S-1

As filed with the Securities and Exchange Commission on December 19, 2007

Registration No. 333-            

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-1

REGISTRATION STATEMENT

Under

THE SECURITIES ACT OF 1933

DANGER, INC.

(Exact name of registrant as specified in its charter)

Delaware	7371	77-0529259
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)

3101 Park Blvd.

Palo Alto, CA 94306

(650) 289-5000

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Henry R. Nothhaft

Chairman and Chief Executive Officer

Danger, Inc.

3101 Park Blvd.

Palo Alto, CA 94306

(650) 289-5000

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Mark P. Tanoury, Esq. John M. Geschke, Esq. Cooley Godward Kronish LLP Five Palo Alto Square 3000 El Camino Real Palo Alto, CA 94306 Telephone: (650) 843-5000 Scott L. Darling, Esq. Vice President and General Counsel Danger, Inc. 3101 Park Blvd. Palo Alto, CA 94306 Telephone: (650) 289-5000 Robert G. Day, Esq. Allison B. Spinner, Esq. Wilson Sonsini Goodrich & Rosati, Professional Corporation 650 Page Mill Road Palo Alto, CA 94304-1050 Telephone: (650) 493-9300

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ¨

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering. ¨

CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered	Proposed maximum aggregate offering price(1)(2)	Amount of registration fee
Common Stock, $0.0001 par value per share	$100,050,000	$3,072

(1) Estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rule 457(o) under the Securities Act of 1933, as amended.

(2) Includes $13,050,000 of shares that the underwriters have the option to purchase to cover over-allotments, if any.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment that specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

Subject to Completion, dated                     , 2007

The information in this prospectus is not complete and may be changed. We may not 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 we are not soliciting offers to buy these securities in any state where the offer or sale is not permitted.

PRELIMINARY PROSPECTUS

            Shares

Danger, Inc.

Common Stock

This is our initial public offering of shares of our common stock. No public market currently exists for our common stock. The initial public offering price of our common stock is expected to be between $             and $             per share.

We have applied to list our common stock on the NASDAQ Global Market under the symbol “DNGR.”

Investing in our common stock involves risks. See “ Risk Factors” beginning on page 10.

	Per Share	Total
Initial public offering price	$	$
Underwriting discounts and commissions	$	$
Proceeds to us (before expenses)	$	$

We have granted the underwriters a 30-day option to purchase up to an additional              shares from us on the same terms and conditions as set forth above if the underwriters sell more than              shares of common stock in this offering.

Neither the Securities and Exchange Commission nor any state securities regulator has approved or disapproved of these securities nor determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the shares on or about                      , 2008.

Deutsche Bank Securities UBS Investment Bank

	Thomas Weisel Partners LLC
Pacific Crest Securities		ThinkEquity Partners LLC

                    , 2008

TABLE OF CONTENTS

	Page
Prospectus Summary	1
Risk Factors	10
Forward-Looking Statements	38
Use of Proceeds	39
Dividend Policy	39
Capitalization	40
Dilution	42
Selected Consolidated Financial Data	45
Management’s Discussion and Analysis of Financial Condition and Results of Operations	47
Business	73
Management	90
Executive and Director Compensation	96
Certain Relationships and Related Party Transactions	122
Principal Stockholders	129
Description of Capital Stock	133
Shares Eligible for Future Sale	139
Material United States Federal Tax Considerations for Non-United States Holders of Common Stock	142
Underwriting	145
Legal Matters	149
Experts	149
Where You Can Find More Information	149
Index to Consolidated Financial Statements	F-1

You should rely only on the information contained in this prospectus or any related free writing prospectus we may authorize to be delivered to you. We have not, and the underwriters have not, authorized anyone to provide you with information different from, or in addition to, that contained in this prospectus or any related free writing prospectus. If anyone provides you with different or inconsistent information, you should not rely on it. We are offering to sell, and are seeking offers to buy, shares of common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus or any related free writing prospectus is accurate only as of its date, regardless of its time of delivery, or of any sale of the common stock. Our business, financial condition, results of operations and prospects may have changed since that date.

Until and including                     , 2008 (25 days after the date of this prospectus), all dealers that buy, sell or trade our common stock, whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

For investors outside of the United States: neither we nor any of the underwriters have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. You are required to inform yourselves about and to observe any restrictions relating to this offering and the distribution of this prospectus.

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PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. You should read the following summary together with the entire prospectus and our consolidated financial statements and the related notes appearing elsewhere in this prospectus. You should carefully consider, among other things, the matters discussed in the section entitled “Risk Factors.”

Our Company

Overview

We are a software-as-a-service company that provides mobile operators with an integrated end-to-end solution to deliver mobile data and Internet services to their subscribers. As advanced Internet and messaging services are increasingly becoming available on mobile devices, our solution enables operators to offer their subscribers a differentiated and compelling mobile data and Internet experience and consequently, helps our operator customers increase their average revenue per user. Our solution is deployed in the United States and certain international markets through the T-Mobile Sidekick family of mobile devices and in other international markets, including Australia and Europe, through mobile devices utilizing our “hiptop” brand.

The Danger solution integrates our hosted service delivery engine, or SDE, and our client software with Danger-enabled mobile devices manufactured by Sharp Corporation and Motorola, Inc., our original equipment manufacturer, or OEM, partners. Our technology platform enables fast subscriber access to data services, provides data compression and optimization, and provides users with the ability to run multiple applications simultaneously. Our solution offers real-time email, instant messaging and social networking services, and HTML web browsing, as well as premium applications, content and services developed internally and through our third-party developer program.

We leverage the expertise and scale of our mobile operator customers and our OEM partners to help manufacture, market and distribute Danger-enabled mobile devices to a broad consumer audience. By delivering the Danger solution as a service, we allow our mobile operator customers to leverage our infrastructure, third-party developer program and expertise in deploying an end-to-end mobile data service offering with minimal capital investment.

We receive recurring monthly service fees from our mobile operator customers for each subscriber that has access to our mobile data services, and we also generate revenues from the premium applications, content and services that we provide. From the introduction of our solution in October 2002 through September 30, 2007, the number of subscribers to our mobile data services has grown to approximately 923,000. Our total revenues have grown from $49.3 million in the year ended September 30, 2006 to $56.4 million in the year ended September 30, 2007, and our service revenues have grown from $38.9 million in the year ended September 30, 2006 to $50.6 million in the year ended September 30, 2007.

Industry Background

The mobile data services market is in a period of transition and growth fueled by consumer adoption, mobile operator competition, advances in mobile device technologies and the convergence of the traditional Internet and mobile communications industries. As a result of these trends, mobile devices are no longer predominantly used for a single function, such as voice, but are increasingly becoming an important platform for multiple forms of communication, access to information, consumption of media and content creation.

Our Solution

The Danger solution powers advanced data applications and services on Danger-enabled mobile devices, and features premium applications, content and services developed internally and through our third-party

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developer program. The Danger solution is designed to be easy for our mobile operator customers to deploy and manage, and to integrate seamlessly with their back-end systems. Key features of the Danger solution include the following:

Superior mobile data and Internet experience for consumers.    The Danger solution adds real-time email, popular instant messaging and social networking services, HTML web browsing, and easy access to premium applications, content and services to standard voice and personal information management features, and provides an intuitive user-interface to mimic a personal computer experience on a mobile device.

End-to-end integrated mobile data and Internet solution for mobile operators.    We offer mobile operators a single, tightly-integrated solution that enables them to capitalize on advances in mobile devices, network technologies and Internet services to offer consumers a more compelling mobile data and Internet experience.

Powerful technology platform enabling optimized delivery of enhanced mobile data services.    The Danger technology platform, which consists of our hosted SDE and client software for mobile devices, optimizes the delivery of enhanced mobile data services by compressing content, managing network and device communications, facilitating the real-time delivery of software upgrades and additional features, and synchronizing and storing data in a manner easily accessible by the consumer.

Close collaboration with mobile device manufacturers.    We collaborate closely with our OEM partners throughout the design and development process of Danger-enabled mobile devices, allowing us to better integrate our software into their devices and to optimize performance, minimize design flaws and accelerate device development.

Large and growing third-party developer program.    Our third-party developer program is designed to foster a steady and competitive pipeline of premium applications, content and services for distribution on our platform that we believe enhance the overall consumer experience.

Leveraged, software-as-a-service business model aligned with customer interests.    We deploy our solution through a software-as-a-service business model that enables us to leverage the reach and expertise of our mobile operator customers, OEM partners and third-party developers so we can scale rapidly while minimizing our investment.

Our Strategy

Our objective is to expand our position as a leading provider of mobile consumer data services and to increase the value of our solution for mobile operators worldwide. The principal elements of our strategy are to:

• extend our leadership position by strengthening and broadening our solution;

• pursue new mobile operator relationships and expand our distribution globally;

• extend and deepen our OEM partnerships;

• increase the number of subscribers using our mobile data services; and

• expand the development of third-party applications, content and services for our platform.

Risks Related to Our Business

Our business and our ability to execute on our business strategy are subject to a number of risks that you should be aware of before making an investment decision. These risks are discussed more fully in the section entitled “Risk Factors” immediately following this prospectus summary. For example:

• We have a history of net losses, may incur substantial net losses in the future and may not achieve profitability in the future. As of September 30, 2007, we had an accumulated deficit of $188.1 million.

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• We are substantially dependent on T-Mobile USA, Inc., or T-Mobile USA, for our revenues and if we fail to maintain our relationship with T-Mobile USA or if T-Mobile USA reduces its expenditures for marketing our mobile data services, alters the data plan pricing under which it offers our mobile data services, or offers or promotes competing mobile data services in lieu of, or to a greater degree than, our mobile data services, our revenues would be materially and substantially reduced.

• The mobile data services we provide run exclusively on Danger-enabled mobile devices that are manufactured and sold by our OEM partners. If our OEM partners delay the development of, elect not to develop or fail to ship mobile devices that run our mobile data services, our business, operating results and financial condition would be materially harmed.

• We have a limited operating history in an emerging industry, which may make it difficult to evaluate our business. In particular, we have a limited history of generating revenues solely as a provider of mobile data services, and the future revenue potential of our business in the emerging mobile data services industry is still uncertain.

• We operate in a highly competitive industry and we may not be able to compete effectively. In addition, recent developments in the mobile device and mobile services markets, such as the formation of the Google-led Open Handset Alliance, as well as the introduction of new wireless technologies and new entrants seeking to gain market share, could harm our competitive position.

• Our success is strongly tied to the popularity of our mobile data services platform and Danger-enabled mobile devices with subscribers and is subject to risks associated with unpredictable and continuously changing customer tastes.

• There is a limited number of mobile operator customers for our mobile data services solution, and we are substantially dependent on our mobile operator customers to market and distribute Danger-enabled mobile devices. If mobile operator customers do not introduce, market and promote Danger-enabled mobile devices, our mobile data services solution will not achieve widespread acceptance and we may not be able to grow as fast as anticipated, or at all.

• We operate in an industry with extensive intellectual property litigation. Claims of infringement against us, our OEM partners or our mobile operator customers could cause our business, financial condition and results of operations to suffer.

Corporate Information

We were incorporated in December 1999, originally operated under the name “Danger Research,” and are headquartered in Palo Alto, California. Our principal executive offices are located at 3101 Park Blvd., Palo Alto, California 94306. Our telephone number is (650) 289-5000. Our website address is www.danger.com. Information contained on our website is not incorporated by reference into this prospectus, and you should not consider information contained on our website to be part of this prospectus.

We own the trademarks “Danger^®” and “hiptop^®,” and our other trademarks or service marks appearing in this prospectus. This prospectus contains additional trade names, trademarks and service marks of other companies. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies.

Market Data

This prospectus contains market data and industry forecasts that were obtained from industry publications. We have not independently verified any of this information.

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The Offering

Common stock offered by Danger              shares

Common stock to be outstanding after this offering              shares

Over-allotment option              shares

Use of proceeds We intend to use approximately $7.2 million of the net proceeds of this offering to repay in full the principal and accrued interest under, and other fees related to, certain of our outstanding credit facilities, based on amounts outstanding as of November 30, 2007. We expect to use the remaining net proceeds of this offering for working capital and other general corporate purposes, including to finance the expansion and operation of our data centers, to fund capital expenditures and to support our research and development and sales and marketing activities, or for acquisitions of or investments in companies, technologies, products or other assets. See “Use of Proceeds.”

Proposed NASDAQ Global Market symbol DNGR

The number of shares of common stock outstanding immediately after this offering is based on              shares of common stock outstanding as of September 30, 2007. This number excludes, as of September 30, 2007:

• 42,861,396 shares of common stock issuable upon the exercise of options outstanding under our 2000 Stock Option/Stock Issuance Plan, or 2000 plan, having a weighted average exercise price of $0.35 per share;

• 6,525,841 shares of common stock issuable upon the exercise of outstanding warrants, having a weighted average exercise price of $0.83 per share, of which warrants to purchase 6,415,222 shares of common stock will terminate if not exercised prior to the closing of this offering;

• 2,056,194 shares of common stock reserved for future issuance under our 2000 plan; provided, however, that immediately upon the signing of the underwriting agreement for this offering, no further awards will be granted under our 2000 plan; and

• an aggregate of up to              shares of common stock reserved for future issuance under our 2008 Equity Incentive Plan and 2008 Employee Stock Purchase Plan, as well as any automatic increases in the number of shares of our common stock reserved for future issuance under these benefit plans, both of which will become effective immediately upon the signing of the underwriting agreement for this offering.

Except as otherwise indicated, all information in this prospectus assumes:

• a  -for-  reverse stock split of our common stock and preferred stock to be effective prior to the closing of this offering;

• the conversion of all of our outstanding shares of preferred stock into 168,133,864 shares of common stock upon the closing of this offering;

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• the filing of our amended and restated certificate of incorporation upon the closing of this offering;

• no exercise of the underwriters’ over-allotment option; and

• the exercise of warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, resulting in the net issuance of              shares of common stock, assuming a deemed market price equal to the assumed initial public offering price of $             per share, the mid-point of the price range reflected on the cover page of this prospectus. The actual number of shares of our common stock to be issued upon the automatic cashless exercise of these warrants depends on the deemed market price of our common stock immediately prior to the date of exercise. See “Capitalization” and “Description of Capital Stock—Warrants.”

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Summary Consolidated Financial Data

We present below our summary consolidated financial data. The summary of our consolidated statements of operations data for each of the years ended September 30, 2005, 2006 and 2007, and the summary of our consolidated balance sheet data as of September 30, 2007, have been derived from our audited consolidated financial statements included elsewhere in this prospectus. You should read this information together with our consolidated financial statements and related notes included elsewhere in this prospectus and the information under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Selected Consolidated Financial Data.” Our historical results are not necessarily indicative of the results to be expected in any future period.

	Years Ended September 30,
	2005			2006			2007
	(In thousands, except per share data)
Consolidated Statements of Operations Data:
Revenues:
Service	$	21,669		$	38,895		$	50,581
Product		15,121			10,416			5,832
Total revenues		36,790			49,311			56,413
Cost of revenues:
Cost of service revenues		10,701			17,755			26,846
Cost of product revenues		16,220			9,130			5,276
Total cost of revenues		26,921			26,885			32,122
Gross profit		9,869			22,426			24,291
Operating expenses:
Research and development		11,317			17,746			22,497
Sales and marketing		5,211			5,723			7,020
General and administrative		3,610			6,999			6,541
Total operating expenses		20,138			30,468			36,058
Loss from operations		(10,269	)		(8,042	)		(11,767	)
Other income (expense), net		359			107			(520	)
Loss before provision for income taxes and cumulative effect of change in accounting principle		(9,910	)		(7,935	)		(12,287	)
Provision for income taxes		—			(54	)		(74	)
Loss before cumulative effect of change in accounting principle		(9,910	)		(7,989	)		(12,361	)
Cumulative effect of change in accounting principle		—			1,421			—
Net loss		(9,910	)		(6,568	)		(12,361	)
Accretion of redemption value on redeemable convertible preferred stock		(12,309	)		(14,477	)		(15,710	)
Net loss attributable to common stockholders	$	(22,219	)	$	(21,045	)	$	(28,071	)
Net loss per share attributable to common stockholders—basic and diluted:
Loss before cumulative effect of change in accounting principle	$	(0.69	)	$	(0.53	)	$	(0.76	)
Cumulative effect of change in accounting principle		—			0.09			—
Accretion of redemption value on redeemable convertible preferred stock		(0.85	)		(0.95	)		(0.96	)
Net loss per share attributable to common stockholders—basic and diluted	$	(1.54	)	$	(1.39	)	$	(1.72	)
Weighted average common shares outstanding—basic and diluted		14,396			15,142			16,353
Pro forma net loss per share—basic and diluted (unaudited)(1)							$	(0.06	)
Pro forma weighted average common shares outstanding—basic and diluted (unaudited)(1)								184,463

(1) Please see Note 3 to our consolidated financial statements for an explanation of the method used to compute pro forma basic and diluted net loss per common share and the number of shares used in computing per share amounts.

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The following table presents our summary consolidated balance sheet data:

• on an actual basis;

• on a pro forma basis to give effect to:

• the conversion of all of our outstanding shares of our preferred stock into 168,133,864 shares of common stock upon the closing of this offering;

• the exercise of warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, resulting in the net issuance of              shares of common stock, assuming a deemed market price equal to the assumed initial public offering price of $             per share, the mid-point of the price range reflected on the cover page of this prospectus; and

• the reclassification of preferred stock warrant liability to common stock and additional paid-in capital upon the closing of this offering; and

• on a pro forma as adjusted basis to give further effect to the sale by us of              shares of common stock in this offering at an assumed initial public offering price of $             per share, after deducting underwriting discounts and commissions and estimated offering expenses payable by us, and the repayment of amounts outstanding under an equipment lease line, which had an outstanding balance of approximately $3.8 million as of September 30, 2007.

	As of September 30, 2007
	Actual			Pro Forma	Pro Forma As Adjusted(1)
	(In thousands)
Consolidated Balance Sheet Data:
Cash and cash equivalents	$	12,979
Working capital		8,961
Property and equipment, net		17,358
Total assets		49,024
Deferred revenues, including current portion		10,630
Installment payable, including current portion		885
Capital lease obligations, including current maturities		4,501
Preferred stock warrant liability		12,180
Redeemable convertible preferred stock		197,623
Common stock and additional paid-in capital		1,689
Total stockholders’ equity (deficit)		(186,412	)

(1) Each $             increase (decrease) in the assumed initial public offering price of $             per share would increase (decrease) each of cash and cash equivalents, working capital, total assets and total stockholders’ equity by approximately $             million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. We may also increase or decrease the number of shares we are offering. Each increase (decrease) of shares in the number of              shares offered by us would increase (decrease) each of cash and cash equivalents, working capital, total assets and total stockholders’ equity by approximately $             million, assuming that the assumed initial public offering price remains the same, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. The pro forma as adjusted information discussed above is illustrative only and will adjust based on the actual initial public offering price and other terms of this offering determined at pricing.

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	Years Ended September 30,
	2005			2006			2007
	(In thousands)
Other Financial and Operating Data (unaudited):
End of period subscribers(1)		348			563			923
Adjusted EBITDA(2)	$	(6,961	)	$	(3,574	)	$	(5,700	)

(1) Represents the number of mobile operator customers’ subscribers using our mobile data services as of September 30, 2005, 2006 and 2007.

(2) We define adjusted EBITDA as net loss before the cumulative effect of change in accounting principle, the provision for income taxes, other income (expense), net, depreciation and amortization expense, and non-cash charges in relation to performance warrants and stock-based compensation expense. Adjusted EBITDA is not a measure of liquidity calculated in accordance with U.S. generally accepted accounting principles, or GAAP, and should be viewed as a supplement to—not a substitute for—our consolidated results of operations presented on the basis of GAAP. Adjusted EBITDA does not purport to represent cash flows provided by, or used in, operating activities as defined by GAAP. Our consolidated statements of cash flows present our cash flow activity in accordance with GAAP. Furthermore, adjusted EBITDA is not necessarily comparable to similarly-titled measures reported by other companies.

We believe that the presentation of adjusted EBITDA provides useful information to investors because it enhances their overall understanding of our operating performance by excluding potential differences caused by variations to our:

• interest income and expense due to changes in our capital structure, including our credit facility drawdowns and historical sales of our redeemable convertible preferred stock;

• tax positions, such as the impact of changes in effective tax rates and our ability to use net operating losses and their potential for expiration;

• depreciation and amortization expense, including depreciation and amortization expense arising from variable and periodic capital investments to fund our operational infrastructure;

• stock-based compensation expense, which is not necessarily comparable from year to year due to our adoption of SFAS No. 123(R), Share-Based Payment, or SFAS 123(R), effective October 1, 2006, and is a non-cash expense that is not a primary measure of our operations; and

• unusual and/or non-recurring items, such as the cumulative effect of change in accounting principle and non-cash charges in relation to performance warrants.

We also believe that by reporting adjusted EBITDA, we provide insight and consistency in our financial reporting and present a basis for comparison of our business operations between current, past and future periods.

We understand that although adjusted EBITDA is frequently used by securities analysts, lenders and others in their evaluation of companies, adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of, our consolidated results of operations as reported under GAAP. Some of these limitations are:

• adjusted EBITDA does not reflect our cash expenditures for, or future requirements for, capital expenditures or contractual commitments;

• adjusted EBITDA does not reflect changes in our cash requirements;

• adjusted EBITDA does not reflect the interest expense, or the cash requirements necessary to service interest or principal payments related to our credit facilities;

• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and adjusted EBITDA does not reflect any cash requirements for such replacements; and

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• other companies in our industry may calculate adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.

A reconciliation of adjusted EBITDA to net loss, the most directly comparable GAAP measure, for each of the years ended September 30, 2005, 2006 and 2007 is as follows (in thousands):

	Years Ended September 30,
	2005			2006			2007
Net loss	$	(9,910	)	$	(6,568	)	$	(12,361	)
Cumulative effect of change in accounting principle		—			(1,421	)		—
Provision for income taxes		—			54			74
Other (income) expense, net		(359	)		(107	)		520
Depreciation and amortization expense		2,546			3,604			5,713
Non-cash charges in relation to performance warrants		729			860			—
Stock-based compensation expense		33			4			354
Adjusted EBITDA	$	(6,961	)	$	(3,574	)	$	(5,700	)

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RISK FACTORS

You should carefully consider the risks described below, which we believe are the material risks of our business, our industry and this offering, before making an investment decision. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. If any of the following risks actually occurs, our business, financial condition and results of operations could be harmed. In that case, the trading price of our common stock could decline and you might lose all or part of your investment in our common stock. In assessing these risks, you should also refer to the other information contained in this prospectus, including our consolidated financial statements and the related notes.

Risks Related to Our Business

We have a history of net losses, may incur substantial net losses in the future and may not achieve profitability in the future.

We have incurred significant losses since inception, including net losses of $6.6 million and $12.4 million for the fiscal years ended September 30, 2006 and 2007, respectively. As of September 30, 2007, we had an accumulated deficit of $188.1 million. We expect to continue to increase our costs and expenses as we implement initiatives and take other actions designed to continue to grow our business, including, among other things:

• further international expansion of our customer base and our operations;

• development and marketing of our mobile data services;

• expansion of our hosting capabilities and other service infrastructure;

• increasing our internal resources to support our original equipment manufacturer, or OEM, partners’ development of new products; and

• general and administrative expenses associated with the planned expansion and management of operations as a public company.

Additionally, we may encounter unforeseen difficulties, complications and other unknown factors that require additional expenditures. If our revenues do not increase to offset these expected increases in our costs and expenses, we will continue to incur significant losses and will not become profitable. Our revenue growth in recent periods should not be considered indicative of our future performance. In fact, in future periods, our revenues could decline and we may not be able to achieve profitability in the future.

We are substantially dependent on T-Mobile USA for our revenues.

Substantially all of our revenues to date have been derived from one customer, T-Mobile USA, Inc., or T-Mobile USA, and we expect to be dependent on T-Mobile USA for a substantial majority of our revenues for the foreseeable future. During the years ended September 30, 2005, 2006 and 2007, we derived approximately 92.1%, 88.5% and 92.0% of our revenues from T-Mobile USA, respectively. During the years ended September 30, 2006 and 2007, our mobile operator customers in the T-Mobile International group, which include T-Mobile USA, T-Mobile Deutschland GmbH, T-Mobile (UK) Limited and T-Mobile Austria GmbH, represented 90.9% and 94.5% of our revenues, respectively. Our current agreement with T-Mobile USA will expire on December 31, 2008. T-Mobile USA has the right, but not the obligation, to renew our current agreement for a single additional period of up to three years, unless we notify T-Mobile USA of our intent not to renew. In addition, T-Mobile USA has the right to terminate the agreement in the event of certain breaches by us, including the right to immediately terminate the agreement if we improperly disclose information about T-Mobile USA’s subscribers. Our failure to renew or renegotiate this agreement on favorable terms or at all, or to otherwise maintain our relationship with T-Mobile USA, would materially reduce our revenues and harm our business, operating results and financial condition. In addition, if T-Mobile USA reduces its expenditures for

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marketing our mobile data services, alters the data plan pricing under which it offers our mobile data services, or offers and promotes competing mobile data services, such as those as may be developed under the Open Handset Alliance discussed below, in lieu of, or to a greater degree than, our mobile data services, our revenues would be materially reduced and our business, operating results and financial condition would be materially and adversely affected.

We currently rely on two OEM partners to manufacture Danger-enabled mobile devices. If our OEM partners have difficulties manufacturing or shipping Danger-enabled mobile devices, our business will suffer.

The mobile data services we provide run exclusively on Danger-enabled mobile devices manufactured and sold by our OEM partners. If our OEM partners delay the development of, elect not to develop or fail to ship mobile devices that run our mobile data services, our business, operating results and financial condition would be materially harmed. Our OEM partners are not contractually obligated to ship Danger-enabled mobile devices that they develop.

In April 2004, we established our first OEM relationship with Sharp Corporation, or Sharp, under which Sharp manufactures and sells Danger-enabled mobile devices. From April 2004 until September 2006, Sharp was our only OEM partner. If Sharp delays or ceases manufacturing current Danger-enabled mobile devices and/or delays or discontinues its development of future Danger-enabled mobile devices, our business, operating results and financial condition would be materially harmed.

In September 2006, we established our second OEM relationship with Motorola, Inc., or Motorola. Motorola’s first Danger-enabled mobile device launched in November 2007 with T-Mobile USA. If this or any future Danger-enabled mobile devices manufactured by Motorola are not purchased in volume by mobile operators or are not adopted by consumers in the marketplace, our business, operating results and financial condition would be materially harmed.

We have a limited operating history in an emerging industry, which may make it difficult to evaluate our business.

We were incorporated in December 1999 and the first Danger-enabled mobile device was launched in October 2002. Under our initial mobile operator customer contracts, we were responsible for the manufacture, sale and after-market support of Danger-enabled mobile devices. In April 2004, we changed our business model by licensing the reference design for our Danger-enabled mobile device to Sharp and allowing Sharp to assume direct responsibility for the manufacture and sale of Danger-enabled mobile devices to our mobile operator customers. We expect our OEM partners to continue to be responsible for the future manufacture of Danger-enabled mobile devices that run our mobile data services. As a result, we have a limited history of generating revenues solely as a provider of a mobile data services solution, and the future revenue potential of our business in the emerging mobile data services industry is still uncertain. Any evaluation of our business and our prospects must be considered in light of our limited operating history and the risks and uncertainties encountered by companies in our stage of development. As a relatively early stage company in the emerging mobile data services industry, we face increased risks, uncertainties and difficulties related to:

• retaining our current economic arrangements with mobile operator customers;

• maintaining and expanding our current, and developing new, mobile operator relationships;

• maintaining and expanding our current, and developing new, relationships with OEM partners;

• developing new innovative and high-quality mobile data services that achieve significant market acceptance;

• developing and upgrading our mobile data services platform to incorporate new technologies;

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• maintaining a stable service infrastructure and reliable service delivery to our mobile operator customers;

• expanding our service infrastructure to handle growth in subscribers and growth in application usage;

• keeping subscriber turnover, or subscribers switching to other mobile data services, at acceptable levels;

• executing our business and marketing strategies successfully;

• responding to competitive developments; and

• attracting, integrating and retaining qualified personnel.

Failure to achieve any of these objectives could harm our business. In addition, the costs to overcome these risks may be more expensive than planned, which could adversely impact our operating results and financial condition.

We operate in a highly competitive industry, and many of our competitors have significantly greater resources than we do.

The markets for development, distribution and sale of mobile devices and mobile data services are highly competitive. This competition could make it more difficult for us to sell our mobile data services solution, and could result in increased pricing pressure, reduced profit margins, increased sales and marketing expenses and failure to increase, or the loss of, market share or expected market share, any of which would likely cause serious harm to our business, operating results and financial condition.

Many of our competitors have greater name recognition, larger customer bases and significantly greater financial, technical, marketing, public relations, sales, distribution and other resources than we do. Our primary competitors include integrated mobile data service providers such as Research in Motion Limited, which markets BlackBerry wireless devices, as well as smartphone software providers such as Microsoft Corporation and Symbian Software Limited. We also face competition from mobile device manufacturers and mobile virtual network operators, or MVNOs, that market devices and services that compete with Danger-enabled mobile devices and our mobile data services. These include OEMs such as Palm, Inc., Nokia Corporation, Samsung Electronics, Apple, Inc., Sony Ericsson Mobile Communications AB, LG Electronics and Kyocera Corporation, original design manufacturers such as HTC Corporation, Chi Mei Communication Systems, Inc. and Compal Electronics, Inc., and MVNOs such as Helio, Inc. In addition, consumers use or may use products and services from Internet companies, such as Google Inc., or Google, that may compete with Danger-enabled mobile devices and our mobile data services. We also compete broadly with a significant number of firms that market single elements of our solution, including mobile platform companies such as Motricity, Inc. and wireless messaging solutions companies such as Good Technology Inc. (owned by Motorola), Openwave Systems Inc., Seven Networks, Inc. and Visto Corporation.

Some of our competitors’ and our potential competitors’ advantages over us, either globally or in particular geographic markets, include the following:

• significantly greater revenues and financial resources;

• stronger brand and consumer recognition regionally or worldwide;

• the capacity to leverage their marketing expenditures across a broader portfolio of mobile and non-mobile products;

• access to core technology and intellectual property, including more extensive patent portfolios;

• quicker pace of innovation;

• stronger mobile operator relationships;

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• greater resources to make acquisitions;

• lower labor and development costs; and

• broader global distribution and presence.

If we are unable to compete effectively or we are not as successful as our competitors in our target markets, our sales would decline, our margins would decline and we would lose market share, any of which would materially harm our business, operating results and financial condition.

New entrants and recent developments in the mobile device and mobile services markets may harm our competitive position.

The markets for development, distribution and sale of mobile devices and mobile data services are rapidly evolving. New entrants seeking to gain market share by introducing new technology and new products may make it more difficult for us to sell our mobile data services solution, and could result in increased pricing pressure, reduced profit margins, increased sales and marketing expenses or the loss of market share or expected market share, any of which may significantly harm our business, operating results and financial condition.

For example, Google recently announced the formation of the Open Handset Alliance, a consortium of mobile operators, mobile handset manufacturers and software and mobile computing companies focused on developing an open source software platform for mobile devices. Google’s announcement indicated that more than thirty companies had joined the Open Handset Alliance and that mobile devices based on the open source software platform developed by the Open Handset Alliance would be available in the second half of 2008. T-Mobile USA, our largest customer, and Motorola, one of our two OEM partners, are both founding members of the Open Handset Alliance and have each publicly expressed an intention to leverage the software platform developed by the Open Handset Alliance. If the Open Handset Alliance’s software platform is widely adopted, we may not be able to attract new OEM partners to manufacture mobile devices based on our mobile data services platform, our existing OEM partners may cease developing mobile devices that operate our mobile data services platform, and mobile operator customers, including T-Mobile USA, may not purchase Danger-enabled mobile devices or our mobile data services solution. These developments would significantly harm our business, operating results and financial condition.

In addition, many mobile operators have also started to develop, internally or through managed third parties, their own mobile devices and mobile data services for distribution. Verizon Wireless also recently announced that it will open its network to wireless devices, software and applications that are not sold by Verizon Wireless in an effort to expand its customer base. As mobile operators invest in their own mobile devices and mobile data services and, like Verizon Wireless, choose to open their networks to a variety of devices, applications and services, they might refuse to distribute Danger-enabled mobile devices or some or all of our mobile data services. In addition, to the extent that we license our technology to enable additional device manufacturers to equip their mobile devices with our mobile data services platform, such action may impact demand for Danger-enabled mobile devices sold with our current OEM partners and mobile operator customers.

Our success is strongly tied to the popularity of our mobile data services platform and Danger-enabled mobile devices with subscribers and is subject to risks associated with unpredictable and continuously changing consumer tastes. If we fail to develop new mobile data services or our OEM partners fail to develop mobile devices that achieve market acceptance by consumers, sales of our mobile data services and our revenues would decline.

Our business depends on developing mobile data services and supporting the launch of Danger-enabled mobile devices manufactured by our OEM partners that mobile operators sell to subscribers. We must invest significant resources in research and development, engineering and software development to enhance our mobile data services platform and introduce new data services, and we must bring them to market in a timely manner.

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Even if our mobile data services and Danger-enabled mobile devices are successfully introduced and initially adopted, a subsequent shift in the requirements of our mobile operator customers, market dynamics or the preferences of consumers could cause a decline in the popularity of Danger-enabled mobile devices or our mobile data services. For example, to date, our mobile operator customers have marketed Danger-enabled mobile devices primarily to young adults, teenagers and socially-oriented consumers. We believe that the current popularity of social networking and instant messaging has contributed to sales of Danger-enabled mobile devices among this demographic. The tastes of these consumers are unpredictable and subject to rapid change, based in part on changing trends within the popular culture. In addition, these consumers are strongly influenced by the pricing structure and branding success of our mobile operator customers, over which we have no control. As the tastes and preferences of consumers change, we cannot assure you that our Danger-enabled mobile devices will continue to be popular with these consumers or whether our mobile operator customers will be able to structure product offerings that successfully market to them or other demographic groups. Competitors may also offer new mobile devices and services that have greater appeal to our core consumer demographic. If we and our mobile operator customers are not able to successfully market Danger-enabled mobile devices and our mobile data services to these and other consumers, our revenues would decline and our business, operating results and financial condition would be harmed.

Our success depends on significantly increasing the number of subscribers that use Danger-enabled mobile devices to access our mobile data services.

Our revenues are derived primarily from payments that we receive from our mobile operator customers for each subscriber that uses a Danger-enabled mobile device to access our mobile data services and, to a lesser extent, from revenue share arrangements associated with purchases of premium applications, content and services by subscribers. To date, only a relatively small number of consumers use Danger-enabled mobile devices compared to the total number of mobile device users. Our near-term operating and financial results depend heavily on achieving significant use by consumers of Danger-enabled mobile devices. Our operating and financial results also depend on achieving widespread deployment of our mobile data services by attracting and retaining additional mobile operator customers. The use of our mobile data services platform will depend on the quality of those services and subscriber expectations for those services, which may vary by market, as well as the level of subscriber turnover experienced by our mobile operator customers. If subscriber turnover increases more than we anticipate, our financial results could be adversely affected. For example, during the three month period ended September 30, 2007, subscriber turnover increased as compared to the prior three-month period, which we believe was due to the commercial introduction of Apple Inc.’s iPhone in June 2007.

If our current and future mobile operator customers are not able to successfully market Danger-enabled mobile devices and our mobile data services, if we are not successful in maintaining and expanding relationships with mobile operator customers, or if we are not able offer a compelling mobile data and Internet solution for consumers, we will not be able to increase the number of consumers that use our mobile data services, and our business prospects, operating results and financial condition will be materially adversely affected.

There is a limited number of mobile operator customers for our mobile data services solution.

Our success is highly dependent upon establishing and maintaining successful relationships with mobile operator customers. There is a limited number of mobile operator customers that may use our mobile data services solution on their networks due to a number of factors, including:

• operator concentration within the wireless services industry;

• incompatibility between our mobile data services platform and certain mobile operator networks;

• contractual limitations in our agreements or the agreements of our OEM partners; and

• unfavorable market conditions in certain geographies.

Many of our mobile operator customer agreements provide the mobile operator customer with rights of first refusal or exclusive rights to sell our mobile data services in a particular territory. For example, pursuant to our

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agreement with T-Mobile USA, T-Mobile USA has certain exclusivity rights and rights of first refusal for new mobile data services and mobile device designs owned or controlled by us. The exclusivity and first refusal rights in our agreements with our mobile operator customers may inhibit our ability to establish relationships with other mobile operator customers, and therefore may limit our growth in particular territories. In addition, our OEM partners’ agreements with our mobile operator customers may prevent our OEM partners from selling Danger-enabled mobile devices to other mobile operators, and, consequently, would limit us from establishing new relationships with mobile operator customers.

Our mobile data services platform is not currently compatible with the networks of certain mobile operators and may not support future network technologies implemented by mobile operators. For example, our technology does not currently support devices that are based on code division multiple access, or CDMA, technology which represents a significant portion of the total mobile device market in the United States and certain Asian countries, and we have no current plans to support such devices. Our inability to develop or deliver a mobile data services platform that supports the technologies of multiple mobile operators will limit the number of mobile operator customers that may employ our solution. In addition, we are limited as to which subscriber markets we can access through mobile operators as a result of inadequate infrastructure within certain territories, the existence of entrenched or localized mobile operators with which we have no relationship, and differences in consumer trends and public tastes in certain geographies. For example, in Europe, we believe that the popularity of text messaging among mobile device consumers has inhibited the adoption of other mobile data messaging services, such as instant messaging, which are widely used by subscribers of our mobile data services in the United States. If we are not able to establish or maintain relationships with mobile operators or obtain access to additional subscribers, our operating results and financial condition will be adversely impacted.

We are substantially dependent on our mobile operator customers to market and distribute Danger-enabled mobile devices and our mobile data services to subscribers and to generate our revenues.

We rely on our mobile operator customers for substantially all of the marketing of Danger-enabled mobile devices and our mobile data services to subscribers. None of our mobile operator customers are contractually obligated to introduce, market or promote mobile devices that run on our mobile data services platform. Moreover, our mobile operator customer agreements do not prevent our mobile operator customers from offering mobile data services supported by internally-developed technologies or technologies developed by one or more of our competitors. If mobile operator customers do not introduce, market and promote Danger-enabled mobile devices, our mobile data services solution will not achieve widespread acceptance and we may not be able to grow as fast as anticipated, or at all. In addition, our mobile operator customers are responsible for the structure and pricing of mobile data service plans that they offer, as well as marketing strategies and customer service programs. Any modifications to these pricing structures could affect the demand for Danger-enabled mobile devices by consumers.

Our success depends on a number of factors controlled by our mobile operator customers.

In addition to the marketing and promotion of our mobile data services by our mobile operator customers, our success depends on a number of factors that are largely controlled by our mobile operator customers, including:

• the addition and retention by our mobile operator customers of subscribers to our mobile data services;

• changes in the terms that our mobile operator customers may offer to subscribers for our mobile data services;

• the achievement of branding success by our mobile operator customers and related consumer familiarity with Danger-enabled mobile devices;

• the availability and quality of the wireless networks of our mobile operator customers, which we do not maintain;

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• the extent and timeliness of testing of our mobile data services on the wireless networks of our mobile operator customers;

• continued investments by our mobile operator customers in evolving network technologies, such as third-generation, or 3G, high bandwidth wireless network capability, and our ability to maintain compatibility with such evolving technology; and

• consolidation involving our mobile operator customers.

Any or all of these factors could negatively impact our business, which could have a material adverse effect on our financial condition and results of operations.

If our mobile operator customers, particularly T-Mobile USA, change their branding strategies, our potential revenues could be limited and our business, operating results and financial condition could be harmed.

Danger-enabled mobile devices are most popularly recognized and sold in the United States and certain other geographies under the T-Mobile Sidekick brand. Deutsche Telekom, AG, the parent company of the group of T-Mobile mobile operators, owns the trademark “Sidekick” in the United States and in international territories, and T-Mobile mobile operators have spent a significant amount of money during the last several years promoting and marketing Danger-enabled mobile devices and our mobile data services under the Sidekick brand in the United States and internationally. As such, the marketplace and consumers popularly know Danger-enabled mobile devices and our mobile data services by the Sidekick trademark. Although the T-Mobile mobile operators have not marketed a competitor’s device or mobile data services under the Sidekick brand, we cannot guarantee how T-Mobile mobile operators will use the Sidekick trademark in the future. If T-Mobile mobile operators do not market future Danger-enabled mobile devices under the Sidekick brand or begin marketing competitors’ products under the Sidekick brand, our business, operating results and financial condition could be harmed.

We rely on network infrastructures provided by our mobile operator customers for the delivery of our mobile data services to consumers.

Our future success will depend on the availability and quality of our mobile operator customers’ wireless networks in the United States and internationally to run our mobile data services and to provide us access to their subscribers. This includes deployment and maintenance of reliable 3G networks with the speed, data capacity and security necessary to provide reliable wireless communications services. We do not establish or maintain these wireless networks and have no control over interruptions or failures in the deployment and maintenance by mobile operators of their wireless network infrastructure. In addition, these wireless network infrastructures may be unable to support the demands placed on them if the number of subscribers continues to increase, or if existing or future subscribers increase their bandwidth requirements. Market acceptance of our mobile data services platform will depend in part on the quality of these wireless networks and the ability of our mobile operator customers to effectively manage their subscribers’ expectations. Wireless communications have experienced a variety of outages and other delays as a result of infrastructure and equipment failures, and could face outages and delays in the future. These outages and delays could reduce the level of wireless communications usage as well as our ability to provide our mobile data services successfully. In addition, changes by a mobile operator to network infrastructure may interfere with the delivery of our mobile data services and may cause subscribers to lose functionality in Danger-enabled mobile devices that they have already purchased. Any of this could harm our business, operating results and financial condition.

The failure of our OEM partners to keep pace with technological and market developments in mobile device design may negatively affect the demand for Danger-enabled mobile devices and our mobile data services.

Our future success will depend on our OEM partners’ ability to manufacture Danger-enabled mobile devices that meet the technological and design demands of mobile operator customers and their subscribers. Our OEM

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partners will have to invest in developing mobile devices that are compatible with the advanced network technology, such as 3G technology, that mobile network operators are deploying to increase network capacity and speed for mobile data delivery. For example, we are currently planning to work with Sharp and Motorola to develop Danger-enabled mobile devices that are compatible with 3G technologies from Qualcomm Corporation. If our current or future OEM partners fail to adopt 3G technology or other advanced technologies, future sales of Danger-enabled mobile devices may suffer. In addition, if our OEM partners adopt 3G technology that is incompatible with our mobile data services platform development, there will be fewer Danger-enabled mobile devices available to consumers and sales of our mobile data services will suffer.

Successful sales of Danger-enabled mobile devices also depend on our OEM partners keeping pace with changing consumer preferences for mobile devices. If our OEM partners do not develop Danger-enabled mobile devices with the design attributes attractive to consumers, such as thin form factors, high-resolution screens and attractive plastics and colors, sales of Danger-enabled mobile devices may decline and, consequently, our business will be harmed.

We have experienced, and may in the future experience, delays or interruptions in the manufacturing and delivery of Danger-enabled mobile devices by our OEM partners, that may harm our business.

Our OEM partners’ ability to timely manufacture and ship Danger-enabled mobile devices in large quantities and at competitive prices depends on a variety of factors. Our OEM partners may experience design or development delays due to hardware or software defects, problems with their contract manufacturers, difficulties in obtaining required industry or regulatory certifications, or difficulties in passing mobile operator handset qualification tests. Any such delays would adversely impact the timing of Danger-enabled mobile device launches and would consequently negatively impact our future revenues. For example, in November 2007, following the initial launch of the Sidekick Slide, T-Mobile suspended sales and removed devices from retail store shelves due to reports that some devices were irregularly powering off. After diagnosing the problem, our OEM partner’s contract manufacturer implemented a fix at the factory and our OEM partner repaired the defective units that had already shipped. The defect resulted in approximately a three week delay in sales of Sidekick Slide devices. In addition, our OEM partners rely on a limited number of sources for the timely supply of functional components, such as displays, semiconductors, batteries, printed circuit boards, plastics, tooling equipment and flash memory. Functional component supply shortages or delays could prevent or delay the manufacture and shipment of Danger-enabled mobile devices by our OEM partners. For example, in 2005, a fire at a component supplier’s factory limited the supply of camera modules for Sharp’s Danger-enabled mobile devices, resulting in an inventory shortage and production and shipment delays until an alternative source was located. Cost increases in such components could also result in our OEM partners refusing to commercially offer or continue to support Danger-enabled mobile devices. In addition, contractual restrictions or claims for infringement of intellectual property rights may restrict our OEM partners’ use of certain components. These restrictions or claims may require our OEM partners to utilize alternative components or obtain additional licenses or technologies, and may impede our OEM partners’ ability to manufacture and deliver Danger-enabled mobile devices on a timely or cost-effective basis. Any of these occurrences could ultimately have a material adverse effect on our business, operating results and financial condition.

Changes to the economics of our relationships with our OEM partners could have a material adverse impact on our business, operating results and financial condition.

We license our client software to our OEM partners on a royalty-free basis. However, our client software includes certain technology or intellectual property that we license from third parties for which royalties are due on the sale of Danger-enabled mobile devices. Such third parties include, but are not limited to:

• Sun Microsystems, Inc., for the use of its Java specifications;

• owners of intellectual property related to the global system for mobile communication, or GSM standard, and other wireless standards, such as Nokia Corporation, Telefonaktiebolaget LM Ericsson and Interdigital, Inc.;

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• owners of intellectual property relating to digital image compression and transmission, such as Eastman Kodak Company; and

• owners of intellectual property relating to compression and transmission of digital music files, such as Thomson S.A.

We anticipate that the addition of new features and functionality to our mobile data services and Danger-enabled mobile devices will require us to obtain licenses that involve the payment of additional per unit royalties to third parties. Under our agreements with our OEM partners, our OEM partners agree to either reimburse us for any such per unit royalties that we may be required to pay, or agree to pay these royalties directly to the rights holders. If, in the future, our OEM partners do not agree to pay these third party royalties or do not agree to reimburse us for our royalty payments, we would incur increased expenses, which would have a material adverse impact on our business, operating results and financial condition. In addition to these technologies for which we obtain licenses, if third parties claim that we, our OEM partners or our mobile operator customers infringe upon their intellectual property rights, we may be required to make significant payments or obtain additional licenses, which may not be available on terms acceptable to us, or at all.

If our third-party developers cease development of new premium applications, content and services for us or the mix of premium applications, content and services that we offer to consumers changes, our business may be adversely impacted.

We rely on third-party developers to develop a majority of the games, ringtones and other premium applications, content and services that our mobile operator customers sell to subscribers that access our mobile data services. During the fiscal years ended September 30, 2006 and 2007, sales of premium applications, content and services represented 7.6% and 8.3% of our service revenues, respectively. Because we rely on third-party developers to develop the majority of the premium applications, content and services that we offer, we are subject to the following risks:

• key developers that worked with us in the past may choose not to work with us in the future;

• third-party developers currently under contract may try to renegotiate our agreements with them on terms less favorable to us;

• larger third-party developers with popular offerings may not do business with us because the subscriber base at our existing mobile operator customers is small relative to other opportunities;

• the content that is produced for us may not be popular with our customers; and

• our third-party developers may be unable or unwilling to allocate sufficient resources to complete premium applications, content and services for our platform in a timely or satisfactory manner, if at all.

If our developers terminate their relationships with us or negotiate agreements with terms less favorable to us, we may have to reduce the number of premium applications, content and services that we intend to introduce, delay the introduction of some premium applications, content and services or increase our internal development staff, which would be a time-consuming and potentially costly process, and, as a result, our business, operating results and financial condition could be harmed.

Some of our mobile operator customers source their own premium applications, content and services and we have lower margins on sales of these mobile operator customers’ premium applications, content and services. Our agreements with certain mobile operator customers also allow the mobile operator customer to control the mix of premium applications, content and services that are offered to subscribers. If the mix of premium applications, content and services sold to subscribers changes and our margins are reduced, our business, operating results and financial condition could be harmed.

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We may not be able to enhance our mobile data services platform to keep pace with technological and market developments, or develop new mobile data services in a timely manner or at competitive prices.

The market for mobile data services is emerging and is characterized by rapid technological change, evolving industry standards, frequent new product introductions and short product life cycles. To keep pace with technological developments, satisfy increasing customer requirements and achieve product acceptance, our future success depends upon our ability to enhance our current mobile data services platform and to continue to develop and introduce new mobile data services offering compatibility, enhanced performance features and functionality on a timely basis at competitive prices. For example, our mobile data services platform does not currently support video services or Wi-Fi interoperability, and our failure to address these or other technological advances may limit our growth and harm our competitive position. In addition, our mobile data services platform is not compatible with the technologies of many mobile operators, such as CDMA networks that are operated by certain mobile operators, such as Sprint Nextel Corporation and Verizon Wireless in the United States, and may not support future technologies developed by mobile operators or OEMs. Our inability, for technological or other reasons, to enhance, develop, introduce or deliver compelling mobile data services in a timely manner, or at all, in response to changing market conditions, technologies or consumer expectations could have a material adverse effect on our operating results or could result in our mobile data services platform becoming obsolete. Our ability to compete successfully will depend in large measure on our ability to maintain a technically skilled development and engineering staff and to adapt to technological changes and advances in the industry, including providing for the continued compatibility of our mobile data services platform with evolving industry standards and protocols and competitive network operating environments.

Development and delivery schedules for mobile data services are difficult to predict. If new releases of our mobile data services are delayed, mobile operators may curtail their efforts to market and promote Danger-enabled mobile devices and subscribers may switch to competing products, any of which would result in a delay or loss of revenues and could seriously harm our business. In addition, there cannot be any assurance that the technologies and related mobile data services that we develop will be brought to market by mobile operators as quickly as anticipated or that they will achieve broad acceptance among mobile operator customers or consumers.

We anticipate that the addition of certain advanced features and functionality to our current mobile data services platform will require us to obtain licenses from third parties that may not be available on commercially favorable terms, or at all.

We may not be able to upgrade our mobile data services platform to support certain advanced features and functionality, such as mobile video services or Wi-Fi, without obtaining technology licenses from third parties. Obtaining these licenses may be costly and may delay the introduction of such features and functionality, and these licenses may not be available on commercially favorable terms, or at all. The inability to offer advanced features or functionality, or a delay in our ability to upgrade our mobile data services platform, may adversely affect consumer demand for our mobile data services and, consequently, harm our business.

Our lengthy sales cycle makes it difficult for us to predict when we will generate revenues from new mobile operator customers.

We have a lengthy and complex sales process. The integration and testing of our mobile data services platform with our prospective mobile operator customers requires a substantial amount of time before launching our mobile data services with that mobile operator customer. Our sales cycles are typically longer and more problematic in new markets. Even after an initial decision to launch our mobile data services is made, the integration of our mobile data services platform with a mobile operator customer’s network and billing systems requires several months before commercial deployment. Because of this lengthy cycle, we may experience delays from the time we begin the sales process and incur increased costs and expenses to obtain a new mobile operator customer and integrate our mobile data services platform until the time we generate revenues from such mobile operator customer. These delays may make it difficult to predict when we will generate revenues from new customers.

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We operate in an industry with extensive intellectual property litigation. Claims of infringement against us, our OEM partners or our mobile operator customers may cause our business, financial condition and operating results to suffer.

Our commercial success depends in part upon us, our OEM partners and our customers not infringing intellectual property rights owned by others and being able to resolve claims of intellectual property infringement without major financial expenditures. We operate in an industry with extensive intellectual property litigation. Many participants that own, or claim to own, intellectual property aggressively assert their rights, and our mobile operator customers and our OEM partners, whom we indemnify for intellectual property infringement claims related to our solution, are often targets of such assertions. We cannot determine with certainty whether any existing or future third-party intellectual property rights would require us to alter our technologies, obtain licenses or cease certain activities.

We have received, and may in the future continue to receive, claims from third parties asserting infringement and other related claims. For instance, in 2005, a patent holding company filed lawsuits alleging patent infringement and trade secret misappropriation against us, T-Mobile USA, Sharp and an affiliate of Sharp. We incurred expense of approximately $2.7 million in defending ourselves, T-Mobile and Sharp before settling the litigation in November 2006. Future litigation may be necessary to defend ourselves, our mobile operator customers and our OEM partners by determining the scope, enforceability and validity of third-party proprietary rights or to establish our proprietary rights. Some of our competitors may have substantially greater resources than we do and may be able to sustain the costs of complex intellectual property litigation to a greater degree and for longer periods of time than we could. In addition, patent holding companies that focus solely on extracting royalties and settlements by enforcing patent rights may target us, our mobile operator customers or our OEM partners. Regardless of whether claims that we are infringing patents or other intellectual property rights have any merit, these claims are time-consuming and costly to evaluate and defend and could:

• adversely affect our relationships with our current or future mobile operator customers, their subscribers or our OEM partners;

• cause delays or stoppages in the shipment of Danger-enabled mobile devices, or cause us to modify or suspend the provision of our mobile data services;

• divert management’s attention and resources;

• subject us to significant liabilities;

• require us to enter into royalty or licensing agreements on unfavorable terms; and

• require us to cease certain activities.

In addition to liability for monetary damages against us or, in certain circumstances, our OEM partners and mobile operator customers, we may be prohibited from developing, commercializing or continuing to provide certain of our mobile data services unless we obtain licenses from the holders of the patents or other intellectual property rights. We cannot assure you that we will be able to obtain any such licenses on commercially favorable terms, or at all. If we do not obtain such licenses, our business, operating results and financial condition could be materially adversely affected and we could, for example, be required to cease offering or materially alter our mobile data services in some markets.

In addition, our OEM partners and mobile operator customers may be subject to claims from third parties asserting that they are infringing patents or other intellectual property rights of these third parties. These claims may require our OEM partners or mobile operator customers to utilize alternative components, obtain additional licenses or cease the use of certain technologies, which can be time-consuming and expensive. For example, the U.S. International Trade Commission recently ruled that Qualcomm infringed Broadcom Corporation’s patent rights and issued an import ban on certain mobile devices containing Qualcomm’s technology. Broadcom also initiated two suits against Qualcomm alleging, among other things, patent infringement and antitrust violations.

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We are planning to work with our OEM partners to develop future Danger-enabled mobile devices that utilize chipsets sold by Qualcomm. If the import ban is not stayed or lifted, if these suits are resolved unfavorably for Qualcomm or if our OEM partners are otherwise unable to utilize chips sold by Qualcomm, the manufacture and delivery of Danger-enabled mobile devices by our OEM partners may be delayed or discontinued, and our business may be harmed.

Indemnity provisions in various agreements potentially expose us to substantial liability for intellectual property infringement, damages caused by defective software and other losses.

Our agreements with our mobile operator customers and OEM partners include indemnification provisions. In these provisions, we agree to indemnify them for losses suffered or incurred in connection with our client software and mobile data services, including as a result of intellectual property infringement, damages caused by defects and damages caused by viruses, worms and other malicious software. The term of these indemnity provisions is generally perpetual after execution of the corresponding agreement, and the maximum potential amount of future payments we could be required to make under these indemnification provisions is generally unlimited.

We have received, and expect to continue to receive, demands for indemnification under these agreements, which demands can be very expensive to settle or defend, and we have in the past contributed to settlement amounts and incurred substantial legal fees in connection with certain of these indemnity demands. A number of these indemnity demands, including demands from T-Mobile USA and Sharp, relate to pending litigation and remain outstanding and unresolved as of the date of this prospectus. For example, in October 2007, T-Mobile USA demanded that we indemnify and defend T-Mobile USA against a lawsuit brought by NTP, Inc., or NTP, alleging that T-Mobile USA is infringing certain patents held by NTP relating to the use of wireless communications in electronic mail systems and seeking unspecified damages. NTP is a patent holding company that sued Research in Motion Limited, which markets BlackBerry wireless devices, for patent infringement in 2001, and settled such litigation with Research in Motion Limited in 2006 for $612.5 million. Although NTP’s lawsuit against T-Mobile USA was recently stayed pending the U.S. Patent and Trademark Office’s ongoing review of NTP’s patents, the stay could be lifted at any time. As of the date of this prospectus, we have not accepted or rejected T-Mobile USA’s indemnity demand related to this litigation. Large future indemnity payments and associated legal fees and expenses, including potential indemnity payments and legal fees and expenses relating to T-Mobile USA’s indemnity demand with respect to the NTP lawsuit, could materially harm our business, operating results and financial condition.

Although we have not agreed to defend or indemnify our mobile operator customers or OEM partners for any outstanding and unresolved indemnity demands, we may in the future agree to defend and indemnify them in connection with these demands, irrespective of whether we believe that we have an obligation to indemnify them or whether we believe that our solution infringes the asserted intellectual property rights. Alternatively, we may reject certain of our mobile operator customers’ or OEM partners’ indemnity demands, including outstanding demands from T-Mobile USA or Sharp, which rejections may lead to disputes with our mobile operator customers or OEM partners and may negatively impact our relationships with them or result in litigation against us. Our mobile operator customers or OEM partners may also claim that any rejection of their indemnity demands constitutes a material breach of our agreements with them, allowing them to terminate such agreements. If, as a result of indemnity demands, we make substantial payments, our relationships with our mobile operator customers or OEM partners is negatively impacted, or if any of our mobile operator customer or OEM partner agreements is terminated, our business, financial condition and operational results could be materially adversely affected.

If we are unable to protect our intellectual property and proprietary rights, our competitive position and our business could be harmed.

We rely primarily on a combination of patent laws, trademark laws, copyright laws, trade secrets, confidentiality procedures and contractual provisions to protect our proprietary technology. As of September 30,

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2007, we held 34 U.S. patents and eight foreign patents expiring between August 16, 2021 and April 20, 2024, and have 40 U.S. and 47 pending foreign patent applications. We also have filed corresponding foreign applications pursuant to the Patent Cooperation Treaty for many of our patents and patent applications. However, our issued patents and any future patents that may issue may not survive a legal challenge to their scope, validity or enforceability, or provide significant protection for us. The failure of our patents to adequately protect our technology might make it easier for our competitors to offer similar products or technologies. In addition, patents may not issue from any of our current or any future applications.

Monitoring unauthorized use of our intellectual property is difficult and costly. The steps we have taken to protect our proprietary rights may not be adequate to prevent misappropriation of our intellectual property. Further, we may not be able to detect unauthorized use of, or take appropriate steps to enforce, our intellectual property rights. Our competitors may also independently develop similar technology. In addition, the laws of many countries do not protect our proprietary rights to as great an extent as do the laws of the United States. Any failure by us to meaningfully protect our intellectual property could result in competitors offering products that incorporate our most technologically advanced features, which could seriously reduce demand for Danger-enabled mobile devices and our mobile data services. In addition, we may in the future need to initiate infringement claims or litigation. Litigation, whether we are a plaintiff or a defendant, can be expensive, time-consuming and may divert the efforts of our technical staff and managerial personnel, which could harm our business, whether or not such litigation results in a determination favorable to us.

Our financial results could vary significantly from quarter to quarter and are difficult to predict.

Our revenues and operating results could vary significantly from quarter to quarter because of a variety of factors, many of which are outside of our control. As a result, comparing our operating results on a period-to-period basis may not be meaningful. In addition, we may not be able to predict our future revenues or results of operations. In the event that we enter into an agreement, or amend an existing agreement, with a particular mobile operator customer that requires us to provide specified deliverables, the generally accepted accounting principles governing our recognition of revenue and expenses may require us to defer all revenues and certain direct and incremental expenses related to that particular mobile operator customer until such specified deliverable is provided. This could result in a deferral of a substantial portion of our revenues in future periods as well as significant variations in our results from quarter to quarter, and therefore makes it very difficult for us to adequately forecast our revenues and expenses in future periods. In addition, revenues and expenses related to our premium applications, content and services and non-recurring engineering fees are required to be amortized over the longer of the applicable mobile operator contract or the expected period of performance under the applicable mobile operator contract. As a result, our amortization of these revenues, and, consequently, our margins, may change materially from quarter to quarter, particularly in connection with any extension to an applicable mobile operator customer contract. Any significant variations in our results of operations as a result of these accounting policies could adversely impact the price of our common stock.

We base our current and future expense levels on our internal operating plans and sales forecasts, and our operating costs are to a large extent fixed. As a result, we may not be able to reduce our costs sufficiently to compensate for an unexpected shortfall in revenues, and even a small shortfall in revenues could disproportionately and adversely affect our financial results for a particular quarter. Our relationship with T-Mobile USA represents a substantial majority of our revenues and will influence our net income or loss in any quarter, as will our relationships with other mobile operator customers. We may also incur significant or unanticipated expenses if we need to acquire licenses to third party technology and/or develop new mobile data services based on new and emerging technologies. For instance, we recently licensed technology from Qualcomm Corporation at a significant cost for the development of our mobile data services platform to support higher speed, 3G mobile devices. These engineering development efforts may take longer than anticipated, which could delay or prevent the commercial introduction of new or enhanced Danger-enabled mobile devices or mobile data services, which would have an adverse impact on our business and operating results.

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In addition to other risk factors discussed above, factors that may contribute to the limited visibility and variability of our quarterly results include:

• the number of and timing of release of new Danger-enabled mobile devices developed by our OEM partners;

• the number of and timing of release of new mobile devices developed by our competitors or competitors of our OEM partners;

• uncertain and limited visibility into the volume of Danger-enabled mobile device orders by our mobile operator customers;

• our lengthy and complex sales process;

• the efforts of our mobile operator customers in marketing Danger-enabled mobile devices, including service plans and promotions, sales channels supported, sales compensation, device subsidies, device positioning and direct marketing programs;

• the rate of subscriber turnover from Danger-enabled mobile devices to competitive products;

• the renegotiation or expiration of existing mobile operator customer agreements;

• the impact of outages of our mobile data services, or of our mobile operator customers’ network services;

• changes in pricing policies by us, our competitors or our mobile operator customers;

• changes in the mix of premium applications, content and services that we provide or our mobile operator customers provide, which have varying gross margins;

• fluctuations in the size and rate of growth of overall consumer demand for mobile devices and related content;

• our success in entering new geographic markets;

• future changes in accounting rules governing recognition of revenue;

• the seasonality of our industry; and

• general economic and political conditions in the countries where we operate or Danger-enabled mobile devices are used.

As a result of these and other factors, our operating results may vary and not meet expectations. If we fail to meet market expectations, the trading price of our common stock would decrease.

We may be required to reduce our prices to compete successfully, or we may incur increased or unexpected costs, which could have a material adverse effect on our operating results and financial condition.

The intensely competitive market in which we conduct our business may require us to reduce our prices, which could negatively impact our operating results. For example, competition could result in price reductions due to competing solutions that are provided at little or no cost as part of a bundled offering or competitors offering deep discounts on mobile data services in an effort to recapture or gain market share or to sell other mobile data services. In addition, rates charged by our mobile operator customers for mobile data services could decline significantly, resulting in pricing pressures that negatively impact our operating results. Moreover, we may experience cost increases or unexpected costs which may also negatively impact our operating results, including increased or unexpected costs related to:

• the implementation of new data centers and expansion of existing data centers, as well as increased data center rent, hosting and bandwidth costs;

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• the replacement of aging equipment;

• acquiring key technologies to support or expand our mobile data services solution;

• changes in the mix of premium applications, content and services that we provide or our mobile operator customers provide, which have varying gross margins; and

• increases in our software warranty costs and indemnification obligations associated with our mobile operator customer and OEM partner agreements.

Network failures, disruptions or capacity constraints in our third-party data center facilities or in our hosted service delivery engine, or SDE, could affect the performance of our mobile data services platform and harm our reputation and our revenues.

Our mobile data services are provided through a combination of our hosted SDE and the wireless networks of our mobile operator customers. Our operations rely to a significant degree on the efficient and uninterrupted operation of our hosted SDE. Our hosted SDE is currently located in third-party data center facilities located in San Jose, California and is now operated by Verizon Business Network Services, Inc., or Verizon, following its acquisition of MCI Communications Services. In October 2007, we entered into an agreement with Digital Realty Trust, or DRT, for additional hosted data center facilities located in Phoenix, Arizona to accommodate the anticipated growth of our mobile data services. Unlike our Verizon facilities, our hosting facilities with DRT are not full service hosting facilities. Therefore, we must separately contract for and manage the supply of internet connectivity, power, equipment installation and on site support for the DRT facilities and we have not previously been responsible for managing these services. We are planning to complete the set up of our DRT facilities to support their commercial operation of our SDE by June 1, 2008. Depending on the rate of growth of our mobile data services, if our DRT facilities are not timely completed and operational, we may experience SDE capacity issues, which could lead to network failures and disruptions.

Our hosted SDE and data center facilities are potentially vulnerable to damage or interruption from a variety of sources including by fire, flood, earthquake, power loss, telecommunications or computer systems failure, human error, terrorist acts or other events. In addition, under the terms of our service agreement with Verizon, Verizon may cease providing service to us if Verizon determines that its personnel or facilities are at risk of harm or damage. We have not yet completed a business continuity plan and there can be no assurance that the measures implemented by us to date, or measures implemented by us in the future, to manage risks related to network failures or disruptions in our SDE or data center facilities will be adequate, or that the redundancies built into our SDE will work as planned in the event of network failures or other disruptions. In particular, if we experience damage or interruptions to our data center facilities in San Jose, California, or were unable to build out and commence operations in our new data center facilities in Phoenix, Arizona, our ability to provide efficient and uninterrupted operation of our SDE would be significantly impaired.

We could also experience failures or interruptions of our SDE, or other problems in connection with our operations, as a result of:

• damage to or failure of our computer software or hardware or our connections and outsourced service arrangements with third parties;

• errors in the processing of data by our SDE;

• computer viruses or software defects;

• physical or electronic break-ins, sabotage, intentional acts of vandalism and similar events; or

• errors by our employees or third-party service providers.

Poor performance in or disruptions of our mobile data services platform could harm our reputation, delay market acceptance of our services and subject us to liabilities. We enter into service level agreements with our

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customers that specify the events constituting “down time” and the actions that we will take to rectify or respond to such down time, including in certain cases, the payment of financial penalties. For instance, in March 2005, we experienced a multiple day service outage for which we were required to provide significant financial credits to our mobile operator customers under the terms of our service level agreements. Failure to comply with service level agreements in the future may have a material adverse effect on our business, operating results and financial condition.

In addition, if our consumer base grows, additional strain will be placed on our technology systems and networks, which may increase the risk of a network disruption. Any outage in a network or system, or other unanticipated problem that leads to an interruption or disruption of our mobile data services could have a material adverse effect on our operations, sales and operating results.

If our mobile data services platform does not scale as anticipated, or we are unable to grow data center capacity as needed, our business will be harmed.

Despite frequent testing of the scalability of our mobile data services platform in a test environment, the ability of our mobile data services platform to scale to support a substantial increase in the number of users in an actual commercial environment is unproven. If our mobile data services platform does not efficiently and effectively scale to support and manage a substantial increase in the number of users while maintaining a high level of performance, our business will be seriously harmed. In addition if we are unable to secure data center space with appropriate power, cooling and bandwidth capacity, we may not be able to efficiently and effectively scale our business to manage the addition of new mobile operator customers, increases in subscriber growth or increases in data traffic.

If the use of our mobile data services solution results in more mobile data traffic than anticipated, our mobile operator customers may change the pricing and other terms by which they offer our mobile data services, which could result in increased subscriber turnover and damage to our business.

T-Mobile USA and other of our mobile operator customers sell Danger-enabled mobile devices with an unlimited data service plan. Offering unlimited data service plans is profitable for our mobile operator customers as long as average subscriber data usage remains below expected levels. If average subscriber usage of our mobile data services exceeds the levels anticipated by our mobile operator customers, or if we begin to offer new mobile data services, such as video streaming services, that cause average subscriber data usage to increase, our mobile operator customers may decide to raise prices, impose usage caps or discontinue unlimited data service plans. If imposed, these pricing changes or usage restrictions could make our mobile data services solution less attractive to consumers and could result in current subscribers abandoning our mobile data services for other products and services. If subscriber turnover increases, the number of consumers using Danger-enabled mobile devices and our revenues would decrease, and our business would be harmed.

Defects in our mobile data services can be difficult to detect. If defects occur, they could have a material adverse effect on our business.

Our mobile data services are highly complex and may contain design defects that are difficult to detect and correct. In the past, we have experienced delays in new releases of Danger-enabled mobile devices and of our mobile data services due to defects, and we may experience similar delays in the future. In addition, we license software and services from third parties that we incorporate into our mobile data services platform, and we cannot control the business and quality standards of these third parties. Despite testing by us, defects and errors may still be found in our current mobile data services platform or in new mobile data service releases, potentially resulting in delayed or lost revenues, loss of customers due to poor user experience, failure to achieve market acceptance, diversion of development resources and harm to our reputation or brand.

The support of our mobile data services entails the risk of product liability or warranty claims based on mobile device returns and repairs due to defects in our client software or mobile data services. In addition, the

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failure of our mobile data services to perform to customer expectations could give rise to service level agreement claims and credits towards fees owed to us. The consequences of such defects, failures and claims could have a material adverse effect on our business.

Products and services that incorporate our mobile data services platform may contain errors or defects, or may be of low quality and break, which could have an adverse effect on our business.

We cannot control the business and quality standards of our mobile operator customers, OEM partners and other technology partners, and we are unable to control the distribution of mobile devices that run our mobile data services. We cannot guarantee that the products and services provided by our OEM partners or mobile operator customers are free from errors or defects. If errors or defects occur in products and services that use our mobile data services platform, it could result in the rejection of these products and services by mobile operators or consumers, damage to our reputation, increased customer service and support costs, warranty claims, lost revenues and diverted development resources, any of which could adversely affect our business and results of operations. For example, in November 2007, T-Mobile USA suspended sales of the Sidekick Slide device and removed devices from retail store shelves due to reports that some Sidekick Slide devices were irregularly powering off. Following an approximately three week delay, the issues were remedied and sales of Sidekick Slide devices resumed. Also, in 2003, our contract manufacturer’s improper assembly process led to a high rate of device screen failures and nearly caused an interruption in the supply of Danger-enabled mobile devices. We were required to implement manufacturing process changes and repair returned devices to remedy the defect without a supply interruption. In addition, where consumers perceive that our mobile operator customers do not have adequate network coverage, sales of Danger-enabled mobile devices may decrease or consumers that purchase our mobile data services may attribute network coverage issues to our mobile data services.

Software and components that we incorporate into our mobile data services may contain errors or defects, which could have an adverse effect on our business.

We cannot control the quality standards of our suppliers of components that we incorporate into our mobile data services. Although we test certain software before incorporating it into our mobile data services, we cannot guarantee that all of the third-party technology that we incorporate will not contain errors, defects or bugs. If errors or defects occur in products and services that we utilize in our mobile data services platform, it could result in the rejection of these products and services by our OEM partners, our mobile operator customers or their subscribers, damage to our reputation, increased customer service and support costs, warranty claims, lost revenues and diverted development resources. For example, complicated wireless transmission radio software, or radio firmware, from third parties is included in Danger-enabled mobile devices. In the past, we have encountered radio firmware defects that have affected the user experience for our mobile data services. In one case, the radio firmware defect caused the software on Danger-enabled mobile devices to freeze and become unusable. To date, our radio firmware vendor has been able to fix these defects or we have been able to modify our client software to reduce the negative effect caused by these defects. However, we cannot guarantee that we will be successful in remedying any future radio firmware defects. In addition, if a component supplier fails to meet one of our product quality standards, the development of our mobile data services may be delayed. Any of these occurrences could adversely affect our business and results of operations.

The occurrence or perception of a security breach or an inappropriate disclosure of confidential information could seriously harm our business.

Our mobile data services include the transmission and storage of personal, private and confidential information. If there is a security breach or if there is an inappropriate disclosure of any of these types of information, we could be exposed to litigation and possible liability. Even if we were not held liable for such event, a security breach or inappropriate disclosure of personal, private or confidential information could harm our reputation and our relationships with current and potential customers. Even the perception of a security risk could inhibit market acceptance of Danger-enabled mobile devices and our mobile data services. For example, in

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February 2005, the personal information contained on Paris Hilton’s Sidekick device was disclosed on the Internet. Although investigations into the incident concluded that our mobile data services solution was not at fault, the incident may have raised concerns regarding the security of our mobile data services solution. In addition, we may be required to invest additional resources to protect against damages caused by any actual or perceived disruptions of our mobile data services solution or security breaches. Any of these developments could seriously harm our business.

We may need to raise additional capital to grow our business, and we may not be able to raise capital on terms acceptable to us or at all.

The operation of our business and our efforts to grow our business further will require significant cash outlays and commitments. We believe that our existing working capital and borrowings available under our loan agreement with Silicon Valley Bank will be sufficient to fund our working capital requirements, capital expenditures and operations for at least the next 12 months. We have based this estimate on assumptions that may prove to be wrong, and it is possible that we could utilize our available financial resources sooner than we currently expect. The timing and amount of our cash needs may vary significantly depending on numerous factors, including but not limited to:

• market acceptance of our mobile data services;

• the need to adapt to changing technologies and technical requirements; and

• the existence of opportunities for expansion.

If our existing working capital, borrowings available under our loan agreement with Silicon Valley Bank and the net proceeds from this offering are not sufficient to meet our cash requirements, we will need to seek additional capital, potentially through debt or equity financings, to fund our growth. We may not be able to raise needed cash on terms acceptable to us or at all. Financings, if available, may be on terms that are dilutive or potentially dilutive to our stockholders, and the prices at which new investors would be willing to purchase our securities may be lower than our current common stock price. The holders of new securities may also receive rights, preferences or privileges that are senior to those of existing holders of our common stock. If new sources of financing are required but are insufficient or unavailable, we would be required to modify our growth and operating plans to the extent of available funding, which could harm our ability to grow our business.

Failure to adequately manage our growth may seriously harm our business.

We operate in an emerging market and have experienced, and may continue to experience, significant growth in our business. Our growth has placed, and is expected to continue to place, a significant strain on our managerial, administrative, operational and financial resources and our infrastructure. Our future success will depend, in part, upon the ability of our senior management to manage growth effectively. This will require us to, among other things:

• implement additional management information systems;

• further develop our operating, administrative, financial and accounting systems and controls;

• hire additional personnel;

• develop additional levels of management within our company;

• locate additional office space in the United States as well as internationally; and

• maintain close coordination among our engineering, operations, legal, finance, sales and marketing and customer service and support organizations.

Moreover, as our sales increase, we may be required to concurrently deploy our services infrastructure at multiple locations or provide increased levels of customization. As a result, we may lack the resources to deploy our mobile data services on a timely and cost-effective basis. Failure to accomplish any of these requirements

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would seriously harm our ability to deliver our mobile data services platform in a timely fashion, fulfill existing customer commitments or attract and retain new customers.

We depend on the services of key personnel to implement our strategy. If we lose the services of our key personnel or are unable to attract and retain other qualified personnel, we may be unable to implement our strategy.

We believe that the future success of our business depends on the services of a number of key management and operating personnel, including Henry R. Nothhaft, our Chief Executive Officer and Chairman of the Board of Directors, Joe F. Britt, Jr., our founder and Chief Technology Officer, Matt Hershenson, our founder and Senior Vice President of Advanced Products, and other members of our senior management. We have at-will employment relationships with all of our management and other employees. Some of these key employees have strong relationships with our OEM partners or mobile operator customers and our business may be harmed if these employees leave us. The loss of members of our key management and certain other members of our operating personnel could materially and adversely affect our business.

In addition, our ability to manage our growth depends, in part, on our ability to identify, hire and retain additional qualified employees, including a technically skilled development and engineering staff. We face intense competition for qualified individuals from numerous technology, marketing and mobile software and service companies. In addition, competition for qualified personnel is particularly intense in the San Francisco Bay Area, where our headquarters are located. Qualified individuals are in high demand, and we may incur significant costs to attract them. We may be unable to attract and retain suitably qualified individuals who are capable of meeting our growing creative, operational and managerial requirements, or may be required to pay increased compensation in order to do so. If we are unsuccessful in attracting and retaining these key personnel, our ability to operate our business effectively would be negatively impacted and our business would be adversely affected.

Future acquisitions of businesses or technologies may dilute the ownership interests of our stockholders, cause us to incur debt or assume contingent liabilities and strain our business and resources.

In order to remain competitive, we may find it necessary to acquire complementary businesses, products or technologies in the future. In the event of any future acquisitions, we could:

• issue equity securities that would dilute current stockholders’ percentage ownership;

• incur substantial debt;

• assume contingent liabilities; or

• expend significant cash.

These actions could harm our business, operating results and financial condition, or the price of our common stock. Moreover, even if we do obtain benefits from acquisitions in the form of increased revenues, there may be a delay between the time when the expenses associated with an acquisition are incurred and the time when we recognize such benefits. This is particularly relevant in cases where it is necessary to integrate new types of technology into our existing mobile data services platform and where new types of products may be targeted for potential operator customers with which we do not have pre-existing relationships. Acquisitions and investment activities also entail numerous risks, including:

• difficulties in the assimilation of acquired operations and technologies;

• unanticipated costs associated with the acquisition transaction;

• the diversion of management’s attention from other business;

• adverse effects on existing business relationships with our OEM partners and mobile operator customers;

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• risks associated with entering geographic or consumer markets in which we have no or limited prior experience;

• the potential loss of key employees of acquired businesses;

• difficulties in the assimilation of different corporate cultures and practices; and

• substantial charges for the amortization of certain purchased intangible assets, deferred stock compensation or similar items.

We may not be able to successfully integrate any businesses, products, technologies or personnel that we might acquire in the future, and our failure to do so could have a material adverse effect on our business, operating results and financial condition.

Our expansion in international markets may be subject to added business, political, regulatory, operational, financial and economic risks that could increase our costs and hinder our growth.

Our growth strategy involves the expansion of our operations in foreign jurisdictions. International sales represented approximately 8.2% of our revenues in the year ended September 30, 2006 and 6.5% of our revenues in the year ended September 30, 2007. We currently have an office in the United Kingdom, and we contract with offshore engineering centers in India, Ukraine and Romania. We expect international sales to contribute to our future revenues. We have limited experience conducting business outside of the United States, and we may not be aware of all of the factors that may affect our business in foreign jurisdictions. International operations carry certain risks and associated costs, such as:

• the complexities and expense of administering a business abroad;

• complications in compliance with, and unexpected changes in, regulatory requirements;

• foreign laws, including data privacy laws, as well as international import and export legislation;

• trading and investment policies;

• consumer protection laws that impose additional obligations on us or restrict our ability to provide limited warranty protection;

• corruption, requests for improper payments or other actions that may violate U.S. foreign corrupt practices acts, uncertain legal enforcement and physical security;

• foreign currency fluctuations;

• exchange or pricing controls;

• tariffs and other trade barriers;

• difficulties in collecting accounts receivable;

• potential adverse tax consequences;

• uncertainties of laws and enforcement relating to the protection of intellectual property;

• unauthorized copying of software;

• political, economic and social instability;

• difficulty in managing a geographically dispersed workforce in compliance with diverse local laws and customs; and

• other factors, depending upon the country involved.

In addition, developing mobile data services that are compatible with other languages or cultures can be expensive. As a result, our ongoing international expansion efforts may be more costly than we expect. Further, expansion into developing countries subjects us to the effects of regional instability, civil unrest and

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hostilities, and could adversely affect us by disrupting communications and making travel more difficult. As we continue to expand our business internationally, our success will depend, in large part, on our ability to anticipate and effectively manage these and other risks associated with our international operations. However, any of these factors could adversely affect our international operations and, consequently, our operating results.

Changes to financial accounting standards and the interpretation of those standards could affect the way we recognize and report our financial results and could make it more expensive to issue stock options to employees, either of which would negatively impact our business.

We prepare our financial statements to conform with accounting principles generally accepted in the United States. These accounting principles are subject to interpretation by the Financial Accounting Standards Board, or FASB, the Securities and Exchange Commission, or SEC, and various other regulatory bodies. A change in those principles could have a significant effect on our reported results and might affect our reporting of transactions completed before a change is announced. For example, we have used stock options as a fundamental component of our employee compensation packages. We believe that stock options directly motivate our employees to maximize long-term stockholder value and, through the use of vesting, encourage employees to remain in our employ. Several regulatory agencies and entities have made regulatory changes that could make it more difficult or expensive for us to grant stock options to employees. For example, the FASB released Statement of Financial Accounting Standards No. 123(R), Share-Based Payment, that required us to record a charge to earnings for employee stock option grants beginning October 1, 2006. We have, as a result of these changes, incurred increased compensation costs, which may cause us to change our equity compensation strategy. Any such change may make it more difficult to attract, retain and motivate employees.

Our results may vary significantly from period to period due to the timing of the release of new Danger-enabled mobile device models or new premium applications, content and services, as well as the seasonality of the mobile device market.

We may experience spikes in new subscriber activations and premium applications, content and services revenues as a result of the release of new Danger-enabled mobile device models or new premium applications, content and services. In addition, during the holiday shopping season, mobile device sales typically increase, driving new subscriber activations and an increase in premium applications and content downloads. If we or our OEM partners fail to introduce new Danger-enabled mobile devices and new mobile data services, for any reason, and particularly during key selling periods, our sales will suffer disproportionately. Likewise, if a key event to which our premium applications, content and services release schedule is tied were to be delayed or cancelled, our sales would also suffer disproportionately. Our ability to meet development schedules is affected by a number of factors, including the creative processes involved and the coordination of large and sometimes geographically dispersed development teams required by the increasing complexity of our mobile data services. Any failure to meet anticipated development or release schedules would likely result in a delay of revenues or possibly a significant shortfall in our revenues and cause our operating results to be materially different than anticipated.

If we become profitable, we cannot assure you that our net operating losses will be available to reduce our tax liability.

Our ability to use our tax net operating loss carryforwards may be limited or reduced. Generally, a change of more than 50 percentage points in the ownership of our shares, by value, over the three-year period ending on the date any shares are acquired constitutes an ownership change and may limit our ability to use net operating loss carryforwards. Furthermore, the number of shares of our common stock issued in our initial public offering may be sufficient, taking into account prior or future changes in our ownership over a three-year period, to cause us to undergo an ownership change. As a result, our ability to use our existing net operating losses to offset U.S. taxable income may become subject to substantial limitations. Further, the amount of our net operating losses could be reduced if any tax deductions taken by us are limited or disallowed by the Internal Revenue Service. All of these limitations could potentially result in increased future tax liability for us.

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Our business could be seriously harmed by earthquakes and other natural disasters.

Our headquarters and our current data center facilities are located in Palo Alto, California and San Jose, California, respectively, and our largest mobile operator customer has facilities located elsewhere in the Pacific Rim, which are areas subject to significant earthquake risks. Any disruption to the networks of this mobile operator customer or our data center facilities resulting from earthquakes or other natural disasters could significantly harm our business.

Risks Related to Our Industry

Changes in the wireless communications industry may adversely affect our business.

The wireless communications industry may experience significant growth and change which could adversely affect our business. New technologies such as Wi-Fi, worldwide interoperability for microwave access, or WiMAX, and voice over Internet protocol, or VOIP, are challenging existing wireless communication technologies. Future growth and adoption of these or other technologies may cause our mobile operator customers to revise or abandon their relationships with us and may cause other mobile operators not to become our customers. This would have an adverse effect on our business, operating results and financial condition. In addition, new entrants to the wireless communication industry offering new business models may challenge existing norms and disrupt the industry. For instance, Google recently announced the formation of the Open Handset Alliance, a consortium of mobile operators, mobile handset manufacturers and software and mobile computing companies focused on developing an open source software platform for mobile devices. In addition, Verizon Wireless recently announced that it will open its network to wireless devices, software and applications that are not sold by Verizon Wireless in an effort to expand its customer base. Changes in the industry caused by such new developments or other entrants, may cause our mobile operator customers to revise or abandon their relationships with us and may cause other mobile operators to choose our competitors. This would have an adverse effect on our business, operating results and financial condition.

Changes in government regulation of the wireless communications industry may adversely affect our business.

It is possible that a number of laws and regulations may be adopted in the United States and elsewhere that could restrict the wireless communications industry, including laws and regulations regarding lawful interception of personal data, taxation, content suitability, copyright, distribution and antitrust. Furthermore, the growth and development of the market for electronic storage of personal information may prompt calls for more stringent consumer protection laws that may impose additional burdens on companies such as ours that store personal information. We anticipate that regulation of our industry will increase and that we will be required to devote legal and other resources to address this regulation. Changes in current laws or regulations or the imposition of new laws and regulations in the United States or elsewhere regarding the media and wireless communications industries may lessen the growth of wireless communications services and may materially reduce our ability to increase or maintain sales of our mobile data services.

A number of studies have examined the health effects of mobile device use, and the results of some of the studies have been interpreted as evidence that mobile device use causes adverse health effects. The establishment of a link between the use of mobile devices and health problems, or any media reports suggesting such a link, could increase government regulation of, and reduce demand for, mobile devices and, accordingly, the demand for our mobile data services, and this could harm our business, operating results and financial condition.

The transmission and storage of personal information could give rise to liabilities or additional costs of operation as a result of governmental regulation, legal requirements or differing views of personal privacy rights.

We transmit and store a large volume of personal information in the course of providing our mobile data services. This information is increasingly subject to legislation and regulations in numerous jurisdictions around

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the world. This government action is typically intended to protect the privacy and security of personal information that is collected, stored and transmitted in or from the governing jurisdiction.

We could be adversely affected if domestic or international legislation or regulations are expanded to require changes in our business practices or if governing jurisdictions interpret or implement their legislation or regulations in ways that negatively affect our business. For example, the USA PATRIOT Act provides certain rights to U.S. law enforcement authorities to obtain personal information in the control of U.S. persons and entities without notifying the affected individuals. If we are required to allocate significant resources to modify our mobile data services platform to enable enhanced legal interception of the personal information that we transmit and store, our financial condition and results of operations may be adversely affected.

In addition, because various foreign jurisdictions have different laws and regulations concerning the storage and transmission of personal information, we may face unknown requirements that pose compliance challenges in new international markets that we seek to enter. Such variation could subject us to costs, liabilities or negative publicity that could impair our ability to expand our operations into some countries and therefore limit our future growth.

As privacy and data protection have become more sensitive issues, we may also become exposed to potential liabilities as a result of differing views on the privacy of personal information. These and other privacy concerns, including security breaches, could adversely impact our business, financial condition and results of operations.

Reduced spending by our customers due to the uncertainty of economic and geopolitical conditions may negatively affect our business and results of operations.

Economic and geopolitical uncertainties may directly affect the marketing and distribution of our mobile data services by mobile operators. As current and future conditions in the domestic and global economies remain uncertain, it is difficult to estimate the level of economic growth, which may cause some mobile operators to reduce capital spending on technology products. Accordingly, the future direction of the overall domestic and global economies will have an impact on our overall performance. Economic conditions in the United States, Japan, Europe and elsewhere affecting the wireless industry in which we compete, are beyond our control. If these economic conditions worsen or fail to improve, we may experience reduced demand for and pricing pressure on our mobile data services, which could harm our operating results. In addition, acts of terrorism and the outbreak of hostilities and armed conflicts between countries have created uncertainties that may affect the global economy and could have a material adverse effect on our business, operating results and financial condition.

Mergers, consolidation or other strategic transactions in the communications industry could weaken our competitive position, reduce the number of our mobile operator customers and adversely affect our business.

The communications industry continues to experience consolidation and an increased formation of alliances among communications service providers and between communications service providers and other entities. Should one of our significant mobile operator customers, such as T-Mobile USA, consolidate or enter into an alliance with another entity, this could have a negative material impact on our business. Such a consolidation and alliance may cause us to lose a mobile operator customer or require us to reduce prices as a result of enhanced customer leverage, which would have a material adverse effect on our business. We may not be able to offset the effects of any price reductions. We may not be able to expand our base of mobile operator customers to make up any revenue declines if we lose a mobile operator customer or if our transaction volumes decline.

In addition, if two or more of our competitors or mobile operator customers were to merge or partner, the change in the competitive landscape could adversely affect our ability to compete effectively. Our competitors

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may also establish or strengthen co-operative relationships with their mobile operator customers, sales channel partners or other parties with whom we have strategic relationships, thereby limiting our ability to promote our mobile data services. These events could reduce revenue and adversely affect our operating results.

Risks Related to the Offering and Our Common Stock

There has been no prior public market for our common stock, the trading price of our common stock is likely to be volatile, and you might not be able to sell your shares at or above the initial public offering price.

There has been no public market for our common stock prior to this offering. Investors who purchase our common stock in this offering may not be able to sell their shares at or above the initial public offering price. Market prices for companies similar to us experience significant price and volume fluctuations. An active or liquid market in our common stock may not develop upon completion of this offering or, if it does develop, it may not be sustainable. The following factors, in addition to other risks described in this prospectus, may have a significant effect on our common stock market price:

• variations in our operating results;

• announcements of technological innovations, new services or service enhancements, strategic alliances or agreements by us, our partners or by our competitors;

• the gain or loss of mobile operator customers;

• disputes or other developments relating to proprietary rights, including patents, litigation matters and related indemnity claims against us by our mobile operator customers or our OEM partners;

• changes in the market prices for our mobile data services;

• recruitment or departure of key personnel;

• actual or anticipated changes in the estimates of our operating results or changes in stock market analyst recommendations regarding our common stock, other comparable companies or our industry generally;

• market conditions in our industry, the industries of our customers and the economy as a whole;

• our ability or inability, if needed, to raise additional capital and the terms on which we raise it;

• actual or expected changes in our growth rates or our competitors’ growth rates;

• changes in the market valuation of similar companies;

• trading volume of our common stock;

• sales of our common stock by us or our stockholders; and

• adoption or modification of regulations, policies, procedures or programs applicable to our business.

In addition, if the market for technology stocks or the stock market in general experiences loss of investor confidence, the trading price of our common stock could decline for reasons unrelated to our business, financial condition or operating results. The trading price of our common stock might also decline in reaction to events that affect other companies in our industry even if these events do not directly affect us. Each of these factors, among others, could harm the value of your investment in our common stock. In the past, following periods of volatility in the market, securities class-action litigation has often been instituted against companies. Such litigation, if instituted against us, could result in substantial costs and diversion of management’s attention and resources, which could materially and adversely affect our business, financial condition, results of operations and growth prospects.

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Our securities have no prior market and an active trading market for our common stock may not develop.

Prior to this offering, there has been no public market for our common stock. Although we expect that our common stock will be approved for listing on the NASDAQ Global Market, an active trading market for our shares may never develop or, even if developed, may not be sustained following this offering. The initial public offering price for our common stock was determined through negotiations with the underwriters, and the negotiated price may not be indicative of the market price of the common stock after the offering. This initial public offering price may vary from the market price of our common stock after the offering. As a result of these and other factors, you may be unable to resell your shares of our common stock at or above the initial public offering price.

Future equity issuances or sales of our common stock in the public market could cause our stock price to decline.

If we issue equity securities in the future or if our stockholders sell a substantial number of shares of our common stock in the public market after this offering, or if there is a perception that these sales or issuances might occur, the market price of our common stock could decline. Based on the number of shares of common stock outstanding as of September 30, 2007, upon the closing of this offering, and assuming no outstanding options are exercised prior to the closing of this offering, we will             have shares of common stock outstanding (including             shares of common stock to be issued upon the exercise of outstanding warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, assuming a deemed market price equal to the assumed initial public offering price of $             per share, and             shares of common stock to be issued upon the exercise of other outstanding warrants for cash that will terminate if not exercised prior to the closing of this offering). All of the             shares of common stock sold in this offering will be freely tradable without restrictions or further registration under the Securities Act of 1933, as amended, except for any shares purchased by our affiliates as defined in Rule 144 under the Securities Act of 1933, as amended. The remaining             shares of common stock outstanding upon the closing of this offering will be restricted as a result of securities laws or lock-up agreements. These remaining shares will generally become available for sale in the public market as follows:

• no restricted shares will be eligible for immediate sale upon the closing of this offering; and

• all of the restricted shares of common stock, less shares subject to a repurchase option in our favor tied to the holders’ continued service to us (which will be eligible for sale upon lapse of the repurchase option), will be eligible for sale upon expiration of lock-up agreements 180 days after the date of this prospectus, which period may be extended in certain limited circumstances.

Deutsche Bank Securities Inc. and UBS Securities LLC may, in their sole discretion, release all or some portion of the shares subject to lock-up agreements prior to the expiration of the lock-up period. See “Shares Eligible for Future Sale.”

After this offering, the holders of approximately             shares of common stock, based on shares outstanding as of September 30, 2007, including             shares underlying outstanding warrants, will be entitled to rights with respect to registration of such shares under the Securities Act of 1933, as amended. If such holders, by exercising their registration rights, sell a large number of shares, they could adversely affect the market price for our common stock. If we file a registration statement and include shares held by these holders pursuant to the exercise of their registration rights, these sales may impair our ability to raise capital. In addition, prior to the consummation of this offering, we intend to file a registration statement on Form S-8 under Securities Act to register up to shares of our common stock for issuance under our stock option and employee stock purchase plans. Once we register these shares, they can be freely sold in the public market upon issuance, subject to the lock-up agreements, if applicable, described above.

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Our executive officers, directors and principal stockholders will continue to have substantial control over us after this offering and will be able to exercise significant influence over matters subject to stockholder approval.

Our executive officers, directors and principal stockholders, together with their respective affiliates, beneficially owned approximately 53.9% of our capital stock as of September 30, 2007, and we expect that upon completion of this offering, that same group will beneficially own at least     % of our outstanding common stock, of which     % will be beneficially owned by our executive officers, assuming no exercise of the underwriters’ over-allotment option. Accordingly, these stockholders, if they act together, will be able to exercise influence over all matters requiring stockholder approval, including the election of directors and approval of corporate transactions, such as a merger or other sale of our company or its assets. This concentration of ownership could have the effect of delaying or preventing a change in our control or otherwise discouraging a potential acquirer from attempting to obtain control of us, which in turn could have a material adverse effect on the market value of our common stock. For information regarding the ownership of our outstanding stock by our executive officers and directors and their affiliates, please see the section entitled “Principal Stockholders.”

As a new investor, you will experience substantial dilution as a result of this offering.

Our assumed initial public offering price per share is substantially higher than the pro forma net tangible book value per share of our common stock outstanding prior to this offering. As a result, investors purchasing common stock in this offering will experience immediate substantial dilution of $             a share. In addition, we have issued options and warrants to acquire common stock at prices below the assumed initial public offering price. To the extent outstanding options and warrants are ultimately exercised, including warrants that will terminate if not exercised prior to the closing of this offering, there will be further dilution to investors in this offering. This dilution is due in large part to the fact that our earlier investors paid substantially less than the assumed initial public offering price when they purchased their shares of common stock. In addition, if the underwriters exercise their over-allotment option, you will experience additional dilution.

Anti-takeover provisions in our charter documents and Delaware law could discourage, delay or prevent an acquisition of us by others, even if an acquisition would be beneficial to our stockholders, and may affect the trading price of our common stock.

We are a Delaware corporation and the anti-takeover provisions of the Delaware General Corporation Law, that apply to us, may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change of control would be beneficial to our existing stockholders. For more information, see the section entitled “Description of Capital Stock—Anti-Takeover Effects of Our Charter and Bylaws and Delaware Law.”

In addition, our amended and restated certificate of incorporation and amended and restated bylaws, which will be in effect as of the closing of this offering, could make it more difficult for a third party to acquire us, or for a change in the composition of our board of directors or management to occur, even if doing so would benefit our stockholders. These provisions include:

• authorizing the issuance of “blank check” preferred stock, the terms of which may be established and shares of which may be issued without stockholder approval to thwart a takeover attempt;

• establishing a classified board of directors, as a result of which the successors to the directors whose terms have expired will be elected to serve from the time of election and qualification until the third annual meeting following their election;

• requiring that directors only be removed from office for cause and only upon a supermajority stockholder vote;

• providing that vacancies on the board of directors, including newly-created directorships, may be filled only by a majority vote of directors then in office rather than by stockholders;

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• eliminating the ability of stockholders to call a special meeting of stockholders;

• prohibiting stockholder action by written consent, thereby requiring all stockholder actions to be taken at a meeting of our stockholders; and

• establishing advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted upon at stockholder meetings.

In addition, we are subject to Section 203 of the Delaware General Corporation Law, which generally prohibits a Delaware corporation from engaging in any of a broad range of business combinations with an interested stockholder for a period of three years following the date on which the stockholder became an interested stockholder, unless such transactions are approved by our board of directors. This provision could have the effect of delaying or preventing a change of control, whether or not it is desired by or beneficial to our stockholders.

Restrictions in our material agreements with our mobile operator customers and OEM partners may prevent us from being acquired.

Several of our major agreements with our mobile operator customers, including T-Mobile USA, and with our OEM partners contain provisions that do not allow assignment of our agreement without the prior consent of the mobile operator customer or OEM partner, as the case may be. These provisions could deter a potential acquirer from acquiring us and therefore limit the liquidity opportunities for our stockholders.

Our management will have broad discretion over the use and investment of the net proceeds we receive in this offering and might not apply the proceeds in ways that increase the value of your investment.

Our management will have broad discretion over the use and investment of the net proceeds from this offering, and you will be relying on the judgment of our management regarding the application of these net proceeds. Our management might not apply the net proceeds of this offering in ways that increase the value of your investment. Our management intends to use the net proceeds from this offering to repay certain of our credit facilities and for general corporate purposes, including to finance the expansion of our data centers and to fund capital expenditures, or for investments in, or acquisitions of, complementary companies, technologies, products or assets. Pending these uses, we intend to invest the net proceeds of this offering in a variety of investment-grade capital preservation investments, including short- and intermediate-term interest bearing obligations, certificates of deposit or direct or guaranteed obligations of the U.S. government. Our management might not be able to yield a significant return, if any, on any investment of these net proceeds. You will not have the opportunity to influence our decisions on how the net proceeds from this offering are used.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.

The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. We may never obtain research coverage by securities and industry analysts. If no securities or industry analysts commence coverage of our company, the trading price for our common stock would be negatively impacted. In the event we obtain securities or industry analyst coverage, if one or more of the analysts who cover us downgrade our stock or publish inaccurate or unfavorable research about our business, our stock price would likely decline. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline.

We will incur significant increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives.

As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company. In addition, the Sarbanes-Oxley Act of 2002, and rules of the Securities and Exchange

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Commission and the NASDAQ Global Market, have imposed various requirements on public companies including requiring establishment and maintenance of effective disclosure and financial controls. Our management and other personnel will need to devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to incur substantial costs to maintain the same or similar coverage.

The Sarbanes-Oxley Act of 2002 requires, among other things, that we maintain effective internal control over financial reporting and disclosure controls and procedures. In particular, we must perform system and process evaluation and testing of our internal control over financial reporting to allow management and our independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, beginning with our annual report on Form 10-K for the fiscal year ending September 30, 2009. Our compliance with Section 404 of the Sarbanes-Oxley Act will require that we incur substantial accounting expense and expend significant management efforts. We currently do not have an internal audit group, and we will need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge. If we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent registered public accounting firm identify deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our stock could decline and we could be subject to sanctions or investigations by NASDAQ, the SEC or other regulatory authorities, which would require additional financial and management resources.

Our ability to successfully implement our business plan and comply with Section 404 requires us to be able to prepare timely and accurate financial statements. We expect that we will need to continue to improve existing, and implement new operational and financial systems, procedures and controls to manage our business effectively. Any delay in the implementation of, or disruption in the transition to, new or enhanced systems, procedures or controls, may cause our operations to suffer and we may be unable to conclude that our internal control over financial reporting is effective and to obtain an unqualified report on internal controls from our auditors as required under Section 404 of the Sarbanes-Oxley Act. Moreover, we cannot be certain that these measures would ensure that we implement and maintain adequate controls over our financial processes and reporting in the future. Even if we were to conclude, and our auditors were to concur, that our internal control over financial reporting provided reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, because of its inherent limitations, internal control over financial reporting may not prevent or detect fraud or misstatements. This, in turn, could have an adverse impact on trading prices for our common stock, and could adversely affect our ability to access the capital markets.

We have never declared or paid dividends on our capital stock and we do not anticipate paying dividends in the foreseeable future.

We have never declared or paid cash dividends on our capital stock. We currently intend to retain all available funds and any future earnings to support the operation of and to finance the growth and development of our business. Any future determination to declare cash dividends will be made at the discretion of our board of directors, subject to compliance with applicable laws and covenants under current or future credit facilities, which may restrict or limit our ability to pay dividends, and will depend on our financial condition, operating results, capital requirements, general business conditions and other factors that our board of directors may deem relevant. We do not anticipate paying any cash dividends on our common stock in the foreseeable future. As a result, a return on your investment will only occur if our stock price appreciates.

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FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that involve risks and uncertainties. The forward-looking statements are contained principally in the sections entitled “Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business.” These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. Forward-looking statements made herein include, but are not limited to, statements about:

• anticipated trends and challenges in our business and the markets in which we operate;

• our ability to successfully maintain and expand our current, and develop new, mobile operator relationships and relationships with OEM partners;

• future development and distribution by our OEM partners of mobile devices that utilize our mobile data services platform;

• our ability to compete in our industry and respond to competitive developments;

• our ability to address market needs or develop new or enhanced mobile data services to meet those needs;

• expected adoption of our mobile data services by subscribers;

• our ability to grow our revenues and improve our operating results;

• our ability to protect our confidential information and intellectual property rights;

• our ability to attract, integrate and retain qualified personnel;

• our ability to scale our mobile data services platform, manage our growth and expand into new geographic and consumer markets;

• our need to obtain additional funding and our ability to obtain funding in the future on acceptable terms; and

• our expectations regarding the use of proceeds from this offering.

In some cases, you can identify forward-looking statements by terms such as “may,” “might,” “will,” “objective,” “intend,” “should,” “could,” “can,” “would,” “expect,” “target,” “believe,” “estimate,” “predict,” “potential,” “plan,” “anticipate,” “seek,” “project,” or the negative of these terms, and similar expressions intended to identify forward-looking statements. These statements reflect our current views with respect to future events and are based on assumptions and subject to risks and uncertainties. Given these uncertainties, you should not place undue reliance on these forward-looking statements. We discuss many of these risks in this prospectus in greater detail under the heading “Risk Factors.” Also, these forward-looking statements represent our estimates and assumptions only as of the date of this prospectus. Unless required by U.S. federal securities laws, we do not intend to update any of these forward-looking statements to reflect circumstances or events that occur after the statement is made.

You should read this prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement, of which this prospectus is a part, completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. The Private Securities Litigation Reform Act of 1995 and Section 27A of the Securities Act of 1933 do not protect any forward-looking statements that we make in connection with this offering.

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USE OF PROCEEDS

We estimate that our net proceeds from the sale of the common stock that we are offering will be approximately $             million, assuming an initial public offering price of $             per share, which is the mid-point of the range reflected on the cover page of this prospectus, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. If the underwriters’ over-allotment option to purchase additional shares in this offering is exercised in full, we estimate that our net proceeds will be approximately $             million, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. Each $             increase (decrease) in the assumed initial public offering price of $             per share would increase (decrease) the net proceeds to us from this offering by approximately $             million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same. We may also increase or decrease the number of shares we are offering. Each increase (decrease) of             shares in the number of shares offered by us would increase (decrease) the net proceeds to us from this offering by approximately $             million, assuming that the assumed initial public offering price remains the same, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. We do not expect that a change in the offering price or the number of shares by these amounts would have a material effect on our uses of the proceeds from this offering, although it may accelerate the time at which we will need to seek additional capital.

We intend to use approximately $7.2 million of the net proceeds of this offering to repay in full the principal and accrued interest on our outstanding term loan from Silicon Valley Bank and the principal and accrued interest on, together with the payment of additional fees related to, our outstanding equipment lease advances from Atel Ventures, Inc. Our intent to use approximately $7.2 million of the net proceeds of this offering to repay these credit facilities is based on amounts outstanding under these credit facilities as of November 30, 2007. Our outstanding term loan from Silicon Valley Bank carries an interest rate of 8.3% and matures in December 2010. Our outstanding equipment lease advances from Atel Ventures carry a weighted average interest rate of 11.9% and mature in November 2009, January 2010 and February 2010. We have used the proceeds of these credit facilities primarily to finance data center equipment and software development license acquisitions.

We intend to use the remaining net proceeds of this offering for working capital and other general corporate purposes, including to finance the expansion and operation of our data centers, to fund capital expenditures and to support our research and development and sales and marketing activities. We may also use a portion of the net proceeds of this offering for the acquisition of, or investment in, companies, technologies, products or assets that complement our business. However, we have no present understandings, commitments or agreements to enter into any acquisitions or to make any of these types of investments.

We have not yet determined our anticipated expenditures and therefore cannot estimate the amounts to be used for each of the purposes discussed above. The amounts and timing of our expenditures will depend on several factors, including the amount of cash generated by our operations, competitive and technological developments, the rate of growth, if any, of our business and actual expenses to operate our business. Accordingly, our management will have significant flexibility in applying the net proceeds of this offering, and investors will be relying on the judgment of our management regarding the application of these net proceeds. Pending use of proceeds from this offering, we intend to invest the net proceeds of this offering in a variety of investment-grade capital preservation investments, including short- and intermediate-term interest bearing obligations, certificates of deposit or direct or guaranteed obligations of the U.S. government. Our management might not be able to yield a significant return, if any, on any investment of these net proceeds.

DIVIDEND POLICY

We have never declared or paid cash dividends on our capital stock. We currently intend to retain all available funds and any future earnings to support the operation of and to finance the growth and development of our business. We do not anticipate paying any cash dividends in the foreseeable future. Any future determination to declare cash dividends will be made at the discretion of our board of directors, subject to compliance with applicable laws and covenants under current or future credit facilities, which may restrict or limit our ability to pay dividends, and will depend on our financial condition, operating results, capital requirements, general business conditions and other factors that our board of directors may deem relevant.

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CAPITALIZATION

The following table sets forth our capitalization as of September 30, 2007:

• on an actual basis;

• on a pro forma basis to give effect to:

• the conversion of all of our outstanding shares of our preferred stock into 168,133,864 shares of common stock upon the closing of this offering;

• the exercise of warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, resulting in the net issuance of             shares of common stock, assuming a deemed market price equal to the assumed initial public offering price of $             per share, the mid-point of the price range reflected on the cover page of this prospectus; and

• the reclassification of preferred stock warrant liability to common stock and additional paid-in capital upon the closing of this offering; and

• on a pro forma as adjusted basis to give further effect to the sale by us of             shares of common stock in this offering at an assumed initial public offering price of $             per share, after deducting underwriting discounts and commissions and estimated offering expenses payable by us, and the repayment of amounts outstanding under an equipment lease line, which had an outstanding balance of approximately $3.8 million as of September 30, 2007.

You should read this table together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and the related notes, each appearing elsewhere in this prospectus.

	As of September 30, 2007
	Actual			Pro Forma	Pro Forma As Adjusted(2)
	(In thousands, except per share data)
Cash and cash equivalents	$	12,979		$	$
Installment payable, including current portion	$	885		$	$
Capital lease obligations, including current maturities		4,501
Preferred stock warrant liability		12,180
Redeemable convertible preferred stock, $0.0001 par value; 175,440,562 authorized, 148,902,132 shares issued and outstanding actual; no shares authorized, issued and outstanding, pro forma and pro forma as adjusted		197,623
Stockholders’ equity (deficit):
Preferred stock, $0.0001 par value; no shares authorized, issued and outstanding, actual and pro forma; 20,000,000 shares authorized, no shares issued and outstanding, pro forma as adjusted		—
Common stock, $0.0001 par value, 260,000,000 shares authorized, 17,930,106 shares issued and outstanding, actual; 260,000,000 shares authorized,              shares issued and outstanding, pro forma; 200,000,000 shares authorized,              shares issued and outstanding, pro forma as adjusted(1)		2
Additional paid-in capital		1,687
Accumulated deficit		(188,101	)
Total stockholders’ equity (deficit)		(186,412	)
Total capitalization	$	28,777		$	$

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(1) The pro forma and pro forma as adjusted issued and outstanding shares of common stock assumes the issuance of             shares of common stock upon the exercise of warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, assuming a deemed market price equal to the assumed initial public offering price of $             per share. The actual number of shares of our common stock to be issued upon the automatic cashless exercise of these warrants depends on the deemed market price of our common stock immediately prior to the date of exercise. See “Description of Capital Stock—Warrants.” A $             increase in the assumed deemed market price of $             per share would increase the number of shares of common stock to be issued upon the automatic cashless exercise of these warrants by approximately             shares of common stock, and a $             decrease in the assumed deemed market price of $             per share would decrease the number of shares of common stock to be issued upon the automatic cashless exercise of these warrants by approximately             shares of common stock.

(2) Each $             increase (decrease) in the assumed initial public offering price of $             per share would increase (decrease) each of additional paid-in capital, total stockholders’ equity and total capitalization by approximately $             million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. We may also increase or decrease the number of shares we are offering. Each increase (decrease) of             shares in the number of shares offered by us would increase (decrease) each of additional paid-in capital, total stockholders’ equity and total capitalization by approximately $             million, assuming that the assumed initial public offering price remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The pro forma as adjusted information discussed above is illustrative only and will adjust based on the actual initial public offering price and other terms of this offering determined at pricing.

The table above excludes, as of September 30, 2007, the following shares:

• 42,861,396 shares of common stock issuable upon the exercise of options outstanding under our 2000 Stock Option/Stock Issuance Plan, or 2000 plan, having a weighted average exercise price of $0.35 per share;

• 6,525,841 shares of common stock issuable upon the exercise of outstanding warrants, having a weighted average exercise price of $0.83 per share, of which warrants to purchase 6,415,222 shares of common stock will terminate if not exercised prior to the closing of this offering;

• 2,056,194 shares of common stock reserved for future issuance under our 2000 plan; provided, however, that immediately upon the signing of the underwriting agreement for this offering, our 2000 plan will terminate so that no further awards may be granted under our 2000 plan; and

• an aggregate of up to             shares of common stock reserved for future issuance under our 2008 Equity Incentive Plan and 2008 Employee Stock Purchase Plan, as well as any automatic increases in the number of shares of our common stock reserved for future issuance under these benefit plans, both of which will become effective immediately upon the signing of the underwriting agreement for this offering.

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DILUTION

If you invest in our common stock in this offering, your ownership interest will be diluted immediately to the extent of the difference between the initial public offering price per share of our common stock and the pro forma as adjusted net tangible book value per share of our common stock after this offering. Our historical net tangible book value per share is determined by dividing our total tangible assets (total assets less intangible assets), less total liabilities, redeemable convertible preferred stock and common stock subject to repurchase, by the number of outstanding shares of our common stock. As of September 30, 2007, our historical net tangible book value (deficit) was $(186.4) million, or $(10.40) per share of our common stock. Our pro forma net tangible book value as of September 30, 2007 was approximately $             million, or $             per share of our common stock, based on the number of shares of common stock outstanding as of September 30, 2007, after giving effect to the conversion of all of our outstanding redeemable convertible preferred stock into shares of our common stock, the exercise of warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, and the reclassification of the preferred stock warrant liability to stockholders’ equity upon the closing of this offering.

Investors participating in this offering will incur immediate and substantial dilution. After giving effect to the sale of common stock offered by us at an assumed initial public offering price of $             per share, the mid-point of the price range reflected on the cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value as of September 30, 2007 would have been $             million, or $             per share of our common stock. This represents an immediate increase in pro forma as adjusted net tangible book value of $             per share to our existing stockholders, and an immediate dilution of $             per share to new investors participating in this offering. The following table illustrates this dilution:

Assumed initial public offering price per share				$
Historical net tangible book value (deficit) per share as of September 30, 2007	$	(10.40	)
Pro forma increase in net tangible book value per share attributable to conversion of redeemable convertible preferred stock and automatic cashless exercise of certain warrants
Pro forma net tangible book value per share before this offering	$
Pro forma increase in net tangible book value per share attributable to investors participating in this offering
Pro forma as adjusted net tangible book value per share after this offering
Pro forma dilution per share to new investors participating in this offering				$

A $             increase (decrease) in the assumed initial public offering price of $             per share would increase (decrease) our pro forma as adjusted net tangible book value by approximately $             million, or approximately $             per share, and the pro forma dilution per share to new investors in this offering by approximately $             per share, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. We may also increase or decrease the number of shares we are offering. An increase of             shares in the number of shares offered by us would increase our pro forma as adjusted net tangible book value by approximately $             million, or $             per share, and the pro forma dilution per share to new investors in this offering would be $             per share, assuming that the assumed initial public offering price remains the same, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. Similarly, a decrease of             shares in the number of shares offered by us would decrease our pro forma as adjusted net tangible book value by approximately $             million, or $             per share, and the pro forma dilution per share to new investors in this offering would be $             per share, assuming that the assumed initial public offering price remains the same, and after deducting the

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underwriting discounts and commissions and estimated offering expenses payable by us. The pro forma as adjusted information discussed above is illustrative only and will adjust based on the actual initial public offering price and other terms of this offering determined at pricing.

If the underwriters exercise their option in full to purchase             additional shares of common stock in this offering, the pro forma as adjusted net tangible book value per share after the offering would be $             per share, the increase in the pro forma as adjusted net tangible book value per share to existing stockholders would be $             per share and the pro forma dilution to new investors purchasing common stock in this offering would be $             per share.

The following table summarizes, on a pro forma as adjusted basis as of September 30, 2007, the differences between the number of shares of common stock purchased from us, the total consideration and the weighted average price per share paid by existing stockholders and by new investors participating in this offering at an assumed initial public offering price of $             per share, before deducting underwriting discounts and commissions and estimated offering expenses:

	Shares Purchased			Total Consideration			Weighted Average Price Per Share
	Number	Percent		Amount	Percent
Existing stockholders			%	$		%	$
New investors
Total		100	%	$	100	%

The above discussion and tables are based on             shares of common stock outstanding as of September 30, 2007, assuming the conversion of all outstanding redeemable convertible preferred stock into shares of common stock and the exercise of warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering. This number excludes, as of September 30, 2007:

• 42,861,396 shares of common stock issuable upon the exercise of options outstanding under our 2000 Stock Option/Stock Issuance Plan, or 2000 plan, having a weighted average exercise price of $0.35 per share;

• 6,525,841 shares of common stock issuable upon the exercise of outstanding warrants, having a weighted average exercise price of $0.83 per share, of which warrants to purchase 6,415,222 shares of common stock will terminate if not exercised prior to the closing of this offering;

• 2,056,194 shares of common stock reserved for future issuance under our 2000 plan; provided, however, that immediately upon the signing of the underwriting agreement for this offering, our 2000 plan will terminate so that no further awards may be granted under our 2000 plan; and

• an aggregate of up to             shares of common stock reserved for future issuance under our 2008 Equity Incentive Plan and 2008 Employee Stock Purchase Plan, as well as any automatic increases in the number of shares of our common stock reserved for future issuance under these benefit plans, both of which will become effective immediately upon the signing of the underwriting agreement for this offering.

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The following table summarizes, on a pro forma as adjusted basis as of September 30, 2007, after giving effect to the exercise in full of all of our stock options outstanding at September 30, 2007 and our issuance of 6,525,841 shares of common stock upon the exercise of warrants outstanding at September 30, 2007, the differences between the number of shares of common stock purchased from us, the total consideration and the weighted average price per share paid by existing stockholders and by new investors purchasing common stock in this offering at an assumed initial public offering price of $             per share, before deducting underwriting discounts and commissions and estimated offering expenses:

	Shares Purchased			Total Consideration			Weighted Average Price Per Share
	Number	Percent		Amount	Percent
Existing stockholders			%	$		%	$
New investors
Total		100	%	$	100	%

The number of shares of common stock outstanding in the table above is based on the pro forma number of shares outstanding as of September 30, 2007 and assumes no exercise of the underwriters’ option to purchase additional shares. If the underwriters’ option to purchase additional shares is exercised in full, the number of shares of common stock held by existing stockholders will be reduced to    % of the total number of shares of common stock to be outstanding after this offering, and the number of shares of common stock held by new investors purchasing common stock in this offering will be increased to             shares or    % of the total number of shares of common stock to be outstanding after this offering.

Effective upon the closing of this offering, an aggregate of up to             shares of our common stock will be reserved for future issuance under our equity benefit plans, and these share reserves will also be subject to automatic annual increases in accordance with the terms of the plans. To the extent that new options are issued under our equity benefit plans or we issue additional shares of common stock in the future, there will be further dilution to new investors purchasing common stock in this offering.

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SELECTED CONSOLIDATED FINANCIAL DATA

We present below our selected consolidated financial data. The selected consolidated statements of operations data for each of the years ended September 30, 2005, 2006 and 2007, and the selected consolidated balance sheet data as of September 30, 2006 and 2007, have been derived from our audited consolidated financial statements included elsewhere in this prospectus. The selected consolidated statements of operations data for each of the years ended September 30, 2003 and 2004, and the selected consolidated balance sheet data as of September 30, 2003, 2004 and 2005, have been derived from our audited consolidated financial statements that are not included in this prospectus. You should read this information together with our consolidated financial statements and related notes included elsewhere in this prospectus and the information under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Our historical results are not necessarily indicative of the results to be expected in any future period.

	Years Ended September 30,
	2003			2004			2005			2006			2007
	(In thousands, except per share data)
Consolidated Statements of Operations Data:
Revenues:
Service	$	—		$	481		$	21,669		$	38,895		$	50,581
Product		72			1,257			15,121			10,416			5,832
Total revenues		72			1,738			36,790			49,311			56,413
Cost of revenues:
Cost of service revenues		4,886			6,381			10,701			17,755			26,846
Cost of product revenues		9,165			10,814			16,220			9,130			5,276
Total cost of revenues		14,051			17,195			26,921			26,885			32,122
Gross profit (loss)		(13,979	)		(15,457	)		9,869			22,426			24,291
Operating expenses:
Research and development		11,141			13,135			11,317			17,746			22,497
Sales and marketing		3,989			4,834			5,211			5,723			7,020
General and administrative		3,165			3,519			3,610			6,999			6,541
Total operating expenses		18,295			21,488			20,138			30,468			36,058
Loss from operations		(32,274	)		(36,945	)		(10,269	)		(8,042	)		(11,767	)
Other income (expense), net		176			165			359			107			(520	)
Loss before provision for income taxes and cumulative effect of change in accounting principle		(32,098	)		(36,780	)		(9,910	)		(7,935	)		(12,287	)
Provision for income taxes		—			—			—			(54	)		(74	)
Loss before cumulative effect of change in accounting principle		(32,098	)		(36,780	)		(9,910	)		(7,989	)		(12,361	)
Cumulative effect of change in accounting principle		—			—			—			1,421			—
Net loss		(32,098	)		(36,780	)		(9,910	)		(6,568	)		(12,361	)
Accretion of redemption value on redeemable convertible preferred stock		(7,324	)		(10,218	)		(12,309	)		(14,477	)		(15,710	)
Net loss attributable to common stockholders	$	(39,422	)	$	(46,998	)	$	(22,219	)	$	(21,045	)	$	(28,071	)
Net loss per share attributable to common stockholders—basic and diluted:
Loss before cumulative effect of change in accounting principle	$	(2.45	)	$	(2.67	)	$	(0.69	)	$	(0.53	)	$	(0.76	)
Cumulative effect of change in accounting principle		—			—			—			0.09			—
Accretion of redemption value on redeemable convertible preferred stock		(0.56	)		(0.74	)		(0.85	)		(0.95	)		(0.96	)
Net loss per share attributable to common stockholders—basic and diluted	$	(3.01	)	$	(3.42	)	$	(1.54	)	$	(1.39	)	$	(1.72	)
Weighted average common shares outstanding—basic and diluted		13,097			13,756			14,396			15,142			16,353
Pro forma net loss per share—basic and diluted (unaudited)(1)													$	(0.06	)
Pro forma weighted average common shares outstanding—basic and diluted (unaudited)(1)														184,463

(1) Please see Note 3 to our consolidated financial statements for an explanation of the method used to compute pro forma basic and diluted net loss per common share and the number of shares used in computing per share amounts.

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	As of September 30,
	2003			2004			2005			2006			2007
	(In thousands)
Consolidated Balance Sheet Data:
Cash and cash equivalents	$	19,329		$	34,293		$	10,720		$	17,179		$	12,979
Short-term investments		8,356			2,501			902			—			—
Working capital		20,828			8,026			(7,126	)		6,943			8,961
Property and equipment, net		2,120			2,664			6,405			12,574			17,358
Total assets		45,607			72,276			46,250			47,626			49,024
Deferred revenues, including current portion		14,812			41,670			26,202			12,196			10,630
Installment payable, including current portion		—			—			—			1,550			885
Capital lease obligations, including current maturities		1,188			1,619			3,853			1,006			4,501
Preferred stock warrant liability		—			—			—			11,124			12,180
Redeemable convertible preferred stock		88,039			134,980			147,289			171,667			197,623
Total stockholders’ deficit		(69,435	)		(116,348	)		(138,323	)		(159,001	)		(186,412	)

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

You should read the following discussion and analysis in conjunction with our consolidated financial statements and related notes included elsewhere in this prospectus. In addition to historical financial information, this discussion contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results and timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Risk Factors” and elsewhere in this prospectus.

Overview

We are a software-as-a-service company that provides mobile operators with an integrated end-to-end solution to deliver mobile data and Internet services to their subscribers. As advanced Internet and messaging services are increasingly becoming available on mobile devices, our solution enables mobile operators to offer their subscribers a differentiated and more compelling mobile data and Internet experience and, consequently, helps our operator customers increase their average revenue per user. Our solution is deployed in the United States and certain international markets through the T-Mobile Sidekick family of mobile devices and in other international markets, such as Australia and Europe, through mobile devices utilizing our “hiptop” brand.

We sell the Danger solution directly to mobile operators through an internal sales force and in conjunction with our original equipment manufacturer, or OEM, partners. Under our agreements with mobile operators, we are paid recurring monthly service fees for each of their subscribers that can access our mobile data services and a share of fees for each premium application, content or service transaction with such subscriber. Our mobile data services run on Danger-enabled mobile devices which are designed and manufactured by our OEM partners and sold by them to our mobile operator customers under separate contractual arrangements. We are responsible for hosting our mobile data services, for which we utilize a third-party hosting data center.

We depend on T-Mobile USA, Inc., or T-Mobile USA, for substantially all of our revenues. For the years ended September 30, 2005, 2006 and 2007, T-Mobile USA represented 92.1%, 88.5% and 92.0% of our revenues, respectively. We expect that we will continue to generate a substantial majority of our revenues from T-Mobile USA for the foreseeable future.

The number of our customers’ subscribers using Danger-enabled mobile devices has increased substantially from approximately 136,000 as of September 30, 2004 to approximately 923,000 as of September 30, 2007. Our total revenues have grown from $49.3 million in the year ended September 30, 2006 to $56.4 million in the year ended September 30, 2007, and our service revenues have grown from $38.9 million in the year ended September 30, 2006 to $50.6 million in the year ended September 30, 2007. Since our inception, we have not been profitable. Our loss from operations was $10.3 million, $8.0 million and $11.8 million in the years ended September 30, 2005, 2006 and 2007, respectively and we expect to continue to incur operating losses for the foreseeable future. As of September 30, 2007 our accumulated deficit was $188.1 million. The last day of our fiscal year is September 30.

Our revenue growth will depend significantly on increasing the number of our customers’ subscribers using our mobile data services, as well as our ability to attract additional mobile operator customers. In an effort to increase the value of our solution for mobile operators, we intend to invest significantly in the development of compelling new features, applications and services, the establishment of new and broader relationships with mobile device OEMs, and the expansion of our hosting capabilities and other network infrastructure. Our ability to attain profitability will depend upon the extent to which these additional investments generate increased revenues from our mobile operator customers.

We were incorporated in Delaware in December 1999 and from our inception until September 2002, we were engaged principally in the development of our mobile data services platform and the design and

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development of the initial Danger-enabled mobile devices. Under our initial mobile operator customer contracts, we were responsible for the manufacture, sale and after market support of Danger-enabled mobile devices. In addition to monthly recurring service fees, these initial contractual arrangements with mobile operators included product revenues from the sale of Danger-enabled mobile devices to our mobile operator customers and client license fee revenues associated with the shipment of Danger-enabled mobile devices or the activation of our mobile data services on Danger-enabled mobile devices. We shipped the first Danger-enabled mobile device in September 2002.

In April 2004, we licensed the reference design for our Danger-enabled mobile device to Sharp Corporation, or Sharp, and Sharp assumed direct responsibility for the manufacture and sale of Danger-enabled mobile devices to mobile operators. Sharp commenced sales of Danger-enabled mobile devices in September 2004, and since that time, substantially all sales of Danger-enabled mobile devices have been made directly to mobile operators by our OEM partners, although we did continue to sell low volumes of Danger-enabled mobile devices manufactured by Sharp directly to certain mobile operator customers until March 2006. In connection with a new contractual arrangement with T-Mobile USA, which was effective June 2005, we ceased charging client license fees in connection with the shipment of Danger-enabled mobile devices to T-Mobile USA. In September 2006, we entered into an agreement with Motorola Corporation, or Motorola, for Motorola to design, manufacture and sell Danger-enabled mobile devices. In November 2007, T-Mobile USA commercially launched Motorola’s first Danger-enabled mobile device.

Overview of Consolidated Financial Data

Revenues

Our revenues include service revenues associated with monthly service fees, our share of fees associated with premium applications, content and services, client license fees and non-recurring engineering, or NRE, fees as well as product revenues associated with the sale of Danger-enabled mobile devices by us prior to March 2006.

The following table reflects our service and product revenues for the years ended September 30, 2005, 2006 and 2007:

	Years Ended September 30,
Revenues	2005		2006		2007
	(In thousands)
Service revenues	$	21,669	$	38,895	$	50,581
Product revenues		15,121		10,416		5,832
	$	36,790	$	49,311	$	56,413

Service Revenues.    We generate substantially all of our service revenues from mobile operators that provide our mobile data services to their subscribers through Danger-enabled mobile devices. We charge our mobile operator customers recurring monthly service fees based on the number of their subscribers that can access our mobile data services. We also generate revenues from the sale of premium applications, content and services, such as games, productivity applications, networked services, ringtones and background themes, offered by our mobile operator customers for download using Danger-enabled mobile devices and charged as a one-time fee or a monthly subscription fee. Our share of the fees generated from the sale of premium applications, content and services varies by mobile operator, content type and content source. Premium applications, content and services revenues are deferred and amortized over the longer of the remaining mobile operator’s contract term or the expected period of performance under the mobile operator’s contract. Our mobile operator customers are responsible for billing and collections of fees from their subscribers that can access our mobile data services, including our premium applications, content and services.

From time to time, we also generate service revenues associated with NRE fees charged for the initial deployment of our mobile data services or for customized development of specific features or applications for

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our mobile operator customers or the acceleration of certain features on their behalf. These revenues are deferred and amortized ratably over the longer of the remaining mobile operator’s contract term or the expected period of performance under the mobile operator’s contract. We do not expect revenues from NRE fees to be a substantial portion of our revenues in future periods.

Our service revenues also include revenues associated with client license fees paid to us upon the activation of our service or shipment of Danger-enabled mobile devices. We ceased charging these fees to T-Mobile USA effective June 2005 and our client license fee revenues have subsequently decreased significantly. Client license fee revenues are deferred and amortized ratably over the longer of the remaining mobile operator’s contract term, the expected period of performance under the mobile operator’s contract or in cases where the mobile operators had refund rights, the refund period. As of September 30, 2007, we had recognized all of the revenues associated with client license fees paid by T-Mobile USA. We continue to charge client license fees to certain mobile operator customers pursuant to contractual arrangements entered into prior to June 2005, but revenues associated with these client license fees have not been significant nor do we expect them to be significant in future periods.

Product Revenues.    Our product revenues are associated with the sale of Danger-enabled mobile devices by us to our mobile operator customers prior to March 2006. Product revenues from these sales are deferred and amortized over the longer of the remaining mobile operator contract term, the expected period of performance under the mobile operator’s contract or, in cases where the mobile operator has refund rights, over the duration of any refund period. Since September 2004, our OEM partners have been primarily responsible for the manufacture and sale of Danger-enabled mobile devices to our mobile operator customers and our product revenues from device sales have decreased substantially. We expect that substantially all of our deferred product revenues will be amortized by September 30, 2008. We also receive minimal fees related to device accessories sold by third parties which we classify as product revenue.

Deferred Revenues

Our arrangements with our mobile operator customers constitute a subscription model that requires our premium applications, content and services revenues to be deferred and amortized ratably over the longer of the mobile operators’ remaining contract term or the expected period of performance under the mobile operators’ contract, commencing the month after the premium applications, content and services are provided. We also defer revenues associated with client license fees, NRE fees and the sale of Danger-enabled mobile devices. Deferred revenues increase in a given period by the amount of our invoiced fees required to be deferred and decrease by the amount of our service and product revenues recognized.

In addition, when a specified deliverable is deemed present in our arrangements with a mobile operator, all revenues associated with that arrangement, including monthly service revenues, are deferred until the specified deliverable is provided. Our initial contract with T-Mobile USA contained commitments to provide specified deliverables. In the year ended September 30, 2005, we recognized $12.6 million of accumulated deferred revenues associated with product sales and fees invoiced in the years ended September 30, 2003 and 2004. These deferred revenues were recognized upon delivery of a specified deliverable to T-Mobile USA and consisted of $5.9 million of monthly service revenues, $1.0 million of client license fee revenue, $5.6 million of product revenues, $117,000 of revenues associated with NRE fees and $37,000 of premium application, content and services revenues. As of September 30, 2007, one of our contracts with a mobile operator customer contained a commitment for a specified deliverable that had yet to be provided. We currently cannot determine when the specified deliverable will be provided and, therefore, when deferred revenues associated with that arrangement can be recognized. At September 30, 2007, deferred revenues under this arrangement were not material.

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The following table reflects the amounts of service fees and product sales we billed and revenues we recognized for the years ended September 30, 2005, 2006 and 2007, and the balance of our deferred revenues at September 30 of each such year:

	Years Ended September 30,
Billed Fees and Product Sales	2005		2006		2007
	(In thousands)
Service
Monthly service	$	10,083	$	29,469	$	44,785
Premium applications, content and services		2,705		4,443		7,676
NRE		473		661		2,215
Client license		5,848		283		46
Total service		19,109		34,856		54,722
Product		2,212		449		125
Total billed fees and product sales	$	21,321	$	35,305	$	54,847
	Years Ended September 30,
Revenues	2005		2006		2007
	(In thousands)
Service
Monthly service	$	15,655	$	29,566	$	44,575
Premium applications, content and services		903		2,964		4,177
NRE		329		392		219
Client license		4,782		5,973		1,610
Total service		21,669		38,895		50,581
Product		15,121		10,416		5,832
Total revenues	$	36,790	$	49,311	$	56,413
	As of September 30,
Deferred Revenues Balance	2005		2006		2007
	(In thousands)
Service
Monthly service	$	81	$	—	$	209
Premium applications, content and services		2,371		3,859		7,358
NRE		527		781		2,779
Client license		7,332		1,632		68
Total service		10,311		6,272		10,414
Product		15,891		5,924		216
Total deferred revenues		26,202		12,196		10,630
Less current portion of deferred revenues		18,003		9,140		6,097
Long-term portion of deferred revenues	$	8,199	$	3,056	$	4,533

Cost of Revenues

The following table reflects our cost of revenues for the years ended September 30, 2005, 2006 and 2007:

	Years Ended September 30,
Cost of Revenues	2005		2006		2007
	(In thousands)
Cost of service revenues	$	10,701	$	17,755	$	26,846
Cost of product revenues		16,220		9,130		5,276
	$	26,921	$	26,885	$	32,122

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Cost of Service Revenues.    Our cost of service revenues consists primarily of personnel related costs associated with employees and contractors responsible for the design, development, and quality assurance of our service delivery engine, or SDE, and costs associated with hosting and managing our mobile data services, including personnel related costs, hosting and bandwidth charges and depreciation expense related to the operation of our data center. In addition, cost of service revenues includes costs associated with our premium applications, content and services, including third-party developer royalties and personnel related costs. Third-party developer royalties, and any other direct incremental premium applications, content and services costs are deferred, although not in amounts exceeding deferred premium applications, content and services revenues, and amortized to cost of service revenues over a period commensurate with the amortization period for the related revenues. We expect cost of service revenues to increase in absolute dollars and as a percentage of revenues in the near term as we expand and improve our data centers and as we continue to develop and enhance our SDE.

Cost of Product Revenues.    Our cost of product revenues primarily includes the cost to purchase Danger-enabled mobile devices and other costs associated with the sale of Danger-enabled mobile devices by us prior to March 2006. These, and any other, direct incremental product costs are deferred, although not in amounts exceeding deferred product revenues, and amortized to cost of product revenues over a period commensurate with the amortization period for the related revenues. As of September 30, 2007, deferred cost of product revenues was $187,000 and we expect that substantially all of our deferred cost of product revenues will be amortized by September 30, 2008.

Operating Expenses

Our operating expenses consist of research and development, sales and marketing and general and administrative expenses and are recognized when incurred. Personnel related costs are the most significant component of each of these categories and include salary, fringe benefits and allocated facilities overhead.

Research and Development.    Our research and development expenses consist primarily of the personnel related costs of employees and contractors responsible for the design, development, porting and quality assurance of our client software and costs associated with the purchase of prototype devices used to develop and test our client software. We devote substantial resources to the ongoing development and enhancement of our client software and, in order to maintain our competitive position, we intend to continue to invest significantly in research and development in future periods. We expect our research and development expenses will increase in absolute dollars as we continue to develop and enhance our client software but that research and development expenses will decline as a percentage of revenues over time.

Sales and Marketing.    Our sales and marketing expenses consist primarily of personnel related costs, costs related to marketing programs and travel costs. We expect that our sales and marketing expenses will increase in future periods in absolute dollars as we continue to seek additional mobile operator customers and increase subscribers to our mobile data services, particularly in international markets, but that sales and marketing expenses will decline as a percentage of revenues over time.

General and Administrative.    Our general and administrative expenses consist primarily of personnel related costs related to our executive, finance, legal, human resource and information technology organizations and fees for professional services. We expect that our general and administrative expenses will increase in absolute dollars and as a percentage of revenue in the near term as we add personnel and incur costs to support the growth in our business, including our efforts to expand internationally and manage our operations as a public company, including compliance with the Sarbanes-Oxley Act of 2002 and related regulations.

Other Income (Expense), Net

Other income (expense), net includes interest income, interest expense, changes in the fair value of our preferred warrant liability as required under FASB Staff Position No. 150-5, Issuer’s Accounting under FASB

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Statement No. 150 for Freestanding Warrants and Other Similar Instruments on Shares that are Redeemable, or FSP 150-5, and foreign currency transaction gains and losses. As a result of the additional cash and cash equivalents resulting from the net proceeds of this offering, we expect our interest income to increase. Upon the conversion of our redeemable convertible preferred stock in conjunction with the completion of this offering, our preferred warrant liability will be reclassified to stockholders’ deficit, and we will no longer be required to record changes in our preferred warrant liability under FSP 150-5.

Provision for Income Taxes

Since inception, we have incurred annual operating losses. Our provision for income taxes is comprised of foreign taxes recognized for our subsidiary in the United Kingdom. No Federal or state income taxes have been recognized to date due to losses incurred in all U.S. tax jurisdictions.

Due to uncertainty surrounding the realization of deferred tax assets through future taxable income, we have provided a full valuation allowance and no current benefit has been recognized for the net operating loss and other deferred tax assets. Accordingly, deferred tax asset valuation allowances have been established as of September 30, 2006 and 2007 to reflect these uncertainties. Federal and state net operating loss carryforwards begin to expire in 2020 and 2007, respectively, unless these net operating losses are utilized. At September 30, 2007, the balance of our Federal net operating loss carryforwards was $110.0 million. Our ability to use our net operating loss carryforwards to offset any future taxable income may be subject to restrictions attributable to equity transactions that result in changes in ownership as defined by section 382 of the Internal Revenue Code of 1986, as amended.

Accretion of Redemption Value on Redeemable Convertible Preferred Stock

Our redeemable convertible preferred stock has a mandatory redemption provision of approximately $255.2 million as of September 30, 2007. In each reporting period, we accrete the amount that is necessary to adjust the recorded balance of our outstanding redeemable convertible preferred stock to an amount equal to its redemption price over the redemption period. Upon the conversion of our outstanding redeemable convertible preferred stock at the closing of this offering we will cease this accretion.

Critical Accounting Policies and Significant Estimates

Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Although we believe that our estimates and judgments are reasonable under the circumstances existing at the time these estimates are made, actual results may differ from those estimates, which could affect our consolidated financial statements.

Our critical accounting policies and estimates have been reviewed and discussed with our audit committee. Critical accounting policies are those that are both important to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. As the number of variables and assumptions affecting the possible future resolution of these uncertainties increases, those judgments become even more subjective and complex. In order to provide an understanding about how our management forms its judgments about future events, including the variables and assumptions underlying the estimates and the sensitivity of those judgments to different circumstances, we have identified the following as our critical accounting policies:

• revenue recognition; and

• stock-based compensation.

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Revenue Recognition

Under our software-as-a-service business model, we enter into service contracts with mobile operators and generate revenues primarily from the following sources:

• monthly service fees for each of our mobile operator customer’s subscribers that can access our mobile data services;

• premium applications, content and services fees charged as a one-time fee or a monthly subscription fee, derived from downloads of games, productivity applications, networked services, ringtones and background themes; and

• NRE fees related to the initial deployment of the Danger solution with a mobile operator and custom development projects for our mobile operator customers.

We recognize revenues in accordance with accounting standards for software and service companies, including American Institute of Certified Public Accountants, or AICPA, Statement of Position, or SOP, No. 97-2, Software Revenue Recognition, or SOP 97-2, as amended by SOP 98-9, the consensus reached in Emerging Issues Task Force, or EITF, Issue No. 03-5, Applicability of AICPA Statement of Position 97-2 to Non-Software Deliverables in an Arrangement Containing More-Than-Incidental Software, or EITF 03-5, and related interpretations, including AICPA Technical Practice Aids, or TPAs.

Our client software, which is provided to our OEM partners on a royalty-free basis, is embedded in Danger-enabled mobile devices. Our OEM partners sell the Danger-enabled mobile devices directly to our mobile operator customers. Therefore, we account for our client software as an element in our arrangements with the mobile operator customers. Since our client software is more than incidental to the arrangement, we recognize revenue in accordance with SOP 97-2.

We evaluate whether our mobile data services are essential to the functionality of any other elements under the arrangements, including our client software embedded in Danger-enabled mobile devices. We provide a fully integrated solution, in which a mobile operator’s subscribers must purchase a Danger-enabled mobile device in order to obtain access to our mobile data services. Accessing our mobile data services is essential to allow the mobile operator’s subscribers to have full use of Danger-enabled mobile devices as they would not have full functionality without our mobile data services. However, contract accounting is not required because the client software is fully functional upon delivery, as it allows the mobile operator’s subscribers to gain access to our mobile data services upon delivery without significant modifications or additions to the client software.

Premium applications, content and services fees are earned based upon applying a constant multiplier, which varies based on the type of premium application, content or service, to the number of successful downloads. Our customers’ subscribers may also subscribe to network-aware premium applications, content and services, for which we charge monthly subscription fees. Premium applications, content and services fees are billed to the mobile operators on a monthly basis. As premium applications, content and services are offered to the mobile operators as an option to purchase unlimited future software products at a predetermined price and we do not have vendor specific objective evidence, or VSOE, of fair value nor do we offer a comparable discount for premium applications, content and services, in accordance with TPA, 5100.50, Definition of More-Than-Insignificant Discount and Software Revenue Recognition, and TPA 5100.51, Accounting for Significant Incremental Discounts on Future Purchases, a significant incremental discount on premium applications, content and services is deemed existent in our arrangements. Since future purchases of premium applications, content and services are not limited by quantity, this significant incremental discount effectively creates a subscription model for other elements in our arrangements with our mobile operator customers. Therefore, premium applications, content and services revenues are deferred and amortized ratably over the longer of the remaining mobile operator’s contract term or the expected period of performance under the mobile operator’s contract, commencing the month after the premium applications, content and services are provided. Any direct incremental premium applications, content and services costs are also deferred and amortized over the same

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period, although not in amounts exceeding the premium applications, content and services revenues that are deferred. Premium applications, content and services revenues and costs are recorded as service revenues and cost of service revenues, respectively, on our consolidated statements of operations.

Revenues associated with NRE fees related to the initial deployment of the Danger solution with a mobile operator and to custom development projects are also accounted for under the subscription model as a result of the presence of the significant incremental discount on premium applications, content and services. Therefore, these revenues are deferred and amortized ratably over the longer of the applicable mobile operator’s remaining contract term or the expected period of performance under the mobile operator’s contract, commencing the month after our mobile data services are first launched with the mobile operator or when the applicable mobile operator accepts the custom development project. Any associated direct incremental costs are also deferred, although not in amounts exceeding the deferred revenues associated with NRE fees, and amortized over the same period. Revenues and costs associated with NRE fees are recorded as service revenues and cost of service revenues, respectively, on our consolidated statements of operations.

Monthly service fees under our arrangements with mobile operators are earned based on the number of days that our customers’ subscribers are able to use our service, and are billed to the mobile operator on a monthly basis. Post-contract customer support services are provided to the mobile operators at no additional charge throughout the contract term. We recognize revenue based on the guidance in TPA 5100.76, Fair Value in Multiple-Element Arrangements That Include Contingent Usage-Based Fees and Software Revenue Recognition. Our monthly service fees are analogous to the contingent usage-based fees under TPA 5100.76. The TPA 5100.76 accounting model is considered a subscription model for usage based revenues. Therefore, we recognize revenues on the monthly service fees as the fee becomes fixed or determinable at the time actual usage occurs and collectibility is probable. This occurs at the end of each month when we have a reliable measure of usage. At that time, we have also satisfied the other revenue recognition criteria contained in SOP 97-2 as we have persuasive evidence that an arrangement exists, services have been rendered, the price is fixed or determinable, and collectibility is reasonably assured. Monthly service revenues and costs are recorded as service revenues and cost of service revenues, respectively, on our consolidated statements of operations.

When a specified deliverable is deemed present in an arrangement with a mobile operator and we do not have VSOE of fair value of this specified deliverable, we defer the recognition of all revenues under the particular arrangement until the commitment to provide the specified deliverable is fulfilled. We deferred all of our revenues generated from our arrangement with T-Mobile USA during the years ended September 30, 2003 and 2004, and recognized these cumulative deferred revenues during the year ended September 30, 2005 upon the fulfillment of our commitment to provide certain specified deliverables under our arrangement with T-Mobile USA.

In addition to the aforementioned revenue sources, we sold Danger-enabled mobile devices to certain of our mobile operator customers until March 2006. We also charged client license fees upon device shipment or activation to our mobile operator customers prior to June 2005, and we still charge client license fees to certain of our mobile operator customers that account for a relatively small number of subscribers that access our mobile data services. Revenues associated with the sale of Danger-enabled mobile devices and client license fees are deferred and amortized to revenue ratably over the longer of the remaining contract term, the expected period of performance under the mobile operator’s contract or, in cases where the mobile operator had refund rights, over the duration of any refund period. Any direct incremental costs, although not in amounts exceeding associated deferred revenues, are deferred and amortized over the same period. Product sales and costs are recorded as product revenues and cost of product revenues, respectively, on our consolidated statements of operations. Client license fee revenues and costs are recorded as service revenues and costs of service revenues, respectively, on our consolidated statements of operations.

Stock-Based Compensation

Prior to October 1, 2006, as permitted by Statement of Financial Accounting, or SFAS, No. 123, Accounting for Stock-Based Compensation, or SFAS 123, and SFAS No. 148, Accounting for Stock-Based Compensation-

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Transition and Disclosure, or SFAS 148, we accounted for stock-based employee compensation using the intrinsic method of accounting under Accounting Principles Board, or APB Opinion No. 25, Accounting for Stock Issued to Employees, or APB 25, and presented disclosure of pro forma information as required under SFAS 123, as amended by SFAS 148. Under APB 25, no compensation expense was recognized unless the exercise price was less than the estimated fair market value at the date of grant. All option grants made prior to September 30, 2006 were made at fair market value, as determined by our board of directors, and consequently no stock-based employee compensation expense was reflected in our consolidated statements of operations for the years ended September 30, 2005 and 2006.

Effective October 1, 2006, we began accounting for share-based awards under the provisions of SFAS No. 123(R), Share-Based Payment, or SFAS 123(R), which requires compensation expense related to share-based transactions, including employee stock options, to be measured and recognized in the financials statements based on fair value. SFAS 123(R) requires us to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The fair value of that portion of the share-based awards expected to vest is recognized as expense ratably over the requisite service period of the award.

We adopted SFAS 123(R) using the prospective method which requires the application of the accounting standard as of October 1, 2006. Our consolidated financial statements as of and for year ended September 30, 2007 reflect the impact of SFAS 123(R). In accordance with the prospective method, our consolidated financial statements for prior periods have not been restated to reflect, and do not include, the impact of SFAS 123(R). We use the straight-line method to allocate compensation cost to reporting periods under SFAS 123(R).

As a result of adopting SFAS 123(R) on October 1, 2006, our loss before provision for income taxes and cumulative effect of change in accounting principle and net loss for the year ended September 30, 2007 is $329,000 higher than if we had continued to account for stock-based compensation under APB 25. Diluted net loss per share for the year ended September 30, 2007 is $0.02 higher than if we had continued to account for stock-based compensation under APB 25. There was no compensation cost capitalized as part of an asset in the year ended September 30, 2007. We have not recognized, and we do not expect to recognize in the near future, any tax benefit related to employee stock-based compensation cost as a result of the full valuation allowance on our net deferred tax assets and our net operating loss carryforwards.

As of September 30, 2007, we had $3.8 million of unrecognized stock-based compensation expense remaining to be amortized over a period of 3.7 years.

For the year ended September 30, 2007, we estimated the fair value of each option award under SFAS 123(R) on the date of grant using the Black-Scholes-Merton, or Black-Scholes, option-pricing model utilizing the following assumptions:

Estimated volatility	59.4	%
Expected dividend yield	0.0	%
Expected life (years)	5.3
Weighted average risk-free interest rate	5.0	%

The weighted average grant date fair value per share of employee stock options granted during the year ended September 30, 2007 was $0.31.

Estimated volatility.    Since our adoption of SFAS 123(R), we have calculated estimated volatility based upon the trading history and implied volatility of the common stock of comparable technology companies. Comparable companies include other public companies in the technology industry similar in size, stage of development and financial leverage.

Expected dividend yield.    We have not declared or paid any cash dividends and do not presently plan to pay cash dividends in the foreseeable future. Therefore, we use an expected dividend yield of zero.

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Expected life.    The expected life of share-based awards represents the period that share-based awards are expected to be outstanding. Upon our adoption of SFAS 123(R) on October 1, 2006, as permitted by Staff Accounting Bulletin No. 107, Share Based Payment, we adopted a temporary “shortcut approach” to estimate the expected life of employee stock options through March 31, 2007. Under this approach, the expected life is presumed to be the mid-point between the vesting date and the contractual end of the option. Since April 1, 2007, we have estimated the expected life of employee stock options based on the expected terms of options granted by publicly-traded comparable companies and our historical exercise experience.

Weighted average risk-free interest rate.    We base the weighted average risk-free interest rate on the implied yield currently available on U.S. Treasury constant maturity securities with the same or substantially equivalent remaining term as our stock options.

Estimated forfeitures.    SFAS 123(R) requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. When estimating forfeitures, we consider voluntary and involuntary termination behavior as well as analysis of actual option forfeitures.

The determination of fair value of stock-based compensation involves significant judgments, assumptions, estimates and complexities. The assumptions discussed above represent management’s best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, if other assumptions had been used, the recorded stock-based compensation expense could have been materially different.

The following table summarizes information concerning all options granted during the period from October 1, 2006 through September 30, 2007:

Grant Date	Number of Options Granted	Option Exercise Price		Fair Value of Common Stock on Grant Date
October 2006	585,000	$	0.37	$	0.37
December 2006	442,200		0.37		0.37
March 2007	403,000		0.55		0.55
June 2007	11,987,500		0.55		0.55
September 2007	1,872,500		0.65		0.65

At each of these dates, our board of directors determined the value of our common stock on the basis of the most recent contemporaneous valuation presented by management, as updated since the date of such valuation to account for developments in our business, and the additional factors summarized below.

Valuation of Common Stock.    We have historically granted stock options at exercise prices not less than the fair value of our common stock. Given the absence of an active market for our common stock, our board of directors, the members of which have extensive business, finance and venture capital experience, estimated the fair value of our common stock at each grant date, based in part on an analysis of factors including:

• the price of our redeemable convertible preferred stock sales in arms-length transactions, and the rights, preferences and privileges, including liquidation value, of our redeemable convertible preferred stock and our common stock;

• the introduction of new mobile data services and Danger-enabled mobile devices;

• our entry into mobile operator and OEM agreements;

• our current and expected future operating and financial performance;

• the marketability of our equity securities;

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• the market multiples of publicly-held technology companies with similar business models and similar financial results;

• comparable merger and acquisitions of technology companies with similar business models and similar financial results;

• the likelihood of achieving a liquidity event for the shares of common stock underlying the stock options, such as an initial public offering, or a sale of our company, given the prevailing market conditions and our relative financial condition at the time of grant; and

• in-depth contemporaneous valuations as of September 8, 2006, February 7, 2007, June 1, 2007 and August 31, 2007 presented by management.

Each of the contemporaneous valuations presented by management to the board of directors used a two-step process for determining the fair value of the common stock in which our aggregate business enterprise value was first estimated and subsequently allocated to each class of our outstanding stock. Our aggregate business enterprise value at each valuation date was determined using a market multiple method and a comparable transaction method, each of which was weighted equally. The aggregate enterprise value was allocated to our common stock on a per-share basis at each valuation date using an option-pricing methodology that included a probability weighted scenario analysis. This two-step approach is consistent with the methods outlined in the AICPA Practice Aid, Valuation of Privately-Held-Company Equity Securities Issued as Compensation.

The market multiple method estimated aggregate enterprise value by applying risk adjusted revenue multiples of publicly traded companies in similar lines of business and similar financial results to our revenues. Significant estimates used in the market multiple approach included the selection of comparable companies, market multiples and the relative weighting of the different market multiples. The comparable transaction approach to determining aggregate enterprise value involved the identification of similar transactions, such as mergers and acquisitions, for companies in similar lines of business and with similar financial results. Risk adjusted revenue multiples were then applied to the revenues of those companies in much the same manner as the market multiple method. In both instances, comparable companies included mobile content providers, software-as-a-service companies, and high technology communications and entertainment companies that were selected based on various factors, including, but not limited to, industry, product offering, growth and future growth expectations, financial risk, market position and company size.

The aggregate business enterprise value determined through the methods described above was allocated to each class of our capital stock using an option-pricing methodology that included a probability weighted scenario analysis of four potential liquidity scenarios, one of which involved the completion of an initial public offering and three of which involved the sale of the company at various values. For purposes of the liquidity scenarios involving the sale of the company, a value was first assigned to each share of redeemable convertible preferred stock and the remaining equity securities were analyzed as an option on some portion of the remaining business enterprise value. In undertaking this analysis, the rights and privileges of each class of capital stock were considered, including such factors as liquidation rights, conversion rights, and the manner in which each class of capital stock affects the other. In each of these scenarios, a large proportion of our aggregate business enterprise value was allocated to our redeemable convertible preferred stock because of the significant liquidation preferences associated with the outstanding redeemable convertible preferred stock and the rights of certain series of our outstanding redeemable convertible preferred stock to participate with the common stock after payment of the liquidation preferences. For purposes of the liquidity scenario involving an initial public offering, options and warrants were valued based solely on the Black-Scholes option-pricing model. The aggregate value related to options and warrants was subtracted from the aggregate business enterprise value for purposes of determining the redeemable convertible preferred stock and common stock values on an as-if converted, per share basis. After accounting for the value of the options and warrants, the remaining business enterprise value was apportioned equally among the shares of common stock and each series of redeemable convertible preferred stock, which resulted in the common stock having a higher relative value per share than under the other liquidity scenarios.

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The anticipated timing of a potential liquidity event, the estimated volatility, the discount for lack of marketability and the probability of an initial public offering were the key assumptions used in the determination of the common stock value per share in connection with each valuation. These assumptions are set forth below for each of the contemporaneous valuations presented by management since September 8, 2006:

	Sep. 8, 2006			Feb. 7, 2007			June 1, 2007			Aug. 31, 2007
Common stock value per share	$	0.37		$	0.55		$	0.55		$	0.65
Risk-free interest rate		4.8	%		5.1	%		5.1	%		4.2	%
Time to liquidity event (in years)		1.8			1.3			1.3			0.6
Estimated volatility		68.0	%		60.0	%		60.0	%		60.0	%
Marketability discount rate		17.5	%		12.5	%		12.5	%		6.3	%
Probability of an initial public offering		20.0	%		40.0	%		40.0	%		60.0	%

October 2006 Grants.    The contemporaneous valuation presented by management as of September 8, 2006 determined the fair value of our common stock to be between $0.36 and $0.38 per share. For purposes of the October 2006 grants, our board of directors determined, in light of all relevant facts and circumstances, that the fair value of our common stock was $0.37 per share. In addition to the contemporaneous valuation, significant factors considered by our board of directors in determining the fair value of our common stock included the following:

• growth in our revenues;

• increases in the trading multiples of comparable companies and value of comparable sale transactions;

• the execution of a new contract with T-Mobile USA in March 2006;

• the execution of a product development and distribution agreement with Motorola;

• the negotiation and execution of a term sheet for the purchase of our Series E redeemable convertible preferred stock by Sharp; and

• ongoing developments associated with certain intellectual property litigation.

December 2006 Grants.    The contemporaneous valuation presented by management as of September 8, 2006 determined the fair value of our common stock to be between $0.36 and $0.38 per share. For purposes of the December 2006 grants, our board of directors determined that the fair value of our common stock remained $0.37 per share due to the absence of material events in the interim period that would increase our aggregate business enterprise value.

March 2007 Grants.    The contemporaneous valuation presented by management as of February 7, 2007 determined the fair value of our common stock to be between $0.54 and $0.57 per share. For purposes of the March 2007 grants, our board of directors determined, in light of all relevant facts and circumstances, that the fair value of our common stock was $0.55 per share. In addition to the contemporaneous valuation, significant factors considered by our board of directors in determining the fair value of our common stock included the following:

• growth in our revenues and the launch of our mobile data services with a new mobile operator customer;

• increases in the trading multiples of comparable companies and the values of comparable sale transactions; and

• our commencement of discussions with certain investment banks about an initial public offering of our common stock.

June 2007 Grants.    The contemporaneous valuation presented by management as of June 1, 2007 determined the fair value of our common stock to be between $0.51 and $0.54 per share. For purposes of the June

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2007 grants, our board of directors determined, in light of all relevant facts and circumstances, that the fair value of our common stock was $0.55 per share. In addition to the contemporaneous valuation, significant factors considered by our board of directors in determining the fair value of our common stock included the following:

• sales results associated with the launch of a new Danger-enabled mobile device;

• the anticipated launch of certain competitive devices, particularly Apple, Inc.’s iPhone; and

• relative stability in the trading multiples of comparable companies and the values of comparable sale transactions.

September 2007 Grants.    The contemporaneous valuation presented by management as of August 31, 2007 determined the fair value of our common stock to be between $0.64 and $0.66 per share. For purposes of the September 2007 grants, our board of directors determined, in light of all relevant facts and circumstances, that the fair value of our common stock was $0.65 per share. In addition to the contemporaneous valuation, significant factors considered by our board of directors in determining the fair value of our common stock included the following:

• growth in our revenues;

• our selection of investment bankers and our decision to pursue an initial public offering; and

• relative stability in the trading multiples of comparable companies and value of comparable sale transactions.

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Results of Operations

The following table is derived from our consolidated statements of operations and sets forth our historical operating results as a percentage of total revenues for the years ended September 30, 2005, 2006 and 2007:

	Years Ended September 30,
	2005		2006		2007
Consolidated Statements of Operations Data:
Revenues:
Service	58.9	%	78.9	%	89.7	%
Product	41.1		21.1		10.3
Total revenues	100.0		100.0		100.0
Cost of revenues:
Cost of service revenues	29.1		36.0		47.6
Cost of product revenues	44.1		18.5		9.3
Total cost of revenues	73.2		54.5		56.9
Gross margin	26.8		45.5		43.1
Operating expenses:
Research and development	30.7		36.0		39.9
Sales and marketing	14.2		11.6		12.4
General and administrative	9.8		14.2		11.6
Total operating expenses	54.7		61.8		63.9
Loss from operations	(27.9	)	(16.3	)	(20.8	)
Other income (expense), net	1.0		0.2		(1.0	)
Loss before provision for income taxes and cumulative effect of change in accounting principle	(26.9	)	(16.1	)	(21.8	)
Provision for income taxes	—		(0.1	)	(0.1	)
Loss before cumulative effect of change in accounting principle	(26.9	)	(16.2	)	(21.9	)
Cumulative effect of change in accounting principle	—		2.9		—
Net loss	(26.9	)	(13.3	)	(21.9	)
Accretion of redemption value on redeemable convertible preferred stock	(33.5	)	(29.4	)	(27.9	)
Net loss attributable to common stockholders	(60.4	)%	(42.7	)%	(49.8	)%

Comparison of Years Ended September 30, 2006 and 2007

Revenues

The following sets forth our service and product revenues and the related increase (decrease) in such revenues on an absolute and percentage basis for the years ended September 30, 2006 and 2007:

	Years Ended September 30,				Change
	2006		2007		$			%
	(Dollars in thousands)
Service revenues	$	38,895	$	50,581	$	11,686		30.0	%
Product revenues		10,416		5,832		(4,584	)	(44.0	)
Total revenues	$	49,311	$	56,413	$	7,102		14.4

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The increase in service revenues in the year ended September 30, 2007 was primarily due to an increase of $15.0 million in monthly service revenues from $29.6 million in the year ended September 30, 2006 to $44.6 million in the year ended September 30, 2007. The increase in monthly service revenues was associated with growth in the number of our customers’ subscribers that had access to our mobile data services. Premium applications, content and services revenues increased $1.2 million to $4.2 million in the year ended September 30, 2007 from $3.0 million in the year ended September 30, 2006. We invoiced $7.7 million of premium applications, content and services fees in the year ended September 30, 2007, and those fees will be recognized as revenue over an average of 21 months. Increases in monthly service revenues and premium applications, content and services revenues were offset by a decrease of $4.4 million in client license fee revenues and a decrease of $173,000 in revenues associated with NRE fees in the year ended September 30, 2007. We expect to recognize, in decreasing amounts, substantially all remaining client license fee revenues by September 30, 2008.

The decrease in product revenues in the year ended September 30, 2007 was due to a decrease in amortization of deferred product revenues associated with the sale of Danger-enabled mobile devices prior to March 2006. We expect to recognize, in decreasing amounts, substantially all remaining product revenues by September 30, 2008.

Cost of Revenues and Gross Profit

The following sets forth our cost of revenues and gross profit and related increase (decrease) in cost of revenues and gross profit on an absolute and percentage basis for the years ended September 30, 2006 and 2007:

	Years Ended September 30,				Change
	2006		2007		$			%
	(Dollars in thousands)
Cost of service revenues	$	17,755	$	26,846	$	9,091		51.2	%
Cost of product revenues		9,130		5,276		(3,854	)	(42.2	)
Total cost of revenues	$	26,885	$	32,122	$	5,237		19.5
Gross profit—service	$	21,140	$	23,735	$	2,595		12.3
Gross profit—product		1,286		556		(730	)	(56.8	)
Total gross profit	$	22,426	$	24,291	$	1,865		8.3

The increase in cost of service revenues in the year ended September 30, 2007 was primarily due to an increase of $4.2 million in personnel related costs associated with increased headcount in our service engineering, network operations and premium services organizations. In addition, hosting and bandwidth charges increased $2.0 million in the year ended September 30, 2007 as a result of growth in the number of our customers’ subscribers that had access to our mobile data services and the full annual impact of expenses associated with a data center colocation facility in Europe that we began to incur in the second quarter of the year ended September 30, 2006. Depreciation increased $2.0 million in the year ended September 30, 2007 as a result of ongoing data center capital expenditures, including the expansion of our data center in San Jose, California. Amortization of third-party developer royalties increased approximately $817,000, in the year ended September 30, 2007, in connection with the increase in premium applications, content and services revenues.

The decrease in cost of product revenues in the year ended September 30, 2007 was due to a decrease in the amortization of deferred product costs of $4.2 million associated with the sale of Danger-enabled mobile devices prior to March 2006. We expect to recognize, in a decreasing amount, substantially all remaining deferred product costs by September 30, 2008. In addition, in September 2006, we reduced our cost of product revenues by $1.4 million as a one-time adjustment of our accrual for estimated settlement costs related to certain patent and trade secret litigation to reflect a reduction in such estimated costs.

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For the year ended September 30, 2007, our gross profit increased $1.9 million and our gross margin decreased to 43.1% from 45.5% in the year ended September 30, 2006. Our gross profit and gross margin are significantly influenced by the relative mix of our revenues between service revenues and product revenues as well as the relative mix of our various service revenues. The gross margins associated with our monthly service revenues and premium applications, content and services revenues are substantially higher than gross profit associated with the sale of Danger-enabled mobile devices to our mobile operator customers. As a result, the decrease in product revenues and related costs associated with the termination of our sales of Danger-enabled mobile devices has had and will continue to have a positive impact on our gross margin through the year ended September 30, 2008. The gross margins associated with our monthly service revenues have higher gross margins than our other service revenues, including our premium applications, content and services revenues. Gross margin associated with our service revenues decreased from 54.4% in the year ended September 30, 2006 to 46.9% in the year ended September 30, 2007 due an increase in premium applications, content and services revenues relative to other service revenues. Gross margins associated with product revenues decreased from 12.3% in the year ended September 30, 2006 to 9.5% in the year ended September 30, 2007 due to our one-time adjustment of estimated costs related to certain patent and trade secret litigation in the year ended September 30, 2006.

In addition, our gross profits and gross margins have been and will continue to be affected by a variety of factors, including:

• the timing of new product introductions;

• costs associated with the development of new or expansion of or improvements to existing data centers;

• costs associated with licensing in technology for the development of enhanced features for our mobile data services;

• the existence of commitments to provide specified deliverables that result in revenue deferral;

• pricing changes;

• the period over which our premium applications, content and services revenues are recognized; and

• software warranty costs and indemnification obligations associated with our mobile operator customer and OEM relationships.

Operating Expenses

The following sets forth our operating expenses and the related increase (decrease) in such expenses on an absolute and percentage basis for the years ended September 30, 2006 and 2007:

	Years Ended September 30,				Change
	2006		2007		$			%
	(Dollars in thousands)
Research and development	$	17,746	$	22,497	$	4,751		26.8	%
Sales and marketing		5,723		7,020		1,297		22.7
General and administrative		6,999		6,541		(458	)	(6.5	)
Total operating expenses	$	30,468	$	36,058	$	5,590		18.3

Research and Development.    The increase in research and development expense in the year ended September 30, 2007 was primarily due to an increase of $5.1 million in personnel related costs associated with increased headcount and an increase of $818,000 in consulting expenses to design, develop and test our client software. The increase in headcount was necessitated by our entry into an OEM arrangement with Motorola in September 2006, and the development of our client software to support multiple Danger-enabled mobile devices sold by Sharp in the year ended September 30, 2007. Research and development expenses in the year ended September 30, 2006 also included a one-time charge of $982,000 associated with the vested portion of a warrant to purchase our Series D’ redeemable convertible preferred stock issued to Motorola in connection with our OEM arrangement.

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Sales and Marketing.    The increase in sales and marketing expense in the year ended September 30, 2007 was primarily due to a $1.1 million increase in personnel related costs, including costs associated with the expansion of our sales force outside the United States.

General and Administrative.    The decrease in general and administrative expense in the year ended September 30, 2007 was primarily due to a decrease of approximately $2.2 million in legal fees and other costs associated with certain patent and trade secret litigation settled in November 2006. The decrease in legal expenses was partially offset by an increase of $1.1 million in personnel related costs associated with increased headcount and $838,000 in professional fees to support company growth and our preparations to become a public company.

Other Income (Expense), Net.

The following sets forth our other income (expense), net and the related increase (decrease) in other income (expense), net on an absolute basis for the years ended September 30, 2006 and 2007:

	Years Ended September 30,					Change
	2006		2007			$
	(In thousands)
Other income (expense), net	$	107	$	(520	)	$	(627	)

The change in other income (expense), net is primarily due to an increase in interest expense of $352,000, which was attributable to higher average debt balances during the year ended September 30, 2007, lower interest income of $136,000, which resulted from lower average cash balances, partially offset by higher average interest rates in the year ended September 30, 2007, and an increase of $110,000 in the charge associated with the measurement of our preferred warrant liability to fair value. Preferred warrants are recorded at fair value each period using the Black-Scholes option-pricing model and the change is recorded in other income (expense), net. The increase in the fair value resulted from an increase in the fair market value of the underlying redeemable convertible preferred stock, partially offset by a decrease in the volatility and remaining terms of the warrants.

Comparison of Years Ended September 30, 2005 and 2006

Revenues

The following sets forth our service and product revenues and the related increase (decrease) in such revenues on an absolute and percentage basis for the years ended September 30, 2005 and 2006:

	Years Ended September 30,				Change
	2005		2006		$			%
	(Dollars in thousands)
Service revenues	$	21,669	$	38,895	$	17,226		79.5	%
Product revenues		15,121		10,416		(4,705	)	(31.1	)
Total revenues	$	36,790	$	49,311	$	12,521		34.0

The increase in service revenues in the year ended September 30, 2006 was primarily due to an increase of $13.9 million in monthly service revenues from $15.7 million in the year ended September 30, 2005 to $29.6 million in the year ended September 30, 2006. The increase in monthly service revenues was associated with growth in the number of our customers’ subscribers that had access to our mobile data services and the full annual effect of an increase in the per subscriber monthly service fee charged to T-Mobile USA which became effective in June 2005. Premium applications, content and services revenues increased $2.1 million to $3.0 million in the year ended September 30, 2006 from $903,000 in the year ended September 30, 2005. We invoiced

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$4.4 million of premium applications, content and services fees in the year ended September 30, 2006, and those fees will be recognized as revenue over an average of 25 months. Client license fee revenues increased by $1.2 million in the year ended September 30, 2006, because the period over which we amortized our deferred client license fee revenues decreased relative to amortization period applicable in the year ended September 30, 2005. The change in the amortization period for the year ended September 30, 2006 resulted from the shift in manufacturing responsibility for Danger-enabled mobile devices to our OEM partner which eliminated our refund obligations associated with such devices. Revenues associated with NRE fees increased $63,000 in the year ended September 30, 2006.

The decrease in product revenues in the year ended September 30, 2006 was due to a decrease in amortization of deferred product revenues associated with the sale of Danger-enabled mobile devices, our sales of which substantially decreased following the commencement of sales by our OEM partner, Sharp, in September 2004.

In addition, in the year ended September 30, 2005, we recognized $12.6 million of accumulated deferred revenues associated with product sales and service fees invoiced in the years ended September 30, 2003 and 2004. These deferred revenues were recognized upon delivery of specified deliverables to T-Mobile USA and consisted of $5.9 million of monthly service revenues, $1.0 million of client license fee revenues, $5.6 million of product revenues, $117,000 of revenues associated with NRE fees and $37,000 of premium applications, content and services revenues.

Cost of Revenues and Gross Profit (Loss)

The following sets forth our cost of revenues and gross profit (loss) and related increase (decrease) in cost of revenues and gross profit (loss) on an absolute and percentage basis for the years ended September 30, 2005 and 2006:

	Years Ended September 30,					Change
	2005			2006		$			%
	(Dollars in thousands)
Cost of service revenues	$	10,701		$	17,755	$	7,054		65.9	%
Cost of product revenues		16,220			9,130		(7,090	)	(43.7	)
Total cost of revenues	$	26,921		$	26,885	$	(36	)	(0.1	)
Gross profit—service	$	10,968		$	21,140	$	10,172		92.7
Gross profit (loss)—product		(1,099	)		1,286		2,385		NM
Total gross profit	$	9,869		$	22,426	$	12,557		127.2

The increase in cost of service revenues in the year ended September 30, 2006 was primarily due to an increase of approximately $3.3 million in personnel related costs associated with increased headcount in our service engineering, network operations and premium services organizations. In addition, hosting and bandwidth charges increased by $906,000 in the year ended September 30, 2006 as a result of growth in the number of our customers’ subscribers that had access to our mobile data services and our expenses associated with a data center colocation facility in Europe that we began to incur in the second quarter of the year ended September 30, 2006. Depreciation increased by $1.0 million in the year ended September 30, 2006 as a result of ongoing data center capital expenditures, including the expansion of our data center in San Jose, California. Amortization of third-party developer royalties increased by approximately $1.2 million in the year ended September 30, 2006 in connection with the increase in premium applications, content and services revenues.

The decrease in cost of product revenues in the year ended September 30, 2006 was due to a decrease in the amortization of deferred product costs associated with the sale of Danger-enabled mobile devices. In addition, in

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September 2006, we adjusted our deferred cost of product revenues by $1.4 million as a one-time adjustment of our accrual for estimated settlement costs related to certain patent and trade secret litigation to reflect a reduction in such estimated costs.

For the year ended September 30, 2006, our gross profit increased $12.6 million and our profit margin increased to 45.5% from 26.8% in the year ended September 30, 2005. The increase in gross profit associated with services revenue of $10.2 million in the year ended September 30, 2006 was primarily the result of increases in our monthly service revenues of $13.9 million and client license fee revenues of $1.2 million, each of which have higher gross margins than other components of our service revenues. The increase in gross profit and gross margin associated with product revenues in the year ended September 30, 2006 was primarily the result of a one-time adjustment to reflect reduced estimated settlement costs related to certain patent and trade secret litigation and decreases in device warranty expenses and other product related costs associated with the decrease in our sales of Danger-enabled mobile devices as our OEM partners increasingly became responsible for such sales.

Operating Expenses

The following sets forth our operating expenses and the related increase in such expenses on an absolute and percentage basis for the years ended September 30, 2005 and 2006:

	Years Ended September 30,				Change
	2005		2006		$		%
	(Dollars in thousands)
Research and development	$	11,317	$	17,746	$	6,429	56.8	%
Sales and marketing		5,211		5,723		512	9.8
General and administrative		3,610		6,999		3,389	93.9
Total operating expenses	$	20,138	$	30,468	$	10,330	51.3

Research and Development.    The increase in research and development expense in the year ended September 30, 2006 was primarily due to an increase of $4.2 million in personnel related costs associated with increased headcount and an increase of $855,000 in consulting expenses to design, develop and test our client software. The increase in headcount was necessitated by the launch of a new Danger-enabled mobile device in July 2006 and preparations for and in connection with our entry into an OEM arrangement with Motorola in September 2006. Research and development expenses in the year ended September 30, 2006 also included a one-time charge of $982,000 associated with the vested portion of a warrant to purchase our Series D’ redeemable convertible preferred stock issued to Motorola in connection with our OEM arrangement.

Sales and Marketing.    The increase in sales and marketing expense in the year ended September 30, 2006 was primarily due to an increase in personnel related costs and increased spending on marketing programs associated with the launch of new mobile operator customers in Europe.

General and Administrative.    The increase in general and administrative expense in the year ended September 30, 2006 was primarily due to an increase of approximately $2.4 million in legal fees and other costs associated with certain patent and trade secret litigation. In addition, personnel related costs increased $848,000 associated with headcount necessary to support our growth.

Other Income (Expense), Net.

The following sets forth our other income (expense), net and the related increase (decrease) in such other income (expense), net on an absolute and percentage basis for the years ended September 30, 2005 and 2006:

	Years Ended September 30,				Change
	2005		2006		$			%
	(Dollars in thousands)
Other income (expense), net	$	359	$	107	$	(252	)	(70.2	)%

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The change in other income (expense), net in the year ended September 30, 2006, as compared with the year ended September 30, 2005, was primarily a result of a $907,000 charge associated with the measurement of our preferred warrant liability to fair value in the year ended September 30, 2006, partially offset by a $572,000 increase in interest income resulting from higher cash balances during the year ended September 30, 2006 as compared to the year ended September 30, 2005. The increase in fair value resulted from an increase in the fair market value of the underlying redeemable convertible preferred stock, partially offset by a decrease in the estimated volatility and remaining terms of the warrants.

Quarterly Results of Operations

The following table sets forth our unaudited quarterly consolidated statements of operations data for each of the eight quarters in the period ended September 30, 2007. The data has been prepared on the same basis as the audited consolidated financial statements and related notes included in this prospectus and you should read the following table in conjunction with such financial statements. The table includes all necessary adjustments, consisting only of normal recurring adjustments that we consider necessary for a fair presentation of this data.

	Three Months Ended
	Dec. 31, 2005			March 31, 2006			June 30, 2006			Sep. 30, 2006			Dec. 31, 2006			March 31, 2007			June 30, 2007			Sep. 30, 2007
	(In thousands, except per share data)
Revenues:
Service	$	8,210		$	6,275		$	12,657		$	11,753		$	11,312		$	11,564		$	13,007		$	14,698
Product		3,027			2,502			2,493			2,394			2,203			1,442			1,709			478
Total revenues		11,237			8,777			15,150			14,147			13,515			13,006			14,716			15,176
Cost of revenues:
Cost of service revenues		3,536			4,029			4,968			5,222			5,679			6,282			7,176			7,709
Cost of product revenues		2,775			2,277			3,324			754			1,962			1,371			1,531			412
Total cost of revenues		6,311			6,306			8,292			5,976			7,641			7,653			8,707			8,121
Gross profit		4,926			2,471			6,858			8,171			5,874			5,353			6,009			7,055
Operating expenses:
Research and development		3,315			4,391			4,622			5,418			4,633			5,684			6,081			6,099
Sales and marketing		1,218			1,433			1,746			1,326			1,866			1,967			1,663			1,524
General and administrative		1,060			1,953			1,886			2,100			1,496			1,198			1,832			2,015
Total operating expenses		5,593			7,777			8,254			8,844			7,995			8,849			9,576			9,638
Loss from operations		(667	)		(5,306	)		(1,396	)		(673	)		(2,121	)		(3,496	)		(3,567	)		(2,583	)
Other income (expense), net		686			587			683			(1,849	)		525			(2,235	)		1,048			142
Income (loss) before provision for income taxes and cumulative effect of change in accounting principle		19			(4,719	)		(713	)		(2,522	)		(1,596	)		(5,731	)		(2,519	)		(2,441	)
Provision for income taxes		(11	)		(9	)		(18	)		(16	)		(9	)		(20	)		(17	)		(28	)
Income (loss) before cumulative effect of change in accounting principle		8			(4,728	)		(731	)		(2,538	)		(1,605	)		(5,751	)		(2,536	)		(2,469	)
Cumulative effect of change in accounting principle		1,421			—			—			—			—			—			—			—
Net income (loss)		1,429			(4,728	)		(731	)		(2,538	)		(1,605	)		(5,751	)		(2,536	)		(2,469	)
Accretion of redemption value on redeemable convertible preferred stock		(3,427	)		(3,670	)		(3,683	)		(3,697	)		(3,912	)		(3,921	)		(3,933	)		(3,944	)
Net loss per share attributable to common stockholders	$	(1,998	)	$	(8,398	)	$	(4,414	)	$	(6,235	)	$	(5,517	)	$	(9,672	)	$	(6,469	)	$	(6,413	)
Net loss per share attributable to common stockholders—basic and diluted	$	(0.13	)	$	(0.56	)	$	(0.29	)	$	(0.40	)	$	(0.35	)	$	(0.60	)	$	(0.39	)	$	(0.38	)
Includes the following stock-based compensation expense:
Cost of revenues	$	—		$	—		$	—		$	—		$	3		$	5		$	17		$	57
Research and development		1			1			—			—			7			14			38			105
Sales and marketing		—			—			—			—			1			1			6			23
General and administrative		2			—			—			—			6			3			12			56

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We may experience spikes in new subscriber activations and in premium applications, content and services revenues as a result of the release of new Danger-enabled mobile device models or new premium applications, content and services. In addition, our and our mobile operator customers’ marketing efforts tend to increase to support the launches of new devices. New Danger-enabled mobile devices were launched in July 2006 and April 2007 and subscribers and premium applications, content and services revenues increased accordingly.

During the holiday shopping season, mobile device sales typically increase, driving new subscriber activations and an increase in premium applications and content downloads. However, since we account for our premium applications, content and services revenues using a subscription model, we do not experience a noticeable spike in revenues during the three months ending December 31, but rather an acceleration of our growth rate.

In addition, if a specified deliverable is deemed present in our arrangements with a mobile operator, all revenues associated with that arrangement, including monthly service revenues, are deferred until the specified deliverable is provided. Our new contract with T-Mobile USA included a specified deliverable and, as a result, we deferred all revenue under that arrangement from March 2006, when we signed the arrangement, until we provided the specified deliverable in May 2006, at which point we recognized $2.9 million of monthly service revenues in the three month period ended June 30, 2006 that had been invoiced in the three month period ended March 2006.

As a result of these and other factors impacting our revenues, costs of revenues and operating expenses, our operating results have fluctuated significantly from period to period and can be expected to fluctuate significantly in future periods. The results of historical periods are not necessarily indicative of the results of operations for a full year or any future period.

Liquidity and Capital Resources

Since inception, we have generated significant operating losses and as a result have not generated sufficient cash flow to fund our operations. As of September 30, 2007, our accumulated deficit was $188.1 million. We have financed our operations primarily through the sale of redeemable convertible preferred stock for total consideration of approximately $144.0 million, capital lease financing arrangements for approximately $13.6 million and other indebtedness of approximately $2.1 million. As of September 30, 2007, our cash and cash equivalents were $13.0 million and our working capital was $9.0 million. We invest our excess cash in short-term investments in a variety of high credit quality securities, including obligations of U.S. government agencies, corporate bonds, repurchase agreements, commercial paper, master notes and money market funds.

In October 2007, we entered into a loan and security agreement with Silicon Valley Bank providing for maximum borrowings of $12.0 million. Our agreement with Silicon Valley Bank provides for up to $5.0 million of revolving loans which may be drawn through October 2008 and for 36-month term loans with maximum aggregate borrowings of $7.0 million. Our agreement requires that the term loans be advanced on or before March 31, 2008. Borrowings under our agreement with Silicon Valley Bank are secured by substantially all of our tangible assets and certain of our intangible assets.

Our agreement with Silicon Valley Bank includes several covenants that place restrictions on the incurrence of additional debt and liens; certain changes in management or ownership, investments, the payment of dividends; and limitations on our ability sell or dispose of any of our assets outside the normal course of business and our ability to engage in mergers and acquisitions.

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Summary of Cash Flows

The following table shows a summary of our cash flows for the years ended September 30, 2005, 2006 and 2007:

	Years Ended September 30,
	2005			2006			2007
	(In thousands)
Cash flows used in operating activities	$	(17,883	)	$	(7,618	)	$	(6,395	)
Cash flows used in investing activities		(8,107	)		(1,999	)		(6,267	)
Cash flows provided by financing activities		2,417			16,076			8,459

Operating Activities

Cash used in operating activities for the year ended September 30, 2007 reflected our net loss of $12.4 million, offset by adjustments for non-cash expenses consisting primarily of depreciation and amortization of $5.7 million and charges of $1.0 million associated with the measurement of our preferred warrant liability to fair value. Cash used in operating activities is significantly affected by the timing in accounts receivable payments from T-Mobile USA. Accounts receivable at September 30, 2007 were $11.9 million as compared to $7.4 million at September 30, 2006. The increase in accounts receivable was primarily related to an increase in the number of T-Mobile USA’s subscribers that had access to our mobile data services and also to one-time billings related to premium applications, content and services and services generating NRE fees. Deferred revenues and deferred costs decreased by $1.6 million and $3.6 million respectively, representing the recognition of revenues from previously invoiced client license fees as well as revenues and costs associated with the sale of Danger-enabled mobile devices by us prior to March 2006.

Cash used in operating activities for the year ended September 30, 2006 reflected our net loss of $6.6 million, offset by non-cash adjustments consisting primarily of depreciation and amortization of $3.6 million, the cumulative effect of change in accounting principle of $1.4 million, a charge of $907,000 associated with the measurement of our preferred warrant liability to fair value, and a charge of $860,000 associated with the issuance of a performance warrant. In addition, deferred revenues and deferred costs decreased by $14.0 million and $8.6 million, respectively, representing the recognition of revenues from previously invoiced client license fees as well as revenues and costs associated with the sale of Danger-enabled mobile devices by us prior to March 2006.

Cash used in operating activities for the year ended September 30, 2005 reflected our net loss of $9.9 million, offset by non-cash adjustments consisting primarily of depreciation and amortization of $2.5 million. In addition, accounts receivable increased $3.2 million due to an increase in the number of our customers’ subscribers that had access to our mobile data services and due to an increase in our accounts receivable days sales outstanding at September 30, 2005 as compared with September 30, 2004. In addition, accrued expenses and other liabilities decreased $4.4 million, resulting primarily from a decrease in accrued warranty due to the payment of $6.0 million to settle hardware warranty obligations during the year ended September 30, 2005. In addition, deferred revenues and deferred costs decreased $15.5 million and $11.1 million, respectively, for the year ended September 30, 2005, representing the recognition of revenues from previously invoiced client license fees as well as revenues and costs associated with the sale of Danger-enabled mobile devices by us to our mobile operator customers.

Investing Activities

Cash used in investing activities relates primarily to capital expenditures for the expansion of our data centers and to a lesser extent purchases of software development licenses and leasehold improvements. We expect to increase our capital expenditures for data center equipment and software significantly in the year ending September 30, 2008 as we commence operations in an additional data center location and increase the

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capacity of our mobile data services. Capital expenditures in the years ended September 30, 2005, 2006 and 2007 were $6.1 million, $6.4 million and $6.5 million, respectively. Cash used in investing activities during the year ending September 30, 2005 included purchases of short-term investments and an increase in restricted cash, partially offset by sales of short-term investments. During the year ended September 30, 2005, we entered into an equipment lease agreement that required a deposit of $3.6 million in a restricted bank account. We terminated the lease during the year ending September 30, 2006 and the cash held in the restricted bank account was released.

Financing Activities

Net cash provided by financing activities in the years ended September 30, 2007 and 2006, consisted primarily of proceeds from our sale of redeemable convertible preferred stock, and borrowings pursuant to our capital lease financing arrangements. Net cash provided by financing activities during the year ended September 30, 2005 consisted primarily of $3.5 million in borrowings pursuant to our capital lease financing arrangements. During the year ended September 30, 2006 we terminated the lease and paid the outstanding principal and interest accrued of $2.8 million.

Capital Requirements

Our future liquidity and capital requirements will be influenced by numerous factors, including:

• the extent and duration of future operating losses;

• the level and timing of future sales and expenditures;

• the results and scope of ongoing research and development programs;

• working capital required to support our growth and data center expansions;

• our sales and marketing programs;

• the continuing acceptance of our mobile data services in the marketplace;

• competing technologies; and

• market developments.

We believe that our existing working capital and borrowings available under our loan agreement with Silicon Valley Bank will be sufficient to fund our working capital requirements, capital expenditures and operations for at least the next 12 months.

Our ability to fund our longer-term cash needs is subject to various risks, many of which are beyond our control. Should we require additional funding, such as to satisfy our short-term and long-term obligations when due, fund our operations, or to make additional capital investments, we may need to raise the required additional funds through bank borrowings or public or private sales of debt or equity securities. We cannot guarantee that such funding will be available on terms favorable to us, or at all. If we raise additional funds through the incurrence of additional indebtedness, our lenders could demand rights that are senior to holders of our common stock and could require covenants that restrict our operations. Any additional equity financing may be dilutive to our stockholders. In addition, if we raise additional funds through the sale of equity securities, new investors could have rights superior to our existing stockholders. The terms of future financings may also restrict our ability to raise additional capital.

Off-balance Sheet Arrangements and Other Contractual Obligations

Other than operating leases, we do not have any off-balance sheet financing arrangements. In conjunction with our arrangements with mobile operator customers and OEM partners in the ordinary course of business, we provide standard indemnification for losses suffered or incurred for patent, copyright or any other intellectual

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property infringement claims brought by third parties relating to the Danger solution. The term of these indemnification arrangements is generally perpetual. The maximum potential amount of future payments we could be required to make under these arrangements is unlimited. In prior periods, we have incurred significant costs related to defending claims, including $2.5 million in the year ended September 30, 2006.

The following table summarizes our significant contractual obligations and commercial commitments as of September 30, 2007:

Contractual Obligations and Commercial Commitments	Payment Due By Period
	Total		Less Than 1 Year		1-3 Years		3-5 Years		More Than 5 Years
	(In thousands)
Operating lease obligations(1)	$	5,047	$	1,710	$	2,693	$	644	$	—
Capital lease obligations (including interest)(2)		5,182		2,445		2,737		—		—
Purchase obligations(3)		7,921		3,134		4,670		117		—
Installment payable (including interest)(4)		895		784		111		—		—
	$	19,045	$	8,073	$	10,211	$	761	$	—

(1) We lease our facilities and office space in the United States. Operating lease obligations include total future payments under all of our operating leases as of September 30, 2007. Under certain operating leases, we have an option to terminate the lease early by providing advance notice and paying an early termination fee. Since we do not contemplate terminating these leases early, our future payments under operating lease obligations includes total future payments through the end of the initial lease terms.

(2) We lease equipment in the United States under capital lease obligations.

(3) Purchase obligations reflect total future payments on agreements related to our data centers as of September 30, 2007, certain of which are cancelable subject to penalty. In October 2007, we entered into an agreement for our planned new data center in Phoenix, Arizona. This agreement has a four year term with payments totaling $3.9 million over the term of the agreement. In November 2007, we entered into an agreement to upgrade our current multiple point-to-point internet connectivity to support future growth. This agreement has a four year term with payments totaling $3.7 million over the term of the agreement. As a result of this new agreement, existing commitments to such vendor of $743,000 as of September 30, 2007, which are reflected in the table above, were included in the new agreement.

(4) The installment payable is related to purchases of enterprise software and system maintenance as of September 30, 2007. In November 2007, we entered into an agreement to purchase additional enterprise software and system maintenance. This agreement has a three year term with payments totaling $4.9 million over the term of the agreement. Of the amounts outstanding as of September 30, 2007, $484,000 is included in this new agreement and the remaining balance has been paid in full.

Quantitative and Qualitative Disclosures about Market Risk

Market risk represents the risk of changes in the value of market risk sensitive instruments caused by fluctuations in interest rates, foreign exchange rates and commodity prices. Changes in these factors could cause fluctuations in our results of operations and cash flows. In the ordinary course of business, we are exposed to interest rate and foreign exchange risk. Fluctuations in interest rates and the rate of exchange between the U.S. dollar and foreign currencies, primarily the British Pound, could adversely affect our financial results.

Substantially all of our sales are denominated in U.S dollars. We therefore have limited foreign currency risk associated with the sale of our service. Expenses associated with our European colocation data services facility are denominated in Euros. Our international sales and marketing operations incur expenses that are denominated in foreign currencies, primarily the British Pound. These expenses could be materially affected by currency fluctuations; however, we do not consider this currency risk to be material as the related costs do not constitute a significant portion of our total operating expenses.

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We had cash and cash equivalents of $13.0 million at September 30, 2007, all of which was held for working capital purposes. The primary objectives of our investment policy are to preserve principal, maintain proper liquidity to meet operating needs and maximize yields. Our investment policy allows us to maintain a portfolio of cash, cash equivalents and short-term investments in a variety of high credit quality securities, including obligations of U.S. government agencies, corporate bonds, repurchase agreements, commercial paper, master notes and money market funds. If short-term interest rates were to increase or decrease by 10% from the rate on September 30, 2007, the increase or decrease in interest income would not have a material effect on our cash flows or results of operations.

We believe that inflation has not had a material impact on our historical results of operations; however, there can be no assurance that our business will not be affected by inflation in the future.

In addition, we have outstanding credit facilities under which we incur interest expense. If short-term interest rates were to increase or decrease by 10% from the rate on September 30, 2007 the increase or decrease in interest expense would not have a material effect on our cash flows or results of operations.

Recent Accounting Pronouncements

In July 2006, the Financial Accounting Standards Board, or FASB, issued FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes—an Interpretation of FASB Statement No. 109, or FIN 48. FIN 48 prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. FIN 48 was effective for us beginning October 1, 2007. We are currently evaluating the impact that the adoption of FIN 48 will have, if any, on our consolidated financial position, results of operations or cash flows.

In September 2006, FASB issued SFAS No. 157, Fair Value Measurements, or SFAS 157, which provides guidance on how to measure assets and liabilities that use fair value. SFAS 157 will apply whenever another GAAP standard requires (or permits) assets or liabilities to be measured at fair value but does not expand the use of fair value to any new circumstances. This standard also will require additional disclosures in the financial statements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. We are currently evaluating the impact that the adoption of SFAS 157 will have, if any, on our consolidated financial position, results of operations or cash flows.

In September 2006, FASB ratified EITF Issue No. 06-1, Accounting for Consideration Given by a Service Provider to a Manufacturer or Reseller of Equipment Necessary for an End-Customer to Receive Service from the Service Provider, or EITF 06-1. Under EITF 06-1, consideration received by a service provider’s end-customer from a manufacturer or reseller constitutes consideration given by the service provider to the end-customer if the manufacturer or reseller is required by contract with the service provider to provide consideration to the end-customer. If such a contractual arrangement exists, classification of the consideration in the service provider’s income statement depends on the form of the consideration received by the end-customer. Cash consideration would be reported as a reduction of revenue; non-cash consideration, as defined in EITF 01-9, Accounting for Consideration Given by a Vendor to a Customer (Including a Reseller of the Vendor’s Products), including free or discounted product, would be reported as an expense. EITF 06-1 is effective for the first annual reporting period beginning after June 15, 2007. We do not expect that the adoption of EITF 06-1 will have a material effect on our consolidated financial position, results of operations or cash flows.

In February 2007, FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of FASB Statement No. 115, or SFAS 159. SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required

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to be measured at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS 159 does not affect any existing accounting literature that requires certain assets and liabilities to be carried at fair value. SFAS 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. We do not expect that the adoption of SFAS 159 will have a material effect on our consolidated financial position, results of operations or cash flows.

In September 2006, the SEC issued Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, or SAB 108. SAB 108 provides guidance on the consideration of the effects of prior year misstatements in quantifying current year misstatements for the purpose of determining whether the current year’s financial statements are materially misstated. Registrants must begin to apply the provisions of SAB 108 no later than the annual financial statements for their first fiscal year ending after November 15, 2006. We do not expect that the adoption of SAB 108 will have a material effect on our consolidated financial position, results of operations or cash flows.

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BUSINESS

Overview

We are a software-as-a-service company that provides mobile operators with an integrated end-to-end solution to deliver mobile data and Internet services to their subscribers. As advanced Internet and messaging services are increasingly becoming available on mobile devices, our solution enables operators to offer their subscribers a differentiated and compelling mobile data and Internet experience and, consequently, helps our operator customers increase their average revenue per user, or ARPU. Our solution is deployed in the United States and certain international markets through the T-Mobile Sidekick family of mobile devices and in other international markets, including Australia and Europe, through mobile devices utilizing our “hiptop” brand.

The Danger solution integrates our hosted service delivery engine, or SDE, and our client software with Danger-enabled mobile devices manufactured by Sharp Corporation and Motorola, Inc., our original equipment manufacturer, or OEM, partners. Our technology platform enables fast subscriber access to data services, provides data compression and optimization, and provides users with the ability to run multiple applications simultaneously. Our solution offers real-time email, instant messaging and social networking services, and HTML web browsing, as well as premium applications, content and services developed internally and through our third-party developer program.

We leverage the expertise and scale of our mobile operator customers and our OEM partners to help manufacture, market and distribute Danger-enabled mobile devices to a broad consumer audience. By delivering the Danger solution as a service, we allow our mobile operator customers to leverage our infrastructure, third-party developer program and expertise in deploying an end-to-end mobile data service offering with minimal capital investment.

We receive recurring monthly service fees from our mobile operator customers for each subscriber that has access to our mobile data services, and we also generate revenues from the premium applications, content and services that we provide. From the introduction of our solution in October 2002 through September 30, 2007, the number of subscribers to our mobile data services has grown to approximately 923,000. Our total revenues have grown from $49.3 million in the year ended September 30, 2006 to $56.4 million in the year ended September 30, 2007, and our service revenues have grown from $38.9 million in the year ended September 30, 2006 to $50.6 million in the year ended September 30, 2007.

Industry Overview

The mobile data services market is in a period of transition and growth fueled by consumer adoption, mobile operator competition, advances in mobile device technologies and the convergence of the traditional Internet and mobile communications industries. As a result of these trends, mobile devices are no longer predominantly used for a single function, such as voice, but are increasingly becoming an important platform for multiple forms of communication, access to information, consumption of media and content creation.

Increased adoption of mobile data services.    Mobile data services have been rapidly adopted by particular demographic segments due to the emergence of compelling services and applications. For example, business end-users have adopted email and personal information management solutions, while young adults and teens have actively embraced mobile data services such as text messaging, ringtones and graphics. We believe that these early adopters have laid the foundation for mass market use of these and more enhanced mobile data offerings, such as Internet services traditionally accessed through a personal computer. Mobile data services are expected to have broad consumer appeal and represent a key source of growth for the mobile industry. According to Yankee Group Research, Inc., a technology research and consulting firm, the number of global mobile data service users will increase to approximately 2.5 billion in 2011, with mobile data revenues expected to grow to $200.8 billion in 2011, from 1.5 billion and $108.8 billion, respectively, in 2006.

Aggressive pursuit of data revenue by mobile operators.    As the market for mobile voice services matures and barriers for consumers to switch providers have been reduced, competition among mobile operators has intensified. As a result, prices for core voice services in mature markets are expected to decrease. According to

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IDC, an independent market research firm, ARPU for voice services in the United States is expected to decline from $45.71 in 2006 to $36.64 by 2011. In response to this pricing dynamic, mobile operators are offering new and enhanced mobile data services to increase competitive differentiation, appeal to new consumers and increase ARPU. To further these goals, many mobile operators have begun to offer fixed-rate, unlimited mobile data service plans and have begun partnering with leading technology and media companies to offer a broad range of innovative applications, content and services. IDC estimates that the ARPU for consumer wireless data subscribers in the United States will grow from $5.56 per month in 2006 to $12.35 per month in 2011, representing a compound annual growth rate of 17.3%.

Proliferation of converged mobile devices.    Mobile device manufacturers are developing advanced, converged mobile devices, commonly known as smartphones, that can be marketed to consumers at affordable prices. Relative to basic mobile phones and feature phones, or basic mobile phones that support certain advanced data features such as cameras, music players and text messaging, smartphones have faster processors, greater storage, Internet connectivity and high-resolution color screens, and are capable of supporting advanced operating systems and enhanced applications. We believe that smartphones, particularly those with tightly-integrated software and services, have the potential to blur the lines between mobile and personal computer data services. IDC estimates that the total number of converged mobile devices shipped globally will grow from 80.9 million in 2006 to 304.4 million in 2011, representing a compound annual growth rate of 30.3%. In 2006, these converged mobile devices comprised approximately 7.9% of worldwide mobile phone shipments and are expected to comprise approximately 21.3% of worldwide mobile phone shipments in 2011, according to IDC.

Emergence of social networking, peer communications and user-generated content.    Consumers are increasingly utilizing the Internet as a means of social interaction, self-expression and entertainment by accessing leading social networking sites such as MySpace and Facebook, and instant messaging platforms such as AOL Instant Messenger, Yahoo! Messenger and Microsoft Corporation’s Windows Live Messenger. For example, in October 2007, there were 509.6 million unique visitors to social networking sites globally, according to comScore, Inc., an Internet industry research firm. According to comScore, use of many of these sites has grown rapidly, as users spent 39.4 billion minutes at the top five global social networking sites in October 2007, an increase of 94.1% from the 20.3 billion minutes spent on those same sites in October 2006.

The increased capabilities of converged mobile devices to enable messaging and user-generated content makes them a desirable platform to provide anytime, anywhere participation in these social networking and other online communities. Additionally, by leveraging uniquely mobile attributes to enable real-time or location-specific services, the shared experiences offered by these communities can be enhanced. IDC estimates that in the United States alone, the number of mobile instant messaging users will grow at a compound annual growth rate of 44.9%, from 12.4 million in 2006 to 79.3 million in 2011.

Challenges for mobile operators in delivering a compelling mobile data and Internet experience.     Notwithstanding the market opportunity and consumer demand for mobile data services, mobile operators face significant challenges in delivering a compelling mobile data and Internet experience that combines the ease of use and capabilities of personal computers with the unique attributes of mobile devices. These challenges include the following:

• Rising consumer expectations.    Consumers are increasingly expecting their mobile data experience to be a seamless extension of their personal computer experience. Relative to the consumer experience on the personal computer, the consumer mobile data and Internet experience has been limited due to lost or intermittent data connections, lack of access to particular Internet sites, poor rendering of Internet sites on small mobile device screens, inability to run concurrent applications and lack of real-time interactivity and communication.

• Increasing complexity of Internet applications and services.    The emergence of new Internet service categories, such as social networking, together with the proliferation of enhanced personal computer browser technologies, such as Flash and AJAX, has led to increased complexity in the applications and

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services delivered over the Internet. Many current mobile data platforms are not capable of delivering compelling mobile versions of these complex Internet services.

• Lack of services for advanced handsets.    Advances in handset technology have led to the development of an increasing number of mobile devices capable of providing advanced data services. However, there is a lack of mobile data and Internet services that enable consumers to utilize many of the advanced capabilities of these devices.

• Inefficient service platforms.    Mobile operators have traditionally relied on mobile devices to process content and messages, or required Internet providers to reconstitute their sites into specific, limited wireless application protocol web browser, or WAP, implementations. While this approach might have been satisfactory for the delivery of basic data services, enhanced mobile data services require a more sophisticated back-end service infrastructure to process, compress and optimize data, push content to users and maintain persistent connectivity with both the device and the Internet.

• Lack of integration in mobile data delivery platforms.    The legacy systems of many mobile operators entail loose integration of disparate hardware, software and service delivery technologies from multiple vendors to reach the broadest possible audience. We believe that the fragmentation of these multiple components on mobile data delivery platforms inhibits operators from offering optimized solutions to the handsets in their mobile device portfolio. In particular, we believe that the lack of a single, tightly-integrated solution often compromises consumers’ experiences by not utilizing the full potential of each component.

• Limited internal development, deployment and management resources.    Mobile operators have traditionally limited their internal investment in the deployment, development and management of mobile applications, content and services, focusing instead on network infrastructure and basic service delivery. The lack of internal resources dedicated to providing a compelling mobile data and Internet solution has led to the deployment of poorly integrated mobile data service offerings that we believe fail to fully capitalize on the opportunities created by consumer adoption trends, developments in handset technology and the emergence of new Internet services.

As a result of the above, we believe that existing mobile consumer data solutions not only provide suboptimal consumer experiences, but also result in lost revenue opportunities, longer development cycles, more costly overall development and deployment, and ongoing management, billing and customer service challenges. In order to overcome these challenges and successfully capitalize on the market opportunity for the deployment of a compelling mobile data and Internet solution to consumers, we believe that mobile operators will increasingly turn to third parties to provide end-to-end integrated solutions.

Our Solution

We provide mobile operators with an integrated end-to-end solution for delivering an enhanced mobile data and Internet experience to their subscribers. The Danger solution powers advanced data applications and services on Danger-enabled mobile devices developed and manufactured by our OEM partners, and features premium applications, content and services developed internally and through our third-party developer program. The Danger solution is designed to be easy for our mobile operator customers to deploy and manage, and to integrate seamlessly with their back-end systems. Key features of the Danger solution include the following:

Superior mobile data and Internet experience for consumers.    The Danger solution adds real-time email, popular instant messaging and social networking services, HTML web browsing, and easy access to premium applications, content and services to standard voice and personal information management features, and provides an intuitive user-interface to mimic a personal computer experience on a mobile device. The Danger solution devices enhance consumers’ experiences by actively pushing email, instant messages and other content to Danger-enabled mobile devices; notifying users of new communications; and promoting messaging, content sharing and other forms of online social interaction. Our client software and integrated applications enable users to run different applications simultaneously and to easily switch among these applications. For example, while a

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consumer is using the web browser to access a web page, she can reply to an instant message, type an email, build a playlist in the MP3 player, and then return to the same web page without losing her place. In addition, our data optimization technology speeds consumer access to mobile data services and optimizes content for viewing on Danger-enabled mobile devices.

The strength of our solution is demonstrated by the frequent use of interactive mobile applications and heavy consumption of downloadable mobile content by consumers using Danger-enabled mobile devices. During the quarter ended September 30, 2007, consumers using Danger-enabled mobile devices, on a monthly basis:

• sent and received an average of 3,223 instant messages;

• viewed an average of 481 web pages; and

• sent and received an average of 930 text messages.

Additionally, more than 60% of consumers using Danger-enabled mobile devices purchased downloadable content during the quarter ended September 30, 2007, with each purchaser buying an average of four downloadable content items during the quarter ended September 30, 2007.

End-to-end integrated mobile data and Internet solution for mobile operators.    We offer mobile operators a single, tightly-integrated solution that enables them to capitalize on advances in mobile devices, network technologies and Internet services to offer consumers a more compelling mobile data and Internet experience. The Danger solution manages many of the components of the mobile data offerings of our operator customers, including: mobile device integration; access to and delivery of premium applications, content and services; subscriber data management and storage; and integration with back-end systems for marketing, billing, provisioning and support. Our solution also provides mobile operators with the flexibility to utilize their own brands to target particular consumer demographics with differentiated mobile data applications and services designed to drive subscriber retention, attract new customers and increase voice and data revenue.

Powerful technology platform enabling optimized delivery of enhanced mobile data services.    The Danger technology platform consists of our hosted SDE and client software for mobile devices. The tight coupling of our SDE and client software optimizes the delivery of enhanced mobile data services by compressing content, managing network and device communications, facilitating the real-time delivery of software upgrades and additional features, and synchronizing and storing data in a manner easily accessible by the consumer. Our SDE communicates with our client software, which provides a PC-like experience on a mobile device by enabling multiple applications to run and use the network simultaneously. Our client software also seamlessly integrates our core applications as well as premium applications, content and services. Our solution is supported by our portfolio of intellectual property, including, as of September 30, 2007, 34 U.S. patents, eight foreign patents, 40 pending U.S. patent applications and 47 pending foreign patent applications.

Close collaboration with mobile device manufacturers.    We collaborate closely with our OEM partners throughout the design and development process of Danger-enabled mobile devices, allowing us to better integrate our software into their devices and to optimize performance, minimize design flaws and accelerate device development. Our close collaboration enables our OEM partners to offer mobile operators intuitive, converged mobile devices that provide consumers with access to enhanced data mobile services. We provide reference designs and software to our OEM partners to closely couple the hardware layout and form factor of Danger-enabled mobile devices with the desired functionality and user experience. We also license our client software, which includes an integrated suite of software applications, to our OEM partners to pre-install on Danger-enabled mobile devices.

Large and growing third-party developer program.    In addition to the internal development of our core data applications, we have cultivated a large and growing third-party developer program for the creation of premium applications, content and services to be distributed on our platform. Our third-party developer program is designed to foster a steady and competitive pipeline of premium applications, content and services that we believe enhance the overall consumer experience. Our third-party developers leverage our integrated technology platform and our operator and OEM relationships to commercialize and distribute premium applications, content

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and services to a broad audience through a single point of distribution. By encouraging third-party development of content for our platform, we are able to continuously extend the functionality and breadth of our offering and enhance the value of our solution. We have experienced rapid growth in our developer program, with more than 50 of our third-party developers publishing an aggregate of 218 games, applications and networked services as of September 30, 2007.

Leveraged, software-as-a-service business model aligned with customer interests.    We deploy our solution through a software-as-a-service business model that enables us to leverage the reach and expertise of our mobile operator customers, OEM partners and third-party developers so we can scale rapidly while minimizing our investment. We apply our OEM partners’ technology expertise and manufacturing capabilities to manufacture Danger-enabled mobile devices. In addition, we use our mobile operator customers’ brands, marketing efforts and existing retail distribution to attract subscribers to our mobile data services, and draw on our third-party developers’ software development expertise to introduce compelling new applications, content and services. We also believe that our software-as-a-service business model is attractive to mobile operator customers because it allows them to leverage our infrastructure, partnerships, expertise and resources to deploy an end-to-end mobile data service offering with minimal capital investment. In addition, because our business model only requires our operator customers to pay ongoing fees for subscribers that are active on our platform, our operator customers are not required to make large financial commitments in advance of acquiring subscribers.

Our Strategy

Our objective is to expand our position as a leading provider of mobile consumer data services and to increase the value of our solution for mobile operators worldwide. The principal elements of our strategy are to:

Extend our leadership position by strengthening and broadening our solution.    We believe that our advanced technology architecture, focus on the consumer market, and software-as-a-service business model have made us a leading provider of end-to-end integrated mobile consumer data solutions. We seek to extend our leadership position and enhance our solution by developing new features, applications and services that utilize our technology platform to create a compelling mobile data and Internet experience for consumers. In particular, we expect to continue to expand our integration with popular email and emerging consumer Internet sites and services, as well as various multimedia, location-based and social networking services.

Pursue new mobile operator relationships and expand our distribution globally.    We intend to increase the number of subscribers using Danger-enabled mobile devices by adding new mobile operator customers, particularly in Europe and other international markets. We believe that we are well positioned to add new mobile operator customers because we offer a highly scalable end-to-end mobile data solution and provide unique and differentiated applications, content and services. We expect to aggressively pursue new relationships in select international markets where consumer behavior and the adoption of enhanced mobile data services lend themselves to the Danger solution. Additionally, we believe that we can leverage the close relationships between our OEM partners and their existing mobile operator customers to develop new mobile operator relationships.

Extend and deepen our OEM partnerships.    We seek to continue to enhance our existing OEM partnerships and develop new relationships with leading global OEMs to produce a greater number of Danger-enabled mobile devices for marketing to a broader global audience. We believe that our advanced and flexible technology platform and our close development collaboration with our OEM partners will enable them to produce mobile devices with a variety of features, form factors and price points that appeal to diverse consumer segments in various geographies, thereby increasing the potential adoption of the Danger solution. In addition, we plan to continue our close collaboration with our existing OEM partners to enable them to reduce development time and achieve lower costs for Danger-enabled mobile devices.

Increase the number of subscribers using our mobile data services.    We also intend to increase the number of subscribers using our mobile data services through the growth of our relationships with our existing mobile operator customers. We believe that we can create unique services for targeting new demographic segments and

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leverage the sales and marketing efforts of our mobile operator customers to extend our subscriber reach with each of our existing customers. In addition, we believe that we can also extend subscriber reach by working closely with our existing and potential future OEM partners to produce a greater number of Danger-enabled mobile devices at various price points.

Expand the development of third-party applications, content and services for our platform.    We expect to continue growing our third-party developer program to increase the rapid development of new premium applications, content and services that we believe enhance the overall consumer experience, increase our competitive differentiation and monetize the mobile subscriber base. By providing our third-party developers with access to a subscriber base that frequently downloads applications and content, and integrated programming tools that streamline the development, deployment and billing of downloadable applications and content, we believe that we can successfully encourage third-party developers to continue to provide their services through the Danger platform as well as add new third-party developers to our developer program.

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Our Platform and Services

Our solution consists of our tightly-integrated hosted SDE, client software for mobile devices, and premium applications, content and services offerings. We receive recurring monthly service fees from our operator customers for each of their subscribers that are able to access our mobile data services, and we also generate revenues from the premium applications, content and services solution that we provide to our mobile operator customers. During the year ended September 30, 2007, the number of subscribers to our mobile data services increased by approximately 360,000, from approximately 563,000 subscribers as of September 30, 2006 to approximately 923,000 subscribers as of September 30, 2007.

The diagram below shows the elements of the Danger solution and how we interact with our mobile operator customers, OEM partners and content providers to deliver our mobile data services to subscribers.

Danger Service Delivery Engine.    Our server-based hosted SDE communicates with our client software, enhancing and optimizing the delivery of mobile data services to Danger-enabled mobile devices. We have designed our SDE to provide a high level of service reliability and scalability to support wireless network traffic and subscriber base growth. Key features of our SDE include:

• Data optimization.    Our SDE compresses and packages data to speed consumer access to mobile data services while simultaneously reducing wireless network traffic for our mobile operator customers. We believe that our data optimization capabilities allow our mobile operator customers to more efficiently offer mobile data services to subscribers. Our SDE also processes content for viewing on Danger-enabled mobile devices before content is transmitted. For example, our SDE resizes email message images and attachments to fit the Danger-enabled mobile device screen dimensions, and modifies web page layouts in an effort to provide subscribers with an experience that more closely resembles email use and internet browsing on a personal computer.

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• Always-on connection and push delivery.    Our SDE is designed to maintain a persistent connection to Danger-enabled mobile devices, allowing for a constant stream of emails, instant messages and notifications to be delivered to the device. The SDE actively transfers, or pushes, messages to Danger-enabled mobile devices, eliminating the need for subscribers to initiate a connection to receive messages, notifications or to request web pages and other data. Similarly, if a subscriber loses a wireless connection, our SDE manages the subscriber’s data session and queues incoming messages, such as those from an active instant messaging conversation, for delivery to the mobile device when wireless network coverage is restored.

• Integration with third-party Internet services.    Our SDE enables a unique degree of integration with popular third-party Internet services including email, instant messaging and social networking services. We have collaborated with Yahoo! Inc., Microsoft Corporation, AOL LLC, a majority-owned subsidiary of Time Warner Inc., and MySpace, Inc., a unit of News Corporation, to allow our SDE to access their proprietary application programming interfaces, or APIs, so that we can deliver enhanced implementations of their respective services for Danger-enabled mobile devices. We believe that due to the integration and tight coupling of our SDE to the associated client applications, our implementations of these third-party Internet services are superior to what can be offered on other mobile devices. For instance, because our SDE maintains a private connection to MySpace, Inc. through proprietary APIs, Danger-enabled mobile device users can generally maintain a persistent connection to their MySpace, Inc. account and automatically receive messages and notifications, rather than having to constantly refresh a web browser to view their account activity.

• Over-the-air software delivery.    Our SDE is designed to deliver additional applications and features over-the-air to Danger-enabled mobile devices as well as to deliver software upgrades and modifications. We believe that by delivering new applications and features over-the-air to older device models, we extend the useful life of Danger-enabled mobile devices. Additionally, our over-the-air software delivery helps our operator customers to retain subscribers, reduce device returns and minimize warranty program costs.

• Data synchronization and storage.    Our SDE provides an automated synchronization and storage service to ensure that data on Danger-enabled mobile devices is updated on our hosted platform and is not lost. In addition, subscribers can seamlessly upgrade to a new Danger-enabled mobile device without having to re-enter data or re-personalize their settings. Subscribers can also access and manage data on their device from any PC-based web browser by logging into a personal website to view their synchronized and stored data.

• Subscriber analytics.    Our SDE collects aggregate subscriber data that we analyze on an anonymous basis to better understand subscriber behavior trends and preferences. Based on this analysis, we can enhance our solution in an effort to deliver a more compelling mobile data and Internet experience and to capitalize on subscriber trends. For example, because we can see which websites are most popular with end-users, we can alter how our SDE renders these websites to provide enhanced viewing in addition to the data optimization we already provide. We are also able to better position our premium applications, content and services offerings by utilizing our SDE to adjust on-device promotion and content placement.

Danger Client Software.    Our client software provides a PC-like experience on a mobile device by enabling multiple applications to run simultaneously and allowing consumers to switch among them without having to close an application. For example, while a subscriber is using the web browser to access a web page, she can reply to an instant message, type an email, build a playlist in the MP3 player, and then return to the same web page without losing her place. Our client software features an intuitive user interface that makes the discovery, use of and navigation within and among applications easy, and allows subscribers to personalize their Danger-enabled mobile devices in a variety of ways. We internally developed all of the core applications that run on Danger-enabled mobile devices so that they are integrated with one another, our operating system and our SDE. As an example of this integration, if a subscriber clicks on a web page link sent in an instant message, our

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web browser instantly launches and communicates with our SDE to obtain the web page and the user can toggle between the two applications.

We license our client software to our OEM partners, which they pre-install on Danger-enabled mobile devices so that subscribers may connect to our SDE immediately after activation. The applications we provide with our client software include:

• Web browser—HTML rendering with JavaScript support;

• Email—push email from operator-branded accounts and popular email services such as AOL, Yahoo! and Hotmail, as well as support for viewing email message attachments;

• Instant messaging—support for AOL Instant Messenger, Yahoo! Messenger and Microsoft’s Windows Live Messenger;

• Premium content catalog—storefront for purchasing games, ringtones and other applications;

• Personal information management—calendar, address book, notes and to-do lists;

• Media player—MP3 player;

• Camera—image gallery with the ability to send images via text message or email;

• Text messaging—text and picture messaging, emoticons, voice notes and auto-responses; and

• Phone—voice calling, teleconferencing, speaker phone and Bluetooth support.

Premium Applications, Content and Services.

Content management and delivery.    We provide our mobile operator customers with an end-to-end solution to offer premium applications, content and services to subscribers using Danger-enabled mobile devices. Subscribers access a premium content catalog on the Danger-enabled mobile device that provides efficient browsing, preview, purchase and management of premium applications, content and services. Subscribers can download games, productivity applications, networked services, ringtones and background themes, all of which are hosted, provisioned and delivered by our SDE. We actively source and publish new premium application, content and service titles in an effort to maintain a steady and competitive premium content catalog for our subscribers.

Our managed premium applications, content and services solution provides our mobile operator customers with a single point for content sourcing, testing, promotion, delivery and billing. Elements of our solution are configurable to allow our mobile operator customers to reflect the branding, organizational and pricing strategies that they offer in their own content portals. However, we typically recommend the merchandizing and pricing for premium applications, content and services for the mobile operator’s approval. Our solution supports several payment models, including one-time fees and monthly recurring fees, and delivers billing records to our mobile operator customers through billing system integration. Our mobile operator customers are responsible for billing and collections with respect to all premium applications, content and services sold, and pay us a share of revenue for every transaction. Our share of revenue varies by mobile operator, content type and content source.

Enhanced content offering.    The collection of the premium applications, content and services available to end users of Danger-enabled mobile devices ranges from traditional mobile content, including basic games and ringtones, to highly differentiated applications, content and services, including networked services, multi-player networked games, multimedia themes and productivity tools. As of September 30, 2007, our master catalog of premium applications, content and services included 161 games, 43 applications, 14 networked services, more than 2,700 ringtones and 66 background themes. The premium applications, content and services available to individual subscribers vary by mobile operator, market and Danger-enabled mobile device model.

Networked services represent a key strategic growth area for our premium applications, content and services offerings, both because of their direct revenue potential as well as their tendency to leverage the greatest number

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of unique capabilities of our technology platform. We believe that services such as these, which are developed internally and through our third-party developer program, allow us to further differentiate our platform and drive value for consumers and our mobile operator customers. Examples of premium networked services include:

• MySpace:    a dedicated client application which provides a personalized, always-on extension of a user’s MySpace account, with push messaging and notifications, optimized posting of messages, blogs and photos and low-latency, or reduced delay, browsing of content; and

• MyAuctioneer:    a real-time, personalized dashboard of a user’s eBay account, including dynamic auction status, bidding capability and persistent notifications for outbid alerts.

Third-party developer program.    A critical component of our premium applications, content and services business is our third-party developer program. We have distributed premium applications, content and services on our platform developed by more than 50 third-party developers, including Gameloft Inc., Digital Chocolate, Inc., Namco Networks America Inc., Konami Digital Entertainment, I-play, and Sony BMG Music Entertainment. We either license content from our third-party developers and pay them a portion of the revenue share we receive from our operator customers or we host content acquired by our operator customers and receive a revenue share for our hosting and delivery services. Our premium applications, content and services business model derives leverage from our developers, who typically bear the up-front costs of development, and from our mobile operator customers, who bear the costs of billing, customer care and subscriber acquisition.

We provide our third-party developers with a suite of development tools and resources to create, simulate and debug premium applications, content and services in a standard Windows-based environment. We also provide extensive developer support and information through both our website and various support groups in order to generate efficiencies in application development and to accelerate submission of content and applications to us for certification and eventual deployment. In addition to our suite of development tools, we have developed a set of APIs that we license on a limited basis and through which we can allow third-party providers to access our SDE and to build implementations of their services for delivery through our platform. We believe that this positions us well to extend our platform to emerging consumer Internet sites and services such as social networking.

Custom development.    At times we enter into custom development contracts with certain of our mobile operator customers to enable us to more closely integrate our platform with their networks, or to develop specialized products or software. We may also charge additional fees to our mobile operators to customize our client software to meet their branding specifications prior to deploying a Danger-enabled mobile device.

OEM Partner Relationships

We work closely with our OEM partners to design, manufacture, market and distribute mobile devices that utilize our mobile data services platform. We license our client software to our OEM partners and in turn, they provide industry-leading mobile device technology, device design competencies, sophisticated manufacturing resources and the infrastructure and working capital necessary to support the ordering, inventory and repair requirements of global mobile operators.

We currently have relationships with two OEM partners, Sharp Corporation, or Sharp, and Motorola, Inc., or Motorola. We grant each of our current OEM partners a royalty-free license to distribute our client software and provide them with reference designs to use as the basis for developing Danger-enabled mobile devices. In addition, we work closely with and provide support to our OEM partners through various phases of product design, development and testing to integrate our client software into the Danger-enabled mobile devices that they manufacture. Our close collaboration with our OEM partners yields mobile devices with more tightly-integrated software and services that we believe differentiate Danger-enabled mobile devices from competing smartphones and feature phones. Under our agreements with our OEM partners, the OEMs are responsible for the sales of mobile devices, including providing marketing support to mobile operators and handling warranty returns and

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repairs. Our OEM partners are also responsible for testing Danger-enabled mobile devices with the networks of our mobile operator customers and for obtaining operator, industry and government certifications and approvals that are necessary to commercially launch a mobile device. In addition to our client software, we provide to our OEM partners certain support for obtaining these approvals and certifications. Our OEM partners have agreed to indemnify us for intellectual property claims related to patents that are essential for complying with wireless technology standards and for product liability claims related to Danger-enabled mobile devices. Our OEM partners also agree to pay certain per unit royalties that are due to third parties for the commercial distribution of software that we incorporate into our client software. We, in turn, indemnify our OEM partners for intellectual property claims related to our client software or our SDE.

Sharp Corporation.    Sharp launched its first Danger-enabled mobile device in September 2004 in the United States. Since 2004, Sharp has launched three additional Danger-enabled mobile devices. Pursuant to a master manufacturing and distribution agreement dated April 28, 2004 and subsequently amended, we license to Sharp the right to distribute our client software for the Danger-enabled mobile devices that they have developed. Our agreement with Sharp terminates in April 2008, but will automatically renew for successive one-year periods unless either we or Sharp notifies the other of its intent not to renew. Our agreement with Sharp also allows us or Sharp to terminate the agreement if the other party materially breaches its obligations and fails to cure such breach, or if the other party ceases operations or is subject to bankruptcy proceedings. In addition, if defects in our client software cause Danger-enabled mobile devices manufactured by Sharp to become unusable, we would be obligated to correct the defects and, in certain instances, be required pay for any out-of-pocket costs incurred by Sharp as a result of the defects.

Motorola, Inc.    In September 2006, we entered into a master software license, product development and distribution agreement with Motorola. Motorola’s first Danger-enabled mobile device launched in November 2007 with T-Mobile USA, Inc., or T-Mobile USA, in the United States. Our agreement with Motorola terminates in September 2009, but will automatically renew for successive one-year periods unless either we or Motorola notifies the other of its intent not to renew. Our agreement with Motorola also allows us or Motorola to terminate the agreement if the other party materially breaches its obligations and fails to cure such breach, or if the other party ceases operations or is subject to bankruptcy proceedings. In addition, we agreed to pay Motorola per unit warranty payments in the event certain client software defects thresholds are reached, as well as to take corrective action to cure the defects. Under our agreement with Motorola, if Motorola meets certain performance thresholds, we cannot allow another OEM (subject to limited exceptions) to distribute our client software until one year after Motorola’s first commercial shipment of a Danger-enabled mobile device.

Customers

We sell the Danger solution directly to mobile operators. Our OEM partners sell Danger-enabled mobile devices to mobile operators, and, under separate contractual relationships, we provide mobile data services to our operator customers. Our mobile operator customers bundle the Danger-enabled mobile devices and our mobile data services with an airtime and data plan, and sell the complete solution to their subscribers.

We are substantially dependent on T-Mobile USA for our sales. For the fiscal years ended September 30, 2006 and 2007, T-Mobile USA represented 88.5% and 92.0% of our revenues, respectively, and we expect T-Mobile USA to represent a significant portion of our revenues for the foreseeable future.

We currently provide the Danger solution to the following mobile operator customers in the geographies indicated below:

• North America and the Caribbean: T-Mobile USA, Rogers Communications Inc. (Canada) and Cable and Wireless (Cayman Islands) Ltd.

• Asia: Telstra Corporation Limited (Australia).

• Europe: T-Mobile (UK) Limited, T-Mobile Deutschland GmbH, E-Plus Mobilfunk GmbH (Germany) and T-Mobile Austria GmbH.

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Under our agreements with our mobile operator customers, the mobile operators pay us recurring monthly service fees for each subscriber that is able to access our SDE. Our mobile operator customers also pay us a share of revenue for each premium application, content or service transaction with a subscriber. We record and report on the number of active subscribers and the volume of premium applications, content and service transactions, and electronically deliver these records to our mobile operator customers to enable them to bill their subscribers appropriately. Our mobile operator customers are responsible for billing and collection from subscribers. Our mobile operator customer contracts include service level agreements that set forth the performance standards for our hosted services and give the mobile operators rights to receive credits towards our monthly service fees if the availability of our SDE degrades or our SDE experiences outages that, when measured on a monthly basis, exceed minimum performance thresholds. In addition, our agreements with mobile operator customers provide that we indemnify mobile operator customers for intellectual property claims related to our client software and SDE.

Our current agreement with T-Mobile USA was effective as of June 1, 2005 and expires on December 31, 2008. T-Mobile USA has the right, but not the obligation, to renew our current agreement for a single additional period of up to three years, unless we notify T-Mobile USA of our intent not to renew. Pursuant to our agreement with T-Mobile USA, T-Mobile USA has certain exclusivity rights and rights of first refusal in the United States for new Danger services and mobile device designs owned or controlled by us. Our agreement with T-Mobile USA also allows us or T-Mobile USA to terminate the agreement if the other party materially breaches its obligations and fails to cure such breach. T-Mobile USA also has the right to immediately terminate the agreement in the event of certain breaches by us.

Sales, Marketing and Distribution

We sell the Danger solution directly to mobile operators through an internal sales force and in conjunction with our OEM partners. Our mobile operator customers are the primary source of marketing to consumers and are primarily responsible for generating sales of Danger-enabled mobile devices. Our mobile operator customers employ a variety of marketing programs to sell Danger-enabled mobile devices to consumers, including television, Internet and print advertising, product placement in films and television shows, and celebrity and professional athlete influencer programs. Our current mobile operator customers have generally focused their marketing programs for our solution on young adults and teens, a particularly attractive demographic because of usage of social networking sites and instant messaging platforms by young adults and teens, as well as their ability to influence their peers to adopt mobile data services as a means to participate in these online social interaction activities. We believe that, as mobile use of social networking sites and instant messaging increases, our solution is well positioned to help operators take advantage of the opportunity for mobile data services revenue growth that we believe this demographic presents.

We rely on the extensive distribution channels of our mobile operator customers to expand the adoption of Danger-enabled mobile devices. For example, Danger-enabled mobile devices are sold in T-Mobile USA’s direct channels, such as retail stores and the T-Mobile USA website, as well as indirect channels such as national retail partners, indirect dealers and Internet dealers such as Amazon.com.

Our sales and marketing organizations provide training and channel marketing support to both our mobile operator customers and our OEM partners in order to maximize the effectiveness of their respective sales and distribution channels. We create point-of-sale content and collateral templates and implement selected public relations activities to support the launch of new Danger-enabled mobile devices or new premium applications, content or services. We also selectively sponsor sales incentives programs and contests in conjunction with our OEM partners to encourage the retail and channel sales personnel of our mobile operator customers to sell Danger-enabled mobile devices.

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Technology, Research and Development, and Network Operations

Technology.    Our technology consists of our SDE, which is managed by our data center operations, our client software for mobile devices, and publishing tools and additional server-based software for our premium applications, content and services platform.

Our SDE is the modular and scalable hosted platform that connects Danger-enabled mobile devices to the Internet, converting content and protocols as needed. Our SDE runs on multiple operator-grade service components, including Oracle Corporation RAC (Real Application Clusters) database software, Hitachi, Ltd. SAN (Storage Area Network) storage systems, Cisco Systems, Inc. networking equipment, Sun Microsystems, Inc. database servers and Network Appliance, Inc. file storage systems. Our SDE uses proprietary software to manage each connected Danger-enabled mobile device and to route data traffic among various application proxies and the database. Additional technology load balances the data traffic, providing scalability across multiple collections of application proxies. Our SDE is architected to easily add capacity for subscriber base growth through the addition of individual service elements such as proxy servers or database nodes.

Our client software is a mobile device platform that makes efficient use of processing, memory and power to help reduce mobile device complexity and cost. Our multi-layer client software is comprised of applications, a Java virtual machine, an operating system and libraries that support each of these layers. All applications for Danger-enabled mobile devices are written in the Java programming language to make them easy to develop and easy to port. Our Java virtual machine enables multitasking among various programs at the application layer and interoperates with our SDE allowing the Danger solution to provide improved Java execution performance with reduced processing power and memory usage. We have historically relied on a proprietary operating system, but we are in the process of developing a portable operating system interface, or POSIX, compliant, open source operating system to enable our OEMs and third-party developers to more efficiently work with our platform. Our client software libraries simplify application development and facilitate a consistent user interface across applications developed for our platform.

Our premium applications, content and services platform is comprised of publishing tools and server-based software from the Apache Software Foundation and a Java catalog application on Danger-enabled mobile devices. Our premium applications, content and services are transmitted from our SDE’s database to Danger-enabled mobile devices through our proprietary protocols to ensure secure delivery. Our web servers also interface with our SDE’s billing server to facilitate the transmission of charging records to the billing systems of our mobile operator customers. The Java catalog application on Danger-enabled mobile devices communicates with our server-based software to control the merchandising, previewing, installation and user management of content.

Research and Development.    Our research and development strategy is to continue the development of our SDE, client software and premium applications, content and services platform to deliver the functionality that we expect will drive adoption of our solution. As of September 30, 2007, we had 139 employees on our research and development team and 60 employees on our service engineering and service operations teams. We have also sought to scale our research and development capacity by establishing offshore engineering centers with consulting companies in India, Romania and Ukraine. As of September 30, 2007, we had engaged 39 research and development consultants and six services engineering and operations consultants through these relationships. Our research and development efforts are focused primarily on the following areas:

• improving the functionality, security and performance of our SDE and client software;

• developing new client software for new mobile devices and for current and emerging wireless network technologies;

• abstracting elements of our client software so that we may port our client software and enable our SDE to work with other mobile device platforms;

• developing and scaling our SDE infrastructure to provide the underlying support for our continued growth; and

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• providing a platform and tools for third-party developers to write applications that extend our solution.

Research and development expense, as determined in accordance with accounting principles generally accepted in the United States, was $11.3 million in the year ended September 30, 2005 compared to $17.7 million in the year ended September 30, 2006 and $22.5 million in the year ended September 30, 2007.

Network Operations.    We serve our mobile operator customers from third-party data center facilities located in San Jose, California, which is now operated by Verizon Business Network Services, Inc., or Verizon, following its acquisition of MCI Communications Services. These facilities are secured by around-the-clock security and escort-controlled access, and our service agreement with Verizon requires it to provide us with space as well as redundant systems for power, cooling and Internet connectivity. Under the terms of our service agreement, we occupy two hosting spaces, each in a separate Verizon facility, that are connected by dedicated point-to-point fiberoptic lines. For the first hosting space, our services with Verizon expire on January 1, 2009, but will automatically renew for successive one-year periods unless either we or Verizon notifies the other of its intent not to renew. During any such renewal term, either we or Verizon may terminate the services upon 60 days notice. In the event of a termination of the services or the expiration of the initial or any renewal service term, we have a limited right to extend the services on a month-to-month basis for a maximum of up to six months. For the second hosting space, Verizon has agreed to provide us with services until November 1, 2010, which termination date may not be extended by us absent a subsequent agreement with Verizon. Our service agreement with Verizon also allows us or Verizon to terminate the service agreement if the other party materially breaches its obligations and fails to cure such breach. Verizon also has the right to discontinue providing service to us if Verizon determines that its personnel or facilities are at risk of harm or damage.

In October 2007, we entered into an agreement with an affiliate of Digital Realty Trust, or DRT, for additional hosted data center facilities located in Phoenix, Arizona to accommodate anticipated growth of our mobile data services. We are planning to complete the set up of our DRT facilities to support commercial operation of our SDE by June 1, 2008. These facilities are secured by around-the-clock security and restricted key card access, and the agreement requires DRT to provide us with space as well as power, cooling and access to utilities. This agreement has a 48-month term, but we may exercise an extension option at least nine months prior to the expiration of the initial term, in which case the agreement will be extended for one additional term of 48 months. The agreement with DRT also allows us to terminate the agreement if an interruption of DRT’s services occurs and continues for 30 consecutive days or if three or more 12-hour interruptions of DRT’s services occur within a 12-month period. We also have an agreement for a data center colocation facility in the Netherlands which we could build out to support mobile operator customers in Europe and other international markets.

We continuously monitor and adjust the performance of our SDE. The monitoring features we have built or licensed include centralized performance consoles, automated load distribution tools and various self-diagnostic tools and programs.

Intellectual Property

We seek to protect our technology through a combination of patents, trademarks, copyrights, trade-secrets and contractual arrangements. Our trademarks include Danger and hiptop, which are currently registered in the United States and 20 other countries, as well as with the European Community.

We seek to patent key concepts, components, protocols, processes and other inventions. As of September 30, 2007, we held 34 U.S. patents and eight foreign patents expiring between August 16, 2021 and April 20, 2024, and have 40 U.S. and 47 pending foreign patent applications. These patent and patent applications cover claims associated with features and functionality of our SDE and our client software. Although we apply for patent protection primarily in the United States, we have filed, and will continue to file, patent applications in other countries where there exists a strategic technological or business reason to do so.

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The patent positions of companies in our industry are highly uncertain and involve complex legal and factual questions. As a result, the patents we own and any further patents we may own or license may not prevent other companies from developing similar products or ensure that others will not be issued patents that may prevent the sale of the Danger solution or require licensing and the payment of significant fees or royalties. In addition, we cannot be certain that any of our patent applications will result in issued patents. Furthermore, to the extent that any of our future products, services or methods are not patentable or infringe the patents of third parties, or in the event that our patents or future patents fail to give us an exclusive position in the subject matter claimed by those patents, our business could be adversely affected.

It is our general practice to enter into confidentiality and non-disclosure agreements with our employees, consultants, OEM partners, customers, potential customers and others to attempt to limit access to and distribution of our proprietary information. In addition, we generally enter into agreements with employees and consultants that include an assignment of all intellectual property developed in the course of their employment or service.

We also enter into various types of licensing agreements related to technology and intellectual property rights. We enter into certain of these agreements to obtain rights that may be necessary to produce and sell our products and services. For example, we have an agreement with Sun Microsystems, Inc. under which we license specifications to develop, test and distribute software that we certify as compliant with Sun Microsystems Inc.’s Java standards. These licenses are generally non-exclusive and vary in duration, some having perpetual terms and others requiring renewals after one or more years. We may also license our technology and intellectual property to third parties through various licensing agreements.

Competition

The mobile consumer data services market is highly competitive and subject to rapid change. We believe that the principal criteria that mobile operator customers use in selecting solutions include increased ARPU, perception of mobile device sales potential, subscriber satisfaction, availability of an integrated technology platform, technology architecture, OEM partnerships, content offering, ease of implementation, scalability, customer support, availability of applications, and third-party developer support. While we compete most closely with Research In Motion Limited, an integrated mobile data service provider that markets BlackBerry wireless devices, and with smartphone software providers such as Microsoft Corporation and Symbian Software Limited, we believe that we are the only software-as-a-service platform provider focused primarily on the consumer data services market. In addition to our consumer market focus, other key aspects of our competitive differentiation include our advanced technology architecture, our highly scalable end-to-end mobile data services solution and our managed premium applications, content and services offerings.

We also compete broadly with a significant number of firms that market single elements of our platform, such as Internet services, mobile device operating systems software, mobile device applications, server-based software that delivers content to mobile devices, and content intermediaries. These competitors may in the future create an integrated platform with features similar to ours, such as might result from the Google-led Open Handset Alliance. The Open Handset Alliance, announced in November 2007, is a consortium of more than 30 companies focused on developing an open source software platform for mobile devices. Members of the Open Handset Alliance include mobile operators such as China Mobile Communications Corporation, KDDI Corporation, NTT DoCoMo, Inc., Sprint Nextel, T-Mobile USA, Telecom Italia and Telefónica; and mobile handset manufacturers such as HTC Corporation, LG Electronics, Inc., Motorola and Samsung Electronics, as well as software and mobile computing companies. In addition, some mobile operators have started to develop, either internally or through managed third parties, their own mobile devices, software and services for distribution.

In addition to integrated mobile data service providers and firms that market single elements of our platform, we also face competition from mobile device manufacturers and mobile virtual network operators that

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market devices that compete with Danger-enabled mobile devices. Accordingly, our business is also affected by subscriber adoption of Danger-enabled mobile devices and the competitive factors influencing these decisions, including handset form factor, features, services, brand, price, marketing, styling, product quality and time to market. Although Danger-enabled mobile devices compete primarily with smartphones such as the BlackBerry Pearl, the Palm Treo, the Apple iPhone and the Helio Ocean, certain feature phones with more limited mobile data services capabilities such as the LG Chocolate and the Sony Ericsson Walkman may also compete with Danger-enabled mobile devices.

Seasonality

We experience some seasonality in our business with respect to new subscriber activations in our fiscal first quarter, which ends December 31, reflecting the fact that mobile device sales accelerate in late November and December during the holiday shopping season. The impact of this seasonal activity is generally reflected through a higher sequential quarterly growth rate for monthly service and premium applications, content and services revenues in our fiscal second quarter financial results. In addition to holiday shopping seasonality, we may experience spikes in new subscriber activations and premium applications, content and services revenues as a result of the release of new Danger-enabled mobile device models or new premium applications, content and services.

Employees

As of September 30, 2007, we had 300 employees. Of these employees, 287 were in the United States, 12 were in Europe and one was in Australia. We also engage a number of temporary employees and consultants. None of our employees is represented by labor unions or covered by a collective bargaining agreement. We have not experienced any work stoppages, and we consider our employee relationships to be good.

Facilities

Our headquarters are located in Palo Alto, California, where we lease approximately 58,850 square feet of office space pursuant to leases that expire between December 31, 2009 and December 31, 2011. We lease approximately 5,639 square feet of office space in Duluth, Georgia, and 5,730 square feet in Billerica, Massachusetts pursuant to leases that expire on March 31, 2011 and May 31, 2010, respectively. Internationally, we lease sales office space in Reading, England on a month-to-month basis. We intend to add new facilities and to expand existing facilities as we add employees, and we believe that suitable additional or substitute space will be available as needed to accommodate any such expansion of our operations.

Legal Proceedings

From time to time, we may be subject to legal proceedings and claims in the ordinary course of business. We are not currently a party to any material litigation, however, we have received, and may in the future continue to receive, claims from third parties asserting infringement of their intellectual property rights. For instance, in 2005, a patent holding company filed lawsuits alleging patent infringement and trade secret misappropriation against us, T-Mobile USA, Sharp and an affiliate of Sharp. We incurred expense of approximately $2.7 million in defending ourselves, T-Mobile USA and Sharp before settling the litigation in November 2006. Future litigation may be necessary to defend ourselves, our OEM partners and our mobile operator customers by determining the scope, enforceability and validity of third-party proprietary rights or to establish our proprietary rights.

