UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
 
 
 
 
 
 
FORM 11-K
 
 
 
 
 
 
[X]
ANNUAL REPORT PURSUANT TO
 
SECTION 15(d) OF THE SECURITIES EXCHANGE
 
ACT OF 1934
For the fiscal year ended December 31, 2019
 
OR
 
[
 
]
TRANSITION REPORT PURSUANT TO
 
SECTION 15(d) OF THE SECURITIES EXCHANGE
 
ACT OF 1934
 
For the transition period from
 
to
 
 
Commission file number 001-12019
 
 
 
 
 
 
A. Full title of the plan and the address of the plan, if different from that of the issuer named below:
 
Quaker Chemical Corporation
Retirement Savings Plan
 
B. Name of issuer of the securities held pursuant to the plan and the address
 
of its principal executive office:
 
Quaker Chemical Corporation
One Quaker Park
901 E. Hector Street
Conshohocken, PA 19428-2380
 
 
 
 
QUAKER CHEMICAL CORPORATION
 
Retirement Savings Plan
Table
 
of Contents
 
 
Page
Number
1-2
3
4
5-9
Additional Information*
10
 
*
 
Other supplemental schedules required by Section 2520.103-10
 
of the Department of Labor Rules and
 
 
Regulations for Reporting and Disclosure under ERISA have been
 
omitted because they are not applicable.
11
Exhibits
 
 
1
Report of Independent Registered Public Accounting
 
Firm
 
To the Plan
 
Administrator and Plan Participants of
 
Quaker Chemical Corporation Retirement Savings Plan:
 
Opinion on the Financial Statements
 
We have audited
 
the accompanying statement of net assets available for benefits
 
of the Quaker Chemical Corporation Retirement
Savings Plan (the "Plan") as of December 31, 2019, the
 
related statement of changes in net assets available for benefits
 
for the year
then ended, and the related notes (collectively referred
 
to as the "financial statements"). In our opinion, the 2019 finan
 
cial statements
present fairly,
 
in all material respects, the net assets available for benefits of
 
the Plan as of December 31, 2019, and the changes in net
assets available for benefits for the year then ended, in
 
conformity with accounting principles generally accepted in
 
the United States
of America.
 
Basis for Opinion
 
These financial statements are the responsibility of the
 
Plan's management. Our responsibility is to express an opinion
 
on the Plan's
financial statements based on our audit. We
 
are a public accounting firm registered with the Public Company
 
Accounting Oversight
Board (United States) ("PCAOB") and are required to be
 
independent with respect to the Plan in accordance with the U.S. federal
securities laws and the applicable rules and regulations
 
of the Securities and Exchange Commission and the PCAOB.
 
We conducted
 
our audit in accordance with the standards of the PCAOB. Those
 
standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial
 
statements are free of material misstatement, whether due
 
to error or fraud.
 
 
Our audit included performing procedures to assess the risks
 
of material misstatement of the financial statements, whether
 
due to error
or fraud, and performing procedures that respond
 
to those risks. Such procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the financial statements.
 
Our audit also included evaluating the accounting principles used
and significant estimates made by management, as well as evaluating
 
the overall presentation of the financial statements. We
 
believe
that our audit provides a reasonable basis for our
 
opinion.
 
Other Matter – 2018 Financial Statements
 
The financial statements of the Plan as of December 31,
 
2018 were audited by another auditor who expressed
 
an unqualified opinion
on those statements on June 20, 2019.
 
Supplemental Information
 
The supplemental Schedule H, Line 4i – Schedule of
 
Assets (Held at End of Year)
 
as of December 31, 2019 has been subjected to
audit procedures performed in conjunction with the
 
audit of the Plan’s financial
 
statements.
 
The supplemental information is the
responsibility of the Plan’s
 
management.
 
Our audit procedures included determining whether the
 
supplemental information reconciles
to the financial statements or the underlying accounting
 
and other records, as applicable, and performing procedures to test the
completeness and accuracy of the information presented
 
in the supplemental information.
 
In forming our opinion on the supplemental
information, we evaluated whether the supplemental information,
 
including its form and content, is presented in conformity
 
with the
Department of Labor’s Rules and Regulations
 
for Reporting and Disclosure under the Employee Retirement Income
 
Security Act of
1974.
 
In our opinion, the supplemental information is fairly stated, in
 
all material respects, in relation to the financial statements as a
whole.
 
We have served
 
as the Plan’s auditor since 2020.
 
