UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the ~~Securities Exchange Act of 1934~~

~~Date~~Securities ofExchange ~~report~~Act ~~(Date~~ of 1934 ~~earliest event reported): February 26, 2009~~

Date of report (Date of earliest event reported): January 10, 2011

Keystone Automotive Operations, Inc.

(Exact ~~Name~~name of ~~Registrant~~registrant Asas ~~Specified~~specified Inin ~~Charter~~its charter)

Pennsylvania	333-112252	23-2950980
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
44 Tunkhannock Avenue Exeter, Pennsylvania 18643 (Address of Principal Executive Offices, including Zip Code)
(800) 233-8321 (Registrant’s telephone number, including area code)
Not applicable (Former Name or Former Address, if Changed Since Last Report)

44 Tunkhannock Avenue

Exeter, Pennsylvania 18643

(Address of Principal Executive Offices, including Zip Code)

(800) 233-8321

(Registrant’s telephone number, including area code)

Not applicable

(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):

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

¨ ~~Soliciting~~Written ~~material~~communications pursuant to Rule ~~14a-12~~425 under the ~~Exchange~~Securities Act (17 CFR ~~240~~230.~~14a-12~~425)

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

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

Item 1.01. Entry into Material Definitive ~~Agreement~~Agreements.

On ~~February~~ January 2610, ~~2009~~2011, Keystone Automotive ~~Holdings~~Operations, Inc., (“A&A Auto Parts Stores, Inc.; American Specialty Equipment Corp.; Arrow Speed Acquisition, LLC; DriverFx.com, Inc.; KAO Management Services, LLC; KeyComp, Inc.; Keystone Automotive Distributors Company, LLC; Keystone Automotive Holdings”), ~~the~~Inc.; ~~corporate~~Keystone ~~parent~~Automotive ~~company~~Operations of Canada, Inc.; and Keystone Automotive Operations Midwest, Inc. (collectively, the “Company”), entered into ana ~~employment~~Restructuring ~~agreement~~Support Agreement (the “Support Agreement”) with Sphere Capital, LLC – Series A and Cetus Capital, LLC (collectively, the “Consenting Holders”). Subject to certain conditions, the Support ~~Richard~~Agreement Sprovides, among other things, for the restructuring (the “Restructuring”) of the 9.75% ~~Paradise~~Senior inSubordinated ~~connection~~Notes ~~with~~due Mr2013 (the “Senior Subordinated Notes”), the 8.0% Junior Subordinated Notes due 2011 and all of the equity interests of Keystone Automotive Holdings, Inc. through either (i) ~~Paradise’s~~an ~~appointment~~out-of-court asexchange ~~financial~~offer ~~senior~~(the ~~vice~~“Exchange ~~president~~Offer”) or (ii) a prearranged or prepackaged plan of reorganization (the “Prepackaged Plan”) under chapter 11 of title 11 of the United States Code (“Chapter 11”). The terms of the Restructuring, under both the Exchange Offer and ~~his~~the ~~future~~Prepackaged ~~appointment~~Plan, ascontemplate ~~Chief~~paying ~~Financial~~all ~~Officer~~trade suppliers and ~~Executive~~employees ~~Vice~~in ~~President~~full and continuing to operate the Company’s business in the ordinary course. Subject to earlier termination, the Support Agreement will automatically terminate upon the earlier of ~~Holdings~~the ~~and~~consummation of the ~~Company~~Restructuring and June 15, 2011.

~~Mr. Paradise,~~Pursuant ~~47,~~to ~~joins~~ the ~~Company~~Support ~~with more than twenty years of finance experience~~Agreement, ~~most recently serving as~~ the ~~Senior~~Consenting ~~Vice~~Holders ~~and~~have ~~Chief Financial Officer of The Children’s Place Retail Stores~~agreed, ~~Inc.~~among ~~from~~other ~~November~~things: 2007 to August 2008. Previously, Mr. Paradise served American Standard Companies, Inc. as Vice President and Chief Financial Officer of the Bath & Kitchen division from August 2005 to October 2007 and for the three years prior to that as Corporate Vice-President and Controller.