In addition, we have received, and expect to continue to receive, demands for indemnification from our mobile operator customers and OEM partners, which demands can be very expensive to settle or defend, and we have in the past contributed to settlement amounts and incurred substantial legal fees in connection with certain of these indemnity demands. A number of these indemnity demands, including demands from T-Mobile USA and Sharp, relate to pending litigation and remain outstanding and unresolved as of the date of this prospectus. For example, in October 2007, T-Mobile USA demanded that we indemnify and defend T-Mobile USA against a lawsuit brought by NTP, Inc. alleging that T-Mobile USA is infringing certain patents held by NTP relating to

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the use of wireless communications in electronic mail systems and seeking unspecified damages. NTP is a patent holding company that sued Research in Motion Limited, which markets BlackBerry wireless devices, for patent infringement in 2001, and settled such litigation with Research in Motion Limited in 2006 for $612.5 million. Although NTP’s lawsuit against T-Mobile USA was recently stayed pending the U.S. Patent and Trademark Office’s ongoing review of NTP’s patents, the stay could be lifted at any time. As of the date of this prospectus, we have not accepted or rejected T-Mobile USA’s indemnity demand related to this litigation. Large future indemnity payments and associated legal fees and expenses, including potential indemnity payments and legal fees and expenses relating to T-Mobile USA’s indemnity demand with respect to the NTP lawsuit, could materially harm our business, operating results and financial condition.

Although we have not agreed to defend or indemnify our mobile operator customers or OEM partners for any outstanding and unresolved indemnity demands, we may in the future agree to defend and indemnify them in connection with these demands, irrespective of whether we believe that we have an obligation to indemnify them or whether we believe our solution infringes the asserted intellectual property rights. Alternatively, we may reject certain of our mobile operator customers’ or OEM partners’ indemnity demands, including outstanding demands from T-Mobile USA or Sharp, which rejections may lead to disputes with our mobile operator customers or OEM partners and may negatively impact our relationships with them or result in litigation against us. Our mobile operator customers or OEM partners may also claim that any rejection of their indemnity demands constitutes a material breach of our agreements with them, allowing them to terminate such agreements. If, as a result of indemnity demands, we make substantial payments, our relationships with our mobile operator customers or OEM partners are negatively impacted, or if any of our mobile operator customer or OEM partner agreements is terminated, our business, financial condition and operational results could be materially adversely affected.

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MANAGEMENT

Directors and Executive Officers

The following table sets forth certain information concerning our directors and executive officers as of September 30, 2007:

Name	Age	Position
Executive Officers:
Henry R. Nothhaft	63	Chief Executive Officer and Chairman of the Board of Directors
Joe F. Britt, Jr.	38	Senior Vice President, Chief Technology Officer and Director
Donn Dobkin	46	Senior Vice President of Service Operations
Mark W. Fisher	47	Senior Vice President of Marketing and Business Development
Les Hamilton	63	Senior Vice President of Engineering
Matt Hershenson	40	Senior Vice President of Advanced Products
Nancy J. Hilker	50	Senior Vice President and Chief Financial Officer
James L. Isaacs	47	Senior Vice President of Worldwide Sales and Alliances
Sandra J. Taylor	45	Vice President of Finance, Controller and Chief Accounting Officer
Non-Employee Directors:
Jeffrey D. Brody(1)(2)	47	Director
Gregory P. Galanos(2)(3)	50	Director
Richard S. Gilbert(3)(4)	55	Director
Eric Hippeau(1)(2)(3)	56	Director
Albert A. “Rocky” Pimentel(1)(3)	52	Director

(1) Member of our audit committee

(2) Member of our compensation committee

(3) Member of our nominating and corporate governance committee

(4) Lead independent director

Executive Officers

Henry R. Nothhaft has served as our Chief Executive Officer and Chairman of the Board of Directors since October 2002. Prior to joining us, Mr. Nothhaft served as the Chief Executive Officer of Endforce, Inc., an Internet protocol services software company, from May 2001 to October 2002, and continued to serve as the non-executive Chairman of the board of directors of Endforce from October 2002 to March 2005. From July 2000 to April 2001, Mr. Nothhaft served as Vice Chairman of the board of directors of XO Communications, Inc., a telecommunications services provider. From May 1995 to June 2000, Mr. Nothhaft served as Chairman, President and Chief Executive Officer of Concentric Network Corporation, a national Internet service provider that merged with Nexlink Communications in June 2000 and subsequently became XO Communications. Mr. Nothhaft currently serves on the board of directors of Tessera, Inc., a developer of semiconductor packaging technology. Mr. Nothhaft holds an M.B.A. from George Washington University and a B.S. with distinction from the United States Naval Academy, and he is a former officer in the United States Marine Corps.

Joe F. Britt, Jr. has served as our Senior Vice President and Chief Technology Officer and as a member of our board of directors since he co-founded us in December 1999. From July 1995 through December 1999, Mr. Britt served as a Senior Software Engineer at WebTV Networks, an Internet device and services company, which was acquired by Microsoft Corporation in 1997. Prior to joining WebTV, Mr. Britt served as a Senior Software Engineer at Catapult Entertainment, a video-game development company, from June 1994 to July 1995. Prior to Catapult, Mr. Britt worked as a Software Engineer at the 3DO Company, a video-game development company, from October 1993 to June 1994. His first job in Silicon Valley was as a Software Engineer at Apple Computer from January 1992 to October 1993. Mr. Britt graduated from the North Carolina School of Science and Mathematics, and holds a B.S. in Computer Engineering from North Carolina State University.

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Donn Dobkin has served as our Senior Vice President of Service Operations since December 2006, served as our Vice President, Service Operations from January 2005 to December 2006, and served as a consultant with us from December 2003 to December 2004. Prior to joining us, Mr. Dobkin was in photography school from May 2003 to November 2003. From June 2000 to April 2003, Mr. Dobkin held various roles at XO Communications, including Vice President of Software Engineering and Operations, and most recently, Vice President and General Manager of the Hosting Business Unit. Prior to the merger of Nexlink Communications and Concentric Network Corporation, from which XO Communications was formed, Mr. Dobkin served as Director of Finance at Concentric Network Corporation from February 1996 to March 1999, and then served as Chief Information Officer and Vice President of Software Engineering from March 1999 to June 2000. He holds a B.A. in Business-Economics from the University of California, Santa Barbara.

Mark W. Fisher has served as our Senior Vice President of Marketing and Business Development since September 2003 and was a consultant for us from May 2003 to August 2003. From June 2000 to April 2003, Mr. Fisher served as Senior Vice President of Marketing at XO Communications. Prior to the merger of Nexlink Communications and Concentric Network Corporation, from which XO Communications was formed, Mr. Fisher served as Senior Vice President of Marketing at Concentric Network Corporation, from June 1997 through June 2000. Mr. Fisher holds an M.B.A. from the Haas School of Business at the University of California at Berkeley and a B.S. in Engineering from the United States Naval Academy.

Les Hamilton has served as our Senior Vice President of Engineering since August 2005, and served as our Senior Vice President of Worldwide Operations from December 2002 to August 2005. From April 2002 to November 2002, Mr. Hamilton served as Senior Vice President of Network Services for GX Networks UK Ltd., a spin-off of XO Communications Europe. Prior to assuming his position at GX Networks, Mr. Hamilton served as Senior Vice President of Network and Systems at XO Communications Europe from June 2000 to March 2002. Prior to the merger of Nexlink Communications and Concentric Network Corporation, from which XO Communications was formed, Mr. Hamilton served as the Senior Vice President of Engineering and Operations at Concentric Network Corporation from April 1999 to June 2000. From 1996 to 1999, Mr. Hamilton served as Vice President of Network Services at Infonet Service Corporation, a global communications services company. Mr. Hamilton holds an M.B.A. from the Peter F. Drucker Graduate School in Claremont, California and a B.S. in Mechanical Engineering from Teesside University in the United Kingdom.

Matt Hershenson has served as our Senior Vice President of Advanced Products since he co-founded us in December 1999. From August 1998 to November 1999, Mr. Hershenson managed the hardware group at Mainbrace Corporation, a Windows CE systems integrator. Prior to joining Mainbrace, Mr. Hershenson served in various roles at Philips Corporation, from February 1996 to August 1998, including leading the hardware development of the Philips Velo at Philips Electronics and as a System Architect for Philips Handheld Computing Group at Philips Semiconductors. Mr. Hershenson studied physics at the University of Michigan in Ann Arbor.

Nancy J. Hilker has been our Senior Vice President and Chief Financial Officer since December 2006, and served as our Vice President of Finance and Chief Financial Officer from August 2002 to November 2006. Prior to joining us, Ms. Hilker was Senior Vice President and Chief Financial Officer of Liberate Technologies, a software for information appliances company, where she served in various positions from August 1997 to August 2002. Prior to joining Liberate Technologies, Ms. Hilker served as Vice President and Secretary of Navio, Inc., a software for information appliances company, from July 1996 until Navio’s acquisition by Liberate Technologies in August 1997. Ms. Hilker holds a B.S. in Business Administration from California Polytechnic State University, San Luis Obispo and is a Certified Public Accountant.

James L. Isaacs has been our Senior Vice President of Worldwide Sales and Alliances since October 2006, and served as our Vice President of Sales from November 2002 to September 2006. From June 2000 to October 2002, Mr. Isaacs served as a Vice President at XO Communications. Prior to the merger of Nexlink Communications and Concentric Network Corporation, from which XO Communications was formed, Mr. Isaacs served in various positions at Concentric Network Corporation, including as Vice President of Business

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Development, from June 1997 through June 2000. Mr. Isaacs holds an M.B.A. from the Haas School of Business at the University of California at Berkeley and an A.B. in International Relations from Stanford University.

Sandra J. Taylor has served as our Vice President of Finance, Controller and Chief Accounting Officer since October 2006 and as our Controller from February 2004 to September 2006. Ms. Taylor served as Vice President, Finance and Operations at Respond Networks, Inc. a lead management company, from January 2000 to January 2003, and served as Secretary and Treasurer from January 2001 to January 2003, after which she took a year off before joining us. Prior to joining Respond Networks, Ms. Taylor served as Director of Finance and Strategic Planning at Oracle Corporation, a software company, from 1997 to January 2000. Ms. Taylor holds a B.B.A. from The University of New Mexico and is a Certified Public Accountant.

Non-Employee Directors

Jeffrey D. Brody has served as a member of our board of directors since July 2001. Mr. Brody currently serves as Managing Director of Redpoint Ventures, a venture capital firm, which he co-founded in October 1999. Mr. Brody holds an M.B.A. from Stanford Graduate School of Business and a B.S. in Mechanical Engineering from the University of California at Berkeley.

Gregory P. Galanos has served as a member of our board of directors since December 2000. Mr. Galanos has served as a Managing Director for Mobius Venture Capital, a venture capital firm, since May 2000. He holds an M.S. in Computer Science from l’Université du Quebec à Montreal.

Richard S. Gilbert has served as a member of our board of directors since August 2007. Mr. Gilbert has served as the President and Chief Executive Officer of Kineto Wireless, Inc., a wireless technology company, since June 2005. Prior to joining Kineto, Mr. Gilbert was the Chairman and Chief Executive Officer of Copper Mountain Networks, Inc., a provider of broadband access products, from April 1998 to May 2005. Mr. Gilbert holds an M.S. in Computer Science from Stanford University and a B.S. in Mathematics from the University of California at Berkeley.

Eric Hippeau has served as a member of our board of directors since January 2003. Mr. Hippeau has served as a Managing Partner of SOFTBANK Capital Partners, a venture capital firm, since November 2001. From March 2000 to November 2001, Mr. Hippeau served as President and Executive Managing Director of SOFTBANK International Ventures, an international venture capital firm and affiliate of SOFTBANK. Prior to joining SOFTBANK, Mr. Hippeau served in various roles at Ziff Davis Publishing Inc., a publishing company, including Chairman and Chief Executive Officer from 1993 until October 2000. Mr. Hippeau also sits on the board of directors of Yahoo! Inc. and Starwood Hotels and Resorts Worldwide, Inc.

Albert A. “Rocky” Pimentel has served as a member of our board of directors since August 2007. Mr. Pimentel has served as the Executive Vice President and Chief Financial Officer of Glu Mobile, Inc., a provider of mobile games, since October 2004. Prior to joining Glu Mobile, Inc., Mr. Pimentel served as Executive Vice President and Chief Financial Officer of Zone Labs, Inc., an end-point security software company, from September 2003 until it was acquired in April 2004 by Checkpoint Software, Inc. From January 2001 to June 2003, he served as a Partner of Redpoint Ventures, a venture capital firm. Mr. Pimentel holds a B.S. in Commerce from Santa Clara University and is a Certified Public Accountant.

Board of Directors

Our board of directors currently consists of seven members, comprised of five non-employee members, our current Chief Executive Officer, and our current Senior Vice President and Chief Technology Officer.

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Effective upon the completion of this offering, we will divide our board of directors into three classes, as follows:

• Class I, which will consist of Messrs. Brody and Nothhaft, and whose term will expire at our annual meeting of stockholders to be held in 2009;

• Class II, which will consist of Messrs. Britt and Hippeau, and whose term will expire at our annual meeting of stockholders to be held in 2010; and

• Class III, which will consist of Messrs. Galanos, Gilbert and Pimentel, and whose term will expire at our annual meeting of stockholders to be held in 2011.

At each annual meeting of stockholders to be held after the initial classification, the successors to directors whose terms then expire will serve until their successors are duly elected and qualified at the third annual meeting following their election. The authorized number of directors may be changed only by resolution of the board of directors. This classification of the board of directors may have the effect of delaying or preventing changes in our control or management. Under Delaware law, our directors may be removed for cause by the affirmative vote of the holders of a majority of our voting stock.

Pursuant to a voting agreement, recently amended in October 2006, by and among us and certain of our preferred and common stockholders, Messrs. Nothhaft, Britt, Brody, Galanos and Hippeau were each elected to serve as members on our board of directors and, as of the date of this prospectus, continue to so serve. The voting agreement and all rights thereunder will automatically terminate upon completion of this offering, and members previously elected to our board of directors pursuant to the voting agreement will continue to serve as directors until their successors are duly elected by holders of our common stock.

Director Independence

Our board of directors undertook a review of the independence of each director and considered whether any director has a material relationship with us that could compromise his ability to exercise independent judgment in carrying out his responsibilities. As a result of this review, our board of directors has determined that all of our directors, other than Mr. Nothhaft and Mr. Britt, are “independent” within the meaning of applicable NASDAQ listing standards, constituting a majority of independent directors of our board of directors as required by NASDAQ listing standards.

Committees of the Board of Directors

Our board of directors currently has an audit committee, a compensation committee and a nominating and corporate governance committee. The composition and primary responsibilities of each committee are described below. Our board of directors may establish other committees to facilitate the management of our business.

Audit Committee.     The members of our audit committee are Messrs. Brody, Hippeau and Pimentel. Mr. Pimentel chairs the audit committee. Our board of directors has determined that all of these members, other than             , meet the independence requirements of Rule 10A-3 of the Securities Exchange Act of 1934, as amended, and NASDAQ listing standards. Our board of directors has also determined that Mr. Pimentel qualifies as an audit committee financial expert within the meaning of SEC regulations and the NASDAQ listing standards. In making this determination, our board of directors considered the nature and scope of experience Mr. Pimentel has had with reporting companies and his employment in the corporate finance sector.

The primary purpose of the audit committee is to discharge the responsibilities of our board of directors with respect to our accounting and financial reporting processes, our internal control over financial reporting processes and audits of financial statements, and to oversee the performance and independence of our independent registered public accounting firm. Specific responsibilities of our audit committee include:

• evaluating the performance of our independent registered public accounting firm and determining whether to retain or terminate their services;

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• determining and pre-approving the engagement of our independent registered public accounting firm to perform audit services and any permissible non-audit services, other than immaterial aggregate amounts of non-audit services as excepted under applicable laws and rules;

• monitoring the rotation of the partners of the independent registered public accounting firm;

• reviewing and discussing with management and our independent registered public accounting firm the results of the annual audit and the independent registered public accounting firm’s review of our annual and quarterly financial statements and reports;

• reviewing with management and our independent registered public accounting firm significant issues that arise regarding accounting principles and financial statement presentation;

• reviewing and approving related-party transactions;

• conferring with management and our independent registered public accounting firm regarding the scope, adequacy and effectiveness of our internal control over financial reporting; and

• establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting control or auditing matters.

Compensation Committee.     The members of our compensation committee are Messrs. Brody, Galanos and Hippeau. Mr. Brody chairs the compensation committee. Our board of directors has determined that all of these members meet the independence requirements of the NASDAQ listing standards. The purpose of our compensation committee is to discharge the responsibilities of our board of directors to oversee our compensation policies, plans and programs and to review and determine the compensation to be paid to our executive officers and other senior management. Specific responsibilities of our compensation committee include:

• recommending to our board of directors for approval the compensation and other terms of employment of our Chief Executive Officer;

• determining the compensation and other terms of employment of our other executive officers and senior management;

• reviewing and approving corporate performance goals and objectives relevant to the compensation of our executive officers and other senior management;

• evaluating and recommending to our board of directors the compensation plans and programs advisable for us, and evaluating and recommending the modification or termination of existing plans and programs; and

• reviewing and approving the terms of any employment agreements, severance arrangements, change-of-control protections and any other compensatory arrangements for our executive officers and other senior management.

Nominating and Corporate Governance Committee.     Currently, the members of our nominating and corporate governance committee are Messrs. Galanos, Gilbert, Hippeau and Pimentel. Mr. Gilbert chairs the nominating and corporate governance committee. Each member of the nominating and corporate governance committee is independent within the meaning of applicable NASDAQ listing standards. The specific responsibilities of our nominating and corporate governance committee include:

• identifying, reviewing, evaluating and recommending for selection candidates for membership to our board of directors;

• reviewing, evaluating and considering the recommendation for nomination of incumbent members of our board of directors for reelection and monitoring the size of our board of directors;

• evaluating nominations by stockholders of candidates for election to our board of directors;

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• reviewing, discussing and assessing the performance of our board of directors;

• reviewing and recommending to our board of directors the compensation to be paid or awarded to our directors; and

• determining adherence to our corporate governance documents.

Compensation Committee Interlocks and Insider Participation

During the year ended September 30, 2007, our compensation committee consisted of Messrs. Brody, Galanos and Gilbert. Mr. Gilbert was replaced by Mr. Hippeau on our compensation committee in December 2007. Please see the disclosure regarding a potential transaction with Kineto Wireless, Inc., of which Mr. Gilbert is the President and Chief Executive Officer, in “Certain Relationships and Related Party Transactions —Transactions with Entities Affiliated with Directors.” None of the members of the compensation committee is currently or has been at any time one of our officers or employees. None of our officers currently serve, nor have served during the last completed fiscal year, as a member of the board of directors or compensation committee of any entity that has one or more officers serving as a member of our board of directors or compensation committee.

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EXECUTIVE AND DIRECTOR COMPENSATION

Executive Compensation

Compensation Discussion and Analysis

Overview.    Our executive compensation program is designed to help us attract, as needed, talented individuals to manage and operate all aspects of our business, to reward those individuals fairly over time, and to retain those individuals who continue to meet our expectations and support the achievement of our strategic business objectives. The primary goals of our executive compensation program are to provide:

• a compensation package that will attract, motivate, retain and reward exceptional executives whose knowledge, skills and performance are critical to achieving our strategic business objectives;

• compensation parity among our executive team; and

• long-term equity incentives to build a sustainable company by retaining employees with key skills.

To achieve the above goals, our compensation committee recommends executive compensation packages to our board of directors that primarily consist of annual base salary and equity awards, and, with respect to James L. Isaacs, our Senior Vice President of Worldwide Sales and Alliances, cash incentive payments under our sales commission incentive plans. Our compensation committee has not adopted any formal guidelines for allocating total compensation between equity compensation and cash compensation, but generally seeks to provide an overall executive compensation package designed to attract, motivate and retain high-quality executives and to reflect our philosophy of maintaining compensation parity among our executive team.

Role of the Compensation Committee in Setting Executive Compensation

Our compensation committee approves our overall compensation strategy and policies, and reviews, determines and recommends to our board of directors for approval, the compensation to be paid to our executive officers and other senior management. In establishing our compensation philosophy and determining executive cash and equity compensation, our compensation committee considers recommendations from Henry R. Nothhaft, our Chief Executive Officer. While Mr. Nothhaft discusses his recommendations with our compensation committee, he does not participate in determining his own compensation. However, in May 2007, Mr. Nothhaft did meet with our compensation committee to provide the compensation committee with his input on the severance and change in control terms of a new employment agreement that we negotiated and entered into with Mr. Nothhaft in June 2007 as explained in more detail below. In making his compensation recommendations for our other executive officers, Mr. Nothhaft receives input from our Senior Director of Human Resources based, in part, on analyses of third-party compensation surveys and compensation data. This information is made available to Mr. Nothhaft and is also made available to our compensation committee. Our Senior Director of Human Resources and Nancy J. Hilker, our Chief Financial Officer, have historically participated in compensation committee meetings, and have from time to time been asked for input and/or recommendations by our compensation committee. None of our other executive officers participate in the compensation committee’s executive compensation discussions or decisions. Our compensation committee does not delegate any of its functions to others in determining executive compensation. As explained below, however, Mr. Nothhaft and either Ms. Hilker or Sandra Taylor, our Vice President of Finance and Controller, determine, in consultation with Mr. Isaacs, certain quarterly sales objective targets and certain management by objective, or MBO, milestones under our annual sales commission incentive plans.

Our compensation committee has engaged consultants with respect to executive compensation matters and anticipates continuing to utilize external compensation consultants from time to time. As discussed below, our compensation committee has retained Compensia Inc., a consulting firm specializing in executive compensation advisory services, to provide evaluations and recommendations for our equity compensation program. We also retained Compensia to analyze and make recommendations with respect to the severance and change in control terms of the new employment agreement that we entered into with Mr. Nothhaft in June 2007.

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Benchmarking of Cash and Equity Compensation

Historically, our compensation committee has considered several different data sources in determining our annual cash and equity compensation. These sources included:

• input from other independent members of our board of directors, based on general experience with companies in their investment portfolio;

• compensation surveys, such as the Radford/AON Quarterly Summary of Industry Trends survey, the annual Venture Capital Executive Compensation Survey and the Radford/AON Executive Benchmark Survey; and

• external compensation consultants.

In evaluating executive base salaries for the year ended September 30, 2007, we used two private company executive salary surveys as our source for benchmark salary data: the Syzygy Consulting Group Pre-IPO and Private Company Total Compensation Survey, or the Syzygy survey, and the Venture Capital Executive Compensation Survey—Privately Held Information Technology Companies, or the Venture Capital survey. The Syzygy survey, administered annually since 1999, is conducted in association with leading national law firms and measures total cash and stock compensation data for boards of directors, chief executive officers and other executives at more than 150 privately held high-technology companies in the United States. From the total sample size, we filtered the companies from which we benchmarked salary data by reviewing salary data from privately held software companies participating in the Syzygy survey. The Venture Capital survey, sponsored by several venture capital funds including Accel Partners, Benchmark Capital, Redpoint Ventures and Mobius Venture Capital, surveys approximately 550 privately held information technology companies. From the total sample size, we filtered the companies from which we benchmarked salary data by reviewing salary data from privately held communication software and services companies participating in the Venture Capital survey that were located in the San Francisco Bay Area and that had commercial product sales.

In July 2007, upon the recommendation of our Senior Director of Human Resources, our compensation committee approved the purchase of the Radford/AON Executive Benchmark Survey, or the Radford executive survey, which we used as our source for benchmark salary data for evaluating our named executive officers’ base salaries for the year ending September 30, 2008. The Radford executive survey provides competitive and current benchmark data for vice president positions and above. More than 700 companies in the United States in a wide range of technology industries participate in the survey. The Radford executive survey is updated quarterly and provides comparable company compensation data that can be analyzed by technology sector, geographic location, annual revenue and headcount. From the total sample size, we filtered the companies from which we benchmarked salary data by reviewing salary data from public and privately held companies participating in the Radford executive survey that were located in Northern California and that had annual revenues of under $200.0 million. We do not limit our base salary benchmark data to companies of similar size and business model since we believe that we must evaluate the compensation that we offer, not only against that of companies of similar size and business model, but also against that of companies that rely on the same talent skills that we need to achieve our strategic business objectives, particularly due to the fact that the Silicon Valley is a very competitive geographic market for talent.

Our compensation committee also utilizes the Radford/AON Quarterly Summary of Industry Trends, or Radford QSIT survey, in determining our company-wide “focal” budgets for company-wide salary increases as described in more detail under “—Elements of Compensation—Base Salary” below. The Radford QSIT survey provides quarterly expenditure and budget data for base salary increases across executive and non-executive positions. The Radford QSIT survey is comprised of data gathered from approximately 700 technology companies in the United States. From the total sample size, our compensation committee reviewed expenditure and budget data from companies participating in the Radford QSIT survey that were located in Northern California in determining our company-wide focal budgets for each of the year ended September 30, 2007 and the year ending September 30, 2008.

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In February 2006 and March 2007, we retained Compensia to evaluate and make recommendations for our equity compensation program, including with respect to percentage ownership in our company by our executive officers. Compensia compared our executive stock option ownership to benchmark market data from the Dow Jones & Company CompensationPro database and the Advanced-HR, Inc. Option Impact database which each survey private, high-technology companies in the United States. The Dow Jones & Company survey collects data from over 700 privately held companies and the Advanced-HR, Inc. survey collects data from approximately 200 private, venture capital funded companies.

Elements of Compensation

Our executive compensation program consists of the following principal components: base salary, long-term incentive compensation in the form of stock option awards, benefit plans generally available to all employees, change in control and other severance benefits, certain perquisites for our Chief Executive Officer, and, in the case of Mr. Isaacs, sales commission incentive plans. Each component of compensation is evaluated based on the factors discussed in each section below. Given the different purposes of each element of compensation, determinations by our compensation committee with respect to one element of compensation do not generally influence decisions by the committee with respect to other elements. However, in the case of Mr. Isaacs, the determination of Mr. Isaacs’ base salary is based, in part, on the cash incentive compensation that he is eligible to receive under our sales commission incentive plans.

Base Salary.     Base salaries for our executive officers are determined in large part based on base salary parity among our executive team and on our target market positions for executive base salaries as explained in more detail below. Base salaries are also determined, in part, by the company-wide “focal” budget that our compensation committee approves each year for company-wide salary increases. Each company-wide focal budget is based on our financial performance in the prior fiscal year as well as the benchmark budgeting data we obtain from the Radford QSIT survey. Since our compensation committee believes that an important goal of our executive compensation program is to promote compensation parity among the executive team, we do not generally tie base salaries to individual performance in the prior year, but rather, as a result of our focal budgeting process, we believe that our executive base salaries reflect our performance in achieving our corporate goals for the prior year. With respect to our compensation parity goal, the purpose underlying this goal is to foster an environment of teamwork, collaboration and collegiality, as well as to promote a focus on company goals rather than on individual goals.

At the beginning of each of the year ended September 30, 2007 and the year ending September 30, 2008, our compensation committee recommended, and our board of directors approved, the base salaries for our named executive officers as set forth in the table below. In recommending these salaries, our compensation committee took into account a number of factors, including pay parity among the executive officers, benchmark salary data, and, primarily with respect to Mr. Nothhaft and Mr. Isaacs, the executive’s seniority, position and functional role and level of responsibility. Our compensation committee also determined the proposed salaries of the executive team in light of the respective company-wide focal budgets approved by our compensation committee for each upcoming fiscal year. After setting a company-wide focal budget based on benchmark budgeting data from the Radford QSIT survey and our financial performance in the prior fiscal year, our compensation committee determined an appropriate increase in executive base salaries from the prior fiscal year and then evaluated the proposed salaries against our benchmark salary data. To perpetuate our base salary parity goal, each of our named executive officers, except for Mr. Nothhaft and Mr. Isaacs, has the same base salary and received the same percentage raise for the year ended September 30, 2007 and the year ending September 30, 2008. Mr. Isaacs has a smaller base salary and received a smaller percentage raise in the year ended September 30, 2007 because he is the only executive officer that participates in our sales commission incentive plans. Although Mr. Nothhaft’s percentage raises in the year ended September 30, 2007 and the year ending September 30, 2008 were the same as the rest of the named executive officer group, his base salary level is higher than the rest of the named executive group due to our compensation committee’s belief that he should be compensated at a higher level than the rest of the executive team given his status as our most senior officer and the critical role he plays in helping to achieve our strategic business objectives.

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For the year ended September 30, 2007, our Senior Director of Human Resources reviewed with our compensation committee the Radford QSIT survey for the second quarter of 2006, which indicated that technology companies in Northern California participating in the Radford QSIT survey were, on average, budgeting approximately 4.7% to accommodate company-wide salary increases based on merit, promotions and market adjustments. Based on this information, together with our focal budgeting process referred to above, our compensation committee determined that a 4.3% increase in our named executive officers’ base salaries, other than Mr. Isaacs, was appropriate. The compensation committee then reviewed the Syzygy survey and the Venture Capital survey, using the filtering criteria described above, and found that each of our named executive officer’s proposed salaries fell within the 50^th percentile of the Syzygy survey results and between the median and the third quartile of the Venture Capital survey results. Although our compensation committee did not target these ranges prior to determining our named executive officers’ base salaries for the year ended September 30, 2007, our compensation committee determined that the proposed base salaries were appropriate in light of the results yielded by the comparison to the benchmark salary data and were consistent with our goal of providing a competitive compensation package. In other words, our compensation committee felt that since the base salaries generally fell close to the 50^th percentile of the Syzygy survey and between the median and the quartile of the Venture Capital survey, our objective of offering competitive base salaries to attract, motivate and retain qualified employees had been met.

For proposed base salaries for the year ending September 30, 2008, although our compensation committee determined the named executive officers’ base salary increases in the same way as the salary increases for the year ended September 30, 2007, the committee used a different methodology and different benchmarking data for evaluating the proposed salaries. As in the prior year, our Senior Director of Human Resources reviewed with our compensation committee the Radford QSIT survey for the second quarter of 2007, which indicated that technology companies in Northern California participating in the Radford QSIT survey were, on average, budgeting approximately 4.4% to accommodate company-wide salary increases based on merit, promotions and market adjustments. Based on this information, together with our focal budgeting process referred to above and the fact that we had not yet achieved cash flow break-even, our compensation committee determined that a 3.5% increase in our named executive officers’ base salaries was appropriate. For purposes of evaluating the proposed base salaries, our compensation committee approved the purchase of the Radford executive survey and also adopted the use of compensation ratios, or compa-ratios, to more systematically index, measure and benchmark our named executive officers’ base salaries. To measure and evaluate compa-ratios, our compensation committee chose a target level for base salaries that is expressed as a percentile of the benchmark salary data derived from the Radford executive survey. Our compensation committee chose to target the 60^th percentile in an attempt to strike a balance between our objective of offering competitive base salaries to attract, motivate and retain qualified employees and our objective as a private company to minimize cash expenditures. In addition, our compensation committee believed that the 60^th percentile was as low a percentile as we could target while still remaining competitive in our talent markets, particularly since we do not generally offer other cash incentives to our executive officers such as an annual cash bonus program. Our compensation committee recommended and our board of directors also approved a range for employee base salaries between 85% and 115% of the 60^th percentile to provide us with flexibility in offering base salaries to attract qualified employees while at the same time providing consistency in our base salary program. Since the target range is a guideline, our compensation committee may deviate from the target range in certain cases in order to further our compensation goals, such as pay parity among the executive officers. During its determination of salaries for the year ending September 30, 2008, our compensation committee also examined the historical compa-ratios of our named executive officers’ base salaries for the year ended September 30, 2007 to use as a baseline for the new data and compa-ratio methodology, which historical compa-ratios are set forth in the table below. Because we have emphasized pay parity among the executive officers, the compa-ratio’s for the named executive officers are spread throughout the 85% to 115% range, and, in Mr. Hershenson’s case, the compensation committee determined that maintaining pay parity among our executive team justified Mr. Hershenson’s compa-ratio for the year ending September 30, 2008 exceeding the authorized range. Mr. Hershenson’s compa-ratio for the year ended September 30, 2007 also exceeded the authorized range, but since the compensation committee had not yet adopted the use of compa-ratios for evaluating proposed salaries, our compensation committee did not consider Mr. Hershenson’s compa-

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ratio in evaluating his proposed base salary for the year ended September 30, 2007. Mr. Isaacs’ compa-ratio is below the 85% to 115% compa-ratio range because he is the only executive officer that participates in our sales commission incentive plans.

	Year Ended September 30, 2007			Year Ending September 30, 2008
Name and Principal Position	Base Salary ($)	Increase from Prior Year (%)	Compa-Ratio (%)	Base Salary ($)	Increase from Prior Year (%)	Compa-Ratio (%)
Henry R. Nothhaft Chief Executive Officer and Chairman of the Board of Directors	433,888	4.3	111	449,074	3.5	115
Nancy J. Hilker Senior Vice President and Chief Financial Officer	241,377	4.3	94	249,825	3.5	97
Joe F. Britt, Jr. Senior Vice President and Chief Technology Officer	241,377	4.3	110	249,825	3.5	114
Mark W. Fisher Senior Vice President of Marketing and Business Development	241,377	4.3	100	249,825	3.5	103
Matt Hershenson Senior Vice President of Advanced Products	241,377	4.3	116	249,825	3.5	120
James L. Isaacs Senior Vice President of Worldwide Sales and Alliances	201,502	4.0	80	208,554	3.5	83

Other Cash Incentive or Bonus Programs.    Other than with respect to our sales commission incentive plans, we do not maintain any cash incentive or other bonus programs for our executive officers. Our compensation committee believes that, in our current stage of growth, our long term equity incentive program provides our executive officers with a sufficient link between the achievement of our long-term corporate goals and total compensation. We have also determined not to establish a cash incentive or other bonus program because we are not yet profitable. However, because our sales efforts are directly linked to our financial performance and the achievement of overall corporate goals, our compensation committee believes that a portion of Mr. Isaacs’s total cash compensation should be performance-based, and, accordingly, he is the only named executive officer that participates in our sales commission incentive plans. After this offering, our compensation committee may recommend implementing cash incentive or other bonus programs for our executive team to create direct links between total compensation and the achievement of individual and corporate goals and objectives.

Sales Commission Incentive Plans.    At the beginning of each calendar year, our compensation committee approves a U.S. sales commission incentive plan to encourage and reward members of our sales team for their efforts in securing and expanding revenue-generating relationships for us during the calendar year. Because we determine our annual business plan on a calendar year basis and we base the sales objective targets under our sales commission incentive plans on our annual business plans, we operate our sales commission incentive plans on a calendar year basis. Under each sales commission incentive plan, sales objective targets and certain MBO milestones, such as signing an agreement with a new mobile operator customer, are determined on a quarterly basis by Mr. Nothhaft and either Ms. Hilker or Ms. Taylor in consultation with Mr. Isaacs. As mentioned above, quarterly sales objective targets are based in large part on our sales objectives as set forth in our annual business plan that is approved by our board of directors. Quarterly MBO milestones are based in large part on our

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performance in meeting our sales objectives for the prior quarter. For the year ended December 31, 2006, the amount of a participant’s commission was determined by the achievement of billed monthly services revenue targets and certain MBO milestones. For the year ended December 31, 2007, the amount of a participant’s commission was determined by the achievement of billed monthly services revenue, gross new subscriber addition and end of quarter subscriber targets, as well as certain MBO milestones. For the year ended December 31, 2007, our compensation committee approved the addition of gross new subscriber addition and end of quarter subscriber objectives in part given our move in the year ended December 31, 2007 to a more metric driven sales commission structure, and in part since we believed that the addition of these objectives more accurately measured subscriber growth than relying on billed monthly services revenue targets alone.

For the year ended September 30, 2007, Mr. Isaacs was our only executive officer that was eligible to participate in our sales commission incentive plans. For each of the years ended December 31, 2006 and December 31, 2007, Mr. Isaacs’ target commission was set at approximately $27,500 per quarter, or $110,000 annually, with no minimum commission and the maximum commission set at $165,000, or 150% of the target commission. Mr. Isaacs’s annual target commission of $110,000 was negotiated as part of his compensation package when he joined us. Under the sales commission incentive plan for the three months ended December 31, 2006, Mr. Isaacs’ target commission was $15,057 for achieving the billed monthly services revenue target and $12,215 for the achievement of certain MBO milestones. Under the sales commission incentive plan for the year ended December 31, 2007, Mr. Isaacs’ quarterly commission was determined as follows:

Objectives(1)	Quarterly Target Commission		Percentage of Total Quarterly Target
Gross new subscriber additions(2)	$	5,500	20	%
End of quarter subscribers(3)		6,875	25
Billed monthly services revenue(4)		6,875	25
MBO milestones(5)		8,250	30
Total	$	27,500	100	%

(1) For each quarter being calculated, if the actual gross new subscriber additions, end of quarter subscribers and billed monthly services revenue, respectively, are (i) less than 75% of the respective target, Mr. Isaacs would not be entitled to a payout for the respective objective; (ii) between 75% and 100% of the respective target, the payout to Mr. Isaacs would be determined on a pro-rata basis (i.e., by multiplying the applicable percentage obtained by the target commission for the respective objective); (iii) greater than 100% and less than 150% of the respective target, the payout to Mr. Isaacs would be the pro rata of 120% of the value of the target commission for the respective objective; and (iv) greater than 150% of the respective target, the payout to Mr. Isaacs would be 150% of the value of the target commission for the respective objective. Commissions for the achievement of MBO milestones are awarded on an as-achieved basis.

(2) Defined as a target number of new subscribers that are activated for access to our mobile data services during the applicable quarter.

(3) Defined as a target number of subscribers able to access our mobile data services as of the last day of the applicable quarter.

(4) Defined as a target monthly amount of revenue billed to our operator customers during the applicable quarter.

(5) MBO milestones include specified objectives determined on a quarterly basis by Mr. Nothhaft and either Ms. Hilker or Ms. Taylor in consultation with Mr. Isaacs.

The quarterly targets for the gross new subscriber additions, end of quarter subscribers and billed monthly services revenue objectives are based in part on our sales objectives as set forth in our annual business plan that is approved by our board of directors and reflect our own internal planning for each quarter during the calendar year. Accordingly, each quarter, our expectation is that we will achieve 100% of the respective target and that therefore, Mr. Isaacs will achieve 100% of the quarterly target commission for each of these objectives. Historically, however, Mr. Isaacs has achieved less than 100% of the quarterly target commission for these

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objectives. At the other end of the spectrum, we believe that it would be very difficult for Mr. Isaacs to achieve 150% of the quarterly target commission for each of these objectives since this would require us to achieve these objectives at a level 50% greater than our own internal targets. With respect to MBO milestones, we generally expect that Mr. Isaacs will achieve his quarterly MBO milestones, although historically, this has not always been the case. The actual amount earned by Mr. Isaacs under our sales commission incentive plans for the year ended September 30, 2007 is shown in the column entitled “Non-Equity Incentive Plan Compensation” in our 2007 Summary Compensation Table appearing later in this prospectus. We expect that Mr. Isaacs will participate in our sales commission incentive plan for the calendar year ending December 31, 2008 on terms substantially similar to his participation in our sales commission incentive plan for the calendar year ended December 31, 2007.

Long-Term Equity Incentive Program.    We believe that long-term performance is achieved through an ownership culture that encourages such performance by our executive officers through the use of stock-based awards. Our equity benefit plans have been established to provide certain of our employees, including our executive officers, with incentives to help align those employees’ interests with the interests of our stockholders. Other than with respect to Messrs. Britt and Hershenson, our co-founders, our equity benefit plans have provided the principal method for our named executive officers to acquire equity or equity-linked interests in our company.

The size and terms of the initial option grant made to each executive officer upon joining our company are primarily based on competitive conditions applicable to the executive officer’s specific position. Most new hire option grants vest over a four year period with 25% vesting after the first 12 months of service and the remainder vesting ratably each month thereafter over the next three years. Annual option grants generally vest ratably each month over a four year period. All equity awards to our employees, including named executive officers, and to our directors in the year ended September 30, 2007 were granted at no less than the fair market value of our common stock as determined in good faith by our board of directors on the date of grant. In the absence of an active market for our common stock, our board of directors determined the fair market value of our common stock in good faith based in part on an analysis of factors including the price and other terms of our preferred stock sales in arms-length transactions; the introduction of new mobile data services; our entry into mobile operator and OEM agreements; our current and expected future operating and financial performance; the marketability of our equity securities; the market multiples of publicly-held technology companies with similar business models and similar financial results; comparable merger and acquisitions of technology companies with similar business models and similar financial results; and our likelihood of achieving a liquidation event. Commencing in September 2005, our board of directors also began considering in-depth contemporaneous valuations of our common stock presented to our board of directors by management in determining the fair market value of our common stock. We do not have any program, plan or obligation that requires us to grant equity compensation on specified dates and, because we have not been a public company, we have not made equity grants in connection with the release or withholding of material non-public information.

Prior to this offering, we have granted equity awards through our 2000 Stock Option/Stock Issuance Plan, or 2000 plan, which was adopted by our board of directors and stockholders to permit the grant of stock options, stock appreciation rights, restricted stock and other stock-based awards to our officers, directors, employees and consultants. In connection with this offering, our board of directors has adopted new equity benefit plans described under “—Employment Agreements and Arrangements —Employee Benefit Plans and Arrangements” below. The 2007 Equity Incentive Plan will replace our existing 2000 plan in connection with this offering and, as described below, will afford our compensation committee much greater flexibility in making a wide variety of equity awards. Participation in our 2007 Employee Stock Purchase Plan that we have adopted and will become effective in connection with this offering will also be available to all executive officers following this offering on the same basis as our other employees.

As stated above, our compensation committee retained Compensia to evaluate and recommend strategies for our employee stock option program in the years ended September 30, 2006 and September 30, 2007.

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Compensia’s reports found that our executive and key employee stock option ownership was generally within the 25^th and 50^th percentiles of the peer companies surveyed, ranking on average in the year ended September 30, 2007 at the 32^nd percentile of the peer companies surveyed and ranking on average in the year ended September 30, 2006 at the 35^th percentile of the peer companies surveyed. Peer company survey data was gathered by Compensia from the Dow Jones & Company CompensationPro database and the Advanced-HR, Inc. Option Impact database and targeted private, high-technology companies in the United States. For the 2007 report, Compensia sampled these databases for private companies in the high-technology industry with revenues of more than $20.0 million per year and considered late stage or having raised more than $100.0 million in private equity financing. For the 2006 report, Compensia sampled these databases for private companies in the high-technology industry with revenues of more than $20.0 million per year.

In June 2006 and June 2007, our compensation committee recommended, and our board of directors approved, company-wide stock option “refresh” programs. All of our named executive officers were granted stock options in the “refresh” programs in the amounts indicated in the table set forth below. For each of these June 2006 and June 2007 stock option grants and consistent with the equity strategy outlined in Compensia’s reports, the compensation committee recommended targeting executive officer stock option ownership at the 50^th percentile of the peer group data provided by Compensia. The 50^th percentile was selected to offer competitive long term compensation to retain employees with key skills while recognizing that targeting a higher percentile was not feasible given the limits of our existing available stock option pool. On average, the executive’s stock option ownership was within 5.3% of the target percentile following the 2006 grants and within 7.8% of the target percentile following the 2007 grants. In addition, in recommending the size of the stock option grants for our named executive officers, the compensation committee emphasized compensation parity among our executive team and considered the retention value of unvested stock and stock options held by our executive officers. As with salary, our compensation committee believes that Mr. Nothhaft should be compensated at a higher level than the rest of the executive team given his status as our most senior officer and the critical role he plays in helping to achieve our strategic business objectives and therefore the size of Mr. Nothhaft’s grants are larger than the rest of the executive group.

Name	Number of Shares Subject to 2006 Stock Options	Number of Shares Subject to 2007 Stock Options
Henry R. Nothhaft	1,570,000	1,150,000
Nancy J. Hilker(1)	388,000	400,000
Joe F. Britt, Jr.	389,000	400,000
Mark W. Fisher	389,000	400,000
Matt Hershenson	389,000	400,000
James L. Isaacs	389,000	400,000

(1) Ms. Hilker’s June 2006 stock option grant covered 1,000 less shares than the rest of the named executive officer group (other than Mr. Nothhaft) as a result of her willingness to accept a lesser number of shares in order to accommodate an even distribution of shares covered by stock options granted to executive officers given the limitation established by our compensation committee on the available number of shares for grant to executive officers under our company-wide stock option “refresh” program in June 2006.

Severance and Change in Control Benefits.

Our named executive officers are entitled to certain severance and/or change in control benefits, the terms of which are described below under “—Employment Agreements and Arrangements—Executive Employment and Severance Agreements.” We believe that these severance and change in control benefits are an essential element of our executive compensation package and assist us in recruiting and retaining talented individuals. The severance and change in control benefits do not influence and are not influenced by other elements of compensation as these benefits serve different objectives than the other elements. We provide change in control vesting acceleration benefits because we believe, in the event of a potential change in control, the benefits

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promote the ability of our named executive officers to act in the best interests of our stockholders even though they could be terminated as a result of the change in control. Change in control vesting acceleration benefits are structured on a “double-trigger” basis, meaning that the executive officer must experience a constructive termination or a termination without cause in connection with the change in control in order for the change in control benefits to become due, which is directly tied to our goal of eliminating, or at least reducing, the reluctance of our named executive officers to diligently consider and pursue potential change in control transactions notwithstanding the risk to their own job positions. Our compensation committee also believes that the cash severance benefits that we agreed to provide to Messrs. Nothhaft, Britt and Hershenson are reasonable and appropriate. In the case of Messrs. Britt and Hershenson, our board of directors believed that providing them with severance benefits was an essential retention element to their compensation packages given our closing of a preferred stock financing in June 2001 with new investors that indicated a desire to conduct a search for a new Chief Executive Officer. As discussed below, we agreed to provide Mr. Nothhaft with cash severance benefits in connection with the negotiation of the employment agreement we entered into with Mr. Nothhaft in June 2007.

As illustrated below under “—Potential Payments Upon Termination or Change in Control,” Mr. Nothhaft is entitled to a higher level of severance and change in control benefits. While Mr. Nothhaft was provided with certain severance and change in control benefits when he joined us as Chairman and Chief Executive Officer in 2002, the benefits described below are based on the terms of the employment agreement that we entered into with Mr. Nothhaft in June 2007. The employment agreement we entered into with Mr. Nothhaft in June 2007 was entered into in large part to provide Mr. Nothhaft with these severance and change in control benefits. The chairman of our compensation committee represented us in our negotiations with Mr. Nothhaft concerning his new employment agreement, and was advised by our general counsel with the assistance of our outside legal counsel. In addition, we also retained Compensia to provide an analysis and recommendations regarding current market terms and best practices for severance and change in control benefits for chief executive officers of newly-public companies and technology companies of our size. Commensurate with our goal of providing Mr. Nothhaft with a highly competitive compensation package given the critical role he plays in our ability to achieve our strategic business objectives, our compensation committee believed that providing Mr. Nothhaft with these severance and change in control benefits was reasonable and appropriate. With respect to the base salary component of Mr. Nothhaft’s compensation package, his base salary was determined in accordance with the procedures outlined above under “—Elements of Compensation—Base Salary” and was memorialized in his employment agreement. Likewise, the recommended stock option grant reflected in Mr. Nothhaft’s employment agreement was determined as part of our June 2007 company-wide stock option “refresh” program discussed above under “—Elements of Compensation—Long-Term Equity Incentive Program” that was undertaken contemporaneously with the negotiation of his new agreement.

Restricted Stock Grants or Awards.    Our board of directors did not authorize the grant of restricted stock or restricted stock awards to any of our executive officers in the year ended September 30, 2007. However, our compensation committee, in its discretion, may in the future elect to make such grants to our executive officers if it deems it advisable.

Benefits.    We also provide the following benefits to our named executive officers, generally on the same basis provided to all of our employees. We believe these benefits are consistent with companies with which we compete for employees:

• paid time off, at the following rates:

• 15 days per year for employees with less than two years of service;

• 18 days per year for employees with more than two years but less than four years of service; and

• 20 days per year for employees with more than four years of service;

• ten paid holidays per year;

• health, dental and vision insurance;

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• life insurance, short-term and long-term disability, accidental death and dismemberment;

• flexible spending accounts for health and dependent care; and

• 401(k) plan participation.

We believe that these benefits are consistent with companies with which we compete for employees.

Perquisites.    For the year ended September 30, 2007, none of our executive officers received any perquisites, other than Mr. Nothhaft. Mr. Nothhaft’s perquisites are set forth in his employment agreement that we negotiated with Mr. Nothhaft in June 2007. These perquisites include reimbursement for personal life insurance coverage, reimbursement for internet connectivity costs related to the maintenance of Mr. Nothhaft’s home office, and reimbursement for tax consulting services. The compensation committee believes that the level of perquisites provided for under Mr. Nothhaft’s employment agreement are reasonable and consistent with the compensation committee’s philosophy of incentivizing and retaining exceptional executives to help us achieve our strategic business objectives.

Executive Employment and Severance Agreements.    Our executive officers who were parties to at-will employment agreements prior to this offering will continue, following this offering, to be parties to such employment agreements in their current form until such time as our compensation committee determines, in its discretion, that revisions to such employment agreements are advisable. In addition, consistent with our compensation philosophy, we intend to continue to maintain the current compensation and benefits for our executive officers; however, our compensation committee, in its discretion, may in the future revise, amend or add to the compensation and benefits of any executive officer if it deems it advisable. The material terms of our employment agreements and severance agreements with our named executive officers are described below under “—Employment Agreements and Arrangements—Executive Employment and Severance Agreements.”

Accounting and Tax Considerations

Section 162(m) of the Internal Revenue Code of 1986 limits our deduction for federal income tax purposes to not more than $1 million of compensation paid to certain executive officers in a calendar year. Compensation above $1 million may be deducted if it is “performance-based compensation.” Our compensation committee has not yet established a policy for determining which forms of incentive compensation awarded to our executive officers should be designated to qualify as “performance-based compensation.” To maintain flexibility in compensating our executive officers in a manner designed to promote our objectives, the compensation committee has not adopted a policy that requires all compensation to be deductible. However, the compensation committee intends to evaluate the effects of the compensation limits of Section 162(m) on any compensation it proposes to grant, and the compensation committee intends to provide future compensation in a manner consistent with our best interests and those of our stockholders.

Effective October 1, 2006, we began accounting for share-based awards under the provisions of Statement of Financial Accounting Standards No. 123(R), Share-Based Payment, or SFAS 123(R). SFAS 123(R) establishes accounting for stock-based awards exchanged for employee services. Accordingly, stock-based compensation cost is measured at grant date, based on the fair value of the awards, and is recognized as an expense ratably over the requisite employee service period. The compensation committee has determined to retain for the foreseeable future our stock option program as the sole component of its long-term compensation program, and, therefore, to record this expense on an ongoing basis according to SFAS 123(R). Accounting rules also require us to record cash compensation as an expense at the time the obligation is incurred.

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Summary Compensation Table

The following table sets forth all of the compensation awarded to, earned by, or paid to our principal executive officer, principal financial officer and our four other highest paid executive officers for the fiscal year ended September 30, 2007. The officers listed in the table below are referred to in this prospectus as the “named executive officers.”

2007 Summary Compensation Table

Name and Principal Position	Year	Salary ($)	Option Awards ($)(1)	Non-Equity Incentive Plan Compensation ($)		All Other Compensation ($)		Total ($)
Henry R. Nothhaft     Chief Executive Officer and     Chairman of the Board of     Directors	2007	433,888	86,580	—		24,419	(2)	544,887
Nancy J. Hilker.     Senior Vice President and     Chief Financial Officer	2007	241,377	19,671	—		—		261,048
Joe F. Britt, Jr.     Senior Vice President and     Chief Technology Officer	2007	241,377	24,104	—		—		265,482
Mark W. Fisher     Senior Vice President of     Marketing and Business     Development	2007	241,377	24,278	—		—		265,655
Matt Hershenson     Senior Vice President of     Advanced Products	2007	241,377	24,104	—		—		265,482
James L. Isaacs     Senior Vice President of     Worldwide Sales and     Alliances	2007	201,502	22,006	87,437	(3)	—		310,945

(1) The dollar amounts in this column represent the compensation expense recognized for the year ended September 30, 2007 for stock option awards granted in the year ended September 30, 2007 and in prior fiscal years. These amounts have been calculated in accordance with SFAS 123(R) for options granted the year ended September 30, 2007 and FASB Statement No. 123, Accounting for Share-Based Compensation, or SFAS 123, using the Black-Scholes-Merton, or Black-Scholes, option-pricing model. Pursuant to Securities and Exchange Commission rules, the amounts shown exclude the impact of estimated forfeiture related to service-based vesting conditions. For a discussion of valuation assumptions, see Note 6 to our consolidated financial statements included elsewhere in this prospectus.

(2) Consists of the following payments: (a) $1,200 for reimbursement of airline club memberships, (b) $2,062 for reimbursement of tax consulting services, (c) $9,541 in reimbursement for costs related to maintenance of Mr. Nothhaft’s home office, (d) $7,606 in group term life insurance premiums and (e) $4,010 in other perquisites.

(3) Represents compensation earned under our sales commission incentive plans for the year ended September 30, 2007. For a description of the terms of our sales commission incentive plans, please see “—Compensation Discussion and Analysis—Elements of Compensation—Sales Commission Incentive Plans.”

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Grants of Plan-Based Awards in Fiscal 2007

The following table sets forth certain information regarding grants of plan-based awards to the named executive officers during the year ended September 30, 2007.

2007 Grants of Plan-Based Awards Table

Name		Estimated Possible Payouts Under Non-Equity Incentive Plan Awards				All Other Option Awards: Number of Securities Underlying Options (#)(1)	Exercise or Base Price of Option Awards ($)(2)	Grant Date Fair Value of Option Awards ($)(3)
	Grant Date	Target     ($)		Maximum     ($)
Henry R. Nothhaft	6/13/07	—		—		1,150,000	0.55	309,619
Nancy J. Hilker	6/13/07	—		—		400,000	0.55	107,693
Joe F. Britt, Jr.	6/13/07	—		—		400,000	0.55	107,693
Mark W. Fisher	6/13/07	—		—		400,000	0.55	107,693
Matt Hershenson	6/13/07	—		—		400,000	0.55	107,693
James L. Isaacs	—	110,000	(4)	165,000	(4)	—	—	—
	6/13/07	—		—		400,000	0.55	107,693

(1) The stock options reflected in this column were granted under our 2000 plan. The shares subject to each stock option vest over a four year period, with 1/48^th of the shares subject to the option vesting on a monthly basis. Vesting is contingent upon continued service and the stock option may be exercised prior to vesting, subject to our right to repurchase unvested shares in the event the named executive officer’s employment terminates. For a description of the terms of stock options granted under our 2000 plan, please see “—Employment Agreements and Arrangements—Employee Benefit Plans and Arrangements—2000 Stock Option/Stock Issuance Plan.”

(2) Represents the per share fair market value of our common stock, as determined by our board of directors in good faith on the grant date. For a discussion of the factors considered by our board of directors in determining the per share fair market value of our common stock on the grant date, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Significant Estimates—Stock-Based Compensation—Valuation of Common Stock.”

(3) Represents the grant date fair value of such stock option as determined in accordance with SFAS 123(R).

(4) The amounts set forth in these columns represent Mr. Isaacs’ target and maximum commissions under our sales commission incentive plans, which plans are established on a calendar year basis. Accordingly, a portion of the amounts set forth in these columns were established under our sales commission incentive plan for the year ended December 31, 2006 and a portion of the amounts set forth in these columns were established under our sales commission incentive plan for the year ended December 31, 2007. For more information on our sales commission incentive plans, please see “—Compensation Discussion and Analysis —Elements of Compensation —Sales Commission Incentive Plans.” The actual amount earned by Mr. Isaacs under our sales commission incentive plans for the year ended September 30, 2007 is shown in the column entitled “Non-Equity Incentive Plan Compensation” in our 2007 Summary Compensation Table. As such, the amounts set forth in this column do not represent additional compensation earned by Mr. Isaacs for the year ended September 30, 2007.

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Employment Agreements and Arrangements

Executive Employment and Severance Agreements

Henry R. Nothhaft. In June 2007, we entered into an employment agreement with Mr. Nothhaft, our Chief Executive Officer and Chairman of the Board of Directors. The agreement sets forth an initial base salary of $433,888 for Mr. Nothhaft, subject to annual review. Mr. Nothhaft is also eligible to earn an annual bonus determined by the board of directors contingent upon meeting planned operating objectives determined by the board of directors, payable in any combination of cash, stock or options to acquire shares of our common stock. However, as described under “—Compensation Discussion and Analysis—Elements of Compensation—Other Cash Incentive or Bonus Programs,” we do not maintain a cash incentive or other bonus program for our executive officers (other than our sales commission incentive plans), so we have not paid Mr. Nothhaft any bonuses under his agreement. The agreement also provides for the issuance of a stock option to purchase 1,150,000 shares of common stock under the 2000 plan. The shares subject to such stock option vest over a four year period, with 1/48^th of the shares subject to the stock option vesting monthly, and is exercisable for six months following the date of Mr. Nothhaft’s termination. The agreement also provides for standard employee benefits as well as the reimbursement of up to $8,000 per year for personal life insurance coverage, the reimbursement of up to $350 per month for broadband access at up to two residences, up to an $800 per month health insurance supplement for out-of-pocket costs for health coverage for Mr. Nothhaft or any persons covered by his sponsored health insurance policy, reimbursement of up to $5,000 per year for tax consulting services, the reimbursement or payments by us for business class airline travel on all domestic and international flights when upgrades through other means are unavailable, and reimbursement for direct and reasonable out-of-pockets expenses incurred in connection with the performance of his duties upon presentation of proper receipts and vouchers.

In the event that Mr. Nothhaft is terminated without cause or Mr. Nothhaft terminates his own employment for good reason other than in connection with a change in control, as these terms are defined in the agreement, Mr. Nothhaft will, subject to certain conditions (including our receipt of an effective waiver and general release executed by Mr. Nothhaft), be entitled to receive certain severance benefits, including the following:

• an amount equal to his base salary in effect as of the date of his termination date for a period of 18 months, payable in semi-monthly installments over an 18-month period in accordance with our standard payroll procedures;

• if Mr. Nothhaft is eligible for and timely elects continuation of his health insurance pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, or COBRA, we will reimburse Mr. Nothhaft for the cost of his COBRA premiums for a period of 12 months, provided, however, that our obligation to pay Mr. Nothhaft’s COBRA premiums will cease immediately in the event Mr. Nothhaft becomes eligible to be covered by his employer’s group health insurance; and

• 50% of the unvested portion of Mr. Nothhaft’s options to purchase our common stock will be vested upon the termination date.

In the event that Mr. Nothhaft is terminated without good cause or resigns with good reason either within the two months immediately preceding or in the 12 months immediately following a change in control, as these terms are defined in the agreement, Mr. Nothhaft will, subject to certain conditions (including our receipt of an effective waiver and general release executed by Mr. Nothhaft), be entitled to receive certain severance benefits, including the following :

• a single lump-sum payment equal to 24 months of his base salary in effect as of the date of his termination;

• if Mr. Nothhaft is eligible for and timely elects continuation of his health insurance pursuant to COBRA, we will reimburse Mr. Nothhaft for the cost of his COBRA premiums for a period of 12 months, provided, however, that our obligation to pay Mr. Nothhaft’s COBRA premiums will cease immediately in the event Mr. Nothhaft becomes eligible to be covered by group health insurance; and

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• 50% of the unvested portion of Mr. Nothhaft’s options to purchase our common stock will be vested upon the earlier of the change in control or the termination date.

If the total amount of payments and benefits to be provided to Mr. Nothhaft under the agreement would cause Mr. Nothhaft to incur “golden parachute” excise tax liability, then the payment will be reduced to the extent necessary to leave him in a better after-tax position than if no such reduction had occurred. The agreement does not provide for any tax “gross-up” payments to Mr. Nothhaft. If we determine that any severance payment would be subject to Section 409A(a)(1) of the Internal Revenue Code, payment of such benefits will be accelerated or delayed to the minimum extent necessary so that such benefits are not subject to the provisions of Section 409A(a)(1) of the Internal Revenue Code.

During the one year period following the termination of Mr. Nothhaft’s employment relationship with us, Mr. Nothhaft agreed that he will not interfere with our business by soliciting our employees and customers, and that he will cooperate with us in responding to the reasonable requests of our board of directors and our general counsel.

Nancy J. Hilker. In June 2002, we entered into an employment agreement with Ms. Hilker, our Senior Vice President and Chief Financial Officer. The agreement sets forth an initial base salary of $215,000 for Ms. Hilker, subject to annual review. Ms. Hilker will be eligible to receive incentive bonuses for her contribution to the achievement of significant milestones, and to participate in any future executive bonus program that we may adopt. However, we do not currently maintain a cash incentive or other bonus program for our executive officers (other than our sales commission incentive plans), so we have not paid Ms. Hilker any bonuses under her agreement. The agreement also provides for the issuance of a stock option to purchase 600,189 shares of common stock under the 2000 plan. The shares subject to such stock option vest over a four year period, with 1/4^th of the shares subject to the stock option vesting on the first anniversary of Ms. Hilker’s start date, and 1/48^th  of the shares subject to the stock option vesting monthly thereafter. Ms. Hilker is also eligible to participate in our general employee benefit plans in accordance with the terms and conditions of such plans.

In the event that Ms. Hilker is terminated without cause or becomes subject to involuntary termination within 12 months of a change in control, as these terms are defined in her employment agreement, the unvested portion of all of Ms. Hilker’s options to purchase shares of our common stock will be subject to accelerated vesting such that the number of shares that would have vested had Ms. Hilker’s employment continued for 12 months following the termination date will vest as of the termination date.

Joe F. Britt, Jr. In September 2000, we entered into a restricted stock agreement that was amended in March 2003 with Mr. Britt, our Senior Vice President and Chief Technology Officer, pursuant to which Mr. Britt purchased 4,000,000 shares of common stock at a price of $0.0075 per share. Of these shares, 3,000,000 shares were initially subject to vesting and a right of repurchase in favor of us. This right of repurchase lapsed in 36 equal and continuous monthly installments each month thereafter until our right of repurchase lapsed in full in September 2003. In July 2001, we entered into a severance agreement with Mr. Britt. The severance agreement provides that if Mr. Britt is terminated without cause, as defined in the restricted stock agreement, he will continue to receive his base salary then in effect for six months following the date of termination, subject to certain conditions (including Mr. Britt remaining on the job until the effective date of termination scheduled by us, satisfactory performance through the termination date, and the signing of a general release of all claims against us). Pursuant to stock option agreements subsequently entered into with Mr. Britt, in the event that Mr. Britt is terminated without cause within 12 months of a change in control, as these terms are defined in his stock option agreements, 1/4^th of the options to purchase shares of our common stock held by Mr. Britt will vest upon his termination date.

Mark W. Fisher. In August 2003, we entered into an employment agreement with Mr. Fisher, our Senior Vice President of Marketing and Business Development. The agreement sets forth an initial base salary of $215,000 for Mr. Fisher, subject to annual review. The agreement also provides for the issuance of a stock option

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to purchase 350,000 shares of common stock under our 2000 plan. The shares subject to such stock option vest over a four year period, with 1/4^th of the shares subject to the stock option vesting on the first anniversary of Mr. Fisher’s start date, and 1/48^th of the shares subject to the stock option vesting monthly thereafter. Mr. Fisher is also eligible to participate in our general employee benefit plans in accordance with the terms and conditions of such plans.

In the event that Mr. Fisher is terminated without cause or becomes subject to involuntary termination within 12 months of a change in control, as these terms are defined in his employment agreement, the unvested portion of all of Mr. Fisher’s options to purchase shares of our common stock will be subject to accelerated vesting such that the number of shares that would have vested had Mr. Fisher’s employment continued for 12 months following the termination date will vest as of the termination date.

Matt Hershenson. In September 2000, we entered into a restricted stock agreement that was amended in March 2003 with Mr. Hershenson, our Senior Vice President of Advanced Products, pursuant to which Mr. Hershenson purchased 4,000,000 shares of common stock at a price of $0.0075 per share. Of these shares, 3,000,000 shares were initially subject to vesting and a right of repurchase in favor of us. This right of repurchase lapsed in 36 equal and continuous monthly installments each month thereafter until our right of repurchase lapsed in full in September 2003. In July 2001, we entered into a severance agreement with Mr. Hershenson. The severance agreement provides that if Mr. Hershenson is terminated without cause, as defined in his restricted stock agreement, he will continue to receive his base salary for six months following the date of termination, subject to certain conditions (including Mr. Hershenson remaining on the job until the effective date of termination scheduled by us, satisfactory performance through the termination date, and the signing of a general release of all claims against us). Pursuant to stock option agreements subsequently entered into with Mr. Hershenson, in the event that Mr. Hershenson is terminated without cause within 12 months of a change in control, as these terms are defined in his stock option agreements, 1/4^th of the options to purchase shares of our common stock held by Mr. Hershenson will vest upon his termination date.

James L. Isaacs. In October 2002, we entered into an employment agreement with Mr. Isaacs, our Senior Vice President of Worldwide Sales and Alliances. The agreement sets forth an initial base salary of $180,000 for Mr. Isaacs, subject to annual review. The agreement also provides that Mr. Isaacs will be eligible to earn an incentive bonus of up to $110,000 for his contribution to the achievement of significant milestones. Bonuses payable to Mr. Isaacs, which are in the form of target commissions, are determined in accordance with our sales commission incentive plans as described in more detail under “—Compensation Discussion and Analysis—Elements of Compensation—Sales Commission Incentive Plans.” Under our sales commission incentive plans for each of the years ended December 31, 2006 and 2007, Mr. Isaacs’ target commission was set at approximately $27,500 per quarter, or $110,000 annually, with no minimum commission and the maximum commission set at $165,000, or 150% of the target commission. Mr. Isaacs’ employment agreement also provides for the issuance of a stock option to purchase 400,000 shares of common stock under our 2000 plan. The shares subject to such stock option vest over a four year period, with 1/4^th of the shares subject to the stock option vesting on the first anniversary of Mr. Isaacs’s start date, and 1/48^th of the shares subject to the stock option vesting monthly thereafter. Mr. Isaacs is also eligible to participate in our general employee benefit plans in accordance with the terms and conditions of such plans.

In the event that Mr. Isaacs is terminated without cause or becomes subject to involuntary termination within 12 months of a change in control, as these terms are defined in his employment agreement, the unvested portion of all of Mr. Isaacs’s options to purchase shares of our common stock will be subject to accelerated vesting such that the number of shares that would have vested had Mr. Isaacs’s employment continued for 12 months following the termination date will vest as of the termination date.

Each of our named executive officers are employed “at-will,” and each named executive officer’s employment may be terminated at any time by us or the named executive officer.

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Employee Benefit Plans and Arrangements

2000 Stock Option/Stock Issuance Plan

Our board of directors adopted, and our stockholders approved, the 2000 Stock Option/Stock Issuance Plan, or 2000 plan, in March 2000. The 2000 plan provides for the grant of incentive stock options, nonstatutory stock options and restricted stock purchase awards (which we also refer to as stock issuance awards).

An aggregate of 51,207,696 shares of common stock are reserved for issuance under the 2000 plan. As of September 30, 2007, options to purchase 42,861,396 shares of common stock at a weighted average exercise price per share of approximately $0.35 remained outstanding and 191,000 shares of common stock had been issued pursuant to restricted stock purchase awards. As of September 30, 2007, 2,056,194 shares of common stock remained available to be made subject to new awards under the 2000 plan. However, upon the signing of the underwriting agreement for this offering, no further awards will be granted under the 2000 plan. All outstanding awards will continue to be governed by their existing terms.

Our board of directors, or a duly authorized committee of the board, has the authority to construe and interpret the terms of the 2000 plan and the awards granted under it. Our board has delegated administration of the 2000 plan to our compensation committee.

Stock Options.    The 2000 plan provides for the grant of incentive stock options and nonstatutory stock options. Under federal tax laws, only employees may receive incentive stock options. Nonstatutory stock options may be granted to employees, non-employee directors and consultants. The exercise price of incentive stock options may not be less than 100% of the fair market value of our common stock on the date of grant. The exercise price of nonstatutory stock options may not be less than 85% of the fair market value of our common stock on the date of grant. However, the exercise price of an option will not be less than 110% of the fair market value in the case of options granted to any person who, at the time of the grant, owns or is deemed to own stock possessing more than 10% of our total combined voting power or that of any of our affiliates. Shares subject to options under the 2000 plan generally vest in a series of installments over an optionee’s period of service, with a minimum vesting rate as to non-executive employees of at least 20% per year over five years from the date of grant.

In general, the maximum term of options granted under the 2000 plan is ten years. Unless the terms of an optionee’s stock option agreement provide otherwise, if an optionee’s service relationship with us, or any of our affiliates, ceases for any reason other than disability, death or misconduct, the optionee may exercise the vested portion of any options for three months after the date of such termination. If an optionee’s service relationship with us, or any of our affiliates, ceases due to disability or death (or an optionee dies within a certain period following cessation of service), the optionee or a beneficiary may exercise any vested options for a period of 12 months. If the optionee’s service terminates due to misconduct, the options will terminate immediately. The period in which the option term may be exercised following a termination of service may be extended in the discretion of the plan administrator. In no event, however, may an option be exercised beyond the expiration of its original term.

Restricted Stock Purchase Awards.    Restricted stock purchase awards may be granted in consideration for cash, check or past or future services actually rendered to us or our affiliates. Shares of common stock acquired under such awards may, but need not, be subject to forfeiture in accordance with a vesting schedule, with a minimum vesting rate as to non-executive employees of at least 20% per year over five years from the date of grant. The purchase price for restricted stock purchase awards may not be less than 85% of the fair market value of our common stock on the date of grant (or 110% of the fair market value in the case of awards granted to any person who, at the time of the grant, owns or is deemed to own stock possessing more than 10% of our total combined voting power or that of any of our affiliates).

Asset Sale or Merger.    In the event of the sale of substantially all our assets or our merger or consolidation, the surviving or acquiring corporation may assume outstanding stock awards, or may substitute substantially equivalent cash awards that preserve the spread existing at the time of the transaction for outstanding stock

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options. If the surviving or acquiring corporation elects not to assume or substitute for outstanding stock awards, then the stock awards will be accelerated in full unless otherwise provided in the applicable stock award agreement. The plan administrator may provide for additional vesting of outstanding awards, either at the time of grant or at any time while the award remains outstanding. Awards that are not assumed will terminate immediately following the transaction.

Other Provisions.    If there is a transaction or event which changes our stock that does not involve our receipt of consideration, such as a merger, consolidation, reorganization, stock dividend or stock split, our board of directors will appropriately and proportionately adjust the class and the maximum number of shares subject to the 2000 plan and to outstanding awards to prevent the dilution or enlargement of benefits thereunder.

2008 Equity Incentive Plan

Our board of directors adopted the                      2008 Equity Incentive Plan, or                      2008 plan, in                      2008 and our stockholders approved the 2008 plan in 2008. The 2008 plan will become effective immediately upon the signing of the underwriting agreement for this offering. The 2008 plan will terminate on , 2018, unless sooner terminated by our board of directors.

Stock Awards.    The 2008 plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, performance stock awards, and other forms of equity compensation (collectively, “stock awards”), as well as performance cash awards, which may be granted to employees, including officers, non-employee directors, and consultants.

Share Reserve.    Following this offering, the aggregate number of shares of common stock that may be issued initially pursuant to stock awards under the 2008 plan is              shares. Such share reserve consists of: (a) up to shares remaining available for future issuance under the 2000 plan plus (b) an additional                  shares newly reserved for issuance under the 2008 plan. The number of shares of common stock reserved for issuance will automatically increase on January 1, from January 1, 2009 through January 1, 2018, by the lesser of (a)     % of the total number of shares of common stock outstanding on December 31 of the preceding calendar year, (b) shares, or (c) such lesser number of shares of common stock determined by our board of directors prior to the start of a year for which an increase applies. As of the date hereof, no shares of common stock have been issued under the 2008 plan.

If a stock award granted under the 2008 plan expires or otherwise terminates without being exercised in full, the shares of common stock not acquired pursuant to the stock award again become available for subsequent issuance under the 2008 plan. In addition, the following types of shares under the 2008 plan will become available for the grant of new stock awards under the 2008 plan: (a) shares that are forfeited or repurchased by us prior to becoming fully vested; (b) shares subject to stock awards that are settled in cash; (c) shares withheld to satisfy income and employment withholding taxes; (d) shares used to pay the exercise price of an option in a net exercise arrangement; (e) shares tendered to us to pay the exercise price of an option; and (f) shares that are cancelled pursuant to an exchange or repricing program. Shares issued under the 2008 plan may be previously unissued shares or reacquired shares, including shares bought on the open market.

Administration.    Our board of directors has the authority to make awards under the 2008 plan and to construe, interpret, amend, and terminate the 2008 plan. Our board of directors has delegated concurrent authority to administer the 2008 plan to our compensation committee. Subject to the terms of the 2008 plan, our board of directors or an authorized committee, referred to as the plan administrator, determines recipients, dates of grant, the numbers and types of stock awards to be granted, and the terms and conditions of the stock awards, including the period of their exercisability and vesting. Subject to the limitations set forth below, the plan administrator will also determine the exercise price of options granted, the consideration to be paid for restricted stock awards, and the strike price of stock appreciation rights. The plan administrator also has the authority to reprice any outstanding stock award under the 2008 plan, cancel any outstanding stock award and in exchange re-grant a new stock award, or engage in any other action that is treated as a repricing under generally accepted accounting principles.

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Stock Options.    Incentive and nonstatutory stock options are granted pursuant to incentive and nonstatutory stock option agreements adopted by the plan administrator. The plan administrator determines the exercise price for a stock option provided that the exercise price of an incentive stock option and nonstatutory stock option generally cannot be less than 100% of the fair market value of our common stock on the date of grant. Options granted under the 2008 plan vest at the rate specified by the plan administrator.

Generally, the plan administrator determines the term of stock options granted under the 2008 plan, up to a maximum of ten years (except in the case of certain incentive stock options, as described below). Unless the terms of an optionee’s stock option agreement provide otherwise, if an optionee’s relationship with us, or any of our affiliates, ceases for any reason other than disability or death, the optionee may exercise any vested options for a period of three months following the cessation of service. If an optionee’s service relationship with us, or any of our affiliates, ceases due to disability or death (or an optionee dies within a certain period following cessation of service), the optionee or a beneficiary may exercise any vested options for a period of 12 months in the event of disability, and 18 months in the event of death. The option term may be extended in the event that exercise of the option following termination of service is prohibited by applicable securities laws. In no event, however, may an option be exercised beyond the expiration of its original term.

Acceptable consideration for the purchase of common stock issued upon the exercise of a stock option will be determined by the plan administrator and may include (a) cash or check, (b) a broker-assisted cashless exercise, (c) the tender of common stock previously owned by the optionee, (d) a net exercise of the option, and (e) other legal consideration approved by the plan administrator.

Unless the plan administrator provides otherwise, options generally are not transferable except by will, the laws of descent and distribution, or pursuant to a domestic relations order. An optionee may designate a beneficiary, however, who may exercise the option following the optionee’s death.

Section 162(m) Limitations.    No person may be granted stock options or stock appreciation rights covering more than              shares of common stock under the 2008 plan during any calendar year. In addition, no person may be granted during any calendar year performance-based stock awards covering more than shares of common stock or performance-based cash awards with a potential value in excess of $             during any calendar year. Such limitations are designed to help assure that any deductions to which we would otherwise be entitled in connection with these awards will not be subject to the $1 million limitation on the income tax deductibility of compensation paid to certain executive officers imposed by Section 162(m) of the Internal Revenue Code.

Tax Limitations on Incentive Stock Options.    The maximum number of shares that may be issued pursuant to the exercise of incentive stock options over the term of the 2008 plan is              shares. Incentive stock options may be granted only to our employees. The aggregate fair market value, determined at the time of grant, of shares of our common stock with respect to incentive stock options that are exercisable for the first time by an optionee during any calendar year under all of our stock plans may not exceed $100,000. No incentive stock option may be granted to any person who, at the time of the grant, owns or is deemed to own stock possessing more than 10% of our total combined voting power or that of any of our affiliates unless (a) the option exercise price is at least 110% of the fair market value of the stock subject to the option on the date of grant, and (b) the term of the incentive stock option does not exceed five years from the date of grant.

Restricted Stock Awards.    Restricted stock awards are granted pursuant to restricted stock award agreements adopted by the plan administrator. Restricted stock awards may be granted in consideration for: (a) cash or check, (b) past or future services rendered to us or our affiliates, or (c) any other form of legal consideration. Shares of common stock acquired under a restricted stock award may, but need not, be subject to forfeiture to us in accordance with a vesting schedule to be determined by the plan administrator. Rights to acquire shares under a restricted stock award may be transferred only upon such terms and conditions as set by the plan administrator.

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Restricted Stock Unit Awards.    Restricted stock unit awards are granted pursuant to restricted stock unit award agreements adopted by the plan administrator. Restricted stock unit awards may be granted in consideration for any form of legal consideration. A restricted stock unit award may be settled by cash, delivery of stock, a combination of cash and stock as deemed appropriate by the plan administrator, or in any other form of consideration set forth in the restricted stock unit award agreement. Additionally, dividend equivalents may be credited in respect of shares covered by a restricted stock unit award. Except as otherwise provided in the applicable award agreement, restricted stock units that have not vested will be forfeited upon the participant’s cessation of continuous service for any reason.

Stock Appreciation Rights.    Stock appreciation rights are granted pursuant to stock appreciation rights agreements adopted by the plan administrator. The plan administrator determines the strike price for a stock appreciation right, which generally cannot be less than 100% of the fair market value of the common stock on the date of grant. Upon the exercise of a stock appreciation right, we will pay the participant an amount equal to the product of (a) the excess of the per share fair market value of our common stock on the date of exercise over the strike price, multiplied by (b) the number of shares of common stock with respect to which the stock appreciation right is exercised. A stock appreciation right granted under the 2008 plan vests at the rate specified in the stock appreciation rights agreement.

The plan administrator determines the term of stock appreciation rights granted under the 2008 plan up to a maximum of ten years. If a participant’s service relationship with us, or any of our affiliates, ceases, then the participant, or the participant’s beneficiary, may exercise any vested stock appreciation right for three months (or such longer or shorter period specified in the stock appreciation right agreement) after the date such service relationship ends. In no event, however, may a stock appreciation right be exercised beyond the expiration of its term.

Performance Stock Awards.    The 2008 plan permits the grant of performance stock awards that may qualify as performance-based compensation that is not subject to the $1,000,000 limitation on the income tax deductibility of compensation paid to certain executive officers imposed by Section 162(m) of the Internal Revenue Code. To help assure that the compensation attributable to one or more performance stock awards will so qualify, our compensation committee can structure one or more such awards so that stock will be issued or paid pursuant to such award only upon the achievement of certain pre-established performance goals during a designated performance period. The maximum benefit to be received by a participant in any calendar year attributable to stock awards may not exceed              shares of our common stock.

Other Stock Awards.    The plan administrator may grant other awards based in whole or in part by reference to our common stock. The plan administrator will set the number of shares under the award and all other terms and conditions of such awards.

Changes to Capital Structure.    In the event that there is a specified type of change in our capital structure, such as a stock split, appropriate and proportionate adjustments will be made to (a) the class and number of shares reserved under the 2008 plan (including the minimum number of shares added to the share reserve on each January 1), (b) the class and maximum number of shares that may be issued pursuant to the exercise of incentive stock options, (c) the class and maximum number of stock options, stock appreciation rights, and performance stock awards for which any one person may be granted per calendar year, and (d) the class and number of shares and exercise price or strike price, if applicable, of all outstanding stock awards.

Corporate Transactions.    In the event of certain significant corporate transactions, our board of directors has the discretion to:

• arrange for the assumption, continuation, or substitution of an outstanding stock award by a surviving or acquiring entity or parent company;

• accelerate the vesting of an outstanding stock award

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• provide for the termination of an outstanding stock award prior to the effective time of the corporate transaction; or

• provide for the surrender of an outstanding stock award in exchange for a payment equal to the excess of (a) the value of the property that the optionee would have received upon exercise of the stock award over (b) the exercise price otherwise payable in connection with the stock award.

The board of directors is not be obligated to treat all stock awards, even those that are of the same type, in the same manner.

Changes in Control.    Our board of directors has the discretion to provide that a stock award under the 2008 plan will immediately vest as to all or any portion of the shares subject to the stock award (a) immediately upon the occurrence of certain specified change in control transactions, whether or not such stock award is assumed, continued, or substituted by a surviving or acquiring entity in the transaction, or (b) in the event a participant’s service with us or a successor entity is terminated actually or constructively within a designated period following the occurrence of certain specified change in control transactions. Stock awards held by participants under the 2008 plan will not vest on such an accelerated basis unless specifically provided by the participant’s applicable award agreement.

2008 Employee Stock Purchase Plan

Our board of directors adopted our 2008 Employee Stock Purchase Plan, or 2008 purchase plan, in                     2008 and our stockholders approved the 2008 purchase plan in                      2008. The 2008 purchase plan will become effective immediately upon the signing of the underwriting agreement for this offering.

Share Reserve.    Following this offering, the 2008 purchase plan authorizes the issuance of              shares of common stock pursuant to purchase rights granted to our employees or to employees of any of our designated affiliates. The number of shares of common stock reserved for issuance will automatically increase on January 1, from January 1, 2009 through January 1, 2018, by the lesser of (a)     % of the total number of shares of common stock outstanding on December 31 of the preceding calendar year, (b)              shares, or (c) such lesser number of shares of common stock determined by our board of directors prior to the start of a year for which an increase applies. The maximum number of shares that may be issued pursuant to the exercise of purchase rights over the term of the 2008 purchase plan is              shares. The 2008 purchase plan is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Internal Revenue Code. As of the date hereof, no shares of common stock have been purchased under the 2008 purchase plan.

Administration.    Our board of directors has delegated its authority to administer the 2008 purchase plan to our compensation committee. The 2008 purchase plan is implemented through a series of offerings of purchase rights to eligible employees. Under the 2008 purchase plan, we may specify offerings with a duration of not more than 27 months, and may specify shorter purchase periods within each offering. Each offering will have one or more purchase dates on which shares of common stock will be purchased for employees participating in the offering. We anticipate commencing offerings under the 2008 purchase plan at some time after the completion of this offering.

Payroll Deductions.    Generally, all regular employees, including executive officers, employed by us or by any of our affiliates may participate in the 2008 purchase plan and may contribute, normally through payroll deductions, a percentage of their earnings for the purchase of common stock under the 2008 purchase plan. Unless otherwise determined by our board of directors, common stock will be purchased for accounts of employees participating in the 2008 purchase plan at a price per share equal to the lower of (a) 85% of the fair market value of a share of our common stock on the first date of an offering, or (b) 85% of the fair market value of a share of our common stock on the date of purchase.

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Reset Feature.    Our board of directors may specify that if the fair market value of a share of our common stock on any purchase date within a particular offering period is less than the fair market value on the start date of that offering period, then the employees in that offering period will automatically be transferred and enrolled in a new offering period which will begin on the next day following such a purchase date.

Limitations.    Employees may have to satisfy one or more of the following service requirements before participating in the 2008 purchase plan, as determined by our board of directors: (a) customarily employed for more than 20 hours per week, (b) customarily employed for more than five months per calendar year, or (c) continuous employment with us or one of our affiliates for a period of time not to exceed two years. No employee may purchase shares under the 2008 purchase plan at a rate in excess of $25,000 worth of our common stock valued based on the fair market value per share of our common stock at the beginning of an offering for each year such a purchase right is outstanding. Finally, no employee will be eligible for the grant of any purchase rights under the 2008 purchase plan if immediately after such rights are granted, such employee has voting power over 5% or more of our outstanding capital stock measured by vote or value.

Changes to Capital Structure.    In the event that there is a specified type of change in our capital structure, such as a stock split, appropriate and proportionate adjustments will be made to (a) the class and number of shares reserved under the 2008 purchase plan (including the minimum number of shares added to the share reserve on each January 1), (b) the class and maximum number of shares that may be issued pursuant to the exercise of purchase rights over the term of the 2008 purchase plan, (c) the class and maximum number of shares that may be issued to a participant in a given offering or purchase period (if such limit is applicable), and (d) the class and number of shares and purchase price of all outstanding purchase rights.

Corporate Transactions.    In the event of certain significant corporate transactions, any then-outstanding rights to purchase our stock under the 2008 purchase plan will be assumed, continued or substituted for by any surviving or acquiring entity (or its parent company). If the surviving or acquiring entity (or its parent company) elects not to assume, continue or substitute for such purchase rights, then the participants’ accumulated contributions will be used to purchase shares of our common stock within ten business days prior to such corporate transaction, and such purchase rights will terminate immediately thereafter.

Sales Commission Incentive Plans

At the beginning of each calendar year, our compensation committee approves a U.S. sales commission incentive plan to encourage and reward members of our sales team, including Mr. Isaacs, for their efforts in securing and expanding revenue-generating relationships for us during the calendar year. For more information on our sales commission incentive plans, please see “—Compensation Discussion and Analysis—Elements of Compensation—Sales Commission Incentive Plans.”

401(k) Plan

Our employees, including our named executive officers, are eligible to participate in our 401(k) plan. Our 401(k) plan is intended to qualify as a tax qualified plan under Section 401 of the Internal Revenue Code. Our 401(k) plan provides that each participant may contribute a portion of his or her pretax compensation, up to a statutory limit, which for most employees is $15,500 in the year ending September 30, 2008 (with a larger “catch up” limit for older employees). Employee contributions are held and invested by the plan’s trustee. Our 401(k) plan also permits us to make discretionary contributions and matching contributions, subject to established limits and a vesting schedule. To date, we have not made any contributions to the plan on behalf of participating employees.

Pension Benefits

Our named executive officers did not participate in, or otherwise receive any benefits under, any pension or retirement plan sponsored by us during the year ended September 30, 2007.

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Nonqualified Deferred Compensation

During the year ended September 30, 2007, our named executive officers did not contribute to, or earn any amounts with respect to, any defined contribution or other plan sponsored by us that provides for the deferral of compensation on a basis that is not tax-qualified.

Outstanding Equity Awards at Fiscal Year-End

The following table shows for the fiscal year ended September 30, 2007, certain information regarding outstanding equity awards at fiscal year end for our named executive officers.

2007 Outstanding Equity Awards at Fiscal Year-End Table

	Option Awards
Name	Number of Securities Underlying Unexercised Options (#) Exercisable(1)		Number of Securities Underlying Unexercised Options (#) Unexercisable	Option Exercise Price ($)	Option Expiration Date
Henry R. Nothhaft	4,043,778	(2)	—	0.25	10/27/12
	380,000	(2)	—	0.25	03/10/13
	190,000	(2)	—	0.25	07/23/13
	190,000	(2)	—	0.25	06/08/14
	2,800,000	(2)	—	0.25	10/12/14
	1,570,000	(2)	—	0.25	06/28/16
	1,150,000	(2)	—	0.55	06/12/17
Nancy J. Hilker	600,189	(3)	—	0.25	08/21/12
	100,000	(3)	—	0.25	02/01/14
	320,000	(2)	—	0.25	11/29/14
	388,000	(2)	—	0.25	06/28/16
	400,000	(2)	—	0.55	06/12/17
Joe F. Britt, Jr.	30,000	(2)	—	0.25	11/11/12
	400,000	(2)	—	0.25	03/10/13
	200,000	(2)	—	0.25	07/23/13
	200,000	(2)	—	0.25	06/08/14
	320,000	(2)	—	0.25	11/29/14
	389,000	(2)	—	0.25	06/28/16
	400,000	(2)	—	0.55	06/12/17
Mark W. Fisher	25,000	(4)	—	0.25	06/03/13
	350,000	(3)	—	0.25	09/03/13
	325,000	(3)	—	0.25	02/01/14
	320,000	(2)	—	0.25	11/29/14
	389,000	(2)	—	0.25	06/28/16
	400,000	(2)	—	0.55	06/12/17
Matt Hershenson	30,000	(2)	—	0.25	11/11/12
	400,000	(2)	—	0.25	03/10/13
	200,000	(2)	—	0.25	07/23/13
	200,000	(2)	—	0.25	06/08/14
	320,000	(2)	—	0.25	11/29/14
	389,000	(2)	—	0.25	06/28/16
	400,000	(2)	—	0.55	06/12/17
James L. Isaacs	400,000	(3)	—	0.25	01/13/13
	300,000	(3)	—	0.25	02/01/14
	320,000	(2)	—	0.25	11/29/14
	389,000	(2)	—	0.25	06/28/16
	400,000	(2)	—	0.55	06/12/17

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(1) Stock options may be exercised prior to vesting, or early exercised, subject to our repurchase rights that expire over the vesting periods indicated in the footnotes below. Accordingly, all stock options granted to the named executive officers that were outstanding as of September 30, 2007 were exercisable in full.

(2) The shares subject to this stock option vest monthly in equal installments over a four year period. Vesting is contingent upon continued service and the stock option may be early exercised, subject to our right to repurchase unvested shares in the event the named executive officer’s employment terminates.

(3) The shares subject to this stock option vest as to 25% of the shares subject to the option after one year, with the remaining shares subject to the stock option vesting on an equal monthly basis over the following 36 months. Vesting is contingent upon continued service and the stock option may be early exercised, subject to our right to repurchase unvested shares in the event the named executive officer’s employment terminates.

(4) 100% of the shares subject to this stock option vested six months following the grant date.

Option Exercises and Stock Vested

Our named executive officers did not exercise any stock options during the fiscal year ended September 30, 2007, nor did any restricted stock awards we granted to any of our named executive officers vest during such period.

Potential Payments Upon Termination or Change in Control

See “—Employment Agreements and Arrangements—Executive Employment and Severance Agreements” above for a description of the compensation and benefits payable to each of our named executive officers in certain termination situations. The amount of compensation and benefits payable to each named executive officer in various termination situations has been estimated in the tables below. The actual amount of compensation and benefits payable in any termination event can only be determined at the time of the termination of the named executive officer’s employment with us.

Henry R. Nothhaft

The following table estimates the potential payments and benefits upon employment termination for Mr. Nothhaft as if his employment had been terminated as of September 28, 2007, the last business day of our prior fiscal year.

Compensation and Benefits	No Change in Control		Change in Control
	Termination without Cause or for Good Reason ($)		Termination without Cause or for Good Reason ($)
Base Salary	650,832	(1)	867,776	(2)
COBRA Premiums(3)	10,006		10,006
Vesting Acceleration(4)

(1) Represents 18 months of continuing salary payments.

(2) Represents a single lump sum payment equal to 24 months of base salary.

(3) Represents payment of 12 months of continued COBRA premiums for medical, dental and vision coverage calculated at $869 per month for the three month period ended December 31, 2007 and at $800 per month for the nine month period ending September 31, 2008. The calculation also includes a two percent fee on such premiums payable to an outsourced COBRA administration company which would ordinarily be paid by Mr. Nothhaft.

(4) The value of vesting acceleration is calculated assuming a price per share of $            , which is the mid-point of the range reflected on the cover page of this prospectus, with respect to unvested option shares subject to acceleration minus the exercise price of these unvested option shares.

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Other Named Executive Officers

The following table estimates the potential payments and benefits upon employment termination for each of the named executive officers, other than Mr. Nothhaft, as if such named executive officer’s employment had been terminated as of September 28, 2007, the last business day of our fiscal year ended September 30, 2007.

	Termination without Cause or for Good Reason without Change in Control		Change in Control and Termination without Cause or for Good Reason
Name	Base Salary     ($)(1)	Vesting Acceleration     ($)	Base Salary     ($)(1)	Vesting Acceleration     ($)(2)
Nancy J. Hilker	—	—	—
Joe F. Britt, Jr.	120,689	—	120,689
Mark W. Fisher	—	—	—
Matt Hershenson	120,689	—	120,689
James L. Isaacs	—	—	—

(1) Represents six months of continuing salary payments.

(2) The value of vesting acceleration is calculated assuming a price per share of $            , which is the mid-point of the range reflected on the cover page of this prospectus, with respect to unvested option shares subject to acceleration minus the exercise price of these unvested option shares.

Non-Employee Director Compensation

Cash Compensation Arrangements

Our directors do not currently receive any cash compensation for their services as members of our board of directors or any committee of our board of directors. Our non-employee directors are reimbursed for reasonable travel, lodging and other expenses incurred in connection with their attendance at board of directors or committee meetings.

After this offering, we will continue to reimburse our non-employee directors for expenses incurred in attending our board or committee meetings. In addition, each non-employee director will receive a quarterly retainer of $              for service as a board member and between $              and $              for service as a member of each committee of the board. Each non-employee member of our board of directors will also receive $                          for each board meeting or committee meeting, if not on the same day, that the director attends in person and $              for each board meeting that he attends by telephone. In addition, the lead independent director will be entitled to receive a supplemental annual retainer of $            , the chair of the audit committee will be entitled to receive a supplemental annual retainer of $            , the chair of the compensation committee will be entitled to receive a supplemental annual retainer of $ and the chair of the nominating and corporate governance committee will be entitled to receive a supplemental annual retainer of $            . This cash compensation will be paid annually. Payments will be pro rated for any partial year of service.

Equity Compensation Arrangements

Our non-employee directors are eligible to receive stock option awards under our 2000 plan. Each of our non-employee directors received options to purchase shares of our common stock under our 2000 plan. In September 2007, we granted options to purchase 250,000 shares of common stock at an exercise price of $0.65 per share to each of our non-employee directors. Each of these options has a four-year monthly vesting schedule, with 25% of the shares vesting on the one-year anniversary of the grant and the remaining 75% of the shares vesting in equal monthly installments over the remaining 36 months. In the event of certain change in control transactions, including our merger with or into another corporation or the sale of substantially all of our assets, the vesting of all shares subject to each option granted to the non-employee directors will accelerate in full

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and be fully exercisable. Upon the signing of the underwriting agreement for this offering, the 2000 plan will terminate so that no further awards may be granted under the 2000 plan. For a description of the terms of the 2000 plan, see “—Employment Agreements and Arrangements—Employee Benefit Plans and Arrangements—2000 Stock Option/Stock Issuance Plan.”

Our board of directors has also adopted a non-employee director equity compensation program that provides for automatic grants of stock options to our non-employee directors under the 2008 plan following this offering. Each individual who is elected or appointed as a non-employee director of the board of directors after this offering will automatically be granted an option to purchase              shares of our common stock. Twenty-five percent of the shares subject to each such option vest one year after the grant date, and the remaining shares shall vest in equal monthly installments over the remaining 36 months. The vesting commencement date of these options will occur when the director first takes office. At the time of each of our annual stockholders’ meetings, beginning in 2009, each non-employee director who has served for at least the preceding              months and who will continue to be a director after that meeting will automatically be granted a nonstatutory option on such date to purchase              shares of our common stock that will vest in equal monthly installments over 12 months. All these options will be granted with an exercise price equal to the fair market value of our common stock on the date of the grant. For a description of the terms of the 2008 plan, see the section entitled “—Employment Agreements and Arrangements—Employee Benefit Plans and Arrangements—2008 Equity Incentive Plan.”

Director Compensation Table

The following table shows for the fiscal year ended September 30, 2007 certain information with respect to the compensation of all of our non-employee directors. Neither Mr. Nothhaft nor Mr. Britt, each of whom are executive officers, receives additional compensation for serving on our board of directors or its committees.

2007 Director Compensation Table

Name	Fees Earned or Paid in Cash ($)	Option Awards ($)(1)(2)(3)	Total ($)
Jeffrey D. Brody	—	382	382
Gregory P. Galanos	—	382	382
Richard S. Gilbert	—	3,302	3,302
Eric Hippeau	—	382	382
Albert A. “Rocky” Pimentel	—	3,302	3,302

(1) The dollar amounts in this column represent the compensation expense recognized for the year ended September 30, 2007 for stock option awards granted in the year ended September 30, 2007. No stock option awards were granted to our directors in prior fiscal years. These amounts have been calculated in accordance with SFAS 123(R) using the Black-Scholes option-pricing model. Pursuant to SEC rules, the amounts shown exclude the impact of estimated forfeiture related to service-based vesting conditions. For a discussion of valuation assumptions, see Note 6 to our consolidated financial statements included elsewhere in this prospectus.

(2) As of September 30, 2007, each of the directors listed in the table above held stock options exercisable for 250,000 shares of our common stock at an exercise price of $0.65 per share. The shares subject to these stock options vest as to 25% of the shares subject to the option after one year, with the remaining shares subject to the stock option vesting on an equal monthly basis over the following 36 months. Vesting is contingent upon continued service and the stock option may be early exercised, subject to our right to repurchase unvested shares in the event the director’s service with us terminates.

(3) The grant date fair value, as determined in accordance with SFAS 123(R), of the stock option awards granted to the directors listed in the table above during the year ended September 30, 2007 was as follows: $81,155 for Mr. Brody, $81,155 for Mr. Galanos, $81,567 for Mr. Gilbert, $81,155 for Mr. Hippeau and $81,567 for Mr. Pimentel.

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Limitation of Liability and Indemnification

Our amended and restated certificate of incorporation and amended and restated bylaws to be in effect upon the closing of this offering limit the liability of our directors, officers, employees and other agents to the fullest extent permitted by Delaware law; provided, however, that we indemnify any such person in connection with a proceeding initiated by such person only if such indemnification is expressly required by law, the proceeding was authorized by our board of directors, the indemnification is provided by us, in our sole discretion, pursuant to the Delaware General Corporation Law or other applicable law or is otherwise expressly required by our amended and restated bylaws. Section 145 of the Delaware General Corporation Law permits indemnification of officers, directors and other agents under certain circumstances and subject to certain limitations. Delaware law also permits a corporation to not hold its directors personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability for:

• breach of their duty of loyalty to us or our stockholders;

• acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;

• unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; and

• any transaction from which the director derived an improper personal benefit.

These limitations of liability do not apply to liabilities arising under the federal or state securities laws and do not affect the availability of equitable remedies such as injunctive relief or rescission.

Our amended and restated bylaws also permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in this capacity. We have obtained directors’ and officers’ liability insurance to cover certain liabilities described above.

We have entered, and intend to continue to enter, into separate indemnity agreements with each of our directors and executive officers, that require us to indemnify such persons against any and all expenses (including attorneys’ fees), witness fees, judgments, fines, settlements and other amounts incurred (including expenses of a derivative action) in connection with any action, suit or proceeding or alternative dispute resolution mechanism, inquiry hearing or investigation, whether threatened, pending or completed, to which any such person may be made a party by reason of the fact that such person is or was a director, an officer or an employee of us or any of our affiliated enterprises, provided that such person’s conduct did not constitute a breach of his or her duty of loyalty to us or our stockholders, and was not an act or omission not in good faith or which involved intentional misconduct or a knowing violation of laws. The indemnity agreements also set forth certain procedures that will apply in the event of a claim for indemnification thereunder. We believe that these provisions and agreements are necessary to attract and retain qualified persons as officers and directors of our company.

At present, there is no pending litigation or proceeding involving any of our directors or executive officers as to which indemnification is required or permitted, and we are not aware of any threatened litigation or proceeding that may result in a claim for indemnification.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted by directors, executive officers or persons controlling us, we have been informed that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

The following is a summary of transactions since October 1, 2004 (except as indicated below under “—Sales of Securities”) to which we have been a party in which the amount involved exceeded $120,000 and in which any of our executive officers, directors or beneficial holders of more than 5% of our capital stock had or will have a direct or indirect material interest, other than compensation arrangements which are described under the section of this prospectus entitled “Executive and Director Compensation—Executive Compensation.”

Related Party Transaction Policy

In October 2007, we adopted a Related Party Transaction Policy that sets forth our procedures for the identification, review, consideration and approval or ratification of “related-person transactions.” The policy will become effective immediately upon the signing of the underwriting agreement for this offering. For purposes of our policy only, a “related-person transaction” is a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we and any “related person” are, were or will be participants in which the amount involves exceeds $120,000. Transactions involving compensation for services provided to us as an employee or director are not covered by this policy. A “related person” is any executive officer, director or beneficial owner of more than 5% of any class of our voting securities, including any of their immediate family members and any entity owned or controlled by such persons.

Under the policy, if a transaction has been identified as a related-person transaction (including any transaction that was not a related-person transaction when originally consummated or any transaction that was not initially identified as a related-person transaction prior to consummation), our management must present information regarding the related-person transaction to our audit committee (or, if audit committee approval would be inappropriate, to another independent body of our board of directors) for review, consideration and approval or ratification. The presentation must include a description of, among other things, the material facts, the interests, direct and indirect, of the related persons, the benefits to us of the transaction and whether the transaction is on terms that are comparable to the terms available to or from, as the case may be, an unrelated third party or to or from employees generally. Under the policy, we will, on an annual basis, collect information that our general counsel deems reasonably necessary from each director, executive officer and (to the extent feasible) significant stockholder to enable us to identify any existing or potential related-person transactions and to effectuate the terms of the policy. In addition, under our Code of Business Conduct and Ethics, our employees and directors have an affirmative responsibility to disclose any transaction or relationship that reasonably could be expected to give rise to a conflict of interest to our general counsel, or, if the employee is an executive officer, to our board of directors. In considering related-person transactions, our audit committee (or other independent body of our board of directors) will take into account the relevant available facts and circumstances including, but not limited to:

• the risks, costs and benefits to us;

• the impact on a director’s independence in the event that the related person is a director, immediate family member of a director or an entity with which a director is affiliated;

• the terms of the transaction;

• the availability of other sources for comparable services or products; and

• the terms available to or from, as the case may be, unrelated third parties or to or from employees generally.

The policy requires that, in determining whether to approve, ratify or reject a related-person transaction, our audit committee (or other independent body of our board of directors) must consider, in light of known circumstances, whether the transaction is in, or is not inconsistent with, our best interests and those of our stockholders, as our audit committee (or other independent body of our board of directors) determines in the good faith exercise of its discretion. All of the transactions described below were entered into prior to the adoption of the policy and were approved by our board of directors or our audit committee.

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Sales of Securities

The shares of common stock set forth in the table below were purchased by certain of our executive officers and directors in March 2000 at a per share price of $0.0075, for aggregate consideration of $60,000.

During the period from September 2000 through December 2000, we issued and sold an aggregate of 9,907,407 shares of our Series A preferred stock at a per share price of $1.08 for aggregate consideration of approximately $10.7 million. During the period from July 2001 through September 2001, we issued and sold an aggregate of 12,249,932 shares of our Series B-1 preferred stock at a per share price of $1.4596 for aggregate consideration of approximately $17.9 million. During the period from May 2002 through November 2002, we issued and sold an aggregate of 15,726,655 shares of our Series C preferred stock at per share prices of $1.2371 and $0.01 for aggregate consideration of approximately $13.0 million, including issuances upon the exercise of warrants to purchase an aggregate of 5,228,943 shares of Series C preferred stock. During the period from January 2003 through February 2003, we issued and sold an aggregate of 39,136,220 shares of our Series D preferred stock at a per share price of $0.9007 for aggregate consideration of approximately $35.3 million. During the period from February 2004 through November 2005, we issued and sold an aggregate of 63,044,509 shares of our Series D' preferred stock at a per share price of $0.9007 for aggregate consideration of approximately $56.8 million.

During the period from January 2003 through February 2003, we issued warrants to purchase an aggregate of 5,870,424 shares of our Series D preferred stock in connection with our Series D preferred stock financing. The warrants have an exercise price of $0.9007 per share. These warrants will terminate upon the closing of this offering unless exercised earlier. During the period from February 2004 through September 2006, we issued warrants to purchase an aggregate of 14,846,368 shares of our Series D' preferred stock in connection with our Series D' preferred stock financing and certain strategic partnerships. These warrants have an exercise price of $0.9007 per share. The warrants to purchase shares of our Series D' preferred stock have a net exercise provision under which the holder may, in lieu of payment of the exercise price in cash, surrender the warrant and receive a net amount of shares based on the fair market value of our common stock at the time of exercise of the warrant after deduction of the aggregate exercise price. Unless exercised earlier, immediately prior to the closing of this offering, these warrants will be automatically net exercised for an aggregate of              shares of common stock, assuming a fair market value equal to the assumed initial public offering price of $             per share.

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We believe that the terms obtained or consideration that we paid or received, as applicable, in connection with the transactions described above were comparable to terms available or the amounts that would be paid or received, as applicable, in arm’s-length transactions. The following table summarizes since our inception purchases of our common stock and preferred stock by our directors, executive officers and holders of more than 5% of our capital stock and their affiliated entities.

Purchaser	Common Stock		Series A Preferred Stock	Series B-1 Preferred Stock	Series C Preferred Stock	Series D Preferred Stock	Series D Preferred Stock Warrants	Series D1 Preferred Stock	Series D1 Preferred Stock Warrants
Executive Officers and Directors:
Henry R. Nothhaft	—		—	—	—	—	—	—	—
Jeffrey D. Brody(1)	—		—	6,104,412	5,152,558	6,847,385	1,027,107	5,724,520	858,677
Gregory P. Galanos(2)	—		8,229,330	1,027,679	4,419,330	8,104,806	1,215,718	6,823,289	1,023,492
Richard S. Gilbert	—		—	—	—	—	—	—	—
Eric Hippeau(3)	—		—	—	—	12,767,846	1,915,175	6,214,140	932,119
Albert A. “Rocky” Pimentel	—		—	—	—	—	—	—	—
Nancy J. Hilker	—		—	—	—	—	—	—	—
Joe F. Britt, Jr.	4,000,000	(4)	95,539	—	—	—	—	—	—
Donn Dobkin	—		—	—	—	—	—	—	—
Mark W. Fisher	—		—	—	—	—	—	—	—
Les Hamilton	—		—	—	—	—	—	—	—
Matt Hershenson	4,000,000		—	—	—	—	—	—	—
James L. Isaacs	—		—	—	—	—	—	—	—
Sandra J. Taylor	—		—	—	—	—	—	—	—
Principal Stockholders:
Entities affiliated with Mobius Technology Ventures(2)	—		8,229,330	1,027,679	4,419,330	8,104,806	1,215,718	6,823,289	1,023,492
Entities affiliated with Redpoint Ventures(1)	—		—	6,104,412	5,152,558	6,847,385	1,027,107	5,724,520	858,677
T-Mobile Venture Fund GmbH & Co. KG	—		—	1,959,441	1,422,075	277,562	41,634	12,266,791	3,379,932
Entities affiliated with SOFTBANK Capital(3)	—		—	—	—	12,767,846	1,915,175	6,214,140	932,119
Motorola, Inc.	—		—	—	—	—	—	11,102,475	5,515,154
Entities affiliated with Meritech Capital Partners(5)	—		—	—	—	7,029,260	1,054,388	4,419,173	662,876
Entities affiliated with Venture Strategy Partners(6)	—		—	—	3,701,734	2,494,874	374,230	3,330,743	499,611

(1) Consists of shares held by Redpoint Ventures II, L.P., Redpoint Associates II, LLC, Redpoint Technology Partners Q-1, L.P. and Redpoint Technology Partners A-1, L.P. Mr. Brody, one of our directors, is a managing director of Redpoint Ventures and has shared voting and investment power over these shares; however, he disclaims beneficial ownership of these shares, except to the extent of his proportionate partnership interest therein.

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(2) Consists of shares held by Mobius Technology Ventures VI, L.P., SOFTBANK U.S. Ventures Fund VI L.P., Mobius Technology Ventures Advisors Fund VI, L.P. and Mobius Technology Ventures Side Fund VI, L.P. Mr. Galanos, one of our directors, is a managing director of Mobius Technology Ventures and has shared voting and investment power over these shares; however, he disclaims beneficial ownership of these shares, except to the extent of his proportionate partnership interest therein.

(3) Consists of shares held by SOFTBANK Capital Partners LP, SOFTBANK Capital Advisors Fund LP and SOFTBANK Capital LP. Mr. Hippeau, one of our directors, is a managing partner of SOFTBANK Capital and has shared voting and investment power over these shares; however, he disclaims beneficial ownership of these shares, except to the extent of his proportionate partnership interest therein.

(4) Consists of (i) 3,850,000 shares held by Joe F. Britt, Jr., or his successor, as Trustee of The Joe Freeman Britt, Jr. Revocable Living Trust UTA dated May 30, 2003, and (ii) 150,000 shares held by Yumie Sonoda Britt, or her successor, as Trustee of The Britt Irrevocable Children’s Trust UTA dated July 14, 2006.

(5) Consists of shares held by Meritech Capital Partners II, L.P., Meritech Capital Affiliates II, L.P. and MCP Entrepreneur Partners II, L.P.

(6) Consists of shares held by Venture Strategy Partners II, LP and Venture Strategy Affiliates II, LP.

Amended and Restated Investors’ Rights Agreement

We entered into an investors’ rights agreement with certain purchasers of our common stock, preferred stock and warrants to purchase our preferred stock, including our principal stockholders with which certain of our directors are affiliated. As of September 30, 2007, the holders of 178,033,791 shares of our common stock, including the shares of common stock issuable upon the conversion of our preferred stock and exercise of certain outstanding warrants, are entitled to rights with respect to the registration of their shares under the Securities Act. For a description of these registration rights, see the section entitled “Description of Capital Stock—Registration Rights.”

Amended and Restated Voting Agreement

We have entered into a voting agreement with the purchasers of our outstanding preferred stock, including entities with which certain of our directors are affiliated, and certain other stockholders, obligating each party to vote or consent at each stockholder meeting or with respect to each written stockholder consent to elect the nominees of certain parties to the board of directors. The parties to the voting agreement have agreed, subject to certain conditions, to vote their shares so as to elect as directors the nominees designated by certain of our investors, including Mobius Technology Advisors and its affiliated funds, which has designated Mr. Galanos for election to our board of directors; Redpoint Ventures II, L.P. and its affiliated funds, which has designated Mr. Brody for election to our board of directors; and SOFTBANK Capital and its affiliated funds, which has designated Mr. Hippeau for election to our board of directors. In addition, the parties to the voting agreement have agreed to vote their shares so as to elect our then current Chief Executive Officer to our board of directors and so as to elect two persons designated by the holders of a majority of the outstanding shares of common stock held by certain majority common stockholders including Messrs. Britt, Nothhaft and Hershenson. Upon the closing of this offering, the voting agreement will terminate in its entirety and none of our stockholders will have any special rights regarding the election or designation of members of our board of directors.

Material Agreements with Principal Stockholders

Motorola, Inc.

In September 2006, we entered into a master software license, product development and distribution agreement with Motorola, one of our beneficial holders of more than 5% of our common stock as set forth above. Under this agreement, we grant Motorola a royalty-free license to distribute our client software and provide Motorola with reference designs to use as the basis for developing Danger-enabled mobile devices. Motorola’s first Danger-enabled mobile device launched in November 2007 with T-Mobile USA in the United States. Under our agreement with Motorola, Motorola is responsible for the sales of mobile devices, including providing

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marketing support to mobile operators and handling warranty returns and repairs. Motorola also agrees to pay certain per unit royalties that are due to third parties for the commercial distribution of software that we incorporate into our client software. We agree to indemnify Motorola for intellectual property claims related to our client software or our SDE. In addition, we agree to pay Motorola per unit warranty payments in the event certain client software defects thresholds are reached, as well as to take corrective action to cure the defects. We have made no payments to date, and cannot accurately estimate the amount of payments we may have to make in the future under this agreement. The payments, if any, will depend on the nature of and rate of defect claims in each quarter.

In addition, in connection with the master software license, product development and distribution agreement with Motorola, we issued Motorola a warrant to purchase 3,849,783 shares of Series D' preferred stock at $0.9007 per share in September 2006. The warrant is exercisable immediately and will expire in September 2009, unless exercised earlier. Motorola is entitled to exercise the unvested portion of the warrant to purchase unvested common shares under the warrant; however, we have a right to repurchase the unvested common shares at the original exercise price. Upon the signing of the agreement with Motorola, 50% of the common shares subject to the warrant vested and the remaining common shares subject to the warrant will vest if Motorola meets certain performance requirements by December 31, 2007. As of September 30, 2007, the warrant has not been exercised. The warrant has a net exercise provision under which the holder may, in lieu of payment of the exercise price in cash, surrender the warrant and receive a net amount of shares based on the fair market value of our common stock at the time of exercise of the warrant after deduction of the aggregate exercise price. Unless exercised earlier, immediately prior to the closing of this offering, this warrant will be automatically net exercised for an aggregate of              shares of common stock, assuming a fair market value equal to the assumed initial public offering price of $             per share.

We believe that the agreement with Motorola was in our best interests and on terms no less favorable to us than could be obtained from other third parties. See “Business—OEM Partner Relationships—Motorola, Inc.” above for further description of the material terms of the agreement.

T-Mobile Venture Fund GmbH & Co. KG

We have entered into service agreements with several affiliates of T-Mobile Venture Fund GmbH & Co. KG, one of our beneficial holders of more than 5% of our common stock as set forth above, including T-Mobile USA, Inc., T-Mobile (UK) Limited, T-Mobile Austria GmbH and T-Mobile Deutschland GmbH. Pursuant to these agreements, the T-Mobile affiliates pay us recurring monthly service fees for each subscriber that is able to access our SDE. Our T-Mobile customers also pay us for premium applications, content or services that we offer to their subscribers. We record and report on the number of active subscribers and the volume of premium applications, content and services transactions, and electronically deliver these records to our operator customers to enable them to bill their subscribers appropriately. Our T-Mobile customers are responsible for billing and collection from subscribers. Our T-Mobile customer service level agreements set forth the performance standards for our services and give these affiliates of T-Mobile rights to receive credits towards our monthly service fees if the availability of our SDE degrades or our SDE experiences outages that, when measured on a monthly basis, exceed minimum performance thresholds. In addition, our agreements with our T-Mobile customers provide that we indemnify the T-Mobile customers for intellectual property claims related to our client software and SDE. See “Business—Customers” above for further description of the material terms of these agreements.

T-Mobile USA, Inc.    In March 2006, we entered into a master services agreement with T-Mobile USA, which was effective as of June 1, 2005. This agreement, as amended, expires on December 31, 2008. During the years ended September 30, 2006 and September 30, 2007, we invoiced T-Mobile USA, net of credits, an aggregate of $31.9 million and $52.3 million, respectively, under this agreement. In addition, for one premium application that we offer to help hearing-impaired subscribers, we collect fees from the application providers and pay T-Mobile USA a share of revenue for each premium application download by its subscribers. Such fees reduce the invoiced amounts associated with premium applications, content and services in the current period

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that are deferred and amortized to revenues in accordance with our revenue recognition policy. During the years ended September 30, 2006 and September 30, 2007, we paid T-Mobile USA an aggregate of $100,000 and $157,000, respectively, related to this premium application.

T-Mobile (UK) Limited.    In October 2005, we entered into a services agreement with T-Mobile (UK) Limited, which agreement has an initial term of three years and will continue in force thereafter unless either we or T-Mobile (UK) notifies the other earlier of its intent to terminate pursuant to the terms of the agreement. During the years ended September 30, 2006 and September 30, 2007, we invoiced T-Mobile (UK) an aggregate of $423,000 and $314,000, respectively, under this agreement. The amount invoiced to T-Mobile (UK) during the year ended September 30, 2006 included a cost reimbursement of $116,000 in relation to a non-recurring engineering project.

T-Mobile Austria GmbH.    In September 2005, we entered into a services agreement with T-Mobile Austria GmbH. This agreement has an initial term of three years and will be automatically renewed for successive one year periods unless either we or T-Mobile Austria notifies the other earlier of its intent not to renew pursuant to the terms of the agreement. During the years ended September 30, 2006 and September 30, 2007, we invoiced T-Mobile Austria an aggregate of $120,000 and $60,000, respectively, under this agreement.

T-Mobile Deutschland GmbH.    In March 2005, we entered into a master services agreement with T-Mobile Deutschland GmbH. This agreement has an initial term of three years and will be automatically renewed for successive one year periods unless either we or T-Mobile Deutschland notifies the other earlier of its intent not to renew pursuant to the terms of the agreement. During the years ended September 30, 2006 and September 30, 2007, we invoiced T-Mobile Deutschland an aggregate of $913,000 and $945,000, respectively, under this agreement.

We have entered into separate contractual agreements with T-Mobile USA under which it provides us with mobile phone services for our employees. Pursuant to this agreement, T-Mobile USA provides us with certain discounted rates for use of its cellular service. During the years ended September 30, 2006 and September 30, 2007, we paid an aggregate of $142,000 and $212,000, respectively, to T-Mobile USA for services under these agreements.

In addition, in November 2005, we entered into a warrant issuance agreement and issued a warrant to T-Mobile Venture Fund GmbH & Co. KG to purchase 1,539,914 shares of Series D' preferred stock at an exercise price of $0.9007 per share in consideration for the launch of our mobile data services in Germany with T-Mobile. The warrant is exercisable immediately and expires three years from the issuance date. As of September 30, 2007, the warrant has not been exercised. The warrant has a net exercise provision under which the holder may, in lieu of payment of the exercise price in cash, surrender the warrant and receive a net amount of shares based on the fair market value of our common stock at the time of exercise of the warrant after deduction of the aggregate exercise price. Unless exercised earlier, immediately prior to the closing of this offering, this warrant will be automatically net exercised for an aggregate of              shares of common stock, assuming a fair market value equal to the assumed initial public offering price of $             per share.

We believe that each of the agreements entered into with entities affiliated with T-Mobile Venture Fund GmbH & Co. KG were in our best interests and on terms no less favorable to us than could be obtained from other third parties.

Transactions with Entities Affiliated with Directors

We are currently negotiating and plan to enter into a software license agreement with Kineto Wireless, Inc., or Kineto, a wireless technology company. Richard S. Gilbert, a member of our board of directors, is the President and Chief Executive Officer of Kineto. The proposed agreement calls for $270,000 in payments by us for a license and engineering support from Kineto to develop a prototype Danger-enabled mobile device that

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interoperates with Kineto’s unlicensed mobile access, or UMA, technology. We anticipate that the agreement will have a three year term and that each party may terminate the agreement prior to the end of the term only for an uncured material breach by the other party.

We are currently negotiating and plan to enter into a content license and distribution agreement with Glu Mobile, Inc., or Glu, a provider of mobile games. Albert A. “Rocky” Pimentel, a member of our board of directors and the chair of our audit committee, is the Executive Vice President and Chief Financial Officer of Glu. Under the proposed agreement, we would license mobile games from Glu and sell those games to subscribers of our mobile operator customers as part of our premium applications, content and services offering. In exchange, we would pay Glu a percentage share of the retail price charged for its games. Our payments to Glu under the agreement will depend on the number of games offered, the retail price that our mobile operators set for the games, and the number of purchases of Glu’s games by subscribers. We anticipate that the agreement will have a one year term, that each party may terminate the agreement prior to the end of the initial term only for an uncured material breach by the other party, and that following the initial term, the agreement will remain in effect until terminated on 30 days notice by either party.

Other Transactions

We have entered into employment agreements with our executive officers that, among other things, provide for certain severance and change of control benefits. For a description of these agreements, see the section entitled “Executive and Director Compensation—Executive Compensation—Employment Agreements and Arrangements—Executive Employment and Severance Agreements.”

We have granted stock options to our executive officers and to members of our board of directors. For a description of these options, see the section entitled “Executive and Director Compensation—Non-Employee Director Compensation” and “—Executive Compensation.”

We have entered into indemnity agreements with our directors and executive officers. These indemnity agreements and our amended and restated certificate of incorporation and amended and restated bylaws will indemnify each of our directors and officers to the fullest extent permitted by Delaware General Corporation Law. For a description of these agreements, see the section titled “Executive and Director Compensation—Limitation of Liability and Indemnification.”

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PRINCIPAL STOCKHOLDERS

The following table sets forth the beneficial ownership of our common stock as of September 30, 2007 by:

• each person, or group of affiliated persons, who is known by us to beneficially own more than 5% of our common stock;

• each of the named executive officers;

• each of our directors; and

• all of our executive officers and directors as a group.

The percentage ownership information shown in the table is based upon 186,063,970 shares outstanding as of September 30, 2007, assuming the conversion of all outstanding shares of our preferred stock as of September 30, 2007, and the issuance of              shares of common stock in this offering. The percentage ownership information assumes no exercise of the underwriters’ overallotment option and does not give effect to the exercise of warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering. The shares issuable upon exercise of these warrants, however, are included with respect to the holders of these warrants listed in the table below as described in the following paragraph.

Information with respect to beneficial ownership has been furnished by each director, officer or beneficial owner of more than 5% of our common stock. We have determined beneficial ownership in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities. In addition, the rules include shares of common stock issuable pursuant to the exercise of stock options or warrants that are either immediately exercisable or exercisable on or before November 29, 2007, which is 60 days after September 30, 2007. These shares are deemed to be outstanding and beneficially owned by the person holding those options or a warrant for the purpose of computing the percentage ownership of that person, but they are not treated as outstanding for the purpose of computing the percentage ownership of any other person. Unless otherwise indicated, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown as beneficially owned by them, subject to applicable community property laws.

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Except as otherwise noted below, the address for person or entity listed in the table is c/o Danger, Inc., 3101 Park Blvd., Palo Alto, California 94306.

Name of Beneficial Owner	Number of Shares Beneficially Owned	Percentage of Shares Beneficially Owned
		Before Offering		After Offering
5% Stockholders:
Mobius Technology Ventures and affiliated entities(1) 1050 Walnut Street, Suite 210 Boulder, CO 80302	33,221,247	17.6	%
Redpoint Ventures and affiliated entities(2) 3000 Sand Hill Road Building 2, Suite 290 Menlo Park, CA 94025	27,878,719	14.8	%
T-Mobile Venture Fund GmbH & Co. KG Gotenstr, 156 53175 Bonn, Germany	24,085,561	12.6	%
SOFTBANK Capital and affiliated entities(3) 1188 Centre Street Newton Center, MA 02459	23,964,394	12.7	%
Motorola, Inc. 1303 East Algonquin Road Schaumberg, IL 60196	21,582,549	11.2	%
Meritech Capital Partners and affiliated entities(4) 245 Lytton Avenue, Suite 350 Palo Alto, CA 94301	14,684,078	7.8	%
Venture Strategy Partners and affiliated entities(5) 201 Post Street, Suite 1100 San Francisco, CA 94108	11,545,600	6.2	%
Named Executive Officers and Directors:
Henry R. Nothhaft(6)	10,323,778	5.3	%
Jeffrey D. Brody(7)	28,128,719	14.9	%
Gregory P. Galanos(8)	33,471,247	17.7	%
Richard S. Gilbert(9)	250,000	*
Eric Hippeau(10)	24,214,394	12.8	%
Albert A. “Rocky” Pimentel(11)	250,000	*
Nancy J. Hilker(12)	1,808,189	1.0	%
Joe F. Britt, Jr.(13)	6,034,539	3.2	%
Mark W. Fisher(14)	1,809,000	1.0	%
Matt Hershenson(15)	5,939,000	3.2	%
James L. Isaacs(16)	1,809,000	1.0	%
All executive officers and directors as a group (14 persons)(17)	117,555,866	53.9	%

* Represents beneficial ownership of less than 1%.

(1) Consists of (i) 14,252,186 shares held by Mobius Technology Ventures VI, L.P., (ii) 1,182,409 shares of common stock issuable upon exercise of warrants held by Mobius Technology Ventures VI, L.P. that are exercisable within 60 days after September 30, 2007, (iii) 15,285,975 shares held by SOFTBANK U.S. Ventures Fund VI, L.P., (iv) 1,268,175 shares of common stock issuable upon exercise of warrants held by

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SOFTBANK U.S. Ventures Fund VI, L.P. that are exercisable within 60 days after September 30, 2007, (v) 555,239 shares held by Mobius Technology Ventures Advisors Fund VI, L.P., (vi) 46,063 shares of common stock issuable upon exercise of warrants held by Mobius Technology Ventures Advisors Fund VI, L.P. that are exercisable within 60 days after September 30, 2007, (vii) 582,847 shares held by Mobius Technology Ventures Side Fund VI, L.P. and (viii) 48,353 shares of common stock issuable upon exercise of warrants held by Mobius Technology Ventures Side Fund VI, L.P. that are exercisable within 60 days after September 30, 2007. Mr. Galanos, one of our directors, is a managing director of Mobius Technology Ventures and disclaims beneficial ownership of these shares except to the extent of his pecuniary interest in them.

(2) Consists of (i) 24,257,999 shares held by Redpoint Ventures II, L.P. (ii) 2,089,296 shares of common stock issuable upon exercise of warrants held by Redpoint Ventures II, L.P. that are exercisable within 60 days after September 30, 2007, (iii) 663,999 shares held by Redpoint Associates II, LLC, (iv) 53,038 shares of common stock issuable upon exercise of warrants held by Redpoint Associates II, LLC that are exercisable within 60 days after September 30, 2007, (v) 702,137 shares held by Redpoint Technology Partners Q-1, L.P. and (vi) 112,250 shares held by Redpoint Technology Partners A-1, L.P. Mr. Brody, one of our directors, is a managing director of Redpoint Ventures and disclaims beneficial ownership of these shares except to the extent of his pecuniary interest in them.

(3) Consists of (i) 10,418,889 shares held by SOFTBANK Capital Partners LP (ii) 1,562,833 shares of common stock issuable upon exercise of warrants held by SOFTBANK Capital Partners LP that are exercisable within 60 days after September 30, 2007, (iii) 179,836 shares held by SOFTBANK Capital Advisors Fund LP, (iv) 26,972 shares of common stock issuable upon exercise of warrants held by SOFTBANK Capital Advisors Fund LP that are exercisable within 60 days after September 30, 2007, (v) 10,239,884 shares held by SOFTBANK Capital LP, and (vi) 1,535,980 shares of common stock issuable upon exercise of warrants held by SOFTBANK Capital LP that are exercisable within 60 days after September 30, 2007. Mr. Hippeau, one of our directors, is a managing partner of SOFTBANK Capital and disclaims beneficial ownership of these shares except to the extent of his pecuniary interest in them.

(4) Consists of (i) 12,356,336 shares held by Meritech Capital Partners II L.P.; (ii) 1,853,449 shares of common stock issuable upon exercise of warrants held by Meritech Capital Partners II L.P. that are exercisable within 60 days after September 30, 2007; (iii) 317,941 shares held by Meritech Capital Affiliates II L.P.; (iv) 47,691 shares of common stock issuable upon exercise of warrants held by Meritech Capital Affiliates II L.P. that are exercisable within 60 days after September 30, 2007; (v) 94,489 shares held by MCP Entrepreneur Partners II L.P.; and (vi) 14,172 shares of common stock issuable upon exercise of warrants held by MCP Entrepreneur Partners II L.P. that are exercisable within 60 days after September 30, 2007. Meritech Management Associates II L.L.C., a managing member of Meritech Capital Associates II L.L.C., the general partner of Meritech Capital Partners II L.P., Meritech Capital Affiliates II L.P. and MCP Entrepreneur Partners II L.P., has sole voting and dispositive power with respect to the shares held by Meritech Capital Partners II L.P., Meritech Capital Affiliates II L.P. and MCP Entrepreneur Partners II L.P. The managing members of Meritech Management Associates II L.L.C. are Paul S. Madera and Michael B. Gordon, who disclaim beneficial ownership of these shares except to the extent of their pecuniary interest therein.

(5) Consists of (i) 9,881,601 shares held by Venture Strategy Partners II, LP, (ii) 957,121 shares of common stock issuable upon exercise of warrants held by Venture Strategy Partners II, LP that are exercisable within 60 days after September 30, 2007, (iii) 640,889 shares held by Venture Strategy Affiliates II, LP and (iv) 65,989 shares of common stock issuable upon exercise of warrants held by Venture Strategy Affiliates II, LP that are exercisable within 60 days after September 30, 2007.

(6) Consists of shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(7) Consists of (i) 27,878,719 shares held by, and issuable upon exercise of warrants held by, entities affiliated with Redpoint Ventures and (ii) 250,000 shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

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(8) Consists of (i) 33,221,247 shares held by, and issuable upon exercise of warrants held by, entities affiliated with Mobius Technology Ventures and (ii) 250,000 shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(9) Consists of shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(10) Consists of (i) 23,964,394 shares held by, and issuable upon exercise of warrants held by, entities affiliated with SOFTBANK Capital Partners and (ii) 250,000 shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(11) Consists of shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(12) Consists of shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(13) Consists of (i) 3,850,000 shares held by Joe F. Britt, Jr., or his successor, as Trustee of The Joe Freeman Britt, Jr. Revocable Living Trust UTA dated May 30, 2003, (ii) 150,000 shares held by Yumie Sonoda Britt, or her successor, as Trustee of The Britt Irrevocable Children’s Trust UTA dated July 14, 2006, (iii) 95,539 shares held by Mr. Britt, and (iv) 1,939,000 shares of common stock issuable upon exercise of stock options held by Mr. Britt that are exercisable within 60 days after September 30, 2007.

(14) Consists of shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(15) Consists of (i) 4,000,000 shares held by Mr. Hershenson and (ii) 1,939,000 shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(16) Consists of shares of common stock issuable upon exercise of stock options that are exercisable within 60 days after September 30, 2007.

(17) Includes options and warrants exercisable for an aggregate of 32,209,086 shares of common stock within 60 days of September 30, 2007 held by our current executive officers and directors.

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DESCRIPTION OF CAPITAL STOCK

General

The following is a summary of our capital stock and certain provisions of our amended and restated certificate of incorporation and amended and restated bylaws, as they will be in effect upon the closing of this offering. This summary does not purport to be complete and is qualified in its entirety by the provisions of our amended and restated certificate of incorporation and amended and restated bylaws, copies of which have been filed as exhibits to the registration statement of which this prospectus is a part.

Following the closing of this offering, our authorized capital stock will consist of 200,000,000 shares of common stock, par value $0.0001 per share, and 20,000,000 shares of preferred stock, par value $0.0001 per share.

Common Stock

Outstanding Shares.    Based on 17,930,106 shares of common stock outstanding as of September 30, 2007 and the conversion of outstanding preferred stock as of September 30, 2007 into 168,133,864 shares of common stock upon the completion of this offering, assuming no outstanding options are exercised prior to the closing of this offering, and the issuance of              shares of common stock in this offering, there will be              shares of common stock outstanding upon the closing of this offering (including              shares of common stock to be issued upon the exercise of outstanding warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, assuming a deemed market price equal to the assumed initial public offering price of $              per share, and              shares of common stock to be issued upon the exercise of other outstanding warrants for cash that will terminate if not exercised prior to the closing of this offering). As of September 30, 2007, assuming the conversion of all outstanding preferred stock into common stock upon the closing of this offering, we had approximately 208 record holders of our common stock.

As of September 30, 2007, there were 25,936,605 shares of common stock issuable upon exercise of outstanding warrants, assuming the conversion of all outstanding preferred stock into common stock upon the closing of this offering, and 42,861,396 shares of common stock subject to outstanding options.

Voting Rights.    Each holder of common stock is entitled to one vote for each share on all matters submitted to a vote of the stockholders, including the election of directors provided, however, that except as otherwise required by law, holders of common stock shall not be entitled to vote on any amendment to the certificate of incorporation that relates solely to the terms of one or more outstanding series of preferred stock if the holders of such affected series are entitled to vote. Our amended and restated certificate of incorporation and amended and restated bylaws do not provide for cumulative voting rights. Because of this, the holders of a majority of the shares of common stock entitled to vote in any election of directors can elect all of the directors standing for election, if they should so choose.

Dividends.    Subject to preferences that may be applicable to any then outstanding preferred stock, holders of common stock are entitled to receive dividends, if any, as may be declared from time to time by our board of directors out of legally available funds.

Liquidation.    In the event of our liquidation, dissolution or winding up, holders of common stock will be entitled to share ratably in the net assets legally available for distribution to stockholders after the payment of all of our debts and other liabilities and the satisfaction of any liquidation preference granted to the holders of any then outstanding shares of preferred stock.

Rights and Preferences.    Holders of common stock have no preemptive, conversion, subscription or other rights, and there are no redemption or sinking fund provisions applicable to the common stock. The rights, preferences and privileges of the holders of common stock are subject to and may be adversely affected by, the rights of the holders of shares of any series of preferred stock that we may designate in the future.

Fully Paid and Nonassessable.    All of our outstanding shares of common stock are, and the shares of common stock to be issued pursuant to this offering will be, fully paid and nonassessable.

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Preferred Stock

Upon the closing of this offering, all outstanding shares of preferred stock will have been converted into shares of common stock.

As of September 30, 2007, there were 148,902,132 shares of our preferred stock outstanding, consisting of 9,907,407 shares of Series A preferred stock, 12,249,932 shares of Series B-1 preferred stock, 15,726,655 shares of Series C preferred stock, 39,136,220 shares of Series D preferred stock, 63,044,509 shares of Series D' preferred stock and 8,837,409 shares of Series E preferred stock. Upon completion of this offering, all currently outstanding shares of preferred stock will be converted into 168,133,864 shares of common stock and will no longer be issued and outstanding. All outstanding shares of our Series A preferred stock, Series C preferred stock, Series D preferred stock and Series E preferred stock will convert into shares of our common stock on a one-for-one basis upon the closing of this offering. Each outstanding share of our Series B-1 preferred stock will convert into approximately 1.0323 shares of our common stock upon the closing of this offering and each share of Series D' preferred stock will convert into approximately 1.2988 shares of our common stock upon the closing of this offering.

Under the amended and restated certificate of incorporation to be effective upon completion of this offering, our board of directors will have the authority, without further action by the stockholders, to issue up to 20,000,000 shares of preferred stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the rights, preferences and privileges of the shares of each wholly unissued series and any qualifications, limitations or restrictions thereon, and to increase or decrease the number of shares of any such series, but not below the number of shares of such series then outstanding. The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in control of our company without further action by the stockholders and may adversely affect the voting and other rights of the holders of common stock. The issuance of preferred stock with voting and conversion rights may adversely affect the voting power of the holders of common stock, including the loss of voting control to others. At present, we have no plans to issue any of the preferred stock.

Warrants

As of September 30, 2007, warrants to purchase 21,498,697 shares of our preferred stock were outstanding, consisting of:

• a warrant to purchase 68,512 shares of Series B-1 preferred stock at an exercise price of $1.3741 per share;

• warrants to purchase an aggregate of 544,798 shares of Series C preferred stock at an exercise price of $0.01 per share;

• warrants to purchase an aggregate of 5,910,319 shares of Series D preferred stock at an exercise price of $0.9007 per share;

• warrants to purchase an aggregate of 14,846,368 shares of Series D' preferred stock at an exercise price of $0.9007 per share; and

• a warrant to purchase 128,700 shares of Series E preferred stock at an exercise price of $1.1655 per share.

In connection with the conversion of all of our outstanding shares of preferred stock into common stock upon the closing of this offering:

• the warrant to purchase 68,512 shares of Series B-1 preferred stock will automatically become exercisable for 70,724 shares of common stock;

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• warrants to purchase 544,798 shares of Series C preferred stock and 5,910,319 shares of Series D preferred stock will become exercisable for an aggregate of 6,455,117 shares of common stock, of which warrants to purchase 6,415,222 of common stock will terminate if not exercised prior to the closing of this offering; and

• warrants to purchase 14,846,368 shares of Series D' preferred stock and 128,700 shares of Series E preferred stock will become exercisable for an aggregate of 19,410,764 shares of common stock, all of which warrants will be automatically exercised on a cashless basis immediately prior to the closing of this offering if not exercised sooner by the holders of these warrants.

Each of our warrants contains a cashless exercise provision under which the holder may, in lieu of payment of the exercise price in cash, surrender the warrant and receive a net amount of shares based on the fair market value of our common stock at the time of exercise of the warrant after deduction of the aggregate exercise price. Each of our warrants also contains provisions for the adjustment of the exercise price and the aggregate number of shares issuable upon the exercise of the warrant in the event of stock dividends, stock splits, reorganizations, reclassifications and consolidations.

With respect to the warrants to purchase Series D' preferred stock and Series E preferred stock that will be automatically exercised on a cashless basis immediately prior to the closing of this offering, the fair market value of our common stock will be determined by reference to a deemed market price of our common stock immediately prior to the date of exercise, which deemed market price will be based in part on the trading price of our common stock prior to the closing of this offering and in part based on our board of directors’ determination of the fair market value of our common stock. Assuming that the deemed market price of our common stock is equal to the assumed initial public offering price of $             per share immediately prior to the date of exercise, we would issue              shares of our common stock upon the automatic cashless exercise of these warrants, after giving effect to the conversion of all of our outstanding shares of preferred stock into common stock. A $             increase in the assumed deemed market price of $             per share would increase the number of              shares of common stock to be issued upon the automatic cashless exercise of these warrants by approximately              shares of common stock, and a $             decrease in the assumed deemed market price of $             per share would decrease the number of shares of common stock to be issued upon the automatic cashless exercise of these warrants by approximately              shares of common stock.

The holders of the shares issuable upon exercise of our warrants are entitled to registration rights with respect to such shares as described in greater detail under the heading “Registration Rights.”

Registration Rights

Following the closing of this offering, the holders of an aggregate of             shares of our common stock issuable upon the conversion of our convertible preferred stock (including shares of common stock to be issued upon the exercise of outstanding warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, assuming a deemed market price equal to the assumed initial public offering price of $             per share, and             shares of common stock to be issued upon the exercise of other outstanding warrants for cash that will terminate if not exercised prior to the closing of this offering), will be entitled to the “Demand,” “Piggyback” and “Form S-3” registration rights set forth below with respect to registration of the resale of such shares under the Securities Act pursuant to an investors’ rights agreement by and among us and certain of our stockholders. In addition, following the closing of this offering, the holders of warrants to purchase an additional              shares of our common stock will also be entitled to certain registration rights. Finally, the holders of an aggregate of 9,744,849 shares of our common stock, specifically founders shares purchased by Messrs. Britt and Hershenson, will be entitled to the “Piggyback” registration rights set forth below. As applicable, we refer to these shares collectively as registrable securities.

Registration of shares of common stock in response to exercise of the following rights would result in the holders being able to trade these shares without restriction under the Securities Act when the applicable

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registration statement is declared effective. We generally must pay all expenses, other than underwriting discounts, taxes and commissions, related to any registration effected pursuant to the exercise of these registration rights.

The registration rights terminate upon the earlier of five years after completion of this offering, or with respect to the registration rights of an individual holder, when the holder of one percent or less of our outstanding common stock can sell all of such holder’s registrable securities in any three-month period without registration, in compliance with Rule 144 of the Securities Act or another similar exception.

Demand Registration Rights.    If, at any time after the earlier to occur of six months after the effective date of the registration statement for this offering or October 2, 2009, the holders of at least 50% of the registrable securities or 20% of the registrable securities that were originally shares of our Series D preferred stock and Series D' preferred stock request in writing that an amount of securities having an aggregate offering price of not less than $5,000,000 be registered, we may be required to register their shares. We are only obligated to effect two registrations in response to these demand registration rights for the holders of registrable securities. Depending on certain conditions, however, we may defer such registration for up to 90 days. The underwriters of any underwritten offering have the right to limit the number of shares registered by these holders for marketing reasons.

Piggyback Registration Rights.    If at any time we propose to register any shares of our common stock under the Securities Act after this offering, subject to certain exceptions, the holders of registrable securities will be entitled to notice of the registration and to include their share of registrable securities in the registration. The underwriters of any underwritten offering have the right to limit the number of shares registered by these holders for marketing reasons, but not below 30% of the total number of shares included in the registration statement.

Form S-3 Registration Rights.    At any time after we are qualified to file a registration statement on Form S-3, the holders of at least 25% of the registrable securities may request in writing that we effect a registration on Form S-3 under the Securities Act, and when the proposed aggregate offering price of the shares to be registered by the holders requesting registration is at least $1,000,000, subject to certain exceptions. We are obligated to file up to two registration statements on Form S-3 in any 12-month period.

Expenses of Registration.    We will pay all expenses, other than underwriting discounts and commissions, relating to all demand registrations, Form S-3 registrations and piggyback registrations.

Anti-Takeover Effects of Our Charter and Bylaws and Delaware Law

Some provisions of Delaware law and our amended and restated certificate of incorporation and amended and restated bylaws could make the following transactions more difficult:

• acquisition of our company by means of a tender offer, a proxy contest or otherwise; and

• removal of our incumbent officers and directors.

These provisions, summarized below, are expected to discourage and prevent coercive takeover practices and inadequate takeover bids. These provisions are designed to encourage persons seeking to acquire control of our company to first negotiate with our board of directors. They are also intended to provide our management with the flexibility to enhance the likelihood of continuity and stability if our board of directors determines that a takeover is not in our best interests or the best interests of our stockholders. These provisions, however, could have the effect of discouraging attempts to acquire us, which could deprive our stockholders of opportunities to sell their shares of common stock at prices higher than prevailing market prices. We believe that the benefits of these provisions, including increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure our company, outweigh the disadvantages of discouraging takeover proposals, because negotiation of takeover proposals could result in an improvement of their terms.

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Classified Board.    Our amended and restated certificate of incorporation that will become effective as of the closing of this offering provides for a classified board of directors consisting of three classes of directors, each serving a staggered three-year term. Commencing in 2009, a portion of our board of directors will be elected each year for three-year terms. Upon the closing of this offering:

• Messrs. Brody and Nothhaft will be designated Class I directors whose term will expire at the 2009 annual meeting of stockholders;

• Messrs. Britt and Hippeau will be designated Class II directors whose term will expire at the 2010 annual meeting of stockholders; and

• Messrs. Galanos, Gilbert and Pimentel will be designated Class III directors whose term expires at the 2011 annual meeting of stockholders.

Election and Removal of Directors.    Our amended and restated certificate of incorporation and our amended and restated bylaws contain provisions that establish specific procedures for appointing and removing members of the board of directors unless otherwise determined by a board resolution. Under our amended and restated certificate of incorporation and amended and restated bylaws, subject to the rights of the holders of any series of preferred stock, vacancies and newly created directorships on the board of directors may be filled only by a majority of the directors then serving on the board, unless determined by board resolution that any such vacancies or newly created directorships shall be filled by stockholders. Under our amended and restated certificate of incorporation and amended and restated bylaws, directors may be removed by the stockholders only for cause.

Special Stockholder Meetings.    Under our amended and restated bylaws, only the chairperson of our board of directors, our chief executive officer or a majority of the authorized number of our directors may call special meetings of stockholders.

Requirements for Advance Notification of Stockholder Nominations and Proposals.    Our amended and restated bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors.

Delaware Anti-Takeover Law.    We are subject to Section 203 of the Delaware General Corporation Law, which is an anti-takeover law. In general, Section 203 prohibits a publicly-held Delaware corporation from engaging in a business combination with an interested stockholder for a period of three years following the date that the person became an interested stockholder, unless the business combination or the transaction in which the person became an interested stockholder is approved in a prescribed manner. Generally, a business combination includes a merger, asset or stock sale, or another transaction resulting in a financial benefit to the interested stockholder. Generally, an interested stockholder is a person who, together with affiliates and associates, owns, or within three years prior to the date of determination of interested stockholder status did own, 15% or more of the corporation’s voting stock. The existence of this provision may have an anti-takeover effect with respect to transactions that are not approved in advance by our board of directors, including discouraging attempts that might result in a premium over the market price for the shares of common stock held by stockholders.

Elimination of Stockholder Action by Written Consent.    Our amended and restated certificate of incorporation and amended and restated bylaws eliminate the right of stockholders to act by written consent without a meeting.

No Cumulative Voting.    Our amended and restated certificate of incorporation and amended and restated bylaws do not provide for cumulative voting in the election of directors. Cumulative voting allows a minority stockholder to vote a portion or all of its shares for one or more candidates for seats on the board of directors. Without cumulative voting, a minority stockholder will not be able to gain as many seats on our board of directors based on the number of shares of our stock the stockholder holds as the stockholder would be able to gain if cumulative voting were permitted. The absence of cumulative voting makes it more difficult for a minority stockholder to gain a seat on our board of directors to influence our board of director’s decision regarding a takeover.

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Undesignated Preferred Stock.    The authorization of undesignated preferred stock makes it possible for our board of directors to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to change control of our company.

These and other provisions may have the effect of deferring hostile takeovers or delaying changes in control or management.

Transfer Agent and Registrar

The transfer agent and registrar for our common stock will be                    . Their address is                         .

NASDAQ Global Market Listing

We have applied to list our common stock on the NASDAQ Global Market under the symbol “DNGR.”

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for our common stock, and we cannot assure you that a significant public market for our common stock will develop or be sustained after this offering. As described below, no shares currently outstanding will be available for sale immediately after this offering due to certain contractual and securities law restrictions on resale. Sales of substantial amounts of our common stock in the public market after the restrictions lapse could cause the prevailing market price to decline and limit our ability to raise equity capital in the future.

Based on the number of shares of common stock outstanding as of September 30, 2007, upon completion of this offering, and assuming no outstanding options are exercised prior to the closing of this offering, we will have outstanding an aggregate of             shares of common stock (including             shares of common stock to be issued upon the exercise of outstanding warrants that, by their terms, provide for automatic exercise on a cashless basis immediately prior to the closing of this offering, assuming a deemed market price equal to the assumed initial public offering price of $             per share, and             shares of common stock to be issued upon the exercise of other outstanding warrants for cash that will terminate if not exercised prior to the closing of this offering), assuming no exercise of the underwriters’ option to purchase additional shares. All of the shares of common stock being sold in this offering will be freely tradable without restriction or further registration under the Securities Act unless purchased by our affiliates as defined in Rule 144 under the Securities Act of 1933, as amended. Except as set forth below, the remaining shares of common stock outstanding after this offering will be restricted as a result of securities laws or lock-up agreements. These remaining shares will generally become available for sale in the public market as follows:

• none of the restricted shares of common stock will be eligible for immediate sale upon the closing of this offering; and

• all of the restricted shares of common stock, less shares subject to a repurchase option in our favor tied to the holders’ continued service to us (which will be eligible for sale upon lapse of the repurchase option), will be eligible for sale under Rule 144 or Rule 701 upon expiration of lock-up agreements 180 days after the date of this prospectus, unless the lock-up is otherwise extended.

Lock-up Agreements

Each of our officers and directors, and substantially all of our stockholders and holders of options and warrants to purchase our stock, have agreed or are expected to agree, subject to certain exceptions, not to offer, sell, contract to sell or otherwise dispose of, or enter into any transaction that is designed to, or could be expected to, result in the disposition of any shares of our common stock or other securities convertible into or exchangeable or exercisable for shares of our common stock or derivatives of our common stock owned by these persons prior to this offering or common stock issuable upon exercise of options or warrants held by these persons for a period of 180 days after the effective date of the registration statement of which this prospectus is a part without the prior written consent of Deutsche Bank Securities Inc. and UBS Securities LLC. This consent may be given at any time without public notice. Subject to certain exceptions, transfers or dispositions can be made during the lock-up period in the case of, among certain other exceptions, (a) sales of shares of our common stock acquired in open market transactions by an individual after the completion of the public offering, provided, however, that no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) shall be required or shall be voluntarily made in connection with such sales or (b) transfers of any of our securities if the transfer is (i) by gift, will or intestacy, (ii) to any trust for the direct or indirect benefit of the holder of the securities or the immediate family of the holder or a charitable organization, or (iii) a distribution to partners, former partners, members, former members, shareholders or subsidiaries of the undersigned, where the donee or the transferee signs a lock-up agreement. We have entered into a similar agreement with the representatives of the underwriters. There are no agreements between the representatives and any of our stockholders or affiliates releasing them from these lock-up agreements prior to the expiration of the 180-day period.

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The 180-day restricted period described in the preceding paragraph will be extended if:

• during the last 17 days of the 180-day restricted 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 restricted period, we announce that we will release earnings results during the 16-day period beginning on the last day of the 180-day restricted period,

in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or occurrence of a material event, unless such extension is waived in writing by Deutsche Bank Securities Inc. and UBS Securities LLC.

Rule 144

Under Rule 144 as currently in effect, beginning 90 days after the date of this prospectus, a person who may be deemed to have been one of our affiliates at any time during the three months preceding a sale and who has beneficially owned restricted shares for at least six months, including the holding period of any prior owner except an affiliate, would be entitled to sell within any three month period a number of shares that does not exceed the greater of:

• 1% of the number of shares of common stock then outstanding that will equal approximately             shares immediately after this offering; or

• the average weekly trading volume of the common stock during the four calendar weeks preceding the filing of a Form 144 with respect to such sale.

Sales by affiliates under Rule 144 are also subject to certain manner of sale provisions and notice requirements and to the availability of current public information about us.

In addition, beginning 90 days after the date of this prospectus, a person who is not deemed to have been one of our affiliates at any time during the three months preceding a sale and who has beneficially owned restricted shares for at least six months but less than one year, including the holding period of any prior owner except an affiliate, is entitled to sell such shares without complying with the manner of sale, volume limitation or notice provisions of Rule 144, provided the current public information provisions of Rule 144(c) are satisfied. An unaffiliated person who has beneficially owned restricted shares for at least one year, including the holding period of any prior owner except an affiliate, is entitled to sell such shares without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144.

Rule 701

Rule 701, as currently in effect, permits resales of shares in reliance upon Rule 144 but without compliance with certain restrictions, including the holding period requirement, of Rule 144. Any employee, officer or director of or consultant to us who purchased shares under a written compensatory plan or contract may be entitled to rely on the resale provisions of Rule 701. Rule 701 permits affiliates to sell their Rule 701 shares under Rule 144 without complying with the holding period requirements of Rule 144. Rule 701 further provides that non-affiliates may sell such shares in reliance on Rule 144 without having to comply with the holding period, public information, volume limitation or notice provisions of Rule 144. All holders of Rule 701 shares are required to wait until 90 days after the date of this prospectus before selling such shares. All Rule 701 shares are, however, subject to lock-up agreements and will only become eligible for sale upon the expiration of the 180-day lock up agreements. Deutsche Bank Securities Inc. and UBS Investment Bank LLC may, in their sole discretion and at any time without notice, release all or any portion of the securities subject to lock up agreements.

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Registration Rights

Upon the closing of this offering, the holders of             shares of our common stock and the holders of warrants to purchase              shares of our common stock have the right to have their shares registered under the Securities Act. See the section titled “Description of Capital Stock—Registration Rights.” All such shares are covered by lock-up agreements. Following the expiration of the lock-up period, registration of these shares under the Securities Act would result in the shares becoming freely tradable without restriction under the Securities Act immediately upon the effectiveness of the registration, except for shares purchased by our affiliates.

We have agreed not to file any registration statements during the 180-day period after the date of this prospectus with respect to the registration of any shares of common stock or any securities convertible into or exercisable or exchangeable into common stock, other than one or more registration statements on Form S-8 covering securities issuable under our stock plans, without the prior written consent of Deutsche Bank Securities Inc. and UBS Investment Bank LLC.

Equity Incentive Plans

Following the effective date of this offering, we intend file a Registration Statement on Form S-8 registering shares of common stock outstanding, subject to outstanding options or reserved for future issuance under our stock plans. As of September 30, 2007, options to purchase a total of 42,861,396 shares were outstanding and 2,056,194 shares were reserved for future issuance under our 2000 Stock Option/Stock Issuance Plan. Effective on the date of this offering, we will have             shares reserved for issuance under our 2008 Equity Incentive Plan and             shares of common stock reserved for issuance under our 2008 Employee Stock Purchase Plan. See the section titled “Executive and Director Compensation—Employment Agreements and Arrangements—Employee Benefit Plans and Arrangements.” Subject to the lock-up agreements described above and any applicable vesting restrictions, shares registered under these registration statements will be available for resale in the public market immediately upon the effectiveness of these registration statements, except with respect to Rule 144 volume limitations that apply to our affiliates.

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MATERIAL UNITED STATES FEDERAL TAX CONSIDERATIONS

FOR NON-UNITED STATES HOLDERS OF COMMON STOCK

The following is a general discussion of the material U.S. federal income and estate tax consequences of the ownership and disposition of our common stock by a non-U.S. holder. For purposes of this discussion, you are a “non-U.S. holder” if you are a beneficial owner of our common stock and you are not, for U.S. federal income tax purposes:

• an individual who is a citizen or resident of the U.S.;

• a corporation (or an entity electing to be taxed as a corporation) created or organized in or under the laws of the U.S., or of any political subdivision of the U.S.;

• an estate whose income is subject to U.S. federal income taxation regardless of its source; or

• a trust, in general, if a U.S. court is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have authority to control all substantial decisions of the trust or if the trust has made a valid election to be treated as a U.S. person under applicable U.S. Treasury regulations.

If you are an individual, you may be treated as a resident of the U.S. in any calendar year for U.S. federal income tax purposes, instead of a nonresident, by, among other ways, being present in the U.S. for at least 31 days in that calendar year and for an aggregate of at least 183 days during a three-year period ending in the current calendar year. For purposes of this calculation, you would count all of the days present in the current year, one-third of the days present in the immediately preceding year and one-sixth of the days present in the second preceding year. Residents are taxed for U.S. federal income tax purposes as if they were U.S. citizens. If a partnership or other flow-through entity is a beneficial owner of our common stock, the tax treatment of a partner in the partnership or owner of the entity will generally depend on the status of the partner or owner and the activities of the partnership or entity. Such holders and their partners or owners should consult their own tax advisors regarding U.S. federal, state, local and non-U.S. income and other tax consequences of acquiring, holding and disposing of shares of our common stock.

This discussion does not purport to address all aspects of U.S. federal income and estate taxes or specific facts and circumstances that may be relevant to a particular non-U.S. holder’s tax position, including:

• U.S. state or local or any non-U.S. tax consequences;

• the tax consequences for the stockholders, partners or beneficiaries of a non-U.S. holder;

• special tax rules that may apply to particular non-U.S. holders, such as financial institutions, insurance companies, tax-exempt organizations, U.S. expatriates, broker-dealers and traders in securities; and special tax rules that may apply to a non-U.S. holder that holds our common stock as part of a “straddle,” “hedge,” “conversion transaction,” “synthetic security” or integrated investment.

The following discussion is based on provisions of the U.S. Internal Revenue Code of 1986, as amended, existing and proposed U.S. Treasury regulations and administrative and judicial interpretations, all as of the date of this prospectus, and all of which are subject to change, possibly with retroactive effect. The following summary assumes that you hold our common stock as a capital asset. Each non-U.S. holder should consult a tax advisor regarding the U.S. federal, state, local and non-U.S. income and other tax consequences of acquiring, holding and disposing of shares of our common stock.

Dividends

We do not anticipate paying cash dividends on our common stock in the foreseeable future. See “Dividend Policy.” In the event, however, that we pay dividends (out of earnings and profits) on our common stock, we will have to withhold a U.S. federal withholding tax at a rate of 30%, or a lower rate under an applicable income tax

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treaty, from the gross amount of the dividends paid to you. You should consult your tax advisors regarding your entitlement to benefits under a relevant income tax treaty. Generally, in order for us to withhold tax at a lower treaty rate, you must provide us with a properly executed Internal Revenue Service Form W-8BEN certifying your eligibility for the lower treaty rate. However:

• in the case of common stock held by a foreign partnership, the certification requirement will generally be applied to partners and the partnership will be required to provide certain information;

• in the case of common stock held by a foreign trust, the certification requirement will generally be applied to the trust or the beneficial owners of the trust, depending on whether the trust is a “foreign complex trust,” “foreign simple trust” or “foreign grantor trust” as defined in the U.S. Treasury regulations; and

• look-through rules apply for tiered partnerships, foreign simple trusts and foreign grantor trusts.

A non-U.S. holder that is a foreign partnership or a foreign trust is urged to consult its tax advisor regarding its status under these U.S. Treasury regulations and the certification requirements applicable to it.

If you are eligible for a reduced rate of U.S. federal withholding tax under an income tax treaty, you may obtain a refund or credit of any excess amounts withheld by filing an appropriate claim for a refund with the U.S. Internal Revenue Service.

If the dividend is effectively connected with your conduct of a trade or business in the U.S. and, if an income tax treaty applies, is attributable to a permanent establishment that you maintain in the U.S., the dividend will generally be exempt from the U.S. federal withholding tax, provided that you supply us with a properly executed Internal Revenue Service Form W-8ECI. In this case, the dividend will be taxed on a net income basis at the regular graduated rates and in the manner applicable to U.S. persons and, if you are a foreign corporation, you may be subject to an additional branch profits tax at a rate of 30% or a lower rate as may be specified by an applicable income tax treaty.

Gain on Dispositions of Common Stock

You generally will not be subject to U.S. federal income tax on gain recognized on a disposition of our common stock unless:

• the gain is effectively connected with your conduct of a trade or business in the U.S. and, if an income tax treaty applies, the gain is attributable to a permanent establishment maintained by you in the U.S.; in this case, the gain will be taxed on a net income basis at the regular graduated rates and in the manner applicable to U.S. persons and, if you are a foreign corporation, you may be subject to an additional branch profits tax at a rate of 30% or a lower rate as may be specified by an applicable income tax treaty;

• you are an individual who is present in the U.S. for 183 days or more in the taxable year of the disposition and meets other requirements; or

• we are or have been a “U.S. real property holding corporation” for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of disposition or the period that you held our common stock; in this case, subject to the discussion below, the gain will be taxed on a net income basis in the manner described in the first bullet paragraph above.

Generally, a corporation is a “U.S. real property holding corporation” if the fair market value of its “U.S. real property interests” equals or exceeds 50% of the sum of the fair market value of its worldwide real property interests plus its other assets used or held for use in a trade or business. The tax relating to stock in a “U.S. real property holding corporation” generally will not apply to a non-U.S. holder whose holdings, direct and indirect, at all times during the applicable period, constituted 5% or less of our common stock, provided that our

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common stock was regularly traded on an established securities market. We believe that we are not currently, and we do not anticipate becoming in the future, a “U.S. real property holding corporation” for U.S. federal income tax purposes.

Federal Estate Tax

Shares of our common stock owned or treated as owned by an individual who is a non-U.S. holder (as specially defined for U.S. federal estate tax purposes) at the time of death will be included in the individual’s taxable estate for U.S. federal estate tax purposes, unless an applicable estate tax or other treaty provides otherwise and, therefore, may be subject to U.S. federal estate tax.

Information Reporting and Backup Withholding

In general, information returns will be filed with the U.S. Internal Revenue Service in connection with payments of dividends and the proceeds from a sale or other disposition of our common stock. Dividends paid to you may be subject to information reporting and U.S. backup withholding. You generally will be exempt from such backup withholding if you provide a properly executed Internal Revenue Service Form W-8BEN or otherwise meet documentary evidence requirements for establishing that you are a non-U.S. holder or otherwise establish an exemption.

The gross proceeds from the disposition of our common stock may be subject to information reporting and backup withholding. If you sell your shares of our common stock outside of the U.S. through a non-U.S. office of a non-U.S. broker and the sales proceeds are paid to you outside of the U.S., then the U.S. backup withholding and information reporting requirements generally (except as provided in the following sentence) will not apply to that payment. However, information reporting, but not backup withholding, will apply to a payment of sales proceeds, even if that payment is made outside of the U.S., if you sell our common stock through a non-U.S. office of a broker that:

• is a U.S. person;

• derives 50% or more of its gross income in specific periods from the conduct of a trade or business in the U.S.;

• is a “controlled foreign corporation” for U.S. tax purposes; or

• is a foreign partnership, if at any time during its tax year, one or more of its partners are U.S. persons who in the aggregate hold more than 50% of the income or capital interests in the partnership, or the foreign partnership is engaged in a U.S. trade or business,

unless the broker has documentary evidence in its files that you are a non-U.S. person and various other conditions are met or you otherwise establish exemption.

If you receive payments of the proceeds of a sale of our common stock to or through a U.S. office of a broker, the payment is subject to both U.S. backup withholding and information reporting unless you provide a properly executed Form W-8BEN certifying that you are a non-U.S. person and various other conditions are met or you otherwise establish an exemption.

You generally may obtain a refund of any amount withheld under the backup withholding rules that exceeds your income tax liability by filing an appropriate claim for refund with the U.S. Internal Revenue Service.

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UNDERWRITING

Subject to the terms and conditions of the underwriting agreement, the underwriters named below, through their representatives Deutsche Bank Securities Inc. and UBS Securities LLC have severally agreed to purchase from us the following respective number of shares of common stock at a public offering price less the underwriting discounts and commissions set forth on the cover page of this prospectus:

Underwriters	Number of Shares
Deutsche Bank Securities Inc.
UBS Securities LLC
Thomas Weisel Partners LLC
Pacific Crest Securities Inc.
ThinkEquity Partners LLC
Total

The underwriting agreement provides that the obligations of the several underwriters to purchase the shares of common stock offered hereby are subject to certain conditions precedent and that the underwriters will purchase all of the shares of common stock offered by this prospectus, other than those covered by the over-allotment option described below, if any of these shares are purchased.

We have been advised by the representatives of the underwriters that the underwriters propose to offer the shares of common stock to the public at the public offering price set forth on the cover of this prospectus and to dealers at a price that represents a concession not in excess of $             per share under the public offering price. The underwriters may allow, and these dealers may re-allow, a concession of not more than $             per share to other dealers. After the public offering, representatives of the underwriters may change the offering price and other selling terms.

We have granted to the underwriters an option, exercisable not later than 30 days after the date of this prospectus, to purchase up to             additional shares of common stock at the public offering price less the underwriting discounts and commissions set forth on the cover page of this prospectus. The underwriters may exercise this option only to cover over-allotments made in connection with the sale of the common stock offered by this prospectus. To the extent that the underwriters exercise this option, each of the underwriters will become obligated, subject to conditions, to purchase approximately the same percentage of these additional shares of common stock as the number of shares of common stock to be purchased by it in the above table bears to the total number of shares of common stock offered by this prospectus. We will be obligated, pursuant to the option, to sell these additional shares of common stock to the underwriters to the extent the option is exercised. If any additional shares of common stock are purchased, the underwriters will offer the additional shares on the same terms as those on which the shares are being offered.

The underwriting discounts and commissions per share are equal to the public offering price per share of common stock less the amount paid by the underwriters to us per share of common stock. The underwriting discounts and commissions are     % of the public offering price. We have agreed to pay the underwriters the following discounts and commissions, assuming either no exercise or full exercise by the underwriters of the underwriters’ over-allotment option:

	Fee per share	Total Fees
		Without Exercise of Over-Allotment Option	With Full Exercise of Over-Allotment Option
Discounts and commissions paid by us	$	$	$

In addition, we estimate that our share of the total expenses of this offering, excluding underwriting discounts and commissions, will be approximately $            .

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We have agreed to indemnify the underwriters against some specified types of liabilities, including liabilities under the Securities Act, and to contribute to payments the underwriters may be required to make in respect of any of these liabilities.

Each of our officers and directors, and substantially all of our stockholders and holders of options and warrants to purchase our stock, have agreed or are expected to agree, subject to certain exceptions, not to offer, sell, contract to sell or otherwise dispose of, or enter into any transaction that is designed to, or could be expected to, result in the disposition of any shares of our common stock or other securities convertible into or exchangeable or exercisable for shares of our common stock or derivatives of our common stock owned by these persons prior to this offering or common stock issuable upon exercise of options or warrants held by these persons for a period of 180 days after the effective date of the registration statement of which this prospectus is a part without the prior written consent of Deutsche Bank Securities Inc. and UBS Securities LLC. This consent may be given at any time without public notice. Subject to certain exceptions, transfers or dispositions can be made during the lock-up period in the case of, among certain other exceptions, (a) sales of shares of our common stock acquired in open market transactions by an individual after the completion of the public offering, provided, however, that no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) shall be required or shall be voluntarily made in connection with such sales or (b) transfers of any of our securities if the transfer is (i) by gift, will or intestacy, (ii) to any trust for the direct or indirect benefit of the holder of the securities or the immediate family of the holder or a charitable organization, or (iii) a distribution to partners, former partners, members, former members, shareholders or subsidiaries of the undersigned, where the donee or the transferee signs a lock-up agreement. We have entered into a similar agreement with the representative of the underwriters. There are no agreements between the representative and any of our stockholders or affiliates releasing them from these lock-up agreements prior to the expiration of the 180-day period.

The 180-day restricted period described in the preceding paragraph will be extended if:

• during the last 17 days of the 180-day restricted 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 restricted period, we announce that we will release earnings results during the 16-day period beginning on the last day of the 180-day restricted period,

in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or occurrence of a material event, unless such extension is waived in writing by Deutsche Bank Securities Inc. and UBS Securities LLC.

The representatives of the underwriters have advised us that the underwriters do not intend to confirm sales to any account over which they exercise discretionary authority.

In connection with the offering, the underwriters may purchase and sell shares of our common stock in the open market. These transactions may include short sales, purchases to cover positions created by short sales and stabilizing transactions.

Short sales involve the sale by the underwriters of a greater number of shares than they are required to purchase in the offering. Covered short sales are sales made in an amount not greater than the underwriters’ option to purchase additional shares of common stock from us in the offering. The underwriters may close out any covered short position by either exercising their option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to close out the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option.

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Naked short sales are any sales in excess of the over-allotment option. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if underwriters are concerned that there may be downward pressure on the price of the shares in the open market prior to the completion of the offering.

Stabilizing transactions consist of various bids for or purchases of our common stock made by the underwriters in the open market prior to the completion of the offering.

The underwriters may impose a penalty bid. This occurs when a particular underwriter repays to the other underwriters a portion of the underwriting discount received by it because the representatives of the underwriters have repurchased shares sold by or for the account of that underwriter in stabilizing or short covering transactions.

Purchases to cover a short position and stabilizing transactions may have the effect of preventing or slowing a decline in the market price of our common stock. Additionally, these purchases, along with the imposition of the penalty bid, may stabilize, maintain or otherwise affect the market price of our common stock. As a result, the price of our common stock may be higher than the price that might otherwise exist in the open market. These transactions may be effected on the Nasdaq Global Market, in the over-the-counter market or otherwise.

Pricing of the Offering

Prior to this offering, there has been no public market for our common stock. Consequently, the initial public offering price of our common stock will be determined by negotiation among us and the representatives of the underwriters. Among the primary factors that will be considered in determining the public offering price are:

• prevailing market conditions;

• our results of operations in recent periods;

• the present stage of our development;

• the market capitalizations and stages of development of other companies that we and the representative of the underwriters believe to be comparable to our business; and

• estimates of our business potential.

Electronic Distribution

A prospectus in electronic format is being made available on Internet websites maintained by one or more of the lead underwriter of this offering and may be made available on websites maintained by other underwriters. Other than the prospectus in electronic format, the information on any underwriter’s website and any information contained in any other website maintained by an underwriter is not part of the prospectus or the registration statement of which the prospectus forms a part.

Relationships with Underwriters

Certain of the underwriters and their affiliates may provide from time to time in the future certain commercial banking, financial advisory, investment banking and other services for us in the ordinary course of business, for which they may receive customary fees and commissions. In addition, from time to time, certain of the underwriters and their affiliates may effect transactions for their own accounts or the accounts of customers, and hold on behalf of themselves or their customers, long or short positions in our debt or equity securities or loans.

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Notice to Investors

European Economic Arena

In relation to each Member State of the European Economic Area, or EEA, which has implemented the Prospectus Directive (each, a Relevant Member State), with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State, or the Relevant Implementation Date, our common stock will not be offered to the public in that Relevant Member State prior to the publication of a prospectus in relation to our common stock that has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that, with effect from and including the Relevant Implementation Date, our common stock may be offered to the public in that Relevant Member State at any time:

• to legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;

• to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43 million and (3) an annual net turnover of more than €50 million, as shown in its last annual or consolidated accounts; or

• in any other circumstances which do not require the publication by us of a prospectus pursuant to Article 3 of the Prospectus Directive.

As used above, the expression “offered to the public” in relation to any of our common stock in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and our common stock to be offered so as to enable an investor to decide to purchase or subscribe for our common stock, as the same may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State and the expression “Prospectus Directive” means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State.

The EEA selling restriction is in addition to any other selling restrictions set out below.

United Kingdom

Our common stock may not be offered or sold and will not be offered or sold to any persons in the United Kingdom other than to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or as agent) for the purposes of their businesses and in compliance with all applicable provisions of the Financial Services and Markets Act 2000, or the FSMA, with respect to anything done in relation to our common stock in, from or otherwise involving the United Kingdom. In addition, each underwriter has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of Section 21 of the FSMA) received by it in connection with the issue or sale of our common stock in circumstances in which Section 21(1) of the FSMA does not apply to us. Without limiting the other restrictions referred to herein, this prospectus is directed only at (i) persons outside the United Kingdom, (ii) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005; or (iii) high net worth bodies corporate, unincorporated associations and partnerships and trustees of high value trusts as described in Article 49(2) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005. Without limiting the other restrictions referred to herein, investments or investment activity to which this prospectus relates is available only to, and will be engaged in only with, such persons. Persons within the United Kingdom who receive this communication (other than persons who fall within (ii) or (iii) above) should not rely or act upon this communication.

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LEGAL MATTERS

Selected legal matters with respect to the validity of the common stock offered by this prospectus will be passed upon for us by Cooley Godward Kronish LLP, Palo Alto, California. Wilson Sonsini Goodrich & Rosati, Professional Corporation, Palo Alto, California, is acting as counsel for the underwriters. As of the date of this prospectus, GC&H Investments, LLC, an entity comprised of partners and associates of Cooley Godward Kronish LLP, beneficially owns an aggregate of 46,296 shares of our common stock to be issued upon conversion of our preferred stock.

EXPERTS

The consolidated financial statements of Danger, Inc. and subsidiaries (“the Company”) as of September 30, 2007 and 2006, and for each of the three years in the period ended September 30, 2007, included in this prospectus have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein (which report expresses an unqualified opinion on the consolidated financial statements and includes an explanatory paragraph regarding the change in the Company’s method of accounting for stock-based compensation in accordance with Financial Accounting Standards Board Statement No. 123 (revised 2004), Share-Based Payment, as described in Note 1 to the consolidated financial statements), and have been so included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form S-1 under the Securities Act of 1933, as amended, with respect to the shares of common stock being offered by this prospectus. This prospectus does not contain all of the information in the registration statement and its exhibits. For further information with respect to Danger, Inc. and the common stock offered by this prospectus, we refer you to the registration statement and its exhibits. Statements contained in this prospectus as to the contents of any contract or any other document referred to are not necessarily complete, and in each instance, we refer you to the copy of the contract or other document filed as an exhibit to the registration statement. Each of these statements is qualified in all respects by this reference.

You can read our SEC filings, including the registration statement, over the Internet at the SEC’s website at http://www.sec.gov. You may also read and copy any document we file with the SEC at its public reference facilities at 100 F Street, N.E., Washington, D.C. 20549. You may also obtain copies of these documents at prescribed rates by writing to the Public Reference Section of the SEC at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference facilities.

Upon completion of this offering, we will be subject to the information reporting requirements of the Securities Exchange Act of 1934, as amended, and we will file reports, proxy statements and other information with the SEC. These reports, proxy statements and other information will be available for inspection and copying at the public reference room and web site of the SEC referred to above. We also maintain a website at http://www.danger.com, at which you may access these materials free of charge as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. The information contained in, or that can be accessed through, our website is not part of this prospectus.

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DANGER, INC. AND SUBSIDIARIES

Index to Consolidated Financial Statements

	Page
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets	F-3
Consolidated Statements of Operations	F-4
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Deficit	F-5
Consolidated Statements of Cash Flows	F-6
Notes to Consolidated Financial Statements	F-8

F-1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of

Danger, Inc.:

We have audited the accompanying consolidated balance sheets of Danger, Inc. and subsidiaries (the “Company”) as of September 30, 2007 and 2006, and the related consolidated statements of operations, redeemable convertible preferred stock and stockholders’ deficit and cash flows for each of the three years in the period ended September 30, 2007. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Danger, Inc. and subsidiaries as of September 30, 2007 and 2006, and the results of their operations and their cash flows for each of the three years in the period ended September 30, 2007, in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 1 to the consolidated financial statements, the Company adopted Financial Accounting Standards Board Statement No. 123 (revised 2004), Share-Based Payment, effective October 1, 2006.

/s/    Deloitte & Touche LLP

San Jose, California

December 19, 2007

F-2

DANGER, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

							Pro Forma September 30, 2007
	September 30,
	2006			2007
							(Unaudited)
							(See Note 1)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	17,179		$	12,979
Accounts receivable, net		7,381			11,886
Restricted cash		221			50
Prepaid expenses		1,271			1,929
Other current assets		465			50
Total current assets		26,517			26,894
PROPERTY AND EQUIPMENT, NET		12,574			17,358
DEFERRED COSTS		7,847			4,266
RESTRICTED CASH		203			178
OTHER ASSETS		485			328
TOTAL	$	47,626		$	49,024
LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)
LIABILITIES:
Accounts payable	$	2,450		$	2,910
Accrued expenses and other current liabilities		7,173			7,072
Current portion of deferred revenues		9,140			6,097
Current maturities of capital lease obligations		811			1,854
Total current liabilities		19,574			17,933
DEFERRED REVENUES		3,056			4,533
OTHER LONG-TERM LIABILITIES		1,011			520
PREFERRED WARRANT LIABILITY		11,124			12,180		$	—
CAPITAL LEASE OBLIGATIONS		195			2,647
Total liabilities		34,960			37,813
COMMITMENTS AND CONTINGENCIES (NOTE 10)
Redeemable convertible preferred stock, $0.0001 par value—140,064,723 and 148,902,132 shares issued and outstanding at September 30, 2006 and 2007, respectively; no shares outstanding pro forma. Liquidation preference of $255,199 at September 30, 2007		171,667			197,623			—
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, $0.0001 par value—175,440,562 shares authorized at September 30, 2006 and 2007
Common stock, $0.0001 par value—260,000,000 shares authorized at September 30, 2006 and 2007 and 16,816,213 and 17,930,106 shares issued and outstanding at September 30, 2006 and 2007, respectively and 186,063,970 shares outstanding pro forma		2			2			19
Additional paid-in capital		1,027			1,687			211,473
Accumulated deficit		(160,030	)		(188,101	)		(188,101	)
Total stockholders’ equity (deficit)		(159,001	)		(186,412	)	$	23,391
TOTAL	$	47,626		$	49,024

The accompanying notes are an integral part of the consolidated financial statements.

F-3

DANGER, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

	Years Ended September 30,
	2005			2006			2007
REVENUES:
Service	$	21,669		$	38,895		$	50,581
Product		15,121			10,416			5,832
Total revenues		36,790			49,311			56,413
COST OF REVENUES:
Cost of service revenues		10,701			17,755			26,846
Cost of product revenues		16,220			9,130			5,276
Total cost of revenues		26,921			26,885			32,122
GROSS PROFIT		9,869			22,426			24,291
OPERATING EXPENSES:
Research and development		11,317			17,746			22,497
Sales and marketing		5,211			5,723			7,020
General and administrative		3,610			6,999			6,541
Total operating expenses		20,138			30,468			36,058
LOSS FROM OPERATIONS		(10,269	)		(8,042	)		(11,767	)
OTHER INCOME (EXPENSE), NET:
Interest expense		(252	)		(205	)		(557	)
Change in fair value of preferred warrant liability		—			(907	)		(1,017	)
Interest and other income, net		611			1,219			1,054
Total other income (expense), net		359			107			(520	)
Loss before provision for income taxes and cumulative effect of change in accounting principle		(9,910	)		(7,935	)		(12,287	)
Provision for income taxes		—			(54	)		(74	)
Loss before cumulative effect of change in accounting principle		(9,910	)		(7,989	)		(12,361	)
Cumulative effect of change in accounting principle		—			1,421			—
Net loss		(9,910	)		(6,568	)		(12,361	)
Accretion of redemption value on redeemable convertible preferred stock		(12,309	)		(14,477	)		(15,710	)
Net loss attributable to common stockholders	$	(22,219	)	$	(21,045	)	$	(28,071	)
Net loss per share attributable to common stockholders—basic and diluted:
Loss before cumulative effect of change in accounting principle	$	(0.69	)	$	(0.53	)	$	(0.76	)
Cumulative effect of change in accounting principle		—			0.09			—
Accretion of redemption value on redeemable convertible preferred stock		(0.85	)		(0.95	)		(0.96	)
NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS—BASIC AND DILUTED	$	(1.54	)	$	(1.39	)	$	(1.72	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING—BASIC AND DILUTED		14,396			15,142			16,353
PRO FORMA NET LOSS PER SHARE—BASIC AND DILUTED (UNAUDITED)							$	(0.06	)
PRO FORMA WEIGHTED AVERAGE COMMON SHARES OUTSTANDING—BASIC AND DILUTED (UNAUDITED)								184,463

The accompanying notes are an integral part of the consolidated financial statements.

F-4

DANGER, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT

(In thousands, except share and per share data)

	Redeemable Convertible Preferred Stock				Common Stock				Additional Paid-in Capital			Notes Receivable From Stockholders			Accumulated Deficit			Total Stockholders’ Deficit
	Shares	Amount			Shares		Amount
Balance at October 1, 2004	117,859,773	$	134,980		14,092,851		$	1	$	490		$	(73	)	$	(116,766	)	$	(116,348	)
Exercise of common stock options for cash	—		—		685,190			—		150			—			—			150
Exercise of common stock options for services	—		—		60,000			—		6			—			—			6
Collection of notes receivable from stockholders	—		—		—			—		—			64			—			64
Issuance of common stock in exchange for consulting services	—		—		25,000			—		6			—			—			6
Issuance of common stock options in exchange for consulting services	—		—		—			—		21			—			—			21
Repurchase of unvested common stock	—		—		(12,209	)		—		(3	)		—			—			(3	)
Accretion of redemption value on redeemable convertible preferred stock	—		12,309		—			—		—			—			(12,309	)		(12,309	)
Net loss	—		—		—			—		—			—			(9,910	)		(9,910	)
Balance at September 30, 2005	117,859,773		147,289		14,850,832			1		670			(9	)		(138,985	)		(138,323	)
Exercise of common stock options for cash	—		—		1,968,377			1		354			—			—			355
Collection of notes receivable from stockholders	—		—		—			—		—			9			—			9
Issuance of common stock options in exchange for consulting services	—		—		—			—		4			—			—			4
Repurchase of unvested common stock	—		—		(2,996	)		—		(1	)		—			—			(1	)
Issuance of Series D' redeemable convertible preferred stock and warrants to purchase Series D' redeemable convertible preferred stock at $0.9007 per share, net of issuance costs of $50	22,204,950		17,794		—			—		—			—			—			—
Reclassification of warrants to liabilities upon the adoption of FSP 150-5	—		(7,893	)	—			—		—			—			—			—
Accretion of redemption value on redeemable convertible preferred stock	—		14,477		—			—		—			—			(14,477	)		(14,477	)
Net loss	—		—		—			—		—			—			(6,568	)		(6,568	)
Balance at September 30, 2006	140,064,723		171,667		16,816,213			2		1,027			—			(160,030	)		(159,001	)
Exercise of common stock options for cash	—		—		1,172,748			—		321			—			—			321
Employee stock compensation expense	—		—		—			—		329			—			—			329
Issuance of common stock options in exchange for consulting services	—		—		—			—		25			—			—			25
Issuance of Series E redeemable convertible preferred stock at $1.1655 per share, net of issuance costs of $54	8,837,409		10,246		—			—		—			—			—			—
Repurchase of common stock	—		—		(58,855	)		—		(15	)		—			—			(15	)
Accretion of redemption value on redeemable convertible preferred stock	—		15,710		—			—		—			—			(15,710	)		(15,710	)
Net loss	—		—		—			—		—			—			(12,361	)		(12,361	)
Balance at September 30, 2007	148,902,132	$	197,623		17,930,106		$	2	$	1,687		$	—		$	(188,101	)	$	(186,412	)

The accompanying notes are an integral part of the consolidated financial statements.

F-5

DANGER, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Years Ended September 30,
	2005			2006			2007
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(9,910	)	$	(6,568	)	$	(12,361	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		2,546			3,604			5,713
Loss (gain) on disposal of property and equipment		8			(5	)		100
Gain on termination of capital lease		—			(62	)		—
Amortization of fair value of warrants issued in connection with capital lease financing		15			8			15
Stock-based compensation expense		33			4			354
Cumulative effect of change in accounting principle		—			(1,421	)		—
Change in fair value of preferred warrant liability		—			907			1,017
Non-cash charges in relation to performance warrants		729			860			—
Changes in assets and liabilities:
Accounts receivable		(3,163	)		(531	)		(4,505	)
Inventories		(15	)		116			—
Prepaid expenses and other current assets		216			(430	)		(135	)
Deferred costs		11,114			8,570			3,581
Other assets		43			126			229
Accounts payable		391			(626	)		1,119
Accrued expenses and other current liabilities		(4,065	)		2,021			(203	)
Deferred revenues		(15,468	)		(14,006	)		(1,566	)
Other liabilities		(357	)		(185	)		247
Net cash used in operating activities		(17,883	)		(7,618	)		(6,395	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(6,106	)		(6,427	)		(6,481	)
Proceeds from disposal of property and equipment		—			—			18
Purchases of short-term investments		(3,701	)		—			—
Proceeds from sale of short-term investments		5,300			902			—
(Increase) decrease in restricted cash		(3,600	)		3,526			196
Net cash used in investing activities		(8,107	)		(1,999	)		(6,267	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of redeemable convertible preferred stock, net of issuance costs		—			19,950			10,246
Proceeds from exercise of common stock options		171			485			327
Repurchase of common stock		(3	)		(1	)		(15	)
Proceeds from capital lease obligations		3,478			—			907
Repayment of capital lease obligations		(1,259	)		(3,819	)		(2,341	)
Repayment of other long-term obligations		(34	)		(548	)		(665	)
Collection of notes receivable from stockholders		64			9			—
Net cash provided by financing activities		2,417			16,076			8,459
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS		—			—			3
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(23,573	)		6,459			(4,200	)
CASH AND CASH EQUIVALENTS—BEGINNING OF YEAR		34,293			10,720			17,179
CASH AND CASH EQUIVALENTS—END OF YEAR	$	10,720		$	17,179		$	12,979

(Continued)

F-6

DANGER, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Years Ended September 30,
	2005		2006		2007
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for interest	$	237	$	194	$	500
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Assets purchased under installment payables	$	287	$	1,845	$	—
Assets acquired under capital leases	$	—	$	1,026	$	4,954
Property and equipment purchases included in accounts payable at year-end	$	47	$	1,583	$	918
Proceeds from disposal of property and equipment included in other current assets at year-end	$	—	$	18	$	—
Issuance of warrants to purchase redeemable convertible preferred stock in connection with capital lease financing	$	—	$	—	$	39
Accretion of redemption value of redeemable convertible preferred stock	$	12,309	$	14,477	$	15,710

(Concluded)

The accompanying notes are an integral part of the consolidated financial statements.

F-7

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Nature of Operations—Danger, Inc. (“Danger”, or the “Company”) was incorporated in Delaware in December 1999. Danger is a software-as-a-service (“SaaS”) company that provides mobile operators with an integrated end-to-end solution to deliver mobile data and Internet services to their subscribers. The Danger solution integrates the Company’s hosted service delivery engine and the Company’s client software with mobile devices (“Danger-enabled mobile devices”) manufactured by the Company’s original equipment manufacturer (“OEM”) partners. The Danger solution offers real-time email, instant messaging and social networking services, and HTML web browsing, as well as premium applications, content and services developed internally and through our third-party developer program. The Danger solution is deployed in the United States and certain international markets, including Australia and Europe.

The Company has incurred recurring losses from operations since inception and has an accumulated deficit of $188,101,000 as of September 30, 2007. For the year ended September 30, 2007, the Company incurred a loss from operations of $11,767,000 and had negative cash flows from operating activities of approximately $6,395,000. The Company may incur additional operating losses and negative cash flows in the future. Failure to generate sufficient revenues, reduce spending or raise additional capital could adversely affect the Company’s ability to achieve its intended business objectives. In October 2007, the Company’s board of directors (the “Board”) authorized management to file a registration statement with the Securities and Exchange Commission (“SEC”) permitting the Company to sell shares of its common stock to the public.

Basis of Presentation—The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.

Unaudited Pro Forma Balance Sheet Data—If the initial public offering is completed under the terms presently anticipated, all of the Company’s redeemable convertible preferred stock outstanding as of September 30, 2007, will automatically convert into 168,133,864 shares of common stock and all outstanding warrants to purchase redeemable convertible preferred stock will either become warrants to purchase common stock, terminate, or be exercised on a cashless basis resulting in the net issuance of common stock upon the closing of the offering. Certain unaudited pro forma balance sheet data, as adjusted for the assumed conversion of the redeemable convertible preferred stock and the reclassification of the preferred warrant liability to additional paid-in-capital is set forth on the accompanying consolidated balance sheet as of September 30, 2007. Shares of the Company’s common stock issuable upon the exercise of outstanding warrants, including as a result of the automatic exercise on a cashless basis of certain of these warrants immediately prior to the closing of this offering, are not reflected in the accompanying pro forma balance sheet data.

Use of Estimates—The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts and disclosures reported in its consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and other assumptions it believes to be reasonable under the circumstances, the results of which are the basis of making judgments about the carrying value of assets and liabilities. Actual results may differ from those estimates.

Certain Significant Risks and Uncertainties—The Company participates in a dynamic high-technology industry. A variety of risks and uncertainties, including but not limited to, changes in any of the following areas, could have a material adverse effect on the Company’s future financial position, results of operations or cash flows: changes in certain strategic relationships or customer relationships; market acceptance of the Company’s offerings; timely introduction of new products and services by the Company and its OEM partners; advances and trends in new technologies and industry standards; development of sales channels; litigation or claims against the Company based on intellectual property, product, regulatory or other factors and the Company’s ability to attract and retain employees necessary to support its growth.

F-8

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Revenue Recognition and Cost of Revenue—As a result of its execution of a Master Service Agreement with T-Mobile USA, Inc. (“T-Mobile USA”), the Company completed the transformation of its business model to a pure SaaS provider. The Company’s new arrangement with T-Mobile USA was signed in March 2006 and effective as of June 2005. Under the SaaS business model, the Company enters into service contracts with mobile operators and generates revenues primarily from the following sources:

• monthly service fees for each of the mobile operator customers’ subscribers that can access the Company’s mobile data services;

• premium applications, content and services fees charged as a one-time fee or a monthly subscription fee, derived from downloads of games, productivity applications, networked services, ringtones and background themes; and

• non-recurring engineering (“NRE”) fees related to the initial deployment of the Company’s mobile data services and to custom development projects for the Company’s mobile operator customers.

The Company recognizes revenues in accordance with accounting standards for software and service companies, including American Institute of Certified Public Accountants (“AICPA”) Statement of Position (“SOP”) No. 97-2, Software Revenue Recognition (“SOP 97-2”), as amended by SOP 98-9, the consensus reached in Emerging Issues Task Force (“EITF”) Issue No. 03-5, Applicability of AICPA Statement of Position 97-2 to Non-Software Deliverables in an Arrangement Containing More-Than-Incidental Software (“EITF 03-5”), and related interpretations, including AICPA Technical Practice Aids (“TPAs”).

Danger’s client software, which is provided to the Company’s OEM partners on a royalty-free basis, is embedded in Danger-enabled mobile devices. The Company’s OEM partners sell the Danger-enabled mobile devices directly to the Company’s mobile operator customers. Therefore, the Company accounts for the client software as an element in its arrangements with its mobile operator customers. Since the client software is more than incidental to the arrangement, the Company recognizes revenue in accordance with SOP 97-2.

The Company evaluates whether its mobile data services are essential to the functionality of any other elements under the arrangements, including the client software embedded in Danger-enabled mobile devices. The Company provides a fully integrated solution, in which a mobile operator’s subscribers must purchase Danger-enabled mobile devices in order to obtain access to the Company’s mobile data services. Accessing the Company’s mobile data services is essential to allow the mobile operator’s subscribers to have full use of Danger-enabled mobile devices as they would not have full functionality without the Company’s mobile data services. However, contract accounting is not required because the client software is fully functional upon delivery, as it allows the mobile operator’s subscribers to gain access to the Company’s mobile data services upon delivery without significant modifications or additions to the client software.

Premium applications, content and services fees are earned based upon applying a constant multiplier, which varies based on the type of premium applications, content and services, to the number of successful downloads. Mobile operators’ subscribers may also subscribe to network-aware premium applications, content and services on a subscription basis, for which the Company charges monthly subscription fees. Premium applications, content and services fees are billed to the mobile operators on a monthly basis. As premium applications, content and services are offered to the mobile operators as an option to purchase unlimited future software products at a predetermined price and the Company does not have vendor-specific objective evidence, or VSOE, of fair value nor does the Company offer a comparable discount for premium applications, content and services, in accordance with TPA 5100.50, Definition of More-Than-Insignificant Discount and Software

F-9

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Revenue Recognition, and TPA 5100.51, Accounting for Significant Incremental Discounts on Future Purchases, a significant incremental discount on premium applications, content and services is deemed existent in the Company’s arrangements with its mobile operator customers. Since future purchases of premium applications, content and services are not limited by quantity, this significant incremental discount effectively creates a subscription model for other elements in the arrangements. Therefore, premium applications, content and services revenues are deferred and amortized ratably over the longer of the applicable mobile operator’s remaining contract term or the expected period of performance under the applicable mobile operator’s contract, commencing the month after the premium applications, content and services are provided. Any direct incremental premium applications, content and services costs are also deferred and amortized over the same period, although not in amounts exceeding the premium applications, content and services revenues that are deferred. Premium applications, content and services revenues and costs are recorded as service revenues and cost of service revenues, respectively, on the Company’s consolidated statements of operations.

Revenues associated with NRE fees related to the initial deployment of the mobile data services and to custom development projects are also accounted for under the subscription model as a result of the presence of the significant incremental discount on premium applications, content and services. Therefore, revenues associated with NRE fees are deferred and amortized ratably over the longer of the applicable mobile operator’s remaining contract term or the expected period of performance under the mobile operator’s contract, commencing the month after the mobile data services are first launched or when the applicable mobile operator accepts the custom development project. Any associated direct incremental costs are also deferred, although not in amounts exceeding the deferred revenues associated with NRE fees and amortized over the same period. Revenues and costs associated with NRE fees are recorded as service revenues and cost of service revenues, respectively, on the Company’s consolidated statement of operations.

Monthly service fees under the Company’s revenue arrangements with mobile operators are earned based on the number of days that the operator customers’ subscribers are able use the mobile data services and are billed to the mobile operator customers on a monthly basis. Post-contract customer support services are provided to the mobile operators at no additional charge throughout the contract term. The Company recognizes revenue based on the guidance in TPA 5100.76, Fair Value in Multiple-Element Arrangements That Include Contingent Usage-Based Fees and Software Revenue Recognition. The monthly service fees are analogous to the contingent usage-based fees under TPA 5100.76. The TPA 5100.76 accounting model is considered a subscription model for usage based revenues. Therefore, the Company recognizes revenues on the monthly service fees as the fee becomes fixed or determinable at the time actual usage occurs and collectibility is probable. This occurs at the end of each month when the Company has a reliable measure of usage. At that time, the Company has also satisfied the other revenue recognition criteria contained in SOP 97-2 as the Company has persuasive evidence that an arrangement exists, services have been rendered, the price is fixed or determinable, and collectibility is reasonably assured. Monthly service revenues and costs are recorded as service revenues and cost of service revenues, respectively, on the Company’s consolidated statement of operations.

When a specified deliverable is deemed present in an arrangement with a mobile operator and the Company does not have VSOE of fair value of this specified deliverable, the Company defers the recognition of all revenues under the particular arrangement until the commitment to provide the specified deliverable is fulfilled. The Company deferred all of its revenue from the arrangement with T-Mobile USA during the years ended September 30, 2003 and 2004 and recognized the cumulative deferred revenues during the year ended September 30, 2005 upon the fulfillment of its commitment to provide certain specified deliverables under the arrangement with T-Mobile USA.

F-10

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

In addition to the aforementioned revenue sources, the Company sold Danger-enabled mobile devices to certain of its mobile operator customers until March 2006. The Company also charged client license fees upon device shipment or activation to its mobile operator customers prior to June 2005, and the Company still charges client license fees to certain of its mobile operator customers that account for a relatively small number of subscribers that access our mobile data services. Revenues associated with the sale of Danger-enabled mobile devices and client license fees are deferred and amortized ratably over the longer of the remaining contract term, the expected period of performance under the mobile operator customer’s contract or, in cases where the mobile operators had refund rights, over the duration of any refund period. Any direct incremental costs, although not in amounts exceeding associated deferred revenues, are deferred and amortized over the same period. Product sales and costs are recorded as product revenues and cost of product revenues, respectively, on the Company’s consolidated statement of operations. Client license fee revenues and costs are recorded as service revenues and costs of service revenues, respectively, on the Company’s consolidated statements of operations.

Deferred Revenues and Deferred Costs—Deferred revenues consist of billings or payments the Company receives in advance of revenue recognition and are recognized as the revenue recognition criteria are met. The Company invoices its mobile operator customers as services are delivered monthly or up-front for certain items. The current portion of deferred revenues represents the portion of deferred revenues that will be recognized during the succeeding 12-month period and is adjusted for known accelerators, which include the effect of operator customers’ contract cancellations, and the effect of specified deliverables. The Company defers direct incremental costs related to the deferred revenues, which are amortized over the same period as the related revenues. In accordance with Staff Accounting Bulletin (“SAB”) Topic 13.A.3 (f), the Company has classified its deferred costs as a non-current asset as the underlying contracts have terms in excess of 12 months.

Warranty—The Company currently licenses its reference design for Danger-enabled mobile devices to its OEM partners under which the OEM partners manufacture and sell the Danger-enabled mobile devices directly to the mobile operators. The OEM partners are responsible for all aspects of the device hardware. Therefore, the Company does not provide a hardware product warranty for Danger-enabled mobile devices produced and sold by its OEM partners. However, under its OEM agreements, the Company is responsible for the cost of hardware repairs, including software reflashing, that result from defects in the client software. If necessary, the Company estimates and accrues for the software warranty repair costs associated with specific OEM devices at the time the products are shipped to its mobile operator customers. To date, the Company has not had to pay any software related warranty claims.

Prior to September 2004, the Company operated as an OEM and Danger-enabled mobile devices were designed and manufactured by the Company under various contract manufacturing agreements. For such devices, the Company provided a one or two-year hardware product warranty. The Company accrued estimated warranty-related costs, including materials, labor, shipping, and handling, as cost of product revenues at the time these products were shipped. For most mobile operator customers, the hardware product warranty period for such devices expired in the year ended September 30, 2006.

Internal-Use Software Development Costs—The Company accounts for product development costs and costs related to the Company’s internally developed software systems in accordance with SOP No. 98-1 Accounting for the Costs of Computer Software Developed or Obtained for Internal Use. Costs incurred for maintenance and ongoing, minor upgrades and enhancements to the Company’s mobile data services are charged to cost of service revenue as incurred. The Company capitalizes costs related to specific upgrades and enhancements to its mobile data services and internal use development until the software is substantially complete and ready for its intended use. During the years ended September 30, 2006 and 2007, the Company

F-11

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

capitalized costs in the amount of $352,000 and $1,171,000, respectively. No costs were capitalized in the year ended September 30, 2005. Capitalized costs are recorded in property and equipment, net. To date, none of the internal-use software is ready for its intended use and therefore, there has been no amortization recorded. Software development costs are amortized over their estimated useful life to cost of service revenues or operating expenses, as appropriate.

Research and Development—Research and development costs are expensed as incurred, except that under Statement of Financial Accounting Standards (“SFAS”) No. 86, Accounting for the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed, software development costs incurred in the research and development of new software products are expensed as incurred only until technological feasibility of the product has been established. Software development costs incurred after technological feasibility has been established are capitalized up to the time the product is available for general release to customers. During the years ended September 30, 2005, 2006 and 2007, costs qualifying for capitalization have been insignificant as the Company’s current development process is essentially complete concurrent with the establishment of technological feasibility.

Stock-Based Compensation—Prior to October 1, 2006, as permitted by SFAS No. 123, Accounting for Stock-Based Compensation (“SFAS 123”), and SFAS No. 148, Accounting for Stock-Based Compensation—Transition and Disclosure, the Company accounted for stock-based employee compensation awards using the intrinsic value method in accordance with Accounting Principles Board (“APB”) Opinion No. 25, Accounting for Stock Issued to Employees, and its related interpretations (“APB 25”), which provides that no compensation expense is recognized for options granted with an exercise price equal to or greater than the market value of the underlying common stock on the date of grant.

Effective October 1, 2006, the Company adopted SFAS No. 123 (revised 2004), Share-Based Payment (“SFAS 123(R)”), using the prospective transition method. Under that transition method, stock-based compensation expense recognized in the year ended September 30, 2007 includes stock-based compensation expense for all share-based payments granted or modified on and subsequent to October 1, 2006, based on the fair value estimated in accordance with the provisions of SFAS 123(R). SFAS 123(R) requires companies to estimate the fair value of share-based payment awards using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods. SFAS 123(R) requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. In accordance with the prospective transition method, prior periods have not been restated to reflect, and do not include, the impact of SFAS 123(R), and share-based awards granted prior to October 1, 2006 continue to be accounted for in accordance with APB 25.

The Company accounts for equity instruments issued to non-employees in accordance with the provisions of SFAS 123 and EITF No. 96-18, Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling Goods or Services, which require that the fair value of such instruments be recognized as an expense over the period in which the related services are received.

Income Taxes—The Company uses the asset and liability method of accounting for income taxes in accordance with SFAS No. 109, Accounting for Income Taxes. Deferred income taxes reflect the impact of temporary differences between assets and liabilities recognized for financial reporting purposes and such amounts recognized for income tax reporting purposes, net operating loss carryforwards, and other tax credits measured by applying currently enacted tax laws. Valuation allowances are provided when necessary to reduce deferred tax assets to an amount that is more likely than not to be realized. As of September 30, 2006 and 2007, all deferred tax assets, without offsetting liabilities in the same jurisdiction, were fully reserved.

F-12

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Net Loss per Share—Basic and diluted net loss per share is presented in accordance with SFAS No. 128, Earnings per Share. Basic net loss per share is computed by dividing consolidated net loss by the weighted average number of shares of common stock outstanding during each period. Diluted net loss per share includes the impact of the Company’s outstanding potential shares of common stock, such as outstanding common stock options, redeemable convertible preferred stock and warrants to purchase redeemable convertible preferred stock. The Company’s potentially dilutive securities are not included in the computation of diluted net loss per share when the result would be anti-dilutive.

Comprehensive Loss—SFAS No. 130, Reporting Comprehensive Income, requires that the Company report, by major components and as a single total, the change in its net assets during the period from non-owner sources. Net loss is equal to comprehensive loss for all periods presented.

Cash and Cash Equivalents—The Company considers all highly liquid instruments purchased with an original maturity of three months or less at the time of purchase to be cash equivalents. Cash and cash equivalents are comprised of master notes, commercial paper, money market funds, and repurchase agreements.

Restricted Cash—As of September 30, 2006 and 2007, the Company has restricted cash totaling $424,000 and $228,000, respectively. The Company’s restricted cash is in the form of collateral to letters of credit issued to two of the Company’s landlords and to an equipment vendor, which serve as security deposits for certain lease agreements.

Concentration of Credit Risk—Financial instruments which subject the Company to potential credit risk consist primarily of its cash and cash equivalents and accounts receivable. The Company places its cash and cash equivalents with high credit quality financial institutions. Deposits held with financial institutions are likely to exceed the amount of insurance on these deposits; however, these deposits typically are redeemable upon demand and, therefore, the Company believes the financial risks associated with these financial instruments are minimal.

The Company sells its products and services to customers located in different geographic areas, however, the vast majority of the Company’s revenues are generated from customers located in the United States. The Company does not require collateral or other security to support accounts receivable. As of September 30, 2006 and 2007, receivables from T-Mobile USA, Inc. and affiliates, which are mobile operators in various geographies worldwide (collectively “T-Mobile”), represented 92% and 97% of total accounts receivable, respectively. For the years ended September 30, 2005, 2006 and 2007, revenues from T-Mobile represented 92%, 91% and 94% of total revenues, respectively. As of September 30, 2006 and 2007, there was no allowance for doubtful accounts.

Fair Value of Financial Instruments—The reported amounts of the Company’s financial instruments including cash and cash equivalents, accounts receivable, accounts payable and certain other accrued liabilities approximate fair value due to their short maturities. Based upon borrowing rates currently available to the Company for installment loans with similar terms, the carrying value of the obligations approximate their fair value. The carrying amount of the preferred warrant liability represents its fair value (see Note 2).

Property and Equipment—Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method. Equipment, software, furniture and fixtures are depreciated over the estimated useful lives of the assets, generally three to five years. Leasehold improvements are amortized over the shorter of the lease term or their estimated useful lives. Assets

F-13

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

acquired under capital leases are amortized over the lease term, or if the lease transfers ownership of the assets to the Company by the end of the lease term or the lease contains a bargain purchase option, the assets are amortized over their estimated useful lives. Significant improvements which substantially extend the useful lives of assets are capitalized. No amortization is provided for assets to be deployed until the assets are ready for their intended use. Repairs and maintenance costs are charged to expense as incurred. Upon disposal of an asset, its accumulated depreciation is deducted from the original cost and any gain or loss is reflected in cost of revenues or operating expenses, as appropriate.

Impairment or Disposal of Long-Lived Assets—In accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, the Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted net cash flows expected to be generated from the use of the asset. If such asset is considered to be impaired, the impairment loss to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the assets. No impairment charges have been recorded through September 30, 2007.

Preferred Warrant Liability—The Company accounts for its warrants related to shares that are redeemable in accordance with the Financial Accounting Standards Board (“FASB”) Staff Position 150-5, Issuer’s Accounting under FASB Statement No. 150 (“SFAS 150”) for Freestanding Warrants and Other Similar Instruments on Shares That Are Redeemable (“FSP 150-5”). Under FSP 150-5, the preferred stock warrants that are related to the Company’s redeemable convertible preferred stock are classified as liabilities on its consolidated balance sheets. The warrants are subject to re-measurement at each balance sheet date and any changes in the fair value are recognized in the statements of operations. The Company will continue to adjust the liability for changes in fair value until the earlier of their exercise or termination, or a liquidation event, including the consummation of an initial public offering, at which time the preferred warrant liability will be reclassified to stockholders’ deficit.

Foreign Currency Transactions—The functional currency of the Company’s foreign subsidiary is the U.S. dollar. Accordingly, all monetary assets and liabilities are translated at the current exchange rate at the end of the period, nonmonetary assets and liabilities are translated at historical rates, and revenues and expenses are translated at the average exchange rate in effect during the period. Foreign currency transaction gains and losses are included as a component of other income (expense), net in the Company’s consolidated statements of operations (see Note 12).

Recent Accounting Pronouncements—In July 2006, FASB issued FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes – an Interpretation of FASB Statement No. 109 (“FIN 48”). FIN 48 prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. FIN 48 was effective for the Company on October 1, 2007. The Company is currently evaluating the impact that the adoption of FIN 48 will have, if any, on its consolidated financial position, results of operations or cash flows.

In September 2006, FASB issued SFAS No. 157, Fair Value Measurements (“SFAS 157”), which provides guidance on how to measure assets and liabilities that use fair value. SFAS 157 will apply whenever another

F-14

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

GAAP standard requires (or permits) assets or liabilities to be measured at fair value but does not expand the use of fair value to any new circumstances. This standard also will require additional disclosures in the financial statements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. The Company is currently evaluating the impact that the adoption of SFAS 157 will have, if any, on its consolidated financial position, results of operations or cash flows.

In September 2006, FASB ratified EITF Issue No. 06-1, Accounting for Consideration Given by a Service Provider to a Manufacturer or Reseller of Equipment Necessary for an End-Customer to Receive Service from the Service Provider (“EITF 06-1”). Under EITF 06-1, consideration received by a service provider’s end-customer from a manufacturer or reseller constitutes consideration given by the service provider to the end-customer if the manufacturer or reseller is required by contract with the service provider to provide consideration to the end-customer. If such a contractual arrangement exists, classification of the consideration in the service provider’s income statement depends on the form of the consideration received by the end-customer. Cash consideration would be reported as a reduction of revenue; non-cash consideration, as defined in EITF 01-9, Accounting for Consideration Given by a Vendor to a Customer (Including a Reseller of the Vendor’s Products), including free or discounted product, would be reported as an expense. EITF 06-1 is effective for the first annual reporting period beginning after June 15, 2007. The Company does not expect that the adoption of EITF 06-1 will have a material effect on its consolidated financial position, results of operations or cash flows.

In February 2007, FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of FASB Statement No. 115 (“SFAS 159”). SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS 159 does not affect any existing accounting literature that requires certain assets and liabilities to be carried at fair value. SFAS 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. The Company does not expect that the adoption of SFAS 159 will have a material effect on its consolidated financial position, results of operations or cash flows.

In September 2006, the Staff of the SEC issued Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements (“SAB 108”). SAB 108 provides guidance on the consideration of the effects of prior year misstatements in quantifying current year misstatements for the purpose of determining whether the current year’s financial statements are materially misstated. Registrants must begin to apply the provisions of SAB 108 no later than the annual financial statements for their first fiscal year ending after November 15, 2006. The Company does not expect that the adoption of SAB 108 will have a material effect on its consolidated financial position, results of operations or cash flows.

2. CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE

The Company adopted FSP 150-5 and accounted for the cumulative effect of the change in accounting principle as of October 1, 2005. As a result, the Company reclassified warrants with a book value of $7,893,000 from redeemable convertible preferred stock to preferred warrant liability in the Company’s consolidated balance sheet and recorded a gain of $1,421,000, or $0.09 per share for the cumulative effect of change in accounting principle. The Company also recorded expense of $907,000 and $1,017,000 in its consolidated statements of operations to reflect the change in fair value of warrants for the years ended September 30, 2006 and 2007, respectively. There is no tax effect associated with the gain recorded as of October 1, 2005 or the subsequent fair value adjustments. See Notes 4 and 5 for a description of the assumptions related to the determination of fair value of these warrants.

F-15

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

3. NET LOSS PER SHARE

Historical—Basic net loss per share is computed by dividing consolidated net loss by the weighted average number of vested common shares outstanding during each period. The Company’s potentially dilutive shares, which include outstanding common stock options, redeemable convertible preferred stock and warrants to purchase redeemable convertible preferred stock, have not been included in the computation of diluted net loss per share for all periods as the result would be anti-dilutive.

The following details the calculation of net loss per share for the periods presented (in thousands, except per share data):

	Years Ended September 30,
	2005			2006			2007
Net loss attributable to common stockholders	$	(22,219	)	$	(21,045	)	$	(28,071	)
Basic and diluted shares:
Weighted average common shares outstanding		14,456			15,516			17,281
Weighted average unvested common shares subject to repurchase		(60	)		(374	)		(928	)
Weighted average shares used to compute basic and diluted net loss per share		14,396			15,142			16,353
Net loss per share attributable to common stockholders—basic and diluted	$	(1.54	)	$	(1.39	)	$	(1.72	)

The following table sets forth potential shares of common stock that are not included in the calculation of diluted net loss per share because to do so would be anti-dilutive as of the end of each period presented:

	September 30,
	2005	2006	2007
Redeemable convertible preferred stock	130,457,237	159,296,455	168,133,864
Stock options outstanding	22,593,629	29,929,526	42,861,396
Warrants to purchase redeemable convertible preferred stock	14,482,024	25,807,905	25,936,605
Unvested common stock subject to repurchase	87,382	1,053,816	863,515

Unaudited Pro Forma Net Loss per Share—In October 2007, the Board authorized management to file a registration statement with the SEC in order for the Company to sell shares of its common stock to the public. If the initial public offering is completed under the terms presently anticipated, all of the Series A, Series B-1, Series C, Series D, Series D' and Series E redeemable convertible preferred stock outstanding at the time of the offering will automatically convert into 168,133,864 shares of common stock.

F-16

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

3. NET LOSS PER SHARE (Continued)

The unaudited pro forma basic and diluted net loss per common share calculations for the year ended September 30, 2007 assume the conversion of all outstanding shares of redeemable convertible preferred stock into shares of common stock using the if-converted method, as though the conversion had occurred on October 1, 2006 or on the original dates of issuance for redeemable convertible preferred stock issued after October 1, 2006 (in thousands, except per share data).

	Year Ended September 30,
	2007
Net loss attributable to common stockholders	$	(28,071	)
Add:
Accretion of redemption value on redeemable convertible preferred stock		15,710
Change in fair value of preferred warrant liability		1,017
Pro forma net loss	$	(11,344	)
Weighted average common shares used to compute historical basic and diluted net loss per share		16,353
Pro forma adjustment to reflect assumed weighted average conversion of redeemable convertible preferred stock to common stock		168,110
Weighted average common shares used to compute pro forma basic and diluted net loss per share		184,463
Pro forma basic and diluted net loss per share	$	(0.06	)

4. FINANCIAL STATEMENT DETAILS

Property and Equipment—Property and equipment consist of the following (in thousands):

	September 30,
	2006			2007
Computer and data center equipment	$	9,655		$	17,009
Software		4,338			6,522
Machinery and equipment		573			801
Leasehold improvements		1,208			2,322
Furniture and fixtures		286			613
Assets to be deployed		3,359			2,556
Property and equipment, cost		19,419			29,823
Accumulated depreciation and amortization		(6,845	)		(12,465	)
Property and equipment, net	$	12,574		$	17,358

The amount reflected in equipment cost at September 30, 2006 and 2007 includes $1,802,000 and $6,123,000, respectively, of assets under capital leases. At September 30, 2006 and 2007, the net book value of assets under capital leases was $800,000 and $4,686,000, respectively.

F-17

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. FINANCIAL STATEMENT DETAILS (Continued)

Accrued Expenses and Other Current Liabilities—Accrued expenses and other current liabilities consist of the following (in thousands):

	September 30,
	2006		2007
Accrued compensation	$	1,381	$	1,689
Accrued royalties and claims		2,248		2,320
Accrued professional fees		1,852		1,245
Installment payable—current portion		665		774
Accrued facility costs		413		447
Accrued warranty		103		24
Other		511		573
Total accrued expenses and other current liabilities	$	7,173	$	7,072

Warranty Costs—The following table presents changes in the warranty accrual, which is included in accrued expenses and other current liabilities in the Company’s consolidated balance sheets (in thousands):

	Years Ended September 30,
	2005			2006			2007
Balance at beginning of year	$	6,140		$	534		$	103
Change in pre-existing warranty balance		(58	)		(477	)		(25	)
Warranties issued during current period		414			65			1
Settlements		(5,962	)		(19	)		(55	)
Balance at end of year	$	534		$	103		$	24

Deferred Revenues—Deferred revenues consist of the following (in thousands):

	September 30,
	2006			2007
Deferred service revenues	$	6,272		$	10,414
Deferred product revenues		5,924			216
Total deferred revenues		12,196			10,630
Less current portion		(9,140	)		(6,097	)
Long-term portion	$	3,056		$	4,533

F-18

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. FINANCIAL STATEMENT DETAILS (Continued)

Preferred Warrant Liability—Warrants outstanding to purchase the Company’s redeemable convertible preferred stock consist of the following (in thousands, except share and per share data):

	Contractual term (Years)	Series	Exercise price per share		Shares as of		Fair Value as of
Issue date					September 30, 2006	September 30, 2007	September 30, 2006		September 30, 2007
Jan-02	7	Preferred B-1	$	1.3741	68,512	68,512	$	4	$	6
May-02	7	Preferred C		0.0100	544,798	544,798		294		457
Feb-03	7	Preferred D		0.9007	5,870,424	5,870,424		2,737		2,719
Dec-03	7	Preferred D		0.9007	33,307	33,307		18		18
Sep-04	7	Preferred D		0.9007	6,588	6,588		4		4
Feb-04	7	Preferred D'		0.9007	3,371,179	3,371,179		2,125		2,306
Jul-04	7	Preferred D'		0.9007	2,754,750	2,754,750		1,802		1,969
Nov-05	3	Preferred D'		0.9007	1,539,914	1,539,914		661		774
Nov-05	7	Preferred D'		0.9007	3,330,742	3,330,742		2,509		2,757
Sep-06	3	Preferred D'		0.9007	1,924,892	1,924,892		970		1,111
Oct-06	7	Preferred E		1.1655	—	128,700		—		59
					19,445,106	19,573,806	$	11,124	$	12,180

All warrants to purchase redeemable convertible preferred stock will either (i) terminate if not exercised prior to the closing of this offering; (ii) be automatically exercised on a cashless basis immediately prior to the closing of this offering, resulting in the net issuance of that number of shares of the Company’s common stock as is determined based upon the fair market value of the common stock immediately prior to the closing of this offering; or (iii) convert into warrants to purchase shares of common stock at the applicable conversion rate for the related redeemable convertible preferred stock immediately prior to the closing of this offering.

The fair value of the above warrants was determined using the Black-Scholes-Merton (“Black-Scholes”) option-pricing model using the following assumptions:

	September 30,
	2006	2007
Risk-free interest rate	4.6% – 4.7%	4.0% – 4.3%
Estimated volatility	51.7% – 69.7%	47.6% – 63.3%
Expected dividend yield	0.0%	0.0%
Remaining contractual term (years)	2.1 – 6.1	1.1 – 6.0

F-19

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. REDEEMABLE CONVERTIBLE PREFERRED STOCK

As of September 30, 2007, the amounts, terms and liquidation values of redeemable convertible preferred stock are summarized as follows (in thousands, except share and per share data):

Series	Original Issue Price per Share		Designated	Outstanding	Carrying Value		Dividends per Share(1)
Preferred A	$	1.0800	9,907,407	9,907,407	$	16,636	$	0.0860
Preferred B-1		1.4596	12,318,444	12,249,932		26,398		0.1168
Preferred C		1.2371	16,271,453	15,726,655		22,118		0.0990
Preferred D		0.9007	45,073,258	39,136,220		47,625		0.0721
Preferred D'		0.9007	79,000,000	63,044,509		68,167		0.0721
Preferred E		1.1655	12,870,000	8,837,409		11,092		0.0932
Paid-in capital ascribed to preferred stock warrants			—	—		5,587
			175,440,562	148,902,132	$	197,623

Series	Liquidation Value per Share(2)		Liquidation Preference(2)		Conversion Ratio to Common Stock	Redemption Price per Share(3)
						Original		Additional per Annum
Preferred A	$	1.0800	$	10,700	1.0000	$	1.0800	$	0.0860
Preferred B-1		1.4596		17,980	1.0323		1.4596		0.1168
Preferred C		1.2371		20,129	1.0000		1.2371		0.0990
Preferred D		1.6395		73,854	1.0000		0.9007		0.0721
Preferred D'		1.5674		122,086	1.2988		0.9007		0.0721
Preferred E		1.1655		10,450	1.0000		1.1655		0.0932
			$	255,199

(1) Dividends for the holders of Series A, Series B-1, Series C and Series E redeemable convertible preferred stock are non-cumulative and dividends for the holders of Series D and Series D' redeemable convertible preferred stock are cumulative. These dividends are only payable when and if declared by the Board. No dividends have been declared on any class of stock as of September 30, 2007. These dividends do not include Liquidation Dividends (as defined under —Dividend Rights below) that are payable to the holders of Series D and Series D' redeemable convertible preferred stock on a liquidation event.

(2) The liquidation value disclosed herein represents the liquidation value assuming the Company is liquidated at a value equal to or less than $250,000,000 and that all preferred stock warrants are exercised for cash as of September 30, 2007. The liquidation value also includes Liquidation Dividends payable to holders of Series D and Series D' redeemable convertible preferred stock that is payable on a liquidation event. The ultimate liquidation value of the redeemable convertible preferred stock will be determined based on the Company’s value upon liquidation.

(3) No preferred stockholders have voted to invoke their redemption rights by a vote of a majority of preferred stockholders. If the preferred stockholders were to vote to effect a redemption, the earliest the preferred stock could be redeemed is January 2008.

F-20

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. REDEEMABLE CONVERTIBLE PREFERRED STOCK (Continued)

The issuances of the Company’s redeemable convertible preferred stock were as follows:

In September 2000, the Company issued 8,081,282 shares of Series A redeemable convertible preferred stock at $1.08 per share for cash proceeds of $7,238,000 (net of issuance costs of $62,000) and the conversion of $1,428,000 of promissory notes.

In December 2000, the Company issued 1,826,125 shares of Series A redeemable convertible preferred stock at $1.08 per share for cash proceeds of $1,971,000 (net of issuance costs of $1,000).

In July and September 2001, the Company issued an aggregate of 12,249,932 shares of Series B-1 redeemable convertible preferred stock at $1.4596 per share for cash proceeds of $17,782,000 (net of issuance costs of $98,000). In connection with the issuance of its Series B-1 redeemable convertible preferred stock, the Company issued the Series B-1 stockholders options to purchase a total of 7,347,927 shares of Series B-2 redeemable convertible preferred stock at a price of $2.52 per share (the “Series B-2 Options”). These options were exercisable at any time until July 20, 2002. The Company allocated $1,414,000 of the net proceeds from the issuance of the Series B-1 redeemable convertible preferred stock as the estimated value of the Series B-2 Options. None of the Series B-2 Options were exercised during their contractual life and all Series B-2 options expired on July 20, 2002.

In May and September 2002, the Company issued an aggregate of 10,497,712 shares of Series C redeemable convertible preferred stock at $1.2371 per share for cash proceeds of $12,920,000 (net of issuance costs of $66,000). In connection with the issuance of its Series C redeemable convertible preferred stock, the Company issued the Series C stockholders warrants to purchase a total of 5,773,741 shares of Series C redeemable convertible preferred stock at a price of $0.01 per share (the “Series C Warrants”). These warrants are exercisable at any time until seven years from the date of issuance, subject to provisions for earlier termination upon the occurrence of certain events. The Company allocated $4,608,000 of the net proceeds from the issuance of Series C redeemable convertible preferred stock as the estimated value of the Series C Warrants. As of September 30, 2007, 5,228,943 Series C Warrants had been exercised. Upon the occurrence of an initial public offering of the Company’s common stock at a price per share of not less than $3.24 per share (as adjusted for any stock, dividends, combinations, or splits) with aggregate proceeds to the Company of greater than $25,000,000, unless previously exercised, the remaining warrants to purchase 544,798 shares of Series C redeemable convertible preferred stock will terminate. In October 2005, the Company reclassified the remaining outstanding 544,798 Series C Warrants from stockholders’ deficit to preferred warrant liability upon the adoption of FSP 150-5 (see Notes 2 and 4).

In January and February 2003, the Company issued an aggregate of 39,136,220 shares of Series D redeemable convertible preferred stock at $0.9007 per share for cash proceeds of $35,055,000 (net of issuance costs of $195,000). In connection with the issuance of its Series D redeemable convertible preferred stock, the Company issued the Series D stockholders warrants to purchase a total of 5,870,424 shares of Series D redeemable convertible preferred stock at a price of $0.9007 per share (the “Series D Warrants”). These warrants are exercisable at any time until seven years from the date of issuance, subject to provisions for earlier termination upon the occurrence of certain events. The Company allocated $3,619,000 of the net proceeds from the issuance of Series D redeemable convertible preferred stock as the estimated value of the Series D Warrants. As of September 30, 2007, no Series D warrants have been exercised. Upon the occurrence of a Qualified IPO (as defined under —Conversion Rights below), unless previously exercised, the Series D warrants will terminate. In October 2005, the Company reclassified the outstanding 5,870,424 Series D Warrants from stockholders’ deficit to preferred warrant liability upon the adoption of FSP 150-5 (see Notes 2 and 4).

F-21

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. REDEEMABLE CONVERTIBLE PREFERRED STOCK (Continued)

In February, June and July 2004, the Company issued an aggregate of 40,839,559 shares of Series D' redeemable convertible preferred stock at $0.9007 per share for cash proceeds of $36,701,000 (net of issuance costs of $83,000). In connection with the issuance of Series D' redeemable convertible preferred stock, the Company issued the Series D' stockholders warrants to purchase a total of 6,125,929 shares of Series D' redeemable convertible preferred stock at a price of $0.9007 per share (the “Series D' Warrants”). These warrants are exercisable at any time until seven years from the date of issuance, subject to mandatory exercise provisions upon the occurrence of certain events. The Company allocated $3,747,000 of the net proceeds from the issuance of its Series D' redeemable convertible preferred stock as the estimated value of the Series D' Warrants. As of September 30, 2007, no Series D' Warrants have been exercised. Upon the occurrence of a Qualified IPO, unless previously exercised, the Series D' warrants will be automatically exercised on a cashless basis, resulting in the net issuance of that number of shares of the Company’s common stock as is determined based upon the fair market value of the common stock immediately prior to the closing of the Qualified IPO. In October 2005, the Company reclassified the outstanding 6,125,929 Series D' Warrants from stockholders’ deficit to preferred warrant liability upon the adoption of FSP 150-5 (see Notes 2 and 4).

In November 2005, the Company issued 22,204,950 shares of Series D' redeemable convertible preferred stock at $0.9007 per share for cash proceeds of $19,950,000 (net of issuance costs of $50,000). In connection with the issuance of Series D' redeemable convertible preferred stock, the Company issued the Series D' stockholders warrants to purchase a total of 3,330,742 shares of Series D' redeemable convertible preferred stock at a price of $0.9007 per share. These warrants are exercisable at any time until seven years from the date of issuance, subject to mandatory exercise provisions upon the occurrence of certain events. The Company allocated $2,156,000 of the net proceeds from the issuance of Series D' redeemable convertible preferred stock as the estimated fair value of the Series D' warrants, which was recorded in preferred warrant liability in the consolidated balance sheet in accordance with FSP 150-5 (see Notes 2 and 4). The Company determined the fair value of these warrants using the Black-Scholes option-pricing model with the following assumptions: estimated volatility of 74.6%, zero dividend yield, contractual life of seven years and risk free interest rate of 4.6%. As of September 30, 2007, no Series D' warrants have been exercised. Upon the occurrence of a Qualified IPO, unless previously exercised, the warrants will be automatically exercised on a cashless basis, resulting in the net issuance of that number of shares of the Company’s common stock as is determined based upon the fair market value of the common stock immediately prior to the closing of the Qualified IPO.

In October 2006, the Company issued 8,837,409 shares of Series E redeemable convertible preferred stock at $1.1655 per share for cash proceeds $10,246,000 (net of issuance costs of $54,000).

The significant terms and conditions of the redeemable convertible preferred stock as of September 30, 2007, are as follows:

Dividend Rights—The holders of Series D and Series D' redeemable convertible preferred stock are entitled to receive, prior to any payment of dividends to the holders of any other class or series of stock, cumulative dividends of $0.0721 per share per annum (as adjusted for any stock dividends, combinations, or splits with respect to such series), when and if declared by the Board.

In addition to such cumulative dividends, the holders of Series D and Series D' redeemable convertible preferred stock are entitled to receive cumulative dividends in the event of any liquidation, dissolution, or winding up of the Company (“Liquidation Dividends”), whether voluntary or involuntary. The amounts of such Liquidation Dividends are described under —Liquidation Preference below.

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DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. REDEEMABLE CONVERTIBLE PREFERRED STOCK (Continued)

The holders of Series A, Series B-1, Series C and Series E redeemable convertible preferred stock are entitled to receive, prior to any payment of dividends to the holders of common stock, non-cumulative annual dividends at a rate of $0.086, $0.1168, $0.0990 and $0.0932 per share (as adjusted for any stock dividends, combinations, or splits with respect to such series), respectively, when and if declared by the Board.

If additional dividends are declared by the Board, after the holders of the Series A, Series B-1, Series C, Series D, Series D' and Series E redeemable convertible preferred stock have received the dividend payments to which they are entitled (other than Liquidation Dividends), then such dividends shall be paid to each of such holders and to each holder of the Company’s common stock on a pari passu, as-converted to common stock basis.

No dividends have been declared on any class of stock as of September 30, 2007.

Liquidation Preference—In the event of any liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary, or upon a change of control of the Company or sale of all or substantially all of the Company’s assets, the holders of Series D and Series D' redeemable convertible preferred stock are entitled to receive, prior and in preference to any distribution on any other series or class of stock, an amount equal to:

• $1.3511 per share, plus Liquidation Dividends of $0.0721 per annum (as adjusted for any stock dividends, combinations, or splits with respect to such series), if the valuation of the Company is less than or equal to $250,000,000;

• $0.9007 per share, plus Liquidation Dividends of $0.045 per annum (as adjusted for any stock dividends, combinations, or splits with respect to such series), if the valuation of the Company is between $250,000,000 and $500,000,000;

• $0.9007 per share (as adjusted for any stock dividends, combinations, or splits with respect to such series), if the valuation of the Company is greater than $500,000,000; or

• in a circumstance in which the valuation of the Company is greater than $250,000,000 but the amount to be paid to the holders of Series D and Series D' redeemable convertible preferred stock is less than the amount that would have been paid to the holders of Series D and Series D' redeemable convertible preferred stock had the valuation of the Company been $250,000,000 or less (the “Minimum Consideration”), the Minimum Consideration.

If the assets and funds distributed among the holders of Series D and Series D' redeemable convertible preferred stock are insufficient to permit the payment to such holders of their full preferential amount, then the entire assets and funds of the Company legally available for distribution shall be distributed ratably among the holders of Series D and Series D' redeemable convertible preferred stock in proportion to the preferential amount each such holder is otherwise entitled to receive.

After the distribution in full of the liquidation preferences described above to the holders of Series D and Series D' redeemable convertible preferred stock, the holders of Series A, Series B-1, Series C and Series E redeemable convertible preferred stock are entitled to receive, on a pari passu basis, prior and in preference to any distribution to the holders of common stock, an amount equal to $1.08, $1.4596, $1.2371 and $1.1655 per share, respectively, plus all declared but unpaid dividends. If the assets and funds distributed among the holders of Series A, Series B-1, Series C and Series E redeemable convertible preferred stock are insufficient to permit the payment to such holders of their full preferential amount, then the entire remaining assets and funds of the Company legally available for distribution shall be distributed ratably among the holders of Series A, Series B-1, Series C and Series E redeemable convertible preferred stock in proportion to the preferential amount each such

F-23

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. REDEEMABLE CONVERTIBLE PREFERRED STOCK (Continued)

holder is otherwise entitled to receive. Upon the completion of the distribution to the holders of Series A, Series B-1, Series C and Series E redeemable convertible preferred stock, any remaining assets and funds of the Company available for distribution shall be distributed pro rata among the holders of shares of Series D and Series D' redeemable convertible preferred stock and holders of shares of common stock based on the number of shares of common stock held, on an as-converted basis.

Conversion Rights—Each share of Series A redeemable convertible preferred stock is convertible into one share of common stock and is not entitled to price based anti-dilution. Each share of Series C, Series D and Series E redeemable convertible preferred stock is convertible into one share of common stock, subject to adjustments for price-based anti-dilution. Each share of Series B-1 redeemable convertible preferred stock is convertible into 1.0323 shares of common stock, subject to adjustments for price-based anti-dilution. Each share of Series D' redeemable convertible preferred stock is convertible into 1.2988 shares of common stock, subject to adjustments for price-based anti-dilution. Each share of redeemable convertible preferred stock shall automatically be converted into common stock upon the earlier of (i) the date specified by vote or written consent of the holders of at least a majority of the outstanding shares of redeemable convertible preferred stock, including at least two-thirds of the outstanding Series D and Series D' redeemable convertible preferred stock, voting together as a single class, or (ii) a public offering of stock at an offering price that values the Company at not less than $373,000,000 and in which the aggregate proceeds to the Company exceed $35,000,000 (a “Qualified IPO”).

Redemption—The holders of at least a majority of the redeemable convertible preferred stock, voting together as a single class, may require the Company to redeem all or a portion of the outstanding redeemable convertible preferred stock in three annual installments beginning any time after January 27, 2008 and ending on the earlier of (i) January 27, 2010, or (ii) the date a Qualified IPO is consummated. The redemption prices for the Series A, Series B-1, Series C, Series D, Series D' and Series E redeemable convertible preferred stock are $1.08, $1.4596, $1.2371, $0.9007, $0.9007 and $1.1655 per share, respectively, (as adjusted for any stock dividends, combinations, or splits with respect to such series) plus any declared but unpaid dividends. In addition, the Series A, Series B-1, Series C, Series D, Series D' and Series E stockholders will receive an amount per share equal to $0.086, $0.1168, $0.0990, $0.0721, $0.0721 and $0.0932, respectively, per annum from the date on which such shares were first issued (as adjusted for any stock dividends, combinations, or splits with respect to such series) (the “Additional Redemption Amount”). If the funds legally available for redemption are insufficient to redeem all the Series A, Series B-1, Series C, Series D, Series D' and Series E redeemable convertible preferred stock to be redeemed on a redemption date, then such funds shall be first used to redeem the Series D and Series D' redeemable convertible preferred stock. If the funds legally available for redemption are insufficient to redeem all the Series D and Series D' redeemable convertible preferred stock, then any available funds shall be distributed ratably among the holders of Series D and Series D' redeemable convertible preferred stock in proportion to the preferential amount each such holder is otherwise entitled to receive. After full redemption of the Series D and Series D' redeemable convertible preferred stock, any remaining funds will be used to redeem the shares of Series A, Series B-1, Series C and Series E redeemable convertible preferred stock on a pro-rata basis.

The Company records accretion for the difference between the initial recorded value of the outstanding redeemable convertible preferred stock and the redemption price plus the Additional Redemption Amount over the redemption period. In addition, because the exercise price of the Series C Warrants is significantly lower than the fair value of the underlying stock, management considers it probable that these warrants will be exercised. Accordingly, the Company records accretion for the difference between the value ascribed to Series C Warrants and the redemption price of the underlying shares on the date the Series C Warrants were issued. The Company

F-24

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. REDEEMABLE CONVERTIBLE PREFERRED STOCK (Continued)

has recorded accretion of $12,309,000, $14,477,000 and $15,710,000 related to the redeemable convertible preferred stock and Series C Warrants for the years ended September 30, 2005, 2006 and 2007, respectively.

Voting Rights—Each share of Series A, Series B-1, Series C, Series D, Series D' and Series E redeemable convertible preferred stock has voting rights equivalent to the number of shares of common stock into which it is convertible.

Registration and Other Rights—The holders of redeemable convertible preferred stock have certain registration rights, which expire five years after the consummation of an initial public offering by the Company. Holders of redeemable convertible preferred stock that hold greater than a certain number of preferred shares and/or common shares also have a right of first offer with respect to future sales of the Company’s stock. The right of first offer expires upon an acquisition of all or substantially all of the Company’s assets, an acquisition or merger of the Company which results in a change of control or a Qualified IPO.

Additional Redeemable Convertible Preferred Stock Warrants—During the year ended September 30, 2002, the Company issued a warrant to purchase 68,512 shares of Series B-1 redeemable convertible preferred stock at $1.4596 per share, which was subsequently adjusted to $1.3741 per share, in connection with a capital lease financing. The warrant is immediately exercisable and expires in 2009. The Company determined the fair value of such warrant using the Black-Scholes option-pricing model with the following assumptions: estimated volatility of 85.0%, zero dividend yield, contractual life of seven years and risk-free interest rate of 4.6%. The Company recorded the fair value of such warrants of $66,000 as a discount to the related capital lease obligations, which is being amortized as additional interest expense over the term of the financing arrangement. As of September 30, 2007, this warrant had not been exercised. Upon the occurrence of a Qualified IPO, unless previously exercised, such warrant will automatically convert into a warrant to purchase 70,724 shares of the Company’s common stock at $1.3311 per share. In October 2005, the Company reclassified the fair value of the warrant from stockholders’ deficit to preferred warrant liability upon the adoption of FSP 150-5 (see Notes 2 and 4). Subsequent changes in fair value of the warrant have been recorded as change in fair value of preferred warrant liability in other income (expense), net on the Company’s consolidated statements of operations.

During the year ended September 30, 2004, the Company issued warrants to purchase 33,307 and 6,588 shares of Series D redeemable convertible preferred stock at $0.9007 per share in connection with capital lease financings. The warrants are immediately exercisable and expire in December 2010 and September 2011, respectively. The Company determined the fair value of such warrants using the Black-Scholes option-pricing model with the following assumptions: estimated volatility of 85.0%, zero dividend yield, contractual life of seven years and risk-free interest rate of 3.9%. The Company recorded the fair value of such warrants of $22,000 as a discount to the related capital lease obligations, which is being amortized as additional interest expense over the term of the financing arrangement. As of September 30, 2007, the warrants have not been exercised. Upon the occurrence of a Qualified IPO, unless previously exercised, such warrants will automatically convert into warrants to purchase 39,895 shares of the Company’s common stock at $0.9007 per share. In October 2005, the Company reclassified the fair value of the warrants from stockholders’ deficit to preferred warrant liability upon the adoption of FSP 150-5 (see Notes 2 and 4). Subsequent changes in fair value of the warrant have been recorded as change in fair value of preferred warrant liability in other income (expense), net on the Company’s consolidated statements of operations.

In March 2005, the Company entered into an agreement with T-Mobile under which the Company agreed to grant a venture fund controlled by T-Mobile (the “T-Mobile Venture Fund”) a warrant to purchase 1,539,914 shares of Series D' redeemable convertible preferred stock at an exercise price of $0.9007 per share in consideration for T-Mobile’s launch of the Company’s mobile data services in Germany. In June 2005, in

F-25

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. REDEEMABLE CONVERTIBLE PREFERRED STOCK (Continued)

connection with such launch, the Company recorded the fair value of the commitment to issue such warrant of $751,000 as accrued expenses and other current liabilities, since the underlying warrant was not authorized by the Company’s stockholders and hence was not issued. The Company determined the fair value of the obligation to issue such warrant using the Black-Scholes option-pricing model to value the underlying warrant with the following assumptions: estimated volatility of 74.0%, zero dividend yield, contractual life of 3.5 years and risk free interest rate of 3.6%. As of September 30, 2005, the Company remeasured the warrant’s fair value and adjusted the balance of the liability recorded in accrued expenses and other liabilities to $729,000, which was correspondingly recorded as a reduction in service revenues in conjunction with the recognition of cumulative deferred revenues related to the T-Mobile USA arrangement in September 2005. In November 2005, the Company issued the warrant to the T-Mobile Venture Fund as committed, remeasured the fair value of the warrant to $608,000 and reclassified the fair value of the warrant to preferred warrant liability in the consolidated balance sheets. Subsequent changes in fair value of the warrant have been recorded as change in fair value of preferred warrant liability in other income (expense), net on the Company’s consolidated statements of operations (see Notes 2 and 4). The warrant is exercisable immediately and expires three years from the issuance date, subject to mandatory exercise provisions upon the occurrence of certain events. As of September 30, 2007, the warrant has not been exercised. Upon the occurrence of a Qualified IPO, unless previously exercised, the warrant will be automatically exercised on a cashless basis, resulting in the net issuance of that number of shares of the Company’s common stock as is determined based upon the fair market value of the common stock immediately prior to the closing of the Qualified IPO.

In September 2006, the Company entered into a software license, product development and distribution agreement with Motorola. In conjunction with such agreement, the Company issued Motorola a warrant to purchase 3,849,783 shares of Series D' redeemable convertible preferred stock at $0.9007 per share. The warrant is exercisable immediately and expires three years from the issuance date, subject to mandatory exercise provisions upon the occurrence of certain events. Motorola is entitled to exercise the unvested portion of the warrant to purchase unvested common shares under the warrant; however, the Company has a right to repurchase the unvested common shares at the original exercise price. Upon the signing of the agreement, 50% of the common shares subject to the warrant vested. The remaining common shares subject to the warrant will vest if Motorola delivers certain performance requirements by December 31, 2007. The Company determined the fair value of the vested portion of the warrant using the Black-Scholes option-pricing model with the following assumptions: estimated volatility of 55.2%, zero dividend yield, contractual life of three years and risk-free interest rate of 4.7%. The Company recorded the fair value of the vested portion of the warrant with respect to 1,924,892 shares of Series D' redeemable convertible preferred stock of $982,000 as an increase in research and development expense and a corresponding increase in preferred warrant liability during the year ended September 30, 2006. Subsequent changes in fair value of the vested portion of the warrant have been recorded as change in fair value of preferred warrant liability in other income (expense), net on the Company’s consolidated statements of operations (see Notes 2 and 4). In addition, the Company will estimate and recognize the fair value of the unvested portion of the warrant as expense at such time as Motorola meets the performance requirements. As of September 30, 2007, the warrant has not been exercised. Upon the occurrence of a Qualified IPO, unless previously exercised, the warrant will be automatically exercised on a cashless basis, resulting in the net issuance of that number of shares of the Company’s common stock as is determined based upon the fair market value of the common stock immediately prior to the closing of the Qualified IPO.