/s/ Baker Tilly Virchow
 
Krause, LLP
 
Philadelphia, Pennsylvania
June 18, 2020
 
 
2
Report of Independent Registered Public Accounting
 
Firm
 
Plan Administrator and Plan Participants
Quaker Chemical Corporation Retirement Savings Plan
Conshohocken, Pennsylvania
 
Opinion on the Financial Statements
 
We have audited
 
the accompanying statement of net assets available for benefits
 
of the Quaker Chemical Corporation Retirement
Savings Plan (the “Plan”) as of December 31, 2018, the
 
related statement of changes in net assets available for benefits
 
for the year
then ended, and the related notes (collectively,
 
the “financial statements”). In our opinion, the financial statements
 
present fairly, in all
material respects, the net assets available for benefits of
 
the Plan as of December 31, 2018, and the changes in net assets available for
benefits for the year then ended, in conformity with accounting
 
principles generally accepted in the United States of America.
 
Basis for Opinion
 
These financial statements are the responsibility of the
 
Plan’s management. Our responsibility
 
is to express an opinion on the Plan’s
financial statements based on our audit. We
 
are a public accounting firm registered with the Public Company
 
Accounting Oversight
Board (United States) (“PCAOB”) and are required to be
 
independent with respect to the Plan in accordance with the U.S. federal
securities laws and the applicable rules and regulations
 
of the Securities and Exchange Commission and the PCAOB.
 
 
We conducted
 
our audit in accordance with the standards of the PCAOB. Those
 
standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial
 
statements are free of material misstatement, whether due
 
to error or fraud.
The Plan is not required to have, nor were we engaged
 
to perform, an audit of its internal control over financial reporting.
 
As part of
our audit we are required to obtain an understanding
 
of internal control over financial reporting but not for the
 
purpose of expressing
an opinion on the effectiveness of the Plan’s
 
internal control over financial reporting. Accordingly,
 
we express no such opinion.
 
 
Our audit included performing procedures to assess the risk
 
of material misstatement of the financial statements, whether
 
due to error
or fraud, and performing procedures that respond
 
to those risks. Such procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the financial statement
 
s. Our audit also included evaluating the accounting
 
principles used
and significant estimates made by the Plan’s
 
management, as well as evaluating the overall presentation of the
 
financial statements.
We believe that
 
our audit provides a reasonable basis for our opinion.
 
We have served
 
as the Plan’s auditor from
 
2012 to 2019.
 
/s/ BDO USA, LLP
 
 
Philadelphia, Pennsylvania
June 20, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3
QUAKER CHEMICAL CORPORATION
RETIREMENT SAVINGS
 
PLAN
 
STATEMENTS
 
OF NET ASSETS AVAILABLE
 
FOR BENEFITS
 
As of December 31,
 
2019
2018
Assets
Investments, at fair value:
Registered investment companies
$
96,372,576
$
82,967,513
Collective trust fund
14,053,213
13,976,759
Quaker Chemical Corporation Stock Fund
34,363,906
43,622,392
Participant-directed brokerage account
1,765,176
1,331,432
Total investments
146,554,871
141,898,096
Receivables:
Employer's contributions
172,704
163,476
Participant notes receivable
2,076,394
1,838,851
Total receivables
2,249,098
2,002,327
Net assets available for benefits
$
148,803,969
$
143,900,423
 
The accompanying notes are an integral
 
part of the financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4
QUAKER CHEMICAL CORPORATION
RETIREMENT SAVINGS
 
PLAN
 
STATEMENTS
 
OF CHANGES IN NET ASSETS AVAILABLE
 
FOR BENEFITS
 
For the Year
 
Ended
December 31,
 
2019
2018
Additions
Investment income:
Interest and dividend income
$
3,576,259
$
4,286,197
Net appreciation (depreciation) in fair value of investments
14,683,064
(1,655,390)
Total investment
 
income
18,259,323
2,630,807
Interest income, participant notes receivable
103,644
83,678
Contributions:
Employer
3,230,980
3,162,787
Participant
5,090,433
5,344,961
Total contributions
8,321,413
8,507,748
Total additions
26,684,380
11,222,233
Deductions
Payment of benefits
21,780,834
9,207,245
Total deductions
21,780,834
9,207,245
Net increase
 
4,903,546
2,014,988
Net assets available for benefits:
Beginning of year
143,900,423
141,885,435
End of year
$
148,803,969
$
143,900,423
 
The accompanying notes are an integral
 
part of the financial statements.
Quaker Chemical Corporation
Retirement Savings Plan
Notes to Financial Statements
 
 
5
NOTE 1 – DESCRIPTION OF PLAN
The following description of the Quaker Chemical
 
Corporation Retirement Savings Plan (the “Plan”) provides only
 
general
information.
 
