Delaware		8731		77-0259 335
(State or Other Jurisdiction of Incorporation or Organization)		(Primary Standard Industrial Classification Code Number)		(I.R.S. Employer Identification Number)

Mark T. Bettencourt, Esq. Edward A. King, Esq. Goodwin Procter LLP Exchange Place Boston, Massachusetts 02109 (617) 570-1000		Mark G. Borden, Esq. Omar White, Esq. Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, Massachusetts 02109 (617) 526-6000

			Proposed Maximum			Amount of
Title of Each Class of Securities to be Registered			Aggregate Offering Price(1)			Registration Fee(2)
Common Stock, $0.01 par value per share			$115,000,000			$13,536

(1)	Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act.
(2)	Calculated pursuant to Rule 457(o) based on an estimate of the proposed maximum aggregate offering price and includes the offering price of shares that the underwriters have the option to purchase to cover over- allotments, if any.

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The information contained in this prospectus is not complete and may be changed. Neither we nor the selling stockholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any state where the offer or sale is not permitted.

	Shares

Underwriting

Proceeds to

Proceeds to

Price to

Discounts and

iRobot

Selling

Public

Commissions

Corporation

Stockholders

Per Share

$

$

$

$

Total

$

$

$

$

MORGAN STANLEY	JPMORGAN

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		Page
Prospectus Summary			1
Risk Factors			5
Forward-Looking Statements			22
Use of Proceeds			23
Dividend Policy			23
Capitalization			24
Dilution			25
Selected Consolidated Financial Data			26
Management’s Discussion and Analysis of Financial Condition and Results of Operations			28
Business			43
Management			62
Certain Relationships and Related Party Transactions			71
Principal and Selling Stockholders			73
Description of Capital Stock			75
Shares Eligible for Future Sale			79
Underwriters			81
Legal Matters			85
Experts			85
Where You Can Find More Information			85
Index to Consolidated Financial Statements			F-1

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This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, especially the risks of investing in our common stock discussed under “Risk Factors” beginning on page 5, and the consolidated financial statements and notes to those consolidated financial statements, before making an investment decision.

iRobot is a leading global provider of robots that enable people to complete complex tasks in a better way. Founded in 1990 by roboticists who performed research at the Massachusetts Institute of Technology, we have developed proprietary technology incorporating advanced concepts in navigation, mobility, manipulation and artificial intelligence to build industry-leading robots. Our Roomba floor vacuuming robot and recently announced Scooba floor washing robot perform time-consuming domestic chores, and our PackBot tactical military robots perform battlefield reconnaissance and bomb disposal. In addition, we are developing the Small Unmanned Ground Vehicle reconnaissance robot for the U.S. Army’s transformational Future Combat Systems program and, in conjunction with Deere & Company, the R-Gator unmanned ground vehicle. We sell our robots to consumers through a variety of distribution channels, including over 7,000 retail locations and our on-line store, and to the U.S. military and other government agencies worldwide.
As of July 2, 2005, we had 214 full-time employees, of whom over half are engineers specializing in the design of robots. We have developed expertise in all the disciplines necessary to build durable, high-performance and cost-effective robots through the close integration of software, electronics and hardware. Our core technologies serve as reusable building blocks that we adapt and expand to develop next generation and new products, reducing the time, cost and risk of product development. Our significant expertise in robot design and engineering, combined with our management team’s experience in military and consumer markets, positions us to capitalize on the expected growth in the market for robots.
Over the past three years, we sold more than 1.2 million of our Roomba floor vacuuming robots. We also sold to the U.S. military during that time more than 200 of our PackBot tactical military robots, most of which have been deployed on missions in Afghanistan and Iraq.

Over the past several decades, the desire to continue to improve productivity and quality of life has led to the development of robots. Historical attempts at producing robots have had limited success due to the inherent complexities in integrating multiple technologies to deliver truly functional robots at affordable prices. Behavior-based robots, which represent a new generation of robots, can effectively deal with dynamic and changing environments, and are particularly well suited for consumer, military and industrial tasks that are repetitive, physically demanding or dangerous. The need for robots has increased in parallel with the evolution of robot technology.
We believe that the demand for robots that can complete domestic chores is developing rapidly due to demographic trends, including the aging population, increasing prevalence of dual-income households, declining birth rates and ongoing reduction in people’s “free” time. According to the 2004 United Nations Economic Commission for Europe in cooperation with the International Federation of Robotics, there will be approximately $2.6 billion spent worldwide on household robots from 2004 through 2007.

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	•	Deliver Great Products and Continue to Expand Our Existing Markets. Our strategy is to deliver innovative products rapidly at economical price points and continue to extend our consumer and military product offerings.
	•	Innovate to Penetrate New Markets. Our culture of innovation and experience enables us to rapidly develop robots for use in a broad range of applications and to penetrate new market segments globally.
	•	Complement Our Core Competencies With Strategic Alliances. We rely on strategic alliances to provide complementary competencies and enhance our ability to enter and compete in new markets.
	•	Leverage Our Research and Development Efforts Across Different Products and Markets. By using our research and development across all our products and markets, our strategy is to develop cost-effective robots and rapidly bring them to market.
	•	Develop an Ecosystem Around Our Platforms. Our extendable product platforms with open interfaces enable us to foster an ecosystem of third-parties enabling us to expand our footprint while maintaining market leadership.
	•	Continue to Strengthen Our Brand. We will reinforce our message of innovation, reliability, safety and value through continued reinvestment in our brand.
	•	Continue to Reinvest Aggressively in Our Business and Our People. We will maximize long-term profitability by reinvesting aggressively in our business and our people over the next several years.

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3

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4

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	•	generate sufficient revenue to maintain profitability;
	•	acquire and maintain market share;
	•	manage growth in our operations;
	•	attract and retain customers;
	•	attract and retain key personnel;
	•	develop and renew government contracts and other strategic relationships;
	•	adapt to a new or changing regulatory environment; and
	•	access additional capital when required and on reasonable terms.

5

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	•	seasonality in the sales of our consumer products;
	•	the size and timing of orders from military and other government agencies;
	•	the mix of products that we sell in the period;
	•	disruption of supply of our products from our manufacturers;
	•	the inability to attract and retain qualified, revenue-generating personnel;
	•	unanticipated costs incurred in the introduction of new products;
	•	costs of labor and raw materials;
	•	our ability to introduce new products and enhancements to our existing products on a timely basis;
	•	price reductions;
	•	the amount of government funding and the political, budgetary and purchasing constraints of our government agency customers; and
	•	cancellations, delays or contract amendments by government agency customers.

6

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	•	terminate contracts for convenience, in whole or in part, at any time and for any reason;
	•	reduce or modify contracts or subcontracts if its requirements or budgetary constraints change;
	•	cancel multi-year contracts and related orders if funds for contract performance for any subsequent year become unavailable;
	•	exercise production priorities, which allow it to require that we accept government purchase orders or produce products under its contracts before we produce products under other contracts, which may displace or delay production of more profitable orders;
	•	claim certain rights in products provided by us; and
	•	control or prohibit the export of certain of our products.

7

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	•	lack of direct control over production capacity and delivery schedules;
	•	lack of direct control over quality assurance, manufacturing yields and production costs;
	•	risk of loss of inventory while in transit from China; and
	•	risks associated with international commerce with China, including unexpected changes in legal and regulatory requirements, changes in tariffs and trade policies, risks associated with the protection of intellectual property and political and economic instability.

8

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	•	the cost, performance and reliability of our products and products offered by our competitors;
	•	public perceptions regarding the effectiveness and value of robots;
	•	customer satisfaction with robots; and
	•	marketing efforts and publicity regarding robots.

9

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	•	changes in government programs that are related to our products and services;
	•	adoption of new laws or regulations relating to government contracting or changes to existing laws or regulations;
	•	changes in political or social attitudes with respect to security and defense issues;
	•	delays or changes in the government appropriations process;
	•	uncertainties associated with the war on terror and other geo-political matters; and
	•	delays in the payment of our invoices by government payment offices.

	•	developers of robotic floor care products such as AB Electrolux, Alfred Kärcher GmbH & Co., Samsung Electronics Co., Ltd., Koolatron Corp. and Yujin Robotic Co. Ltd.;
	•	developers of small unmanned ground vehicles such as Foster-Miller, Inc.— a wholly owned subsidiary of QinetiQ North America, Inc., Allen-Vanguard Corporation, and Remotec— a division of Northrop Grumman Corporation; and
	•	established government contractors working on unmanned systems such as Lockheed Martin Corporation, BAE Systems, Inc. and General Dynamics Corporation.

10

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11

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12

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13

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	•	our collaborators may not devote the resources necessary or may otherwise be unable to complete development and commercialization of these potential products;
	•	our existing collaborations are and future collaborations may be subject to termination on short notice;
	•	our collaborators may be pursuing alternative technologies or developing alternative products, either on their own or in collaboration with others, that may be competitive with our products, which could affect our collaborators’ commitment to the collaboration with us;
	•	reductions in marketing or sales efforts or a discontinuation of marketing or sales of our products by our collaborators could reduce our revenue;
	•	our collaborators may terminate their collaborations with us, which could make it difficult for us to attract new collaborators or adversely affect our perception in the business and financial communities; and
	•	our collaborators may pursue higher priority programs or change the focus of their development programs, which could affect our collaborators’ commitment to us.

	•	the Federal Acquisition Regulations and supplemental agency regulations, which comprehensively regulate the formation and administration of, and performance under government contracts;
	•	the Truth in Negotiations Act, which requires certification and disclosure of all cost and pricing data in connection with contract negotiations;
	•	the Cost Accounting Standards, which impose accounting requirements that govern our right to reimbursement under cost-based government contracts;
	•	the Foreign Corrupt Practices Act;
	•	the False Claims Act and the False Statements Act, which, respectively, impose penalties for payments made on the basis of false facts provided to the government, and impose penalties on the basis of false statements, even if they do not result in a payment; and
	•	laws, regulations and executive orders restricting the use and dissemination of information classified for national security purposes and the exportation of certain products and technical data.

14

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	•	difficulties in integrating the operations, technologies, products, existing contracts, accounting and personnel of the target company and realizing the anticipated synergies of the combined businesses;
	•	difficulties in supporting and transitioning customers, if any, of the target company;
	•	diversion of financial and management resources from existing operations;
	•	the price we pay or other resources that we devote may exceed the value we realize, or the value we could have realized if we had allocated the purchase price or other resources to another opportunity;
	•	risks of entering new markets in which we have limited or no experience;

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	•	potential loss of key employees, customers and strategic alliances from either our current business or the target company’s business;
	•	assumption of unanticipated problems or latent liabilities, such as problems with the quality of the target company’s products; and
	•	inability to generate sufficient revenue to offset acquisition costs.

	•	hire additional personnel;
	•	develop new or enhance existing products;

16

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	•	enhance our operating infrastructure;
	•	acquire businesses or technologies; or
	•	otherwise respond to competitive pressures.

	•	difficulties in staffing, managing and supporting operations in multiple countries;
	•	difficulties in enforcing agreements and collecting receivables through foreign legal systems and other relevant legal issues;
	•	fewer legal protections for intellectual property;
	•	foreign and U.S. taxation issues and international trade barriers;
	•	difficulties in obtaining any necessary governmental authorizations for the export of our products to certain foreign jurisdictions;
	•	potential fluctuations in foreign economies;
	•	government currency control and restrictions on repatriation of earnings;
	•	fluctuations in the value of foreign currencies and interest rates;
	•	general economic and political conditions in the markets in which we operate;
	•	domestic and international economic or political changes, hostilities and other disruptions in regions where we currently operate or may operate in the future; and
	•	different and changing legal and regulatory requirements in the jurisdictions in which we currently operate or may operate in the future.

17

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	•	fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us;
	•	changes in estimates of our financial results or recommendations by securities analysts;
	•	failure of any of our products to achieve or maintain market acceptance;
	•	changes in market valuations of similar companies;

18

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	•	success of competitive products;
	•	changes in our capital structure, such as future issuances of securities or the incurrence of additional debt;
	•	announcements by us or our competitors of significant products, contracts, acquisitions or strategic alliances;
	•	regulatory developments in the United States, foreign countries or both;
	•	litigation involving our company, our general industry or both;
	•	additions or departures of key personnel;
	•	investors’ general perception of us; and
	•	changes in general economic, industry and market conditions.

Number of Shares and
% of Total Outstanding		Date Available for Sale Into Public Market
shares, or     %		On the date of this prospectus
shares, or     %		90 days after the date of this prospectus
shares, or     %		180 days after the date of this prospectus, subject to extension in specified instances, due to lock-up agreements between the holders of these shares and the underwriters. However, Morgan Stanley & Co. Incorporated and J.P. Morgan Securities Inc. can waive the provisions of these lock-up agreements and allow these stockholders to sell their shares at any time
shares, or     %		180 days after the date of this prospectus, subject to extension in specified instances, due to a lock-up agreement between the holders of these shares and us. However, with the underwriters’ consent, we can waive the provisions of these lock-up agreements and allow these stockholders to sell their shares at any time
shares, or     %		Between 181 and 365 days after the date of this prospectus, depending on the requirements of the federal securities laws

19

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	•	limitations on the removal of directors;
	•	a classified board of directors so that not all members of our board are elected at one time;

20

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	•	advance notice requirements for stockholder proposals and nominations;
	•	the inability of stockholders to act by written consent or to call special meetings;
	•	the ability of our board of directors to make, alter or repeal our by-laws; and
	•	the ability of our board of directors to designate the terms of and issue new series of preferred stock without stockholder approval, which could be used to institute a rights plan, or a poison pill, that would work to dilute the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our board of directors.

21

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22

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23

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	•	on an actual basis; and
	•	on an as adjusted basis to give effect to the conversion of our convertible preferred stock and to reflect the sale of                      shares of common stock that we are offering at an assumed initial public offering price of $           per share, which is the midpoint of the range listed on the cover page of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

			As of July 2, 2005
			Actual				As Adjusted
			(unaudited)
			(in thousands)
Preferred stock, $.01 par value, 9,557 shares authorized and issued, actual; 5,000 shares authorized, no shares issued, as adjusted:			$	37,506				—
Stockholders’ equity (deficit):
	Common stock, $.01 par value: 35,000 shares authorized; 10,338 shares issued, actual; 100,000 shares authorized, shares issued, as adjusted			103
	Additional paid-in capital			4,578
	Deferred stock-based compensation			(1,480	)
	Accumulated deficit			(34,044	)
Total stockholders’ equity (deficit)				(30,843	)
Total capitalization			$	6,663

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Assumed initial public offering price per share							$
	Net tangible book value as of July 2, 2005		$
	Increase attributable to this offering
Adjusted net tangible book value per share after this offering
Dilution in net tangible book value per share to new investors							$

Shares Purchased

Total Consideration

Average Price

Number

Percent

Amount

Percent

Per Share

Existing stockholders

%

$

%

$

New investors

$

Total

%

$

%

25

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																								Six Months
																								Ended
				Year Ended December 31,
																								June 30,				July 2,
				2000				2001				2002				2003				2004				2004				2005
																								(unaudited)
				(in thousands, except per share data)
Consolidated Statement of Operations:
Revenue
	Product revenue(1)			$	1,904			$	1,408			$	6,955			$	45,896			$	82,147			$	23,087			$	34,723
	Contract revenue				8,846				12,077				7,223				7,661				12,365				5,039				8,233
	Royalty revenue				—				27				639				759				531				483				62
		Total revenue			10,750				13,512				14,817				54,316				95,043				28,609				43,018
Cost of Revenue
	Cost of product revenue				1,506				1,148				4,896				31,194				59,321				16,471				26,750
	Cost of contract revenue				6,607				8,566				11,861				6,143				8,371				3,345				5,770
		Total cost of revenue			8,113				9,714				16,757				37,337				67,692				19,816				32,520
Gross Profit (Loss)(1)					2,637				3,798				(1,940	)			16,979				27,351				8,793				10,498
Operating Expenses
	Research and development				3,225				1,846				1,736				3,848				5,504				2,563				5,713
	Selling, general and administrative				3,038				4,669				7,128				20,521				21,404				9,188				12,061
	Stock-based compensation(2)				—				—				—				—				—				—				90
		Total operating expenses			6,263				6,515				8,864				24,369				26,908				11,751				17,864
Operating Income (Loss)					(3,626	)			(2,717	)			(10,804	)			(7,390	)			443				(2,958	)			(7,366	)
Other Income (Expense), Net					171				101				45				15				(80	)			(41	)			211
Income (Loss) Before Income Taxes					(3,455	)			(2,616	)			(10,759	)			(7,375	)			363				(2,999	)			(7,155	)
Income Tax Expense					8				16				15				36				144				1				2
Net Income (Loss)				$	(3,463	)		$	(2,632	)		$	(10,774	)		$	(7,411	)		$	219			$	(3,000	)		$	(7,157	)
Net Income (Loss) Per Share
		Basic		$	(0.66	)		$	(0.50	)		$	(2.00	)		$	(0.79	)		$	0.01			$	(0.31	)		$	(0.72	)
		Diluted		$	(0.66	)		$	(0.50	)		$	(2.00	)		$	(0.79	)		$	0.01			$	(0.31	)		$	(0.72	)
Number of Shares Used in Per Share Calculations
		Basic			5,231				5,312				5,391				9,352				9,660				9,530				10,008
		Diluted			5,231				5,312				5,391				9,352				19,183				9,530				10,008
Pro Forma Net Income (Loss) Data(3):
	Pro Forma Net Income (Loss) Per Share
		Basic																		$	0.01							$	(0.37	)
		Diluted																		$	0.01							$	(0.37	)
	Number of Shares Used in Pro Forma Per Share Calculations
		Basic																			18,002								19,565
		Diluted																			19,183								19,565

(1)

Beginning in the first quarter of 2004, we converted from recognizing revenue from U.S. consumer product sales on a “sell-through” basis (when retail stores sold our robots) to a “sell-in” basis (when our robots are shipped to retail stores). As a result of this conversion, our revenue and gross profit in the first quarter of 2004 included $5.7 million and $2.5 million, respectively, from robots shipped prior to 2004.

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(2)	Stock-based compensation recorded in 2005 breaks down by expense classification as follows:

			Six Months Ended
			July 2, 2005
			(unaudited)
			(in thousands)
Cost of product revenue			$	9
Cost of contract revenue				11
Research and development				32
Selling, general and administrative				38
	Total stock-based compensation		$	90

(3)	We have computed the pro forma net income (loss) per share and the pro forma weighted-average shares outstanding included in the statement of operations data as we describe in Note 2 of the notes to our consolidated financial statements.

		As of December 31,
																						As of July 2,
		2000				2001				2002				2003				2004				2005
																						(unaudited)
		(in thousands)
Consolidated Balance Sheet Data:
Cash and cash equivalents		$	806			$	7,179			$	3,014			$	4,620			$	19,441			$	15,090
Total assets			5,241				10,580				8,705				27,827				46,314				40,336
Total liabilities			2,015				3,182				12,049				25,624				33,097				33,672
Total redeemable convertible preferred stock			7,873				14,639				14,639				27,562				37,506				37,506
Total stockholders’ equity (deficit)			(4,646	)			(7,241	)			(17,983	)			(25,359	)			(24,289	)			(30,843	)

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28

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	Cost of Revenue

	Gross Profit

	Research and Development Expenses

	•	salaries and related costs for our engineers;
	•	costs for high technology components used in product and prototype development; and
	•	costs of test equipment used during product development.

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	Selling, General and Administrative Expenses

	•	salaries and related costs for sales and marketing personnel;
	•	salaries and related costs for executives and administrative personnel;
	•	advertising, marketing and other brand-building costs;
	•	professional services costs;
	•	information systems and infrastructure costs;
	•	travel and related costs; and
	•	occupancy and other overhead costs.

	Stock-Based Compensation Expenses

	Fiscal Periods

30

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	Revenue Recognition

	Accounting for Stock-Based Awards

31

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	Accounting for Income Taxes

	Warranty

	Inventory Valuation

32

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																	Six Months Ended
					Fiscal Year Ended December 31,
																	June 30,				July 2,
					2002				2003				2004				2004				2005
																	(unaudited)
					(in thousands)
Revenue
	Product revenue(1)				$	6,955			$	45,896			$	82,147			$	23,087			$	34,723
	Contract revenue					7,223				7,661				12,365				5,039				8,233
	Royalty revenue					639				759				531				483				62
			Total revenue			14,817				54,316				95,043				28,609				43,018
Cost of Revenue
	Cost of product revenue					4,896				31,194				59,321				16,471				26,750
	Cost of contract revenue					11,861				6,143				8,371				3,345				5,770
			Total cost of revenue			16,757				37,337				67,692				19,816				32,520
		Gross profit (loss)(1)				(1,940	)			16,979				27,351				8,793				10,498
Operating Expenses
	Research and development					1,736				3,848				5,504				2,563				5,713
	Selling, general and administrative					7,128				20,521				21,404				9,188				12,061
	Stock-based compensation(2)					—				—				—				—				90
			Total operating expenses			8,864				24,369				26,908				11,751				17,864
		Operating income (loss)				(10,804	)			(7,390	)			443				(2,958	)			(7,366	)
Other income (expense), net						45				15				(80	)			(41	)			211
		Income (loss) before income taxes				(10,759	)			(7,375	)			363				(2,999	)			(7,155	)
Income tax expense						15				36				144				1				2
		Net income (loss)			$	(10,774	)		$	(7,411	)		$	219			$	(3,000	)		$	(7,157	)

(1)	Beginning in the first quarter of 2004, we converted from recognizing revenue from U.S. consumer product sales on a “sell-through” basis (when retail stores sold our robots) to a “sell-in” basis (when our robots are shipped to retail stores). As a result of this conversion, our revenue and gross profit in the first quarter of 2004 included $5.7 million and $2.5 million, respectively, from robots shipped prior to 2004.
(2)	Stock-based compensation recorded in 2005 breaks down by expense classification as follows:

			Six Months Ended
			July 2, 2005
			(unaudited)
			(in thousands)
Cost of product revenue			$	9
Cost of contract revenue				11
Research and development				32
Selling, general and administrative				38
	Total stock-based compensation		$	90

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					Fiscal Year Ended												Six Months Ended
					December 31,
																	June 30,				July 2,
					2002				2003				2004				2004				2005
Revenue
	Product revenue					47.0	%			84.5	%			86.4	%			80.7	%			80.8	%
	Contract revenue					48.7				14.1				13.0				17.6				19.1
	Royalty revenue					4.3				1.4				0.6				1.7				0.1
			Total revenue			100.0				100.0				100.0				100.0				100.0
Cost of Revenue
	Cost of product revenue					33.0				57.4				62.4				57.6				62.2
	Cost of contract revenue					80.1				11.3				8.8				11.7				13.4
			Total cost of revenue			113.1				68.7				71.2				69.3				75.6
		Gross profit (loss)				(13.1	)			31.3				28.8				30.7				24.4
Operating Expenses
	Research and development					11.7				7.1				5.8				9.0				13.3
	Selling, general and administrative					48.1				37.8				22.5				32.1				28.0
	Stock-based compensation					—				—				—				—				0.2
			Total operating expenses			59.8				44.9				28.3				41.1				41.5
		Operating income (loss)				(72.9	)			(13.6	)			0.5				(10.4	)			(17.1	)
Other income (expense), net						0.3				—				(0.1	)			(0.1	)			0.5
		Income (loss) before income taxes				(72.6	)			(13.6	)			0.4				(10.5	)			(16.6	)
Income tax expense						0.1				—				0.2				—				—
		Net income (loss)				(72.7	)%			(13.6	)%			0.2	%			(10.5	)%			(16.6	)%

	Comparison of Six Months Ended July 2, 2005 to Six Months Ended June 30, 2004

	Revenue

	Gross Profit

34

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	Research and Development

	Selling, General and Administrative

	Other Income (Expense), Net

	Income Tax Provision

	Comparison of Years Ended December 31, 2004 and 2003

	Revenue

35

---

 

	Gross Profit

	Research and Development

	Selling, General and Administrative

	Other Income (Expense), Net

	Income Tax Provision

	Comparison of Years Ended December 31, 2003 and 2002

	Revenue

36

---

 

	Gross Profit

	Research and Development

	Selling, General and Administrative

	Other Income (Expense), Net

	Income Tax Provision

37

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					Fiscal Quarter Ended
					March 31,				June 30,				September 30,				December 31,				March 31,				July 2,
					2004				2004				2004				2004				2005				2005
					(unaudited)
					(in thousands)
Revenue
	Product revenue(1)				$	15,812			$	7,275			$	25,502			$	33,558			$	12,531			$	22,193
	Contract revenue					2,221				2,818				3,461				3,865				4,539				3,693
	Royalty revenue					465				18				(15	)			62				62				—
			Total revenue			18,498				10,111				28,948				37,485				17,132				25,886
Cost of Revenue
	Cost of product revenue					10,417				6,053				18,560				24,290				9,834				16,917
	Cost of contract revenue					1,352				1,994				2,101				2,924				3,124				2,645
			Total cost of revenue			11,769				8,047				20,661				27,214				12,958				19,562
		Gross profit(1)				6,729				2,064				8,287				10,271				4,174				6,324
Operating Expenses
	Research and development					1,422				1,141				1,206				1,735				3,048				2,665
	Selling, general and administrative					4,790				4,399				4,139				8,077				5,295				6,766
	Stock-based compensation(2)					—				—				—				—				27				63
			Total operating expenses			6,212				5,540				5,345				9,812				8,370				9,494
		Operating income (loss)				517				(3,476	)			2,942				459				(4,196	)			(3,170	)
Other income (expense), net						(35	)			(5	)			(7	)			(32	)			97				114
	Income (loss) before income taxes					482				(3,481	)			2,935				427				(4,099	)			(3,056	)
Income tax expense						1				—				124				19				2				—
	Net income (loss)				$	481			$	(3,481	)		$	2,811			$	408			$	(4,101	)		$	(3,056	)

(1)	Beginning in the first quarter of 2004, we converted from recognizing revenue from U.S. consumer product sales on a “sell-through” basis (when retail stores sold our robots) to a “sell-in” basis (when our robots are shipped to retail stores). As a result of this conversion, our revenue and gross profit in the first quarter of 2004 included $5.7 million and $2.5 million, respectively, from robots shipped prior to 2004.
(2)	Stock-based compensation recorded in 2005 breaks down by expense classification as follows:

			Fiscal Quarter Ended
			March 31,				July 2,
			2005				2005
			(unaudited)
			(in thousands)
Cost of product revenue			$	3			$	6
Cost of contract revenue				4				7
Research and development				10				22
Selling, general and administrative				10				28
	Total stock-based compensation		$	27			$	63

38

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					Fiscal Quarter Ended
					March 31,				June 30,				September 30,				December 31,				March 31,				July 2,
					2004				2004				2004				2004				2005				2005
Revenue
	Product revenue					85.5	%			72.0	%			88.0	%			89.5	%			73.1	%			85.7	%
	Contract revenue					12.0				27.9				12.0				10.3				26.5				14.3
	Royalty revenue					2.5				0.1				—				0.2				0.4				—
			Total revenue			100.0				100.0				100.0				100.0				100.0				100.0
Cost of Revenue
	Cost of product revenue					56.3				59.9				64.1				64.8				57.4				65.4
	Cost of contract revenue					7.3				19.7				7.3				7.8				18.2				10.2
			Total cost of revenue			63.6				79.6				71.4				72.6				75.6				75.6
		Gross profit				36.4				20.4				28.6				27.4				24.4				24.4
Operating Expenses
	Research and development					7.7				11.3				4.2				4.6				17.8				10.3
	Selling, general and administrative					25.9				43.5				14.3				21.6				30.9				26.1
	Stock-based compensation					—				—				—				—				0.2				0.2
			Total operating expenses			33.6				54.8				18.5				26.2				48.9				36.6
		Operating income (loss)				2.8				(34.4	)			10.1				1.2				(24.5	)			(12.2	)
Other income (expense), net						(0.2	)			—				—				(0.1	)			0.6				0.4
		Income (loss) before income taxes				2.6				(34.4	)			10.1				1.1				(23.9	)			(11.8	)
Income tax expense						—				—				0.4				0.1				—				—
		Net income (loss)				2.6	%			(34.4	)%			9.7	%			1.0	%			(23.9	)%			(11.8	)%

39

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	Discussion of Cash Flows

	Working Capital Facility

40

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	Working Capital and Capital Expenditure Needs

		Payments Due by Period
		Less Than				1 to				3 to
		1 Year				3 Years				5 Years				Total
		(in thousands)
Operating leases		$	929			$	1,519			$	766			$	3,214

41

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	Foreign Currency Risk

	Interest Rate Sensitivity

42

---

 

43

---

 

44

---

 

45

---

 

	iRobot Innovation Engine

46

---

 

47

---

 

48

---

 

49

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	Consumer Products

50

---

 

	•	the ability to sense a “cliff” or drop-off point and to react by reversing course automatically;
	•	a non-marring bumper to clean up to obstacles without damaging furniture or walls;
	•	a wide cleaning path to clean an entire room on a single battery charge;
	•	an edging brush to clean along surface edges;
	•	dirt-sensing, which allows the Roomba robot to detect dirtier areas in the home and respond by increasing and extending the intensity of its cleaning efforts in that concentrated space; and
	•	improved cleaning and maintenance operations, enhancing the user friendliness of the Roomba robot.

51

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	Government and Industrial Products

	Contract Research and Development Projects

52

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	•	Route Reconnaissance. Move ahead of the soldier along a planned route of advance and return maps and video of what lies ahead.
	•	Perimeter Reconnaissance. Traverse the entire perimeter of a building complex and return with maps and video.
	•	Street-Based Reconnaissance. Navigate down city streets using street-following behaviors along with GPS/ INS and return maps and video of the urban terrain. The modular Wayfarer navigation payload connects to the standard PackBot payload interface and includes light detection and ranging, or LIDAR, stereo vision, forward-looking infrared, or FLIR, and inertial navigation system sensor hardware.

53

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	Deere & Company. We have entered into a strategic business agreement with the commercial and consumer equipment division of Deere & Company to explore and potentially collaborate on multiple projects involving technology and product development and commercialization efforts. We have collaborated with Deere & Company on the development of the R-Gator unmanned ground vehicle. Deere & Company has provided funded research and development, access to its M-Gator military utility vehicle platform and certain other technology, and we have provided robot technologies, including our AWARE Robot Intelligence System. We and Deere & Company are currently in the process of producing a limited number of R-Gator prototypes for evaluation by potential government contractors. Net proceeds from sales of the R-Gator will be shared between us and Deere & Company.
	To facilitate management of the R-Gator project and additional collaborative activities, we and Deere & Company have established a joint management committee to develop proposals for projects, oversee and report on the progress and fulfillment of projects, and seek opportunities to further the goals of the strategic business relationship through joint demonstration of technology and products at trade shows, industry days and internal management reviews. We believe that our strategic alliance with Deere & Company will lead to technologies, and later products, that are directly applicable to serving markets such as agricultural and construction equipment, in which we believe autonomous vehicles can play a significant role. Under the agreement, we have agreed not to work with any third party on projects competitive with certain Deere & Company products if Deere & Company makes certain minimum annual payments to us.
	The Clorox Company. We have entered into a joint development and license agreement with The Clorox Company, whereby Clorox is the exclusive provider of the cleaning solution for the Scooba floor washing robot. Our alliance with The Clorox Company allows us to integrate their cleaning technology and know-how into our floor washing robot, improves consumer perception and awareness of our brand by association and through joint marketing, and provides a necessary product component at an affordable price.

	Consumer

54

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• Amazon.com		• Kohl’s
• Bed Bath & Beyond		• Linens ’n Things
• Best Buy		• Mitsui & Co.
• Brookstone		• M. Block & Sons
• BJ’s Wholesale Club		• Sears
• Hammacher Schlemmer		• The Sharper Image
• The Home Depot		• Target
• Home Shopping Network

	Government and Industrial

Research Support Agencies		Military Customers
• U.S. Defense Advanced Research Projects Agency (DARPA)		• U.S. Army
• U.S. Space and Warfare Command (SPAWAR)		• U.S. Marine Corps
• U.S. Army Tank-automotive and Armaments Command (TACOM)		• U.S. Navy
• Technology Support Working Group (TSWG)

	Customer Service and Support

55

---

 

56

---

 

	Team Organization

	Global Engineering

57

---

 

	Spiral Development

	Leveraged Model

	•	developers of robotic floor care products such as AB Electrolux, Alfred Kärcher GmbH & Co., Samsung Electronics Co., Ltd., Koolatron Corp. and Yujin Robotic Co. Ltd.;
	•	developers of small unmanned ground vehicles such as Foster-Miller, Inc.— a wholly owned subsidiary of QinetiQ North America, Inc., Allen-Vanguard Corporation, and Remotec— a division of Northrop Grumman Corporation; and
	•	established government contractors working on unmanned systems such as Lockheed Martin Corporation, BAE Systems, Inc. and General Dynamics Corporation.

58

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59

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	•	the Federal Acquisition Regulations and supplemental agency regulations, which comprehensively regulate the formation and administration of, and performance under government contracts;
	•	the Truth in Negotiations Act, which requires certification and disclosure of all cost and pricing data in connection with contract negotiations;
	•	the Cost Accounting Standards, which impose accounting requirements that govern our right to reimbursement under cost-based government contracts;
	•	the Foreign Corrupt Practices Act;
	•	the False Claims Act and the False Statements Act, which, respectively, impose penalties for payments made on the basis of false facts provided to the government, and impose penalties on the basis of false statements, even if they do not result in a payment; and
	•	laws, regulations and executive orders restricting the use and dissemination of information classified for national security purposes and the exportation of certain products and technical data.

60

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61

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Name		Age				Position
Colin Angle			38			Chief Executive Officer and Director
Helen Greiner			37			President and Chairman of the Board
Rodney Brooks, Ph.D.			50			Chief Technology Officer and Director
Geoffrey P. Clear			55			Senior Vice President, Chief Financial Officer and Treasurer
Joseph W. Dyer			58			Executive Vice President and General Manager
Gregory F. White			41			Executive Vice President and General Manager
Glen D. Weinstein			34			Senior Vice President, General Counsel and Secretary
Ronald Chwang(1)			57			Director
Jacques S. Gansler(2)			70			Director
Andrea Geisser(3)			62			Director
George McNamee(1)(2)(3)			58			Director
Peter Meekin(1)(2)(3)			55			Director

(1)	Member of the compensation committee.
(2)	Member of the nominating and corporate governance committee.
(3)	Member of the audit committee.

62

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63

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	•	appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm;
	•	pre-approving auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm;
	•	reviewing and discussing with management and the independent registered public accounting firm our annual and quarterly financial statements and related disclosures;
	•	coordinating the oversight and reviewing the adequacy of our internal control over financial reporting;
	•	establishing policies and procedures for the receipt and retention of accounting related complaints and concerns; and
	•	preparing the audit committee report required by Securities and Exchange Commission rules to be included in our annual proxy statement.

	•	annually reviewing and approving corporate goals and objectives relevant to compensation of our chief executive officer;
	•	evaluating the performance of our chief executive officer in light of such corporate goals and objectives and determining the compensation of our chief executive officer;

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	•	reviewing and approving the compensation of our other executive officers;
	•	overseeing and administering our compensation, welfare, benefit and pension plans and similar plans; and
	•	reviewing and making recommendations to the board with respect to director compensation.

	•	developing and recommending to the board criteria for board and committee membership;
	•	establishing procedures for identifying and evaluating director candidates including nominees recommended by stockholders;
	•	identifying individuals qualified to become board members;
	•	recommending to the board the persons to be nominated for election as directors and to each of the board’s committees;
	•	developing and recommending to the board a code of business conduct and ethics and a set of corporate governance guidelines; and
	•	overseeing the evaluation of the board and management.

65

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	Compensation Earned

											Long-Term
			Annual Compensation								Compensation
											Awards
											Restricted				Securities
											Stock				Underlying				All Other
Name and Principal Position			Salary				Bonus				Awards				Options				Compensation(1)(2)
Colin Angle			$	234,520			$	151,914			$	71,741				—			$	6,150
	Chief Executive Officer
Helen Greiner				234,512				135,804				71,741				—				6,150
	President
Geoffrey P. Clear				240,757				67,237				24,169				—				6,150
	Senior Vice President, Chief Financial Officer and Treasurer
Gregory F. White				260,467				131,705				443,280				—				6,150
	Executive Vice President and General Manager
Joseph W. Dyer				239,701				104,547				41,251				420,000				6,150
	Executive Vice President and General Manager

(1)	Excludes medical, group life insurance and certain other benefits received by the named executive officers that are available generally to all of our salaried employees and certain perquisites and other personal benefits received by the named executive officers which do not exceed the lesser of $50,000 or 10% of any such named executive officer’s total annual compensation reported in this table.
(2)	Represent 401(k) matching contributions.

	Option Grants in Last Fiscal Year

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																		Potential
																		Realizable Value
		Individual Grants																at Assumed
																		Annual Rates of
		Number of				% of Total												Stock Price
		Securities				Options												Appreciation for
		Underlying				Granted to				Exercise								Option Term
		Options				Employees in				Price Per				Expiration
Name		Granted				2004				Share				Date				5%				10%
Colin Angle			—				—				—				—				—				—
Helen Greiner			—				—				—				—				—				—
Geoffrey P. Clear			—				—				—				—				—				—
Gregory F. White			—				—				—				—				—				—
Joseph W. Dyer			300,000				26.1%			$	2.33				2/18/14
			120,000				10.4%			$	2.78				9/17/14

	Option Exercises in Last Fiscal Year and Fiscal Year-End Option Values

										Number of Securities
										Underlying Unexercised								Value of Unexercised
		Number of								Options at								In-the-Money Options at
		Shares								December 31, 2004								December 31, 2004
		Acquired				Value
Name		on Exercise				Realized				Exercisable				Unexercisable				Exercisable				Unexercisable
Colin Angle			—				—				347,710				—								—
Helen Greiner			—				—				—				—				—				—
Geoffrey P. Clear			53,440			$	119,172				—				80,160				—
Gregory F. White			46,601			$	20,971				42,393				210,586
Joseph W. Dyer			—				—				75,000				345,000

	Amended and Restated 1994 Stock Plan

67

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	Amended and Restated 2001 Special Stock Option Plan

	Amended and Restated 2004 Stock Option and Incentive Plan

68

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	401(k) Plan

	Employment, Severance and Change in Control Arrangements

	•	any breach of the director’s duty of loyalty to us or our stockholders;
	•	any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;
	•	any unlawful payments related to dividends or unlawful stock repurchases, redemptions or other distributions; or
	•	any transaction from which the director derived an improper personal benefit.

	•	we will indemnify our directors, officers and, in the discretion of our board of directors, certain employees to the fullest extent permitted by the Delaware General Corporation Law; and
	•	we will advance expenses, including attorneys’ fees, to our directors and, in the discretion of our board of directors, to our officers and certain employees, in connection with legal proceedings, subject to limited exceptions.

69

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70

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Total Common

Aggregate

Purchaser(1)

Stock Equivalents

Consideration Paid

Investment Participation

Stockholders Associated with Directors

Trident Capital(2)

2,194,680

$

10,604,858

Series E and F

Acer Technology Ventures(3)

2,603,699

7,209,635

Series A, C, D, E and F

First Albany Entities(4)

1,418,165

4,241,126

Series B, C, D, E and F

Fenway Partners(5)

1,339,920

5,464,717

Series D, E and F

(1)	See “Principal Stockholders” for more detail on shares held by these purchasers.
(2)	Trident Capital includes Trident Capital Fund-V, L.P., Trident Capital Fund-V Affiliates Fund, L.P., Trident Capital Fund-V Affiliates Fund (Q), L.P., Trident Capital Fund-V Principals Fund, L.P. and Trident Capital Parallel Fund-V, C.V. Consideration paid to us by Trident Capital for our convertible preferred stock in 2003 and 2004 was $9,500,002 and $1,104,855, respectively. Mr. Meekin, who is one of our directors, is a Managing Director of Trident Capital Management-V, L.L.C., the sole general partner of Trident Capital Fund-V, L.P., Trident Capital Fund-V Affiliates Fund, L.P., Trident Capital Fund-V Affiliates Fund (Q), L.P., and Trident Capital Fund-V Principals Fund, L.P. and the sole investment general partner of Trident Capital Parallel Fund-V, C.V.
(3)	Acer Technology Ventures includes Acer Technology Venture Fund L.P., IP Fund One, L.P. and iD6 Fund, L.P. Consideration paid to us by Acer Technology Ventures for our convertible preferred stock in 1998, 2000, 2001, 2003 and 2004 was $1,550,189,

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	$1,500,001, $1,107,390, $1,900,003 and $1,152,051, respectively. Dr. Chwang, who is one of our directors, is a General Partner of the management company for each of Acer Technology Venture Fund L.P., IP Fund One, L.P. and iD6 Fund, L.P.
(4)	First Albany Entities includes First Albany Companies Inc., First Albany Private Fund 1999, LLC, First Albany Private Fund 2003, LLC, FA Technology Ventures, L.P., and First Albany Private Fund 2004, LLC. Consideration paid to us by First Albany Entities for our convertible preferred stock in 1999, 2000, 2001, 2003 and 2004 was $1,000,006, $1,574,999, $568,861, $300,001 and $797,258, respectively. Mr. McNamee, who is our one our directors, is the Chairman of First Albany Companies Inc.
(5)	Fenway Partners includes FPIP Trust, LLC, FPIP, LLC and Fenway Partners Capital Fund II, L.P. Mr. Geisser, who is one of our directors, is a Managing Director of Fenway Partners, Inc., the Managing Member of FPIP Trust, LLC and FPIP, LLC. Consideration paid to us by Fenway Partners for our convertible preferred stock in 2001, 2003 and 2004 was $4,000,000, $871,844 and $592,872, respectively. Mr. Geisser is also a Managing Director of Fenway Partners II, LLC, the sole General Partner of Fenway Partners Capital Fund II, L.P.

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	•	each person known to us to be the beneficial owner of more than 5% of our common stock;
	•	each named executive officer;
	•	each of our directors;
	•	all of our executive officers and directors as a group; and
	•	each selling stockholder.

Shares Beneficially

Shares Beneficially

Owned Prior

Owned After the

to the Offering

Offering

Shares

Beneficial Owner

Number

Percent

Offered

Number

Percent

5% Stockholders:

Acer Technology Ventures(1)

2,603,699

13.1%

5201 Great America Parkway Suite 270 Santa Clara, CA 95054

Trident Capital(2)

2,194,680

11.0%

325 Riverside Avenue Westport, CT 06880

Grinnell More(3)

1,455,954

7.3%

First Albany Entities(4)

1,418,165

7.1%

677 Broadway Albany, NY 12207

Fenway Partners(5)

1,339,920

6.7%

152 West 57th Street 59th Floor New York, NY 10019

Directors and Named Executive Officers:

Colin Angle(6)

2,252,424

11.1%

Helen Greiner

1,699,619

8.5%

Rodney Brooks, Ph.D.(7)

2,389,695

12.0%

Geoffrey P. Clear(8)

132,285

*

Joseph W. Dyer(9)

89,892

*

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Shares Beneficially

Shares Beneficially

Owned Prior

Owned After the

to the Offering

Offering

Shares

Beneficial Owner

Number

Percent

Offered

Number

Percent

Gregory F. White(10)

457,412

2.3%

Ronald Chwang(1)

2,603,699

13.1%

Jacques S. Gansler(11)

16,667

*

Andrea Geisser(5)

1,339,920

6.7%

George McNamee(12)

180,901

*

Peter Meekin(2)

2,194,680

11.0%

Executive officers and directors as a group (twelve persons)(13)

13,421,596

65.8%

Other Selling Stockholders:

(1)	Consists of 1,737,279 shares held by Acer Technology Venture Fund L.P., 818,420 shares held by IP Fund One, L.P. and 48,000 shares held by iD6 Fund, L.P. Dr. Chwang is a General Partner of the management company for each of Acer Technology Venture Fund L.P., IP Fund One, L.P. and iD6 Fund, L.P., and may be deemed to share voting and investment power with respect to all shares held by those entities. Dr. Chwang disclaims beneficial ownership of such shares except to the extent of his pecuniary interest, if any.
(2)	Consists of 1,966,075 shares held by Trident Capital Fund-V, L.P., 11,427 shares held by Trident Capital Fund-V Affiliates Fund, L.P., 10,904 shares held by Trident Capital Fund-V Affiliates Fund (Q), L.P., 56,905 shared held by Trident Capital Fund-V Principals Fund, L.P. and 149,369 shares held by Trident Capital Parallel Fund-V, C.V. Mr. Meekin is one of six Managing Directors of Trident Capital Management-V, L.L.C., the sole general partner of Trident Capital Fund-V, L.P., Trident Capital Fund-V Affiliates Fund, L.P., Trident Capital Fund-V Affiliates Fund (Q), L.P., and Trident Capital Fund-V Principals Fund, L.P. and the sole investment general partner of Trident Capital Parallel Fund-V, C.V., and may be deemed to share voting and investment power with respect to all shares held by those entities. Mr. Meekin disclaims beneficial ownership of such shares except to the extent of his pecuniary interest, if any.
(3)	Includes 1,029,738 shares held by Real World Interface, Inc. Trust. Mr. More is a trustee of the Real World Interface, Inc. Trust and may be deemed to share voting and investment power with respect to such shares. Mr. More disclaims beneficial ownership of such shares except to the extent of his pecuniary interest, if any.
(4)	Consists of 1,218,336 shares held by First Albany Companies Inc., 22,844 shares held by First Albany Private Fund 1999, LLC, 64,378 shares held by First Albany Private Fund 2003, LLC, 94,658 shares held by FA Technology Ventures, L.P. and 17,949 shares held by First Albany Private Fund 2004, LLC. Through a Special Committee of its Board of Directors, First Albany Companies Inc. exercises sole voting and investment power with respect to all shares held by First Albany Companies Inc., First Albany Private Fund 1999, LLC, First Albany Private Fund 2003, LLC and First Albany Private Fund 2004, LLC.
(5)	Consists of 5,053 shares held by FPIP Trust, LLC, 3,665 shares held by FPIP, LLC and 1,331,202 shares held by Fenway Partners Capital Fund II, L.P. Mr. Geisser is a Managing Director of Fenway Partners, Inc., the Managing Member of FPIP Trust, LLC and FPIP, LLC. Mr. Geisser is also a Managing Director of Fenway Partners II, LLC, the sole General Partner of Fenway Partners Capital Fund II, L.P., and may be deemed to share voting and investment power with respect to all shares held by those entities. Mr. Geisser disclaims beneficial ownership of such shares except to the extent of his pecuniary interest, if any.
(6)	Includes 347,710 shares issuable to Mr. Angle upon exercise of stock options. Also includes 200,000 shares held in a trust for the benefit of certain of his family members.
(7)	Includes 252,000 shares held in a trust for the benefit of certain of his family members. Also includes 204,090 shares held by Robotic Ventures Fund I, L.P., of which Dr. Brooks is a General Partner. Dr. Brooks disclaims beneficial ownership of such shares except to the extent of his pecuniary interest, if any.
(8)	Includes 26,720 shares issuable to Mr. Clear upon exercise of stock options.
(9)	Includes 49,249 shares issuable to Mr. Dyer upon exercise of stock options.

(10)	Includes 8,505 shares issuable to Mr. White upon exercise of stock options.
(11)	Consists of shares issuable to Dr. Gansler upon exercise of stock options.
(12)	Includes 94,658 shares held by FA Technology Ventures, L.P. and 3,495 shares held by FA Technology Managers, LLC. Mr. McNamee is a Partner of the General Partner of FA Technology Ventures, L.P. and may be deemed to share voting and investment power with respect to all shares held thereby. Mr. McNamee is a Manager of FA Technology Managers, LLC and may be deemed to share voting and investment power with respect to all shares held thereby. Mr. McNamee disclaims beneficial ownership of the shares held by FA Technology Ventures, L.P. and FA Technology Managers, LLC except to the extent of his pecuniary interest, if any.
(13)	Includes an aggregate of 496,851 shares issuable upon exercise of stock options held by six executive officers and directors.

74

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75

---

 

76

---

 

	•	before the stockholder became interested, the board of directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
	•	upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, shares owned by persons who are directors and also officers, and employee stock plans, in some instances; or
	•	at or after the time the stockholder became interested, the business combination was approved by the board of directors of the corporation and authorized at an annual or special meeting of the

77

---

 

		stockholders by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder.

78

---

 

		Shares Eligible
Days After Date of this Prospectus		for Sale				Comment
Upon Effectiveness						Shares sold in the offering
Upon Effectiveness						Freely tradable shares saleable under Rule 144(k) that are not subject to the lock-up
90 Days						Shares saleable under Rules 144 and 701 that are not subject to a lock-up
180 Days						Lock-up released, subject to extension; shares saleable under Rules 144 and 701
Thereafter						Restricted securities held for one year or less

	•	offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for common stock; or
	•	enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of our common stock,

79

---

 

	•	1% of the number of shares of our common stock then outstanding, which will equal approximately                      shares immediately after this offering; or
	•	the average weekly trading volume in our common stock on the NASDAQ National Market during the four calendar weeks preceding the filing of a notice on Form 144 with respect to such sale.

80

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Name		Number of Shares
Morgan Stanley & Co. Incorporated
J.P. Morgan Securities Inc.
First Albany Capital Inc.
Needham & Company, LLC
Adams Harkness, Inc.
Total

81

---

 

	•	offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for common stock; or
	•	enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of our common stock,

	•	the sale of shares to the underwriters;
	•	the issuance by us of shares of our common stock upon the exercise of an option or a warrant or the conversion of a security outstanding on the date of this prospectus of which the underwriters have been advised in writing;
	•	transactions by anyone other than us relating to shares of common stock or other securities acquired in open market transactions after the completion of the offering of the shares;
	•	transfers of shares or any security convertible into our common stock as a bona fide gift; or
	•	distributions by a selling stockholder of shares or any security convertible into our common stock to limited partners or stockholders of the selling stockholder,

	•	during the last 17 days of the 180-day period, we issue an earnings release or material news or a material event relating to us occurs; or
	•	prior to the expiration of the 180-day period, we announce that we will release earnings results during the 16-day period beginning on the last day of the 180-day period,

Paid by Selling

Paid by Us

Stockholders

Total

No Exercise

Full Exercise

No Exercise

Full Exercise

No Exercise

Full Exercise

Per share

$

$

$

$

$

$

Total

$

$

$

$

$

$

82

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83

---

 

84

---

 

85

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		Page
Report of Independent Registered Public Accounting Firm			F-2
Consolidated Balance Sheets			F-3
Consolidated Statements of Operations			F-4
Consolidated Statements of Stockholders’ Equity (Deficit)			F-5
Consolidated Statements of Cash Flows			F-6
Notes to Consolidated Financial Statements			F-7

F-1

---

 

F-2

---

 

				December 31,												July 2,
												July 2,				2005
				2003				2004				2005				(Pro Forma)
												(unaudited)
ASSETS
Current assets:
	Cash and cash equivalents			$	4,619,937			$	19,440,843			$	15,090,230			$	15,090,230
	Accounts receivable, net of allowance of $247,921 at December 31, 2003, and $50,000 at December 31, 2004 and at July 2, 2005				8,137,517				14,436,269				7,344,671				7,344,671
	Unbilled revenue				1,142,784				774,025				929,944				929,944
	Inventory, net				11,419,611				7,668,934				12,399,474				12,399,474
	Other current assets				798,045				399,702				479,072				479,072
		Total current assets			26,117,894				42,719,773				36,243,391				36,243,391
Property and equipment, net					1,605,033				3,512,510				4,010,207				4,010,207
Other assets					103,719				82,000				82,000				82,000
		Total assets		$	27,826,646			$	46,314,283			$	40,335,598			$	40,335,598
LIABILITIES, REDEEMABLE CONVERTIBLE
PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
	Accounts payable			$	6,781,412			$	19,581,065			$	19,611,817			$	19,611,817
	Revolving line of credit				1,338,980				—				—				—
	Accrued expenses				2,802,666				3,819,937				4,029,378				4,029,378
	Accrued compensation				2,032,299				3,150,761				2,763,659				2,763,659
	Provision for contract settlements				5,333,619				5,190,798				5,239,124				5,239,124
	Deferred revenue				7,201,339				1,287,935				2,028,149				2,028,149
		Total current liabilities			25,490,315				33,030,496				33,672,127				33,672,127
Long-term liabilities					133,200				66,600				—				—
Commitments and contingencies (Note 13):
Redeemable convertible preferred stock (Note 8)					27,561,869				37,506,236				37,506,236				—
Common stock, $0.01 par value, 18,500,000, 35,000,000 and 35,000,000 shares authorized and 9,360,750, 10,129,457 and 10,337,574 shares issued and outstanding at December 31, 2003 and 2004 and July 2, 2005, respectively					93,608				101,294				103,375				198,947
Additional paid-in capital					1,695,966				2,925,496				4,577,829				41,988,493
Note receivable from stockholder					(43,000	)			(43,000	)			—				—
Deferred compensation					—				(386,587	)			(1,480,231	)			(1,480,231	)
Accumulated deficit					(27,105,312	)			(26,886,252	)			(34,043,738	)			(34,043,738	)
		Total stockholders’ equity (deficit)			(25,358,738	)			(24,289,049	)			(30,842,765	)			6,663,471
		Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit)		$	27,826,646			$	46,314,283			$	40,335,598			$	40,335,598

F-3

---

 

				Fiscal Year Ended												Six Months Ended
				December 31,				December 31,				December 31,				June 30,				July 2,
				2002				2003				2004				2004				2005
																(unaudited)
Revenue:
Product revenue				$	6,955,215			$	45,896,313			$	82,147,080			$	23,087,249			$	34,723,592
Contract revenue					7,222,589				7,661,244				12,365,114				5,038,983				8,232,950
Royalty revenue					638,704				758,595				530,955				483,316				62,037
	Total revenue				14,816,508				54,316,152				95,043,149				28,609,548				43,018,579
Cost of revenue:
Cost of product revenue					4,896,025				31,193,513				59,321,238				16,471,000				26,750,347
Cost of contract revenue					11,860,610				6,143,347				8,370,487				3,345,591				5,770,138
	Total cost of revenue				16,756,635				37,336,860				67,691,725				19,816,591				32,520,485
Gross profit (loss)					(1,940,127	)			16,979,292				27,351,424				8,792,957				10,498,094
Operating expenses:
Research and development					1,735,831				3,848,010				5,504,321				2,563,083				5,712,525
Selling, general and administrative					7,128,105				20,521,298				21,404,106				9,188,128				12,061,316
Stock-based compensation(1)					—				—				—				—				90,489
	Total operating expenses				8,863,936				24,369,308				26,908,427				11,751,211				17,864,330
Operating income (loss)					(10,804,063	)			(7,390,016	)			442,997				(2,958,254	)			(7,366,236	)
Other (expense) income, net					44,764				15,282				(79,762	)			(41,069	)			211,000
Income (loss) before income taxes					(10,759,299	)			(7,374,734	)			363,235				(2,999,323	)			(7,155,236	)
Income tax expense					14,695				36,227				144,175				1,306				2,250
Net income (loss)				$	(10,773,994	)		$	(7,410,961	)		$	219,060			$	(3,000,629	)		$	(7,157,486	)
Net income (loss) per share
		Basic		$	(2.00	)		$	(0.79	)		$	0.01			$	(0.31	)		$	(0.72	)
		Diluted		$	(2.00	)		$	(0.79	)		$	0.01			$	(0.31	)		$	(0.72	)
Number of shares used in per share calculations
		Basic			5,390,679				9,351,880				9,659,993				9,530,022				10,007,932
		Diluted			5,390,679				9,351,880				19,182,595				9,530,022				10,007,932

(1)	Stock-based compensation recorded in 2005 breaks down by expense classification as follows:

			Six Months Ended
			July 2, 2005
			(unaudited)
Cost of product revenue			$	8,835
Cost of contract revenue				10,998
Research and development				31,832
Selling, general and administrative				38,824
	Total stock-based compensation		$	90,489

F-4

---

 

														Note
		Common Stock								Additional				Receivable
										Paid-In				from				Deferred				Accumulated
		Shares				Value				Capital				Stockholder				Compensation				Deficit				Total
Balance at December 31, 2002			9,291,760			$	92,918			$	1,661,896			$	(43,000	)		$	—			$	(19,694,351	)		$	(17,982,537	)
Issuance of common stock warrants related to debt financing											22,312																22,312
Issuance of common stock for exercise of stock options			68,990				690				11,758																12,448
Net loss																							(7,410,961	)			(7,410,961	)
Balance at December 31, 2003			9,360,750				93,608				1,695,966				(43,000	)			—				(27,105,312	)			(25,358,738	)
Issuance of restricted stock			397,584				3,976				967,217								(669,912	)							301,281
Amortization of deferred compensation relating to restricted stock																			283,325								283,325
Issuance of common stock for exercise of stock options			371,123				3,710				262,313																266,023
Net income																							219,060				219,060
Balance at December 31, 2004			10,129,457				101,294				2,925,496				(43,000	)			(386,587	)			(26,886,252	)			(24,289,049	)
Amortization of deferred compensation relating to restricted stock																			100,340								100,340
Issuance of Common Stock for exercise of stock options			208,117				2,081				367,860																369,941
Repayment of note receivable from stockholder															43,000												43,000
Deferred compensation relating to issuance of stock options											1,284,473								(1,284,473	)							—
Amortization of deferred compensation relating to stock options																			90,489								90,489
Net loss																							(7,157,486	)			(7,157,486	)
Balance at July 2, 2005 (unaudited)			10,337,574			$	103,375			$	4,577,829			$	—			$	(1,480,231	)		$	(34,043,738	)		$	(30,842,765	)

F-5

---

 

				Fiscal Year Ended												Six Months Ended
				December 31,				December 31,				December 31,				June 30,				July 2,
				2002				2003				2004				2004				2005
																(unaudited)
Cash flows from operating activities:
Net income (loss)				$	(10,773,994	)		$	(7,410,961	)		$	219,060			$	(3,000,629	)		$	(7,157,486	)
Adjustments to reconcile net loss to net cash used in operating activities
	Depreciation and amortization				511,335				735,170				1,313,705				389,188				886,864
	Loss on disposal of fixed assets				—				29,384				1,265				—				—
	Interest expense relating to issuance of warrants				—				22,312				—				—				—
	Amortization of deferred compensation				—				—				283,325				177,328				190,829
	Changes in working capital— (use) source
		Accounts receivable and related party trade receivables			237,164				(7,481,472	)			(6,298,751	)			4,663,824				7,091,598
		Unbilled revenue			(325,371	)			(526,573	)			368,759				832,041				(155,919	)
		Inventory			(1,829,773	)			(8,795,412	)			3,750,677				8,277,867				(4,730,540	)
		Other current assets			(434,970	)			(146,481	)			420,061				574,990				(79,370	)
		Accounts payable			3,869,832				1,908,212				12,799,653				(1,074,734	)			30,752
		Accrued expenses			219,778				2,582,888				1,017,271				(836,895	)			209,441
		Accrued compensation			679,609				295,001				1,118,462				138,127				(387,102	)
		Provision for contract settlement			2,361,055				1,377,835				(142,821	)			(87,502	)			48,326
		Deferred revenue			1,787,035				5,952,843				(5,913,405	)			(6,517,187	)			740,214
		Change in long-term liabilities			—				133,200				(66,600	)			(66,600	)			(66,600	)
Net cash provided by (used in) operating activities					(3,698,300	)			(11,324,054	)			8,870,661				3,469,818				(3,378,993	)
Cash flows from investing activities:
Purchase of property and equipment					(448,412	)			(1,329,913	)			(3,222,446	)			(758,315	)			(1,384,561	)
Cash flows from financing activities:
Principal payments on capital lease obligations					(51,009	)			(14,102	)			—				—				—
Borrowings under revolving line of credit, net					—				1,338,980				(1,338,980	)			(1,338,980	)			—
Repayment of note receivable from stockholder					—				—				—				—				43,000
Proceeds from stock option exercises					32,894				12,448				266,024				225,724				369,941
Proceeds from issuance of restricted stock					—				—				301,281				301,281				—
Net proceeds from sale of preferred stock					—				12,922,735				9,944,366				(270	)			—
Net cash provided by financing activities					(18,115	)			14,260,061				9,172,691				(812,245	)			412,941
Net increase in cash and cash equivalents					(4,164,827	)			1,606,094				14,820,906				1,899,258				(4,350,613	)
Cash and cash equivalents, at beginning of period					7,178,670				3,013,843				4,619,937				4,619,937				19,440,843
Cash and cash equivalents, at end of period				$	3,013,843			$	4,619,937			$	19,440,843			$	6,519,195			$	15,090,230
Supplemental disclosure of cash flow information
Cash paid for interest				$	8,621			$	28,572			$	142,367			$	67,955			$	5,665
Cash paid for income taxes					14,756				14,206				123,941				—				6,800
Supplemental disclosure of noncash investing and financing activities
During 2004, 2003 and 2002, the Company transferred $186,011, $16,960 and $115,595, respectively, of inventory to fixed assets.
During the first six months of 2005 and 2004, the Company transferred $140,489 and $1,815, respectively, of inventory to fixed assets.

F-6

---

 

1.	Nature of the Business

	Liquidity and Operations

2.	Summary of Significant Accounting Policies

	Unaudited Interim Financial Statements

	Unaudited Pro Forma Presentation

F-7

---

 

	Fiscal Year-End

	Cash and Cash Equivalents

	Revenue Recognition

	Allowance for Doubtful Accounts

F-8

---

 

Balance at December 31, 2001			$	—
	Provision			30,000
	Deduction
Balance at December 31, 2002				30,000
	Provision			237,329
	Deduction			(19,408	)
Balance at December 31, 2003				247,921
	Provision			(64,835	)
	Deduction			(133,086	)
Balance at December 31, 2004			$	50,000
	Provision			—
	Deduction			—
Balance at July 2, 2005			$	50,000

	Inventory

Balance at December 31, 2001			$	385,900
	Provision			174,686
	Deduction			(224,810	)
Balance at December 31, 2002				335,776
	Provision			2,214,656
	Deduction			(181,878	)
Balance at December 31, 2003				2,368,554
	Provision			—
	Deduction			(465,637	)
Balance at December 31, 2004			$	1,902,917
	Provision			—
	Deduction			(90,549	)
Balance at July 2, 2005			$	1,812,368

F-9

---

 

	Property and Equipment

		Estimated
		Useful Life
Computer and research equipment		3 years
Furniture		5
Machinery		2-5
Business applications software		5
Capital leases and leasehold improvements		Term of lease

	Impairment of Long-Lived Assets

	Research and Development

	Internal Use Software

	Use of Estimates

F-10

---

 

	Reclassification

	Concentration of Credit Risk and Significant Customers

	Investment in Affiliates

	Stock-Based Compensation

F-11

---

 

			Fiscal Year Ended												Six Months Ended
			December 31,				December 31,				December 31,				June 30,				July 2,
			2002				2003				2004				2004				2005
															(unaudited)
Net income (loss)
As reported			$	(10,773,994	)		$	(7,410,961	)		$	219,060			$	(3,000,629	)		$	(7,157,486	)
Add back: Stock-based employee compensation expense reported in net loss				—				—				283,325				177,328				190,829
Less: Stock-based employee compensation expense determined under fair-value method for all awards				(28,917	)			(52,863	)			(394,102	)			(222,411	)			(361,895	)
Pro forma income (loss)			$	(10,802,911	)		$	(7,463,824	)		$	108,283			$	(3,045,712	)		$	(7,328,552	)
Net income (loss) per share, as reported
	Basic			$(2.00	)			$(0.79	)			$0.01				$(0.31	)			$(0.72	)
	Diluted			$(2.00	)			$(0.79	)			$0.01				$(0.31	)			$(0.72	)
Pro forma net income (loss) per share
	Basic			$(2.00	)			$(0.80	)			$0.01				$(0.32	)			$(0.73	)
	Diluted			$(2.00	)			$(0.80	)			$0.01				$(0.32	)			$(0.73	)
Number of shares used in per share calculations
	Basic			5,390,679				9,351,880				9,659,993				9,530,022				10,007,932
	Diluted			5,390,679				9,351,880				19,182,595				9,530,022				10,007,932

		2002				2003				2004
Risk-free interest rate			2.8%				3.0%				3.4%
Expected dividend yield			—				—				—
Expected life			5 years				5  years				5  years
Expected volatility			—				—				—

	Earnings Per Share

	Advertising Expense

F-12

---

 

	Income Taxes

	Lease Termination Costs

	Comprehensive Income (Loss)

	Recent Accounting Pronouncements

3.	Inventory

		December 31,
										July 2,
		2003				2004				2005
										(unaudited)
Raw materials		$	1,510,995			$	427,181			$	707,465
Work in process			145,919				—				—
Finished goods			9,762,697				7,241,753				11,692,009
		$	11,419,611			$	7,668,934			$	12,399,474

F-13

---

 

4.	Property and Equipment

		December 31,
		2003				2004				July 2, 2005
										(unaudited)
Computer and equipment		$	1,682,876			$	2,826,932			$	3,997,600
Furniture			59,954				160,942				164,298
Machinery			935,820				2,544,330				2,593,176
Leasehold improvements			194,700				272,107				350,045
Software purchased for internal use			630,323				919,636				1,003,390
Leased equipment			144,682				144,682				144,682
			3,648,355				6,868,629				8,253,191
Less: accumulated depreciation and amortization			2,043,322				3,356,119				4,242,984
		$	1,605,033			$	3,512,510			$	4,010,207

5.	Accrued Expenses

		December 31,
		2003				2004				July 2, 2005
										(unaudited)
Accrued warranty		$	1,522,228			$	1,398,382			$	2,028,425
Accrued lease termination costs			326,324				37,879				—
Accrued rent			389,687				339,172				318,058
Accrued sales commissions			200,375				554,919				312,165
Accrued accounting fees			171,000				161,000				95,563
Accrued co-op advertising allowance			64,931				1,176,791				1,142,811
Accrued other			128,121				151,794				132,356
		$	2,802,666			$	3,819,937			$	4,029,378

6.	Revolving Line of Credit

F-14

---

 

7.	Common Stock

8.	Redeemable Convertible Preferred Stock

		December 31,
		2003				2004
Series F; 1,412,430 shares authorized, issued and outstanding at December 31, 2004, net of issuance costs (liquidation preference $10,000,004)		$	—			$	9,944,637
Series E; 2,799,353 shares authorized, issued and outstanding at December 31, 2004 and 3,002,069 shares authorized, 2,799,353 issued and outstanding at December 31, 2003, net of issuance costs (liquidation preference $13,044,985)			12,922,735				12,922,465
Series D; 1,870,908 and 2,500,000 shares authorized, 1,870,908 issued and outstanding at December 31, 2004 and 2003, net of issuance costs (liquidation preference $7,000,002)			6,766,550				6,766,550
Series C; 1,470,000 shares authorized, issued and outstanding at December 31, 2004 and 2003, net of issuance costs (liquidation preference $5,500,005)			5,478,244				5,478,244
Series B; 668,185 shares authorized, issued and outstanding at December 31, 2004 and 2003, net of issuance costs (liquidation preference $1,000,006)			966,761				966,761
Series A; 1,336,370 shares authorized, issued and outstanding at December 31, 2004 and 2003, net of issuance costs (liquidation preference $1,550,189)			1,427,579				1,427,579
		$	27,561,869			$	37,506,236

	Conversion Rights

F-15

---

 

	Dividend Rights

	Voting Rights

	Liquidation Rights

	Change in Control

9.	Note Receivable from Stockholder

F-16

---

 

10.	Stock Option Plan

F-17

---

 

		Number of				Weighted Average
		Shares				Exercise Price
Outstanding at December 31, 2002			1,579,708			$	0.584
Granted			494,455				2.294
Exercised			(68,990	)			0.171
Canceled			(21,715	)			1.034
Outstanding at December 31, 2003			1,983,458				1.019
Granted			1,544,959				2.170
Exercised			(768,707	)			0.737
Canceled			(154,710	)			1.790
Outstanding at December 31, 2004			2,605,000				1.770
Weighted average fair value of options granted during 2004						$	0.416
Options available for future grant at December 31, 2004			290,973

						Options
						Outstanding								Options Exercisable
						Weighted
						Average				Weighted								Weighted
						Remaining				Average								Average
		Number				Contractual				Exercise				Number				Exercise
Exercise Price		Outstanding				Life				Price				Exercisable				Price
$0.0002			378,710				2.52	years		$	0.0002				378,710			$	0.0002
0.24			191,380				4.25				0.24				191,380				0.24
0.50			7,940				4.93				0.50				7,940				0.50
0.55			247,038				7.97				0.55				58,018				0.55
1.87			219,028				5.96				1.87				166,278				1.87
2.33			901,654				8.96				2.33				201,333				2.33
2.78			614,675				9.55				2.78				2,050				2.78
4.60			44,575				9.92				4.60				—				—
$0.0002-$4.60			2,605,000				7.48			$	1.770				1,005,709			$	0.863

11.	Warrants

F-18

---

 

12.	Income Taxes

			2002				2003				2004
Current
	Federal		$	—			$	33,285			$	89,794
	State			14,695				2,942				54,381
			$	14,695			$	36,227			$	144,175

				2003				2004
Deferred tax asset
	Net operating loss carryforwards			$	4,997,578			$	5,184,200
	Tax credits				735,387				1,019,900
	Reserves and accruals				5,313,241				5,228,000
		Total deferred tax asset			11,046,206				11,432,100
Valuation allowance					(11,046,206	)			(11,432,100	)
		Net deferred tax asset		$	—			$	—

F-19

---

 

		2002				2003				2004
Expected federal income tax		$	(3,770,898	)		$	(2,521,382	)		$	123,531
Permanent items			5,914				21,874				45,112
State taxes			(551,993	)			(411,920	)			(302,183	)
Credits			75,011				(165,387	)			(165,600	)
Other			—				—				57,488
Increase in valuation allowance			4,256,661				3,113,042				385,827
		$	14,695			$	36,227			$	144,175

13.	Commitments and Contingencies

	Legal

F-20

---

 

	Lease Obligations

			Operating Leases
2005			$	929,180
2006				771,989
2007				746,630
2008				766,394
2009				—
Thereafter				—
	Total minimum lease payments		$	3,214,193

	Guarantees and Indemnification Obligations

	Warranty

Balance, December 31, 2002		$	8,063
Provisions			1,514,165
Warranty settlements			—
Balance, December 31, 2003			1,522,228
Provisions			1,277,811
Warranty settlements			(1,401,657	)
Balance, December 31, 2004			1,398,382
Provisions			2,144,127
Warranty settlements			(1,514,084	)
Balance, July 2, 2005 (unaudited)		$	2,028,425

F-21

---

 

	Restricted Cash

14.	Employee Benefits

15.	Related Party Transactions

16.	Business Segment Information

	Consumer

F-22

---

 

	Government and Industrial

	Other

				Fiscal Year Ended
																Six Months Ended
				December 31,				December 31,				December 31,
				2002				2003				2004				June 30, 2004				July 2, 2005
																(unaudited)
Revenue:
	Consumer			$	—			$	43,073,149			$	71,332,584			$	19,400,585			$	19,573,344
	Government & Industrial				—				11,243,003				23,231,496				8,777,533				23,383,198
	Other				14,816,508				—				479,069				431,430				62,037
		Total revenue			14,816,508				54,316,152				95,043,149				28,609,548				43,018,579
Cost of revenue:
	Consumer				—				27,386,629				48,281,833				12,279,393				14,497,592
	Government & Industrial				—				9,950,231				19,307,902				7,537,198				18,034,011
	Other				16,756,635				—				101,990				—				(11,118	)
		Total cost of revenue			16,756,635				37,336,860				67,691,725				19,816,591				32,520,485
Gross Profit:
	Consumer				—				15,686,520				23,050,751				7,121,192				5,075,752
	Government & Industrial				—				1,292,772				3,923,594				1,240,335				5,349,187
	Other				(1,940,127	)			—				377,079				431,430				73,155
		Total gross profit		$	(1,940,127	)		$	16,979,292			$	27,351,424			$	8,792,957			$	10,498,094

17.	Subsequent Event

F-23

---

 

---

 

Item 13.	Other Expenses of Issuance and Distribution.

SEC registration fee			$	13,536
NASD filing fee				12,000
NASDAQ National Market listing fee				*
Printing and engraving expenses				*
Legal fees and expenses				*
Accounting fees and expenses				*
Blue Sky fees and expenses (including legal fees)				*
Transfer agent and registrar fees and expenses				*
Miscellaneous				*
	Total		$	*

*	To be filed by amendment.

Item 14.	Indemnification of Directors and Officers.

II-1

---

 

II-2

---

 

Item 15.	Recent Sales of Unregistered Securities.

(a)	Issuances of Capital Stock.

(b)	Grants and Exercises of Stock Options.

Item 16.	Exhibits.

Item 17.	Undertakings.

II-3

---

 

	(1) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
	(2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-4

---

 

	iROBOT CORPORATION

	By:	/s/ Colin M. Angle

	Colin M. Angle
	Chief Executive Officer and Director

Signature				Title(s)
/s/ Colin M. Angle   Colin M. Angle				Chief Executive Officer and Director (Principal Executive Officer)
/s/ Helen Greiner   Helen Greiner				President and Chairman of the Board
/s/ Geoffrey P. Clear   Geoffrey P. Clear				Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer and Accounting Officer)
/s/ Ronald Chwang   Ronald Chwang				Director
/s/ Jacques S. Gansler   Jacques S. Gansler				Director
/s/ Rodney A. Brooks   Rodney A. Brooks				Director
/s/ Andrea Geisser   Andrea Geisser				Director
/s/ George C. McNamee   George C. McNamee				Director
/s/ Peter Meekin   Peter Meekin				Director

II-5

---

 

Number				Description
	1	.1*		Form of Underwriting Agreement
	3	.1*		Amended and Restated Certificate of Incorporation of the Registrant
	3	.2*		Form of Second Amended and Restated Certificate of Incorporation of the Registrant (to be effective upon the completion of the offering)
	3	.3*		Amended and Restated By-laws of the Registrant
	4	.1*		Specimen Stock Certificate for shares of the Registrant’s Common Stock
	5	.1*		Opinion of Goodwin Procter LLP
	10	.1		Fifth Amended and Restated Registration Rights Agreement by and among the Registrant, the Investors and the Stockholders named therein, dated as of November 10, 2004
	10	.2*		Form of Indemnification Agreement between the Registrant and its Directors and Officers
	10	.3†*		Registrant’s 2005 Incentive Compensation Plan
	10	.4†		Amended and Restated 1994 Stock Plan and forms of agreements thereunder
	10	.5†*		Amended and Restated 2001 Special Stock Option Plan and forms of agreements thereunder
	10	.6†*		Amended and Restated 2004 Stock Option and Incentive Plan and forms of agreements thereunder
	10	.7*		Lease Agreement between the Registrant and Burlington Crossing Office LLC for the premises located at 63 South Avenue, Burlington, Massachusetts, dated as of October 29, 2002
	10	.8		Warrant to Purchase Common Stock of the Registrant issued to Silicon Valley Bank, dated as of January 30, 2003
	10	.9		Loan and Security Agreement between the Registrant and Fleet National Bank, dated as of May 26, 2005
	10	.10†*		Employment Agreement between the Registrant and Colin Angle, dated as of January 1, 1997
	10	.11†*		Employment Agreement between the Registrant and Helen Greiner, dated as of January 1, 1997
	10	.12†*		Employment Agreement between the Registrant and Geoffrey P. Clear, dated as of March 28, 2003
	10	.13†*		Employment Agreement between the Registrant and Joseph W. Dyer, dated as of February 18, 2004
	10	.14†*		Employment Agreement between the Registrant and Gregory F. White, dated as of February 18, 2004
	10	.15†*		Independent Contractor Agreement between the Registrant and Rodney Brooks, dated as of December 30, 2002
	10	.16		Government Contract DAAE07-03-9-F001 (Small Unmanned Ground Vehicle)
	10	.17		Government Contract N00174-03-D-0003 (Man Transportable Robotic System)
	23	.1*		Consent of Goodwin Procter LLP (included in Exhibit 5.1)
	23	.2		Consent of PricewaterhouseCoopers LLP
	24	.1		Power of Attorney (included in page II-5)

*	To be filed by amendment.

†	Indicates a management contract or any compensatory plan, contract or arrangement.

                                                                    EXHIBIT 10.1

            FIFTH AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT

      THIS FIFTH AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this
"Agreement") is made as of this 10th day of November, 2004 by and among (1)
iRobot Corporation, a Delaware corporation (the "Company"); (2) Rodney Brooks,
Colin M. Angle, Helen Greiner, David Adler and Grinnell More (each, a "Founder"
and collectively, the "Founders"); (3) Hasbro, Inc., a Rhode Island corporation
("Hasbro"); (4) Acer Technology Venture Fund L.P., a Cayman Islands limited
partnership ("Acer"); (5) First Albany Companies, Inc., a New York corporation
("FAC"); (6) the holders of the Company's Series C Convertible Preferred Stock,
$.01 par value per share (the "Series C Preferred Stock") set forth on Schedule
I hereto (collectively, the "Series C Investors"); (7) the holders of the
Company's Series D Convertible Preferred Stock, $.01 par value per share (the
"Series D Preferred Stock") set forth on Schedule I hereto (collectively, the
"Series D Investors"), (8) the holders of the Company's Series E Convertible
Preferred Stock, $.01 par value per share (the "Series E Preferred Stock") set
forth on Schedule I hereto, (9) the holders of the Company's Series F
Convertible Preferred Stock, $.01 par value per share (the "Series F Investors")
set forth on Schedule I attached hereto and, from and after the time that it
becomes a party to this Agreement by execution of a counterpart signature page
in substantially the form attached as Exhibit A countersigned by the Company (a
"Counterpart Signature Page"), each additional holder of Series F Preferred
Stock executing a Counterpart Signature Page (each of Acer, FAC, Hasbro, the
Series C Investors, the Series D Investors, the Series E Investors and the
Series F Investors being referred to herein individually as an "Investor" and
all collectively being referred to as the "Investors"); (10) the stockholders
identified on Schedule I hereto as the Additional Stockholders; and (11) any
other stockholder, warrantholder or optionholder who from time to time becomes a
party to this Agreement by execution of a Joinder Agreement in the form attached
as Exhibit B hereto (collectively, the "Additional Stockholders"). The Founders
and the Additional Stockholders are herein referred to collectively as the
"Stockholders" and individually as a "Stockholder."

      WHEREAS, all of the parties hereto except the Series F Investors are
parties to that certain Fourth Amended and Restated Registration Rights
Agreement dated as of February 28, 2003 (the "Prior Agreement") amending and
restating a Third Amended and Restated Registration Rights Agreement dated as of
August 24, 2001, which amended and restated a Second Amended and Restated
Registration Rights Agreement dated as of February 15, 2000, which amended and
restated a Registration Rights Agreement dated August 25, 1999, which amended
and restated a Registration Rights Agreement dated as of November 17, 1998; and

      WHEREAS, the Founders are holders of shares of the Company's Common Stock
(as defined herein);

      WHEREAS, Acer, FAC, the Series C Investors, the Series D Investors, the
Series E Investors and the Series F Investors are holders of shares of Series A
Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D
Preferred Stock, Series E Preferred Stock and Series F Preferred Stock;



      WHEREAS, Hasbro is the holder of shares of the Company's Common Stock; and

      WHEREAS, it is a condition to the purchase by the Series F Investors of
shares of Series F Preferred Stock that the Prior Agreement be further amended
and restated as provided herein, and the Company, Investors and Stockholders
desire to further amend and restate the Prior Agreement as provided herein;

      NOW THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree that the Prior Agreement is hereby amended and restated in
its entirety as follows:

                                    ARTICLE I

                                   DEFINITIONS

      SECTION 1.1 CONSTRUCTION OF TERMS. As used herein, the masculine, feminine
or neuter gender, and the singular or plural number, shall be deemed to be or to
include the other genders or number, as the case may be, whenever the context so
indicates or requires.

      SECTION 1.2 NUMBER OF SHARES OF STOCK. Whenever any provision of this
Agreement calls for any calculation based on a number of shares of Common Stock
held by a Stockholder or an Investor, the number of shares deemed to be held by
a Stockholder or an Investor shall be the total number of shares of Common Stock
then owned by such Stockholder or Investor, plus the total number of shares of
Common Stock issuable upon conversion of any Preferred Stock or other
convertible securities or exercise of any vested options, warrants or
subscription rights then owned by such Stockholder or Investor.

      SECTION 1.3 DEFINED TERMS. The following capitalized terms, as used in
this Agreement, shall have the meanings set forth below.

      An "AFFILIATE" of any Person means a Person that directly or indirectly,
through one or more intermediaries, controls, is controlled by or is under
common control with the first mentioned Person. A Person shall be deemed to
control another Person if such first Person possesses directly or indirectly the
power to direct, or cause the direction of, the management and policies of the
second Person, whether through the ownership of voting securities, by contract
or otherwise.

      "BOARD OF DIRECTORS" means the Board of Directors of the Company.

      "COMMISSION" means the Securities and Exchange Commission.

      "COMMON STOCK" means the Common Stock, $.01 par value per share, of the
Company and any other common equity securities now or hereafter issued by the
Company, and any other shares of stock issued or issuable with respect thereto
(whether by way of a stock dividend or stock split or in exchange for or in
replacement of or upon conversion of such shares or

                                       2


otherwise in connection with a combination of shares, recapitalization, merger,
consolidation or other corporate reorganization).

      "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended from
time to time, and the rules and regulations promulgated thereunder.

      "PERSON" means an individual, a corporation, an association, a
partnership, a limited liability company, an estate, a trust, and any other
entity or organization, governmental or otherwise.

      "PREFERRED STOCK" means the Series A Preferred Stock, the Series B
Preferred Stock, the Series C Preferred Stock, the Series D Preferred Stock, the
Series E Preferred Stock and/or the Series F Preferred Stock.

      "REGISTRABLE SECURITIES" means (i) any shares of Common Stock held by an
Investor, (ii) any shares of Common Stock subject to acquisition by an Investor
upon conversion of shares of Preferred Stock (it being understood that if an
Investor owns Preferred Stock, the Investor may exercise its registration rights
hereunder by converting the shares to be sold under the relevant registration
statement into Common Stock as of the closing of the relevant offering and shall
not be required to cause such Preferred Stock to be converted to Common Stock
until immediately prior to the occurrence of such closing), (iii) for purposes
of Sections 2.1, 2.3, 2.4, 2.5, 2.7, and 3.1, any shares of Common Stock held by
a Founder and any shares of Common Stock subject to acquisition by a Founder
upon conversion or exercise of securities convertible or exercisable into shares
of Common Stock (it being understood that if a Founder owns such securities, the
Founder may exercise its registration rights hereunder by converting or
exercising the shares to be sold under the relevant registration statement into
Common Stock as of the closing of the relevant offering and shall not be
required to cause such securities to be converted or exercised into Common Stock
until immediately prior to the occurrence of such closing), and (iv) any
securities issued and issuable with respect to any such shares described in
clauses (i), (ii) or (iii) above by way of a stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization; provided, however, that notwithstanding anything to the
contrary contained herein, "Registrable Securities" shall not include at any
time securities (i) that have been sold in a registered sale pursuant to an
effective registration statement under the Securities Act, (ii) that have been
sold to the public pursuant to Rule 144 under the Securities Act, (iii) held by
a holder of less than three percent (3%) of the outstanding capital stock of the
Company which could then be sold in their entirety pursuant to Rule 144 under
the Securities Act without limitation or restriction, except to the extent that
such holder is prevented from selling such shares pursuant to the market
stand-off agreement set forth in Section 2.6.

      "SECURITIES ACT" means the Securities Act of 1933, as amended from time to
time, and the rules and regulations promulgated thereunder.

      "TRANSFER" means any direct or indirect transfer, donation, sale,
assignment, pledge, hypothecation, grant of a security interest in or other
disposal or attempted disposal of all or any

                                       3


portion of a security or of any rights. "Transferred" means the accomplishment
of a Transfer, and "Transferee" means the recipient of a Transfer.

                                   ARTICLE II

                               REGISTRATION RIGHTS

      SECTION 2.1 OPTIONAL REGISTRATIONS. If at any time or times after the date
hereof the Company shall seek to register any shares of its Common Stock under
the Securities Act for sale to the public (except with respect to registration
statements on Form S-4, S-8 or other similar form not available for registering
the Registrable Securities for general sale to the public) for its own account
or for the account of any other Person, including, without limitation, any
registration pursuant to Section 2.2, the Company will promptly give written
notice thereof to all holders of Registrable Securities (the "Holders"). If
within twenty (20) days after their receipt of such notice one or more Holders
request the inclusion of some or all of the Registrable Securities owned by them
in such registration, the Company will use its best efforts to effect the
registration under the Securities Act of such Registrable Securities. In the
case of the registration of shares of capital stock by the Company in connection
with any underwritten public offering, if the underwriter(s) determines that
marketing factors require a limitation on the number of Registrable Securities
to be offered, subject to the following sentence, the Company shall not be
required to register Registrable Securities of the Holders in excess of the
amount, if any, of shares of the capital stock which the principal underwriter
of such underwritten offering shall reasonably and in good faith agree to
include in such offering in addition to any amount to be registered for the
account of the Company and/or such other Person on whose account the Company had
initially sought to register the shares. If any limitation of the number of
shares of Registrable Securities to be registered by the Holders is required
pursuant to this Section 2.1, the number of shares to be excluded shall be
determined in the following order and on the following basis: first, on a pro
rata basis based upon the respective holdings of Registrable Securities by such
Holders who are neither Founders nor Investors; second, on a pro rata basis
based upon the respective holdings of Registrable Securities by such Holders who
are Founders; and third, on a pro rata basis based upon the respective holdings
of Registrable Securities by such Holders who are Investors, provided, however,
that in no event shall the above cutback provision reduce the number of
Registrable Securities included in such registration to a number that is less
than 25% of the total number of shares of capital stock to be included in such
underwritten public offering, including any amount to be registered for the
account of the Company and any Person on whose account the Company had initially
sought to register the shares, except with respect to the Company's initial
public offering of its Common Stock, in which case the number of shares of
Registrable Securities to be included may be reduced to zero (0).

      SECTION 2.2 REQUIRED REGISTRATIONS.

            (a)   DEMAND REGISTRATION.

                  (i) At any time that is at least six (6) months after the
initial underwritten public offering of Common Stock by the Company pursuant to
an effective registration statement under the Securities Act, Fenway Partners
Capital Fund II, L.P. ("Fenway") and/or one or more

                                       4


Series D Investors holding at least 20% of the Registrable Securities originally
issued to Fenway and such Series D Investors and then held by Fenway and/or such
Series D Investors may request that the Company register under the Securities
Act all or a portion of the Series D Preferred Stock held by Fenway and/or such
Series D Investors having an aggregate value (based on the then current market
price) of at least (A) $7,500,000 or (B) if the Series D Preferred Stock for
which such registration is requested represent all of the Series D Preferred
Stock held by Fenway and/or such Series D Investor, $1,000,000. The Company
shall not be obligated to effect, or to take any action to effect, any
registration pursuant to this Section 2.2(a)(i) after the Company has effected
two (2) registrations pursuant to this Section 2.2(a)(i) and such registrations
have been declared or ordered effective.

                  (ii) At any time that is at least six (6) months after the
initial underwritten public offering of Common Stock by the Company pursuant to
an effective registration statement under the Securities Act, Acer and/or one or
more Investors holding at least 50% of those Registrable Securities originally
issued to Acer and then held by Acer and such Investors may request that the
Company register under the Securities Act all or a portion of the Registrable
Securities held by Acer and such requesting Investors having an aggregate value
(based on the then current market price) of at least (A) $7,500,000 or (B) if
the Registrable Securities for which such registration is requested represent
all of the Registrable Securities held by Acer and such Investors, $1,000,000.
The Company shall not be obligated to effect, or to take any action to effect,
any registration pursuant to this Section 2.2(a)(ii) after the Company has
effected two (2) registrations pursuant to this Section 2.2(a)(ii) and such
registrations have been declared or ordered effective.

                  (iii) At any time that is at least six (6) months after the
initial underwritten public offering of Common Stock by the Company pursuant to
an effective registration statement under the Securities Act, Hasbro and/or one
or more Investors holding at least 50% of those Registrable Securities
originally issued to Hasbro and then held by Hasbro and such Investors may
request that the Company register under the Securities Act all or a portion of
the Registrable Securities held by Hasbro and such requesting Investors having
an aggregate value (based on the then current market price) of at least (A)
$7,500,000 or (B) if the Registrable Securities for which such registration is
requested represent all of the Registrable Securities held by Hasbro and such
Investors, $1,000,000. The Company shall not be obligated to effect, or to take
any action to effect, any registration pursuant to this Section 2.2(a)(iii)
after the Company has effected two (2) registrations pursuant to this Section
2.2(a)(iii) and such registrations have been declared or ordered effective.

