8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  January 11, 2008

LKQ CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	000-50404	36-4215970
(State or other jurisdiction of	(Commission	(IRS Employer
incorporation or organization)	File Number)	Identification No.)
120 North LaSalle Street, Suite 3300
Chicago, IL		60602
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code:  (312) 621-1950

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02.   DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS

                (e) The Compensation Committee of our Board of Directors approved the grant of restricted stock to certain of our officers, including certain of our named executive officers, under our 1998 Equity Incentive Plan. The effective date of the grant was January 11, 2008. The number of shares of restricted stock granted to our named executive officers who received grants was:

Name	Number of Shares
Joseph M. Holsten	80,000
Mark T. Spears	25,000
Walter P. Hanley	25,000

                Until the shares of restricted stock vest, they may not be sold, pledged or otherwise transferred and are subject to forfeiture upon the recipient’s voluntary termination of employment or termination for cause. The restricted stock granted as of January 11, 2008 vests with respect to 20% of the shares subject to the grant on each anniversary of the grant date over a five-year period.

                The above-described grants represent the first grants of restricted stock under the 1998 Equity Incentive Plan. Prior to these grants, only grants of stock options were made under the plan.  Each grant is subject to the terms and conditions of a Restricted Stock Agreement.  A copy of the form of Restricted Stock Agreement adopted by the Compensation Committee is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

                The Compensation Committee also approved, and we entered into as of January 11, 2008 with Joseph M. Holsten, our President and Chief Executive Officer, a Consulting Agreement. The term of the Consulting Agreement commences on the date that Mr. Holsten ceases to be employed by us and ends five years thereafter, unless the agreement is earlier terminated by Mr. Holsten for any reason or by us for cause. The compensation to Mr. Holsten during the term will be $200,000 annually.

                Under the Consulting Agreement, Mr. Holsten will be required to consult with our Board of Directors regarding our strategies and operations. In addition, Mr. Holsten will be subject to non-compete and confidentiality provisions during the five year period commencing on the effective date of the agreement, even if the agreement is terminated earlier.

                A copy of the Consulting Agreement is attached hereto as Exhibit 10.2 and is incorporated herein by reference.

Item 9.01.   FINANCIAL STATEMENTS AND EXHIBITS

(d) Exhibits

Exhibit Number	Description of Exhibit
10.1	Form of Restricted Stock Agreement.
10.2	Consulting Agreement dated as of January 11, 2008 between LKQ Corporation and Joseph M. Holsten.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated:   January 17, 2008

LKQ CORPORATION
By:	/s/ VICTOR M. CASINI
	Victor M. Casini
	Vice President and General Counsel

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EX-10.1

Exhibit 10.1

RESTRICTED STOCK AGREEMENT

                This Restricted Stock Agreement (this “Agreement”) is made and entered into as of the        day of                     ,                by and between LKQ Corporation, a Delaware corporation (the “Company”), and                                (the “Key Person”).

Recitals

                The Board of Directors of the Company is of the opinion that the interests of the Company will be advanced by encouraging certain persons affiliated with the Company, upon whose judgment, initiative and efforts the Company is largely dependent for the successful conduct of the Company’s business, to acquire or increase their proprietary interest in the Company, thus providing them with a more direct stake in its welfare and assuring a closer identification of their interests with those of the Company.

                The Board of Directors of the Company is of the opinion that the Key Person is such a person.

                The Company desires to grant shares of restricted stock to the Key Person, and the Key Person desires to accept such grant, all on the terms and subject to the conditions set forth in this Agreement and set forth in the Company’s 1998 Equity Incentive Plan, a copy of which is attached hereto as Exhibit A (the “Plan”).

Covenants

                NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows:

1.             Grant of Restricted Stock.  The Company hereby grants to the Key Person and the Key Person hereby accepts from the Company              shares of common stock of the Company, on the terms and subject to the conditions set forth herein and in the Plan (the “Restricted Shares”).

2.             Representation of the Key Person.  The Key Person hereby represents and warrants that the Key Person has been provided a copy of the Plan and is accepting the Restricted Shares with full knowledge of and subject to the restrictions contained in this Agreement and the Plan.