The Plan document provides
 
a complete description of the Plan’s
 
provisions.
General
The Plan is a defined contribution plan for certain U.S. employees
 
of Quaker Chemical Corporation (the “Company”) and
participating employers
 
(AC Products, Inc. (“AC”), Epmar Corporation (“Epmar”),
 
Summit Lubricants, Inc. (“Summit”) and ECLI
Products, LLC (“ECLI”)).
 
The Plan is administered by the Retirement Savings Plan Committee
 
,
 
which is appointed by the
Company’s Board
 
of Directors, and is subject to the Employee Retirement Income
 
Security Act of 1974 (“ERISA”).
 
Employees of the Company and adopting affiliates
 
are eligible to participate in the Plan on their first day
 
of employment or as soon as
administratively practicable thereafter,
 
unless specified differently in any bargaining
 
unit agreement.
 
Plan Amendments
Effective January 1, 2019 pursuant to Ame
 
ndment No. 4 to the amendment and restatement of the Plan
 
dated January 1, 2016 (the
“2016 Restatement”), the Plan was amended to:
 
(i) comply with the final Department of Labor regulations
 
regarding disability claims
and appeals procedures; (ii) clarify certain provisions relating
 
to the merger between the Company and G.W.
 
Smith & Sons and to
clarify that employees of ECLI are not eligible for certain
 
contributions under the Plan; and (iii) modify the definition of compensation
to exclude moving expenses.
Effective January 1, 2020, the Plan was amended
 
and restated as the “Quaker Houghton Retirement Savings Plan”
 
(the “2020
Restatement”), merging the Houghton International
 
Inc. Tax Advantaged
 
Capital Accumulation Plan (the “Houghton Plan”) and the
Wallover Enterprises
 
Inc. Profit Sharing Plan and Trust (the
 
“Wallover Plan”)
 
into the Plan.
 
The 2020 Restatement changed the Plan
to: (i) incorporate amendments adopted after the 2016
 
Restatement; (ii) add Houghton International Inc. and Wallover
 
Oil Company,
Inc. as participating employers in the Plan; (iii) clarify
 
the definition of compensation; (iv) increase the deferral limitation
 
from 50%
to 75% of compensation; (v) increase the automatic
 
enrollment percentage to 6% of compensation with automatic increases up
 
to 10%
of compensation; (vi) permit hardship withdrawals for all vested
 
amounts; (vii) permit qualified reservist distributions
 
and deemed
severance distributions; and (viii) increase involuntary
 
cash-outs to $5,000 or less (with automatic rollovers above
 
$1,000).
 
Effective March 1, 2020 pursuant to Amendment
 
No. 1 to the 2020 Restatement, the Plan was amended to
 
automatically enroll
eligible employees hired on or after March 1, 2020
 
as of the first pay date on or after the 30th day after their
 
hire date.
 
Effective February 10, 2020 pursuant to Amendment
 
No. 2 to the 2020 Restatement, the Plan was amended to clarify
 
eligibility for
nonelective contributions for certain collectively bargained
 
employees.
 
Effective April 17, 2020 pursuant to Amendment
 
No. 3 to the 2020 Restatement, the Plan was amended to
 
permit matching
contributions and nonelective contributions to be
 
made in cash or in Company common stock, in the sole discretion
 
of the Retirement
Savings Plan Committee.
Contributions
Participants may elect to contribute on a before-tax
 
and/or after-tax basis any whole percentage of their compensation
 
as defined,
 
up to
50% (increased to 75% effective as of January
 
1, 2020),
 
during the year, not to exceed the
 
annual Internal Revenue Code (“IRC”)
limits.
 
At the discretion of the Retirement Savings Plan Committee
 
,
 
the Plan matches 50% of the first 6% of compensation
 
as defined
that is contributed to the Plan, with a maximum
 
matching contribution of 3% of compensation.
 
No changes were made to the
discretionary matching provision during 2019 or 2018.
 
In addition, the Plan provides for non-elective nondiscretionary
 
contributions
on behalf of participants who have completed one year
 
of service equal to 3% of the eligible participant's compensation
 
,
 
as defined.
The Company’s Board
 
of Directors (and AC’s Board of
 
Directors with respect to AC participants) reserves the right to
 
make future
discretionary non-elective contributions, which are allocated
 
on the basis of eligible participants’ compensation, as defined.
 
