.
"Beneficiary" means the person to whom the share of a deceased
Participant's Account is payable, subject to certain restrictions.
"Code" means the Internal Revenue Code of 1986, as amended or replaced
from time to time.
"Compensation" with respect to any Employee means the total remuneration
earned to or accrued on behalf of the Employee during the time period to which
reference is made exclusive of Compensation paid to any Participant after the
date on which such Participant ceased to be employed in a classification
eligible for participation in this Plan. Only Compensation earned by an
Employee while a Participant will be considered for purposes of determining
the Employer's Profit Sharing Contribution and the allocation of the
Employer's Profit Sharing Contribution made under the Plan.
The determination of Compensation shall also be made by including salary
reduction contributions made on behalf of an Employee to a plan maintained
under Code Section 125.
Compensation in excess of $150,000 shall be disregarded. Such amount
shall be adjusted at the same time and in such manner as permitted under Code
Section 415(d). In applying these limitations, the family group of a Highly
Compensated Participant who is subject to the Family Member aggregation rules
of Code Section 414(q)(6) because such Participant is either a "five percent
owner" of the Employer or one of the ten (10) Highly Compensated Employees
paid the greatest "415 Compensation" during the year, shall be treated as a
single Participant, except that for this purpose Family Members shall include
only the affected Participant's spouse and any lineal descendants who have not
attained age nineteen (19) before the close of the year. If, as a result of
the application of such rules the adjusted dollar limitation is exceeded, then
the limitation shall be prorated among the affected Family Members in
proportion to each such Family Member's Compensation prior to the application
of this limitation.
"Contract" means the Group Annuity Contract No. GA 83729, effective as
of December 30, 1988, between Principal Mutual Life Insurance Company
(formerly Bankers Life) and the Company.
"Deferred Compensation" with respect to any Participant means that
portion of the Participant's total Compensation which has been contributed to
the Plan as an Elective Contribution in accordance with the Participant's
deferral election.
3
"Early Retirement Date" means the date on which a Participant satisfies
both of the following requirements:
(a) Attains age 60; and
(b) Completes ten (10) Years of Service.
"Elective Contribution" means the Employer's contributions to the Plan
that is made pursuant to the Participant's deferral election provided under
the Plan. In addition, any Employer Qualified Non-Elective Contribution shall
be considered an Elective Contribution for purposes of the Plan.
"Eligible Employee" means any Employee, except as follows:
(a) Employees whose employment is governed by the terms of a
collective bargaining agreement between employee representatives (within
the meaning of Code Section 7701(a)(46)) and the Employer under which
retirement benefits were the subject of good faith bargaining between the
parties, unless such agreement expressly provides for such coverage in
the Plan, will not be eligible to participate in this Plan; and
(b) Employees of Affiliated Employers shall not be eligible to
participate in this Plan unless such Affiliated Employers have
specifically adopted this Plan in writing.
"Employee" means any person who is employed by the Employer or Affiliated
Employer, but excludes any person who is an independent contractor. Employee
shall include Leased Employees within the meaning of Code Sections 414(n)(2)
and 414(o)(2) unless such Leased Employees are covered by a plan described in
Code Section 414(n)(5) and such Leased Employees do not constitute more than
20% of the recipient's non-highly compensated workforce. For any Plan Year in
which the Plan is deemed to be a Top Heavy Plan, no Key Employee shall be
permitted to participate in the Plan.
"Employer" means Quaker Chemical Corporation, a Pennsylvania corporation,
any successor which maintains the Plan and any Affiliated Employer (as defined
in the Plan) that has adopted the Plan in writing.
"Family Member" means, with respect to an affected Participant, such
Participant's spouse, such Participant's lineal descendants and ascendants and
their spouses, all as described in Code Section 414(q)(6)(B).
"Highly Compensated Employee" means an Employee described in Code Section
414(q) and the Regulations thereunder, and generally means an Employee who
performed services for the Employer during the "determination year" and is in
one or more of the following groups:
(a) Employees who at any time during the "determination year" or
"look-back year" were "five percent owners".
(b) Employees who received "415 Compensation" during the "look-back
year" from the Employer in excess of $75,000.
(c) Employees who received "415 Compensation" during the "look-back
year" from the Employer in excess of $50,000 and were in the Top Paid
Group of Employees for the Plan Year.
(d) Employees who during the "look-back year" were officers of the
Employer (as that term is defined within the meaning of the Regulations
under Code Section 416) and received "415 Compensation" during the
"look-back year" from the Employer greater than 50 percent of the limit
in effect under Code Section 415(b)(1)(A) for any such Plan Year. The
number of officers shall be limited to the lesser of (i) 50 employees; or
(ii) the greater of 3 employees or 10 percent of all employees. If the
Employer does not have at least one officer whose annual "415
Compensation" is in excess of 50 percent of the Code Section 415(b)(1)(A)
limit, then the highest paid officer of the Employer will be treated as a
Highly Compensated Employee.
(e) Employees who are in the group consisting of the 100 Employees
paid the greatest "415 Compensation" during the "determination year" and
are also described in (b), (c) or (d) above when these paragraphs are
modified to substitute "determination year" for "look-back year".
The "look-back year" shall be the calendar year ending with or within the
Plan Year for which testing is being performed, and the "determination year"
(if applicable) shall be the period of time, if any, which extends beyond the
"look-back year" and ends on the last day of the Plan Year for which testing
is being performed (the "lag period").
4
If the "lag period" is less than twelve months long, the dollar threshold
amounts specified in (b), (c) and (d) above shall be prorated based upon the
number of months in the "lag period".
For purposes of this Section, the determination of "415 Compensation"
shall be made by including amounts that would otherwise be excluded from a
Participant's gross income by reason of the application of Code Sections 125,
402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made
pursuant to a salary reduction agreement, by including amounts that would
otherwise be excluded from a Participant's gross income by reason of the
application of Code Section 403(b). Additionally, the dollar threshold
amounts specified in (b) and (c) above shall be adjusted at such time and in
such manner as is provided in Regulations. In the case of such an adjustment,
the dollar limits which shall be applied are those for the calendar year in
which the "determination year" or "look-back year" begins.
In determining who is a Highly Compensated Employee, Employees who are
non-resident aliens and who received no earned income (within the meaning of
Code Section 911(d)(2)) from the Employer constituting United States source
income within the meaning of Code Section 861(a)(3) shall not be treated as
Employees. Additionally, all Affiliated Employers shall be taken into account
as a single employer and Leased Employees within the meaning of Code Sections
414(n)(2) and 414(o)(2) shall be considered Employees unless such Leased
Employees are covered by a plan described in Code Section 414(n)(5) and are
not covered in any qualified plan maintained by the Employer. The exclusion
of Leased Employees for this purpose shall be applied on a uniform and
consistent basis for all of the Employer's retirement plans. Highly
Compensated Former Employees shall be treated as Highly Compensated Employees
without regard to whether they performed services during the "determination
year".
"Highly Compensated Former Employee" means a former Employee who had a
separation year prior to the "determination year" and was a Highly Compensated
Employee in the year of separation from service or in any "determination year"
after attaining age 55. Notwithstanding the foregoing, an Employee who
separated from service prior to 1987 will be treated as a Highly Compensated
Former Employee only if during the separation year (or year preceding the
separation year) or any year after the Employee attains age 55 (or the last
year ending before the Employee's 55th birthday), the Employee either received
"415 Compensation" in excess of $50,000 or was a "five percent owner". For
purposes of this Section, "determination year", "415 Compensation" and "five
percent owner" shall be determined in accordance with Section 1.26. Highly
Compensated Former Employees shall be treated as Highly Compensated Employees.
The method set forth in this Section for determining who is a "Highly
Compensated Former Employee" shall be applied on a uniform and consistent
basis for all purposes for which the Code Section 414(q) definition is
applicable.
"Highly Compensated Participant" means any Highly Compensated Employee
who is eligible to participate in the Plan.
"Insurer" means the Principal Financial Group, a diversified family of
financial services companies headquartered in Des Moines, Iowa, and any other
insurance company or companies selected by the Trustee or the Employer.
"Investment Manager" means an entity that (a) has the power to manage,
acquire, or dispose of Plan assets and (b) acknowledges fiduciary
responsibility to the Plan in writing. Such entity must be a person, firm, or
corporation registered as an investment adviser under the Investment Advisers
Act of 1940, a bank, or an insurance company.
"IRS" means the Internal Revenue Service of the United States Department
of the Treasury.
"Late Retirement Date" means the first day of the month coinciding with
or next following a Participant's actual Retirement Date after having reached
his Normal Retirement Date.
"Net Income" means the profit from operations, adjusted in accordance for
items approved from time to time by the Board of Directors of the Company for
the Company's fiscal year, based upon the Company's domestic operations and/or
such other operations as the Company's Board of Directors shall from time to
time consider appropriate, as determined from the Company's internal financial
statements for such operations.
"Non-Highly Compensated Participant" means any Participant who is neither
a Highly Compensated Employee nor a Family Member.
5
"Normal Retirement Age" means the Participant's 65th birthday.
"Normal Retirement Date" means the first day of the month subsequent to
the Participant's Normal Retirement Age.
"Participant" means any Eligible Employee who participates in the Plan in
accordance with its terms, and has not for any reason become ineligible to
participate further in the Plan.
"Plan Year" means the Plan's accounting year of twelve (12) months
commencing on January 1st of each year and ending the following December 31st.
"Profit-Sharing Contribution" means the Employer's discretionary
contributions to the Plan from Net Income.
"Regulation" means the Income Tax Regulations as promulgated by the
Secretary of the Treasury or his delegate, and as amended from time to time.
"Retirement Date" means the date as of which a Participant retires for
reasons other than Total and Permanent Disability, whether such retirement
occurs on a Participant's Early Retirement Date, Normal Retirement Date or
Late Retirement Date.
"Terminated Participant" means a person who has been a Participant, but
whose employment has been terminated other than by death, Total and Permanent
Disability or retirement.
"Top Heavy Plan" means a plan described in Section 2.2(a) of the Plan.
"Top Heavy Plan Year" means a Plan Year during which the Plan is a Top
Heavy Plan.
"Total and Permanent Disability" means a physical or mental condition of
a Participant resulting from bodily injury, disease, or mental disorder
continuing for at least twenty-four (24) consecutive months and which renders
him eligible for disability benefits under Title II of the Federal Social
Security Acts. The disability of a Participant shall be determined by a
licensed physician chosen by the Administrator. The determination shall be
applied uniformly to all Participants.
"Trustee" means CoreStates Bank, which will hold and invest the assets in
the Quaker Stock Fund, a separate trust forming a part of the Plan.
"Trust Fund" or "Fund" means the Principal Financial Group or the assets
of the Plan and Trust as the same shall exist from time to time.
"Year of Service" means the computation period of twelve (12) consecutive
months, herein set forth, during which an Employee has at least 1,000 Hours of
Service. Years of Service with any Affiliated Employer shall be recognized or
Years of Service with the Employer.
6
THE PLAN
GENERAL
The Quaker Chemical Corporation Profit Sharing and Retirement Savings
Plan, as amended (the "Plan"), originally effective December 31, 1953, covers
the Eligible Employees of the Company and of each "Affiliated Employer" (as
defined in the Plan) which has adopted the Plan.