In October 2006, the Company issued a warrant to purchase 128,700 shares of Series E redeemable convertible preferred stock at $1.1655 per share in connection with a capital lease financing. The warrant is immediately exercisable and expires in October 2013, subject to mandatory exercise provisions upon the occurrence of certain events. The Company determined the fair value of the warrant using the Black-Scholes

F-26

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. REDEEMABLE CONVERTIBLE PREFERRED STOCK (Continued)

option-pricing model with the following assumptions: estimated volatility of 70.3%, zero dividend yield, contractual life of seven years and risk-free interest rate of 4.8%. The Company recorded the fair value of such warrant of $39,000 as a discount to the related capital lease obligation, which is being amortized as additional interest expense over the term of the financing arrangement and a corresponding liability as a preferred warrant liability on the Company’s consolidated balance sheets. Subsequent changes in fair value of the warrant have been recorded as change in fair value of preferred warrant liability in other income (expense), net on the Company’s consolidated statements of operations (see Notes 2 and 4). Upon the occurrence of a Qualified IPO, unless previously exercised, the warrant will be automatically exercised on a cashless basis, resulting in the net issuance of that number of shares of the Company’s common stock as is determined based upon the fair market value of the common stock immediately prior to the closing of the Qualified IPO.

6. STOCKHOLDERS’ DEFICIT

As of September 30, 2007, the Company has reserved shares of common stock for the conversion of redeemable convertible preferred stock, the exercise of warrants to purchase the Company’s redeemable convertible preferred stock and the issuance of options granted under the Company’s stock option plan as follows:

Redeemable convertible preferred stock	168,133,864
Warrants to purchase redeemable convertible preferred stock	25,936,605
Stock option plan	44,917,590
	238,988,059

Early Exercise of Stock Options—Certain stock options granted by the Company are exercisable at the date of grant with unvested shares subject to repurchase by the Company in the event of voluntary or involuntary termination of employment of the stockholder. Effective October 1, 2006, in accordance with SFAS 123(R), cash received from all such exercises of options granted on or after October 1, 2006 is recorded as a liability on the balance sheet and reclassified into stockholders’ deficit as the options vest. Prior to October 1, 2006, in accordance with EITF 00-23, Issues Related to Accounting for Stock Compensation under APB Opinion No. 25 and FASB Interpretation No. 44, the consideration received from the exercise of stock options granted or modified after March 21, 2002, and subject to repurchase at the original exercise price, was recorded as a liability and reclassified to stockholders’ deficit as the common stock vested, while consideration received from the exercise of stock options granted or modified after March 21, 2002, and subject to repurchase at the lesser of the original exercise price or fair market value, was recorded in stockholders’ deficit.

On June 9, 2006, the Company’s Board approved an amendment to the 2000 Stock Option/Stock Issuance Plan (the “Plan”), under which the repurchase price of unvested shares of stock options issued subsequent to June 9, 2006 by the Company will be at the lower of the fair market value of the underlying common stock at the shareholder’s cessation of service or the original exercise price. Prior to June 9, 2006, the repurchase price of unvested shares of stock options by the Company was at the original exercise price.

As of September 30, 2006 and 2007, 1,053,816 and 863,515 shares of common stock were subject to repurchase by the Company. Included in these amounts were 606,835 and 485,167 shares of common stock, respectively, that were either granted prior to June 10, 2006 and subject to repurchase by the Company at the original exercise price, or granted subsequent to October 1, 2006. The corresponding exercise value of $152,000 and $157,000 as of September 30, 2006 and 2007, respectively, is recorded in accrued expenses and other current liabilities on the Company’s consolidated balance sheets.

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DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. STOCKHOLDERS’ DEFICIT (Continued)

The activity for the year ended September 30, 2007 of unvested shares acquired through the early exercise of options granted to employees is as follows:

	Shares		Weighted Average Grant Date Fair Value
Unvested shares at September 30, 2006	1,053,816		$	0.25
Early exercise of options	391,934			0.34
Vested	(523,380	)		0.25
Repurchased	(58,855	)		0.25
Unvested shares at September 30, 2007	863,515			0.29

Stock Option Plan—In October 2000, the Company adopted the 2000 Stock Option/Stock Issuance Plan (the “Plan”) which is divided into two separate equity programs: (1) an option grant program under which eligible employees, consultants and independent advisors may be granted both incentive and non statutory options to purchase shares of common stock, and (2) a stock issuance program under which eligible employees, consultants and independent advisors may be issued shares of common stock directly, either through immediate purchase of such shares or as consideration for services rendered to the Company (“Stock Purchase Rights”). As of September 30, 2007, 51,207,696 shares of common stock are authorized for issuance under the Plan. The Company issues new shares of common stock upon the exercise of options or Stock Purchase Rights.

The Plan permits Stock Purchase Rights and non statutory stock options to be granted at prices no less than 85% of the fair market value per share of the Company’s common stock on the option grant date. Incentive options must be granted at prices no less than 100% of the fair market value per share of common stock on the option grant date. If the Stock Purchase Rights or options are granted to a 10% stockholder, then the purchase or exercise price per share may not be less than 110% of the fair market value per share of the Company’s common stock on the grant date. Stock option grants are generally immediately exercisable and options generally expire ten years from the date of grant. Vesting terms under the Plan are generally over 48 months, which include certain grants vesting based on 2.08% of the shares per month and certain grants vesting based on a one year cliff of 25% of the shares and 2.08% of the shares monthly thereafter. As of September 30, 2007, 2,056,194 shares were available for future grant under the Plan.

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DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. STOCKHOLDERS’ DEFICIT (Continued)

A summary of option activity under the Plan for the year ended September 30, 2007 is as follows:

	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
						(In thousands)
Outstanding at September 30, 2006	29,929,526		$	0.25
Granted at fair value (weighted average grant date fair value of $0.31)	15,290,200			0.55
Exercised	(1,172,748	)		0.28
Canceled	(1,185,582	)		0.31
Outstanding at September 30, 2007	42,861,396			0.35	7.9	$	12,671
Exercisable at September 30, 2007	20,130,669			0.26	6.5		7,823
Vested and expected to vest at September 30, 2007	40,336,775			0.35	7.8		12,184

The weighted average grant date fair value per share of employee stock options granted during the years ended September 30, 2005 and 2006 was $0.04 and $0.06, respectively. Such fair value was determined by using the minimum value method pursuant to SFAS 123.

As required by SFAS 123(R), the Company has made an estimate of expected forfeitures and is recognizing compensation cost only for those equity awards expected to vest.

The aggregate intrinsic value of options in the table above is the total pretax intrinsic value (i.e. the difference between the estimated fair value of the Company’s common stock on September 30, 2007 and the exercise price, multiplied by the number of shares issuable upon exercise of the option) that would have been received by the option holders had all option holders exercised their options on September 30, 2007. The aggregate intrinsic value of options exercised was approximately $15,000, $8,000, and $298,000 in the years ended September 30, 2005, 2006 and 2007, respectively.

Stock-Based Compensation—Effective October 1, 2006, the Company adopted SFAS 123(R) which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and directors based on estimated fair values. In March 2005, the SEC issued SAB Topic 14, Share Based Payment (“SAB 107”) and the Company has applied the provisions of SAB 107 in its adoption of SFAS 123(R). Prior to October 1, 2006, the Company accounted for share-based payments using the intrinsic value method in accordance with APB 25, as permitted by SFAS 123. Under APB 25, stock-based compensation expense was recognized only when the fair market value of the Company’s common stock issuable upon exercise of stock options granted to employees and directors was greater than the exercise price of such options at the date of grant. Accordingly, no stock-based employee compensation expense has been reflected in the consolidated statements of operations for the years ended September 30, 2005 and 2006 as all options granted had an exercise price equal to or greater than the fair market value of the underlying common stock on the date of grant.

The Company adopted SFAS 123(R) using the prospective transition method. Under that transition method, stock-based compensation cost recognized in the year ended September 30, 2007 includes stock-based compensation cost for all share-based payments granted on or modified and subsequent to October 1, 2006, based on the fair value estimated in accordance with the provisions of SFAS 123(R). SFAS 123(R) requires companies to

F-29

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. STOCKHOLDERS’ DEFICIT (Continued)

estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods. SFAS 123(R) requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. In accordance with the prospective transition method, prior periods have not been restated to reflect, and do not include, the impact of SFAS 123(R) and share-based awards granted prior to October 1, 2006 continue to be accounted for in accordance with APB 25.

The following stock-based compensation expense was recorded under SFAS 123(R) in the Company’s consolidated statements of operations (in thousands) in the year ended September 30, 2007:

Cost of revenues	$	82
Research and development		144
Sales and marketing		30
General and administrative		73

As a result of adopting SFAS 123(R) on October 1, 2006, the Company’s loss before income taxes and cumulative effect of change in accounting principle and net loss for the year ended September 30, 2007 is $329,000 higher than if the Company had continued to account for stock-based compensation under APB 25. Diluted net loss per share for the year ended September 30, 2007 is $0.02 higher than if the Company had continued to account for stock-based compensation under APB 25. There was no compensation cost capitalized as part of an asset in the year ended September 30, 2007. The Company has not recognized, and does not expect to recognize in the near future, any tax benefit related to employee stock-based compensation cost as a result of the full valuation allowance on its net deferred tax assets and its net operating loss carryforwards.

As of September 30, 2007, the total compensation cost related to unvested stock-based awards granted to employees under the Company’s stock option plans but not yet recognized was $3,828,000, net of estimated forfeitures. This cost will be amortized on straight-line basis over a weighted average term of 3.7 years and will be adjusted for subsequent changes in estimated forfeitures.

The Company uses the Black-Scholes option-pricing model. Option valuation models require the input of highly subjective assumptions including the expected life of the stock-based award and the estimated stock volatility. The assumptions discussed herein represent management’s best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, if other assumptions had been used, the recorded stock-based compensation expense could have been materially different. In addition, under SFAS 123(R), the Company is expected to estimate the expected forfeiture rate and only recognize expense for those shares expected to vest. If the actual forfeiture rate is materially different from the estimate, the stock-based compensation expense could be materially different.

For the year ended September 30, 2007, the Company estimated the fair value of each option on the date of grant using the Black-Scholes option-pricing model utilizing the following assumptions:

Estimated volatility	59.4	%
Expected dividend yield	0.0	%
Expected life (years)	5.3
Weighted average risk-free interest rate	5.0	%

Estimated volatility—Since its adoption of SFAS 123(R), the Company has calculated volatility based upon the trading history and implied volatility of the common stock of comparable technology companies. Comparable

F-30

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. STOCKHOLDERS’ DEFICIT (Continued)

companies include other public companies in the technology industry similar in size, stage of development and financial leverage.

Expected dividend yield—The Company has not declared or paid any cash dividends and does not presently plan to pay cash dividends in the foreseeable future. Therefore, the Company uses an expected dividend yield of zero.

Weighted average risk-free interest rate —The Company bases the weighted average risk-free interest rate used in the Black-Scholes valuation method on the implied yield currently available on U.S. Treasury constant maturity securities with the same or substantially equivalent remaining term as its stock options.

Expected life—The Company’s expected life represents the period that the Company’s share-based awards are expected to be outstanding. Upon the adoption of SFAS 123(R) on October 1, 2006, as permitted by SAB 107, the Company adopted a temporary “shortcut approach” to developing the estimate of the expected term of an employee stock option through March 31, 2007. Under this approach, the expected life is presumed to be the mid-point between the vesting date and the contractual end of the option. Under the original guidance in SAB 107, the “short-cut approach” was not expected to be permitted for options granted, modified or settled after December 31, 2007. Commencing April 1, 2007, the Company has estimated the expected life of employee stock options based on the expected terms of options granted by publicly-traded peers and the historical experience of the Company’s similar awards.

Estimated forfeitures—SFAS 123(R) requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from these estimates. When estimating forfeitures, the Company considers voluntary and involuntary termination behavior as well as analysis of actual option forfeitures.

Equity Awards Issued to Non-employees—Under the Plan, the Company issued 30,000, 5,000 and 50,000 stock options to non-employees during the years ended September 30, 2005, 2006 and 2007, respectively. As of September 30, 2006 and 2007, 5,000 and 47,159 non-employee options had not yet vested and are subject to variable accounting, respectively. The fair value of the options granted to non-employees for the years ended September 30, 2005, 2006 and 2007 was estimated using the Black-Scholes option-pricing model with the following assumptions:

	Years Ended September 30,
	2005		2006		2007
Estimated volatility	85.0	%	85.0	%	63.5%-70.6	%
Expected dividend yield	0.0	%	0.0	%	0.0	%
Expected life (years)	10.0		9.0		6.6-10.0
Weighted average risk-free interest rate	4.0	%	4.0	%	4.3%-5.0	%

In April 2005, a grantee changed from employee to non-employee status. The Company used the Black-Scholes option-pricing model to measure the fair value of 329,167 shares of options, which represented the unvested portion of such grantee’s stock options at the date employment status changed, using the following assumptions; estimated volatility of 85.0%, zero dividend yield, expected life of 2.3 years and risk-free interest rate of 3.8%. In July 2005, the Company terminated the service of this individual and, as a result, the remaining options ceased vesting and no further compensation expense was recorded.

The Company recorded stock-based compensation expense of $21,000, $4,000 and $25,000 related to non-employee options during the years ended September 30, 2005, 2006 and 2007, respectively.

F-31

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

7. INCOME TAXES

The Company’s income tax provision is associated entirely with foreign taxes resulting from operations in the United Kingdom. The Company has no provision for domestic income taxes due to its net losses. The reported amount of income tax expense attributable to continuing operations for the year differs from the amount that would result from applying domestic federal statutory tax rates to pretax income from continuing operations primarily because of the Company’s unused net operating losses.

Provision for income taxes is as follows (in thousands):

	Years Ended September 30,
	2005		2006		2007
Current:
Federal	$	—	$	—	$	—
State		—		—		—
Foreign		—		54		74
Total current income taxes		—		54		74
Deferred:
Federal		—		—		—
State		—		—		—
Foreign		—		—		—
Total deferred income taxes		—		54		74
Total provision for income taxes	$	—	$	54	$	74

The reconciliation of income tax expenses at the statutory federal income tax rate of 34% to the Company’s provision for income taxes included in its consolidated statements of operations for the years ended September 30, 2005, 2006 and 2007 is as follows (in thousands):

	Years Ended September 30,
	2005			2006			2007
U.S Federal taxes benefit at statutory tax rate	$	(3,369	)	$	(2,191	)	$	(4,115	)
Foreign rate differential		1			73			78
Permanent differences		39			(115	)		420
Change in valuation allowance		3,769			3,033			4,701
Research and development credits		(440	)		(746	)		(1,010	)
Total	$	—		$	54		$	74

F-32

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

7. INCOME TAXES (Continued)

Significant components of the Company’s net deferred tax assets for federal and state income taxes at September 30, 2006 and 2007 consist of the following (in thousands):

	As of September 30,
	2006			2007
Deferred tax assets:
Net operating loss carryforwards	$	37,631		$	42,179
Tax credit carryforwards		5,169			6,859
Warranty reserves		41			10
Accruals and reserves recognized in different periods		2,015			1,361
Depreciation and amortization		159			—
Deferred revenues and costs		1,733			2,535
Total deferred tax assets		46,748			52,944
Deferred tax liabilities:
Depreciation and amortization		—			(259	)
Total deferred tax liabilities		—			(259	)
Valuation allowance		(46,748	)		(52,685	)
Net deferred tax assets	$	—		$	—

The Company’s accounting for deferred taxes under SFAS 109 involves the evaluation of a number of factors concerning the realizability of the Company’s net deferred tax assets. Management primarily considers such factors as the Company’s history of operating losses, the nature of the Company’s net deferred tax assets and the timing, likelihood and amount, if any, of future taxable income during the periods in which those temporary differences and carryforwards become deductible. At present, management does not believe that it is more likely than not that the net deferred tax assets will be realized. Accordingly, a full valuation allowance has been established and no net deferred tax asset is shown in the Company’s consolidated balance sheets.

As of September 30, 2007, the Company has federal and state net operating loss carryforwards of approximately $110,000,000 and $81,000,000, respectively, expiring through 2027 and 2017, respectively.

As of September 30, 2007, the Company also has research and development credits of approximately $5,100,000 and $5,200,000 available to offset future federal and state income taxes, respectively. The federal tax credit carryforwards expire through 2027. The state tax credit carryforwards have no expiration.

Current federal and California tax law includes provisions limiting the annual use of net operating loss and credit carryforwards in the event of certain defined changes in stock ownership. The Company’s capitalization described herein may have resulted in such a change. Accordingly, the annual use of the Company’s net operating loss and credit carryforwards would be limited according to these provisions. Such limitation may result in the loss of net operating loss carryforward benefits.

F-33

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

8. EMPLOYEE BENEFIT PLANS

The Company has a defined contribution 401(k) tax-deferred savings plan (the “Savings Plan”), which permits participants to make contributions by salary deductions pursuant to Section 401(k) of the Internal Revenue Code. The Savings Plan allows but does not require contributions by the Company. As of September 30, 2007, no contributions have been made to the Savings Plan by the Company.

The Company sponsors additional defined contribution plans for most, but not all of our employees located outside of the United States. Contributions under all such plans were $11,000 and $18,000 in the years ended September 30, 2006 and 2007, respectively. Contributions made to the plans in the year ended September 30, 2005 were insignificant.

9. RELATED-PARTY TRANSACTIONS

T-Mobile—T-Mobile is a mobile operator in various geographies worldwide and controls the T-Mobile Venture Fund. For the years ended September 30, 2005, 2006 and 2007, the Company’s revenue from sales to T-Mobile amounted to $33,879,000, $44,814,000 and $53,309,000, respectively, representing 92%, 91% and 94% of total revenues, respectively. As of September 30, 2006 and 2007, accounts receivable from this related party were $6,817,000 and $11,550,000, respectively, representing 92% and 97% of accounts receivable, respectively. In addition, the Company receives fees from application providers for one premium application that is offered to T-Mobile USA’s subscribers and pays T-Mobile USA a share of revenues for each download of such premium application. Such fees reduce the invoiced amounts associated with premium applications, content and services in the current period that are deferred and amortized to revenues in accordance with the Company’s revenue recognition policy (see Note 1). During the years ended September 30, 2005, 2006 and 2007, as a result of the revenue sharing transactions, the Company reduced the invoiced amounts subject to deferral and amortization as described above totaling $118,000, $123,000 and $172,000, respectively. As of September 30, 2006 and 2007, payments accrued for the revenue sharing transactions, which were recorded as accrued expenses and other current liabilities, were $40,000 and $42,000, respectively.

For the years ended September 30, 2005, 2006 and 2007, the Company incurred telecommunication expenses from services provided by T-Mobile of $132,000, $154,000 and $231,000, respectively. Accounts payable related to the telecommunication expenses were $19,000 and $20,000 as of September 30, 2006 and 2007, respectively.

In March 2005, the Company entered into an agreement with T-Mobile under which the Company agreed to grant the T-Mobile Venture Fund a warrant to purchase 1,539,914 shares of Series D' redeemable convertible preferred stock at an exercise price of $0.9007 per share in consideration for T-Mobile’s launch of the Company’s mobile data services in Germany (see Note 5). In November 2005, the T-Mobile Venture Fund purchased 11,102,475 shares of Series D' redeemable convertible preferred stock at $0.9007 per share and warrants to purchase a total of 1,665,371 shares of Series D' redeemable convertible preferred stock for gross proceeds of $10,000,000 (see Note 5). As of September 30, 2007, the T-Mobile Venture Fund holds 15,925,869 shares of redeemable convertible preferred stock and warrants to purchase 3,421,566 shares of redeemable convertible preferred stock.

T-Mobile USA holds a right of first refusal on the sale of a controlling interest of the Company to a mobile operator that operates a nationwide wireless service in the United States. Such right terminates upon an initial public offering of the Company’s common stock.

F-34

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

9. RELATED-PARTY TRANSACTIONS (Continued)

Motorola—In November 2005, Motorola purchased 11,102,475 shares of Series D' redeemable convertible preferred stock at $0.9007 per share for gross proceeds of $10,000,000. In connection with the issuance of the Series D' redeemable convertible preferred stock, the Company issued a warrant to Motorola to purchase a total of 1,665,371 shares of Series D' redeemable convertible preferred stock at a price of $0.9007 per share (see Note 5).

In September 2006, the Company entered into a software license, product development and distribution agreement with Motorola. In conjunction with such agreement, the Company issued Motorola a warrant to purchase 3,849,783 shares of Series D' redeemable convertible preferred stock at $0.9007 per share (see Note 5).

10. COMMITMENTS AND CONTINGENCIES

Leases—The Company leases its facilities and office buildings under operating leases that expire at various dates through December 2011. Certain leases also contain escalation clauses and renewal option clauses calling for increased rents. Where a lease contains an escalation clause or a concession such as a rent holiday, rent expense is recognized in accordance with FASB Technical Bulletin 85-3, Accounting for Operating Leases with Scheduled Rent Increases, using the straight line method over the term of the lease. Total rental expense was $497,000, $643,000 and $1,604,000 for the years ended September 30, 2005, 2006 and 2007, respectively. In addition, under certain leases, the Company is granted with an option to early terminate the lease by providing an advance notice and paying an early termination fee. The Company does not intend early termination of the leases and hence the future minimum operating lease commitments disclosed herein consist of the total lease payments through the end of the initial lease terms.

In October 2006, the Company entered into an agreement to obtain a lease line-of-credit in the amount of $5,000,000. As of September 30, 2007, the full amount had been drawn under the line-of-credit, which together with interest is subject to repayment over a 36 month term. The amount of future minimum commitments resulting from this lease of $4,426,000 is included in the future minimum capital lease commitments disclosed herein. In connection with this capital lease agreement, the Company also issued a warrant to purchase 128,700 shares of Series E redeemable convertible preferred stock at $1.1655 per share (see Note 5).

In connection with a certain lease agreement entered into during the year ended September 30, 2005, the Company was required to deposit $3,600,000 in a restricted bank account. The Company terminated the lease during the year ended September 30, 2006, which resulted in the Company paying a $1,000 prepayment premium and paying principal and interest accrued through the termination date totaling $2,757,000. In conjunction with the termination of this lease, $3,600,000 of restricted cash was released.

F-35

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

10. COMMITMENTS AND CONTINGENCIES (Continued)

As of September 30, 2007, future minimum lease commitments under capital and operating leases are as follows (in thousands):

Years Ending September 30,	Capital Leases			Operating Leases
2008	$	2,445		$	1,710
2009		1,930			1,776
2010		807			917
2011		—			529
2012		—			115
Thereafter		—			—
Total minimum payments		5,182		$	5,047
Less amounts representing interest		(654	)
Less unamortized value of warrants issued to lessor (see Note 5)		(27	)
Present value of future minimum payments		4,501
Less current portion		(1,854	)
Long-term portion	$	2,647

In addition to the amounts reflected as restricted cash (see Note 1), the Company has provided security deposits for its facilities leases in the amount of $142,000 and $201,000 as of September 30, 2006 and 2007, respectively, of which $100,000 and $155,000, respectively, were recorded as non-current assets.

Other Commitments—During the years ended September 30, 2005 and 2006, the Company purchased enterprise software and system maintenance totaling $287,000 and $1,845,000, respectively, payable in quarterly installments over 24 to 36 months. As of September 30, 2006 and 2007, the outstanding balance of the installment payable was $1,550,000 and $885,000, respectively, of which $665,000 and $774,000 was recorded as accrued expenses and other current liabilities on the Company’s consolidated balance sheets. In November 2007, the Company entered into a new agreement with such vendor to purchase additional enterprise software and system maintenance. As a result, commitments under the existing agreement of $484,000 outstanding as of September 30, 2007 have been included in the new agreement and the remaining balance has been paid in full (see Note 13).

The Company has entered into three internet colocation service agreements that expire in January 2009, March 2010 and October 2010, respectively, committing the Company to minimum annual service fees of $480,000, $814,000 and $1,403,000, respectively. As of September 30, 2007, the Company has remaining commitments under the service agreements totaling $6,978,000.

The Company has entered into agreements to purchase internet connectivity. As of September 30, 2007, commitments payable under these agreements are $437,000, $437,000 and $69,000 in the years ended September 30, 2008, 2009 and 2010, respectively. In November 2007, the Company entered into a new agreement with such vendor. As a result, commitments under the existing agreement in the aggregate amount of $743,000 have been included in the new agreement. (see Note 13).

Litigation—From time to time, the Company may be a party to various claims in the normal course of business. Legal fees and other costs associated with such actions are expensed as incurred. The Company assesses, in conjunction with its legal counsel, the need to record a liability for litigation and contingencies. Reserve estimates are recorded when and if it is determined that a loss related matter is both probable and reasonably estimable.

F-36

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

10. COMMITMENTS AND CONTINGENCIES (Continued)

Indemnification—The Company indemnifies other parties in the normal course of business, including customers, lessors and parties to other transactions with the Company, with respect to certain matters. Under these indemnification agreements, the Company generally agrees to defend the other party against legal actions brought by third parties that arise from a breach of the Company’s representations or covenants, or out of intellectual property infringement by the Company’s technology. Under these indemnification agreements the Company also agrees to hold the other party harmless from any losses incurred by the other parties as a result of such actions. It is not possible to determine the likelihood or magnitude of payments to be made under these agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement.

In the normal course of its business, the Company utilizes various technologies, some of which may be patented by other parties. There can be no assurances that the Company has not infringed upon a third party’s intellectual property rights. For components that the Company acquires from third-party suppliers, the Company is typically indemnified by the suppliers against any claims resulting from the violation of intellectual property rights by the suppliers.

Should the Company receive a claim, the Company evaluates the merit of the claim with the assistance of legal counsel, determines if a supplier should indemnify the Company for the claim or if the Company would be obligated to indemnify one of its partners for the claim. The Company then takes appropriate action as it deems necessary.

11. SEGMENT AND GEOGRAPHIC INFORMATION

The Company’s chief operating decision maker, its Chief Executive Officer, reviews financial information presented on a consolidated basis, accompanied by disaggregated information about revenues for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results and plans for products or components below the consolidated unit level. Accordingly, the Company considers itself to be in a single reporting segment.

The following presents total revenue by product (in thousands):

	Years Ended September 30,
	2005		2006		2007
Monthly service, client license fee and NRE fee revenues	$	20,766	$	35,931	$	46,404
Premium applications, content and services revenues		903		2,964		4,177
Product revenues		15,121		10,416		5,832
Total revenues	$	36,790	$	49,311	$	56,413

The following presents total long-lived assets by geographic region (in thousands):

	September 30,
	2006		2007
United States	$	10,852	$	15,540
Europe		1,722		1,818
Total long-lived assets	$	12,574	$	17,358

F-37

DANGER, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

11. SEGMENT AND GEOGRAPHIC INFORMATION (Continued)

More than 90% of the Company’s revenues is generated from customers located in the United States. Therefore, geographic information is presented only for long-lived assets.

12. INTEREST AND OTHER INCOME, NET

Interest and other income, net consist of the following (in thousands):

	Years Ended September 30,
	2005			2006			2007
Interest income	$	614		$	1,187		$	1,051
Gain (loss) on foreign exchange		(2	)		(30	)		10
Other income (expense)		(1	)		62			(7	)
	$	611		$	1,219		$	1,054

13. SUBSEQUENT EVENTS

In October 2007, the Company entered into a loan and security agreement with a bank providing for maximum borrowings of $12,000,000. This agreement provides for up to $5,000,000 of revolving loans and for term loans with maximum borrowings of $7,000,000. Borrowings under the revolving line, which has a one-year term, are limited to the lesser of $5,000,000, or $1,000,000, plus a predetermined percentage of eligible receivables, less amounts outstanding under letters of credit, a foreign exchange reserve and cash utilization services, which are subject to an aggregate sub-limit of $1,000,000. The loan and security agreement requires that term loans be advanced on or before March 31, 2008. The term loans are repayable over 36 months from the date they are drawn. Borrowings under the loan and security agreement are secured by substantially all of the Company’s tangible assets and certain of its intangible assets. As of November 30, 2007, the Company had drawn $3,099,000 in term loans.

In October 2007, the Company entered into an agreement for a planned new data center. This agreement has a four-year term with payments totaling $3,894,000 over the term of the agreement. The Company has an option to extend this agreement for an additional four-year term.

In November 2007, the Company entered into an agreement to upgrade its internet connectivity to support future growth. The agreement has a four-year term with payments totaling $3,696,000 over the term of the agreement. As a result, commitments under an existing agreement with such vendor in the aggregate of $743,000 have been included in the new agreement.

Also in November 2007, the Company entered into an agreement to purchase additional enterprise software and system maintenance. The agreement has a three-year term with payments totaling $4,926,000 over the term of the agreement. As a result of entering into this agreement, $484,000 of commitments outstanding under an existing agreement with this vendor as of September 30, 2007 have been included in such agreement and the remaining balance has been paid in full.

*    *    *    *    *    *

F-38

            Shares

Danger, Inc.

Common Stock

Deutsche Bank Securities UBS Investment Bank

	Thomas Weisel Partners LLC
Pacific Crest Securities		ThinkEquity Partners LLC

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

The following table sets forth all costs and expenses, other than underwriting discounts and commissions, payable by us in connection with the sale of the common stock being registered. All amounts shown are estimates except for the SEC registration fee, the FINRA filing fee and the NASDAQ Global Market filing fee.

	Amount to be Paid
SEC registration fee	$	3,072
FINRA filing fee		12,000
NASDAQ Global Market initial listing fee		125,000
Blue sky qualification fees and expenses		*
Printing and engraving expenses		*
Legal fees and expenses		*
Accounting fees and expenses		*
Transfer agent and registrar fees and expenses		*
Miscellaneous expenses		*
Total	$	*

* To be filed by amendment.

Item 14. Indemnification of Directors and Officers.

We are incorporated under the laws of the State of Delaware. Section 145 of the Delaware General Corporation Law provides that a Delaware corporation may indemnify any persons who are, or are threatened to be made, parties to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation), by reason of the fact that such person was an officer, director, employee or agent of such corporation, or is or was serving at the request of such person as an officer, director, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided that such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation’s best interests and, with respect to any criminal action or proceeding, had no reasonable cause to believe that his or her conduct was illegal. A Delaware corporation may indemnify any persons who are, or are threatened to be made, a party to any threatened, pending or completed action or suit by or in the right of the corporation by reason of the fact that such person was a director, officer, employee or agent of such corporation, or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit provided such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation’s best interests except that no indemnification is permitted without judicial approval if the officer or director is adjudged to be liable to the corporation. Where an officer or director is successful on the merits or otherwise in the defense of any action referred to above, the corporation must indemnify him or her against the expenses that such officer or director has actually and reasonably incurred. Our third amended and restated certificate of incorporation and our amended and restated bylaws, each of which will become effective upon the closing of this offering, provide for the indemnification of our directors and officers to the fullest extent permitted under the Delaware General Corporation Law.

II-1

Section 102(b)(7) of the Delaware General Corporation Law permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duties as a director, except for liability for any:

• transaction from which the director derives an improper personal benefit;

• act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

• unlawful payment of dividends or redemption of shares; or

• breach of a director’s duty of loyalty to the corporation or its stockholders.

Our amended and restated certificate of incorporation and amended and restated bylaws include such a provision. Expenses incurred by any officer or director in defending any such action, suit or proceeding in advance of its final disposition shall be paid by us upon delivery to us of an undertaking, by or on behalf of such director or officer, to repay all amounts so advanced if it shall ultimately be determined that such director or officer is not entitled to be indemnified by us.

Section 174 of the Delaware General Corporation Law provides, among other things, that a director who willfully or negligently approves of an unlawful payment of dividends or an unlawful stock purchase or redemption may be held liable for such actions. A director who was either absent when the unlawful actions were approved, or dissented at the time, may avoid liability by causing his or her dissent to such actions to be entered in the books containing minutes of the meetings of the board of directors at the time such action occurred or immediately after such absent director receives notice of the unlawful acts.

As permitted by the Delaware General Corporation Law, we have entered into indemnity agreements with each of our directors and executive officers, that require us to indemnify such persons against any and all expenses (including attorneys’ fees), witness fees, damages, judgments, fines, settlements and other amounts incurred (including expenses of a derivative action) in connection with any action, suit or proceeding, whether actual or threatened, to which any such person may be made a party by reason of the fact that such person is or was a director, an officer or an employee of our company or any of our affiliated enterprises, provided that such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to our best interests and, with respect to any criminal proceeding, had no reasonable cause to believe his or her conduct was unlawful. The indemnification agreements also set forth certain procedures that will apply in the event of a claim for indemnification thereunder.

At present, there is no pending litigation or proceeding involving any of our directors or officers as to which indemnification is required or permitted, and we are not aware of any threatened litigation or proceeding that may result in a claim for indemnification.

We have an insurance policy covering our officers and directors with respect to certain liabilities, including liabilities arising under the Securities Act or otherwise.

We plan to enter into an underwriting agreement that provides that the underwriters are obligated, under some circumstances, to indemnify our directors, officers and controlling persons against specified liabilities, including liabilities under the Securities Act.

Item 15. Recent Sales of Unregistered Securities.

The following list sets forth information regarding all unregistered securities sold by us from January 1, 2004 through December 1, 2007.

(1) From January 1, 2004 through September 30, 2007, we granted options under our 2000 Stock Option/Stock Issuance Plan to purchase 39,172,891 shares of common stock to employees and directors, having exercise prices ranging from $0.25 to $0.65 per share. Of these, options to purchase 3,973,859 shares of common stock have been exercised for aggregate consideration of $1,008,967.07, of which we

II-2

repurchased 168,936 shares of common stock at an aggregate repurchase price of $29,530.65. As of September 30, 2007, we have cancelled options to purchase 4,942,754 shares of common stock.

(2) On February 5, 2004, we issued and sold an aggregate of 21,310,254 shares of Series D' Preferred Stock and warrants to purchase up to 3,196,532 shares of Series D' Preferred Stock, at an exercise price of $0.9007 per share, to a total of 17 accredited investors for an aggregate consideration of $19,194,145.78.

(3) On February 23, 2004, we issued and sold 1,164,316 shares of Series D' Preferred Stock and warrants to purchase up to 174,647 shares of Series D' Preferred Stock, at an exercise price of $0.9007 per share, to one accredited investor for consideration of $1,048,699.42.

(4) On June 29, 2004, we issued and sold an aggregate of 8,111,025 shares of Series D' Preferred Stock and warrants to purchase up to 1,216,653 shares of Series D' Preferred Stock, at an exercise price of $0.9007 per share, to a total of four accredited investors for an aggregate consideration of $7,305,600.22.

(5) On July 7, 2004, we issued and sold an aggregate of 10,253,964 shares of Series D' Preferred Stock and warrants to purchase up to 1,538,097 shares of Series D' Preferred Stock, at an exercise price of $0.9007 per share, to a total of 12 accredited investors for an aggregate consideration of $9,235,745.37.

(6) On September 24, 2004, we issued a warrant to purchase up to 6,588 shares of Series D Preferred Stock, at an exercise price of $0.9007 per share, to one accredited investor in connection with the drawdown of borrowed funds under a credit facility.

(7) On November 9, 2005, we issued and sold an aggregate of 22,204,950 shares of Series D' Preferred Stock and warrants to purchase up to 3,330,742 shares of Series D' Preferred Stock, at an exercise price of $0.9007 per share, to a total of two accredited investors for aggregate consideration of $19,999,998.47.

(8) On November 9, 2005, we issued a warrant to purchase up to 1,539,914 shares of Series D' Preferred Stock, at an exercise price of $0.9007 per share, to one accredited investor in connection with a strategic partnership.

(9) On September 20, 2006, we issued a warrant to purchase up to 3,849,783 shares of Series D' Preferred Stock, at an exercise price of $0.9007 per share, to one accredited investor in connection with a strategic partnership.

(10) On October 2, 2006, we issued and sold 8,580,009 shares of Series E Preferred Stock to one accredited investor for consideration of $10,000,000.49.

(11) On October 16, 2006, we issued a warrant to purchase up to 128,700 shares of Series E Preferred Stock, at an exercise price of $1.1655 per share, to one accredited investor in connection with a credit facility.

(12) On October 31, 2006, we issued and sold 257,400 shares of Series E Preferred Stock to one accredited investor for consideration of $299,999.70.

(13) On October 12, 2007, we issued a warrant to purchase up to 326,040 shares of Series E Preferred Stock, at an exercise price of $1.1655 per share, to one accredited investor in connection with a credit facility.

The offers, sales and issuances of the securities described in Item 15(1) were exempt from registration under the Securities Act under Rule 701 in that the transactions were under compensatory benefit plans and contracts relating to compensation as provided under Rule 701. The recipients of such securities were our employees or directors and received the securities under our 2000 Stock Option/Stock Issuance Plan. Appropriate legends were affixed to the securities issued in these transactions. Each of the recipients of securities in these transactions had adequate access, through employment or business relationships, to information about us.

The offers, sales, and issuances of the securities described in Items 15(2) through 15(13) were exempt from registration under the Securities Act under Section 4(2) of the Securities Act and Regulation D promulgated thereunder as transactions by an issuer not involving a public offering. The recipients of securities in each of these transactions acquired the securities for investment only and not with a view to or for sale in connection with any distribution thereof and appropriate legends were affixed to the securities issued in these transactions. Each of the recipients of securities in these transactions was an accredited or sophisticated person and had adequate access, through employment, business or other relationships, to information about us.

II-3

Item 16. Exhibits and Financial Statement Schedules.

(a) Exhibits.

Exhibit Number	Description of Document
1.1†	Form of Underwriting Agreement.
3.1	Amended and Restated Certificate of Incorporation of the Registrant, currently in effect.
3.2†	Form of Amended and Restated Certificate of Incorporation of the Registrant to be effective upon the closing of this offering.
3.3	Bylaws of the Registrant, currently in effect.
3.4†	Form of Amended and Restated Bylaws of the Registrant to be effective upon the closing of this offering.
4.1	Reference is made to Exhibits 3.1 through 3.4.
4.2†	Specimen Common Stock Certificate of the Registrant.
4.3	Amended and Restated Investors’ Rights Agreement, dated as of December 10, 2007, by and between the Registrant and the other parties named therein.
4.4	Series B-1 Preferred Stock Warrant of the Registrant issued to Heller Financial Leasing, Inc., a GE Company, dated as of January 25, 2002.
4.5	Form of Series D Preferred Stock Warrant of the Registrant.
4.6	Series D Preferred Stock Warrant of the Registrant issued to Heller Financial Leasing, Inc., a GE Company, dated as of December 4, 2003.
4.7	Series D Preferred Stock Warrant of the Registrant issued to Heller Financial Leasing, Inc., a GE Company, dated as of September 24, 2004.
4.8	Form of Series D’ Preferred Stock Warrant of the Registrant.
4.9†	Series D’ Warrant of the Registrant issued to Motorola, Inc., dated as of September 20, 2006.
4.10	Series E Preferred Stock Warrant of the Registrant issued to Atel Ventures, Inc., dated as of October 16, 2006.
4.11	Series E Preferred Stock Warrant of the Registrant issued to Silicon Valley Bank, dated as of October 12, 2007.
5.1†	Opinion of Cooley Godward Kronish LLP.
10.1+†	Form of Indemnification Agreement between the Registrant and its officers and directors.
10.2+	Executive Employment Agreement, dated as of June 13, 2007, by and between the Registrant and Henry R. Nothhaft.
10.3+	Severance Agreement, dated as of July 23, 2001, by the Registrant to Joe F. Britt, Jr.
10.4+	Severance Agreement, dated as of July 23, 2001, by the Registrant to Matthew Hershenson.
10.5+	Offer Letter, dated as of June 27, 2002, by the Registrant to Nancy J. Hilker.
10.6+	Offer Letter, dated as of October 23, 2002, by the Registrant to James L. Isaacs.
10.7+	Offer Letter, dated as of December 5, 2002, by the Registrant to Leslie Hamilton.
10.8+	Offer Letter, dated as of August 19, 2003, by the Registrant to Mark W. Fisher.

II-4

Exhibit Number	Description of Document
10.9+	Offer Letter, dated as of January 3, 2005, by the Registrant to Donn Dobkin.
10.10+†	2007 US Sales Commission Incentive Plan and Form of 2007 US Sales Incentive Agreement.
10.11†	Non-Employee Director Compensation Arrangements.
10.12+	Restricted Stock Agreement, dated as of September 22, 2000, by and between the Registrant and Matthew J. Hershenson, as amended.
10.13+	Restricted Stock Agreement, dated as of September 22, 2000, by and between the Registrant and Joe F. Britt, Jr., as amended.
10.14+	2000 Stock Option/Stock Issuance Plan, as amended.
10.15+	Form of Stock Option Agreement and Form of Option Grant Notice under the 2000 Stock Option/Stock Issuance Plan.
10.16+†	2008 Equity Incentive Plan.
10.17+†	Form of Option Agreement and Form of Option Grant Notice under the 2008 Equity Incentive Plan.
10.18+†	2008 Employee Stock Purchase Plan.
10.19+†	Form of 2008 Employee Stock Purchase Plan Offering Document.
10.20#	Master Manufacturing and Distribution Agreement, dated as of April 28, 2004, by and between the Registrant and Sharp Corporation.
10.21#	Master Services Agreement, dated as of June 1, 2005, by and between the Registrant and T-Mobile USA, Inc., as amended.
10.22#	Master Software License, Product Development and Distribution Agreement, dated as of September 20, 2006, by and between the Registrant and Motorola, Inc., as amended.
10.23	Lease, dated as of March 14, 2006, by and between the Registrant and Park Place Associates.
10.24	Lease, dated as of April 1, 2006, by and between the Registrant and Parmenter GCC LP, LLLP.
10.25	Lease Agreement, dated as of October 1, 2006, as amended by and between the Registrant and El Camino Center.
10.26	Lease, dated as of January 23, 2007, by and between the Registrant and Billtech Equity Partners, LLC.
10.27#	MCI Service Agreement, originally dated as of October 14, 2004, by and between the Registrant and Verizon Business Network Services, Inc. (previously MCI WORLDCOM Communications, Inc.), as amended through February 28, 2007.
10.28	Turn Key Datacenter Lease Agreement, dated as of October 25, 2007, by and between the Registrant and Digital Phoenix Van Buren, LLC.
10.29	License for Use of Asmec Facilities, dated as of July 5, 2006, by and between the Registrant and Asmec Management Associates Ltd.
10.30	Loan and Security Agreement, dated as of October 12, 2007, by and between the Registrant and Silicon Valley Bank.
21.1	Subsidiaries of the Registrant.
23.1	Consent of Independent Registered Public Accounting Firm.
23.2†	Consent of Cooley Godward Kronish LLP (included in Exhibit 5.1).
24.1	Power of Attorney (see page II-7 to this Registration Statement on Form S-1).

II-5

† To be filed by amendment.

+ Indicates management contract or compensatory plan.

# Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission.

(b) Financial Statement Schedules.

No financial statement schedules are provided because the information called for is not required or is shown either in the financial statements or the notes thereto.

Item 17. Undertakings.

The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act, 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, 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-6

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on the 19th day of December, 2007.

	DANGER, INC.
By:	/s/ Henry R. Nothhaft
	Henry R. Nothhaft
	Chief Executive Officer and Chairman of the Board of Directors

KNOW ALL BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Henry R. Nothhaft, Nancy J. Hilker and Scott L. Darling, and each of them, as his or her true and lawful attorneys-in-fact and agents, each with the full power of substitution, for him or her and in his or her name, place or stead, in any and all capacities, to sign any and all amendments to this Registration Statement (including post-effective amendments), and to sign any registration statement for the same offering covered by this Registration Statement that is to be effective upon filing pursuant to Rule 462(b) promulgated under the Securities Act, and all post-effective amendments thereto, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their, his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Henry R. Nothhaft Henry R. Nothhaft	Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer)	December 19, 2007
/s/ Nancy J. Hilker Nancy J. Hilker	Senior Vice President and Chief Financial Officer (Principal Financial Officer)	December 19, 2007
/s/ Sandra J. Taylor Sandra J. Taylor	Vice President of Finance, Controller and Chief Accounting Officer (Principal Accounting Officer)	December 19, 2007
/s/ Joe F. Britt, Jr. Joe F. Britt, Jr.	Director	December 19, 2007
/s/ Jeffrey D. Brody Jeffrey D. Brody	Director	December 19, 2007
/s/ Gregory P. Galanos Gregory P. Galanos	Director	December 19, 2007

II-7

Signature	Title	Date
/s/ Richard S. Gilbert Richard S. Gilbert	Director	December 19, 2007
/s/ Eric Hippeau Eric Hippeau	Director	December 19, 2007
/s/ Albert A. “Rocky” Pimentel Albert A. “Rocky” Pimentel	Director	December 19, 2007

II-8

EXHIBIT INDEX

Exhibit Number	Description of Document
1.1†	Form of Underwriting Agreement.
3.1	Amended and Restated Certificate of Incorporation of the Registrant, currently in effect.
3.2†	Form of Amended and Restated Certificate of Incorporation of the Registrant to be effective upon the closing of this offering.
3.3	Bylaws of the Registrant, currently in effect.
3.4†	Form of Amended and Restated Bylaws of the Registrant to be effective upon the closing of this offering.
4.1	Reference is made to Exhibits 3.1 through 3.4.
4.2†	Specimen Common Stock Certificate of the Registrant.
4.3	Amended and Restated Investors’ Rights Agreement, dated as of December 10, 2007, by and between the Registrant and the other parties named therein.
4.4	Series B-1 Preferred Stock Warrant of the Registrant issued to Heller Financial Leasing, Inc., a GE Company, dated as of January 25, 2002.
4.5	Form of Series D Preferred Stock Warrant of the Registrant.
4.6	Series D Preferred Stock Warrant of the Registrant issued to Heller Financial Leasing, Inc., a GE Company, dated as of December 4, 2003.
4.7	Series D Preferred Stock Warrant of the Registrant issued to Heller Financial Leasing, Inc., a GE Company, dated as of September 24, 2004.
4.8	Form of Series D’ Preferred Stock Warrant of the Registrant.
4.9†	Series D’ Warrant of the Registrant issued to Motorola, Inc., dated as of September 20, 2006.
4.10	Series E Preferred Stock Warrant of the Registrant issued to Atel Ventures, Inc., dated as of October 16, 2006.
4.11	Series E Preferred Stock Warrant of the Registrant issued to Silicon Valley Bank, dated as of October 12, 2007.
5.1†	Opinion of Cooley Godward Kronish LLP.
10.1+†	Form of Indemnification Agreement between the Registrant and its officers and directors.
10.2+	Executive Employment Agreement, dated as of June 13, 2007, by and between the Registrant and Henry R. Nothhaft.
10.3+	Severance Agreement, dated as of July 23, 2001, by the Registrant to Joe F. Britt, Jr.
10.4+	Severance Agreement, dated as of July 23, 2001, by the Registrant to Matthew Hershenson.
10.5+	Offer Letter, dated as of June 27, 2002, by the Registrant to Nancy J. Hilker.
10.6+	Offer Letter, dated as of October 23, 2002, by the Registrant to James L. Isaacs.
10.7+	Offer Letter, dated as of December 5, 2002, by the Registrant to Leslie Hamilton.
10.8+	Offer Letter, dated as of August 19, 2003, by the Registrant to Mark W. Fisher.
10.9+	Offer Letter, dated as of January 3, 2005, by the Registrant to Donn Dobkin.
10.10+†	2007 US Sales Commission Incentive Plan and Form of 2007 US Sales Incentive Agreement.
10.11†	Non-Employee Director Compensation Arrangements.

Exhibit Number	Description of Document
10.12+	Restricted Stock Agreement, dated as of September 22, 2000, by and between the Registrant and Matthew J. Hershenson, as amended.
10.13+	Restricted Stock Agreement, dated as of September 22, 2000, by and between the Registrant and Joe F. Britt, Jr., as amended
10.14+	2000 Stock Option/Stock Issuance Plan, as amended.
10.15+	Form of Stock Option Agreement and Form of Option Grant Notice under the 2000 Stock Option/Stock Issuance Plan.
10.16+†	2008 Equity Incentive Plan.
10.17+†	Form of Option Agreement and Form of Option Grant Notice under the 2008 Equity Incentive Plan.
10.18+†	2008 Employee Stock Purchase Plan.
10.19+†	Form of 2008 Employee Stock Purchase Plan Offering Document.
10.20#	Master Manufacturing and Distribution Agreement, dated as of April 28, 2004, by and between the Registrant and Sharp Corporation.
10.21#	Master Services Agreement, dated as of June 1, 2005, by and between the Registrant and T-Mobile USA, Inc., as amended.
10.22#	Master Software License, Product Development and Distribution Agreement, dated as of September 20, 2006, by and between the Registrant and Motorola, Inc., as amended.
10.23	Lease, dated as of March 14, 2006, by and between the Registrant and Park Place Associates.
10.24	Lease, dated as of April 1, 2006, by and between the Registrant and Parmenter GCC LP, LLLP.
10.25	Lease Agreement, dated as of October 1, 2006, as amended by and between the Registrant and El Camino Center.
10.26	Lease, dated as of January 23, 2007, by and between the Registrant and Billtech Equity Partners, LLC.
10.27#	MCI Service Agreement, originally dated as of October 14, 2004, by and between the Registrant and Verizon Business Network Services, Inc. (previously MCI WORLDCOM Communications, Inc.), as amended through February 28, 2007.
10.28	Turn Key Datacenter Lease Agreement, dated as of October 25, 2007, by and between the Registrant and Digital Phoenix Van Buren, LLC.
10.29	License for Use of Asmec Facilities, dated as of July 5, 2006, by and between the Registrant and Asmec Management Associates Ltd.
10.30	Loan and Security Agreement, dated as of October 12, 2007, by and between the Registrant and Silicon Valley Bank.
21.1	Subsidiaries of the Registrant.
23.1	Consent of Independent Registered Public Accounting Firm.
23.2†	Consent of Cooley Godward Kronish LLP (included in Exhibit 5.1).
24.1	Power of Attorney (see page II-7 to this Registration Statement on Form S-1).

† To be filed by amendment.

+ Indicates management contract or compensatory plan.

# Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission.

EX-3.1

EXHIBIT 3.1

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

OF

DANGER, INC.

Danger, Inc., a corporation organized and existing under the General Corporation Law of the State of Delaware DOES HEREBY CERTIFY:

FIRST: The Corporation’s original Certificate of Incorporation was filed with the Secretary of State of Delaware on December 15, 1999, under the name Danger Research, Inc.

SECOND: The Amended and Restated Certificate of Incorporation of Danger, Inc. in the form attached hereto as Exhibit A has been duly adopted in accordance with the provisions of Sections 245 and 242 of the General Corporation Law of the State of Delaware by the directors and stockholders of the Corporation.

THIRD: The certificate of incorporation is hereby amended and restated to read in full as set forth in Exhibit A attached hereto and such Exhibit is hereby incorporated herein by this reference.

IN WITNESS WHEREOF, Danger, Inc. has caused this Certificate to be signed by its Chairman and Chief Executive Officer this 27^th day of September, 2006.

DANGER, INC.
By:	/s/ Henry R. Nothhaft
	Henry R. Nothhaft, Chairman and Chief Executive Officer

1

EXHIBIT A

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

OF

DANGER, INC.,

a Delaware corporation

ARTICLE I

The name of the Corporation is Danger, Inc.

ARTICLE II

The address of the registered office of the Corporation in the State of Delaware is 2711 Centerville Road, Suite 400, in the city of Wilmington and the County of New Castle and the name of the registered agent at that address is the Corporation Service Company.

ARTICLE III

The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware.

ARTICLE IV

A. Classes of Stock. This Corporation is authorized to issue two classes of shares to be designated respectively Preferred Stock (the “Preferred Stock”) and Common Stock (the “Common Stock”). The total number of shares of capital stock that the Corporation is authorized to issue is Four Hundred Thirty-Five Million Four Hundred Forty Thousand Five Hundred Sixty-Two (435,440,562). The total number of shares of Preferred Stock this Corporation shall have authority to issue is One Hundred Seventy-Five Million Four Hundred Forty Thousand Five Hundred Sixty-Two (175,440,562). The total number of shares of Common Stock this Corporation shall have authority to issue is Two Hundred Sixty Million (260,000,000). The Preferred Stock shall have a par value of $0.0001 per share, and the Common Stock shall have a par value of $0.0001 per share.

B. The Preferred Stock. The Preferred Stock shall be divided into series. The first series shall consist of Nine Million Nine Hundred Seven Thousand Four Hundred Seven (9,907,407) shares and is designated “Series A Preferred Stock.” The second series shall consist of Twelve Million Three Hundred Eighteen Thousand Four Hundred Forty-Four (12,318,444) shares and is designated “Series B-1 Preferred Stock.” The third series shall consist of Sixteen Million Two Hundred Seventy-One Thousand Four Hundred Fifty-Three (16,271,453) shares and is designated “Series C Preferred Stock.” The fourth series shall consist of Forty-Five Million Seventy-Three Thousand Two Hundred Fifty-Eight (45,073,258) shares and is designated “Series D Preferred Stock.” The fifth series shall consist of Seventy-Nine Million (79,000,000) shares and is designated “Series D’ Preferred Stock.” The sixth series shall consist

Exhibit A – Page 1

of Twelve Million Eight Hundred Seventy Thousand (12,870,000) shares and is designated “Series E Preferred Stock.”

C. The powers, preferences, rights, restrictions, and other matters relating to the Series A Preferred Stock, Series B-1 Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, Series D’ Preferred Stock and Series E Preferred Stock (the “Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock”) are as follows:

1. Dividends.

a. The holders of the Series D Preferred Stock and Series D’ Preferred Stock shall be entitled to receive on a pro-rata basis (i) the Series D and Series D’ Cumulative Dividend (as defined in Section B.2.a(ii) below), which dividend shall be cumulative in the event of a Liquidation Event, and (ii) dividends at the rate of $0.0721 per share (as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such shares) per annum, respectively, payable out of funds legally available therefor, prior and in preference to the payment of any dividend (other than those payable solely in Preferred or Common Stock) on any Series A, Series B-1, Series C or Series E Preferred Stock or Common Stock. The dividend specified in this Section B.1.a(ii) shall be payable only when, as and if declared by the Board of Directors and shall be cumulative. No dividend will be paid on any class or series of stock unless dividends at the rate of $0.0721 per share are first paid on each outstanding share of Series D Preferred Stock and Series D’ Preferred Stock.

b. The holders of the Series A, Series B-1, Series C and Series E Preferred Stock shall be entitled to receive dividends at the rate of $0.086, $0.1168, $0.0990 and $0.0932 per share (as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such shares) per annum, respectively, payable out of funds legally available therefor, prior and in preference to the payment of any dividend (other than those payable solely in Common Stock) on any Common Stock. Such dividends shall be payable only when, as and if declared by the Board and shall be non-cumulative.

c. After dividends in the full preferential amount specified in subsections (a) and (b) of this Section B.1 have been paid or declared and set apart in full in any fiscal year of the Corporation, and if the Board shall declare additional dividends out of funds legally available therefor in that fiscal year, then such additional dividends shall be declared pro rata on the Common Stock and the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock on a pari passu basis according to the number of shares of Common Stock held by such holders, where each holder of shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock is to be treated for this purpose as holding the greatest whole number of shares of Common Stock then issuable upon conversion of all shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock held by such holder pursuant to Section B.5 hereof.

d. If the Corporation shall declare a distribution payable in securities of other persons, evidences of indebtedness issued by the Corporation or other persons, assets (excluding cash dividends) or options or rights to purchase any such securities or evidences of indebtedness, then, in each such case the holders of the Series A, Series B-1, Series C, Series D, Series D’ and

Exhibit A – Page 2

Series E Preferred Stock shall be entitled to a proportionate share of any such distribution as though the holders of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock were the holders of the number of shares of Common Stock of the Corporation into which their respective shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock are convertible as of the record date fixed for the determination of the holders of Common Stock of the Corporation entitled to receive such distribution.

e. California Code Sections 502 and 503 shall not apply with respect to distributions on shares junior to the Series Preferred as they relate to repurchases of shares of Common Stock upon termination of employment or service as a consultant or director.

2. Liquidation Preference.

a. In the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary (a “Liquidation Event”), the holders of the Series D Preferred Stock and Series D’ Preferred Stock shall be entitled to receive on a pro-rata basis, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to any other class or series of stock by reason of their ownership thereof, the Applicable Series D and Series D’ Liquidation Preference (as defined below), respectively, plus the Series D and Series D’ Cumulative Dividend, respectively, whether or not declared, plus any accrued but unpaid dividend pursuant to Section B.1.a(ii) above, on each share of Series D Preferred Stock and Series D’ Preferred Stock held by them. If upon the occurrence of a Liquidation Event, the assets and funds thus distributed shall be insufficient to permit the payment to such holders of the full aforesaid preferential amount, then the entire assets and funds of the Corporation legally available for distribution shall be distributed ratably among the holders of the Series D Preferred Stock and Series D’ Preferred Stock in proportion to the preferential amount each such holder is otherwise entitled to receive.

(i) The “Applicable Series D and Series D’ Liquidation Preference” shall be (A) $1.3511 per share of Series D Preferred Stock or Series D’ Preferred Stock (in each case as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such shares) in the event that the aggregate value of the Corporation in the Liquidation Event is $250,000,000 or less; or (B) $0.9007 per share of Series D Preferred Stock or Series D’ Preferred Stock (in each case as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such shares) in the event that the aggregate value of the Corporation in the Liquidation Event is greater than $250,000,000 (a “Qualified Liquidation”).

(ii) The “Series D and Series D’ Cumulative Dividend” shall be (A) $0.0721 per share of Series D Preferred Stock or Series D’ Preferred Stock per annum (in each case as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such shares), cumulative from the date on which a share of Series D Preferred Stock or Series D’ Preferred Stock was first issued, as applicable (the “Series D Original Issue Date” and “Series D’ Original Issue Date,” respectively), in the event that the Liquidation Event is not a Qualified Liquidation; (B) $0.045 per share of Series D Preferred Stock or Series D’ Preferred Stock per annum (in each case as adjusted

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for any stock dividends, combinations, splits, recapitalizations and the like with respect to such shares), cumulative from the Series D Original Issue Date or Series D’ Original Issue Date, as applicable, in the event that the Liquidation Event is a Qualified Liquidation but the aggregate value of the Corporation in such Liquidation Event does not exceed $500,000,000 or (C) zero in the event that the Liquidation Event is a Qualified Liquidation but the aggregate value of the Corporation in such Liquidation Event is greater than $500,000,000. The Series D and Series D’ Cumulative Dividend will be computed on a simple basis (no compounding) and shall be pro-rated for any portion of a year.

(iii) Notwithstanding the foregoing, if the amount that the holders of Series D Preferred Stock and Series D’ Preferred Stock would be entitled to receive upon a Qualified Liquidation pursuant to Section 2.a is less than the amount such holders would have been entitled to receive in accordance with Section 2.a had such Liquidation Event not have been a Qualified Liquidation, then the Applicable Series D and Series D’ Liquidation Preference and the Series D and Series D’ Cumulative Dividend shall be calculated in accordance with Section 2.a as if a non-Qualified Liquidation Event had occurred at a valuation of $250,000,000, even though the Liquidation Event is a Qualified Liquidation.

b. In the event of any Liquidation Event, and after full payment of the amounts set forth in Section 2.a above, the holders of the Series A, Series B-1, Series C and Series E Preferred Stock shall be entitled to receive, on a pari passu basis, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of the Common Stock by reason of their ownership thereof, the amount of $1.08, $1.4596, $1.2371 and $1.1655 per share, respectively (as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such shares), plus all accrued and unpaid dividends on each such share of Series A, Series B-1, Series C and Series E Preferred Stock then held by them. If upon the occurrence of such Liquidation Event, the assets and funds thus distributed among the holders of the Series A, Series B-1, Series C and Series E Preferred Stock shall be insufficient to permit the payment to such holders of the full aforesaid preferential amount, then the entire remaining assets and funds of the Corporation legally available for distribution after payment of the Applicable Series D and Series D’ Liquidation Preference shall be distributed ratably among the holders of the Series A, Series B-1, Series C and Series E Preferred Stock in proportion to the preferential amount each such holder is otherwise entitled to receive.

c. Upon the completion of the distribution required by subsections (a) and (b) of this Section B.2, any remaining assets of the Corporation available for distribution shall be distributed among the holders of shares of Series D Preferred Stock, Series D’ Preferred Stock and Common Stock, pro rata based on the number of shares of Common Stock held by each such holder (on an as converted basis).

d. For purposes of this Section B.2, (i) any acquisition of the Corporation by means of merger or other form of corporate reorganization in which outstanding shares of the Corporation are exchanged for securities or other consideration issued, or caused to be issued, by

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the acquiring corporation or its subsidiary (other than a mere reincorporation transaction) and pursuant to which the holders of the outstanding voting securities of the Corporation immediately prior to such consolidation, merger or other transaction fail to hold equity securities representing a majority of the voting power of the Corporation or surviving entity immediately following such consolidation, merger or other transaction (excluding voting securities of the acquiring corporation held by such holders prior to such transaction), (ii) the sale or transfer by the Corporation, in a single transaction or series of related transactions, of securities representing a majority of the voting power of the Corporation or (iii) a sale or transfer in a single transaction or a series of related transactions of all or substantially all of the assets of the Corporation shall be treated as a Liquidation Event and shall entitle the holders of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock to receive at the closing of any such transactions in cash, securities or other property (valued as provided in Section B.2(e) and (f) below) amounts as specified in Section B.2(a).

e. Whenever the distribution provided for in this Section B.2 shall be payable in securities or property other than cash, the value of such distribution shall be the fair market value of such securities or other property as determined in good faith by the Board of Directors.

f. Any securities shall be valued as follows:

(i) Securities not subject to investment letter or other similar restrictions on free marketability covered by (ii) below:

(1) If traded on a securities exchange or through the Nasdaq National Market, the value shall be deemed to be the average of the closing prices of the securities on such quotation system over the thirty (30) day period ending three (3) days prior to the closing;

(2) If actively traded over-the-counter, the value shall be deemed to be the average of the closing bid or sale prices (whichever is applicable) over the thirty (30) day period ending three (3) days prior to the closing; and

(3) If there is no active public market, the value shall be the fair market value thereof, as determined by the Board of Directors.

(ii) The method of valuation of securities subject to investment letter or other restrictions on free marketability (other than restrictions arising solely by virtue of a shareholder’s status as an affiliate or former affiliate) shall be to make an appropriate discount from the market value determined as above in (i) (1), (2) or (3) to reflect the approximate fair market value thereof, as determined by the Board of Directors.

3. Redemption.

a. The holders of at least a majority of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock, voting together as a class, may require the Corporation to redeem all, or if less than all, a specified number of such holders’ shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock, in three (3)

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annual installments beginning any time after the fifth anniversary of the date on which a share of Series D Preferred Stock was first issued and ending on the earlier of (i) the date two (2) years following such fifth anniversary and (ii) the date a Qualified IPO (as defined below) is consummated. Each date on which an installment is required to be paid in redemption of such Series A Preferred Stock, Series B-1 Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, Series D’ Preferred Stock and Series E Preferred Stock is referred to as a “Redemption Date.” Notice of a vote to redeem such shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock shall be sent to the Corporation at least ninety (90) days prior to the initial Redemption Date. One third (1/3) of the outstanding shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock that have been requested to be redeemed pursuant to this Section B.3(a) shall be redeemed upon the initial Redemption Date and one third (1/3) of the outstanding shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock that have been requested to be redeemed pursuant to this Section B.3(a) shall be redeemed at each of the second and third Redemption Dates. The Corporation shall effect such redemptions by paying in cash in exchange for the shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock to be redeemed a total of (i) an amount equal to $1.08, $1.4596, $1.2371, $0.9007, $0.9007 or $1.1655 per share of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock, respectively, (as adjusted for any stock dividends, combinations or splits with respect to such shares) plus (ii) an amount equal to $0.086, $0.1168, $0.0990, $0.0721, $0.0721 and $0.0932 per share of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock (as adjusted for any stock dividends, combinations or splits with respect to each series) per annum from the date on which such share was first issued (as applicable, the “Series A Redemption Price,” the “Series B-1 Redemption Price,” the “Series C Redemption Price,” the “Series D Redemption Price,” the “Series D’ Redemption Price” and the “Series E Redemption Price”). Any redemption effected pursuant to this Section B.3(a) shall be made on a pro-rata basis among the holders of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock that have requested to be redeemed in proportion to the shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock then held by them.

b. As used herein and in Sections B.3(c) and B.3(d) below, the term “Redemption Price” shall refer to each of the “Series A Redemption Price,” the “Series B-1 Redemption Price,” the “Series C Redemption Price,” the “Series D Redemption Price,” the “Series D’ Redemption Price” or the “Series E Redemption Price” as applicable. At least 30 but no more than 60 days prior to each Redemption Date, written notice shall be mailed, first class postage prepaid, to each holder of record (at the close of business on the business day next preceding the day on which notice is given) of the Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock electing to be redeemed, at the address last shown on the records of the Corporation for such holder, notifying such holder of the redemption, specifying the number of shares which may be redeemed from such holder, the Redemption Date, the Redemption Price, the place at which payment may be obtained and informing such holder of the procedures for surrendering to the Corporation, in the manner and at the place designated, his certificate or certificates representing the shares to be redeemed (the “Redemption Notice”). Except as provided in Section B.3(c), on or after the Redemption Date, each holder of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock to be redeemed shall surrender to this Corporation the certificate or certificates representing such shares, in the

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manner and at the place designated in the Redemption Notice, and thereupon the Redemption Price of such shares shall be payable to the order of the person whose name appears on such certificate or certificates as the owner thereof and each surrendered certificate shall be cancelled. In the event less than all the shares represented by any such certificate are redeemed, a new certificate shall be issued representing the unredeemed shares.

c. From each Redemption Date, unless there shall have been a default in payment of the Redemption Price, all rights of the holders of shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock designated for redemption in the Redemption Notice as holders of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock, as applicable (except the right to receive the Redemption Price without interest upon surrender of their certificate or certificates), shall cease with respect to such shares, and such shares shall not thereafter be transferred on the books of this Corporation or be deemed to be outstanding for any purpose whatsoever. Subject to the rights of series of Preferred Stock which may from time to time come into existence, if the funds of the Corporation legally available for redemption of shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock on any Redemption Date are insufficient to redeem the total number of shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock to be redeemed on such date, those funds which are legally available will be used to redeem the maximum possible number of such shares ratably among the holders of such shares to be redeemed based upon their holdings of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock, provided, however, that no shares of Series A, Series B-1, Series C or Series E Preferred Stock shall be redeemed until the full Series D Redemption Price and Series D’ Redemption Price have been paid on each share of Series D Preferred Stock and Series D’ Preferred Stock so redeemed. If the assets and legally available funds of the Corporation are insufficient to permit the payment of the full Series D Redemption Price and Series D’ Redemption Price on each share of Series D Preferred Stock and Series D’ Preferred Stock that have been redeemed, then the entire assets and funds of the Corporation legally available for distribution shall be distributed ratably among the holders of the redeemed Series D Preferred Stock and Series D’ Preferred Stock in proportion to the preferential amount each such holder is otherwise entitled to receive. The shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock not redeemed shall remain outstanding and entitled to all the rights and preferences provided herein. Subject to the rights of series of Preferred Stock which may from time to time come into existence, at any time thereafter when additional funds of the Corporation are legally available for the redemption of shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock, such funds will immediately be used to redeem the balance of the shares which the Corporation has become obliged to redeem on any Redemption Date but which it has not redeemed.

d. On or prior to the date on which the Redemption Price is to be paid, the Corporation shall deposit the Redemption Price of all shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock designated for redemption in the Redemption Notice and not yet redeemed with a bank or trust corporation having aggregate capital and surplus in excess of $100,000,000 as a trust fund for the benefit of the respective holders of the shares designated for redemption and not yet redeemed, with irrevocable instructions and authority to the bank or trust corporation to pay the Redemption Price for such shares to their

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respective holders on or after the Redemption Date upon receipt of notification from the Corporation that such holder has surrendered his share certificate to the Corporation pursuant to Section B.3(b) above. As of the date of such deposit (even if prior to the Redemption Date), the deposit shall constitute full payment of the shares to their holders, and from and after the date of the deposit the shares so called for redemption shall be redeemed and shall be deemed to be no longer outstanding, and the holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust corporation payment of the Redemption Price of the shares, without interest, upon surrender of their certificates therefor, and the right to convert such shares as provided in Section B.5 hereof. Such instructions shall also provide that any moneys deposited by the Corporation pursuant to this Section B.3(d) for the redemption of shares thereafter converted into shares of the Corporation’s Common Stock pursuant to Section B.5 hereof prior to the Redemption Date shall be returned to the Corporation forthwith upon such conversion. The balance of any moneys deposited by the Corporation pursuant to this Section B.3(d) remaining unclaimed at the expiration of two (2) years following the Redemption Date shall thereafter be returned to the Corporation upon its request expressed in a resolution of its Board of Directors.

4. Voting Rights.

a. General Rights. Each holder of shares of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock shall be entitled to the number of votes equal to the number of shares of Common Stock into which such shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock could then be converted on the record date for the vote or consent of stockholders (or, if no record date is established, on the date such vote is taken or consent solicited) and shall have voting rights and powers equal to the voting rights and powers of the Common Stock (except as otherwise expressly provided herein or as required by law, voting together with the Common Stock as a single class) and shall be entitled to notice of any stockholders’ meeting in accordance with the Bylaws of the Corporation. Fractional votes shall not, however, be permitted and any fractional voting rights resulting from the above formula (after aggregating all shares into which shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock held by each holder could be converted) shall be rounded to the nearest whole number (with one-half being rounded upward).

b. Election of Directors. The Board of Directors shall consist of the number of members specified in the Company’s Bylaws. In addition to the voting rights set forth in paragraph 4(a) above, (i) the holders of Series A Preferred Stock, voting together as a separate class, shall be entitled to elect one (1) member of the Board of Directors, (ii) the holders of the Series B-1 Preferred Stock and Series C Preferred Stock, voting together as a single class, shall be entitled to elect two (2) members of the Board of Directors, (iii) the holders of the Series D Preferred Stock, voting together as a separate class, shall be entitled to elect one (1) member of the Board of Directors and (iv) the holders of the Common Stock, voting together as a single class, shall be entitled to elect two (2) members of the Board of Directors. In the event of a vacancy in the office of any director elected by the holders of any class, a successor shall be elected to hold office for the unexpired term of such director by the holders of shares of such separate class. The remaining directors shall be elected by the holders of the Common Stock and the Preferred Stock, voting together as a single class.

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c. No person entitled to vote at an election for directors may cumulate votes to which such person is entitled, unless, at the time of such election, the Company is subject to Section 2115 of the California General Corporation Law (“CGCL”). During such time or times that the Company is subject to Section 2115(b) of the CGCL, every stockholder entitled to vote at an election for directors may cumulate such stockholder’s votes and give one candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which such stockholder’s shares are otherwise entitled, or distribute the stockholder’s votes on the same principle among as many candidates as such stockholder desires. No stockholder, however, shall be entitled to so cumulate such stockholder’s votes unless (i) the names of such candidate or candidates have been placed in nomination prior to the voting and (ii) the stockholder has given notice at the meeting, prior to the voting, of such stockholder’s intention to cumulate such stockholder’s votes. If any stockholder has given proper notice to cumulate votes, all stockholders may cumulate their votes for any candidates who have been properly placed in nomination. Under cumulative voting, the candidates receiving the highest number of votes, up to the number of directors to be elected, are elected.

d. During such time or times that the Company is subject to Section 2115(b) of the CGCL, one or more directors may be removed from office at any time without cause by the affirmative vote of the holders of at least a majority of the outstanding shares entitled to vote for that director as provided above; provided, however, that unless the entire Board is removed, no individual director may be removed when the votes cast against such director’s removal, or not consenting in writing to such removal, would be sufficient to elect that director if voted cumulatively at an election which the same total number of votes were cast (or, if such action is taken by written consent, all shares entitled to vote were voted) and the entire number of directors authorized at the time of such director’s most recent election were then being elected.

5. Conversion. The holders of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock shall have conversion rights as follows (the “Conversion Rights”):

a. Right to Convert.

(i) Each share of Series A Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share and on or prior to the fifth day prior to the Redemption Date, if any, as may have been fixed in any Redemption Notice with respect to the Series A Preferred Stock, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $1.08 by the Series A Conversion Price applicable to such share, determined as hereinafter provided, in effect on the date the certificate is surrendered for conversion. The price at which shares of Common Stock shall be deliverable upon conversion of shares of the Series A Preferred Stock (the “Series A Conversion Price”) shall initially be $1.08 per share of Common Stock. Such initial Series A Conversion Price shall be adjusted as hereinafter provided.

(ii) Each share of Series B-1 Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share and

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on or prior to the fifth day prior to the Redemption Date, if any, as may have been fixed in any Redemption Notice with respect to the Series B-1 Preferred Stock, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $1.4596 by the Series B-1 Conversion Price applicable to such share, determined as hereinafter provided, in effect on the date the certificate is surrendered for conversion. The price at which shares of Common Stock shall be deliverable upon conversion of shares of the Series B-1 Preferred Stock (the “Series B-1 Conversion Price”) shall as of the date of the filing of this Certificate be $1.41393 per share of Common Stock. Such initial Series B-1 Conversion Price shall be adjusted as hereinafter provided.

(iii) Each share of Series C Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share and on or prior to the fifth day prior to the Redemption Date, if any, as may have been fixed in any Redemption Notice with respect to the Series C Preferred Stock, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $1.2371 by the Series C Conversion Price applicable to such share, determined as hereinafter provided, in effect on the date the certificate is surrendered for conversion. The price at which shares of Common Stock shall be deliverable upon conversion of shares of the Series C Preferred Stock (the “Series C Conversion Price”) shall initially be $1.2371 per share of Common Stock. Such initial Series C Conversion Price shall be adjusted as hereinafter provided.

(iv) Each share of Series D Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share and on or prior to the fifth day prior to the Redemption Date, if any, as may have been fixed in any Redemption Notice with respect to the Series D Preferred Stock, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $0.9007 by the Series D Conversion Price applicable to such share, determined as hereinafter provided, in effect on the date the certificate is surrendered for conversion. The price at which shares of Common Stock shall be deliverable upon conversion of shares of the Series D Preferred Stock (the “Series D Conversion Price”) shall initially be $0.9007 per share of Common Stock. Such initial Series D Conversion Price shall be adjusted as hereinafter provided.

(v) Each share of Series D’ Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share and on or prior to the fifth day prior to the Redemption Date, if any, as may have been fixed in any Redemption Notice with respect to the Series D’ Preferred Stock, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $0.9007 by the Series D’ Conversion Price applicable to such share, determined as hereinafter provided, in effect on the date the certificate is surrendered for conversion. The price at which shares of Common Stock shall be deliverable upon conversion of shares of the Series D’

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Preferred Stock (the “Series D’ Conversion Price”) shall initially be $0.6935 per share of Common Stock. Such initial Series D’ Conversion Price shall be adjusted as hereinafter provided.

(vi) Each share of Series E Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share and on or prior to the fifth day prior to the Redemption Date, if any, as may have been fixed in any Redemption Notice with respect to the Series E Preferred Stock, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $1.1655 by the Series E Conversion Price applicable to such share, determined as hereinafter provided, in effect on the date the certificate is surrendered for conversion. The price at which shares of Common Stock shall be deliverable upon conversion of shares of the Series E Preferred Stock (the “Series E Conversion Price”) shall initially be $1.1655 per share of Common Stock. Such initial Series E Conversion Price shall be adjusted as hereinafter provided.

b. Automatic Conversion. Each share of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock shall automatically be converted into shares of Common Stock at the then effective Series A Conversion Price, Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price or Series E Conversion Price, respectively, upon the earlier of (i) the date specified by written consent or agreement of holders of at least a majority of the shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock then outstanding, voting together as a single class, including the holders of at least sixty-six and two-thirds percent (66 2/3%) of the Series D and Series D’ Preferred Stock, voting together as a single class; or (ii) immediately upon the closing of the sale of the Corporation’s Common Stock in a firm commitment, underwritten public offering registered under the Securities Act of 1933, as amended (the “Securities Act”), at a per share price to the public that values the Corporation at not less than $373 million and in which the aggregate proceeds to the Corporation (before deduction for underwriters’ discounts and expenses relating to the issuance, including without limitation fees of the Corporation’s counsel) are at least $35,000,000 million (a “Qualified IPO”).

c. Mechanics of Conversion.

(i) Before any holder of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock shall be entitled to convert the same into shares of Common Stock, such holder shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Corporation or of any transfer agent for such stock, and shall give written notice to the Corporation at such office that he elects to convert the same and shall state therein the name or names in which he wishes the certificate or certificates for shares of Common Stock to be issued; provided, however, that in the event of an automatic conversion pursuant to Section B.5(b) above, the outstanding shares of Preferred Stock shall be converted automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Corporation or its transfer agent, and, provided, further, that the

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Corporation shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such automatic conversion unless the certificates evidencing such shares of Preferred Stock are either delivered to the Corporation or its transfer agent or the holder notifies the Corporation or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificates. The Corporation shall, as soon as practicable thereafter, issue and deliver at such office to such holder of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock, a certificate or certificates for the number of shares of Common Stock to which he shall be entitled as aforesaid and shall promptly pay in cash or, to the extent sufficient funds are not then legally available therefor, in Common Stock (at the Common Stock’s fair market value determined by the Board, as of the date of such conversion), any declared and unpaid dividends on the shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock being converted. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of surrender of the shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock to be converted, and the person or persons entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock on such date.

(ii) If the conversion is in connection with an underwritten offering of securities pursuant to the Securities Act, the conversion may, at the option of any holder tendering shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock for conversion, be conditioned upon the closing with the underwriters of the sale of securities pursuant to such offering, in which event the person(s) entitled to receive the Common Stock upon conversion of the Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock shall not be deemed to have converted such Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock until immediately prior to the closing of such sale of securities.

d. Adjustments to Series B-1, Series C, Series D, Series D’ and Series E Conversion Price for Certain Dilutive Issuances.

(i) Special Definitions. For purposes of this Section B.5(d), the following definitions apply:

(1) “Options” shall mean rights, options, or warrants to subscribe for, purchase or otherwise acquire either Common Stock or Convertible Securities (defined below).

(2) “Convertible Securities” shall mean any evidences of indebtedness, shares (other than Common Stock and Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock) or other securities convertible into or exchangeable for Common Stock.

(3) “Additional Shares of Common Stock” shall mean all shares of Common Stock issued (or, pursuant to Section B.5(d)(iii), deemed to be issued) by the

Exhibit A – Page 12

Corporation after the Series E Original Issue Date, other than shares of Common Stock issued or issuable:

(A) upon conversion of shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock;

(B) to officers, directors or employees of, or consultants to, the Corporation pursuant to stock option or stock purchase plans or agreements on terms approved by the Board of Directors, including at least one Board member appointed by the Series A, Series B-1, Series C or Series D Preferred Stock;

(C) as a dividend or distribution on Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock;

(D) for which adjustment of the Series A, Series B-1, Series C, Series D, Series D’ or Series E Conversion Price is made pursuant to Section B.5(e);

(E) to the public by the Corporation pursuant to a registration statement filed under the Securities Act;

(F) pursuant to the acquisition of another corporation or entity by the Corporation by consolidation, merger, purchase of all or substantially all of the assets or other reorganization in which the Corporation acquires, in a single transaction or series of related transactions, all or substantially all of the assets of such other corporation or entity, 50% or more of the voting power of such other corporation or entity, or 50% or more of the equity ownership of such other entity;

(G) to parties providing the Corporation with equipment leases, real property leases, loans, credit lines, guaranties of indebtedness, cash price reductions or similar financing or other strategic partners approved by the Board of Directors and not primarily for equity financing purposes, including at least one Board member appointed by the Series A, Series B-1, Series C or Series D Preferred Stock;

(H) pursuant to warrants for the purchase of Sixty-Eight Thousand Five Hundred Twelve (68,512) shares of Series B-1 Preferred Stock (the “Series B-1 Warrants”), the shares issuable upon exercise of the Series B-1 Warrants and the Common Stock issued upon conversion of such shares of Series B-1 Preferred Stock (whether such issuances occur prior or subsequent to the date hereof);

(I) pursuant to warrants for the purchase of Five Hundred Forty-Four Thousand Seven Hundred Ninety-Eight (544,798) shares of Series C Preferred Stock (the “Series C Warrants”), the shares issuable upon exercise of the Series C Warrants and the Common Stock issued upon conversion of such shares of Series C Preferred Stock (whether such issuances occur prior or subsequent to the date hereof);

(J) to parties purchasing up to Twelve Million Eight Hundred Seventy Thousand (12,870,000) shares of Series E Preferred Stock;

Exhibit A – Page 13

(K) pursuant to warrants for the purchase of Five Million Nine Hundred Ten Thousand Three Hundred Nineteen (5,910,319) shares of Series D Preferred Stock (the “Series D Warrants”), the shares issuable upon exercise of the Series D Warrants and the Common Stock issued upon conversion of such shares of Series D Preferred Stock (whether such issuances occur prior or subsequent to the date hereof); or

(L) pursuant to warrants for the purchase of Fourteen Million Eight Hundred Forty-Six Thousand Three Hundred Sixty-Eight (14,846,368) shares of Series D’ Preferred Stock (the “Series D’ Warrants”), the shares issuable upon exercise of the Series D’ Warrants and the Common Stock issued upon conversion of any of such shares of Series D’ Preferred Stock (whether such issuances occur prior or subsequent to the date hereof).

(ii) No Adjustment of Conversion Price. Any provision herein to the contrary notwithstanding, no adjustment in the Series B-1, Series C, Series D, Series D’ or Series E Conversion Price shall be made in respect of the issuance of Additional Shares of Common Stock unless the consideration per share (determined pursuant to Section B.5(d)(v) hereof) for an Additional Share of Common Stock issued or deemed to be issued by the Corporation is less than the Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price or Series E Conversion Price for the Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock in effect on the date of, and immediately prior to such issue.

(iii) Deemed Issue of Additional Shares of Common Stock. In the event the Corporation at any time or from time to time after the Series E Original Issue Date shall issue any Options or Convertible Securities or shall fix a record date for the determination of holders of any class of securities then entitled to receive any such Options or Convertible Securities, then the maximum number of shares (as set forth in the instrument relating thereto without regard to any provisions contained therein designed to protect against dilution) of Common Stock issuable upon the exercise of such Options or, in the case of Convertible Securities and Options therefor, the conversion or exchange of such Convertible Securities, shall be deemed to be Additional Shares of Common Stock (except as provided in Section B.5.d(i)(3)) issued as of the time of such issue or, in case such a record date shall have been fixed, as of the close of business on such record date, provided further that in any such case in which Additional Shares of Common Stock are deemed to be issued:

(1) no further adjustments in the Series B-1, Series C, Series D, Series D’ or Series E Conversion Price shall be made upon the subsequent issue of Convertible Securities or shares of Common Stock upon the exercise of such Options or conversion or exchange of such Convertible Securities;

(2) if such Options or Convertible Securities by their terms provide, with the passage of time or otherwise, for any increase in the consideration payable to the Corporation, or decrease in the number of shares of Common Stock issuable, upon the exercise, conversion or exchange thereof, the Series B-1, Series C, Series D, Series D’ or Series E Conversion Price computed upon the original issue thereof (or upon the occurrence of a record

Exhibit A – Page 14

date with respect thereto), and any subsequent adjustments based thereon, shall, upon any such increase or decrease becoming effective, be recomputed to reflect such increase or decrease insofar as it affects such Options or the rights of conversion or exchange under such Convertible Securities (provided, however, that no such adjustment of the Series B-1, Series C, Series D, Series D’ or Series E Conversion Price shall effect Common Stock previously issued upon conversion of the Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock);

(3) upon the expiration of any such options or rights, the termination of any such rights to convert or exchange or the expiration of any options or rights related to such convertible or exchangeable securities, the Series B-1, Series C, Series D, Series D’ and Series E Conversion Prices, to the extent in any way affected by or computed using such options, rights or securities or options or rights related to such securities, shall be recomputed to reflect the issuance of only the number of shares of Common Stock (and convertible or exchangeable securities which remain in effect) actually issued upon the exercise of such options or rights, upon the conversion or exchange of such securities or upon the exercise of the options or rights related to such securities; or

(4) no readjustment pursuant to clause (2) or (3) above shall have the effect of increasing the Series B-1, Series C, Series D, Series D’ or Series E Conversion Price to an amount which exceeds the lower of (a) the Series B-1, Series C, Series D, Series D’ or Series E Conversion Price on the original adjustment date, or (b) the Series B-1, Series C, Series D, Series D’ or Series E Conversion Price that would have resulted from any issuance of Additional Shares of Common Stock between the original adjustment date and such readjustment date.

(iv) Adjustment of Conversion Price Upon Issuance of Additional Shares of Common Stock. In the event this Corporation, at any time after the Series E Original Issue Date, shall issue Additional Shares of Common Stock (including Additional Shares of Common Stock deemed to be issued pursuant to Section B.5(d)(iii)) without consideration or for a consideration per share less than the Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price or Series E Conversion Price in effect on the date of and immediately prior to such issue, then and in such event, as applicable, the Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price and Series E Conversion Price shall be reduced, as applicable, concurrently with such issue, to a price (calculated to the nearest thousandth of a cent) determined by multiplying such Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price and Series E Conversion Price by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding immediately prior to such issue plus the number of shares of Common Stock which the aggregate consideration received by the Corporation for the total number of Additional Shares of Common Stock so issued would purchase at such Series B-1, Series C, Series D, Series D’ or Series E Conversion Price, as applicable, in effect immediately prior to such issuance, and the denominator of which shall be the number of shares of Common Stock outstanding immediately prior to such issue plus the number of such Additional Shares of Common Stock so issued. For the purpose of the above calculation, the number of shares

Exhibit A – Page 15

of Common Stock outstanding immediately prior to such issue shall be calculated on a fully diluted basis, as if all shares of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock and all outstanding Convertible Securities had been fully converted into shares of Common Stock and any outstanding warrants, options or other rights for the purchase of shares of stock or convertible securities had been fully exercised (and the resulting securities fully converted into shares of Common Stock, if so convertible) as of such date.

(v) Determination of Consideration. For purposes of this Section B.5(d), the consideration received by the Corporation for the issue of any Additional Shares of Common Stock shall be computed as follows:

(1) Cash and Property: Such consideration shall:

(A) insofar as it consists of cash, be computed at the aggregate amount of cash received by the Corporation excluding amounts paid or payable for accrued interest or accrued dividends;

(B) insofar as it consists of property other than cash, be computed at the fair value thereof at the time of such issue, as determined in good faith by the Board; and

(C) in the event Additional Shares of Common Stock are issued together with other shares or securities or other assets of the Corporation for consideration which covers both, be the proportion of such consideration so received, computed as provided in clauses (A) and (B) above, as determined in good faith by the Board.

(2) Options and Convertible Securities. The consideration per share received by the Corporation for Additional Shares of Common Stock deemed to have been issued pursuant to Section B.5(d)(iii), relating to Options and Convertible Securities shall be determined by dividing

(A) the total amount, if any, received or receivable by the Corporation as consideration for the issue of such Options or Convertible Securities, plus the minimum aggregate amount of additional consideration (as set forth in the instruments relating thereto, without regard to any provision contained therein designed to protect against dilution) payable to the Corporation upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible Securities, the exercise of such Options for Convertible Securities and the conversion or exchange of such Convertible Securities by

(B) the maximum number of shares of Common Stock (as set forth in the instruments relating thereto, without regard to any provision contained therein designed to protect against the dilution) issuable upon the exercise of such Options or conversion or exchange of such Convertible Securities.

Exhibit A – Page 16

e. Adjustments to Conversion Prices for Stock Dividends and for Combinations or Subdivisions of Common Stock. If this Corporation, at any time or from time to time after the Series E Original Issue Date shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock or in any right to acquire Common Stock for no consideration, or shall effect a subdivision of the outstanding shares of Common Stock into a greater number of shares of Common Stock (by stock split, reclassification or otherwise than by payment of a dividend in Common Stock or in any right to acquire Common Stock), or if the outstanding shares of Common Stock shall be combined or consolidated, by reclassification or otherwise, into a lesser number of shares of Common Stock, then the Series A Conversion Price, Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price and Series E Conversion Price in effect immediately prior to such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate. In the event that this Corporation shall declare or pay, without consideration, any dividend on the Common Stock payable in any right to acquire Common Stock for no consideration then the Corporation shall be deemed to have made a dividend payable in Common Stock in an amount of shares equal to the maximum number of shares issuable upon exercise of such rights to acquire Common Stock.

f. Adjustments for Reclassification and Reorganization. If, at any time or from time to time after the Series E Original Issue Date the Common Stock issuable upon conversion of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock shall be changed into the same or a different number of shares of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision or combination of shares provided for in Section B.5(e) above or a merger or other reorganization referred to in Section B.2(d) above), the Series A Conversion Price, Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price and Series E Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock that the holders would otherwise have been entitled to receive, a number of shares of such other class or classes of stock equivalent to the number of shares of Common Stock that would have been subject to receipt by the holders upon conversion of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock immediately before that change.

g. No Impairment. Subject to the right of the Corporation to amend this Certificate or to take any other corporate action upon obtaining the necessary approvals required by this Certificate and applicable law, the Corporation will not, except in accordance with the Delaware General Corporation Law and Section B.6 hereof, by amendment of this Certificate or through any 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 hereunder by the Corporation, but will at all times in good faith assist in the carrying out of all the provisions of this Section B.5 and in the taking of all such action as may be necessary or appropriate in order to protect the Conversion Rights of the holders of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock against impairment.

Exhibit A – Page 17

h. Certificates as to Adjustments. Upon the occurrence of each adjustment or readjustment of the Series A Conversion Price, Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price and Series E Conversion Price pursuant to this Section B.5, the Corporation at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock a certificate executed by the Corporation’s Chief Executive Officer, President or a Vice President setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, upon the written request at any time of any holder of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, (ii) the Series A Conversion Price, Series B-1 Conversion Price, Series C Conversion Price, Series D Conversion Price, Series D’ Conversion Price and Series E Conversion Price, as the case may be, at the time in effect, and (iii) the number of shares of Common Stock and the amount, if any, of other property that at the time would be received upon the conversion of the Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock.

i. Notices of Record Date. If the Corporation shall propose at any time: (i) to declare any dividend or distribution upon its Common Stock, whether in cash, property, stock or other securities, whether or not a regular cash dividend and whether or not out of earnings or earned surplus; (ii) to offer for subscription pro rata to the holders of any class or series of its stock any additional shares of stock of any class or series or other rights; (iii) to effect any reclassification or recapitalization of its Common Stock outstanding involving a change in the Common Stock; or (iv) to merge or consolidate with or into any other corporation, or sell, lease or convey all or substantially all of its assets, or to liquidate, dissolve or wind up; then, in connection with each such event, the Corporation shall send to the holders of Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock: (1) at least twenty (20) days prior written notice of the date on which a record shall be taken for such dividend, distribution or subscription rights (and specifying the date on which the holders of Common Stock shall be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (iii) and (iv) above; and (2) in the case of the matters referred to in (iii) and (iv) above, at least twenty (20) days prior written notice of the date when the same shall take place (and specifying the date on which the holders of Common Stock shall be entitled to exchange their Common Stock for securities or other property deliverable upon the occurrence of such event).

j. Reservation of Stock Issuable Upon Conversion. The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock; and if at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Series A, Series B-1, Series C, Series D, Series D’ and Series E Preferred Stock, the Corporation will take such corporate action

Exhibit A – Page 18

as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose, including, without limitation, engaging in best efforts to obtain the requisite stockholder approval of any necessary amendment to this Certificate.

k. Fractional Shares. No fractional share shall be issued upon the conversion of any share or shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock. All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock by a holder thereof shall be aggregated for purposes of determining whether the conversion would result in the issuance of any fractional share. If, after the aforementioned aggregation, the conversion would result in the issuance of a fraction of a share of Common Stock, the Corporation shall, in lieu of issuing any fractional share, pay the holder otherwise entitled to such fraction a sum in cash equal to the fair market value of such fraction on the date of conversion (as determined in good faith by the Board of Directors).

l. Notices. Any notice required by the provisions of this Section B.5 to be given to the holders of shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock shall be deemed given if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his address appearing on the books of the Corporation.

6. Preferred Stock Protective Provisions. So long as at least 1,000,000 shares of any combination of Series A, Series B-1, Series C, Series D, Series D’ and/or Series E Preferred Stock remain outstanding (as adjusted for any stock dividends, combinations or splits with respect to such shares), the Corporation shall not, without the vote or written consent by the holders of at least a majority of the then outstanding shares of the Series A, Series B-1, Series C, Series D, Series D’ and/or Series E Preferred Stock, voting together as a single class:

a. Authorize, create or issue, or obligate itself to issue, any other equity security (including any security convertible into or exercisable for any equity security) having rights, preferences or privileges senior to or on a parity with the Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock with respect to dividends or upon a redemption or liquidation;

b. Do any act or thing that results in the redemption of any shares of Preferred Stock or Common Stock (except repurchases upon termination of service and similar contractual arrangements or redemptions in accordance with Section B.3);

c. Do any act or thing that results in the payment or declaration of any dividend on any shares of Common Stock or Preferred Stock (except repurchases upon termination of service and similar contractual arrangements);

d. Consummate any transaction that results in (i) a Liquidation Event, (ii) a sale of the Corporation’s Common Stock in a firm commitment, underwritten public offering registered under the Securities Act, or (iii) the issuance of Additional Shares of Common Stock for equity financing purposes;

Exhibit A – Page 19

e. Amend or alter its Certificate or Bylaws, or waive any provision thereof;

f. Increase or decrease (other than by conversion) the authorized number of shares of Common Stock or any class or series of Preferred Stock;

g. Materially and adversely alter or change the rights, preferences or privileges of the Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock;

h. Increase or decrease the authorized size of the Corporation’s Board of Directors;

i. Issue any debt or guarantees of indebtedness in an amount exceeding $500,000 in any one transaction, unless such action is approved by the Board;

j. Permit a subsidiary of the Corporation to sell securities to a third party;

k. Materially change the Corporation’s line of business; or

l. Consummate any transaction between the Corporation and any founder or director, other than in the ordinary course of business on arms-length terms.

7. Series D and Series D’ Protective Provisions. So long as at least an aggregate of 1,000,000 shares of Series D and Series D’ Preferred Stock remain outstanding (as adjusted for any stock dividends, combinations or splits with respect to such shares), the Corporation shall not, without the vote or written consent by the holders of at least an aggregate of sixty-six and two-thirds percent (66 2/3%) of the then outstanding shares of Series D and Series D’ Preferred Stock, voting together as a single class:

a. Materially and adversely alter or change the rights, preferences or privileges of the Series D or Series D’ Preferred Stock;

b. Increase the number of authorized shares of Series D or Series D’ Preferred Stock or authorize, create or issue, or obligate itself to issue, any other equity security (including any security convertible into or exercisable for any equity security) having rights, preferences or privileges senior to or on a parity with the Series D or Series D’ Preferred Stock; or

c. Take any action that reclassifies any outstanding shares of Preferred or Common Stock into shares having rights as to dividends or liquidation preferences senior to or on a parity with the Series D or Series D’ Preferred Stock.

8. No Reissuance of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock. No share or shares of Series A, Series B-1, Series C, Series D, Series D’ or Series E Preferred Stock acquired by the Corporation by reason of purchase, conversion or otherwise shall be reissued, and all such shares shall be cancelled, retired and eliminated from the shares that the Corporation shall be authorized to issue.

Exhibit A – Page 20

C. The Common Stock.

1. Dividend Rights. Subject to the prior rights of the holders of all classes of stock at the time outstanding having prior rights as to dividends, the holders of the Common Stock shall be entitled to receive, when and as declared by the Board of Directors, out of any assets or the Corporation legally available therefor, such dividends as may be declared from time to time by the Board of Directors.

2. Liquidation Rights. Upon the liquidation, dissolution or winding up of the Corporation, the assets of the Corporation shall be distributed as provided in Section B.2 of this Article IV.

3. Voting Rights. The holder of each share of Common Stock shall have the right to one vote, and shall be entitled to notice of any stockholders’ meeting in accordance with the Bylaws of this Corporation, and shall be entitled to vote upon such matters and in such manner as may be provided by law.

ARTICLE V

A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived any improper personal benefit. If the Delaware General Corporation Law is amended after approval by the stockholders of this Article to authorize Corporation action further eliminating or limiting the personal liability of directors then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law as so amended.

The Company is authorized to provide indemnification of agents (as defined in Section 317 of the CGCL) for breach of duty to the Company and its stockholders through bylaw provisions or through agreements with the agents, or through stockholder resolutions, or otherwise, in excess of the indemnification otherwise permitted by Section 317 of the CGCL, subject, at any time or times that the Company is subject to Section 2115(b) of the CGCL, to the limits on such excess indemnification set forth in Section 204 of the CGCL

Any repeal or modification of the foregoing provisions of this Article V by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification.

ARTICLE VI

Meetings of stockholders may be held within or without the State of Delaware, as the Bylaws may provide. The books of the Corporation may be kept (subject to any provision contained in the statutes) outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the Bylaws of the Corporation.

Exhibit A – Page 21

ARTICLE VII

Except as otherwise provided in this Certificate, in furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized to make, repeal, alter, amend and rescind any or all of the Bylaws of the Corporation.

Exhibit A – Page 22

EX-3.3

Exhibit 3.3

BYLAWS

OF

DANGER RESEARCH, INC.,

a Delaware corporation

ARTICLE I.

OFFICES

Section 1. Registered Office. The registered office shall be at the office of Paracorp Incorporated, 15 East North Street, in the City of Dover, County of Kent, State of Delaware.

Section 2. Other Offices. The corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the corporation may require.

ARTICLE II.

MEETINGS OF STOCKHOLDERS

Section 1. Annual Meeting. An annual meeting of the stockholders for the election of directors shall be held at such place either within or without the State of Delaware as shall be designated on an annual basis by the Board of Directors and stated in the notice of the meeting. Meetings of stockholders for any other purpose may be held at such time and place, within or without the State of Delaware, as shall be stated in the notice of the meeting or in a duly executed waiver of notice thereof. Any other proper business may be transacted at the annual meeting.

Section 2. Notice of Annual Meeting. Written notice of the annual meeting stating the place, date and hour of the meeting shall be given to each stockholder entitled to vote at such meeting not less than ten nor more than sixty days before the date of the meeting.

Section 3. Voting List. The officer who has charge of the stock ledger of the corporation shall prepare and make, or cause a third party to prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.

Section 4. Special Meetings. Special meetings of the stockholders of this corporation, for any purpose or purposes, unless otherwise prescribed by statute or by the Certificate of Incorporation, shall be called by the President or Secretary at the request in writing of a majority of the members of the Board of Directors or holders of at least ten percent (10%) of the total voting power of all outstanding shares of stock of this corporation then entitled to vote, and may not be called absent such a request. Such request shall state the purpose or purposes of the proposed meeting.

Section 5. Notice of Special Meetings. As soon as reasonably practicable after receipt of a request as provided in Section 4 of this Article II, written notice of a special meeting, stating the place, date (which shall be not less than ten nor more than sixty days from the date of the notice) and hour of the special meeting and the purpose or purposes for which the special meeting is called, shall be given to each stockholder entitled to vote at such special meeting.

Section 6. Scope of Business at Special Meeting. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice.

Section 7. Quorum. The holders of a majority of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business, except as otherwise provided by statute or by the Certificate of Incorporation. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the chairman of the meeting or the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. If the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting as provided in Section 5 of this Article II.

Section 8. Qualifications to Vote. The stockholders of record on the books of the corporation at the close of business on the record date as determined by the Board of Directors and only such stockholders shall be entitled to vote at any meeting of stockholders or any adjournment thereof.

Section 9. Record Date. The Board of Directors may fix a record date for the determination of the stockholders entitled to notice of or to vote at any stockholders’ meeting and at any adjournment thereof, or to express consent to corporate action in writing without a meeting, or to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action. The record date shall not be more than sixty nor less than ten days before the date of such meeting, and not more than sixty days prior to any other action. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of

2.

stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

Section 10. Action at Meetings. When a quorum is present at any meeting, the vote of the holders of a majority of the shares of stock having voting power present in person or represented by proxy shall decide any question brought before such meeting, unless the question is one upon which by express provision of applicable law or of the Certificate of Incorporation, a different vote is required, in which case such express provision shall govern and control the decision of such question.

Section 11. Voting and Proxies. Unless otherwise provided in the Certificate of Incorporation, each stockholder shall at every meeting of the stockholders be entitled to one vote in person or by proxy for each share of the capital stock having voting power held by such stockholder, but no proxy shall be voted on after three years from its date, unless the proxy provides for a longer period. Each proxy shall be revocable unless expressly provided therein to be irrevocable and unless it is coupled with an interest sufficient in law to support an irrevocable power.

Section 12. Action by Stockholders Without a Meeting. Unless otherwise provided in the Certificate of Incorporation, any action required to be taken at any annual or special meeting of stockholders of the corporation, or any action which may be taken at any annual or special meeting of such stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the corporation by delivery to its registered office in the State of Delaware (by hand or by certified or registered mail, return receipt requested), to its principal place of business, or to an officer or agent of the corporation having custody of the book in which proceedings of meetings of stockholders are recorded provided, however, that action by written consent to elect directors, if less than unanimous, shall be in lieu of holding an annual meeting only if all the directorships to which directors could be elected at an annual meeting held at the effective time of such action are vacant and are filled by such action. Prompt notice of the taking of corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for such meeting had been the date that written consents signed by a sufficient number of stockholders to take the action were delivered to the corporation by delivery to its registered office in the State of Delaware (by hand or by certified or registered mail, return receipt requested), to its principal place of business, or to an officer or agent of the corporation having custody of the book in which proceedings or meetings of stockholders are recorded.

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ARTICLE III.

DIRECTORS

Section 1. Powers. The business of the corporation shall be managed by or under the direction of its Board of Directors, which may exercise all such powers of the corporation and do all such lawful acts and things as are not by applicable law or by the Certificate of Incorporation or by these Bylaws directed or required to be exercised or done by the stockholders.

Section 2. Number; Election; Tenure and Qualification. Unless otherwise provided in the Certificate of Incorporation, the number of directors which shall constitute the whole board shall be fixed from time to time by resolution of the Board of Directors or by the Stockholders at an annual meeting of the Stockholders (unless the directors are elected by written consent in lieu of an annual meeting as provided in Article II, Section 12). With the exception of the first Board of Directors, which shall be elected by the incorporator, and except as provided in the corporation’s Certificate of Incorporation or in Section 3 of this Article III, the directors shall be elected at the annual meeting of the stockholders by a plurality vote of the shares represented in person or by proxy and each director elected shall hold office until his successor is elected and qualified unless he shall resign, become disqualified, disabled, or otherwise removed. Directors need not be stockholders.

Section 3. Vacancies and Newly Created Directorships. Unless otherwise provided in the Certificate of Incorporation, vacancies and newly-created directorships resulting from any increase in the authorized number of directors may be filled by a majority of the directors then in office, though less than a quorum, or by a sole remaining director. The directors so chosen shall serve until the next annual election and until their successors are duly elected and shall qualify, unless sooner displaced. If there are no directors in office, then an election of directors may be held in the manner provided by applicable law. If, at the time of filling any vacancy or any newly created directorship, the directors then in office shall constitute less than a majority of the whole board (as constituted immediately prior to any such increase), the Court of Chancery may, upon application of any stockholder or stockholders holding at least ten percent of the total number of shares at the time outstanding having the right to vote for such directors, summarily order an election to be held to fill any such vacancies or newly created directorships, or to replace the directors chosen by the directors then in office.

Section 4. Location of Meetings. The Board of Directors of the corporation may hold meetings, both regular and special, either within or without the State of Delaware.

Section 5. Meeting of Newly Elected Board of Directors. The first meeting of each newly elected Board of Directors shall be held immediately following the annual meeting of stockholders and no notice of such meeting shall be necessary to the newly elected directors in order legally to constitute the meeting, provided a quorum shall be present. In the event such meeting is not held at such time, the meeting may be held at such time and place as shall be specified in a notice given as hereinafter provided for special meetings of the Board of Directors, or as shall be specified in a written waiver signed by all of the directors.

Section 6. Regular Meetings. Regular meetings of the Board of Directors may be held without notice at such time and at such place as shall from time to time be determined by

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the Board of Directors; provided that any director who is absent when such a determination is made shall be given notice of such location.

Section 7. Special Meetings. Special meetings of the Board of Directors may be called by the President on two days’ notice to each director by mail, overnight courier service or facsimile; special meetings shall be called by the President or Secretary in a like manner and on like notice on the written request of two directors unless the Board of Directors consists of only one director, in which case special meetings shall be called by the President or Secretary in a like manner and on like notice on the written request of the sole director. Notice may be waived in accordance with Section 229 of the General Corporation Law of the State of Delaware.

Section 8. Quorum and Action at Meetings. At all meetings of the Board of Directors, a majority of the directors then in office shall constitute a quorum for the transaction of business, and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise specifically provided by statute or by the Certificate of Incorporation. If a quorum shall not be present at any meeting of the Board of Directors, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.

Section 9. Action Without a Meeting. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board of Directors or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or committee.

Section 10. Telephonic Meeting. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, members of the Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting of the Board of Directors, or any committee, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

Section 11. Committees. The Board of Directors may, by resolution passed by a majority of the whole board, designate one or more committees, each committee to consist of one or more of the directors of the corporation. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member.

Section 12. Committee Authority. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation, and may

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authorize the seal of the corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority in reference to (a) approving, adopting or recommending to the stockholders, any action or matter expressly required by the General Corporation Law of the State of Delaware to be submitted to stockholders for approval, or (b) adopting, amending or repealing any Bylaw of the corporation. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board of Directors.

Section 13. Committee Minutes. Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors when required to do so by the Board of Directors.

Section 14. Directors Compensation. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, the Board of Directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as director. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like compensation for attending committee meetings.

Section 15. Resignation. Any director or officer of the corporation may resign at any time. Each such resignation shall be made in writing and shall take effect at the time specified therein, or, if no time is specified, at the time of its receipt by either the Board of Directors, the President or the Secretary. The acceptance of a resignation shall not be necessary to make it effective unless expressly so provided in the resignation.

Section 16. Removal. Unless otherwise restricted by the Certificate of Incorporation, these Bylaws or applicable law, any director or the entire Board of Directors may be removed, with or without cause, by the holders of a majority of shares entitled to vote at an election of directors.

ARTICLE IV.

NOTICES

Section 1. Notice to Directors and Stockholders. Whenever, under the provisions of the statutes or of the Certificate of Incorporation or of these Bylaws, notice is required to be given to any director or stockholder, it shall not be construed to mean personal notice, but such notice may be given in writing, by mail, addressed to such director or stockholder, at his address as it appears on the records of the corporation, with postage thereon prepaid, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail. An affidavit of the Secretary or an Assistant Secretary or of the transfer agent of the corporation that the notice has been given shall in the absence of fraud, be prima facie evidence of the facts stated therein. Notice to directors may also be given by telephone, facsimile or telegram (with confirmation of receipt).

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Section 2. Waiver. Whenever any notice is required to be given under the provisions of the statutes or of the Certificate of Incorporation or of these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent thereto. The written waiver need not specify the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders, directors, or members of a committee of directors. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Attendance at the meeting is not a waiver of any right to object to the consideration of matters required by the General Corporation Law of the State of Delaware to be included in the notice of the meeting but not so included, if such objection is expressly made at the meeting.

ARTICLE V.

OFFICERS

Section 1. Enumeration. The officers of the corporation shall be chosen by the Board of Directors and shall include a President, a Secretary, a Treasurer or Chief Financial Officer and such other officers with such other titles as the Board of Directors shall determine. The Board of Directors may elect from among its members a Chairman or Chairmen of the Board and a Vice Chairman of the Board. The Board of Directors may also choose one or more Vice-Presidents, Assistant Secretaries and Assistant Treasurers. Any number of offices may be held by the same person, unless the Certificate of Incorporation or these Bylaws otherwise provide.

Section 2. Election. The Board of Directors at its first meeting after each annual meeting of stockholders shall elect a President, a Secretary, a Treasurer and such other officers with such other titles as the Board of Directors shall determine.

Section 3. Appointment of Other Agents. The Board of Directors may appoint such other officers and agents as it shall deem necessary, who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors.

Section 4. Compensation. The salaries of all officers of the corporation shall be fixed by the Board of Directors or a committee thereof The salaries of agents of the corporation shall, unless fixed by the Board of Directors, be fixed by the President or any Vice-President of the corporation.

Section 5. Tenure. The officers of the corporation shall hold office until their successors are chosen and qualify. Any officer elected or appointed by the Board of Directors may be removed at any time by the affirmative vote of a majority of the directors of the Board of Directors. Any vacancy occurring in any office of the corporation shall be filled by the Board of Directors.

Section 6. Chairman of the Board and Vice-Chairman of the Board. The Chairman of the Board, if any, shall preside at all meetings of the Board of Directors and of the stockholders at which the Chairman shall be present. The Chairman shall have and may exercise

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such powers as are, from time to time, assigned to the Chairman by the Board of Directors and as may be provided by law. In the absence of the Chairman of the Board, the Vice Chairman of the Board, if any, shall preside at all meetings of the Board of Directors and of the stockholders at which the Vice Chairman shall be present. The Vice Chairman shall have and may exercise such powers as are, from time to time, assigned to such person by the Board of Directors and as may be provided by law.

Section 7. President. The President shall be the Chief Executive Officer of the corporation unless such title is assigned to another officer of the corporation; in the absence of a Chairman and Vice Chairman of the Board, the President shall preside as the chairman of meetings of the stockholders and the Board of Directors; and the President shall have general and active management of the business of the corporation and shall see that all orders and resolutions of the Board of Directors are carried into effect. The President or any Vice President shall execute bonds, mortgages and other contracts requiring a seal, under the seal of the corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the Board of Directors to some other officer or agent of the corporation.

Section 8. Vice-President. In the absence of the President or in the event of the President’s inability or refusal to act, the Vice-President, if any (or in the event there be more than one Vice-President, the Vice-Presidents in the order designated by the Board of Directors, or in the absence of any designation, then in the order of their election) shall perform the duties of the President, and when so acting shall have all the powers of and be subject to all the restrictions upon the President. The Vice-President shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

Section 9. Secretary. The Secretary shall attend all meetings of the Board of Directors and all meetings of the stockholders and record all the proceedings of the meetings of the corporation and of the Board of Directors in a book to be kept for that purpose and shall perform like duties for the standing committees when required. The Secretary shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors or President, under whose supervision the Secretary shall be subject. The Secretary shall have custody of the corporate seal of the corporation and the Secretary, or an Assistant Secretary, shall have authority to affix the same to any instrument requiring it and when so affixed, it may be attested by the Secretary’s signature or by the signature of such Assistant Secretary. The Board of Directors may give general authority to any other officer to affix the seal of the corporation and to attest the affixing by such officer’s signature.

Section 10. Assistant Secretary. The Assistant Secretary, or if there be more than one, the Assistant Secretaries in the order determined by the Board of Directors (or if there be no such determination, then in the order of their election) shall, in the absence of the Secretary or in the event of the Secretary’s inability or refusal to act, perform the duties and exercise the powers of the Secretary and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

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Section 11. Treasurer. The Treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the Board of Directors. The Treasurer shall disburse the funds of the corporation as may be ordered by the Board of Directors, President or Chief Executive Officer, taking proper vouchers for such disbursements, and shall render to the President, Chief Executive Officer and the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all such transactions as Treasurer and of the financial condition of the corporation. If required by the Board of Directors, the Treasurer shall give the corporation a bond (which shall be renewed every six years) in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of the Treasurer’s office and for the restoration to the corporation, in case of the Treasurer’s death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in the possession or under the control of the Treasurer that belongs to the corporation.

Section 12. Assistant Treasurer. The Assistant Treasurer, or if there be more than one, the Assistant Treasurers in the order determined by the Board of Directors (or if there be no such determination, then in the order of their election) shall, in the absence of the Treasurer or in the event of the Treasurer’s inability or refusal to act, perform the duties and exercise the powers of the Treasurer and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

ARTICLE VI.

CAPITAL STOCK

Section 1. Certificates. The shares of the corporation shall be represented by a certificate, unless and until the Board of Directors adopts a resolution permitting shares to be uncertificated. Certificates shall be signed by, or in the name of the corporation by, (a) the Chairman of the Board, the Vice-Chairman of the Board, the President or a Vice-President, and (b) the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary, certifying the number of shares owned by such stockholder in the corporation. Certificates may be issued for partly paid shares and in such case upon the face or back of the certificates issued to represent any such partly paid shares, the total amount of the consideration to be paid therefor and the amount paid thereon shall be specified.

Section 2. Class or Series. If the corporation shall be authorized to issue more than one class of stock or more than one series of any class, the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or back of the certificate which the corporation shall issue to represent such class or series of stock, provided that, except as otherwise provided in Section 202 of the General Corporation Law of the State of Delaware, in lieu of the foregoing requirements, there may be set forth on the face or back of the certificate which the corporation shall issue to represent such class or series of stock, a statement that the corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative,

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participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights. Within a reasonable time after the issuance or transfer of uncertificated stock, the corporation shall send to the registered owner thereof a written notice containing the information required to be set forth or stated on certificates pursuant to Sections 151, 156, 202(a) or 218(a) of the Delaware Corporation Law or a statement that the corporation will furnish without charge, to each stockholder who so requests, the powers, designations, preferences and relative participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.

Section 3. Signature. Any of or all of the signatures on a certificate may be facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue.

Section 4. Lost Certificates. The Board of Directors may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate or certificates, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or such owner’s legal representative, to advertise the same in such manner as it shall require and/or to give the corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost, stolen or destroyed.

Section 5. Transfer of Stock. Upon surrender to the corporation or the transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignation or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. Upon receipt of proper transfer instructions from the registered owner of uncertificated shares such uncertificated shares shall be canceled and issuance of new equivalent uncertificated shares or certificated shares shall be made to the person entitled thereto and the transaction shall be recorded upon the books of the corporation.

Section 6. Record Date. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholder or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a record date, which shall not be more than sixty nor less than ten days before the date of such meeting, nor more than sixty days prior to any other action. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

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Section 7. Registered Stockholders. The corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware.

ARTICLE VII.

GENERAL PROVISIONS

Section 1. Dividends. Dividends upon the capital stock of the corporation, subject to the applicable provisions, if any, of the Certificate of Incorporation, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property or in shares of capital stock, subject to the provisions of the Certificate of Incorporation. Before payment of any dividend, there may be set aside out of any funds of the corporation available for dividends such sum or sums as the Board of Directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purposes as the Board of Directors shall think conducive to the interest of the corporation, and the Board of Directors may modify or abolish any such reserve in the manner in which it was created.

Section 2. Checks. All checks or demands for money and notes of the corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

Section 3. Fiscal Year. The fiscal year of the corporation shall be fixed by resolution of the Board of Directors.

Section 4. Seal. The Board of Directors may adopt a corporate seal having inscribed thereon the name of the corporation, the year of its organization and the words “Corporate Seal, Delaware”. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

Section 5. Loans. The Board of Directors of this corporation may, without stockholder approval, authorize loans to, or guaranty obligations of, or otherwise assist, including, without limitation, the adoption of employee benefit plans under which loans and guarantees may be made, any officer or other employee of the corporation or of its subsidiary, including any officer or employee who is a director of the corporation or its subsidiary, whenever, in the judgment of the Board of Directors, such loan, guaranty or assistance may reasonably be expected to benefit the corporation. The loan, guaranty or other assistance may be with or without interest, and may be unsecured, or secured in such manner as the Board of Directors shall approve, including, without limitation, a pledge of shares of stock of the corporation.

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ARTICLE VIII.

INDEMNIFICATION

Section 1. Scope. The corporation shall, to the fullest extent permitted by Section 145 of the General Corporation Law of the State of Delaware, as that Section may be amended and supplemented from time to time, indemnify any director, officer, employee or agent of the corporation, against expenses (including attorneys’ fees), judgments, fines, amounts paid in settlement and/or other matters referred to in or covered by that Section, by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.

Section 2. Advancing Expenses. Expenses (including attorneys’ fees) incurred by a present or former director or officer of the corporation in defending a civil, criminal, administrative or investigative action, suit or proceeding by reason of the fact that such person is or was a director, officer, employee or agent of the corporation (or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise) shall be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized by relevant provisions of the General Corporation Law of the State of Delaware; provided, however, the corporation shall not be required to advance such expenses to a director (i) who commences any action, suit or proceeding as a plaintiff unless such advance is specifically approved by a majority of the Board of Directors, or (ii) who is a party to an action, suit or proceeding brought by the corporation and approved by a majority of the Board of Directors which alleges willful misappropriation of corporate assets by such director, disclosure of confidential information in violation of such director’s fiduciary or contractual obligations to the corporation, or any other willful and deliberate breach in bad faith of such director’s duty to the corporation or its stockholders.

Section 3. Liability Offset. The corporation’s obligation to provide indemnification under this Article VIII shall be offset to the extent the indemnified party is indemnified by any other source including, but not limited to, any applicable insurance coverage under a policy maintained by the corporation, the indemnified party or any other person.

Section 4. Continuing Obligation. The provisions of this Article VIII shall be deemed to be a contract between the corporation and each director of the corporation who serves in such capacity at any time while this bylaw is in effect, and any repeal or modification thereof shall not affect any rights or obligations then existing with respect to any state of facts then or theretofore existing or any action, suit or proceeding theretofore or thereafter brought based in whole or in part upon any such state of facts.

Section 5. Nonexclusive. The indemnification and advancement of expenses provided for in this Article VIII shall (i) not be deemed exclusive of any other rights to which those indemnified may be entitled under any bylaw, agreement or vote of stockholders or disinterested directors or otherwise, both as to action in their official capacities and as to action

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in another capacity while holding such office, (ii) continue as to a person who has ceased to be a director and (iii) inure to the benefit of the heirs, executors and administrators of such a person.

Section 6. Other Persons. In addition to the indemnification rights of directors, officers, employees, or agents of the corporation, the Board of Directors in its discretion shall have the power on behalf of the corporation to indemnify any other person made a party to any action, suit or proceeding who the corporation may indemnify under Section 145 of the General Corporation Law of the State of Delaware.

Section 7. Definitions. The phrases and terms set forth in this Article VIII shall be given the same meaning as the identical terms and phrases are given in Section 145 of the General Corporation Law of the State of Delaware, as that Section may be amended and supplemented from time to time.

ARTICLE IX.

AMENDMENTS

Except as otherwise provided in the Certificate of Incorporation, these Bylaws may be altered, amended or repealed, or new Bylaws may be adopted, by the holders of a majority of the outstanding voting shares or by the Board of Directors, when such power is conferred upon the Board of Directors by the Certificate of Incorporation, at any regular meeting of the stockholders or of the Board of Directors or at any special meeting of the stockholders or of the Board of Directors if notice of such alteration, amendment, repeal or adoption of new Bylaws be contained in the notice of such special meeting. If the power to adopt, amend or repeal Bylaws is conferred upon the Board of Directors by the Certificate of Incorporation, it shall not divest or limit the power of the stockholders to adopt, amend or repeal Bylaws.

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AMENDMENT TO THE

BYLAWS OF

DANGER, INC.

By action of the Board of Directors of Danger, Inc., a Delaware corporation (the “Company”) taken at a meeting held on January 23, 2003, Section 2 of Article III of the Bylaws of the Company is amended and restated in its entirety to read as follows:

“Section 2. Number; Election; Tenure and Qualification. Unless otherwise provided in the Certificate of Incorporation, the number of directors which shall constitute the whole board shall be fixed at seven (7). With the exception of the first Board of Directors, which shall be elected by the incorporator, and except as provided in the corporation’s Certificate of Incorporation or in Section 3 of this Article III, the directors shall be elected at the annual meeting of the stockholders by a plurality vote of the shares represented in person or by proxy and each director elected shall hold office until his successor is elected and qualified unless he shall resign, become disqualified, disabled, or otherwise removed. Directors need not be stockholders.”

EX-4.3

Exhibit 4.3

DANGER, INC.

AMENDED AND RESTATED INVESTORS’ RIGHTS AGREEMENT

Dated as of December 10, 2007

TABLE OF CONTENTS

				Page
1.	INFORMATION RIGHTS			2
	1.1	Financial Information		2
		(a)	Annual Reports	2
		(b)	Quarterly Reports	2
		(c)	Annual Budget	2
		(d)	Operating Plan	2
		(e)	Other Information	2
	1.2	Inspection Rights		2
	1.3	Termination of Certain Rights		2
2.	REGISTRATION RIGHTS			3
	2.1	Definitions		3
		(a)	Registration	3
		(b)	Registrable Securities	3
		(c)	Registrable Securities Then Outstanding	3
		(d)	Heller	3
		(e)	Heller Warrants	3
		(f)	Holder	4
		(g)	Exchange Act	4
		(h)	Form S-3	4
		(i)	SEC	4
		(j)	Series D Registrable Securities	4
		(k)	Series D’ Registrable Securities	4
		(l)	Special Registration Statement	4
		(m)	SVB	5
		(n)	SVB Warrants	5
		(o)	WKSI Shelf Registration Statement	5
		(p)	Other Definitions	5
	2.2	Request for Registration		5
	2.3	Piggyback Registrations		7
		(a)	Right to Terminate Registration	7

-i-

TABLE OF CONTENTS

(continued)

				Page
		(b)	Underwriting	7
		(c)	Expenses	8
	2.4	Form S-3 Registration		8
		(a)	Notice	9
		(b)	Registration	9
		(c)	Expenses	9
	2.5	Obligations of the Company		9
	2.6	Furnish Information		11
	2.7	Indemnification		11
		(a)	By the Company	11
		(b)	By Selling Holders	12
		(c)	Notice	12
		(d)	Contribution	13
		(e)	Underwriting Agreement	13
		(f)	Survival	13
	2.8	Rule 144 Reporting		13
	2.9	Termination of Registration Rights		14
	2.10	Limitations on Subsequent Registration Rights		14
	2.11	“Market Stand Off” Agreement		14
	2.12	S-3 Registration Requirements		15
3.	RIGHT OF FIRST OFFER			15
	3.1	General		15
	3.2	New Securities		15
	3.3	Procedures		16
	3.4	Failure to Exercise		17
	3.5	Termination		17
4.	COVENANTS OF THE COMPANY			17
	4.1	Vesting Schedule		17
	4.2	Board Visitation Rights		18
	4.3	Director Expenses		18

-ii-

TABLE OF CONTENTS

(continued)

				Page
	4.4	Proprietary Information and Inventions Agreement		18
	4.5	Audit		18
	4.6	Key-Man Insurance		19
	4.7	Employment Agreements		19
5.	ASSIGNMENT AND AMENDMENT			19
	5.1	Assignment		19
		(a)	Information and Inspection Rights	19
		(b)	Registration Rights; First Offer Rights	19
	5.2	Amendment of Rights		20
	5.3	New Investors		20
6.	GENERAL PROVISIONS			20
	6.1	Notices		20
	6.3	Entire Agreement		21
	6.4	Governing Law		21
	6.5	Severability		21
	6.6	Third Parties		21
	6.7	Successors and Assigns		21
	6.8	Captions		22
	6.9	Counterparts		22
	6.10	Costs and Attorneys’ Fees		22
	6.11	Adjustments for Stock Splits, Etc.		22
	6.12	Aggregation of Stock		22

Exhibit A	–	Series A Holders
Exhibit B	–	Series B-1 Holders
Exhibit C	–	Series C Holders
Exhibit D	–	Series D Holders
Exhibit E	–	Series D’ Holders
Exhibit F	–	Series E Holders
Exhibit G	–	Warrant Holders

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AMENDED AND RESTATED INVESTORS’ RIGHTS AGREEMENT

This Amended and Restated Investors’ Rights Agreement (this “Agreement”) is made and entered into as of December 10, 2007 by and among Danger, Inc., a Delaware corporation (the “Company”), Andrew E. Rubin, Matthew J. Hershenson and Joe F. Britt, Jr. (each, a “Founder” and, collectively, the “Founders”), the holders of the Company’s Series A Preferred Stock (the “Series A Preferred Stock”) set forth on Exhibit A hereto (the “Series A Holders”), the holders of the Company’s Series B-1 Preferred Stock (the “Series B-1 Preferred Stock”) set forth on Exhibit B hereto (the “Series B-1 Holders”), the holders of the Company’s Series C Preferred Stock (the “Series C Preferred Stock”) set forth on Exhibit C hereto (the “Series C Holders”), the holders of the Company’s Series D Preferred Stock (the “Series D Preferred Stock”) set forth on Exhibit D hereto (the “Series D Holders”), the holders of the Company’s Series D’ Preferred Stock (the “Series D’ Preferred Stock”) set forth on Exhibit E hereto (the “Series D’ Holders”), the holders of the Company’s Series E Preferred Stock (the “Series E Preferred Stock” and together with the Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock and Series D’ Preferred Stock, the “Preferred Stock”) set forth on Exhibit F hereto (the “Series E Holders” and together with the Series A Holders, Series B-1 Holders, Series C Holders, Series D Holders and Series D’ Holders, the “Investors”) and the holders of warrants to purchase shares of the Company’s Preferred Stock set forth on Exhibit G hereto (the “Warrant Holders”).

R E C I T A L S

WHEREAS, the Company, the Founders, the Series A Holders, Series B-1 Holders, Series C Holders, Series D Holders, Series D’ Holders, Series E Holders and certain of the Warrant Holders are parties to that certain Amended and Restated Investors’ Rights Agreement, dated as of October 2, 2006 (the “Prior Agreement”);

WHEREAS, the Company and the holders of (i) Series D’ Preferred Stock and/or (ii) Registrable Securities (as defined in the Prior Agreement) who have executed this Agreement (for and on behalf of all such holders of Series D’ Preferred Stock and/or Registrable Securities) wish to amend and restate the Prior Agreement in its entirety as set forth below; and

WHEREAS, the holders of at least a majority of the Registrable Securities (as defined in the Prior Agreement), together with the holders of at least a majority of the Series D’ Preferred Stock, have the right, pursuant to Section 5.2 of the Prior Agreement, to amend and restate the Prior Agreement in its entirety as set forth below.

NOW, THEREFORE, in consideration of the mutual agreements, covenants and considerations contained herein, the Company and the holders of (i) Series D’ Preferred Stock and/or (ii) Registrable Securities (as defined in the Prior Agreement) who have executed this Agreement (for and on behalf of all such holders of Series D’ Preferred Stock and/or Registrable Securities) hereby agree to amend and restate the Prior Agreement in its entirety as follows:

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1. INFORMATION RIGHTS

1.1 Financial Information. The Company covenants and agrees that, commencing on the date of this Agreement and for so long as any Investor holds at least 900,000 shares of the Common Stock issued or issuable upon conversion of the Preferred Stock (the “Preferred Conversion Stock”), the Company will:

(a) Annual Reports. Furnish to such Investor within ninety (90) days of the end of each fiscal year, an audited consolidated balance sheet as of the end of such fiscal year, an audited consolidated statement of operations and an audited consolidated statement of cash flows of the Company and its subsidiaries for such fiscal year, all prepared in accordance with generally accepted accounting principles by a “Big Four” accounting firm;

(b) Quarterly Reports. Furnish to such Investor within forty-five (45) days of the end of each fiscal quarter, quarterly unaudited consolidated financial statements, including an unaudited consolidated balance sheet, an unaudited consolidated statement of operations and an unaudited consolidated statement of cash flows, compared against the Plan (as defined below);

(c) Annual Budget. Furnish to such Investor quarterly financial statements compared against the Company’s annual operating plan (the “Plan”), as provided to and approved by the board of directors of the Company (the “Board”);

(d) Operating Plan. Furnish to such Investor, within thirty (30) days of the commencement of each calendar year, a copy of the Plan; and

(e) Other Information. Furnish to such Investor such other information, financial or other, that such Investor may reasonably request.

1.2 Inspection Rights. For so long as any Investor (together with its affiliates) holds at least 900,000 shares of Preferred Conversion Stock, the Company shall permit such Investor or its transferees (as permitted pursuant to Section 5.1(a) hereof), at such Investor’s expense, to visit and inspect the Company’s properties, to examine its books of account and records and to discuss the Company’s affairs, finances and accounts with its officers, all at such reasonable times as may be requested by such Investor; provided, however, that the Company shall not be obligated under this Section 1.2 to provide information that it deems in good faith to be a trade secret or similar confidential or proprietary information.

1.3 Termination of Certain Rights. The Company’s obligations under Sections 1.1 and 1.2 above will terminate upon the earlier of: (a) the closing of a firm commitment underwritten initial public offering of the Common Stock pursuant to an effective registration statement filed under the Securities Act of 1933, as amended (the “Securities Act”), in connection with which all outstanding shares of Preferred Stock are converted into Common Stock (a “Qualified IPO”) or (b) when the Company first becomes subject to the periodic reporting requirements of Sections 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or (c) the closing of an acquisition of the Company by another corporation or entity by a consolidation or merger in which the holders of the Company’s outstanding voting stock immediately prior to such transaction own, immediately after such transaction, securities representing less than 50% of the voting power of the corporation or other entity surviving such transaction.

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2. REGISTRATION RIGHTS.

2.1 Definitions. For purposes of this Agreement:

(a) Registration. The terms “register,” “registered” and “registration” refer to a registration effected by preparing and filing a registration statement or similar document pursuant to the Securities Act, and the declaration or ordering of effectiveness of such registration statement or document.

(b) Registrable Securities. The term “Registrable Securities” means: (i) shares of Preferred Conversion Stock other than any shares of Preferred Conversion Stock held by Heller or SVB, (ii) shares of Preferred Conversion Stock held by Heller by virtue of the Heller Warrants; provided, however, that such shares of Preferred Conversion Stock shall not be deemed Registrable Securities for purposes of Sections 2.2, 2.4 or 2.10, (iii) shares of Preferred Conversion Stock held by SVB by virtue of the SVB Warrants; provided, however, that such shares of Preferred Conversion Stock shall not be deemed Registrable Securities for purposes of Sections 2.2 or 2.10, (iv) shares of Common Stock held by the Founders; provided, however, that such shares of Common Stock shall not be deemed Registrable Securities for purposes of Sections 2.2, 2.4 or 2.10 and (v) any shares of Common Stock issued as (or issuable upon the conversion or exercise of any warrant, right or other security that is issued as) a dividend or other distribution with respect to, in exchange for or in replacement of any shares of Common Stock or Preferred Conversion Stock described in clauses (i)-(iv) of this subsection (b); provided, however, that no shares of Preferred Conversion Stock or other Common Stock shall be deemed Registrable Securities for purposes of this Agreement to the extent such shares of Preferred Conversion Stock or other Common Stock (1) have been sold, transferred or otherwise disposed of by a person in a transaction in which rights under this Section 2 are not assigned in accordance with this Agreement, (2) have been sold to the public through a Registration Statement or pursuant to Rule 144 promulgated under the Securities Act or (3) are held by a Holder whose rights to cause the Company to register securities pursuant to this Agreement have terminated in accordance with Section 2.9 of this Agreement.

(c) Registrable Securities Then Outstanding. The number of shares of “Registrable Securities then outstanding” shall mean the number of shares of Common Stock that are Registrable Securities and either (i) are then issued and outstanding or (ii) are then issuable pursuant to the exercise or conversion of then outstanding and then exercisable options, warrants or convertible securities.

(d) Heller. The term “Heller” means Heller Financial Leasing, Inc., a Delaware corporation.

(e) Heller Warrants. The term “Heller Warrants” means any warrants to purchase the Company’s capital stock which have been issued or hereinafter are issued to Heller in connection with that certain Master Lease Agreement, dated as of December 28, 2001, and any amendments thereto or extension thereof.

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(f) Holder. For purposes of Sections 2, 3 and 4 of this Agreement, the term “Holder” means any person owning of record Registrable Securities, or any assignee of record of such Registrable Securities to whom rights under Section 2 or Section 3 have been duly assigned in accordance with this Agreement; provided, however, that for purposes of this Agreement, (i) a record holder of shares of Preferred Stock convertible into Registrable Securities shall be deemed to be the Holder of such Registrable Securities (ii) a record holder of shares of Series D Preferred Stock convertible into such Series D Registrable Securities shall be deemed the Holder of such Series D Registrable Securities, and (iii) a record holder of shares of Series D’ Preferred Stock convertible into such Series D’ Registrable Securities shall be deemed the Holder of such Series D’ Registrable Securities; and provided, further, that the Company shall in no event be obligated to register shares of Preferred Stock, and the Holders of Registrable Securities will not be required to convert their shares of Preferred Stock into Common Stock in order to exercise the registration rights granted hereunder until immediately before the closing of the offering to which the registration relates (and then only to the extent necessary to sell the Registrable Securities to be sold in such offering).

(g) Exchange Act. The term “Exchange Act” means the Securities Exchange Act of 1934, as amended.

(h) Form S-3. The term “Form S-3” means Form S-3 under the Securities Act as in effect on the date hereof or any successor registration form under the Securities Act subsequently adopted by the SEC that permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC.

(i) SEC. The term “SEC” or “Commission” means the United States Securities and Exchange Commission.

(j) Series D Registrable Securities. The term “Series D Registrable Securities” shall mean the shares of Common Stock issued or issuable upon conversion of the Series D Preferred Stock and any shares of a security issued as (or issuable upon the conversion or exercise of any warrant, right or other security that is issued as) a dividend or other distribution with respect to, in exchange for or in replacement of any shares of Series D Preferred Stock.

(k) Series D’ Registrable Securities. The term “Series D’ Registrable Securities” shall mean the shares of Common Stock issued or issuable upon conversion of the Series D’ Preferred Stock and any shares of a security issued as (or issuable upon the conversion or exercise of any warrant, right or other security that is issued as) a dividend or other distribution with respect to, in exchange for or in replacement of any shares of Series D’ Preferred Stock.

(l) Special Registration Statement. The term “Special Registration Statement” shall mean (i) any registration statement relating to any employee benefit plan; (ii) with respect to any corporate reorganization or transaction under Rule 145 of the Securities Act, any registration statement related to the issuance or resale of securities issued in such a transaction; (iii) any registration statement related to stock issued upon conversion of debt securities; or (iv) any WKSI Shelf Registration Statement.

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(m) SVB. The term “SVB” means SVB Financial Group.

(n) SVB Warrants. The term “SVB Warrants” means any warrants to purchase the Company’s capital stock which have been issued or hereinafter are issued to Silicon Valley Bank and/or SVB in connection with that certain Loan and Security Agreement, dated as of October 12, 2007, and any amendments thereto or extension thereof.

(o) WKSI Shelf Registration Statement. The term “WKSI Shelf Registration Statement” shall mean a registration statement on Form S-3 under the Securities Act (or any successor form to Form S-3) which registration statement shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act (or any successor or similar rule under the Securities Act adopted by the Commission).

(p) Other Definitions. Capitalized terms not otherwise defined herein have the meanings set forth in that certain Series E Preferred Stock Purchase Agreement dated as of October 2, 2006 (the “Stock Purchase Agreement”).

2.2 Request for Registration.

(a) If the Company shall receive at any time after the earlier of (i) October 2, 2009, or (ii) six (6) months after the effective date of the first registration statement for a firm commitment underwritten public offering of the Company’s Common Stock, a written request from (A) the Holders of at least 20% of the Series D Registrable Securities and Series D’ Registrable Securities then outstanding, electing together as a single class, or (B) the Holders of at least 50% of the Registrable Securities then outstanding, that the Company file a registration statement under the Securities Act covering the registration of Registrable Securities and having an aggregate offering price of not less than $5,000,000, then the Company shall:

(i) within 30 days of the receipt thereof, give written notice of such request to all Holders; and

(ii) effect as soon as practicable, and in any event within 90 days of the receipt of such request, the registration under the Securities Act of all Registrable Securities that the Holders request to be registered, subject to the limitations of subsection 2.2(b).

(b) If the Holders initiating the registration request hereunder (the “Initiating Holders”) intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to subsection 2.2(a) and the Company shall include such information in the written notice referred to in subsection 2.2(a)(i). The underwriter will be selected by the Company within 10 days of giving the notice described in subsection 2.2(a)(i) and shall be reasonably acceptable to a majority in interest of the Initiating Holders. In such event, the right of any Holder to include his or her Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting (unless otherwise mutually agreed to by a majority in interest of the Initiating Holders and such Holder) to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Company as provided in

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subsection 2.5(e)) enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting. Notwithstanding any other provision of this Section 2.2, if the underwriter advises the Initiating Holders in writing that marketing factors require a limitation of the number of shares to be underwritten, then the Initiating Holders shall so advise all Holders of Registrable Securities which would otherwise be underwritten pursuant hereto, and the number of shares of Registrable Securities that may be included in the underwriting shall be allocated among all Holders thereof, including the Initiating Holders, in proportion (as nearly as practicable) to the amount of Registrable Securities owned by each Holder; provided, however, that the number of shares of Registrable Securities to be included in such underwriting shall not be reduced unless all other securities are first entirely excluded from the underwriting.

(c) Notwithstanding the foregoing, if the Company shall furnish to the Holders requesting a registration statement pursuant to this Section 2.2 a certificate signed by the Chief Executive Officer or President of the Company stating that in the good faith judgment of the Board it would be detrimental to the Company and its stockholders for such registration statement to be filed and it is therefore in the best interests of the Company to defer the filing of such registration statement, the Company shall have the right to defer taking action with respect to such filing for a period of not more than 90 days; provided, however, that the Company may not utilize this right more than once in any 12-month period.

(d) In addition, the Company shall not be obligated to effect, or to take any action to effect, any registration:

(i) with respect to a registration statement pursuant to Section 2.2(a)(A), if the Company has effected two registrations pursuant to Section 2.2(a)(A) and such registrations have been declared or ordered effective;

(ii) with respect to a registration statement pursuant to Section 2.2(a)(B), if the Company has effected two registrations pursuant to this Section 2.2(a)(B) and such registrations have been declared or ordered effective;

(iii) during the period starting with the date 90 days prior to the Board’s good faith estimate of the filing date of a registration statement (other than a registration statement relating to any employee benefit plan or to a corporate reorganization) (provided that notice of such estimated filing date is given to the Initiating Holders within 30 days of their request for registration) and ending on the date 180 days after the effective date of the first registration statement for a firm commitment underwritten public offering of the Company’s Common Stock or the date 90 days after the effective date of any other registration statement (other than a registration statements relating to any employee benefit plan or to a corporate reorganization); provided that the Company is actively employing in good faith reasonable efforts to cause such registration statement to become effective; or

(iv) if the Initiating Holders propose to dispose of shares of Registrable Securities that may be immediately registered on Form S-3 pursuant to a request made pursuant to Section 2.4 below.

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(e) The Company shall pay all expenses incurred in connection with each registration requested pursuant to this Section 2.2 (excluding underwriters’ or brokers’ discounts and commissions) including, without limitation, all filing, federal and “blue sky” registration and qualification fees, printers’ and accounting fees, the fees and expenses of counsel for the Company, and the reasonable fees and disbursements of one counsel for the selling Holder or Holders; provided, however, that the Company shall not be required to pay for any expenses of any registration proceeding begun pursuant to this Section 2.2 if the registration request is subsequently withdrawn at the request of the Holders of at least 50% of the Registrable Securities to be registered unless the registration is withdrawn because the Company disclosed information that is materially adverse to the Company or its stock price, in which case the Company will be required to pay such expenses.

2.3 Piggyback Registrations. The Company shall promptly notify all Holders of Registrable Securities in writing twenty (20) days prior to filing any registration statement under the Securities Act for purposes of effecting a public offering of securities of the Company (including, but not limited to, registration statements relating to secondary offerings of securities of the Company by selling stockholders, but excluding (i) Special Registration Statements, (ii) registration statements relating to any registration under Section 2.4 of this Agreement, and (iii) registrations on any form that does not include substantially the same information as would be required to be included in a registration statement covering the sale of the Registrable Securities) and will afford each such Holder an opportunity to include in such registration statement all or any part of the Registrable Securities then held by such Holder. Each Holder desiring to include in any such registration statement all or any part of the Registrable Securities held by such Holder shall, within 20 days after receipt of the above-described notice from the Company, so notify the Company in writing, and in such notice shall inform the Company of the number of Registrable Securities such Holder wishes to include in such registration statement. If a Holder decides not to include all of its Registrable Securities in any registration statement thereafter filed by the Company, such Holder shall nevertheless continue to have the right to include any Registrable Securities in any subsequent registration statement or registration statements as may be filed by the Company with respect to offerings of its securities, all upon the terms and conditions set forth herein. Any Holder who elects to include some or all of its Registrable Securities pursuant to this Section 2.3 shall cooperate with the Company in the preparation of any and all documents and instruments the Company reasonably deems necessary for the preparation of any applicable registration statement, and such Holders shall supply the Company with any and all information the Company reasonably deems necessary with respect to any registration statement.

(a) Right to Terminate Registration. The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 2.3 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration. The expenses of such withdrawn registration shall be borne by the Company in accordance with 2.3(c).

(b) Underwriting. If a registration statement for which the Company gives notice pursuant to this Section 2.3 is for an underwritten offering, then the Company shall so advise the Holders of Registrable Securities. In such event, the right of any Holder’s Registrable Securities to be included in a registration pursuant to this Section 2.3 shall be conditioned upon

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such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their Registrable Securities through such underwriting shall enter into an underwriting agreement in customary form with the managing underwriter or underwriter(s) selected for such underwriting. Notwithstanding any other provision of this Agreement, if the managing underwriter(s) determine(s) in good faith that marketing factors require a limitation of the number of shares to be underwritten, then the managing underwriter(s) may exclude shares (including Registrable Securities) from the registration and the underwriting but in no event shall the amount of securities of the selling Holders included in the offering be reduced below thirty percent (30%) of the total amount of securities included in such offering, unless such offering is the initial public offering of the Common Stock pursuant to an effective registration statement filed under the Securities Act (the “IPO”), in which case the selling stockholders may be excluded if the underwriters make the determination described above and no other stockholder’s securities are included. The number of shares that may be included in the registration and the underwriting shall be allocated first, to the Company and second, to the Holders requesting inclusion of their Registrable Securities in such registration on a pro rata basis based upon the total number of Registrable Securities then held by each such Holder; provided, however, that the right of the underwriters to exclude shares from the registration and underwriting as described above in this Section 2.3 shall be restricted so that all shares (i) that are not Registrable Securities and (ii) held by Founders, directors and employees of the Company, regardless of whether such shares are Registrable Securities, shall first be excluded from such registration and underwriting. If any Holder disapproves of the terms of any such underwriting, such Holder may elect to withdraw therefrom by written notice to the Company and the underwriter, delivered at least 20 business days prior to the effective date of the registration statement. Any Registrable Securities excluded or withdrawn from such underwriting shall be excluded and withdrawn from the registration. For any Holder that is a partnership or corporation, the partners, retired partners and shareholders of such Holder, or the estates and family members of any such partners, shareholders and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed to be a single “Holder,” and any pro rata reduction with respect to such “Holder” shall be based upon the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such “Holder,” as defined in this sentence.

(c) Expenses. All expenses incurred in connection with a registration pursuant to this Section 2.3 (excluding underwriters’ and brokers’ discounts and commissions) including, without limitation, all filing, federal and “blue sky” registration and qualification fees, printers’ and accounting fees, the fees and expenses of counsel for the Company, and the reasonable fees and disbursements of one counsel for the selling Holder or Holders shall be borne by the Company.

2.4 Form S-3 Registration. In the event the Company shall receive from any Holder or Holders of at least 25% of all Registrable Securities then outstanding a written request or requests that the Company effect a registration on Form S-3 and any related qualification or compliance with respect to all or a part of the Registrable Securities owned by such Holder or Holders, then the Company will:

8

(a) Notice. Promptly give written notice of the proposed registration and the Holder’s or Holders’ request therefor, and any related qualification or compliance, to all other Holders; and

(b) Registration. As soon as reasonably practicable, effect such registration and all such qualifications and compliances as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holder’s or Holders’ Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of any other Holder or Holders joining in such request as are specified in a written request given within 20 days after receipt of such written notice from the Company; provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance pursuant to this Section 2.4:

(i) if Form S-3 is not available for such offering by the Holders;

(ii) if the Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities (if any) at an aggregate price to the public of less than $1,000,000;

(iii) if the Company shall furnish to the Holders a certificate signed by the President of the Company stating that in the good faith judgment of the Board, it would be detrimental to the Company and its stockholders for such Form S-3 Registration to be effected at such time, in which event the Company shall have the right to defer the filing of the Form S-3 registration statement no more than twice during any 12-month period for a period of not more than 90 days, after receipt of the request of the Holder or Holders under this Section 2.4; or

(iv) after the Company has effected two registrations pursuant to this Section 2.4 in any twelve month period and such registrations have been declared or ordered effective.

(c) Expenses. The Company shall pay all expenses incurred in connection with each registration requested pursuant to this Section 2.4 (excluding underwriters’ or brokers’ discounts and commissions) including, without limitation, all filing, federal and “blue sky” registration and qualification fees, printers’ and accounting fees, the fees and expenses of counsel for the Company, and (in the case of the first three registrations under this Section 2.4) the reasonable fees and disbursements of one counsel for the selling Holder or Holders.

2.5 Obligations of the Company. Whenever required to effect the registration of any Registrable Securities under this Agreement, the Company shall, as expeditiously as reasonably possible:

(a) Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its reasonable efforts to cause such registration statement to become effective and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for until the earlier of (i) 120 successive days or (ii) such time as the distribution contemplated in the registration statement has been completed.

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(b) Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be reasonably necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement.

(c) Furnish to the Holders such number of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of the Registrable Securities owned by them that are included in such registration.

(d) Use its reasonable efforts to register and qualify the securities covered by such registration statement under such other securities or blue sky laws of such jurisdictions as shall be reasonably requested by the Holders, provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process or subject itself to taxation in any such states or jurisdictions.

(e) 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 managing underwriter(s) of such offering. Each Holder participating in such underwriting shall also enter into and perform its obligations under such an underwriting agreement.

(f) Cause all such Registrable Securities registered pursuant hereunder to be listed on each securities exchange on which similar securities issued by the Company are then listed.

(g) Provide a transfer agent and registrar for all Registrable Securities registered pursuant hereunder and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration.

(h) Notify each Holder covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event of which the Company becomes aware as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing.

(i) Furnish, at the request of any Holder requesting registration of Registrable Securities, on the date that such Registrable Securities are delivered to the underwriters for sale, if such securities are being sold through underwriters or, if such securities are not being sold through underwriters, on the date that the registration statement with respect to such securities becomes effective, (i) an opinion, dated as of such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, or if not underwritten, in form and substance as is customarily given to underwriters and reasonably satisfactory to counsel to the Holder offering the greatest number of Registrable Securities for sale in the registration, addressed to the

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underwriters, if any, and to the Holders requesting registration of Registrable Securities, and (ii) a “comfort” letter dated as of such date, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, or if not underwritten, in form and substance as is customarily given to underwriters and reasonably satisfactory to counsel to the Holder offering the greatest number of Registrable Securities for sale in the registration, addressed to the underwriters, if any, and to the Holders requesting registration of Registrable Securities.

2.6 Furnish Information. It shall be a condition precedent to the obligations of the Company to take any action pursuant to Sections 2.2, 2.3 or 2.4 that the selling Holders shall furnish to the Company such information regarding themselves, the Registrable Securities held by them and the intended method of disposition of such securities as shall be required to timely effect the registration of their Registrable Securities.

2.7 Indemnification. In the event any Registrable Securities are included in a registration statement under Sections 2.2, 2.3 or 2.4:

(a) By the Company. To the extent permitted by law, the Company will indemnify and hold harmless each Holder, the partners, officers and directors of each Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Exchange Act, against any losses, claims, damages or liabilities (joint or several) to which they may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (collectively a “Violation”):

(i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto;

(ii) the omission or alleged omission to state in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, a material fact required to be stated therein, or necessary to make the statements therein not misleading; or

(iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any federal or state securities law or any rule or regulation promulgated under the Securities Act, the Exchange Act or any federal or state securities law in connection with the offering covered by such registration statement;

and the Company will reimburse each such Holder or partner, officer, director, underwriter or controlling person or Affiliate of such Holders for any legal or other expenses reasonably incurred by them, in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the indemnity agreement contained in this subsection 2.7(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company, which

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consent shall not be unreasonably withheld or delayed, nor shall the Company be liable in any such case for any such loss, claim, damage, liability or action to the extent that it arises out of or is based upon a Violation that occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by such Holder, partner, officer, director, underwriter or controlling person of such Holder.

(b) By Selling Holders. To the extent permitted by law, each selling Holder will indemnify and hold harmless the Company, each of its directors, each of its officers who have signed the registration statement, each person, if any, who controls the Company within the meaning of the Securities Act, any underwriter and any other Holder selling securities under such registration statement or any of such other Holder’s partners, directors or officers or any person who controls such Holder within the meaning of the Securities Act or the Exchange Act, against any losses, claims, damages or liabilities (joint or several) to which the Company or any such director, officer, controlling person, underwriter or other such Holder, partner or director, officer or controlling person of such other Holder may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder expressly for use in connection with such registration; and each such Holder will reimburse any legal or other expenses reasonably incurred by the Company or any such director, officer, controlling person, underwriter or other Holder, partner, officer, director or controlling person of such other Holder in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the indemnity agreement contained in this subsection 2.7(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of such Holder, which consent shall not be unreasonably withheld or delayed; and provided, further, that the total amounts payable in indemnity by a Holder under this Section 2.7(b) in respect of any Violation shall not exceed the net proceeds received by such Holder in the registered offering out of which such Violation arises.

(c) Notice. Promptly after receipt by an indemnified party under this Section 2.7 of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 2.7, deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party (together with all other indemnified parties which may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing of interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if prejudicial to its ability to defend such action, shall relieve such indemnifying party of liability to the extent so prejudiced to the indemnified party under this Section 2.7, but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 2.7.

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(d) Contribution. In order to provide for just and equitable contribution to joint liability under the Securities Act in any case in which either (i) any Holder exercising rights under this Agreement, or any controlling person of any such Holder, makes a claim for indemnification pursuant to this Section 2.7 but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Section 2.7 provides for indemnification in such case, or (ii) contribution under the Securities Act may be required on the part of any such selling Holder or any such controlling person in circumstances for which indemnification is provided under this Section 2.7, then, and in each such case, the Company and such Holder will contribute to the aggregate losses, claims, damages or liabilities to which they may be subject (after contribution from others) in such proportion so that such Holder is responsible for the portion represented by the percentage that the public offering price of its Registrable Securities offered by and sold under the registration statement bears to the public offering price of all securities offered by and sold under such registration statement, and the Company and other selling Holders shall be responsible for the remaining portion; provided, however, that, in any such case, (A) no such Holder will be required to contribute any amount in excess of the net proceeds received by such Holder from the public offering price of all such Registrable Securities offered and sold by such Holder pursuant to such registration statement and (B) no person or entity guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any person or entity who was not guilty of such fraudulent misrepresentation.

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

(f) Survival. The obligations of the Company and Holders under this Section 2.7 shall survive the closing of the transactions contemplated hereby.

2.8 Rule 144 Reporting. With a view to making available the benefits of certain rules and regulations of the Commission that may at any time permit the sale of the Registrable Securities to the public without registration, after such time as the Company has become subject to the reporting requirements of the Exchange Act, the Company agrees to:

(a) make and keep public information available, as those terms are understood and defined in Rule 144 under the Securities Act, at all times after 90 days after the IPO, in accordance with the requirements of Rule 144(c), after the effective date of the first registration under the Securities Act filed by the Company for an offering of its securities to the general public;

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(b) use its reasonable efforts to file with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements); and

(c) so long as a Holder owns any Registrable Securities, furnish to such Holder forthwith upon request (i) a written statement by the Company as to its compliance with the reporting requirements of Rule 144 (at any time after 90 days after the effective date of the first registration statement filed by the Company for an offering of its securities to the general public) and of the Securities Act and the Exchange Act (at any time after it has become subject to the reporting requirements of the Exchange Act), (ii) a copy of the most recent annual or quarterly report of the Company and (iii) such other reports and documents of the Company as a Holder may reasonably request in availing itself of any rule or regulation of the Commission allowing a Holder to sell any such securities without registration (at any time after the Company has become subject to the reporting requirements of the Exchange Act).

2.9 Termination of Registration Rights. The rights to cause the Company to register securities under Section 2 of this Agreement (and to receive notices pursuant to Section 2 of this Agreement) shall terminate, with respect to each Holder, on the earlier of (i) the fifth anniversary of the date of the closing of the IPO, and (ii) with respect to each Holder, at such time following the closing of the IPO when all of such Holder’s Registrable Securities may be sold in any three-month period without registration pursuant to Rule 144 under the Securities Act.

2.10 Limitations on Subsequent Registration Rights. From and after the date of this Agreement, the Company shall not, without the prior written consent of the Holders of at least sixty-six and seven-tenths percent (66.7%) of the Registrable Securities then outstanding, enter into any agreement with any holder or prospective holder of any securities of the Company that would allow such holder or prospective holder to include such securities in any registration filed under Section 2.3 hereof, unless under the terms of such agreement such holder or prospective holder may include such securities in any such registration only to the extent that the inclusion of such securities will not reduce the amount of Registrable Securities of the Holders to be included.

2.11 “Market Stand Off” Agreement.

(a) Each Investor hereby agrees that, during the period of duration not to exceed 180 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of the first registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Securities Act, and, for a period of duration not to exceed 90 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of each subsequent registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Securities Act, it shall not, to the extent requested by the Company and such underwriter, directly or indirectly, sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound), or reduce its interest in (collectively, “Transfer”), any securities of the Company held by it at any time during such period except Common Stock included in such registration; provided, however, that all

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executive officers, directors and stockholders that hold one percent (1%) or more of the Common Stock (including on an as-converted basis any shares of Common Stock issuable upon the conversion or exercise of any share of Preferred Stock, warrant, right or other security) of the Company enter into similar agreements. Such restrictions, however, shall not be applicable to transfers to any affiliated entity of such Investor, including any affiliated corporation, partnership, limited partnership, limited liability company or investment fund, or to any stockholders, partners, general partners, limited partners and members of such Investor, in each case who agree in writing to be bound by this Agreement, including this Section 2.11.

(b) In order to enforce the foregoing covenants, the Company may impose stop transfer instructions with respect to the Registrable Securities of the Investors (and the shares or securities of every other person subject to the foregoing restriction) until the end of such period. Notwithstanding the foregoing, the obligations described in this Section 2.11 shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future, or to a registration relating solely to a Commission Rule 145 transaction.

2.12 S-3 Registration Requirements. Notwithstanding anything else contained in this Agreement, the Company shall not become obligated to become subject to the Exchange Act and, the Investors acknowledge, until such time as the Company becomes subject to the Exchange Act, the Company will be legally precluded from registering securities under a Form S-3 and, accordingly, no provisions in this Agreement to the contrary shall be deemed to require the Company to undertake such a registration until the Company legally is qualified to do so.

3. RIGHT OF FIRST OFFER.

3.1 General.

(a) Each Investor holding at least 900,000 shares of Preferred Stock and/or Common Stock issued or issuable upon the conversion thereof (each such Investor hereinafter referred to as a “Rights Holder”) has the right of first offer to purchase such Rights Holder’s Pro Rata Share (as defined below) of all (or any part) of any “New Securities” (as defined in Section 3.2) that the Company may from time to time issue after the date of this Agreement at the most favorable price and at the most favorable terms and conditions as the Company offers to any investor in connection with the offering of New Securities.

(b) A Rights Holder’s “Pro Rata Share” for purposes of this right of first offer is the ratio of (a) the number of Registrable Securities as to which such Rights Holder is the Holder (and/or is deemed to be the Holder under Section 2.1(d)) to (b) a number of shares of Common Stock equal to the sum of (i) the total number of shares of Common Stock then outstanding plus (ii) the total number of shares of Common Stock into which all then outstanding shares of Preferred Stock are then convertible plus (iii) the total number of shares of Common Stock available for issuance pursuant to equity incentive plans approved by the Board or upon the conversion of all other convertible securities.

3.2 New Securities. “New Securities” shall mean any Common Stock or Preferred Stock of the Company, whether now authorized or not, and rights, options or warrants to

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purchase such Common Stock or Preferred Stock, and securities of any type whatsoever, including notes or other debt instruments, that are, or may become, convertible or exchangeable into such Common Stock or Preferred Stock; provided, however, that the term “New Securities” does not include:

(a) shares of the Common Stock (and/or options or warrants therefor) issued or issuable to employees, officers, directors, contractors, advisors or consultants of the Company pursuant to stock options or other stock incentive agreements or plans approved by the Board and not primarily for equity financing purposes;

(b) any shares of Series E Preferred Stock issued on or after the date hereof pursuant to the terms of the Stock Purchase Agreement;

(c) any shares of Common Stock or other securities issuable upon conversion of or with respect to any then outstanding shares of Series A Preferred Stock, Series B-1 Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, Series D’ Preferred Stock or Series E Preferred Stock or Common Stock or other securities issuable upon conversion thereof;

(d) shares of Series D’ Preferred Stock (or Common Stock issued upon conversion thereof) issuable upon exercise of currently outstanding warrants;

(e) shares of Series D Preferred Stock (or Common Stock issued upon conversion thereof) issuable upon exercise of currently outstanding warrants;

(f) shares of Series C Preferred Stock (or Common Stock issued upon conversion thereof) issuable upon exercise of currently outstanding warrants;

(g) any shares of Common Stock or Preferred Stock (or any other security of the Company) issued in connection with any stock split or stock dividend;

(h) any securities offered by the Company to the public pursuant to a registration statement filed under the Securities Act;

(i) any securities issued pursuant to the acquisition of another corporation or entity by the Company by consolidation, merger, purchase of all or substantially all of the assets or other reorganization in which the Company acquires, in a single transaction or Series of related transactions, all or substantially all of the assets of such other corporation or entity, 50% or more of the voting power of such other corporation or entity, or 50% or more of the equity ownership of such other entity; or

(j) shares of any capital stock (and/or options or warrants therefor) issued to parties providing the Company with equipment leases, real property leases, loans, credit lines, guaranties of indebtedness, cash price reductions or similar financing or other strategic partners approved by the Board of Directors and not primarily for equity financing purposes.

3.3 Procedures. If the Company proposes to undertake an issuance of New Securities, it shall give written notice to each Rights Holder of its intention to issue New Securities (the “Notice”), describing the type of New Securities and the price and the general terms upon which

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the Company proposes to issue such New Securities. Each Rights Holder shall have thirty days from the date of mailing of any such Notice to agree in writing to purchase such Rights Holder’s Pro Rata Share of such New Securities for the price and upon the general terms specified in the Notice by giving written notice to the Company and stating therein the quantity of New Securities to be purchased (not to exceed such Rights Holder’s Pro Rata Share). Notwithstanding the terms set forth in the Notice, each Rights Holder shall have the right to pay cash for New Securities offered in the Notice. If any Rights Holder fails to so agree in writing within such thirty day period to purchase such Rights Holder’s full Pro Rata Share of an offering of New Securities (a “Nonpurchasing Holder”), then such Nonpurchasing Holder shall forfeit the right hereunder to purchase that part of its Pro Rata Share of such New Securities that it did not so agree to purchase and the Company shall promptly give each Rights Holder (if any) who has timely agreed to purchase its full Pro Rata Share of such offering of New Securities (a “Purchasing Holder”) written notice of the failure of any Nonpurchasing Holder to purchase such Nonpurchasing Rights Holder’s full Pro Rata Share of such offering of New Securities (the “Overallotment Notice”). Each Purchasing Holder shall have a right of overallotment such that such Purchasing Holder may agree to purchase a portion of the Nonpurchasing Holder’s unpurchased Pro Rata Share of such offering on a pro rata basis according to the relative Pro Rata Shares of the Purchasing Rights Holders at any time within five days after receiving the Overallotment Notice.

3.4 Failure to Exercise. If any Rights Holder fails to exercise in full the right of first offer within such thirty plus five day period, then the Company shall have 60 days thereafter to sell the New Securities with respect to which such Rights Holder’s rights of first offer hereunder were not exercised, at a price and upon general terms not materially more favorable to the purchasers thereof than specified in the Notice. If the Company has not issued and sold the New Securities within such 60 day period, then the Company shall not thereafter issue or sell any New Securities without again first offering such New Securities to the Rights Holders pursuant to this Section 3.

3.5 Termination. This right of first offer shall terminate (i) immediately before the closing of a Qualified IPO or (ii) upon (a) the acquisition of all or substantially all the assets of the Company or (b) an acquisition of the Company by another corporation or entity by consolidation or merger in which the holders of the Company’s outstanding voting stock immediately prior to such transaction own, immediately after such transaction, securities representing less than 50% or more of the voting power of the corporation or other entity surviving such transaction.

4. COVENANTS OF THE COMPANY.

4.1 Vesting Schedule. Unless the Board so authorizes, the Company shall not issue any shares of Common Stock directly or indirectly to its employees, either through equity compensation plans or otherwise, unless such shares of Common Stock are (a) subject to a vesting schedule, such that 25% of the shares of Common Stock so issued would vest on the one-year anniversary of the date of issuance or vesting commencement date, as applicable, with the balance vesting in thirty-six (36) equal monthly installments thereafter, thereby totaling a four-year vesting schedule and (b) subject to a right of first refusal in favor of the Company in the event of transfer. The covenants in this Section 4.1 shall terminate upon a Qualified IPO.

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4.2 Board Visitation Rights. The parties hereto hereby agree that unless the Company’s Board of Directors determines, in its sole discretion, that it would be inappropriate to do so for reasons of confidentiality or potential conflicts of interest, the Company shall invite one representative designated by Mobius Venture Capital, one representative designated by Venture Strategy Partners, one representative designated by T Venture, one representative designated by SOFTBANK Capital Partners, one representative designated by Institutional Venture Partners X, L.P., one representative designated by Adams Street V, L.P., one representative designated by Motorola, Inc. from its venture division and Matthew J. Hershenson (each an “Observer” and together, the “Observers”) to attend all meetings of its Board of Directors in a nonvoting observer capacity and, in this respect, shall give the Observers copies of all notices, minutes, consents, and other non-confidential material that it provides to its directors. The Observers may participate in discussions of matters brought to the Board of Directors; provided, however, that such Observers agree (i) to hold in confidence and trust and not use or disclose any confidential information provided to or learned by them in connection with their rights under this Agreement, and (ii) that the Observers may be excluded from, and shall not be delivered written information with respect to, any portion of a meeting of the Board of Directors in which management intends to disclose confidential business information regarding (a) product strategy, pricing, technology, customer relationships or similar matters if a majority of the Board of Directors determines, in advance of such meeting, that the disclosure of such information to the Observers would be detrimental to the Company’s business, or (b) joint marketing arrangements, joint development projects, mergers, acquisitions, joint ventures or strategic alliances if a majority of the Board of Directors determines that disclosure of such information to the Observers would be detrimental to the Company’s business. In the event a representative of T Venture is appointed to the Board of Directors to fill the seat of the Deutsche Telekom Director, as defined in the Company’s Amended and Restated Voting Agreement, dated as of the date hereof, the Company’s obligation to invite a T Venture Observer shall terminate. Mr. Hershenson’s rights under this Section 4.2 shall terminate in the event Mr. Hershenson is employed (either on a full, part time or consulting basis), by a competitor of the Company, as determined by the Board in good faith and in its sole discretion.

4.3 Director Expenses. The Company shall reimburse the directors elected by a majority of the Series A Preferred Stock, a majority of the Series B-1 Preferred Stock and Series C Preferred Stock and the Series D Preferred Stock, and the Observers (the “Representatives”) for the reasonable out-of-pocket travel expenses incurred by the Representatives in connection with the attendance of meetings of the Company’s Board of Directors (and only for the Company’s portion of such expenses in the event such expenses are allocable to other board meetings or business matters of a Representative). Other authorized expenses of the Representatives shall be reimbursed in accordance with the Company’s expense reimbursement policy.

4.4 Proprietary Information and Inventions Agreement. The Company will cause each person now or hereafter employed by it or any subsidiary with access to confidential information to enter into a proprietary information and inventions agreement substantially in the form approved by the Board of Directors.

4.5 Audit. The Company shall continue to retain a “Big Four” accounting firm which shall certify the Company’s financial statements at the end of each fiscal year. In the event the

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services of the “Big Four” firm so selected, or any “Big Four” firm hereafter employed by the Company is terminated, the Company will promptly thereafter notify the Holders and will request the “Big Four” firm whose services are terminated to deliver to the Holders a letter from such firm setting forth the reasons for the termination of their services. In the event of such termination, the Company will promptly thereafter engage another “Big Four” firm. In its notice to the Holders the Company shall state whether the change of accountants was recommended or approved by the Board of Directors of the Company or any committee thereof.

4.6 Key-Man Insurance. The Company shall maintain term life insurance policies, payable to the Company, on the lives of the Joe F. Britt, Jr. and Matthew J. Hershenson, each in the amount of $1,000,000.

4.7 Employment Agreements. The Company will cause certain of its key employees (each, a “Key Employee”) to be bound by employment agreements which: (i) restrict a Key Employee’s ability to compete with the Company during the term of their employment, (ii) bars each Key Employee from holding any ownership interest in any competitor of the Company, except for de minimis holdings in competitors that are publicly traded on a national stock exchange, (iii) prohibit a Key Employee from soliciting or hiring any persons then employed by the Company, for up to one year following the cessation of such Key Employee’s employment with the Company, or (iv) prohibit a Key Employee from disclosing confidential information of the Company.

4.8 Termination of Covenants. The covenants in this Section 4 shall terminate (i) immediately before the closing of a Qualified IPO or (ii) upon (a) the acquisition of all or substantially all the assets of the Company or (b) an acquisition of the Company by another corporation or entity by consolidation or merger in which the holders of the Company’s outstanding voting stock immediately prior to such transaction own, immediately after such transaction, securities representing less than 50% or more of the voting power of the corporation or other entity surviving such transaction.

5. ASSIGNMENT AND AMENDMENT.

5.1 Assignment. Notwithstanding anything herein to the contrary:

(a) Information and Inspection Rights. The rights of the Investors under Section 1.1 or 1.2 hereof may be assigned only to a transferee who acquires from the Investors (or the Investors’ permitted assigns) at least 900,000 shares of Preferred Conversion Stock.

(b) Registration Rights; First Offer Rights. The rights of a Holder under Section 2 and Section 3 hereof may be assigned only with and pursuant to a transfer of Registrable Securities to: (i) any direct or indirect partner or retired partner of any such Holder or Rights Holder that is a partnership; (ii) any family member or trust for the benefit of any Holder or Rights Holder who is an individual; (iii) any member or former member of a holder which is a limited liability company; (iv) any corporation, limited liability company, limited partnership or other entity that merges with, acquires all, or substantially all, of the assets of, or otherwise is the successor to the business of, a Holder or Rights Holder, or to any other entity that is the survivor entity in any reorganization involving a Holder or Rights Holder; (v) any

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Holder holding at least 1,500,000 shares of Registrable Securities as of the date of this Agreement; (vi) a transferee who acquires from one or more Holders (or the Holders’ permitted assigns) at least 1,500,000 shares of Preferred Conversion Stock and (vii) to the extent not included above, any affiliate of a Holder or Rights Holder, including, without limitation, any affiliated corporation, partnership, limited partnership, limited liability company, investment fund or to any stockholders, partners, general partners, limited partners and members of such Holder or Rights Holder; provided, however, that no party may be assigned any of the foregoing rights unless the Company is given written notice by the assigning party at the time of such assignment stating the name and address of the assignee and identifying the securities of the Company as to which the rights in question are being assigned; provided, further, that any such assignee shall receive such assigned rights subject to all the terms and conditions of this Agreement, including without limitation the provisions of this Section 5.

5.2 Amendment of Rights. Unless otherwise provided for herein, any provision of this Agreement may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of the Company and the holders of at least a majority of the Registrable Securities then outstanding; provided, however, that (i) any amendment or waiver which would have the effect of removing any rights applicable to the Series D’ Preferred Stock shall require the approval of the holders of at least a majority of the Series D’ Preferred Stock then outstanding (it being understood and agreed that upon conversion of all outstanding shares of Series D’ Preferred Stock to Common Stock, this clause (i) shall terminate in its entirety and shall have no further force or effect); and (ii) Section 4.2 shall not be amended to remove or adversely affect the rights of any of the named parties therein, without the prior written consent of such named party. Any amendment or waiver effected in accordance with this Section 5.2 shall be binding upon each Investor, Holder and Rights Holder, each permitted successor or assignee of each Investor, Holder or Rights Holder, and the Company.

5.3 New Investors. Notwithstanding anything herein to the contrary, if additional parties purchase shares of Series E Preferred Stock, then such new investors shall become a party to this Agreement as “Investors” and “Holders” hereunder, without the need for any consent, approval or signature of any other Investor, Holder or any Founder when such new investor has purchased shares of Series E Preferred Stock, paid the Company all consideration payable for such shares and executed a counterpart signature page to this Agreement.

6. GENERAL PROVISIONS.

6.1 Notices. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given when personally delivered or five days after deposit in the U.S. mail by registered or certified mail, return receipt requested, postage prepaid, as follows:

(a) if to the Investors, at the addresses set forth on the signature pages hereto.

(b) if to the Company, at 3101 Park Blvd., Palo Alto, CA 94306, Attn: Chief Executive Officer; with a copy, which shall not constitute notice, to Cooley Godward LLP, Attn: Mark Tanoury, Five Palo Alto Square, 3000 El Camino Real, Palo Alto, CA 94306.

(c) if to the Founders, at the addresses set forth on the signature pages hereto.

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Any party hereto (and such party’s permitted assigns) may by notice so given change its address for future notices hereunder by giving ten days’ advance notice to all other parties. Notice shall conclusively be deemed to have been given when personally delivered or when deposited in the mail in the manner set forth above.

6.2 Legends. Each certificate representing Registrable Securities shall be stamped or otherwise imprinted with legends substantially similar to the following:

THE SALE, PLEDGE, HYPOTHECATION OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT BY AND BETWEEN THE STOCKHOLDER AND THE COMPANY. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY.

6.3 Entire Agreement. This Agreement, together with all the exhibits hereto, constitutes and contains the entire agreement and understanding of the parties with respect to the subject matter hereof and supersedes any and all prior negotiations, correspondence, agreements, understandings, duties or obligations between the parties respecting the subject matter hereof, including, without limitation, the Prior Agreement, and no party shall be liable or bound to in any other manner by any representations, warranties, covenants and agreements except as specifically set forth herein and therein.

6.4 Governing Law. This Agreement shall be governed by and construed exclusively in accordance with the internal laws of the State of California as applied to agreements among California residents entered into and to be performed entirely within California, excluding that body of law relating to conflict of laws and choice of law. Each of the parties irrevocably and unconditionally waives to the fullest extent permitted by law, any and all rights to a trial by jury in connection with any litigation arising out of or relating to this Agreement or the transactions contemplated hereby

6.5 Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, then such provision(s) shall be excluded from this Agreement and the balance of this Agreement shall be interpreted as if such provision(s) were so excluded and shall be enforceable in accordance with its terms.

6.6 Third Parties. Nothing in this Agreement, express or implied, is intended to confer upon any person, other than the parties hereto and their successors and assigns, any rights or remedies under or by reason of this Agreement.

6.7 Successors and Assigns. Subject to the provisions of Section 5, the provisions of this Agreement shall inure to the benefit of, and shall be binding upon, the successors and permitted assigns of the parties hereto. Notwithstanding anything in this Agreement to the contrary but subject to the provisions of Section 5, each Investor may assign its rights and

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delegate its obligations hereunder in connection with a transfer of Registrable Securities, in whole or in part, to any affiliate of such Investor, including, without limitation, any affiliated corporation, partnership, limited partnership, limited liability company or investment fund, or to any stockholders, partners, general partners, limited partners and members of such Investor.

6.8 Captions. The captions to sections of this Agreement have been inserted for identification and reference purposes only and shall not be used to construe or interpret this Agreement.

6.9 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

6.10 Costs and Attorneys’ Fees. If any action, suit or other proceeding is instituted concerning or arising out of this Agreement or any transaction contemplated hereunder, the prevailing party shall recover all of such party’s costs and attorneys’ fees incurred in each such action, suit or other proceeding, including any and all appeals or petitions therefrom.

6.11 Adjustments for Stock Splits, Etc. Wherever in this Agreement there is a reference to a specific number of shares of Common Stock or Preferred Stock of any class or series, then, upon the occurrence of any subdivision, combination or stock dividend of such class or series of stock, the specific number of shares so referenced in this Agreement shall automatically be proportionally adjusted to reflect the effect on the outstanding shares of such class or series of stock by such subdivision, combination or stock dividend.

6.12 Aggregation of Stock. All shares held or acquired by affiliated entities or persons shall be aggregated together for the purpose of determining the availability of any rights under this Agreement.

6.13 Amendment and Restatement of Prior Agreement. The Prior Agreement is hereby amended in its entirety and restated herein. Such amendment and restatement is effective upon the execution of this Agreement by (i) the Company, (ii) the holders of at least a majority of the Registrable Securities (as defined in the Prior Agreement) outstanding as of the date of this Agreement, and (iii) the holders of at least a majority of the Series D’ Preferred Stock outstanding as of the date of this Agreement. Upon such execution, all provisions of, rights granted and covenants made in the Prior Agreement are hereby waived, released and superseded in their entirety and shall have no further force or effect.

[Remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date and year first above written.

COMPANY:
DANGER, INC.
By:	/s/ Henry R. Nothhaft
	Henry R. Nothhaft
	Chairman and Chief Executive Officer

[SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT]

FOUNDERS
By:
	Andrew E. Rubin
Address:	[address]
	[address]
By:	/s/ Matthew J. Hershenson
	Matthew J. Hershenson
Address:	[address]
	[address]
JOE FREEMAN BRITT, JR., OR HIS SUCCESSOR,
AS TRUSTEE OF THE JOE FREEMAN BRITT, JR.
REVOCABLE LIVING TRUST CREATED UTA
DATED MAY 30, 2003, AS AMENDED
/s/ Joe Freeman Britt, Jr.
Joe Freeman Britt, Jr., Trustee
Address:	[address]
	[address]

[SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT]

INVESTORS:
SOFTBANK Capital Partners LP
By:	SOFTBANK Capital Partners LLC, its
	General Partner
By:	/s/ Steven J. Murray
Name:	Steven J. Murray
Title:	Administrative Member
Address:	1188 Centre Street
	Newton Center, MA 02459
SOFTBANK Capital Advisors Fund LP
By:	SOFTBANK Capital Partners LLC, its
	General Partner
By:	/s/ Steven J. Murray
Name:	Steven J. Murray
Title:	Administrative Member
Address:	1188 Centre Street
	Newton Center, MA 02459
SOFTBANK Capital LP
By:	SOFTBANK Capital Partners LLC, its
	General Partner
By:	/s/ Steven J. Murray
Name:	Steven J. Murray
Title:	Administrative Member
Address:	1188 Centre Street
	Newton Center, MA 02459

[SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT]

Meritech Capital Partners II L.P.
By:	Meritech Capital Associates II L.L.C.,
	its General Partner
By:	Meritech Management Associates II L.L.C.,
	a managing member
By:	/s/ Paul S. Madera
	Paul S. Madera, a managing member
Address:	245 Lytton Avenue, Suite 350
	Palo Alto, CA 94301
Meritech Capital Affiliates II L.P.
By:	Meritech Capital Associates II L.L.C.,
	its General Partner
By:	Meritech Management Associates II L.L.C.,
	a managing member
By:	/s/ Paul S. Madera
	Paul S. Madera, a managing member
Address:	245 Lytton Avenue, Suite 350
	Palo Alto, CA 94301
MCP Entrepreneur Partners II L.P.
By:	Meritech Capital Associates II L.L.C.,
	its General Partner
By:	Meritech Management Associates II L.L.C.,
	a managing member
By:	/s/ Paul S. Madera
	Paul S. Madera, a managing member
Address:	245 Lytton Avenue, Suite 350
	Palo Alto, CA 94301

[SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT]

Redpoint Ventures II, L.P., by its
General Partner Redpoint Ventures II, LLC
Redpoint Associates II, LLC, as nominee
Redpoint Technology Partners Q-I, L.P., by its
General Partner Redpoint Ventures I, LLC
Redpoint Technology Partners A-I, L.P., by its
General Partner Redpoint Ventures I, LLC
By:	/s/ Jeffrey Brody
	, Managing Director
Address:	3000 Sand Hill Road
	Bldg 2, Suite 290
	Menlo Park, CA 94025

[SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT]

Mobius Technology Ventures VI, L.P.
SOFTBANK U.S. Ventures Fund VI, L.P.
Mobius Technology Ventures Advisors Fund VI, L.P.
Mobius Technology Ventures Side Fund VI, L.P.
Each by: Mobius VI LLC, General Partner
By:	/s/ Greg Galanos
Name:	Greg Galanos
Title:	Managing Director
Address:	1050 Walnut Street, Suite 210
	Boulder, CO 80302

[SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT]

Venture Strategy Partners II LP
By:	Venture Strategy Management Company II LLC
Its:	General Partner
By:	/s/ Joanna Rees
	Joanna Rees
	Managing Member
Address:	201 Post Street, Suite 1100
	San Francisco, CA 94108
Venture Strategy Affiliates Fund LP
By:	Venture Strategy Management Company II LLC
Its:	General Partner
By:	/s/ Joanna Rees
	Joanna Rees
	Managing Member
Address:	201 Post Street, Suite 1100
	San Francisco, CA 94108

[SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT]

T-Mobile Venture Fund GmbH & Co. KG
By:	/s/ Axel Kolb	/s/ ppa. Schenkel
Title:	Dr. Axel Kolb	Norbert Schenkel
	Managing Director	Senior Manager Controlling
Address:	Gotenstr. 156
	53175 Bonn
	Germany

[SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT]

EXHIBIT A

Series A Holders

1. Mobius Technology Ventures VI, L.P.

2. SOFTBANK U.S. Ventures Fund VI L.P.

3. Mobius Technology Ventures Advisors Fund VI L.P.

4. Mobius Technology Ventures Side Fund VI L.P.

5. AmidZad, LLC

6. Peter T. Barrett

7. Christopher M. White

8. Joe F. Britt, Jr.

9. John Matheny and Lyne Plamondon

10. Bruce Leak

11. Stewart Alsop

12. Ed Taylor

13. Zarko Draganic

14. Konstantin Othmer

15. GC & H Investments

16. Brobeck, Phleger & Harrison LLP

Exhibit A – Page 1

EXHIBIT B

Series B-1 Holders

1. Redpoint Ventures II, L.P.

2. Redpoint Associates II, LLC

3. Redpoint Technology Partners Q-I, L.P.

4. Redpoint Technology Partners A-I, L.P.

5. Mobius Technology Ventures VI, L.P.

6. SOFTBANK U.S. Ventures Fund VI, L.P.

7. Mobius Technology Ventures Advisors Fund VI, L.P.

8. Mobius Technology Ventures Side Fund VI, L.P.

9. T-Mobile Venture Fund GmbH & Co.KG

10. 2. T-Telematik Venture Beteiligungsgesellschaft mbh

11. inOvate Communications Group, LLC

12. WireFree Services Belgium S.A., London Branch

13. Diamondhead Ventures, L.P.

14. Diamondhead Ventures Advisory Fund, L.P.

15. Diamondhead Ventures Principals Fund, L.P.

Exhibit B – Page 1

EXHIBIT C

Series C Holders

1. Redpoint Ventures II, L.P.

2. Redpoint Associates II, LLC

3. Redpoint Technology Partners Q-I, L.P.

4. Redpoint Technology Partners A-I, L.P.

5. Mobius Technology Ventures VI, L.P.

6. SOFTBANK U.S. Ventures Fund VI, L.P.

7. Mobius Technology Ventures Advisors Fund VI, L.P.

8. Mobius Technology Ventures Side Fund VI, L.P.

9. T-Mobile Venture Fund GmbH & Co.KG

10. inOvate Communications Group, LLC

11. WireFree Services Belgium S.A., London Branch

12. Diamondhead Ventures, L.P.

13. Diamondhead Ventures Advisory Fund, L.P.

14. Diamondhead Ventures Principals Fund, L.P.

15. Heller Financial Leasing, Inc.

16. Venture Strategy Partners II, L.P.

17. Venture Strategy Affiliates Fund, L.P.

Exhibit C – Page 1

EXHIBIT D

Series D Holders

1. SOFTBANK Capital Partners LP

2. SOFTBANK Capital Advisors Fund LP

3. SOFTBANK Capital LP

4. Meritech Capital Partners II LP

5. Meritech Capital Affiliates II LP

6. MCP Entrepreneur Partners II L.P.

7. Redpoint Ventures II, L.P.

8. Redpoint Associates II, LLC

9. Mobius Technology Ventures VI, L.P.

10. SOFTBANK U.S. Ventures Fund VI, L.P.

11. Mobius Technology Ventures Advisors Fund VI, L.P.

12. Mobius Technology Ventures Side Fund VI, L.P.

13. Diamondhead Ventures, L.P.

14. Diamondhead Ventures Advisory Fund, L.P.

15. Diamondhead Ventures Principals Fund, L.P.

16. Venture Strategy Partners II, L.P.

17. Venture Strategy Affiliates Fund, L.P.

18. Ohana Holdings, LLC

19. T-Mobile Venture Fund GmbH & Co.KG

Exhibit D – Page 1

EXHIBIT E

Series D’ Holders

1. SOFTBANK Capital Partners LP

2. SOFTBANK Capital Advisors Fund LP

3. SOFTBANK Capital LP

4. Meritech Capital Partners II LP

5. Meritech Capital Affiliates II LP

6. MCP Entrepreneur Partners II L.P.

7. Redpoint Ventures II, L.P.

8. Redpoint Associates II, LLC

9. Mobius Technology Ventures VI, L.P.

10. SOFTBANK U.S. Ventures Fund VI, L.P.

11. Mobius Technology Ventures Advisors Fund VI, L.P.

12. Mobius Technology Ventures Side Fund VI, L.P.

13. Diamondhead Ventures, L.P.

14. Diamondhead Ventures Advisory Fund, L.P.

15. Diamondhead Ventures Principals Fund, L.P.

16. Venture Strategy Partners II, L.P.

17. Venture Strategy Affiliates Fund, L.P.

18. T-Mobile Venture Fund GmbH & Co.KG

19. Institutional Venture Partners X, L.P.

20. Institutional Venture Partners X GmbH & Co. Beteiligungs KG

21. Function Engineering

22. Sung Kim

23. Adams Street V, L.P.

24. Motorola, Inc.

Exhibit E – Page 1

EXHIBIT F

Series E Holders

1. Sharp Corporation

2. ATEL Ventures, Inc., as Trustee

Exhibit F – Page 1

EXHIBIT G

Warrant Holders

1. Heller Financial Leasing, Inc

2. SVB Financial Group

Exhibit G – Page 1

EX-4.4

EXHIBIT 4.4

NEITHER THIS WARRANT (THE “WARRANT”) NOR THE SHARES OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). NO SALE, TRANSFER OR OTHER DISPOSITION OF THIS WARRANT OR SAID SHARES MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR (ii) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED, EXCEPT THAT NO SUCH OPINION SHALL BE REQUIRED IF SUCH SALE IS PURSUANT TO RULE 144 PROMULGATED UNDER THE ACT.

WARRANT

TO PURCHASE

SHARES OF SERIES B-1 PREFERRED STOCK

THIS CERTIFIES THAT, for good and valuable consideration received from Heller Financial Leasing, Inc. (“Warrantholder”), Warrantholder is entitled to subscribe for and purchase 68,512 of Preferred shares (as adjusted pursuant to provisions hereof, the “Shares”) of the fully paid and non-assessable Series B-1 Preferred Stock (the “Preferred Stock”) of Danger, Inc., a Delaware corporation with its principal place of business at 124 University Avenue, Palo Alto, CA 94301 (the “Company”), at an exercise price per share as determined pursuant to Section 1 hereof (such price and such other price as shall result, from time to time, from adjustments specified herein, is hereafter referred to as the “Exercise Price”), subject to the provisions and upon the terms and conditions hereinafter set forth. As used herein, the term “Preferred Stock” shall mean the Company’s presently authorized Series B-1 Preferred Stock, and any stock into or for which such Series B-1 Preferred Stock may hereafter be converted or exchanged pursuant to the Certificate of Incorporation of the Company as from time to time amended as provided by law and in such Certificate. As used herein, the term “Grant Date” shall mean January 25, 2002. The Company acknowledges that the cash consideration paid by Warrantholder for this Warrant is $10.00 for income tax purposes, and that this Warrant is issued in connection with that certain financial accommodation entered into by and between Company as the obligor and Warrantholder as the obligee thereunder (the “Financing Arrangement”).

In the event that all of the Preferred Stock is converted into Common Stock, this Warrant shall be exercisable solely for such Common Stock, and any reference throughout this Warrant to shares of Preferred Stock shall be deemed to refer to the shares of Common Stock into which the Preferred Stock may be converted.

1. Term and Exercise Price.

(a) Term. The purchase rights represented by this Warrant are exercisable, in whole or in part, at any time and from time to time, from and after the initial occurrence of a Pricing Event (as defined herein) until the seventh (7^th) anniversary of the Grant Date.

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(b) Exercise Price. The Exercise Price may be adjusted from time to time upon the occurrence of the following events (each such event, a “Pricing Event”):

(i) Liquidity Event. If a Liquidity Event (as defined below) occurs at any time between the Grant Date and July 31, 2002 and an event described in Section 1(b)(ii) or Section 1(b)(iii) has not occurred, the Exercise Price shall equal the sum of $1.4596 per share plus the product of (a) the difference between (i) the value of the consideration payable in the Liquidity Event on a share of Preferred Stock and (ii) $1.4596, multiplied by (b) the fraction resulting from dividing (i) the number of days between the Grant Date and the date of the Liquidity Event by (ii) the number of days between July 20, 2001 and the date of the Liquidity Event. “Liquidity Event” shall mean (i) a consolidation or merger of the Company with or into another corporation or entity (other than a merger with another corporation or entity in which the Company is the surviving corporation and which does not result in any reclassification or change of outstanding securities issuable upon exercise of this Warrant), (ii) a sale of all or substantially all of the Company’s assets or (iii) a sale of the Company’s Common Stock in a firmly underwritten initial public offering, pursuant to an effective registration statement under the Act.

(ii) Aborted Series B-2 Financing. If a closing of the sale of the Company’s Series B-2 Preferred Stock, at a price per share of $2.5218, does not occur prior to July 31, 2002 (an “Aborted B-2 Financing”), the Exercise Price shall be $1.4596. If at any time following the Aborted B-2 Financing but prior to the expiration of the Warrant, the Company completes a subsequent bona fide round of equity financing (the “Next Round Financing”), the Exercise Price shall be adjusted to equal the sum of $1.4596 per share plus the product of (a) the difference between (i) the per share price of the class or series of equity security issued in connection with the Next Round Financing (the “Next Round Stock”) and (ii) $1.4596, multiplied by (b) the fraction resulting from dividing (i) the number of days between the Grant Date and the date of the Next Round Financing by (ii) the number of days between July 20, 2001 and the date of the Next Round Financing.

(iii) Completed Series B-2 Financing. If a closing of the sale of the Company’s Series B-2 Preferred Stock, at a price per share of $2.5218, occurs prior to July 31, 2002 (a “Completed B-2 Financing”) then the Exercise Price shall be $2.5218. If at any time following the Completed B-2 Financing but prior to the expiration of the Warrant, the Company completes a Next Round Financing, the Exercise Price shall be adjusted to equal the sum of $2.5218 per share plus the product of (a) the difference between (i) the per share price of the class or series of equity security issued in connection with the Next Round Financing (the “Next Round Stock”) and (ii) $2.5218, multiplied by (b) the fraction resulting from dividing (i) the number of days between the Grant Date and the date of the Next Round Financing by (ii) the number of days between July 31, 2002 and the date of the Next Round Financing.

2. Method of Exercise; Net Issue Exercise.

2.1 Method of Exercise; Payment; Issuance of New Warrant. The purchase rights represented by this Warrant may be exercised by the Warrantholder, in whole or in part and from time to time, by the surrender of this Warrant (with the notice of exercise form attached hereto as

2

Exhibit A duly executed) at the principal office of the Company and by the payment to the Company of an amount equal to the then applicable Exercise Price per share multiplied by the number of Shares then being purchased. The Warrantholder shall be deemed to have become the holder(s) of record of, and shall be treated for all purposes as the record holder(s) of, the Shares represented thereby (and such Shares shall be deemed to have been issued) immediately prior to the close of business on the date or dates upon which this Warrant is exercised. In the event of any exercise of the rights represented by this Warrant, certificates for the Shares so purchased shall be promptly delivered to the holder hereof as soon as practicable (and in any event within 20 business days of receipt of such notice) and, unless this Warrant has been fully exercised or expired, a new Warrant representing the portion of the Shares, if any, with respect to which this Warrant may thereafter be exercised shall also be issued to the holder hereof as soon as practicable (and in any event within such 20 business day period).

2.2 Non-Cash Exercise.

(a) In lieu of payment in cash, the rights represented by this Warrant may also be exercised by a written notice of exercise in the form of Annex A attached hereto, providing for the non-cash exercise of this Warrant for the Shares equal to the value (as determined below) of this Warrant (or the portion thereof being exercised), specifying that this non-cash exercise election has been made, and the net number of Shares to be issued after giving effect to such non-cash exercise. In the event the Warrantholder makes such election, Company shall issue to the holder a number of shares computed using the following formula:

X	=	Y (A – B)
		A

Where:

X	=	the number of Shares to be issued to the holder
Y	=	the number of Shares purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised (as of the date of such non-cash exercise)
A	=	the Fair Market Value of one Share of Preferred Stock (as of the date of such non-cash exercise)
B	=	Exercise Price of one Share of Preferred Stock (as adjusted to the date of such non-cash exercise)

(b) For purposes of this Section 2.2, the “Fair Market Value” of one share of the Company’s Preferred Stock shall be equal to the number of shares of Common Stock into which each share of Preferred Stock is convertible as of the date of the exercise, multiplied by the “Fair Market Value” of a share of Common Stock (as determined pursuant to this Section 2.2). The “Fair Market Value” of one share of the Company’s Common Stock shall be equal to either (i) if the exercise of this Warrant occurs in connection with an initial public offering of the Company, the “initial price to public” specified in the final prospectus with respect to the initial public offering and if the Company’s registration statement has been declared effective by the Securities and Exchange Commission (as provided in Section 2.5), or (ii) if the exercise of this Warrant

3

occurs after or not in connection with an initial public offering of the Company, the average of the closing price(s) of the Company’s Common Stock as quoted over the counter or on any exchange on which the Common Stock is listed as such closing prices are published in The Wall Street Journal for the fifteen trading days (or such lesser number of trading days as the stock may have been actually trading) ending on the day prior to the date of determination of Fair Market Value. Notwithstanding the foregoing, if the Warrant is exercised in connection with a merger or sale of all or substantially all of the Company’s assets, “Fair Market Value” shall mean the value that would have been allocable to or received in respect of a Warrant Share had the Warrant been exercised immediately prior to such merger or sale. If the Common Stock is not traded Over-The-Counter or on an exchange, or if the Warrant is not exercised in connection with a merger or sale of all or substantially all of its assets, the Fair Market Value shall be determined in good faith by the Company’s board of directors. If the holder hereof does not agree with the determination of Fair Market Value as determined by the Company’s board of directors, the Company and the holder hereof shall negotiate an appropriate Fair Market Value. If after ten (10) days, the Company and the holder cannot agree, then the holder may request that the Fair Market Value be determined by an investment banker of national reputation selected by the Company and reasonably acceptable to the Warrantholder. The fees and expenses of such investment banker shall be borne by the Company unless the Fair Market Value determined by such investment banker is equal to or less than the Fair Market Value as determined by the Company, in which event the fees and expenses of such investment banker shall be borne by the holder hereof.

2.3 Exercise Into Common Stock. Upon any exercise of this Warrant, at the election of the holder, this Warrant may be exercised into the number of shares of Common Stock into which the Shares issuable upon such exercise are then convertible.

2.4 Exercise in Connection with an Initial Public Offering, Sale or Merger. Notwithstanding any other provision hereof, if the exercise of all or any portion of this Warrant is made or to be made in connection with the occurrence of a public offering, sale or merger of the Company, the exercise of all or any portion of this Warrant shall, at the election of the Warrantholder, be conditioned upon the consummation of the public offering, sale or merger of the Company in which case such exercise shall not be deemed to be effective until the consummation of such transaction. In the event that transaction is not consummated within 45 days of the targeted date of the transaction, any such exercise shall, at the election of the Warrantholder, be deemed rescinded.

3. Stock Fully Paid; Reservation of Shares. All Shares that may be issued upon the exercise of the rights represented by this Warrant and Common Stock issuable upon conversion of the Preferred Stock will, upon issuance, be validly issued, fully paid and non-assessable, issued in compliance with all applicable federal and state securities laws, and free from all taxes, liens and charges with respect to the issue thereof (except for any applicable transfer taxes which may arise from any subsequent transfer of the Shares by Warrantholder, which shall be paid by Warrantholder). During the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized and reserved for the purpose of issuance upon exercise of the purchase rights evidenced by this Warrant, a sufficient number of shares of its Preferred Stock (and Common Stock issuable upon conversion of the Preferred Stock) to provide for the exercise of the rights represented by this Warrant.

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4. Adjustment of Exercise Price and Number of Shares. The number of Shares purchasable upon the exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time upon the occurrence of certain events, as follows:

(a) Reclassification, Reorganization, Merger or Sale. In case of any (i) reclassification, reorganization, change or conversion of securities of the class issuable upon exercise of this Warrant (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision, combination or stock dividend), or (ii) consolidation or merger of the Company with or into another corporation or entity (other than a merger with another corporation or entity in which the Company is the surviving corporation and which does not result in any reclassification or change of outstanding securities issuable upon exercise of this Warrant), or (iii) sale of all or substantially all of the assets of the Company, then in any of these events, the Company, or such successor or purchasing corporation, as the case may be, shall execute a new Warrant (in form and substance satisfactory to the holder of this Warrant) providing that the holder of this Warrant shall have the right to exercise such new Warrant and upon such exercise to receive, in lieu of each share of Preferred Stock theretofore issuable upon exercise of this Warrant, the kind and amount of shares of stock, other securities, money and property allocable to or receivable by a holder of one share of Preferred Stock upon such reclassification, change, consolidation, merger or sale. Such new Warrant shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 4. The provisions of this section (a) shall similarly apply to successive reclassifications, changes, consolidations, mergers and sales.

(b) Subdivisions or Combination of Shares; Stock Dividends. In the event that the Company shall at any time subdivide the outstanding shares of Preferred Stock, or shall issue a stock dividend on its outstanding shares of Preferred Stock, the number of Shares issuable upon exercise of this Warrant immediately prior to such subdivision or immediately prior to the issuance of such stock dividend shall be proportionately increased, and the Exercise Price shall be proportionately decreased, and in the event that the Company shall at any time combine the outstanding shares of Preferred Stock, the number of Shares issuable upon exercise of this Warrant immediately prior to such combination shall be proportionately decreased, and the Exercise Price shall be proportionately increased, effective at the close of business on the date of such subdivision, stock dividend or combination, as the case may be.

(c) Issuance of Additional Shares. In the event that the Company shall issue shares of its capital stock at a price less than the Exercise Price (after giving effect to any stock splits, reclassifications and the like) (a “Diluting Issuance “), the price at which the Shares may be converted into the Company’s Common Stock shall be adjusted in accordance with the provisions of the Company’s then effective Certificate of Incorporation which apply to Diluting Issuances. The holder acknowledges that any adjustment to the conversion price arises from the provisions of the Certificate of Incorporation, and that no additional right to adjustment based on the issuance of additional shares is created hereby.

5

(d) No Impairment. The Company will not, by amendment of its Amended and Restated Certificate of Incorporation or through any reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Section 4 and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment.

(e) Notices of Record Date. In case at any time:

(i) the Company shall declare any dividend upon its Preferred Stock or Common Stock payable in cash or stock or make any other distribution to the holders of its Preferred Stock or its Common Stock;

(ii) the Company shall offer for subscription pro rata to the holders of its Preferred Stock any additional shares of stock of any class, or other rights;

(iii) there shall be any capital reorganization or reclassification of the capital stock of the Company, or a consolidation or merger of the Company with or into, or a sale of all or substantially all its assets to another entity or entities; or

(iv) there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company;

then, in any one or more of said cases, the Company shall give, by first class mail, postage prepaid, or by telex or telecopier, addressed to the holder of this Warrant at the address of such holder as shown on the books of the Corporation, (A) at least 30 days’ prior written notice of the date on which the books of the Company shall close or a record shall be taken for such dividend, distribution or subscription rights or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, and (B) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, at least 20 days’ prior written notice of the date when the same shall take place. Such notice in accordance with the foregoing clause (A) shall also specify, in the case of any such dividend, distribution or subscription rights, the date on which the holders of Preferred Stock or Common Stock shall be entitled thereto, and such notice in accordance with the foregoing clause (B) shall also specify the date on which the holders of Preferred Stock or Common Stock shall be entitled to exchange their Preferred Stock or Common Stock for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, as the case may be.

5. Notice of Adjustments. Whenever the Exercise Price shall be adjusted pursuant to the provisions hereof, the Company shall within 20 days of such adjustment deliver a certificate

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signed on behalf of the Company by its chief financial officer (or an officer of similar standing) to the holder of this Warrant setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated, and the Exercise Price after giving effect to such adjustment.

6. Fractional Shares. No fractional shares of Preferred Stock or Common Stock will be issued in connection with any exercise hereunder, but in lieu of such fractional shares the Company shall make a cash payment therefor upon the basis of the Exercise Price then in effect.

7. Compliance with Securities Act; Disposition of Warrant or Shares of Preferred Stock; Compliance with Bank Holding Company Act.

(a) Compliance with Securities Act. The holder of this Warrant, by acceptance hereof, agrees that this Warrant, the shares of Preferred Stock to be issued upon exercise hereof and the Common Stock to be issued upon the conversion of such Preferred Stock are being acquired for investment purposes only and that such holder will not offer, sell or otherwise dispose of this Warrant or any shares of Preferred Stock to be issued upon exercise hereof (or Common Stock to be issued upon the conversion of such Preferred Stock) except under circumstances which will not result in a violation of the Act and as permitted by Section 7(b) below. This Warrant and all shares of Preferred Stock issued upon exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) shall, unless registered under the Act, be stamped or imprinted with a legend in substantially the following form:

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). NO SALE OR DISPOSITION MAY BE EFFECTED WITH OUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR (ii) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED, EXCEPT THAT NO SUCH OPINION SHALL BE REQUIRED IF SUCH SALE IS PURSUANT TO RULE 144 PROMULGATED UNDER THE ACT. A COPY OF THE AGREEMENT COVERING THE PURCHASE OR SALE OF THESE SECURITIES AND RESTRICTING THEIR TRANSFER OR SALE MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD HEREOF.

(b) Disposition of Warrant and Shares. With respect to any offer, sale or other disposition of this Warrant or any shares of Preferred Stock acquired pursuant to the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) prior to registration of such shares, the holder hereof and each subsequent holder of this Warrant (or any shares of Preferred Stock or common stock issued upon conversion of the Preferred Stock) agrees to give written notice to the Company prior thereto, describing briefly the manner thereof, together with a written statement that he, she or it is an “accredited investor” as defined under Rule 501 of Regulation D under the Act and agrees to be bound by all of the restrictions on transfer contained herein, along with a written opinion of such holder’s counsel, if reasonably

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requested by the Company and reasonably satisfactory to the Company, to the effect that such offer, sale or other disposition may be effected without registration or qualification (under the Act as then in effect) of this Warrant or such shares of Preferred Stock (or Common Stock to be issued upon the conversion of such Preferred Stock) and indicating whether or not under the Act this Warrant or the certificates representing such shares of Preferred Stock or Common Stock to be sold or otherwise disposed of require any restrictive legend thereon in order to ensure compliance with the Act. This Warrant or the certificates representing the shares of Preferred Stock or Common Stock thus transferred (except a transfer pursuant to Rule 144) shall bear a legend as to the applicable restrictions on transferability in order to insure compliance with the Act, unless in the aforesaid opinion of counsel for the holder, such legend is not required in order to insure compliance with the Act. If the legend is not required, Company agrees to reissue the Warrant and/or the shares receivable upon the exercise hereof without said legend. Nothing herein shall restrict the transfer of this Warrant (or any portion hereof) or the certificates representing the shares of Preferred Stock acquired pursuant to the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) by the initial holder hereof or any successor holder to (i) any affiliate of such holder, provided such affiliate is an accredited investor, including without limitation any partnership affiliated with such holder, any partner of any such partnership or any successor corporation to the holder hereof as a result of a merger or consolidation with or a sale of all or substantially all of the stock or assets of the holder, (ii) any legal entity or natural person (hereinafter “Person”) in a public offering pursuant to an effective registration statement under the Act, (iii) to any other Person to the extent that the transfer to such Person is exempt from the registration requirements of the Act and such Person agrees in writing to be bound by all of the restrictions on transfer contained herein, or (iv) any Person or Persons if the holder hereof shall also transfer or assign all or part of its interest in the Financing Arrangement and such Person agrees in writing to be bound by all of the restrictions on transfer contained herein. Any transfer described above must be made in compliance with all applicable federal and state securities laws. The Company may issue stop transfer instructions to its transfer agent in connection with the foregoing restrictions.

8. Warrantholder’s Representations

(a) The Warrantholder acknowledges that it has had access to all material information concerning the Company which it has requested. The Warrantholder also acknowledges that it has had the opportunity to, and has to its satisfaction, questioned the officers of the Company with respect to its investment hereunder. The Warrantholder represents that it understands that the Warrant and the Preferred Stock (and the shares of Common Stock issuable upon conversion of the Preferred Stock) are speculative investments, that it is aware of the Company’s business affairs and financial condition and that it has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Warrant. The Warrantholder is purchasing the Warrant and any Preferred Stock issued upon exercise thereof (and the shares of Common Stock issuable upon conversion of the Preferred Stock) for investment for its own account only and not with a view to, or for resale in connection with, any “distribution” thereof in violation of the Act or applicable state securities laws. The Warrantholder further represents that it understands that the Warrant and Preferred Stock have not

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been registered under the Securities Act or applicable state securities laws by reason of specific exemptions therefrom, which exemptions depend upon, among other things, the bona fide nature of the Warrantholder’s investment intent as expressed herein. The Warrantholder acknowledges that it is experienced in evaluating and investing in companies engages in business similar to the Company’s and that it has such knowledge and experience in financial and business affairs that it is capable of evaluating the merits and risks of investment in the Company and it is able to bear the economic risk of that investment. The Warrantholder is an “accredited investor” as defined in Regulation D promulgated under the Securities Act. The Warrantholder’s corporate headquarters and principal place of business is located in the State of Illinois.

9. Company’s Representations

As a material inducement to the Warrantholder to purchase this Warrant, the Company hereby represents and warrants that:

(a) The Company shall have made all filings under applicable federal and state securities laws necessary to consummate the issuance of this Warrant pursuant to this Agreement in compliance with such laws, except for such filings as may be made properly after the Closing.

(b) If applicable, the Company, the Warrantholder and any original investors in the Company who are parties to any stock purchase agreements, and whose consent or approval is required prior to the execution and delivery of this Warrant, shall have entered into an amendment to each such stock purchase agreement to provide for such consent and any required waivers, in such form and substance acceptable to the Warrantholder, and such amendment shall be in full force and effect as of the date hereof.

(c) If applicable, the Company, the Warrantholder and any original holders of shares in the Company who are parties to any investor’s rights agreements, and whose consent or approval is required prior to the execution and delivery of this Warrant, shall have entered into an amendment to each such investor’s rights agreement, providing for such consent and any required waivers and, where appropriate, adding the Warrantholder as a party thereto, in such form and substance acceptable to the Warrantholder, and such amendment shall be in full force and effect as of the date hereof.

(d) The copies of any existing stock purchase agreements and investor’s rights agreements and the Company’s charter documents and bylaws which have been furnished to Warrantholder or the Warrantholder’s counsel reflect all amendments made thereto at any time prior to the date hereof and are correct and complete.

(e) As of the date hereof, the authorized capital stock of the Company shall be as stated on the Capitalization Schedule attached hereto as Exhibit B (the “Capitalization Schedule”) and made a part hereof. As of the date hereof, except for this Warrant and except as set forth on the attached Capitalization Schedule, the Company shall not have outstanding any stock or

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securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights, warrants or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans. The Capitalization Schedule truthfully and accurately sets forth the Company’s information with respect to all outstanding options and rights to acquire the Company’s capital stock. As of the date hereof, except as set forth on the Capitalization Schedule, the Company shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock. As of the date hereof, all of the outstanding shares of the Company’s capital stock shall be validly issued, fully paid and nonassessable.

(f) With respect to the issuance of this Warrant or the issuance of the Preferred Stock upon exercise of the Warrant (and the shares of Common Stock issuable upon conversion of the Preferred Stock), there are no statutory or contractual stockholders preemptive rights or rights of refusal, except for any such rights contained in any stock purchase agreement and/or investor’s rights agreements which have been waived. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of this Warrant does not require registration under the Securities Act or any applicable state securities laws. To the best of the Company’s knowledge, there are no agreements between the Company’s stockholders with respect to the voting or transfer of the Company’s capital stock or with respect to any other aspect of the Company’s affairs, except for any stock purchase agreements and any investor’s rights agreements identified on the attached Capitalization Schedule.

(g) The execution, delivery and performance of this Warrant has been duly authorized by the Company. This Warrant constitutes a valid and binding obligation of the Company, enforceable in accordance with its respective terms. The execution and delivery by the Company of this Warrant, the issuance of the Preferred Stock upon exercise of this Warrant (and the shares of Common Stock issuable upon conversion of the Preferred Stock), and the fulfillment of and compliance with the respective terms hereof and thereof by the Company, do not and shall not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default under, (iii) result in the creation of any lien, security interest, charge or encumbrance upon the Company’s capital stock or assets pursuant to, (iv) give any third party the right to modify, terminate or accelerate any obligation under, (v) result in a violation of, or (vi) require any authorization, consent, approval, exemption or other action by or notice or declaration to, or filing with, any court or administrative or governmental body or agency pursuant to, the charter or bylaws of the Company or any subsidiary, or any law, statute, rule or regulation to which the Company or any subsidiary is subject, or any agreement, instrument, order, judgment or decree to which the Company or any subsidiary is subject, except for any such filings required under applicable “blue sky” or state securities laws or required under Regulation D promulgated under the Securities Act.

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10. Company’s Covenants

(a) Until such time as the Company shall have satisfied all of its obligations under the Financing Arrangement, Company shall deliver to Warrantholder such financial information as is required under the terms of the Financing Arrangement. From and after the date that the Company shall have satisfied all of its obligations under the Financing Arrangement, the Company shall deliver to the Warrantholder (so long as the Warrantholder holds all or any portion of the Warrant or any Preferred Stock or any shares of Common Stock issuable upon conversion of the Preferred Stock) all of the financial and other information delivered or required to be delivered by the Company to any of its stockholders. All such financial and other information shall be delivered pursuant to this Section 10(a) on a timely basis, but no later than 30 days after each fiscal quarter end for quarterly statements and no later than 90 days after each fiscal year end for annual statements.

11. Miscellaneous

(a) Rights as Shareholders. No holder of this Warrant, as such, shall be entitled to vote or receive dividends or be deemed the holder of Preferred Stock (or Common Stock to be issued upon the conversion of such Preferred Stock) or otherwise be entitled to any voting or other rights as a shareholder of the Company, until this Warrant shall have been exercised and the Shares purchasable upon the exercise shall have become deliverable, as provided herein.

(b) Issuance Tax. The issuance of certificates for shares of Preferred Stock upon exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) shall be made without charge to the holder hereof for any issuance tax in respect hereof, provided that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of any certificate in a name other than that of the holder of this Warrant.

(c) No Inconsistent Agreements. The Company shall not hereafter enter into any agreement with respect to its securities which is inconsistent with or violates the rights granted to the holders of Registrable Securities by the Company whether hereunder or in any other document, agreement or instrument by which the Company may be bound. For the purposes of this Agreement, “Registrable Securities” means (i) any Preferred Stock issued upon exercise of this Warrant (and the shares of Common Stock issuable upon conversion of the Preferred Stock) and (ii) any Preferred or Common Stock issued or issuable with respect to the securities referred to in clause (i) above by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, sale, consolidation or other reorganization. For purposes hereof, a Person shall be deemed to be a holder of Registrable Securities, and the Registrable Securities shall be deemed to be in existence, whenever such Person has the right to acquire directly or indirectly such Registrable Securities (upon conversion or exercise in connection with a transfer of securities or otherwise, but disregarding any restrictions or limitations upon the exercise of such right), whether or not such acquisition has actually been effected, and such Person shall be entitled to exercise the rights of a holder of Registrable Securities hereunder.

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(d) Modification and Waiver. This Warrant and any provision hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the Company and the holder of this Warrant.

(e) Attorneys’ Fees. In the event of an action, suit or proceeding brought under or in connection herewith, the prevailing party therein shall be entitled to recover from, and the other party hereto agrees to pay, the prevailing party’s costs and expenses in connection therewith, including reasonably attorneys’ fees.

(f) Notices. All notices, demands or other communications required or permitted to be given or delivered under or by reason of the provisions hereof shall be in writing and shall be deemed to have been given when delivered personally to the recipient, the next business day after having been sent to the recipient by reputable overnight courier service (charges prepaid) or four business days after having been mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid. Such notices, demands and other communications shall be sent to the Warrantholder and to the Company at the respective addresses indicated on the signature page hereof, or to such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.

(g) Binding Effect on Successors. This Warrant shall be binding upon any corporation succeeding the Company by merger, consolidation or acquisition of all or substantially all of the Company’s assets, and all of the obligations of the Company relating to the Preferred Stock issuable upon the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) shall survive the exercise and termination of this Warrant and all of the covenants and agreements of the Company shall inure to the benefit of the successors and assigns of the holder hereof. All covenants and agreements contained herein by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not. In addition, whether or not any express assignment has been made, the provisions hereof which are for the benefit of Warrantholders or holders of Registrable Securities are also for the benefit of, and enforceable by, any subsequent holder of Registrable Securities. The Company will, at the time of the exercise of this Warrant, in whole or in part, upon request of the holder hereof but at the Company’s expense, acknowledge in writing its continuing obligation to the holder hereof in respect of any rights (including, without limitation, any right to registration of the Shares which rights are agreed to by the Company) to which the holder hereof shall continue to be entitled after such exercise in accordance with this Warrant; provided that the failure of the holder hereof to make any such request shall not affect the continuing obligation of the Company to the holder hereof in respect of such rights.

(h) Lost Warrants or Stock Certificates. The Company covenants to the holder hereof that upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of this Warrant or any stock certificate issued upon exercise hereof or in replacement thereafter and, in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company and without requiring any bond, or in the case of any such mutilation upon surrender and cancellation of such Warrant or stock certificate, the Company will make and deliver a new Warrant or stock certificate, or like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate.

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(i) Registration Rights. The holder hereof shall be entitled, upon execution of an amendment to the Company’s Amended and Restated Investors’ Rights Agreement, dated as of July 20, 2001, September 5, 2001 and September 18, 2001, attached hereto as Exhibit C (the “Rights Agreement”), with respect to the shares of Preferred Stock issued upon exercise hereof or the shares of Common Stock issued upon conversion of the Preferred Stock, to the piggyback registration rights set forth in Section 2.3 of the Rights Agreement to the same extent and on the same terms and conditions as possessed by the Investors thereunder.

(j) Market Stand-Off. To the extent requested by the Company and an underwriter of Common Stock or other securities of the Company, Warrantholder hereby agrees that during the period of duration (not to exceed 180 days) specified by the Company and such underwriter following the effective date of any registered underwritten public offering of Company securities (the “Stand Off Period”), it shall not directly or indirectly sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of any securities of the Company held by it at any time during such period, except Common Stock included in such registration; provided, however, that this agreement on restrictions shall be void and of no force and effect unless similar restrictions upon transfer are entered into by the Company’s executive officers and directors, including but not limited to the term of duration of the Stand Off Period. In order to enforce this covenant, the Company may impose stop-transfer instructions with respect to the Company’s securities held by such holder (and the shares or securities of every other person subject to the foregoing restriction) until the end of such period.

(k) Descriptive Headings. The descriptive headings of the several paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant.

(l) Governing Law. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF CALIFORNIA, EXCLUDING THAT BODY OF LAW RELATING TO CONFLICTS OF LAW AND CHOICE OF LAW.

SIGNATURE PAGE FOLLOWS:

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In Witness Whereof, this Warrant to purchase Preferred Stock has been duly executed as of the Grant Date hereinabove set forth.

Issued By:		Accepted By:
Danger, Inc.		Heller Financial Leasing, Inc.
By:	/s/ Andrew E. Rubin	By:	/s/ Charles Arkin
Title:	CEO	Title:	AVP – Contract Administration
Address for Notices:		Address for Notices:
124 University Ave.		500 West Monroe
Palo Alto, CA 94301		Chicago, IL 60661
		Attention: Portfolio Management,

Dated as of : 1/25/02

Copy to:

Brobeck, Phleger & Harrison

Two Embarcadero Place

2200 Gerg Road

Palo Alto, CA 94303

Atten: David Makarechian, Esq.

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EXHIBIT A

Notice of Exercise

To: Danger, Inc. (“Company”)

124 University Ave.

Palo Alto, CA 94301

Attention: Chief Financial Officer

[1. The undersigned hereby elects to purchase                                          shares of Series B-1 Preferred Stock of Company pursuant to the terms of the attached Warrants, and tenders herewith payment of the purchase price of such shares in full.]

[1. The undersigned hereby elects to purchase                                      shares of Series B-1 Preferred Stock of Company pursuant to a non-cash exercise of the Warrant as provided in Section 2.2 of the Warrant. *]

2. Check here if applicable:          The undersigned confirms that this exercise is made in connection with the occurrence of a public offering, sale or merger of the Company, and the undersigned further elects to condition this exercise of the Warrant upon the consummation of said public offering, sale or merger of the Company. This exercise shall not be deemed to be effective until the consummation of such transaction. In the event that transaction is not consummated within 45 days of the targeted date of the transaction, the undersigned will advise Company whether or not this exercise should be deemed rescinded.

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

Heller Financial Leasing, Inc.

500 West Monroe

Chicago, IL 60661

3. The undersigned represents that the aforesaid shares are being acquired for the account of the undersigned for investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing such shares.

Heller Financial Leasing, Inc.
By:
	(Signature)
Its:
Date:

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EX-4.5

Exhibit 4.5

THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT.

Warrant No. «Warrant_No»

DANGER, INC.

WARRANT TO PURCHASE SHARES OF SERIES D PREFERRED STOCK

This Warrant is issued to «Name_of_Investors» (“Holder”) by Danger, Inc., a Delaware corporation (the “Company”), as of January 27, 2003.

1. Purchase of Shares. Subject to the terms and conditions hereinafter set forth herein, Holder is entitled, upon surrender of this Warrant at the principal office of the Company (or at such other place as the Company shall notify Holder in writing), to purchase from the Company up to «Warrant_Written» («Warrant») shares (the “Shares”) of Series D Preferred Stock of the Company (the “Series D Preferred Stock”) at an exercise price of $0.9007 per share (the “Exercise Price”). The Shares and the Exercise Price shall be subject to adjustment as set forth in Section 8 hereof.

2. Exercise Period. This Warrant shall be exercisable for a period (the “Exercise Period”) of seven (7) years from the date hereof; provided, however, that in the event of the earlier closing of (a) the issuance and sale of shares of the Company’s Common Stock (the “Common Stock”) in the Company’s first underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Act”), at a per share price to the public that values the Company at not less than $373 million and in which the aggregate proceeds to the Company (before deduction of underwriters’ discounts and expenses relating to the issuance, including, without limitation, fees of the Company’s counsel) are at least $35,000,000, (b) a sale of all or substantially all the assets of the Company, or (c) a merger or reorganization of the Company into or consolidation with any other entity (excluding a reorganization or merger, the sole purpose of which is to change the jurisdiction of incorporation of the Company), this Warrant shall, on the date of such event, no longer be exercisable and become null and void. In the event of a proposed transaction of the kind described above, the Company shall notify Holder in writing at least fifteen (15) days prior to the consummation of such event or transaction.

3. Method of Exercise. While this Warrant remains outstanding and exercisable during the Exercise Period, Holder may exercise, in whole or in part, the purchase rights evidenced hereby. Such exercise shall be effected by: (i) the surrender of the Warrant, together with a duly executed copy of the form of Exercise Notice attached hereto, to the Chief Executive Officer of the Company at its principal offices; and (ii) the payment to the Company

by cash, check or wire transfer of an amount equal to the aggregate Exercise Price for the number of Shares being purchased.

4. Effective Time of Exercise. Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 3 above. At such time, the person or persons in whose name or names any certificates for Series D Preferred Stock shall be issuable upon such exercise as provided in Section 6 below shall be deemed to have become the holder or holders of record of the Series D Preferred Stock represented by such certificates.

5. Net Issuance Provision. In lieu of exercising pursuant to paragraph 3 above, at the Holder’s option, while this Warrant remains outstanding and exercisable during the Exercise Period, Holder may exercise this Warrant by surrender of this Warrant as determined below (“Net Issuance”). If the Holder elects the Net Issuance method, the Company will issue Series D Preferred Stock in accordance with the following formula:

X = Y(A-B)

            A

Where:

X = the number of shares of Series D Preferred Stock to be issued to the Holder.

Y = the number of shares of Series D Preferred Stock requested to be exercised under this Warrant Agreement.

A = the fair market value of one (1) share of Series D Preferred Stock.

B = the Exercise Price (as adjusted on the date of calculation).

For purposes of the above calculation, current fair market value of Series D Preferred Stock shall mean with respect to each share of Series D Preferred Stock:

(a) the product of (i) the average daily Market Price (as defined below) during the period of the most recent ten (10) days, ending on the last business day before the effective date of exercise, on which the national securities exchanges were open for trading and (ii) the number of shares of the Common Stock (as defined herein) into which each share of Series D Preferred Stock is convertible on such date; or

(b) if no class of Common Stock is then listed or admitted to trading on any national securities exchange or quoted in the over-counter market, the fair market value shall be the Market Price (as defined in Section 5(c) hereof) on the last business day before the effective date of exercise.

(c) If the Common Stock is traded on a national securities exchange or admitted to unlisted trading privileges on such an exchange, or is listed on the National Market

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System (the “National Market System”) of the Nasdaq, the Market Price as of a specified day shall be the last reported sale price of Common Stock on such exchange or on the National Market System on such date or if no such sale is made on such day, the mean of the closing bid and asked prices for such day on such exchange or on the National Market System. If the Common Stock is not so listed or admitted to unlisted trading privileges, the Market Price as of a specified day shall be the mean of the last bid and asked prices reported on such date (x) by the Nasdaq or (y) if reports are unavailable under clause (x) above by the National Quotation Bureau Incorporated. If the Common Stock is not so listed or admitted to unlisted trading privileges and bid and ask prices are not reported, the Market Price as of a specified day shall be determined in good faith by the Board of Directors of the Company.

Upon partial exercise by either cash or Net Issuance, the Company shall promptly issue an amended Warrant representing the remaining number of shares purchasable thereunder. All other terms and conditions of such amended Warrant shall be identical to those contained herein, including, but not limited to, the Exercise Period.

6. Certificates for Shares. Upon the exercise of the purchase rights evidenced by this Warrant, one or more certificates for the number of Shares so purchased shall be issued as soon as practicable thereafter. Upon any partial exercise of this Warrant, the Company will forthwith issue and deliver to Holder a new warrant or warrants of like tenor as this Warrant for the remaining portion of the Series D Preferred Stock for which this Warrant may still be exercised. The Company shall pay all expenses, and any and all stamp or similar taxes (but excluding transfer taxes) that may be payable in connection with the preparation, issuance and delivery of stock certificates and any new warrant certificate under this Section 6.

7. Issuance of Shares. The Company covenants that (a) the Shares, when issued pursuant to the exercise of this Warrant, will be duly and validly issued, fully-paid and non-assessable and free from all taxes, liens and charges with respect to the issuance thereof (except for any applicable transfer taxes, which shall be paid by Holder) and (b) during the Exercise Period, the Company will reserve from its authorized and unissued Series D Preferred Stock a sufficient number of shares to provide for the issuance of Series D Preferred Stock upon the exercise of this Warrant.

8. Adjustment of Exercise Price and Number of Shares. The number of and kind of securities purchasable upon exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:

(a) Subdivisions, Combinations and Other Issuances. If the Company shall at any time prior to the expiration of this Warrant subdivide its Series D Preferred Stock, by split or otherwise, or combine its Series D Preferred Stock, or issue additional shares of its Series D Preferred Stock as a dividend with respect to any shares of its Series D Preferred Stock, the number of Shares issuable on the exercise of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination. Appropriate adjustments shall also be made to the purchase price payable per share, but the aggregate purchase price payable for the total number of Shares purchasable under this Warrant (as adjusted) shall remain the same. Any adjustment under this Section 8(a) shall become effective as of the record date of such subdivision, combination or dividend, or in the

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event that no record date is fixed, upon the making of such subdivision, combination or dividend. It being understood that the Series D Preferred Stock issuable upon exercise of the Warrant shall be subject to the provisions set forth in the Amended and Restated Certificate of Incorporation as in effect as of the date hereof (the “Restated Certificate”) which relate to the adjustment of the Conversion Price, as that term is defined in the Restated Certificate.

(b) Reclassification, Reorganization and Consolidation. In case of any reclassification, capital reorganization, or change in the Series D Preferred Stock of the Company (other than as a result of a subdivision, combination, or stock dividend provided for in Section 8(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to Holder, so that Holder shall have the right at any time prior to the expiration of this Warrant to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Series D Preferred Stock as were purchasable by Holder immediately prior to such reclassification, reorganization or change. In any such case, appropriate provisions shall be made with respect to the rights and interest of Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same.

(c) Conversion. If all of the Company’s outstanding Preferred Stock is redeemed or converted into shares of Common Stock, then this Warrant shall automatically become exercisable for that number of shares of Common Stock that would have been received if this Warrant had been exercised in full and the shares of Series D Preferred Stock received thereupon had been simultaneously converted into shares of Common Stock, in each case immediately prior to such redemption or conversion. Appropriate provisions shall be made with respect to the rights and interests of Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of Common Stock deliverable upon exercise hereof, and appropriate adjustments shall also be made to the purchase price payable per share, but the aggregate purchase price payable for the total number of shares of Common Stock purchaseable under this Warrant (as adjusted) shall remain the same.

(d) Certificate of Adjustment. When any adjustment is required to be made in the number or kind of shares purchasable upon exercise of the Warrant or in the Exercise Price, an officer of the Company shall promptly compute such adjustment in accordance with the terms of this Warrant and prepare a certificate setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated and the Exercise Price and number of shares purchasable hereunder after giving effect to such adjustment, and shall cause a copy of such certificate to be mailed (by first class mail, postage prepaid) to Holder.

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9. Compliance with Securities Laws. Holder hereby represents and warrants that:

(a) Purchase Entirely for Own Account. This Warrant and the Series D Preferred Stock issuable upon exercise hereof (collectively, the “Securities”) will be acquired for investment for Holder’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and Holder has no present intention of selling, granting any participation in or otherwise distributing the same. Holder does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participation to any person with respect to any of the Securities. Holder represents that it has full power and authority to enter into this Warrant.

(b) Investment Experience. Holder acknowledges that it is able to fend for itself, can bear the economic risk of its investment and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in this Warrant. Holder also represents it has not been organized for the purpose of acquiring this Warrant.

(c) Accredited Investor. Holder is an “accredited investor” within the meaning of Rule 501 of Regulation D of the Securities and Exchange Commission (the “SEC”), as presently in effect.

(d) Restricted Securities. Holder understands that the Securities are characterized as “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering, and that under such laws and applicable regulations such securities may be resold without registration under the Act only in certain limited circumstances. In this connection, Holder represents that it is familiar with SEC Rule 144 promulgated under the Act, as presently in effect, and understands the resale limitations imposed thereby and by the Act.

10. Further Limitations on Disposition. Without in any way limiting the representations set forth above, Holder further agrees not to make any disposition of all or any portion of the Securities unless and until there is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with such registration statement, or (i) Holder shall have notified the Company of the proposed disposition and shall have furnished the Company with a detailed statement of the circumstances surrounding the proposed disposition, and (ii) if reasonably requested by the Company, Holder shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that such disposition will not require registration of such shares under the Act.

11. No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant, but in lieu of such fractional shares the Company shall make a cash payment therefor on the basis of the fair market value of the Company’s Series D Preferred Stock as determined pursuant to Section 5 above.

12. No Stockholder Rights. Prior to exercise of this Warrant, Holder shall not be entitled to any rights of a stockholder with respect to the Shares, including (without

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limitation) the right to vote such Shares, receive dividends or other distributions thereon, exercise preemptive rights or be notified of stockholder meetings, and Holder, as such, shall not be entitled to any notice or other communication concerning the business or affairs of the Company, except as set forth in Section 2 above.

13. Replacement of Warrant. 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 substance 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 and amount.

14. Notices. All notices or other communications hereunder shall be in writing and shall be deemed given when (i) personally delivered, (ii) three days after being sent by prepaid certified or registered U.S. mail, or one day after being sent, if sent by nationally recognized overnight courier, to the address of the party to be noticed as set forth herein or such other address as such party last provided to the other by written notice, or (iii) upon receipt of electronic confirmation, if by facsimile. All notices shall be sent to the addresses and facsimile numbers set forth below or such other address as may be given from time to time under the terms of this notice provision:

If to the Company:

Danger, Inc.

124 University Ave.

Palo Alto, CA 94301

Attention: Chief Executive Officer

If to Holder:

At the address and facsimile number

previously indicated to the Company.

15. Successors and Assigns. Except as otherwise provided herein, the terms and conditions of this Warrant shall inure to the benefit of and be binding upon the successors and assigns of the parties (including transferees of any Shares). Nothing in this Warrant, express or implied, is intended to confer upon any party, other than the parties hereto or their respective successors and assigns, any rights, remedies, obligations or liabilities under or by reason of this Warrant, except as expressly provided herein. The Warrant and Shares shall not be transferable by Holder except to an affiliate of such Holder, including, without limitation, any affiliated corporation, partnership, limited partnership, limited liability company, or an investment fund, or to any stockholders, partners, general partners, limited partners and members of such Holder, provided that such affiliate, stockholder, partner, general partner, limited partner or member agrees in writing to be subject to the obligations and conditions set forth herein.

16. Amendments and Waivers. Any term of this Warrant may be amended and the observance of any term of this Warrant may be waived (either generally or in a particular

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instance and either retroactively or prospectively), with the written consent of each of the parties hereto. Any waiver or amendment effected in accordance with this section shall be binding upon Holder and the Company.

17. Governing Law. This Warrant shall be governed by the laws of the State of California as applied to agreements among California residents made and to be performed entirely within the State of California. Each of the parties irrevocably and unconditionally waives, to the fullest extent permitted by law, any and all rights to a trial by jury in connection with any litigation arising out of or relating to this Warrant or the transaction contemplated hereby.

18. Market Stand-off Provision. Holder hereby agrees that, during the period of duration not to exceed 180 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of the first registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, and, for a period of duration not to exceed 90 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of any subsequent registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, it shall not, to the extent requested by the Company and such underwriter, directly or indirectly, sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound), or reduce its interest in (collectively, “Transfer”), any Shares issuable upon exercise of this Warrant during such period except Common Stock included in such registration; provided, however, that all executive officers, directors and stockholders that hold one percent (1%) or more of the Common Stock (including on an as-converted basis any shares of Common Stock issuable upon the conversion or exercise of any share of the Company’s Preferred Stock, warrant, right or other security) of the Company enter into similar agreements. Such restrictions, however, shall not be applicable to transfers to any affiliated entity of Holder, including any affiliated corporation, partnership, limited partnership, limited liability company or investment fund, or to any stockholders, partners, general partners, limited partners and members of Holder, in each case who agree in writing to be bound by this Warrant, including this Section 18.

To enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Company’s securities held by Holder (and the shares or securities of every other person or entity subject to the foregoing restriction) until the end of such period.

19. Entire Agreement. This Warrant and the other documents delivered pursuant hereto or referred to herein, constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof.

20. Severability. In case any provision of this Warrant shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

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21. Counterparts. This Warrant may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

22. Survival. Except as expressly set forth herein, the representations, warranties, covenants and agreements made herein shall survive the closing of the transactions contemplated hereby.

23. Confidentiality. Holder agrees that, except with the prior written consent of the Company, Holder shall at all times keep confidential and not divulge, furnish or make accessible to anyone any confidential information, knowledge or data concerning or relating to the business or financial affairs of the Company to which Holder has been or shall become privy. The provisions of this Section 23 shall be in addition to, and not in substitution for, the provisions of any separate nondisclosure agreement executed by the parties hereto.

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IN WITNESS WHEREOF, this Warrant is executed as of the date first referenced above.

COMPANY:
DANGER, INC.
By:
	Henry R. Nothhaft, Chairman and Chief Executive Officer

EXERCISE NOTICE

Danger, Inc.

Attention: Chief Executive Officer

1. The undersigned hereby elects to purchase, pursuant to the provisions of the Warrant to Purchase Shares of Series D Preferred Stock issued by Danger, Inc. and held by the undersigned, the original of which is attached hereto,                                  shares of Series D Preferred Stock of Danger, Inc. Payment of the exercise price per share required under such Warrant accompanies this Exercise Notice.

2. The undersigned hereby represents and warrants that the undersigned is acquiring such shares for its own account for investment purposes only, and not for resale or with a view to distribution of such shares or any part thereof.

HOLDER:

Name:

Title:

Date:

Address:

Name in which shares should be registered:

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EX-4.6

Exhibit 4.6

NEITHER THIS WARRANT NOR THE SHARES OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). NO SALE, TRANSFER OR OTHER DISPOSITION OF THIS WARRANT OR SAID SHARES MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR (ii) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED, EXCEPT THAT NO SUCH OPINION SHALL BE REQUIRED IF SUCH SALE IS PURSUANT TO RULE 144 PROMULGATED UNDER THE ACT.

WARRANT

TO PURCHASE

SHARES OF SERIES D CONVERTIBLE PREFERRED STOCK

THIS CERTIFIES THAT, for good and valuable consideration received from Heller Financial Leasing, Inc., a GE Capital Company (“Warrantholder”) is entitled to subscribe for and purchase Thirty-Three Thousand Three Hundred and Seven (33,307) shares (as adjusted pursuant to provisions hereof, the “Shares”) of the fully paid and non-assessable Series D Convertible Preferred Stock of Danger, Inc., a Delaware corporation with its principal place of business at 3101 Park Blvd., Palo Alto, CA 94306 (the “Company”), at an exercise price per share of $0.9007 (such price and such other price as shall result, from time to time, from adjustments specified herein, is hereafter referred to as the “Exercise Price”), subject to the provisions and upon the terms and conditions hereinafter set forth. As used herein, the term “Preferred Stock” or “Shares” shall mean the Company’s presently authorized Series D Convertible Preferred Stock, and any stock into or for which such Series D Convertible Preferred Stock may hereafter be converted or exchanged pursuant to the Certificate of Incorporation of the Company as from time to time amended as provided by law and in such Certificate. As used herein, term “Grant Date” shall mean December 4, 2003. The Company acknowledges that the cash consideration paid by Warrantholder for this Warrant is $10.00 for income tax purposes, that such amount has been duly received by the Company, and that this Warrant is issued in connection with that certain financial accommodation entered into by and between Company as the obligor and Warrantholder as the obligee thereunder (the “Financing Arrangement”).

In the event that all preferred stock is mandated to be converted into Common Stock, this Warrant shall be exercisable solely for such Common Stock, and any reference throughout this Warrant to shares of Preferred Stock shall be deemed to refer to the shares of Common Stock into which the Preferred Stock may be converted in accordance with the conversion formula set forth in the Company’s Certificate of Incorporation, as amended from time to time.

1. Term. The purchase rights represented by this Warrant are exercisable, in whole or in part, at any time and from time to time, from and after the Grant Date and on or prior to the seventh (7^th) anniversary of the Grant Date.

2. Method of Exercise; Net Issue Exercise.

2.1 Method of Exercise; Payment; Issuance of New Warrant. The purchase rights represented by this Warrant may be exercised by the Warrantholder, in whole or in part and from time to time, by the surrender of this Warrant (with the notice of exercise form attached

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hereto as Exhibit A duly executed) at the principal office of the Company and by the payment to the Company of an amount equal to the then applicable Exercise Price per share multiplied by the number of Shares then being purchased. The Warrantholder shall be deemed to have become the holder(s) of record of, and shall be treated for all purposes as the record holder(s) of, the Shares represented thereby (and such Shares shall be deemed to have been issued) immediately prior to the close of business on the date or dates upon which this Warrant is exercised. In the event of any exercise of the rights represented by this Warrant, certificates for the Shares so purchased shall be promptly delivered to the holder hereof as soon as possible (and in any event within five business days of receipt of such notice) and, unless this Warrant has been fully exercised, a new warrant representing the portion of the Shares, if any, with respect to which this Warrant shall not then have been exercised shall also be issued to the holder hereof as soon as possible (and in any event within such five business day period).

2.2 Non-Cash Exercise.

(a) In lieu of payment in cash, the rights represented by this Warrant may also be exercised by a written notice of exercise in the form of Exhibit A attached hereto, providing for the non-cash exercise of this Warrant for the Shares equal to the value (as determined below) of this Warrant (or the portion thereof being exercised), specifying that this non-cash exercise election has been made, and the net number of Shares to be issued after giving effect to such non-cash exercise. In the event the Warrantholder makes such election, Company shall issue to the holder a number of shares computed using the following formula:

	X =	Y(A-B)
		A
Where:
	X =	the number of Shares to be issued to the holder
	Y =	the number of Shares purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised (as of the date of such non-cash exercise)
	A =	the Fair Market Value of one Share of Preferred Stock (as of the date of such non-cash exercise)
	B =	Exercise Price of one Share of Preferred Stock (as adjusted to the date of such non-cash exercise)

(b) For purposes of this Section 2.2, the “Fair Market Value” of one share of the Company’s Preferred Stock shall be equal to the number of shares of Common Stock into which each share of Preferred Stock is convertible as of the date of the exercise, multiplied by the “Fair Market Value” of a share of Common Stock (as determined pursuant to this Section 2.2). The Fair Market Value of one share of the Company’s Common Stock shall be equal to either (i) if the exercise of this Warrant occurs in connection with an initial public offering of the Company, then the Fair Market Value shall be equal to the “initial price to public” specified in the final prospectus with respect to the initial public offering, or (ii) if the exercise of this Warrant occurs after an initial public offering of the Company but not in connection therewith, then the Fair Market Value shall be equal to the average of the closing

price(s) of the Company’s Common Stock as quoted over the counter or on any exchange on which the Common Stock is listed as such closing prices are published in The Wall Street Journal for the fifteen trading days (or such lesser number of trading days as the stock may have been actually trading) ending on the day prior to the date of determination of Fair Market Value. Notwithstanding the foregoing, if the Warrant is exercised in connection with a merger or sale of all or substantially all of the

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Company’s assets, Fair Market Value shall mean the value that would have been allocable to or received in respect of a Warrant Share had the Warrant been exercised prior to such merger or sale. If the Common Stock is not traded Over-The-Counter or on an exchange, or if the Warrant is not exercised in connection with a merger or sale of all or substantially all of its assets, the Fair Market Value shall be determined in good faith by the Company’s board of directors. If the holder hereof does not agree with the determination of Fair Market Value as determined by the Company’s board of directors, the Company and the holder hereof shall negotiate an appropriate Fair Market Value. If after ten (10) days, the Company and the holder cannot agree, then the holder may request that the Fair Market Value be determined by an investment banker of national reputation selected by the Company and reasonably acceptable to the Warrantholder. The fees and expenses of such investment banker shall be borne by the Company unless the Fair Market Value determined by such investment banker is equal to or less than the Fair Market Value as determined by the Company, in which event the fees and expenses of such investment banker shall be borne by the holder hereof.

2.3 Exercise Into Common Stock. Upon any exercise of this Warrant, at the election of the holder, this Warrant may be exercised into the number of shares of Common Stock into which the Shares issuable upon such exercise are then convertible.