Upon
completing one year of service, an eligible participant is eligible
 
to receive discretionary non-elective contributions on the first
 
day of
the month coinciding with or following the date on
 
which the participant meets the one year of service requirement
 
.
 
Epmar, Summit
and ECLI participants are not eligible for discretionary
 
non-elective contributions.
Participants who are eligible to make contributions and
 
who have or will attain age 50 before the end of the Plan year are eligible
 
to
make catch-up contributions in accordance with, and
 
subject to, the limitations of IRC Section 414(v).
 
No Company matching
contributions are made with respect to catch-up contributions.
There were no non-cash contributions made by the Company during
 
the years ended December 31, 2019 and 2018.
 
Quaker Chemical Corporation
Retirement Savings Plan
Notes to Financial Statements - Continued
 
6
Participant Accounts
Each participant’s account
 
is credited or deducted with the participant’s
 
contribution and any applicable direct expenses and allocation
of the Company’s contributions
 
and any Plan earnings and losses.
 
Allocations are based on participant earnings, accoun
 
t
 
balances, or
specific participation transactions, as defined.
 
The benefit to which a participant is entitled is the benefit
 
that can be provided from the
participant’s vested account
 
balance.
Participant Notes Receivable
Participants may borrow from their fund accounts (other
 
than amounts invested in the Company Stock Fund) an amount
 
limited to the
lesser of $50,000 or 50% of the participant’s
 
vested account balance.
 
The loans bear interest at a rate equal to the prevailing rate of
interest charged for similar loans by lending
 
institutions in the community (generally the prime rate), plus
 
1%.
 
The term of each
participant loan generally may not exceed five years except
 
for the purchase of principal residence loans.
 
Interest rates on outstanding
participant notes receivable at December 31, 2019 ranged
 
from 4.25% to 6.50%.
 
Principal and interest is paid ratably through periodic
payroll deductions.
 
Loan application fees and annual maintenance fees on all
 
outstanding loans are paid by the participant.
Additionally, pursuant
 
to the Coronavirus Aid, Relief and Economic Security Act (“CARES
 
Act”), participants that have an existing
loan from the Plan or take a new loan that has a first repayment
 
date on or before December 31, 2020 may extend the period
 
for loan
repayments up to one year.
Payment of Benefits
Generally, upon
 
separation of service, for any reason, a participant may receive
 
a lump sum amount equal to the value of the
participant’s account.
 
In addition, a participant may elect to take an in-service distribution
 
from their rollover account prior to
reaching age 59 ½, and from all accounts upon reaching
 
age 59 ½.
 
If a participant’s vested account
 
balance exceeds $1,000, the
participant may defer payment until April 1 following
 
the year the participant reaches age 70 ½ or following the year
 
in which the
participant terminates employment, if later.
 
Effective January 1, 2020, pursuant to the Setting Every
 
Community Up for Retirement
Enhancement Act of 2019 (“SECURE Act”), the required
 
minimum distribution age was raised to 72 from 70 ½.
 
Additionally, pursuant
 
to the CARES Act, the Plan allows coronavirus-related penalty
 
-free distributions made to qualified individuals,
as defined in the CARES Act.
 
The maximum distribution is the lesser of the vested
 
portion of the participant's account balance in the
Plan or $100,000.
Hardship Withdrawals
 
Participants who are actively employed and who meet
 
certain requirements may take a hardship withdrawal from
 
their elective
contributions.
 
Participants who receive a hardship withdrawal will not be eligible
 
to make contributions for six months following the
receipt of the hardship withdrawal.
 
Effective January 1, 2020, pursuant to
 
the SECURE Act, participants who receive a hardship
withdrawal are eligible to immediately make contributions
 
following the receipt of the hardship withdrawal.
 
Vesting
Upon entering the Plan, participants are fully vested in
 
Company matching contributions, Company discretionary non
 
-elective
contributions, Company nondiscretionary non-elective
 
contributions and employee deferrals plus actual earnings.
Plan Termination
Although it has not expressed any intent to do
 
so, the Company has the right to terminate the Plan subject to the
 
provisions of ERISA.
 
NOTE 2 – SUMMARY OF ACCOUNTING
 
POLICIES
Basis of Accounting
The Plan’s financial
 
statements are prepared on the accrual basis of accounting.
Use of Estimates
The preparation of financial statements in conformity
 
with accounting principles generally accepted in the United States of
 
America
requires management to make estimates and assumptions that
 
affect the reported amounts of assets, liabilities, and
 
changes therein,
and disclosure of contingent assets and liabilities.
 