The Plan was amended and restated on November 3, 1992, effective as of
January 1, 1989, to comply with the provisions of the Tax Reform Act of 1986
and subsequent legislation. This amendment and restatement also contains
provisions, effective January 1, 1993, incorporating into the Plan a qualified
cash or deferred arrangement under Section 401(k) of the Code. The Company
intends to submit the amended and restated Plan to the IRS for its
determination that the Plan, as amended and restated, meets the requirements
of a qualified profit sharing plan under Section 401(a) of the Code and a
qualified cash or deferred arrangement under Section 401(k) of the Code and
that the Trust is exempt from Federal income tax under Section 501(a) of the
Code. It is possible that the IRS could request further amendments to the
Plan, and could condition any determination letter upon timely adoption of
such amendments, and the Company has undertaken to make all changes required
by the IRS in order to qualify the Plan, as amended, or to maintain its
qualification under Section 401 of the Code. The Company previously obtained
from the IRS a determination letter to the effect that the Plan, as amended
through December 31, 1988, satisfied the requirements of a qualified profit
sharing plan under Section 401(a) of the Code.
PURPOSE
The Plan is designed to provide Eligible Employees with retirement
benefits and an opportunity to increase their retirement savings by offering
the advantages of a qualified cash or deferred arrangement under Section
401(k) of the Code. See "Federal Tax Aspects." In general, an Employee who
meets the Plan's eligibility requirements becomes a Participant. A
Participant may authorize the Company to make an Elective Contribution (as
described under "Contributions," below) by reducing the Participant's
Compensation by an amount not in excess of 8% of his Compensation. Subject to
limitations set forth in the Plan, the Company will make Matching
Contributions which will partially match Elective Contributions. The Company
further may choose to make Profit Sharing Contributions. A Participant may
direct the investment of all of his or her Elective Contributions, together
with Matching Contributions and any Profit Sharing Contributions into one or
more of four investment options in accordance with the provisions of the Plan.
See "Investment of Contributions," below.
ADMINISTRATION
The Administrator, a committee of two or more individuals appointed by
the Board of Directors of the Company, is responsible for the administration
of the Plan for the exclusive benefit of the Participants and their
Beneficiaries, subject to the terms of the Plan. The Administrator is a
"named fiduciary" as such term is defined in the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"). The Administrator has the power
and the duty to take all action and to make all decisions necessary or proper
to carry out the Plan. The determination of the Administrator as to any
question involving the general administration and interpretation of the Plan
is conclusive and binding on any person making a claim under the Plan. The
Administrator may make and enforce rules and regulations relating to the Plan.
In administering the Plan, the Administrator must act in a nondiscriminatory
manner.
The assets of the Plan will be held pursuant to the terms of the Contract
with the Insurer and, with respect to the Quaker Stock Account, in the Trust
Fund. The Administrator has no duty with respect to the investment of the
funds held under the Contract or in the Trust Fund. The Insurer makes
investment decisions with respect to assets held under the Contract. The
Trustee has powers and responsibilities with respect to the administration of
the Quaker Stock Account, including (i) initial investment of the funds
deposited in the Quaker Stock Account, (ii) reinvestment, sale, exchange or
other disposition of all or any portion of each such Account's assets, (iii)
exercise of the voting rights associated with any securities constituting a
part of such Account's assets, (iv) disbursement from such Account in
accordance with instructions from the Administrator, and (v) the valuation of
such Account.
In connection with its control and management of the Quaker Stock
Account, the Trustee selects brokers to effect particular securities
transactions resulting in the most favorable net results for the Plan by
taking into account such factors as price, commission, size of order and
execution by the broker. Factors such as the brokers' execution
7
and capital commitment capabilities, initiation of trades and securities
syndication are evaluated by the Trustee in selecting a broker. Brokerage
transactions are not directed to brokers because of their research services.
The Trustee periodically evaluates the reasonableness of brokerage commissions
paid by the Quaker Stock Account by reviewing such factors as the competitive
negotiated rate structure at the time the commission was charged and the
effectiveness of the brokers' executions. The Trustee may pay a brokerage
commission in excess of that which another broker might have charged for
effecting the same transaction in recognition of the value of the brokerage
execution services performed by the selected broker.
The expenses of administration of the Plan are payable out of the assets
of the Contract and the Trust Fund unless paid by the Company. Except as
otherwise described in this Prospectus, the expenses of the administration of
the Plan, including compensation payable to the Trustee and the Insurer, the
compensation of any investment manager and the expenses incurred by the
Administrator in discharging its duties, will be paid or provided for by the
Company. Notwithstanding the foregoing, no excise tax or other liability
imposed upon the Trustee, the Insurer, the Administrator or anyone else for
failure to comply with the provisions of any federal law shall be subject to
payment or reimbursement from the assets of the Plan. For information
regarding certain fees to be paid out of the assets of the Plan, see
"Description of Investment Options", below.
ELIGIBILITY
Each Eligible Employee will become a Participant in the Plan as of the
first day of the 12th month following the month in which the Employee's
employment with an Employer commences, unless such employment commenced on the
first day of a month, in which case such Employee will become a Participant on
the first anniversary of such commencement of employment (the "Entry Date"),
provided, in either case, that the Employee is employed by an Employer
throughout the period and is so employed as of such Entry Date. If not
employed on such date, an Eligible Employee is entitled to become a
Participant effective as of the Entry Date subsequent to his or her date of
rehire. An Employee's participation in the Plan will not be terminated by
such Employee's transfer of employment among the Company and Affiliated
Employers who are participating in the Plan, provided such Employee retains
the status as an Eligible Employee. If a Participant transfers to an
Affiliated Employer which has not adopted the Plan, no further contributions
to the Plan may be made on his or her behalf unless and until he or she
resumes the status of an Eligible Employee. However, amounts credited to such
Participant's Account will remain invested. The Administrator has the sole
responsibility under the Plan for determining the eligibility of each Employee
for participation in the Plan based upon information furnished by the
Employer. A determination regarding the eligibility of an Employee which is
made in accordance with the Plan and the Act will be conclusive and binding
upon all persons.
In the event a Participant ceases to be a member of an eligible class of
Employees and thus becomes ineligible to participate in the Plan, such
Employee will be entitled to resume the status of a Participant immediately
upon his return to an eligible class of Employees. In the event an Employee
who is not a member of an eligible class of Employees becomes a member of an
eligible class, such Employee will be entitled to become a Participant
immediately, provided such Employee has satisfied the minimum age and service
requirements and would have otherwise previously become a Participant.
Effective June 1, 1993, Employees represented by Local 174 of the
International Union, United Automobile, Aerospace & Agricultural Implement
Workers of America, became eligible to make Elective Contributions and receive
Matching Contributions, but are not eligible to receive Profit Sharing
Contributions.
An Eligible Employee may, subject to the approval of his Employer, elect
not to participate in the Plan. An election not to participate in the Plan
must be communicated to the Company, in writing, at least 30 days before the
beginning of a Plan Year.
The number of employees eligible to participate in the Plan as of
September 30, 1994 was approximately 313.
CONTRIBUTIONS
As described below, a Participant may elect to have Elective
Contributions made for his account, and the Employer will make Matching
Contributions and may make discretionary Profit-Sharing Contributions, in
accordance with the provisions of the Plan.
8
Elective Contributions. A Participant may elect to have Elective
Contributions made to the Plan for his account pursuant to Section 401(k) of
the Code. A Participant who desires to have Elective Contributions made to
his account must select the amount of his Compensation for the Plan Year which
he wishes to defer the receipt of (a "deferral election"). Under the terms of
the Plan, the amount of a deferral may equal any whole percentage up to 8%,
subject to an annually adjusted dollar limitation ($9,240 for 1994). See
"Limitations on Contributions," below. The Employer will make the appropriate
reduction in the salary of the Participant and contribute a corresponding
amount as an Elective Contribution for the account of the Participant.
A Participant may commence making deferral elections as of the first day
of the January, April, July or October coincident with or next following the
Participant's Entry Date. If a Participant fails to make an initial salary
deferral election within such time, then he may thereafter make an election
effective as of any January 1 or July 1 thereafter. Each Participant must
indicate the amount of his deferral election in a written salary reduction
agreement between the Participant and Administrator executed and in effect
prior to the first day of the first pay period to which it applies. A
deferral election may be changed or suspended by a new election effective as
of the first day of any January, April, July or October during the Plan Year
by filing a written notice with the Administrator no later than 30 days prior
to the pay period for which such modification is to be effective. An Elective
Contribution is made through a payroll deduction and must be paid by the
Employer to the Plan within a reasonable period after it is withheld from the
Participant's pay, and in no event later than 30 days after the date on which
the deferred amount would otherwise have been payable to the Participant in
cash.
Elective Contributions made to the Account of a Participant are fully
(100%) vested and nonforfeitable, and are invested in accordance with the
Participant's investment election. See "Investment of Contributions", below.
If the percentage of Compensation specified in the deferral election of a
Participant would result in an Elective Contribution in excess of an
applicable dollar limit, the applicable Elective Contribution and the
corresponding deferral of income will be reduced to the permitted limit
without further action of the Participant. However, the amount of a deferral
election will not be increased unless the Participant formally changes his
election. Because the deferral election of a Participant is a specified
percentage of his Compensation, any increase or decrease in such Participant's
Compensation at any time will automatically result in a corresponding
adjustment to the Participant's Elective Contribution in accordance with the
Plan, except to the extent any applicable dollar limitation precludes such
increase or decrease.
Matching Contributions. A Matching Contribution is made by the Employer
for each Plan Year for each Participant who makes a deferral election (other
than an Employee eligible to receive Incentive Bonuses from the Employer).
The Matching Contribution made on behalf of a Participant for a Plan Year is
an amount equal to $150.00 for each whole percentage of such Participant's
Compensation deferred as an Elective Contribution in such Plan Year, provided,
however, that the Matching Contribution for a Participant in any Plan Year may
not exceed $450.00. The following table sets forth the respective percentages
of Compensation that a Participant may elect to defer and have credited as an
Elective Contribution and the corresponding Matching Contributions:
PERCENTAGE OF AMOUNT OF
COMPENSATION MATCHING
DEFERRAL CONTRIBUTION
------------- ------------
1% $150.00
2% $300.00
3% or more $450.00
Each Matching Contribution is made at the time the corresponding Elective
Contribution is made. Matching Contributions made to the Account of a
Participant are fully (100%) vested and nonforfeitable, and are invested in
accordance with the Participant's investment election. See "Investment of
Contributions", below.
Profit-Sharing Contributions. Profit-Sharing Contributions may be made
by the Employer, out of Net Income, at its discretion. Any Profit-Sharing
Contribution made in a Plan Year will be allocated among the Employees
eligible to participate in the contribution pro rata in accordance the
respective levels of their Base Compensation for such Plan Year. Pursuant to
the terms of the Plan, a Profit-Sharing Contribution may not be made or
allocated to the Account of any Employee designated by the Company as a Sales
Process Engineer, and, generally, an Employee will be entitled to share in a
Profit-Sharing Contribution for a Plan Year only if he completes a Year of
Service with at least 1,000 Hours of Service during that Plan Year and is
employed by the
9
Employer on the last day of the Plan Year. Notwithstanding the foregoing
a Participant will be entitled to participate in a Profit-Sharing Contribution
if he is not actively employed on the last day of the Plan Year due to
Retirement (Early, Normal or Late), Total and Permanent Disability or death.
Profit-Sharing Contributions made to the Account of a Participant are
fully (100%) vested and nonforfeitable, and are invested in accordance with
the Participant's investment election. See "Investment of Contributions."
Top Heavy Rules. If the Plan becomes "top heavy" as defined in Section
416 of the Code, certain limitations may be placed on contributions made on
behalf of "key employees" as defined in Section 416 and certain minimum
contributions may be required on behalf of certain other Participants as set
forth in the Plan.
ROLLOVER CONTRIBUTIONS
Any Participant of the Plan, at any time, may submit a written
application requesting the Administrator to direct the Trustee or Insurer to
accept a Rollover contribution. A Rollover accepted by the Administrator will
be placed in a Rollover Account established for the Participant and will
become part of the Fund. The amount placed in a Rollover Account, which will
be fully vested at all times and will not be subject to forfeiture for any
reason, will be invested in accordance with the contributing Participant's
instructions. See "Investment of Contributions," below. Rollover
contributions are not subject to the limits outlined under "Limitations on
Contributions," below.
