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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark one)

for the fiscal year ended December 31, 2003.

or

for the transition period from                  to                 .

Commission File No. 1-8439

LOJACK CORPORATION

(Exact name of registrant as specified in its charter)

(781) 251-4700

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $.01 par value

Preferred Share Purchase Rights

(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendments to this Form 10-K. x

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes ¨ No x

The aggregate market value of the registrant’s common stock, $.01 par value (the “Common Stock”) held by non-affiliates was approximately $71,477,000 as of June 30, 2003. The aggregate market value of Common Stock indicated is based upon the last traded price of the Common Stock as reported by NASDAQ on June 30, 2003.

As of March 22, 2004, there were issued and outstanding 15,103,532 shares of the registrant’s Common Stock, $.01 par value.

DOCUMENTS INCORPORATED BY REFERENCE

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LOJACK CORPORATION

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In as much as the calculation of shares of the registrant’s voting stock held by non-affiliates requires a calculation of the number of shares held by affiliates, such figure, as shown on the cover page hereof, represents the registrant’s best good faith estimate for purposes of this Annual Report on Form 10-K. All outstanding shares beneficially owned by executive officers and directors of the registrant or by any shareholder beneficially owning more than 10% of registrant’s Common Stock, as disclosed herein, were considered for purposes of this disclosure to be held by affiliates.

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PART I

ITEM 1 - BUSINESS

GENERAL

LoJack Corporation (“LoJack” or the “Company”) was organized as a Massachusetts corporation in 1978. LoJack is a worldwide marketer of wireless security and location products and services.

The Company develops and markets the LoJack^® Stolen Vehicle Recovery System (“LoJack System”), a unique, proprietary system designed to assist law enforcement personnel in locating, tracking and recovering stolen vehicles. In 2002, the Company introduced the LoJack Early Warning^™ Recovery System (“LoJack Early Warning”), a product building on the Company’s stolen vehicle recovery technology that provides early notification to a vehicle owner in the event an unauthorized user is operating the vehicle. In addition, LoJack develops and markets a product line of its proprietary LoJack System designated for use in international markets where it may not be practicable or desirable to implement the fully integrated LoJack System.

The LoJack System is comprised of a Registration System, maintained and operated by LoJack; a Sector Activation System (“SAS”) and Vehicle Tracking Units, formerly known as a Police Tracking Computer or PTC, operated by law enforcement officials (the “Law Enforcement Components”); and a Vehicle Location Unit (formerly known as the LoJack Unit). The LoJack System is designed to be integrated into existing law enforcement computer systems and telecommunication systems and procedures. If a car equipped with a Vehicle Location Unit is stolen, its owner should report the theft as usual to the local police department. If the theft involves a vehicle equipped with a Vehicle Location Unit and is reported in a jurisdiction where the LoJack System is operational, a unique radio signal will be transmitted automatically to the Vehicle Location Unit in the stolen vehicle, activating its tracking signal. The Vehicle Tracking Unit, installed in police patrol cars and aircraft throughout the coverage areas and used to lead law enforcement officers to the stolen vehicle, uses sophisticated direction-finding technology to locate the source of the tracking signal emitted from the Vehicle Location Unit.

The Company’s revenues in the United States are derived primarily from the sale of Vehicle Location Units, LoJack Early Warning, alarms and related products, and extended warranties on its products, to consumers. Approximately 91% of domestic sales are made through a distribution network consisting of dealers of new and used automobiles. The Company has built strong consumer brand awareness in the United States.

The Company’s licensed stolen vehicle recovery technology and rights are operational in 25 countries and territories around the world. Revenues are derived from product sales, royalties and license fees pursuant to these agreements. Revenues from the international segment comprised approximately 20% of the Company’s consolidated revenues for the year ended December 31, 2003. The Company’s stolen vehicle recovery technology also has the flexibility to operate with private security agencies, independent of existing law enforcement communication networks.