The most significant estimate is the determination
 
of the fair values of the Plan’s
investments.
 
Actual results could differ from those estimates.
 
 
 
 
 
 
 
 
 
 
 
 
Quaker Chemical Corporation
Retirement Savings Plan
Notes to Financial Statements - Continued
 
7
Administration of Plan Assets
The Plan’s assets are held
 
by a collective trust managed by an affiliate of
 
Vanguard
 
Fiduciary Trust Company (“VFTC”), which
 
acts
as the Trustee for Plan investments.
 
Certain administrative functions are performed by officers
 
or employees of the Company.
 
No
such officer or employee receives compensation
 
from the Plan.
 
Substantially all administrative expenses, including the Trustee’s
 
and
audit fees, are paid directly by the Company and
 
are therefore excluded from these financial statements.
 
Investment Valuation
 
and Income Recognition
The Plan’s investments are
 
recorded at fair value.
 
Fair value is the price that would be received to sell an
 
asset or paid to transfer a
liability in an orderly transaction between market participants at
 
the measurement date.
 
Plan management determines the Plan’s
valuation policies utilizing information provided by the
 
Trustee.
 
Refer to Note 4 – Fair Value
 
Measures for further information.
Purchases and sales of investments are recorded on a trade-date
 
basis.
 
Net appreciation (depreciation) in fair value of investments
includes gains and losses on investments bought and sold
 
during the year as well as unrealized gains and losses on
 
those held at year
end.
 
Interest income is accrued when earned.
 
Dividend income is recorded on the ex-dividend date.
 
Capital gain distributions are
included in dividend income.
Net investment returns reflect certain fees paid by
 
the investment funds, which include costs for portfolio management,
 
administrative
and other services as described in each fund’s
 
prospectus.
 
These fees are deducted by the investment funds prior to
 
allocation of the
Plan’s investment earnings
 
activity and are therefore not separately identified as Plan expenses.
Participant Notes Receivable
Notes receivable from participants are measured at
 
their unpaid principal balance plus any accrued but unpaid interest.
 
Interest
income is recorded on the accrual basis.
 
No allowance for credit losses was recorded as of December
 
31, 2019 or 2018.
 
Delinquent
notes receivable from participants are recorded as a benefit
 
payment when the Plan Administrator deems the participant
 
note
receivable to be in default based on the terms of the Plan
 
document.
 
Payment of Benefits
Benefits are recorded when paid.
Recently Issued Accounting Standards
In February 2017, the Financial Accounting Standards
 
Board (“FASB”) issued ASU No.
 
2017-
 
06,
Plan Accounting: Defined Benefit
Pension Plans (Topic
 
960), Defined Contribution Pension Plans (Topic
 
962), Health and Welfare
 
Benefit Plans (Topic
 
965):
Employee Benefit Plan Master Trust
 
Reporting.
 
The amendments in this update require employee benefit
 
plans to report its interest in
a master trust and the change in the value of the interest
 
as separate line items on the statement of net assets available for
 
benefits and
the statement of changes in net assets available for benefits,
 
respectively.
 
The update requires a plan to disclose the master trust’s
other assets and liabilities, as well as the dollar amount
 
of its interest in these balances.
 
In addition, the amendments in this update
remove the requirement to disclose the percentage interest
 
in the master trust for plans with divided interest and requires that
 
a plan
disclose the dollar amount of its interest in the general types of
 
investments held by the master trust.
 
The amendments in this update
are effective for fiscal years beginning after
 
December 15, 2018, and should be applied on a retrospective
 
basis for the periods
presented.
 
The Plan adopted the guidance in 2019 with no impact to its financial
 
statements.
 
NOTE 3 – RISKS AND UNCERTAINTIES
Investment securities are exposed to various risks such as interest
 
rate, credit and overall market volatility.
 
Due to the risks associated
with investment securities, it is possible that changes in
 
the values of investment securities will occur in the near term
 
and that such
changes could materially affect participants’ account
 
balances and the amounts reported in the statements of net assets available
 
for
benefits.
 