LIMITATIONS ON CONTRIBUTIONS
Section 401(k) of the Code establishes maximum percentages of
compensation which may be contributed as Elective Contributions by
Participants in the Plan who constitute Highly Compensated Employees. Under
the Plan, the Actual Deferral Percentage for the group of Highly Compensated
Employees for a Plan Year, based upon Elective Contributions, may not exceed
the Actual Deferral Percentage for the group of all other eligible employees,
multiplied by 1.25. Alternatively, the excess of the Actual Deferral
Percentage for the group of Highly Compensated Employees for a Plan Year over
the Actual Deferral Percentage for the group of all other eligible employees
may not exceed two percentage points or such lesser amount as may be
established by applicable regulations; and the Actual Deferral Percentage for
the group of Highly Compensated Employees may not exceed the Actual Deferral
Percentage for the group of all other eligible employees, multiplied by two.
Amounts contributed in violation of these limits must be returned to the
Participants on whose behalf the excess Elective Contributions were made, as
provided in Section 401(k) of the Code.
Under Section 401(k) of the Code, no Participant's Elective Contributions
for any Plan Year may exceed an annually adjustable dollar limitation, which
is $9,240 for 1994. Any Elective Contribution in excess of this limit must be
returned to the Participant making such contribution, as provided in Section
401(k) of the Code.
Under Section 415 of the Code, the total of all Elective, Matching and
Profit-Sharing Contributions allocated to a Participant's Account for any year
generally may not exceed the lesser of (a) $30,000 or (b) 25% of his
Compensation for the year. The $30,000 limitation is subject to cost of
living adjustments. If, for any year, these limitations are exceeded, the
Plan currently provides that the excess will be deemed first to consist of
Profit-Sharing Contributions (to the extent that the Participant would have
been entitled to Profit-Sharing Contributions in the absence of these
limitations), which will be allocated to the Accounts of Participants who have
not yet reached their respective Section 415 limits.
CHANGE OF CONTRIBUTIONS
A Participant may elect to increase or decrease the amount of his
Elective Contribution effective as of the first day of any January, April,
July or October during a Plan Year, by filing a written notice with the
Administrator no later than 30 days prior to the pay period for which such
modification is to be effective. A modification will not have a retroactive
effect and will remain in force until revoked.
A Participant may elect to prospectively revoke his salary reduction
agreement in its entirety at any time during the Plan Year by providing the
Administrator with 30 days written notice of such revocation (or upon such
shorter notice period as may be acceptable to the Administrator). Such a
revocation will become effective as of the beginning of the first pay period
coincident with or next following the expiration of the notice period.
Furthermore, the termination of the Participant's employment, or the cessation
of his participation in the Plan for any reason,
10
will be deemed to revoke any salary reduction agreement then in effect,
effective immediately following the close of the pay period within which such
termination or cessation occurs.
ACCOUNTS
The accounts and records of the Plan are maintained by the Administrator
and disclose the status of the Account of each Participant. Each Participant
will be advised from time to time, at least once each year, of the balance of
his Account.
Each Participant's Account under the Plan represents the Participant's
interest in the Funds established under the Plan and any insurance policies on
his life purchased pursuant to the Plan.
INVESTMENT OF CONTRIBUTIONS
Generally, each Participant must direct how his Elective Contributions,
and his portion of Matching Contributions, and Profit-Sharing Contributions
and Rollover Account are to be allocated among the investment options
available under the Plan. The Plan provides that in the event a Participant
does not specifically designate the investment option or options for all or
part of his Account, the Insurer shall invest such funds in the Guaranteed
Interest Account until a designation can be obtained from the Participant.
A Participant may change his investment election with respect to the
investment of future contributions or transfer previously contributed amounts
among the available investment options described below. However, a
Participant may not change investment options other than as of the first
January 1, April 1, July 1 or October 1, following 30-days advance notice of
such change. The Plan Administrator will accept a Participant's written
notice of a change in investment options.
Neither the Trustee, the Insurer, any investment advisors to the Funds,
the Plan Administrator, nor any officer or employee of the Company is
empowered to advise a Participant as to the manner in which his Account should
be invested. THE FACT THAT A PARTICULAR INVESTMENT OPTION IS AVAILABLE TO
PARTICIPANTS FOR INVESTMENT UNDER THE PLAN SHALL NOT BE CONSTRUED AS A
RECOMMENDATION FOR INVESTMENT IN SUCH INVESTMENT OPTION. A PARTICIPANT
ASSUMES ALL RISKS IN CONNECTION WITH CHANGES IN THE VALUE OF THE INVESTMENT
OPTION OR OPTIONS IN WHICH HE ELECTS TO INVEST. EARNINGS, IF ANY, OF EACH
INVESTMENT OPTION WILL BE REINVESTED IN THE SAME INVESTMENT OPTION, AND
LOSSES, IF ANY, WILL BE ALLOCATED ONLY TO THE INVESTMENT OPTION INCURRING THE
LOSS.
DESCRIPTION OF INVESTMENT OPTIONS
There currently are four investment options available to Participants
under the Plan. Set forth below is information concerning each of such
investment options.
I. QUAKER STOCK ACCOUNT
This investment option is a trust the assets of which are invested by the
Trustee primarily in the Common Stock of the Company, subject to the right of
the Trustee to invest such assets or any part thereof in short-term fixed
income investments. The Trustee has discretion as to the timing and manner of
purchasing shares. Such purchases may include open-market or privately
negotiated transactions. Cash dividends, if any, on the shares held in this
trust will be retained by the trust and invested in the same manner as the
other assets of the trust, and any stock dividends or shares issued pursuant
to a stock split on the shares held in this trust will become part of the
trust's assets. For information concerning the declaration of dividends on
the Company's Common Stock during the past two fiscal years, see the
Supplemental Financial Information included in the Company's most recent
Annual Report to Shareholders. The payment of dividends on the Company's
Common Stock is in the discretion of the Company's Board of Directors and the
dividends paid by the Company in the past are not necessarily indicative of
the dividends that will be paid in the future.
Participants investing in the Quaker Stock Account will not have any
voting rights with respect to the shares held in the trust. The voting rights
with respect to such shares are vested in the Trustee.
11
The value of the Quaker Stock Account will be increased or decreased as
the market price of the Company's Common Stock increases or decreases.
Accordingly, as the market price of the Common Stock fluctuates up or down so
will the value of a Participant's share of this trust. Commissions paid on
account of transactions by this trust are not paid by the Company but are
charged against the assets of the trust. Accordingly, the value of a
Participant's share of this trust could be less than the amount of the
contributions to the trust. Since the Quaker Stock Account is not
diversified, it has a higher degree of risk than the other stock funds which
are diversified.
The Company's Common Stock is traded on the National Market System of the
National Association of Securities Dealers, Inc. The following table sets
forth for the calendar quarters shown the range of quotations for the Common
Stock on the NASDAQ National Market System. On October 26, 1994, the last
reported sale price of the Common Stock on the NASDAQ National Market System
was $18 per share.
1991 Low High
---- --- ----
First Quarter............................ 15 22-1/4
Second Quarter........................... 17-1/2 21-1/2
Third Quarter............................ 17-1/4 20-3/4
Fourth Quarter........................... 19-1/4 21-3/4
1992
----
First Quarter............................ 18-3/4 22-1/4
Second Quarter........................... 21 26
Third Quarter............................ 19-1/2 24-3/4
Fourth Quarter........................... 19-3/4 23-1/2
1993
----
First Quarter............................ 20-3/4 24-1/2
Second Quarter........................... 17-3/4 23
Third Quarter............................ 16-1/2 20
Fourth Quarter........................... 14-1/4 18-1/4
1994
----
First Quarter............................ 14-3/4 19-1/2
Second Quarter........................... 16 18-3/4
Third Quarter............................ 17-1/4 18-3/4
Fourth Quarter (through October 26)...... 17-1/4 18
None of the Company's Common Stock purchased for the Quaker Stock Account
pursuant to the Plan will be purchased from the Company. Because all of the
Company's Common Stock purchased for the Quaker Stock Account will be
previously issued and outstanding, the Company will not receive any proceeds
on account of any purchase of its Common Stock for the Quaker Stock Account.
In order to facilitate compliance with Section 16 of the Securities
Exchange Act of 1934 (the "1934 Act") and the regulations promulgated
thereunder, a Participant in the Plan who is subject to the reporting
requirements of Section 16(a) of the 1934 Act (i.e., an "officer" of the
Company, within the meaning of Rule 16a-1(f) under the 1934 Act, a director of
the Company or the beneficial owner of 10% or more of the issued and
outstanding shares of the Company's Common Stock, within the meaning of Rule
16a-1(a)(1) under the 1934 Act) will not be permitted to invest in the Quaker
Stock Account.
II. GUARANTEED INTEREST ACCOUNT
Under the Contract, amounts allocated to this account are invested in
Guaranteed Interest Accounts ("GIA") of the Insurer and constitute part of the
general account of the Insurer. The investments of the Insurer's general
account emphasize privately-placed loans such as bonds and commercial
mortgages with maturities that generally parallel the Insurer's guarantees
under its GIAs. The Insurer's GIAs offer guaranteed principal and interest
for different length guarantee periods selected by the Administrator. The
guarantee periods of two and five years are available to Participants. All
contributions received during the first year (hereinafter referred to as the
"Deposit Year") of each
12
guarantee period become part of that year's GIA. Each contribution made
during a Deposit Year receives the then available guaranteed interest rate for
the guarantee period selected, as declared from time to time by the Insurer.
At the end of the Deposit Year, the average guaranteed rate (weighed by the
size and timing of each deposit) is determined. The average guaranteed rate
is then credited and compounded annually to the account balance for the
remaining years of the guarantee period. At the end of each Deposit Year,
that GIA is closed and no additional contributions are made to it.
Contributions made in the next Deposit Year become part of a new guarantee
period with its length of guarantee period determined in the same manner. A
GIA matures at the end of its guarantee period and then may be reinvested
(without penalty or adjustment) in a current GIA or be transferred to any
other type of investment available under the Plan.
Any transfer out of a GIA prior to the end of its guarantee period (other
than for benefit payments at retirement, death, disability, or termination of
employment) will be subject to a charge if the guaranteed interest rate for an
account with the same guarantee period on the surrender date is greater than
the guaranteed interest rate being credited to the GIA from which the transfer
is being made. The charge, a percentage of the amount being withdrawn, is the
difference between the guaranteed interest rate for new deposits to an account
with the same guarantee period and the guaranteed interest rate being credited
to the GIA from which the transfer is being made, multiplied by the number of
years and fractions (to the nearest day) remaining in the guarantee period of
the GIA from which the transfer is being made. If the guaranteed interest
rate for new deposits to an account with the same guarantee period is equal to
or less than the average credited rate for the GIA from which the transfer is
being made, the transfer will involve no charge. If a Participant has more
than one GIA and does not specify the GIA from which the transfer is to be
made, the transfer will automatically be made from the newest GIA first,
working back to the oldest GIA until the amount requested has been
transferred.
The following table sets forth, as of the first day of each of the months
indicated, the annualized rate (net after deduction of investment expenses,
which are not paid by the Company but are charged against the assets of this
account) credited to deposits to GIAs with a two-year term.