3.             Restricted Period.  Each of the Restricted Shares shall be subject to the restrictions on transfer set forth in Section 4 below and shall be subject to forfeiture pursuant to Section 5 below during the period that such Restricted Share is not vested (the “Restricted Period”).  The Restricted Shares shall vest in the following amounts and on the following dates:                                                                                                         .

4.             Non-Transferability of Restricted Shares. Except as expressly provided in the Plan or this Agreement, prior to the expiration of the Restricted Period described in Section 3 with respect to a Restricted Share, such Restricted Share may not be sold, assigned, transferred, pledged or otherwise disposed of, shall not be assignable by operation of law, and shall not be subject to execution, attachment or similar process, except by will or the laws of descent and distribution.  Any attempted sale, assignment, transfer, pledge or other disposition of any Restricted Share subject to any applicable portion of the Restricted Period shall be null and void and without effect.  Notwithstanding the expiration of the applicable portion of the Restricted Period, the vested portion of the Restricted Shares shall be transferred only pursuant to an effective registration statement under applicable federal and state securities laws or an applicable exemption from registration under such laws.

5.             Forfeiture.  Upon the Key Person’s voluntary termination of employment with the Company or any of its affiliates, or upon the termination of the Key Person’s employment with the Company or any of its affiliates for “Cause” (as defined in the Plan), which event occurs, in either case, on a date prior to the expiration of any applicable portion of the Restricted Period described in Section 3, any non-vested Restricted Shares (determined in accordance with Section 3) shall be forfeited by the Key Person to the Company without any consideration therefor.  The Key Person’s employment shall not be considered terminated in the event the Key Person is transferred to, and becomes an employee of, a subsidiary of the Company.

6.             Taxes.  The Key Person is responsible for taxes due upon the expiration of any portion of the Restricted Period and on any gain upon transfer of the Restricted Shares.  The Key Person acknowledges receipt of a section 83(b) election form and will consult with the Company regarding the information to be provided on such form if the Key Person elects to file such form.  The Key Person acknowledges that the Section 83(b) election form must be filed with the Internal Revenue Service within 30 days of the date hereof.

7.             Rights as a Stockholder.  The Company will retain the certificate or certificates representing the Restricted Shares in the Company’s possession until such time as all restrictions applicable to such Restricted Shares have lapsed.  The Company shall hold in escrow all dividends, if any, that are paid with respect to the Restricted Shares until all restrictions on such shares have lapsed.  The Key Person shall have the right to vote the Restricted Shares during the Restricted Period.

8.             Notices.  Any notices required or permitted hereunder shall be deemed given only when delivered personally or when deposited in the United States Post Office as certified mail, postage prepaid, addressed, as appropriate, if to the Key Person, at the address set forth below or such other address as the Key Person may designate in writing to the Company, and, if to the Company, at 120 North LaSalle Street, Suite 3300, Chicago, Illinois 60602, Attention: General Counsel, or such other address as the Company may designate in writing to the Key Person.

9.             Failure to Enforce Not a Waiver.  The failure of the Company to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

10.           Amendment or Termination.  This Agreement may not be amended or terminated unless such amendment or termination is in writing and duly executed by each of the parties hereto.

11.           Benefit and Binding Effect.  This Agreement shall be binding upon and shall inure to the benefit of the Company, its successors and assigns, and the Key Person and the Key Person’s executors, administrators, personal representatives and heirs.  In the event that any part of this Agreement shall be held to be invalid or unenforceable, the remaining parts hereof shall nevertheless continue to be valid and enforceable as though the invalid portions were not a part hereof.

12.           Entire Agreement.  This Agreement contains the entire understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior agreements, discussions and understandings relating to such subject matter.

13.           Governing Law.  This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Illinois, without giving effect to principles and provisions thereof relating to conflict or choice of laws.

14.           Incorporation of Terms of Plan.  The terms of the Plan are incorporated herein by reference and the Key Person’s rights hereunder are subject to such terms to the extent they are inconsistent with or in addition to the terms set forth herein, and the Key Person hereby agrees to comply with all requirements of the Plan.

