LoJack Corporate Backgrounder

The year 2006 marked the 20th anniversary of LoJack Corporation (NASDAQ: LOJN), the premier worldwide provider of tracking and recovery systems, bringing its first product to market. Two decades ago, LoJack created the stolen vehicle recovery category and has since earned a reputation as the proven global leader in that market. From its inception, LoJack's primary core strengths - and market differentiators - have been its use of Radio Frequency technology, which has proven to be the best technology for tracking and recovery, and the System's direct integration with law enforcement agencies across the nation. These key advantages have enabled LoJack to deliver a better than 90 percent success rate in tracking and recovering stolen cars and trucks, amounting to more than $4 billion in recovered global assets.

Today, LoJack's core business comprises the tracking and recovery of a variety of valuable mobile assets including cars, trucks, construction equipment, commercial vehicles and motorcycles that leverage the company's unrivaled recovery solutions and direct integration with law enforcement. Additionally, LoJack is expanding into newer, emerging markets with innovative offerings in areas such as cargo security. Twenty years after the sale of the first LoJack unit, the company's systems are operable in the U.S. in 26 states and the District of Columbia and in 29 countries throughout the world.

The LoJack Difference

LoJack offers the right technology and processes to deliver the most effective solutions to the serious global problem of mobile asset theft. LoJack's systems for cars, trucks, construction equipment, commercial vehicles and motorcycles are based on time-tested Radio Frequency (RF) technology that is highly covert and highly effective - even if the asset is in a steel container, garage, chop shop or hidden under dense foliage.

Another key differentiator is LoJack's unique relationship with law enforcement agencies throughout the U.S., and in most countries where the company has licensees. The LoJack System was created specifically to operate within the processes and procedures of law enforcement to provide a highly effective, turn-key method for System activation and asset recovery. LoJack software and databases are directly integrated with each state's crime computers in the U.S., which expedites activation and tracking. Additionally, LoJack's Police Tracking Computers (PTCs) are installed in law enforcement vehicles, helicopters and fixed-wing aircraft to optimize tracking and recovery. Through the PTCs, a stolen asset communicates its whereabouts to authorities in real-time via RF technology that is emitted from the transponder hidden in the stolen asset. This vehicle-to-vehicle communication delivers unprecedented precision in "last mile" tracking.

Additionally, LoJack has a distinctive staff of more than 30 Law Enforcement Liaisons, all former police officers with a specialization in auto theft prevention, who work with law enforcement agencies in the fight against theft.

LoJack's tried and true process places recovery directly in the hands of law enforcement where it belongs. It is also acknowledged by many law enforcement professionals as the optimal method for the recovery of these types of assets. Because of the system's effectiveness, LoJack guarantees vehicle recovery with a 100 percent money-back promise.

Key Growth Initiatives: Domestic Focus

LoJack is focusing on increasing its penetration in its existing geographies - 26 states and the District of Columbia - in all three channels (automobiles, motorcycles, construction equipment).

Automotive Channel:
LoJack has focused much of its time and resources over the past few years on retooling its sales, marketing, distribution and installation processes - all with the goal of making it easier for automotive dealers to do business with LoJack. To date, LoJack has instituted programs designed to increase efficiency, help drive revenue in the dealer channel and enhance the reputation of automotive professionals. First and foremost are LoJack's Bulk Install, Certified Dealer Installation and Third Party Installation programs. These programs provide dealers with increased revenue opportunities, as well as a means of better servicing their customers. The Bulk Install Program not only helps increase dealers' penetration rate, but also protects their inventory from auto theft. This program has enabled LoJack to significantly improve penetration in the dealer channel, selling a higher volume of units per dealer.

In addition, LoJack is actively targeting and converting a segment of select, successful, high volume dealerships: import brands that are increasing their U.S. market share. Also, LoJack's emphasis on ethical selling at automotive dealerships is helping dealers to overcome the stigma of "least-trusted" professionals.*

Proof that LoJack's automotive channel strategy is successful is underscored by the company's continued ability - quarter after quarter - to outpace industry automobile sales.