2.4 Automatic Exercise. Immediately before the expiration or termination of this Warrant, to the extent this Warrant is not previously exercised, and if the Fair Market Value of one share of whichever is applicable of either (i) the Preferred Stock subject to this Warrant or (ii) the Company’s Common Stock issuable upon conversion of the Preferred Stock subject to this Warrant, is greater than the Exercise Price, then in effect as adjusted pursuant to this Warrant, then this Warrant shall be deemed automatically exercised pursuant to Section 2.2 above, even if not surrendered. For purposes of such automatic exercise, the Fair Market Value of the Company’s Common Stock upon such expiration shall be determined pursuant to Section 2.2 (b) above. To the extent this Warrant or any portion thereof is deemed automatically exercised pursuant to this Section, the Company agrees to promptly notify the Warrantholder of the number of Shares, if any, the holder hereof is to receive by reason of such automatic exercise.

2.5 Exercise in Connection with an Initial Public Offering, Sale or Merger. Notwithstanding any other provision hereof, if the exercise of all or any portion of this Warrant is made or to be made in connection with the occurrence of a public offering, sale or merger of the Company, the exercise of all or any portion of this Warrant shall, at the election of the Warrantholder, be conditioned upon the consummation of the public offering, sale or merger of the Company, in which case such exercise shall not be deemed to be effective until the consummation of such transaction. In the event that the transaction is not consummated within 45 days of the targeted date of the transaction, any such exercise shall, at the election of the Warrantholder, be deemed rescinded.

3. Stock Fully Paid; Reservation of Shares. All Shares that may be issued upon the exercise of the rights represented by this Warrant and Common Stock issuable upon conversion of the Preferred Stock will, upon issuance, be validly issued, fully paid and non-assessable, issued in compliance with all applicable federal and state securities laws, and free from all taxes, liens and charges with respect to the issue thereof. During the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized and reserved for the purpose of issuance upon exercise of the purchase rights evidenced by this Warrant, a sufficient number of shares of its Preferred Stock (and Common Stock issuable upon

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conversion of the Preferred Stock) to provide for the exercise of the rights represented by this Warrant.

4. Adjustment of Exercise Price and Number of Shares. The number of Shares purchasable upon the exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time upon the occurrence of certain events, as follows:

(a) Reclassification, Reorganization, Change or Conversion. In case of any reclassification, reorganization, change or conversion of securities of the class issuable upon exercise of this Warrant (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), then in any of these events, the Company shall execute a replacement warrant (a “New Warrant”), in form and substance reasonably satisfactory to the holder of this Warrant, upon the exercise of which (and at a total purchase price under the New Warrant not to exceed that payable upon the exercise in full of this Warrant) the holder of the New Warrant shall receive, in lieu of each Share receivable upon the exercise of this Warrant, the same kind and amount of shares of stock, other securities, money and property receivable by a holder of one share of Preferred Stock upon such reclassification, reorganization, change or conversion. Such New Warrant shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 4. The provisions of this section (a) shall similarly apply to successive reclassifications, reorganizations, changes, or conversions.

(b) Merger or Sale. In case of any (i) consolidation or merger of the Company with or into another corporation or entity (other than a merger with another corporation or entity in which the Company is the surviving corporation and which does not result in any reclassification or change of outstanding securities issuable upon exercise of this Warrant), or (ii) sale of all or substantially all of the assets of the Company, then in either of such events, the Company, or such successor or purchasing corporation, as the case may be, shall execute a replacement warrant (a “New Warrant”), in form and substance satisfactory to the holder of this Warrant, upon the exercise of which (and at a total purchase price under the New Warrant not to exceed that payable upon the exercise in full of this Warrant) provides that the holder of the New Warrant shall have the right to exercise such New Warrant and upon such exercise to receive, in lieu of each share of Preferred Stock theretofore issuable upon exercise of this Warrant, the kind and amount of shares of stock, other securities, money and property allocable to or receivable by a holder of one share of Preferred Stock upon such reclassification, change, consolidation, merger or sale. Such New Warrant shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 4. The provisions of this section (b) shall similarly apply to successive mergers and sales.

(c) Subdivisions or Combination of Shares; Stock Dividends. In the event that the Company shall at any time subdivide the outstanding shares of Preferred Stock, or shall issue a stock dividend on its outstanding shares of Preferred Stock, the number of Shares issuable upon exercise of this Warrant immediately prior to such subdivision or immediately prior to the issuance of such stock dividend shall be proportionately increased, and the Exercise Price shall be proportionately decreased, and in the event that the Company shall at any time combine the outstanding shares of Preferred Stock, the number of Shares issuable upon exercise of this Warrant immediately prior to such combination shall be proportionately decreased, and the Exercise Price shall be proportionately increased, effective at the close of business on the date of such subdivision, stock dividend or combination, as the case may be.

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(d) Issuance of Additional Shares. In the event that the Company shall at any time make an issuance of “Additional Shares” for consideration (calculated after giving effect to the price at which any preferred shares may be converted to Common Stock) which is less than the Exercise Price per share, then the price at which the Shares may be converted into the Company’s Common Stock shall be subject to the same adjustment to the price at which the Company’s preferred stock may be converted into the Company’s Common Stock as such adjustment is set forth in the Company’s Certificate of Incorporation (as may be amended from time to time), and such adjustment shall be effective as to the Shares receivable upon the exercise of this Warrant regardless of whether or not such conversion price adjustment under such Articles requires the actual issuance of the affected preferred shares. “Additional Shares” shall be defined as the issuance of additional shares of any series of preferred stock or of Common Stock as set forth in the Company’s Certificate of Incorporation. The holder acknowledges that any adjustment to the conversion price arises solely from the Company’s Certificate of Incorporation, and that no additional rights to adjustment based on the issuance of additional shares is created hereby.

(e) No Impairment. The Company will not, by amendment of its Certificate of Incorporation or any other organizational or shareholder rights documents of the Company, or through any reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Section 4 and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment.

(f) Notices of Record Date. In case at any time:

(i) the Company shall declare any dividend upon its Preferred Stock or Common Stock payable in cash or stock or make any other distribution to the holders of its Preferred Stock or its Common Stock;

(ii) the Company shall offer for subscription pro rata to the holders of its Preferred Stock any additional shares of stock of any class, or other rights;

(iii) there shall be any capital reorganization or reclassification of the capital stock of the Company, or a consolidation or merger of the Company with or into, or a sale of all or substantially all its assets to another entity or entities; or

(iv) there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company;

then, in any one or more of said cases, the Company shall give notice as provided in Section 11(f) hereunder as follows: (A) at least 30 days’ prior written notice of the date on which the books of the Company shall close or a record shall be taken for such dividend, distribution or subscription rights or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, and (B) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, at least 30 days’ prior written notice of the date when the same shall take place. Such notice in accordance with the foregoing clause (A) shall also specify, in the case of any such dividend, distribution or subscription rights, the date on which the holders of preferred stock or Common Stock shall be entitled thereto, and such notice in accordance with

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the foregoing clause (B) shall also specify the date on which the holders of preferred stock or Common Stock shall be entitled to exchange their preferred stock or Common Stock for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, as the case may be.

5. Notice of Adjustments. Whenever the Exercise Price shall be adjusted pursuant to the provisions hereof, the Company shall within ten (10) days of such adjustment deliver a certificate signed on behalf of the Company by its chief financial officer to the holder of this Warrant setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated, and the Exercise Price after giving effect to such adjustment.

6. Fractional Shares. No fractional shares of Preferred Stock or Common Stock will be issued in connection with any exercise hereunder, but in lieu of such fractional shares the Company shall make a cash payment therefor upon the basis of the Exercise Price then in effect.

7. Compliance with Securities Act; Disposition of Warrant or Shares of Preferred Stock

(a) Compliance with Securities Act. The holder of this Warrant, by acceptance hereof, agrees that this Warrant, the shares of Preferred Stock to be issued upon exercise hereof and the Common Stock to be issued upon the conversion of such Preferred Stock, are being acquired for investment purposes only and that such holder will not offer, sell or otherwise dispose of this Warrant or any shares of Preferred Stock to be issued upon exercise hereof (or Common Stock to be issued upon the conversion of such Preferred Stock) except under circumstances which will not result in a violation of the Securities Act of 1933, as amended (the “Act”) and as permitted by Section 7(b) below. This Warrant and all shares of Preferred Stock issued upon exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) shall, unless registered under the Act, be stamped or imprinted with a legend in substantially the following form:

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR (ii) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED, EXCEPT THAT NO SUCH OPINION SHALL BE REQUIRED IF SUCH SALE IS PURSUANT TO RULE 144 PROMULGATED UNDER THE ACT.

(b) Disposition of Warrant and Shares. With respect to any offer, sale or other transfer or disposition of this Warrant or any shares of Preferred Stock acquired pursuant to the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) prior to registration of such Shares, the holder hereof and each subsequent holder of this Warrant agrees to give written notice to the Company prior thereto, describing briefly the manner thereof, together with a written opinion of such holder’s counsel (if reasonably requested by the Company and reasonably satisfactory to the Company) to the effect that (i) such offer, sale or other transfer or disposition may be effected without registration or qualification of this Warrant or such shares of Preferred Stock (or Common Stock to be issued upon the conversion of such Preferred Stock) under the Act as then in effect, and (ii) indicating whether or not under the Act this Warrant or the certificates representing such shares of Preferred Stock or Common Stock to be sold or

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otherwise transferred or disposed of require any restrictive legend thereon in order to ensure compliance with the Act; provided, however, that a written opinion of holder’s counsel shall not be required in connection with any sale pursuant to Rule 144. This Warrant or the certificates representing the shares of Preferred Stock or Common Stock thus transferred (except a transfer pursuant to Rule 144) shall bear a legend as to the applicable restrictions on transferability in order to insure compliance with the Act, unless in the aforesaid opinion of counsel for the holder, such legend is not required in order to insure compliance with the Act. Upon any valid transfer of this Warrant or portion thereof, Company agrees to reissue the Warrant (or Warrants in the case of a partial transfer) and/or the Shares receivable upon the exercise hereof, and if the legend is not required, such re-issuance shall be without said legend. Nothing herein shall restrict the transfer of this Warrant (or any portion hereof) or the certificates representing the shares of Preferred Stock acquired pursuant to the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) by the initial holder hereof or any successor holder to (i) any affiliate of such holder, including without limitation any partnership affiliated with such holder, any partner of any such partnership or any successor corporation to the holder hereof as a result of a merger or consolidation with or a sale of all or substantially all of the stock or assets of the holder, (ii) any legal entity or natural person (hereinafter “Person”) in a public offering pursuant to an effective registration statement under the Act, (iii) to any other Person to the extent that the transfer to such Person is exempt from the registration requirements of the Act and such Person agrees in writing to be bound by all of the restrictions on transfer contained herein, or (iv) any Person or Persons if the holder hereof shall also transfer or assign all or part of its interest in the Financing Arrangement and such Person agrees in writing to be bound by all of the restrictions on transfer contained herein. Any transfer described above must be made in compliance with all applicable federal and state securities laws. The Company may issue stop transfer instructions to its transfer agent in connection with the foregoing restrictions.

8. Warrantholder’s Representations

(a) The Warrantholder acknowledges that it has had access to all material information concerning the Company which it has requested. The Warrantholder also acknowledges that it has had the opportunity to, and has to its satisfaction, questioned the officers of the Company with respect to its investment hereunder. The Warrantholder represents that it understands that the Warrant and the Preferred Stock (and the shares of Common Stock issuable upon conversion of the Preferred Stock) are speculative investments, that it is aware of the Company’s business affairs and financial condition and that it has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Warrant. The Warrantholder is purchasing the Warrant and any Preferred Stock issued upon exercise thereof (and the shares of Common Stock issuable upon conversion of the Preferred Stock) for investment for its own account only and not with a view to, or for resale in connection with, any “distribution” thereof in violation of the Act or applicable state securities laws. The Warrantholder further represents that it understands that the Warrant and Preferred Stock have not been registered under the Act or applicable state securities laws by reason of specific exemptions therefrom, which exemptions depend upon, among other things, the bona fide nature of the Warrantholder’s investment intent as expressed herein. The Warrantholder is an “accredited investor” as defined in Regulation D promulgated under the Act. The Warrantholder’s corporate headquarters and principal place of business is located in the State of Illinois.

9. Company’s Representations

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As a material inducement to the Warrantholder to purchase this Warrant, the Company hereby represents and warrants that:

(a) The Company shall have made all filings under applicable federal and state securities laws necessary to consummate the issuance of this Warrant pursuant to this Agreement in compliance with such laws, except for such filings as may be made properly after the Grant Date.

(b) If there are parties to any stock purchase agreements whose consent or approval is required prior to the execution and delivery of this Warrant, the Company and any such parties shall have entered into an amendment to each such stock purchase agreement to provide for such consent and any required waivers, in such form and substance acceptable to the Warrantholder, and such amendment shall be in full force and effect as of the date hereof.

(c) If there are parties to any investor’s rights agreements whose consent or approval is required prior to the execution and delivery of this Warrant, the Company and any such parties shall have entered into an amendment to each such investor’s rights agreement providing for such consent and any required waivers, in such form and substance acceptable to Warrantholder, and such amendment shall be in full force and effect as of the date hereof.

(d) The copies of any existing stock purchase agreements and investor’s rights agreements and the Company’s charter documents and bylaws which have been furnished to Warrantholder or the Warrantholder’s counsel reflect all amendments made thereto at any time prior to the date hereof and are correct and complete.

(e) As of the date hereof, the authorized capital stock of the Company shall be as stated on the Capitalization Schedule attached hereto as Exhibit B (the “Capitalization Schedule”) and made a part hereof. As of the date hereof, except for this Warrant and except as set forth on the attached Capitalization Schedule, the Company shall not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights, warrants or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans. The Capitalization Schedule truthfully and accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company’s capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the date hereof, except as set forth on the Capitalization Schedule, the Company shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock. As of the date hereof, all of the outstanding shares of the Company’s capital stock shall be validly issued, fully paid and nonassessable.

(f) With respect to the issuance of this Warrant or the issuance of the Preferred Stock upon exercise of the Warrant (and the shares of Common Stock issuable upon conversion of the Preferred Stock), there are no statutory or contractual stockholders preemptive rights or rights of refusal, except for any such rights contained in any stock purchase agreement and/or investor’s rights agreements which have been waived. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of this Warrant does not require registration under the Act or any applicable state securities laws. To

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the best of the Company’s knowledge, there are no agreements between the Company’s stockholders with respect to the voting or transfer of the Company’s capital stock or with respect to any other aspect of the Company’s affairs, except for any stock purchase agreements and any investor’s rights agreements identified on the attached Capitalization Schedule.

(g) The execution, delivery and performance of this Warrant has been duly authorized by the Company. This Warrant constitutes a valid and binding obligation of the Company, enforceable in accordance with its terms. The execution and delivery by the Company of this Warrant, the issuance of the Preferred Stock upon exercise of this Warrant (and the shares of Common Stock issuable upon conversion of the Preferred Stock), and the fulfillment of and compliance with the respective terms hereof and thereof by the Company, do not and shall not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default under, (iii) result in the creation of any lien, security interest, charge or encumbrance upon the Company’s capital stock or assets pursuant to, (iv) give any third party the right to modify, terminate or accelerate any obligation under, (v) result in a violation of, or (vi) require any authorization, consent, approval, exemption or other action by or notice or declaration to, or filing with, any court or administrative or governmental body or agency pursuant to, the charter or bylaws of the Company or any subsidiary, or any law, statute, rule or regulation to which the Company or any subsidiary is subject, or any agreement, instrument, order, judgment or decree to which the Company or any subsidiary is subject, except for any such filings required under applicable “blue sky” or state securities laws or required under Regulation D promulgated under the Act.

10. Company Financial Information.

Until such time as the Company shall have satisfied all of its obligations under the Financing Arrangement, Company shall deliver to Warrantholder such financial information as is required under the terms of the Financing Arrangement. From and after the date that the Company shall have satisfied all of its obligations under the Financing Arrangement, and notwithstanding any other agreement to the contrary between the parties hereto, the Company shall deliver to the Warrantholder (so long as the Warrantholder holds all or any portion of the Warrant or any Preferred Stock or any shares of Common Stock issuable upon conversion of the Preferred Stock) all of the financial and other information delivered or required to be delivered by the Company to any of its stockholders. All such financial and other information shall be delivered pursuant to this Section 10 on a timely basis, but no later than 30 days after each fiscal quarter end for quarterly statements and no later than 120 days after each fiscal year end for annual statements.

11. Miscellaneous

(a) Rights as Shareholders. No holder of this Warrant, as such, shall be entitled to vote or receive dividends or be deemed the holder of Preferred Stock (or Common Stock to be issued upon the conversion of such Preferred Stock) or otherwise be entitled to any voting or other rights as a shareholder of the Company, until this Warrant shall have been exercised and the Shares purchasable upon the exercise shall have become deliverable, as provided herein.

(b) Issuance Tax. The issuance of certificates for shares of Preferred Stock upon exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) shall be made without charge to the holder hereof for any issuance tax in respect hereof, provided that the Company shall not be required to pay any tax which may be payable in

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respect of any transfer involved in the issuance and delivery of any certificate in a name other than that of the holder of this Warrant.

(c) Modification and Waiver. This Warrant and any provision hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the Company and the holder of this Warrant.

(d) Attorneys’ Fees. In the event of an action, suit or proceeding brought under or in connection herewith, the prevailing party therein shall be entitled to recover from, and the other party hereto agrees to pay, the prevailing party’s costs and expenses in connection therewith, including reasonably attorneys’ fees.

(e) Notices. All notices, demands or other communications required or permitted to be given or delivered under or by reason of the provisions hereof shall be in writing and shall be deemed to have been given when (i) delivered personally to the recipient, (ii) sent via facsimile transmission, (iii) the next business day after having been sent to the recipient by reputable overnight courier service (charges prepaid) or (iv) four business days after having been mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid. Such notices, demands and other communications shall be sent to the Warrantholder and to the Company at the respective addresses and transmission numbers indicated on the signature page hereof, or to such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.

(f) Binding Effect on Successors. This Warrant and the terms hereof shall be binding upon any corporation succeeding the Company by merger, consolidation or acquisition of all or substantially all of the Company’s assets, and all of the obligations of the Company relating to the Preferred Stock issuable upon the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) or any New Warrant (and the securities issuable thereunder) shall survive the exercise and termination of this Warrant (or any New Warrant) and all of the covenants and agreements of the Company shall inure to the benefit of the successors and assigns of the holder hereof. All covenants and agreements contained herein by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not.

(g) Lost Warrants or Stock Certificates. The Company covenants to the holder hereof that upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of this Warrant or any stock certificate issued upon exercise hereof or in replacement thereafter and, in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company and without requiring any bond, or in the case of any such mutilation upon surrender and cancellation of such Warrant or stock certificate, the Company will make and deliver a replacement Warrant or stock certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate.

(h) Registration Agreement. The Warrantholder shall be entitled, with respect to the shares of Preferred Stock issuable upon exercise of this Warrant or the shares of Common Stock issuable upon conversion of the Preferred Stock, to all of the “piggyback registration” rights set forth in Section 2.3 of that certain Investors’ Rights Agreement dated January 27, 2003 and February 7, 2003 (as the same may be amended from time to time, the “IRA”) in effect as of Grant Date among the Company and the parties thereto including the investors listed on any one or more Schedules thereto, on the terms and conditions set forth therein, as if such terms and conditions were set forth in this Warrant. A copy of said IRA has been provided to the

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Warrantholder. Simultaneously with the execution of this Warrant, the Warrantholder shall execute, at the option of the Issuer, either a counterpart signature page to such IRA, or an amendment to the IRA, either of which document shall add the Warrantholder as a party thereto and give the Warrantholder such piggyback registration rights to the extent provided therein. Company and the Purchaser hereby further agree that for the purposes of the IRA, the Shares issuable upon exercise of this Warrant are “Registrable Securities,” as that term is defined in the Investors’ Rights Agreement.

(i) Market Stand-off Provision. Warrantholder hereby agrees that, during the period of duration not to exceed 180 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of the first registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, and, for a period of duration not to exceed 90 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of any subsequent registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, it shall not, to the extent requested by the Company and such underwriter, directly or indirectly, sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound), or reduce its interest in (collectively, “Transfer”), any Shares issuable upon exercise of this Warrant during such period except Common Stock included in such registration. Such restrictions, however, shall not be applicable to transfers to any affiliated entity of Warrantholder, including any affiliated corporation, partnership, limited partnership, limited liability company or investment fund, or to any stockholders, partners, general partners, limited partners and members of Warrantholder, in each case who agree in writing to be bound by this Warrant, including this Section. To enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Company’s securities held by Warrantholder (and the shares or securities of every other person or entity subject to the foregoing restriction) until the end of such period.

(j) Descriptive Headings. The descriptive headings of the several paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant.

(k) Governing Law. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF THE STATE WHERE THE COMPANY IS INCORPORATED.

SIGNATURE PAGE FOLLOWS:

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In Witness Whereof, this Warrant to purchase Preferred Stock has been duly executed as of the Grant Date hereinabove set forth.

Issued By:		Accepted By:
Danger, Inc.		Heller Financial Leasing, Inc.
By:	/s/ Henry R. Nothhaft	By:	/s/ Charles Arkin
Title:	CEO	Title:	AVP
Address for Notices:		Address for Notices:
3101 Park Blvd. Palo Alto, CA 94306		500 West Monroe Chicago, IL 60661
Attention: Andrew Missan, VP and General Counsel		Attention: Portfolio Management, GE Capital Technology Finance
Fax: 650-289-5001
		Fax: 312-876-2593
With a copy to:
O’Melvany & Meyers
Attention: David Makarechian
2765 Sand Hill Road Menlo Park, CA 94025-7019
Tel: (650) 473-2600
Fax: (650) 473-2601

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EXHIBIT A

Notice of Exercise

To: ISSUER NAME (“Company”)

ISSUER ADDRESS

Attention: Chief Financial Officer

[1. The undersigned hereby elects to purchase                                          shares of Series [    ] Convertible Preferred Stock of Company pursuant to the terms of the attached Warrants, and tenders herewith payment of the purchase price of such shares in full.]

[1. The undersigned hereby elects to purchase                                          shares of Series [    ] Convertible Preferred Stock of Company pursuant to a non-cash exercise of the Warrant as provided in Section 2.2 of the Warrant.]

2. Check here if applicable:      The undersigned confirms that this exercise is made in connection with the occurrence of a public offering, sale or merger of the Company, and the undersigned further elects to condition this exercise of the Warrant upon the consummation of said public offering, sale or merger of the Company. This exercise shall not be deemed to be effective until the consummation of such transaction. In the event that transaction is not consummated within 45 days of the targeted date of the transaction, the undersigned will advise Company whether or not this exercise should be deemed rescinded.

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

Heller Financial Leasing, Inc.

500 West Monroe

Chicago, IL 60661

3. The undersigned represents that the aforesaid shares are being acquired for the account of the undersigned for investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing such shares.

Heller Financial Leasing, Inc.
By:
	(Signature)
Its:
Date:

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EX-4.7

Exhibit 4.7

NEITHER THIS WARRANT NOR THE SHARES OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). NO SALE, TRANSFER OR OTHER DISPOSITION OF THIS WARRANT OR SAID SHARES MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR (ii) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED, EXCEPT THAT NO SUCH OPINION SHALL BE REQUIRED IF SUCH SALE IS PURSUANT TO RULE 144 PROMULGATED UNDER THE ACT.

Warrant No.: W-PD-21

WARRANT

TO PURCHASE

SHARES OF SERIES D CONVERTIBLE PREFERRED STOCK

THIS CERTIFIES THAT, for good and valuable consideration received from Heller Financial Leasing, Inc., a GE Company (“Warrantholder”), Warrantholder is entitled to subscribe for and purchase Six Thousand Five Hundred and Eighty-Eight (6,588) shares (as adjusted pursuant to provisions hereof, the “Shares”) of the fully paid and non-assessable Series D Convertible Preferred Stock of Danger, Inc., a Delaware corporation with its principal place of business at 3101 Park Blvd., Palo Alto, CA 94306 (the “Company”), at an exercise price per share of $0.9007 (such price and such other price as shall result, from time to time, from adjustments specified herein, is hereafter referred to as the “Exercise Price”), subject to the provisions and upon the terms and conditions hereinafter set forth. As used herein, the term “Preferred Stock” or “Shares” shall mean the Company’s presently authorized Series D Convertible Preferred Stock, and any stock into or for which such Series D Convertible Preferred Stock may hereafter be converted or exchanged pursuant to the Certificate of Incorporation of the Company as from time to time amended as provided by law and in such Certificate. As used herein, term “Grant Date” shall mean September 24, 2004. The Company acknowledges that the cash consideration paid by Warrantholder for this Warrant is $10.00 for income tax purposes, that such amount has been duly received by the Company, and that this Warrant is issued in connection with that certain financial accommodation entered into by and between Company as the obligor and Warrantholder as the obligee thereunder (the “Financing Arrangement”).

In the event that all preferred stock is mandated to be converted into Common Stock, this Warrant shall be exercisable solely for such Common Stock, and any reference throughout this Warrant to shares of Preferred Stock shall be deemed to refer to the shares of Common Stock into which the Preferred Stock may be converted in accordance with the conversion formula set forth in the Company’s Certificate of Incorporation, as amended from time to time.

1. Term. The purchase rights represented by this Warrant are exercisable, in whole or in part, at any time and from time to time, from and after the Grant Date and on or prior to the seventh (7^th) anniversary of the Grant Date.

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2. Method of Exercise; Net Issue Exercise.

2.1 Method of Exercise; Payment; Issuance of New Warrant. The purchase rights represented by this Warrant may be exercised by the Warrantholder, in whole or in part and from time to time, by the surrender of this Warrant (with the notice of exercise form attached hereto as Exhibit A duly executed) at the principal office of the Company and by the payment to the Company of an amount equal to the then applicable Exercise Price per share multiplied by the number of Shares then being purchased. The Warrantholder shall be deemed to have become the holder(s) of record of, and shall be treated for all purposes as the record holder(s) of, the Shares represented thereby (and such Shares shall be deemed to have been issued) immediately prior to the close of business on the date or dates upon which this Warrant is exercised. In the event of any exercise of the rights represented by this Warrant, certificates for the Shares so purchased shall be promptly delivered to the holder hereof as soon as possible (and in any event within five business days of receipt of such notice) and, unless this Warrant has been fully exercised, a new warrant representing the portion of the Shares, if any, with respect to which this Warrant shall not then have been exercised shall also be issued to the holder hereof as soon as possible (and in any event within such five business day period).

2.2 Non-Cash Exercise.

(a) In lieu of payment in cash, the rights represented by this Warrant may also be exercised by a written notice of exercise in the form of Exhibit A attached hereto, providing for the non-cash exercise of this Warrant for the Shares equal to the value (as determined below) of this Warrant (or the portion thereof being exercised), specifying that this non-cash exercise election has been made, and the net number of Shares to be issued after giving effect to such non-cash exercise. In the event the Warrantholder makes such election, Company shall issue to the holder a number of shares computed using the following formula:

	X =	Y(A-B)
		A
Where:
	X =	the number of Shares to be issued to the holder
	Y =	the number of Shares purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised (as of the date of such non-cash exercise)
	A =	the Fair Market Value of one Share of Preferred Stock (as of the date of such non-cash exercise)
	B =	Exercise Price of one Share of Preferred Stock (as adjusted to the date of such non-cash exercise)

(b) For purposes of this Section 2.2, the “Fair Market Value” of one share of the Company’s Preferred Stock shall be equal to the number of shares of Common Stock into which each share of Preferred Stock is convertible as of the date of the exercise, multiplied by the “Fair Market Value” of a share of Common Stock (as determined pursuant to this Section 2.2). The Fair Market Value of one share of the Company’s Common Stock shall be equal to either (i) if the exercise of this Warrant occurs in connection with an initial public offering of the Company, then the Fair Market Value shall be equal to the “initial price to public” specified in the final prospectus with respect to the initial public offering, or (ii) if the exercise of this Warrant occurs after an initial public offering of the Company but not in connection therewith, then the Fair Market Value shall be equal to the average of the closing

price(s) of the Company’s Common

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Stock as quoted over the counter or on any exchange on which the Common Stock is listed as such closing prices are published in The Wall Street Journal for the fifteen trading days (or such lesser number of trading days as the stock may have been actually trading) ending on the day prior to the date of determination of Fair Market Value. Notwithstanding the foregoing, if the Warrant is exercised in connection with a merger or sale of all or substantially all of the Company’s assets, Fair Market Value shall mean the value that would have been allocable to or received in respect of a Warrant Share had the Warrant been exercised prior to such merger or sale. If the Common Stock is not traded Over-The-Counter or on an exchange, or if the Warrant is not exercised in connection with a merger or sale of all or substantially all of its assets, the Fair Market Value shall be determined in good faith by the Company’s board of directors. If the holder hereof does not agree with the determination of Fair Market Value as determined by the Company’s board of directors, the Company and the holder hereof shall negotiate an appropriate Fair Market Value. If after ten (10) days, the Company and the holder cannot agree, then the holder may request that the Fair Market Value be determined by an investment banker of national reputation selected by the Company and reasonably acceptable to the Warrantholder. The fees and expenses of such investment banker shall be borne by the Company unless the Fair Market Value determined by such investment banker is equal to or less than the Fair Market Value as determined by the Company, in which event the fees and expenses of such investment banker shall be borne by the holder hereof.

2.3 Exercise Into Common Stock. Upon any exercise of this Warrant, at the election of the holder, this Warrant may be exercised into the number of shares of Common Stock into which the Shares issuable upon such exercise are then convertible.

2.4 Automatic Exercise. Immediately before the expiration or termination of this Warrant, to the extent this Warrant is not previously exercised, and if the Fair Market Value of one share of whichever is applicable of either (i) the Preferred Stock subject to this Warrant or (ii) the Company’s Common Stock issuable upon conversion of the Preferred Stock subject to this Warrant, is greater than the Exercise Price, then in effect as adjusted pursuant to this Warrant, then this Warrant shall be deemed automatically exercised pursuant to Section 2.2 above, even if not surrendered. For purposes of such automatic exercise, the Fair Market Value of the Company’s Common Stock upon such expiration shall be determined pursuant to Section 2.2 (b) above. To the extent this Warrant or any portion thereof is deemed automatically exercised pursuant to this Section, the Company agrees to promptly notify the Warrantholder of the number of Shares, if any, the holder hereof is to receive by reason of such automatic exercise.

2.5 Exercise in Connection with an Initial Public Offering, Sale or Merger. Notwithstanding any other provision hereof, if the exercise of all or any portion of this Warrant is made or to be made in connection with the occurrence of a public offering, sale or merger of the Company, the exercise of all or any portion of this Warrant shall, at the election of the Warrantholder, be conditioned upon the consummation of the public offering, sale or merger of the Company, in which case such exercise shall not be deemed to be effective until the consummation of such transaction. In the event that the transaction is not consummated within 45 days of the targeted date of the transaction, any such exercise shall, at the election of the Warrantholder, be deemed rescinded.

3. Stock Fully Paid; Reservation of Shares. All Shares that may be issued upon the exercise of the rights represented by this Warrant and Common Stock issuable upon conversion of the Preferred Stock will, upon issuance, be validly issued, fully paid and non-assessable, issued in compliance with all applicable federal and state securities laws, and free from all taxes, liens and charges with respect to the issue thereof. During the period within which the rights

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represented by this Warrant may be exercised, the Company will at all times have authorized and reserved for the purpose of issuance upon exercise of the purchase rights evidenced by this Warrant, a sufficient number of shares of its Preferred Stock (and Common Stock issuable upon conversion of the Preferred Stock) to provide for the exercise of the rights represented by this Warrant.

4. Adjustment of Exercise Price and Number of Shares. The number of Shares purchasable upon the exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time upon the occurrence of certain events, as follows:

(a) Reclassification, Reorganization, Change or Conversion. In case of any reclassification, reorganization, change or conversion of securities of the class issuable upon exercise of this Warrant (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), then in any of these events, the Company shall execute a replacement warrant (a “New Warrant”), in form and substance reasonably satisfactory to the holder of this Warrant, upon the exercise of which (and at a total purchase price under the New Warrant not to exceed that payable upon the exercise in full of this Warrant) the holder of the New Warrant shall receive, in lieu of each Share receivable upon the exercise of this Warrant, the same kind and amount of shares of stock, other securities, money and property receivable by a holder of one share of Preferred Stock upon such reclassification, reorganization, change or conversion. Such New Warrant shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 4. The provisions of this section (a) shall similarly apply to successive reclassifications, reorganizations, changes, or conversions.

(b) Merger or Sale. In case of any (i) consolidation or merger of the Company with or into another corporation or entity (other than a merger with another corporation or entity in which the Company is the surviving corporation and which does not result in any reclassification or change of outstanding securities issuable upon exercise of this Warrant), or (ii) sale of all or substantially all of the assets of the Company, then in either of such events, the Company, or such successor or purchasing corporation, as the case may be, shall execute a replacement warrant (a “New Warrant”), in form and substance satisfactory to the holder of this Warrant, upon the exercise of which (and at a total purchase price under the New Warrant not to exceed that payable upon the exercise in full of this Warrant) provides that the holder of the New Warrant shall have the right to exercise such New Warrant and upon such exercise to receive, in lieu of each share of Preferred Stock theretofore issuable upon exercise of this Warrant, the kind and amount of shares of stock, other securities, money and property allocable to or receivable by a holder of one share of Preferred Stock upon such reclassification, change, consolidation, merger or sale. Such New Warrant shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 4. The provisions of this section (b) shall similarly apply to successive mergers and sales.

(c) Subdivisions or Combination of Shares; Stock Dividends. In the event that the Company shall at any time subdivide the outstanding shares of Preferred Stock, or shall issue a stock dividend on its outstanding shares of Preferred Stock, the number of Shares issuable upon exercise of this Warrant immediately prior to such subdivision or immediately prior to the issuance of such stock dividend shall be proportionately increased, and the Exercise Price shall be proportionately decreased, and in the event that the Company shall at any time combine the outstanding shares of Preferred Stock, the number of Shares issuable upon exercise of this Warrant immediately prior to such combination shall be proportionately decreased, and the

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Exercise Price shall be proportionately increased, effective at the close of business on the date of such subdivision, stock dividend or combination, as the case may be.

(d) Issuance of Additional Shares In the event that the Company shall at any time make an issuance of “Additional Shares” for consideration (calculated after giving effect to the price at which any preferred shares may be converted to Common Stock) which is less than the Exercise Price per share, then the price at which the Shares may be converted into the Company’s Common Stock shall be subject to the same adjustment to the price at which the Company’s preferred stock may be converted into the Company’s Common Stock as such adjustment is set forth in the Company’s Certificate of Incorporation (as may be amended from time to time), and such adjustment shall be effective as to the Shares receivable upon the exercise of this Warrant regardless of whether or not such conversion price adjustment under such Articles requires the actual issuance of the affected preferred shares. “Additional Shares” shall be defined as the issuance of additional shares of any series of preferred stock or of Common Stock as set forth in the Company’s Certificate of Incorporation. The holder acknowledges that any adjustment to the conversion price arises solely from the Company’s Certificate of Incorporation, and that no additional rights to adjustment based on the issuance of additional shares is created hereby.

(e) No Impairment. The Company will not, by amendment of its Certificate of Incorporation or any other organizational or shareholder rights documents of the Company, or through any reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Section 4 and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment.

(f) Notices of Record Date. In case at any time:

(i) the Company shall declare any dividend upon its Preferred Stock or Common Stock payable in cash or stock or make any other distribution to the holders of its Preferred Stock or its Common Stock;

(ii) the Company shall offer for subscription pro rata to the holders of its Preferred Stock any additional shares of stock of any class, or other rights;

(iii) there shall be any capital reorganization or reclassification of the capital stock of the Company, or a consolidation or merger of the Company with or into, or a sale of all or substantially all its assets to another entity or entities; or

(iv) there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company;

then, in any one or more of said cases, the Company shall give notice as provided in Section 11(f) hereunder as follows: (A) at least 30 days’ prior written notice of the date on which the books of the Company shall close or a record shall be taken for such dividend, distribution or subscription rights or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, and (B) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, at least 30 days’ prior written notice of the date when the same shall take place. Such notice in accordance with the foregoing clause (A) shall also specify, in the

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case of any such dividend, distribution or subscription rights, the date on which the holders of preferred stock or Common Stock shall be entitled thereto, and such notice in accordance with the foregoing clause (B) shall also specify the date on which the holders of preferred stock or Common Stock shall be entitled to exchange their preferred stock or Common Stock for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, as the case may be.

5. Notice of Adjustments. Whenever the Exercise Price shall be adjusted pursuant to the provisions hereof, the Company shall within ten (10) days of such adjustment deliver a certificate signed on behalf of the Company by its chief financial officer to the holder of this Warrant setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated, and the Exercise Price after giving effect to such adjustment.

6. Fractional Shares. No fractional shares of Preferred Stock or Common Stock will be issued in connection with any exercise hereunder, but in lieu of such fractional shares the Company shall make a cash payment therefor upon the basis of the Exercise Price then in effect.

7. Compliance with Securities Act; Disposition of Warrant or Shares of Preferred Stock

(a) Compliance with Securities Act. The holder of this Warrant, by acceptance hereof, agrees that this Warrant, the shares of Preferred Stock to be issued upon exercise hereof and the Common Stock to be issued upon the conversion of such Preferred Stock, are being acquired for investment purposes only and that such holder will not offer, sell or otherwise dispose of this Warrant or any shares of Preferred Stock to be issued upon exercise hereof (or Common Stock to be issued upon the conversion of such Preferred Stock) except under circumstances which will not result in a violation of the Securities Act of 1933, as amended (the “Act”) and as permitted by Section 7(b) below. This Warrant and all shares of Preferred Stock issued upon exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) shall, unless registered under the Act, be stamped or imprinted with a legend in substantially the following form:

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR (ii) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED, EXCEPT THAT NO SUCH OPINION SHALL BE REQUIRED IF SUCH SALE IS PURSUANT TO RULE 144 PROMULGATED UNDER THE ACT.

(b) Disposition of Warrant and Shares. With respect to any offer, sale or other transfer or disposition of this Warrant or any shares of Preferred Stock acquired pursuant to the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) prior to registration of such Shares, the holder hereof and each subsequent holder of this Warrant agrees to give written notice to the Company prior thereto, describing briefly the manner thereof, together with a written opinion of such holder’s counsel (if reasonably requested by the Company and reasonably satisfactory to the Company) to the effect that (i) such offer, sale or other transfer or disposition may be effected without registration or qualification of this Warrant or such shares of Preferred Stock (or Common Stock to be issued upon the conversion of such Preferred Stock) under the Act as then in effect, and (ii) indicating whether or not under the Act this Warrant or

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the certificates representing such shares of Preferred Stock or Common Stock to be sold or otherwise transferred or disposed of require any restrictive legend thereon in order to ensure compliance with the Act; provided, however, that a written opinion of holder’s counsel shall not be required in connection with any sale pursuant to Rule 144. This Warrant or the certificates representing the shares of Preferred Stock or Common Stock thus transferred (except a transfer pursuant to Rule 144) shall bear a legend as to the applicable restrictions on transferability in order to insure compliance with the Act, unless in the aforesaid opinion of counsel for the holder, such legend is not required in order to insure compliance with the Act. Upon any valid transfer of this Warrant or portion thereof, Company agrees to reissue the Warrant (or Warrants in the case of a partial transfer) and/or the Shares receivable upon the exercise hereof, and if the legend is not required, such re-issuance shall be without said legend. Nothing herein shall restrict the transfer of this Warrant (or any portion hereof) or the certificates representing the shares of Preferred Stock acquired pursuant to the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) by the initial holder hereof or any successor holder to (i) any affiliate of such holder, including without limitation any partnership affiliated with such holder, any partner of any such partnership or any successor corporation to the holder hereof as a result of a merger or consolidation with or a sale of all or substantially all of the stock or assets of the holder, (ii) any legal entity or natural person (hereinafter “Person”) in a public offering pursuant to an effective registration statement under the Act, (iii) to any other Person to the extent that the transfer to such Person is exempt from the registration requirements of the Act and such Person agrees in writing to be bound by all of the restrictions on transfer contained herein, or (iv) any Person or Persons if the holder hereof shall also transfer or assign all or part of its interest in the Financing Arrangement and such Person agrees in writing to be bound by all of the restrictions on transfer contained herein. Any transfer described above must be made in compliance with all applicable federal and state securities laws. The Company may issue stop transfer instructions to its transfer agent in connection with the foregoing restrictions.

8. Warrantholder’s Representations

(a) The Warrantholder acknowledges that it has had access to all material information concerning the Company which it has requested. The Warrantholder also acknowledges that it has had the opportunity to, and has to its satisfaction, questioned the officers of the Company with respect to its investment hereunder. The Warrantholder represents that it understands that the Warrant and the Preferred Stock (and the shares of Common Stock issuable upon conversion of the Preferred Stock) are speculative investments, that it is aware of the Company’s business affairs and financial condition and that it has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Warrant. The Warrantholder is purchasing the Warrant and any Preferred Stock issued upon exercise thereof (and the shares of Common Stock issuable upon conversion of the Preferred Stock) for investment for its own account only and not with a view to, or for resale in connection with, any “distribution” thereof in violation of the Act or applicable state securities laws. The Warrantholder further represents that it understands that the Warrant and Preferred Stock have not been registered under the Act or applicable state securities laws by reason of specific exemptions therefrom, which exemptions depend upon, among other things, the bona fide nature of the Warrantholder’s investment intent as expressed herein. The Warrantholder is an “accredited investor” as defined in Regulation D promulgated under the Act. The Warrantholder’s corporate headquarters and principal place of business is located in the State of Illinois.

9. Company’s Representations

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As a material inducement to the Warrantholder to purchase this Warrant, the Company hereby represents and warrants that:

(a) The Company shall have made all filings under applicable federal and state securities laws necessary to consummate the issuance of this Warrant pursuant to this Agreement in compliance with such laws, except for such filings as may be made properly after the Grant Date.

(b) If there are parties to any stock purchase agreements whose consent or approval is required prior to the execution and delivery of this Warrant, the Company and any such parties shall have entered into an amendment to each such stock purchase agreement to provide for such consent and any required waivers, in such form and substance acceptable to the Warrantholder, and such amendment shall be in full force and effect as of the date hereof.

(c) If there are parties to any investor’s rights agreements whose consent or approval is required prior to the execution and delivery of this Warrant, the Company and any such parties shall have entered into an amendment to each such investor’s rights agreement providing for such consent and any required waivers, in such form and substance acceptable to Warrantholder, and such amendment shall be in full force and effect as of the date hereof.

(d) The copies of any existing stock purchase agreements and investor’s rights agreements and the Company’s charter documents and bylaws which have been furnished to Warrantholder or the Warrantholder’s counsel reflect all amendments made thereto at any time prior to the date hereof and are correct and complete.

(e) As of the date hereof, the authorized capital stock of the Company shall be as stated on the Capitalization Schedule attached hereto as Exhibit B (the “Capitalization Schedule”) and made a part hereof. As of the date hereof, except for this Warrant and except as set forth on the attached Capitalization Schedule, the Company shall not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights, warrants or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans. The Capitalization Schedule truthfully and accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company’s capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the date hereof, except as set forth on the Capitalization Schedule, the Company shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock. As of the date hereof, all of the outstanding shares of the Company’s capital stock shall be validly issued, fully paid and nonassessable.

(f) With respect to the issuance of this Warrant or the issuance of the Preferred Stock upon exercise of the Warrant (and the shares of Common Stock issuable upon conversion of the Preferred Stock), there are no statutory or contractual stockholders preemptive rights or rights of refusal, except for any such rights contained in any stock purchase agreement and/or investor’s rights agreements which have been waived. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of this Warrant does not require registration under the Act or any applicable state securities laws. To

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the best of the Company’s knowledge, there are no agreements between the Company’s stockholders with respect to the voting or transfer of the Company’s capital stock or with respect to any other aspect of the Company’s affairs, except for any stock purchase agreements and any investor’s rights agreements identified on the attached Capitalization Schedule.

(g) The execution, delivery and performance of this Warrant has been duly authorized by the Company. This Warrant constitutes a valid and binding obligation of the Company, enforceable in accordance with its terms. The execution and delivery by the Company of this Warrant, the issuance of the Preferred Stock upon exercise of this Warrant (and the shares of Common Stock issuable upon conversion of the Preferred Stock), and the fulfillment of and compliance with the respective terms hereof and thereof by the Company, do not and shall not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default under, (iii) result in the creation of any lien, security interest, charge or encumbrance upon the Company’s capital stock or assets pursuant to, (iv) give any third party the right to modify, terminate or accelerate any obligation under, (v) result in a violation of, or (vi) require any authorization, consent, approval, exemption or other action by or notice or declaration to, or filing with, any court or administrative or governmental body or agency pursuant to, the charter or bylaws of the Company or any subsidiary, or any law, statute, rule or regulation to which the Company or any subsidiary is subject, or any agreement, instrument, order, judgment or decree to which the Company or any subsidiary is subject, except for any such filings required under applicable “blue sky” or state securities laws or required under Regulation D promulgated under the Act.

10. Company Financial Information.

Until such time as the Company shall have satisfied all of its obligations under the Financing Arrangement, Company shall deliver to Warrantholder such financial information as is required under the terms of the Financing Arrangement. From and after the date that the Company shall have satisfied all of its obligations under the Financing Arrangement, and notwithstanding any other agreement to the contrary between the parties hereto, the Company shall deliver to the Warrantholder (so long as the Warrantholder holds all or any portion of the Warrant or any Preferred Stock or any shares of Common Stock issuable upon conversion of the Preferred Stock) all of the financial and other information delivered or required to be delivered by the Company to any of its stockholders. All such financial and other information shall be delivered pursuant to this Section 10 on a timely basis, but no later than 30 days after each fiscal quarter end for quarterly statements and no later than 120 days after each fiscal year end for annual statements.

11. Miscellaneous

(a) Rights as Shareholders. No holder of this Warrant, as such, shall be entitled to vote or receive dividends or be deemed the holder of Preferred Stock (or Common Stock to be issued upon the conversion of such Preferred Stock) or otherwise be entitled to any voting or other rights as a shareholder of the Company, until this Warrant shall have been exercised and the Shares purchasable upon the exercise shall have become deliverable, as provided herein.

(b) Issuance Tax. The issuance of certificates for shares of Preferred Stock upon exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) shall be made without charge to the holder hereof for any issuance tax in respect hereof, provided that the Company shall not be required to pay any tax which may be payable in

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respect of any transfer involved in the issuance and delivery of any certificate in a name other than that of the holder of this Warrant.

(c) Modification and Waiver. This Warrant and any provision hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the Company and the holder of this Warrant.

(d) Attorneys’ Fees. In the event of an action, suit or proceeding brought under or in connection herewith, the prevailing party therein shall be entitled to recover from, and the other party hereto agrees to pay, the prevailing party’s costs and expenses in connection therewith, including reasonably attorneys’ fees.

(e) Notices. All notices, demands or other communications required or permitted to be given or delivered under or by reason of the provisions hereof shall be in writing and shall be deemed to have been given when (i) delivered personally to the recipient, (ii) sent via facsimile transmission, (iii) the next business day after having been sent to the recipient by reputable overnight courier service (charges prepaid) or (iv) four business days after having been mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid. Such notices, demands and other communications shall be sent to the Warrantholder and to the Company at the respective addresses and transmission numbers indicated on the signature page hereof, or to such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.

(f) Binding Effect on Successors. This Warrant and the terms hereof shall be binding upon any corporation succeeding the Company by merger, consolidation or acquisition of all or substantially all of the Company’s assets, and all of the obligations of the Company relating to the Preferred Stock issuable upon the exercise of this Warrant (or Common Stock to be issued upon the conversion of such Preferred Stock) or any New Warrant (and the securities issuable thereunder) shall survive the exercise and termination of this Warrant (or any New Warrant) and all of the covenants and agreements of the Company shall inure to the benefit of the successors and assigns of the holder hereof. All covenants and agreements contained herein by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not.

(g) Lost Warrants or Stock Certificates. The Company covenants to the holder hereof that upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of this Warrant or any stock certificate issued upon exercise hereof or in replacement thereafter and, in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company and without requiring any bond, or in the case of any such mutilation upon surrender and cancellation of such Warrant or stock certificate, the Company will make and deliver a replacement Warrant or stock certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate.

(h) Registration Agreement. The Warrantholder shall be entitled, with respect to the shares of Preferred Stock issuable upon exercise of this Warrant or the shares of Common Stock issuable upon conversion of the Preferred Stock, to all of the “piggyback registration” rights set forth in Section 2.3 of that certain Investors’ Rights Agreement dated January 27, 2003 and February 7, 2003 (as the same may be amended from time to time, the “IRA”) in effect as of Grant Date among the Company and the parties thereto including the investors listed on any one or more Schedules thereto, on the terms and conditions set forth therein, as if such terms and conditions were set forth in this Warrant. A copy of said IRA has been provided to the

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Warrantholder. Simultaneously with the execution of this Warrant, the Warrantholder shall execute, at the option of the Issuer, either a counterpart signature page to such IRA, or an amendment to the IRA, either of which document shall add the Warrantholder as a party thereto and give the Warrantholder such piggyback registration rights to the extent provided therein. Company and the Purchaser hereby further agree that for the purposes of the IRA, the Shares issuable upon exercise of this Warrant are “Registrable Securities,” as that term is defined in the Investors’ Rights Agreement.

(i) Market Stand-off Provision. Warrantholder hereby agrees that, during the period of duration not to exceed 180 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of the first registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, and, for a period of duration not to exceed 90 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of any subsequent registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, it shall not, to the extent requested by the Company and such underwriter, directly or indirectly, sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound), or reduce its interest in (collectively, “Transfer”), any Shares issuable upon exercise of this Warrant during such period except Common Stock included in such registration. Such restrictions, however, shall not be applicable to transfers to any affiliated entity of Warrantholder, including any affiliated corporation, partnership, limited partnership, limited liability company or investment fund, or to any stockholders, partners, general partners, limited partners and members of Warrantholder, in each case who agree in writing to be bound by this Warrant, including this Section. To enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Company’s securities held by Warrantholder (and the shares or securities of every other person or entity subject to the foregoing restriction) until the end of such period.

(j) Descriptive Headings. The descriptive headings of the several paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant.

(k) Governing Law. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF THE STATE WHERE THE COMPANY IS INCORPORATED.

SIGNATURE PAGE FOLLOWS:

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In Witness Whereof, this Warrant to purchase Preferred Stock has been duly executed as of the Grant Date hereinabove set forth.

Issued By:		Accepted By:
Danger, Inc.		Heller Financial Leasing, Inc.
By:	/s/ Henry R. Nothhaft	By:
Title:	CEO	Title:
Address for Notices:		Address for Notices:
3101 Park Blvd. Palo Alto, CA 94306		500 West Monroe Chicago, IL 60661
Attention: Legal Department		Attention: Portfolio Management, GE Capital Technology Finance
Fax: 650-289-5001
With a copy to:		Fax: 312-876-2593
O’Melvany & Meyers
Attention: David Makarechian
2765 Sand Hill Road Menlo Park, CA 94025-7019
Tel: (650) 473-2600
Fax: (650) 473-2601

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EXHIBIT A

Notice of Exercise

To: Danger, Inc. (“Company”)

3101 Park Blvd., Palo Alto, CA 94306

Attention: Chief Financial Officer

[1. The undersigned hereby elects to purchase                                          shares of Series D Convertible Preferred Stock of Company pursuant to the terms of the attached Warrants, and tenders herewith payment of the purchase price of such shares in full.]

[1. The undersigned hereby elects to purchase                                          shares of Series D Convertible Preferred Stock of Company pursuant to a non-cash exercise of the Warrant as provided in Section 2.2 of the Warrant.]

2. Check here if applicable:      The undersigned confirms that this exercise is made in connection with the occurrence of a public offering, sale or merger of the Company, and the undersigned further elects to condition this exercise of the Warrant upon the consummation of said public offering, sale or merger of the Company. This exercise shall not be deemed to be effective until the consummation of such transaction. In the event that transaction is not consummated within 45 days of the targeted date of the transaction, the undersigned will advise Company whether or not this exercise should be deemed rescinded.

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

Heller Financial Leasing, Inc.

500 West Monroe

Chicago, IL 60661

3. The undersigned represents that the aforesaid shares are being acquired for the account of the undersigned for investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing such shares.

Heller Financial Leasing, Inc.
By:
	(Signature)
Its:
Date:

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EX-4.8

Exhibit 4.8

THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT.

Warrant No.             

DANGER, INC.

WARRANT TO PURCHASE SHARES OF SERIES D’ PREFERRED STOCK

This Warrant is issued to                                          (“Holder”) by Danger, Inc., a Delaware corporation (the “Company”), as of February     , 2004.

1. Purchase of Shares. Subject to the terms and conditions hereinafter set forth herein, Holder is entitled, upon surrender of this Warrant at the principal office of the Company (or at such other place as the Company shall notify Holder in writing), to purchase from the Company up to                                          (            ) shares (the “Shares”) of Series D’ Preferred Stock of the Company (the “Series D’ Preferred Stock”) at an exercise price of $0.9007 per share (the “Exercise Price”). The Shares and the Exercise Price shall be subject to adjustment as set forth in Section 8 hereof.

2. Exercise Period. This Warrant shall be exercisable for a period (the “Exercise Period”) of seven (7) years from the date hereof; provided, however, that in the event of the earlier closing of (a) the issuance and sale of shares of the Company’s Common Stock (the “Common Stock”) in the Company’s first underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Act”), at a per share price to the public that values the Company at not less than $373 million and in which the aggregate proceeds to the Company (before deduction of underwriters’ discounts and expenses relating to the issuance, including, without limitation, fees of the Company’s counsel) are at least $35,000,000, (b) a sale of all or substantially all the assets of the Company where the consideration is cash or readily marketable securities, or (c) a merger or reorganization of the Company into or consolidation with any other entity (excluding a reorganization or merger, the sole purpose of which is to change the jurisdiction of incorporation of the Company) where the consideration is cash or readily marketable securities, this Warrant shall, on the date of such event, no longer be exercisable and become null and void. In the event of a proposed transaction of the kind described above or the termination of the Exercise Period, the Company shall notify Holder in writing at least fifteen (15) days prior to, and this Warrant shall be deemed exercised pursuant to Section 5 immediately prior to, the consummation of such event, transaction or termination of the Exercise Period.

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3. Method of Exercise. While this Warrant remains outstanding and exercisable during the Exercise Period, Holder may exercise, in whole or in part, the purchase rights evidenced hereby. Such exercise shall be effected by: (i) the surrender of the Warrant, together with a duly executed copy of the form of Exercise Notice attached hereto, to the Chief Executive Officer of the Company at its principal offices; and (ii) the payment to the Company by cash, check or wire transfer of an amount equal to the aggregate Exercise Price for the number of Shares being purchased.

4. Effective Time of Exercise. Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 3 above. At such time, the person or persons in whose name or names any certificates for Series D’ Preferred Stock shall be issuable upon such exercise as provided in Section 6 below shall be deemed to have become the holder or holders of record of the Series D’ Preferred Stock represented by such certificates.

5. Net Issuance Provision. In lieu of exercising pursuant to paragraph 3 above, at the Holder’s option, while this Warrant remains outstanding and exercisable during the Exercise Period, Holder may exercise this Warrant by surrender of this Warrant as determined below (“Net Issuance”). If the Holder elects the Net Issuance method, the Company will issue Series D’ Preferred Stock in accordance with the following formula:

X =	Y(A-B)
	A
Where:
X =	the number of shares of Series D’ Preferred Stock to be issued to the Holder.
Y =	the number of shares of Series D’ Preferred Stock requested to be exercised under this Warrant Agreement.
A =	the fair market value of one (1) share of Series D’ Preferred Stock.
B =	the Exercise Price (as adjusted on the date of calculation).

For purposes of the above calculation, current fair market value of Series D’ Preferred Stock shall mean with respect to each share of Series D’ Preferred Stock:

(a) the product of (i) the average daily Market Price (as defined below) during the period of the most recent ten (10) days, ending on the last business day before the effective date of exercise, on which the national securities exchanges were open for trading and (ii) the number of shares of the Common Stock (as defined herein) into which each share of Series D’ Preferred Stock is convertible on such date; or

(b) if no class of Common Stock is then listed or admitted to trading on any national securities exchange or quoted in the over-counter market, the fair market

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value shall be the Market Price (as defined in Section 5(c) hereof) on the last business day before the effective date of exercise.

(c) If the Common Stock is traded on a national securities exchange or admitted to unlisted trading privileges on such an exchange, or is listed on the National Market System (the “National Market System”) of the Nasdaq, the Market Price as of a specified day shall be the last reported sale price of Common Stock on such exchange or on the National Market System on such date or if no such sale is made on such day, the mean of the closing bid and asked prices for such day on such exchange or on the National Market System. If the Common Stock is not so listed or admitted to unlisted trading privileges, the Market Price as of a specified day shall be the mean of the last bid and asked prices reported on such date (x) by the Nasdaq or (y) if reports are unavailable under clause (x) above by the National Quotation Bureau Incorporated. If the Common Stock is not so listed or admitted to unlisted trading privileges and bid and ask prices are not reported, the Market Price as of a specified day shall be determined in good faith by the Board of Directors of the Company.

Upon partial exercise by either cash or Net Issuance, the Company shall promptly issue an amended Warrant representing the remaining number of shares purchasable thereunder. All other terms and conditions of such amended Warrant shall be identical to those contained herein, including, but not limited to, the Exercise Period.

6. Certificates for Shares. Upon the exercise of the purchase rights evidenced by this Warrant, one or more certificates for the number of Shares so purchased shall be issued as soon as practicable thereafter. Upon any partial exercise of this Warrant, the Company will forthwith issue and deliver to Holder a new warrant or warrants of like tenor as this Warrant for the remaining portion of the Series D’ Preferred Stock for which this Warrant may still be exercised. The Company shall pay all expenses, and any and all stamp or similar taxes (but excluding transfer taxes) that may be payable in connection with the preparation, issuance and delivery of stock certificates and any new warrant certificate under this Section 6.

7. Issuance of Shares. The Company covenants that (a) the Shares, when issued pursuant to the exercise of this Warrant, will be duly and validly issued, fully-paid and non-assessable and free from all taxes, liens and charges with respect to the issuance thereof (except for any applicable transfer taxes, which shall be paid by Holder) and (b) during the Exercise Period, the Company will reserve from its authorized and unissued Series D’ Preferred Stock a sufficient number of shares to provide for the issuance of Series D’ Preferred Stock upon the exercise of this Warrant.

8. Adjustment of Exercise Price and Number of Shares. The number of and kind of securities purchasable upon exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:

(a) Subdivisions, Combinations and Other Issuances. If the Company shall at any time prior to the expiration of this Warrant subdivide its Series D’ Preferred Stock, by split or otherwise, or combine its Series D’ Preferred Stock, or issue additional shares of its Series D’ Preferred Stock as a dividend with respect to any shares of its

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Series D’ Preferred Stock, the number of Shares issuable on the exercise of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination. Appropriate adjustments shall also be made to the purchase price payable per share, but the aggregate purchase price payable for the total number of Shares purchasable under this Warrant (as adjusted) shall remain the same. Any adjustment under this Section 8(a) shall become effective as of the record date of such subdivision, combination or dividend, or in the event that no record date is fixed, upon the making of such subdivision, combination or dividend. It being understood that the Series D’ Preferred Stock issuable upon exercise of the Warrant shall be subject to the provisions set forth in the Amended and Restated Certificate of Incorporation as in effect as of the date hereof (the “Restated Certificate”) which relate to the adjustment of the Conversion Price, as that term is defined in the Restated Certificate.

(b) Reclassification, Reorganization and Consolidation. In case of any reclassification, capital reorganization, or change in the Series D’ Preferred Stock of the Company (other than as a result of a subdivision, combination, or stock dividend provided for in Section 8(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to Holder, so that Holder shall have the right at any time prior to the expiration of this Warrant to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Series D’ Preferred Stock as were purchasable by Holder immediately prior to such reclassification, reorganization or change. In any such case, appropriate provisions shall be made with respect to the rights and interest of Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same.

(c) Conversion. If all of the Company’s outstanding Preferred Stock is redeemed or converted into shares of Common Stock, then this Warrant shall automatically become exercisable for that number of shares of Common Stock that would have been received if this Warrant had been exercised in full and the shares of Series D’ Preferred Stock received thereupon had been simultaneously converted into shares of Common Stock, in each case immediately prior to such redemption or conversion. Appropriate provisions shall be made with respect to the rights and interests of Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of Common Stock deliverable upon exercise hereof, and appropriate adjustments shall also be made to the purchase price payable per share, but the aggregate purchase price payable for the total number of shares of Common Stock purchasable under this Warrant (as adjusted) shall remain the same.

(d) Certificate of Adjustment. When any adjustment is required to be made in the number or kind of shares purchasable upon exercise of the Warrant or in the

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Exercise Price, an officer of the Company shall promptly compute such adjustment in accordance with the terms of this Warrant and prepare a certificate setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated and the Exercise Price and number of shares purchasable hereunder after giving effect to such adjustment, and shall cause a copy of such certificate to be mailed (by first class mail, postage prepaid) to Holder.

9. Compliance with Securities Laws. Holder hereby represents and warrants that:

(a) Purchase Entirely for Own Account. This Warrant and the Series D’ Preferred Stock issuable upon exercise hereof (collectively, the “Securities”) will be acquired for investment for Holder’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and Holder has no present intention of selling, granting any participation in or otherwise distributing the same. Holder does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participation to any person with respect to any of the Securities. Holder represents that it has full power and authority to enter into this Warrant.

(b) Investment Experience. Holder acknowledges that it is able to fend for itself, can bear the economic risk of its investment and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in this Warrant. Holder also represents it has not been organized for the purpose of acquiring this Warrant.

(c) Accredited Investor. Holder is an “accredited investor” within the meaning of Rule 501 of Regulation D of the Securities and Exchange Commission (the “SEC”), as presently in effect.

(d) Restricted Securities. Holder understands that the Securities are characterized as “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering, and that under such laws and applicable regulations such securities may be resold without registration under the Act only in certain limited circumstances. In this connection, Holder represents that it is familiar with SEC Rule 144 promulgated under the Act, as presently in effect, and understands the resale limitations imposed thereby and by the Act.

10. Further Limitations on Disposition. Without in any way limiting the representations set forth above, Holder further agrees not to make any disposition of all or any portion of the Securities unless and until there is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with such registration statement, or (i) Holder shall have notified the Company of the proposed disposition and shall have furnished the Company with a detailed statement of the circumstances surrounding the proposed disposition, and (ii) if reasonably requested by the Company, Holder

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shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that such disposition will not require registration of such shares under the Act.

11. No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant, but in lieu of such fractional shares the Company shall make a cash payment therefor on the basis of the fair market value of the Company’s Series D’ Preferred Stock as determined pursuant to Section 5 above.

12. No Stockholder Rights. Prior to exercise of this Warrant, Holder shall not be entitled to any rights of a stockholder with respect to the Shares, including (without limitation) the right to vote such Shares, receive dividends or other distributions thereon, exercise preemptive rights or be notified of stockholder meetings, and Holder, as such, shall not be entitled to any notice or other communication concerning the business or affairs of the Company, except as set forth in Section 2 above.

13. Replacement of Warrant. 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 substance 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 and amount.

14. Notices. All notices or other communications hereunder shall be in writing and shall be deemed given when (i) personally delivered, (ii) three days after being sent by prepaid certified or registered U.S. mail, or one day after being sent, if sent by nationally recognized overnight courier, to the address of the party to be noticed as set forth herein or such other address as such party last provided to the other by written notice, or (iii) upon receipt of electronic confirmation, if by facsimile. All notices shall be sent to the addresses and facsimile numbers set forth below or such other address as may be given from time to time under the terms of this notice provision:

If to the Company:

Danger, Inc.

3101 Park Blvd.

Palo Alto, CA 94306

Attention: Chief Executive Officer

If to Holder:

At the address and facsimile number

previously indicated to the Company.

15. Successors and Assigns. Except as otherwise provided herein, the terms and conditions of this Warrant shall inure to the benefit of and be binding upon the successors and assigns of the parties (including transferees of any Shares). Nothing in this Warrant, express or implied, is intended to confer upon any party, other than the parties hereto or their respective successors and assigns, any rights, remedies, obligations or liabilities under or by reason of this

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Warrant, except as expressly provided herein. The Warrant and Shares shall not be transferable by Holder except to an affiliate of such Holder, including, without limitation, any affiliated corporation, partnership, limited partnership, limited liability company, or an investment fund, or to any stockholders, partners, general partners, limited partners and members of such Holder, provided that such affiliate, stockholder, partner, general partner, limited partner or member agrees in writing to be subject to the obligations and conditions set forth herein.

16. Amendments and Waivers. Any term of this Warrant may be amended and the observance of any term of this Warrant may be waived (either generally or in a particular instance and either retroactively or prospectively), with the written consent of each of the parties hereto. Any waiver or amendment effected in accordance with this section shall be binding upon Holder and the Company.

17. Governing Law. This Warrant shall be governed by the laws of the State of California as applied to agreements among California residents made and to be performed entirely within the State of California. Each of the parties irrevocably and unconditionally waives, to the fullest extent permitted by law, any and all rights to a trial by jury in connection with any litigation arising out of or relating to this Warrant or the transaction contemplated hereby.

18. Market Stand-off Provision. Holder hereby agrees that, during the period of duration not to exceed 180 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of the first registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, and, for a period of duration not to exceed 90 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of any subsequent registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, it shall not, to the extent requested by the Company and such underwriter, directly or indirectly, sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound), or reduce its interest in (collectively, “Transfer”), any Shares issuable upon exercise of this Warrant during such period except Common Stock included in such registration; provided, however, that all executive officers, directors and stockholders that hold one percent (1%) or more of the Common Stock (including on an as-converted basis any shares of Common Stock issuable upon the conversion or exercise of any share of the Company’s Preferred Stock, warrant, right or other security) of the Company enter into similar agreements. Such restrictions, however, shall not be applicable to transfers to any affiliated entity of Holder, including any affiliated corporation, partnership, limited partnership, limited liability company or investment fund, or to any stockholders, partners, general partners, limited partners and members of Holder, in each case who agree in writing to be bound by this Warrant, including this Section 18.

To enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Company’s securities held by Holder (and the shares or securities of every other person or entity subject to the foregoing restriction) until the end of such period.

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19. Entire Agreement. This Warrant and the other documents delivered pursuant hereto or referred to herein, constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof.

20. Severability. In case any provision of this Warrant shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

21. Counterparts. This Warrant may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

22. Survival. Except as expressly set forth herein, the representations, warranties, covenants and agreements made herein shall survive the closing of the transactions contemplated hereby.

23. Confidentiality. Holder agrees that, except with the prior written consent of the Company, Holder shall at all times keep confidential and not divulge, furnish or make accessible to anyone any confidential information, knowledge or data concerning or relating to the business or financial affairs of the Company to which Holder has been or shall become privy. The provisions of this Section 23 shall be in addition to, and not in substitution for, the provisions of any separate nondisclosure agreement executed by the parties hereto.

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IN WITNESS WHEREOF, this Warrant is executed as of the date first referenced above.

COMPANY:
DANGER, INC.
By:
	Henry R. Nothhaft,
	Chairman and Chief Executive Officer

[Signature Page to Warrant]

EXERCISE NOTICE

Danger, Inc.

Attention: Chief Executive Officer

1. The undersigned hereby elects to purchase, pursuant to the provisions of the Warrant to Purchase Shares of Series D’ Preferred Stock issued by Danger, Inc. and held by the undersigned, the original of which is attached hereto,                                          shares of Series D’ Preferred Stock of Danger, Inc. Payment of the exercise price per share required under such Warrant accompanies this Exercise Notice.

2. The undersigned hereby represents and warrants that the undersigned is acquiring such shares for its own account for investment purposes only, and not for resale or with a view to distribution of such shares or any part thereof.

HOLDER:

Name:

Title:

Date:

Address:

Name in which shares should be registered:

Exercise Notice

EX-4.10

Exhibit 4.10

THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT.

Warrant No. WPE-1

DANGER, INC.

WARRANT TO PURCHASE SHARES OF SERIES E PREFERRED STOCK

This Warrant is issued to ATEL VENTURES, INC., in its capacity as Trustee for its assignee affiliated funds identified in that certain Amendment and Restatement of Inter-Company Trust Agreement for Warrants dated as of February 1, 2006 and deemed effective as of July 20, 2004 (“Holder”) by Danger, Inc., a Delaware corporation (the “Company”), as of October 16, 2006.

1. Purchase of Shares. Subject to the terms and conditions hereinafter set forth herein, Holder is entitled, upon surrender of this Warrant at the principal office of the Company (or at such other place as the Company shall notify Holder in writing), to purchase from the Company up to One Hundred Twenty-Eight Thousand Seven Hundred (128,700) shares (the “Shares”) of Series E Preferred Stock of the Company (the “Series E Preferred Stock”) at an exercise price of $1.1655 per share (the “Exercise Price”). The Shares and the Exercise Price shall be subject to adjustment as set forth in Section 9 hereof.

2. Exercise Period. This Warrant shall be exercisable for a period (the “Exercise Period”) of seven (7) years from the date hereof; provided, however, that in the event of the earlier closing of (a) the issuance and sale of shares of the Company’s Common Stock (the “Common Stock”) in the Company’s first underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Act”), at a per share price to the public that values the Company at not less than $373 million and in which the aggregate proceeds to the Company (before deduction of underwriters’ discounts and expenses relating to the issuance, including, without limitation, fees of the Company’s counsel) are at least $35,000,000, (b) a sale of all or substantially all the assets of the Company where the consideration is cash or readily marketable securities, or (c) a merger or reorganization of the Company into or consolidation with any other entity (excluding a reorganization or merger, the sole purpose of which is to change the jurisdiction of incorporation of the Company) where the consideration is cash or readily marketable securities (the transactions described in clauses (b) and (c), each an “Acquisition”), this Warrant shall, on the date of such event, no longer be exercisable and become null and void. In the event of a proposed transaction of the kind described above or the termination of the Exercise Period, the Company shall notify Holder in

writing at least fifteen (15) days prior to, and this Warrant shall be deemed exercised pursuant to Section 6 immediately prior to, the consummation of such event, transaction or termination of the Exercise Period.

3. Company’s Agreement Upon Acquisition. Notwithstanding the provisions in Section 2, if the consideration payable in an Acquisition is readily marketable securities, and the per share value of such marketable securities is not greater than two (2) times the Exercise Price, this Warrant shall survive such Acquisition until otherwise terminated pursuant to Section 2 following such Acquisition.

4. Method of Exercise. While this Warrant remains outstanding and exercisable during the Exercise Period, Holder may exercise, in whole or in part, the purchase rights evidenced hereby. Such exercise shall be effected by: (i) the surrender of the Warrant, together with a duly executed copy of the form of Exercise Notice attached hereto, to the Chief Executive Officer of the Company at its principal offices; and (ii) the payment to the Company by cash, check or wire transfer of an amount equal to the aggregate Exercise Price for the number of Shares being purchased.

5. Effective Time of Exercise. Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 4 above. At such time, the person or persons in whose name or names any certificates for Series E Preferred Stock shall be issuable upon such exercise as provided in Section 6 below shall be deemed to have become the holder or holders of record of the Series E Preferred Stock represented by such certificates.

6. Net Issuance Provision. In lieu of exercising pursuant to paragraph 3 above, at the Holder’s option, while this Warrant remains outstanding and exercisable during the Exercise Period, Holder may exercise this Warrant by surrender of this Warrant as determined below (“Net Issuance”). If the Holder elects the Net Issuance method, the Company will issue Series E Preferred Stock in accordance with the following formula:

X = Y(A-B)

            A

Where:

X = the number of shares of Series E Preferred Stock to be issued to the Holder.

Y = the number of shares of Series E Preferred Stock requested to be exercised under this Warrant Agreement.

A = the fair market value of one (1) share of Series E Preferred Stock.

B = the Exercise Price (as adjusted on the date of calculation).

For purposes of the above calculation, current fair market value of Series E Preferred Stock shall mean with respect to each share of Series E Preferred Stock:

(a) the product of (i) the average daily Market Price (as defined below) during the period of the most recent ten (10) days, ending on the last business day before the effective date of exercise, on which the national securities exchanges were open for trading and (ii) the number of shares of the Common Stock (as defined herein) into which each share of Series E Preferred Stock is convertible on such date; or

(b) if no class of Common Stock is then listed or admitted to trading on any national securities exchange or quoted in the over-counter market, the fair market value shall be the Market Price (as defined in Section 6(c) hereof) on the last business day before the effective date of exercise.

(c) If the Common Stock is traded on a national securities exchange or admitted to unlisted trading privileges on such an exchange, or is listed on the National Market System (the “National Market System”) of the Nasdaq, the Market Price as of a specified day shall be the last reported sale price of Common Stock on such exchange or on the National Market System on such date or if no such sale is made on such day, the mean of the closing bid and asked prices for such day on such exchange or on the National Market System. If the Common Stock is not so listed or admitted to unlisted trading privileges, the Market Price as of a specified day shall be the mean of the last bid and asked prices reported on such date (x) by the Nasdaq or (y) if reports are unavailable under clause (x) above by the National Quotation Bureau Incorporated. If the Common Stock is not so listed or admitted to unlisted trading privileges and bid and ask prices are not reported, the Market Price as of a specified day shall be determined in good faith by the Board of Directors of the Company.

Upon partial exercise by either cash or Net Issuance, the Company shall promptly issue an amended Warrant representing the remaining number of shares purchasable thereunder. All other terms and conditions of such amended Warrant shall be identical to those contained herein, including, but not limited to, the Exercise Period.

7. Certificates for Shares. Upon the exercise of the purchase rights evidenced by this Warrant, one or more certificates for the number of Shares so purchased shall be issued as soon as practicable thereafter. Upon any partial exercise of this Warrant, the Company will forthwith issue and deliver to Holder a new warrant or warrants of like tenor as this Warrant for the remaining portion of the Series E Preferred Stock for which this Warrant may still be exercised. The Company shall pay all expenses, and any and all stamp or similar taxes (but excluding transfer taxes) that may be payable in connection with the preparation, issuance and delivery of stock certificates and any new warrant certificate under this Section 7.

8. Issuance of Shares. The Company covenants that (a) the Shares, when issued pursuant to the exercise of this Warrant, will be duly and validly issued, fully-paid and non-assessable and free from all taxes, liens and charges with respect to the issuance thereof (except for any applicable transfer taxes, which shall be paid by Holder) and (b) during the Exercise Period, the Company will reserve from its authorized and unissued Series E Preferred

Stock a sufficient number of shares to provide for the issuance of Series E Preferred Stock upon the exercise of this Warrant.

9. Adjustment of Exercise Price and Number of Shares. The number of and kind of securities purchasable upon exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:

(a) Subdivisions, Combinations and Other Issuances. If the Company shall at any time prior to the expiration of this Warrant subdivide its Series E Preferred Stock, by split or otherwise, or combine its Series E Preferred Stock, or issue additional shares of its Series E Preferred Stock as a dividend with respect to any shares of its Series E Preferred Stock, the number of Shares issuable on the exercise of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination. Appropriate adjustments shall also be made to the purchase price payable per share, but the aggregate purchase price payable for the total number of Shares purchasable under this Warrant (as adjusted) shall remain the same. Any adjustment under this Section 9(a) shall become effective as of the record date of such subdivision, combination or dividend, or in the event that no record date is fixed, upon the making of such subdivision, combination or dividend. It being understood that the Series E Preferred Stock issuable upon exercise of the Warrant shall be subject to the provisions set forth in the Amended and Restated Certificate of Incorporation as in effect as of the date hereof (the “Restated Certificate”) which relate to the adjustment of the Conversion Price, as that term is defined in the Restated Certificate.

(b) Reclassification, Reorganization and Consolidation. In case of any reclassification, capital reorganization, or change in the Series E Preferred Stock of the Company (other than as a result of a subdivision, combination, or stock dividend provided for in Section 9(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to Holder, so that Holder shall have the right at any time prior to the expiration of this Warrant to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Series E Preferred Stock as were purchasable by Holder immediately prior to such reclassification, reorganization or change. In any such case, appropriate provisions shall be made with respect to the rights and interest of Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same.

(c) Conversion. If all of the Company’s outstanding Preferred Stock is redeemed or converted into shares of Common Stock, then this Warrant shall automatically become exercisable for that number of shares of Common Stock that would have been received if this Warrant had been exercised in full and the shares of Series E

Preferred Stock received thereupon had been simultaneously converted into shares of Common Stock, in each case immediately prior to such redemption or conversion. Appropriate provisions shall be made with respect to the rights and interests of Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of Common Stock deliverable upon exercise hereof, and appropriate adjustments shall also be made to the purchase price payable per share, but the aggregate purchase price payable for the total number of shares of Common Stock purchasable under this Warrant (as adjusted) shall remain the same.

(d) Certificate of Adjustment. When any adjustment is required to be made in the number or kind of shares purchasable upon exercise of the Warrant or in the Exercise Price, an officer of the Company shall promptly compute such adjustment in accordance with the terms of this Warrant and prepare a certificate setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated and the Exercise Price and number of shares purchasable hereunder after giving effect to such adjustment, and shall cause a copy of such certificate to be mailed (by first class mail, postage prepaid) to Holder.

10. Compliance with Securities Laws. Holder hereby represents and warrants that:

(a) Purchase Entirely for Own Account. This Warrant and the Series E Preferred Stock issuable upon exercise hereof (collectively, the “Securities”) will be acquired for investment for Holder’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and Holder has no present intention of selling, granting any participation in or otherwise distributing the same. Holder does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participation to any person with respect to any of the Securities. Holder represents that it has full power and authority to enter into this Warrant.

(b) Investment Experience. Holder acknowledges that it is able to fend for itself, can bear the economic risk of its investment and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in this Warrant. Holder also represents it has not been organized for the purpose of acquiring this Warrant.

(c) Accredited Investor. Holder is an “accredited investor” within the meaning of Rule 501 of Regulation D of the Securities and Exchange Commission (the “SEC”), as presently in effect.

(d) Restricted Securities. Holder understands that the Securities are characterized as “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering, and that under such laws and applicable regulations such securities may be resold without registration under the Act only in certain limited circumstances. In this connection, Holder represents that it is familiar with SEC Rule 144 promulgated under the Act, as

presently in effect, and understands the resale limitations imposed thereby and by the Act.

11. Further Limitations on Disposition. Without in any way limiting the representations set forth above, Holder further agrees not to make any disposition of all or any portion of the Securities unless and until there is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with such registration statement, or (i) Holder shall have notified the Company of the proposed disposition and shall have furnished the Company with a detailed statement of the circumstances surrounding the proposed disposition, and (ii) if reasonably requested by the Company, Holder shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that such disposition will not require registration of such shares under the Act.

12. No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant, but in lieu of such fractional shares the Company shall make a cash payment therefor on the basis of the fair market value of the Company’s Series E Preferred Stock as determined pursuant to Section 6 above.

13. No Stockholder Rights. Prior to exercise of this Warrant, Holder shall not be entitled to any rights of a stockholder with respect to the Shares, including (without limitation) the right to vote such Shares, receive dividends or other distributions thereon, exercise preemptive rights or be notified of stockholder meetings, and Holder, as such, shall not be entitled to any notice or other communication concerning the business or affairs of the Company, except as set forth in Section 2 above.

14. Information Rights. Commencing as of the date that the Master Lease, dated as of the date hereof, between Holder and Company (the “Master Lease”) terminates or expires, and for so long as the Holder holds this Warrant and/or any of the Shares, the Company shall deliver to the Holder (a) promptly after mailing, copies of all notices or other written communications to the shareholders of the Company, (b) within one-hundred and twenty (120) days after the end of each fiscal year of the Company, the annual audited financial statements of the Company certified by independent public accountants of recognized standing and (c) within forty-five (45) days after the end of each of the first three quarters of each fiscal year, the Company’s quarterly, unaudited financial statements.

15. Replacement of Warrant. 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 substance 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 and amount.

16. 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 exercise hereof) 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 6 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.

17. Notices. All notices or other communications hereunder shall be in writing and shall be deemed given when (i) personally delivered, (ii) three days after being sent by prepaid certified or registered U.S. mail, or one day after being sent, if sent by nationally recognized overnight courier, to the address of the party to be noticed as set forth herein or such other address as such party last provided to the other by written notice, or (iii) upon receipt of electronic confirmation, if by facsimile. All notices shall be sent to the addresses and facsimile numbers set forth below or such other address as may be given from time to time under the terms of this notice provision:

If to the Company:

Danger, Inc.

3101 Park Blvd.

Palo Alto, CA 94306

Attention: Chief Executive Officer

If to Holder:

At the address and facsimile number

previously indicated to the Company.

18. Successors and Assigns. Except as otherwise provided herein, the terms and conditions of this Warrant shall inure to the benefit of and be binding upon the successors and assigns of the parties (including transferees of any Shares). Nothing in this Warrant, express or implied, is intended to confer upon any party, other than the parties hereto or their respective successors and assigns, any rights, remedies, obligations or liabilities under or by reason of this Warrant, except as expressly provided herein. The Warrant and Shares shall not be transferable by Holder except to an affiliate of such Holder, including, without limitation, any affiliated corporation, partnership, limited partnership, limited liability company, or an investment fund, or to any stockholders, partners, general partners, limited partners and members of such Holder, provided that such affiliate, stockholder, partner, general partner, limited partner or member agrees in writing to be subject to the obligations and conditions set forth herein.

19. Amendments and Waivers. Any term of this Warrant may be amended and the observance of any term of this Warrant may be waived (either generally or in a particular instance and either retroactively or prospectively), with the written consent of each of the parties hereto. Any waiver or amendment effected in accordance with this section shall be binding upon Holder and the Company.

20. Governing Law. This Warrant shall be governed by the laws of the State of California as applied to agreements among California residents made and to be performed entirely within the State of California. Each of the parties irrevocably and unconditionally waives, to the fullest extent permitted by law, any and all rights to a trial by jury in connection

with any litigation arising out of or relating to this Warrant or the transaction contemplated hereby.

21. Market Stand-off Provision. Holder hereby agrees that, during the period of duration not to exceed 180 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of the first registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, and, for a period of duration not to exceed 90 days specified by the Company and an underwriter of Common Stock or other securities of the Company, following the effective date of any subsequent registration statement for a firm commitment underwritten public offering of the Company’s securities filed under the Act, it shall not, to the extent requested by the Company and such underwriter, directly or indirectly, sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound), or reduce its interest in (collectively, “Transfer”), any Shares issuable upon exercise of this Warrant during such period except Common Stock included in such registration; provided, however, that all executive officers, directors and stockholders that hold one percent (1%) or more of the Common Stock (including on an as-converted basis any shares of Common Stock issuable upon the conversion or exercise of any share of the Company’s Preferred Stock, warrant, right or other security) of the Company enter into similar agreements. Such restrictions, however, shall not be applicable to transfers to any affiliated entity of Holder, including any affiliated corporation, partnership, limited partnership, limited liability company or investment fund, or to any stockholders, partners, general partners, limited partners and members of Holder, in each case who agree in writing to be bound by this Warrant, including this Section 21.

To enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Company’s securities held by Holder (and the shares or securities of every other person or entity subject to the foregoing restriction) until the end of such period.

22. Registration Rights Agreement. The Holder shall be entitled, with respect to the Shares issuable upon exercise of this Warrant or the shares of Common Stock issuable upon conversion of the Series E Preferred Stock, to all of the “piggyback registration” rights set forth in Section 2.3 of that certain Amended and Restated Investors’ Rights Agreement dated September 29, 2006 (as the same may be amended from time to time, the “IRA”) in effect as of the date hereof among the Company and the parties thereto including the investors listed on any one or more Schedules thereto, on the terms and conditions set forth therein, as if such terms and conditions were set forth in this Warrant. A copy of said IRA has been provided to the Holder. Simultaneously with the execution of this Warrant, the Holder shall execute, at the option of the Company, either a counterpart signature page to such IRA, or an amendment to the IRA, either of which document shall add the Holder as a party thereto and give the Holder such piggyback registration rights to the extent provided therein. Company shall use its best efforts to obtain the consent of holders of at least  ²/3 of the Registrable Securities, as defined in the IRA, then outstanding to Holder being made a party to the IRA with pari passu piggyback registration rights unless Holder has otherwise become a party to the IRA. Company and the Holder hereby further agree that for the purposes of the IRA, the Shares issuable upon exercise of this Warrant are “Registrable Securities,” as that term is defined in the IRA.

23. Entire Agreement. This Warrant and the other documents delivered pursuant hereto or referred to herein, constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof.

24. Severability. In case any provision of this Warrant shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

25. Counterparts. This Warrant may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

26. Survival. Except as expressly set forth herein, the representations, warranties, covenants and agreements made herein shall survive the closing of the transactions contemplated hereby.

27. Confidentiality. Holder agrees that, except with the prior written consent of the Company, Holder shall at all times keep confidential and not divulge, furnish or make accessible to anyone any confidential information, knowledge or data concerning or relating to the business or financial affairs of the Company to which Holder has been or shall become privy. The provisions of this Section 27 shall be in addition to, and not in substitution for, the provisions of any separate nondisclosure agreement executed by the parties hereto.

IN WITNESS WHEREOF, this Warrant is executed as of the date first referenced above.

COMPANY:
DANGER, INC.
By:	/s/ Henry R. Nothhaft
	Henry R. Nothhaft,
	Chairman and Chief Executive Officer

EXERCISE NOTICE

Danger, Inc.

Attention: Chief Executive Officer

1. The undersigned hereby elects to purchase, pursuant to the provisions of the Warrant to Purchase Shares of Series E Preferred Stock issued by Danger, Inc. and held by the undersigned, the original of which is attached hereto,                                                   shares of Series E Preferred Stock of Danger, Inc. Payment of the exercise price per share required under such Warrant accompanies this Exercise Notice.

2. The undersigned hereby represents and warrants that the undersigned is acquiring such shares for its own account for investment purposes only, and not for resale or with a view to distribution of such shares or any part thereof.

HOLDER:

Name:

Title:

Date:

Address:

Name in which shares should be registered:

Exercise Notice

EX-4.11

Exhibit 4.11

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 BELOW, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.

WARRANT TO PURCHASE STOCK

Company:	Danger, Inc., a Delaware corporation
Number of Shares:	326,040
Class of Stock:	Series E Preferred
Warrant Price:	$1.1655 per share
Issue Date:	October 12, 2007
Expiration Date:	The 7th anniversary after the Issue Date, subject to the terms of Section 1.6.2 below
Credit Facility:	This Warrant is issued in connection with the Loan and Security Agreement between Company and Silicon Valley Bank dated of even date herewith.

THIS WARRANT CERTIFIES THAT, for good and valuable consideration, SILICON VALLEY BANK (Silicon Valley Bank, together with any registered holder from time to time of this Warrant or any holder of the shares issuable or issued upon exercise of this Warrant, “Holder”) is entitled to purchase the number of fully paid and nonassessable shares of the class of securities (the “Shares”) of the Company at the Warrant Price, all as set forth above and as adjusted pursuant to Article 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant.

ARTICLE 1. EXERCISE.

1.1 Method of Exercise. Holder may exercise this Warrant by delivering a duly executed (i) Notice of Exercise in substantially the form attached as Appendix 1 and (ii) IRA Signature Page (as defined in Section 3.3 below) to the principal office of the Company to the principal office of the Company. Unless Holder is exercising the conversion right set forth in Section 1.2, Holder shall also deliver to the Company a check, wire transfer (to an account designated by the Company), or other form of payment acceptable to the Company for the aggregate Warrant 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 by dividing (a) the aggregate fair market value of the Shares or other securities otherwise issuable upon exercise of this Warrant, or if exercised in part, the portion of the total number of Shares or other securities being converted upon exercise of this Warrant, minus the aggregate Warrant Price of such

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Shares by (b) the fair market value of one Share. The fair market value of the Shares shall be determined pursuant to Section 1.3.

1.3 Fair Market Value. If the Company’s common stock is traded in a public market and the Shares are common stock, the fair market value of each Share shall be the closing price of a Share reported for the business day immediately before Holder delivers its Notice of Exercise to the Company (or in the instance where the Warrant is exercised immediately prior to or upon the closing of the initial public offering of the Company’s common stock registered under the Securities Act of 1933, as amended (an “IPO”), the initial “price to public” per share price specified in the final prospectus relating to such offering). If the Company’s common stock is traded in a public market and the Shares are preferred stock, the fair market value of a Share shall be the closing price of a share of the Company’s common stock reported for the business day immediately before Holder delivers its Notice of Exercise to the Company (or, in the instance where the Warrant is exercised immediately prior to or upon the closing of an IPO, the initial “price to public” per share price specified in the final prospectus relating to such offering) multiplied by the number of shares of the Company’s common stock into which a Share is then convertible. If the Company’s common stock is not traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment.

1.4 Delivery of Certificate and New Warrant. Promptly after Holder exercises or converts this Warrant and, if applicable, the Company receives payment of the aggregate Warrant Price, 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 Shares not so acquired or converted.

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 shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.

1.6 Treatment of Warrant Upon Acquisition or Initial Public Offering.

1.6.1 “Acquisition”. For the purpose of this Warrant, “Acquisition” means (i) any acquisition of the Company by means of merger or other form of corporate reorganization in which outstanding shares of the Company are exchanged for securities or other consideration issued, or caused to be issued, by the acquiring corporation or its subsidiary (other than a mere reincorporation transaction) and pursuant to which the holders of the outstanding voting securities of the Company immediately prior to such consolidation, merger or other transaction fail to hold equity securities representing a majority of the voting power of the Company or surviving entity immediately following such consolidation, merger or other transaction (excluding voting securities of the acquiring corporation held by such holders prior to such transaction)(a “Merger”), (ii) the sale or transfer by the Company, in a single transaction or in a series of related transactions, of securities representing a majority of the voting power of the

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Company or (iii) a sale, license or transfer In a single transaction or in a series of related transactions of all, or substantially all, of the assets of the Company (an “Asset Sale”).

1.6.2 Treatment of Warrant Upon Acquisition or Initial Public Offering.

(A) Upon the written request of the Company, Holder agrees that, in the event of an Acquisition that is an “arms length” Asset Sale (a “True Asset Sale”) in which the sole consideration consists of (i) cash and/or (ii) publicly-traded securities listed on a national market or exchange which are freely tradable without restrictions (other than routine filing requirements such as required pursuant to Rule 144 under the Securities Act of 1933, as amended (the “Act”)) within 90 days of the close of such Acquisition (such cash and/or securities, the “Requisite Consideration”), either (a) Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be deemed effective immediately prior to the consummation of such Acquisition or (b) if Holder elects not to exercise the Warrant, this Warrant will expire upon the consummation of such Acquisition. The Company shall provide Holder with written notice of its request relating to the foregoing (together with such reasonable information as Holder may request in connection with such contemplated Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) days prior to the closing of the proposed Acquisition.

(B) Upon the written request of the Company, Holder agrees that, in the event of an Acquisition that is a Merger in which the sole consideration consists of the Requisite Consideration, either (a) Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be deemed effective immediately prior to the consummation of such Acquisition or (b) if Holder elects not to exercise the Warrant, this Warrant will expire upon the consummation of such Acquisition. The Company shall provide Holder with written notice of its request relating to the foregoing (together with such reasonable information as Holder may request in connection with such contemplated Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) days prior to the closing of the proposed Acquisition.

(C) Upon the closing of any Acquisition other than those particularly described in subsections (A) and (B) above, the successor entity shall assume the obligations of this Warrant, and this Warrant shall be exercisable for the same securities, cash, and 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 Warrant Price and/or number of Shares shall be adjusted accordingly.

(D) Holder agrees that, in the event of an IPO in connection with which all outstanding shares of the Company’s preferred stock are or will be converted into shares of common stock (a “Qualified IPO”), either (a) Holder shall exercise its conversion or purchase right under this Warrant, which such exercise may be made expressly conditioned upon, and subject to, the closing of the Qualified IPO or (b) if Holder elects not to exercise this Warrant, this Warrant will expire upon the closing of the Qualified IPO.

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(E) If not previously exercised pursuant to this Warrant, upon the first anniversary date of the closing of an IPO that is not a Qualified IPO (a “Nonqualified IPO”), either (a) Holder shall exercise its conversion or purchase right under this Warrant or (b) if Holder elects not to exercise the Warrant, this Warrant will expire. Notwithstanding the foregoing, if prior to a Nonqualified IPO Borrower’s underwriters object to the survival of this Warrant following the closing of such Nonqualified IPO, then Holder shall agree to amend this Warrant to provide that this Warrant will be deemed to be automatically converted pursuant to Section 1.2 upon the closing of such Nonqualified IPO.

ARTICLE 2. ADJUSTMENTS TO THE SHARES.

2.1 Stock Dividends, Splits, Etc. If the Company declares or pays a dividend on the Shares payable in common stock, or other securities, 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 occurred. If the Company subdivides the Shares by reclassification or otherwise into a greater number of shares or takes any other action which increase the amount of stock into which the Shares are convertible, the number of shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased. If the outstanding shares are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately Increased and the number of Shares shall be proportionately decreased.

2.2 Reclassification, Exchange, Combinations 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; provided, however, that such adjustment shall not be made with respect to, and this Warrant shall terminate if not exercised prior to the events set forth in Sections 1.6.2(A), (B), (D) or (E). Such an event shall include any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to common stock pursuant to the terms of the Company’s Amended and Restated Certificate of Incorporation dated September 27, 2006 (as the same may be amended and/or restated from time to time, the “Charter”) upon the closing of an IPO. Provided that the Company promptly deliver, at its expense, a certificate executed by the Company’s Chief Executive Officer, President or a Vice President setting forth such adjustment and showing in detail the facts upon which such adjustment is based pursuant to the terms of the Charter, the form of this Warrant need not be changed because of any adjustment under this Section 2.2. The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events.

2.3 Adjustments for Diluting Issuances. The conversion price of the Shares (so long as the Shares are convertible into common stock) is subject to adjustment pursuant to and as set forth in the Charter. The provisions set forth in the

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Charter relating to the adjustment of the conversion price of the same series as the Shares in effect as of the Issue Date may not be amended, modified or waived without the prior written consent of Holder if (and only if) such amendment, modification or waiver adversely affects the rights associated with the Shares in a manner different than the rights associated with all other shares of the same series as the Shares.

2.4 No Impairment. The Company shall not, by amendment of its Charter 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; provided, however, that notwithstanding the foregoing, nothing in this Article 2.4 shall restrict or impair the Company’s right to effect any changes to the rights, preferences, privileges or restrictions associated with the Shares so long as such changes do not adversely affect the rights, preferences, privileges or restrictions associated with the Shares in a manner different from the effect that such changes have generally on the rights, preferences, privileges or restrictions associated with all other shares of the same series as the Shares.

2.5 Fractional Shares. No fractional Shares shall be issuable upon exercise or conversion of this 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 the Warrant, the Company shall eliminate such fractional share interest by paying Holder the amount computed by multiplying the fractional interest by the fair market value of a full Share.

2.6 Certificate as to Adjustments. Upon each adjustment of the Warrant Price, the Company shall promptly notify Holder in writing, and, at the Company’s expense, promptly compute such adjustment, and furnish Holder with a certificate of 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 Warrant Price in effect upon the date thereof and the series of adjustments leading to such Warrant Price.

ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

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

(a) The initial Warrant Price referenced on the first page of this Warrant is not greater than the price per share at which shares of the same series as the Shares were issued in connection with the Company’s Series E round of equity financing (which was the last issuance of shares of the same series as the Shares in an arms-length transaction in which at least $500,000 of shares of the same series as the Shares were sold).

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(b) All Shares which may be issued upon the exercise of the purchase right represented by this Warrant, and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.

(c) The Company’s pro forma capitalization table attached hereto as Schedule 1 is true and correct as of the Issue Date.

3.2 Notice of Certain Events. If the Company proposes at any time (a) to declare any dividend or distribution upon any of its stock, whether in cash, property, stock, or other securities and whether or not a regular cash dividend; (b) prior to an IPO to offer for sale any shares of the Company’s capital stock (or other securities convertible into such capital stock), other than (i) pursuant to the Company’s stock option or other compensatory plans, (ii) in connection with commercial credit arrangements or equipment financings, or (iii) in connection with strategic transactions for purposes other than capital raising; (c) to effect any reclassification or recapitalization of any of its stock; (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; or (e) offer holders of registration rights the opportunity to participate in an underwritten public offering of the Company’s securities for cash, 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 common stock will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (a) and (b) above; (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 will take place (and specifying the date on which the holders of common stock will be entitled to exchange their common stock for securities or other property deliverable upon the occurrence of such event); and (3) in the case of the matter referred to in (e) above, the same notice as is given to the holders of such registration rights. Company will also provide information requested by Holder reasonably necessary to enable Holder to comply with Holder’s accounting or reporting requirements.

3.3 Registration Under Securities Act of 1933, as amended. Registration Under Securities Act of 1933, as amended. The Company and Holder agree that Holder shall, upon any exercise of this Warrant, become a party to the Company’s Amended and Restated Investors’ Rights Agreement, dated as of October 2, 2006 (as the same may be amended and/or restated from time to time, the “IRA”), and that the common stock issued or issuable upon conversion of the Shares shall be Registrable Securities (as defined in the IRA) for purposes of the registration rights enumerated in Sections 2.3 and 2.4 of the IRA provided that Holder agrees to be bound by all of the terms and conditions set forth in Sections 2, 5 and 6 of the IRA. In furtherance of the foregoing, Holder shall execute a counterpart signature page to the IRA (the “IRA Signature Page”) upon any exercise of this Warrant, which IRA shall be appropriately amended on or prior to such exercise date to provide for the foregoing.

3.4 No Shareholder Rights. Except as provided in this Warrant, Holder will not have any rights as a shareholder of the Company until the exercise of this Warrant.

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ARTICLE 4. REPRESENTATIONS, WARRANTIES OF HOLDER. Holder represents and warrants to the Company as follows:

4.1 Purchase for Own Account. This Warrant and the securities to be acquired upon exercise of this Warrant by Holder will be acquired for investment for Holder’s account, not as a nominee or agent, and not with a view to the public resale or distribution within the meaning of the Act. Holder also represents that Holder has not been formed for the specific purpose of acquiring this Warrant or the Shares.

4.2 Disclosure of information. Holder has received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision with respect to the acquisition of this Warrant and its underlying securities. Holder further has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify any information furnished to Holder or to which Holder has access.

4.3 Investment Experience. Holder understands that the purchase of this Warrant and its underlying securities involves substantial risk. Holder has experience as an investor in securities of companies in the development stage and acknowledges that Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such knowledge and experience in financial or business matters that Holder is capable of evaluating the merits and risks of its investment in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and certain of its officers, directors or controlling persons of a nature and duration that enables Holder to be aware of the character, business acumen and financial circumstances of such persons.

4.4 Accredited Investor Status. Holder is an “accredited investor” within the meaning of Regulation D promulgated under the Act.

4.5 The Act. Holder understands that this Warrant and the Shares issuable upon exercise or conversion hereof have not been registered under the Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Holder’s investment intent as expressed herein. Holder understands that this Warrant and the Shares issued upon any exercise or conversion hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are otherwise available.

ARTICLE 5. MISCELLANEOUS.

5.1 Term. Subject to termination pursuant to Section 1.6.2, this Warrant is exercisable in whole or in part at any time and from time to time on or before the Expiration Date.

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5.2 Legends. This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form:

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.

5.3 Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this Warrant (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) 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 Silicon Valley Bank (“Bank”) to provide an opinion of counsel if the transfer is to Bank’s parent company, SVB Financial Group (formerly Silicon Valley Bancshares), or any other affiliate of Bank (provided such other affiliate of Bank is an “accredited investor” within the meaning of Regulation D promulgated under the Act). Additionally, the Company shall also not require an opinion of counsel if there is no material question as to the availability of current information as referenced in Rule 144(c), Holder represents that it has complied with Rule 144(d) and (e) in reasonable detail, the selling broker represents that it has complied with Rule 144(f), and the Company is provided with a copy of Holder’s notice of proposed sale.

5.4 Transfer Procedure. After receipt by Bank of the executed Warrant, Bank will transfer all of this Warrant to SVB Financial Group by execution of an Assignment substantially in the form of Appendix 2. Subject to the provisions of Section 5.3 and upon providing the Company with written notice, SVB Financial Group and any subsequent Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the Shares issuable directly or indirectly, upon conversion of the Shares, if any) to any transferee, provided, however, in connection with any such transfer, (i) SVB Financial Group or any subsequent Holder will give the Company notice of the portion of the Warrant being transferred with the name, address and taxpayer identification number of the transferee, (ii) Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder If applicable), and (iii) Holder and any such transferee(s) shall execute an Assignment substantially in the form of Appendix 2. The Company may refuse to transfer this Warrant or the Shares to any person who directly competes with the Company, unless, in either case, the stock of the Company is publicly traded. Subject to the foregoing, this Warrant shall inure to the benefit of, and be binding upon, the parties hereto and their respective successors, assignees, and transferees.

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5.5 Notices. All notices and other communications from the Company to Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or Holder, as the case may (or on the first business day after transmission by facsimile) be, in writing by the Company or such Holder from time to time. Effective upon receipt of the fully executed Warrant and the initial transfer described in Section 5.4 above, all notices to Holder shall be addressed as follows until the Company receives notice of a change of address in connection with a transfer or otherwise:

SVB Financial Group

Attn: Treasury Department

3003 Tasman Drive, HA 200

Santa Clara, CA 95054

Telephone: 408-654-7400

Facsimile: 408-496-2405

Notice to the Company shall be addressed as follows until Holder receives notice of a change in address:

Danger, Inc.

3101 Park Blvd.

Palo Alto, California 94306

Attn: Nancy Hilker

Telephone: 650-289-6612

Facsimile: 650.289.5001

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 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 exercise hereof) as determined in accordance with Section 1.3 above is greater than the Warrant Price in effect on such date, then this Warrant, to the extent then outstanding, 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 Holder.

5.9 Counterparts. This Warrant may be executed in counterparts, all of which together shall constitute one and the same agreement.

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5.10 Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its principles regarding conflicts of law.

5.11 Market Stand-Off Provision. The holder hereby agrees to be bound by the “Market Stand-Off” provision (the “Market Stand Off Provision”) in Section 2.11 of the IRA. The Market Stand-Off Provision set forth in the Rights Agreement may not be amended, modified or waived without the prior written consent of Holder if (and only if) such amendment, modification or waiver adversely affects the rights associated with the Shares in a manner different than the rights associated with all other shares of the same series as the Shares.

[Signature page follows.]

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“COMPANY”
DANGER, INC.
By:	/s/ Henry R. Nothhaft
Name:	HANK NOTHHAFT
Title:	CEO
“HOLDER”
SILICON VALLEY BANK
By:	/s/ Nina Davies
Name:	NINA DAVIES
Title:	RELATIONSHIP MANAGER

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APPENDIX 1

NOTICE OF EXERCISE

1. Holder elects to purchase                      shares of the Common/Series                      Preferred [strike one] Stock of Danger, Inc. pursuant to the terms of the attached Warrant, and tenders payment of the purchase price of the shares in full.

[or]

1. Holder elects to convert the attached Warrant into Shares/cash [strike one] in the manner specified in the Warrant. This conversion is exercised for                      of the Shares covered by the Warrant.

[Strike paragraph that does not apply.]

2. Please issue a certificate or certificates representing the shares in the name specified below:

Holders Name

(Address)

3. By its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in Article 4 of the Warrant as the date hereof.

HOLDER:

By:

Name:

Title:

(Date):

12

APPENDIX 2

ASSIGNMENT

For value received, Silicon Valley Bank hereby sells, assigns and transfers unto

Name:	SVB Financial Group
Address:	3003 Tasman Drive (HA-200)
	Santa Clara, CA 95054
Tax ID:	91-1962278

that certain Warrant to Purchase Stock Issued by Danger, Inc. (the “Company”), on October 12, 2007 (the “Warrant”) together with all rights, title and interest therein.

	SILICON VALLEY BANK
	By:
	Name:
	Title:
Date:

By its execution below, and for the benefit of the Company, SVB Financial Group makes each of the representations and warranties set forth in Article 4 of the Warrant and agrees to all other provisions of the Warrant as of the date hereof.

SVB FINANCIAL GROUP

By:

Name:

Title:

EX-10.2

EXHIBIT 10.2

EXECUTION COPY

DANGER, INC.

EXECUTIVE EMPLOYMENT AGREEMENT

for

Henry R. Nothhaft

This Executive Employment Agreement (“Agreement”) is entered into by and between Henry R. Nothhaft (“Executive”) and Danger, Inc., (the “Company”), effective as of June 13, 2007 (“Effective Date”).

WHEREAS, the Company desires to continue to employ Executive to provide personal services to the Company, and wishes to provide Executive with certain compensation and benefits in return for his services; and

WHEREAS, Executive wishes to continue to be employed by the Company and provide personal services to the Company in return for certain compensation and benefits; and

WHEREAS, Executive and the Company are party to a previous offer letter dated September 18, 2002, as amended on October 1, 2004 (“Offer Letter”) governing the terms of Executive’s employment with the Company; and

WHEREAS, Executive and the Company agree that, except as expressly provided herein, this Agreement shall supersede and replace the Offer Letter and any other oral or written agreements regarding the terms of Executive’s employment with the Company;

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, it is hereby agreed by and between the parties hereto as follows:

1. EMPLOYMENT BY THE COMPANY.

1.1 Position. Subject to terms set forth herein, the Company agrees to continue to employ Executive in the position of Chief Executive Officer and Chairman of the Company’s Board of Directors (“Board”). Executive understands and agrees that in the event that he is no longer acting as Chief Executive Officer, he shall, upon request from the Board, immediately take all steps necessary to effectuate his resignation as a member of the Board of Directors. During the term of his employment with the Company, Executive will devote his best efforts and substantially all of his business time and attention to the business of the Company, except for vacation periods as provided herein and pursuant to the Company’s vacation policies, and reasonable periods of illness or other incapacities permitted by the Company’s general employment policies.

1.2 Duties and Location. Executive shall serve in an executive capacity and shall perform such duties as are customarily associated with his then current title, consistent with the Bylaws of the Company and as required by the Board. Executive will report to the Board. Executive will be responsible for the corporate, administrative and business-related functions of the Company, and any other areas of responsibility assigned to

1.

him by the Board. Executive’s performance goals will be determined by the Board in approximately January of each year, after consultation with Executive. Executive’s primary office location shall be the Company’s corporate headquarters in Palo Alto, California. The Company reserves the right to reasonably require Executive to perform his duties at places other than its corporate headquarters from time to time and to require reasonable business travel.

1.3 Policies and Procedures. The employment relationship between the parties shall also be governed by, and Executive agrees to comply with, the general employment policies and practices of the Company, including but not limited to those policies contained in the Company’s Handbook, except that when the terms of this Agreement differ from or are in conflict with the Company’s general employment policies or practices, this Agreement shall control.

2. COMPENSATION.

2.1 Salary. Executive shall receive for services to be rendered hereunder an initial annualized base salary of $433,888 (“Base Salary”), subject to payroll withholdings and deductions and payable in accordance with the Company’s regular payroll schedule. Such salary shall be reviewed annually and may be modified as approved by the Board.

2.2 Bonus. Executive will be eligible to earn an annual bonus as determined by the Board upon the recommendations of its Compensation Committee and provided that Executive remains employed by the Company as of the date the bonus is calculated. The bonus amount, if any, will be based on the Company’s performance in meeting its planned operating objectives, as determined by the Board in its sole discretion. Any bonus earned may be payable in any combination of cash, stock, or options to acquire shares of Company stock, at the discretion of the Board.

2.3 Stock Options.

(a) Existing Options. Executive has been granted the following options to purchase the Company Common Stock:

Date of Grant	ISO/NQ	Shares	Exercise Price
10/28/2002	ISO	400,000	$	0.2500
10/28/2002	NQ	3,643,778	$	0.2500
3/11/2003	ISO	380,000	$	0.2500
7/24/2003	ISO	20,000	$	0.2500
7/24/2003	NQ	170,000	$	0.2500
6/9/2004	ISO	190,000	$	0.2500
10/13/2004	NQ	2,590,001	$	0.2500
10/13/2004	ISO	209,999	$	0.2500
6/29/2006	NQ	1,170,000	$	0.2500
6/29/2006	ISO	400,000	$	0.2500
	Total	9,173,778

2.

(b) New Grant. The Company will recommend that the Board of Directors grant Executive an option to purchase 1,150,000 shares of the Company’s Common Stock (“Option”) with an exercise price equal to the fair market value on the date of the grant. These option shares will vest at the rate of 1/48^th each month. Vesting will, of course, depend on Executive’s continued employment with the Company. The Option will be an incentive stock option to the maximum extent allowed by the tax code and will be subject to the terms of the Company’s 2000 Stock Option/Stock Issuance Plan and the Stock Option Agreement between Executive and the Company, which shall provide, among other conditions, that the post-termination exercise period for the vested portion of the Option shall be six (6) months from the date of termination.

(c) Subsequent Option Grants. Subject to the discretion of the Company’s Board of Directors, Executive may be eligible to receive additional grants of stock options or purchase rights from time to time in the future, on such terms and subject to such conditions as the Board of Directors shall determine as of the date of any such grant. The terms of any subsequent stock option grants shall include, among other conditions, that the post-termination exercise period for the vested portion of such option grants shall be six (6) months from the date of termination.

2.4 Standard Company Benefits. Executive shall be entitled to all rights and benefits for which he is eligible under the terms and conditions of the standard Company benefits and compensation practices which may be in effect from time to time and provided by the Company to its employees generally. Standard Company benefits include medical, dental and vision insurance, short-term and long-term disability insurance, 401(k) plan participation, paid time off and holidays. Notwithstanding anything to the contrary set forth in the Company’s policies and procedures regarding the accrual of paid time off (PTO), Executive’s PTO accrual shall not be subject to a cap or any other maximum accrual.

2.5 Personal Life Insurance. The Company will reimburse Executive for premiums of up to a maximum amount of $8,000 per year for personal life insurance coverage.

2.6 Home Connectivity. Executive will be entitled to monthly reimbursement for actual expenditure on broad band connection at up to two residences, not to exceed $350 per month.

2.7 Health Insurance Supplement. Executive will be entitled to a health insurance coverage supplement, not to exceed $800.00 per month, to eliminate any out of pocket costs for heath coverage for Executive or any persons covered by his Company sponsored health insurance policy.

2.8 Tax Consulting Services. Executive will be entitled to receive reimbursement for actual expenditures for tax consulting services not to exceed $5,000 per year.

3.

2.9 Business Class Travel. Executive will be entitled to business class airline travel on all domestic and international flights either paid for or reimbursed by the Company when upgrades through other means are unavailable.

2.10 Expense Reimbursement. Executive shall receive, against presentation of proper receipts and vouchers, reimbursement for direct and reasonable out-of-pocket expenses incurred by him in connection with the performance of his duties hereunder, according to the policies of the Company.

3. PROPRIETARY INFORMATION OBLIGATIONS.

3.1 Agreement. As a condition of employment, Executive agrees to continue to abide by the Company’s Confidential Information and Inventions Agreement (the “Confidential Information Agreement”) previously executed by Executive and attached hereto as Exhibit A.

3.2 Remedies. Executive’s duties under the Confidential Information Agreement shall survive termination of his employment with the Company. Executive acknowledges that a remedy at law for any breach or threatened breach by him of the provisions of the Confidential Information Agreement would be inadequate, and he therefore agrees that the Company shall be entitled to injunctive relief in case of any such breach or threatened breach.

4. OUTSIDE ACTIVITIES DURING EMPLOYMENT.

4.1 Non-Company Business. Except with the prior written consent of the Board, Executive will not during the term of this Agreement become engaged in any other business activity which, in the reasonable judgment of the Board, is likely to interfere with Executive’s ability to discharge his duties and responsibilities to the Company. Notwithstanding the foregoing, Executive may continue to be a member of the Board of Directors of no more than two outside companies and to engage in civic and not-for-profit activities so long as such activities do not create a conflict with his employment hereunder or materially interfere with the performance of his duties.

4.2 No Adverse Interests. Except as permitted by Section 4.3, Executive agrees not to acquire, assume or participate in, directly or indirectly, any position, investment or interest known by him to be adverse or antagonistic to the Company, its business or prospects, financial or otherwise.

4.3 Noncompetition. During the term of his employment with the Company, except on behalf of the Company, Executive will not directly or indirectly, whether as an officer, director, stockholder, partner, proprietor, associate, representative, consultant, or in any capacity whatsoever engage in, become financially interested in, participate in, be employed by or have any business connection with any other person, corporation, firm, partnership or other entity whatsoever which competes with the Company, anywhere throughout the world, in any line of business engaged in (or planned to be engaged in) by the Company; provided, however, that anything above to the contrary notwithstanding, he may own, as a passive investor, securities of any competitor corporation, so long as his direct

4.

holdings in any one such corporation shall not in the aggregate constitute more than one percent (1%) of the voting stock of such corporation, and provided that Executive promptly discloses to the Board any such participation.

5. TERMINATION. Executive and the Company each acknowledge that either party has the right to terminate Executive’s employment with the Company at any time for any reason whatsoever, with or with out cause or advance notice pursuant to the following:

(a) Termination by Death or Disability. Subject to applicable state or federal law, in the event that Executive shall die during his employment hereunder or become permanently disabled, as evidenced by notice to the Company and Executive’s inability to carry out his job responsibilities for a continuous period of more than six months, Executive’s employment and the Company’s obligation to make payments hereunder shall terminate on the date of his death, or the date upon which, in the sole determination of the Board of Directors, Executive has become permanently disabled, except that the Company shall pay Executive any salary earned but unpaid prior to termination, any benefits accrued prior to termination, all accrued but unused vacation, and any business expenses that were incurred but not reimbursed as of the date of termination. Vesting of all options shall cease on the date of such termination.

(b) Voluntary Resignation by Executive. In the event that Executive voluntarily terminates his employment with the Company other than for Good Reason (defined below), the Company’s obligation to make payments hereunder shall cease upon such termination, except that the Company shall pay Executive any salary earned but unpaid prior to termination, any benefits accrued prior to termination, all accrued but unused vacation, and any business expenses that were incurred but not reimbursed as of the date of termination. Vesting of all options shall cease on the date of such termination.

(c) Termination for Cause. In the event that Executive is terminated by the Company for Cause (as defined below), the Company’s obligation to make payments hereunder shall cease upon the date of receipt by Executive of written notice of such termination (the “Termination Date”), except that the Company shall pay Executive any salary earned but unpaid prior to the Termination Date, any benefits accrued prior to the Termination Date, all accrued but unused vacation and any business expenses that were incurred but not reimbursed as of the Termination Date. Vesting of all options shall cease on the Termination Date.

(d) Termination by the Company without Cause or by Executive for Good Reason (Absent Change In Control). In the event Executive’s employment is terminated by the Company without Cause (as defined herein) or Executive voluntarily resigns his employment for Good Reason (as defined herein) absent a Change in Control then following the execution of a Release by Executive in the form similar to Exhibit B and written acknowledgment of Executive’s continuing obligations under the Confidential Information Agreement, Executive shall be entitled to receive the following severance benefits: (i) the equivalent of eighteen (18) months of his Base Salary as in effect immediately prior to the termination date subject to employment tax withholding and deductions, payable in semi-monthly installments over eighteen (18) months in accordance with the Company’s standard

5.

payroll procedures commencing on the first regularly scheduled pay date following the Effective Date of the Release; (ii) provided that Executive is eligible for and timely elects continuation of his health insurance pursuant to COBRA, for a period of twelve (12) months following the Termination Date, the Company shall also reimburse Executive for the cost of COBRA premiums to be paid in order for Executive to maintain medical insurance coverage that is substantially equivalent to that which Executive received immediately prior to the termination provided, however, that the Company’s obligation to pay Executive’s COBRA premiums will cease immediately in the event Executive becomes eligible for group health insurance during the twelve (12) month period, and Executive hereby agrees to promptly notify the Company if he becomes eligible to be covered by group health insurance in such event; and (iii) the Company will vest the equivalent of fifty percent (50%) of Executive’s then unvested options to purchase shares of the Company’s Common Stock and such vesting shall occur upon the date of termination. All other terms and conditions set forth in the options, the Plan, and the applicable stock option agreements shall remain in full force and effect ((i) – (iii) collectively, the “Severance Benefits”).

(e) Definition of Cause. For purposes of this Agreement, “Cause” shall mean any of the following: (i) conviction of, or plea of guilty or no contest, with respect to any felony or to any crime involving fraud, dishonesty, or moral turpitude; (ii) participation in any fraud or act of dishonesty against the Company; (iii) failure to cooperate with the Company in any investigation or formal proceeding; or (iv) material breach of any agreement between Executive and the Company related to Executive’s employment by the Company, including, but not limited to this Agreement and the Confidential Information Agreement; provided, however that for Cause to exist under subsection (iv) above, the Company must give Executive written notice of the events described in subsection (iv) giving rise to Cause and Executive must fail to correct such events within twenty (20) days of the date such notice is given.

(f) Definition of Good Reason. For purposes of this Agreement, “Good Reason” means one or more of the following events is undertaken without Executive’s express consent: (i) the assignment to Executive of any duties or responsibilities which result in the material diminution of Executive’s position; provided, however, that the acquisition of the Company and subsequent conversion of the Company to a division or unit of the acquiring company will not by itself result in a diminution of Executive’s position; (ii) a material reduction by the Company in Executive’s annual total target compensation by greater than fifteen percent (15%), except to the extent that the total target compensation of other executive officers of the Company is accordingly reduced; (iii) a relocation of Executive, or the Company’s principal executive office to which Executive is assigned, that lengthens Executive’s one-way commute distance by more than fifty (50) miles; (iv) the Company’s material breach of this Agreement; or (v) the Company’s failure to obtain the assumption of this Agreement by any acquirer or successor of the Company. Executive must first give the Company an opportunity to cure any of the foregoing within thirty (30) days following delivery to the Company of a written explanation specifying the specific basis for Executive’s belief that he is entitled to terminate his employment for Good Reason.

6.

6. CHANGE IN CONTROL BENEFITS.

(a) Change of Control Termination. If: (i) Executive is involuntarily terminated by the Company (or its successor entity) other than for Cause; or (ii) Executive voluntarily terminates his employment with the Company (or its successor entity) for Good Reason, either within the two (2) months immediately preceding a Change in Control or in the twelve (12) months immediately following a Change in Control (either constituting a “Change of Control Termination”), and in each case Executive signs a Release and written acknowledgment of Executive’s continuing obligations under the Confidential Information Agreement, Executive shall be entitled to the following severance benefits: (i) the equivalent of twenty-four (24) months of his Base Salary as in effect immediately prior to the Change of Control Termination Date, subject to employment tax withholdings and deductions, payable in a lump sum on the first regularly scheduled payroll date following the Effective Date of the Release; (ii) provided that Executive is eligible for and timely elects continuation of his health insurance pursuant to COBRA, for a period of twelve (12) months following a Change in Control Termination, the Company shall also reimburse Executive for the cost of COBRA premiums to be paid in order for Executive to maintain medical insurance coverage that is substantially equivalent to that which Executive received immediately prior to the termination provided, however, that the Company’s obligation to pay Executive’s COBRA premiums will cease immediately in the event Executive becomes eligible for group health insurance during the twelve (12) month period, and Executive hereby agrees to promptly notify the Company if he becomes eligible to be covered by group health insurance in such event; and (iii) the Company will vest the equivalent of fifty percent (50%) Executive’s then unvested options to purchase shares of Company’s Common Stock and such vesting shall occur upon the occurrence of the Change in Control in the case of a Change in Control Termination occurring prior to the Change in Control or upon termination in the case of a Change in Control Termination occurring after the Change in Control. All other terms and conditions set forth in the options, the Plan, and the applicable stock option agreements shall remain in full force and effect ((i) – (iii) collectively “Change in Control Severance Benefits”).

(b) Definition of Change in Control. For purposes of this Agreement, “Change in Control” of the Company shall mean either of the following stockholder-approved transactions to which the Company is a party:

(i) a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction; or

(ii) the sale, transfer or other disposition of all or substantially all of the Company’s assets in complete liquidation or dissolution of the Company.

7.

7. LIMITATIONS AND CONDITIONS ON PAYMENT OF BENEFITS

7.1 Parachute Payments.

(a) Best After-Tax. If any payment or benefit (including payments and benefits pursuant to this Agreement) Executive would receive in connection with a Change in Control from the Company or otherwise (“Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Company shall cause to be determined, before any amounts of the Payment are paid to Executive, which of the following two alternative forms of payment would maximize Executive’s after-tax proceeds: (i) payment in full of the entire amount of the Payment (a “Full Payment”); or (ii) payment of only a part of the Payment so that Executive receives the largest payment possible without the imposition of the Excise Tax (a “Reduced Payment”), whichever amount results in Executive’s receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. For purposes of determining whether to make a Full Payment or a Reduced Payment, the Company shall cause to be taken into account all applicable federal, state and local income and employment taxes and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes). If a Reduced Payment is made: (i) the Payment shall be paid only to the extent permitted under the Reduced Payment alternative, and Executive shall have no rights to any additional payments and/or benefits constituting the Payment; and (ii) reduction in payments and/or benefits shall occur in the following order unless Executive elects in writing a different order (provided, however, that such election shall be subject to Company approval if made on or after the date on which the event that triggers the Payment occurs): (1) reduction of cash payments; (2) cancellation of accelerated vesting of equity awards other than stock options; (3) cancellation of accelerated vesting of stock options; and (4) reduction of other benefits paid to Executive. In the event that acceleration of vesting from Executive’s equity awards is to be reduced, such acceleration of vesting shall be canceled in the reverse order of the date of grant unless Executive elects in writing a different order for cancellation.

(b) The independent registered public accounting firm engaged by the Company for general audit purposes as of the day prior to the effective date of the Change in Control shall make all determinations required to be made under this Section 7.1. If the independent registered public accounting firm so engaged by the Company is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, the Company shall appoint a nationally recognized independent registered public accounting firm to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations by such independent registered public accounting firm required to be made hereunder.

(c) The independent registered public accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and Executive within fifteen (15) calendar days

8.

after the date on which Executive’s right to a Payment is triggered (if requested at that time by the Company or Executive) or such other time as requested by the Company or Executive. If the independent registered public accounting firm determines that no Excise Tax is payable with respect to a Payment, either before or after the application of the Reduced Amount, it shall furnish the Company and Executive with an opinion reasonably acceptable to Executive that no Excise Tax will be imposed with respect to such Payment. Any good faith determinations of the accounting firm made hereunder shall be final, binding and conclusive upon the Company and Executive.

7.2 Application of Section 409A. In the event that the Company determines that any cash severance payment benefit, accrued and unpaid bonus payment, or continued health, dental and vision insurance coverage benefits provided under this Agreement fails to satisfy the distribution requirement of Section 409A(a)(2)(A) of the Code as a result of Section 409A(a)(2)(B)(i) of the Code, the payment of such benefit shall be accelerated to the minimum extent necessary so that the benefit is not subject to the provisions of Section 409A(a)(1) of the Code. (The payment schedule as revised after the application of the preceding sentence shall be referred to as the “Revised Payment Schedule.”) However, in the event the payment of benefits pursuant to the Revised Payment Schedule would be subject to Section 409A(a)(1) of the Code, the payment of such benefits shall not be paid pursuant to the Revised Payment Schedule and instead the payment of such benefits shall be delayed to the minimum extent necessary so that such benefits are not subject to the provisions of Section 409A(a)(1) of the Code. The Board may attach conditions to or adjust the amounts paid pursuant to this Section 7.2 to preserve, as closely as possible, the economic consequences that would have applied in the absence of this Section 7.2; provided, however, that no such condition or adjustment shall result in the payments being subject to Section 409A(a)(1) of the Code.

8. NONINTERFERENCE.

While employed by the Company, and for one (1) year immediately following the termination of his employment for any reason, Executive agrees not to interfere with the business of the Company by, directly or indirectly:

(a) soliciting, attempting to solicit, inducing, encouraging, or otherwise causing any employee of the Company to terminate employment in order to become an employee, consultant or independent contractor to or for any other entity or business; or

(b) soliciting the business of any customer of the Company which at the time of termination or during the year immediately prior thereto was listed on the Company’s customer list, if such solicitation involves the use or disclosure of any confidential or proprietary information or trade secrets of the Company.

9. COOPERATION WITH COMPANY. During and for a period of twelve (12) months after the termination of Executive’s employment, Executive will cooperate with the Company in responding to the reasonable requests of the Board or General Counsel (whether internal or external), in connection with any and all litigation, arbitrations, mediations or investigations brought by or against the Company, or its affiliates, agents, officers, directors

9.

or employees, whether administrative, civil or criminal in nature, in which the Company reasonably deems Executive’s cooperation necessary or desirable, and taking into consideration Executive’s time commitments at such time. In such matters, Executive agrees to provide the Company, upon reasonable notice to Executive, with reasonable advice, assistance and information, including offering and explaining evidence, providing sworn statements, and participating in discovery and trial preparation and providing truthful and accurate testimony. Executive also agrees to promptly send the Company copies of all correspondence (for example, but not limited to, subpoenas) received by Executive in connection with any such legal proceedings, unless Executive is expressly prohibited by law from so doing.

10. DISPUTE RESOLUTION. To ensure the timely and economical resolution of disputes that may arise in connection with Executive’s employment with the Company, Executive and the Company agree that any and all disputes, claims, or causes of action arising from or relating to the enforcement, breach, performance, negotiation, execution, or interpretation of this Agreement, Executive’s employment, or the termination of Executive’s employment, shall be resolved by confidential, final and binding arbitration conducted before a single arbitrator with JAMS, Inc. (“JAMS”) in Santa Clara, California, under the then-applicable JAMS rules. The parties acknowledge that by agreeing to this arbitration procedure, they waive the right to resolve any such dispute through a trial by jury, judge or administrative proceeding. The Company shall bear JAMS’ arbitration fees and administrative costs. The arbitrator shall: (a) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be permitted by law; and (b) issue a written arbitration decision including the arbitrator’s essential findings and conclusions and a statement of the award. The arbitrator, and not a court, shall also be authorized to determine whether the provisions of this paragraph apply to a dispute, controversy, or claim sought to be resolved in accordance with these arbitration procedures. Nothing in this Agreement is intended to prevent either Executive or the Company from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion of any such arbitration.

11. GENERAL PROVISIONS.

11.1 Notices. Any notices provided hereunder must be in writing and shall be deemed effective upon the earlier of personal delivery (including personal delivery by fax) or the next day after sending by overnight carrier, to the Company at its primary office location and to Executive at his address as listed on the Company payroll records.

11.2 Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction to the extent possible in keeping with the intent of the parties and applicable law.

10.

11.3 Waiver. To be effective any waiver of a breach of any provision of this Agreement shall be in writing and it shall not be deemed to be a waiver of any preceding or succeeding breach of the same or any other provision of this Agreement.

11.4 Complete Agreement. This Agreement and its exhibits constitute and form the complete, final, and exclusive embodiment of the entire agreement between Executive and the Company concerning the subject matters hereof. This Agreement is entered into without reliance on any promise or representation other than those expressly contained therein, and the terms hereof, except with respect to those changes expressly reserved to the Company’s or Board’s discretion in this Agreement, cannot be modified or amended except in a written agreement approved by the Board and signed by Executive and an officer of the Company.

11.5 Review By Compensation Committee. Provided that Executive remains employed by the Company on the second anniversary of the Effective Date of this Agreement, the Compensation Committee will, at its next regularly scheduled meeting, confer with Executive and discuss any appropriate adjustments to the terms contained herein.

11.6 Construction and Counterparts. For purposes of construction of this Agreement, any ambiguity shall not be construed against either party as the drafter. This Agreement may be executed in separate counterparts, any one of which need not contain signatures of more than one party, but all of which taken together will constitute one and the same Agreement. Signatures transmitted via facsimile shall be deemed equivalent to original signatures.

11.7 Headings. The headings of the sections hereof are inserted for convenience only and shall not be deemed to constitute a part hereof nor to affect the meaning thereof.

11.8 Successors and Assigns. This Agreement is intended to bind and inure to the benefit of and be enforceable by Executive and the Company, and their respective successors, assigns, heirs, executors and administrators, except that Executive may not assign any of his duties hereunder and he may not assign any of his rights hereunder without the written consent of the Company, which shall not be withheld unreasonably.

11.9 Choice of Law. All questions concerning the construction, validity and interpretation of this Agreement will be governed by the law of the State of California without regard to conflicts of law principles.

11.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written.

Danger, Inc.
By:	/s/ Jeffrey Brody
	Director
Date: June 13, 2007

UNDERSTOOD and AGREED to this 13th day of June, 2007.

/s/ Henry R. Nothhaft

Henry R. Nothhaft, an Individual

12.

EXECUTION COPY

EXHIBIT A

EMPLOYEE PROPRIETARY INFORMATION AND INVENTIONS

AGREEMENT

EMPLOYEE

PROPRIETARY INFORMATION

AND INVENTIONS AGREEMENT

The following confirms an agreement between me and Danger, Inc., a Delaware corporation (the “Company”), which is a material part of the consideration for my employment with the Company:

1. Proprietary Information. I understand that the Company possesses and will possess Proprietary Information that is important to its business. For purposes of this Agreement, “Proprietary Information” is information that was or will be developed, created, or discovered by or on behalf of the Company, or that became or will become known by, or was or is conveyed to the Company, that has commercial value in the Company’s business. “Proprietary Information” includes, without limitation, information (whether conveyed orally or in writing) about algorithms, application programming interfaces, protocols, trade secrets, computer software, designs, technology, ideas, know-how, products, services, processes, data, techniques, improvements, inventions (whether patentable or not), works of authorship, business and product development plans, the salaries and terms of compensation of other employees, customer lists and other information concerning the Company’s actual or anticipated business, research or development, or that is received in confidence by or for the Company from any other person. I understand

that my employment creates a relationship of confidence and trust between me and the Company with respect to Proprietary Information.

2. Company Materials. I understand that the Company possesses or will possess “Company Materials” that are important to its business. For purposes of this Agreement, “Company Materials” are documents or other media or tangible items that contain or embody Proprietary Information or any other information concerning the business, operations or plans of the Company, whether such documents have been prepared by me or by others. “Company Materials” include, without limitation, blueprints, drawings, photographs, charts, graphs, notebooks, customer lists, computer software, media or printouts, sound recordings and other printed, typewritten or handwritten documents, as well as samples, prototypes, models, products and the like.

3. Intellectual Property. In consideration of my employment with the Company and the compensation received by me from the Company from time to time, I hereby agree as follows:

3.1 All Proprietary Information and all right title and interest in and to patents, patent rights, copyright rights, mask work rights, trade secret rights, and other intellectual property and proprietary rights anywhere in the world (collectively “Rights”) in connection therewith shall be the sole property of the Company. I hereby assign to the Company any Rights I may have or acquire in such Proprietary Information.

At all times, both during my employment with the Company and after its termination, I will keep in confidence and trust and will not use or disclose any Proprietary Information or anything relating to it without the prior written consent of an officer of the Company except as may be necessary and appropriate in the ordinary course of performing my duties to the Company.

3.2 All Company Materials shall be the sole property of the Company. I agree that during my employment with the Company, I will not remove any Company Materials from the business premises of the Company or deliver any Company Materials to any person or entity outside the Company, except as I am required to do in connection with performing the duties of my employment. I further agree that, immediately upon the termination of my employment by me or by the Company for any reason, or for no reason, or during my employment if so requested by the Company, I will return all Company Materials, apparatus, equipment and other physical property, or any reproduction of such property, excepting only (i) my personal copies of records relating to my compensation; (ii) my personal copies of any materials previously distributed generally to stockholders of the Company; and (iii) my copy of this Agreement.

3.3 I understand, in addition, that the Company has received and in the future will receive from third parties confidential or proprietary information (“Third Party Information”) subject to a duty on the Company’s part to maintain the

confidentiality of such information and to use it only for certain limited purposes. During the term of my employment and thereafter, I will hold Third Party Information in the strictest confidence and will not disclose (to anyone other than Company personnel who need to know such information in connection with their work for the Company) or use, except in connection with my work for the Company, Third Party Information unless expressly authorized by an officer of the Company in writing.

3.4 I will promptly disclose in writing to my immediate supervisor or to any persons designated by the Company, all “Inventions” (which term includes improvements, inventions (whether or not patentable), works of authorship, trade secrets, technology, algorithms, computer software, protocols, formulas, compositions, ideas, designs, processes, techniques, know-how and data) made or conceived or reduced to practice or developed by me (in whole or in part, either alone or jointly with others) during the term of my employment. I will also disclose to the Company, Inventions conceived, reduced to practice, or developed by me within six months of the termination of my employment with the Company; such disclosures shall be received by the Company in confidence, to the extent they are not assigned in Section 3.5 below, and do not extend such assignment. I will not disclose Inventions covered by Section 3.5 to any person outside the Company unless I am requested to do so by management personnel of the Company.

3.5 I agree that all Inventions that I make, conceive, reduce to practice or develop (in whole or in part, either alone or jointly with others) during my employment shall be the sole property of the Company to the maximum extent permitted by Section 2870 of the California Labor Code, a copy of which is attached and I hereby assign such Inventions and all Rights therein to the Company. No assignment in this Agreement shall extend to inventions, the assignment of which is prohibited by Labor Code Section 2870. The Company shall be the sole owner of all Rights in connection therewith.

3.6 I acknowledge that all original works of authorship that are made by me (solely or jointly with others) within the scope of my employment and that are protectable by copyright are “works made for hire,” as that term is defined in the United States Copyright Act (17 U.S.C., Section 101).

3.7 I agree to perform, during and after my employment, all acts deemed necessary or desirable by the Company to permit and assist it, at the Company’s expense, in evidencing, perfecting, obtaining, maintaining, defending and enforcing Rights and/or my assignment with respect to such Inventions in any and all countries. Such acts may include, without limitation, execution of documents and assistance or cooperation in legal proceedings. I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents, as my

agents and attorneys-in-fact, with full power of substitution, to act for and in my behalf and instead of me, to execute and file any documents and to do all other lawfully permitted acts to further the above purposes with the same legal force and effect as if executed by me.

3.8 Any assignment of copyright hereunder includes all rights of paternity, integrity, disclosure and withdrawal and any other rights that may be known as or referred to as “moral rights” (collectively “Moral Rights”). To the extent such Moral Rights cannot be assigned under applicable law and to the extent the following is allowed by the laws in the various countries where Moral Rights exist, I hereby waive such Moral Rights and consent to any action of the Company that would violate such Moral Rights in the absence of such consent. I will confirm any such waivers and consents from time to time as requested by the Company.

3.9 I have attached hereto a complete list of all existing Inventions to which I claim ownership as of the date of this Agreement and that I desire to specifically clarify are not subject to this Agreement, and I acknowledge and agree that such list is complete. If no such list is attached to this Agreement, I represent that I have no such Inventions at the time of signing this Agreement.

4. Non-Solicitation. During the term of my employment and for one year thereafter, I will not encourage or solicit any employee or consultant of the Company to

leave the Company for any reason. However, this obligation shall not affect any responsibility I may have as an employee of the Company with respect to the bona fide hiring and firing of Company personnel.

5. Non-Competition. I agree that during my employment with the Company, I will not engage in any employment, business, or activity that is in any way competitive with the business or proposed business of the Company, and I will not assist any other person or organization in competing with the Company or in preparing to engage in competition with the business or proposed business of the Company. The provisions of this paragraph shall apply both during normal working hours and at all other times including, without limitation, nights, weekends and vacation time, while I am employed with the Company.

6. No Conflict with Obligation to Third Parties. During my employment by the Company, I will not improperly use or disclose any confidential information or trade secrets, if any, of any former employer or any other person to whom I have an obligation of confidentiality, and I will not bring onto the premises of the Company any unpublished documents or any property belonging to any former employer or any other person to whom I have an obligation of confidentiality unless consented to in writing by that former employer or person. I represent that my performance of all the terms of this Agreement will not breach any agreement to keep in confidence proprietary information acquired by me in confidence or in trust prior to my employment with the Company.

I have not entered into, and I agree I will not enter into, any agreement either written or oral in conflict herewith or in conflict with my employment with the Company.

7. At-Will Employment. I agree that this Agreement is not an employment contract and that I have the right to resign and the Company has the right to terminate my employment at any time, for any reason, with or without cause.

8. Other Employee Obligations. I agree that this Agreement does not purport to set forth all of the terms and conditions of my employment, and that as an employee of the Company I have obligations to the Company that are not set forth in this Agreement.

9. Arbitration. I agree that any and all disputes that I have with the Company, or any of its employees, that arise out of my employment or under the terms of my employment, shall be resolved through final and binding arbitration, as specified herein. This shall include, without limitation, disputes relating to this Agreement, my employment by the Company or the termination thereof, claims for breach of contract or breach of the covenant of good faith and fair dealing, and any claims of discrimination or other claims under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the California Fair Employment and Housing Act, the Employee Retirement Income Securities Act, the Racketeer Influenced and Corrupt Practices Act, or any other federal, state or local law or regulation now in

existence or hereinafter enacted and as amended from time to time concerning in any way the subject of my employment with the Company or its termination. The only claims not covered by this Agreement are claims made pursuant to the California Labor Code for due and unpaid wages and claims for benefits under the unemployment insurance or workers’ compensation laws, which will be resolved pursuant to those laws. Binding arbitration will be conducted in San Francisco, California in accordance with the rules and regulations of the American Arbitration Association (AAA). Each party will split the cost of the arbitration filing and hearing fees, and the cost of the arbitrator; each side will bear its own attorneys’ fees; that is, the arbitrator will not have authority to award attorneys’ fees unless a statutory section at issue in the dispute authorizes the award of attorneys’ fees to the prevailing party, in which case the arbitrator has authority to make such award as permitted by the statute in question. I understand and agree that the arbitration shall be instead of any jury trial and that the arbitrator’s decision shall be final and binding to the fullest extent permitted by law and enforceable by any court having jurisdiction thereof.

10. Survival. I agree that my obligations under Sections 3.1 through 3.8, Section 4, and Section 9 of this Agreement shall continue in effect after termination of my employment, regardless of the reason or reasons for termination, and whether such termination is voluntary or involuntary on my part, and that the Company is entitled to communicate my obligations under this Agreement to any future employer or potential employer of mine.

11. Controlling Law; Severability. I agree that any dispute in the meaning, effect or validity of this Agreement shall be resolved in accordance with the laws of the State of California without regard to the conflict of laws provisions thereof. I further agree that if one or more provisions of this Agreement are held to be illegal or unenforceable under applicable California law, such illegal or unenforceable portion(s) shall be limited or excluded from this Agreement to the minimum extent required so that this Agreement shall otherwise remain in full force and effect and enforceable in accordance with its terms.

12. Successors and Assigns. This Agreement shall be effective as of the date I execute this Agreement and shall be binding upon me, my heirs, executors, assigns, and administrators and shall inure to the benefit of the Company, its subsidiaries, successors and assigns.

13. Legal and Equitable Remedies. Because my services are personal and unique and because I may have access to and become acquainted with the Proprietary Information of the Company, the Company shall have the right to enforce this Agreement and any of its provisions by injunction, specific performance or other equitable relief, without bond, without prejudice to any other rights and remedies that the Company may have for a breach of this Agreement.

14. Modification. This Agreement can only be modified by a subsequent written agreement executed by an officer of the Company.

EXECUTION COPY

I HAVE READ THIS AGREEMENT CAREFULLY AND I UNDERSTAND AND ACCEPT THE OBLIGATIONS THAT IT IMPOSES UPON ME WITHOUT RESERVATION. NO PROMISES OR REPRESENTATIONS HAVE BEEN MADE TO ME TO INDUCE ME TO SIGN THIS AGREEMENT. I SIGN THIS AGREEMENT VOLUNTARILY AND FREELY, IN DUPLICATE, WITH THE UNDERSTANDING THAT ONE COUNTERPART WILL BE RETAINED BY THE COMPANY AND THE OTHER COUNTERPART WILL BE RETAINED BY ME.

Dated: October 28,     02	/s/ Henry R. Nothhaft
	Employee Signature
	Henry R. Nothhaft
	Name(type or print)

Accepted and Agreed to:
DANGER RESEARCH, INC.
By:	/s/ Nancy J. Hilker
Name:	Nancy J. Hilker
Title:	CFO

EXECUTION COPY

ATTACHMENT A

Gentlemen:

1. The following is a complete list of Inventions relevant to the subject matter of my employment with Danger Research, Inc. (the “Company”) that have been made, conceived, developed or first reduced to practice by me (in whole or in part, either alone or jointly with others) prior to my employment by the Company that I desire to clarify are not subject to the Company’s Employee Proprietary Information and Inventions Agreement.

ü     No Inventions

         See below:

         Additional sheets attached

2. I propose to bring to my employment with the Company the following materials and documents of a former employer:

         No materials or documents

         See below:

/s/ Henry R. Nothhaft

Employee Signature

Henry R. Nothhaft

Name (type or print)

ATTACHMENT B

Section 2870. Application of provision providing that employee shall assign or offer to assign rights in invention to employer.

(a) Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information except for those inventions that either:

(1) Relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer; or

(2) Result from any work performed by the employee for the employer.

(b) To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable.

EXHIBIT B

RELEASE AGREEMENT

1. Consideration. I understand that my employment with Danger, Inc. (the “Company”) terminated effective                     , 20     (the “Separation Date”). The Company has agreed that if I choose to sign this Release Agreement (the “Release”), the Company will pay me certain severance and/or accelerate vesting, pursuant to the terms of the Executive Employment Agreement (the “Agreement”) between myself and the Company, and any agreements incorporated therein by reference. I understand that I am not entitled to such benefits unless I sign this Release and it becomes fully effective. I understand that, regardless of whether I sign this Release, the Company will pay me all of my accrued salary and accrued and unused paid time off through the Separation Date, to which I am entitled by law.

2. General Release. In exchange for the consideration provided to me under the Agreement that I am not otherwise entitled to receive, and as required by the Agreement, I hereby generally and completely release the Company and its directors, officers, employees, shareholders, partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, investors, insurers, affiliates, and assigns from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring prior to or on the date that I sign this Release. This general release includes, but is not limited to: (a) all claims arising out of or in any way related to my employment with the Company or the termination of that employment; (b) all claims related to my compensation or benefits from the Company, including salary, bonuses, commissions, paid time off, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company (excluding claims for any vested right to Company stock, earned compensation, expense reimbursement or any vested right under an ERISA-qualified plan document); (c) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (d) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (e) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Family and Medical Leave Act (“FMLA”), the federal Age Discrimination in Employment Act of 1967 (as amended) (“ADEA”), the California Family Rights Act (“CFRA”), the California Labor Code (as amended), and the California Fair Employment and Housing Act (as amended). Notwithstanding the release in the preceding sentence, I am not releasing any right of indemnification I may have in my capacity as an employee, officer and/or director of the Company pursuant to any express indemnification agreement or under applicable law, nor am I releasing any rights I may have as an owner and/or holder of the Company’s common stock and stock options.

3. ADEA Waiver. I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA, and that the consideration given for my release contained herein is in addition to anything of value to which I was already entitled. I further acknowledge that I have been advised by this writing, as

required by the ADEA, that: (a) my release does not apply to any rights or claims that arise after the date I sign this Release; (b) I should consult with an attorney prior to signing this Release (although I may choose voluntarily not to do so); (c) I have twenty-one (21) days to consider this Release (although I may choose voluntarily to sign it sooner); (d) I have seven (7) days following the date I sign this Release to revoke the Release in a written revocation provided to the Chairman of the Company’s Board of Directors; and (e) the Release will not be effective until the date upon which the revocation period has expired unexercised, which will be the eighth day after I sign this Release (“Effective Date”).

4. Section 1542 Waiver. In giving the general release herein, which includes claims which may be unknown to me at present, I acknowledge that I have read and understand Section 1542 of the California Civil Code, which reads as follows:

“A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”

I hereby expressly waive and relinquish all rights and benefits under that section and any law of any other jurisdiction of similar effect with respect to my release of claims contained herein, including but not limited to any unknown or unsuspected claims.

5. Representations. I hereby represent that I have been paid all compensation owed and for all hours worked, I have received all the leave and leave benefits and protections for which I am eligible, pursuant to FMLA, CFRA, or otherwise, and I have not suffered any on-the-job injury for which I have not already filed a workers’ compensation claim.

By:
	Henry R. Nothhaft
Date:

EX-10.3

Exhibit 10.3

July 23^rd, 2001

Joe Britt

Address

Address

Re: Severance Agreement of Danger, Inc. (the “Company”)

Dear Joe:

The Company is pleased to offer you the retention and severance benefits described in this letter agreement (the “Agreement”).

Section 1. Eligibility for Benefits.

The Company will grant you the severance benefits listed in Section 2 if you meet the all of the following eligibility factors:

(a) Your employment must have been terminated without “Cause” as set forth in Section 4.3(b) of the Restricted Stock Agreement (the “Stock Agreement”) between the Company and you dated September 22, 2000.

(b) You must remain on the job until your effective date of the termination as scheduled by the Company (the “Termination Date”). In addition, the right to receive severance benefits is specifically conditioned on satisfactory performance through the Termination Date, and no rights in the severance benefit shall vest until such date and only if satisfactory performance has been maintained.

(c) You must execute and deliver to the Company a waiver releasing the Company and its officers, directors, agents and employees, and each person in a control relationship with the Company from all losses and claims in connection

with your employment relationship in a form acceptable to the Company (the “General Release”). The General Release must be signed by you no earlier than the Termination Date of your employment and no later than the expiration of five calendar days from receipt of the release or such longer period allowed by law for you to consider and execute such release (the “Release Period”).

(d) You must have completed the exit procedures of the Company, including the return to the Company of all property and materials of the Company.

Section 2. Amount of Benefit.

The severance benefits granted pursuant to this Agreement, subject to Section 1, are as follows:

(a) You will receive from the Company continued payment of your monthly Base Pay as then in effect for a period of six months following the Termination Date, paid in accordance with the Company’s regular payroll practices, in addition to any benefits you may be entitled to under the Stock Agreement, as long as you execute a General Release on or after the Termination Date but prior to the expiration of the Release Period; provided, however, that your right to receive continued payment of your monthly Base Pay pursuant to this Section 2(a) shall terminate in its entirety on the last day in the month in which you secure full time employment that is comparable to your current employment with the Company, regardless of your actual start date.

(b) For purposes of this Agreement, “Base Pay” shall mean the your base pay (excluding overtime, bonuses, draws, commissions and other forms of additional compensation), at the rate in effect during the last regularly scheduled payroll period immediately preceding your termination date.

(c) Severance benefits will be in addition to final payment of wages earned, and a lump sum payment for any vacation earned but not used through your termination date.

Section 3. No Implied Employment Contract.

This Agreement shall not be deemed (i) to give you any right to be retained in the employ of the Company or (ii) to interfere with the right of the Company to discharge you at any time for any reason, with or without cause, which right is hereby reserved.

To indicate your acceptance of the retention and termination benefits specified in the Agreement, please return this signed Agreement to the Company.

Sincerely,
DANGER, INC.
By:	/s/ Matt Hershenson
Name:	Matt Hershenson

Accepted and Agreed:
/s/ Joe F. Britt, Jr.
Date:	7-23-01

EX-10.4

Exhibit 10.4

July 23, 2001

Matt Hershenson

Address

Address

Re: Severance Agreement of Danger, Inc. (the “Company”)

Dear Matt:

The Company is pleased to offer you the retention and severance benefits described in this letter agreement (the “Agreement”).

Section 1. Eligibility for Benefits.

The Company will grant you the severance benefits listed in Section 2 if you meet the all of the following eligibility factors:

(a) Your employment must have been terminated without “Cause” as set forth in Section 4.3(b) of the Restricted Stock Agreement (the “Stock Agreement”) between the Company and you dated September 22, 2000.

(b) You must remain on the job until your effective date of the termination as scheduled by the Company (the “Termination Date”). In addition, the right to receive severance benefits is specifically conditioned on satisfactory performance through the Termination Date, and no rights in the severance benefit shall vest until such date and only if satisfactory performance has been maintained.

(c) You must execute and deliver to the Company a waiver releasing the Company and its officers, directors, agents and employees, and each person in a control relationship with the Company from all losses and claims in connection with your

employment relationship in a form acceptable to the Company (the “General Release”). The General Release must be signed by you no earlier than the Termination Date of your employment and no later than the expiration of five calendar days from receipt of the release or such longer period allowed by law for you to consider and execute such release (the “Release Period”).

(d) You must have completed the exit procedures of the Company, including the return to the Company of all property and materials of the Company.

Section 2. Amount of Benefit.

The severance benefits granted pursuant to this Agreement, subject to Section 1, are as follows:

(a) You will receive from the Company continued payment of your monthly Base Pay as then in effect for a period of six months following the Termination Date, paid in accordance with the Company’s regular payroll practices, in addition to any benefits you may be entitled to under the Stock Agreement, as long as you execute a General Release on or after the Termination Date but prior to the expiration of the Release Period; provided, however, that your right to receive continued payment of your monthly Base Pay pursuant to this Section 2(a) shall terminate in its entirety on the last day in the month in which you secure full time employment that is comparable to your current employment with the Company, regardless of your actual start date.

(b) For purposes of this Agreement, “Base Pay” shall mean the your base pay (excluding overtime, bonuses, draws, commissions and other forms of additional compensation), at the rate in effect during the last regularly scheduled payroll period immediately preceding your termination date.

(c) Severance benefits will be in addition to final payment of wages earned, and a lump sum payment for any vacation earned but not used through your termination date.

Section 3. No Implied Employment Contract.

This Agreement shall not be deemed (i) to give you any right to be retained in the employ of the Company or (ii) to interfere with the right of the Company to discharge you at any time for any reason, with or without cause, which right is hereby reserved.

To indicate your acceptance of the retention and termination benefits specified in the Agreement, please return this signed Agreement to the Company.

Sincerely,
DANGER, INC.
By:	/s/ Joe F. Britt, Jr.
Name:	Joe F. Britt, Jr.

Accepted and Agreed:
/s/ Matt Hershenson
Date:	July 23, 2001

EX-10.5

EXHIBIT 10.5

June 27^th, 2002

Nancy Hilker

Address

Address

Dear Nancy:

On behalf of Danger, (the “Company”), I am pleased to offer you the position of Vice President Finance and Chief Financial Officer. We are very excited about you joining the company and look forward to your future success in this position.

The terms of your new position with the Company are as set forth below:

1. Position.

a. You will be working out of the Company’s headquarters in Palo Alto, California. You will report to the Company’s CEO.

b. You agree to the best of your ability and experience that you will at all times loyally and conscientiously perform all of the duties and obligations required of and from you pursuant to the express and implicit terms hereof, and to the reasonable satisfaction of the Company. During the term of your employment, you further agree that you will devote all of your business time and attention to the business of the Company, the Company will be entitled to all of the benefits and profits arising from or incident to all such work services and advice, you will not render commercial or professional services of any nature to any person or organization, whether or not for compensation, without the prior written consent of the Company’s Board of Directors, and you will not directly or indirectly engage or participate in any business that is competitive in any manner with the business of the Company. Nothing in this letter agreement will prevent you from accepting speaking or presentation engagements in exchange for honoraria or from serving on boards of charitable organizations, or from owning no more than one percent (1%) of the outstanding equity securities of a corporation whose stock is listed on a national stock exchange.

2. Start Date. Subject to fulfillment of any conditions imposed by this letter agreement, you will commence this new position with the Company on a date to be mutually agreed upon by you and the company.

3. Proof of Right to Work. For purposes of federal immigration law, you will be required to provide to the Company documentary evidence of your identity and eligibility for

employment in the United States. Such documentation must be provided to us within three (3) business days of your date of hire, or our employment relationship with you may be terminated.

4. Compensation.

a. Base Salary. You will be paid a monthly salary of $17,916.67, which is equivalent to $215,000 on an annualized basis. Your salary will be payable in equal biweekly installments pursuant to the Company’s regular payroll policy.

b. Bonus. You will be eligible to receive incentive bonuses in conjunction with your contributions to the successful achievement of significant company milestones. You will also be eligible for participation in any future executive bonus program that may be adopted and effective after your start date.

c. Performance Review. You will be eligible for a performance review on or about July 1 of the calendar year after the year in which your employment starts. Your base salary will be reviewed as part of such process.

5. Stock Options.

a. Initial Grant. In connection with the commencement of your employment, the Company will recommend that the Board of Directors grant you an option to purchase 600,189 shares of the Company’s Common Stock (“Shares”) with an exercise price equal to the fair market value on the date of the grant. These option shares will vest follows: 25% of the shares will vest one year from your start date and 1/36^th of the remaining shares will vest each month thereafter. Vesting will, of course, depend on your continued employment with the Company. The option will be an incentive stock option to the maximum extent allowed by the tax code and will be subject to the terms of the Company’s Year 2000 Plan and the Stock Option Agreement between you and the Company.

b. Subsequent Option Grants. Subject to the discretion of the Company’s Board of Directors, you may be eligible to receive additional grants of stock options or purchase rights from time to time in the future, on such terms and subject to such conditions as the Board of Directors shall determine as of the date of any such grant.

6. Benefits.

a. Insurance Benefits. The Company will provide you with standard medical, dental and vision insurance benefits.

b. Vacation. You will be entitled to 2 weeks paid vacation per year, pro-rated for the remainder of this calendar year.

7. Termination of Employment Following Change of Control

a. Accelerated Vesting. If your employment is terminated by the Company or its successor without Cause (as defined below) or you become subject to an Involuntary Termination (as defined below), within twelve (12) months following a Change of Control, you will receive 12 months of accelerated vesting under all stock options that you hold on the date of such termination.

b. Defined Terms.

i. The term “Cause” shall mean the commission of any act of fraud, embezzlement or dishonesty by you, any unauthorized use or disclosure by you of confidential information or trade secrets of the Company, or any other intentional misconduct by you adversely affecting the business or affairs of the Company in a material manner,

ii. The term “Involuntary Termination” shall mean your voluntary resignation following (A) a change in your position with the Company which materially reduces your duties and responsibilities or the level of management to which you report, (B) a reduction in your level of compensation (including base salary, fringe benefits and target bonus under any corporate-performance based incentive programs) by more than fifteen percent (15%); or (C) a relocation of your place of employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is effected by the Company without your consent.

iii. The term “Change of Control” shall mean (i) the Company’s merger or consolidation with another entity, or a series of related transactions, as a result of which the shareholders of the Company immediately prior to the transaction own less than fifty percent (50%) of the voting power of the entity surviving, or (ii) the sale of all or substantially all of the Company’s assets.

8. Confidential Information and Invention Assignment Agreement. Your acceptance of this offer and commencement of employment with the Company is contingent upon the execution, and delivery to an officer of the Company, of the Company’s Confidential Information and Invention Assignment Agreement, a copy of which is enclosed for your review and execution (the “Confidentiality Agreement”), prior to or on your Start Date.

9. Confidentiality of Terms. You agree to follow the Company’s strict policy that employees must not disclose, either directly or indirectly, any information, including any of the terms of this agreement, regarding salary, bonuses, or stock purchase or option

allocations to any person, including other employees of the Company; provided, however, that you may discuss such terms with members of your immediate family and any legal, tax or accounting specialists who provide you with individual legal, tax or accounting advice.

10. At-Will Employment. Your employment with the Company will be on an “at will” basis, meaning that either you or the Company may terminate your employment at any time for any reason or no reason, without further obligation or liability.

We are all delighted to be able to extend you this offer and look forward to working with you. To indicate your acceptance of the Company’s offer, please sign and date this letter in the space provided below and return it to me, along with a signed and dated copy of the Confidentiality Agreement. This letter, together with the Confidentiality Agreement, set forth the terms of your employment with the Company and supersede any prior representations or agreements, whether written or oral. This letter may not be modified or amended except by a written agreement, signed by the Company and by you.

Very truly yours,

Andrew E. Rubin

/s/ Andrew E. Rubin

President and CEO

ACCEPTED AND AGREED:

NANCY HILKER

/s/ Nancy Hilker

Signature

6/27/02

Date

EX-10.6

EXHIBIT 10.6

October 23^rd, 2002

James L. Isaacs

Address

Address

Dear James:

On behalf of Danger, (the “Company”), I am pleased to offer you the position of Vice President of Carrier Relations. We are very excited about you joining the company and look forward to your future success in this position.

The terms of your new position with the Company are as set forth below:

1. Position.

a. You will be working out of the Company’s headquarters in Palo Alto, California. You will report to the Company’s CEO.

b. You agree to the best of your ability and experience that you will at all times loyally and conscientiously perform all of the duties and obligations required of and from you pursuant to the express and implicit terms hereof, and to the reasonable satisfaction of the Company. During the term of your employment, you further agree that you will devote all of your business time and attention to the business of the Company, the Company will be entitled to all of the benefits and profits arising from or incident to all such work services and advice, you will not render commercial or professional services of any nature to any person or organization, whether or not for compensation, without the prior written consent of the Company’s Board of Directors, and you will not directly or indirectly engage or participate in any business that is competitive in any manner with the business of the Company. Nothing in this letter agreement will prevent you from accepting speaking or presentation engagements in exchange for honoraria or from serving on boards of charitable organizations, or from owning no more than one percent (1%) of the outstanding equity securities of a corporation whose stock is listed on a national stock exchange.

2. Start Date. Subject to fulfillment of any conditions imposed by this letter agreement, you will commence this new position with the Company on November 18^th 2002 or date TBD.

3. Proof of Right to Work. For purposes of federal immigration law, you will be required to provide to the Company documentary evidence of your identity and eligibility for employment in the United States. Such documentation must be provided to us within three (3) business days of your date of hire, or our employment relationship with you may be terminated.

4. Compensation.

a. Base Salary. You will be paid a monthly salary of $15,000, which is equivalent to $180,000 on an annualized basis. Your salary will be payable In equal biweekly installments pursuant to the Company’s regular payroll policy.

b. Bonus. You will be eligible to receive an incentive bonus up to an amount of $110,000 in conjunction with your contribution to the successful achievement of certain significant Company milestones to be mutually determined by you and your manager, it being understood that such milestones shall be quantitative in nature. Your manager will determine whether the relevant Company milestones have been achieved, and whether (or to what extent) your contribution to the achievement of such milestones warrants payment of the incentive bonus.

c. Performance Review. You will be eligible for a performance review on or about July 1 of the calendar year after the year in which your employment starts. Your base salary will be reviewed as part of such process.

5. Stock Options.

a. Initial Grant. In connection with the commencement of your employment, the Company will recommend that the Board of Directors grant you an option to purchase 400,000 shares of the Company’s Common Stock (“Shares”) with an exercise price equal to the fair market value on the date of the grant. These option shares will vest follows: 25% of the shares will vest one year from your start date and 1/36^th of the remaining shares will vest each month thereafter. Vesting will, of course, depend on your continued employment with the Company. The option will be an incentive stock option to the maximum extent allowed by the tax code and will be subject to the terms of the Company’s Year 2000 Plan and the Stock Option Agreement between you and the Company.

b. Subsequent Option Grants_,. Subject to the discretion of the Company’s Board of Directors, you may be eligible to receive additional grants of stock options or purchase rights from time to time in the future, on such terms and subject to such conditions as the Board of Directors shall determine as of the date of any such grant.

6. Benefits.

a. Insurance Benefits. The Company will provide you with standard medical, dental and vision insurance benefits.

b. Vacation. You will be entitled to 2 weeks paid vacation per year, pro-rated for the remainder of this calendar year.

7. Termination of Employment Following Change of Control

a. Accelerated Vesting. If your employment is terminated by the Company or its successor without Cause (as defined below) or you become subject to an Involuntary Termination (as defined below), within twelve (12) months following a Change of Control, you will receive 12 months of accelerated vesting under all stock options that you hold on the date of such termination.

b. Defined Terms.

i. The term “Cause” shall mean the commission of any act of fraud, embezzlement or dishonesty by you, any unauthorized use or disclosure by you of confidential information or trade secrets of the Company, or any other intentional misconduct by you adversely affecting the business or affairs of the Company in a material manner.

ii. The term “Involuntary Termination” shall mean your voluntary resignation following (A) a change in your position with the Company which materially reduces your duties and responsibilities or the level of management to which you report, (B) a reduction in your level of compensation (including base salary, fringe benefits and target bonus under any corporate-performance based incentive programs) by more than fifteen percent (15%); or (C) a relocation of your place of employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is effected by the Company without your consent.

iii. The term “Change of Control” shall mean (i) the Company’s merger or consolidation with another entity, or a series of related transactions, as a result of which the shareholders of the Company immediately prior to the transaction own less than fifty percent (50%) of the voting power of the entity surviving, or (ii) the sate of all or substantially all of the Company’s assets.

8. Confidential Information and Invention Assignment Agreement. Your acceptance of this offer and commencement of employment with the Company is contingent upon the execution, and delivery to an officer of the Company, of the Company’s Confidential Information and Invention Assignment Agreement, a copy of which is enclosed for your review and execution (the “Confidentiality Agreement”), prior to or on your Start Date.

9. Confidentiality of Terms. You agree to follow the Company’s strict policy that employees must not disclose, either directly or indirectly, any information, including any of the terms of this agreement, regarding salary, bonuses, or stock purchase or option allocations to any person, including other employees of the Company; provided, however, that you may discuss such terms with members of your immediate family and any legal, tax or accounting specialists who provide you with individual legal, tax or accounting advice.

10. At-Will Employment. Your employment with the Company will be on an “at will” basis, meaning that either you or the Company may terminate your employment at any time for any reason or no reason, without further obligation or liability.

We are all delighted to be able to extend you this offer and look forward to working with you. To indicate your acceptance of the Company’s offer, please sign and date this letter in the space provided below and return it to me, along with a signed and dated copy of the Confidentiality Agreement. This letter, together with the Confidentiality Agreement, set forth the terms of your employment with the Company and supersede any prior representations or agreements, whether written or oral. This letter may not be modified or amended except by a written agreement, signed by the Company and by you. This offer of employment is effective through October 28^th, 2002, after which it will expire.

Very truly yours,

Hank Nothhaft

/s/ Hank Nothhaft

CEO

ACCEPTED AND AGREED:

JAMES L. ISAACS

/s/ James L. Isaacs

Signature

10-25-2002

Date

EX-10.7

EXHIBIT 10.7

December 5, 2002

Leslie R. Hamilton

Address

Address

Dear Les:

On behalf of Danger, (the “Company”), I am pleased to offer you the position of SVP of Worldwide Operations. We are very excited about you joining the Company and look forward to your future success in this position.

The terms of your new position with the Company are as set forth below:

1. Position.

a. You will be working out of the Company’s headquarters in Palo Alto, California. You will report to the Company’s CEO.

b. You agree to the best of your ability and experience that you will at all times loyally and conscientiously perform all of the duties and obligations required of and from you pursuant to the express and implicit terms hereof, and to the reasonable satisfaction of the Company. During the term of your employment, you further agree that you will devote all of your business time and attention to the business of the Company, the Company will be entitled to all of the benefits and profits arising from or incident to all such work services and advice, you will not render commercial or professional services of any nature to any person or organization, whether or not for compensation, without the prior written consent of the Company’s Board of Directors, and you will not directly or indirectly engage or participate in any business that is competitive in any manner with the business of the Company. Nothing in this letter agreement will prevent you from accepting speaking or presentation

engagements in exchange for honoraria or from serving on boards of charitable organizations, or from owning no more than one percent (1%) of the outstanding equity securities of a corporation whose stock is listed on a national stock exchange.

2. Start Date. Subject to fulfillment of any conditions imposed by this letter agreement, you will commence this new position with the Company, on a date to be mutually agreed upon by you and the Company.

3. Proof of Right to Work. For purposes of federal immigration law, you will be required to provide to the Company documentary evidence of your identity and eligibility for employment in the United States. Such documentation must be provided to us within three (3) business days of your date of hire, or our employment relationship with you may be terminated.

4. Compensation.

a. Base Salary. You will be paid a monthly salary of $17,916.67, which is equivalent to $215,000 on an annualized basis. Your salary will be payable in equal biweekly installments pursuant to the Company’s regular payroll policy.

b. Signing Bonus. In connection with your employment, the Company is prepared to offer you the following signing bonus: $10,000. This signing bonus will be paid three months after the date that your employment commences. Any amounts received by will be reported as taxable income to you in the year received as required by applicable tax law. In the event that you voluntarily terminate your employment with the Company or are terminated for Cause (as defined below) before the end of the first year of employment, you agree to repay the Company 100% of the signing bonus by personal check or other negotiable instrument.

c. Bonus. You will be eligible to participate in any future executive bonus program that may be adopted and effective after your start date.

d. Relocation. The Company will reimburse you up to a maximum amount of $20,000 for your actual and documented costs of relocating to the San Francisco Bay Area, including moving expenses and closing costs on the purchase of a new primary residence (“Relocation Expenses”). In addition, the Company will reimburse your reasonable commuting and accommodation expenses for a three month transition period in accordance with the Company’s expense reimbursement policy. Amounts received by you in connection with such relocation reimbursement will be reported as taxable income to you in the year received as required by applicable tax law. In the event that you voluntarily terminate your employment with the Company or are terminated with Cause (as defined below) prior to the date that is twelve (12) months from the date your employment commences, you agree to repay the Company 100% of the amounts paid to you as reimbursement for Relocation Expenses by personal check or other negotiable instrument.

e. Performance Review. You will be eligible for a performance review on or about July 1 of the calendar year after the year in which your employment starts. Your base salary will be reviewed as part of such process.

5. Stock Options.

a. Initial Grant. In connection with the commencement of your employment, the Company will recommend that the Board of Directors grant you an option to purchase 400,000 shares of the Company’s Common Stock (“Shares”) with an exercise price equal to the fair market value on the date of the grant. These option shares will vest follows: 25% of the shares will vest one year from your start date and 1/36^th of the remaining shares will vest each month thereafter, Vesting will, of course, depend on your continued employment with the Company. The option will be an incentive stock option to the maximum extent allowed by the tax code and will be subject to the terms of the Company’s Year 2000 Plan and the Stock Option Agreement between you and the Company.

b. Subsequent Option Grants. Subject to the discretion of the Company’s Board of Directors, you may be

eligible to receive additional grants of stock options or purchase rights from time to time in the future, on such terms and subject to such conditions as the Board of Directors shall determine as of the date of any such grant.

6. Benefits.

a. Insurance Benefits. The Company will provide you with standard medical, dental and vision insurance benefits.

b. Vacation. You will be entitled to 3 weeks paid vacation per year.

7. Termination of Employment Following Change of Control.

a. Accelerated Vesting. If your employment is terminated by the Company or its successor without Cause (as defined below) or you become subject to an Involuntary Termination (as defined below), within twelve (12) months following a Change of Control, you will receive 12 months of accelerated vesting under all stock options that you hold on the date of such termination.

b. Defined Terms.

i. The term “Cause” shall mean the commission of any act of fraud, embezzlement or dishonesty by you, any unauthorized use or disclosure by you of confidential information or trade secrets of the Company, or any other intentional misconduct by you adversely affecting the business or affairs of the Company in a material manner.

ii. The term “Involuntary Termination” shall mean your voluntary resignation following (A) a change in your position with the Company which materially reduces your duties and responsibilities or the level of management to which you report, (B) a reduction in your level of compensation (including base salary, fringe benefits and target bonus under any corporate-performance based incentive programs) by more than fifteen percent

(15%); or (C) a relocation of your place of employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is effected by the Company without your consent.

iii. The term “Change of Control” shall mean (i) the Company’s merger or consolidation with another entity, or a series of related transactions, as a result of which the shareholders of the Company immediately prior to the transaction own less than fifty percent (50%) of the voting power of the entity surviving, or (ii) the sale of all or substantially all of the Company’s assets.

8. Confidential Information and Invention Assignment Agreement. Your acceptance of this offer and commencement of employment with the Company is contingent upon the execution, and delivery to an officer of the Company, of the Company’s Confidential Information and Invention Assignment Agreement, a copy of which is enclosed for your review and execution (the “Confidentiality Agreement”), prior to or on your Start Date.

9. Confidentiality of Terms. You agree to follow the Company’s strict policy that employees must not disclose, either directly or indirectly, any information, including any of the terms of this agreement, regarding salary, bonuses, or stock purchase or option allocations to any person, including other employees of the Company; provided, however, that you may discuss such terms with members of your immediate family and any legal, tax or accounting specialists who provide you with individual legal, tax or accounting advice.

10. At-Will Employment. Your employment with the Company will be on an “at will” basis, meaning that either you or the Company may terminate your employment at any time for any reason or no reason, without further obligation or liability.

We are all delighted to be able to extend you this offer and look forward to working with you. To indicate your acceptance of the Company’s offer, please sign and date this letter in the space provided below and return it to me, along with a signed and dated copy of the Confidentiality Agreement. This letter, together with the Confidentiality Agreement, set forth the terms of your employment with the Company and supersede any prior representations or agreements, whether written or oral. This letter may not be modified or amended except by a written agreement, signed by the Company and by you.

Very truly yours,

Henry R. Nothhaft

/s/ Henry R. Nothhaft

CEO

ACCEPTED AND AGREED:

LESLIE R. HAMILTON

/s/ Leslie R. Hamilton

Signature

December 20, 2002

Date

EX-10.8

EXHIBIT 10.8

DANGER.COM

August 19, 2003

Mark W. Fisher

Address

Address

Dear Mark:

On behalf of Danger, (the “Company”), I am pleased to offer you the position of SVP Business Development & Marketing. We are very excited about you joining the company and look forward to your future success in this position.

The terms of your new position with the Company are as set forth below:

1. Position.

a. You will be working out of the Company’s headquarters in Palo Alto, California. You will report to the Company’s Chief Executive Officer.

b. You agree to the best of your ability and experience that you will at all times loyally and conscientiously perform all of the duties and obligations required of and from you pursuant to the express and implicit terms hereof, and to the reasonable satisfaction of the Company. During the term of your employment, you further agree that you will devote all of your business time and attention to the business of the Company, the Company will be entitled to all of the benefits and profits arising from or incident to all such work services and advice, you will not render commercial or professional services of any nature to any person or organization, whether or not for compensation, without the prior written consent of the Company’s Board of Directors, and you will not directly or indirectly engage or participate in any business that is competitive in any manner with the business of the Company. Nothing in this letter agreement will prevent you from accepting speaking or presentation engagements in exchange for honoraria or from serving on boards of charitable organizations, or from owning no more than one percent (1%) of the outstanding equity securities of a corporation whose stock is listed on a national stock exchange.

2. Start Date. Subject to fulfillment of any conditions imposed by this letter agreement, you will commence this new position with the Company on August 25, 2003.

3. Proof of Right to Work. For purposes of federal immigration law, you will be required to provide to the Company documentary evidence of your identity and eligibility for employment in the United States. Such documentation must be provided to us within three (3) business days of your date of hire, or our employment relationship with you may be terminated.

4. Compensation.

a. Base Salary. You will be paid a monthly salary of $17,916.67, which is equivalent to $215,000 on an annualized basis. Your salary will be payable in equal biweekly installments pursuant to the Company’s regular payroll policy.

5. Stock Options.

a. Initial Grant. In connection with the commencement of your employment, the Company will recommend that the Board of Directors grant you an option to purchase 350,000 shares of the Company’s Common Stock (“Shares”) with an exercise price equal to the fair market value on the date of the grant. These option shares will vest follows: 25% of the shares will vest one year from your start date and 1/36^th of the remaining shares will vest each month thereafter. Vesting will, of course, depend on your continued employment with the Company. The option will be an incentive stock option to the maximum extent allowed by the tax code and will be subject to the terms of the Company’s Year 2000 Plan and the Stock Option Agreement between you and the Company.

b. Subsequent Option Grants. Subject to the discretion of the Company’s Board of Directors, you may be eligible to receive additional grants of stock options or purchase rights from time to time in the future, on such terms and subject to such conditions as the Board of Directors shall determine as of the date of any such grant.

6. Benefits.

a. Insurance Benefits. The Company will provide you with its standard medical, dental and vision insurance benefits.

b. Paid Time Off. You will be entitled to 15 days paid time off per year, pro-rated for the remainder of this calendar year.

7. Termination of Employment Following Change of Control.

a. Accelerated Vesting. If your employment is terminated by the Company or its successor without Cause (as defined below) or you become subject to an Involuntary Termination (as defined below), within twelve (12) months following a Change of Control, you will receive 12 months of accelerated vesting under all stock options that you hold on the date of such termination.

b. Defined Terms.

i. The term “Cause” shall mean the commission of any act of fraud, embezzlement or dishonesty by you, any unauthorized use or disclosure by you of confidential information or trade secrets of the Company, or any other intentional misconduct by you adversely affecting the business or affairs of the Company in a material manner.

2.

ii. The term “Involuntary Termination” shall mean your voluntary resignation following (A) a change in your position with the Company which materially reduces your duties and responsibilities or the level of management to which you report, (B) a reduction in your level of compensation (including base salary, fringe benefits and target bonus under any corporate-performance based incentive programs) by more than fifteen percent (15%); or (C) a relocation of your place of employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is effected by the Company without your consent.

iii. The term “Change of Control” shall mean (i) the Company’s merger or consolidation with another entity, or a series of related transactions, as a result of which the shareholders of the Company immediately prior to the transaction own less than fifty percent (50%) of the voting power of the entity surviving, or (ii) the sale of all or substantially all of the Company’s assets.

8. Confidential Information and Invention Assignment Agreement. Your acceptance of this offer and commencement of employment with the Company is contingent upon the execution, and delivery to an officer of the Company, of the Company’s Confidential Information and Invention Assignment Agreement, a copy of which is enclosed for your review and execution (the “Confidentiality Agreement”), prior to or on your Start Date.

9. Confidentiality of Terms. You agree to follow the Company’s strict policy that employees must not disclose, either directly or indirectly, any information, including any of the terms of this agreement, regarding salary, bonuses, or stock purchase or option allocations to any person, including other employees of the Company; provided, however, that you may discuss such terms with members of your immediate family and any legal, tax or accounting specialists who provide you with individual legal, tax or accounting advice.

10. At-Will Employment. Your employment with the Company will be on an “at will” basis, meaning that either you or the Company may terminate your employment at any time for any reason or no reason, without further obligation or liability.

We are all delighted to be able to extend you this offer and look forward to working with you. Please note that this offer is contingent upon the Company’s completion of a successful reference check. To indicate your acceptance of the Company’s offer, please sign and date this letter in the space provided below and return it to me, along with a signed and dated copy of the Confidentiality Agreement. This letter, together with the Confidentiality Agreement, set forth the terms of your employment with the Company and supersede any prior representations or agreements, whether written or oral. This letter may not be modified or amended except by a written agreement, signed by the Company and by you.

Very truly yours,

Henry R. Nothhaft

/s/ Henry R. Nothhaft

CEO

ACCEPTED AND AGREED:

MARK W. FISHER

/s/ Mark W. Fisher

Signature

8/20/03

Date

3.

EX-10.9

EXHIBIT 10.9

January 3, 2005

Donn Dobkin

Address

Address

Dear Donn:

On behalf of Danger, (the “Company”), I am pleased to offer you the position of Vice President, Service Operations. We are very excited about you joining the Company and look forward to your future success in this position.

The terms of your new position with the Company are as set forth below:

1. Position.

a. You will be working out of the Company’s headquarters in Palo Alto, California. You will report to the Company’s Senior Vice President, Engineering and Operations.

b. You agree to the best of your ability and experience that you will at all times loyally and conscientiously perform all of the duties and obligations required of and from you pursuant to the express and implicit terms hereof, and to the reasonable satisfaction of the Company. During the term of your employment, you further agree that you will devote all of your business time and attention to the business of the Company, the Company will be entitled to all of the benefits and profits arising from or incident to all such work services and advice, you will not render commercial or professional services of any nature to any person or organization, whether or not for compensation, without the prior written consent of the Company’s Board of Directors, and you will not directly or indirectly engage or participate in any business that is competitive in any manner with the business of the Company. Nothing in this letter agreement will prevent you from accepting speaking or presentation engagements in exchange for honoraria or from serving on boards of charitable organizations, or from owning no more than one percent (1%) of the outstanding equity securities of a corporation whose stock is listed on a national stock exchange.

2. Start Date. Subject to fulfillment of any conditions imposed by this letter agreement, you will commence this new position with the Company on January 3, 2005.

3. Proof of Right to Work. For purposes of federal immigration law, you will be required to provide to the Company documentary evidence of your identity and eligibility for employment in the United States. Such documentation must be provided to us within three (3) business days of your date of hire, or our employment relationship with you may be terminated.

4. Base Salary. You will be paid a monthly salary of $14,553.33, which is equivalent to $175,000 on an annualized basis. Your salary will be payable in equal biweekly installments pursuant to the Company’s regular payroll policy.

5. Stock Options.

a. Initial Grant. In connection with the commencement of your employment, the Company will recommend that the Board of Directors grant you an option to purchase 200,000 shares of the Company’s Common Stock (“Shares”) with an exercise price equal to the fair market value on the date of the grant. These option shares will vest follows: 25% of the shares will vest one year from your start date and 1/36^th of the remaining shares will vest each month thereafter. Vesting will, of course, depend on your continued employment with the Company, The option will be an incentive stock option to the maximum extent allowed by the tax code and will be subject to the terms of the Company’s Year 2000 Plan and the Stock Option Agreement between you and the Company.

b. Subsequent Option Grants. Subject to the discretion of the Company’s Board of Directors, you may be eligible to receive additional grants of stock options or purchase rights from time to time in the future, on such terms and subject to such conditions as the Board of Directors shall determine as of the date of any such grant.

6. Benefits.

a. Insurance Benefits. The Company will provide you with its standard medical, dental, vision, life and LTD insurance benefits.

b. Paid Time Off. You will be entitled to 15 days paid time off per year, pro-rated for the remainder of this calendar year.

7. Confidential Information and Invention Assignment Agreement. Your acceptance of this offer and commencement of employment with the Company is contingent upon the execution, and delivery to an officer of the Company, of the Company’s Confidential Information and Invention Assignment Agreement, a copy of which is enclosed for your review and execution (the “Confidentiality Agreement”), prior to or on your Start Date.

8. Confidentiality of Terms. You agree to follow the Company’s strict policy that employees must not disclose, either directly or indirectly, any information, including any of the terms of this agreement, regarding salary, bonuses, or stock purchase or option allocations to any person, including other employees of the Company; provided, however, that you may discuss such terms with members of your immediate family and any legal, tax or accounting specialists who provide you with individual legal, tax or accounting advice.

9. At-Will Employment. Your employment with the Company will be on an “at will” basis, meaning that either you or the Company may terminate your employment at any time for any reason or no reason, without further obligation or liability.

2.

10. Reference Check. This offer is contingent upon the Company’s completion of a successful reference check.

We are all delighted to be able to extend you this offer and look forward to working with you. To indicate your acceptance of the Company’s offer, please sign and date this letter in the space provided below and return it to me, along with a signed and dated copy of the Confidentiality Agreement. This letter, together with the Confidentiality Agreement, set forth the terms of your employment with the Company and supersede any prior representations or agreements, whether written or oral. This letter may not be modified or amended except by a written agreement, signed by the CEO and by you.

Very truly yours,

Henry R. Nothhaft

/s/ Henry R. Nothhaft

CEO

ACCEPTED AND AGREED:

DONN DOBKIN

/s/ Donn Dobkin

Signature

1/3/04

Date

3.

EX-10.12

EXHIBIT 10.12

DANGER RESEARCH, INC.

RESTRICTED STOCK AGREEMENT

TABLE OF CONTENTS

			PAGE
I.	SECURITIES LAW COMPLIANCE		1
	1.1	Restricted Securities	1
	1.2	Disposition of Shares	2
	1.3	Restrictive Legends	2
II.	SPECIAL TAX PROVISIONS		3
	2.1	Valuation of Common Stock	3
III.	TRANSFER RESTRICTIONS		3
	3.1	Definition of Owner	3
	3.2	Restriction on Transfer	3
	3.3	Transferee Obligations	3
	3.4	Market Stand-Off Provisions	4
IV.	REPURCHASE RIGHT		4
	4.1	Grant	4
	4.2	Exercise of the Repurchase Right	4
	4.3	Termination of the Repurchase Right	5
	4.4	Fractional Shares.	5
	4.5	Additional Shares or Substituted Securities	5
V.	RIGHT OF FIRST REFUSAL		6
	5.1	Grant	6
	5.2	Notice of Intended Disposition	6
	5.3	Exercise of Right	6
	5.4	Non-Exercise of Right	6
	5.5	Partial Exercise of Right	6
	5.6	Recapitalization	7
	5.7	Lapse	7
VI.	ESCROW		7
	6.1	Deposit	7
	6.2	Recapitalization	7
	6.3	Release/Surrender	8
VII.	MARITAL DISSOLUTION OR LEGAL SEPARATION		8

-i-

TABLE OF CONTENTS

(CONTINUED)

			PAGE
	7.1	Grant	8
	7.2	Notice of Decree or Agreement	9
	7.3	Exercise of the Special Purchase Right	9
	7.4	Lapse	9
VIII.	GENERAL PROVISIONS		9
	8.1	Assignment	9
	8.2	Definitions	10
	8.3	No Employment or Service Contract	10
	8.4	Notices	10
	8.5	No Waiver	10
	8.6	Cancellation of Shares	10
IX.	MISCELLANEOUS PROVISIONS		11
	9.1	Purchaser Undertaking	11
	9.2	Agreement is Amendment of the Grant Agreement	11
	9.3	Governing Law	11
	9.4	Counterparts	11
	9.5	Successors and Assigns	11
	9.6	Amendment and Waiver	11
	9.7	Arbitration	11

EXHIBIT A– ASSIGNMENT SEPARATE FROM CERTIFICATE

EXHIBIT B– SECTION 83(b) TAX ELECTION

-ii-

RESTRICTED STOCK AGREEMENT

THIS RESTRICTED STOCK AGREEMENT (this “Agreement”) is made as of this 22nd day of September, 2000, by and between Danger Research, Inc., a Delaware corporation (the “Company”), and Matthew J. Hershenson. (“Purchaser”).

WHEREAS, Purchaser has purchased 4,000,000 shares of the Company’s Common Stock (the “Shares”), at a purchase price of $0.0075 per share (the “Purchase Price”), or $30,000 in the aggregate pursuant to that certain Restricted Stock Purchase Agreement, dated March 10, 2000, by and between Purchaser and the Company (the “Grant Agreement”);

WHEREAS, the Company has entered into a Series A Preferred Stock Purchase Agreement (the “Series A Purchase Agreement”), of even date herewith, under which the Company has agreed to sell, to the investors listed on Schedule A thereto (the “Investors”), and the Investors have agreed to purchase, shares of the Series A Preferred Stock of the Company;

WHEREAS, execution and delivery of this Agreement is a condition to the obligations of the Investors under the Series A Purchase Agreement; and

WHEREAS, the purpose of this Agreement is to amend and supplement (and not to restate in its entirety) the Grant Agreement;

NOW THEREFORE, in consideration of the mutual promises and obligations set forth herein and in the Series A Purchase Agreement and the documents executed and delivered in connection therewith, the parties agree as follows:

I. SECURITIES LAW COMPLIANCE

1.1 Restricted Securities.

(a) Purchaser hereby confirms that Purchaser has been informed that the Shares are restricted securities under the Securities Act of 1933, as amended (“1933 Act”), and may not be resold or transferred unless the Shares are first registered under the federal securities laws or unless an exemption from such registration is available. Accordingly, Purchaser hereby acknowledges that Purchaser is prepared to hold the Shares for an indefinite period and that Purchaser is aware that Rule 144 of the Securities and Exchange Commission (“SEC”) issued under the 1933 Act is not presently available to exempt the sale of the Shares from the registration requirements of the 1933 Act.

(b) Upon the expiration of the ninety (90)-day period immediately following the date on which the Company first becomes subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Shares, to the extent vested under Article IV, may be sold (without registration) pursuant to the applicable requirements of Rule 144. If Purchaser is at the time of such sale an affiliate of the Company for purposes of Rule 144 or was such an affiliate during the preceding three (3) months, then the sale must comply with all the requirements of Rule 144 (including the volume limitation on the number of shares sold, the broker/market-maker sale requirement and the requisite notice to the SEC); however, the one year holding period requirement of the Rule will not be applicable. If Purchaser is not at the time of the sale an affiliate of the Company nor was such an affiliate during the preceding three (3) months, then none of the requirements of Rule 144 (other than the broker/market-maker sale requirement for Shares held for fewer than two (2) years following payment in cash of the Purchase Price therefor) will be applicable to the sale. The requirements of Rule 144 are subject to change at any time.

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(c) Should the Company not become subject to the reporting requirements of the Exchange Act, then Purchaser may, provided he is not at the time an affiliate of the Company (nor was such an affiliate during the preceding three (3) months), sell the Shares (without registration) pursuant to paragraph (k) of Rule 144 after the Shares have been held for a period of two (2) years following the payment in cash of the Purchase Price for such shares.

1.2 Disposition of Shares. Subject to the terms of this Agreement, Purchaser hereby agrees that Purchaser shall make no disposition of the Shares (other than a permitted transfer under paragraph 3.2) unless and until there is compliance with all of the following requirements:

(a) Purchaser shall have notified the Company of the proposed disposition and provided a written summary of the terms and conditions of the proposed disposition;

(b) Purchaser shall have complied with all requirements of this Agreement applicable to the disposition of the Shares;

(c) Purchaser shall have provided the Company with written assurances, in form and substance satisfactory to the Company, that (i) the proposed disposition does not require registration of the Shares under the 1933 Act or (ii) all appropriate action necessary for compliance with the registration requirements of the 1933 Act or of any exemption from registration available under the 1933 Act (including Rule 144) has been taken; and

(d) Purchaser shall have provided the Company with written assurances, in form and substance satisfactory to the Company, that the proposed disposition will not result in the contravention of any transfer restrictions applicable to the Shares.

The Company shall not be required (i) to transfer on its books any Shares which have been sold or transferred in violation of the provisions of this Article I nor (ii) to treat as the owner of the Shares, or otherwise to accord voting or dividend rights to, any transferee to whom the Shares have been transferred in contravention of this Agreement.

1.3 Restrictive Legends. In order to reflect the restrictions on disposition of the Shares, the stock certificates for the Shares have been endorsed with restrictive legends, including legends in substantially the form of one or more of the following legends:

(a) “The shares represented by this certificate have not been registered under the Securities Act of 1933, as amended. The shares may not be sold or offered for sale in the absence of (1) an effective registration statement for the shares under such Act, (2) a ‘no action’ letter of the SEC with respect to such sale or offer, or (3) satisfactory assurances to the Company that registration under such Act is not required with respect to such sale or offer.”

(b) “The shares represented by this certificate are unvested and accordingly may not be sold, assigned, transferred, encumbered, or in any manner disposed of except in conformity 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 and rights of first refusal to the Company (or its assignees) upon the sale, assignment, transfer, encumbrance or other disposition of the Company’s shares or upon termination of service with the Company. The Company will upon written request furnish a copy of such agreement to the holder hereof without charge.”

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II. SPECIAL TAX PROVISIONS

2.1 Valuation of Common Stock. Purchaser understands that the price paid for the Shares has been valued by the Board of Directors and that the Company believes this valuation represents a fair attempt at reaching an accurate appraisal of their worth; Purchaser understands, however, that the Company can give no assurances that such price is in fact the fair market value of the Shares and that it is possible that, with the benefit of hindsight, the Internal Revenue Service would successfully assert that the value of the Shares on the date of purchase is substantially greater than so determined.

If the Internal Revenue Service were to succeed in a tax determination that the Shares received had value greater than that upon which the transaction was based, the additional value would constitute ordinary income as of the date of its receipt. The additional taxes (and interest) due would be payable by Purchaser, and there is no provision for the Company to reimburse him for that tax liability, and Purchaser assumes all responsibility for such potential tax liability. In the event that such additional value would represent more than twenty-five percent (25%) of Purchaser’s gross income for the year in which the value of the Shares was taxable, the Internal Revenue Service would have six years from the due date for filing the return (or the actual filing date of the return if filed thereafter) within which to assess Purchaser the additional tax and interest which would then be due.

The Company would have the benefit, in any such transaction, if a determination was made prior to the three year statute of limitations period affecting the Company, of an increase in its deduction for compensation paid, which would offset its operating profits, or, if not profitable, would create net operating loss carry forward arising from operations in that year.

III. TRANSFER RESTRICTIONS

3.1 Definition of Owner. For purposes of this Agreement, the term “Owner” shall include the Purchaser and all subsequent holders of the Shares who derive their chain of ownership through a permitted transfer from the Purchaser in accordance with paragraph 3.2.

3.2 Restriction on Transfer. Owner shall not transfer, assign, encumber or otherwise dispose of any of the Shares which are subject to the Company’s Repurchase Rights in this Agreement. In addition, Shares which are released from the Repurchase Rights shall not be transferred, assigned, encumbered or otherwise made the subject of disposition in contravention of the Company’s First Refusal Right under Article V or as otherwise limited herein. Such restrictions on transfer, however, shall not be applicable to (i) a gratuitous transfer of the Shares made to the Owner’s spouse or issue, including adopted children, or to a trust for the exclusive benefit of the Owner or the Owner’s spouse or issue, provided and only if the Owner obtains the Company’s prior written consent to such transfer and such transferee agrees to be bound by the terms of this Agreement, (ii) a transfer of title to the Shares effected pursuant to the Owner’s will or the laws of intestate succession or (iii) a transfer to the Company in pledge as security for any purchase-money indebtedness incurred by Purchaser in connection with the acquisition of the Shares.

3.3 Transferee Obligations. Each person (other than the Company) to whom the Shares are transferred by means of one of the permitted transfers specified in paragraph 3.2 must, as a condition precedent to the validity of such transfer, acknowledge in writing to the Company that such person is bound by the provisions of this Agreement and that the transferred shares are subject to (i) both the Company’s Repurchase Rights and the Company’s First Refusal Right granted hereunder and (ii) the market stand-off provisions of paragraph 3.4, to the same extent such Shares would be so subject if retained by the Purchaser.

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3.4 Market Stand-Off Provisions.

(a) In connection with the first or second underwritten public offering by the Company of its equity securities pursuant to an effective registration statement filed under the 1933 Act, Owner shall not sell, make any short sale of, loan, hypothecate, pledge, grant any option for the purchase of, or otherwise dispose or transfer for value or otherwise agree to engage in any of the foregoing transactions with respect to, any Shares without the prior written consent of the Company or its underwriters. Such limitations shall be in effect for such period of time from and after the effective date of such registration statement as may be requested by the Company or such underwriters; provided, however, that in no event shall such period exceed one hundred-eighty (180) days and ninety (90) days for the first secondary public offering by the Company.

(b) Owner shall be subject to the market stand-off provisions of this paragraph 3.4 provided and only if the executive officers and directors of the Company are also subject to similar arrangements.

(c) In the event of any stock dividend, stock split, recapitalization or other change affecting the Company’s outstanding Common Stock effected without receipt of consideration, then any new, substituted or additional securities distributed with respect to the Shares shall be immediately subject to the provisions of this paragraph 3.4, to the same extent the Shares are at such time covered by such provisions.

(d) In order to enforce the limitations of this paragraph 3.4, the Company may impose stop-transfer instructions with respect to the Shares until the end of the applicable stand-off period.

IV. REPURCHASE RIGHT

4.1 Grant. The Company (or its assignees) is hereby granted the right (the “Repurchase Right”), exercisable at any time during the sixty (60)-day period following the date the Purchaser ceases for any reason to remain in service to the Company (“Service”) or (if later) during the sixty (60)-day period following the execution date of this Agreement, to repurchase at the Purchase Price all or (at the discretion of the Company) any portion of the Shares in which the Purchaser has not acquired a vested interest in accordance with the vesting provisions of this Article IV (such shares to be hereinafter called the “Unvested Shares”), For purposes of this Agreement, the Purchaser shall be deemed to remain in Service for so long as the Purchaser continues to render services to the Company or parent, subsidiary or successor corporation as an employee, consultant or director. Purchaser agrees that any Shares subject to the Repurchase Right shall be held in escrow by the Company until the Shares become vested.

4.2 Exercise of the Repurchase Right. The Repurchase Right shall be exercisable by written notice delivered to the Owner of the Unvested Shares prior to the expiration of the applicable sixty (60)-day period specified in paragraph 4.1. The notice shall indicate the number of Unvested Shares to be repurchased and the date on which the repurchase is to be effected, such date to be not more than thirty (30) days after the date of notice. To the extent one or more certificates representing Unvested Shares may have been previously delivered out of escrow to the Owner, then Owner shall, prior to the close of business on the date specified for the repurchase, deliver to the Secretary of the Company the certificates representing the Unvested Shares to be repurchased, each certificate to be properly endorsed for transfer. The Company shall, concurrently with the receipt of such stock certificates (either from escrow in accordance or from Owner as herein provided), pay to Owner in cash or cash equivalents (including the cancellation of any purchase-money indebtedness), an amount equal to the per Share Purchase Price previously paid for the Unvested Shares which are to be repurchased.

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4.3 Termination of the Repurchase Right. The Repurchase Right shall terminate with respect to any Unvested Shares for which it is not timely exercised under paragraph 4.2. In addition, the Repurchase Right as to certain Unvested Shares shall terminate, and cease to be exercisable, solely to the extent set forth below, on the earliest to occur of (i) an Acceleration Event of the Purchaser as described in Section 4.3(b) below or (ii) with respect to any and all Shares in which the Purchaser vests in accordance with the schedule set forth in Section 4.3(a) below. Accordingly, as, and provided that, the Purchaser continues in continuous Service, as defined above, or upon the occurrence of an Acceleration Event, the Purchaser shall acquire a vested interest in, and the Repurchase Right as to certain Unvested- Shares, solely to the extent set forth below, shall lapse with respect to, the Shares in accordance with the following provisions:

(a) The Purchaser shall have a vested interest in 1,000,000 shares on the date hereof. With respect to the remaining 3,000,000 Shares, the Purchaser shall acquire a vested interest in, and the Repurchase Right shall lapse in thirty-six (36) equal and continuous monthly installments for each monthly period of continuous Service after September 22, 2000, and for the thirty-six (36) months following September 22, 2000, such that Purchaser shall be fully vested in all Shares after thirty-six (36) months of continuous Service completed by the Purchaser following September 22, 2000; and

(b) So long as the Company’s Repurchase Right remains in effect, 1,000,000 (or such lesser amount of Unvested Shares remaining) of the then Unvested Shares of the Purchaser shall vest immediately and the Repurchase Right shall lapse with respect to such number of the Unvested Shares if the Purchaser is terminated by the Company, actually or constructively, without “Cause” (an “Acceleration Event”). For purposes of this Agreement, the term “Cause” shall mean any one of the following: (i) gross negligence or the repeated failure of Purchaser, following the receipt of written notice from the Board of its dissatisfaction with the Purchaser’s performance, to perform his duties and responsibilities to the reasonable satisfaction of the Board; (ii) any breach by Purchaser of his fiduciary duties to the Company or any material term. of this Agreement; or (iii) the conviction of Purchaser for a felony. For purposes of this Agreement, any act or acts or omission or omissions by Purchaser that have a material adverse effect on the Company’s operations, prospects, reputation or business shall be deemed to be a breach of his duties and responsibilities to the Company.

(c) All Shares as to which the Repurchase Right lapses shall, however, continue to be subject to (i) the First Refusal Right until the lapse of such First Refusal Right, (ii) the market stand-off provisions of paragraph 3.4 and (iii) the Special Purchase Rights set forth under Article VII.

4.4 Fractional Shares. No fractional shares shall be repurchased by the Company. Accordingly, should the Repurchase Right extend to a fractional share (in accordance with the vesting computation provisions of paragraphs 4.3 and 4.6) at the time the Purchaser ceases Service or pursuant hereto, then such fractional share shall be added to any fractional share in which the Purchaser is at such time vested in order to make one whole vested share no longer subject to the Repurchase Right.

4.5 Additional Shares or Substituted Securities. In the event of any stock dividend, stock split, recapitalization or other change affecting the Company’s outstanding Common Stock as a class effected without receipt of consideration, then any new, substituted or additional securities or other property (including money paid other than as a regular cash dividend) which is by reason of any such transaction distributed with respect to-the Shares shall be immediately subject to the Repurchase Right, but only to the extent the Shares are at the time covered by such right. Appropriate adjustments to reflect the distribution of such securities or property shall be made to the number of Shares at the time subject to the Repurchase Right hereunder and to the price per share to be paid upon the exercise of the Repurchase Right in order to reflect the effect of any such transaction upon the Company’s capital structure; provided, however, that the aggregate Purchase Price shall remain the same.

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V. RIGHT OF FIRST REFUSAL

5.1 Grant. The Company is hereby granted the right of first refusal (the “First Refusal Right”), exercisable in connection with any proposed transfer of the Shares. For purposes of this Article V, the term “transfer” shall include any sale, assignment, pledge, encumbrance or other disposition for value of the Shares intended to be made by the Owner, but shall exclude any of the permitted transfers under paragraph 3.2.

5.2 Notice of Intended Disposition. In the event the Owner desires to accept a bona fide third-party offer for any or all of the Shares (the shares subject to such offer to be hereinafter called the “Target Shares”), Owner shall promptly (i) deliver to the Corporate Secretary of the Company written notice (the “Disposition Notice”) of the terms and conditions of the offer, including the purchase price and the identity of the third-party offeror and (ii) provide satisfactory proof that the disposition of the Target Shares to such third-party offeror would not be in contravention of the provisions set forth in Articles I and III of this Agreement.

5.3 Exercise of Right. The Company (or its assignees) shall, for a period of twenty-five (25) days following receipt of the Disposition Notice, have the right to repurchase any or all of the Target Shares specified in the Disposition Notice upon substantially the same terms and conditions specified therein. Such right shall be exercisable by delivery of written notice (the “Exercise Notice”) to Owner prior to the expiration of the twenty-five (25) day exercise period. If such right is exercised with respect to all the Target Shares specified in the Disposition Notice, then the Company (or its assignees) shall effect the repurchase of the Target Shares, including payment of the purchase price, not more than five (5) business days after delivery of the Exercise Notice; and at such time Owner shall deliver to the Company the certificates representing the Target Shares to be repurchased, each certificate to be properly endorsed for transfer. To the extent any of the Target Shares are at the time held in escrow under Article VI, the certificates for such shares shall automatically be released from escrow and delivered to the Company for purchase.

5.4 Non-Exercise of Right. In the event the Exercise Notice is not given to Owner within twenty-five (25) days following the date of the Company’s receipt of the Disposition Notice, Owner shall have a period of thirty (30) days thereafter in which to sell or otherwise dispose of the Target Shares to the third-party offeror identified in the Disposition Notice upon terms and conditions (including the purchase price) no more favorable to such third-party offeror than those specified in the Disposition Notice; provided, however, that any such sale or disposition must not be effected in contravention of the provisions of Article I of this Agreement. To the extent any of the Target Shares are at the time held in escrow under Article VI, the certificates for such shares shall automatically be released from escrow and surrendered to the Owner. The third-party offeror shall acquire the Target Shares free and clear of the Company’s Repurchase Right under Article IV, but the acquired shares shall remain subject to (i) the securities law restrictions under Article (ii) the market stand-off provisions of paragraph 3.4, (iii) the Company’s First Refusal Rights hereunder and (iv) Article VII.

5.5 Partial Exercise of Right. In the event the Company (or its assignees) makes a timely exercise of the First Refusal Right with respect to a portion, but not all, of the Target Shares specified in the Disposition Notice, Owner shall have the option, exercisable by written notice to the Company delivered within thirty (30) days after the date of the Disposition Notice, to effect the sale of the Target Shares pursuant to one of the following alternatives:

(a) sale or other disposition of all the Target Shares to the third-party offeror identified in the Disposition Notice, but in full compliance with the requirements of paragraph 5.4, as if the Company did not exercise the First Refusal Right hereunder; or

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(b) sale to the Company (or its assignees) of the portion of the Target Shares which the Company (or its assignees) has elected to purchase, such sale to be effected in substantial conformity with the provisions of paragraph 5.3.

Failure of Owner to deliver timely notification to the Company under this paragraph 5.5 shall be deemed to be an election by Owner to sell the Target Shares pursuant to alternative (a) above.

5.6 Recapitalization. In the event of any stock dividend, stock split, recapitalization. or other transaction affecting the Company’s outstanding Common Stock as a class effected without receipt of consideration, then any new, substituted or additional securities or other property which is by reason of such transaction distributed with respect to the Shares shall be immediately subject to the Company’s First Refusal Right hereunder, but only to the extent the Shares are at the time covered by such right.

5.7 Lapse. The First Refusal Right under this Article V shall remain in effect under all circumstances but shall lapse and cease to have effect upon the earliest to occur of (i) the first date on which shares of the Company’s Common Stock are held of record by more than five hundred (500) persons, (ii) a determination is made by the Company’s Board of Directors that a public market exists for the outstanding shares of the Company’s Common Stock, (iii) an underwritten public offering pursuant to an effective registration statement under the 1933 Act or (iv) in the event of either of the following transactions (each a “Corporate Transaction”): (x) a merger or consolidation of the Company, in which the stockholders of the Company do not control fifty percent (50%) or more of the total voting power of the surviving entity (other than a mere reincorporation merger) or (y) the sale, transfer or other disposition of all or substantially all of the Company’s assets in liquidation or dissolution of the Company. However, the market stand-off provisions of paragraph 3.4 shall continue to remain in full force and effect following the lapse of the First Refusal Right hereunder.

VI. ESCROW

6.1 Deposit. The certificates for any Unvested Shares have been deposited in escrow with the Company to be held in accordance with the provisions of this Article VI. Each deposited certificate is accompanied by a duly executed Assignment Separate from Certificate in the form of Exhibit A. The deposited certificates, together with any other assets or securities from time to time deposited with the Company pursuant to the requirements of this Agreement, shall remain in escrow until such time or times as the certificates (or other assets and securities) are to be released or otherwise surrendered for cancellation in accordance with paragraph 6.3. Upon delivery of the certificates (or other assets and securities) to the Company, the Owner shall be issued an instrument of deposit acknowledging the number of Unvested Shares (or other assets and securities) delivered in escrow to the Company.

6.2 Recapitalization. All regular cash dividends on the Unvested Shares (or other securities at the time held in escrow) shall be paid directly to the Owner and shall not be held in escrow. However, in the event of any stock dividend, stock split, recapitalization or other change affecting the Company’s outstanding Common Stock as a class effected without receipt of consideration or in the event of a Corporate Transaction, any new, substituted or additional securities or other property which is by reason of such transaction distributed with respect to the Unvested Shares shall be immediately delivered to the Company to be held in escrow under this Article VI, but only to the extent the Unvested Shares are at the time subject to the escrow requirements of paragraph 6.1.

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6.3 Release/Surrender. The Unvested Shares, together with any other assets or securities held in escrow hereunder, shall be subject to the following terms and conditions relating to their release from escrow or their surrender to the Company for repurchase and cancellation:

(a) Should the Company (or its assignees) elect to exercise the Repurchase Right under Article IV with respect to any Unvested Shares, then the escrowed certificates for such Unvested Shares (together with any other assets or securities issued with respect thereto) shall be delivered to the Company, concurrently with the payment to the Owner, in cash or cash equivalent (including the cancellation of any purchase-money indebtedness), of an amount equal to the aggregate Purchase Price for such Unvested Shares, and the Owner shall cease to have any further rights or claims with respect to such Unvested Shares (or other assets or securities attributable to such Unvested Shares).

(b) Should the Company (or its assignees) elect to exercise its First Refusal Right under Article V with respect to any vested Target Shares held at the time in escrow hereunder, then the escrowed certificates for such Target Shares (together with any other assets or securities attributable thereto) shall, concurrently with the payment of the paragraph 5.3 purchase price for such Target Shares to the Owner, be surrendered to the Company, and the Owner shall cease to have any further rights or claims with respect to such Target Shares (or other assets or securities).

(c) Should the Company (or its assignees) elect not to exercise its First Refusal Right under Article V with respect to any Target Shares held at the time in escrow hereunder, then the escrowed certificates for such Target Shares (together with any other assets or securities attributable thereto) shall be surrendered to the Owner for disposition in accordance with the provisions of paragraph 5.4.

(d) As the interest of the Owner in the Unvested Shares (or any other assets or securities attributable thereto) vests in accordance with the provisions of Article IV, the certificates for such vested shares (as well as all other vested assets and securities) shall be released from escrow and delivered to the Owner in accordance with the following schedule:

(1) Upon the Purchaser’s cessation of Service, any escrowed Shares (or other assets or securities) in which the Purchaser is at the time vested shall be promptly released from escrow.

(2) Upon any earlier termination of the Company’s Repurchase Right in accordance with the applicable provisions of Article IV, the Shares (or other assets or securities) at the time held in escrow hereunder shall promptly be released to the Owner as fully-vested shares or other property.

(3) All Shares (or other assets or securities) released from escrow in accordance with the provisions of subparagraph (2) above shall nevertheless remain subject to (i) the Company’s First Refusal Right under Article V until such right lapses pursuant to paragraph 5.7 and Article II and (ii) the market stand-off provisions of paragraph 3.4 until such provisions terminate in accordance therewith.

VII. MARITAL DISSOLUTION OR LEGAL SEPARATION

7.1 Grant. Notwithstanding anything in this Agreement to the contrary, in connection with the dissolution of Owner’s marriage or the legal separation of Owner and Owner’s spouse, the Company shall have the right (the “Special Purchase Right”) to purchase from Purchaser’s spouse, in accordance with the provisions of this Article VII, all or any portion of the Shares which would otherwise be awarded to such spouse in settlement of any community property or other marital property rights such spouse may have in such shares.

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7.2 Notice of Decree or Agreement. Owner shall promptly provide the Company with written notice (the “Dissolution Notice”) of (i) the entry of any judicial decree or order resolving the property rights of Owner and Owner’s spouse in connection with their marital dissolution or legal separation or (ii) the execution of any contract or agreement relating to the distribution or division of such property rights. The Dissolution Notice shall be accompanied by a copy of the actual decree or order of dissolution or contract or agreement between Owner and Owner’s spouse which provides for the award to the spouse of one or more Shares in settlement of any community property or other marital property rights such spouse may have in such shares.

7.3 Exercise of the Special Purchase Right. The Special Purchase Right shall be exercisable by delivery of written notice (the “Purchase Notice”) to Owner and Owner’s spouse within forty-five (45) days after the Company’s receipt of the Dissolution Notice. The Purchase Notice shall indicate the number of Shares to be purchased by the Company, the date such purchase is to be effected (such date to be not less than five (5) business days, nor more than fifteen (15) business days, after the date of the Purchase Notice) and the fair market value to be paid for such Shares. Owner (or Owner’s spouse, to the extent such spouse has physical possession of the Shares) shall, prior to the close of business on the date specified for the purchase, deliver to the Company the certificates representing the shares to be purchased. The Company shall, concurrently with the receipt of the stock certificates, pay to Owner’s spouse (in cash or cash equivalents) an amount equal to the fair market value specified for such shares in the Purchase Notice.

If Owner’s spouse does not agree with the fair market value specified for the Shares in the Purchase Notice, then the spouse shall promptly notify the Company in writing of such disagreement and the fair market value of such Shares shall thereupon be determined by an appraiser of recognized standing selected by the Company and the spouse. If they cannot agree on an appraiser within fifteen (15) days after the date of the Purchase Notice, each shall select an appraiser of recognized standing, and the two (2) appraisers shall designate a third appraiser of recognized standing whose appraisal shall be determinative of such value. The cost of the appraisal shall be shared equally by the Company and Owner’s spouse. The closing shall then be held on the fifteenth (15th) business day following the completion of such appraisal; provided, however, that if the appraised value is more than twenty-five percent (25%) greater than the fair market value specified for the Shares in the Purchase Notice, the Company shall have the right, exercisable prior to the expiration of such fifteen (15) business-day period, to rescind the exercise of the Special Purchase Right and thereby revoke its election to purchase the Shares awarded to the spouse.

7.4 Lapse. The Special Purchase Right shall lapse upon the earlier to occur of (i) the lapse of the First Refusal Right or (ii) the expiration of the exercise period specified in this Article VII, to the extent the Special Purchase Right is not timely exercised in accordance with such paragraph.

VIII. GENERAL PROVISIONS

8.1 Assignment. The Company may assign its Repurchase Right under Article IV and/or its First Refusal Right under Article V and/or its Special Purchase Rights under Article VII to any person or entity selected by the Company’s Board of Directors, including (without limitation) one or more stockholders of the Company.

If the assignee is other than a parent or subsidiary corporation of the Company, then such assignee must make a cash payment to the Company, upon the assignment of the Repurchase Right, in an

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amount equal to the excess (if any) of (i) the fair market value of the Unvested Shares at the time subject to the assigned Repurchase Right over (ii) the aggregate repurchase price payable for Unvested Shares thereunder.

8.2 Definitions. For purposes of this Agreement, the following provisions shall be applicable in determining the parent and subsidiary corporations of the Company:

(a) Any corporation (other than the Company) in an unbroken chain of corporations ending with the Company shall be considered to be a parent corporation of the Company, provided each such corporation in the unbroken chain (other than the Company) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

(b) Each corporation (other than the Company) in an unbroken chain of corporations beginning with the Company shall be considered to be a subsidiary of the Company, provided each such corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

8.3 No Employment or Service Contract. Nothing contained in this Agreement shall confer upon the Purchaser any right to continue in the Service of the Company (or any parent or subsidiary corporation employing or retaining Purchaser) for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any parent or subsidiary corporation employing or retaining Purchaser) or the Purchaser, which rights are hereby expressly reserved by each, to terminate the Purchaser’s Service at any time for any reason whatsoever, with or without cause.

8.4 Notices. Any notice required in connection with (i) the Repurchase Rights or the First Refusal Right or (ii) the disposition of any Shares covered thereby shall be given in writing and shall be deemed effective upon personal delivery or upon deposit in the United States mail, registered or certified, postage prepaid and addressed to the party entitled to such notice at the address indicated below such party’s signature line on this Agreement or at such other address as such party may designate by ten (10) days advance written notice under this paragraph 8.4 to all other parties to this Agreement.

8.5 No Waiver. The failure of the Company (or its assignees) in any instance to exercise the Repurchase Right granted under Article IV or VII or the failure of the Company (or its assignees) in any instance to exercise the First Refusal Right granted under Article V shall not constitute a waiver of any other repurchase right and/or right of first refusal that may subsequently arise under the provisions of this Agreement or any other agreement between the Company and the Purchaser or the Purchaser’s spouse. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature.

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

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IX. MISCELLANEOUS PROVISIONS

9.1 Purchaser Undertaking. Purchaser hereby agrees to take whatever additional action and execute whatever additional documents the Company may in its judgment deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on either the Purchaser or the Shares pursuant to the express provisions of this Agreement.

9.2 Agreement is Amendment of the Grant Agreement. This Agreement amends and supplements (but does not restate in its entirety) the Grant Agreement. To the extent any provision of this Agreement conflicts with a provision of the Grant Agreement, this Agreement shall control. Purchaser acknowledges that this Agreement supercedes all previous understandings, written or oral, with respect to the subject matter hereof, including without limitation, that certain Restricted Stock Agreement dated December 7, 1999, between the Purchaser and the Company which was superseded and restated by the Grant Agreement.

9.3 Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California, as such laws are applied to contracts entered into and performed in such State without resort to that State’s conflict-of-laws rules.

9.4 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

9.5 Successors and Assigns. The provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and the Purchaser and the Purchaser’s legal representatives, heirs, legatees, distributees, assigns and transferees by operation of law, whether or not any such person shall have become a party to this Agreement and have agreed in writing to join herein and be bound by the terms and conditions hereof.

9.6 Amendment and Waiver. This Agreement shall not be amended nor any Section hereof waived by the Company in the absence of approval of such amendment or waiver by a majority of the Company’s Board of Directors.

9.7 Arbitration. Any controversy between the parties hereto involving any claim arising out of or relating to this Agreement shall be finally settled by arbitration in Palo Alto, California, in accordance with the then current Commercial Arbitration Rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof.

[Remainder of this page intentionally left blank.]

11.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first indicated above.

THE COMPANY:
DANGER RESEARCH, INC.
/s/ Andrew E. Rubin
Name:	Andrew E. Rubin
Title:	President
PURCHASER:
/s/ Matthew J. Hershenson
By:	Matthew J. Hershenson

CONSENT OF SPOUSE

I acknowledge that I have read the foregoing Restricted Stock Agreement and that I know its contents. I hereby agree that those shares and my interest in them, if any, are subject to the provisions of the Restricted Stock Agreement and that I will take no action at any time to hinder operation of or violate the Restricted Stock Agreement.

/s/ Mar Hershenson

(Signature of Stockholder’s Spouse)

EXHIBIT A

ASSIGNMENT SEPARATE FROM CERTIFICATE

FOR VALUE RECEIVED,                      hereby sell(s), assign(s) and transfer(s) unto Danger Research, Inc. (the “Company”)                      (                    ) shares of the Common Stock of the Company standing in                                          name on the books of the Company represented by Certificate No.                          herewith and do hereby irrevocably constitute and appoint                      Attorney to transfer the said stock on the books of the Company with full power of substitution in the premises.

Dated:                    

Signature /s/ Matthew J. Hershenson

Instruction: Please do not fill in any blanks other than the signature line. The purpose of this assignment is to enable the Company to exercise its rights as set forth in the Agreement without requiring additional signatures on the part of the Purchaser.

AMENDMENT NO. 1

TO THE

DANGER, INC.

RESTRICTED STOCK AGREEMENT

THIS AMENDMENT NO. 1 to the Danger, Inc. Restricted Stock Agreement, (the “Amendment”) is entered into this 11^th day of March, 2003, by and among Danger, Inc., a Delaware corporation (the “Company”) and Matthew J. Hershenson (the “Purchaser”).

RECITALS

WHEREAS, the Company and the Purchaser have entered into that certain Restricted Stock Agreement, dated as of September 22, 2000, (the “Restricted Stock Agreement”) pursuant to which Purchaser agreed to restrict shares of the Company’s Common Stock held by Purchaser to certain transfer restrictions.

WHEREAS, the Company, the Purchaser and the Company’s Board of Directors now wish to amend the Restricted Stock Agreement pursuant to the provisions of Section 9.6 thereof in order to revise the meaning of certain terms defined in the Restricted Stock Agreement.

AMENDMENT

NOW, THEREFORE, in consideration of the foregoing and the mutual promises and conditions of this Amendment, and for other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Amendment of Agreement. This Amendment hereby amends and revises the Restricted Stock Agreement to incorporate the terms and conditions set forth herein. Except as otherwise explicitly provided in this Amendment, the Restricted Stock Agreement will remain unchanged and in full force and effect. The term “Agreement” as used in the Restricted Stock Agreement and all other instruments and agreements executed thereunder shall for all purposes refer to the Restricted Stock Agreement as amended by this Amendment.

2. Modifications to the Agreement.

(a) The parties hereto hereby agree to amend Section 4.3(b) of the Restricted Stock Agreement in its entirety, which section shall be restated and replaced with the following:

“(b) So long as the Company’s Repurchase Right remains in effect, 1,000,000 (or such lesser amount of Unvested Shares remaining) of the then Unvested Shares of the Purchaser shall vest immediately and the Repurchase Right shall lapse with respect to such number of the Unvested Shares if the Purchaser is terminated by the Company, actually or constructively, without “Cause” (an “Acceleration Event”). For purposes of this Agreement, the term “Cause” shall mean the commission of any act of fraud, embezzlement or dishonesty by Purchaser, any unauthorized use or disclosure by Purchaser of confidential information or trade secrets of the Company, or any other intentional misconduct by Purchaser adversely affecting the business or affairs of the Company in a material manner.”

3. This Amendment may be executed in several counterparts, each of which shall he deemed an original, but all of which together shall constitute one and the same instrument.

4. Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to them in the Restricted Stock Agreement.

5. This Amendment, together with the Restricted Stock Agreement as amended hereby, shall supersede and replace any prior agreement between the Company and the Purchaser relating to the subject matter hereof.

6. This Amendment shall be governed by and construed under the laws of the State of California as applied to agreements among California residents entered into and to be performed entirely within California.

[Signature Page Follows]

IN WITNESS WHEREOF, the Company and the undersigned Purchaser have executed this Amendment effective as of the day and year first written above.

COMPANY:
Danger, Inc.
By:	/s/ Henry R. Nothhaft
	Henry R. Nothhaft, Chief Executive Officer
PURCHASER:
By:	/s/ Matthew J. Hershenson
	Matthew J. Hershenson

EX-10.13

EXHIBIT 10.13

DANGER RESEARCH, INC.

RESTRICTED STOCK AGREEMENT

TABLE OF CONTENTS

			PAGE
I.	SECURITIES LAW COMPLIANCE		1
	1.1	Restricted Securities	1
	1.2	Disposition of Shares	2
	1.3	Restrictive Legends	2
II.	SPECIAL TAX PROVISIONS		3
	2.1	Valuation of Common Stock	3
III.	TRANSFER RESTRICTIONS		3
	3.1	Definition of Owner	3
	3.2	Restriction on Transfer	3
	3.3	Transferee Obligations	4
	3.4	Market Stand-Off Provisions	4
IV.	REPURCHASE RIGHT		4
	4.1	Grant	4
	4.2	Exercise of the Repurchase Right	5
	4.3	Termination of the Repurchase Right	5
	4.4	Fractional Shares	6
	4.5	Additional Shares or Substituted Securities	6
V.	RIGHT OF FIRST REFUSAL		6
	5.1	Grant	6
	5.2	Notice of Intended Disposition	6
	5.3	Exercise of Right	7
	5.4	Non-Exercise of Right	7
	5.5	Partial Exercise of Right	7
	5.6	Recapitalization	8
	5.7	Lapse	8
VI.	ESCROW		8
	6.1	Deposit	8
	6.2	Recapitalization	8
	6.3	Release/Surrender	9

-i-

TABLE OF CONTENTS

(CONTINUED)

			PAGE
VII.	MARITAL DISSOLUTION OR LEGAL SEPARATION		10
	7.1	Grant	10
	7.2	Notice of Decree or Agreement	10
	7.3	Exercise of the Special Purchase Right	10
	7.4	Lapse	11
VIII.	GENERAL PROVISIONS		11
	8.1	Assignment	11
	8.2	Definitions	11
	8.3	No Employment or Service Contract	11
	8.4	Notices	11
	8.5	No Waiver	12
	8.6	Cancellation of Shares	12
IX.	MISCELLANEOUS PROVISIONS		12
	9.1	Purchaser Undertaking	12
	9.2	Agreement is Amendment of the Grant Agreement	12
	9.3	Governing Law	12
	9.4	Counterparts	12
	9.5	Successors and Assigns	12
	9.6	Amendment and Waiver	13
	9.7	Arbitration	13

EXHIBIT A – ASSIGNMENT SEPARATE FROM CERTIFICATE

EXHIBIT B – SECTION 83(b) TAX ELECTION

-ii-

RESTRICTED STOCK AGREEMENT

THIS RESTRICTED STOCK AGREEMENT (this “Agreement”) is made as of this 22nd day of September, 2000, by and between Danger Research, Inc., a Delaware corporation (the “Company”), and Joe F. Britt, Jr. (“Purchaser”).

WHEREAS, Purchaser has purchased 4,000,000 shares of the Company’s Common Stock (the “Shares”), at a purchase price of $0.0075 per share (the “Purchase Price”), or $30,000 in the aggregate pursuant to that certain Restricted Stock Purchase Agreement, dated March 10, 2000, by and between Purchaser and the Company (the “Grant Agreement”);

WHEREAS, the Company has entered into a Series A Preferred Stock Purchase Agreement (the “Series A Purchase Agreement”), of even date herewith, under which the Company has agreed to sell, to the investors listed on Schedule A thereto (the “Investors”), and the Investors have agreed to purchase, shares of the Series A Preferred Stock of the Company;

WHEREAS, execution and delivery of this Agreement is a condition to the obligations of the Investors under the Series A Purchase Agreement; and

WHEREAS, the purpose of this Agreement is to amend and supplement (and not to restate in its entirety) the Grant Agreement;

NOW THEREFORE, in consideration of the mutual promises and obligations set forth herein and in the Series A Purchase Agreement and the documents executed and delivered in connection therewith, the parties agree as follows:

I. SECURITIES LAW COMPLIANCE

1.1 Restricted Securities.

(a) Purchaser hereby confirms that Purchaser has been informed that the Shares are restricted securities under the Securities Act of 1933, as amended (“1933 Act”), and may not be resold or transferred unless the Shares are first registered under the federal securities laws or unless an exemption from such registration is available. Accordingly, Purchaser hereby acknowledges that Purchaser is prepared to hold the Shares for an indefinite period and that Purchaser is aware that Rule 144 of the Securities and Exchange Commission (“SEC”) issued under the 1933 Act is not presently available to exempt the sale of the Shares from the registration requirements of the 1933 Act.

(b) Upon the expiration of the ninety (90)-day period immediately following the date on which the Company first becomes subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Shares, to the extent vested under Article IV, may be sold (without registration) pursuant to the applicable requirements of Rule 144. If Purchaser is at the time of such sale an affiliate of the Company for purposes of Rule 144 or was such an affiliate during the preceding three (3) months, then the sale must comply with all the requirements of Rule 144 (including the volume limitation on the number of shares sold, the broker/market-maker sale requirement and the requisite notice to the SEC); however, the one-year holding period requirement of the Rule will not be applicable. If Purchaser is not at the

time of the sale an affiliate of the Company nor was such an affiliate during the preceding three (3) months, then none of the requirements of Rule 144 (other than the broker/market-maker sale requirement for Shares held for fewer than two (2) years following payment in cash of the Purchase Price therefor) will be applicable to the sale. The requirements of Rule 144 are subject to change at any time.

(c) Should the Company not become subject to the reporting requirements of the Exchange Act, then Purchaser may, provided he is not at the time an affiliate of the Company (nor was such an affiliate during the preceding three (3) months), sell the Shares (without registration) pursuant to paragraph (k) of Rule 144 after the Shares have been held for a period of two (2) years following the payment in cash of the Purchase Price for such shares.

1.2 Disposition of Shares. Subject to the terms of this Agreement, Purchaser hereby agrees that Purchaser shall make no disposition of the Shares (other than a permitted transfer under paragraph 3.2) unless and until there is compliance with all of the following requirements:

(a) Purchaser shall have notified the Company of the proposed disposition and provided a written summary of the terms and conditions of the proposed disposition;

(b) Purchaser shall have complied with all requirements of this Agreement applicable to the disposition of the Shares;

(c) Purchaser shall have provided the Company with written assurances, in form and substance satisfactory to the Company, that (i) the proposed disposition does not require registration of the Shares under the 1933 Act or (ii) all appropriate action necessary for compliance with the registration requirements of the 1933 Act or of any exemption from registration available under the 1933 Act (including Rule 144) has been taken; and

(d) Purchaser shall have provided the Company with written assurances, in form and substance satisfactory to the Company, that the proposed disposition will not result in the contravention of any transfer restrictions applicable to the Shares.

The Company shall not be required (i) to transfer on its books any Shares which have been sold or transferred in violation of the provisions of this Article I nor (ii) to treat as the owner of the Shares, or otherwise to accord voting or dividend rights to, any transferee to whom the Shares have been transferred in contravention of this Agreement.

1.3 Restrictive Legends. In order to reflect the restrictions on disposition of the Shares, the stock certificates for the Shares have been endorsed with restrictive legends, including legends in substantially the form of one or more of the following legends:

(a) “The shares represented by this certificate have not been registered under the Securities Act of 1933, as amended. The shares may not be sold or offered for sale in the absence of (1) an effective registration statement for the shares under such Act, (2) a ‘no action’ letter of the SEC with respect to such sale or offer, or (3) satisfactory assurances to the Company that registration under such Act is not required with respect to such sale or offer.”

2.

(b) “The shares represented by this certificate are unvested and accordingly may not be sold, assigned, transferred, encumbered, or in any manner disposed of except in conformity 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 and rights of first refusal to the Company (or its assignees) upon the sale, assignment, transfer, encumbrance or other disposition of the Company’s shares or upon termination of service with the Company. The Company will upon written request furnish a copy of such agreement to the holder hereof without charge.”

II. SPECIAL TAX PROVISIONS

2.1 Valuation of Common Stock. Purchaser understands that the price paid for the Shares has been valued by the Board of Directors and that the Company believes this valuation represents a fair attempt at reaching an accurate appraisal of their worth; Purchaser understands, however, that the Company can give no assurances that such price is in fact the fair market value of the Shares and that it is possible that, with the benefit of hindsight, the Internal Revenue Service would successfully assert that the value of the Shares on the date of purchase is substantially greater than so determined.

If the Internal Revenue Service were to succeed in a tax determination that the Shares received had value greater than that upon which the transaction was based, the additional value would constitute ordinary income as of the date of its receipt. The additional taxes (and interest) due would be payable by Purchaser, and there is no provision for the Company to reimburse him for that tax liability, and Purchaser assumes all responsibility for such potential tax liability. In the event that such additional value would represent more than twenty-five percent (25%) of Purchaser’s gross income for the year in which the value of the Shares was taxable, the Internal Revenue Service would have six years from the due date for filing the return (or the actual filing date of the return if filed thereafter) within which to assess Purchaser the additional tax and interest which would then be due.

The Company would have the benefit, in any such transaction, if a determination was made prior to the three year statute of limitations period affecting the Company, of an increase in its deduction for compensation paid, which would offset its operating profits, or, if not profitable, would create net operating loss carry forward arising from operations in that year.

III. TRANSFER RESTRICTIONS

3.1 Definition of Owner. For purposes of this Agreement, the term “Owner” shall include the Purchaser and all subsequent holders of the Shares who derive their chain of ownership through a permitted transfer from the Purchaser in accordance with paragraph 3.2.

3.2 Restriction on Transfer. Owner shall not transfer, assign, encumber or otherwise dispose of any of the Shares which are subject to the Company’s Repurchase Rights in this Agreement. In addition, Shares which are released from the Repurchase Rights shall not be transferred, assigned, encumbered or otherwise made the subject of disposition in contravention of the Company’s First Refusal Right under Article V or as otherwise limited herein. Such restrictions on transfer, however, shall not be applicable to (i) a gratuitous transfer of the Shares

3.

made to the Owner’s spouse or issue, including adopted children, or to a trust for the exclusive benefit of the Owner or the Owner’s spouse or issue, provided and only if the Owner obtains the Company’s prior written consent to such transfer and such transferee agrees to be bound by the terms of this Agreement, (ii) a transfer of title to the Shares effected pursuant to the Owner’s will or the laws of intestate succession or (iii) a transfer to the Company in pledge as security for any purchase-money indebtedness incurred by Purchaser in connection with the acquisition of the Shares.

3.3 Transferee Obligations. Each person (other than the Company) to whom the Shares are transferred by means of one of the permitted transfers specified in paragraph 3.2 must, as a condition precedent to the validity of such transfer, acknowledge in writing to the Company that such person is bound by the provisions of this Agreement and that the transferred shares are subject to (i) both the Company’s Repurchase Rights and the Company’s First Refusal Right granted hereunder and (ii) the market stand-off provisions of paragraph 3.4, to the same extent such Shares would be so subject if retained by the Purchaser.

3.4 Market Stand-Off Provisions.

(a) In connection with the first or second underwritten public offering by the Company of its equity securities pursuant to an effective registration statement filed under the 1933 Act, Owner shall not sell, make any short sale of, loan, hypothecate, pledge, grant any option for the purchase of, or otherwise dispose or transfer for value or otherwise agree to engage in any of the foregoing transactions with respect to, any Shares without the prior written consent of the Company or its underwriters. Such limitations shall be in effect for such period of time from and after the effective date of such registration statement as may be requested by the Company or such underwriters; provided, however, that in no event shall such period exceed one hundred-eighty (180) days and ninety (90) days for the first secondary public offering by the Company.

(b) Owner shall be subject to the market stand-off provisions of this paragraph 3.4 provided and only if the executive officers and directors of the Company are also subject to similar arrangements.

(c) In the event of any stock dividend, stock split, recapitalization or other change affecting the Company’s outstanding Common Stock effected without receipt of consideration, then any new, substituted or additional securities distributed with respect to the Shares shall be immediately subject to the provisions of this paragraph 3.4, to the same extent the Shares are at such time covered by such provisions.

(d) In order to enforce the limitations of this paragraph 3.4, the Company may impose stop-transfer instructions with respect to the Shares until the end of the applicable stand-off period.

IV. REPURCHASE RIGHT

4.1 Grant. The Company (or its assignees) is hereby granted the right (the “Repurchase Right”), exercisable at any time during the sixty (60)-day period following the date the Purchaser ceases for any reason to remain in service to the Company (“Service”) or (if later)

4.

during the sixty (60)-day period following the execution date of this Agreement, to repurchase at the Purchase Price all or (at the discretion of the Company) any portion of the Shares in which the Purchaser has not acquired a vested interest in accordance with the vesting provisions of this Article IV (such shares to be hereinafter called the “Unvested Shares”). For purposes of this Agreement, the Purchaser shall be deemed to remain in Service for so long as the Purchaser continues to render services to the Company or parent, subsidiary or successor corporation as an employee, consultant or director. Purchaser agrees that any Shares subject to the Repurchase Right shall be held in escrow by the Company until the Shares become vested.

4.2 Exercise of the Repurchase Right. The Repurchase Right shall be exercisable by written notice delivered to the Owner of the Unvested Shares prior to the expiration of the applicable sixty (60)-day period specified in paragraph 4.1. The notice shall indicate the number of Unvested Shares to be repurchased and the date on which the repurchase is to be effected, such date to be not more than thirty (30) days after the date of notice. To the extent one or more certificates representing Unvested Shares may have been previously delivered out of escrow to the Owner, then Owner shall, prior to the close of business on the date specified for the repurchase, deliver to the Secretary of the Company the certificates representing the Unvested Shares to be repurchased, each certificate to be properly endorsed for transfer. The Company shall, concurrently with the receipt of such stock certificates (either from escrow in accordance or from Owner as herein provided), pay to Owner in cash or cash equivalents (including the cancellation of any purchase-money indebtedness), an amount equal to the per Share Purchase Price previously paid for the Unvested Shares which are to be repurchased.

4.3 Termination of the Repurchase Right. The Repurchase Right shall terminate with respect to any Unvested Shares for which it is not timely exercised under paragraph 4.2. In addition, the Repurchase Right as to certain Unvested Shares shall terminate, and cease to be exercisable, solely to the extent set forth below, on the earliest to occur of (i) an Acceleration Event of the Purchaser as described in Section 4.3(b) below or (ii) with respect to any and all Shares in which the Purchaser vests in accordance with the schedule set forth in Section 4.3(a) below. Accordingly, as, and provided that, the Purchaser continues in continuous Service, as defined above, or upon the occurrence of an Acceleration Event, the Purchaser shall acquire a vested interest in, and the Repurchase Right as to certain Unvested Shares, solely to the extent set forth below, shall lapse with respect to, the Shares in accordance with the following provisions:

(a) The Purchaser shall have a vested interest in 1,000,000 shares on the date hereof. With respect to the remaining 3,000,000 Shares, the Purchaser shall acquire a vested interest in, and the Repurchase Right shall lapse in thirty-six (36) equal and continuous monthly installments for each monthly period of continuous Service after September 22, 2000, and, for the thirty-six (36) months following September 22, 2000, such that Purchaser shall be fully vested in all Shares after thirty-six (36) months of continuous Service completed by the Purchaser following September 22, 2000; and

(b) So long as the Company’s Repurchase Right remains in effect, 1,000,000 (or such lesser amount of Unvested Shares remaining) of the then Unvested Shares of the Purchaser shall vest immediately and the Repurchase Right shall lapse with respect to such number of the Unvested Shares if the Purchaser is terminated by the Company, actually or constructively,

5.

without “Cause” (an “Acceleration Event”). For purposes of this Agreement, the term “Cause” shall mean any one of the following: (i) gross negligence or the repeated failure of Purchaser, following the receipt of written notice from the Board of its dissatisfaction with the Purchaser’s performance, to perform his duties and responsibilities to the reasonable satisfaction of the Board; (ii) any breach by Purchaser of his fiduciary duties to the Company or any material term of this Agreement; or (iii) the conviction of Purchaser for a felony. For purposes of this Agreement, any act or acts or omission or omissions by Purchaser that have .a material adverse effect on the Company’s operations, prospects, reputation or business shall be deemed to be a breach of his duties and responsibilities to the Company.

(c) All Shares as to which the Repurchase Right lapses shall, however, continue to be subject to (i) the First Refusal Right until the lapse of such First Refusal Right, (ii) the market stand-off provisions of paragraph 3.4 and (iii) the Special Purchase Rights set forth under Article VII.

4.4 Fractional Shares. No fractional shares shall be repurchased by the Company. Accordingly, should the Repurchase Right extend to a fractional share (in accordance with the vesting computation provisions of paragraphs 4.3 and 4.6) at the time the Purchaser ceases Service or pursuant hereto, then such fractional share shall be added to any fractional share in which the Purchaser is at such time vested in order to make one whole vested share no longer subject to the Repurchase Right.

4.5 Additional Shares or Substituted Securities. In the event of any stock dividend, stock split, recapitalization or other change affecting the Company’s outstanding Common Stock as a class effected without receipt of consideration, then any new, substituted or additional securities or other property (including money paid other than as a regular cash dividend) which is by reason of any such transaction distributed with respect to the Shares shall be immediately subject to the Repurchase Right, but only to the extent the Shares are at the time covered by such right. Appropriate adjustments to reflect the distribution of such securities or property shall be made to the number of Shares at the time subject to the Repurchase Right hereunder and to the price per share to be paid upon the exercise of the Repurchase Right in order to reflect the effect of any such transaction upon the Company’s capital structure; provided, however, that the aggregate Purchase Price shall remain the same.

V. RIGHT OF FIRST REFUSAL

5.1 Grant. The Company is hereby granted the right of first refusal (the “First Refusal Right”), exercisable in connection with any proposed transfer of the Shares. For purposes of this Article V, the term “transfer” shall include any sale, assignment, pledge, encumbrance or other disposition for value of the Shares intended to be made by the Owner, but shall exclude any of the permitted transfers under paragraph 3.2.

5.2 Notice of Intended Disposition. In the event the Owner desires to accept a bona fide third-party offer for any or all of the Shares (the shares subject to such offer to be hereinafter called the “Target Shares”), Owner shall promptly (i) deliver to the Corporate Secretary of the Company written notice (the “Disposition Notice”) of the terms and conditions of the offer, including the purchase price and the identity of the third-party offeror and (ii) provide satisfactory proof that the disposition of the Target Shares to such third-party offeror would not be in contravention of the provisions set forth in Articles I and III of this Agreement.

6.

5.3 Exercise of Right. The Company (or its assignees) shall, for a period of twenty-five (25) days following receipt of the Disposition Notice, have the right to repurchase any or all of the Target Shares specified in the Disposition Notice upon substantially the same terms and conditions specified therein. Such right shall be exercisable by delivery of written notice (the “Exercise Notice”) to Owner prior to the expiration of the twenty-five (25) day exercise period. If such right is exercised with respect to all the Target Shares specified in the Disposition Notice, then the Company (or its assignees) shall effect the repurchase of the Target Shares, including payment of the purchase price, not more than five (5) business days after delivery of the Exercise Notice; and at such time Owner shall deliver to the Company the certificates representing the Target Shares to be repurchased, each certificate to be properly endorsed for transfer. To the extent any of the Target Shares are at the time held in escrow under Article VI, the certificates for such shares shall automatically be released from escrow and delivered to the Company for purchase.

5.4 Non-Exercise of Right. In the event the Exercise Notice is not given to Owner within twenty-five (25) days following the date of the Company’s receipt of the Disposition Notice, Owner shall have a period of thirty (30) days thereafter in which to sell or otherwise dispose of the Target Shares to the third-party offeror identified in the Disposition Notice upon terms and conditions (including the purchase price) no more favorable to such third-party offeror than those specified in the Disposition Notice; provided, however, that any such sale or disposition must not be effected in contravention of the provisions of Article I of this Agreement. To the extent any of the Target Shares are at the time held in escrow under Article VI, the certificates for such shares shall automatically be released from escrow and surrendered to the Owner. The third-party offeror shall acquire the Target Shares free and clear of the Company’s Repurchase Right under Article IV, but the acquired shares shall remain subject to (i) the securities law restrictions under Article I, (ii) the market stand-off provisions of paragraph 3.4, (iii) the Company’s First Refusal Rights hereunder and (iv) Article VII.

