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KIVA SYSTEMS ANNOUNCES AVAILABILITY OF BREAKTHROUGH MOBILE FULFILLMENT SYSTEM

Staples to deploy Kiva system in Chambersburg delivery facility

Woburn, MA - December 19, 2005 - Kiva Systems, Inc., today announced the general availability of the breakthrough Kiva Mobile Fulfillment System. A revolutionary approach to material handling for order fulfillment, the Kiva MFS employs hundreds of low-cost mobile robots to bring inventory shelving pods directly to operators resulting in triple the number of orders per hour per person. Staples, Inc. has purchased a Kiva MFS for deployment in their Chambersburg, PA fulfillment center.

After several years of development and pilot testing, I'm very pleased to announce the availability of the Kiva Mobile Fulfillment System, said Mick Mountz, founder and CEO of Kiva Systems. The industry has long been searching for a way to improve order fulfillment operations and customers are telling us that Kiva is that game-changing technology.

Staples first conducted a pilot test of the Kiva system in their Coppell, Texas, fulfillment center where office supply orders are packed for delivery to business and home office customers. The Kiva solution was so simple yet potentially powerful that we decided to put it to the test in a live production environment earlier this year, said Don Ralph, senior vice president of Logistics Operations for Staples North American Delivery, Staples, Inc. The resulting increase in productivity was significant, and we've decided to move forward with a permanent installation in our Chambersburg facility.

The Chambersburg facility is one of many Staples fulfillment centers that provide fast delivery to home office and small business customers placing orders via Staples.com® and Staples catalogs as well as corporate customers that order primarily via StaplesLink.com®.

The Kiva Mobile Fulfillment System is a type of automated storage and retrieval technology that brings any item to any operator at any time regardless of the breadth of inventory items or the throughput of the facility. Operators stand at pick stations along the perimeter of the facility where they use an innovative pick-to-light put-to-light process to select items and place them in the correct shipping container. Kiva's solution solves many fulfillment center design challenges simultaneously, said Larry Plourde, Director of Fulfillment Center Operations and Logistic Systems at Staples. Using one simple system, they've achieved infinite pick-face density with zero walking, concurrent picking and replenishment, pick-to-light across all product velocities, potential for real-time order processing with cycle time in minutes, and zero location profiling or re-slotting.

Operators like Staples also benefit from the modular design of the Kiva MFS, which means that a system can be installed in one day and re-configured as needed. This flexibility supports growing operations as they can add capacity on very short planning cycles. The inventory pods accommodate a wide range of SKUs from refrigerators to pens to shirts to plates so the operation has the flexibility to grow and adapt as business needs change.

About Kiva Systems

Kiva Systems, Inc. provides a breakthrough mobile solution for the dynamic storage, movement and sortation of inventory, enabling unprecedented productivity and flexibility in fulfillment operations. An innovative combination of mobile hardware and powerful software, Kiva’s modular systems deliver any item to any operator at any time. The results are higher productivity and shorter cycle times with a system that is easy to install and expand. For more information on Kiva Systems and its solutions, please visit www.kivasystems.com

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