~~Pursuant~~• to ~~the Agreement,~~promptly ~~Mr. Paradise~~tender ~~will~~all ~~serve~~their ~~as Financial~~ Senior ~~Vice~~Subordinated ~~President~~Notes of Holdings until April 6, 2009, at which time he will be appointed as Chief Financial Officer and Executive Vice President. Holdings’ Interim Chief Financial Officer, Stuart B. Gleichenhaus, will resign at that time. The Agreement provides that Mr. Paradise will receive a base salary of at least $350,000 and that his base salary shall be subject to review by Holdings’ board of directors on an annual basis. Under the terms of the Agreement, following each year during the term of his employment, Mr. Paradise will be eligible to receive an annual bonus to be determined by the board of directors of Holdings, with the bonus amount targeted at 70% of his base salary. Actual bonus payments will be based upon his performance and Holdings’ achievement of operating targets established by the board of directors of Holdings in consultation with Mr. Paradise. The Agreement provides for an initial three-year term that will automatically extend for successive additional one year terms unless either party gives at least 90 days prior written notice of non-renewal. The Agreement also contains provisions regarding participation in employee benefit plans, vacation time, reimbursement of business expenses, protection of confidential information and ownership of intellectual property and employee work product. In addition, the ~~Agreement~~Exchange contains a covenant not to compete and a covenant regarding non-solicitation and non-interference with respect to employees, customers and suppliers. If Mr. Paradise’s employment terminates as a result of his death or disability (as defined in the Agreement), or if his employment is terminated by Holdings without cause (as defined in the Agreement) or by him for good reason (as defined in the Agreement), then Mr. Paradise will be entitled under the Agreement to receive severance payments equal to one year’s base salary plus a pro rata portion of his target bonus for the year in which his employment ends, to the extent that targets are achieved after his termination, and to continue to participate in Holdings’ health and insurance benefit plans for a period of one year. Offer;

~~Item~~• ~~5.02~~to ~~Departure~~timely vote all of ~~Directors~~their orclaims ~~Certain~~to ~~Officers;~~accept ~~Election~~the ofPrepackaged ~~Directors;~~Plan ~~Appointment~~and ofnot ~~Certain~~to ~~Officers;~~revoke ~~Compensatory~~any ~~Arrangements~~such ofvote ~~Certain~~unless ~~Officers.~~and until the Support Agreement is terminated in accordance with its terms; and

~~The~~• ~~disclosure~~to ~~required~~not bysupport, ~~this~~directly ~~item~~or isindirectly, ~~included~~any inrestructuring ~~Item 1.01~~or reorganization of ~~this~~the ~~Current~~Company ~~Report~~other onthan ~~Form~~the ~~8-K~~Exchange Offer and isthe ~~incorporated~~Prepackaged ~~herein by reference~~Plan.

2Pursuant to the Support Agreement, the Company has agreed, among other things:

•

to commence the Exchange Offer on or before February 15, 2011;

•

not to propose, support, assist, engage in negotiations in connection with or participate in the formulation of, any restructuring or reorganization of the Company other than the Restructuring; provided, however, that the Company may terminate the Support Agreement if it reasonably determines that proceeding with the Restructuring would be a breach of its fiduciary duties or applicable law;

•

to place certain restrictions on certain of its actions such as issuing securities, making capital expenditures and incurring indebtedness prior to the consummation of the Restructuring;

•

to pay certain fees and expenses of the legal advisors to the Consenting Holders;

•

to have at least $55.0 million in liquidity following the consummation of the Restructuring; and

•

to commence Chapter 11 cases, solely to the extent necessary, by March 15, 2011.

In the event that the Company pursues the Restructuring pursuant to the Prepackaged Plan, the Company has agreed, among other things:

•

to obtain, in accordance with the terms of the Support Agreement, entry of a bankruptcy court order approving a disclosure statement and related solicitation materials, and setting a hearing to consider confirmation of a proposed plan of reorganization within 40 days of commencing the Chapter 11 cases;

•

to commence a hearing to consider the proposed plan of reorganization within 40 days of entry of the bankruptcy court order approving the disclosure statement;

•

to obtain a bankruptcy court order confirming the Company’s proposed plan of reorganization within 35 days of the date of the bankruptcy court hearing to consider the proposed plan of reorganization; and

•

to ensure that the effective date of the proposed plan of reorganization occurs no later than 20 days after the date the proposed plan of reorganization is confirmed by the bankruptcy court.

