1065696--2/28/2007--LKQ

related topics

{financial, litigation, operation}

{stock, price, operating}

{cost, regulation, environmental}

{customer, product, revenue}

{acquisition, growth, future}

{competitive, industry, competition}

{stock, price, share}

{provision, law, control}

{personnel, key, retain}

{system, service, information}

{property, intellectual, protect}

{tax, income, asset}

{product, liability, claim}

{debt, indebtedness, cash}

{cost, contract, operation}

Risks Relating to Our Business We face intense competition from local, national, and internet-based light vehicle products providers, and this competition could negatively affect our business. An adverse change in our relationships with auction companies or our suppliers could increase our expenses and hurt our ability to serve our customers. We may not be able to sell our products due to existing or new laws and regulations prohibiting or restricting the sale of recycled OEM or aftermarket products. If our business relationships with insurance companies end, we may lose important sales opportunities. We are subject to environmental regulations and incur costs relating to environmental matters. Governmental agencies may refuse to grant or renew our operating licenses and permits. Proposed regulations under the National Stolen Passenger Motor Vehicle Information System could harm our business. We could be subject to product liability claims. We may lose business if recent litigation involving the use of aftermarket parts results in insurance companies modifying arrangements affecting the use of recycled OEM or aftermarket products in the repair process. If the number of vehicles involved in accidents declines, our business could suffer. We may not be able to successfully acquire new operations or integrate future acquisitions, which could cause our business to suffer. Our credit facility imposes certain operating and financial restrictions on us and our subsidiaries and requires us to meet certain financial tests. Our future capital needs may require that we seek debt financing or additional equity funding that, if not available, could cause our business to suffer. Our annual and quarterly performance may fluctuate. If we lose our key management personnel, we may not be able to successfully manage our business or achieve our objectives. We rely on information technology in critical areas of our operations and a disruption relating to such technology could harm our business. If we experience problems with our fleet of trucks, our business could be harmed. If we determine that our goodwill has become impaired, we may incur significant charges to our pre-tax income. Challenges to the validity of aftermarket products could adversely effect our business. Risks Relating to Our Common Stock Our executive officers, directors, and their affiliates hold a large percentage of our stock and their interests may differ from other stockholders. Future sales of our common stock may depress our stock price. Delaware law and our charter documents may impede or discourage a takeover, which could affect the price of our stock.

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1065696--2/28/2007--LKQ_CORP