MONTH 1990 1991 1992 1993 1994
----- ---- ---- ---- ---- ----
January.................. 8.10% 7.40% 5.00% 4.70% 4.20%
February................. 8.70% 7.30% 5.50% 4.45% 3.90%
March.................... 8.80% 7.20% 5.75% 4.05% 4.55%
April.................... 8.80% 7.30% 6.10% 4.00% 5.25%
May...................... 9.25% 7.15% 5.80% 3.90% 5.85%
June..................... 8.85% 6.95% 5.45% 4.30% 5.90%
July..................... 8.55% 7.10% 5.05% 4.25% 6.00%
August................... 8.05% 6.95% 4.55% 4.15% 5.90%
September................ 8.15% 6.50% 4.55% 3.85% 6.10%
October.................. 8.05% 6.25% 3.80% 3.75% _
November................. 7.90% 5.95% 4.65% 4.15% _
December................. 7.65% 5.65% 5.05% 4.30% _
The following table sets forth, as of the first day of each of the months
indicated, the annualized rate (net after deduction of investment expenses,
which are not paid by the Company but are charged against the assets of this
account) credited to deposits to GIAs with a five-year term.
MONTH 1990 1991 1992 1993 1994
----- ---- ---- ---- ---- ----
January.................. 8.40% 8.25% 6.55% 6.45% 5.55%
February................. 9.05% 8.20% 7.10% 6.00% 5.25%
March.................... 9.10% 8.20% 7.40% 5.50% 5.90%
April.................... 9.10% 8.70% 7.75% 5.50% 6.65%
May...................... 9.60% 8.35% 7.55% 5.40% 6.95%
June..................... 9.20% 8.20% 7.10% 5.65% 7.00%
July..................... 8.90% 8.45% 6.75% 5.40% 7.05%
August................... 8.60% 8.30% 6.20% 4.45% 6.95%
September................ 8.95% 7.85% 6.20% 5.15% 7.10%
October.................. 8.95% 7.55% 5.65% 4.95% _
November................. 8.70% 7.40% 6.35% 5.15% _
December................. 8.45% 7.15% 6.70% 5.60% _
13
The foregoing information concerning the Insurer's GIA's is a summary of
information provided to the Company by the Insurer, and such summary is
qualified in its entirety by reference to such information which may be
obtained from the Company by any Participant upon written or oral request
directed to the Company's Corporate Controller, Quaker Chemical Corporation,
Elm and Lee Streets, Conshohocken, Pennsylvania 19428 (610-832-4000).
III. U.S. STOCK ACCOUNT
This investment option is an account the assets of which are invested in
the U.S. Stock Account (Separate Account A), a pooled investment account
invested in U.S. securities, primarily common stocks ("Separate Account A").
Separate Account A is managed by Invista Capital Management, Inc., a
registered investment adviser ("Invista"). Invista is the wholly-owned
subsidiary of Principal Mutual Life Insurance Company, which owns the assets
of Separate Account A.
According to information provided to the Company by the Insurer, the
objective of Separate Account A is to earn a long-term rate of return greater
than the average rate of return for stocks in general. However, Participants
should understand that there can be no assurance that the objective of
Separate Account A will be achieved.
The following table sets forth for the respective periods indicated the
ending value of a single $10,000 invested in Separate Account A at the
beginning of the period, compared with the corresponding values for the Dow
Industrials and the Standard & Poors 500 ("S&P 500").
PERIOD ENDED SEPARATE DOW
SEPTEMBER 30, 1994 ACCOUNT A* INDUSTRIALS* S&P 500*
------------------ ---------- ------------ --------
3 months.................... $10,169 $10,169 $10,122
12 months................... 10,677 11,108 10,369
5 years..................... 10,951 11,083 10,914
10 years.................... 11,383 11,618 14,600
- ---------------
* The amounts reflected for the Dow Industrials and S&P 500 do not have
any investment or brokerage expense deducted from them, while the amounts
reflected for Separate Account A are net of the applicable investment
management fee which is not paid by the Company but is charged against the
assets of Separate Account A.
The following table sets forth as of December 31, 1993, 1992 and 1991,
respectively, information provided to the Company by the Insurer concerning
the ending values of a single $10,000 invested in Separate Account A on the
respective investment dates indicated:
ENDING VALUE AT
INVESTMENT DATE INVESTMENT PERIOD DECEMBER 31, 1993
--------------- ----------------- -----------------
January 1, 1993.............. One Year $10,943
January 1, 1992.............. Two Years 11,970
January 1, 1991.............. Three Years 16,500
ENDING VALUE AT
INVESTMENT DATE INVESTMENT PERIOD DECEMBER 31, 1992
--------------- ----------------- -----------------
January 1, 1992.............. One Year $10,936
January 1, 1991.............. Two Years 15,074
January 1, 1990.............. Three Years 14,018
ENDING VALUE AT
INVESTMENT DATE INVESTMENT PERIOD DECEMBER 31, 1991
--------------- ----------------- -----------------
January 1, 1991.............. One Year $13,784
January 1, 1990.............. Two Years 12,819
January 1, 1989.............. Three Years 15,239
According to information provided to the Company by the Insurer, except
for small amounts held in money market investments for normal cash flow
purposes, Separate Account A is kept fully invested in stocks through all
market cycles, without any attempt to anticipate future stock market
direction or to hold cash during market declines. A "top-down" approach to
stock selection is employed in which fundamental shifts in the economy are
14
identified and, based on these factors, industries that are expected to
benefit are selected and reviewed to identify companies that are believed
to be undervalued by the market.
According to the investment policy for Separate Account A, the primary
investment objectives for Separate Account A are long-term capital
appreciation and realization of increasing dividend income. Assets of
Separate Account A will normally be invested in a diversified portfolio of
equities consisting primarily of common stocks. In choosing common stock
investments there is a particular concern for long-term earnings prospects
and the relationship of then-current stock prices to such prospects.
Short-term trading is not intended, but occasional investments may be made
for the purpose of seeking short-term or medium-term capital appreciation.
In periods when the general level of prices for equity investments or
general economic conditions appear to warrant such action, some of the
assets of Separate Account A may be invested in government bonds, corporate
bonds, debentures or other evidences or indebtedness whether or not
convertible into stocks or carrying stock warrants, notes, or other
evidences or indebtedness secured by mortgages or deeds of trust on real
property or pledges of personal property, and preferred stocks, or be
retained in cash. To the extent feasible, assets of Separate Account A
will be kept fully invested, but from time to time reasonable amounts may
be maintained in cash or short-term obligations such as, but not limited
to, United States Treasury bills, bankers' acceptances, certificates of
deposit, and commercial paper. Investments will be diversified among
various industries. Except for U.S. Government and Agency obligations,
investments in securities of any one issuer are limited to no more than 8%
of the value of the assets in the account. The purchase and sale of real
estate will not be a principal activity, and not more than 10% of the
assets of Separate Account A will be invested in real estate (which, for
this purpose, excludes investments in notes or other evidences of
indebtedness secured by mortgages or deeds of trust on real property). The
assets of Separate Account A will not be invested for the purpose of
exercising control or management of any company. Securities will not be
purchased for Separate Account A on margin, except for such short-term
credits as are necessary for the clearance of transactions; short sales of
securities will not be made; puts or calls will not be issued; and no
commodity trading will be conducted.
The foregoing is a summary of the investment policy for Separate
Account A provided to the Company by the Insurer. A copy of such
investment policy may be obtained from the Company upon request to the
Company's Corporate Treasurer in the manner described under "Incorporation
of Certain Documents by Reference."
Investments in Separate Account A are represented by units. The number
of units acquired for an investment in Separate Account A or relinquished
upon a withdrawal from Separate Account A is determined based on the per
unit value of Separate Account A at the close of business on the date the
investment or withdrawal is made. The total dollar value of Separate
Account A is determined at the end of each business day, based on the
closing prices of the stocks then held in Separate Account A. The "value"
of a unit of interest in Separate Account A is determined at the close of
each business day by dividing the total dollar value of Separate Account A
at the close of such day by the total number of units in Separate Account
A.
Separate Account A is a separate account (not part of the Insurer's
General Account). Accordingly, realized and unrealized gains and losses
from the assets in Separate Account A are credited to or charged against
Separate Account A without regard to other income, gains or losses of the
Insurer.
While withdrawals from Separate Account A are normally processed within
seven days after receipt by the Insurer of a withdrawal request, the
Insurer reserves the right to defer payment for up to 270 days. When
transfers of more than $20 million are requested within any three year
period, the amount over $20 million may be transferred over a period of up
to three years.
For its services in managing Separate Account A, Invista is entitled to
receive an annual investment management fee. As of October 1, 1994, such
fee was equal to .45% of Separate Account A's assets, charged daily.
Invista reserves the right to change this fee at any time upon 30 days
advanced written notice. All expenses in connection with the purchase,
holding, or sale of securities for Separate Account A, as well as fees and
taxes associated with transfer of securities will be deducted from the
assets of Separate Account A or added to securities costs. These expenses
and the aforementioned investment management fee are reflected as a
reduction in the value of Separate Account A's units and are in addition to
the regular expenses associated with the Contract which are paid by the
Company.
15
Participants who elect to invest in this investment option will not
have any voting rights with respect to the shares in Separate Account A.
The voting rights with respect to such shares are vested in the Insurer.
Stocks as a category of securities are generally accepted as involving
more risk than many other types of investments. Any Participant
considering an investment in Separate Account A should evaluate the risks
involved. THERE IS NO GUARANTEE AS TO THE PERFORMANCE OF SEPARATE ACCOUNT
A. Stocks have high volatility, so the risk of decline in value at the time
cash is needed is greater than it is for most other types of investments.
While past results may be helpful in decision making, they cannot guarantee
future results.
The description of Separate Account A is a summary of information
concerning Separate Account A which has been provided to the Company by the
Insurer, and such description is qualified by reference to such information
which may be obtained from the Company by any Participant upon written or
oral request directed to the Company's Corporate Controller, Quaker
Chemical Corporation, Elm and Lee Streets, Conshohocken, Pennsylvania 19428
(610-832-4000).
IV. BOND & MORTGAGE FUND
This investment option is an account the assets of which are invested
in the Bond & Mortgage Account (Primart Separate Account), a pooled
investment account invested in intermediate-term fixed-income loans (the
"Bond & Mortgage Fund"). Principal Mutual Life Insurance Company
("Principal Life") owns and manages the assets of the Bond & Mortgage Fund.
All loans made by the Bond & Mortgage Fund are reviewed by the
Investment Committee of Principal Life and the Securities Division of its
Investment Department is responsible for the acquisition, sale and
continuing evaluation and supervision of all investments held in the Bond &
Mortgage Fund.
The objective of the Bond & Mortgage Fund is to obtain an above-average
rate of return in the lending market, with safety appropriate for
retirement plan assets, at the lowest possible expense level. The
investment objective is intended to be met over long periods of time
(several market cycles) and not over short periods of time such as one or
two years. However, Participants should understand that there can be no
assurance that the objective of the Bond & Mortgage Fund will be achieved
with respect to any investment period.
To meet its objective, the Bond & Mortgage Fund is invested primarily
in private market investments, such as private placement loans and
commercial mortgages. Private market investments have traditionally given
a premium yield over publicly-traded bonds. The Bond & Mortgage Fund may
also invest in Government National Mortgage Association (GNMA) pass-through
certificates and publicly-traded bonds. Short-term money instruments will
be used to keep funds fully invested.
