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Revenue BuilderPre-Install Program

11/04/2014

• To share how other dealers are partnering with LoJack to drive significant PVR gains

• To discuss how the same can be done for your

business

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Today’s Objectives

• Dramatically reduced dealer pricing for pre-equipping vehicles with the LoJack® Stolen Vehicle Recovery System

• Significant financial investment in program by LoJack • Major deployment of resources by LoJack• Implementation of proven Best Practices from successful

partners• Marked improvement in dealership PVR

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Elements of LoJack Pre-Install Program

Notes:•“On PIP” based on total program average performance. Assumed car sales of 150 vehicles per month & ongoing price of $160.•Includes LoJack and ancillary product (XLW) sales

Profit Metrics: Before and After Pre-Install

LoJack Pricing:

Upgrade Products Pricing:

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Pre-Install Pricing

Product Standard 1x1 Dealer Pre-Install Dealer

LoJack® Stolen Vehicle Recovery System (Installed)

$345 $159

Product Standard 1x1 Dealer Pre-Install Dealer

Extended Limited Warranty (XLW)

$50 $50

Protection Plus 5000 (ES5000) $108 $108

Profit Scenarios – 100 Cars Sold/Month

Notes:•Above profit scenarios assume car sales of 100 vehicles per month, discounted retail price of $695, ongoing LoJack price of $159.•Includes LoJack and ancillary product (XLW &ES5000) sales

CompositeSell-Through Percentage: 40% 50% 62% 70% 80%

Monthly LoJack Sales 40 50 62 70 80LoJack Revenue $27,800 $34,750 $43,090 $48,650 $55,600

Total LoJack Product Cost $15,900 $15,900 $15,900 $15,900 $15,900Total Monthly LoJack Dealer Profit $11,900 $18,850 $27,190 $32,750 $39,700

Upgrades Revenue $7,200 $9,000 $11,160 $12,600 $14,400Upgrades Cost $3,552 $4,440 $5,506 $6,216 $7,104Upgrades Monthly Profit $3,648 $4,560 $5,654 $6,384 $7,296

PVR $155 $234 $328 $391 $470

Annual Dealer Profit:Total Profit with XLW Upgrade $186,576 $280,920 $394,133 $469,608 $563,952

Monthly Vehicle Sales 100 Upgrade Attachment Rate 60.0%LoJack Avg. Selling Price $695 Upgrades - Selling Price $300LoJack Product Cost (installed) $159 Upgrades - Cost $148

LoJack PIP Program - Dealer Profit Scenarios

Key Assumptions

Profit Scenarios – 150 Cars Sold/Month

Notes:•Above profit scenarios assume car sales of 150 vehicles per month, discounted retail price of $695, ongoing LoJack price of $159.•Includes LoJack and ancillary product (XLW &ES5000) sales

CompositeSell-Through Percentage: 40% 50% 62% 70% 80%

Monthly LoJack Sales 60 75 93 105 120LoJack Revenue $41,700 $52,125 $64,635 $72,975 $83,400

Total LoJack Product Cost $23,850 $23,850 $23,850 $23,850 $23,850Total Monthly LoJack Dealer Profit $17,850 $28,275 $40,785 $49,125 $59,550

Upgrades Revenue $10,800 $13,500 $16,740 $18,900 $21,600Upgrades Cost $5,328 $6,660 $8,258 $9,324 $10,656Upgrades Monthly Profit $5,472 $6,840 $8,482 $9,576 $10,944

PVR $155 $234 $328 $391 $470

Annual Dealer Profit:Total Profit with XLW Upgrade $279,864 $421,380 $591,199 $704,412 $845,928

Monthly Vehicle Sales 150 Upgrade Attachment Rate 60.0%LoJack Avg. Selling Price $695 Upgrades - Selling Price $300LoJack Product Cost (installed) $159 Upgrades - Cost $148

LoJack PIP Program - Dealer Profit Scenarios

Key Assumptions

LoJack is committed to your success with:

•For first 30 days of Program, LoJack will price all LoJack units at $99 (inventory load and incoming vehicles)

•If sell-through rates meet/exceed 50% in months 2 and 3, LoJack will reimburse dealer partner entire cost of initial inventory load (up to 60 days’ supply)

•For the first 90 days of the program, LoJack will price XLW paper upgrade product at $25*

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LoJack Financial Investment in Pre-Install Partners

* Net price is $0 but includes $25 incentive to Finance Manager

Performance Dividend pays back the Dealer Invoice for the initial Lot Load if the dealer reaches 50% sell through of LoJacks in Months 2 & 3 combined. Sell Through is calculated as: number of LoJack units retailed/number of cars sold with LoJack units loaded on them; DMS report required for verification. Paper Upgrade costs shown are net of incentives paid to dealer personnel (if applicable). See Price Change Notice and Revenue Builder 3 promotion terms doc for full terms.

