What changed in this filing

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Item 9A. Controls and Procedures

2022-02-25 compared with 2021-02-26 · 46 added, 68 removed, 270 unchanged (30% of the section changed)

2 unchanged sentences

As of December 31, 2021, the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of LKQ Corporation's management, including our Chief Executive Officer and our Chief Financial Officer, of our "disclosure controls and procedures" (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934).

Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that LKQ Corporation and subsidiaries' (the "Company") disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports we file with the Securities and Exchange Commission ("SEC") is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that information required to be disclosed is accumulated and communicated to the Company’s management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that LKQ Corporation and subsidiaries' (the "Company") disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports we file with the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that information required to be disclosed is accumulated and communicated to the Company’s management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Report of Management on Internal Control over Financial Reporting dated February 25, 2022

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Changes in Internal Control over Financial Reporting

There was no change in the Company’s internal control over financial reporting that occurred during the Company’s most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

We are implementing a new ERP system across our European business units using a phased approach.

As a result of this implementation, certain internal controls over financial reporting have been automated, modified, or implemented to address the new control environment associated with this ERP.

While we believe this new system will strengthen our internal controls, there are inherent risks in implementing any new system, and we will continue to evaluate these control changes as part of our assessment of internal control over financial reporting.

OTHER INFORMATION

8 unchanged sentences

Arnd Franz 56 Chief Executive Officer, LKQ Europe

Casini 58 Senior Vice President, General Counsel and Corporate Secretary

Hanley 55 Senior Vice President - Development

1 unchanged sentence

Brooks 52 Senior Vice President and Chief Information Officer

McKay 43 Senior Vice President - Human Resources

McKay 44 Senior Vice President - General Counsel & Corporate Secretary

Dombrowski 45 Senior Vice President - Human Resources

Clark 47 Vice President - Finance and Controller

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Zarcone is a member of the Board of Directors of Generac Power Systems, Inc., a designer and manufacturer of power generation equipment and engine-powered products.

Varun Laroyia became our Executive Vice President and Chief Financial Officer in October 2017.

Prior to joining our Company, he was the Chief Financial Officer of CBRE’s Global Workplace Solutions ("GWS") business since 2015, following CBRE’s acquisition of the GWS business from Johnson Controls Inc.

Varun Laroyia joined us as Executive Vice President and Chief Financial Officer in October 2017.

Prior to joining us, he was the Chief Financial Officer of CBRE’s Global Workplace Solutions (GWS) business since 2015, following CBRE’s acquisition of the GWS business from Johnson Controls Inc.

(“JCI”), where he was the Chief Financial Officer and Vice President of Information Technology since 2013.

From 2006 to 2013, Mr.

Laroyia held various positions at JCI including Group Vice President of Global Audit and Vice President of Finance and Administration for its Building Efficiency business across Europe and Africa.

From 2000 to 2006, Mr.

Laroyia held various positions at Gateway, Inc., including Vice President and Controller based in the U.S.

and Finance Director for the United Kingdom and Ireland.

Prior to Gateway, he was with General Electric in the U.S.

and then GE Capital in London where he served as a Manager of European Corporate Development.

Laroyia started his career at KPMG in London.

Laroyia held various positions at JCI including Global Group Controller of its Building Efficiency segment, Group Vice President of Global Audit and Vice President of Finance and Administration for its Building Efficiency business across Europe and Africa.

Previously, he held various leadership positions at Gateway, Inc., including Vice President and Controller for the Professional and Consumer segments.

Prior to Gateway, he was with General Electric in the US, and then GE Capital in London.

Laroyia started his career at KPMG in London and is a UK-qualified Chartered Accountant.

Laroyia is a member of the Board of Directors of Univar Solutions, Inc., a global distributor of chemical products and related services.

Arnd Franz became our Chief Executive Officer, LKQ Europe in October 2019.

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Franz also served as a member of the Board of Management of the MAHLE group from 2013 to March 2019.

Casini has been our Vice President, General Counsel and Corporate Secretary from our inception in February 1998.

In March 2008, he was elected Senior Vice President.

Casini was a member of our Board of Directors from May 2010 until May 2012.

From July 1992 to December 2011, Mr.

Casini was the Executive Vice President and General Counsel of Flynn Enterprises, Inc., a venture capital, hedging and consulting firm.