The following table sets forth as of December 31, 1993, 1992 and 1991,
respectively, information provided to the Company by the Insurer concerning
the ending values of a single $10,000 invested in the Bond & Mortgage Fund
on the respective investment dates indicated:
ENDING VALUE AT
INVESTMENT DATE INVESTMENT PERIOD DECEMBER 31, 1993
--------------- ----------------- -----------------
January 1, 1993............. One Year $11,063
January 1, 1992............. Two Years 11,098
January 1, 1991............. Three Years 11,138
ENDING VALUE AT
INVESTMENT DATE INVESTMENT PERIOD DECEMBER 31, 1992
--------------- ----------------- -----------------
January 1, 1992............. One Year $10,825
January 1, 1991............. Two Years 12,545
January 1, 1990............. Three Years 13,736
ENDING VALUE AT
INVESTMENT DATE INVESTMENT PERIOD DECEMBER 31, 1991
--------------- ----------------- -----------------
January 1, 1991............. One Year $11,589
January 1, 1990............. Two Years 12,689
January 1, 1989............. Three Years 14,502
16
The Bond & Mortgage Fund does not attempt to anticipate short-term
changes in interest rates. However, long-term changes are considered in
structuring the portfolio. Modest trading takes place to take advantage of
anticipated rating changes, quality yield spreads and slope of the yield
curve. Other important considerations involved in the selection of
investments are frequency of payment, call protection, sinking fund
provisions, if any, and the conditions under which interest rates can be
adjusted.
The portfolio of the Bond & Mortgage Fund is structured so that it has
an intermediate-term average maturity long enough to provide higher
interest rates and short enough to allow for reinvestment of matured loans
at new rates.
Assets held in the Bond & Mortgage Fund are valued at the close of each
business day based on their market value, using a computer valuation system
provided by an outside securities valuation service. Investments in the
Bond & Mortgage Fund are represented by units and the number of units
acquired for each investment or relinquished upon each withdrawal is
determined based on the Bonds & Mortgage Fund's per unit value at the close
of business on the date the investment is made. Since the Bond & Mortgage
Fund is a separate account (not part of Principal Life's General Account),
realized and unrealized gains and losses from assets in the Bond & Mortgage
Fund are credited to or charged against the Bond & Mortgage Fund without
regard to other income, gains, or losses of Principal Life.
While withdrawals from the Bond & Mortgage Fund are normally processed
within seven days after receipt by Principal Life of a withdrawal request,
Principal Life reserves the right to defer payment for up to 270 days.
For its services in managing the Bond & Mortgage Fund, Principal Life
is entitled to receive an annual investment management fee which is not
paid by the Company but is charged daily against the Bond & Mortgage Fund's
assets. As of October 1, 1994, such fee was equal to .45% of the Fund's
assets. Principal Life reserves the right to change this fee at any time
upon 30 days advance written notice. The investment management fee is
reflected as a reduction in the unit value of the Bond & Mortgage Fund and
is in addition to the regular expenses of the Contract which are paid by
the Company.
THE BOND & MORTGAGE FUND IS A MARKET-VALUED FUND AND PROVIDES NO
GUARANTEE OF INVESTMENT PERFORMANCE. SINCE MARKET VALUE CHANGES CAN RESULT
IN WIDELY FLUCTUATING RETURNS OVER A SHORT PERIOD OF TIME, THE BOND &
MORTGAGE FUND IS BEST USED FOR LONG-TERM INVESTMENT.
The description of the Bond & Mortgage Fund is a summary of information
concerning the Bond & Mortgage Fund which has been provided to the Company
by the Insurer, and such description is qualified by reference to such
information which may be obtained from the Company by any Participant upon
written or oral request directed to the Company's Corporate Controller,
Quaker Chemical Corporation, Elm and Lee Streets, Conshohocken,
Pennsylvania 19428 (610-832-4000).
VALUATION OF THE FUND
The Plan provides for the determination by the Trustee and Insurer, as
of each Anniversary Date, and as of such other date or dates deemed
necessary by the Administrator (each a "Valuation Date"), of the net worth
of the assets comprising the Fund and the Contract as it exists on the
Valuation Date, prior to taking into consideration any contribution to be
allocated for that Plan Year and Contract. In determining such net worth,
the assets comprising the Fund and the Contract are to be included at their
fair market value as of the Valuation Date and all expenses for which the
Trustee and Insurer have not yet obtained reimbursement from the Employer
or the Fund are to be deducted.
In determining the fair market value of securities held in the Fund
which are listed on a registered stock exchange, such shares are to be
valued at the price they were last traded on such exchange preceding the
close of business on the Valuation Date. If such securities were not
traded on the Valuation Date, or if the exchange on which they are traded
was not open for business on the Valuation Date, then the securities are to
be valued at the prices at which they were last traded prior to the
Valuation Date. Any unlisted security held in the Fund is to be valued at
its bid price next preceding the close of business on the Valuation Date.
In determining the fair market value of assets other than securities for
which trading or bid prices can be obtained, the Trustees and Insurer may
appraise such assets themselves, or in their discretion, employ one or more
appraisers for that purpose and rely on the values established by such
appraiser or appraisers.
17
VESTING
A Participant will be 100% vested in all amounts allocated to his
Account at all times. The computation of a Participant's nonforfeitable
percentage of his interest in the Plan may not be reduced as the result of
any direct or indirect amendment to the Plan. For this purpose, the Plan
will be treated as having been amended if the Plan provides for an
automatic change in vesting due to a change in top heavy status. In the
event that the Plan is amended to change or modify any vesting schedule, a
Participant with at least three Years of Service as of the expiration date
of the below-described election period may elect to have his nonforfeitable
percentage computed under the Plan without regard to such amendment. In
such event, if a Participant fails to make such an election, such
Participant will be subject to the new vesting schedule. The election
period referred to in the preceding sentence will commence on the date of
adoption of an amendment and end 60 days after the latest of (i) such date
of adoption, (ii) the effective date of the amendment, or (iii) the date
the Participant receives written notice of the amendment from the Employer
or the Administrator.
BENEFITS UNDER THE PLAN
Retirement Benefits. Under the terms of the Plan, on a Participant's
Retirement Date, all amounts credited to such Participant's account under
the Plan become distributable in accordance with the provisions of the
Plan. Upon a Participant's Retirement Date, or as soon thereafter as is
practicable, the Trustee and Insurer are obligated to distribute all
amounts credited to such Participant's Account in accordance with the
provisions of the Plan.
Death Benefits. Upon the death of a Participant before his Retirement
Date or other termination of his employment, all amounts credited to his
Combined Account shall be distributed, in accordance with the provisions of
the Plan to the deceased Participant's Beneficiary. Upon the death of a
Former Participant, the Administrator shall direct the Trustee and Insurer
to distribute any remaining amounts credited to the accounts of a deceased
Former Participant to such Former Participant's Beneficiary. In
determining the amount of the death benefit, any security interest held by
the Plan by reason of an outstanding loan to the Participant or Former
Participant will be taken into account. The Administrator may require such
proper proof of death and such evidence of the right of any person to
receive payment of the value of the account of a deceased Participant or
Former Participant as the Administrator may deem desirable. The
Administrator's determination of death and of the right of any person to
receive payment shall be conclusive.
With certain limited exceptions, the Beneficiary of the death benefit
payable pursuant to the Plan shall be the Participant's spouse. The
Participant may designate a Beneficiary other than his spouse in accordance
with the terms of the Plan if (i) the spouse has waived the right to be the
Participant's Beneficiary in accordance with the terms of the Plan, or (ii)
the Participant is legally separated or has been abandoned (within the
meaning of local law) and the Participant has a court order to such effect
(and there is no "qualified domestic relations order" as defined in Code
Section 414(p) which provides otherwise), or (iii) the Participant has no
spouse, or (iv) the spouse cannot be located. A Participant may at any
time revoke his designation of a Beneficiary or change his Beneficiary by
filing written notice of such revocation or change with the Administrator,
subject to the written consent of the Participant's spouse unless the
original consent of the spouse acknowledges that the spouse has the right
to limit consent only to a specific Beneficiary and the spouse voluntarily
elects to relinquish such right. In the event no valid designation of
Beneficiary exists at the time of the Participant's death, the death
benefit shall be payable to his estate.
Disability Benefits. In the event of a Participant's Total and
Permanent Disability prior to his Retirement Date or other termination of
his employment, the Trustee and Insurer, in accordance with the provisions
of the Plan, are required to distribute to such Participant all amounts
credited to such Participant's Combined Account as though he had retired.
Benefits Upon Termination. On or before the Anniversary Date
coinciding with or subsequent to the termination of a Participant's
employment for any reason other than death, Total and Permanent Disability
or retirement, the Administrator may direct the Trustee or Insurer to
segregate such Terminated Participant's Combined Account and invest the
aggregate amount thereof in a separate, federally insured savings account,
certificate of deposit, common or collective trust fund of a bank or a
deferred annuity. In the event the Participant's Combined Account is not
segregated, the amount shall remain in a separate account for the
Terminated Participant and share in allocations pursuant to the Plan until
such time as a distribution is made to the Terminated Participant.
18
In the event that the amount of the Terminated Participant's Combined
Account equals or exceeds the fair market value of any insurance contracts
of the Terminated Participant, the Trustee or Insurer, when so directed by
the Administrator and agreed to by the Terminated Participant, shall
assign, transfer, and set over to such Terminated Participant all contracts
on his life in such form or with such endorsements so that the settlement
options and forms of payment are consistent with the provisions of the Plan
relating to the distribution of benefits. In the event that the Terminated
Participant's Combined Account does not at least equal the fair market
value of the contracts of the Terminated Participant, if any, the
Terminated Participant may pay over to the Trustee or Insurer the sum
needed to make the distribution equal to the value of the contracts being
assigned or transferred, or the Trustee or Insurer, pursuant to the
Participant's election, may borrow the cash value of the Contracts from the
insurer so that the value of the Contracts is equal to the Vested portion
of the Terminated Participant's Account and then assign the contracts to
the Terminated Participant.
Distribution of the funds due to a Terminated Participant shall be made
on the occurrence of an event which would result in the distribution had
the Terminated Participant remained in the employ of the Employer (upon the
Participant's death, Total and Permanent Disability or Retirement).
DISTRIBUTION OF BENEFITS
General. At the election of the Participant, any amount to which he is
entitled under the Plan will be distributable in one lump-sum payment in
cash. However, a Participant or Terminated Participant becoming eligible
to receive benefits may request that, in lieu of a lump-sum distribution,
his interest be paid in installments over a fixed period if such payments
do not constitute an "annuity" within the meaning of Section 205 of Title I
of the Act or Section 401(a) of the Code. If the Administrator agrees to
make such installment distributions in its discretion, the following rules
shall apply:
(i) The payment period shall not exceed the life expectancy of the
Participant at the time of benefit commencement; or, if the Participant
is married at the time of benefit commencement, the joint life expectancy
of the Participant and his spouse;
(ii) Payments shall be made in installments which are as nearly
equal as possible, and shall be made not less frequently than annually
nor more frequently than monthly, as determined by the Administrator; and
(iii) At any time during the installment period, the Administrator
may accelerate the remaining installments by paying the balance of such
account to the distributee.
Any distribution to a Participant who has a benefit which exceeds, or has
ever exceeded, $3,500 at the time of any prior distribution shall require such
Participant's consent if such distribution occurs prior to his Normal
Retirement Age.
Subject to applicable provision of the Code and the Regulations
thereunder, and except as otherwise required by the Plan, a Participant's
benefits generally are to be distributed to him not later than April 1 of the
calendar year following the calendar year in which the Participant attains age
70-1/2. A Participant's benefits are to be distributed to him not later than
April 1 of the calendar year following the later of (i) the calendar year in
which the Participant attains age 70-1/2 or (ii) the calendar year in which the
Participant retires, provided, however, that this clause (ii) shall not apply
in the case of a Participant who is a "five (5) percent owner" at any time
during the five (5) Plan Year period ending in the calendar year in which he
attains age 70-1/2 or, in the case of a Participant who becomes a "five (5)
percent owner" during any subsequent Plan Year, clause (ii) shall no longer
apply and the required beginning date shall be April 1 of the calendar year
following the calendar year in which such subsequent Plan Year ends.