The Plan therefore provides for investment options in various investment
 
securities, which allows participants to diversify
their securities portfolios and mitigate these risks.
The following table shows details on investments that represent
 
a concentration of greater than 10% of the Plan’s
 
net assets:
December 31, 2019
December 31, 2018
Investments
Balance
% of Net assets
Balance
% of Net assets
Vanguard
 
500 Index Fund
$
19,709,441
13%
$
17,432,090
12%
Quaker Chemical Corporation Common Stock Fund
34,363,906
23%
43,622,392
30%
Due the concentration of investments denoted above, in
 
addition to the level of risk associated with certain investments,
 
it is at least
reasonably possible that changes in the value of investments
 
will occur in the near term and that such changes could
 
materially affect
participants’ account balances and the amounts reported in
 
the Statements of Net Assets Available
 
for Benefits.
Quaker Chemical Corporation
Retirement Savings Plan
Notes to Financial Statements - Continued
 
8
NOTE 4 – FAIR VALUE
 
MEASURES
The Plan applies the guidance of the FASB
 
regarding fair value measurements, which establishes a common
 
definition for fair value.
 
Specifically, the guidance utilizes
 
a fair value
 
hierarchy
 
that prioritizes
 
the inputs
 
to valuation
 
techniques
 
used to measure
 
fair value
 
into
three broad
 
levels.
 
The following
 
is a brief
 
description
 
of those
 
three levels:
●
 
Level 1: Observable
 
inputs such
 
as quoted
 
prices (unadjusted)
 
in active
 
markets for
 
identical
 
assets or
 
liabilities.
●
 
Level 2: Inputs
 
other than
 
quoted prices
 
that are
 
observable
 
for the asset
 
or liability,
 
either directly
 
or indirectly.
 
These include
quoted prices
 
for similar
 
assets or
 
liabilities
 
in active
 
markets and
 
quoted prices
 
for identical
 
or similar
 
assets or
 
liabilities
 
in
markets that
 
are not active.
●
 
Level 3: Unobservable
 
inputs that
 
reflect the
 
reporting
 
entity’s own assumptions.
The following
 
is a description
 
of the valuation
 
methodologies
 
used for
 
the investments
 
measured at
 
fair value,
 
including
 
the general
classification
 
of such instruments
 
pursuant
 
to the valuation
 
hierarchy:
Registered Investment
 
Companies
The shares
 
of registered
 
investment
 
companies,
 
which represent
 
the Net Asset Value (“NAV”)
 
of shares
 
held by the
 
Plan, are
 
valued
based on quoted
 
market prices
 
on an exchange
 
in an active
 
market and
 
are classified
 
as Level
 
1 investments.
 
Common Stock
 
Fund
The common
 
stock fund
 
is comprised
 
of investments
 
in the Quaker
 
Chemical
 
Corporation
 
Stock Fund,
 
which is
 
composed
 
of shares
 
of
the Company
 
and uninvested
 
cash.
 
The shares
 
of the Company
 
are traded
 
on an exchange
 
in an active
 
market and
 
are classified
 
as a
Level 1 investment.
Participant-Directed
 
Brokerage Account
 
The participant-directed
 
brokerage
 
account is
 
mainly composed
 
of investments
 
in common
 
stock and
 
registered
 
investment
 
companies,
which are
 
valued based
 
on quoted
 
market prices
 
on an exchange
 
in an active
 
market and
 
are classified
 
as Level
 
1 investments.
 
Common/Collective
 
Trust
The Plan also invests in a common/collective trust,
 
the Vanguard
 
Retirement Savings Trust (the “Trust”),
 
a stable value fund that
invests in the Va
 
nguard Retirement Savings Master Trust
 
(“VRSMT”).
 
The VRSMT is composed of an investment in fully
benefit-responsive contracts that are issued by insurance
 
companies and commercial banks and in contracts that are
 
backed by
bond funds and trusts that are selected by Vanguard
 
Fiduciary Trust Employer,
 
the Trustee.
 
Contract value, as reported by
VRSMT, is the amount
 
participants would receive if they were to initiate a permitted transaction under the terms of the Plan, and
also, represents contributions made under the contract,
 
plus earnings, less participant withdrawals.
 
Participants may ordinarily
direct the withdrawal or transfer of all or a portion
 
of their investment at contract value.
 
Certain events limit the Plan’s ability to
transact at contract value, including: 1) premature termination
 
of the contracts by the Plan; 2) Plan termination; and 3)
 
bankruptcy
of the Plan sponsor.
 
The Plan administrator does not believe that any events that would
 
limit the Plan’s ability to transact at
contract value with Plan participants are probable of occurring.
 
Contract issuers may terminate and settle the contracts at other
than contract value if there is a change in qualification status of
 
a participant, sponsor or plan, a breach of material obligations
under the contract and misrepresentation by the contract
 
holder or failure of the underlying portfolio to conform to
 
pre-established
investment guidelines.
 