The Company’s strategy is to use existing internal resources and partnerships to drive more aggressive business growth through its automotive channel domestically, and internationally through the Company’s licensees and their strategic relationships with insurance companies and automobile manufacturers. Domestically, the Company uses varied distribution and installation programs to more cost effectively sell and install LoJack Systems. Internationally, the Company intends to drive unit sales growth through existing licensees by helping to develop their business models, developing a global technology roadmap and expanding system infrastructure. The Company from time to time may make direct strategic investments in international licensees, some of which may be substantial.

The Company intends to expand the use of its technology to those domestic and international markets where the combination of new vehicle sales, population density and incidence of vehicle theft is high. Additionally, the Company plans to develop and introduce new products that leverage its brand recognition and reputation for vehicle recovery. LoJack is currently working with two unrelated parties to develop a “next generation” of the Vehicle Location Unit, to replace the current version. The status and expectation of these designs are discussed more fully under the heading “New Product Developments”.

OPERATION OF THE LOJACK SYSTEM IN THE UNITED STATES

Beginning in 1985, under agreements with state agencies, LoJack generally furnishes the Law Enforcement Components for distribution to state, county and municipal law enforcement agencies for a nominal rent or at no cost. The installation, testing and maintenance of the Law Enforcement Components are primarily the responsibility of LoJack. LoJack generally owns the Law Enforcement Components. The LoJack System is designed to integrate with law enforcement systems. The local law enforcement agency operates the Law Enforcement Components as required during the term of each state, county or municipality’s agreement with LoJack. The agreements with the applicable law enforcement agencies generally are for initial terms of up to five years. To date, substantially all such agreements that have expired have been renewed or are in the process of renewal.

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Renewal or extension of any such agreement may be subject to competitive bidding. The Company has no legal obligation to retail customers to provide ongoing systems support and maintenance or to refund any of the purchase price if these agreements expire and are not renewed, or are terminated either by LoJack or by the local law enforcement agencies.

The LoJack System has been implemented in all or a portion of each of the following domestic jurisdictions pursuant to agreements with applicable law enforcement agencies as follows:

Statewide coverage* (over 80% of the population) is available in the following states:

Arizona

California

Connecticut

District of Columbia

Maryland

Massachusetts

Michigan

New Jersey

Rhode Island

Major metropolitan areas, cities and high crime area coverage* is available in the following states:

Colorado

Delaware

Florida

Georgia

Illinois

Louisiana

Nevada

New Hampshire

New York

Pennsylvania

Texas

Virginia

Washington

Coverage in the State of North Carolina is in process and the Company expects it will be completed by the end of the second quarter of 2004.

THE LOJACK SYSTEM

The LoJack System consists of these components:

The Vehicle Location Unit. The Vehicle Location Unit is the component of the LoJack System that is installed in a purchaser’s vehicle. The Vehicle Location Unit consists of a very high frequency (“VHF”) transponder with antenna, microprocessor and power supply. The Vehicle Location Unit contains a set of codes unique to the unit. The Vehicle Location Unit’s transmitter will be activated upon receipt of its unique activation code from the Sector Activation System. The routine entry of a stolen vehicle report into law enforcement information systems causes the Sector Activation System to broadcast the unique activation code to the Vehicle Location Unit in the stolen vehicle, in turn causing the Vehicle Location Unit to begin to transmit. An activated Vehicle Location Unit will continue to broadcast until it receives a properly coded message to stop. The deactivation command message is sent automatically to the Vehicle Location Unit upon entry of information in the police computer system that the police have recovered the vehicle. All transmissions are made on a

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nationwide radio frequency allocated by the Federal Communications Commission (“FCC”) as a law enforcement radio service.

Vehicle Tracking Unit. The Vehicle Tracking Unit is a sophisticated radio direction finder used by police to locate and track activated Vehicle Location Units. The Vehicle Tracking Unit consists of a radio receiver with a directional antenna array, Doppler signal processor, microprocessor-based computer and a controllable display. When the Vehicle Tracking Unit detects a Vehicle Location Unit transmission from a stolen vehicle, it displays the identity of the unit along with graphic indications of signal strength and the direction toward the stolen vehicle. An officer then enters the reply code into his mobile data terminal or radios the reply code to the police dispatcher and obtains a vehicle description.