Notwithstanding the foregoing, clause (ii) above shall not apply to any
Participant unless the Participant had attained age 70-1/2 before January 1,
1988 and was not a "five (5) percent owner" at any time during the Plan Year
ending with or within the calendar year in which the Participant attained age
66-1/2 or any subsequent Plan Year.
Distributions to a Participant and his Beneficiaries shall only be made
in accordance with the incidental death benefit requirements of Code Section
401(a)(9)(G) and the Regulations thereunder.
Any annuity contract acquired pursuant to the Plan shall be
non-transferable when distributed. Furthermore, the terms of any annuity
contract purchased and distributed to a Participant or spouse shall comply
with all of the requirements of the Plan.
19
Any Participant, Terminated Participant or Beneficiary may direct the
Administrator to authorize the Trustee or Insurer to pay any "eligible
rollover distribution" (as defined in Code Section 402(f)(2)(A)) otherwise
payable to the Participant, Terminated Participant or Beneficiary pursuant to
the Plan to any "eligible retirement plan" (as defined in Code Section
401(a)(31)(D)).
Death Benefits. Except as otherwise required by the Code and the
Regulations thereunder and the Plan, death benefit payable pursuant to the
Plan will be paid to the Participant's Beneficiary in one lump-sum payment in
cash. If a Participant dies after the distribution of his interest has begun
and before his entire interest has been distributed to him, the remaining
portion of such interest will be distributed at least as rapidly as under the
method of distribution being utilized as of his date of death. If a
Participant dies before he has begun to receive any distributions of his
interest under the Plan or before distributions are deemed to have begun
pursuant to Regulations, then his death benefit will be distributed to his
Beneficiaries no later than December 31 of the calendar year in which the
fifth anniversary of his date of death occurs.
Except as otherwise required by the Plan, whenever the Trustee or Insurer
is to make a distribution on or as of an Anniversary Date, the Plan provides
that the distribution shall be made on such date or as soon thereafter as is
practicable. However, unless a Former Participant elects in writing to defer
the receipt of benefits (such election may not result in a death benefit that
is more than incidental), the payment of benefits shall commence not later
than the 60th day after the close of the Plan Year in which the latest of the
following events occurs: (i) the date on which the Participant attains the age
of 65; (ii) the 10th anniversary of the year in which the Participant
commenced participation in the Plan; or (iii) the date the Participant
terminates his service with the Employer.
In the event that all, or any portion, of the distribution payable to a
Participant or his Beneficiary hereunder shall, at the later of the
Participant's attainment of age 62 or his Normal Retirement Age, remain unpaid
solely by reason of the inability of the Administrator, after sending a
registered letter, return receipt requested, to the last known address, and
after further diligent effort, to ascertain the whereabouts of such
Participant or his Beneficiary, the amount so distributable shall be forfeited
and treated as an additional Employer Profit-Sharing contribution and
allocated pursuant to the Plan. In the event a Participant or Beneficiary is
located subsequent to his benefit being reallocated, such benefit shall be
restored.
Qualified Domestic Relations Orders. All rights and benefits, including
elections, provided to a Participant in the Plan will be subject to the rights
afforded to any "alternate payee", as defined in the Code, under a "qualified
domestic relations order", as defined in the Code. Furthermore, a
distribution to an "alternate payee" will be permitted if such distribution is
authorized by a "qualified domestic relations order," even if the affected
Participant has not reached the "earliest retirement age" under the Plan.
Hardship Distributions. Distributions of Elective Contributions in the
minimum amount of $1,000 may be made to a Participant in the event of an
immediate and heavy financial need of the Participant where such Participant
lacks other available resources (a "hardship distribution"). A hardship
distribution is subject to the spousal consent requirements contained in
Sections 401(a)(11) and 417 of the Code, if applicable.
The following are the only financial needs which will be deemed immediate
and heavy for purposes of determining whether the basis for a hardship
distribution exists: (i) expenses incurred or necessary for medical care,
described in Section 213(d) of the Code, of the Participant, the Participant's
spouse, children, or dependents; (ii) the purchase (excluding mortgage
payments) of a principal residence for the Participant; (iii) payment of
tuition and related educational fees for the next 12 months of post-secondary
education for the Participant, the Participant's spouse, children or
dependents; or (iv) the need to prevent the eviction of the Participant from,
or a foreclosure on the mortgage of, the Participant's principal residence. A
distribution will be considered as necessary to satisfy an immediate and heavy
financial need of the Participant only if:
(i) The Participant has obtained all distributions, other than
hardship distributions, and all nontaxable loans under all plans
maintained by the Employer;
(ii) All plans maintained by the Employer provide that the
Participant's Elective Contributions (and any Employee Contributions)
will be suspended for twelve months after the receipt of the hardship
distribution;
(iii) The distribution is not in excess of the amount of an
immediate and heavy financial need (including amounts necessary to pay
any federal, state or local income taxes or penalties reasonably
anticipated to result from the distribution); and
20
(iv) All plans maintained by the Employer provide that the Employee
may not make Elective Contributions for the Participant's taxable year
immediately following the taxable year of the hardship distribution in
excess of the applicable limit under Section 402(g) of the Code for such
taxable year less the amount of such Participant's Elective Contributions
for the taxable year of the hardship distribution.
WITHDRAWALS OF PROFIT-SHARING CONTRIBUTIONS
Each Participant has the right to elect, in writing on forms provided by
the Administrator, to withdraw (i) 100%, (ii) 50% or (iii) no part of that
portion of any Profit-Sharing Contribution allocated to his or her Account in
respect of such Plan Year provided the effective date of such election is
within two (2) years of such Plan Year. Such right of withdrawal will not be
available with respect to any Profit-Sharing Contributions made on account of
Plan Years ending on or after January 1, 1992. Permitted withdrawals are to
be made in cash as promptly as practicable after the end of the Plan Year in
which the election is made. Such amount to be adjusted (as of the last day of
the calendar year preceding the date of the withdrawal) to the fair market
value of the assets of the Fund attributable to such deferred, allocated
amount. To be effective, a withdrawal election must be made on or before the
November 30 preceding the date of the withdrawal. Failure to timely file a
written election with respect to a withdrawal for a Plan Year will constitute
a binding election to waive the right of withdrawal.
LOANS TO PARTICIPANTS
Subject to such uniform and nondiscriminatory rules as may from time to
time be adopted by the Administrator, after it has been determined that loans
to Participants shall be allowed, the Trustee or Insurer, upon direction from
the Administrator, may make a loan or loans to a Participant for the purpose
of enabling the Participant to meet financial needs of the Participant which
are deemed to be immediate and heavy, as described under "Hardship
Distributions", above. Any loan pursuant to the Plan is to be in the amount
of not less than $1,000, for a non-renewable and non-extendable term of not
more than three years and amortized in level payments not less frequently than
quarterly.
A Participant's loan (when added to the outstanding balance of all of the
Participant's other loans from the Plan) will be limited to the lesser of: (1)
$50,000 reduced by the excess, if any, of the highest outstanding balance of
loans during the one year period ending on the day before the loan is made
over the outstanding balance of loans on the date the loan is made or (2) the
greater of one-half (1/2) of the vested interest in the Participant's Accounts
as of the date on which the loan is made or $10,000. Notwithstanding the
foregoing, no Participant shall, under any circumstance, be entitled to loans
in excess of one-half (1/2) of the vested interest in such Participant's
Accounts as of the Valuation Date coincident with or immediately preceding the
date on which the loan is made, reduced by any amounts withdrawn from such
Account since the Valuation Date of reference. To the extent that a
Participant loan exceeds the aforementioned limitation, such excess amounts
will be treated as a taxable distribution to the Participant. Any amount
withdrawn by a Participant while a loan is outstanding, and any amount
becoming distributable to a Participant or beneficiary while a loan is
outstanding against the Account from which such distribution is to be made,
shall be immediately applied to reduce the amount of accrued interest and the
principal amount of such loan.
For purposes of the aforementioned limitation on the amount of
Participant loans, loans from the Plan are deemed to include all loans from
all other plans maintained by the Employer or by any other entity which,
together with the Employer, constitute elements of either: (i) a controlled
group of corporations (within the meaning of Section 414(b) of the Code); (ii)
a group of trades or businesses under common control (within the meaning of
Section 414(c) of the Code); or (iii) an affiliated service group (within the
meaning of Section 414(m) of the Code).
With the exception of reasonable distinctions among prospective borrowers
on the basis of credit worthiness, any loans to Participants are to be made on
a reasonably equivalent basis. Loans shall not be made available to highly
compensated Participants in an amount greater than the amount available to
other Participants. Thus, the same percentage of a Participant's Account
balance may be loaned to Participants with large and small Account balances,
if such Account is security (or partial security) for repayment of the loan.
All loans to Participants will be considered fixed income investments of
the Trust Fund. Accordingly, all loans to Participants made by the Trustee
are required to be secured by the pledge of no more than one-half of the
Participant's interest in the Trust Fund and by the pledge of such further
collateral as the Trustee or Insurer, in its discretion, deems necessary to
assure repayment of the borrowed amount and all interest to be accrued thereon
in
21
accordance with the terms of the loan. Interest will be charged at a
reasonable rate comparable to the prevailing rate of interest charged for
similar loans by lending institutions in the community on the date of the loan
subject to applicable legal limits. To the extent a Participant or
beneficiary becomes entitled to payments of benefits or withdraws all or a
portion of the borrower's Account, the payments or withdrawals, as the case
may be, are required to be applied immediately against the balance
outstanding. If not paid as and when due, the outstanding balance of a loan
may be deducted from any benefit which is or becomes payable to the borrower
or a beneficiary, and any other security pledged may be sold by the Trustee at
public or private sale as soon as is practicable after such default. A
Participant will remain liable for any deficiency remaining after application
of any sale proceed in the manner provided in the Plan.
ASSIGNMENT; LIENS
A Participant or his beneficiary may not alienate, sell, transfer,
assign, pledge, encumber or charge his interest in the Plan. No interest in
the Plan may be attached or subjected to other legal process except to the
extent provided in the Plan or as may be required by law. Pursuant to the
Retirement Equity Act of 1984 amending Section 401(a)(13) of the Code, a
"qualified domestic relations order" will not be treated as an illegal
assignment or attachment. In addition, an Internal Revenue Service levy on an
Account will not be considered an illegal assignment or attachment.
AMENDMENT AND TERMINATION
Subject to the limitations set forth in the Plan, the Company may amend
the Plan at any time. No amendment to the Plan will be effective if it
authorizes or permits any part of the Trust Fund (other than such part as is
required to pay taxes and administration expenses) to be used for or diverted
to any purpose other than for the exclusive benefit of the Participants or
their Beneficiaries or estates, or causes any reduction in the amount credited
to the Account of any Participant, or causes or permits any portion of the
Fund to revert to or become property of the Employer. Except as permitted by
the Regulations, no Plan amendment or transaction having the effect of a Plan
amendment (such as a merger, plan transfer or similar transaction) will be
effective if it eliminates or reduces any "Section 411(d)(6) protected
benefit" (i.e., a benefit described in Code Section 411(d)(6)(A), an early
retirement benefit or a retirement-type subsidy or optional form of benefit)
or adds or modifies conditions relating to a "Section 411(d)(6) protected
benefit" the result of which is a further restriction on such benefit unless
such protected benefit is preserved with respect to benefits accrued as of the
later of the adoption date or effective date of the amendment.