15.           Legend.  The Company’s Secretary shall, or shall instruct the Company’s transfer agent to, provide stop transfer instructions in the Company’s stock records to prevent any transfer of the Restricted Shares for any purpose until the stock is vested.  Any certificate representing the Restricted Shares shall, until all restrictions lapse and new certificates are issued, bear the following legend:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN VESTING REQUIREMENTS AND MAY BE SUBJECT TO FORFEITURE UNDER THE TERMS OF THAT CERTAIN RESTRICTED STOCK AGREEMENT BY AND BETWEEN THE COMPANY AND THE HOLDER OF THE SECURITIES.  PRIOR TO VESTING, THE SECURITIES MAY NOT BE, DIRECTLY OR INDIRECTLY, OFFERED, TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNDER ANY CIRCUMSTANCES.  A COPY OF THE ABOVE- REFERENCED AGREEMENT IS ON FILE AT THE OFFICES OF THE COMPANY, 120 NORTH LASALLE STREET, SUITE 3300, CHICAGO, ILLINOIS 60602.

16.           Non-Competition and Confidentiality.  (a) Notwithstanding any provision to the contrary set forth elsewhere herein, the Restricted Shares or any gain realized by the Key Person upon the sale of the Restricted Shares shall be forfeited by the Key Person to the Company without any consideration therefor, if the Key Person is not in compliance, at any time during the period commencing on the date of this Agreement and ending one year after the date that all of the Restricted Shares have become vested, with all applicable provisions of the Plan and with the following conditions:

                (i)            the Key Person shall not directly or indirectly (1) be employed by, engage or have any interest in any business which is or becomes competitive with the Company or is or becomes otherwise prejudicial to or in conflict with the interests of the Company or its subsidiaries, (2) induce any customer of the Company or its subsidiaries to patronize such competitive business or otherwise request or advise any such customer to withdraw, curtail or cancel any of its business with the Company or its subsidiaries, or (3) solicit for employment any person employed by the Company or its subsidiaries; provided, however, that this restriction shall not prevent the Key Person from acquiring and holding up to two percent of the outstanding shares of capital stock of any corporation which is or becomes competitive with the Company or is or becomes otherwise prejudicial to or in conflict with the interests of the Company if such shares are available to the general public on a national securities exchange or in the over-the-counter market; and

                (ii)           the Key Person shall not use or disclose, except for the sole benefit of or with the written consent of the Company, any confidential information relating to the business, processes or products of the Company.

                (b)           The Company shall notify in writing the Key Person of any violation by the Key Person of this Section 16.  The forfeiture shall be effective as of the date of the occurrence of any of the activities set forth in (a) above.  If the Restricted Shares have been sold, the Key Person shall promptly pay to the Company the amount of any gain realized upon the sale of the Restricted Shares.  The Key Person hereby consents to a deduction from any amounts owed by the Company to the Key Person from time to time

(including amounts owed as wages or other compensation, fringe benefits or vacation pay) to the extent of the amounts owed by the Key Person to the Company under this Section 16.  Whether or not the Company elects to make any set-off in whole or in part, the Key Person agrees to timely pay any amounts due under this Section 16.

                IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

LKQ CORPORATION	KEY PERSON
By:	By:
Name:	Name:
Title:	Address:

EX-10.2

Exhibit 10.2

CONSULTING AGREEMENT

This Consulting Agreement (the “Agreement”) dated as of this 11^th day of January, 2008 between LKQ Corporation, a Delaware corporation (hereinafter referred to as the “Company”), and Joseph M. Holsten (hereinafter referred to as “Consultant”).

WITNESSETH

                WHEREAS, Consultant is currently the President and Chief Executive Officer of the Company;

                WHEREAS, the Company desires to avail itself of the experience, knowledge and judgment of Consultant for a period of time after Consultant is no longer an employee of the Company; and

                WHEREAS, Consultant is willing to perform consulting services for the Company as an independent contractor upon the terms and conditions herein set forth.

                NOW, THEREFORE, for and in consideration of the mutual covenants contained herein, the Company hereby agrees to engage Consultant and Consultant hereby agrees to accept such engagement upon the following terms and conditions:

                1.             Term.  The “Term” shall mean the period commencing on the date that Consultant ceases to be an employee of the Company or any of its affiliates and ending on the earlier of the five year anniversary of such date or the death of Consultant, unless earlier terminated by Consultant for any reason or by the Company for “Cause” (as defined in the Company’s 1998 Equity Incentive Plan).