The Vehicle Tracking Unit is generally installed in police vehicles. Modified designs of the Vehicle Tracking Unit are used in helicopters, airplanes and fixed locations such as toll booths, radio towers or police communication centers. Effective tracking range varies under different topographical and other conditions, from about one mile to approximately five miles under ideal conditions.

Sector Activation System. The Sector Activation System consists of a Sector Activation Computer (“SAC”), Sector Activation Transmitters and the communication network that connects them.

For each vehicle equipped with a Vehicle Location Unit, the SAC contains the vehicle identification number (“VIN”) assigned by the vehicle’s manufacturer, and the activation, deactivation and reply codes for the Vehicle Location Unit installed in that vehicle. The SAC also controls the Sector Activation Transmitter network, causing activation, speed-up and deactivation commands to be broadcast at appropriate times during the stolen vehicle activation and recovery sequence.

The Sector Activation System is integrated with existing law enforcement computer and telecommunication systems and procedures. Routine and normal processing of a stolen vehicle report activates the Sector Activation System, even if the person reporting the theft and the officer responding are unfamiliar with the LoJack System.

Registration System. The Registration System is a proprietary method of assigning digital codes to be transmitted and received by Vehicle Location Units in such a manner that unique activation codes are permanently correlated with the unique VIN assigned to the vehicle in which the Vehicle Location Unit has been installed.

LOJACK EARLY WARNING

LoJack Early Warning, sold as an optional component to the LoJack System, provides early notification to a vehicle owner in the event an unauthorized user is operating the vehicle. LoJack Early Warning consists of a uniquely coded key pass and a motion sensor that works with the Vehicle Location Unit. The motion sensor monitors vehicle movement and detects the presence of the registered owner’s key pass. Should the motion sensor detect that the vehicle is moving without the presence of the registered owner’s key pass, a communication from the Vehicle Location Unit in the vehicle is transmitted back 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.

NEW PRODUCT DEVELOPMENT

Next Generation of the Vehicle Location Unit. LoJack is currently working with two unrelated parties to develop the “next generation” of the Vehicle Location Unit to replace the current version. The designs are expected to decrease manufacturing and installation costs and reduce the size of the Vehicle Location Unit, enabling installation in more covert locations in the consumer’s vehicle than at present . In addition, the “next generation” Vehicle Location Units are intended to be scalable and flexible, with connectivity features that will allow the Company to develop new products combining Global Positioning System (“GPS”) and/or cellular based communications with LoJack’s time tested Radio Frequency (“RF”) based stolen vehicle recovery technology. LoJack expects that an important feature of the new designs will be a common platform for both domestic and international operations which utilizes the same basic unit to operate on the varying radio frequencies used in the many countries where LoJack technology is utilized for stolen vehicle recovery. The Company believes this common platform also will result in manufacturing and distribution efficiencies and facilitate global cross border tracking and recovery. The Company expects to begin selling the new designs in 2005.

MARKETING AND DISTRIBUTION OF VEHICLE LOCATION UNITS - UNITED STATES

LoJack’s marketing approach focuses on the U.S. automotive channel, where car dealerships offer the LoJack System as an option on both their new and used car sales. LoJack also markets LoJack Early Warning, conventional vehicle security

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devices and extended warranties through independent car dealers. The Company markets primarily through a national sales force that routinely visits new and used car dealers to educate and train dealership personnel on the benefits of the LoJack System and related products. In addition, to supplement its distribution efforts, the Company has entered into cooperative arrangements with third parties specializing in after-market sales and installation of vehicle accessories to increase penetration in existing markets in a cost effective manner. The Vehicle Location Unit and related products usually can be financed conveniently as a part of the purchase price of the vehicle. LoJack also uses direct advertising to consumers to generate product awareness.

LoJack also markets its products directly to owners of commercial vehicles and to consumers. The Company may look to expand to other markets in the future, focusing on opportunities that fit the strategic plans of the Company relating to the recovery of stolen assets and other location based products and services.

