A tool holder is provided that is configured to deliver coolant to a work piece and/or a cutting tool. The tool holder includes a tool mounting aperture for receiving a shank of a cutting tool, and an axially extending central passage for receiving coolant deliver though a spindle of a machine tool. The tool holder additionally includes several coolant passages located around the tool mounting aperture for conveying the coolant from the central passage and distributing the coolant to the work piece and cutting tool. The coolant passages extend substantially parallel to the tool mounting aperture and are slightly radially spaced from the tool mounting aperture.