5.5 Partial Exercise of Right. In the event the Company (or its assignees) makes a timely exercise of the First Refusal Right with respect to a portion, but not all, of the Target Shares specified in the Disposition Notice, Owner shall have the option, exercisable by written notice to the Company delivered within thirty (30) days after the date of the Disposition Notice, to effect the sale of the Target Shares pursuant to one of the following alternatives:

(a) sale or other disposition of all the Target Shares to the third-party offeror identified in the Disposition Notice, but in full compliance with the requirements of paragraph 5.4, as if the Company did not exercise the First Refusal Right hereunder; or

(b) sale to the Company (or its assignees) of the portion of the Target Shares which the Company (or its assignees) has elected to purchase, such sale to be effected in substantial conformity with the provisions of paragraph 5.3.

7.

Failure of Owner to deliver timely notification to the Company under this paragraph 5.5 shall be deemed to be an election by Owner to sell the Target Shares pursuant to alternative (a) above.

5.6 Recapitalization. In the event of any stock dividend, stock split, recapitalization. or other transaction affecting the Company’s outstanding Common Stock as a class effected without receipt of consideration, then any new, substituted or additional securities or other property which is by reason of such, transaction distributed with respect to the Shares shall be immediately subject to the Company’s First Refusal Right hereunder, but only to the extent the Shares are at the time covered by such right.

5.7 Lapse. The First Refusal Right under this Article V shall remain in effect under all circumstances but shall lapse and cease to have effect upon the earliest to occur of (i) the first date on which shares of the Company’s Common Stock are held of record by more than five hundred (500) persons, (ii) a determination is made by the Company’s Board of Directors that a public market exists for the outstanding shares of the Company’s Common Stock, (iii) an underwritten public offering pursuant to an effective registration statement under the 1933 Act or (iv) in the event of either of the following transactions (each a “Corporate Transaction”): (x) a merger or consolidation of the Company, in which the stockholders of the Company do not control fifty percent (50%) or more of the total voting power of the surviving entity (other than a mere reincorporation merger) or (y) the sale, transfer or other disposition of all or substantially all of the Company’s assets in liquidation or dissolution of the Company. However, the market stand-off provisions of paragraph 3.4 shall continue to remain in full force and effect following the lapse of the First Refusal Right hereunder.

VI. ESCROW

6.1 Deposit. The certificates for any Unvested Shares have been deposited in escrow with the Company to be held in accordance with the provisions of this Article VI. Each deposited certificate is accompanied by a duly executed Assignment Separate from Certificate in the form of Exhibit A. The deposited certificates, together with any other assets or securities from time to time deposited with the Company pursuant to the requirements of this Agreement, shall remain in escrow until such time or times as the certificates (or other assets and securities) are to be released or otherwise surrendered for cancellation in accordance with paragraph 6.3. Upon delivery of the certificates (or other assets and securities) to the Company, the Owner shall be issued an instrument of deposit acknowledging the number of Unvested Shares (or other assets and securities) delivered in escrow to the Company.

6.2 Recapitalization. All regular cash dividends on the Unvested Shares (or other securities at the time held in escrow) shall be paid directly to the Owner and shall not be held in escrow. However, in the event of any stock dividend, stock split, recapitalization or other change affecting the Company’s outstanding Common Stock as a class effected without receipt of consideration or in the event of a Corporate Transaction, any new, substituted or additional securities or other property which is by reason of such transaction distributed with respect to the Unvested Shares shall be immediately delivered to the Company to be held in escrow under this Article VI, but only to the extent the Unvested Shares are at the time subject to the escrow requirements of paragraph 6.1.

8.

6.3 Release/Surrender. The Unvested Shares, together with any other assets or securities held in escrow hereunder, shall be subject to the following terms and conditions relating to their release from escrow or their surrender to the Company for repurchase and cancellation:

(a) Should the Company (or its assignees) elect to exercise the Repurchase Right under Article IV with respect to any Unvested Shares, then the escrowed certificates for such Unvested Shares (together with any other assets or securities issued with respect thereto) shall be delivered to the Company, concurrently with the payment to the Owner, in cash or cash equivalent (including the cancellation of any purchase-money indebtedness), of an amount equal to the aggregate Purchase Price for such Unvested Shares, and the Owner shall cease to have any further rights or claims with respect to such Unvested Shares (or other assets or securities attributable to such Unvested Shares).

(b) Should the Company (or its assignees) elect to exercise its First Refusal Right under Article V with respect to any vested Target Shares held at the time in escrow hereunder, then the escrowed certificates for such Target Shares (together with any other assets or securities attributable thereto) shall, concurrently with the payment of the paragraph 5.3 purchase price for such Target Shares to the Owner, be surrendered to the Company, and the Owner shall cease to have any further rights or claims with respect to such Target Shares (or other assets or securities).

(c) Should the Company (or its assignees) elect not to exercise its First Refusal Right under Article V with respect to any Target Shares held at the time in escrow hereunder, then the escrowed certificates for such Target Shares (together with any other assets or securities attributable thereto) shall be surrendered to the Owner for disposition in accordance with the provisions of paragraph 5.4.

(d) As the interest of the Owner in the Unvested Shares (or any other assets or securities attributable thereto) vests in accordance with the provisions of Article IV, the certificates for such vested shares (as well as all other vested assets and securities) shall be released from escrow and delivered to the Owner in accordance with the following schedule:

(1) Upon the Purchaser’s cessation of Service, any escrowed Shares (or other assets or securities) in which the Purchaser is at the time vested shall be promptly released from escrow.

(2) Upon any earlier termination of the Company’s Repurchase Right in accordance with the applicable provisions of Article IV, the Shares (or other assets or securities) at the time held in escrow hereunder shall promptly be released to the Owner as fully-vested shares or other property.

(3) All Shares (or other assets or securities) released from escrow in accordance with the provisions of subparagraph (2) above shall nevertheless remain subject to (i) the Company’s First Refusal Right under Article V until such right lapses pursuant to paragraph 5.7 and Article II and (ii) the market stand-off provisions of paragraph 3.4 until such provisions terminate in accordance therewith.

9.

VII. MARITAL DISSOLUTION OR LEGAL SEPARATION

7.1 Grant. Notwithstanding anything in this Agreement to the contrary, in connection with the dissolution of Owner’s marriage or the legal separation of Owner and Owner’s spouse, the Company shall have the right (the “Special Purchase Right”) to purchase from Purchaser’s spouse, in accordance with the provisions of this Article VII, all or any portion of the Shares which would otherwise be awarded to such spouse in settlement of any community property or other marital property rights such spouse may have in such shares.

7.2 Notice of Decree or Agreement. Owner shall promptly provide the Company with written notice (the “Dissolution Notice”) of (i) the entry of any judicial decree or order resolving the property rights of Owner and Owner’s spouse in connection with their marital dissolution or legal separation or (ii) the execution of any contract or agreement relating to the distribution or division of such property rights. The Dissolution Notice shall be accompanied by a copy of the actual decree or order of dissolution or contract or agreement between Owner and Owner’s spouse which provides for the award to the spouse of one or more Shares in settlement of any community property or other marital property rights such spouse may have in such shares.

7.3 Exercise of the Special Purchase Right. The Special Purchase Right shall be exercisable by delivery of written notice (the “Purchase Notice”) to Owner and Owner’s spouse within forty-five (45) days after the Company’s receipt of the Dissolution Notice. The Purchase Notice shall indicate the number of Shares to be purchased by the Company, the date such purchase is to be effected (such date to be not less than five (5) business days, nor more than fifteen (15) business days, after the date of the Purchase Notice) and the fair market value to be paid for such Shares. Owner (or Owner’s spouse, to the extent such spouse has physical possession of the Shares) shall, prior to the close of business on the date specified for the purchase, deliver to the Company the certificates representing the shares to be purchased. The Company shall, concurrently with the receipt of the stock certificates, pay to Owner’s spouse (in cash or cash equivalents) an amount equal to the fair market value specified for such shares in the Purchase Notice.

If Owner’s spouse does not agree with the fair market value specified for the Shares in the Purchase Notice, then the spouse shall promptly notify the Company in writing of such disagreement and the fair market value of such Shares shall thereupon be determined by an appraiser of recognized standing selected by the Company and the spouse. If they cannot agree on an appraiser within fifteen (15) days after the date of the Purchase Notice, each shall select an appraiser of recognized standing, and the two (2) appraisers shall designate a third appraiser of recognized standing whose appraisal shall be determinative of such value. The cost of the appraisal shall be shared equally by the Company and Owner’s spouse. The closing shall then be held on the fifteenth (15th) business day following the completion of such appraisal; provided, however, that if the appraised value is more than twenty-five percent (25%) greater than the fair market value specified for the Shares in the Purchase Notice, the Company shall have the right, exercisable prior to the expiration of such fifteen (15) business-day period, to rescind the exercise of the Special Purchase Right and thereby revoke its election to purchase the Shares awarded to the spouse.

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7.4 Lapse. The Special Purchase Right shall lapse upon the earlier to occur of (i) the lapse of the First Refusal Right or (ii) the expiration of the exercise period specified in this Article VII, to the extent the Special Purchase Right is not timely exercised in accordance with such paragraph.

VIII. GENERAL PROVISIONS

8.1 Assignment. The Company may assign its Repurchase Right under Article IV and/or its First Refusal Right under Article V and/or its Special Purchase Rights under Article VII to any person or entity selected by the Company’s Board of Directors, including (without limitation) one or more stockholders of the Company.

If the assignee is other than a parent or subsidiary corporation of the Company, then such assignee must make a cash payment to the Company, upon the assignment of the Repurchase Right, in an amount equal to the excess (if any) of (i) the fair market value of the Unvested Shares at the time subject to the assigned Repurchase Right over (ii) the aggregate repurchase price payable for Unvested Shares thereunder.

8.2 Definitions. For purposes of this Agreement, the following provisions shall be applicable in determining the parent and subsidiary corporations of the Company:

(a) Any corporation (other than the Company) in an unbroken chain of corporations ending with the Company shall be considered to be a parent corporation of the Company, provided each such corporation in the unbroken chain (other than the Company) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

(b) Each corporation (other than the Company) in an unbroken chain of corporations beginning with the Company shall be considered to be a subsidiary of the Company, provided each such corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

8.3 No Employment or Service Contract. Nothing contained in this Agreement shall confer upon the Purchaser any right to continue in the Service of the Company (or any parent or subsidiary corporation employing or retaining Purchaser) for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any parent or subsidiary corporation employing or retaining Purchaser) or the Purchaser, which rights are hereby expressly reserved by each, to terminate the Purchaser’s Service at any time for any reason whatsoever, with or without cause.

8.4 Notices. Any notice required in connection with (i) the Repurchase Rights or the First Refusal Right or (ii) the disposition of any Shares covered thereby shall be given in writing and shall be deemed effective upon personal delivery or upon deposit in the United States mail, registered or certified, postage prepaid and addressed to the party entitled to such notice at the address indicated below such party’s signature line on this Agreement or at such other address as such party may designate by ten (10) days advance written notice under this paragraph 8.4 to all other parties to this Agreement.

11.

8.5 No Waiver. The failure of the Company (or its assignees) in any instance to exercise the Repurchase Right granted under Article IV or VII or the failure of the Company (or its assignees) in any instance to exercise the First Refusal Right granted under Article V shall not constitute a waiver of any other repurchase right and/or right of first refusal that may subsequently arise under the provisions of this Agreement or any other agreement between the Company and the Purchaser or the Purchaser’s spouse. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature.

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

IX. MISCELLANEOUS PROVISIONS

9.1 Purchaser Undertaking. Purchaser hereby agrees to take whatever additional action and execute whatever additional documents the Company may in its judgment deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on either the Purchaser or the Shares pursuant to the express provisions of this Agreement,

9.2 Agreement is Amendment of the Grant Agreement. This Agreement amends and supplements (but does not restate in its entirety) the Grant Agreement. To the extent any provision of this Agreement conflicts with a provision of the Grant Agreement, this Agreement shall control. Purchaser acknowledges that this Agreement supercedes all previous understandings, written or oral, with respect to the subject matter hereof, including without limitation, that certain Restricted Stock Agreement dated December 7, 1999, between the Purchaser and the Company which was superseded and restated by the Grant Agreement.

9.3 Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California, as such laws are applied to contracts entered into and performed in such State without resort to that State’s conflict-of-laws rules.

9.4 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument,

9.5 Successors and Assigns. The provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and the Purchaser and the Purchaser’s legal representatives, heirs, legatees, distributees, assigns and transferees by operation of law, whether or not any such person shall have become a party to this Agreement and have agreed in writing to join herein and be bound by the terms and conditions hereof.

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9.6 Amendment and Waiver. This Agreement shall not be amended nor any Section hereof waived by the Company in the absence of approval of such amendment or waiver by a majority of the Company’s Board of Directors.

9.7 Arbitration. Any controversy between the parties hereto involving any claim arising out of or relating to this Agreement shall be finally settled by arbitration in Palo Alto, California, in accordance with the then current Commercial Arbitration Rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof.

[Remainder of this page intentionally left blank.]

13.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first indicated above.

THE COMPANY:
DANGER RESEARCH, INC.
/s/ Andrew E. Rubin
Name:	Andrew E. Rubin
Title:	President
PURCHASER:
/s/ Joe F. Britt, Jr.
By:	Joe F. Britt, Jr.

EXHIBIT A

ASSIGNMENT SEPARATE FROM CERTIFICATE

FOR VALUE RECEIVED,                      hereby sell(s), assign(s) and transfer(s) unto Danger Research, Inc, (the “Company”)                      (            ) shares of the Common Stock of the Company standing in                                          name on the books of the Company represented by Certificate No.          herewith and do hereby irrevocably constitute and appoint                                          Attorney to transfer the said stock on the books of the Company with full power of substitution in the premises.

Dated:                     

Signature /s/ Joe F. Britt, Jr.

Instruction: Please do not fill in any blanks other than the signature line. The purpose of this assignment is to enable the Company to exercise its rights as set forth in the Agreement without requiring additional signatures on the part of the Purchaser.

AMENDMENT NO. 1

TO THE

DANGER, INC.

RESTRICTED STOCK AGREEMENT

THIS AMENDMENT NO. 1 to the Danger, Inc. Restricted Stock Agreement, (the “Amendment”) is entered into this 11th day of March, 2003, by and among Danger, Inc., a Delaware corporation (the “Company”) and Joe F. Britt, Jr. (the “Purchaser”).

RECITALS

WHEREAS, the Company and the Purchaser have entered into that certain Restricted Stock Agreement, dated as of September 22, 2000, (the “Restricted Stock Agreement”) pursuant to which Purchaser agreed to restrict shares of the Company’s Common Stock held by Purchaser to certain transfer restrictions.

WHEREAS, the Company, the Purchaser and the Company’s Board of Directors now wish to amend the Restricted Stock Agreement pursuant to the provisions of Section 9.6 thereof in order to revise the meaning of certain terms defined in the Restricted Stock Agreement.

AMENDMENT

NOW, THEREFORE, in consideration of the foregoing and the mutual promises and conditions of this Amendment, and for other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Amendment of Agreement. This Amendment hereby amends and revises the Restricted Stock Agreement to incorporate the terms and conditions set forth herein. Except as otherwise explicitly provided in this Amendment, the Restricted Stock Agreement will remain unchanged and in full force and effect. The term “Agreement” as used in the Restricted Stock Agreement and all other instruments and agreements executed thereunder shall for all purposes refer to the Restricted Stock Agreement as amended by this Amendment.

2. Modifications to the Agreement.

(a) The parties hereto hereby agree to amend Section 4.3(b) of the Restricted Stock Agreement in its entirety, which section shall be restated and replaced with the following:

“(b) So long as the Company’s Repurchase Right remains in effect, 1,000,000 (or such lesser amount of Unvested Shares remaining) of the then Unvested Shares of the Purchaser shall vest immediately and the Repurchase Right shall lapse with respect to such number of the Unvested Shares if the Purchaser is terminated by the Company, actually or constructively, without “Cause” (an “Acceleration Event”). For purposes of this Agreement, the term “Cause” shall mean the commission of any act of fraud, embezzlement or dishonesty by Purchaser, any unauthorized use or disclosure by Purchaser of confidential information or trade secrets

of the Company, or any other intentional misconduct by Purchaser adversely affecting the business or affairs of the Company in a material manner.”

3. This Amendment may be executed in several counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

4. Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to them in the Restricted Stock Agreement.

5. This Amendment, together with the Restricted Stock Agreement as amended hereby, shall supersede and replace any prior agreement between the Company and the Purchaser relating to the subject matter hereof.

6. This Amendment shall be governed by and construed under the laws of the State of California as applied to agreements among California residents entered into and to be performed entirely within California.

[Signature Page Follows]

2.

IN WITNESS WHEREOF the Company and the undersigned Purchaser have executed this Amendment effective as of the day and year first written above.

THE COMPANY:
Danger, Inc.
By:	/s/ Henry R. Nothhaft
	Henry R. Nothhaft, Chief Executive Officer
PURCHASER:
By:	/s/ Joe F. Britt, Jr.
	Joe F. Britt, Jr.

EX-10.14

EXHIBIT 10.14

Confidential

DANGER, INC.

2000 STOCK OPTION/STOCK ISSUANCE PLAN

(As Amended)

ARTICLE ONE

GENERAL PROVISIONS

I. PURPOSE OF THE PLAN

This 2000 Stock Option/Stock Issuance Plan is intended to promote the interests of Danger, Inc., a Delaware corporation, by providing eligible persons in the Corporation’s employ or service with the opportunity to acquire a proprietary interest, or otherwise increase their proprietary interest, in the Corporation as an incentive for them to continue in such employ or service.

Capitalized terms herein shall have the meanings assigned to such terms in the attached Appendix.

II. STRUCTURE OF THE PLAN

A. The Plan shall be divided into two (2) separate equity programs:

(i) the Option Grant Program under which eligible persons may, at the discretion of the Plan Administrator, be granted options to purchase shares of Common Stock, and

(ii) the Stock Issuance Program under which eligible persons may, at the discretion of the Plan Administrator, be issued shares of Common Stock directly, either through the immediate purchase of such shares or as a bonus for services rendered the Corporation (or any Parent or Subsidiary).

B. The provisions of Articles One and Four shall apply to both equity programs under the Plan and shall accordingly govern the interests of all persons under the Plan.

III. ADMINISTRATION OF THE PLAN

A. The Plan shall be administered by the Board. However, any or all administrative functions otherwise exercisable by the Board may be delegated to the Committee. Members of the Committee shall serve for such period of time as the Board may determine and shall be subject to removal by the Board at any time. The Board may also at any time terminate the functions of the Committee and reassume all powers and authority previously delegated to the Committee.

B. The Plan Administrator shall have full power and authority (subject to the provisions of the Plan) to establish such rules and regulations as it may deem appropriate for proper administration of the Plan and to make such determinations under, and issue such interpretations of, the Plan and any outstanding options or stock issuances thereunder as it may deem necessary or advisable. Decisions of the Plan Administrator shall be final and binding on all parties who have an interest in the Plan or any option grant or stock issuance thereunder.

IV. ELIGIBILITY

A. The persons eligible to participate in the Plan are as follows:

(i) Employees,

(ii) non-employee members of the Board or the non-employee members of the board of directors of any Parent or Subsidiary, and

(iii) consultants and other independent advisors who provide services to the Corporation (or any Parent or Subsidiary).

B. The Plan Administrator shall have full authority to determine, (i) with respect to the grants made under the Option Grant Program, which eligible persons are to receive such grants, the time or times when those grants are to be made, the number of shares to be covered by each such grant, the status of the granted option as either an Incentive Option or a Non-Statutory Option, the time or times when each option is to become exercisable, the vesting schedule (if any) applicable to the option shares and the maximum term for which the option is to remain outstanding, and (ii) with respect to stock issuances made under the Stock Issuance Program, which eligible persons are to receive such issuances, the time or times when those issuances are to be made, the number of shares to be issued to each Participant, the vesting schedule (if any) applicable to the issued shares and the consideration to be paid by the Participant for such shares.

C. The Plan Administrator shall have the absolute discretion either to grant options in accordance with the Option Grant Program or to effect stock issuances in accordance with the Stock Issuance Program.

V. STOCK SUBJECT TO THE PLAN

A. The stock issuable under the Plan shall be shares of authorized but unissued or reacquired Common Stock. The maximum number of shares of Common Stock which may be issued over the term of the Plan shall not exceed Fifty-One Million Two Hundred Seven Thousand Six Hundred Ninety-Six (51,207,696) shares. Such share reserve is comprised of (i) the 3,000,000 shares of Common Stock initially authorized for issuance under the Plan, plus (ii) an additional increase of 2,467,000 shares of Common Stock authorized by the Board on September 20, 2000 and approved by the stockholders on September 20, 2000, plus (iii) an additional increase of 5,775,696 shares of Common Stock authorized by the Board on May 23, 2002 and approved by the stockholders on May 23, 2002, plus (iv) an additional

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increase of 440,000 shares of Common Stock authorized by the Board on December 13, 2002 and approved by the stockholders on December 13, 2002, plus (v) an additional increase of 400,000 shares of Common Stock authorized by the Board on January 14, 2003 and approved by the stockholders on January 23, 2003, plus (vi) an additional 4,000,000 shares of Common Stock authorized by the Board on January 23, 2003 and approved by the stockholders on January 23, 2003, plus (vii) an additional increase of 3,700,000 shares of Common Stock authorized by the Board on March 11, 2003 and approved by the stockholders on April 30, 2003, plus (viii) an additional increase of 7,500,000 shares of Common Stock authorized by the Board on October 13, 2004 and approved by the stockholders on October 13, 2004, plus (ix) an additional increase of 6,925,000 shares of Common Stock authorized by the Board on November 4, 2005 and approved by the stockholders on November 7, 2005, plus (x) an additional increase of 5,000,000 shares of Common Stock authorized by the Board on May 9, 2006 and approved by the stockholders on June 9, 2006, plus (xi) an additional increase of 12,000,000 shares of Common Stock authorized by the Board on June 13, 2007 and approved by the stock holders on June 14, 2007.

B. Shares of Common Stock subject to outstanding options shall be available for subsequent issuance under the Plan to the extent (i) the options expire or terminate for any reason prior to exercise in full or (ii) the options are cancelled in accordance with the cancellation-regrant provisions of Article Two. Unvested shares issued under the Plan and subsequently repurchased by the Corporation, at a price per share not greater than the option exercise or direct issue price paid per share, pursuant to the Corporation’s repurchase rights under the Plan shall be added back to the number of shares of Common Stock reserved for issuance under the Plan and shall accordingly be available for reissuance through one or more subsequent option grants or direct stock issuances under the Plan.

C. Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of consideration, appropriate and proportionate adjustments shall be made to (i) the maximum number and/or class of securities issuable under the Plan and (ii) the number and/or class of securities and the exercise price per share in effect under each outstanding option in order to prevent the dilution or enlargement of benefits thereunder. The adjustments determined by the Plan Administrator shall be final, binding and conclusive. In no event shall any such adjustments be made in connection with the conversion of one or more outstanding shares of the Corporation’s preferred stock into shares of Common Stock.

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ARTICLE TWO

OPTION GRANT PROGRAM

I. OPTION TERMS

Each option shall be evidenced by one or more documents in the form approved by the Plan Administrator; provided, however, that each such document shall comply with the terms specified below. Each document evidencing an Incentive Option shall, in addition, be subject to the provisions of the Plan applicable to such options.

A. Exercise Price.

1. The exercise price per share shall be fixed by the Plan Administrator in accordance with the following provisions:

(i) The exercise price per share shall not be less than eighty-five percent (85%) of the Fair Market Value per share of Common Stock on the option grant date.

(ii) If the person to whom the option is granted is a 10% Stockholder, then the exercise price per share shall not be less than one hundred ten percent (110%) of the Fair Market Value per share of Common Stock on the option grant date.

2. The exercise price shall become immediately due upon exercise of the option and shall, subject to the provisions of Section I of Article Four and the documents evidencing the option, be payable in cash or check made payable to the Corporation. Should the Common Stock be registered under Section 12 of the 1934 Act at the time the option is exercised, then the exercise price may also be paid as follows:

(i) in shares of Common Stock held for the requisite period necessary to avoid a charge to the Corporation’s earnings for financial reporting purposes and valued at Fair Market Value on the Exercise Date, or

(ii) to the extent the option is exercised for vested shares, through a special sale and remittance procedure pursuant to which the Optionee shall concurrently provide irrevocable instructions (A) to a brokerage firm (reasonably satisfactory to the Corporation for purposes of administering such procedure) to effect the immediate sale of the purchased shares and remit to the Corporation, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate exercise price payable for the purchased shares plus all applicable Federal, state and local income and employment taxes required to be withheld by the Corporation by reason of such exercise and (B) to

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the Corporation to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete the sale.

Except to the extent such sale and remittance procedure is utilized, payment of the exercise price for the purchased shares must be made on the Exercise Date.

B. Exercise and Term of Options. Each option shall be exercisable at such time or times, during such period and for such number of shares as shall be determined by the Plan Administrator and set forth in the documents evidencing the option grant. However, no option shall have a term in excess of ten (10) years measured from the option grant date.

C. Effect of Termination of Service.

1. The following provisions shall govern the exercise of any options held by the Optionee at the time of cessation of Service or death:

(i) Should the Optionee cease to remain in Service for any reason other than death, Disability or Misconduct, then the Optionee shall have a period of three (3) months following the date of such cessation of Service during which to exercise each outstanding option held by such Optionee.

(ii) Should Optionee’s Service terminate by reason of Disability, then the Optionee shall have a period of twelve (12) months following the date of such cessation of Service during which to exercise each outstanding option held by such Optionee.

(iii) If the Optionee dies while holding an outstanding option, then the personal representative of his or her estate or the person or persons to whom the option is transferred pursuant to the Optionee’s will or the laws of inheritance or the Optionee’s designated beneficiary or beneficiaries of that option shall have a twelve (12)-month period following the date of the Optionee’s death to exercise such option.

(iv) For options granted on or after June 13, 2007, if the exercise of the option following the termination of the Optionee’s Service (other than upon the Optionee’s death, Disability or Misconduct) would either (i) be prohibited at any time solely because the issuance of shares of Common Stock would violate the registration requirements under the Securities Act of 1933, as amended, or (ii) subject the Optionee to short-swing liability under Section 16(b) of the 1934 Act, then the option shall terminate on the expiration of a period of three (3) months after the termination of the Optionee’s Service during which the exercise of the option would not be in violation of such registration requirements and would not subject the Optionee to short-swing liability under Section 16(b) of the 1934 Act.

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(v) Under no circumstances, however, shall any such option be exercisable after the specified expiration of the option term.

(vi) During the applicable post-Service exercise period, the option may not be exercised in the aggregate for more than the number of vested shares for which the option is exercisable on the date of the Optionee’s cessation of Service. Upon the expiration of the applicable exercise period or (if earlier) upon the expiration of the option term, the option shall terminate and cease to be outstanding for any vested shares for which the option has not been exercised. However, the option shall, immediately upon the Optionee’s cessation of Service, terminate and cease to be outstanding with respect to any and all option shares for which the option is not otherwise at the time exercisable or in which the Optionee is not otherwise at that time vested.

(vii) Should Optionee’s Service be terminated for Misconduct or should Optionee otherwise engage in Misconduct while holding one or more outstanding options under the Plan, then all those options shall terminate immediately and cease to remain outstanding.

2. The Plan Administrator shall have the discretion, exercisable either at the time an option is granted or at any time while the option remains outstanding, to:

(i) extend the period of time for which the option is to remain exercisable following Optionee’s cessation of Service or death from the limited period otherwise in effect for that option to such greater period of time as the Plan Administrator shall deem appropriate, but in no event beyond the expiration of the option term, and/or

(ii) permit the option to be exercised, during the applicable post-Service exercise period, not only with respect to the number of vested shares of Common Stock for which such option is exercisable at the time of the Optionee’s cessation of Service but also with respect to one or more additional installments in which the Optionee would have vested under the option had the Optionee continued in Service.

D. Stockholder Rights. The holder of an option shall have no stockholder rights with respect to the shares subject to the option until such person shall have exercised the option, paid the exercise price and become the recordholder of the purchased shares.

E. Unvested Shares. The Plan Administrator shall have the discretion to grant options which are exercisable for unvested shares of Common Stock. Should the Optionee cease Service while holding such unvested shares, the Corporation shall have the right to repurchase, any or all of those unvested shares at a price share equal to the lower of (i) the exercise price paid per share, or (ii) the Fair Market Value per share of Common Stock at the time of Optionee’s cessation of Service. The terms upon which such repurchase right shall be exercisable (including the period and procedure for exercise and the appropriate vesting schedule

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for the purchased shares) shall be established by the Plan Administrator and set forth in the document evidencing such repurchase right. The Plan Administrator may not impose a vesting schedule upon any option grant or the shares of Common Stock subject to that option which is more restrictive than twenty percent (20%) per year vesting, with the initial vesting to occur not later than one (1) year after the option grant date. However, such limitation shall not be applicable to any option grants made to individuals who are officers of the Corporation, non-employee Board members or independent consultants.

F. First Refusal Rights. Until such time as the Common Stock is first registered under Section 12 of the 1934 Act, the Corporation shall have the right of first refusal with respect to any proposed disposition by the Optionee (or any successor in interest) of any shares of Common Stock issued under the Plan. Such right of first refusal shall be exercisable in accordance with the terms established by the Plan Administrator and set forth in the document evidencing such right.

G. Limited Transferability of Options. An Incentive Stock Option shall be exercisable only by the Optionee during his or her lifetime and shall not be assignable or transferable other than by will or by the laws of inheritance following the Optionee’s death. A Non-Statutory Option may be assigned in whole or in part during the Optionee’s lifetime to one or more members of the Optionee’s family or to a trust established exclusively for one or more such family members or to Optionee’s former spouse, to the extent such assignment is in connection with the Optionee’s estate plan or pursuant to a domestic relations order. The assigned portion may only be exercised by the person or persons who acquire a proprietary interest in the Non-Statutory Option pursuant to the assignment. The terms applicable to the assigned portion shall be the same as those in effect for the option immediately prior to such assignment and shall be set forth in such documents issued to the assignee as the Plan Administrator may deem appropriate. Notwithstanding the foregoing, the Optionee may also designate one or more persons as the beneficiary or beneficiaries of his or her outstanding options under the Plan, and those options shall, in accordance with such designation, automatically be transferred to such beneficiary or beneficiaries upon the Optionee’s death while holding those options. Such beneficiary or beneficiaries shall take the transferred options subject to all the terms and conditions of the applicable agreement evidencing each such transferred option, including (without limitation) the limited time period during which the option may be exercised following the Optionee’s death.

II. INCENTIVE OPTIONS

The terms specified below shall be applicable to all Incentive Options. Except as modified by the provisions of this Section II, all the provisions of Articles One, Two and Four shall be applicable to Incentive Options. Options which are specifically designated as Non-Statutory Options shall not be subject to the terms of this Section II.

A. Eligibility. Incentive Options may only be granted to Employees.

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B. Exercise Price. The exercise price per share shall not be less than one hundred percent (100%) of the Fair Market Value per share of Common Stock on the option grant date.

C. Dollar Limitation. The aggregate Fair Market Value of the shares of Common Stock (determined as of the respective date or dates of grant) for which one or more options granted to any Employee under the Plan (or any other option plan of the Corporation or any Parent or Subsidiary) may for the first time become exercisable as Incentive Options during any one (1) calendar year shall not exceed the sum of One Hundred Thousand Dollars ($100,000). To the extent the Employee holds two (2) or more such options which become exercisable for the first time in the same calendar year, the foregoing limitation on the exercisability of such options as Incentive Options shall be applied on the basis of the order in which such options are granted.

D. 10% Stockholder. If any Employee to whom an Incentive Option is granted is a 10% Stockholder, then the option term shall not exceed five (5) years measured from the option grant date.

III. CORPORATE TRANSACTION

A. The shares subject to each option outstanding under the Plan at the time of a Corporate Transaction shall automatically vest in full so that each such option shall, immediately prior to the effective date of the Corporate Transaction, become exercisable for all of the shares of Common Stock at the time subject to that option and may be exercised for any or all of those shares as fully-vested shares of Common Stock. However, the shares subject to an outstanding option shall not vest on such an accelerated basis if and to the extent: (i) such option is assumed by the successor corporation (or parent thereof) in the Corporate Transaction and any repurchase rights of the Corporation with respect to the unvested option shares are concurrently assigned to such successor corporation (or parent thereof) or (ii) such option is to be replaced with a cash incentive program of the successor corporation which preserves the spread existing on the unvested option shares at the time of the Corporate Transaction and provides for subsequent payout in accordance with the same vesting schedule applicable to those unvested option shares or (iii) the acceleration of such option is subject to other limitations imposed by the Plan Administrator at the time of the option grant.

B. All outstanding repurchase rights under the Option Grant Program shall also terminate automatically, and the shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of any Corporate Transaction, except to the extent: (i) those repurchase rights are assigned to the successor corporation (or parent thereof) in connection with such Corporate Transaction or (ii) such accelerated vesting is precluded by other limitations imposed by the Plan Administrator at the time the repurchase right is issued.

C. Immediately following the consummation of the Corporate Transaction, all outstanding options shall terminate and cease to be outstanding, except to the extent assumed by the successor corporation (or parent thereof).

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D. Each option which is assumed in connection with a Corporate Transaction shall be appropriately and proportionately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have been issuable to the Optionee in consummation of such Corporate Transaction, had the option been exercised immediately prior to such Corporate Transaction. Appropriate and proportionate adjustments shall also be made to (i) the number and class of securities available for issuance under the Plan following the consummation of such Corporate Transaction and (ii) the exercise price payable per share under each outstanding option, provided the aggregate exercise price payable for such securities shall remain the same. To the extent the actual holders of the Corporation’s outstanding Common Stock receive cash consideration for their Common Stock in consummation of the Corporate Transaction, the successor corporation may, in connection with the assumption of the outstanding options under this Plan, substitute one or more shares of its own common stock with a fair market value equivalent to the cash consideration paid per share of Common Stock in such Corporate Transaction.

E. The Plan Administrator shall have the discretion, exercisable either at the time the option is granted or at any time while the option remains outstanding, to structure one or more options so that those options shall automatically accelerate and vest in full (and any repurchase rights of the Corporation with respect to the unvested shares subject to those options shall immediately terminate) upon the occurrence of a Corporate Transaction, whether or not those options are to be assumed in the Corporate Transaction.

F. The Plan Administrator shall also have full power and authority, exercisable either at the time the option is granted or at any time while the option remains outstanding, to structure such option so that the shares subject to that option will automatically vest on an accelerated basis should the Optionee’s Service terminate by reason of an Involuntary Termination within a designated period (not to exceed eighteen (18) months) following the effective date of any Corporate Transaction in which the option is assumed and the repurchase rights applicable to those shares do not otherwise terminate. Any option so accelerated shall remain exercisable for the fully-vested option shares until the expiration or sooner termination of the option term. In addition, the Plan Administrator may provide that one or more of the Corporation’s outstanding repurchase rights with respect to shares held by the Optionee at the time of such Involuntary Termination shall immediately terminate on an accelerated basis, and the shares subject to those terminated rights shall accordingly vest at that time.

G. The portion of any Incentive Option accelerated in connection with a Corporate Transaction shall remain exercisable as an Incentive Option only to the extent the applicable One Hundred Thousand Dollar limitation is not exceeded. To the extent such dollar limitation is exceeded, the accelerated portion of such option shall be exercisable as a Non-Statutory Option under the Federal tax laws.

H. The grant of options under the Plan shall in no way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

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IV. CANCELLATION AND REGRANT OF OPTIONS

The Plan Administrator shall have the authority to effect, at any time and from time to time, with the consent of the affected option holders, the cancellation of any or all outstanding options under the Plan and to grant in substitution therefor new options covering the same or different number of shares of Common Stock but with an exercise price per share based on the Fair Market Value per share of Common Stock on the new option grant date.

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ARTICLE THREE

STOCK ISSUANCE PROGRAM

I. STOCK ISSUANCE TERMS

Shares of Common Stock may be issued under the Stock Issuance Program through direct and immediate issuances without any intervening option grants. Each such stock issuance shall be evidenced by a Stock Issuance Agreement which complies with the terms specified below.

A. Purchase Price.

1. The purchase price per share shall be fixed by the Plan Administrator but shall not be less than eighty-five percent (85%) of the Fair Market Value per share of Common Stock on the issue date. However, the purchase price per share of Common Stock issued to a 10% Stockholder shall not be less than one hundred and ten percent (110%) of such Fair Market Value.

2. Subject to the provisions of Section I of Article Four, shares of Common Stock may be issued under the Stock Issuance Program for any of the following items of consideration which the Plan Administrator may deem appropriate in each individual instance:

(i) cash or check made payable to the Corporation, or

(ii) past or future services rendered to the Corporation (or any Parent or Subsidiary).

B. Vesting Provisions.

1. Shares of Common Stock issued under the Stock Issuance Program may, in the discretion of the Plan Administrator, be fully and immediately vested upon issuance or may vest in one or more installments over the Participant’s period of Service or upon attainment of specified performance objectives. However, the Plan Administrator may not impose a vesting schedule upon any stock issuance effected under the Stock Issuance Program which is more restrictive than twenty percent (20%) per year vesting, with initial vesting to occur not later than one (1) year after the issuance date. Such limitation shall not apply to any Common Stock issuances made to the officers of the Corporation, non-employee Board members or independent consultants.

2. Any new, substituted or additional securities or other property (including money paid other than as a regular cash dividend) which the Participant may have the right to receive with respect to the Participant’s unvested shares of Common Stock by reason of any stock dividend, stock split, recapitalization, combination of shares, exchange of shares or

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other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of consideration shall be issued subject to (i) the same vesting requirements applicable to the Participant’s unvested shares of Common Stock and (ii) such escrow arrangements as the Plan Administrator shall deem appropriate.

3. The Participant shall have full stockholder rights with respect to any shares of Common Stock issued to the Participant under the Stock Issuance Program, whether or not the Participant’s interest in those shares is vested. Accordingly, the Participant shall have the right to vote such shares and to receive any regular cash dividends paid on such shares.

4. Should the Participant cease to remain in Service while holding one or more unvested shares of Common Stock issued under the Stock Issuance Program or should the performance objectives not be attained with respect to one or more such unvested shares of Common Stock, then those shares shall be immediately surrendered to the Corporation for cancellation, and the Participant shall have no further stockholder rights with respect to those shares. To the extent the surrendered shares were previously issued to the Participant for consideration paid in cash or cash equivalent (including the Participant’s purchase-money indebtedness), the Corporation shall repay to the Participant the lower of (i) the cash consideration paid for the surrendered shares, or (ii) the Fair Market Value of those shares at the time of the Participant’s cessation of Service, and shall cancel the unpaid principal balance of any outstanding purchase-money note of the Participant attributable to such surrendered shares by the applicable clause (i) or (ii) amount.

5. The Plan Administrator may in its discretion waive the surrender and cancellation of one or more unvested shares of Common Stock (or other assets attributable thereto) which would otherwise occur upon the non-completion of the vesting schedule applicable to those shares. Such waiver shall result in the immediate vesting of the Participant’s interest in the shares of Common Stock as to which the waiver applies. Such waiver may be effected at any time, whether before or after the Participant’s cessation of Service or the attainment or non-attainment of the applicable performance objectives.

C. First Refusal Rights. Until such time as the Common Stock is first registered under Section 12 of the 1934 Act, the Corporation shall have the right of first refusal with respect to any proposed disposition by the Participant (or any successor in interest) of any shares of Common Stock issued under the Stock Issuance Program. Such right of first refusal shall be exercisable in accordance with the terms established by the Plan Administrator and set forth in the document evidencing such right.

II. CORPORATE TRANSACTION

A. Upon the occurrence of a Corporate Transaction, all outstanding repurchase rights under the Stock Issuance Program shall terminate automatically, and the shares of Common Stock subject to those terminated rights shall immediately vest in full, except to the extent: (i) those repurchase rights are assigned to the successor corporation (or parent thereof) in

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connection with such Corporate Transaction or (ii) such accelerated vesting is precluded by other limitations imposed by the Plan Administrator at the time the repurchase right is issued.

B. The Plan Administrator shall have the discretionary authority, exercisable either at the time the unvested shares are issued or any time while the Corporation’s repurchase rights with respect to those shares remain outstanding, to provide that those rights shall automatically terminate on an accelerated basis, and the shares of Common Stock subject to those terminated rights shall immediately vest, in the event the Participant’s Service should subsequently terminate by reason of an Involuntary Termination within a designated period (not to exceed eighteen (18) months) following the effective date of any Corporate Transaction in which those repurchase rights are assigned to the successor corporation (or parent thereof).

III. SHARE ESCROW/LEGENDS

Unvested shares may, in the Plan Administrator’s discretion, be held in escrow by the Corporation until the Participant’s interest in such shares vests or may be issued directly to the Participant with restrictive legends on the certificates evidencing those unvested shares.

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ARTICLE FOUR

MISCELLANEOUS

I. FINANCING

The Plan Administrator may permit any Optionee or Participant to pay the option exercise price under the Option Grant Program or the purchase price for shares issued under the Stock Issuance Program by delivering a full-recourse, interest bearing promissory note payable in one or more installments and secured by the purchased shares. In no event, however, may the maximum credit available to the Optionee or Participant exceed the sum of (i) the aggregate option exercise price or purchase price payable for the purchased shares (less the par value of those shares) plus (ii) any Federal, state and local income and employment tax liability incurred by the Optionee or the Participant in connection with the option exercise or share purchase.

II. EFFECTIVE DATE AND TERM OF PLAN

A. The Plan shall become effective when adopted by the Board, but no option granted under the Plan may be exercised, and no shares shall be issued under the Plan, until the Plan is approved by the Corporation’s stockholders. If such stockholder approval is not obtained within twelve (12) months after the date of the Board’s adoption of the Plan, then all options previously granted under the Plan shall terminate and cease to be outstanding, and no further options shall be granted and no shares shall be issued under the Plan. Subject to such limitation, the Plan Administrator may grant options and issue shares under the Plan at any time after the effective date of the Plan and before the date fixed herein for termination of the Plan.

B. The Plan shall terminate upon the earliest of (i) the expiration of the ten (10)-year period measured from the date the Plan is adopted by the Board, (ii) the date on which all shares available for issuance under the Plan shall have been issued as vested shares or (iii) the termination of all outstanding options in connection with a Corporate Transaction. All options and unvested stock issuances outstanding at the time of a clause (i) termination event shall continue to have full force and effect in accordance with the provisions of the documents evidencing those options or issuances.

III. AMENDMENT OF THE PLAN

A. The Board shall have complete and exclusive power and authority to amend or modify the Plan in any or all respects. However, no such amendment or modification shall adversely affect the rights and obligations with respect to options or unvested stock issuances at the time outstanding under the Plan unless the Optionee or the Participant consents to such amendment or modification. In addition, certain amendments may require stockholder approval pursuant to applicable laws and regulations.

B. Options may be granted under the Option Grant Program and shares may be issued under the Stock Issuance Program which are in each instance in excess of the number

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of shares of Common Stock then available for issuance under the Plan, provided any excess shares actually issued under those programs shall be held in escrow until there is obtained stockholder approval of an amendment sufficiently increasing the number of shares of Common Stock available for issuance under the Plan. If such stockholder approval is not obtained within twelve (12) months after the date the first such excess grants or issuances are made, then (i) any unexercised options granted on the basis of such excess shares shall terminate and cease to be outstanding and (ii) the Corporation shall promptly refund to the Optionees and the Participants the exercise or purchase price paid for any excess shares issued under the Plan and held in escrow, together with interest (at the applicable Short Term Federal Rate) for the period the shares were held in escrow, and such shares shall thereupon be automatically cancelled and cease to be outstanding.

IV. USE OF PROCEEDS

Any cash proceeds received by the Corporation from the sale of shares of Common Stock under the Plan shall be used for general corporate purposes.

V. WITHHOLDING

The Corporation’s obligation to deliver shares of Common Stock upon the exercise of any options granted under the Plan or upon the issuance or vesting of any shares issued under the Plan shall be subject to the satisfaction of all applicable Federal, state and local income and employment tax withholding requirements.

VI. REGULATORY APPROVALS

The implementation of the Plan, the granting of any options under the Plan and the issuance of any shares of Common Stock (i) upon the exercise of any option or (ii) under the Stock Issuance Program shall be subject to the Corporation’s procurement of all approvals and permits required by regulatory authorities having jurisdiction over the Plan, the options granted under it and the shares of Common Stock issued pursuant to it.

VII. NO EMPLOYMENT OR SERVICE RIGHTS

Nothing in the Plan shall confer upon the Optionee or the Participant any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Parent or Subsidiary employing or retaining such person) or of the Optionee or the Participant, which rights are hereby expressly reserved by each, to terminate such person’s Service at any time for any reason, with or without cause.

VIII. FINANCIAL REPORTS

The Corporation shall deliver a balance sheet and an income statement at least annually to each individual holding an outstanding option under the Plan, unless such individual is a key Employee whose duties in connection with the Corporation (or any Parent or Subsidiary) assure such individual access to equivalent information.

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APPENDIX

The following definitions shall be in effect under the Plan:

A. Board shall mean the Corporation’s Board of Directors.

B. Code shall mean the Internal Revenue Code of 1986, as amended.

C. Committee shall mean a committee of one (1) or more Board members appointed by the Board to exercise one or more administrative functions under the Plan.

D. Common Stock shall mean the Corporation’s common stock.

E. Corporate Transaction shall mean either of the following stockholder-approved transactions to which the Corporation is a party:

(i) a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction, or

(ii) the sale, transfer or other disposition of all or substantially all of the Corporation’s assets in complete liquidation or dissolution of the Corporation.

F. Corporation shall mean Danger, Inc., a Delaware corporation, and any successor corporation to all or substantially all of the assets or voting stock of Danger, Inc. which shall by appropriate action adopt the Plan.

G. Disability shall mean the inability of the Optionee or the Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment and shall be determined by the Plan Administrator on the basis of such medical evidence as the Plan Administrator deems warranted under the circumstances.

H. Employee shall mean an individual who is in the employ of the Corporation (or any Parent or Subsidiary), subject to the control and direction of the employer entity as to both the work to be performed and the manner and method of performance.

I. Exercise Date shall mean the date on which the Corporation shall have received written notice of the option exercise.

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J. Fair Market Value per share of Common Stock on any relevant date shall be determined in accordance with the following provisions:

(i) If the Common Stock is at the time traded on the Nasdaq National Market, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question, as such price is reported by the National Association of Securities Dealers on the Nasdaq National Market and published in The Wall Street Journal. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists.

(ii) If the Common Stock is at the time listed on any Stock Exchange, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question on the Stock Exchange determined by the Plan Administrator to be the primary market for the Common Stock, as such price is officially quoted in the composite tape of transactions on such exchange and published in The Wall Street Journal. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists.

(iii) If the Common Stock is at the time neither listed on any Stock Exchange nor traded on the Nasdaq National Market, then the Fair Market Value shall be determined by the Plan Administrator after taking into account such factors as the Plan Administrator shall deem appropriate.

K. Incentive Option shall mean an option which satisfies the requirements of Code Section 422.

L. Involuntary Termination shall mean the termination of the Service of any individual which occurs by reason of:

(i) such individual’s involuntary dismissal or discharge by the Corporation for reasons other than Misconduct, or

(ii) such individual’s voluntary resignation following (A) a change in his or her position with the Corporation which materially reduces his or her duties and responsibilities or the level of management to which he or she reports, (B) a reduction in his or her level of compensation (including base salary, fringe benefits and target bonus under any corporate-performance based bonus or incentive programs) by more than fifteen percent (15%) or (C) a relocation of such individual’s place of employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is effected without the individual’s consent.

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M. Misconduct shall mean the commission of any act of fraud, embezzlement or dishonesty by the Optionee or Participant, any unauthorized use or disclosure by such person of confidential information or trade secrets of the Corporation (or any Parent or Subsidiary), or any other intentional misconduct by such person adversely affecting the business or affairs of the Corporation (or any Parent or Subsidiary) in a material manner. The foregoing definition shall not in any way preclude or restrict the right of the Corporation (or any Parent or Subsidiary) to discharge or dismiss any Optionee, Participant or other person in the Service of the Corporation (or any Parent or Subsidiary) for any other acts or omissions, but such other acts or omissions shall not be deemed, for purposes of the Plan, to constitute grounds for termination for Misconduct.

N. 1934 Act shall mean the Securities Exchange Act of 1934, as amended.

O. Non-Statutory Option shall mean an option not intended to satisfy the requirements of Code Section 422.

P. Option Grant Program shall mean the option grant program in effect under the Plan.

Q. Optionee shall mean any person to whom an option is granted under the Plan.

R. Parent shall mean any corporation (other than the Corporation) in an unbroken chain of corporations ending with the Corporation, provided each corporation in the unbroken chain (other than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

S. Participant shall mean any person who is issued shares of Common Stock under the Stock Issuance Program.

T. Plan shall mean the Corporation’s 2000 Stock Option/Stock Issuance Plan, as set forth in this document.

U. Plan Administrator shall mean either the Board or the Committee acting in its capacity as administrator of the Plan.

V. Service shall mean the provision of services to the Corporation (or any Parent or Subsidiary) by a person in the capacity of an Employee, a non-employee member of the board of directors or a consultant or independent advisor, except to the extent otherwise specifically provided in the documents evidencing the option grant.

W. Stock Exchange shall mean either the American Stock Exchange or the New York Stock Exchange.

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X. Stock Issuance Agreement shall mean the agreement entered into by the Corporation and the Participant at the time of issuance of shares of Common Stock under the Stock Issuance Program.

Y. Stock Issuance Program shall mean the stock issuance program in effect under the Plan.

Z. Subsidiary shall mean any corporation (other than the Corporation) in an unbroken chain of corporations beginning with the Corporation, provided each corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

AA. 10% Stockholder shall mean the owner of stock (as determined under Code Section 424(d)) possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Corporation (or any Parent or Subsidiary).

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EX-10.15

EXHIBIT 10.15

DANGER, INC.

STOCK OPTION AGREEMENT

RECITALS

A. The Board has adopted the Plan for the purpose of retaining the services of selected Employees, non-employee members of the Board or the board of directors of any Parent or Subsidiary and consultants and other independent advisors in the service of the Corporation (or any Parent or Subsidiary).

B. Optionee is to render valuable services to the Corporation (or a Parent or Subsidiary), and this Agreement is executed pursuant to, and is intended to carry out the purposes of, the Plan in connection with the Corporation’s grant of an option to Optionee.

C. All capitalized terms in this Agreement shall have the meaning assigned to them in the attached Appendix.

NOW, THEREFORE, it is hereby agreed as follows:

1. Grant of Option. The Corporation hereby grants to Optionee, as of the Grant Date, an option to purchase up to the number of Option Shares specified in the Grant Notice. The Option Shares shall be purchasable from time to time during the option term specified in Paragraph 2 at the Exercise Price.

2. Option Term. This option shall have a term of ten (10) years measured from the Grant Date and shall accordingly expire at the close of business on the Expiration Date, unless sooner terminated in accordance with Paragraph 5 or 6.

3. Limited Transferability.

(a) This option shall be neither transferable nor assignable by Optionee other than by will or the laws of inheritance following Optionee’s death and may be exercised, during Optionee’s lifetime, only by Optionee. However, Optionee may designate one or more persons as the beneficiary or beneficiaries of this option, and this option shall, in accordance with such designation, automatically be transferred to such beneficiary or beneficiaries upon the Optionee’s death while holding this option. Such beneficiary or beneficiaries shall take the transferred option subject to all the terms and conditions of this Agreement, including (without limitation) the limited time period during which this option may, pursuant to Paragraph 5, be exercised following Optionee’s death.

(b) If this option is designated a Non-Statutory Option in the Grant Notice, then this option may be assigned in whole or in part during Optionee’s lifetime to one or more members of Optionee’s family or to a trust established for the exclusive benefit of one or more such family members or to Optionee’s former spouse, to the extent such assignment is in connection with the Optionee’s estate plan or pursuant to a domestic relations order. The

assigned portion shall be exercisable only by the person or persons who acquire a proprietary interest in the option pursuant to such assignment. The terms applicable to the assigned portion shall be the same as those in effect for this option immediately prior to such assignment.

4. Dates of Exercise. This option shall become exercisable for the Option Shares in one or more installments as specified in the Grant Notice. As the option becomes exercisable for such installments, those installments shall accumulate, and the option shall remain exercisable for the accumulated installments until the Expiration Date or sooner termination of the option term under Paragraph 5 or 6.

5. Cessation of Service. The option term specified in Paragraph 2 shall terminate (and this option shall cease to be outstanding) prior to the Expiration Date should any of the following provisions become applicable:

(a) Should Optionee cease to remain in Service for any reason (other than death, Disability or Misconduct) while this option is outstanding, then Optionee (or any person or persons to whom this option is transferred pursuant to a permitted transfer under Paragraph 3) shall have a period of three (3) months (commencing with the date of such cessation of Service) during which to exercise this option, but in no event shall this option be exercisable at any time after the Expiration Date.

(b) Should Optionee die while this option is outstanding, then the personal representative of Optionee’s estate or the person or persons to whom the option is transferred pursuant to Optionee’s will or the laws of inheritance following Optionee’s death or to whom the option is transferred during Optionee’s lifetime pursuant to a permitted transfer under Paragraph 3 shall have the right to exercise this option. However, if Optionee dies while holding this option and has an effective beneficiary designation in effect for this option at the time of his or her death, then the designated beneficiary or beneficiaries shall have the exclusive right to exercise this option following Optionee’s death. Any such right to exercise this option shall lapse, and this option shall cease to be outstanding, upon the earlier of (i) the expiration of the twelve (12)-month period measured from the date of Optionee’s death or (ii) the Expiration Date.

(c) Should Optionee cease Service by reason of Disability while this option is outstanding, then Optionee (or any person or persons to whom this option is transferred pursuant to a permitted transfer under Paragraph 3) shall have a period of twelve (12) months (commencing with the date of such cessation of Service) during which to exercise this option. In no event shall this option be exercisable at any time after the Expiration Date.

Note: Exercise of this option on a date later than three (3) months following cessation of Service due to Disability will result in loss of favorable Incentive Option treatment, unless such Disability constitutes Permanent Disability. In the event that Incentive Option treatment is not available, this option will be taxed as a Non-Statutory Option upon exercise.

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(d) During the limited period of post-Service exercisability, this option may not be exercised in the aggregate for more than the number of Option Shares in which Optionee is, at the time of Optionee’s cessation of Service, vested pursuant to the Vesting Schedule specified in the Grant Notice or the special vesting acceleration provisions of Paragraph 6. No additional Option Shares shall vest, whether pursuant to the normal Vesting Schedule specified in the Grant Notice or the special vesting acceleration provisions of Paragraph 6, following the Optionee’s cessation of Service, except to the extent (if any) specifically authorized by the Plan Administrator pursuant to an express written agreement with the Optionee. Upon the expiration of such limited exercise period or (if earlier) upon the Expiration Date, this option shall terminate and cease to be outstanding for any vested Option Shares for which the option has not been exercised.

(e) Should Optionee’s Service be terminated for Misconduct or should Optionee otherwise engage in Misconduct while this option is outstanding, then this option shall terminate immediately and cease to remain outstanding.

(f) If the exercise of this option following the termination of the Optionee’s Service (other than upon the Optionee’s death, Disability or Misconduct) would either (i) be prohibited at any time solely because the issuance of shares of Common Stock would violate the registration requirements under the Securities Act of 1933, as amended, or (ii) subject the Optionee to short-swing liability under Section 16(b) of the 1934 Act, then this option shall terminate on the earlier of (A) the expiration of a period of three (3) months after the termination of the Optionee’s Service during which the exercise of the option would not be in violation of such registration requirements and would not subject the Optionee to short-swing liability under Section 16(b) of the 1934 Act, or (B) the Expiration Date.

Note: Exercise of this option on a date later than three (3) months following cessation of Service will result in loss of favorable Incentive Option treatment. In the event that Incentive Option treatment is not available, this option will be taxed as a Non-Statutory Option upon exercise.

6. Accelerated Vesting.

(a) In the event of any Corporate Transaction, the Option Shares at the time subject to this option but not otherwise vested shall automatically vest in full so that this option shall, immediately prior to the effective date of the Corporate Transaction, become exercisable for all of the Option Shares as fully-vested shares and may be exercised for any or all of those Option Shares as vested shares. However, the Option Shares shall not vest on such an accelerated basis if and to the extent: (i) this option is assumed by the successor corporation (or parent thereof) in the Corporate Transaction and the Corporation’s repurchase rights with respect to the unvested Option Shares are assigned to such successor corporation (or parent thereof) or (ii) this option is to be replaced with a cash incentive program of the successor corporation which preserves the spread existing on the unvested Option Shares at the time of the Corporate Transaction (the excess of the Fair Market Value of those Option Shares over the Exercise Price

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payable for such shares) and provides for subsequent payout in accordance with the same Vesting Schedule applicable to those unvested Option Shares as set forth in the Grant Notice.

(b) Immediately following the Corporate Transaction, this option shall terminate and cease to be outstanding, except to the extent assumed by the successor corporation (or parent thereof) in connection with the Corporate Transaction.

(c) If this option is assumed in connection with a Corporate Transaction, then this option shall be appropriately and proportionately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have been issuable to Optionee in consummation of such Corporate Transaction had the option been exercised immediately prior to such Corporate Transaction, and appropriate and proportionate adjustments shall also be made to the Exercise Price, provided the aggregate Exercise Price shall remain the same. To the extent the actual holders of the Corporation’s outstanding Common Stock receive cash consideration for their Common Stock in consummation of the Corporate Transaction, the successor corporation may, in connection with the assumption of this option, substitute one or more shares of its own common stock with a fair market value equivalent to the cash consideration paid per share of Common Stock in such Corporate Transaction.

(d) This Agreement shall not in any way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

7. Adjustment in Option Shares. Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of consideration, appropriate and proportionate adjustments shall be made to (i) the total number and/or class of securities subject to this option and (ii) the Exercise Price in order to reflect such change and thereby preclude a dilution or enlargement of benefits hereunder.

8. Stockholder Rights. The holder of this option shall not have any stockholder rights with respect to the Option Shares until such person shall have exercised the option, paid the Exercise Price and become the record holder of the purchased shares.

9. Manner of Exercising Option.

(a) In order to exercise this option with respect to all or any part of the Option Shares for which this option is at the time exercisable, Optionee (or any other person or persons exercising the option) must take the following actions:

(i) Execute and deliver to the Corporation a Purchase Agreement for the Option Shares for which the option is exercised.

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(ii) Pay the aggregate Exercise Price for the purchased shares in one or more of the following forms:

(A) cash or check made payable to the Corporation; or

(B) a promissory note payable to the Corporation, but only to the extent authorized by the Plan Administrator in accordance with Paragraph 14.

Should the Common Stock be registered under Section 12 of the 1934 Act at the time the option is exercised, then the Exercise Price may also be paid as follows:

(C) in shares of Common Stock held by Optionee (or any other person or persons exercising the option) for the requisite period necessary to avoid a charge to the Corporation’s earnings for financial reporting purposes and valued at Fair Market Value on the Exercise Date; or

(D) to the extent the option is exercised for vested Option Shares, through a special sale and remittance procedure pursuant to which Optionee (or any other person or persons exercising the option) shall concurrently provide irrevocable instructions (a) to a brokerage firm (reasonably satisfactory to the Corporation for purposes of administering such procedure in compliance with any applicable pre-clearance or pre-notification requirements) to effect the immediate sale of the purchased shares and remit to the Corporation, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate Exercise Price payable for the purchased shares plus all applicable Federal, state and local income and employment taxes required to be withheld by the Corporation by reason of such exercise and (b) to the Corporation to deliver the certificates for the purchased shares directly to such brokerage firm on such settlement date in order to complete the sale.

Except to the extent the sale and remittance procedure is utilized in connection with the option exercise, payment of the Exercise Price must accompany the Purchase Agreement delivered to the Corporation in connection with the option exercise.

(iii) Furnish to the Corporation appropriate documentation that the person or persons exercising the option (if other than Optionee) have the right to exercise this option.

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(iv) Execute and deliver to the Corporation such written representations as may be requested by the Corporation in order for it to comply with the applicable requirements of Federal and state securities laws.

(v) Make appropriate arrangements with the Corporation (or Parent or Subsidiary employing or retaining Optionee) for the satisfaction of all Federal, state and local income and employment tax withholding requirements applicable to the option exercise.

(b) As soon as practical after the Exercise Date, the Corporation shall issue to or on behalf of Optionee (or any other person or persons exercising this option) a certificate for the purchased Option Shares, with the appropriate legends affixed thereto.

(c) In no event may this option be exercised for any fractional shares.

10. REPURCHASE RIGHTS. ALL OPTION SHARES ACQUIRED UPON THE EXERCISE OF THIS OPTION SHALL BE SUBJECT TO CERTAIN RIGHTS OF THE CORPORATION AND ITS ASSIGNS TO REPURCHASE THOSE SHARES IN ACCORDANCE WITH THE TERMS SPECIFIED IN THE PURCHASE AGREEMENT.

11. Compliance with Laws and Regulations.

(a) The exercise of this option and the issuance of the Option Shares upon such exercise shall be subject to compliance by the Corporation and Optionee with all applicable requirements of law relating thereto and with all applicable regulations of any stock exchange (or the Nasdaq National Market, if applicable) on which the Common Stock may be listed for trading at the time of such exercise and issuance.

(b) The inability of the Corporation to obtain approval from any regulatory body having authority deemed by the Corporation to be necessary to the lawful issuance and sale of any Common Stock pursuant to this option shall relieve the Corporation of any liability with respect to the non-issuance or sale of the Common Stock as to which such approval shall not have been obtained. The Corporation, however, shall use its best efforts to obtain all such approvals.

12. Successors and Assigns. Except to the extent otherwise provided in Paragraphs 3 and 6, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Corporation and its successors and assigns and Optionee, Optionee’s assigns and the legal representatives, heirs and legatees of Optionee’s estate.

13. Notices. Any notice required to be given or delivered to the Corporation under the terms of this Agreement shall be in writing and addressed to the Corporation at its principal corporate offices. Any notice required to be given or delivered to Optionee shall be in writing and addressed to Optionee at the address indicated below Optionee’s signature line on

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the Grant Notice. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

14. Financing. The Plan Administrator may, in its absolute discretion and without any obligation to do so, permit Optionee to pay the Exercise Price for the purchased Option Shares (to the extent such Exercise Price is in excess of the par value of those shares) by delivering a full-recourse, interest-bearing promissory note secured by those Option Shares. The payment schedule in effect for any such promissory note shall be established by the Plan Administrator in its sole discretion.

15. Construction. This Agreement and the option evidenced hereby are made and granted pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. All decisions of the Plan Administrator with respect to any question or issue arising under the Plan or this Agreement shall be conclusive and binding on all persons having an interest in this option.

16. Governing Law. The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of California without resort to that State’s conflict-of-laws rules.

17. Stockholder Approval. If the Option Shares covered by this Agreement exceed, as of the Grant Date, the number of shares of Common Stock which may be issued under the Plan as last approved by the stockholders, then this option shall be void with respect to such excess shares, unless stockholder approval of an amendment sufficiently increasing the number of shares of Common Stock issuable under the Plan is obtained in accordance with the provisions of the Plan.

18. Additional Terms Applicable to an Incentive Option. In the event this option is designated an Incentive Option in the Grant Notice, the following terms and conditions shall also apply to the grant:

(a) This option shall cease to qualify for favorable tax treatment as an Incentive Option if (and to the extent) this option is exercised for one or more Option Shares: (i) more than three (3) months after the date Optionee ceases to be an Employee for any reason other than death or Permanent Disability or (ii) more than twelve (12) months after the date Optionee ceases to be an Employee by reason of Permanent Disability.

(b) This option shall not become exercisable in the calendar year in which granted if (and to the extent) the aggregate Fair Market Value (determined at the Grant Date) of the Common Stock for which this option would otherwise first become exercisable in such calendar year would, when added to the aggregate value (determined as of the respective date or dates of grant) of the Common Stock and any other securities for which one or more other Incentive Options granted to Optionee prior to the Grant Date (whether under the Plan or any other option plan of the Corporation or any Parent or Subsidiary) first become exercisable during the same calendar year, exceed One Hundred Thousand Dollars ($100,000) in the aggregate. To the extent the exercisability of this option is deferred by reason of the foregoing

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limitation, the deferred portion shall become exercisable in the first calendar year or years thereafter in which the One Hundred Thousand Dollar ($100,000) limitation of this Paragraph 18(b) would not be contravened, but such deferral shall in all events end immediately prior to the effective date of a Corporate Transaction in which this option is not to be assumed, whereupon the option shall become immediately exercisable as a Non-Statutory Option for the deferred portion of the Option Shares.

(c) Should Optionee hold, in addition to this option, one or more other options to purchase Common Stock which become exercisable for the first time in the same calendar year as this option, then the foregoing limitations on the exercisability of such options as Incentive Options shall be applied on the basis of the order in which such options are granted.

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APPENDIX

The following definitions shall be in effect under the Agreement:

A. Agreement shall mean this Stock Option Agreement.

B. Board shall mean the Corporation’s Board of Directors.

C. Code shall mean the Internal Revenue Code of 1986, as amended.

D. Common Stock shall mean the Corporation’s common stock.

E. Corporate Transaction shall mean either of the following stockholder-approved transactions to which the Corporation is a party:

(i) a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction, or

(ii) the sale, transfer or other disposition of all or substantially all of the Corporation’s assets in complete liquidation or dissolution of the Corporation.

F. Corporation shall mean Danger, Inc., a Delaware corporation, and any successor corporation to all or substantially all of the assets or voting stock of Danger, Inc. which shall by appropriate action assume this option.

G. Disability shall mean the inability of Optionee to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment and shall be determined by the Plan Administrator on the basis of such medical evidence as the Plan Administrator deems warranted under the circumstances. Disability shall be deemed to constitute Permanent Disability in the event that such Disability is expected to result in death or has lasted or can be expected to last for a continuous period of twelve (12) months or more.

H. Employee shall mean an individual who is in the employ of the Corporation (or any Parent or Subsidiary), subject to the control and direction of the employer entity as to both the work to be performed and the manner and method of performance.

I. Exercise Date shall mean the date on which the option shall have been exercised in accordance with Paragraph 9 of the Agreement.

J. Exercise Price shall mean the exercise price payable per Option Share as specified in the Grant Notice.

K. Expiration Date shall mean the date on which the option expires as specified in the Grant Notice.

L. Fair Market Value per share of Common Stock on any relevant date shall be determined in accordance with the following provisions:

(i) If the Common Stock is at the time traded on the Nasdaq National Market, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question, as the price is reported by the National Association of Securities Dealers on the Nasdaq National Market and published in The Wall Street Journal. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists.

(ii) If the Common Stock is at the time listed on any Stock Exchange, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question on the Stock Exchange determined by the Plan Administrator to be the primary market for the Common Stock, as such price is officially quoted in the composite tape of transactions on such exchange and published in The Wall Street Journal. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists.

(iii) If the Common Stock is at the time neither listed on any Stock Exchange nor traded on the Nasdaq National Market, then the Fair Market Value shall be determined by the Plan Administrator after taking into account such factors as the Plan Administrator shall deem appropriate.

M. Grant Date shall mean the date of grant of the option as specified in the Grant Notice.

N. Grant Notice shall mean the Notice of Grant of Stock Option accompanying the Agreement, pursuant to which Optionee has been informed of the basic terms of the option evidenced hereby.

O. Incentive Option shall mean an option which satisfies the requirements of Code Section 422.

P. Misconduct shall mean the commission of any act of fraud, embezzlement or dishonesty by Optionee, any unauthorized use or disclosure by Optionee of confidential information or trade secrets of the Corporation (or any Parent or Subsidiary), or any other intentional misconduct by Optionee adversely affecting the business or affairs of the Corporation (or any Parent or Subsidiary) in a material manner. The foregoing definition shall not in any way preclude or restrict the right of the Corporation (or any Parent or Subsidiary) to discharge or dismiss Optionee or any other person in the Service of the Corporation (or any Parent or Subsidiary) for any other acts or omissions, but such other acts or omissions shall not be deemed, for purposes of the Plan or this Agreement, to constitute grounds for termination for Misconduct.

Q. 1934 Act shall mean the Securities Exchange Act of 1934, as amended.

R. Non-Statutory Option shall mean an option not intended to satisfy the requirements of Code Section 422.

S. Option Shares shall mean the number of shares of Common Stock subject to the option.

T. Optionee shall mean the person to whom the option is granted as specified in the Grant Notice.

U. Parent shall mean any corporation (other than the Corporation) in an unbroken chain of corporations ending with the Corporation, provided each corporation in the unbroken chain (other than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

V. Plan shall mean the Corporation’s 2000 Stock Option/Stock Issuance Plan.

W. Plan Administrator shall mean either the Board or a committee of the Board acting in its capacity as administrator of the Plan.

X. Purchase Agreement shall mean the stock purchase agreement in substantially the form of Exhibit B to the Grant Notice.

Y. Service shall mean the Optionee’s performance of services for the Corporation (or any Parent or Subsidiary) in the capacity of an Employee, a non-employee member of the board of directors or an independent consultant.

Z. Stock Exchange shall mean the American Stock Exchange or the New York Stock Exchange.

AA. Subsidiary shall mean any corporation (other than the Corporation) in an unbroken chain of corporations beginning with the Corporation, provided each corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

BB. Vesting Schedule shall mean the vesting schedule specified in the Grant Notice pursuant to which the Optionee is to vest in the Option Shares in a series of installments over his or her period of Service.

DANGER, INC.

NOTICE OF GRANT OF STOCK OPTION

Notice is hereby given of the following option grant (the “Option”) to purchase shares of the Common Stock of Danger, Inc. (the “Corporation”):

Optionee: «Optionee»

Grant Date: «Grant_Date»

Vesting Commencement Date: «VCD»

Exercise Price: $«Ex_Price» per share

Number of Option Shares: «Shares» shares of Common Stock

Expiration Date: «Exp_Date»

Type of Option:	«ISO»	Incentive Stock Option
	«NSO»	Non-Statutory Stock Option

Date Exercisable: Immediately Exercisable

Vesting Schedule: The Option Shares shall initially be unvested and subject to repurchase by the Corporation at the lower of the (i) Exercise Price paid per share, or (ii) the Fair Market Value per share at the time of the Optionee’s cessation of Service. Optionee shall acquire a vested interest in, and the Corporation’s repurchase right shall accordingly lapse with respect to, (i) twenty-five percent (25%) of the Option Shares upon Optionee’s completion of one (1) year of Service measured from the Vesting Commencement Date and (ii) the balance of the Option Shares in a series of thirty-six (36) successive equal monthly installments upon Optionee’s completion of each additional month of Service over the thirty-six (36)-month period measured from the first anniversary of the Vesting Commencement Date. In no event shall any additional Option Shares vest after Optionee’s cessation of Service.

Optionee understands and agrees that the Option is granted subject to and in accordance with the terms of the Danger, Inc. 2000 Stock Option/Stock Issuance Plan (the “Plan”). Optionee further agrees to be bound by the terms of the Plan and the terms of the Option as set forth in the Stock Option Agreement attached hereto as Exhibit A.

Optionee understands that any Option Shares purchased under the Option will be subject to the terms set forth in the Stock Purchase Agreement attached hereto as Exhibit B. Optionee hereby acknowledges receipt of a copy of the Plan in the form attached hereto as Exhibit C.

REPURCHASE RIGHTS. OPTIONEE HEREBY AGREES THAT ALL OPTION SHARES ACQUIRED UPON THE EXERCISE OF THE OPTION SHALL BE SUBJECT TO CERTAIN REPURCHASE RIGHTS AND RIGHTS OF FIRST REFUSAL EXERCISABLE BY THE CORPORATION AND ITS ASSIGNS. THE TERMS OF

SUCH RIGHTS ARE SPECIFIED IN THE ATTACHED STOCK PURCHASE AGREEMENT.

At Will Employment. Nothing in this Notice or in the attached Stock Option Agreement or Plan shall confer upon Optionee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Parent or Subsidiary employing or retaining Optionee) or of Optionee, which rights are hereby expressly reserved by each, to terminate Optionee’s Service at any time for any reason, with or without cause.

Definitions. All capitalized terms in this Notice shall have the meaning assigned to them in this Notice or in the attached Stock Option Agreement.

DATED:                         ,         

DANGER, INC.
By:
Title:
	OPTIONEE
Address:
Phone:

Attachments:

Exhibit A—Stock Option Agreement

Exhibit B—Stock Purchase Agreement

Exhibit C—2000 Stock Option/Stock Issuance Plan

EXHIBIT A

STOCK OPTION AGREEMENT

EXHIBIT B

DANGER, INC.

STOCK PURCHASE AGREEMENT

AGREEMENT made this      day of                     ,          by and between Danger, Inc., a Delaware corporation, and                             , (the “Optionee”) under the Corporation’s 2000 Stock Option/Stock Issuance Plan.

All capitalized terms in this Agreement shall have the meaning assigned to them in this Agreement or in the attached Appendix.

A. EXERCISE OF OPTION

1. Exercise. Optionee hereby purchases                      shares of Common Stock (the “Purchased Shares”) pursuant to that certain option (the “Option”) granted Optionee on                                  (the “Grant Date”) to purchase up to                      shares of Common Stock (the “Option Shares”) under the Plan at the exercise price of $                     per share (the “Exercise Price”).

2. Payment. Concurrently with the delivery of this Agreement to the Corporation, Optionee shall pay the Exercise Price for the Purchased Shares in accordance with the provisions of the Option Agreement and shall deliver whatever additional documents may be required by the Option Agreement as a condition for exercise, together with a duly-executed blank Assignment Separate from Certificate (in the form attached hereto as Exhibit I) with respect to the Purchased Shares.

3. Stockholder Rights. Until such time as the Corporation exercises the Repurchase Right or the First Refusal Right, Optionee (or any successor in interest) shall have all the rights of a stockholder (including voting, dividend and liquidation rights) with respect to the Purchased Shares, subject, however, to the transfer restrictions of Articles B and C.

B. SECURITIES LAW COMPLIANCE

1. Restricted Securities. The Purchased Shares have not been registered under the 1933 Act and are being issued to Optionee in reliance upon the exemption from such registration provided by SEC Rule 701 for stock issuances under compensatory benefit plans such as the Plan. Optionee hereby confirms that Optionee has been informed that the Purchased Shares are restricted securities under the 1933 Act and may not be resold or transferred unless the Purchased Shares are first registered under the Federal securities laws or unless an exemption from such registration is available. Accordingly, Optionee hereby acknowledges that Optionee is prepared to hold the Purchased Shares for an indefinite period and that Optionee is aware that SEC Rule 144 issued under the 1933 Act which exempts certain resales of unrestricted securities is not presently available to exempt the resale of the Purchased Shares from the registration requirements of the 1933 Act.

2. Restrictions on Disposition of Purchased Shares. Optionee shall make no disposition of the Purchased Shares (other than a Permitted Transfer) unless and until there is compliance with all of the following requirements:

(i) Optionee shall have provided the Corporation with a written summary of the terms and conditions of the proposed disposition.

(ii) Optionee shall have complied with all requirements of this Agreement applicable to the disposition of the Purchased Shares.

(iii) Optionee shall have provided the Corporation with written assurances, in form and substance satisfactory to the Corporation, that (a) the proposed disposition does not require registration of the Purchased Shares under the 1933 Act or (b) all appropriate action necessary for compliance with the registration requirements of the 1933 Act or any exemption from registration available under the 1933 Act (including Rule 144) has been taken.

The Corporation shall not be required (i) to transfer on its books any Purchased Shares which have been sold or transferred in violation of the provisions of this Agreement or (ii) to treat as the owner of the Purchased Shares, or otherwise to accord voting, dividend or liquidation rights to, any transferee to whom the Purchased Shares have been transferred in contravention of this Agreement.

3. Restrictive Legends. The stock certificates for the Purchased Shares shall be endorsed with one or more of the following restrictive legends:

“The shares represented by this certificate have not been registered under the Securities Act of 1933. The shares may not be sold or offered for sale in the absence of (a) an effective registration statement for the shares under such Act, (b) a “no action” letter of the Securities and Exchange Commission with respect to such sale or offer or (c) satisfactory assurances to the Corporation that registration under such Act is not required with respect to such sale or offer.”

“The shares represented by this certificate are subject to certain repurchase rights and rights of first refusal granted to the Corporation and accordingly may not be sold, assigned, transferred, encumbered, or in any manner disposed of except in conformity with the terms of a written agreement between the Corporation and the registered holder of the shares (or the predecessor in interest to the shares). A copy of such agreement is maintained at the Corporation’s principal corporate offices.”

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C. TRANSFER RESTRICTIONS

1. Restriction on Transfer. Except for any Permitted Transfer, Optionee shall not transfer, assign, encumber or otherwise dispose of any of the Purchased Shares which are subject to the Repurchase Right. In addition, Purchased Shares which are released from the Repurchase Right shall not be transferred, assigned, encumbered or otherwise disposed of in contravention of the First Refusal Right or the Market Stand-Off.

2. Transferee Obligations. Each person (other than the Corporation) to whom the Purchased Shares are transferred by means of a Permitted Transfer must, as a condition precedent to the validity of such transfer, acknowledge in writing to the Corporation that such person is bound by the provisions of this Agreement and that the transferred shares are subject to (i) the Repurchase Right, (ii) the First Refusal Right and (iii) the Market Stand-Off, to the same extent such shares would be so subject if retained by Optionee.

3. Market Stand-Off.

(a) In connection with any underwritten public offering by the Corporation of its equity securities pursuant to an effective registration statement filed under the 1933 Act, including the Corporation’s initial public offering, Owner shall not sell, make any short sale of, loan, hypothecate, pledge, grant any option for the purchase of, or otherwise dispose or transfer for value or otherwise agree to engage in any of the foregoing transactions with respect to, any Purchased Shares without the prior written consent of the Corporation or its underwriters. Such restriction (the “Market Stand-Off”) shall be in effect for such period of time from and after the effective date of the final prospectus for the offering as may be requested by the Corporation or such underwriters. In no event, however, shall such period exceed one hundred eighty (180) days, and the Market Stand-Off shall in no event be applicable to any underwritten public offering effected more than two (2) years after the effective date of the Corporation’s initial public offering.

(b) Owner shall be subject to the Market Stand-Off provided and only if the officers and directors of the Corporation are also subject to similar restrictions.

(c) Any new, substituted or additional securities which are by reason of any Recapitalization or Reorganization distributed with respect to the Purchased Shares shall be immediately subject to the Market Stand-Off, to the same extent the Purchased Shares are at such time covered by such provisions.

(d) In order to enforce the Market Stand-Off, the Corporation may impose stop-transfer instructions with respect to the Purchased Shares until the end of the applicable stand-off period.

D. REPURCHASE RIGHT

1. Grant. The Corporation is hereby granted the right (the “Repurchase Right”), exercisable at any time during the sixty (60)-day period following the date Optionee

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ceases for any reason to remain in Service or (if later) during the sixty (60)-day period following the execution date of this Agreement, to repurchase at the Repurchase Price any or all of the Purchased Shares in which Optionee is not, at the time of his or her cessation of Service, vested in accordance with the Vesting Schedule applicable to those shares or the special vesting acceleration provisions of Paragraph D.6 of this Agreement (such shares to be hereinafter referred to as the “Unvested Shares”).

2. Exercise of the Repurchase Right. The Repurchase Right shall be exercisable by written notice delivered to each Owner of the Unvested Shares prior to the expiration of the sixty (60)-day exercise period. The notice shall indicate the number of Unvested Shares to be repurchased, the Repurchase Price to be paid per share and the date on which the repurchase is to be effected, such date to be not more than thirty (30) days after the date of such notice. The certificates representing the Unvested Shares to be repurchased shall be delivered to the Corporation on the closing date specified for the repurchase. Concurrently with the receipt of such stock certificates, the Corporation shall pay to Owner, in cash or cash equivalents (including the cancellation of any purchase-money indebtedness), an amount equal to the Repurchase Price for the Unvested Shares which are to be repurchased from Owner.

3. Termination of the Repurchase Right. The Repurchase Right shall terminate with respect to any Unvested Shares for which it is not timely exercised under Paragraph D.2. In addition, the Repurchase Right shall terminate and cease to be exercisable with respect to any and all Purchased Shares in which Optionee vests in accordance with the Vesting Schedule. All Purchased Shares as to which the Repurchase Right lapses shall, however, remain subject to (i) the First Refusal Right and (ii) the Market Stand-Off.

4. Aggregate Vesting Limitation. If the Option is exercised in more than one increment so that Optionee is a party to one or more other Stock Purchase Agreements (the “Prior Purchase Agreements”) which are executed prior to the date of this Agreement, then the total number of Purchased Shares as to which Optionee shall be deemed to have a fully-vested interest under this Agreement and all Prior Purchase Agreements shall not exceed in the aggregate the number of Purchased Shares in which Optionee would otherwise at the time be vested, in accordance with the Vesting Schedule, had all the Purchased Shares (including those acquired under the Prior Purchase Agreements) been acquired exclusively under this Agreement.

5. Recapitalization. Any new, substituted or additional securities or other property (including cash paid other than as a regular cash dividend) which is by reason of any Recapitalization distributed with respect to the Purchased Shares shall be immediately subject to the Repurchase Right and any escrow requirements hereunder, but only to the extent the Purchased Shares are at the time covered by such right or escrow requirements. Appropriate and proportionate adjustments to reflect such distribution shall be made to the number and/or class of Purchased Shares subject to this Agreement and to the Repurchase Price per share to be paid upon the exercise of the Repurchase Right in order to reflect the effect of any such Recapitalization upon the Corporation’s capital structure; provided, however, that the aggregate Repurchase Price shall remain the same.

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6. Corporate Transaction.

(a) The Repurchase Right shall automatically terminate in its entirety, and all the Purchased Shares shall vest in full, immediately prior to the consummation of any Corporate Transaction, except to the extent the Repurchase Right is to be assigned to the successor entity in such Corporate Transaction.

(b) To the extent the Repurchase Right remains in effect following a Corporate Transaction, such right shall apply to any new securities or other property (including any cash payments) received in exchange for the Purchased Shares in consummation of the Corporate Transaction, but only to the extent the Purchased Shares are at the time covered by such right. Appropriate and proportionate adjustments shall be made to the Repurchase Price per share payable upon exercise of the Repurchase Right to reflect the effect of the Corporate Transaction upon the Corporation’s capital structure; provided, however, that the aggregate Repurchase Price shall remain the same. The new securities or other property (including any cash payments) issued or distributed with respect to the Purchased Shares in consummation of the Corporate Transaction shall be immediately deposited in escrow with the Corporation (or the successor entity) and shall not be released from escrow until Optionee vests in such securities or other property in accordance with the same Vesting Schedule in effect for the Purchased Shares.

E. RIGHT OF FIRST REFUSAL

1. Grant. The Corporation is hereby granted the right of first refusal (the “First Refusal Right”), exercisable in connection with any proposed transfer of the Purchased Shares in which Optionee has vested in accordance with the provisions of Article D. For purposes of this Article E, the term “transfer” shall include any sale, assignment, pledge, encumbrance or other disposition of the Purchased Shares intended to be made by Owner, but shall not include any Permitted Transfer.

2. Notice of Intended Disposition. In the event any Owner of Purchased Shares in which Optionee has vested desires to accept a bona fide third-party offer for the transfer of any or all of such shares (the Purchased Shares subject to such offer to be hereinafter referred to as the “Target Shares”), Owner shall promptly (i) deliver to the Corporation written notice (the “Disposition Notice”) of the terms of the offer, including the purchase price and the identity of the third-party offeror, and (ii) provide satisfactory proof that the disposition of the Target Shares to such third-party offeror would not be in contravention of the provisions set forth in Articles B and C.

3. Exercise of the First Refusal Right. The Corporation shall, for a period of twenty-five (25) days following receipt of the Disposition Notice, have the right to repurchase any or all of the Target Shares subject to the Disposition Notice upon the same terms as those specified therein or upon such other terms (not materially different from those specified in the Disposition Notice) to which Owner consents. Such right shall be exercisable by delivery of written notice (the “Exercise Notice”) to Owner prior to the expiration of the twenty-five (25)-day exercise period. If such right is exercised with respect to all the Target Shares, then the Corporation shall effect the repurchase of such shares, including payment of the purchase price,

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not more than five (5) business days after delivery of the Exercise Notice; and at such time the certificates representing the Target Shares shall be delivered to the Corporation.

Should the purchase price specified in the Disposition Notice be payable in property other than cash or evidences of indebtedness, the Corporation shall have the right to pay the purchase price in the form of cash equal in amount to the value of such property. If Owner and the Corporation cannot agree on such cash value within ten (10) days after the Corporation’s receipt of the Disposition Notice, the valuation shall be made by an appraiser of recognized standing selected by Owner and the Corporation or, if they cannot agree on an appraiser within twenty (20) days after the Corporation’s receipt of the Disposition Notice, each shall select an appraiser of recognized standing and the two (2) appraisers shall designate a third appraiser of recognized standing, whose appraisal shall be determinative of such value. The cost of such appraisal shall be shared equally by Owner and the Corporation. The closing shall then be held on the later of (i) the fifth (5th) business day following delivery of the Exercise Notice or (ii) the fifth (5th) business day after such valuation shall have been made.

4. Non-Exercise of the First Refusal Right. In the event the Exercise Notice is not given to Owner prior to the expiration of the twenty-five (25)-day exercise period, Owner shall have a period of thirty (30) days thereafter in which to sell or otherwise dispose of the Target Shares to the third-party offeror identified in the Disposition Notice upon terms (including the purchase price) no more favorable to such third-party offeror than those specified in the Disposition Notice; provided, however, that any such sale or disposition must not be effected in contravention of the provisions of Articles B and C. The third-party offeror shall acquire the Target Shares subject to the First Refusal Right and the provisions and restrictions of Article B and Paragraph C.3, and any subsequent disposition of the acquired shares must be effected in compliance with the terms and conditions of such First Refusal Right and the provisions and restrictions of Article B and Paragraph C.3. In the event Owner does not effect such sale or disposition of the Target Shares within the specified thirty (30)-day period, the First Refusal Right shall continue to be applicable to any subsequent disposition of the Target Shares by Owner until such right lapses.

5. Partial Exercise of the First Refusal Right. In the event the Corporation makes a timely exercise of the First Refusal Right with respect to a portion, but not all, of the Target Shares specified in the Disposition Notice, Owner shall have the option, exercisable by written notice to the Corporation delivered within five (5) business days after Owner’s receipt of the Exercise Notice, to effect the sale of the Target Shares pursuant to either of the following alternatives:

(i) sale or other disposition of all the Target Shares to the third-party offeror identified in the Disposition Notice, but in full compliance with the requirements of Paragraph E.4, as if the Corporation did not exercise the First Refusal Right; or

(ii) sale to the Corporation of the portion of the Target Shares which the Corporation has elected to purchase, such sale to be effected in substantial conformity with the provisions of Paragraph E.3. The First Refusal

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Right shall continue to be applicable to any subsequent disposition of the remaining Target Shares until such right lapses.

Owner’s failure to deliver timely notification to the Corporation shall be deemed to be an election by Owner to sell the Target Shares pursuant to alternative (i) above.

6. Recapitalization/Reorganization.

(a) Any new, substituted or additional securities or other property which is by reason of any Recapitalization distributed with respect to the Purchased Shares shall be immediately subject to the First Refusal Right, but only to the extent the Purchased Shares are at the time covered by such right.

(b) In the event of a Reorganization, the First Refusal Right shall remain in full force and effect and shall apply to the new capital stock or other property received in exchange for the Purchased Shares in consummation of the Reorganization, but only to the extent the Purchased Shares are at the time covered by such right.

7. Lapse. The First Refusal Right shall lapse upon the earliest to occur of (i) the first date on which shares of the Common Stock are held of record by more than five hundred (500) persons, (ii) a determination made by the Board that a public market exists for the outstanding shares of Common Stock or (iii) a firm commitment underwritten public offering, pursuant to an effective registration statement under the 1933 Act, covering the offer and sale of the Common Stock in the aggregate amount of at least twenty million dollars ($20,000,000). However, the Market Stand-Off shall continue to remain in full force and effect following the lapse of the First Refusal Right.

F. SPECIAL TAX ELECTION

The acquisition of the Purchased Shares may result in adverse tax consequences which may be avoided or mitigated by filing an election under Code Section 83(b). Such election must be filed within thirty (30) days after the date of this Agreement. A description of the tax consequences applicable to the acquisition of the Purchased Shares and the form for making the Code Section 83(b) election are set forth in Exhibit II. OPTIONEE SHOULD CONSULT WITH HIS OR HER TAX ADVISOR TO DETERMINE THE TAX CONSEQUENCES OF ACQUIRING THE PURCHASED SHARES AND THE ADVANTAGES AND DISADVANTAGES OF FILING THE CODE SECTION 83(b) ELECTION. OPTIONEE ACKNOWLEDGES THAT IT IS OPTIONEE’S SOLE RESPONSIBILITY, AND NOT THE CORPORATION’S, TO FILE A TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN IF OPTIONEE REQUESTS THE CORPORATION OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HIS OR HER BEHALF.

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G. GENERAL PROVISIONS

1. Assignment. The Corporation may assign the Repurchase Right and/or the First Refusal Right to any person or entity selected by the Board, including (without limitation) one or more stockholders of the Corporation.

2. At Will Employment. Nothing in this Agreement or in the Plan shall confer upon Optionee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Parent or Subsidiary employing or retaining Optionee) or of Optionee, which rights are hereby expressly reserved by each, to terminate Optionee’s Service at any time for any reason, with or without cause.

3. Notices. Any notice required to be given under this Agreement shall be in writing and shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, registered or certified, postage prepaid and properly addressed to the party entitled to such notice at the address indicated below such party’s signature line on this Agreement or at such other address as such party may designate by ten (10) days advance written notice under this paragraph to all other parties to this Agreement.

4. No Waiver. The failure of the Corporation in any instance to exercise the Repurchase Right or the First Refusal Right shall not constitute a waiver of any other repurchase rights and/or rights of first refusal that may subsequently arise under the provisions of this Agreement or any other agreement between the Corporation and Optionee. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature.

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

H. MISCELLANEOUS PROVISIONS

1. Optionee Undertaking. Optionee hereby agrees to take whatever additional action and execute whatever additional documents the Corporation may deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on either Optionee or the Purchased Shares pursuant to the provisions of this Agreement.

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2. Agreement is Entire Contract. This Agreement constitutes the entire contract between the parties hereto with regard to the subject matter hereof. This Agreement is made pursuant to the provisions of the Plan and shall in all respects be construed in conformity with the terms of the Plan.

3. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California without resort to that State’s conflict-of-laws rules.

4. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

5. Successors and Assigns. The provisions of this Agreement shall inure to the benefit of, and be binding upon, the Corporation and its successors and assigns and upon Optionee, Optionee’s permitted assigns and the legal representatives, heirs and legatees of Optionee’s estate, whether or not any such person shall have become a party to this Agreement and have agreed in writing to join herein and be bound by the terms hereof.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first indicated above.

DANGER, INC.
By:
Title:
Address:
	OPTIONEE
Address:

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SPOUSAL ACKNOWLEDGMENT

The undersigned spouse of Optionee has read and hereby approves the foregoing Stock Purchase Agreement. In consideration of the Corporation’s granting Optionee the right to acquire the Purchased Shares in accordance with the terms of such Agreement, the undersigned hereby agrees to be irrevocably bound by all the terms of such Agreement, including (without limitation) the right of the Corporation (or its assigns) to purchase any Purchased Shares in which Optionee is not vested at time of his or her cessation of Service.

	OPTIONEE’S SPOUSE
Address:

EXHIBIT I

ASSIGNMENT SEPARATE FROM CERTIFICATE

FOR VALUE RECEIVED              hereby sell(s), assign(s) and transfer(s) unto Danger, Inc. (the “Corporation”),                      (            ) shares of the Common Stock of the Corporation standing in his or her name on the books of the Corporation represented by Certificate No.                      herewith and do(es) hereby irrevocably constitute and appoint                      Attorney to transfer the said stock on the books of the Corporation with full power of substitution in the premises.

Dated:                                 

Signature

Instruction: Please do not fill in any blanks other than the signature line. Please sign exactly as you would like your name to appear on the issued stock certificate. The purpose of this assignment is to enable the Corporation to exercise the Repurchase Right without requiring additional signatures on the part of Optionee.

EXHIBIT II

FEDERAL INCOME TAX CONSEQUENCES AND

SECTION 83(b) TAX ELECTION

I. Federal Income Tax Consequences and Section 83(b) Election For Exercise of Non-Statutory Option. If the Purchased Shares are acquired pursuant to the exercise of a Non-Statutory Option, as specified in the Grant Notice, then under Code Section 83, the excess of the Fair Market Value of the Purchased Shares on the date any forfeiture restrictions applicable to such shares lapse over the Exercise Price paid for those shares will be reportable as ordinary income on the lapse date. For this purpose, the term “forfeiture restrictions” includes the right of the Corporation to repurchase the Purchased Shares pursuant to the Repurchase Right. However, Optionee may elect under Code Section 83(b) to be taxed at the time the Purchased Shares are acquired, rather than when and as such Purchased Shares cease to be subject to such forfeiture restrictions. Such election must be filed with the Internal Revenue Service within thirty (30) days after the date of the Agreement. Even if the Fair Market Value of the Purchased Shares on the date of the Agreement equals the Exercise Price paid (and thus no tax is payable), the election must be made to avoid adverse tax consequences in the future. The form for making this election is attached as part of this exhibit. FAILURE TO MAKE THIS FILING WITHIN THE APPLICABLE THIRTY (30)-DAY PERIOD WILL RESULT IN THE RECOGNITION OF ORDINARY INCOME BY OPTIONEE AS THE FORFEITURE RESTRICTIONS LAPSE.

II. Federal Income Tax Consequences and Conditional Section 83(b) Election For Exercise of Incentive Option. If the Purchased Shares are acquired pursuant to the exercise of an Incentive Option, as specified in the Grant Notice, then the following tax principles shall be applicable to the Purchased Shares:

(i) For regular tax purposes, no taxable income will be recognized at the time the Option is exercised.

(ii) The excess of (a) the Fair Market Value of the Purchased Shares on the date the Option is exercised or (if later) on the date any forfeiture restrictions applicable to the Purchased Shares lapse over (b) the Exercise Price paid for the Purchased Shares will be includible in Optionee’s taxable income for alternative minimum tax purposes.

(iii) If Optionee makes a disqualifying disposition of the Purchased Shares, then Optionee will recognize ordinary income in the year of such disposition equal in amount to the excess of (a) the Fair Market Value of the Purchased Shares on the date the Option is exercised or (if later) on the date any forfeiture restrictions applicable to the Purchased Shares lapse over (b) the Exercise Price paid for the Purchased Shares. Any additional gain recognized upon the disqualifying disposition will be either short-term or long-term capital gain depending upon the period for which the Purchased Shares are held prior to the disposition.

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(iv) For purposes of the foregoing, the term “forfeiture restrictions” will include the right of the Corporation to repurchase the Purchased Shares pursuant to the Repurchase Right. The term “disqualifying disposition” means any sale or other disposition¹ of the Purchased Shares within two (2) years after the Grant Date or within one (1) year after the exercise date of the Option.

(v) As a result of final Treasury Regulations relating to Incentive Options, the IRS will not respect the filing of a protective election under Code Section 83(b), in connection with an exercise of an option for any Purchased Shares at the time subject to forfeiture restrictions, which would limit Optionee’s ordinary income upon a disqualifying disposition to the excess of the Fair Market Value of the Purchased Shares on the date the Option is exercised over the Exercise Price paid for the Purchased Shares.

(vi) The Code Section 83(b) election will be effective in limiting the Optionee’s alternative minimum taxable income to the excess of the Fair Market Value of the Purchased Shares at the time the Option is exercised over the Exercise Price paid for those shares.

Page 2 of the attached form for making the election should be filed with any election made in connection with the exercise of an Incentive Option.

¹ Generally, a disposition of shares purchased under an Incentive Option includes any transfer of legal title, including a transfer by sale, exchange or gift, but does not include a transfer to the Optionee’s spouse, a transfer into joint ownership with right of survivorship if Optionee remains one of the joint owners, a pledge, a transfer by bequest or inheritance or certain tax-free exchanges permitted under the Code.

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SECTION 83(b) ELECTION

This statement is being made under Section 83(b) of the Internal Revenue Code, pursuant to Treas. Reg. Section 1.83-2.

(1) The taxpayer who performed the services is:

Name:                                                          

Address:                                                       

Taxpayer Ident. No.:                                   

(2) The property with respect to which the election is being made is                      shares of the common stock of Danger, Inc.

(3) The property was issued on                     ,         .

(4) The taxable year in which the election is being made is the calendar year             .

(5) The property is subject to a repurchase right pursuant to which the issuer has the right to acquire the property at the lower of the purchase price paid per share or the fair market value per share, if for any reason taxpayer’s service with the issuer terminates. The issuer’s repurchase right will lapse in a series of installments over a                      period ending on                     .

(6) The fair market value at the time of transfer (determined without regard to any restriction other than a restriction which by its terms will never lapse) is $                     per share.

(7) The amount paid for such property is                      per share.

(8) A copy of this statement was furnished to Danger, Inc. for whom taxpayer rendered the services underlying the transfer of property.

(9) This statement is executed on                     ,         .

Spouse (if any) Taxpayer

This election must be filed with the Internal Revenue Service Center with which taxpayer files his or her Federal income tax returns and must be made within thirty (30) days after the execution date of the Stock Purchase Agreement. This filing should be made by registered or certified mail, return receipt requested. Optionee must retain two (2) copies of the completed form for filing with his or her Federal and state tax returns for the current tax year and an additional copy for his or her records.

The property described in the above Section 83(b) election is comprised of shares of common stock acquired pursuant to the exercise of an incentive stock option under Section 422 of the Internal Revenue Code (the “Code”). Accordingly, it is the intent of the Taxpayer to utilize this election to achieve the following tax results:

1. One purpose of this election is to have the alternative minimum taxable income attributable to the purchased shares measured by the amount by which the fair market value of such shares at the time of their transfer to the Taxpayer exceeds the purchase price paid for the shares. In the absence of this election, such alternative minimum taxable income would be measured by the spread between the fair market value of the purchased shares and the purchase price which exists on the various lapse dates in effect for the forfeiture restrictions applicable to such shares.

2. Section 421(a)(1) of the Code expressly excludes from income any excess of the fair market value of the purchased shares over the amount paid for such shares. Accordingly, this election is also intended to be effective in the event there is a “disqualifying disposition” of the shares, within the meaning of Section 421(b) of the Code, which would otherwise render the provisions of Section 83(a) of the Code applicable at that time. Consequently, the Taxpayer hereby elects to have the amount of disqualifying disposition income measured by the excess of the fair market value of the purchased shares on the date of transfer to the Taxpayer over the amount paid for such shares. Since Section 421(a) presently applies to the shares which are the subject of this Section 83(b) election, no taxable income is actually recognized for regular tax purposes at this time, and no income taxes are payable, by the Taxpayer as a result of this election. The foregoing election is to be effective to the full extent permitted under the Code.

THIS PAGE 2 IS TO BE ATTACHED TO ANY SECTION 83(b) ELECTION FILED IN CONNECTION WITH THE EXERCISE OF AN INCENTIVE STOCK OPTION UNDER THE FEDERAL TAX LAWS.

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APPENDIX

The following definitions shall be in effect under the Agreement:

A. Agreement shall mean this Stock Purchase Agreement.

B. Board shall mean the Corporation’s Board of Directors.

C. Code shall mean the Internal Revenue Code of 1986, as amended.

D. Common Stock shall mean the Corporation’s common stock.

E. Corporate Transaction shall mean either of the following stockholder-approved transactions:

(i) a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction, or

(ii) the sale, transfer or other disposition of all or substantially all of the Corporation’s assets in complete liquidation or dissolution of the Corporation.

F. Corporation shall mean Danger, Inc., a Delaware corporation, and any successor corporation to all or substantially all of the assets or voting stock of Danger, Inc. which shall by appropriate action adopt the Plan.

G. Disposition Notice shall have the meaning assigned to such term in Paragraph E.2.

H. Exercise Price shall have the meaning assigned to such term in Paragraph A.1.

I. Fair Market Value of a share of Common Stock on any relevant date, prior to the initial public offering of the Common Stock, shall be determined by the Plan Administrator after taking into account such factors as it shall deem appropriate.

J. First Refusal Right shall mean the right granted to the Corporation in accordance with Article E.

K. Grant Date shall have the meaning assigned to such term in Paragraph A.1.

L. Grant Notice shall mean the Notice of Grant of Stock Option pursuant to which Optionee has been informed of the basic terms of the Option.

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M. Incentive Option shall mean an option which satisfies the requirements of Code Section 422.

N. Market Stand-Off shall mean the market stand-off restriction specified in Paragraph C.3.

O. 1933 Act shall mean the Securities Act of 1933, as amended.

P. 1934 Act shall mean the Securities Exchange Act of 1934, as amended.

Q. Non-Statutory Option shall mean an option not intended to satisfy the requirements of Code Section 422.

R. Option shall have the meaning assigned to such term in Paragraph A.1.

S. Option Agreement shall mean all agreements and other documents evidencing the Option.

T. Optionee shall mean the person to whom the Option is granted under the Plan.

U. Owner shall mean Optionee and all subsequent holders of the Purchased Shares who derive their chain of ownership through a Permitted Transfer from Optionee.

V. Parent shall mean any corporation (other than the Corporation) in an unbroken chain of corporations ending with the Corporation, provided each corporation in the unbroken chain (other than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

W. Permitted Transfer shall mean (i) a gratuitous transfer of the Purchased Shares, provided and only if Optionee obtains the Corporation’s prior written consent to such transfer, (ii) a transfer of title to the Purchased Shares effected pursuant to Optionee’s will or the laws of inheritance following Optionee’s death or (iii) a transfer to the Corporation in pledge as security for any purchase-money indebtedness incurred by Optionee in connection with the acquisition of the Purchased Shares.

X. Plan shall mean the Corporation’s 2000 Stock Option/Stock Issuance Plan.

Y. Plan Administrator shall mean either the Board or a committee of the Board acting in its capacity as administrator of the Plan.

Z. Prior Purchase Agreement shall have the meaning assigned to such term in Paragraph D.4.

AA. Purchased Shares shall have the meaning assigned to such term in Paragraph A.1.

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BB. Recapitalization shall mean any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the Corporation’s outstanding Common Stock as a class without the Corporation’s receipt of consideration.

CC. Reorganization shall mean any of the following transactions:

(i) a merger or consolidation in which the Corporation is not the surviving entity,

(ii) a sale, transfer or other disposition of all or substantially all of the Corporation’s assets,

(iii) a reverse merger in which the Corporation is the surviving entity but in which the Corporation’s outstanding voting securities are transferred in whole or in part to a person or persons different from the persons holding those securities immediately prior to the merger, or

(iv) any transaction effected primarily to change the state in which the Corporation is incorporated or to create a holding company structure.

DD. Repurchase Price shall mean the lower of (i) the Exercise Price, or (ii) the Fair Market Value per share of Common Stock on the date of Optionee’s cessation of Service.

EE. Repurchase Right shall mean the right granted to the Corporation in accordance with Article D.

FF. SEC shall mean the Securities and Exchange Commission.

GG. Service shall mean the Optionee’s performance of services for the Corporation (or any Parent or Subsidiary) in the capacity of an employee, subject to the control and direction of the employer entity as to both the work to be performed and the manner and method of performance, a non-employee member of the board of directors or an independent consultant.

HH. Subsidiary shall mean any corporation (other than the Corporation) in an unbroken chain of corporations beginning with the Corporation, provided each corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

II. Target Shares shall have the meaning assigned to such term in Paragraph E.2.

JJ. Unvested Shares shall have the meaning assigned to such term in Paragraph D.1.

KK. Vesting Schedule shall mean the vesting schedule specified in the Grant Notice pursuant to which the Optionee is to vest in the Option Shares in a series of installments over his or her period of Service.

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EXHIBIT C

2000 STOCK OPTION/STOCK ISSUANCE PLAN

EX-10.20

Exhibit 10.20

MASTER MANUFACTURING AND DISTRIBUTION AGREEMENT

This MASTER MANUFACTURING AND DISTRIBUTION AGREEMENT (“Agreement”) is entered into as of April 28, 2004 (the “Effective Date”) by and between DANGER, INC., a Delaware corporation, having its principal place of business at 3101 Park Blvd., Palo Alto, California 94306, USA (“Danger”), and SHARP CORPORATION, a corporation organized under the laws of Japan, having its principal place of business at 22-22 Nagaike-cho, Abeno-ku, Osaka 545-8522, Japan (“Sharp”). Danger and Sharp may hereafter be referred to individually as a “Party” or collectively as the “Parties.”

RECITALS

WHEREAS, Danger has developed and owns certain proprietary technology and know-how relating to wireless devices and related software;

WHEREAS, Sharp is engaged in the business of designing, manufacturing and selling electronic products, including wireless handsets and other telecommunications equipment; and

WHEREAS, Sharp and Danger desire to enter into this Agreement to establish a relationship in which Sharp manufactures, markets and sells Products (as defined below) for the North American and European territories.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

AGREEMENT

1. DEFINITIONS. The capitalized terms set forth below shall be defined as follows:

1.1 “Affiliate” means any person or entity controlling, controlled by or under common control with, a Party to this Agreement, such control being exercised through the ownership or control, directly or indirectly, of more than fifty percent (50%) of the voting power of the shares entitled to vote for the election of directors or other governing authority of such entity as of the date of this Agreement or hereafter, provided that such person or entity shall be considered an Affiliate of that Party only during the time such ownership or control exists.

1.2 “Approved Carriers” means wireless network operators that Sharp (or its Affiliates or authorized distributors) and Danger agree in writing are authorized to purchase Products from Sharp, its Affiliates or its authorized distributors for distribution to End Users. The Parties agree that the following companies and their Affiliates are

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Approved Carriers: [ * ]. The Parties acknowledge that Products may not be sold into every country in which an Approved Carrier operates. The specific countries will be determined by Sharp’s, its Affiliates’ or its authorized distributors’ arrangements with Approved Carriers and the availability of reverse logistics services in a particular country.

1.3 “Business Day” shall mean a day during the regular work week (Monday through Friday) that is not a national holiday or a company holiday in the United States (in the case of Danger) or Japan (in the case of Sharp).

1.4 “Carrier Customers” means Approved Carriers who enter into written agreements to purchase Products from Sharp, its Affiliates or authorized distributors and the Danger Service Software from Danger.

1.5 “Certified Product Design” means a Product Design that has been approved by the Parties (in order to confirm compatibility with the Danger Software) for Products to be manufactured by Sharp.

1.6 “Danger Design Technology” means, collectively, the Reference Designs, product designs, and any other design specifications (including both hardware and software specifications), or design or technical information provided by Danger to Sharp, except that Danger Design Technology does not include the Danger Software.

1.7 “Danger Marks” means the trademarks, trade names, service marks and/or logos specified in Exhibit B, which may be reasonably modified by Danger from time to time.

1.8 “Danger Service Software” means Danger’s back-end software and services for providing End Users with content and functionality for the Product, such as email, instant messaging, Internet browser, address book, calendar, camera, data synchronization (between Danger’s data center servers and the Danger Client Software) and premium application downloads.

1.9 “Danger Client Software” means any Danger proprietary software (including firmware), in object code form, that is installed on the Products, including, without limitation the hiptop^® operating system and hiptop^® application software.

1.10 “Danger Software” means, collectively, the Danger Service Software and the Danger Client Software.

1.11 “End User” means an individual consumer who purchases a Product for such consumer’s own personal use and not for resale or further distribution.

1.12 “GSM” means the Global System for Mobile Communication and all Intellectual Property Rights related thereto including, without limitation, any Intellectual Property Rights which the holder thereof has notified the European Telecommunications Standards Institute (“ETSI”) are “essential”, or potentially “essential”, to the ETSI standards for GSM.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1.13 “Intellectual Property Rights” means any and all intellectual property rights worldwide arising under statutory law, common law or by contract and whether or not perfected, including without limitation, all: (i) patents, patent applications and patent rights; (ii) rights associated with works of authorship including copyrights, copyright applications, copyright registrations, mask works rights, mask work applications, mask work registrations; (iii) rights relating to the production of trade secrets and confidential information; (iv) any rights analogous to those set forth in this section and any other proprietary rights relating to intellectual property; and (v) divisionals, continuations, renewals, reissues and extension of the foregoing (as and to the extent applicable) now existing, hereafter filed, used or acquired, and whether registered or unregistered.

1.14 “M-1” means the first Product to be manufactured under this Agreement. The M-1 is further described in the Product Plan attached hereto as Exhibit A-1. Changes to, modifications of and derivatives of the M-1 shall be deemed new Products, unless the Parties amend Exhibit A-1 to incorporate such changes, modifications or derivatives into the M-1 or unless the changes are merely software changes or cosmetic hardware changes for customization per a Carrier Customer’s request.

1.15 “Out-of-Pocket Expense” (whether or not capitalized in this Agreement) means an expense or cost incurred by one party which requires an actual payment to a third party (e.g. travel expenditures for airfare, lodging and meals). A Party will only be required to reimburse the other Party for out-of-pocket expenses where explicitly stated in this Agreement.

1.16 “Product(s)” means a multifunction wireless device that is (a) manufactured by Sharp in accordance with a Certified Product Design; (b) for which the Parties have executed a Product Plan and (c) compatible with the Danger Software and no other software or services with similar functionality.

1.17 “Product Design” means a complete and comprehensive design for a Product that includes all hardware, software, and material specifications for the Product and that includes the physical design and appearance of the Product.

1.18 “Product Plan” shall have the meaning set forth in Section 3.2.

1.19 “Reference Designs” means Danger’s schematics, specifications, minimum hardware requirements, and other documentation relating to the hardware design of a Product.

1.20 “Sharp Marks” means the trademarks, trade names, service marks and/or logos specified in Exhibit C, which may be reasonably modified by Sharp from time to time.

1.21 “Sharp Design Technology” means collectively, any Product designs and any other design specifications (including both hardware and software specifications) or design or technical information developed by Sharp that are not based on the Danger Design Technology.

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1.22 “Tier 3 Support” means that if a Carrier Customer’s “Tier 2” support group cannot answer questions posed by End Users, Danger will provide support directly to Carrier Customer’s “Tier 2” customer support group in order to help answer the questions. For purposes of clarification, Carrier Customers’ customer support organizations are generally organized into a “Tier 1” group (call center operators who field calls from End Users) and a “Tier 2” group (call center managers or escalation specialists who answer questions that the “Tier 1” group cannot answer).

2. REVENUE MODEL.

2.1 Sharp Revenue. The Parties anticipate that Sharp will generate revenue under this Agreement by selling Products to Carrier Customers and by selling content (either developed by Sharp or its partners) that is downloaded via the Danger Server Software in accordance with Danger’s developer program.

2.2 Danger Revenue. The Parties anticipate that Danger will generate revenue under this Agreement by (i) charging Carrier Customers activation and monthly service fees for providing the Danger Service Software; and (ii) charging Carrier Customers for content that is distributed via the Danger Service Software.

3. FRAMEWORK AGREEMENT. The Parties intend for this Agreement to provide a framework for the Parties to develop, manufacture and sell M-1 and future Products. Specific details for each Product covered by this Agreement will be set forth in separate “Product Plans” (as described below). The M-1 Product Plan is attached hereto as Exhibit A-1.

3.1 Financial Discussions. Prior to the development and manufacture of a new Product, the Parties shall discuss the financial terms for the new Product. In particular, the Parties shall determine whether or not Danger will require [ * ] from Sharp in exchange for [ * ] and/or Danger [ * ] or other payments (e.g. [ * ]) for [ * ] or [ * ] The Parties anticipate that all [ * ] and the [ * ] will be [ * ] unless [ * ] to the [ * ] or the [ * ] The Parties envision that the following list of changes, which list is not exhaustive, qualify as [ * ] that could require [ * ]

3.2 Product Plans. With respect to each Product developed hereunder, the Parties will execute a product plan, in the form attached hereto as Exhibit A, setting forth the hardware and software specifications, development schedule, test plan, commercial launch date, Sales and Marketing Plan (as defined in Section 9 below), and any other items mutually agreed to for that particular Product version (each, a “Product Plan”). Each Product Plan shall set forth specific development, testing, manufacturing, commercial and other obligations of each Party with respect to that particular Product. Each Party agrees to fulfill its respective development, testing, manufacturing and commercial obligations set forth in each Product Plan in accordance with the schedules set forth therein. Each Product Plan will be numbered consecutively (i.e., Exhibit A-1, A-2, etc.) and will be signed by authorized representatives of each Party. The M-1 Product Plan is attached hereto as Exhibit A-1. In the event of a conflict between any Product Plan and the main body of this Agreement, the Product Plan shall govern.

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3.3 Product Lifecycle Management. Sharp and Danger agree to conduct reviews at least once per quarter to evaluate: (a) bug fixes and necessary enhancements to the Danger Software and each Party’s Product Designs to ensure customer satisfaction; (b) hardware changes and engineering change orders; (c) feature upgrades to enhance Product positioning and drive additional sales; (d) expense reduction opportunities and (e) end-of-life decisions regarding particular versions of the Product and the eventual phase out of support with respect to such Product versions. Sharp will provide Danger at least six (6) months notice prior to discontinuing production (“end of life”) of a Product or parts for a Product.

3.4 Development Roadmap. The Parties will cooperate to develop a product roadmap and associated schedule that reflects the direction and future evolution of the Products and Danger Software. The roadmap may include plans for major releases of, or other modifications to, the Products or Danger Software, such as different industrial designs, cost reductions, and other new features as to which the Parties may mutually agree. Except as expressly provided herein, each Party will be responsible for the costs of its development obligations hereunder.

3.5 Technical Contacts. Danger and Sharp will each designate a technical contact as the primary individual responsible for facilitating communications between the Parties and for coordinating all activities associated with a Product Plan (the “Technical Contacts”), including but not limited to, meeting on a regular basis to assess the status of the development efforts under this Agreement. The Technical Contacts for each Party shall be set forth in the applicable Product Plan.

4. SHARP RESPONSIBILITIES.

4.1 Manufacturing and Shipping.

(a) Sharp shall be responsible for Product manufacturing, and the fulfillment of orders for Products, including shipping and delivery. Sharp may utilize its Affiliates to assist in performing its manufacturing obligations and it may use its Affiliates and authorized distributors to assist it in performing its order fulfillment obligations; provided in all such cases Sharp shall be liable for its Affiliates and authorized distributors’ compliance with this Agreement. As part of its manufacturing obligations Sharp will develop sufficient tests and will thoroughly test all manufactured Products to ensure that they comply with the Reference Designs, the Certified Product Design, and the Product Plan. If any errors or deficiencies are discovered, Sharp will provide Danger with a detailed description of such errors or deficiencies and the Parties will work together to rectify such errors or deficiencies.

(b) The Parties shall discuss Sharp’s lead times for manufacture and shipment of Product so each party is informed. In the event any changes to Sharp’s lead time for manufacture of Products occur, the Party on notice of the change shall notify the other Party.

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(c) Sharp will be responsible for ensuring an adequate supply of spare parts to distributors or repair facilities so warranty returns can be repaired and sent back to the field without undue delay.

4.2 Sales and Account Management.

(a) Carrier Customer Agreements. Sharp, its Affiliates, or its authorized distributor will use best efforts to enter into separate handset supply agreements with Approved Carriers (each, a “Carrier Customer Agreement”) whereby such Approved Carriers will place purchase orders for Products. If Sharp wants to grant any Carrier Customer exclusive rights to distribute the Products in any territory, the Parties shall discuss and mutually agree on the rights to be granted. The Carrier Customer Agreement will, at a minimum, address the following points:

(i) Replacement Products, “Seed Stock” and Non-Working Display Units. Sharp shall provide seed stock so Carrier Customers can handle returns easily and shall offer mock-up, non-working display units to Carrier Customers to support sales.

(ii) Warranty and Reverse Logistics. Sharp shall be solely responsible for providing a warranty to the Carrier Customer stating that the Products will be free from defects in workmanship, materials, and hardware design and will comply with the Certified Product Design. Sharp shall, either directly or through its Affiliates or authorized distributors, make sure that spare parts for each Product will be available for a period of [ * ] years following the commercial launch of such Product. Notwithstanding the foregoing, Sharp shall have no obligation to provide items printed for production (e.g. end user manual, product packaging) for longer than [ * ] year following Product discontinuation.

(iii) Marketing and Sales Support. Sharp shall, either directly or through its Affiliates or authorized distributors, use best efforts to promote and sell Products and will assign appropriate resources to manage sales to Carrier Customers.

(b) Carrier Approval Process. Except for M-1, Sharp, either directly or through its Affiliates or authorized distributors, shall be responsible for satisfying Approved Carrier process or tests for approval of a Product. Danger shall provide Sharp, its Affiliates and authorized distributors support for the carrier approval process as set forth in Section 5.7. The Parties’ respective responsibilities for the carrier approval process for M-1 is set forth in Exhibit A-1 (M-1 Product Plan).

4.3 Hardware Design for Future Products, Approvals.

(a) Sharp shall develop Product Designs for future Products. Sharp and Danger will work together in good faith to develop a Product Plan for each such Product and the expected price range to be charged by Sharp to Carrier Customers for each such Product. Sharp will allocate sufficient engineering resources to fulfill its development obligations hereunder.

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(b) Sharp will provide Danger with support for Sharp’s Product Designs so Danger may evaluate such Products Designs and create or modify Danger Software as necessary. Sharp will cooperate with Danger in Danger’s development efforts for designs of future Products, including providing feedback on design concepts, suggesting suppliers, and suggesting how contemplated products would fit into Sharp’s planned product lines.

(c) Sharp shall, at its expense, make all necessary tooling and test equipment for the design and manufacture of each Product (except for M-1, which is described in the attached Product Plan) unless otherwise agreed to in writing by the Parties. Tooling and test equipment provided by one Party to the other or paid by one Party shall remain the property of the supplying or paying Party, as the case may be. In the event this Agreement terminates for a reason other than for Danger’s material breach, Danger shall have the right to purchase any Sharp owned tooling and test equipment for a Product at a reasonable price. The price shall be negotiated by the parties in good faith, and shall be based on the tooling/test equipment’s remaining productive life as estimated using a straight-line depreciation calculation. For the M-1 Product, the Parties shall allocate the tooling for the Product as set forth in the Product Plan.

(d) For each Product version manufactured hereunder, Sharp shall provide Danger, [ * ], with [ * ] of such Products for testing, evaluation and field trials. Unless otherwise agreed to in a Product Plan, the allocation of such Products shall be [ * ] engineering verification testing (EVT) units, [ * ] design verification testing (DVT) units and [ * ] process verification testing (PVT) units. In addition, as requested by Danger, Sharp shall provide Danger with additional EVT, DVT and PVT units at Sharp’s manufacturing cost.

(e) Sharp shall provide Approved Carriers and Carrier Customers with Products for testing, evaluation and field trials in accordance with terms agreed upon between Sharp and such parties.

(f) Regulatory and Industry Approvals.

(i) Except for the M-1 Product for which Danger shall be responsible (See Section (f)(ii) below), Sharp, at its expense, shall ensure that all Products (other than the M-1) comply with all applicable governmental regulations (including FCC and CE requirements). Sharp, at its expense, shall also obtain any industry-required approvals (including PTCRB and GCF requirements) for the Product. Danger shall provide Sharp with reasonable support for such approvals at no charge, unless otherwise set forth in a Product Plan; provided, however, Sharp shall reimburse Danger for all out-of-pocket expenses incurred by Danger to provide such support.

(ii) Danger shall be responsible, [ * ], for ensuring that the M-1 Product complies with all applicable governmental regulations (including FCC and CE requirements) and for obtaining any industry-required approvals (for example PTCRB and GCF requirements). If, after Danger has obtained regulatory certification and industry approvals, Sharp wishes to make any changes to the M-1 Product or accessories,

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including but not limited to parts from new suppliers, design or manufacturing changes, Sharp shall first propose such changes to Danger in writing. If, in Danger’s opinion, any of the proposed changes require recertification or reapproval, Sharp shall [ * ] for seeking such recertification and/or reapproval; provided however, Danger shall be responsible for [ * ] for recertification and/or reapproval if Sharp’s change is [ * ] the Danger Design Technology or the Danger Software. In the event Danger incurs any costs, fines, damages or other liabilities due to (i) Sharp’s failure to notify Danger of a change to the M-1 Product or (ii) Sharp’s implementation of a change to the M-1 Product prior to Danger receiving the appropriate certifications or approvals for such change, Sharp shall reimburse and indemnify Danger for any such costs, fines, damages or other liabilities.

(iii) Sharp will provide, at its expense, all Products required for regulatory and industry testing and pre-testing to the approval bodies. In the event that Sharp believes the Danger Software or a Product Design needs to be modified in order to comply with applicable governmental regulations or to obtain the necessary approvals, Sharp shall so notify Danger, and the parties will work together in good faith to determine how to make the necessary modifications.

(g) Training and Support. Sharp will provide Danger with reasonable technical support training with respect to any Sharp modifications to the Danger Design Technology or the Danger Software so that Danger’s engineering team and Danger’s support personnel team can support Products containing such modifications.

4.4 Product Liability. Subject to the indemnification procedures in Section 15, Sharp shall indemnify, defend and hold harmless Danger, its officers, directors, employees and agents (“Danger Indemnified Parties”) from and against all loss, harm and liability, including, all costs, damages, settlements, claims, suits and expenses (including reasonable attorneys’ fees) incurred by any Danger Indemnified Party and arising out of or resulting directly from any third party claim that the use of a Product caused death, bodily injury (including, without limitation, death or bodily injury from electromagnetic radiation) or loss, damage or destruction of property unless such injury, loss or damage was caused solely by the Danger Software design. Sharp shall provide similar indemnification to Carrier Customers.

4.5 GSM Intellectual Property Rights (applies only to M-1 Products and other future Products that are developed or manufactured under this Agreement).

(a) The Parties wish to [ * ] Products from a vendor that provides [ * ] (e.g. [ * ]) as soon as possible, but only as mutually agreed upon by the Parties.

(b) Subject to the indemnification procedures in Section 15, Sharp shall indemnify, defend and hold harmless Danger Indemnified Parties from and against all loss, harm and liability, including, all costs, damages, settlements, claims, suits and expenses (including reasonable attorneys’ fees) incurred by any Danger Indemnified Party and arising out of or resulting directly from any third party claim that the Products infringe any third party Intellectual Property Rights relating to GSM (“GSM Claims”). Sharp shall provide similar indemnification to Carrier Customers.

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(c) Danger will provide Sharp with reasonable assistance in accordance with Section 15.1 to defend or settle GSM Claims. In the case of a GSM Claim, Danger will assist Sharp by having Danger engineers evaluate the claim and suggest ways (if any) to avoid infringement. Danger will use reasonable efforts to make this evaluation and assessment within one (1) month of Sharp’s request. In the case of a GSM Claim that the Danger Software causes an infringement, if in Danger’s opinion the claim can be avoided by making changes to the Danger Software at minimal cost, Danger shall use reasonable efforts to make such changes. If the cost of making such changes is, in Danger’s opinion, too expensive or difficult to make, Danger shall have no obligation to make the changes unless the parties mutually agree in writing.

(d) Sharp shall be responsible for all GSM royalty obligations or license fees arising out of the manufacture or sale of Products under this Agreement. Danger shall refer all parties seeking GSM royalties to Sharp. The Parties shall work together to take advantage of licensing opportunities with GSM rights holders to reduce GSM royalty obligations and license fees. This Section 4.5(d) shall not limit Sharp’s indemnity obligations under Section 4.5(b) above.

4.6 Sharp Intellectual Property Rights. Subject to the indemnification procedures in Section 15, Sharp shall indemnify, defend and hold harmless Danger Indemnified Parties from and against all loss, harm and liability, including all costs, damages, settlements, claims, suits and expenses (including reasonable attorneys’ fees) incurred by any Danger Indemnified Party and arising out of or resulting directly from any third party claim that any Sharp Design Technology or any software provided by Sharp infringes any third party Intellectual Property Rights (except where such claim arises solely as a result of Danger’s modification thereto). In addition, if Sharp receives intellectual property indemnification from its component supplier, Sharp shall indemnify, defend and hold Danger Indemnified Parties harmless from any third party claim that a component purchased by Sharp infringes a third party Intellectual Property Right, but only to the extent Sharp receives intellectual property indemnification from its component supplier. Sharp shall provide similar indemnification to Carrier Customers. The Parties do not anticipate the M-1 Product to contain any Sharp Design Technology.

5. DANGER RESPONSIBILITIES

5.1 Danger Service Software Infrastructure. Danger shall be responsible for the Danger Service Software infrastructure, including but not limited to maintaining servers at its network operations center to operate the Danger Service Software.

5.2 Sales and Marketing Support. During the term of the Agreement, Danger will market the Danger Software to Approved Carriers and Carrier Customers. Danger will provide Sharp with “train-the-trainer” support training sessions with respect to the Danger Software for Sharp’s, its Affiliates’ and authorized distributors’ channel managers to promote sales of Products. The timing, location and size of these training sessions will be mutually agreed upon by the Parties

5.3 O/S and Core Application Development. Following the execution of

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this Agreement, Danger will continue to develop new features for and enhancements to the Danger Client Software. Danger shall use reasonable efforts to fix bugs and errors discovered in the Danger Software. The Parties agree that the timing for release of any bug fix or new version of the Danger Software shall be subject to the approval of Carrier Customers.

5.4 Danger’s Hardware Design Support. Following the commercial launch of the M-1 Product, Danger will provide support for hardware, firmware, application and service engineering support to assist Sharp to design and manufacture future generation Products and derivatives. The Parties shall comply with Section 3.1 before undertaking any new Product development.

5.5 Third-Party Developer Program. Danger will use reasonable commercial efforts to maintain, update, and distribute a software development kit (“SDK”) which enables third-party developers to create applications and services for the Products and Danger Software.

5.6 Public Relations and Marketing Support. Danger shall provide marketing and public relations support to promote Sharp’s distribution of the Products. The form of such support shall be at Danger’s sole discretion. Danger shall not issue a press release mentioning Sharp without Sharp’s prior consent, which shall not be unreasonably withheld or delayed.

5.7 Support for Carrier Approval Process. Danger shall, [ * ], provide Sharp with reasonable assistance to perform Carrier Customer’s approval processes, this shall include assistance for completion of a Carrier Customer products requirement documentation (often referred to as the “PRD”) and the conduct of ongoing field trials using the Danger “QA” and “Trial” programs. For the M-1 Product, Danger shall complete the Carrier Customer PRD documentation.

5.8 Localization. Danger shall localize the Danger Software and associated documentation as mutually agreed upon by the Parties in writing. The initial M1 device shall be available in US English, UK English, German, French, and French Canadian. For additional “[ * ]” languages, Danger shall perform the localization work [ * ]. For [ * ] languages (e.g. [ * ]) the [ * ] the cost of the localization work [ * ]. In the event the Parties mutually agree to perform [ * ] language localization, Danger shall provide the Danger Software and documentation to Sharp [ * ] and Sharp shall provide its [ * ] entry and font software [ * ] to Danger so the Parties can complete the localization work.

5.9 Danger Software/Service Indemnity. Subject to the indemnification procedures set forth in Section 15, Danger shall indemnify, defend and hold harmless Sharp, and its officers, directors, employees and agents (“Sharp Indemnified Parties”), from and against all loss, harm and liability, including all costs, damages, settlements, claims, suits and expenses (including reasonable attorneys’ fees) incurred by any Sharp Indemnified Party arising out of or resulting directly from any third party claim that any Danger Software (including the Danger Service Software) infringes any third party Intellectual Property Rights (except where such claim arises solely as a result of a Sharp

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modification thereto or where such claim would be covered by Section 4.5). Danger shall provide similar indemnification to Carrier Customers. Danger shall be responsible for any [ * ] third parties due to (i) the distribution of a [ * ] implementation as part of the Danger Software, (ii) the creation of [ * ] by the Danger Software, or (iii) any Danger Software that operates the [ * ] on a Product.

5.10 Danger Design Technology Indemnity Subject to the indemnification procedures set forth in Section 15, Danger shall indemnify, defend and hold harmless Sharp, and its officers, directors, employees and agents (“Sharp Indemnified Parties”), from and against all loss, harm and liability, including all costs, damages, settlements, claims, suits and expenses (including reasonable attorneys’ fees) incurred by any Sharp Indemnified Party arising out of or resulting directly from any third party claim that any Danger Design Technology infringes any third party Intellectual Property Rights (except where such claim arises solely as a result of a Sharp modification thereto or where such claim would be covered by Section 4.5). Danger shall be responsible for any [ * ] third parties due to (i) the distribution of the [ * ] design developed by Danger as part of the M-1 Product, (ii) the distribution of the [ * ] developed by Danger and (iii) the unique design of the [ * ] on the M-1 Product. Except as set forth in the preceding sentence, Danger shall have no obligation to indemnify or defend Sharp Indemnified Parties against any claim or allegation that a component part for the Product that Sharp purchases from a third party infringes any intellectual property rights.

5.11 Carrier Customer “Tier 3” Support. Danger shall provide “Tier 3 Support” for Carrier Customers in accordance with Danger’s agreements with Carrier Customers. In no event will Danger be obligated to directly interact with End Users.

5.12 Cost Sharing for M-1. As mutually agreed upon by the Parties in the M-1 Product Plan, Danger will share with Sharp certain costs incurred by Sharp in evaluating and testing the M-1 Product.

5.13 Training Materials and End User Manuals. Danger will provide Sharp with training and operating guides, End User manuals and sales materials in electronic format as are developed by Danger from time to time, free of charge for materials in English or other “Western” languages, and at Danger’s then-current localization rates, for guides and manuals in non-Western languages (e.g. Chinese, Arabic, etc.) (if not already localized). Danger will provide updates to sales materials and training materials, at the same time and in the same format that such materials are made generally available by Danger to its customers, to provide support for ongoing distribution of the Products.

6. OTHER TERMS

6.1 License Grants to Sharp.

(a) Danger Design Technology License. Subject to the terms and conditions of this Agreement, Danger grants to Sharp for the term of this Agreement, a [ * ], non-exclusive, non-transferable, non-sublicenseable, worldwide license under Danger’s Intellectual Property Rights to: (i) internally use and reproduce the Danger

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Design Technology and [ * ] based on the Danger Design Technology solely to develop and manufacture Products as set forth in this Agreement; (ii) to use the Danger Design Technology to manufacture, have manufactured, test, support, import and export Products; and (iii) to demonstrate, distribute, offer to sell and sell Products, either directly or indirectly, to Approved Carriers, Carrier Customers and to any other party that the Parties mutually agree upon.

(b) Danger Client Software License. Subject to the terms and conditions of this Agreement, Danger grants to Sharp for the term of this Agreement, a [ * ], non-exclusive, non-transferable, non-sublicenseable, worldwide license under Danger’s Intellectual Property Rights to: (i) internally use and reproduce the Danger Client Software solely to develop and manufacture Products as set forth in this Agreement; (ii) distribute, display and perform the Danger Client Software only as embedded within Products and (iii) sublicense to End Users (directly or indirectly through Carrier Customers) the right to use the Danger Client Software solely as embedded within Products. The Parties shall ensure that all sublicenses of Danger Client Software to End Users shall be pursuant to an enforceable End User license agreement approved by Danger (the “End User License Agreement”) governing such End User’s use of the Danger Client Software. The Parties shall coordinate with the Carrier Customers to have the End User License Agreement added to the Product either at the manufacturing facility or at the Carrier Customer distribution center. The End User License Agreement shall survive any termination of this Agreement.

(c) [ * ] Licenses. Although the licenses granted above are [ * ], the Parties may agree to [ * ] for Products manufactured after [ * ]. As discussed in Section 3.1 above, the Parties shall discuss [ * ] before entering into a new Product Plan. The Parties anticipate that there will not be [ * ] unless significant new [ * ]

(d) Additional Licenses. In the event Sharp requests a license to the Danger Software and/or the Danger Design Technology to Sharp for use in products that do not operate Danger’s proprietary service, the Parties shall discuss in good faith whether to enter into such a license.

(e) License Restrictions. Other than the rights granted in this Agreement, no other license, right, or interest is granted to either Party by implication, estoppel, or otherwise, for any purpose, and any rights not expressly granted are reserved by the licensing Party. Without limiting the foregoing, Sharp shall not, and shall not authorize any third party to: (a) translate, reverse engineer, decompile, disassemble, attempt to derive the source code of any Danger Software provided to Sharp solely in object code form; (b) modify or create any modifications to the Danger Software; (c) sublicense, rent, lease, loan, timeshare, sell, distribute, assign or transfer any rights in, grant a security interest in, or transfer possession of any Danger Design Technology or Danger Software, except as expressly provided in this Agreement; or (d) obfuscate, alter or remove any of Danger’s copyright or other proprietary rights notices or legends appearing on or in the Danger Software or Danger Design Technology. The Parties acknowledge and agree that the licenses granted by Danger under this Agreement are restricted to Products that are compatible with the Danger Software (and no other

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software or services with similar functionality) and that are based on Certified Product Designs.

6.2 License Grant to Danger. Subject to the terms and conditions of this Agreement, Sharp grants to Danger, during the term of this Agreement, a non-exclusive, non-transferable, worldwide, license under Sharp’s Intellectual Property Rights to (i) use, modify and reproduce Sharp Design Technology to design and develop Product reference designs and Danger Software; (ii) demonstrate Products that include Sharp Design Technology to Approved Carriers and Carrier Customers; (iii) use Products that include Sharp Design Technology for testing, promotional, and development purposes, (iv) use, demonstrate, sell, offer for sale, distribute (directly to end users or through customers or distributors), and import Products incorporating Sharp Design Technology; and (v) only in the special case described in Section 6.6, make and have made Products incorporating Sharp Design Technology.

6.3 Danger Software Warranty. Danger will warrant to Carrier Customers that the Danger Software will perform substantially in accordance with the Danger Software specifications for a period of time to be mutually agreed upon between the Carrier Customer and Danger. Danger will have no direct warranty obligation to End Users.

6.4 Contract Manufacturing Agreement. Danger will have the right to purchase Products from Sharp (i) for Danger’s use (e.g. for development, testing, marketing, public relations and sales promotion activities) and (ii) in the case Sharp, its Affiliate or its authorized distributor do not sell Products to a wireless operator that wishes to purchase Products and Danger Services, in which case Danger shall have the right to re-sell to such wireless operator Products purchased from Sharp. The Danger Products will not be sold under the Sharp brand without Sharp’s consent. The Parties shall use their respective best efforts to execute a separate agreement (the “CM Agreement”) that sets the terms for such supply of Products within ninety (90) days of the date of this Agreement. For Products purchased by Danger in accordance with this Section 6.4, the price and other terms of sale per unit shall be similar to those provided to Sharp’s North American distributor of the Product; provided however, Sharp may reasonably adjust the prices and other terms to account for smaller volumes, different delivery terms and Product customizations. Sharp may also adjust the prices and other terms for Products sold to Danger under this Section 6.4 as necessary to avoid breaching its agreement with its North American distributor. In addition, for Products purchased under this Section 6.4, Sharp shall indemnify Danger for GSM Claims and product liability claims.

6.5 Support Outside of North America. The Parties will discuss and mutually agree upon a plan to distribute Products to Carriers in markets such as Europe, Latin America and Asia.

6.6 Sharp Manufacturing Rights.

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(a) Subject to the terms and conditions of this Agreement, Sharp shall [ * ] during the term of this Agreement. Danger shall [ * ] In the event that Sharp is unwilling or unable to [ * ] that are made at [ * ] and are consistent with Sharp’s [ * ], Danger reserves the right to have [ * ] to such [ * ] If Sharp’s inability to [ * ] is due to Sharp’s [ * ], Danger may only exercise its right to [ * ] if Sharp does not, within [ * ] of Danger’s request, commit in writing to [ * ] as soon as is reasonably possible given [ * ] for the [ * ] Notwithstanding the foregoing, if the time period quoted by Sharp to [ * ] is more than [ * ] days longer than the time period given to Danger by a [ * ], then Danger may exercise its rights to [ * ] only for such [ * ]. In addition, in the event that Sharp [ * ] with a particular [ * ], Danger may have one or more third parties [ * ]

(b) During the term of the Agreement, except in [ * ], Sharp will [ * ] with a [ * ] and a [ * ] to [ * ] without Danger’s [ * ] The preceding sentence’s [ * ] shall not apply to Sharp’s [ * ] or [ * ] which Sharp may [ * ] This Section 6.6(b) shall not be deemed a license or waiver of Danger’s [ * ]

6.7 Third Party Royalties.

(a) [ * ] Related Royalties. In the event the [ * ] a Product requires the payment of royalties to a third party, as between the Parties, [ * ] shall be responsible for such royalties unless otherwise explicitly set forth in this Agreement or a Product Plan.

(b) [ * ] Related Royalties. In the event the [ * ] a Product requires the payment of royalties to a third party, as between the Parties, [ * ] shall be responsible for such royalties, unless otherwise explicitly set forth in this Agreement or a Product Plan.

6.8 Emergency Remedial Actions.

(a) Danger Defect. In the event that Sharp is required under its contractual commitments to a Carrier Customer or its authorized distributor to reflash or recall Products due to a defect in the Danger Client Software that causes Products to become unusable, the Parties shall meet and confer to establish a mutually agreeable plan to remedy the defect. Such plan shall aim to minimize the impact to the Carrier Customer and shall assign roles to each Party for resolution of the defect. Each Party shall perform its role under the plan free of charge, but in the event that Sharp incurs any out-of-pocket expenses in accordance with the mutually agreed upon plan, Danger shall reimburse Sharp for such expenses.

(b) Sharp Defect. In the event that Danger is required under its contractual commitments to a Carrier Customer or distributor to reflash or recall Products due to a manufacturing or hardware defect in a Product that causes Products to become unusable, the Parties shall meet and confer to establish a mutually agreeable plan to remedy the defect. Such plan shall aim to minimize the impact to the Carrier Customer and shall assign roles to each Party for resolution of the defect. Each Party shall perform its role under the plan free of charge, but in the event that Danger incurs any out-of-

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pocket expenses in accordance with the mutually agreed upon plan, Sharp shall reimburse Danger for such expenses.

(c) Radio Module. In the event that either Party is required to incur out-of-pocket expenses due to a hardware or software defect in a Product’s radio module that is supplied by a third party, the Parties shall meet and confer to establish a mutually agreeable plan to remedy the defect. Unless otherwise agreed, each party will bear its own costs and out-of-pocket expenses in implementing the agreed upon plan. Furthermore, the Parties shall work together to have the third party radio vendor pay for any costs or out-of-pocket expenses incurred in remedying the defect.

7. OWNERSHIP.

7.1 Danger Technology. Danger has and shall retain exclusive ownership of any and all right, title, and interest in and to the Danger Design Technology, the Danger Software, and the Danger Marks, including any and all Intellectual Property Rights therein or related thereto, as well as any modifications thereto other than modifications made by Sharp. In the event Sharp makes any suggestions, feedback or modifications to the Danger Software or Danger Design Technology, Sharp hereby agrees to and hereby grants to Danger a royalty-free, perpetual, worldwide license to fully exploit all such suggestions, feedback or modifications.

7.2 Sharp Technology. Sharp shall own any and all right, title, and interest in and to the Sharp Marks and the Sharp Design Technology, including any and all Intellectual Property Rights therein or related thereto, as well as any modifications thereto other than modifications made by Danger. In the event Danger makes any suggestions, feedback or modifications to the Sharp Design Technology, Danger hereby agrees to and hereby grants to Sharp a royalty-free, perpetual, worldwide license to fully exploit all such suggestions, feedback or modifications.

7.3 Joint Works. Unless the Parties agree otherwise, the Parties will jointly own all right, title and interest in any inventions and all Intellectual Property Rights therein which have been jointly created by the Parties during the term of this Agreement (“Joint Works”). Each joint owner shall have an equal and undivided ownership interest in the Joint Works, with the right to use, license and sublicense the Joint Works as part of its own products and services as though it were the sole owner thereof, without any obligation of profit-sharing or accounting or requirement for consent of the other party. Except as permitted by the prior sentence, neither Party may license, sublicense or assign its rights in a Joint Work to a third party for use with products or services that compete with the other Party’s products and services without the prior permission of the other Party. The Parties shall use their respective reasonable effort to allocate ownership rights to any Joint Work prior to commencing any joint development work.

7.4 Joint Infringement. In the event of a claim by a third party that the combination of technology provided by Danger and technology provided by Sharp infringes such third party’s intellectual property rights, the Parties shall meet and confer to determine how to handle such claim.

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7.5 Responsibility for Modifications to the Other Party’s Technology. Where one Party (the “Modifying Party”) makes modifications to the technology (the “Original Technology”) of the other Party the following shall apply:

(a) Subject to the indemnification procedures set forth in Section 15, a Modifying Party shall indemnify, defend and hold harmless the other Party, and its officers, directors, employees and agents (“Indemnified Parties”), from and against all loss, harm and liability, including all costs, damages, settlements, claims, suits and expenses (including reasonable attorneys’ fees) incurred by any Indemnified Party as a result of any third party claim alleging an Intellectual Property Right infringement arising out of the modifications made by the Modifying Party.

(b) The Modifying Party shall have no indemnification obligation under this Section 7.5 if the Original Technology alone would have caused an infringement of such third party’s Intellectual Property Rights.

8. Branding of Products.

8.1 Branding Requirements. The Parties shall mutually agree on the branding for the exterior of each Product. Sharp shall affix or cause to be affixed the Sharp Mark on such Products and on all related packaging, promotional and advertising materials as mutually agreed to by Sharp and the Carrier. In addition, Sharp shall provide appropriate branding opportunities to Danger, as mutually agreed to by Danger and Sharp, in the marketing and distribution of any Product. Notwithstanding the foregoing, Sharp shall affix or cause to be affixed the “hiptop^® Technology by Danger, Inc.” logo (or other logo designated by Danger) on all Products distributed hereunder in a location and of a size to be determined by the Parties.

8.2 License to Danger Marks. Subject to the terms and conditions of this Agreement, Danger grants to Sharp a non-exclusive, non-transferable, non-sublicenseable and royalty-free license, during the term of this Agreement, to use the Danger Marks solely in connection with Sharp’s distribution, marketing and promotional responsibilities under this Agreement, provided that in all such cases, Sharp’s uses of the Danger Marks shall be subject to Section 8.4 and in compliance with Danger’s reasonable trademark usage guidelines, which shall be supplied to Sharp and which may be reasonably modified from time to time.

8.3 License to Sharp Marks. Subject to the terms and conditions of this Agreement, Sharp grants to Danger a non-exclusive, non-transferable and royalty-free license to use, reproduce, distribute, and display the Sharp Marks solely in connection with Danger’s marketing and promotional responsibilities under this Agreement, provided that in all such cases, Danger’s uses of the Sharp Marks shall be subject to Section 8.4 and in compliance with Sharp’s reasonable trademark usage guidelines, which shall be supplied to Danger and which may be reasonably modified from time to time.

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8.4 Trademark Usage. Except as otherwise expressly stated in this Agreement, each Party agrees that all uses of the other Party’s trademarks will: (a) include the proper marking for the trademark and the appropriate trademark attribution in reasonably close proximity to its first use of the trademarks; (b) not alter the trademarks in any way; and (c) use the trademarks so they will not be combined or confused with any other trademark that may be used by the other Party. As between Danger and Sharp, each Party agrees that all uses of the other Party’s trademarks, including the goodwill and reputation associated therewith, will inure to the benefit of the other Party. Each Party will submit to the other Party a sample of all proposed materials wherein the trademarks of the other Party will be used and such Party will not publish or use such materials without the other Party’s prior written approval (which may be provided via email). Each Party will promptly respond to any such requests for approval; provided, however, that failure to respond will in no event be deemed to constitute approval.

9. Marketing and Sales Plan. Sharp and Danger agree to perform the obligations set forth in a sales and marketing plan to be mutually agreed to by the Parties within sixty (60) days after the execution of a Product Plan (the “Sales and Marketing Plan”), which shall include, without limitation, how the Parties will jointly approach and manage Approved Carriers and Carrier Customers, the expected price range for the Products, sales thresholds and market catalysts for price changes, target territories for distribution, target sales quotas, and a description of marketing collateral and sales materials. Ninety (90) days prior to the end of each calendar year during the term of this Agreement, the Parties agree to negotiate in good faith any modifications and updates to the requirements in the Sales and Marketing Plan for the subsequent year.

10. REPORTING.

10.1 Reporting by Sharp.

(a) Sharp will notify Danger within five (5) Business Days of each shipment of Product to wireless carriers. The notification shall include the number of Products shipped and the name of the wireless carrier to whom the Products were shipped. The reason for this reporting is that Danger invoices Carrier Customers for service fees upon shipment and delivery of Products to the Carrier Customer.

(b) Within fifteen (15) Business Days after the end of each month during the term of this Agreement, Sharp, or, as applicable, its Affiliate or authorized distributor will submit a report in electronic format (MS Excel) to Danger detailing, (a) the number of Products manufactured by Sharp in the previous month; (b) the number of Products shipped by Sharp during the previous month, on a carrier-by-carrier basis (detailing units by IMEI and by country); (c) non-binding, rolling sales forecasts for the Product, on a carrier-by-carrier basis based on Sharp’s good faith estimates; (d) (as reasonably available to Sharp) the number of Products sent to Sharp (or its warranty repair agent) for warranty repair during such month, accompanied by an electronic report summarizing the defect, IMEI, Carrier Customer, date of purchase and return, and other information relating to repairs mutually agreed to by the Parties, and (e) any other information that the Parties may mutually agree upon. The reason for this reporting is

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that Danger needs the information for budgeting, customer billing and server capacity planning. All such information shall be considered Confidential Information under this Agreement.

10.2 Reporting by Danger. Within fifteen (15) days after the end of each month during the term of this Agreement, Danger will submit a report to Sharp (both to Sharp’s Tokyo sales group and to Sharp’s Nara manufacturing group) summarizing Danger’s sales efforts during the previous month (e.g. number of carrier calls, new Carrier Customers, Danger’s good faith estimates for Carrier Customer order volumes, etc.).

11. CONFIDENTIAL INFORMATION

11.1 Obligations. Each Party agrees that information (including, but not limited to business, technical, and financial information) that is designated in writing as confidential information or which the receiving Party should reasonably know is confidential information (“Confidential Information”) that it obtains from the other Party under this Agreement, is Confidential Information of the disclosing Party (“Discloser”). Without limiting the foregoing, the Parties agree that all Danger Design Technology and Danger Software is Danger Confidential Information. The receiving Party (“Recipient”) agrees (a) to keep the Discloser’s Confidential Information confidential, (b) to use the Discloser’s Confidential Information only for the purposes of fulfilling its obligations under this Agreement, (c) to use at least the same degree of care in keeping the Discloser’s Confidential Information confidential as its uses for its own confidential information of a similar nature (and, in no event, less than a reasonable degree of care), and (d) not to disclose the Discloser’s Confidential Information to any person, except its officers, directors, agents, professional advisors, contractors, subcontractors and employees and to the officers, directors, agents, professional advisors, contractors, subcontractors and employees of its Affiliates who have a reasonable need to know for the purposes of this Agreement, and have previously signed a non-use and nondisclosure agreement covering the Confidential Information containing terms and conditions substantially similar to the provisions of this Agreement

11.2 Exclusions. The obligations under this Section 11 shall not extend to any information that the Recipient can document (a) was in the public domain at the time it was disclosed or becomes part of the public domain after disclosure through no fault of the Recipient or its employees or agents; (b) was known to the Recipient at the time of its disclosure or becomes known to it without breach of this Agreement, as evidenced by contemporaneous written records; (c) is independently developed by the Recipient, as evidenced by contemporaneous written records, without use of the Discloser’s Confidential Information; (d) is disclosed by the Discloser to a third party without restriction on such third party’s rights to disclose or use the same; or (e) is approved for release upon the Discloser’s prior written consent. It shall not be a breach of this 11 for the Recipient to disclose Confidential Information to the extent such Confidential Information is disclosed by Recipient pursuant to judicial order, a requirement of a governmental agency or by operation of law, provided that the Recipient gives the Discloser prompt written notice of any such requirement prior to the disclosure.

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11.3 Confidentiality of Agreement. The Parties agree to treat the terms and conditions of this Agreement as Confidential Information, except that each Party may disclose the terms and conditions of this Agreement (a) to those of its employees, contractors, and Affiliates to whom disclosure is necessary in order to effectuate the matters contemplated herein, (b) to its independent auditors and financial, tax, legal, and business advisors, and investors provided such parties are informed as to the confidential nature of the information so disclosed; (c) in response to any subpoena, governmental mandate, or discovery request, in connection with any litigation, or so as to comply with any applicable law, rule or regulation, provided that the other Party has been notified in advance of such disclosure and been afforded sufficient opportunity to seek and obtain confidential treatment by the governmental body having jurisdiction over the matter at hand; (d) as may be necessary for such Party to enforce its respective rights under this Agreement; (e) as may be necessary for the purpose of obtaining protection for intellectual property, including patents; and (f) as necessary for any Party to comply with public financial reporting obligations pursuant to SEC laws and regulations.

12. TERM; TERMINATION

12.1 Term. This Agreement shall commence as of the Effective Date and shall continue in effect for a period of three (3) years (“Initial Term”), unless terminated earlier pursuant to this Agreement.

12.2 Renewal. Following the Initial Term, this Agreement will be automatically renewed for additional and successive one (1) year terms, unless either Party provides the other Party with at least ninety (90) days’ written notice of its intent not to renew prior to the expiration of the then-current term.

12.3 Termination. This Agreement may be terminated in its entirety by either Party immediately upon the occurrence of any the following events: (a) if the other ceases to do business, or otherwise terminates its business operations; (b) if the other materially breaches any material provision of this Agreement and fails to cure such breach within forty-five (45) days after receiving written notice from the non-breaching Party describing such breach; or (c) if the other shall seek protection under any bankruptcy, receivership, trust deed, creditors arrangement, composition or comparable proceeding, or if any such proceeding is instituted against the other (and not dismissed within one hundred eighty (180) days). The Parties acknowledge that a material breach of this Agreement shall occur if Danger grants a third party the right to manufacture Products in violation of Section 6.6(a). In addition, in the event Danger terminates the CM Agreement for Sharp’s material breach, Danger may immediately terminate this Agreement. In the event Danger ceases operations without a successor in interest, Sharp may continue to manufacture and sell Products to Carrier Customers that are authorized by Danger to operate the Danger Service Software following Danger’s cessation of operations.

12.4 Effect of Termination. Except as otherwise provided for in this Section 12.4, upon expiration or any termination of this Agreement, all licenses granted by Danger hereunder shall immediately terminate (except for licenses to End Users as set forth in Section 6.1(b)), and Sharp shall promptly return to Danger all copies of any

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Danger Design Technology or Danger Software in its possession. In addition, each Party will promptly return all Confidential Information of the other Party in its possession (and all copies and abstracts thereof). Notwithstanding the foregoing, unless this Agreement is terminated by Danger for material breach by Sharp, for a period of [ * ]months following the date of termination, Sharp may, continue to manufacture and sell Products that were produced or for which parts were ordered (and could not be cancelled) prior to the date of termination. The provisions set forth in Sections 1, 4.1(c), 4.2(c), 4.3(f)(i) and (ii), 4.4, 4.5, 4.6, 5.9, 5.10, 6.1(e), 6.7, 7 and 11 through 16 will survive the expiration or termination of this Agreement. Section 10 shall also survive the expiration or termination of this Agreement, but only for a period of six (6) months.

12.5 Source Code Escrow. Within thirty (30) days of Sharp’s written request, the parties shall enter into a source code escrow agreement that will provide for the release of the Danger Software in the event Danger ceases operations without a successor in interest. Sharp shall be responsible for the cost of the escrow agreement and for any annual fees associated with the escrow account. Danger’s current source code escrow account is with [ * ]

13. REPRESENTATIONS AND WARRANTIES.

13.1 Each Party represents and warrants to the other Party that (a) as of the Effective Date it has the full right and authority to enter into this Agreement and grant the rights and licenses granted herein; (b) it has not previously granted and will not grant any rights in conflict with this Agreement; and (c) it will comply with all applicable laws, regulations and rules in connection with its obligations and performance under this Agreement.

13.2 Except as expressly provided in this Agreement, Danger and Sharp each expressly disclaim any warranties, express, implied, statutory or otherwise, with respect to this Agreement and all activities hereunder, including, without limitation, any implied warranties of merchantability, or fitness for a particular purpose. Without limiting the foregoing, Danger does not warrant that the Danger Design Technology or the Danger Software will operate without interruption, nor does Danger make any warranty regarding the use of the Danger Design Technology or Danger Software or the results therefrom.

14. LIMITATION OF LIABILITY. Except for a [ * ] or a [ * ] and except for each Party’s respective obligations under Sections [ * ], in no event will either Party be liable under this Agreement under any contract, negligence, strict liability, tort, or other legal or equitable theory for any incidental, special or consequential damages of any nature whatsoever, arising out of or in connection with this Agreement, even if such Party has been advised of the possibility of such damages. Except for a [ * ] or of [ * ], and except with respect to each Party’s respective obligations under sections [ * ], in no event shall either Party’s aggregate cumulative liability for any claims arising out of this Agreement exceed [ * ]. The Parties acknowledge and agree that the limitations of liability set forth in this Section 14 (Limitation of Liability) reflect the allocation of risk set forth in this Agreement and that, in the absence of such limitations, the terms of this Agreement would be substantially different.

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15. INDEMNIFICATION PROCEDURE. Any indemnification provided for in this Agreement, favoring Danger in Sections 4.4, 4.5, and 4.6 and favoring Sharp in Section 5.9 and 5.10, and favoring each party in Section 7.5 shall follow the procedures set forth below.

15.1 A Party requesting indemnification (the “Indemnified Party”) shall provide the other Party (the “Indemnifying Party”) with prompt written notice of any claim for which it seeks indemnification, shall allow the Indemnifying Party sole control of the defense and any settlement of any such claim, and shall reasonably cooperate and provide reasonable assistance to the Indemnifying Party, at the Indemnifying Party’s expense, in connection with the defense or settlement of any such claim.

15.2 Additional Indemnification Rights. The Parties shall work together to prevent manufacturing interruptions due to an allegation of infringement of third party Intellectual Property Rights. In the event of any allegation of infringement of any third party Intellectual Property Right which is subject to indemnification under this Agreement, the Indemnifying Party shall have the right, in its sole discretion, to (a) obtain a license from the third party; (b) defend against such allegation through final judgment and all timely filed appeals; and/or (c) redesign the allegedly infringing products in order to avoid infringement. In the event of a redesign as described in (c) above is made available for commercial use, the Indemnified Party shall use diligent commercial efforts to promptly cease use and distribution of all allegedly infringing products and commence use of the redesigned product, provided that such redesigned product provides substantially similar functionality and is of substantially similar quality as the allegedly infringing product, but in no event of less quality than the former product.

15.3 Limitations. Notwithstanding the foregoing, neither Party shall have any indemnification obligations pursuant to this Agreement with respect to any claim arising from (a) the operation or use of the such Party’s technology or Intellectual Property Rights with other products, software or materials not furnished by such Party where such Party’s technology or Intellectual Property Rights would not themselves be infringing; or (b) the modification or improvement of such Party’s technology or Intellectual Property Rights by the other Party or any third party.

15.4 Entire Obligation. Sections 4.5, 4.6, 5.9, 5.10 and 7.5, and this Section 15 state the Parties’ entire liability and sole and exclusive remedies with respect to any infringement of any Intellectual Property Rights of any third party, whether direct or contributory.

16. MISCELLANEOUS

16.1 Export Control. The Parties shall comply with the U.S. Foreign Corrupt Practices Act and all applicable export laws, restrictions, and regulations of any U.S. or foreign agency or authority. The Parties will not export or re-export, or allow the export or re-export of any product, technology or information it obtains or learns pursuant to this Agreement (or any direct product thereof) in violation of any such law, restriction or regulation.

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16.2 Amendment and Waiver. Except as otherwise expressly provided herein, any provision of this Agreement may be amended or waived (either generally or in any particular instance and either retroactively or prospectively) only with the written consent of the authorized representatives of both Parties. However, it is the intention of the Parties that this Agreement be controlling over additional or different terms of any purchase order, confirmation, invoice or similar document, even if accepted in writing by both Parties, and that waivers and amendments of any provision of this Agreement shall be effective only if made by non-preprinted agreements signed by both Parties and demonstrably understood by its term to be an amendment or waiver of this Agreement. The failure of either Party to enforce its rights under this Agreement at any time for any period shall not be construed as a waiver of such rights.

16.3 Assignment. Neither Party may transfer or assign this Agreement nor the rights and obligations hereunder (by operation of law or otherwise) without the prior written consent of the other Party. Notwithstanding the foregoing, no consent shall be required for any assignment in connection with any merger, acquisition, sale or transfer of all, or substantially all of a Party’s stock, assets or business to which this Agreement relates. If Danger ceases operations but transfers or assigns all or substantially all of its assets or business to a third party successor, Danger will endeavor to have this Agreement assigned to such successor. The terms and conditions of this Agreement shall bind and inure to each Party’s successors and permitted assigns.

16.4 Injunctive Relief. Each Party acknowledges and agrees that certain obligations and promises of the Parties set forth in this Agreement are of a special, unique and extraordinary character. Each Party hereby acknowledges and agrees that a material breach of any of its promises or agreements contained herein involving or relating to the Intellectual Property Rights of the other Party will result in irreparable and continuing damage to the other Party for which there will be no adequate remedy at law. Accordingly, in the event of any such breach the non-breaching Party shall be entitled to injunctive relief and/or a decree of specific performance, in addition to such other and further relief as may be proper (including monetary damages if appropriate).

16.5 Governing Law and Legal Actions. In the event Sharp brings a claim against Danger, this Agreement shall be governed by, and construed in accordance with the law of the state of California. In the event Danger brings a claim against Sharp, this Agreement shall be governed by, and construed in accordance with the law of Japan. Except for actions for injunctive relief and/or a decree of specific performance described in Section 16.4, all disputes arising in connection with this Agreement shall be finally settled under the Rules of Conciliation and Arbitration of the International Chamber of Commerce by one or more arbitrators appointed in accordance with said Rules. The place of the arbitration proceedings shall be, unless otherwise agreed between the Parties, the country in which the respondent resides. The arbitration proceedings shall be conducted, and the award shall be rendered, in the English language. The Parties shall be entitled to provide pleadings, briefs and written evidence in the English language only. Any award hereunder shall be final and binding upon the Parties and may, if necessary, be enforced by any court or other competent authority, but save as aforesaid all rights of appeal or

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recourse to any court of law whatsoever are hereby excluded in relation to any arbitration hereunder and any award made therein.

16.6 Headings. Headings and captions are for convenience only and are not to be used in the interpretation of this Agreement.

16.7 Notices. Any notice or other communication required to permitted to be made or given to either Party under this Agreement shall be deemed sufficiently made or given on the date of delivery if delivered in person or by overnight commercial courier service with tracking capabilities with costs prepaid, or five (5) days after the date of mailing if sent by certified first class U.S. mail, return receipt requested and postage prepaid, at the address of the Parties set forth below or such other address as may be given from time to time under the terms of this notice provision:

If to Sharp:

SHARP CORPORATION

492 Minosho-cho, Yamatokoriyama-shi

Nara, Postal Code 639-1186

Japan

Attn: [ * ]

Fax: [ * ]

With a copy to: [ * ]

If to Danger:

DANGER, INC.

3101 Park Blvd.

Palo Alto, CA 94306

Attention: C.E.O.

Fax: (650) 289-5001

With a copy to the Vice President and General Counsel

16.8 Severability. If any provision of this Agreement is held to be illegal or unenforceable, that provision shall be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in full force and effect and enforceable.

16.9 Relationship of Parties. The Parties hereto expressly understand and agree that the other is an independent contractor in the performance of each and every Party of this Agreement and is solely responsible for all of its employees and agents and its labor costs and expenses arising in connection therewith. The Parties are not partners, joint venturers or otherwise affiliated and neither has any right or authority to bind the other in any way.

16.10 Force Majeure. Neither Party shall be liable to the other for its failure to perform any of its obligations under this Agreement during any period in which its

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performance is delayed, rendered impracticable or impossible due to circumstances beyond its reasonable control, including, without limitation, acts of God, fire, flood, war, governmental action, compliance with laws or regulations, strikes, lockouts or other serious labor disputes for so long as such event of force majeure continues in effect, provided that such Party uses reasonable efforts under the circumstances to notify the other Party of the circumstances causing the delay and to resume performance as soon as possible.

16.11 Remedies. Except as otherwise expressly stated in this Agreement, the rights and remedies of a Party set forth herein with respect to failure of the other to comply with the terms of this Agreement (including, without limitation, rights of full termination of this Agreement) are not exclusive, the exercise thereof shall not constitute an election of remedies and the aggrieved Party shall in all events be entitled to seek whatever additional remedies that may be available in law or in equity.

16.12 Press Releases. Except to the extent necessary under applicable laws, the Parties agree that no press releases relating to the substance of the matters contained herein will be made unless mutually agreed upon. Notwithstanding the foregoing, the Parties agree to issue a mutually agreed upon press release describing the relationship contemplated by this Agreement within forty-five (45) days after the execution of this Agreement.

16.13 Entire Agreement. The Parties agree that this Agreement, together with any exhibits hereto, constitute the entire understanding and agreement with respect to the subject matter hereof and supersedes all proposals, oral or written, all negotiations, conversations, promises or discussions between or among Parties relating to the subject matter of this Agreement.

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of the Effective Date by their duly authorized representatives.

SHARP CORPORATION		DANGER, INC.
By:	/s/ Hirohide Nakagawa	By:	/s/ Henry R. Nothhaft
Name:	Hirohide Nakagawa	Name:	Henry R. Nothhaft
Title:	Group General Manager of Information and Communication Systems Group	Title:	Chairman & Chief Executive Officer

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FORM OF EXHIBIT A

PRODUCT PLAN

This Exhibit A-    , dated                      is executed by Danger, Inc. (“Danger”) and Sharp Corporation (“Sharp”) pursuant to Section 3.2 of the Master Manufacturing and Distribution Agreement by and between Danger and Sharp dated as of April 28, 2004 (the “Agreement”). This Exhibit, when executed by the Parties, shall be binding on the Parties, shall constitute part of the Agreement, and shall be subject to the terms and conditions thereof. All capitalized terms used herein and not otherwise defined in this Exhibit shall have the meanings ascribed to them in the Agreement. In the event of any inconsistencies between the terms of this Exhibit and the terms of the Agreement, the terms of the Exhibit shall be controlling.

1. Product Name

2. Product Specifications

3. Development schedule

4. Test plan

5. Commercial launch date

6. Marketing Plan

7. Sales Plan

8. Other Product Details

9. Technical Contacts

IN WITNESS WHEREOF, the Parties have caused this Exhibit to be executed as of the Effective Date by their duly authorized representatives.

SHARP CORPORATION	DANGER, INC.
[ * ]        [ * ]
By:	By:
Name:	Name:
Title:	Title:

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EXHIBIT A-1

M-1 Product Plan

This Exhibit A-1 is executed by Danger, Inc. (“Danger”) and Sharp Corporation (“Sharp”) pursuant to Section 3.2 of the Master Manufacturing and Distribution Agreement by and between Danger and Sharp dated as of April 28, 2004 (the “Agreement”). This Exhibit, when executed by the Parties, shall be binding on the Parties, shall constitute part of the Agreement, and shall be subject to the terms and conditions thereof. All capitalized terms used herein and not otherwise defined in this Exhibit shall have the meanings ascribed to them in the Agreement. In the event of any inconsistencies between the terms of this Exhibit and the terms of the Agreement, the terms of the Exhibit shall be controlling.

1. Product Name: M-1 (also known as the PV-100 Series).

2. Product Specifications

HARDWARE SPECIFICATION

Feature	Description
Device	•        Nickname: hiptop2® (generic), Sidekick (T-Mobile USA) •        Model Number: PV-100 •        Form factor: Flip screen exposes QWERTY keyboard •        Size: 130 x 66 x 22 mm (5.1”x2.6”x0.9”) •        Weight: about 200g (~7 oz) (TBD)
Display	•        Flip screen opens and cants forward to expose keyboard and support optimum viewing. •        Flip screen swivels closed for compact storage •        240x160 pixel display •        60x40mm viewable area •        16-bit color display with over 65,000 colors •        Transflective TFT screen viewable in bright sunlight
Keyboard (Fig. 3)	•        5-row QWERTY keyboard •        Dedicated number row •        Dedicated 12-key dialpad area •        Includes easy access key for @ symbol •        English (US) (may be localized for other languages)
Backlighting	•        Light sensor automatically controls backlight •        Screen and keyboard both illuminated by backlight
Imaging	•        Integrated VGA (640 x 480 pixel) camera located on the back of the device •        Supplemental LED for close-range illumination •        Support for a “night mode” setting

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Feature	Description
	•        Convex mirror to assist with self-portraits
Navigation and Controls	•        Scroll Wheel: Supports both scrolling and selection •        Send/End and Page Up/Down Buttons: Buttons adjacent to scroll wheel function as send/end buttons in the phone application and as page up/down buttons in data applications (when the phone is not in use) •        Directional Pad: 4-way navigation controller •        Menu Button: Access available menu options •        Jump Button: Returns user to the main Jump screen •        Done Button: Accepts a selection •        Cancel Button: Rejects a selection •        Volume Buttons: External buttons control volume •        Power Button: External button powers device on or off •        Shoulder Buttons: Two application-specific buttons on the top side of the device provide easy access to features in the Camera, MMS, and Phone applications
Speaker and Microphone	•        Device includes front and back speakers to ensure that notifications are audible •        Microphone and speakers support both speakerphone and handheld phone use
Notifications	•        Used for ringtones, reminders, or feedback within applications such as games •        Sounds: 12-voice polyphonic MIDI synthesizer •        Vibration: Motor provides force feedback •        Multicolor LEDs: RGB LEDs illuminate speaker
Radio	•        GSM/GPRS radio •        Enfora Tri-band (900/1800/1900 MHz or 850/1800/1900 MHz) •        Multislot Class 10 functionality •        AMR Support •        Wireless off “airplane mode” supported
Processor	•        ARM7 processor
Memory	•        RAM: 32 MB •        Flash: 16 MB
Battery	•        Rechargeable internal Lithium polymer battery •        1200 mAH capacity
Attachments	•        Audio jack: For use with an external headset •        Power jack: For use with a battery charger •        USB B Port: Covered port for use in system recovery •        Lanyard attachment: For use with a carrying strap
Accessories	•        Battery charger •        Hands-free ear bud •        Carrying case •        Start Guide •        Reference Guide (Full Manual available via web) •        SIM card & Instructions (will be added by Carrier) •        Welcome Guide (will be added by Carrier)

27

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Fig 1. Front of device with screen flipped open

Fig 2. Back of device

28

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Fig 3. English (US) keyboard with dedicated dialpad area

SOFTWARE SPECIFICATION

OS	•        Based on hiptop OS and Software Release 2.0
Phone	•        Supports handheld, hands-free, and speakerphone modes •        Customizable ringtones and Caller ID images •        Voicemail •        Call forwarding •        Hold •        Mute •        Multi-party calling •        Call log
Web Browser	•        HTML 4.0 Web Browser •        SSL Support •        Cookies support
WAP Browser	•        WAP 1.2.1 and WAP 2.0 Browser
E-Mail Client	•        Push email solution (“Instant email”) •        Fetch from device account and up to 3 POP3/IMAP accounts •        Transcoding support for of MS Word, Adobe Acrobat & Image attachments •        Playback support for WAV sound file attachments
SMS	•        Short Message Service (SMS) •        Store messages on device or SIM Card •        Send/Receive Concatenated SMS •        Delivery Reports •        Reply Request
MMS	•        Multimedia Messaging Service (MMS) (Optional) •        Compose MMS with up to 3 slides •        Include a picture, sound, or a 20 second voice note on each slide •        Digital Rights Management: Forward Lock
Instant Messaging	•        AIM and Yahoo Messenger clients available (Optional, at additional cost to Carriers) •        Full Buddy List functionality •        Instant Buddy List updates
PIM Applications*	•        Address Book •        Contact sharing through Send/Receive vCards •        Calendar •        To Do •        Notes •        Web interface for PC access to data
Camera gallery	•        Captures of images from device camera •        Night mode and supplemental LED options •        Stores up to 36 images •        Photo Caller ID
Gaming & Entertainment	•        Rock & Rocket game (optional) •        Premium Download Manager supports purchase and management of:

29

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

	o Ringtones o Applications
Additional Data Applications	•        SIM Application Toolkit, Release 99

• * Intellisync PIM synchronization for M-1 will be an optional feature of the Danger Service Software.

3. Development Schedule. Below are the key milestone dates that the Parties commit to meet for the M-1 project. Danger shall manage the development, testing and production schedules for the M-1 hardware and software with Sharps mutual agreement.

DVT units will be [ * ] by [ * ] Danger will [ * ] and [ * ] are not to exceed a [ * ], of which [ * ] will be provided [ * ] Pricing for these devices will be [ * ] In the event that Danger will [ * ], Danger will [ * ] for such [ * ] based upon a price [ * ]

Date	Milestone/Key Date
[ * ]	[ * ] delivers [ * ] PVT units to [ * ]
[ * ]	[ * ] SDD approval
[ * ]	[ * ] starts test iteration #1
[ * ]	Pre-production SMT start
[ * ]	[ * ] delivers [ * ] PVT units with final software to [ * ]
[ * ]	[ * ] starts test iteration #2
[ * ]	Pre-production final assembly start
[ * ]	Mass production SMT start
[ * ]	Mass production final assembly start
[ * ]	Sharp transfers initial delivery units to Sharp, Nara warehouse
[ * ]	Sharp delivers initial units to [ * ] distribution center

* Sharp may change the asterick (*) dates as needed due to changes in the status of [ * ] anticipated approval.

Technical Contacts:

Danger	Sharp
Name: [ * ]	Name: [ * ]
Title: SVP of Engineering & Operations	Title: [ * ]
Tel: [ * ]	Tel: [ * ]
Email: [ * ]	Email: [ * ]

4. Test plan

30

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

a. Industry Standard Tests. The following table details industry standard tests that are required for the development of M-1.

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

b. Additional Required Tests. The following table details additional tests that the Parties require for the development of M-1. The Parties will mutually agree on the test specifications or test series for each test.

[ * ]
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]
[ * ]
[ * ]	*
[ * ]	*
[ * ]	*

31

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

[ * ]
[ * ]	*
[ * ]	*
[ * ]	*
[ * ]
[ * ]
[ * ]
[ * ]

5. Danger Technology. For this M-1 Project Plan, the following Danger Design Technology and Danger Software is licensed to Sharp [ * ] under the terms of the Agreement.

a. Reference Design: M-1 Reference Design, already provided to Sharp.

b. Danger Client Software: Based on hiptop OS and Software Release 2.

6. Sales and Marketing Terms.

a. Sharp will promote the M-1 product as mutually agreed to by the Parties.

b. Sharp will make joint Danger and Sharp calls to potential Carrier Customers for the purposes of promoting the M-1 product.

7. Other Product Details.

a. [ * ] Royalty. [ * ] will be required to remit to [ * ] royalties for the [ * ], [ * ] and [ * ] The royalties will commence on the earlier of (a) [ * ] or (b) the date Sharp ships M-1 products with software that implements the [ * ]

b. Radio. [ * ] shall be responsible for paying the following royalties for the [ * ]: $[ * ] per unit for the first [ * ] units, $[ * ] per unit for units [ * ] to [ * ], $[ * ] per unit for units [ * ] Danger anticipates that the royalty will be included in the cost of the [ * ] to be purchased from [ * ], and the royalty will be remitted by [ * ] to [ * ] If [ * ] (or [ * ]) negotiates a separate [ * ] agreement for the [ * ] and the applicable royalty is not included in the [ * ], then [ * ] (or [ * ]) shall pay [ * ] the applicable royalty.

c. [ * ] Related Royalties. In the event the [ * ] embedded on the M-1 requires the payment of royalties to a third party, as between the Parties, [ * ] shall be responsible for such royalties (e.g. [ * ]).

d. [ * ] Related Royalties. In the event the M-1 hardware design or implementation requires the payment of royalties to a third party, as between the Parties, [ * ] shall be responsible for such royalties, unless otherwise explicitly set forth in this Product Plan or in the Agreement (e.g. [ * ]).

32

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

e. Battery Replacement Warranty.

i. For the M-1 Product battery, [ * ] (or its [ * ]) shall negotiate the battery replacement warranty period with each [ * ]

ii. Notwithstanding the foregoing, if [ * ] requests a [ * ] battery replacement warranty (commencing from the date of purchase by an End User) for the M-1 Product, [ * ] will provide [ * ] with such a [ * ] battery replacement warranty.

iii. For Carrier Customers outside of North America, the parties shall allocate the cost of the battery replacement warranty as follows (unless otherwise agreed to with the Carrier Customer). [ * ] shall pay all expenses related to servicing a battery replacement during the [ * ] [ * ] of the [ * ] warranty period (e.g. labor costs to replace the battery, shipment expenses, etc.) and [ * ] shall pay all expenses related to servicing a battery replacement during the [ * ] of the [ * ] warranty period (as invoiced, with proper documentation by [ * ]). For the battery unit [ * ] shall, at a minimum, provide the Carrier Customer with a [ * ] from the date of End User purchase. [ * ] shall specify to the Carrier Customer that the End User shall be responsible for the cost of the replacement battery unit after the end of Sharp’s applicable battery unit warranty.

f. [ * ]

i. Pursuant to Section 5.9, [ * ] shall be responsible for indemnifying [ * ] against any intellectual property infringement claim by a third party for any [ * ] develops or procures from a third party for the operation of the [ * ] on the M-1 Product.

ii. Pursuant to Section 4.6 of the Agreement, if Sharp receives intellectual property indemnification from its [ * ] supplier, Sharp shall indemnify, defend and hold Danger Indemnified Parties harmless from any third party claim that the [ * ] purchased by Sharp infringes a third party Intellectual Property Right, but only to the extent Sharp receives intellectual property indemnification from its [ * ] supplier.

8. Tooling. Danger has commissioned certain tooling for the M-1 project. Such tooling shall remain Danger property and in use by [ * ] to provide parts for M-1. Any action to change or move the tooling shall require the Parties’ mutual written consent. Danger will be responsible for maintaining such tooling up to the production of [ * ] plastic sets. Beyond [ * ] plastic sets, Sharp shall be responsible for tooling maintenance costs and the cost of building additional tooling if production volumes require additional tooling.

9. Test Development. Sharp shall pay for the cost of test development and test equipment in the manufacturing process, unless otherwise agreed by the Parties in writing. Notwithstanding the foregoing, Danger shall, at its expense, provide factory diagnostic testing software for the M-1 Product.

33

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

10. Carrier Approval Process. For the M-1 Product, the parties plan for [ * ] ([ * ]) to be responsible for leading the Carrier Customer approval process. For the M-1 Project, Danger, [ * ], will provide support for the carrier approval process as set forth in Section 5.7 of the Agreement and will [ * ] for a Carrier Customer’s external testing house (e.g. in the case of [ * ] approval process, Danger shall [ * ] by [ * ], [ * ]’s third party test developer).

11. Product Roadmap. The Parties shall meet quarterly, at a minimum, to discuss the evolution of the M-1 project and such other projects of mutual interest.

IN WITNESS WHEREOF, the Parties have caused this Exhibit to be executed as of the Effective Date by their duly authorized representatives.

SHARP CORPORATION		DANGER, INC.
By:	/s/ Hirohide Nakagawa	By:	/s/ Henry R. Nothhaft
Name:	Hirohide Nakagawa	Name:	Henry R. Nothhaft
Title:	Group General Manager of Information and Communication Systems Group	Title:	Chairman & Chief Executive Officer

34

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EXHIBIT A-2

M2 Product Plan

This Exhibit A-2 is executed by Danger, Inc. (“Danger”) and Sharp Corporation (“Sharp”) pursuant to Section 3.2 of the Master Manufacturing and Distribution Agreement by and between Danger and Sharp dated as of April 28, 2004 (the “Agreement”). This Exhibit, when executed by the Parties, shall be binding on the Parties, shall constitute part of the Agreement, and shall be subject to the terms and conditions thereof. All capitalized terms used herein and not otherwise defined in this Exhibit shall have the meanings ascribed to them in the Agreement. In the event of any inconsistencies between the terms of this Exhibit and the terms of the Agreement, the terms of the Exhibit shall be controlling.

1. Product Name.

M2 (also known as the PV200 Series).

2. Product Specifications.

Sharp shall be primarily responsible for the M2 Hardware Specification. Danger shall be primarily responsible for the M2 Software Specification. Each side shall provide support to the other in its area of responsibility as reasonably requested.

HARDWARE SPECIFICATION: Sharp

OS/Application Language	Danger OS 3.0 or its successors, plus applicable updates and new releases.
Size	(W)130 x (D)59 x (H)22mm
Weight	Approx. 190g (Tentative)
CPU	TI: OMAP Application Processor (OMAP331) or its successors. ARM9 core.
Built-in RF	EDGE module (Enfora Keystone EDG0100-02 or its successors) Quad-band (850/900/1800/1900MHz). Due to antenna constraints, the EDGE module will operate only in Tri-band mode - 850/1800/1900MHz or 900/1800/1900MHz)
Built-in Bluetooth	Bluetooth V1.2 compliant, Class 2 Support for Bluetooth Headset, Hands Free, Object push
LCD Display module	Size: 2.6” Resolution: 1/8VGA [ * ] Colors: 65,536. Technology: Amorphous TFT LCD Back light: LED type, 3 step adjustments (exclude light off) Brightness: 24 cd/m2"
Light sensor	Yes
CAMERA	1/4 inch C-MOS Sensor (Fixed focus) 1,280 x 1,024 (SXGA:1.3M pixel) Lens : 3 plastics Distance : 85cm (from infinity to best possible)
Camera FLASH LED	White LED, 10cd (max)

1

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

FROM	512Mbit NAND Flash ROM
RAM	512Mbit SDRAM
SD Slot	Single Mini-SD card slot (Embedded under battery cover)
USB port (Client)	Mini B connector, USB Version 1.1
KEY	QWERTY key board: 47 keys Command button * 4 pcs, D-PAD TRACK Ball with LED (RGB), Page UP/DOWN Side button: Power, Volume +/-, Shoulder Left/Right
Battery lock switch	Yes (Electrical switch will be included)
RGB LED (for Trackball)	RGB LED (separate RGB on trackball flex)
Keyboard Back Light LED	Amber LED *28pcs
LCD Status LED	LCD will turn "off" in sleep mode; RGB LED will turn on to indicate status
Charge LED	LED 1 piece (Color : Orange )
Main Battery	Li-ion battery, 1500mAh (User exchangeable)
Battery life Standby Talk (Voice / Data)	Battery life must meet or exceed the applicable specifications set by T-Mobile USA.
Battery charge	Charge time: 4 hours estimated (RF off and standby mode)
Ringer / Receiver Speaker	Combo speaker (19mm, Ringer and Receiver) Located on the top side of the unit (Under D-pad)
Vibrator	Yes
Microphone	Monaural microphone Located on the top side of the unit.
Audio jack	2.5mm plug Supports stereo headset with monaural microphone and one button (The headset shipped with M2)
Headset	Stereo headset with microphone and hook button
Carrying Case	Yes
AC adapter	Input: 100V - 240V AC, 50/60 Hz Output: 5.15V DC, 1A

2

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

SOFTWARE SPECIFICATION: Danger

OS	Based on hiptop OS and Software Release 3.0 plus applicable updates and new releases.
Phone	Supports handheld, hands-free, Bluetooth, and speakerphone modes Customizable ringtones and Caller ID images Voicemail, Call forwarding, Hold, Mute, Multi-party calling Call log
Web Browser	HTML 4.0 Web Browser, SSL Support, JavaScript Support, Cookies support
E-Mail Client	Push email solution (“Instant email”) Fetch from device account and up to 3 POP3/IMAP accounts Transcoding support for of MS Word, Adobe Acrobat & Image attachments Playback support for WAV sound file attachments
SMS	Short Message Service (SMS) Store messages on device or SIM Card Send/Receive Concatenated SMS Delivery Reports Reply Request
MMS	Multimedia Messaging Service (MMS) (Optional) Compose MMS with up to 3 slides Include a picture, sound, or a 20 second voice note on each slide. Digital Rights Management: Forward Lock
Instant Messaging	AIM, MSN Messenger and Yahoo Messenger clients available (Optional, at additional cost to Carriers) Full Buddy List functionality, Instant Buddy List updates
PIM Applications*	Address Book, Contact sharing through Send/Receive of vCards, Calendar, To Do, Notes, Web interface for PC access to data
Camera gallery	Captures of images from device camera Night mode and supplemental LED options Stores up to 1.75MB of image data in device, or up to the limit of memory on the miniSD Card, Photo Caller ID
Music Player	Organizes and plays MP3 files that the user stores on the miniSD card. Can support additional media formats (e.g. WMA+DRM10) with future OTA.
Gaming & Entertainment	Rock & Rocket game (optional per carrier) Premium Download Manager supports purchase and management of Ringtones and Applications
Additional Data Applications	SIM Application Toolkit, Release 99

3

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

3. Development Schedule.

Below are the key milestone dates that the Parties commit to meet for the M2 project. Sharp shall manage and be responsible for the development, testing and production schedules for the M2 hardware. Danger shall manage and be responsible for the development and testing schedules for the M2 software. The parties shall collaborate and share scheduling information.

[ * ]	Milestones for T-Mobile USA
[ * ]	Sharp ships out ([ * ]) EVT0 units to Danger
[ * ]	Sharp ships out ([ * ]) EVT 1 units to Danger
[ * ]	Software Feature Complete (Danger)
[ * ]	Sharp ships out ([ * ]) EVT2 units to Danger
[ * ]	Sharp ships out ([ * ]) DVT1 units to Danger
[ * ]	Alpha OS software available (Danger)
[ * ]	Sharp ships out ([ * ])PVT units to Danger
[ * ]	Beta OS software available (Danger)
[ * ]	(RC) Release Candidate OS software available (Danger)
[ * ]	(RC) Release Candidate OS #0 software available (Danger)
[ * ]	(RC) Release Candidate OS #1 software available (Danger)
[ * ]	(RC) Release Candidate OS (final) software available (Danger)
[ * ]	Sharp submits final units to T-Mobile for testing
[ * ]	[ * ] approves M2 hardware (proceed with production start)
[ * ]	Sharp ships out ([ * ]) Pre-Production Unit to Danger
[ * ]	[ * ] approves M2 software and issues Terminal Approval (TA)
[ * ]	Sharp ships initial [ * ] units to [ * ] distribution center
[ * ]	Commercial Launch of M2 by [ * ]

4. Prototypes.

Sharp shall provide Danger with [ * ] M2 prototype devices [ * ], allocated as follows: [ * ]] EVT0 units, [ * ]] EVT1 units, [ * ]] EVT2 units, [ * ]] DVT1 units. Upon Danger’s request additional prototype units, Sharp shall provide such units to Danger at [ * ] cost. For Sharp’s providing the additional prototype units, the delivery schedule and pricing will be mutually agreed upon between both Danger and Sharp. Therefore the total requested Danger quantity of prototype devices is:

[ * ]	EVT0
[ * ]	EVT1
[ * ]	EVT2
[ * ]	DVT
[ * ]	PVT
[ * ]	PP

5. Technical Contacts.

4

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Danger		Sharp
Name:	[ * ]	Name:	[ * ]
Title:	SVP of Engineering & Operations	Title:	[ * ]
Tel:	[ * ]	Tel:	[ * ]
Email:	[ * ]	Email:	[ * ]

6. Test Plan.

The parties have identified the regulatory and industry tests listed below for the commercial launch of M2 in the United States. Additional testing, including those for carrier approval processes or for European launch, may also be required. Pursuant to Section 4.3(f)(i) of the Agreement, Sharp shall, at its expense, conduct such tests and Danger shall provide Sharp with reasonable support (described in more detail below) at no charge (except for reimbursement of Danger’s out-of-pocket expenses which Sharp must fully agree in advance).

The parties shall share testing costs as follows:

(a) PTCRB, GCF and Bluetooth Testing. [ * ] shall pay for the lab time testing costs recommended by [ * ] (“X hours”) + up to [ * ] hours of additional lab time for follow-up testing. The additional testing (up to [ * ] hours) is to be expected as follow-up on the initial [ * ] testing. If additional testing, above X + [ * ] hours (“Overtime”), is required [ * ], then [ * ] will pay the Overtime test costs. [ * ] pay for Overtime test costs related to [ * ] issues. If Overtime testing is required because of [ * ] software problems, then Sharp and Danger will request [ * ] to pay for such Overtime test costs. If [ * ] refuses, Sharp shall manage [ * ] to reach a suitable resolution.

Note: the [ * ] estimate for testing will need to be confirmed by Danger and Sharp as a reasonable estimate.

(b) Carrier Testing. [ * ] will pay for up to [ * ] hours testing lab time for each carrier. (This includes, but is not limited to costs of [ * ] for [ * ]). Additional testing needed above [ * ] hours will be paid for by [ * ]; however, if it is determined that the problem causing the need for such additional testing is [ * ], then [ * ] shall reimburse [ * ] for the costs of such additional testing. For carrier customers to whom Danger provides M2 directly, [ * ] be responsible for any of the expenses for the carrier approval testing, unless otherwise agreed upon in writing by Danger and Sharp. If [ * ] and/or [ * ] reach business agreement with Sharp to purchase Products from Sharp, [ * ] will look after the testing costs for those carriers that purchase Products from Sharp.

(c) FCC and CE Testing. [ * ] shall pay for all [ * ] test costs.

Danger shall provide the following support for testing:

Danger will provide full support to Sharp Corporation in the area of compliance testing and certification, utilizing the experience gained on previous Danger projects. Danger will provide a specification document providing details of government regulatory and specific industry mandatory requirements that must be met in order to ship a product. Danger will also

5

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

manage the acceptance process for the embedded GSM and Bluetooth radio modules and verify that all required government and industry compliance tests are completed by those suppliers.

For GSM industry approval (and PTCRB and GCF, if required), Danger will supply engineering resources to attend the testing on-site without charge for any testing booked at [ * ] at [ * ]. Engineering resources may be available to support testing at other laboratories (including [ * ] in [ * ]) and locations provided that Sharp Corporation covers any travel related expenses for Danger’s Palo Alto, CA based personnel. Any travel related expenses shall be discussed and confirmed with Sharp prior to being incurred. In addition, Danger will provide feedback and analysis of test results obtained by Sharp throughout the product development cycle to aid the resolution of any test failures that occur.

Danger will have the right to use the test results internally for product management and planning purposes. In the event that Danger wishes to disclose this data for the purpose of establishing new carrier customers, Danger shall acquire Sharp’s written consent in advance.

The following schedule is based on the agreed schedule of [ * ]/Danger/Sharp.

Government Regulation

Category	Description / Title	Owner	Schedule
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]

Industry Certification

Category	Description / Title	Owner	Schedule
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]

6

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

[ * ] Authentication

Category	Description / Title	Owner	Schedule
[ * ]	[ * ]	[ * ]	[ * ]

7. Danger Technology.

For this M2 Project Plan, the following Danger Design Technology and Danger Software is licensed to Sharp under the terms of the Agreement.

(a) Hardware Design: The “hinge” design for use in M2.

Notwithstanding Section [ * ] of the Agreement, [ * ] does not provide [ * ] any [ * ] for [ * ] for the M2 Product. Although [ * ] does not provide [ * ] to [ * ] for [ * ] for M2, if the M2 [ * ] becomes subject to the [ * ], [ * ] will pay for the [ * ] until the [ * ] or [ * ] the potential liability for the M-1 Products. [ * ] has elected to negotiate separately with [ * ] to resolve potential liability for the M-2 Product and therefore will be responsible for any [ * ] if the [ * ] continues following [ * ] of the potential liability for the M-1 Product. [ * ] shall be responsible for [ * ] for M2 resulting from any [ * ] or any [ * ] that [ * ] agrees to (such agreement not to be unreasonably withheld). [ * ] may participate in the [ * ] at its expense following consultation with [ * ].

Although [ * ] does not [ * ] [ * ] for the M-2 Product under Section [ * ] of the Agreement, [ * ] hereby agrees to [ * ] and [ * ] from any [ * ] for [ * ] that the [ * ] used for the M-2 Product [ * ] infringed a third party’s patent. [ * ] obligation under this paragraph shall be contingent on [ * ] providing [ * ] prompt notice of any such claim and allowing [ * ] to participate, at [ * ], in the defense of any such claim.

(b) Danger Client Software: Based on hiptop OS and Software Release 3.0 or its successors.

8. Sales and Marketing Terms.

(a) Sharp and Danger shall meet quarterly to develop and implement a sales plan for M2 that will include but not be limited to the following:

i. A list of prospective carrier/operators as well as key contacts at those operators. For planning purposes, Sharp and Danger will target major [ * ] Operators in [ * ] as prospective customers for M2.

ii. A schedule of joint sales calls with key influencers and decision makers at these prospect accounts. Sharp and Danger will make sales staff available for at least 1 sales call per prospective account per quarter.

iii. A plan for internal user trials, technical trials, end user trials and market trials for these prospects.

iv. Developing and proactively presenting proposals for commercials terms to each of the prospective carriers/operators as appropriate during the sales process.

(b) Sharp shall provide [ * ] production units of M2 for pre-sales marketing and technical feasibility trials to prospective carrier customers that the parties mutually agree to.

7

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Sharp shall provide such units to the prospective carrier customers directly, but in cooperation with Danger which shall provide appropriate software and service accounts for the units.

9. Other Product Details.

(a) Hardware Design Changes.

In the event that Sharp decides to change any portion of hardware that has any software impact, Sharp shall provide a reasonable number of additional units free of charge to Danger for testing. The number of additional units shall be mutually agreed to by the parties.

(b) Design Patent.

Sharp and Danger agree to file application(s) for design patent(s)/design registration rights on the M2 exterior design in order to prevent the sale and distribution of imitation models by third parties. The M2 exterior design shall be considered a [ * ]. [ * ] will prepare applications for design patent(s) at [ * ] cost. The design patents shall be filed in [ * ] names. The parties shall [ * ] of filing the design patents in the following countries: China, Japan, European Union (UK and Germany) and the United States. The parties shall mutually agree in writing before filing design patent applications in any other jurisdictions. The parties shall [ * ] of maintaining such patents.

Notwithstanding the foregoing, with respect to any design patent that issues for M2, the parties will mutually discuss whether to enforce or defend such patent rights. If the parties agree to jointly enforce or defend such patent rights, they shall share equally in the costs and awards/settlements. If a party refuses to take any such joint action requested by the other, the other may proceed at its own expense and the party refusing to take action will similarly assist such other party; no such action will change the foregoing ownership provisions, but a party that unilaterally enforces the joint patent rights (after refusal by the other to do so jointly) will be entitled to retain all proceeds of such action.

(c) Manufacturing Rights.

The terms and conditions related to Sharp’s Manufacturing Rights for M2 shall be governed by 6.6 of the Agreement.

(d) Software License Fees.

The Parties agree that following third party licensing costs are [ * ]:

1. [ * ]

Sharp may choose to pay the licensing fees directly to the aforementioned third parties, or may have Danger pay them and reimburse Danger on a per unit shipped basis.

If future carrier customer requirements require payment of third party costs in addition to those identified above, Danger and Sharp shall discuss how to allocate such costs. For example, if a new royalty bearing feature is requested by a Carrier and [ * ] has a [ * ] for such additional [ * ] (e.g. [ * ]) then the parties may agree for [ * ] However, if due to Carrier or technical requirements the feature must be [ * ], then the parties may agree to have [ * ].

8

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Notwithstanding the foregoing, the parties shall remain liable for certain intellectual property infringement matters (e.g. litigation costs, damages, and license fees, if any) as stated in the Agreement and this Product Plan.

Sharp acknowledges that the [ * ] technology and the [ * ] technology are owned by [ * ] and cannot be used or distributed further without a license from [ * ] or a [ * ]

SHARP CORPORATION		DANGER, INC.
By:	/s/ Hirohide Nakagawa	By:	/s/ Henry R. Nothhaft
	Hirohide Nakagawa		Henry R. Nothhaft
	Group General Manager of Information and Communication Systems Group		Chairman & Chief Executive Officer

9

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EXHIBIT A-3

S1 Product Plan

This Exhibit A-3 is executed by Danger, Inc. (“Danger”) and Sharp Corporation (“Sharp”) pursuant to Section 3.2 of the Master Manufacturing and Distribution Agreement by and between Danger and Sharp dated as of April 28, 2004 (the “Agreement”). This Exhibit, when executed by the Parties, shall be binding on the Parties, shall constitute part of the Agreement, and shall be subject to the terms and conditions thereof. All capitalized terms used herein and not otherwise defined in this Exhibit shall have the meanings ascribed to them in the Agreement. In the event of any inconsistencies between the terms of this Exhibit and the terms of the Agreement, the terms of the Exhibit shall be controlling.

1. Product Name.

S1 (also known as the PV150 Series).

In the event the Parties choose to sell S1 outside of North America they will allocate costs associated with testing and launching for international markets as they’ve done for previous Products.

2. Product Specifications.

Sharp shall be primarily responsible for the S1 Hardware Specification. Danger shall be primarily responsible for the S1 Software Specification. Each side shall provide support to the other in its area of responsibility as reasonably requested.

HARDWARE SPECIFICATION: Sharp

Size	(W)130 x (D)63 x (H)22.2mm
Weight	Approx. 176g
CPU	TI: OMAP Application Processor (OMAP331). ARM9 core./Bus 16bit
Built-in RF	Enfora Whistler radio module, a dual band radio (850/1900MHz).
Built-in Bluetooth	NA
LCD Display Module	Size: 2.4” Resolution: 1/8VGA [ * ] Colors: 65,536. Technology: Transflective TFT Backlight: LED type, 3-step adjustment (excluding the backlight-off mode). Brightness: 28 cd/m2”
Light Sensor	No
Flash ROM	512Mbit NAND Flash ROM
RAM	512Mbit SDRAM
USB port (Client)	Mini B connector, USB Version 1.1 only for manufacturing/Not for end-user
KEY	QWERTY key board: 47 keys Command button * 4 pcs, D-PAD TRACK Ball with LEDs (RGB), Page UP/DOWN Side button: Power, Volume +/-, Shoulder Left/Right
Battery Lock Switch	Yes (Electrical switch included)
RGB LED (for Trackball)	RGB LED (separate RGB on trackball flex)
Keyboard Back Light LED	Amber LED *28pcs
Charge LED	LED 1 piece (Color : Orange )
Main Battery	Li-ion battery, 1500mAh (User exchangeable)
Battery life Standby Talk (Voice / Data)	Target: More than 72Hrs    More than 4.5Hrs
Battery charge	Charge time: 4 hours estimated (RF off and standby mode)
Ringer / Receiver Speaker	Combo speaker (17mm, Ringer and Receiver) Located on the top side of the unit (Under D-pad)
Vibrator	Yes

1

[*] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Microphone	Monaural microphone Located on the top side of the unit.
Audio jack	2.5mm plug. Mono audio support and one button
Headset	Mono headset without button
Carrying Case	Yes/ New design
AC charger	Input: 100V - 240V AC, 50/60 Hz Output: 5.15V DC, 1A
Other accessories	Battery pack (1500mAh)x1, start guide x 1 , reference guide x 1, T’s&C’s Limited warranty x 1 (No USB cable included)

SOFTWARE SPECIFICATION: Danger

OS	Based on hiptop OS and Software Release 3.3
Phone	Supports handheld, hands-free, and speakerphone modes Customizable ringtones and Caller ID images Voicemail, Call forwarding, Hold, Mute, Multi-party calling Call log
Web Browser	HTML 4.0 Web Browser, SSL Support, JavaScript Support, Cookies support
E-Mail Client	Push email solution (“Instant email”) Fetch from device account and up to 3 POP3/IMAP accounts Transcoding support for of MS Word, Adobe Acrobat & Image attachments Playback support for WAV sound file attachments Save Image attachments to Image Gallery
SMS	Short Message Service (SMS) Store messages on device or SIM Card Send/Receive Concatenated SMS Delivery Reports Reply Request
MMS	Multimedia Messaging Service (MMS) (available as a post-launch option via OTA) Compose MMS with up to 3 slides Include a picture, sound, or a 20 second voice note on each slide. Digital Rights Management: Forward Lock
Instant Messaging	AIM, MSN Messenger and Yahoo Messenger clients available (Optional, at additional cost to Carriers) Full Buddy List functionality, Instant Buddy List updates
PIM Applications*	Address Book, Contact sharing through Send/Receive of vCards, Calendar, To Do, Notes, Web interface for PC access to data
“My Faves” Application	Included for T-Mobile USA units (Rich Feature Set version at launch)
Image gallery	Stores up to 1.75MB of image data in device, Can be used for Photo Caller ID, attach image to email, IM buddy icon, myFaves (available as a post-launch option via OTA) Requires users to input images via e-mail attachments.
Gaming & Entertainment	Pumpjack game (optional per carrier) Premium Download Manager supports purchase and management of Ringtones and Applications

3. Development Schedule.

Below are the key milestone dates that the Parties commit to meet for the S1 project. Sharp shall manage and be responsible for the development, testing and production schedules for the S1 hardware. Danger shall manage and be responsible for the development and testing schedules for the S1 software. The parties shall collaborate and share scheduling information.

Date Milestones for T-Mobile USA

2

[*] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

[ * ]	Sharp ships out ([ * ]) EVT1 units to Danger
[ * ]	Sharp ships out ([ * ]) DVT0 units to Danger
[ * ]	Sharp ships out ([ * ]) DVT1 units to Danger
[ * ]	[ * ] delivers candidate radio firmware to Danger
[ * ]	Sharp ships ([ * ]) early PVT0 units for memory testing to Danger
[ * ]	Sharp ships out ([ * ])PVT0 units to Danger
[ * ]	Software Feature Complete declare (Danger)
[ * ]	Final Candidate Firmware from [ * ] delivered to Sharp & Danger
[ * ]	Alpha OS software declare (Danger)
[ * ]	Sharp ships out ([ * ]) PVT2 units to Danger
[ * ]	Beta OS software declare (Danger)
[ * ]	(RC) Release Candidate OS software available (Danger)
[ * ]	Factory Package to be delivered to Sharp (Danger)
[ * ]	Sharp submits final units to T-Mobile for testing
[ * ]	[ * ] approves S1 hardware (proceed with production start)
[ * ]	Sharp ships out ([ * ]) Pre-Production Unit to Danger
[ * ]	[ * ] approves S1 software and issues Terminal Approval (TA)
[ * ]	Sharp ships initial [ * ] units to [ * ] distribution center
[ * ]	Commercial Launch of S1 by [ * ]

4. Prototypes.

Sharp shall provide Danger with the following S1 prototype devices and also provide details all hardware changes between revisions. Upon Danger’s request for additional prototype units, Sharp shall provide such units to Danger at [ * ] For Sharp’s providing the additional prototype units, the delivery schedule and pricing will be mutually agreed upon between both Danger and Sharp. Therefore the total requested Danger quantity of prototype devices is:

Device	Number [ * ]	Number [ * ]
DVT0	[ * ]	[ * ]
DVT1	[ * ]	[ * ]
PVT0	[ * ]	[ * ]
PVT2*	[ * ]	[ * ]

In addition, Sharp made available to Danger the following additional number of units free of charge. This is a [ * ] beyond the requirement of [ * ] free units in the Agreement.

Device	Number [ * ]
EVT1	[ * ]
Early PVT0 (for memory testing)	[ * ]

5. Technical Contacts.

Danger		Sharp
Name:	[ * ]	Name:	[ * ]
Title:	SVP of Engineering	Title:	Division General Manager, Wireless Convergence division of ICSG
Tel:	[ * ]	Tel:	[ * ]
Email:	[ * ]	Email:	[ * ]

6. Test Plan.

3

[*] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

The parties have identified the regulatory and industry tests listed below for the commercial launch of S1 in the United States. Additional testing, including those for carrier approval processes, may also be required. Pursuant to Section 4.3(f)(i) of the Agreement, Sharp shall, at its expense, conduct such tests and Danger shall provide Sharp with reasonable support (described in more detail below) at no charge (except for reimbursement of Danger’s out-of-pocket expenses which Sharp must agree in advance).

The parties shall share testing costs as follows:

PTCRB, Testing. [ * ] shall pay for the lab time testing costs recommended by [ * ] (“X hours”) + up to [ * ] hours of additional lab time for follow-up testing. The additional testing (up to [ * ] hours) is to be expected as follow-up on the initial [ * ] testing. If additional testing, above X + [ * ] hours (“Overtime”), is required [ * ], then [ * ] will pay the Overtime test costs. [ * ] pay for Overtime test costs related to [ * ] issues. If Overtime testing is required because of [ * ] software defects, then Sharp and Danger will request [ * ] to pay for such Overtime test costs. If [ * ] refuses, Sharp shall manage [ * ] to reach a suitable resolution.

Note: the [ * ] estimate for testing will need to be confirmed by Danger and Sharp as a reasonable estimate.

(a) Carrier Testing. [ * ] will pay for up to [ * ] hours testing lab time for each carrier. (This includes, but is not limited to costs of [ * ] for [ * ]). Additional testing needed above [ * ] hours will be paid for by [ * ]; however, if it is determined that the problem causing the need for such additional testing is [ * ], then [ * ] shall reimburse [ * ] for the costs of such additional testing. For carrier customers to whom Danger provides S1 directly, [ * ] be responsible for any of the expenses for the carrier approval testing, unless otherwise agreed upon in writing by Danger and Sharp.

(b) FCC Testing. [ * ] shall pay for all [ * ] test costs.

Danger shall provide the following support for testing:

Danger will provide full support to Sharp Corporation in the area of compliance testing and certification, utilizing the experience gained on previous Danger projects. Danger will provide a specification document providing details of government regulatory and specific industry mandatory requirements that must be met in order to ship a product. Sharp will provide Danger with a copy of all pre-compliance (internal) as well as official test results and reports (external) obtained as part of the compliance verification process.

For GSM industry approval (PTCRB), Danger will supply engineering resources to attend the testing on-site without charge for any testing booked at [ * ] at [ * ]. Engineering resources may be available to support testing at other laboratories (including [ * ] in [ * ]) and locations provided that Sharp Corporation covers any travel related expenses for Danger’s Palo Alto, CA based personnel. Any travel related expenses shall be discussed and confirmed with Sharp prior to being incurred. In addition, Danger will provide feedback and analysis of test results obtained by Sharp throughout the product development cycle to aid the resolution of any test failures that occur.

Danger will have the right to use the test results internally for product management and planning purposes. In the event that Danger wishes to disclose this data for the purpose of establishing new carrier customers, Danger shall acquire Sharp’s written consent in advance.

The following schedule is based on the agreed schedule of [ * ]/Danger/Sharp.

Government Regulation

Category	Description / Title	Owner	Schedule
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]	[ * ]
	[ * ]	[ * ]	[ * ]

Industry Certification

Category	Description / Title	Owner	Schedule
[ * ]	[ * ]	[ * ]	[ * ]

4

[*] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]

* Danger shall assist Sharp in conducting the test.

7. Danger Technology.

For this S1 Project Plan, the following Danger Software is licensed to Sharp under the terms of the Agreement: Danger Client Software - Based on hiptop OS and Software Release 3.3 or its successors.

For this S1 Project Plan, the hardware design of the S1 Product, including the “hinge” design for use in S1, will be considered Sharp Design Technology.

8. Sales and Marketing Terms.

(a) Sharp and Danger shall meet quarterly to develop and implement a sales plan for S1 that will include but not be limited to the following:

i. A list of prospective carrier/operators as well as key contacts at those operators.

ii. A schedule of joint sales calls with key influencers and decision makers at these prospect accounts. Sharp and Danger will make sales staff available for at least 1 sales call per prospective account per quarter.

iii. A plan for internal user trials, technical trials, end user trials and market trials for these prospects.

iv. Developing and proactively presenting proposals for commercials terms to each of the prospective carriers/operators as appropriate during the sales process.

(b) If the parties agree to make the S1 Product available outside of North America, Sharp shall provide [ * ] production units of S1 for pre-sales marketing and technical feasibility trials to prospective carrier customers that the parties mutually agree to. Sharp shall provide such units to the prospective carrier customers directly, but in cooperation with Danger which shall provide appropriate software and service accounts for the units.

9. Other Product Details.

(a) Hardware Design Changes.

In the event that Sharp decides to change any portion of hardware (including but not limited to mechanical or electrical changes) that has any software impact, Sharp shall provide a reasonable number of additional units free of charge to Danger for testing. The number of additional units shall be mutually agreed to by the parties.

(b) Design Patent.

Sharp agrees to file application(s) for design patent(s)/design registration rights on the S1 exterior design in order to prevent the sale and distribution of imitation models by third parties. Sharp will prepare applications for design patent(s) at Sharp’s cost. The design patents shall be filed in Sharp’s name as Sharp is responsible for the S1 hardware design.

(c) Manufacturing Rights.

The terms and conditions related to Sharp’s Manufacturing Rights for S1 shall be governed by 6.6 of the Agreement.

(d) Software License Fees.

The Parties agree that following third party licensing costs are to be included in the handset pricing to operators:

1. [ * ]

5

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Sharp shall pay the licensing fees directly to the aforementioned third parties, or with Danger’s prior agreement, may reimburse Danger after Danger pays.

If future carrier customer requirements require payment of third party costs in addition to those identified above, Danger and Sharp shall discuss how to allocate such costs. For example, if a new royalty bearing feature is requested by a Carrier and [ * ] has a [ * ] for such additional [ * ] (e.g. [ * ] then the parties may agree for [ * ]. However, if due to Carrier or technical requirements the feature must be [ * ], then the parties may agree to have [ * ]. [ * ] shall not have to pay any such additional royalty for a new feature [ * ] unless [ * ] agrees in writing to pay such royalty. The parties shall discuss any such royalty prior to implementation of the feature.

Notwithstanding the foregoing, the parties shall remain liable for certain intellectual property infringement matters (e.g. litigation costs, damages, and license fees, if any) as stated in the Agreement and this Product Plan.

SHARP CORPORATION		DANGER, INC.
By:	/s/ Masami Ohbatake	By:	/s/ Henry R. Nothhaft
	Masami Ohbatake		Henry R. Nothhaft
	Group General Manager		Chairman & Chief Executive Officer

6

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EXHIBIT A-4

SHURIKEN Product Plan

This Exhibit A-4 is executed by Danger, Inc. (“Danger”) and Sharp Corporation (“Sharp”) pursuant to Section 3.2 of the Master Manufacturing and Distribution Agreement by and between Danger and Sharp dated as of April 28, 2004 (the “Agreement”). This Exhibit, when executed by the Parties, shall be binding on the Parties, shall constitute part of the Agreement, and shall be subject to the terms and conditions thereof. All capitalized terms used herein and not otherwise defined in this Exhibit shall have the meanings ascribed to them in the Agreement. In the event of any inconsistencies between the terms of this Exhibit and the terms of the Agreement, the terms of the Exhibit shall be controlling.

1. Product Name.

SHURIKEN (also known as the PV250 M2HD Series).

In the event the Parties choose to sell SHURIKEN outside of North America they will allocate costs associated with testing and launching for international markets as they’ve done for previous Products.

2. Product Specifications.

Sharp shall be primarily responsible for the SHURIKEN Hardware Specification. Danger shall be primarily responsible for the SHURIKEN Software Specification. Each side shall provide support to the other in its area of responsibility as reasonably requested.

HARDWARE SPECIFICATION: Sharp

Size	Approx. (W)130 x (D)61 x (H)18mm
Color	Blue w/ Blue “Mood” LED (PV250A) Brown w/ Blue “Mood” LED (PV250B)
Weight	Approx. 164g with battery pack / without SIM/ microSD
CPU	TI: OMAP Application Processor (OMAP331) ARM9 core./Bus16bit
Built-in RF	Enfora Keystone radio module, Quad-band radio (850/900/1800/1900MHz)
Built-in Bluetooth	Bluetooth Ver.2.0 compliant, Class2 Support for Bluetooth Headset, Hands Free, Object push
LCD Display Module	Size: 3.0” Resolution: WQVGA 400(H) * RGB * 240(V) pixels Colors: 65,536 Technology: Mobile ASV, TFT Backlight: LED type, 3-step adjustment (excluding the backlight-off mode) Brightness: Max 250cd/m2”
Light Sensor	Yes
CAMERA	1/4 inch C-MOS Sensor (Fixed focus) 1280 x 1024 (SXGA : 1.3M pixel) Lens : 3 plastics
Camera FLASH LED	White LED, 10cd (max)
Flash ROM	512Mbit NAND Flash ROM
RAM	512Mbit DDRSDRAM
SD Slot	Single Micro-SD card slot
USB port (Client)	Mini B connector, USB Version 2.0
KEY	QWERTY key board: 47 keys Command button * 4 pcs, D-PAD TRACK Ball with LEDs (RGB), Page UP/DOWN Side button: Power, Volume +/-, Shoulder Left/Right
Battery Lock Switch	Yes (Electrical switch included)
RGB LED (for Trackball)	RGB LED (separate RGB on trackball flex)
Keyboard Back Light LED	White LED *4pcs
Illumination(Mood) LED	Blue *4pcs for both models:PV250A/PV250B
Charge LED	LED 1 piece (Color : Orange )
Main Battery	Li-ion battery, 1540mAh (User exchangeable, new battery)

1

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Battery life
Standby	Approx. 144Hrs (6days)
Talk (Voice / Data)	Approx. 5Hrs
	Charge time: 4 hours estimated (RF off and standby mode)
Ringer / Receiver Speaker	Combo speaker (16mm, Ringer and Receiver) Located on the top side of the unit (Under D-pad)
Vibrator	Yes
Microphone	Monaural microphone Located on the lower left side of the unit.
Audio jack	3.5mm plug. Supports stereo headset with monaural microphone and one Button (The headset shipped with SHURIKEN)
Headset	Stereo headset with microphone and hook button
Carrying Case	Yes
AC charger	Input: 100V - 240V AC, 50/60 Hz Output: 5.5 V DC, 1A,USB Mini B type plug
Other accessories	Battery pack (1540mAh)x1, manual folder x1, start guide fold-out poster x 1 , reference guidex1, T’s&C’s Limited warranty x 1, USB cable x1, headset x 1,AC Adapter x1, 128MB microSD memory card x1, carrying case x1
Software Security	External interfaces accessible by the end user must not permit loading of unauthorized software (e.g. JTAG pads not accessible without disassembly of device; USB boot loader not enabled without disassembly of device, except by Danger Software).
SOFTWARE SPECIFICATION: Danger
OS	Based on hiptop OS and Software Release 4.4
Phone	Supports handheld, hands-free, and speakerphone modes Customizable ringtones and Caller ID images Voicemail, Call forwarding, Hold, Mute, Multi-party calling Call log
Web Browser	HTML 4.0 Web Browser, SSL Support, JavaScript Support, Cookies support
E-Mail Client	Push email solution (“Instant email”) Fetch from device account and up to 3 POP3/IMAP accounts Transcoding support for of MS Word, Adobe Acrobat & Image attachments Playback support for WAV sound file attachments Save Image attachments to Image Gallery
SMS	Short Message Service (SMS) Store messages on device or SIM Card Send/Receive Concatenated SMS Delivery Reports Reply Request
MMS	Multimedia Messaging Service (MMS) (Optional, per carrier) Compose MMS with up to 3 slides Include a picture, sound, or a 20 second voice note on each slide. Digital Rights Management: Forward Lock
Instant Messaging	AIM, MSN Messenger and Yahoo Messenger clients available (Optional, at additional cost to Carriers) Full Buddy List functionality, Instant Buddy List updates
PIM Applications*	Address Book, Contact sharing through Send/Receive of vCards, Calendar, To Do, Notes, Web interface for PC access to data
“My Faves” Application	Included for T-Mobile USA units
Image gallery	Stores up to 1.75 MBof image data in device, Can be used for Photo Caller ID, attach image to email, IM buddy icon, My Faves.
Gaming & Entertainment	Bob’s Journey (optional per carrier) Premium Download Manager supports purchase and management of Ringtones and Applications

2

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

[ * ] Support Parties to determine whether [ * ] features will be supported on the Product (e.g. not supported, [ * ]) and the means for delivering the features to Product already shipped.

3. Development Schedule.

Below are the key milestone dates that the Parties commit to meet for the SHURIKEN project. Sharp shall manage and be responsible for the development, testing and production schedules for the SHURIKEN hardware. Danger shall manage and be responsible for the development and testing schedules for the SHURIKEN software. The parties shall collaborate and share scheduling information.

Date	Milestones for T-Mobile USA
[ * ]	Sharp ships out ([ * ]) EVT2 to Danger w/Sharp USB charging rework
[ * ]	Sharp ships out ([ * ]) EVT3 PCB units to Danger
[ * ]	Sharp ships out ([ * ]) EVT3(Navi-style) units to Danger
[ * ]	Sharp ships out ([ * ]) EVT3 handmade cabinet unit to Danger
[ * ]	Software Feature Complete declared on EVT2 (except mood lights)
[ * ]	Software Alpha declared on DVT
[ * ]	Sharp ships ([ * ]) DVT1 to Danger
[ * ]	Sharp ships out ([ * ]) PVT1 units to Danger
[ * ]	Sharp ships out ([ * ]) PVT2 units to Danger
[ * ]	Software Beta declared on PVT1
[ * ]	Software Release for Test Cycle 1
[ * ]	Software Release Candidate for Test Cycle 2
[ * ]	Software Release for Test Cycle 3 and Factory Package delivered to Sharp
[ * ]	Sharp ships out ([ * ]) PP units to Danger
[ * ]	Sharp submits final units to [ * ] for testing
[ * ]	[ * ] approves Shuriken hardware (proceed with production start)
[ * ]	[ * ] approves Shuriken software and issues Terminal Approval (TA)
[ * ]	Mass Production starts
[ * ]	Sharp ships initial [ * ] units to T-Mobile distribution center
[ * ]	Commercial Launch of Shuriken by [ * ]

4. Prototypes.

Sharp shall provide Danger with the following SHURIKEN prototype devices and also provide details of all hardware changes between revisions. For Sharp’s providing the additional prototype units, the delivery schedule and pricing will be mutually agreed upon between both Danger and Sharp. Therefore, at the time this Product Plan is executed, the total requested Danger quantity of prototype devices is:

Device	Number [ * ]	Number [ * ]
EVT2	[ * ]	[ * ]
EVT3	[ * ]	[ * ]
DVT1	[ * ]	[ * ]
PVT1	[ * ]	[ * ]
PVT2	[ * ]	[ * ]
PP	[ * ]	[ * ]

In addition, Sharp made available to Danger the following additional number of units [ * ] to accelerate the development schedule of software. This is a [ * ] beyond the requirement of [ * ] in the Agreement.

Device	Number Free of Charge
EVT3 (NAVI-style)	[ * ]
DVT1	[ * ]

3

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

5. Technical Contacts.

Danger		Sharp
Name:	Les Hamilton	Name:	[ * ]
Title:	SVP of Engineering	Title:	[ * ]
Tel:	650-289-6605	Tel:	[ * ]
Email:	les@danger.com	Email:	[ * ]

6. Test Plan.

The parties have identified the regulatory and industry tests listed below for the commercial launch of SHURIKEN in the United States. Additional testing, including those for carrier approval processes, may also be required. Pursuant to Section 4.3(f)(i) of the Agreement, Sharp shall, at its expense, conduct such tests and Danger shall provide Sharp with reasonable support (described in more detail below) at no charge (except for reimbursement of Danger’s out-of-pocket expenses which Sharp must agree in advance).

The parties shall share testing costs as follows:

PTCRB, Testing. [ * ] shall pay for the lab time testing costs recommended by the PTCRB approved test lab selected by Sharp (“X hours”) + up to [ * ] hours of additional lab time for follow-up testing. The additional testing (up to [ * ] hours) is to be expected as follow-up on the initial testing. If additional testing, above X + [ * ] hours (“Overtime”), is required [ * ], then [ * ] will pay the Overtime test costs. [ * ] pay for Overtime test costs related to [ * ] issues. If Overtime testing is required because of [ * ] software defects, then Sharp and Danger will request [ * ] to pay for such Overtime test costs. If [ * ] refuses, Sharp shall manage [ * ] to reach a suitable resolution.

Note: the test lab’s estimate for testing will need to be confirmed by Danger and Sharp as a reasonable estimate.

(a) Carrier Testing. [ * ] will pay for up to [ * ] hours testing lab time for each carrier. (This includes, but is not limited to costs for [ * ]’s test lab). Additional testing needed above [ * ] hours will be paid for by [ * ]; however, if it is determined that the problem causing the need for such additional testing is [ * ], then [ * ] shall reimburse Sharp for the costs of such additional testing. For carrier customers to whom Danger provides Shuriken directly, [ * ] be responsible for any of the expenses for the carrier approval testing, unless otherwise agreed upon in writing by Danger and Sharp.

(b) Legally Required Tests. Sharp shall pay for all legally required test and approval costs (e.g. FCC/IC).

Danger shall provide the following support for testing:

Danger will provide full support to Sharp Corporation in the area of compliance testing and certification, utilizing the experience gained on previous Danger projects. Sharp will provide Danger with a copy of all pre-compliance (internal) as well as official test results and reports (external) obtained as part of the compliance verification process.

For GSM industry approval (PTCRB), will be managed by Sharp and [ * ]. Danger will supply engineering resources to attend the testing on-site without charge for any testing booked at [ * ] at [ * ]. Engineering resources may be available to support testing at other laboratories (including [ * ] in the [ * ]) and locations provided that Sharp Corporation covers any travel related expenses for Danger’s Palo Alto, CA based personnel. Any travel related expenses shall be discussed and confirmed with Sharp prior to being incurred. In addition, Danger will provide feedback and analysis of test results obtained by Sharp throughout the product development cycle to aid the resolution of any test failures that occur.

Danger will have the right to use the test results internally for product management and planning purposes. In the event that Danger wishes to disclose this data for the purpose of establishing new carrier customers, Danger shall acquire Sharp’s written consent in advance.

The following schedule is based on the agreed schedule of [ * ]/Danger/Sharp.

Government Regulation

Category	Description / Title	Owner	Schedule
[ * ]	[ * ]	[ * ]

4

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

	[ * ]	[ * ]
	[ * ]	[ * ]
	[ * ]	[ * ]
	[ * ]	[ * ]
	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]

Industry Certification

Category	Description / Title	Owner	Schedule
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]

* Danger shall assist Sharp in conducting the test.

** The parties shall work together to resolve [ * ] issues. Sharp shall manage [ * ] to ensure that the [ * ] meets FTA requirements. Danger shall provide Sharp with reasonable assistance in evaluating [ * ] issues.

7. Technology.

For this SHURIKEN Project Plan, the following Danger Software is licensed to Sharp under the terms of the Agreement: Danger Client Software—Based on hiptop OS and Software Release 4.4 or its successors.

For this SHURIKEN Project Plan, the hardware design of the SHURIKEN Product, including the “hinge” design for use in SHURIKEN, will be considered Sharp Design Technology. Danger agrees not to assert any of Danger’s “hinge” related patents or require fees from Sharp for such patent rights for Sharp’s manufacture and sale of the Product.

8. Sales and Marketing Terms.

(a) Sharp and Danger shall meet quarterly to develop and implement a sales plan for SHURIKEN that will include but not be limited to the following:

i. A list of prospective carrier/operators as well as key contacts at those operators.

ii. A schedule of joint sales calls with key influencers and decision makers at these prospect accounts. Sharp and Danger will make sales staff available for at least 1 sales call per prospective account per quarter.

iii. A plan for internal user trials, technical trials, end user trials and market trials for these prospects.

iv. Developing and proactively presenting proposals for commercials terms to each of the prospective carriers/operators as appropriate during the sales process.

(b) If the parties agree to make the SHURIKEN Product available outside of North America, Sharp shall provide [ * ] production units of SHURIKEN for pre-sales marketing and technical feasibility trials to prospective carrier customers that the parties mutually agree to. Sharp shall provide such units to the prospective carrier customers directly, but in cooperation with Danger which shall provide appropriate software and service accounts for the units.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

9. Other Product Details.

(a) Hardware Design Changes.

In the event that Sharp decides to change any portion of hardware (including but not limited to mechanical or electrical changes) that has any software impact, Sharp shall provide a reasonable number of additional units free of charge to Danger for testing. The number of additional units shall be mutually agreed to by the parties. In addition, the software development schedule will be reasonably adjusted for any hardware changes that have software impact.

(b) Design Patent.

Sharp agrees to file application(s) for design patent(s)/design registration rights on the SHURIKEN exterior design in order to prevent the sale and distribution of imitation models by third parties. Sharp will prepare applications for design patent(s) at Sharp’s cost. The design patents shall be filed in Sharp’s name as Sharp is responsible for the SHURIKEN hardware design.

(c) Manufacturing Rights.

The terms and conditions related to Sharp’s Manufacturing Rights for SHURIKEN shall be governed by 6.6 of the Agreement.

(d) License Fees.

The Parties agree that following third party licensing costs are to be included in the handset pricing to operators:

1. [ * ]

Sharp shall pay the licensing fees directly to the appropriate third parties, or with Danger’s prior agreement, may reimburse Danger after Danger pays. Sharp also agrees to [ * ] connection with any of the above technologies. Except as related to the technologies above and Sharp’s obligations under Section [ * ] and [ * ] of the Agreement, Sharp shall have no [ * ] for applications that Danger makes available to Subscribers through [ * ] [ * ] shall not have to pay any such additional [ * ] unless [ * ] agrees in writing to pay such royalty. The parties shall discuss any such royalty prior to implementation of the feature.

Regarding [ * ], the parties acknowledge that Sharp’s responsibility to pay royalties for the entire shipment quantity is contingent on Sharp’s approval of the [ * ] for the Product, such approval not to be unreasonably withheld. The parties shall mutually agree to specifications and test files to judge the [ * ] quality. In any event, Sharp’s shipment of a Product with [ * ] shall constitute its approval. If a Carrier elects not to have [ * ] included in or delivered via OTA update to units it purchases [ * ], then Sharp shall not be required to pay [ * ] royalties on such units. For future products, the parties shall discuss the allocation of royalties for [ * ] features and determine which party is responsible for such royalties in the Product Plan for such future product.

Notwithstanding the foregoing, the parties shall remain liable for certain intellectual property infringement matters (e.g. litigation costs, damages, and license fees, if any) as stated in the Agreement and this Product Plan.

Sharp acknowledges that the [ * ] technology and the [ * ] technology are owned by [ * ] and cannot be used or distributed further without a license from [ * ] or a [ * ]

SHARP CORPORATION		DANGER, INC.
By:	/s/ Masami Ohbatake	By:	/s/ Henry R. Nothhaft
	Masami Ohbatake		Henry R. Nothhaft
	Group General Manager		Chairman & Chief Executive Officer

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EXHIBIT B

DANGER MARKS

Danger®

hiptop®

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EXHIBIT C

SHARP MARKS

Sharp®

Sharp Corporation

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EX-10.21

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EXHIBIT 10.21

MASTER SERVICES AGREEMENT

This Master Services Agreement (the “Agreement”) is made by and between T-MOBILE USA, INC., a Delaware corporation, (“T-Mobile”), and DANGER, INC., a Delaware corporation (“Danger”), and is effective as of June 1, 2005 (the “Effective Date”).

BACKGROUND

Danger and T-Mobile entered into an Operations and Marketing Agreement dated October 16, 2001 and amendments to that agreement (collectively, the “Original Agreement”);

Due to the evolution of the parties’ relationship, the parties agree that the Original Agreement needs to be terminated and a new agreement established to govern the parties relationship going forward;

AGREEMENT

1. DEFINITIONS

1.1 “Active Subscriber” means a Subscriber who is billed by T-Mobile (e.g., has a rate plan that allows for use of the Danger Services) to receive Danger Services through the T-Mobile Network, and who has not been suspended from using the T-Mobile Network by T-Mobile.

1.2 “Approved Premium Content” means Premium Content that have been approved for commercial distribution to Subscribers by both T-Mobile and Danger in accordance with the testing and acceptance procedures described in Exhibit D.

1.3 “Basic Services” means those Danger Services offered to Subscribers as specified in Exhibit A, in addition to (i) all Upgrades and Enhancements to those Danger Services, and (ii) future new services that Danger includes at Danger’s sole discretion, and that T-Mobile accepts, as included in the Service Fee set forth in Section 10.1.

1.4 “Content” means audio and visual data, text, information, graphics and other materials or information.

1.5 “Danger System Data” means metrics, load statistics, Danger bandwidth usage, and any other information or data generated by the Danger System that relates to the performance of the Danger Services, except for all Subscriber Data, which is expressly excluded from Danger System Data.

1.6 “Danger Device” means a wireless handheld device, including without limitation any included hardware, accessories, or embedded firmware, that interacts with the Danger Service and for which Danger has approved the Danger Software and Danger Service functionality.

1.7 “Danger Premium Content” means Premium Content that is either developed by Danger or independently licensed by Danger from a third party, and that Danger offers to T-Mobile for T-Mobile’s distribution to Subscribers. Danger Premium Content will also be considered to be Danger Premium Services.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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1.8 “Danger Premium Services” means those Danger Services that Danger independently creates or obtains at its own cost as a new service and offers to T-Mobile for T-Mobile’s distribution to Subscribers at additional fees beyond the fees for the Basic Services.

1.9 “Danger Services” means the Content and services made available by Danger to T-Mobile, for T-Mobile’s distribution to Subscribers via the T-Mobile Network from time to time during the Term. The term “Danger Services” includes Basic Services and Danger Premium Services.

1.10 “Danger Software” means the software owned or licensed by Danger that resides on a Danger Device and that allows a Subscriber to access the Danger Services, T-Mobile Premium Services, and the T-Mobile Network from a Danger Device. The Danger Software does not include any software embedded in a Danger Device radio module.

1.11 “Danger Support Tool” means the customer care support tool that allows T-Mobile to access Danger’s data center via the Internet to manage Subscriber accounts.

1.12 “Danger System” means the computers and computer servers on which Danger hosts and maintains the Danger Services.

1.13 “Intellectual Property Rights” means all intellectual property rights throughout the world, whether existing under intellectual property, unfair competition or trade secret laws, or under statute or at common law or equity, including but not limited to: (i) copyrights, trade secrets, trademarks, trade names, patents, inventions, designs, logos and trade dress, “moral rights,” mask works, rights of personality, publicity or privacy, and any other intellectual property and proprietary rights; and (ii) any application or right to apply for any of the rights referred to in this clause; and (iii) any and all renewals, extensions and restorations thereof, now or hereafter in force and effect.

1.14 “Manufacturer(s)” means the third-party manufacturer(s) of Danger Devices and its/their authorized distributors. For example, Sharp Corporation and its authorized distributor UTStarcom (formerly AudioVox) are the current Manufacturers of Danger Devices.

1.15 “Major Release” means a new major release of the Danger Software (i.e. a change from software version 2.3 to v3.0).

1.16 “Premium Download Manager” or “PDM” means the client and server application (which is part of the Basic Services and Danger Software) that enables Subscribers to download Content, including Premium Content, to Danger Devices, and which is available to Subscribers through the main chooser menu on the Danger Device.

1.17 “Premium Content” means Content (whether client-only or network-based) that is made available to Subscribers for download via the Premium Download Manager to their Danger Devices, including, without limitation, games, ringtones, utility applications (e.g., calculator, world time clock, currency converter, etc.). Throughout the Term, the parties will maintain a spreadsheet of the Premium Content offered to Subscribers. Premium Content is not included with Basic Services.

1.18 “Prepaid Subscriber” means a Subscriber that T-Mobile has designated as “prepaid” when provisioned for the Danger Service.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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1.19 “Prepaid Account” means a Prepaid Subscriber’s account with T-Mobile in which a credit balance is maintained for use of T-Mobile service and/or Danger Service. Service Fees are deducted from the Prepaid Account balance as charges are incurred by the Subscriber.

1.20 “Prepaid Danger Service” means the Danger Service as provisioned for Prepaid Subscribers.

1.21 “Service Level Agreement” or “SLA” means the agreement setting forth the minimum service levels for provision of the Danger Service and for processing the reporting of outages, bugs, and other events that affect customers as set forth in Exhibit B.

1.22 “Specification” means a specification developed by Danger for a particular Danger Service or Danger Software release. The Specification for Danger Software release 2.3 and the Basic Services for such release is attached hereto as Exhibit A and incorporated by reference herein.

1.23 “Source Code” means software in human-readable language format as prepared and written by the programmer(s) who developed the applicable software, together with any build tools (e.g. compilers, linkers and other related tools), compile/link scripts, program comments, installation scripts and other documentation necessary for an ordinarily skilled programmer to recompile the same into fully functioning object code of the applicable software.

1.24 “Subscriber” means a T-Mobile subscriber who subscribes to, or otherwise is a T-Mobile authorized user of, the Danger Services over the T-Mobile Network using a Danger Device, including without limitation Prepaid Subscribers.

1.25 “Subscriber Data” means Personally Identifiable Information and Aggregate Information. “Aggregate Information” means information communicated or generated in connection with a Subscriber’s use of the T-Mobile Network, a Danger Device, or the Danger Services about habits, usage patterns (except as such patterns are included in Danger System Data), and/or demographics of Subscribers but does not indicate or reveal the identity of any particular Subscriber or identify a group of Subscribers as users of the T-Mobile Network, including without limitation data transmitted to any third party via the T-Mobile Network, the Danger Device, or the Danger Services; such information includes, without limitation, Subscribers’ selection of services or Content, particular information fields, alerts, triggers, and the like with respect to such services or Content, and other transaction-related information. “Personally Identifiable Information” means information communicated or generated in connection with a Subscriber’s use of the T-Mobile Network, a Danger Device, or the Danger Services, including without limitation data transmitted to any third party via the T-Mobile Network, the Danger Device, or the Danger Services about a Subscriber or group of Subscribers that allows such Subscriber(s) to be personally identified or identified as users of the T-Mobile Network; such information includes, without limitation, Subscriber name, Subscriber addresses, PCS numbers, device identification numbers, Mobile Subscriber Integrated Service Digital Network numbers (“MSISDN”), and Subscriber’s personally identifying transaction-related information.

1.26 “T-Mobile Marks” means those service marks, trademarks, tradenames, and slogans specifically designated by T-Mobile in its sole discretion for Danger’s use in connection with the activities contemplated in this Agreement.

1.27 “T-Mobile Network” means the wireless network owned or operated by T-Mobile.

1.28 “T-Mobile Premium Content” means Premium Content that is either developed by T-Mobile or licensed by T-Mobile from a third party. T-Mobile Premium Content is not included as Danger Services.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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1.29 “T-Mobile-Related Company(ies)” are those companies that (a) T-Mobile has an ownership interest in, (b) T-Mobile operates such company’s wireless network, (c) have an ownership interest in T-Mobile of greater than fifteen percent (15%) (“Parent Company”), (d) a Parent Company has an ownership interest in of greater than fifteen percent (15%) (“Sister Company”), or (e) a Sister Company has an ownership interest in of greater than fifteen percent (15%) (“Cousin Company”).

1.30 “T-Mobile Trial Program” means the trial service operated by Danger and configured exclusively for T-Mobile’s use and that is available to those people authorized by T-Mobile.

1.31 “Upgrades or Enhancements” means new versions, improvements, upgrades, updates, and bug fixes of any Danger Software. Upgrades or Enhancements may be indicated as Major Releases, “minor releases” (i.e. a change from v2.1 to v2.2) or “maintenance releases” (i.e. a change from v2.1.1 to v2.1.2) of the Danger Software.

2. ORIGINAL AGREEMENT. The parties agree that the Original Agreement shall be terminated as of the Effective Date but shall survive to govern the parties’ obligations as they arose prior to the Effective Date; provided however, the parties’ obligations regarding the Danger Software and the Danger Services for Sidekick II Danger Devices shall be governed by the terms and conditions of this Agreement.

3. SOFTWARE AND SERVICES DEVELOPMENT AND TESTING

3.1 Basic Services. At Danger’s sole cost and expense, Danger will develop and provide the Basic Services, which will include those functions set forth in Exhibit A, and those Basic Services added pursuant to this Agreement. Any deletion or addition to the Basic Services shall require the mutual written consent of the parties. Danger will, in accordance with Section 7.6, support and maintain the Basic Services for all Danger Devices; provided however, that Basic Services may not be “backwards compatible” with Danger Devices launched before such Basic Services were available. The parties shall use the Roadmap process, described in Section 3.4 below, to mutually agree on which Basic Services will be supported for different Danger Device models. Danger will continue to support the Basic Services for all future Danger Devices, as provided for herein.

3.2 Upgrades and Enhancements. At Danger’s sole cost and expense, Danger will make reasonable commercial efforts to continue to develop and enhance the Danger Software and the Danger Services. Danger will make available to T-Mobile a minimum of one (1) Minor Release of the Danger Software each year in accordance with the development and launch schedule presented in the Roadmap (defined below). Danger will also make available to T-Mobile in 2006 at least one (1) Major Release of the Danger Software. Danger will from time to time solicit product suggestions from T-Mobile as part of this process. Danger will use commercially reasonable efforts to provide bug fixes for the most recent versions of the Danger Software and the Danger Service as quickly as practicable. Response times for errors with the Danger Service are governed by the SLA and therefore, for any conflict between this Section and the SLA, the terms of the SLA will prevail. Upgrades or Enhancements to the Danger Software, including updates and upgrades to the Danger operating system, will be made available to T-Mobile at the earliest commercial availability at no additional cost to T-Mobile. All Upgrades and Enhancements to Danger Software must be tested and accepted in accordance with the procedures set forth in Sections 3.5. Notwithstanding the foregoing, the parties may mutually agree in writing to implement Upgrades and Enhancements without utilizing such acceptance procedures on a case-by-case basis.

3.3 Branding of Services. The Danger Software will be T-Mobile-branded and will contain no marks (other than T-Mobile Marks) except as mutually agreed, and in any event won’t contain any marks

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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competitive to T-Mobile or its affiliates. The software on Danger Devices purchased by T-Mobile will be “white-labeled” and will not contain any Danger Marks or other marks without T-Mobile approval. Notwithstanding the foregoing, the boot up screen for the Danger Software on the “Sidekick III” and “Sidekick Style” Danger Devices will contain Danger “ingredient” branding (e.g. “Powered by Danger”) as designated by T-Mobile. The parties shall discuss Danger ingredient branding for boot up screens for the Danger Software on other Danger Devices, but have not yet agreed on this matter. Danger may include an “about” page, or similar page, which will contain only the trademarks, service marks, and copyright notices about Danger and its licensors. Such page will be subject to T-Mobile’s prior written approval.

3.4 Roadmap.

(a) On a rolling [ * ] basis, delivered every quarter during the Term, Danger will provide for T-Mobile’s approval, a roadmap for new features, upgrades, and evolution of the Danger Service and Danger Devices (the “Roadmap”). The Roadmap will be presented in two parts: (1) “Hardware Platform,” which shall outline Danger Devices models and the Device Software and Danger Service development for such models and (2) “Services and Features,” which shall outline the development of Danger Service and Device Software features that are independent of hardware platform development. The Roadmap will detail features and upgrades that Danger is committed to deliver to T-Mobile. The Roadmap will also detail features and upgrades that Danger is planning to provide, but for which schedules and specifications are not yet finalized. The Roadmap will also detail features that Danger is investigating, but which are only at a concept stage. If Danger requests NRE for development of a feature, then T-Mobile shall be entitled to a [ * ] for such feature. Any such feature and associated [ * ] shall be discussed by the parties in the Roadmap process and must be mutually agreed upon in writing by the parties. In addition, if there are known third party royalties associated with particular features, the parties shall disclose such costs, discuss, and mutually agree which party shall bear such royalties prior to agreeing to add such features to the Roadmap. Such roadmap will [ * ] vis-à-vis other wireless network operators. The Roadmap as of the Effective Date is attached hereto as Exhibit E.

(b) Upon agreement by T-Mobile of the Roadmap, and unless otherwise agreed upon by the parties in writing, new features on the agreed upon Roadmaps will be made available to T-Mobile as part of the Monthly Service Fee (as defined below), and Danger will not charge any additional fees unless expressly agreed upon in writing by T-Mobile.