In 2002, the Company began to contract with certified dealers and other third parties to install the Vehicle Location Unit. The Company plans to continue to expand this practice in 2004. LoJack monitors the quality of these alternative installations through the use of an expanded quality control process. For all installations, whether performed by LoJack or a third party, the Company maintains full warranty service of Vehicle Location Units, both for the convenience of dealers through which the Vehicle Location Units are marketed and for LoJack to maintain a high degree of quality control and security over its technology. LoJack also offers an extended warranty at the point of sale to new customers and through direct sales efforts to existing owners.

INTERNATIONAL OPERATIONS

LoJack began international operations in 1993 and its licensed technology is operational in 25 countries and territories. LoJack has established an international strategy that includes prioritization of markets, product and technology roadmaps, global branding and investment in certain key markets of interest. LoJack has developed its technology such that the LoJack System can be used either by law enforcement, by the licensee’s own security organizations, or by a combination of both. LoJack has established the Global Technology Advisory Council including members from its licensees, which is responsible for the definition and development of new products for the international market.

License agreements with international parties have thus far been denominated in U.S. dollars and are structured with up-front licensing fees, which may be substantial and are non-recurring. The agreements provide that the Company will subsequently either supply components and products at prices to be determined from time to time and/or receive royalties based upon the licensees’ revenues. The Company leverages its close relationships with its international licensees to enhance its understanding of their business models and to develop a global technology roadmap.

The Company focuses primarily on the top 30 global markets. Markets are ranked based on high per capita thefts, high annual recurring sales of new vehicles and large numbers of vehicles operating in the area. International dealings in the future may be in the form of continuing to license the use of the LoJack stolen vehicle recovery system technology in other selected international markets on the same basis as described above, or it may be in the form of strategic investments. LoJack’s investment strategy has focused on those markets which either represent the best opportunities for significant generation of revenue or where the Company can positively impact time to market or revenue growth.

In December 2002, the Company established a wholly owned Brazilian subsidiary, LoJack do Brasil. In May 2003, this subsidiary began purchasing product from the Company’s supplier and selling to the Company’s Brazilian licensee. The Company formed LoJack International Benelux, a 48.4% owned Belgian subsidiary, and LoJack Italia Srl., a wholly owned Italian subsidiary, in January 2003 and January 2004, respectively. There are no current operations in Belgium or Italy.

LoJack has also made direct investments in selected international licensees that the Company believes offer significant market opportunity for Vehicle Location Unit sales. At December 31, 2003, the Company held a 13.37% equity investment, with a carrying value of $2,454,000, in its French licensee and a 12.5% equity investment, with a carrying value of $1,502,000, in its Mexican licensee. At December 31, 2003, the Company held a loan receivable from its Argentine licensee of approximately $1,339,000 resulting from the 2002 conversion of the licensee’s existing accounts receivable into a long term financing agreement. This loan is secured by a pledge of all of the stock of the Argentine licensee as well as a personal guarantee by the licensee’s principal, and a reserve for 100% of this loan has been established due to the uncertainty of collection. As additional consideration for the loan, the Company received 10% of the Common Stock of the Argentine licensee and agreed to return half of this stock to the licensee upon repayment of the loan at maturity.

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The Company’s licensed stolen vehicle recovery technology and rights are operational in 25 countries and territories around the world including: Argentina, Brazil, Colombia, Costa Rica, Ecuador, France, Germany, Guatemala, Hong Kong, Kenya, Lesotho, Mexico, Mozambique, Nigeria, Panama, Poland, Puerto Rico, Russia, South Africa, Spain, Swaziland, Trinidad and Tobago, Uganda, United Kingdom, and Venezuela. The Company also is pursuing similar agreements for licensing its technology in other countries.

