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WATCH OUT! was an artificial intelligence. It was used by Cinnabar Flynn on Yemaya 4 for searches and tinkering in the computer system.
When the Dione-Kisumu Company sent troops to investigate the outbreak of the psychic virus in the colony in 2257, the Seventh Doctor had BAR B, CONNECTICUT and WATCH OUT! assimilate code that made them independent entities. They then were able to help him save the colony without the Company being able to countermand their activities. Afterwards, it helped integrate LEONARDO into the colony. (PROSE: SLEEPY)