                2.             Duties and Responsibilities.  During the Term, Consultant shall consult with the Board of Directors regarding the Company’s strategies and operations.  During the Term, the Company shall not require Consultant to devote more than three business days per month toward Consultant’s duties and responsibilities under this Agreement.  After the Term, neither the Company nor Consultant shall have any further obligations hereunder except, in the case of Consultant, the obligations pursuant to paragraph 4 hereof.

                3.             Compensation During the Term.  During the Term, the Company agrees to pay Consultant at the rate of $200,000 annually.

                4.             Non-Competition and Confidentiality.  Consultant agrees that:

                                (a)           During the five year period that initially comprises the Term (notwithstanding any earlier termination of the Term in accordance with paragraph 1 hereof), the Consultant shall not (i) engage in, represent, furnish consulting services to, be employed by or have any interest in (whether as owner, principal, director, officer, partner, agent, consultant, shareholder, member or otherwise) any business which would be competitive with any business conducted by the Company, provided, however, that the Consultant may acquire and hold an aggregate of up to two percent of the outstanding shares of any corporation engaged in any such business if such shares are publicly traded in an established securities market, (ii) induce any customer of the Company or its subsidiaries to patronize any such competitive business or otherwise request or advise any such customer to withdraw, curtail or cancel any of its business with the Company or its subsidiaries, or (iii) solicit for employment, or assist any other person in soliciting for employment, any person employed by the Company or any of its affiliates, or (iv) use or disclose, except for the sole benefit of or with the written consent of the Company, any confidential information relating to the business, processes or products of the Company.

(b)           If any provision of Section 4(a), as applied to any party or to any circumstances, is adjudged by a court to be invalid or unenforceable, the same shall in no way affect any other provision or any other part of this Agreement, the application of such provision in any other circumstances or the validity or enforceability of this Agreement.  If any such provision, or any part thereof, is held to be unenforceable because of the duration of such provision or the area covered thereby, the parties agree that the court making such determination shall have the power to reduce the duration and/or area of such provision, and/or to delete specific words or phrases, and in its reduced form such provision shall then be enforceable.  Upon breach of any provision of Section 4(a), the Company and the Consultant shall be entitled to injunctive relief, since the remedy at law would be inadequate and insufficient.  In addition, they shall be entitled to such damages as they can show they have sustained by reason of such breach.

                5.             Notices.  Any notice required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given when deposited in the U.S. Mail in a registered, postage prepaid envelope addressed, if to Consultant at Consultant’s address set forth below, and if to the Company, c/o General Counsel, 120 North LaSalle Street, Chicago, Illinois 60602, or to such other addresses as either party shall designate by written notice to the other.

                6.             Assignment.  Consultant may not assign Consultant’s rights or obligations hereunder.  The rights and obligations of the Company hereunder shall inure to the benefit of and shall be binding upon its successors and assigns.

                7.             Independent Contractor.  During the Term, Consultant shall be an independent contractor, not an employee or agent, of the Company.  Nothing in this Agreement shall render Consultant an employee or agent of the Company, nor authorize or empower Consultant to speak for, represent or obligate the Company in any way.  Consultant shall execute and deliver to the Company any forms requires by the Internal Revenue Service to indicate that the Company has no obligation to withhold any taxes with respect to Consultant during the Term.

                8.             (a)           This Agreement shall be subject to and governed by the laws of the State of Illinois.

                                (b)           Failure to insist upon strict compliance with any provision(s) hereof shall not be deemed a waiver of such provision(s) or any other provision hereof.

                                (c)           This Agreement may not be modified except by an agreement in writing executed by the parties hereto.

                                (d)           The invalidity or uneforceability of any provision hereby shall not affect the validity or enforceability of any other provisions.

                                IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

LKQ CORPORATION
By:	/s/ Victor M. Casini
Name: Victor M. Casini
Title: Vice President
CONSULTANT
/s/ Joseph M. Holsten
Joseph M. Holsten
12200 1st Street West
Suite 301
Treasure Island, Florida 33706