                  (iv) At any time that is at least six (6) months after the
initial underwritten public offering of Common Stock by the Company pursuant to
an effective registration statement under the Securities Act, FAC and/or one or
more Investors holding at least 50% of those Registrable Securities originally
issued to FAC and then held by FAC and such Investors may request that the
Company register under the Securities Act all or a portion of the Registrable
Securities held by FAC and such requesting Investors having an aggregate value
(based on the then current market price) of at least (A) $7,500,000 or (B) if
the Registrable Securities for which such registration is requested represent
all of the Registrable Securities held by FAC and such Investors, $1,000,000.
The Company shall not be obligated to effect, or to take any action

                                       5


to effect, any registration pursuant to this Section 2.2(a)(iv) after the
Company has effected two (2) registrations pursuant to this Section 2.2(a)(iv)
and such registrations have been declared or ordered effective.

                  (v) At any time that is at least six (6) months after the
initial underwritten public offering of Common Stock by the Company pursuant to
an effective registration statement under the Securities Act, one or more
Investors holding at least 50% of those Registrable Securities originally issued
to the Series C Investors and then held by the Series C Investors and such
Investors may request that the Company register under the Securities Act all or
a portion of the Registrable Securities held by the Series C Investors and such
requesting Investors having an aggregate value (based on the then current market
price) of at least (A) $7,500,000 or (B) if the Registrable Securities for which
such registration is requested represent all of the Registrable Securities held
by such Investors, $1,000,000. The Company shall not be obligated to effect, or
to take any action to effect, any registration pursuant to this Section
2.2(a)(v) after the Company has effected two (2) registrations pursuant to this
Section 2.2(a)(v) and such registrations have been declared or ordered
effective.

                  (vi) At any time that is at least six (6) months after the
initial underwritten public offering of Common Stock by the Company pursuant to
an effective registration statement under the Securities Act, Trident Capital
Fund-V, L.P. and affiliates (collectively, "Trident") and/or one or more Series
E Investors holding at least 20% of the Registrable Securities originally issued
to Trident and such Series E Investors and then held by Trident and/or such
Series E Investors may request that the Company register under the Securities
Act all or a portion of the Registrable Securities held by Trident and/or such
Series E Investors having an aggregate value (based on the then current market
price) of at least (A) $7,500,000 or (B) if the Registrable Securities for which
such registration is requested represent all of the Registrable Securities held
by Trident and/or such Series E Investor, $1,000,000. The Company shall not be
obligated to effect, or to take any action to effect, any registration pursuant
to this Section 2.2(a)(vi) after the Company has effected two (2) registrations
pursuant to this Section 2.2(a)(vi) and such registrations have been declared or
ordered effective.

                  (vii) At any time that is at least six (6) months after the
initial underwritten public offering of Common Stock by the Company pursuant to
an effective registration statement under the Securities Act, Explore Holdings
L.L.C. ("Explore") and/or one or more Series F Investors holding at least 50% of
those Registrable Securities originally issued to Explore and such Series F
Investors and then held by Explore and/or such Series F Investors may request
that the Company register under the Securities Act all or a portion of the
Registrable Securities held by Explore and/or such Series F Investors having an
aggregate value (based on the then current market price) of at least (A)
$7,500,000 or (B) if the Registrable Securities for which such registration is
requested represent all of the Registrable Securities held by Explore and/or
such Series F Investors, $1,000,000. The Company shall not be obligated to
effect, or to take any action to effect, any registration pursuant to this
Section 2.2(a)(vii) after the Company after the Company has effected one (1)
registration pursuant to this Section 2.2(a)(vii) and such registration has been
declared or ordered effective.

                                       6


            (b) FORM S-3. After the Company's initial public offering of Common
Stock registered under the Securities Act, the Company shall use its best
efforts to qualify and remain qualified to register securities on Form S-3 (or
any successor form) under the Securities Act. In addition to the rights set
forth in Section 2.2(a), so long as the Company is qualified to register
securities on Form S-3 (or any successor form), any Investor or Investors shall
have the right to request registration on Form S-3 (or any successor form) for
the Registrable Securities held by such requesting Investor having an aggregate
value of at least $500,000 (based on the then current market price), including
registrations for the sale of such Registrable Securities on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act. Such requests
shall be in writing and shall state the number of shares of Registrable
Securities to be disposed of and the intended method of disposition of such
shares by such Investor or Investors. Registrations effected pursuant to this
Section 2.2(b) shall not be counted as demands for registration or registrations
effected pursuant to Section 2.2(a). The Company shall not be obligated to
effect, or to take any action to effect, any registration pursuant to this
Section 2.2(b) (i) for any Investor if the Company has effected two (2)
registrations initiated at the request of such Investor pursuant to this Section
2.2(b) and such registrations have been declared or ordered effective or (ii) if
the Company has, within the twelve (12) month period preceding the date of such
request, already effected four (4) registrations for any Investors pursuant to
this Section 2.2(b) and such registrations have been declared or ordered
effective.

            (c) REGISTRATION REQUIREMENTS. Following a request pursuant to
Section 2.2(a) or (b) above, the Company will promptly notify all of the Holders
who would be entitled to notice of a proposed registration under Section 2.1
above and any other holder of piggyback registration rights of its receipt of
such notification from such Investor or Investors. Upon the written request of
any such Holder or other holder of the Company's securities delivered to the
Company within twenty (20) days after receipt from the Company of such
notification, the Company will use its best efforts to cause such of the
Registrable Securities as may be requested by any Holders and any other holder
of piggyback registration rights to be registered under the Securities Act in
accordance with the terms of Section 2.1. If the request for registration
contemplates an underwritten public offering, the Company shall state such in
the written notice and in such event the right of any Person to participate in
such registration shall be conditioned upon their participation in such
underwritten public offering and the inclusion of their securities in the
underwritten public offering to the extent provided herein. If the Company fails
to register all shares for which registration has been properly requested
pursuant to Section 2.2(a) or 2.2(b), other than because the number of such
shares, plus the number of shares required to be allocated to the exercise of
piggy-back rights in respect of Registrable Securities pursuant to Section 2.1,
exceeds the number of Registrable Securities which the underwriter thereof
determines can be sold in light of then applicable marketing factors, then
except as otherwise provided in this Agreement such registration shall not be
considered a request pursuant to Section 2.2(a) or 2.2(b).

            (d) UNDERWRITTEN OFFERING. If a requested registration pursuant to
Section 2.2 hereof involves an underwritten public offering and the managing
underwriter of such offering determines in good faith that the number of
securities sought to be offered should be limited due to market conditions, then
the number of securities to be included in such underwritten public offering
shall be reduced to a number deemed satisfactory by such managing

                                       7


underwriter, provided that the shares to be excluded shall be determined in the
following sequence: (i) first, securities held by any Persons other than the
Founders and the Investors, (ii) second, securities held by any Founders, (iii)
third, shares sought to be registered by the Company and (iv) fourth,
Registrable Securities of Investors requesting such registration (whether
pursuant to Section 2.1 or this Section 2.2). If there is a reduction of the
number of Registrable Securities to be included in the registration pursuant to
clause (i), (ii) or (iv), the reduction shall be effected among the holders
covered by such respective clause (i), (ii) or (iv) (as the case may be) on a
pro rata basis (based upon the respective number of shares of Registrable
Securities and other securities entitled to registration held by such holders).
Any Investor who sells more than fifty percent (50%) of the Registrable
Securities then held by such Investor pursuant to any registration requested
under Section 2.2(a) shall be deemed to have exercised one of the demand
registration rights granted to such Investor pursuant to Section 2.2(a),
regardless of whether such Investor requested such registration pursuant to
Section 2.2(a). With respect to a request for registration pursuant to Section
2.2(a) or (b) which is for an underwritten public offering, the managing
underwriter shall be chosen by the Investors requesting such registration,
subject to the Company's approval which shall not be unreasonably withheld.

            (e) POSTPONEMENT. The Company may postpone the filing of any
registration statement required hereunder for a reasonable period of time, not
to exceed ninety (90) days in the aggregate during any twelve-month period, if
the Company has been advised by legal counsel that such filing would require a
special audit or the disclosure of a material impending transaction or other
matter and the Company's Board of Directors determines reasonably and in good
faith that such disclosure would have a material adverse effect on the Company.
The Company shall not be required to cause a registration statement requested
pursuant to this Section 2.2 to become effective prior to ninety (90) days
following the effective date of a registration statement initiated by the
Company (or one hundred eighty (180) days in the case of the Company's initial
public offering of its Common Stock), if the request for registration has been
received by the Company subsequent to the giving of written notice by the
Company, made in good faith, to the Investors that the Company is commencing to
prepare a Company-initiated registration statement (other than a registration
effected solely to implement an employee benefit plan or a transaction to which
Rule 145 or any other similar rule under the Securities Act is applicable);
provided, however, that the Company shall use its best efforts to achieve such
effectiveness promptly following such period. Notwithstanding anything in this
Agreement to the contrary, the Company shall not be obligated to effect more
than one registration pursuant to Section 2.2(a) in any six-month period.

      SECTION 2.3 FURTHER OBLIGATIONS OF THE COMPANY. Whenever the Company is
required hereunder to register any Registrable Securities, it agrees that it
shall also do the following:

            (a) Pay all expenses of such registrations and offerings (exclusive
of underwriting discounts and commissions) and the reasonable fees and expenses
of not more than one independent counsel for the Holders in connection with any
registrations pursuant to Section 2.1 or 2.2, any such counsel to be selected by
the Investor requesting registration under Section 2.2 (if any) and otherwise to
be selected by a majority of the Holders selling in such registration;

                                       8


            (b) Use its best efforts diligently to prepare and file with the
Commission, within sixty (60) days of request, a registration statement and such
amendments and supplements to said registration statement and the prospectus
used in connection therewith as may be necessary to keep said registration
statement effective until the earlier of the sale of all Registrable Securities
covered thereby and one hundred twenty (120) days, and to comply with the
provisions of the Securities Act with respect to the sale of securities covered
by said registration statement for such period;

            (c) Furnish to each selling Holder such copies of each preliminary
and final prospectus and such other documents as such Holder may reasonably
request to facilitate the public offering of its Registrable Securities;

            (d) In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the underwriter(s) of such offering; each Holder participating in
such underwriting shall also enter into and perform its obligations under such
an agreement;

            (e) Use its best efforts to register or qualify the securities
covered by said registration statement under the securities or "blue sky" laws
of such jurisdictions as any selling Holder may reasonably request; provided,
that the Company shall not be required to register or qualify the securities in
any jurisdictions in which such registration or qualification would require it
to qualify to do business or consent to general service of process therein;

            (f) Immediately notify each selling Holder, at any time when a
prospectus relating to his, her or its Registrable Securities is required to be
delivered under the Securities Act, of the happening of any event as a result of
which such prospectus contains an untrue statement of a material fact or omits
any material fact necessary to make the statements therein not misleading, and,
at the request of any such selling Holder, prepare a supplement or amendment to
such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain any untrue statement of
a material fact or omit to state any material fact necessary to make the
statements therein not misleading;

            (g) Cause all such Registrable Securities to be listed on each
securities exchange or quotation system on which similar securities issued by
the Company are then listed or quoted;

            (h) Otherwise use its best efforts to comply with the securities
laws of the United States and other applicable jurisdictions and all applicable
rules and regulations of the Commission and comparable governmental agencies in
other applicable jurisdictions;

            (i) If the offering is underwritten, use its best efforts to obtain
and furnish to each selling Holder, immediately prior to the effectiveness of
the registration statement and, at the time of delivery of any Registrable
Securities sold pursuant thereto, a cold comfort letter from the Company's
independent public accountants in customary form and covering such matters of
the type customarily covered by cold comfort letters as any Investor requesting

                                       9


registration under Section 2.2 or the Holders of a majority of the Registrable
Securities being sold may reasonably request;

            (j) Otherwise cooperate with the underwriter or underwriters, the
Commission and other regulatory agencies and take all actions and execute and
deliver or cause to be executed and delivered all documents necessary to effect
the registration of any Registrable Securities under this Article II; and

            (k) Use its best efforts to obtain and furnish to each selling
Holder such legal opinions, if any, of counsel to the Company, addressed to each
selling Holder, as are usual and customary under the circumstances.

      SECTION 2.4 INDEMNIFICATION; CONTRIBUTION.

            (a) Incident to any registration statement referred to in this
Article II, the Company will indemnify and hold harmless each underwriter, each
Holder who offers or sells any such Registrable Securities in connection with
such registration statement (including its partners (including partners of
partners and stockholders of any such partners), and directors, officers,
employees and agents of any of them (a "Selling Holder"), and each person who
controls any of them within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (a "Controlling Person")), from and against any
and all losses, claims, damages, expenses and liabilities, joint or several
(including any reasonable investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted, as the same are incurred), to which they, or
any of them, may become subject under the Securities Act, the Exchange Act or
other federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities arise out of or are based
on (i) any untrue statement or alleged untrue statement of a material fact
contained in such registration statement (including any related preliminary or
definitive prospectus, or any amendment or supplement to such registration
statement or prospectus), (ii) any omission or alleged omission to state in such
document a material fact required to be stated in it or necessary to make the
statements in it not misleading in light of the circumstances under which such
statements were made, or (iii) any violation by the Company of the Securities
Act, any state securities or "blue sky" laws or any rule or regulation
thereunder in connection with such registration; provided, however, that the
Company will not be obligated to indemnify any party to the extent that such
loss, claim, damage, expense or liability arises from and is based on an untrue
statement or omission or alleged untrue statement or omission made in reliance
on and in conformity with information furnished in writing to the Company by or
on behalf of such party expressly for use in such registration statement.

            (b) Each Selling Holder will indemnify and hold harmless the Company
(including its directors, officers, employees and agents), each underwriter and
each other Holder (including its partners (including partners of partners and
stockholders of such partners), and directors, officers, employees and agents of
any of them, and each person who controls any of them within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act), from and
against any and all losses, claims, damages, expenses and liabilities, joint or
several (including any reasonable investigation, legal and other expenses
incurred in connection with,

                                       10


and any amount paid in settlement of, any action, suit or proceeding or any
claim asserted, as the same are incurred), to which they, or any of them, may
become subject under the Securities Act, the Exchange Act or other federal or
state statutory law or regulation, at common law or otherwise with respect to
any untrue statement or alleged untrue statement of a material fact contained in
information furnished in writing to the Company by such Selling Holder expressly
for use in such registration statement or any omission or alleged omission to
state in such information a material fact required to be stated in it or
necessary to make the statements in it not misleading in light of the
circumstances under which such statements were made. In no event, however, shall
the liability of a Selling Holder for indemnification under this Section 2.4(b)
exceed the net proceeds received by such Selling Holder from its sale of
Registrable Securities under such registration statement.

            (c) If the indemnification provided for in Section 2.4(a) or (b)
above for any reason is held by a court of competent jurisdiction to be
unavailable to an indemnified party in respect of any losses, claims, damages,
expenses or liabilities referred to therein, then each indemnifying party under
this Section 2.4, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, expenses or liabilities in such
proportion as is appropriate to reflect (i) the relative benefits received by
the Company, the other Selling Holders and the underwriters from the offering of
the Registrable Securities, (ii) the relative fault of the Company, the other
Selling Holders and the underwriters in connection with the statements or
omissions which resulted in such losses, claims, damages, expenses or
liabilities, and (iii) any other relevant equitable considerations. The relative
benefits received by the Company, the Selling Holders and the underwriters shall
be deemed to be in the same respective proportions that the net proceeds from
the offering (before deducting expenses) received by the Company and the Selling
Holders and the underwriting discount received by the underwriters, in each case
as set forth in the table on the cover page of the applicable prospectus, bear
to the aggregate public offering price of the Registrable Securities. The
relative fault of the Company, the Selling Holders and the underwriters shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company, the Selling
Holders or the underwriters and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.

            The Company, the Selling Holders, and the underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 2.4(c)
were determined by pro rata or per capita allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to in the immediately preceding paragraph. In no event, however, shall a Selling
Holder be required to contribute any amount under this Section 2.4(c) in excess
of the net proceeds received by such Selling Holder from its sale of Registrable
Securities under such registration statement. No person found guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
found guilty of such fraudulent misrepresentation.

            (d) The amount paid by an indemnifying party or payable to an
indemnified party as a result of the losses, claims, damages and liabilities
referred to in this Section 2.4 shall

                                       11


be deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim, payable as the same are
incurred. The indemnification obligations set forth in this Section 2.4 shall
not apply to amounts paid by the indemnified party in any settlement that is
effected without the consent of the party from whom indemnification sought,
which consent shall not be unreasonably withheld. The indemnification and
contribution provided for in this Section 2.4 will remain in full force and
effect regardless of any investigation made by or on behalf of the indemnified
parties or any officer, director, employee, agent or controlling person of the
indemnified parties. No indemnifying party, in the defense of any such claim or
litigation, shall, except with the consent of such indemnified party, which
consent shall not be unreasonably withheld, consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such indemnified party of a
release from all liability in respect of such claim or litigation.

            (e) Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in an underwriting agreement
entered into in connection with an underwritten public offering are in conflict
with the provisions of this Agreement, the provisions in such underwriting
agreement shall control.

      SECTION 2.5 RULE 144 AND RULE 144A REQUIREMENTS. With a view to making
available to the Holders the benefits of Rule 144 promulgated under the Act and
any other rule or regulation of the Commission that may at any time permit a
Holder to sell securities of the Company to the public without registration or
pursuant to a registration on Form S-3, the Company agrees to use its best
efforts to:

            (a) make and keep public information available, as those terms are
understood and defined in Commission Rule 144, at all times after ninety (90)
days after the effective date of the first registration statement filed by the
Company for the offering of its securities to the general public;

            (b) take such action, including the voluntary registration of its
Common Stock under Section 12 of the Exchange Act, as is necessary to enable the
Holders to utilize Form S-3 for the sale of their Registrable Securities, such
action to be taken as soon as practicable after the end of the fiscal year in
which the first registration statement filed by the Company for the offering of
its securities to the general public is declared effective;

            (c) file with the Commission in a timely manner all reports and
other documents required of the Company under the Act and the Exchange Act; and

            (d) furnish to any Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by the
Company that it has complied with the reporting requirements of Commission Rule
144 (at any time after ninety (90) days after the effective date of the first
registration statement filed by the Company), the Act and the Exchange Act (at
any time after it has become subject to such reporting requirements), or that it
qualifies as a registrant whose securities may be resold pursuant to Form S-3
(at any time after it so qualifies), (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed by
the Company, and (iii) such other information as may be

                                       12


reasonably requested in availing any Holder of any rule or regulation of the
Commission which permits the selling of any such securities without registration
or pursuant to such form.

      SECTION 2.6 "MARKET STAND-OFF" AGREEMENT. In connection with any
underwritten public offering of the Company's Common Stock, the Investors and
the Stockholders (including any Transferee) if requested in good faith by the
Company and the managing underwriter of the Company's securities, shall agree
not to, directly or indirectly, offer, sell, pledge, contract to sell (including
any short sale), grant any option to purchase or otherwise dispose of any
securities of the Company held by them (except for any securities sold pursuant
to such registration statement) or enter into any Hedging Transaction (as
defined below) relating to any securities of the Company for a period not to
exceed one hundred eighty (180) days (in the case of the Company's initial
underwritten public offering) or ninety (90) days (in the case of any
underwritten public offering other than the Company's initial underwritten
public offering) following the effective date of the applicable registration
statement as agreed to by such parties; provided, that the Investors'
obligations under this Section 2.6 shall be conditioned upon (a) all officers
and directors of the Company entering into similar agreements with the Company
and such managing underwriter and (b) the Company using all reasonable effort to
obtain similar agreements from all holders of one percent (1%) or more of the
outstanding capital stock of the Company; and provided, further, that such
periods may be extended for up to an additional twenty (20) days to permit the
underwriters to issue a research report in compliance with the National
Association of Security Dealers Rule 2711(f)(4). For purposes of this Section
2.6, "Hedging Transaction" means any short sale (whether or not against the box)
or any purchase, sale or grant of any right (including without limitation, any
put or call option) with respect to any security (other than a broad-based
market basket or index) that includes, relates to or derives any significant
part of its value from the Company's Common Stock.

      SECTION 2.7 TRANSFERABILITY OF REGISTRATION RIGHTS. The registration
rights set forth in this Agreement are transferable (i) to each Transferee of
Registrable Securities who receives at least one hundred thirty five thousand
(135,000) shares of Registrable Securities, provided, that such transferee's
activities, products and services are not competitive in any material respect
with activities, products or services of the Company as reasonably determined by
the Board of Directors or (ii) to any partner, member or employee of such Holder
or a general partner or managing member of such Holder or an Affiliate of such
Holder. Each subsequent holder of Registrable Securities must consent in writing
to be bound by the terms and conditions of this Agreement and written notice of
any such transfer must be given to the Company in order for such Holder to
acquire the rights granted pursuant to this Agreement and, in such event, each
such subsequent Holder who is a transferee of an Investor shall be deemed an
Investor for all purposes of this Agreement.

                                   ARTICLE III

                                     GENERAL

      SECTION 3.1 AMENDMENTS, WAIVERS AND CONSENTS. For the purposes of this
Agreement, no course of dealing between or among any of the parties hereto and
no delay on the part of any party hereto in exercising any rights hereunder or
thereunder shall operate as a waiver

                                       13


of the rights hereof and thereof. The following shall be sufficient to effect
any amendment, waiver or modification of this Agreement: the written consent of
Investors holding a majority of the Registrable Securities then held by all
Investors, the Company and Stockholders holding at least a majority of the
outstanding shares of Registrable Securities then held by the Stockholders;
provided, that any party may waive any provision hereof with respect to such
party intended for its benefit by written consent; provided, further, that the
provisions contained in Article II may be amended, modified or waived only with
the added consent of the holders of not less than a majority of the Registrable
Securities then outstanding , provided, however, that any such amendment,
modification or waiver that disproportionately (other than as a result of
disproportionate stockholdings) and adversely affects any Investor or
Stockholder shall require the prior written consent of such Investor or
Stockholder, it being understood and agreed that the grant of registration
rights to third parties shall not be deemed to disproportionately or adversely
affect any particular Investor or Stockholder; and provided, further, that the
provisions of Section 2.1 may be amended modified or waived only with the added
consent of those Founders holding a majority of Registrable Securities then held
by the Founders; and provided still further, that the provisions of this Section
3.1 may be amended, modified or waived only with the consent of (i) holders of
not less than a majority of the Registrable Securities then outstanding which
were initially held by Hasbro, (ii) holders of not less than a majority of the
Registrable Securities then outstanding which were initially held by Acer, (iii)
holders of not less than a majority of the Registrable Securities then
outstanding which were initially held by FAC, (iv) holders of not less than a
majority of the Registrable Securities then outstanding which were initially
held by the Series C Investors, (v) holders of not less than a majority of the
Registrable Securities then outstanding which were initially held by the Series
D Investors, (vi) holders of not less than a majority of the Registrable
Securities then outstanding which were initially held by the Series E Investors,
(vii) holders of not less than a majority of the Registrable Securities then
outstanding which were initially held by the Series F Investors, (viii) the
Company and (ix) Stockholders holding at least a majority of the outstanding
shares of Registrable Securities then held by all Stockholders. Notwithstanding
anything in this Agreement to the contrary, the Company shall amend (which
amendments shall not require the consents of the holders of Registrable
Securities or any particular Investor or Stockholder in accordance with this
Section 3.1) Schedule I hereto to include each additional holder of Series F
Preferred Stock executing a Counterpart Signature Page, any Additional
Stockholder or to reflect any permitted transfer pursuant to Section 2.7.

      SECTION 3.2 LEGEND ON SECURITIES. The Company, each of the Investors and
each of the Stockholders acknowledge and agree that substantially the following
legend shall be typed on each certificate evidencing any of the securities
issued hereunder held at any time by an Investor or a Stockholders:

                                       14


      THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933 (THE "ACT"), OR ANY STATE SECURITIES OR BLUE SKY
      LAWS AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, MORTGAGED, PLEDGED,
      HYPOTHECATED OR OTHERWISE ASSIGNED EXCEPT (1) PURSUANT TO A REGISTRATION
      STATEMENT WITH RESPECT TO SUCH SECURITIES WHICH IS EFFECTIVE UNDER THE ACT
      OR (2) PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE ACT
      RELATING TO THE DISPOSITION OF SECURITIES AND (3) IN ACCORDANCE WITH
      APPLICABLE STATE SECURITIES AND BLUE SKY LAWS.

      SECTION 3.3 GOVERNING LAW. This Agreement shall be deemed to be a contract
made under, and shall be construed in accordance with, the laws of The
Commonwealth of Massachusetts, without giving effect to conflict of laws
principles thereof.

      SECTION 3.4 SECTION HEADINGS. The descriptive headings in this Agreement
have been inserted for convenience only and shall not be deemed to limit or
otherwise affect the construction of any provision thereof or hereof.

      SECTION 3.5 COUNTERPARTS. This Agreement may be executed simultaneously in
any number of counterparts, each of which when so executed and delivered shall
be taken to be an original; but such counterparts shall together constitute but
one and the same document.

      SECTION 3.6 NOTICES AND DEMANDS. Any notice or demand which is required or
provided to be given under this Agreement shall be deemed to have been
sufficiently given and received for all purposes when delivered by hand, or
facsimile, or five days after being sent by certified or registered mail,
postage and charges prepaid, return receipt requested, or two days after being
sent by overnight delivery providing receipt of delivery, to the following
addresses: if to the Company or the Founders, at the addresses set forth on the
signature pages hereto, or at any other address designated by the Company or the
Founders, respectively, to the Investors and the other parties hereto in
writing; if to the Investors, at the mailing address as shown on the signature
page hereto, or at any other address designated by an Investor to the Company in
writing; and if to any other the Stockholders, at the mailing address for notice
as set forth in the books and records of the Company.

      SECTION 3.7 REMEDIES; SEVERABILITY. It is specifically understood and
agreed that any breach of the provisions of this Agreement by any Person subject
hereto will result in irreparable injury to the other parties hereto, that the
remedy at law alone will be an inadequate remedy for such breach, and that, in
addition to any other remedies which they may have, such other parties may
enforce their respective rights by actions for specific performance (to the
extent permitted by law). Whenever possible, each provision of this Agreement
shall be interpreted in such a manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be deemed
prohibited or invalid under such applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, and such
prohibition or invalidity shall not invalidate the remainder of such provision
or the other provisions of this Agreement.

                                       15


      SECTION 3.8 INTEGRATION. This Agreement, including the exhibits, documents
and instruments referred to herein or therein, constitutes the entire agreement,
and supersedes all other prior agreements and understandings, both written and
oral, among the parties with respect to the subject matter hereof. Without
limiting the foregoing, this Fifth Amended and Restated Registration Rights
Agreement amends and supersedes the Prior Agreement in its entirety.

      SECTION 3.9 ADJUSTMENT. All references to share amounts and prices herein
shall be equitably adjusted to reflect any stock split, combination,
reorganization, recapitalization, reclassification, stock distribution, stock
dividend or similar event affecting the capital stock of the Company.

                            [SIGNATURE PAGE FOLLOWS]

                                       16


      IN WITNESS WHEREOF, the parties have executed this Fifth Amended and
Restated Registration Rights Agreement as of the date first above written.

                              COMPANY:

                              IROBOT CORPORATION

                              By: /s/ Helen Greiner
                                 ---------------------------------------
                                 Helen Greiner, President
                                 63 South Ave.
                                 Burlington, Massachusetts 01803-4903

                              FOUNDERS:

                              /s/ Rodney Brooks
                              -----------------------------------------
                              Rodney Brooks
                              31 Hillside Road
                              Lincoln, MA 01773

                              /s/ Colin M. Angle
                              -----------------------------------------
                              Colin M. Angle
                              41 Russell Street
                              Somerville, MA 02144

                              /s/ Helen Greiner
                              -----------------------------------------
                              Helen Greiner
                              11 Gage Road
                              Wayland, MA 01778

                              /s/ M. David Adler
                              -----------------------------------------
                              M. David Adler
                              33 Dunbar Street
                              Sharon, MA 02067

                              /s/ Grinnell More
                              -----------------------------------------
                              Grinnell More
                              672 Old Revolutionary Road
                              Temple, NH 03804



                              INVESTORS:

                              EXPLORE HOLDINGS L.L.C

                              By: /s/ Elizabeth Korrell
                                 ---------------------------------------
                                 Elizabeth Korrell
                                 Manager

                              TRIDENT CAPITAL FUND-V, L.P.

                              TRIDENT CAPITAL FUND-V AFFILIATES FUND, L.P.

                              TRIDENT CAPITAL FUND-V AFFILIATES FUND (Q), L.P.

                              TRIDENT CAPITAL FUND-V PRINCIPALS FUND, L.P.

                              TRIDENT CAPITAL PARALLEL FUND-V, C.V.

                              Executed on behalf of the foregoing funds by the
                              undersigned, as an authorized signatory of the
                              respective general partner of each such fund:


                              /s/ Peter Meekin
                              -------------------------------------------
                                      (signature)

                              Peter Meekin
                              -------------------------------------------
                                      (print name)

                              FENWAY PARTNERS CAPITAL FUND II, L.P.
                              FPIP TRUST, LLC
                              FPIP, LLC

                              By: Fenway Partners II, LLC, its general partner

                              By: /s/ [Illegible]
                                 ---------------------------------------
                                 Name:
                                 Title: Managing Director

                              By: /s/ [Illegible]
                                 ---------------------------------------
                                 Name:
                                 Title: Managing Director



                              ROBOTIC VENTURES FUND I, L.P.

                              By:
                                 -----------------------------------------
                                 Name: Brian Friedman
                                 Title: Managing Director

                              HASBRO, INC.

                              By: /s/ David D.R. Hargreaves
                                 -----------------------------------------
                                 Name:  David D.R. Hargreaves
                                 Title: C.F.O.

                              ACER TECHNOLOGY VENTURE FUND L.P.

                              By: Acer Technology Ventures
                                  Management LLC, its General Partner

                              By: /s/ James C. Lu
                                 -----------------------------------------
                              Name:  James C. Lu
                              Title: Managing Director

                              IP FUND ONE, L.P.

                              By: Acer Technology Ventures America LLC,
                                  its General Partner

                              By: [illegible]
                                 -----------------------------------------
                                 Name:
                                 Title:

                              FIRST ALBANY COMPANIES, INC.

                              By: /s/ George McNamee
                                 -----------------------------------------
                                 George McNamee, Chairman



                              FIRST ALBANY PRIVATE FUND 1999 L.L.C.

                              By: FAC Management Corp., as Managing Member

                              By: /s/ Stephen P. Wink
                                 --------------------------------------
                                 Name:  Stephen P. Wink
                                 Title: VP

                              FIRST ALBANY TECHNOLOGY VENTURES

                              By: FAC Management Corp., as Managing Member

                              By:
                                 --------------------------------------
                                 Name:
                                 Title:

                              FA TECHNOLOGY VENTURES, L.P

                              By: FATV GP LLC, its General Partner

                              By: /s/ George McNamee
                                 ---------------------------------------
                                  Name:  George McNamee
                                  Manager

                              FA TECHNOLOGY MANAGERS LLC

                              By: FATV GP LLC, its Managing Member

                              By: /s/ George McNamee
                                 ---------------------------------------
                                  Name:  George McNamee
                                  Manager

                              FIRST ALBANY PRIVATE FUND 2004, LLC

                              By: FAC Management Corp., its Manager

                              By: /s/ Stephen P. Wink
                                 ---------------------------------------
                                  Name:  Stephen P. Wink
                                  Title: VP



                              _________________________________________
                              Dan Kilmurray

                              ROBINSON CAPITAL, LLC

                              By:_________________________________________
                                 Ben Wegbreit, as Managing Member

                              /s/ David Sonenberg
                              _________________________________________
                              David Sonenberg

                              /s/ Lindalee A. Lawrence
                              _________________________________________
                              Lindalee A. Lawrence

                              /s/ William Contente
                              _________________________________________
                              William Contente

                              PAINTER HILL VENTURE FUND I, L.P.

                              By: /s/ Walter Fiederowicz
                                 _________________________________________
                                 Name: Walter Fiederowicz
                                 Title:

                              PAINTER HILL PARTNERS, LLC

                              By: /s/ Walter Fiederowicz
                                 _________________________________________
                                 Name: Walter Fiederowicz
                                 Title:

                              /s/ Michael F. Cronin
                              _________________________________________
                              Michael F. Cronin

                              /s/ Harold C. Smith
                              _________________________________________
                              Harold C. Smith


                              /s/ Rosario S. Ilacqua
                              _________________________________________
                              Rosario S. Ilacqua

                              /s/ Vincent DellaVolpe
                              _________________________________________
                              Vincent DellaVolpe

                              /s/ Alan Goldberg
                              _________________________________________
                              Alan Goldberg

                              /s/ Giles W. McNamee
                              _________________________________________
                              Giles W. McNamee

                              FAC AS CUSTODIAN MCNAMEE GEORGE
                              FBO GEORGE MCNAMEE MCNAMEE KEOUGH PROFIT
                              SHARING

                              By:_________________________________________
                                 Name:
                                 Title:

                              /s/ Richard Feldman
                              _________________________________________
                              Richard Feldman

                              /s/ Timothy R. Welles
                              _________________________________________
                              Timothy R. Welles

                              /s/ Walter M. Fiederowicz
                              _________________________________________
                              Walter M. Fiederowicz

                              /s/ George C. McNamee
                              _________________________________________
                              George C. McNamee

                              /s/ Hugh Johnson
                              _________________________________________
                              Hugh Johnson



                              /s/ Robert F. Campbell
                              -----------------------------------------
                              Robert F. Campbell

                              /s/ Beno Sternlicht
                              -----------------------------------------
                              Beno Sternlicht

                              /s/ Kenneth A. Mabbs
                              -----------------------------------------
                              Kenneth A. Mabbs

                              /s/ Stephen P. Wink
                              -----------------------------------------
                              Stephen P. Wink

                              /s/ Ullas Naik
                              -----------------------------------------
                              Ullas Naik

                              /s/ Michael R. Lindburg
                              -----------------------------------------
                              Michael R. Lindburg

                              /s/ Charles Schwager
                              -----------------------------------------
                              Charles Schwager

                              FBF, LLLP

                              By: /s/ Laura P. Barton
                                 --------------------------------------
                                 Name: Laura P. Barton
                                 Title: Managing General Partner

                              /s/ Arthur T. Murphy
                              -----------------------------------------
                              Arthur T. Murphy

                              /s/ Steven R. Jenkins
                              -----------------------------------------
                              Steven R. Jenkins

                              /s/ Brian Fernandez
                              -----------------------------------------
                              Brian Fernandez



                              BOECKH CAPITAL CO. LTD.

                              By: /s/ William S. Power
                                 _________________________________________
                                 Name: William S. Power
                                 Title: Vice President, CFO

                              /s/ Frank Ingari
                              _________________________________________
                              Frank Ingari



                                    EXHIBIT A

                               IROBOT CORPORATION
            FIFTH AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT

                           Counterpart Signature Page

      Reference is hereby made to that certain Fifth Amended and Restated
Registration Rights Agreement dated as of November 10, 2004 (the "Registration
Rights Agreement"), by and among IROBOT CORPORATION, a Delaware corporation (the
"Company"), the Stockholders referenced therein and the Investors referenced
therein. Capitalized terms used as defined terms herein and not otherwise
defined shall have the meanings ascribed to such terms in the Registration
Rights Agreement.

      The undersigned is purchasing ___________ (________) shares of the Series
F Preferred Stock of the Company pursuant to a separate purchase agreement
between the Company and the undersigned. By execution of this Counterpart
Signature Page to the Registration Rights Agreement, the undersigned hereby (i)
acknowledges receipt of a copy of the Registration Rights Agreement, (ii) agrees
to be bound by and obtain the benefit of the rights and restrictions of the
Registration Rights Agreement as an Investor party thereto.

      The Company agrees that the undersigned shall be an "Investor" for all
purposes under the Registration Rights Agreement.

      IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as an instrument under seal:

PURCHASER
(For Individual Investor)                  (For Investor Entities)

___________________________________        ______________________________
(Signature)                                (Print Name of Company)

______________________________             By:______________________________
(Print Name)                               (Signature)

                                           Name:____________________________

                                           Title:_____________________________
Accepted:

IROBOT CORPORATION

By:___________________________________
Name:
Title:


                                    EXHIBIT B

                            Form of Joinder Agreement

      The undersigned hereby agrees, effective as of the date hereof, to become
a party to that certain Fifth Amended and Restated Registration Rights Agreement
(the "Agreement") dated as of November ____, 2004 by and among iRobot
Corporation (the "Company") and the other parties named therein and for all
purposes of the Agreement, the undersigned shall be included within the term
Stockholder (each as defined in the Agreement). The address and facsimile number
to which notices may be sent to the undersigned is as follows:

________________________________________________________________________________

Facsimile No.____________________.

                                                  _____________________________
                                                  Name:

Accepted:

IROBOT CORPORATION

By:_______________________________
Name:
Title:

                                                                    EXHIBIT 10.4

AMENDED AND RESTATED
                               1994 STOCK PLAN OF

                               IROBOT CORPORATION

SECTION 1. ESTABLISHMENT AND PURPOSE.

      The purpose of this Plan is to amend and restate in its entirety the 1994
Stock Option Plan of the Company. The Plan is designed to offer selected
employees, directors and consultants an opportunity to acquire a proprietary
interest in the success of the Company, or to increase such interest, by
purchasing Shares of the Company's Common Stock. The Plan provides both for the.
direct award or sale of Shares and for the grant of Options to purchase Shares
Options granted under the Plan may include Nonstatutory options as well as ISOs
intended to qualify under section 422 of the Code.

SECTION 2. DEFINITIONS.

      (a) "Board of Directors" shall mean the Board of Directors of the Company,
as constituted from time to time.

      (b) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.

      (c) "Committee" shall mean a committee of the Board of Directors, as
described in Section 3(a).

      (d) "Company" shall mean iRobot Corporation, a Delaware corporation.

      (e) "Employee" shall mean (i) any employee of the Company or of a
Subsidiary as determined in accordance with the provisions of Treasury
Regulation Section 1 421-7(h) under the Code or any successor regulations
thereto, (ii) a member of the Board of Directors, (iii) an independent
contractor who performs services for the Company or a Subsidiary, and (iv) any
individual who is employed by any partnership in which the Company has a
substantial partnership interest Service as a member of the Board of Directors
or as an independent contractor shall be considered employment for all purposes
of the Plan except the second sentence of Section 4(a).



      (f) "Exercise Price" shall mean the amount for which one Share may be
purchased upon exercise of an Option, as specified by the Committee in the
applicable Stock Option Agreement.

      (g) "Fair Market Value" shall mean the fair market value of a Share, as
determined by the Committee in good faith Such determination shall be conclusive
and binding on all persons.

      (h) "ISO" shall mean an employee incentive stock option described in
section 422(b) of the Code.

      (i) "Nonstatutory Option" shall mean an employee stock option not
described in section 422(b) or section 423(b) of the Code.

      (j) "Offeree" shall mean an individual to whom the Committee has offered
the right to acquire Shares under the Plan (other than upon exercise of an
Option).

      (k) "Option" shall mean an ISO or Nonstatutory Option granted under the
Plan and entitling the holder to purchase Shares.

      (l) "Optionee" shall mean an individual who holds an Option.

      (m) "Plan" shall mean this Amended and Restated 1994 Stock Plan of iRobot
Corporation.

      (n) "Purchase Price" shall mean the consideration for which one Share may
be acquired under the Plan (other than upon exercise of an Option), as specified
by the Committee.

      (o) "Service" shall mean service as an Employee.

      (p) "Share" shall mean one share of Stock, as adjusted in accordance with
Section 9 (if applicable).

      (q) "Stock" shall mean the Common Stock of the Company.

      (r) "Stock Option Agreement" shall mean the agreement between the Company
and an Optionee which contains the terms, conditions and restrictions pertaining
to his Option.

      (s) "Stock Purchase Agreement" shall mean the agreement between the
Company and an Offeree who acquires Shares under the Plan which contains the
terms, conditions and restrictions pertaining to the acquisition of such Shares.

                                      -2-


      (t)   "Subsidiary" shall mean any corporation, if the Company and/or one
or more other Subsidiaries own not less than 50 percent of the total combined
voting power of all classes of outstanding stock of such corporation. A
corporation that attains the status of a Subsidiary on a date after the adoption
of the Plan shall be considered a Subsidiary commencing as of such date.

      (u)   "Total and Permanent Disability" shall mean that the Optionee is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted, or can be expected to last, for a continuous period
of not less than six months.

SECTION 3. ADMINISTRATION.

      (a)   Committee Membership. The Plan shall be administered by the
Committee, which shall consist of three members of the Board of Directors The
members of the Committee shall be appointed by the Board of Directors If no
Committee has been appointed, the entire Board of Directors shall constitute
the Committee.

      (b)   Committee Procedures. The Board of Directors shall designate one of
the members of the Committee as chairman. The Committee may hold meetings at
such times and places as it shall determine. The acts of a majority of the
Committee members present at meetings at which a quorum exists, or acts reduced
to or approved in writing by all Committee members, shall be valid acts of the
Committee.

      (c)   Committee Responsibilities. Subject to the provisions of the Plan,
the Committee shall have full authority and discretion to take the following
actions.

            (i) To interpret the Plan and to apply its provisions,

            (ii) To adopt, amend or rescind rules, procedures and forms relating
      to the Plan,

            (iii) To authorize any person to execute, on behalf of the Company,
      any instrument required to carry out the purposes of the Plan,

                                      -3-


            (iv)  To determine when Shares are to be awarded or offered for sale
      and when Options are to be granted under the Plan,

            (v)   To select the Offerees and Optionees,

            (vi)  To determine the number of Shares to be offered to each
      Offeree or to be made subject to each Option,

            (vii) To prescribe the terms and conditions of each award or sale of
      Shares, including (without limitation) the Purchase Price, and to specify
      the provisions of the Stock Purchase Agreement relating to such award or
      sale,

            (viii) To prescribe the terms and conditions of each Option,
      including (without limitation) the Exercise Price, to determine whether
      such Option is to be classified as an ISO or as a Nonstatutory Option, and
      to specify the provisions of the Stock Option Agreement relating to such
      Option,

            (ix)  To amend any outstanding Stock Purchase Agreement or Stock
      Option Agreement, subject to applicable legal restrictions and to the
      consent of the Offeree or Optionee who entered into such agreement, and

            (x) To take any other actions deemed necessary or advisable for the
      administration of the Plan.

All decisions, interpretations and other actions of the Committee shall be final
and binding on all Offerees, all Optionees, and all persons deriving their
rights from an Offeree or Optionee. No member of the Committee shall be liable
for any action that he has taken or has failed to take in good faith with
respect to the Plan, any Option or any right to acquire Shares under the Plan.

      (d)   Financial Reports. Not less often than annually, the Company shall
furnish to Optionees and Offerees reports of its financial condition, unless
such Optionees and Offerees have access to equivalent information through their
employment. Such reports need not be audited.

                                      -4-


SECTION 4. ELIGIBILITY.

      (a)   General Rule. Only Employees shall be eligible for designation as
Optionees or Offerees by the Committee. In addition, only individuals who are
employees of the Company or of a Subsidiary as determined in accordance with the
provisions of Treasury Regulation Section 1.421-7(h) under the Code or any
successor regulations thereto shall be eligible for the grant of ISOs.

      (b)   Ten-Percent Shareholders. An Employee who owns more than 10 percent
of the total combined voting power of all classes of outstanding stock of the
Company or any of its Subsidiaries shall not be eligible for designation as an
Optionee of an ISO unless (i) the Exercise Price is at least 110 percent of the
Fair Market Value of a Share on the date of grant, and (ii) such ISO by its
terms is not exercisable after the expiration of five years from the date of
grant.

      (c)   Attribution Rules. For purposes of Subsection (b) above, in
determining stock ownership, an Employee shall be deemed to own the stock owned,
directly or indirectly, by or for his brothers and sisters (whether by the whole
or half blood), spouse, ancestors and lineal descendants. Stock owned, directly
or indirectly, by or for a corporation, partnership, estate or trust shall be
deemed to be owned proportionately by or for its shareholders, partners or
beneficiaries. Stock with respect to which such Employee holds an option shall
not be counted.

      (d)   Outstanding Stock. For purposes of Subsection (b) above,
"outstanding stock" shall include all stock actually issued and outstanding
immediately after the grant. "Outstanding stock" shall not include shares
authorized for issuance under outstanding options held by the Employee or by any
other person.

SECTION 5. STOCK SUBJECT TO PLAN.

      (a)   Basic Limitation. Shares offered under the Plan shall be authorized
but unissued Shares or shares of Stock reacquired in any manner. The aggregate
number of Shares which may be issued under the Plan (upon exercise of Options or
other rights to acquire Shares) shall not exceed 8,785,465 Shares, subject to
adjustment.

                                      -5-


pursuant to Section 9. The number of Shares which are subject to Options or
other rights outstanding at any time under the Plan shall not exceed the number
of Shares which then remain available for issuance under the Plan. The Company,
during the term of the Plan, shall at all times reserve and keep available
sufficient Shares to satisfy the requirements of the Plan.

      (b)   Additional Shares. In the event that any outstanding Option or other
right for any reason expires or is cancelled or otherwise terminated, the Shares
allocable to the unexercised portion of such Option or other right shall again
be available for issuance under the Plan. In the event that Shares are
reacquired by the Company pursuant to a forfeiture provision, a right of
repurchase, a right of first refusal or a transaction under Section 8(b), such
Shares shall again be available for the issuance under the Plan, provided that
Shares that were acquired pursuant to the exercise of an Option which are
subsequently reacquired by the Company shall not be available for issuance
pursuant to the exercise of another Option (except as specifically provided in
Section 5(a)) and provided further that, the cumulative number of such Shares
that are available for reissuance under the Plan will not exceed 8,785,465
Shares.

      (c)   Per-Participant. Limit Subject to adjustment under Section 9, no
Employee may receive rights to acquire Shares under the Plan (whether by way of
Option or otherwise) during any one fiscal year that exceeds 5,725,000 Shares.

SECTION 6. TERMS AND CONDITIONS OF AWARDS OR SALES.

      (a)   Stock Purchase Agreement. Each award or sale of Shares under the
Plan (other than upon exercise of an Option) shall be evidenced by a Stock
Purchase Agreement between the Offeree and the Company Such award or sale shall
be subject to all applicable terms and conditions of the Plan and may be subject
to any other terms and conditions which are not inconsistent with the Plan and
which the Committee deems appropriate for inclusion in a Stock Purchase
Agreement. The provisions of the various Stock Purchase Agreements entered into
under the Plan need not be identical.

                                      -6-


      (b)   Duration of Offers and Nontransferability of Rights. Any right to
acquire Shares under the Plan (other than an Option) shall automatically expire
if not exercised by the Offeree within 30 days after the grant of such right
was communicated to him by the Committee. Such right shall not be transferable
and shall be exercisable only by the Offeree to whom such right was granted.

      (c)   Purchase Price. The Purchase Price of Shares to be offered under the
Plan shall be determined by the Committee, in its sole and absolute discretion,
and may be less than, equal to, or greater than the Fair Market Value of such
Shares but in no event shall be less than the par value of such Shares. The
Purchase Price shall be payable in a form described in Section 8.

      (d)   Withholding Taxes. As a condition to the award or purchase of
Shares,the Offeree shall make such arrangements as the Committee may require for
the satisfaction of any federal, state or local withholding tax obligations that
may arise in connection with such award or purchase.

      (e)   Restrictions on Transfer of Shares. Any Shares awarded or sold under
the Plan shall be subject to such special forfeiture, conditions, rights of
repurchase, rights of first refusal and other transfer restrictions as the
Committee may determine. Such restrictions shall be set forth in the applicable
Stock Purchase Agreement and shall apply in addition to any general restrictions
that may apply to all holders of Shares. Any service-based vesting conditions
shall not be less rapid than the schedule set forth in Section 7(e).

SECTION 7. TERMS AND CONDITIONS OF OPTIONS.

      (a)   Stock Option Agreement. Each grant of an Option under the Plan shall
be evidenced by a Stock Option Agreement between the Optionee and the Company
Such Option shall be subject to all applicable terms and conditions of the Plan
and may be subject to any other terms and conditions which are not inconsistent
with the Plan and which the Committee deems appropriate for inclusion in a
Stock Option Agreement. The provisions of the various Stock Option Agreements
entered into under the Plan need not be identical.

                                      -7-

 (b)   Number of Shares. Each Stock Option Agreement shall specify the number of
Shares that are subject to the Option and shall provide for the adjustment of
such number in accordance with Section 9. The Stock Option Agreement shall also
specify whether the Option is an ISO or a Nonstatutory Option. In no event shall
the aggregate Fair Market Value of Stock (determined at the time an ISO is
granted) for which ISOs granted to any Employee are exercisable for the first
time by such Employee during any calendar year (under all stock option plans of
the Company and any Subsidiary) exceed One Hundred Thousand Dollars ($100,000),
provided, however, that this limitation shall have no force or effect if its
inclusion in the Plan is not necessary for Options issued as ISOs to qualify as
incentive stock options within the meaning of Section 422 of the Code. Any
Option which would, but for its failure to satisfy the foregoing restriction,
qualify as an ISO shall nevertheless be a valid Option, but to the extent of
such failure it shall be deemed to be a Nonstatutory Option.

      (c)   Exercise Price. Each Stock Option Agreement shall specify the
Exercise Price. The Exercise Price of an ISO shall not be less than 100 percent
of the Fair Market Value of a Share on the date of grant, except as otherwise
provided in Section 4(b). The Exercise Price of a Nonstatutory option shall be
determined by the Committee, in its sole and absolute discretion, and may be
less than, equal to, or greater than the Fair Market Value of a Share on the
date of grant. The Exercise Price shall be payable in a form described in
Section 8.

      (d)   Withholding Taxes. As a condition to the exercise of a Option, the
Optionee shall make such arrangements as the Committee may require for the
satisfaction of any federal, state or local withholding tax obligations that may
arise in connection with such exercise. The Optionee shall also make such
arrangements as the Committee may require for the satisfaction of any federal,
state or local withholding tax obligations that may arise in connection with the
disposition of Shares acquired by exercising an Option.

                                      -8-


      (e)   Exercisability and Term. Each Stock Option Agreement shall specify
the date when all or any installment of the Option is to become exercisable. An
Option shall become exercisable at least as rapidly as set forth in the
following schedule:



Anniversary of            Minimum Percentage
Date of Grant                Exercisable
- --------------            ------------------
                       
    First                         20%

    Second                        40%

    Third                         60%

    Fourth                        80%

    Fifth                        100%


Subject to the preceding sentence, the vesting of any Option shall be determined
by the Committee at its sole discretion. The Stock Option Agreement shall also
specify the term of the Option. The term shall not exceed 10 years from the date
of grant, except as otherwise provided in Section 4(b). Subject to the preceding
sentence, the Committee at its sole discretion shall determine when an Option is
to expire.

      (f)   Nontransferability. During an Optionee's lifetime, his Option(s)
shall be exercisable only by him and shall not be transferable. In the event of
an Optionee's death, his Option(s) shall not be transferable other than by will
or by the laws of descent and distribution.

      (g)   Termination of Service (Except by Death). If an Optionee's Service
terminates for any reason other than his death, then his Option(s) shall expire
on the earliest of the following occasions:

            (i)   The expiration date determined pursuant to Subsection(e)
      above,

            (ii)  The date 60 days after the termination of his Service for any
      reason other than Total and Permanent Disability, or

                                      -9-


            (iii) The date six months after the termination of his Service by
      reason of Total and Permanent Disability.

The Optionee may exercise all or part of his Option(s) at any time before the
expiration of such Option(s) under the preceding sentence, but only to the
extent that such Option(s) had become exercisable before his Service terminated
or became exercisable as a result of the termination. The balance of such
Option(s) shall lapse when the Optionee's Service terminates. In the event that
the Optionee dies after the termination of his Service but before the expiration
of his Option(s), all or part of such Option(s) may be exercised (prior to
expiration) by the executors or administrators of the Optionee's estate or by
any person who has acquired such Option(s) directly from him by bequest or
inheritance, but only to the extent that such Option(s) had become exercisable
before his Service terminated or became exercisable as a result of the
termination.

      (h)   Leaves of Absence. For purposes of Subsection (g) above, Service
shall be deemed to continue while the Optionee is on military leave, sick leave
or other bona fide leave of absence (as determined by the Committee). The
fore going notwithstanding, in the case of an ISO granted under the Plan,
Service shall not be deemed to continue beyond the first 90 days of such leave,
unless the Optionee's reemployment rights are guaranteed by statute or by
contract.

      (i)   Death of Optionee. If an Optionee dies while he is in Service, then
his Option(s) shall expire on the earlier of the following dates:

            (i)   The expiration date determined pursuant to Subsection (e)
      above, or

            (ii)  The date six months after his death.

All or part of the Optionee's Option(s) may be exercised at any time before the
expiration of such Option(s) under the preceding sentence by the executors or
administrators of his estate or by any person who has acquired Such Option(s)
directly from him by bequest or inheritance, but only to the extent that such
Option(s) had

                                      -10-


become exercisable before his death or became exercisable as a result of his
death. The balance of such Option(s) shall lapse when the Optionee dies.

      (j)   No Rights as a Shareholder. An Optionee, or a transferee of an
Optionee, shall have no rights as a shareholder with respect to any Shares
covered by his Option until the date of the issuance of a stock certificate for
such Shares. No adjustments shall be made, except as provided in Section 9.

      (k)   Modification, Extension and Renewal of Options. Within the
limitations of the Plan, the Committee may modify, extend or renew outstanding
Options or may accept the cancellation of outstanding Options (to the extent not
previously exercised) in return for the grant of new Options at the same or a
different price. The foregoing notwithstanding, no modification of an Option
shall, without the consent of the Optionee, impair his rights or increase his
obligations under such Option.

      (1)   Restrictions on Transfer of Shares. Any Shares issued upon exercise
of an Option shall be subject to such special forfeiture conditions, rights of
repurchase, rights of first refusal and other transfer restrictions as the
Committee may determine. Such restrictions shall be set forth in the applicable
Stock Option Agreement and shall apply in addition to any general restrictions
that may apply to all holders of Shares. Any service-based vesting conditions
shall not be less rapid than the schedule set forth in Subsection (e) above.

SECTION 8. PAYMENT FOR SHARES

      (a)   General Rule. The entire Purchase Price or Exercise Price of Shares
issued under the Plan shall be payable in cash or check payable to the order of
the Company at the time when such Shares are purchased, except as provided in
Subsections (b), (c), (d) and (e) below.

      (b)   Surrender of Stock. To the extent that a Stock Option Agreement so
provides, payment may be made all or in part with Shares which have already been
owned by the Optionee or his representative for more than 12 months and which
are surrendered to the Company in good form for transfer. Such Shares shall be
valued at their Fair Market Value on the date when the new Shares are purchased
under the Plan.

                                      -11-


      (c)   Services Rendered. At the discretion of the Committee, Shares may be
awarded under the Plan in consideration of services rendered to the Company or a
Subsidiary prior to the award. If Shares are awarded without the payment of a
Purchase Price in cash, the Committee shall make a determination (at the time of
the award) of the value of the services rendered by the Offeree and the
sufficiency of the consideration to meet the requirements of Section 6(c) and
applicable law.

      (d)   Full Recourse Note. At the discretion of the Committee, a portion of
the Purchase Price or Exercise Price of Shares issued under the Plan may be
payable by the issuance and delivery to the Company or a Subsidiary by the
Optionee or Offeree of a personal full recourse note of the Optionee or Offeree
bearing interest payable not less than annually at no less than 100% of the
lowest applicable Federal rate as determined in accordance with Section 1274(d)
of the Code, provided such note is secured by the Shares so purchased, provided
further that the Optionee or Offeree deliver to the Company cash or a check
payable to the order of the Company in an amount equal to the aggregate par
value of the Shares to be issued.

      (e)   Cashless Exercise. Only if the Stock is then publicly traded and
only in the case of the exercise of an Option, delivery of an irrevocable and
unconditional undertaking by a creditworthy broker to deliver promptly to the
Company sufficient funds to pay the Exercise Price of an Option, or delivery by
the Optionee to the Company of a copy of irrevocable and unconditional
instructions to a creditworthy broker to deliver promptly to the Company cash or
a check payable to the order of the Company sufficient to pay the Exercise Price
of an Option.

SECTION 9. ADJUSTMENT OF SHARES.

      (a)   General. In the event of a subdivision of the outstanding Stock, a
declaration of a dividend payable in Shares, a declaration of a dividend payable
in a form other than Shares in an amount that has a material effect on the value
of Shares, a combination or consolidation of the outstanding Stock (by
reclassification or otherwise) into a lesser number of Shares, a
recapitalization or a similar occurrence, the

                                      -12-


Committee shall make appropriate adjustments in one or more of (i) the number of
Shares available for future grants under Section 5, (ii) the number of Shares
covered by each outstanding Option, or (iii) the Exercise Price under each
outstanding Option.

      (b) Mergers and Other Reorganizations. In the event that the Company is to
be consolidated with or acquired by another entity in a merger, sale of all or
substantially all of the Company's assets or otherwise, all outstanding Options
shall be subject to the agreement governing such transaction. Such agreement
shall provide (i) for the assumption of outstanding Options by the surviving
corporation or its parent or for its continuation by the Company (if the Company
is a surviving corporation), without the Optionees' consent, (ii) for the
acceleration of the exercisability of outstanding Options followed by their
cancellation if not exercised, without the Optionees' consent (and any such
cancellation shall not occur earlier than 30 days after such acceleration is
effective and the Optionees have been notified of such acceleration), (iii) for
a limited period of exercise of outstanding Options to the extent then
exercisable, without the Optionees' consent, upon notice to the Optionees,
followed by its cancellation if not exercised (and any such cancellation shall
not occur earlier than 30 days after such limited period of exercise is
effective and the Optionees have been notified of such), or (iv) for the
termination of outstanding Options in exchange for a cash payment equal to the
difference between the Fair Market Value of one Share (if greater than the
Exercise Price) and the Exercise Price multiplied by the number of Shares
issuable upon exercise of such outstanding Options, but only with the Optionees'
consent.

      (c) Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, all outstanding Options granted hereunder shall
terminate immediately prior to the consummation of such action or at such other
time and subject to such other conditions as shall be determined by the
Committee.

      (d) Reservation of Rights. Except as provided in this Section 9, an
Optionee or Offeree shall have no rights by reason of any subdivision or
consolidation of shares of stock of any class, the payment of any dividend or
any other increase or decrease in the number of shares of stock of any class.
Any issue by the Company of

                                      -13-


shares of stock of any class, or securities convertible into shares of stock of
any class, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or Exercise Price of the Shares subject to an
Option. The grant of an Option pursuant to the Plan shall not affect in any way
the right or power of the Company to make adjustments, reclassifications,
reorganizations or changes of its capital or business structure to merge or
consolidate or to dissolve, liquidate, sell or transfer all or any part of its
business or assets. Any shares of the capital stock of the Company issued or
issuable pursuant to the foregoing adjustments shall be subject to the same
restrictions imposed on the Options granted under the Plan and the Shares issued
or issuable upon exercise of such Options.

      (e) Fractional Shares. No fractional shares shall be issued under the Plan
and the Optionees shall receive from the Company cash in lieu of such fractional
shares.

SECTION 10. LEGAL REQUIREMENTS.

      (a) Securities Laws. Shares shall not be issued under the Plan unless the
issuance and delivery of such Shares comply with (or are exempt from) all
applicable requirements of law, including (without limitation) the Securities
Act of 1933, as amended, the rules and regulations promulgated thereunder, state
securities laws and regulations, and the regulations of any stock exchange on
which the Company's securities may then be, listed.

      (b) S Corporation Status. In the event that the Company is an S
corporation," as defined in section 1361 (a) of the Code, Shares shall not be
issued under the Plan if the issuance or delivery of such Shares would cause the
Company to lose its status as an "S corporation".

SECTION 11. NO EMPLOYMENT RIGHTS.

      No provision of the Plan, nor any right or Option granted under the Plan,
shall be construed to give any person any right to become, to be treated as, or
to remain an Employee. The Company and its Subsidiaries reserve the right to
terminate any person's Service at any time and for any reason.

                                      -14-


SECTION 12. DURATION AND AMENDMENTS, GOVERNING LAW, CONFIDENTIALITY.

      (a) Term of the Plan. The Plan, as set forth herein, shall become
effective on November 16, 1994 subject to the approval of the Company's
shareholders In the event that the shareholders fail to approve the Plan within
12 months after its adoption by the Board of Directors, any Option grants or
Stock awards already made shall be null and void, and no additional Option
grants or Stock awards shall be made after such date. The Plan shall terminate
automatically on November 16, 2004 and may be terminated on any earlier date
pursuant to Subsection (b) below.

      (b) Right to Amend or Terminate the Plan. The Board of Directors may
amend, suspend or terminate the Plan at any time and for any reason, provided,
however, that any amendment of the Plan which increases the number of Shares
available for issuance under the Plan (except as provided in Section 9), or
which materially changes the class of persons who are eligible for the grant of
ISOs, shall be subject to the approval of the Company's shareholders Shareholder
approval shall not be required for any other amendment of the Plan.

      (c) Effect of Amendment or Termination. No Shares shall be issued or sold
under the Plan after the termination thereof, except upon exercise of an Option
granted prior to such termination. The termination of the Plan, or any amendment
thereof, shall not affect any Share previously issued or any Option previously
granted under the Plan.

      (d) Governing Law. The Plan and all awards or sales of Shares or grants of
Options hereunder shall be governed and interpreted in accordance with the laws
of the State of Delaware, without regard to any applicable conflicts of law.

      (e) Confidentiality. Notwithstanding anything to the contrary in this Plan
or any Stock Purchase Agreement or Stock Option Agreement entered into under
this Plan, nothing shall in any way limit the ability of the Company or any
Offeree or Optionee to disclose to any person the tax treatment and tax
structure of any right to purchase Shares granted hereunder.

                                      -15-


SECTION 13. EXECUTION.

      To record the adoption of the Plan, the Company has caused its authorized
officer to execute the same.

                                  IROBOT CORPORATION

                                  By /s/ Colin Angle
                                     --------------------------

                                  Title Chief Executive Officer

                                      -16-


                               IROBOT CORPORATION

                          STOCK OPTION GRANT AGREEMENT

      THE OPTION GRANTED PURSUANT TO THIS INCENTIVE STOCK OPTION AGREEMENT (THE
"OPTION") AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND MAY NOT BE PLEDGED, HYPOTHECATED, SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR
THE OPTION OR THE SHARES UNDER THE SECURITIES ACT, OR AN OPINION OF COUNSEL,
WHICH IS SATISFACTORY TO THE CORPORATION AND ITS COUNSEL, THAT SUCH REGISTRATION
IS NOT REQUIRED.

                      1994 STOCK PLAN OF IROBOT CORPORATION

                        INCENTIVE STOCK OPTION AGREEMENT

      THIS AGREEMENT, entered into as of _______________________, 200__, is
between IROBOT CORPORATION, a Delaware corporation (the "Company"), and
____________________________________________ (the "Optionee").

                              W I T N E S S E T H:

      WHEREAS, the Company's Board of Directors has established the 1994 Stock
Plan of IRobot Corporation in order to provide selected directors, officers,
employees and consultants of the Company and its Subsidiaries with an
opportunity to acquire Common Stock of the Company; and

      WHEREAS, the Committee has determined that it would be in the best
interests of the Company and its shareholders to grant the Incentive Stock
Option described in this Agreement to the Optionee as an inducement to enter
into or remain in the service of the Company and as an incentive for
extraordinary efforts during such service;

      NOW, THEREFORE, for valuable consideration, the receipt and adequacy of
which is hereby acknowledged, the parties, intending to be legally bound hereby,
agree as follows:

SECTION 1. GRANT OF OPTION.

      (a) Option. On the terms and conditions stated below, the Company hereby
grants to the Optionee the option to purchase _________________________
( ________ ) Shares for the sum of [___________________________] ($[____]) per
share. It is understood and intended that this option shall qualify as an
Incentive Stock Option. Accordingly, the Optionee understands that in order to
obtain the beneficial tax treatment accorded an Incentive Stock Option, no sale
or other disposition may be made of any Shares acquired upon exercise of the
option within one (1) year after the day of the transfer of such Shares to the
Optionee, nor within two (2) years after the Date of Grant. If the Optionee
intends to dispose, or does dispose (whether by sale, exchange, gift, transfer
or otherwise), of any such Shares within either of said periods, he or she will
notify the Company in writing within ten (10) days after such disposition.



      (b) Stock Plan. This option is granted pursuant to the Plan, a copy of
which the Optionee acknowledges having received and read. The provisions of the
Plan are incorporated into this Agreement by this reference.

      (c) Grant Condition. The granting of this option shall be subject to
receipt by the Company of the Company's current form of Invention and
Confidentiality Agreement, executed and delivered by the Optionee.

SECTION 2. NO TRANSFER OR ASSIGNMENT OF OPTION.

      Except as otherwise provided in this Agreement, this option and the rights
and privileges conferred hereby shall not be transferred, assigned, pledged or
hypothecated in any way (whether by operation of law or otherwise) and shall not
be subject to sale under execution, attachment or similar process. Upon any
attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this
option, or of any right or privilege conferred hereby, contrary to the
provisions hereof, or upon any attempted sale under any execution, attachment or
similar process upon the rights and privileges conferred hereby, this option and
the rights and privileges conferred hereby shall immediately become null and
void.

SECTION 3. RIGHT TO EXERCISE.

      (a) Vesting. Subject to the conditions stated herein, the right to
exercise this option shall accrue in installments as follows provided the
Optionee has continued to be an Employee through any such applicable date:



                                Percentage
                             Shares Exercisable
                             ------------------
                          
Date of Grant                         0%

First Anniversary of
Date of Grant                        20%

Second Anniversary of
Date of Grant                        40%

Third Anniversary of
Date of Grant                        60%

Fourth Anniversary of
Date of Grant                        80%

Fifth Anniversary of
Date of Grant                       100%


                                      -2-


      (b) Periods of Nonexercisability. Any other provision of this Agreement
notwithstanding, the Company shall have the right to designate one or more
periods of time, each of which shall not exceed 18 consecutive months in length,
during which this option shall not be exercisable if the Company determines (in
its sole discretion) that such limitation on exercise could in any way
facilitate a lessening of any restriction on transfer pursuant to the Securities
Act or any state securities laws with respect to any issuance of securities by
the Company, facilitate the registration or qualification of any securities by
the Company under the Securities Act or any state securities laws, or facilitate
the perfection of any exemption from the registration or qualification
requirements of the Securities Act or any applicable state securities laws for
the issuance or transfer of any securities. Such limitation on exercise shall
not alter the vesting of this option as set forth in Section 3(a) other than to
limit the periods during which this option shall be exercisable. The Optionee
shall be notified in writing of any such designation by the Company.

      (c) Shareholder Approval. Any other provision of this Agreement
notwithstanding, this option shall not be exercisable at any time prior to the
approval of the Plan by the holders of a majority of the outstanding stock of
the Company.

      (d) Termination Upon Breach of Certain Agreements. Notwithstanding the
foregoing, if, in the judgment of the Company, the Optionee, prior to the
expiration date of this option, materially violates the non-competition,
non-solicitaion, assignment of inventions or confidentiality provisions of any
employment contract, confidentiality and nondisclosure agreement or other
agreement between the Optionee and the Company, the right to exercise this
option shall terminate immediately upon written notice to the Optionee from the
Company describing such violation.

SECTION 4. EXERCISE PROCEDURES.

      (a) Notice of Exercise. The Optionee or the Optionee's representative may
exercise this option by giving written notice to the Secretary of the Company
pursuant to Section 12(d). The notice shall specify the election to exercise
this option, the number of Shares for which it is being exercised, and the form
of payment. The notice shall be signed by the person or persons exercising this
option. In the event that this option is being exercised by the representative
of the Optionee, the notice shall be accompanied by proof (satisfactory to the
Company) of the representative's right to exercise this option. The Optionee or
the Optionee's representative shall deliver to the Secretary of the Company, at
the time of giving the notice, payment in a form permissible under Section 5 for
the full amount of the Purchase Price.

      (b) Issuance of Shares. After receiving a proper notice of exercise, the
Company shall cause to be issued a certificate or certificates for the Shares as
to which this option has been exercised, registered in the name of the person
exercising this option (or in the names of such person and his or her spouse as
community property or as joint tenants with right of survivorship). The Company
shall cause such certificate or certificates to be delivered to or upon the
order of the person exercising this option.

                                      -3-


SECTION 5. PAYMENT FOR STOCK

      The entire Purchase Price may be paid in U.S. dollars. Alternatively, all
or part of the Purchase Price may be paid by the surrender of Shares in good
form for transfer. Such Shares must have been owned for more than 12 months by
the Optionee or the Optionee's representative and must have a fair market value
(as determined by the Committee) on the date of exercise of this option which,
together with any amount paid in cash, is equal to the Purchase Price.

SECTION 6. TERM AND EXPIRATION.

      (a) Basic Term. This option shall in any event expire on the date 10 years
after the Date of Grant.

      (b) Termination of Service (Except by Death). If the Optionee's service as
an Employee terminates for any reason other than death, then this option shall
expire on the earliest of the following occasions:

            (i) The expiration date determined pursuant to Subsection (a) above;

            (ii) The date 60 days after the termination of the Optionee's
      service as an Employee for any reason other than Total and Permanent
      Disability; or

            (iii) The date six months after the termination of the Optionee's
      service as an Employee by reason of Total and Permanent Disability.

The Optionee may exercise all or part of this option at any time before its
expiration under the preceding sentence, but only to the extent that this option
had become exercisable before the Optionee's service terminated. The balance of
this option shall lapse when the Optionee's service as an Employee terminates.
In the event that the Optionee dies after the termination of service but before
the expiration of this option, all or part of this option may be exercised
(prior to expiration) by the executors or administrators of the Optionee's
estate or by any person who has acquired this option directly from the Optionee
by bequest or inheritance, but only to the extent that this option had become
exercisable before the Optionee's service terminated.

      (c) Death of Optionee. If the Optionee dies as an Employee, then this
option shall expire on the earlier of the following dates:

            (i) The expiration date determined pursuant to Subsection (a) above;
      or

            (ii) The date six months after the Optionee's death.

All or part of this option may be exercised at any time before its expiration
under the preceding sentence by the executors or administrators of the
Optionee's estate or by any person who has acquired this option directly from
the Optionee by bequest or inheritance, but only to the extent that this option
had become exercisable before the Optionee's death. The balance of this option
shall lapse when the Optionee dies.

                                      -4-


      (d) Leaves of Absence. For purposes of this Section 6, the Employee
relationship shall be deemed to continue during any period when the Optionee is
on military leave, sick leave or other bona fide leave of absence (to be
determined in the sole discretion of the Committee). However, if the Optionee's
reemployment rights are not guaranteed by statute or by contract, then the
Employee relationship shall not be deemed to continue beyond the 90th day of
such period.

SECTION 7. THE COMPANY'S RIGHT OF FIRST REFUSAL

      (a) Right of First Refusal. In the event that the Optionee or a Transferee
proposes to sell, pledge or otherwise transfer to any person any Shares acquired
under this Agreement, or any interest in such Shares, the Company shall have the
Right of First Refusal with respect to such Shares. If the Optionee or
Transferee desires to transfer Shares acquired under this Agreement, the
Optionee or Transferee shall give a written Transfer Notice to the Company
describing fully the proposed transfer, including the number of Shares proposed
to be transferred, the proposed transfer price and the name and address of the
proposed Transferee. The Transfer Notice shall be signed both by the Optionee or
Transferee and by the proposed new Transferee and must constitute a binding
commitment of both parties to the transfer of the Shares. The Company shall have
the right to purchase the Shares on the terms of the proposal described in the
Transfer Notice (subject, however, to any change in such terms permitted under
Subsection (b) below) by delivery of a notice of exercise of the Right of First
Refusal within in 30 days after the date when the Transfer Notice was received
by the Company. The Company's rights under this Subsection (a) shall be freely
assignable, in whole or in part.

      (b) Transfer of Shares. If the Company fails to exercise its Right of
First Refusal within 30 days after the date when it received the Transfer
Notice, the Optionee or Transferee may, not later than 90 days following receipt
of the Transfer Notice by the Company, conclude a transfer of the Shares subject
to the Transfer Notice on the terms and conditions described in the Transfer
Notice. Any proposed transfer on terms and conditions different from those
described in the Transfer Notice, as well as any subsequent proposed transfer by
the Optionee or Transferee, shall again be subject to the Right of First Refusal
and shall require compliance with the procedure described in Subsection (a)
above. If the Company exercises its Right of First Refusal, the parties shall
consummate the sale of the Shares on the terms set forth in the Transfer Notice;
provided, however, that in the event the Transfer Notice provides that payment
for the Shares is to be made in a form other than lawful money paid at the time
of transfer, the Company shall have the option of paying for the Shares with
lawful money equal to the present value of the consideration described in the
Transfer Notice.

      (c) Binding Effect. The Company's Right of First Refusal shall inure to
the benefit of its successors and assigns and shall be binding upon any
Transferee of the Shares.

      (d) Termination of Right of First Refusal. Any other provision of this
Section 7 notwithstanding, in the event that Stock is listed on an established
stock exchange or is quoted regularly on the NASDAQ System at the time when the
Optionee or Transferee desires to transfer Shares, the Company shall have no
Right of First Refusal, and the Optionee or Transferee shall have no obligation
to comply with the procedures prescribed by Subsections (a), (b) and (c) above.

                                      -5-


SECTION 8. RIGHT OF REPURCHASE.

      (a) Basic Repurchase Right. The Shares acquired under this Agreement shall
be Restricted Shares and shall be subject to the right (but not an obligation)
of repurchase by the Company. The Company's rights under this Subsection (a)
shall be freely assignable, in whole or in part.

      (b) Condition Precedent to Exercise. The Company's right of repurchase
shall be exercisable only during the 60-day period next following the later of
(i) the date when the Optionee ceases to be an Employee for any reason, with or
without cause, including (without limitation) death or disability, or (ii) the
date when the option was exercised by the Optionee, the executors or
administrators of the Optionee's estate or any person who has acquired the
option directly from the Optionee by bequest or inheritance.

      (c) Repurchase Cost. If the Company exercises its right to repurchase, it
shall pay the Optionee an amount equal to (1) the greater of (i) the price per
Share paid by the Optionee under Section 1(a) hereof, or (ii) Fair Market Value
at the time of repurchase multiplied by (2) the number of Restricted Shares to
be repurchased. The Company's right of repurchase shall terminate with respect
to Restricted Shares if the Stock is listed on an established stock exchange or
quoted regularly on the NASDAQ System.

      (d) Exercise of Repurchase Right. If the Company elects to exercise its
right of repurchase with respect to any Restricted Shares, it must exercise its
right of repurchase with respect to all Restricted Shares. The Company's right
of repurchase shall be exercisable only by written notice delivered to the
Optionee prior to the expiration of the 60-day period specified in Subsection
(b) above. The notice shall set forth the date on which the repurchase is to be
effected. Such date shall not be more than 30 days after the date of the notice.
The certificate(s) representing the Restricted Shares to be repurchased shall,
prior to the close of business on the date specified for the repurchase, be
delivered to the Secretary of the Company. Each certificate shall be properly
endorsed for transfer. The Company shall, concurrently with the receipt of such
certificate(s), pay to the Optionee the purchase price determined according to
Subsection (c) above. Payment shall be made in lawful money of the United States
of America. The Company's right of repurchase shall terminate with respect to
any Restricted Shares for which it has not been timely exercised pursuant to
this Subsection (d).

      (e) Cancellation of Shares. If the Company makes available, at the time
and place and in the amount and form provided in this Agreement, the
consideration for the Restricted Shares to be repurchased in accordance with the
provisions of this Agreement, then after such time the person from whom such
Restricted Shares are to be repurchased shall no longer have any rights as a
holder of such Restricted Shares (other than the right to receive payment of
consideration in accordance with this Agreement). Such Restricted Shares shall
be deemed to have been repurchased in accordance with the applicable provisions
hereof, whether or not the certificate (s) therefor have been delivered as
required by this Agreement.

      (f) Additional Shares or Substituted Securities. In the event of the
declaration of a stock dividend, the declaration of any extraordinary dividend
payable in a form other than stock, a stock split, an adjustment in conversion
ratio, a recapitalization or a similar transaction affecting the Company's
outstanding securities without receipt of consideration, any new, substituted or
additional securities or other property (including money paid other than as an
ordinary cash dividend) that are by reason of

                                      -6-


such transaction distributed with respect to any Restricted Shares or into which
such Restricted Shares thereby become convertible, shall immediately be subject
to the Company's right of repurchase. Appropriate adjustments to reflect the
distribution of such securities or property shall be made to the number and/or
class of the Restricted Shares. Appropriate adjustments shall also, after each
such transaction, be made to the price per share to be paid upon the exercise of
the right of repurchase in order to reflect any change in the Company's
outstanding securities effected without receipt of consideration therefor;
provided, however, that the aggregate purchase price payable for the Restricted
Shares shall remain the same.

      (g) Legends. In addition to the legends required by Section 10 (c), all
certificates representing Shares purchased under this Agreement shall be
endorsed with the following legend:

      "THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED, TRANSFERRED,
      ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE
      TERMS OF A WRITTEN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER
      OF THE SHARES (OR THE PREDECESSOR IN INTEREST TO THE SHARES). SUCH
      AGREEMENT GRANTS CERTAIN REPURCHASE RIGHTS TO THE COMPANY UPON TERMINATION
      OF SERVICE WITH THE COMPANY AND CERTAIN RIGHTS OF FIRST REFUSAL UPON AN
      ATTEMPTED TRANSFER OF THE SHARES. THE SECRETARY OF THE COMPANY WILL UPON
      WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENT TO THE HOLDER HEREOF
      WITHOUT CHARGE."

SECTION 9. LEGALITY OF INITIAL ISSUANCE.

      No Shares shall be issued upon the exercise of this option unless and
until the Company has determined that:

      (a) It and the Optionee have taken any actions required to register the
Shares under the Securities Act or to perfect an exemption from the registration
requirements thereof;

      (b) Any applicable listing requirement of any stock exchange on which
Stock is listed has been satisfied; and

      (c) Any other applicable provision of state or federal law has been
satisfied.

SECTION 10. RESTRICTIONS ON TRANSFER OF SHARES.

      (a) Restrictions. The option granted hereunder is subject to the transfer
restrictions set forth in the Plan. The Optionee shall not sell, transfer,
assign, encumber, hypothecate or otherwise dispose of any Shares except in
accordance with Section 7 and Section 8; provided, however, the Company may
impose additional restrictions upon the sale, pledge or other transfer of such
Shares (including the placement of appropriate legends on stock certificates)
if, in the judgment of the Company and its counsel, such restrictions are
necessary or desirable in order to achieve compliance with the provisions

                                      -7-


of the Securities Act, the securities laws of any state or any other law,
regardless of whether the offering and sale of Shares under the Plan have been
registered under the Securities Act or have been registered or qualified under
the securities laws of any state.

      (b) Investment Representations. The Optionee represents, warrants and
covenants that:

            (i) Any Shares purchased upon exercise of this option shall be
acquired for the Optionee's account for investment only and not with a view to,
or for sale in connection with, any distribution of the Shares in violation of
the Securities Act or any rule or regulation under the Securities Act;

            (ii) The Optionee has had such opportunity as the Optionee has
deemed adequate to obtain from representatives of the Company such information
as is necessary to permit the Optionee to evaluate the merits and risks of the
Optionee's investment in the Company;

            (iii) The Optionee is able to bear the economic risk of holding
Shares acquired pursuant to the exercise of this option for an indefinite
period;

            (iv) The Optionee understands that (A) the Shares acquired pursuant
to the exercise of this option will not be registered under the Securities Act
and are "restricted securities" within the meaning of Rule 144 under the
Securities Act; (B) such Shares cannot be sold, transferred or otherwise
disposed of unless they are subsequently registered under the Securities Act or
an exemption from registration is then available; (C) in any event, an exemption
from registration under Rule 144 or otherwise under the Securities Act may not
be available for at least one year and even then will not be available unless a
public market then exists for the Stock, adequate information concerning, the
Company is then available to the public and other terms and conditions of Rule
144 are complied with; and (D) there is now no registration statement on file
with the Securities and Exchange Commission with respect to any Stock of the
Company and the Company has no obligation or current intention to register any
Shares acquired pursuant to the exercise of this option under the Securities
Act;

            (v) The Optionee agrees that, if the Company offers for the first
time any of its Stock for sale pursuant to a registration statement under the
Securities Act, the Optionee will not, without the prior written consent of the
Company, publicly offer, sell, contract to sell or otherwise dispose of,
directly or indirectly, any Shares purchased upon exercise of this option for a
period of ninety (90) days, or such longer period as the Company may reasonably
require, after the effective date of such registration statement; and

            (vi) The Optionee's principal residence is at the address set forth
below on the signature page and the Optionee shall promptly notify the Company
of any change in the Optionee's principal address.

By making payment upon any exercise of this option, in whole or in part, the
Optionee shall be deemed to have reaffirmed, as of the date of such payment, the
representations made in this Section 10(b).

      (c) Legend. All certificates evidencing Shares acquired under this
Agreement in an unregistered transaction shall bear the following restrictive
legend (and such other restrictive legends as are required or deemed advisable
under the provisions of any applicable law):

                                      -8-


      "THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR
      OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH
      ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL,
      THAT SUCH REGISTRATION IS NOT REQUIRED."

      (d) Removal of Legends. If, in the opinion of the Company and its counsel,
any legend placed on a stock certificate representing Shares sold under this
Agreement is no longer required, the holder of such certificate shall be
entitled to exchange such certificate for a certificate representing the same
number of Shares but lacking such legend.

      (e) Administration. Any determination by the Company and its counsel in
connection with any of the matters set forth in this Section 10 shall be
conclusive and binding on the Optionee and all other persons.

SECTION 11. SHARES AND ADJUSTMENTS.

      (a) General. In the event of a subdivision of the outstanding Shares, a
declaration of a dividend payable in shares, a declaration of a dividend payable
in a form other than Shares in an amount that has a material effect on the value
of Shares, a combination or consolidation of the outstanding Shares (by
reclassification or otherwise) into a lesser number of Shares, a
recapitalization or a similar occurrence, the Committee shall make appropriate
adjustments in one or both of (i) the number of shares covered by this option or
(ii) the Exercise Price.

      (b) Mergers and Other Reorganizations. In the event that the Company is to
be consolidated with or acquired by another entity in a merger, sale of all or
substantially all of the Company's assets or otherwise, this option shall be
subject to the agreement governing such transaction. Such agreement shall
provide (i) for the assumption of this option by the surviving corporation or
its parent or for its continuation by the Company (if the Company is a surviving
corporation), without the Optionee's consent, (ii) for the acceleration of the
exercisability of this option followed by its cancellation if not exercised,
without the Optionee's consent (and any such cancellation shall not occur
earlier than 30 days after such acceleration is effective and the Optionee has
been notified of such acceleration), (iii) for a limited period of exercise of
this option to the extent then exercisable, without the Optionee's consent, upon
notice to the Optionee, followed by its cancellation if not exercised (and any
such cancellation shall not occur earlier than 30 days after such limited period
of exercise is effective and the Optionee has been notified of such), or (iv)
for the termination of this option in exchange for a cash payment equal to the
difference between the Fair Market Value of one Share (if greater than the
Exercise Price) and the Exercise Price multiplied by the number of Shares
issuable upon exercise of this option, but only with the Optionee's consent.

      (c) Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, the option granted hereunder shall terminate
immediately prior to the consummation of such action or at such other time and
subject to such other conditions as shall be determined by the Committee.

                                      -9-


      (d) Reservation of Rights. Except as provided in this Section 11, the
Optionee shall have no rights by reason of any subdivision or consolidation of
shares of stock of any class, the payment of any dividend or any other increase
or decrease in the number of shares of stock of any class. Any issue by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number or Exercise Price of the Shares
subject to this option. The grant of this option shall not affect in any way the
right or power of the Company to make adjustments, reclassifications,
reorganizations or changes of its capital or business structure, to merge or
consolidate or to dissolve, liquidate, sell or transfer all or any part of its
business or assets. Any shares of the capital stock of the Company issued or
issuable to the Optionee pursuant to the foregoing adjustments shall be subject
to the same restrictions imposed on the option granted hereunder and the Shares
issued or issuable upon exercise of such option.

      (e) Fractional Shares. No fractional shares shall be issued under the Plan
and the optionee shall receive from the Company cash in lieu of such fractional
shares.

SECTION 12. MISCELLANEOUS PROVISIONS.

      (a) Withholding Taxes. In the event that the Company determines that it is
required to withhold foreign, federal, state or local tax as a result of the
exercise of this option, the Optionee, as a condition to the exercise of this
option, shall make arrangements satisfactory to the Company to enable it to
satisfy all withholding requirements. The Optionee shall also make arrangements
satisfactory to the Company to enable it to satisfy any withholding requirements
that may arise in connection with the disposition of Shares purchased by
exercising this option.

      (b) Rights as a Shareholder. Neither the Optionee nor the Optionee's
representative shall have any rights as a shareholder with respect to any Shares
subject to this Option until such Shares have been issued in the name of the
Optionee or the Optionee's representative.

      (c) No Employment Rights. Nothing in this Agreement shall be construed as
giving the Optionee the right to be retained as an Employee. The Company
reserves the right to terminate the Optionee's service at any time, with or
without cause.

      (d) Notice. Any notice required by the terms of this Agreement shall be
given in writing and shall be deemed effective upon personal delivery or upon
deposit with the United States Postal Service, by registered or certified mail
with postage and fees prepaid and addressed to the party entitled to such notice
at the address shown below such party's signature on this Agreement, or at such
other address as such party may designate by 10 days, advance written notice to
the other party to this Agreement.

      (e) Entire Agreement; Severability. This Agreement and the Plan constitute
the entire contract between the parties hereto with regard to the subject matter
hereof. Whenever possible, each provision of this Agreement shall be interpreted
in such a manner as to be effective and valid under applicable law, but if any
provision of this Agreement shall be deemed prohibited or invalid under such
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, and such prohibition or invalidity shall not
invalidate the remainder of such provision or the other provisions of this
Agreement.

                                      -10-


      (f) Choice of Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the Commonwealth of Massachusetts, as such laws are
applied to contracts entered into and performed in such Commonwealth.

      (g) Specific Performance. It is specifically understood and agreed that
any breach of the provisions of this Agreement by the Optionee will result in
irreparable injury to the Company, that the remedy at law alone will be an
inadequate remedy for such breach, and that, in addition to any other remedies
which the Company may have, the Company may enforce its rights by actions for
specific performance (to the extent permitted by law). The Company may refuse to
recognize any unauthorized transferee as one of its stockholders for any
purpose, including, without limitation, for purposes of dividend and voting
rights, until the relevant party or parties have complied with all applicable
provisions of this Agreement.

SECTION 13. DEFINITIONS.

      (a) "Agreement" shall mean this Incentive Stock Option Agreement.

      (b) "Board" shall mean the Board of Directors of the Company, as
constituted from time to time.

      (c) "Code" shall mean the Internal Revenue Code or 1986, as amended.

      (d) "Committee" shall mean the committee of the Board described in Section
3 of the Plan or, if none has been appointed, the full Board.

      (e) "Date of Grant" shall mean the date on which the Committee resolved to
grant this option, which is also the date as of which this Agreement is entered
into.

      (f) "Employee" shall mean any employee of the Company or of a Subsidiary
as determined in accordance with the provisions of Treasury Regulation Section
1.421-7(h) under the Code or any successor regulations thereto.

      (g) "Exercise Price" shall mean the amount for which one Share may
purchased upon exercise of this option, as specified in Section 1(a).

      (h) "Fair Market Value" shall mean the fair market value of a Share, as
determined by the Committee in good faith. Such determination shall be
conclusive and binding on all persons.

      (i) "Incentive Stock Option" shall mean an employee incentive stock option
described in section 422(b) of the Code.

      (j) "Nonstatutory Stock Option" shall mean a stock option not described in
section 422(b) or section 423(b) of the Code.

      (k) "Plan" shall mean the 1994 Stock Plan of IRobot Corporation as in
effect on the Date of Grant.

                                      -11-


      (l) "Purchase Price" shall mean the Exercise Price multiplied by the
number of Shares with respect to which this option is being exercised.

      (m) "Restricted Share" shall mean a Share which is subject to the
Company's right of repurchase under Section 8.

      (n) "Right of First Refusal" shall mean the Company's right of first
refusal described in Section 7.

      (o) "Securities Act" shall mean the Securities Act of 1933, as amended.

      (p) "Share" shall mean one share of Stock, as adjusted in accordance with
Section 11 (if applicable).

      (q) "Stock" shall mean the Common Stock of Company.

      (r) "Subsidiary" shall mean any corporation, if the Company and/or one or
more other Subsidiaries own not less than 50% of the total combined voting power
of all classes of outstanding stock of such corporation.

      (s) "Total and Permanent Disability" shall mean that the Optionee is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted, or can be expected to last, for a continuous period
of not less than six months.