The Trust is valued at the NAV
 
of units held at year end.
 
The NAV,
 
as provided by the Trustee, is used as
a practical expedient to estimate fair value.
 
The NAV
 
($1 at each December 31, 2019 and 2018) is based on the fair
 
value of the
underlying investments less any liabilities.
 
The practical expedient would not be used when it is determined
 
to be probable that
the Trust will sell the investment for
 
an amount different than the reported NAV.
 
The Trust has a fair value of $14,053,213 and
$13,976,759 as of December 31, 2019 and 2018, respectively,
 
with no unfunded commitments, daily pricing frequency,
 
and daily
redemption notice periods.
The valuation methodologies described above may produce
 
fair value calculations that may not be indicative of net
 
realizable value or
reflective of future fair values.
 
Furthermore, while the Plan believes its valuation methodologies
 
are appropriate and consistent with
other market participants, the use of different
 
methodologies or assumptions to determine the fair value of
 
certain financial
instruments could result in a different fair
 
value measurement at the reporting date.
 
There have been no significant changes in
methodologies used or transfers between levels during
 
the years ended December 31, 2019 and 2018.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quaker Chemical Corporation
Retirement Savings Plan
Notes to Financial Statements - Continued
 
9
As of December 31, 2019 and 2018, the Plan’s
 
investments measured at fair value on a recurring basis were as follows:
Fair Value
 
Measurements at December 31, 2019
Total
Using Fair Value
 
Hierarchy
Investments
Fair Value
Level 1
Level 2
Level 3
Registered investment companies
$
96,372,576
$
96,372,576
$
—
$
—
Common stock fund
34,363,906
34,363,906
—
—
Participant-directed brokerage accounts
1,765,176
1,765,176
—
—
Total investments
 
in fair value hierarchy
$
132,501,658
$
132,501,658
$
—
$
—
Common/collective trust measured at NAV
 
*
14,053,213
Total investments
$
146,554,871
$
132,501,658
$
—
$
—
Fair Value
 
Measurements at December 31, 2018
Total
Using Fair Value
 
Hierarchy
Investments
Fair Value
Level 1
Level 2
Level 3
Registered investment companies
$
82,967,513
$
82,967,513
$
—
$
—
Common stock fund
43,622,392
43,622,392
—
—
Participant-directed brokerage accounts
1,331,432
1,331,432
—
—
Total investments
 
in fair value hierarchy
$
127,921,337
$
127,921,337
$
—
$
—
Common/collective trust measured at NAV
 
*
13,976,759
Total investments
$
141,898,096
$
127,921,337
$
—
$
—
* Certain investments that are measured at fair value using the NAV per share (or its equivalent) have not been classified in the fair value hierarchy.
 
The fair value
amounts presented in these tables are intended to permit reconciliation of
 
the fair value hierarchies to the line items presented in the statements of net assets
 
available
for benefits.
NOTE 5 – RELATED
 
PARTY
 
AND PARTY
 
-IN-INTEREST TRANSACTIONS
The Plan invests in shares of mutual funds and a collective
 
trust managed by an affiliate of VFTC, which acts
 
as the Trustee for Plan
investments.
 
In addition, shares of Company common stock included
 
in the Quaker Chemical Corporation Stock Fund are offered
 
as an investment
to Plan participants. As of December 31, 2019 and
 
2018, the Plan held 208,874 and 245,470 shares of common
 
stock of Quaker
Chemical Corporation, respectively,
 
with a fair value of $34,363,906 and $43,622
 
,392. Total sales at market value
 
related to the
Quaker Chemical Corporation Stock Fund for the year
 
ended December 31, 2019 was $14,730,685.
 
Total contributions into
 
the
Quaker Chemical Corporation Stock Fund for the year
 
ended December 31, 2019 was $611,288.
 
Transactions in such investments
qualify as party-in-interest transactions and are exempt
 
from the prohibited transaction rules.
 
Participant notes receivable qualify as party-in-interest transactions
 
and are exempt from the prohibited transaction
 
rules.
NOTE 6 – TAX STATUS
The IRS informed the Company by letter dated November
 
15, 2017 that the Plan is qualified under IRC Section 401(a).
 
The Plan has
since been amended,
 
however, the Plan administrator continues
 
to believe the Plan is currently designed and being operated
 
in
compliance with the applicable requirements of the
 
IRC.
 