While the Company anticipates that the Plan will continue indefinitely as
a qualified plan under the Code, it reserves the right to terminate the Plan
at any time by action of the Board of Directors of the Company. Upon any full
or partial termination of the Plan, all amounts credited to the affected
Participants' Accounts will be 100% vested and may not thereafter be subject
to forfeiture, and any unallocated amounts will be allocated to the Accounts
of all Participants in accordance with the provisions of the Plan. Upon the
full termination of the Plan, the Company will direct the distribution of the
assets of the Fund to Participants in accordance with the terms of the Plan.
Such distributions will be made in cash or through the purchase of irrevocable
nontransferable deferred commitments from an insurer. Except as permitted by
the Regulations, the termination of the Plan may not result in the reduction
of any "Section 411(d)(6) protected benefit".
REFERENCE TO THE PLAN
The above summary of the Plan does not purport to be complete and is
subject in all respects to the provisions of the Plan, a copy of which is
available from the Company on request and which has been filed with the
Securities and Exchange Commission as an exhibit to the Company's Registration
Statement of which this Prospectus is a part. (SEC File No. 33-54158).
FEDERAL TAX ASPECTS
The Company intends to submit the Plan to the IRS to seek its
determination that the Plan, as amended and restated meets the requirements of
a qualified profit sharing plan under Section 401(a) of the Code, a qualified
cash or deferred arrangement under Section 401(k) of the Code and that the
Trust is exempt from Federal income tax under Section 501(a) of the Code. The
IRS could request further amendments to the Plan, and could condition any
22
determination letter upon timely adoption of such amendments. So long as the
Code requirements continue to be met, the amounts contributed by the Company
on behalf of a Participant will be deductible by the Company for Federal
income tax purposes and amounts contributed by the Company as Elective
Contributions on behalf of a Participant who has executed a salary reduction
agreement will be excluded from the Participant's gross income. Contributions
made on a Participant's behalf and the income and appreciation on Employer
contributions will not be subject to income tax while held by the Insurer or
in the Trust Fund and will not be includable in the Participant's taxable
income until distributed to him.
If an amount in a Participant's Account is withdrawn, the amount
withdrawn will be taxable to him as ordinary income (except for certain lump
sum distributions made after a member has attained age 59-1/2). Any withdrawal
prior to age 59-1/2 will also be subject to a 10% excise tax unless an
exemption from such excise tax is applicable. If a Participant rolls the
distribution over into an IRA or another eligible qualified plan, the excise
tax will not be imposed on the portion of the distribution that is rolled
over. The excise tax also will not be imposed if the Participant is over age
59-1/2 when the distribution is received, or if he is over age 55 and has
retired. Any distribution made after the death of the Participant is exempt
from the 10% excise tax regardless of the age of the Participant. Also, any
distribution to a spouse, former spouse, child or other dependent of the
Participant pursuant to a qualified domestic relations order will be exempt
from the excise tax.
Upon distribution of a Participant's entire Account in a lump sum by
reason of his death or other termination of employment, or after his
attainment of age 59-1/2, the distribution will constitute taxable (ordinary)
income to the Participant which may qualify for special five-year forward
income averaging if the Participant has been a Participant in the Plan for
five or more taxable years. The availability of the election to be taxed
under the five-year forward averaging provision is subject to a number of
limitations including the limitations that the election be made only once, and
that it be made only after attaining age 59-1/2. Certain Participants who
attained the age of 50 before January 1, 1986 may elect to be taxed under
ten-year forward income averaging as in effect immediately prior to the
adoption of the Tax Reform Act of 1986.
If a Participant receives a lump sum distribution from the Plan by reason
of termination of employment or termination of the Plan or after attainment of
age 59-1/2, he may transfer on or before the 60th day after the day on which he
receives such distribution, all or part of the distribution to: (i) another
exempt employees' trust which as part of a "qualified" plan for Federal income
tax purposes, (ii) an "annuity" plan described in Section 401(a) of the Code
or (iii) an "individual retirement account" or an "individual retirement
annuity" as such terms are described in the Code, and thereby avoid current
taxation of the portion of the distribution so transferred. Moreover, if the
spouse of a Participant receives a lump sum distribution by reason of the
Participant's death, the spouse may transfer, within the period described in
the preceding sentence, all or a portion of such distribution to an
"individual retirement plan" and thereby avoid current taxation on the portion
of the distribution so transferred.
If a Participant is entitled to receive a lump sum distribution from the
Plan as described above, the Participant may direct the Administrator to
request that the Insurer and Trustee pay such distribution directly to the
trustee or custodian of another qualified retirement plan or individual
retirement account. Effective January 1, 1993, the Company is required to
impose income tax withholding on all lump sum distributions unless such
distributions are paid directly to another qualified retirement plan or
individual retirement account. The amount of withholding required will equal
20% of the amount distributed and will be imposed even if the Participant
subsequently elects to transfer such distribution to a qualified retirement
plan or individual retirement plan.
If a distribution during a calendar year to a Participant exceeds
$150,000, it may be subject to a 15% excise tax on the portion of the
distribution that is in excess of that amount. In determining whether the
$150,000 threshold has been reached, all distributions from all "qualified"
plans, certain similar types of plans, and IRAs are aggregated. The $150,000
amount is subject to cost of living adjustments, and also may be a different
amount for certain individuals who filed a "grandfather election" with their
1988 federal income tax returns. The excise tax on any lump sum distribution
from the Plan that is made on account of termination of employment or
termination of the Plan, or that is made after attainment of age 59-1/2, may be
avoided for the year of distribution by rolling the distribution over into
another "qualified" plan, "annuity" plan or IRA on or before the 60th day
after receipt of the distribution.
23
With respect to Federal estate tax, distributions under the Plan made as
a result of the death of a Participant or former Participant will generally be
included in determining the taxable amount of the Participant's estate.
However, amounts payable to the deceased Participant's spouse may be eligible
for the Federal estate tax marital deduction. For Federal income tax
purposes, amounts distributed to the beneficiary or estate of a Participant
will be treated in substantially the same way as if distributed to a
Participant after termination of employment.
If a Participant dies with an accumulation that exceeds a threshold
determined under Section 4980A of the Code, the Participant's estate may be
subject to a 15% excise tax on the amount of the "excess accumulation." This
excise tax cannot be avoided by a rollover to an IRA, although in certain
circumstances the Participant's surviving spouse may have the right, if the
spouse is the beneficiary of substantially all of the Participant's
"qualified" plan, "annuity" plan and IRA death benefits, to make an election
to convert the Participant's accumulation to the spouse's distribution for
purposes of this excise tax. In the event that the spouse makes such an
election and then receives a lump sum distribution, the spouse may avoid the
excise tax for the year of distribution by rolling the distribution over into
an IRA on or before the 60th day after receipt of the distribution. Spousal
rollovers to other "qualified" or "annuity" plans are not permitted.
The foregoing description of tax effects is intended to be general in
nature, and is based on interpretations of present Federal statutory and
regulatory authority which may be subject to change. Each Participant should
discuss specific questions with his own tax adviser or attorney. In addition,
there may be tax considerations under foreign, state and local laws applicable
to Participants.
Any material changes in the tax effects of participation in the Plan will
be described in a Supplement to this Prospectus.
APPLICABLE REQUIREMENTS OF ERISA
The Plan is a "defined contribution plan" as described in Section 3(34)
of ERISA. As such, the Plan is subject to the applicable provisions set forth
in Part 1 (Reporting and Disclosure), Part 2 (Participation and Vesting), Part
4 (Fiduciary Responsibility) and Part 5 (Administration and Enforcement) of
Subtitle B of Title I of ERISA which relate to employee pension benefit plans
which are defined contribution plans.
The Plan is not subject to Part 3 (Funding) of Subtitle B of Title I of
ERISA nor is it subject to any of the provisions of Title IV of ERISA. Those
portions of ERISA pertain to "money purchase plans" and "defined benefit
plans."
AMENDMENTS AND OTHER CHANGES AFFECTING THIS PROSPECTUS
After the date hereof, the Plan may from time to time be amended and
certain other changes in respect of the Plan, such as changes in applicable
law, may also occur. Any such amendments or changes that are material for
purposes of this Prospectus shall be reflected in a Supplement to this
Prospectus.
REPORTS OF THE COMPANY
The Company's Quarterly and Annual Reports to Stockholders, proxy
soliciting material and other communications distributed to the Company's
stockholders generally will be provided to all Participants of the Plan
whether or not such Participants are stockholders of the Company. If a
Participant does not for some reason receive a copy of any such reports,
material or other communications, he may obtain copies of the same which the
Company will provide promptly without charge upon written or oral request made
to the Company's Corporate Treasurer in the manner described under
"Incorporation of Certain Documents by Reference."
24
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission are incorporated in the
Prospectus by reference:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1993 filed pursuant to Section 13(a) of the Exchange
Act;
(b) The Company's Quarterly Reports on Form 10-Q for the fiscal
quarters ended March 31, 1994 and June 30, 1994, respectively, filed
pursuant to Section 13(a) of the Exchange Act;
(c) All other reports of the Company filed pursuant to Section 13 or
15(d) of the Exchange Act since June 30, 1994;
(d) The Company's definitive proxy statement dated March 31, 1994
filed pursuant to Section 14 of the Exchange Act in connection with the
Company's 1994 Annual Meeting of Stockholders;
(e) The description of the Common Stock contained in the Company's
Form 8-A Registration Statement dated April 27, 1973 and any amendments
or reports filed for the purpose of updating such description; and
(f) The Plan's Annual Report on Form 11-K for the fiscal year ended
December 31, 1993 filed pursuant to Section 15(d) of the Exchange Act.
All documents filed by the Company or the Plan pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the filing of a post-effective amendment which
indicates that all securities offered hereby have been sold or which
deregisters all securities offered hereby then remaining unsold shall be
deemed to be incorporated herein by reference and to be a part hereof from the
date of filing of such documents.
Copies of the documents incorporated by reference herein, except for the
exhibits to such documents (unless such exhibits are specifically incorporated
by reference into the documents which this Prospectus incorporates), and
copies of any other documents to which a Participant is entitled as described
in this Prospectus, are available to any Participant receiving a copy of this
Prospectus upon written or oral request. Such request should be directed to
the Company's Corporate Controller, Quaker Chemical Corporation, Elm and Lee
Streets, Conshohocken, Pennsylvania 19428 (610-832-4000). See "Additional
Information."
EXPERTS
The financial statements incorporated by reference to the Company's
Annual Report on Form 10-K for the year ended December 31, 1993 have been so
incorporated in reliance on the report (which contains an explanatory
paragraph relating to a change in the method of accounting for income taxes
and postretirement benefits other than pensions as discussed in Notes 5 and 6
to the financial statements) of Price Waterhouse LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.
25
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26
==================================== =====================================
NO PERSON IS AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH
THE OFFER MADE BY THIS PROSPECTUS
OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATION
MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER TO
SELL OR A SOLICITATION OF AN OFFER
TO BUY ANY OF THESE SECURITIES IN
ANY STATE TO ANY PERSON TO WHOM IT
IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION IN SUCH STATE.
----------------
TABLE OF CONTENTS
PAGE QUAKER CHEMICAL
---- CORPORATION
Additional Information......... 2
General Information............ 2
Definitions.................... 3
The Plan....................... 7
General...................... 7
Purpose...................... 7
Administration............... 7 -----------
Eligibility.................. 8
Contributions................ 8 QUAKER CHEMICAL CORPORATION
Rollover Contributions....... 10 PROFIT SHARING AND RETIREMENT
Limitations on Contributions. 10 SAVINGS PLAN
Change of Contributions...... 10
Accounts..................... 11 ------------
Investment of Contributions.. 11
Description of Investment PROSPECTUS
Options.................... 11 ------------
Valuation of the Fund........ 17
Vesting...................... 18
Benefits Under the Plan...... 18
Distribution of Benefits..... 19
Withdrawals of Profit-Sharing
Contributions................ 21
Loans to Participants........ 21
Assignment; Liens............ 22
Amendment and Termination.... 22
Reference to the Plan........ 22
Federal Tax Aspects............ 22
Applicable Requirements
of ERISA..................... 24
Amendments and Other Changes
Affecting this Prospectus.... 24
Reports of the Company......... 24
Incorporation of Certain
Documents By Reference....... 25
Experts........................ 25
----------------
NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL UNDER ANY OCTOBER 28, 1994
CIRCUMSTANCES CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE
COMPANY OR THE PLAN SINCE THE DATE
HEREOF.