Approximately 20% of the Company’s consolidated revenues for the year ended December 31, 2003 were derived from sales to and license fees from international licensees, up from 17% a year ago. These revenues were comprised of product and component sales and licensing and royalty revenues. The terms under which the Company generally sells products and components of the LoJack System to international licensees include cash prepayments, letters of credit, purchased export insurance, or most commonly, established payment terms. The Company recognizes revenue upon shipment of the product or when payment becomes reasonably assured, whichever is later, and recognizes license payments in revenue over the term of the license (generally ten years). Royalty revenues are recognized when earned or when payment becomes reasonably assured, whichever is later.

The Company has identified the following inherent risks attendant to the Company’s international operations:

(See notes 1, 3, 9 and 10 in the notes to the consolidated financial statements included herein at Item 8 for further information regarding international operations.)

GOVERNMENT REGULATION AND APPROVAL

The FCC allocated frequency 173.075 MHz, used by the LoJack System in the United States, for nationwide use by state and local law enforcement agencies for stolen vehicle recovery systems. Law enforcement agencies in jurisdictions where the Company operates have been granted authority by the FCC to use this frequency for a stolen vehicle recovery system.

In connection with its domestic operations, the Company must obtain the approval of law enforcement agencies for implementation of the LoJack System before sales of Vehicle Location Units can commence in a given jurisdiction. The approval process may be time consuming and costly and is subject to considerations generally affecting the process of governmental decision-making. In some jurisdictions, governmental approval may be terminable at the convenience of the executive or legislative body. Any such termination could have a material adverse effect on future sales in such jurisdictions.

The Company’s international licensees are subject to similar risks.

If LoJack were to seek to charge more than nominal prices for the Law Enforcement Components, governmental appropriation of funds would be required. Most government agencies have established, by policy, statute or regulation, a process requiring competitive bidding for all acquisitions of products and equipment. This process may cause delay and expense to the Company. To date, the Company has not sought to charge law enforcement agencies more than nominal prices for the Law Enforcement Components, and does not expect to do so in the near future.

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AUTOMOBILE INSURANCE BENEFITS

Management considers automobile insurance premium discounts to be an inducement for the purchase of Vehicle Location Units by vehicle owners in the United States. Insurance premium discounts, which are generally applied to the vehicle owner’s comprehensive insurance, vary from state to state and, in some cases, from insurance company to insurance company. Currently, insurance companies provide for discounts of up to 35% on comprehensive insurance premiums for vehicles equipped with a vehicle recovery and anti-theft device.

Several of the Company’s international licensees have arrangements and strategic relationships with insurance companies that management believes drive demand for the Company’s products outside the United States.

PRODUCT WARRANTY

LoJack Product Warranties. LoJack warrants to original purchasers of Vehicle Location Units that the LoJack System and LoJack Early Warning will be free from defects in material or workmanship for a period of two years from the date of installation. If the product proves to be defective in material or workmanship, the Company will, at its option, either replace the product or provide, without charge, the labor and parts necessary to remedy any such defects at a LoJack operated installation center.

Limited Recovery Warranty. LoJack also warrants to original purchasers of Vehicle Location Units that if their LoJack equipped vehicle is stolen and reported in a covered jurisdiction within two years of installation and not recovered within 24 hours from the time that the theft is reported to the police, LoJack will pay the consumer an amount equal to the full purchase price of the Vehicle Location Unit up to a maximum of $695 (up to $995 if the consumer also purchased LoJack Early Warning). For an additional charge, the original purchaser of the vehicle can elect to extend the warranty period from two years to a period equal to the time they own the LoJack equipped vehicle.

LoJack Guarantee Plus 5000. Consumers may purchase an additional five year warranty in which LoJack, or in most jurisdictions an independent third party insurer, warrants to original purchasers of Vehicle Location Units that if the vehicle becomes a total loss due to theft or is not recovered within 30 days from the time the theft is reported to the police, the consumer could receive up to $2,500 to cover theft related expenses plus up to an additional $2,500 towards the purchase or lease of a replacement vehicle if the consumer returns to the original dealer. The Company has insured the risk relating to these warranty claims.