Casini served as Senior Vice President, General Counsel

and Corporate Secretary of Discovery Zone, Inc., an operator and franchiser of family entertainment centers, from July 1992 until May 1995.

Prior to July 1992, Mr.

Casini practiced corporate and securities law with the law firm of Bell, Boyd & Lloyd LLP (now known as K&L Gates LLP) in Chicago, Illinois for more than five years.

Hanley joined us in December 2002 as our Vice President of Development, Associate General Counsel and Assistant Secretary.

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Brooks also spent over ten years in consulting focusing on process improvement and systems implementations with firms including Accenture and Oracle.

McKay became our Senior Vice President of Human Resources in June 2016.

Prior thereto, he served as our Associate General Counsel from December 2007 to May 2016, focusing on employment-related matters.

McKay became our Senior Vice President, General Counsel and Corporate Secretary in March 2021.

Prior thereto, he served as our Senior Vice President of Human Resources from June 2016 to March 2021 and Associate General Counsel from December 2007 to May 2016.

Prior to joining us, Mr.

McKay served as a law clerk for Judge William Bauer at the United States Court of Appeals for the Seventh Circuit.

Dombrowski became our Senior Vice President of Human Resources in March 2021.

Dombrowski joined us from Republic Services where she held various leadership positions within the HR function from May 2011 to February 2021, most recently serving as Vice President of Talent.

Prior to Republic Services, Ms.

Dombrowski worked as an HR leader for six years with Aramark in its Sports and Entertainment line of business from February 2005 to May 2011.

Clark has been our Vice President – Finance and Controller since February 2011.

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Code of Ethics

A copy of our Code of Ethics, which is applicable to our principal executive officer, principal financial officer, and principal accounting officer, is available free of charge through our website at www.lkqcorp.com .

A copy of our Code of Ethics, which is applicable to our principal executive officer, principal financial officer, and principal accounting officer, is available through our website at www.lkqcorp.com .

Any amendments to the elements of our Code of Ethics enumerated in paragraph (b) of Item 406 of Regulation S-K, or waivers granted to the above listed officers relating to such elements, will be posted on our website.

Section 16 Compliance

Information appearing under the caption "Delinquent Section 16(a) Reports" in the Proxy Statement is incorporated herein by reference.

Audit Committee

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Equity Compensation Plan Information

Plan Category Number of

securities to be issued

upon exercise of

outstanding options,

warrants, and rights

(a) Weighted-average

exercise price of

outstanding options,

warrants, and rights

(b) Number of securities remaining

available for future

issuance under equity

compensation plans (excluding

securities reflected in column (a))

Plan Category Number of securities to be issued upon exercise of outstanding options, warrants, and rights (a) Weighted-average exercise price of outstanding options, warrants, and rights (b) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)

Equity compensation plans approved by stockholders

Stock options — $ —

Restricted stock units 1,357,079 $ —

1 unchanged sentence

Total equity compensation plans approved by stockholders 1,815,098 8,823,744

1,771,273 9,577,770

Equity compensation plans not approved by stockholders — $ — —

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(in thousands)

Description Balance at

Period Additions

Expenses Deductions Acquisitions and Other Balance at End

Description Balance at Beginning of Period Additions Charged to Costs and Expenses Deductions Acquisitions and Other Balance at End of Period

ALLOWANCE FOR DOUBTFUL ACCOUNTS:

Year ended December 31, 2019 $ 57,207 $ 12,088 $ ( 18,308 ) $ 1,698 $ 52,685

Year ended December 31, 2018 57,609 13,970 ( 15,945 ) 1,573 57,207

(1) The 2020 information is omitted from the table above as the information has been provided in "Allowance for Credit Losses" in Note 4, "Summary of Significant Accounting Policies," to the consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K.

(1) The 2020 and 2021 information is omitted from the table above as the information has been provided in "Allowance for Credit Losses" in Note 3, "Summary of Significant Accounting Policies," to the Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.

(a)(3) Exhibits

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Included in the exhibits listed therein are the following exhibits which constitute management contracts or compensatory plans or arrangements:

Exhibit Number Description

LKQ Corporation 401(k) Plus Plan dated August 1, 1999.

