Profile: LoJack (LOJN.O)

LoJack Corporation (LoJack) is a global provider of technology products and services for the tracking and recovery of stolen mobile assets. The Company’s integration with law enforcement agencies, its technology and wireless network provide a means for the tracking and recovery of stolen vehicles, motorcycles, construction equipment, cargo and people at risk. LoJack products are sold in 27 states and the District of Columbia in the United States, and in 32 countries internationally. LoJack operates through three segments: domestic, international and Boomerang. Under the domestic segment, LoJack develops and markets a variety of products designed to track and recover stolen vehicles, construction equipment, motorcycles, cargo, people at risk and hazardous materials. Through the international segment, its licensed stolen vehicle recovery technology is operational in 32 countries and territories worldwide. Revenue from the Boomerang segment is derived primarily from the sale and installation of Boomerang Espion, Boomerang Espion Alert, Boomerang, Boomerang2 and BoomerangXpress Units, related products and service contracts. In April 2008, it acquired the assets of LSC Locator Systems Corp.

The LoJack Stolen Vehicle Recovery System

The LoJack Stolen Vehicle Recovery System (the LoJack System) is based on radio frequency (RF) technology. In the United States, the LoJack System consists of a Registration System, which the Company maintains and operates; a Sector Activation System (SAS) and Vehicle Tracking Units, collectively the Law Enforcement Components, each operated by law enforcement officials, and a LoJack Unit, which is installed in customer’s vehicles. The LoJack System is designed to be integrated with existing law enforcement computer systems and telecommunication systems and procedures.

The LoJack Unit is a component of the LoJack System that is installed in a purchaser’s vehicle. The LoJack Unit consists of a very high-frequency (VHF) transponder with antenna, microprocessor and power supply, and contains a set of secret codes unique to the Unit. The LoJack Unit’s transmitter is activated upon receipt of its activation code from the SAS. The routine entry of a stolen vehicle report into domestic law enforcement information systems in jurisdictions where the LoJack System is operational causes the SAS to broadcast the activation code to the LoJack Unit in the stolen vehicle, in turn causing the LoJack Unit to transmit a signal. An activated LoJack Unit will continue to broadcast until it receives a properly coded message to stop. The deactivation command is automatically sent to the LoJack Unit upon entry of theft recovery information in the law enforcement information system in jurisdictions where the LoJack System is operational.

LoJack Early Warning, sold as an optional component of the LoJack System, provides early notification to a vehicle or motorcycle owner in the event of operation by an unauthorized user. LoJack Early Warning consists of a coded key pass and a motion sensor that works with the LoJack Unit to monitor vehicle movement and detect the presence of the registered owner’s key pass. Should the vehicle move without the presence of the registered owner’s key pass, a communication from the LoJack Unit in the vehicle is transmitted to the LoJack Control Center, a Company-maintained database that provides automatic notification via e-mail, pager, and/or home, work or cell phone call to the vehicle owner.

LoJack for Construction Equipment is designed specifically for installation on heavy equipment. It functions similarly to the traditional LoJack Unit, but has been modified for use on heavy-duty vehicles. During the year ended December 31, 2008, the Company launched three new LoJack branded products, Locate by LoJack, Proximity Plus by LoJack and ReuniteIT by LoJack. Locate by LoJack is designed for the construction market, provides functions for fleet managers and heavy equipment owners, such as location-on-demand, geofencing, engine hours and user defined reporting allowing equipment owners to analyze their assets. ProximityPlus is a global positioning system monitoring device that enables customers to identify their vehicle’s location and gather information about the driver’s usage of the vehicle from a home or office computer. ReuniteIT is a global registration database that facilitates the identification and return of lost valuables.

The Company offers warranty products that may be purchased to supplement the original purchaser’s warranty. These warranty products include LoJack Extended Limited Recovery Warranty, LoJack Guarantee Plus 5000 (all states but New York) and LoJack Protection Plus 5000 (New York only). In February 2009, the Company re-launched the Locator Systems product and service offerings under the LoJack SafetyNet brand name. LoJack SafetyNet provides technology to law enforcement agencies and Project Lifesaver International (PLI). LoJack SafetyNet search and rescue technology addresses a market need for solutions that track and rescue people at risk. LoJack SafetyNet consists of a Personal Locator Unit (PLU), worn on the wrist of the customer, a Search and Rescue (SAR), Receiver for law enforcement, a database of information about the clients to assist in the search and rescue, and training for law enforcement and public safety agencies to use its technology in the search and rescue process. The PLU constantly emits an RF signal which can be tracked regardless of where the client has wandered. The RF signal enables the police to pinpoint the location of the missing person using a handheld, portable SAR Receiver. It also licenses to SC-Integrity, Inc. (SCI) the use of LoJack trademark for its cargo and tracking recovery product, called LoJack in Transit. LoJack InTransit provides organizations with integrated prevention, detection, investigation and recovery solutions

The Boomerang System

The Boomerang System is based on RF and cellular technology, and uses its internally developed tracking devices and the wireless networks of regional telecommunications companies for locating and tracking stolen assets. The cellular coverage area for Boomerang’s tracking of stolen assets includes most of North America, however its service area is primarily in Canada. The Boomerang Unit is the component of the Boomerang Tracking System that is installed in a purchaser’s vehicle, the cellular network, the Boomerang Security Center and Boomerang Vehicle Tracking Units. If a car equipped with a Boomerang Unit is stolen, the vehicle owner reports the theft to the local police department and the Boomerang Security Center. When the Security Center is advised of a theft and after a police report has been filed, the Security Center locates the approximate location of the Boomerang Unit via a secure connection with the cellular carrier network and then sends a code causing the Boomerang Unit to transmit a tracking signal. A tracking vehicle is dispatched in the general area reported by the Boomerang Unit.

The Vehicle Tracking Units, installed in Boomerang tracking vehicles use direction-finding technology to locate the source of the tracking signal emitted from the Boomerang Unit. Upon location of the stolen vehicle, Boomerang Vehicle Tracking personnel notify local law enforcement, who recover the vehicle. The BoomerangXpress is similar in design and functionality to the Boomerang Unit, but the Boomerang Unit is installed in high-end luxury vehicles, while the BoomerangXpress Unit is targeted to the mid-price vehicle market.

The Boomerang2 and Boomerang Espion Alert Units are products that build upon the Boomerang Unit by integrating two-way communication and diagnostics to provide automatic theft notification by sending a tracking signal upon any unauthorized vehicle movements. A key fob, used in connection with both Units, contains a coded key pass and a motion sensor, which monitors vehicle movement and detects the presence of the registered owner’s key pass. The Boomerang 2 and Boomerang Espion Alert Units also monitor any tampering with the car battery. Should the motion sensor detect that the vehicle is moving without the presence of the registered owner’s key pass, an automatic call is made by the Unit to the Boomerang Security Center indicating an alarm on the customer car. The Security Center then contacts the client to verify the status of the vehicle. If it is determined the vehicle has been stolen, the Security Center proceeds with the same tracking and recovery steps as noted for the traditional Boomerang Unit.

The Water Resistant Boomerang Unit is designed for installation on construction equipment and marine craft. It functions similarly to the traditional Boomerang Unit, but is enclosed in a water-resistant housing. The Portable Boomerang Unit is designed for installation in special applications, such as cargo. It functions similarly to the traditional Boomerang Unit, but is equipped with a longer lasting battery, enabling its operation without a connection to an independent power source.