PATENTS AND TRADEMARKS

LoJack holds a patent portfolio that covers vehicle tracking, security and recovery. The portfolio includes United States Patent Nos. 4,818,998, 4,908,629, 5,917,423 and 6,229,988BI, which expire in 2006, 2007, 2015 and 2018, respectively, covering the LoJack System. Each of these patents builds on the predecessor patents by adding additional functionality that the Company believes yields a competitive advantage. In addition, the Company holds proprietary information that is not patented, but is integral to the operation of the LoJack System. The Company believes that protection of that intellectual property continues beyond the expiration of the stated patents.

LoJack also holds United States Patent No. 6,522,698 covering LoJack Early Warning which expires in 2020.

The Company also holds similar patents in various countries where it either currently does business or intends to do business.

Although management believes the patents have value, there can be no assurance such patents will effectively deter others from manufacturing and marketing a stolen vehicle recovery system.

LoJack’s name and logo are registered trademarks in the United States and many other countries. The Company believes the LoJack trademark and other trademarks have sufficient recognition to confer a competitive advantage upon the Company.

COMPETITION

Several competitors or potential competitors are marketing or have announced the development of products, including those that are based on GPS technology, which claim to have stolen vehicle tracking features that may compete directly with the LoJack System. To the knowledge of management, none of these products is directly integrated with law enforcement systems or operated and monitored exclusively by law enforcement agencies, as is the LoJack System.

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LoJack markets the LoJack System as a stolen vehicle recovery device. Management believes, however, that makers of auto theft prevention devices view the LoJack System as competitive, and, consequently, LoJack believes it faces competition from companies that sell vehicle security devices. Some of the competitors and potential entrants into the vehicle tracking industry have greater resources than LoJack. In addition, there can be no assurance that a competitor will not develop a system of theft detection or recovery, including other stolen vehicle recovery systems that may not require government approvals, which would compete with or be superior to the LoJack System.

The Company believes that it faces competition from companies selling vehicle alarms, GPS products and third party warranty and insurance products; not because the products are comparable to the products offered by LoJack, but because they are competing for available consumer funds in the automobile security products after-market. Known providers of alarms include Directed Electronics Incorporated and Audiovox while known providers of GPS products include OnStar^® and Mobile Guardian. There are numerous smaller companies selling extended warranties and other insurance based products.

Although other products may have a lower cost and may result in higher gross margins to the automotive dealer that resells the product, LoJack believes it is competitive based on its proven technology, law enforcement relationship, proven effectiveness resulting in a 90% recovery rate, superior brand name recognition and its 24-hour recovery guarantee.

CONTRACT MANUFACTURING ARRANGEMENTS

LoJack has contract manufacturing arrangements for the current and anticipated new versions of the Vehicle Location Unit and other LoJack System components. The Company has utilized Motorola, Inc. for over 15 years to manufacture the Vehicle Location Unit. LoJack believes that several companies have the capability to manufacture Vehicle Location Units. The Company has also contracted with Motorola for the development and design of a “next generation” Vehicle Location Unit.

The Company believes it can now purchase Vehicle Location Units in sufficient volumes to support two suppliers. In December 2003, the Company entered into an agreement with Plextek Limited, communications technology consultants, to design and supply, through a third party contract manufacturer, a “next generation” Vehicle Location Unit. LoJack believes this will reduce the risks associated with having only a single supplier and expects that it will result in more competitive pricing from both suppliers. Future expected attainment of agreed upon milestones by both Motorola and Plextek could result in expenses of approximately $2,500,000 within the next twelve to eighteen months. The Company does not expect either “next generation” product to have a material impact on revenues or gross margins in 2004.

INVENTORY

LoJack seeks to maintain a 90-day domestic supply of Vehicle Location Units, which it believes is in line with sales levels and sufficient to rapidly fulfill orders. The Company fills orders as they are received and maintains no domestic order backlog. The Company also maintains inventory in LoJack do Brasil, as a result of the commencement of production by Motorola Brazil, to supply the Company’s Brazilian licensee.

The Company maintains an inventory of certain Law Enforcement Components beyond its current requirements in order to facilitate expansion into additional domestic and international markets.