Motorcycle Channel:
Motorcycle theft has risen at an alarming rate over the past few years** and the popularity of bike riding is at an all time high. In fact, the National Insurance Crime Bureau (NICB) reported that more than 70,000 motorcycles were stolen in 2005 - nearly a 135% increase over the past five years. Bike sales have also risen for 13 consecutive years. These two factors make LoJack For Motorcycles the right product at the right time. It is no surprise that LoJack For Motorcycles, introduced in early 2005 and now rolled out the company's existing markets, continues to gain consumer acceptance - as evidenced by strong sales and skyrocketing recoveries of LoJack-equipped motorcycles. In fact, in 2006, LoJack For Motorcycles led police to uncover 76 theft rings and recover nearly $3 million in stolen motorcycles.

LoJack For Motorcycles is not only helping bike enthusiasts get back their stolen motorcycles, the system also has been instrumental in uncovering emerging trends in motorcycle theft, such as the online sale of stolen bike parts.

Commercial/Construction Channel:
Theft of construction equipment is also a large and growing problem, with annual losses totaling $1 billion nationwide (NICB data). Construction equipment is highly vulnerable to theft because it is often located on remote, unsecured job sites and the equipment typically carries a high price tag, making it a profitable venture for organized crime rings. In an effort to help companies protect their equipment - and their business - from the costly problem of theft, LoJack offers its Ruggedized product line designed for heavy equipment and commercial vehicles.

LoJack continues to broaden and deepen its penetration in this channel with its dual focus on making new inroads with smaller organizations and expanding its relationships with larger commercial players. Additionally, the company continues to make enhancements to its Ruggedized products in an effort to constantly meet the changing needs of this market segment.

Innovations in New Areas:
LoJack has leveraged innovative strategies to broaden its brand strength in new channels and reach new segments of consumer and business audiences. Its 2005 licensing agreement with Absolute Software is one such example. This agreement enabled Absolute Software to market a product called LoJack for Laptops, further enhancing LoJack's powerful brand identity as the leader for effective tracking and recovering of valuable mobile assets.

In October 2006, LoJack announced its investment in the cargo security company SC-integrity, heralding its entrée into this emerging and potentially sizeable market with a partner that offers both security experience and a comprehensive solution that is well known and highly respected. As part of the agreement, LoJack has licensed the LoJack brand name to SC-integrity, which is marketing its current tracking and recovery service as LoJack inTransit.

LoJack's investment in SC-integrity is part of the company's long-term strategy to expand into new markets that provide opportunities for growth.

 Key Growth Initiatives: International Focus

The global market continues to be promising for LoJack's growth, with more than 66 million new vehicles sold internationally each year. As such, international expansion is one of LoJack's key growth strategies. To date, the company has achieved much success in this realm, with annual revenues growing 9.6% from 2005 to 2006. The company is continuing to work with existing licensees, while also beginning to own a controlling interest in select international markets that offer both a significant opportunity to establish and grow the LoJack business and to deliver recurring revenue from fees associated with the sale of LoJack Systems. Its current emphasis on the international front includes broadening its presence in Italy, focusing in high vehicle theft coutnries, leanding licensee collaboration and initiating operations in China.

Executing on this strategy, LoJack opened its first company-owned operation in Italy in June 2006 and continues to make measured progress in developing relationships with new car dealers and insurance companies in the greater Rome and Milan regions.

In the Canadian market, LoJack continues to strengthen its presence through Boomerang Tracking Inc., which it acquired in 2004. Boomerang continues to be a very strong brand in Quebec and Ontario. In 2006 it introduced Espion, a next-generation tracking technology based on its cellular model, which has helped the company partner more effectively with insurance companies in Quebec. Boomerang has also successfully penetrated the auto dealer market in Ontario using the LoJack domestic business model and has launched in the dealer channel in British Columbia.