      (t) "Transferee" shall mean any person to whom the Optionee has directly
or indirectly transferred any Share acquired under this Agreement.

      (u) "Transfer Notice" shall mean the notice of a proposed transfer of
Shares described in Section 7.

      IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
on its behalf by its officer duly authorized to act on behalf of the Committee,
and the Optionee has personally executed this Agreement.

OPTIONEE                                      IROBOT CORPORATION

___________________________________           By: _____________________________
Name:
Optionee's Address:                           Company's Address:
                                              Twin City Office Center
                                              Suite #6
                                              22 McGrath Highway
                                              Somerville, MA 02143

                                      -12-


                               IROBOT CORPORATION

                          STOCK OPTION GRANT AGREEMENT

      THE OPTION GRANTED PURSUANT TO THIS NONSTATUTORY STOCK OPTION AGREEMENT
(THE "OPTION") AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND MAY NOT BE PLEDGED, HYPOTHECATED, SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR
THE OPTION OR THE SHARES UNDER THE SECURITIES ACT, OR AN OPINION OF COUNSEL,
WHICH IS SATISFACTORY TO THE CORPORATION AND ITS COUNSEL, THAT SUCH REGISTRATION
IS NOT REQUIRED.

                      1994 STOCK PLAN OF IROBOT CORPORATION

                       NONSTATUTORY STOCK OPTION AGREEMENT

      THIS AGREEMENT, entered into as of _______________________, 199__, is
between IROBOT CORPORATION, a Delaware corporation (the "Company"), and
____________________________________________ (the "Optionee").

                              W I T N E S S E T H:

      WHEREAS, the Company's Board of Directors has established the 1994 Stock
Plan of IRobot Corporation in order to provide selected Employees of the Company
and its Subsidiaries with an opportunity to acquire Common Stock of the Company;
and

      WHEREAS, the Committee has determined that it would be in the best
interests of the Company and its shareholders to grant the Nonstatutory Stock
Option described in this Agreement to the Optionee as an inducement to enter
into or remain in the service of the Company and as an incentive for
extraordinary efforts during such service;

      NOW, THEREFORE, for valuable consideration, the receipt and adequacy of
which is hereby acknowledged, the parties, intending to be legally bound hereby,
agree as follows:

SECTION 1. GRANT OF OPTION.

      (a) Option. On the terms and conditions stated below, the Company hereby
grants to the Optionee the option to purchase _________________________
( _________ ) Shares for the sum of [________] ($[___]) per share. This option
shall not be treated as an Incentive Stock Option.



      (b) Stock Plan. This option is granted pursuant to the Plan, a copy of
which the Optionee acknowledges having received and read. The provisions of the
Plan are incorporated into this Agreement by this reference.

      (c) Grant Condition. The granting of this option shall be subject to
receipt by the Company of the Company's current form of Invention and
Confidentiality Agreement, executed and delivered by the Optionee.

SECTION 2. NO TRANSFER OR ASSIGNMENT OF OPTION.

      Except as otherwise provided in this Agreement, this option and the rights
and privileges conferred hereby shall not be transferred, assigned, pledged or
hypothecated in any way (whether by operation of law or otherwise) and shall not
be subject to sale under execution, attachment or similar process. Upon any
attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this
option, or of any right or privilege conferred hereby, contrary to the
provisions hereof, or upon any attempted sale under any execution, attachment or
similar process upon the rights and privileges conferred hereby, this option and
the rights and privileges conferred hereby shall immediately become null and
void.

SECTION 3. RIGHT TO EXERCISE.

      (a) Vesting. Subject to the conditions stated herein, the right to
exercise this option shall accrue in installments as follows provided the
Optionee has continued to be an Employee through any such applicable date:



                                               Percentage
                                            Shares Exercisable
                                            ------------------
                                         
Date of Grant                                        0%

First Anniversary of
Date of Grant                                       20%


Second Anniversary of
Date of Grant                                       40%


Third Anniversary of
Date of Grant                                       60%

Fourth Anniversary of
Date of Grant                                       80%


                                      -2-



                                                
Fifth Anniversary of
Date of Grant                                      100%


      (b) Periods of Nonexercisability. Any other provision of this Agreement
notwithstanding, the Company shall have the right to designate one or more
periods of time, each of which shall not exceed 18 consecutive months in length,
during which this option shall not be exercisable if the Company determines (in
its sole discretion) that such limitation on exercise could in any way
facilitate a lessening of any restriction on transfer pursuant to the Securities
Act or any state securities laws with respect to any issuance of securities by
the Company, facilitate the registration or qualification of any securities by
the Company under the Securities Act or any state securities laws, or facilitate
the perfection of any exemption from the registration or qualification
requirements of the Securities Act or any applicable state securities laws for
the issuance or transfer of any securities. Such limitation on exercise shall
not alter the vesting of this option as set forth in Section 3(a) other than to
limit the periods during which this option shall be exercisable. The Optionee
shall be notified in writing of any such designation by the Company.

      (c) Shareholder Approval. Any other provision of this Agreement
notwithstanding, this option shall not be exercisable at any time prior to the
approval of the Plan by the holders of a majority of the outstanding stock of
the Company.

      (d) Termination Upon Breach of Certain Agreements. Notwithstanding the
foregoing, if, in the judgment of the Company, the Optionee, prior to the
expiration date of this option, materially violates the non-competition,
non-solicitation, assignment of inventions or confidentiality provisions of any
employment contract, confidentiality and nondisclosure agreement or other
agreement between the Optionee and the Company, the right to exercise this
option shall terminate immediately upon written notice to the Optionee from the
Company describing such violation.

SECTION 4. EXERCISE PROCEDURES.

      (a) Notice of Exercise. The Optionee or the Optionee's representative may
exercise this option by giving written notice to the Secretary of the Company
pursuant to Section 12(d). The notice shall specify the election to exercise
this option, the number of Shares for which it is being exercised, and the form
of payment. The notice shall be signed by the person or persons exercising this
option. In the event that this option is being exercised by the representative
of the Optionee, the notice shall be accompanied by proof (satisfactory to the
Company) of the representative's right to exercise this option. The Optionee or
the Optionee's representative shall deliver to the Secretary of the Company, at
the time of giving the notice, payment in a form permissible under Section 5 for
the full amount of the Purchase Price.

      (b) Issuance of Shares. After receiving a proper notice of exercise, the
Company shall cause to be issued a certificate or certificates for the Shares as
to which this option has been exercised, registered in the name of the person
exercising this option (or in the names of such person and his or her spouse as
community property or as joint tenants with right of

                                      -3-


survivorship). The Company shall cause such certificate or certificates to be
delivered to or upon the order of the person exercising this option.

SECTION 5. PAYMENT FOR STOCK

      The entire Purchase Price may be paid in U.S. dollars. Alternatively, all
or part of the Purchase Price may be paid by the surrender of Shares in good
form for transfer. Such Shares must have been owned for more than 12 months by
the Optionee or the Optionee's representative and must have a fair market value
(as determined by the Committee) on the date of exercise of this option which,
together with any amount paid in cash, is equal to the Purchase Price.

SECTION 6. TERM AND EXPIRATION.

      (a) Basic Term. This option shall in any event expire on the date 10 years
after the Date of Grant.

      (b) Termination of Service (Except by Death). If the Optionee's service as
an Employee terminates for any reason other than death, then this option shall
expire on the earliest of the following occasions:

            (i) The expiration date determined pursuant to Subsection (a) above;

            (ii) The date 60 days after the termination of the Optionee's
      service as an Employee for any reason other than Total and Permanent
      Disability; or

            (iii) The date six months after the termination of the Optionee's
      service as an Employee by reason of Total and Permanent Disability.

The Optionee may exercise all or part of this option at any time before its
expiration under the preceding sentence, but only to the extent that this option
had become exercisable before the Optionee's service terminated. The balance of
this option shall lapse when the Optionee's service as an Employee terminates.
In the event that the Optionee dies after the termination of service but before
the expiration of this option, all or part of this option may be exercised
(prior to expiration) by the executors or administrators of the Optionee's
estate or by any person who has acquired this option directly from the Optionee
by bequest or inheritance, but only to the extent that this option had become
exercisable before the Optionee's service terminated.

      (c) Death of Optionee. If the Optionee dies as an Employee, then this
option shall expire on the earlier of the following dates:

            (i) The expiration date determined pursuant to Subsection (a) above;
      or

                                      -4-


            (ii) The date six months after the Optionee's death.

All or part of this option may be exercised at any time before its expiration
under the preceding sentence by the executors or administrators of the
Optionee's estate or by any person who has acquired this option directly from
the Optionee by bequest or inheritance, but only to the extent that this option
had become exercisable before the Optionee's death. The balance of this option
shall lapse when the Optionee dies.

      (d) Leaves of Absence. For purposes of this Section 6, the Employee
relationship shall be deemed to continue during any period when the Optionee is
on military leave, sick leave or other bona fide leave of absence (to be
determined in the sole discretion of the Committee). However, if the Optionee's
reemployment rights are not guaranteed by statute or by contract, then the
Employee relationship shall not be deemed to continue beyond the 90th day of
such period.

SECTION 7. THE COMPANY'S RIGHT OF FIRST REFUSAL

      (a) Right of First Refusal. In the event that the Optionee or a Transferee
proposes to sell, pledge or otherwise transfer to any person any Shares acquired
under this Agreement, or any interest in such Shares, the Company shall have the
Right of First Refusal with respect to such Shares. If the Optionee or
Transferee desires to transfer Shares acquired under this Agreement, the
Optionee or Transferee shall give a written Transfer Notice to the Company
describing fully the proposed transfer, including the number of Shares proposed
to be transferred, the proposed transfer price and the name and address of the
proposed Transferee. The Transfer Notice shall be signed both by the Optionee or
Transferee and by the proposed new Transferee and must constitute a binding
commitment of both parties to the transfer of the Shares. The Company shall have
the right to purchase the Shares on the terms of the proposal described in the
Transfer Notice (subject, however, to any change in such terms permitted under
Subsection (b) below) by delivery of a notice of exercise of the Right of First
Refusal within in 30 days after the date when the Transfer Notice was received
by the Company. The Company's rights under this Subsection (a) shall be freely
assignable, in whole or in part.

      (b) Transfer of Shares. If the Company fails to exercise its Right of
First Refusal within 30 days after the date when it received the Transfer
Notice, the Optionee or Transferee may, not later than 90 days following receipt
of the Transfer Notice by the Company, conclude a transfer of the Shares subject
to the Transfer Notice on the terms and conditions described in the Transfer
Notice. Any proposed transfer on terms and conditions different from those
described in the Transfer Notice, as well as any subsequent proposed transfer by
the Optionee or Transferee, shall again be subject to the Right of First Refusal
and shall require compliance with the procedure described in Subsection (a)
above. If the Company exercises its Right of First Refusal, the parties shall
consummate the sale of the Shares on the terms set forth in the Transfer Notice;
provided, however, that in the event the Transfer Notice provides that payment
for the Shares is to be made in a form other than lawful money paid at the time
of transfer, the Company shall have the option of paying for the Shares with
lawful money equal to the present value of the consideration described in the
Transfer Notice.

                                      -5-


      (c) Binding Effect. The Company's Right of First Refusal shall inure to
the benefit of its successors and assigns and shall be binding upon any
Transferee of the Shares.

      (d) Termination of Right of First Refusal. Any other provision of this
Section 7 notwithstanding, in the event that Stock is listed on an established
stock exchange or is quoted regularly on the NASDAQ System at the time when the
Optionee or Transferee desires to transfer Shares, the Company shall have no
Right of First Refusal, and the Optionee or Transferee shall have no obligation
to comply with the procedures prescribed by Subsections (a), (b) and (c) above.

SECTION 8. RIGHT OF REPURCHASE.

      (a) Basic Repurchase Right. The Shares acquired under this Agreement shall
be Restricted Shares and shall be subject to the right (but not an obligation)
of repurchase by the Company. The Company's rights under this Subsection (a)
shall be freely assignable, in whole or in part.

      (b) Condition Precedent to Exercise. The Company's right of repurchase
shall be exercisable only during the 60-day period next following the later of
(i) the date when the Optionee ceases to be an Employee for any reason, with or
without cause, including (without limitation) death or disability, or (ii) the
date when the option was exercised by the Optionee, the executors or
administrators of the Optionee's estate or any person who has acquired the
option directly from the Optionee by bequest or inheritance.

      (c) Repurchase Cost. If the Company exercises its right to repurchase, it
shall pay the Optionee an amount equal to (1) the greater of (i) the price per
Share paid by the Optionee under Section 1(a) hereof, or (ii) Fair Market Value
at the time of repurchase multiplied by (2) the number of Restricted Shares to
be repurchased. The Company's right of repurchase shall terminate with respect
to Restricted Shares if the Stock is listed on an established stock exchange or
quoted regularly on the NASDAQ System.

      (d) Exercise of Repurchase Right. If the Company elects to exercise its
right of repurchase with respect to any Restricted Shares, it must exercise its
right of repurchase with respect to all Restricted Shares. The Company's right
of repurchase shall be exercisable only by written notice delivered to the
Optionee prior to the expiration of the 60-day period specified in Subsection
(b) above. The notice shall set forth the date on which the repurchase is to be
effected. Such date shall not be more than 30 days after the date of the notice.
The certificate(s) representing the Restricted Shares to be repurchased shall,
prior to the close of business on the date specified for the repurchase, be
delivered to the Secretary of the Company. Each certificate shall be properly
endorsed for transfer. The Company shall, concurrently with the receipt of such
certificate(s), pay to the Optionee the purchase price determined according to
Subsection (c) above. Payment shall be made in lawful money of the United States
of America. The Company's right of repurchase shall terminate with respect to
any Restricted Shares for which it has not been timely exercised pursuant to
this Subsection (d).

                                      -6-


      (e) Cancellation of Shares. If the Company makes available, at the time
and place and in the amount and form provided in this Agreement, the
consideration for the Restricted Shares to be repurchased in accordance with the
provisions of this Agreement, then after such time the person from whom such
Restricted Shares are to be repurchased shall no longer have any rights as a
holder of such Restricted Shares (other than the right to receive payment of
consideration in accordance with this Agreement). Such Restricted Shares shall
be deemed to have been repurchased in accordance with the applicable provisions
hereof, whether or not the certificate (s) therefor have been delivered as
required by this Agreement.

      (f) Additional Shares or Substituted Securities. In the event of the
declaration of a stock dividend, the declaration of any extraordinary dividend
payable in a form other than stock, a stock split, an adjustment in conversion
ratio, a recapitalization or a similar transaction affecting the Company's
outstanding securities without receipt of consideration, any new, substituted or
additional securities or other property (including money paid other than as an
ordinary cash dividend) that are by reason of such transaction distributed with
respect to any Restricted Shares or into which such Restricted Shares thereby
become convertible, shall immediately be subject to the Company's right of
repurchase. Appropriate adjustments to reflect the distribution of such
securities or property shall be made to the number and/or class of the
Restricted Shares. Appropriate adjustments shall also, after each such
transaction, be made to the price per share to be paid upon the exercise of the
right of repurchase in order to reflect any change in the Company's outstanding
securities effected without receipt of consideration therefor; provided,
however, that the aggregate purchase price payable for the Restricted Shares
shall remain the same.

      (g) Legends. In addition to the legends required by Section 10 (c), all
certificates representing Shares purchased under this Agreement shall be
endorsed with the following legend:

      "THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED, TRANSFERRED,
      ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE
      TERMS OF A WRITTEN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER
      OF THE SHARES (OR THE PREDECESSOR IN INTEREST TO THE SHARES). SUCH
      AGREEMENT GRANTS CERTAIN REPURCHASE RIGHTS TO THE COMPANY UPON TERMINATION
      OF SERVICE WITH THE COMPANY AND CERTAIN RIGHTS OF FIRST REFUSAL UPON AN
      ATTEMPTED TRANSFER OF THE SHARES. THE SECRETARY OF THE COMPANY WILL UPON
      WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENT TO THE HOLDER HEREOF
      WITHOUT CHARGE."

SECTION 9. LEGALITY OF INITIAL ISSUANCE.

                                      -7-


      No Shares shall be issued upon the exercise of this option unless and
until the Company has determined that:

      (a) It and the Optionee have taken any actions required to register the
Shares under the Securities Act or to perfect an exemption from the registration
requirements thereof;

      (b) Any applicable listing requirement of any stock exchange on which
Stock is listed has been satisfied; and

      (c) Any other applicable provision of state or federal law has been
satisfied.

SECTION 10. RESTRICTIONS ON TRANSFER OF SHARES.

      (a) Restrictions. The option granted hereunder is subject to the transfer
restrictions set forth in the Plan. The Optionee shall not sell, transfer,
assign, encumber, hypothecate or otherwise dispose of any Shares except in
accordance with Section 7 and Section 8; provided, however, the Company may
impose additional restrictions upon the sale, pledge or other transfer of such
Shares (including the placement of appropriate legends on stock certificates)
if, in the judgment of the Company and its counsel, such restrictions are
necessary or desirable in order to achieve compliance with the provisions of the
Securities Act, the securities laws of any state or any other law, regardless of
whether the offering and sale of Shares under the Plan have been registered
under the Securities Act or have been registered or qualified under the
securities laws of any state.

      (b) Investment Representations. The Optionee represents, warrants and
covenants that:

            (i) Any Shares purchased upon exercise of this option shall be
acquired for the Optionee's account for investment only and not with a view to,
or for sale in connection with, any distribution of the Shares in violation of
the Securities Act or any rule or regulation under the Securities Act;

            (ii) The Optionee has had such opportunity as the Optionee has
deemed adequate to obtain from representatives of the Company such information
as is necessary to permit the Optionee to evaluate the merits and risks of the
Optionee's investment in the Company;

            (iii) The Optionee is able to bear the economic risk of holding
Shares acquired pursuant to the exercise of this option for an indefinite
period;

            (iv) The Optionee understands that (A) the Shares acquired pursuant
to the exercise of this option will not be registered under the Securities Act
and are "restricted securities" within the meaning of Rule 144 under the
Securities Act; (B) such Shares cannot be sold, transferred or otherwise
disposed of unless they are subsequently registered under the Securities Act or
an exemption from registration is then available; (C) in any event, an exemption
from registration under Rule 144 or otherwise under the Securities Act may not
be available for

                                      -8-


at least one year and even then will not be available unless a public market
then exists for the Stock, adequate information concerning, the Company is then
available to the public and other terms and conditions of Rule 144 are complied
with; and (D) there is now no registration statement on file with the Securities
and Exchange Commission with respect to any Stock of the Company and the Company
has no obligation or current intention to register any Shares acquired pursuant
to the exercise of this option under the Securities Act;

            (v) The Optionee agrees that, if the Company offers for the first
time any of its Stock for sale pursuant to a registration statement under the
Securities Act, the Optionee will not, without the prior written consent of the
Company, publicly offer, sell, contract to sell or otherwise dispose of,
directly or indirectly, any Shares purchased upon exercise of this option for a
period of ninety (90) days, or such longer period as the Company may reasonably
require, after the effective date of such registration statement; and

            (vi) The Optionee's principal residence is at the address set forth
below on the signature page and the Optionee shall promptly notify the Company
of any change in the Optionee's principal address.

By making payment upon any exercise of this option, in whole or in part, the
Optionee shall be deemed to have reaffirmed, as of the date of such payment, the
representations made in this Section 10(b).

      (c) Legend. All certificates evidencing Shares acquired under this
Agreement in an unregistered transaction shall bear the following restrictive
legend (and such other restrictive legends as are required or deemed advisable
under the provisions of any applicable law):

      "THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR
      OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH
      ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL,
      THAT SUCH REGISTRATION IS NOT REQUIRED."

      (d) Removal of Legends. If, in the opinion of the Company and its counsel,
any legend placed on a stock certificate representing Shares sold under this
Agreement is no longer required, the holder of such certificate shall be
entitled to exchange such certificate for a certificate representing the same
number of Shares but lacking such legend.

      (e) Administration. Any determination by the Company and its counsel in
connection with any of the matters set forth in this Section 10 shall be
conclusive and binding on the Optionee and all other persons.

SECTION 11. SHARES AND ADJUSTMENTS.

                                      -9-


      (a) General. In the event of a subdivision of the outstanding Shares, a
declaration of a dividend payable in shares, a declaration of a dividend payable
in a form other than Shares in an amount that has a material effect on the value
of Shares, a combination or consolidation of the outstanding Shares (by
reclassification or otherwise) into a lesser number of Shares, a
recapitalization or a similar occurrence, the Committee shall make appropriate
adjustments in one or both of (i) the number of shares covered by this option or
(ii) the Exercise Price.

      (b) Mergers and Other Reorganizations. In the event that the Company is to
be consolidated with or acquired by another entity in a merger, sale of all or
substantially all of the Company's assets or otherwise, this option shall be
subject to the agreement governing such transaction. Such agreement shall
provide (i) for the assumption of this option by the surviving corporation or
its parent or for its continuation by the Company (if the Company is a surviving
corporation), without the Optionee's consent, (ii) for the acceleration of the
exercisability of this option followed by its cancellation if not exercised,
without the Optionee's consent (and any such cancellation shall not occur
earlier than 30 days after such acceleration is effective and the Optionee has
been notified of such acceleration), (iii) for a limited period of exercise of
this option to the extent then exercisable, without the Optionee's consent, upon
notice to the Optionee, followed by its cancellation if not exercised (and any
such cancellation shall not occur earlier than 30 days after such limited period
of exercise is effective and the Optionee has been notified of such), or (iv)
for the termination of this option in exchange for a cash payment equal to the
difference between the Fair Market Value of one Share (if greater than the
Exercise Price) and the Exercise Price multiplied by the number of Shares
issuable upon exercise of this option, but only with the Optionee's consent.

      (c) Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, the option granted hereunder shall terminate
immediately prior to the consummation of such action or at such other time and
subject to such other conditions as shall be determined by the Committee.

      (d) Reservation of Rights. Except as provided in this Section 11, the
Optionee shall have no rights by reason of any subdivision or consolidation of
shares of stock of any class, the payment of any dividend or any other increase
or decrease in the number of shares of stock of any class. Any issue by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number or Exercise Price of the Shares
subject to this option. The grant of this option shall not affect in any way the
right or power of the Company to make adjustments, reclassifications,
reorganizations or changes of its capital or business structure, to merge or
consolidate or to dissolve, liquidate, sell or transfer all or any part of its
business or assets. Any shares of the capital stock of the Company issued or
issuable to the Optionee pursuant to the foregoing adjustments shall be subject
to the same restrictions imposed on the option granted hereunder and the Shares
issued or issuable upon exercise of such option.

      (e) Fractional Shares. No fractional shares shall be issued under the Plan
and the optionee shall receive from the Company cash in lieu of such fractional
shares.

                                      -10-


SECTION 12. MISCELLANEOUS PROVISIONS.

      (a) Withholding Taxes. In the event that the Company determines that it is
required to withhold foreign, federal, state or local tax as a result of the
exercise of this option, the Optionee, as a condition to the exercise of this
option, shall make arrangements satisfactory to the Company to enable it to
satisfy all withholding requirements. The Optionee shall also make arrangements
satisfactory to the Company to enable it to satisfy any withholding requirements
that may arise in connection with the disposition of Shares purchased by
exercising this option.

      (b) Rights as a Shareholder. Neither the Optionee nor the Optionee's
representative shall have any rights as a shareholder with respect to any Shares
subject to this Option until such Shares have been issued in the name of the
Optionee or the Optionee's representative.

      (c) No Employment Rights. Nothing in this Agreement shall be construed as
giving the Optionee the right to be retained as an Employee. The Company
reserves the right to terminate the Optionee's service at any time, with or
without cause.

      (d) Notice. Any notice required by the terms of this Agreement shall be
given in writing and shall be deemed effective upon personal delivery or upon
deposit with the United States Postal Service, by registered or certified mail
with postage and fees prepaid and addressed to the party entitled to such notice
at the address shown below such party's signature on this Agreement, or at such
other address as such party may designate by 10 days, advance written notice to
the other party to this Agreement.

      (e) Entire Agreement; Severability. This Agreement and the Plan constitute
the entire contract between the parties hereto with regard to the subject matter
hereof. Whenever possible, each provision of this Agreement shall be interpreted
in such a manner as to be effective and valid under applicable law, but if any
provision of this Agreement shall be deemed prohibited or invalid under such
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, and such prohibition or invalidity shall not
invalidate the remainder of such provision or the other provisions of this
Agreement.

      (f) Choice of Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the Commonwealth of Massachusetts, as such laws are
applied to contracts entered into and performed in such Commonwealth.

      (g) Specific Performance. It is specifically understood and agreed that
any breach of the provisions of this Agreement by the Optionee will result in
irreparable injury to the Company, that the remedy at law alone will be an
inadequate remedy for such breach, and that, in addition to any other remedies
which the Company may have, the Company may enforce its rights by actions for
specific performance (to the extent permitted by law). The Company may refuse to
recognize any unauthorized transferee as one of its stockholders for any
purpose, including, without limitation, for purposes of dividend and voting
rights, until the relevant party or parties have complied with all applicable
provisions of this Agreement.

                                      -11-


SECTION 13. DEFINITIONS.

      (a) "Agreement" shall mean this Nonstatutory Stock Option Agreement.

      (b) "Board" shall mean the Board of Directors of the Company, as
constituted from time to time.

      (c) "Code" shall mean the Internal Revenue Code or 1986, as amended.

      (d) "Committee" shall mean the committee of the Board described in Section
3 of the Plan or, if none has been appointed, the full Board.

      (e) "Date of Grant" shall mean the date on which the Committee resolved to
grant this option, which is also the date as of which this Agreement is entered
into.

      (f) "Employee" shall mean (i) any employee of the Company or of a
Subsidiary as determined in accordance with the provisions of Treasury
Regulation Section 1.421-7(h) under the Code or any successor regulations
thereto, (ii) a member of the Board of Directors, (iii) an independent
contractor who performs services for the Company or a Subsidiary, and (iv) any
individual who is employed by any partnership in which the Company has a
substantial partnership interest.

      (g) "Exercise Price" shall mean the amount for which one Share may
purchased upon exercise of this option, as specified in Section 1(a).

      (h) "Fair Market Value" shall mean the fair market value of a Share, as
determined by the Committee in good faith. Such determination shall be
conclusive and binding on all persons.

      (i) "Incentive Stock Option" shall mean an employee incentive stock option
described in section 422(b) of the Code.

      (j) "Nonstatutory Stock Option" shall mean a stock option not described in
section 422(b) or section 423(b) of the Code.

      (k) "Plan" shall mean the 1994 Stock Plan of IRobot Corporation as in
effect on the Date of Grant.

      (1) "Purchase Price" shall mean the Exercise Price multiplied by the
number of Shares with respect to which this option is being exercised.

      (m) "Restricted Share" shall mean a Share which is subject to the
Company's right of repurchase under Section 8.

      (n) "Right of First Refusal" shall mean the Company's right of first
refusal described in Section 7.

                                      -12-


      (o) "Securities Act" shall mean the Securities Act of 1933, as amended.

      (p) "Share" shall mean one share of Stock, as adjusted in accordance with
Section 11 (if applicable).

      (q) "Stock" shall mean the Common Stock of Company.

      (r) "Subsidiary" shall mean any corporation, if the Company and/or one or
more other Subsidiaries own not less than 50% of the total combined voting power
of all classes of outstanding stock of such corporation.

      (s) "Total and Permanent Disability" shall mean that the Optionee is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted, or can be expected to last, for a continuous period
of not less than six months.

      (t) "Transferee" shall mean any person to whom the Optionee has directly
or indirectly transferred any Share acquired under this Agreement.

      (u) "Transfer Notice" shall mean the notice of a proposed transfer of
Shares described in Section 7.

                                      -13-


      IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
on its behalf by its officer duly authorized to act on behalf of the Committee,
and the Optionee has personally executed this Agreement.

OPTIONEE                                         IROBOT CORPORATION

________________________                         By:____________________________
Name:
Optionee's Address:                              Company's Address:

                                                 Twin City Office Center
                                                 Suite #6
                                                 22 McGrath Highway
                                                 Somerville, MA 02143

                                      -14-

                                                                    EXHIBIT 10.8

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY
NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
THEREOF UNDER SUCH ACT AND LAWS OR, SUBJECT TO SECTION 5.3 HEREOF, AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION AND ITS COUNSEL, THAT SUCH
REGISTRATION IS NOT REQUIRED.

                            WARRANT TO PURCHASE STOCK

Issuer iRobot Corporation, a Delaware corporation
Number of Shares 18,000, subject to adjustment
Class of Stock Common Stock, $ 01 par value per share
Exercise Price As set forth below
Issue Date January 30, 2003
Expiration Date January 29, 2010

      FOR THE AGREED UPON VALUE of $1.00, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
this Warrant is issued to SILICON VALLEY BANK (together with its successors and
permitted assigns, "Holder") by iRobot Corporation, a Delaware corporation (the
"Company").

      Subject to the terms and conditions hereinafter set forth, the Holder is
entitled upon surrender of this Warrant and the duly executed subscription form
annexed hereto as Appendix 1, at the office of the Company, 63 South Avenue,
Burlington, Massachusetts 01803 or such other office as the Company shall notify
the Holder of in writing, to purchase from the Company up to Eighteen Thousand
(18,000) fully paid and non-assessable shares (the "Shares") of the Company's
common stock, $ 01 par value per share ("Common Stock") at a purchase price per
Share equal to the Exercise Price (as defined below). This Warrant may be
exercised in whole or in part at any time and from time to time until 5.00 PM,
Eastern time, on the Expiration Date set forth above, and shall be void
thereafter. Until such time as this Warrant is exercised in full or expires, the
Exercise Price and the Shares are subject to adjustment from time to time as
hereinafter provided.

      As used herein:

      "Additional Common Shares" means all Common Stock (including reissued
shares) Issued (or deemed to be issued pursuant to Section 2.5(j)) after the
Issue Date. Additional Common Shares does not include, however, any Common Stock
Issued in a transaction described in Sections 2.1 and 2.2 below, any Common
Stock Issued upon conversion of Options

                                      -1-


and Convertible Securities outstanding as of the Issue Date, the Shares, or
Options or Common Stock Issued pursuant to a stock option plan approved by the
Board of Directors of the Company as an incentive to, or in a nonfinancing
transaction to, employees, officers, directors, or consultants to the Company.

      "Convertible Securities" means any evidences of indebtedness, shares of
stock, or other securities directly or indirectly convertible into or
exchangeable for Common Stock.

      "Exercise Price" means either (a) $3.7415 (as adjusted from time to time
in accordance with the provisions hereof, the "Prior Round Price"), or (b) if a
Qualified Financing occurs prior to June 30, 2003, from and after the
consummation of the Qualified Financing, the lesser of (i) the Prior Round Price
and (ii) the Qualified Financing Price.

      "Issue" means to grant, issue, sell, assume, or fix a record date for
determining persons entitled to receive, any security (including Options),
whichever of the foregoing is the first to occur.

      "Option" means any right, option, or warrant to subscribe for, purchase,
or otherwise acquire Common Stock or Convertible Securities.

      "Qualified Financing" means the first sale and issuance by the Company
after the Issue Date of this Warrant, in a single transaction or series of
related transactions, of shares of its convertible preferred stock or other
senior convertible equity securities to one or more investors for financing
purposes resulting in gross proceeds to the Company of at least $5,000,000.

      "Qualified Financing Price" means the lesser of (a) the lowest price per
share for which shares of Qualified Financing Securities are sold or issued by
the Company in connection with the Qualified Financing, and (b) if options,
warrants or other rights to purchase, subscribe for or acquire Qualified
Financing Securities are sold or issued by the Company in connection with the
Qualified Financing, the lowest exercise, purchase, subscription or other
acquisition price payable to the Company for one share of Qualified Financing
Securities under any such option, warrant or other right to purchase, subscribe
for or otherwise acquire shares of Qualified Financing Securities.

      "Qualified Financing Securities" means the class and/or series of
convertible preferred stock or other senior equity security sold or issued by
the Company in the Qualified Financing.

ARTICLE 1. EXERCISE.

            1.1. Method of Exercise. Holder may exercise this Warrant by
delivering a duly executed Notice of Exercise in substantially the form attached
as Appendix 1 to the principal office of the Company. Unless Holder is
exercising the conversion right set forth in

                                      -2-


Section 1.2, Holder shall also deliver to the Company a check for the aggregate
Exercise Price for the Shares being purchased.

            1.2. Conversion Right. In lieu of exercising this Warrant as
specified in Section 1.1, Holder may from time to time convert this Warrant, in
whole or in part, into a number of Shares determined as follows:

                     X = Y (A-B)/A
          where
                     X = the number of Shares to be issued to the Holder

                     Y = the number of Shares with respect to which this
                     Warrant is being exercised

                     A = the Fair Market Value (as determined pursuant to
                     Section 1.3 below) of one Share

                     B = the Exercise Price

            1.3. Fair Market Value.

                  1.3.1. If shares of Common Stock are traded on a nationally
recognized securities exchange or over the counter market, the fair market value
of one Share shall be the closing price of a share of Common Stock reported for
the business day immediately preceding the date of Holder's Notice of Exercise
to the Company.

                  1.3.2. If shares of Common Stock are not traded on a
nationally recognized securities exchange or over the counter market, the Board
of Directors of the Company shall determine the fair market value of a share of
Common Stock in its reasonable good faith judgment.

            1.4. Delivery of Certrficate and New Warrant. Promptly after Holder
exercises or converts this Warrant, the Company shall deliver to Holder
certificates for the Shares acquired and, if this Warrant has not been fully
exercised or converted and has not expired, a new Warrant representing the right
to purchase the Shares not so acquired.

            1.5. Replacement of Warrants. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of loss, theft or destruction, on delivery of an
indemnity agreement reasonably satisfactory in form and amount to the Company
or, in the case of mutilation, on surrender and cancellation of this Warrant,
the Company at its expense shall execute and deliver, in lieu of this Warrant, a
new warrant of like tenor.

                                      -3-


            1.6. Assumption on Sale, Merger, or Consolidation of the
Company.

                  1.6.1. "Acquisition". For the purpose of this Warrant,
"Acquisition" means any sale, transfer, exclusive license, or other disposition
of all or substantially all of the assets of the Company, or any acquisition,
reorganization, consolidation or merger of the Company where the holders of the
Company's outstanding voting equity securities immediately prior to the
transaction beneficially own less than a majority of the outstanding voting
equity securities of the surviving or successor entity immediately following the
transaction.

                  1.6.2. In connection with, and upon the closing of, any
Acquisition (other than an Acquisition in which the consideration received by
the Company's stockholders consists solely of cash), and as a condition
precedent thereto, the successor or surviving entity shall assume the
obligations of this Warrant, and this Warrant thereafter shall be exercisable
for the same kind and amount of securities and other property as would be
payable for the Shares issuable upon exercise of the unexercised portion of this
Warrant as if such Shares were outstanding on the record date for the
Acquisition and subsequent closing. The Exercise Price shall be adjusted such
that the product of (i) the Exercise Price in effect immediately prior to the
closing of such Acquisition, and (ii) the number of Shares then issuable upon
exercise of this Warrant, equals the product of (i) the number of shares or
other securities or property for which this Warrant shall be exercisable
immediately following the closing of such Acquisition, and (ii) the Exercise
Price in effect immediately following the closing of such Acquisition, and the
Exercise Price and number and class of Shares shall continue to be subject to
adjustment from time to time in accordance with the provisions hereof.

ARTICLE 2. ADJUSTMENTS TO THE SHARES.

            2.1. Stock Dividends, Splits, Etc. If the Company declares or pays a
dividend on the outstanding shares of Common Stock, payable in Common Stock or
other securities, or subdivides the outstanding Common Stock into a greater
amount of Common Stock, then upon exercise of this Warrant, for each Share
acquired, Holder shall receive, without cost to Holder, the total number and
kind of securities to which Holder would have been entitled had Holder owned the
Shares of record as of the date the dividend or subdivision occurred.

            2.2. Reclassification, Exchange or Substitution. Upon any
reclassification, exchange, substitution, or other event that results in a
change of the number and/or class of the securities issuable upon exercise or
conversion of this Warrant, Holder shall be entitled to receive, upon exercise
or conversion of this Warrant, the number and kind of securities and property
that Holder would have received for the Shares if this Warrant had been
exercised immediately before such reclassification, exchange, substitution, or
other event. The Company or its successor shall promptly issue to Holder a new
Warrant for such new securities or other property. The new Warrant shall provide
for adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article 2 including, without limitation,
adjustments to the Exercise Price and to the number of securities or property
issuable upon

                                      -4-


exercise of the new Warrant. The provisions of this Section 2.2 shall similarly
apply to successive reclassifications, exchanges, substitutions, or other
events.

            2.3. Adjustments for Combinations, Etc. If the outstanding shares of
Common Stock are combined or consolidated, by reclassification or otherwise,
into a lesser number of shares, the Exercise Price shall be proportionately
increased and the number of Shares shall be proportionately decreased.

            2.4. No Impairment. The Company shall not, by amendment of its
Certificate of Incorporation or by-laws, or through a reorganization, transfer
of assets, consolidation, merger, dissolution, issue, or sale of securities or
any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms to be observed or performed under this Warrant by the
Company, but shall at all times in good faith assist in carrying out of all the
provisions of this Article 2 and in taking all such action as may be necessary
or appropriate to protect Holder's rights under this Article against impairment.

            2.5. Adjustments for Diluting Issuances.

      (a) Weighted Average Adjustment. If the Company issues Additional Common
Shares after the Issue Date and the consideration per Additional Common Share
(determined pursuant to subsection (i) below) is less than the Exercise Price in
effect immediately before such Issue (a "Diluting Issuance"), the Exercise Price
shall be reduced, concurrently with such Issue, to a price (calculated to the
nearest hundredth of a cent) determined by multiplying the Exercise Price by a
fraction.

            (i) the numerator of which is the number of shares of Common Stock
outstanding immediately before such Issue plus the number of shares of Common
Stock that the aggregate consideration received by the Company for the
Additional Common Shares would purchase at the Exercise Price in effect
immediately before such Issue, and

            (ii) the denominator of which is the number of shares of Common
Stock outstanding immediately before such Issue plus the number of such
Additional Common Shares.

      (b) Adjustment to Number of Shares. Upon each adjustment of the Exercise
Price, the number of Shares issuable upon exercise of the Warrant shall be
increased to equal the quotient obtained by dividing (a) the product resulting
from multiplying (i) the number of Shares issuable upon exercise of the Warrant
and (ii) the Exercise Price, in each case as in effect immediately before such
adjustment, by (b) the adjusted Exercise Price.

      (c) Securities Deemed Outstanding. For the purpose of this Section 2.5,
all securities issuable upon exercise of any outstanding Convertible Securities
or Options, warrants, or other rights to acquire securities of the Company shall
be deemed to be outstanding.

                                      -5-


      (d) No Adjustment for Issuances Following Deemed Issuances. No adjustment
to the Exercise Price shall be made upon the exercise of Options or conversion
of Convertible Securities.

      (e) Adjustment Following Changes in Terms of Options or Convertible
Securities. If the consideration payable to, or the amount of Common Stock
Issuable by, the Company increases or decreases, respectively, pursuant to the
terms of any outstanding Options or Convertible Securities, the Exercise Price
shall be recomputed to reflect such increase or decrease. The recomputation
shall be made as of the time of the Issuance of the Options or Convertible
Securities. Any changes in the Exercise Price that occurred after such Issuance
because other Additional Common Shares were Issued or deemed Issued shall also
be recomputed.

      (f) Recomputation Upon Expiration of Options or Convertible Securities.
The Exercise Price computed upon the original Issue of any Options or
Convertible Securities, and any subsequent adjustments based thereon, shall be
recomputed when any Options or rights of conversion under Convertible Securities
expire without having been exercised. In the case of Convertible Securities or
Options for Common Stock, the Exercise Price shall be recomputed as if the only
Additional Common Shares Issued were the shares of Common Stock actually Issued
upon the exercise of such Securities, if any, and as if the only consideration
received therefor was the consideration actually received upon the Issue,
exercise or conversion of the Options or Convertible Securities. In the case of
Options for Convertible Securities, the Exercise Price shall be recomputed as if
the only Convertible Securities Issued were the Convertible Securities actually
Issued upon the exercise thereof, if any, and as if the only consideration
received therefor was the consideration actually received by the Company
(determined pursuant to subsection (i)), if any, upon the Issue of the Options
for the Convertible Securities.

      (g) Limit on Readjustments. No readjustment of the Exercise Price pursuant
to Sections (e) or (f) shall increase the Exercise Price by more than the amount
of any decrease made in respect of the Issue of any Options or Convertible
Securities with respect to which such readjustment is made.

      (h) 30 Day Options. In the case of any Options that expire by their terms
not more than 30 days after the date of Issue thereof, no adjustment of the
Exercise Price shall be made until the expiration or exercise of such Options.

      (i) Computation of Consideration. The consideration received by the
Company for the Issue of any Additional Common Shares shall be computed as
follows.

            (i) Cash. shall be valued at the amount of cash received by the
Company, excluding amounts paid or payable for accrued interest or accrued
dividends.

                                      -6-


            (ii) Property. Property other than cash shall be computed at the
fair market value thereof at the time of the Issue as determined in good faith
by the Board of Directors of the Company.

            (iii) Mixed Consideration. The consideration for Additional Common
Shares Issued together with other property of the Company for consideration that
covers both shall be determined in good faith by the Board of Directors.

            (iv) Options and Convertible Securities. The consideration per
Additional Common Share for Options and Convertible Securities shall be
determined by dividing.

                  (x) the total amount, if any, received or receivable by the
Company for the Issue of the Options or Convertible Securities, plus the minimum
amount of additional consideration (as set forth in the instruments relating
thereto, without regard to any provision contained therein for a subsequent
adjustment of such consideration) payable to the Company upon exercise of the
Options or conversion of the Convertible Securities, by

                  (y) the maximum amount of Common Stock (as set forth in the
instruments relating thereto, without regard to any provision contained therein
for a subsequent adjustment of such number) ultimately issuable upon the
exercise of such Options or the conversion of such Convertible Securities.

      (j) Deemed Issuance of Additional Common Shares. The shares of Common
Stock ultimately issuable upon exercise of an Option (including the shares of
Common Stock ultimately issuable upon conversion or exercise of a Convertible
Security issuable pursuant to an Option) are deemed to be Issued when the Option
is Issued. The shares of Common Stock ultimately issuable upon conversion or
exercise of a Convertible Security (other than a Convertible Security Issued
pursuant to an Option) shall be deemed Issued upon Issuance of the Convertible
Security. The maximum amount of Common Stock issuable is determined without
regard to any future adjustments permitted under the instrument creating the
Options or Convertible Securities.

            2.6. Fractional Shares. No fractional Shares shall be issuable upon
exercise or conversion of the Warrant and the number of Shares to be issued
shall be rounded down to the nearest whole Share. If a fractional Share interest
arises upon any exercise or conversion of this Warrant, the Company shall
eliminate such fractional Share interest by paying Holder an amount computed by
multiplying such fractional interest by the Fair Market Value (determined in
accordance with Section 1.3 above) of one Share.

            2.7. Certificate as to Adjustments. Upon each adjustment of the
Exercise Price, number of Shares or class of security for which this Warrant is
exercisable, the Company at its expense shall promptly compute such adjustment,
and furnish Holder with a certificate of

                                      -7-


its chief financial officer setting forth such adjustment and the facts upon
which such adjustment is based. The Company shall, upon written request, furnish
Holder a certificate setting forth the Exercise Price, number of Shares and
class of security for which this Warrant is exercisable in effect upon the date
thereof and the series of adjustments leading to such Exercise Price, number of
Shares and class of security.

ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

            3.1. Representations and Warranties. The Company hereby represents
and warrants to the Holder as follows.

                  (a) All Shares which may be issued upon the due exercise of
this Warrant shall, upon issuance, be duly authorized, validly issued, fully
paid and non-assessable, and free of any liens and encumbrances except for
restrictions on transfer provided for herein or under applicable federal and
state securities laws.

                  (b) The Company covenants that it shall at all times cause to
be reserved and kept available out of its authorized and unissued shares such
number of shares of its Common Stock and other securities as will be sufficient
to permit the exercise in full of this Warrant and the conversion or exchange of
such Common Stock into or for such other securities.

                  (c) On and as of the date hereof, (i) $3.7415 is the lowest
price per share for which shares of the Company's Series D Convertible Preferred
Stock, $ 01 par value per share ("Series D Stock"), have been sold or issued by
the Company, and the lowest exercise or conversion price per share for which
shares of Series D Stock may be purchased or acquired upon the exercise or
conversion of outstanding securities exercisable or convertible by their terms
for shares of Series D Stock, and (ii) the Common Stock conversion price in
effect for shares of Series D Stock as determined pursuant to the Company's
Certificate of Incorporation, as amended, is $3.7415.

            3.2. Notice of Certain Events. If the Company proposes at any time
(a) to declare any dividend or distribution upon its outstanding Common Stock,
whether in cash, property, stock, or other securities and whether or not a
regular cash dividend, (b) to offer for subscription pro rata to the holders of
Common Stock any additional shares of stock of any class or series or other
rights, (c) to effect any reclassification or recapitalization of any of its
securities, or (d) to merge or consolidate with or into any other corporation,
or sell, lease, license, or convey all or substantially all of its assets, or to
liquidate, dissolve or wind up, then, in connection with each such event, the
Company shall give Holder (1) at least 10 days prior written notice of the date
on which a record will be taken for such dividend, distribution, or subscription
rights (and specifying the date on which the holders of securities of the
Company shall be entitled to receive such dividend, distribution or rights) or
for determining rights to vote, if any, in respect of the matters referred to in
(c) and (d) above, and (2) in the case of the matters referred to in (c) and (d)
above at least 10 days prior written notice of the date when the same

                                      -8-


will take place (and specifying the date on which the holders of securities of
the Company will be entitled to exchange their securities of the Company for
securities or other property deliverable upon the occurrence of such event).

            3.3. Registration Under Securities Act of 1933, as amended. The
Shares issued and issuable hereunder shall have certain incidental or
"piggyback" registration rights pursuant to, and as set forth in, that certain
Third Amended and Restated Registration Rights Agreement dated as of August 24,
2001 among the Company and the other parties named therein (the "Registration
Rights Agreement"). The Company shall execute and deliver an amendment or
joinder agreement with Holder for the purpose of effecting the foregoing grant
of registration rights. The Company represents and warrants to Holder that the
Company's foregoing grant of registration rights and its execution, delivery and
performance of the aforementioned amendment or joinder agreement (a) have been
duly authorized by all necessary corporate action of the Company's Board of
Directors and shareholders, (b) will not violate the Certificate or the
Company's by-laws, each as amended, (c) will not violate or cause a breach or
default (or an event which with the passage of time or the giving of notice or
both, would constitute a breach or default) under any agreement, instrument,
mortgage, deed of trust or other arrangement to which the Company is a party or
by which it or any of its assets is subject or bound, and (d) do not require the
approval, consent or waiver of or by any shareholder, registration rights holder
or other third party which approval, consent or waiver has not been obtained as
of the date of issuance of this Warrant.

ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF THE HOLDER.

            4.1. Purchase for Own Account. Except for transfers to Holder's
affiliates, this Warrant and the Shares to be acquired upon exercise hereof will
be acquired for investment for Holder's account, not as nominee or agent, and
not with a view to sale or distribution in violation of applicable federal and
state securities laws.

            4.2. Investment Experience. Holder understands that the purchase of
this Warrant and the Shares covered hereby involves substantial risk Holder (a)
has experience as an investor in unregistered securities, (b) has sufficient
knowledge and experience in financial and business affairs that it can evaluate
the risks and merits of its investment in this Warrant and the Shares, and (c)
can bear the economic risk of such Holder's investment in this Warrant and the
Shares.

            4.3. Accredited Investor. Holder is an "accredited investor" as such
term is defined in Regulation D under the Securities Act of 1933, as amended.

ARTICLE 5. MISCELLANEOUS.

            5.1. Automatic Conversion upon Expiration. In the event that, upon
the Expiration Date, the Fair Market Value of one Share (or other security
issuable upon the

                                      -9-


exercise hereof) as determined in accordance with Section 1.3 above is greater
than the Exercise Price in effect on such date, then this Warrant shall
automatically be deemed on and as of such date to be converted pursuant to
Section 1.2 above as to all Shares (or such other securities) for which it shall
not previously have been exercised or converted, and the Company shall promptly
deliver a certificate representing the Shares (or such other securities) issued
upon such conversion to the Holder.

            5.2. Legends. This Warrant and the Shares shall be imprinted with a
legend in substantially the following form.

      THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
      AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE SOLD, PLEDGED OR
      OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH
      ACT AND LAWS OR, SUBJECT TO SECTION 5.3 OF THAT CERTAIN WARRANT TO
      PURCHASE STOCK ISSUED BY THE CORPORATION TO SILICON VALLEY BANK DATED AS
      OF 1/30/03, AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
      CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.

            5.3. Compliance with Securities Laws on Transfer. This Warrant and
the Shares may not be transferred or assigned in whole or in part without
compliance with applicable federal and state securities laws by the transferor
and the transferee (including, without limitation, the delivery of investment
representation letters and legal opinions reasonably satisfactory to the
Company, as reasonably requested by the Company) The Company shall not require
Holder to provide an opinion of counsel if the transfer is to Silicon Valley
Bancshares or other affiliate of Silicon Valley Bank.

            5.4. Transfer Procedure. Following its receipt of this executed
Warrant, Silicon Valley Bank will transfer same in whole or in part to its
parent corporation Silicon Valley Bancshares, and thereafter Holder and/or
Silicon Valley Bancshares may, subject to Section 5.3 above, transfer all or
part of this Warrant and/or the Shares at any time and from time to time by
giving the Company notice of the portion of the Warrant and/or Shares being
transferred setting forth the name, address and taxpayer identification number
of the transferee and surrendering this Warrant to the Company for reissuance to
the transferee(s) (and Holder if applicable), provided, that at all times prior
to the Company's IPO, Holder shall not, without the prior written consent of the
Company, transfer this Warrant (or any part hereof) or any Shares to any person
who directly competes with the Company, unless such transfer is in connection
with an Acquisition of the Company by any such person.

            5.5. Notices. All notices and other communications from the Company
to the Holder, or vice versa, shall be deemed delivered and effective when given
personally, or mailed by first-class registered or certified mail, postage
prepaid, or sent via reputable overnight courier

                                      -10-


service, fee prepaid, at such address as may have been furnished to the Company
or the Holder, as the case may be, in writing by the Company or such holder from
time to time, but in all cases, unless instructed in writing otherwise, the
Company shall deliver a copy of all notices to Holder to Silicon Valley Bank,
Treasury Department, 3003 Tasman Drive, HA 200, Santa Clara, California 95054.

            5.6. Waiver. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought.

            5.7. Attorneys Fees. In the event of any dispute between the parties
concerning the terms and provisions of this Warrant, the party prevailing in
such dispute shall be entitled to collect from the other party all costs
incurred in such dispute, including reasonable attorneys' fees.

            5.8. Governing Law. This Warrant shall be governed by and construed
in accordance with the laws of The Commonwealth of Massachusetts, without giving
effect to its principles regarding conflicts of law.

            5.9. No Rights as a Shareholder. Except as specifically provided in
this Warrant, Holder shall have no rights as a shareholder of the Company in
respect of the Shares issuable hereunder unless and until Holder exercises this
Warrant as to all or any of such Shares.

                  [REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]

                                      -11-


      IN WITNESS WHEREOF, the Company has caused this Warrant to Purchase Stock
to be executed as an instrument under seal by its duly authorized representative
as of the date first above written.

ATTEST                                         "COMPANY"

                                               iROBOT CORPORATION

By /s/ Colin Angle                          By /s/ Helen Greiner
   ---------------------------                 ------------------------------
Name  Colin Angle                              Name Helen Greiner
Title CEO                                      Title President

                                      -12-


                                   APPENDIX 1

                               NOTICE OF EXERCISE

      1. The undersigned hereby elects to purchase _______ shares of
the __________ stock of ___________________ pursuant to Section 1.1 of the
attached Warrant, and tenders herewith payment of the Exercise Price of such
shares in full.

      1. The undersigned hereby elects to convert the attached Warrant into
Shares in the manner specified in Section 1.2 of the attached Warrant. This
conversion is exercised with respect to __________ of shares of the
_____________________ Stock of ______________.

      [Strike paragraph that does not apply]

      2. Please issue a certificate or certificates representing said shares in
the name of the undersigned or in such other name as is specified below.

                       _______________________________________
                            (Name)

                       _______________________________________

                       _______________________________________
                            (Address)

      3. The undersigned represents it is acquiring the shares solely for its
own account and not as a nominee for any other party and not with a view toward
the resale or distribution thereof except in compliance with applicable
securities laws.

                                               ________________________________
                                                    (Signature)
________________
    (Date)



                                   ASSIGNMENT

FOR VALUE RECEIVED, SILICON VALLEY BANK HEREBY SELLS, ASSIGNS AND TRANSFERS UNTO

                       NAME SILICON VALLEY BANCSHARES
                       ADDRESS 3003 TASMAN DRIVE (HA-200)
                       SANTA CLARA, CA 95054

                       TAX ID 91-1962278

THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED BY IROBOT CORPORATION (THE
"COMPANY"), ON JANUARY 30, 2003 (THE "WARRANT") TOGETHER WITH ALL RIGHTS, TITLE
AND INTEREST THEREIN.

                                           SILICON VALLEY BANK

                                           By /s/ Dave Reich
                                              ---------------------------

                                           Name Dave Reich

                                           Title SVP

Date 2/3/03

By its execution below, and for the benefit of the Company, Silicon Valley
Bancshares makes each of the representations and warranties set forth in Article
4 of the Warrant as of the date hereof.

                                           SILICON VALLEY BANCSHARES

                                           By /s/ Paulette Mehas
                                              --------------------------
                                           Name Paulette Mehas
                                           Title Treasurer

                                                                    EXHIBIT 10.9

                               FLEET NATIONAL BANK
                            A Bank of America Company

                           LOAN AND SECURITY AGREEMENT

                                                                    May 26, 2005

      1. SECURITY INTEREST. i Robot Corporation, a Delaware corporation with
its principal office located at 63 South Avenue, Burlington, Massachusetts
01803-4903 (hereinafter referred to as the "BORROWER"), for valuable
consideration, receipt whereof is hereby acknowledged, hereby grants to Fleet
National Bank, a Bank of America company, a national banking association, with
an office located at 100 Federal Street, Boston, Massachusetts 02110, the
secured party hereunder (hereinafter called the "Bank"), a continuing security
interest in and to, and assigns to Bank, all assets of the Borrower, wherever
located and whether now owned or hereafter acquired, including, without
limitation, the following:

            (a) all inventory, including all goods, merchandise, raw materials
and work in process, finished goods, and other tangible personal property now
owned or hereafter acquired and held for sale or lease or furnished or to be
furnished under contracts of service or used or consumed in Borrower's business
(all hereinafter called the "Inventory"),

            (b) all accounts (as defined in Article 9 of the Uniform Commercial
Code, hereinafter "Accounts"), contracts, contract rights, notes, bills, drafts,
acceptances, general intangibles (including without limitation, customer lists,
goodwill, computer programs, computer records, computer software, computer data,
ledger sheets, files, records, data processing records relating to any Accounts
and all tax refunds of every kind and nature to which Borrower is now or
hereafter may become entitled to, no matter how arising, but excluding
Intellectual Property (as defined below)), instruments, documents, chattel paper
(whether tangible or electronic) deposit accounts, letter of credit rights
(whether or not the letter of credit is evidenced by a writing), securities,
security entitlements, security accounts, investment property, supporting
obligations, choses in action, commercial tort claims, and all other debts,
obligations and liabilities in whatever form, owing to Borrower from any person,
firm or corporation or any other legal entity, whether now existing or hereafter
arising, now or hereafter received by or belonging or owing to Borrower, for
goods sold by it or for services rendered by it, or however otherwise same may
have been established or created, all guarantees and securities therefor, all
right, title and interest of Borrower in the merchandise or services which gave
rise thereto, including the rights of reclamation and stoppage in

                                       1


transit, all rights to replevy goods, and all rights of an unpaid seller of
merchandise or services (all hereinafter called the "Receivables"),

            (c) all machinery, equipment, fixtures and other goods (as defined
in Article 9 of the Uniform Commercial Code) purchased with the proceeds of the
Equipment Loan (as defined below) whether now owned or hereafter acquired by the
Borrower and wherever located, all replacements and substitutions therefor or
accessions thereto and all proceeds thereof (all hereinafter called the
"Equipment"), and

            (d) all proceeds and products of all of the foregoing in any form,
including, without limitation, all proceeds of credit, fire or other insurance,
and also including, without limitation, rents and profits resulting from the
temporary use of any of the foregoing (which, with Inventory, Receivables and
Equipment are all hereinafter called "Collateral"),

provided, however, that notwithstanding the foregoing, Collateral shall not
include any right, title or interest of Borrower in or to any patents,
trademarks, service marks, tradenames, copyrights, mask works, trade secrets or
know-how, or any registrations, applications, or applications for registration
of or relating to any of the foregoing ("Intellectual Property").

      2. OBLIGATIONS SECURED. The security interest granted hereby is to secure
payment and performance of all debts, liabilities and obligations of Borrower to
Bank hereunder and also any and all other debts, liabilities and obligations of
Borrower to Bank of every kind and description, direct or indirect, absolute or
contingent, primary or secondary, due or to become due, now existing or
hereafter arising, whether or not such obligations are related to the
transactions described in this Agreement, by class, or kind, or whether or not
contemplated by the parties at the time of the granting of this security
interest, regardless of how they arise or by what agreement or instrument they
may be evidenced or whether evidenced by any agreement or instrument, and
includes obligations to perform acts and refrain from taking action as well as
obligations to pay money including, without limitation, all interest, fees,
charges, expenses and overdrafts, and also including, without limitation, all
obligations and liabilities which Bank may incur or become liable for, on
account of, or as a result of, any transactions between Bank and Borrower
including any which may arise out of any letter of credit, acceptance or similar
instrument or obligation issued or caused to be pursuant to this Agreement (all
hereinafter called "Obligations").

      3. BORROWER'S PLACES OF BUSINESS, INVENTORY LOCATIONS AND RETURNS POLICY.
Borrower warrants that Borrower has no places of business other than that shown
at the end of this Agreement, unless other places of business are listed on
Schedule "A", annexed hereto, in which event Borrower represents that it has
additional places of business at those locations set forth on Schedule "A".

                                       2


            Borrower's principal executive office and the office where Borrower
keeps its records concerning its accounts, contract rights and other property,
is that shown at the end of this Agreement, All Inventory presently owned by
Borrower is stored at the locations set forth on Schedule "A".

            Borrower will promptly notify Bank in writing of any change in the
location of any place of business or the establishment of any new place of
business or location of Inventory or office where its records are kept which
would be shown in this Agreement if it were executed after such change.

            Borrower represents and warrants that it has described its returns
policy in writing to Bank and that it does now, and will continue to, apply such
policy consistently in the conduct of its business and agrees that it shall
notify Bank in writing before changing its policy or the application thereof.

      4. BORROWER'S ADDITIONAL REPRESENTATIONS AND WARRANTIES. Borrower
represents and warrants that

            (a) Borrower is a corporation duly organized, validly existing and
in good standing under the laws of the state of Delaware and shall hereafter
remain in good standing as a corporation in that state, and is duly qualified
and in good standing in every other state in which it is doing business, and
shall hereafter remain duly qualified and in good standing in every other state
in which the failure to qualify or become licensed could reasonably be expected
to have a material adverse effect on the business or financial condition of the
Borrower.

            (b) Borrower's exact legal name is as set forth in this Agreement.

            (c) The organizational identification number of the Borrower is as
set forth on Schedule "A" annexed hereto.

            (d) The execution, delivery and performance of this Agreement, and
any other document executed in connection herewith, are within the Borrower's
corporate powers, have been duly authorized, are not in contravention of law or
the terms of the Borrower's charter, by-laws or other incorporation papers, or
of any indenture, agreement or undertaking to which the Borrower is a party or
by which it or any of its properties may be bound.

            (e) The Certificate of Incorporation and all amendments thereto of
Borrower have been duly filed and are in proper order. All capital stock issued
by Borrower and outstanding was and is properly issued and all books and records
of Borrower, including but not limited to its minute books, by-laws and books of
account, are accurate and up to date and will be so maintained.

            (f) Borrower owns all of the assets reflected in the most recent of
Borrower's financial statements provided to Bank, except assets sold or
otherwise disposed of in the ordinary

                                       -3-


course of business since the date thereof, and such assets together with any
assets acquired since such date, including without limitation the Collateral,
are free and clear of any lien, pledge, security interest, charge, mortgage or
encumbrance of any nature whatsoever, except (i) the security interests and
other encumbrances (if any) listed on Schedule "B" annexed hereto, (ii) those
leases of personal property set forth on Schedule "C" annexed hereto, (iii)
those liens permitted pursuant to Section 17(h) of this Agreement, or (iv) liens
and security interests in favor of Bank.

            (g) Borrower has made or filed all tax returns, reports and
declarations relating to any material tax liability required by any jurisdiction
to which it is subject (any tax liability which may result in a lien on any
Collateral being hereby deemed material), has paid all taxes shown or determined
to be due thereon except those being contested in good faith and which Borrower
has, prior to the date of such contest, identified in writing to Bank as being
contested, and has made adequate provision for the payment of all taxes so
contested, so that no lien will encumber any Collateral, and in respect of
subsequent periods.

            (h) Borrower (i) is subject to no charter, corporate or other legal
restriction, or any judgment, award, decree, order, governmental rule or
regulation or contractual restriction which could reasonably be expected to have
a material adverse effect on its business or financial condition, and (ii) is in
compliance with its charter documents and by-laws, all contractual requirements
by which it or any of its properties may be bound and all applicable laws, rules
and regulations (including without limitation those relating to environmental
protection) other than laws, rules or regulations the validity or applicability
of which it is contesting in good faith or provisions of any of the foregoing
the failure to comply with which cannot reasonably be expected to materially
adversely affect its business or financial condition or the value of the
Collateral.

            (i) There is no action, suit, proceeding or investigation pending
or, to Borrower's knowledge, threatened against or affecting it or any of its
assets before or by any court or other governmental authority which, if
determined adversely to it, would have a material adverse effect on its business
or financial condition or the value of the Collateral.

            (j) Borrower is in compliance with ERISA, no Reportable Event has
occurred and is continuing with respect to any Plan, and it has no unfunded
vested liability under any Plan. The word "Plan" as used in this Agreement means
any employee plan subject to Title IV of the Employee Retirement Income Security
Act of 1974 ("ERISA") maintained for employees of Borrower, any subsidiary of
Borrower or any other trade or business under common control with Borrower
within the meaning of Section 414(c) of the Internal Revenue Code of 1986 or any
regulations thereunder.

      5. LINE OF CREDIT AND OTHER FINANCIAL ACCOMMODATIONS

            (a) Subject to the terms and provisions of this Agreement, Bank
hereby establishes a revolving line of credit (the "Line of Credit") in
Borrower's favor in the amount of the Credit Limit (as defined below). From time
to time upon Borrower's request, so long as the sum of

                                       -4-


the aggregate principal amount of all loans outstanding and the requested loan
does not exceed the lesser of (i) if the amount outstanding under the Line of
Credit exceeds Six Million Dollars ($6,000,000 00), the Borrowing Base (as
defined below), or (ii) the Credit Limit (as defined below), Bank shall make
such requested loan, provided that there has not occurred and is continuing an
Event of Default or an event which, with notice or the lapse of time or both,
would constitute an Event of Default.

            (b) All loans shall bear interest and at the option of the Bank
shall be evidenced by and repayable in accordance with a revolving note drawn to
the order of Bank substantially the form of Exhibit 1 hereto (the "Master
Note"), as the same may hereafter be amended, supplemented or restated from time
to time and any note or notes issued in substitution therefor, but in the
absence of the Note shall be conclusively evidenced by Bank's records of loans
and repayments.

            Interest, net of those loans (if any) which bear interest calculated
by reference to LIBOR (as defined below), will be charged to Borrower at a
fluctuating rate which is the daily equivalent to a rate equal to the aggregate
of (x) the Prime Rate, minus (y) one (1.0%) percent per annum, or at such other
rate agreed on from time to time by the parties, upon any balance owing to Bank
at the close of each day and shall be payable (i) on the first day of each month
in arrears, (ii) on termination of this Agreement pursuant to Section 23 hereof,
(iii) on acceleration of the time for payment of the Obligations pursuant to
Section 18 hereof, and (iv) on the date the Obligations are paid in full. The
rate of interest payable by Borrower shall be changed effective as of that date
in which a change in the Prime Rate becomes effective. Interest shall be
computed on the basis of the actual number of days elapsed over a year of three
hundred sixty (360) days. The term "Prime Rate" as used herein and in any
supplement and amendment hereto shall mean the per annum rate of interest
announced from time to time by Bank, as its Prime Rate (or if Bank ceases to
announce a rate so designated, any similar successor rate designated by Bank),
it being understood that such rate is a reference rate and not necessarily the
lowest rate of interest charged by Bank. Interest shall be payable in lawful
money of the United States of America to Bank, or as Bank shall direct, without
set-off, deduction or counterclaim monthly, in arrears, on the first day of each
month, commencing on the first day of the month next succeeding the date hereof.

            Interest, net of those loans (if any) which bear interest calculated
by reference to the Prime Rate, will be charged to Borrower at a rate which is
the equivalent to the LIBOR Interest Rate (as defined below) plus Applicable
Margin (as defined below).

            (c) The term "Borrowing Base" as used herein shall mean the sum of
the following:

                  (i) Eighty (80%) percent, to be increased to ninety (90%)
      percent for any Qualified Accounts backed by letters of credit in form and
      substance, and from institutions, reasonably satisfactory to the Bank, of
      the unpaid face amount of Qualified Accounts (as defined below) or such
      other percentage thereof as may from time to time be fixed by Bank upon at
      least five (5) Business Days prior notice to Borrower, if Bank determines
      in its

                                       -5-


      reasonable judgment that there has been a change in circumstances relating
      to any or all Accounts from those circumstances in existence on or prior
      to the date hereof, PLUS

                  (ii) the lesser of (A) Seven Million Five Hundred Thousand
      ($7,500,000.00) Dollars, or (B) sixty (60%) percent of the cost or market
      value, whichever is lower, of all Eligible Inventory (as defined below)
      consisting of finished goods inventory, or such other percentages of
      Eligible Inventory as may from time to time be fixed by Bank upon at least
      five (5) Business Days prior notice to Borrower, if Bank determines in its
      reasonable judgment that there has been a change in circumstances relating
      to any or all such Inventory from those circumstances in existence on or
      prior to the date hereof, MINUS

                  (iii) one hundred (100%) percent of the aggregate amount then
      undrawn on all Letters of Credit and acceptances issued pursuant to this
      Agreement for the account of the Borrower

but in no event shall the sum of all loans plus the sum of the aggregate amount
undrawn on all Letters of Credit and acceptances be in excess of the Credit
Limit.

            (d) The term "Credit Limit" as used herein shall mean an amount
equal to Twenty Million ($20,000,000.00) Dollars minus the amount then
outstanding under the Term Note (as defined below).

            (e) Borrower hereby authorizes and directs Bank, in Bank's sole
discretion (provided, however, Bank shall have no obligation to do so) (i) to
pay accrued interest as the same becomes due and payable pursuant to this
Agreement or pursuant to any note or other agreement between Borrower and Bank,
and to treat the same as a loan to Borrower, which shall be added to Borrower's
loan balance pursuant to this Agreement, (ii) to charge any amount due and
payable by Borrower to Bank hereunder to any of Borrower's accounts under the
control of Bank, or (iii) during the existence of an Event of Default, apply the
proceeds of Collateral, including, without limitation, payments on Accounts and
other payments from sales or lease of Inventory and any other funds to the
payment of such items. Bank shall promptly notify Borrower of any such charges
or applications.

            (f) The Borrowing Base formula set forth above is intended solely
for monitoring purposes. The making of loans, advances, and credits by Bank to
the Borrower in excess of the above described Borrowing Base formula is for the
benefit of the Borrower and does not affect the obligations of Borrower
hereunder, all such loans constitute Obligations and must be repaid by Borrower
in accordance with the terms of this Agreement.

            (g) At the request of the Borrower, and upon the execution of letter
of credit documentation reasonably satisfactory to Bank, up to Three Million
Dollars ($3,000,000.00) in the aggregate at any one time, and, if applicable,
within the limits of the Borrowing Base, as then computed and also within the
limits of the Credit Limit as then computed, shall issue letters of credit from
time to time by Bank for the account of the Borrower (collectively "Letters of
Credit"). The

                                       -6-


Letters of Credit shall be on terms mutually acceptable to Bank and Borrower,
and unless otherwise agreed by the Bank, no Letter of Credit shall have an
expiration date later than the sooner to occur of (i) twelve (12) months from
the date of issuance of the subject Letter of Credit, or (ii) the Termination
Date. A loan in an amount equal to any amount paid by Bank under a Letter of
Credit shall be deemed made to Borrower, without request therefor, promptly upon
any payment by Bank on such Letter of Credit. In connection with the issuance of
any Letter of Credit, Borrower shall pay to Bank one and one-quarter (1.25%)
percent of the face amount of such Letter of Credit plus transaction fees at the
customary rates charged by Bank and all other normal and customary fees charged
by Bank Borrower hereby authorizes and directs Bank, in Bank's sole discretion
(provided, however, Bank shall have no obligation to do so) to pay all such fees
and costs as the same become due and payable and to treat the same as a loan to
Borrower, which shall be added to Borrower's loan balance pursuant to this
Agreement. For purposes of computing the Credit Limit, all Letters of Credit
shall be deemed to be loans.

            (h) Borrower shall pay to Bank the principal amount of all loans as
follows:

                  (i) Borrowing Base Exceeded. Whenever the outstanding
      principal balance of all loans exceed the Borrowing Base, Borrower shall
      promptly pay to Bank the excess of the outstanding principal balance of
      the loans over the Borrowing Base.

                  (ii) Payment in Full on Termination. On termination of this
      Agreement, pursuant to Section 23 or acceleration of the obligations
      pursuant to Section 18, Borrower shall pay to Bank the entire outstanding
      principal balance of all loans and shall deliver to Bank cash collateral
      in an amount equal to the aggregate of (A) amounts then undrawn on all
      outstanding Letters of Credit issued pursuant to this Agreement for the
      account of the Borrower, and (B) the amount of all outstanding acceptances
      issued pursuant to this Agreement.

            (i) Bank may, at any time and from time to time, in its reasonable
judgment upon at least five (5) Business Days prior notice to Borrower establish
reserves against the Accounts and/or the Inventory of the Borrower. The amount
of such reserves shall be subtracted from Qualified Accounts or Eligible
Inventory, as applicable, when calculating the amount of the Borrowing Base.

      6. EQUIPMENT LOAN.

            (a) Subject to, and in accordance with, the within Agreement, until
the occurrence and continuance of an Event of Default and upon satisfaction of
all conditions precedent described in Section 6(b) below, on or before May 26,
2007 (the "Draw Period"), Borrower may borrow, for the purposes of acquiring
production machinery and equipment up to the lesser of (a) eighty (80%) percent
of the eligible (as determined by the Bank) "hard costs" acquisition costs of
Equipment deemed acceptable by the Bank, excluding freight, installation costs,
and other soft costs or (b) the lesser of (i) (I) the difference between the
Credit Limit and (II) the then outstanding balance under

                                       -7-


the Line of Credit, or (ii) Two Million ($2,000,000.00) Dollars (the "Equipment
Loan"). The Equipment Loan shall be repaid in accordance with the terms of a
certain Term Note (hereinafter, the "Term Note") in the form of Exhibit 2
annexed hereto to be executed by Borrower.

            (b) Borrower may request the borrowing under its Equipment Loan by
completing and delivery to the Bank an Equipment Loan Certificate in the form of
Exhibit 3 annexed hereto, which Equipment Loan Certificate shall specify,
without limitation, the following:

                  (i)   the amount of the proposed Loan,

                  (ii)  the Business Day of the proposed Equipment Loan,

                  (iii) the use of the proceeds of the proposed Equipment Loan,
                        and supporting documentation, including, without
                        limitation, any purchase invoices, evidencing the
                        Borrower's intended use of the proceeds, and

                  (iv)  the Borrower's certification that there are no Events of
                        Default existing.

      7. GENERAL INTEREST PROVISIONS AS TO ALL LOANS.

            (a) It is the intention of the parties hereto to comply strictly
with applicable usury laws, if any, accordingly, notwithstanding any provisions
to the contrary in this Agreement or any other documents or instruments executed
in connection herewith, in no event shall this Agreement or such documents or
instruments require or permit the payment, taking, reserving, receiving,
collecting or charging of any sums constituting interest under applicable laws
which exceed the maximum amount permitted by such laws. If any such excess
interest is called for, contracted for, charged, paid, taken, reserved,
collected or received in connection with the Obligations or in any communication
by Bank or any other person to the Borrower or any other person, or in the event
all or part of the principal of the Obligations or interest thereon shall be
prepaid or accelerated, so that under any of such circumstances or under any
other circumstance whatsoever the amount of interest contracted for, charged,
taken, collected, reserved, or received on the amount of principal actually
outstanding from time to time under this Agreement shall exceed the maximum
amount of interest permitted by applicable usury laws, if any, then in any such
event it is agreed as follows (i) the provisions of this paragraph shall govern
and control, (ii) neither the Borrower nor any other person or entity now or
hereafter liable for the payment of the Obligations shall be obligated to pay
the amount of such interest to the extent such interest is in excess of the
maximum amount of interest permitted by applicable usury laws, if any, (iii) any
such excess which is or has been received notwithstanding this paragraph shall
be credited against the then unpaid principal balance hereof or, if the
Obligations have been or would be paid in full by such credit, refunded to the
Borrower, and (iv) the provisions of this Agreement and the other documents or
instruments executed in connection herewith, and any communication to the
Borrower, shall immediately be deemed reformed and such excess interest reduced,
without the necessity of executing any other document, to the maximum lawful
rate allowed under applicable laws as now or hereafter construed by courts
having jurisdiction

                                       -8-


hereof or thereof. Without limiting the foregoing, all calculations of the rate
of interest contracted for, charged, taken, collected, reserved, or received in
connection herewith which are made for the purpose of determining whether such
rate exceeds the maximum lawful rate shall be made to the extent permitted by
applicable laws by amortizing, prorating, allocating and spreading during the
period of the full term of the Obligations, including all prior and subsequent
renewals and extensions, all interest at any time contracted for, charged,
taken, collected, reserved or received. The terms of this paragraph shall be
deemed to be incorporated in every Loan Document and communication relating to
the Obligations.

            (b) As used in this Agreement, the following terms shall have the
following meanings:

            "Applicable Margin" shall mean one and one-quarter (1.25%) percent
            per annum (i.e., 125 basis points).

            "Borrowing Date" shall mean any day upon which a LIBOR Rate Loan is
            made.

            "Business Day" shall mean:

                  (i) any day which is neither a Saturday or Sunday nor a legal
            holiday on which commercial banks are authorized or required to be
            closed in Boston, Massachusetts,

                  (ii) when such term is used to describe a day on which a
            borrowing, payment, prepayment, or repayment is to be made in
            respect of any LIBOR Rate Loan, any day which is (A) neither a
            Saturday or Sunday nor a legal holiday on which commercial banks are
            authorized or required to be closed in New York City, and (B) a
            London Banking Day, and

                  (iii) when such term is used to describe a day on which an
            interest rate determination is to be made in respect of any LIBOR
            Rate Loan, any day which is a London Banking Day.

            "Dollars" or "$" shall mean currency of the United States of
            America.

            "Eurodollars" shall mean Dollars acquired by Bank through the
            purchase or other acquisition of deposits denominated in Dollars and
            made with any bank or branch of a bank (including any branch of the
            Bank) located outside the United States of America.

            "Hedging Contracts" shall mean interest rate swap agreements,
            interest rate cap agreements and interest rate collar agreements, or
            any other agreements or

                                      -9-


arrangements entered into between Borrower and Bank designed to protect the
Borrower against fluctuations in interest rates or currency exchange rates.

"Hedging Obligations" means, with respect to Borrower, all liabilities of
Borrower to Bank under Hedging Contracts.

"Interbank Market" shall mean, with respect to any LIBOR Rate Loan, any
recognized interbank Eurodollar market chosen in good faith by Bank.

"Interest Payment Date" shall mean, relative to any LIBOR Rate Loan, having an
Interest Period of three months or less, the last Business Day of such Interest
Period, and as to any LIBOR Rate Loan having an Interest Period longer than
three months, each Business Day which is three months, or a whole multiple
thereof, after the first day of such Interest Period and the last day of such
Interest Period.

"Interest Period" shall mean, relative to any LIBOR Rate Loans:

      (i) initially, the period beginning on (and including) the date on which
such LIBOR Rate Loan is made or continued as, or converted into, a LIBOR Rate
Loan pursuant to this Agreement and ending on (but excluding) the day which
numerically corresponds to such date one, two, three, or six months thereafter
(or, if such month has no numerically corresponding day, on the last Business
Day of such month), in each case as the Borrower may select in its notice
pursuant to this Agreement, and

      (ii) thereafter, each period commencing on the last day of the next
preceding. Interest Period applicable to such LIBOR Rate Loan and ending one,
two, three, or six months thereafter, as selected by the Borrower by irrevocable
notice to the Bank not less than two Business Days prior to the last day of the
then current Interest Period with respect thereto, provided, however, that

      (i) the Borrower shall not be permitted to select Interest Periods to be
in effect at any one time which have expiration dates occurring on more than
five (5) different dates,

      (ii) Interest Periods commencing on the same date for LIBOR Rate Loans
comprising part of the same advance under this Agreement shall be of the same
duration;

                                      -10-


      (iii) Interest Periods for LIBOR Rate Loans in connection with which
Borrower has or may incur Hedging Obligations with the Bank shall be of the same
duration as the relevant periods set under the applicable Hedging Contracts,

      (iv) if such Interest Period would otherwise end on a day which is not a
Business Day, such Interest Period shall end on the next following Business Day
unless such day falls in the next calendar month, in which case such Interest
Period shall end on the first preceding Business Day, and

      (v) no Interest Period may end later than the Termination Date.

"LIBOR Lending Rate" shall mean, relative to any LIBOR Rate Loan to be made,
continued or maintained as, or converted into, a LIBOR Rate Loan for any
Interest Period, a rate per annum determined pursuant to the following formula.

      LIBOR Lending Rate      =                    LIBOR Rate
                                        ---------------------------------
                                        (1.00 - LIBOR Reserve Percentage)

"LIBOR Rate" shall mean, relative to any Interest Period for LIBOR Rate Loans,
the offered rate for deposits of U.S. Dollars in an amount approximately equal
to the amount of the requested LIBOR Rate Loan for a term coextensive with the
designated Interest Period which the British Bankers' Association fixes as its
LIBOR rate and which appears on the Telerate Page 3750 as of 11:00 a.m. London
time on the day which is two London Banking Days (as defined below) prior to the
beginning of such Interest Period.

"LIBOR Rate Loan" shall mean, any loan or advance the rate of interest
applicable to which is based upon the LIBOR Rate.

"LIBOR Reserve Percentage" shall mean, relative to any day of any Interest
Period for LIBOR Rate Loans, the maximum aggregate (without duplication) of the
rates (expressed as a decimal fraction) of reserve requirements (including all
basic, emergency, supplemental, marginal and other reserves and taking into
account any transitional adjustments or other scheduled changes in reserve
requirements) under any regulations of the Board of Governors of the Federal
Reserve System (the "Board") or other governmental authority having jurisdiction
with respect thereto as issued from time to time and then applicable to assets
or liabilities consisting of "Eurocurrency Liabilities", as currently defined in
Regulation D of the Board, having a term approximately equal or comparable to
such Interest Period.

"London Banking Day" shall mean a day on which dealings in US dollar deposits
are transacted in the London Interbank Market.

"Maturity Date" shall mean the date on which an Interest Period expires.

                                      -11-


            "Prime Rate Loan(s)" shall mean, when used in the singular, any
            loans on which the interest rate is calculated by reference to the
            Prime Rate and, when used in the plural, shall mean all such loans.

            (c) Bank shall not be required to make a LIBOR Rate Loan, or convert
a Prime Rate Loan into a LIBOR Rate Loan, unless Bank shall have received from
the Borrower a request for such LIBOR Rate Loan, in the form of Exhibit 4
annexed hereto (herein a "Notice of Borrowing"). By delivering a borrowing
request (i.e., Notice of Borrowing) to the Bank on or before 10:00 a.m., New
York time, on a Business Day, the Borrower may from time to time irrevocably
request, on not less than two nor more than five Business Days' notice, that a
LIBOR Rate Loan be made in a minimum amount of Two Hundred Fifty Thousand
($250,000.00) Dollars and integral multiples of One Hundred Thousand
($100,000.00) Dollars. On the terms and subject to the conditions of this
Agreement, each LIBOR Rate Loan shall be made available to the Borrower no later
than 11:00 a.m. New York time on the first day of the applicable. Interest
Period by deposit to the account of the Borrower as shall have been specified in
its borrowing request.

            (d) After receipt from the Borrower of any Notice of Borrowing which
requests a LIBOR Rate Loan, Bank shall determine if it is able to make such
LIBOR Rate Loan (or if it is unable to do so for reasons described in this
section only) and will notify the Borrower upon confirmation of its ability to
do so. If Bank determines in good faith that, by reason of circumstances
affecting the Interbank Market, adequate and reasonable methods do not exist for
ascertaining the LIBOR Rate which would otherwise be applicable to such LIBOR
Rate Loan, then Bank shall so notify the Borrower on or before 4:00 p.m. on the
Business Day prior to the Borrowing Date specified in the Notice of Borrowing,
and in such event, Bank shall not be obligated to make such LIBOR Rate Loan and
the Notice of Borrowing shall be deemed to have been withdrawn by the Borrower
with Bank's consent and substituted with a request for a Prime Rate Loan in an
amount equal to the requested LIBOR Rate Loan.

            (e) By delivering a continuation/conversion notice to the Bank on or
before 10:00 a.m., New York time, on a Business Day, the Borrower may from time
to time irrevocably elect, on not less than two nor more than five Business
Days' notice, that all, or any portion in an aggregate minimum amount of Two
Hundred Fifty Thousand ($250,000.00) Dollars and integral multiples of One
Hundred Thousand ($100,000.00) of any LIBOR Rate Loan be converted on the last
day of an Interest Period into a LIBOR Rate Loan with a different Interest
Period, or continued on the last day of an Interest Period as a LIBOR Rate Loan
with a similar Interest Period, provided, however, that no portion of the
outstanding principal amount of any LIBOR Rate Loans may be converted to, or
continued as, LIBOR Rate Loans when any default or Event of Default has occurred
and is continuing, and no portion of the outstanding principal amount of any
LIBOR Rate Loans may be converted to, LIBOR Rate Loans of a different duration
if such LIBOR Rate Loans relate to any Hedging Obligations. In the absence of
delivery of a continuation/conversion notice with respect to any LIBOR Rate Loan
at least two Business Days before the last day of the then current Interest

                                      -12-


Period with respect thereto, such LIBOR Rate Loan shall, on such last day,
automatically convert to a loan that accrues interest by reference to the Prime
Rate.

            (f) Except as otherwise provided herein, any Notice of Borrowing
which requests a LIBOR Rate Loan shall be irrevocable and binding upon the
Borrower. In the event the Borrower fails to borrow the LIBOR Rate Loan
requested on the Borrowing Date specified in such Notice of Borrowing, the
Borrower shall indemnify Bank against any and all losses and expenses incurred
by Bank by reason of such failure including, without limiting the generality of
the foregoing, all losses and expenses incurred by reason of the liquidation,
disposition or reemployment of deposits or other funds acquired by Bank to fund
such LIBOR Rate Loan.

            (g) Interest on the outstanding principal amount of each LIBOR Rate
Loan shall accrue during the Interest Period applicable thereto at a rate equal
to the sum of the LIBOR Lending Rate for such Interest Period plus the
Applicable Margin thereto and be payable on each Interest Payment Date.

            (h) LIBOR Rate Loans shall mature and become payable in full on the
last day of the Interest Period relating to such LIBOR Rate Loan. Upon maturity,
a LIBOR Rate Loan may be continued for an additional Interest Period or may be
converted to a Prime Rate Loan, as set forth above.

            (i) LIBOR Rate Loans may be prepaid on the terms and conditions set
forth herein For LIBOR Rate Loans in connection with which the Borrower has or
may incur Hedging Obligations, additional obligations may be associated with
prepayment in accordance with the terms and conditions of the applicable Hedging
Contracts. The Borrower shall give the Bank, no later than 10:00 a.m., New York
City time, at least four (4) Business Days notice of any proposed prepayment of
any LIBOR Rate Loans, specifying the proposed date of payment of such LIBOR Rate
Loans, and the principal amount to be paid. Each partial prepayment of the
principal amount of LIBOR Rate Loans shall be in an integral multiple of Fifty
Thousand ($50,000.00) Dollars and accompanied by the payment of all charges
outstanding on such LIBOR Rate Loans and of all accrued interest on the
principal repaid to the date of payment. Borrower acknowledges that prepayment
or acceleration of a LIBOR Rate Loan during an Interest Period shall result in
the Bank incurring additional costs, expenses and/or liabilities and that it is
extremely difficult and unpractical to ascertain the extent of such costs,
expenses and/or liabilities. Therefore, all full or partial prepayments of LIBOR
Rate Loans shall be accompanied by, and the Borrower hereby promises to pay, on
each date a LIBOR Rate Loan is prepaid or the date all sums payable hereunder
become due and payable, by acceleration or otherwise, in addition to all other
sums then owing, an amount ("LIBOR Rate Loan Prepayment Fee") determined by the
Bank pursuant to the following formula:

            (i) the then current rate for United States Treasury securities
                (bills on a discounted basis shall be converted to a bond
                equivalent) with a maturity date closest to the end of the
                Interest Period as to which prepayment is made, subtracted from

                                      -13-


            (ii) the LIBOR Lending Rate plus the Applicable Margin applicable to
                 the LIBOR Rate Loan being prepaid.

            If the result of this calculation is zero or a negative number, then
there shall be no LIBOR Rate Loan Prepayment Fee. If the result of this
calculation is a positive number, then the resulting percentage shall be
multiplied by

            (iii) the amount of the LIBOR Rate Loan being prepaid.

            The resulting amount shall be divided by

            (iv) 360

            and multiplied by

            (v) the number of days remaining in the Interest Period as to which
                the prepayment is being made.

            Said amount shall be reduced to present value calculated by using
the referenced United States Treasury securities rate and the number of days
remaining on the Interest Period for the LIBOR Rate Loan being prepaid.

            The resulting amount of these calculations shall be the LIBOR Rate
Loan Prepayment Fee.

            (j) If the Bank shall determine (which determination shall, upon
notice thereof to the Borrower be conclusive and binding on the Borrower) that
the introduction of or any change in or in the interpretation of any law, rule,
regulation or guideline (whether or not having the force of law), makes it
unlawful, or any central bank or other governmental authority asserts that it is
unlawful, for the Bank to make, continue or maintain any LIBOR Rate Loan as, or
to convert any loan into, a LIBOR Rate Loan of a certain duration, the
obligations of the Bank to make, continue, maintain or convert into any such
LIBOR Rate Loans shall, upon such determination, forthwith be suspended until
the Bank shall notify the Borrower that the circumstances causing such
suspension no longer exist, and all LIBOR Rate Loans of such type shall
automatically convert into Pnme Rate Loans at the end of the then current
Interest Periods with respect thereto or sooner, if required by such law or
assertion.

            (k) If, due to payments made by the Borrower pursuant to this
Agreement or due to the acceleration of the Obligations or due to any other
reason, Bank receives payments of principal of any LIBOR Rate Loan prior to the
Maturity Date for such LIBOR Rate Loan, the Borrower shall, upon demand by Bank,
pay to Bank any amounts required to compensate Bank for any additional losses,
costs or expenses which it may reasonably incur as a result of such payment,
including, without limitation, any loss, costs or expenses incurred by reason of
the liquidation or reemployment.

                                      -14-


of deposits or other funds acquired by Bank to fund or maintain such LIBOR Rate
Loans

            (l)   If the Bank shall have determined that

            (i)   US dollar deposits in the relevant amount and for the relevant
                  Interest Period are not available to the Bank in the London
                  Interbank Market,

            (ii)  by reason of circumstances affecting the Bank in the London
                  Interbank Market, adequate means do not exist for ascertaining
                  the LIBOR Rate applicable hereunder to LIBOR Rate Loans of any
                  duration, or

            (iii) the LIBOR Rate no longer adequately reflects the Bank's cost
                  of funding loans.

            Then, upon notice from the Bank to the Borrower, the obligations of
the Bank to make or continue any loans as, or to convert any loans into, LIBOR
Rate Loans of such duration shall forthwith be suspended until the Bank shall
notify the Borrower that the circumstances causing such suspension no longer
exist.

            (m) In addition to the LIBOR Rate Loan Prepayment Fee, the Borrower
agrees to reimburse the Bank (without duplication) for any increase in the cost
to the Bank, or reduction in the amount of any sum receivable by the Bank, in
respect, or as a result of,

            (i)   any conversion or repayment or prepayment of the principal
                  amount of any LIBOR Rate Loans on a date other than the
                  scheduled last day of the Interest Period applicable thereto,

            (ii)  any loans not being made as LIBOR Rate Loans in accordance
                  with the borrowing request thereof,

            (iii) any LIBOR Rate Loans not being continued as, or converted
                  into, LIBOR Rate Loans in accordance with the
                  continuation/conversion notice thereof, or

            (iv)  any costs associated with marking to market any Hedging
                  Obligations that (in the reasonable determination of the Bank)
                  are required to be terminated as a result of any conversion,
                  repayment or prepayment of the principal amount of any LIBOR
                  Rate Loan on a date other than the scheduled last day of the
                  Interest Period applicable thereto,

            The Bank shall promptly notify the Borrower in writing of the
occurrence of any such event, such notice to state, in reasonable detail, the
reasons therefor and the additional amount required fully to compensate the Bank
for such increased cost or reduced amount. Such additional

                                      -15-


amounts shall be payable by the Borrower to the Bank within five days of its
receipt of such notice, and such notice shall, in the absence of manifest error,
be conclusive and binding on the Borrower. The Borrower understands, agrees and
acknowledges the following (a) the Bank does not have any obligation to
purchase, sell and/or match funds in connection with the use of LIBOR Rate as a
basis for calculating the rate of interest on a LIBOR Rate Loan, (b) the LIBOR
Rate may be used merely as a reference in determining such rate, and (c) the
Borrower has accepted the LIBOR Rate as a reasonable and fair basis for
calculating such rate, the LIBOR Rate Prepayment Fee, and other funding losses
incurred by the Bank. Borrower further agrees to pay the LIBOR Rate Prepayment
Fee and other funding losses, if any, whether or not the Bank elects to
purchase, sell and/or match funds.

            (n) If on or after the date hereof the adoption of any applicable
law, rule or regulation or guideline (whether or not having the force of law),
or any change therein, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by the Bank
with any request or directive (whether or not having the force of law) of any
such authority, central bank or comparable agency:

            (i)   shall subject the Bank to any tax, duty or other charge with
                  respect to its LIBOR Rate Loans or its obligation to make
                  LIBOR Rate Loans, or shall change the basis of taxation of
                  payments to the Bank of the principal of or interest on its
                  LIBOR Rate Loans or any other amounts due under this Agreement
                  in respect of its LIBOR Rate Loans or its obligation to make
                  LIBOR Rate Loans (except for the introduction of, or change in
                  the rate of, tax on the overall net income of the Bank or
                  franchise taxes, imposed by the jurisdiction (or any political
                  subdivision or taxing authority thereof) under the laws of
                  which the Bank is organized or in which the Bank's principal
                  executive office is located), or

            (ii)  shall impose, modify or deem applicable any reserve, special
                  deposit or similar requirement (including, without limitation,
                  any such requirement imposed by the Board of Governors of the
                  Federal Reserve System of the United States) against assets
                  of, deposits with or for the account of, or credit extended
                  by, the Bank or shall impose on the Bank or on the London
                  Interbank Market any other condition affecting its LIBOR Rate
                  Loans or its obligation to make LIBOR Rate Loans,

and the result of any of the foregoing is to increase the cost to the Bank of
making or maintaining any LIBOR Rate Loan, or to reduce the amount of any sum
received or receivable by the Bank under this Agreement with respect thereto, by
an amount deemed by the Bank to be material, then the Bank shall notify the
Borrower thereof within a reasonable time after the occurrence thereof and,
within fifteen (15) days after demand by the Bank, the Borrower shall pay to the
Bank such additional amount or amounts as will compensate the Bank for such
increased cost or reduction.

                                      -16-


            (o) All payments by the Borrower of principal of, and interest on,
the LIBOR Rate Loans and all other amounts payable hereunder shall be made free
and clear of and without deduction for any present or future income, excise,
stamp or franchise taxes and other taxes, fees, duties, withholdings or other
charges of any nature whatsoever imposed by any taxing authority, but excluding
franchise taxes and taxes imposed on or measured by the Bank's net income or
receipts (such non-excluded items being called "Taxes"). In the event that any
withholding or deduction from any payment to be made by the Borrower hereunder
is required in respect of any Taxes pursuant to any applicable law, rule or
regulation, then the Borrower will:

            (i)   pay directly to the relevant authority the full amount
                  required to be so withheld or deducted,

            (ii)  promptly forward to the Bank an official receipt or other
                  documentation reasonably satisfactory to the Bank evidencing
                  such payment to such authority, and

            (iii) pay to the Bank such additional amount or amounts as is
                  necessary to ensure that the net amount actually received by
                  the Bank will equal the full amount the Bank would have
                  received had no such withholding or deduction been required.

            Moreover, if any Taxes are directly asserted against the Bank with
respect to any payment received by the Bank hereunder, the Bank may pay such
Taxes and the Borrower will promptly pay such additional amount (including any
penalties, interest or expenses) as is necessary in order that the net amount
received by the Bank after the payment of such Taxes (including any Taxes on
such additional amount) shall equal the amount the Bank would have received had
not such Taxes been asserted.

            If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Bank the required receipts or other
required documentary evidence, the Borrower shall indemnify the Bank for any
incremental Taxes, interest or penalties that may become payable by the Bank as
a result of any such failure.

            (p) Notwithstanding anything to the contrary contained herein, Bank
and Borrower agree that after the occurrence of an Event of Default which is
continuing, Borrower shall not request and Bank will not make LIBOR Rate Loan.

            (q) Without derogating from any rights of the Bank, Borrower shall
pay a late charge equal to five (5%) percent of any amounts not paid when due.

            (r) All calculation of interest and fees shall be made on the basis
of actual number of days elapsed in a 360 year.

                                      -17-


            (s) All payments shall be applied first to the payment of all fees,
expenses and other amounts due to the Bank (excluding principal and interest),
then to accrued interest, and the balance on account of outstanding principal,
provided, however, that after an Event of Default, payments will be applied to
the obligations of Borrower to Bank as Bank determines in its sole discretion.

      8 DEFINITION OF QUALIFIED ACCOUNT The term "Qualified Account", as used
herein, means an Account owing to Borrower which met the following
specifications at the time it came into existence and continues to meet the same
until it is collected in full, unless otherwise agreed by the Bank and the
Borrower.

            (a) The Account is not more than ninety (90) days from the date of
the invoice thereof.

            (b) The Account arose from the performance of services or an
outright sale of goods by Borrower, such goods have been shipped to the account
debtor, and Borrower has possession of, or has delivered to Bank, shipping and
delivery receipts evidencing such shipment.

            (c) The Account is not subject to any prior assignment, claim, lien,
or security interest, and Borrower will not make any further assignment thereof
or create any further security interest therein, nor permit Borrower's rights
therein to be reached by attachment, levy, garnishment or other judicial
process.

            (d) The Account is not subject to set-off, credit, allowance or
adjustment by the account debtor, except discount allowed for prompt payment and
the account debtor has not complained as to his liability thereon and has not
returned any of the goods from the sale of which the Account arose.

            (e) The Account arose in the ordinary course of Borrower's business
and did not arise from the performance of services or a sale of goods to a
supplier or employee of the Borrower.

            (f) No notice of bankruptcy or insolvency of the account debtor has
been received by or is known to the Borrower.

            (g) The Account is not owed by an account debtor whose principal
place of business is outside the United States of America, which are not
supported by credit insurance in form and substance reasonably satisfactory to
the Bank.

            (h) The Account is not owed by an entity which is a parent,
brother/sister, subsidiary or affiliate of Borrower.

                                      -18-


            (i) The account debtor is not located in the State of New Jersey or
in the State of Minnesota (or any other state that requires an entity to file a
business activity report or similar document in order to bring suit or otherwise
enforce its remedies against an account debtor in the courts or through any
judicial process of such state), unless (i) Borrower has filed and shall file
all legally required Notice of Business Activities Reports with the New Jersey
Division of Taxation or the Minnesota Department of Revenue, as the case may be,
or (ii) Borrower is exempt from such filing requirement.

            (j) The Account when aggregated with all of the Accounts of that
account debtor does not exceed fifty (50%) percent of the then aggregate of
Qualified Accounts.

            (k) The Account is not evidenced by a promissory note.

            (l) The Account did not arise out of any sale made on a bill and
hold, dating or delayed shipment basis.

            (m) The Account does not arise out of a progress billing prior to
completion of the order therefor.

            (n) Bank has not notified Borrower that Bank, in accordance with its
normal credit policies, has deemed the Account to be unacceptable for any
reason.

PROVIDED THAT if at any time fifty (50%) percent or more of the aggregate amount
of the Accounts due from any account debtor are unpaid in whole or in part more
than ninety (90) days from the respective dates of invoice, from and after such
time none of the Accounts (then existing or hereafter arising) due from such
account debtor shall be deemed to be Qualified Accounts until such time as all
Accounts due from such account debtor are (as a result of actual payments
received thereon) no more than ninety (90) days from the date of invoice,
Accounts payable by Borrower to an account debtor shall be netted against
Accounts due from such account debtor and the difference (if positive) shall
constitute Qualified Accounts from such account debtor for purposes of
determining the Borrowing Base (notwithstanding paragraph (d) above),
characterization of any Account due from an account debtor as a Qualified
Account shall not be deemed a determination by Bank as to its actual value nor
in any way obligate Bank to accept any Account subsequently arising from such
account debtor to be, or to continue to deem such Account to be, a Qualified
Account, it is Borrower's responsibility to determine the creditworthiness of
account debtors and all risks concerning the same and collection of Accounts are
with Borrower, and all Accounts whether or not Qualified Accounts constitute
Collateral.

      9 DEFINITION OF ELIGIBLE INVENTORY The term "ELIGIBLE INVENTORY", AS used
herein, means Borrower's finished goods which are initially and at all times
until sold new and unused (except, with Bank's written approval, used equipment
held for sale or lease), in first-class condition, merchantable and saleable
through normal trade channels, at a location which has been identified in
writing to Bank, subject to a perfected first priority security interest in
favor of Bank,

                                      -19-


owned by Borrower free and clear of any lien except in favor of Bank, not
obsolete, not scrap, waste, defective goods and the like, have been produced by
Borrower in accordance with the Federal Fair Labor Standards Act of 1938, as
amended, and all rules, regulations and orders promulgated thereunder, not
stored with a bailee, warehouseman or similar party unless Bank has given its
prior written consent thereto and Borrower has caused each such bailee,
warehouseman or similar party to issue and deliver to Bank warehouse receipts in
Bank's name for such Inventory, and have not been designated by Bank (with
notice thereof to Borrower), in accordance with its normal credit policies, as
unacceptable for any reason by notice to Borrower.

      10 BANK'S REPORTS. After the end of each month, Bank will render to
Borrower a statement of Borrower's loan account with Bank hereunder, showing all
applicable credits and debits. Each statement shall be considered correct and to
have been accepted by Borrower and shall be conclusively binding upon Borrower
in respect of all charges, debits and credits of whatsoever nature contained
therein under or pursuant to this Agreement, and the closing balance shown
therein, unless Borrower notifies Bank in writing of any discrepancy within
sixty (60) days from the mailing by Bank to Borrower of any such monthly
statement

      11 CONDITIONS OF LENDING.

         (a) The obligation of Bank to make the initial loan hereunder or
issuing or causing to be issued any Letter of Credit hereunder shall be subject
to the condition precedent that Bank shall have received all of the following,
each in form and substance reasonably satisfactory to Bank:

                  (i) This Agreement, properly executed on behalf of Borrower;

                  (ii) The Master Note drawn to the order of Bank in the face
      amount of the Credit Limit;

                  (iii) The Term Note drawn to the order of Bank in the face
      amount of Equipment Loan;

                  (iv) A true and correct copy of any and all leases pursuant to
      which Borrower is leasing any real property, together with a landlord's
      consent and waiver with respect to such real property;

                  (v) Current searches of appropriate filing offices showing
      that (A) no state or federal tax liens have been filed and remain in
      effect against Borrower, (B) no financing statements have been filed and
      remain in effect against Borrower, except those financing statements
      relating to liens set forth on Schedule "B", the liens of the secured
      lender to be paid with the proceeds of the initial loan and those
      financing statements filed by the Bank, and (C) the Bank has duly filed
      all financing statements necessary to perfect the security interests
      granted hereunder, to the extent the security interests are capable of
      being perfected by filing;

                                      -20-


                  (vi) A certificate of the Clerk/Secretary or an Assistant
      Clerk/Secretary of the Borrower, certifying as to (A) the resolutions of
      the directors and, if required, the shareholders of Borrower, authorizing
      the execution, delivery and performance of this Agreement and related
      documents, (B) the Certificate of Incorporation and By-Laws of Borrower,
      and (C) the signatures of the officers or agents of Borrower authorized to
      execute and deliver this Agreement and other instruments, agreements and
      certificates, including loan requests, on behalf of Borrower;

                  (vii) A current certificate issued by the Secretary of State
      of the state of the Borrower's incorporation, certifying that Borrower is
      in compliance with all corporate organizational requirements of such
      state;

                  (viii) Evidence that Borrower is duly licensed or qualified to
      transact business in all jurisdictions where the character of the property
      owned or leased or the nature of the business transacted by it makes such
      licensing or qualification necessary;

                  (ix) An opinion of counsel to the Borrower, addressed to Bank;

                  (x) Certificates of the insurance required hereunder, with all
      hazard insurance containing a lender's loss payable endorsement in favor
      of Bank;

                  (xi) A subordination agreement, properly executed by each of
      the subordinating creditors, if any, in form and substance satisfactory to
      Bank;

                  (xii) Payment of the fees due through the date of the initial
      loan and expenses incurred by Bank through such date required to be paid
      by Borrower pursuant to this Agreement;

                  (xiii) A Borrowing Base Certificate which indicates that the
      Borrower has the necessary loan availability to pay all existing secured
      lenders;

                  (xiv) Such other documents, instruments and agreements as Bank
      may reasonably request.

            (b) The obligation of Bank to make each loan shall be subject to the
further conditions precedent on such date.

                  (i) the representations and warranties contained in Sections 3
      and 4 hereof are correct on and as of the date of such loan or the
      issuance of a Letter of Credit, as the case may be, as though made on and
      as of such date, except to the extent that such representations and
      warranties relate solely to an earlier date, and;

                                      -21-


                  (ii) no event has occurred and is continuing, or would result
      from such loan or issuance of such Letter of Credit, as the case may be,
      which constitutes an Event of Default or which, with notice or the passage
      of time or both, would constitute an Event of Default.

      12    CAPITAL ADEQUACY

            If any change in, or the introduction, adoption, effectiveness,
interpretation, reinterpretation or phase-in of, any law or regulation,
directive, guideline, decision or request (whether or not having the force of
law) of any court, central bank, regulator or other governmental authority
affects or would affect the amount of capital required or expected to be
maintained by the Bank, or person controlling the Bank, and the Bank determines
(in its sole and absolute discretion) that the rate of return on its or such
controlling person's capital as a consequence of its commitments or the loans
made by the Bank is reduced to a level below that which the Bank or such
controlling person could have achieved but for the occurrence of any such
circumstance, then, in any such case, the Bank shall notify the Borrower thereof
within a reasonable time after the occurrence thereof and upon such notice from
time to time by the Bank to the Borrower, the Borrower shall promptly pay
directly to the Bank additional amounts sufficient to compensate the Bank or
such controlling person for such reduction in rate of return. A statement of the
Bank as to any such additional amount or amounts (including calculations thereof
in reasonable detail) shall, in the absence of manifest error, be conclusive and
binding on the Borrower. In determining such amount, the Bank may use any method
of averaging and attribution that it (in its sole and absolute discretion) shall
deem applicable.

                                      -22-


      13    COLLECTIONS, SET OFF, DEPOSIT ACCOUNTS, NOTICE OF ASSIGNMENT,
            EXPENSES, POWER OF ATTORNEY

            (a) Borrower will promptly, upon receipt of all checks, drafts, cash
and other remittances in payment of any Inventory sold or in payment or on
account of Borrower's accounts, contracts, contract rights, notes, bills,
drafts, acceptances, general intangibles, chooses in action and all other forms
of obligations, deliver the same to Bank accompanied by a remittance report in
form specified by Bank. Said proceeds shall be delivered to Bank in the same
form received except for the endorsement of Borrower where necessary to permit
collection of items, which endorsement Borrower agrees to make Bank will credit
(conditional upon final collection) all such payments against the principal or
interest of any loans secured hereby. The order and method of such application
shall be in the sole discretion of Bank and any portion of such funds which Bank
elects not to so apply shall be paid over from time to time by Bank to Borrower
Bank will at all times have the right to require Borrower (i) to enter into a
lockbox arrangement with Bank for the collection of such remittances and
payments, or (ii) to maintain its deposit accounts at Bank or, in the
alternative, at another financial institution which has agreed to accept drafts
drawn on it by Bank under a written depository transfer agreement with Bank and
to block Borrower's account and waive its rights as against such account.
Notwithstanding anything contained to the contrary herein, said proceeds shall
not be applied to the principal of any LIBOR Rate Loan(s), until all Prime Rate
Loans have been paid in full. As used in this section, "business day(s)" shall
mean any day which is neither a Saturday, Sunday nor holiday on which commercial
banks are authorized or required to be closed in Boston, Massachusetts.

            (b) Borrower or any guarantor hereby grant to Bank a lien, security
interest and right of setoff as security for all liabilities and Obligations to
Bank, whether now existing or hereafter arising, upon and against all deposits,
credits, collateral and property, now or hereafter in the possession, custody,
safekeeping or control of Bank or any entity in the control of Bank of America
Corporation, or in transit to any of them. At any time during an Event of
Default, without demand or notice, Bank may set off the same or any part thereof
and apply the same to any liability or Obligation of Borrower or any guarantor
even though unmatured and regardless of the adequacy of any other collateral
securing the Obligations. ANY AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS
RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE
OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH
DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER OR ANY GUARANTOR, ARE HEREBY
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

            (c) Bank shall be Borrower's main bank of deposit. Borrower shall
maintain aggregate collected funds on deposit with the Bank of at least Two
Million ($2,000,000.00) Dollars. Borrower shall maintain with the Bank at least
fifty (50%) percent of their invested assets. For each deposit account that
Borrower at any time opens or maintains, Borrower shall, at Bank's reasonable
request and option, pursuant to an agreement in form and substance reasonably
satisfactory to Bank, either (i) cause the depositary bank to agree to comply at
any time with instructions from Bank to

                                      -23-


such depositary bank directing the disposition of funds from time to time
credited to such deposit account, without further consent of Borrower, or (ii)
arrange for Bank to become the customer of the depositary bank with respect to
the deposit account, with Borrower being permitted, only with the consent of
Bank, to exercise rights to withdraw funds from such deposit account. Bank
agrees with Borrower that Bank shall not give any such instructions or withhold
any withdrawal rights from Borrower, unless an Event of Default has occurred and
is continuing, or, after giving effect to any withdrawal not otherwise permitted
by this Agreement would occur. The provisions of this paragraph shall not apply
to (i) any deposit account for which Borrower, the depositary bank and Bank have
entered into a cash collateral agreement specially negotiated among Borrower,
the depositary bank and Bank for the specific purpose set forth therein, or (ii)
deposit accounts specially and exclusively used for payroll, payroll taxes and
other employee wage and benefit payments to or for the benefit of Borrower's
salaried employees.

            (d) Bank may at any time, after the occurrence and during the
continuance of an Event of Default or an event which, with notice or the passage
of time or both, would constitute an Event of Default, notify account debtors
that Collateral has been assigned to Bank and that payments shall be made
directly to or as directed by Bank. Upon request of Bank at any such time,
Borrower will so notify such account debtors and will indicate on all billings
to such account debtors that their Accounts must be paid directly to or as
directed by Bank. At any such time, Bank shall have full power to collect,
compromise, endorse, sell or otherwise deal with the Collateral or proceeds
thereof in its own name or in the name of Borrower.

            (e) Borrower shall pay to Bank on demand any and all reasonable
counsel fees and other expenses reasonably incurred by Bank in connection with
the preparation, interpretation, enforcement, administration or amendment of
this Agreement, or of any documents relating thereto, (provided that Bank's
counsel fees in connection with the preparation of this Agreement and all
documents relating thereto shall not exceed $10,000.00) and any and all
expenses, including, but not limited to, a collection charge on all Accounts
collected, all attorneys' fees and expenses, and all other expenses of like or
unlike nature which may be expended by Bank to obtain or enforce payment of any
Account either as against the account debtor, Borrower, or any guarantor or
surety of Borrower or in the prosecution or defense of any action or concerning
any matter growing out of or connected with the subject matter of this
Agreement, the Obligations or the Collateral or any of Bank's rights or
interests therein or thereto, including, without limiting the generality of the
foregoing, any counsel fees or expenses incurred in any bankruptcy or insolvency
proceedings and all costs and expenses incurred or paid by Bank in connection
with the administration, supervision, protection or realization on any security
held by Bank for the debt secured hereby, whether such security was granted by
Borrower or by any other person primarily or secondarily liable (with or without
recourse) with respect to such debt, and all costs and expenses incurred by Bank
in connection with the defense, settlement or satisfaction of any action, claim
or demand asserted against Bank in connection with the debt secured hereby, all
of which amounts shall be considered advances to protect Bank's security, and
shall be secured hereby. At its option, and without limiting any other rights or
remedies, Bank may at any time pay or discharge any taxes, liens, security
interests or other encumbrances at any time levied against or placed on any of
the Collateral, and

                                      -24-


may procure and pay any premiums on any insurance required to be carried by
Borrower, and provide for the maintenance and preservation of any of the
Collateral, and otherwise take any action reasonably deemed necessary to Bank to
protect its security, and all amounts expended by Bank in connection with any of
the foregoing matters, including reasonable attorneys' fees, shall be considered
obligations of Borrower and shall be secured hereby.

            (f) Borrower does hereby make, constitute and appoint any officer or
agent of Bank as Borrower's true and lawful attorney-in-fact, with power during
an Event of Default to endorse the name of Borrower or any of Borrower's
officers or agents upon any notes, checks, drafts, money orders, or other
instruments of payment (including payments payable under any policy of insurance
on the Collateral) or Collateral that may come into possession of Bank in full
or part payment of any amounts owing to Bank, to sign and endorse the name of
Borrower or any of Borrower's officers or agents upon any invoice, freight or
express bill, bill of lading, storage or warehouse receipts, drafts against
debtors, assignments, verifications and notices in connection with Accounts, and
any instrument or documents relating thereto or to Borrower's rights therein, to
give written notice to such office and officials of the United States Post
Office to effect such change or changes of address so that all mail addressed to
Borrower may be delivered directly to Bank, granting upon Borrower's said
attorney full power to do any and all things necessary to be done in and about
the premises as fully and effectually as Borrower might or could do, and hereby
ratifying all that said attorney shall lawfully do or cause to be done by virtue
hereof. Neither Bank nor the attorney shall be liable for any acts or omissions
nor for any error of judgment or mistake, except for their gross negligence or
willful misconduct. This power of attorney shall be irrevocable for the term of
this Agreement and all transactions hereunder and thereafter as long as Borrower
may be indebted to Bank.

      14 FINANCING STATEMENTS. At the request of Bank, Borrower will join with
Bank in executing one or more Financing Statements pursuant to the Uniform
Commercial Code or other notices appropriate under applicable law in form
reasonably satisfactory to Bank and will pay the cost of filing the same in all
public offices wherever filing is deemed by Bank to be necessary or desirable. A
legible carbon, photographic or other reproduction of this Agreement shall be
sufficient as a financing statement Borrower hereby irrevocably authorizes Bank
at any time and from time to time to file in any Uniform Commercial Code
jurisdiction any initial financing statements and amendments thereto that (a)
indicate the Collateral (i) as all assets of Borrower other than Intellectual
Property or words of similar effect, regardless of whether any particular asset
comprised in the Collateral falls within the scope of Article 9 of the Uniform
Commercial Code of such jurisdiction, or (ii) as being of an equal or lesser
scope or with greater detail, and (b) contain any other information required by
the Uniform Commercial Code for the sufficiency or filing office acceptance of
any financing statement or amendment, including (i) whether Borrower is an
organization, the type of organization and any organization identification
number issued to Borrower, and (ii) in the case of a financing statement filed
as a fixture filing or indicating Collateral as as-extracted Collateral or
timber to be cut, a sufficient description of real property to which the
Collateral relates Borrower agrees to furnish any such information to Bank
promptly upon its reasonable request therefor Borrower also ratifies its
authorization for Bank to have filed in any Uniform Commercial

                                      -25-


Code jurisdiction any like initial financing statements or amendments thereto if
filed prior to the date hereof.

      15    BORROWER'S REPORTS

            (a) Borrower shall cause all of its invoices, including the copies
thereof, to be printed and to bear consecutive numbers and shall prepare and
issue its invoices in such consecutive numerical order. If reasonably requested
by Bank, all copies of invoices not previously delivered to Bank shall be
delivered to Bank with each schedule of Accounts. Copies of all invoices which
are voided or canceled or which for any other reason do not evidence an Account
shall be included in such delivery. If any invoice or copy thereof is lost,
destroyed or otherwise unavailable, Borrower shall account in writing, in form
reasonably satisfactory to Bank, for such missing invoice.

            (b) Borrower shall deliver to Bank all documents, as frequently as
indicated below, or at such other times as Bank may reasonably request, and all
other documents and information reasonably requested by Bank.



                        DOCUMENT                                          FREQUENCY DUE
- ----- ---------------------------------------------------  -------------------------------------------
                                                     
(iii) A Borrowing Base Certificate, including              Monthly within twenty (20) days after the
      accounts receivable agings, inventory report, cash   close of each calendar month if the Line of
      receipts, credit memos, sales, debit memos, the      Credit exceeds Six Million ($6,000,000.00)
      unpaid loan balance, new borrowing requests and the  Dollars during such preceding month.
      adjusted loan balance.

(ii)  Compliance Certificate in the form annexed           As soon as available and in any
      hereto as Exhibit 5.                                 event within forty-five (45) days
                                                           after the close of each quarterly
                                                           period of Borrower's fiscal year.


            (c) Borrower will furnish Bank as soon as available, and in any
event within forty-five (45) days after the close of each quarterly period of
its fiscal year a financial statement prepared by Borrower including, a balance
sheet as of the end of such period, and a statement of income and retained
earnings for the period commencing at the end of the previous fiscal year and
ending with the end of such period, and a statement of cash flows of the
Borrower for the portion of the fiscal year ended with the last day of such
period, all in reasonable detail and stating in comparative form the respective
figures for the corresponding date and period in the previous fiscal year, and
all prepared in accordance with generally accepted accounting principles
consistently applied, certified by the chief financial officer of the Borrower
(subject to year end adjustment).

                                      -26-


            (d) Borrower will furnish Bank, annually, as soon as available, and
in any event within one hundred twenty (120) days after the end of each fiscal
year of Borrower, a consolidated audit balance sheet as of the end of such
fiscal year, and a statement of income and retained earnings for such fiscal
year, and a statement of cash flows for such fiscal year, all in reasonable
detail and stating in comparative form the respective figures for the
corresponding date and period in the prior fiscal year, and all prepared in
accordance with generally accepted accounting principles consistently applied,
accompanied by an opinion thereon reasonably acceptable to Bank by independent
public accountants selected by the Borrower and reasonably acceptable to Bank.

            (e) Borrower will promptly, upon receipt thereof, deliver to Bank,
copies of any reports submitted to the Borrower by Borrower's independent public
accountants in connection with the examination of the financial statements of
the Borrower made by such accountants (the so-called "Management Letter").

            (f) In addition to the foregoing, the Borrower promptly shall
provide Bank with such other and additional information concerning the Borrower,
the Collateral, the operation of the Borrower's business, and the Borrower's
financial condition, including financial reports and statements, as Bank may
from time to time reasonably request from the Borrower. All financial
information provided to the Bank by the Borrower shall be prepared in accordance
with generally accepted accounting or auditing principles (as applicable)
applied consistently in the preparation thereof and with prior periods to fairly
reflect the financial conditions of the Borrower at the close of, and its
results of operations for, the periods in question.

      16    GENERAL AGREEMENTS OF BORROWER

            (a) Borrower agrees to keep all the Collateral insured with coverage
and in amounts not less than that usually carried by one engaged in a like
business and in any event not less than that reasonably required by Bank with
loss payable to Bank and Borrower, as their interests may appear (provided that
so long as no Event of Default exists, any amounts received by Bank shall be
promptly forwarded to Borrower), hereby appointing Bank as attorney for Borrower
during an Event of Default in obtaining, adjusting, settling and canceling such
insurance and endorsing any drafts. As further assurance for the payment and
performance of the Obligations, Borrower hereby assigns to Bank all sums,
including returns of unearned premiums, which may become payable during an Event
of Default under any policy of insurance on the Collateral and Borrower hereby
directs each insurance company issuing any such policy to make payment of such
sums directly to Bank.

            (b) Bank or its agents have the right to inspect the Collateral and
all records pertaining thereto at intervals to be determined by Bank during
Borrower's regular business hours upon reasonable prior notice but without
notice any time while an Event of Default exists and without hindrance or delay.
Bank shall also have the right to obtain from time to time upon its reasonable
request at the sole cost and expense of Borrower an appraisal of the Collateral
by an appraiser reasonably acceptable to Bank.

                                      -27-


            (c) Although, as above set forth, Bank has a continuing security
interest in all of Borrower's Collateral and in the proceeds thereof, Borrower
will at all times maintain as the minimum security hereunder a Borrowing Base
not less than the aggregate unpaid principal of all loans made hereunder and if
Borrower fails to do so, Borrower will promptly make the necessary reduction in
the unpaid principal amount of said loans so that the loans outstanding
hereunder do not in the aggregate exceed the Borrowing Base.

            (d) Borrower will at all times keep accurate and complete records of
Borrower's Inventory, Accounts and other Collateral, and Bank, or any of its
agents, shall have the right to call at Borrower's place or places of business
at intervals to be determined by Bank during Borrower's regular business hours
upon reasonable prior notice but without notice any time while an Event of
Default exists, and without hindrance or delay, to inspect, audit, check, and
make extracts from any copies of the books, records, journals, orders, receipts,
correspondence which relate to Borrower's Accounts, and other Collateral or
other transactions, between the parties thereto and the general financial
condition of Borrower and Bank may remove any of such records temporarily for
the purpose of having copies made thereof. Borrower shall pay to Bank all
reasonable audit fees (not to exceed $5,000.00 in any calendar year, absent an
Event of Default which is continuing), plus all travel and other expenses
incurred in connection with any such audit.

            (e) Borrower will maintain a standard and modern system of
accounting which enables Borrower to produce financial statements in accordance
with generally accepted accounting principles and maintain records pertaining to
the Collateral that contain information as from time to time may be reasonably
requested by Bank.

            (f) Borrower will maintain its corporate existence in good standing
and comply with all laws and regulations of the United States or of any state or
states thereof or of any political subdivision thereof, or of any governmental
authority which may be applicable to it or to its business.

            (g) Borrower will pay all real and personal property taxes,
assessments and charges and all franchises, income, unemployment, old age
benefits, withholding, sales and other taxes assessed against it, or payable by
it at such times and in such manner as to prevent any penalty from accruing or
any lien or charge from attaching to its property.

            (h) After consultation with Borrower, Bank may in its own name or in
the name of others communicate with account debtors in order to verify with them
to Bank's reasonable satisfaction the existence, amount and terms of any
Accounts.

            (i) This Agreement may but need not be supplemented by separate
assignments of Accounts and if such assignments are given the rights and
security interests given thereby shall be in addition to and not in limitation
of the rights and security interests given by this Agreement.

            (j) If any of Borrower's Accounts arise out of contracts with the
United States or

                                      -28-


any department, agency, or instrumentality thereof, Borrower will promptly
notify Bank thereof in writing and while an Event of Default exists execute any
instruments and take any steps required by Bank in order that all monies due and
to become due under such contracts shall be assigned to Bank and notice thereof
given to the Government under the Federal Assignment of Claims Act.

            (k) If any of Borrower's Accounts should be evidenced by promissory
notes, trade acceptances, or other instruments for the payment of money,
Borrower will promptly deliver same to Bank, appropriately endorsed to Bank's
order and, regardless of the form of such endorsement, Borrower hereby waives
presentment, demand, notice of dishonor, protest and notice of protest and all
other notices with respect thereto.

            (l) If any goods are at any time in the possession of a bailee,
Borrower shall promptly notify Bank thereof and, if reasonably requested by
Bank, shall promptly obtain an acknowledgment from the bailee, in form and
substance reasonably satisfactory to Bank, that the bailee holds such Collateral
for the benefit of Bank and shall act upon the instructions of Bank, without the
further consent of Borrower, during an Event of Default. Bank agrees with
Borrower that Bank shall not give any such instructions unless an Event of
Default has occurred and is continuing or would occur after taking into account
any action by Borrower with respect to the bailee.

            (m) If Borrower is at any time a beneficiary under a letter of
credit now or hereafter issued in favor of Borrower, Borrower shall promptly
notify Bank thereof and, at the reasonable request and option of Bank, Borrower
shall, pursuant to an agreement in form and substance reasonably satisfactory to
Bank, either (i) arrange for the issuer and any confirmer of such letter of
credit to consent to an assignment to Bank of the proceeds of any drawing under
the letter of credit, or (ii) arrange for Bank to become the transferee
beneficiary of the letter of credit, with Bank agreeing, in each case, that the
proceeds of any drawing under the letter of credit are to be applied in the same
manner as any other payment on an Account.

            (n) If Borrower shall at any time hold or acquire a commercial tort
claim, Borrower shall promptly notify Bank in a writing signed by Borrower of
the brief details thereof and grant to Bank in such writing a security interest
therein, and in the proceeds thereof, all upon the terms of this Agreement, with
such writing to be in form and substance reasonably satisfactory to Bank.

            (o) Borrower will promptly pay when due all taxes and assessments
upon the Collateral or for its use or operation or upon this Agreement, or upon
any note or notes evidencing the Obligations, and will, at the reasonable
request of Bank, promptly furnish Bank the receipted bills therefor. At its
option, Bank may discharge taxes, liens or security interests or other
encumbrances at any time levied or placed on the Collateral, may pay for
insurance on the Collateral and may pay for the maintenance and preservation of
the Collateral. Borrower agrees to reimburse Bank on demand for any payments
made, or any expenses incurred by Bank pursuant to the foregoing authorization,
and upon failure of the Borrower so to reimburse Bank, any such sums paid

                                      -29-


or advanced by Bank shall be deemed secured by the Collateral and constitute
part of the Obligations.

            (p) Borrower will promptly notify Bank upon receipt of notification
of any potential or known release of hazardous materials, hazardous waste,
hazardous or toxic substance or oil from any site operated by Borrower or of the
incurrence of any expense or loss in connection therewith or with the Borrower's
obtaining knowledge of any investigation, action or the incurrence of any
expense or loss by any governmental authority in connection with the assessment,
containment or removal of any hazardous material or oil for which expense or
loss the Borrower may be liable. As used herein, the terms "hazardous waste,"
"hazardous or toxic substance," "hazardous material" or "oil" shall have the
same meanings as defined and used in any of the following (the "Acts") the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42
USC Sections 9601-9657, as amended by the Superfund Accounts and Reauthorization
Act of 1986, the Federal Resource Conservation and Recovery Act, 42 USC Sections
6901 et seq, the Hazardous Materials Transportation Act, 49 USC Sections 1801 et
seq, the Toxic Substances Control Act, 15 USC Sections 2601 et seq, the Federal
Water Pollution Control Act, 33 USC Sections 1251 et seq, the Clean Air Act, 42
USC Sections 741 et seq, the Clean Water Act, 33 USC Section 701, the Safe
Drinking Water Act, 42 USC Sections 300(f)-300(j), M.G.L.A.c 21E (Massachusetts
Oil and Hazardous Material Release Prevention Act), M.G.L.A.c 21C (Massachusetts
Hazardous Waste Management Act), and/or the regulations adopted and publications
promulgated pursuant to any of the Acts, as the same may be amended from time to
time.

            (q) Except for Bank's gross negligence or willful misconduct or
failure to comply with this Agreement, Borrower will indemnify and save Bank
harmless from all loss, costs, damage, liability or expenses (including, without
limitation, court costs and reasonable attorneys' fees) that Bank may sustain or
incur by reason of defending or protecting this security interest or the
priority thereof or enforcing the Obligations, or in the prosecution or defense
of any action or proceeding concerning any matter growing out of or in
connection with this Agreement and/or any other documents now or hereafter
executed in connection with this Agreement and/or the Obligations and/or the
Collateral. This indemnity shall survive the repayment of the Obligations and
the termination of Bank's agreement to make loans available to Borrower and the
termination of this Agreement.

            (r) Upon the reasonable request of Bank, Borrower will furnish to
Bank, from time to time, within five (5) days after the accrual in accordance
with applicable law of Borrower's obligation to make deposits for F.I.C.A. and
withholding taxes and/or sales taxes, proof reasonably satisfactory to Bank that
such deposits have been made as required.

            (s) Should Borrower fail to make any of such deposits or furnish
such proof then Bank may, in its sole and absolute discretion, (a) make any of
such deposits or any part thereof, (b) pay such taxes, or any part thereof, or
(c) set-up such reserves as Bank, in its judgment, shall deem necessary to
satisfy the liability for such taxes. Each amount so deposited or paid shall
constitute an advance under the terms hereof, repayable on demand with interest,
as provided herein, and secured

                                      -30-


by all Collateral and any other property at any time pledged by Borrower with
Bank. Nothing herein shall be deemed to obligate Bank to make any such deposit
or payment or set-up such reserve and the making of one or more of such deposits
or payments or the setting-up of such reserve shall not constitute (i) an
agreement on Bank's part to take any further or similar action, or (ii) a waiver
of any default by Borrower under the terms hereof.

            (t) All advances by Bank to Borrower under this Agreement and under
any other agreement constitute one general revolving fluctuating loan, and all
indebtedness of Borrower to Bank under this and under any other agreement
constitute one general Obligation. Each advance to Borrower hereunder or
otherwise shall be made upon the security of all of the Collateral held and to
be held by Bank. It is distinctly understood and agreed that all of the rights
of Bank contained in this Agreement shall likewise apply, insofar as applicable,
to any modification of or supplement to this Agreement and to any other
agreements between Bank and Borrower. Any default of this Agreement by Borrower
shall constitute, likewise, a default by Borrower of any other existing
agreement with Bank, and any default by Borrower of any other agreement with
Bank shall constitute a default of this Agreement. The entire Obligation of
Borrower to Bank shall become due and payable upon termination of this
Agreement.

            (u) Borrower hereby grants to Bank for a term to commence on the
date of this Agreement and continuing thereafter until all debts and Obligations
of any kind or character owing from Borrower to Bank are fully paid and
discharged, the right to use all premises or places of business which Borrower
presently has or may hereafter have and where any of the Collateral may be
located, at a total rental for the entire period of $ 1.00 Bank agrees not to
exercise the rights granted in this paragraph unless and until Bank determines
to exercise its rights against the Collateral.

            (v) Borrower will, at its expense, upon the reasonable request of
Bank promptly and duly execute and deliver such documents and assurances and
take such actions as may be necessary or desirable or as Bank may reasonably
request in order to correct any defect, error or omission which may at any time
be discovered or to more effectively carry out the intent and purpose of this
Agreement and to establish, perfect and protect Bank's security interest, rights
and remedies created or intended to be created hereunder. Without limiting the
generality of the above, Borrower will join with Bank in executing financing and
continuation statements pursuant to the Uniform Commercial Code or other notices
appropriate under applicable Federal or state law in form reasonably
satisfactory to Bank and filing the same in all public offices and jurisdictions
wherever and whenever reasonably requested by Bank.

            (w) Borrower shall perform any and all further steps reasonably
requested by Bank to perfect Bank's security interest in Inventory, such as
leasing warehouses to Bank or its designee, placing and maintaining signs,
appointing custodians, maintaining stock records and transferring Inventory to
warehouses. A physical listing of all Inventory, wherever located, shall be
taken by Borrower at least annually and whenever requested by Bank if one or
more of the Events of Default exist.

                                      -31-


            (x) Borrower hereby grants to Bank for a term to commence on the
date of this Agreement and continuing thereafter until all debts and Obligations
of any kind or character owed to Bank are fully paid and discharged, a
non-exclusive irrevocable royalty-free license in connection with Bank's
exercise of its rights hereunder, to use, apply or affix any trademark, trade
name logo or the like and to use any patents, in which the Borrower now or
hereafter has rights, which license may be used by Bank upon and after the
occurrence of any one or more of the Events of Default, provided, however, that
such use by Bank shall be suspended if such Events of Default are cured.

      17. BORROWER'S NEGATIVE COVENANTS. Borrower will not at any time

            (a) (Capital Base) permit its tangible capital base to be less than
$7,2000,000 during the first calendar quarter of each year, $4,300,000 during
the second calendar quarter of each year, $8,700,000 during the third calendar
quarter of each year, and $13,500,000 during the fourth calendar quarter of each
year,

            (b) (Subchapter S Corporation) if Borrower is a Subchapter S
corporation, make distributions to its shareholders during any fiscal year of
Borrower in an aggregate amount greater than the amount necessary to pay federal
and state income taxes upon Borrower's undistributed income for such year,

            (c) (Disposition of Collateral) sell, assign, exchange or otherwise
dispose of any of the Collateral, other than Inventory consisting of (i) scrap,
waste, defective goods and the like, (ii) obsolete goods, (iii) finished goods
sold in the ordinary course of business or any interest therein to any
individual, partnership, trust or other corporation, and Equipment which is no
longer required or deemed necessary for the conduct of Borrower's business, so
long as Borrower receives therefor a sum substantially equal to such Equipment's
fair value, remits such sum to Bank in accordance with the terms of this
Agreement or replaces such Equipment with other equipment of similar value which
is subject to a first security interest in Bank's favor,

            (d) (Liens) create, permit to be created or suffer to exist any
lien, encumbrance or security interest of any kind ("LIEN") upon any of the
Collateral or any other property of Borrower, now owned or hereafter acquired,
except (i) landlords', carriers', warehousemen's, mechanics' and other similar
liens arising by operation of law in the ordinary course of Borrower's business,
(ii) arising out of pledge or deposits under worker's compensation, unemployment
insurance, old age pension, social security, retirement benefits or other
similar legislation, (iii) purchase money Liens arising in the ordinary course
of business for the purchase of equipment (so long as the indebtedness secured
thereby does not exceed the lesser of the cost or fair market value of the
property subject thereto, and such Lien extends to no other property), (iv)
Liens for unpaid taxes that are either (x) not yet due and payable, or (y) are
subject of permitted protests, (v) Liens which are the subject of permitted
protests, (vi) those Liens and encumbrances set forth on Schedule "B" annexed
hereto, and (vii) in favor of Bank, the term "permitted protests" as used herein
means the right of the Borrower to protest any Lien (other than a Lien that
secures the Obligations), tax (other than payroll taxes or taxes that are the
subject of a federal or state tax lien) or rental payment, provided that (x) a
reserve

                                      -32-


with respect to such liability is established on the books of the Borrower in an
amount that is reasonably satisfactory to the Bank, (y) any such protest is
instituted and diligently prosecuted by the Borrower in good faith, and (z) the
Bank is reasonably satisfied that, while such protest is pending, there will be
no impairment of the enforceability, validity or priority of any of the Liens of
the Bank in and to the Collateral,

            (e) (Dividends) pay any dividends on or make any distribution on
account of (except, if Borrower is a Subchapter S corporation, consistent with
paragraph (b) above) any class of Borrower's capital stock in cash or in
property (other than additional shares of such stock), or redeem, purchase or
otherwise acquire, directly or indirectly, any of such stock, other than stock
purchased or redeemed from departing employees, officers, directors or
consultants,

            (f) (Loans) make any loans or advances to any individual,
partnership, trust or other corporation, including without limitation Borrower's
directors, officers and employees, except advances to officers or employees with
respect to expenses incurred by them in the ordinary course of their duties
which are properly reimbursable by Borrower,

            (g) (Guarantees) assume, guaranty, endorse or otherwise become
directly or contingently liable in respect of (including without limitation by
way of agreement, contingent or otherwise, to purchase, provide funds to or
otherwise invest in a debtor or otherwise to assure a creditor against loss),
any indebtedness (except guarantees by endorsement of instruments for deposit or
collection in the ordinary course of business and guarantees in favor of Bank)
of any individual, partnership, trust or other corporation,

            (h) (Investments) (i) use any loan proceeds to purchase or carry any
"margin stock" (as defined in Regulation U of the Board of Governors of the
Federal Reserve System) or (ii) invest in or purchase any stock or securities of
any individual, partnership, trust or other corporation except (x) readily
marketable direct obligations of, or obligations guaranteed by, the United
States of America or any agency thereof or (y) time deposits with or
certificates of deposit issued by the Bank,

            (i) (Transactions with Affiliates) enter into any lease or other
transaction with any shareholder, officer or affiliate on terms any less
favorable than those which might be obtained at the time from persons who (or
entities which) are not such a shareholder, officer or affiliate,

            (j) (Subsidiaries) sell, transfer or otherwise dispose of any stock
of any subsidiary of Borrower,

            (k) (Mergers, Consolidations or Sales) (i) merge or consolidate with
or into any corporation other than in connection with a Permitted Acquisition,
(ii) enter into any joint venture or partnership with any person, firm or
corporation, (iii) convey, lease or sell all or any material portion of its
property or assets or business to any other person, firm or corporation, except
for the sale of Inventory in the ordinary course of its business, or (iv)
convey, lease or sell any of its assets to any person, firm or corporation for
less than the fair market value thereof. For purposes of this section

                                      -33-


"PERMITTED ACQUISITION" shall mean the acquisition by Borrower of any entity,
business, division, or specified group of assets (other than capital assets
acquired as a result of capital expenditures if Borrower made in the ordinary
course of business), provided that each of the following conditions is met with
respect to any such acquisition:

            (a) immediately prior to and after giving effect to such
acquisition, no Event of Default shall then exist, and Borrower shall have
delivered to the Bank a certificate of its chief financial officer to the effect
that immediately prior to and after giving effect to such acquisition, no Event
of Default exists and attaching, in reasonable detail, computations evidencing
compliance with the covenant contained in Section 17(a), immediately prior to
and after giving effect to such acquisition,

            (b) (i) the aggregate consideration paid or to be paid by Borrower
in connection with such acquisitions after the Closing Date shall not, without
the prior written consent of the Bank, exceed $10,000,000 as to any individual
acquisition or group of related acquisitions and (ii) the aggregate
consideration to be paid in cash as to all such acquisitions in the aggregate
during any period of twelve (12) consecutive months shall not, without the prior
written consent of the Bank, exceed $15,000,000, and

            (c) either

                  (i) such acquisition is the acquisition of assets for use in
            the same line of business as (or a line of business substantially
            similar or related to) the line of business of the Borrower, or such
            acquisition represents a brand extension opportunity, and the Bank
            shall concurrently with the closing of the acquisition be granted a
            first priority security interest (subject only to Liens permitted
            hereunder) in such acquired assets, or

                  (ii) such acquisition involves the purchase of the equity
            interest of an entity and the following conditions are met:

                        (A) such entity is in the same line of business (or a
                  substantially similar or related line of business) as
                  Borrower, or such purchase represents a brand extension
                  opportunity, and

                        (B) contemporaneously with the occurrence of such
                  acquisition, Borrower shall cause such acquired entity to
                  either (i) become a party to this Agreement or (ii) provide a
                  guaranty of Borrower's obligations hereunder, in form and
                  substance reasonably satisfactory to the Bank.

            (1) (Change in Legal Status) (i) Change its name, its place of
business or, if more than one, chief executive office, or its mailing address or
organizational identification number if it has one, and (ii) change its type of
organization, jurisdiction or organization or other legal structure

                                      -34-


If the Borrower does not have an organizational identification number and later
obtains one, the Borrower shall forthwith notify the Lender of such
organizational identification number.

            For purposes of this section "Affiliate" shall mean any person or
entity (i) which directly or indirectly controls, or is controlled by or is
under common control with the Borrower or a subsidiary, (ii) which directly or
indirectly beneficially holds or owns ten (10%) percent or more of any class of
voting stock of the Borrower or any subsidiary, or (iii) ten (10%) percent or
more of the voting stock of which is directly or indirectly beneficially owned
or held by the Borrower or a subsidiary, "Capital Leases" shall mean capital
leases, conditional sales contracts and other title retention agreements
relating to the purchase or acquisition of capital assets, "Control" shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of any person or entity, whether
through the ownership of voting securities, by contract or otherwise,
"Distributions" shall mean all payment or distributions to shareholders in cash
or in property other than reasonable salaries, bonuses and expense
reimbursements, "Indebtedness" shall mean (i) all liabilities for borrowed
money, for the deferred purchase price of property or services, and under leases
which are or should be, under generally accepted accounting principles, recorded
as capital leases, in respect of which a person or entity is directly or
indirectly, absolutely or contingently liable as obligor, guarantor, endorser or
otherwise, or in respect of which such person or entity otherwise assures a
creditor against loss, and (ii) all liabilities of the type described in (i)
above which are secured by (or for which the holder has an existing right,
contingent or otherwise, to be secured by) any lien upon property owned by such
person or entity, whether or not such person or entity has assumed or become
liable for the payment thereof, "Interest" shall mean, for the applicable
period, all interest paid or payable, including, but not limited to, interest
paid or payable on indebtedness and on capital leases, determined in accordance
with generally accepted accounting principles, "Tangible Capital Base" shall
mean Borrower's tangible net worth plus its subordinated indebtedness, and
"Tangible Net Worth" shall mean Borrower's stockholders' equity determined in
accordance with generally accepted accounting principles, consistently applied,
subtracting therefrom (i) intangibles (as determined in accordance with such
principles so applied) and (ii) accounts and indebtedness owing to Borrower from
any employee or parent, subsidiary or other affiliate of Borrower.

      18 DEFAULT, RIGHTS AND REMEDIES UPON DEFAULT.

            (a) Upon the occurrence and during the continuance of any one or
more of the following events (herein, "Events of Default"), Bank may decline to
make any or all further loans or issue Letters of Credit hereunder or under any
other agreements with Borrower, any and all Obligations of the Borrower to Bank
shall become immediately due and payable, at the option of Bank and without
notice or demand. The occurrence and continuance of any such Event of Default
shall also constitute, without notice or demand, a default under all other
agreements between Bank and the Borrower and instruments and papers given Bank
by the Borrower, whether such agreements, instruments, or papers now exist or
hereafter arise, namely.

                  (iv) The failure by the Borrower to pay when due any
      principal, interest,

                                      -35-


      fees, costs, and expenses due pursuant to the Master Note, the Term Note
      or this Agreement.

                  (v) The failure by the Borrower to pay, when due, any other
      Obligations.

                  (vi) Default by the Borrower in the observance or performance
      of any of the covenants or agreements of the Borrower contained in
      Sections 13(a) or 17 of this Agreement.

                  (vii) The failure by the Borrower to promptly, punctually and
      faithfully perform, or observe any term, covenant or agreement on its part
      to be performed or observed pursuant to any of the provisions of this
      Agreement, other than those described in Sections 5(b), 5(f), 5(h), 13(a),
      13(d), 17, or in any other agreement with Bank which is not remedied
      within ten (10) days after notice thereof by Bank to Borrower.

                  (viii) Any representation or warranty heretofore, now or
      hereafter made by the Borrower to Bank, in any documents, instrument,
      agreement, or paper was not true or accurate when given in any material
      respect.

                  (ix) The occurrence of any event such that any material
      indebtedness of the Borrower from any lender other than Bank could be
      accelerated, notwithstanding that such acceleration has not taken place.

                  (x) The occurrence of any event which would cause a lien
      creditor, as that term is defined in Section 9-102 of the Code, to take
      priority over advances made by Bank.

                  (xi) A filing against or relating to the Borrower of (A) a
      federal tax lien in favor of the United States of America or any political
      subdivision of the United States of America, or (B) a state tax lien in
      favor of any state of the United States of America or any political
      subdivision of any such state.

                  (xii) The occurrence of any event of default under any
      agreement between Bank and the Borrower or instrument or paper given Bank
      by the Borrower, whether such agreement, instrument, or paper now exists
      or hereafter arises (notwithstanding that Bank may not have exercised its
      rights upon default under any such other agreement, instrument or paper).

                  (xiii) Any act by, against, or relating to the Borrower, or
      its property or assets, which act constitutes the application for, consent
      to, or sufferance of the appointment of a receiver, trustee or other
      person, pursuant to court action or otherwise, over all, or any part of
      the Borrower's property.

                  (xiv) The granting of any trust mortgage or execution of an
      assignment for

                                      -36-


      the benefit of the creditors of the Borrower, or the occurrence of any
      other voluntary or involuntary liquidation or extension of debt agreement
      for the Borrower, the failure by the Borrower to generally pay the debts
      of the Borrower as they mature, adjudication of bankruptcy or insolvency
      relative to the Borrower, the entry of an order for relief or similar
      order with respect to the Borrower in any proceeding pursuant to Title 11
      of the United States Code entitled "Bankruptcy" (hereinafter the
      "Bankruptcy Code") or any other federal Bankruptcy law, the filing of any
      complaint, application, or petition by or against the Borrower initiating
      any matter in which the Borrower is or may be granted any relief from the
      debts of the Borrower pursuant to the Bankruptcy Code or any other
      insolvency statute or procedure, the calling or sufferance of a meeting of
      creditors of the Borrower, the meeting by the Borrower of a formal or
      informal creditor's committee, the offering by or entering into by the
      Borrower of any composition, extension or any other arrangement seeking
      relief or extension for the debts of the Borrower, or the initiation of
      any other judicial or non-judicial proceeding or agreement by, against or
      including the Borrower which seeks or intends to accomplish a
      reorganization or arrangement with creditors.

                  (xv) The entry of any material judgment(s) against Borrower,
      which judgment(s) is not satisfied or appealed from (with execution or
      similar process stayed) within fifteen (15) days of its entry.

                  (xvi) [reserved].

                  (xvii) The entry of any court order which enjoins, restrains
      or in any way prevents the Borrower from conducting all or any substantial
      part of its business affairs in the ordinary course of business.

                  (xviii) The service of any process upon Bank seeking to attach
      by trustee process any funds of the Borrower on deposit with Bank.

                  (xix) The termination, resignation or departure of the Chief
      Executive Officer and the Chief Financial Officer of the Borrower, who are
      not replaced within three (3) months with officers reasonably satisfactory
      to the Bank, and/or any direct or indirect change of control of the voting
      capital stock of the Borrower from that existing at the execution of this
      Agreement such that the current stockholders own less than a majority of
      the issued and issuable voting capital stock of the Borrower.

                  (xx) The occurrence of any material uninsured loss, theft,
      damage or destruction to any material asset(s) of the Borrower.

                  (xxi) Any act by or against, or relating to the Borrower or
      its assets pursuant to which any creditor of the Borrower seeks to reclaim
      or repossess or reclaims or repossesses all or a portion of the Borrower's
      assets.

                                      -37-


                  (xxii) The termination of existence, dissolution, or
      liquidation of the Borrower, or the ceasing to carry on actively any
      substantial part of Borrower's current business.

                  (xxiii) This Agreement shall, at any time after its execution
      and delivery and for any reason, cease (A) to create a valid and perfected
      first priority security interest in and to the Collateral purported to be
      subject to this Agreement, or (B) to be in full force and effect or shall
      be declared null and void, or the validity or enforceability hereof shall
      be contested by the Borrower.

                  (xxiv) Any of the following events occur or exist with respect
      to the Borrower or any ERISA affiliate (A) any "prohibited transaction"
      (as defined in Section 406 of ERISA or Section 4975 of the Internal
      Revenue Code) involving any Plan, (B) any "reportable event" (as defined
      in Section 4043 of ERISA and the regulations issued under such Section)
      shall occur with respect to any Plan, (C) The filing under Section 4041 of
      ERISA of a notice of intent to terminate any Plan or the termination of
      any Plan, (D) any event or circumstance exists which might constitute
      grounds entitling the Pension Benefit Guaranty Corporation (PBGC) to
      institute proceedings under Section 4042 of ERISA for the termination of,
      or for the appointment of a trustee to administer, any Plan, or the
      institution by the PBGC of any such proceedings, or (E) partial withdrawal
      under Section 4201 or 4204 of ERISA from a Multiemployer Plan or the
      reorganization, insolvency, or termination of any Multiemployer Plan, and
      in each case above, such event or condition, together with all other
      events or conditions, if any, could in the opinion of Bank subject the
      Borrower to any tax, penalty, or other liability to a Plan, a
      Multiemployer Plan, the PBGC, or otherwise.

                  Upon the occurrence and during the continuance of an Event of
      Default, Bank may declare any obligation Bank may have hereunder to be
      cancelled, declare all Obligations of Borrower to be due and payable and
      proceed to enforce payment of the Obligations and to exercise any and all
      of the rights and remedies afforded to Bank by the Uniform Commercial Code
      or under the terms of this Agreement or otherwise. In addition, upon the
      occurrence and during the continuance of an Event of Default, if Bank
      proceeds to enforce payment of the Obligations, Borrower shall be
      obligated to deliver to Bank cash collateral in an amount equal to the
      aggregate amounts then undrawn on all outstanding Letters of Credit or
      acceptances issued or guaranteed by Bank for the account of Borrower, and
      Bank may proceed to enforce payment of the same and to exercise all rights
      and remedies afforded to Bank by the Uniform Commercial Code or under the
      terms of this Agreement or otherwise. Upon the occurrence of, and during
      the continuance of, an Event of Default, the Borrower, as additional
      compensation to the Bank for its increased credit risk, promises to pay
      interest on all Obligations (including, without limitation, principal,
      whether or not past due, past due interest and any other amounts past due
      under this Agreement) at a per annum rate of five (5%) percent greater
      than the rate of interest then specified in Section 7 of this Agreement.

                                      -38-


            (b) Upon the filing of any complaint, application, or petition by or
against the Borrower initiating any matter in which the Borrower is or may be
granted any relief from the debts of the Borrower pursuant to the Bankruptcy
Code, Bank's obligation hereunder shall be canceled immediately, automatically,
and without notice, and all Obligations of the Borrower then outstanding shall
become immediately due and payable without presentation, demand, or notice of
any kind to the Borrower, provided, however, it shall not be an Event of Default
hereunder if any such complaint is filed against the Borrower which is being
diligently contested by Borrower until the earlier of (i) the entry of an order
for relief, or (ii) sixty (60) days without the dismissal of such complaint.

            (c) Any sale or other disposition of the Collateral may be at public
or private sale upon such terms and in such manner as the Bank deems advisable,
having due regard to compliance with any statute or regulation which might
affect, limit or apply to the Bank's disposition of the Collateral. The Bank may
conduct any such sale or other disposition of the Collateral upon the Borrower's
premises. Unless the Collateral is perishable or threatens to decline speedily
in value, or is of a type customarily sold on a recognized market (in which
event the Bank shall provide the Borrower with such notice as may be practicable
under the circumstances), the Bank shall give the Borrower at least the greater
of the minimum notice required by law or ten (10) days prior written notice of
the date, time and place of any proposed public sale, and of the date after
which any private sale or other disposition of the Collateral may be made. The
Bank may purchase the Collateral, or any portion of it at any public sale.

            (d) If the Bank sells any of the Collateral on credit, the Borrower
will be credited only with payments actually made by the purchaser of such
Collateral and received by the Bank. If the purchaser fails to pay for the
Collateral, the Bank may re-sell the Collateral and the Borrower shall be
credited with the proceeds of the sale.

            (e) In connection with the Bank's exercise of the Bank's rights
after the occurrence and during the continuance of an Event of Default, the
Bank, in accordance with applicable law, peaceably may enter upon, occupy and
use any premises owned or occupied by the Borrower, and may exclude the Borrower
from such premises or portion thereof as may have been so entered upon,
occupied, or used by the Bank. The Bank shall not be required to remove any of
the Collateral from any such premises upon the Bank's taking possession thereof,
and may render any Collateral unusable to the Borrower. In no event shall the
Bank be liable to the Borrower for use or occupancy by the Bank of any premises
pursuant to this Agreement.

            (f) Upon the occurrence and during the continuance of any Event of
Default, the Bank may require the Borrower to assemble the Collateral and make
it available to the Bank at the Borrower's sole risk and expense at a place or
places which are reasonably convenient to both the Bank and the Borrower.

      19. STANDARDS FOR EXERCISING REMEDIES. To the extent that applicable law
imposes duties on Bank to exercise remedies in a commercially reasonable manner,
Borrower

                                      -39-


acknowledges and agrees that it is not commercially unreasonable for Bank (a) to
fail to incur expenses reasonably deemed significant by Bank to prepare
Collateral for disposition or otherwise to complete raw material or work in
process into finished goods or other finished products for disposition, (b) to
fail to obtain third party consents for access to Collateral to be disposed of,
or to obtain or, if not required by other law, to fail to obtain governmental or
third party consents for the collection or disposition of Collateral to be
collected or disposed of, (c) to fail to exercise collection remedies against
account debtors or other persons obligated on Collateral or to remove liens or
encumbrances on or any adverse claims against Collateral, (d) to exercise
collection remedies against account debtors and other persons obligated on
Collateral directly or through the use of collection agencies and other
collection specialists, (e) to advertise dispositions of Collateral through
publications or media of general circulation, whether or not the Collateral is
of a specialized nature, (f) to contact other persons, whether or not in the
same business as Borrower, for expressions of interest in acquiring all or any
portion of the Collateral, (g) to hire one or more professional auctioneers to
assist in the disposition of Collateral, whether or not the Collateral is of a
specialized nature, (h) to dispose of the Collateral by utilizing Internet sites
that provide for the auction of assets of the types included in the Collateral
or that have the reasonable capability of doing so, or that match buyers and
sellers of assets, (i) to dispose of assets in wholesale rather than retail
markets, (j) to disclaim disposition warranties specifically to disclaim any
warranties of title or the like, (k) to purchase insurance or credit
enhancements to insure Bank against risks of loss, collection or disposition of
Collateral or to provide to Bank a guaranteed return from the collection or
disposition of Collateral, or (l) to the extent deemed appropriate by Bank, to
obtain the services of other brokers, investment bankers, consultants and other
professionals to assist Bank in the collection or disposition of any of the
Collateral Borrower acknowledges that the purpose of this section is to provide
non-exhaustive indications of what actions or omissions by Bank would not be
commercially unreasonable in Bank's exercise of remedies against the Collateral
and that other actions or omissions by Bank shall not be deemed commercially
unreasonable solely on account of not being indicated in this section. Without
limitation upon the foregoing, nothing contained in this section shall be
construed to grant any rights to Borrower or to impose any duties on Bank that
would not have been granted or imposed by this Agreement or by applicable law in
the absence of this section.

      20. PROCESSING AND SALES OF INVENTORY. So long as Borrower is not in
default hereunder, Borrower shall have the right, in the regular course of
business, to process and sell Borrower's Inventory, and, except for any
interests in the proceeds thereof, such sale shall be free and clear of the
security interest granted to the Bank hereunder. A sale in the ordinary course
of business shall not include a transfer in total or partial satisfaction of a
debt.

      21. WAIVER OF JURY TRIAL. BORROWER AND BANK EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE OR HEREAFTER HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT. Borrower hereby certifies that neither Bank nor any
of its representatives, agents or counsel has represented, expressly or
otherwise, that Bank would not, in the event of any such suit, action or
proceeding, seek to enforce this waiver of right to trial by jury. Borrower
acknowledges that Bank has been induced to

                                      -40-



enter into this Agreement by, among other things, this waiver. Borrower
acknowledges that it has read the provisions of this Agreement and in
particular, this section, has consulted legal counsel, understands the right it
is granting in this Agreement and is waiving in this section in particular, and
makes the above waiver knowingly, voluntarily and intentionally.

      22. CONSENT TO JURISDICTION. Borrower and Bank agree that any action or
proceeding to enforce or arising out of this Agreement may be commenced in any
court of the Commonwealth of Massachusetts sitting in the counties of Suffolk or
Middlesex, or in the District Court of the United States for the District of
Massachusetts, and Borrower waives personal service of process and agrees that a
summons and complaint commencing an action or proceeding in any such court shall
be properly served and confer personal jurisdiction if served by registered or
certified mail to Borrower, or as otherwise provided by the laws of the
Commonwealth of Massachusetts or the United States of America.

      23. TERMINATION.

            (a) Unless renewed in writing, this Agreement solely as it relates
to the Line of Credit shall terminate on May 26, 2007 (the "TERMINATION DATE"),
and all Obligations as they relate to the Line of Credit shall be due and
payable in full without presentation, demand, or further notice of any kind,
whether or not all or any part of the Obligations is otherwise due and payable
pursuant to the agreement or instrument evidencing same. Bank may terminate this
Agreement immediately and without notice upon the occurrence and during the
continuance of an Event of Default. Notwithstanding the foregoing or anything in
this Agreement or elsewhere to the contrary, the security interest, Bank's
rights and remedies hereunder and Borrower's obligations and liabilities
hereunder shall survive any termination of this Agreement and shall remain in
full force and effect until all of the Obligations outstanding, or contracted or
committed for (whether or not outstanding), shall be finally and irrevocably
paid in full, and shall thereupon terminate. No Collateral shall be released or
financing statement terminated until such final and irrevocable payment in full
of the Obligations, as described in the preceding sentence, whereupon all
Collateral shall be released and the Bank shall take all action reasonably
requested by the Borrower to terminate or authorize the termination of all
financing statements and comparable documents.

            (b) In the event that Bank continues to make loans under the Line of
Credit after the Termination Date without a written extension of such
Termination Date or after the occurrence of and during the continuance of an
Event of Default, all such loans (i) shall be made in the sole and absolute
discretion of Bank, and (ii) shall, together with all other Obligations, be
payable thereafter ON DEMAND.

      24. ARBITRATION.

            (a) Except to the extent expressly provided below, any Dispute (as
defined below) shall, upon the request of either party, be determined by binding
arbitration in accordance with the Federal Arbitration Act, Title 9, United
States Code (or if not applicable, the applicable state law),

                                      -41-



the applicable rules for arbitration of disputes of the Judicial and Mediation
Service ("JAMS") and the "Special Rules" set forth below "Dispute" means any
controversy, claim or dispute between or among the parties to this Loan
Agreement, including any controversy, claim or dispute arising out of or
relating to (a) this Loan Agreement, (b) any other Loan Documents, (c) any
related agreements or instruments, or (d) the transaction contemplated herein or
therein (including any claim based on or arising from an alleged personal injury
or business tort). In the event of any inconsistency, the Special Rules shall
control. The filing of a court action is not intended to constitute a waiver of
the right of Borrower, Guarantor or Bank, including the suing party, thereafter
to require submittal of the Dispute to arbitration. Any party to this Loan
Agreement may bring an action, including a summary or expedited proceeding, to
compel arbitration of any Dispute in any court having jurisdiction over such
action. For the purposes of this dispute resolution provision only, the terms
"party" and "parties" shall include any parent corporation, subsidiary or
affiliate of Bank involved in the servicing, management or administration of any
obligation described in or evidenced by this Loan Agreement, together with the
officers, employees, successors and assigns of each of the foregoing.

            (b) (i) The arbitration shall be conducted in Boston, Massachusetts.

                (ii) The arbitration shall be administered by JAMS, who will
                appoint an arbitrator, if JAMS is unable or legally precluded
                from administering the arbitration, then the American
                Arbitration Association will serve. All Disputes shall be
                determined by one arbitrator, however, if the amount in
                controversy in a Dispute exceeds Five Million Dollars
                ($5,000,000), upon the request of any party, the Dispute shall
                be decided by three arbitrators (for purposes of this Loan
                Agreement, referred to collectively as the "arbitrator").

                (iii) All arbitration hearings will be commenced within ninety
                (90) days of the demand for arbitration and completed within
                ninety (90) days from the date of commencement, provided,
                however, that upon a showing of good cause, the arbitrator shall
                be permitted to extend the commencement of such hearing for up
                to an additional sixty (60) days.

                (iv) The judgment and the award, if any, of the arbitrator shall
                be issued within thirty (30) days of the close of the hearing.
                The arbitrator shall provide a concise written statement setting
                forth the reasons for the judgment and for the award, if any.
                The arbitration award, if any, may be submitted to any court
                having jurisdiction to be confirmed and enforced, and such
                confirmation and enforcement shall not be subject to
                arbitration.

                (v) The arbitrator will have the authority to decide whether any
                Dispute is barred by the statute of limitations and, if so, to
                dismiss the arbitration on that basis. For purposes of the
                application of the statute of limitations, the service on JAMS
                under applicable JAMS rules of a notice of Disputes is the
                equivalent of the filing of a lawsuit.

                (vi) Any dispute concerning this arbitration provision,
                including any such dispute as to the validity or enforceability
                of this provision, or whether a

                                      -42-



                Dispute is arbitrable, shall be determined by the arbitrator.

                (vii) The arbitrator shall have the power to award legal fees
                and costs pursuant to the terms of this Loan Agreement.

      (c) Nothing in this Loan Agreement shall be deemed to (i) limit the
applicability of any otherwise applicable statutes of limitation and any waivers
contained in this Loan Agreement, or (ii) apply to or limit the right of Bank
(A) to exercise self help remedies such as (but not limited to) setoff, or (B)
to foreclose judicially or nonjudicially against any real or personal property
collateral, or to exercise judicial or nonjudicial power of sale rights, (C) to
obtain from a court provisional or ancillary remedies such as (but not limited
to) injunctive relief, writ of possession, prejudgment attachment, or the
appointment of a receiver, or (D) to pursue rights against a party to this Loan
Agreement in a third-party proceeding in any action brought against Bank in a
state, federal or international court, tribunal or hearing body (including
actions in specialty courts, such as bankruptcy and patent courts). Bank may
exercise the rights set forth in clauses (A) through (D), inclusive, before,
during or after the pendency of any arbitration proceeding brought pursuant to
this Loan Agreement. Neither the exercise of self help remedies nor the
institution or maintenance of an action for foreclosure or provisional or
ancillary remedies shall constitute a waiver of the right of any party,
including the claimant in any such action, to arbitrate the merits of the
Dispute occasioning resort to such remedies. No provision in the Loan Documents
regarding submission to jurisdiction and/or venue in any court is intended or
shall be construed to be in derogation of the provisions in any Loan Document
for arbitration of any Dispute.

      (d) If there is any conflict between the terms, conditions and provisions
of this Section and those of any other provision or agreement for arbitration or
dispute resolution, the terms, conditions and provisions of this Section shall
prevail as to any Dispute arising out of or relating to (i) this Loan Agreement,
(ii) any other Loan Document, (iii) any related agreements or instruments, or
(iv) the transaction contemplated herein or therein (including any claim based
on or arising from an alleged personal injury or business tort). In any other
situation, if the resolution of a given Dispute is specifically governed by
another provision or agreement for arbitration or dispute resolution, the other
provision or agreement shall prevail with respect to said Dispute.

      (e) By agreeing to this Section, the parties irrevocably and voluntarily
waive any right they may have to a trial by jury in respect of any Dispute.

      25. MISCELLANEOUS.

            (a) No delay or omission on the part of Bank in exercising any
rights shall operate as a waiver of such right or any other right. Waiver on any
one occasion shall not be construed as a bar to or waiver of any right or remedy
on any future occasion. All Bank's rights and remedies, whether evidenced hereby
or by any other agreement, instrument or paper, shall be cumulative and may be
exercised singularly or concurrently.

            (b) Bank is authorized to make loans under the terms of this
Agreement upon the

                                      -43-



request, either written or oral, in the name of Borrower or any authorized
person whose name appears at the end of this Agreement or of any of the
following named person, or persons from time to time, holding the following
offices of Borrower, President, Treasurer and such other officers and authorized
signatories as may from time to time be set forth in separate resolutions. Any
request for a loan which is not accompanied by a Notice of Borrowing shall be
deemed a request for a Prime Rate Loan.

            (c) This Agreement shall bind and inure to the benefit of the
respective successors and assigns of each of the parties hereto, provided,
however, that Borrower may not assign this Agreement or any rights or duties
hereunder without Bank's prior written consent and any prohibited assignment
shall be absolutely void. No consent to an assignment by Bank shall release
Borrower from its Obligations. Bank may assign this Agreement and its rights and
duties hereunder and no consent or approval by Borrower is required in
connection with any such assignment. Bank reserves the right to sell, assign,
transfer, negotiate or grant participations in all or any part of, or any
interest in Bank's rights and benefits hereunder. In connection with any
assignment or participation, Bank may disclose all documents and information
which Bank now or hereafter may have relating to Borrower or Borrower's
business. To the extent that Bank assigns its rights and obligations hereunder
to another party, Bank thereafter shall be released from such assigned
obligations to Borrower and such assignment shall effect a novation between
Borrower and such other party.

            (d) Borrower agrees that any and all loans made by Bank to Borrower
or for its account under this Agreement shall be conclusively deemed to have
been authorized by Borrower and to have been made pursuant to duly authorized
requests therefor on its behalf.

            (e) Unless otherwise defined in this Agreement, capitalized words
shall have the meanings set forth in the Uniform Commercial Code as in effect in
the Commonwealth of Massachusetts as of the date of this Agreement.

            (f) Paragraph and section headings used in this Agreement are for
convenience only, and shall not effect the construction of this Agreement. If
one or more provisions of this Agreement (or the application thereof) shall be
invalid, illegal or unenforceable in any respect in any jurisdiction, the same
shall not, invalidate or render illegal or unenforceable such provision (or its
application) in any other jurisdiction or any other provision of this Agreement
(or its application). This Agreement is the entire agreement of the parties with
respect to the subject matter hereof and supersedes any prior written or verbal
communications or instruments relating thereto.

            (g) Unless otherwise provided in this Agreement, all notices or
demands by any party relating to this Agreement or any other loan document shall
be in writing and (except for financial statements and other informational
documents which may be sent by first-class mail, postage prepaid) shall be
personally delivered or sent by registered or certified mail (postage prepaid,
return receipt requested), overnight courier, or telefacsimile to Borrower or to
Bank, as the case may be, at its address set forth below.

                                      -44-



            If to Bank                Fleet National Bank
                                      100 Federal Street
                                      Boston, Massachusetts 02110
                                      Attn. Ms. Debra J. Drapalla,
                                            Senior Vice President
                                      Telephone (617) 434-5395
                                      Telecopier (617) 434-4896

            With a copy to            Goulston & Storrs, P C
                                      400 Atlantic Avenue
                                      Boston, Massachusetts 02110
                                      Attn. James H. Lerner, Esquire
                                      Telephone (617)574-3525
                                      Telecopier (617)574-7607

            If to Borrower            iRobot Corporation
                                      63 South Avenue
                                      Burlington, Massachusetts 01803
                                      Attn. Mr. Joseph P. Mullin
                                      Telephone (781)418-3187
                                      Telecopier (781) 345-0201

            With a copy to            Goodwin Procter LLC
                                      53 State Street
                                      Boston, Massachusetts 02110
                                      Attn. Mark T. Bettencourt, Esquire
                                      Telephone (617) 570-1091
                                      Telecopier (617)523-1231

            The parties hereto may change the address at which they are to
receive notices hereunder, by notice in writing in the foregoing manner given to
the other. All notices or demand sent in accordance with this section shall be
deemed received on the earlier of the date of actual receipt or three (3) days
after the deposit thereof in the mail.

            (h) Bank shall have no obligation to maintain any electronic records
or any documents, schedules, invoices, agings or any other paper delivered to
Bank by Borrower in connection with this Agreement or any other agreement for
more than four (4) months after receipt of the same by Bank.

            (i) Neither this Agreement nor any uncertainty or ambiguity herein
shall be construed or resolved against Bank or Borrower, whether under any rule
of construction or otherwise. On the contrary, this Agreement has been reviewed
by all parties and shall be construed and interpreted according to the ordinary
meaning of the words used so as to fairly accomplish the purposes and intentions
of all parties hereto.

            (j) Each provision of this Agreement shall be severable from every
other

                                      -45-



provision of this Agreement for the purpose of determining the legal
enforceability of any specific provision.

            (k) This Agreement, together with the other documents and
instruments executed concurrently herewith represent the entire and final
understanding of the parties with respect to the transactions contemplated
hereby and shall not be contradicted or qualified by evidence of any prior,
contemporaneous or subsequent other agreement, oral or written, before the date
hereof.

            (l) This Agreement can only be amended by a writing signed by both
Bank and Borrower.

                                      -46-



            (m) Bank may at any time pledge or assign all or any portion of its
rights under the Loan Documents including any portion of this Agreement to any
of the twelve (12) Federal Reserve Banks organized under Section 4 of the
Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or assignment or
enforcement thereof shall release Bank from its obligations under any of the
Loan Documents.

            (n) The laws of Massachusetts shall govern the construction of this
Agreement and the rights and duties of the parties hereto. This Agreement shall
take effect as a sealed instrument.

Witnessed by                          iROBOT CORPORATION

/s/ David Weller                      By /s/ Geoffrey P. Clear
- -----------------                        -----------------------
David Weller
                                      Address 63 South Avenue
                                              Burlington, Massachusetts 01803

                                      FLEET NATIONAL BANK, a Bank of America
                                      company

                                      By /s/ Debra Diapalla
                                         ------------------------
                                         Senior Vice President

                                      Address 100 Federal Street
                                              Boston, Massachusetts 02110



                                    EXHIBIT 1
                                    ---------

                               FLEET NATIONAL BANK
                            A BANK OF AMERICA COMPANY

                                 REVOLVING NOTE
                                 --------------

$20,000,000.00                                             Boston, Massachusetts
                                                                    May 26, 2005

      For value received, the undersigned, iRobot Corporation, a Delaware
corporation (the "BORROWER"), hereby promises to pay on May 26, 2007 to the
order of Fleet National Bank, a Bank of America company (the "BANK"), at its
main office in Boston, Massachusetts, or at any other place designated at any
time by the holder hereof, in lawful money of the United States of America and
in immediately available funds, the principal sum of Twenty Million
($20,000,000.00) Dollars, or, if less, the aggregate unpaid principal amount of
all loans made by the Bank to the Borrower under the Loan Agreement (defined
below) together with interest on the principal amount hereunder remaining unpaid
from time to time, computed on the basis of the actual number of days elapsed
and a 360-day year, from the date hereof until this Note is fully paid at the
rate(s) from time to time in effect under the Loan and Security Agreement of
even date herewith (the "Loan Agreement") by and between the Bank and the
Borrower. The principal hereof and interest accruing thereon shall be due and
payable as provided in the Loan Agreement. This Note may be prepaid only in
accordance with the Loan Agreement.

      This Note is issued pursuant, and is subject, to the Loan Agreement, which
provides, among other things, for acceleration hereof. This Note is the "Note"
referred to in the Loan Agreement.

      Bank shall have the option of imposing, and Borrower shall pay upon
billing therefor, an interest rate which is five (5%) percent per annum above
the interest rate otherwise payable ("Default Rate") (a) during any Event of
Default, unless and until the Event of Default is waived by Bank and (b) after
the Termination Date.

      Borrower shall pay, upon billing therefor, a "Late Charge" equal to five
(5%) percent of the amount of any payment of principal, other than principal due
at the Termination Date, interest, or both, which is not paid when due. Late
charges are (a) payable in addition to, and not in limitation of, the Default
Rate, (b) intended to compensate Bank for administrative and processing costs
incident to late payments, (c) are not interest, and (d) shall not be subject to
refund or rebate or credited against any other amount due.

      This Note is secured, among other things, pursuant to the Loan Agreement,
and may now or hereafter be secured by one or more other security agreements,
mortgages, deeds of trust, assignments or other instruments or agreements.

      The Borrower hereby agrees to pay all costs of collection, including
reasonable attorneys' fees and legal expenses in the event this Note is not paid
when due, whether or not legal proceedings are commenced.



      Presentment or other demand for payment, notice of dishonor and protest
are expressly waived.

      Bank may at any time pledge or assign all or any portion of its rights
under the Loan Documents including any portion of this Note to any of the twelve
(12) Federal Reserve Banks organized under Section 4 of the Federal Reserve Act,
12 U.S.C. Section 341. No such pledge or assignment or enforcement thereof shall
release Bank from its obligations under any of the Loan Documents.

      Upon receipt of an affidavit and indemnity of an officer of Bank as to the
loss, theft, destruction or mutilation of the Note or any other security
document which is not of public record, and, in the case of such loss, theft,
destruction or mutilation, upon cancellation of such Note or other security
document, Borrower will issue, in lieu thereof, a replacement note or other
security document in the same principal amount thereof and otherwise of like
tenor.

      This Note is intended by the parties as the final, complete and exclusive
statement of the transactions evidenced by this Note. All prior or
contemporaneous promises, agreements and understandings, whether oral or
written, are deemed to be superceded by this Note and no party is relaying on
any promise, agreement or understanding not set forth in this Note. This Note
may not be amended or modified except by a written instrument describing such
amendment or modification executed by Borrower and Bank.

      All rights and obligations hereunder shall be governed by the laws of the
Commonwealth of Massachusetts and this Note shall be deemed to be under seal.

                                                     iROBOT CORPORATION

                                                     By_________________________



                                    EXHIBIT 2

                                    TERM NOTE

$2,000,000.00                                              Boston, Massachusetts
                                                                    May 26, 2005

1.    Promise To Pay.

      FOR VALUE RECEIVED, iRobot Corporation, a Delaware corporation having an
address at 63 South Avenue, Burlington, Massachusetts 01803 ("Borrower")
promises to pay to the order of FLEET NATIONAL BANK, a Bank of America company,
a national banking association, having an address at 100 Federal Street, Boston,
Massachusetts 02110 ("Lender"), the principal sum of TWO MILLION ($2,000,000.00)
DOLLARS, with interest thereon, or on the amount thereof from time to time
outstanding, to be computed, as hereinafter provided, on each advance from the
date of its disbursement until such principal sum shall be fully paid. Interest
shall be payable in installments as set forth in Section 4 below. The total
principal sum, or the amount thereof outstanding, together with any accrued but
unpaid interest, shall be due and payable in full on May 26, 2012 ("Maturity
Date"), which term is further defined in, and is subject to acceleration in
accordance with, the Loan and Security Agreement (the "Loan Agreement") between
Borrower and Lender dated as of even date as may be amended from time to time.
Any amounts repaid by the Borrower may not be reborrowed.

2.    Loan Agreement.

      This Note is issued pursuant to the terms, provisions and conditions of
the Loan Agreement and evidences the Equipment Term Loan made pursuant thereto.
Capitalized terms used herein which are not otherwise specifically defined shall
have the same meaning herein as in the Loan Agreement.

3.    Interest Rates.

      3.1. Borrower's Options. Principal amounts outstanding under this Note
      shall bear interest at the following rates, at Borrower's selection,
      subject to the conditions and limitations provided for in this Note (i)
      Prime Rate or (ii) LIBOR Based Rate.

      3.1.1. Selection To Be Made. Borrower shall select, and thereafter may
      change the selection of, the applicable interest rate, from the
      alternatives otherwise provided for in this Note, by giving Lender a
      Notice of Rate Selection (i) prior to the initial Loan Advance, (ii) prior
      to the end of each Interest Period applicable to a LIBOR Rate Loan or (iii
      ) on any Business Day on which Borrower desires to convert an outstanding
      Prime Rate Loan to a LIBOR Rate Loan, provided, however, if an Event of
      Default exists, Borrower's right to select interest rate options other
      than ones based upon the Prime Rate shall cease.

      3.1.2. Notice. A "Notice of Rate Selection" shall be a written notice,
      given by cable, tested telex, telecopier (with authorized signature), or
      by telephone if immediately confirmed by such a written notice, from an
      authorized representative of Borrower which (i) is irrevocable, (ii) is
      received by Lender not later than 10:00 o'clock A.M. Boston time (a) if a
      LIBOR Based Rate is selected, at least three (3) Business Days prior to
      the first day of the Interest Period to which such selection is to apply,
      or (b) if a Prime Rate Loan is selected, on



      option, sets forth the aggregate principal amount(s) to which such
      interest rate option(s) shall apply and the Interest Period(s) applicable
      to each LIBOR Rate Loan.

      3.1.3. If No Notice. If Borrower fails to select an interest rate option
      in accordance with the foregoing prior to the closing date hereof, or
      prior to the last day of the applicable Interest Period of an outstanding
      LIBOR Rate Loan, or if a LIBOR Rate Loan is not available, any loan made
      shall be deemed to be a Prime Rate Loan, and on the last day of the
      applicable Interest Period all outstanding principal amounts shall be
      deemed converted to a Prime Rate Loan.

      3.3. Telephonic Notice. Without any way limiting Borrower's obligation to
      confirm in writing any telephonic notice, Lender may act without liability
      upon the basis of telephonic notice reasonably believed by Lender to be
      from Borrower prior to receipt of written confirmation. In each case
      Borrower hereby waives the right to dispute Lender's record of the terms
      of such telephonic Notice of Rate Selection in the absence of manifest
      error.

      3.4. Limits On Options, One Selection Per Month. Each LIBOR Rate Loan
      shall be in a minimum amount of $250,000.00. At no time shall there be
      outstanding a total of more than five (5) LIBOR Rate Loans combined at any
      time. If Borrower shall make more than one (1) interest rate selection in
      any thirty (30) day period, excluding conversions of outstanding advances
      made at the end of an applicable Interest Period of any previously
      outstanding LIBOR Rate Loan, Lender may impose and Borrower shall pay a
      reasonable processing fee for each such additional selection.

4.    Payment of Interest and Principal.

      4.1. Payment and Calculation of Interest. All interest on Prime Rate Loans
      shall be (a) payable in arrears on the first day of each month commencing
      on June 1, 2005 and on the same day of each month thereafter until the
      principal together with all interest and other charges payable with
      respect to the Loan shall be fully paid, and (b) calculated on the basis
      of a 360 day year and the actual number of days elapsed. Each change in
      the Prime Rate shall simultaneously change the Prime Rate payable under
      this Note. Interest at the LIBOR Based Rate shall be computed from and
      including the first day of the applicable Interest Period to, but
      excluding, the last day thereof and shall be payable in arrears for any
      LIBOR Based Rate having an Interest Period of three months or less, the
      last Business Day of such Interest Period, and as to any LIBOR Based Rate
      having an Interest Period longer than three months, each Business Day
      which is three months, or a whole multiple thereof, after the first day of
      such Interest Period and the last day of such Interest Period.

      4.2. Principal. Principal shall be payable on the first day of each month
      commencing on June 1, 2007 and on the same day of each month thereafter in
      59 monthly consecutive principal installments of each equal to the
      Principal Repayment Amount with the entire outstanding principal balance
      and all other interest, expenses and charges due and payable in full upon
      Maturity.

      4.3. Prepayment. The Loan or any portion thereof may be prepaid in full or
      in part at any time upon one (1) day's prior written notice to the holder
      of this Note without premium or penalty with respect to Prime Rate Loans
      and, with respect to LIBOR Rate Loans subject to applicable provisions of
      Sections 4.10 and 4.11 hereof. Any partial prepayment of principal shall
      first be applied to any installment of principal then due and then be
      applied to the



      principal due in the reverse order of maturity, and no such partial
      prepayment shall relieve Borrower of the obligation to pay each subsequent
      installment of principal when due.

      4.4 Maturity. At Maturity all accrued interest, principal and other
      charges due with respect to the Loan shall be due and payable in full and
      the principal balance and such other charges, but not unpaid interest,
      shall continue to bear interest at the Default Rate until so paid.

      4.5 Method of Payment, Date of Credit. All payments of interest, principal
      and fees shall be made in immediately available funds, without
      counterclaim or set off and free and clear of, and without any deduction
      or withholding for, any taxes or other payments (a) by direct charge to an
      account of Borrower maintained with Lender (or the then holder of the
      Loan), or (b) by wire transfer to Lender or (c) by check payable to Lender
      and delivered to Lender at 100 Federal Street, Boston, Massachusetts, or
      (d) to such other bank or address as the holder of the Loan may designate
      in a written notice to Borrower. Payments shall be credited on the
      Business Day on which immediately available funds are received prior to
      one o'clock P.M. Eastern Time, payments received after one o'clock P.M.
      Eastern Time shall be credited to the Loan on the next Business Day.
      Payments which are by check, which Lender may at its option accept or
      reject, or which are not in the form of immediately available funds shall
      not be credited to the Loan until such funds become immediately available
      to Lender, and, with respect to payments by check, such credit shall be
      provisional until the item is finally paid by the payor bank.

      4.6 Billings. Lender may submit billings reflecting payments due, however,
      any changes in the interest rate which occur between the date of billing
      and the due date may be reflected in the billing for a subsequent month.
      Neither the failure of Lender to submit a billing nor any error in any
      such billing shall excuse Borrower from the obligation to make full
      payment of all Borrower's payment obligations when due but Borrower shall
      not be in default if Borrower pays in full the amount billed in good
      faith.

      4.7 Application of Payments. All payments shall be applied first to the
      payment of all fees, expenses and other amounts due to the Lender (other
      than principal and interest), then to accrued interest, and thereafter to
      outstanding principal, provided, however, after the occurrence of any
      Default which is continuing or any Event of Default, payments will be
      applied to the Obligations of Borrower in such order and manner as Lender
      determines in its sole discretion.

      4.8 Default Rate. Lender shall have the option of imposing, and Borrower
      shall pay upon billing therefor, an interest rate which is five percent
      (5%) per annum above the interest rate otherwise payable ("Default Rate")
      (a) following any Event of Default, unless and until the Event of Default
      is waived by Lender, and (b) after Maturity.

      4.9 Late Charges. Borrower shall pay, upon billing therefor, a "Late
      Charge" equal to five percent (5%) of the amount of any payment of
      principal, other than principal due at Maturity, interest, or both, which
      is not paid when the due date thereof. Late charges are (a) payable in
      addition to, and not in limitation of, the Default Rate, (b) intended to
      compensate Lender for administrative and processing costs incident to late
      payments, (c) are not interest, and (d) shall not be subject to refund or
      rebate or credited against any other amount due.



      4.10 Calculation of Yield Maintenance.

            (i) Borrower may prepay a LIBOR Rate Loan only upon at least three
      (3) Business Days prior written notice to Lender (which notice shall be
      irrevocable), and any such prepayment shall occur only on the last day of
      the Interest Period for such LIBOR Rate Loan. Borrower shall pay to
      Lender, upon request of Lender, such amount or amounts as shall be
      sufficient (in the reasonable opinion of Lender) to compensate it for any
      loss, cost or expense incurred as a result of (i) any payment of a LIBOR
      Rate Loan on a date other than the last day of the Interest Period for
      such Loan, (ii) any failure by Borrower to borrow a LIBOR Rate Loan on the
      date specified by Borrower's written notice, (iii) any failure by Borrower
      to pay a LIBOR Rate Loan on the date for payment specified in Borrower's
      written notice Without limiting the foregoing, Borrower shall pay to
      Lender a "yield maintenance fee" in an amount computed as follows. The
      current rate for United States Treasury securities (bills on a discounted
      basis shall be converted to a bond equivalent) with a maturity date
      closest to the term chosen pursuant to the LIBOR Rate Election as to which
      the prepayment is made, shall be subtracted from the LIBOR Based Rate in
      effect at the time of prepayment. If the result is zero or a negative
      number, there shall be no yield maintenance fee. If the result is a
      positive number, then the resulting percentage shall be multiplied by the
      amount of the principal balance being prepaid. The resulting amount shall
      be divided by 360 and multiplied by the number of days remaining in the
      term chosen pursuant to the LIBOR Rate Election as to which the prepayment
      is made. Said amount shall be reduced to present value calculated by using
      the above referenced term chosen pursuant to the LIBOR Rate Election as to
      which prepayment is made. The resulting amount shall be the yield
      maintenance fee due to Lender upon the prepayment of a LIBOR Rate Loan.
      Each reference in this paragraph to "LIBOR Rate Election" shall mean the
      election by Borrower of the LIBOR Based Rate. If by reason of an Event of
      Default, Lender elects to declare the note to be immediately due and
      payable, then any yield maintenance fee with respect to a LIBOR Rate Loan
      shall become due and payable in the same manner as though Borrower had
      exercised such right of prepayment.

            (ii) The foregoing yield maintenance fees shall be payable in
      respect of all prepayments of principal whether voluntary or involuntary
      including, without limitation, prepayments made upon acceleration of the
      Loan, or application of insurance or eminent domain proceeds.

            (iii) Once written notice of intention to prepay is given, the Loan,
      or the applicable portion thereof, shall become due and payable in full on
      the date specified in the notice of prepayment and the failure to so
      prepay the loan on such date, together with any applicable yield
      maintenance fees, shall constitute an Event of Default.

            (iv) If during an Event of Default Lender elects to declare the Loan
      to be immediately due and payable, then any yield maintenance fee with
      respect to the Loan shall become due and payable in the same manner as
      though Borrower had exercised such right of prepayment.

      4.11 Make Whole Provision. Without duplication of any yield maintenance
      fee payable under Section 4.10, Borrower shall pay to Lender, immediately
      upon request and notwithstanding contrary provisions contained in any of
      the Loan Documents, such amounts as shall, in the conclusive judgment of
      Lender (in the absence of manifest error), compensate Lender for the loss,
      cost or expense which it may reasonably incur as a result of



      (i) any payment or prepayment, under any circumstances whatsoever, whether
      voluntary or involuntary, of all or any portion of a LIBOR Rate Loan on a
      date other than the last day of the applicable Interest Period of a LIBOR
      Rate Loan, or (ii) the conversion, for any reason whatsoever, whether
      voluntary or involuntary, of any LIBOR Rate Loan to a Prime Rate Loan on a
      date other than the last day of the applicable Interest Period. Such
      amounts payable by Borrower shall be equal to any administrative costs
      actually incurred plus any amounts required to compensate for any loss,
      cost or expense incurred by reason of the liquidation or re-employment of
      deposits or other funds acquired by Lender to fund or maintain a LIBOR
      Rate Loan.

5.    Certain Definitions and Provisions Relating To Interest Rate.

      5.1 Banking Day. The term "Banking Day" means any day other than a
      Saturday, Sunday, legal holiday, or day on which banks are not required or
      authorized by law to close in the city in which Lender's principal office
      is situated.

      5.2 Event of Default. As defined in the Loan Agreement.

      5.3 LIBOR Rate Loan. The term "LIBOR Rate Loan" means any principal
      outstanding under this Note which pursuant to this Note bears interest at
      the LIBOR Based Rate.

      5.4 LIBOR Based Rate. The term "LIBOR Based Rate" means the per annum rate
      of interest equal to the applicable LIBOR Rate, plus 125 basis points.

      5.5 Loan Advances or Loan. The term "Loan Advances" or "Loan" shall mean
      the advance of proceeds under this Note.

      5.6 Loan Agreement. The "Loan Agreement" means the Loan and Security
      Agreement of even date executed by the Borrower and the Lender, as may be
      amended.

      5.7 Loan Documents. The documents, instruments, and agreements inclusive
      of this Note executed by the Borrower in connection with this Note.

      5.8 Maturity. The term "Maturity" means the Maturity Date, or in any
      instance, upon acceleration of the Loan, if the Loan has been accelerated
      by Lender upon an Event of Default.

      5.9 Obligations. As defined in the Loan Agreement.

      5.10 Prime Rate. The term "Prime Rate" means the per annum rate of
      interest so designated from time to time by the Lender as its prime rate
      minus 100 basis points, with changes therein to be effective
      simultaneously with any change in the Prime Rate without notice or demand
      of any kind. The Prime Rate is a reference rate and does not necessarily
      represent the lowest or best rate being charged to any customer.

      5.11 Principal Repayment Amount. The term "Principal Repayment Amount"
      means an amount equal to the outstanding principal amount of the Equipment
      Term Loan at the termination of the Draw Period divided by sixty (60),
      payable on each Interest Payment Date commencing on the first Interest
      Payment Date following the termination of the Draw Period and continuing
      during the term of the Equipment Term Loan.



      5.12 Treasury Rate. The term "Treasury Rate" means, as of the date of any
      calculation or determination, the latest published rate for United States
      Treasury Notes or Bills (but the rate on Bills issued on a discounted
      basis shall be converted to a bond equivalent) as published weekly in the
      Federal Reserve Statistical Release H 15(519) of Selected Interest Rates
      in an amount which approximates (as determined by Lender) the amount (i)
      approximately comparable to the portion of the Loan to which the Treasury
      Rate applies for the Interest Period, or (ii) in the case of a prepayment,
      the amount prepaid and with a maturity closest to the original maturity of
      the installment which is prepaid in whole or in part.

6.    Additional Provisions Related to Interest Rate Selection.

      6.1 Increased Costs. If, due to any one or more of (i) the introduction of
      any applicable law or regulation or any change (other than any change by
      way of imposition or increase of reserve requirements already referred to
      in the definition of LIBOR Rate above in the interpretation or application
      by any authority charged with the interpretation or application thereof of
      any law or regulation, or (ii) the compliance with any guideline or
      request from any governmental central bank or other governmental authority
      (whether or not having the force of law), there shall be an increase in
      the cost to Lender of agreeing to make or making, funding or maintaining
      LIBOR Rate Loans, including without limitation changes which affect or
      would affect the amount of capital or reserves required or expected to be
      maintained by Lender, with respect to all or any portion of the Loan, or
      any corporation controlling Lender, on account thereof, then the Lender
      shall notify the Borrower thereof within a reasonable time after the
      occurrence thereof and Borrower from time to time shall, upon written
      demand by Lender, pay Lender additional amounts sufficient to indemnify
      Lender against the increased cost. A certificate as to the amount of the
      increased cost and the reason therefor submitted to Borrower by Lender, in
      the absence of manifest error, shall be conclusive and binding for all
      purposes.

      6.2 Illegality. Notwithstanding any other provision of this Note, if the
      introduction of or change in or in the interpretation of any law, treaty,
      statute, regulation or interpretation thereof shall make it unlawful, or
      any central bank or government authority shall assert by directive,
      guideline or otherwise, that it is unlawful, for Lender to make or
      maintain LIBOR Rate Loans or to continue to fund or maintain LIBOR Rate
      Loans then, on written notice thereof and demand by Lender to Borrower,
      (a) the obligation of Lender to make LIBOR Rate Loans and to convert or
      continue any Loan Advances as LIBOR Rate Loans shall terminate and (b)
      Borrower shall convert all principal outstanding under this Note into
      Prime Rate Loans.

      6.3 Additional LIBOR Conditions. The selection by Borrower of a LIBOR
      Based Rate and the maintenance of Loan Advances at such rate shall be
      subject to the following additional terms and conditions:

            (i) Availability. If, before or after Borrower has selected to take
      or maintain a LIBOR Rate Loan Lender notifies Borrower that

                  (a) dollar deposits in the amount and for the maturity
      requested are not available to Lender in the London interbank market at
      the rate specified in the definition of LIBOR Rate set forth above, or



                  (b) reasonable means do not exist for Lender to determine the
      LIBOR Rate for the amounts and maturity requested, then the principal
      which would have been a LIBOR Rate Loan shall be a Prime Rate Loan.

            (ii) Payments Net of Taxes. All payments and prepayments of
      principal and interest under this Note shall be made net of any taxes and
      costs resulting from having principal outstanding at or computed with
      reference to a LIBOR Based Rate. Without limiting the generality of the
      preceding obligation, illustrations of such taxes and costs are taxes, or
      the withholding of amounts for taxes, of any nature whatsoever including
      income, excise, interest equalization taxes (other than United States or
      state income taxes) as well as all levies, imposts, duties or fees whether
      now in existence or as the result of a change in or promulgation of any
      treaty, statute, regulation, or interpretation thereof or any directive
      guideline or otherwise by a central bank or fiscal authority (whether or
      not having the force of law) or a change in the basis of, or the time of
      payment of, such taxes and other amounts resulting therefrom.

      6.4. Prime Rate Loans. Each Prime Rate Loan shall continue as a Prime Rate
      Loan until Maturity of the Loan, unless sooner converted, in whole or in
      part, to a LIBOR Rate Loan, subject to the limitations and conditions set
      forth in this Note.

      6.5. Conversion of Other Advances. At the end of each applicable Interest
      Period, the applicable LIBOR Rate Loan shall be converted to a Prime Rate
      Loan unless Borrower selects another option in accordance with the
      provisions of this Note.

7.    Acceleration, Event of Default.

      Upon the occurrence and during the continuance of any one or more of the
Events of Default, any and all liabilities of the Borrower to the Lender shall
become immediately due and payable, at the option of the Lender and without
notice or demand. The occurrence of any Event of Default shall also constitute,
without notice or demand, a default under all other agreements between the
Lender, and the Borrower and instruments and papers given the Lender by the
Borrower, whether such agreements, instruments, or papers now exist or hereafter
arise.

8.    Certain Waivers, Consents and Agreements.

      Each and every party liable hereon or for the indebtedness evidenced
hereby whether as maker, endorser, guarantor, surety or otherwise hereby (a)
waives presentment, demand, protest, suretyship defenses and defenses in the
nature thereof, (b) waives any defenses based upon and specifically assents to
any and all extensions and postponements of the time for payment, changes in
terms and conditions and all other indulgences and forbearances which may be
granted by the holder to any party now or hereafter liable hereunder or for the
indebtedness evidenced hereby, (c) agrees to any substitution, exchange,
release, surrender or other delivery of any security or collateral now or
hereafter held hereunder or any of the other Loan Documents, and to the addition
or release of any other party or person primarily or secondarily liable, (d)
agrees that if any security or collateral given to secure this Note or the
indebtedness evidenced hereby or to secure any of the obligations set forth or
referred to in any of the Loan Documents, shall be found to be unenforceable in
full or to any extent, or if Lender or any other party shall fail to duly
perfect or protect such collateral, the same shall not relieve or release any
party liable hereon or thereon nor vitiate any other security or collateral
given for any obligations evidenced hereby or thereby, (e) agrees to pay all
costs and expenses reasonably incurred by Lender or any


other holder of this Note in connection with the indebtedness evidenced hereby,
including, without limitation, all attorneys' fees and costs, for the
implementation of the Loan, the collection of the indebtedness evidenced hereby
and the enforcement of rights and remedies hereunder or under the other Loan
Documents, whether or not suit is instituted, and (f) consents to all of the
terms and conditions contained in this Note, and all other instruments now or
hereafter executed evidencing or governing all or any portion of the security or
collateral for this Note or any one or more of the Loan Documents.

9.     Delay Not A Bar.

      No delay or omission on the part of the holder in exercising any right
hereunder or any right under any instrument or agreement now or hereafter
executed in connection herewith, or any agreement or instrument which is given
or may be given to secure the indebtedness evidenced hereby or any other
agreement now or hereafter executed in connection herewith or therewith shall
operate as a waiver of any such right or of any other right of such holder, nor
shall any delay, omission or waiver on any one occasion be deemed to be a bar to
or waiver of the same or of any other right on any future occasion.

10.    Partial Invalidity.

      The invalidity or unenforceability of any provision hereof, of the Loan
Documents, or of any other instrument, agreement or document now or hereafter
executed in connection with the Loan made pursuant hereto and thereto shall not
impair or vitiate any other provision of any of such instruments, agreements and
documents, all of which provisions shall be enforceable to the fullest extent
now or hereafter permitted by law.

11.    Compliance With Usury Laws.

      All agreements between Borrower, each Guarantor and Lender are hereby
expressly limited so that in no contingency or event whatsoever, whether by
reason of acceleration of maturity of the indebtedness evidenced hereby or
otherwise, shall the amount paid or agreed to be paid to Lender for the use or
the forbearance of the indebtedness evidenced hereby exceed the maximum
permissible under applicable law. As used herein, the term "applicable law"
shall mean the law in effect as of the date hereof, provided, however, that in
the event there is a change in the law which results in a higher permissible
rate of interest, then this Note shall be governed by such new law as of its
effective date. In this regard, it is expressly agreed that it is the intent of
Borrower and Lender in the execution, delivery and acceptance of this Note to
contract in strict compliance with the laws of the Commonwealth of Massachusetts
from time to time in effect. If, under or from any circumstances whatsoever,
fulfillment of any provision hereof or of any of the Loan Documents at the time
performance of such provision shall be due, shall involve transcending the limit
of validity prescribed by applicable law, then the obligation to be fulfilled
shall automatically be reduced to the limit of such validity, and if under or
from any circumstances whatsoever Lender should ever receive as interest an
amount which would exceed the highest lawful rate, such amount which would be
excessive interest shall be applied to the reduction of the principal balance
evidenced hereby and not to the payment of interest. This provision shall
control every other provision of all agreements between Borrower, the Guarantor
and Lender.

12.    Security.



      This Note is secured as provided in the Loan Agreement.

13.   Notices.

      Any notices given with respect to this Note shall be given in the manner
provided for in the Loan Agreement.

14.   Governing Law and Consent to Jurisdiction.

      14.1 Substantial Relationship. It is understood and agreed that all of the
      Loan Documents were negotiated, executed and delivered in the Commonwealth
      of Massachusetts, which Commonwealth the parties agree has a substantial
      relationship to the parties and to the underlying transactions embodied by
      the Loan Documents.

      14.2 Place of Delivery. Borrower agrees to furnish to Lender at Lender's
      office in Boston, Massachusetts all further instruments, certifications
      and documents to be furnished hereunder.

      14.3 Governing Law. This Note and each of the other Loan Documents shall
      in all respects be governed, construed, applied and enforced in accordance
      with the internal laws of the Commonwealth of Massachusetts without regard
      to principles of conflicts of law.

      14.4 Consent to Jurisdiction. Borrower hereby consents to personal
      jurisdiction in any state or Federal court located within the Commonwealth
      of Massachusetts. BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF
      THIS NOTE OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS
      OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN
      AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF
      PROCESS IN ANY SUCH SUIT BEING MADE UPON BORROWER BY MAIL AT THE ADDRESS
      SET FORTH IN THE LOAN AGREEMENT. BORROWER HEREBY WAIVES ANY OBJECTION THAT
      IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH
      COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT FORUM.

15.   Waiver of Jury Trial.

            BORROWER AND LENDER (BY ACCEPTANCE OF THIS NOTE) MUTUALLY HEREBY
      KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY
      JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN
      CONNECTION WITH THIS NOTE OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE
      EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF
      DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY,
      INCLUDING, WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
      STATEMENTS OR ACTIONS OF LENDER RELATING TO THE ADMINISTRATION OF THE LOAN
      OR ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE THAT NEITHER PARTY WILL
      SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY
      TRIAL CANNOT BE OR HAS NOT BEEN WAIVED EXCEPT AS



      PROHIBITED BY LAW, BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM
      OR RECOVER IN ANY LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR
      CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
      DAMAGES. BORROWER CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF
      LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT LENDER WOULD NOT, IN
      THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER. THIS WAIVER
      CONSTITUTES A MATERIAL INDUCEMENT FOR LENDER TO ACCEPT THIS NOTE AND MAKE
      THE LOAN.

16.   No Oral Change.

      This Note and the other Loan Documents may only be amended, terminated,
extended or otherwise modified by a writing signed by the party against which
enforcement is sought. In no event shall any oral agreements, promises, actions,
inactions, knowledge, course of conduct, course of dealing, or the like be
effective to amend, terminate, extend or otherwise modify this Note or any of
the other Loan Documents.

17.   Rights of the Holder.

      This Note and the rights and remedies provided for herein may be enforced
by Lender or any subsequent holder hereof. Wherever the context permits each
reference to the term "holder" herein shall mean and refer to Lender or the then
subsequent holder of this Note.

18.   Right to Pledge to Federal Reserve. Lender may at any time pledge or
assign all or any portion of its rights under the Loan Documents including any
portion of this Note to any of the twelve (12) Federal Reserve Banks organized
under Section 4 of the Federal Reserve Act, 12 U.S.C Section 341. No such pledge
or assignment or enforcement thereof shall release Lender from its obligations
under any of the Loan Documents.

19.   General Rights of Assignment and Participation. Lender shall have the
unrestricted right at any time or from time to time, and without Borrower's or
any Guarantor's consent, to assign all or any portion of its rights and
obligations hereunder to one or more banks or other financial institutions
(each, as "Assignee"), and Borrower and each Guarantor agrees that it shall
execute, or cause to be executed, such documents, including without limitation,
amendments to this Agreement and to any other documents, instruments and
agreements executed in connection herewith as Lender shall deem necessary to
effect the foregoing. In addition, at the request of Lender and any such
Assignee, Borrower shall issue one or more new promissory notes, as applicable,
to any such Assignee and, if Lender has retained any of its rights and
obligations hereunder following such assignment, to Lender, which new promissory
notes shall be issued in replacement of, but not in discharge of, the liability
evidenced by the promissory note held by Lender prior to such assignment and
shall reflect the amount of the respective commitments and loans held by such
Assignee and Lender after giving effect to such assignment. Upon the execution
and delivery of appropriate assignment documentation, amendments and any other
documentation required by Lender in connection with such assignment and the
payment by Assignee of the purchase price agreed to by Lender, and such
Assignee, such Assignee shall be a party to this Agreement and shall have all of
the rights and obligations of Lender hereunder (and under any and all other
guaranties, documents, instruments and agreements executed in connection
herewith) to the extent that such rights and obligations have been assigned by
Lender pursuant to the assignment documentation between Lender and such
Assignee, and Lender shall



be released from its obligations hereunder and thereunder to a corresponding
extent. Lender may furnish any information concerning Borrower, Guarantor or the
collateral in its possession from time to time to prospective Assignees,
provided that Lender require any such prospective Assignees to agree in writing
to maintain the confidentiality of such information.

      Lender shall have the unrestricted right at any time and from time to
time, and without the consent of or notice to Borrower or any Guarantor, to
grant to one or more banks or other financial institutions (each, a
"Participant") participating interests in Lender's obligation to lend hereunder
and/or any or all of the loans held by Lender hereunder. In the event of any
such grant by Lender of a participating interest to a Participant, whether or
not upon notice to Borrower, Lender shall remain responsible for the performance
of its obligations hereunder and Borrower shall continue to deal solely and
directly with Lender in connection with Lender's rights and obligations
hereunder. Lender may furnish any information concerning Borrower in its
possession from time to time to prospective Participants, provided that Lender
shall require any such prospective Participant to agree in writing to maintain
the confidentiality of such information.

20.   Replacement Note. Upon receipt of an affidavit and indemnity of an officer
of Lender as to the loss, theft, destruction or mutilation of the Note or any
other security document which is not of public record, and, in the case of any
such loss, theft, destruction or mutilation, upon cancellation of such Note or
other security document, Borrower will issue, in lieu thereof, a replacement
note or other security document in the same principal amount thereof and
otherwise of like tenor.

21.   Integration. This Note is intended by the parties as the final, complete
and exclusive statement of the transactions evidenced by this Note. All prior or
contemporaneous promises, agreements and understandings, whether oral or
written, are deemed to be superceded by this Note and no party is relaying on
any promise, agreement or understanding not set forth in this Note. This Note
may not be amended or modified except by a written instrument describing such
amendment or modification executed by Borrower and Lender.

22.   Use of Proceeds. No portion of the proceeds of the Loan shall be used, in
whole or in part, for the purpose of purchasing or carrying any "margin stock"
as such term is defined in Regulation U of the Board of Governors of the Federal
Reserve System.

23.   Setoff. Borrower hereby grants to Lender, a continuing lien, security
interest and right of setoff as security for all liabilities and obligations to
Lender, whether now existing of hereafter arising, upon and against all
deposits, credits, collateral and property, now or hereafter in the possession,
custody, safekeeping or control of Lender or any entity under the control of
Bank of America Corporation and its successors and assigns, or in transit to any
of them. At any time during an Event of Default without demand or notice (any
such requirement for notice being knowingly voluntarily and irrevocably waived
by Borrower), Lender may set off the same or any part thereof and apply the same
to any liability or obligation of Borrower even though unmatured and regardless
of the adequacy of any other collateral securing the Loan. ANY AND ALL RIGHTS TO
REQUIRE LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER
COLLATERAL WHICH SECURES THE LOAN, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH
RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE BORROWER, ARE HEREBY
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.



      IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed as
of the date set forth above as a sealed instrument at Boston, Massachusetts.

Witness                                         BORROWER
                                                iROBOT CORPORATION

_____________________________                   By_____________________________
                                                Name___________________________
                                                Title__________________________



                                   EXHIBIT 3

                           Equipment Loan Certificate

                           EQUIPMENT LOAN CERTIFICATE

                                                   Date_______________

Fleet National Bank, a Bank of America company
100 Federal Street
Boston, Massachusetts 02110

      Re: Equipment Loan Borrowing

Pursuant to Section 6(b) of the Loan and Security Agreement (the "Loan
Agreement") dated May 26, 2005, as amended by and between iRobot Corporation
(the "Borrower") and Fleet National Bank, a Bank of America company, (the
"Bank") the undersigned Borrower hereby certifies as follows:

      1.    The Borrower hereby requests a loan in the amount of $_____________.

      2.    The Borrower hereby requests the loan to be made on____________which
            is a Business Day.

      3.    The Borrower shall be using the proceeds of the aforesaid loan for
            the following purposes.

      4.    The Borrower hereby attaches all appropriate invoices and other
            documentation relative the requested advance.

      5.    No Event of Default has occurred and is continuing.

      All capitalized terms not otherwise defined herein shall have the meaning
as assigned to such terms in the Loan Agreement.



      The undersigned Borrower certifies that the information provided herein is
true and accurate.

                                           iRobot Corporation

                                           By__________________________________

                                           Name________________________________

                                           Title_______________________________



                                    Exhibit 4

                              NOTICE OF BORROWING

                                                 Date __________________ , 200_

To Fleet National Bank, a Bank of America company
   100 Federal Street
   Boston, Massachusetts 02110

   Re    Loan and Security Agreement dated May 26, 2005 (the "Loan Agreement")
         between Fleet National Bank, a Bank of America Company (the "Bank") and
         iRobot Corporation (the "Borrower").

   This Notice of Borrowing confirms the following request for a LIBOR Rate Loan
- -conversion of a Prime Rate Loan (check applicable box) under the Loan
Agreement.

   Date of Request

   Date of LIBOR Rate Loan

   Amount of LIBOR Rate Loan at LIBOR Rate *

   Interest Period

            1, 2, 3 or 6 months

            This is a request for a continuation/conversion of a LIBOR loan
            described as follows:

            Date of Original Loan

            Amount of Original Loan

            Maturity Date

            Interest Period

            Amount of Loan to be Continued or Converted

   The Borrower hereby certifies that all representations and warranties
contained in the Loan Agreement are true and accurate in all material respects
on the date of this Notice of Borrowing as though such representations and
warranties had been made on this date (except to the extent that such
representation or warranty expressly relates to an earlier date).

   Terms used herein which are defined in the Loan Agreement are used as so
defined

                                         iROBOT CORPORATION

                                         By_________________________________

   *  Minimum of $250,000.00 with increments of $100,000.00______________



                                    Exhibit 5

                             COMPLIANCE CERTIFICATE

      iRobot Corporation ("Borrower") hereby certifies to Fleet National Bank, a
Bank of America company ("Bank"), pursuant to the Loan and Security Agreement
between Borrower and Bank dated May 26, 2005 as may be amended from time to time
("Loan Agreement"), that:

A.    General.

      1. Capitalized terms not defined herein shall have the meanings set forth
in the Loan Agreement.

      2. The Borrower has complied with all the terms, covenants and conditions
to be performed or observed by the Borrower contained in the Loan Agreement and
other documents required to be executed by the Borrower in connection with the
Loan Agreement.

      3. Neither on the date hereof nor, if applicable, after giving effect to
the loan made on the date hereof, does there exist an Event of Default or an
event which would with notice or the lapse of time, or both, constitute an Event
of Default.

      4. The representations and warranties contained in the Loan Agreement and
in any certificate, document or financial or other statement furnished at any
time thereunder are true, correct and complete in all material respects with the
same effect as though such representations and warranties had been made on the
date hereof, except to the extent that any such representation and warranty
relates solely to an earlier date (in which case such representation and
warranty shall be true, correct and complete on and as of such earlier date).

B.    Financial Covenants.

      As of the date hereof or, for such period as may be designated below, the
computations, ratios and calculations as set forth below in accordance with
Section 17 of the Loan Agreement are true and correct.

            1.    TANGIBLE CAPITAL BASE - SECTION 17(a)

            The tangible capital base of the Borrower as of
      ________________________, 200_____, was $____________________ and was
      computed as follows:

      A.    Tangible Net Worth

            i.    Stockholders' equity                              $__________

            ii.   Intangible assets                                 $__________

            iii.  Accounts due from affiliates                      $__________

            iv.   Tangible net worth (i - ii - iii) =               $__________

      B.    Subordinated indebtedness                               $__________

      C.    Tangible capital base (A + B) =                         $__________

            Required  At least $_______________________

                                     - 5 -



      IN WITNESS WHEREOF, the undersigned, a duly authorized officer of
Borrower, has executed and delivered this Certificate in the name and on behalf
of the Borrower on ______________, 200__.

                                             iROBOT CORPORATION

                                             By_________________________________

                                     - 6 -

                                                                   EXHIBIT 10.16

                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
            INTERNATIONAL CORPORATION
            AN EMPLOYEE-OWNED COMPANY              PAGE 1 OF 48, REV. A (SA-002)
                                                                (APRIL 30, 2004)

                             Purchase/Contract Type:  Cost Plus Fixed Fee (CPFF)

                             Security Classification: unclassified
                             Prime Contract Number:   DAAE07-03-9-F001
                             Vendor Number:           607303
                             Account Number:          N/A
                             DPAS Priority Rating:    DO
                             Cost Charge No.:         See Section B.2
                             Terms Of Payment:        Net 30 Days

IROBOT CORPORATION ("IROBOT")
63 SOUTH AVENUE
BURLINGTON, MA 01803-4903

This Cost Plus Fixed Fee (CPFF) contract is hereby placed with iRobot
Corporation (hereinafter referred to as "iRobot," "Seller," "Subcontractor,"
"Supplier," or "Teammate") by SCIENCE APPLICATIONS INTERNATIONAL CORPORATION,
(herein referred to as "SAIC", "Buyer," or "LSI,") a Delaware Corporation with
principle offices in San Diego, California, for the goods and services described
herein, and is subject to the terms and conditions set forth hereunder.

This contract constitutes the entire understanding and agreement between the
parties with respect to the subject matter hereof and supersedes all prior
representations and agreements.

IN WITNESS WHEREOF, the parties hereto have executed this contract effective as
of the date executed by SAIC below:

IROBOT CORPORATION                        SCIENCE APPLICATIONS
                                          INTERNATIONAL CORPORATION

By: Original Signed On file               By: Original Signed On File
    -----------------------                   ---------------------------

Typed/Printed Name: Robert L. Moses       Typed Name: J. R, (Rick) Yoast

Title: Director, Acquisition and          Title: Senior Subcontracts
       Business Development                      Administrator

Date: 06 November 2003                    Date: 07 November 2003

                          END OF COVER/SIGNATURE PAGE



                                                                    Page 2 of 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company PURCHASE CONTRACT NUMBER: 4400078647

                                TABLE OF CONTENTS

SECTION A  SPECIAL AGREEMENTS AND OTHER IMPORTANT PROVISIONS AND NOTIFICATIONS

           A.1   DEFINITIONS

           A.2   ORDER OF PRECEDENCE

           A.3   CONTRACT CHANGES AND CONFORMING CONTRACT

           A.4   CONTRACT CHANGE SUMMARY LIST

           A.5   EXPORT LAWS AND REGULATIONS

           A.6   WARNING - U.S. EXPORT CONTROLS LAWS

           A.7   SELLER PERFORMING WORK AT LSI, GOVERNMENT, OR OTHER FCS
                 CONTRACTOR'S FACILITY

           A.8   NON-FOREIGN CERTIFICATION AND REPRESENTATION

           A.9   PRE-CONTRACT COSTS

SECTION B  GOODS/SERVICES AND PRICES/COSTS

           B.1   CONTRACT TYPE

           B.2   STATEMENT OF REQUIREMENTS AND TOTAL CONTRACT VALUE

           B.3   CONTRACT LINE ITEM NUMBER (CLIN) BREAKDOWN SUMMARY

           B.4   RESERVED

           B.5   COST UNDERRUN INCENTIVE FEE TABLE

SECTION C  STATEMENT OF WORK/SPECIFICATIONS

           C.1   STATEMENT OF WORK (SOW)

           C.2   SUBCONTRACT DATA REQUIREMENTS LIST (SDRL)

           C.3   CONTRACT SECURITY CLASSIFICATION SPECIFICATION

           C.4   OVERRIDING PRINCIPLES, CHANGES AND CLARIFICATIONS TO WORK
                 SCOPE

           C.5   TASK ORDERS - (LOE)

           C.6   TASK ORDERS - (COMPLETION)

SECTION D  PACKAGING AND MARKING

           D.1   GENERAL PACKAGING AND MARKING REQUIREMENTS

           D.2   COMMERCIAL PRACTICES

           D.3   DATA, REPORTS AND CERTIFICATIONS

SECTION E  INSPECTION AND ACCEPTANCE

           E.1   INSPECTION OF RESEARCH AND DEVELOPMENT

           E.2   INSPECTION OF SUPPLIES

           E.3   INSPECTION OF SERVICES

           E.4   INSPECTION AND ACCEPTANCE AT DESTINATION

           E.5   INSPECTION AND ACCEPTANCE AT SOURCE

           E.6   MATERIAL INSPECTION AND RECEIVING REPORT

           E.7   CERTIFICATE OF CONFORMANCE

SECTION F  DELIVERIES OR PERFORMANCE

           F.1   GENERAL SHIPPING/DELIVERY REQUIREMENTS

           F.2   DELIVERY DESTINATIONS

           F.3   PERFORMANCE



                                        PURCHASE CONTRACT NUMBER:   4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company        PAGE 3 OF 48, REV. B (SA-006)
                                                                (MARCH 31, 2005)

           F.4   PERIOD OF PERFORMANCE

           F.5   CONTRACT DELIVERABLES

           F.6   CONTRACT PERFORMANCE SCHEDULE

           F.7   PROGRAM SCHEDULE

           F.8   FCS PROGRAM MAJOR MILESTONE SCHEDULE

SECTION G  CONTRACT ADMINISTRATION DATA

           G.1   INVOICE AND PAYMENT

           G.2   PAYMENT OF FIXED FEE - ALL NON-TASK ORDER CLINs

           G.3   COST UNDERRUN INCENTIVE - ALL NON-TASK ORDER CLINs

           G.4   PAYMENT OF FIXED FEE - CPFF (LOE) TASK ORDER CLINs

           G.5   PAYMENT OF FIXED FEE - CPFF (COMPLETION) TASK ORDER CLINs

           G.6   PAYMENT TERMS

           G.7   STATE SALES - USE TAX

           G.8   SUBMISSION OF INVOICES

           G.9   INVOICE CONTENTS

           G.10  TECHNICAL AND ADMINISTRATIVE REPRESENTATIVES

SECTION H  SPECIAL PROVISIONS

           H.1   INCREMENTAL FUNDING

           H.2   BUYER FURNISHED EQUIPMENT, PROPERTY, INFORMATION, FACILITIES,
                 AND SERVICES

           H.3   GOVERNMENT FURNISHED ASSETS (GFX)

           H.4   DATA OR SOFTWARE TO BE PROVIDED WITH RESTRICTIONS

           H.5   ORDERING FROM GOVERNMENT SUPPLY SOURCES (PRIME FLOWDOWN)

           H.6   KEY PERSONNEL

           H.7   RESERVED

           H.8   CERTIFICATION OF FINAL INDIRECT COSTS

           H.9   EQUITABLE ADJUSTMENT

           H.10  MODIFICATIONS

           H.11  CONTRACT CHANGE PROPOSALS

           H.12  MAKE/BUY AND DIRECTED PROCUREMENTS

           H.13  ONE TEAM SHARED DESTINY

           H.14  FIREWALL - COMPETITION SENSITIVE INFORMATION

           H.15  FIREWALL - PROPOSAL EVALUATION - SUBCONTRACTOR IPT LEADER

           H.16  EMPLOYMENT OF FORMER BUYER EMPLOYEE

           H.17  AUTHORIZATION AND ADMINISTRATION OF CPFF LEVEL-OF-EFFORT TASK
                 ORDERS

           H.18  CPFF TASK ORDER ACCEPTANCE - CERTIFICATION OF UTILIZATION OF
                 HOURS

           H.19  AUTHORIZATION AND ADMINISTRATION OF CPFF COMPLETION TASK ORDERS

           H.20  CPFF TASK ORDER ACCEPTANCE - CERTIFICATION OF COMPLETION

           H.21  LOWER TIER SUBCONTRACTING

           H.22  ASSIGNMENT PROVISION

           H.23  SPECIAL TERMINATION LIABILITY

SECTION I GENERAL PROVISIONS

           1.1   IDS COMMON TERMS AND CONDITIONS GUIDE

           1.2   ADDITIONAL FULL-TEXT PROVISIONS

SECTION J  LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACHMENTS

                            END OF TABLE OF CONTENTS



                                                                    Page 4 of 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
            INTERNATIONAL CORPORATION
            An Employee-Owned Company       PURCHASE CONTRACT NUMBER: 4400078647

SECTION A - SPECIAL AGREEMENTS AND OTHER IMPORTANT PROVISIONS AND NOTIFICATIONS

A.1   DEFINITIONS

      a.    The term "Lead Systems Integrator" or "LSI" refers to The Boeing
            Company and Science Applications International Corporation,
            responsible to the U.S. Government under the Boeing/Government prime
            Agreement for the Systems Development and Demonstration (SDD) phase
            of the Future Combat System (FCS) Program.

      b.    Unless otherwise specified, the terms "contract," "subcontract,"
            "purchase order," or "purchase contract" are synonymous.

      c.    An "administrative change" means a unilateral contract change, in
            writing by the SAIC Procurement Agent, that does not affect the
            substantive rights of the contracting parties.

      d.    The terms "Buyer's authorized Procurement Representative" and
            "Buyer's authorized Procurement Agent" are synonymous.

      e.    Unless otherwise specified, "prime agreement," "Agreement," "Other
            Transaction Agreement," or "OTA" mean the Future Combat Systems
            (FCS) System Development and Demonstration (SDD) Phase agreement
            between the Government and The Boeing Company.

      f.    A "unilateral change" is a contract change that is signed only by
            Buyer's authorized Procurement Agent. Unilateral changes are used,
            for example, to make: (1) administrative changes; (2) Issue change
            orders or change notices authorized by the Changes clause; (3) Make
            changes authorized by clauses other than a changes clause (e.g.,
            Property clause, Options clause, Limitation of Funds clause, or
            Suspension of Work clause); and (4) Issue termination notices.

      g.    A "bilateral change" is a contract change that is signed by Seller
            and Buyer's authorized Procurement Agent. Bilateral changes are used
            to: (1) Make negotiated equitable adjustments resulting from the
            issuance of a change order or Change Notice; (2) Definitize letter
            contracts; and (3) Reflect other agreements of the parties modifying
            the terms of contracts. A Supplemental Agreement is a bilateral
            contract change.

      h.    All reference within this subcontract to GP4 "The Boeing Company
            General Provisions (Cost Reimbursement Contract Under Government
            Prime Contract)" shall be considered as SAIC General Provisions for
            the purpose of this subcontract only and in no way sets a precedence
            for any other subcontracts Seller may currently have or enter into
            in the future with The Boeing Company or SAIC.

A.2   ORDER OF PRECEDENCE

      Any inconsistency in this contract shall be resolved by giving precedence
      in the following order:

      1.    Clause 5068 (Government Contract Requirements) set forth in Section
            I and Section H clauses with "(PRIME FLOWDOWN)" in clause title

      2.    Sections A through G (excluding Section C - Statement of
            Work/Specifications)

      3.    Section H (Special Provisions)

      4.    Section I (General Provisions)

      5.    Section C (Statement of Work/Specifications)

      6.    All other documents, exhibits and attachments set forth in Section J



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
            INTERNATIONAL CORPORATION
            An Employee-Owned Company              PAGE 5 OF 48, REV. G (SA-008)
                                                                (APRIL 22, 2005)

A.3   CONTRACT CHANGES AND CONFORMING CONTRACT

      a.    Buyer's authorized Procurement Agent is the only person empowered to
            execute contract changes on behalf of Buyer. Buyer-issued contract
            changes --

            (1)   will be sequentially numbered, e.g., contract change no. 001,
                  002, 003, etc.;

            (2)   will define the type of contract change, e.g.,
                  Unilateral/Undefinitive Change Notice, Unilateral Funding
                  Order, Supplemental Agreement ;

            (3)   will provide new/revised contract attachments/exhibits, as
                  applicable; and

            (4)   will include a replacement or new contract page when there is
                  a change in the contract text or terms except for undefinitive
                  contract changes.

            Undefinitive contract changes such as a Change Notice issued under
            the Changes clause will not be reflected in the text of a
            replacement contract page until definitized by Supplemental
            Agreement.

      b.    Replacement contract pages will identify the specific text change(s)
            by revision bar (vertical line) placed in the margin of the
            replacement page. AT BUYER'S OPTION, further DELINEATION OF
            CHANGE(S) CAN BE MADE BY SHOWING strikethroughs (for deleted text)
            and italics or BOLDED PRINT (FOR ADDED TEXT). Each replacement page
            will identify at the top of the page (or header) the Contract Change
            Number and date. By issuing the replacement contract page, Seller
            will possess a complete conforming text of the contract.

      c.    When the contract change adds new text requiring additional contract
            pages, Buyer will retain the original contract page number with
            added pages designated by letter, e.g., page 5 adds pages 5a, 5b,
            5c, etc. A new contract page will be identified in the same manner
            as the replacement contract page described above, i.e., Contract
            Change Number and date.

A.4   CONTRACT CHANGE SUMMARY LIST

      The table below provides a descriptive list of the Contract Changes issued
      under the contract. Buyer will issue an updated summary table from
      time-to-time by way of an administrative contract change as the number of
      contract change documents accumulate.

      NOTE: THE BELOW TABLE IS INITIALLY BLANK, RESERVING SPACE AND FORMAT FOR
      RECORDING FUTURE CHANGE ENTRIES.



CONTRACT                 EFFECTIVE
 CHANGE      DATE OF      DATE OF
 NUMBER      DOCUMENT     CHANGE                TYPE/DESCRIPTION OF CHANGE(S)
- --------    ---------    ---------              -----------------------------
                              
 001        02/06/04      02/09/04     Supplemental Agreement 001.
                                       Revise Attachment J-13 to add Task
                                       Order 001.

 002        04/30/04      04/30/04     Supplemental Agreement 002.
                                       Incorporate revised SOW,SDRL and PCD (CP1) and Incorporate
                                       CR008.

 003        06/01/04      06/01/04     Supplemental Agreement 003.
                                       Incorporate Dollars into Special Termination Liability
                                       Clause H.23 Paragraph c.

 004        09/02/04      09/02/04     Supplemental Agreement 004.
                                       Incorporate the GFX revised wording for Section H.3 and
                                       Replaced Clause 3012 with Clause 3068, Added J-19 ADR

 005        09/07/04      09/07/04     Supplemental Agreement 005.
                                       Incorporates CP-002/CR33 for additional  integration support
                                       to the C4ISR System Integration Laboratories beginning with
                                       the initial delivery of platform simulators (UGV) simulation for IPS1.


 006        03/31/05      02/22/05     Supplemental Agreement 006
                         (Based on     Authorize directed changes in accordance with the FCS Program Transition
                         ATP Issued)   Change Proposal, CP003; extending SDD to March 2013 and spiraling
                                       and stretching some existing deliveries.

 007        04/01/05      04/01/05     Supplemental Agreement 007
                                       Directs iRobot Corporation - Burlington, MA. to accomplish Task Orders
                                       as described in the attached Task Order 099A1 (SSEI-MV04) and Task Order
                                       099A2 (SSEI-MV05) in support of SSEI-IPT and creation of CLIN 0099A.

008         04/22/05      04/22/05     SUPPLEMENTAL AGREEMENT 008
                                       RESTORES THE CONTRACT VALUE OF CLIN 0001 BACK TO THE LEVEL ESTABLISHED
                                       AT SA-006 CP003 TRANSITION. THIS INCREASES THE VALUE OF CONTRACT BY
                                       SSEI-T.O. AMOUNT. AMENDS SECTION F.2 DELIVERY ADDRESS INFORMATION.




                                                                    Page 6 of 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
            INTERNATIONAL CORPORATION
            An Employee-Owned Company      PURCHASE CONTRACT NUMBER: 4400078647

A.5   EXPORT LAWS AND REGULATIONS

      Seller agrees to comply fully with all applicable U.S. laws and
      regulations as they may apply to the export of any hardware, software,
      defense service or technical data (collectively "Data") provided by,
      through or with the cooperation of Seller in the performance of this
      subcontract in the U.S. or abroad or under any export license or exemption
      issued to Buyer. Seller agrees that it will not permit the re-export of
      Data, including to foreign nationals, employed by or associated with, or
      under contract to Seller or Seller's lower-tier suppliers, without the
      prior written consent of Buyer and under authority of an export license or
      applicable license exemption.

A.6   WARNING - U.S. EXPORT CONTROLS LAWS

      Information furnished to Seller under this purchase contract may contain
      data subject to U.S. Export Laws and Regulations. Seller is advised that
      such data may not be exported or re-exported to foreign persons, employed
      by or associated with, or under contract to Seller or Seller's lower-tier
      suppliers, without the prior written consent of Buyer and under authority
      of an export license or applicable license exemption. If such data is
      marked as Export Controlled, Seller shall indemnify and hold Buyer
      harmless from and against any and all claims, liabilities and expenses
      resulting from Seller's failure to comply with the export laws and
      regulations of the United States.

A.7   SELLER PERFORMING WORK AT LSI, GOVERNMENT, OR OTHER FCS CONTRACTOR'S
      FACILITY

      By law, Buyer must control access to export controlled technical data
      within its facilities. Therefore, Seller shall only assign personnel to
      perform work in LSI's facilities who are either U.S. citizens or who have
      been granted Permanent Resident Alien status in the U.S. Seller's
      personnel will be required to furnish documentary evidence of citizenship
      or immigration status to LSI's Security Badge and ID personnel at the time
      of badge pick-up. Acceptable documentary evidence of citizenship or
      immigration status includes U.S. Passport, Certificate of U.S.
      Citizenship, Certificate of Naturalization, certified copy of U.S. Birth
      Certificate, U.S. Alien Registration Receipt Card with Photo, un-expired
      foreign passport with INS-551 stamp of Certificate of Birth Abroad issued
      by the U.S. Department of State.

A.8   NON-FOREIGN CERTIFICATION AND REPRESENTATION

      Seller's acceptance of this contract, confirms that:

        (1)   it is not a foreign corporation, and

        (2)   it is not a Representative of a Foreign Interest (RFI), and

        (3)   Seller agrees to notify Buyer of any change in status set forth
              above.

A.9   PRE-CONTRACT COSTS

      In accordance with FAR 31.205-32, Pre-Contract Costs, which is
      incorporated herein by this reference, Subcontractor shall be entitled to
      reimbursement for costs plus applicable fees not-to-exceed $50,000
      incurred on or after 12 SEPT 2003 which, if incurred after this contract
      had been entered into, would have been reimbursable under the provisions
      of this CPFF Subcontract. The subject Pre-contract Cost Letter No.
      JS-FCS-SUGV-169, dated 08 SEPTEMBER 2003 is hereby incorporated by
      reference into this paragraph.

                                END OF SECTION A



[SAIC (R) LOGO] SCIENCE APPLICATIONS       PURCHASE CONTRACT NUMBER: 4400078647
            INTERNATIONAL CORPORATION
            An Employee-Owned Company              PAGE 7 OF 48, REV. E (SA-008)
                                                                (APRIL 22, 2005)

SECTION B - GOODS/SERVICES AND PRICES/COSTS

B.1   CONTRACT TYPE

      a.    This contract is a cost-plus-fixed-fee (CPFF). A CPFF contract is a
            cost-reimbursement contract that provides for payment to the Seller
            of a negotiated fee that is fixed at the inception of the contract.
            The fixed fee does not vary with actual cost, but may be adjusted as
            a result of changes in the work to be performed under the contract.
            The CPFF contract may take one of two basic forms -- completion or
            term. This contract may use both forms. The CPFF contract type only
            applies to the task order CLIN specified below.

      b.    Applicable to the Contract Line Item Numbers (CLINs) specified below
            are cost underrun fee provisions. Similar to cost-plus-incentive-fee
            (CPIF) contracting, but only applicable to cost underruns, these
            cost underrun incentive fee provisions reward the Seller with
            additional fee when performing a cost underrun, and satisfying the
            requirements of the SOW pursuant to the inspection and acceptance
            terms or Section E. The incentive fee provisions are defined by the
            Fee Plan set forth in Section J.

B.2   STATEMENT OF REQUIREMENTS AND TOTAL CONTRACT VALUE

      a.    Seller shall, in accordance with the terms and conditions set forth
            herein, furnish necessary, qualified personnel, services, travel,
            facilities, and materials (except those specifically designated to
            be furnished by Buyer or Government), and do all things necessary
            and incidental to complete the contractual effort in accordance with
            the Statement of Work/Specification set forth in Section C and the
            Schedule set forth in Section F.

      b.    Total contract value broken-out by CLIN descriptions, CLIN contract
            types and other summary information:



                 Internal
CLIN             Item/CCN                        Description                                                 Total Value
- ----             --------                        -----------                                                 -----------
                                                                                       
0001       01-0056-38-4133-008     Design and Development of Small Unmanned Ground
                                   Vehicle (SUGV) in accordance with Statement of
                                   Work                                                         $ 39,514,989(CPFF-COMPLETION)

0002               "               SUGV Simulations                                             $  5,928,142(CPFF-COMPLETION)
           -------------------

0003               "               SUGV Emulators                                               $          0(CPFF-COMPLETION)
           -------------------

0004               "               SUGV Prototypes                                              $    736,439(CPFF-COMPLETION)
           -------------------

0005       01-0056-38-4134-001     Training Systems                                             $  1,830,948(CPFF-COMPLETION)

0005A              "               Training Systems and Management                              $          0(CPFF-COMPLETION)
           -------------------

0005B              "               Design, Development and Verification of
           -------------------     Training Support Packages (TSP) in accordance
                                   With Specification 786-30126, Training Support
                                   Packages                                                     $          0(CPFF-COMPLETION)

0005C              "               Design, Development and Verification of
           -------------------     Embedded Training (ET) in accordance with
                                   Specification 786-30126 The supplier shall
                                   deliver a real time digital representation of
                                   the Embedded Training to be tested in the
                                   Training SIL.                                                $          0(CPFF-COMPLETION)





                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
            INTERNATIONAL CORPORATION
            An Employee-Owned Company              PAGE 8 OF 48, REV. E (SA-008)
                                                                (APRIL 22, 2005)




CLIN             Item/CCN               Description                                                     Total Value
- ----             --------               -----------                                                     -----------
                                                                                       

0006       01-0056-38-5962-001     Task Orders - Engineering Services                           (NTE)$         0 (CPFF-COMPLETION
                                                                                                                  and/or LOE (TBD))

0006A              "               Engineering Services in accordance with
           -------------------     SOW D786-10108-1 para 3.2.1.1 "Land Warrior
                                   Support"                                                     (NTE)$   335,055 (CPFF-COMPLETION
                                                                                                                  and/or LOE (TBD))

0006B              "               Engineering Services in accordance with
           -------------------     SOW D 786-10108-1 para 3.2.1.2 "Payload
                                   Development and Integration"                                 (NTE)$ 1,340,219 (CPFF-COMPLETION
                                                                                                                  and/or LOE (TBD))

0006C              "               Engineering Services in accordance with
           -------------------     SOW D786-10108-1 para 3.2.1.3 "SUGV
                                   Demonstrations"                                              (NTE)$1 ,675,274 (CPFF-COMPLETION
                                                                                                                  and/or LOE (TBD))

0007       01-0056-38-4133-008     Spares                                                            $   107,283 (CPFF-COMPLETION)

0008               "               Data and Reports in accordance with
           -------------------     Subcontract Data Requirements List (SDRL)
                                   D786-10108-2                                                 Not Separately Priced

* 0099           TBD               Non-UGV Task Order Support
                                                                                               (NTE)$    62,609 (CPFF-COMPLETION
                                                                                                                  and/or LOE (TBD))


* Letters "A", "B", etc. will be added to end of above CLIN to represent IPT
  Supported. "A" = SSEI - IPT

                                                       TOTAL CPFF   $51,530,958



                                           PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
            INTERNATIONAL CORPORATION
            An Employee-Owned Company              PAGE 9 OF 48, REV. A (SA-002)
                                                               ( APRIL 30, 2004)

                     THIS PAGE IS LEFT INTENTIONALLY BLANK



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
            INTERNATIONAL CORPORATION
            An Employee-Owned Company             PAGE 10 OF 48, REV. E (SA-008)
                                                                (APRIL 22, 2005)

c.Total contract value broken-out by CLIN cost/fee elements:



                                                   TOTAL
                                                ESTIMATED          FIXED FEE
CLIN          ESTIMATED COST      FCCOM            COST           (CPFF ONLY)           TOTAL VALUE
- ----          --------------      -----            ----           -----------           -----------
                                                                     
 0001        $    36,148,210      WAIVED      $    36,148,210   $      3,366,779    $     39,514,989

 0002        $     5,418,028      waived      $     5,418,028   $        510,114    $      5,928,142

 0003        $             0      waived      $             0   $              0    $              0

 0004        $       669,490      waived      $       669,490   $         66,949    $        736,439

 0005        $     1,670,769      waived      $     1,670,679   $        160,179    $      1,830,948

 0006A       $(NTE)  304,595      waived      $(NTE)  304,595   $(NTE)    30,460    $(NTE)   335,055

 0006B       $(NTE)1,218,381      waived      $(NTE)1,218,381   $(NTE)   121,838    $(NTE) 1,340,219

 0006C       $(NTE)1,522,976      waived      $(NTE)1,522,976   $(NTE)   152,298    $(NTE) 1,675,274

           SubTotal Clin 006      waived      $(NTE)3,045,952   $(NTE)   304,596    $(NTE) 3,350,548

 0007        $        97,530      waived      $        97,530   $          9,753    $        107,283

 0008         NSP                                                                   Not  separately
                                                                                    priced

 0099        $(NTE)   56,917      waived      $(NTE)   56,917   $(NTE)     5,692    $ (NTE)   62,609

 TOTALS:     $    47,106,896      WAIVED      $    47,106,896   $      4,424,062    $     51,530,958



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 11 OF 48, REV. E (SA-008)
                                                                (APRIL 22, 2005)

B.3   CONTRACT LINE ITEM NUMBER (CLIN) BREAKDOWN SUMMARY



                                    PREVIOUS UNIT               REVISED (CURRENT)
CLIN  QTY/UM       DESCRIPTION          VALUE      THIS CHANGE     UNIT VALUE
- ----  ------  --------------------  -------------  -----------  -----------------
                                                 
0001  1 Lot   Design and                       --           --                 --
              Development of Small
              Unmanned Ground
              Vehicle (SUGV) in
              accordance with
              Statement of Work
              D786-10108-1

              Estimated Cost        $  36,091,293  $    56,917  $      36,148,210
              FCCOM                 $           0  $         0  $               0
              Total Estimated Cost  $  36,091,293  $    56,917  $      36,148,210
              Fixed Fee             $   3,361,087  $     5,692  $       3,366,779
                                                   $
                                    -------------  -----------  -----------------
              TOTAL CPFF            $  39,452,380  $    62,609  $      39,514,989
                                    -------------  -----------  -----------------




                                        PREVIOUS UNIT               REVISED (CURRENT)
CLIN  QTY/UM        DESCRIPTION             VALUE      THIS CHANGE     UNIT VALUE
- ----  ------  ------------------------  -------------  -----------  -----------------
                                                     
0002  1 Lot                                        --           --                 --
              SUGV Simulations-
              Real time digital
              representation of the
              Supplier's product(s) to
              be used in the SoSIL
              for 1 to n systems. SIM
              s are used to round out
              to full FCS UA force
              structure. Connected
              digitally to the SoSIL
              and other FCS field
              emulators or prototypes
              with representative
              tactical communications
              and T&E Test
              Framework
              Estimated Cost            $   2,035,839  $ 3,382,189     $ 5,418,028
              FCCOM                     $           0  $         0     $         0
              Total Estimated Cost      $   2,035,839  $ 3,382,189     $ 5,418,028
              Fixed Fee                 $     192,526  $   317,588     $   510,114

                                        -------------  -----------     -----------
              TOTAL CPFF                $   2,228,365  $ 3,699,777     $ 5,928,142
                                        -------------  -----------     -----------




                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 12 OF 48, REV. C (SA-006)
                                                                (MARCH 31, 2005)



                                            PREVIOUS UNIT                REVISED (CURRENT)
CLIN  QTY/UM        DESCRIPTION                 VALUE      THIS CHANGE      UNIT VALUE
- ----  ------  ------------------------      -------------  -----------   -----------------
                                                          
0003  1 Lot                                            --           --                  --
              SUGV Emulators- Defined
              as low cost equipment, in
              SoSIL and/or field test
              use, representing the
              functionality and Human
              Machine Interface (HMI)of
              the Supplier's product with
              digital models and/or
              functional SW.
              Connected digitally with
              remote locations in order
              to be shared with FT and
              IMT. Connected digitally
              to the SoSIL and other
              FCS field emulators or
              prototypes with
              representative tactical
              communications and T&E
              Test Framework.
              Functional  equivalent  of
              prime item but not form fit.
              Estimated Cost                $     142,444  $  (142,444)  $               0
              FCCOM                         $           0  $         0   $               0
              Total Estimated Cost          $     142,444  $  (142,444)  $               0
              Fixed Fee                     $      14,272  $   (14,272)  $               0
                                                           $
                                            -------------  -----------   -----------------
              TOTAL CPFF                    $     156,716  $  (156,716)  $               0
                                            -------------  -----------   -----------------




                                         PREVIOUS UNIT               REVISED (CURRENT)
CLIN  QTY/UM        DESCRIPTION              VALUE      THIS CHANGE     UNIT VALUE
- ----  ------  -------------------------  -------------  -----------  -----------------
                                                      
0004  1 Lot                                         --           --                 --
              Sugv Prototypes
              (6 PROTO TYPES INTEGRATED
              AND READY TO BEGIN IQT.
              OF THE 6, 4 WILL BE
              DELIVERED TO SOS TESTING
              AFTER IQT.)
              (1 SHIP-IN-PLACE AT
              SUPPLIER'S FACILITY.)
              Estimated Cost             $     669,490      $  0        $   669,490
              FCCOM                      $           0      $  0        $         0
              Total Estimated Cost       $     669,490      $  0        $   669,490
              Fixed Fee                  $      66,949      $  0        $    66,949

                                         -------------      ----        -----------
              TOTAL CPFF                 $     736,439      $  0        $   736,439
                                         -------------      ----        -----------




                                    PREVIOUS UNIT               REVISED (CURRENT)
CLIN  QTY/UM      DESCRIPTION           VALUE      THIS CHANGE     UNIT VALUE
- ----  ------  --------------------  -------------  -----------  -----------------
                                                 
0005  1 Lot   Training Systems                 --           --              --
              Estimated Cost        $     524,967  $ 1,145,802     $ 1,670,679
              FCCOM                 $           0  $         0     $         0
              Total Estimated Cost  $     524,967  $ 1,145,802     $ 1,670,679
              Fixed Fee             $      52,604  $   107,575     $   160,179

                                    -------------  -----------     -----------
              TOTAL CPFF            $     577,571  $ 1,253,377     $ 1,830,948
                                    -------------  -----------     -----------




                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 13 OF 48, REV. A (SA-002)
                                                                (APRIL 30, 2004)


                                                      Total
Sub-CLIN       Task Order        Estimated           Estimated     Fixed        Total
 Number        Description         Cost      FCCOM     Cost         Fee         CPFF
- --------  --------------------  -----------  -----  -----------  ----------  -----------
                                                  
0006A     ENGINEERING           $         0  $   0  $         0  $        0  $         0
          SERVICES IN
          ACCORDANCE WITH
          SOW D786-10108-1
          PARA 3.2.1.1, "LAND
          WARRIOR SUPPORT"

0006B     PHASE 1 -             $         0  $   0  $         0  $        0  $         0
          ENGINEERING SERVICES
          IN ACCORDANCE WITH
          SOW D786-10108-1
          PARA 3.2.1.2,
          "PAYLOAD
          DEVELOPMENT AND
          INTEGRATION"

0006C     PHASE I-              $136,357.17  $   0  $136,357.17  $13,635.72  $149,992.89
          ENGINEERING SERVICES
          IN ACCORDANCE WITH
          SOW D786-10108-1
          PARA 3.2.1.3, "SUGV
          DEMONSTRATIONS"

                                -----------  -----  -----------  ----------  -----------
TOTAL                           $136,357.17  $   0  $136,357.17  $13,635.72  $149,992.89
CLIN
0006
                                -----------  -----  -----------  ----------  -----------


THE TOTAL ESTIMATED COST, FCCOM AND FIXED FEE SET FORTH IN ABOVE CLIN 004 ARE
THE SUM OF THE DEFINITIVE TASK ORDER VALUES LISTED BELOW. NOTE: UNDEFINITIVE
TASK ORDERS ARE NOT LISTED.

The Definitive Task Orders are listed below:

  Task Orders

  CPFF-LOE:

  Seller shall devote the specified level of effort for a stated time period set
  forth in the Statement of Work of each task order and amendment thereto,
  issued in accordance with Section H clause entitled "Authorization and
  Administration Of CPFF Level-Of-Effort (LOE) Task Orders."

  CPFF-COMPLETION:

  Seller shall complete the definite goal(s) and/or target(s) and deliver the
  specified end-product(s) described in the Statement of Work of each task order
  and amendment thereto, issued in accordance with Section H clause entitled
  "Authorization and Administration Of CPFF Completion Task Orders."



 Task                 Task Order
Order   SUB-CLIN      Description       Estimated    FCCOM    Fixed       Total
Number   Number   (Completion or LOE)      Cost                Fee        CPFF
- ------  --------  -------------------  ------------  -----  ----------  -----------
                                                      
 001      0006    LOE                  $ 136,357.17  $   0  $13,635.72  $149,992.89

                                       ------------  -----  ----------  -----------
TOTAL                                  $ 136,357.17  $   0  $13,635.72  $149,992.89
                                       ------------  -----  ----------  -----------




                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 14 OF 48, REV. A (SA-002)
                                                                (APRIL 30, 2004)

                     THIS PAGE IS LEFT INTENTIONALLY BLANK



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 15 OF 48, REV. A (SA-002)
                                                                (APRIL 30, 2004)

                     THIS PAGE IS LEFT INTENTIONALLY BLANK



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 16 OF 48, REV. B (SA-007)
                                                                 (APRIL 1, 2005)



CLIN   QTY/UM        DESCRIPTION       UNIT VALUE   EXTENDED VALUE
- ----   ------   --------------------   ----------   --------------
                                        
0007   1 Lot    Spares                         --               --

                Estimated Cost         $   97,530   $       97,530
                FCCOM                  $        0   $            0
                Total Estimated Cost   $   97,530   $       97,530
                Fixed Fee              $    9,753   $        9,753
                                       ----------   --------------
                TOTAL CPFF             $  107,283   $      107,283
                                       ----------   --------------




                                                       TORTAL
SUB-CLIN        TASK ORDER       ESTIMATED           ESTIMATED
 NUMBER        DESCRIPTION          COST     FCCOM     COST      FIXED FEE   TOTAL CPFF
- --------    ------------------   ---------   -----   ---------   ---------   ----------
                                                           
 0099A      NON-UGV TASK ORDER   $  56,917   $   0   $  56,917   $   5,692   $   62,609
            SUPPORT OF SSEI-IPT
                                 ---------   -----   ---------   ---------   ----------
TOTAL                            $  56,917   $   0   $  56,917   $   5,692   $   62,609
CLIN 0099
                                 ---------   -----   ---------   ---------   ----------


  THE TOTAL ESTIMATED COST, FCCOM AND FIXED FEE SET FORTH IN ABOVE CLIN 0099 ARE
  THE SUM OF THE DEFINITIVE TASK ORDER VALUES LISTED BELOW. NOTE: UNDEFINITIVE
  TASK ORDERS ARE NOT LISTED. EACH NON- UGV IPT SUPPORTED WILL BE SIGNIFIED BY A
  LETTER AFTER THE SUB-CLIN' IE. "A" = SSEI-IPT.

  THE DEFINITIVE TASK ORDERS ARE LISTED BELOW:

  TASK ORDERS

  CPFF-LOE:

  SELLER SHALL DEVOTE THE SPECIFIED LEVEL OF EFFORT FOR A STATED TIME
  PERIOD SET FORTH IN THE STATEMENT OF WORK OF EACH TASK ORDER AND AMENDMENT
  THERETO, ISSUED IN ACCORDANCE WITH SECTION H CLAUSE ENTITLED "AUTHORIZATION
  AND ADMINISTRATION OF CPFF LEVEL-OF-EFFORT (LOE) TASK ORDERS."

  CPFF-COMPLETION:

  SELLER SHALL COMPLETE THE DEFINITE GOAL(S) AND/OR TARGET(S) AND DELIVER THE
  SPECIFIED END-PRODUCT(S) DESCRIBED IN THE STATEMENT OF WORK OF EACH TASK ORDER
  AND AMENDMENT THERETO, ISSUED IN ACCORDANCE WITH SECTION H CLAUSE ENTITLED
  "AUTHORIZATION AND ADMINISTRATION OF CPFF COMPLETION TASK ORDERS."



                             TASK ORDER
                             DESCRIPTION
TASK ORDER      SUB-CLIN   (COMPLETION OR   ESTIMATED           FIXED     TOTAL
  NUMBER         NUMBER         LOE)          COST      FCCOM    FEE      CPFF
- -------------   --------   --------------   ---------   -----   ------   -------
                                                       
099A1 (MV-04)    0099A     LOE              $  18,972   $   0   $1,897   $20,869
099A2 (MV-05)    0099A     LOE              $  37,945           $3,795   $41,740
                                            ---------   -----   ------   -------
 TOTAL                                      $  56,917   $   0   $5,692   $62,609
                                            ---------   -----   ------   -------


B.4   RESERVED



                                                 PAGE 16A OF 48, REV. B (SA-007)
                                                                 (APRIL 1, 2005)

B.5   COST UNDERRUN INCENTIVE FEE TABLE

      The following table specifies the Cost Underrun Incentive Fee earned by
the Seller:

                                       TBD
                                END OF SECTION B



                                                                   Page 17 of 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

SECTION C - STATEMENT OF WORK/SPECIFICATIONS

C.1   STATEMENT OF WORK (SOW)

      Seller shall deliver goods and perform services specified in this contract
      in accordance with Buyer's Statement of Work document(s) and other
      specification documents set forth in Section J.

C.2   SUBCONTRACT DATA REQUIREMENTS LIST (SDRL)

      Seller shall deliver the data items listed on Buyer's Subcontract Data
      Requirements List (SDRL) set forth in Section J, and any other
      data/reports required by the provisions of this contract.

C.3   CONTRACT SECURITY CLASSIFICATION SPECIFICATION

      a.    Seller shall comply with the security requirements of the Contract
            Security Classification Specification, DD Form 254, as applicable,
            set forth in Section J.

      b.    Seller shall comply with Security Classification Guide, as
            applicable, set forth in Section J.

C.4   OVERRIDING PRINCIPLES, CHANGES AND CLARIFICATIONS TO WORK SCOPE

      The following constitute overriding principles, changes and clarifications
      to the contract Statement of Work set forth in Section J:

      a.    The following documents are reference documents and are provided for
            information purposes only:

            (1)   Operational Requirements Document (ORD) for the Future Combat
                  Systems

            (2)   The United States Army Objective Force Operational and
                  Organizational (O&O) Plan Unit of Action

C.5   TASK ORDERS - (LOE)

      In accordance with the Section H clause entitled "Authorization and
      Administration Of CPFF Level-Of-Effort (LOE) Task Orders," Seller shall
      prepare and submit task order proposals when requested by Buyer, and when
      authorized, perform agreed-to task orders. The statement of work specified
      in each authorized task order issued by Buyer shall be within the general
      scope of this contract.

C.6   TASK ORDERS - (COMPLETION)

      In accordance with the Section H clause entitled "Authorization and
      Administration Of CPFF Completion Task Orders," Seller shall prepare and
      submit task order proposals when requested by Buyer, and when authorized,
      perform agreed-to task orders. The statement of work specified in each
      authorized task order issued by Buyer shall be within the general scope of
      this contract.

                                END OF SECTION C



                                                                   Page 18 of 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

SECTION D - PACKAGING AND MARKING

D.1   GENERAL PACKAGING AND MARKING REQUIREMENTS

      Seller shall package, pack, preserve and mark contract deliverables (goods
      and data) in accordance with:

      a.    Best commercial practices;

      b.    Article 3 of GP4 "The Boeing Company General Provisions (Cost
            Reimbursement Contract Under Government Prime Contract);"

      c.    The Statement of Work, as applicable;

      d.    DD-254, Contract Security Classification Specification, as
            applicable; and

      e.    Clause 5068

      See the General Provisions set forth in Section I for additional
      marking/packaging requirements.

D.2   COMMERCIAL PRACTICES

      Unless otherwise specified in this contract, goods and data shall be
      preserved, packaged, packed and marked in accordance with best standard
      commercial practices which are adequate to ensure against
      damage/deterioration during transit and storage pending usage. All
      shipments and mailings shall meet the requirements of the carrier for safe
      delivery at destination.

D.3   DATA, REPORTS AND CERTIFICATIONS

      All data, reports and certifications required under this contract shall be
      --

      a.    marked with the contract number;

      b.    directed to the attention of Buyer's authorized Procurement Agent
            unless the SOW or SDRL directs otherwise; and

      c.    submitted via the Advanced Collaborative Environment (ACE) unless
            otherwise specified.

      In the event the applicable SOW includes a Subcontractor Data Requirements
      List (SDRL) or other similar list of required data, Seller's transmittal
      letter for the transmitted data shall reference the data item number,
      title, and data item description.

                                END OF SECTION D



                                                                   Page 19 of 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

SECTION E - INSPECTION AND ACCEPTANCE

E.1   INSPECTION OF RESEARCH AND DEVELOPMENT

      Buyer has the right to inspect and evaluate the work performed or being
      performed under the contract, and the premises where the work is being
      performed, at all reasonable times and in a manner that will not unduly
      delay the work. If Buyer performs inspection or evaluation on the premises
      of Seller or its subcontractor(s), Seller shall furnish and require its
      subcontractor(s) to furnish, without additional charge, all reasonable
      facilities and assistance for the safe and convenient performance of these
      duties.

E.2   INSPECTION OF SUPPLIES

      Federal Acquisition Regulation (FAR) clause 52.246-3 applies, as modified
      by article 7 of GP4 "The Boeing Company General Provisions (Cost
      Reimbursement Contract Under Government Prime Contract)."

E.3   INSPECTION OF SERVICES

      Federal Acquisition Regulation (FAR) clause 52.246-5 applies, as modified
      by article 8 of GP4 "The Boeing Company General Provisions (Cost
      Reimbursement Contract Under Government Prime)."

E.4   INSPECTION AND ACCEPTANCE AT DESTINATION

      (Unless otherwise specified, this clause applies to all work item(s).)

      Final inspection and acceptance of work accomplished, services provided
      and/or items produced or deliverable under this contract, shall be
      performed at destination by cognizant Buyer personnel.

E.5   INSPECTION AND ACCEPTANCE AT SOURCE

      (This clause applies only if the contract expressly states that an item of
      work is to be inspected and accepted at Seller's facilities or Seller's
      subcontractor's facilities.)

      a.    Final inspection and acceptance of work accomplished, services
            provided and/or items produced or deliverable under this contract
            shall be performed at Seller's facilities and/or facilities of its
            subcontractor(s), as may be approved by Buyer.

      b.    In order to accommodate Buyer's participation, Seller shall provide
            Buyer's contract technical representative and Buyer's authorized
            Procurement Agent with a minimum of at least five (5) workdays of
            advance notification, in writing, as to when and/or where the
            inspections or tests are to be performed. Although it is preferable
            that advance notification be provided in writing to Buyer's
            authorized Procurement Agent, such notification may be provided in
            any form or manner agreeable to the contracting parties.



                                                                   Page 20 of 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

E.6   MATERIAL INSPECTION AND RECEIVING REPORT

      DFARS 252.246-7000 (MAR 1996) "Material Inspection And Receiving Report,"
      is incorporated by reference. "Contractor" means Seller and "Government"
      means Buyer. If the contract requires Seller to ship supplies to the
      Government or perform services for the Government, Seller shall prepare
      and furnish a DD Form 250 to the Government with a copy provided to Buyer.
      If Seller is shipping/performing supplies/services to Buyer, Seller shall
      replace the DD Form 250 with a commercial packing slip and, as applicable,
      a Certificate of Conformance, test reports and other documentation
      evidencing completion. If Seller is shipping to Buyer by way of drop
      shipment to another Boeing or SAIC subcontractor, Seller shall prepare and
      furnish with each shipment, a commercial packing slip with copy to Buyer
      and, as applicable, a Certificate of Conformance, test reports and other
      documentation evidencing completion.

E.7   CERTIFICATE OF CONFORMANCE

      FAR 52.246-15 (APR 1984), "Certificate of Conformance," is incorporated by
      reference. "Contractor" means Seller and "Government" means Buyer. Seller
      shall not use the DD Form 250 (see paragraph (b) of the referenced clause)
      unless Seller is shipping directly to the Government. In shipments to
      Buyer, Seller shall use commercial shipping/packing lists. Seller is not
      required to provide a Certificate of Conformance for a contract
      deliverable that has been inspected and accepted at Seller's facility by
      Government or Buyer, unless otherwise specified as a requirement by the
      contract Statement of Work or Subcontract Data Requirements List. Seller
      is not required to submit a Certificate of Conformance under this clause
      for deliverable data items. "Inspected at Seller's facility" as used in
      this modified clause means final inspection and acceptance by Government
      or Buyer at Seller's facility.

                                END OF SECTION E



[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 21 OF 48, REV. C (SA-008)
                                                                (APRIL 22, 2005)

SECTION F - DELIVERIES OR PERFORMANCE

F.1   GENERAL SHIPPING/DELIVERY REQUIREMENTS

      a.    Seller shall comply with the shipping requirements in article 3 of
            GP4 "The Boeing Company General Provisions (Cost Reimbursement
            Contract Under Government Prime Contract)."

      a.    FAR 52.247-34, "F.o.b. - Destination," is incorporated by reference.
            "Contractor" means Seller and "Government" means Buyer.

      b.    In the event a required item under this contract is delivered
            directly to Buyer's technical representative, Seller shall obtain a
            signed receipt from Buyer's technical representative evidencing such
            delivery. Further, Seller shall provide a copy of such signed
            receipt to Buyer's authorized Procurement Agent.

      c.    See the General Provisions set forth in Section I for additional
            shipping/delivery requirements.

F.2   DELIVERY DESTINATIONS

      Absent any specific delivery destination(s) set forth in the contract
      Statement of Work, Seller shall deliver all supplies deliverables, with
      the exception of data and correspondence to the APPLICABLE LSI FACILITIES
      AS DIRECTED BY THE INTEGRATED PRODUCT TEAM LEAD OR SUB-LEAD (IPT):

              HOUSTON
              THE BOEING COMPANY
              INTEGRATED DEFENSE SYSTEMS - FCS PROGRAM
              13100 SPACE CENTER BLVD.
              HOUSTON, TEXAS 77059
              ATTENTION: JASON COX - GOVERNMENT PROPERTY MANAGEMENT, (281)
              244-3069

              HUNTINGTON BEACH
              THE BOEING COMPANY
              INTEGRATED DEFENSE SYSTEMS - FCS PROGRAM
              5222 RANCHO ROAD
              HUNTINGTON BEACH, CALIFORNIA 92647
              ATTENTION: GFP CAGE BUILDING 040

              MESA
              THE BOEING COMPANY
              INTEGRATED DEFENSE SYSTEMS - PCS PROGRAM
              5000 EAST MCDOWELL ROAD
              MESA, ARIZONA 85215 -- 9797
              ATTENTION: GOVERNMENT PROPERTY STORES - FCS

              PHILADELPHIA
              THE BOEING COMPANY
              INTEGRATED DEFENSE SYSTEMS - FCS PROGRAM
              BLDG 3-60
              STEWART AVE & INDUSTRIAL HWY
              RIDLEY PARK, 19078



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company      PAGE 21A OF 48, REV. NEW (SA-008)
                                                                (APRIL 22, 2005)

              SEATTLE
              THE BOEING COMPANY
              INTEGRATED DEFENSE SYSTEMS - FCS PROGRAM
              9725 EAST MARGINAL WAY S.
              MMA35
              BLDG 9-101, DOOR N9, COL. H9
              SEATTLE, WASHINGTON 98108

              ST. LOUIS
              THE BOEING COMPANY
              INTEGRATED DEFENSE SYSTEMS - FCS PROGRAM
              BUILDING 220
              153 J.S. MCDONNELL BLVD.
              HAZELWOOD, MISSOURI 63042
              ATTENTION: PROPERTY WAREHOUSE / SCOTT STEVENS

      Absent any specific delivery destination(s) set forth in the contract
      Statement of Work, Seller shall deliver all data and correspondence to the
      following Buyer's facility:

      Science Applications International Corporation
      6725 Odyssey Drive
      Huntsville, Alabama 35806
      Attention: J.R. (Rick) Yoast
      Mail Code: MB#4

F.3   PERFORMANCE

      a.    The principal place of performance under this contract shall be
            Seller's facilities located at 63 South Avenue, Burlington MA
            01803-4903.



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 22 OF 48, REV. B (SA-006)
                                                                (MARCH 31, 2005)

      b.    If Seller encounters difficulty in meeting performance requirements,
            or anticipates difficulty in complying with the contract delivery
            schedule(s) or date(s), Seller shall immediately notify Buyer's
            authorized Procurement Agent in writing giving pertinent details;
            provided, however, that this data shall be informational only in
            character and that this clause shall not be construed as a waiver by
            Buyer of any delivery/performance schedule or any rights or remedies
            provided by law or under this contract.

F.4   PERIOD OF PERFORMANCE

      a.    The contract period of performance is:



CLIN  Start Date                        Completion Date
- ----  ----------                        ---------------
                                  
0001  Nov 2003                          MAR 2013
0002  Nov 2003                          MAR 2013
0003  Nov 2003                          *N/A
0004  Nov 2003                          MAR 2013
0005  Nov 2003                          MAR 2013
0006  Nov 2003                          MAR 2013
0007  Nov 2003                          MAR 2013
0008  In Accordance with SDRL Schedule


* THE EMULATOR REQUIREMENTS AS RELATED TO CLIN 0003 ARE ELIMINATED.

      b.    Buyer is not obligated to reimburse Seller for any work performed or
            costs incurred before or after the specified start or completion
            date(s) of the respective CLIN specified above unless agreed in
            writing by Buyer's authorized Procurement Agent.

      c.    The contracting parties agree that Seller shall perform reasonable
            and necessary closeout duties after the performance period end date
            noted herein.

      d.    Any extension of the performance periods requires Buyer's written
            approval.

F.5   CONTRACT DELIVERABLES

      a.    Data Items. Seller shall deliver data items in accordance with the
            Subcontract Data Requirements List Data (SDRL) and accompanying Data
            Item Description (DID), as applicable. Unless specified otherwise,
            submittal of data deliverables, i.e., SDRL items, will be via the
            Advanced Collaborative Environment (ACE). Data deliverables will be
            marked in accordance with the Data and Software Rights article of
            clause 5068 and other marking requirements set forth in this
            contract.

      b.    Other Data/Information. Day-to-day IPT products such as technical
            assessment results, analyses, trade studies, and plans, will be made
            available to Buyer via the ACE. However, unless such day-to-day IPT
            products are explicitly specified as a contract deliverable, i.e.,
            SDRL, these products will not be subject to the marking requirements
            specified in the Data and Software Rights article of clause 5068.



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 23 OF 48, REV. B (SA-006)
                                                                (MARCH 31, 2005)

      c.    Supplies/Goods. Seller shall deliver goods in accordance with the
            Contract Delivery/Performance Schedule set forth in Section J-16.

      d.    Task Orders. Seller shall perform task order effort and deliver
            goods and/or data, as applicable in accordance with any task order
            issued under this contract.

F.6   CONTRACT PERFORMANCE SCHEDULE

      The contract performance milestones and events and their corresponding
      required completion dates are in the Contract Delivery/Performance
      Schedule set forth below.



MILESTONE                   EVENT                           SCHEDULE *
- ---------   -----------------------------------------   ------------------
                                                  
   1        UGV System Requirements Review (UGVSRR)_    NLT June 2004
   2        UGV System Functional Review (UGVSFR)       NLT September 2004
   3        Complete System Requirements Review (SRR)   NLT January 2005
   4        COMPLETE SYSTEM FUNCTIONAL REVIEW (SFR)     NLT DECEMBER 2005
   5        Complete Preliminary Design Review (PDR)    NLT SEPTEMBER 2006
   6        Complete Critical Design Review (CDR)       NLT JULY 2007
   7        Commence Delivery of Prototypes             NLT AUGUST 2009


      * IN ACCORDANCE WITH J-12 SUGV SCHEDULE.

 F.7  PROGRAM SCHEDULE

      Seller shall support the Program Integrated Master Schedule (IMS) document
      set forth in Section J-12. The FCS Program IMS is an integrated master
      schedule of time-phased tasks that supports the Program Events and
      associated Significant Accomplishments of the Integrated Master Plan
      (IMP).

F.8   FCS PROGRAM MAJOR MILESTONE SCHEDULE

      a.    THESE ARE THE SIGNIFICANT FCS PROGRAM EVENTS, ALONG WITH THE MAJOR
            MILESTONE DATE FOR EACH EVENT.



              FCS PROGRAM MILESTONE                    EVENT DATE           COMMENT
- ----------------------------------------------------   ----------   ------------------------
                                                              
PROGRAM DEFINITIZATION                                 11/26/2003   COMPLETE
SOS SRR                                                12/18/2003   COMPLETE
SOS DCR                                                06/18/2004   COMPLETE
SOSFR {ENGINEERING MATURITY 0(END OF EI0)              08/11/2005
CAPABILITY MATURITY 0 (END OF IV0;) IPDR, IN PROCESS   06/29/2006
PRELIMINARY DESIGN REVIEW
ENGINEERING MATURITY 1 (END OF EI1)                    06/28/2007
CAPABILITY MATURITY 1 (END OF IV1); ICDR, IN-PROCESS   09/25/2008
CRITICAL DESIGN REVIEW
ENGINEERING MATURITY 2 (END OF EI2)                    06/25/2009
CAPABILITY MATURITY 2 (END OF IV2)                     09/30/2010
ENGINEERING MATURITY 3 (END OF EI3)                    06/23/2011
CAPABILITY MATURITY 3 (END OF IV3)                     09/27/2012
ENGINEERING MATURITY 4 (END OF EI4)                    06/20/2013   BEYOND POP OF
                                                                    CONTRACT - FOR INFO ONLY

VERIFICATION COMPLETE (END OF IV4)                     12/11/2014   BEYOND POP OF
                                                                    CONTRACT - FOR INFO ONLY
SDD CLOSEOUT                                           12/18/2014   BEYOND POP OF
                                                                    CONTRACT- FOR INFO ONLY




                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company      PAGE 23A OF 48, REV. NEW (SA-006)
                                                                (MARCH 31, 2005)

      b.    ABBREVIATIONS/ACRONYMS. THE FOLLOWING NAMES/DESCRIPTIVE TERMS APPLY
            TO THE ABBREVIATIONS/ACRONYMS USED IN PARAGRAPH "a." ABOVE:

            DCR     DESIGN CONCEPT REVIEW
            EI      ENGINEERING ITERATIONS
            ICDR    IN PROCESS CRITICAL DESIGN REVIEW
            IPDR    IN PROCESS PRELIMINARY DESIGN REVIEW
            IPR     IN PROCESS REVIEW
            I&V     INTEGRATION AND VERIFICATION
            SOS     SYSTEM OF SYSTEMS
            SOSFR   SYSTEM OF SYSTEMS FUNCTIONAL REVIEW
            SRR     SYSTEM REQUIREMENTS REVIEW
            UA      UNIT OF ACTION
            POP     PERIOD OF PERFORMANCE

                                END OF SECTION F



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 24 OF 48, REV. A (SA-002)
                                                                (APRIL 30, 2004)

SECTION G - CONTRACT ADMINISTRATION DATA

G.1   INVOICE AND PAYMENT

      The overall reimbursement structure of this contract is Cost-Plus-Fix-Fee,
      as defined in Section B.1, and applies to all CLINs. In consideration for
      performing contract activities, Seller shall invoice and receive Buyer
      payments in accordance with the provisions of this Section G, and the
      Invoice and Payment article of GP4 "The Boeing Company General Provisions
      (Cost Reimbursement Contract Under Government Prime Contract)."

G.2   PAYMENT OF FIXED FEE - ALL NON-TASK ORDER CLINs

      a.    Subject to the "Fixed Fee" clause of GP4 "The Boeing Company General
            Provisions (Cost Reimbursement Contract Under Government Prime),"
            Seller will be paid in installments at the time of each provisional
            payment on account of the allowable costs. The amount of fixed fee
            paid will be based on the ratio that the Seller's incurred allowable
            costs bear to the total estimated cost. The method of fee payment is
            as follows (percent completion method based on cost):

            Total payable fixed fee by CLIN is equal to the total CLIN fixed fee
            amount set forth in the contract multiplied by the quotient of total
            incurred/expended CLIN cost divided by total estimated CLIN cost
            specified in the contract:


                                          
  Total Payable   =  [Total CLIN Fixed Fee]  X   [Total Incurred/Expended CLIN Cost]
                                                ------------------------------------
Fixed Fee by CLIN   [Specified in Contract]     [Total Estimated CLIN Cost Specified
                                                            In Contract]


            Total payable CLIN fixed fee (calculated from above) minus (previous
            paid fixed fee) equals the current fixed fee payment installment.

      b.    For each non-task order CLIN, if the Seller does not successfully
            complete the stated goals, targets and end-product deliveries of the
            Statement of Work required by the contract, and Buyer does not
            authorize more effort with an increase in cost, the fixed fee of the
            applicable CLIN shall be equitably adjusted downward. However, if
            Seller completes the stated goals, targets and end-product
            deliveries of the Statement of Work required by contract, and under
            runs the costs, the Seller is entitled to the entire fixed fee for
            the applicable CLIN.

G.3   COST UNDERRUN INCENTIVE -- ALL NON-TASK ORDER CLINs

      In addition to the payable fixed fee, Seller may earn additional fee in
      accordance with the enclosure entitled "Underrun Fee Provisions," set
      forth in Section J.

G.4   PAYMENT OF FIXED FEE - CPFF (LOE) TASK ORDER CLINs (0006 ONLY)

      a.    Subject to the "Fixed Fee" clause of GP4 "The Boeing Company General
            Provisions (Cost Reimbursement Contract Under Government Prime),"
            the fixed fee for each task order authorized in accordance with the
            Section H clause entitled "Authorization and Administration Of CPFF
            Level-Of-Effort (LOE) Task Orders," shall be paid -

               -     at the end of the period of performance (expiration
                     date) set forth in the task order;

               -     after Buyer's receipt of an acceptable invoice; and

               -     after Buyer's acceptance of Seller's "Certificate of
                     Utilization of Hours" and the task order effort



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 25 OF 48, REV. A (SA-002)
                                                                (APRIL 30, 2004)

      b.    In the event the Seller does not expend the specified LOE (minimum
            quantity of direct labor hours) required by the authorized task
            order within the specified time period, the task order fixed fee
            shall be equitably adjusted downward. However, if Seller expends the
            specified LOE within the specified time period and under runs the
            task order costs, the Seller is entitled to the entire fixed fee of
            the task order.

G.5   PAYMENT OF FIXED FEE - CPFF (COMPLETION) TASK ORDER CLINs (0006 ONLY)

      a.    Subject to the "Fixed Fee" clause of GP4 "The Boeing Company General
            Provisions (Cost Reimbursement Contract Under Government Prime),"
            the fixed fee for each task order authorized in accordance with the
            Section H clause entitled "Authorization and Administration Of CPFF
            Completion Task Orders," shall be paid in installments no more than
            once every two weeks upon receipt of an acceptable invoice, and at
            the same time Seller's task order costs are invoiced;

            Calculation of fixed fee will be based upon the ratio of cumulative
            task order costs incurred, to date, to the total estimated task
            order costs. Example:


                                              
Total Payable Task =     [Total Fixed Fee]      X   [Total Incurred/Expended Task Order Cost]
                                                      ---------------------------------------
   Order Fixed Fee     [Specified in Task Order]        [Total Estimated Cost Specified in
                                                                 Task Order]


            Total payable fixed fee (calculated from above) minus (previous paid
            fixed fee) equals the current fixed fee payment installment.

      b.    The Buyer will not pay the last task order invoice until after
            Buyer's acceptance of Seller's "Certificate of Completion" and the
            task order effort.

      c.    In the event the Seller does not successfully complete the stated
            goals, targets and end-product deliveries of the Statement of Work
            required by the task order, and the Buyer does not authorize more
            effort with an increase in cost, the task order fixed fee shall be
            equitably adjusted downward. However, if Seller completes the task
            order, submits an acceptable Certificate of Completion and under
            runs the task order costs, the Seller is entitled to the entire
            fixed fee of the task order.

G.6   PAYMENT TERMS

      Payment terms are listed on page 1 of the contract.

G.7   STATE SALES - USE TAX

      All goods and services purchased under this contract are for resale
      through the State of Alabama or the State of California and are for resale
      under a Prime Government Contract number DAAE07-03-9-F001. Buyer's Tax
      Permit Number(s) are as follows: #6800-04-119 for the State of Alabama or
      #SYFH25- 646030 for the State of California.



                                          PURCHASE CONTRACT NUMBER:   4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 26 OF 48, REV. A (SA-001)
                                                             (FEBRUARY 09, 2004)

G.8   SUBMISSION OF INVOICES

      Seller shall submit invoices no more than once every two weeks. Seller
      shall submit an original and two (2) duplicate copies of the invoice for
      provisional payment to the following location:

      Science Applications International Corporation
      6725 ODYSSEY DRIVE
      HUNTSVILLE, ALABAMA 35806
      Attention: J.R. (Rick) Yoast
      Mail Code: MB#4

      In addition, Seller shall mail and, if requested, fax a copy of the
      invoice to Buyer's authorized Procurement Agent for provisional approval
      of payment.

G.9   INVOICE CONTENTS

      Seller shall prepare and submit invoices and attachments to include the
      following minimum information:

      a.    Seller's name and business address; invoice number and date; Buyer's
            contract number and original date of award; prime contract number;
            name of Buyer's authorized Procurement Agent; CLIN/ltem Number;
            description of goods and/or services with corresponding part
            numbers, unit of measure, quantities and unit prices; separately
            itemized taxes; extended totals; Seller's signature and payment
            terms. Invoices shall include the "Amount Previously Billed," the
            "Amount of this Invoice," the "Total Amount Billed to Date", and the
            "Amount of Withhold". Seller shall submit invoices for the full
            amount stating the amount of withhold/retention for each line item
            billed.

      b.    Name and telephone number of Seller's representative to be notified
            if the invoice is incorrect or there are questions.

      c.    Date of delivery or service. Enter the date(s) that the goods or
            services billed were provided to Buyer, or during which the billed
            costs and fees were incurred. All costs billed must have been
            incurred within the contract period of performance.

      d.    CLIN/ltem amounts. Segregate charges by CLIN/ltem, and enter amounts
            billed for cost and fee on separate lines. Any credits listed on the
            invoice must also be segregated by CLIN/ltem and identified as
            applicable to cost and/or specified category of fee.

      e.    Certification and signature. Enter the signature (electronic
            equivalent is acceptable) of Seller's authorized representative and
            date of said signature after the following certification language:
            "Pursuant to authority vested in me, I certify that this invoice is
            correct and proper for payment."

      f.    Cost Plus Fixed Fee LOE Task Order invoices must contain the number
            of labor hours expended and certification that the hours expended
            are correct in accordance with the certification referred to in
            paragraph H. 18 b. of the subcontract.

      Invoices submitted without the above information may be returned to Seller
      for correction.



                                                                   Page 27 OF 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

G.10  TECHNICAL AND ADMINISTRATIVE REPRESENTATIVES

      a.    The following Technical and Contract Representatives are designated
            for this contract:

            Seller's Technical Representative is: Robert A. Bell, FCS Program
            Manager

            Seller's Contract Representative is: Robert L. Moses, Director,
            Acquisitions & Business Development

            Buyer's Technical Representative is: John Possel, SUGV Program
            Manager

            Buyer's Procurement Agent is: J.R. (Rick) Yoast, Sr. Subcontracts
            Administrator

            In the event Buyer's Procurement Agent specified above is not
            available, Janice Schuckman, Subcontracts Manager or his/her duly
            authorized representative shall serve as Buyer's authorized
            Procurement Agent. In the event Seller's Contract Representative
            (Contract Manager/Administrator) is not available, M. David Adler,
            Sr. Vice-President & Treasurer or his/her duly authorized
            representative shall serve as Seller's Contract Representative.

      b.    Buyer's Technical Representative is responsible for day-to-day
            clarifications, guidance and technical direction as may be required
            within the scope of the technical work requirements, "technical
            direction" shall be in accordance with the "Technical Direction"
            clause of the General Provisions of the contract

      c.    Contact between the contracting parties regarding prices, terms,
            quantities, deliveries, and financial adjustments shall only be made
            between the above-designated Contract Representative (Seller) and
            Procurement Agent (Buyer). Actions taken by Seller, which by their
            nature effect a change to this contract, shall be binding upon Buyer
            only when such action is specifically authorized in writing by
            Buyer's authorized Procurement Agent. Unless specified otherwise in
            this contract, all written communications between the contracting
            parties shall be directed between the above-designated Contract
            Representative and Procurement Agent.

      d.    Buyer shall be responsible for all liaison and communications with
            Buyer's customer as well as other Buyer subcontractors for the term
            of this contract. Seller shall not communicate with Buyer's customer
            or Buyer's other subcontractors regarding this contract except with
            prior consent of Buyer or when already expressly authorized by this
            contract.

      e.    No request, notice, authorization, direction or order received by
            Seller shall be binding upon Buyer, or serve as the basis for a
            change in the contract, unless issued (or confirmed) in writing by
            Buyer's authorized Procurement Agent.

      f.    Seller shall immediately notify Buyer's authorized Procurement Agent
            whenever a verbal or written change notification has been received
            from an employee of Buyer (other than the Procurement Agent), which
            would affect any of the terms, conditions, cost, schedules, etc., of
            this contract, and Seller is to perform no work or make any changes
            in response to any such notification or make any claim on Buyer
            unless Buyer's authorized Procurement Agent directs Seller, in
            writing, to implement such change notification.

                                END OF SECTION G



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 28 OF 48, REV. F (SA-006)
                                                                (MARCH 31, 2005)

SECTION H - SPECIAL PROVISIONS

H.1   INCREMENTAL FUNDING

      a.    The total sum presently available for payment and allotted to this
            contract is $10,216,889.89, which is estimated to cover all CLINs
            listed below, including reasonable amounts for termination and for
            fee. The funds depletion date (the estimated date on which funding
            will be exhausted) for each CLIN is specified below. Total funding
            allotted to each applicable CLIN and corresponding funds depletion
            date are as follows:



CLIN                 Funds Allotted             Est. Funds Depletion Date
- ----   -------------------------------------  -------------------------------
                                       
0001   $ 9,839,788.00                        31 MAY 2005 (AS OF ACFO NO. 010)
0002   CLIN Part of CLIN 0001 - not specifically funded
0003   CLIN Part of CLIN 0001 - not specifically funded
0004   CLIN Part of CLIN 0001 - not specifically funded
0005   $    227,109.00                       31 MAY 2005 (AS OF ACFO NO. 010)
0006   $    149,992.89                       28 MAY 2004 (as of ACFO No.004)
0007   CLIN Part of CLIN 0001 - not specifically funded
0008   CLIN Part of CLIN 0001 - not specifically funded


      b.    Incremental funding provided for CLINs 0006 (above) is a total
            not-to-exceed value for these CLINs. Actual funding values shall be
            provided individually within each authorized Task Order, and total
            estimated cost, FCCOM and fised fee for CLINs 0006 are the sum of
            the definitive task order values listed in Section.3.a of this
            subcontract.

      c.    Notwithstanding any other provision of this contract, all payments
            to Seller shall be subject to the funding limitation(s) set forth
            above.

      d.    All changes in funding as contemplated by the "Limitation of Funds"
            clause in the General Provisions of this contract will be made by
            way of a Contract Change Funding Order. Each such Contract Change
            Funding Order shall state the total funds allotted for the
            performance of this contract and the estimated period of time or
            funds depletion date to be covered by the funds then allotted. The
            provisions relating to funds allotted and time period or funding
            depletion date covered thereby shall be deemed modified in
            accordance with each such Contract Change Funding Order.

H.2   BUYER FURNISHED EQUIPMENT, PROPERTY, INFORMATION, FACILITIES, AND SERVICES

      Pursuant to Buyer's Property clause(s) set forth in Section I General
      Provisions, Buyer shall furnish to Seller in the performance of this
      contract the Equipment, Property, Information, Facilities, and Services
      (hereinafter collectively referred to as "BFX") identified on the list
      entitled "BFX List." The BFX List is set forth by attachment in Section
      J-7 entitled "BFX List."



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 29 OF 48, REV. A (SA-004)
                                                             (SEPTEMBER 2, 2004)

H.3   GOVERNMENT-FURNISHED ASSETS (GFX)

      (a)   THE TERM "GFX," AS USED IN THIS CLAUSE, MEANS GOVERNMENT-FURNISHED
      ASSETS CONSISTING OF EQUIPMENT, PROPERTY, INFORMATION, FACILITIES AND
      SERVICES. GFX SHALL NOT BE FURNISHED TO THE SELLER UNTIL APPROVED BY THE
      FCS GRANTS OFFICER (GOVERNMENT).

      (b)   EACH ITEM OF GFX IN THE BELOW LIST IS DESIGNATED AS EITHER
      SELLER-PROPOSED GFX OR GOVERNMENT-APPROVED GFX. GFX THAT IS DESIGNATED
      SELLER-PROPOSED WILL BE CHANGED TO GOVERNMENT-APPROVED WHEN BUYER RECEIVES
      GOVERNMENT AUTHORIZATION OR APPROVAL FOR SELLER'S USE OF THE GFX. THE
      GOVERNMENT IS NOT OBLIGATED TO FURNISH ANY ITEM OF GFX UNTIL SUCH
      AUTHORIZATION/APPROVAL IS RECEIVED BY BUYER. UPON RECEIPT OF SUCH
      GOVERNMENT AUTHORIZATION/APPROVAL, BUYER WILL ISSUE A UNILATERAL,
      ADMINISTRATIVE MODIFICATION TO THIS CONTRACT CHANGING THE DESIGNATION OF
      THE GFX FROM SELLER-PROPOSED GFX TO GOVERNMENT-APPROVED GFX.

      (c)   IN THE EVENT THE GOVERNMENT DISAPPROVES SELLER'S REQUEST FOR USE OF
      GFX, OR THE GOVERNMENT APPROVES SELLER'S REQUEST, BUT SUCH APPROVAL DOES
      NOT MEET THE SELLER'S REQUIREMENTS SPECIFIED IN THE BELOW GFX LIST (E.G.,
      GFX ARRIVES LATER THAN THE SPECIFIED NEED-DATE, AND, AS A DIRECT RESULT,
      SELLER INCURS ADDED/UNPLANNED COSTS TO IMPLEMENT A WORK-AROUND SCHEDULE),
      THE CONTRACT SHALL BE SUBJECT TO EQUITABLE ADJUSTMENT.

      (d)   SELLER SHALL ASSIST BUYER IN OBTAINING GOVERNMENT APPROVAL FOR
      SELLER'S-USE OF GFX BY -

      1.    ASSISTING BUYER IN COMPLETING THE FCS GFX REQUEST FORM FOR
      SELLER-PROPOSED GFX. THIS GFX REQUEST FORM AND THE INSTRUCTIONS FOR
      COMPLETING THE FORM ARE AVAILABLE TO THE SELLER VIA ACE.

      2.    ASSISTING BUYER IN OBTAINING A WRITTEN STATEMENT OF AVAILABILITY
      FROM THE GOVERNMENT-OWNER/CUSTODIAN OF THE SUBJECT GFX. THE STATEMENT OF
      AVAILABILITY WILL CLEARLY STATE THE AVAILABILITY TERMS OF THE REQUESTED
      GFX. SUCH AVAILABILITY TERMS INCLUDE DATES OR TIME FRAME WHEN THE GFX WILL
      BE AVAILABLE FOR USE BY SELLER. IF THE GFX WILL NOT BE AVAILABLE TO THE
      FCS PROGRAM ON A NO-COST, RENT-FREE USE BASIS, THE STATEMENT OF
      AVAILABILITY WILL INCLUDE THE RENTAL TERMS. IF THE GFX IS NOT AVAILABLE
      FOR ANY OTHER REASONS, THESE REASONS SHALL BE CLEARLY STATED.

      (e)   RECEIPT OF GFX -

      1.    SELLER SHALL NOTIFY BUYER PROMPTLY UPON RECEIPT OF GFX. SUCH
      NOTIFICATION SHALL INCLUDE PROVIDING A LIST OF GFX RECEIVED BY SELLER'S
      SUBCONTRACTORS/SUPPLIERS.

      2.    UPON RECEIPT OF GFX, SELLER SHALL INSPECT THE GFX TO IDENTIFY ANY
      OVERAGES, SHORTAGES, OR DAMAGES. SELLER SHALL PROVIDE BUYER A WRITTEN
      REPORT OF ANY OVERAGES, SHORTAGES OR DAMAGES AND THEIR APPARENT CAUSES.

      3.    SELLER WILL INCORPORATE THE SUBSTANCE OF THIS PARAGRAPH (e) IN ALL
      SUBCONTRACTS THAT MAY INVOLVE GFX AND WILL PROVIDE TO BUYER REPORTS OF
      OVERAGES, SHORTAGES, OR DAMAGES RECEIVED FROM LOWER TIER SUBCONTRACTORS.

      (f)   GFX LIST

      THE GFX LIST IS SET FORTH BY ATTACHMENT IN SECTION J-7 ENTITLED "GFX LIST

H.4   DATA OR SOFTWARE TO BE PROVIDED WITH RESTRICTIONS

      In accordance with the Data and Software Rights article of clause 5068,
      Seller and Seller's subcontractors/suppliers have identified data and
      software to be furnished with restrictions. This identified data and
      software is set forth by attachment in Section J entitled "Data or
      Software to be Provided With Restrictions."



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company        PAGE 29A OF 48, REV. B (SA-006)
                                                                (MARCH 31, 2005)

H.5   ORDERING FROM GOVERNMENT SUPPLY SOURCES (PRIME FLOWDOWN)

      SELLER IS AUTHORIZED TO USE GOVERNMENT FEDERAL SUPPLY SCHEDULE CONTRACTS
      IN THE PERFORMANCE OF THIS AGREEMENT. THIS AUTHORIZATION IS ISSUED IN
      ACCORDANCE WITH PROVISIONS OF 48CRF SUBPART 51.1 "CONTRACTOR USE OF
      GOVERNMENT SUPPLY SOURCES" AND CAN BE USED ONLY TO ACQUIRE GOODS AND
      SERVICES REQUIRED SPECIFICALLY FOR PERFORMANCE UNDER THIS AGREEMENT AS SET
      FORTH IN NEW ATTACHMENT J-10 AND LISTED IN SECTION J.

      FOR EACH ORDER PLACED TO A FEDERAL SUPPLY SCHEDULE VENDOR (1) A COPY OF
      THE AUTHORIZATION LETTER MUST ACCOMPANY THE ORDER, UNLESS A COPY WAS
      PREVIOUSLY FURNISHED TO THE VENDOR, AND (2) THE FOLLOWING STATEMENT MUST
      APPEAR ON THE ORDER:

            "THIS ORDER IS PLACED UNDER AGREEMENT DAAE07-03-9-F001, DATED MAY
            30, 2003, WITH U.S. ARMY TANK-AUTOMOTIVE AND ARMAMENTS COMMAND
            (TACOM) AND AS PROVIDED BY AUTHORIZATION LETTER DATED 11 JUN 2003.
            IN THE EVENT OF ANY INCONSISTENCY BETWEEN THE TERMS AND CONDITIONS
            OF THIS ORDER AND THOSE OF YOUR FEDERAL SUPPLY SCHEDULE CONTRACT,
            THE LATTER WILL GOVERN."

      SELLER'S ORDERING AUTHORIZATION MAY BE UNILATERALLY WITHDRAWN, OR
      SUSPENDED, IN WHOLE OR IN PART, BY PROVIDING WRITTEN NOTICE TO THE SELLER.

H.6   KEY PERSONNEL

      a.    The following key personnel are considered essential to this
            contract and are considered full-time participants:

                NAME                     TITLE
                --------------           -------------------
                Robert A. Bell           FCS Program Manager
                MIKE BASSETT             Technical IPT Lead
                Judith Blinn             Contracts MANAGER
                Chris Norman             SoS IPT Lead

      b.    In the event Seller removes any of the above personnel from the
            contract, Seller shall notify in writing Buyer's authorized
            Procurement Agent and will provide a qualified replacement.

H.7   RESERVED

H.8   CERTIFICATION OF FINAL INDIRECT COSTS (PRIME FLOWDOWN)

      a.    For the purposes of this certificate, Seller will submit the
            standard FAR certificate of final indirect costs (see FAR 52.242-4)
            to the cognizant Government activity. If a Seller is not otherwise
            required to submit the standard FAR certificate for final indirect
            costs, then it shall submit the certificate below.

      b.    Seller (as applicable) shall (1) certify, in the format below, any
            proposal to establish or modify final indirect cost rates; and (2)
            have the certificate signed by an individual of Seller's
            organization at a level no lower than a vice president or chief
            financial officer of Seller's business segment that submits the
            proposal.

      c.    Failure to execute and submit the certification described may result
            in final indirect cost rates being unilaterally established by the
            Government Grants Officer or Government Administrative Agreements
            Officer. The Grants Officer may request a copy of Seller's
            Certificate of Final Indirect Costs from the cognizant Government
            agency assigned (e.g. DCAA, DCMA).



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                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

                       Certificate of Final Indirect Costs

                  This is to certify that I have reviewed this proposal to
                  establish final indirect cost rates and to the best of my
                  knowledge and belief, all costs included in this proposal
                  (identify proposal and date) to establish final indirect cost
                  rates for (identify period covered by rate) are allowable in
                  accordance with the cost principles of the Federal Acquisition
                  Regulation (FAR) and its supplements, or in the case of a
                  non-traditional defense contractor in accordance with GAAP,
                  applicable to the contracts to which the final indirect cost
                  rates apply.

                        Firm:___________________________________________________
                        Signature:______________________________________________
                        Name of Certifying Official:____________________________
                        Title:__________________________________________________
                        Date of Execution:______________________________________

      d.    Seller shall submit the above certificate to Buyer's authorized
            Procurement Agent at the time it establishes its final, annual
            indirect cost rates, except when Seller is submitting to the
            cognizant Government activity the standard FAR certificate of final
            indirect costs. If Seller is submitting the standard FAR
            certificate, Seller shall provide written notification to Buyer's
            authorized Procurement Agent of this occurrence.

H.9   EQUITABLE ADJUSTMENT (PRIME FLOWDOWN)

      a.    General. Any reference to an Equitable Adjustment under this
            contract is subject to this definition.

      b.    Definition. The term "Equitable Adjustment" refers to whenever a
            provision of this contract states that Seller may be or is entitled
            to an "Equitable Adjustment," Buyer, at its sole option, may direct
            that the modification implementing the adjustment (1) maintain the
            overall schedule and estimated cost by removing requirements from
            the statement of work that reduce cost and/or schedule by an amount
            equal to the increased cost and/or schedule caused by the event
            giving rise to the Equitable Adjustment or (2) increase estimated
            cost and/or schedule, as appropriate, to account for the impact of
            the change.

      c.    Unless directed otherwise by Buyer's authorized Procurement Agent,
            any request by Seller for an Equitable Adjustment will maintain the
            overall schedule and estimated cost and include recommendations of
            statement of work requirements to be modified, reduced, or deleted
            in order to perform within the existing contract schedule and cost
            boundaries. Adjustments implemented under b (1) above will not cause
            any revision to the amount of Fee available for this contract.

H.10  MODIFICATIONS (PRIME FLOWDOWN)

      a.    General. At any time during the term of the contract, contract
            progress or contract results may indicate that a change in the
            contract would be beneficial to the contract or FCS program
            objectives. Recommendations made by Seller for modifications,
            including justifications by Seller to support any proposed changes
            in the contract, excluding equitable adjustment proposals submitted
            under the Changes article of clause GP4 "The Boeing Company General
            Provisions (Cost Reimbursement Contract Under Government Prime
            Contract)", will be documented in a letter and submitted by Seller
            to Buyer's authorized Procurement Agent. This documentation letter
            will (1) detail the technical, chronological, and financial impact
            of the proposed modification; and (2) identify what work is being
            modified, reduced or deleted to accommodate the proposed change. If
            Seller believes it cannot maintain the overall schedule and
            estimated cost within the existing contract schedule and cost
            boundaries, Seller shall submit in its documentation letter a
            ceiling price for the impact of the proposed change, or if requested
            by Buyer, a firm proposal or a Ceiling Rough-Order-of-Magnitude



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            Cost prepared in accordance with Section H.11 "Contract Change
            Proposals." Buyer is not obligated to pay for any proposed change
            until the contract is formally revised by Buyer's authorized
            Procurement Agent. Buyer is not obligated to initiate work for any
            proposed change made by Seller until such time as the contract
            parties execute a bilateral modification or Buyer's authorized
            Procurement Agent issues a unilateral contract modification pursuant
            to the Changes article of GP4 "The Boeing Company General Provisions
            (Cost Reimbursement Contract Under Government Prime Contract)".

      b.    Unilateral Contract Changes. In the event Buyer issues a unilateral
            contract modification pursuant to the Changes article of GP4 "The
            Boeing Company General Provisions (Cost Reimbursement Contract Under
            Government Prime Contract)", and the modification involves new work,
            Buyer's authorized Procurement Agent will advise Seller of the
            availability of additional funding for the new work, or if the
            additional funding is not available, advise Seller that new work
            must be accomplished within existing funding constraints. Further,
            in accordance with the Section H.9 "Equitable Adjustment," unless
            directed otherwise by Buyer's authorized Procurement Agent, Seller's
            equitable adjustment proposal prepared and submitted in response to
            a unilateral contract modification issued by Buyer's authorized

      c.    Procurement Agent will maintain the overall schedule and estimated
            cost and include recommendations of statement of work requirements
            to be modified, reduced, or deleted in order to perform within the
            existing contract schedule and cost boundaries.

      d.    Cost or Pricing Information in Support of Modifications. Although,
            Seller's cost or pricing information to support contract
            modifications will not require TINA certification, Seller shall
            prepare and submit contract modification change proposals to Buyer
            in adequate detail to comply with the following:

            (1) If the proposed price is controlled under law by periodic
                rulings, reviews, or similar actions of a governmental body,
                attach a copy of the controlling document to your proposal.

            (2) If the proposed price is for a commercial item, Seller shall
                provide, at a minimum, information on prices at which the same
                or similar items have previously been sold, leased or licensed
                or had been offered for sale, lease or license that is adequate
                for evaluating the reasonableness of the price of the
                modification. Such information may include:

                (a)  For catalog items, a copy of, or identification of the
                     catalog and its date, or the appropriate pages for the
                     proposed items, or a statement that the catalog is on file
                     in the buying office to which the proposal is being
                     submitted. Provide a copy or describe current discount
                     policies and price lists (published or unpublished), e.g.,
                     wholesale, original equipment manufacturer, or reseller.
                     Also explain the basis of each proposed price and its
                     relationship to the established catalog price, including
                     how the proposed price relates to the recent sales in
                     quantities similar to the proposed quantities.

                (b)  For market-priced items, the source and date or period of
                     the market quotation or other basis for market price, the
                     base amount, and applicable documents. In addition,
                     describe the nature of the market.

            (3) Seller grants Buyer's authorized Procurement Agent, or an
                authorized Government representative, the right to examine, at
                any time the books, records, documents, or other directly
                pertinent records to verify the reasonableness of price for (1)
                or (2) above. For items priced using catalog or market prices,
                or law or regulation, access does not extend to cost or profit
                information or other data relevant solely to Seller's
                determination of the prices to be proposed in the catalog or
                marketplace.



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                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

            (4) If neither (1) or (2) apply, then Seller shall submit data in
                accordance with Table 15-2 of FAR 15.408. This data shall not
                require TINA certification.

            (5) If requested by Buyer's authorized Procurement Agent, Seller
                shall submit one copy of its change proposal to the Government
                Administrative Contracting Officer and the cognizant DCAA
                auditor.

H.11  CONTRACT CHANGE PROPOSALS

      a.    If specific modifications to the contract statement of work are
            being considered (contemplated) by Buyer, and it is determined that
            such modifications are within the general scope of the contract, but
            may not be initiated or authorized by Buyer without a net cost
            increase and/or schedule change to the contract, Buyer's authorized
            Procurement Agent may request Seller to prepare and submit a change
            proposal for the contemplated modifications. Upon receipt of a
            written request from Buyer's authorized Procurement Agent and in
            accordance with the Procurement Agent's instructions, Seller shall
            prepare and submit a proposal for the contemplated contract change
            in compliance with one of the two types of cost proposals requested
            by Buyer, and described in this clause.

      b.    Reserved

      c.    Submission of Firm Cost Proposals. When requested by Buyer, Seller
            shall prepare the firm cost proposal in such form and substance as
            to represent a request for contract adjustment pursuant to Section
            H.10 "Modifications" and the "Changes" article of GP4 "The Boeing
            Company General Provisions (Cost Reimbursement Contract Under
            Government Prime Contract)"; and unless authorized by Buyer's
            authorized Procurement Agent, will normally be received prior to the
            issuance of Buyer's written authorization for Seller to proceed with
            the modified work incorporated by the change. If Buyer decides to
            authorize the change, the firm cost proposal shall be cited in
            Buyer's unilateral contract modification, and upon its issuance,
            shall be a binding part of the contract pending definitization of
            the Equitable Adjustment. This firm cost proposal is the maximum
            adjustment to be made in the total contract price; i.e., target
            cost, estimated cost, target fee or fixed fee, as appropriate for
            the type of contract; or in the delivery schedule (or time of
            performance) by reason of the change. In no event shall the
            definitive Equitable Adjustment exceed the limitations established
            with the exception of adjustments affected by rate changes which
            have been approved by the Government subsequent to the submittal
            date of the firm cost proposal. This exception applies provided that
            the original firm cost proposal submittal utilized Government
            approved rates. Firm cost proposals submitted by Seller which
            require modification because of redirection by Buyer's authorized
            Procurement Agent so that the original firm cost proposal submitted
            is no longer applicable, i.e., 10% or more change in value, may
            require the timely resubmission of a revised firm cost proposal.
            Otherwise, the parties will negotiate changes affecting the cost
            proposal during negotiations or as changes to the original proposal.

      d.    Submission of a Ceiling Rough-Order-of-Magnitude Cost Proposal. If
            time will not permit the submission of a firm cost proposal for the
            contemplated change, Buyer's authorized Procurement Agent may
            request Seller to submit a written "ceiling rough-order-of-magnitude
            (CROM)" amount for the contemplated change. Seller agrees that the
            CROM is the maximum adjustment to be made in the total contract
            price; i.e. target cost, estimated cost, target fee or fixed fee, as
            appropriate for the type of contract; or in the delivery schedule
            (or time of performance) by reason of the change, if Buyer
            authorizes the change. Buyer's authorized Procurement Agent may also
            solicit such agreement on CROM limitations for adjustments to any
            other provisions of the contract which may be subject to equitable
            adjustment by reason of the change. Any such written agreement shall
            be cited in the unilateral contract modification and, upon its
            issuance, shall be a binding part of the contract. In no event shall
            the definitive equitable adjustment exceed the limitations so
            established.



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      e.    Seller agrees that firm cost proposals submitted pursuant to this
            clause shall remain valid for a period of 120 days after submission
            and that CROMs submitted pursuant to this clause shall remain valid
            for a period of 90 days after submission. A change proposal accepted
            in accordance with the "Changes" article of GP4 "The Boeing Company
            General Provisions (Cost Reimbursement Contract Under Government
            Prime Contract)" shall not be considered an authorization to Seller
            to exceed the estimated cost (or authorized funding allotment) in
            the contract, unless the estimated cost is increased by the
            unilateral contract modification or bilateral contract modification.

H.12  MAKE/BUY AND DIRECTED PROCUREMENTS (PRIME FLOWDOWN)

      a.    Buyer reserves the right to participate in the development of
            Seller's Make/Buy Plan and in Seller's procurement source selection
            decisions and, if considered in the FCS program's interest, as
            determined solely by Buyer, may direct placement of Seller's
            subcontracts/purchase orders under this contract. Any such decision
            by Buyer that results in an increase to Seller's cost or schedule
            for performance will entitle Seller to an Equitable Adjustment as
            defined in Section H.9 "Equitable Adjustment." While Buyer will
            generally not interfere with Seller's internal processes, Buyer
            reserves the right to disapprove any Make/Buy decision and
            procurement source selection decision under Seller's processes
            regarding systems, subsystems or components.

      b.    In the event Buyer disagrees with a source selection made by Seller
            as a result of a competitive source selection, Buyer may direct the
            subcontract award. Also, if existing technologies, systems and major
            systems already in development by, or for the Government, represent
            in Buyer's or Government's view the best approach to achieving the
            objectives of the FCS program, Buyer's authorized Procurement Agent
            may direct their use and Seller will not be required to compete the
            item, i.e., competitive source selection is not required. Any
            decision by Buyer that requires Seller to use a directed
            subcontractor that results in an increase to Seller's cost or
            schedule for performance, will entitle Seller to an Equitable
            Adjustment as defined in Section H.9 "Equitable Adjustment."

H.13  ONE TEAM SHARED DESTINY

      a.    An essential feature of the FCS Program is the Army, DARPA, Industry
            "One Team" structure that emphasizes collaboration, partnership,
            teamwork and technical results in order to provide the Army with the
            desired capabilities to conduct full spectrum operations in the 21st
            century. In the spirit of this One Team approach, Seller agrees to
            the following:

            1.    Work cooperatively as a member of the "One Team" to identify
                  and resolve problems and facilitate contract performance.

            2.    Support the "One Team" idea of looking beyond the strict
                  bounds of the contract to formulate "One Team" actions that
                  promote a "shared destiny" of common goals and objectives.

            3.    Support and promote a relationship that is based upon open and
                  continuous communication, mutual trust and respect; to replace
                  the "us vs. them" mentality of the past with a "win-win"
                  philosophy for the future.

            4.    Support a One Team Council approach by implementing the
                  following:

                  i.    Attend and actively participate in One Team Council
                        meetings and support the Team's initiatives as required.
                        The One Team Council participants shall consist of
                        senior and executive management representatives from the
                        Army, DARPA, Boeing, SAIC and selected major/critical
                        FCS subcontractors.



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                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

                  ii.   Share, evaluate, and implement best practices and common
                        processes identified by the One Team Council as
                        beneficial to the FCS Program and its participants.

                  iii.  Participate in the identification and implementation of
                        efficiency improvement opportunities.

            5.    Create, administer, and status a Management Reserve (MR)
                  account equal to 7-10% of the contract's total estimated cost.
                  The MR account shall be used to support the Program Level
                  Change Management Process, as recommended by the One Team
                  Council and mutually established by the contract parties.

H.14  FIREWALL - COMPETITION SENSITIVE INFORMATION

      a.    General. Buyer has adopted a policy of controlling access to data
            that constitutes Competition Sensitive Information. Seller agrees to
            further this policy by complying with the provisions of this clause.

      b.    Definitions

            (1)   "Competition Sensitive FCS Information" (referred to as "CSI")
                  means information that Buyer or a Subcontractor IPT Leader has
                  determined would give a bidder in a Competitive Procurement a
                  significant unfair advantage over other bidders in that
                  Competitive Procurement, which Buyer or a Subcontractor IPT
                  Leader has marked, or caused to be marked, with a label
                  containing the phrase "Competition Sensitive FCS Information."

            (2)   "Competitive Procurement" means a procurement for the FCS
                  Program that Buyer or a Subcontractor IPT Leader intends to
                  conduct in the future, in which requests for procurement will
                  be issued to more than one potential supplier.

            (3)   "CSI Firewalled Employees" means individuals who are assigned
                  to perform work on this contract and who are allowed access to
                  CSI as described in paragraph c.

            (4)   "Subcontractor IPT Leader" means a subcontractor to Buyer
                  which will lead an IPT or is required by Buyer as part of its
                  subcontract from Buyer to conduct Competitive Procurements
                  under a firewall. At this time, these include General Dynamics
                  Land Systems and United Defense LP for Manned Ground Vehicles,
                  Raytheon Corporation, Network Centric Systems for Ground Based
                  Sensor Integration, Northrop Grumman Corporation, Electronic
                  Systems Division, for Air Based Sensor Integration

      c.    Access to CSI

            (1)   Documents containing CSI will be marked with a label that
                  includes the phrase "Competition Sensitive FCS Information."

            (2)   CSI for each IPT will be maintained exclusively in one or more
                  of the three following locations:

                  (a)   computer servers designated by Buyer with CSI protected
                        such that it is accessible only to CSI Firewalled
                        Employees working on that IPT;

                  (b)   rooms to which access is limited to CSI Firewalled
                        Employees working on that IPT during the time CSI is in
                        the room or otherwise disclosed; or

                  (c)   computer hard drives of CSI Firewalled Employees working
                        on that IPT.



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                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

            (3)   CSI can be shared and discussed only among persons who are CSI
                  Firewalled Employees for that IPT.

            (4)   Seller will advise Buyer as to which of Seller's employees and
                  those of its subcontractors should be designated as CSI
                  Firewalled Employees for each IPT on which Seller
                  participates.

            (5)   Seller will require its employees to refrain from sharing the
                  CSI with any person who is not a CSI Firewalled Employee for
                  that IPT.

            (6)   Each IPT will have a person assigned to it who is designated
                  as the IPT Firewall Focal (if Seller is a Subcontractor IPT
                  Leader, it will, if authorized by Buyer, appoint the IPT
                  Firewall Focal). The IPT Firewall Focal on each IPT will (a)
                  maintain the list of CSI Firewalled Employees within that IPT,
                  (b) determine which documents or information created by the
                  IPT should be designated as CSI, and assure that such
                  information is properly marked and controlled, (c) determine
                  when information previously designated as CSI should cease
                  being so treated, and (d) monitor compliance by IPT
                  participants with the requirements of this clause.

            (7)   Seller will require its employees to comply with direction of
                  the IPT Firewall Focal.

            (8)   Seller will, subject to the overriding requirements of this
                  clause, treat any CSI it receives as Proprietary Information
                  and Materials under article 24 of contract Clause GP-4 in
                  contract Section I hereunder.

      d.    Participation in Competitive Procurements. Seller will not use
            existing CSI in any Competitive Procurement. Seller will restrict
            its CSI Firewalled Employees from participating in preparation of
            any proposals to Buyer or to a Subcontractor IPT Leader (either
            directly or as a team member with another company) for a Competitive
            Procurement while such persons are CSI Firewalled Employees and for
            a period of one year from the time that Seller notifies Buyer that
            such person should be removed from the list of CSI Firewalled
            Employees. Buyer will waive this restriction upon application by
            Seller if Buyer determines that the categories of CSI to which
            Seller's CSI Firewall Employees had access is not germane to a
            particular Competitive Procurement or if the only applicable CSI has
            expired (no longer considered CSI).

      e.    Administration of Firewall

            (1)   Seller will establish a firewall procedure to assure that the
                  requirements of this clause will be met. Seller will provide
                  Buyer with a copy of this procedure upon request. Buyer's
                  approval of the firewall procedure is required if Seller is a
                  Subcontractor IPT Leader.

            (2)   Seller will maintain a list of its CSI Firewalled Employees.
                  Seller will record on this list the date that the employee
                  started work on the contract and the date that the employee
                  ceased performing contract work. Seller will make this record
                  available to Buyer on request.

            (3)   Seller will train its CSI Firewalled Employees on the
                  requirements of this clause, and will maintain records of the
                  date on which each employee was trained. Seller will make
                  these records available to Buyer on request.

            (4)   Seller will require its CSI Firewalled Employees to sign a
                  form substantially similar to the following form:

                  I acknowledge that I have been informed by my employer that:

                        (i) I am obligated to maintain information designated as
                        "Competition Sensitive FCS Information" as confidential
                        and only use such for carrying out my employer's FCS
                        Program purchase contracts.



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                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

                        (ii) I may not share Competition Sensitive FCS
                        Information with any person who has not signed a similar
                        acknowledgment form. I must maintain Competition
                        Sensitive FCS Information only on the restricted
                        computer server identified by Boeing, except that I may
                        download a document containing such information to my
                        hard drive temporarily when I am working on the
                        document, and I may maintain such documents in hard copy
                        if they are kept or brought in a room to which only
                        other CSI Firewalled Employees for my IPT have access.

                        (iii) I may not work on or support proposals by my
                        employer (or any other company) for FCS Program
                        subcontracts until I am informed by my employer that
                        such restriction has been ended.

                        (iv) My failure to comply with these rules could result
                        in disciplinary action up to and including suspension or
                        termination of my employment.

                  I understand these restrictions are imposed for the purpose of
                  assuring fair and equal subcontract competitions under the FCS
                  Program.

      f.    In the event that Seller becomes aware that any of its employees or
            those of its subcontractors have violated the conditions set forth
            in this clause, Seller agrees to notify Buyer of the violation
            within 72 hours after it is discovered and the proposed remedial
            actions.

      g.    Seller will flow this clause down to any of its subcontractors who
            will have a requirement to be given access to CSI.

H.15  FIREWALL - PROPOSAL EVALUATION - SUBCONTRACTOR IPT LEADER

      a.    General. Buyer has adopted a policy that employees of Buyer and
            Subcontractor IPT Leaders who conduct Competitive Procurements and
            will participate in review of proposals therefore must meet certain
            requirements in order to assure fairness in such reviews. Seller
            agrees to further this policy by complying with the provisions of
            this clause.

      b.    Definitions

            (1)   "Proposal Information" means information that Buyer has
                  received from bidders in a Competitive Procurement.

            (2)   "Competitive Procurement" means a procurement for the FCS
                  Program that Buyer or a Subcontractor IPT Leader intends to
                  conduct in the future, in which requests for procurement will
                  be issued to more than one potential supplier.

            (3)   "Evaluator" means employees of Seller who are assigned to
                  perform evaluation work for Competitive Procurements.

            (4)   "Proposal Evaluation" means any form of participation in
                  review of bids received as a result of a Competitive
                  Procurement.



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      c.    Restrictions on Evaluators. Seller agrees not to designate as an
            Evaluator any person who worked for organization within Seller that
            has prepared or is submitting a bid in a Competitive Procurement
            within the year preceding the commencement of the Proposal
            Evaluation of that Competitive Procurement. Seller will prevent its
            Evaluators from participating in preparation of any proposals for a
            Competitive Procurement relative to any IPT for which they were an
            Evaluator or had access to Proposal Information until one year after
            the Evaluator has ceased performance of Proposal Evaluation work, or
            had access to Proposal Information, whichever is longer, relative to
            said IPT.

      d.    Confidentiality of Procurement Information. Seller agrees to treat
            all Proposal Information as Proprietary Information in accordance
            with a standard proprietary information agreement with bidders
            (Buyer will provide as a model, which should be followed as closely
            as possible, the agreement it used with bidders for the SDD phase
            subcontracts). Seller agrees to require its Evaluators not to share
            any Competitive Proposal Information with any employee of Seller who
            is not an Evaluator.

      e.    Administration of Firewall

            (1)   Seller will establish a firewall procedure to assure that the
                  requirements of this clause will be met. Seller will provide
                  Buyer with a copy of this procedure for approval of Buyer upon
                  Buyer's request.

            (2)   Seller will train its Evaluators on the requirements of this
                  clause, and will maintain records of the date on which each
                  employee was trained. Seller will make these records available
                  to Buyer on request.

            (3)   Seller will maintain a list of its Evaluators. Seller will
                  record on this list the date that the employee started
                  evaluation work and the date that the employee ceased
                  performing evaluation work relative to each IPT and
                  Competitive Procurement. Seller will make this list available
                  to Buyer on request.

            (4)   Seller will require its Evaluators to sign a form
                  substantially similar to the following form:

                  (a)   I will assist Boeing and my employer in the evaluation
                        of proposals submitted by various companies for the
                        purpose of obtaining subcontracts to perform work on the
                        FCS Program.

                  (b)   Information in the proposals is confidential, may only
                        be used for evaluation of the proposals, and that I may
                        not share information related to these (or any other
                        proposals) with any person who has not signed a similar
                        acknowledgment form.

                  (c)   I may not work on proposals by my employer (or any other
                        company), for competitive FCS subcontracts for one year
                        following completion of the Proposal Evaluation for each
                        IPT I was an Evaluator (or for which I had access to
                        Competitive Proposal Information), unless I am informed
                        by my employer that such restriction has been ended
                        sooner.

                  (d)   My failure to comply with these rules could result in
                        disciplinary action up to and including suspension or
                        termination of my employment.

      f.    In the event that Seller becomes aware that any of its employees or
            those of its subcontractors have violated the conditions set forth
            in this clause, Seller agrees to notify Buyer of the violation
            within 72 hours after it is discovered and the proposed remedial
            actions.

      g.    Seller will flow this clause down to any of its subcontractors who
            will participate in Proposal Evaluations.



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H.16  EMPLOYMENT OF FORMER BUYER EMPLOYEES

      a.    Seller will not employ any person who is a former employee of Buyer
            to perform work under this contract or in preparation of proposals
            for future work on the FCS Program, unless that person has worked
            for Seller for at least one year prior to commencement of such work.

      b.    Buyer will waive this clause upon application by Seller if Buyer
            determines that the employment of such former Buyer employee would
            not violate any Buyer FCS Program directive.

      c.    Seller will flow this clause down to its subcontractors at all
            tiers.

H.17  AUTHORIZATION AND ADMINISTRATION OF CPFF LEVEL-OF-EFFORT (LOE) TASK ORDERS
      (CLIN 006 ONLY)

      a.    Task Order Proposal Preparation. When requested by Buyer's
            authorized Procurement Agent, Seller shall prepare and submit a task
            order proposal. The task order proposal shall contain a detailed
            technical description of the effort to be performed under the task
            order, the number of direct labor hours proposed for each direct
            labor category, and all Additional Other Direct Costs (AODCs) and
            its associated indirect costs proposed for the proposed task order.
            A "direct labor hour" is defined as a hour of labor performed (or
            estimated to be performed) by direct charge personnel and expended
            (or estimated to be expended) in accomplishing the task order. In
            preparing the task order proposal, and for purposes of establishing
            a proposed total estimated cost, FCCOM and fixed fee, Seller shall
            use the hourly rates and fee factors set forth in the attachment
            listed in Section J entitled "CPFF Task Order Rates and Supporting
            Information Requirements." Seller shall also provide to Buyer with
            each task order proposal the support information set forth in this
            attachment. Upon receipt/evaluation of the task order proposal,
            Buyer's authorized Procurement Agent may issue a bilateral task
            order to Seller for Seller's acceptance. The task order will be
            serially numbered, dated and signed by the Buyer's authorized
            Procurement Agent.

      b.    Estimated Task Order Costs/Calculations for Preparing Task Order
            Proposals. The estimated cost (fully-burdened with G&A, excluding
            FCCOM) of each task order shall be the sum of the following cost
            bases: labor cost, subcontract cost (if applicable) and ODC (if
            applicable). Seller's estimated labor cost (excluding FCCOM) shall
            be the sum of the estimated labor costs calculated for each proposed
            labor category. The estimated labor cost (excluding FCCOM) for each
            proposed labor category shall be determined by multiplying the
            estimated number of direct labor hours (in whole numbers only) by
            the respective loaded labor rate. The "loaded labor rate" is the
            hourly rate set forth in the Section J attachment entitled "CPFF
            Task Order Rates and Supporting Information Requirements." Seller's
            estimated FCCOM on Seller's labor cost shall be the sum of the
            estimated FCCOM costs calculated for each proposed labor category.
            The estimated FCCOM for each proposed labor category shall be
            determined by multiplying the estimated number of direct labor hours
            (in whole numbers) by the respective FCCOM hourly rate set forth in
            the Section J attachment entitled "CPFF Task Order Rates and
            Supporting Information Requirements." The estimated fixed fee of
            each task order shall be the sum of the fixed fees calculated for
            each proposed cost base (labor, subcontracts and ODC). The fixed fee
            calculated for each proposed cost base shall be determined by
            multiplying the estimated cost (excluding FCCOM) by the respective
            fee rate set forth in the Section J attachment entitled "CPFF Task
            Order Rates and Supporting Information Requirements."



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      c.    Task Order Issuance. Each Buyer-issued task order will specify the
            following elements: (1) a description of the effort to be performed
            (Statement of Work (SOW)). The LOE task order SOW will describe the
            required work scope in general terms only; (2) a specified
            level-of-effort (LOE). The specified LOE will indicate the MINIMUM
            quantity of total direct labor hours to be expended by Seller, the
            direct labor categories to be utilized in performing the task order
            and other LOE definition, as applicable; (3) a task order period of
            performance (stated time period) specifying beginning and ending
            dates that Seller shall devote the specified LOE; (4) estimated
            costs, including AODC plus its associated indirect costs, FCCOM and
            fixed fee for the task order; the estimated cost (fully-burdened
            with G&A) will breakout total labor cost, subcontract cost (if
            applicable) and ODC (if applicable); fixed fee and FCCOM will be
            broken out by its respective cost base, (e.g., labor, subcontracts,
            ODC); (5) SDRL Item(s) or other deliverable data; (6) a statement
            that the task order is either fully-funded or incrementally-funded;
            if incrementally funded, the task order will include the allotted
            funding and estimated funding expiration date; and (7) any
            applicable Cost Account (CA) and/or Cost Charge Numbers (CCN).

      d.    Task Order Acceptance. Within ten (10) calendar days of receipt of
            the task order, Seller shall submit a written notice of task order
            acceptance. Seller's written notice may be in the form of an e-
            mail, fax, or other appropriate means of written correspondence.
            Each task order and amendment thereto accepted by the Seller shall
            be deemed to be incorporated into this contract by reference.
            Failure of the Seller to provide written acceptance of the task
            order to the Buyer's authorized Procurement Agent shall be
            considered Seller's non-acceptance of the task order.

      e.    Task Order Performance. Seller's acceptance of a task order
            obligates it to devote the specified level of effort for the stated
            period of time set forth by the task order subject to the provisions
            of the "Limitation of Cost" or "Limitation of Funds" clause, as
            applicable to the task order. Seller agrees to diligently perform
            the specified LOE and provide all required reports and other
            required deliverables within the stated period of performance and
            estimated cost of each task order. The Seller shall continually
            evaluate the specified LOE and recommend to the Buyer any changes
            which are beneficial in attaining the overall objectives of the task
            order. In expending the specified LOE, the Seller shall promptly
            notify the Buyer's authorized Procurement Agent, in writing, when
            there is an indication of premature exhaustion, or under-expenditure
            of specified LOE before the period of performance end-date
            (expiration date) of the task order.

      f.    Trading Hours and Costs Between Direct Labor Cost Bases. Within the
            specified LOE limitations of the task order as applicable, during
            task order performance, the Seller may trade direct labor hours
            between specified direct labor categories to better achieve the task
            order objectives provided the minimum quantity of specified LOE
            hours are furnished and the total task order CPFF is not exceeded.
            The Seller shall promptly notify the Buyer's authorized Procurement
            Agent, in writing, when there is an indication of LOE cost underrun
            as a result of utilizing a cheaper labor mix than originally
            estimated. Upon such notification from the Seller, the Buyer may
            unilaterally direct the Seller to utilize a richer labor mix
            provided the task order CPFF is not exceeded.

      g.    Under-Expended ODC, Material/Subcontract Costs. The Seller shall
            promptly notify the Buyer's authorized Procurement Agent, in
            writing, when there is an indication of under-expended (an underrun
            of) specified ODC, material and subcontract costs. Upon such
            notification from the Seller, the Buyer may unilaterally direct the
            Seller to convert under-expended ODC/subcontract/material costs to
            specified LOE costs by decreasing the specified task order
            ODC/subcontract/material costs and adding specified LOE hours/costs
            such that the net change does not increase the task order CPFF.

      h.    Specified LOE Hours Shortfall. If the Seller cannot expend the
            specified LOE (minimum quantity of direct labor hours) required by
            the authorized task order without exceeding the estimated cost
            (e.g., Seller spends a richer labor mix than originally estimated),
            it shall submit a written cost overrun proposal to the Buyer's
            authorized Procurement Agent. The Seller shall not exceed the
            estimated cost established in the authorized task order unless it
            receives written notification increasing this estimated cost from
            the Buyer's authorized Procurement Agent. Any such increase in the
            estimated cost of the task order shall be considered a cost overrun
            and the fee for authorized task order shall not be changed as a
            result thereof.



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                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

      i.    Accelerated Performance/Early Completion. In the performance of the
            task order, Seller shall control fluctuations in expended LOE to
            avoid early exhaustion of specified effort and associated estimated
            cost before the specified period of performance end-date (expiration
            date) of the task order. Seller may however, submit a written
            request for acceleration of expenditure of LOE before the expiration
            date of the task order. If such request is approved by the Buyer's
            authorized Procurement Agent, the accelerated performance resulting
            in a revised task order expiration date shall be without increase in
            fee and the revised expiration date shall be formalized by task
            order amendment. Seller shall not prematurely expend task order LOE
            before the task order expiration date or incur task order expenses
            after the specified, period of performance end-date (expiration
            date) of the task order unless authorized in writing by the Buyer's
            authorized Procurement Agent.

      j.    Recording of Each Task Order in Sections B and J. All definitive
            task order values (latest amended values only) shall be recorded in
            the table set forth in Section B for the CPFF task order CLIN. This
            "task order value" is the task order estimated cost, FCCOM and CPFF.
            In addition, each definitive task order number, task order amendment
            number and corresponding effectively date of the task order shall be
            listed in contract Section J.

      k.    Task Order Funding. No task order shall be issued under this clause
            until sufficient funds are allotted to cover the work. Incremental
            funding of task order(s) shall be governed by provisions of the
            "Limitation of Funds" clause. The Limitation of Cost Clause (or
            Limitation of Funds Clause if the task order is incrementally
            funded) shall apply to each task order and not the accumulative
            costs (or funding) of each task order issued under this clause.

      l.    Final Technical Report. Seller agrees to set aside a sufficient
            amount of funds from each task order to prepare and submit to Buyer
            a comprehensive final technical report (minimum of 500 words) at the
            end of the task order period of performance. If the Seller fails to
            set aside these funds and expends all the estimated costs provided
            by the task order before delivering the final technical report, the
            Seller agrees to provide this report at no additional cost to Buyer.
            If no final report is specified for a given task order, then this
            requirement is self-deleting for that task order.

      m.    No Obligation to Issue Task Order. Buyer is not obligated to issue
            any task orders under this clause. The number and total dollar value
            of each task order issued under this clause is unlimited provided
            the SOW for each task order is within the general work scope of the
            "Task Order" clause defined in Section C.

      n.    Contract/Task Order Period-of-Performance. In no event shall the
            period of performance of any task order extend beyond the overall
            period of performance of the CPFF task order CLIN specified in
            Section F.

      o.    Unilateral Task Order Changes. Buyer is authorized to unilaterally
            change the SOW, period of performance or specified LOE of any
            authorized task order. As a result of issuing any such unilateral
            change by the Buyer's authorized Procurement Agent, the task order
            shall be subject to equitable adjustment pursuant to the provisions
            of the Change Order Clause. Any such equitable adjustment in task
            order CPFF shall utilize the fee rate(s) set forth in the Section J
            attachment entitled "CPFF Task Order Rates and Supporting
            Information Requirements."

      p.    Task Order Payment. Buyer shall pay Seller its reimbursable costs
            pursuant to the "Allowable Cost and Payment" clause, and the task
            order fixed fee in accordance with the Section H clause entitled
            "CPFF Task Order Acceptance - Certification of Utilization of
            Hours," and the Section H clause entitled "Payment of Fixed Fee -
            CPFF Task Orders (LOE)."

      q.    Financial Reporting. Seller shall report cost account data to Buyer
            for each task order in accordance with the financial reporting
            requirements specified elsewhere in this contract.



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               INTERNATIONAL CORPORATION
               An Employee-Owned Company          PAGE 41 OF 48, REV. A (SA-002)
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H.18  CPFF TASK ORDER ACCEPTANCE - CERTIFICATION OF UTILIZATION OF HOURS (CLIN
      0006 ONLY)

      a.    Upon expiration of the task order, the Seller shall submit a
            "Certificate of Utilization of Hours" indicating that it has
            expended all hours (specified LOE) required by the task order. This
            certification shall be signed and dated by an individual who is
            authorized to commit the Seller. The Buyer shall have the right to
            examine the Seller's records for the purpose of verifying the number
            of utilized direct labor hours

      b.    The Certification referred to above shall be submitted in
            essentially the following format:

                       CERTIFICATE OF UTILIZATION OF HOURS

                  I HEREBY CERTIFY THAT (Seller's name) UTILIZED A TOTAL OF
                  ____ DIRECT LABOR HOURS CONSISTING OF THE SELLER'S LABOR
                  CATEGORIES AND CONTRACT EFFORT SET FORTH IN TASK ORDER
                  NO.______________________________ ISSUED UNDER CONTRACT
                  NO.______________________.

                        Date of Execution: _____________________________________
                        Signature: _____________________________________________
                        Typed Name & Title: ____________________________________

      c.    Within thirty (30) days after receipt of the "Certificate of
            Utilization of Hours" the Buyer shall indicate its acceptance or
            non-acceptance of this certificate and the task order effort.

H.19  AUTHORIZATION AND ADMINISTRATION OF CPFF COMPLETION TASK ORDERS (CLIN 0006
      ONLY)

      a.    Task Order Proposal Preparation. When requested by Buyer's
            authorized Procurement Agent, Seller shall prepare and submit a task
            order proposal. The task order proposal shall contain a detailed
            technical description of the effort to be performed under the task
            order, the number of direct labor hours proposed for each direct
            labor category, and all Additional Other Direct Costs (AODCs) and
            its associated indirect costs proposed for the proposed task order.
            A "direct labor hour" is defined as a hour of labor performed (or
            estimated to be performed) by direct charge personnel and expended
            (or estimated to be expended) in accomplishing the task order. In
            preparing the task order proposal, and for purposes of establishing
            a proposed total estimated cost, FCCOM and fixed fee, Seller shall
            use the hourly rates and fee factors set forth in the attachment
            listed in Section J entitled "CPFF Task Order Rates and Supporting
            Information Requirements." Seller shall also provide to Buyer with
            each task order proposal the support information set forth in this
            attachment. Upon receipt/evaluation of the task order proposal,
            Buyer's authorized Procurement Agent may issue a bilateral task
            order to Seller for Seller's acceptance. The task order will be
            serially numbered, dated and signed by the Buyer's authorized
            Procurement Agent.

      b.    Estimated Task Order Costs/Calculations for Preparing Task Order
            Proposals. The estimated cost (fully-burdened with G&A, excluding
            FCCOM) of each task order shall be the sum of the following cost
            bases: labor cost, subcontract cost (if applicable) and ODC (if
            applicable). Seller's estimated labor cost (excluding FCCOM) shall
            be the sum of the estimated labor costs calculated for each proposed
            labor category. The estimated labor cost (excluding FCCOM) for each
            proposed labor category shall be determined by multiplying the
            estimated number of direct labor hours (in whole numbers only) by
            the respective loaded labor rate. The "loaded labor rate" is the
            hourly rate set forth in the Section J attachment entitled "CPFF
            Task Order Rates and Supporting Information Requirements." Seller's
            estimated FCCOM on Seller's labor cost shall be the sum of the
            estimated FCCOM costs calculated for each proposed labor category.
            The estimated FCCOM for each proposed labor category shall be
            determined by multiplying the estimated number of direct labor hours
            (in whole numbers) by the respective FCCOM hourly rate set forth in
            the Section J attachment entitled "CPFF Task Order Rates and
            Supporting Information Requirements." The estimated fixed fee of
            each task order shall be the sum of the fixed fees calculated for
            each proposed cost base (labor, subcontracts and ODC). The fixed fee
            calculated for each proposed cost base shall be determined by
            multiplying the estimated cost (excluding FCCOM) by the respective
            fee rate set forth in the Section J attachment entitled "CPFF Task
            Order Rates and Supporting Information Requirements."



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[SAIC (R) LOGO] SCIENCE APPLICATIONS
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                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647

      c.    Task Order Issuance. Each Buyer-issued task order will specify the
            following elements: (1) a description of the effort to be performed
            (Statement of Work (SOW)). The Completion-type task order SOW will
            describe the required work scope by stating a definite goal or
            target and by specifying an end-product; (2) a milestone schedule
            and/or delivery schedule; (3) a task order period of performance
            (stated time period) specifying beginning and ending dates that
            Seller shall perform and complete the task order; (4) estimated
            costs, including AODC plus its associated indirect costs, FCCOM and
            fixed fee for the task order; the estimated cost (fully-burdened
            with G&A) will breakout total labor cost, subcontract cost (if
            applicable) and ODC (if applicable); fixed fee and FCCOM will be
            broken out by its respective cost base, (e.g., labor, subcontracts,
            ODC); (5) SDRL Item(s), if applicable; (6) a statement that the task
            order is either fully-funded or incrementally-funded; if
            incrementally funded, the task order will include the allotted
            funding and estimated funding expiration date; and (7) any
            applicable Cost Account (CA) and/or Cost Charge Numbers (CCN).

      d.    Task Order Acceptance. Within ten (10) calendar days of receipt of
            the task order, Seller shall submit a written notice of task order
            acceptance. Seller's written notice may be in the form of an e-mail,
            fax, or other appropriate means of written correspondence. Each task
            order and amendment thereto accepted by the Seller shall be deemed
            to be incorporated into this contract by reference. Failure of the
            Seller to provide written acceptance of the task order to the
            Buyer's authorized Procurement Agent shall be considered Seller's
            non-acceptance of the task order.

      e.    Task Order Performance. Seller's acceptance of a task order
            obligates it to complete all the effort set forth by the task order
            subject to the provisions of the "Limitation of Cost" or "Limitation
            of Funds" clause, as applicable to the task order.

      f.    Under-Expended ODC, Material/Subcontract Costs. The Seller shall
            promptly notify the Buyer's authorized Procurement Agent, in
            writing, when there is an indication of under-expended (an underrun
            of) specified ODC, material and subcontract costs. Upon such
            notification from the Seller, the Buyer may unilaterally direct the
            Seller to convert under-expended ODC/subcontract/material costs to
            additional work tasks by decreasing the specified task order
            ODC/subcontract/material costs and adding work tasks and associated
            additional costs such that the net change does not increase the task
            order CPFF.

      g.    Unable to Complete Work. If the Seller cannot complete the definite
            work goals, targets and/or deliverables required by the authorized
            task order without exceeding the estimated cost, it shall submit a
            written cost overrun proposal to the Buyer's authorized Procurement
            Agent that successfully completes the task order. The Seller shall
            not exceed the estimated cost established in the authorized task
            order unless it receives written notification increasing this
            estimated cost from the Buyer's authorized Procurement Agent. Any
            such increase in the estimated cost of the task order shall be
            considered a cost overrun and the fee for authorized task order
            shall not be changed as a result thereof.

      h.    Accelerated Performance/Early Completion. In the performance of the
            task order, Seller shall coordinate with Buyer any accelerated
            performance or early deliveries.

      i.    Recording of Each Task Order in Sections B and J. All definitive
            task order values (latest amended values only) shall be recorded in
            the table set forth in Section B for the CPFF task order CLIN. This
            "task order value" is the task order estimated cost, FCCOM and CPFF.
            In addition, each definitive task order number, task order amendment
            number and corresponding effectively date of the task order shall be
            listed in contract Section J.

      j.    Task Order Funding. No task order shall be issued under this clause
            until sufficient funds are allotted to cover the work. Incremental
            funding of task order(s) shall be governed by provisions of the
            "Limitation of Funds" clause. The Limitation of Cost Clause (or
            Limitation of Funds Clause if the task order is incrementally
            funded) shall apply to each task order and not the accumulative
            costs (or funding) of each task order issued under this clause.

      k.    No Obligation to Issue Task Order. Buyer is not obligated to issue
            any task orders under this clause. The number and total dollar value
            of each task order issued under this clause is unlimited provided



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                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 43 OF 48, REV. A (SA-002)
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            the SOW for each task order is within the general work scope of the
            "Task Order" clause defined in Section C.

      c.    Contract/Task Order Period-of-Performance. In no event shall the
            period of performance of any task order extend beyond the overall
            period of performance of the CPFF task order CLIN specified in
            Section F.

      d.    Unilateral Task Order Changes. Buyer is authorized to unilaterally
            change the SOW including goals/targets, period of performance, or
            delivery/performance schedule of any authorized task order. As a
            result of issuing any such unilateral change by the Buyer's
            authorized Procurement Agent, the task order shall be subject to
            equitable adjustment pursuant to the provisions of the Change Order
            Clause. Any such equitable adjustment in task order CPFF shall
            utilize the fee rate(s) set forth in the Section J attachment
            entitled "CPFF Task Order Rates and Supporting Information
            Requirements."

      e.    Task Order Payment. Buyer shall pay Seller its reimbursable costs
            pursuant to the "Allowable Cost and Payment" clause, and the task
            order fixed fee in accordance with the Section H clause entitled
            "CPFF Task Order Acceptance -- Certification of Completion," and the
            Section H clause entitled "Payment of Fixed Fee - CPFF Task Orders
            (Completion)."

      f.    Financial Reporting. Seller shall report cost account data to Buyer
            for each task order in accordance with the financial reporting
            requirements specified elsewhere in this contract.

H.20  CPFF TASK ORDER ACCEPTANCE - CERTIFICATION OF COMPLETION (CLIN 0006 ONLY)

      a.    Upon completion of the authorized task order, the Seller shall
            submit a "Certificate of Completion" indicating that it has
            successfully completed the stated goals, targets and end-product
            deliveries of the Statement of Work required by the task order. This
            certification shall be signed and dated by an individual who is
            authorized to commit the Seller.

      b.    The Certification referred to above shall be submitted in
            essentially the following format:

                            CERTIFICATE OF COMPLETION

                  I HEREBY CERTIFY THAT (Seller's name) COMPLETED ALL THE
                  REQUIREMENTS SET FORTH IN TASK ORDER
                  NO.____________________________ ISSUED UNDER CONTRACT
                  NO.______________________. I FURTHER CERTIFY THAT THE GOODS
                  AND/OR SERVICES ARE THE QUALITY SPECIFIED AND ARE IN ALL
                  RESPECTS IN COMPLIANCE WITH THE CONTRACT REQUIREMENTS,
                  INCLUDING SPECIFICATIONS AND/OR DRAWINGS, PACKAGING, PACKING
                  AND MARKING REQUIREMENTS AND IN THE QUALITY REQUIRED BY THE
                  CONTRACT.

                        Date of Execution: _____________________________________
                        Signature: _____________________________________________
                        Typed Name & Title: ____________________________________

      d.    Within thirty (30) days after receipt of the "Certificate of
            Completion" the Buyer shall indicate its acceptance or
            non-acceptance of this certificate and the task order effort.

H.21  LOWER TIER SUBCONTRACTING

      a.    The Seller shall identify Lower Tier Subcontracts or Purchase Orders
            issued to other consolidated business units of SAIC. SAIC
            consolidated business units are identified by the following names
            (DBA) and federal tax identification numbers:

            1.    Science Applications International Corporation (SAIC) Tax ID -
                  95-3630868

            2.    Hicks and Associates Tax ID- 54-1394778

            3.    Telecordia Technologies, Inc. Tax ID- 22-2478398



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                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 44 OF 48, REV. A (SA-002)
                                                                (APRIL 30, 2004)

      b.    Seller shall furnish to the Buyer the following information upon
            issuance of a subcontract or purchase order or modification of the
            same:

                1.    Subcontractor Issuing Subcontract or Purchase Order to
                      SAIC:

                2.    Subcontract/Purchase Order number Issued to SAIC and
                      Value:

                3.    SAIC Contact Name/Phone #:

      c.    The Seller shall ensure the flow down of this provision to all lower
            tier subcontractors. Each lower tier Subcontractor is required to
            submit this information to the next level for consolidation.

H.22  ASSIGNMENT PROVISION

      a.    Notwithstanding any other provisions herein, Boeing reserves the
            unilateral right to direct SAIC to assign to Boeing any or all of
            SAIC's subcontract with iRobot related to the Small Unmanned Ground
            Vehicle (SUGV). SAIC and iRobot hereby irrevocably waives any
            objection to such assignment, and agrees to promptly cooperate with
            Boeing to effect an assignment upon receipt of such direction from
            Boeing. SAIC and iRobot hereby agree that in the event Boeing
            directs such assignment to occur, all of iRobot's rights,
            obligations and duties under the assignment shall be for and/or
            inure to the benefit of Boeing. iRobot's sole recourse with respect
            to any such rights, duties and obligations shall be to Boeing, and
            SAIC thereafter shall have no responsibility or liability whatsoever
            arising under or relating to such assignment.

H.23  SPECIAL TERMINATION LIABILITY

      a.    "SPECIAL TERMINATION COSTS," AS USED IN THIS CLAUSE, MEANS ONLY
            COSTS IN THE FOLLOWING CATEGORIES:

        (1) SEVERANCE PAY:

            (A)   SEVERANCE PAY, ALSO COMMONLY REFERRED TO AS DISMISSAL WAGES,
                  IS A PAYMENT IN ADDITION TO REGULAR SALARIES AND WAGES BY
                  CONTRACTORS TO WORKERS WHOSE EMPLOYMENT IS BEING INVOLUNTARILY
                  TERMINATED. PAYMENTS FOR EARLY RETIREMENT INCENTIVE PLANS ARE
                  NOT COVERED IN THIS CLAUSE.

            (B)   SEVERANCE PAY TO BE ALLOWABLE MUST MEET THE GENERAL
                  ALLOWABILITY CRITERIA IN PARAGRAPH (i) OF THIS SUBSECTION,
                  AND, DEPENDING UPON WHETHER THE SEVERANCE IS NORMAL OR
                  ABNORMAL, CRITERIA IN PARAGRAPH (ii) FOR NORMAL SEVERANCE PAY
                  OR PARAGRAPH (iii) FOR ABNORMAL SEVERANCE PAY ALSO APPLY. IN
                  ADDITION, PARAGRAPH (ii) OF THIS SUBSECTION APPLIES IF THE
                  SEVERANCE COST IS FOR FOREIGN NATIONALS EMPLOYED OUTSIDE THE
                  UNITED STATES.

                  (i)   SEVERANCE PAY IS ALLOWABLE ONLY TO THE EXTENT THAT, IN
                        EACH CASE, IT IS REQUIRED BY

                        (aa)LAW;

                        (bb)EMPLOYER-EMPLOYEE AGREEMENT;

                        (cc)ESTABLISHED POLICY THAT CONSTITUTES, IN EFFECT,
                            AN IMPLIED AGREEMENT ON SELLER'S PART; OR

                        (dd)CIRCUMSTANCES OF THE PARTICULAR EMPLOYMENT

                        PAYMENTS MADE IN THE EVENT OF EMPLOYMENT WITH A
                        REPLACEMENT CONTRACTOR WHERE CONTINUITY OF EMPLOYMENT
                        WITH CREDIT FOR PRIOR LENGTH OF SERVICE IS PRESERVED
                        UNDER SUBSTANTIALLY EQUAL CONDITIONS OF EMPLOYMENT, OR
                        CONTINUED EMPLOYMENT BY SELLER AT ANOTHER FACILITY,
                        SUBSIDIARY, AFFILIATE, OR PARENT COMPANY OF SELLER ARE
                        NOT SEVERANCE PAY AND ARE UNALLOWABLE.

                  (ii)  ACTUAL NORMAL TURNOVER SEVERANCE PAYMENTS SHALL BE
                        ALLOCATED TO ALL WORK PERFORMED IN SELLER'S PLANT, OR IF
                        SELLER PROVIDES FOR ACCRUAL OF PAY FOR NORMAL
                        SEVERANCES, THAT METHOD WILL BE ACCEPTABLE IF THE AMOUNT
                        OF THE ACCRUAL IS REASONABLE IN LIGHT OF PAYMENTS
                        ACTUALLY MADE FOR NORMAL SEVERANCES OVER A
                        REPRESENTATIVE PAST PERIOD AND IF AMOUNTS ACCRUED ARE
                        ALLOCATED TO ALL WORK PERFORMED IN SELLER'S PLANT.



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                INTERNATIONAL CORPORATION
                An Employee-Owned Company       PAGE 44 A OF 48, REV. B (SA-006)
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                  (iii) Abnormal or mass severance pay is of such a conjectural
                        nature that measurement of costs by means of an accrual
                        will not achieve equity to Buyer and Seller. Thus,
                        accruals for this purpose are not allowable. However,
                        Buyer recognizes its obligation to participate, to the
                        extent of its fair share, in any specific payment. Thus,
                        allowability will be considered on a case-by-case basis.

            (2)   "Reasonable costs continuing after termination" - Despite all
                  reasonable efforts by Seller, costs that cannot be
                  discontinued immediately after the effective date of
                  termination are generally allowable. However, any costs
                  continuing after the effective date of the termination due to
                  the negligent or willful failure of Seller to discontinue the
                  costs shall be unallowable.

            (3)   "Settlement of expenses" - Settlement expenses, including the
                  following, are generally allowable:

                  (A)   Accounting, legal, clerical, and similar costs
                        reasonably necessary for

                        (i)   The preparation and presentation, including
                              supporting data, of settlement claims to Buyer;
                              and

                        (ii)  The termination and settlement of subcontracts

                  (B)   Reasonable costs for the storage, transportation,
                        protection, and disposition of property acquired or
                        produced for this contract.

                  (C)   Indirect costs related to salary and wages incurred as
                        settlement expenses in paragraphs (A) and (B); normally,
                        such indirect costs shall be limited to payroll taxes,
                        fringe benefits, occupancy costs, and immediate
                        supervision costs. If settlement expenses are
                        significant, a cost account or work order shall be
                        established to separately identify and accumulate them.

            (4)   Costs in paragraphs, a (1), (2), and (3) of this clause to
                  which subcontractors may be entitled in the event of
                  termination.

      b.    Notwithstanding the Limitation of Cost/Limitation of Funds article
            of this contract, Seller shall not include in its estimate of costs
            incurred or to be incurred any amount for special termination costs
            to which Seller may be entitled in the event this contract is
            terminated.

      c.    Seller agrees to perform this contract in such a manner that
            Seller's claim for special termination costs will not exceed the
            amounts specified below:



Army Fiscal Year*:
 ($ in millions)                  2004       2005         2006         2007        2008
- -----------------------------   ---------  ----------   ----------   ----------  ----------
                                                                  
Special Termination Liability:  $ 400,000  $1,250,000   $1,500,000   $1,425,000  $1,050,000




Army Fiscal Year*:
 ($ in millions)                  2009      2010      2011      2012      2013
- ------------------------------  --------  --------  --------  --------  -------
                                                         
Special Termination Liability:  $775,000  $525,000  $545,000  $425,000  $50,000


(*) Army Fiscal Year is October 1 through September 30.

      d.    Buyer shall have no obligation to pay Seller any amount for special
            termination costs in excess of these amounts. Periodic negotiations
            and adjustments of these amounts reserved for special termination
            costs will be accomplished as requested by Buyer.

      e.    In the event of termination, this clause shall not be construed as
            affecting the allow-ability of special termination costs in any
            manner other than limiting the maximum amount of the costs payable
            by Buyer.

      e.    This clause shall remain in full force and effect until this
            contract, excluding task orders, is fully funded.

                                END OF SECTION H



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 45 OF 48, REV. A (SA-004)
                                                            (SEPTEMBER 02, 2004)

The following are the General Provisions of this contract.

I.1   IDS COMMON TERMS AND CONDITIONS GUIDE

      a.    All reference within the following Terms and Conditions to The
            Boeing Company or Buyer, shall be considered as SAIC for the purpose
            of this subcontract only and in no way sets a precedence for any
            other subcontracts Seller may currently have or enter into in the
            future with The Boeing Company or SAIC.

      b.    The following contract clauses are incorporated by reference from
            the IDS Common Terms and Conditions Guide and apply to the extent
            indicated. These contract clauses can be accessed on the Internet
            via the following pathway:

            Enter: "http://www.boeing.com/companyoffices/doingbiz/sccommon/flash
                   .html"

            Select: "terms and conditions", then the applicable "Section" to
                    view the clause


Clause                                Title                                       Date
- ------                                -----                                       ----
                                                                          
GP4      The Boeing Company, General Provisions (Cost
         Reimbursement Contract Under Government Prime Contract) GP4             5/01/02

2003     Reporting of Discrepancies in Buyer Drawings                           10/15/02

2005     Technical Direction (R&D)                                              10/15/02

2006     Right to Use Technical Information                                     10/15/02

2011     Surveillance and Written Technical Direction                           10/15/02

3003     Seller Compliance with Occupational Safety & Health
         Act of 1970                                                            10/15/02

3006     Audit Rights                                                           10/15/02

3008     Buyer Audit Rights for Option Pricing of Follow-on Contracts           10/15/02

3009     Government - Furnished Property (GFP)                                  10/15/02

3010     Use of Government Production and Research Property
         (Industrial Facilities, Special Tooling, and Special Test Equipment)   10/15/02

3011     Limitation of Buyer's Obligation                                       10/15/02

3024     Special Tooling                                                        10/15/02

3028     Rent-Free Use of Government Facilities Not Authorized                  10/15/02

3032     Special Test Equipment - Title                                         10/15/02

3042     Buyer Furnished Property                                               10/15/02

3049     Prime Contract Flowdown Provisions                                     10/15/02

3068     Government Property Control                                            05/06/04




                                                                   Page 46 OF 48

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company   PURCHASE CONTRACT NUMBER: 4400078647


                                                            
4004     Additional General Provisions (Labor Hour/Time and
         Material Contract, Cost Reimbursement Contract Under
         Government Contract, Contract Labor)                     10/15/02

5068     DAAE07-03-9-F001 Future Combat Systems (FCS) System
         Development and Demonstration (SDD) Agreement            7/15/03


      c.    Changes/Clarifications. The following changes and clarifications
            apply to the clauses listed in above Section I.1a:

            (1)   Clause 2005. The Technical Representative referenced by this
                  clause is named in Section G.9

            (2)   Clause GP4 and the following Article(s):

                  a.    Article 24 is deleted in its entirety and replaced with
                        the following:

                  24. CONFIDENTAL, PROPRIETARY, AND TRADE SECRET INFORMATION AND
                  ITEMS. Buyer and Seller shall each keep confidential and
                  protect from unauthorized use and disclosure all (a)
                  confidential, proprietary and/or trade secret information; (b)
                  tangible items and software containing, conveying or embodying
                  such information; and (c) tooling identified as being subject
                  to this article and obtained, directly or indirectly, from the
                  other in connection with this contract or other agreement
                  referencing this contract (collectively referred to as a
                  "Proprietary Information and Materials"). Buyer and Seller
                  shall each use Proprietary Information and Materials of the
                  other only in the performance of and for the purpose of this
                  contract and/or any other agreement referencing this contract.
                  However, despite any other obligations or restrictions imposed
                  by this article, Buyer shall have the right to use, disclose
                  and reproduce Seller's Proprietary Information and Materials,
                  and make derivative works thereof, for the purposes of
                  testing, certification, use, sale or support of any goods
                  delivered under this contract or any other agreement
                  referencing this contract. Any such use, disclosure,
                  reproduction or derivative work by Buyer shall, whenever
                  appropriate, include a restrictive legend suitable to the
                  particular circumstances. The restrictions on disclosure or
                  use of Proprietary Information and Materials by Seller shall
                  apply to all materials derived by Seller or others from
                  Proprietary Information and Materials provided by Buyer. Upon
                  Buyer's request at any time, and in any event upon the
                  completion, termination or cancellation of this contract,
                  Seller shall return to Buyer all of Buyer's Proprietary
                  Information and Materials and all materials derived there
                  from, unless specifically directed otherwise in writing by
                  Buyer. Seller shall not, without the prior written
                  authorization of Buyer, sell or otherwise dispose of (as scrap
                  or otherwise) any parts or other materials containing,
                  conveying, embodying or made in accordance with or by
                  reference to any Proprietary Information and Materials of
                  Buyer. Prior to disposing of such parts or other materials as
                  scrap, Seller shall render them unusable. Buyer shall have the
                  right to audit Seller's compliance with this article. Seller
                  may disclose Proprietary Information and Materials of Buyer to
                  its subcontractors as required for the performance of this
                  contract, provided that each such subcontractor first agrees
                  in writing to the same obligations imposed upon Seller under
                  this article relating to Proprietary Information and
                  Materials. Seller shall be liable to Buyer for any breach of
                  such obligation by such subcontractor. The provisions of this
                  article are effective in lieu of any restrictive legends or
                  notices applied to Proprietary Information and Materials. The
                  provisions of this article shall survive the performance,
                  completion, termination or cancellation of this contract.



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company         PAGE 47 OF 48, REV. A (SA-004)
                                                            (SEPTEMBER 02, 2004)

            (1)   Clause 5068.

                     a.    Paragraph (a)(10)52.227-12 Patent Rights is deleted
                           in its entirety:

                           (a)(10) 52.227-12 Patent Rights - Retention by the
                           Contractor (Long Form) (JAN 1997). This clause
                           applies only if this contract is for experimental,
                           developmental, or research work and Seller is not a
                           small business or nonprofit organization.

                     b.    Paragraph(c)Cost Accounting Standards, paragraphs (1)
                           and (2) are deleted in their entirety:

                              (1) (Applicable if this contract incorporates
                           clause 3050) The version of FAR 52.230-2, Cost
                           Accounting Standards, incorporated by clause 3050 is
                           the version dated April 1998.

                              (2)(Applicable if this contract incorporates
                           clause 3051). The version of FAR 52.230-3, Disclosure
                           and Consistency of Cost Accounting Practices,
                           incorporated by clause 3051 is the version dated
                           April 1998.

            (2)   Clause 3068

                        a.    Section H.1.b. is amended to add "SAIC" between
                              "Boeing" and "U.S. Government

I.2   ADDITIONAL FULL-TEXT PROVISIONS

      The following additional full-text provisions apply to this contract:

                                   None

                                END OF SECTION I



                                            PURCHASE CONTRACT NUMBER: 4400078647

[SAIC (R) LOGO] SCIENCE APPLICATIONS
                INTERNATIONAL CORPORATION
                An Employee-Owned Company       PAGE 48 A OF 48, REV. C (SA-006)
                                                                (MARCH 31, 2005)



EXHIBIT/
ATTACH. #                       DOCUMENT TITLE                                         DATE
- ---------                       --------------                                         ----
                                                                          
J-11        List of Hazardous Materials to be delivered under this subcontract       Reserved

J-12        FCS SDD Program Plan Summary (Version 1.0X)                            17 MAR 2005

J-13        Task Instructions                                                      06 FEB, 2004

J-14        DARPA-CG-228 "Security Classification Guide,
            Objective Force-Future Combat Systems"   (to be provided
            under separate cover)                                                  28 MAR. 2003

J-15        CPFF Task Order Rates and Supporting Information                     See Attached FPR
            Requirements                                                        Proposal Submittal

J-16        Contract Delivery/Performance Schedule                                 25 MAR 2005

J-17        Subcontractor Property Administration Requirements                     08 OCT. 2003
            For Subcontractors Without An Approved System

J-18        Reserved                                                                 Reserved

J-19        FCS One Team (ADR) Alternate Dispute Resolution Memorandum
            of Agreement                                                          Draft 04/12/04


                                END OF SECTION J
                                 END OF CONTRACT

                                                                   EXHIBIT 10.17

                                                                   PAGE OF PAGES
                                                                     1      51

SOLICITATION, OFFER AND AWARD

1. THIS CONTRACT IS A RATED ORDER               RATING______________________

   UNDER DPAS (15 CFR 700)

2. CONTRACT NO.

N00174-03-D-0003

3. SOLICITATION NO.

N00174-02-R-0032

4. TYPE OF SOLICITATION

[ ] SEALED BID (IFB)

[X] NEGOTIATED (RFP)

5. DATE ISSUED

08 May 2002

6. REQUISITION/PURCHASE NO.___________________

7. ISSUED BY                                CODE N00174

NAVSEA INDIAN HEAD
101 STRAUSS AVE.
ATTN: JESSICA MADDOX 11431 MADDOXJD@IH.NAVY.MIL

INDIAN HEAD, MD 20640-5035

8. ADDRESS OFFER TO (If other than Item 7)               CODE _________

   SEE ITEM 7

NOTE: In sealed bid solicitations "offer" and "offeror" mean "bid" and "bidder"

                                  SOLICITATION

9. Sealed offers in original and 2 copies for furnishing the supplies or
services in the Schedule will be received at the place specified in Item 8, or
if handcarried, in the depository located in Bldg. 1558
until 1500 local time 06 Jun 2002
      ----            -----------
     (Hour)              (Date)

CAUTION - LATE Submissions, Modifications, and Withdrawals: See Section L,
Provision No. 52.214-7 or 52.215-1. All offers are subject to all terms and
conditions contained in this solicitation.

10. FOR INFORMATION CALL:

A. NAME

   JESSICA D. MADDOX

B. TELEPHONE (Include area code) (NO COLLECT CALLS)

   301/744-6614

C. E-MAIL ADDRESS

   maddoxjd@ih.navy.mil

11. TABLE OF CONTENTS



(X)   SEC.            DESCRIPTION                         PAGE(S)
- ---   ----            -----------                         -------
                                                 
                    PART I - THE SCHEDULE

[X]    A    SOLICITATION/ CONTRACT FORM                      1
[X]    B    SUPPLIES OR SERVICES AND PRICES/ COSTS           2
[X]    C    DESCRIPTION/ SPECS./ WORK STATEMENT             10
[X]    D    PACKAGING AND MARKING                           18
[X]    E    INSPECTION AND ACCEPTANCE                       20
[X]    F    DELIVERIES OR PERFORMANCE                       21
[X]    G    CONTRACT ADMINISTRATION DATA                    25
[X]    H    SPECIAL CONTRACT REQUIREMENTS                   28

               PART II - CONTRACT CLAUSES

[X]    I    CONTRACT CLAUSES                                34

            PART III - LIST OF DOCUMENTS, EXHIBITS
                    AND OTHER ATTACHEMENTS

[X]   J     LIST OF ATTACHMENTS                             40

            PART IV - REPRESENTATIONS AND INSTRUCTIONS

      K     REPRESENTATIONS, CERTIFICATIONS AND OTHER
            STATEMENTS OF OFFERORS
      L     INSTRS., CONDS., AND NOTICES TO OFFERORS
      M     EVALUATION FACTORS FOR AWARD


                   OFFER (MUST BE FULLY COMPLETED BY OFFEROR)

NOTE: Item 12 does not apply if the solicitation includes the provisions at
52.214-16, Minimum Bid Acceptance Period.

12. In compliance with the above, the undersigned agrees, if this offer is
accepted within _____________ calendar days (60 calendar days unless a
different period is inserted by the offeror) from the date for receipt of offers
specified above, to farnish any or all items upon which prices are offered at
the price set opposite each item, delivered at the designated point(s), within
the time specified in the schedule.

13. DISCOUNT FOR PROMPT PAYMENT
    (See Section I, Clause No. 52.232-8)

14. ACKNOWLEDGMENT OF AMENDMENTS
(The offeror acknowledges receipt of amendments to the SOLICITATION for offerors
and related documents numbered and dated):



AMENDMENT NO.               DATE           AMENDMENT NO.          DATE
- -------------               ----           -------------          ----
                                                        
_____________              _______         _____________         ________
_____________              _______         _____________         ________


15A. NAME AND ADDRESS OF OFFEROR        CODE 1BNT3          FACILITY __________

     IROBOT CORP
     DUNS #604499194
     37 WILTON ROAD
     MILFORD NH 03055

15B. TELEPHONE NO (Include  area code)

     603/654-3400

[ ] 15C. CHECK IF REMITTANCE ADDRESS IS DIFFERENT FROM ABOVE - ENTER SUCH
          ADDRESS IN SCHEDULE.

16. NAME AND TITLE OF PERSON AUTHORIZED TO SIGN OFFER (Type or print)

    GRINNELL MORE

17. SIGNATURE_____________

18. OFFER DATE____________

                      AWARD (TO BE COMPLETED BY GOVERNMENT)

19. ACCEPTED AS TO ITEMS NUMBERED

           0001 through 0025

20. AMOUNT

$27,878,792.00

21. ACCOUNTING AND APPROPRIATION

22. AUTHORITY FOR USING OTHER THAN FULL AND OPEN COMPETITION:

      [ ] 10 U.S.C. 2304(c)( )     [ ] 41 U.S.C. 253(c)( )

23. SUBMIT INVOICES TO ADDRESS SHOWN IN        ITEM ____________

(4 copies unless otherwise specified)

24. ADMINISTERED BY (If other than Item 7)       CODE S3319A

DCMC BOSTON-MANCHESTER
2 WALL STREET
MANCHESTER, NH 03101-1518

25. PAYMENT WILL BE MADE BY             CODE   HQ0337

DFAS-COLUMBUS CENTER
NORTH ENTITLEMENT OPERATIONS   P O BOX 182266
COLUMBUS, OH 43218-2266

26. NAME OF CONTRACTING OFFICER (Type or print)

   RENEE M. BROWN

27. UNITED STATES OF AMERICA

    /s/ Renee M. Brown
    -----------------------------------
    (Signature of Contracting Officer)

28. AWARD DATE

    10/29/02

IMPORTANT - Award will be made on this Form, or on Standard Form 26, or by other
authorized official written notice.

Previous Edition is Unusable      33-134           STANDARD FORM 33 (REV. 9-97)
                                                   Prescribed by GSA
                                                   FAR(48CFR)53.214(c)


CONTINUATION SHEET       REFERENCE NO. OF DOCUMENT BEING CONTINUED      PAGE
                          N00174-03-D-0003                               2 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SECTION B Supplies or Services and Prices

PHASE I - PSVM
GUARANTEED MINIMUM

Under Phase I, a firm fixed price order will be issued for CLINs 0001 through
0009. Testing will be performed to validate the system against the Performance
Specification. The ordering period for Phase I shall be from date of award until
six (6) months after date of contract (ADC).



ITEM NO     SUPPLIES/SERVICES     MAX QUANTITY   UNIT   UNIT PRICE    MAX AMOUNT
                                                      
0001      Performance                 2.00       Each   $89,400.00   $178,800.00
          Specification
          Verification Models
          (PSVM) in accordance
          with the Statement of
          Work and Performance
          Specification.




ITEM NO     SUPPLIES/SERVICES     MAX QUANTITY   UNIT   UNIT PRICE    MAX AMOUNT
                                                       
0002      Post Award Conference                  Lot        NSP          NSP
          in accordance with
          paragraph 2.2.2.1 of
          the Statement of
          Work.




ITEM NO     SUPPLIES/SERVICES     MAX QUANTITY   UNIT   UNIT PRICE    MAX AMOUNT
                                                       
0003      Project Reviews in                     Lot       NSP           NSP
          accordance with
          paragraph 2.2.2.2 of
          the Statement of
          Work.




ITEM NO     SUPPLIES/SERVICES     MAX QUANTITY   UNIT   UNIT PRICE    MAX AMOUNT
                                                      
0004      Monthly Status             1.00        Lot    $10,500.00   $ 10,500.00
          Reports in accordance
          with paragraph 2.2.3
          of the Statement of
          Work.


NSN 7540-01-152-8057               50336-101           OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET   REFERENCE NO. OF DOCUMENT BEING CONTINUED   PAGE
                      N00174-03-D-0003                            3 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP



ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0005      Safety Assessment           1.00       Lot    $16,000.00   $ 16,000.00
          Report in accordance
          with paragraph 2.2.4
          of the Statement of
          Work and MIL-STD-882D.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0006      Lithium Batteries           1.00       Lot        N/A          N/A
          Technical Data in
          accordance with
          paragraph 2.2.5 of the
          Statement of Work and
          the Performance
          Specification.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0007      Operation and               1.00       Lot    $11,520.00   $ 11,520.00
          Maintenance Source
          Data in accordance
          with paragraph 2.2.6
          of the Statement of
          Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0008      Training in accordance      1.00       Lot    $ 3,600.00   $  3,600.00
          with paragraph 2.2.7.1
          of the Statement of
          Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0009      Engineering Services        1.00       Lot    $100,000.00     $100,000.00
          in accordance with                                         (NTE $100,000.00)
          paragraph 2.2.7.2 of
          the Statement of Work.


NSN 7540-01-152-8057            50336-101              OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET     REFERENCE NO. OF DOCUMENT BEING CONTINUED    PAGE
                        N00174-03-D-0003                             4 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

PHASE II - PRM

During Phase I, the Government is going to test the PSVMs to the Performance
Specification for conformance. There may be some minor modifications that will
be requested by the Government. The purpose of Phase II is to incorporate those
changes. The contractor(s) will receive a Request for Quotation identifying the
minor modifications that need to be made. Once the price has been determined
reasonable, the Government will issue a fixed price order(s). The Government
will utilize the Not to Exceed CLIN 0012 for the modifications. If the
Government does not want change from Phase I, then Phase II will not be funded.
It is also possible that Phase II will only be funded for one(1) contractor.
Phase II includes CLINs 0011 through 0016 and the ordering period for Phase II
shall be from eighteen (18) months after date of contract (ADC) through
twenty-four (24) months ADC.



ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0010      Production                  2.00       Each   $93,500.00   $187,000.00
          Representative Models
          (PRM) in accordance
          with paragraph 2.3.1 of
          the Statement of Work
          and the updated (if
          necessary) Performance
          Specification.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0011      Minor Modifications in      1.00       Lot    $20,000.00        $20,000.00
          accordance with the                                        (NTE $20,000.00)
          Request for Quotation.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0012      Project Reviews in                     Lot        NSP          NSP
          accordance with
          paragraph 2.2.2.3 of
          the Statement of Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0013      Monthly Status Reports      1.00       Lot    $ 6,000.00   $ 6,000.00
          in accordance with
          paragraph 2.3.4 of the
          Statement of Work.


NSN 7540-01-152-8057                50336-101          OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET     REFERENCE NO. OF DOCUMENT BEING CONTINUED    PAGE
                        N00174-03-D-0003                             5 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP



ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0014      Initial Spares List in      1.00       Lot    $11,622.00   $11,622.00
          accordance with
          paragraph 2.3.2 of the
          Statement of Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0015      Engineering Services        1.00       Lot    $25,000.00      $25,000.00
          in accordance with                                         (NTE $25,000.00)
          paragraph 2.3.3 of the
          Statement of Work.


NSN 7540-01-152-8057            50336-101              OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET      REFERENCE NO. OF DOCUMENT BEING CONTINUED     PAGE
                         N00174-03-D-0003                              6 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

PHASE III - PRODUCTION

Phase III is for production. Only one contractor will be funded for the
Production phase. At contract award, the contractor shall provide an estimated
unit price. Prior to entering into Phase III, the Government will issue a
Request for Proposal (RFP) to the contractor(s). The RFP will request the
contractor to provide their final production unit costs based on the final
system configuration agreed upon in Phase II or Phase I should the Government
decide not to fund Phase II. The offeror who offers the lowest unit price will
be funded for the production phase. Phase III includes CLINs 0017 through 0025
and the ordering period for Phase III shall be from twenty-eight (28) months
after date of contract (ADC) through ten (10) years ADC.



ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0016      Production Systems in      250.00      Each                $ 22,168,750.00*
          accordance with
          paragraph 2.4.1 of the
          Statement of Work and
          the updated (if
          necessary) Performance
          Specification.


           STEPLADDER PRICING



FROM QUANTITY    TO QUANTITY    UNIT PRICE
                          
  1.00               50.00      $88,675.00
 51.00              100.00      $85,720.80
101.00              150.00      $74,519.50
151.00              200.00      $71,714.00
201.00              250.00      $64,795.50


* The mount displayed in the "Max Amount" column should be the total of 250
units x the highest unit price in the stepladder pricing.



ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE   MAX AMOUNT
                                                      
0017      Standard Commercial                    Lot        NSP           NSP
          Warranty in accordance
          with paragraph 2.5.1
          of the Statement of
          Work.


NSN 7540-01-152-8057            50336-101              OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET        REFERENCE NO. OF DOCUMENT BEING CONTINUED    PAGE
                            N00174-03-D-0003                            7 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP



ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0018      Initial Spares in           1.00       Lot    $787,500.00     $787,500.00
          accordance with                                            (NTE $787,500.00)
          paragraph 2.4.2 of the
          Statement of Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0019      Chemical Detection          1.00       Lot    $200,000.00     $200,000.00
          Mission Package in                                         (NTE $200,000.00)
          accordance with
          paragraph 2.4.3.1 of
          the Statement of Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0020      Nuclear Detection           1.00       Lot    $200,000.00     $200,000.00
          Mission Package in                                         (NTE $200,000.00)
          accordance with
          paragraph 2.4.3.2 of
          the Statement of Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0021      Render Safe Mission         1.00       Lot    $200,000.00     $200,000.00
          Package in accordance                                      (NTE $200,000.00)
          with paragraph 2.4.3.3
          of the Statement of
          Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0022      Disruption Mission          1.00       Lot    $200,000.00     $200,000.00
          Package in accordance                                      (NTE $200,000.00)
          with paragraph 2.4.3.4
          of the Statement of
          Work.


NSN 7540-01-152-8057            50336-101              OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET       REFERENCE NO. OF DOCUMENT BEING CONTINUED   PAGE
                          N00174-03-D-0003                            8 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP



ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT   UNIT PRICE      MAX AMOUNT
                                                      
0023      Disposal Mission            1.00       Lot    $200,000.00     $200,000.00
          Package in accordance                                      (NTE $200,000.00)
          with paragraph 2.4.3.5
          of the Statement of
          Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT    UNIT PRICE       MAX AMOUNT
                                                        
0024      Depot Repair Services       1.00       Lot    $1,676,250.00   $1,676,250.00
          in accordance with                                           (NTE $1,676,250)
          paragraph 2.5.2 of the
          Statement of Work.




ITEM NO      SUPPLIES/SERVICES    MAX QUANTITY   UNIT    UNIT PRICE       MAX AMOUNT
                                                        
0025      Repair Parts in             1.00       Lot    $1,676,250.00   $1,676,250.00
          accordance with                                              (NTE $1,676,250)
          paragraph 2.5.3 of the
          Statement of Work.


CLAUSES INCORPORATED BY FULL TEXT

PHASE III - PRODUCTION

Phase III is for production. Only one contractor will be funded for the
Production phase. At contract award, the contractor shall provide an estimated
unit price. Prior to entering into Phase III, the Government will issue a
Request for Proposal (RFP) to the contractor(s). The RFP will request the
contractor to provide their final production unit costs based on the final
system configuration agreed upon in Phase II or Phase I should the Government
decide not to fund Phase II. The offeror who offers the lowest unit price will
be funded for the production phase. Phase III includes CLINs 0017 through 0025
and the ordering period for Phase III shall be from twenty-eight (28) months
after date of contract (ADC) through ten (10) years ADC.

NSN 7540-01-152-8057             50336-101             OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET        REFERENCE NO. OF DOCUMENT BEING CONTINUED    PAGE
                           N00174-03-D-0003                             9 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP



ITEM NO      SUPPLIES/SERVICES     MAX QUANTITY   UNIT   UNIT PRICE     MAX AMOUNT
                                                      
0016      Production Systems in       250.00      Each               $22,168,750.00*
          accordance with
          paragraph 2.4. 1 of the
          Statement of Work and
          the updated (if
          necessary) Performance
          Specification.


          STEPLADDER PRICING



FROM QUANTITY    TO QUANTITY    UNIT PRICE
                          
  1.00               50.00      $88,675.00
 51.00              100.00      $85,720.80
101.00              150.00      $74,519.50
151.00              200.00      $71,714.00
201.00              250.00      $64,795.50


*The mount displayed in the "Max Amount" column should be the total of 250 units
x the highest unit price in the stepladder pricing.

SEA B-23 - EXPEDITING CONTRACT CLOSEOUT (NAVSEA) (DEC 1995)

(a) As part of the negotiated fixed price or total estimated amount of this
contract, both the Government and the Contractor have agreed to waive any
entitlement that otherwise might accrue to either party in any residual dollar
amount of $500 or less at the time of final contract closeout. The term
"residual dollar amount" shall include all money that would otherwise be owed to
either party at the end of the contract, except that, amounts connected in any
way with taxation, allegations of fraud and/or antitrust violations shall be
excluded. For purposes of determining residual dollar amounts, offsets of money
owed by one party against money that would otherwise be paid by that party may
be considered to the extent permitted by law.

(b) This agreement to waive entitlement to residual dollar amounts has been
considered by both parties. It is agreed that the administrative costs for
either party associated with collecting such small dollar amounts could exceed
the amount to be recovered.

NSN 7540-01-152-8057          50336-101                OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



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                          N00174-03-D-0003                            10 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SECTION C Descriptions and Specifications

CLAUSES INCORPORATED BY FULL TEXT

                                STATEMENT OF WORK
                        MAN TRANSPORTABLE ROBOTIC SYSTEM

1.0   SCOPE

      This statement of work (SOW) describes the contractor's tasks required for
the modified commercial item acquisition and support of a Man Transportable
Robotic System (MTRS).

1.1   BACKGROUND

      The MTRS will provide the military Explosive Ordnance Disposal (EOD)
technician with a man transportable capability to remotely perform
reconnaissance during extremely hazardous EOD missions involving unexploded
ordnance (UXO) and improvised explosive devices (IEDs). The MTRS will be able to
operate in both urban and rural environments. The MTRS will be a modular system
that will allow interoperability with future mission packages such as chemical
and nuclear detectors, EOD render safe tools, EOD disruption tools, and EOD
disposal tools. The system architecture (hardware and software) of the MTRS will
be inherently expandable and inherently upgradeable to allow for future
enhancements.

2.0   REQUIREMENTS

2.1   GENERAL

      The contractor shall deliver two MTRS performance specification
verification models (PSVM 1 and PSVM 2) to the Government that are in compliance
with the performance specification (Appendix A). The compliance of the PSVMs
with the performance specification will be verified through testing and analysis
that will be performed by the Government. The performance specification
constitutes the system functional/performance baseline for the MTRS. The
performance specification may be updated, as necessary, based on the results of
the Government's testing and analysis of the PSVMs. The Government may purchase
two production representative models (PRM 1 and PRM 2) that conform to the
updated performance specification. Any changes to the MTRS due to the updating
of the performance specification shall be subject to the changes clause of the
contract. The PRMs will undergo final testing to be performed by the Government
prior to a Production Approval decision. Following a successful Production
Approval decision, the Government may purchase up to 250 production units,
initial spares, and post-production support.

2.2   PERFORMANCE SPECIFICATION VERIFICATION MODELS PHASE

2.2.1 PERFORMANCE SPECIFICATION VERIFICATION MODELS. The contractor shall
deliver two MTRS PSVMs that are in compliance with the performance
specification.

2.2.2 REVIEWS

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110


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                          N00174-03-D-0003                             11 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

2.2.2.1 POST AWARD GUIDANCE CONFERENCE. The contractor shall attend a Post Award
Guidance Conference to be hosted by the Government at the NAVEODTECHDIV no later
than 15 days after contract award.

2.2.2.2 PROJECT REVIEWS. The contractor shall schedule and host at least two
project reviews prior to the delivery of PSVM 1 and PSVM 2. The purpose of the
project reviews is to update the Government on project progress and issues.
There will be no changes made to the requirements at these reviews. Any changes
in the requirements will be processed by the Contracts Division at NAVSEA Indian
Head and the contractor(s) shall take no action until receipt of a properly
executed modification. If the Government decides to purchase the PRMs, the
contractor shall schedule and host at least one project review prior to the
delivery of the PRMs.

2.2.3 STATUS REPORT. The contractor shall prepare monthly status reports. The
reports shall contain the following main sections: Summary; Accomplishments;
Current Status; Problem Areas; Risks and Mitigation; and, Future Plans. The
inclusion of financial data is not required. The reporting period consists of
the entire PSVM phase, which is estimated at 21 months. The first monthly report
is due 45 days after contract award.

2.2.4 SAFETY ASSESSMENT REPORT. The contractor shall prepare a Safety Assessment
Report (SAR). The SAR shall be a comprehensive evaluation of the mishap risks
associated with identified MTRS hazards. Identified hazards shall include any
procedural hazards that may be present. The assessment of mishap risk shall
include the characterization of mishap risks by mishap severity and mishap
probability. Mishaps may result from personnel error, environmental conditions,
design inadequacies, procedural deficiencies, or system, subsystem, or component
failure or malfunction. The SAR shall identify all safety features of the
hardware, software, and system design that eliminate identified hazards or
reduce the combination of a potential mishap's severity and probability to an
acceptable level. MIL-STD-882D, Standard Practice for System Safety, methodology
should be used.

      The MTRS firing circuit shall receive special emphasis in the SAR. Mishaps
involving the firing circuit have a reasonable potential to result in the death
of personnel. The SAR shall include a failure mode analysis of the firing
circuit that identifies how the firing circuit may fail and the impact of each
failure mode on personnel safety. Failure modes analyzed shall include those
involving hardware, electronics, software, and procedures (including
combinations thereof).

      The contractor shall deliver a draft report no later than 120 days after
contract award. The Government will review the draft and provide comments within
30 days. The contractor shall deliver the final report within 30 days of receipt
of the Government's comments.

2.2.5 LITHIUM BATTERY SYSTEM TECHNICAL DATA. The contractor shall provide a
technical data package for any lithium battery systems (including charger) that
are to be used in the MTRS. The contractor shall deliver the data no later than
30 days after contract award.

2.2.6 OPERATION & MAINTENANCE SOURCE DATA. The contractor shall provide
Operation & Maintenance (O&M) source data to the Government in electronic form
(compatible with Microsoft Office and, where applicable, the Drawing Exchange
Format (DXF)). The source data will be used by the Government to develop EOD
unique technical manuals for the MTRS. The source data shall contain the
necessary documentation (including drawings) for the operation and maintenance
of the MTRS. The documentation shall include:

      -     Description of assemblies, subassemblies, and component parts with
            purpose and function

      -     Detailed instructions on assembling, operating, and disassembling
            the system

      -     Safety information (including hazardous materials)

      -     Preventive maintenance procedures (including inspection
            requirements) describing periodic measures to ensure the MTRS
            remains in good working condition

NSN 7540-01-152-8057            50336-101              OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



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                          N00174-03-D-0003                            12 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

      -     Comprehensive detailed and unambiguous step-by-step troubleshooting
            and repair procedures appropriate for the organizational (field)
            level

      -     List of all components that are deemed to be cost-effective to
            repair at the depot level

      -     All information necessary to procure repair parts and consumables

      -     Estimated replacement factors for major components (e.g. replace
            component "X" after 200 hours)

      -     Detailed operation and maintenance training course curriculum

The contractor shall deliver the data with the PSVMs.

2.2.7 TECHNICAL SUPPORT

2.2.7.1 TRAINING. The contractor shall provide training for the operation and
maintenance of the MTRS for Government personnel immediately after the delivery
of the PSVMs. The training shall be conducted at a Government location in the
Southern Maryland area, for no more than six personnel, for no more than three
days.

2.2.7.2 ENGINEERING SERVICES. The contractor shall provide engineering services
on an as needed basis for a period of up to 12 months, commencing immediately
upon delivery of the PSVMs. Engineering services shall include any labor, repair
parts, and other items necessary to keep the PSVMs fully operational.
Engineering services shall also include failure analysis and reporting.

2.3 PRODUCTION REPRESENTATIVE MODELS PHASE

2.3.1 PRODUCTION REPRESENTATIVE MODELS. If ordered by the Government, the
contractor shall deliver two MTRS PRMs that conform to the updated (if
necessary) performance specification.

2.3.2 INITIAL SPARES LIST. If ordered by the Government, the contractor shall
deliver a recommended list of initial spares for the MTRS. The contractor shall
deliver the list with the PRMs.

2.3.3 ENGINEERING SERVICES. If ordered by the Government, the contractor shall
provide engineering services on an as needed basis for a period of up to 9
months, commencing immediately upon delivery of the PRMs. Engineering services
shall include any labor, repair parts, and other items necessary to keep the
PRMs fully operational. Engineering services shall also include failure analysis
and reporting.

2.3.4 STATUS REPORT. If ordered by the Government, the contractor shall prepare
monthly status reports. The reports shall contain the following main sections:
Summary; Accomplishments; Current Status; Problem Areas; Risks and Mitigation;
and, Future Plans. The inclusion of financial data is not required. The
reporting period consists of the entire PRM phase, which is estimated at 12
months. The first monthly report is due 30 days after the Government orders the
PRMs.

2.4 PRODUCTION PHASE

2.4.1 PRODUCTION SYSTEMS. If ordered by the Government, the contractor shall
deliver up to 250 production systems after a successful Production Approval
decision.

2.4.2 INITIAL SPARES. If ordered by the Government, the contractor shall deliver
initial spares with the production systems as required. (Initial spares will be
ordered separately from the production systems.)

NSN 7540-01-152-8057          50336-101                OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET       REFERENCE NO. OF DOCUMENT BEING CONTINUED    PAGE
                          N00174-03-D-0003                             13 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

2.4.3 ENGINEERING ENHANCEMENTS. After a successful Production Approval decision
the Government may elect to have the contractor pursue the following MTRS
engineering enhancements during the production window of the contract.

2.4.3.1 CHEMICAL DETECTION MISSION PACKAGE. The contractor shall perform the
analysis, design, prototyping, testing, and documentation necessary to produce a
chemical detection mission package that is modular with respect to the MTRS. Any
changes to the MTRS that are necessary to accommodate the chemical detection
mission package shall be capable of being accomplished in the field by EOD
personnel. The specific chemical detector to be used will be determined by the
Government.

2.4.3.2 NUCLEAR DETECTION MISSION PACKAGE. The contractor shall perform the
analysis, design, prototyping, testing, and documentation necessary to produce a
nuclear detection mission package that is modular with respect to the MTRS. Any
changes to the MTRS that are necessary to accommodate the nuclear detection
mission package shall be capable of being accomplished in the field by EOD
personnel. The specific nuclear detector to be used will be determined by the
Government.

2.4.3.3 RENDER SAFE MISSION PACKAGES. The contractor shall perform the analysis,
design, prototyping, testing, and documentation necessary to produce render safe
mission packages that are modular with respect to the MTRS. Any changes to the
MTRS that are necessary to accommodate the render safe mission packages shall be
capable of being accomplished in the field by EOD personnel. The specific EOD
render safe tools to be used will be determined by the Government.

2.4.3.4 DISRUPTION MISSION PACKAGES. The contractor shall perform the analysis,
design, prototyping, testing, and documentation necessary to produce disruption
mission packages that are modular with respect to the MTRS. Any changes to the
MTRS that are necessary to accommodate the disruption mission packages shall be
capable of being accomplished in the field by EOD personnel. The specific EOD
disruption tools to be used will be determined by the Government.

2.4.3.5 DISPOSAL MISSION PACKAGES. The contractor shall perform the analysis,
design, prototyping, testing, and documentation necessary to produce disposal
mission packages that are modular with respect to the MTRS. Any changes to the
MTRS that are necessary to accommodate the disposal mission packages shall be
capable of being accomplished in the field by EOD personnel. The specific EOD
disposal tools to be used will be determined by the Government.

2.5 POST-PRODUCTION SUPPORT PHASE

      The contractor shall provide post-production support for the life
(estimated to be 12 years) of each delivered production system.

2.5.1 WARRANTY. Each production system shall be covered by the contractor's
standard commercial warranty.

2.5.2 DEPOT REPAIR. The contractor shall provide depot repair services in
accordance with their commercial practices.

2.5.3 REPAIR PARTS. The contractor shall provide for the timely and adequate
provisioning of repair parts in accordance with their commercial practices.

NSN 7540-01-152-8057            50336-101              OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



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                          N00174-03-D-0003                              14 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

2.5.4 TROUBLESHOOTING ASSISTANCE. The contractor shall provide troubleshooting
assistance to field activities in accordance with their commercial practices.

2.5.5 CONFIGURATION MANAGEMENT. The contractor shall manage the configuration
(including hardware and software) of the MTRS, including the implementation of
changes and upgrades, throughout the life of the MTRS in accordance with their
commercial practices.

2.6 DOCUMENTATION/DATA RIGHTS.

      In the event of the demise of the contractor, the contractor shall make
available to the Government the documentation/data rights necessary to support
and procure the MTRS.

3.0 DATA REQUIREMENTS

      The following is a list of the required data that shall be delivered.



SOW PARAGRAPH                      DATA                                 DELIVERY DATE
- -------------     -------------------------------------    ---------------------------------------
                                                     
2.2.3             Monthly Status Reports                   First submission 45 days after contract
                  (PSVM Phase)                             award

2.2.4             Safety Assessment Report                 Draft 120 days after contract award;
                                                           Final 30 days after receipt of comments
                                                           from Government

2.2.5             Lithium Battery System Technical Data    30 days after contract award
                  (if lithium batteries are used)

2.2.6             Operation & Maintenance Source Data      With delivery of PSVMs

2.3.2             Initial Spares List                      With delivery of PRMs

2.3.4             Monthly Status Reports                   First submission 30 days after order of
                  (PRM Phase)                              PRMs


NSN 7540-01-152-8057         50336-101                 OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET        REFERENCE NO. OF DOCUMENT BEING CONTINUED    PAGE
                           N00174-03-D-0003                             15 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SEA C-19 - CONFIGURATION MANAGEMENT (NAVSEA) (JUN 1999)

(a) Baseline Definition - For configuration control purposes, all contractual
documentation in effect at the time of contract award shall constitute the
Contract Baseline which shall be considered incorporated in the baseline
documentation.

(b) General Requirement - (1) The Contractor shall maintain a Configuration
Control Program to assure that all detail level work being performed under this
contract is in compliance with appropriate baseline documentation. The
Contractor shall prepare a Configuration Management Plan for approval by the
Government.

      (2) Whenever a situation arises wherein the Contractor cannot comply with
a baseline document, or whenever intent of such documentation is significantly
changed by detail level documentation, the Contractor shall submit change
documents to modify baseline documents to resolve the conflict or to allow
non-compliance. Whenever the cost of implementing a proposed change is less than
$500,000, the Contractor shall provide documentation explaining the nature of
related costs as shown on the change document. Whenever the contract cost
changes by more than $500,000, the Contractor shall complete such cost and
pricing data as the Contracting Officer shall require detailing all related
costs, and attach it to the change document. Change documentation shall be
submitted to the Supervisor in accordance with the Contract Data Requirements
List (CDRL), and as described in paragraphs (c) through (f) below.

Engineering Change Proposals (Short Form, DP Form 1693) - MIL-STD-973 shall be
used as general guidance for completing this standard form. This form shall be
used whenever the detail level physical configuration, material quality,
operational or functional performance of equipment or installed systems will not
be in compliance with baseline design-related documents (Ship Specifications,
Contract Drawings, etc.), and a change to the baseline document is considered an
appropriate means of resolving a design-related issue. Documentation shall be
developed in sufficient detail to enable Government review and evaluation of the
merits of the proposed change, including cost and scheduling impact, ship class
impact, and consequences if disapproved. Due to space limitations of the
Standard DD Form 1693, the Contractor may use form continuation sheets to assure
that sufficient detailed information, including appropriate illustrations, is
provided. All existing drawings and technical manuals impacted by the change
shall be listed along with a brief narrative explanation of needed changes to
incorporate the Engineering Change Proposal (ECP) if approved. Weight and moment
data incidental to the change shall be provided in Block 15 of the form. The
Contractor shall also prepare applicable baseline document insert sheets, with
specific word changes or proposed re-write, to facilitate baseline documentation
changes.

(d) Non-Engineering Change Proposals (NAVSEA Form 4130) - This form shall be
used to document administrative, procedural, scheduling, or documentation
changes that do not directly impact the physical configuration of the ship. The
completed Form 4130 should explain the nature of the problem, identify the
applicable baseline document (i.e., Contract Data Requirement List (CDRL),
Contract Clause, etc.) and provide a detailed explanation justifying the
proposed course of action desired to resolve the problem. Due to the space
limitation on the form, continuation sheets may be used. Insert sheets for
applicable documents shall also be attached to facilitate change action in the
event the Non-Engineering Change Proposal (NECP) is approved.

(e) Deviations and Waivers (DD Form 1694) - In the event that a baseline
design-related document requirement cannot be met, and a change to the baseline
document is considered inappropriate, the Contractor shall submit a request for
deviation or waiver, as applicable. The explanation of "need for deviation" of
Block 24 should provide detailed justification and consequences of approval, to
include technical details explaining the degree of non-compliance or effect on
ship equipment or system operation constraints. In a similar manner, a waiver
shall

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET       REFERENCE NO. OF DOCUMENT BEING CONTINUED     PAGE
                          N00174-03-D-0003                              16 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

document an "as built" configuration that departs from baseline documentation,
and should include any proposed corrections or modifications to better meet the
intent of the baseline document. MIL-STD-973 provides guidance in completing DD
Form 1694.

(f) Equitable Adjustments for Change Documentation Preparations - For its effort
expended in preparing ECPs, NECPs, Deviations and Waivers, the Contractor shall
receive equitable adjustment under the following circumstances.

      (1) In the event the Contractor, on its own initiative, and without
written request from the Government, develops a change document that is later
disapproved by the Government, the Contractor shall bear the cost of this
effort.

      (2) To avoid such loss, and at its option, the Contractor may submit a
"preliminary" document that outlines intent, but without detailed supporting
documentation and request the Supervisor's approval for expenditure of effort to
complete the detailed supporting documentation. In the event the Supervisor
denies this request, the Contractor will bear the cost of development of the
"preliminary" document, and shall make no further effort to complete detailed
supporting documentation.

      (3) In the event the Supervisor approves the Contractor's request to
develop supporting documentation, the Contractor shall be equitably compensated
for its effort for both the "preliminary" and "final" documentation, regardless
of whether or not the change document is later approved.

      (4) In the event the Government requests in writing that the Contractor
develop change documentation, the effort expended by the Contractor in
developing such documentation shall be subject to equitable adjustment,
regardless of whether or not the change document is later approved.

      (5) In the event the Contractor, on its own initiative, and without
written request from the Government, develops a change document that is later
approved by the Government, the cost of developing such documentation shall be
incorporated in the contract modification that implements the change.

      (6) Failure to agree to such equitable adjustment in contract price shall
constitute a dispute, and shall be adjudicated in accordance with the
requirements of the clause entitled "DISPUTES" (FAR 52.233-1).

(g) The Contractor shall verify (by physical inspection of the vessel) to the
Government, that all Field Modification Requests (FMRs) and Headquarters
Modification Requests (HMRs) (including Government responsible trial items) have
been incorporated into the vessel. Verification shall include:

      (1) List of all HMRs and FMRs authorized to date.

      (2) List of those HMRs and FMRs verified to be complete.

      (3) List of those HMRs and FMRs which are partially complete or not
started with scheduled date for their completion.

(h) Any cost reduction proposal submitted pursuant to the clause entitled "VALUE
ENGINEERING" (FAR 52.248-1) shall be submitted as a Code V Engineering Change
Proposal (VECP) on the DD Form 1693 series and shall be supplemented by the
information required by the "VALUE ENGINEERING" clause.

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET      REFERENCE NO. OF DOCUMENT BEING CONTINUED      PAGE
                         N00174-03-D-0003                               17 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SEA C-20 - ASSIGNMENT AND USE OF NATIONAL STOCK NUMBERS (NAVSEA) (MAY 1993)

To the extent that National Stock Numbers (NSNs) or preliminary NSNs are
assigned by the Government for the identification of parts, pieces, items,
subassemblies or assemblies to be furnished under this contract, the Contractor
shall use such NSNs or preliminary NSNs in the preparation of provisioning
lists, package labels, packing lists, shipping containers and shipping documents
as required by applicable specifications, standards or Data item Descriptions of
the contract or as required by orders for spare and repair parts. The cognizant
Government Contract Administration Office shall be responsible for providing the
Contractor such NSNs or preliminary NSNs which may be assigned and which are not
already in possession of the Contractor.

SEA C-22 - CONTRACTOR'S PROPOSAL (NAVSEA) (SEP 1990)

(a)Performance of this contract by the Contractor shall be conducted and
performed in accordance with detailed obligations to which the Contractor
committed itself in Proposal MTRS dated 06 June 2002 and 10 September 2002 in
response to NAVSEA Solicitation No. N00147-02-R-0032.

(b)The technical volume(s) of the Contractor's proposal is incorporated by
reference and hereby made subject to the provisions of the "ORDER OF PRECEDENCE"
(FAR 52.215-8) clause of this contract. Under the "ORDER OF PRECEDENCE" clause,
the technical volume of the Contractor's proposal referenced herein is hereby
designated as item (f) of the clause, following "the specifications" in the
order of precedence.

SEA C-35 - PERMITS AND RESPONSIBILITIES (NAVSEA) (SEP 1990)

The Contractor shall, without additional expense to the Government, be
responsible for obtaining any necessary licenses and permits, and for complying
with any applicable Federal, State, and Municipal laws, codes, and regulations,
in connection with any movement over the public highways of overweight/over
dimensional materials.

SEA C-77 - LIMITATION OF LIABILITY - HIGH VALUE ITEMS (NAVSEA) (JUN 1992)

The following items are subject to the clause of this contract entitled
"LIMITATION OF LIABILITY--HIGH VALUE ITEMS" (FAR 52.246-24): CLINs 0001, 0010,
and 0016.

SEA C-85 - EXTENSION OF COMMERCIAL WARRANTY (NAVSEA) (NOV 1996)

The Contractor shall extend to the Government the full coverage of any standard
commercial warranty normally offered in a similar commercial sale, provided that
such warranty is available at no additional cost to the Government. The
Contractor shall provide a copy of the standard commercial warranty with the
item. The standard commercial warranty period shall begin upon the final
acceptance of the applicable material or software. Acceptance of the standard
commercial warranty does not waive the Government's rights under the
"Inspection" clause, nor does it limit the Government's rights with regard to
other terms and conditions of the contract. In the event of a conflict, the
terms and conditions of the contract shall take precedence over the standard
commercial warranty.

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET     REFERENCE NO. OF DOCUMENT BEING CONTINUED       PAGE
                        N00174-03-D-0003                                18 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SECTION D Packaging and Marking

CLAUSES INCORPORATED BY REFERENCE:

252.227-7026 Deferred Delivery Of Technical Data Or Computer Software   APR 1988

CLAUSES INCORPORATED BY FULL TEXT

SEA D-10 - IDENTIFICATION MARKING OF PARTS (NAVSEA) (NOV 1996)

Identification marking of individual parts within the systems, equipments,
assemblies, subassemblies, components, groups, sets or kits, and of spare and
repair parts shall be done in accordance with applicable specifications and
drawings. To the extent identification marking of such parts is not specified in
applicable specifications or drawings, such marking shall be accomplished in
accordance with the following:

      (1) Parts shall be marked in accordance with generally accepted commercial
practice.

      (2) In cases where parts are so small as not to permit identification
marking as provided above, such parts shall be appropriately coded so as to
permit ready identification.

SEA D-11 - MARKING AND PACKING LIST(S) (NAVSEA) (NOV 1996)

(a) Marking. Shipments, shipping containers and palletized unit loads shall be
 marked in accordance with best commercial practice.

(b) Packing List(s). A packing list (DD Form 250 Material Inspection and
Receiving Report may be used) identifying the contents of each shipment,
shipping container or palletized unit load shall be provided by the Contractor
with each shipment. When a contract line item identified under a single stock
number includes an assortment of related items such as kit or set components,
detached parts or accessories, installation hardware or material, the packing
list(s) shall identify the assorted items.

   Where assortment of related items is included in the shipping container, a
packing list identifying the contents shall be furnished.

(c) Master Packing List. In addition to the requirements in paragraph (b) above,
a master packing list shall be prepared where more than one shipment, shipping
container or palletized unit load comprise the contract line item being shipped.
The master packing list shall be attached to the number one container and so
identified.

(d) Part Identification. All items within the kit, set, installation hardware or
material shall be suitably segregated and identified within the unit pack(s) or
shipping container by part number and/or national stock number.

NSN 7540-01-152-8057          50336-101                OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET       REFERENCE NO. OF DOCUMENT BEING CONTINUED     PAGE
                          N00174-03-D-0003                              19 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SEA D-12 - WARRANTY NOTIFICATION FOR ITEM(S) 0016 - (NAVSEA) (NOV 1996)

The Contractor shall apply a permanent warranty notification stamping or marking
on each warranted deliverable end item and its container. The notification shall
be placed in close proximity to other required stamping or markings so as to be
easily readable by personnel. The warranty notification shall read:

                   THIS ITEM WARRANTED UNDER CONTRACT N00174-03-D-0003
                   TO CONFORM TO DESIGN, MANUFACTURING, AND
                   PERFORMANCE REQUIREMENTS AND BE FREE FROM
                   DEFECTS IN MATERIAL AND WORKMANSHIP
                   FOR __________________________________FROM
                   DATE OF ACCEPTANCE. IF ITEM IS DEFECTIVE
                   NOTIFY _________________________________ AND PCO.

SEA D-13 - PACKAGING LANGUAGE (W/O MILITARY SPECIFICATIONS)

Item(s) 0001, 0010, and 0016 - The supplies furnished hereunder shall be
packaged in accordance with best commercial practice.

IHD 31 - MARKING OF SHIPMENTS (COMMERCIALLY PACKAGED ITEMS)(NAVSEA/IHD) FEB 2000

(a) Marking shall be in accordance with ASTM D 3951-90,
"Commercial Packaging of Supplies and Equipment."

(b) Additional markings are stated below:

  Contract No:

  Bldg:       TO SPECIFIED ON INDIVIDUAL TASK/DELIVERY ORDERS

  Code:

*Note: When the item is over 1000 lbs the contractor is to stencil the weight on
the crate

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET      REFERENCE NO. OF DOCUMENT BEING CONTINUED      PAGE
                         N00174-03-D-0003                               20 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SECTION E Inspection and Acceptance

CLAUSES INCORPORATED BY REFERENCE:


                                                       
52.246-4         Inspection Of Services--Fixed Price         AUG 1996
52.246-2         Inspection Of Supplies--Fixed Price         AUG 1996
52.246-16        Responsibility For Supplies                 APR 1984
252.246-7000     Material Inspection And Receiving Report    DEC 1991


CLAUSES INCORPORATED BY FULL TEXT

SEA E-2 - INSPECTION AND ACCEPTANCE LANGUAGE FOR F.O.B. DESTINATION (NAVSEA)

Item(s) 0001, 0010, and 0016 - Inspection and acceptance shall be made at
destination by a representative of the Government.

IHD 44 - INSPECTION AND ACCEPTANCE (SPECIAL CONDITIONS)(NAVSEA/IHD) FEB 2000

(a)Initial inspection of the supplies to be furnished hereunder shall be made by
IROBOT CORPORATION at the contractor's or subcontractor's plant located at
MILFORD, NH. The cognizant inspector shall be notified when the material is
available for inspection. The place designated for such actions shall not be
changed without authorization of the Contracting Officer. Final inspection and
acceptance shall be made by the GOVERNMENT within 30 days after RECEIPT OF THE
ITEM.

(b)Initial inspection shall consist of quality assurance at point of manufacture
and/or assembly and check/test prior to shipment. Final inspection and
acceptance will be made by the Receiving Activity after installation/check
out/testing of the supplies.

IHD 47 - INSPECTION AND ACCEPTANCE TIMEFRAME (NAVSEA/IHD) FEB 2000

Inspection and acceptance of supplies to be furnished under this contract shall
be made by the Government within 30 days after receipt of material. Payment will
be tendered not later than 30 days after acceptance has occurred.

IHD 49 - INSPECTION AND ACCEPTANCE (DESTINATION) (NAVSEA/IHD) (FEB 2000)

Inspection and acceptance of the supplies or services to be furnished hereunder
shall be made at destination by the receiving activity.

NSN 7540-01-152-8057          50336-101                OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET     REFERENCE NO. OF DOCUMENT BEING CONTINUED       PAGE
                        N00174-03-D-0003                                21 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SECTION F Deliveries or Performance

CLAUSES INCORPORATED BY REFERENCE:


                                        
52.242-15        Stop-Work Order              AUG 1989
52.242-17        Government Delay Of Work     APR 1984
52.247-34        F.O.B. Destination           NOV 1991


CLAUSES INCORPORATED BY FULL TEXT

52.211-8 TIME OF DELIVERY (JUN 1997)

(a) The Government requires delivery to be made according to the following
schedule:

                           REQUIRED DELIVERY SCHEDULE



CLINS      SUPPLIES/SERVICES               DELIVERY DATE           UNIT OF ISSUE    QUANTITY
                                                                        
0001    Performance Specification    270.00 days after receipt         Each           2.00
        Verification Models          of order (ARO)
        (PSVM)

0002    Post Award Conference        No later than 15.00 days          Lot
                                     ADC

0003    Project Reviews              At least two (2) prior to         Lot
                                     delivery of the PSVMs

0004    Monthly Status Reports       45 days ARO and every             Lot            1.00
                                     month thereafter

0005    Safety Assessment Report     No later than 120 days ARO        Lot            1.00

0006    Lithium Batteries            No later than 30 days ARO         Lot            1.00
        Technical Data

0007    Operation and Maintenance    270.00 days ARO                   Lot            1.00
        Source Data

0008    Training                     After delivery of PSVMs           Lot            1.00

0009    Engineering Services         Upon delivery of PSVMs            Lot            1.00


NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET      REFERENCE NO. OF DOCUMENT BEING CONTINUED      PAGE
                         N00174-03-D-0003                               22 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP


                                                                            
PHASE II

0010         Production Representative       90.00 days after order          Each         2.00
             Models (PRM)

0011         Minor Modifications in                                          Lot
             accordance with the
             Request for Proposal

0012         Project Reviews                 At least one (1) prior to       Lot
                                             delivery of the PRMs

0013         Monthly Status Reports          Monthly                         Lot          1.00

0014         Initial Spares List             90.00 days after order          Lot          1.00

0015         Engineering Services            Continuing from basic           Lot          1.00
                                             requirement for 270 days

PHASE III

0016         Production Systems              To be specified on              Each       250.00
                                             individual delivery
                                             orders

0017         Standard Commercial                                             Lot
             Warranty

0018         Initial Spares                  With production systems         Lot          1.00
                                             as required

0019         Chemical Detection              To be specified on              Lot          1.00
             Mission Package                 individual delivery order

0020         Nuclear Detection Mission       To be specified on              Lot          1.00
             Package                         individual delivery order

0021         Render Safe Mission             To be specified on              Lot          1.00
             Package                         individual delivery order

0022         Disruption Mission Package      To be specified on              Lot          1.00
                                             individual delivery order

0023         Disposal Mission Package        To be specified on              Lot          1.00
                                             individual delivery order

0024         Depot Repair Services           To be specified on              Lot          1.00
                                             individual delivery order


NSN 7540-01-152-8057          50336-101                OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110




CONTINUATION SHEET       REFERENCE NO. OF DOCUMENT BEING CONTINUED     PAGE
                          N00174-03-D-0003                              23 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP


                                                               
0025        Repair Parts         To be specified on            Lot         1.00
                                 individual delivery order


      The Government will evaluate equally, as regards time of delivery, offers
      that propose delivery of each quantity within the applicable delivery
      period specified above. Offers that propose delivery that will not clearly
      fall within the applicable required delivery period specified above, will
      be considered nonresponsive and rejected. The Government reserves the
      right to award under either the required delivery schedule or the proposed
      delivery schedule, when an offeror offers an earlier delivery schedule
      than require above. If the offeror proposes no other delivery schedule,
      the require delivery schedule above will apply.

                      OFFEROR'S PROPOSED DELIVERY SCHEDULE


                                        
ITEM NO.                QUANTITY              WITHIN DAYS AFTER DATE OF CONTRACT


(b) Attention is directed to the Contract Award provision of the solicitation
that provides that a written award or acceptance of offer mailed, or otherwise
furnished to the successful offeror, results in a binding contract. The
Government will mail or otherwise furnish to the offeror an award or notice of
award not later than the day award is dated. Therefore, the offeror should
compute the time available for performance beginning with the actual date of
award, rather than the date the written notice of award is received from the
Contracting Officer through the ordinary mails. However, the Government will
evaluate an offer that proposes delivery based on the Contractor's date of
receipt of the contract or notice of award by adding (1) five calendar days for
delivery of the award through the ordinary mails, or (2) one working day if the
solicitation states that the contract or notice of award will be transmitted
electronically. (The term "working day" excludes weekends and U.S. Federal
holidays.) If, as so computed, the offered delivery date is later than the
required delivery date, the offer will be considered nonresponsive and rejected.

(End of Clause)

IHD 61 - PLACE OF DELIVERY: DESTINATION (NAVSEA/IHD) FEB 2000

(a)The articles to be furnished hereunder shall be delivered all transportation
charges paid by the contractor to:

               Naval Explosive Ordnance Disposal Technology Division
               Attn: Byron Brezina
               2008 Stump Neck Road, Building 2172
               Indian Head, MD 20640

(b)Bids submitted on a basis other than F.O.B. Destination will be rejected as
non-responsive and proposals may be deemed unacceptable.

IHD 62 - PERIOD OF PERFORMANCE (NAVSEA/IHD) FEB 2000

NSN 7540-01-152-8057          50336-101                OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET      REFERENCE NO. OF DOCUMENT BEING CONTINUED      PAGE
                         N00174-03-D-0003                               24 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

The Basic effort to be performed under this contract, including delivery of
data, shall be completed within a period of 120 months beginning with the
effective date of this contract. The estimated ordering period for each phase is
shown below:

            PHASE I - FROM DATE OF AWARD UNTIL SIX (6) MONTHS AFTER DATE OF
            AWARD (ADC)

            PHASE II - FROM EIGHTEEN (18) MONTHS ADC THROUGH TWENTY-FOUR (24)
            MONTHS ADC

            PHASE III - FROM TWENTY-EIGHT (28) MONTHS ADC THROUGH TEN (10) YEARS
            ADC

                                   (End of Clause)

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET       REFERENCE NO. OF DOCUMENT BEING CONTINUED     PAGE
                          N00174-03-D-0003                              25 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SECTION G Contract Administration Data

ACCOUNTING AND APPROPRIATION DATA

CONTRACT       FUNDING DATA                                            COST CODE

GUARANTEED MINIMUM WILL BE PLACED ON DELIVERY ORDER AT TIME OF AWARD.

CLAUSES INCORPORATED BY REFERENCE:

252.242-7000  Postaward Conference                 DEC 1991

CLAUSES INCORPORATED BY FULL TEXT

NAPS 5252.232-9000 SUBMISSION OF INVOICES (FIXED PRICE) (JUL 1992)

(a)   "Invoice" as used in this clause does not include contractor requests for
      progress payments.

(b)   The contractor shall submit original invoices with copies to the address
      identified in the solicitation/-contract award form (SF 26-Block 10; SF
      33-Block 23; SF 1447-Block 14), unless delivery orders are applicable, in
      which case invoices will be segregated by individual order and submitted
      to the address specified in the order (DD 1155-Block 13 or SF 26-Block
      10).

(c)   The use of copies of the Material Inspection and Receiving Report (MIRR),
      DD Form 250, as an invoice is encouraged. DFARS Appendix F-306 provides
      instructions for such use. Copies of the MIRR used as an invoice are in
      addition to the standard distribution stated in DFARS F-401.

(d)   In addition to the requirements of the Prompt Payment clause of this
      contract, the contractor shall cite on each invoice the contract line item
      number (CLIN); the contract subline item number (SLIN), if applicable; the
      accounting classification reference number (ACRN) as identified on the
      financial accounting data sheets, and the payment terms.

(e)   The contractor shall prepare:

            [X]   a separate invoice for each activity designated to receive the
                  supplies or services.

            [ ]   a consolidated invoice covering all shipments delivered under
                  an individual order.

            [ ]   either of the above.

(f)   If acceptance is at origin, the contractor shall submit the MIRR or other
      acceptance verification directly to the designated payment office. If
      acceptance is at destination, the consignee will forward acceptance
      verification to the designated payment office.

INVOICE MAILING INSTRUCTIONS
                    (To be completed by Contract Specialist)

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110




CONTINUATION SHEET      REFERENCE NO. OF DOCUMENT BEING CONTINUED      PAGE
                         N00174-03-D-0003                               26 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

        MAIL INVOICES TO: DFAS COLUMBUS CENTER
                          DFAS-CO/NORTH ENTITLEMENT OPERATIONS
                          P.O. BOX 182266
                          COLUMBUS, OH 43218-2266

                          NAVAL EXPLOSIVE ORDNANCE DISPOSAL TECHNOLOGY DIVISION
                          ATTN: ELLEN LARISCY
                          2008 STUMP NECK ROAD, BUILDING 2015
                          INDIAN HEAD. MD 20640

                 * Check applicable procedure.
                         (End of clause)

SEA G-L - CONTRACT ADMINISTRATION DATA LANGUAGE (NAVSEA)

(a)Electronic Funds Transfer (EFT) Payment Requirements

FAR 52.232-33, MANDATORY INFORMATION FOR ELECTRONIC FUNDS TRANSFER PAYMENT, is
included in this solicitation/contract. All Contractor payments will be made by
EFT unless excepted or otherwise determined by the paying office designated in
the contract.

The Contractor must initiate enrollment in EFT by contacting the paying office
designated in the contract and requesting form SF 3881, Automated Clearing House
(ACH) Vendor/Miscellaneous Payment Enrollment Plan. This form must be completed
by the Contractor and their financial institution and returned to the paying
office. The paying office will complete the process and notify the Contractor
that EFT enrollment is complete. All payments under this contract will be held
until the Contractor provides the required EFT enrollment information.

(b)Enter below the address (street and number, city, county, state and zip code)
of the Contractor's facility which will administer the contract if such address
is different from the address shown on the SF 26 or SF 33, as applicable.

_______________________________________________________________________________

_______________________________________________________________________________


IHD 76 - INDIAN HEAD DIVISION, NAVAL SEA SYSTEMS COMMAND, HOURS OF OPERATION AND
HOLIDAY SCHEDULE (NAVSEA/IHD) FEB 2000

1. The policy of this station is to schedule periods of reduced operations or
shutdown during holiday periods. Deliveries will not be accepted on Saturdays,
Sundays or Holidays except as specifically requested by the Naval Sea Systems
Command. All goods or services attempted to be delivered on a Saturday, Sunday
or Holiday without specific instructions from the Contracting Officer or his
duly appointed representative will be returned to the contractor at his expense
with no cost or liability to the U.S. Government.

2. The scheduled holidays for Indian Head Division, Naval Sea Systems Command
are:



HOLIDAY              DATE OF OBSERVANCE
- -------              ------------------
                  


NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET      REFERENCE NO. OF DOCUMENT BEING CONTINUED      PAGE
                         N00174-03-D-0003                               27 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP


                              
New Year's Day                   01 January (Tuesday)*
Martin Luther King's Birthday    21 January (Monday)*
President's Day                  18 February (Monday)*
Memorial Day                     28 May (Monday)*
Independence Day                  4 July (Wednesday)*
Labor Day                         3 September (Monday)*
Columbus Day                     15 October (Monday)*
Veteran's Day                    12 November (Monday)*
Thanksgiving Day                 22 November (Thursday)*
Christmas Day                    25 December (Tuesday)*


* If the actual date falls on a Saturday, the holiday will be observed the
preceding Friday. If the holiday falls on a Sunday, the observance shall be on
the following Monday.

3. The hours of operation for the Contracts Division and Receiving Branch are as
follows:



             AREA                         FROM               TO
             ----                         ----               --
                                                   
Contracts Division (BLDG. 1558)         7:30 A.M.         4.00 P.M.

Receiving Branch (BLDG. 116)            7:30 A.M.        11.00 A.M.
                                       12:30 P.M.         2:00 P.M.


If you intend to visit the Contracts Division, it is advised that you call for
an appointment at least 24 hours in advance.

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET      REFERENCE NO. OF DOCUMENT BEING CONTINUED      PAGE
                         N00174-03-D-0003                               28 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

SECTION H Special Contract Requirements

CLAUSES INCORPORATED BY FULL TEXT

IHD 1 - CONTRACTOR PERFORMANCE ASSESSMENT RATING SYSTEM (CPARS) NAVSEA/IHD (JAN
2001)

(a) Pursuant to FAR 42.1502, this contract is subject to DoD's Contractor
Performance Assessment System (CPARS). CPARS is an automated centralized
information system accessible via the Internet that maintains reports of
contractor performance for each contract. CPARS is located at
http://www.nslcptsmh.navsea.navy.mil/. Further information on CPARS is
available at that web-site.

(b) Under CPARS, the Government will conduct annual evaluations of the
contractor's performance. The contractor has thirty (30) days after the
Government's evaluation is completed to comment on the evaluation. The
opportunity to review and comment is limited to this time period and will not be
extended. Failure to review the report at this time will not prevent the
Government from using the report.

(c) The contractor may request a meeting to discuss the CPAR. The meeting is to
be requested via e-mail to the CPARS Program Manager no later than seven days
following receipt of the CPAR. A meeting will then be held during the
contractor's 30-day review period.

(d) The CPARS system requires the Government to assign the contractor a UserlD
and password in order to view and comment on the evaluation. Provide the name(s)
of at least one individual (not more than three) that will be assigned as your
Defense Contractor Representative for CPARS.



       NAME                      PHONE                 E-MAIL ADDRESS (OPTIONAL)
       ----                      -----                 -------------------------
                                                 
__________________        ____________________         _________________________

__________________        ____________________         _________________________

__________________        ____________________         _________________________


                                 (End of Clause)

IHD 91 - ORDERING UNDER MULTIPLE AWARD CONTRACTS (FEB 2000) (NAVSEA/IHD)

In the event that multiple awards result from this solicitation, task orders
will be issued, competed, evaluated and awarded in accordance with the specific
terms and conditions of each delivery order which may include price, past
performance, technical proposal, or a combination thereof. Fair Opportunity to
compete for each individual order need not be given to awardees for a particular
order over $2500.00 due to (1) urgency of the task, (2) quality of past
deliverables or (3) economy/efficiency interests as determined by the
Contracting Officer.

IHD 113 - NOTICE OF INCORPORATION OF SECTIONS K, L, AND M (NAVSEA/IHD) FEB 2000

NSN 7540-01-152-8057         50336-101                 OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET     REFERENCE NO. OF DOCUMENT BEING CONTINUED       PAGE
                        N00174-03-D-0003                                29 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

The following sections of the solicitation will not be distributed with the
contract; however, they are incorporated in and form a part of the resultant
contract as though furnished in full text therewith:



SECTION                                  TITLE
         
K           Representations, Certifications and Other Statements of offerors
            (Bidders)

L           Instructions, Conditions, and Notices to offerors (Bidders)

M           Evaluation Factors for Award


IHD 114 - CONTRACTING OFFICER'S REPRESENTATIVE (COR) (NAVSEA/IHD) FEB 2000

(a) The COR for this contract is:

Name: Byron Brezina
Mailing Address: 2008 Stump Neck Rd., Bldg. 2172, Indian Head, MD 20640
Code: 50     Telephone No.: 301-744-6850, x255

(b) The Alternate COR for this contract is:
Name:
Mailing Address:
Code:        Telephone No.:

(c) The COR will act as the Contracting Officer's representative for technical
matters, providing technical direction and discussion, as necessary, with
respect to the specification or statement of work, and monitoring the progress
and quality of contractor performance. The COR is not an Administrative
Contracting Officer and does not have authority to direct the accomplishment of
effort which is beyond the scope of the statement of work in the contract (or
delivery order).

(d) When, in the opinion of the contractor, the COR requests effort outside the
existing scope of the contract (or delivery order), the contractor shall
promptly notify the contracting officer (or ordering officer) in writing. No
action shall be taken by the contractor under such direction until the
contracting officer has issued a modification to the contract (or in the case of
a delivery order, until the ordering officer has issued a modification to the
delivery order); or until the issue has been otherwise resolved.

(e) In the event that the COR named above is absent due to leave, illness or
official business, all responsibility and functions assigned to the COR will be
the responsibility of the alternate COR.

IHD 125 - TYPES OF DELIVERY ORDERS UNDER INDEFINITE DELIVERY TYPE CONTRACTS (FEB
2000) (NAVSEA/IHD)

(a) The following types of delivery orders will be issued under this contract:
fixed price

SEA H-l - NAVSEA 5252.202-9101 ADDITIONAL DEFINITIONS (MAY 1993)

NSN 7540-01-152-8057           50336-101               OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET       REFERENCE NO. OF DOCUMENT BEING CONTINUED     PAGE
                          N00174-03-D-0003                              30 OF 51

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

As used throughout this contract, the following terms shall have the meanings
set forth below:

(a) DEPARTMENT - means the Department of the Navy.

(b) REFERENCES TO THE FEDERAL ACQUISITION REGULATION (FAR) - All references to
the FAR in this contract shall be deemed to also reference the appropriate
sections of the Defense FAR Supplement (DFARS), unless clearly indicated
otherwise.

(c) REFERENCES TO ARMED SERVICES PROCUREMENT REGULATION OR DEFENSE ACQUISITION
REGULATION - All references in this document to either the Armed Services
Procurement Regulation (ASPR) or the Defense Acquisition Regulation (DAR) shall
be deemed to be references to the appropriate sections of the FAR/DFARS.

(d) NATIONAL STOCK NUMBERS - Whenever the term Federal Item Identification
Number and its acronym FIIN or the term Federal Stock Number and its acronym FSN
appear in the contract, order or their cited specifications and standards, the
terms and acronyms shall be interpreted as National Item Identification Number
(NIIN) and National Stock Number (NSN) respectively which shall be defined as
follows:

      (1) National Item Identification Number (NIIN). The number assigned to
each approved Item Identification under the Federal Cataloging Program. It
consists of nine numeric characters, the first two of which are the National
Codification Bureau (NCB) Code. The remaining positions consist of a seven digit
non-significant number.

      (2) National Stock Number (NSN). The National Stock Number (NSN) for an
item of supply consists of the applicable four position Federal Supply Class
(FSC) plus the applicable nine position NIIN assigned to the item of supply.

SEA H-21 - NAVSEA 5252.216-9110 ORDERS (FIXED-PRICE) (JULY 1999)

(a) General. Orders for supplies or services specified in Section B of the
Schedule may be issued by the Contracting Officer at any time during the
effective period of this agreement. Except as otherwise provided in paragraph
(e) below, the Contractor agrees to accept and perform orders issued by the
Contracting Officer within the scope of this agreement. It is understood and
agreed that the Government has no obligation under the terms of this agreement
to issue any orders. Except as otherwise provided in any order, the Contractor
shall furnish all materials and services necessary to accomplish the work
specified in each order issued hereunder; provided, however, that this agreement
shall not be used for the furnishing of supplies or services which are covered
by any "guaranty" or "warranty" clause(s) of the contract(s) under which the
supplies were manufactured. In the event of any inconsistency between any order
and this agreement, this agreement shall control. All requirements of this
agreement shall be applicable to all orders issued hereunder. Wherever the word
"contract" appears in this agreement, it shall be deemed to include within its
meaning the word "order", and each order shall be considered a separate binding
contract as of its effective date. The Contractor shall segregate the costs
incurred in the performance of any order issued hereunder from the costs of all
other orders issued under this agreement.

(b) Ordering. Orders and revisions thereto shall be made in writing and be
signed by any authorized Contracting Officer cited in paragraph (i). Each order
shall:

NSN 7540-01-152-8057          50336-101                OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
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      (1)   set forth detailed specifications or requirements for the supplies
            or services being ordered, (or reference applicable specifications
            or requirements in Section C of this agreement), and, shall refer to
            the appropriate item under Section B of this agreement;

      (2)   set forth quantities being ordered;

      (3)   set forth preservation, packaging and packing instructions, if any;

      (4)   set forth delivery or performance dates;

      (5)   designate the place(s) where inspection and acceptance will be made
            by the Government;

      (6)   set forth either the firm contract price or, in the case of an
            undefinitized order, the definitization schedule and both the
            monetary limitation on Government liability for the undefinitized
            order and the maximum ceiling amount at which the order may be
            definitized;

      (7)   set forth appropriation and accounting data for the work being
            ordered;

      (8)   set forth any discount offered for prompt payment;

      (9)   be dated;

      (10)  be identified by number in accordance with DFARS 204.7004;

      (11)  set forth the property, if any, to be furnished by the Government
            and the date(s) such property is to be delivered to the Contractor;

      (12)  set forth the disbursing office where payment is to be made and
            other applicable contract administration data;

      (13)  cite the applicable circumstance or exception and the justification
            control number. Orders for items not identified in the class
            justification, or an individual justification, and the basic
            ordering agreement are unauthorized;

      (14)  be issued on an SF 26 or a DD Form 1155; and

      (15)  set forth any other pertinent information.

(c) Firm Priced Orders. Except as otherwise provided in paragraph (d) below, the
Contractor shall not begin any work on an order until a firm priced order is
issued by the Contracting Officer. Upon receipt of a proposed order, the
Contractor shall promptly submit to the Contracting Officer a price proposal for
the work specified in the order. The Contractor agrees that it will submit such
cost or pricing data as the Contracting Officer may require. Promptly after
receipt of the Contractor's proposal and supporting cost or pricing data, the
Contractor and the Contracting Officer shall negotiate and agree upon a price
and delivery schedule for the work being ordered. The price and delivery
schedule, as agreed upon, shall be set forth in the priced order and the order
shall be signed by both the Contracting Officer and the Contractor. Upon receipt
of the priced order, the Contractor shall promptly commence work and shall
diligently complete it.

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110




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(d) Undefinitized Orders. Whenever the Contracting Officer determines that
urgent demands or requirements prevent the issuance of a firm priced order, the
Contracting Officer may issue an unpriced order. Such order may be unilateral or
bilateral and shall establish a limitation on Government liability, a maximum
ceiling amount and a schedule for definitization, as described in subparagraph
(f)(2) below. Upon request, the Contractor shall submit a maximum ceiling amount
proposal before the undefinitized order is issued. The maximum ceiling amount is
the maximum price at which the order may be definitized. Except as provided in
paragraph (e) below, the Contractor shall commence performance of the order upon
receipt. The clause entitled "CONTRACT DEFINITIZATION" (DFARS 252.217-7027)
shall be included in any undefinitized order.

(e) Rejection of Unilateral Orders. The Contractor may reject any unilateral
order if the Contractor determines it cannot feasibly perform the order, or if
it does not concur with the maximum ceiling amount. However, each unilateral
order shall be deemed to have been accepted by the Contractor unless within
fifteen (15) days of issuance of the order the Contractor notifies the
Contracting Officer in writing of its rejection of the order.

(f) Definitization of Undefinitized Orders. (1) The Contractor agrees that
following the issuance of an undefinitized order, it will promptly begin
negotiating with the Contracting Officer the price and terms of a definitive
order that will include: (A) all clauses required by regulation on the date of
the order; (B) all clauses required by law on the date of execution of the
definitive order; and, (C) other mutually agreeable clauses, terms and/or
conditions. No later than sixty (60) days after the undefinitized order is
issued, the Contractor shall submit a cost proposal with sufficient data to
support the accuracy and derivation of its price; and, when required by FAR or
the Contracting Officer, cost or pricing data. If additional cost information is
available prior to the conclusion of negotiations, the Contractor shall provide
that information to the Contracting Officer. The price agreed upon shall be set
forth in a bilateral modification to the order. In no event shall the price
exceed the maximum ceiling amount specified in the undefinitized order.

      (2) Each undefinitized order shall contain a schedule for definitization
which shall include a target date for definitization and dates for submission of
a qualifying proposal, beginning of negotiations and, if appropriate, submission
of make-or-buy and subcontracting plans and cost or pricing data. Submission of
a qualifying proposal in accordance with the definitization schedule is a
material element of the order. The schedule shall provide for definitization of
the order by the earlier of:

            (i)   specified target date which is not more than 180 days after
                  the issuance of the undefinitized order. However, that target
                  date may be extended by the Contracting Officer for up to 180
                  days after the Contractor submits a qualifying proposal as
                  defined in DFARS 217.7401; or

            (ii)  the date on which the amount of funds obligated by the
                  Government under the undefinitized order exceeds fifty percent
                  (50%) of the order's maximum ceiling amount, except as
                  provided in subparagraph (f)(3) below.

      (3) If agreement on a definitive order is not reached within the time
provided pursuant to subparagraph (f)(2) above, the Contracting Officer may,
with the approval of the Head of the Contracting Activity, determine a
reasonable price in accordance with Subpart 15.8 and Part 31 of the FAR, and
issue a unilateral order subject to Contractor appeal as provided in the
"DISPUTES" clause (FAR 52.233-1). In any event, the Contractor shall proceed
with completion of the order, subject to the "LIMITATION OF GOVERNMENT
LIABILITY" clause (FAR 52.216-24).

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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(g) Limitation of Government Liability. (1) Each undefinitized order shall set
forth the limitation of Government liability, which shall be the maximum amount
that the Government will be obligated to pay the Contractor for performance of
the order until the order is definitized. The Contractor is not authorized to
make expenditures or incur obligations exceeding the limitation of Government
liability set forth in the order. If such expenditures are made, or if such
obligations are incurred, those expenditures and obligations will be at the
Contractor's sole risk and expense. Further, the limitation of liability shall
be the maximum Government liability if the order is terminated. The clause at
FAR 52.216-24 shall be included in any undefinitized order.

      (2) Except for undefinitized orders for Foreign Military Sales; purchases
of less than $25,000; special access programs; and Congressionally-mandated long
lead procurements; and except as otherwise provided in subparagraph (g)(3)
below, the limitation of Government liability shall not exceed fifty percent
(50%) of the maximum ceiling amount of an undefinitized order. In the case of
orders within these excepted categories, however, the procedures set forth
herein shall be followed to the maximum extent practical.

      (3) If the Contractor submits a qualifying proposal, as defined in DFARS
217.7401, to definitize an order before the Government obligated fifty percent
(50%) of the maximum ceiling amount, the Contracting Officer may increase the
limitation of Government liability up to no more than seventy-five percent (75%)
of the maximum ceiling amount or up to seventy-five percent (75%) of the price
proposed by the Contractor, whichever is less.

      (4) If at any time the Contractor believes that its expenditures under an
order will exceed the limitation of Government liability, the Contractor shall
so notify the Contracting Officer, in writing, and propose an appropriate
increase in the limitation of Government liability of such order. Within thirty
(30) days of such notice, the Contracting Officer will either (i) notify the
Contractor in writing of such appropriate increase, or (ii) instruct the
Contractor how and to what extent the work shall be continued; provided,
however, that in no event shall the Contractor be obligated to proceed with work
on an undefinitized order beyond the point where its costs incurred plus a
reasonable profit exceed the limitation of Government liability, and provided
also that in no event shall the Government be obligated to pay the Contractor
any amount in excess of the limitation of Government liability specified in any
such order prior to definitization.

(h) Initial Spares. The limitations set forth in paragraph (d) and subparagraphs
(f)(2), (g)(2) and (g)(3), do not apply to undefinitized orders for the purchase
of initial spares.

(i) Ordering Activities. The following activities are authorized to issue orders
hereunder:

The Contracting Officer of the Ordering Activity shall forward a copy of each
executed order marked "DD-350", to the Commander, Naval Sea Systems Command,
ATTN: SEA 0293.

(j) Funds in the following amount are committed under this Basic Ordering
Agreement for use by the Ordering Activity in obligating funds to pay for orders
placed hereunder:


                  
Item                 Funds


The Contracting Officer of the Ordering Activity shall forward a copy of each
executed order marked ADD-350(congruents), to the Commander, Naval Sea Systems
Command, ATTN: SEA 0294.

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
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SECTION I Contract Clauses

CLAUSES INCORPORATED BY REFERENCE:


                                                                          
52.202-1        Definitions                                                     DEC 2001
52.203-3        Gratuities                                                      APR 1984
52.203-5        Covenant Against Contingent Fees                                APR 1984
52.203-6 Alt I  Restrictions On Subcontractor Sales To The Government (Jul      OCT 1995
                1995)-- Alternate I
52.203-7        Anti-Kickback Procedures                                        JUL 1995
52.203-8        Cancellation, Rescission, and Recovery of Funds for Illegal or  JAN 1997
                Improper Activity
52.203-12       Limitation On Payments To Influence Certain Federal             JUN 1997
                Transactions
52.204-4        Printed or Copied Double-Sided on Recycled Paper                AUG 2000
52.208-9        Contractor Use of Mandatory Sources of Supply or Services       FEB 2002
52.209-6        Protecting the Government's Interest When Subcontracting With   JUL 1995
                Contractors Debarred, Suspended, or Proposed for Debarment
52.211-15       Defense Priority And Allocation Requirements                    SEP 1990
52.215-8        Order of Precedence--Uniform Contract Format                    OCT 1997
52.219-6        Notice Of Total Small Business Set-Aside                        JUL 1996
52.219-8        Utilization of Small Business Concerns                          OCT 2000
52.219-14       Limitations On Subcontracting                                   DEC 1996
52.222-3        Convict Labor                                                   AUG 1996
52.222-21       Prohibition Of Segregated Facilities                            FEB 1999
52.222-26       Equal Opportunity                                               FEB 1999
52.222-35       Equal Opportunity For Disabled Veterans, Veterans of the        DEC 2001
                Vietna Era and Other Eligible Veterans
52.222-36       Affirmative Action For Workers With Disabilities                JUN 1998
52.222-37       Employment Reports On Special Disabled Veterans, Veterans Of    DEC 2001
                The Vietnam Era and Other Eligible Veterans
52.223-10       Waste Reduction Program                                         AUG 2000
52.223-14       Toxic Chemical Release Reporting                                OCT 2000
52.225-8        Duty-Free Entry                                                 FEB 2000
52.225-13       Restrictions on Certain Foreign Purchases                       JUL 2000
52.226-1        Utilization Of Indian Organizations And Indian-Owned Economic   JUN 2000
                Enterprises
52.227-1        Authorization and Consent                                       JUL 1995
52.227-2        Notice And Assistance Regarding Patent And Copyright            AUG 1996
                Infringement
52.229-3        Federal, State And Local Taxes                                  JAN 1991
52.229-5        Taxes--Contracts Performed In U S Possessions Or Puerto Rico    APR 1984
52.232-1        Payments                                                        APR 1984
52.232-8        Discounts For Prompt Payment                                    FEB 2002
52.232-11       Extras                                                          APR 1984
52.232-17       Interest                                                        JUN 1996


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                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110




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52.232-23       Assignment Of Claims                                            JAN 1986
52.232-25       Prompt Payment                                                  FEB 2002
52.232-33       Payment by Electronic Funds Transfer--Central Contractor        MAY 1999
                Registration
52.233-1 Alt I  Disputes (Dec 1998) - Alternate I                               DEC 1991
52.233-3        Protest After Award                                             AUG 1996
52.242-13       Bankruptcy                                                      JUL 1995
52.243-1        Changes--Fixed Price                                            AUG 1987
52.247-63       Preference For U.S. Flag Air Carriers                           JAN 1997
52.249-2        Termination For Convenience Of The Government (Fixed-Price)     SEP 1996
52.249-8        Default (Fixed-Price Supply & Service)                          APR 1984
52.251-1        Government Supply Sources                                       APR 1984
52.253-1        Computer Generated Forms                                        JAN 1991
252.203-7001    Prohibition On Persons Convicted of Fraud or Other Defense-     MAR 1999
                Contract-Related Felonies
252.203-7002    Display Of DOD Hotline Poster                                   DEC 1991
252.204-7002    Payment For Subline Items Not Separately Priced                 DEC 1991
252.204-7003    Control Of Government Personnel Work Product                    APR 1992
252.204-7004    Required Central Contractor Registration                        NOV 2001
252.205-7000    Provisions Of Information To Cooperative Agreement Holders      DEC 1991
252.209-7004    Subcontracting With Firms That Are Owned or Controlled By The   MAR 1998
                Government of a Terrorist Country
252.225-7001    Buy American Act And Balance Of Payments Program                MAR 1998
252.225-7002    Qualifying Country Sources As Subcontractors                    DEC 1991
252.225-7009    Duty-Free Entry--Qualifying Country Supplies (End Products and  AUG 2000
                Components)
252.225-7010    Duty-Free Entry--Additional Provisions                          AUG 2000
252.225-7012    Preference For Certain Domestic Commodities                     AUG 2000
252.225-7031    Secondary Arab Boycott Of Israel                                JUN 1992
252.225-7043    Antiterrorism/Force Protection Policy for Defense Contractors   JUN 1998
                Outside the United States
252.226-7001    Utilization of Indian Organizations and Indian-Owned Economic   SEP 2001
                Enterprises-DoD Contracts
252.227-7013    Rights in Technical Data--Noncommercial Items                   NOV 1995
252.227-7014    Rights in Noncommercial Computer Software and Noncommercial     JUN 1995
                Computer Software Documentation
252.227-7016    Rights in Bid or Proposal Information                           JUN 1995
252.227-7019    Validation of Asserted Restrictions--Computer Software          JUN 1995
252.227-7030    Technical Data--Withholding Of Payment                          MAR 2000
252.227-7036    Declaration of Technical Data Conformity                        JAN 1997
252.227-7037    Validation of Restrictive Markings on Technical Data            SEP 1999
252.243-7001    Pricing Of Contract Modifications                               DEC 1991
252.243-7002    Requests for Equitable Adjustment                               MAR 1998
252.246-7000    Material Inspection And Receiving Report                        DEC 1991
252.247-7023    Transportation of Supplies by Sea                               MAR 2000
252.247-7024    Notification Of Transportation Of Supplies By Sea               MAR 2000


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CLAUSES INCORPORATED BY FULL TEXT

52.216-18 - ORDERING (OCT 1995)

(a) Any supplies and services to be furnished under this contract shall be
ordered by issuance of delivery orders or task orders by the individuals or
activities designated in the Schedule. Such orders may be issued from date of
award through ten (10) years thereafter. The ordering period for Phase I shall
be from date of award until six (6) months after date of contract (ADC). The
ordering period for Phase II shall be from eighteen (18) months ADC through
twenty-four (24) months ADC. The ordering period for Phase III shall be from
twenty-eight (28) months ADC through ten (10) years ADC.

(b) All delivery orders or task orders are subject to the terms and conditions
of this contract. In the event of conflict between a delivery order or task
order and this contract, the contract shall control.

(c) If mailed, a delivery order or task order is considered "issued" when the
Government deposits the order in the mail. Orders may be issued orally, by
facsimile, or by electronic commerce methods only if authorized in the Schedule.

                                (End of clause)

52.216-19 ORDER LIMITATIONS. (OCT 1995)

(a) Minimum order. When the Government requires supplies or services covered by
this contract in an amount of less than CLINs 0001 through 0009, the Government
is not obligated to purchase, nor is the Contractor obligated to furnish, those
supplies or services under the contract.

(b) Maximum order. The Contractor is not obligated to honor:

(1) Any order for a single item in excess of 250 units (insert dollar figure or
quantity);

(2) Any order for a combination of items in excess of 250 production units
(insert dollar figure or quantity); or

(3) A series of orders from the same ordering office within 30days that together
call for quantities exceeding the limitation in subparagraph (1) or (2) above.

(c) If this is a requirements contract (i.e., includes the Requirements clause
at subsection 52.216-21 of the Federal Acquisition Regulation (FAR)), the
Government is not required to order a part of any one requirement from the
Contractor if that requirement exceeds the maximum-order limitations in
paragraph (b) above.

(d) Notwithstanding paragraphs (b) and (c) above, the Contractor shall honor any
order exceeding the maximum order limitations in paragraph (b), unless that
order (or orders) is returned to the ordering office within 10days after
issuance, with written notice stating the Contractor's intent not to ship the
item (or items) called for and the reasons. Upon receiving this notice, the
Government may acquire the supplies or services from another source.

(End of clause)

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110




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52.216-22 INDEFINITE QUANTITY. (OCT 1995)

(a) This is an indefinite-quantity contract for the supplies or services
specified, and effective for the period stated, in the Schedule. The quantities
of supplies and services specified in the Schedule are estimates only and are
not purchased by this contract.

(b) Delivery or performance shall be made only as authorized by orders issued in
accordance with the Ordering clause. The Contractor shall furnish to the
Government, when and if ordered, the supplies or services specified in the
Schedule up to and including the quantity designated in the Schedule as the
"maximum". The Government shall order at least the quantity of supplies or
services designated in the Schedule as the "minimum".

(c) Except for any limitations on quantities in the Order Limitations clause or
in the Schedule, there is no limit on the number of orders that may be issued.
The Government may issue orders requiring delivery to multiple destinations or
performance at multiple locations.

(d) Any order issued during the effective period of this contract and not
completed within that period shall be completed by the Contractor within the
time specified in the order. The contract shall govern the Contractor's and
Government's rights and obligations with respect to that order to the same
extent as if the order were completed during the contract's effective period;
provided, that the Contractor shall not be required to make any deliveries under
this contract after 120 days after expiration date of the contract.

(End of clause)

52.223-11 OZONE-DEPLETING SUBSTANCES (MAY 2001)

(a) Definition. Ozone-depleting substance, as used in this clause, means any
substance the Environmental Protection Agency designates in 40 CFR part 82 as--

(1) Class I, including, but not limited to, chlorofluorocarbons, halons, carbon
tetrachloride, and methyl chloroform; or

(2) Class II, including, but not limited to, hydrochlorofluorocarbons.

(b) The Contractor shall label products which contain or are manufactured with
ozone-depleting substances in the manner and to the extent required by 42 U.S.C.
7671j (b), (c), and (d) and 40 CFR Part 82, Subpart E, as follows:

"WARNING: Contains (or manufactured with, if applicable), a substance(s) which
harm(s) public health and environment by destroying ozone in the upper
atmosphere."----------------------

The Contractor shall insert the name of the substance(s).

(End of clause)

52.252-2 CLAUSES INCORPORATED BY REFERENCE (FEB 1998)

This contract incorporates one or more clauses by reference, with the same force
and effect as if they were given in full text. Upon request, the Contracting
Officer will make their full text available. Also, the full text of a clause may
be accessed electronically at this/these address(es):

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                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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            http://www.arnet.gov/far/

            http://www.acq.osd.mil/dp/dars/dfars/dfars.html

252.225-7008 SUPPLIES TO BE ACCORDED DUTY-FREE ENTRY (MAR 1998)

In accordance with paragraph (b) of the Duty-Free Entry clause of this contract,
in addition to duty-free entry for all qualifying country supplies (end products
and components) and all eligible end products subject to applicable trade
agreements (if this contract contains the Buy American Act--Trade
Agreements--Balance of Payments Program clause or the Buy American Act--North
American Free Trade Agreement Implementation Act--Balance of Payments Program
clause), the following foreign end products that are neither qualifying country
end products nor eligible end products under a trade agreement, and the
following nonqualifying country components, are accorded duty-free entry.

(End of Clause)

252.251-7000 ORDERING FROM GOVERNMENT SUPPLY SOURCES (MAY 1995)

(a) When placing orders under Federal Supply Schedules or Personal Property
Rehabilitation Price Schedules, the Contractor shall follow the terms of the
applicable schedule and authorization. Include in each order:

(1) A copy of the authorization (unless a copy was previously furnished to the
Federal Supply Schedule or Personal Property Rehabilitation Price Schedule
contractor).

(2) The following statement:

This order is placed under written authorization from     dated      . In
the event of any inconsistency between the terms and conditions of this order
and those of your Federal Supply Schedule contract or Personal Property
Rehabilitation Price Schedule contract, the latter will govern.

(3) The completed address(es) to which the Contractor's mail, freight, and
billing documents are to be directed.

(b) If a Federal Supply Schedule contractor refuses to honor an order placed by
a Government contractor under an agency authorization, the Contractor shall
report the circumstances to the General Services Administration, FFN,
Washington, DC 20406, with a copy to the authorizing office.

(c) When placing orders under nonmandatory schedule contracts and requirements
contracts, issued by the General Services Administration (GSA) Office of
Information Resources Management, for automated data processing equipment,
software and maintenance, communications equipment and supplies, and
teleprocessing services, the Contractor shall follow the terms of the applicable
contract and the procedures in paragraph (a) of this clause.

(d) When placing orders for Government stock, the Contractor shall --

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                                                      Sponsored by GSA
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(1) Comply with the requirements of the Contracting Officer's authorization,
using FEDSTRIP or MILSTRIP procedures, as appropriate;

(2) Use only the GSA Form 1948-A, Retail Services Shopping Plate, when ordering
from GSA Self-Service Stores;

(3) Order only those items required in the performance of Government contracts;
and

(4) Pay invoices from Government supply sources promptly. For purchases made
from DoD supply sources, this means within 30 days of the date of a proper
invoice (see also Defense Federal Acquisition Regulation Supplement (DFARS)
251.105). For purposes of computing interest for late Contractor payments, the
Government's invoice is deemed to be a demand for payment in accordance with the
Interest clause of this contract. The Contractor's failure to pay may also
result in the DoD supply source refusing to honor the requisition (see DFARS
251.102(f)) or in the Contracting Officer terminating the Contractor's
authorization to use DoD supply sources. In the event the Contracting Officer
decides to terminate the authorization due to the Contractor's failure to pay in
a timely manner, the Contracting Officer shall provide the Contractor with
prompt written notice of the intent to terminate the authorization and the basis
for such action. The Contractor shall have 10 days after receipt of the
Government's notice in which to provide additional information as to why the
authorization should not be terminated. Such termination shall not provide the
Contractor with an excusable delay for failure to perform or complete the
contract in accordance with the terms of the contract, and the Contractor shall
be solely responsible for any increased costs.

(e) Only the Contractor may request authorization for subcontractor use of
Government supply sources. The Contracting Officer will not grant authorizations
for subcontractor use without approval of the Contractor.

(f) Government invoices shall be submitted to the Contractor's billing address,
and Contractor payments shall be sent to the Government remittance address
specified below:

Contractor's Billing Address [include point of contact and telephone number]:

Government Remittance Address [include point of contact and telephone number]:

(End of clause)

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                                                      Sponsored by GSA
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SECTION J List of Documents, Exhibits and Other Attachments

Attachment A - Performance Specification

Attachment B - Contract Administration Plan

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                           PERFORMANCE SPECIFICATION
                                    FOR THE
                        MAN TRANSPORTABLE ROBOTIC SYSTEM

                                    1. SCOPE

This performance specification contains the complete requirements for the Man
Transportable Robotic System (MTRS), including interface characteristics and
quality assurance provisions.

                             2. SYSTEM REQUIREMENTS

2.1 SYSTEM DESCRIPTION

The purpose of the MTRS is to complement/augment the military EOD technician
when performing reconnaissance during extremely hazardous EOD missions involving
unexploded ordnance (UXO) and improvised explosive devices (IEDs). The MTRS will
provide the operator with good situational awareness(1) of the area that is
being reconnoitered. The major components of the MTRS will be a remote
controlled vehicle and an operator control station (OCS). Communication between
the OCS and the vehicle shall be accomplished in both a wireless mode and a
cabled mode. The vehicle will be composed of a teleoperated(2) platform and a
teleoperated robotic manipulator. The vehicle shall incorporate industry
standard communication ports to enable interoperability with various sensors in
future system upgrades that will enhance the reconnaissance capabilities of the
MTRS. The MTRS shall also have an integrated firing circuit to enable
interoperability with explosive EOD tools in future system upgrades that will
add render safe, disruption, and disposal capabilities to the MTRS.

2.2 CHARACTERISTICS

2.2.1 PERFORMANCE CHARACTERISTICS.

      2.2.1.1 VEHICLE SIZE. The vehicle size shall be such that the vehicle can
travel through a door opening with a clear width of 25 inches and turn into a
corridor with a width of 36 inches. The capability of the vehicle to travel down
passageways with a width of 18 inches is desired.

      2.2.1.2 VEHICLE MOBILITY.

Note: The vehicle shall meet the specifications contained in sections 2.2.1.2.1
through and including 2.2.1.2.10 while carrying a 10 pound payload that is
located as close as possible to the center of gravity of the vehicle.

Note: Modular mobility aids may be used to enhance vehicle performance for
specific mobility specifications. However, the vehicle, without any modular
mobility aids, shall meet the specifications contained in sections

- ------------------
(1)Situational awareness refers to the degree of accuracy by which the
operator's perception of the environment surrounding the vehicle mirrors reality

(2)Teleoperation implies the presence of a human being in the control loop

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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2.2.1.2.1, 2.2.1.2.5, 2.2.1.3, and 2.2.1.6. Mobility aids, if any, shall be
modular with respect to the vehicle platform, requiring no more than five
minutes to install or remove without the use of tools.

            2.2.1.2.1 STAIRS. The vehicle shall be capable of climbing the
following stair types:

                  -     Wooden Residential Stairs - Consists of 13 steps in a
                        straight flight with 8.25 inch risers and 9 inch treads
                        (43 degree climb angle). Stair width is 36 inches.

                  -     Carpeted Wooden Residential Stairs - Consists of five
                        steps in a straight flight, a quarter landing, and eight
                        steps in a straight flight. Stair width is 36 inches
                        with 7.75 inch risers and 10 inch treads (38 degree
                        climb angle). All stairs and landing are carpeted.

                  -     Commercial Building Stairs - Consists of 13 steps in a
                        straight flight, a half landing, and 10 steps in a
                        straight flight. Stair width is 42 inches with 7 inch
                        risers and 11 inch treads (32 degree climb angle). Tread
                        surface is finished masonry with anti-skid nosings.

The capability to climb 36 inch wide wooden stairs with 10 inch risers and 5.75
inch treads (60 degree climb angle) is desired.

            2.2.1.2.2 SLOPES (CLIMB). The vehicle shall be capable of climbing a
45 degree dry grass-covered slope. The capability to climb a 60 degree dry
grass-covered slope is desired.

            2.2.1.2.3 SLOPES (TRAVERSE). The vehicle shall be capable of
traversing a 30 degree dry grass-covered slope. The capability to traverse a 45
degree dry grass-covered slope is desired.

            2.2.1.2.4 SNOW. The vehicle shall be capable of maneuvering in snow
that is 2 inches deep. The capability to maneuver in snow that is 6 inches deep
is desired.

            2.2.1.2.5 CURB. The vehicle shall have the capability to maneuver
over a 6 inch concrete curb. The capability to maneuver over a 12 inch concrete
curb is desired.

            2.2.1.2.6 RUBBLE/DEBRIS. The vehicle shall have the capability to
maneuver on rubble/debris with an average diameter of 4 inches. The capability
to maneuver on rubble/debris with an average diameter of 8 inches is desired.

            2.2.1.2.7 SAND. The vehicle shall have the capability to maneuver on
unpacked sand that is 2 inches deep. The capability to maneuver on unpacked sand
that is 6 inches deep is desired.

            2.2.1.2.8 HIGH GRASS. The vehicle shall have the capability to
maneuver in grass that is 6 inches high. The capability to maneuver in grass
that is 12 inches high is desired.

            2.2.1.2.9 SHALLOW WATER. The vehicle shall have the capability to
maneuver in standing water that is 4 inches deep. The capability to maneuver in
standing water that is 6 inches deep is desired.

            2.2.1.2.10 MUD. The vehicle shall have the capability to maneuver in
mud.

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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      2.2.1.3 ENDURANCE. The vehicle and OCS, while being powered by internal
power sources such as batteries, shall be capable of two hours of continuous
operation when being operated against the following endurance profile in
wireless mode and cabled mode:

            -     Drive vehicle 800 meters on a dirt road with three neutral
                  clockwise 180 degree turns and four neutral counterclockwise
                  180 degree turns over a 20 minute period.

            -     Perform reconnaissance in search area along dirt path in
                  wooded area for 50 minutes. Search area is 100 meters long by
                  20 meters wide. Reconnaissance of certain targets to involve
                  manipulator usage.

            -     Grasp a target with the manipulator, transport target a
                  distance of 100 meters, and place target over a period of 10
                  minutes.

            -     Monitor roadway with vehicle stationary (camera movements
                  only) for 20 minutes.

            -     Drive vehicle 800 meters on a level dirt road with four
                  neutral clockwise 180 degree turns and three neutral
                  counterclockwise 180 degree turns over a 20 minute period.

The vehicle shall meet the endurance specification while carrying a 10 pound
payload that is located as close as possible to the center of gravity of the
vehicle. The capability to continuously operate the vehicle and OCS for four
hours (two consecutive endurance profiles with no battery changeout or
recharging) is desired.

      2.2.1.4 RANGE.

            2.2.1.4.1 WIRELESS MODE. When being operated in wireless mode, the
maximum range of operation between the vehicle and the OCS shall be no less than
800 meters (line of sight). A range of 2000 meters is desired. No performance
degradation (e.g. loss of vehicle control, loss of vehicle functions, loss of
video, loss of audio) shall occur when the vehicle is at the maximum range or at
any distance (line of sight) that is less than the maximum range. The operating
frequencies used shall fall into one or more of the following frequency bands:

                  -     138 MHz - 144 MHz (Narrowband - Occupied Bandwidth less
                        than or equal to 12.5 kHz)

                  -     148 MHz - 149.9 MHz (Narrowband - Occupied Bandwidth
                        less than or equal to 12.5 kHz)

                  -     150.05 MHz - 150.8 MHz (Narrowband - Occupied Bandwidth
                        less than or equal to 12.5 kHz)

                  -     1755 MHz - 1850 MHz

                  -     4400 MHz - 4990 MHz

The capability to independently operate two systems simultaneously in wireless
mode in the same location is desired.

            2.2.1.4.2 CABLED MODE. When being operated in cabled mode (e.g.
fiber optic, coaxial, multi-conductor), the maximum amount of cable that can be
deployed between the vehicle and the OCS shall be no less than 200 meters. The
desired maximum amount of cable is 500 meters. An indication shall be provided
to warn the operator when 20 meters of cable or less remains to be payed out. A
conspicuous marking of the cable that can be viewed with a vehicle camera is a
sufficient indication. The cable shall be stored on the vehicle and be capable
of paying out freely from the vehicle. A self-reeling mechanism for cable
retrieval located on the vehicle that can be controlled from the OCS during a
mission is desired. If such a self-reeling mechanism is not provided on the
vehicle, then a manual or powered reeling mechanism shall be provided at the OCS
to facilitate the retrieval of cable during

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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a mission. A means to facilitate the manual retrieval of cable onto the vehicle
after a mission shall be provided. The capability to lower, lift, and drag the
vehicle by the cable (without damaging the cable) is desired.

      2.2.1.5 PORTABILITY.

            2.2.1.5.1 MAN TRANSPORTABILITY. All components of the system
necessary to conduct 2 two-hour missions (as outlined in 2.2.1.3 with one in
wireless mode and one in cabled mode) shall weigh no more than 145 pounds and
shall be capable of being transported a distance of 500 meters in semi-rugged
terrain as one load by two personnel in one trip. The entire weight of the load
shall be borne by the two personnel. A weight of no more than 75 pounds (vice
145 pounds) is desired. A load carrying apparatus that combines stretcher type
handles and shoulder support is recommended, but not required, to facilitate
transporting the load. Any load carrying apparatus shall be considered to be
part of the system and the weight of such apparatus shall be included in the 145
pound weight limit. Any modular vehicle mobility aids shall also be included in
the 145 pound weight limit. The load carrying apparatus, if provided, shall be
capable of supporting 160 pounds (which includes the weight of the apparatus
itself) to allow for an additional 15 pounds of weight associated with future
system upgrades.

            2.2.1.5.2 VEHICLE HANDLING. The vehicle shall have handles or other
suitable means (which can be permanently attached or detachable) to facilitate
convenient grasping, handling, and carrying by personnel.

      2.2.1.6 VEHICLE SPEED. The vehicle shall be capable of reaching and
maintaining a maximum speed of no less than 2.5 miles per hour on a hard dry
level surface. Control of the vehicle speed between zero and the maximum speed
shall be continuously variable. The vehicle shall meet the speed specification
while carrying a 10 pound payload that is located as close as possible to the
center of gravity of the vehicle. The capability to reach and maintain a maximum
speed of 5 miles per hour is desired.

      2.2.1.7 MANIPULATOR

            2.2.1.7.1 MANIPULATOR DEXTERITY. The manipulator shall have at least
the following two degrees of freedom:

         -     Shoulder pitch

         -     Elbow pitch

The manipulator shall have an end effector (gripper) that is capable of grasping
small UXO such as submunitions, grenades, and projectiles less than 4 inches in
diameter and small IEDs such as pipe bombs.

A manipulator with the following six degrees of freedom is desired:

         -     Shoulder pitch

         -     Shoulder yaw

         -     Elbow pitch

         -     Wrist pitch

         -     Wrist yaw

         -     Wrist roll

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110




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            2.2.1.7.2 MANIPULATOR LIFT. The manipulator shall be capable of
lifting a 15 pound cylindrical load and securely holding the load while the
vehicle travels a distance of 800 meters. The capability to lift and securely
hold a 30 pound load is desired.

            2.2.1.7.3 MANIPULATOR MODULARITY. The manipulator shall be modular
with respect to the vehicle platform, requiring no more than five minutes to
install or remove without the use of tools.

      2.2.1.8 SET-UP.

            2.2.1.8.1 PREPARATION FOR OPERATION OUT OF SHIPPING CONTAINERS. The
system shall be capable of being prepared for wireless mode and cabled mode
operation out of the shipping containers in no more than ten minutes using
common hand tools. Pre-operational checks are considered to be part of
preparation for operation. The capability to prepare the system for operation in
no more than five minutes without the use of tools is desired.

            2.2.1.8.2 PREPARATION FOR MAN TRANSPORT OUT OF SHIPPING CONTAINERS.
The system shall be capable of being prepared for man transport (see 2.2.1.5.1)
out of the shipping containers in no more than ten minutes using common hand
tools. Pre-operational checks that are necessary prior to man transport are
considered to be part of preparation for man transport. The capability to
prepare the system for man transport in no more than five minutes without the
use of tools is desired.

            2.2.1.8.3 PREPARATION FOR OPERATION AFTER MAN TRANSPORT. The system
shall be capable of being prepared for wireless mode and cabled mode operation
after man transport in no more than five minutes using common hand tools.
Pre-operational checks are considered to be part of preparation for operation.
The capability to prepare the system for operation after man transport in no
more than two minutes without the use of tools is desired.

      2.2.1.9 TURN-AROUND.

            2.2.1.9.1 VEHICLE BATTERY(IES) CHANGEOUT. The batteries in the
vehicle shall be capable of being replaced in no more than two minutes without
the use of tools. The capability to replace the vehicle batteries in no more
than one minute without the use of tools is desired.

            2.2.1.9.2 OPERATOR CONTROL STATION BATTERY(IES) CHANGEOUT. The
batteries in the OCS shall be capable of being replaced in no more than two
minutes without the use of tools. The capability to replace the OCS batteries in
no more than one minute without the use of tools is desired.

            2.2.1.9.3 POST-MISSION TURN-AROUND. The system shall be capable of
being "turned-around" (prepared for next mission) in no more than ten minutes
using common hand tools. Any post-operational checks are considered to be part
of the turn-around. The capability to turn-around the system in no more than
five without the use of tools is desired.

      2.2.1.10 VIDEO. The video displayed at the OCS from the vehicle shall
provide the operator with good situational awareness of the area being
reconnoitered. The displayed video is the main feedback the operator will use to
locate, examine, and identify UXO and IEDs as well as to maneuver the vehicle
and operate the manipulator. No minimum number of vehicle cameras is specified
herein in order to provide sufficient video to accomplish the tasks mentioned
above. However, all camera views provided shall be able to be viewed
simultaneously at the OCS and at least one vehicle camera shall have the
following characteristics:

         -     Camera is not attached to the manipulator

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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         -     Capable of being remotely positioned at least 3 feet from the
               ground

         -     Continuous pan capability

         -     Tilt capability of+/-90 degrees from horizontal

         -     Automatic focus with manual override

         -     Automatic iris with manual override

         -     20x optical (or greater)/100x digital (or greater) manual zoom
               capability

         -     Automatic image stabilization

The video displayed at the OCS shall be capable of being recorded by an external
video recording device.

      2.2.1.11 AUDIO. The MTRS shall have a two-way audio capability between the
OCS and vehicle that is capable of being recorded by an external audio recording
device.

      2.2.1.12 ILLUMINATION. Illumination sources shall be provided on the
vehicle to ensure effective camera operation in all lighting conditions. The
intensity of the illumination sources shall be manually adjustable from the OCS
with at least three intensity settings between off and full.

      2.2.1.13 JOINT ARCHITECTURE FOR UNMANNED GROUND SYSTEMS (JAUGS). The MTRS
shall comply with the Joint Architecture for Unmanned Ground Systems Reference
Architecture Specification version 2.0.

      2.2.1.14 FIRING CIRCUIT. The MTRS shall contain a safety critical firing
circuit that is capable of initiating electro-explosive devices such as squibs
and blasting caps. The output of the firing circuit shall terminate in two
suitable terminal posts in an accessible location on the vehicle. The firing
circuit shall be capable of providing no less than 2.43 amperes of direct
current. The output voltage of the firing circuit shall be no less than 14 volts
and no greater than 28 volts. Functioning of the firing circuit shall require a
unique sequence of events to be performed at the OCS by the operator. See
2.2.8.2.

      2.2.1.15 RELIABILITY. The MTRS shall have a Mean Time Between Operational
Mission Failures (MTBOMF) of at least 9.0 hours. An operational mission failure
is one that precludes successful completion of a mission. An MTBOMF of at least
19.0 hours is desired.

      2.2.1.16 MAINTAINABILITY. The MTRS shall have a Mean Corrective
Maintenance Time for Operational Mission Failures (MCMTOMF) of no more than 2
hours. The MCMTOMF is the average time required to perform corrective
maintenance at the organizational level.

2.2.2 PHYSICAL CHARACTERISTICS

      2.2.2.1 SIZE.

            2.2.2.1.1 SYSTEM SIZE The entire system shall be capable of being
stored and shipped in no more than two shipping containers. The total of the
length plus the girth of each shipping container shall not exceed 130 inches.

            2.2.2.1.2 VEHICLE SIZE. The size of the vehicle is subject to the
specifications in 2.2.1.1 and 2.2.2.1.1.

            2.2.2.1.3 OCS SIZE. The size of the OCS is subject to the
specifications in 2.2.2.1.1.

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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      2.2.2.2 WEIGHT.

            2.2.2.2.1 SYSTEM WEIGHT. When the MTRS is stored in its shipping
container(s), no shipping container shall weigh more than 150 pounds. The
maximum weight of the system (including the shipping containers) shall therefore
be no greater than 300 pounds, given that a maximum of two shipping containers
are allowed as stated in 2.2.2.1.1. The desired weight for each shipping
container is no more than 84 pounds.

            2.2.2.2.2 VEHICLE WEIGHT. The weight of the vehicle is subject to
the specifications in 2.2.1.5.1 and 2.2.2.2.1.

            2.2.2.2.3 OCS WEIGHT. The weight of the OCS is subject to the
specifications in 2.2.1.5.1 and 2.2.2.2.1.

2.2.3 INTERFACE REQUIREMENTS.

      2.2.3.1 RS-232 DATA INTERFACE. The vehicle shall have two accessible
RS-232 data ports.

      2.2.3.2 UNIVERSAL SERIAL BUS (USB) INTERFACE. The vehicle shall have one
accessible Universal Serial Bus data port.

      2.2.3.3 POWER.

            2.2.3.3.1 OCS POWER. The OCS shall be capable of being powered by
120 VAC 60 Hz.

            2.2.3.3.2 BATTERY CHARGERS. Any battery chargers used in the MTRS
shall be capable of being powered from 120 VAC 60 Hz and 240 VAC 50 Hz.

2.2.4 ENVIRONMENTAL CONDITIONS.

      2.2.4.1 STORAGE TEMPERATURE. The MTRS, with the exception of batteries and
the OCS, shall perform satisfactorily after being stored in temperatures from
- -40 degrees F (-40 degrees C) to +160 degrees F (+71 degrees C). The OCS shall
perform satisfactorily after being stored in temperatures from +32 degrees F
(0 degrees C) to +110 degrees F (+43 degrees C). Any batteries used in the MTRS
shall withstand storage temperatures of -4 degrees F (-20 degrees C) to
+140 degrees F (+60 degrees C).

      2.2.4.2 OPERATIONAL TEMPERATURE. The MTRS, with the exception of the OCS,
shall perform satisfactorily in a temperature range of +20 degrees F (-7 degrees
C) to +122 degrees F (+50 degrees C). The OCS shall perform satisfactorily in a
temperature range of +40 degrees F (+4 degrees C) to +104 degrees F (+40 degrees
C).

      2.2.4.3 OPERATION/SURVIVABILITY IN NUCLEAR, BIOLOGICAL, AND CHEMICAL (NBC)
ENVIRONMENTS. The MTRS shall be operable in NBC environments by operators in
Mission Oriented Protective Posture (MOPP) Level IV. The vehicle and
shipping/storage containers shall cost-effectively survive decontamination with
household bleach and hot soapy water.

      2.2.4.4 OPERATION IN WIND AND RAIN. The vehicle shall perform
satisfactorily when being operated in winds up to 7 knots and rain at rates up
to 0.2 inches per hour.

2.2.5 TRANSPORTABILITY.

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
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      2.2.5.1 TRANSPORTATION VIBRATION. The MTRS shall suffer no damage and
shall perform satisfactorily after being exposed (while in its shipping
containers) to vibration conditions that may be encountered during
transportation over highways and secondary and tertiary roads, as well as during
transportation by aircraft, ships, and trains.

      2.2.5.2 TRANSPORTATION SHOCK. The MTRS shall suffer no damage and shall
perform satisfactorily after being exposed to shock that may be encountered
during transportation.

2.2.6 DESIGN, CONSTRUCTION, AND WORKMANSHIP STANDARDS. Best commercial standards
shall be followed.

2.2.7 IDENTIFICATION AND MARKING. Each shipping container shall be permanently
marked with the following:

Nomenclature (when assigned by the Government)
Name of manufacturer
Serial number
Contract number
Indication of warranty
Expiration date of warranty
Manufacturer's telephone number

2.2.8 SAFETY.

      2.2.8.1 BATTERY LEAKAGE. Any batteries used in the MTRS shall not leak
when the system is operated, stored, or transported.

      2.2.8.2 FIRING CIRCUIT. The design of the firing circuit shall be such
that a mishap requires at least three independent failures, or three independent
human errors, or a combination of three independent failures and human errors in
order to occur.

3. QUALITY ASSURANCE PROVISIONS

Quality assurance is the responsibility of the contractor and shall be in
accordance with the contractor's standard commercial practices. The Government
reserves the right to witness or separately perform any or all quality tests and
inspections.

4. PACKAGING

The MTRS shall be packaged and shipped in its shipping containers (see
2.2.2.1.1) in accordance with best commercial practices.

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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                                    5. NOTES

5.1 ABBREVIATIONS.


                       
degrees C                 Degrees Celsius
degrees F                 Degrees Fahrenheit
EOD                       Explosive Ordnance Disposal
Hz                        Hertz
IED                       Improvised Explosive Device
JAUGS                     Joint Architecture for Unmanned Ground Systems
MCMTOMF                   Mean Corrective Maintenance Time for Operational Mission Failures
MHz                       Megahertz
MOPP                      Mission Oriented Protective Posture
MTBOMF                    Mean Time Between Operational Mission Failures
MTRS                      Man Transportable Robotic System
NBC                       Nuclear, biological, and chemical
OCS                       Operator Control Station
USB                       Universal Serial Bus
UXO                       Unexploded Ordnance
VAC                       Volts Alternating Current


5.2 EOD MISSION. The EOD mission is to eliminate hazards from ordnance
(including IEDs) which jeapordize operations conducted in support of national
military strategy by providing specially trained, combat ready, and highly
mobile forces. As the only military force trained for this mission, EOD
personnel must be prepared to deal rapidly with land, sea, and air threats from
conventional, special (nuclear, biological, and chemical) and unconventional
ordnance. The MTRS will be used in reconnaissance operations conducted by
Department of Defense EOD technicians.

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110



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ATTACHMENT B

FIRM FIXED PRICE SUPPLY CONTRACT WITH PROVISIONS FOR MAINTENANCE OR ACCEPTANCE
TESTING CRITERIA OR OTHER PROVISIONS WHICH REQUIRE UNUSUAL MONITORING AND A COR

            CONTRACT ADMINISTRATION PLAN
            CONTRACT NO. N00174

In order to expedite administration of this contract, the following delineation
of duties is provided. The individual/position designated as having
responsibility should be contacted for any questions, clarifications, or
information regarding the functions assigned.

1. PROCURING CONTRACTING OFFICER (PCO) is responsible for:

      a.    All pre-award information, questions, or data

      b.    Freedom of Information inquiries

      c.    Change/questions/information regarding the scope, terms, or
            conditions of the basic contract document

      d.    Arranging the post award conference

      e.    Monitoring the COR

      f.    Meeting annually with COR to review contract performance (joint
            responsibility of the COR). This may be satisfied telephonically,
            depending on the circumstances.

      Other____________________________________________________________________
      _________________________________________________________________________

2. CONTRACT ADMINISTRATION OFFICE (CAO) is responsible for matters specified in
FAR 42.302 and DFARS 242.302 except in those areas otherwise designated herein.
_______________________________________________________________________________

3. PAYING OFFICE is responsible for payment of approved proper invoices after
acceptance is documented.

4. CONTRACTING OFFICER'S REPRESENTATIVE (COR) is responsible for:

      a.    Controlling all government technical interface with the contractor
            and providing technical advice and clarifications of the
            specifications/statement of work.

      b.    Providing copies of all government/contractor technical
            correspondence to the PCO.

      c.    Promptly furnishing the PCO with documentation/comment on any
            request for change, deviation or waiver (whether generated by the
            government or the contractor).

      d.    Assuring that equipment is delivered on time, and promptly notifying
            the PCO if any contractor delay in delivery is experienced.

      e.    If applicable, coordination of site preparation and installation to
            the extent specified in the contract as the government's
            responsibility.

      f.    Quality assurance, inspection and acceptances of supplies, or
            services (if applicable).

      g.    If applicable, monitoring standard of performance testing or
            effectiveness level acceptance criteria.

      h.    If applicable, monitoring of credits, such as downtime credits for
            maintenance if provided for in the contract, and making appropriate
            adjustments on contractor reimbursement.

NSN 7540-01-152-8057               50336-101          OPTIONAL FORM 336A (4-86)
                                                      Sponsored by GSA
                                                      FAR (48 CFR) 53.110


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      i.    Promptly reviewing the contractor's invoices for goods/services
            received and accepted, to assure that they conform to the contract
            pricing. Improper invoices shall be returned immediately to the
            contractor. Proper correct invoices and/or DD250's, as applicable
            shall be approved and forwarded to the paying office.

      j.    Maintain a COR file of all correspondence with the PCO and
            contractor and copies of all invoices.

      k.    Meeting annually with the PCO to review contract performance, this
            may be satisfied telephonically, depending upon the circumstances.

      l.    Complying with SECNAVINST 4200.27A, "Proper Use of Contractor
            Personnel," NAVSEAINST 4200.17B and SECNAVINST 4205.5 "Contracting
            Officer's Technical Representative" and the Contracting Officer's
            COR Appointment Letter.

      m.    Submission of written report on contractor performance within 60
            days of contract completion, but not less often than annually.

      n.    Anticipating and submitting requests for follow-on contract
            requirements in sufficient time to allow for award prior to the
            expiration of this contract.

      o.    Contract Performance Assessment System (CPARS).

                  (X) This contract WILL be registered in the CPARS database by
                  the Contracts Division with the assistance of the COR. As
                  stated in the COR appointment letter the COR is responsible
                  for updating the CPARS database.

                  ( ) CPARS does NOT apply to this contract.

Other: ____________________________________________________________________
________________________________________________________________________________

NAMES/ADDRESS/TELEPHONE NUMBERS OF COGNIZANT INDIVIDUAL/OFFICE

COR_Byron Brezina____50___________301-744-6850, x255_________________
   NAME              CODE         TELEPHONE

PCO (refer to Contracting Officer who signed contract documents)
  _Renee M. Brown__l 143E_____301-744-6653____________________________
                CODE          TELEPHONE

PAYING OFFICE (refer to page one of the contract document)
CAO (refer to page one of the contract document)

NSN 7540-01-152-8057             50336-101             OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110




                                                                   PAGE OF PAGES
                                                                      1    2

AMENDMENT OF SOLICITATION /MODIFICATION OF CONTRACT

l. CONTRACT ID CODE

         J

2. AMENDMENT/MODIFICATION NO. ____________

3. EFFECTIVE DATE _______________

4. REQUISITION/PURCHASE REQ. NO.

   7575042861074

5. PROJECT NO. (If applicable) __________________

6. ISSUED BY                    CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE
   ATTN: JESSICA MADDOX 113L
   JESSICA.MADDOX@NAVY.MIL
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)  CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE,
   BURLINGTON MA 01803-4903

CODE 066R1                        FACILITY CODE ____________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003-0004

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item l4. The hour
    and date specified for receipt of Offer [ ] is extended, [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:
    (a) By completing Items 8 and 15, and returning _____ copies of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted; or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
    OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR
    OFFER. If by virtue of this amendment you desire to change an offer already
    submitted, such change may be made by telegram or letter, provided each
    telegram or letter makes reference to the solicitation and this amendment,
    and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.

    IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.

    B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

    C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

[X] D. OTHER (Specify type of modification and authority)
       MUTUAL AGREEMENT OF BOTH PARTIES

    E.  IMPORTANT: Contractor [ ] is not [X] is required to sign this document
        and return 1 copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
    including solicitation/contract subject matter where feasible.)
    Modification Control Number: kgak38051151

The purpose of this modification is to extend the period of performance of the
subject contract task order at no cost to either party. See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in lull force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)
     JUDITH BLINN
     CONTRACTS MANAGER

15B. CONTRACTOR/OFFEROR

     /s/ Judith Blinn
     ----------------------------------------
     (Signature of person authorized to sign)

15C. DATE SIGNED

     05 July 2005

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

TEL: _______________                   EMAIL: _____________

16B. UNITED STATES OF AMERICA

BY ____________________________________
    (Signature of Contracting Officer)

16C. DATE SIGNED

EXCEPTION TO SF 30               30-105-04         STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                            0004
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

      CONTINUATION PAGE

      1.    The period of performance of CLIN 0015 on the subject contract task
            order is hereby extended from 21 February 2005 to 30 April 2005 at
            no cost to either party.

      2.    Work under the subject CLIN was not completed until 30 April 2005.

      3.    Contractor's Statement of Release:

            The parties have considered whether an equitable adjustment in the
            contract price, delivery schedule, or other terms and conditions of
            the contract is warranted by virute of the above change to the
            contract task order. The parties agree that no such adjustment is
            warranted. The contractor waives all right, title, and interest, if
            any, to further equitable adjustments arising under this
            modification.

      4.    For additional information, contact Jessica Maddox at 301-744-6614.



                                                                   PAGE OF PAGES
                                                                      1     2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

        J

2. AMENDMENT/MODIFICATION NO. ____________

3. EFFECTIVE DATE ______________

4. REQUISITION/PURCHASE REQ. NO. ______________

5. PROJECT NO. (If applicable) ________________

6. ISSUED BY                   CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE
   ATTN: JESSICA D.MADDOX
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)    CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                          FACILITY CODE _______________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item 14. The hour
    and date specified for receipt of Offer [ ] is extended, [ ] is
    not extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:
    (a) By completing Items 8 and 15, and returning ________ copies of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted; or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
    OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR
    OFFER. If by virtue of this amendment you desire to change an offer already
    submitted, such change may be made by telegram or letter, provided each
    telegram or letter makes reference to the solicitation and this amendment,
    and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.

    IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.

    B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

    C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

[X] D. OTHER (Specify type of modification and authority)
    MUTUAL AGREEMENT OF BOTH PARTIES

    E.  IMPORTANT: Contractor [ ] is not, [X] is required to sign this document
    and return 1 copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
    including solicitation/contract subject matter where feasible.)

    Modification Control Number: kgak380548

The purpose of this modification is to make changes to the ceilings of CLINs
0009 and 0015, See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)
     JUDITH BLINN
     CONTRACTS MANAGER

15B. CONTRACTOR/OFFEROR

    /s/ Judith Blinn
    ----------------------------------------
    (Signature of person authorized to sign)

15C. DATE SIGNED

     15 oct 04

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

TEL: _______________            EMAIL: ______________

16B. UNITED STATES OF AMERICA

BY ____________________________________
    (Signature of Contracting Officer)

16C. DATE SIGNED _______________

EXCEPTION TO SF 30             30-105-04           STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003

                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

      CONTINUATION PAGE

1.    The ceiling of CLIN 0009, Engineering Services, is hereby decreased as
      follows:

            From: $35,000.00
            By: $8,690.00
            To: $26,310.00

2.    The ceiling of CLIN 0015, Engineering Services, is hereby increased as
      follows:

            From: $90,000.00
            By: $8,690.00
            To: $98,690.00

3.    Contractor's Statement of Release:

            The parties have considered whether an equitable adjustment in the
            contract price, delivery schedule, or other terms and conditions of
            the contract is warranted by virtue of the above changes to the
            contract. The parties agree that no such adjustment is warranted.
            The contractor waives all right, title, and interest, if any, to
            further equitable adjustments arising under this modification.

4.    All other terms and conditions remain unchanged.

5.    For additional information, contact Jessica Maddox at 301-744-6614.


                                                                   PAGE OF PAGES
                                                                     1      2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

          J

2. AMENDMENT/MODIFICATION NO.

   02

3. EFFECTIVE DATE

   07-Sep-2004

4. REQUISITION/PURCHASE REQ. NO.____________

   7575041185769

5. PROJECT NO.(If applicable)_______________

6. ISSUED BY                CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: JESSICA D.MADDOX
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (if other than item 6)    CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE
   BURLINGTON MA 01803-4903

CODE 066R1                       FACILITY CODE _____________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003-0003

[X] 10B. DATED (SEE ITEM 13)

    30-Apr-2004

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item 14. The hour
    and date specified for receipt of Offer    [ ] is extended, [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:

    (a) By completing Items 8 and 15, and returning _______ copies of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted; or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
    OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR
    OFFER. If by virtue of this amendment you desire to change an offer already
    submitted, such change may be made by telegram or letter, provided each
    telegram or letter makes reference to the solicitation and this amendment,
    and is received prior to the opening hour and date specified.

12.   ACCOUNTING AND APPROPRIATION DATA (If required)
      SEE SCHEDULE

13.   THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.

      IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

      A.    THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE
            CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN
            ITEM 10A.

      B.    THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
            ADMINISTRATIVE CHANGES (such as changes in paying office,
            appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
            AUTHORITY OF FAR 43.103(B).

      C.    THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
            OF:

[X]   D.    OTHER (Specify type of modification and authority)

            MUTUAL AGREEMENT OF BOTH PARTIES

      E.    IMPORTANT: Contractor [ ] is not, [X] is required to sign this
            document and return 1 copies to the issuing office.

14.   DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
      including solicitation/contract subject matter where feasible.)

      Modification Control Number: kgak38041489

      The purpose of this modification is to deobligate $25,000.00 from the
      subject contract delivery order. See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)___________

15B. CONTRACTOR/OFFEROR

_________________________________________
(Signature of person authorized to sign)

15C. DATE SIGNED____________

16A.  NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

      RENEE M. BROWN/CONTRACTS

TEL: 301/7446653  EMAIL: brownm@ih.navy.mil

16B. UNITED STATES OF AMERICA

BY /s/ Renee M. Brown
   ----------------------------------
   (Signature of Contracting Officer)

16C. DATE SIGNED

     07-Sep-2004

EXCEPTION TO SF 30                30-105-04        STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          000302
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

    CONTINUATION PAGE

1.  CLIN 0015 is hereby removed from the subject contract delivery order.

2.  As a result of the above, the total value of the subject delivery order is
    hereby decreased as follows:

        From: $248,867.00
        By: $25,000.00
        To: $223,867.00

3.  The line of accounting identified by ACRN AA is hereby decreased as follows:

        AA 1741319.8998 260 0464A 0 068892 2D Q03297 0464A485128T
        DECREASE: $25,000.00

4.  All other terms and conditions remain unchanged.

5.  For additional information, contact Jessica Maddox at 301-744-6614.



                                                                   PAGE OF PAGES
                                                                     1      2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

          J

2. AMENDMENT/MODIFICATION NO. __________

3. EFFECTIVE DATE __________

4. REQUISITION/PURCHASE REQ. NO.

   7575041185769

5. PROJECT NO.(If applicable) __________

6. ISSUED BY              CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: JESSICA D. MADDOX
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)  CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE
   BURLINGTON MA 01803-4903

CODE 066R1                       FACILITY CODE ___________

   9A. AMENDMENT OF SOLICITATION NO.

   9B. DATED (SEE ITEM 11)

[X]   10A. MOD. OF CONTRACT/ORDER NO.

      N00174-03-D-0003-0003

[X]   10B. DATED (SEE ITEM 13)

      30-Apr-2004

11.   THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ]   The above numbered solicitation is amended as set forth in Item 14. The
      hour and date specified for receipt of Offer [ ] is extended, [ ] is not
      extended.

      Offer must acknowledge receipt of this amendment prior to the hour and
      date specified in the solicitation or as amended by one of the following
      methods:

      (a) By completing Items 8 and 15, and returning _______ copies of the
      amendment; (b) By acknowledging receipt of this amendment on each copy of
      the offer submitted; or (c) By separate letter or telegram which includes
      a reference to the solicitation and amendment numbers. FAILURE OF YOUR
      ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
      OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF
      YOUR OFFER. If by virtue of this amendment you desire to change an offer
      already submitted, such change may be made by telegram or letter, provided
      each telegram or letter makes reference to the solicitation and this
      amendment, and is received prior to the opening hour and date specified.

12.   ACCOUNTING AND APPROPRIATION DATA (If required)

      SEE SCHEDULE

13.   THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.

      IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

      A.    THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE
            CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN
            ITEM 10A.

      B.    THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
            ADMINISTRATIVE CHANGES (such as changes in paying office,
            appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
            AUTHORITY OF FAR 43.103(B).

      C.    THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
            OF:

[X]   D.    OTHER (Specify type of modification and authority)

            MUTUAL AGREEMENT OF BOTH PARTIES

      E.    IMPORTANT: Contractor [ ] is not, [X] is required to sign this
            document and return 1 copies to the issuing office.

14.   DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
      including solicitation/contract subject matter where feasible.)

      Modification Control Number: kgak38041489

The purpose of this modification is to deobligate $25,000.00 from the subject
contract delivery order. See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)

     R.L. Moses Director of Operations

15B. CONTRACTOR/OFFEROR

     /s/ R. L. Moses
     ------------------------------------------
     (Signature of person authorized to sign)

15C. DATE SIGNED

     3-Sept-04

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

     TEL:__________  EMAIL:_________

16B. UNITED STATES OF AMERICA

BY _________________________________
   (Signature of Contracting Officer)

16C. DATE SIGNED__________

EXCEPTION TO SF 30              30-105-04          STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                            0003
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

    CONTINUATION PAGE

1.  CLIN 0015 is hereby removed from the subject contract delivery order.

2.  As a result of the above, the total value of the subject delivery order is
    hereby decreased as follows:

        From: $248,867.00
        By: $25,000.00
        To: $223,867.00

3.  The line of accounting identified by ACRN AA is hereby decreased as follows:

        AA 1741319.8998 260 0464A 0 068892 2D Q03297 0464A485128T
        DECREASE: $25,000.00

4.  All other terms and conditions remain unchanged.

5.  For additional information, contact Jessica Maddox at 301-744-6614.



                                                                   PAGE OF PAGES
                                                                      1      2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

        J

2. AMENDMENT/MODIFICATION NO.

   01

3. EFFECTIVE DATE

     30-Aug-2004

4. REQUISITION/PURCHASE REQ. NO.

   7575041185769

5. PROJECT NO.(If applicable)__________

6. ISSUED BY              CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: JESSICA D.MADDOX
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (if other than item 6)  CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                       FACILITY CODE ___________

     9A. AMENDMENT OF SOLICITATION NO.

     9B. DATED (SEE ITEM 11)

[X]  10A. MOD. OF CONTRACT/ORDER NO.

     N00174-03-D-0003-0003

[X]  10B. DATED (SEE ITEM 13)

     30-Apr-2004

11.   THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ]   The above numbered solicitation is amended as set forth in Item 14. The
      hour and date specified for receipt of Offer [ ] is extended, [ ] is not
      extended.

      Offer must acknowledge receipt of this amendment prior to the hour and
      date specified in the solicitation or as amended by one of the following
      methods:

      (a) By completing Items 8 and 15, and returning _______ copies of the
      amendment; (b) By acknowledging receipt of this amendment on each copy of
      the offer submitted; or (c) By separate letter or telegram which includes
      a reference to the solicitation and amendment numbers. FAILURE OF YOUR
      ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
      OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF
      YOUR OFFER. If by virtue of this amendment you desire to change an offer
      already submitted, such change may be made by telegram or letter, provided
      each telegram or letter makes reference to the solicitation and this
      amendment, and is received prior to the opening hour and date specified.

12.   ACCOUNTING AND APPROPRIATION DATA (If required)

13.   THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES
      THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

      A.    THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE
            CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN
            ITEM 10A.

      B.    THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
            ADMINISTRATIVE CHANGES (such as changes in paying office,
            appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
            AUTHORITY OF FAR 43.103(B).

      C.    THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
            OF:

[X]   D.    OTHER (Specify type of modification and authority) MUTUAL AGREEMENT
            OF BOTH PARTIES

      E.    IMPORTANT: Contractor [ ] is not, [X] is required to sign this
            document and return 1 copies to the issuing office.

14.   DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
      including solicitation/contract subject matter where feasible.)

      Modification Control Number: kgak38041385

The purpose of this modification is to make a change to the delivery schedule.
See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A.  NAME AND TITLE OF SIGNER (Type or print)

      R. L. Moses Director of Operations

15B.  CONTRACTOR/OFFEROR

      /s/ R. Moses
      ----------------------------------------------
      (Signature of person authorized to sign)

15C.  DATE SIGNED

      24-August-04

16A.  NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

      RENEE M. BROWN/CONTRACTS

      TEL:301/744-6653   EMAIL: brownm@ih.navy.mil

16B.  UNITED STATES OF AMERICA

      BY /s/ Renee M. Brown
         --------------------------------------
         (Signature of Contracting Officer)

16C.  DATE SIGNED

      30-Aug-2004

EXCEPTION TO SF 30                30-105-04        STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          000301
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

      CONTINUATION PAGE

1.    The purpose of this modification is to make a change to the delivery
      schedule of CLIN 0010 at no cost to either party.

2.    The delivery date for CLIN 0010, Production Representative Models (PRMs)
      is hereby changed as follows:

            From: 90 days after receipt of order
            To: 95 days after receipt of order

3.    Contractor's Statement of Release:

      The parties have considered whether an equitable asjustment in the
      contract price, delivery schedule, or other terms and conditions of the
      contract is warranted by virtue of the above change to the contract. The
      parties agree that no such adjustment is warranted. The contractor waives
      all right, title, and interest, if any, to further equitable adjustments
      arising under this modification.

4.    All other terms and conditions remain unchanged.

5.    For additional information, contact Jessica Maddox at 301-744-6614.



                                                                   PAGE OF PAGES
                                                                      1      2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

           J

2. AMENDMENT/MODIFICATION NO.

   P00007

3. EFFECTIVE DATE

     02-Jun-2004

4. REQUISITION/PURCHASE REQ. NO._____________

5. PROJECT NO.(lf applicable)________________

6. ISSUED BY                CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: JESSICA D. MADDOX
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)  CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOTCORP
   DAVEADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                    FACILITY CODE___________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003

[X] 10B. DATED (SEE ITEM 13)

    29-OCT-2002

11.   THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ]   The above numbered solicitation is amended as set forth in Item 14. The
      hour and date specified for receipt of Offer [ ] is extended, [ ] is not
      extended.

      Offer must acknowledge receipt of this amendment prior to the hour and
      date specified in the solicitation or as amended by one of the following
      methods:

      (a) By completing Items 8 and 15, and returning___________copies of the
      amendment; (b) By acknowledging receipt of this amendment on each copy of
      the offer submitted; or (c) By separate letter or telegram which includes
      a reference to the solicitation and amendment numbers. FAILURE OF YOUR
      ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
      OFFERS PRIOR TO THE HOUR AND DATE SPECEFIED MAY RESULT IN REJECTION OF
      YOUR OFFER. If by virtue of this amendment you desire to change an offer
      already submitted, such change may be made by telegram or letter, provided
      each telegram or letter makes reference to the solicitation and this
      amendment, and is received prior to the opening hour and date specified.

12.   ACCOUNTING AND APPROPRIATION DATA (If required)

13.   THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.
      IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

      A.    THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE
            CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN
            ITEM 10A.

      B.    THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
            ADMINISTRATIVE CHANGES (such as changes in paying office,
            appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
            AUTHORITY OF FAR 43.103(B).

      C.    THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
            OF:

[X]   D.    OTHER (Specify type of modification and authority)
            MUTUAL AGREEMENT OF BOTH PARTIES

      E.    IMPORTANT: Contractor [ ] is not, [X] is required to sign this
            document and return 1 copies to the issuing office.

14.   DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
      including solicitation/contract subject matter where feasible.)

      Modification Control Number: kgak38041040

The purpose of this modification is to make changes to the ceilings of CLINs
0009 and 0015. See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)

     /s/ M. David Adler, Sr. Vice President

15B. CONTRACTOR/OFFEROR

     /s/ M. David Adler
     ----------------------------------------
     (Signature of person authorized to sign)

15C. DATE SIGNED

     June 2, 2004

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

     RENEE M. BROWN/CONTRACTS

     TEL: 301/744-6653                EMAIL: brownrm@ih.navy.mil

16B. UNITED STATES OF AMERICA

BY: /s/ RENEE M. BROWN
    ----------------------------------
   (Signature of Contracting Officer)

16C. DATE SIGNED

     02-JUN-2004

EXCEPTION TO SF 30              30-105-04          STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          P00007
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

      CONTINUATION PAGE

1. The ceiling of CLIN 0009, Engineering Services, is hereby decreased as
follows:

      From: $100,000.00 NTE
      By: $65,000.00
      To: $35,000.00 NTE

2. The ceiling of CLIN 0015, Engineering Services, is hereby increased as
follows:

      From: $25,000.00 NTE
      By: $65,000.00
      To: $90,000.00 NTE

3. Contractor's Statement of Release:

      The parties have considered whether an equitable adjustment in the
      contract price, delivery schedule, or other terms and conditions of the
      contract is warranted by virtue of the above changes to the contract. The
      parties agree that no such adjustment is warranted. The contractor waives
      all right, title, and interest, if any, to further equitable adjustments
      arising under this modification.

4. All other terms and conditions remain unchanged.

5. For additional information, contact Jessica Maddox at 301-744-6614.



                                                                   PAGE OF PAGES
                                                                    1         3

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

          J

2. AMENDMENT/MODIFICATION NO.

   P00006

3. EFFECTIVE DATE

    28-Apr-2004

4. REQUISITION/PURCHASE REQ. NO.___________

5. PROJECT NO.(If applicable)______________

6. ISSUED BY              CODE  N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: JESSICA D. MADDOX
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)  CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                    FACILITY CODE ____________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ]   The above numbered solicitation is amended as set forth in Item 14. The
      hour and date specified for receipt of Offer   [ ] is extended, [ ] is not
      extended.

      Offer must acknowledge receipt of this amendment prior to the hour and
      date specified in the solicitation or as amended by one of the following
      methods:

      (a) By completing Items 8 and 15, and returning_______________copies of
      the amendment; (b) By acknowledging receipt of this amendment on each copy
      of the offer submitted; or (c) By separate letter or telegram which
      includes a reference to the solicitation and amendment numbers. FAILURE OF
      YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT
      OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF
      YOUR OFFER. If by virtue of this amendment you desire to change an offer
      already submitted, such change may be made by telegram or letter, provided
      each telegram or letter makes reference to the solicitation and this
      amendment, and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13.   THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES
      THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

      A.    THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE
            CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN
            ITEM 10A.

      B.    THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
            ADMINISTRATIVE CHANGES (such as changes in paying office,
            appropriation date, ete.) SET FORTH IN ITEM 14, PURSUANT TO THE
            AUTHORITY OF FAR 41.103(B).

      C.    THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
            OF:

[X]   D.    OTHER (Specify type of modification and authority)
            MUTUAL AGREEMENT OF BOTH PARTIES

      E.    IMPORTANT: Contractor [ ] is not, [X] is required to sign this
            document and return 1 copies to the issuing office.

14.   DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
      including solicitation/contract subject matter where feasible.)

      Modification Control Number: kgak3804854

The purpose of this modification is to make changes to Section J, Performance
Specification. See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)

15B. CONTRACTOR/OFFEROR

___________________________________________
(Signature of person authorized to sign)

15C. DATE SIGNED_____________

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

     RENEE M. BROWN / CONTRACTS

TEL- 301/744-6653          EMAIL: brownrm@ih.navy.mil

16B. UNITED STATES OF AMERICA

BY /s/ RENEE M. BROWN
   ------------------------------
   (Signature of Contracting Officer)

16C. DATE SIGNED

   28-APR-2004

EXCEPTION TO SF 30              30-105-04          STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243



                                                                N00174-03-D-0003
                                                                          P00006
                                                                     Page 2 of 3

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

    CONTINUATION PAGE

1. Section 2.2.1.4.2 of the Performance Specification is hereby changed as
follows:

      From:

            2.2.1.4.2 CABLED MODE. When being operated in cabled mode (e.g.
            fiber optic, coaxial, multi-conductor), the maximum amount of cable
            that can be deployed between the vehicle and the OCS shall be no
            less than 200 meters. The desired maximum amount of cable is 500
            meters. An indication shall be provided to warn the operator when 20
            meters of cable or less remains to be payed out. A conspicuous
            marking of the cable that can be viewed with a vehicle camera is a
            sufficient indication. THE CABLE SHALL BE STORED ON THE VEHICLE AND
            BE CAPABLE OF PAYING OUT FREELY FROM THE VEHICLE. A self-reeling
            mechanism for cable retrieval located on the vehicle that can be
            controlled from the OCS during a mission is desired. If such a
            self-reeling mechanism is not provided on the vehicle, then a manual
            or powered reeling mechanism shall be provided at the OCS to
            facilitate the retrieval of cable during a mission. A means to
            facilitate the manual retrieval of cable onto the vehicle after a
            mission shall be provided. The capability to lower, lift, and drag
            the vehicle by the cable (without damaging the cable) is desired.

      To:

            2.2.1.4.2 CABLED MODE. When being operated in cabled mode (e.g.
            fiber optic, coaxial, multi-conductor), the maximum amount of cable
            that can be deployed between the vehicle and the OCS shall be no
            less than 200 meters. The desired maximum amount of cable is 500
            meters. An indication shall be provided to warn the operator when 20
            meters of cable or less remains to be payed out. A conspicuous
            marking of the cable that can be viewed with a vehicle camera is a
            sufficient indication. NO LESS THAN 150 METERS OF CABLE SHALL BE
            STORED ON THE VEHICLE AND BE CAPABLE OF PAYING OUT FREELY FROM THE
            VEHICLE. HAVING ALL OF THE CABLE STORED ON THE VEHICLE IS DESIRED. A
            self-reeling mechanism for cable retrieval located on the vehicle
            that can be controlled from the OCS during a mission is desired. If
            such a self-reeling mechanism is not provided on the vehicle, then a
            manual or powered reeling mechanism shall be provided at the OCS to
            facilitate the retrieval of cable during a mission. A means to
            facilitate the manual retrieval of cable onto the vehicle after a
            mission shall be provided. The capability to lower, lift, and drag
            the vehicle by the cable (without damaging the cable) is desired.

2. Section 2.2.1.5.1 of the Performance Specification is hereby changed as
follows:

      From:

            2.2.1.5.1 MAN TRANSPORTABILITY. All components of the system
            necessary to conduct 2 two-hour missions (as outlined in 2.2.1.3
            with one in wireless mode and one in cabled mode) shall weigh no
            more than 145 pounds and shall be capable of being transported a
            distance of 500 meters in semi-rugged terrain as one load by two
            personnel in one trip. The entire weight of the load shall be borne
            by the two personnel. A weight of no more than 75 pounds (vice 145
            pounds) is desired. A load carrying apparatus that combines
            stretcher type handles and shoulder support is recommended, but not
            required, to facilitate transporting the load. Any load carrying
            apparatus shall be considered to be part of the system and the
            weight of such apparatus shall be included in the 145 pound weight
            limit. Any modular vehicle mobility aids shall also be included in
            the 145 pound weight limit. The load carrying apparatus, if
            provided, shall be capable of supporting 160


                                                                N00174-03-D-0003
                                                                          P00006
                                                                     Page 3 of 3

                  pounds (which includes the weight of the apparatus itself) to
                  allow for an additional 15 pounds of weight associated with
                  future system upgrades.

            To:

                  2.2.1.5.1 MAN TRANSPORTABILITY. All components of the system
                  necessary to conduct 2 two-hour missions (as outlined in
                  2.2.1.3 with one in wireless mode and one in cabled mode)
                  shall weigh no more than 175 pounds and shall be capable of
                  being transported a distance of 500 meters in semi-rugged
                  terrain as one load by two personnel in one trip. The entire
                  weight of the load shall be borne by the two personnel. A
                  weight of no more than 75 pounds (vice 175 pounds) is desired.
                  A load carrying apparatus that combines stretcher type handles
                  and shoulder support is recommended, but not required, to
                  facilitate transporting the load. Any load carrying apparatus
                  shall be considered to be part of the system and the weight of
                  such apparatus shall be included in the 175 pound weight
                  limit. Any modular vehicle mobility aids shall also be
                  included in the 175 pound weight limit. The load carrying
                  apparatus, if provided, shall be capable of supporting 190
                  pounds (which includes the weight of the apparatus itself) to
                  allow for an additional 15 pounds of weight associated with
                  future system upgrades.

3.    Section 2.2.1.14 of the Performance Specification is hereby changed as
      follows:

            From:

                  2.2.1.14 FIRING CIRCUIT. The MTRS shall contain a safety
                  critical firing circuit that is capable of initiating
                  electro-explosive devices such as squibs and blasting caps.
                  The output of the firing circuit shall terminate in two
                  suitable terminal posts in an accessible location on the
                  vehicle. THE FIRING CIRCUIT SHALL BE CAPABLE OF PROVIDING NO
                  LESS THAN 2.43 AMPERES OF DIRECT CURRENT. THE OUTPUT VOLTAGE
                  OF THE FIRING CIRCUIT SHALL BE NO LESS THAN 14 VOLTS AND NO
                  GREATER THAN 28 VOLTS. Functioning of the firing circuit shall
                  require a unique sequence of events to be performed at the OCS
                  by the operator. See 2.2.8.2.

            To:

                  2.2.1.14 FIRING CIRCUIT. The MTRS shall contain a safety
                  critical firing circuit that is capable of initiating
                  electro-explosive devices such as squibs and blasting caps.
                  The output of the firing circuit shall terminate in two
                  suitable terminal posts in an accessible location on the
                  vehicle. THE FIRING CIRCUIT SHALL BE CAPABLE OF PROVIDING NO
                  LESS THAN 2.43 AMPERES OF DIRECT CURRENT FOR NO LESS THAN 2.7
                  SECONDS. THE OUTPUT VOLTAGE OF THE FIRING CIRCUIT SHALL BE NO
                  LESS THAN 14.2 VOLTS AND NO GREATER THAN 28 VOLTS. Functioning
                  of the firing circuit shall require a unique sequence of
                  events to be performed at the OCS by the operator. See
                  2.2.8.2.

4.    Contractor's Statement of Release:

      The parties have considered whether an equitable adjustment in the
      contract price, delivery schedule, or other terms and conditions of the
      contract is warranted by virtue of the above changes to the conract. The
      parties agree that no such adjustment is warranted. The contractor waives
      all right, title and interest, if any, to further equitable adjustments
      arising under this modification.

5.    All other terms and conditions remain unchanged.

6.    For additional information, contact Jessica Maddox at 301-744-6614.



                                                                   PAGE OF PAGES
                                                                     1       2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

         J

2. AMENDMENT/MODIFICATION NO.

   P00005

3. EFFECTIVE DATE

   26-Feb-2004

4. REQUISITION/PURCHASE REQ. NO._______________

5. PROJECT NO.(If Applicable)__________________

6. ISSUED BY                   CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE
   ATTN: JESSICA D. MADDOX
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)  CODE  S3319A

   DCMC BOSTON-MANCHESTER
   2 WALL STREET
   MANCHESTER NH 03101-1518

8. NAME AND ADDRESS OF CONTRACTOR (NO., Street, Country, State and Zip Code)

   IROBOT CORP
   DUNS 807380951
   22 MCGRATH HWY SUITE 6
   SOMERVILLE MA 02143

CODE 066R1                           FACILITY CODE______________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ]   The above numbered soliciation is amended as set forth in Item 14. The
      hour and date specified for receipt of Offer   [ ] is extended,  [ ] is
      not extended.

      Offer must acknowledge receipt of this amendment prior to the hour and
      date specified in the solicitation or as amended by one of the following
      methods:

      (a) By completing Items 8 and 15, and returning_________copies of the
      amendment; (b) By acknowledging receipt of this amendment on each copy of
      the offer submitted; or (c) By separate letter or telegram which includes
      a reference to the solicitation and amendment numbers. FAILURE OF YOUR
      ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
      OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF
      YOUR OFFER. If by virtue of this amendment you desire to change an offer
      already submitted, such change may be made by telegram or letter, provided
      each telegram or letter makes reference to the solicitation and this
      amendment, and is received prior to the opening hour and date specified.

12.   ACCOUNTING AND APPROPRIATION DATA (If required)

13.   THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES
      THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

      A.    THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE
            CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN
            ITEM 10A.

[X]   B.    THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
            ADMINISTRATIVE CHANGES (such as changes in paying office,
            appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
            AUTHORITY OF FAR 43.103(B).

      C.    THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
            OF:

      D.    OTHER (Specify type of modification and authority)

      E.    IMPORTANT: Contractor [X] is not, [ ] is required to sign this
            document and return __________ copies to the issuing office.

14.   DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
      including solicitation/contract subject matter where feasible.)

      Modification Control Number: kgak3804570

The purpose of this modification is to incorporate clause IHD 6 into
Section G of the subject contract. See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER(Type or print)_____________

15B. CONTRACTOR/OFFEROR

_____________________________________________
  (Signature of person authorized to sign)

15C. DATE SIGNED_________________________

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

EDNA GIGON/CONTRACTS

TEL: 301/744-6682           EMAIL: gigonea@ih.navy.mil

16B. UNITED STATES OF AMERICA

BY: /s/ EDNA A. GIGON
    --------------------------------------
   (Signature of Contracting Officer)

16C. DATE SIGNED

     26-Feb-2004

EXCEPTION TO SF 30               30-105-04          STANDARD FORM 30(Rev. 10-83)
APPROVED BY OIRM 11-84                              Prescribed by GSA
                                                    FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          P00005
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

   CONTINUATION PAGE

1.    Clause IHD 6 - Contract Points of Contact (NAVSEA/IHD) is hereby
      incorporated into Section G of the subject contract. The text of the
      clause is as follows:

            IHD 6 CONTRACT POINTS OF CONTACT (NAVSEA/IHD)

            The following contacts are provided for this contract:

            Contract Administrator: Jessica D. Maddox
                      Phone Number: 301-744-6614
                     E-mail address: maddoxjd@ih.navy.mil

            Payments/Invoicing: Geneva Wesley
                     Phone Number: 301-744-4840
                     E-mail address: wesleygm@ih.navy.mil

            Technical Representative: Byron Brezina
                     Phone Number: 301-744-6850, x255
                     E-mail address: brezina@eodpoe2.navsea.navy.mil

      Any concerns regarding your contract should be addressed to the above
      mentioned personnel or the Contracting Officer, Renee M. Brown, at
      301-744-6653.

2.    All other terms and conditions remain unchanged.

3.    For additional information, contact Jessica Maddox at 301-744-6614.



                                                                   PAGE OF PAGES
                                                                     1       2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT


1. CONTRACT ID CODE

          J

2. AMENDMENT/MODIFICATION NO.

   02

3. EFFECTIVE DATE

   12-Dec-2003

4. REQUISITION/PURCHASE REQ. NO.

   7575033165628

5. PROJECT NO.(IF APPLICABLE)________________

6. ISSUED BY                   CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: DIANNE HUNTT 1143C
   HUNTTDC@IH.NAVY.MIL
   INDIAN HEAD MD 20640-5035

7.  ADMINISTERED BY (If other than item 6)   CODE  S2206A

    DCMC BOSTON
    495 SUMMER STREET
    BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State, and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                           FACILITY CODE _____________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003-0002

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11.   THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ]   The above numbered solicitation is amended as set forth in Item 14. The
      hour and date specified for receipt of offer   [ ] is extend, [ ] is not
      extended.

      Offer must acknowledge receipt of this amendment prior to the hour and
      date specified in the solicitation or as amended by one of the following
      methods:

      (a) By completing Items 8 and 15, and returning_________copies of the
      amendment; (b) By acknowledging receipt of this amendment on each copy of
      the offer submitted; or (c) By separate letter or telegram which includes
      a reference to the solicitation and amendment numbers. FAILURE OF YOUR
      ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
      OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF
      YOUR OFFER. If by virtue of this amendment you desire to change an offer
      already submitted, such change may be made by telegram or letter, provided
      each telegram or letter makes reference to the solicitation and this
      amendment, and is received prior to the opening hour and date specified.

12.   ACCOUNTING AND APPROPRIATION DATA (If required)

13.   THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES
      THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

      A.    THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE
            CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN
            ITEM 10A.

[X]   B.    THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
            ADMINISTRATIVE CHANGES (such as changes in paying office,
            appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
            AUTHORITY OF FAR 43.103(B).

      C.    THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
            OF:

      D.    OTHER (Specify type of modification and authority)

      E.    IMPORTANT: Contractor [X] is not, [ ] is required to sign this
            document and return__________ copies to the issuing office.

14.   DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
      including soliciation/contract subject matter where feasible.)

      Modification Control Number: pcaw3604267

The purpose of this modification is to change the Accounting and Appropriation
Data under the subject contract delivery order in accordance with page 2.

Except as provided herein, all terms and conditions of the document referenced
in item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER(Type or print)

15B. CONTRACTOR/OFFEROR

_____________________________________________
  (Signature of person authorized to sign)

15C. DATE SIGNED

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)___________

        RENEE M. BROWN/CONTRACTS

        TEL: 301/744-6653           EMAIL: brownrm@ih.navy.mil

16B. UNITED STATES OF AMERICA

BY: /s/ Renee M. Brown
    ----------------------------------------
    (Signature of Contracting Officer)

16C. DATE SIGNED

     12-Dec-2003

EXCEPTION TO SF 30                30-105-04         STANDARD FORM 30(Rev. 10-83)
APPROVED BY OIRM 11-84                              Prescribed by GSA
                                                    FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          000202
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:

1.    Delivery Order 0002, page 2, Accounting and Appropriation Data is changed
      to read as follows.

      AA 1741319.8994 260 0464A 0 068892 2D Q00594 0464A445053T $35,000.00
      Req # 75750 3316 5628

2.    Questions concerning this modification are to be directed to Dianne Huntt
      at 301-744-6195.

                                                                  PAGE  OF PAGES

                                                                   1         2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

          J

2. AMENDMENT/MODIFICATION NO.

   01

3. EFFECTIVE DATE 26-NOV-2003

4. REQUISITION/PURCHASE REQ. NO. 7575033165628

5. PROJECT NO. (If applicable)

6. ISSUED BY                               CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: DIANNE HUNTT 1143C
   HUNTTDC@IH.NAVY.MIL
   INDIAN HEAD MD 20640-5035


7. ADMINISTERED BY (If other than item 6)  CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, Sate and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS # 807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                                     FACILITY CODE ___________________

   9A. AMENDMENT OF SOLICITATION NO.

   9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003-0002

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item 14. The
    hour and date specified for receipt of Offer [ ] is extended, [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:
    (a) By completing Items 8 and 15, and returning ____ copies of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted; or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
    OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR
    OFFER. If by virtue of this amendment you desire to change an offer already
    submitted, such change may be made by telegram or letter, provided each
    telegram or letter makes reference to the solicitation and this amendment,
    and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.
    IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.

[X] B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

    C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

    D. OTHER (Specify type of modification and authority)

    E. IMPORTANT: Contractor [X] is not, [ ] is required to sign this document
       and return _______ copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
    including solicitation/contract subject matter where feasible.)
    Modification Control Number: pcaw 3604198

The purpose of this modification is to make a clercial correction to Delivery
Order 0002, page 1, Total Amount, in accordance with page 2.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

   15A. NAME AND TITLE OF SIGNER (Type or print)

   15B CONTRACTOR/OFFEROR
       __________________________________________________________
      (Signature of person authorized to sign)

   15C. DATE SIGNED

   16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

        RENEE M. BROWN / CONTRACTS

   TEL: 301/744-6653                                    EMAIL:brownrm@h.navy.mil

   16B. UNITED STATES OF AMERICA

   BY: /s/ RENEE M. BROWN
       ----------------------------------
       (Signature of Contracting Officer)

   16C. DATE SIGNED

   26-NOV-2003

EXCEPTION TO SF 30                  30-105-04      STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          000201
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:
     N00174-03-D-0003 00002 01

1.    Delivery Order 0002, DD Form 1155, page 1, block 25, Total, is changed as
      follows:

                    DELETE: $100,000.00
                    INSERT: $ 35,000.00

2.    Questions concerning this modification are to be directed to Dianne Huntt
      at 301-744-6195.



                                                                   PAGE OF PAGES
                                                                     1       2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

         J

2. AMENDMENT/MODIFICATION NO.

3. EFFECTIVE DATE

4. REQUISITION/PURCHASE REQ. NO.

5. PROJECT NO.(lf applicable)

6. ISSUED BY CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: DIANNE HUNTT 1143C
   HUNTTDC@IH.NAVY.MIL
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6) CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE
   BURLINGTON MA 01803-4903

   CODE 066R1                                          FACILITY CODE ___________

   9A. AMENDMENT OF SOLICITATION NO.

   9B. DATED (SEE 1TEM 11)

[X] 10A MOD OF CONTRACT/ORDER NO.
    N00174-03-D-0003

[X] 10B. DATED (SEE ITEM 13)
    29-Oct-2002



11. THIS : TEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item 14. The
    hour and date specified for receipt of offer [ ] is extended, [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:
    (a) By completing Items 8 and 15. and returning ______ cop as of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted; or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE REJECTION OF YOUR OFFER. If by virtue of this amendment
    you desire to change an offer already submitted, such change may be made by
    telegramor letter, provided each telegramor letter makes reference to the
    solicitation and this amendment, and is received prior to the opening hour
    and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.
    IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO:(Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN  ITEM  10A.

    B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

[X] C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
       mutual agreement

    D. OTHER (Specify type of modification and authority)

    E. IMPORTANT: Contractor [ ] is not, [X] is required to sign this document
       and return 1 copies to the issuing office.

14.DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
   including solicitation/contract subject matter where feasible.)

   Modification Control Number: pcaw3604187

The purpose of this modification is to change the ordering period for Phase I in
Section B and F of the subject contract in accordance with page 2.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as hereto fore changed, remains unchanged and in lull force
and effect.

   15A. NAME AND TITLE OF SIGNER (Type or print)

        M. David Adler, Sr. Vice President

   15B. CONTRACT OR/OFFEROR

        /s/ M. David Adler
        ---------------------------------------
        (Signature of person authorized to sign)

   15C. DATE SIGNED

        NOV 25, 2003

   16A. NAME AND TITLE OF CONTRACTING OFFICER(Type or print)

   Tel:____________________             EMAIL:_______________________

   16B. UNITED STATES OF

   BY__________________________________
   (Signature or Contracting Officer)

   16C. DATE SIGNED

EXCEPTION TO SF 30              30-105-04         STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR(48 CFR) 53.243



                                                                N00174-03-D-0003

                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:
      N00174-03-D-0003 P4 IROBOT

1.    Section B - Supplies or Services and Prices, Page 2, Phase I - PSVM, and
      Section F - Deliveries or Performance, page 24, Phase I ordering period is
      changed as follows:

      Delete: from date of award until six (6) months after date of contract
              (ADC)

      Insert: from date of award to fourteen (14) months after date of contract
              (ADC)

2.    The parties have considered whether an equitable adjustment in the
      contract price or other terms and conditions of the contract is warranted
      by virtue of the above change to the contract. The parties agree that no
      such adjustment is warranted. The contractor waives all right, title and
      interest, if any, to further equitable adjustments arising under this
      modification.

3.    Questions concerning this modification are to be directed to Dianne Huntt
      at 301-744-6195.


                                                                   PAGE OF PAGES
                                                                      1      2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

        J

2. AMENDMENT/MODIFICATION NO.

   P00004

3. EFFECTIVE DATE

   26-Nov-2003

4. REQUISITION/PURCHASE REQ. NO. _________________

5. PROJECT NO.(If applicable) _________________

6. ISSUED BY                     CODE  N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: DIANNE HUNTT 1143C
   HUNTTDC@IH.NAVY.MIL
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)            CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                           FACILITY CODE ___________________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003

    10B. DATED (SEE ITEM 13)

[X] 29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item l4. The hour
    and date Specified for receipt of offer [ ] is extended, [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:
    (a) By completing Items 8 and 15, and returning ________ copies of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted; or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
    OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR
    OFFER. If by virtue of this amendment you desire to change an offer already
    submitted, such change may be made by telegram or letter, provided each
    telegram or letter makes reference to the solicitation and this amendment,
    and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTORS/ORDERS.
    IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.

    B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

[X] C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
       mutual agreement

    D. OTHER (Specify type of modification and authority)

    E. IMPORTANT: Contractor [ ] is not, [X] is required to sign this document
       and return  1  copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
    including solicitation/contract subject matter where feasible.)
    Modification Control Number:  pcaw 3604187

The purpose of this modification is to change the ordering period for Phase 1 in
Section B and F of the subject contract in accordance with page 2.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print) ______________________

15B. CONTRACTOR/OFFEROR

__________________________________________
 (Signature of person authorized to sign)

15C. DATE SIGNED

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
     RENEE M. BROWN / CONTRACTS
     TEL: 301/744-6653             EMAIL: brownm@ih.navy.mil

16B. UNITED STATES OF AMERICA

BY /s/ Renee M. Brown
   ------------------------------------
   (Signature of Contracting Officer)

16C. DATE SIGNED

     26-Nov-2003

EXCEPTION TO SF 30              30-105-04          STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          P00004
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

THE FOLLOWING ITEMS ARE APPLICABLE TO THIS MODIFICATION:
    N00174-03-D-0003 P4 IROBOT

1.    Section B - Supplies or Services and Prices, page 2, Phase I - PSVM, and
      Section F - Deliveries or Performance, page 24, Phase I ordering period is
      changed as follows:

            Delete: from date of award until six (6) months after date of
            contract (ADC)

            Insert: from date of award to fourteen (14) months after date of
            contract (ADC)

2.    The parties have considered whether an equitable adjustment in the
      contract price or other terms and conditions of the contract is warranted
      by virtue of the above change to the contract. The parties agree that no
      such adjustment is warranted. The contractor waives all right, title and
      interest, if any, to further equitable adjustments arising udner this
      modification.

3.    Questions concerning this modification are to be directed to Dianne Huntt
      at 301-744-6195.



                                                                   PAGE OF PAGES
                                                                       1     2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

2. AMENDMENT/MODIFICATION NO.

   P00003

3. EFFECTIVE DATE

   02-Jul-2003

4. REQUISITION/PURCHASE REQ. NO. _______________

5. PROJECT NO.(If applicable) ______________

6. ISSUED BY                       CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: DANNE HUNTT 1143C
   HUNTTDC@IH.NAVY.MIL
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)     CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                         FACILITY CODE _______________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item l4. The
    hour and date specified for receipt of offer [ ] is extended, [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and
    date specified in the solicitation or as amended by one of the following
    methods: (a) By completing Items 8 and 15, and returning ________ copies
    of the amendment; (b) By acknowledging receipt of this amendment on each
    copy of the offer submitted; or (c) By separate letter or telegram which
    includes a reference to the solicitation and amendment numbers. FAILURE OF
    YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT
    OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF
    YOUR OFFER. If by virtue of this amendment you desire to change an offer
    already submitted, such change may be made by telegram or letter, provided
    each telegram or letter makes reference to the solicitation and this
    amendment, and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTORS/ORDERS. IT MODIFIES
    THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.

    B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

[X] C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
        FAR 52.243-1 CHANGES FIXED PRICE

    D. OTHER (Specify type of modification and authority)

    E. IMPORTANT: Contractor [ ] is not, [X] is required to sign this document
       and return 2 copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
    including solicitation/contract subject matter where feasible.)

THE PURPOSE OF THIS MODIFICATION IS TO MAKE A CHANGE TO THE PERFORMANCE
SPECIFICATION UNDER THE SUBJECT CONTRACT IN ACCORDANCE WITH PAGE 2.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)

15B. CONTRACTOR/OFFEROR

     ________________________________________
     (Signature of Person authorized to Sign)

15C. DATE SIGNED _____________________

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
     DIANNE HUNTT / CONTRACTS

16B. UNITED STATES OF AMERICA

BY /s/ Dianne C. Huntt
   ----------------------------------------
   (Signature of Contracting officer)

16C. DATE SIGNED
     02-Jul-2003

EXCEPTION TO SF 30          30-105-04           STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                          Prescribed by GSA
                                                FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          P00003
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

1.    Section J - List of Documents, Exhibits and Other Attachments, page 40,
      Attachment - A Performance Specification for Man Transportable Robotic
      System, Section 2.2.1.4.1- Wireless Mode, the following statement is
      hereby incorporated into this contract.

      2.4. GHz "Non-Licensed" devices that comply with the regulations contained
      in Annex K of the National Telecommunications and Information
      Administration (NTIA) Manual of Regulations & Procedures for Federal Radio
      Frequency Management (January 2000 Edition). Annex K is titled "Technical
      Standards for Federal "Non-Licensed" Devices."

2.    The parties have considered whether an equitable adjustment in the
      contract price or other terms and conditions of the contract are warranted
      by virtue of the above change to the contract. The parties agree no such
      adjustment is warranted. The contractor waives all right, title and
      interest, if any, to further equitable adjustments arising under this
      modification.



                                                                   PAGE OF PAGES
                                                                     1       2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

2. AMENDMENT/MODIFICATION NO.

   P00003

3. EFFECTIVE DATE

   Jul 02 2003

4. REQUISITION/PURCHASE REQ. NO.

5. PROJECT NO.(If applicable)

6. ISSUED BY                  CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: DIANNE HUNTT 1143C
   HUNTTDC@IH.NAVY.MIL
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)       CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                        FACILITY CODE___________

   9A. AMENDMENT OF SOLICITATION NO.

   9B. DATED (SEE ITEM 11)


   [X] 10A. MOD. OF CONTRACT/ORDER NO.

       N00174-03-D-0003

   [X] 10B. DATED (SEE ITEM 13)

       29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item l4.The hour
    and date specified for receipt of Offer [ ] is extended. [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:
    (a) By completing Items 8 and 15, and returning ________ copies of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted, or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
    OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR
    OFFER. If by virtue of this amendment you desire to change an offer already
    submitted, such change may be made by telegram or letter, provided each
    telegram or letter makes reference to the solicitation and this amendment,
    and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTORS/ORDERS.
    IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.

    B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

[X] C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
       FAR 52.243-1 CHANGES FIXED PRICE

    D. OTHER (Specify type of modification and authority)

    E. IMPORTANT: Contractor [ ] is not, [X] is required to sign this document
       and return 2 copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
including solicitation/contract subject matter where feasible.)

THE PURPOSE OF THIS MODIFICATION IS TO MAKE A CHANGE TO THE PERFORMANCE
SPECIFICATION UNDER THE SUBJECT CONTRACT IN ACCORDANCE WITH PAGE 2.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)

     M. David Adler  Sr. Vice President

15B. CONTRACTOR/OFFEROR

     /s/ M. David Adler
(Signature of person authorized to sign)

15C. DATE SIGNED

July 1 2003

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

16B. UNITED STATES OF AMERICA

BY /s/ DIANNE C. HUNTT
(Signature of Contracting Officer)

16C. DATE SIGNED

02 JUL 2003

EXCEPTION TO SF 30             30-105-04           STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          P00003
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

1.    Section J - List of Documents, Exhibits and Other Attachments, page 40,
      Attachment - A Performance Specification for Man Transportable Robotic
      System. Section 2.2.1.4.1 - Wireless Mode, the following statement is
      hereby incorporated into this contract.

      2.4, GHz "Non-Licensed" devices that comply with the regulations contained
      in Annex K of the National Telecommunications and Information
      Administration (NTIA) Manual of Regulations & Procedures for Federal
      Radio Frequency Management (January 2000 Edition). Annex K is titled
      "Technical Standards for Federal "Non-Licensed" Devices."

2.    The parties have considered whether an equitable adjustment in the
      contract price or other terms and conditions of the contract are warranted
      by virtue of the above change to the contract. The parties agree no such
      adjustment is warranted. The contractor waives all right, title and
      interest, if any, to further equitable adjustments arising under this
      modification.

                                                                   PAGE OF PAGES
                                                                    1       2
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1 . CONTRACT ID CODE

           J

2. AMENDMENT/MODIFICATION NO.

   01

3. EFFECTIVE DATE

   07-Feb-2003

4. REQUISITION/PURCHASE REQ. NO.

   PSVM PHASE - IROBOT

5. PROJECT NO.(If applicable)

6. ISSUED BY                      CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: JESSICA MADDOX 11431 MADDOXJD@I
   H.NAVY.MIL
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)      CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA  01803-4903

CODE 066R1                       FACILITY CODE

   9A. AMENDMENT OF SOLICITATION NO.

   9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003-0001

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item 14. The hour
    and date specified for receipt of Offer [ ] is extended, [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:

    (a) By completing Items 8 and 15, and returning _____ copies of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted; or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE REJECTION OF YOUR OFFER. If by virtue of this amendment
    you desire to change an offer already submitted, such change may be made by
    telegram or letter, provided each telegram or letter makes reference to the
    solicitation and this amendment, and is received prior to the opening hour
    and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.
    IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.

    B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

    C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

[X] D.OTHER (Specify type of modification and authority)

    MUTUAL AGREEMENT OF BOTH PARTIES

    E. IMPORTANT: Contractor [ ] is not, [X] is required to sign this document
       and return 1 copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
    including solicitation/contract subject matter where feasible.)

The purpose of this modification is to make changes to the company's address,
CAGE code, DUNS number, and assigned DCMA office of the subject contract. See
page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)

15B. CONTRACTOR/OFFEROR
________________________________________
(Signature of person authorized to sign)

15C. DATE SIGNED

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

     RENEE M. BROWN / CONTRACTS

16B. UNITED STATES OF AMERICA

     BY /s/ [ILLEGIBLE]
        ---------------
     (Signature of Contracting Officer)

16C. DATE SIGNED

     07-Feb-2003

EXCEPTION TO SF 30              30-105-04          STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          000101
                                                                     Page 2 of 2

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

1.    The address provided in block 9 of the DD Form 1155 is hereby revised as
      follows:

            From: 37 Wilton Road            To: 63 South Avenue
                  Milford, NH 03055             Burlington, MA 01803-4903

2.    The CAGE code provided in block 9 of the DD Form 1155 is hereby revised as
      follows:

            From: 1BNT3
            To: 066R1

3.    The DUNS number provided in block 9 of the DD Form 1155 is hereby revised
      as follows:

            From: 604499194
            To: 807380951

4.    The DCMA office shown in block 7 of the DD Form 1155 is hereby revised as
      follows:

            From: DCMC Boston-Manchester          To: DCMA Boston
                  2 Wall Street                       495 Summer Street
                  Manchester, NH 03101-1518           Boston, MA 02210-2138

5.    Contractor's Statement of Release:

            The parties have considered whether an equitable adjustment in the
            contract price, delivery schedule, or other terms and conditions of
            the contract is warranted by virtue of the above changes to the
            contract. The parties agree that no such adjustment is warranted.
            The contractor waives all right, title and interest, if any, to
            further equitable adjustments arising under this modification.

6.    All other terms and conditions remain unchanged.

7.    For further information, contact Jessica Maddox at 301-744-6614.


                                                                   PAGE OF PAGES
                                                                     1       4

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

2. AMENDMENT/MODIFICATION NO.

   P00002

3. EFFECTIVE DATE

   07-Feb-2003

4. REQUISITION/PURCHASE REQ. NO.

5. PROJECT NO.(If applicable)

6. ISSUED BY                   CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: JESSICA MADDOX 11431 MADDOXJD@I
   H.NAVY.MIL
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)       CODE S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2138

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

CODE 066R1                    FACILITY CODE

   9A. AMENDMENT OF SOLICITATION NO.

   9B. DATED (SEE ITEM 11 )

[X] 10A. MOD. OF CONTRACT/ORDER NO.

    N00174-03-D-0003

[X] 10B. DATED (SEE ITEM 13)

    29-Oct-2002

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ] The above numbered solicitation is amended as set forth in Item 14. The hour
    and date specified for receipt of Offer [ ] is extended,  [ ] is not
    extended.

    Offer must acknowledge receipt of this amendment prior to the hour and date
    specified in the solicitation or as amended by one of the following methods:
    (a) By completing Items 8 and 15, and returning_____ copies of the
    amendment; (b) By acknowledging receipt of this amendment on each copy of
    the offer submitted; or (c) By separate letter or telegram which includes a
    reference to the solicitation and amendment numbers. FAILURE OF YOUR
    ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF
    OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR
    OFFER. If by virtue of this amendment you desire to change an offer already
    submitted, such change may be made by telegram or letter, provided each
    telegram or letter makes reference to the solicitation and this amendment,
    and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (If required)

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.
    IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

    A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES
       SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.

    B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
       ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
       date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
       43.103(B).

    C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

[X] D. OTHER (Specify type of modification and authority)

    MUTUAL AGREEMENT OF BOTH PARTIES

    E. IMPORTANT: Contractor [ ] is not, [X] is required to sign this document
       and return 1 copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
    including solicitation/contract subject matter where feasible.)

The purpose of this modification is to make changes to the company's address,
CAGE code, DUNS number, assigned DCMA office, Section B, and the Performance
Specification of the subject contract. See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)

15B. CONTRACTOR/OFFEROR
________________________________________
(Signature of person authorized to sign)

15C. DATE SIGNED

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

RENEE M. BROWN / CONTRACTS

16B. UNITED STATES OF AMERICA

BY /s/ Renee M. Brown
- ----------------------------------
(Signature of Contracting Officer)

16C. DATE SIGNED

07-Feb-2003

EXCEPTION TO SF 30               30-105-04         STANDARD FORM 30 (Rev. 10-83)
APPROVED BY OIRM 11-84                             Prescribed by GSA
                                                   FAR (48 CFR) 53.243


                                                                N00174-03-D-0003
                                                                          P00002
                                                                     Page 2 of 4

SECTION SF 30 BLOCK 14 CONTINUATION PAGE

1.    The address provided in Section A, block 15A of the SF 33 is hereby
      revised as follows:

            From: 37 Wilton Road                   To: 63 South Avenue
                  Milford, NH 03055                    Burlington, MA 01803-4903

2.    The CAGE code provided in Section A, block 15A of the SF 33 is hereby
      revised as follows:

            From: 1BNT3
            To: 066R1

3.    The DUNS number provided in Section A, block 15A of the SF33 is hereby
      revised as follows:

            From: 604499194
            To: 807380951

4.    The DCMA office shown in Section A, block 24 of the SF33 is hereby revised
      as follows:

            From: DCMC Boston-Manchester           To: DCMA Boston
                  2 Wall Street                        495 Summer Street
                  Manchester, NH 03101-1518            Boston, MA 02210-2138

5.    The description provided for Phase II - PRM on page four (4) of the
      subject contract is hereby changed as follows:

            From:

                  PHASE II - PRM

                  During Phase I, the Government is going to test the PSVMs to
                  the Performance Specification for conformance. There may be
                  some minor modifications that will be requested by the
                  Government. The purpose of Phase II is to incorporate those
                  changes. The contractor(s) will receive a Request for
                  Quotation identifying the minor modifications that need to be
                  made. Once the price has been determined reasonable, the
                  Government will issue a fixed price order(s). The Government
                  will utilize the Not to Exceed CLIN 0012 for the
                  modifications. If the Government does not want change from
                  Phase I, the Phase II will not be funded. It is also possible
                  that Phase II will only be funded for one (1) contractor.
                  Phase II includes CLINs 0011 through 0016 and the ordering
                  period for Phase II shall be from eighteen (18) months after
                  date of contract (ADC) through twenty-four (24) months ADC.

            To:

                  PHASE II - PRM

                  During Phase I, the Government is going to test the PSVMs to
                  the Performance Specification for conformance. There may be
                  some minor modifications that will be requested by the
                  Government. The purpose of Phase II is to incorporate those
                  changes. The contractor(s) will receive a Request for
                  Quotation identifying the minor modifications that need to be
                  made. Once the price has been determined reasonable, the
                  Government will issue a fixed price order(s). The Government
                  will utilize the Not to Exceed CLIN 0011 for the
                  modifications. If the Government does not want change from
                  Phase I, the Phase II will not be funded. It is also possible
                  that Phase II will only be funded for one (1) contractor.
                  Phase II includes CLINS 0010 THROUGH 0015 and the ordering



                                                                N00174-03-D-0003
                                                                          P00002
                                                                     Page 3 of 4

                  period for Phase II shall be from eighteen (18) months after
                  date of contract (ADC) through twenty-four (24) months ADC.

6.    The description provided for Phase III - Production on page six (6) of the
      subject contract is hereby changed as follows:

            From:

                  PHASE III - PRODUCTION

                  Phase III is for production. Only one contractor will be
                  funded for the Production phase. At contract award, the
                  contractor shall provide an estimated unit price. Prior to
                  entering into Phase III, the Government will issue a Request
                  for Proposal (RFP) to the contractor(s). The RFP will request
                  the contractor to provide their final production unit costs
                  based on the final system configuration agreed upon in Phase
                  II or Phase I should the Government decide not to fund Phase
                  II. The offeror who offers the lowest unit price will be
                  funded for the production phase. Phase III includes CLINs 0017
                  through 0025 and the ordering period for Phase III shall be
                  from twenty-eight (28) months after date of contract (ADC)
                  through ten (10) years ADC.

            To:

                  PHASE III - PRODUCTION

                  Phase III is for production. Only one contractor will be
                  funded for the Production phase. At contract award, the
                  contractor shall provide an estimated unit price. Prior to
                  entering into Phase III, the Government will issue a Request
                  for Proposal (RFP) to the contractor(s). The RFP will request
                  the contractor to provide their final production unit costs
                  based on the final system configuration agreed upon in Phase
                  II or Phase I should the Government decide not to fund Phase
                  II. The offeror who offers the lowest unit price will be
                  funded for the production phase. Phase III includes CLINs 0016
                  THROUGH 0025 and the ordering period for Phase III shall be
                  from twenty-eight (28) months after date of contract (ADC)
                  through ten (10) years ADC.

7.    The description for Phase III - Production found at the end of page eight
      (8) of the subject contract is hereby deleted.

8.    CLIN 0016 found at the top of page nine (9) of the subject contract is
      hereby deleted. CLIN 0016 found on page six (6) of the subject contract
      remains unchanged.

9.    Page 45 of the subject contract, Performance Specification section
      2.2.1.10 is hereby changed as follows:

            From:

                  "However, all camera views provided shall be able to be viewed
                  simultaneously at the OCS and at least one vehicle camera
                  shall have the following characteristics:..."

            To:

                  "The capability for all camera views provided to be viewed
                  simultaneously at the OCS is desired. At least one vehicle
                  camera shall have the following characteristics:..."

10. Page 46 of the subject contract, Performance Specification section
    2.2.1.13 is hereby changed as follows:

            From:

                  "JOINT ARCHITECTURE FOR UNMANNED GROUND SYSTEMS (JAUGS). The
                  MTRS shall comply with the Joint Architecture for Unmanned
                  Ground Systems Reference Architecture Specification



                                                                N00174-03-D-0003
                                                                          P00002
                                                                     Page 4 of 4

                  version 2.0."

            To:

                  "JOINT ARCHITECTURE FOR UNMANNED SYSTEMS (JAUS). The messaging
                  (communication) between the vehicle and the OCS shall comply
                  with the Joint Architecture for Unmanned Systems Reference
                  Architecture Specification version 3.0."

11.   Contractor's Statement of Release:

            The parties have considered whether an equitable adjustment in the
            contract price, delivery schedule, or other terms and conditions of
            the contract is warranted by virtue of the above changes to the
            contract. The parties agree that no such adjustment is warranted.
            The contractor waives all right, title and interest, if any, to
            further equitable adjustments arising under this modification.

12.   Modification P00001 was never issued.

13.   All other terms and conditions remain unchanged.

14.   For further information, contact Jessica Maddox at 301-744-6614.

                                                                   PAGE OF PAGES
                                                                     1       2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1. CONTRACT ID CODE

        J

2. AMENDMENT/MODIFICATION NO.

       01

3. EFFECTIVE  DATE

       07 - FEB - 2003

4. REQUISITION/PURCHASE REQ. NO.

   PSVM PHASE - IROBOT

5. PROJECT NO, (If applicable)___________________________

6. ISSUED BY                    CODE N00174

   NAVSEA INDIAN HEAD
   101 STRAUSS AVE.
   ATTN: JESSICA MADDOX 1143L MADDOXJD@1
   H.NAVY.MIL
   INDIAN HEAD MD 20640-5035

7. ADMINISTERED BY (If other than item 6)      CODE  S2206A

   DCMC BOSTON
   495 SUMMER STREET
   BOSTON MA 02210-2136

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State and Zip Code)

   IROBOT CORP
   DAVE ADLER
   DUNS #807380951
   63 SOUTH AVE.
   BURLINGTON MA 01803-4903

   CODE  066R1                           FACILITY CODE ____________

    9A. AMENDMENT OF SOLICITATION NO.

    9B. DATED (SEE ITEM 11)

[X] 10A. MOD. OF CONTRACT/ORDER NO.
    N00174-03-D-0003-0001

[X] 10B. DATED (SEE ITEM 13)
    29-Oct-2002


11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[ ]   The above numbered solicitation is amended as set forth in Item 14. The
      hour and date specified in receipt of offer.   [ ] is extended. [ ] is not
      extended.

      Offer must acknowledge receipt of this amendment prior to the hour and
      date specified in the solicitation or as amended by one of the following
      methods; (a) By completing Items 8 and 15, and returning ________ copies
      of the Amendment; (b) By acknowledging receipt of this amendment on each
      copy of the offer submitted; or (c) By separate letter or telegarm which
      includes a reference to the solicitation and amendment numbers. FAILURE OF
      YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT
      OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF
      YOUR OFFER. If by virtue of this amendment you desire to change an offer
      already submitted, such change may be made by telegram or letter,
      provided each telegram or letter makes reference to the solicitation and
      this amendment, and is received prior to the opening hour and date
      specified.

12.   ACCOUNTING AND APPROPRIATION DATA (If required)

13.   THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES
      THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

      A.    THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE
            CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN
            ITEM 10A.

      B.    THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
            ADMINISTRATIVE CHANGES (such as changes in paying office,
            appropriation date, etc) SET FORTH IN ITEM l4, PURSUANT TO THE
            AUTHORITY OF FAR 43.103(B).

      C.    THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
            OF:

[X]   D.    OTHER (Specify type of modification and authority)
            MUTUAL AGREEMENT OF BOTH PARTIES

      E.    IMPORTANT: Contractor [ ] is not , [x] is required to sign this
            document and return 1 Copies to the issuing office.

14.   DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
      including solicitation/contract subject matter where feasible.

      The purpose of this modifications is to make changes to the company's
      address, CAGE code, DUNS number, and assigned DCMA office of the subject
      contract See page 2 for details.

Except as provided herein, all terms and conditions of the document referenced
in item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)
     M. David Adler, Sr. Vice President

15B. CONTRACTOR/OFFEROR

     /s/ M. David Adler
     -----------------------------------
     (Signature of person  authorized to sign)

15C. DATE SIGNED

     Jan 30, 2003

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

     RENEE M. BROWN

16B. UNITED STATES OF AMERICA

By /s/ RENEE M. BROWN
   --------------------------------
   (Signature of Contracting Officer)

16C. DATE SIGNED

     07 FEB 2003

EXCEPTION TO SF 30              30-105-04         STANDARD FORM 30 (Rev, 10-83)
APPROVED BY OIRM 11-84                            Prescribed by GSA
                                                  FAR (48 CFR) 53.243


                                                                       PAGE 1 OF
                                                                               3

                         ORDER FOR SUPPLIES OR SERVICES

1. CONTRACT/PURCH. ORDER/
   AGREEMENT NO.
N00174-03-D-0003

2. DELIVERY ORDER/ CALL NO.

0001

3. DATE OF ORDER/CALL

   2002 Oct 29

4. REQ./PURCH. REQUEST NO.

   PSVM PHASE - IROBOT

5. PRIORITY

6. ISSUED BY             CODE N00174

NAVSEA INDIAN HEAD
101 STRAUSS AVE.
ATTN: JESSICA MADDOX 11431 MADDOXJD@IH.NAVY.MIL

INDIAN HEAD, MD 20640-5035

7. ADMINISTERED BY (if other than 6)           CODE S3319A

DCMC BOSTON-MANCHESTER

2 WALL STREET

MANCHESTER, NH 03101-1518

8. DELIVERY FOB
   [X] DEST
   [ ] OTHER

(See Schedule if other)

9. CONTRACTOR          CODE  1BNT3          FACILITY ___________
IROBOT CORP
ATTN GRINNELL MORE
DUNS #604499194
37 WILTON ROAD

MILFORD, NH 03055

10. DELIVER TO FOR POINT BY (Date)

    SEE SCHEDULE

11. MARK IF BUSINESS is
    [ ] SMALL
    [ ] SMALL DISADVANTAGED
    [ ] WOMEN-OWNED

12. DISCOUNT TERMS

13. MAIL INVOICES TO THE ADDRESS IN BLOCK

    See Item 15

14. SHIP TO           CODE ______________

SEE SCHEDULE
ATTN:

15. PAYMENT WILL BE MADE BY          CODE HQ0337

DFAS-COLUMBUS CENTER
NORTH ENTITLEMENT OPERATION P O BOX 182266

COLUMBUS, OH 43218-2266

MARK ALL PACKAGES AND PAPERS WITH IDENTIFICATION NUMBERS IN BLOCKS 1 AND 2.

16. TYPE OF ORDER

    DELIVERY/CALL

    PURCHASE

[X]   This delivery order/call is issued on another Govt. agency or in
      accordance with and subject to terms and conditions of above numbered
      contract.

      Reference your quote dated

      Furnish the following on terms specified herein.

      ACCEPTANCE. THE CONTRACTOR HEREBY ACCEPTS THE OFFER REPRESENTED BY THE
      NUMBERED PURCHASE ORDER AS IT MAY PREVIOUSLY HAVE BEEN OR IS NOW MODIFIED,
      SUBJECT TO ALL OF THE TERMS AND CONDITIONS SET FORTH, AND AGREES TO
      PERFORM THE SAME.


                                                                                               
_____________________________   ______________________________    ____________________________________  __________________________
   NAME OF CONTRACTOR                     SIGNATURE                       TYPED NAME AND TITLE                DATE SIGNED
                                                                                                               (YYYYMMMDD)


[ ]   If this box is marked, supplier must sign Acceptance and return the
      following number of copies:

17. ACCOUNTING AND APPROPRIATION DATA/LOCAL USE

SEE SCHEDULE

18. ITEM NO.

19. SCHEDULE OF SUPPLIES/SERVICES

20. QUANTITY ORDERED/ACCEPTED*

21. UNIT

22. UNIT PRICE

23. AMOUNT

SEE SCHEDULE

* If quantity accepted by the Government is same as quality ordered, indicate
by X. If different, enter actual quantity accepted below quantity ordered and
encicrle

24. UNITED SATES OF AMERICA

/s/ Renee M. Brown
- ----------------------------
BY: Renee M. Brown                CONTRACTING/ORDERING OFFICER

25. TOTAL $220,420.00

26. QUANTITY IN COLUMN 20 HAS BEEN

[ ] INSPECTED  [ ] RECEIVED  [ ] ACCEPTED, AND CONFORMS TO THE CONTRACT EXCEPT
                                 AS NOTED

  _________               __________________________________
    DATE                  SIGNATURE OF AUTHORIZED GOVT. RFP.

27. SHIP NO.

_____________
[ ] PARTIAL
[ ] FINAL

28. DO VOUCHER NO.

29. DIFFERENCES _____________

30. INITIALS _____________

31. PAYMENT

[ ] COMPLETE
[ ] PARTIAL
[ ] FINAL

32. PAID BY

33. AMOUNT VERIFIED CORRECT FOR

34. CHECK NUMBER

35. BILL OF LADING NO.

36. I certify this account is correct and proper for payment.

_______________    _________________________________________
     DATE          SIGNATURE AND TITLE OF CERTIFYING OFFICER

37. RECEIVED AT

38. RECEIVED BY

39. DATE RECEIVED
     (YYYYMMMDD)

40. TOTAL CONTAINERS

41. S/R ACCOUNT NO.

42. S/R VOUCHER NO.

DD FORM 1155, JAN 1998 (EG)                        PREVIOUS EDITION MAY BE USED.


CONTINUATION SHEET   REFERENCE NO. OF DOCUMENT BEING CONTINUED       PAGE
                     N00174-03-D-0003-0001                            2   OF  3

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP



                                                               MAX
ITEM NO       SUPPLIES/SERVICES                              QUANTITY   UNIT    UNIT PRICE   MAX AMOUNT
- -------       -----------------                              --------   ----    ----------   ----------
                                                                              
0001         Performance Specification Verification Models     2.00     Each    $89,400.00   $178,800.00
             (PSVM) in accordance with the Statement of
             Work and Performance Specification.

0002         Post Award Conference in                                                        $       NSP
             accordance with paragraph
             2.2.2.1 of the Statement of
             Work.

0003         Project Reviews in accordance                                                   $       NSP
             with paragraph 2.2.2.2 of the
             Statement of Work.

0004         Monthly Status Reports in  accordance with      1.00       Lot     $10,500.00   $ 10,500.00
             paragraph 2.2.3 of the Statement of Work.

0005         Safety Assessment Report in accordance          1.00       Lot     $16,000.00   $ 16,000.00
             with paragraph 2.2.4 of the Statement of
             Work and MIL-STD-882D.

0007         Operation and Maintenance Source Data in        1.00       Lot     $11,520.00   $11 ,520.00
             accordance with paragraph 2.2.6 of the
             Statement of Work.

0008         Training in accordance with paragraph           1.00       Lot     $ 3,600.00   $  3,600.00
             2.2.7.1 of the Statement of Work.




      THIS ORDER HEREBY FULFILLS THE GOVERNMENT'S GUARANTEED MINIMUM EXCEPT FOR
      ORDERS THAT MAY BE PLACED AGAINST CLIN 0009 ON AN AS NEEDED BASIS.

NSN 7540-01-152-8057       50336-101                   OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110



CONTINUATION SHEET   REFERENCE NO. OF DOCUMENT BEING CONTINUED        PAGE
                       N00174-03-D-0003-0001                            3  OF  3

NAME OF OFFEROR OR CONTRACTOR
IROBOT CORP

INSPECTION AND ACCEPTANCE TERMS

Supplies/services will be inspected/accepted at:

CLIN      INSPECT AT       INSPECT BY      ACCEPT AT        ACCEPT BY
ALL       DESTINATION      GOVERNMENT      DESTINATION      GOVERNMENT

DELIVERY INFORMATION



CLINS     DELIVERY DATE                 UNIT OF ISSUE         QUANTITY      FOB         SHIP TO ADDRESS
- -----     -------------                 -------------         --------      ---         ---------------
                                                                         
0001      270 DAYS                         Each                  2          Dest.       NAVEODTECHDIV
                                                                                        ATTN: BYRON BREZINA
                                                                                        2008 STUMP NECK ROAD,
                                                                                        BUILDING 2172
                                                                                        INDIAH HEAD, MD. 20640

0002      15 DAYS                          Lot                                          SAME AS CLIN 0001
0003      At least 2 weeks prior to        Lot                                          SAME AS CLIN 0001
          the delivery of CLIN 0001
0004      45 DAYS                          Lot                   1          Dest.       SAME AS CLIN 0001
0005      120 DAYS                         Lot                   1          Dest.       SAME AS CLIN 0001
0007      270 DAYS                         Lot                   1          Dest.       SAME AS CLIN 0001
0008      270 DAYS                         Lot                   1          Dest.       SAME AS CLIN 0001


ACCOUNTING AND APPROPRIATION DATA

AA: 1731319.8998 250 0464A 0 068892 2D Q00288 0464A395206Q           $220,420.00

NSN 7540-01-152-8057            50336-101              OPTIONAL FORM 336A (4-86)
                                                       Sponsored by GSA
                                                       FAR (48 CFR) 53.110

                                                                    Exhibit 23.2




            CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the use in this Registration Statement on Form S-1 of our
report dated May 4, 2005, except for Note 17, as to which the date is May 26,
2005 relating to the financial statements of iRobot Corporation, which appears
in such Registration Statement.  We also consent to the reference to us under
the heading "Experts" in such Registration Statement.

/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
July 27, 2005

[GOODWIN PROCTER LLP LETTERHEAD]


                                              Edward A. King
                                              Goodwin Procter LLP
                                              Exchange Place
                                              BOSTON, MA 02109
                                              617 570-1346
                                              617 523-1231 fax
                                              eking@goodwinprocter.com

July 27, 2005

BY ELECTRONIC SUBMISSION

Securities and Exchange Commission
450 Fifth Street, N.W.
Judiciary Plaza
Washington, DC  20549

Re:      iRobot Corporation
         Registration Statement on Form S-1

Ladies and Gentlemen:

         Submitted herewith for filing on behalf of iRobot Corporation (the
"Company") is a Registration Statement on Form S-1 relating to the registration
under the Securities Act of 1933, as amended (the "Securities Act") of shares of
Common Stock of the Company.

         This filing is being effected by direct transmission to the
Commission's EDGAR System. On July 26, 2005, in anticipation of this filing, the
Company caused the filing fee of $13,536 to be wire transferred to the
Commission's account at the Mellon Bank in Pittsburgh.

         The Registration Statement relates to the Company's initial public
offering of securities. It is the intent of the Company and the managing
underwriters of the proposed offering to have the Registration Statement
declared effective as early as possible.

         Acceleration requests may be made orally, and the Company and the
managing underwriters of the proposed offering have authorized us to represent
on their behalf that they are aware of their obligations under the Securities
Act with respect thereto.





July 27, 2005
Page 2

         Please contact the undersigned or Mark T. Bettencourt at 617-570-1091
with any questions or comments you may have regarding this filing.

Very truly yours,





/s/ Edward A. King

Edward A. King