(c) For Roadmap items that T-Mobile wishes to expedite, or for features T-Mobile would like developed that are not on the Roadmap, the parties may mutually agree to have Danger perform special development projects. Amounts charged to T-Mobile for such additional development shall be at [ * ].

(d) Once per quarter, appropriate executives from Danger and T-Mobile shall discuss the Roadmap, agree upon the commitments in the Roadmap and review the parties’ progress in developing and deploying new features for the Danger Service and the Danger Software (the “Quarterly Roadmap Meeting’). The parties currently plan that such discussions shall include Danger’s Chief Executive Officer, Henry R. Nothhaft, and T-Mobile’s Sr. Vice President and Chief Development Officer, Cole Brodman, as well as appropriate representatives from Danger’s product management group, T-Mobile’s product realization group and the parties’ respective engineering organizations. The timing for such discussions shall be mutually agreed upon by the parties.

(e) Once per quarter, at least thirty (30) days prior to the Quarterly Roadmap Meeting, T-Mobile will provide Danger with a ranked list of a reasonable number of Software and

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Features Roadmap items that are T-Mobile’s highest priorities (each a “T-Mobile Priority Item”). At the Quarterly Roadmap Meeting, the parties shall mutually agree to a realistic “Target Date” for delivery of a release candidate of such T-Mobile Priority Item to T-Mobile for testing. Upon such agreement, the T-Mobile Priority Item shall be deemed “committed” on the Roadmap. At the time the Target Date is set for each T-Mobile Priority Item, the parties shall also mutually agree to an “Early Date” and associated “Early Bonus,” and a “Late Date” and associated “Late Fee.” The Early Bonus and the Late Fee will be the same amount. If Danger delivers the release candidate for a T-Mobile Priority Item on or before the applicable Early Date, and that release candidate is Accepted by T-Mobile after testing without making substantive exceptions to the specification for the Services or the T-Mobile testing process, then T-Mobile shall pay Danger the Early Bonus within thirty (30) days of the Acceptance of the T-Mobile Priority Item. If Danger delivers the release candidate for a T-Mobile Priority Item after the Late Date, Danger shall pay T-Mobile the Late Fee within thirty (30) days of the Late Date. All schedules and mutually agreed upon Roadmap dates will be equitably adjusted for material delays caused by T-Mobile. In addition, at the time a T-Mobile Priority Item is committed on the Roadmap, the parties shall mutually agree on schedule-impacting, development dependencies for which third parties are responsible (each a “3^rd Party Dependency”). If, through no fault of Danger, material delays result from 3^rd Party Dependencies, the parties shall adjust the Roadmap schedules appropriately. Delays that may result from third parties that are not listed as a 3^rd Party Dependency are the responsibility of Danger and will not result in adjustments to the Roadmap schedules.

(f) Custom Development of Roadmap Items. During the period from [ * ] to [ * ] T-Mobile agrees to spend up to [ * ] dollars ($[ * ]) (the “Development Fund”) for the purpose of supplementing the non-recurring engineering (“NRE”) funding for development of T-Mobile-specific features or applications, or for the acceleration of Roadmap items. Danger will increase its development resources in order to complete projects funded by the Development Fund. At the Quarterly Roadmap Meetings, the parties shall discuss which Roadmap items will be funded with Development Funds, the amount of NRE payments and the scope and schedule for each such item. In T-Mobile’s discretion, T-Mobile will identify which projects, and the schedule priority for such projects, that will be funded by the Development Fund. The parties shall mutually agree in writing to statements of work (SOW) that detail the specifications and schedule for each Roadmap item covered by this Section 3.4(f). All development work to be funded by the Development Fund will be at costs verifiable by T-Mobile. If Danger fails to deliver an acceptable release candidate of the Roadmap item by the scheduled date for that item, then T-Mobile will be responsible for [ * ] for that project, and if Danger fails to deliver an acceptable release candidate within sixty (60) days of the scheduled delivery date for that item (or such other mutually agreed upon time period), then T-Mobile will not be responsible for [ * ] for that project. Schedules in any SOW shall be equitably extended for delays attributable to T-Mobile. In each SOW, the parties shall also agree to [ * ] for the Roadmap item paid for with Development Funds.

3.5 Danger Premium Services. Danger will identify in the Roadmap Danger Services for which it desire to charge additional service fees. Upon mutual agreement by each party, any new Danger Services for which T-Mobile agrees to pay an additional service fee will be a Danger Premium Service.

3.6 Testing Procedures and Acceptance Process for Danger Software. This Section 3.6 applies to the testing and acceptance of all Danger Software, and all Upgrades or Enhancements to the Danger Software, except for Danger Premium Content, which is subject to the testing and approval process set forth in Exhibit D.

(a) At Danger’s cost and expense and prior to delivery to T-Mobile for testing, Danger (or the Manufacturer) will test each new Danger Software Upgrade or Enhancement to ensure that

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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the Danger Software complies with the requirements of this Section 3.6. The Danger Software must comply with (i) all material elements of the applicable Specification, (ii) Danger’s written guarantees, representations, and warranties for the Danger Software and Danger Service, and (C) applicable regulatory rules and other federal, state, and local legal requirements. The Danger Software shall be PTCRB approved against 3GPP Specifications. Upon request, Danger will answer T-Mobile’s reasonable questions about results of testing and testing methodology used in Danger’s testing of the Danger Software. Danger will provide T-Mobile with copies of all release notes pertaining to Upgrades and Enhancements of Danger Software. All such testing results, release notes and Danger Software provided to T-Mobile for testing or the T-Mobile Trial Program shall be treated as Confidential Information.

(b) The parties acknowledge that Manufacturers shall be responsible for ensuring that Danger Devices comply with (i) all required federal, state and local laws, rules, regulations, and codes in existence during the Term (including without limitation, FCC rules, regulations and requirements), as required by T-Mobile, and (ii) all required Internet standards, EIA/TIA, GSM, GSM NA, and ETSI standards and all other relevant industry specifications and standards, that are required because of the features provided for in the Service Specification.

(c) T-Mobile will use commercially reasonable efforts to promptly test each Danger Software Upgrade or Enhancement for compliance with the applicable Services Specifications, security, PTCRB requirements, market needs, and compatibility with the T-Mobile Network. Danger shall provide T-Mobile with reasonable assistance, including as appropriate, access to Danger’s facilities, to help T-Mobile conduct testing.

(d) Prior to introducing any Danger Software Upgrades or Enhancements, Danger will work with T-Mobile to develop a “target acceptance plan”, according to the prevailing test methodology used by T-Mobile at the time of the release. This will include the release of multiple Alpha (as applicable) and Beta versions of the software for early review by T-Mobile, and subsequently a “Release Candidate” release, which will pass through several iterations of testing, according to the T-Mobile methodology. T-Mobile testing process and minimal entrance criteria are documented in T-Mobile US PRD 30-38 “Test Requirements for Terminal Suppliers.”

(e) Feedback Regarding Prototypes of Danger Software. T-Mobile shall use commercially reasonable efforts to provide Danger with written comments as promptly as practicable regarding T-Mobile’s testing of the Danger Software as set forth in Section (c) above.

(f) Final Approval and Acceptance of Danger Software. After Danger’s delivery of a Release Candidate of the Danger Software, T-Mobile will use commercially reasonable efforts to promptly provide in writing either (i) an acceptance letter stating that T-Mobile has accepted the Danger Software for delivery to its Subscribers (“Acceptance”, “Accept” or “Accepted”), or (ii) a rejection letter that describes in reasonable detail why T-Mobile has not Accepted the Software. If T-Mobile has not issued an Acceptance letter for the Danger Software within sixty (60) days after Danger’s delivery of a Release Candidate of the Danger Software, or thirty (30) days after any fixes or upgrades have been applied to such final Release Candidate of the Danger Software, whichever date is later, and so long as any delay in Acceptance is not due to outstanding Danger Software issues of which T-Mobile has notified Danger in writing, then T-Mobile’s exclusivity set forth in Section 9.3 may be forfeited for that Danger Software at Danger’s discretion. If T-Mobile does not Accept a Danger Software Upgrade or Enhancement, the parties will use commercially reasonable efforts to resolve outstanding issues, unless T-Mobile does not wish to provide such Danger Software Upgrade or Enhancement.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(g) Testing for Premium Content. Prior to making Premium Content available to a Subscriber, such Content must be tested and accepted in accordance with the process set forth in Exhibit D.

3.7 Testing of Danger Services. Prior to introducing any new customer facing features for the Danger Service, Danger will notify T-Mobile and the parties shall discuss the need for testing such that T-Mobile may test such new features. Prior to launching any new customer facing features, T-Mobile must accept such features. The parties will mutually agree on a schedule for such review and launch. Danger will provide T-Mobile a minimum of ten (10) business days’ prior notice of the implementation on the T-Mobile Trial Program of any update or revision to the Danger Service that contains the new feature and shall provide T-Mobile with release notes or other descriptions of such Danger Service update prior to implementation on the T-Mobile Trial Program. After Danger has placed such Danger Service on the T-Mobile Trial Program for T-Mobile’s testing for at least ten (10) days, Danger can [ * ] prior to receiving T-Mobile’s approval, unless the new Danger Service [ * ].

3.8 T-Mobile Assistance.

(a) Personnel Resources. T-Mobile shall assign a project manager to work with Danger throughout the testing and deployment process and on an ongoing basis.

(b) Data Network Access. T-Mobile will provide Danger access to T-Mobile’s appropriate data network test facilities as mutually agreed upon by the parties.

(c) On-Site Access. T-Mobile will provide Danger reasonable access to T-Mobile’s facilities and technical support at a Seattle/Bellevue, Washington location solely for Danger’s implementation of the Danger Services pursuant to this Agreement. Any access to T-Mobile’s premises, equipment, or technology is subject to T-Mobile’s sole discretion and may be conditioned upon security, confidentiality, and timing requirements established by T-Mobile.

(d) Test Plans, Results. Promptly following testing, T-Mobile shall provide Danger reasonable feedback regarding all test results for beta and commercial quality test cycles and reasonably detailed descriptions of bugs encountered and unexpected results.

4. OPERATION OF DANGER SERVICES

4.1 Operation of Danger Services.

(a) General. Except as otherwise provided in this Agreement, Danger, at its sole cost, will host and operate (itself, or by use of third parties) the Danger Service. Notwithstanding the foregoing, all T-Mobile Premium Content must be hosted by Danger unless expressly authorized by T-Mobile in writing. Except in the event of T-Mobile providing the Danger Services pursuant to Section 11.2 or Section 13, T-Mobile shall not assist or authorize any third party to operate the Danger Services, or any proprietary operating systems for use with Danger Devices; so long as Danger continues to provide the Danger Services to T-Mobile. Throughout the term of this Agreement, the Danger Service will be connected to the T-Mobile GGSN(s) via dedicated lines to two redundant points in the T-Mobile network. Danger will install, operate and maintain such dedicated lines at Danger’s sole cost; provided T-Mobile shall cooperate and make reasonable efforts to provide interconnection points at locations which offer the lowest possible cost to Danger. If T-Mobile initiates a move of point-of-presence (POP) that results in Danger incurring re-termination or other out-of-pocket costs, T-Mobile will reimburse Danger for such

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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costs. T-Mobile shall reasonably consider Danger’s suggestions for other interconnect methods that will reduce Danger’s costs.

(b) Service Level Requirements. Danger will ensure that, at all times, the quality of the Danger Service meets or exceeds the requirements and standards and trouble ticket process set forth in the Service Level Agreement set forth in Exhibit B.

(c) T-Mobile Provision of Danger Service. Throughout the Term, if, for any reason there is any substantial threat that the Danger Service will be interrupted or shut down, or the Danger Service is interrupted or shut down (except in the event of a force majeure event under Section 23.6), T-Mobile has the right, but not the obligation, to take any and all necessary steps to keep the Danger Service turned on and functional during such period of interruptions or shut down, including the right to access and use the Source Code (on the Danger premises or within the supervision of Danger personnel), for such limited period of time and strictly for the foregoing purposes, and Danger has an affirmative obligation to allow T-Mobile to take all necessary actions and shall cooperate fully in all respects with T-Mobile in its efforts to run and maintain the Danger Service at acceptable performance levels for such limited period of time. The parties agree that damages are an inadequate remedy to a breach of this Section and that T-Mobile may seek specific performance of this Section in the event of a breach by Danger of this Section 4.1(c) where such specific performance shall be enforced solely during the period of time until the Danger Service is no longer interrupted, shut down, or in imminent danger of being interrupted or shut down.

(d) Data Network. T-Mobile will make commercially reasonable efforts to provide access to wireless data networks in states not in T-Mobile’s footprint where possible through roaming agreements with other wireless carriers.

(e) Manager in Residence. T-Mobile has the right, but not the obligation, to have a “manager in residence” located at Danger to observe Danger’s operations and be a contact point for T-Mobile. T-Mobile will be responsible for all costs associated with this employee’s presence. Any access to Danger’s equipment, or technology is subject to Danger’s reasonable discretion and may be conditioned upon security, confidentiality, and timing requirements established by Danger.

4.2 Customer Support

(a) First Tier Support. T-Mobile, at its sole cost, will be responsible for providing, or arranging for the provision of, initial support services directly to Subscribers (including customer care for the T-Mobile Network; assistance with troubleshooting, set-up, and use of the Danger Services and Danger Software; and billing and account support) with respect to use of the Danger Services and Danger Software. Danger will not be obligated to provide initial support services (such as trouble shooting and assistance with set-up and use) directly to Subscribers with respect to the Danger Services or the Danger Device. Danger shall have no obligation to coordinate warranty processing, repair, and refurbishment services for Subscribers’ Danger Devices.

(b) Second Tier Support. If T-Mobile personnel experience any problems with the Danger Services or the Danger Devices or if T-Mobile receives questions or complaints from Subscribers regarding the Danger Services or Danger Devices (including issues relating to troubleshooting, set up, and use of the Danger Services and Danger Devices), Danger, at its sole cost, will provide support to T-Mobile to resolve any problems raised by T-Mobile, including, without limitation, by following the procedures set forth in the Customer Support SLA attached hereto as Exhibit C. T-Mobile’s customer support representatives that are trained for Danger Device support shall interact with and escalate issues

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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to Danger’s customer support team. Except as set forth in Section 4.2(a) above, or pursuant to the Customer Support SLA, Danger will not be obligated to provide support directly to Subscribers with respect to the Danger Services or the Danger Device; however, Danger may, at its option, upon the request of T-Mobile, have a Danger support person interact directly with a Subscriber when the Danger support manager deems it is the most effective manner to resolve a problem relating to the Danger Services or the Danger Device.

(c) Escalation.

(i) Danger will communicate incident resolution progress to T-Mobile and escalate its problem resolution efforts within the time limits specified in the SLA. In addition to the contacts set forth in the SLA, Danger will provide T-Mobile with a primary contact for all technical and service related issues that arise in connection with the Danger Services or Devices; provided, however, that T-Mobile may contact any other appropriate Danger personnel if T-Mobile so chooses.

(ii) Upon T-Mobile’s request, Danger shall make available within ten (10) business days, at T-Mobile’s offices, during normal business hours, the Danger program manager and other appropriate personnel to discuss the status of the Danger Services, the Danger Software and Danger’s compliance with this Agreement.

(d) Support Information. The parties shall work together to exchange information about customer support issues on a regular basis, at least once per calendar month. Danger shall provide T-Mobile with the Danger Support Tool to allow the T-Mobile’s customer support to access subscriber information stored in the Danger data center and file trouble tickets with Danger. T-Mobile will authorize the disclosure of RMA and Danger Device return information by Manufacturers to Danger.

(e) Customer Service Training. As mutually agreed upon by the parties, Danger will provide periodic “train-the-trainer” sessions for T-Mobile training personnel to enable such personnel to train T-Mobile’s customer care staff to provide first tier support for the Danger Services and Danger Devices. With T-Mobile’s prior permission, Danger customer care representatives may visit T-Mobile’s customer call center to offer guidance, training and observe T-Mobile’s customer care for the Danger Service and Danger Devices.

4.3 Danger Service Reporting.

(a) Danger Reporting to T-Mobile. Danger shall provide to T-Mobile written notice immediately upon the occurrence of the following events: (i) any manufacturing defect in the Danger Devices of which Danger is aware, (ii) any high severity bug or defect in the Danger Services or Danger Software of which Danger is aware, (iii) any legal action or threatened legal action involving the Danger Software, Danger Service, or Danger Device (of which Danger is aware) (iv) any breach or default of any material term in this Agreement, (v) Danger’s breach, or threatened breach of a material third party agreement related to the Danger Software or Danger Services, (vi) Danger’s inability to pay any invoices or money owed when such money is due, or (vii) any security breach or material loss of Subscriber Information.

(b) Service Reporting. Throughout the Term, on a monthly basis, Danger shall provide to T-Mobile within ten (10) business days of the end of the month, aggregate Subscriber usage information, and active days per Subscriber, in a form and substance to be mutually agreed upon by the parties, but in no event may Danger refuse to provide information that is readily available in Danger’s usual course of business. In addition, as part of the standard Roadmap process, Danger will work with T-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Mobile to prioritize and schedule the development of enhanced reporting capabilities that are requested by T-Mobile.

(c) T-Mobile Reporting to Danger. Throughout the Term, T-Mobile will provide to Danger monthly reports of new Subscriber activations, deactivations, cumulative Active Subscribers, and other data as reasonably requested by Danger and agreed upon by T-Mobile. All such data will be T-Mobile’s Confidential Information and Danger will treat such data as confidential pursuant to its confidentiality obligations in this Agreement, provided that Danger may use such data for purposes of financial reporting. T-Mobile shall provide to Danger written notice of (i) on a periodic basis, reports on the trends reported in bugs and defects of the Danger Devices or Danger Services, (ii) any legal action or threatened legal action involving the Danger Device or Danger Service, provided that such notice does not adversely affect T-Mobile in regard to any rights to indemnification, and (iii) T-Mobile’s breach, or threatened breach of any third party agreement to provide synchronization or instant messaging services if such breach or threatened breach will adversely affect Danger’s provision of Danger Software or Danger Services.

5. Premium Content and Instant Messaging.

5.1 Premium Content. The Premium Download Manager is the primary means by which to deliver Premium Content to Subscribers. Danger will host and maintain the Premium Download Manager as part of the Basic Services. The terms by which the parties shall offer Premium Content are set forth in Exhibit D.

5.2 Instant Messaging. T-Mobile may offer third-party instant messaging functionality via the Danger Service (e.g. AIM, Yahoo! Messenger) (each an “IM Service”). Danger shall be responsible for developing and maintaining the Danger Software and the Danger Service to support IM Services that the parties mutually agree to launch and support. As of the Effective Date, the parties have agreed to support AIM and Yahoo! Messenger. Additional IM Services may be offered via the Danger Service by mutual written agreement of the parties. T-Mobile shall be responsible for paying any license or other fees to the third-party IM Service providers related to the use of an IM Service so T-Mobile may provide the IM Services to Subscribers via Danger Services. Such fees shall be paid directly to the third-party IM Service providers at the rates negotiated by T-Mobile. For any IM Service that the parties mutually agree to offer via the Danger Service, Danger shall be responsible for paying any technology license fees, if any, to a third party IM Service provider. The continued offering of IM Services is conditioned upon each party having sufficient rights to offer each particular IM Service via the Danger Service and the Danger Device to Subscribers.

6. Prepaid Danger Service. The parties previously launched the Danger Service enabled for Prepaid Subscribers pursuant to the Service Specifications set forth in “Prepaid Services PRD” dated October 1, 2004 (the “PRD”). Any changes to the PRD shall require the mutual written agreement of the parties.

6.1 Ongoing Operations. Each party shall continue to maintain its technical systems in good working order to ensure the proper functioning and billing for the Danger Service for Prepaid Subscribers. In addition, each party shall use reasonable commercial efforts to provide a pre-production test environment so that they may test the impact of modifications and new releases of the Danger Service on Prepaid Subscribers. T-Mobile has provided Danger (at no charge) with 50 SIM cards provisioned for the Prepaid Danger Services solely for the testing and development of the Prepaid Danger Service for T-Mobile. Danger may only provide the SIM cards to Danger employees tasked with developing or testing the Prepaid Danger Service. Upon request, Danger will provide to T-Mobile the names of any Danger

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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employees that are using such SIM cards, and T-Mobile may require that such employees sign an agreement stating that such employee will only use the SIM card for the purpose of testing and development of the Prepaid Danger Service. If an employee leaves Danger, or if the employee is no longer involved with the development or testing of Prepaid Danger Services, then Danger will ensure that the employee no longer uses the SIM card and will notify T-Mobile if that SIM card has been provided to a different Danger employee. T-Mobile may request that SIM cards be returned to T-Mobile at any time with thirty (30) days written notice to Danger; provided however, in the event of such request, Danger shall not be responsible for any development or testing delays caused as a result and Danger may require T-Mobile to reimburse Danger for a mutually agreed upon number of replacement SIM cards needed for development and testing purposes. Danger will provide T-Mobile the following documentation for customer care support for the Prepaid Service: Danger Support Tool documentation and screen shots, frequently asked questions and training documentation.

6.2 Future Software and Prepaid Danger Services. Danger shall maintain the Danger Software so that Manufacturers may offer future Danger Device models that support Prepaid Subscribers. Danger will include support for Prepaid Subscribers in all new Danger Services, including all Upgrades and Enhancements. Danger will include in Prepaid Danger Services all Basic Services. However, if Danger requests NRE for development of the feature for the Prepaid Service, then the parties shall discuss Prepaid Danger Service support (and any NRE) for such feature in the Roadmap process, as set forth in Section 4.s

6.3 Service Level Agreement. The Prepaid Danger Service will comply with the Service Level Agreement and requirements set forth in Section 4.1(b) of the Agreement. Danger will use commercially reasonable efforts to have all provisioning requests sent by T-Mobile to Danger via the XML data exchanges responded to by Danger within one (1) second.

6.4 Premium Content for Prepaid Subscribers. Prior to Danger fulfilling a Prepaid Subscriber’s request to purchase Premium Content, Danger shall query the Prepaid Account via the interface mutually agreed upon by the parties to debit the Prepaid Account for the purchase amount of the Premium Content. If T-Mobile’s billing system confirms that the purchase amount was debited (i.e. sufficient funds existed in the Prepaid Account), Danger will fulfill the download request via the Premium Download Manager and will bill T-Mobile for a successful download. Danger will only bill T-Mobile for Successful Downloads of Premium Content in which Danger debits the Prepaid Account of the Prepaid Subscriber. A “Successful Download” is the occurrence of the successful delivery of a piece of Content to a Subscriber’s Danger Device. Danger will not bill T-Mobile (or will credit T-Mobile) for any unsuccessful downloads to Prepaid Subscribers. If T-Mobile’s billing system replies that insufficient funds exist in the Prepaid Account, Danger will not fulfill the download request and T-Mobile will not be billed. Danger will invoice T-Mobile for purchases of Premium Content by Prepaid Subscribers in the same manner as currently set forth in the Agreement. Prepaid Subscriber purchases of Premium Content during the first 24 hours of such Subscriber’s activation will be billed to T-Mobile irrespective of the fact that no Prepaid Danger Service Fee is due during the first 24-hour period following activation. Danger shall provide Premium Content reporting broken out between post-paid and Prepaid Subscribers in its invoices to T-Mobile.

6.5 Prepaid Subscriber Support. Support for Danger Services to Prepaid Subscribers shall be the same as that provided for all Subscribers per the terms of Section 4.2.

6.6 Prepaid Subscriber Billing and Reporting. A Prepaid Subscriber will be considered an Active Subscriber when he/she has sufficient credit in his/her account such that T-Mobile successfully debits that Prepaid Subscriber’s account for T-Mobile’s 24-hour data service fee. A successful debit to the Prepaid

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Subscriber is determined by a confirmation from the T-Mobile Converged Charging Node (CCN) to Danger that the Prepaid Subscriber’s account has sufficient funds and has been charged for a 24-hour data service fee. Notwithstanding the above, for the first 24 hours in which a Prepaid Subscriber activates his/her Prepaid Danger Device, the Prepaid Subscriber will not be considered an Active Subscriber.

6.7 Prepaid Subscriber Reporting. Within ten (10) business days of the end of each month, T-Mobile will provide to Danger a report of that month’s total for Service Fees for Prepaid Subscribers. Such report shall include, at a minimum, the aggregate amount of Service Fees due and the following items by Subscriber: IMSI, MSISDN, and number of billable days (the “Prepaid Billing Report”). T-Mobile will pay Danger for such fees in accordance with Section 10. Danger shall only reimburse or credit T-Mobile for credits issued by T-Mobile for Service Fees for Prepaid Subscribers where such credits were issued as a result of overcharges or other errors caused by Danger that occur within the Prepaid Danger Service. Invoices for Service Fees regarding Active Prepaid Subscribers will be based upon the reports created by T-Mobile.

6.8 Prepaid Subscriber Deactivation. If a Prepaid Subscriber has not added funds to his/her Prepaid Account for a period of ninety (90) days after he/she has been denied access to the Danger Service for insufficient funds, T-Mobile shall send Danger a deactivation request. Danger shall continue to store such Prepaid Subscriber’s data for a period of sixty (60) days following T-Mobile’s deactivation request, after which Danger may deactivate the Prepaid Subscriber’s Danger Service account and delete all data for such account. Each month Danger will provide T-Mobile a list of Prepaid Subscriber accounts which have been at insufficient funds and/or suspended for at least 150 days. T-Mobile will use commercially reasonable efforts to review the list and respond to provide a list of the Prepaid Subscribers who may be deactivated.

7. DANGER DEVICES

7.1 Licenses. Danger will enter into license agreements with Manufacturers, whereby Danger will license to the Manufacturer rights necessary to manufacture and distribute the Danger Software on Danger Devices and provide reasonable technical assistance to Manufacturers.

7.2 Development and Testing. Danger will use reasonable efforts to support Manufacturers’ development of Danger Devices in accordance with specifications agreed upon in writing among Danger, Manufacturer and T-Mobile. Unless otherwise agreed to by the parties, Danger shall not be obligated to provide Danger Devices to T-Mobile for testing; rather T-Mobile shall obtain test devices from Manufacturers. T-Mobile shall use commercially reasonable efforts to require the Manufacturer to obtain any necessary agency, regulatory, and industry-required approvals for Danger Devices, including FCC, PTCRB, and other governmental or industry-required approvals. Pursuant to its agreements with Manufacturers, Danger agrees to provide assistance reasonably requested by Manufacturers for the Manufacturer to obtain such approvals.

7.3 Purchase Terms. If T-Mobile desires to purchase Danger Devices, T-Mobile shall purchase Danger Devices directly from Manufacturers. All Danger Device purchase terms, including without limitation, pricing, lead times, order fulfillment, and warranty servicing and post sales support shall be determined between T-Mobile and the Manufacturer.

7.4 Branding. The hardware for each Danger Device will be branded as agreed upon between T-Mobile and Manufacturer.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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7.5 Forecasts. At the beginning of every month, T-Mobile will provide Danger with a non-binding, rolling forecast of its projections for the acquisition of Subscribers during the next six (6) months. Such forecasts do not create a commitment for T-Mobile to purchase the Danger Devices or to acquire Subscribers in any manner in the time period specified in such forecast.

7.6 Device Software and Service Support and Maintenance. Danger shall provide maintenance Upgrades or Enhancements for Danger Devices for [ * ] (the “Support Period”). Danger shall also support and maintain the Danger Services for each particular Danger Device model for the duration of the Support Period. Danger shall make new features and functions available for Danger Devices via Upgrades and Enhancements only for a period of [ * ].

8. SALES AND MARKETING

T-Mobile will use reasonable efforts to distribute and market Danger Devices and Danger Services within T-Mobile’s wireless service footprint in the continental United States. T-Mobile at all times may decide, in its sole discretion, how the Danger Devices and Danger Services are to be marketed, sold, offered, and distributed under this Agreement. T-Mobile makes no representations or guarantees regarding maximum sales, projected revenues, or expected profits in relation to the Danger Device or Danger Services.

9. [ * ].

9.1 [ * ] Subject to the terms and conditions of this Agreement, Danger hereby grants to T-Mobile the [ * ] (as defined below) to [ * ] Danger Device (anticipated to be [ * ] and [ * ] expected to [ * ] in the United States. Danger may not support or authorize any other [ * ] [ * ] with a [ * ] that is [ * ], including without limitation Danger Devices that [ * ]. [ * ] T-Mobile acknowledges that Danger does not control all rights in such Danger Devices, and therefore, such exclusivity shall be limited to areas within Danger’s control. T-Mobile may work with the applicable Manufacturers to obtain additional [ * ] with respect to such Danger Devices. For [ * ], T-Mobile’s [ * ] rights hereunder shall be subject to the following conditions: (a) T-Mobile [ * ] within [ * ], such [ * ] by T-Mobile (the [ * ] period shall be [ * ] T-Mobile); and (b) T-Mobile [ * ] of at least [ * ].

9.2 [ * ] [ * ]. Subject to the terms and conditions of this Agreement, Danger hereby grants to T-Mobile an [ * ] to [ * ] any [ * ] for a [ * ] (each a “[ * ]”) before such [ * ] with any [ * ]. The [ * ] shall be triggered upon Danger’s delivery to T-Mobile of a written, actionable proposal that includes [ * ] and [ * ] for a new [ * ] with a preliminary [ * ]. T-Mobile shall have a [ * ] period from the [ * ] and to provide written notice to Danger whether it wishes to exercise its [ * ] hereunder. If T-Mobile exercises [ * ], the parties shall work together to either (a) obtain the [ * ], or (b) to mutually agree upon terms by which T-Mobile [ * ]. Danger will not unreasonably withhold or delay its agreement on terms to [ * ]. Danger will not [ * ] during T-Mobile’s [ * ] consideration of the [ * ], nor during T-Mobile’s [ * ] negotiation period if T-Mobile’s exercises its [ * ]. If the parties are successful in achieving (a) or (b) above within [ * ] after Danger delivery of the proposal to T-Mobile, T-Mobile shall be the [ * ] [ * ] [ * ] for a minimum period of [ * ] after [ * ]. If the parties are unable to achieve (a) or (b) above within [ * ] period after Danger delivery of the proposal to T-Mobile, Danger shall have the right to [ * ] (either directly or indirectly) the [ * ] to [ * ]. Nothing in this Section 9.2 shall confer any rights to a [ * ]. Rights to such [ * ], including [ * ] shall be negotiated between [ * ].

9.3 [ * ]. Subject to the terms and conditions of this Agreement, Danger hereby grants to T-Mobile an [ * ] to [ * ] that provide [ * ] via the Danger Service [ * ] such [ * ] with [ * ] that, in the [ * ] from Danger. If T-Mobile exercises its [ * ], such [ * ] shall be provided to T-Mobile at mutually agreed rates, which shall be [ * ] Danger offers for such [ * ]. The [ * ] shall be triggered upon Danger’s delivery to T-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Mobile of a written actionable proposal for [ * ] that is identified as triggering T-Mobile’s [ * ]. At a minimum, such proposal must include (i) a [ * ] for the [ * ], (ii) a [ * ], and (iii) the proposed additional fees, if any, [ * ]. Danger will not [ * ] with any [ * ] the [ * ] during T-Mobile’s [ * ]. For purposes of clarification[ * ] disclosed to T-Mobile in the [ * ] will not trigger T-Mobile’s [ * ]. From the delivery of such proposal, the parties shall negotiate in good faith for [ * ] to reach a binding agreement for the [ * ]. Danger will not unreasonably withhold or delay its agreement on terms [ * ] with T-Mobile. If the parties are successful in achieving an agreement to launch the [ * ] within such [ * ] period, T-Mobile shall be the [ * ] to [ * ] in the [ * ] for a period of [ * ] after commercial launch. If the parties are unable to reach a binding agreement to [ * ] within such [ * ] period, Danger shall have the right to [ * ] the [ * ] [ * ]. Danger will commit sufficient development and operational resources to support [ * ].

9.4 [ * ]. Subject to the terms and conditions of this Agreement, Danger hereby grants to T-Mobile the [ * ] to [ * ] as set forth in Exhibit F (the “[ * ]”) in the [ * ] for a period of [ * ] months from the [ * ]. If T-Mobile’s [ * ] to [ * ] terminate pursuant to Section 9.1, then the rights under this Section 9.4 shall terminate at the same time.

9.5 [ * ]. Subject to the terms and conditions of this Agreement, Danger hereby grants to T-Mobile the [ * ] to [ * ] (i) the [ * ], and (ii) the [ * ] under a combined [ * ] for a period of [ * ] from [ * ], but in any event, no later than [ * ]. If T-Mobile’s [ * ] to [ * ] terminate pursuant to Section 9.1, then the rights under this Section 9.5 shall terminate at the same time.

9.6 Regional Operators. Notwithstanding Sections 9.1 through 9.5, Danger may distribute without restriction any [ * ] and any [ * ] to any [ * ].

9.7 [ * ] Provisions. Except as expressly set forth in [ * ], or otherwise expressly set forth in this Agreement, each party acknowledges and agrees that the rights granted to and obligations due to the other party in this Agreement are [ * ], and that, without limiting the generality of the foregoing, nothing in this Agreement shall be deemed or construed to prohibit either party from participating with one or more third parties in business arrangements similar to or competitive with those described herein.

9.8 Right to [ * ] Notwithstanding any of the foregoing [ * ] provisions, Danger shall have the right to [ * ] and the Danger Services that would be subject to T-Mobile’s [ * ] for use in [ * ] with third party [ * ] and the [ * ]. In all such cases, the number of Danger Devices will be limited to no more than the reasonable number of Devices reasonably required to [ * ]. Except for other wireless carriers, the Devices that Danger [ * ] must be unmodified [ * ] as distributed by T-Mobile, including the same Danger Software that is included in Danger Devices sold by T-Mobile. For wireless carriers, the devices must have different software loads and cosmetic features (e.g. paint color, branding, etc.), and may not be Danger Devices that are [ * ] to T-Mobile and have yet to be commercially released. If such Danger Devices or Danger Services use the T-Mobile Network, then the users of such devices or service must be paying Subscribers unless otherwise agreed upon by the parties.

10. PAYMENTS/RECORD KEEPING

10.1 Danger Monthly Service Fees.

(a) Service Fees. T-Mobile shall pay Danger a per-Subscriber fee for each Active Subscriber (including Prepaid Subscribers) as set forth in the table below (the “Service Fee”). Service Fees shall be calculated on a pro rata daily rate, as described in Section (b) below. Unless otherwise agreed upon in writing by the parties and except for Premium Services, Danger will not charge T-Mobile any other fees for providing the Basic Service or for customizations or enhancements thereto. The

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Service Fees stated below will be applied on a “graduated” tax-table basis. For the purpose of clarity, the Service Fees payable by T-Mobile for the first [ * ] Subscribers will remain constant at [ * ] per Subscriber per month, while Services Fees for the next tier [ * ]+) will be paid at [ * ] per month, and so forth.

Subscribers	Monthly Service Fee
[ * ]	[ * ]
[ * ]	[ * ]
[ * ]	[ * ]

(b) Service Fee Calculation.

(i) “Post Paid” Subscribers. The Service Fees due for “post-paid” Subscribers shall be calculated based upon the following formula: T-Mobile will pay to Danger One-Thirtieth (1/30th) of the Service Fee for each calendar day that the Active Subscriber is active during the month. For example, the per calendar day Service Fee for the first [ * ] Subscribers will be One-Thirtieth (1/30) of [ * ] or [ * ] per day. If a Subscriber becomes an Active Subscriber on the tenth (10^th) of December, the Subscriber will be an Active Subscriber for twenty two (22) days in the month of December and T-Mobile shall owe Danger [ * ] for such Subscriber (22 X [ * ]). Invoices for Service Fees regarding Active Subscribers will be based upon the reports created by T-Mobile.

(ii) Prepaid Subscribers. The Service Fees due for Prepaid Subscribers will be calculated by the following formula: T-Mobile will pay to Danger One Thirtieth (1/30th) of the Service Fee for each 24-hour period for which a Prepaid Subscriber was an Active Subscriber during the calendar month. Section 6 describes when a Prepaid Subscriber is deemed an Active Subscriber and how billing and reporting for Prepaid Subscribers will be administered. For example, the per calendar day Service Fee for the first [ * ] Subscribers will be One-Thirtieth (1/30) of [ * ] or [ * ] per day. If a Prepaid Subscriber is an Active Subscriber for twenty-two (22) 24-hour periods in the month of December, T-Mobile shall owe Danger [ * ] for such Subscriber (22 X [ * ]. Invoices for Service Fees regarding Active Subscribers will be based upon the reports created by T-Mobile.

(c) Effective Date. The Service Fees stated above will be retroactive to June 1, 2005. Each party agrees that T-Mobile has paid to Danger amounts equal to the retroactive fees for the time period from June 1, 2005 through December 31, 2005. Upon execution of this Agreement, Danger shall invoice T-Mobile for the Services Fees due for any period for which T-Mobile has not paid the fees as calculable under this Agreement for the period from June 1, 2005 to the execution date of this Agreement, less amounts invoiced to T-Mobile for the Basic Services during such period (as adjusted by mutual agreement).

(d) Premium Services. Except for Premium Content, fees for Premium Services will be as mutually agreed upon by T-Mobile and Danger. Fees for Premium Content and reporting and billing administration for Premium Content are set forth in Exhibit D.

10.2 Churn Bonus.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(a) Terms. In addition to the Service Fee set forth in Section 10.1, for each month during the term of the Agreement in which the blended churn rate for all post-paid Subscribers (across all Danger Devices) is equal to or less than the blended churn rate reported quarterly by T-Mobile for its general subscriber base (the “Churn Threshold”) plus [ * ] basis points, T-Mobile will pay Danger an additional [ * ] [ * ] per Active Subscriber (both post-paid and Prepaid Subscribers) per month. For purposes of this calculation, a “basis point” is equal to one hundredth of a percent. For each month during the term of the Agreement in which the blended churn rate for all post-paid Subscribers (across all Danger Devices) is less than or equal to the Churn Threshold minus [ * ] basis points, T-Mobile will pay Danger an additional [ * ] [ * ] per Active Subscriber (both post-paid and Prepaid Subscribers) per month, for a total potential bonus of [ * ] [ * ] per Active Subscriber per month. T-Mobile will calculate the Churn Threshold and the blended churn rate for all post-paid Subscribers, and report such calculations to Danger on a quarterly basis within thirty (30) days of the end of the calendar quarter. Bonus amounts due will be calculated applying the methodology described in Section 10.1(b). If any bonus applies, Danger will invoice T-Mobile in accordance with the parties’ invoicing and payment procedures set forth below. Blended churn is churn calculated across the base of applicable post-paid Subscribers, as reported by T-Mobile. The churn figures that will form the basis for the additional payments described herein will be reported by T-Mobile to Danger at the same time T-Mobile and/or its parent company discloses its general churn numbers to the public.

(b) First Six Months. Notwithstanding Section 10.2(a), for the period from June 1, 2005 to December 1, 2005, the Churn Threshold for triggering the additional bonus payments in Section 10.2(a) will be [ * ] of the difference between Danger’s blended churn rate for the quarter ended June 30, 2005 and T-Mobile’s blended churn rate for the quarter ended June 30, 2005. For example, if the blended churn rate for the quarter ended June 30, 2005 calculated across all post-paid Subscribers is [ * ]% and T-Mobile’s reported blended churn rate for the quarter ended June 30, 2005 is [ * ]%, the Churn Threshold will be [ * ]%. If the July 2005 blended churn rate for post-paid Subscribers was equal to or below [ * ]%, Danger would earn an additional [ * ] per Subscriber (both post-paid and Prepaid Subscribers) for July, and if the blended churn rate for post-paid Subscribers was equal to or below [ * ]% Danger would earn an additional [ * ] per Subscriber (both post-paid and Prepaid Subscribers) for July, for a total bonus of [ * ] per Subscriber. Following the execution of this Agreement, T-Mobile shall perform the appropriate calculation and pay Danger any Bonus that is due under this paragraph 10.2(b).

10.3 Subscriber Tracking. Danger will, at its sole cost, collect and report to T-Mobile Subscriber usage and other information requested by T-Mobile. The information to be collected and reported by Danger pursuant to this Section 10.3 and the format of such reports, will be mutually agreed to by the parties.

10.4 Subscriber Billing. T-Mobile, in its sole discretion, shall control and administer the amounts and the process by which Subscribers may be charged such amounts, if any, as T-Mobile establishes in its sole discretion with respect to access to and/or use of the Danger Services. T-Mobile, at its own cost, will be responsible for the billing and collecting of such amounts from Subscribers.

10.5 Post-Paid Billing Reports. Within ten (10) business days after the end of each calendar month during the Term, T-Mobile will deliver to Danger a billing report (collectively the “Post-paid Billing Report”) that details the Service Fees due for such calendar month and data for Active Subscribers for such calendar month so that Danger can verify T-Mobile’s calculation of the Service Fees due. The Post-paid Billing Report shall include, at a minimum, the aggregate amount of Service Fees due and the following items by Subscriber: IMSI, MSISDN, initial billing date, billing start date for the month, billing end date for the month, number of billable days, amount owed to Danger for that Subscriber.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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10.6 Payment. T-Mobile will pay to Danger the amounts set forth in the Prepaid Billing Report and Post-paid Billing Report (collectively, the “Billing Report”) within thirty (30) days of the end of the preceding month. Notwithstanding the foregoing, in the event that T-Mobile does not deliver the Billing Report within twenty (20) business day of the end of the applicable calendar month, Danger shall have the right to invoice T-Mobile for Service Fees dues for such month based on Danger’s records and T-Mobile shall pay such invoiced amounts within thirty (30) days. Payments for Premium Content shall be invoiced and paid in accordance with Exhibit D.

10.7 Reconciliation of Fees.

(a) Within ten (10) business days of Danger’s receipt of T-Mobile’s Billing Report, Danger shall notify T-Mobile if it believes any of the data or payments by T-Mobile are inaccurate and shall provide T-Mobile with a report showing the discrepancies (the “Reconciliation Report”). Such report shall provide the same detail, by Subscriber, as the Billing Report. The parties shall then confer in good faith to determine if T-Mobile’s Billing Report failed to include Active Subscribers that should have been billed. If the Billing Report was inaccurate, then any amounts (credits or debits) that are agreed upon shall be applied to T-Mobile’s payments for Service Fees for the next calendar month. The parties shall perform a similar reconciliation procedure in the event Danger invoices T-Mobile in accordance with Section 10.6.

(b) On a quarterly basis, T-Mobile and Danger will confer in good faith to determine whether there are users of the Danger Services that are not being counted as Active Subscribers (and are not otherwise accounted for by other authorized use, such as testing and development). If there are unauthorized users, then T-Mobile and Danger will use commercially reasonable efforts to determine how such users are accessing the Danger Service, to prevent such unauthorized access, and will mutually agree on timing for deactivating such users.

(c) At least once per calendar quarter, the parties shall synchronize their records of deactivated Subscribers by sharing deactivation reports. Either party may initiate such process by making a written request (including by e-mail) to the other party.

(d) During the Term and for two (2) years thereafter, T-Mobile shall maintain all Billing Report records and Danger shall have the right to audit such records under the same terms as described in Section 10.8 below.

10.8 Record Keeping and Audit. During the Term and for [ * ] thereafter, Danger shall maintain detailed, accurate records relating to the Danger Services and calculations of the fees payable by T-Mobile pursuant to this Agreement. T-Mobile, at its expense, and upon thirty (30) days advance notice to Danger, shall have the right no more than [ * ] per year during the Term, and for a [ * ] period thereafter, to have an independent accounting firm, reasonably acceptable to Danger (a) examine or audit records and (b) inspect Danger’s facilities and procedures in order to verify Danger’s compliance with this Agreement (including, without limitation, the figures reported and amounts invoiced by Danger, most favored nation pricing, performance monitoring and Outage information, and verification of increased costs for new services). Any such audit or inspection shall be conducted, to the extent possible, in a manner that does not interfere with the ordinary business operations of Danger. The auditor shall be required to sign a confidentiality agreement prescribed by Danger and shall not be entitled to disclose to T-Mobile any confidential information related to Danger’s other customers or partners, [ * ]. If any audit reveals an overpayment of amounts owed or non-compliance with Section [ * ], Danger will credit T-Mobile on a prospective basis against future Service Fees for the amounts overpaid between the date that T-Mobile made the payment and the date of such credit. If T-Mobile is no longer providing Danger

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Services to T-Mobile, then Danger will reimburse T-Mobile for any over payment by T-Mobile. If such overpayment is more than five percent (5%) of the amounts owed by T-Mobile under the period audited, Danger will reimburse T-Mobile the reasonable cost of such audit.

10.9 Taxes. The payments to be made by T-Mobile to Danger do not include sale or use taxes. If Danger is required to pay sales or use taxes based upon the amounts paid by T-Mobile under this Agreement, then such taxes shall be billed to T-Mobile and paid by T-Mobile to Danger and Danger shall (i) remit the same to all applicable taxing authorities as required by law, and (ii) provide to T-Mobile official tax receipts indicating that such taxes have been so remitted. Danger shall reasonably cooperate with T-Mobile to lawfully minimize the imposition of any taxes. To the extent T-Mobile or the transactions contemplated by this Agreement may be exempt from such taxes, Danger will not pay any taxes on behalf of T-Mobile if T-Mobile provides Danger a tax certificate exemption (including, without limitation, a resale certificate). Danger is responsible for and shall pay and hold T-Mobile harmless against all other taxes arising by reason of or in connection with this Agreement, including, but not limited to, taxes based on Danger’s income and any employment related taxes applicable to Danger’s employees and contractors.

10.10 Legacy Payment Terms. For purposes of clarity, the parties agree that no “Hardware Fees” (as defined in the Original Agreement) shall be due to Danger under this Agreement. Likewise, unless otherwise agreed by the parties, no one time “client license” fees will be due to Danger under this Agreement. The purchase price of any Danger Device will be determined between T-Mobile and the Manufacturer. No “Qualified Return Fees” or “NTF Fees” shall be due to T-Mobile under this Agreement.

11. [ * ]

11.1 Pricing. The prices and fees charged to T-Mobile by Danger for Danger Services hereunder will be under [ * ] terms (“[ * ]”), and such terms will not [ * ] products or services with [ * ] features and functionality. Danger shall provide T-Mobile with [ * ] for all prices, charges, cost, and fees charged to T-Mobile, including, without limitation, service fees for all services and service offerings (including, without limitation, Basic Services, Premium Services (excluding Danger Premium Content)), software, and development costs and resources. If [ * ] such products or services, Danger will immediately notify T-Mobile and will [ * ] hereunder, and provide such products or services [ * ]. The [ * ] charges and fees incurred as of the date [ * ] and to any products ordered by T-Mobile or scheduled to be delivered to T-Mobile as of the date [ * ] subject to this Section. Danger will [ * ] to T-Mobile for [ * ] and the [ * ], but if Danger [ * ] to T-Mobile, then Danger will [ * ].

11.2 [ * ] If, during the Term, Danger enters into an agreement or business relationship (including, without limitation, a joint venture or partnership) where a third party (other than a majority owned affiliate of Danger) is given the right (by license, or otherwise), directly or indirectly, to operate and/or host the Danger Service, Danger agrees to promptly [ * ] such third party (including without limitation, [ * ]). If T-Mobile decides, in its sole discretion, to [ * ], Danger will promptly execute all necessary documents and agreements to [ * ]. If T-Mobile decides, in its sole discretion, to continue [ * ], then the [ * ] T-Mobile will be [ * ], taking into account a pro rata allocation of the cost of [ * ] in proportion to the cost for such [ * ].

12. INTELLECTUAL PROPERTY RIGHTS

12.1 Right to Distribute Danger Devices. Danger hereby appoints T-Mobile, for the Term of this Agreement, as an authorized, non-exclusive (except as provided herein) distributor of the Danger Service

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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to Subscribers solely within the United States, either directly or through the use of a multi-tiered distribution network. As part of the materials included with Danger Devices, T-Mobile will include an end-user license agreement (an “End User License”) in the form attached hereto as Exhibit G. T-Mobile may not modify the End User License without the prior written approval of Danger, which approval shall not be unreasonably withheld.

12.2 Reverse Engineering. T-Mobile itself shall not (a) reverse assemble, reverse compile, decrypt, extract, or otherwise attempt to discover any source code (or other underlying data) of the Danger Software or Danger Technology, except as permitted herein for purposes of this Agreement; or (b) modify, adapt or create a derivative work of any part of the Danger Software or Danger Technology, except as permitted herein for purposes of this Agreement.

12.3 Danger Ownership. Danger and its licensors shall retain all rights, title and interest in and to the technology contained within or constituting the Danger Services (except the T-Mobile Premium Content and any technology provided by T-Mobile), T-Mobile interface (except for any technology or trademarks provided by T-Mobile), Danger System Data, Danger Software, Danger Premium Services and all Intellectual Property Rights therein, and all derivative works or modifications thereof (the “Danger Technology”).

12.4 T-Mobile Ownership. T-Mobile and its licensors retain all rights, title and interest in and to the T-Mobile technology and T-Mobile Premium Content owned by T-Mobile (except for any Danger Technology that may be contained in such T-Mobile Premium Content).

12.5 License to Danger. Subject to the restrictions of Section 14.2, T-Mobile hereby grants Danger a limited, non-exclusive, and non-transferable (except in connection with 21.1) license to use and copy Aggregate Information solely for those purposes stated in Section 14.2(d).

12.6 Mutual License Grant of Trademarks. Subject to all the terms and conditions of this Agreement, each party (“Licensor”) hereby grants the other party (“Licensee”) a nonexclusive, non-transferable, non-sublicensable license to use the Licensor Marks solely as identified in, and in the manner described in, Exhibit H. “Licensor Marks” means solely the names, trademarks, service marks and logos as provided by Licensor in writing specifically for use under this Agreement. However, Licensor, in its sole discretion from time to time, may upon written notice change the appearance and/or style of any Licensor Mark or add or subtract from the Marks previously supplied. Unless required earlier by a court order or to avoid potential infringement liability, Licensee will have a reasonable period of time to implement any such changes and if Licensor requires any changes to materials that have already been produced, the Licensor will pay the Licensee for any costs involved in such change. Licensee hereby acknowledges and agrees that (i) the Licensor Marks are owned solely and exclusively by Licensor or its affiliates, (ii) except as set forth herein, the Licensee has no rights, title or interest in or to the Licensor Marks and (iii) all use of the Licensor Marks by Licensee will inure to the benefit of Licensor and its affiliates. Licensee agrees not to apply for registration of the Licensor Marks (or any mark confusingly similar thereto) anywhere in the world. Licensee agrees that it will not engage, participate or otherwise become involved in any activity or course of action that diminishes and/or tarnishes the image and/or reputation of Licensor or of any Licensor Mark. Licensee acknowledges and agrees that the presentation and image of Licensor’s Marks should be uniform and consistent with respect to all services, activities and products associated with the Licensor’s Marks.

12.7 Trademark Use and Brand Confusion. Danger agrees to refrain from describing Danger Devices branded “T-Mobile Sidekick” as “hiptops” in the consumer press and consumer messaging. For instance, when describing a celebrity who endorses or uses a device branded “T-Mobile Sidekick,”

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Danger shall not make statements in consumer magazines or the popular press that such celebrity uses a “hiptop” device.

13. ESCROW

13.1 Escrow Agreement. The current Master Preferred Escrow Agreement #041205 (the “Escrow Agreement”), dated June 30, 2005 with DSI Escrow Services, Inc. (aka Iron Mountain Incorporated) (the “Escrow Agent”), shall remain in effect during the Term, unless otherwise modified or terminated by mutual agreement of the parties. Danger shall place into escrow the Source Code, object code and related documentation for the Danger Service (the “Escrowed Code”). All subsequent major version upgrades, enhancement and documentation or bug fixes for the Danger Service will also be deposited with the Escrow Agent after acceptance by T-Mobile. The Escrowed Code shall include the source code for software licensed by Danger from third parties only to the extent Danger has the rights to do so. For third party software that Danger does not have rights to escrow in source code form, Danger shall use reasonable efforts to obtain the right to deposit object code of such third party software for release to T-Mobile in conjunction with an escrow release hereunder. T-Mobile shall bear the cost of maintaining the software in escrow (to be billed by the Escrow Agent or invoiced by Danger).

13.2 Release of Escrowed Code. In addition to and not in limitation of any other rights or remedies of T-Mobile, the Escrowed Code will be delivered to T-Mobile for use, copying and modification in connection with T-Mobile’s separate implementation of the Danger Service (which may include T-Mobile providing the Danger Service to T-Mobile-Related Companies) upon the occurrence of any of the following conditions (each, a “Release Condition”):

(a) [ * ];

(b) Danger ceases to provide the Danger Services for a period of [ * ], except due to a force majeure event under Section 23.6;

(c) Danger has [ * ] catastrophic Danger Service Outages (as defined in the SLA) in any calendar year, except due to a force majeure event under Section 23.6;

(d) [ * ].

13.3 License; Ownership.

(a) Subject to the terms and conditions of this Section 13, Danger hereby grants and agrees to grant to T-Mobile a non-exclusive, non-transferable (except pursuant to Section 21.1) perpetual license to use, copy, and create derivative works of the Escrowed Code following the occurrence of any Release Condition, solely for the purposes specified in Section 13.2 (i.e., T-Mobile’s separate implementation of the Danger Service) and solely within the scope of this Agreement.

(b) The license granted to T-Mobile in Section 13.3(a) will be subject to a fair and reasonable market-value royalty (minus any costs incurred by T-Mobile) as determined by an independent third party appraisal, with the appraiser to be selected by the mutual agreement of the parties. T-Mobile may offset any damages, including lost revenues, due to Danger’s breach or nonperformance of this Agreement, against any royalties that may be due pursuant to this Section. T-Mobile will be the exclusive owner of any modifications to or derivative works of the Escrowed Code created by or for T-Mobile under this Section 13.3.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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13.4 Manufacturers. Danger shall provide each Manufacturer of Danger Devices (excluding authorized distributors) the right to obtain the Source Code for the Danger Software under escrow terms, release conditions, and license terms that are substantially similar to those provided to T-Mobile for the Danger Service Source Code hereunder.

14. Confidentiality, Security, Law Enforcement

14.1 Confidential Information.

(a) The parties acknowledge that each may be given access to certain confidential, proprietary or secret information and material relating to or owned by the other, including but not limited to financial information, pricing information, supplier lists, customer lists, files and other information regarding individual customers, and information regarding that party’s business, organization and operations, in the course of the performance under this Agreement. Such information and material shall be the sole and exclusive property of the provider of such information, and each party agrees that during the term of this Agreement and at all times thereafter the receiving party will not disclose such confidential, proprietary or secret information or material, or the terms of this Agreement, to any governmental agency, person, entity, firm or corporation without the explicit prior written consent of the other. This Section shall not apply to any information (a) previously known to either party free of any obligation to keep it confidential; (b) that has been or which becomes publicly known, through no wrongful act of either party; (c) which is rightfully received from a third party who is under no obligation of confidence to either party; or (d) which is independently developed by the receiving party without resort to information that has been disclosed pursuant to this Agreement. This Section shall also not apply to information which is required to be disclosed in order to comply with applicable law or regulation (including, without limitation, SEC compliance) or with any requirement imposed by judicial or administrative process or any governmental or court order, provided however that the party making such disclosure must provide notice to the other party, to the extent possible, at the earliest practicable time prior to such disclosure.

(b) The parties agree that this Agreement is confidential and subject to the provisions set forth in Section 14.1(a) above; provided however that either party may provide copies of this Agreement to its auditors, attorneys, investors and financial advisors that are bound in writing to keep information of this nature confidential.

14.2 Subscriber Data.

(a) T-Mobile will have sole and exclusive ownership of and rights to collect, store, and use all Subscriber Data received by T-Mobile or Danger in the course of any Subscriber’s use of the Danger Devices or Danger Services.

(b) Danger may not use, disclose, or provide to any third party (including subsidiaries and affiliates), any Subscriber Data except for the purpose of providing the Danger Services. Notwithstanding the foregoing, Danger may disclose Subscriber Data in response to a court order, subpoena request, or law enforcement investigation. If the FCC or any state or federal government regulatory authority implements rules regarding the use, storage, or dissemination of Subscriber Data, Danger will comply with and implement any procedures required by such rules or regulations. If Danger’s compliance with and implementation of procedures required by such rules or regulations result in Danger incurring material additional costs, the parties shall discuss in good faith whether T-Mobile will pay for any such costs. Irrespective of an agreement (if any) between the parties on such costs, Danger

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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shall be required to comply with all applicable rules and regulations issued by the FCC or any state or federal regulatory authority regarding the use, storage, or dissemination of Subscriber Data.

(c) Danger may not provide, authorize, or allow any third party (including subsidiaries and affiliates) to provide, any Subscriber Data to any wireless carrier or any non-United States government.

(d) Without limiting the foregoing, Danger will be permitted to use Aggregate Information only for purposes of operating, monitoring, maintaining, developing, and improving the Danger Service and Danger Software. In addition, without T-Mobile’s prior consent, Danger may publicly disclose data related to aggregated, world-wide use or performance of the Danger Software and the Danger Service, provided such disclosures could not reasonably be understood or used to state or imply specific numbers about the number of users of Danger services. For example, Danger could announce, without T-Mobile’s prior consent, that the Danger Service carried over 1,000,000 instant messages world-wide in a single day. If any proposed disclosure could reasonably be understood to state or imply specific numbers about the number of Danger users, such disclosures may not be made without T-Mobile’s prior consent, which consent shall not be unreasonably withheld or delayed. For instance, Danger would be required to obtain T-Mobile’s prior consent to announce that Danger completed OTA updates to the 1,000,000 Danger Devices in use in the United States. Notwithstanding the foregoing, in the event that T-Mobile Subscribers represent less than 75% of all Danger users, Danger may make disclosures that state or imply the number of Danger users; provided however, Danger’s disclosures shall not state or imply the number of T-Mobile Subscribers.

(e) Department of Justice Agreement. T-Mobile has entered into an agreement with the Federal Bureau of Investigation and the Department of Justice that requires parties contracting with T-Mobile to comply with applicable terms. Danger agrees as follows, provided that (i) if compliance with the following requires Danger to materially change its usual business operations (but not including changes required under other sections of this Agreement), and such changes materially increase Danger’s costs to meet the following requirements, then the additional costs to meet such requirements shall be borne by T-Mobile, and (ii) Danger shall provide reasonable notice to T-Mobile of any such additional costs before they are incurred, and all such costs are subject to T-Mobile’s prior written approval, which may not be unreasonably withheld:

(i) Danger shall not throughout the term of this Agreement or at any time thereafter store Subscriber audio or data communications occurring in the U.S., or any other Subscriber information, including, without limitation, call transactional data, call associated data, call identifying data, Subscriber information and Subscriber billing records (collectively, “DOJ Subscriber Information”) outside of the United States without T-Mobile’s prior written consent, which may be withheld for no reason, or any reason, in T-Mobile’s sole discretion;

(ii) Danger will provide T-Mobile with at least thirty (30) days prior written notice of its desire to store DOJ Subscriber Information outside the United States, including description of the communications and/or information, identification of the custodian, identification of the proposed location where the communications and/or information would be stored; and identification of the factors it considered in seeking to store the communications and/or information outside the United States;

(iii) Danger will store billing records relating to T-Mobile Subscribers for a minimum period of two years;

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(iv) Danger will store DOJ Subscriber Information in its possession, custody and control if requested by a domestic governmental entity pursuant to 18 U.S.C. § 2703(f);

(v) Danger will store DOJ Subscriber Information in a manner such that the communications and/or information do not become subject to mandatory destruction under any foreign laws;

(vi) Danger will make available to the DOJ in the United States all DOJ Subscriber Information that is stored by Danger or a third party (as permitted under this Agreement);

(vii) Danger will not disclose DOJ Subscriber Information to any foreign government or entity without first (i) satisfying all applicable U.S. federal, state and local legal requirements, including receiving appropriate authorization by a domestic U.S. court, or receiving prior written authorization from the U.S. Department of Justice, and (ii) notifying T-Mobile of the request for such information within five (5) days of its receipt;

(viii) Danger will protect the confidentiality and security of all lawful U.S. process and the confidentiality and security of classified information and sensitive information in accordance with federal and state laws and regulations.

(f) Subscriber Data Protections. Danger will securely protect Subscriber Data, Subscriber passwords and DST access using security procedures, encryption, and firewall protections that have been reasonably agreed upon by T-Mobile and Danger. T-Mobile shall instigate and maintain a similar level of security procedures to control access to Subscriber Data and DST within T-Mobile’s operational centers.

14.3 Security.

(a) Documentation. Danger has provided to T-Mobile highly confidential security documentation that comprehensively describes in detail the overall architecture of the Danger Service, including (but not limited to) encryption methodologies (except for security key values), operational practices, entry points to the Danger Service, and connection points between Danger and its operator partners. The Security Information Confidentiality Agreement, dated July 1, 2005, between the parties (the “Security NDA”) shall govern T-Mobile’s use of and access to any Danger Service security related information, including the documentation described in this Section. Only T-Mobile employees listed in such agreement may view the security documentation.

(b) Regular Security Self Assessment. Danger shall perform regular security self assessments within appropriate time frames, as determined by Danger. Optionally, Danger may contract an external third party to perform the security assessment referred to as audit. Danger shall use reasonable efforts to conduct regular self assessments or audits for all connected systems, applications, and the complete network supporting the Danger Service. Danger will provide to T-Mobile all relevant results of such audits and any action plans that result from an audit or self-assessment.

(c) T-Mobile Security Audit. T-Mobile may conduct a security audit of the Danger System one (1) time per year, or any additional time if T-Mobile documents irregularities with the Danger Service that indicate the operation of the Danger Service may be insecure or if T-Mobile documents a reasonable belief that there may be attacks being made against the Danger System from an external source not accessing the Danger System through the T-Mobile network and system. Any such audit shall be conducted by a third party in accordance with the following procedure: On no less than ten (10) business

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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day’s notice (except that an audit can occur on an expedited basis if there has been an actual security breach of the Danger Services), an independent third-party auditor reasonably selected by T-Mobile and reasonably acceptable to Danger shall visit Danger’s premises during normal business hours to inspect and audit the systems that support the Danger Service. The sole purpose of the audit shall be to determine whether Danger complies with its security documentation and if a security breach has occurred or is likely to occur. As a condition to the audit, the independent third-party auditor and T-Mobile will be required to execute a three-party confidentiality agreement proscribed by Danger. This confidentiality agreement will not permit the third party auditor to forward any information to T-Mobile, except for the final audit report. Such audit will be conducted in a manner that does not unreasonably interfere with the ordinary conduct of the Danger’s business or generate unreasonable cost to Danger. Danger and T-Mobile shall each be presented with a report on the results of the audit following its completion. Such report and any other information regarding the audit shall be deemed confidential Danger security information governed by the Security NDA. T-Mobile will bear the costs of such audit. T Mobile is entitled to trigger a security audit no more often than two (2) times per calendar year; provided however, if the assessment or audit determines that material security issues exist for the Danger Service, T-Mobile may trigger additional assessments or audits during the same calendar year. T-Mobile acknowledges that its affiliate T-Mobile Deutschland GmbH has similar security audit rights and agrees not to exercise its security audit rights under this Section within six (6) months of a T-Mobile Deutschland GmbH security audit; provided T-Mobile has been given access to the results of such recent T-Mobile Deutschland audit.

14.4 T-Mobile Security Requirements. Danger shall have the right to audit T-Mobile network components that have privileged access to the Danger systems and information if there are circumstances that reasonably indicate compromises in the security of such components. Any such audit shall follow the procedures set forth in Section 14.3 for an audit of Danger’s network security. T-Mobile shall securely encrypt and safeguard Subscriber passwords and customer care passwords. T-Mobile systems that access the Danger System shall operate at an equal or greater level of security as the Danger Systems that access the T-Mobile network.

14.5 Irreparable Harm. In the event that either party breaches the provisions of Sections 12, 13.3 or 14, the other party is likely to suffer irreparable injuries for which monetary damages will be insufficient. Therefore, in addition to any other remedies provided at law, equity, statute or this Agreement, the non-breaching party will be entitled to injunctive relief, including, without limitation, specific performance of the breaching party’s obligations, without the requirement for the posting of a bond or other comparable security. This Section shall survive any termination of this Agreement.

14.6 Law Enforcement. Danger will cooperate with any law enforcement officials and T-Mobile in regard to any law enforcement or investigations as requested by T-Mobile or the applicable law enforcement official.

15. REPRESENTATIONS AND WARRANTIES.

15.1 Each party represents and warrants to the other party that:

(a) it has the full corporate right, power, and authority to enter into this Agreement and to perform its obligations hereunder;

(b) its execution of this Agreement and performance of its obligations hereunder, do not and will not violate any agreement to which it is a party or by which it is bound; and

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(c) when executed and delivered, this Agreement will constitute the legal, valid and binding obligation of such party, enforceable against it in accordance with its terms.

15.2 Warranty for Danger Services and Danger Software.

(a) During the Term, the Danger Services and Danger Software shall at all times comply with all required federal, state and local laws, rules, regulations, and codes in existence during the Term (including without limitation, FCC rules, regulations and requirements).

(b) During the Software Warranty Period (as defined below), the Danger Software will conform to (i) the applicable Danger Software Specification and (ii) all required and applicable (as of the date of T-Mobile’s approval of the Danger Software) Internet standards, PTCRB standards and all other relevant industry specifications and standards, that are required because of the features provided for in the applicable specification. The “Software Warranty Period” for a copy of the Danger Software shall be [ * ] months from the date the Danger Device containing that Danger Software was first delivered to T-Mobile by the Manufacturer. T-Mobile will allow Manufacturers to provide Danger with Danger Device delivery data, including IMEIs by date of delivery, to enable Danger to track its warranty obligations.

(c) During the applicable Support Period for each Danger Device model (as defined in Section 7.6), the Danger Service that interoperates with the Danger Software release for such Danger Device Model shall at all times conform (i) to the applicable Danger Service Specification, and (ii) all required and applicable (as of the date of the launch of the Danger Service) Internet standards and all other relevant industry specifications and standards, that are required because of the features provided for in the applicable specification.

(d) The Danger Services and the Danger Software (excluding T-Mobile Premium Content) do not and will not constitute a misappropriation or infringement of any Intellectual Property rights of any third party.

(e) Throughout the Term, Danger will not insert, and will not knowingly allow any third party to insert, any disabling mechanism, protection feature, or device designed to prevent use of the Danger Services, Danger Software, or any portion thereof, or any computer system, software, or hardware of T-Mobile, including, without limitation, any clock, timer, counter, computer virus, worm, software lock, drop dead device, Trojan-horse routine, trap door, time bomb or any other codes or instructions that may be used to access, modify, replicate, distort, delete, damage, or disable the Danger Services, Danger Software, or any other computer system, software, or hardware of T-Mobile, except as specifically designed as part of the Danger Services, or Danger Software with T-Mobile’s knowledge and consent;

(f) Throughout the Term, Danger shall implement reasonable security measures to prevent the unauthorized disclosure, copying or use of Subscriber Data or interference with any Danger Service by unauthorized third parties by (a) providing and utilizing lockable, restricted-access working facilities and restricted-access storage means or secured networks at all times, (b) using efforts at least equal to the efforts Danger uses to protect its most confidential materials or its own trade secrets (but in no event less than reasonable efforts), (c) complying with Danger’s security documentation provided to T-Mobile pursuant to Section 14.3, (d) promptly investigating and reporting to T-Mobile any loss, theft or unauthorized disclosure, use or attempt to gain access to the Danger Services, and (e) use Subscriber Data storage processes and security methods that have been reasonably agreed upon by T-Mobile and Danger.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(g) Throughout the applicable Support Period for the Danger Services, and throughout the applicable Software Warranty Period for Danger Software, the Danger Services and the Danger Software will provide and receive all date-related data in an accurate and uninterrupted manner and, without limiting the generality of the foregoing will: (i) provide for data century recognition and calculations accommodating same century and multi-century formulae and date values; (ii) manage and manipulate data involving dates, including single and multi-century scenarios; and (iii) if the Danger Services or Danger Software contain date-related user interface functions or date-related data fields such functions and data fields will indicate date and time.

(h) Notwithstanding anything in this Section 15.2, Danger makes no warranties with respect to software or services provided to Danger directly by T-Mobile (“T-Mobile Software”). If changes in T-Mobile’s network cause the Danger Service, Danger Software or Danger Devices to fail to conform to the warranties provided herein or to otherwise malfunction, and T-Mobile failed to notify Danger of such change to T-Mobile’s network and did not provide a minimum period of [ * ] to allow Danger to make adjustments for such network changes, then Danger shall not be deemed to be in breach of the warranties in this Section. In addition, Danger shall not be deemed to be in breach of this Agreement if the Danger Service, Danger Software or Danger Devices to fail to conform to the warranties provided herein or to otherwise malfunction as a result of T-Mobile Premium Content. Danger shall not be liable for a failure of the Danger Software or Danger Service to conform to the warranties set forth herein if T-Mobile has provided a written waiver to Danger that expressly waives such warranty and allows Danger to deviate from the warranty.

15.3 Remedy. In the event of a material breach of any of the warranties in Section 15.2(a) – (c), T-Mobile shall notify Danger in writing of such material breach with reasonable detail and Danger shall have a [ * ] period from the date of T-Mobile’s notice to repair or replace the Danger Software or Services so that they conform to the foregoing warranties. Only after such [ * ] period has expired and Danger has failed to repair or replace the Danger Software or Services so that they conform to the warranties in Section 15.2(a)-(c), may T-Mobile exercise its rights and remedies as set forth in this Agreement, at law, equity or otherwise with respect to such material breach. Danger shall have no obligation to repair or replace (i) Danger Software that is no longer within the Software Warranty Period and (ii) Danger Services that are no longer within the Support Period. Danger and T-Mobile agree to use an OTA (over the air) upgrade to cure any Danger Software defects wherever technically practicable and commercially reasonable.

15.4 End User Warranty Processing. As between the parties, Danger shall have no obligation to process for Danger Device warranty returns, whether for hardware, Danger Service or Danger Software reasons. T-Mobile shall be responsible for managing (with Manufacturers and their agents) all post-sales support for Subscriber warranty returns, including, but not limited to, in-warranty and out-of-warranty servicing of Danger Device returns and repairs, reverse logistics management, and replacement or “seed-stock” support. This Section 15.4 shall not be construed in a manner that waives T-Mobile’s rights under Section 15.2.

15.5 Disclaimer. EXCEPT AS EXPRESSLY PROVIDED OTHERWISE IN THIS AGREEMENT, NEITHER PARTY MAKES ANY WARRANTIES WHATSOEVER WITH RESPECT TO THE DANGER DEVICE, DANGER SERVICE, OR T-MOBILE NETWORK PROVIDED UNDER THIS AGREEMENT, INCLUDING WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. ALL SUCH WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED. EXCEPT AS EXPRESSLY PROVIDED OTHERWISE

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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IN THIS AGREEMENT, INCLUDING THE SERVICE LEVEL AGREEMENT, ALL SUCH WARRANTIES ARE HEREBY DISCLAIMED.

16. EXCLUSION OF CONSEQUENTIAL DAMAGES. EXCEPT FOR (i) BREACHES OF SECTION 14.1, 14.2, and 14.3 (CONFIDENTIALITY AND SECURITY), (ii) BREACHES OF SECTION 12.1, 12.2, 12.3, 12.4, 12.5 or 12.6 (INFRINGEMENT OF THE OTHER PARTY’S INTELLECTUAL PROPERTY), (iii) AN INTENTIONAL BREACH OF SECTION 13.3(a), (iv) BREACH OF SECTION 15.2(f), AND (v) THE INDEMNITY OBLIGATIONS UNDER SECTION 17, UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR LOST PROFITS OR FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES ARISING FROM THE SUBJECT MATTER OF THIS AGREEMENT, REGARDLESS OF THE TYPE OF CLAIM AND EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, SUCH AS, BUT NOT LIMITED TO, LOSS OF REVENUE, LOST DATA, OR ANTICIPATED PROFITS OR LOST BUSINESS.

17. INDEMNITY.

17.1 Danger will hold harmless and indemnify T-Mobile and its current and former subsidiary and parent entities, predecessors, successors, and permitted assigns, and all of their respective current and former officers, directors, members, stockholders, agents, employees, and attorneys (the “Indemnified Parties”) from any and all Indemnified Claims. “Indemnified Claims” means any and all actions, causes of action, suits, proceedings, claims, demands, judgments, bona fide settlements, penalties, damages, losses, liabilities, costs, and expenses (including without limitation T-Mobile’s reasonable attorneys’ fees and costs and those necessary to interpret or enforce this Section 17) arising out of or relating to any third party claim or allegation:

(a) that if true, would establish (i) Danger’s breach of this Agreement, including without limitation any of its representations and warranties set forth in Section 15 above; (ii) Danger’s misrepresentation, fraud or other willful misconduct in connection with its acts or omissions relating to this Agreement; (iii) the Danger Services or Danger Software contain any material that is unlawful, obscene, or defamatory or violates, infringes, or misappropriates any Intellectual Property Right or any other right of any third party; or (iv) any wrongful use or unauthorized disclosure of Subscriber Data by Danger; and

(b) that arises out of (i) any act or omission of Danger or Danger’s subcontractors or agents relating in any way to Danger’s performance or obligations under this Agreement; or (ii) the bodily injury or death of any person, or the loss of or damage to the property of any person, that results from the use of the Danger Services; or (iii) any alleged error, problem, defect or malfunction related to the design of any Danger Service.

(c) Notwithstanding anything in this Section 17, Danger shall have no obligation to indemnify or defend T-Mobile for any Indemnified Claim alleging that the T-Mobile Software or T-Mobile Premium Content is unlawful, obscene, defamatory, or violates, infringes or misappropriates any Intellectual Property Right or any other right of any third party.

17.2 Danger will defend the Indemnified Parties from any and all Indemnified Claims. Danger will pay all reasonable attorney and expert fees and costs relating to such defense and will conduct all steps or proceedings in connection with such defense and as required to settle or defend such Indemnified Claims, including without limitation the employment of counsel reasonably satisfactory to T-Mobile. Danger shall have the primary control of the defense of any Indemnified Claim but may not take any steps that

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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would cause T-Mobile to admit liability or affect T-Mobile’s rights or interests in any legal action without T-Mobile’s prior written consent. At all times, T-Mobile may participate in the defense using its own legal counsel, and at its own expense. T-Mobile may, however, by providing notice to Danger, assume sole and exclusive control of such defense and settlement at its own cost (including without limitation by employing the same counsel or different counsel reasonably satisfactory to both T-Mobile and Danger), provided that T-Mobile will not enter into any settlement that affects Danger’s rights or interests without the prior written consent of Danger.

17.3 T-Mobile will provide Danger with reasonably prompt written notice of any Indemnified Claim. At Danger’s expense, T-Mobile will provide reasonable cooperation to Danger in connection with the defense or settlement of any such claim. Danger may not settle any Indemnified Claim on T-Mobile’s behalf without first obtaining T-Mobile’s written permission, which permission will not be unreasonably withheld. Danger will make any payments required of it under this Section 17.3 on T-Mobile’s demand. Following T-Mobile’s request, Danger will not disclose such settlement and its terms to any third party, directly or indirectly, without T-Mobile’s prior, written permission or an order from a court of competent jurisdiction; provided however, Danger may provide such information to its auditors, attorneys, investors and financial advisors that are bound in writing to keep information of this nature confidential.

17.4 T-Mobile will hold harmless and indemnify Danger and its current and former subsidiary and parent entities, predecessors, successors, Affiliates, and assigns, and all of their respective current and former officers, directors, members, stockholders, agents, employees, and attorneys from any and all actions, causes of action, suits, proceedings, claims, demands, judgments, bona fide settlements, penalties, damages, losses, liabilities, costs, and expenses (including without limitation Danger’s reasonable attorneys’ fees and costs and those necessary to interpret or enforce this Section 17) arising out of or relating to any third party claim or allegation relating to (i) T-Mobile’s breach of this agreement, (ii) an outage or interruption of T-Mobile’s network, or (iii) the T-Mobile Software or a T-Mobile Premium Service that is either provided directly by T-Mobile or by a third party with whom T-Mobile has contracted to provide services via Danger Devices where the claim relates to either (a) the alleged infringement of a third party’s intellectual property right by some component of such T-Mobile Software or T-Mobile Premium Service, or (b) damages or liability that is attributable to such T-Mobile Software or T-Mobile Premium Service. T-Mobile may choose to have the primary control of the defense of any claim under this Section, but may not take any steps that would cause Danger to admit liability or affect Danger’s rights in any legal action without Danger’s prior written consent. At all times, Danger may participate in the defense using its own legal counsel, and at its own expense. T-Mobile may not settle any claim or action on Danger’s behalf without first obtaining Danger’s written permission, which permission will not be unreasonably withheld. T-Mobile will make any payments required of it under this Section 17.4 on Danger’s demand. Following Danger’s request for indemnification, T-Mobile will not disclose such settlement and its terms to any third party, directly or indirectly, without Danger’s prior, written permission or an order from a court of competent jurisdiction; provided however, T-Mobile may provide such information to its auditors, attorneys, investors and financial advisors that are bound in writing to keep information of this nature confidential.

17.5 Notwithstanding the foregoing, neither party shall indemnify the other for third party claims to the extent to which an end user is found liable for his/her intentionally harmful or negligent use of the Danger Device, Danger Software, Danger Service, the T-Mobile Software, or a T-Mobile Service.

17.6 Notwithstanding anything in this Agreement, in no event will Danger be required to indemnify or compensate T-Mobile or any Indemnified Party for liabilities for which T-Mobile or any Indemnified Party has received full indemnification or compensation from a Manufacturer.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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18. INFRINGEMENT REMEDY. If the Danger Services or the Danger Software (or any portion thereof), are held or reasonably determined (by Danger) to constitute an infringement and any use as contemplated by this Agreement is enjoined or imminently likely to be enjoined, Danger will notify T-Mobile and immediately, at Danger’s expense either: (i) procure for T-Mobile and its Subscribers the right to continued use as contemplated by this Agreement of the affected Danger Services or Danger Software (or portion thereof); or (ii) provide T-Mobile with a replacement or modified version of the affected Danger Services or Danger Software (or portion thereof) that is non-infringing, provided that the replacement or modified version meets the applicable specification and is provided to T-Mobile in its entirety and in advance of distribution sufficient to allow T-Mobile to evaluate and approve the substitution. If (i) or (ii) are undertaken by Danger, then the foregoing states Danger’s entire liability and T-Mobile’s exclusive remedy for Danger’s breach of its warranty of Section 15.2(d). If (i) or (ii) are not available despite Danger’s commercially reasonable efforts, then T-Mobile will have the right to terminate this Agreement and T-Mobile may exercise any of its rights and remedies as set forth in this Agreement, at law or in equity. Nothing in this Section is to be interpreted to waive any of T-Mobile’s rights or Danger’s obligations under T-Mobile’s right to indemnification resulting from third party claims.

19. INSURANCE REQUIREMENTS

19.1 At its sole expense, Danger shall carry and maintain throughout the term of this Agreement all insurance described below. All deductibles and premiums are the responsibility of Danger. The policies described below shall be primary and not contributory with any coverage maintained by T-Mobile. The policies shall include T-Mobile USA, Inc. as an additional insured, but T-Mobile will not be included as an additional insured for its own negligence. The policies shall contain a severability of interests provision. The form of the insurance shall at all times be subject to T-Mobile’s reasonable approval, and the carrier or carriers must have an A.M. Best rating of A-, VIII or higher. The liability policies must each contain a provision by which the insurer agrees that such policy shall not be canceled except after thirty (30) days written notice to T-Mobile.

19.2 Danger shall maintain the following lines of coverage pursuant to this Section 19: Danger will carry Commercial General Liability (Occurrence Form) with a minimum combined single limit for bodily injury and property damage of [ * ] per occurrence, including coverage for personal/ advertising injury and contractual liability. The above coverage may be provided by any combination of primary or excess insurance policies in Danger’s reasonable discretion.

20. TERM AND TERMINATION

20.1 Term. This Agreement is effective as of the Effective Date, and will continue in effect until December 31, 2008, unless terminated earlier as provided in Section 20.3 below (the “Initial Term”). For purposes of this Agreement the “Term” will consist of the Initial Term and the Renewal Term (if any) (as set forth in Section 20.2) (collectively the “Term”).

20.2 Renewal. Unless either party gives the other written notice of its intent not to renew this Agreement at lease one hundred eighty (180) days prior to the end of the Initial Term, T-Mobile has the right to renew this Agreement for a single additional period of up to three (3) year(s) (the “Renewal Term”).

20.3 Termination.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(a) Immediate Termination. T-Mobile may terminate this Agreement immediately upon notice to Danger if Danger is in breach of Section 14.2(b) or (c) of this Agreement.

(b) Termination for Breach.

(i) Either party may terminate this Agreement upon not less than thirty (30) days prior written notice to the other of any material breach of the terms of this Agreement (including, without limitation, the Service Level Agreement), provided that such other party has not cured such material breach within such thirty (30) day notice period.

(ii) Notwithstanding the above, in the event that Danger and T-Mobile have bona fide dispute regarding the proper billing or payment for Danger Services, Danger may not terminate or suspend performance of this Agreement until the parties have completed the required expedited arbitration procedure, as set forth in Section 23.3.

(c) Effect of Termination. Upon any termination or expiration of the Term for any reason, all rights and obligations of the parties under this Agreement shall be extinguished, except that: (a) all accrued payment obligations hereunder shall survive such termination or expiration; and (b) the rights and obligations of the parties under Section 20.4 shall survive in accordance with their terms. If prior to any termination or expiration of this Agreement, a Release Condition has occurred under Section 13.2, and T-Mobile has asserted its rights to the Software, Section 13 shall also survive. Upon any termination or expiration of this Agreement, except for non-payment of undisputed amounts, Danger will provide T-Mobile with transition support to facilitate the orderly completion of the Danger Services and the transition of Subscribers to T-Mobile or any third party service provider designated by T-Mobile, including, without limitation by providing T-Mobile with any and all Subscriber Data or other necessary information. If termination of this Agreement is due to a breach by T-Mobile or by expiration, then all such transition costs will be at T-Mobile’s expense. If termination of this Agreement is the result of Danger’s breach, then such transition costs will be at Danger’s expense.

20.4 Survival. Any rights to accrued payments, any right of action for breach of the Agreement prior to termination, and the following sections survive any termination or expiration of this Agreement: 1, 2, 10.5, 10.6, 10.7, 10.8, 10.9, 12.2, 12.3, 12.4, 13.3, 14.1, 14.2, 14.3, 14.5, 14.6, 15.5, 16, 17, 18, 20.3(c), 20.4 and 23.

21. CHANGE OF CONTROL; ASSIGNMENT.

21.1 Change of Control. Danger will provide T-Mobile with a right of first refusal on the sale of a controlling interest of Danger to a US Operator on substantially similar terms and conditions, including equivalent pricing and timing as that of the competitive offer. This right ends upon the successful completion of an initial public offering of Danger stock. In the event a controlling interest in Danger is acquired by a US Operator, Danger and its successor(s) must continue to provide the Danger Service in accordance with the terms and conditions of this Agreement.

21.2 Assignment. Danger may not assign its rights nor delegate its obligations under this Agreement without the prior written consent of T-Mobile, which such consent may not be unreasonably withheld or denied. However, the assignment of this Agreement to a US Operator shall require T-Mobile’s prior written consent and T-Mobile has the right to deny consent for any or no reason, provided that such written denial of consent is received by Danger within fifteen (15) days of the request for consent. Any attempted assignment or delegation not in accordance with this Section will be void and of no force or effect. T-Mobile may assign this Agreement to any T-Mobile-Related Company, provided that T-Mobile

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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shall remain liable for any obligations by such T-Mobile-Related Company, and provided that T-Mobile may not assign this Agreement to a Cousin Company without the advanced written consent of Danger, which consent shall not be unreasonably denied. This Agreement is binding upon the heirs, executors, administrators, successors and permitted assigns of the Parties, including, without limitation, those arising from merger, consolidation, sale of assets or otherwise, if not otherwise prohibited by this Agreement.

22. NOTICES. All notices and other communications required by this Agreement must be in writing and will be deemed to have been duly given and effective (i) upon receipt if delivered in person or via facsimile (with proof of proper transmission), (ii) one day after deposit prepaid with a national overnight express delivery service, or (iii) three days after deposit in the United States mail (registered or certified mail, postage prepaid, return receipt requested). All notices must be sent to the following people:

T-Mobile
Robert Dotson President and Chief Executive Officer T-Mobile USA, Inc. 12920 SE 38th Street
Bellevue, WA 98006
Facsimile: [ * ]
with copies to:
David A. Miller	Cole Brodman
General Counsel	Senior Vice President and Chief Development Officer
T-Mobile USA, Inc.	T-Mobile USA, Inc.
12920 SE 38th Street	12920 SE 38th Street
Bellevue, WA 98006	Bellevue, WA. 98006
Facsimile: [ * ]	Facsimile: [ * ]
Danger		with copies to
Henry R. Nothhaft		Scott Darling
Chief Executive Officer		General Counsel
Danger, Inc.		Danger, Inc.
3101 Park Blvd.		3101 Park Blvd.
Palo Alto, CA 94306		Palo Alto, CA 94306
Facsimile: (650) 289-5001		Facsimile: (650) 289-5001

23. GENERAL TERMS

23.1 Relationship of the Parties. Danger has no right, power, or authority to make any representations or warranties regarding the telecommunications service or the services provided by T-Mobile hereunder except as expressly directed in writing and in advance by T-Mobile. The Parties will act solely as independent contractors to each other in performing this Agreement, and nothing herein will be construed at any time to create the relationship of employer and employee, partnership, or joint venture between T-Mobile and Danger, or between T-Mobile’s and Danger’s officers, directors, employees, or agents. Danger and its employees, agents, and subcontractors have no right or authority to act for T-Mobile, and may not attempt to enter into any contract, commitment, or agreement, or incur any debt or liability, of any nature, in the name of or on behalf of T-Mobile.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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23.2 Governing Law; Venue. This Agreement and the rights and obligations of the Parties hereunder are to be construed and enforced in accordance with and governed by the laws of the State of Washington, without regard to conflict of law or choice of law principles and notwithstanding the location of Danger’s manufacturing or other facilities, the Delivery Location, or the location of the Parties. Danger and T-Mobile hereby submit to exclusive venue, and personal and subject matter jurisdiction of any state or federal court sitting in King County, Washington.

23.3 Expedited Arbitration. The parties will act in good faith and use commercially reasonable efforts to promptly resolve any bona fide disputes under this Agreement (each a “Dispute”) between the parties or any of their respective subsidiaries, affiliates, successors or assigns under or related to this Agreement. Except for claims for injunctive relief, or any breach of Sections 12.2, 12.3, 12.4, 12.5, 12.6, 13.3 or 14, such Disputes will be governed exclusively and finally by expedited arbitration. Such arbitration will be conducted by the American Arbitration Association (“AAA”) in Seattle, Washington, will be initiated and conducted in accordance with the Commercial Arbitration Rules of the AAA, as such rules are in effect on the date of delivery of a demand for arbitration, except to the extent that such rules are inconsistent with the provisions set forth herein, and such expedited arbitration shall be concluded within sixty (60) days of the demand for arbitration. The arbitrator will have the non-exclusive power to issue an injunction or require specific performance as he or she finds necessary. The arbitrator must have significant experience in commercial litigation and the technology and telecommunications industries. Each party will use its best efforts to expedite selection of an arbitrator and will reply to any request to select an arbitrator within five (5) days. Should arbitration result in a monetary award to either party, the party owing the award shall have ten (10) days to pay such an award, or the other party may thereafter terminate this Agreement immediately for failure to provide payment of the arbitration award.

23.4 Interpretation. The headings, subheadings, and other captions in this Agreement are for convenience and reference only and will not be used in interpreting, construing, or enforcing any of the terms of this Agreement. Each party acknowledges that it has had the opportunity to review this Agreement with legal counsel of its choice, and there will be no presumption that ambiguities will be construed or interpreted against the drafter, and no presumptions made or inferences drawn because of the inclusion of a term not contained in a prior draft or the deletion of a term contained in a prior draft.

23.5 Attorneys’ Fees. If any Party to this Agreement commences litigation to enforce or construe any provision of this Agreement, the prevailing party is, in addition to other remedies, entitled to recover its reasonable attorneys’ fees and costs in such litigation and any appeal therefrom.

23.6 Force Majeure. Neither party will be in default of or have breached any provision of this Agreement as a result of any delay, failure in performance or interruption of service, resulting directly or indirectly from third party labor disputes, the bankruptcy of third parties, acts of God, including earthquakes, acts of war, terrorism, lightning, or fire, and also including any disruption or unavailability of communications, utility, or Internet services caused by such acts of God. In the event of such a force majeure event that continues for at least [ * ], then either party may terminate this Agreement upon written notice to the other party.

23.7 Waiver. Any waiver by either Party of any breach of a term or provision of this Agreement must be in writing and will not be construed as a waiver of any subsequent breach of such term or provision or of any other term or provision. No delay or omission in the exercise of any power, remedy or right herein provided or otherwise available to a Party will impair or affect the right of such Party thereafter to exercise the same. Any extension of time or other indulgence granted to another Party hereunder does not otherwise alter or affect any power, remedy or right of any other Party; or the obligations of the Party to whom such extension or indulgence is granted.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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23.8 Severability. In the event any provision of this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, the remaining provisions shall remain in full force and effect. If any provision of this Agreement shall, for any reason, be determined by a court of competent jurisdiction to be excessively broad or unreasonable as to scope or subject, such provision shall be enforced to the extent necessary to be reasonable under the circumstances and consistent with applicable law while reflecting as closely as possible the intent of the parties as expressed herein.

23.9 Entire Agreement. This Agreement together with the Exhibits attached hereto, including, the Device Supply Terms and Conditions, Service Level Agreement, and Escrow Agreement contains the entire understanding of the parties with respect to the transactions and matters contemplated herein, supersedes all previous agreements or negotiations between Danger and T-Mobile concerning the subject matter hereof, and cannot be amended except by a writing dated subsequent to this Agreement and signed by both parties. No course of dealing or usage of trade may be invoked to modify the terms and conditions of this Agreement.

23.10 Amendment. This Agreement may not be amended, modified or supplemented except by a writing executed by both Parties.

23.11 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original, and all of which together constitute one and the same instrument.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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IN WITNESS WHEREOF, the parties have duly executed and delivered this Agreement as of the Effective Date.

T-Mobile USA, Inc. (“T-Mobile”)		Danger, Inc. (“Danger”)
By	/s/ Cole J. Brodman	By	/s/ Henry R. Nothhaft
	(signature)		(signature)
Name	Cole J. Brodman	Name	Henry R. Nothhaft
Title	Sr. Vice President Product Development	Title	Chairman & CEO
Date	March 22, 2006	Date

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT A: SPECIFICATION FOR DANGER SOFTWARE AND BASIC SERVICES V.2.3

[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT B: SERVICE LEVEL AGREEMENT

This Exhibit B describes the service levels, escalation procedures, and non-performance remedies associated with Danger’s provision of the Danger Service required under this Agreement.

1. Definitions.

1.1 “Outage” means a service interruption that affects a majority of users utilizing that service at the time of occurrence. Service interruptions occurring during Scheduled Maintenance Windows or caused by a failure of a T-Mobile system or service are not Outages and will not be counted in the calculation of Service Threshold. In addition, service interruptions attributable to third party website or instant messaging providers are not Outages and will not be counted in the calculation of Service Threshold.

1.2 “Incident” means an Outage or Degradation or potential Outage or Degradation that is reported by T-Mobile or that is identified by Danger, or any other error or service disruption related to the Danger Service.

1.3 “Measurement Period” shall mean a calendar month.

1.4 “Scheduled Maintenance Window” is defined in Section 3.

1.5 “Degradation” means a decrease in the email, web browsing, or IM service as service is measured in Section 6 of this Exhibit B.

1.6 “Severe Degradation” means degradation of the email, web browsing, or IM service as measured in Section 6.6 of this Exhibit B.

2. Escalation Procedures.

2.1 Escalation Process; Dispute Resolution. T-Mobile and Danger shall maintain an escalation process and contact information as described herein to aid in resolving any Incidents, and shall routinely update and exchange contact information as changes warrant. In the event the contact individuals for the relevant Service offering are unable to resolve an Incident or issue relating to level of service, the performance of systems, or level of cooperation within the times specified herein, then T-Mobile or Danger may require a meeting or conference call between the contact individuals listed at the next higher contact level. Each party agrees to negotiate in good faith towards the resolution of such Incident or issue. If the Incident or issue is not resolved within five (5) calendar days, then T-Mobile or Danger may require an immediate meeting or conference call between appropriate Senior Management within each company.

2.2 Notice of Incident. T-Mobile shall notify Danger promptly of any Severity 1, 2 or 3 Incident related to the Danger Systems or Danger Services, or in the event that Danger first detects such an Incident, Danger will promptly notify T-Mobile of the same. Any such notice shall specify the Danger Services that are impacted and include reasonable detail about the Incident as is available to the party providing the notice. Severity levels and Incident handling procedures are described in Table I below. Danger shall use reasonable efforts to provide a Final Resolution or Work Around, subject to T-Mobile’s approval, within the time periods specified in the Escalation Table below. T-Mobile shall use commercially reasonable efforts to notify Danger of any known issues related to T-Mobile’s or T-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Mobile’s service providers’ systems and services required to deliver the Danger Services that affect the delivery of Danger Services.

2.3 Incident Handling. Danger will be responsible for coordinating all Incident isolation, testing and repair work for Danger’s systems and Danger Services. Severity levels will be determined and communicated to Danger by T-Mobile according to the escalation tables below.

2.4 Communication. During the Incident isolation and resolution process, Danger will communicate Incident resolution progress with the appropriate T-Mobile contact and escalate the Incident resolution efforts based upon the times specified in the Escalation Table. In addition, Danger shall notify T-Mobile in writing if it is necessary to purposely disable any Danger Services, (such as email, PDM, the Desktop interface, or web browsing).

2.5 Incident Reporting. During the Incident isolation and resolution process Danger will provide status updates in accordance with the time schedules set forth in the Escalation Table below, which will include the following information:

(a) Trouble Ticket Number

(b) Event Description

(c) Specific Danger Service(s) affected (including if a portion of a Danger Service is affected).

(d) Number of T-Mobile Subscribers affected

(e) Percentage of T-Mobile Subscribers affected

(f) Start Date/Time of Incident.

(g) Initial Notification Time

(h) Current Status of Repair.

(i) Estimated time of repair.

Escalation Table

Severity	Description	Initial Notification	Status Update Intervals until Resolution	Expected Resolution Times
Level 1	Means an error in the DANGER Services or product that: •        affects any subset of T-Mobile Customers;	[ * ]	[ * ]	[ * ]
	•        an important component of the DANGER Services to be

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Severity	Description	Initial Notification	Status Update Intervals until Resolution	Expected Resolution Times
	unusable, or (ii) a system or product malfunction, or (iii) data loss or corruption, and has frequent or major Customer impact or there is a frequent failure or disabling of an important service.
Level 2	Means an error in the DANGER Services or product that: •        constitutes a major failure or disabling for an important DANGER Services feature that causes significant inconvenience to Subscribers, system or product malfunction; or results in Services or usage materially different from those specified to T-Mobile or Customers; or adversely affects T-Mobile operations or systems; but which error does not rise to the level of a Severity 1 error.	[ * ]	[ * ]	[ * ]
Level 3	Means an error in the DANGER Services or product that •        impacts T-Mobile operations or systems, but not considered to severely impact Customer experience.	[ * ]	[ * ]	[ * ]

2.6 Customer Message. In the event of a Severity Level 1 or 2 Incident, Danger will, at its own expense, post and maintain a “site down,” “feature down,” or similar online status notice on the Danger/T-Mobile portal website in a manner reasonably intended to inform all Subscribers of the status of the Danger Services and when the Danger Services are likely to be fully restored. Danger and T-Mobile shall mutually agree on the communication viewed by or sent to the Customer.

2.7 Work Arounds. In the event that a Work Around is approved by T-Mobile for a Severity 1 or Severity 2 Incident, then the level of severity for that Incident may be downgraded by T-Mobile in its discretion to a Severity 3 Incident until such time as a Final Solution is provided by Danger.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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2.8 “Post Mortem” Report. Within [ * ] business days following Danger’s resolution of an Outage, Danger shall provide T-Mobile with a written “Post Mortem Report’ of the particular event. The Post Mortem Report shall include the following information:

(a) Trouble Ticket Number

(b) Event Description

(c) Specific Danger Service(s) affected (including if a portion of a Danger Service is affected).

(d) Number of T-Mobile Subscribers affected

(e) Percentage of T-Mobile Subscribers affected

(f) Start Date/Time of Incident.

(g) Initial Notification Time

(h) Resolution Date/Time

(i) Total Outage Time

(j) Necessary Follow-Up Activities.

2.9 Outage/Incident Reporting. On a monthly basis, within thirty (30) days of the end of the month, Danger will report for the prior thirty (30) day period: the number of trouble tickets generated, the number of Outages, Degradations, and Incidents, the length of the Outage, Degradation, or Incident, the Severity Level for each ticket, the date service availability was restored, and the time to close the trouble ticket. T-Mobile shall have the right to audit Danger’s Outage, Degradation, and Incident records and data upon prior written notice and, if errors or discrepancies in Danger’s reporting are found, Danger shall correct its reporting.

3. System Maintenance. Scheduled Maintenance Windows will be (i) [ * ] unless otherwise agreed and (ii) other times as permitted with T-Mobile’s prior written approval. T-Mobile and Danger will work to resolve and maintenance window conflicts where both parties are performing work on the same night. Danger will use the Saturday night maintenance window for customer impacting maintenances on an infrequent basis. In the event emergency maintenance is required outside of a Schedule Maintenance Window, Danger will use reasonable efforts to provide twenty-four (24) hours advance notice, subject to mutual agreement as to scheduling, unless the parties mutually agree otherwise.

4. Contacts

4.1 T-Mobile Contacts: The following T-Mobile personnel should be contacted in the event of Incidents, or after T-Mobile has designated a level of severity.

First NOC [ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Second	[ * ], office: [ * ], mobile: [ * ]
Third	[ * ] hours after second contact if the Incident is not resolved: [ * ] office: [ * ] mobile: [ * ]

4.2 Danger Contacts: The following Danger personnel should be contacted in the event of Incidents, or after T-Mobile has designated a level of severity.

First	NOC [ * ]
Second	[ * ]
Third	[ * ]

5. Danger Service Availability, Metrics and Credits.

5.1 Outage Measurement. An Outage for Danger Service availability will be measured from the time Danger receives notice of such Outage or Danger recognizes the Outage, whichever occurs first, until all Danger Services are restored.

5.2 Danger Service Availability. The Service Threshold for the availability of the Danger Service shall not fall below [ * ]% as calculated monthly. Compliance with the Service Threshold will be measured based on a calendar month Measurement Periods. The Service Threshold percentage will be calculated by dividing the total number of minutes of Outages during an applicable month by the total number of actual minutes (excluding the minutes within the Scheduled Maintenance Windows) in such month, and then subtracting the resulting number from 1 and multiplying that amount by 100; i.e., a calculation using the following formula: 1- (total Outage minutes in a month/total minutes in said month) x 100. Outages caused by technical problems within T-Mobile’s network or that are outside of Danger control (each an “External Problem”) shall be excluded from the calculation for the duration of the External Problem. In addition, Danger’s restoration time from such External Problems shall be excluded from the calculation in accordance with the following formula: (i) for External Problems that are [ * ], then the restoration time not considered an “Outage” will be equal to [ * ] the time of the External Problem (e.g., if T-Mobile’s network caused a [ * ], then restoration time of [ * ] would not be considered an “Outage”), (ii) for External Problems that are greater than [ * ], then the restoration time not considered an “Outage” will be [ * ], plus an amount of additional time equal to [ * ] (e.g., if T-Mobile’s network was down for [ * ], then the restoration time would be [ * ])). If the Service Threshold falls below [ * ]% during a Measurement Period, T-Mobile will be entitled to a prospective credit from Danger towards Service Fees. The credit will be calculated as follows: [ * ]. If the Service Threshold falls below [ * ]% during a Measurement Period, T-Mobile will be entitled to a credit from Danger of [ * ]% of the Service Fees paid or payable by T-Mobile for the Measurement Period. The service credits set forth above shall constitute T-Mobile’s sole and exclusive monetary remedy for Danger’s failure to maintain the Service Threshold. T-Mobile shall be permitted to withhold payments in the amounts equal to the credits due under this Section 5.2 from amounts owed to Danger for Service Fees. Danger shall issue credit memos for Outages to T-Mobile within ten (10) business days from the end of each calendar month in which a credit was earned.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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6. Application Specific Performance KPIs. The parties have set forth below key performance indicators (“Key Performance Indicators” or “KPIs”) for performance of e-mail, web browsing delivery and instant messaging services. Until such time that real-time network performance can be determined, the Service-Based KPIs will be used to determine Degradations. For all KPIs, the Degradation and Severe Degradation calculations as determined below will not include degradations caused by technical problems within T-Mobile’s network or that are outside of Danger control (each an “External Degradations”) for the duration of the External Degradation. In addition, Danger’s restoration time from such External Degradation shall be excluded from the calculation in accordance with the following formula: (i) for External Degradations that are [ * ], then the restoration time not considered an “Outage” will be equal to [ * ] the time of the External Degradation (e.g., if T-Mobile’s network caused a degradation for [ * ], then restoration time of [ * ] would not be considered a “Degradation”), (ii) for degradations outside of Danger’s control that are greater than [ * ], then the restoration time not considered a “Degradation” will be [ * ], plus an amount of additional time equal to [ * ] (e.g., if T-Mobile’s network was down/degraded for [ * ], then the restoration time would be [ * ])).

6.1 KPI Tools.

(a) Device-Based KPI Tool. Danger has developed a device-based KPI tool for end-to-end, round trip performance measurements of e-mail and Web browsing. T-Mobile has two (2) such devices in its possession, and by March 1, 2006 Danger shall load such tools onto four (4) additional Danger Devices provided by T-Mobile. These tools will be used by T-Mobile to self-monitor the performance of the end-to-end customer experience of the Danger Service. Although it can and should be used to help determine the source of potential issues, information and data collected from this tool will not be used as a measurement against the agreed upon Service Level Metrics or credits because it measures T-Mobile data network and the Internet which are elements outside of Danger’s control.

(b) Service-Based KPI Tool. Danger has developed and is testing a service-based KPI tool for measurements of e-mail and web browsing performance within the Danger Service (the “Service-Based KPI Tool”). This tool collects data utilizing a server which is placed on the edge of Danger’s network. For email performance the service-based KPI tool will send and receive test messages at regular intervals. For web browsing performance the tool requests and retrieves copies of web pages that are located within Danger facilities. The e-mail messages and web traffic will traverse the same path as is traversed by Subscribers, within the Danger Service. Danger shall report results from the Service-Based KPI Tool monthly, beginning with the month-end report for March 2006. Unless otherwise agreed by the parties, the Service-Based KPI Tool reports will be the basis of the Service Level Metrics and credit calculations.

6.2 Email.

E-Mail reliability metrics shall have a fixed target of [ * ]% delivery of email content within a [ * ] [ * ] time period, with credits to apply if less than [ * ]% of emails are delivered within [ * ] [ * ]. Metrics for purposes of calculating credits shall be based on tests that measure @tmail.com email performance. For reliability of less than [ * ]% during a Measurement Period, the prospective credit shall be a percentage of the Service Fees paid by T-Mobile for the Measurement Period, as set forth in the table below. The parties acknowledge the email technology may be subject to further changes in the future, and that new performance metrics may be appropriate if new technology is introduced (e.g. spam filtering). The parties will agree whether existing metrics should be changed, or not, at such time.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Delivery Measurement	% of Service Fees Credit
[ * ]% – [ * ]%	[ * ]% of Service Fees
[ * ]% – [ * ]%	[ * ]% of Service Fees
[ * ]% – [ * ]%	[ * ]% of Service Fees
[ * ]% – [ * ]%	[ * ]% of Service Fees
[ * ]% and below	[ * ]% of Service Fees

6.3 Web Proxy.

(a) Web proxy error rates should not exceed [ * ]% overall for the month. For web proxy error rates exceeding [ * ]% for the Measurement Period, during a Measurement Period, the prospective credit shall be a percentage of the Service Fees paid by T-Mobile for the Measurement Period, as set forth in the table below. Danger shall report its results monthly. Error information will come from real customer data from the Danger Service.

Error Rate Measurement	% of Service Fees Credit
[ * ]% – [ * ]%	[ * ]% of Service Fees
[ * ]% – [ * ]%	[ * ]% of Service Fees
[ * ]% – [ * ]%	[ * ]% of Service Fees
[ * ]% – [ * ]%	[ * ]% of Service Fees
[ * ]% and above	[ * ]% of Service Fees

(b) Following the evaluation of round-trip web page retrieval times, Danger will use reasonable efforts to correct any deficiencies found and the parties will agree on similarly-structured metrics for the retrieval of one or more sample web pages. Danger shall report its results monthly but also must provide T-Mobile real-time access to the data collection tool or read-only access to the measured results via a dashboard or other real-time means. It is anticipated that a copy of [ * ] shall be one of the sites, and that another site will also be chosen, possibly [ * ] or some other popular site. It is acknowledged that times for some web sites are expected to increase with the new browser, because the new browser will read JavaScript pages, where the old browser did not. The new browser is expected to deliver at least statistically similar performance to the old browser for non-JavaScript sites like [ * ], if not improved performance.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(c) The parties acknowledge the browser technology may be subject to further changes in the future, and that new performance metrics may be appropriate if new technology is introduced. The parties will agree whether existing metrics should be changed, or not, at such time.

6.4 Instant Messaging. The parties will work together to develop KPI measurement tools for instant messaging services, taking into account the third party services involved.

6.5 Maximum Credits. Except as set forth in this Section or Section 6.6, in no instance shall the total credits from all Application Specific KPIs exceed [ * ]% of Service Fees (no more than [ * ]% per Application) in any given Measurement Period. Provided that the calculated Application specific credits under this Section 6 are not greater than the Danger Service Outage credits under Section 5, the application specific KPI credits will not be available if Danger Service Outage credits under Section 5 are invoked, or if Application Severe Degradation credits are earned, as described in Section 6.6. The parties agree to update Application specific metrics in accordance with improvements that may be driven through customer complaints or other T-Mobile observations, in the event that these complaints/observations reveal an area of degraded service that is not currently measured by already agreed Key Performance Indices. T-Mobile reserves the right to seek reasonable credits for customer impacting service outages or service degradation that are not expressly described herein of up to [ * ]% of Service Fees paid by T-Mobile for a Measurement Period. T-Mobile may not, however, withhold payment in advance of gaining agreement with Danger that such credits are reasonable and appropriate. The Service Fee credits set forth in this Section 6 shall constitute T-Mobile’s sole and exclusive monetary remedy for Application-specific Degradations and Severe Degradations and Danger’s failure to maintain the application specific KPIs. T-Mobile shall be permitted to withhold payments in the amounts equal to the credits due under Section 6 from amounts owed to Danger for Service Fees. Danger shall issue credit memos for Application-Specific Degradations and/or Severe Degradations to T-Mobile within ten (10) business days from the end of each calendar month in which a credit was earned.

6.6 Application Specific Severe Degradation. If there is Severe Degradation (as defined below) of email, web browsing, or instant messaging (each an “Application”), then T-Mobile shall be entitled to a credit of [ * ]% of Service Fees paid by T-Mobile for the day on which the Severe Degradation occurred, for each Application that is Severely Degraded. Under no circumstances will T-Mobile be entitled to a credit larger than [ * ] percent ([ * ]%) of the Service Fees per day for Severe Degradations.

(a) Email Application Severe Degradation. The Email Application will be considered to be Severely Degraded for a day if [ * ] or more of the test results from the Device-Based KPI Tools and Service-Based KPI Tools for that day show a failure to complete email delivery within [ * ] [ * ].

(b) Web Browsing Application Severe Degradation. The Web Browsing Application will be considered to be Severely Degraded if there is an error rate of [ * ]% or more attempt failures within [ * ].

(c) IM Application Severe Degradation. The IM Application will be considered to be Severely Degraded for [ * ] if [ * ] of the test results from Device-based KPI or Service-based KPI Tools for that [ * ] [ * ], and such failure is not the cause of a third party IM service provider or T-Mobile.

6.7 Pro-Rata Metrics. The parties shall also see to establish metrics to measure Outages as a percentage of customer hours, with corresponding refunds/credits of service fees for the month. The effected customers, as a % of total base, will be used to pro-rata service fees. For example: email outage for [ * ] customers = [ * ].

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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6.8 Audit Rights for Application Specific Measurements. T-Mobile may, pursuant to its audit rights in Section 10.8 of the Agreement, audit Danger’s measurements and collection practices for the KPIs described in this Section 6. Notwithstanding Section 10.8, if T-Mobile conducts an audit solely on the measurement and collection practices issue, such audit will not count against the annual number of audits permitted under Section 10.8. But T-Mobile may only conduct a measurements and collection practices audit one time per year unless an audit indicates inaccurate reporting, in which case, T-Mobile may conduct an additional audit. The Audit report and results shall be subject to a confidentiality agreement provided by Danger. If Danger refuses to make its data or facilities available to an audit under this Section 6.8, then such time during which Danger refuses to allow an audit will be [ * ].

6.9 System Architecture Design.

(a) Chief Architect. Within ninety (90) days of signing this Agreement, Danger will hire a Chief Architect who will be responsible for the design and scalability of the Danger Services.

(b) Third Party Consultant – System Architecture. Danger will, at its cost, identify and hire a third party consultant(s) that will (i) review Danger’s existing network infrastructure, (ii) evaluate issues regarding the scalability, stress-testing, service level diagnostics, disaster recovery, and security of the infrastructure, and (iii) provide recommendations regarding modifications or additions to the infrastructure to improve any of the foregoing issues (the “System Architecture Review”). Danger will identify the consultants and provide information regarding their background to T-Mobile. If T-Mobile objects in good faith to the consultant, T-Mobile must support the objection with an articulable basis that disputes the consultant’s objectivity or competence to conduct such review. If such an objection is raised, then that consultant will not be used for the System Architecture Review, and Danger and/or T-Mobile will identify a new proposed consultant subject to the objection process in this section. T-Mobile will have full access to a meaningful and detailed executive summary report provided by the consultant(s) regarding all of the foregoing issues. If T-Mobile requests additional detail regarding the System Architecture Review, then Danger will provide such detail, with such detail not to be unreasonably withheld. At T-Mobile’s request, T-Mobile may request that the full System Architecture Review be reviewed by a third party, who must be reasonably approved by Danger, for the purpose of confirming that the summary provided to T-Mobile is an accurate summary of the System Architecture Review. Such third party will be required to sign a confidentiality agreement with Danger. Such report shall be subject to a confidentiality agreement provided by Danger, similar to the Security Information Confidentiality Agreement between dated July 1, 2005, but T-Mobile may identify different individuals at T-Mobile that may review the report other than those contained in the Security Information Confidentiality Agreement.

(c) Implementation of System Architecture Design. Danger will complete a system architecture revision plan by July 14, 2006 aimed at supporting [ * ] T-Mobile Subscribers by January 1, 2007 and [ * ] T-Mobile Subscribers by January 1, 2008. The parties shall meet for a joint architectural and capacity review before July 31, 2006, and hold periodic reviews twice per calendar year thereafter (more frequently if necessary). Such reviews would include T-Mobile systems and capacity planning information. Danger’s architecture plan and reviews shall be subject to the confidentiality agreement described in 6.9(b) above.

6.10 Enhanced Monitoring and Reporting. Within 16 months of the date of signing this Agreement, Danger will have substantially implemented, in the full production environment, and in a manner that has been accepted by T-Mobile (such acceptance not to be unreasonably withheld), the service level diagnostics and reporting guided by the minimum requirements set forth in Schedule 1 hereto (“Monitoring Enhancements”). At all times, Danger will keep T-Mobile informed about the Monitoring

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Enhancements and the schedule of implementations made by Danger. If Danger has not implemented the Monitoring Enhancements within 16 months of the signing of this Agreement, then the monthly Service Fees will be reduced $[ * ] per subscriber until such Monitoring Enhancements are implemented.

6.11 No Double Dipping. For any given series of events (e.g., Degradation or Outages), during a calendar month, T-Mobile may only choose to invoke Service Fee credits for one of the following issues: (i) Danger Service Outages under Section 5.2; (ii) Application Degradations under Sections 6.2, 6.3 and/or 6.4; or (iii) Application Severe Degradation under Section 6.6, but in no event will the Service Fee credits exceed the monthly service fees for that month.

7. Interconnection for Data

7.1 Equipment. Danger will provide physical servers, switches, routers, and other equipment and infrastructure suitable to host and support the services required in this Agreement.

7.2 Network Connectivity and Service Levels. Danger is responsible for network connectivity from T-Mobile’s [ * ] and such other points of interconnection to each Danger data center including IP backbone carriers. Such network connectivity shall encompass fully redundant and diverse dedicated connections to the Internet, each with minimum bandwidth capacity of [ * ] burstable up to [ * ]; provided, that when such dedicated connections reach [ * ]% of capacity, then Danger shall arrange to upgrade capacity in order to alleviate such condition. The parties acknowledge that T-Mobile’s cooperation is required to add capacity and/or to facilitate repairs in a timely manner so that network connectivity capacity may be maintained in accordance with this Section 7. Therefore, Danger shall not be liable for the credits set forth herein, if T-Mobile fails to cooperate or delays its assistance for Danger to properly manage network connectivity capacity.

7.3 Credits: In the event usage via dedicated connections to the network reaches a daily average of between [ * ]% - [ * ]% of network connectivity capacity for [ * ], T-Mobile will be entitled to receive prospective credits equal to [ * ]% of the Service Fees paid by T-Mobile for the applicable period. In the event usage via dedicated connections to the network reaches a daily average of between [ * ]% - [ * ]% of network connectivity capacity for [ * ], T-Mobile will be entitled to receive credits equal to [ * ]% of the Service Fees paid by T-Mobile for the applicable period. In the event usage via dedicated connections to the network reaches a daily average of between [ * ]% - and [ * ]% of network connectivity capacity for [ * ], T-Mobile will be entitled to receive credits equal to [ * ]% of the Service Fees paid by T-Mobile for the applicable period. In the event usage via dedicated connections to the network exceeds a daily average of [ * ]% of network connectivity capacity for [ * ], T-Mobile will be entitled to receive credits equal to [ * ]% of the Service Fees paid by T-Mobile for the applicable period. The parties acknowledge and agree that the damages that T-Mobile will incur in the event Danger fails to monitor and expand network connectivity capacity as may be required from time to time are extremely difficult to calculate, that the credits described herein are a reasonable estimate of T-Mobile’s damages in such event, and that the credits described herein are in addition to any other damages or refunds that may become due and owing under the terms of this Exhibit B. T-Mobile shall be permitted to withhold payments in the amounts equal to the credits due under this Section 7.3 from amounts owed to Danger for Service Fees. Danger shall issue credit memos for credits earned under this Section 7.3 to T-Mobile within ten (10) business days from the end of each calendar month in which a credit was earned.

7.4 Maintenance and Upgrade of Danger’s Network. If any maintenance needs to be performed on Danger’s network, it will be scheduled and coordinated with T-Mobile. Danger will notify T-Mobile via e-mail of scheduled Outages not less than 72 hours in advance. If an Outage is to be more than two (2) hours in duration, then T-Mobile will be notified at least five (5) business days in advance. Danger will

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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maintain internal controls for notification immediately in the event of any unscheduled network/system interruptions. In the event emergency maintenance is required, Danger will use reasonable efforts provide twenty-four (24) hours advance notice.

S

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Schedule 1 To SLA: Enhanced Monitoring And Reporting

8. T-Mobile Requested Minimum Requirements. The following represents T-Mobile’s requested minimum monitoring and reporting items that Danger will provide as enhanced monitoring. Danger will create specifications, estimate timing for delivery, and provide proposed shared NRE pricing, if any, for development and incorporation into the Danger Service release schedule in accordance with the Schedule set forth in Section 2.

a. Device-Based KPI Tool.

i) Up to [ * ] Devices – to be delivered in stages, subject to mutual agreement on delivery timing and cost.

ii) E-Mail- uses the T-Mobile network to represent the end to end customer experience for @tmail. This test method measures the timing of a full round trip for an email, including sending and receiving the email.

iii) Web Proxy - uses the T-Mobile network to represent the end-to-end customer experience. Within the test session, the Device-Based KPI Tool requests and retrieves a few of the most popular websites accessed by T-Mobile Subscribers. The web pages used should be configurable as mutually agreed upon. This test method measures the time it takes to request, retrieve and display the web page. The measurement period for this test case is currently set at [ * ]. The success/failure threshold shall be measured at [ * ].

iv) Instant Messaging - uses the T-Mobile network to represent the end-to-end customer experience. Within the test session, the KPI application would log on to the various IM services including AIM and Yahoo Messenger. The measures for success or fail should depend on ability to log on to the messenger service. Failures would be ‘Server Timeouts’, ‘Connection Failures’, etc. This test method therefore measures the total number of successful and failed logins in a period of time. Danger will use reasonable efforts to develop an IM Device-Based KPI tool as described in this Section (1)(a)(iv), but if it is unable to, Danger shall use reasonable efforts to develop (within the applicable time frame) a suitable alternative that is reasonably acceptable to T-Mobile.

b. Near Real-Time Portal. Danger will create a “portal” where T-Mobile can retrieve reports on application performance on a near real-time basis. Data would be reported on at least a 1 hour interval, and may be quicker depending on the particular report or metric.

i) E-Mail – will measure delivery time of simulated emails that are measured from the entry point of the Danger Service, through the Service, and back to the entry point. Reports will show delivery times of the simulated emails.

ii) Web Proxy – will measure web page fetching performance for simulated queries from the entry point of the Danger Service, through the Service, and back to the entry point. Reports will show the fetching performance of the simulated queries.

c. Real Customer Data and Aggregate Data Reporting. Danger will create periodic reports which would be posted on a monthly basis within ten (10) business days after the end of the month to the T-Mobile accessible portal.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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i) Email – reports will include (for @tmail): total number sent; total number received; percentage pass/fail delivery rates; total number of successful delivery; total number of failed delivery; average round-trip performance of customer email from the entry point of the Danger Service, through the Service, and back to the entry point; and number of subs at 90% mail storage capacity.

ii) Web Proxy – reports will include: total web pages requested; total web pages received; percentage pass/fail download within [ * ]; total number of successful download; total number of failed download; and performance of top 10 popular sites.

iii) Instant Messaging – reports will include: percentage pass/fail delivery rates based on failure type; number of subscribers involuntarily terminated. Danger will use reasonable efforts to develop reporting as described in this Section (1)(a)(iv), but if it is unable to, Danger shall use reasonable efforts to develop (within the 16 month timeframe) a suitable alternative that is reasonably acceptable to T-Mobile.

d. Additional Enhanced Reporting – Danger shall use reasonable efforts to scope the following additional requests of T-Mobile:

i) KPI Tool – Performance measurement for email for non-@tmail account types; other tests and more specific tests.

ii) E-Mail – reporting on customer data for sent or received emails to non-@tmail accounts, including volumes by email provider and SMTP failure information.

9. Schedule for Plan of Enhanced Reporting.

Date	Item
Contract Signing	Start Project
+5 weeks	Danger delivers 1st draft of Plan
+1 week	T-Mobile provides feedback on draft Plan
+1 week	Danger produces 2nd draft of Plan
+2 weeks	T-Mobile and Danger agree on Plan
+5 weeks	Danger produces rough draft Schedule and Scope of development and costs
+1 week	T-Mobile provides feedback on Schedule, Scope and Cost
+1 week	T-Mobile and Danger agree to Schedule, Scope and Costs

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT C: CUSTOMER SUPPORT SERVICE LEVEL AGREEMENT

This Customer Support Service Level Agreement (the “CSLA”) sets forth the parties’ agreement with respect to Danger Services that Danger will provide in connection with its performance under the Agreement. This CSLA describes the basic level of Customer Support services that Danger will provide in connection with the Danger Device and Danger Services.

10. Definitions. Capitalized Terms shall have the same meaning as all capitalized defined terms in the Agreement. In addition, the following term(s) shall have the meanings set forth below:

10.1 “Complaint” or “Complaints” shall mean inquiries, issues, concerns or problems made by a Subscriber relating in any way to their use of the Danger Device or Services.

10.2 “UI” or “Danger Device UI” shall mean the unit based operating system utilized by the Danger Device and Danger Service.

10.3 “Basic” when used in conjunction with support or troubleshooting descriptions in the Tier I, Tier II or Tier III Support Tier Definitions shall mean support that can be provided based upon information which has been provided by Danger to T-Mobile during Training (as described in Section 8) or in standard documentation provided to T-Mobile. For greater clarity the list above provides examples for Tier II Support and T-Mobile will be required to provide all “Basic” support except to the extent identified as being Tier III Support.

10.4 “Advanced” when used in conjunction with support or troubleshooting descriptions in the Tier I, Tier II or Tier III Support Tier Definitions shall mean support, which cannot be provided by T-Mobile based upon information, which has been provided by Danger to T-Mobile during Training (as described in Section 8) or in standard documentation provided to T-Mobile. Danger will be required to provide all “Advanced” support.

11. Support

11.1 T-Mobile’s Responsibility for Responding to and Resolving Tier I and Tier II Complaints. All Customer Care telephone calls will be directed to a single toll free phone number staffed and answered by T-Mobile Customer Care representatives, who will address and respond to Customer Tier I and Tier II Complaints relating to the Danger Service and Danger Device as defined in Table I below.

11.2 Danger’s Responsibility for Responding to and Resolving Tier III Complaints. T-Mobile will refer Tier III cases to Danger in accordance with the procedures set forth below:

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Table I - Support Tier Definitions

Tier Level	Description of Customer Inquiries and Assistance Required	Responsible Customer Care Department
Tier I	•     SMS Services – SMS services is the ability to receive and send text messages. Troubleshooting on the Danger Device, network, and message content. •     Rate plans and features – These are the standard billing options Customer Care currently supports. This includes, adding, removing, or changing rate plans or features. •     Billing services – This includes credits & adjustments, billing errors, explanations, addressing bill format. •     Basic Danger Device usage Questions – This covers all basic functions of the Danger Device. Basic product usage questions, which includes all functions of the UI, voice, e-mail, calendar, notes, and tasks.	T-Mobile
Tier II	•     Service outage issues relating to T-Mobile Service outages. Verification of Provisioning, De-provisioning. This is the process of checking the physical switch to see what the Customer is provisioned with and fixing the provisioning or removing it. •     Assist customer with questions regarding basic email functionality provided with the Danger Service and Danger Device. •     Basic Danger Device troubleshooting – This type of troubleshooting is used for provisioning errors, user errors, or UI setup errors. Representatives will make an effort at this Basic Danger Device troubleshooting level to determine where a problem lies. •     Basic RMA inquiries – This troubleshooting is to determine if the Device is faulty, and not the UI, settings, browser or network settings. •     Troubleshooting of Danger provisioning – This includes the troubleshooting of how the account looks in the physical switch. •     Danger Device, earbud, and UI, including basic analysis to determine issues in the Danger Device earbud or UI. •     Danger Browser – This includes basic troubleshooting of the browser that will come with the Danger Device.	T-Mobile

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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	•     New Application Downloads, including basic troubleshooting of downloads approved for support by T-Mobile.
Tier III	•     Advanced Danger Device functionality and operations. •     Danger Device and Danger Service Applications – This includes Advanced troubleshooting of applications that come with the Danger Device, including the UI. New Application Downloads – This would be the Advanced troubleshooting of downloads approved for support by T-Mobile. All other customer issues relating to the use or operation of the Danger Device that T-Mobile’s Tier II organization is unable to resolve using the Training and resources provided by Danger to the Tier I and Tier II organization. All such customer issues will be considered issues requiring “Advanced” support as defined in the Definitions Section of this instrument.	Danger

12. Notice of Tier III Complaint and Resolution.

12.1 T-Mobile’s Customer Care representatives will communicate all Tier III Complaints to Danger, and Danger shall communicate all proposals for handling such Tier III Complaints by way of email. Danger will not be obligated to provide support directly to end-users.

12.2 Danger’s response will include a proposed resolution in the form of a) a complete fix, b) a temporary or permanent workaround, or c) identification of the problem as a bug or new feature request requiring development resources. Danger’s Response will also include its proposed timeline for resolving the Tier III Complaint.

13. Tier III Complaint Resolution Service Level

13.1 Danger shall provide and maintain a Tier III capability with operating hours that correspond with T-Mobile’s Tier II Customer Care operating hours. T-Mobile will provide 90 days notice to Danger of any changes to T-Mobile’s Tier II Customer Care operating hours (M-F: 4am - 9pm pt, Sat: 5am - 2pm pt, Sun: 5am - 11am pt) after which notice period Danger will be required to adjust its Tier III Customer Care operating hours accordingly unless such adjustment requires Danger’s Tier III Customer Care to be available more than [ * ] hours per week, in which case such adjustment will only be made by mutual agreement.

13.2 During Danger’s operating hours, Danger agrees to maintain the following service and response levels (“Customer Care Service Levels”) with respect to all Tier III complaints of which it is notified pursuant to Section 3 above.

(a) [ * ] of all Tier III complaints shall be responded to within [ * ] from the time Danger receives an email describing the Tier III Complaint.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(b) [ * ] of all Tier III inquires shall be responded to within [ * ] from the time Danger receives an email describing the Tier III Complaint.

(c) [ * ] of all Tier III inquires shall be responded to within [ * ] from the time Danger receives an email describing the Tier III Complaint.

14. Danger Service Level Non-Performance. If Danger’s average service levels for Customer Care stated in Section 4.2. A, B and C above fall below the minimum levels identified for [ * ] consecutive months in any consecutive [ * ] period, then T-Mobile shall be entitled to liquidated damages in an amount equal to $[ * ] for each such breach, not to exceed a total of $[ * ] during the term of this Agreement. Danger agrees that this method of calculating liquidated damages, and any sum owing there from, reasonably estimates the damages T-Mobile will sustain resulting from Danger’s failure to meet the minimum service levels. The liquidated damages set forth above shall constitute T-Mobile’s sole and exclusive remedy for Danger’s failure to maintain the average service levels for Customer Care.

15. Escalation Procedures and Contact Information – Unresolved Complaints

15.1 During the Tier III Complaint isolation and troubleshooting process, Danger will communicate incident resolution progress with T-Mobile on a mutually agreed upon frequency schedule. Danger will proactively inform T-Mobile when an issue or condition arises that may cause potentially widespread problems with respect to the Danger Services.

15.2 T-Mobile and Danger will maintain an escalation process to aid in problem resolution should any outstanding incidents warrant, either because Danger has not responded to a Tier III Complaint in a timely fashion or because a particular Tier III Complaint has not been resolved to a Customer’s satisfaction. T-Mobile and Danger will exchange escalation procedures and contact lists. Such lists will be maintained, updated, and republished as may be necessary to include all current procedures and contact information. As of the Effective Date, the escalation process will use the following contact information:

Danger Escalation Contact List

Timetable	Contact Name/Title	Business Hours Contact Number	After Hours Contact Number
Within [ * ] of reporting the incident.	Lead TS or Manger on duty	Main TS Hotline [ * ]
[ * ] 1st level if no satisfaction from 1st level	[ * ], Sr. Technical Support	[ * ]	[ * ]
[ * ] 2nd level if no satisfaction from 2nd level	[ * ], Director, Customer Support	[ * ]	[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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T-Mobile Escalation Contact List

Timetable	Contact Name/Title	Business Hours Contact Number	After Hours Contact Number
Within [ * ] of reporting the incident.	Supervisor on Duty –	[ * ]	[ * ]
[ * ] 1st level if no satisfaction from 1st level	WDG Manager: [ * ] [ * ]	[ * ] [ * ]	[ * ] [ * ]
[ * ] 2nd level if no satisfaction from 2nd level	Director of WDG: [ * ] [ * ]	[ * ] [ * ]	[ * ]

16. Categories and Metric Reporting

16.1 Danger shall provide T-Mobile weekly summary reports of calls by problem category, including but not limited to:

(a) Number of problems per Danger Device.

(b) Number of problems per Danger Device model.

(c) Inquiry types by application and device

16.2 Danger also shall provide the following on a monthly basis:

(a) Total metrics

(i) Number of cases not resolved

(ii) Total time of each case

(iii) Total time to answer each case

(b) Resolution metrics

(i) Number of e-mails not resolved within 2 hours

(ii) Number of e-mails not resolved within 4 hours

(iii) Number of e-mails not resolved within 24 hours

17. Ongoing Support and Training/New Applications. Danger shall provide the training specified below, and except as provided below, such training shall be provided at no expense to T-Mobile.

17.1 Customer Care Training.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(a) At no expense to T-Mobile, each year during the term of this Agreement, Danger shall provide one trainer for up to five (5) days of training at each of T-Mobile technical center.

(b) Such training will address the topics necessary to ensure that T-Mobile Tier I and Tier II Customer Care personnel can adequately provide complete support for the product, including, without limitation, general Danger Device and Danger Service troubleshooting, training on the Danger Desktop Interface and training on the Danger Support Tool (DST).

(c) T-Mobile and Danger will mutually agree on terms in the event additional ongoing training is necessary on the Danger device.

(d) The parties will cooperate in scheduling all required training sessions hereunder.

(e) No more than fifteen (15) T-Mobile personnel shall be in each training group.

17.2 If new Danger Software and/or Danger Services are introduced which are to be offered by T-Mobile, Danger shall provide one trainer for up to five (5) days of training at T-Mobile’s technical center within thirty (30) days prior to release on agreed upon terms.

17.3 Danger shall provide two (2) copies of its training manual in electronic format to T-Mobile during the term of the Agreement. To the extent that Danger updates the training manuals, it shall provide two copies of all such updates in electronic format to T-Mobile.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT D: PREMIUM CONTENT

This Exhibit D sets forth the terms by which the parties shall provide Premium Content to Subscribers. Upon mutual written agreement, the parties may agree to provide Premium Services to Subscribers via the Premium Download Manger upon terms and conditions different than those set forth in this Exhibit.

18. Danger Responsibilities. Danger shall have the following responsibilities with respect to Premium Content:

a. Hosting. Danger shall host the Premium Content on the Danger System and shall make the Premium Content accessible through the Premium Download Manager, which consists of both server-based and device software.

b. Developer Program. Danger shall be responsible for developer support of all Danger Premium Content. Without limiting the generality of the foregoing, Danger shall operate a developer program, at http://developer.danger.com, through which Danger shall make a software development kit (“SDK”) available for download to potential third-party developers of Premium Content. Danger shall use commercially reasonable efforts to regularly update the SDK and to provide reasonable technical support to third-party developers of Premium Content, provided that such technical support does not require Danger to provide any direct phone or email support to developers of T-Mobile Premium Content. Danger will not charge T-Mobile or developers designated by T-Mobile any fees for access to the developer program or to license the SDK. The SDK and Danger online support information will contain sufficient information for a developer of reasonable skill to develop Premium Content. Danger will provide reasonable technical support to T-Mobile for the development of T-Mobile Premium Content.

c. Certification of Danger Premium Content. Upon submission to Danger of proposed Danger Premium Content by a third-party developer, or upon completion of Danger’s development of Danger Premium Content, Danger shall perform the testing and certification activities set forth in the “Danger Baseline Application Acceptance Criteria” document (hereinafter, the “Content Certification Plan”), a copy of which has been supplied by Danger to T-Mobile, as such Content Certification Plan may upon mutual agreement be amended by Danger and T-Mobile from time to time. If Danger discovers any bugs or errors in the proposed Danger Premium Content submitted by a third-party developer, Danger will report such problems to the third-party developer and will work with the third-party developer to correct such errors. Content certified by Danger as being compliant with the Content Certification Plan will be deemed “Danger Certified Premium Content.” Danger shall prepare a certification report summarizing the results for each item of Danger Premium Content tested under the Content Certification Plan, in a format to be mutually agreed to by the parties. Upon T-Mobile’s written request, Danger will make available to T-Mobile the certification test report for any Danger Certified Premium Content.

d. T-Mobile Trial Program. At T-Mobile’s written request, Danger will provide T-Mobile with the opportunity to preview Danger Certified Premium Content by placing them in the T-Mobile Trial Program catalog.

e. Notice of Terms. With respect to each item of Danger Certified Premium Content, Danger shall provide T-Mobile with a written notice containing a short product description, file size, suggested retail pricing, estimated bandwidth usage, and any relevant third-party license terms for such Premium Content (including without limitation the length of time that Danger is licensed to use such

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Premium Content), which information shall also be incorporated in the Premium Content Spreadsheet (as defined below in Section 3(a)).

f. Security. Danger will provide reasonably appropriate security for T-Mobile Premium Content that is at least as great as the security it takes to protect Danger Premium Content. Danger may not disable or modify any security features or functionality that are part of the T-Mobile Premium Content and will use commercially reasonable efforts to incorporate security features or functionality that are provided to Danger by T-Mobile or a third party provider for use in connection with T-Mobile Premium Content.

19. T-Mobile Responsibilities.

a. Developer Support. Except as set forth in Section 2(b), T-Mobile shall be responsible for developer support of all T-Mobile Premium Content.

b. Certification of T-Mobile Premium Content. Upon submission to T-Mobile of proposed T-Mobile Premium Content by a third-party, or upon completion of T-Mobile’s development of T-Mobile Premium Content, if T-Mobile wishes to launch such content on the Danger Device, then T-Mobile shall perform the testing and certification activities set forth in the Content Certification Plan. If T-Mobile discovers any bugs or errors in the proposed T-Mobile Premium Content submitted by a third-party developer, T-Mobile may report such problems to the third-party developer and may work with the third-party developer to correct such errors. Content certified by T-Mobile as being compliant with the Content Certification Plan will be deemed “T-Mobile Certified Premium Content.” T-Mobile shall prepare a certification report summarizing the results for each item of T-Mobile Premium Content tested under the Content Certification Plan, in a format to be mutually agreed to by the parties. Upon Danger’s written request, T-Mobile will make available to Danger the certification test report for any T-Mobile Certified Premium Content.

c. Delivery. T-Mobile shall deliver each item of T-Mobile Certified Premium Content to Danger in final release form no later than three (3) days prior to the scheduled commercial launch date for such content.

d. T-Mobile Trial Program. At T-Mobile’s written request, Danger will place proposed T-Mobile Premium Content in the T-Mobile Trial Program catalog to help facilitate T-Mobile’s testing and certification efforts. Following receipt of such request, Danger will use commercially reasonable efforts to place such T-Mobile Premium Content in the trial catalog within three (3) business days after receiving such content from T-Mobile. Danger shall create a separate “restricted access” folder in the PDM for use by T-Mobile in the T-Mobile Trial Program. Unless T-Mobile instructs Danger in writing otherwise, Danger will place all T-Mobile Premium Content in the “restricted access” folder. T-Mobile shall have the right to specify up to 50 T-Mobile Trial Program participants that will be allowed access to the “restricted access” folder and the Content therein. No other T-Mobile Trial Program participants will be permitted to have access to the Content in the “restricted access” folder.

e. Notice of Terms. With respect to each item of T-Mobile Certified Premium Content, T-Mobile shall provide Danger with a written notice containing a short product description, file size, retail pricing, deck placement, estimated bandwidth usage and any relevant third-party license terms for such Premium Content, which information shall also be incorporated in the Content Spreadsheet (as defined below in Section 3(a)). T-Mobile will provide such notice to Danger no later than three (3) business days prior to the scheduled publication date for the content concerned.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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20. Commercial Deployment of Premium Content in the Premium Download Manager.

a. Content Spreadsheet. Danger will maintain a Certified Premium Content spreadsheet that will list all Danger Certified Premium Content and T-Mobile Certified Premium Content (“Content Spreadsheet”). The Content Spreadsheet will contain a list of both T-Mobile Certified and Danger-Certified Premium Content. For each item, the Content Spreadsheet will contain a short description, suggested retail pricing, estimated bandwidth usage, file size of the Content, any relevant license terms, and a target publication date.

b. Content Availability, Schedule, and Placement. Subject to the provisions in this Section, T-Mobile, in its sole discretion, shall have full editorial control with respect to the [ * ] from the release of such Content. If Danger does not have the necessary rights for the proposed Danger Premium Content to be distributed for a minimum of [ * ], then prior to T-Mobile’s consideration and approval of such Content, Danger will provide notice to T-Mobile, in the manner set forth in Section 1(e), of the length of time that such Content may be distributed. T-Mobile and Danger will periodically review proposed Danger Premium Content and T-Mobile will identify the proposed Danger Premium Content that it approves. If T-Mobile approves of such Danger Premium Content, then T-Mobile will use commercially reasonable efforts to launch such Content, with a launch date no later than sixty (60) days after T-Mobile’s approval or Danger’s Certification, whichever is later. Subject to the expedited take-down requests in this Section 3(b), or the removal of Content provisions in Section 3(c), T-Mobile will maintain any approved Danger Premium Content on the Danger Device for no less than six (6) months from its launch date. T-Mobile may, at its sole discretion, create a “What’s New” folder in the PDM for the purpose of promoting newly added Premium Content. If T-Mobile creates a “What’s New” folder, and if Danger launches a new item of Danger Premium Content during a month, then T-Mobile shall promote the availability of at a minimum of [ * ] piece of the new Danger Premium Content available that month by placing it in the “What’s New” folder in the Catalog application for a minimum of [ * ] after initial commercial launch of such content. Upon request by T-Mobile, Danger will take down such item of Premium Content within a commercially reasonable period of time; provided, however, if T-Mobile requests an expedited take-down period, Danger will use commercially reasonable efforts to take down the Premium Content as quickly as possible, but no later than one (1) business day following T-Mobile’s request (e.g., T-Mobile is required by a third party content provider or government order to remove Content on an expedited basis). Notwithstanding the preceding sentence and except as permitted under Section 6(c)(iii), T-Mobile may not request take-down of any item of Danger Premium Content during the [ * ] following the commercial launch of such Danger Premium Content. T-Mobile’s right and Danger’s obligation to take down the Intellisync Software under the preceding sentence shall be subject to the limitations set forth in Section 3(c).

c. Removal of Premium Content.

(i) Danger Premium Content. After notice to T-Mobile, Danger may reject proposed Danger Premium Content, or remove any Approved Danger Premium Content from the Premium Download Manager that, in Danger’s reasonable discretion (A) infringes the intellectual property or other rights of a third party, (B) is libelous, defamatory, obscene or pornographic, (C) may violate other civil or criminal laws; including those regulating the use and distribution of content on the Internet and protection of personal privacy, (D) is technically non-functional or inhibits the performance of other applications on the device, or (E) threatens the security or stability of the Danger Services. In addition, Danger may elect not to launch Danger Premium Content in the event that, in Danger’s good-faith business judgment, T-Mobile’s suggested retail price for such content does not allow Danger to cover its cost plus a reasonable profit margin for such Content.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(ii) T-Mobile Premium Content. Danger may reject proposed T-Mobile Premium Content, or remove from the catalog and suspend the server-side functionality of any Approved T-Mobile Premium Content from the Premium Download Manager that, in Danger’s reasonable discretion, threatens the security or stability of the Danger Service, Danger Device, or Basic Services. Notwithstanding the preceding sentence, prior to removing any T-Mobile Premium Content, Danger will use commercially reasonable efforts to contact T-Mobile in order to request approval of such removal. For purposes of clarification, each party agrees that Danger’s suspension right granted in the preceding sentence is limited to suspending the server-side functionality of Approved T-Mobile Premium Content. Danger may not under any circumstances remove an application from a Subscriber’s Danger Device via Over-the-Air update or otherwise without the prior written approval of T-Mobile. In addition, after notice to and with approval from T-Mobile, Danger may remove any Approved T-Mobile Premium Content from the Premium Download Manager that, in Danger’s reasonable discretion (A) infringes the intellectual property or other rights of a third party, (B) is libelous, defamatory, obscene or pornographic, (C) may violate other civil or criminal laws; including those regulating the use and distribution of content on the Internet and protection of personal privacy, or (D) is technically non-functional or inhibits the performance of other applications or services on the device. If T-Mobile disagrees with Danger in regard to the need to remove T-Mobile Premium Content, then the parties will meet (in person or via telephone) to discuss and mutually agree on whether such content should be removed.

(iii) Nothing in the Agreement or this Amendment (including without limitation Sections 3(b) and 11) shall obligate T-Mobile to include any Premium Content (including without limitation the Intellisync Software) in the Premium Download Manager or Danger’s Desktop Interface and Danger will promptly remove the Premium Content within no more than one (1) business day following notice, if such Premium Content: (A) infringes the intellectual property or other rights of a third party, (B) is libelous, defamatory, obscene or pornographic, (C) may violate other civil or criminal laws; including those regulating the use and distribution of content on the Internet and protection of personal privacy, (D) is technically non-functional or inhibits or impairs the performance the T-Mobile Network or other applications on the device, or (E) causes or results in a higher than average number of calls to or refunds or credits from T-Mobile’s customer care. If T-Mobile removes the Intellisync Software from Danger’s Desktop Interface under this Section without obtaining Danger’s prior written consent (which consent will not be unreasonably withheld) prior to T-Mobile’s payment to Danger for [ * ] downloads of the Intellisync Software, T-Mobile shall pay Danger US$[ * ] As of the end of October 2005, each party agrees that there have been [ * ] downloads of the Intellisync Software.

21. Revenue Share. The parties agree that the following terms shall apply with respect to payments and the allocation between the parties of revenue derived from the distribution to Subscribers of Approved Premium Content through the Premium Download Manager.

a. Danger Premium Content.

(i) Applications. With respect to each download of a Danger Premium Content application to a Danger Device, T-Mobile shall pay Danger the following fees:

(1) Client-Only Applications. In respect of each Danger Premium Content application that is a client-only application (i.e., such application does not operate using T-Mobile’s wireless network), T-Mobile shall pay Danger [ * ] percent ([ * ]%) of the per-download retail selling price for such application for each Successful Download of such application to a Subscriber.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(2) Network-Based Applications. In respect of each Danger Premium Content application that is a network-based application (i.e., such application allows Subscribers to interact over the wireless network as opposed to a client-only application), T-Mobile shall pay Danger: [ * ] percent ([ * ]%) of the per-download retail selling price for such application for each Successful Download of such application to a Subscriber.

(3) Ringtones.

(A) Content Fees. T-Mobile will pay to Danger a content fee for each Successful Download of a ringtone that is Danger Premium Content as set forth below:

(B) Polyphonic ringtones and Hi-Fi Ringers: T-Mobile will pay Danger [ * ] ($[ * ]) plus [ * ] percent ([ * ]%) of [ * ] revenues (excluding taxes) received by T-Mobile in excess of [ * ] ($[ * ]) for the Successful Download of such ringtone.

(C) Sound Effects: T-Mobile will pay Danger [ * ] ($[ * ]) for each Successful Download of such ringtone.

(D) Voice Ringers: T-Mobile will pay Danger [ * ] ($[ * ]) for each Successful Download of such ringtone.

(E) Delivery Fee. In addition to the service fee set forth above, for each Successful Download of a ringtone that is a Danger Premium Content, T-Mobile will pay to Danger [ * ] ($[ * ]).

(F) Special Fees. In the event that special circumstances apply to particular ringtones that are Danger Premium Content (e.g., third party license fees are not fully covered by the royalties set forth above), Danger may notify T-Mobile in writing that it desires to modify the royalties specified above for such ringtones and T-Mobile and Danger may thereafter engage in good faith negotiations with respect to a modification of the royalty rates for such ringtones. T-Mobile is under no obligation to accept Danger Premium Content that are subject to special fees.

b. T-Mobile Premium Content.

(ii) Applications. With respect to T-Mobile Premium Content, T-Mobile shall pay Danger the fees set forth below:

(1) Client-Only Applications. For client-only T-Mobile Premium Content applications, T-Mobile shall pay Danger a delivery fee of $[ * ] for each Successful Download of such application to a Danger Device.

(2) Network-Based Applications. For each T-Mobile Premium Content application that is network-based, T-Mobile shall pay Danger a delivery fee of $[ * ] for each Successful Download of such application to a Danger Device.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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(3) Ringtones. For T-Mobile Premium Content ringtones, T-Mobile shall pay Danger: (A) a delivery fee of $[ * ] for each Successful Download of such ringtone to a Danger Device (excluding downloads for internal T-Mobile employee testing); and (B) a [ * ] fee of [ * ] percent ([ * ]%) of [ * ]. The [ * ] fee shall not be due for: (i) [ * ]. For purposes of clarification, the preceding payment obligation for [ * ] is not to be interpreted to mean [ * ].

c. Invoices. Within thirty (30) days after the end of each calendar month during the Term, Danger will invoice T-Mobile for amounts due under this Section 4 and T-Mobile will pay such invoices within thirty (30) days following receipt thereof.

22. End User Support. The parties agree that the following terms shall apply with respect to end-user support for the Approved Premium Content:

a. Danger Premium Content. Danger’s license agreements with third-party developers of Danger Premium Content shall provide that the developers are responsible for end- user support via email, with an email acknowledgement response time of 24 hours or less. As of the effective date of this Agreement, Danger will require its third party developers to create a FAQ web site for each Danger Premium Content application. Danger will provide to T-Mobile the email contact address and html FAQ address for each Danger Premium Content application. T-Mobile and, if applicable, Danger shall refer all end user requests for support related to Danger Premium Content directly to the applicable developer. For Danger Premium Content that are developed by Danger, Danger will provide T-Mobile an email address and will respond within 24 hours from a support request sent to such email address. Danger will also create an html FAQ page for each Danger Premium Content application.

b. T-Mobile Premium Content. T-Mobile’s license agreements with third-party developers of T-Mobile Premium Content may provide that the developers are responsible for end-user support via email, with an email acknowledgement response time of 24 hours or less. T-Mobile and, if applicable, Danger shall refer all end user requests for support related to T-Mobile Premium Content directly to T-Mobile or the applicable developer at T-Mobile’s discretion. Danger shall have no obligation to provide support to end users in connection with T-Mobile Premium Content.

c. Danger Support Tool. Danger shall ensure that the Premium Download Manager interfaces with the Danger Support Tool in order to provide T-Mobile’s customer service representatives with information about what Premium Content applications have been downloaded to Danger Devices and the ability to resend Premium Content to Subscribers or credit their accounts for Premium Content that was previously downloaded. The Danger Support Tool will allow T-Mobile to look up transactions by applicable Danger Device phone number and in accordance with the then-current Third Party content Customer Care Interface Document. In addition, the Danger Support Tool will list the URL to the FAQ for the applicable application and provide a developer email address for such application.

23. Billing Integration. In order to enable end-user billing for the Premium Content, Danger and T-Mobile will comply with the Danger Premium Download Manager Narus Mediation Solution Architecture Document Version 1.3 and dated October 20, 2003, and as may be updated from time to time upon mutual agreement by the parties.

24. Reporting. Danger has developed an extranet site that enables T-Mobile to review reporting information regarding the downloading of Premium Services on a daily basis. The parties acknowledge and agree that such daily reports are unofficial reports and shall not be relied upon in calculating payments due hereunder.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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25. Indemnification. For the avoidance of doubt, T-Mobile Premium Content shall constitute T-Mobile Premium Services for purposes of Section 17.4 of the Agreement and Danger Premium Content shall constitute Danger Services for purposes of Section 17.1 of the Agreement. Notwithstanding the above, for T-Mobile Premium Content that are ringtones for which T-Mobile pays to Danger [ * ] pursuant to Section 4(b)(ii), then Danger will indemnify T-Mobile under Section 17.1 of the Agreement for any third party claims that the use or distribution of such ringtones [ * ]. Notwithstanding the above, for T-Mobile Premium Services that are ringtones for which T-Mobile identifies to Danger that a [ * ] is not required pursuant to Section 4(b)(ii), then T-Mobile will indemnify Danger under Section 17.4 of the Agreement from any third party claim that the use or distribution of such ringtones violates a [ * ].

26. Yahoo Messenger Integration. Danger will make Yahoo^® Messenger, as more fully described in Schedule 1 attached hereto, available to Subscribers who are using the Danger Device known as Sidekick II via the Premium Download Manager. The Yahoo Messenger application will be considered to be Danger Premium Content. The parties agree to enter into all necessary license and any other agreements reasonably necessary to enable the parties to provide Yahoo Messenger to Subscribers. Danger will provide monthly reports to T-Mobile with respect to Yahoo Messenger containing the information set forth in Schedule 1 hereto.

27. IP Relay. Danger will pay T-Mobile [ * ] percent ([ * ]%) of [ * ] in connection with the distribution of IP Relay applications (as described in Schedule 2). The MCI and/or GoAmerica IP Relay applications will be considered to be Danger Premium Content.

28. Intellisync Software.

a. Intellisync Software. Danger agrees to provide T-Mobile with Intellisync^® software from Intellisync Corporation, which will enable Subscribers to synchronize personal information management data (including calendar, contacts and to do lists) between Microsoft Outlook and Danger Devices via the Danger Content (the “Intellisync Software”). The Intellisync Software will include the features and functionality set forth in Schedule 3 hereto. For purposes of this Agreement, the Intellisync Software will be considered a Danger Premium Content.

b. Distribution of Intellisync Software. T-Mobile agrees that Danger shall make the Intellisync Software available to all Subscribers through Danger’s Desktop Interface. The distribution of the Intellisync Software to each Subscriber shall be pursuant to an end user license agreement that prohibits copying and reverse engineering of the Intellisync Software, disclaims warranties for the Intellisync Software, and limits liability to the greatest extent allowed by law. Each Subscriber downloading the Intellisync Software shall be required to affirmatively agree to the terms of such end-user license agreement before downloading or installing the Intellisync Software or any portion thereof.

c. Billing and Payment for the Intellisync Software.

(i) Danger will provide T-Mobile with electronic records of Subscriber downloads of the Intellisync Software. Such records shall be provided by Danger via the “Premium Download Manager” billing system agreed to by the parties.

(ii) For the first [ * ] downloads of the Intellisync Software, T-Mobile will pay Danger US$[ * ] for each Subscriber successful download of the Intellisync Software (the “Initial Intellisync Fee”). For Intellisync Software downloads in excess of [ * ], T-Mobile will pay to Danger the greater of (i) [ * ] percent ([ * ]%) of the [ * ] for each successful download of the Intellisync Software or (ii) $[ * ] per successful download of the Intellisync Software. [ * ] shall not [ * ] of the Intellisync

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Software if [ * ] provided such [ * ] within thirty (30) days after the applicable download. Danger shall invoice T-Mobile for amounts due hereunder with the same invoice for Danger Premium Content as provided for in above.

(iii) If T-Mobile discontinues the availability of the Intellisync Software, Danger shall continue to cause the Danger Content to support the existing users of the Intellisync Software in accordance with the terms of the Agreement (including Sections 4.1(b) and Exhibit B: Content Level Agreement)) for a [ * ] or such longer period as may be required by the end user license agreement. Danger’s obligation to continue support in the preceding sentence shall be limited to the last version of the Intellisync Software distributed by Danger through T-Mobile. Notwithstanding anything set forth in Section 11(c)(ii), T-Mobile may, following written notice to Danger and contingent on the parties agreeing on an amount (not to exceed [ * ] ($[ * ]) per Danger Device) that T-Mobile will pay Danger for the Installed Base (as defined below), switch from the “per download” payment structure set forth in Section 11(c)(ii) a “per Danger Device” payment structure. Under the “per Danger Device” payment structure T-Mobile will pay Danger [ * ] ($[ * ]) for each Danger Device shipped after the new payment structure is put into effect that has the ability to use the Intellisync Software. The “Installed Base” shall be calculated as follows: the sum of (i) the number of current Active Subscribers of “Monochrome”, “Tina”, and “Turner” Danger Devices and (ii) all “M-1” (or other future Danger Devices currently available) shipped to T-Mobile, less (iii) the number of downloads of the Intellisync Software by Subscribers. The Installed Base calculation shall be made as of the date the “per Danger Device” payment structure went into effect.

(iv) Danger will provide T-Mobile with reports detailing Intellisync Software download activity that are consistent with the reports provided for application download activity on the “Premium Download Manager”.

d. Customer Support for Intellisync Software. T-Mobile will provide customer support for the Intellisync Software to Subscribers in accordance with Section 4.2 of the Agreement and the Customer Support SLA. Danger shall perform its support obligations with respect to the Intellisync Software in accordance with Section 4.2 of the Agreement and Exhibit C: Customer Support SLA. Danger shall have no obligation to provide customer support for the Intellisync Software directly to Subscribers.

29. The parties agree that the following provisions of the Agreement will not apply with regard to Premium Content: Sections 3, 4.1, 6.3, 6.7, 7, 8, 9, 11 and 13.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT D, SCHEDULE 1

[ * ]

EXHIBIT D, SCHEDULE 2

[ * ]

EXHIBIT D, SCHEDULE 3

[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT E: ROADMAP

[ * ]

Results of March 22, 2006 Quarterly Roadmap Meeting

Roadmap Items	Target Delivery	Category	Bonus/Penalty
[ * ]	4Q’06	Development Fund	None
[ * ]	1Q’07	T-Mobile Priority Item	None
[ * ]	4Q’06	T-Mobile Priority Item	None
[ * ]	2Q’07	T-Mobile Priority Item	None
[ * ]	3Q’06	Development Fund	None
[ * ]	4Q’06	Development Fund	None
[ * ]	TBD	Development Fund	TBD
[ * ]	TBD	T-Mobile Priority Item	TBD
[ * ]	TBD	T-Mobile Priority Item	TBD
[ * ]	TBD	Development Fund	TBD

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT F:

[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Exhibit G: End User License Agreement

DANGER^® SERVICE AND END-USER LICENSE AGREEMENT

IMPORTANT: PLEASE CAREFULLY READ THIS SERVICE AND END-USER LICENSE AGREEMENT (THE “AGREEMENT”) BETWEEN YOU AND DANGER, INC. (“DANGER”) BEFORE YOU USE YOUR WIRELESS DEVICE (THE “DEVICE”). YOUR USE OF THE DEVICE OR THE SERVICE FOR THE DEVICE SHALL CONSTITUTE YOUR BINDING ACCEPTANCE OF ALL OF THE TERMS AND CONDITIONS OF THIS AGREEMENT. IF YOU DO NOT AGREE TO ALL OF THE TERMS AND CONDITIONS OF THIS AGREEMENT, THEN YOU MAY NOT USE THE DEVICE OR THE SERVICE AND SHOULD PROMPTLY RETURN THE DEVICE TO THE PLACE WHERE YOU PURCHASED IT.

Danger owns and operates a service that enables certain features on your Device, including email, Internet access, instant messaging, address book, and calendar functions, and that also allows you to access such features from a Web site operated by Danger (the “Service”). Your use of the Service and the Software (as defined below) in the course of operating your Device is subject to the terms and conditions of this Agreement. Danger reserves the right to change or modify any of the terms and conditions contained in this Agreement or any policy referenced herein at any time and in its sole discretion. You may access this agreement at www.danger.com/agreements. If the Agreement is changed, we will post the new terms to such Web page. Any changes or modifications will be effective upon posting, and your continued use of the Service or Software after the posting of such changes will constitute your binding acceptance of the Agreement as revised.

30. Software

30.1 Definition. “Software” means any computer software, in executable code form, owned by Danger (or software owned by third parties, which Danger has the right to distribute or sublicense) and either pre-loaded on the Device at the time of manufacture or otherwise furnished to you by Danger in its sole discretion. “Software” includes the Danger^® operating system and applications.

30.2 License Grant. Subject to the terms and conditions of this Agreement, Danger hereby grants to you a nonexclusive, nontransferable, nonsublicenseable license to use, perform, and display the Software using the Device upon which the Software was originally installed, and solely as necessary to operate the Software in accordance with the applicable documentation.

30.3 Restrictions. You may not (a) reproduce, distribute, sublicense, use for service-bureau purposes, sell, lease, or otherwise transfer the Software to any third parties; (b) modify, alter, improve, “hack,” or create derivative works of the Software; or (c) reverse-engineer, decompile, disassemble, reverse-assemble, or otherwise attempt to derive the source code of the Software.

30.4 Third-Party Software. You understand and agree that in addition to the Software, the Device may contain certain third-party software (“Third-Party Software”) the use of which may be subject to separate license agreements containing additional terms and conditions. Any such license agreements will be provided to you separately. You hereby agree to comply with all such additional terms and conditions in your use of the Third-Party Software.

31. Ownership. The Software is licensed to you, not sold. Danger and its licensors retain exclusive ownership of all proprietary rights, including all patent, copyright, trade secret, trademark and other intellectual property rights worldwide, in and to the Service and the Software (including any corrections, bug fixes, enhancements, updates or other modifications thereto). There are no implied licenses under this Agreement, and all rights not expressly granted are hereby reserved.

32. Use of the Service

32.1 Wireless Service Provider. In addition to Danger’s terms and conditions set forth in this Agreement, you agree and acknowledge that your use of the Service is subject to your wireless carrier’s terms and conditions of service.

32.2 Privacy Policy. Danger believes strongly in protecting user privacy and providing you notice of Danger’s collection and use of data, including personally identifying information. To learn about Danger’s information collection and use practices and policies for the Service, please refer to the Danger Service Privacy Notice.

32.3 Your Account. All information that you provide in connection with your registration for the Service must be accurate. You will receive a password and username upon completing your registration. You are responsible for maintaining the confidentiality of the password and account information, and are fully responsible for all activities that occur under your password or account. You agree to immediately notify your wireless network operator of any unauthorized use of your password or account or any other breach of security.

32.4 Prohibited Activities. You agree not to use the Service to: (a) directly or indirectly violate any applicable laws, rules, or regulations issued or promulgated by any competent government authority, including without limitation any

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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intellectual property laws, privacy laws, computer fraud or abuse statutes, or export control laws; (b) upload, post, email or transmit any content that you do not have the right to post or transmit under any law, contractual duty or fiduciary relationship; (c) upload, post, email or transmit any content that infringes a third party’s trademark, patent, trade secret, copyright, publicity, privacy, or other proprietary right; (d) upload, post, email or transmit any materials that are unlawful, untrue (including incomplete, false or inaccurate biographical information), harassing, libelous, defamatory, abusive, tortuous, threatening, obscene, pornographic, indecent, hateful, abusive, or harmful (including but not limited to viruses, corrupted files, or any other similar software or programs); (e) violate, attack, or attempt to violate or attack the security, integrity, or availability of any network, service, or other computer system; (f) send mass unsolicited or unauthorized electronic messages or “spam”, including without limitation, promotions or advertisements for products or services; (g) send altered, deceptive or false source-identifying information (including forged TCP/IP headers); or (h) use the Service in a manner that otherwise violates Danger’s then-current Acceptable Use Policy, the latest version of which is available at www.danger.com/agreements. Violations of any of the above will be investigated by Danger and, where appropriate, Danger may either institute legal action, or cooperate with law enforcement authorities in bringing legal proceedings, against users who violate this Agreement.

32.5 Third-Party Content and Services. In the course of using the Service, you may download to the Device content that is provided by third parties and/or access services and Web sites provided by third parties, including third-party Web sites accessible through links from the Service. Danger is not responsible for the content, products, materials, or practices (including privacy practices) of any such Web sites or third-parties. You understand that by using the Service you may be exposed to third-party Web sites or content that you find offensive, indecent or otherwise objectionable. Danger makes no warranty, representation, endorsement, or guarantee regarding, and accepts no responsibility for, the quality, content, nature or reliability of third-party Web sites (including Web sites accessible by hyperlink from the Service) or third party products or services accessible via the Service. Danger provides links to third-party Web sites for your convenience only and Danger does not control such Web sites. Danger’s inclusion of links to third party Web sites or access to third party products does not imply any endorsement of the third parties or their products and services. It is your responsibility to review the privacy policies and terms of use that apply to third party Web sites you visit or to third party content and services you access. In no event will Danger be liable to you in connection with any Web sites, content, products, services, materials, or practices of a third party.

32.6 Uploading and Downloading of Information. You hereby agree and acknowledge: (a) that Software, data, and other information may be downloaded from Danger to your Device and requests for information may be uploaded from your Device to Danger on a regular basis; (b) that Danger makes no guarantee of, and is not responsible for, the accuracy or completeness of any downloaded information; and (c) that the Service may be inoperable from time-to-time and Danger shall incur no liability for such inoperability. You also hereby agree and acknowledge that any information, content or software that you upload or download using a particular Device model may not be available to you in the event that you switch to different Device model.

33. Intellectual Property Rights

33.1 Copyright. All content included on the Device, including graphics, text, images, logos, button icons, images, audio and video clips and software, as well as the compilation of the content, is the property of Danger and/or its licensors (“Danger Material”) and is protected by U.S. and international copyright laws. Any unauthorized use of Danger Material may violate copyright, trademark or other laws. Additionally, certain other content, including, websites, photographs, images, text, graphics, video clips, audio recordings, or other content accessed or transmitted through the Service may be copyrighted by third parties and protected by U.S. and international copyright law. Materials that are copyrighted may be viewed as presented and are for personal use only. Unless otherwise authorized by law, you agree not to alter, falsify, misrepresent, modify, copy, reproduce, republish, upload, post, transmit, distribute or otherwise utilize such materials without the express, written permission of the copyright holder. Unauthorized copying or distribution of copyrighted works is an infringement of the copyright holders’ rights. Pursuant to the Digital Millennium Copyright Act, Danger reserves the right to terminate the accounts of users of the Service who are infringers of the copyrights of others.

33.2 Trademarks. Danger, hiptop, Get Away With It!, hiplogs, Flip For It, the Danger logo and the hiptop logo are trademarks, service marks, and/or registered trademarks of Danger, Inc. in the United States and in other countries. You agree not to use Danger’s trademarks (i) to identify products or services that are not Danger’s, (ii) in any manner likely to cause confusion, (iii) in or as a part of your own trademarks, (iv) in a manner that implies that Danger sponsors or endorses your products or services or (v) in any manner that disparages or discredits Danger. You must have Danger’s prior written consent before you use Danger’s trademarks in any way.

34. No Monitoring; Necessary Disclosures. You acknowledge that Danger does not pre-screen or monitor content posted to or transmitted through the Service, but that Danger shall have the right (but not the obligation) to remove any content in its sole discretion, including, without limitation, any content that violates this Agreement. In addition, Danger reserves the right to disclose all content that you upload, post, email, transmit or otherwise make available via the Service (whether or not directed to Danger) if required to do so by law or in the good faith belief that such disclosure is necessary or appropriate to conform to the law or comply with legal process served on Danger, to protect and defend the rights or property of Danger, the Service or our customers, whether or not required to do so by law, or to protect the personal safety of our customers or the public.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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35. Termination. You agree that Danger or its service partners, in their sole discretion, may immediately terminate your access to the Service (whether directly or through your wireless carrier) if they believe that you have violated the terms and conditions of this Agreement. You agree that any termination of your access to the Service may be effected without prior notice, and acknowledge and agree that, upon termination, Danger and its service partners may immediately deactivate or delete your account and all related information, emails, files and other data in your account and/or bar any further access to such files or the Service. Further, you agree that neither Danger nor its service partners shall be liable to you for any termination of your access to the Service hereunder.

36. NO WARRANTIES. THE SERVICE AND SOFTWARE ARE PROVIDED BY DANGER ON AN “AS IS” BASIS. DANGER, ITS SUPPLIERS AND SERVICE PROVIDERS HEREBY DISCLAIM ALL REPRESENTATIONS OR WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED, OR STATUTORY, RELATING TO THE SERVICE OR THE SOFTWARE (INCLUDING ANY INFORMATION, CONTENT, MATERIALS OR PRODUCTS THAT YOU MAY ACCESS THROUGH THE SERVICE), INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, QUIET ENJOYMENT, NON-INFRINGEMENT OF THIRD PARTY RIGHTS, ACCURACY OF INFORMATIONAL CONTENT, AND ANY WARRANTIES ARISING FROM A COURSE OF DEALING OR USAGE OF TRADE. WITHOUT LIMITING THE FOREGOING, YOU ACKNOWLEDGE THAT DANGER, ITS SUPPLIERS AND SERVICE PROVIDERS DO NOT WARRANT OR REPRESENT THAT THE SERVICE OR THE SOFTWARE WILL MEET YOUR REQUIREMENTS, THAT THE SERVICE OR THE SOFTWARE WILL BE TIMELY, SECURE, UNINTERRUPTED, OR ERROR-FREE, THAT DEFECTS IN THE SERVICE OR THE SOFTWARE WILL BE CORRECTED, THAT ANY CONTENT OR INFORMATION CONTAINED IN THE SERVICE OR ACCESSED THROUGH YOUR USE OF THE DEVICE WILL BE ACCURATE, COMPLETE, RELIABLE, OR ERROR-FREE, THAT THE SOFTWARE OR ANY MATERIALS AVAILABLE FOR DOWNLOAD FROM THE SERVICE WILL BE FREE OF VIRUSES OR OTHER HARMFUL COMPONENTS, OR THAT THE SERVICE WILL BE FREE FROM UNAUTHORIZED ACCESS (INCLUDING THIRD PARTY HACKERS OR DENIAL OF SERVICE ATTACKS). FURTHER, AS THE WIRELESS CARRIER IS NOT CONTROLLED BY DANGER, NO WARRANTY IS MADE AS TO COVERAGE, AVAILABILITY OR GRADE OF SERVICE PROVIDED BY THE WIRELESS CARRIER. PLEASE NOTE THAT SOME JURISDICTIONS MAY NOT ALLOW THE EXCLUSION OF IMPLIED WARRANTIES, SO SOME OF THE ABOVE EXCLUSIONS MAY NOT APPLY TO YOU.

37. LIMITATION OF LIABILITY. IN NO EVENT SHALL DANGER, ITS SUPPLIERS OR SERVICE PROVIDERS BE LIABLE TO YOU FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, OR OTHER DAMAGES (INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF PROFITS, BUSINESS INTERRUPTION, LOSS OF INFORMATION OR DATA, OR OTHER PECUNIARY LOSS) RESULTING FROM YOUR ACCESS TO, OR USE OR INABILITY TO USE THE SERVICE OR SOFTWARE (INCLUDING AS A RESULT OF AN OUTAGE OF THE SERVICE PROVIDED BY YOUR WIRELESS CARRIER OR ANY OTHER THIRD-PARTY SERVICE PROVIDER, OR WITH RESPECT TO THE INFORMATION, SERVICES, CONTENT OR ADVERTISEMENTS CONTAINED ON OR OTHERWISE ACCESSED THROUGH THE SERVICE. IN NO EVENT WILL DANGER, ITS SUPPLIERS OR SERVICE PROVIDERS BE LIABLE TO YOU IN CONNECTION WITH THE SERVICE OR THE SOFTWARE FOR ANY DAMAGES IN EXCESS OF TWO HUNDRED U.S. DOLLARS (U.S. $200).

38. Indemnity. You agree to defend, indemnify, and hold harmless Danger, its officers, directors, employees and agents, from and against any claims, actions or demands, including without limitation reasonable attorneys’ fees, made by any third party due to or resulting from your violation of this Agreement.

39. Export Controls. You agree and acknowledge that the Software may contain cryptographic functionality the export of which is restricted under U.S. export control law. You will comply with all applicable laws and regulations in your activities under this Agreement, including without limitation all export laws and regulations of the U.S. Department of Commerce and all other U.S. agencies and authorities, including the Export Administration Regulations promulgated by the Bureau of Industry and Security (as codified in 15 C.F.R. Parts §§ 730-774). You expressly agree not to export or re-export the Software in violation of such laws or regulations, or without all required licenses and authorizations.

40. Government End Users. The Software is a “commercial item” as that term is defined at 48 C.F.R. 2.101, consisting of “commercial computer software” and “commercial computer software documentation” as such terms are used in 48 C.F.R. 12.212. Consistent with 48 C.F.R. 12.212 and 48 C.F.R. 227.7202-1 through 227.7202-4, all U.S. Government end users acquire the Software with only those rights set forth therein.

41. Applicable Law and Jurisdiction. You agree that this Agreement and all matters relating to the Service and the Software will be governed by the laws of the State of California, without giving effect to any principles of conflicts of laws that would require the application of the laws of a different state. You also consent to the exclusive jurisdiction and venue of the Superior Court of Santa Clara County for state claims and the Northern District of California for federal claims in all disputes arising out of or relating to the Software or the Service. The parties agree that the Uniform Computer Information Transaction Act (or any statutory implementation of it) and the United Nations Convention on the International Sale of Goods will not apply with respect to this Agreement or the parties’ relationship.

42. General Provisions. You are responsible for compliance with applicable local laws. This Agreement is personal to you, and you may not transfer, assign or delegate this Agreement to anyone without the express written permission of Danger. Any attempt by you to assign, transfer or delegate this Agreement without the express written permission of Danger shall be null and void. The paragraph headings in this Agreement, shown in boldface type, are included to help make the agreement easier to read and have no binding effect. The waiver of any breach or default, or any delay in exercising any

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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rights shall not constitute a waiver of any subsequent breach or default. This Agreement constitutes the complete and exclusive agreement between you and Danger with respect to the subject matter hereof, and supersedes all prior oral or written understandings, communications or agreements. If for any reason a court of competent jurisdiction finds any provision of this Agreement, or portion thereof, to be unenforceable, that provision of the Agreement will be enforced to the maximum extent permissible so as to effect the intent of the parties, and the remainder of this Agreement will continue in full force and effect.

Last updated: March 1, 2006

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT H: TRADEMARKS

DANGER:

[ * ]

T-MOBILE:

[ * ]

Each party’s trademark usage guidelines, as such may be amended from time to time, are hereby included by reference.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

71.

September 27, 2006

Cole Brodman

Sr. Vice President and Chief Development Officer

T-Mobile USA, Inc.

12920 SE 38th Street

Bellevue, WA. 98006

Re: MyFaves Development

Dear Cole:

This letter sets forth the agreement between Danger, Inc. (“Danger”) and T-Mobile USA, Inc. (“T-Mobile”) regarding the development of a MyFaves application (the “MyFaves Application”) for Danger Devices.

1. Scope of Work.

(a) Danger Deliverables. Danger will implement the MyFaves Application in the following three phases:

(i) Rich Feature Set. The first phase (the “Rich Feature Set”) will implement the functionality set forth in Exhibit A to this letter. The Rich Feature Set will be available on the Sidekick Style Danger Device (the “Style,” which may also be referred to as the “Sidekick ID”) at the time such devices commercially launch.

(ii) Full Feature Set. The second phase (the “Full Feature Set”) will implement the functionality set forth in Exhibit B to this letter. The Full Feature Set will be available on the Sidekick Zante Danger Device (the “Zante”) at such time such devices commercially launch, and will also be available for delivery as an over-the-air update to Style devices following T-Mobile’s approval.

(iii) Evolution. Upon T-Mobile’s request, Danger will make the MyFaves Application, including all modifications and updates thereto, available on future Danger Devices without additional charge to T-Mobile or to a Manufacturer.

(b) Each of the above phases shall be subject to T-Mobile’s acceptance and shall incorporate reasonable modifications and updates requested by T-Mobile from time to time and agreed to by Danger (such agreement not to be unreasonably withheld). By way of example and not limitation, such modifications may include fine tuning of the MyFaves Application to address results of usability testing.

(c) T-Mobile Deliverables. T-Mobile will provide the items and perform the tasks set forth in Exhibit C to this letter.

2. Development Schedule. The Rich Feature Set and the Full Feature Set will be delivered in time to meet commercial launch timing of the Style and Zante devices, respectively. T-Mobile shall have no obligation to launch such devices without the applicable MyFaves feature sets included on such devices. Danger and T-Mobile acknowledge that each party’s development responsibilities are contingent on the other party fulfilling its development obligations. Neither party shall be in breach of this letter for any delay or failure that results from the delay or failure of the other party and any delivery dates for a particular party shall be equitably extended to compensate for delays or failures of the other party. In addition, no penalties or reductions in amounts to be paid

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1.

shall be made for failures to meet the development schedule unless agreed upon by the parties following execution of this letter.

3. [ * ]. The MyFaves Application shall [ * ]. Danger acknowledges that T-Mobile [ * ]. Danger may [ * ] the MyFaves Application [ * ] in this Section 3. Upon full payment by T-Mobile of the Amounts (as defined below), Danger shall, upon T-Mobile’s request, transfer to T-Mobile [ * ], in a form to be mutually agreed. T-Mobile acknowledges that Danger has made modifications to the existing [ * ] to [ * ] (collectively the “Modifications”) and that [ * ] shall own and be free to use such Modifications to the extent such Modifications do not [ * ] MyFaves Application as provided in this letter agreement. Nothing herein is intended to modify any ownership provisions set forth in the Agreement, including without limitation, those provisions relating to Danger’s [ * ].

4. Confidentiality. The terms and conditions of the Non-Disclosure Agreement pertaining to the My5/MyFaves project are hereby incorporated herein by this reference.

5. Payment. T-Mobile shall pay to Danger amounts (the “Amounts”) set forth in Exhibit D to this letter. Danger shall invoice T-Mobile for the Amounts following the milestones set forth in Exhibit D and T-Mobile shall pay the invoices within thirty (30) days after T-Mobile’s receipt thereof.

This letter shall be governed by the terms of the Master Services Agreement, effective as of June 1, 2006 between Danger and T-Mobile (the “Agreement”). In the event of any conflicts between this letter and such Agreement, this letter shall govern to the extent of the conflict. Capitalized terms not defined herein shall have the meaning set forth in the Agreement

Please indicate your agreement with the terms set forth in this letter by signing below.

Sincerely,

/s/ Henry R. Nothhaft

Henry R. Nothhaft

Chairman & CEO, Danger, Inc.

Agreed on September     , 2006 by

T-MOBILE USA, INC.

By:	/s/ Cole Brodman
	Cole Brodman
	Sr. Vice President and Chief Development Officer

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2.

Exhibit A: Rich Feature Set

[ *]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

3.

Exhibit B: Full Feature Set

[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

4.

Exhibit C: T-Mobile Deliverables

1. Continued access to SMS Server development environment (Newbay Software) from commencement of project.

2. Continued access to T-Mobile SMS Server production environment upon deliver of Beta Release Candidate

3. Full Time Support from T-Mobile and Newbay Software until project completion

4. T-Mobile Logos and Icons

5. Feedback on MyFaves deliverables within 1 week of delivery.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

5.

Exhibit D: Project Cost And Payment Schedule

Project Cost:             $[ * ]

Payment Schedule:

Milestone	Payment
1. Signing of Letter Agreement	$	[ * ]
2. Delivery of Rich Feature Set Test Candidates	$	[ * ]
3. TA of Rich Feature Set on Style/ID	$	[ * ]
4. Earlier of (i) TA of Full Feature Set on Zante or (ii) OTA of Full Feature Set to Style/ID	$	[ * ]
Total	$	[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

6.

November 9, 2006

Warren McNeel

Vice President, Product Development

T-Mobile USA, Inc.

12920 SE 38^th Street

Bellevue, WA 98006

Re: Content Control Development Statement of Work

Dear Warren:

This letter sets forth the agreement between Danger, Inc. (“Danger”) and T-Mobile USA, Inc. (“T-Mobile”) regarding the development and operation of a solution for Danger Devices to restrict access to adult oriented, Internet websites.

This letter shall be part of and governed by the terms of the Master Services Agreement (“Agreement”), effective as of June 1, 2005 between Danger and T-Mobile. In the event of any conflicts between this letter and such Agreement, this letter (including all attached exhibits to the letter) shall govern to the extent of the conflict. Capitalized terms not defined herein shall have the meaning set forth in the Agreement.

1. Definitions.

“Content Control” means the feature Subscribers can elect which restricts web browser access to adult-oriented material, as defined by T-Mobile.

“Content Control Test” means a test which runs continuously and monitors whether selected adult-oriented websites are being correctly filtered.

“Content Control Platform” means a group of servers and associated equipment owned by T-Mobile upon which the Content Control Platform Software operates.

“Content Control Platform Software” means third party software which will query a URL database to determine whether a URL is accessible or non-accessible to Subscribers who elect Content Control.

“Data Center” means the Verizon data center in San Jose, California.

“Integration Proxy” means an application that runs on the Danger System, which interfaces with the T-Mobile Partner Publisher, and handles Subscriber status, passwords, content changes and MSISDNs.

“Partner Publisher” means a T-Mobile application which interfaces with the Integration Proxy and exchanges Subscriber information, including whether a Subscriber has elected Content Control.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

“Verizon” means Verizon Business Financial Management Group (formerly “MCI Communications Services, Inc.”).

2. Scope of Work

A. Danger Obligations.

(i) Integration Proxy development. Danger will modify the Integration Proxy and other related software components which run on the Danger System to read a flag provided by the Partner Publisher that indicates whether a Subscriber has elected Content Control.

(ii) Danger Support Tool development. Danger will modify the Danger Support Tool so that a T-Mobile employee may view or modify, on a per Subscriber basis, a Subscriber’s status regarding their election of Content Control.

(iii) Subscriber traffic routing. Danger will route Subscribers’ web browser traffic based on the Subscriber information provided by T-Mobile via the Partner Publisher or the Danger Support Tool. Specifically, if the Subscriber elects Content Control, then Danger will send the web browser traffic to the Content Control Platform. If the Subscriber does not elect Content Control, Danger will process the web browser traffic as normal and not route the web browser traffic to the Content Control Platform.

(iv) Content Control Test development and operation. Danger will create and operate the Content Control Test.

(v) Operational support. Danger will provide operational support services as set forth in Exhibit A.

(vi) Housing the Content Control Platform. Danger will house the Content Control Platform at the Data Center, provided there is enough equipment storage space and infrastructure services necessary for the Content Control Platform. Danger will provide T-Mobile with reasonable commercial notice if the Content Control Platform is unable to be housed at the Data Center. Following such notice, the parties will mutually agree upon a new location to house the Content Control Platform and new terms for housing the Content Control Platform at a new location.

B. T-Mobile Obligations.

(i) Subscriber Information. Subscriber information provided by T-Mobile to Danger will include all information needed for Content Control, including whether the Subscriber has elected Content Control. The Partner Publisher will push Subscriber information to the Integration Proxy. The Integration Proxy will not actively query T-Mobile for such information. The parties understand that Danger will rely on accurate Subscriber information for Content Control to be effective. T-Mobile shall make its best commercial efforts to deliver accurate Subscriber information. Danger will not be responsible for any failures to comply with its obligations under subsection 2.A (iii) of this letter if Subscriber information is inaccurate.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

(ii) Content Control Platform Software. Residing on the Content Control Platform will be the Content Control Platform Software. T-Mobile is responsible for paying for and obtaining all licenses to use the Content Control Platform Software on the Content Control Platform. T-Mobile (or a third party acting on T-Mobile’s behalf) will install, maintain and update the Content Control Platform Software to ensure the Content Control Platform Software correctly filters traffic. For avoidance of doubt, Danger will have no obligation to install, maintain or update the Content Control Platform Software.

(iii) Content Control Platform. T-Mobile is responsible for purchasing and supplying the Content Control Platform. T-Mobile will establish and ensure adequate capacity for, but not limited to, the Content Control Platform Software and other components necessarily residing on the Content Control Platform.

(iv) Operational Support. T-Mobile will provide operational support services as set forth in Exhibit A.

3. VPN connection. The parties will work together to maintain a continuous VPN (or subsequently T1 dedicated line) connection with suitable architecture and alarming. Danger will use the VPN connection in connection with performing its Tier 1 obligations as set forth in Exhibit A. The VPN connection will also be used to allow T-Mobile to maintain and repair Tier 2 related problems with the Content Control Platform.

4. Danger Devices Supported. At the time of commercial launch of Content Control, the Danger Devices known as the Sidekick II and the Sidekick3 will support Content Control. All future Danger Devices will be supported.

5. Ownership. T-Mobile acknowledges that Danger will make modifications to the Integration Proxy and other components on the Danger System and that Danger shall retains all rights, title and interest in and to such modifications. As between Danger and T-Mobile, T-Mobile and/or its licensors and service partners own the Content Control Platform.

6. Service Levels. Danger and T-Mobile will adhere to the response times and perform the tasks set forth in Exhibit A to this letter.

7. Schedule. The schedule for development, certification, testing and launch is set forth in Exhibit B to this letter. Danger and T-Mobile acknowledge that each party’s responsibilities are contingent on the other party fulfilling its obligations. Neither party shall be in breach of this letter for any delay or failure that results from the delay or failure of the other party, and any delivery dates for a particular party shall be equitably extended to compensate for delays or failures of the other party. In addition, no penalties or reductions in amounts to be paid shall be made for failures to meet the development and launch schedule unless mutually agreed upon in writing by the parties following execution of this letter.

8. Payment. T-Mobile shall pay the amounts set forth in Exhibit C upon the earlier of (i) T-Mobile’s acceptance of the deliverables outlined in 2.A (i), (ii), (iii) and (iv),

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

such acceptance not to be unreasonably withheld; or (ii) by the date of first commercial launch of Content Control. No further payment shall be required in the event any development is necessary to enable Content Control for the Prepaid Danger Service.

9. Disclaimer. T-Mobile acknowledges that technical problems or failures may occur from time to time, and that Subscribers who elect Content Control may be able to access Internet websites that would have been blocked or restricted absent such problems or failures. Danger will use reasonable commercial efforts to prevent such problems or failures, but Danger does not represent, warrant or guarantee that implementation of Content Control on the Danger System will be error-free. Nothing herein is intended to modify any disclaimer or warranty provisions set forth in the Agreement.

Please indicate your agreement with the terms set forth in this letter by signing below.

Sincerely,

/s/ Henry R. Nothhaft

Henry R. Nothhaft

Chairman & CEO, Danger, Inc.

Agreed on                         , 2006 by

T-MOBILE USA, INC.
By:	/s/ Warren McNeel
	Warren McNeel
	Vice President, Product Development

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EXHIBIT A

• T-Mobile shall be responsible for all Tier 1 monitoring of the Content Control Platform and Content Control Platform Software.

• Current exceptions are listed in the table below.

• The parties may mutually agree at a later date for some Danger monitoring of the Content Control Platform and/or the Content Control Platform Software, such agreement to be in writing and signed by both parties.

• Tier 1 problems shall be escalated to T-Mobile Tier 2 support as necessary, by T-Mobile Tier 1.

• Danger, if applicable, shall escalate issues to T-Mobile Tier 1 as indicated in the table below.

• T-Mobile shall be solely responsible for all Tier 2 monitoring.

Tier 1 Roles

	Issue	Solution
1	Who will monitor the Content Control Platform and the Content Control Platform Software?	T-Mobile will monitor the Content Control Platform and Content Control Platform Software in an identical fashion to the way they monitor Content Control for their general customer base. In addition, however, Danger will create and operate the Content Control Test.
2	Who performs alarming, and for what?	Danger will monitor connections and traffic up to the load balancer associated with the Content Control Platform. Danger will alarm for tests as described in #1 above, and will contact T-Mobile’s NOC (Tier 1) immediately upon determining that incorrect results are being returned.
3	Who will undertake the first level of trouble shooting with regard to content issues that are escalated from T-Mobile to ensure that the issue is not related to other Danger network applications?	Danger will undertake troubleshooting of all elements except the Content Control Platform and the Content Control Platform Software itself, which is the sole responsibility of T-Mobile. In the event that Danger identifies an issue with its browsing platform, Danger will report the issue to T-Mobile and its resolution for tracking purposes. Danger will remind the T-Mobile NOC that they may be seeing alerts on T-Mobile’s content filtering monitoring solution, in the event such an issue arises. In the event T-Mobile identifies trouble with the Content Control Platform, T-Mobile will report the issue to the Danger NOC, and T-Mobile Tier 1 will either resolve directly or escalate to T-Mobile Tier 2, as appropriate. NOTE: Either side will notify the other of planned maintenances, consistent with existing practices, to prevent wasted troubleshooting efforts.
4	Who will respond to Tier 1 Alerts?	As described above.
5	Who will escalate to Tier 2 for trouble resolution, and who will handle Tier 2 problems?	T-Mobile will be handling Tier 2. T-Mobile will escalate to Tier 2 in the identical fashion that they escalate for their primary solution.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

6	Who may call for troubleshooting conference bridges to be opened as appropriate?	Either party may call for a troubleshooting bridge to be opened.
7	How will application support VPN access to the Content Control Platform work?	T-Mobile and Danger will maintain a VPN (or subsequently a T1) connection that is kept up and running continuously, with suitable architecture and alarming to ensure uptime of the connection.

Management of On-site/Remote Tier1 Technical Services

	Issue	Solution
1	Who troubleshoots network components or call flow issues?	Danger will be responsible for the edge—from the cross connects to the F5.
2	Who provides routine connectivity and power verification?	Danger will perform this function
3	Who identifies physical issues, and who repairs them?	T-Mobile expects it will be able to find these issues in most cases with remote diagnostics; Danger will provide physical remote-hands support as needed.
4	Who perform hard reboots?	T-Mobile will have the ability to do this remotely as needed; if this fails Danger will provide physical remote-hands support
5	Who replaces subassemblies?	Danger will do this generally on a next business day basis, unless business need indicates greater urgency.
6	Who handles onsite preventive and routine maintenance?	If this is needed Danger can provide such maintenance with guidance from T-Mobile.
7	Who will provide emergency 24x7x365 on-site support?	Danger will provide as needed
8	Who will provide RMA support?	Danger will do this generally on a next business day basis, unless business need indicates greater urgency.
9	Who will facilitate application support data center access 24x7x365 in event of emergency?	Danger will facilitate this if it is needed
10	Who will facilitate hardware vendor data center access 24x7x365 in event of emergency?	Danger will facilitate this if it is needed

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Tier 2 Escalation

In the event that Danger needs to escalate to T-Mobile, the following section lays out the methods. Initially, the most likely trigger for an escalation will be the failure of Danger’s Content Control Test. Additionally, as stated earlier, Danger will notify T-Mobile whenever there is an issue with the Danger Service to avoid wasted troubleshooting by T-Mobile.

When applicable, Danger shall escalate to the T-Mobile designated (Tier 1) support team. Danger shall provide at a minimum the following:

1. Caller Name

2. Call back number

3. Trouble ticket number

4. Severity of trouble ticket

5. Description of trouble, alarms, test results, etc.

6. Corrective actions taken by Danger

7. Assist with VPN access if needed

SLA – Time to respond to a network incident:

[ * ]

Tier 2 Roles

T-Mobile shall be solely responsible for all Tier 2 operational support roles.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Exhibit B

SCHEDULE

ITEM	DATE
Implementation architecture finalized	07/14/06
Design requirements finalized	08/18/06
Danger software feature complete	08/15/06
Danger/T-Mobile Danger Support Tool testing	09/18/06
Danger/T-Mobile enterprise end to end testing (T-Mobile lab to Danger lab-trial using pre-production Content Control system)	10/31/06
T-Mobile approves production system	11/08/06
T-Mobile launch of content filtering for post-pay users	11/11/06

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Exhibit C

[ * ]

If, 12 months following launch of Content Control, separate hosting capacity (e.g. racks, power, etc.) in the Danger Data Center collocation facility is still required for the Content Control Platform, T-Mobile shall reimburse Danger for Danger’s actual out-of-pocket costs for such capacity. Danger will invoice T-Mobile for such costs on a monthly basis, and T-Mobile will pay no later than 30 days following receipt of invoice.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

July 17, 2007

Cole Brodman

Sr. Vice President Systems & Product Development

T-Mobile USA, Inc.

12920 SE 38^th Street

Bellevue, WA 98006

Re: Service Level Monitoring and Reporting Project (SELMAR)

Dear Cole:

This letter sets forth the agreement between Danger, Inc. (“Danger”) and T-Mobile USA, Inc. (“T-Mobile”) regarding the development and operation of the Service Level Monitoring and Reporting project (“SELMAR”) for T-Mobile’s observation of various services on the Danger System.

This letter shall be part of and governed by the terms of the Master Services Agreement (“Agreement”), effective as of June 1, 2005 between Danger and T-Mobile. In the event of any conflicts between this letter and such Agreement, this letter (including all attached exhibits to the letter) shall govern to the extent of the conflict. Capitalized terms not defined herein shall have the meaning set forth in the Agreement.

1. Scope of Work.

(a) Functional Specification. The agreed upon specification for SELMAR is set forth in Exhibit A (the “Specification”). The parties understand that the UI design, charts and data used in Exhibit A are not actual screen shots, but are illustrations of how the service reports and service monitoring screens may look upon completion of SELMAR.

(b) Danger Responsibilities. Danger will implement and maintain SELMAR as described in the Specification.

(c) T-Mobile Responsibilities. T-Mobile shall appoint an employee to maintain a list of T-Mobile personnel entitled to access SELMAR. T-Mobile shall provide Danger with the list of persons entitled to access SELMAR and updates to that list as persons are added/deleted. As part of such list, T-Mobile shall designate the IP Addresses from which such persons will be accessing SELMAR.

2. Development Schedule. As set forth in Section 6.10 of Exhibit B of the Agreement, if Danger has not implemented SELMAR by August 11, 2007, then the monthly Service Fees will be reduced [ * ] until SELMAR has been implemented. The parties agree that no other penalties or reductions in amounts to be paid shall be made for failures to meet the August 11, 2007 schedule unless agreed upon by the parties following execution of this letter.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1.

3. Confidentiality/Ownership. T-Mobile acknowledges that SELMAR will provide access to sensitive data and insight into components of the Danger System which are confidential to Danger and may not be disclosed to any third party without Danger’s prior consent. Danger shall own all right, title and interest in SELMAR and any modifications and derivative works thereto.

4. Payment. T-Mobile shall pay to Danger $[ * ] in non-recurring engineering expenses, as detailed in Exhibit B to this letter, (the “Amounts”) in accordance with the following milestones: (a) [ * ]% upon signing of this letter and (b) [ * ]% on acceptance of the SELMAR deliverables set forth in the Specification. The payment for each milestone shall be non-refundable once the milestone is completed. Danger shall invoice T-Mobile for the Amounts following the completion of each milestone and T-Mobile shall pay the invoices within thirty (30) days after T-Mobile’s receipt thereof.

5. Ongoing Costs. Unless otherwise agree to by the parties, Danger’s costs to operate and maintain SELMAR following launch shall be borne by Danger.

Please indicate your agreement with the terms set forth in this letter by signing below.

Sincerely,

/s/ Henry R. Nothhaft

Henry R. Nothhaft

Chairman & CEO, Danger, Inc.

Agreed on                         , 2007 by

T-MOBILE USA, INC.

By:	/s/ Cole Brodman
	(signature)
Name:	Cole J. Brodman
Title:	SVP Product Development

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2.

Exhibit A

See Attached

[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

3.

Exhibit B

[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

4.

SECOND AMENDMENT TO

MASTER SERVICES AGREEMENT

(MYSPACE)

This Second Amendment (“Amendment”) is entered into and effective as of the later of the two dates below the signature lines (“Amendment Effective Date”) by and between T-Mobile USA, Inc., (“T-Mobile”) and Danger, Inc. (“Danger”), and amends that certain Master Services Agreement, dated and effective as of June 1, 2005, between T-Mobile and Danger (as amended, the “Agreement”).

BACKGROUND

WHEREAS, the Agreement contains terms and conditions under which the parties deliver Premium Content to Subscribers via the Premium Download Manager;

WHEREAS, the parties desire to amend the Agreement to address the terms and conditions that will apply to the development and deployment of the SK Application (as defined below) and the provision of MySpace Services (as defined below) to Subscribers.

NOW, THEREFORE, in consideration of the mutual covenants and representations contained herein and in the Agreement, the parties hereby agree to amend the Agreement as follows:

AMENDMENT

I. Effect of Amendment. This Amendment amends the Agreement. Except as provided herein, all of the terms and conditions of the Agreement remain in full force and effect; however, if there is a conflict between the terms of this Amendment and the Agreement, the terms of this Amendment shall govern. All capitalized terms used in this Amendment and not otherwise defined in this Amendment shall have the meanings ascribed to them in the Agreement.

II. Definitions.

“SK Application” means the software application that enables the Danger Devices commonly referred to as Sidekick2, Sidekick 3, Sidekick ID, Sidekick Slide and Sidekick LX (the “Initial Devices”) to access the MySpace Service with the features and functionality described in Appendix A, including all minor releases and bug fixes thereto if and when Danger makes them available pursuant to Danger’s support obligations under this Amendment. Upon written agreement by the parties to port the SK Application to additional devices or release an upgrade or new version of the application, such upgrade or new version will be part of the definition of “SK Application” under this Amendment for all purposes other than pricing under Appendix B (unless otherwise mutually agreed by the parties). Except for Section 4 of Exhibit D to the Agreement, the SK Application will be treated as Danger Premium Content.

“MySpace” means MySpace, Inc. a Delaware corporation with offices in Beverly Hills, California.

“MySpace Service” means the online social networking community service owned and operated by MySpace, Inc. at www.myspace.com under the “MySpace” brand.

“Danger MySpace Service” means enabling of Subscriber access to some features and content of the MySpace Service and the transmission of data to and from the MySpace Service and

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement Confidential

Subscribers’ Danger Devices. The Danger MySpace Service is Danger Premium Content under the terms of the Agreement.

III. Development and Testing of the SK Application. At Danger’s sole cost, Danger will develop the SK Application in accordance with the delivery schedule and specifications attached hereto in Appendix A.

IV. Rights from MySpace.

A. Danger. Danger warrants that it has entered into entered into a separate agreement with MySpace under which Danger (i) has obtained access to certain MySpace API documentation; (ii) has obtained the rights to develop the SK Application for distribution to T-Mobile and Subscribers (iii) has established a process with MySpace to receive changes to the MySpace API documentation so that Danger may update the SK Application and the Danger MySpace Service as may be required from time to time to remain in compliance with the specification set forth in Appendix A and to maintain the interoperability between Danger’s systems that host the Danger MySpace Service and MySpace’s systems that host the MySpace Service. If T-Mobile receives updated MySpace API documentation that Danger does not receive, T-Mobile may provide such documentation to Danger and such API documentation shall be considered confidential information subject to Section 14.1 of the Agreement and used only to maintain interoperability for the SK Application and the Danger MySpace Service.

B. T-Mobile. T-Mobile warrants that it has entered into a separate agreement with MySpace and obtained the rights for Danger and T-Mobile to permit Subscribers to access the MySpace Service via the SK Application.

C. No Warranties for the MySpace Service. Neither party makes any representation or warranty to the other regarding the MySpace Service and neither party shall have any obligation to indemnify the other for issues arising out of the MySpace Service, including but not limited to the content or material posted on or made available through the MySpace Service. T-Mobile acknowledges that Danger has no obligation to monitor or censure the content or material accessed or transmitted by Subscribers through the MySpace Service.

V. Acceptance of SK Application. T-Mobile hereby accepts SK Application v1.0 for the Sidekick 2, the Sidekick 3 and the Sidekick ID Danger Devices. Prior to the commercial launch of the SK Application on any additional Danger Devices, the following schedule for acceptance and correction of any problems with the SK Application shall be used (unless agreed otherwise by the parties): T-Mobile shall have thirty (30) days following delivery of the applicable SK Application to evaluate and submit a written notice of acceptance or rejection to Danger. T-Mobile may reject all or any portion of a deliverable if it does not conform to the Specifications set forth in Appendix A; Danger’s written guarantees, representations, and warranties; applicable regulatory rules and other federal state, and local legal requirements; or the Content Certification Plan. If T-Mobile rejects a deliverable or any portion thereof, Danger will correct it within a mutually agreeable time period (that will not exceed thirty (30) days). If Danger fails to correct any errors in a SK Application within a time period mutually agreed to by the parties (not to exceed thirty (30) days), T-Mobile may (a) accept the non-conforming SK Application deliverable and continue under this Amendment (without waiving its rights to reject other SK Application deliverables); (b) extend the correction period; or (c) reject the non-confirming SK Application. Notwithstanding the foregoing, T-Mobile’s commercial launch of the SK Application on any Danger Device shall constitute its acceptance of the SK Application for such Danger Device. If, per Appendix B, the parties mutually agree on the terms to distribute a new Major Releases of the SK Application or to distribute the SK Application on other Danger Devices, the parties shall also agree to a

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement 2. Confidential

schedule for acceptance and correction of problems prior to such distribution. Notwithstanding the foregoing, T-Mobile shall be under no obligation to launch the SK Application on any Danger Device.

A. Connectivity and Deployment. Danger will work with T-Mobile and MySpace to connect Danger’s servers with the servers of MySpace in order to provide the Danger MySpace Service.

B. Deployment Plans. Danger and T-Mobile will mutually agree upon the timing for deploying the SK Application to each of the Initial Device models. The parties will work together and with MySpace (as necessary) to manage a successful deployment of the SK Application on the Initial Devices.

VI. Operation and Maintenance.

A. Requirements. Danger agrees that the SK Application and the Danger MySpace Services will comply with the specifications set forth in Appendix A, including the Danger MySpace Service’s interoperability with the systems that host the MySpace Service. In addition, the parties agree that, except as otherwise set forth in this Amendment, the SK Application and the Danger MySpace Service will comply with the requirements for Danger Premium Content, as set forth in the Agreement.

B. Service Level Agreements. For issues related to the SK Application or the Danger MySpace Service, Danger and T-Mobile will follow the Escalation Procedure set forth in Section 2 of the Service Level Agreement described in Exhibit B to the Agreement. Danger warrants to T-Mobile that Danger has an incident management and service restoration process in place with MySpace to manage escalation and resolution of issues.

C. Suspension and Disabling of Danger MySpace Service. Promptly upon notice from T-Mobile (but no less than one (1) calendar day) during the Term, Danger will (a) block access of an individual Subscriber to the MySpace Service via the SK Application by suspending or disabling his/her Danger Service account; and/or (b) block access to the MySpace Service via the SK Application to all Subscribers (including disabling the download of the SK Application from the PDM).

D. Maintenance of SK Application. Danger may not distribute new versions of the SK Application (including by offering Upgrades and Enhancements to prior versions) for use by Subscribers without T-Mobile’s prior written approval. Such approval may be conditioned on Danger’s agreement to an amendment to the Agreement with additional terms and conditions. Any approved modifications to the SK Application will be subject to acceptance testing by T-Mobile in accordance with Section V, above. In no event will Company modify the Danger MySpace Services or SK Application to enable the distribution of applications or audio or visual content (including but not limited to ring tones and wallpaper) to Subscribers. Notwithstanding the foregoing, Danger may, without T-Mobile’s prior written approval, distribute bug fixes for the SK Application and implement changes to the Danger MySpace Service that do not materially change the functionality of the SK Application. Any bug fix or change that affects the user experience is a material change.

E. User Agreement: Danger will, within the download process for the SK Application require Subscribers to agree that downloading the SK Applications and/or accessing the MySpace Services is subject to the Danger Service and End-User License Agreement that includes disclaimers of warranty and limitations on liability that are substantially the same as those contained in the form end user agreement set forth in Exhibit G of the Agreement.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement 3. Confidential

F. Reporting. Within ten (10) business days of the end of each calendar month, Danger will provide T-Mobile reports in accordance with Appendix C.

G. Subscriber Charges. T-Mobile may charge Subscribers for use of the SK Application, Danger MySpace Service and MySpace Service. Danger will not impose any charges on Subscribers for their access to or use of the SK Application, Danger MySpace Service or MySpace Service. For the avoidance of doubt, if Danger imposes a charge on Subscribers at the request of and on behalf of T-Mobile, such charge is not a violation of this Section.

H. Advertising. Danger will not include any advertisement or promotions in the SK Application or cause any advertisements or promotions to display prior to the download, installation or execution of the SK Application. T-Mobile acknowledges that Danger has no control and is not responsible for advertisements or promotions that appear in the content and material transmitted to and from the MySpace Service.

I. Harmful Code. Danger will use commercially reasonable efforts to prevent Harmful Code from entering the MySpace systems that host the MySpace Service through Danger’s connection to MySpace. “Harmful Code” means (a) unauthorized data, viruses, worms or other malicious code; (b) any feature that prevents or interrupts the use of the MySpace Service, including but not limited to any lock, drop-dead device, Trojan-horse routine, trap door, time bomb; or (c) any other code or instruction that is intended to be used to access, modify, delete, damage, or disable the functionality of the MySpace Service. Danger will promptly notify MySpace and T-Mobile if it knows of any Harmful Code that has entered the MySpace Service through Danger’s connection to MySpace and remedy such incident in accordance with the incident management process agreed upon between Danger and MySpace.

VII. Licenses.

A. Application License. Subject to the terms and conditions of this Amendment, Danger grants to T-Mobile a limited, non-exclusive (except as set forth in Section VII(B) below), fee-bearing, license for T-Mobile to (a) use, publicly display and publicly perform the SK Application on the Initial Devices in order to evaluate, test, demonstrate, support, market and promote the SK Application, Initial Devices and the MySpace Service and (b) distribute (through multiple channels) the SK Application on Initial Devices.

B. Source Escrow. Pursuant to Section 13 of the Agreement, Danger shall place into escrow the Source Code, object code and related documentation for the Danger Service software that supports the Danger MySpace Service. Such Danger Service software shall be treated as “Escrowed Code” pursuant to Section 13 of the Agreement. Subject to the written consent and any conditions imposed by MySpace, for the purposes of Section 13.4 of the Agreement, the SK Application will be considered Danger Software.

C. [ * ]. Subject to the terms and conditions of this Amendment, [ * ].

D. Reservation of Rights. Except as expressly set forth in Sections VII(A) and (B) nothing in this Agreement will be deemed to (i) transfer or license any rights in or ownership of the SK Applications to T-Mobile; or (ii) the MySpace Services to Company.

E. Term/Termination. Either party may terminate this Amendment on thirty (30) days prior written notice to the other party if the other party has materially breached its obligations under this Amendment and has failed to cure the breach within the notice period. Unless terminated as

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement 4. Confidential

set forth in the preceding sentence, this Amendment will have the same Term as the Agreement and will terminate when the Agreement terminates.

F. Survival. The parties acknowledge and agree that copies of the SK Application sold or licensed to Subscribers prior to the expiation or termination of this Agreement survive such termination or expiration and the SK Application will not be removed from Danger Devices even if the Danger MySpace Service is no longer being provided. The pricing and fees set forth in Exhibit B shall survive the term of the Agreement for the Initial Devices and any other Danger Devices for which the parties agreed (during the term of this Amendment) to distribute the SK Application v1.0. For the avoidance of doubt regarding the preceding sentence, if the Agreement terminates and the parties enter into another agreement for the supply of the Danger Services to T-Mobile, the SK Application will be provided to T-Mobile for the Initial Devices and any other Danger Devices for which the parties agree (during the term of this Amendment) to distribute the SK Application v1.0 on the same financial terms and the amounts paid under this Agreement shall be applied to such new agreement as applicable (e.g., if T-Mobile has paid $[ * ] in License Fees, T-Mobile shall only be required to pay an additional $[ * ] in License Fees pursuant to Section 2 of Exhibit B).

G. Payment. Fees for MySpace Services and the SK Application and reporting and billing administration for SK Applications are set forth in Appendix B to the Amendment.

VIII. Entire Amendment. This Amendment and the Agreement constitute the entire agreement between the parties with respect to the subject matter hereof and merge all prior and contemporaneous communications. They shall not be further modified except by a written agreement dated subsequent to the Amendment Effective Date and signed on behalf of T-Mobile and Danger.

IN WITNESS WHEREOF, the parties have entered into this Amendment as later of the two dates below.

T-Mobile USA, Inc. (“T-Mobile”)		Danger, Inc. (“Danger”)
/s/ Joe Sims		/s/ Henry R. Nothhaft
By	(signature)	By	(signature)
Name	Joe Sims	Name	Henry R. Nothhaft
Title	VP & General Manager, New Business Development	Title	Chairman & CEO
Date	August 30, 2007	Date	August 30, 2007

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement 5. Confidential

Appendix A

Specifications: Myspace “Sk Application” Version 1.0

Version 1.0 of the SK Application supports the features listed below. Delivery of these features requires the MySpace Service to provide content via the Danger MySpace Service to the SK Application. The screen shots in the attached product description were created for illustration purposes and are not the same as what appears in SK Application v1.0.

See Attached Product Description

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement 6. Confidential

Appendix B

SK Application License Fees

1. Definitions.

1.1 MySpace Active Subscriber” means a Subscriber (as identified by a unique Danger User ID) that has logged into the MySpace Service (by entering a user name and password) via a SK Application at least one (1) time in a month and initiated three (3) or more Transactions in the month.

1.2 “Transaction” may be one of the following activities: (a) Send Message; (b) Read Message; (c) View Profile (other than the Subscriber’s own profile); (d) Send Friend Request; (e) Post Comment and (f) Send Bulletin. Danger will not engage in activities designed to encourage Subscribers to engage in Transactions (e.g., sending Subscribers administrative or other messages that instruct Subscribers to engage in the activities listed in subsections (a)-(f) above).

2. License Fee. T-Mobile will pay Danger [ * ] for the SK Application [ * ] to be paid in accordance with the table below based on the number of MySpace Active Subscribers (the “License Fee”). Each License Fee “tranche” represents a one-time payment that Danger will invoice following the time the applicable MySpace Active Subscriber level is reached.

License Fee Table

$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers;
$[ * ] when there are [ * ]	MySpace Active Subscribers; and
$[ * ] when there are [ * ]	MySpace Active Subscribers.

3. Pricing Change. The parties anticipate the fees in Section 2 above to apply at the commercial launch of the SK Application if [ * ] the MySpace Service via the SK Application. This Section 3 is intended to apply if T-Mobile [ * ] the MySpace Service via the SK Application upon commercial launch or in the event T-Mobile [ * ] sometime after commercial launch of the SK Application. If T-Mobile [ * ] the SK Application [ * ] the MySpace Service, then Danger shall have the option to [ * ] the SK Application to access the MySpace Service. If for any period of time T-Mobile does not [ * ] the MySpace Service and then [ * ] the MySpace Service, T-Mobile shall provide Danger with at least forty-five (45) days’ written notice prior to such pricing change. Following T-Mobile’s notice of a pricing change, Danger must notify T-Mobile in writing if it plans to exercise its option under this Section at least fifteen (15) days prior to the date T-Mobile’s pricing change will take effect. If T-Mobile plans [ * ], Danger will notify T-Mobile in writing if it plans to exercise its option under this Section no later than thirty (30) days following commercial launch. Fees under this Section 3 will apply for all Subscribers [ * ] and shall be calculated and invoiced in accordance with Exhibit D of the Agreement (as amended) on a going forward basis once T-Mobile [ * ] and Danger has provided the notice required by this Section. If Danger elects to receive fees under this Section 3, the Licensee Fees table in Section 2 above shall no longer apply, but any License Fees prepaid or invoiced prior to Danger’s election will be deemed earned

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement 7. Confidential

and non-refundable regardless of the [ * ]. Notwithstanding the foregoing, if T-Mobile has paid Danger [ * ] Dollars ($[ * ]) under Section 2 and T-Mobile subsequently [ * ] the SK Application to access the MySpace Service, then the [ * ] (i.e. Danger will [ * ]). In addition, if T-Mobile switches its pricing model for the MySpace Service [ * ], then at the time of such changes the fees under Section 2 shall apply instead of the [ * ] under this Section 3 and all amounts already paid under this Section 3 will be applied. For example if T-Mobile has already paid Danger [ * ] Dollars ($[ * ]) under this Section 3, then T-Mobile will only be required to pay an additional [ * ] Dollars ($[ * ]) in License Fees under Section 2. If T-Mobile chooses a pricing model for the SK Application and/or MySpace Service other than [ * ], then the parties shall mutually agree on the economics of such arrangement prior to T-Mobile’s change to such alternative pricing model. If Danger elects to receive fees under this Section 3, the parties will agree to additional service level metrics (e.g,. uptime, etc.) for the SK Application as well as remedies that will apply in the event the SK Application or Danger MySpace Service are unavailable or are not functioning properly.

4. Prepayment. Danger will invoice T-Mobile for a non-refundable $[ * ] prepayment of the License Fees following the execution of this Amendment. This prepayment will be applied against the amounts due in the table above.

5. Payment Terms. T-Mobile will pay License Fees due per the table above within thirty (30) days of receipt of Danger’s invoice.

6. New Versions. If the parties mutually agree upon and Danger develops and licenses to T-Mobile a new version of the SK Application (e.g., version 2.0), then the parties will mutually agree upon additional payments for such new version or Danger Device. If the parties mutually agree to distribute Version 1.0 of the SK Application to Danger Devices other than the Initial Devices, the economics set forth in Sections 2 and 3 of this Agreement shall apply. If the porting of the SK Application to a new Danger Device requires development efforts by Danger that are significantly greater than porting of the SK Application from the Sidekick ID to the Sidekick 3, then the parties will mutually agree upon a reasonable porting fee to compensate Danger for the additional efforts required to port the SK Application to such Danger Device.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement 8. Confidential

Appendix C

Reporting

Danger will report to T-Mobile the following on a monthly basis. Each of the following items will be based on activity in the calendar month most recently ended. This report will be delivered within ten (10) business days after the end of each calendar month:

[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Amendment to Master Services Agreement 9. Confidential

THIRD AMENDMENT TO

MASTER SERVICES AGREEMENT

(AMENDED AND RESTATED EXHIBIT D: PREMIUM CONTENT)

This Third Amendment (“Amendment”) is entered into and effective December 1, 2007 (“Amendment Effective Date”) by and between T-Mobile USA, Inc., (“T-Mobile”) and Danger, Inc. (“Danger”), and amends and restates Exhibit D: Premium Content of that certain Master Services Agreement, dated and effective as of June 1, 2005, between T-Mobile and Danger (as amended, the “Agreement”).

WHEREAS, T-Mobile and Danger intend to change the process through which the parties collaborate in selecting, licensing, testing, and certifying Applications (networked and non-networked), Themes and Backgrounds Images;

WHEREAS, Exhibit D of the Agreement currently outlines the processes for selecting, licensing, testing, certifying and publishing all Premium Content. As of the Amendment Effective Date, the existing Exhibit D of the Agreement is terminated and the terms of this Amendment will govern such processes for all Premium Content; and.

WHEREAS, The pricing for Premium Content is currently set forth in Exhibit D and the Themes and Subscription Pricing Amendment entered into by and between the parties on

June 6, 2007 (“Amendment #1”). As of the Amendment Effective Date, Amendment #1 is terminated and the pricing for the terms of this Amendment will govern the pricing for all Premium Content.

NOW, THEREFORE, in consideration of the mutual covenants and representations contained herein and in the Agreement, the parties hereby agree as follows:

I. Effect of Amendment. This Amendment amends and restates Exhibit D: Premium Content of the Agreement and terminates and supersedes Amendment #1. Except as provided herein, all of the terms and conditions of the Agreement remain in full force and effect; however, if there is a conflict between the terms of this Amendment and the Agreement, the terms of this Amendment shall govern. All capitalized terms used in this Amendment and not otherwise defined in this Amendment shall have the meanings ascribed to them in the Agreement.

II. Definitions.

a. “Application” means a Premium Content software application (e.g. a game or utility program).

b. “Average Network Usage Per User” means the average amount of data transmitted by users to and from a Danger Device in connection with the use of a particular Application in a particular month (excluding data which the Application may send or receive in connection with the use of the Danger Software’s email functionality).

c. “Backend Revenues” means revenues received by Danger from a third party (other than Subscribers) in connection with any Danger Sourced Content or promotional activity involving other Danger Services (e.g., fees for distribution, bounty for new accounts, affiliate fees for transactions, paid search results, advertising, etc.).

1.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

d. “Background” means a Premium Content bundle consisting of two (2) Background Images that are configured to display on the “top level” and “secondary” screens of a Danger Device.

e. “Background Image” means a graphical image or design (other than Graphical Elements) formatted for display on the entire background of the screen of a Danger Device.

f. “Certain Premium Content” means Themes, Backgrounds, and Applications.

g. “Danger Sourced” means Premium Content licensed by Danger for distribution through the Premium Download Manager.

h. “Premium” means a pricing designation that is made by T-Mobile and provided to Danger in writing in accordance with the terms of this Amendment. The parties anticipate that the Premium designation will be applied to branded Certain Premium Content as well as certain other Certain Premium Content from cross-platform mobile providers ([ * ]). On a case-by-case basis, T-Mobile may agree to designate as Premium certain Applications that are non-branded but happened to be innovative and uniquely leverage the Danger Device platform.

i. “Splash Screen” means a promotional image hosted by Danger that is displayed on a Subscriber’s Danger Device when the Subscriber accesses the Premium Download Manager.

j. “Standard” means the default pricing designation for all Content that T-Mobile does not designate as Premium in accordance with the terms of this Amendment.

k. “Theme” means a Premium Content bundle that includes two (2) Background Images and additional audio and visual elements, including icon chooser wheel enhancements and sounds that are coordinated with the Background Images.

l. “T-Mobile Sourced” means Premium Content licensed by T-Mobile for distribution through the Premium Download Manager.

III. Danger Responsibilities. Danger shall have the following responsibilities with respect to Certain Premium Content:

A. Hosting. Danger shall provide the hosting services for Premium Content on the Danger System and makes the Premium Content accessible through the Premium Download Manager, which consists of both server-based and device software.

B. Developer Program. Danger shall be responsible for developer support for all Premium Content. Without limiting the generality of the foregoing, Danger shall operate a developer program, at http://developer.danger.com, through which Danger shall make a software development kit (“SDK”) and documentation available for download to potential third-party developers of Premium Content. Danger shall use commercially reasonable efforts to regularly publish updates to the SDK and provide reasonable technical support to third-party developers of Premium Content (including but not limited to direct access to Danger QA team by phone to clarify questions regarding bugs reported against specific titles). Danger shall use commercially reasonable efforts to provide “high priority” providers direct access to Danger Developer support engineers to assist with development questions. Danger will not charge T-Mobile or developers designated by T-Mobile any fees for access to the developer program or to license the SDK. The SDK and Danger online support information will contain discussion forums and sufficient information for a developer of reasonable skill to develop Premium Content (including certification criteria, test cases, porting guides). Danger will hold periodic developer conferences

2.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

and manage “early access” and porting programs for new Danger Device releases, when and if such releases become available. Danger will provide each developer with at least two (2) status reports at the frequency and with the information indicated below:

(i) Bi-Weekly Testing Update. This includes the following status views for a provider’s titles, a sample document has been provided to T-Mobile and is dated August 17, 2007(the format of which T-Mobile and Danger may mutually agree to update from time to time):

(1) Applications queued for testing

(2) Applications in active QA

(3) Applications currently with the content provider for bug fixes

(4) Applications certified for launch

(ii) Monthly Launched Content Updates. This includes the following status views for a provider’s titles, a sample document has been provided to T-Mobile and is dated August 17, 2007 (the format of which T-Mobile and Danger may mutually agree to update from time to time):

(1) Content live by Danger Device

(2) Launched content pricing

C. Certification of Certain Premium Content.

(i) Danger will be responsible for certification of all Certain Premium Content. Danger will follow the process outlined in Appendix C with respect to all Premium Content other than Applications. Danger will create, maintain, and deliver to T-Mobile on a bi-weekly basis a certification status document in the format provided to T-Mobile and dated (which T-Mobile and Danger may mutually agree to update from time to time) with the following information for Applications: Applications grouped by provider, Applications by device(s); Applications queued for testing; Applications in active QA; Applications currently with the content provider for bug fixes; Applications certified for launch; current priorities of all Applications; and flags to easily identify new Applications that have been added to the list (“Certification Status Document”). Upon submission to Danger of all proposed Certain Premium Content by a third-party developer (or completion of Danger’s development if developed by Danger), Danger shall perform the testing and certification activities set forth in the “Danger Baseline Application Acceptance Criteria” document (hereinafter, the “Content Certification Plan”), a copy of which has been supplied by Danger to T-Mobile, and which may be amended by Danger, in its reasonable discretion, from time to time. If Danger amends the Content Certification Plan, Danger will use commercially reasonable efforts to notify T-Mobile of any such amendment at least thirty (30) days prior to the effective date of such amendment. If T-Mobile reasonably believes that an amendment will negatively impact developers, Danger will modify the amendment to eliminate the negative impact, unless modifying the amendment is not commercially or technically feasible in which case the parties will work together in good faith to resolve the issue. If Danger discovers any bugs or errors in the proposed Certain Premium Content submitted by a third-party developer, Danger will report such problems to the third-party developer and will work with the third-party developer to correct such errors.

(ii) Danger will manage the certification process for all Certain Premium Content so that initial testing of titles designated by T-Mobile as “high priority” will have a targeted date to complete initial testing (“Target Date”) within [ * ] business days following submission and a Target Date for follow-up testing within [ * ] business days following

3.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

resubmission. The parties acknowledge that Danger can only support the foregoing testing timeline for [ * ] “high priority” titles at a time. If T-Mobile designates more than [ * ] titles as “high priority,” Danger will notify T-Mobile and T-Mobile will indicate which [ * ] titles are the highest priority and rank each high priority title in excess of [ * ] in order of T-Mobile’s priority. T-Mobile and Danger may mutually agree to extend the testing timeline for “high priority” titles on a case by case basis. Danger will notify T-Mobile promptly when each “high priority” title has been certified by Danger. Danger will manage the certification process for all other Premium Content so that the Target Date for initial testing is set at [ * ] business days following submission by T-Mobile into the Content Certification Plan and the Target Date for follow-up testing within [ * ] business days following resubmission. Certain Premium Content certified by Danger as being compliant with the Content Certification Plan will be updated on the Certification Status Document.

(iii) On a monthly basis, Danger will create, maintain, and deliver to T-Mobile a launched content report in the format provided to T-Mobile and dated October 19, 2007 (which T-Mobile and Danger may mutually agree to update from time to time) with the following information for Applications (“Launched Content Report”): all Applications grouped by each provider, launched Applications grouped by handset, and pricing for each Application.

D. T-Mobile Trial Program. At T-Mobile’s written request, Danger will provide T-Mobile with the opportunity to preview Danger Sourced Premium Content by placing titles in the T-Mobile Trial Program catalog. At T-Mobile’s written request, Danger will place proposed T-Mobile Sourced Premium Content in the T-Mobile Trial Program catalog to help facilitate T-Mobile’s evaluation and testing efforts. Following receipt of such request, Danger will use commercially reasonable efforts to place such Premium Content in the trial catalog within [ * ] business days after receiving such request from T-Mobile. Danger shall create a separate “restricted access” folder in the PDM for use by T-Mobile in the T-Mobile Trial Program. Unless T-Mobile instructs Danger in writing otherwise, Danger will place all Premium Content in the “restricted access” folder. T-Mobile shall have the right to specify up to [ * ] T-Mobile Trial Program participants that will be allowed access to the “restricted access” folder and the Premium Content therein. No other T-Mobile Trial Program participants will be permitted to have access to the Premium Content in the “restricted access” folder.

E. Security. Danger will provide reasonably appropriate security for T-Mobile Sourced Premium Content that is at least as great as the security it takes to protect Danger Sourced Content. Danger may not disable or modify any security features or functionality that are part of the T-Mobile Sourced Premium Content and will use commercially reasonable efforts to incorporate security features or functionality that are provided to Danger by T-Mobile or a third party provider for use in connection with T-Mobile Sourced Premium Content.

IV. Content Launch Process. Danger will assist T-Mobile in selecting, licensing, testing, certifying and publishing Premium Content in accordance with the terms set forth in Appendix A and Appendix C.

V. Payments and Revenue Share. The parties agree that the terms set forth in Appendix B shall apply with respect to payments and the allocation between the parties of revenue derived from the distribution to Subscribers of Premium Content through the Premium Download Manager.

VI. End User Support. The parties agree that the following terms shall apply with respect to end-user support for Premium Content:

4.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

(i) Danger Sourced Premium Content. Danger’s license agreements with third-party developers of Danger Sourced Premium Content shall provide that the developers are responsible for end-user support via email, with an email acknowledgement response time of twenty-four (24) hours or less. Danger will require its third party developers to create a FAQ web site for each Danger Sourced Application and provide Danger an email contact address as well as the html FAQ address. Danger will provide to T-Mobile the email contact address and html FAQ address (provided such html FAQ address has been supplied to Danger by the Application developer) for each Danger Sourced Application. T-Mobile and, if applicable, Danger shall refer all end user requests for support related to Danger Sourced Premium Content directly to the applicable developer. For Danger Sourced Applications that are developed by Danger, Danger will provide T-Mobile an email address and will respond within 24 hours from a support request sent to such email address. Danger will also create an html FAQ page for each Danger Sourced Application it develops.

(ii) T-Mobile Sourced Premium Content. T-Mobile’s license agreements with third-party developers of T-Mobile Sourced Premium Content may provide that the developers are responsible for end-user support via email, with an email acknowledgement response time of 24 hours or less. T-Mobile and, if applicable, Danger shall refer all end user requests for support related to T-Mobile Sourced Premium Content directly to T-Mobile or the applicable developer, at T-Mobile’s discretion. Danger shall have no obligation to provide support to end users in connection with T-Mobile Sourced Premium Content.

(iii) Danger Support Tool. Danger shall ensure that the Premium Download Manager interfaces with the Danger Support Tool in order to provide T-Mobile’s customer service representatives with information about what Premium Content have been downloaded to Danger Devices and the ability to resend Premium Content to Subscribers or credit their accounts for Premium Content that was previously downloaded. The Danger Support Tool will allow T-Mobile to look up transactions by applicable Danger Device phone number and in accordance with the then-current Third Party Content Customer Care Interface Document. In addition, when and if the Danger Support Tool has the capability, Danger will list the URL to the FAQ for the applicable Application and provide a developer email address for such Application.

VII. Indemnification. For the avoidance of doubt, T-Mobile Sourced Content shall constitute T-Mobile Premium Services for purposes of Section 17.4 of the Agreement and Danger Sourced Content shall constitute Danger Services for purposes of Section 17.1 of the Agreement. Notwithstanding the above, Danger will indemnify T-Mobile against any claim that Danger’s distribution prior to April 25, 2007 of T-Mobile Sourced ringtones, violated a third party’s performance rights.

A. [ * ]. The parties acknowledge and agree in light of the [ * ], T-Mobile will not pay Danger a fee to [ * ]. Danger shall pay T-Mobile $ [ * ] as a reimbursement for the amounts T-Mobile paid to Danger after [ * ]. The parties agree that no additional refunds for amounts paid by T-Mobile to Danger to [ * ] shall be due. For T-Mobile Sourced [ * ], T-Mobile will indemnify Danger for any claim that Danger’s distribution of [ * ].

VIII. Yahoo! Messenger. Danger will make Yahoo^® Messenger, as more fully described in Schedule 1 of this Amendment, available to Subscribers. The Yahoo Messenger Application will be considered to be Danger Sourced Premium Content. The parties have entered into all necessary license and any other agreements reasonably necessary to enable the parties to provide Yahoo Messenger to Subscribers. Danger will provide monthly reports to T-Mobile with respect to Yahoo! Messenger containing the information set forth in Schedule 1 to this Amendment. No

5.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

amounts will be owed by T-Mobile owed under Appendix B for the Yahoo! Messenger Application.

IX. IP Relay. In lieu of the pricing set forth in Appendix B, Danger will pay T-Mobile [ * ] of the [ * ] from [ * ] and/or [ * ] in connection with the distribution of IP Relay Applications (as described in Schedule 3 of this Amendment). The [ * ] and/or [ * ] IP Relay Applications will be considered to be Danger Sourced Premium Content.

X. Intellisync Software.

a. Intellisync Software. Danger agrees to provide T-Mobile with Intellisync^® software from Intellisync Corporation, which will enable Subscribers to synchronize personal information management data (including calendar, contacts and to do lists) between Microsoft Outlook and Danger Devices via the Danger Content (the “Intellisync Software”). The Intellisync Software will include the features and functionality set forth in Schedule 3 of this Amendment. For purposes of this Agreement, the Intellisync Software will be considered a Danger Sourced Premium Content.

b. Distribution of Intellisync Software. Danger makes the Intellisync Software available to Subscribers through Danger’s Desktop Interface. The distribution of the Intellisync Software to each Subscriber shall be pursuant to an end user license agreement that prohibits copying and reverse engineering of the Intellisync Software, disclaims warranties for the Intellisync Software, and limits liability to the greatest extent allowed by law. Each Subscriber downloading the Intellisync Software shall be required to affirmatively agree to the terms of such end-user license agreement before downloading or installing the Intellisync Software or any portion thereof.

c. Billing and Payment for the Intellisync Software.

(i) Danger will provide T-Mobile with electronic records of Subscriber downloads of the Intellisync Software. Such records shall be provided by Danger via the “Premium Download Manager” billing system agreed to by the parties.

(ii) In lieu of the pricing set forth in Appendix B, T-Mobile will pay to Danger the greater of (i) [ * ] of the [ * ] for each successful download of the Intellisync Software or (ii) [ * ] per successful download of the Intellisync Software. [ * ] shall not [ * ] of the Intellisync Software if [ * ] and done within thirty (30) days after the applicable download. Danger shall invoice T-Mobile for amounts due hereunder with the same invoice for Premium Content as provided for herein.

(iii) If T-Mobile discontinues the availability of the Intellisync Software, Danger shall continue to cause the Danger Service to support the existing users of the Intellisync Software in accordance with the terms of the Agreement (including Sections 4.1(b) of the Agreement and Exhibit B: Content Level Agreement)) for a minimum of [ * ] or such longer period as may be required by the end user license agreement. Danger’s obligation to continue support in the preceding sentence shall be limited to the last version of the Intellisync Software distributed by Danger through T-Mobile. Notwithstanding anything set forth in Section 11(c)(ii) of the Agreement, T-Mobile may, following written notice to Danger and contingent on the parties agreeing on an amount (not to exceed [ * ] (as defined below), [ * ] payment structure set forth in Section 11(c)(ii) of the Agreement, and [ * ] payment structure. Under the [ * ] payment structure T-Mobile will pay Danger [ * ] for each Danger Device shipped after the new payment structure is put into effect that has the ability to use the Intellisync Software. The “[ * ]” shall be calculated as follows: the sum of (i) the [ * ] The [ * ] calculation shall be made as of the date the “[ * ]” payment structure went into effect.

6.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

(iv) Danger will provide T-Mobile with reports detailing Intellisync Software download activity that are consistent with the reports provided for application download activity on the “Premium Download Manager”.

d. Customer Support for Intellisync Software. T-Mobile will provide customer support for the Intellisync Software to Subscribers in accordance with Section 4.2 of the Agreement and the Customer Support SLA. Danger shall perform its support obligations with respect to the Intellisync Software in accordance with Section 4.2 of the Agreement and Exhibit C: Customer Support SLA. Danger shall have no obligation to provide customer support for the Intellisync Software directly to Subscribers.

XI. Entire Amendment. This Amendment and the Agreement constitute the entire agreement between the parties with respect to the subject matter hereof and merge all prior and contemporaneous communications. They shall not be further modified except by a written agreement dated subsequent to the Amendment Effective Date and signed on behalf of T-Mobile and Danger. The parties agree that the following provisions of the Agreement will not apply with regard to Premium Content: Sections 3, 4.1, 6.3, 6.7, 7, 8, 9, 11 and 13.

IN WITNESS WHEREOF, the parties have entered into this Amendment as later of the two dates below.

T-Mobile USA, Inc. (“T-Mobile”)		Danger, Inc. (“Danger”)
/s/ Joe Sims		/s/ Henry R. Nothhaft
By	(signature)	By	(signature)
Name	Joe Sims	Name	Henry R. Nothhaft
Title	VP & General Manager, New Business Development	Title	Chairman & Chief Executive Officer
Date	November 30, 2007	Date	November 30, 2007

T-Mobile Legal Approval By: /s/ Paul W. Boyer                

7.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Appendix A

Content Launch Process

1. Danger Sourced Content Default. The parties intend that Danger will act as the principal sourcing point for Certain Premium Content. As such, if T-Mobile desires to include a particular item of Certain Premium Content within the Premium Download Manager and Danger already has a license for such item of Certain Premium Content, the item will not be T-Mobile Sourced Certain Premium Content under this Amendment, unless such item falls within the “T-Mobile Exception” outlined in Section 3 of this Appendix A. For the avoidance of doubt, T-Mobile may provide T-Mobile Sourced Certain Premium Content if Danger does not have rights to license a particular item of Certain Premium Content or if the item falls within the T-Mobile Exception. If Danger later obtains rights to a particular item of T-Mobile Sourced Certain Premium Content and the item does not fall within the T-Mobile Exception, the item of content will be deemed Danger Sourced Certain Premium Content under the Agreement. If an item is deemed Danger Sourced Certain Premium Content under the preceding sentence or otherwise, the change will become effective on the first day of the next calendar month. For proposed Danger Sourced Certain Premium Content, Danger will use commercially reasonable efforts to acquire all necessary rights to distribute the Danger Sourced Certain Premium Content for a minimum of [ * ] from the release of such content. If Danger does not have the necessary rights for the proposed Danger Sourced Certain Premium Content to be distributed for a minimum of [ * ], then prior to T-Mobile’s consideration and approval of such item of content, Danger will provide notice to T-Mobile in the Pipeline Overview Document described in Section 4A of this Appendix of the length of time that such Danger Sourced Certain Premium Content may be distributed. Danger will not collect any Backend Revenues in connection with any Danger Sourced Premium Content without T-Mobile’s prior written approval (email from a T-Mobile employee with the title of director level or above within T-Mobile’s product development or marketing group). The parties hereby approve of the IP Relay titles from [ * ] and [ * ] as Premium Content subject to the Backend Revenues share. If Danger receives Backend Revenues for items of Premium Content, Danger will pay T-Mobile a share of the Backend Revenues in accordance with Appendix B. If Danger initiates a promotional activity that does not involve Premium Content, Danger will pay T-Mobile a share of the Backend Revenues in accordance with Appendix B. If T-Mobile wishes to distribute T-Mobile Sourced Certain Premium Content to Subscribers for free or at discounted rate and, , collect additional revenues from a third party content provider, T-Mobile and Danger will work in good faith to mutually agree to an appropriate model for compensating Danger in lieu of the revenue shares outlined in Appendix B Notwithstanding the foregoing, Danger acknowledges and agrees that it will provide support for the development and certification of such T-Mobile Sourced Certain Premium Content as long as the parties are engaged in discussions regarding compensation pursuant to the preceding sentence. Absent reaching an agreement for compensating Danger prior to launch, T-Mobile may choose to either delay launch pending the parties’ mutual agreement or require Danger to launch such Premium Content (if otherwise certified), subject to the following sentence. If [ * ] following launch the parties have not mutually agreed on the compensation for Danger for such T-Mobile Sourced Certain Premium Content, the parties shall escalate the discussion to their respective senior management, and if the parties have not reached an agreement on compensating Danger [ * ] following the launch, Danger may remove such Premium Content from the PDM and discontinue support for such Premium Application. For the avoidance of doubt, if T-Mobile collects revenues from a third party for T-Mobile Sourced Certain Premium Content that is not offered for free or at a discounted rate, T-Mobile will not be required to discuss any alternative compensation for Danger unless such Premium Content offers functionality that requires Danger to provide

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significant additional development or certification support as compared to Premium Content of the same general type.

2. T-Mobile Referrals. If T-Mobile desires to license Certain Premium Content from a particular content provider (except in the case of content providers that fall within the T-Mobile Exception), T-Mobile will notify Danger and introduce Danger to the provider if needed. At the time of T-Mobile’s notification, T-Mobile will indicate whether the provider is “high priority.” Danger will use commercially reasonable efforts to enter into licensing agreements with each content provider that T-Mobile designates as “high priority” within [ * ] days. For all other providers, Danger will pursue licensing agreements in its discretion. Danger will notify T-Mobile as to whether it plans to pursue a relationship with all non-high priority providers or whether it needs more time to investigate such a relationship within [ * ] days.

3. T-Mobile Exception. T-Mobile will not be required to source through Danger and may license directly (“T-Mobile Exception”): (i) Certain Premium Content if T-Mobile enters into a relationship which it deems, in its sole discretion, a corporate strategic initiative (e.g., a sponsorship or promotional deal) with the content provider or (ii) in the case of Backgrounds and Themes, the content provider is one of the four (4) [ * ] (e.g., [ * ]). With respect to each item of T-Mobile Sourced Certain Premium Content, T-Mobile shall notify Danger and, to the extent T-Mobile deems necessary, introduce Danger to the provider, as set forth in more detail in Section 2 above. If T-Mobile deems a particular provider to be strategic and within the scope of the T-Mobile Exception, T-Mobile will notify Danger and Danger will not engage in discussions with such provider about sourcing content for T-Mobile. Danger will provide certification support to the content providers of T-Mobile Sourced Certain Premium Content.

4. Commercial Deployment of Certain Premium Content in the Premium Download Manager.

A. Pipeline Overview Document and Monthly Meetings. Danger will maintain a spreadsheet with a summary of all titles of Certain Premium Content that are in development as well as prospective concepts for review (“Pipeline Overview Document”). Danger makes items of Certain Premium Content available on a when-and-if available basis. The Pipeline Overview Document is not a binding commitment to launch an item of content or guarantee that Danger has the rights to launch an item of content. The Pipeline Overview Document will contain both T-Mobile Sourced and Danger Sourced Certain Premium Content. For each item, the Pipeline Overview Document will contain title; provider; suggested retail pricing, anticipated Average Network Usage Per User classification (e.g. [ * ]) for Applications; applicable device(s); proposed revenue share classification (e.g., Standard/Premium); proposed “Tier” classification under table 1 set forth below for all titles that are classified as “Tier 1” or “Tier 2;” a one-page overview description of the title; file size of the title if available; any “non-standard” license terms (e.g. special promotional requirements; an initial license term of less than [ * ]); the license status of each title (e.g. whether Danger has the rights to launch); and a target publication date. The Pipeline Overview Document will be provided to T-Mobile on a monthly basis in connection with monthly pipeline review meetings to be held on-site at T-Mobile or via phone with representatives of both parties in attendance T-Mobile will use commercially reasonable efforts to review and provide feedback on the Pipeline Overview Document within [ * ] business days following each monthly pipeline review meeting and approve on the Pipeline Overview Document the following: content providers and titles that are “high priority,” titles T-Mobile will pay Premium pricing for, Danger’s proposed Tier and anticipated Average Network Usage Per User classifications, and titles T-Mobile would like Danger to proceed with testing and move towards commercial launch. For titles that fall within Tier 1, if T-Mobile does not respond to Danger within the [ * ] business day period or if T-Mobile’s response does not indicate that T-

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Mobile does not want Danger to move forward with testing, Danger may consider the title approved, subject to the terms set forth in Section 4.C. of this Appendix A. Danger will not launch any Tier 2 title unless T-Mobile expressly indicates in the Pipeline Overview Document that the title has been approved. If, at any time after the approval of a title in the Pipeline Overview Document T-Mobile changes its mind with regard to a specific title or designation, T-Mobile shall promptly notify Danger of such change in writing (email is acceptable).

Table 1
Tier 1 [ * ]	Games that [ * ] including: •     [ * ] •     [ * ] games anticipated to have [ * ] •     [ * ] games anticipated to have [ * ] [ * ] and [ * ] Applications. [ * ] and [ * ] Applications [ * ]
Tier 2 [ * ]	Applications intended for a [ * ] Applications that would require the [ * ] Applications from [ * ] [ * ] Applications that are [ * ] Applications that [ * ]
Tier 3	[ * ] [ * ] Applications Applications [ * ]

B. New Product and Platform Innovation. The parties desire to evolve the Premium Content product offering and platform. To encourage such innovation, the parties shall periodically meet to discuss T-Mobile’s and Danger’s long-term concepts in innovation with respect to both individual Premium Content products as well as the Premium Download Manager. If Danger presents a written proposal with respect to new Premium Content opportunities or Premium Content types, T-Mobile will use commercially reasonable efforts to provide a written response to Danger’s proposal within a mutually agreed upon time frame targeted to be approximately [ * ] days. Danger and T-Mobile will agree on the appropriate action plan and follow-up (if any) for the management of individual proposals.

C. Editorial & Publishing and Launch Scheduling. Danger will create, maintain, and deliver to T-Mobile on a bi-weekly basis a content publishing report (“Content Publishing Report”) which will contain the following information for Applications:

• Proposed 4-6-week launch schedule for titles that have been approved during the Pipeline Review Process, as well as historical view of weekly launches since last Launched Content Report.

• For each title: Title, Genre, Short Description, Suggested Retail Price, Networked Application Tier, launch date and revenue share classification.

