Put the folder in \Program Files\Wolfram Research\Mathematica\5.0\AddOns\Applications, and then type
Install["LoopTools\LoopTools.exe"];
Aditionally, you should at least set the following three options:
SetDelta[dlet] integration cut related to dimension
SetMudim[\mu^2] the renormalization scale
SetLambda[\lambda^2] mass cut of gloun or photon
Best regards!
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