PRODUCT DEVELOPMENT

Costs for product development are expensed as incurred and include salaries, fees to consultants, and other related costs associated with the development of new products. Total product development expenses totaled $3,534,000, $2,300,000 and $2,634,000 for the years ended December 31, 2003 and 2002 and the ten months ended December 31, 2001, respectively. A portion of the Company’s product development efforts has been outsourced to third parties. The contracts with third parties require payments based upon completion of defined milestones. Expenses related to milestone achievements, included in the above mentioned expenses, amounted to $540,000, $85,000 and $1,071,000 for the years ended December 31, 2003 and 2002 and the ten months ended December 31, 2001, respectively.

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EMPLOYEES

As of December 31, 2003, the Company had a total of 685 full-time employees, 283 of whom are field installation personnel and 113 of whom are part of the field sales organization.

SEGMENT INFORMATION

The Company divides its operations into a domestic segment and an international segment. For financial information about our segments, and by geographic area, see notes 1, 9 and 10 to the Company’s consolidated financial statements contained herein at Item 8.

EXECUTIVE OFFICERS OF THE REGISTRANT

Information concerning the Company’s executive officers is set forth below.

Mr. Rossi joined LoJack in November 2000 as Chief Executive Officer. He became a Director and was elected Chairman of the Board of Directors effective May 21, 2001. Prior to joining LoJack, Mr. Rossi spent 35 years with the Gillette Company, progressing through a variety of management positions in sales, marketing, and general management in the United States, Canada and Puerto Rico. Mr. Rossi served as President of Oral-B Worldwide, a Gillette Company, from 1998 to 2000. From 1988 to 1998 he was President of Gillette North America; previous positions include President of Gillette Canada and President of Braun/Canada. Mr. Rossi has also been a member of the board of the Mentor Corporation since January 2000 and had served on the executive board of the Massachusetts Bay Red Cross from 1993 through 1998, the board of the New England Sports Museum from 1993 through 1998, and as chairman of the Canadian Cosmetic and Toiletry Fragrance Association in 1987.

Mr. Abely joined LoJack in October 1988 as Senior Vice President and Chief Financial Officer. He was named President and Chief Operating Officer in January 1996 and a Director in November 2000. From 1976 until October 1988, Mr. Abely was employed by the accounting firm of Deloitte, Haskins & Sells, where he served as a partner from 1985. Mr. Abely is a Certified Public Accountant.

Mr. Duvall joined LoJack in 1985 and is Executive Vice President. From 1993 to 2003, he was Senior Vice President. He was appointed President of LoJack International in 2001. From 1984 to 1985, he was a part owner and manager of Rich’s Car Tunes, a company engaged in the sale and installation of consumer electronic products in the automotive aftermarket. For six years prior to 1984, Mr. Duvall was Vice President of Marketing and Sales for Analog and Digital Systems, Inc., a manufacturer of consumer electronic products.

Mr. Wooters joined LoJack in December 2003 as Executive Vice President and General Counsel. He has over 35 years of legal experience representing public and private companies and investors in such companies in a range of businesses, including more than 25 years as outside counsel to LoJack. Mr. Wooters practiced law with the law firm of Sullivan &

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Worcester LLP for the past 4 years, most recently as “of counsel.” Mr. Wooters is a Director of Storage Computer Corporation, a manufacturer of high performance fault tolerant storage subsystems, and of other private technology companies.

Mr. Farris joined LoJack in October 2000 as Vice President of Finance and Chief Financial Officer. From 1996 to 2000, Mr. Farris served as Vice President of Finance and Chief Financial Officer of Arkwright, Inc., a manufacturer of digital imaging supplies. From 1981 to 1996, Mr. Farris held various financial management positions at Digital Equipment Corporation. Mr. Farris is a Certified Public Accountant.

Mr. Conner joined LoJack in 1985 and is Vice President of Government Relations. From 1982 to 1985, he was a franchise director for Continental Cablevision of Boston, Massachusetts. From 1980 to 1982, Mr. Conner was a franchise director for American Television Communications of Denver, Colorado, a cable television operator.