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Form of LKQ Corporation Restricted Stock Unit Agreement for Non-Employee Directors.

Form of LKQ Corporation Restricted Stock Unit Agreement for Employees.

Form of LKQ Corporation Performance-Based Restricted Stock Unit Agreement (PSU 1 Award).

5 unchanged sentences

Form of Indemnification Agreement between directors and officers of LKQ Corporation and LKQ Corporation.

Amended and Restated LKQ Corporation Long Term Incentive Plan.

Form of LKQ Corporation Executive Officer Long Term Incentive Plan Award Memorandum.

Change of Control Agreement between LKQ Corporation and Walter P.

8 unchanged sentences

Jude dated as of May 13, 2015.

Change of Control Agreement between LKQ Corporation and Ashley T.

Brooks dated as of May 2, 2016.

Change of Control Agreement between LKQ Corporation and Matthew J.

4 unchanged sentences

Brooks dated as of January 31, 2020.

Change of Control Agreement between LKQ Corporation and Genevieve L.

Dombrowski dated as of March 22, 2021.

LKQ Severance Policy for Key Executives.

7 unchanged sentences

Services Agreement dated as of June 1, 2020 between LKQ Europe GmbH, an indirect wholly-owned subsidiary of LKQ Corporation, and Arnd Franz.

Exhibit Number Description

Restated Certificate of Incorporation of LKQ Corporation (incorporated herein by reference to Exhibit 3.1 to the Company’s report on Form 10-Q filed with the SEC on October 31, 2014).

12 unchanged sentences

4 dated as of June 11, 2020 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, LKQ Delaware LLP, and certain additional subsidiaries of LKQ Corporation, as borrowers, certain financial institutions, as lenders, and Wells Fargo Bank, National Association, as administrative agent (incorporated herein by reference to Exhibit 4.1 to the Company's report on Form 8-K filed with the SEC on June 16, 2020).

Amendment No.

5 dated as of December 14, 2020 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 (incorporated by reference to Exhibit 4.1 to the Company’s report on Form 10-Q filed with the SEC on May 5, 2021).

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 (incorporated by reference to Exhibit 4.1 to the Company’s report on Form 8-K filed with the SEC on November 30, 2021).

Indenture dated as of April 14, 2016 among LKQ Italia Bondco S.p.A., as Issuer, LKQ Corporation, certain subsidiaries of LKQ Corporation, the Trustee, and the Paying Agent, Transfer Agent and Registrar (incorporated herein by reference to Exhibit 4.1 to the Company’s report on Form 8-K filed with the SEC on April 18, 2016).

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and the Trustee (incorporated herein by reference to Exhibit 4.4 to the Company’s report on Form 10-Q filed with the SEC on August 2, 2016).

Exhibit Number Description

Supplemental Indenture dated as of June 13, 2016 among Bertolotti S.p.A., LKQ Corporation, LKQ Italia Bondco S.p.A.

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Supplemental Indenture dated as of June 21, 2019 among LKQ European Holdings B.V., as Issuer, LKQ Corporation, certain subsidiaries of LKQ Corporation, as Guarantors, and BNP Paribas Trust Corporation UK Limited, as Trustee (incorporated herein by reference to Exhibit 4.2 to the Company's report on Form 10-Q filed with the SEC on August 2, 2019).

Description of the Company's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934.

Description of the Company's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated herein by reference to Exhibit 4.21 to the Company's report on Form 10-K filed with the SEC on February 26, 2021).

LKQ Corporation 401(k) Plus Plan dated August 1, 1999 (incorporated herein by reference to Exhibit 10.23 to the Company’s Registration Statement on Form S-1, Registration No.

6 unchanged sentences

LKQ Corporation 1998 Equity Incentive Plan, as amended (incorporated herein by reference to Exhibit 10.1 to the Company’s report on Form 10-Q filed with the SEC on November 1, 2016).

Form of LKQ Corporation Restricted Stock Unit Agreement for Non-Employee Directors.

Form of LKQ Corporation Restricted Stock Unit Agreement for Non-Employee Directors (incorporated herein by reference to Exhibit 10.6 to the Company's report on Form 10-K filed with the SEC on February 26, 2021).

Form of LKQ Corporation Restricted Stock Unit Agreement for Employees.