Danger will not include any content in the Content Publishing Report, unless Danger has the rights to launch the content. T-Mobile will use commercially reasonable efforts to review and provide feedback on the Content Publishing Report within [ * ] business days following receipt

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from Danger. T-Mobile will expressly indicate in its feedback to the Content Publishing Report which titles T-Mobile approves for launch along with certain launch dates and the pricing for each approved title. For the avoidance of doubt, titles in the Content Publishing Report are not expressly approved by T-Mobile, unless T-Mobile indicates by marking or initialing its approval. Danger’s designation in the Content Publishing Report that a title is “approved” for launch will not be considered T-Mobile approval. Danger will use commercially reasonable efforts to implement T-Mobile’s pricing and scheduling changes to the Content Publishing Report within [ * ] days following receipt of T-Mobile’s feedback. On a monthly basis during the Term, the parties will meet on-site at T-Mobile or via phone and discuss the publishing and promotion of Applications that have been approved by T-Mobile for launch. The goal of such meetings will be to determine the launch schedule for Applications to be launched within the next [ * ] to [ * ] weeks following the meeting. Provided that T-Mobile complies with the processes outlined in this Amendment and Sections 4A and C of this Appendix, Danger will target launching: (i) [ * ] new Application titles during each calendar quarter of the Term; (ii) [ * ] new Application titles simultaneous with the launch of each new Danger Device, when and if new Danger Devices become available; and (iii) between [ * ] and [ * ] new Background Images and Themes per each calendar quarter of the Term.

D. Editorial Control over Content Availability, Schedule, and Placement. T-Mobile, in its sole discretion, shall have full editorial control with respect to the availability, schedule, and location of all Certain Premium Content in the Premium Download Manager application.

E. Danger’s Removal of Premium Content.

(i) Danger Sourced Premium Content. After notice to T-Mobile, Danger may reject or remove any Danger Sourced Premium Content from the Premium Download Manager that, in Danger’s reasonable discretion (A) infringes the intellectual property or other rights of a third party, (B) is libelous, defamatory, obscene or pornographic, (C) may violate other civil or criminal laws; including those regulating the use and distribution of content on the Internet and protection of personal privacy, (D) is technically non-functional or inhibits the performance of other applications on the device, or (E) threatens the security or stability of the Danger Services. In addition, Danger may elect not to launch Danger Sourced Premium Content in the event that, in Danger’s good faith business judgment, T-Mobile’s suggested retail price for such content does not allow Danger to cover its cost plus a reasonable profit margin for such content. Danger will promptly notify T-Mobile if Danger believes that the suggested retail price that T-Mobile plans to adopt does not permit Danger to cover its cost plus a reasonable profit margin for a particular item of content.

(ii) T-Mobile Sourced Premium Content. Danger may reject proposed T-Mobile Sourced Premium Content, or remove from the catalog and suspend the server-side functionality of any T-Mobile Sourced Premium Content from the Premium Download Manager that, in Danger’s reasonable discretion, threatens the security or stability of the Danger Service, Danger Device, or Basic Services. Notwithstanding the preceding sentence, prior to removing any T-Mobile Sourced Premium Content, Danger will use commercially reasonable efforts to contact T-Mobile in order to request approval of such removal. For purposes of clarification, each party agrees that Danger’s suspension right granted in the preceding sentence is limited to suspending the server-side functionality of T-Mobile Sourced Premium Content. Danger may not under any circumstances remove an application from a Subscriber’s Danger Device via Over-the-Air update or otherwise without the prior written approval of T-Mobile. In addition, after notice to and with approval from T-Mobile, Danger may remove any T-Mobile Sourced Premium Content from the Premium Download Manager that, in Danger’s reasonable discretion (A) infringes the intellectual property or other rights of a third party, (B) is libelous, defamatory,

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obscene or pornographic, (C) may violate other civil or criminal laws;, including those regulating the use and distribution of content on the Internet and protection of personal privacy, or (D) is technically non-functional or inhibits the performance of other applications or services on the device. If T-Mobile disagrees with Danger in regard to the need to remove T-Mobile Sourced Premium Content, then the parties will meet (in person or via telephone) to discuss and mutually agree on whether such content should be removed.

(iii) Nothing in the Agreement or this Amendment (including without limitation any approval of content pursuant to the processes contained herein) shall obligate T-Mobile to include any Premium Content in the Premium Download Manager or Danger’s Desktop Interface and Danger will remove Premium Content within a commercially reasonable period of time, which will be no more than [ * ] business [ * ] following notice, if such Premium Content: (A) infringes the intellectual property or other rights of a third party, (B) is libelous, defamatory, obscene or pornographic, (C) may violate other civil or criminal laws, including those regulating the use and distribution of content on the Internet and protection of personal privacy, (D) is technically non-functional or inhibits or impairs the performance of the T-Mobile Network or other applications on the device, (E) causes or results in a higher than average number of calls to or refunds or credits from T-Mobile’s customer care, or (F) a third party content provider or government order requires T-Mobile to remove the Premium Content on an expedited basis.

5. Marketing & Promotion:

A. Splash Screens. Danger and T-Mobile will propose promotions for and T-Mobile will approve a Splash Screen publishing schedule reflecting Splash Screen promotion dates and durations in the format provided to T-Mobile (which T-Mobile and Danger may mutually agree to change from time to time) (“Splash Screen Publishing Schedule”). T-Mobile will make its Splash Screen proposals to Danger at the monthly publishing and launch scheduling meeting pursuant to Section 4A of this Appendix or in an email. Danger will create, subject to technical feasibility, all Splash Screens and will design T-Mobile proposed Splash Screens. Danger will design Splash Screens within [ * ] business days following receipt of T-Mobile’s proposal. For items designated as rush promotions, Danger will use commercially reasonable efforts to design the Splash Screen in no more than [ * ] business days. At least [ * ] days prior to the monthly publishing and launch scheduling meeting, Danger will provide a proposed Splash Screen Publishing Schedule covering the [ * ] period commencing [ * ] weeks after the meeting as well as a Splash Screen concept document with the actual creative for the Splash Screens on the proposed schedule. Danger agrees that the schedule proposed by Danger will target [ * ] to [ * ] Splash Screen launches per month with a minimum run of [ * ] per each Splash Screen promotion. The parties will periodically evaluate the foregoing frequency and duration targets based upon actual results and may mutually agree to change these targets. T-Mobile will use commercially reasonable efforts to provide feedback on the Splash Screen Publishing Schedule and Splash Screen creative concepts within [ * ] business days following the meeting. If T-Mobile requests revisions to the creative, Danger will revise the creative and resubmit the Splash Screen concept document within [ * ] business days following receipt of T-Mobile’s feedback. The parties will continue to work together to revise Splash Screens until they are approved by T-Mobile.

B. Time Sensitive Promotion Alignment. Danger will use best efforts to support T-Mobile’s goal of aligning Danger Device promotions with promotions across the T-Mobile device portfolio, particularly with respect to time-sensitive opportunities (e.g., a movie release or a holiday). In order to achieve T-Mobile’s goal, the parties will take the following steps:

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(i) For Applications that are scheduled to launch on a particular date, T-Mobile will use commercially reasonable efforts to submit the Application proposal to Danger [ * ] days prior to the launch date. Danger will use commercially reasonable efforts to work with the Application developer to mutually agree on a testing and revisions schedule in order to ensure that the Application is certified and ready for launch on the launch date.

(ii) For Splash Screens, T-Mobile will submit Splash Screen proposals to Danger ten (10) business days prior to the desired launch date for the promotional Splash Screen.

(iii) Danger and T-Mobile will work together to develop a timeline for reconfigurations of the promotional folder within the Premium Download Manager when they are requested by T-Mobile. The timeline will be based upon the scope of the proposed reconfiguration.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Appendix B

Pricing and Payments

1. Definitions.

A. “Average Revenue Per User” for a particular month is derived by dividing the [ * ] by [ * ].

B. “Total Revenues” means the [ * ], less [ * ].

C. “Total Users” means the [ * ]. T-Mobile must report Total Users to Danger by the tenth (10^th) day of the month following the previous month’s calculation.

2. Revenue Share. The parties agree that the following terms shall apply with respect to payments and the allocation between the parties of revenue derived from the distribution to Subscribers of Certain Premium Content through the Premium Download Manager. Notwithstanding, for all Certain Premium Content launched prior to the Effective Date, the content categorizations and types set forth in Schedule 4 of this Amendment shall apply.

A. T-Mobile Sourced Certain Premium Content. For each Successful Download of or monthly recurring subscription charge for an item of T-Mobile Sourced Certain Premium Content, T-Mobile will pay Danger [ * ] of the [ * ] for such T-Mobile Sourced Content.

B. Danger Sourced Backgrounds and Themes. For each Successful Download of or monthly recurring subscription charge for a Danger Sourced Background or Theme, T-Mobile will pay a percentage of the [ * ] for such Danger Sourced Background or Theme at the rates set forth in the following table:

Content Categorization and Type	Revenue Share Percentage
Premium Backgrounds	[	* ]%
Standard Backgrounds	[	* ]%
Premium Themes	[	* ]%
Standard Themes	[	* ]%

C. Danger Sourced Applications. For each Successful Download of or monthly recurring subscription charge for a Danger Sourced Application, T-Mobile will pay a percentage of the [ * ] for such Danger Sourced Application based upon the content categorization (e.g, Standard versus Premium) and the Average Network Usage Per User at the rates set forth in the following table:

Content Categorization and Average Network Usage Per User (“ANUPU”)	Revenue Share Percentage
Premium Application [ * ] ANUPU	[	* ]%
Premium Application [ * ] ANUPU	[	* ]%
Premium Application more than [ * ] ANUPU	[	* ]%
Standard Application [ * ] ANUPU	[	* ]%
Standard Application [ * ] ANUPU	[	* ]%
Standard Application more than [ * ] ANUPU	[	* ]%

As of the Amendment Effective Date, T-Mobile does not have systems in place to easily track the ANUPU. Until such time as T-Mobile is able to easily track the ANUPU, Danger will be paid for Applications based upon the ANUPU designation approved by

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T-Mobile in the Pipeline Overview Document. Danger will make its proposed ANUPU designation in the Pipeline Overview Document in good faith based upon information obtained by Danger when testing the Application. T-Mobile may audit the ANUPU designation of any Application after it has been launched and if T-Mobile determines that the actual ANUPU for such Application is higher than the designation approved by T-Mobile, the designation will be changed and the revenue share percentage under this Section will be adjusted to reflect actual ANUPU. The foregoing adjustment will be applied on a going forward basis beginning on the first day of the next calendar month, unless T-Mobile determines that Danger’s proposed ANUPU designation was not based upon Danger’s testing of the Application, in which case the adjustment will be replied retroactively as well. At the time T-Mobile obtains the capability of tracking actual ANUPU, and on a going forward basis, the payments under this Section will be made based upon actual ANUPU; provided that if there is engineering work required for Danger to interface with T-Mobile’s ANUPU based billing functionality the parties have reached an agreement regarding such engineering work, and provided further that Danger has at least [ * ] days following T-Mobile’s confirmation of its ANUPU billing capability before payments are calculated based upon actual ANUPU.

D. Danger Sourced Ringtones. For each Successful Download of a Danger Sourced ringtone, T-Mobile will pay Danger as set forth below:

(i) Polyphonic ringtones and Hi-Fi Ringers: T-Mobile will pay Danger [ * ] plus [ * ] of [ * ] received by T-Mobile in excess of ($[ * ]) for the Successful Download of such ringtone.

(ii) Sound Effects: T-Mobile will pay Danger [ * ] for each Successful Download of such ringtone.

(iii) Voice Ringers: T-Mobile will pay Danger [ * ] for each Successful Download of such ringtone.

(iv) Delivery Fee: In addition to the service fee set forth above, for each Successful Download of a ringtone that is Danger Sourced Content, T-Mobile will pay to Danger [ * ].

(v) Special Fees: In the event that special circumstances apply to particular ringtones that are Danger Sourced Content (e.g. third party license fees are not fully covered by the royalties set forth above), Danger may notify T-Mobile in writing that it desires to modify the royalties specified above for such ringtones and T-Mobile and Danger may thereafter engage in good faith negotiations with respect to a modification of the royalty rates for such ringtones. T-Mobile is under no obligation to accept Danger Sourced Content that are subject to special fees.

E. T-Mobile Sourced Ringtones. For each Successful Download of a T-Mobile Sourced ringtone, T-Mobile will pay Danger a delivery fee of [ * ], excluding downloads for internal T-Mobile employee testing.

3. Increased ARPU. T-Mobile will, in accordance with the table below, pay Danger an increased revenue share for all Certain Premium Content under Section 1 based upon the Average Revenue Per User in a calendar month:

ARPU	Percentage Increased Revenue Share
$[ * ]	[	* ]%

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$[ * ]	[	* ]%
$[ * ]	[	* ]%
$[ * ]+	[	* ]%

4. Backend Revenues. Danger will pay T-Mobile [ * ] of all Backend Revenues received by Danger.

5. Invoices. Within thirty (30) days after the end of each calendar month during the Term, Danger will pay T-Mobile the Backend Revenues and will invoice T-Mobile for amounts due under this Amendment and T-Mobile will pay such invoices within thirty (30) days following receipt thereof.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Appendix C

Certification and Publishing Process for Backgrounds, Themes and Ringtones

1. Certification and Publishing of Backgrounds/Themes.

A. Certification. Danger will be responsible for the certification of all Backgrounds and Themes according to the Backgrounds and Themes specification provided to T-Mobile and dated June 6, 2007, which Danger may update from time to time in its reasonable discretion. For T-Mobile Sourced Backgrounds and Themes, T-Mobile will use commercially reasonable efforts to introduce Danger to third party developers at least [ * ] days prior to the targeted completion date to give Danger adequate time to perform its support and certification services. T-Mobile will accompany each developer introduction with the following information: titles to be certified and published; target publication date(s); and suggested retail price. Danger can support the publishing of up to [ * ] T-Mobile Sourced Backgrounds or Themes each week. For batches of more than [ * ] Backgrounds or Themes, T-Mobile and Danger will work together to identify a publishing timeframe for those Background or Themes in excess of [ * ].

B. Publishing. Danger will provide an overview of new, certified Backgrounds and Themes at least one (1) week prior to the target publication date which overview shall contain the following information:

(i) Backgrounds. For all new, certified Backgrounds, Danger will provide T-Mobile with a Word document containing a top-level and sub-folder image of each proposed Background; proposed catalog categorization; and for Danger Sourced Content, proposed revenue share classification (e.g. “Standard/Premium”).

(ii) Themes. For all new, certified Themes, Danger will provide T-Mobile with a Word document containing a top-level and sub-folder image of each proposed Theme; proposed catalog categorization; for Danger Sourced Content, proposed revenue share classification (e.g. “Standard/Premium”); and the open/close hinge audio file clips.

T-Mobile will use commercially reasonable efforts to review proposed Backgrounds and Themes within [ * ] business days. Danger will only publish Backgrounds or Themes for which it has obtained T-Mobile’s prior written consent.

2. Delivery Process for Ringtones.

T-Mobile will use commercially reasonable efforts to deliver ringtones to Danger in a single batch and at least [ * ] week prior to the target publishing date (each constituting a “Delivery”). If a Delivery contains more than [ * ] ringtones, all ringtones in excess of [ * ] may not be published on the target publishing date and the parties will work together to identify a publishing timeframe. T-Mobile will package each Delivery according to the file format and packaging specifications that have already been provided to T-Mobile in a separate excel spreadsheet. Each Delivery will include a manifest in MS Excel or delimited text format in substantially the format previously agreed to by the parties that includes the following information for each ringtone:

(i) Main category (e.g. “HiFi Ringers”);

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

(ii) Sub-category: genre or catalog folder in which the ringtone should appear;

(iii) Title: typically, title/artist; thirty-four (34) character limit;

(iv) Licensor information: the information that should be displayed alongside the content offering in the PDM (e.g. ^©2007 Sony BMG Entertainment);

(v) Description: typically, a full version of the title; sixty-six (66) character limit;

(vi) Thumbnail: exact title of the image file delivered;

(vii) Preview file wav: exact title of the wav file delivered;

(viii) Content file wav: exact title of the wav file delivered;

(ix) Preview file mp3: exact title of the mp3 file delivered; and

(x) Content file mp3: exact title of the mp3 file delivered.

A Delivery will constitute T-Mobile’s approval for Danger to publish the ringtones in the Delivery on the target publication date specified by T-Mobile.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Schedule 1

Monthly Yahoo! Messenger Reporting

The number of [ * ]

The number of [ * ]

The number of [ * ]

The number of [ * ]

The number of [ * ]

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Schedule 2

[ * ]

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Schedule 3

[ * ]

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

Schedule 4

[ * ]

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EX-10.22

Exhibit 10.22

M O T O R O L A / D A N G E R    C O N F I D E N T I A L    P  R O P R I E T A R Y

MASTER SOFTWARE LICENSE, PRODUCT DEVELOPMENT AND DISTRIBUTION AGREEMENT

This MASTER SOFTWARE LICENSE, PRODUCT DEVELOPMENT AND DISTRIBUTION AGREEMENT (“Agreement”), effective the date of last signature below (the “Effective Date”), is made between Motorola, Inc., a Delaware corporation, and its affiliates with a place of business at 600 North U.S. Highway 45, Libertyville, IL 60048 (“Motorola”); and Danger, Inc., a Delaware corporation, with an office at 3101 Park Blvd., Palo Alto, CA 94306 (“Danger”). Motorola and Danger are each a “Party,” and together are “Parties,” to this Agreement.

IN WITNESS WHEREOF, this Agreement together with its attachments constitutes the entire agreement between the parties regarding the subject matter hereof and supersedes any and all prior negotiations, promises, commitments, undertakings, and agreements of the parties relating thereto.

MOTOROLA, INC.		DANGER
By:	/s/ Steve Lala	By:	/s/ Henry R. Nothhaft
Name:	Steve Lala	Name:	Henry R. Nothhaft
Title:	Corporate VP 3GSM	Title:	Chairman & CEO
Date:	9/14/2006	Date:	9/14/2006

Attachments:

Exhibit A - Statement of Work: Product Specifications; Acceptance Test Criteria

Exhibit B Support Services

Exhibit C - Master Technology Escrow Deposit Supplement

AGREEMENT

1) DEFINITIONS.

a) “Acceptance” or “Accepted” means that a Deliverable is verified by Motorola as conforming to the technical and functional specifications stated in Exhibit A (“Specifications”).

b) “Adaptations” shall mean any changes, associated technical data and information; specific to integration of the Software with Motorola Products.

c) “Approved Carriers” shall mean wireless network operators that purchase hosted data services from Danger.

d) “Client Software” means Danger’s proprietary software that is installed on the Products. Client Software shall include all [ * ] Motorola as specified in this Agreement or in an applicable SOW. Client Software does not include software [ * ] (e.g. [ * ], etc.) or [ * ] (as defined below).

e) “Deliverable(s)” means Client Software and such items identified in the Statement of Work.

f) “Derivative Work” means a work that is based on one or more pre-existing works, such as a revision, enhancement, modification, translation, abridgement, condensation, expansion, or any other form in which such pre-existing work may be recast, transformed, or adapted, and, if prepared without authorization of the copyright owner of such pre-existing work, would constitute a copyright infringement. For purposes of this Agreement, a Derivative Work includes a compilation that incorporates such pre-existing work.

Software License & Distribution Agreement Page 1 of 35 Version 17 May 2006

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g) “Documentation” means, in a format as mutually agreed, the user guide, compilation instructions, documents, manuals and computer-readable files, regarding the installation, use, operations, functionality, troubleshooting and other technical information sufficient to use the Deliverables.

h) “End-Users” means customers who acquire Product(s) for their use and not for resale.

i) “Enhancement” means any material addition to the performance or functionality of the Software that is not simply the correction of an error.

j) “Illicit Code” means any computer instructions in the Software that are not intended to provide the functionality described in the Software’s Documentation and that interfere with Motorola’s use or right to quiet enjoyment of its license to the Software or that interfere with or prevent Motorola’s use of the Software as provided in this Agreement. Illicit Code includes what is commonly known as computer viruses, Trojan Horses, self-destruction mechanisms, and such other computer instructions purposely and maliciously written to disable, destroy, or otherwise alter the software or hardware on which the Software executes; or reveal any data or other information accessed through or processed by the Software in a manner not intended for the normal operation of the Software. The parties’ acknowledge that the normal and intended operation of the Software includes gathering information about Product performance and usage and gathering debugging information.

k) “Intellectual Property Rights” means all tangible and intangible: (1) right associated with works of authorship throughout the world, including but not limited to, copyrights, moral rights, and maskworks; (2) trademarks and trade name rights and similar rights; (3) trade secret rights; (4) patents, designs, algorithms, and other intellectual and/or industrial property rights (of every kind and nature throughout the world and however designated) whether arising by operation of law, contract, license, or otherwise; and (5) all registrations, initial applications, renewals, extensions, continuations, divisions, or reissues thereof now or hereafter in force (including any rights in the foregoing).

l) “Object Code” means computer-programming code in machine-readable form.

m) “Product(s)” means those Motorola products that may be combined or bundled with the Software on or before the termination or expiration of the Agreement and that interoperate with the Danger Service Software. Each Product will be defined in an SOW and neither party shall have any responsibility with respect to a Product until an SOW is mutually agreed upon.

n) “Publicly Available Software” means (1) any software that contains, or is derived in any manner (in whole or in part) from, any software that is distributed as free software, open source software (e.g. Linux) or similar licensing or distribution models; and (2) any software that requires as a condition of use, modification and/or distribution of such software that such software or other software incorporated into, derived from or distributed with such software (a) be disclosed or distributed in source code form, (b) be licensed for the purpose of making derivative works, or (c) be redistributable at no charge. Publicly Available Software includes, without limitation, software licensed or distributed under any of the following licenses or distribution models, or licenses or distribution models similar to any of the following: (1) GNU’s General Public License (GPL) or Lesser/Library GPL (LGPL); (2) the Artistic License (e.g., PERL); (3) the Mozilla Public License; (4) the Netscape Public License; (5) the Sun Community Source License (SCSL); (6) the Sun Industry Source License (SISL); and (7) the Apache Software license.

o) “Radio Firmware” means the collection of software operating on a Product (typically executed on one or more CPUs and/or DSPs) that is required to provide SMS, voice and data transport via a wireless network as well as debugging output, call control and status information.

p) “Server Software” shall mean Danger’s proprietary Software that interoperates with the Client Software from servers hosted by Danger or its licensees.

q) “Services” means the Support Services as defined in Exhibit B, and services and work Danger will provide Motorola as set forth in the SOW.

r) “Software” means Object Code or Source Code or both, as described in the Specifications, and its Documentation, Enhancements, Updates and Upgrades. Client Software, Server Software, Third-Party Software, Enhancements, Updates and Upgrades, when incorporated, shall be considered “Software.”

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s) “Source Code” means human readable computer programming code.

t) “Statement of Work” or “SOW” means the detailed description of a Product, including but not limited to tasks, deliverables, milestones, timeline or schedule and responsibilities of the Parties. An SOW may be changed only by a document signed by both Parties recording any changes to the SOW (“Change Order”) and new SOWs added upon the mutual written agreement of the Parties. New SOWs will be attached hereto and consecutively numbered as Exhibit A, Exhibit A-1, Exhibit A-2, etc.

u) “Term” shall mean the Initial Term and all Renewal Terms of this Agreement.

v) “Third Party Contractors” shall mean Motorola’s consultants, contractors, representatives, or agents, for whose actions Motorola shall remain responsible.

w) “Third Party Software” shall mean Software that is licensed by Danger or Motorola from a third party and is incorporated into Products.

x) “Update” means any change or addition to the Object Code or Source Code or Documentation to correct errors, support new or revised operating systems, support new input/output devices, or provide error corrections.

y) “Upgrade” means any modification or revision to the Software that warrants a new revision number (x.0) in accordance with industry practices.

2) GRANT OF LICENSE.

a) Object Code License Grant. Subject to the terms and conditions of this Agreement, Danger grants to Motorola a perpetual, worldwide, non-exclusive, fully paid up license, with limited right of sublicense (as described below), to use, make, reproduce, demonstrate, create Derivative Works, market, and/or otherwise distribute Client Software Object Code incorporated into the Product; and to grant End Users the limited right to use the Client Software Object Code solely as incorporated into a Product. Motorola’s sublicense right shall be limited to licensing the Client Software Object Code to third parties that are necessary for the design, manufacture, distribution and/or repair of Products. Motorola shall enter into written agreements with such sublicensees that are at least as protective of Danger’s rights in the Client Software as this Agreement. Danger shall separately sublicense the Client Software to End Users when an End User activates a Product. All rights granted End Users shall survive termination or alteration of this Agreement.

b) Source Code License Grant. To the extent Client Software Source Code is not provided for Software or any component thereof, Danger shall place such Source Code for the Software into escrow with Iron Mountain Property Management/DSI Technology Escrow, subject to the terms of a mutually agreed upon source code escrow agreement attached hereto as Exhibit C. The Client Software Source Code placed into escrow shall include the Source Code for Third Party Software licensed by Danger only to the extent Danger has the rights to do so. Motorola shall bear all costs of the source code escrow. The parties acknowledge that future joint products may require Motorola’s use of Danger’s Source Code; Danger will grant to Motorola an appropriate Source Code license under mutually agreed-upon terms at such time. Licenses to, and delivery schedules for, Source Code will be set forth in SOWs for projects requiring Source Code.

c) Use of Documentation. Danger grants to Motorola and its Third Party Contractors a perpetual, worldwide, non-exclusive, fully paid-up license to use, display, distribute, reproduce, have reproduced, edit, translate, create Derivative Works, and modify Documentation solely for the purpose of developing, manufacturing, distributing, marketing or repairing Products.

3) OWNERSHIP OF SOFTWARE, RESTRICTIONS.

a) Title to the Software will remain in Danger. Title to all Derivative Works, Enhancements and Adaptations made by or paid for by Motorola will remain in Motorola, subject to Danger’s underlying ownership of the Software. Motorola’s rights to use the Software or any portion thereof contained in any Derivative Work, Enhancement or Adaptation shall be limited to the rights granted in Section 2 above and the restrictions of this Section 3. For any work which Motorola pays Danger to perform for Motorola, the parties shall execute a separate agreement that specifies the schedule, scope and ownership rights in such work.

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b) Other than the rights granted in Section 2, no other license, right, or interest is granted to Motorola by implication, estoppel, or otherwise, for any purpose, and any rights not expressly granted are reserved by Danger. Without limiting the foregoing, Motorola shall not, and shall not authorize any third party to: (a) translate, reverse engineer, decompile, disassemble, attempt to derive the Source Code of any Software provided to Motorola solely in Object Code form; (b) modify or create any Derivative Works to the Software; (c) during the term of this Agreement, provide or authorize a third party to provide any functionality or software applications on any Product that enables a service that is directly competitive with the Danger Service Software (i.e., provides similar features or functionality), unless agreed to by Danger in writing (d) sublicense, rent, lease, loan, timeshare, sell, distribute, assign or transfer any rights in, grant a security interest in, or transfer possession of the Software, except as expressly provided in this Agreement; or (e) obfuscate, alter or remove any of Danger’s copyright or other proprietary rights notices or legends appearing on or in the Software or Documentation. The parties acknowledge and agree that the licenses granted by Danger under this Section 3 are restricted to Products that are compatible with the Danger Software (and no other software or services with similar functionality) and that are based on SOWs.

4) DELIVERY, ACCEPTANCE. Danger shall provide its Deliverables to Motorola, [ * ] (Incoterms 2000) [ * ] designated location, for reasonable Acceptance testing in accordance with the SOW. Motorola will provide Notice upon Acceptance of said Deliverables, or details of nonconformities. Danger shall correct such nonconformities within ten (10) days. Upon Acceptance, Danger shall deliver its Documentation. Danger shall [ * ] and [ * ] during the Term and any subsequent support period made available to Danger’s regular commercial customers. Motorola shall provide its Deliverables to Danger in accordance with the SOW. Motorola shall provide appropriate information, support and cooperation to enable Danger to perform its Services according to the SOW.

5) PRODUCT DEVELOPMENT, MANUFACTURING AND SALES

a) Development.

i) [ * ] will, [ * ], determine which specific [ * ] will form the basis for a [ * ]. Motorola will be responsible for the hardware design of each Product and will dedicate sufficient resources to produce hardware designs. The hardware design for each Product will be set forth in the Product SOW that is mutually agreed upon by the parties.

ii) As set forth in each SOW, Danger will assign certain management and engineering resources for Motorola development support that will be able to port the Client Software for each Product with limited software development support from Motorola. Prior to commencing development work on each Product, the parties will mutually agree upon an SOW for the Product that sets forth the specifications, Deliverables and schedule for such Product. The parties will work together to provide APIs, support, access and/or extensions to debug the Products.

iii) Product Lifecycle Management. The parties agree to conduct reviews at least once per [ * ] to evaluate: (a) [ * ] and [ * ] to the Products to ensure customer satisfaction; (b) [ * ] and [ * ] orders; (c) [ * ] to [ * ] Product [ * ] and [ * ]; (d) [ * ] opportunities and (e) [ * ] decisions regarding particular versions of the Product and the [ * ] of support with respect to such Product versions. For Product changes to be implemented following such reviews, the schedule, allocation of costs (if any), and other details for such changes shall be set forth in change orders agreed upon by the parties. Motorola will provide Danger written notice, at least [ * ] prior to discontinuing production (“end of life”) of a Product or parts for a Product.

iv) Roadmap. The parties will cooperate to develop a product roadmap and associated schedule that reflects the direction and future evolution of Products. The roadmap may include plans for major releases of, or other modifications to, Products, such as different industrial designs, cost reductions, and other new features as to which the parties may mutually agree.

v) Operator Promotion and Commitment. Danger and Motorola will jointly promote Products to target mobile operators. Upon execution of this Agreement, the parties acknowledge that one (or more) operators have made a purchase commitment that satisfies Motorola’s and Danger’s requirements to commence development and commercially ship the first Product to be developed hereunder.

b) Testing.

i) Danger, [ * ], will be responsible for testing the Client Software and Service Software with Products internally to confirm compatibility and performance to Motorola. The parties shall set forth specific test plans in the SOW for a particular Product. As set forth in the applicable SOW, Motorola shall provide Danger with engineering verification testing (EVT), design verification testing (DVT) and process verification testing (PVT) Products for testing, evaluation and field trials.

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ii) Motorola, [ * ], shall be responsible for testing Products for compliance with all applicable governmental and industry regulations (including, but not limited to, FCC, PTCRB, UL, CE and GSM requirements) and shall obtain any necessary agency, regulatory, and industry-required approvals (collectively “Regulatory Tests”). In addition, Motorola, [ * ], shall be responsible for performing all Approved Carrier testing and certifications. Provided however, if Motorola is required to perform a [ * ] Test or an [ * ] test because a Product fails such test primarily due to a [ * ], then [ * ] will [ * ] for [ * ] in any such [ * ]tests. For each Product, Danger shall provide Motorola with reasonable support for testing and certifications as mutually agreed to in the applicable SOW.

c) Manufacturing and Distribution.

i) Motorola shall be responsible for Product manufacturing and the fulfillment of orders for Products, including shipping, delivery and payment of any import duties, taxes, environmental charges, etc. Motorola may fulfill these responsibilities itself, or may have its affiliates or other third parties perform these obligations (e.g. use of third party contract manufacturers) on Motorola’s behalf. In any event, Motorola shall be liable for its affiliates and authorized third parties’ performance of these obligations.

ii) Branding. Subject to the requirements of an Approved Carrier, Products shall be branded “Motorola” on the hardware portion of the Product. Danger’s branding will appear on the web-portal Danger hosts for Approved Carriers. The parties may provide for more detailed branding specifications for a particular Product in a Product SOW, including whether Danger’s branding will appear on the Client Software interface for a particular Product.

d) Danger Sales & Marketing.

i) During the term of the Agreement, Motorola will use [ * ] to market and sell the Products to Approved Carriers and other wireless network operators in accordance with the terms of this Agreement. Motorola will provide sales and marketing support for Approved Carriers and other wireless carriers that [ * ] with [ * ] in Motorola’s [ * ] with [ * ]. Motorola shall provide reasonable numbers of demonstration Products, as requested by Danger, at manufacturing cost for Danger’s demonstration and marketing purposes. Motorola shall also make pre-sale demonstration and sample Products available to Approved Carriers and other wireless carriers at favorable terms.

ii) Sales and Marketing Plan. Motorola and Danger agree to collaborate on a sales and marketing plan to be mutually created by the parties within sixty (60) days after the execution of an SOW (the “Sales and Marketing Plan”), which shall include, without limitation, how the parties will jointly approach and manage Approved Carriers and other wireless carriers, the expected price range for the Products, sales thresholds and market catalysts for price changes, target territories for distribution, target sales quotas, and a description of marketing collateral and sales materials. Ninety (90) days prior to the end of each calendar year during the term of this Agreement, the parties agree to negotiate in good faith any modifications and updates to the requirements in the Sales and Marketing Plan for the subsequent year.

6) SUPPORT.

a) Danger Support for Motorola.

i) Support Services. Danger’s Support Services for Motorola are detailed in Exhibit B. Danger covenants to Motorola that such Support Services shall be provided [ * ] to [ * ] and [ * ].

ii) Sales Training. Danger will offer training to Motorola’s channel managers (in English) as mutually agreed upon by the parties. Danger shall provide electronic versions of training materials and sales materials (in English) to Motorola and shall update such materials periodically to provide support for ongoing distribution of Products.

b) Danger Support for Approved Carriers.

i) Customer Support. Danger will provide “train-the-trainer” technical support training sessions with respect to Danger’s Software for Approved Carriers’ support personnel to enable such personnel to perform support services for End Users and other internal support personnel.

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ii) Network Operations Center (NOC) Support. With respect to Products, Danger will provide NOC service support to Approved Carriers as it is currently providing in relation to other wireless devices that interoperate with Danger’s software and services.

iii) Covenant. With respect to Products, Danger will provide Customer Support to Approved Carriers at a level no less than the level that Danger offers for other wireless devices that interoperate with Danger’s software and services such that Products will not be disadvantaged in the marketplace from a Customer Support perspective.

c) Post-Sales Support.

i) Motorola shall be responsible for managing all post-sales support for Products, including, but not limited to, in-warranty and out-of-warranty servicing of Product returns and repairs, reverse logistics management, and replacement or “seed-stock” support to Approved Carriers. All Product repairs and returns from Approved Carriers will be managed through Motorola and its agents.

ii) Quality. Motorola will collect all warranty returns for the Product, and using the methodology set out in the applicable SOW, Motorola will calculate the rate at which the Product is failing in the field on a monthly basis (the “Field Defect Rate” or “FDR”). Motorola will maintain commercially reasonable records with respect to warranty returns, and will provide a report of its findings with respect to the Client Software to Danger on a [ * ] basis. The parties shall work together in good faith to ensure that the Client Software does not contribute more than [ * ]% to [ * ] per [ * ], where “X” will be defined [ * ]. The parties will allocate responsibility for field failures as follows:

(1) For Client Software based repairs, Danger will be responsible as set out in the applicable SOW;

(2) For hardware based repairs, and any software based repairs allocated to [ * ] in the applicable SOW (e.g. Radio Firmware), [ * ] will be responsible; and

(3) For all other returns the parties will allocate responsibility as [ * ].

Specifics for each Product and/or carrier will be covered in each associated SOW.

7) PAYMENT, TAXES AND AUDITING.

a) Motorola will pay any NRE fees and other payments per the terms of the applicable SOW. Motorola will pay all items set forth in an SOW net [ * ] days following the date of receipt of Danger’s true and correct invoice. Except as otherwise stated in an SOW, [ * ] or otherwise in [ * ]. Motorola [ * ] Motorola has received written confirmation that Danger has deposited any necessary Source Code into escrow.

b) Motorola shall pay any and all fees, currency conversion costs, taxes and other costs or charges on all payments and transfers to Danger (excluding taxes to which Motorola is exempt), exclusive of any income taxes calculated on Danger’s net income, for which Danger is solely responsible. To the extent that Motorola is required by law to withhold income-based taxes based upon Danger’s income, Motorola will deduct such tax from the fees payable to Danger and remit them to the appropriate government authorities; provided that Motorola promptly sends Danger a certificate showing the payment of such tax.

c) Reporting. Within [ * ] days of the end of each calendar quarter, Motorola will report to Danger Product shipments for such calendar quarter.

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8) EXCLUSIVITY / TIME TO MARKET ADVANTAGE.

a) Subject to the terms and conditions of this Agreement, and except for [ * ], Motorola will be the exclusive distributor of the Client Software on mobile devices for [ * ]. Motorola’s rights under this Section 8 shall terminate upon the occurrence of any of the following:

i) Failure to meet any of the following “Milestones” solely based on Motorola’s (or its agents’) failure

(1) Milestone 1: [ * ] within [ * ] days following the execution of this Agreement. The parties shall work in good faith to [ * ] the [ * ] within such [ * ] day period.

(2) Milestone 2: completing [ * ] to Danger for the [ * ] hereunder by [ * ]; or

(3) Milestone 3: [ * ] with an [ * ] by [ * ].

ii) The commercial shipment of a Product does not happen by [ * ] based on [ * ], or in any event does not happen by [ * ].

iii) If within [ * ] months of the first commercial shipment of a Product, Motorola has not sold and shipped [ * ] units.

b) Notwithstanding Motorola’s exclusivity rights in this Section 8, in the event that [ * ], Danger shall have the right to [ * ] and [ * ] [ * ]. “[ * ]” shall mean an original [ * ] or a [ * ] with a [ * ] not greater than [ * ]

c) Notwithstanding the parties’ rights in Joint Information in Section 10, for any Motorola initiated Enhancements that are Joint Information under this Agreement, Danger shall not permit or enable any party other than Motorola to distribute such Enhancements for use on or with a mobile device, until the earlier of (i) the date of [ * ] of each such Enhancement on a Product or (ii) [ * ] after Danger’s [ * ] of the Enhancement in a commercial release candidate form. An Enhancement will be deemed initiated by Motorola if Motorola [ * ] through a [ * ] and such feature is not [ * ].

9) CONFIDENTIALITY.

a) Each Party agrees that all business, technical, financial and other information that it obtains from the other is the confidential property of the disclosing Party (“Confidential Information” of the disclosing Party) and shall be marked with a suitable legend. The receiving Party will hold in confidence and with reasonable care and not use or disclose any Confidential Information of the disclosing Party except under a ‘need to know’ basis and shall similarly bind its employees and contractors in writing. Upon termination of this Agreement or upon request of the disclosing Party, the receiving Party will return to the disclosing Party or destroy (and certify such destruction) all Confidential Information of such disclosing Party, all documents and media containing such Confidential Information and any and all copies or extracts thereof. The receiving Party shall not be obligated under this section with respect to information the receiving Party can document: (1) is or has become readily publicly available without restriction through no fault of the receiving Party or its employees or agents; or (2) is received without restriction from a third Party lawfully in possession of such information and lawfully empowered to disclose such information; or (3) was rightfully in the possession of the receiving Party without restriction prior to its disclosure by the other Party; or (4) was independently developed by employees or consultants of the receiving Party without access to such Confidential Information; or (5) is required to be disclosed by law or order of court of competent jurisdiction. The Parties agree that breach of these obligations may result in irreparable harm to the disclosing Party for which damages would be an inadequate remedy and the disclosing Party shall be entitled to seek equitable relief, including injunction, in the event of such breach. Either party may disclose this Agreement to its auditors, attorneys and investors provided such parties are bound to keep this Agreement confidential.

b) Either Party shall be unrestricted in its use of Residuals for any purpose, including use in the development, manufacture, promotion, sale and maintenance of its products and services; provided, that no license under any patents, copyrights or mask work rights of the disclosing party is thereby conveyed. The term “Residuals” means information of a general nature, such as general knowledge, ideas, concepts, know-how, professional skills, work experience or techniques (not specifics such as exact implementations) that is retained in the unaided memories of the receiving party’s employees who have had access to the disclosing party’s information pursuant to the terms of this Agreement. An employee’s memory is unaided if the employee has not intentionally memorized the Information for the purpose of retaining and subsequently using or disclosing it.

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c) Notwithstanding the foregoing, the parties agree and understand that either party may be developing similar products and services to those being discussed hereunder. Nothing in this Agreement shall prevent either party from developing such similar products and services. Additionally, this Agreement shall not prevent the movement of employees within Motorola.

10) INTELLECTUAL PROPERTY RIGHTS.

a) “Joint Information” means any newly developed technical information, software, design tools, documentation and any related information which is developed by a contribution of one or more of Danger’s employees or agents jointly with one or more of Motorola’s employees, agents or consultants during the Term. Joint Information does not mean and does not include any underlying information developed prior to the effective date of this Agreement or during the Term solely by Danger or Motorola. Joint Information does not include Danger Information or Motorola Information (as defined herein).

b) “Motorola Information” means any underlying information developed prior to the effective date of this Agreement by Motorola or newly developed technical information, software, design tools, documentation and any related information which is developed by Motorola without the assistance or input of any of Danger’s employees or agents. Motorola shall own all right, title and interest in and to all Motorola Information.

c) “Danger Information” means any means any underlying information developed prior to the effective date of this Agreement by Danger or newly developed technical information, software, design tools, documentation and any related information which is developed by Danger without the assistance or input of any of Motorola’s employees or agents. Danger shall own all right, title and interest in and to all Danger’s Information.

d) All Joint Information, except publicly known information, will be in written or in other tangible form, marked “Danger-Motorola Proprietary” and will be maintained confidential by both parties during the term of this Agreement and for three (3) years thereafter. The Parties will own the Joint Information jointly. Either Party may file patent applications for inventions conceived or made by its employees or agents or consultants during the Term, which inventions are not made jointly with employees or agents of the other Party, but neither Party will be required to file such patent applications, secure any patent or maintain any patent. Joint patents will be jointly owned by the Parties. The Parties will cooperate to handle prosecution and administration of the jointly owned patents. Jointly owned patents may be used for any and all purposes and the Parties are free to license third parties under the joint patents without any accounting to each other. The Parties will mutually agree on which inventions and in which countries patent applications are to be filed, and which Party will file for the patent. The Parties will cooperate in filing patent applications and other formalities required to protect or enforce their joint Patent rights. Neither Party will be required, however, to incur any costs, such as patent application costs, to which it has not agreed. If, after the Parties meet and discuss matters relating to obtaining patent protection for jointly-owned inventions, one Party does not want to pursue filing a patent application on any joint inventions in any country, the other Party may independently pursue patent protection of the invention in such country on behalf of that party only at that party’s sole expense. The Party who so pursues patent protection in such country will be the sole owner of any resulting issued patent in such country and will be entitled to all revenues derived by such Party relating to the resulting issued patent, provided, however, that the other party will have a worldwide, non-terminable, nonassignable (except in a merger or acquisition), non-exclusive, royalty-free license under such resulting patent within such country and for the full term of such patent, to make, have made, use, and sell products or processes utilizing or embodying the subject matter claimed in such patent. Nothing in this section will be construed as granting a technology license.

e) Either Party shall be unrestricted in its use of Feedback for any purpose, including use in the development, manufacture, promotion, sale and maintenance of its products and services; provided, that no license under any patents, copyrights or mask work rights of the disclosing party is thereby conveyed. The term “Feedback” means fixes, suggestions, advice or corrections that one party provides to the other for the other party’s proprietary “Information” (i.e. Danger provides Feedback to Motorola for the Motorola Information and visa-versa).

11) WARRANTIES.

a) Danger represents and warrants that, except as described in Exhibit D, as of the Effective Date there are no unresolved claims or pending litigation asserted against Danger that relate to Intellectual Property Rights in the Client Software, trademarks or any part thereof. Danger represents and warrants that, to its knowledge, the Client Software includes no Illicit Code. Danger represents and warrants that it neither has nor will take any actions that (1) create, or purport to create, any obligation on behalf of Motorola, or (2) grant, or purport to grant, any rights or immunities to any third party under Motorola’s Intellectual Property Rights or its other proprietary rights.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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b) Danger represents and warrants that, for a period of [ * ] from the [ * ], (1) the Client Software version/release applicable for such unit will perform in conformance with the Specifications and its Documentation; provided that the Client Software is used as specified in the Documentation; (2) Danger will provide [ * ], and [ * ] with the [ * ]; and (3) Danger will correct any failure, malfunction, defect, or nonconformity in the latest Client Software version/release applicable for each Product following written notice that such Client Software is not in conformance with its Specifications and Documentation as specified in the applicable SOW. Any such written notice shall provide sufficient detail on the failure, malfunction, defect, etc. for Danger to diagnose and recreate the issue; provided however, if Danger is unable to reproduce the issue, the parties shall continue to work together to identify and resolve the purported issue. The foregoing warranties do not apply to errors, defects, or non-conformities due to (1) misuse of the Software solely by Motorola; (2) unauthorized modification of the Software by Motorola; or (3) failure of Motorola to use compatible hardware and Radio Firmware as set forth in the Specifications.

c) OTA. The parties agree that any defects, errors, malfunctions, etc. of the Client Software on Products already distributed to End Users shall be cured, [ * ], by [ * ] of the Client Software to such Products. [ * ] will be responsible for any costs associated with the delivery of [ * ] for Client Software. The parties shall discuss how to allocate costs and whether [ * ] will charge a fee for the delivery of [ * ] for software that is not Client Software (e.g. Radio Firmware). The parties acknowledge that any [ * ] shall be subject to the requirements of Approved Carriers. Responsibility for defects found in software that is delivered via [ * ] shall be allocated pursuant to [ * ].

d) Remedy. In the event of a breach of the warranties provided for in subsections (a) and (b) above, Danger shall promptly provide Motorola with a new version or release of the Client Software that conforms to the above warranties. [ * ] shall [ * ] as soon as possible. However, if, [ * ] after receipt of Motorola’s notice, Danger has failed provide conforming versions of the Client Software, Danger shall be deemed to be in material breach of the warranties in this Section 11 and Motorola may exercise its rights and remedies as set forth in this Agreement, at law, equity or otherwise with respect to such material breach. The Parties may agree to additional warranties and remedies in an applicable SOW.

e) Warranties for Publicly Available Software.

i) Danger warrants that it has processes and precautions [ * ], or any other [ * ], will be [ * ] to the [ * ] or otherwise into the [ * ], as a result of Danger’s activities pursuant to this Agreement. Danger warrants that for any [ * ] included in the [ * ], no portion of such [ * ] shall [ * ] Software, and Danger will not [ * ] such [ * ] in [ * ] as to [ * ], or any other [ * ], [ * ] by such [ * ] as a result of the activities contemplated pursuant to this Agreement.

ii) Motorola warrants that it has processes and precautions [ * ], or any other [ * ], will be [ * ] to the [ * ] or otherwise into the [ * ], as a result of Motorola’s activities pursuant to this Agreement. Motorola warrants that for any [ * ] included in the [ * ], no portion of such [ * ] shall [ * ] software, and Motorola will not [ * ] such [ * ] in [ * ] as to [ * ], or any other [ * ], [ * ] by such [ * ] as a result of the activities contemplated pursuant to this Agreement.

f) Danger represents and warrants that during the term of this Agreement or any extension thereof, Danger will not [ * ] the license of the Client Software [ * ].

g) EXCEPT FOR THE WARRANTIES EXPRESSLY SET FORTH IN THIS SECTION, DANGER DISCLAIMS ALL WARRANTIES, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO ANY SOFTWARE, INCLUDING THE IMPLIED WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. THE WARRANTIES SET OUT IN THIS SECTION ARE IN LIEU OF ALL LIABILITIES OR OBLIGATIONS OF DANGER FOR DAMAGES ARISING OUT OF OR IN CONNECTION WITH THE DELIVERY, USE, OR PERFORMANCE OF THE SOFTWARE. DANGER DOES NOT WARRANT THAT THE SOFTWARE IS ERROR-FREE OR WILL OPERATE WITHOUT INTERRUPTION, NOR DOES DANGER MAKE ANY WARRANTY REGARDING THE USE OF THE SOFTWARE OR THE RESULTS THEREFROM INCLUDING, WITHOUT LIMITATION, THEIR CORRECTNESS, ACCURACY OR RELIABILITY.

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12) INTELLECTUAL PROPERTY INDEMNIFICATION.

a) Danger shall defend or settle at its expense any claim or suit brought against Motorola by a third party arising out of or in connection with any assertion that the [ * ], the [ * ] or any [ * ] and shall indemnify and hold harmless Motorola from damages, costs, and attorneys’ fees, if any, finally awarded in such suit or the amount of the settlement thereof; provided that (1) Danger is promptly notified in writing of such claim or suit, (2) Danger shall have the sole control of the defense and/or settlement thereof, and (3) Motorola furnishes to Danger, on request, all relevant information available to Motorola and reasonable cooperation for such defense. The foregoing in this section shall be the sole obligation of Danger and the exclusive remedy of Motorola with respect to any alleged infringement of any third party’s Intellectual Property Rights. Motorola shall not admit or settle any such claim or suit without the prior written consent of Danger.

b) If use of Client Software, Server Software or Danger provided Third Party Software is enjoined, Danger must, at its own expense: (1) procure for Motorola the right to continue using such Software; or (2) replace or modify such Software with a functional, non-infringing equivalent. If Danger is unable to either procure the right to continue to use such Software or replace or modify such Software, Danger may terminate the license(s) granted only in those jurisdictions where the use of such Software is infringing and refund the license fee(s) paid. The parties agree that this indemnity will extend to any such replacement or modified Software. The Parties agree this refund constitutes liquidated damages and is not a penalty.

c) Motorola shall defend or settle at its expense any claim or suit brought against Danger by a third party arising out of or in connection with any assertion that (i) the [ * ], the [ * ], the [ * ] or the [ * ], or (ii) the [ * ] (including but not limited [ * ]) and shall indemnify and hold harmless Danger from damages, costs, and attorneys’ fees, if any, finally awarded in such suit or the amount of the settlement thereof; provided that (1) Motorola is promptly notified in writing of such claim or suit, (2) Motorola shall have the sole control of the defense and/or settlement thereof, and (3) Danger furnishes to Motorola, on request, all relevant information available to Danger and reasonable cooperation for such defense. The foregoing in this section shall be the sole obligation of Motorola and the exclusive remedy of Danger with respect to any alleged infringement of any third party’s Intellectual Property Rights. Danger shall not admit or settle any such claim or suit without the prior written consent of Motorola.

d) If use of any Motorola Software, Motorola provided Third Party Software or the Motorola Deliverables is enjoined, Motorola must, at its own expense: (1) procure for the parties the right to continue using such Software and Deliverables; or (2) replace or modify such Software or Deliverables with a functional, non-infringing equivalent. If Motorola is unable to either procure the right to continue to use such Software or Deliverables or replace or modify such Software or Deliverables, Motorola may terminate the license(s) granted only in those jurisdictions where the use of such Software or Deliverable is infringing and refund amounts paid by Danger to Motorola. The parties agree that this indemnity will extend to any such replacement or modified Motorola Software, Motorola provided Third Party Software and Motorola Deliverables. The Parties agree this refund constitutes liquidated damages and is not a penalty.

13) LIMITATION OF LIABILITY. EXCEPT FOR EACH PARTY’S OBLIGATIONS UNDER SECTIONS 9 (CONFIDENTIALITY) AND 12 (INDEMNIFICATION), IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER FOR INDIRECT, INCIDENTAL, PUNITIVE, SPECIAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND OR NATURE ARISING OUT OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION, LOSS OF PROFITS, LOSS OR INACCURACY OF DATA, OR LOSS OF USE DAMAGES, OR ANY BREACH OF THIS AGREEMENT, EVEN IF THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. EXCEPT FOR EACH PARTY’S OBLIGATIONS UNDER SECTIONS 9 (CONFIDENTIALITY), AND 12 (INDEMNIFICATION), THE TOTAL LIABILITY OF EITHER PARTY TO THE OTHER PARTY FOR ANY AND ALL CLAIMS RELATING TO OR ARISING UNDER THIS AGREEMENT WILL BE LIMITED TO [ * ]. THESE LIMITATIONS SHALL APPLY DESPITE THE FAILURE OF THE ESSENTIAL PURPOSE OF ANY REMEDY.

14) TERM AND TERMINATION.

a) Term. This Agreement shall be effective on the Effective Date and will remain in full force and effect for a period of three (3) years (the “Initial Term”). Thereafter, this Agreement shall automatically renew for subsequent one (1) year periods (each, a “Renewal Term”), unless either Party terminates this Agreement by written notice to the other Party at least one hundred and twenty (120) days prior to the end of the Initial Term or any Renewal Term.

b) Termination. Either Party may terminate this Agreement for the following instances of default and will be entitled to exercise any remedies available to it at law or in equity if:

i) A Party fails to cure any material nonperformance of its obligations, or material breach of any term or condition, within thirty (30) days after receipt of written notice.

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ii) A Party becomes insolvent or makes an assignment for the benefit of creditors or ceases to do business or institutes or has instituted against it any proceedings for bankruptcy, reorganization, insolvency, or liquidation or other proceedings under any bankruptcy or other law for the relief of debtors; and does not terminate such proceedings within ninety (90) days. All rights and licenses granted under or pursuant to this Statement of Work are, for purposes of Section 365(n) of the United States Bankruptcy Code (or any other section(s) of the United States Bankruptcy Code that address rights in executory contracts), 11 USC Section 101 et seq. (the “Bankruptcy Code”), licenses of rights to “intellectual property” as such term is defined under the Bankruptcy Code. The Parties agree that Motorola, shall retain and may fully exercise all of its rights and elections under the Bankruptcy Code, and that Motorola shall have the right to retain and enforce its rights under each valid Statement of Work.

c) Survival. Upon expiration or termination of this Agreement the obligations that, by their nature should survive termination or expiration of the Agreement shall so survive.

15) MISCELLANEOUS.

a) Notices. Except as otherwise provided for herein, all notices required by, or permitted to be given to, Motorola hereunder shall be in writing (including telegraphic communication) and shall be sent by registered mail (return receipt requested and postage prepaid), facsimile, overnight or two-day courier or delivered-in-person (“Notice”) and shall be addressed as follows:

If to Motorola:	With copy to:	If to Danger:	With copy to:
Motorola, Inc. Mobile Devices Business Development 600 N. U.S. Highway 45 Libertyville, IL 60048 U.S.A. Attn.: Vice President, Business Development Phone: [ * ] Fax Number:	Motorola, Inc. 600 N. U.S. Highway 45 Libertyville, IL 60048 U.S.A. Attn.: Law Department Fax: [ * ]	Danger, Inc. Attn: Chief Financial Officer 3101 Park Blvd. Palo Alto, CA 94306 Phone: [ * ] Fax: [ * ]	Danger, Inc. Attn: General Counsel 3101 Park Blvd. Palo Alto, CA 94306 Phone: [ * ] Fax: [ * ]

Mailed notices given as herein provided shall be considered to have been given seven (7) days after the mailing thereof, telegraphic or facsimile notices shall be considered to have been given on the day sent, overnight or two-day courier sent notices shall be considered to have been given three (3) days after sending, and delivered in person notices shall be considered to have been given on the day of delivery.

b) Governing Law and Dispute Resolution. The laws of Illinois, disregarding its conflict of law provisions, govern this Agreement. The parties disclaim application of the United Nations Convention on Contracts for the International Sale of Goods. The state and Federal courts in Cook County, Illinois will have the exclusive jurisdiction and venue for any action under this Agreement and each party irrevocably agrees and submits to the exclusive venue and jurisdiction of these courts.

c) Force Majeure. Neither Party shall be liable to the other for a failure to perform any of its obligations under this Agreement, except for payment obligations, due to circumstances beyond its reasonable control, provided such Party provides Notice of the delay.

d) Relationship of the Parties. Each of the Parties shall be independent contractors in all aspects of this Agreement. Nothing in this Agreement will be deemed to constitute or create an agency, a joint venture, partnership, pooling arrangement, or other formal business entity or fiduciary relationship between Motorola and Danger.

e) No Exclusivity. Each Party shall carry out its commitments under this Agreement in a manner that reflects favorably upon the good name and goodwill of the other Party. The Parties agree that the commitments under this Agreement are not exclusive and that, except as described in Section 8, either Party may enter into similar agreements with third parties, including either Party’s competitors.

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f) Assignment. Neither Party may assign this Agreement or any of its rights or obligations hereunder without the express written consent of the other Party. For purposes of this Agreement, a change in ownership of Danger shall be deemed an assignment. Notwithstanding the foregoing, Danger may assign this Agreement without Motorola’s prior written consent to a successor in interest to all or substantially all of Danger’s assets, capital stock or business that is not a [ * ]. For the purposes of this Agreement, a “[ * ]” shall mean a [ * ].

g) Ethical Standards. Both parties will refrain from activities that are illegal, unethical or which might bring either Party or their respective products into disrepute or which might constitute or represent a serious conflict of interest or which might give the appearance of impropriety. Both parties will co-operate fully in any investigation or evaluation of such matters.

h) Compliance with Laws. Both parties agree to comply with all applicable laws, regulations and standards of all jurisdictions applicable to the Product and services delivered and each Party’s performance under this Agreement.

i) Export Laws. Motorola shall not export from anywhere any part of the Software or any direct product thereof except in compliance with, and with all licenses and approvals required under, applicable export laws, rules and regulations. To the extent that any such export laws, rules or regulations prohibit Motorola from complying with any of its obligations hereunder, such failure shall be excused and shall not constitute a breach of this Agreement.

j) Equal Employment Opportunity, Affirmative Action, and Forced Labor.

i) Danger agrees to comply with any and all applicable federal, state, and local equal employment opportunity, affirmative action, laws, statutes, rules, regulations, ordinances, and other guidelines.

ii) Utilization of Small Business Concerns: If applicable, Service Provider will comply with (i) the provisions of U.S. Federal Acquisition Regulation (FAR) 52.219-8 pertaining to Utilization of Small Business Concerns and (ii) other state, and local small and other business utilization laws.

iii) Equal Opportunity: If applicable, Service Provider will comply with the provisions of the U.S. Federal Acquisition Regulation (FAR) 52.222-21, 52.222-26, 52.222-35 and 52.222-36 pertaining to Segregated Facilities, Equal Opportunity, Equal Opportunity for Veterans, and Affirmative Action for Workers with Disabilities. If applicable, Service Provider will maintain, at each establishment, affirmative action programs required by the rules of the U.S. Secretary of Labor (41 CFR 60-1 and 60-2).

iv) Danger represents that that material and services provided under this Agreement are not produced, manufactured, mined, or assembled, in whole or part, with the use of forced, convict, and/or indentured labor under penal sanction as prohibited by any state law or U.S statute, including any class of labor specified in section 307, Tariff Act of 1930, as implemented in 19 C.F.R. 12.42.

k) Severability. If any provision of this Agreement is held to be invalid, illegal, or unenforceable, the remaining provisions hereof shall be unaffected thereby and remain valid and enforceable as if such provision had not been set forth herein. The parties agree to substitute for such provision a valid provision that most closely approximates the intent of such severed provision.

l) Waiver. Failure or delay by either Party to exercise any right or power under this Agreement will not operate as a waiver of such right or power.

m) Controlling Terms. The Parties agree that the terms and conditions set out herein shall control over any terms that may appear in any purchase order, acceptance, acknowledgement, registration form, quotation, invoice, or other writing, and will not be binding on the parties unless specifically agreed to in writing signed by each Parties’ authorized representatives. If a conflict arises between any Exhibit and the terms and conditions herein, these terms and conditions will take precedence over any Exhibit.

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n) Publicity. Neither Party shall have the right to use the trade names or trademarks of the other Party without prior written consent. Neither Party shall publicize the terms and conditions of this Agreement.

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EXHIBIT A

PRODUCT STATEMENT OF WORK

LICENSED SOFTWARE; TECHNICAL AND FUNCTIONAL SPECIFICATIONS

(INCLUDING DEVELOPMENT AND DELIVERY MILESTONES & ACCEPTANCE TEST CRITERIA)

I. Scope. This SOW is for the “Zante” Product.

II. Term and Termination. Term. This Statement of Work shall be effective on the Effective Date of the Agreement and will remain in full force and effect for a period commensurate with the term of the Agreement.

III. [ * ] Fees.

A. Motorola will [ * ] on each Product defined by this SOW manufactured by or on behalf of Motorola.

B. [ * ] shall be responsible for [ * ] specified in the Table III-1 below. However, in no case shall [ * ] be responsible for [ * ] relating to [ * ], except where [ * ] is [ * ] via the [ * ] that requires [ * ]. [ * ] must [ * ] of the Agreement that would [ * ] to [ * ], including but not limited to [ * ]. [ * ], as currently defined, will include, but is not limited to, the following [ * ]. Vendor names listed below may change if sourced from a different vendor as mutually agreed. [ * ] shall be liable for any [ * ] fee(s) that is not listed in Table III-1 below or that is added after the Effective Date of the Agreement without [ * ] written approval and agreement as to which Party is responsible for paying the license fees for such [ * ]. Danger will provide a list of all software versions [ * ] and thereafter update the list monthly.

Table III-1

[ * ] Description	Vendor	Paid By
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]
[ * ]	[ * ]	[ * ]

IV. Client Software Warranty Period. The duration of the warranty period for the Client Software shall be a period of [ * ]. [ * ] shall not extend the Warranty Period or initiate a new Warranty Period. [ * ] shall have no liability for [ * ] due to [ * ] in the [ * ] for Products manufactured [ * ] of an [ * ] (if required) and [ * ] that [ * ] if the [ * ] was not [ * ] in the [ * ].

V. Deliverables. All documents listed are hereby incorporated by reference into this SOW. If only parts of the documents are relevant to this project, they are specifically noted

A. Deliverables/Outputs. The parties will provide the following Deliverables:

1. Software. – supplied by Danger

a. [ * ]

2. Software Documentation (in electronic format, in English) – supplied by Danger.

a. [ * ]

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3. Software Training – supplied by Danger.

a. [ * ]

4. Hardware – supplied by Motorola.

a. Motorola shall provide Danger, [ * ] for testing, evaluation and field trials.

B. Standards/Specifications. The Deliverables will meet the following standards and specifications:

1. Software/Hardware: The Product will conform to the following requirements:

OS	Based on hiptop OS and Software Release 3.0 plus applicable updates and new releases.
Phone	Supports handheld, hands-free, and speakerphone modes, Customizable ringtones and Caller ID images, Voicemail, Call forwarding, Hold, Mute, Multi-party calling, Call log
Web Browser	HTML 4.0 Web Browser, SSL Support, Cookies support
E-Mail Client	Push email solution (“Instant email”) Fetch from device account and up to 3 POP3/IMAP accounts Transcoding support for of MS Word, Adobe Acrobat & Image attachments Playback support for WAV sound file attachments
SMS	Short Message Service (SMS) Store messages on device or SIM Card Send/Receive Concatenated SMS Delivery Reports Reply Request
MMS	Multimedia Messaging Service (MMS) (Optional) Compose MMS with up to 3 slides Include a picture, sound, or a 20 second voice note on each slide. Digital Rights Management: Forward Lock
Instant Messaging	AIM, MSN Messenger and Yahoo Messenger clients available (Optional, at additional cost to Carriers) Full Buddy List functionality, Instant Buddy List updates
PIM Applications	Address Book, Contact sharing through Send/Receive of vCards, Calendar, To Do, Notes
Camera Gallery (Optional)	Captures of images from device camera Night mode options Stores up to 36 images, Photo Caller ID
Gaming and Entertainment	Mutually agreed upon game (optional per carrier) Premium Download Manager supports purchase and management of Ringtones and Applications Sonic Boom music player
Carrier-specific features	“My Faves” will be included in the software version for T-Mobile US

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2. Hardware:

a. [ * ]

C. Documentation of Schedule / Milestones for Deliverables. The following schedule states the target dates and performance milestones for the preparation and delivery of the Deliverables by the parties:

1. [ * ]

D. Milestone Reviews: The parties agree to have weekly conference calls and monthly face-to-face meetings to review program status and milestones.

VI. Roles and Responsibilities. The following “Work Breakdown Schedule” will be the basis of roles and responsibilities of the parties, all schedules and, as applicable, cost performance reporting.

A. Staffing. Work on the project shall be lead by the following persons from each Party:

1. Danger: [ * ]

2. Motorola: [ * ].

B. Roles and Responsibilities of the Parties as set forth in Schedule 1, as updated from time to time

C. The Program Manager will be each party’s point of contact for all technical and other details with the other party. Each party represents that its Program Manager shall have direct access to such party’s senior corporate managers, and maintain a close liaison with the other party’s Program Manager and program management representatives. The designation of a point of contact for each party is not intended to constrain each party’s management approach or to prevent direct communication between the parties’ project teams. The designation should clarify who bears ultimate responsibility for the success of each party’s efforts.

a. Danger’s Program Manager (including address, phone, fax, email) will be: [ * ]

b. Motorola’s Program Manager (including address, phone, fax, email) will be: [ * ].

D. Motorola-Furnished Information and Equipment. Describe the data and equipment to be provided to Danger.

1. Motorola shall provide Danger, [ * ] for testing, evaluation and field trials. The allocation of such [ * ]. In addition, as requested by [ * ] shall provide [ * ] with additional [ * ].

VII. Software Development Activities.

A. Software Design. The software design criteria and requirements are:

1. Feature Complete. New features development is complete. Development team will transition to system integration and bug fixing. All features have been implemented according to the feature requirements and the unit has been tested by the developers.

2. Alpha. Alpha represents the first stable build. The feature set is frozen. A build is sent to the licensee(s) to create their acceptance test and pass their test to Danger.

3. Beta

a. The Software/client/service includes all the functionality required to meet the release goals. Licensees are actively testing the software and submitting bugs.

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b. Danger provides the following:

i. Danger forms an external test group.

ii. Upgrades are made available for download.

iii. Release notes for each build are posted.

4. Final Candidate. All bugs against the release have either been resolved or postponed. Software is considered to be release quality. The goal of this period is to pass final internal QA testing and licensee/partner acceptance.

B. Software Implementation and Unit Testing. Danger will perform the following tests and perform the following inspections:

1. Feature complete -

a. Prerequisites to entering SQA Feature Complete

i. Feature complete test cycle is run

ii. SQA identifies the build that is feature complete

iii. Software passes all test cases in the Feature Complete test cycle

2. Alpha

a. Prerequisites to entering SQA Alpha

i. No open P1 defects

ii. No test blocking bugs are open

iii. Final product feature set has been determined

iv. All features have been tested on launch platforms

3. Beta

a. Prerequisites to entering SQA Beta

i. All components in release have passed the Alpha milestone

ii. All P1 and P2 defects are in the fixed state

iii. P3 and other defects we are not fixing in this release are postponed

iv. Bug fix rate exceeds find rate consistently for two weeks

4. Final Candidate

a. Prerequisites to entering SQA Final Candidate

i. All bugs addressed via patches to final beta roll.

ii. 100% of Beta test cases completed on final versions of all HW platforms.

iii. All stress and load testing completed.

iv. Support declares the product is supportable/ready to ship.

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v. QA-qualified bugs re-verified in final version.

vi. Final version selectively regression tested with no new bugs.

vii. Bug find rate is lower than fix rate and steadily decreasing.

viii. Beta testing with external users complete.

ix. No Final candidate blocking bugs in existence.

VIII. Software Product Discontinuance and End of Life Support. [ * ] shall give [ * ] [ * ] months written notice prior to issuance of an [ * ] for the Product. Following the issuance of such [ * ] shall provide support for the [ * ] only for the [ * ] or [ * ] following issuance of the [ * ], whichever is longer. [ * ] shall give [ * ] prior written notice of [ * ]. [ * ] shall have no obligation to provide support for any [ * ] following the expiration of the [ * ] notice period.

IX. Warranty

A. In Section 11(b) of the Agreement, Danger represents and warrants that, for a period of [ * ], the Client Software in such unit will perform in conformance with the Specifications and its Documentation; provided that the Client Software is used as specified in the Documentation. For this SOW, the parties also agree as set out below.

B. In Section 6(c)(ii) of the Agreement, the parties agreed that [ * ] will collect all warranty returns for the Product, and using the methodology set out in subsections (C) and (D) below in this SOW, Motorola will determine on a [ * ] basis, (1) the [ * ] for each Product and (2) the [ * ] to the FDR for the Product (the “[ * ]”). Motorola will maintain commercially reasonable records with respect to warranty returns, and will report Client Software Based Repairs (“CSBRs”) (as defined below) to Danger in accordance with Section H below. Danger shall have the right to review such records on reasonable notice, times and frequency, [ * ] to FDR or [ * ], and [ * ]. [ * ] shall provide at least [ * ].

C. In Section 6(c)(ii) of the Agreement, the parties agreed Motorola will calculate the FDR for the Product.

FDR shall be determined as follows:

1. FDR for any given month is a fraction: the numerator is [ * ] (as defined below) for the month, and the denominator is [ * ] (as defined below) for the month.

2. [ * ] is calculated as follows: [ * ] for any reason less [ * ] months prior to the return. [ * ] shall not include any [ * ]

3. [ * ] is calculated as follows: [ * ]-month period.

4. Accessories that are defective are [ * ] of Product; [ * ] configuration are counted.

5. For the purposes of this Agreement, the month within which Ship Authorization of the Product occurs is Month 1 if commercial shipment occurs on or before the 15th day of that month, the second full month thereafter is Month 2, the third full month is Month 3, and so on. If commercial shipment occurs after the 15th day of a month, the first full month thereafter is Month 1, the second full month is Month 2, and the third full month is Month 3, and so on. “Ship Authorization” is defined as the date when (1) the Approval Certificate has been issued for production of the Product and (2) Motorola’s internal requirements to permit production units of a Product to be shipped by the ODM have been met.

D. In Section 6(c)(ii) of the Agreement, the parties agreed Motorola will report its finding with respect to CSBRs to Danger and that the parties would [ * ] to ensure the Client Software does not contribute more than X% to the FDR per month, where “X” will be set forth in this SOW. For this SOW the parties agree to use [ * ] to ensure the SW Contribution to FDR will not exceed [ * ]%.

“SW Contribution to FDR” shall be determined as follows:

1. SW Contribution to FDR for any given month is a fraction: the numerator is [ * ] (as defined below) for the month, and the denominator is the [ * ] (as defined in Section C above) for the month.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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2. CSBRs are calculated as follows: [ * ] in the categories listed as [ * ] below with a multiplier of [ * ] applied to the resulting total to account for repairs that may have been caused by [ * ].

a. All of the Primary Repair Descriptions that begin with [ * ], plus

b. All of the Primary Repair Descriptions entitled [ * ].

3. [ * ]. Due to the difficulty of initially identifying a [ * ] defect versus a [ * ] defect, the parties agree to allocate [ * ]% of all [ * ] that begin with [ * ] to [ * ] repairs. Danger shall not be obligated to [ * ]. The parties shall [ * ] (in the case of [ * ]) or [ * ] (in the case of [ * ]) as mutually agreed. Danger will provide [ * ] debugging support to Motorola and Motorola’s manufacturing and repair partners in order to identify [ * ] bugs and correct errors. Such support shall be subject to [ * ] providing (at their expense) to Danger [ * ] and [ * ]. [ * ] shall also [ * ] for any [ * ].

E. In Section 6(c)(ii)(1) of the Agreement, the parties agreed, for CSBRs, Danger would be responsible. For this SOW, the parties also agree as set out below.

1. At the end of each [ * ] period following Ship Authorization for the Product (the “[ * ] Periods”), Danger will make a service payment to Motorola (the “Service Payment”) equal to the sum of [ * ] multiplied by the number of [ * ] during each such [ * ] Period that exceeds the sum of the [ * ] during each of the months in such [ * ] Period multiplied by [ * ]%.

2. Expressed as a formula, the concept is as follows: Service Payment = [ * ]]

3. Danger will pay Motorola’s Service Payment invoices [ * ] days after date of invoice.

4. Except as set forth in Section F(2) below, Danger’s financial liability to Motorola for breach of its Client Software warranty in Section 11(b) shall be limited Service Payments. All Service Payments shall not exceed [ * ] in the aggregate in any [ * ] month period (measured from the Ship Authorization date and each anniversary of the Ship Authorization date).

F. The parties agreed to [ * ] the FDR for each month does not exceed [ * ]%.

1. Motorola will notify Danger if the FDR for [ * ] or more consecutive months exceeds [ * ]% and will report a summary of its findings and [ * ].

2. A [ * ] SW Contribution to FDR level cannot exceed [ * ]% in any [ * ]. Should this level be exceeded and [ * ] or Motorola determines the product life will be terminated primarily due to such Monthly SW Contribution to FDR, Motorola will be entitled to reimbursement for all [ * ] with respect to the Product including but not limited to [ * ]. Motorola will reasonably [ * ]. Danger shall not be liable for such reimbursement if and to the extent that there is significant evidence that Client Software is not the cause of failures.

G. Root Cause Analysis.

1. If at any time the SW Contribution to FDR meets or exceeds[ * ], [ * ] may request [ * ] to send, at [ * ] expense, [ * ] failed units to [ * ] for analysis. [ * ] will reimburse [ * ], at [ * ] manufacturing cost (with batteries but without any other accessories), for any such units that are not returned repaired or in a repairable state to [ * ] within forty (40) days of [ * ] receipt. [ * ] shall also provide [ * ] with appropriate access to personnel and facilities, as reasonably requested by [ * ], and at [ * ] expense, so [ * ] analysis may be comprehensive. [ * ] will provide [ * ] its written analysis as soon as commercially reasonable.

2. In the event that [ * ] root cause analysis determines that Client Software was not the cause of returns, [ * ] will provide its evidence to [ * ]. Within [ * ] days of [ * ] providing such evidence [ * ] will review the data and reasonably determine if any adjustments to the Service Payments past or present, are appropriate. If [ * ] reasonably disagrees with [ * ] determination, the Parties shall [ * ]. If an adjustment is appropriate, the credit/debit will be processed within [ * ].

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H. Reporting.

1. [ * ] will report the following to [ * ] on a monthly basis, within [ * ] days after the end of each fiscal month:

a. [ * ] report (including [ * ] numbers), and [ * ] for each repaired unit) for quality improvement purposes; and

b. Total number of [ * ] for the month, including [ * ]), and [ * ] for each [ * ]. For each [ * ] shall also include, to the extent available, [ * ] information from the Approved Carrier and customer complaint information/codes.

2. [ * ] will report to [ * ] updates on Product defects and problem resolution plans when the FDR exceed the rates specified in Section F(2) above. [ * ] will report to [ * ] updates on Product defects and problem resolution plans the [ * ] exceed the rates specified in Section F(2) above.

I. Warranty Contacts. The following persons are identified as the primary interfaces between the two companies for warranty related issues and sustaining engineering activities:

Danger: [ * ], Director of Sustaining Engineering and Product Reliability, [ * ]

Motorola: [ * ], Global Business Operations Manager [ * ]

During the first [ * ] following commercial shipment of the Product, these contacts shall confer weekly to validate Repair Code classifications and ensure the integrity of data collection and reporting of warranty issues, this shall include participation in [ * ] process of having the first [ * ]. Such [ * ] would not be included in [ * ] for purpose of calculating [ * ]. Thereafter, these personnel should meet on an as needed basis (but to the extent that there are issues, no less frequently than [ * ] per [ * ]) to review quality and repair issues related to Client Software incorporated in the Products. As requested, [ * ] shall make arrangements for [ * ] to [ * ] to [ * ] and [ * ].

X. Training. [ * ] will provide the following training to [ * ] (in English):

A. [ * ], [ * ] shall provide one trainer for up to [ * ] of [ * ] training at [ * ] technical center during the [ * ] of this SOW.

B. Such training will address the topics necessary to ensure that [ * ] can adequately provide complete support for the product, including, without limitation, general [ * ] and [ * ]; training on the [ * ]; training on the [ * ] training.

C. Motorola and Danger will mutually agree on terms in the event additional ongoing training is necessary.

D. The parties will cooperate in scheduling all required training sessions hereunder.

E. No more than [ * ] personnel shall be in each training group, and no more than [ * ] training [ * ] shall be in each training session. [ * ] will be responsible for providing Products for its employees participating in training.

F. [ * ] shall provide a copy of its training manual (in English) in electronic format to [ * ] during the term of the Agreement. To the extent that [ * ] updates the training manuals, it shall provide one copy (in English) of all such updates in electronic format to [ * ]

XI. Maintenance & Support. Danger will provide support for the Deliverables pursuant to Exhibit B.

XII. Miscellaneous. This SOW, when executed by the Parties, shall be binding on the Parties, shall constitute part of the Agreement, and shall be subject to the terms and conditions thereof. All capitalized terms used herein and not otherwise defined in this SOW shall have the meanings ascribed to them in the Agreement. In the event of any inconsistencies between the terms of this SOW and the terms of the Agreement, the terms of the SOW shall be controlling.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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ACCEPTED AND AGREED:

MOTOROLA, INC.		DANGER
By:	/s/ Steve Lala	By:	/s/ Henry R. Nothhaft
Name:	Steve Lala	Name:	Henry R. Nothhaft
Title:	Corp. VP – 3GSM	Title:	Chairman & CEO
Date:	9/14/2006	Date:	9/20/2006

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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SCHEDULE 1

DOCUMENTATION OF ROLES AND RESPONSIBILITIES

[ * ]

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[ * ] SOW CHANGE ORDER REQUEST

Software License and Distribution Agreement

Statement of Work

dated as of

Unless otherwise indicated, all defined terms will have the same meaning as in the agreement noted above between Motorola, Inc. and                      (who for purposes of this document is called “Danger”).

SOW No. or Subject:

SOW Date:

Motorola requests the following Changes to the SOW:

Description of Change Start Date Completion Date Price Adjustment, if any

MOTOROLA, INC.

By:

Name:

Title:

Date:

(“Change Request Date”)

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[ * ] SOW CHANGE ORDER ACCEPTANCE

Software License and Distribution Agreement

Statement of Work

SOW No. or Subject:

SOW Date:

Change Request Date:

Danger accepts the Change above, or if applicable, modifies it as follows:

Describe any Modification of the Change (if applicable):

Danger must submit any proposed adjustments in writing to Motorola within 30 calendar days of the Change Order Request. If Danger does not submit a proposed adjustment to Motorola within the 30 days, or if Danger begins to implement the Change before both parties have signed the Agreement to Amend SOW at the end of this document, then the Change will be considered accepted as requested by Motorola.

DANGER

By:

Name:

Title:

Date:

(“Change Acceptance Date”)

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[ * ] AGREEMENT TO AMEND SOW

Software License and Distribution Agreement

Statement of Work

SOW No. or Subject:

SOW Date:

Change Request Date:

Change Acceptance Date:

This SOW is considered amended in the manner described above.

ACCEPTED AND AGREED:

MOTOROLA, INC.	DANGER
By:	By:
Name:	Name:
Title:	Title:
Date:	Date:

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EXHIBIT B

SUPPORT SERVICES

Licensor agrees to provide the following support and maintenance services to Motorola for the Client Software (“Support Services”) during the Support Period. The “Support Period” for each Client Software release shall begin on the date [ * ] and shall end [ * ]

1. Licensor shall provide remote technical assistance and consultation to Motorola as follows:

For all issues during the hours from [ * ], Motorola may contact the Product Program Manager via telephone and email. The Product Program Manager and contact information are identified in the Statement of Work for each Product.

If the Product Program Manager is not available during the hours outlined above, Motorola may contact Danger’s [ * ] group at [ * ].

2. Following notification by Motorola to Licensor of the existence of a defect, malfunction or error in the Client Software, Licensor shall (i) respond to Motorola’s support request and (ii) use best efforts to resolve the support issue, in accordance with the following schedule:

Schedule of Response/Resolution Times
Technical Severity Level	Response Time	Target Resolution Times
Severity 1:	[ * ] hours	[ * ] hour
Severity 2:	[ * ] hours	[ * ] hours
Severity 3:	[ * ] hours	[ * ] calendar days
Severity 4 & 5:	[ * ] hours	[ * ] calendar days

For the purposes of the Schedule of Response/Resolution Times set forth above, the following definitions shall apply:

Severity Level: The level of severity that [ * ] assigns to a given malfunction, defect or nonconformity of the Software.

Severity Level 1 (Critical) - means a problem that renders the product unfit for use and/or unable to be serviced. Problems of this severity usually result in the replacement or repair of all products containing the defective item.

Severity Level 2 (Serious) - means a problem that produces intermittent loss of function or degraded performance. Problems of this severity usually result in the discontinuance of production and distribution of the product until the problem is corrected.

Severity Level 3 (Moderate) - means a problem that impedes, but does not prevent the user from accomplishing the desired function. The customer will likely ignore the problem or find a “work around.” Some customers may register a complaint

Severity Level 4 (Minor) - means a minor problem that does not impede a customer from accomplishing any desired function. The customer may or may not notice the problem, and is unlikely to register a complaint. The customer’s perception of the quality may be damaged if several such problems are evident.

Severity Level 5 (Transparent) - means a problem that is invisible to the customer. The problem may be outside the executable software, e.g., development documentation. (Product documentation problems are at least Severity 4).

Response: The acknowledgement that a problem has been reported and Licensor’s technical assessment of the problem and suggestion for a course of action for resolution based on the information provided by Motorola.

Response Time: The maximum time period (within specified support hours defined in Section of this exhibit) permitted for Licensor to provide a Response to Motorola, with such period commencing on receipt of Motorola’s telephonic notification of such problem.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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Target Resolution Time: The time targeted by Licensor to resolve the problem, with such time period commencing upon the completion of the technical Response Time.

3. If Licensor cannot correct the Client Software within [ * ] from the time of notification by Motorola, Licensor will at Motorola’s request place at least [ * ] to provide emergency remedial maintenance services for [ * ] issues. If Motorola and Licensor jointly determine that the Client Software did not cause the problem, Motorola will [ * ] for the [ * ] at [ * ] for [ * ]. When making a request for [ * ] to be placed at [ * ] agrees to consider Licensor’s determination of whether the [ * ] can be more effective in resolving the problem at [ * ].

4. If any malfunction, defect or nonconformity reported to Licensor by Motorola pursuant to this Section is the result of [ * ] of the Software or is unrelated to the Software, [ * ] shall [ * ] to correct such malfunction, defect or nonconformity at [ * ] for such services.

5. Licensor shall [ * ] while performing the Support Services and Licensor will [ * ] Licensor’s employees performing Support Services on site at Motorola facilities.

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT C

LICENSOR SUPPLEMENT

FORM FOR

MASTER TECHNOLOGY ESCROW DEPOSIT AGREEMENT

Licensee Supplement Number                            

Licensor, Motorola Inc. and its Affiliates, (“Licensee”) and Iron Mountain Intellectual Property Management, Inc. (f/k/a) DSI Technology Escrow Services, Inc., “DSI” and hereafter, “Iron Mountain”), hereby acknowledge that Danger, Inc. is the “Licensor” referred to in the Master Technology Escrow Deposit Agreement (“Agreement”) effective October 1, 2003, amended by Addendum #1, dated January 1, 2005, with Iron Mountain as the escrow agent and Motorola, Inc. as the Licensee. The term “Agreement” includes the amendments and addenda thereto. In addition to Iron Mountain and Licensee by its signature below, Licensor by its signature hereby agrees to be bound by all provisions of such Agreement.

Deposit Account Number (to be assigned by Iron Mountain):                                     

The following terms shall apply to Licensor’s Deposit Materials and the management of the Deposit Account governed by this Licensor Supplement (the “Supplement”). In the event of any conflict between this Supplement and the Agreement, this Supplement shall govern.

1. Affiliates. The Deposit Materials will not be released to any Motorola’s affiliates, unless Motorola owns at least 50% of the outstanding capital or voting stock of such affiliate.

2. Deposit Materials. Section 5 of the Agreement is modified to account for the following: the Deposit Materials include (i) Licensor’s proprietary software that is part of the Client Software (as defined in Contract) and (ii) Third Party Software (as defined in the Contract) that is part of the Client Software, but only to the extent that Licensor has the contractual right to place such Third Party Software in to the Escrow Account. Licensee acknowledges that it may have to acquire rights directly from the licensors of Third Party Software in order to make full use of Client Software.

3. Term. Licensor shall have no obligation to make updates to the Deposit Materials that pertain to a Product (as defined in the Contract) 24 months after the last shipment of a Product to a wireless carrier customer.

4. Verification Rights. Use of Licensor’s facilities for verification purposes shall only be permitted during normal business hours and only upon at least five (5) business days’ advance written notice to Licensor. Licensee shall only be entitled to observe the compilation or verification of the Deposit Materials if agreed by Licensor in writing following the verification request.

5. Release Conditions. Section 12(a) –(h) of the Agreement is replaced in its entirety will with following:

a. Licensor materially breaches [ * ] imposed on it pursuant to the Contract or other agreement between Licensor and Licensee specifically referencing this Agreement (collectively, “[ * ]”) and, within [ * ] business days after receipt of written notice of such breach from Licensee, Licensor has not cured such breach or provided Licensee with assurances (reasonably acceptable to Licensee) that the breach will be cured promptly. For the purposes of this Section 12(a), Licensor’s failure to provide its [ * ] at a [ * ] generally accepted for the industry shall be deemed a material breach of its [ * ] obligations under the Contract. ; or

b. Licensor makes an [ * ] (as defined below) of the [ * ] to a [ * ] (as defined in the Contract) and Licensor does not [ * ] in the [ * ] to perform its [ * ] obligations to Licensee. [ * ] shall mean Licensor’s [ * ] that is not part of a [ * ]. [ * ] to an [ * ] Licensor shall not constitute an [ * ]; or

c. Licensor’s uncured, material breach of its [ * ] under an SOW (as defined in the Contract) for which, following written notice from Licensee, Licensor [ * ] that Licensor [ * ]; or

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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d. The [ * ] as indicated by the occurrence of any one of the following events; (i) [ * ]

6. Damages Waiver. Notwithstanding the damages waivers in the Agreement, the parties to this Supplement shall be liable for consequential damages for any material breach of their respective confidentiality obligations under the Agreement.

Conditions for Use Following Release. The phrase “continuing the benefits afforded to Licensee by the Contract” in Section 13 of the Agreement shall be limited to use of the Client Software to support the manufacture, development, distribution, marketing and repair of Products [ * ].

Effective Date of Licensor Supplement (to be assigned by Iron Mountain):                                     

Licensor, Licensee, and Iron Mountain each acknowledges that it has read the Agreement, its Exhibits, and Licensor Supplement and Exhibits, understands each, and agrees to be bound by its terms.

Licensor	Licensee (as applicable, fill with Motorola, Inc., and its Affiliates)
By:	By:
Name:	Name:
Title:	Title:
Date:	Date:
Iron Mountain Intellectual Property Management
By:
Name:
Title:
Date:

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LICENSOR SUPPLEMENT

FORM FOR

MASTER TECHNOLOGY ESCROW DEPOSIT AGREEMENT

(Continued)

MATERIALS TO BE DEPOSITED BY LICENSOR:

Licensor represents to Licensee that Deposit Materials delivered to Iron Mountain shall consist of the following:

Licensed Program or Software:

Version & Release Numbers:

License type:

Quantity:

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT “A” TO

LICENSOR SUPPLEMENT FOR

MASTER TECHNOLOGY ESCROW DEPOSIT AGREEMENT

Deposit Account Number:                                     

DESIGNATED REPRESENTATIVES AND LOCATIONS

Notices to Licensor regarding Agreement Terms and Conditions should be addressed to the following representatives:

Licensor:

Address:

Designated

Representative:

Phone:

And Licensor’s Alternate Designated Representative

Licensor:

Address:

Designated

Representative:

Phone:

Notices to Licensee (Motorola, Inc., or its Affiliate) regarding Agreement Terms and Conditions should be addressed to the following representatives:

Licensee:

Address:

Designated

Representative:

Phone:

And Licensee’s Alternate Designated Representative “Business Owner”

Licensee:

Address:

Designated

Representative:

Phone:

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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EXHIBIT “A” TO

LICENSOR SUPPLEMENT FOR

MASTER TECHNOLOGY ESCROW DEPOSIT AGREEMENT

(Continued)

Invoices for Licensor should be addressed to:

Company Name:
Address:
Designated	Contact:
Telephone:
Facsimile:
E-mail:
Verification	Contact:

P. O. number, if required                                                                      

    Or

Invoices for Licensee should be addressed to:

Company Name:
Address:
Designated	Contact:
Telephone:
Facsimile:
E-mail:
Verification	Contact:

P. O. number, if required                                                                      

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EXHIBIT “A” TO

LICENSOR SUPPLEMENT FOR

MASTER TECHNOLOGY ESCROW DEPOSIT AGREEMENT

(Continued)

Notices to Iron Mountain

All notices and requests from Licensee or Licensor to Iron Mountain, including change of the Designated or Alternate Representative, must be given in writing and signed by an officer of Licensee or Licensor as the case may be.

All Contracts, Deposit Materials and Official Notifications to Iron Mountain should be addressed to:

Iron Mountain Intellectual Property Management, Inc.

ATTN: Contract Administration

2100 Norcross Parkway

Suite 150

Norcross, GA 30071

(Ph) 770-239-9200

(Fax) 770-239-9201

Date:                     

Invoice Inquiries and Remittance of Invoiced Fees to Iron Mountain should be addressed to:

Iron Mountain Intellectual Property Management, Inc.

Accounts Receivable

PO Box 27131

New York, NY 10087-7131

Software License & Distribution Agreement Page 33 of 35 Version 17 May 2006

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

M O T O R O L A / D A N G E R    C O N F I D E N T I A L    P  R O P R I E T A R Y

EXHIBIT “B” TO

MASTER TECHNOLOGY ESCROW DEPOSIT AGREEMENT

DESCRIPTION OF DEPOSIT MATERIALS

Licensor Company Name

Deposit Account Number

Product Name

(Product Name will appear as Exhibit B Name on Account History report)

Version

DEPOSIT MATERIAL DESCRIPTION:

Quantity Media Type & Size	Label Description of Each Separate Item
	(Please use other side if additional space is needed)

        Disk 3.5” or         

        DAT tape         mm

        CD-ROM

        Data cartridge tape         

        TK 70 or          tape

        Magnetic tape         

        Documentation

        Other                             

PRODUCT DESCRIPTION:

Environment (include Operating System & Hardware Platform requirements)

DEPOSIT MATERIAL INFORMATION:

Is the media or are any of the files encrypted? Yes / No If yes, please include any passwords and the decryption tools.

Encryption tool name	Version
Hardware required
Software required
Other required information

I certify for Licensor that the above described Deposit Materials have been transmitted to Iron Mountain:		Iron Mountain has visually inspected and accepted the above materials (any exceptions are noted above):
Signature	Signature
Print Name		Print Name
Date		Date Accepted
E-mail	Exhibit B#

Software License & Distribution Agreement Page 34 of 35 Version 17 May 2006

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

M O T O R O L A / D A N G E R    C O N F I D E N T I A L    P  R O P R I E T A R Y

EXHIBIT D: Claims and Litigation Disclosure

[ * ]

Software License & Distribution Agreement Page 35 of 35 Version 17 May 2006

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

EX-10.23

Exhibit 10.23

LEASE

BETWEEN

PARK PLACE ASSOCIATES, LANDLORD

AND

DANGER, INC., TENANT

3101 Park Boulevard

Palo Alto, California 94306

March 14, 2006

TABLE OF CONTENTS

		Page
1.	Lease	1
2.	Initial Term	1
3.	Option to Extend	2
4.	Monthly Base Rent	4
5.	Additional Rent; Operating Expenses and Taxes	4
6.	Payment of Rent	8
7.	Security Deposit	9
8.	Use	10
9.	Environmental Matters	10
10.	Taxes on Tenant’s Property	11
11.	Insurance	12
12.	Indemnification	13
13.	Landlord’s Improvement Work; Condition of the Building	14
14.	Maintenance and Repairs; Alterations; Surrender and Restoration	15
15.	Utilities and Services	17
16.	Liens	18
17.	Assignment and Subletting	18
18.	Non-Waiver	21
19.	Holding Over	21
20.	Damage or Destruction	22
21.	Eminent Domain	24
22.	Remedies	25
23.	Tenant’s Personal Property	26
24.	Notices	26
25.	Estoppel Certificates	27
26.	Parking	27
27.	Signage	27
28.	Tenant’s Broker	27
29.	Subordination; Attornment	28
30.	Breach by Landlord	28
31.	Landlord’s Entry	28
32.	Attorneys’ Fees	29
33.	Quiet Possession	29
34.	General Provisions	29

SCHEDULE OF EXHIBITS

EXHIBIT A        Commencement Memorandum

EXHIBIT B        Tenant’s Hazardous Materials

EXHIBIT C        Alterations by Pacific Data Images, Inc. (to be removed)

LEASE

3101 Park Boulevard

Palo Alto, California 94306

THIS LEASE, referred to herein as “this Lease,” dated for reference purposes as of March 14, 2006, is made and entered Into by and between PARK PLACE ASSOCIATES, a California general partnership (“Landlord”), and DANGER, INC., a Delaware corporation (“Tenant”).

RECITALS:

A. Landlord is the owner of that certain real property together with the improvements thereon consisting of a three (3) story building (the “Building”) containing approximately 40,000 rentable square feet, situated upon approximately 1.58 acres of land (the “Land”), commonly known as 3101 Park Boulevard, Palo Alto, California 94306, and also described as Santa Clara County Assessor’s Parcel Number 132-26-071-00 (the Building, the Land, and the other improvements thereon are referred to herein collectively as the “Premises”).

B. Landlord and Tenant wish to enter into this Lease of the Premises upon the terms and conditions set forth herein.

NOW, THEREFORE, the parties agree as follows:

1. LEASE

Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord the Premises at the rental and upon all of the terms and conditions set forth herein.

2. INITIAL TERM

(a) Subject to the execution and delivery of this Lease by Landlord and Tenant, the term of this Lease (the “initial term”) shall commence on January 1, 2007 (the “Commencement Date”), and shall expire on December 31, 2009 (the “Expiration Date”), unless sooner terminated or extended in accordance with the provisions hereof. Upon the execution and delivery of this Lease, Landlord and Tenant shall confirm in writing the Commencement Date and the Expiration Date of the initial term by executing and delivering the Commencement Memorandum in the form attached hereto as Exhibit A and incorporated by reference herein. The “term of this Lease” as used herein shall include the option extension period referred to in Paragraph 3 if the option to extend is exercised in a timely manner.

(b) Tenant acknowledges that (1) Tenant is currently in possession of the Premises pursuant to that certain Sublease dated as of July 8, 2003 (the “Sublease”), by and between Pacific Data Images, Inc., a California corporation (“Pacific Data”), as Sublandlord, and Tenant, as Subtenant, and (2) the Sublease is in full force and effect and there is no existing uncured default thereunder by either Sublandlord (to Tenant’s knowledge) or Tenant Landlord

acknowledges that (1) Tenant is currently in possession of the Premises pursuant to the Sublease, (2) Pacific Data leases the Premises pursuant to that certain Lease dated as of November 14, 1995 by and between Landlord, as landlord, and Pacific Data Images, Inc., as tenant (the “Master Lease”), and (3) the Master Lease is in full force and effect and there is no existing uncured default thereunder by either Landlord or (to Landlord’s knowledge) Pacific Data.

3. OPTION TO EXTEND

(a) Landlord hereby grants to Tenant one (1) option to extend the term of this Lease for a period of twenty-four (24) calendar months immediately following the expiration of the initial term. Tenant may exercise the foregoing option to extend by giving written notice of exercise to Landlord at least six (6) months, but not more than nine (9) months, prior to the expiration of the initial term of this Lease (“the option exercise period”), time being of the essence; provided that if Tenant is currently in a state of uncured default after the expiration of notice and cure periods, if applicable (referred to herein as “in default”) under this Lease at the time of exercise of the option or on the commencement date of the option extension period, such notice of exercise shall be void and of no force or effect. Such option extension period, if exercised, shall be upon the same terms and conditions as the initial term of this Lease, including the payment by Tenant of the Operating Expenses and Taxes pursuant to Paragraph 5, except that (1) the Monthly Base Rent during the option period shall be determined as set forth in Paragraph 3(b) hereof, (2) there shall be no additional option to extend, and (3) Tenant shall accept the Premises in their then “as is” condition, and Paragraph 13(a) and Paragraph 13(b) of this Lease shall not apply to the option period. If Tenant does not exercise the option to extend in a timely manner the option shall lapse, time being of the essence.

(b) The initial Monthly Base Rent for the Premises during the option extension period shall be the greater of (1) Eighty-two Thousand Dollars ($82,000) per month, or (2) the then current fair market Monthly Base Rent for the Premises on the commencement date of the option extension period as determined by agreement between the Landlord and Tenant reached prior to the expiration of the option exercise period, if possible, and by the process of appraisal if the parties cannot reach agreement.

Upon the written request by Tenant to Landlord received by Landlord no earlier than ninety (90) days and no later than thirty (30) days prior to the expiration of the option exercise period (e.g., between April 1, 2009 and May 31, 2009) and prior to the exercise by Tenant of the option to extend, Landlord shall give Tenant written notice of Landlord’s good faith opinion of the fair market Monthly Base Rent for the Premises as of the commencement date of the option extension period. If Landlord’s good faith opinion of the fair market Monthly Base Rent for the Premises as of the commencement date of the option extension period exceeds Eighty-two Thousand Dollars ($82,000) per month, then upon the request of Tenant, Landlord and Tenant shall enter into good faith negotiations for thirty (30) days in an effort to reach agreement on the initial Monthly Base Rent for the Premises during the option extension period.

If Landlord and Tenant are unable to agree upon the amount equal to the then current fair market Monthly Base Rent for the Premises, and thereafter, prior to the expiration of the option exercise period, Tenant exercises the option to extend, said amount shall be determined by appraisal. The appraisal shall be performed by one appraiser if the parties are

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able to agree upon one appraiser. If the parties are unable to agree upon one appraiser, each party shall appoint an appraiser and the two appraisers shall select a third appraiser. Each appraiser selected shall be an experienced commercial real estate agent with at least five (5) years of full-time commercial real estate experience in the Palo Alto office market.

If only one appraiser is selected, that appraiser shall notify the parties in simple letter form of its determination of the amount equal to the fair market Monthly Base Rent for the Premises on the commencement date of the option extension period within fifteen (15) days following its selection. Said appraisal shall be binding on the parties as the appraised current “fair market Monthly Base Rent” for the Premises which shall be based upon what a willing new lessee would pay and a willing lessor would accept at arm’s length for the Premises determined with reference to comparable premises in the market area of the Premises of similar age, size, quality of construction and specifications (excluding the value of any improvements to the Premises made at Tenant’s cost) for a lease similar to this Lease and taking into consideration that there will be no free rent, improvement allowance, or other concessions. If multiple appraisers are selected, each appraiser shall within ten (10) days of being selected make its determination of the amount of the current fair market Monthly Base Rent for the Premises in simple letter form. If two (2) or more of the appraisers agree on said amount, such agreement shall be binding upon the parties. If multiple appraisers are selected and two (2) appraisers are unable to agree on said amount, the amount of the fair market Monthly Base Rent for the Premises shall be determined by taking the mean average of the appraisals; provided, that any high or low appraisal, differing from the middle appraisal by more than ten percent (10%) of the middle appraisal, shall be disregarded in calculating the average. Said initial Monthly Base Rent shall be increased on the first anniversary of the commencement of the option term in the manner determined by the appraisers to be consistent with the then prevailing market practice for comparable space in the Palo Alto office market, subject to Paragraph 3(d) hereof.

If only one appraiser is selected, then each party shall pay one-half of the fees and expenses of that appraiser. If three appraisers are selected, each party shall bear the fees and expenses of the appraiser it selects and one-half of the fees and expenses of the third appraiser.

(c) Thereafter, provided that Tenant has previously given timely notice to Landlord of the exercise by Tenant of the option to extend the term, Landlord and Tenant shall execute an amendment to this Lease stating that the initial Monthly Base Rent for the Premises during the option extension period (and the increase as of the first anniversary of the commencement of the option extension period) shall be equal to the determination by appraisal.

(d) Notwithstanding anything to the contrary contained in subparagraphs (b) and (c) above, in no event shall the Monthly Base Rent at the commencement of the option extension period be less than Eighty-two Thousand Dollars ($82,000) per month, and in no event shall the increase in Monthly Base Rent as of the first anniversary of the commencement of the option term be less than $0.10 per rentable square foot of the Premises.

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4. MONTHLY BASE RENT.

(a) Commencing on the Commencement Date and continuing on the first day of each calendar month thereafter during the term, Tenant shall pay to Landlord in monthly installments in advance Monthly Base Rent, in lawful money of the United States, as follows:

Period	Rent/sf/Month/NNN		Amount
January 1, 2007 – December 31, 2007	$	1.75	$	70,000
January 1, 2008 – December 31, 2008	$	1.85	$	74,000
January 1, 2009 – December 31, 2009	$	1.95	$	78,000

(b) Upon the execution and delivery of this Lease by Landlord and Tenant, Tenant shall pay to Landlord the sum of Seventy Thousand Dollars ($70,000) representing the Monthly Base Rent for the month of January 2007. Subject to completion of Landlord’s Work pursuant to Paragraph 12 of this Lease, commencing on February 1, 2007, Monthly Base Rent shall be payable in monthly installments in advance on the first day of each calendar month. Monthly Base Rent for the partial month at the expiration of the initial term or earlier termination of this Lease shall be prorated on the basis of the number of days in the calendar month in which the initial term expires or is earlier terminated. Upon the execution and delivery of this Lease by Landlord and Tenant, Tenant shall also pay to Landlord the security deposit of One Hundred Thousand Dollars ($100,000) pursuant to Paragraph 7 hereof.

5. ADDITIONAL RENT; OPERATING EXPENSES AND TAXES

(a) In addition to the Monthly Base Rent payable by Tenant pursuant to Paragraph 4, Tenant shall pay to Landlord during the term of this Lease as “Additional Rent” all Operating Expenses of the Premises as defined in Paragraph 5(b) and all Taxes levied or assessed against the Premises as Taxes are defined in Paragraph 5(c) hereof.

(b) “Operating Expenses” as used herein shall include all direct costs actually incurred by Landlord in the management, operation, maintenance, repair, and replacement of the Premises, including the cost of all maintenance, repairs, and restoration of the Premises performed by Landlord pursuant to Paragraphs 14(b) and 14(c) hereof, as determined in accordance with generally accepted accounting principles (unless excluded by this Lease), including, but not limited to:

Personal property taxes related to the Premises; any parking taxes or levies imposed on the Premises after the Commencement Date by any governmental agency; a management fee equal to three percent (3%) of Monthly Base Rent payable by Tenant under this Lease, which management fee shall be payable to Landlord, any affiliate of Landlord, or an independent property manager selected by Landlord; water and sewer charges; waste disposal; insurance premiums for insurance coverages maintained by Landlord pursuant to Paragraph 11(b) hereof; license, permit, and inspection fees; all charges for electricity, heating, air conditioning, gas, and any other utilities (including, without limitation, any temporary or permanent utility surcharge or other exaction) except to the extent that such utilities are paid directly by Tenant pursuant to Paragraph 15(a); maintenance, repair, and replacement of the roof

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membrane (following the work to be performed by Landlord pursuant to Paragraph 13(b)(1)); maintenance and replacement of floor and window coverings; repair, maintenance, and replacement of the heating, ventilating, air conditioning, mechanical and electrical systems, plumbing and sewage systems (after completion of Landlord’s work referred to in Paragraphs 13(a) and 13(b)); landscaping, gardening, and tree trimming; glazing; repair, maintenance, cleaning, sweeping, striping, and resurfacing of the parking area; exterior Building lighting and parking lot lighting; supplies, materials, equipment and tools used in the maintenance of the Premises; costs for accounting services incurred in the calculation of Operating Expenses and Taxes as defined herein; and the cost of capital expenditures for any improvements or changes to the Building or improvements which are required by laws, ordinances, or other governmental regulations adopted after the Commencement Date, or for any capital expenditures voluntarily made by Landlord which have the effect of reducing Operating Expenses, and the cost of all such capital expenditures and improvements (including those required by laws, ordinances, etc) shall be amortized over the useful life of said improvements (together with interest on the unamortized balance at the rate equal to the effective rate of interest actually charged to Landlord (or if Landlord has not borrowed such funds, at the rate of interest that Landlord’s bank would have charged Landlord on a line of credit at the time of completion of the improvements), but in no event in excess of twelve percent (12%) per annum) as an Operating Expense in accordance with generally accepted accounting principles; provided, however, that with respect to capital improvements made to save Operating Expenses, the amortization thereof shall not be at a rate greater than the actual savings in Operating Expenses. Operating Expenses shall also include any other expense or charge, whether or not described herein, not specifically excluded by other provisions of this Lease, which in accordance with generally accepted accounting principles would be considered an expense of managing, operating, maintaining, repairing, and managing the Premises.

In addition to the Operating Expenses referred to above, Tenant shall pay to Landlord an amount equal to twenty percent (20%) of the cost of the new HVAC equipment serving the Building to be installed by Landlord as part of Landlord’s Work pursuant to Paragraph 13(a) hereof Said amount shall be paid by Tenant to Landlord in thirty-six (36) equal monthly installments as part of the Operating Expenses payable by Tenant pursuant to this Paragraph 5(b).

(c) Real property taxes and assessments levied or assessed against the Premises, during the term of this Lease are referred to herein as “Taxes”.

As used herein, “Taxes” shall mean:

(1) all real estate taxes, assessments and any other taxes levied or assessed against the Premises including the Land, the Building, and all improvements located thereon, including any increase in Taxes resulting from a reassessment following any transfer of ownership of the Premises or any interest therein or following any improvements to the Premises; and

(2) all other taxes which may be levied in lieu of real estate taxes, assessments, and other fees, charges, and levies, general and special, ordinary and extraordinary, unforeseen as well as foreseen, of any kind and nature by any authority having the direct or

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indirect power to tax, including without limitation any governmental authority or any improvement or other district or division thereof, for public improvements, services, or benefits which are assessed, levied, confirmed, imposed, or become a lien (A) upon the Premises, and/or any legal or equitable interest of Landlord in any part thereof; or (B) upon this transaction or any document to which Tenant is a party creating or transferring any interest in the Premises; and (C) any tax or excise, however described, imposed in addition to, or in substitution partially or totally of any tax previously included within the definition of “Taxes” or any tax the nature of which was previously included in the definition “Taxes”.

Not included within the definition of “Taxes” are: (a) any net income, profits, transfer, franchise, estate, gift, rental income, or inheritance taxes imposed by any governmental authority, and (b) penalties or interest charges assessed on delinquent Taxes so long as Tenant is not in default in the payment of Monthly Base Rent or Additional Rent Tenant’s obligation to pay any assessments included within Taxes shall be calculated on the basis of the amount due if Landlord had allowed the assessment to go to bond and the same were to be paid over the longest period available.

Tenant shall be required to pay any tax based on (1) gross or net rents, (2) the square footage of the Premises or the Building, (3) this transaction (or any document relating thereto), (4) the occupancy of Tenant, or (5) any other tax, fee, or excise, however described, including, without limitation, a so called “value added tax,” as a direct substitution in whole or in part for, or in addition to, any real property tax, only to the extent that any such tax is in substitution of any real property tax it would otherwise be obligated to pay. With respect to any assessments which may be levied against or upon the Premises, or the Land, which under the laws then in force may be evidenced by improvement or other bonds, or may be paid in annual installments, only the amount of such annual installment (with appropriate proration of any partial year) and statutory interest shall be included within the computation of the annual Taxes levied against the Premises.

(d) Notwithstanding the foregoing, the following costs (“Costs”) shall be excluded from the definition of Operating Expenses:

(1) Costs for which Landlord receives reimbursement from others, including reimbursement from insurance;

(2) Interest, charges and fees incurred on debt or payments on any deed of trust or ground lease on the Premises of which Landlord is debtor, trustor, or lessee;

(3) Costs incurred in repairing, maintaining or replacing any structural elements of the Building for which Landlord is responsible pursuant to Paragraph 14(a) hereof;

(4) Any wages, bonuses or other compensation of employees of Landlord, including fringe benefits, or any fee, office overhead or general and administrative expenses paid to Landlord or its affiliates for management and administration of the Premises in excess of the management fee referred to in Paragraph 5(b) of this Lease;

(5) Expense reserves;

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(6) Costs in the nature of depreciation, amortization or other accounting charges of Landlord;

(7) Costs incurred as a result of casualties or by the exercise of the power of eminent domain;

(8) Earthquake insurance deductibles, except to the extent used for repair or reconstruction and the costs amortized over the useful life of the repaired or reconstructed improvements so damaged;

(9) Costs of a capital nature, including but not limited to capital improvements and alterations, capital repairs, capital equipment, and capital tools as determined in accordance with generally accepted accounting principles, excepting only capital expenditures for improvements or changes to the Building, which are required by laws, ordinances, or other governmental regulations adopted after the Commencement Date, and capital expenditures which have the effect of reducing Operating Expenses, to the extent the cost of all such capital improvements are amortized over the useful life of said improvements, pursuant to Paragraph 5(b);

(10) real estate brokerage and leasing commissions, attorneys’ fees, costs, disbursements, and other expenses incurred in connection leasing, renovating, or improving space for prospective tenants or other occupants of the Premises;

(11) advertising and marketing expenses;

(12) costs with respect to the creation of a mortgage or a superior lease or in connection with a sale of the Premises;

(13) Landlord’s or Landlord’s property manager’s corporate general overhead or corporate general administrative expenses;

(14) overhead profit increments paid to Landlord’s subsidiaries or affiliates for management or other services on or to the building or for supplies or other materials to the extent that the cost of the services, supplies, or materials exceeds the cost that would have been paid had the services, supplies, or materials been provided by unaffiliated parties on a competitive basis;

(15) any compensation paid to clerks, attendants, or other persons in commercial concessions operated by Landlord;

(16) any costs, fines, or penalties incurred due late payment, negligence or willful misconduct on the part of Landlord, its agents, employees or contractors, or due to violations by Landlord of any governmental rule or authority, including without limitation, the cost of correcting any building code or other violations which were violations prior to the Commencement Date, this Lease;

(17) the cost of containing, removing, or otherwise remediating any contamination of the Building (including the underlying land and ground water) by any toxic or

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hazardous materials (including, without limitation, asbestos and “PCB’s”) where such contamination was not caused by Tenant;

(18) wages, salaries, or other compensation paid to any executive employees above the grade of building manager; and

(19) any other expense that under generally accepted accounting principles and practices consistently applied would not be considered a normal maintenance or operating expense.

(e) Landlord shall at all times use its best efforts to operate the Premises in an economically reasonable manner at costs not disproportionately higher than those experienced by other comparable premises in the market area in which the Premises are located.

(f) The first monthly installment of Operating Expenses and Taxes shall be payable on or before the Commencement Date of this Lease; thereafter Operating Expenses and Taxes shall be paid in monthly installments, concurrently with Monthly Base Rent, based upon Landlord’s good faith annual estimate of Operating Expenses and Taxes. Tenant’s initial payment is based upon Landlord’s estimate of Operating Expenses and Taxes for the year in question, and the monthly payments thereof (and future payments) are subject to increase or decrease as determined by Landlord to reflect an accurate estimate of actual Operating Expenses and Taxes. Within ninety (90) days after the end of each calendar year, Landlord shall deliver to Tenant a statement of actual Operating Expenses and Taxes for such calendar year. Within thirty (30) days after its receipt of such statement, Tenant shall pay Landlord the amount of any deficiency, or Landlord shall credit Tenant (or, if such adjustment is at the end of the Term, pay Tenant) the amount of any excess, in Tenant’s payment of its of Operating Expenses and Taxes over actual Operating Expenses and Taxes for such calendar year. Failure by Landlord to deliver to Tenant the annual statement of actual Operating Expenses and Taxes within the period specified above shall not relieve Tenant of the obligation to pay the amount of any such deficiency payable by Tenant.

(g) Tenant or its accountants shall have the right to inspect and audit Landlord’s books and records with respect to this Lease once each calendar year to verify actual Operating Expenses and/or Taxes Landlord’s books and records shall be kept in accord with generally accepted accounting principles. If Tenant’s audit of the Operating Expenses or Taxes for any year reveals an overcharge, the amount of the overcharge shall be credited against Operating Expenses and/or Taxes next due hereunder or paid directly to Tenant, if this Lease shall have terminated. If Tenant’s audit of the Operating Expenses or Taxes for any year reveals a net overcharge of more than five percent (5%), the amount of such net overcharge shall be paid directly to Tenant, and Landlord promptly shall reimburse Tenant for the cost of the audit; otherwise, Tenant shall bear the cost of Tenant’s audit Landlord’s and Tenant’s obligations under this subparagraph (g) shall survive the expiration or termination of this Lease.

6. PAYMENT OF RENT

(a) All rent shall be due and payable by Tenant in lawful money of the United States of America at the address of Landlord set forth in Paragraph 24, “Notices,” without

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deduction or offset and without prior demand or notice, unless otherwise specified herein Monthly Base Rent shall be payable monthly, in advance, on the first (1st) day of each calendar month during the term of this Lease (except that the Monthly Base Rent for the month of January 2007 shall be paid by Tenant upon the execution and delivery of this Lease by Landlord and Tenant pursuant to Paragraph 4(b) hereof). Tenant’s obligation to pay Operating Expenses and Taxes shall commence on the Commencement Date and shall continue thereafter as billed by Landlord, but in no event more frequently than once per month. The term “rent” as used in this Lease shall include all sums payable by Tenant hereunder.

(b) If any installment of Monthly Base Rent, Additional Rent or any other sum due from Tenant is not received by Landlord within five (5) days after the same is due, Tenant shall pay to Landlord an additional sum equal to five percent (5%) of the amount overdue as a late charge. The parties agree that this late charge represents a fair and reasonable estimate of the costs that Landlord will incur by reason of the late payment by Tenant. Acceptance of any late charge shall not constitute a waiver of Tenant’s default with respect to the overdue amount. Any amount not paid within five (5) days after Tenant’s receipt of written notice that such amount is due shall bear interest from the date due until paid at the lesser rate of (1) the prime rate of interest as published in the “Wall Street Journal,” plus five percent (5%) or (2) the maximum rate allowed by law (the “Interest Rate”), in addition to the late payment charge.

Initials: Landlord     HB                            Tenant     HN

7. SECURITY DEPOSIT

(a) Concurrently with the execution and delivery of this Lease by Landlord and Tenant, Tenant shall deposit with Landlord the sum of One Hundred Thousand Dollars ($100,000) (the “Security Deposit”), as security for Tenant’s faithful performance of Tenant’s obligations under this Lease. If Tenant fails to pay Monthly Base Rent, Additional Rent, or any other sums due hereunder within applicable notice and cure periods referred to in Paragraph 22, or otherwise defaults under this Lease (as defined in Paragraph 22, including applicable notice and cure periods referred to herein, if any), Landlord may use, apply or retain all or any portion of the Security Deposit for the payment of any amount due Landlord or to reimburse or compensate Landlord for any liability, cost, expense, loss or damage (including attorneys’ fees) which Landlord may suffer or incur by reason thereof. If Landlord uses or applies all or any portion of the Security Deposit, Tenant shall within ten (10) days after written request therefor deposit an amount with Landlord sufficient to restore the Security Deposit to the original amount required by this Lease. Landlord shall not be required to keep all or any part of the Security Deposit separate from its general accounts.

(b) Within thirty (30) days after the expiration or earlier termination of the term hereof and after Tenant has vacated the Premises Landlord shall return to Tenant (or at Landlord’s option, to the last assignee, if any, of Tenant’s interest herein), that portion of the Security Deposit not used or applied by Landlord. Unless otherwise expressly agreed in writing by Landlord, no part of the Security Deposit shall be considered to be held in trust, to bear interest or other increment for its use, or to be prepayment for any moneys to be paid by Tenant under this Lease.

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8. USE

Subject to Landlord’s prior approval, the Premises shall be used only for (i) general office purposes, (ii) engineering technology and software business services, (iii) assembly, testing and development of software, and (iv) any other legally permitted uses. The Premises shall not be used or permitted to be used for any other purpose without the prior written consent of Landlord, which consent shall not be unreasonably withheld, conditioned or delayed. Tenant agrees that Landlord shall not be deemed unreasonable in withholding its approval for any use that is prohibited by applicable zoning laws or governmental regulations.

9. ENVIRONMENTAL MATTERS

(a) The term “Hazardous Materials” as used in this Lease shall mean any product, substance, or waste whose presence, use, manufacture, disposal, transportation, or release, is regulated or monitored by any governmental authority pursuant to Environmental Laws. Hazardous Materials shall include, but not be limited to hydrocarbons, petroleum, gasoline, and/or crude oil or any products, by-products or fractions thereof.

(b) “Environmental Laws” shall mean and include any Federal, State, or local statute, law, ordinance, code, rule, regulation, order, or decree regulating, relating to, or imposing liability or standards of conduct concerning, any hazardous, toxic, or dangerous waste, substance, element, compound, mixture or material, as now or at any time hereafter in effect including, without limitation, California Health and Safety Code §§25100 et seq., §§25300 et seq., Sections 25281(f) and 25501 of the California Health and Safety Code, Section 13050 of the Water Code, the Federal Comprehensive Environmental Response, Compensation and Liability Act, as amended, 42 U.S.C. §§9601 et seq. (“CERCLA”), the Superfund Amendments and Reauthorization Act, 42 U.S.C. §§9601 et seq., the Federal Toxic Substances Control Act, 15 U.S.C. §§2601 et seq., the Federal Resource Conservation and Recovery Act as amended, 42 U.S.C. §§6901 et seq., the Federal Hazardous Material Transportation Act, 49 U.S.C. §§1801 et seq., the Federal Clean Air Act, 42 U.S.C. §7401 et seq., the Federal Water Pollution Control Act, 33 U.S.C. §1251 et seq., the River and Harbors Act of 1899, 33 U.S.C. §§401 et seq., and all rules and regulations of the EPA, the California Environmental Protection Agency, or any other state or federal department, board or any other agency or governmental board or entity generally having jurisdiction over the environment, as any of the foregoing have been, or are hereafter amended.

(c) Tenant shall not use, store, or transport to or from the Premises, or dispose of any Hazardous Materials without Landlord’s prior written consent, except (1) the Hazardous Materials listed on Exhibit B attached hereto and incorporated by reference herein, (2) ordinary and customary office supplies and cleaning materials which are used in the normal course of Tenant’s agreed use of the Premises, and (3) such other Hazardous Materials the generation, possession, storage, use, transportation, or disposal of which in the quantities used by Tenant do not require a permit from any governmental authority. All such Hazardous Materials (1) shall be used, stored, transported, and disposed of in strict compliance with Environmental Laws, and (2) shall be stored on the Premises only in limited quantity required for Tenant’s business at the Premises. Except as listed on Exhibit B, as Exhibit B may be amended and supplemented from

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time to time with Landlord’s prior written consent, and except as otherwise specifically permitted by this Paragraph 9(c), Tenant shall not use, store, transport, or dispose of any Hazardous Materials in or about the Premises. Without limiting the generality of the foregoing, Tenant shall, at its sole cost, comply with all Environmental Laws relating to its use of Hazardous Materials. If Hazardous Materials are discovered at or about the Premises in violation of Environmental Laws and such Hazardous Materials were used, stored, transported, or disposed of by Tenant, then Tenant shall, at Tenant’s sole expense, promptly take all action necessary to cause the Premises to comply with all Environmental Laws with respect to such Hazardous Materials. Tenant shall deliver to Landlord (1) a copy of Tenant’s current Hazardous Materials Management Plan (if any), and any amendments or supplements thereto, or replacements thereof, from time to time during the term of this Lease, and (2) a copy of all Hazardous Materials reports or plans filed by Tenant with the City of Palo Alto (the “City”).

(d) If Tenant knows, or has reasonable cause to believe, that Hazardous Materials have come to be located in, on, under or about the Premises, other than as shown on Exhibit B or previously approved in writing by Landlord, or shown on Tenant’s Hazardous Materials Management Plan, if any, Tenant shall immediately give written notice of such fact to Landlord and provide Landlord with a copy of any report, notice, claim or other documentation which Tenant has in its possession concerning the presence of such Hazardous Materials.

(e) Tenant shall indemnify, defend with counsel reasonably acceptable to Landlord, and hold Landlord harmless from any and all claims, damages, fines, judgments, penalties, costs, liabilities or losses (including, without limitation, any and all sums paid for settlement of claims, attorneys’ fees, consultant and expert fees) arising during or after the term (as such may be extended) from the use, storage, transportation, release, disposal, discharge, or emission of Hazardous Materials at or about the Premises by Tenant, or Tenant’s employees, agents, contractors, or invitees (“Tenant’s Parties”) in violation of Environmental Laws or the terms of this Lease. Without limitation of the foregoing, this indemnification shall include any and all costs incurred due to any investigation of the Premise or any cleanup, removal or restoration mandated by a federal, state or local agency or political subdivision and any repairs to the Premises required in connection with a violation by Tenant of this Paragraph 9. The foregoing indemnity shall survive the expiration or earlier termination of this Lease.

(f) Landlord shall indemnify, defend and hold Tenant and its partners, members, directors, officers, agents and employees harmless from and against all claims arising out of or in connection with, or otherwise relating to (i) the presence of any Hazardous Materials in or about the Premises or the Building not caused by Tenant or Tenant’s Parties, or (ii) any removal, cleanup, or restoration work required due to the existence of such Hazardous Materials.

(g) The provisions of this Paragraph 9 shall survive the expiration or earlier termination of the term of this Lease.

10. TAXES ON TENANT’S PROPERTY

Tenant shall pay before delinquency any and all taxes, assessments, license fees, and public charges levied, assessed, or imposed and which become payable during the term of this

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Lease and any extension thereof upon Tenant’s equipment, fixtures, furniture, and personal property installed or located on the Premises.

11. INSURANCE

(a) Tenant shall, at Tenant’s sole cost and expense, provide and keep in force during the Lease term, a commercial general liability insurance policy with a recognized casualty insurance company qualified to do business in California, insuring against liability occasioned by an occurrence in, on, about, or related to the Premises, or arising out of the condition, use, occupancy, alteration or maintenance of the Premises, having a combined single limit for both bodily injury and property damage in an amount not less than One Million Dollars ($1,000,000) per occurrence and an aggregate of not less than Two Million Dollars ($2,000,000). Such coverage may be provided by any combination of primary or excess insurance policies, in Tenant’s discretion Tenant’s liability insurance policy shall include Contractual Liability coverage and shall include Landlord and Landlord’s property manager as additional insureds. All such insurance carried by Tenant shall be carried with companies that have a general policyholder’s rating of not less than “A-” and a financial rating of not less than Class “VIII” in the most current edition of Best’s Insurance Reports; shall provide that such policies shall not be subject to reduction or cancellation except after at least thirty (30) days’ prior written notice to Landlord; and shall be primary and not contributory. Prior to the Commencement Date of the term of this Lease and upon renewal of such policies not less than thirty (30) days prior to the expiration of the term of such coverage, Tenant shall deliver to Landlord certificates of insurance confirming that such coverage is in effect. If Tenant fails to procure and maintain the insurance required hereunder, Landlord may, but shall not be required to, order such insurance at Tenant’s expense and Tenant shall reimburse Landlord for all costs incurred by Landlord with respect thereto. Tenant’s reimbursement to Landlord for such amounts shall be deemed Additional Rent, and shall include all sums disbursed, incurred or deposited by Landlord, including Landlord’s costs, expenses and reasonable attorneys’ fees with interest thereon at the Interest Rate.

(b) Landlord shall obtain and carry in Landlord’s name, as insured, during the term of this Lease, “all risk” property insurance coverage (with rental loss insurance coverage for a period of one year) (“Landlord’s property insurance”), earthquake insurance, flood insurance (but only if required by any governmental agency), commercial general liability insurance in amounts not less than that required of Tenant, and insurance against such other risks or casualties as Landlord shall reasonably determine, including, but not limited to, insurance coverages required of Landlord by the beneficiary of any deed of trust which encumbers the Property, insuring Landlord’s interest in the Premises, any other improvements to the Premises constructed by Landlord, or by Tenant with Landlord’s prior written approval, in an amount not less than the full replacement cost of the Building and all other improvements from time to time. The proceeds of any such insurance shall be payable solely to Landlord and Tenant shall have no right or interest therein Landlord shall have no obligation to insure against loss by Tenant to Tenant’s equipment, furniture, fixtures, inventory, or other personal property of Tenant in, on, or about the Premises occurring from any cause whatsoever. Landlord’s commercial general liability insurance shall provide for contractual liability coverage of Landlord’s indemnity referred to in Paragraph 12(b).

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(c) Notwithstanding anything to the contrary contained in this Lease, the parties release each other, and their respective authorized representatives, employees, officers, directors, shareholders, managers, members, assignees, subtenants, and property managers, from any claims for damage to the Premises and to the fixtures, personal property, leasehold improvements and alterations of either Landlord or Tenant in or on the Premises that are caused by or result from risks required by this Lease to be insured against or actually insured against under any property insurance policies carried by the parties and in force at the time of any such damage, whichever is greater. This waiver applies whether or not the loss is due to the negligent acts or omissions of Landlord or Tenant or their respective authorized representatives, shareholders, managers, members, assignees, subtenants, successors, officers, directors, employees, agents, contractors, or invitees All of Landlord’s and Tenant’s repair and indemnity obligations under this Lease shall be subject to the waiver contained in this Paragraph 11(c).

(d) Each party shall cause each property insurance policy obtained by it to provide that the insurance company waives all right of recovery by way of subrogation against either party in connection with the above waiver and any damage covered by any policy; provided, however, that such provision or endorsement shall not be required if the applicable policy of insurance permits the named insured to waive rights of subrogation on a blanket basis, in which case the blanket waiver shall be acceptable. Neither party shall be liable to the other for any property damage caused by fire or any of the risks insured against under any insurance policy carried pursuant to this Lease.

12. INDEMNIFICATION

(a) Tenant shall indemnify, defend, and hold Landlord harmless from all claims, suits, actions, or liabilities for bodily injury, death or for loss or damage to property (1) that arise from any activity, work, or thing done or permitted by Tenant in or about the Premises, (2) for bodily injury or damage to property which arises in or about the Premises to the extent the injury or damage to property results from the negligent acts or omissions of Tenant, its employees, agents or contractors, or (3) that are based on any event of default by Tenant in the performance of any obligation on Tenant’s part to be performed under this Lease, except to the extent caused by the negligence or willful misconduct of Landlord or its employees, agents or contractors or a breach by Landlord of its obligations under this Lease. Tenant also waives all claims against Landlord for damages to property, or to goods, wares, and merchandise stored in, upon, or about the Premises, and for injuries to persons in, upon, or about the Premises from any cause arising at any time, except as may be caused by the negligence or willful misconduct of Landlord or its employees, agents or contractors, or the breach by Landlord of its obligations under this Lease.

(b) Landlord shall indemnify, defend, and hold Tenant harmless from all claims, suits, actions, or liabilities for personal injury, death or for loss or damage to property (1) that arise from any activity, work, or thing done or permitted by Landlord in connection with the portions of the Building which Landlord is responsible for maintaining under Paragraph 13 hereof, or in connection with Landlord’s Improvement Work under Paragraph 12 hereof or (2) that arise from bodily injury or damage to property in or about the Premises to the extent the injury or damage to property results from the negligent acts or omissions of Landlord, its

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employees, agents or contractors, or (3) that are based on any breach or default by Landlord in the performance of any obligation on Landlord’s part to be performed under this Lease.

(c) The foregoing indemnities by Tenant and Landlord shall also include reasonable costs, expenses and attorneys’ fees incurred in connection with any indemnified claim or incurred by the indemnitee in successfully establishing the right to indemnity. The indemnitor shall have the right to assume the defense of any claim subject to the foregoing indemnities with counsel reasonably satisfactory to the indemnitee. The indemnitee agrees to cooperate fully with the indemnitor and its counsel in any matter where the indemnitor elects to defend, provided the indemnitor shall promptly reimburse the indemnitee for reasonable costs and expenses incurred in connection with its duty to cooperate.

The foregoing indemnities are conditioned upon the indemnitee providing prompt notice to the indemnitor of any claim or occurrence that is likely to give rise to a claim, suit, action or liability that will fall within the scope of the foregoing indemnities, along with sufficient details that will enable the indemnitor to make a reasonable investigation of the claim.

When the claim is caused by the joint negligence or willful misconduct of Tenant and Landlord or by the indemnitor party and a third party unrelated to the indemnitor party (except indemnitor’s agents, officers, employees or invitees), the indemnitor’s duty to indemnify and defend shall be proportionate to the indemnitor’s allocable share of joint negligence or willful misconduct.

(d) Notwithstanding anything to the contrary contained herein, Landlord shall not be liable to Tenant, or to any of Tenant’s employees, agents, contractors, or invitees for any damage to Tenant’s property because of any act or negligence of any owner or occupant of adjoining or contiguous property (other than Landlord or its affiliates or subsidiaries) or other third person, or for overflow, breakage, or leakage of water, steam, gas, or electricity from pipes, wires, or otherwise in the Building.

13. LANDLORD’S IMPROVEMENT WORK; CONDITION OF THE BUILDING

Landlord shall perform the following improvements to the Building (“Landlord’s Work”) and shall complete Landlord’s Work prior to July 1, 2006:

(a) Replace the existing roof top HVAC equipment serving the Building (except for the roof top Data Air replacement), and connecting to the existing pneumatic interior controls, including replacing with new equipment the split HVAC system serving the Building, including the condensing unit on the roof and the air handler on the first floor, Landlord shall deliver to Tenant a copy of the specifications and cost estimates or bids for such new equipment. Tenant shall pay to Landlord twenty percent (20%) of the cost of such new equipment as an Operating Expense pursuant to Paragraph 5(b), amortized in equal monthly installments over the thirty-six (36) months of the initial term.

(b) Landlord shall, at Landlord’s expense, inspect and repair the roof, as necessary, to make the roof water tight, and replace that portion of the roof located in the well where the new HVAC units are to be installed.

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Subject to the performance by Landlord of Landlord’s Work, and except as otherwise expressly provided in this Lease, (1) Tenant agrees to accept the Premises in their “as is” condition as of the Commencement Date of the term of this Lease, and (2) Tenant waives all right to make repairs at the expense of Landlord, or to deduct the costs thereof from the rent, and Tenant waives all rights under Section 1941 and 1942 of the Civil Code of the State of California.

(c) At the expiration or sooner termination of this Lease, Tenant shall surrender the Premises, together with any alterations or other improvements made by Tenant with Landlord’s prior written consent which Tenant is not required to remove as a condition to Landlord’s approval of such alterations or improvements, in the same condition received on the Commencement Date, except for ordinary wear and tear and except for damage caused by casualty, the elements, acts of God or other force majeure events, a taking by eminent domain, and maintenance that is Landlord’s responsibility hereunder.

14. MAINTENANCE AND REPAIRS; ALTERATIONS; SURRENDER AND RESTORATION

(a) Landlord shall, at Landlord’s expense, keep in good order, condition, and repair and replace when necessary, the structural elements of the roof (the foundation, load bearing walls, the exterior walls (except the interior faces thereof) of the Building, (excepting any alterations, structural or otherwise, made by Tenant to the Building which are not approved in writing by Landlord prior to the construction or installation thereof by Tenant). Landlord shall perform and construct, and Tenant shall not be responsible for performing or constructing, any repairs, maintenance, or improvements (1) required as a result of any casualty damage or as a result of any taking pursuant to the exercise of the power of eminent domain, or (2) for which Landlord receives reimbursement from third parties based on construction or other warranties, contractor guarantees, or insurance claims Landlord shall use its good faith diligent efforts to collect any such sums.

(b) Landlord shall repair, maintain, and replace as needed, and shall pass through the cost thereof as Operating Expenses to the extent permitted as an Operating Expense pursuant to Paragraph 5 hereof, the roof membrane (following the completion of Landlord’s Work), the areas of the Premises outside the Building, including the landscaping, tree trimming, resurfacing and restriping of the parking lot and walkways, exterior building lighting, and parking lot lighting. In the event Tenant provides Landlord with written notice of the need for any repairs to the Premises, Landlord shall commence any such repairs promptly following receipt by Landlord of such notice and Landlord shall diligently prosecute such repairs to completion.

(c) Subject to the foregoing and except as provided elsewhere in this Lease, Tenant shall at all times at Tenant’s expense keep the Premises in good and safe order, condition, and repair Tenant shall contract for and pay directly for the janitorial service to the Building. Landlord shall execute and maintain in full force and effect throughout the term a service contract with an authorized air conditioning service company for periodic service, repairs, and replacement of parts. Landlord shall pass through the costs of such inspection reports, service, repairs, and replacement of parts as an Operating Expense Subject to the release of claims and

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waiver of subrogation contained in Paragraphs 11(c) and 11(d), if Landlord is required to make any repairs by reason of Tenant’s negligent acts or omission to act, Landlord may add the cost of such repairs to the next installment of rent which shall thereafter become due, and Tenant shall promptly pay the same upon receipt of an invoice therefor.

(d) Tenant may, from time to time, at its own cost and expense and without the consent of Landlord make nonstructural alterations to the interior of the Building, the cost of which in any one instance is Twenty-five Thousand Dollars ($25,000) or less, and the aggregate cost of all such work during the term of this Lease does not exceed Seventy-five Thousand Dollars ($75,000), provided that Tenant first notifies Landlord in writing of any such nonstructural alterations. Otherwise, Tenant shall not make any alterations, improvements, or additions to the Premises without delivering to Landlord a complete set of plans and specifications for such work and obtaining Landlord’s prior written consent thereto, which consent shall not be unreasonably withheld or delayed. If any nonstructural alterations to the interior of the Building exceed Twenty-five Thousand Dollars ($25,000) in cost in any one instance, or exceed the aggregate cost of Seventy-five Thousand Dollars ($75,000) during the term of this Lease, Tenant shall employ, at Tenant’s expense, a qualified licensed general contractor to perform such alterations pursuant to a construction contract entered into between Tenant and such contractor. The contractor and the construction contract shall be subject to Landlord’s written approval prior to commencement of construction, which approval shall not be unreasonably withheld, conditioned, or delayed. Tenant shall deliver to Landlord at Tenant’s expense a complete set of as built drawings of the Building including such alterations upon the completion thereof. Landlord may condition its consent to such work to Tenant agreeing in writing to remove any such alterations prior to the expiration of the term of this Lease and Tenant agreeing to restore the Premises to its condition prior to such alterations at Tenant’s expense. Landlord shall advise Tenant in writing at the time consent is granted whether Landlord reserves the right to require Tenant to remove any alterations from the Premises prior to the expiration of this Lease. Tenant shall not be required to remove any alterations installed by or on behalf of Pacific Data during the term of its lease of the Premises, except for those alterations listed on Exhibit C (if any).

(e) All alterations, trade fixtures and personal property installed in the Premises solely at Tenant’s expense shall during the term of this Lease remain the property of Tenant, and Tenant shall be entitled to all depreciation, amortization and other tax benefits with respect thereto. Tenant may remove any of Tenant’s personal property, furniture, or equipment not permanently affixed to the Premises (“Tenant’s Personal Property”) at any time and from time to time, provided that Tenant shall repair any damage to the Premises caused by such removal. Landlord shall have no lien or other interest whatsoever in any item of Tenant’s Personal Property. Within ten (10) days following Tenant’s request from time to time, Landlord shall execute documents in commercially reasonable form to evidence Landlord’s waiver of any right, title, lien or interest in any of Tenant’s Personal Property and giving any lenders holding a security interest or lien on such property reasonable rights of access to the Premises to remove Tenant’s Personal Property, provided that such lenders agree to repair all damage caused by such removal, such lenders shall agree not to conduct any auction or other sale of Tenant’s Personal Property on or about the Premises, and any personal property owned by Landlord remains free of such liens. Upon the expiration or sooner termination of this Lease all alterations, fixtures and improvements to the Premises, whether made by Landlord or installed by Tenant at Tenant’s

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expense, shall be surrendered by Tenant with the Premises and shall become the property of Landlord, except for those items Landlord required to be removed as a condition to and at the time of its consent pursuant to this Paragraph 14(d); provided, however that Tenant may remove Tenant’s Personal Property, but Tenant shall repair any damage to the Premises caused by such removal.

(f) Tenant, at Tenant’s sole cost and expense, shall during the term of this Lease promptly and properly observe and comply with all existing and fixture orders, regulations, rules, laws, and ordinances of all governmental agencies or authorities, and the Board of Fire Underwriters (“Laws”). Any structural changes or repairs or other repairs or changes to the Premises of any nature which would be considered a capital expenditure under generally accepted accounting principles shall be made by Landlord at Tenant’s expense if such structural repairs or changes are required by reason of the specific nature of the use of the Premises by Tenant. If such structural changes or repairs are not required by reason of the specific nature of Tenant’s use of the Premises, the cost of such structural changes or repairs, except as provided in Paragraph 14(a), shall be treated as an Operating Expense and shall be amortized in accordance with the provisions of Paragraph 5(b).

(g) Tenant shall surrender the Premises by the last day of the term of this Lease, or any earlier termination date, with all of the improvements to the Premises, parts, and surfaces thereof clean and free of debris and in good operating order, condition, and state of repair, except for ordinary wear and tear and except for damage caused by casualty, the elements, acts of God or other force majeure events, a taking by eminent domain, and maintenance that is Landlord’s responsibility hereunder, and otherwise in the condition described in Paragraph 14(d) “Ordinary wear and tear” shall not include any damage or deterioration that would have been prevented by good maintenance practice or by Tenant performing all of its obligations under this Lease. The obligations of Tenant shall include the repair of any damage occasioned by the installation, maintenance, or removal of Tenant’s trade fixtures, furnishings, equipment, and alterations, and the restoration by Tenant of the Premises to its condition prior to any alterations, additions, or improvements made by Tenant (1) if Landlord’s consent thereto was conditioned upon such removal and restoration upon expiration or sooner termination of the Lease term pursuant to Paragraph 14(d), or (2) if Tenant made any such alterations, additions, or improvements without obtaining Landlord’s prior written consent in breach of Paragraph 14(d), and within a reasonable time after the expiration or sooner termination of the Lease term Landlord gives written notice to Tenant requiring Tenant to perform such removal and restoration.

15. UTILITIES AND SERVICES

(a) Tenant shall contract for and pay directly the cost of all electricity, telephone, gas, water, heat and air conditioning service, janitorial service, refuse pick-up, sewer charges, and all other utilities or services supplied to or consumed by Tenant, its agents, employees, contractors, and invitees, on or about the Premises.

(b) Landlord shall not be liable to Tenant for any interruption or failure of any utility services to the Building or the Premises which is not caused by the negligence or willful acts of Landlord, or Landlord’s employees, agents, or contractors. Tenant shall not be relieved

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from the performance of any covenant or agreement in this Lease because of any such interruption or failure, unless Tenant’s use or occupancy of the Premises is substantially impaired thereby for a period of more than ten (10) consecutive days, in which event the Monthly Base Rent and Additional Rent payable by Tenant shall abate in the proportion to which Tenant’s use or occupancy of the Premises is impaired until such substantial impairment ceases.

16. LIENS

Tenant agrees to keep the Premises free from all liens arising out of any improvement work performed by Tenant or arising out of any other work performed, materials furnished, or obligations incurred by Tenant. Tenant shall give Landlord at least ten (10) days prior written notice before commencing any work of improvement on the Premises approved in writing by Landlord pursuant to Paragraph 14(d), the contract price for which exceeds Twenty-five Thousand Dollars ($25,000). Landlord shall have the right to post notices of non-responsibility with respect to any such work. If Tenant shall, in good faith, contest the validity of any such lien, claim or demand, then Tenant shall, at its sole expense, defend and protect itself, Landlord and the Premises against the same, and shall pay and satisfy any such adverse judgment that may be rendered thereon or provide a lien release bond in accordance with applicable law before the enforcement thereof against Landlord or the Premises.

17. ASSIGNMENT AND SUBLETTING

(a) Except as otherwise provided in this Paragraph 17, Tenant shall not assign this Lease, or any interest therein, voluntarily or involuntarily, and shall not sublet the Premises or any part thereof, or any right or privilege appurtenant thereto, without the prior written consent of Landlord in each instance pursuant to the terms and conditions set forth below, which consent shall not be unreasonably withheld, delayed, or conditioned.

(b) Prior to any assignment or sublease which Tenant desires to make, Tenant shall provide to Landlord the name and address of the proposed assignee or sublessee, true and complete copies of all documents relating to Tenant’s prospective agreement to assign or sublease, a copy of a current financial statement for such proposed assignee or sublessee, and Tenant shall specify all consideration to be received by Tenant for such assignment or sublease in the form of lump sum payments, installments of rent, or otherwise. For purposes of this Paragraph 17, the term “consideration” shall include all money or other consideration to be received by Tenant for such assignment or sublease. Within fifteen (15) days after the receipt of such documentation and other information, Landlord shall (1) notify Tenant in writing that Landlord elects to consent to the proposed assignment or sublease subject to the terms and conditions hereinafter set forth; or (2) notify Tenant in writing that Landlord refuses such consent, specifying reasonable grounds for such refusal.

(c) In deciding whether to consent to any proposed assignment or sublease, Landlord may take into account whether or not reasonable conditions have been satisfied, including, but not limited to, the following:

(1) In Landlord’s reasonable judgment, the proposed assignee or subtenant is engaged in such a business, that the Premises, or the relevant part thereof, will be

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used in such a manner which complies with Paragraph 8 hereof entitled “Use” and Tenant or the proposed assignee or sublessee submits to Landlord documentary evidence reasonably satisfactory to Landlord that such proposed use constitutes a permitted use of the Premises pursuant to the ordinances and regulations of the City of Palo Alto;

(2) The proposed assignee or sublessee shall be a reputable person or entity with sufficient financial net worth so as to reasonably indicate that it will be able to meet its obligations under this Lease or the sublease in a timely manner;

(3) The proposed assignment or sublease shall be subject to approval by Landlord’s mortgage lender if Landlord’s mortgage loan so requires. If approval of Landlord’s lender of an assignment or sublease is required by Landlord’s mortgage loan, Landlord shall use its good faith efforts to obtain such approval promptly following Tenant’s request, but Landlord may withhold Landlord’s consent to such assignment or sublease if Landlord’s mortgage lender does not approve said assignment or sublease for any reason; and

(4) Landlord’s consent to the assignment or sublease shall be in a separate instrument containing the relevant provisions of this Paragraph 17 and otherwise in form reasonably acceptable to Landlord and its counsel.

(d) As a condition to Landlord’s granting its consent to any assignment or sublease, (1) Landlord may require that Tenant pay to Landlord, as and when received by Tenant, fifty percent (50%) of the amount of any excess of the consideration to be received by Tenant in connection with said assignment or sublease over and above the rental amount fixed by this Lease and payable by Tenant to Landlord, after deducting Tenant’s Expenses (as defined below), and which shall be deducted in equal monthly installments from the excess rent over the remaining term of the Lease, in the case of an assignment, or over the term of the sublease, if the transaction is a sublease; (2) Tenant and the proposed assignee or sublessee shall demonstrate to Landlord’s reasonable satisfaction that each of the criteria referred to in subparagraph (c) above is satisfied; and (3) Tenant shall reimburse Landlord for Landlord’s reasonable attorneys’ fees incurred in reviewing and negotiating, if necessary, the assignment or sublease documentation, and in preparing and negotiating, if necessary, Landlord’s written consent to the assignment or sublease. “Tenant’s Expenses” shall include, without limitation, (i) any improvement allowance or other economic concessions (space planning allowance, moving expenses, etc.) previously approved in writing by Landlord (which approval shall not be unreasonably withheld, conditioned, or delayed) paid by Tenant to assignee or sublessee in connection with such assignment or sublease; (ii) any customary brokerage commissions in connection with the assignment or sublease; (iii) reasonable attorneys’ fees incurred by Tenant in connection with the assignment or sublease; and (iv) reasonable out-of-pocket costs of advertising the space subject to the assignment or sublease.

(e) Each assignment or sublease agreement to which Landlord has consented shall be an instrument in writing which complies with the provisions of this Paragraph 17 and in form reasonably satisfactory to Landlord, and shall be executed by both Tenant and the assignee or sublessee, as the case may be. Each such assignment or sublease agreement shall recite that it is and shall be subject and subordinate to the provisions of this Lease, that the assignee or sublessee accepts such assignment or sublease, that Tenant shall not be released from its

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obligations hereunder in the case of an assignment where Tenant survives the transaction (unless Landlord otherwise agrees in writing), that Landlord’s consent thereto shall not constitute a consent to any subsequent assignment or subletting by Tenant or the assignee or sublessee, and, except as otherwise set forth in a sublease approved by Landlord, agrees to perform all of the obligations of Tenant hereunder, including, but not limited to, the payment of rent (to the extent such obligations relate to the portion of the Premises assigned or subleased or as appropriate), and that the termination of this Lease shall, at Landlord’s sole election, constitute a termination of every such assignment or sublease.

(f) In the event Landlord shall consent to an assignment or sublease, except as otherwise provided in Paragraph 17(g), Tenant shall remain primarily liable for all obligations and liabilities of Tenant under this Lease, including, but not limited to, the payment of rent.

(g) Notwithstanding the foregoing, Tenant may, without Landlord’s prior written consent, and without any participation by Landlord in assignment and subletting proceeds, assign this Lease or sublet all or any portion of the Premises to a subsidiary, affiliate, division or corporation controlled or under common control with Tenant, or to a successor corporation to Tenant by merger, consolidation or reorganization, or to a purchaser of substantially all of Tenant’s business operations conducted on the Premises (each a “Permitted Affiliate”); provided, that except as specified hereafter (and except in cases where Tenant no longer survives the transaction), Tenant’s foregoing rights to assign this Lease or to sublet the Premises shall be subject to the following conditions: (1) there shall be no uncured Event of Default by Tenant under this Lease; (2) in the case of an assignment or subletting to a Permitted Affiliate, Tenant shall remain liable to Landlord hereunder (to the extent Tenant survives the transaction); (3) if as a result of a merger, consolidation, or reorganization Tenant is not a surviving entity, the assignee or sublessee or successor entity to Tenant shall have on the effective date of such transaction a net worth as shown on its current balance sheet certified by an officer of the assignee or sublessee or successor entity at least equal to that of Tenant immediately prior to the effective date of the assignment or sublease, or, if less, financial resources sufficient, in Landlord’s reasonable good faith judgment, to perform the obligations under the assignment or sublease, as applicable; and (4) the assignee or sublessee or successor entity shall expressly assume in writing Tenant’s obligations hereunder, including, but not limited to, the payment of rent accruing from and after the effective date of such assignment or subletting.

(h) The sale of Tenant’s capital stock in a public offering pursuant to an effective registration statement filed by Tenant with the Securities and Exchange Commission or in connection with any other bona fide financing transaction shall not be deemed an assignment, subletting, or other assignment or sublease of this Lease or the Premises, provided, that in the event of the sale, assignment or sublease of this Lease, or issuance of Tenant’s securities in connection with a merger, consolidation, or reorganization in which Tenant is not a surviving entity, the conditions set forth in Paragraph I7(g)(1), (3), and (4) shall apply.

(i) Subject to the provisions of this Paragraph 17 any assignment or sublease without Landlord’s prior written consent (where such consent is required hereunder) shall at Landlord’s election be void. The consent by Landlord to any assignment or sublease shall not

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constitute a waiver of the provisions of this Paragraph 17, including the requirement of Landlord’s prior written consent, with respect to any subsequent assignment or sublease.

(j) Tenant shall not hypothecate or encumber its interest under this Lease or any rights of Tenant hereunder, or enter into any license or concession agreement respecting all or any portion of the Premises, without Landlord’s prior written consent which shall not be unreasonably withheld, subject to all of the provisions of this Paragraph 17.

(k) In the event of any sale or exchange of the Premises by Landlord and assignment of this Lease by Landlord, Landlord shall, upon providing Tenant with written confirmation that Landlord has transferred any security deposit or Letter of Credit held by Landlord to Landlord’s successor in interest, be and hereby is entirely relieved of all liability under any and all of Landlord’s covenants and obligations contained in or derived from this Lease with respect to the period commencing with the consummation of the sale or exchange and assignment.

(l) The parties acknowledge that Landlord has the remedy described in California Civil Code Paragraph 1951.4 (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has right to sublet or assign, subject only to reasonable limitations).

18. NON-WAIVER

(a) No waiver of any provision of this Lease shall be implied by any failure of Landlord or Tenant to enforce any remedy for the violation of that provision, even if that violation continues or is repeated. Any waiver by Landlord or Tenant of any provision of this Lease must be in writing.

(b) No receipt of Landlord of a lesser payment than the rent required under this Lease shall be considered to be other than on account of the earliest rent due, and no endorsement or statement on any check or letter accompanying a payment or check shall be considered an accord and satisfaction, Landlord may accept checks or payments without prejudice to Landlord’s right to recover all amounts due and pursue all other remedies provided for in this Lease.

Landlord’s receipt of monies from Tenant after giving notice to Tenant terminating this Lease shall in no way reinstate, continue, or extend the Lease term or affect the termination notice given by Landlord before the receipt of those monies. After serving notice terminating this Lease, filing an action, or obtaining final judgment for possession of the Premises, Landlord may receive and collect any rent, and the payment of that rent shall not waive or affect such prior notice, action, or judgment.

19. HOLDING OVER

Tenant shall vacate the Premises and deliver the same to Landlord in the condition required by this Lease upon the expiration or sooner termination of this Lease. In the event of holding over by Tenant after the expiration or termination of this Lease, such holding over shall be on a month-to-month tenancy and all of the terms and provisions of this Lease shall be

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applicable during such period, except that Tenant shall pay Landlord as Monthly Base Rent during such holdover an amount equal to one hundred fifty percent (150%) of the Monthly Base Rent in effect at the expiration of the term. If such holdover is without Landlord’s written consent, Tenant shall be liable to Landlord for all costs, expenses, and consequential damages incurred by Landlord as a result of such holdover. The rental payable during such holdover period without Landlord’s consent shall be payable to Landlord on demand.

20. DAMAGE OR DESTRUCTION

(a) In the event of a total destruction of the Building and the improvements during the lease term from any cause, either party may elect to terminate this Lease effective as of the date of such casualty by giving written notice of termination to the other party within thirty (30) days after the casualty occurs. A total destruction shall be deemed to have occurred for this purpose if the Building and improvements are destroyed to the extent of sixty-five percent (65%) or more of the replacement cost thereof. If this Lease is not terminated, Landlord shall repair and restore the Building and improvements in a diligent manner and this Lease shall continue in full force and effect, except that Monthly Base Rent and Additional Rent shall be abated in accordance with Paragraph 20(f) below.

(b) Subject to Paragraph 20(d), in the event of a partial destruction of the Building and improvements to an extent less than sixty-five percent (65%) of the replacement cost thereof and if the damage thereto can be repaired, reconstructed, or restored within a period of one hundred eighty (180) days from the date of such casualty, and if the casualty is from a cause which is insured (or required to be insured) under Landlord’s “all risk” property insurance, or is insured under any other coverage then carried by Landlord, Landlord shall forthwith repair the same, and this Lease shall continue in full force and effect, except that Monthly Base Rent and Additional Rent shall be abated in accordance with Paragraph 20(f) below. If any of the foregoing conditions is not met, Landlord shall have the option of either repairing and restoring the Building and improvements, or terminating this Lease effective as of the date of the casualty by giving written notice of termination to Tenant within thirty (30) days after the casualty, subject to the provisions of Paragraph 20(c). Notwithstanding anything to the contrary contained in this Paragraph 20, except as set forth in Paragraph 20(d), Landlord shall not have the right to terminate this Lease if the cost to repair the damage to the Building and improvements would cost less than five percent (5%) of the replacement cost of the Building and improvements, regardless of whether or not the casualty is insured or required to be insured. Notwithstanding anything to the contrary contained in this Paragraph 20, if the cost to repair the damage to the Building and improvements exceeds five percent (5%) of the replacement cost of the Building and improvements, and Landlord elects to terminate this Lease, Tenant may nullify the effect of such termination by giving Landlord written notice within ten (10) days after receipt by Tenant of Landlord’s notice of termination that Tenant elects to repair the damage to the Building and improvements at Tenant’s sole cost (to the extent the costs exceed Landlord’s insurance proceeds), in which event this Lease shall remain in effect, provided that rent abatement shall not extend beyond the date that the restoration is completed.

(c) In the event of a partial destruction of the Building and improvements to an extent less than sixty-five percent (65%) of the replacement cost thereof, and the damage cannot be repaired, reconstructed, or restored within a period of one hundred eighty (180) days

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from the date of such casualty, Tenant may terminate this Lease effective as of the date of the casualty by giving written notice of termination to Landlord within thirty (30) days after Tenant’s receipt from Landlord of a notice stating Landlord’s good faith estimate of the time required to repair, restore or reconstruct the damaged portions of the Building or Premises and such estimated time exceeds one hundred eighty (180) days. The foregoing shall not affect Landlord’s termination rights under subparagraph (b) above.

Furthermore, if such casualty is from a cause which is not insured or not required by this Lease to be insured under Landlord’s “all risk” property insurance, or is not insured under any other insurance carried by Landlord, Landlord may elect to repair and restore the Building and improvements (provided that Tenant has not elected to terminate this Lease pursuant to the first sentence of this Paragraph 20(c) or Paragraph 20(d)), or Landlord may terminate this Lease effective as of the date of the casualty by giving written notice of termination to Tenant, subject to the limitations of Paragraph 20(b). Landlord’s election to repair and restore the Building and improvements or to terminate this Lease shall be made and written notice thereof shall be given to Tenant within forty-five (45) days after the casualty. Notwithstanding the foregoing, (1) if Landlord has not obtained all necessary governmental permits for the restoration and commenced construction of the restoration within one hundred twenty (120) days after the casualty, Tenant may terminate this Lease by written notice to Landlord given at any time prior to the actual commencement of construction of the restoration; or (2) if Landlord elects to repair and restore the Building and improvements under subparagraph (b) or (c) above, but the repairs and restoration are not substantially completed within two hundred ten (210) days after the casualty, plus the period of any delays in the completion of the repairs and restoration caused by strikes, labor disputes, unavailability of materials, inclement weather, or acts of God (“force majeure delays”), Tenant may terminate this Lease by written notice to Landlord given within thirty (30) days after the expiration of said period of two hundred ten (210) days after the casualty plus the period of any force majeure delays, but not by more than sixty (60) additional days.

(d) Notwithstanding anything to the contrary contained in this Paragraph 20, if at any time during the last twelve (12) months of the term of this Lease, there is damage to the Building and improvements for which the cost to repair exceeds five percent (5%) of the replacement cost the Building and improvements, whether or not an insured loss, both Landlord and Tenant shall have the option to terminate this Lease effective as of the date of occurrence of such damage by giving written notice to the other party of its election to do so within fifteen (15) days after the date of such damage. However, if Landlord elects to terminate this Lease and Tenant is not then in default under the Lease, Tenant may negate Landlord’s election to terminate under this Paragraph 20(d) by electing, within ten (10) days after receipt of Landlord’s termination notice, to exercise any unexercised option to extend this Lease. If Tenant negates Landlord’s election, this Lease shall continue in effect.

(e) If this Lease is not terminated by Landlord or Tenant pursuant to the foregoing provisions, Landlord shall complete the repairs in a diligent manner and this Lease shall continue in full force and effect, except that Monthly Base Rent and Additional Rent shall be abated in accordance with Paragraph 20(f) below.

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(f) In the event of repair, reconstruction, or restoration as provided herein, the Monthly Base Rent and Additional Rent shall be abated proportionally in the ratio which the Tenant’s use of the Premises is impaired during the period of such repair, reconstruction, or restoration, from the date of the casualty until such repair, reconstruction or restoration is completed.

(g) With respect to any destruction of the Building and improvements which Landlord is obligated to repair, or may elect to repair, under the terms of this Paragraph 20, the provisions of Section 1932, Subdivision 2, and of Section 1933, Subdivision 4, of the Civil Code of the State of California are waived by the parties. Landlord shall repair and restore any leasehold improvements constructed thereafter by Landlord, or by Tenant with Landlord’s prior written consent.

(h) In the event of termination of this Lease pursuant to any of the provisions of this Paragraph 20, the Monthly Base Rent and Additional Rent shall be apportioned on a per diem basis and shall be paid to the date of the casualty. In no event shall Landlord be liable to Tenant for any damages resulting to Tenant from the occurrence of such casualty, or from the repairing or restoration of the Building and improvements, or from the termination of this Lease as provided herein, nor shall Tenant be relieved thereby from any of Tenant’s obligations hereunder, except to the extent and upon the conditions expressly set forth in this Paragraph 20, and except in the event of termination of the Lease by either party in which case Tenant shall be relieved of its obligations under the Lease accruing from and after the date of such termination.

21. EMINENT DOMAIN

(a) If the whole or any substantial part of the Building shall be taken or condemned by any competent public authority for any public use or purpose, the term of this Lease shall end upon the earlier to occur of the date when the possession of the part so taken shall be required for such use or purpose or the vesting of title in such public authority. Tenant shall be entitled to receive any damages separately awarded by the court for (1) leasehold improvements installed at Tenant’s expense or other property owned by Tenant, and (2) reasonable costs of moving by Tenant to another location in Santa Clara County, California. The entire balance of the award shall be the property of Landlord.

(b) If there is a partial taking of the Premises by eminent domain which is not a substantial part of the Building and the balance of the Premises remains reasonably suitable for continued use and occupancy by Tenant for the purposes referred to in Paragraph 8, Landlord shall complete any necessary repairs in a diligent manner and this Lease shall remain in full force and effect with a just and proportionate abatement of the Monthly Base Rent and Additional Rent, based on the extent to which Tenant’s use of the Premises is impaired thereafter. If after a partial taking, the Premises are not reasonably suitable for Tenant’s continued use and occupancy for the uses permitted herein, Tenant may terminate this Lease effective on the earlier of the date title vests in the public authority or the date possession is taken. Subject to the provisions of Paragraph 21(a), the entire award for such taking shall be the property of Landlord.

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22. REMEDIES

If Tenant fails to make any payment of rent or any other sum due under this Lease for five (5) days or more after the same is due; or if Tenant breaches any other term of this Lease for thirty (30) days or more after receipt by Tenant of written notice from Landlord (unless such default is reasonably incapable of cure within thirty (30) days and Tenant commences cure within thirty (30) days and diligently prosecutes the cure to completion within a reasonable time); or if Tenant’s interest herein, or any part thereof, is assigned or transferred, either voluntarily or by operation of law (except as expressly permitted by other provisions of this Lease); or if Tenant makes a general assignment for the benefit of its creditors; or if this Lease is rejected (1) by a bankruptcy trustee for Tenant, (2) by Tenant as debtor in possession, or (3) by failure of Tenant as a bankrupt debtor to act timely in assuming or rejecting this Lease; then any of such events shall constitute an event of default and breach of this Lease by Tenant and Landlord may, at its option, elect the remedies specified in either subparagraph (a) or (b) below. Any such rejection of this Lease referred to above shall not cause an automatic termination of this Lease. Whenever in this Lease reference is made to a default by Tenant, such reference shall refer to an event of default (“Event of Default”) by Tenant as defined in this Paragraph 22.

(a) Landlord may repossess the Premises and remove all persons and property therefrom. If Landlord repossesses the Premises because of an Event of Default by Tenant, this Lease shall terminate and Landlord may recover from Tenant:

(1) the worth at the time of award of the unpaid rent which had been earned at the time of termination including interest thereon at a rate equal to the Federal discount rate plus one percent (1%), or the maximum legal rate of interest, whichever is less, from the time of termination until paid;

(2) the worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided, including interest thereon at a rate equal to the Federal discount rate plus one percent (1%) per annum, or the maximum legal rate of interest, whichever is less, from the time of termination until paid;

(3) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss for the same period that Tenant proves could be reasonably avoided, discounted at the discount rate published by the Federal Reserve Bank of San Francisco for member banks at the time of award plus one percent (1%); and

(4) any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant’s breach or by Tenant’s failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom.

(b) If Landlord does not repossess the Premises, then this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession and Landlord may enforce all of its rights and remedies under this Lease, including the right to recover the rent

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and other sums due from Tenant hereunder For the purposes of this Paragraph 22, the following do not constitute a repossession of the Premises by Landlord or a termination of the Lease by Landlord:

(1) Acts of maintenance or preservation by Landlord or efforts by Landlord to relet the Premises; or

(2) The appointment of a receiver by Landlord to protect Landlord’s interests under this Lease.

23. TENANT’S PERSONAL PROPERTY

If any personal property of Tenant remains on the Premises after (1) Landlord terminates this Lease pursuant to Paragraph 22 above following an Event of Default by Tenant, or (2) after the expiration of the Lease term or after the termination of this Lease pursuant to any other provisions hereof, Landlord shall give written notice thereof to Tenant pursuant to applicable law. Landlord shall thereafter release, store, and dispose of any such personal property of Tenant in accordance with the provisions of applicable law.

24. NOTICES

(a) All notices, statements, demands, requests, or consents given hereunder by either party to the other shall be in writing and shall be personally delivered, or shall be sent by a recognized overnight delivery service, or shall be sent by United States mail, first class, or registered or certified, return receipt requested, postage prepaid, and addressed to the parties as follows:

Landlord:	Park Place Associates
	c/o Vance Brown, Inc.
	3197 Park Boulevard
	Palo Alto, California 94306
	Attention: Property Manager
Tenant:	Danger, Inc.
	3101 Park Boulevard
	Palo Alto, California 94306
	Attention: CFO
With a copy to:	Danger, Inc.
	3101 Park Boulevard
	Palo Alto, California 94306
	Attention: General Counsel

Either party may change its address for notice by giving written notice to the other party of the new address for notice in accordance with subparagraph (b) below.

(b) When personally delivered to the recipient, notice shall be effective on delivery; when mailed first class to the last address known to the party giving notice, notice shall

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be effective on delivery; when mailed by certified mail with return receipt requested, notice shall be effective on receipt if delivery is confirmed by a return receipt; when delivered by recognized overnight delivery service with charges prepaid or charged to sender’s account, notice is effective on delivery if delivery is confirmed by the delivery service.

25. ESTOPPEL CERTIFICATES

Tenant and Landlord shall within fifteen (15) days following request by the other party (the “Requesting Party”), execute and deliver to the Requesting Party an Estoppel Certificate (1) certifying that this Lease has not been modified and certifying that this Lease is in full force and effect, or, if modified, stating the nature of such modification and certifying that this Lease, as so modified, is in full force and effect; (2) stating the date to which the rent and other charges are paid in advance, if at all; (3) stating the amount of any security deposit held by Landlord; (4) acknowledging that there are not, to the responding party’s knowledge, any uncured defaults on the part of the Requesting Party hereunder, or if there are uncured defaults on the part of the Requesting Patty, stating the nature of such uncured defaults; and (5) any other provisions reasonably requested by either party.

26. PARKING

Tenant shall have the use of all parking spaces on the Premises, including all parking spaces at grade and under the Building.

27. SIGNAGE

Tenant shall have the right to retain all of Tenant’s existing signage on the Premises. Tenant shall not place any other signs on or about the exterior of the Building or on the areas of the Premises outside of the Building without obtaining Landlord’s prior written approval of the size and design of such signs, obtaining necessary City approvals, and complying with applicable City ordinances and regulations. Tenant shall promptly remove all such signage at Tenant’s expense upon the expiration or sooner termination of this Lease.

28. TENANT’S BROKER

Landlord and Tenant warrant to each other that (a) each has had no dealings with any real estate broker or agent in connection with the negotiation of this Lease, except Trammell Crow Company (“Tenant’s Broker”) whose commission shall be payable by Tenant pursuant to a separate agreement between Tenant and Tenant’s Broker, and (b) neither of them knows of any real estate broker or agent (other than Tenant’s Broker), who is or might be entitled to a commission in connection with this Lease. Landlord and Tenant each hereby agree to indemnify, defend, and hold harmless the other from and against any losses, causes of actions, liabilities, liens, damages, claims, demands, costs and expenses (including reasonable attorneys’ fees and costs) incurred, or to be incurred, by reason of any breach of the foregoing warranty by either party hereto with respect to any such dealings with any and all real estate broker(s) or agent(s) (other than Tenant’s Broker whose commission shall be payable by Tenant).

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29. SUBORDINATION; ATTORNMENT

This Lease, without any further instrument, shall at all times be subject and subordinate to any and all mortgages and deeds of trust which may now or hereafter affect Landlord’s estate in the real property of which the Premises form a part, and to all advances made or hereafter to be made upon the security thereof, and to all renewals, modifications, consolidations, replacements and extensions thereof. In confirmation of such subordination, Tenant shall promptly execute, acknowledge, and deliver to Landlord upon request any subordination, non-disturbance, and attornment agreement or other instrument with respect to any existing deed of trust, or any deed of trust executed by Landlord hereafter, which is approved by Landlord’s lender, is in commercially reasonable form, and which provides that so long as Tenant is not in default hereunder beyond any applicable cure period that upon acquiring title to the real property of which the Premises form a part by foreclosure or otherwise (1) this Lease shall not be terminated, and (2) such holder or other person or persons purchasing or otherwise acquiring the real property of which the Premises form a part by foreclosure or otherwise shall recognize all of Tenant’s rights hereunder which accrue thereafter and shall not disturb Tenant’s right to quiet enjoyment of the Premises under the terms of this Lease, on the condition that Tenant agrees in writing to attorn to such holder or purchaser. Said non-disturbance agreements shall be in recordable form and may be recorded by either Landlord or Tenant at such party’s election and expense.

30. BREACH BY LANDLORD

(a) Landlord shall not be deemed in breach of this Lease unless Landlord fails within a reasonable time to perform an obligation required to be performed by Landlord pursuant to this Lease. For purposes of this Paragraph 30, a reasonable time shall in no event be less than thirty (30) days after receipt by Landlord, and by the holders of any mortgage or deed of trust covering the Premises whose name and address have been furnished to Tenant in writing for such purposes, of written notice specifying wherein such obligation of Landlord has not been performed; provided, however, that if the nature of Landlord’s obligation is such that more than thirty (30) days after such notice are reasonably required for its performance, then Landlord shall not be in breach of this Lease if performance is commenced within such thirty (30) day period and thereafter diligently pursued to completion.

(b) In the event of a breach of this Lease by Landlord, Tenant’s sole remedy shall be to institute an action against Landlord for damages or for injunctive or equitable relief, but Tenant shall not have the right to rent abatement, to offset against rent, or to terminate this Lease. Tenant expressly waives the defense of constructive eviction.

31. LANDLORD’S ENTRY

Except in the case of an emergency and except for permitted entry during Tenant’s normal working hours for regularly scheduled maintenance, Landlord and Landlord’s agents shall provide Tenant with at least twenty-four (24) hours’ notice prior to entry of the Premises by Landlord and Landlord’s agents. Such entry by Landlord and Landlord’s agents shall not interfere with Tenant’s operations more than reasonably necessary, and Landlord shall exercise reasonable efforts to comply with Tenant’s reasonable security measures and Tenant’s safety

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protocols, provided that such security measures and safety protocols are known by Landlord. If required by Tenant, Landlord and Landlord’s agents shall at all times be accompanied by a representative of Tenant during any such entry except in case of emergency Landlord may enter the Premises without prior notice to Tenant if Tenant has abandoned or surrendered the Premises.

32. ATTORNEYS’ FEES

If any action at law or in equity shall be brought to recover any rent under this Lease, or for or on account of any breach of or to enforce or interpret any of the provisions of this Lease or for recovery of the possession of the Premises, the prevailing party shall be entitled to recover from the other party costs of suit and reasonable attorneys’ fees, the amount of which shall be fixed by the court and shall be made a part of any judgment rendered.

33. QUIET POSSESSION

So long as no Event of Default by Tenant remains uncured, Tenant shall have quiet enjoyment and possession of the Premises for the entire term hereof subject to all of the provisions of this Lease.

34. GENERAL PROVISIONS

(a) Nothing contained in this Lease shall be deemed or construed by the parties hereto or by any third person to create the relationship of principal and agent or of partnership or of joint venture of any association between Landlord and Tenant, and neither the method of computation of rent nor any other provisions contained in this Lease nor any acts of the parties hereto shall be deemed to create any relationship between Landlord and Tenant other than the relationship of landlord and tenant.

(b) Each and all of the provisions of this Lease shall be binding upon and inure to the benefit of the parties hereto, and except as otherwise specifically provided elsewhere in this Lease, their respective heirs, executors, administrators, successors, and assigns, subject at all times, nevertheless, to all agreements and restrictions contained elsewhere in this Lease with respect to the assignment, transfer, encumbering, or subletting of all or any part of Tenant’s interest in this Lease.

(c) The captions of the paragraphs of this Lease are for convenience only and shall not be considered or referred to in resolving questions of interpretation or construction.

(d) This Lease is and shall be considered to be the only agreement between the parties hereto and their representatives and agents. All negotiations and oral agreements acceptable to both parties have been merged into and are included herein. There are no other representations or warranties between the patties and all reliance with respect to representations is solely upon the representations and agreements contained in this instrument.

(e) The laws of the State of California shall govern the validity, performance, and enforcement of this Lease. Notwithstanding which of the parties may be deemed to have prepared this Lease, this Lease shall not be interpreted either for or against Landlord or Tenant,

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but this Lease shall be interpreted in accordance with the general tenor of the language in an effort to reach an equitable result.

(f) Time is of the essence with respect to the performance of each of the covenants and agreements contained in this Lease.

(g) Recourse by Tenant for breach of this Lease by Landlord shall be expressly limited to the amount of Landlord’s interest in the Premises and the rents, issues, insurance and condemnation proceeds, sales proceeds, and profits therefrom, and in the event of any such breach or default by Landlord Tenant hereby waives the right to proceed against any other assets of Landlord or against any other assets of any manager or member of Landlord.

(h) Any provision or provisions of this Lease which shall be found to be invalid, void or illegal by a court of competent jurisdiction, shall in no way affect, impair, or invalidate any other provisions hereof, and the remaining provisions hereof shall nevertheless remain in full force and effect.

(i) This Lease may be modified in writing only, signed by the parties in interest at the time of such modification.

(j) Each party represents to the other that the person or persons signing this Lease on its behalf are properly authorized to do so. Upon the request of either party, evidence of the written authority of such person or persons to sign on behalf of the other party shall be provided to the requesting party hereto either prior to or simultaneously with the return to the requesting party of a fully executed copy of this Lease.

(k) No binding agreement between the parties with respect to the Premises shall arise or become effective until this Lease has been duly executed by both Tenant and Landlord and a fully executed copy of this Lease has been delivered to both Tenant and Landlord.

(l) Subject to the provisions of Paragraph 30(b), the rights and remedies that either party may have under this Lease or at law or in equity, upon any breach, are distinct, separate and cumulative and shall not be deemed inconsistent with each other, and no one of them shall be deemed to be exclusive of any other.

(m) Landlord and Tenant waive any claim for consequential damages which one may have against the other for breach of or failure to perform or observe the requirements and obligations created by this Lease.

(n) This Lease shall not be recorded by either party without the prior written consent of the other party.

(o) Whenever this Lease requires an approval, consent, determination, selection or judgment by either Landlord or Tenant, unless another standard is expressly set forth, such approval, consent, determination, selection or judgment and any conditions imposed thereby shall be reasonable and shall not be unreasonably withheld, conditioned, or delayed and,

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in exercising any right or remedy hereunder, each party shall at all times act reasonably and in good faith.

(p) Any expenditure by a party permitted or required under this Lease, for which such party demands reimbursement from the other party, shall be limited to the fair market value of the goods and services involved, shall be reasonably incurred, and shall be substantiated by documentary evidence available for inspection and review by the other party.

IN WITNESS WHEREOF, the Landlord and Tenant have duly executed this Lease as of the date first set forth herein.

“Landlord”
PARK PLACE ASSOCIATES, a California general partnership
By:	Park City Leasing, L.P., a California limited partnership Its Managing General Partner
	By:	Vance Brown, Inc., a California corporation Its General Partner
		By:	/s/ [ILLEGIBLE], Chairman
“Tenant”
DANGER, INC. a Delaware corporation
By:	/s/ Henry R. Nothhaft, CEO
	Its
By:	/s/ Nancy Hilker, CFO
	Its

[SIGNATURE PAGE TO LEASE]

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EXHIBIT A

COMMENCEMENT MEMORANDUM

Date:                     , 2007

This Commencement Memorandum is entered into with respect to the Lease dated March 14, 2006 (the “Lease”) between Park Place Associates, a California limited liability company (“Landlord”), and Danger, Inc., a California corporation (“Tenant”), of the premises located at 3101 Park Boulevard, Palo Alto, California (the “Premises”).

In accordance with the Lease, Landlord and Tenant confirm and agree as follows:

1. That the Premises are accepted by Tenant in the condition required by the Lease on the date hereof;

2. That Tenant is in possession of the Premises and hereby acknowledges that under the provisions of the Lease the Commencement Date of the term of the Lease is January 1, 2007 and the Expiration Date of the initial term of the Lease is December 31, 2009;

3. That in accordance with the provisions of the Lease, Monthly Base Rent and Operating Expenses and Taxes commence to accrue on January 1, 2007; and

4. Rent is due and payable by Tenant in advance on the first day of each and every month during the term of the Lease. Tenant’s rent checks should be made payable to Park Place Associates and mailed to Park Place Associates, c/o Vance Brown, Inc., 3197 Park Boulevard, Palo Alto, California 94306, Attention: Property Manager.

AGREED AND ACCEPTED
LANDLORD			TENANT
PARK PLACE ASSOCIATES,			DANGER, INC.,
a California general partnership			a Delaware corporation
By:	Park City Leasing, L P,
	a California limited partnership Its Managing General Partner		By:
	By:	Vance Brown, Inc.,
		a California corporation
		Its General Partner
	By:

A-1

EXHIBIT B

TENANT’S HAZARDOUS MATERIALS

B-1

EXHIBIT C

ALTERATIONS BY PACIFIC DATA IMAGES, INC. (TO BE REMOVED)

C-1

EX-10.24

Exhibit 10.24

LEASE

between

PARMENTER GCC LP, LLLP (“Landlord”)

and

DANGER, INC. (“Tenant”)

for premises located at

GWINNETT COMMERCE CENTER

3700 Crestwood Parkway

Duluth, GA 30096

TABLE OF CONTENTS

		Page
1.	SUMMARY OF LEASE	4
2.	DEFINITIONS	5
3.	LEASE GRANT	7
4.	LEASE TERM	8
5.	BASE RENTAL	8
6.	ADDITIONAL RENT	8
7.	LATE PAYMENTS	9
8.	OCCUPANCY AND USE	9
9.	HAZARDOUS SUBSTANCES	10
10.	COMPLIANCE WITH LAWS	10
11.	SERVICE AND UTILITIES	10
12.	IMPROVEMENTS ON PREMISES	11
13.	GRAPHICS	11
14.	CARE OF PREMISES	11
15.	ALTERATIONS	11
16.	REPAIR	11
17.	PARKING	11
18.	RE-ENTRY BY LANDLORD	12
19.	ASSIGNMENT AND SUBLETTING	12
20.	DISCHARGE OF LIENS	13
21.	INSURANCE	13
22.	WAIVER OF SUBROGATION / INDEMNITY	14
23.	DAMAGE BY FIRE, ETC	15
24.	CONDEMNATION	15
25.	EVENTS OF DEFAULT	16
26.	LANDLORD’S REMEDIES	16
27.	QUIET ENJOYMENT	18
28.	SURRENDER OF PREMISES	18
29.	SUBORDINATION AND ATTORNMENT	18
30.	TENANT ESTOPPEL LETTER	19
31.	WAIVER	19
32.	SECURITY DEPOSIT	19
33.	NOTICES	20
34.	CAPTIONS AND REFERENCES	21
35.	SUCCESSORS AND ASSIGNS	21

36.	SEVERABILITY	21
37.	GOVERNING LAW	21
38.	FORCE MAJEURE	21
39.	TIME OF ESSENCE	21
40.	ENTIRE AGREEMENT	21
41.	SURVIVAL OF TENANT’S OBLIGATIONS	21
42.	HOLDING OVER	21
43.	CORPORATE AUTHORITY	21
44.	MORTGAGE APPROVALS	21
45.	LANDLORD’S LIEN	21
46.	LANDLORD’S LIABILITY	21
47.	RIGHT TO RELOCATE	21
48.	RULES AND REGULATIONS	22
49.	TRANSFERS BY LANDLORD	22
50.	COMMISSIONS	22
51.	SUBMISSION OF LEASE	22
52.	FINANCIAL STATEMENTS	22
53.	SPECIAL STIPULATIONS	22

LEASE

Gwinnett Commerce Center

Duluth, GA 30096

THIS LEASE (hereinafter referred to as the “Lease”), made and entered into on the      day of             , 2006, between Parmenter GCC LP, LLLP, a Delaware Limited Partnership (hereinafter referred to as “Landlord”) and Danger, Inc., a Delaware corporation (hereinafter referred to as “Tenant”).

WITNESSETH:

1. Summary of Lease. The following is a summary of certain portions of the Lease:

(a)	Landlord:	Parmenter GCC LP, LLLP, a Delaware Limited Partnership
(b)	Landlord’s Address:	Parmenter GCC LP, LLLP c/o Parmenter Realty Partners 3700 Crestwood Parkway, Suite 180 Duluth, GA 30096
(c)	Other Address:	Parmenter GCC LP, LLLP c/o Parmenter Realty Partners 1111 Brickell Avenue, Suite 2910 Miami, Florida 33131
(d)	Tenant:	Danger, Inc., a Delaware corporation
(e)	Tenant’s Address:	prior to the Commencement Date: 3101 Park Boulevard Palo Alto, CA 94306 following the Commencement Date: 3700 Crestwood Parkway, Suite 300 Duluth, GA 30096
		with a copy to: 3101 Park Boulevard Palo Alto, CA 94306
(f)	Building Address:	3700 Crestwood Parkway Duluth, GA 30096
(g)	Suite Number:	Suite 300
(h)	Floor(s) upon which the Premises are located:	Third
(i)	Lease Term:	Five (5) years
(j)	Commencement Date:	April 1, 2006, subject to the provisions of Section 4 of the Lease
(k)	Expiration Date:	March 31, 2011, unless sooner terminated in accordance with the terms of the Lease, unless extended by agreement between Landlord and Tenant, and subject to the terms of Section 4 of the Lease
(l)	Base Rental:	$109,960.50 per annum
(m)	Monthly Base Rental:	$9,163.38
(n)	Prepaid Rental	The amount of $9,163.38

(o)	Rentable Area of Premises:	5,639 square feet. The rentable area of the Premises as set forth in this Section 1(o) is binding upon the parties and shall not be changed at any time during the Lease Term, as extended pursuant to the terms of this Lease, except as the area of the Premises may be expanded pursuant to Paragraphs 5 and 6 of Exhibit “B”.
(p)	Rentable Area of Building:	211,039 square feet. The rentable area of the Building as set forth in this Section 1(p) is binding upon the parties and shall not be changed at any time during the Lease Term, as extended pursuant to the terms of this Lease.
(q)	Tenant’s Percentage of Building:	2.672 percent. This percentage is calculated by dividing the rentable area of Premises by the rentable area of the Building.
(r)	Security Deposit:	$125,000.00 in accordance with the terms of Section 32 hereof.
(s)	Number of parking spaces	Seventeen (17) allocated but unreserved parking spaces and four (4) reserved parking spaces, which shall be available to Tenant during the initial term of this Lease and any extension term, without additional charge.
(t)	Broker:	Parmenter Realty & Investment Company (“Landlord’s Broker” CRESA Partners of Georgia, LLC (“Tenant’s Broker”)

IT IS UNDERSTOOD THAT THE FOREGOING IS INTENDED AS A SUMMARY OF PORTIONS OF THE LEASE FOR CONVENIENCE ONLY AND IF THERE IS A CONFLICT BETWEEN THE ABOVE SUMMARY AND ANY PROVISIONS OF THIS LEASE HEREINAFTER SET FORTH, THE FORMER SHALL CONTROL.

2. Definitions.

(a) “Building” means the office building located upon certain real property (the “Property”) in Land Lot(s) 203 of the 6th District of Gwinnett County, Georgia being Lot 3, Block B of Crestwood Subdivision the address of which is 3700 Crestwood Parkway, Duluth, GA 30096.

(b) “Premises” or “Leased Premises” means the office space which is located in the Building and shown on the drawing attached hereto as Exhibit “A”.

(c) “Base Rental” means the annual rental set forth in Section 1 hereof, as the same may be increased from time to time pursuant to the provisions of this Lease.

(d) “Commencement Date” means April 1, 2006, subject to Section 4 of the Lease.

(e) “Expiration Date” means March 31, 201, unless sooner terminated or extended pursuant to this Lease and subject to Section 4 of this Lease.

(f) “Security Deposit” means the sum set forth in Section 1 above, which has been deposited with Landlord by Tenant.

(g) “Common Areas” means those areas of the Building devoted to the lobby of the Building, common corridors, elevator foyers, restrooms, mechanical rooms, janitorial closets, electrical and telephone closets, vending areas and other similar facilities for public and common use (but shall not include any such areas provided or reserved for the exclusive use of a particular tenant). Common Areas shall be measured from and to the inside finished surface of exterior Building walls, and from and to the center of any partition walls which separate Common Areas from tenant spaces, including the Premises, and from Service Areas. It shall be Landlord’s responsibility to maintain the Common Areas in good order and repair, subject to reimbursement by Basic Costs as permitted under this Lease.

(h) “Service Areas” means those areas within the Building used for Building stairs, fire towers, elevator shafts, flues, vents, stacks, pipe shafts and vertical ducts (but shall not include any such areas provided or reserved for the exclusive use of a particular tenant). Service Areas shall be measured from and to the inside finished surface of exterior Building walls, and from and to the center of any partition walls which separate Service Areas from tenant spaces, including the Premises, and from Common Areas.

(i) “Exterior Common Areas” means all areas, not located within the Building, provided and maintained for the common use and benefit of Landlord and tenants of the Building generally, and the employees, invitees and licensees of Landlord and such tenants, including, without limitation, parking areas (whether enclosed or not), streets, sidewalks, and landscaped areas (including Landlord’s interest in any such areas which are part of the “common areas” established pursuant to the Declaration of Covenants, Conditions and Restrictions affecting the Building). It shall be

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Landlord’s responsibility to maintain the Exterior Common Areas in good order and repair, subject to reimbursement by Basic Costs as permitted under this Lease.

(j) “Rentable Area of the Premises” means (1) the gross area of the Premises as measured from and to the inside surface of the outer glass of the exterior Building walls, and from and to the center of any partition walls which separate the Premises from adjoining Common Areas, Service Areas, or premises of other tenants; plus (2) an area equal to the gross area of the Common Areas, measured by the method described in Paragraph 2(g), times a fraction, the numerator of which is the gross area of the Premises as described in (1) above and the denominator of which is the Rentable Area of the Building, as hereinafter defined, which Landlord and Tenant have stipulated to be the Rentable Area of the Premises set forth in the Lease summary in Paragraph 1. “Rentable Area of the Building” means the gross area of the Building as measured from and to the inside surface of the outer glass of the exterior Building walls, and from and to the center of any partition walls of any Service Areas, which Rentable Area of the Building is set forth in the Lease summary in Paragraph 1.

(k) “Basic Costs” means all expenses, costs and disbursements (but not repayment of debt or replacement of capital investment items other than those elsewhere herein expressly included, nor specific costs specially billed to and paid by other tenants of the Building) of every kind and nature which Landlord shall pay or become obligated to pay because of, or in connection with, the ownership and operation of the Building, the Property and the Exterior Common Areas, including but not limited to the following, with the understanding that Landlord shall use commercially reasonable efforts to operate the Building in an economically reasonable manner: (i) wages and salaries, including payroll taxes, workers’ compensation, insurance premiums, and all other employment benefit and insurance costs to Landlord of all employees directly engaged in operating and maintaining the Building, and that part of central accounting costs which are applicable to the Building; (ii) costs of all supplies and materials used in operation and maintenance of the Building; (iii) cost of all utilities for the Building including the cost of water, sewer, gas, oil and electric and other fuels or forms of power or energy; (iv) cost of all maintenance and service agreements (oral or written) for the Building and the equipment therein including, but not limited to, security service, window cleaning, janitorial service, elevator maintenance, maintenance of heating, ventilation and air-conditioning equipment, plumbing, controls, locks, alarms and all other parts of the Building; (v) landscaping and grounds maintenance costs and expenses; (vi) annual and special assessments against the Property made pursuant to the Declaration of Covenants, Conditions and Restrictions by the Owners Associations; (vii) cost of all insurance relating to the Building or rents therefrom including, but not limited to, the costs of casualty and liability insurance applicable to the Building and the Exterior Common Areas and to Landlord’s personal property used in connection with the Building and the Exterior Common Areas; (viii) the following taxes; (A) personal property taxes (attributable to the year in which paid) imposed upon the furniture, fixtures, machinery, equipment, apparatus, systems, and appurtenances used in connection with the Building for the operation thereof, and (B) real estate taxes, assessments, sewer rents, rates, and charges, transit taxes, taxes based upon the receipt of rent and any other federal, state, or local governmental charge, general, special, ordinary, or extraordinary (but not including income or franchise taxes or any other taxes imposed upon or measured by Landlord’s income or profits, unless the same shall be imposed in lieu of real estate taxes) which may now or hereafter be levied or assessed against the Building and/or the Property or the rents derived from the Building (in the case of special taxes or assessments which may be payable in installments, only the amount of each installment paid during the calendar year shall be included in the taxes for that year); (ix) costs for the maintenance and repair of the Building and the personal property used in connection therewith (excluding repairs and maintenance costs which are paid from proceeds of insurance of which are paid by, Tenant or other third parties, and alterations attributable solely to tenants of the Building other than Tenant); (x) amortization of the cost of installation of capital investment items which are primarily for the purpose of reducing operating costs or which may be required by applicable laws effective on or after the Commencement Date, and all such capital improvements shall be amortized by Landlord over the useful life thereof, with interest at 8% per annum on the amount unamortized from time to time; (xi) advertising and leasing fees; and (xii) legal and accounting expenses, including, but not limited to, such expenses as related to seeking or obtaining reductions in and/or refunds of real estate taxes; and (xiii) commercially reasonable management fees. Notwithstanding the foregoing, the following costs shall be excluded from the definition of Basic Costs:

1. Costs for which Landlord receives reimbursement from others (including reimbursement from insurance) as a payment other than for Basic Costs,

2. Interest, charges and fees incurred on debt or payments on any deed of trust or ground lease on the Premises of which Landlord is debtor, trustor, or lessee;

3. Costs incurred in repairing, maintaining or replacing any structural elements of the Building for which Landlord is responsible pursuant to Paragraph 13(a) hereof;

4. Expense reserves;

5. Costs in the nature of depreciation and amortization,

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6. Accounting costs, except those incurred in connection with the accounting of Basic Costs;

7. Costs incurred as a result of casualties to the extent reimbursed or reimbursed by the insurance required to be carried by Landlord hereunder

8. Costs incurred as a result of the exercise of the power of eminent domain;

9. Earthquake or terrorism insurance deductibles, except to the extent used for repair or reconstruction and the costs amortized over the useful life of the repaired or reconstructed improvements so damaged;

10. Costs of a capital nature, including but not limited to capital improvements and alterations, capital repairs, capital equipment, and capital tools as determined in accordance with generally accepted accounting principles, excepting only capital expenditures for improvements or changes to the Building, which are required by laws, ordinances, or other governmental regulations effective after the Commencement Date, and capital expenditures which have the effect of reducing Operating Expenses, to the extent the cost of all such capital improvements are amortized over the useful life of said improvements, pursuant to Paragraph 4(b); to the extent permitted under this Lease, capital costs shall be amortized over their useful life.

11. Real estate brokerage and leasing commissions and other leasing costs, attorneys’ fees, costs, disbursements, and other expenses incurred in connection leasing, renovating, or improving space for prospective tenants or other occupants of the premises in the Building;

12. Advertising and marketing expenses, including the cost of any tenant parties paid by Landlord;

13. Costs with respect to the creation of a mortgage or a superior lease or in connection with a sale of the Building;

14. Landlord’s or Landlord’s property manager’s corporate general overhead or corporate general administrative expenses;

15. overhead profit increments paid to Landlord’s subsidiaries or affiliates for management or other services on or to the building or for supplies or other materials to the extent that the cost of the services, supplies, or materials materially exceeds the cost that would have been paid had the services, supplies, or materials been provided by unaffiliated parties on a competitive basis;

16. any compensation paid to clerks, attendants, or other persons in commercial concessions operated by Landlord;

17. any costs, fines, or penalties incurred due to late payment, negligence or willful misconduct on the part of Landlord, its agents, employees or contractors, or due to violations by Landlord of any governmental rule or authority, including without limitation, the cost of correcting any building code or other violations which were violations prior to the Commencement Date of this Lease;

18. the cost of containing, removing, or otherwise remediating any contamination or Hazardous Substances of the Building (including the underlying land and ground water) by any toxic or hazardous materials (including, without limitation, asbestos and “PCB’s”) where such contamination was not caused by Tenant;

19. wages, salaries, or other compensation paid to any executive employees above the grade of senior building or project manager; and

20. any other expense that under generally accepted accounting principles and practices, or the guidelines published by groups such as the building owners and manager’s association, would not be considered a normal maintenance or operating expense.

(l) The Basic Costs of the Building shall be computed on the accrual basis and shall be all Basic Costs incurred by Landlord to maintain all facilities of the Building and the Exterior Common Areas in operation during all or part of the year. If less than ninety-five percent (95%) of the Rentable Area of the Building shall have been occupied by tenants at any time during any calendar year of the Lease Term, the Basic Costs for such calendar year shall be deemed to be an amount equal to the Basic Costs which would normally be expected to have been incurred had such occupancy been ninety-five percent (95%) throughout such calendar year.

(m) “Building Standard Improvements” when used herein, means those Improvements to the Premises described as such in Exhibit “B”.

3. Lease Grant. Subject to and upon the terms herein set forth, Landlord leases to Tenant and Tenant leases from Landlord the Premises for the Lease Term. Tenant is hereby granted only a usufruct, not subject to levy or sale; neither an estate for years nor other estate shall pass from the Landlord on account thereof. The Rentable Area

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of the Premises is stipulated for all purposes to be the number of square feet set forth in the Lease summary in Paragraph 1.

4. Lease Term.

(a) The “Lease Term” is for a period of time commencing at 12:01 a.m. on the Commencement Date, or on such later date as is provided in subparagraph (c) below, and continuing thereafter through and until 6:00 p.m. on the last day of the month in which the Expiration Date occurs.

(b) If on the Commencement Date the Premises have not been substantially completed due to omission, delay or default by Tenant or anyone acting under or for the Tenant (including, without limitation, Tenant’s default or failure to perform its obligations in a timely manner or any delay resulting from changes to the “Drawings and Specifications” by Tenant ) then Tenant’s obligations under this Lease (including, without limitation, the obligation to pay rent) shall nonetheless commence as of the Commencement Date.

(c) If, due to causes other than as set forth in subparagraph (b) above, Landlord does not deliver possession of the Premises to Tenant on the Commencement Date with the Improvements described in Paragraph 2 of Exhibit B substantially completed, this Lease shall not be void or voidable, nor shall Landlord be liable to Tenant for any loss or damage resulting therefrom, but in that event rent shall abate until the date when Landlord does deliver possession in accordance with the terms and requirements of this Lease, and the Lease Term shall commence on the date when possession is delivered to Tenant, and in such event the Expiration Date shall occur on the last day of the month that is five (5) years following the date on which the Commencement Date actually occurs. Notwithstanding the foregoing, however, in the event that Landlord does not deliver possession of the Premises to Tenant, with the Improvements described in Paragraph 2 of Exhibit B hereof substantially completed, within one hundred fifty (150) days after the date this Lease has been executed by Landlord and Tenant, then Tenant may, at its option, by written notice to Landlord not later than five (5) business days after the expiration of such one hundred fifty (150) day period, cancel this Lease, in which event Landlord and Tenant shall each be discharged from their obligations hereunder. Such one hundred fifty (150) day period shall be extended on a day for day basis, however, for any delays caused by Tenant including, without limitation, any delays caused by any changes to the work described in Paragraph 2 of Exhibit B which are caused by Tenant, or any delays caused by Tenant’s early entry under the terms of subparagraph (e) hereof.

(d) In the event that Landlord cannot deliver possession of the Premises to Tenant on the Commencement Date because of Tenant’s failure to perform its obligations under, or to pay the amounts specified, this Lease shall be terminable at the sole option of Landlord at any time after the Commencement Date and prior to Tenant’s performance or payment; and should Landlord so elect to terminate this Lease, such termination shall be without prejudice to Landlord’s right to sue Tenant to recover damages for Tenant’s failure to perform its obligations, or to pay amounts due.

(e) Landlord shall permit Tenant to enter the Premises at least two (2) weeks prior to the Commencement Date for the purpose of installing Tenant’s systems furniture and low voltage wiring. Tenant’s entry shall be subject to each of the terms and conditions of this Lease except Tenant’s obligation to pay Base Rental and Basic Costs shall not commence until the Commencement Date. Any installations made by Tenant during such period shall be at Tenant’s risk, and Landlord shall not be liable for any loss or damage thereto. Tenant’s entry shall not be permitted to interfere with or delay Landlord’s construction of the Improvements.

5. Base Rental.

(a) Tenant shall pay to Landlord as annual rental during the term of this Lease the Base Rental, payable in lawful money of the United States, in advance, in monthly equal installments on or before the first day of each month during the Lease Term. The Base Rental is subject to increase as provided hereinbelow. If this Lease commences on a day other than the first day of the calendar month, the monthly installment of Base Rental for the fractional month shall be appropriately prorated on a daily basis for such month. Tenant has paid Landlord the amount of Prepaid Rental set forth in set forth in the Lease summary in Paragraph 1 upon Tenant’s execution of this Lease, representing the monthly installment of Base Rental for the fourth (4^th) month following the Commencement Date.

(b) Tenant shall pay to Landlord all Base Rental, additional rent, and all other charges due and owing by Tenant under this Lease with deduction or set-off, in legal tender, and at Landlord’s address or as otherwise directed from time to time by Landlord’s notice.

6. Additional Rent.

(a) Tenant’s Base Rental is based, in part, upon the estimate that annual Basic Costs will be equal to the $6.75 per square foot of Rentable Area of the Building at full occupancy as determined below. “Base Year” shall be defined as the actual “Basic Costs” paid or incurred during the calendar year 2006. In the event the building is less than ninety-five percent (95%) occupied, the variable costs shall be adjusted by the Landlord to reflect ninety-five percent (95%) occupancy). The Rentable Area of the Building is stipulated to be as set forth in the Lease summary in Paragraph 1. Tenant shall, from time to time during the term of the Lease, pay as additional rent hereunder an amount

8

equal to the product obtained by multiplying (i)the excess in actual Basic Costs over the Base Year times (ii) the number of square feet of the Rentable Area of the Premises (the “Excess”).

(b) Landlord shall also have the right, prior to after the close of any calendar year, to make a good faith estimate of the Excess for the succeeding calendar year and, following thirty (30) days’ notice to Tenant, Tenant shall pay to Landlord, on or before the first day of each month of such calendar year, one-twelfth (1/12th) of such estimated Excess; provided, however, that prior to receipt of such notice, Tenant shall continue to pay Landlord the monthly installment amount of the Excess, if any, which was paid or payable in the calendar year just ended.

(c) By April 1 of each calendar year following the year during which the Lease Term begins, or as soon thereafter as practical, Landlord shall furnish to Tenant a statement of Landlord’s actual Basic Costs for the previous calendar year, and Landlord shall notify Tenant of the actual amount of the Excess owing by Tenant to Landlord, which statement shall show the calculations used to derive the amount of the Excess. Tenant agrees to pay Landlord promptly, with the next monthly rental payment, as additional rent, all Excess which has not been previously paid as estimated Excess. If for any calendar year additional rent collected for the prior year, as a result of Landlord’s estimate of Excess, is greater than the additional rent actually due during such prior year, then Landlord shall refund to Tenant any such overpayment or, at Landlord’s option, apply such amount against rentals thereafter coming due under the Lease.

1. Every statement given by Landlord pursuant to paragraph (c) of this Paragraph 6 shall be conclusive and binding upon Tenant unless within 90 days after the receipt of such statement (the “Dispute and Audit Period”) Tenant shall notify Landlord (a “Dispute Notice”) that it disputes the correctness thereof, specifying, subject to Tenant’s audit rights set forth below, the particular respects in which the statement is claimed to be incorrect. Following Landlord’s receipt of a Dispute Notice, Landlord and Tenant shall have a period of forty-five (45) days in which to discuss the matters raised in such Dispute Notice and reach agreement on a resolution thereof. Pending the determination of such dispute by agreement or arbitration as aforesaid, Tenant shall, within ten (10) days after receipt of such statement, pay the amounts due in accordance with Landlord’s statement and such payment shall be without prejudice to Tenant’s position. If the dispute shall be determined in Tenant’s favor, Landlord shall within thirty (30) days after final resolution of the dispute pay Tenant the amount of Tenant’s overpayment of such amounts resulting from compliance with Landlord’s statement.

2. Provided Tenant notifies Landlord in accordance with the terms of paragraph 1. above that Tenant disputes a statement received from Landlord, Tenant or its CPA (as defined below) shall have the right, at Tenant’s sole cost and expense, provided Tenant utilizes a Certified Public Accountant (the “CPA”) compensated solely on an hourly basis, upon at least thirty (30) days prior notice to Landlord at any time during regular business hours to audit, review and photocopy Landlord’s records pertaining to Basic Costs for the immediately previous calendar year only. Tenant shall complete the audit and present any disputed charges to Landlord, in writing, within the Dispute and Audit Period. If, following Landlord’s receipt of the audit and any disputed charges (the “Report Date”), Landlord disputes the findings contained therein, and Landlord and Tenant are not able to resolve their differences within thirty (30) days following the Report Date, the dispute shall be resolved by binding arbitration as follows: Landlord and Tenant shall each designate an independent certified public accountant, which shall in turn jointly select a third independent Certified Public Accountant (the “Third CPA”). The Third CPA, within thirty (30) days of selection, shall, at Tenant’s sole expense, audit the relevant records and certify the proper amount within. That certification shall be final and conclusive. If the Third CPA determines that the amount of the Excess billed to Tenant was incorrect, the appropriate party shall pay to the other party the deficiency or overpayment, as applicable, within thirty (30) days following delivery of the Third Party CPA’s decision, without interest. Tenant agrees to keep all information thereby obtained by Tenant confidential and to obtain the agreement of its CPA and Third CPA to keep all such information confidential. Tenant shall provide a copy of such CPA agreements to Landlord promptly upon request.

7. Late Payments. Tenant shall pay, as a late charge in the event any installment of Base Rental, additional rent, or other charge to be paid by Tenant hereunder is not paid when due, an amount equal to five percent (5%) of the amount due for each and every 30-day period that said amount remains unpaid (but in no event shall the amount of such late charge exceed an amount based upon the highest legally permissible rate chargeable at any time by Landlord under the circumstances). Should Tenant make a partial payment of past due amounts, the amount of such partial payment shall be applied first to reduce all accrued and unpaid late charges, in inverse order of their maturity, and then to reduce all other past due amounts, in inverse order of their maturity. In the event that Landlord imposes a late charge, it shall provide written notification thereof within thirty (30) days following the imposition of such charge. Landlord shall, before imposing the late charge, give Tenant written notice and a period of five (5) business days to cure two (2) times in each calendar year.

8. Occupancy and Use.

(a) Tenant shall use and occupy the Premises for general office purposes and for no other use or purpose without prior written consent of Landlord.

(b) Tenant shall not do or permit anything to be done in or about the Premises which will in any way obstruct or interfere with the rights of other tenants or occupants of the Building or injure or annoy

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them. Tenant shall not use the Premises or allow the Premises to be used for any improper, immoral, unlawful, or objectionable purposes, or for any business, use or purpose which is, in Landlord’s sole but reasonable judgment, disreputable or inconsistent with the operation of a first class office building, nor shall Tenant cause or maintain or permit any nuisance in, on, or about the Premises.

9. Hazardous Substances. Tenant shall not use or permit the use of the Premises for the storage, treatment, use, production or disposal of any hazardous substances or hazardous waste (as those terms are defined under CERCLA or RCRA or any other applicable federal, state or local environmental protection laws), herein “Hazardous Substances.” Notwithstanding the foregoing, Tenant may maintain reasonable quantities of standard office and cleaning supplies in the Premises, for its own use within the Premises, in a manner compliant with all applicable law and regulation. Tenant shall promptly notify Landlord of its receipt of any notice of a violation of any such law, standard or regulation. The use, generation, storage, release, threatened release, discharge, disposal or presence on or about the Premises of any Hazardous Substances by Tenant, Tenant’s agents or any sublessee or assignee occupying all or part of the Premises shall be an immediate event of default under this Lease. Tenant does hereby indemnify and hold Landlord harmless from and against any and all damage to any property, penalties, expenses, claims, losses or liabilities or injury to or death of any person as a result of Tenant’s violation of the foregoing provision. Tenant’s indemnity shall include the obligation to reimburse Landlord for any and all costs and expenses (including reasonable attorneys’ fees) incurred by Landlord, its agents or employees as a result of Tenant’s violation. This Paragraph 9 does not impose upon Tenant liability for any Hazardous Substances in the Building or the Premises not introduced by, through or under Tenant.

10. Compliance with Laws. Tenant shall, at Tenant’s sole expense, (i) comply with all laws, orders, ordinances, and regulations of federal, state, county, and municipal authorities having jurisdiction over the Premises, including, without limitation, the Americans With Disabilities Act, (ii) comply with any directive, order or citation made pursuant to law by any public officer requiring abatement of any nuisance or which imposes upon Landlord or Tenant any duty or obligation arising from Tenant’s occupancy or use of the Premises or from conditions which have been created by or at the request or insistence of Tenant, or required by reason of a breach of any of Tenant’s obligations hereunder or by or through other fault of Tenant, (iii) comply with all insurance requirements applicable to the Premises and (iv) indemnify and hold Landlord harmless from any loss, cost, claim or expense which Landlord incurs or suffers by reason of Tenant’s failure to comply with its obligations under clauses (i), (ii) or (iii) above. If Tenant receives notice of any such directive, order citation or of any violation of any law, order, ordinance, regulation or any insurance requirement, Tenant shall promptly notify Landlord in writing of such alleged violation and furnish Landlord with a copy of such notice.

11. Service and Utilities.

(a) Landlord shall maintain the Service Areas and Common Areas of the Building, the mechanical, plumbing and electrical equipment serving the Building, and the structure itself, in reasonably good order and condition except for damage occasioned by the act or negligence of Tenant, which damage shall be repaired by Landlord at Tenant’s expense. In the event Tenant requires or needs to have one or more separate systems of either heating, ventilating, air-conditioning or other similar systems over and above that provided by Landlord, the installation, care, expense, and maintenance of each such system shall be borne by and paid for by Tenant.

(b) Provided the Tenant shall not be in default hereunder, and subject to the provisions elsewhere herein contained and the rules and regulations of the Building, Landlord agrees to furnish to the Premises during ordinary business hours (7 a.m.–6 p.m. M-F; 8 a.m.–1 p.m., Sat.) of generally recognized business days, to be determined by Landlord (but exclusive, in any event, of Sundays and legal holidays: (i) heat and air-conditioning required in Landlord’s judgment for the comfortable use and occupation of the Premises; (ii) janitorial services during the times and in the manner that such services are, in Landlord’s judgment, customarily furnished in comparable office buildings in the immediate market area, five days per week (except fewer days if the Building is closed due to a recognized holiday) except that, if Tenant’s floor covering or other improvements require special treatment, Tenant shall pay the additional cleaning cost attributable thereto as additional rent upon presentation of a statement therefor by Landlord; (iii) elevator service; (iv) electricity; and (v) water for drinking and lavatory purposes. Landlord will furnish HVAC service to the Premises outside of ordinary business hours in accordance with the prior notifications procedures then generally in place for the Building at Landlord’s then generally applicable after hours rate which is, as of the date hereof $45.00 per hours.

(c) Tenant will not without the written consent of Landlord use any apparatus or device in the Premises, including without limitation, electronic data processing machines and machines using excess lighting or current which will in any way increase the amount of electricity or water usually furnished or supplied for use of the Premises as general office space; nor connect with electric current, except through existing electrical outlets in the Premises, or with water pipes, any apparatus or devise for the purpose of using electrical current or water. If Tenant in Landlord’s judgment shall require water or electric current or any other resource in excess of that usually furnished or supplied for use of the Premises as general office space (it being understood that such an excess may result from the number of fixtures, apparatus and devices, the hours of use, or any combination of such factors), Tenant shall first procure the consent of Landlord, which Landlord may in its discretion withhold, to the use thereof, and Landlord may cause a special meter to be installed in the Premises, at Tenant’s expense, so as to measure the amount of water, electric current or other resource so consumed, as shown by said meters, at the rates charged by the local

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public utility furnishing the same, plus any additional expense incurred in keeping account of the water, electric current or other resources so consumed.

(d) Landlord shall not be liable to Tenant or to any person, firm, corporation, or other business association claiming by, through or under Tenant for :(i) failure to furnish or for delay in furnishing any service provided for in this Lease, and no such failure or delay by Landlord shall be an actual or constructive eviction of Tenant nor shall any such failure or delay operate to relieve Tenant from the prompt and punctual performance of each and all of the covenants to be performed hereunder by Tenant; (ii) any latent defects in the Premises or Building; (iii) defects in the cooling, heating, electric, water, elevator, or other apparatus or systems or for water discharged from sprinkler systems, if any, in the Building; (iv) the limitation, curtailment, rationing or restricting of use of water or electricity, gas or any other form of energy or any other service or utility whatsoever serving the Premises or the Building; (v) for Landlord’s reasonable voluntary cooperation with the efforts of national, state or local government agencies or utilities suppliers in reducing energy or other resource consumption. The foregoing does not, however, exculpate Landlord from its gross negligence, willful misconduct, or breach of its express obligations under this Lease.

(e) Any sums payable under this Paragraph 11 shall be considered additional rent and shall be added to any installment of Base Rental thereafter becoming due, and Landlord shall have the same remedies for payment of such sums as for a default in the payment of Base Rental.

(f) Tenant shall not provide any janitorial services without Landlord’s written consent and then only subject to supervision of Landlord and by a janitorial contractor or employees at all times satisfactory to Landlord. Any such services provided by Tenant shall be Tenant’s sole responsibility and at Tenant’s sole risk.

(g) Access to the Building may be regulated during other than normal business hours in such manner as Landlord deems appropriate. Landlord, however, shall have no liability to Tenant, its employees, agents, invitees or licensees for losses due to theft or burglary, or for damages or injuries done by unauthorized persons on the Premises or in the Building and neither shall Landlord be required to insure against such losses. Tenant shall cooperate fully in Landlord’s efforts to regulate access to the Building. Landlord has installed a card key access system for the Building and related parking deck. Landlord shall not unreasonably withhold its consent to Tenant’s proposed plans and specifications to install its own security card-key access system for the Premises and to connect such system through the Building’s system provided, however, that any such work shall be at Tenant’s sole cost and expense and shall not in any respect be permitted to impair the utility of the system that services the Building outside of the Premises.

12. Improvements on Premises. All installations and improvements now or hereafter placed on the Premises other than Building Standard Improvements shall be made by Landlord at Tenant’s election, for Tenant’s account and at Tenant’s cost (and Tenant shall pay ad valorem taxes and increased insurance thereon or attributable thereto), which cost shall be payable by Tenant to Landlord in advance as additional rent.

13. Graphics. Landlord shall provide and install, at Tenant’s cost, all letters and numerals on doors in the Premises, all such letters and numerals shall be in the standard graphics chosen by Landlord for the Building and no others shall be used or permitted on the Premises without Landlord’s prior written consent.

14. Care of Premises. Tenant agrees not to commit any waste or allow any waste to be committed on any portion of the Premises, and at the termination of this Lease to deliver up to the Premises to Landlord in as good condition as at the Commencement Date, ordinary wear and tear and damage by casualty and such items that are Landlord’s responsibility under this Lease excepted.

15. Alterations. Tenant shall not make or suffer to be made any alterations, additions, or improvements in, on, or to the Premises or any part thereof, without the prior written consent of Landlord; and any such alterations, additions, or improvements in, on, or to said Premises, except for Tenant’s movable furniture and equipment, shall immediately become Landlord’s property and, at the end of the term hereof, shall remain on the Premises without compensation to Tenant. In the event Landlord consents to the making of any such alterations, additions, or improvements by Tenant, the same shall be made by Tenant, at Tenant’s sole cost and expense, in accordance with all applicable laws, ordinances, and regulations and all requirements of Landlord’s and Tenant’s insurance policies, and in accordance with plans and specifications approved in writing by Landlord, and any contractor or person selected by Tenant to make the same, and all subcontractors must first be approved in writing by Landlord.

16. Repair. By taking possession of the Premises, Tenant accepts the Premises as being in the condition in which Landlord is obligated to deliver them and otherwise in good order, condition and repair. Tenant shall at all times during the term hereof, at Tenant’s sole cost and expense, keep the Premises and every part thereof in good order, condition and repair, excepting ordinary wear and tear, damage thereto by fire, earthquake, act of God or the elements, and such matters that are Landlord’s responsibility under this Lease. Should Tenant fail to make any repairs or replacements required of it hereunder promptly, Landlord may at its option make such repairs and replacements and Tenant shall pay the cost thereof to Landlord as additional rent.

17. Parking. During the Lease Term, Tenant shall have the nonexclusive use in common with Landlord, other tenants of the Building, their guests and invitees, of the non-reserved common automobile parking areas not to exceed the number of parking spaces set forth in the Lease summary in Paragraph 1, driveways, and footways

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located on the Property, subject to such rules and regulations for the use thereof as may be prescribed from time to time by Landlord. The cost of such parking is included in the Base Rental.

18. Re-Entry by Landlord. Landlord reserves and shall at all times have the right to re-enter the Premises to inspect the same, to supply janitorial service and any other service to be provided by Landlord to Tenant hereunder, and upon reasonable prior notification to show the Premises to prospective purchasers, mortgagees or tenants, to post notices of non-responsibility, and to alter, improve, or repair the Premises and any portion of the Building of which the Premises are a part or to which access is conveniently made through the Premises, without abatement of rent, and may for that purpose erect, use, and maintain scaffolding, pipes, conduits, and other necessary structures and equipment in and through the Premises where reasonably required by the character of the work to be performed, provided that entrance to the Premises shall not be blocked thereby, and further provided that the business of Tenant shall not be interfered with unreasonably. Tenant hereby waives any claim for damages for any injury or inconvenience to or interference with Tenant’s business, any loss of occupancy or quiet enjoyment of the Premises, and any other loss occasioned thereby. For each of the aforesaid purposes, Landlord shall at all times have and retain a key with which to unlock all of the doors in, upon, and about the Premises, and Landlord shall have the right to use any and all means which Landlord may deem necessary or proper to open said doors in an emergency, in order to obtain entry to any portion of the Premises, and any entry to the Premises, or portions thereof obtained by Landlord by any of said means, or otherwise, shall not under any circumstances be construed or deemed to be a forcible or unlawful entry into, or a detainer of the Premises, or an eviction, actual or constructive, of Tenant from the Premises or any portions thereof; Landlord shall also have the right at any time, without the same constituting an actual or constructive eviction and without incurring any liability to Tenant therefor, to change the arrangement and/or location of entrances or passageways, doors and doorways, and corridors, elevator, stairs, toilets, or other public parts of the Building and to change the name, number of designation by which the Building is commonly known. Landlord acknowledges that Tenant’s server area and other portions of the Premises may be subject to security procedures established by Tenant, and Landlord agrees to cooperate with reasonable requirements of Tenant, such as prior notice and the requirement that an employee of Tenant accompany Landlord, except, however, that any such restrictions shall not be applicable in emergencies.

19. Assignment and Subletting.

(a) Tenant shall not, without the prior written consent of Landlord, (i) sell, assign, convey, mortgage, pledge, encumber or otherwise transfer this Lease or any interest herein (whether voluntarily, by operation of law, or otherwise), (ii) sublet the Premises or any portion thereof, or (iii) permit any one other than Tenant to occupy or use the Premises or any portion thereof; and any attempt to consummate any of the foregoing without Landlord’s written consent shall be void. Landlord shall not unreasonably withhold its consent to such assignment or sublease if Tenant submits reasonable evidence to demonstrate that the proposed subtenant or assignee has the financial capacity to perform under the subject sublease or assignment, that it’s use and character are reasonably suitable for the Building, that it is not barred by any then applicable use restriction, and that it is not a current tenant of the Building or a party with whom Landlord has dealt with in the previous three (3) month period to lease premises in the Building; the foregoing restriction on Tenant’s dealing with Landlord’s current or prospective tenants shall not be applicable, however, if Landlord does not have premises of sufficient square footage available in the Building to accommodate the space requirements of Tenant’s prospective subtenant or assignee. Notwithstanding the foregoing requirement of Landlord’s consent, Tenant may assign its right, title and interest under this Lease to any Affiliate (as hereinafter defined) without the consent of Landlord. For the purposes of this Section 19(a), “Affiliate” shall mean any person or entity that controls, is controlled by or is under common control with Tenant. An entity shall be presumed to have control when it possesses the power, directly or indirectly, to direct, or cause the direction of, the management or policies of Tenant, whether through ownership of voting securities, or otherwise. In the event of any assignment to an Affiliate, Landlord shall be given written notice thereof, together with a reasonable description of how such party qualifies as an Affiliate and evidence that such Affiliate has obtained the insurance required to be maintained by Tenant hereunder. In addition, notwithstanding anything herein to the contrary, Tenant shall be permitted to assign this Lease to any entity which acquires all of Tenant’s assets and liabilities or with which Tenant is merged or consolidated, subject to Tenant’s obligation to give Landlord written notice of such transaction together with evidence of the successor entity’s insurance required under this Lease.

(b) If at any time during the term of this Lease Tenant desires to sublet all or part of the Premises or to assign this Lease, Tenant shall submit such request to Landlord in writing, together with a copy of the proposed assignment or sublease and such additional information concerning the proposed assignee or sublessee as may be requested by Landlord for Landlord’s review. If Landlord, in its discretion, approves in writing the terms of the proposed assignment or sublease and the proposed assignee or sublessee, but a fully executed counterpart of such assignment or sublease is not delivered to Landlord within thirty (30) calendar days after the date of Landlord’s written approval, then Landlord’s approval of the proposed assignment or sublease shall be automatically withdrawn and shall be deemed null and void. As a condition to Landlord’s prior written consent as provided for in this Paragraph 19, the assignee or subtenant shall agree in writing to comply with and be bound by all of the terms, covenants, conditions, provisions and agreements of this Lease, and Tenant shall deliver to Landlord promptly after execution an executed copy of said sublease or assignment and an agreement of said compliance by each sublessee or assignee, Landlord’s consent to any assignment or subletting shall not release Tenant from any of Tenant’s obligations hereunder or be deemed to be a consent to any other or subsequent assignment or subletting. Tenant agrees to pay to Landlord, on demand, reasonable costs incurred by Landlord

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in connection with any request by Tenant for Landlord to consent to any assignment or subletting by Tenant. Tenant shall not sublease any portion of the Premises to another tenant in the Building.

(c) Notwithstanding the giving by Landlord of its consent to any assignment or sublease with respect to the Premises, no assignee or sublessee may exercise any expansion option, right of first refusal option, or renewal option under this Lease except in accordance with a separate written agreement entered into directly between such assignee or sublessee and Landlord.

(d) Any transfer after the date hereof, whether to one or more persons or entitles and whether at one or more different times, of a controlling interest in Tenant (whether Tenant is a corporation, partnership, or other entity), whether voluntarily, by operation of law, or otherwise, shall be deemed an assignment of this Lease within the meaning of this Paragraph 19.

(e) If, with the consent of the Landlord, this Lease or any interest therein is assigned or the Premises or any part thereof is sublet or occupied by anybody other than Tenant, Landlord may, after default by Tenant, collect rent from the assignee, subtenant or occupant, and apply the net amount collected to the Base Rental and additional rent herein reserved, but no such assignment, subletting, occupancy, or collection shall be deemed (i) a waiver of any of Tenant’s covenants contained in this Lease, the acceptance by Landlord of the assignee, subtenant, or occupant as Tenant, or (ii) a release of Tenant from further performance by Tenant of its covenants under this Lease.

(f) If this Lease is assigned or the Premises or any part thereof is sublet or occupied by anyone other than Tenant, then Tenant shall pay to Landlord, in addition to any other amounts owing hereunder, all compensation received by Tenant from such assignee or subtenant with respect to such assignment or subletting, over and above the amount of Base Rental, additional rent or other sums owing under this Lease, whether such additional compensation to Tenant is in the form of a lump sum payment, monthly payment or otherwise; such additional compensation or any installment thereof shall be payable by Tenant to Landlord as and when received by Tenant, and Tenant hereby assigns all rights it might have or ever acquire in any such additional compensation to Landlord.

20. Discharge of Liens. Tenant shall discharge of record by bond or otherwise within ten (10) days following the filing thereof any mechanic’s or similar lien filed against the Premises, the Building or the Property for work or materials claimed to have been furnished to or for the benefit of Tenant and/or the Premises; provided, however, that Tenant shall have no responsibility with respect to any mechanic’s or similar lien filed against the Premises or the Building for work or materials furnished by or at Landlord’s request, if Tenant is current in the payment of all obligations owed Landlord. If Tenant shall fail to cause such lien or claim of lien to be so discharged or bonded within such period, in addition to any other right or remedy it may have, Landlord may, but shall not be obligated to, discharge the same by paying the amount claimed to be due or by procuring the discharge of such lien or claim by deposit in court or bonding, and in any such event, Landlord shall be entitled, if Landlord so elects, to compel the prosecution of any action for the foreclosure of such lien or claim by the lienor or claimant and to pay the amount of the judgment, if any, in favor of the lienor, with interest, costs, and allowances. Tenant shall pay as additional rent on demand from time to time any sum or sums so paid by Landlord, including, but not limited to, attorneys’ fees in processing such discharge or in defending any such action.

21. Insurance.

1. “Special Form” property insurance insuring the Leasehold Improvements, Tenant’s interest in the Premises and all property located in the Premises, including furniture, equipment, fittings, installations, fixtures, supplies, property in the course of construction, repair, or alteration and any other personal property, leasehold improvements and alterations (“Tenant’s Property”), in an amount equal to the full replacement value. It is understood that no lack or inadequacy of insurance by Tenant shall in any event make Landlord subject to any claim by virtue of any theft of or loss or damage to any uninsured or inadequately insured property;

2. Business Interruption insurance on a “Special Form” policy in an amount necessary to cover the clients loss of income, continuing expenses, and extra expenses during period of interruption or attributable to the prevention of access to the Premises by civil authority; and sufficient to reimburse Tenant for Rent in the event of a casualty to, or temporary taking of, the Building or the Premises;

3. Commercial general liability insurance written on an occurrence basis including personal injury, bodily injury, broad form property damage, operations hazard, , contractual liability, with a cross liability clause and a severability of interests clause to cover Tenant’s indemnities set forth herein, and products and completed operations liability, in limits not less than $1,000,000.00 inclusive per occurrence and $2,000,000 annual aggregate, Said policy to contain no special exclusions for construction or sub-contractors work. Limits required beyond $1 Million may be satisfied with an excess liability policy.

4. Worker’s Compensation and Employer’s Liability insurance, with a waiver of subrogation endorsement, in form and amount as required by applicable law. Employers Liability limits sufficient to be covered by umbrella;

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5. Auto Liability or Hired/Non-owned auto liability if no owned autos for $1,000,000;

6. Damage to property you rent coverage in the amount of $1,0000,000; and

7. Excess Liability/Umbrella Policy providing at least $5,000,000 liability coverage in excess of those limits for coverages stated above.

8. Any other form or forms of insurance or any changes or endorsements to the insurance required herein as may reasonably be required by Landlord, or any mortgagee or lessor of Landlord may reasonably require, from time to time, but in no event will Landlord require coverages or amounts more that typically required by landlords of typical buildings in the Duluth, Georgia market.

9. Tenant shall have the right to include the insurance required by Paragraph 21(a) (1)-(7) under Tenant’s policies of “blanket insurance.” All liability insurance policies of insurance or certificates thereof shall include Landlord, Landlord’s manager, and all mortgagees and lessors of Landlord shall (which mortgagee is, as of the date hereof, Massachusetts Mutual Life Insurance Company, and Tenant shall receive written notice of any successor thereto before being required to name such successor), of which Tenant has been notified, additional insureds, all as their respective interest may appear. All such policies or certificates shall be issued by insurers admitted in the state of Georgia and have an A. M. Best rating of A-VII or better. Tenant shall deliver to Landlord certificates of insurance and evidence of property insurance annually by the Commencement Date. All policies of insurance shall be primary and non-contributory to insurance carried by Landlord. All such policies and certificates shall contain an agreement by the insurers that the Landlord and any mortgagee or lessor of Landlord shall be notified in writing, not less than forty-five (30) days before cancellation, including cancellation for nonpayment of premium, or other termination of coverage at this location if a master policy and shall include a clause or endorsement denying the insurer any rights or subrogation against Landlord. Landlord shall not be liable to Tenant, and Tenant hereby waives all claims against Landlord, for any injury or damage to any person or property in or about the Premises or the Property by or from any cause whatsoever, including, without limitation, any such injury or damage caused or occasioned by or resulting from (i) water leakage of any charger from the roof, walls, basement or other portions of the Premises or the Building, (ii) gas, fire or explosion of the Premises or the Building, (iii) theft, mysterious disappearance, burglary, or loss of any property of Tenant whether from the Premises or any part of the Building, (iv) acts of or disturbances or interference by third persons, including other tenants, (v) acts or omissions to act, whether criminal, negligent, or otherwise, of independent contractors (including security guards and janitorial staff), other tenants, or third parties, (vi) acts of God, public enemy, injunction, riot, strike, vandalism, insurrection, war, casualty, court order, requisition, or order of governmental body or authority and (vii) any other cause beyond the control of Landlord. Further, Landlord shall not be liable for any damage or inconvenience which may arise through repair or alteration of any part of the Building, Exterior Common Areas, or Premises.

(b) Landlord shall insure the Building against damage for the full replacement cost with casualty and commercial general liability insurance, all in such amounts and with such deductible as Landlord reasonably deems appropriate. Notwithstanding any contribution by Tenant to the cost of insurance premiums, as provided hereinabove, Landlord shall not be required to carry insurance of any kind on Tenant’s Property, and Tenant hereby agrees that Tenant shall have no right to receive any proceeds from any insurance policies carried by Landlord.

(c) Tenant shall not knowingly conduct or permit to be conducted in the Premises any activity, or place any equipment in or about the Premises or the Building, which will invalidate the insurance coverage in effect or increase the rate of casualty insurance or other insurance on the Premises or the Building, and Tenant shall comply with all requirements and regulations of Landlord’s casualty and liability insurer. If any invalidation of coverage or increase in the rate of casualty insurance or other insurance occurs or is threatened by any insurance company due to any act or omission by Tenant, or its agents, employees, representatives, or contractors, such statement or threat shall be conclusive evidence that the increase in such rate is due to such act of Tenant or the contents or equipment in or about the Premises, and, as a result thereof, Tenant shall be liable for such increase and such amount shall be considered additional rent payable with the next monthly installment of Base Rent due under this Lease. In no event shall Tenant introduce or permit to be kept on the Premises or brought into the Building any dangerous, noxious, radioactive or explosive substance.

22. Waiver of Subrogation / Indemnity.

(d) Landlord and Tenant each hereby waive any right of subrogation and right of recovery or cause of action for injury or loss to the extent that such injury or loss is covered by fire, extended coverage,

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“Special Form” or similar policies covering real property or personal property (or which would have been covered if Landlord or Tenant was carrying the insurance required by this Lease). Said waivers shall be in addition to, and not in limitation or derogation or, any other waiver or release contained in this Lease. Written notice of the terms of the above mutual waivers shall be given to the insurance carriers of Landlord and Tenant and the parties’ insurance policies shall be properly endorsed, if necessary, to prevent the invalidation of said policies by reason of such waivers.

(e) Tenant hereby agrees to hold harmless and indemnify Landlord for any claims of bodily injury(including death) and/ or property damage to Tenant, Tenant’s officer’s, employees, contractors, sub-contractors, vendor’s, clients, or invitees unless such loss is due to the sole negligence of the Landlord or Landlord’s breach of the express provisions of this Lease.

23. Damage by Fire, Etc.

(a) If the Building or any portion thereof is damaged or destroyed by any casualty to the extent that, in Landlord’s reasonable judgment, (i) repair of such damage or destruction would not be economically feasible, or (ii) the damage or destruction to the Building cannot be repaired within two hundred seventy (270) days after the date of such damage or destruction, or if the proceeds from insurance remaining after any required payment to any mortgagee or lessor of Landlord are insufficient to repair such damage or destruction, Landlord shall have the right, at Landlord’s option, to terminate this Lease by giving Tenant notice of such termination, within sixty (60) days after the date of such damage or destruction.

(b) If the Premises or any portion thereof is damaged or destroyed by any casualty against which Tenant is required to be insured under Paragraph 21, and if, in Landlord’s reasonable opinion, the Premises cannot be rebuilt or made fit for Tenant’s purposes within one hundred eighty (180) days after the date of such damage or destruction, then either Landlord or Tenant shall have the right, at the option of either party, to terminate this Lease by giving the other written notice, within sixty (60) days after such damage or destruction. If the proceeds from the insurance Tenant is required to maintain pursuant to Paragraph 21 hereof (or the amount of proceeds which would have been available if Tenant was carrying such insurance) are insufficient to repair such damage or destruction, then Landlord shall have the right, at its option, to terminate this Lease by giving Tenant written notice, within sixty (60) days after such damage or destruction.

(c) In the event of partial destruction or damage to the Building or the Premises which is not subject to Paragraph 23(a) or 23(b) or which is subject to Paragraph 23(a) or 23(b) but the applicable party (or parties) does not elect to terminate the Lease, but which renders the Premises partially but not wholly untenantable, this Lease shall not terminate and Rent shall be abated in proportion to the area of the Premises which, in Landlord’s reasonable opinion, cannot be used or occupied by Tenant as a result of such casualty. Landlord shall in such event, within a reasonable time after the date of such destruction or damage, subject to force majeure (as defined in Paragraph 38) or to Tenant Delay and to the extent and availability of insurance proceeds, restore the Premises to as near the same condition as existed prior to such partial damage or destruction, provided that Tenant pays to Landlord Tenant’s insurance proceeds as required in Paragraph 15.5. In no event shall Rent abate or shall any termination occur if damage to or destruction of the Premises is the result of the gross negligence or willful act of Tenant, or Tenant’s agents, employees, representatives, contractors, successors, assigns, licensees or invitees.

(d) If the Building or the Premises or any material portion thereof is destroyed by fire or other causes at any time during the last year of the Term, then either Landlord or Tenant shall have the right, at the option of either party, to terminate this Lease effective as of the date of casualty by giving written notice to the other within sixty (60) days after the date of such destruction.

(e) Landlord shall have no liability to Tenant for inconvenience, loss of business, or annoyance arising from any repair of any portion of the Premises or the Building. If Landlord is required by this Lease or by any mortgagee or lessor of Landlord to repair or if Landlord undertakes to repair, Tenant shall pay to Landlord that amount of Tenant’s insurance proceeds (or the amount which would have been received by Tenant if Tenant was carrying the insurance required by this Lease) which insures such damage as a contribution towards such repair, and Landlord shall use reasonable efforts to have such repairs made promptly and in a manner which will not unnecessarily interfere with Tenant’s occupancy.

(f) In the event of termination of this Lease pursuant to Paragraphs 23(a), (23(b), or 23(d), then all rent shall be apportioned and paid to the date on which possession is relinquished or the date of such damage, whichever last occurs, and Tenant shall immediately vacate the Premises according to such notice of termination; provided, however, that those provisions of this Lease which are designated to cover matters of termination and the period thereafter shall survive the termination hereof.

24. Condemnation. If any substantial part of the Premises shall be taken for any public or quasi-public use under governmental law, ordinance or regulation, or by right of eminent domain, or by private purchase in lieu thereof (any of the foregoing being referred to as a “taking”), this Lease shall terminate when the physical taking shall occur in the same manner as if the date of such physical taking were the date originally fixed in this Lease for the expiration of the term hereof; provided, however, that in no event shall a partial taking of less than twenty percent (20%) of the Rentable Area of the Premises give rise to an option on Tenant’s part to terminate this Lease.

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In the event of a partial taking which does not result in this Lease being terminated, the Base Rental shall be adjusted in proportion to the percentage of the Rentable Area of the Premises so taken. In the event any such taking, in Landlord’s judgment, would prevent or materially interfere with the use of the Building or the Premises for the purpose for which it is then being used, or would render the Landlord’s continued use or leasing of the Building economically or physically unfeasible, Landlord shall have the right to terminate this Lease by written notice to Tenant. In the event of any termination of this Lease pursuant to this Paragraph 24, any Base Rental or additional rent pay by Tenant for any period following the date of such termination shall be refunded to Tenant. Tenant shall not share in the condemnation award or payment in lieu thereof or in any award for damages resulting from any such taking, the same being hereby assigned to Landlord by Tenant; provided, however, that Tenant may separately claim and receive from the condemning authority, if legally payable, compensation for Tenant’s removal and relocation costs and for Tenant’s loss of business and/or business interruption.

25. Events of Default. The following events shall be deemed to be events of default by Tenant under this Lease:

(a) Tenant shall fail to pay when due any sum of money becoming due to be paid to Landlord under this Lease, whether such sum be any installment of the Base Rental or additional rent hereunder, or any other payment or reimbursement to Landlord required herein, whether or not treated as additional rent hereunder, and such failure shall continue for a period of five (5) days from the date such payment was due; or

(b) Tenant shall fail to comply with any term, provision or covenant of this Lease, other than by failing to pay when or before due any sum of money becoming due to be paid to Landlord hereunder, and shall not cure such failure within thirty (30) days if Tenant has promptly commenced and continuously attempted to cure (but the cure period shall be not more than two (2) business days (but shorter to the extent required for emergencies or hazardous conditions) if the default involves a hazardous condition, Tenant’s failure to maintain insurance, or any emergency) after written notice thereof to Tenant; or

(c) Tenant shall vacate or abandon any substantial portion of the Premises, even though Tenant continues to pay the stipulated monthly rent provided, however, that it shall not be an event of default if Tenant vacates the Premises after first giving Landlord written notice of its intension to do so, along with written notice of a notice address separate from the Premises and if, after vacating the Premises, Tenant abides by each of its covenants and obligations under this Lease; or

(d) Tenant shall fail to vacate the Premises immediately upon termination of this Lease, by lapse of time or otherwise, or upon termination of Tenant’s right to possession; or

(e) Tenant’s interest in the Lease or the Premises shall be subjected to any attachment, levy, or sale pursuant to any order or decree entered against Tenant in any legal proceeding and such order or decree shall not be vacated within thirty (30) days after entry thereof; or

(f) A receiver shall be appointed to take possession of all or substantially all of the assets of Tenant, Tenant shall make an assignment for the benefit of creditors, or Tenant shall take or suffer any action under any insolvency, bankruptcy or reorganization act (it being expressly agreed that in no event shall this Lease be assigned or assignable by operation of law or by voluntary or involuntary bankruptcy proceedings or otherwise and in no event shall this Lease or any rights or privileges hereunder be an asset of Tenant under any bankruptcy, insolvency, or reorganization proceedings).

26. Landlord’s Remedies. Upon the occurrence of any events of defaults described in Paragraph 25 or elsewhere in this Lease, Landlord shall have the option to pursue any one or more of the following remedies without any notice or demand whatsoever:

(a) Landlord may, at its election, terminate this Lease or terminate Tenant’s right to possession only, without terminating the Lease.

(b) Upon any termination of this Lease or upon any termination of Tenant’s right to possession without termination of the Lease, Tenant shall surrender possession and vacate the Premises immediately, and deliver possession thereof to Landlord and Tenant hereby grants to Landlord full and free license to enter into and upon the Premises in such event with or without process of law (but only to the extent permitted under Georgia law) and to repossess the Premises and to expel or remove Tenant and any others who may be occupying or within the Premises and to remove any and all property therefrom, without being deemed in any manner guilty of trespass, eviction or forcible entry or detainer, and without incurring any liability for any damages resulting therefrom, whether in contract or tort or otherwise, Tenant hereby waiving any right to claim damage, whether in contract or tort or otherwise, for such re-entry and expulsion, and without relinquishing Landlord’s rights to rent or any other right given to Landlord hereunder or by operation of law.

(c) Upon termination of this Lease, Landlord shall be entitled to recover, on the date of termination, all Base Rental and additional rent hereunder and other sums due and payable by Tenant on the date of termination, plus the sum of (i) liquidated damages in an amount equal to the future Base Rental and additional rent hereunder, and other sums provided herein to be paid by Tenant for the remainder of the Lease Term, discounted to present value on the basis of interest calculated at 5 percent per annum, less any amounts actually realized by Landlord in reletting the Premises after taking into account all expenses and time necessary to obtain a replacement tenant or tenants,

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including, without limitation, broker’s commissions, recovery of the Premises, preparation for reletting and for reletting itself, if any; (ii) the unamortized cost of all work performed on the Premises by Landlord in preparing the Premises for occupancy by Tenant; and (iii) the cost of performing any other covenants which would have otherwise been performed by Tenant. Tenant expressly agrees that Landlord is under no obligation to find a replacement tenant or to accept any tenant offered by Tenant or to observe any instructions given by Tenant about such reletting upon termination and Tenant expressly waives and renounces any defenses it may have under Georgia law relating to mitigation of damages and expressly agrees and covenants that Landlord’s action or inaction with respect to the reletting of the Premises do not in any way constitute a failure to mitigate damages or any other diminution of any damages which Landlord is entitled to recover pursuant to this paragraph.

(d) Upon termination of Tenant’s right to possession without termination of the Lease, and to the full extent permitted under Georgia law: (i) Landlord may, at Landlord’s option, enter into the Premises, remove Tenant’s signs and other evidences of tenancy, and take and hold possession thereof as provided in subparagraph (b) above, without such entry and possession terminating the Lease or releasing Tenant, in whole or part, from any obligation including Tenant’s obligation to pay the Base Rental and additional rent hereunder for the full Lease Term. In such case, Tenant shall pay forthwith to Landlord, if Landlord so elects, a sum equal to the entire amount of the Base Rental and additional rent hereunder for the remainder of the Lease Term plus any other sums provided herein to be paid by Tenant for the remainder of the Lease Term; (ii) Landlord may, but need not, relet the Premises or any part thereof for such rent and upon such terms as Landlord in its sole discretion shall determine (including the right to relet the Premises for a greater or lesser term than that remaining under this Lease, the right to relet the Premises as a part of a larger area, and the right to change the character and use made of the Premises) and Landlord shall not be required to accept any tenant offered by Tenant or to observe any instructions given by Tenant about such reletting, provided that Landlord shall use commercially reasonable efforts to relet under the foregoing conditions and limitations, it being understood that in no event will Landlord be required to use more than its typical marketing efforts nor shall, if Landlord has other premises in the Building available to lease, shall Landlord be required to favor the Premises, and Landlord shall be permitted to lease all other available premises before leasing the Premises. In any such case, Landlord may make repairs, alterations in or to the Premises, and redecorate same, to the extent Landlord deems necessary or desirable, and Tenant shall, upon demand, pay the cost thereof, together with Landlord’s expenses for reletting including, without limitation, any broker’s commission incurred by Landlord. If the consideration collected by Landlord upon any such reletting plus any sums previously collected from Tenant are not sufficient to pay the full amount of all Base Rental and additional rent hereunder and other sums reserved in this Lease for the remaining term hereof, together with the cost or repairs, alterations, additions, redecorating, and Landlord’s expenses of reletting and the collection of the rent accruing therefrom (including attorney’s fees and broker’s commissions), Tenant shall pay to Landlord the amount of such deficiency upon demand and Tenant agrees that Landlord may file suit to recover any sums falling due under this subparagraph (d) from time to time.

(e) In the event of any default in the payment of any installment when due, or upon any amount falling due pursuant to this paragraph, (or for any other breach of any other provisions of this Lease), Tenant agrees to pay Landlord the actual attorneys’ fees incurred by Landlord in the collection of any such amounts paid after expiration of any application grace or cure period, including any and all costs and expenses of litigation.