The Plan administrator has not identified any uncertain
 
tax positions which
would require adjustment to or disclosure in the Plan’s
 
financial statements.
 
The IRS has the ability to examine the Plan’s
 
tax return
filings for all open tax years, which generally relate to
 
the three prior years; however, there are
 
currently no audits for any tax periods
in progress.
 
The Plan administrator believes it is no longer subject to income
 
tax examinations for years prior to 2016.
NOTE 7 – SUBSEQUENT EVENTS
The Company and the Plan have evaluated subsequent
 
events through the date that these financial statements were available to
 
be
issued, and there were no subsequent events which would
 
require an adjustment or additional disclosures to the financial
 
statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Schedule I
Quaker Chemical Corporation
Retirement Savings Plan
 
Schedule of Assets (Held at End of Year)
As of December 31, 2019
 
Quaker Chemical Corporation Retirement Savings Plan, EIN 23
 
-0993790, PN 112
 
Attachment to Form 5500, Schedule H, Part IV,
 
Line 4 (i):
10
(a)
(b) Identity of issue, borrower,
 
lessor, or
 
similar party
(c) Description of investment
including maturity date, rate of
interest, collateral, par,
 
or
maturity value
(e) Current
Value
 
Columbia Small Cap Growth Fund, Inc
Registered Investment Company
$
5,673,213
*
Vanguard
 
500 Index Fund Investor Shares
Registered Investment Company
19,709,441
*
Vanguard
 
Balanced Index Fund Investor Shares
Registered Investment Company
3,750,774
*
Vanguard
 
Extended Market Index Fund Investor Shares
Registered Investment Company
4,887,719
*
Vanguard
 
Federal Money Market Fund
Registered Investment Company
155,483
*
Vanguard
 
International Growth Fund Investor Shares
Registered Investment Company
4,979,087
*
Vanguard
 
Target
 
Retirement 2015 Fund
Registered Investment Company
1,183,974
*
Vanguard
 
Target
 
Retirement 2020 Fund
Registered Investment Company
5,483,289
*
Vanguard
 
Target
 
Retirement 2025 Fund
Registered Investment Company
8,658,762
*
Vanguard
 
Target
 
Retirement 2030 Fund
Registered Investment Company
6,603,206
*
Vanguard
 
Target
 
Retirement 2035 Fund
Registered Investment Company
4,192,292
*
Vanguard
 
Target
 
Retirement 2040 Fund
Registered Investment Company
3,846,919
*
Vanguard
 
Target
 
Retirement 2045 Fund
Registered Investment Company
2,184,620
*
Vanguard
 
Target
 
Retirement 2050 Fund
Registered Investment Company
1,919,949
*
Vanguard
 
Target
 
Retirement 2055 Fund
Registered Investment Company
1,949,365
*
Vanguard
 
Target
 
Retirement 2060 Fund
Registered Investment Company
399,475
*
Vanguard
 
Target
 
Retirement 2065 Fund
Registered Investment Company
931
*
Vanguard
 
Target
 
Retirement Income
Registered Investment Company
2,304,924
*
Vanguard
 
Total Bond Market
 
Index Fund Investor Shares
Registered Investment Company
7,620,975
*
Vanguard
 
Total International
 
Bond Index Fund Investor Shares
Registered Investment Company
338,844
*
Vanguard
 
U.S. Growth Fund Investor Shares
Registered Investment Company
6,473,126
*
Vanguard
 
Windsor II Fund Investor Shares
Registered Investment Company
4,056,208
*
Vanguard
 
Brokerage Option
Self-Directed Brokerage Accounts
1,765,176
*
Vanguard
 
Retirement Savings Trust
Common/Collective Trust
14,053,213
*#
Quaker Chemical Corporation
Common Stock Fund
34,363,906
*
Participant notes receivable
(4.25% to 6.50%)
2,076,394
$
148,631,265
 
*
 
Party-in-Interest
#
 
Related party
 
(d)
 
Column (d) is omitted as cost is not required for participant directed
 
investments
 
 
 
11
Pursuant to the requirements of the Securities Exchange
 
Act of 1934, the trustees (or other persons who administer the
 
employee
benefit plan) have duly caused this annual report to
 
be signed by the undersigned hereunto duly authorized.
 
 
 
 
 
 
 
 
Quaker Chemical Corporation Retirement Savings Plan
June 18, 2020
 
By:
 
/s/ Mary Dean Hall
 
 
 
 
Mary Dean Hall, Senior Vi
 
ce President, Chief Financial Officer
and Treasurer
 
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