Form of LKQ Corporation Performance-Based Restricted Stock Unit Agreement (PSU 1 Award) (incorporated herein by reference to Exhibit 10.7 to the Company's report on Form 10-K filed with the SEC on February 27, 2020).

Exhibit Number Description

Form of LKQ Corporation Performance-Based Restricted Stock Unit Agreement (PSU 2 Award) (incorporated herein by reference to Exhibit 10.8 to the Company's report on Form 10-K filed with the SEC on February 27, 2020).

1 unchanged sentence

Form of LKQ Corporation Annual Cash Bonus Award Memorandum (incorporated herein by reference to Exhibit 10.10 to the Company's report on Form 10-K filed with the SEC on February 27, 2020).

Form of LKQ Corporation Long-Term Cash Incentive Award Memorandum.

Form of LKQ Corporation Long-Term Cash Incentive Award Memorandum (incorporated herein by reference to Exhibit 10.11 to the Company's report on Form 10-K filed with the SEC on February 26, 2021).

Form of LKQ Corporation Performance-Based Restricted Stock Unit Agreement (incorporated herein by reference to Exhibit 10.9 to the Company's report on Form 10-K filed with the SEC on February 28, 2018).

1 unchanged sentence

333-107417 filed with the SEC on July 28, 2003).

Amended and Restated LKQ Corporation Long Term Incentive Plan (incorporated herein by reference to Exhibit 10.1 to the Company’s report on Form 8-K filed with the SEC on November 7, 2014).

Form of LKQ Corporation Executive Officer Long Term Incentive Plan Award Memorandum (incorporated herein by reference to Exhibit 10.15 to the Company's report on Form 10-K filed with the SEC on March 1, 2019).

Change of Control Agreement between LKQ Corporation and Walter P.

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Jude dated as of May 13, 2015 (incorporated herein by reference to Exhibit 10.32 to the Company’s report on Form 10-K filed with the SEC on February 25, 2016).

Change of Control Agreement between LKQ Corporation and Ashley T.

Brooks dated as of May 2, 2016 (incorporated herein by reference to Exhibit 10.1 to the Company’s report on Form 10-Q filed with the SEC on August 2, 2016).

Change of Control Agreement between LKQ Corporation and Matthew J.

4 unchanged sentences

Brooks dated as of January 31, 2020 (incorporated herein by reference to Exhibit 10.26 to the Company's report on Form 10-K filed with the SEC on February 27, 2020).

Change of Control Agreement between LKQ Corporation and Genevieve L.

Dombrowski dated as of March 22, 2021.

LKQ Severance Policy for Key Executives (incorporated herein by reference to Exhibit 10.1 to the Company’s report on Form 8-K filed with the SEC on July 28, 2014).

1 unchanged sentence

Receivables Purchase Agreement dated as of September 28, 2012 among LKQ Receivables Finance Company, LLC, as Seller, LKQ Corporation, as Servicer, Victory Receivables Corporation, as a Conduit and The Bank of Tokyo-Mitsubishi UFJ, Ltd., as a Financial Institution, as Administrative Agent and as a Managing Agent (incorporated herein by reference to Exhibit 10.2 to the Company’s report on Form 8-K filed with the SEC on October 4, 2012).

Exhibit Number Description

Amendment No.

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101.PRE XBRL Taxonomy Extension Presentation Linkbase Document

104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

FORM 10-K SUMMARY

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Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on February 25, 2022.

Principal Executive Officer:

/s/ DOMINICK ZARCONE President and Chief Executive Officer

/s/ DOMINICK ZARCONE President and Chief Executive Officer, Director

Dominick Zarcone

Principal Financial Officer:

(Principal Executive Officer)

/s/ VARUN LAROYIA Executive Vice President and Chief Financial Officer

Varun Laroyia

Principal Accounting Officer:

(Principal Financial Officer)

/s/ MICHAEL S.

CLARK Vice President—Finance and Controller

A Majority of the Directors:

(Principal Accounting Officer)

/s/ PATRICK BERARD Director

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MILLER Director

O'BRIEN Director

/s/ GUHAN SUBRAMANIAN Director

3 unchanged sentences

/s/ JACOB WELCH Director

/s/ DOMINICK ZARCONE Director

Dominick Zarcone

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures