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| | If the exercise price of any stock option that I elect to exchange in the exchange offer is less than the greater of (1) $13.00 or (2) 40% of the above the 90-day average closing price of iRobots common stock on the NASDAQ Global Market (NASDAQ) for the business day on which the exchange offer closes, then any such stock option will not be deemed to be an eligible option and therefore will not be accepted by iRobot for exchange; | |
| | Upon acceptance by iRobot, this election will constitute a binding agreement between iRobot and me; | |
| | If I validly tender a stock option for exchange, and such stock option is accepted and cancelled, I will receive a new option exercisable for fewer shares of iRobots common stock than the tendered stock option based upon the exchange ratios outlined in Section 8 of the Offer to Exchange; | |
| | The exercise price of the new options will be equal to the closing price of iRobots common stock as reported by NASDAQ on the date the new options are granted; | |
| | In general, subject to my continuing service to iRobot, each new option will become vested and exercisable as follows: if and to the extent the corresponding exchanged stock option was exercisable as of the grant date of the new option, a like portion of the new option will become exercisable on the first anniversary of the grant date; and if and to the extent the corresponding exchanged stock option was not exercisable as of the grant date of the new option, a like portion of the new option will become exercisable one year from the date(s) as of which the exchanged stock option would have become exercisable in accordance with its terms; | |
| | All new options will be non-qualified stock options for federal income tax purposes, regardless of the tax status of the exchanged stock options; | |
| | The new options will be granted under and subject to the provisions of iRobots 2005 Stock Option and Incentive Plan (the 2005 Plan); | |
| | iRobot has advised me to consult with my own financial and tax advisors as to the consequences of participating or not participating in the exchange offer; | |
| | To remain eligible to tender stock options for exchange and cancellation pursuant to the exchange offer, I must remain an eligible participant, including being employed by iRobot in the United States on the date the new options are granted, and if I die or cease being employed by iRobot in the United States prior to the date the new options are granted, iRobot will not accept my tendered stock options for cancellation; | |
| | I understand that neither the ability to participate in the exchange offer nor actual participation in the exchange offer will be construed as a right to continued employment with iRobot; | |
| | In accordance with Sections 6 and 14 of the Offer to Exchange, iRobot may terminate, modify or amend the exchange offer and postpone its acceptance and cancellation of any stock option that I have |
| tendered for exchange. In any such event, I understand that stock options tendered for exchange but not accepted will remain in effect with their current terms and conditions. In particular, I understand that if the proposal regarding the amendment to the 2005 Plan and the exchange offer is not approved by iRobots stockholders at the Annual Meeting of Stockholders scheduled for May 28, 2009, iRobot will terminate the exchange offer and will not be able to accept any of the stock options that may have been tendered; |
| | This election is entirely voluntary, and I am aware that I may change or withdraw my decision to tender my stock options at any time until the exchange offer expires as described above and in the Offer to Exchange. I understand that this decision to tender my stock options will be irrevocable at 5:00 p.m., Eastern Time, on May 29, 2009, unless the exchange offer is extended; | |
| | I sell, assign and transfer to iRobot all right, title and interest in and to all of the eligible options that I am tendering, and I agree that I shall have no further right or entitlement to purchase any shares of iRobots common stock under the tendered eligible options on the date iRobot accepts such stock options for exchange and cancellation. All of my obligations under this Election Form will be binding upon my heirs, personal representatives, successors and assigns; and | |
| | I agree to all of the terms and conditions of the exchange offer. |