Ms. Driscoll joined LoJack in May 2001 and is Vice President of Marketing. From 1999-2000, she was Chief Marketing Officer for Roxy.com, an on-line retailer of consumer electronics. From 1987 until joining LoJack, Ms. Driscoll served in a variety of executive positions at various companies including Citigroup from 1997-1999; AT&T Capital Corp from 1994-1997; Fidelity Investments from 1992-1994; and Citigroup Point of Sale Information Services Inc. from 1987-1992.

Mr. Mullins joined LoJack in February 1996 and is Vice President of Sales. Mr. Mullins served as Vice President of Sales and Marketing of LoJack from February 1996 until May 2001. From 1976 until joining LoJack, Mr. Mullins served in a variety of positions at Proctor & Gamble Company, Inc., including District Sales Manager, Customer Business Development Manager, and most recently as Northeast Operation Manager.

There are no arrangements or understandings pursuant to which any executive officer was or is to be selected for election or reelection. There are no family relationships among any Directors or executive officers.

ITEM 2 – PROPERTIES

The Company’s executive offices are located at 200 Lowder Brook Drive, Suite 1000, Westwood, Massachusetts, under a lease for such space expiring in January 2007. LoJack maintains a facility located in Canton, Massachusetts for its engineering operations under a lease that expires in September 2007; and maintains facilities in Palmdale, California and Westwood, Massachusetts for its Call Center operations under leases that expire in February 2007 and June 2008, respectively. In addition, the Company leases facilities for its Sales and Operations personnel in Arizona, California, Florida, Georgia and New Jersey under operating leases that expire from 2004 to 2009. The Company does not maintain properties in foreign countries relating to its operations. Because the Company’s operations do not require any special facilities, the Company does not anticipate any difficulty in finding space adequate for its purposes at reasonable rates, should the need arise. The Company believes that its facilities are adequate for its operations.

ITEM 3 – LEGAL PROCEEDINGS

The Company was not a party to any material legal proceedings during the fiscal year ended December 31, 2003, and the Company is not currently a party to any material legal proceedings.

ITEM 4 – SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

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PART II

ITEM 5 – MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

LoJack’s Common Stock is traded on the NASDAQ National Market under the symbol: LOJN.

The following table sets forth the range of the high and low bid information for the Common Stock of LoJack for the periods indicated, as reported by NASDAQ. This information reflects inter-dealer prices, without retail mark-up, markdown or commission and may not necessarily reflect actual transactions.

On March 22, 2004, there were 2,418 record holders of the Company’s Common Stock. The Company believes the actual number of beneficial owners of the Common Stock is approximately 8,387 because a large number of the shares of the Company’s Common Stock are held in custodial or nominee accounts for the benefit of persons other than the record holders.

LoJack has never paid a dividend, and at the present time the Company expects that future earnings will be retained for use in its business. The Company’s line-of-credit facility with a bank permits the payment of dividends so long as such payment does not cause noncompliance with certain loan covenants. Although there is no present intent to pay dividends, the Company does not believe these restrictions are likely to materially limit the payment of dividends should the Company decide to do so in the future.

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ITEM 6 - SELECTED FINANCIAL DATA

The following table sets forth selected consolidated financial data of LoJack for the periods indicated. On October 24, 2001, the Company changed the date of its fiscal year end from the last day of February to December 31, effective December 31, 2001. The selected consolidated financial data for and as of the years ended December 31, 2003 and 2002, the ten months ended December 31, 2001 and for the years ended February 2001 and 2000 are derived from the consolidated financial statements of the Company. Certain reclassifications have been made to prior years’ data relating to the statements of income to conform to current year presentation. The amounts for the year ended February 28, 2001, include the cumulative effect on prior years of a change in accounting principal for revenue recognition on international license fees in accordance with SEC Staff Accounting Bulletin No. 101 “Revenue Recognition in Financial Statements.” The information set forth below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” at Item 7 and the consolidated financial statements and notes thereto at Item 8.