==================================== =====================================
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
Reference is made to the information appearing under the heading
"Incorporation of Certain Documents by Reference" in the Prospectus
constituting a part of this Registration Statement, which information is
incorporated herein by this reference.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Subchapter D of Chapter 17 of the Pennsylvania Business Corporation Law
of 1988 provides as follows:
Section 1741. Third Party Actions. Unless otherwise restricted in
its bylaws, a business corporation shall have the power to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an action by
or in the right of the corporation) by reason of the fact that he is or
was a representative of the corporation, or is or was serving at the
request of the corporation as a representative of another domestic or
foreign corporation for profit or not-for-profit, partnership, joint
venture, trust or other enterprise, against expenses (including
attorney's fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action,
suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of
the corporation, and with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order,
settlement or conviction or upon a plea of nolo contendere or its
equivalent shall not of itself create a presumption that the person did
not act in good faith and in a manner which he reasonably believed to be
in, or not opposed to, the best interests of the corporation, and, with
respect to any criminal action or proceeding, had reasonable cause to
believe that his conduct was unlawful.
Section 1742. Derivative actions. Unless otherwise restricted in
its bylaws, a business corporation shall have power to indemnify any
person who was or is a party, or is threatened to be made a party, to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that
he is or was a representative of the corporation or is or was serving at
the request of the corporation as a representative of another domestic or
foreign corporation for profit or not-for-profit, partnership, joint
venture, trust or other enterprise against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection with the
defense or settlement of such action or suit if he acted in good faith
and in a manner he reasonably believed to be in, or not opposed to, the
best interests of the corporation. Indemnification shall not be made
under this section in respect of any claim, issue or matter as to which
such person shall be adjudged to be liable to the corporation unless and
only to the extent that the court of common pleas of the county in which
the registered office of the corporation is located or the court in which
such action or suit was brought determines upon application that, despite
the adjudication of liability but in view of all the circumstances of the
case, such person is fairly and reasonably entitled to indemnity for such
expenses which the court of common pleas or such other court shall deem
proper.
Section 1743. Mandatory indemnification. To the extent that a
representative of a business corporation has been successful on the
merits or otherwise in defense of any action, suit or proceeding referred
to in Section 1741 or 1742 or in defense of any claim, issue or matter
therein, he shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection therewith.
II-1
Section 1744. Procedure for effecting indemnification. Unless
ordered by a court, any indemnification under section 1741 or 1742 shall
be made by the business corporation only as authorized in the specific
case upon determination that indemnification of the representative is
proper in the circumstances because he has met the applicable standard of
conduct set forth in such subsection. The determination shall be made:
(1) by the board of directors by a majority vote of a quorum
consisting of directors who were not parties to such action or
proceeding; or
(2) if such a quorum is not obtainable, or, even if obtainable
and a majority vote of a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion; or
(3) by the shareholders.
Section 1745. Advancing expenses. Expenses (including attorney's
fees) incurred in defending any action or proceeding referred to in this
subchapter may be paid by a business corporation in advance of the final
disposition of the action or proceeding upon receipt or an undertaking by
or on behalf of the representative to repay the amount if it is
ultimately determined that he is not entitled to be indemnified by the
corporation as authorized in this subchapter or otherwise.
Section 1746. Supplementary coverage.
(a) General Rule. The indemnification and advancement of expenses
provided by, or granted pursuant to, the other sections of this
subchapter shall not be deemed exclusive of any other rights to which a
person seeking indemnification or advancement of expenses may be entitled
under any by-law, agreement, vote of shareholders or disinterested
directors or otherwise, both as to action in his official capacity and as
to action in another capacity while holding such office. Sections 1728
(relating to interested directors or officers; quorum) and 1770 (relating
to interested shareholders) shall be applicable to any bylaw, contract or
transaction authorized by the directors under this section. A
corporation may create a fund of any nature, which may, but need not be,
under the control of a trustee, or otherwise secure or insure in any
manner its indemnification obligations, whether arising under or pursuant
to this section or otherwise.
(b) When indemnification is not made. Indemnification pursuant to
subsection (a) shall not be made in any case where the act or failure to
act giving arise to the claim for indemnification is determined by a
court to have constituted willful misconduct or recklessness. The
articles may not provide for indemnification in the case of willful
misconduct or recklessness.
(c) Grounds. Indemnification pursuant to subsection (a) under any
bylaw, agreement, vote of shareholders or directors or otherwise, may be
granted for any action taken or any failure to take any action and may be
made whether or not the corporation would have the power to indemnify the
person under any other provision of law except as provided in this
section and whether or not the indemnified liability arises or arose from
any threatened, pending or completed action by or in the right of the
corporation. Such indemnification is declared to be consistent with the
public policy of the Commonwealth of Pennsylvania.
Section 1747. Power to purchase insurance. Unless otherwise
restricted in its bylaws, a business corporation shall have power to
purchase and maintain insurance on behalf of any person who is or was a
representative of the corporation, or is or was serving at the request of
the corporation as a representative of another domestic or foreign
corporation for profit or not-for-profit, partnership, joint venture,
trust or other enterprise against any liability asserted against him and
incurred by him in any such capacity, or arising out of his status as
such, whether or not the corporation would have the power to indemnify
him against such liability under the provisions of this subchapter. Such
insurance is declared to be consistent with the public policy of the
Commonwealth of Pennsylvania.
Section 1750. Duration and extent of coverages. The
indemnification and advancement of expenses provided by, or granted
pursuant to, this subchapter shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
representative of the corporation and shall inure to the benefit of the
heirs and personal representative of, that person.
Section 7.1 of the Company's By-Laws also contains provisions
allowing for indemnification of directors and officers to the extent
permitted under Subchapter D of Chapter 17 of the Pennsylvania Business
Corporation Law of 1988.
II-2
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
4(a) Quaker Chemical Corporation Profit Sharing and Retirement Savings
Plan.*
4(b) Agreement of Trust, dated as of November 3, 1992, between Quaker
Chemical Corporation and CoreStates Bank.*
4(c) Group Annuity Contract No. 83729, effective as of December 30,
1988, between Principal Financial Group (formerly Bankers Life)
and Quaker Chemical Corporation.*
5(a) Opinion of Fox, Rothschild, O'Brien & Frankel, Philadelphia,
Pennsylvania.*
23(a) Consent of Fox, Rothschild, O'Brien & Frankel. Reference is made
to Exhibit 5(a) hereto.
23(b) Consents of Independent Accountants--Incorporated by reference to
Exhibit 23 to Quaker Chemical Corporation's Annual Report on Form 10-K
for the year ended December 31, 1993 and Exhibit 23 to Quaker Chemical
Corporation Profit Sharing and Retirement Savings Plan's Annual
Report on Form 11-K for the year ended December 31, 1993.
24 Power of Attorney.*
- ----------------
*Previously filed as an exhibit to this Registration Statement.
Quaker Chemical Corporation undertakes that it will submit the Plan and
any amendents thereto to the Internal Revenue Service (the "IRS") in a timely
manner and will make all changes required by the IRS in order to qualify the
Plan under Section 401 of the Internal Revenue Code of 1986, as amended.
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in the registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply
if the registration statement is on Form S-3 or Form S-8, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
II-3
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
Where interests in a plan are registered herewith, the undersigned
registrant and plan hereby undertake to transmit or cause to be
transmitted promptly, without charge, to any participant in the plan who
makes a written request, a copy of the then latest annual report of the
plan filed pursuant to Section 15(d) of the Securities Exchange Act of
1934. If such report is filed as a part of the registrant's annual
report on Form 10-K, that entire report (excluding exhibits) shall be
delivered upon written request. If such report is filed as a part of the
registrant's annual report to stockholders delivered pursuant to
paragraph (1) or (2) of this undertaking, additional delivery shall not
be required.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection
with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as expressed
in the Act and will be governed by the final adjudication of such issue.
II-4
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused
this Amendment to be signed on its behalf by the undersigned, thereunto duly
authorized, in Conshohocken, Pennsylvania, on the 26th day of October, 1994.
QUAKER CHEMICAL CORPORATION
By: /s/ PETER A. BENOLIEL
---------------------------
Peter A. Benoliel,
Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this
Amendment has been signed below by the following persons in the capacities and
on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ PETER A. BENOLIEL Chairman of the Board October 26, 1994
- ------------------------------
Peter A. Benoliel
/s/ SIGISMUNDUS W. W. LUBSEN President, Chief Executive October 26, 1994
- ------------------------------ Officer and Director
Sigismundus W. W. Lubsen Principal Executive Officer)
/s/ JOSEPH F. SPANIER Vice President and Corporate October 26, 1994
- ------------------------------ Controller (Principal
Joseph F. Spanier Financial and Accounting
Officer)
/s/ JOSEPH B. ANDERSON, JR. Director October 26, 1994
- ------------------------------
Joseph B. Anderson, Jr.
* Director October 26, 1994
- ------------------------------
Patricia C. Barron
/s/ WILLIAM L. BATCHELOR Director October 26, 1994
- ------------------------------
William L. Batchelor
/s/ LENNOX K. BLACK Director October 26, 1994
- ------------------------------
Lennox K. Black
/s/ EDWIN J. DELATTRE Director October 26, 1994
- ------------------------------
Edwin J. Delattre
/s/ FRANCIS J. DUNLEAVY Director October 26, 1994
- ------------------------------
Francis J. Dunleavy
II-5
SIGNATURE TITLE DATE
--------- ----- ----
/s/ ROBERT P. HAUPTFUHRER Director October 26, 1994
- ------------------------------
Robert P. Hauptfuhrer
/s/ FREDERICK HELDRING Director October 26, 1994
- ------------------------------
Frederick Heldring
* Director October 26, 1994
- ------------------------------
Ronald J. Naples
/s/ ALEX SATINSKY Director October 26, 1994
- ------------------------------
Alex Satinsky
/s/ D. ROBERT YARNALL, JR. Director October 26, 1994
- ------------------------------
D. Robert Yarnall, Jr.
*By PETER A. BENOLIEL
ATTORNEY-IN-FACT
/s/ PETER A. BENOLIEL
- ------------------------------ October 26, 1994
Peter A. Benoliel
The Plan. Pursuant to the requirements of the Securities Act of 1933,
the committee which administers the Plan has caused this Registration
Statement to be signed on behalf of the Plan by the undersigned, thereunto
duly authorized in Conshohocken, Pennsylvania, on October 26, 1994.
-----------------------------------------------
Joseph R. Bowen, Member of the Committee
-----------------------------------------------
John J. Cavanaugh, III, Member of the Committee
/s/ RICHARD J. FAGAN
-----------------------------------------------
Richard J. Fagan, Member of the Committee
/s/ DONALD F. FAHEY
-----------------------------------------------
Donald F. Fahey, Member of the Committee
-----------------------------------------------
Joseph C. Hudson, Member of the Committee
/s/ KEVIN M. JARRETT
-----------------------------------------------
Kevin M. Jarrett, Member of the Committee
/s/ JOAN M. McCORMICK
-----------------------------------------------
Joan M. McCormick, Member of the Committee
II-6