In connection with the Support Agreement, on January 10, 2011, the Company also entered into a Backstop Stock Purchase Agreement (the “Purchase Agreement”) with the Consenting Holders to facilitate the offering (the “Rights Offering”) of $60.0 million of non-transferable, non-certificated rights (“Rights”) to acquire shares of the new common stock of the restructured Company (the “Shares”) in conjunction with the proposed Restructuring. Pursuant to the Purchase Agreement, the Consenting Holders have agreed to purchase Rights to acquire any Shares that are not sold in the Rights Offering, at the exercise price applicable to the purchase of such Shares. In exchange for this commitment, the Company has agreed to provide the Consenting Holders a backstop commitment fee equal to 6% of the Shares offered through the Rights Offering solely to the extent the Rights Offering is consummated.

The foregoing summary description of the Support Agreement and the Purchase Agreement and the transactions contemplated thereby does not purport to be complete and is subject to and qualified in its entirety by reference to the Support Agreement and the Purchase Agreement, copies of which are attached hereto as Exhibits 10.1 and 10.2 and the terms of which are incorporated herein by reference.

Item 3.03

Material Modification to Rights of Security Holders.

The information set forth in Item 1.01 is incorporated herein by reference.

Item 9.01.

Financial Statements and Exhibits.

(d) Exhibits:


Exhibit No.		Description
10.1		Restructuring Support Agreement, dated January 10, 2011, by and among A&A Auto Parts Stores, Inc.; American Specialty Equipment Corp.; Arrow Speed Acquisition LLC; DriverFx.com, Inc.; KAO Management Services, LLC; KeyComp, Inc.; Keystone Automotive Distributors Company, LLC; Keystone Automotive Holdings, Inc.; Keystone Automotive Operations, Inc.; Keystone Automotive Operations of Canada, Inc.; Keystone Automotive Operations Midwest, Inc., Sphere Capital, LLC – Series A and Cetus Capital, LLC


10.2		Backstop Stock Purchase Agreement, dated as of January 10, 2011, by and among A&A Auto Parts Stores, Inc.; American Specialty Equipment Corp.; Arrow Speed Acquisition LLC; DriverFx.com, Inc.; KAO Management Services, LLC; KeyComp, Inc.; Keystone Automotive Distributors Company, LLC; Keystone Automotive Holdings, Inc.; Keystone Automotive Operations, Inc.; Keystone Automotive Operations of Canada, Inc.; Keystone Automotive Operations Midwest, Inc., Sphere Capital, LLC – Series A and Cetus Capital, LLC, Sphere Capital, LLC – Series A and Cetus Capital, LLC

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report on Form 8-K to be signed on its behalf by the undersigned, thereunto duly authorized in the Borough of Exeter, Pennsylvania on ~~March~~January 414, ~~2009~~2011.

Keystone Automotive Operations, Inc. By: /s/ ~~Stuart~~Richard B.Paradise ~~Gleichenhaus~~Name: ~~Stuart~~Richard B.Paradise ~~Gleichenhaus~~Title: ~~Interim~~Executive Vice President and Chief Financial Officer

EXHIBIT INDEX


Exhibit No.		Description
10.1		Restructuring Support Agreement, dated January 10, 2011, by and among A&A Auto Parts Stores, Inc.; American Specialty Equipment Corp.; Arrow Speed Acquisition, LLC; DriverFx.com, Inc.; KAO Management Services, LLC; KeyComp, Inc.; Keystone Automotive Distributors Company, LLC; Keystone Automotive Holdings, Inc.; Keystone Automotive Operations, Inc.; Keystone Automotive Operations of Canada, Inc.; Keystone Automotive Operations Midwest, Inc., Sphere Capital, LLC – Series A and Cetus Capital, LLC

10.2		Backstop Stock Purchase Agreement, dated as of January 10, 2011, by and among A&A Auto Parts Stores, Inc.; American Specialty Equipment Corp.; Arrow Speed Acquisition, LLC; DriverFx.com, Inc.; KAO Management Services, LLC; KeyComp, Inc.; Keystone Automotive Distributors Company, LLC; Keystone Automotive Holdings, Inc.; Keystone Automotive Operations, Inc.; Keystone Automotive Operations of Canada, Inc.; Keystone Automotive Operations Midwest, Inc., Sphere Capital, LLC – Series A and Cetus Capital, LLC, Sphere Capital, LLC – Series A and Cetus Capital, LLC

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