Key Growth Initiatives: Technology and Products

Radio Frequency (RF) has withstood the test of time as the best technology for tracking and recovering mobile assets with unprecedented "last mile" precision. As such, RF will continue to be the core underlying technology for LoJack Systems for cars, trucks, construction equipment, commercial vehicles and motorcycles.

As LoJack embarks on new ventures, such as the cargo security arena, the company is evaluating the addition of other technologies into its mix that may be used in combination with RF - all with the goal of leveraging the best possible mix of technologies for each individual market and application. To that end, LoJack's expertise in cellular technology, which was gained through its acquisition of Boomerang Tracking Inc., may play an increasingly important role in the cargo security area.

In short, LoJack will be evaluating how technologies, such as RF, cellular and others may be used in combination to offer the best tracking and recovery capabilities for new markets and applications.

The Knowledge Center: An Education Destination for Theft Protection Information

Educating consumers about the nationwide problem of mobile asset theft is a top priority at LoJack. To help people learn what it takes to properly safeguard their cars, trucks, motorcycles, and construction equipment, LoJack has created The Knowledge Center -- an online destination residing on the LoJack website that provides Fast Facts, Surveys, Studies & Stats, and Tips & tools. There, LoJack also offers a series of theft protection booklets that can be downloaded from the site. The booklets include: "Street Smarts," which is aimed at all vehicle owners; "Bike Smarts," which is designed for motorcycle enthusiasts; "Site Smarts," which addresses protection of commercial equipment; and "Teen Smarts," geared for new drivers and parents of new drivers. To access the Knowledge Center, go to www.lojack.com and click on the box entitled "Get the Facts on Vehicle Theft."

Beginning in the summer of 2007 LoJack will team up with The National Insurance Crime Bureau (NICB), the nation's leading not-for-profit organization dedicated to fighting insurance fraud and vehicle theft, to launch a joint education initiative called the Vehicle Theft Protection Program. Since July is one of the highest vehicle theft months of the year, the program will kick off by naming July as "National Vehicle Theft Protection Month." As part of the program, LoJack and NICB will offer a variety of valuable information on vehicle theft protection that will be available on their websites.

LoJack: Ever More Vital in Today's World

LoJack has become the acknowledged expert in educating automotive and motorcycle consumers, commercial markets and the media on theft protection of mobile assets. The company's ongoing education program in each channel includes booklets on theft prevention, surveys, seminars, podcasts and annual theft studies - all of which are designed to inform consumers about the growing problem of theft and how to protect their mobile assets. To visit LoJack's Knowledge Center for Vehicle Security, go to www.lojack.com and click on the "Knowledge Center" button.

Over the past several years, LoJack has built a solid foundation for future growth. The strength of LoJack's business model indicates that the company's core competencies are more relevant than ever in today's world. LoJack has the right processes, people and technologies to make its offerings the most effective solutions for tracking and recovering valuable mobile assets. Moreover, the company has the flexibility and opportunistic mindset to pursue additional, emerging markets that expand LoJack's reach into new areas and continue to build its strong brand as the global leader in tracking and recovery products and services.

In November 2006 Richard T. Riley was named Chairman and Chief Operating Officer, following the announced retirement of Joseph F. Abely. In February 2007 Ronald V. Waters joined the company as President and Chief Operating Officer. Ron brings a breadth of experience in consumer product marketing and global market expansion to LoJack. That expertise, combined with his in-depth knowledge of operations and corporate administration, will be invaluable to LoJack as the company continues upon its strong path of focused growth.

While the management team continues to work on the LoJack of tomorrow - with its emphasis on domestic and international growth - the team has an equally strong focus on making the LoJack of today operate in the most efficient and effective manner possible, all the while maintaining the leadership position it has built over the past two decades. As such, LoJack pledges to continue to deliver strong shareholder value and sustained profitable growth.

* 2003 Gallup Survey
** Latest available figures