PLEDGE AGREEMENT

This PLEDGE AGREEMENT (the “ Pledge Agreement ”), is made as of September 22, 2009, jointly and severally by each of LoJack Corporation, (“ LoJack ”), and the Canadian Borrowers and Foreign Borrowers defined in the Credit Agreement referred to below (collectively with LoJack, the “ Pledgors ” and each sometimes referred to herein as a “ Pledgor ”), in favor of RBS CITIZENS, NATIONAL ASSOCIATION, as Administrative Agent for itself and the other Lenders hereinafter defined   (the “ Agent ”).

WHEREAS , the Pledgors have entered into a Multicurrency Revolving Credit and Term Loan Agreement dated as of July 20, 2007 with the Agent and the other Lenders (the “ Lenders ”) defined therein (as may be further amended, restated or otherwise modified from time to time, the “ Credit Agreement ”), pursuant to which the Lenders have made loans to the Pledgors;

WHEREAS , pursuant to a Waiver Agreement dated as of September 22, 2009 (the “ Waiver Agreement ”), the Pledgors have agreed to provide the Collateral defined herein to provide security for the Obligations;

WHEREAS, capitalized terms used herein and not otherwise defined herein have the meanings given in the Credit Agreement or the Waiver Agreement, as applicable;

WHEREAS , each Pledgor wishes to grant pledges, assignments and security interests in favor of the Agent as herein provided; and

NOW, THEREFORE , in consideration of the premises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.   Pledge of Collateral .   

Each Pledgor hereby pledges, assigns, grants a security interest in, and delivers to the Agent for the benefit of Lenders the following collateral (the “ Collateral ”):

(a)  The $22,500,000 of cash wired by the Borrower to its operating account with the Agent ( the “Operating Account”)on September 21, 2009;

(b)  All right, title and interest of the Pledgors to the cash, cash equivalents and proceeds to be maintained in that certain Deposit Account to be created by the parties as possible after the date of this Agreement, and to thereupon be listed on Schedule A hereto, and into which the Agent will, upon creation of the Account,  move the $22,500,000 of cash collateral referenced in Section 1(a) above (the “ Cash Collateral Account ”),

(c)  all property credited to or on deposit from time to time in the Cash Collateral Account;

(d)  All Cash Collateral and the Cash Collateral Account; and

(e)  all other property at any time assigned or pledged to the Agent hereunder (whether described herein or not),

in each case, together with all substitutions, accessions or additions thereto, together with all proceeds and products thereof, and all distributions, dividends, and income received thereon.

Each of the Pledgors also hereby agrees to add additional cash or cash equivalents to the Cash Collateral Account from time to time to the extent required by the Waiver Agreement, all of which additional amounts shall be Collateral hereunder.

Each of the Pledgors also hereby irrevocably authorizes the Agent at any time and from time to time to file in any filing office in any UCC jurisdiction any initial financing statements and amendments thereto indicating the Collateral.

Cash Collateral .  See §4.

Cash Collateral Account .  See §1(b).

Collateral . See §1.

Operating Account . See §1(a).

4.1.   Cash Collateral Account .   All sums of money that are delivered to the Lender pursuant to this §4 shall be deposited into the Cash Collateral

Account to be maintained with the Agent and to be listed on Schedule A hereto; provided, however, that as provided in Section 1, the initial deposit of the Cash Collateral shall be made into the Operating Account pending creation of the Cash Collateral Account.  The Cash Collateral Account will be an interest bearing deposit account.  The Cash Collateral Account, all sums from time to time standing to the credit of the Cash Collateral Account, including interest thereon, and any and all proceeds of any thereof are hereinafter referred to as the “ Cash Collateral ”.  Agent has and will have “control” within the meaning of Section 9-104 of the UCC of the Operating Account until such time as the Collateral is transferred to the Cash Collateral Account, and thereafter of the Cash Collateral Account.

4.2.   Withdrawals from Cash Collateral Account .   Except as otherwise expressly provided in §14 upon termination of this Pledge Agreement, until such time as the Cash Collateral is  transferred to the Cash Collateral Account, the Pledgor shall have no right to withdraw (x) the Collateral from the Operating Account and (y) the Pledgors shall have no right to withdraw sums from the Cash Collateral Account, to receive any of the Cash Collateral or to require the Agent to part with the Agent's possession of any instruments or other writings evidencing any deposits within the Cash Collateral Account..

5.   Warranty of Title; Authority .   Each Pledgor hereby represents and warrants that:

(a)  such Pledgor has good and marketable title to the Collateral described in §1, subject to no pledges, liens, security interests, charges, options, restrictions or other encumbrances or other adverse claims except the pledge, assignment and security interest created by this Agreement,

(b)  such Pledgor has full power, authority and legal right to execute, deliver and perform its obligations under this Agreement and to pledge, assign and grant a security interest in all of the Collateral pursuant to this Agreement, and

(c)  the execution, delivery and performance hereof and the pledge and assignment of and granting of a security interest in the Collateral hereunder have been duly authorized by such Pledgor and do not contravene any law, rule or regulation or any judgment, decree or order of any tribunal or of any agreement or instrument to which such Pledgor is a party or by which such Pledgor or any of such Pledgor's property is bound or affected or constitute a default thereunder.

Each Pledgor covenants that:

(x) the Pledgor will defend the Agent's rights and security interest in the Collateral against the claims and demands of all persons whomsoever;

(y) the Pledgor will have the like title to and right to pledge and assign and grant a security interest in the Collateral hereafter pledged or assigned or in which a security interest is granted to the Agent hereunder and will likewise defend the Agent's rights, pledge, assignment and security interest thereof and therein;

6.   Remedies .   

The occurrence of the Termination Date (as defined in the Waiver Agreement) shall constitute an “Event of Default” under this Pledge Agreement.  Upon occurrence of any Event of Default, the Agent shall thereafter have the following rights and remedies in addition to the rights and remedies of a secured party under the Uniform Commercial Code of the Commonwealth of Massachusetts, all such rights and remedies being cumulative, not exclusive, and enforceable alternatively, successively or concurrently, at such time or times as the Agent deems expedient:

(a)  the Agent may demand, sue for, collect or make any compromise or settlement the Agent deems suitable in respect of any of the Collateral;

(b)  the Agent may sell, resell, assign or deliver or otherwise dispose of any or all of the Collateral, for cash or credit or both and upon such terms at such place or places, at such time or times and to such entities or other persons as the Agent thinks expedient, all without demand for performance by the Pledgors or any notice or advertisement whatsoever except as expressly provided herein or as may otherwise be required by law and the Agent may instruct any custodian to effect the immediate sale, transfer or other disposition of all or any part of the Collateral;

(c)   the Agent may cause all or any part of the Collateral to be transferred into its name or the name of its nominee or nominees and, for such purpose, without limitation upon any other rights or remedies available to the Agent, may give instructions to such effect to any issuer of any of the Collateral or any broker or other financial intermediary or book-entry custodian in possession of any of the Collateral or upon whose books any of the Collateral is then registered; and

(d)  the Agent may set off or otherwise apply against any of the Obligations any and all sums deposited with it or held by it, including without limitation, any sums standing to the credit of the Cash Collateral Account.

6.1.   Sale of Collateral .    P