LoJack Pre-Install Revenue Builder ProgramDealer Profitability and Satisfaction is the basis to our long term success. LoJack’s unique Pre-

Install Program includes five steps taken over five months designed to build your sales and revenue.

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Month 1

$99/Unit

Month 2 Month 3

$159/Unit OngoingStep 1: Load

On-Site LoJack Training

Monthly check-ins, reporting to pinpoint opportunities to grow performance

Performance Dividend: 50% pen in months 2 & 3 and LoJack pays back your

initial load

Training, support, coaching as neededStep 2: Learn

Step 3: Sell

Step 4: Grow

Step 5: Payback

Month 4 Month 5

$25 Paper (XLW) $50 XLW Net Cost

LoJack Paper Upgrades Are Key to Driving Program Profit

XLW ES5000 Bundle

MSRP $100 $200 $300

Dealer Net Cost $50 $108 $158

Dealer Gross Profit $ $50 $82 $142

Dealer Gross Profit % 50% 46% 47%

Benefits of Selling Paper Upgrades:

•High margin products for dealer•Higher suggested package retail allows for more dealer discounting/value pricing•Revenue Builder promotion provides XLW paper product at $25 net cost* to the dealer for the first 90 days of the program•Allows dealership personnel to get in the habit of selling paper upgrades from the start of the program•ES5000 product is reinsured. Reserves approximately $60 to $70 per contract.

Dealer Profit Per Unit – Paper Upgrades

Extended Limited Warranty (XLW) Offers five additional years of limited warranty protection and 24 hour recovery or your money back per the two year LoJack Limited Warranty. 24 hour recovery or your money back; limited to the MSRP for the LoJack unit and thefts in LoJack coverage areas.**

Extended Security 5000 (ES5000) Pays a total loss benefit of up to $5,000 if your vehicle is not recovered within 30 days or, after recovery, is deemed a total loss due to theft.**

* Net cost is $0 but includes $25 Finance incentive** Additional terms and conditions apply

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• LoJack brand awareness by customer leads to ease-of-sale• The value of the LoJack product is unquestionable• Fits well with other high-value F&I products• Pre-equipping inventory provides lot protection against theft• Lender advances for LoJack help ensure deals are financed• Incentive monies are available on Upgrade products to drive

additional profit

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Other Features/Benefits of the Pre-Install Program

Proven Process:

• Pricing & program terms

• IT connection established

• In-depth logistics review of installation and operations protocol, delivery schedules and sales process

• Establish initial load date and training schedule

• Kick-off event led by GM

• Initial units installed

• Basic training deployed to sales and F&I

• Initial test data passed to LoJack

• Program performance review

• Dashboard reporting

• Advanced Sales and F&I training

• Premium Customer Support (1-Stop Shop)

• Program enhancements

LoJack’s dedicated field team will guide your dealership from initial set-up to sell-through and will ensure flawless execution of the program.

• Offer of pre-install partner pricing and incentives• 45 day payment terms• In-market program management to provide all necessary

training, coordination of program rollout and sales support materials

• Program oversight / analysis leading to recommendations for enhanced success

• Dedicated on-site technician team geared to prompt / efficient installations

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The Plan: LoJack’s Role

• Agree to terms of the Revenue Builder Program• Establish pay plan and internal functional alignment geared toward

maximum sales penetration– LoJack BDM can provide sample pay plans if desired

• Establish LoJack retail price that encourages high penetration levels• Set up ongoing program reporting for analysis and to monitor success

– If no data exchange process is implemented, dealer agrees to submit paper accept/decline forms to LoJack

• Meet regularly with LoJack to review success of program• Provide Installation coordination

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The Plan: Dealer’s Role

• Program Pricing & Terms to participate in LoJack Pre-Install Program

• Follow-up meeting with management team to review key elements of program

• Logistics meeting with all departments to coordinate launch of program

• Installations can begin within 2 weeks

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Next Steps