Item 1.01 Entry into a Material Definitive Agreement.
On November 23, 2021, LKQ Corporation ("LKQ" or the "Company") and certain other
subsidiaries of LKQ (collectively, the "Borrowers") entered into Amendment No. 6
to the Fourth Amended and Restated Credit Agreement dated January 29, 2016 (the
"Credit Agreement") with the several lenders from time to time party thereto;
Wells Fargo Bank, National Association, as administrative agent; Bank of
America, N.A. and MUFG Bank, Ltd. ("MUFG") as syndication agents; Citizens Bank,
N.A.; SunTrust Bank (now known as Truist Bank); BBVA Compass; PNC Bank, National
Association; HSBC Bank USA, National Association; TD Bank, N.A.; and Capital
One, National Association, as documentation agents; and Wells Fargo Securities,
LLC; Merrill Lynch, Pierce, Fenner & Smith Incorporated; and MUFG, as joint
bookrunners and joint lead arrangers.
Amendment No. 6 to the Credit Agreement modifies certain interest rates to
provide that (1) Loans denominated in euros shall bear interest at a rate per
annum equal to the Euro Interbank Offered Rate as administered by the European
Money Markets Institute (or a comparable or successor administrator approved by
the Administrative Agent) plus the Applicable Rate, (2) Swingline Loans
denominated in Pounds Sterling shall bear interest at a rate per annum equal to
the Sterling Overnight Index Average as administered by the Bank of England (or
any successor administrator of the Sterling Overnight Index Average) ("SONIA")
plus the Applicable Rate, (3) Revolving Loans denominated in Pounds Sterling
shall bear interest at a rate per annum equal to SONIA plus an adjustment equal
to 0.0326% per annum plus the Applicable Rate, and (4) loans denominated in
Swiss Francs shall bear interest at a rate per annum equal to the Swiss Average
Rate Overnight as administered by SIX Swiss Exchange AG (or any successor
administrator of the Swiss Average Rate Overnight) plus the Applicable Rate. All
other interest rates remain the same. Amendment No.6 also makes other immaterial
or clarifying modifications and amendments to the terms of the Credit Agreement.
These amendments were necessary given that the syndicated loan market is
transitioning from using the LIBO Rate as an interest rate for all loans to
specific risk free rates for loans in each currency beginning with Pound
Sterling and Swiss Francs. LKQ expects to amend its Credit Agreement in the
future to incorporate other risk free rates for those loans that still bear
interest at the LIBO Rate plus the Applicable Margin as the syndicated loan
market continues to transition away from the LIBO Rate.
This summary does not purport to be complete and is subject to and qualified in
its entirety by reference to Amendment No. 6 to the Fourth Amended and Restated
Credit Agreement, which is filed as an exhibit to this Current Report on Form
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 of this report is incorporated herein by
Item 9.01 Financial Statements and Exhibits.
Exhibit Number Description of Exhibit
4.1 Amendment No. 6 dated as of November 23, 2021 to the Fourth Amended and
Restated Credit Agreement, which is Exhibit A to
the Amendment and Restatement
Agreement dated as of January 29, 2016 by and
among LKQ Corporation and
certain additional subsidiaries of LKQ
Corporation, as borrowers, certain
financial institutions, as lenders, and Wells Fargo Bank, National
Association, as administrative agent.
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