Pursuit of any of the remedies provided in this Paragraph 26 shall not preclude pursuit of any of the other remedies herein provided or any other remedies provided by law (all such remedies being cumulative), nor shall pursuit of any remedy herein provided constitute a forfeiture or waiver of any rent due to Landlord hereunder or of any damages accruing to Landlord by reason of a violation of any of the terms, provisions and covenants herein contained. Landlord’s acceptance of the payment of rental or other payments hereunder after the occurrence of an event of default shall not be construed as a waiver of such default, unless Landlord so notifies Tenant in writing. Forbearance by Landlord in enforcing one or more of the remedies herein provided upon an event of default shall not be deemed or construed to constitute a waiver of such default of Landlord’s right to enforce any such remedies with respect to such default or any subsequent default. Without limiting the foregoing, to the extent permitted by law, Tenant hereby: (i) appoints and designates the Premises as a proper place for service of process upon Tenant, and agrees that service of process upon any person apparently employed by Tenant upon the Premises or leaving process in a conspicuous place within the Premises shall constitute a personal service of such process upon Tenant (provided, however, Landlord does not hereby waive the right to serve Tenant with process by any other lawful means); (ii) expressly waives any right to trial by jury; (iii) expressly waives the service of any notice under any existing or future law of the State of Georgia applicable to landlords and tenants; (iv) expressly consents to the personal jurisdiction of the courts of the State of Georgia; and (v) expressly waives the defense of failure to mitigate damages or any other defense which would constitute a diminution of any remedies or damages to which Landlord is entitled hereunder.

In no event shall Tenant have the right to terminate or rescind this Lease as a result of the breach of any promise or inducement hereof, whether in this Lease or elsewhere. Tenant hereby waives such remedies of termination and recission and hereby agrees that Tenant’s remedies for default hereunder and for breach of any promise or inducement shall be limited to a suit for damages and/or injunction. In addition, Tenant hereby covenants that, prior to the exercise of any such remedies, it will give the holder of any deed to

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secure debt or similar instrument encumbering the Building, notice of and a reasonable time to cure any default by Landlord.

27. Quiet Enjoyment. Landlord represents and warrants that it has full right and authority to enter into this Lease and that Tenant, while paying the Base Rental and additional rent hereunder and performing its other covenants and agreements herein set forth, shall peaceably and quietly have, hold and enjoy the Premises for the term hereof without hindrance or molestation from Landlord, subject to the terms and provisions of this Lease. In the event this Lease is a sublease, then Tenant agrees to take the Premises subject to the provisions of the prior leases. Landlord shall not be liable for any interference or disturbance by other tenants or third persons, nor shall Tenant be released from any obligations of this Lease because of such interferences or disturbances.

28. Surrender of Premises.

(a) At the end of the term or any renewal thereof or other sooner termination of this Lease, the Tenant will peaceably deliver up to the Landlord possession of the Premises, together with all improvements or additions upon or belonging to the same, by whomsoever made, in the same conditions as received or first installed, ordinary wear and tear, damage by fire, earthquake, act of God or the elements alone excepted. Tenant shall, upon the termination of this Lease, remove all movable furniture and equipment belonging to Tenant, at Tenant’s sole cost, title to which shall be in name of Tenant until such termination, repairing any damage caused by such removal. Property not so removed shall be deemed abandoned by the Tenant, and title to the same shall thereupon pass to Landlord. Upon request by Landlord, Tenant shall remove, at Tenant’s sole cost, any or all permanent improvements or additions to the Premises installed by or for the account of Tenant and all movable furniture and equipment belonging to Tenant which may be left by Tenant and Tenant shall repair any damage resulting from such removal and restore the Premises to its original condition provided, however, that Landlord shall give Tenant written notification of the improvements that must be removed under Paragraph 2 of Exhibit “B” hereto at the time of Landlord’s approval of such drawings and, with respect to subsequent alterations, at the time of Landlord’s consent to such alteration, Any and all property which Tenant fails to remove from the Premises or the Building upon termination of this Lease may be handled, removed and stored by or at the direction of Landlord, at the sole risk, cost and expense of Tenant, and Landlord shall in no event be responsible for the value, preservation or safekeeping thereof. Tenant shall pay to Landlord, upon demand, any and all expenses incurred in such removal and all storage charges against such property so long as the same shall be in Landlord’s possession or under Landlord’s control.

(b) The voluntary or other surrender of this Lease by Tenant, or a mutual cancellation thereof, shall not work a merger, and shall, at the option of the Landlord, terminate all or any existing subleases or subtenancies, or may, at the option of Landlord, operate as an assignment to it if any or all such subleases or subtenancies.

29. Subordination and Attornment.

(a) This Lease and all rights of Tenant hereunder are and shall be subject and subordinate to the lien and security title of any deed to secure debt or similar instrument which may now or hereafter encumber Landlord’s title in and to the Building and to any modifications, renewals, consolidations, extensions, or replacements thereof. Landlord shall, however, use commercially reasonable efforts to obtain a subordination, nondisturbance and attornment agreement in its lender’s standard form in favor of Tenant.

(b) Subparagraph (a) above shall be self-operative, and no further instrument of subordination shall be required. However, in confirmation of such subordination, Tenant shall, within five (5) business days following Landlord’s written notice, at any time or times, execute, acknowledge, and deliver to Landlord or the holder of any such deed to secure debt or similar instrument, without expense, such instruments as may be reasonably requested by Landlord or such holder to evidence the subordination of this Lease and all rights hereunder to the lien of any such deed to secure debt or similar instrument, and each renewal, modification, consolidation, replacement, and extension thereof, and if Tenant shall fail at any time, within ten (10) days following the giving of a written request therefore to execute, acknowledge, and deliver any such instrument, Landlord in addition to any other remedies available to it in consequence thereof, may execute, acknowledge, and deliver the same as the attorney-in-fact of Tenant and in Tenant’s name, place, and stead, and Tenant hereby irrevocably makes, constitutes, and appoints Landlord and its successors and assigns, such attorney-in-fact for that purpose.

(c) If the holder of any deed to secure debt or similar instrument encumbering Landlord’s title in and to the Building shall hereafter succeed to the rights of Landlord under this Lease, whether through possession or foreclosure action or delivery of a new lease, Tenant shall, at the option of such holder, attorn to and recognize such successor as Tenant’s landlord under this lease and shall promptly execute and deliver any instrument that may be necessary to evidence such attornment, and Tenant hereby irrevocably appoints Landlord or such holder the attorney-in-fact of Tenant to execute and deliver such instrument on behalf of Tenant should Tenant refuse and fail to do so within ten (10) days after Landlord or such holder shall have given notice to Tenant requesting the execution and delivery of such instrument. Upon such attornment, this Lease shall continue in full

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force and effect as a direct lease between such successor landlord and Tenant, subject to all of the then executory terms, covenants, and conditions of this Lease.

30. Tenant Estoppel Letter. Within ten (10) business days following any written request which Landlord may make from time to time, Tenant shall execute and deliver to Landlord a Tenant Estoppel Letter substantially in the form attached hereto as Exhibit “C” and made a part hereof (and modified from time to time by Landlord as required for any change in the lender entity), indicating thereon any exceptions thereto which may exist at that time. Failure of the Tenant to execute and deliver such certificate shall constitute an acceptance of the Premises and acknowledgement by Tenant that the statements included in Exhibit “C” are true and correct without exception. Landlord and Tenant intend that any statement delivered pursuant to this Paragraph 30 may be relied upon by Landlord or by any lender, purchaser or prospective purchaser of the Building or the Property or anyone else to whom Landlord may provide said letter.

31. Waiver. If either Landlord or Tenant waives the performance of any term, covenant or condition contained in this Lease, such waiver shall not be deemed to be a waiver of any subsequent breach of the same or of any other term, covenant or condition contained herein.

32. Security Deposit. The Security Deposit shall be held by Landlord without liability for interest and as security for the performance by Tenant of Tenant’s covenants and obligations under this Lease, it being expressly understood that the Security Deposit shall not be considered an advance payment of rent or a measure of Landlord’s damages in case of default by Tenant. Landlord may, from time to time, without prejudice to any other remedy, use the Security Deposit to the extent necessary to make good any arrearages of rent or to satisfy any other covenant or obligation of Tenant hereunder. Following any such application of the Security Deposit, Tenant shall pay to Landlord on demand the amount so applied in order to restore the Security Deposit to its original amount. Landlord shall be entitled to commingle the Security Deposit with other funds of Landlord, and the Security Deposit shall not be deemed to be held in trust by Landlord for Tenant or any other person. Although the Security Deposit shall be deemed the property of Landlord, any remaining balance of such deposit shall be returned by Landlord to Tenant or Tenant’s last permitted assignee at such time after termination of this Lease when Landlord shall have determined that all of Tenant’s obligations under this Lease (including, without limitation, the obligations of Tenant to maintain and repair the Premises) have been fulfilled. On the occurrence of any events of default as described in the Lease, said Security Deposit shall become due and payable to Landlord. If the Building is conveyed by Landlord, said Security Deposit may be paid over to Landlord’s successor and, if so, Tenant hereby releases Landlord from any and all liability with respect to said Security Deposit and its application or return. The Security Deposit shall not be assigned or encumbered by Tenant without the written consent of Landlord and such assignment or encumbrance without Landlord’s consent shall be void.

(a) Tenant’s Security Deposit shall be in the form of a clean, irrevocable and unconditional letter of credit payable at sight in a form acceptable to Landlord in its sole discretion (“Letter of Credit”), which Letter of Credit shall be tendered by Tenant to Landlord on or before the date of this Lease. and shall be in the form of the letter of credit attached hereto as Exhibit “E”. The Letter of Credit shall be issued by a bank or financial institution and branch, all approved by Landlord in its sole discretion (hereinafter referred to as the “Bank”) in favor of Landlord, as security for the faithful performance and observance by Tenant of the terms, conditions and provisions of this Lease, including without limitation the surrender of possession of the Premises to Landlord as herein provided. Landlord hereby approves Wells Fargo Bank as the issuer of the Letter of Credit. Provided that Tenant is not in default under this Lease beyond any applicable grace or cure period on each annual anniversary of the issuance of the Letter of Credit, the amount of the Letter of Credit may be reduced by the amount of Twenty-Five Thousand and 00/100 ($25,000.00) on the first day of the sixteenth (16^th) month following the Commencement Date, and each twelve (12) months thereafter. The Letter of Credit shall have a term which expires no sooner than forty-five days after the Expiration Date, or Tenant may deliver a one (1) year unconditional and irrevocable Letter of Credit which by its terms automatically, for the remainder of the Term, renews for successive one (1) year periods unless the Bank provides no less than thirty (30) days written notice to Landlord that such Letter of Credit shall not be renewed, in which event Landlord shall have the right to draw down the entire amount of the Letter of Credit unless Tenant substitutes, prior to the expiration of such letter of Credit, a new Letter of Credit which meets the requirements of this Paragraph 32. The Letter of Credit shall permit multiple drawings and be fully transferable by Landlord without the payment of any fees or charges by Landlord. If Tenant defaults in respect of any of the terms, conditions or provisions of this Lease including, but not limited to, the payment of Rent, and Tenant fails to cure any such default after any required notice and within any applicable cure period hereunder or if Landlord receives a notice that the Letter of Credit shall not be renewed, (i) Landlord shall have the right to require the Bank to make payment to Landlord or its designee of the entire proceeds of the Letter of Credit required to cure such default, and (ii) Landlord may, at the option of Landlord (but Landlord shall not be required to) apply or retain the whole or any part of such sum so paid to it by Tenant or the Bank to the extent required for the payment of any Rent or any other sum as to which Tenant is in default, and any damages to which Landlord is entitled pursuant to the Lease, whether such damages accrue before or after summary proceedings or other reentry by Landlord, and (iii) Landlord or any Superior Mortgagee shall hold the remainder of such sum paid to it by the Bank or Tenant, if any, for Landlord’s benefit, as security for the faithful performance and observance by Tenant of the terms, covenants, and conditions of this Lease on Tenant’s part to be observed and performed, with the same rights as hereinabove set forth to apply or retain the same in the event of any further default by Tenant under this Lease. If Landlord applies or retains any part of the proceeds of the Letter of Credit, Tenant shall, within five (5) business days after demand from Landlord, restore the Letter of

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Credit to its original amount and deliver it to Landlord or its designee the so that Landlord or its designee shall have the full Letter of Credit on hand at all times during the Term of this Lease (and any extension). Tenant’s failure to do so within ten (10) days of receipt of such demand shall constitute a breach of this Lease. Landlord shall, at the expiration or earlier termination of this Lease (provided that such earlier termination was not the result of Tenant’s default that exhauster the Letter of Credit), return the Letter of Credit to Tenant (but subject to offset by any draws made by Landlord as of such date or permitted under this Lease.)

(b) In the event of a transfer, sale or lease of Landlord’s interest in the Building, Landlord shall transfer or cause to be transferred either the cash or Letter of Credit or any sums collected thereunder by Landlord, together with any other sums then held by Landlord or its designee as such security, to the transferee, vendee or lessee; Tenant, at its sole cost, shall arrange for the transfer of the Letter of Credit, and Landlord thereupon shall be released by Tenant from all liability under this Paragraph. Tenant agrees to look solely to the new landlord for the return of the cash or Letter of Credit or any sums collected thereunder and any other security, and it is agreed that the provisions hereof shall apply to every transfer or assignment made of the Letter of Credit or any sums collected thereunder and any other security to a new landlord. Tenant further covenants that it shall not assign or encumber, or attempt to assign or encumber, any part of such security and that neither Landlord nor its successors or assigns shall be bound by any such assignment, encumbrance, attempted assignment, or attempted encumbrance. Landlord shall not be required to exhaust its remedies against Tenant before having recourse to the Letter of Credit or such cash security held by Landlord. Recourse by Landlord to the Letter of Credit or such security shall not affect any remedies of Landlord which are provided in this Lease or which are available to Landlord in law or equity.

(c) In the event that Tenant shall fully and faithfully comply with all of the terms, provisions, covenants and conditions of this Lease, the Letter of Credit except as same may have been applied by Landlord in accordance with this Lease, shall be returned to Tenant promptly after the expiration of this Lease.

33. Notices.

Whenever any notice, demand or request is required or permitted hereunder, such notice shall be sent by United States Mail, registered, postage pre-paid, or by a commercial mail service with delivery confirmed by receipt or, if by hand delivery, with confirmation delivery as described above to the address set forth below:

Tenant:	Before the Commencement Date	From and after the Commencement Date:
	3101 Park Boulevard	3700 Crestwood Parkway, Suite 300
	Palo Alto, California 94306	Duluth, GA 30096
		With a copy to:
		3101 Park Boulevard
		Palo Alto, California 94306
Landlord:	Parmenter GCC LP, LLLP	Parmenter GCC LP, LLLP
	c/o Parmenter Realty Partners 3700 Crestwood Parkway	c/o Parmenter Realty Partners
	Suite 180	1111 Brickell Avenue
	Duluth, GA 30096	Miami, Florida 33131
		Attn: Asset Management

With a copy of notices to Landlord to:

MassMutual

c/o Babson Capital Management LLC

Attention: Asset Manager

1919 M Street, NW

Suite 300

Washington, DC 20036

Any notice, demand or request which shall be served upon either of the parties in the manner aforesaid shall be deemed sufficiently given for all purposes hereunder (i) at the time such notices, demands or requests are hand-delivered in person or (ii) on the third day after the mail of such notices, demands or requests in accordance with the preceding portion of this Paragraph 33.

Either Landlord or Tenant shall have the right from time to time to designate by written notice to the other party such other or changed places in the United States as Landlord or Tenant may desire written notice to

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be delivered or sent in accordance herewith; provided, however, at no time shall either party be required to send more than an original and two copies of any such notice, demand or request required or permitted hereunder.

34. Captions and References. The paragraph headings herein are for convenience of reference and shall in no way define, increase, limit, or describe the scope or intent of any provision of this Lease.

35. Successors and Assigns. The words “Landlord” and “Tenant” as used herein include the respective contracting party, whether singular or plural, and whether an individual, masculine or feminine, or a partnership, joint venture, business trust, or corporation. The provisions of this Lease shall inure to the benefit of and be binding upon Landlord and Tenant, and their respective successors, and assigns subject, however, to the provisions of Paragraph 19 hereof.

36. Severability. If any clause, phrase, provisions or portions of this Lease or the application thereof to any person or circumstance shall be invalid or unenforceable under applicable law, such event shall not affect, impair or render invalid or unenforceable the remainder of this Lease or any other clause, phrase, provision or portion hereof, nor shall it affect the application of any clause, phrase, provision or portion to other persons or circumstances, and it is also the intention of the parties to this Lease that in lieu of each such clause, phrase, provision or portion of this Lease that is invalid or unenforceable, there be added as a part of this Lease a clause, phrase, provision or portion as similar in terms to such invalid or unenforceable clause, phrase, provision or portion as may be possible and be valid and enforceable.

37. Governing Law. This lease and the rights and obligations of the parties hereto shall be interpreted, construed, and enforced in accordance with the laws of the State of Georgia.

38. Force Majeure. Whenever a period of time is herein prescribed for the taking of any action by Landlord, Landlord shall not be liable or responsible for, and there shall be excluded from the computation of such period of time, any delays due to strikes, riots, fire, acts of God, shortages of labor or materials, war, governmental laws, regulations or restrictions, or any other cause whatsoever beyond the control of Landlord.

39. Time of Essence. Time is of the essence of this Lease and all of its provisions.

40. Entire Agreement. This Lease together with its exhibits contains all the agreements of the parties hereto and supersedes any previous negotiations. There have been no representations made by the Landlord or understandings made between the parties other than those set forth in this Lease and its exhibits. This Lease may not be modified except by a written instrument signed by the parties hereto.

41. Survival of Tenant’s Obligations. All obligations of Tenant hereunder not fully performed as of the expiration or earlier termination of the term of this Lease shall survive the expiration or earlier termination of the term hereof.

42. Holding Over. In no event shall there be any renewal of this Lease by operation of law, and if Tenant remains in possession of the Premises after the termination of this Lease and without a new lease executed by Landlord and Tenant, Tenant shall be deemed to be occupying the Premises as a tenant at sufferance on a month to month basis and shall pay rent in an amount equal to two hundred percent (200%) of the Base Rental and additional rent provided for in this Lease and otherwise subject to all the covenants and provisions of this Lease insofar as the same are applicable to a month-to-month tenancy.

43. Corporate Authority. If Tenant is a corporation each of the persons executing this Lease on behalf of Tenant does hereby covenant and warrant that Tenant is a duly authorized and existing corporation, that Tenant has and is qualified to do business in Georgia, that the corporation has full right and authority to enter into this Lease, and that each and both persons signing on behalf of the corporation were authorized to do so Upon Landlord’s request, Tenant shall provide Landlord with evidence reasonably satisfactory to Landlord confirming the foregoing covenants and warranties.

44. Mortgage Approvals. Landlord shall not be deemed to have unreasonably withheld its consent or approval of any matter hereunder if the holder of any deed to secure debt or similar instrument encumbering the Building or the Property or any portion thereof shall refuse or withhold its approval or consent thereto. Any requirement which Landlord imposes pursuant to the direction of any such holder shall be deemed to have been reasonably imposed by Landlord if made in good faith.

45. Landlord’s Lien. Intentionally Omitted.

46. Landlord’s Liability. In no event shall Landlord’s liability for any breach of this Lease exceed Landlord’s equity in the Building and the Property. This provision is not intended to be a measure or agreed amount of Landlord’s liability with respect to any particular breach, and shall not be utilized by any court or otherwise for the purpose of determining any liability of Landlord hereunder, except only as a maximum amount not to be exceeded in any event. Neither Landlord nor any partner of Landlord shall have any personal liability with respect to any of the provisions of this Lease, and if Landlord is in default with respect to its obligations under this Lease, Tenant shall look solely to Landlord’s equity in the Building and the Property.

47. Right to Relocate. Intentionally Omitted.

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48. Rules and Regulations. Tenant shall faithfully observe and comply with the Rules and Regulations attached hereto as Exhibit “D” to this Lease and all reasonable modifications thereof and additions thereto from time to time put into effect by Landlord. Landlord shall not be responsible for the nonperformance by any other tenant or occupant of the Building of any of said Rules and Regulations. Landlord shall use commercially reasonable efforts to uniformly apply the Rules and Regulations on a nondiscriminatory basis. In the event of any conflict between this Lease and the Rules and Regulations, the terms of this Lease shall prevail. Notwithstanding any contrary terms of the Rules and Regulations, Tenant shall be permitted to install and use a supplemental HVAC unit provided that: Landlord has approved such unit and plans and specifications for its installation; Tenant bears the full cost of acquisition and installation of such unit, such unit is separately metered or sub-metered (at Landlord’s election) so that Tenant bears the full cost of electrical service to such unit; Tenant obtains a monthly maintenance agreement to keep such unit in good order and repair; and, if required by Landlord at the time of Landlord’s consent to such unit, Tenant removes it at Tenant’s cost and expense at the expiration or earlier termination of this Lease and repairs any damage caused by its installation and removal.

49. Transfers by Landlord. Landlord shall have the right to transfer and assign, in whole or in part all its rights and obligations hereunder and in the Building or the Property, and in such event and upon such transfer Landlord shall be released from any further obligations hereunder, and Tenant agrees to look solely to such successor in interest of Landlord for the performance of such obligations. Tenant agrees to attorn to such successor in interest of Landlord.

50. Commissions. Tenant represents and warrants to Landlord that (except with respect to any broker identified in Paragraph 1 hereof) no broker or other person has represented Tenant in the negotiations for and procurement of this Lease and that no commissions or compensation of any kind are due and payable in connection herewith to any broker or other person. Tenant agrees to indemnify and hold Landlord harmless from any and all claims, suits, or judgments (including, without limitation, reasonable attorneys’ fees and court costs incurred in the enforcement of this indemnity or otherwise) for any commissions or compensation of any kind which arise out of or are in any way connected with any claimed agency relationship with Tenant (except for any broker identified in Paragraph 1 above).

51. Submission of Lease. The submission of this Lease to Tenant for examination does not constitute an offer to lease, and this Lease shall be effective only upon its complete execution by both Landlord and Tenant. Execution of this Lease by Tenant and delivery of such Lease to Landlord for its execution shall constitute an offer to lease to Landlord which shall remain open for Landlord’s acceptance for a period of seven (7) business days after the receipt by Landlord of such executed Lease.

52. Financial Statements. At any time during the term of this Lease, and in the event that Tenant is in default under the terms hereof or in the event that Landlord requires such information in connection with the financing, refinancing, sale, or from investors or prospective investors, Tenant and any Guarantor shall, upon ten (10) days’ prior written notice from Landlord, provide Landlord with a current financial statement and financial statements of the two (2) years prior to the current financial statement year. Such statement shall be prepared in accordance with generally accepted accounting principles consistently applied and, if such is the normal practice of Tenant, shall be audited by an independent certified public accountant.

53. Special Stipulations. Special Stipulations are set forth in Exhibit B hereto.

In the event that the following conflicts with the foregoing provisions of this Lease, the following shall control:

EXHIBIT A: Premises

EXHIBIT B: Special Stipulations

EXHIBIT C: Tenant Estoppel Letter

EXHIBIT D: Rules and Regulations

EXHIBIT E Form of Letter of Credit

[SIGNATURES TO FOLLOW]

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease in multiple counterparts each of which shall be deemed an original as of the day and year first above written

LANDLORD: PARMENTER GCC LP, LLLP
BY:	3700 Crestwood LLC
	Its General Partner
BY:	/s/ Andrew R. Weiss
	Andrew R. Weiss Its Vice President
TENANT:
DANGER, INC., a Delaware corporation
BY:	/s/ Henry R. Nothhaft
TITLE:	Chairman and CEO
ATTEST:	/s/ Scott Darling
TITLE:	General Counsel, Corp. Secretary
	(CORPORATE SEAL)

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EXHIBIT “A”

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EXHIBIT “B”

SPECIAL STIPULATIONS

Lease agreement between Parmenter GCC LP, LLLP, as Landlord and Danger, Inc., as Tenant dated                      for 5,639 rentable square feet.

These Special Stipulations are made and entered into contemporaneously with the lease agreement described above. In the case of any conflict between the Special Stipulations and the Lease, these Special Stipulations shall control. All terms used herein shall be the same as defined in the Lease.

1. Base Rental. Base rental payments shall be as follows:

Months	Annual Amount			Monthly Amount
1-3		Abated			NA
4-12	$	82,470.42 (9 months	)	$	9,163.38
13-24	$	113,259.36		$	9,438.28
25-36	$	116,657.04		$	9,721.42
37-48	$	120,156.84		$	10,013.07
49-60	$	123,761.52		$	10,313.46

2. Improvements. Landlord at Landlord’s expense shall build out the premises turnkey Building standard according to drawings dated                     , provided by RWB Interiors with Landlord’s contribution not to exceed $20.00 per rentable foot of the Premises for all costs including construction costs, architectural, engineering and construction management fees (construction management fees not to exceed 5%). Landlord shall cause the Premises to be constructed in accordance with the then applicable requirements of the Americans with Disabilities Act. Tenant may apply any otherwise unutilized portion of such contribution to offset Tenant’s actual and commercially reasonable costs of installing low voltage wiring in the Premises. The Premises shall be, on the Commencement Date, in good working order and repair, subject to Landlord’s completion of a list of unfinished details, which written list shall be agreed upon by Landlord and Tenant on or about the Commencement Date and shall be completed by Landlord within forty-five (45) days thereafter.

Tenant may elect to vary from the plans and specifications, however, such changes shall be confirmed by a work change order prior to the performance of such changes and Landlord will make no changes without Tenant’s specific written approval. Landlord will not be responsible for delays in the completion of the Premises resulting from changes made at the request of the Tenant after final construction documents are issued. Tenant shall pay Landlord for such changes resulting in increased construction costs within 30 days of issuance of a Certificate of Occupancy. During the course of construction of the Premises, any changes made by Tenant will not delay the Commencement Date. Landlord’s failure to deliver possession due to Tenant’s failure to pay any such cost shall not be a breach of this Lease.

3. Representation. In this transaction the Landlord has been represented by Parmenter Realty & Investment Company and not CRESA Partners of Georgia, LLC, and Parmenter Realty & Investment Company shall be paid a commission by the Landlord. The Tenant has been represented by CRESA Partners of Georgia, LLC and not Parmenter Realty and Investment Company and CRESA Partners of Georgia, LLC shall be paid a commission by the Landlord.

4. Rental Payments. All rental payments shall be addressed as follows or to such other address as Landlord may from time direct by written notice to Tenant:

Parmenter GCC LP, LLLP

Dept. AT 952189

Atlanta, GA 31192-2139

5. Right of First Offer: Tenant shall have the right of first offer to expand the Premises to include an area stipulated by Landlord and Tenant to consist of 2,219 rentable square feet adjacent to the Premises and known as Suite 320 (the “First Offer Space”). The First Offer Space is leased as of the date hereof. Landlord shall give Tenant written notice at the time that the First Offer Space is available to lease, together with the terms on which Landlord is willing to lease the First Offer Space. Tenant shall, within five (5) business days following its receipt of Landlord’s written notice, given written notice to Landlord if Tenant shall lease the First Offer Space on the terms set forth in Landlord’s notice. In the event that Tenant fails to timely accept Landlord’s offer of the First Offer Space on the terms set forth in Landlord’s notice, Tenant’s right of first offer shall be deemed to have expired.

6. Early Termination Option. Provided that Tenant is not in default under the terms hereof, and further provided that Tenant has not expanded the Premises by agreement with Landlord or by exercise of the Right of First Offer set forth herein, Tenant shall have the right to accelerate the expiration date of this

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Lease (“Early Termination Option”) to the last day of the thirty-ninth (39^th) month following the Commencement Date (the “Early Termination Date”) upon the following express conditions: (i) Tenant shall provide to Landlord no less than one hundred eighty (180) days written notice in advance of the Early Termination Date (“Termination Notice”) of its exercise of this Early Termination Option. As a condition of the Early Termination Option, Tenant shall tender to Landlord, as an agreed upon and stipulated termination fee (“Termination Fee”), as hereinafter described, within ten (10) business days following Tenant’s receipt of Landlord’s written notice of the amount of the Termination Fee. The Termination Fee shall be comprised of Landlord’s “Unamortized Up Front Costs” as of the Early Termination Date. For purposes hereof, Landlord’s “Unamortized Up Front Costs” shall mean (i) the unamortized portion of the amount expended by Landlord for allowances expended by Landlord under this Lease, and (ii) the unamortized portion of brokerage commissions paid to the brokers in connection with this Lease. Landlord’s Unamortized Up Front Costs shall be amortized on a straight line basis over the term at an annual interest rate of 8% accruing from the date of this Lease until Tenant’s payment of the Early Termination Fee, but no amortization shall be deemed to have occurred during any period of rent abatement.

7. Temporary Premises. For so long as Tenant is not in default under the terms of the Lease, Landlord shall allow Tenant to occupy the Suite 290 in the Building, consisting of 3,284 square feet, prior to the Commencement Date (the “Early Occupancy Term”) under the terms and conditions of the Lease except as expressly amended herein:

A. The Early Occupancy Term shall commence on the business day following the date that Landlord and Tenant have executed the Lease, or such later date that Tenant shall have delivered to Landlord evidence of the insurance required under the Lease, and shall expire on the Commencement Date. Tenant has inspected Suite 290 and accepts Suite 290 in AS-IS condition for the Early Occupancy Term.

B. The Early Occupancy Term shall be in addition, and not offset or credited against, the Lease Term as defined in the Lease. The Early Occupancy Term is for a term prior to the Commencement Date and does not either amend or restate the Lease Term.

C. Tenant’s obligation to pay Base Rental shall be abated for the Early Occupancy Term.

8. Renewal Option.

A. Exercise of Options. Provided Tenant is not in default (beyond any applicable notice and grace periods) pursuant to any of the terms and conditions of this Lease, Tenant shall have the option (the “Option”) to renew this Lease for one (1) additional five (5) year period (the “Option Period”) for the period commencing on the date following the expiration date of the initial Lease Term, upon the terms and conditions contained in this Lease, except, as provided in this Paragraph 8. To exercise the Option, Tenant shall give Landlord notice (the “Extension Notice”) of the intent to exercise said Option not less than one hundred eighty (180) days prior to the date on which the Option Period which is the subject of the notice will commence. In the event Tenant shall exercise the Option for the Option Period, this Lease will terminate in its entirety at the end of the Option Period exercised by Tenant, and Tenant will have no further option to renew or extend the Lease Term.

B. Determination of Base Rent. The Base Rent for the Option Period shall be determined as follows:

(1) Landlord and Tenant will have thirty (30) days after Landlord receives the Extension Notice within which to agree on the fair market rental value (as defined in subsection (2) below) of the Premises as of the commencement date of the Option Period. If they agree on the Base Rent within thirty (30) days, they will amend this Lease by stating the Base Rent.

(2) If Landlord and Tenant are unable to agree on the Base Rent for the Option Period within such thirty (30) days, the Base Rent for the Option Period will be the greater of (i) the-fair market rental value of the Premises as of the commencement date of the Option Period as determined in accordance with subsection (3) hereof, and (ii) the Base Rent payable under this Lease immediately prior to such Option Period. As used in this Lease, the “fair market rental value of the Premises” means what a landlord under no compulsion to lease the Premises, and a tenant under no compulsion to lease the Premises, would determine as Base Rent for the Option Period, as of the commencement of the Option Period, taking into consideration the uses permitted under this Lease, the quality, size, design and location of the Premises, and the rent for comparable buildings located in the vicinity of the Building.

(3) Within thirty (30) days after the expiration of the thirty (30) day period set forth in subparagraph 1) above, Landlord and Tenant shall each appoint one licensed real estate appraiser with at least ten (10) years experience with similar properties located in the Building’s submarket, and the two appraisers so appointed shall jointly attempt to determine and agree upon the then fair market rental value of the Premises. If they are unable to agree, then each appraiser so appointed shall set one value, and notify the other appraiser, of the value set by him or her, concurrently with such appraiser’s receipt of the value set by the other appraiser. The two appraisers then shall, together, select a third licensed appraiser with at least ten (10) years experience with similar properties located in the area of the Building, who shall make a determination of the then fair market rental value, after reviewing the reports of the first two appraisers appointed by the parties, and after doing such independent research as he/she deems appropriate. The value determined by the third appraiser shall be deemed the then fair market rental value of the Premises. Landlord and Tenant shall be responsible for the cost of the appraiser each appoints and shall share equally in the cost of the third appraiser, if applicable.

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EXHIBIT “C”

TENANT ESTOPPEL LETTER

Date:                          Loan Application No.                         

Massachusetts Mutual Life Insurance Company
1500 Main Street Suite 2100
Springfield, Massachusetts, 01115
Attention:	Mortgage Loan Administration Real Estate Finance Group

Re:

(Property name and location)

To Massachusetts Mutual Life Insurance Company:

The undersigned,                                         , (“Tenant”) understands that Massachusetts Mutual Life Insurance Company (“MassMutual”) has made or will be making a mortgage loan (the “Loan”) on the Property described below. In connection with the Loan, MassMutual will be receiving an assignment of all leases with respect to the Property, including Tenant’s lease, and will be acting in reliance upon this letter.

By signing below, Tenant certifies to and agrees with MassMutual as follows:

1. Tenant leases a portion of the                                          [office building/shopping center/warehouse/other property type] located at                                           [street address, city and state] and known generally as                                          [suite number, floor number] (the “Property”).

2. The lease between Tenant and                                          (“Landlord”) regarding Tenant’s premises (the “Premises”) is dated                                          and is unamended except as follows:                                          [dates of lease amendments]. The lease together with the amendments is referred to herein as the “Lease,” and is the complete statement of Landlord and Tenant regarding the Premises.

3. The Lease provides:

A. Current monthly Fixed or Base rent:                                         ;

i. Base Year         ;

ii. Expense Stop Amount         ;

B. Percentage rent:                                         ;

C. Additional Rent:

(i) Operating Expenses:                                         ;

(ii) Real Property Taxes:                                         ;

(iii) Other (list all):                                         ;

D. Rent Commencement Date:                                         ;

E. Termination Date (exclusive of renewal periods):                                         ;

F. Renewal or Extension Periods:                                         ;

G. Security Deposit:                                         ;

H. Number of Allocated Parking Spaces:                                         ;

I. Parking Fees or Rent Due:                                         ;

J. Option to Purchase Property: None

4. Tenant has accepted and is now in sole possession of the Premises. Any construction, build out, improvements, alterations or additions to the Premises or the Property required under the Lease have been completed in accordance with the Lease and Landlord has paid to Tenant all tenant improvement allowances and has paid all other tenant inducements other than as follows:

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                                                                                                                                                                                                                               .

5. Tenant has not subleased any part of the Premises or assigned the Lease.

6. As of this date, the Lease is in full force and effect and there is no violation of or default under the Lease on the part of Landlord or Tenant. There is no present offset of rent and Tenant has no knowledge of any circumstances which would give rise to any credit or set-off against the obligation for present or future rentals under the Lease. All free rent, if any, provided for in the Lease has been used and Tenant is not entitled to any free rent in the future.

7. As of the date hereof, there are no actions whether voluntary or otherwise, pending against Tenant under the bankruptcy or insolvency laws of the United States or any state thereof.

8. Tenant has no right to terminate the Lease except to the extent contained in the Lease, in connection with a casualty or condemnation and except, to the extent permitted by applicable law, in connection with an actual or constructive eviction of Tenant.

9. Tenant will, concurrently with the giving of any notice to Landlord, give MassMutual written notice (at the above address) of any default by Landlord under the Lease. MassMutual will have a reasonable opportunity, but no obligation, before the exercise of any rights or remedies Tenant may have pertaining to the Lease, to cure any such default by Landlord.

10. Tenant hereby subordinates all of its right, title and interest under the Lease to the lien, operation and effect of any mortgage(s) (as modified or extended) of MassMutual now or hereafter in force against the Property, and to all advances hereafter made under such mortgage(s).

11. In the event that MassMutual or any third party becomes the owner of the Property, by foreclosure or otherwise, Tenant agrees to attorn to MassMutual or any such owner and to recognize MassMutual or any such owner as Landlord under the Lease. Acceptance of this letter by MassMutual constitutes MassMutual’s agreement that it will not disturb or interfere with Tenant’s possession of the Premises during the term of the Lease or any extension or renewal thereof so long as Tenant is not in default under the Lease.

Tenant understands that MassMutual is relying on this Estoppel in connection with its determination to make the Loan.

Sincerely,

TENANT:
			[As specified in Lease]
By		[Signature]
	(Print Name):
Title:

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EXHIBIT “D”

RULES AND REGULATIONS

1. Sidewalks, halls, passages, exits, entrances, elevators, escalators and stairways shall not be obstructed by Tenants or used by them for any purpose other than for ingress and egress from their respective premises. The halls, passages, exits, entrances, elevators and stairways are not for the use of the general public and Landlord shall in all cases retain the right to control and prevent access thereto by all persons whose presence, in the judgment of Landlord, shall be prejudicial to the safety, character, reputation and interests of the Building and its Tenants, provided that nothing herein contained shall be construed to prevent such access to persons with whom any Tenant normally deals in the ordinary course of such Tenant’s business unless such persons are engaged in illegal activities. No Tenant, and no employees or invitees of any Tenant, shall go upon the roof of the Building, except as authorized by Landlord.

2. No sign, placard, picture, name, advertisement or notice, visible from the exterior of the leased premises shall be inscribed, painted, affixed, installed or otherwise displayed by any tenant either on its premises or any part of the Building without the prior written consent of Landlord, and Landlord shall have the right to remove any such sign, placard, picture, name, advertisement, or notice without notice to and at the expense of Tenant.

If Landlord shall have given such consent to any Tenant at any time, whether before or after the execution of the Lease, such consent shall in no way operate as a waiver or release of any of the provisions hereof or of such Lease and shall be deemed to relate only to the particular sign, placard, picture, name, advertisement or notice so consented to by Landlord and shall not be construed as dispensing with the necessity of obtaining the specific written consent of Landlord with respect to any other such sign, placard, picture, name, advertisement or notice.

All approved signs or lettering on doors and walls shall be painted, affixed and inscribed at the expense of the Tenant by a person approved by Landlord.

3. The bulletin board or directory of the Building will be provided exclusively for the display of the name and location of Tenants only and Landlord reserves the right to exclude any other names therefrom.

4. No curtains, draperies, blinds, shutters, shades, screens or other coverings, awnings, hangings or decorations shall be attached to, hung or placed in, or used in connection with, any window or door on any premises without the prior written consent of Landlord. In any event with the prior written consent of Landlord, all such items shall be installed inboard of Landlord’s standard window covering and shall in no way be visible from the exterior of the Building. No articles shall be placed or kept on the window sills so as to be visible from the exterior of the Building. No articles shall be placed against glass partitions or doors which might appear unsightly from outside Tenant’s premises.

5. Landlord reserves the right to exclude from the Building between the hours of 6 p.m. and 8 a.m. at all hours on Saturday, Sundays and holidays all persons who are not Tenants or their accompanied guests in the Building. Each Tenant shall be responsible for all persons it allows to enter the Building and shall be liable to Landlord for all acts of such persons.

Landlord shall in no case be liable for damages for error with regard to the admission to or exclusion from the Building of any person.

During the continuance of any invasion, mob, riot, public excitement or other circumstances rendering such action advisable in Landlord’s opinion. Landlord reserves the right to prevent access to the Building by closing the doors, or otherwise, for the safety of Tenants and protection of the Building and property in the Building.

6. No Tenant shall employ any person or persons other than the janitor of Landlord for the purpose of cleaning premises unless otherwise agreed to by Landlord in writing. Except with the written consent of Landlord no person or persons other than those approved by Landlord shall be permitted to enter the Building for the purpose of cleaning same. No Tenant shall cause any unnecessary labor by reason of such Tenant’s carelessness or indifference in the preservation of good order and cleanliness of the premises. Landlord shall in no way be responsible to any tenant for any loss of property on the premises, however occurring, or for any damage done to the effects of any Tenant by the janitor or any other person.

7. No Tenant shall obtain or maintain for use upon its premises coin-operated vending machines or receive barbering or shoe shine services in its premises except from persons authorized by Landlord.

8. Each Tenant shall see that all doors of its premises are closed and securely locked and must observe strict care and caution that all water faucets or water apparatus are entirely shut off before the Tenant or its employees leave such premises, and that all utilities shall likewise be carefully shut off so as to prevent waste or damage, and for any default or carelessness the Tenant shall make good all injuries sustained by other Tenants or occupants of the Building or Landlord. On multiple-tenancy floors, all Tenants shall keep the door or doors to the Building corridors closed at all times except for ingress and egress.

9. As more specifically provided in the Tenant’s Lease of the premises, Tenant shall not waste electricity, water or air-conditioning and agrees to cooperate fully with Landlord to assure the most effective operation of the Building’s heating and air-conditioning, and shall refrain from attempting to adjust any controls.

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10. No Tenant shall alter any lock or access device or install a new or additional lock or access device or any bolt off any door of its premises without prior written consent of Landlord. If Landlord shall give its consent, Tenant shall in each case furnish Landlord with a key for any such lock.

11. No Tenant shall make or have made additional copies of any keys or access devices provided by Landlord. Each Tenant upon the termination of the Tenancy, shall deliver to Landlord all the keys or access devices for the Building, offices, rooms and toilet rooms which shall have been furnished the Tenant or which the Tenant shall have had made. In the event of the loss of any keys or access devices so furnished by Landlord, Tenant shall pay Landlord therefor.

12. The toilet rooms, toilets, urinals, wash bowls and other apparatus shall not be used for any purpose other than that for which they were constructed and no foreign substance of any kind whatsoever, including, but not limited to, coffee grounds shall be thrown therein, and the expense of any breakage, stoppage or damage resulting from the violation of this rule shall be borne by the Tenant who, or whose employee or invitees, shall have caused it.

13. No Tenant shall use or keep in its premises or the Building any kerosene, gasoline or inflammable or combustible fluid or material other than limited quantities necessary for the operation or maintenance of office equipment. No Tenant shall use any method of heating or air-conditioning other than that supplied by Landlord.

14. No Tenant shall use, keep or permit to be used or kept in its premises any foul or noxious gas or substance or permit or suffer such premises to be occupied or used in a manner offensive or objectionable to Landlord or other occupants of the Building by reason of noise, odors and/or vibrations or interfere in any way with other Tenants or those having business therein, nor shall any animals or birds be brought in or kept in or about any premises of the Building.

15. No cooking shall be done or permitted by any Tenant on its premises (except microwave ovens or Underwriters’ Laboratory approved equipment for the preparation of coffee, tea, hot chocolate and similar beverages for Tenants and their employees shall be permitted, provided that such equipment and use is in accordance with applicable federal, state and city laws, codes, ordinances, rules and regulations) nor shall premises be used for lodging.

Except with the prior written consent of Landlord, no Tenant shall sell, permit the sale, at retail, of newspapers, magazines, periodicals, theater tickets or any other goods or merchandise in or on any premises, nor shall Tenant carry on, or permit or allow any employees or other person to carry on, the business of stenography, typewriting or any similar business in or from any premises for the service or accommodation of occupants of any other portion of the Building, nor shall the premises of any Tenant be used for the storage of merchandise or for manufacturing of any kind, or the business of a public barber shop, beauty parlor, nor shall the premises of any Tenant be used for any improper, immoral or objectionable purpose, or any business activity other than that specifically provided for in such Tenant’s lease.

16. If Tenant requires telegraphic, telephonic, burglar alarm or similar services, it shall first obtain, and comply with, Landlords instructions in their installation.

17. Landlord will direct electricians as to where and how telephone, telegraph and electrical wires are to be introduced or installed. No boring or cutting for wires will be allowed without the prior written consent of Landlord. The location of burglar alarms, telephones, call boxes or other office equipment affixed to all premises shall be subject to the written approval of Landlord.

18. No Tenant shall install any radio or television antenna, loudspeaker or any other device on the exterior walls or the roof of the Building. Tenant shall not interfere with radio or television broadcasting or reception from or in the Building or elsewhere.

19. No Tenant shall lay linoleum, tile, carpet or any other floor covering so that the same shall be affixed to the floors of its premises in any manner except as approved in writing by Landlord. The expense of repairing any damage resulting from a violation of this rule or the removal of any floor covering shall be borne by the Tenant by whom, or by whose contractors, employees or invitees, the damage shall have been caused

20. No furniture, freight, equipment, materials, supplies, packages, merchandise or other property will be received in the Building or carried up or down the elevators except between such hours and in such elevators as shall be designated by Landlord. Landlord shall have the right to prescribe the weight, size and position of all sales, furniture, files, bookcases or other heavy equipment brought into the Building. Safes or other heavy objects shall, if considered necessary by Landlord, stand on wood strips of such thickness as determined by Landlord to be necessary to properly distribute the weight thereof. Landlord will not be responsible for loss of or damage to any such safe, equipment or property from any cause, and all damage done to the Building by moving or maintaining any such safe, equipment or other property shall be repaired at the expense of Tenant.

Business machines and mechanical equipment belonging to Tenant which cause noise or vibration that may be transmitted to the structure of the Building or to any space therein to such a degree as to be objectionable to Landlord or to any tenants in the Building shall be placed and maintained by Tenant, at Tenant’s expense, on vibration eliminators or other devices sufficient to eliminate noise or vibration. The persons employed to move such equipment in or out of the Building must be acceptable to Landlord.

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21. No Tenant shall place a load upon any floor of the premises which exceeds the load per square foot which such floor was designed to carry and which is allowed by law. No Tenant shall mark, or drive nails, screws or drill into, the partitions, woodwork or plaster or in any way deface such premises or any part thereof.

22. There shall not be used in any space, or in the public areas of the Building, either by Tenant or others, any hand trucks except those equipped with rubber tires and side guards or such other material-handling equipment as Landlord may approve. No other vehicles of any kind shall be brought by any Tenant into or kept in or about the premises.

23. Each Tenant shall store all its trash and garbage within the interior of its premises. No materials shall be placed in the trash boxes or receptacles if such material is of such nature that it may not be disposed of in the ordinary and customary manner of removing and disposing of trash and garbage in this area without violation of any law or ordinance governing such disposal. All trash, garbage and refuse disposal shall be made only through entry ways and elevators provided for such purposes and at such times as Landlord may designate.

24. Canvassing, soliciting, distributing of handbills or any other written material, and peddling in the Building are prohibited and each Tenant shall cooperate to prevent the same. No Tenant shall make room-to-room solicitation of business from other tenants in the Building.

25. Landlord reserves the right to exclude or expel from the Building any person who, in Landlord’s judgment, is intoxicated or under the influence of liquor or drugs or who is in violation of any of the rules and regulations of the Building.

26. Without the prior written consent of Landlord, Tenant shall not use the name of the Building in connection with or in promoting or advertising the business of Tenant except as Tenant’s address.

27. Tenant shall comply with all energy conservation, safety, fire protection and evacuation procedures and regulations established by Landlord or any governmental agency.

28. Tenant assumes any and all responsibility for protecting its premises from theft, robbery and pilferage, which includes keeping doors locked and other means of entry to the premises closed.

29. The requirements of Tenants will be attended to only upon application at the office of the Building by an authorized individual. Employees of Landlord shall not perform any work or do anything outside of their regular duties unless special instruction from Landlord, and no employees will admit any person (Tenant or otherwise) to any office without specific instructions from Landlord.

30. Landlord may waive any one or more of these Rules and Regulations for the benefit of any particular Tenant or Tenants, but no such waiver by Landlord shall be construed as a waiver of such Rules and Regulations in favor of any other Tenant or Tenants, nor prevent Landlord from thereafter enforcing any such Rules and Regulations against any or all Tenants of the Building.

31. Landlord reserves the right to make such other and reasonable rules and regulations as in its judgment may from time to time be needed for safety and security, for care and cleanliness of the Building and for the preservation of good order therein. Tenant agrees to abide by all such Rules and Regulations hereinabove stated and any additional rules and regulations which are adopted.

32. All wallpaper or vinyl fabric materials which Tenant may install on painted walls shall be applied with a strippable adhesive. The use of nonstrippable adhesives will cause damage to the walls when materials are removed, and repairs made necessary thereby shall be made by Landlord at Tenant’s expense.

33. Tenant shall provide and maintain hard surface protective mats under all desk chairs which are equipped with casters to avoid excessive wear and tear to carpeting. If Tenant fails to provide such mats, the cost of carpet repair or replacement made necessary by such excessive wear and tear shall be charged to and paid for by Tenant.

34. Tenant will refer all contractors, contractor’s representatives and installation technicians, rendering any service to Tenant to Landlord for Landlord’s supervision, approval, and control before performance of any contractual service. This provision shall apply to all work performed in the Building, including installations of telephones, telegraph equipment, electrical devices and attachments and installations of any nature affecting floors, walls, woodwork, trim, windows, ceilings, equipment or any other physical portion of the Building.

35. Tenant shall give prompt notice to Landlord of any accidents to or defects in plumbing, electrical fixtures, or heating apparatus so that such accidents or defects may be attended to properly.

36. No Tenant shall store items in any common areas, corridors, stairwells, or restrooms. This includes any mechanical, telephone or other rooms restricted to Landlord.

37. Tenant shall be responsible for the observance of all of the foregoing Rules and Regulations by Tenant’s employees, agents, clients, customers, invitees and guests.

38. These Rules and Regulations are in addition to, and shall not be construed to in any way modify, after or amend, in whole or in part, the terms, covenants, agreements and conditions of any Lease of premises in the Building.

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39. No smoking is allowed within the Building, including any Tenant premises or Building common areas. Landlord may designate a specific smoking area in a suitable area outside of the Building.

40. Tenant shall not store nor bring into the Buildings, Fire Arms, ammunition or other devices generally considered to be a weapon.

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EXHIBIT “E”

FORM OF LETTER OF CREDIT

TRADE SERVICES DIVISION, NORTHERN CALIFORNIA

ONE FRONT STREET, 21^ST FLOOR

SAN FRANCISCO, CALIFORNIA 94111

Contact Phone: 1(800) 798-2815 (Option 1)

Email : sftrade@wellsfargo.com

IRREVOCABLE LETTER OF CREDIT

Beneficiary Name	Letter of Credit No.
Address	Date:                  , 2005
City, State Zip
Attention:

Ladies and Gentlemen:

At the request and for the account of Applicant Name and Address (“Applicant”), we hereby establish our Irrevocable Letter of Credit in your favor in the amount of Amount in Words United States Dollars (US$Amount in Numbers) available with us at our above office by payment of your draft(s) drawn on us at sight accompanied by your signed and dated statement worded as follows with the instructions in brackets therein complied with:

“The undersigned, an authorized representative of the beneficiary (“Beneficiary”) of Wells Fargo Bank Letter of Credit No.                      (the “Wells Credit”) hereby certifies that Applicant Name has defaulted in its obligations under that certain Lease dated [insert date] between Applicant Name and Beneficiary Name (as such lease may be amended, restated or replaced) and the amount drawn under the Wells Credit represents the amount due to Beneficiary as a result of such default.”

This Letter of Credit expires at our above office on Month Day, 2006, but shall be automatically extended, without written amendment, to Month Day in each succeeding calendar year up to, but not beyond, Month Day, 20     unless we have sent written notice to you at your address above by registered mail or express courier that we elect not to renew this Letter of Credit beyond the date specified in such notice which date will be Month Day, 2006 or any subsequent Month Day occurring before Month Day, 20     and be at least 30 calendar days after the date we send you such notice. Upon our sending you such notice of the nonrenewal of the expiration date of this Letter of Credit, you may also draw under this Letter of Credit by presentation to us at our above address, on or before the expiration date specified in such notice, of your draft drawn on us at sight accompanied by your signed and dated statement worded as follows with the instructions in brackets therein complied with:

“The undersigned an authorized representative of the beneficiary (“Beneficiary”) of Wells Fargo Bank, N.A. Letter of Credit No.                      (the “Wells Credit”) hereby certifies that Beneficiary has received written notification from Wells Fargo Bank, N.A. that the Wells Credit will not be extended past its current expiration date. The undersigned further certifies that (i) as of the date of this statement, Beneficiary has not received a letter of credit or other instrument acceptable to the Beneficiary as a replacement to the Wells Credit; and (ii) Beneficiary has not released Applicant Name from its obligations to Beneficiary under that certain Lease dated [insert date] between Applicant Name and Beneficiary Name (as such lease may be amended, restated or replaced). “

Each draft must also be accompanied by the original of this Letter of Credit for our endorsement on this Letter of Credit of our payment of such draft.

Partial and multiple drawings are permitted under this Letter of Credit.

Each draft must be marked “Drawn under Wells Fargo Bank, N.A. Letter of Credit No.                     .”

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If any instructions accompanying a drawing under this Letter of Credit request that payment is to be made by transfer to an account with us or at another bank, we and/or such other bank may rely on an account number specified in such instructions even if the number identifies a person or entity different from the intended payee.

This Letter of Credit is transferable one or more times, but in each instance to a single transferee and only in the full amount available to be drawn under the Letter of Credit at the time of such transfer. Any such transfer may be affected only through ourselves and only upon presentation to us at our above-specified office of a duly executed instrument of transfer in the format attached hereto as Exhibit A together with the original of this Letter of Credit. Any transfer of this Letter of Credit may not change the place of expiration of this Letter of Credit from our above-specified office. Each transfer shall be evidenced by our endorsement on the reverse of the original of this Letter of Credit, and we shall deliver the original of this Letter of Credit so endorsed to the transferee. All charges in connection with any transfer of this Letter of Credit are for the Applicant’s account.

This Letter of Credit is subject to the Uniform Customs and Practice For Documentary Credits (1993 Revision), International Chamber of Commerce Publication No. 500 (the “UCP”), and engages us in accordance therewith.

Very truly yours
WELLS FARGO BANK, N.A.
BY:
	(AUTHORIZED SIGNATURE)

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Exhibit A

Wells Fargo Bank, N.A.

Letter of Credit No.                     

Date:                         

Wells Fargo Bank, N.A.

Trade Services Division, Northern California

One Front Street, 21^st Floor

San Francisco, California 94111

Subject: Your Letter of Credit No.                     

Ladies and Gentlemen:

For value received, we hereby irrevocably assign and transfer all our rights under the above-captioned Letter of Credit, as heretofore and hereafter amended, extended or increased, to:

[insert name of transferee]

[insert address]

By this transfer, all of our rights in the Letter of Credit are transferred to the transferee, and the transferee shall have sole rights as beneficiary under the Letter of Credit, including sole rights relating to any amendments, whether increases or extensions or other amendments, and whether now existing or hereafter made. You are hereby irrevocably instructed to advise future amendment(s) of the Letter of Credit to the transferee without our consent or notice to us.

Enclosed are the original Letter of Credit and the original of all amendments to this date. Please notify the transferee of this transfer and of the terms and conditions of the Letter of Credit as transferred. This transfer will not become effective until the transferee is so notified.

Very truly yours,

[insert name of transferor]

By:

Name:

Title:

Signature of Transferor Guaranteed

[insert name of bank]

By:

Name:

Title:

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EX-10.25

EXHIBIT 10.25

LEASE AGREEMENT

This Lease, made this 1st day of October, 2006 between El Camino Center, a California Limited Partnership, hereinafter called Landlord, and Danger, Inc., a California corporation, hereinafter called Tenant.

WITNESSETH:

Landlord hereby leases to Tenant and Tenant hereby hires and takes from Landlord those certain premises (the “Premises”) outlined in red on Exhibit “A”, attached hereto and incorporated herein by this reference thereto more particularly described as follows:

Approximately 18,850 square feet of rentable space commonly known as 380 Portage Avenue, Palo Alto, County of Santa Clara, California.

As used herein the Complex shall mean and include all of the land outlined in red and described in Exhibit “B”, attached hereto, and all of the buildings, improvements, fixtures and equipment now or hereafter situated on said land. The Building shall mean the building in which the Premises are located.

Landlord agrees to provide for the improvement of the Premises upon such terms and conditions as set forth in Exhibit “C”, attached hereto and incorporated herein by this reference thereto.

Said letting and hiring is upon and subject to the terms, covenants and conditions hereinafter set forth and Tenant covenants as a material part of the consideration for this Lease to perform and observe each and all of said terms, covenants and conditions. This Lease is made upon the conditions of such performance and observance.

1. USE Tenant shall use the Premises only in conformance with applicable governmental laws, regulations, rules and ordinances for the purpose of general, office, and other related legal uses. Tenant shall not do or permit to be done in or about the Premises or the Complex nor bring or keep or permit to be brought or kept in or about the Premises or the Complex anything which is prohibited by or will in any way increase the existing rate of (or otherwise affect) fire or any insurance covering the Complex or any part thereof, or any of its contents, or will cause a cancellation of any insurance covering the Complex or any part thereof, or any of its contents. Tenant shall not do or permit to be done anything in, on or about the Premises or the Complex which will in any way obstruct or interfere with the rights of other tenants or occupants of the Complex or injure or annoy them, or use or allow the Premises to be used for any improper, immoral, unlawful purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about the Premises or the Complex. No sale by auction shall be permitted on the Premises. Tenant shall not place any loads upon the floors, walls, or ceiling, which endanger the structure, or place any harmful fluids or other materials in the drainage system of the building, or overload existing electrical or other mechanical systems. No waste materials or refuse shall be dumped upon or permitted to remain upon any part of the Premises or outside of the building in which the Premises are a part, except in trash containers placed inside exterior enclosures designated by Landlord for that purpose or inside of the building proper where designated by Landlord. No materials, supplies, equipment, finished products or semi-finished products, raw materials or articles of any nature shall be stored upon or permitted to remain outside the Premises or on any portion of common area of the Complex. No loudspeaker or other device, system or apparatus which can be heard outside the Premises shall be used in or at the Premises without the prior written consent of Landlord. Tenant shall not commit or suffer to be committed any waste in or upon the Premises. Tenant shall indemnify, defend and hold Landlord harmless against any loss, expense, damage, attorney’s fees, or liability arising out of failure of Tenant to comply with any applicable law. Except as expressly set forth in this Lease, Tenant shall not use the Premises for any use or purpose contrary to applicable law now or hereinafter in effect. Tenant shall comply with any recorded covenant, condition, or restriction (“CC&R’s”) affecting the Premises; provided however, Landlord agrees not to enter into any future CC&R’s that would adversely affect Tenant’s rights hereunder or materially increase Tenant’s obligations hereunder. The provisions of this paragraph are for the benefit of Landlord only and shall not be construed to be for the benefit of any tenant or occupant of the Complex.

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2. TERM

A. The term of this Lease shall be for a period of approximately Five ( 5 ) years and three ( 3 ) months (unless sooner terminated as hereinafter provided) and, subject to Paragraphs 2(B) and 3, shall commence on the Commencement Date and shall expire on the 31^st day of December, 2011 (the “Expiration Date”), subject to earlier termination or extension as herein provided.

B. Possession of the Premises shall be deemed tendered and the term of this Lease shall commence when the first of the following occurs (the “Commencement Date”):

(1) One day after mutual execution of this Lease.

3. POSSESSION If Landlord, for any reason whatsoever, cannot deliver possession of said Premises to Tenant on the Commencement Date, as hereinbefore specified, this Lease shall not be void or voidable; nor shall the obligation of Tenant shall be affected thereby; nor shall Landlord or Landlord’s agents be liable to Tenant for any loss or damage resulting therefrom; but in that event the Commencement Date shall be revised to conform to the date of Landlord’s delivery of possession, and the Expiration Date shall remain December 31, 2011. Notwithstanding the foregoing, if the delivery of the Premises is later than October 31, 2006 (except those delays caused by Acts of God, strikes, war, utilities, governmental bodies, weather, unavailable materials, and delays beyond Landlord’s control) Tenant, at its option, may, by written notice to Landlord, terminate this Lease. Notwithstanding anything above in Paragraphs 2 or 3, if this Lease is executed anytime between October 1, 2006 and October 30, 2006, the term shall not be adjusted but shall commence one day following the day upon which the Lease has been executed by both parties hereto and shall terminate on December 31, 2011 except as set forth elsewhere in this Lease.

4. RENT

A. Basic Rent. Tenant agrees to pay to Landlord at such place as Landlord may designate without deduction, offset, prior notice, or demand, and Landlord agrees to accept as Basic Rent for the leased Premises the total sum of One Million Seven Hundred Seventy-five Thousand Six Hundred Seventy ($1,775,670.00) Dollars in lawful money of the United States of America, payable as follows:

$0.00	shall be due and payable on or before the first day of September 2006 and on or before the first day of each succeeding month through December 2006.
$22,620.00	shall be due and payable on or before the first day of January 2007 and on or before the first day of each succeeding month through June 2007.
$28,275.00	shall be due and payable on or before the first day of July 2007 and on or before the first day of each succeeding month through December 2007.
$29,217.50	shall be due and payable on or before the first day of January 2008 and on or before the first day of each succeeding month through December 2008.
$30,160.00	shall be due and payable on or before the first day of January 2009 and on or before the first day of each succeeding month through December 2009.
$31,102.50	shall be due and payable on or before the first day of January 2010 and on or before the first day of each succeeding month through December 2010.
$32,045.00	shall be due and payable on or before the first day of January 2011 and on or before the first day of each succeeding month through December 2011.

B. Time for Payment. In the event that the term of this Lease for any reason ends on a date other than the last day of a calendar month, on the first day of the last calendar month of the term hereof Tenant shall pay to Landlord as rent for the period from said first day of said last calendar month to and including the last day of the term hereof that proportion of the monthly rent hereunder which the number of days between said first day of said last calendar month and the last day of the term hereof bears to the actual number of days in such calendar month.

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C. Late Charge. Notwithstanding any other provision of this Lease, if Tenant is in default in the payment of rent as set forth in this Paragraph 4 when due, or any part thereof, Tenant agrees to pay Landlord, in addition to the delinquent rental due, a late charge for each rental payment in default ten (10) days. Said late charge shall equal ten (10%) percent of each rental payment so in default.

D. Additional Rent. Beginning in January 2007, Tenant shall pay to Landlord in addition to the Basic Rent and as Additional Rent the following:

(1) Tenant’s proportionate share of all utilities relating to the Complex as set forth in Paragraph 11, and

(2) Tenant’s proportionate share of all Real Estate Taxes relating to the Complex as set forth in Paragraph 12, and

(3) Tenant’s proportionate share of all insurance premiums relating to the Complex, as set forth in Paragraph 15, and

(4) Tenant’s proportionate share of expenses for the operation, management, maintenance and repair of the Building (including common areas of the Building) and Common Areas of the Complex in which the Premises are located as set forth in Paragraph 7, and

(5) All charges, costs and expenses, which Tenant is required to pay hereunder, together with all interest and penalties, costs and expenses including attorney’s fees and legal expenses, that may accrue thereto in the event of Tenant’s failure to pay such amounts, and all damages, reasonable costs and expenses which Landlord may incur by reason of default of Tenant or failure on Tenant’s part to comply with the terms of this Lease. In the event of nonpayment by Tenant of Additional Rent, Landlord shall have all the rights and remedies with respect thereto as Landlord has for nonpayment of rent.

Tenant shall pay to Landlord monthly, in advance, Tenant’s prorata share of an amount estimated by Landlord to be Landlord’s approximate average monthly expenditure for such Additional Rent items, which estimated amount shall be reconciled in writing {the “Reconciliation Statement”) and provided to Tenant within one hundred fifty (150) days after the end of each calendar year as compared to Landlord’s actual expenditure for said Additional Rent items, with Tenant paying to Landlord, upon demand, any amount of actual expenses expended by Landlord in excess of said estimated amount, or Landlord refunding to Tenant (providing Tenant is not in default in the performance of any of the terms, covenants and conditions of this Lease) any amount of estimated payments made by Tenant in excess of Landlord’s actual expenditures for said Additional Rent items.

Tenant’s payment for such Additional rent as of January 2007 shall be Five Thousand Seven Hundred ($5,700.00) Dollars per month. Any payments required to be made by Tenant for Additional Rent shall be made by check or instrument separate from that check or instrument used by Tenant to make any payments for Basic Rent pursuant to paragraph 4 A.

The respective obligations of Landlord and Tenant accruing under this paragraph prior to the expiration or earlier termination of the Lease shall survive the expiration or other termination of the term of this Lease, and if the term hereof shall expire or shall otherwise terminate on a day other than the last day of a calendar year, the actual Additional Rent incurred for the calendar year in which the term hereof expires or otherwise terminates shall be determined and settled on the basis of the statement of actual Additional Rent for such calendar year and shall be prorated in the proportion which the number of days in such calendar year preceding such expiration or termination bears to 365.

Notwithstanding this Paragraph 4.D, if Tenant occupies the Premises with operating personnel for the conduct of its normal business activities (construction and facilities personnel engaged in preparing the space for Tenant’s occupancy shall not be considered operating personnel) prior to January 2007, Tenant shall immediately upon such occupancy commence payment of Additional Rent prorated as necessary for partial month occupancy based on a monthly estimated Additional Rent payment of $5,700.00. Tenant shall, as of the commencement date of the Lease, be responsible for the cost and expense of all utilities providing service exclusively to the Premises, janitorial service to the Premises, and all other services to be contracted for directly by Tenant as provided for in Paragraph 11 of the Lease.

E. Place of Payment of Rent and Additional Rent. All Basic Rent hereunder and all payments hereunder for Additional Rent shall be paid to Landlord at the office of Landlord c/o

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Robert Wheatley Properties at 3225 Ash Street, Palo Alto, California 94306, or to such other person or to such other place as Landlord may from time to time designate in writing.

F. Tenant’s Audit Right. Landlord shall maintain records respecting Real Estate Taxes, utility and common area maintenance expenses and insurance premiums for the Building and shall determine the same in accordance with sound management practices consistently applied. Tenant or its representative shall have the right to examine such records during normal business hours at the place or places where such records are normally kept upon reasonable prior notice specifying the records Tenant desires to examine, delivered to Landlord no later than ninety (90) days following the furnishing of the Reconciliation Statement. Tenant may take exception to matters included in utility expenses, Taxes, insurance premiums or common area maintenance expenses, or Landlord’s computation of Tenant’s proportionate share of any of the foregoing, by sending notice specifying such exception and the reasons therefor to Landlord no later than sixty (60) days after Tenant’s examination of Landlord’s records pursuant to this Section. If Tenant takes exception to any matter contained in the Reconciliation Statement as provided herein, Landlord shall refer the matter to an independent certified public accountant mutually acceptable to Landlord and Tenant, whose certification as to the proper amount shall be rendered within sixty (60) days and shall be final and conclusive as between Landlord and Tenant. Tenant shall promptly pay the cost of such certification unless such certification determines that Tenant was over-billed by more than five percent (5%). Pending resolution of any such exceptions in the foregoing manner, Tenant shall continue paying Additional Rent in the amounts determined by Landlord, subject to adjustment after any such exceptions are so resolved.

G. Security Deposit. Concurrently with Tenant’s execution of this Lease, Tenant shall deposit with Landlord the sum of Thirty Nine Thousand ($39,000.00) Dollars. Said sum shall be held by Landlord as a Security Deposit for the faithful performance by Tenant of all the terms, covenants, and conditions of this Lease to be kept and performed by Tenant during the term hereof. If, after notice and failure to cure within the time periods set forth in Section 22 hereof, Tenant defaults with respect to any provisions of this Lease, including, but not limited to, the provisions relating to the payment of rent and any of the monetary sums due herewith, Landlord may (but shall not be required to) use, apply or retain all or any part of this Security Deposit for the payment of accrued but unpaid rent plus any other amount which Landlord may spend by reason of Tenant’s default or to compensate Landlord for any other loss or damage which Landlord may suffer by reason of Tenant’s default. If any portion of said Deposit is so used or applied, Tenant shall, within ten (10) days after written demand therefor, deposit cash with Landlord in the amount sufficient to restore the Security Deposit to its original amount. Tenant’s failure to do so shall be a material breach of this Lease. Landlord shall not be required to keep this Security Deposit separate from its general funds, and Tenant shall not be entitled to interest on such Deposit. If Tenant fully and faithfully performs every provision of this Lease to be performed by it, the Security Deposit or any balance thereof shall be returned to Tenant (or at Landlord’s option, to the last assignee of Tenant’s interest hereunder) at the expiration of the Lease term and within forty-five (45) days after Tenant has vacated the Premises. In the event of termination of Landlord’s interest in this Lease, Landlord shall transfer said Deposit to Landlord’s successor in interest whereupon Tenant agrees to release Landlord from liability for the return of such Deposit or the accounting therefore, so long as Landlord’s successor in interest agrees in writing to hold the Security Deposit in accordance with this Section 4.G.

5. RULES AND REGULATIONS AND COMMON AREA Subject to the terms and conditions of this Lease and such Rules and Regulations as Landlord may from time to time prescribe, Tenant and Tenant’s employees, invitees and customers shall, in common with other occupants of the Complex in which the Premises are located, and their respective employees, invitees and customers, and others entitled to the use thereof, have the non-exclusive right to use the access roads, parking areas, and facilities provided and designated by Landlord for the general use and convenience of the occupants of the Complex in which the Premises are located, which areas and facilities are referred to herein as “Common Area” This right shall terminate upon the termination of this Lease. Landlord reserves the right from time to time to make changes in the shape, size, location, amount and extent of Common Area, so long as such changes do not adversely affect access to or visibility of the Premises or materially increase Tenant’s payment for Additional Rent. Landlord further reserves the right to promulgate such reasonable rules and regulations relating to the use of the Common Area, and any part or parts thereof, as Landlord may deem appropriate for the best interests of the occupants of the Complex, and such rules and regulations shall be applied in a nondiscriminatory fashion as

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determined solely by Landlord. The Rules and Regulations shall be binding upon Tenant upon delivery of a copy of them to Tenant, and Tenant shall abide by them and cooperate in their observance. Such Rules and Regulations may be amended by Landlord from time to time, with written notice, and all amendments shall be effective upon delivery of a copy to Tenant. Landlord shall not be responsible to Tenant for the non-performance by any other tenant or occupant of the Complex of any of said Rules and Regulations. To the extent that any of the Rules and Regulations conflict with any of the provisions of this Lease, the latter shall control.

Landlord shall operate, manage and maintain the Common Area of the Building and Complex in good order, condition, and repair. The manner in which the Common Area shall be maintained and the expenditures for such maintenance shall be at the discretion of Landlord comparable to that of prudent landlords of other comparable buildings in the Palo Alto, California area.

6. PARKING Tenant shall have the right (but not the obligation), at no additional expense except as otherwise provided for herein, to use up to sixty-six (66) unreserved parking spaces in the common parking areas of the Complex. Tenant agrees that Tenant, Tenant’s employees, agents, representatives and/or invitees shall not use parking spaces in excess of said spaces allocated to Tenant hereunder. Landlord shall have the right, at Landlord’s sole discretion, to specifically designate the location of Tenant’s parking spaces within the common parking areas of the Complex in the event of a dispute among the tenants occupying the building and/or Complex referred to herein, in which event Tenant agrees that Tenant, Tenant’s employees, agents, representatives and/or invitees shall not use any parking spaces other than those parking spaces specifically designated by Landlord for Tenant’s use. Said parking spaces, if specifically designated by Landlord to Tenant, may be relocated by Landlord at any time, and from time to time. Landlord reserves the right, at Landlord’s sole discretion and upon written notice to Tenant specifying the reasons therefor, to rescind any specific designation of parking spaces, thereby returning Tenant’s parking spaces to the common parking area. Landlord shall give Tenant written notice of any change in Tenant’s parking spaces, but in no event shall Landlord reduce the number of Tenant’s available parking spaces below sixty-six (66). Tenant shall not, at any time, park, or permit to be parked, any trucks or vehicles adjacent to the loading areas so as to interfere in any way with the use of such areas, nor shall Tenant at any time park, or permit the parking of Tenant’s trucks or other vehicles or the trucks and vehicles of Tenant’s suppliers or others, in any portion of the common area not designated by Landlord for such use by Tenant. Tenant shall not park not permit to be parked, any inoperative vehicles or equipment on any portion of the common parking area or other common areas of the Complex. Tenant agrees to assume responsibility for compliance by its employees with the parking provision contained herein. If Tenant or its employees park in other than such designated parking areas, then Landlord may charge Tenant, as an additional charge, and Tenant agrees to pay, ten ($10.00) Dollars per day for each day or partial day each such vehicle is parked in any area other than that designated (Landlord shall promptly notify Tenant of parking violations if Landlord intends to Charge Tenant for such violations so that Tenant will not unknowingly continue to accrue violations. Tenant hereby authorizes Landlord at Tenant’s sole expense to tow away from the Complex any vehicle belonging to Tenant or Tenant’s employees parked in violation of these provisions, or to attach violation stickers or notices to such vehicles. Tenant shall use the parking areas for vehicle parking only, and shall not use the parking areas for storage.

7. EXPENSES OF OPERATION, MANAGEMENT AND MAINTENANCE OF THE COMMON AREAS OF THE COMPLEX, PREMISES AND BUILDING IN WHICH THE PREMISES ARE LOCATED As Additional Rent and in accordance with Paragraph 4 D of this Lease, Tenant shall pay to Landlord Tenant’s proportionate share (calculated on a square footage or other more equitable basis as calculated by Landlord) of all expenses of operation, management, maintenance and repair of the Common Areas of the Complex including, but not limited to, license, permit and inspection fees; security; utility charges associated with exterior landscaping and lighting (including water and sewer charges); all charges incurred in the maintenance of landscaped areas, lakes, parking lots, sidewalks, driveways; maintenance, repair and replacement of all fixtures and electrical, mechanical and plumbing systems; structural elements and exterior surfaces of the buildings; salaries and employee benefits of personnel and payroll taxes applicable thereto; supplies, materials, equipment and tools; the cost of capital expenditures which have the effect of reducing operating expenses, provided, however, that in the event Landlord makes such capital improvements, Landlord shall amortize its investment in said improvements (together with interest at a rate of interest not to exceed the prime rate then being charged by major banks plus two (2) percent on the unamortized balance) as an operating

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expense in accordance with standard accounting practices, provided, that such amortization is not at a rate greater than the anticipated savings in the operating expenses.

As Additional Rent and in accordance with paragraph 4D of this Lease, Tenant shall pay its proportionate share (calculated on a square footage or other more equitable basis as calculated by Landlord) of the cost of operation (including common utilities), management, maintenance and repair of the Premises and the building (including common areas such as lobbies, restrooms, janitor’s closets, hallways, elevators, mechanical and telephone rooms, stairwells, entrances, spaces above the ceilings) in which the Premises are located. To the extent applicable to the Premises the maintenance items herein referred to include, but are not limited to, janitorization, electrical systems (such as outlets, lighting fixtures, lamps, bulbs, tubes, ballasts), heating and airconditioning controls (such as mixing boxes, thermostats, time clocks, supply and return grills), all interior improvements within the Premises including but not limited to: wall coverings, window coverings, acoustical ceilings, vinyl tile, carpeting, partitioning, doors (both interior and exterior, including closing mechanisms, latches, locks), and all other interior improvements of any nature whatsoever, all windows, window frames, plate glass, glazing, truck doors, main plumbing systems of the building (such as water and drain lines, sinks, toilets, faucets, drains, showers and water fountains), main electrical systems (such as panels and conduits), heating and air conditioning systems (such as compressors, fans, air handlers, ducts, boilers, heaters), store fronts, roofs, downspouts, building common area interiors (such as wall coverings, window coverings, floor coverings and partitioning), ceilings, building exterior doors, skylights (if any), automatic fire extinguishing systems and elevators; license, permit, and inspection fees; security; salaries and employee benefits of personnel and payroll taxes applicable thereto; supplies, materials, equipment and tools; the cost of capital expenditures which have the effect of reducing operating expenses, provided, however, that in the event Landlord makes such capital improvements, Landlord shall amortize its investment in said improvements (together with interest at a rate of interest not to exceed the prime rate then being charged by major banks plus two (2) percent on the unamortized balance) as an operating expense in accordance with standard accounting practices, provided, that such amortization is not at a rate greater than the anticipated savings in the operating expenses. Tenant hereby waives all rights under, and benefits of, subsection 1 of Section 1932 and Section 1941 and 1942 of the California Civil Code and under any similar law, statute or ordinance now or hereafter in effect. Tenant agrees to provide carpet shields under all rolling chairs or to otherwise be responsible for wear and tear of the carpet caused by such rolling chairs if such wear and tear exceeds that caused by normal foot traffic in surrounding areas. Areas of excessive wear shall be replaced at Tenant’s sole expense upon Lease termination.

Notwithstanding the foregoing, “Additional Rent” as used herein shall not include Landlord’s debt repayments; interest on charges; expenses directly or indirectly incurred by Landlord for the benefit of any other tenant; cost for the installation of partitioning or any other tenant improvements; cost of attracting tenants (including, without limitation, leasing commissions, advertising and marketing expenses); depreciation; interest, or executive salaries, nor shall “Additional Rent” include the following items: (i) costs of a capital nature, including but not limited to capital improvements and alterations, capital repairs, capital equipment, and capital tools as determined in accordance with generally accepted accounting principles, except as specifically set forth in this Section 7, (iii) loan fees, interest and principal payments or like carrying costs on loans, (iv) ground rental payments, (v) costs reimbursed by insurance proceeds (excluding deductible amounts which may be included), (vi) attorneys’ fees, costs, disbursements, and other expenses incurred in connection with negotiations or disputes with tenants, or in connection with leasing, renovating, or improving space for tenants or other occupants or prospective tenants or other occupants of the Complex, (vii) costs with respect to the creation of a mortgage or a superior lease or in connection with a sale of the Building or Complex, (viii) costs incurred due to violations by any tenant in the Complex, of the terms and conditions of any lease, (ix) penalties and interest for late payment of any obligation of Landlord, (x) Landlord’s corporate general overhead or corporate general administrative expenses (Landlord’s property manager’s management fee shall be included), (xi) costs of any service sold to any tenant (including Tenant) or other occupant for which Landlord is entitled to be reimbursed as an additional charge or rental over and above the basic rent and escalations payable under the lease with that tenant, (xii) overhead profit increments paid to Landlord’s subsidiaries or affiliates for management or other services on or to the building or for supplies or other materials to the extent that the cost of the services, supplies, or materials exceeds the cost that would have been paid had the services, supplies, or materials been provided by unaffiliated parties on a competitive basis, (xiii) any compensation paid to clerks, attendants, or other persons in commercial concessions operated by Landlord (this shall not be construed to exclude any of

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Landlord’s property manager’s personnel providing services at the Complex), (xiv) any costs, fines, or penalties incurred due to violations by Landlord of any governmental rule or authority, this Lease or any other lease in the Complex, or due to Landlord’s negligence or willful misconduct, (xv) the cost of correcting any building code violations which were violations prior to the Commencement Date of this Lease, (xvi) the cost of containing, removing, or otherwise remediating any contamination of the Complex (including the underlying land and ground water) by any toxic or hazardous materials (including, without limitation, asbestos and “PCB’s”) where such contamination was not caused by Tenant, (xvii) costs for sculpture, paintings, or other objects of art (and insurance thereon or extraordinary security in connection therewith), and (xviii) any other expense not provided for in the Lease that under generally accepted accounting principles and practices consistently applied would not be considered a normal maintenance or operating expense.

Tenant agrees to provide five-day janitorial service for the leased Premises and Landlord agrees to maintain the Complex in a first-class manner.

8. ACCEPTANCE AND SURRENDER OF PREMISES Except as expressly provided herein, by entry hereunder, Tenant accepts the Premises as being in good and sanitary order, condition and repair and accepts the Building and improvements included in the Premises in their present condition and without representation or warranty by Landlord as to the condition of such Building or as to the use or occupancy which may be made thereof. Any exceptions to the foregoing must be by written agreement executed by Landlord and Tenant.

Notwithstanding anything to the contrary in this Lease, Landlord, to the best of Landlord’s knowledge on the Commencement Date represents that (a) the Premises in all material aspects comply with all laws, codes, ordinances and other governmental requirements then applicable to the Premises (b) the Premises are structurally sound and water tight, (c) the Premises, including the improvements and equipment (including the roof, HVAC, plumbing, electrical, lighting, mechanical and life safety systems) therein, are in good working order, condition, and repair, and (d) the Premises are free of contamination by any petroleum, asbestos, PCB’s, or radioactive materials or any other hazardous or toxic substances then regulated by any applicable local, state, or federal law (Tenant represents that it is aware that Hazardous Materials have been found in the groundwater in the area in which the Complex is located and that Landlord has previously remediated soil contamination from a previous tenant of the Complex and that, while not accepting responsibility for any contamination preceding Tenant’s occupancy, Tenant has conducted any investigations it deems necessary relative to Hazardous Materials). In the event of any breach of any of the foregoing warranties, Landlord shall promptly rectify the same at its sole cost and expense. Tenant shall have until sixty (60) days after its occupancy of the Premises for the purpose of conducting its normal business activities to notify Landlord of any breach of the representations in (a), (b) , and (c) above. There shall be no time limit on Tenant’s notification of Landlord as to a breach of the representation set forth in (d) above.

Tenant agrees on the last day of the Lease term, or on the sooner termination of this Lease, to surrender the Premises promptly and peaceably to Landlord in good condition and repair (casualty not caused by or contributed to by Tenant, condemnation, maintenance obligations of Landlord or normal wear and tear excepted), with all interior walls painted, or cleaned so that they appear freshly painted, and repaired, if damaged; all floors cleaned and waxed; all carpets cleaned and shampooed; the air conditioning and heating equipment serviced by a reputable and licensed service firm and in good operating condition (provided the maintenance of such equipment has been Tenant’s responsibility during the term of this Lease) together with all alterations, additions and improvements which may have been made in, to, or on the Premises (except movable trade fixtures installed at the expense of Tenant) except that Tenant shall ascertain from Landlord at the time it makes an alteration (or at the time it requests Landlord’s consent to an alteration, if such consent is required under Section 9) whether Landlord desires to have such alteration removed and the damage caused by such alteration and removal repaired and if Landlord shall so desire, then Tenant shall remove such alteration and make such repairs before the end of this Lease at Tenant’s sole cost and expense. Tenant, on or before the end of the term or sooner termination of this Lease, shall remove all of Tenant’s personal property and trade fixtures from the Premises, and all property not so removed on or before the end of the term or sooner termination of this Lease shall be deemed abandoned by Tenant and title to same shall thereupon pass to Landlord without compensation to Tenant. Landlord may, upon termination of this Lease, remove all moveable furniture and equipment so abandoned by Tenant, at Tenant’s sole cost, and repair any damage caused by such removal at Tenant’s sole

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cost. If the Premises be not surrendered at the end of the term or sooner termination of this Lease, Tenant shall indemnify Landlord against loss or liability resulting from the delay by Tenant in so surrendering the Premises including, without limitation, any claims made by any succeeding tenant founded on such delay. Nothing contained herein shall be construed as an extension of the term hereof or as a consent of Landlord to any holding over by Tenant. The voluntary or other surrender of this Lease or the Premises by Tenant or a mutual cancellation of this Lease shall not work as a merger and, at the option of Landlord, shall either terminate all or any existing subleases or subtenancies or operate as an assignment to Landlord of all or any such subleases or subtenancies.

9. ALTERATIONS AND ADDITIONS Tenant shall not make, or suffer to be made, any alteration or addition to the Premises, or any part thereof, without the written consent of Landlord first had and obtained by Tenant, but at the cost of Tenant, and any addition to, or alteration of, the Premises, except moveable furniture and trade fixtures, shall at once become a part of the Premises and belong to Landlord. If Landlord consents to the making of any alteration, addition, or improvement to or of the Premises by Tenant, the same shall be made by Tenant at Tenant’s sole cost and expense. Any modifications to the building or building systems required by governmental code or otherwise as a result of Tenant’s alterations, additions or improvements shall be made at Tenant’s sole cost and expense. Tenant shall retain title to all moveable furniture and trade fixtures placed in the Premises. All heating, lighting, electrical, airconditioning, partitioning, drapery, carpeting and floor installations made by Tenant, together with all property that has become an integral part of the Premises, shall not be deemed trade fixtures. Tenant agrees that it will not proceed to make any alterations or additions, without having obtained consent from Landlord to do so (which consent shall not be unreasonably withheld or delayed), and until five (5) days from the receipt of such consent, in order that Landlord may post appropriate notices to avoid any liability to contractors or material suppliers for payment for Tenant’s improvements. Tenant will at all times permit such notices to be posted and to remain posted until the completion of work. Tenant shall, if required by Landlord, secure at Tenant’s own cost and expense, a completion and lien indemnity bond, satisfactory to Landlord, for such work. Tenant further covenants and agrees that any mechanic’s liens filed against the Premises or against the Complex for work claimed to have been done for, or materials claimed to have been furnished to Tenant, will be discharged by Tenant, by bond or otherwise, within ten (10) days after the filing thereof, at the cost and expense of Tenant. Any exceptions to the foregoing must be made in writing and executed by both Landlord and Tenant. Notwithstanding anything to the contrary in this Section 9, Tenant shall be permitted to make non-structural interior alterations and additions reasonably valued at less than Five Thousand ($5,000.00) dollars (separate projects done the same general time frame shall be reasonably construed to be one project for purposes of this exception) without first obtaining Landlord’s written permission but with reasonably detailed notice to Landlord describing the work, the location of the work within the Premises and plans if any are made adequate to be able to determine the extent of the alterations and additions performed by Tenant; all such alterations and additions done without having first obtained Landlord’s written consent shall be removed and the damage caused by such alteration and removal repaired before the end of this Lease at Tenant’s sole cost and expense unless such requirement is specifically waived by Landlord in writing prior to the expiration of the Lease.

10. BUILDING PLANNING In the event Landlord requires the Premises for use in conjunction with another suite or for other reasons connected with the building planning program, Landlord, upon notifying Tenant in writing, shall have the right to move Tenant to space in the Complex of which the Premises form a part (said space shall be substantially the same size or larger as the Premises with substantially the same quality of leasehold improvements and Tenant’s moving costs shall include reprinting of Tenant’s stationary and business cards to reflect the new location and Tenant’s move shall be accomplished in a manner as to cause Tenant minimal disruption as reasonably possible to Tenant’s ongoing business operation), at Landlord’s sole cost and expense, and the terms and conditions of the original lease shall remain in full force and effect, save and excepting that the Premises shall be in a new location. However, if the new space does not meet with Tenant’s approval, Tenant shall have the right to cancel said Lease upon giving Landlord thirty (30) days written notice within ten (10) days of receipt of Landlord’s notification.

11. UTILITIES OF THE BUILDING IN WHICH THE PREMISES ARE LOCATED Tenant shall contract for electric, refuse, and gas service exclusively serving the Premises and

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pay for the same directly to the City of Palo Alto. Tenant shall also pay directly to providers selected by Tenant the cost of all telephone, data, alarm, or electronic communications services. As Additional Rent and in accordance with paragraph 4D of this Lease, Tenant shall pay its proportionate share (calculated on a square footage or other more equitable basis as calculated by Landlord) of the cost of all common utility charges such as water, gas, electricity, electronic communications service, sewer service, and any other utilities, materials or services furnished directly to the building in which the Premises are located, including, without limitation, any temporary or permanent utility surcharge or other exactions whether or not hereinafter imposed.

Landlord shall not be liable for and Tenant shall not be entitled to any abatement or reduction of rent by reason of any interruption or failure of utility services to the Premises when such interruption or failure is caused by accident, breakage, repair, strikes, lockouts or other labor disturbances or labor disputes of any nature, or by any other cause, similar or dissimilar, beyond the reasonable control of Landlord. Notwithstanding the foregoing, in the event that Tenant’s use of the Premises is substantially impaired for seven (7) consecutive days due to reasons within the Landlord’s reasonable control, including, without limitation, disruption in services or loss of total access to the Premises, then Tenant shall be entitled to an equitable abatement of rent commencing on the eighth (8th) day to the extent of the interference with Tenant’s use of the Premises occasioned thereby.

Provided that Tenant is not in default in the performance or observance of any of the terms, covenants or conditions of this Lease to be performed or observed by it (or Tenant has cured said default within the time periods set forth in Section 22 hereof), Landlord shall furnish to the Premises subject to the rules and regulations of the Complex hereinbefore referred to, reasonable quantities of water required in Landlord’s judgement for the comfortable use and occupation of the Premises for such purposes. Tenant agrees that at all times it will cooperate fully with Landlord and abide by all regulations and requirements that Landlord may prescribe for the proper functioning and protection of the building fire protection, heating, ventilating and airconditioning systems. Tenant will not, without the written consent of Landlord, use any apparatus or device in the Premises which will materially increase the amount of water usually furnished or supplies to premises being used as general office space. If Tenant shall require water in excess of that usually furnished or supplied to premises being used as general office space, Tenant shall first obtain the written consent of Landlord, which consent shall not be unreasonably withheld and Landlord may cause a water meter to be installed in the Premises in order to measure the amount of water consumed for any such excess use. The cost of any such meter and of the installation, maintenance and repair thereof, all charges for such excess water consumed (as shown by such meters and at the rates then charged by the furnishing public utility); and any additional expense incurred by Landlord in keeping account of water so consumed shall be paid by Tenant, and Tenant agrees to pay Landlord therefor promptly upon demand by Landlord.

12. TAXES

A. As Additional Rent and in accordance with paragraph 4D of this Lease, Tenant shall pay to Landlord Tenant’s proportionate share of all Real Property Taxes, which prorata share shall be allocated to the leased Premises by square footage or other more equitable basis, as calculated by Landlord. The term “Real Property Taxes”, as used herein, shall mean (i) all taxes, assessments, levies and other charges of any kind or nature whatsoever, general and special, foreseen and unforeseen (including all installments of principal and interest required to pay any general or special assessments for public improvements and any increases resulting from reassessments caused by any change in ownership of the Complex) now or hereafter imposed by any governmental or quasi-governmental authority or special district having the direct or indirect power to tax or levy assessments, which are levied or assessed against, or with respect to the value, occupancy or use of, all or any portion of the Complex (as now constructed or as may at any time hereafter be constructed, altered, or otherwise changed) or Landlord’s interest therein; any improvements located within the Complex (regardless of ownership); the fixtures, equipment and other property of Landlord, real or personal, that are an integral part of and located in the Complex; or parking areas, public utilities, or energy within the Complex; (ii) all charges, levies or fees imposed by reason of environmental regulation or other governmental control of the Complex; and (iii) all costs and fees (including attorney’s fees) incurred by Landlord in contesting any Real Property Tax and in negotiating with public authorities as to any Real Property Tax. If at any time during the term of this Lease the taxation or assessment of the Complex prevailing as of the commencement date of this Lease shall be altered so that in lieu of or in addition to any Real Property Tax described above there shall be levied, assessed or imposed (whether by reason of a change in the method of taxation or assessment, creation of a

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new tax or charge, or any other cause) an alternate or additional tax or charge (i) on the value, use or occupancy of the Complex or Landlord’s interest therein or (ii) on or measured by the gross receipts, income or rentals from the Complex, on Landlord’s business of leasing the Complex, or computed in any manner with respect to the operation of the Complex, then any such tax or charge, however designated, shall be included within the meaning of the term “Real Property Taxes” for purposes of this Lease. If any Real Property Tax is based upon property or rents unrelated to the Complex, then only that part of such Real Property Tax that is fairly allocable to the Complex shall be included within the meaning of the term “Real Property Taxes”. Notwithstanding the foregoing, the term “Real Property Taxes” shall not include estate, inheritance, gift or franchise taxes of Landlord or the federal or state net income tax imposed on Landlord’s income from all sources.

B. Taxes on Tenant’s Property

(1) Tenant shall be liable for and shall pay ten days before delinquency, taxes levied against any personal property or trade fixtures placed by Tenant in or about the Premises. If any such taxes on Tenant’s personal property or trade fixtures are levied against Landlord or Landlord’s property or if the assessed value of the Premises is increased by the inclusion therein of a value placed upon such personal property or trade fixtures of Tenant and if Landlord, after written notice to Tenant, pays the taxes based on such increased assessment, which Landlord shall have the right to do regardless of the validity thereof, but only under proper protest if requested by Tenant, Tenant shall upon demand, as the case may be, repay to Landlord the taxes so levied against Landlord, or the proportion of such taxes resulting from such increase in the assessment; provided that in any such event Tenant shall have the right, in the name of Landlord and with Landlord’s full cooperation, to bring suit in any court of competent jurisdiction to recover the amount of any such taxes so paid under protest, and any amount so recovered shall belong to Tenant.

(2) If the Tenant improvements in the Premises, whether installed, and/or paid for by Landlord or Tenant and whether or not affixed to the real property so as to become a part thereof, are assessed for Real Property Tax purposes at a valuation higher than the valuation at which standard office improvements in other space in the Complex are assessed, then the Real Property Taxes and assessments levied against Landlord or the Complex by reason of such excess assessed valuation shall be deemed to be taxes levied against personal property of Tenant and shall be governed by the provisions of 12A(i), above. If the records of the County Assessor are available and sufficiently detailed to serve as a basis for determining whether said Tenant improvements are assessed at a higher valuation than standard office improvements in other space in the Complex, such records shall be binding on both the Landlord and the Tenant. If the records of the County Assessor are not available or sufficiently detailed to serve as a basis for making said determination, the actual cost of construction shall be used.

13. LIABILITY INSURANCE Tenant, at Tenant’s expense, agrees to keep in force during the term of this Lease a policy of commercial general liability with limits of $2, 000,000 per occurrence/$3, 000,000 aggregate (including excess liability policies if any) for bodily injury, property damage and personal injury occurring in, on or about the Premises or Complex. The policy or policies affecting such insurance, certificates of which shall be furnished to Landlord, shall name Landlord as additional insured, and shall insure against the acts or omissions of Tenant, its agents, employees or invitees or otherwise by any conduct or transactions of any of said persons in or about or concerning the Premises, including any failure of Tenant to observe or perform any of its obligations hereunder; shall be issued by an insurance company admitted to transact business in the State of California; and shall provide that the insurance effected thereby shall not be canceled, except upon thirty (30) days’ prior written notice to Landlord. If, during the term of this Lease, in the considered opinion of Landlord’s Lender, insurance advisor or counsel, the amount of insurance described in this paragraph 13 is not adequate, Tenant agrees to increase said coverage to such reasonable amount as Landlord’s Lender, insurance advisor or counsel shall reasonably deem adequate.

14. TENANT’S PERSONAL PROPERTY INSURANCE AND WORKER’S COMPENSATION INSURANCE Tenant shall maintain a policy or policies of fire and property damage insurance in “Special Form” form with a sprinkler leakage endorsement insuring the personal property, inventory, trade fixtures and leasehold improvements within the leased Premises for the full replacement value thereof. The proceeds from any of such policies shall be used for the repair or replacement of such items so insured.

Tenant shall also maintain a policy or policies of worker’s compensation insurance and any other employee benefit insurance sufficient to comply with all laws.

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Landlord and Tenant each carry property insurance as required by Paragraphs 15 and 14 of the Lease respectively whereby Landlord insures the Premises and Tenant insures the contents of the Premises as more particularly described therein. Notwithstanding the language of Paragraph 14 of the Lease which states that Landlord shall have no interest in Tenant’s insurance proceeds, if Tenant elects to purchase and keep in force a policy or policies of property insurance coverage for tenant improvements constructed and/or paid for by Tenant consisting of alterations or additions to the Premises which would reasonably be construed to “at once become a part of the Premises and belong to Landlord” as stated in Paragraph 9 of the Lease (“Tenant Alterations”), then Tenant shall, upon issuance of said policy or policies of property insurance, issue a certificate of insurance to Landlord showing the type and amount of coverage in place on said Tenant Alterations and naming Landlord as a “Loss Payee” to ensure Landlord access to said funds as appropriate for rebuilding of the Premises in the event of damage to or destruction of said Tenant Alterations. As to Tenant Alterations only (but not including other parts of the Premises or Complex), Tenant’s policy or policies of insurance shall be considered primary and shall be exhausted prior to application of coverage under Landlord’s policies of insurance. Landlord shall not have any rights against Tenant’s insurance proceeds for reimbursement to Tenant for the cost of Tenant’s personal property, inventory, or trade fixtures.

15. PROPERTY INSURANCE Landlord shall purchase and keep in force and, as Additional Rent and in accordance with Paragraph 4D of this Lease, Tenant shall pay to Landlord Tenant’s proportionate share (calculated on a square footage or other equitable basis as calculated by Landlord) of the cost of policy or policies of insurance covering loss or damage to the Premises and Complex in the amount of the full replacement value thereof, providing protection against those perils included within the classification of “Special Form” insurance and flood and/or earthquake insurance, if available, plus a policy of rental income insurance in the amount of one hundred (100%) percent of twelve (12) months Basic Rent, plus sums paid as Additional Rent. If such insurance cost is increased due to Tenant’s use of the Premises or the Complex, Tenant agrees to pay to Landlord the full cost of such increase. Tenant shall have no interest in nor any right to the proceeds of any insurance procured by Landlord for the Complex.

Landlord and Tenant do each hereby respectively release the other, to the extent of insurance coverage of the releasing party (or to the extent there would have been such coverage had such party carried the insurance required hereunder), from any liability for loss or damage caused by fire or any of the extended coverage casualties included in the releasing party’s insurance policies, irrespective of the cause of such fire or casualty; provided, however, that if the insurance policy of either releasing party prohibits such waiver, then this waiver shall not take effect until consent to such waiver is obtained. If such waiver is so prohibited, the insured party affected shall promptly notify the other party thereof.

16. INDEMNIFICATION Landlord shall not be liable to Tenant and Tenant hereby waives all claims against Landlord for any injury to or death of any person or damage to or destruction of property in or about the Premises or the Complex by or from any cause whatsoever, including, without limitation, gas, fire, oil, electricity or leakage of any character from the roof, walls, basement or other portion of the Premises or the Complex but excluding, however, the negligence of Landlord, its agents, servants, employees, invitees, or contractors. Except as to injury to persons or damage to property the principal cause of which is the negligence of Landlord, Tenant shall hold Landlord harmless from and defend Landlord against any and all expenses, including reasonable attorney’s fees, in connection therewith, arising out of any injury to or death of any person or damage to or destruction of property occurring in, on or about the Premises, or any part thereof, from any cause whatsoever.

17. COMPLIANCE Tenant, at its sole cost and expense, shall promptly comply with all laws, statutes, ordinances and governmental rules, regulations or requirements now or hereafter in effect; with the requirements of any board of fire underwriters or other similar body now or hereafter constituted; and with any direction or occupancy certificate issued pursuant to law by any public officer; provided, however, that no such failure shall be deemed a breach of these provisions if Tenant, immediately upon notification, commences to remedy or rectify said failure. The judgment of any court of competent jurisdiction or the admission of Tenant in any action against Tenant, whether Landlord be a party thereto or not, that Tenant has violated any such law, statute, ordinance or governmental rule, regulation, requirement, direction or provision, shall be conclusive of that fact as between Landlord and Tenant. Notwithstanding the foregoing or anything to the contrary contained in this Lease, Tenant shall not be responsible for compliance with any laws, codes, ordinances or other governmental directives where such compliance is not related specifically to Tenant’s use, alteration, or occupancy of the Leased

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Premises. For example, if any governmental authority should require any portion of the Complex or the Premises to be structurally strengthened against earthquake, or should require the removal of Hazardous Materials from the Premises and such measures are imposed as a general requirement applicable to all tenants rather than as a condition to Tenant’s specific use, alteration, or occupancy of the leased Premises, such work shall be performed by and at the sole cost of Landlord. Tenant shall, at its sole cost and expense, comply with any and all requirements pertaining to said Premises, of any insurance organization or company, necessary for the maintenance of reasonable fire and public liability insurance covering the Premises.

18. LIENS Tenant shall keep the Premises and the Complex free from any liens arising out of any work performed, materials furnished or obligation incurred by Tenant. In the event that Tenant shall not, within ten (10) days following the imposition of such lien, cause the same to be released of record, Landlord shall have, in addition to all other remedies provided herein and by law, the right, but no obligation, to cause the same to be released by such means as it shall deem proper, including payment of the claim giving rise to such lien. All sums paid by Landlord for such purpose, and all expenses incurred by it in connection therewith, shall be payable to Landlord by Tenant on demand with interest at the prime rate of interest as quoted by the Bank of America.

19. ASSIGNMENT AND SUBLETTING Tenant shall not assign, transfer or hypothecate the leasehold estate under this Lease, or any interest therein, and shall not sublet the Premises, or any part thereof, or any right or privilege appurtenant thereto, or suffer any other person or entity to occupy or use the Premises, or any portion thereof, without, in each case, the prior written consent of Landlord which consent will not be unreasonably withheld, conditioned, or delayed. As a reasonable condition for granting its consent to any subletting, Landlord may require that Tenant agrees to pay to Landlord, as additional rent, 50% of all rents received by Tenant from its subtenants in excess of the rent payable by Tenant to Landlord hereunder, after Tenant first deducts its reasonable costs directly attributable to the sublease. Tenant shall, by one hundred twenty (120) days’ written notice, advise Landlord of its intent to sublet the Premises or any portion thereof for any part of the term hereof. If Tenant gives notice to sublet all or substantially all of the Premises, then upon receipt of said notice, Landlord may, in its sole discretion, elect to terminate this Lease as to the portion of the Premises described in Tenant’s notice on the date specified in Tenant’s notice. If Tenant intends to sublet the entire Premises and Landlord elects to terminate this Lease, this Lease shall be terminated on the date specified in Tenant’s notice. If, however this Lease shall terminate pursuant to the foregoing with respect to less than all the Premises, the rent, as defined and reserved hereinabove shall be adjusted on a pro-rata basis to the number of square feet retained by Tenant, and this Lease as so amended shall continue in full force and effect. In the event Tenant is allowed to assign, transfer or sublet the whole or any part of the Premises, with the prior written consent of Landlord, no assignee, transferee or subtenant shall assign or transfer this Lease, either in whole or in part, or sublet the whole or any part of the premises, without also having obtained the prior written consent of Landlord. A consent of Landlord to one assignment, transfer, hypothecation, subletting, occupation or use by any other person shall not release Tenant from any of Tenant’s obligations hereunder or be deemed to be a consent to any subsequent similar or dissimilar assignment, transfer, hypothecation, subletting, occupation or use by any other person. Any such assignment, transfer, hypothecation, subletting, occupation or use without such consent shall be void and shall constitute a breach of this Lease by Tenant and shall, at the option of Landlord exercised by written notice to Tenant, terminate this Lease. The leasehold estate under this Lease shall not, nor shall any interest therein, be assignable for any purpose by operation of law without the written consent of Landlord. As a condition to its consent, Landlord may require Tenant to pay all reasonable expenses in connection with the assignment, and Landlord may require Tenant’s assignee or transferee (or other assignees or transferees) to assume in writing all of the obligations under this Lease and for Tenant to remain liable to Landlord under the Lease. Notwithstanding this Paragraph 19, Landlord’s consent shall not be required for any assignment or subletting to (i) an entity controlled by, under the control of, or under common control with Tenant (ii) an entity with which Tenant may merge or consolidate or (iii) an entity acquiring all or substantially all of Tenant’s assets (each a “Permitted Transferee”); nevertheless, Tenant shall, upon any such assignment or subletting to a Permitted Transferee, give notice to Landlord as soon practically possible and in sufficient detail so that Landlord has the name, entity type, relationship to Tenant, business address, and other pertinent information relating to the assignee or subtenant Notwithstanding anything herein to the contrary, a change in the control of Tenant

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shall not be deemed an assignment or subletting requiring the consent of Landlord, but Tenant shall notify Landlord, as soon as practicable, of such change in control.

20. SUBORDINATION AND MORTGAGES In the event Landlord’s title or leasehold interest is now or hereafter encumbered by a deed of trust, upon the interest of Landlord in the land and buildings in which the demised Premises are located, to secure a loan from a lender (hereinafter referred to as “Lender”) to Landlord, Tenant shall, at the request of Landlord or Lender, execute in writing an agreement subordinating its rights under this Lease to the lien of such deed of trust, or, if so requested, agreeing that the lien of Lender’s deed of trust shall be or remain subject and subordinate to the rights of Tenant under this Lease. If Tenant does not execute said subordination agreement within five (5) business days of delivery to Tenant, then Tenant hereby irrevocably appoints Landlord the attorney in fact of Tenant to execute, deliver and record any such instrument or instruments for and in the name and on behalf of Tenant. Notwithstanding the foregoing, Landlord agrees to provide Tenant with commercially reasonable nondisturbance agreement(s) in favor of Tenant (if Tenant is not in default and so long as Tenant shall pay all rent and observe and perform all of the provisions set forth in this Lease) from any and all ground or underlying leases and any liens of mortgages or deeds of trust of Landlord now existing or who later come(s) into existence at any time prior to the expiration of the term of the Lease, as it may be extended, in consideration of, and as a condition precedent to, Tenant’s agreement to be bound by this Section 20. Said nondisturbance agreements shall be in recordable form and may be recorded at Tenant’s election and expense. Tenant agrees to send to any mortgagees and/or deed of trust holders, by registered mail, a copy of any notice of default served by Tenant upon the Landlord, provided that prior to such notice, Tenant has been notified, in writing (by way of notice of assignment of rents or otherwise) of the addresses of such mortgages and/or deed of trust holders. Tenant further agrees that if Landlord shall have failed to cure such default within the time provided for in this Lease, any such mortgagees and/or deed of trust holders shall have an additional thirty (30) days within which to cure such default, or if such default is not reasonably susceptible of cure within that time, then such additional time as may be reasonably necessary if within such (30) days, any mortgagee and/or deed of trust holder has commenced and is diligently pursuing the remedies necessary to cure such default, (including but not limited to commencement of foreclosure proceedings), in which event this Lease shall not be terminated when such remedies are being diligently pursued.

21. ENTRY BY LANDLORD Landlord reserves, and shall at all reasonable times upon reasonable notice to Tenant (which may be written, oral, or electronic), but subject at all times to Tenant’s reasonable security requirements (except that no notice or compliance with security measures shall be required in case of emergency), have the right to enter the Premises to inspect them; to perform any services to be provided by Landlord hereunder; to submit the Premises to prospective purchasers, mortgagers or tenants; to post notices of nonresponsibility; and to alter, improve or repair the Premises and any portion of the Complex, all without abatement of rent; and may erect scaffolding and other necessary structures in or through the Premises where reasonably required by the character of the work to be performed; provided, however, that the business of Tenant shall be interfered with to the least extent that is reasonably practical. For each of the foregoing purposes, Landlord shall at all times have and retain a key with which to unlock all of the doors, which shall only be used in case of an emergency in order to obtain entry to the Premises, and any entry to the Premises obtained by Landlord by any of said means, or otherwise, shall not under any circumstances be construed or deemed to be a forcible or unlawful entry into or a detainer of the Premises or an eviction, actual or constructive, of Tenant from the Premises or any portion thereof. Landlord shall also have the right at any time to change the arrangement or location of entrances or passageways, doors and doorways, and corridors, elevators, stairs, toilets or other public parts of the Complex and to change the name, number or designation by which the Complex is commonly known, and none of the foregoing shall be deemed an actual or constructive eviction of Tenant, or shall entitle Tenant to any reduction of rent hereunder. Notwithstanding the foregoing, if Landlord, at Landlord’s discretion and not by order of a government authority having jurisdiction, shall change the name, number, or designation by which the Premises is commonly known, then Landlord shall reimburse Tenant its reasonable costs of replacing its stationary, business cards and marketing materials to reflect such change(s).

22. BANKRUPTCY AND DEFAULT The commencement of a bankruptcy action or liquidation action or reorganization action or insolvency action or an assignment of or by Tenant for the benefit of creditors, or any similar action undertaken by Tenant, or the insolvency of Tenant, shall, at Landlord’s option, constitute a breach of this Lease by Tenant. If the trustee or

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receiver appointed to serve during a bankruptcy, liquidation, reorganization, insolvency or similar action elects to reject Tenant’s unexpired Lease, the trustee or receiver shall notify Landlord in writing of its election within thirty (30) days after an order for relief in a liquidation action or within thirty (30) days after the commencement of any action.

Within thirty (30) days after court approval of the assumption of this Lease, the trustee or receiver shall cure (or provide adequate assurance to the reasonable satisfaction of Landlord that the trustee or receiver shall cure) any and all previous defaults under the unexpired Lease and shall compensate Landlord for all actual pecuniary loss and shall provide adequate assurance of future performance under said Lease to the reasonable satisfaction of Landlord. Adequate assurance of future performance, as used herein, includes, but shall not be limited to: (i) assurance of source and payment of rent, and other consideration due under this Lease; (ii) assurance that the assumption or assignment of this Lease will not breach substantially any provision, such as radius, location, use, or exclusivity provision, in any agreement relating to the above described Premises.

Nothing contained in this section shall affect the existing right of Landlord to refuse to accept an assignment upon commencement of or in connection with a bankruptcy, liquidation, reorganization or insolvency action or an assignment of Tenant for the benefit of creditors or other similar act. Nothing contained in this Lease shall be construed as giving or granting or creating an equity in the demised Premises to Tenant. In no event shall the leasehold estate under this Lease, or any interest therein, be assigned by voluntary or involuntary bankruptcy proceeding without the prior written consent of Landlord. In no event shall this Lease or any rights or privileges hereunder be an asset of Tenant under any bankruptcy, insolvency or reorganization proceedings.

The failure to perform or honor any covenant, condition or representation made under this Lease shall constitute a default hereunder by Tenant upon expiration of the appropriate grace period hereinafter provided. Tenant shall have a period of five (5) days from the date of written notice from Landlord within which to cure any default in the payment of rental or adjustments thereto. Tenant shall have a period of ten (10) days from the date of written notice from Landlord within which to cure any other default under this Lease; provided, however, that if the nature of Tenant’s obligations is such than more than ten (10) days are required for performance, then Tenant shall not be in default if Tenant commences performance within such ten (10) day period and thereafter diligently prosecutes the same to completion. Upon an uncured default of this Lease by Tenant, Landlord shall have the following rights and remedies in addition to any other rights or remedies available to Landlord at law or in equity:

(a) The rights and remedies provided for by California Civil Code Section 1951.2, including but not limited to, recovery of the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of rental loss for the same period that Tenant proves could be reasonably avoided, as computed pursuant to subsection (b) of said Section 1951.2. Any proof by Tenant under subparagraphs (2) and (3) of Section 1951.2 of the California Civil Code of the amount of rental loss that could be reasonably avoided shall be made in the following manner: Landlord and Tenant shall each select a licensed real estate broker in the business of renting property of the same type and use as the Premises and in the same geographic vicinity. Such two real estate brokers shall select a third licensed real estate broker, and the three licensed real estate brokers so selected shall determine the amount of the rental loss that could be reasonably avoided from the balance of the term of this Lease after the time of award. The decision of the majority of said licensed real estate brokers shall be final and binding upon the parties hereto.

(b) The rights and remedies provided by California Civil Code which allows Landlord to continue the Lease in effect and to enforce all of its rights and remedies under this Lease, including the right to recover rent as it becomes due, for so long as Landlord does not terminate Tenant’s right to possession; acts of maintenance or preservation, efforts to relet the Premises, or the appointment of a receiver upon Landlord’s initiative to protect its interest under this Lease shall not constitute a termination of Tenants right to possession.

(c) The right to terminate this Lease by giving notice to Tenant in accordance with applicable law.

(d) The right and power, as attorney-in-fact for Tenant, to enter the Premises and remove therefrom all persons and property, to store such property in a public warehouse or elsewhere at the cost of and for the account of Tenant and to sell such property and apply such proceeds therefrom pursuant to applicable California law. Landlord, as attorney-in-fact for Tenant, may from time to time sublet the Premises or any part thereof for such term or terms (which may extend beyond the term of this Lease) and at such rent and such other terms as Landlord in its sole discretion may deem advisable, with the right to make alterations and repairs

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to the Premises. Upon each subletting, (i) Tenant shall be immediately liable to pay Landlord, in addition to indebtedness other than rent due hereunder, the cost of such subletting, including, but not limited to, reasonable attorney’s fees, and any real estate commissions actually paid, and the cost of such alterations and repairs incurred by Landlord and the amount, if any, by which the rent hereunder for the period of such subletting (to the extent such period does not exceed the term hereof) exceeds the amount to be paid as rent for the Premises for such period or (ii) at the option of Landlord, rents received from such subletting shall be applied first to payment of indebtedness other than rent due hereunder from Tenant to Landlord; second, to the payment of any costs of such subletting and of such alterations and repairs; third to payment of rent due and unpaid hereunder; and the residue, if any, shall be held by Landlord and applied in payment of future rent as the same becomes due hereunder. If Tenant has been credited with any rent to be received by such subletting under option (i) and such rent shall not be promptly paid to Landlord by the subtenant(s), or if such rentals received from such subletting under option (ii) during any month be less than that to be paid during that month by Tenant hereunder, Tenant shall pay any such deficiency to Landlord. Such deficiency shall be calculated and paid monthly. For all purposes set forth in this subparagraph (d), Landlord is hereby irrevocably appointed attorney-in-fact for Tenant, with power of substitution. No taking possession of the Premises by Landlord, as attorney-in-fact for Tenant, shall be construed as an election on its part to terminate this Lease unless a written notice of such intention be given to Tenant. Notwithstanding any such subletting without termination, Landlord may at any time hereafter elect to terminate this Lease for such previous breach.

(e) The right to have a receiver appointed for Tenant upon application by Landlord, to take possession of the Premises and to apply any rental collected from the Premises and to exercise all other rights and remedies granted to Landlord as attorney-in-fact for Tenant pursuant to subparagraph (d) above.

23. ABANDONMENT Tenant shall not abandon the Premises at any time during the term of this Lease; and if Tenant shall abandon or surrender said Premises, or be dispossessed by the process of law, or otherwise, any personal property belonging to Tenant and left on the Premises shall be deemed to be abandoned, at the option of Landlord, except such property as may be mortgaged to Landlord.

24. DESTRUCTION In the event the Premises are destroyed in whole or in part from any cause, Landlord may, at its option:

A. Rebuild or restore the Premises to their condition prior to the damage or destruction, or

B. Terminate this Lease.

If Landlord does not give Tenant notice in writing within thirty (30) days from the destruction of the Premises of its election to either rebuild and restore them, or to terminate this Lease, Landlord shall be deemed to have elected to rebuild or restore them, in which event Landlord agrees, at its expense, promptly to rebuild or restore the Premises to their condition prior to the damage or destruction. Tenant shall be entitled to a reduction in rent while such repair is being made in the proportion that the area of the Premises rendered untenantable by such damage bears to the total area of the Premises. If Landlord does not complete the rebuilding or restoration within one hundred eighty (180) days following the date of destruction (such period of time to be extended for delays caused by the fault or neglect of Tenant or because of Acts of God, acts of public agencies, labor disputes, strikes, fires, freight embargoes, rainy or stormy weather, inability to obtain materials, supplies or fuels, acts of contractors or subcontractors, or delay of the contractors or subcontractors dues to such causes or other contingencies beyond the control of Landlord), then Tenant shall have the right to terminate this Lease by giving fifteen (15) days prior written notice to Landlord. Notwithstanding anything herein to the contrary, Landlord’s obligation to rebuild or restore shall be limited to the building and interior improvements constructed by Landlord as they existed as of the commencement date of the Lease and shall not include restoration of Tenant’s trade fixtures, equipment, merchandise or any improvements, alterations or additions made by Tenant to the Premises, which Tenant shall forthwith replace or fully repair at Tenant’s sole cost and expense provided this Lease is not canceled according to the provisions above.

Notwithstanding anything to the contrary contained in this Section 24, or elsewhere in the Lease, if the Premises or the Building are wholly or partially damaged or destroyed within the final twelve (12) months of the Term of this Lease, or, if an applicable renewal option has been exercised, during the last year of any renewal term, so that Tenant shall be prevented from using the Premises for sixty (60) consecutive days due to such damage or destruction, then either

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Landlord or Tenant may, at its option, by notice to the other party within sixty (60) days after the occurrence of such damage or destruction, elect to terminate the Lease.

Unless this Lease is terminated pursuant to the foregoing provisions, this Lease shall remain in full force and effect. Tenant hereby expressly waives the provisions of Section 1932, Subdivision 2, and Section 1933, Subdivision 4 of the California Civil Code.

In the event that the building in which the Premises are situated is damaged or destroyed to the extent of not less than 33 1/3% of the replacement cost thereof, Landlord may elect to terminate this Lease, whether the Premises be injured or not. In the event the destruction of the Premises is caused by Tenant, Tenant shall pay the deductible portion of Landlord’s insurance proceeds.

25. EMINENT DOMAIN If all or any part of the Premises shall be taken by any public or quasi-public authority under the power of eminent domain or conveyance in lieu thereof, this Lease shall terminate as to any portion of the Premises so taken or conveyed on the date when title vests in the condemnor, and Landlord shall be entitled to any and all payment, income, rent, award or any interest therein whatsoever which may be paid or made in connection with such taking or conveyance, and Tenant shall have no claim against Landlord or otherwise for the value of any unexpired term of this Lease. Notwithstanding the foregoing paragraph, any compensation specifically awarded Tenant for loss of business, Tenant’s personal property, moving cost or loss of goodwill, shall be and remain the property of Tenant.

If (i) any action or proceeding is commenced for such taking of the Premises or any part thereof, or if Landlord is advised in writing by any entity or body having the right or power of condemnation of its intention to condemn the Premises or any portion thereof, or (ii) any of the foregoing events occur with respect to the taking of any space in the Complex not leased hereby, or if any such space is so taken or conveyed in lieu of such taking and Landlord shall decide to discontinue the use and operation of the Complex, or decide to demolish, alter or rebuild the Complex, then in any of such events Landlord shall have the right to terminate this Lease by giving Tenant written notice thereof within sixty (60) days of the date of receipt of said written advice, or commencement of said action or proceeding, or taking or conveyance, which termination shall take place as of the first to occur of the last day of the calendar month next following the month in which such notice is given or the date on which title to the Premises shall vest in the condemnor.

In the event of such a partial taking or conveyance of the Premises, if the portion of the Premises taken or conveyed is so substantial that the Tenant can no longer reasonably conduct its business, Tenant shall have the privilege of terminating this Lease within sixty (60) days from the date of such taking or conveyance, upon written notice to Landlord of its intention so to do, and upon giving of such notice this Lease shall terminate on the last day of the calendar month next following the month in which such notice is given, upon payment by Tenant of the rent from the date of such taking or conveyance to the date of termination.

If a portion of the Premises be taken by condemnation or conveyance in lieu thereof and neither Landlord nor Tenant shall terminate this Lease as provided herein, this Lease shall continue in full force and effect as to the part of the Premises not so taken or conveyed, and the rent herein shall be apportioned as of the date of such taking or conveyance so that thereafter the rent to be paid by Tenant shall be in the ratio that the area of the portion of the Premises not so taken or conveyed bears to the total area of the Premises prior to such taking.

26. SALE OR CONVEYANCE BY LANDLORD In the event of a sale or conveyance of the Complex or any interest therein, by any owner of the reversion then constituting Landlord, the transferor shall thereby be released from any further liability upon any of the terms, covenants or conditions (express or implied) herein contained in favor of Tenant, and in such event, insofar as such transfer is concerned, Tenant agrees to look solely to the responsibility of the successor in interest of such transferor in and to the Complex and this Lease, so long as such successor in interest agrees to assume all of the transferor’s obligations under the Lease. This Lease shall not be affected by any such sale or conveyance, and Tenant agrees to attorn to the successor in interest of such transferor.

27. ATTORNMENT TO LENDER OR THIRD PARTY In the event the interest of Landlord in the land and buildings in which the leased Premises are located (whether such interest of Landlord is a fee title interest or a leasehold interest) is encumbered by deed of trust, and such interest is acquired by the lender or any third party through judicial foreclosure or by exercise of a power of sale at private trustee’s foreclosure sale, Tenant hereby agrees to attorn to the purchaser at any such foreclosure sale and to recognize such purchaser as the Landlord under this Lease. In the event the lien of the deed of trust securing the loan from a Lender to Landlord

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is prior and paramount to the lease, this Lease shall nonetheless continue in full force and effect for the remainder of the unexpired term hereof, at the same rental herein reserved and upon all the other terms, conditions and covenants herein contained.

28. HOLDING OVER Any holding over by Tenant after expiration or other termination of the term of this Lease with the written consent of Landlord delivered to Tenant shall not constitute a renewal or extension of the Lease or give Tenant any rights in or to the leased Premises except as expressly provided in this Lease. Any holding over after the expiration or other termination of the term of this lease, with the consent of Landlord, shall be construed to be a tenancy from month to month, on the same terms and conditions herein specified insofar as applicable except that the monthly Basic Rent shall be increased to an amount equal to one hundred seventy-five (175%) percent of the monthly Basic Rent required during the last month of the Lease term.

29. CERTIFICATE OF ESTOPPEL Tenant shall at any time upon not less than ten (10) days’ prior written notice from Landlord execute, acknowledge and deliver to Landlord a statement in writing (i) certifying that this Lease is unmodified and in full force and effect (or, if modified, stating the nature of such modification and certifying that this Lease, as so modified, is in full force and effect) and the date to which the rent and other charges are paid in advance, if any, and (ii) acknowledging that there are not, to Tenant’s knowledge, any uncured defaults on the part of Landlord hereunder, or specifying such defaults, if any, are claimed. Any such statement may be conclusively relied upon by any prospective purchaser or encumbrancer of the Premises. Tenant’s failure to deliver such statement within such time shall be conclusive upon Tenant that this Lease is in full force and effect, without modifications except as may be represented by Landlord; that there are no uncured defaults in Landlord’s performance, and that not more than one month’s rent has been paid in advance.

30. CONSTRUCTION CHANGES It is understood that the description of the Premises and the location of the ductwork, plumbing and other facilities therein are subject to such minor changes as Landlord or Landlord’s architect determines to be desirable in the course of construction of the Premises, and no such changes, or any changes in plans for any other portions of the Complex shall affect this Lease or entitle Tenant to any reduction of rent hereunder (unless such changes shall reduce the rentable area of the Premises) or result in any liability of Landlord to Tenant. Landlord does not guarantee the accuracy of any drawings supplied to Tenant and verification of the accuracy of such drawings rests with Tenant.

31. RIGHT OF LANDLORD TO PERFORM All terms, covenants and conditions of this Lease to be performed or observed by Tenant shall be performed or observed by Tenant at Tenant’s sole cost and expense and without any reduction of rent. If Tenant shall fail to pay any sum of money, or other rent, required to be paid by it hereunder or shall fail to perform any other term or covenant hereunder on its part to be performed, and such failure shall continue for five (5) days after written notice thereof by Landlord, Landlord, without waiving or releasing Tenant from any obligation of Tenant hereunder, may, but shall not be obligated to, make any such payment or perform any such other term or covenant on Tenant’s part to be performed. All sums so paid by Landlord and all necessary costs of such performance by Landlord together with interest thereon at the rate of the prime rate of interest per annum as then quoted by the Bank of America from the date of such payment of performance by Landlord, shall be paid (and Tenant covenants to make such payment) to Landlord on demand by Landlord, and Landlord shall have (in addition to any other right or remedy of Landlord) the same rights and remedies in the event of non- payment by Tenant as in the case of failure by Tenant in the payment of rent hereunder.

32. ATTORNEYS FEES

A. In the event that either party shall bring suit for the recovery of any sum due under this Lease, or because of the breach of any provision of this Lease, or for any other relief against the other party hereunder, then all costs and expenses, including reasonable attorney’s fees, incurred by the prevailing party therein shall be paid by the other party, which obligation on the part of the other party shall be deemed to have accrued on the date of the commencement of such action and shall be enforceable whether or not the action is prosecuted to judgment.

B. Except as relates to injury to persons or damage to property the principal cause of which is the negligence of Landlord, should Landlord be named as a defendant in any suit brought against Tenant in connection with or arising out of Tenant’s occupancy hereunder, Tenant shall pay to Landlord its costs and expenses incurred in such suit, including a reasonable attorney’s fee.

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33. WAIVER The waiver by either party of the other party’s failure to perform or observe any term, covenant or condition herein contained to be performed or observed by such waiving party shall not be deemed to be a waiver of such term, covenant or condition or of any subsequent failure of the party failing to perform or observe the same or any other such term, covenant or condition therein contained, and no custom or practice which may develop between the parties hereto during the term hereof shall be deemed a waiver of, or in any way affect, the right of either party to insist upon performance and observance by the other party in strict accordance with the terms hereof.

34. NOTICES All notices, demands, requests, advices or designations which may be or are required to be given by either party to the other hereunder shall be in writing. All notices, demands, requests, advices or designations by Landlord to Tenant shall be sufficiently given, made or delivered if personally served on Tenant by leaving the same with an officer of Tenant or delivered by a nationally recognized overnight courier service delivering at the Premises or if sent by United States certified or registered mail, postage prepaid, addressed to Tenant at the Premises. All notices, demands, requests, advices or designations by Tenant to Landlord shall be delivered to a partner of Landlord or to the head of Landlord’s property management company, sent by a nationally recognized overnight courier service delivering at the Premises, or sent by United States certified or registered mail, postage prepaid, addressed to Landlord at its offices c/o Robert Wheatley Properties at 3225 Ash Street, Palo Alto, CA 94306. Each notice, request, demand advice or designation referred to in this paragraph shall be deemed received on the date of the personal service, on the date the overnight courier delivery is made, or three (3) days after the mailing thereof in the manner herein provided, as the case may be.

35. EXAMINATION OF LEASE Submission of this instrument for examination or signature by Tenant does not constitute a reservation of or option for a lease, and this instrument is not effective as a lease or otherwise until its execution and delivery by both Landlord and Tenant. Landlord and Tenant mutually intend that neither shall have any binding contractual obligations to the other with respect to the matters referred to herein unless and until this instrument has been fully executed by both parties.

36. DEFAULT BY LANDLORD Landlord shall not be in default unless Landlord fails to perform obligations required of Landlord within a reasonable time, but in no event earlier than thirty (30) days after written notice by Tenant to Landlord and to the holder of any first mortgage or deed of trust covering the Premises whose name and address shall have heretofore been furnished to Tenant in writing, specifying wherein Landlord has failed to perform such obligations; provided, however, that if the nature of Landlord’s obligations is such than more than thirty (30) days are required for performance, then Landlord shall not be in default if Landlord commences performance within such thirty (30) day period and thereafter diligently prosecutes the same to completion. Upon any such default by Landlord under this Lease, Tenant may, except as otherwise specifically provided in this Lease to the contrary, exercise any of its rights provided at law or in equity. Any final award from a court or arbitrator in favor of Tenant requiring payment by Landlord which is not paid by Landlord within the time period directed by such award, may be offset by Tenant from Rent next due and payable under this Lease.

37. CORPORATE AUTHORITY If either party hereto is a corporation, partnership, trust, association or other entity, such party hereby covenants and warrants that (a) it is duly incorporated or otherwise established or formed and validly existing under the laws of its state of incorporation, establishment or formation, (b) it has and is duly qualified to do business in the state in which the Complex is located, (c) it has full corporate, partnership, trust, association or other appropriate power and authority to enter into this Lease and to perform all its obligations hereunder, and (d) each person (and all of the persons if more than one signs) signing this Lease on behalf of such party is duly and validly authorized to do so and that this Lease is binding upon said corporation (or partnership) in accordance with its terms. If Tenant is a corporation, Tenant shall, within thirty (30) days after execution of this Lease, deliver to Landlord a certified copy of the resolution of the Board of Directors of said corporation authorizing or ratifying the execution of this Lease.

38. BASIC RENT ADJUSTMENT (intentionally omitted)

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39. LIMITATION OF LIABILITY In consideration of the benefits accruing hereunder, Tenant and all successors and assigns covenant and agree that, in the event of any actual or alleged failure, breach or default hereunder by Landlord:

(i) the sole and exclusive remedy shall be against Landlord’s interest in the Complex;

(ii) no partner of Landlord shall be sued or named as a party in any suit or action (except as may be necessary to secure jurisdiction of the partnership)

(iii) no service of process shall be made against any partner of Landlord (except as may be necessary to secure jurisdiction of the partnership)

(iv) no partner of Landlord shall be required to answer or otherwise plead to any service of process;

(v) no judgment shall be taken against any partner of Landlord;

(vi) any judgment taken against any partner of Landlord may be vacated and set aside at any time without hearing;

(vii) no writ of execution will ever be levied against the assets of any partner of Landlord;

(viii) these covenants and agreements are enforceable both by Landlord and also by any partner of Landlord.

(ix) The term, “Landlord”, as used in this section, shall mean only the owner or owners from time to time of the fee title or the tenant’s interest under a ground lease of the land described in Exhibit “B”, and in the event of any transfer of such title or interest, Landlord herein named (and in case of any subsequent transfers the then grantor) shall be relieved from and after the date of such transfer of all liability as respects Landlord’s obligations thereafter to be performed, provided that any funds in the hands of Landlord or the then grantor at the time of such transfer, in which Tenant has an interest, shall be delivered to the grantee. Similarly, the obligations contained in this Lease to be performed by Landlord shall be binding on Landlord’s successors and assigns only during their respective periods of ownership. Tenant agrees that each of the foregoing covenants and agreements shall be applicable to any covenant or agreement either expressly contained in this Lease or imposed by statute or at common law.

40. BROKERS Tenant and Landlord each warrant that it had dealing with only of the following real estate brokers or agents in connection with the negotiation of this Lease: Cornish & Carey Commercial Real Estate representing Landlord and Trammell Crow Company representing Tenant and that it knows of no other real estate broker or agent who is entitled to a commission in connection with this Lease. Tenant and Landlord shall each indemnify the other against all costs, expenses, attorneys’ fees, liens and other liability for commissions or other compensation claimed by any other broker or agent claiming the same by, through, or under the indemnifying party.

41. SIGNS No sign, placard, picture, advertisement, name or notice shall be inscribed, displayed, printed or affixed on or to any part of the outside of the Premises or any exterior windows of the Premises without the written consent of Landlord first had and obtained (which consent shall not be unreasonably withheld, conditioned or delayed) and Landlord shall have the right to remove any such sign, placard, picture, advertisement, name or notice to which Landlord has not consented without notice to and at the expense of Tenant. If Tenant is allowed to print or affix or in any way place a sign in, on, or about the Premises, then upon expiration or other sooner termination of this Lease, Tenant at Tenant’s sole cost and expense shall both remove such sign and repair all damage in such manner as to restore all aspects of the appearance of the Premises to the condition prior to the placement of said sign.

All approved signs or lettering on outside doors shall be printed, painted, affixed or inscribed at the expense of Tenant by a person approved of by Landlord. Tenant shall not place anything or allow anything to be placed near the glass of any window, door, partition, or wall which may appear unsightly from outside the Premises.

42. FINANCIAL STATEMENTS In the event Tenant tenders to Landlord any information on the financial stability, credit worthiness or ability of the Tenant to pay the rent due and owing under the Lease, then Landlord shall be entitled to rely upon the information provided in determining whether or not to enter into this Lease Agreement with Tenant and Tenant hereby represents and warrants to Landlord the following: (i) That all documents provided by Tenant to Landlord are true and correct copies of the original; and (ii) Tenant has not withheld any information from Landlord which is material to Tenant’s credit worthiness, financial condition or ability to pay the rent; and (iii) all information supplied by Tenant to Landlord is, at the time

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given, true, correct and accurate; and (iv) no part of the information supplied by Tenant to Landlord contains misleading or fraudulent statements.

A default under this paragraph shall be a non-curable default on behalf of Tenant and Landlord shall be entitled to pursue any right or remedy available to Landlord under the terms of this Lease or available to Landlord under the laws of the State of California.

43. HAZARDOUS MATERIALS

A. As used herein, the term “Hazardous Material” shall mean any substance or material which has been determined by any state, federal or local governmental authority to be capable of posing a risk of injury to health, safety or property including all of those materials and substances designated or defined as “hazardous” or “toxic” by (i) the Environmental Protection Agency, the California Water Quality Control Board, the Department of Labor, the California Department of Industrial Relations, the Department of Transportation, the Department of Agriculture, the Consumer Product Safety Commission, the Department of Health and Human Services, the Food and Drug Agency or any other governmental agency now or hereafter authorized to regulate materials and substances in the environment, or by (ii) the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. 9601 et seq., as amended; the Hazardous Materials Transportation Act, 49 U.S.C. 1801, et seq., as amended; the Resource Conservation and Recovery Act, 42 U.S.C. 6901, et seq., as amended; the Hazardous Waste Control Law, California Health & Safety Code 25100 et seq., as amended; Sections 66680 through 66685 of Title 22 of the California Administration Code, Division 4, Chapter 30, as amended; and in the regulations adopted and publications promulgated pursuant to said laws.

B. Tenant shall not cause or permit any Hazardous Material to be used, stored, discharged, released or disposed of in, from, under or about the Premises or the Complex, or any other land or improvements in the vicinity of the Premises or the Complex in violation of applicable laws. Notwithstanding the foregoing, Tenant may use and store reasonable amounts of customary cleaning supplies and other substances required in the conduct of Tenant’s business, provided the same are used and stored in compliance with any and all federal, state, and local laws, ordinances and regulations governing the same. If the presence of Hazardous Materials on the Premises or the Complex caused or permitted by Tenant results in contamination of the Premises or the Complex or any soil in or about the Premises or the Complex, Tenant, at its expense shall promptly take all actions necessary to return the Premises or the Complex to the condition existing prior to the appearance of such Hazardous Material caused or permitted by Tenant, Tenant’s contractors, agents, or invitees. The termination of this Lease shall not terminate or reduce the liability or obligations of Tenant under this Section, or as may be required by law, to clean up, monitor or remove any Hazardous Materials from the Premises or the Complex.

Tenant shall defend, hold harmless and indemnify Landlord and its agents and employees with respect to all claims, damages and liabilities arising out of or in connection with any Hazardous Material used, stored, discharged, released or disposed of in, from, under or about the Premises or the Complex, where said Hazardous Material is or was attributable to the activities of Tenant, its agents or contractors during the Lease term and whether or not Tenant had knowledge of such Hazardous Material, including, without limitation, any cost of monitoring or removal, any reduction in the fair market value or fair rental value of the Premises or the Complex and any loss, claim or demand by any third person or entity relating to bodily injury or damage to real or personal property.

Tenant shall not suffer any lien to be recorded against the Premises or the Complex as a consequence of a Hazardous Material, including any so called state, federal or local “super fund” lien related to the “clean up” of a Hazardous Material in or about the Premises, where said Hazardous Material is or was attributable to the activities of Tenant.

C. In the event Hazardous Materials are discovered in or about the Premises or the Complex, and Landlord has substantial reason to believe that Tenant was responsible for the presence of the Hazardous Material, then Landlord shall have the right to appoint a consultant, at Tenant’s expense, to conduct an investigation to determine whether Hazardous Materials are located in or about the Premises or the Complex and to determine the corrective measures, if any, required to remove such Hazardous Materials. Tenant, at its expense, shall comply with all recommendations of the consultant, as required by law. To the extent it is determined that Tenant was not responsible for the presence of the Hazardous Materials, then Landlord shall reimburse Tenant for any costs incurred by Landlord and paid by Tenant under the terms of this paragraph 45.C.

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Tenant shall immediately notify Landlord of any inquiry, test, investigation or enforcement proceeding by or against Tenant or the Premises or the Complex concerning a Hazardous Material of which Tenant has knowledge. Tenant acknowledges that Landlord, as the owner of the Property, at its election, shall have the sole right, at Tenant’s expense, to negotiate, defend, approve and appeal any action taken or order issued with regard to a Hazardous Material by an applicable governmental authority. Provided Tenant is not in default under the terms of this Lease, Tenant shall likewise have the right to participate in any negotiations, approvals or appeals of any actions taken or orders issued with regard to the Hazardous Material and Landlord shall not have the right to bind Tenant in said actions or orders.

D. It shall not be unreasonable for Landlord to withhold its consent to any proposed assignment or subletting if (i) the proposed assignee’s or subtenant’s anticipated use of the Premises involves the storage, use or disposal of Hazardous Material; (ii) if the proposed assignee or subtenant has been required by any prior landlord, lender or governmental authority to “clean up” Hazardous Material; (iii) if the proposed assignee or subtenant is subject to investigation or enforcement order or proceeding by any governmental authority in connection with the use, disposal or storage of a Hazardous Material.

E. Tenant shall surrender the Premises to Landlord, upon the expiration or earlier termination of the Lease, free of Hazardous Materials which are or were attributable to Tenant. If Tenant fails to so surrender the Premises, Tenant shall indemnify and hold Landlord harmless from all damages resulting from Tenant’s failure to surrender the Premises as required by this paragraph, including, without limitation, any claims or damages in connection with the condition of the Premises including, without limitation, damages occasioned by the inability to relet the Premises or a reduction in the fair market and/or rental value of the Premises or the Complex by reason of the existence of any Hazardous Materials, which are or were attributable to the activities of Tenant, in or around the Premises or the Complex. Notwithstanding any provision to the contrary in this Lease, if any action is required to be taken by a governmental authority to clean-up, monitor or remove any Hazardous Materials, which are or were attributable to the activities of Tenant, from the Premises or the Complex and such action is not completed prior to the expiration or earlier termination of the Lease, then at Landlord’s election (i) this Lease shall be deemed renewed for a term commencing on the expiration date of this Lease and ending on the date the clean-up, monitoring or removal procedure is completed (provided, however, that the total term of this Lease shall not be longer than 34 years and 11 months); or (ii) Tenant shall be deemed to have impermissibly held over and Landlord shall be entitled to all damages directly or indirectly incurred in connection with such holding over, including without limitation damages occasioned by the inability to relet the Premises or a reduction in the fair market and/or fair rental value of the Premises or the Complex by reason of the existence of the Hazardous Material.

F. Upon the Lease Commencement Date, Tenant shall provide to Landlord a complete list of all chemicals, toxic waste or other materials constituting Hazardous Materials other than standard office and janitorial supplies employed by Tenant within the Premises. Throughout the terms of the Lease, Tenant shall continue to update this list of chemicals, contaminants and Hazardous Materials.

Notwithstanding anything to the contrary in this Lease, in no case shall Tenant be responsible for Hazardous Materials or contamination there from in, on, or under the Premises or the Complex which precedes the Commencement Date unless it can be shown that Tenant is directly responsible for said contamination.

44. MISCELLANEOUS AND GENERAL PROVISIONS

A. Tenant shall not, without the written consent of Landlord, use the name of the building for any purpose other than as the address of the business conducted by Tenant in the Premises.

B. This Lease shall in all respects be governed by and construed in accordance with the laws of the State of California. If any provision of this Lease shall be invalid, unenforceable or ineffective for any reason whatsoever, all other provisions hereof shall be and remain in full force and effect.

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C. The term “Premises” includes the space leased hereby and any improvements now or hereafter installed therein or attached thereto. The term “Landlord” or any pronoun used in place thereof includes the plural as well as the singular and the successors and assigns of Landlord. The term “Tenant” or any pronoun used in place thereof includes the plural as well as the singular and individuals, firms, associations, partnerships and corporations, and each of their respective heirs, executors, administrators, successors and permitted assigns, according to the context hereof, and the provisions of this Lease shall inure to the benefit of and bind such heirs, executors, administrators, successors and permitted assigns.

The term “person” includes the plural as well as the singular and individuals, firms, associations, partnerships and corporations. Words used in any gender include other genders. If there be more than one Tenant the obligations of Tenant hereunder are joint and several. The paragraph headings of this Lease are for convenience of reference only and shall have no effect upon the construction or interpretation of any provision hereof.

D. Time is of the essence of this Lease and of each and all of its provisions.

E. If this Lease is recorded, at the expiration or earlier termination of this Lease, Tenant shall execute, acknowledge and deliver to Landlord, within ten (10) days after written demand from Landlord to Tenant, any quitclaim deed or other document required by any reputable title company, licensed to operate in the State of California, to remove the cloud or encumbrance created by this Lease from the real property of which Tenant’s Premises are a part.

F. This instrument along with any exhibits and attachments hereto constitute the entire agreement between Landlord and Tenant relative to the Premises and this agreement and the exhibits and attachments may be altered, amended or revoked only by an instrument in writing signed by both Landlord and Tenant. Landlord and Tenant hereby agree that all prior or contemporaneous oral agreements between and among themselves and the agents or representatives relative to the leasing of the Premises are merged in or revoked by this agreement.

G. Neither Landlord nor Tenant shall record this Lease or a short form memorandum hereof without the consent of the other.

H. Tenant further agrees to execute any amendments required by a lender to enable Landlord to obtain financing, so long as Tenant’s rights hereunder are not materially adversely affected and so long as Tenant’s obligations hereunder are not materially increased or altered.

I. Paragraph(s) 45 through 47 are/is added hereto and are/is included as a part of this Lease.

J. Clauses, plats and riders, if any, signed by Landlord and Tenant and endorsed on or affixed to this Lease are a part hereof.

K. Tenant covenants and agrees that no diminution or shutting off of light, air or view by any structure which may be hereafter erected (whether or not by Landlord) shall in any way affect this Lease, entitle Tenant to any reduction of rent hereunder or result in any liability of Landlord to Tenant.

45. “AS IS” ‘Except as specifically set forth in Section 8 of the Lease and in this Section 45, Tenant agrees to lease the Premises in an “as-is” condition, and any alterations or modifications to the Premises shall be made in accordance with paragraph 8 & 9 of the Lease and shall not delay the commencement of the Lease nor delay the payment of rent and all such modifications shall be at Tenant’s sole cost and expense; notwithstanding the Tenant taking the Premises in “as-is” condition, Landlord shall be responsible, at Landlord’s sole cost and expense, for the following items: 1) Delivery of the Premises to Tenant with the building systems, including but not limited to roof membrane, plumbing, mechanical, and electrical systems are in good working order 2) As needed interior painting, shampooing of carpets, polishing of floor tiles and re-striping of the parking lot 3) If an issue exists as of the commencement date with the Premises as delivered relating to the Americans with Disabilities Act (“ADA”), Landlord shall bring the Premises into compliance. All of these items 1 – 3 in this paragraph (if required) shall be complete no later than January 1, 2007. Landlord shall also reimburse Tenant for its qualified tenant improvement costs as more specifically described in Exhibit C to the Lease

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Tenant shall be responsible for compliance with all laws relating to Tenant’s specific use or alteration of the Premises.

46. OPTION TO EXTEND Subject to the terms and conditions set forth hereafter, Tenant is granted the one-time option to extend (“Option to Extend”) the initial term of the Lease for one (1) additional period of three (3) years beginning immediately following the initial Lease term and ending on December 31, 2014 upon the following terms:

A. Tenant shall notify Landlord in writing of the exercise of the Option to Extend to Landlord not less 12 months prior to the expiration of the original Lease term. The extended term of this Lease shall commence on January 1, 2012 and shall expire on December 31, 2014.

B. The Basic Rent will be adjusted to equal the “Fair Market Rental Rate,” (defined below) as mutually agreed upon by Landlord and Tenant within sixty (60) days after Tenants exercise of the Option to Extend. If the parties are unable to agree on the Basic Rent within such sixty (60) day period, the Fair Market Rental Rate shall be determined by the appraisal process set forth in paragraph E. below.

C. The Additional Rent described in paragraph 4D of the Lease shall continue to be paid and adjusted according to paragraph 4D of this Lease.

D. The Option to Extend can be exercised only by Tenant or a Permitted Transferee for its sole use of the Premises and may not be exercised by any other assignee of the Lease or sublessee of the Premises or a part thereof.

E. If Tenant is in default on the date of giving the Option Notice, and Tenant does not cure such default as provided for in Paragraph 22 of the Lease, the Option Notice shall be void and of no effect. If Tenant is in default on the date the Option Term is to commence, and Tenant does not cure such default as provided for in Paragraph 22 of the Lease, then, at the sole election of Landlord, such term shall not commence and this Lease shall expire at the end of the initial term.

F. If Landlord and Tenant do not mutually agree as to the Fair Market Rental Rate within sixty (60) days, then the Fair Market Rental Rate will be determined according to the following procedure:

(1) Each party will within ten (10) days following the expiration of the initial sixty (60) day period appoint a real estate appraiser or broker having no less than five (5) years’ experience in the commercial leasing market in Palo Alto, California, to determine the Fair Market Rental Rate. If one party fails to so designate an appraiser within the time required, the determination of Fair Market Rental Rate of the appraiser who has been timely designated by the other party will be binding on both parties.

(2) The appraisers will submit their determinations of Fair Market Rental Rate to both parties within thirty (30) days after their selection.

(3) If the determinations of the two appraisers or brokers are within five (5) percent of each other, then their determinations shall be averaged to determine the Fair Market Rental Rate and no further determination will be required; if the determinations differ by more than five (5) percent, then subsection 4 below shall apply.

(4) Within ten (10) days of the date the second appraiser’s determination is submitted to the parties, the two appraisers will designate as third appraiser a real estate attorney or broker having no less than ten (10) years’ experience in the retail leasing market in Palo Alto, California. The sole responsibility of the third appraiser will be to determine which of the determinations made by the first two appraisers is most accurate. The third appraiser has no right to propose a middle ground or any modification of either of the determinations made by the first two appraisers. The third appraiser’s choice will be submitted to the parties within twenty (20) days after his or her selection.

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Such determination will bind both of the parties and will establish the Fair Market Rental Rate.

(5) If the Fair Market Rental Rate has not been determined prior to the commencement of the Extended Term, Tenant will continue to pay the then prevailing Basic Rent and at such time as the Fair Market Rental Rate is determined, Tenant will pay any additional amount or Landlord will refund any overpayment retroactive to the commencement of the Extended Term.

(6) Each party will pay the fees and expenses of the appraiser selected by it, and one-half (1/2) of the fees and expenses of the third appraiser if applicable.

F. “Fair Market Rental Rate” shall mean the effective base rental rates, including all escalations, at which tenants lease comparable space as of the commencement of the Option Term. For purposes hereof, “comparable space” means office space that is to the extent available for comparison (i) not subleased; (ii) not subject to another tenant’s expansions rights; (iii) comparable in size, location and quality to the Premises; (iv) leased for a term comparable to the Option Term; and (v) located in a comparable building in the Palo Alto, California area. In determining the rental rate of comparable space, the parties shall include all escalations and take into consideration the following concessions: (x) rental abatement concessions, if any, being granted to tenants in connection with the comparable space; (y) tenant improvements or allowances provided or to be provided for the comparable space, taking into account the value of the existing improvements in the Premises (except to the extent such improvements have been installed in the Premises at Tenant’s expense), as compared to the value of the improvements in comparable space (excepting those installed at the expense of the tenant); and (z) all other monetary and non-monetary concessions, if any, being granted to tenants in connection with the comparable space.

47. EARLY TERMINATION Tenant is hereby granted a one time right to terminate the Lease as of December 31, 2009 (“Early Termination Right”) which Tenant may exercise by doing each of the following in a timely manner: 1) providing Landlord with a minimum of six ( 6 ) months prior written notice and 2) paying an early termination fee to Landlord in good funds in the amount of One Hundred Ninety Eight Thousand Dollars ($198,000.00) (the “Early Termination Fee”) no later than December 1, 2009. If Tenant fails to give the required notice or pay the Early Termination Fee in a timely manner, this Early Termination Right shall be void and of no further effect and the term of the Lease shall expire on December 31, 2011, unless sooner terminated or extended pursuant to the terms of the Lease.

IN WITNESS WHEREOF, Landlord and Tenant have executed and delivered this Lease as of the day and year first above written.

LANDLORD:		TENANT:
El Camino Center		Danger, Inc.
By	/s/ Jack R. Wheatley	By	/s/ Henry R. Nothhaft
Name	Jack R. Wheatley	Name	Henry R. Nothhaft
	(printed)		(printed)
Title	Mng. Partner	Title	CEO

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EXHIBIT “A”

EXHIBIT C

Tenant Improvements

Tenant shall manage and be responsible for the design and construction of its tenant improvements, subject to Section 9 of the Lease. Landlord shall provide construction management services to Tenant at a cost not to exceed Five Hundred Twenty Dollars ( $520.00 ) per month based on the expectation of attending weekly construction meetings and facilitating Tenant’s construction performed under a contract with an independent general contractor.

The cost and expense of any the tenant improvements shall be borne solely by Tenant except as specifically provided for in Paragraph 45 of the Lease and as follows:

Landlord shall provide Tenant with an allowance of $10.00 per rentable square foot, to be utilized by Tenant for its interior improvements to the Premises (the “Tenant Improvement Allowance”). Tenant shall submit proof of payment to Landlord for its reasonable construction costs of tenant improvements (not including Tenant’s fixtures) within thirty (30) days of receipt of such proof of payment Landlord shall reimburse Tenant such costs up to the full amount of the Tenant Improvement Allowance. Landlord shall accept requests for draws against the Tenant Improvement Allowance from the date of Lease commencement through August 31, 2007. Despite any balance of Tenant Improvement Allowance unclaimed by submittal to Landlord of qualified proof of payment as of September 1, 2007, Landlord shall have no further liability to Tenant for reimbursement of any Tenant Improvement Allowance for claims not made prior to August 31, 2007.

EX-10.26

Exhibit 10.26

LEASE BY AND BETWEEN

BILLTECH EQUITY PARTNERS, LLC, AS LANDLORD

and

DANGER, INC., AS TENANT

TABLE OF CONTENTS

ARTICLE 1 - REFERENCE, DEFINITIONS AND EXHIBITS			1
	1.1	Definitions	1
	1.2	Effect of Reference to Definitions	3
	1.3	Exhibits	3
ARTICLE 2 - PREMISES, TERM AND COMMENCEMENT OF TERM			4
	2.1	Premises	4
	2.2	Term	4
	2.2	Late Delivery of Premises	4
ARTICLE 3 - RENT, ITS DETERMINATION, COMMENCEMENT AND METHOD OF PAYMENT			5
	3.1	Base Rent	5
	3.2	Additional Rent – Real Estate Taxes	5
	3.3	Additional Rent – Operating Expenses	7
	2.4	Audit Rights	9
	3.5	Rent	10
	3.6	Independent Covenants	10
	3.7	Gross-Up	10
ARTICLE 4 - SECURITY DEPOSIT			10
ARTICLE 5 - UTILITIES AND SERVICES			11
	5.1	Electricity	11
	5.2	Landlord’s Services	12
	5.3	Access and Security	13
ARTICLE 6 - INSURANCE			13
	6.1	Required Coverage	13
	6.2	Writing and Disposition of Insurance Policies	13
	6.3	Mutual Waiver of Subrogation	13
	6.4	Blanket Policies	14
	6.5	Landlord’s Insurance Covenants	14
ARTICLE 7 - TENANT’S ADDITIONAL COVENANTS			14
	7.1	Performing Obligations	14
	7.2	Use	15
	7.3	Maintenance and Repair	15
	7.4	Compliance with Laws	15
	7.5	Payment for Tenant’s Work	16
	7.6	Indemnity	16
	7.7	Personal Property at Tenant’s Risk	17
	7.8	Payment of Landlord’s Cost of Enforcement	17
	7.9	Yield Up	17

	7.10	Subordination	18
	7.11	Estoppel Certificates	18
	7.12	Nuisance	18
	7.13	Changes and Alterations	18
	7.14	Financial Statements	20
	7.15	Holdover	20
ARTICLE 8 - QUIET ENJOYMENT			21
ARTICLE 9 - DAMAGE AND EMINENT DOMAIN			21
	9.1	Fire and Other Casualty	21
	9.2	Eminent Domain	22
ARTICLE 10 - DEFAULTS BY TENANT AND REMEDIES			23
	10.1	Tenant’s Default	23
	10.2	Landlord’s Election	23
	10.3	Reimbursement of Landlord’s Expenses	24
	10.4	Termination of Right of Possession	24
	10.5	Mitigation	25
	10.6	Claims in Bankruptcy	25
	10.7	Landlord’s Right to Cure Defaults	25
	10.8	No Waiver	25
	10.8	Late Charge; Default Interest	26
ARTICLE 11 - ASSIGNMENT AND SUBLETTING			26
	11.1	Prohibition	26
	11.2	Conditions to Consent	26
	11.3	Excess Rents	27
	11.4	Landlord’s Recapture Right	27
	11.5	Assignment or Sublease to an Affiliate	27
	11.6	No Waiver	28
ARTICLE 12 - NOTICES			28
ARTICLE 13 - NOTICE OF LEASE			28
ARTICLE 14 - APPLICABLE LAW, SEVERABILITY, CONSTRUCTION			29
ARTICLE 15 - SUCCESSORS AND ASSIGNS, ETC.			29
ARTICLE 16 - LANDLORD’S ACCESS			30
ARTICLE 17 - CONDITION OF PREMISES			30
	17.1	As Is	30
	17.2	Landlord’s Work	30

ARTICLE 18 - WARRANTY REGARDING BROKER			30
ARTICLE 19 - FORCE MAJEURE			31
ARTICLE 20 - HAZARDOUS MATERIALS			31
ARTICLE 21 - EXTENSION PERIOD			32
	20.1	Option to Extend Lease Term	32
	20.2	Determination of Option Rent	33
	20.3	Annual Increases in Option Rent	33

LEASE

THIS LEASE (the “Lease”) is dated as of the 23rd day of January, 2007 and is entered into by and between Landlord and Tenant named below.

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

ARTICLE 1

REFERENCE, DEFINITIONS AND EXHIBITS

1.1 Definitions. Whenever used herein, the following terms shall have the following meanings:

Landlord:	Billtech Equity Partners, LLC, a Delaware limited liability company
Landlord’s
Address:	c/o Everest Partners, LLC
	150 East 58th Street
	Suite 2000
	New York, New York 10155
Landlord’s
Managing Agent:	Everest Partners, LLC
	150 East 58th Street
	Suite 2000
	New York, New York 10155
Landlord’s
Local Massachusetts
Managing Agent:	Everest Partners, LLC
	700 Technology Park Drive
	Suite 102
	Billerica, MA 01821
	Tel: 978-564-8002
	Fax: 978-564-8003
	www.everestllc.com
Tenant:	Danger, Inc., a Delaware corporation
Original Address
of Tenant:	3101 Park Boulevard
	Palo Alto, CA 94306

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Address of Tenant after Term Commencement Date:	3101 Park Boulevard Palo Alto, CA 94306
Broker:	The Codman Company, Inc. and The Staubach Company
Term Commencement Date:	The later of: (a) March 1, 2007, and (b) the date Landlord delivers possession of the Premises to Tenant, with all Landlord Work substantially completed, subject to Force Majeure and delays caused by Tenant. The Estimated Term Commencement Date is forty-five (45) days after full execution of this Lease.
Rent Commencement Date:	Two (2) months following the Term Commencement Date
Original Lease Term:	Three (3) years and two (2) months from the Term Commencement Date (unless the same is earlier terminated or extended in accordance with the terms and conditions of this Lease).
Option to Extend Original Lease Term:	One (1) option to extend for three (3) years, in accordance with Article 20 hereof.
Lease Term:	The Original Lease Term, as the same may have been extended or earlier terminated, in accordance with the terms and condition of this Lease.
Premises:	The approximately 5,730 square feet of rentable space on the second floor of the Building, as shown on the plan attached hereto as Exhibit A.
Building:	The building containing approximately 43,422 square feet of rentable space located on the Site. The Building is shown on the plan attached hereto as Exhibit B.
Site:	The site located in Billerica, Massachusetts, having an address of 700 Technology Park Drive, Billerica, Massachusetts 01821 and the Building and all improvements and other buildings now or hereafter located thereon (including, without limitation, all driveways, pavement, parking areas, landscaping, and utilities). A

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	legal description of the boundaries of the Site is attached hereto as Exhibit C.
Parking and Loading Docks:	See Section 2.1.
Permitted Uses:	General business office use, and for no other purpose, subject in all cases to applicable Legal Requirements.
Lease Year:	Each of the successive periods of twelve (12) calendar months, beginning with the first day of the first month following the Term Commencement Date (or beginning with the Term Commencement Date, if that is the first day of a month), but if this Lease ends on a day other than the last day of a Lease Year (as defined above), the last Lease Year shall end on the termination date. If the Term Commencement Date is not the first day of a month, the first Lease Year shall include the number of days from the Term Commencement Date through the end of said month.
Tenant’s Proportionate Share:	13.2% (which is calculated by dividing the Premises rentable area by the Building rentable area.)
Landlord’s Mortgagee:	Any party holding a mortgage on the Site including, without limitation, the Premises, given as security for indebtedness owed by Landlord to the holder of the mortgage.

1.2 Effect of Reference to Definitions. Any reference in this Lease to any term defined above shall be deemed, to the extent possible, to mean and include all aspects of the definition set forth above for such term.

1.3 Exhibits. The exhibits listed in this Section and attached to this Lease are incorporated by reference and are a part of this Lease.

Exhibit A:	Plan of Premises
Exhibit B:	Site Plan Showing Building
Exhibit C:	Legal Description of the Boundaries of the Site
Exhibit D:	Landlord’s Work
Exhibit E:	Rules and Regulations

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ARTICLE 2

PREMISES, TERM AND COMMENCEMENT OF TERM

2.1 Premises. Landlord hereby leases to Tenant the Premises subject to and with the benefit of the terms, covenants, conditions and provisions of this Lease and all easements, covenants and restrictions appurtenant thereto, if any. Tenant shall have the use, in common with others entitled thereto, of the roadways, driveways, parking areas, sidewalks and all other common areas serving the Building, all subject to reasonable rules and regulations promulgated by Landlord from time to time. In addition, Tenant shall have the right to use, on a first come, first served basis and in common with others entitled thereto, free of charge throughout the Lease Term, the following: (i) parking spaces in the parking area serving the Building, not to exceed a ratio of three (3) parking spaces per 1,000 rentable square feet of Premises; and (ii) one (1) existing loading dock.

2.2 Term. TO HAVE AND TO HOLD the Premises for the Original Lease Term, commencing on the Term Commencement Date, subject to the terms, covenants, agreements and conditions contained in this Lease. Notwithstanding the foregoing, Tenant shall be allowed to access the Premises no earlier than two (2) weeks prior to the Term Commencement Date for the sole purpose of installing furniture, fixtures and equipment in the Premises (the “Installation”); provided, however, that Tenant provides written notice to Landlord of such early occupancy no less than twenty-four (24) hours before such early occupancy. Tenant agrees to access the Premises and perform the Installation subject to the terms and conditions of this Lease, including but not limited to Article 7 of this Lease and the Rules and Regulations set forth in Exhibit E.

2.3 Late Delivery of Premises. Landlord shall use commercially reasonable efforts to deliver possession of the Premises to Tenant in the condition required by this Lease, including without limitation, substantial completion of the Landlord’s Work, on or before the date which is forty-five (45) days after full execution of this Lease. If, despite such efforts, Landlord is unable to deliver such possession by such date, Landlord shall not be subject to any liability therefor, nor shall such failure affect the validity of this Lease. Tenant shall not, however, be obligated to pay Rent or perform any other obligation of Tenant under the terms of this Lease until Landlord delivers possession of the Premises to Tenant, and any period of rent abatement that Tenant would otherwise have enjoyed shall run from the date of delivery of possession and continue for a period equal to what Tenant would otherwise have enjoyed under the terms hereof, but minus any days of delay caused by the acts or omissions of Tenant. If possession of the Premises in the condition required by this Lease is not delivered to Tenant on or before June 1, 2007 (subject to Force Majeure, any delays caused by Tenant and Landlord’s inability, despite its due diligence, to obtain the permits needed to commence and complete Landlord’s Work), Tenant shall have the right and option, upon thirty (30) days’ prior written notice to Landlord and Landlord’s Mortgagee, to cancel this Lease, in which event the parties shall be discharged from all obligations hereunder as of the expiration of such thirty (30) day period unless, on or before the such date, Landlord substantially completes Landlord’s Work. “Substantial completion,” as used herein, shall mean that Landlord’s Work has been completed except for items of work (and, if applicable, adjustment of equipment and fixtures) which can be completed after occupancy has been taken without causing undue interference with Tenant’s use of the Premises (i.e. so called “punch list” items).

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ARTICLE 3

RENT, ITS DETERMINATION, COMMENCEMENT AND METHOD OF PAYMENT

3.1 Base Rent. Tenant covenants and agrees to pay, during the Lease Term, to Landlord, or to such other person as Landlord by written notice instructs Tenant to make such payments for Landlord’s benefit and account, without demand (except as otherwise herein specifically provided), at the Address of Landlord set forth in Section 1.1 or at such other place as Landlord may by written notice to Tenant direct, commencing with the Rent Commencement Date, Base Rent, as follows:

Period	Annual Base Rent		Monthly Installment of Base Rent
Months 1-2*	$	0	$	0
Months 3-12	$	91,680.00	$	7,640.00
Months 13-24	$	94,545.00	$	7,878.75
Months 25-38	$	97,410.00	$	8,117.50

* Base Rent shall be abated for the first two (2) months of the Lease Term.

The rent shall be paid on the first day of each full calendar month of the Lease Term, and pro rata based on the actual number of days in such month, for any portion of a calendar month included at the beginning or end of the Lease Term, payable on the first day of such month or partial month.

3.2 Additional Rent – Real Estate Taxes. In addition to the Base Rent, Tenant shall also pay to Landlord, as Additional Rent, Tenant’s Proportionate Share of all Real Estate Taxes in excess of Base Year Taxes (the “Tax Obligation”).

(i) For the purposes of this Section 3.2, the following words and terms shall have the following meaning:

(a) “Tax Year” shall mean the twelve-month period commencing July 1st, and each twelve-month period commencing on an anniversary of said date during the term of this lease.

(b) “Base Year Taxes” shall mean the Taxes assessed for the tax fiscal year July 1, 2006 through June 30, 2007 without giving effect to any tax abatement, credit, treaty, refund or other concession. No Real Estate Taxes shall be payable by Tenant for the period beginning on the Commencement Date and ending June 30, 2007.

(c) “Real Estate Taxes” shall mean all taxes including real estate taxes (which term shall include payments in lieu of real estate taxes), assessments, levies, license and permit fees and other governmental charges, general and special, ordinary and extraordinary, foreseen and unforeseen, of any kind and nature whatsoever, which at any time during the Lease Term may be assessed, levied, confirmed, imposed upon, or may become due and payable out of or in

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respect of, or become a lien upon, all or any portion of the Site (including, without limitation, all improvements thereto) other than: (i) municipal, state and federal income taxes (if any) assessed against Landlord; or (ii) municipal, state or federal capital levy, gift, estate, succession, inheritance or transfer taxes of Landlord; or (iii) corporation excess profits or franchise taxes imposed upon any corporate owner of the Site, provided, however, that if at any time during the Lease Term the methods of taxation prevailing at the commencement of the Lease Term shall be altered so that in lieu of, as a substitute for, or in addition to, the whole or any part of the taxes, assessments, levies or charges now levied, assessed or imposed on real estate and the improvements thereon, there shall be levied, assessed and imposed a tax, assessment, levy, imposition or charge, wholly or partially as a capital levy or otherwise, on the rents received therefrom, or measured by or based in whole or in part upon the Site and imposed upon Landlord, then all such taxes, assessments, levies, impositions or charges or the part thereof so measured or based, shall be deemed to be included within the term “Real Estate Taxes” for the purposes hereof. In addition to the foregoing, the term “Real Estate Taxes” shall include any new tax of a nature not presently in effect, but which may be hereafter levied, assessed, or imposed upon Landlord or all or any portion of the Site, if such tax shall be based on or arise out of the ownership, use or occupation of all or any portion of the Site.

(ii) Landlord may, at its sole discretion, bill Tenant monthly, quarterly, semi-annually or annually for Tenant’s Tax Obligation. Any bill for a month, quarter or half-year may be rendered on an estimated basis. If Landlord shall render a monthly, quarterly or semi-annual bill on account of any Tax Year, then within one hundred eighty (180) days after the close of such Tax Year, Landlord shall render an annual bill for such Tax Year, which annual bill shall make appropriate adjustment as may be necessary to reflect actual Tenant’s actual Tax Obligation during such Tax Year, including, without limitation, any refund that may be due to Tenant, to be taken as a credit against future payments of Additional Rent due hereunder.

(iii) Any bills for Tenant’s Tax Obligation shall be due at the same time and in the same manner as the next monthly installment of Base Rent is due pursuant to Section 3.1, if Landlord has elected to bill Tenant for Tenant’s Tax Obligation on a monthly basis. If, however, Landlord bills Tenant for its Tenant’s Tax Obligation on a quarterly or half-year basis, or if the Lease Term has terminated or expired, then Tenant’s Tax Obligation shall be due within thirty (30) days after receipt by Tenant of a bill therefor.

(iv) Appropriate credit against any Tenant’s Tax Obligation shall be given for any refund obtained by reason of a reduction in any Real Estate Taxes by the courts or other governmental agency responsible therefor. The original computation of Tenant’s Tax Obligation, as well as reimbursement or payments of additional charges, if any, or allowances, if any, under the provisions of this Section 3.2 shall be based on the original assessed valuations, with adjustments to be made at a later date when the tax refund, if any, shall be paid to Landlord by the taxing authority. Expenditures for legal fees and for other similar or dissimilar expenses incurred in obtaining the tax refund shall be charged against the tax refund before the adjustments are made for any Tax Year, but such charges shall in no event exceed the amount of the tax refund.

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(v) If the Term Commencement Date or the expiration or earlier termination of the Lease Term occurs in the middle of a Tax Year, subject to 3.2(i)(b), Tenant shall be liable for only that portion of Tenant’s Tax Obligation in respect of said Tax Year represented by a fraction, the numerator of which is the number of days of the herein Lease Term which falls within said Tax Year, and the denominator of which is three hundred sixty-five (365).

(vi) In the event the first day of the Tax Year in the Town of Billerica should be changed after the Term Commencement Date to a day other than July 1 so as to change the twelve (12) month period comprising a Tax Year, in determining Tenant’s Tax Obligation with respect to Real Estate Taxes payable for the period between July 1 and such changed first day of the Tax Year, Tenant’s Tax Obligation shall be multiplied by a fraction, the numerator of which shall be the number of days elapsing during such period, and the denominator of which shall be three hundred sixty-five (365).

(vii) Any obligation of Tenant or Landlord under this Section 3.2 which shall not have been paid at the expiration of the Lease Term shall survive such expiration and shall be paid when and as the amount of same shall be determined to be due.

3.3. Additional Rent – Operating Expenses. In addition to the Base Rent, Tenant shall also pay to Landlord, as Additional Rent, Tenant’s Proportionate Share of all Operating Expenses over Base Year Operating Expenses (the “Operating Expense Obligation”).

(i) For the purposes of this Section 3.3, the following words and terms shall have the following meaning:

(a) “Computation Year” shall mean each calendar year beginning with calendar year 2008.

(b) “Base Year Operating Expenses” shall mean Operating Expenses for the period January 1, 2007 through December 31, 2007. No Operating Expenses shall be payable by Tenant for the period beginning on the Commencement Date and ending December 31, 2007.

(c) “Operating Expenses” shall mean the aggregate expenses incurred by Landlord in the operation, maintenance and management of the Site during the Lease Term including, without limitation, the following: (i) utilities supplied to the Site (to the extent the same are not being paid directly by Tenant or other tenants of the Building); (ii) “fringe” benefits for employees or contractors engaged on a full-time basis in connection with servicing the Site and payroll taxes, workmen’s compensation insurance premiums and similar costs with respect thereto, and an appropriate portion of same with respect to employees or contractors on a part-time basis; (iii) all insurance obtained by Landlord relating to or otherwise in connection with its ownership or the operation, rental, or management of the Site, the foregoing to include without limitation any liability insurance, rent loss insurance, and any other insurance required by Landlord’s Mortgagee; (iv) services obtained for the benefit of the Site (including, without limitation, snow removal and grounds maintenance); (v) repairs, replacement, repainting, maintenance, supplies and the like for the Site, subject to the exceptions set forth in Section 5.2; (vi) management fees equal to five percent (5%) of gross rentals from the Building per annum;

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(vii) legal fees and expenses, excluding any legal fees incurred by Landlord in connection with Landlord’s dealings with any specific tenant of the Building, and any consulting fees and expenses in connection with any reduction of any Operating Expenses or Real Estate Taxes; (viii) auditing fees and expenses; and (ix) depreciation (on a straight line basis) for capital replacements and improvements made by Landlord which are required in the ordinary course of maintaining the Site or Building or which are projected by Landlord to reduce the Operating Expenses thereof, the cost of which shall be amortized over the useful life of the capital replacement or improvement in accordance with generally accepted accounting principles. Notwithstanding the foregoing, the following items shall be excluded from “Operating Expenses”: (i) loan fees, principal or interest payments on any mortgages or other financing arrangements, (ii) leasing commissions, (iii) depreciation for the Site; (iv) capital expenditures, as defined under generally accepted accounting principles, other than as set forth in clause (ix) above; (v) ground rent under ground leases; (vi) utility charges payable by Tenant directly to the applicable provider, (vii) any costs, fines or penalties incurred due to violations by Landlord of any Legal Requirements, this Lease or any other lease in the Building, or due to Landlord’s negligence or willful misconduct, or for the late payment of any obligation of Landlord; (viii) costs covered by any guarantee or warranty; (ix) marketing costs; (x) services or work provided to other tenants but not to Tenant without an additional charge; (xi) the cost of preparing space for occupancy by tenants, (xii) costs reimbursed by insurance proceeds (excluding deductible amounts), (xiii) attorneys’ fees, costs, disbursements, and other expenses incurred in connection with negotiations or disputes with tenants, or in connection with leasing, renovating, or improving space for tenants or other occupants or prospective tenants or other occupants of the Building, (xiv) costs with respect to the creation of a mortgage or a superior lease or in connection with a sale of the Building or the Site, (xv) Landlord’s or Landlord’s property manager’s corporate general overhead or corporate general administrative expenses (specifically excluding any property management fees), (xvi) costs of any service sold to any tenant (including Tenant) or other occupant for which Landlord is entitled to be reimbursed as an additional charge or rental over and above the basic rent and escalations payable under the lease with that tenant, (xvii) overhead profit increments paid to Landlord’s subsidiaries or affiliates for management or other services on or to the Building or for supplies or other materials to the extent that the cost of the services, supplies, or materials exceeds the cost that would have been paid had the services, supplies, or materials been provided by unaffiliated parties on a competitive basis, (xviii) the cost of correcting any building code or other violations which were violations prior to the Commencement Date of this Lease, or costs of alterations required by a change in any Legal Requirements, (xix) the cost of containing, removing, or otherwise remediating any contamination of the Site (including the underlying land and ground water) by any toxic or hazardous materials (including, without limitation, asbestos and “PCB’s”) where such contamination was not caused by Tenant, (xx) costs for sculpture, paintings, or other objects of art (and insurance thereon or extraordinary security in connection therewith), (xxi) wages, salaries, or other compensation paid to any executive employees above the grade of property manager, (xxii) the cost of replacing (as opposed to maintaining and repairing) the roof and the structural components of the Premises and the Building or any of the parking areas at the Site.

(ii) Landlord may, at its sole discretion, bill Tenant monthly, quarterly, semi-annually or annually for Tenant’s Operating Expense Obligation. Any bill for a month, quarter or half-year may be rendered on an estimated basis. Any estimated bill need not include all of the items

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mentioned in Section 3.3(i)(a). Any annual bill shall be rendered on the basis of actual costs only. If Landlord shall render a monthly, quarterly or semi-annual bill on account of any Computation Year, then, within one hundred eighty (180) days after the close of such Computation Year, Landlord shall render an annual bill for such year which annual bill shall make all adjustments as may be necessary to reflect actual changes during that year including, without limitation, any refund that may be due to Tenant, to be taken as a credit against future payments of Additional Rent due hereunder. All bills for Tenant’s Operating Expense Obligation shall be due at the same time and in the same manner as the next monthly installment of Base Rent is due pursuant to Section 3.1, if Landlord has elected to bill Tenant for Tenant’s Tax Obligation on a monthly basis. If, however, Landlord bills Tenant for its Tenant’s Operating Expense Obligation on a quarterly or half-year basis, or if the Lease Term has terminated or expired, then Tenant’s Operating Expense Obligation shall be due within thirty (30) days after receipt by Tenant of a bill therefor.

(iii) If the Term Commencement Date or the expiration or earlier termination of the Lease Term occurs in the middle of a Computation Year, Tenant shall be liable for only that portion of Tenant’s Operating Expense Obligation in respect of such Computation Year represented by a fraction, the numerator of which is the number of days of the herein term which falls within the Computation Year, and the denominator of which is three hundred sixty-five (365).

(iv) Any obligation of Tenant or Landlord under this Section 3.3 which shall not have been paid at the expiration of the Lease Term shall survive such expiration and shall be paid when and as the amount of same shall be determined to be due.

3.4 Audit Right. Provided that Tenant shall have first paid all amounts due and payable by Tenant pursuant to this Article 3, Tenant shall have the right, at its own cost and expense, to audit or inspect Landlord’s records with respect to Operating Expenses and Real Estate Taxes, as well as all other Additional Rent payable by Tenant hereunder for any Computation Year. Tenant shall give Landlord not less than thirty (30) days prior written notice of its intention to conduct any such audit. Any such audit shall be conducted on behalf of Tenant by an independent certified public accountant whose compensation with respect to such audit is not on a contingency basis. Landlord shall cooperate with Tenant during the course of such audit, which shall be conducted during normal business hours in Landlord’s headquarters’ office. Landlord agrees to make such personnel available to Tenant as is reasonably necessary for Tenant, or for Tenant’s employees and or agents to conduct such audit. Tenant and its employees, agents, contractors, representatives, consultants, accountants and attorneys shall use their best efforts to keep the results of any such inspection strictly confidential. If such audit reveals that an error was made in the Operating Expenses and Real Estate Taxes previously charged to Tenant for the Computation Year in question, then Landlord shall provide Tenant with a credit against future payments of Additional Rent in the amount of such overpayment, or Tenant shall pay to Landlord any underpayment of any such costs within thirty (30) days after notification thereof. Tenant may not conduct an inspection or have an audit performed more than once during any Computation Year. Failure of Tenant to provide Landlord with a written request to review such books and records within six (6) months after receipt of expense reconciliation with respect to each respective Computation Year shall be deemed a waiver of Tenant’s rights hereunder with respect to such Computation Year. Failure of Tenant to provide

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Landlord with the results of Tenant’s audit within sixty (60) days of Tenant’s review of Landlord’s books and records shall be deemed a waiver of Tenant’s rights hereunder with respect to such Computation Year.

3.5 Rent. References in this Lease to “Rent” or “rent” shall be deemed to include both Base Rent and Additional Rent when the context so allows. All monetary obligations of Tenant under this Lease, except for the obligation to pay Base Rent, shall be deemed obligations to pay Additional Rent, unless such presumption is repugnant to the context.

3.6 Independent Covenants. Each covenant, agreement, obligation and/or other provision in this Lease to be performed on Tenant’s part shall be deemed and construed to be a separate and independent covenant of Tenant and not dependent on any other provision of this Lease.

3.7 Gross-Up. If the Building is not fully occupied during any calendar year period (including any calendar year(s) falling within the Base Year), then the variable portion of Operating Expenses for such period shall be deemed to be equal to the total of the variable portion of Operating Expenses which would have been incurred by Landlord if ninety-five percent (95%) percent of the rentable area of the Building had been occupied for the entirety of such calendar year with all tenants paying full rent, as contrasted with free rent, half rent or the like.

ARTICLE 4

SECURITY DEPOSIT

Upon the execution and delivery of this Lease, Tenant shall deliver to Landlord a security deposit in the amount of Sixteen Thousand Two Hundred Thirty-Five and 00/100 Dollars ($16,235.00) (the “Security Deposit”). Landlord shall hold the same throughout the Lease Term as security for the performance by Tenant of all obligations on the part of Tenant hereunder. Landlord shall have the right from time to time, without prejudice to any other remedy Landlord may have on account thereof, to apply such Security Deposit, or any part thereof, to Landlord’s damages arising from, or to cure, any default by Tenant of its obligations hereunder beyond the expiration of any applicable grace periods. If Landlord shall so apply any or all of such Security Deposit, Tenant shall immediately upon demand deposit with Landlord the amount so applied to be held as security hereunder. Landlord shall return the Security Deposit, or so much thereof as shall have theretofore not been applied in accordance with the terms of this Section 4.1, to Tenant on the expiration or earlier termination of the Lease Term and the surrender of possession of the Premises by Tenant to Landlord at such time, provided that there is then existing no default of Tenant (nor any circumstance which, with the passage of time or the giving of notice, or both, would constitute a default of Tenant). While Landlord holds such Security Deposit, Landlord shall have no obligation to pay interest on the same and shall have the right to commingle the same with Landlord’s other funds. If Landlord conveys Landlord’s interest under this Lease, the Security Deposit, or any part thereof not previously applied, shall be turned over by Landlord to Landlord’s grantee, and, if so turned over, Tenant agrees to look solely to such grantee for proper application of the Security Deposit in accordance with the terms of this Article 4, and the return thereof in accordance herewith.

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ARTICLE 5

UTILITIES AND SERVICES

5.1 Electricity. It is hereby acknowledged that the Premises are not currently separately metered, and Tenant hereby agrees to pay to Landlord $2.05 per annum per rentable square foot of the Premises for electricity for lights, outlets consumed at the Premises and the heating, ventilating, and air-conditioning (“HVAC”) distribution to the Premises during normal business hours, which amount may be increased from time to time to an amount not to exceed the actual increase in the cost of electricity charged by the utility company, such payment to be made in the same manner and simultaneously with the payment of Rent hereunder. At Landlord’s cost, Landlord reserves the right to separately meter electricity service to the Premises in the future during the Term in which case Tenant would pay the utility company directly for such electricity in lieu of paying the electricity charge described above. Except as specifically provided in this Lease, Landlord shall be under no obligation to furnish any utilities or services to the Premises and shall not be liable for any interruption or failure in the supply of any such utilities or services to the Premises. Tenant acknowledges that such HVAC distribution referenced above shall be provided during normal business hours. At Tenant’s written request, Landlord shall provide additional HVAC distribution to the Premises for an additional cost of $50.00 per hour.

Notwithstanding anything contained in this Lease to the contrary, if (i) an interruption or curtailment, suspension or stoppage of an Essential Service (as said term is hereinafter defined) shall occur, except any of the same due to any act or neglect of Tenant or Tenant’s agents employees, contractors or invitees or any person claiming by, through or under Tenant (any such interruption of an Essential Service being hereinafter referred to as a “Service Interruption”), and (ii) such Service Interruption occurs or continues as a result of the gross negligence or a wrongful conduct of the Landlord or Landlord’s agents, servants, employees or contractors, and (iii) such Service Interruption continues for more than seven (7) consecutive business days after Landlord shall have received notice thereof from Tenant, and (iv) as a result of such Service Interruption, the conduct of Tenant’s normal operations in the Premises is materially and adversely affected, then there shall be an abatement of one day’s Base Rent and Additional Rent for each day during which such Service Interruption continues after such seven (7) business day period; provided, however, that if any part of the Premises is reasonably useable for Tenant’s normal business operations or if Tenant conducts all or any part of its operations in any portion of the Premises notwithstanding such Service Interruption, then the amount of each daily abatement of Base Rent and Additional Rent shall only be proportionate to the nature and extent of the interruption of Tenant’s normal operations or ability to use the Premises. The rights granted to Tenant under this paragraph shall be Tenant’s sole and exclusive remedy resulting from a failure of Landlord to provide services, and Landlord shall not otherwise be liable for any loss or damage suffered or sustained by Tenant resulting from any failure or cessation of services. For purposes hereof, the term “Essential Services” shall mean access to the Premises and electricity, but only to the extent that Landlord has an obligation to provide same to Tenant under this Lease. Any abatement of Base Rent under this paragraph shall apply only with respect to Base Rent allocable to the period after each of the conditions set forth in subsections (i) through (iv) hereof shall have been satisfied and only during such times as each of such conditions shall exist.

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5.2 Landlord’s Services. Landlord, during the Lease Term, shall provide the following services, the cost of which shall be included in the Operating Expenses (except to the extent specifically excluded herein or under Section 3.3(i)(c):

(i) the repair, maintenance and replacement (when necessary or appropriate) of the structural and mechanical components of the Premises and Building, including the roof structure and membrane, the foundation, the exterior walls and all other structural elements of the Building, all mechanical, electrical, plumbing and life-safety systems and all exterior glass (but specifically excluding all interior glass); provided, however, that notwithstanding anything to the contrary contained herein, the cost of replacing (as opposed to maintaining and repairing) the structural components of the Premises and Building shall not be included in Operating Expenses or otherwise charged to Tenant;

(ii) the maintenance of the landscaping on the Site;

(iii) the maintenance, repair and replacement (when necessary or appropriate) of the parking areas located on the Site; provided, however, that notwithstanding anything to the contrary contained herein, the cost of replacing (as opposed to maintaining and repairing) such parking areas shall not be included in Operating Expenses or otherwise charged to Tenant;

(iv) the removal of snow and ice from the parking areas, driveways and walkways located on the Site;

(v) the insurance which Landlord is required to maintain on the site pursuant to Article 6 below;

(vi) the management of the Site; and

(vii) exterior lighting and repair and replacement thereof;

(viii) janitorial services Monday through Friday, excluding holidays;

(ix) the replacement of all light bulbs and ballasts in the Premises, as necessary; provided, however, that the cost thereof shall not be included in Operating Expenses but shall be charged to Tenant directly; and

(x) subject to Section 5.1, HVAC, electricity and water to the Premises and Building.

Landlord shall never be liable for damages caused by its failure to make any repairs required hereunder, provided that Landlord has used reasonable efforts to attempt to have such repair made, after having been notified by Tenant that such repair must be made promptly and that Tenant will be damaged by the failure to make such repairs promptly.

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5.3 Access and Security. Tenant shall have access to the Premises twenty-four (24) hours a day, seven (7) days a week, fifty-two (52) weeks per year. Tenant shall be solely responsible, at Tenant’s sole cost and expense, for security for the Premises.

ARTICLE 6

INSURANCE

6.1 Required Coverage. Tenant covenants and agrees with Landlord that during the Lease Term the following insurance shall be obtained by Tenant and carried at Tenant’s sole expense:

(a) Tenant’s commercial general liability insurance insuring Tenant against liability for injury to persons and damage to property which may be claimed to have arisen out of Tenant’s business operations or its use or occupancy of the Premises or Building, including contractual liability coverage, and with limits at least equal to $2,000,000.00 per occurrence and $2,000,000.00 in the aggregate, or such higher limits in any case as may be customarily carried in Massachusetts by prudent occupants of similar property.

(b) Worker’s Compensation covering all Tenant’s employees working on the Premises, as required by law.

(c) Such additional insurance (including, without limitation, business interruption insurance) as Landlord or Landlord’s Mortgagee shall reasonably require, provided that such insurance is in an amount and of the type customarily carried in Massachusetts by prudent occupants of similar property.

At Tenant’s election, any of the above coverages may be provided by any combination of primary or excess insurance policies.

6.2 Writing and Disposition of Insurance Policies. All insurance required under Section 6.1 above shall be written with companies with ratings by A.M. Best Company of A-VIII or higher and in forms customarily in use from time to time in the Greater Boston area. Tenant shall furnish Landlord certificates of insurance evidencing such coverage on or before the Term Commencement Date. Such certificates shall provide that the coverage thereunder may not be canceled without thirty (30) days prior written notice to Landlord, Landlord’s property manager, Landlord’s Mortgagee (the name and address of which Landlord has provided to Tenant) and Tenant. Tenant agrees that any commercial general liability insurance which Tenant may carry with respect to the Premises shall list Landlord and Landlord’s Mortgagee (the name and address of which Landlord has provided to Tenant) as additional insureds.

6.3 Mutual Waiver of Subrogation. Landlord agrees to insure the Building and Premises (excluding the Tenant’s Property, as defined below) in accordance with Section 6.5 and Landlord’s personal property including its business papers, furniture, fixtures, and equipment (collectively, “Landlord’s Property”). Accordingly, Landlord agrees that Tenant will have no

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liability to Landlord in the event that Tenant damages or destroys, negligently or otherwise, all or any part of Landlord’s Property. Landlord will cause to be placed in its insurance policies covering Landlord’s Property a waiver of subrogation so that its insurance company will not become subrogated to Landlord’s rights and will not be able to proceed against Tenant in connection with any such damage or destruction. Tenant agrees to insure its personal property, including its business papers, furniture, fixtures, and equipment (collectively, “Tenant’s Property”). Accordingly, Tenant agrees that Landlord will have no liability to Tenant in the event Landlord damages or destroys, negligently or otherwise, all or any part of Tenant’s Property. Tenant will cause to be placed in its insurance policies covering Tenant’s Property a waiver of subrogation so that the insurance company will not become subrogated to Tenant’s rights and will not be able to proceed against Landlord in connection with any such damage or destruction. Landlord and Tenant, therefore, each hereby release the other, its officers, directors, employees and agents, from any and all liability or responsibility (to the other or anyone claiming through or under them by way of subrogation or otherwise) for any loss or damage to property covered by valid and collectible insurance (or which would have been covered by such insurance had the releasing party obtained the insurance required under this Lease), even if such loss or damage shall have been caused by the fault or negligence of the other party, or anyone for whom such party may be responsible. Landlord and Tenant each agree that any fire and extended coverage insurance policies will include a clause or endorsement to the effect that any such release shall not adversely affect or impair said policies or prejudice the right of the releaser to recover thereunder, as long as the same shall be obtainable without extra costs, or, if extra cost shall be charged therefor, so long as the other party pays such extra cost. If extra cost shall be chargeable therefor, each party shall advise the other party and of the amount of the extra cost, and the other party, at its election, may pay the same, but shall not be obligated to do so.

6.4 Blanket Policies. Nothing contained herein shall prevent Tenant from taking out insurance of the kind and in the amounts provided for herein under a blanket insurance policy or policies covering properties other than the Premises, provided however, that any such policy or policies of blanket insurance shall, as to the Premises, comply as to endorsements and coverage with the provisions herein.

6.5 Landlord’s Insurance Covenant. Landlord covenants and agrees that, during the Lease Term, it shall obtain all risk insurance against damage by fire or other casualty in an amount equal to the replacement cost of the Building and Premises as reasonably determined from time to time by Landlord. Tenant’s Proportionate Share of the cost of such insurance shall be paid by Tenant as an Operating Expense.

ARTICLE 7

ADDITIONAL COVENANTS

Tenant covenants and agrees during the Lease Term and such further time as Tenant occupies the Premises or any part thereof:

7.1 Performing Obligations. To perform fully, faithfully and punctually all of the obligations of Tenant set forth in this Lease; and to pay when due Rent and all charges, rates and other sums which by the terms of this Lease are to be paid by Tenant.

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7.2 Use. To use the Premises only for the Permitted Uses, and for no other purposes, without the written consent of Landlord, which consent shall not be unreasonably withheld.

7.3 Maintenance and Repair. At Tenant’s expense, and except for reasonable wear and tear and damage from fire or other casualty, to keep the Premises, including, without limitation, all interior glass, all utilities, pipes, conduits, drains, and other installations located within the Premises, clean, neat and in good order, repair and condition. Tenant shall keep the Premises and such installations in as good condition, order and repair as the Premises and such installations are at the Term Commencement Date or such better condition as the Premises or such installations thereafter may be put, reasonable wear and use and damage by fire or other casualty only excepted, it being understood that the foregoing exception for reasonable wear and use shall not relieve Tenant from the obligation to keep the Premises and such installations in good order, repair and condition including, without limitation, all necessary and ordinary non-structural repairs, replacements and the like. Landlord agrees to maintain and repair the HVAC exclusively servicing the Premises. If any HVAC unit exclusively servicing the Premises or any major component thereof such as the compressor or the fan motor needs to be replaced during the Lease Term, Landlord shall be responsible for such replacement, and the entire cost thereof shall be amortized on a straight line basis over a period equal to the useful life thereof for federal income tax purposes and charged to Tenant to the extent of the amortized amount falling within the then remaining Lease Term. Tenant also agrees to abide by reasonable and non-discriminatory rules and regulations which may be adopted by Landlord from time to time, including the Rules and Regulations attached hereto as Exhibit E.

7.4 Compliance with Laws. At Tenant’s sole cost and expense, to comply promptly with all present and future laws, ordinances, orders, rules, regulations and requirements of all federal, state and municipal governments, departments, commissions, boards and officials, foreseen and unforeseen, ordinary as well as extraordinary, which may be applicable to the Premises or to Tenant’s use, occupancy or presence in or at the Premises or the Site, including, as to Tenant’s use of the Premises or as a result of any alterations or additions made by or on behalf of Tenant, except for Landlord’s Work, the Americans with Disabilities Act (“ADA”) and all laws with respect to the handling, storage and disposal of hazardous materials (“Legal Requirements”), except that Tenant may defer compliance so long as the validity of any such Legal Requirement shall be contested by Tenant in good faith and by appropriate legal proceedings, and:

(a) If by the terms of such Legal Requirement, compliance therewith pending the prosecution of any such proceeding may legally be delayed without the incurrence of any lien, charge or liability of any kind against the Premises or Site and without subjecting Tenant or Landlord to any liability, civil or criminal, for failure so to comply therewith, Tenant may delay compliance therewith until the final determination of such proceeding, or

(b) If any lien, charge or civil liability would be incurred by reason of any such delay, Tenant nevertheless may contest as aforesaid and delay as aforesaid, provided that such delay would not subject Landlord to criminal liability or fine, and Tenant (i) furnishes to Landlord security, reasonably

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satisfactory to Landlord, against any loss or injury by reason of such contest or delay, and (ii) prosecutes the contest with due diligence; and

(c) Such delay in compliance will not constitute a default by Landlord under any lease, mortgage or other agreement, will not affect the use of all or any portion of the Site by Landlord or any tenant of the Site, and will not adversely affect the sale, leasing, or refinancing of all or any portion of the Site.

Notwithstanding the foregoing, Landlord shall be responsible for compliance of the Building as initially constructed and the Premises as of the Commencement Date, with all applicable Legal Requirements, including, without limitation, the ADA, and Landlord hereby covenants and agrees to indemnify, defend, and hold Tenant harmless from, any and all costs, damages, claims, liability, judgments, expenses, reasonable attorneys’ fees, and penalties which may arise out of any actual or alleged violations of such legal Requirements or the ADA with respect to the initial construction of the Premises (sometimes herein referred to as the “Landlord’s Work”). During the Term of the Lease, Landlord shall bear the responsibility and cost of complying with the ADA with respect to the common areas and with respect to the Building’s structure and the Building’s utility and life-safety systems, other than compliance that is necessitated by Tenant’s use of the Premises or as a result of any alterations or additions made by or on behalf of Tenant, except for Landlord’s Work.

Notwithstanding anything in this Lease to the contrary, in no event shall Tenant be responsible for any alterations to the Premises required due to a change in Legal Requirements at any time during the Lease Term, either directly or as part of Operating Expenses, other than compliance that is necessitated by Tenant’s use of the Premises or as a result of any alterations or additions made by or on behalf of Tenant, except for Landlord’s Work.

7.5 Payment for Tenant’s Work. To pay promptly when due the entire cost of any work at or on the Premises undertaken by Tenant so that the Premises shall at all times be free of liens for labor and materials; promptly to clear the record of any notice of any such lien; to procure all necessary permits and before undertaking such work; to do all of such work in a good and workmanlike manner, employing materials of good quality and complying with all governmental requirements; and to save Landlord harmless and indemnified from all injury, loss, claims or damage to any person or property occasioned by or growing out of such work, except to the extent such loss, claim or damage is caused by the gross negligence of Landlord, its agents or employees.

7.6 Indemnity. Subject to Section 6.3, to save Landlord harmless and indemnified from, and to defend Landlord against, all injury, loss, claims or damage (including reasonable attorneys’ fees) to any person or property while on the Premises unless arising from any omission, fault, negligence or other misconduct of Landlord, or its agents, servants, employees, or contractors; and to save Landlord harmless and indemnified from, and to defend Landlord against, all injury, loss, claims or damage (including reasonable attorneys’ fees) to any person or property anywhere occasioned by any omission, neglect or default of Tenant or Tenant’s agents, servants, employees, contractors, guests, invitees or licensees.

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Landlord covenants and agrees during the Lease Term and such further time as Tenant occupies the Premises or any part thereof, subject to Section 6.3, to save Tenant harmless and indemnified from, and to defend Tenant against, all injury, loss, claims or damage (including reasonable attorneys’ fees) arising from (i) any willful, negligent or tortious act or omission on the part of Landlord, its agents, contractors, or employees; or (ii) any failure on the part of Landlord to perform or comply with any of the covenants, agreements, terms, provisions, conditions or limitations contained in this Lease on its part to be performed or complied with.

7.7 Personal Property at Tenant’s Risk. That all of Tenant’s personal property, equipment, inventory and the like from time to time upon the Premises shall be at the sole risk of Tenant; and that Landlord shall not be liable for any damage which may be caused to such property or the Premises or to any person for any reason including, without limitation, the bursting or leaking of or condensation from any plumbing, cooling or heating pipe or fixture, except to the extent caused by the gross negligence or willful misconduct of Landlord, its agents and employees and not covered by insurance carried or required to be carried by Tenant under the Lease.

7.8 Payment of Landlord’s Cost of Enforcement. To pay on demand Landlord’s expenses, including reasonable attorneys’ fees, incurred in enforcing any obligation of Tenant under this Lease or in curing any default by Tenant under this Lease, provided that Landlord is successful in enforcing such obligation or has a right under this Lease to cure such default.

7.9 Yield Up. At the termination of this Lease, peaceably to yield up the Premises clean and in good order, repair and condition and in compliance with all applicable Legal Requirements (except to the extent Landlord was required hereunder to comply with such Legal Requirements), reasonable wear and tear and damage by fire or casualty excepted, and to deliver to Landlord all keys to the Premises or any part thereof. Any alteration, addition or improvement in, on, or to the Premises made or installed by Tenant shall become a part of the realty and belong to Landlord without compensation to Tenant upon the expiration or sooner termination of the Term, at which time title shall pass to Landlord under this Lease as if by a bill of sale, unless Landlord elects otherwise and notifies Tenant at the time of installation to remove any such tenant improvements prior to the expiration of the Lease Term. Notwithstanding the foregoing, any and all trade equipment (including but not limited to manufacturing and processing equipment), trade fixtures, furniture, data lines, inventory and business equipment shall remain Tenant’s property and shall be removed by Tenant at the expiration or earlier termination of this Lease. Upon demand by Landlord, Tenant shall remove, at Tenant’s sole cost and expense, forthwith and with all due diligence (but in any event prior to the expiration or earlier termination of the Lease Term), any such alterations, additions or improvements which are designated by Landlord to be removed at the time of installation, and Tenant shall forthwith and with all due diligence, at its sole cost and expense, repair any damage to the Premises or the Building or Site caused by such removal. In the event Tenant fails so to remove any such alterations, additions and improvements or fails to repair any such damage to the Premises, the Building or the Site, Landlord may do so and collect from Tenant the cost of such removal and repair in accordance with Section 7.8 hereof.

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7.10 Subordination. Upon the request of Landlord, to execute and deliver all such instruments as may reasonably be requested to subordinate this Lease to any mortgages or deeds of trust securing notes or bonds executed by Landlord and to all advances made thereunder and to the interest thereon and all renewals, replacements and extensions thereof, provided that Landlord first obtains from Landlord’s Mortgagee and delivers to Tenant a written agreement that provides substantially that so long as no Event of Default has occurred and is then continuing and so long as Tenant performs its obligations under this Lease, no foreclosure of, deed given in lieu of foreclosure of, or sale under the encumbrance, and no steps or procedures taken under the encumbrance, shall affect Tenant’s rights hereunder. Landlord’s Mortgagee may at any time subordinate its mortgage or deed of trust to this Lease, without Tenant’s consent, by notice in writing to Tenant and thereupon this Lease shall be deemed prior to such mortgage or deed of trust without regard to their respective dates of execution, delivery and recording; and in that event such mortgagee or trustee shall have the same rights with respect to the Lease as though it had been executed and delivered (and notice thereof recorded) prior to the execution and delivery and recording of the mortgage or deed of trust. Landlord agrees to use commercially reasonable efforts to obtain a subordination and non-disturbance agreement from the present mortgagee of record in a form reasonably satisfactory to Tenant, provided, however, that Landlord shall not be required to expend any funds in connection therewith.

7.11 Estoppel Certificates. From time to time, upon not less than fifteen (15) days prior written request by Landlord, to execute, acknowledge and deliver to Landlord, for delivery to a prospective purchaser or mortgagee of the Premises or the Site or to any assignee of any mortgage of the Premises or the Site, a statement in writing certifying: (a) that this Lease is unamended (or, if there have been any amendments, stating the amendments); (b) that it is then in full force and effect, if that be the fact; (c) the dates to which Rent and any other payments to Landlord have been paid; (d) any defenses, offsets and counterclaims which Tenant, at the time of the execution of said statement, believes that Tenant has with respect to Tenant’s obligation to pay Rent and to perform any other obligations under this Lease or that there are none, if that be the fact; and (e) such other data as may reasonably be requested. Any such statement may be relied upon by such prospective purchaser or mortgagee of the Premises, or portion thereof, or any assignee of any mortgagee of the Premises, or portion thereof.

7.12 Nuisance. At all times during the Lease Term and such further time as Tenant occupies the Premises, not to injure, overload, deface or otherwise harm the Premises; nor commit any nuisance; nor to do or suffer any waste to the Premises; nor permit the emission of any objectionable noise or odor; nor make any use of the Premises which is improper, or contrary to any Legal Requirement or which will invalidate any insurance policy covering the Premises or any portion thereof, including, without limitation, the handling, storage and disposal of any hazardous material.

7.13 Changes and Alterations. Except as otherwise explicitly set forth herein, Tenant shall have no authority, without the express written consent of Landlord, which consent shall not be unreasonably withheld, conditioned or delayed, to alter, remodel, reconstruct, demolish, add to, improve or otherwise change the Premises, except that Tenant shall have such authority, without the consent of Landlord, to make repairs to the Premises and do such things as are appropriate to

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comply with the obligations imposed on Tenant under other provisions of this Lease and to make “minor alterations” as set forth below.

Tenant shall not construct or permit any alterations, installations, additions or improvements including any interior or exterior signs (“Alterations”) to the Premises or the Building without having first submitted to Landlord plans and specifications therefor for Landlord’s approval, which approval shall not be unreasonably withheld or delayed provided that:

(a) if the improvement involves a sign or will otherwise be visible from the exterior, then the improvement must be reasonably compatible with the architectural and aesthetic qualities of the Premises and the Site. Landlord shall, at its cost, install building standard signage in the lobby of the Building and at the entrance to the Premises; and

(b) the improvement must be non-structural and have no effect on the plumbing, heating and cooling, mechanical, electrical or other systems or services in the Premises, and the improvement (except for signs) must be entirely within the Premises; and

(c) the change, when completed, will not adversely affect the value of the Premises or the Site; and

(d) Tenant demonstrates to Landlord’s satisfaction that the improvement will be made in accordance with all applicable Legal Requirements, using good quality materials and good quality construction practices, and will not result in any liens on the Premises; and

(e) as soon as such work is completed, Tenant will have prepared and provide Landlord with “as-built” plans (in form acceptable to Landlord) showing all such work; and

(f) Tenant will comply with any rules or requirements reasonably promulgated by Landlord in connection with the doing of any work, and if requested by Landlord, Tenant will obtain and maintain Builder’s Risk insurance in connection with such work.

Tenant shall have the right to make “minor alterations” from time to time in the Premises without obtaining Landlord’s prior written consent therefor, provided that all of such work is non-structural, conforms to all of the above requirements in all respects except for (e), and further provided that Tenant provides Landlord with a written description of such work (and such other data as Landlord may request) prior to commencing any such alteration, and further provided that the aggregate cost of such minor alterations may not exceed $10,000 in any twelve (12) month period.

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Notwithstanding anything to the contrary herein, but subject to the requirements of this Section 7.13 (including, without limitation, the requirement that Tenant obtain the prior written consent of Landlord to any such installation, which consent shall not be unreasonably withheld or delayed), Tenant may install, maintain, and replace, in a location to be mutually agreed upon by Landlord and Tenant on the roof of the Building or on the Site, a satellite communications dish and antenna and related equipment. Tenant shall do so at its sole cost and expense and in accordance with all applicable Legal Requirements, and shall defend, indemnify and hold Landlord harmless from and against any claims, costs or expenses incurred by Landlord as a result of such installation, maintenance or replacement by Tenant. At Landlord’s request, Tenant shall coordinate any such roof installation hereunder with Landlord’s roofing contractor. Tenant shall give prior written notice to Landlord of any work by Tenant which shall involve any penetration of the roof, and Landlord, or Landlord’s contractor, shall be present during any such work. Tenant shall deliver to Landlord evidence reasonably satisfactory to Landlord that any roof-mounted equipment is properly secured so as to withstand snow and wind. Any such satellite dish and related equipment and cabling shall remain the property of Tenant during the Lease Term and after the expiration thereof and shall be removed by Tenant at the expiration of the Lease Term in accordance with Section 7.9.

7.14 Financial Statements. So long as Tenant is a corporation whose stock is traded on a public exchange, Tenant shall not be required to furnish Landlord with financial statements. Tenant’s statement of net worth, as reported in its annual report to its shareholders or in any forms required to be submitted to the Securities and Exchange Commission, shall be acceptable in lieu of any financial statements otherwise required hereunder and shall be conclusive with respect to the items reported therein. In the event that Tenant’s stock is not traded on a public exchange, at Landlord’s request, Tenant shall deliver to Landlord a copy, certified by an officer of Tenant as being a true and correct copy, of Tenant’s most recent audited financial statement, or, if unaudited, certified by Tenant’s chief financial officer, as being true, complete and correct in all material respects. Notwithstanding the foregoing, Landlord shall not request financial statements more than once in each consecutive twelve (12) month period during the Term unless (i) Tenant is in default beyond any applicable notice and cure periods, (ii) Landlord reasonably believes that there has been a material adverse change in Tenant’s financial position since the last financial statement provided to Landlord, and/or (iii) requested (a) in connection with a proposed sale or transfer of the Building by Landlord, or (b) by an investor of Landlord, any Landlord Entity or any lender or proposed lender of Landlord or any Landlord Entity. In addition, so long as Tenant is a publicly traded company on an “over-the-counter” market or any recognized national or international securities exchange, the foregoing shall not apply so long as Tenant’s current public annual report (in compliance with applicable securities laws) for such applicable year is available to Landlord in the public domain. Landlord and its employees, agents, officers, members, partners, shareholders, contractors, representatives, consultants, accountants and attorneys shall use their best efforts to keep the contents of any such financial statement strictly confidential.

7.15 Holdover. If Tenant remains in the Premises beyond the expiration of the Lease Term, or sooner following an early termination as provided for herein, such holding over shall not be deemed to create any tenancy, but Tenant shall be a tenant at sufferance only subject to all of Tenant obligations set forth herein, but at a daily rate equal to one hundred fifty percent (150%)

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of the Base Rent, the cost of electricity and all other utilities supplied to the Premises, and all other charges provided for under this Lease with respect to the first sixty (60) days of such holdover period and at a daily rate equal to two hundred percent (200%) of the Base Rent, the cost of electricity and all other utilities supplied to the Premises, and all other charges provided for under this Lease thereafter. The acceptance of a purported rent check following termination shall not constitute the creation of a tenancy at will, it being agreed that Tenant’s status shall remain that of a tenant at sufferance, at the aforesaid daily rate. Any reference in this Lease to Tenant’s obligations continuing during the period of any holdover shall not be deemed to grant Tenant the right to a holdover or imply Landlord’s consent to any such holdover. In addition, Tenant shall be liable for all costs, claims, liabilities and damages arising from or in any manner related to any such holdover including, without limitation, damages payable to the subsequent tenant and related to the loss of a tenant.

ARTICLE 8

QUIET ENJOYMENT

Landlord covenants that Tenant on paying the Rent and performing Tenant’s obligations under this Lease shall peacefully and quietly have, hold and enjoy the Premises throughout the Lease Term or until it is terminated as in this Lease provided without hindrance by Landlord or by anyone claiming by, through or under Landlord.

ARTICLE 9

DAMAGE AND EMINENT DOMAIN

9.1 Fire and Other Casualty. In the event that at any time during the Lease Term the Premises are totally damaged or destroyed by fire or other casualty or substantially damaged so as to render them or a material portion thereof untenantable, then there shall be a just and proportionate abatement of the Rent payable hereunder until the Premises are made suitable for Tenant’s occupancy, and the Lease Term shall be extended, without the necessity of further action by any party, for a period equal to the time during which Rent so abated. In the event of such substantial (or total) damage to the Premises, Landlord shall proceed at its expense and with reasonable diligence to repair and restore the Premises to substantially the same condition they were in immediately prior to such casualty.

Notwithstanding the foregoing, in the event the Premises cannot, in Landlord’s reasonable discretion, be restored to a condition substantially suitable for their intended purpose within one hundred eighty (180) days following the issuance of all permits and approvals required in connection with such restoration, Landlord shall give Tenant written notice of such determination and either Landlord or Tenant may terminate this Lease by written notice given to the other within ninety (90) days after the occurrence of such casualty. In the event the Premises have not been restored to a condition substantially suitable for their intended purpose within one hundred eighty (180) days following the issuance of all permits and approvals required in connection with such restoration, then either Landlord or Tenant may terminate this Lease by written notice given to the other within five (5) business days following such one hundred eighty (180) day period.

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In the event that the Premises are totally damaged or destroyed by fire or other casualty or substantially damaged so as to render them or a material portion thereof untenantable, and such casualty occurs during the last twelve (12) months of the Lease Term, Tenant may terminate this Lease upon written notice to Landlord.

Landlord and Tenant agree that during any period of reconstruction or repair of the Premises, if Tenant elects to continue the operation of its business within the Premises to the extent practicable, Rent for the portion of the Premises rendered untenantable by the damage shall be abated on a prorata basis from the date of damage until the completion of Landlord’s repairs (or until the date of termination of this Lease by Landlord or Tenant as provided above, as the case may be).

9.2 Eminent Domain. Landlord reserves for itself all rights to any damages or awards with respect to the Premises and the leasehold estate hereby created by reason of any exercise of the right of eminent domain, or by reason of anything lawfully done in pursuance of any public or other authority; and by way of confirmation Tenant grants and assigns to Landlord all Tenant’s rights to such damages so reserved, except as otherwise provided herein. Tenant covenants to execute and deliver any instruments confirming such assignment as Landlord may from time to time reasonably request. If all the Premises are taken by eminent domain, this Lease shall terminate when Tenant is required to vacate the Premises or such earlier date as Tenant is required to begin the payments of rent to the taking authority. If a partial taking by eminent domain results in so much of the Premises being taken as to render the Premises or a material portion thereof unsuitable for Tenant’s continued use and occupancy as determined by Landlord in its reasonable discretion, either Landlord or Tenant may elect to terminate this Lease as of the date when Tenant is required to vacate the portion of the Premises so taken, by written notice to the other given not more than ninety (90) days after the date on which Tenant or Landlord, as the case may be, receives notice of the taking. If a partial taking by eminent domain does not result in such portion of the Premises as aforesaid being taken, then this Lease shall not be terminated or otherwise affected by any exercise of the right of eminent domain. Whenever any portion of the Lease Premises shall be taken by any exercise of the right of eminent domain, and if this Lease shall not be terminated in accordance with the provisions of this Section 9.2, Landlord shall, at its expense, proceeding with all reasonable dispatch, provided sufficient condemnation proceeds are available therefor (or, if not, provided Tenant provides additional funds needed above the amount of the condemnation proceeds available) do such work as may be required to restore the Premises or what remains thereof (not including Tenant’s trade fixtures, business equipment and furniture) as nearly as may be to the condition they were in immediately prior to such taking, and Tenant shall at its expense, proceeding with all reasonable dispatch, do such work to its trade fixtures, business equipment and furniture, as may be required. A just proportion of the Rent payable hereunder, according to the nature and extent of the taking shall be abated from the time Tenant is required to vacate that portion of the Premises taken. If the Premises have not been restored to a condition substantially suitable for their intended purpose within one hundred eighty (180) days of the issuance of all permits and approvals required in connection with such restoration, Tenant may elect to terminate this Lease by written notice to Landlord sent within five (5) business days following such one hundred eighty (180) day period.

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ARTICLE 10

DEFAULTS BY TENANT AND REMEDIES

10.1 Tenant’s Default. Each of the following shall be an event of default (“Event of Default”) hereunder: (A) if Tenant shall fail to pay any installment of Base Rent, Additional Rent or any other payment due under this Lease, and such failure shall continue for a period of five (5) business days following Landlord’s notice of same to Tenant, provided that such notice from Landlord shall be in lieu of, and not in addition to, any notice of default required by applicable law, and provided further Landlord shall be obligated to give only two (2) such notices per any twelve (12) month period, with subsequent payment default to be an Event of Default if such failure to pay shall continue for a period of five (5) days from the date such payment is due (without any notice); (B) if Tenant or any guarantor or surety of Tenant’s obligations hereunder shall (i) make a general assignment for the benefit of creditors; (ii) commence any proceeding for relief, or seeking reorganization, arrangement, adjustment, liquidation, dissolution or composition of it or its debts or seeking appointment of a receiver, trustee, custodian or other similar official for it or for all or of any substantial part of its property; (iii) become the subject of any such proceeding which is not dismissed within sixty (60) days after its filing or entry; or (iv) die or suffer a legal disability (if Tenant, guarantor or surety is an individual) or be dissolved or otherwise fail to maintain its legal existence (if Tenant, guarantor or surety is a corporation, partnership or other entity); (C) Tenant shall fail to discharge or bond over any lien placed upon the Premises in violation of this Lease within thirty (30) days after Tenant receives notice that any such lien or encumbrance is filed against the Premises; (D) if Tenant shall fail to comply with any provision of this Lease, other than those specifically referred to hereinabove and, except as otherwise expressly provided therein, such default shall continue for more than thirty (30) days after Landlord shall have given Tenant written notice of such default, or such longer period if such default cannot be reasonably cured within such thirty (30) day period, provided that Tenant diligently commences the cure within the thirty (30) day period and diligently prosecutes such cure to completion; and (E) if Tenant shall abandon the Premises for more than sixty (60) days. Upon the occurrence of an Event of Default, defined as aforesaid, then in any such case, notwithstanding any waiver or other indulgence of any prior default, Landlord may terminate this Lease by written notice to Tenant sent at any time thereafter, but before Tenant has cured or removed the cause for such termination. Such termination shall take effect on the later of (i) the last day of the month in which Tenant receives the notice, or (ii) twenty-one (21) days after Tenant receives the notice, and shall be without prejudice to any remedy Landlord might otherwise have for any prior breach of covenant.

10.2. Landlord’s Election. Upon each occurrence of an Event of Default and so long as such Event of Default shall be continuing, Landlord may at any time thereafter, at its election by written notice to Tenant: (i) terminate this Lease or Tenant’s right of possession, but Tenant shall remain liable as hereinafter provided; and/or (ii) pursue any remedies provided for under this Lease or at law or in equity. Upon the termination of this Lease or termination of Tenant’s right of possession, it shall be lawful for Landlord, without formal demand or notice of any kind, to re-enter the Premises by summary dispossession proceedings or any other action or proceeding authorized by law and to remove Tenant and all persons and property therefrom. If Landlord re-enters the Premises, Landlord shall have the right to keep in place and use, or remove and store all of the fixtures, equipment and other property of Tenant left at the Premises or elsewhere at the

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Site. If Landlord terminates this Lease or terminates Tenant’s right of possession, Landlord may recover from Tenant the sum of (i) all Base Rent, Additional Rent and all other amounts accrued hereunder to the date of such termination, (ii) the costs set forth in Section 10.3 below, and (iii) an amount equal to (A) the Base Rent and Additional Rent which would have been payable by Tenant under this Lease had this Lease not been so terminated (or had Tenant’s right of possession not been terminated) for the period commencing after said termination and ending on the last day of the Lease Term with such amounts becoming due and payable by Tenant on such dates as Base Rent would otherwise become due and payable hereunder, less (B) the net rents received by Landlord from re-letting the Premises (or any portion(s) thereof) for the period commencing after said termination and ending on the last day of the Lease Term, such net rents to be determined by first deducting from the gross rents received by Landlord from such re-letting the expenses incurred or paid by Landlord in connection with said termination and in re-entering the Premises and in securing possession thereof, as well as the actual expenses of re-letting (including, without limitation, altering and preparing the Premises for new tenants and any broker’s commission as determined pursuant to Section 10.3 below). Subject to the provisions of Section 10.4 below, any such re-letting may be for a shorter or longer period than the remaining Lease Term, and in no event shall Tenant be entitled to receive any excess of such net rents over the Base Rent payable by Tenant to Landlord under this Lease. Even though Tenant has breached this Lease and abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all its rights and remedies under this Lease, including the right to recover Base Rent and Additional Rent as it becomes due. Any such payments due Landlord shall be made on the dates that Base Rent or such Additional Rent would otherwise come due under this Lease, and Tenant agrees that Landlord may file suit to recover any sums falling due from time to time. Notwithstanding any such re-letting without termination, Landlord may at any time thereafter elect in writing to terminate this Lease for such previous breach.

10.3. Reimbursement of Landlord’s Expenses. In the case of termination of this Lease or termination of Tenant’s right of possession pursuant to Section 10.2, Tenant shall reimburse Landlord for all actual expenses arising out of such termination, including, without limitation, (i) all costs actually incurred in collecting such amounts due from Tenant under this Lease (including reasonable attorneys’ fees actually incurred and the costs of litigation and the like but only if Landlord is successful in its litigation), (ii) all customary and necessary expenses incurred by Landlord in attempting to relet the Premises or parts thereof (including advertisements, brokerage commissions, tenant’s allowances, lease inducements, costs of preparing space, and the like), and (iii) all Landlord’s other expenditures necessitated by the termination. The reimbursement from Tenant shall be due and payable within thirty (30) days following written notice from Landlord that an expense has been incurred with documentation substantiating such expenses, without regard to whether the expense was incurred before or after the termination.

10.4. Termination of Right of Possession. Even though Tenant has breached this Lease and abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate the Lease (even though it has terminated Tenant’s right of possession), and Landlord may enforce all its rights and remedies under this Lease, including the right to recover Base Rent and Additional Rent as it becomes due. Any such payments due Landlord shall be made on the dates that Base Rent and Additional Rent would otherwise come due under this Lease, and

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Tenant agrees that Landlord may file suit to recover any sums falling due from time to time. Notwithstanding any such termination of possession only, Landlord may at any time thereafter elect in writing to terminate this Lease for such previous breach.

10.5. Mitigation. Landlord shall use commercially reasonable efforts to relet the Premises which efforts shall be subject to the reasonable requirements of Landlord to lease to high quality tenants and to develop the Premises in a harmonious manner with an appropriate mix of uses, tenants, and terms of tenancies, and the like and factoring in the location and nature of the Premises. It is agreed that hiring a reputable leasing broker to lease the Premises and cooperating in good faith with such broker shall satisfy the requirement that Landlord use commercially reasonable efforts to relet.

10.6. Claims in Bankruptcy. Nothing herein shall limit or prejudice the right of Landlord to prove and obtain in a proceeding for bankruptcy, insolvency, arrangement or reorganization, by reason of the termination, an amount equal to the maximum allowed by the statute of law in effect at the time when, and governing the proceedings in which, the damages are to be provided, whether or not the amount is greater to, equal to, or less than the amount of the loss or damage which Landlord has suffered.

10.7. Landlord’s Right to Cure Defaults. Landlord may, but shall not be obligated to cure, at any time any default by Tenant under this Lease after the applicable notice and cure period (if any) has expired. In curing such defaults, Landlord may enter upon the Premises and take such action thereon as may be necessary to effect such cure. In the case of an emergency threatening serious and imminent injury to persons or property, Landlord may cure such default without notice. All costs and expenses incurred by Landlord in curing a default, including reasonable attorneys’ fees actually incurred, together with interest thereon at a rate equal to the lesser of (a) eighteen percent (18%) per annum, or (b) the highest lawful rate of interest which Landlord may charge to Tenant without violating any applicable law from the day of payment by Landlord shall be paid by Tenant to Landlord on demand. Landlord may use the Security Deposit to effectuate any such cure.

10.8. No Waiver. Exercise by Landlord of any one or more remedies hereunder granted or otherwise available shall not be deemed to be an acceptance of surrender of the Premises and/or a termination of this Lease by Landlord, whether by agreement or by operation of law, it being understood that such surrender and/or termination can be effected only by the written agreement of Landlord and Tenant. Tenant and Landlord further agree that forbearance or waiver by either party to enforce its rights pursuant to this Lease, or at law or in equity, shall not be a waiver of such party’s right to enforce one or more of its rights in connection with any subsequent default. A receipt by Landlord of rent with knowledge of the breach of any covenant hereof shall not be deemed a waiver of such breach, and no waiver by Landlord of any provision of this Lease shall be deemed to have been made unless expressed in writing and signed by Landlord. No payment by Tenant, or acceptance by Landlord, of a lesser amount than shall be due from Tenant to Landlord shall be treated otherwise than as a payment on account of the earliest installment of any payment due from Tenant under the provisions hereof. The acceptance by Landlord of a check for a lesser amount with an endorsement or statement thereon, or upon any letter accompanying such check, that such lesser amount is payment in full, shall be given no effect,

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and Landlord may accept such check without prejudice to any other rights or remedies which Landlord may have against Tenant.

10.9 Late Charge; Default Interest. If any payment of Base Rent, Additional Rent or any other payment payable hereunder by Tenant to Landlord shall not be paid when due, Landlord may impose, at its election, a late fee of ten percent (10%) of the overdue amount and interest on the overdue amount from the date when the same was payable until the date paid at a rate equal to the lesser of (a) eighteen percent (18%) per annum, or (b) the highest lawful rate of interest which Landlord may charge to Tenant without violating any applicable law. Such late fee and interest shall constitute Additional Rent payable hereunder.

ARTICLE 11

ASSIGNMENT AND SUBLETTING

11.1 Prohibition. Tenant covenants and agrees that neither this Lease nor the term and estate hereby granted, nor any interest herein or therein, will be assigned, mortgaged, pledged, encumbered or otherwise transferred, and that neither the Premises, nor any part thereof will be encumbered in any manner by reason of any act or omission on the part of Tenant, or used or occupied, or utilized for desk space or for mailing privileges, by anyone other than Tenant, or for any use or purpose other than as stated herein, or be sublet or offered or advertised for subletting, without the prior written consent of Landlord in each and every case, which consent shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything contained herein to the contrary, Tenant shall have no right to advertise publicly to assign this Lease. Not in limitation of the foregoing, Tenant’s request for Landlord’s consent to subletting or assignment shall be submitted in writing no later than thirty (30) days in advance of the proposed effective date of such proposed assignment or sublease, which request shall be accompanied by the following information (the “Required Information”): (i) the name, current address and business of the proposed assignee or subtenant; (ii) the precise square footage and location of the portion of the Premises proposed to be so subleased or assigned; (iii) the effective date and term of the proposed assignment or subletting; and (iv) the rent and other consideration to be paid to Tenant by such proposed assignee or subtenant. Tenant also shall promptly supply Landlord with the most recent unaudited financial statements of the proposed assignee or subtenant certified by an officer thereof and prepared in accordance with generally accepted accounting practices, along with such other information as Landlord may reasonably request, indicating the net worth, liquidity and credit worthiness of the proposed assignee or subtenant in order to permit Landlord to evaluate the proposed assignment or sublease. Tenant agrees to reimburse Landlord for legal fees and any other reasonable expenses and costs incurred by Landlord in connection with any proposed assignment or subletting, not to exceed $3,000.00 in any one instance.

11.2. Conditions to Consent. Notwithstanding anything to the contrary contained herein, it shall not be unreasonable for Landlord to withhold its consent to any proposed assignment or sublease if (i) Tenant proposes to assign this Lease or sublease the Premises or any portion thereof to any person or entity with whom Landlord is then negotiating for the rental of other space in the Building or who is a tenant in the Building or in any building owned by Landlord or its affiliate now or in the future located at 700 or 900 Technology Park Drive, Billerica, Massachusetts; 25 Industrial Ave, Chelmsford, Massachusetts; Billerica Business Center, Billerica and Tewksbury, Massachusetts; 165 Lexington Road, Billerica, Massachusetts; 220 or

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222 Mill Road, Chelmsford, Massachusetts; or 19 or 21 Alpha Road, Chelmsford, Massachusetts; or (ii) with respect to a proposed assignment of this Lease, the net worth of any such proposed assignee is less than the greater of (A) the net worth of Tenant on the date hereof or (B) the net worth of Tenant at the time of any such assignment; or (iii) in Landlord’s reasonable judgment the proposed assignee or subtenant is engaged in a business which is not in keeping with the then standards of the Building and the proposed use is not limited to the Permitted Use; or (iv) there are then two (2) or more leases or subleases in effect with respect to the Premises (including this Lease) (provided, however, that it is hereby agreed and acknowledged that in no event shall Landlord’s right to withhold consent be limited to the basis set forth in clauses (i) through (iv) above, so long as the basis for such withholding is reasonable). Landlord’s consent shall be granted only if the assignee or subtenant shall promptly execute, acknowledge, and deliver to Landlord an agreement in form and substance satisfactory to Landlord whereby the assignee or subtenant shall agree to be bound by and upon the covenants, agreements, terms, provisions and conditions set forth in this Lease other than the payment of Rent hereunder.

11.3 Excess Rents. If Tenant shall sublet the Premises, having first obtained Landlord’s consent, at a rental in excess of the rent and additional rent due and payable by Tenant under the provisions of this Lease, fifty percent (50%) of such excess Rent and Additional Rent net of Tenant’s commercially reasonable and necessary expenses related to the sublease (including, without limitation, brokerage fees, reasonable attorneys’ fees and rent concessions) shall be paid by the Tenant to the Landlord, it being agreed, however, that Landlord shall not be responsible for any deficiency if Tenant shall sublet the Premises at a rental less than that provided for herein.

11.4. Landlord’s Recapture Right. Within thirty (30) days of its receipt of written notice from Tenant that Tenant intends to attempt to sublease the Premises or a specified portion thereof or to assign this Lease as of a date set forth in such notice (the “Recapture Date”), Landlord may cancel this Lease as to the entire Premises in the event of proposed assignment of this Lease or as to so much of the Premises as Tenant has proposed to sublease in the event of a proposed sublease. If Landlord shall elect to cancel this Lease as to all or a portion of the Premises, it shall give Tenant written notice of its election and Tenant shall surrender the Premises or portion thereof for which this Lease has been canceled on such Recapture Date, in accordance with the provisions of this Lease relating to the surrender of the Premises at the expiration or termination of the Lease Term. If the cancellation shall be as to a portion of the Premises only, then the Rent and Additional Rent shall be adjusted proportionately to reflect said cancellation.

11.5 Assignment or Sublease to an Affiliate. Notwithstanding anything to the contrary contained herein, Tenant shall have the right to assign this Lease or sublet the Premises or any part thereof without the prior consent of Landlord to either (x) an entity into or with which Tenant is merged or consolidated, or to which all or substantially all of Tenant’s assets are transferred, or (y) any entity which controls or is controlled by Tenant or is under common control with Tenant (each of (x) and (y) being herein referred to as an “Affiliate”), provided that in the event of a merger, consolidation or sale of all or substantially all of Tenant’s assets, (i) the successor to Tenant has a net worth, computed in accordance with generally accepted accounting principles consistently applied, at least equal to the greater of (1) the net worth of Tenant

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immediately prior to such merger, consolidation or transfer, or (2) the net worth of Tenant herein named on the date of this Lease; and (ii) proof satisfactory to Landlord of such net worth shall have been delivered to Landlord at least ten (10) days prior to the effective date of any such transaction. In the event of any assignment to an Affiliate, the assignee shall agree directly with Landlord, by written instrument in form satisfactory to Landlord in its reasonable discretion, to be bound by all the obligations of Tenant hereunder, including, without limitation, the covenant against further assignment and subletting.

11.6 No Waiver. If this Lease is assigned, or if the Premises or any part thereof is sublet or occupied by anybody other than Tenant, Landlord may, after default by Tenant, collect Rent and/or Additional Rent from the assignee, subtenant or occupant, and apply the net amount collected to the Rent and/or Additional Rent herein reserved, but no such assignment, subletting, occupancy or collection shall be deemed a waiver of this covenant, or the acceptance of the assignee, subtenant or occupant as a tenant, or a release of Tenant from the further performance by Tenant of covenants on the part of Tenant herein contained. The consent by Landlord to an assignment or subletting shall not in any way be construed to relieve Tenant from obtaining the express consent in writing of Landlord to any further assignment or subletting. No assignment, subletting or use of the Premises shall affect the Permitted Use hereunder. Notwithstanding any permitted assignment or subletting, Tenant shall at all times remain directly, primarily and fully responsible and liable for the payment of all sums payable hereunder and for compliance with all the obligations of Tenant hereunder.

ARTICLE 12

NOTICES

All notices required or permitted to be given under this Lease shall be in writing and shall be sent by registered or certified mail, return receipt requested, or by a reputable national overnight courier service, postage prepaid, or by hand delivery and, if to Tenant, addressed to Tenant at the address for Tenant noted on the first page of this Lease, and if to Landlord, addressed to Landlord at the address for Landlord noted on the first page of this Lease, with a copy delivered in the same manner to Dionne & Gass LLP, 131 Dartmouth Street, Suite 501, Boston, Massachusetts 02116, Attn. Sally Michael, Esquire. All notices shall be effective upon delivery to the address of the addressee (even if such addressee refuses delivery thereof). Either party may by notice given aforesaid change its address for all subsequent notices. Except where otherwise expressly provided to the contrary, notice shall be deemed given upon delivery.

ARTICLE 13

NOTICE OF LEASE

Tenant agrees not to record this Lease without Landlord’s consent, but, if the Lease Term is seven (7) years or longer, each party hereto agrees, on the request of the other, to execute a notice of lease in recordable form and complying with applicable law. In no event shall such document set forth the rent or other charges payable by Tenant under this Lease; and any such document shall expressly state that it is executed pursuant to the provisions contained in this Lease, and is not intended to vary the terms and conditions of this Lease. At Landlord’s request, promptly upon expiration of or earlier termination of the Lease Term, Tenant shall execute and

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deliver to Landlord a release of any document recorded in the real property records for the location of the Premises evidencing this Lease, and Tenant hereby appoints Landlord Tenant’s attorney-in-fact, coupled with an interest, to execute any such document if Tenant fails to respond to Landlord’s request to do so within fifteen (15) days. The obligations of Tenant under this Article 13 shall survive the expiration or any earlier termination of the Lease Term.

ARTICLE 14

APPLICABLE LAW, SEVERABILITY, CONSTRUCTION

This Lease shall be governed by and construed in accordance with the laws of Massachusetts and, if any provisions of this Lease shall to any extent be invalid, the remainder of this Lease, and the application of such provisions in other circumstances, shall not be affected thereby. This Lease may be amended only by an instrument in writing executed by Landlord and Tenant. The titles of the several Articles and Sections contained herein are for convenience only and shall not be considered in construing this Lease.

ARTICLE 15

SUCCESSORS AND ASSIGNS, ETC.

15.1 It is understood and agreed that the covenants and agreements of the parties hereto shall run with the land and that no covenant or agreement of Landlord, expressed or implied, shall be binding upon Landlord except in respect of any breach or breaches thereof committed during Landlord’s seisin and ownership of the Premises. If Landlord acts as a Trustee or Trustees of a trust in making this Lease only the estate for which Landlord acts shall be bound hereby, neither any such Trustee executing this Lease as Landlord nor any shareholder or beneficiary of such trust shall be personally liable for any of the covenants or agreements of Landlord expressed herein or implied hereunder or otherwise because of anything arising from or connected with the use and occupation of the Premises by Tenant. Reference in this Lease to “Landlord” or to “Tenant” and all expressions referring thereto, shall mean the person or persons, natural or corporate, named herein as Landlord or as Tenant, as the case may be, and the heirs, executors, administrators, successors and assigns of such person or persons, and those claiming by, through or under them or any of them, unless repugnant to the context. If Tenant or Landlord is a partnership or a firm of several persons, natural or corporate, the obligations of each person executing this Lease as Tenant or Landlord, respectively, shall be joint and several. Any person who signs this Lease for Tenant or for Landlord in a representative capacity personally warrants and represents that he or she is duly authorized to do so.

15.2 It is further understood and agreed that Tenant shall look solely to the estate and property of Landlord in the Premises for the satisfaction of Tenant’s remedies for the collection of a judgment (or other judicial process) requiring the payment of money by Landlord in the event of any default or breach by Landlord with respect to any of the terms, covenants and conditions of this Lease to be observed or performed by Landlord and any other obligations of Landlord created by or under this Lease, and no other property or assets of Landlord or of its partners, beneficiaries, co-tenants, shareholders or principals (as the case may be) shall be subject to levy, execution or other enforcement procedures for the satisfaction of Tenant’s remedies.

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ARTICLE 16

LANDLORD’S ACCESS

Landlord and its authorized agents, employees, subcontractors and representatives shall have the right to enter the Premises at any time during emergencies (Landlord agrees to use reasonable efforts to notify Tenant of any such emergency) and at all reasonable times with reasonable prior notice for any of the following purposes: (a) to determine whether the Premises are in good condition and whether Tenant is complying with its obligations under this Lease; (b) to do any necessary maintenance and to make such repairs, alterations, improvements or additions in or to the Premises as Landlord has the right or obligation to perform under this Lease, as Landlord may be required to do or make by law, or as Landlord may from time to time deem necessary or desirable; (c) to exhibit the Premises to prospective tenants during the last nine (9) months of the Lease Term or during any period while an Event of Default exists hereunder; and (d) to show the Premises to prospective lenders, brokers, agents, buyers or persons interested in an exchange, at any time during the Lease Term.

If, at any time during the last month of the Lease Term, Tenant shall have removed all of Tenant’s property from all or any portion(s) of the Premises, Landlord may, subject to Tenant’s prior consent, immediately enter and alter, renovate and decorate the same, and such acts shall have no effect upon Tenant’s remaining obligations and covenants under this Lease.

ARTICLE 17

CONDITION OF PREMISES

17.1 As Is. The Premises are being delivered to Tenant in their “as is” condition, except as set forth in this Article. Notwithstanding anything to the contrary in this Lease, Landlord warrants that on the Term Commencement Date hereof, the Premises, including the improvements and equipment (including the HVAC, plumbing, electrical, mechanical and life safety systems) therein, shall be in good working order, condition, and repair. Notwithstanding the foregoing, Landlord shall not be liable to Tenant for any breach of the foregoing warranty unless Tenant has notified Landlord within thirty (30) days of the Term Commencement Date of any respect in which the Premises are not, as of the Term Commencement Date, in such good working order, condition and repair and Landlord has failed, within a reasonable time thereafter, to remedy such defect.

17.2 Landlord’s Work. Landlord shall perform the work described in the plans attached as Exhibit D (“Landlord’s Work”) at no cost to Tenant whatsoever. Landlord covenants and represents that Landlord’s Work shall be completed in a good and workmanlike manner and in compliance with all applicable Legal Requirements. Landlord shall pay all the costs incurred by Landlord in connection with the performance of the Landlord’s Work.

ARTICLE 18

WARRANTY REGARDING BROKER

Each of Tenant and Landlord warrant that it was introduced to the Premises by the party or parties named in the Definitions section of this Lease as the “Broker,” and knows of no other

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Broker which was involved in this transaction in any way or is entitled to any brokerage commission or similar fee or charge in connection with this Lease. Tenant an Landlord each agree to indemnify the other party and the Broker (if any) against any costs incurred by either (including attorneys’ fees) if the foregoing warranty is untrue. Landlord shall be solely responsible for paying all brokerage fees to the brokers named in the Definitions section of the Lease.

ARTICLE 19

FORCE MAJEURE

In the event that Landlord or Tenant shall be delayed, hindered in or prevented from the performance of any act required hereunder other than the payment of any Base Rent, Additional Rent or other sums payable hereunder by reason of strikes, lock-outs, labor troubles, inability to procure materials, failure of power (each of the foregoing conditions being of a general nature and not applicable only to, or caused by, the party so delayed), newly enacted restrictive governmental laws or regulations, riots, insurrection, the act, failure to act or default of the other party, war or other reason beyond their reasonable control (“Force Majeure”), then performance of such act shall be excused for the period of the delay and the period for the performance of any such act shall be extended for a period equivalent to the period of such delay. Force Majeure shall not be construed to excuse Landlord or Tenant from making any payments due hereunder in a timely manner as set forth in this Lease or from performing any covenant or obligation imposed under this Lease by reason of the financial inability of Landlord or Tenant. The party claiming Force Majeure shall give written notice of the same as soon as reasonably practicable to the other party, and shall use commercially reasonably efforts to minimize the time period of Force Majeure.

ARTICLE 20

HAZARDOUS MATERIALS

Tenant shall not (either with or without negligence) cause or permit the escape, disposal, release or threat of release of any biologically or chemically active or other Hazardous Materials (as said term is hereafter defined) on, in, upon or under the Premises of the Site. Tenant shall not allow the generation, storage, use or disposal of such Hazardous Materials in any manner not sanctioned by law or by the highest standards prevailing in the industry for the generation, storage, use and disposal of such Hazardous Materials, nor allow to be brought into the Premises or the Site any such Hazardous Materials, except for use in the ordinary course of Tenant’s business, and then only after written notice is given to Landlord of the identity of such Hazardous Materials (such notice shall not be required for reasonable amounts of standard office supplies and cleansing supplies). Hazardous Materials shall include, without limitation, any material or substance which is (i) petroleum, (ii) asbestos, (iii) designated as a “hazardous substance” pursuant to Section 311 of the Federal Water Pollution Control Act, 33 U.S.C. §1251 et seq. (33 U.S.C. §1321) or listed pursuant to §307 of the Federal Water Pollution Control Act (33 U.S.C. §1317), (iv) defined as a “hazardous waste” pursuant to Section 1004 of the Resource Conservation and Recover Act, 42 U.S.C. 6901 et seq. (42 U.S.C. §6903), (v) defined as a “hazardous substance” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. §9601 et seq. (42 U.S.C. §9601), as amended, or (vi) defined as “oil” or a “hazardous waste”, a “hazardous substance”, a “hazardous material” or a “toxic material” under any other law, rule or regulation applicable to the Property, including,

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without limitation, Chapter 21E of the Massachusetts General Laws, as amended. If any lender or governmental agency shall ever require testing to ascertain whether or not there has been any release of Hazardous Materials, then the reasonable costs thereof shall be reimbursed by Tenant to Landlord upon demand as additional charges but only if such requirement applies to the Premises and is the result of the acts or omissions of Tenant. In addition, Tenant shall execute affidavits, representations and the like, from time to time, at Landlord’s request concerning Tenant’s best knowledge and belief regarding the presence of Hazardous Materials in the Premises or the Site. In all events, Tenant shall indemnify and save Landlord harmless from any claims based on the release on threat of release or the presence or existence of Hazardous Materials in the Premises or the Site caused by Tenant or persons acting under Tenant. The within covenants and indemnity shall survive the expiration or earlier termination of the Lease Term. Landlord expressly reserves the right to enter the Premises to perform regular inspections. Landlord agrees to save Tenant harmless and to indemnify Tenant from and against any liability, injury loss, claim, damage, settlement, attorneys’ fees, fines, penalties, interest or expense which may be incurred by Tenant (including, without, limitation, any cost which Landlord may incur for testing and remediation) arising from any release, presence or existence of Hazardous Materials which existed on the Site prior to Tenant’s occupation of the Premises. In no event shall Tenant be responsible for any Hazardous Materials existing on the Premises as of the Commencement Date.

ARTICLE 21

EXTENSION PERIOD

20.1 Option to Extend Lease Term. Tenant shall have one (1) right and option, which said option shall not be severed from this Lease or separately assigned, mortgaged or transferred, at its election, to extend the Original Lease Term for an additional period of three (3) years (the “Extension Period’) commencing upon the expiration of the Original Lease Term, provided that (a) Landlord shall receive written notice from Tenant of the exercise of its election at least nine (9) months prior to the expiration of the Original Lease Term but no sooner than twelve (12) months prior to the expiration of the Original Lease Term, (b) no Event of Default shall exist at the time of Landlord’s receipt of such notice and at the expiration of the Original Lease Term; and (c) the original Tenant named herein or any Affiliate is itself occupying the entire Premises both at the time of giving the applicable notice and at the commencement of the Extension Period. If Landlord shall receive notice of the exercise of the election in the manner and within the time provided aforesaid, the Original Lease Term shall be extended upon the receipt of the notice without the requirement of any action on the part of Landlord or Tenant, except as may be required in order to determine Base Rent as hereinafter provided. Except for the amount of Base Rent (which is to be determined as hereinafter provided), all the terms, covenants, conditions, provisions and agreements in the Lease contained shall be applicable to the Extension Period, except that there shall be no further options to extend the Lease Term nor shall Landlord be obligated to make or pay for any improvements to the Premises nor pay any inducement payments of any kind or nature. Landlord hereby reserves the right, exercisable by Landlord in its sole discretion, to waive (in writing) any condition precedent set forth in clauses (a), (b) or (c) above. Time is of the essence with respect to the exercise of the option contained herein. Tenant shall not have the right to give any notice exercising such option after the expiration of the applicable time limitation set forth herein, and any notice given after such time limitation

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purporting to exercise such option shall be void and of no force or effect, unless Landlord has waived in writing clause (a) above.

20.2 Determination of Option Rent. During the Extension Period, the Base Rent payable hereunder for the Extension Period shall be adjusted as of the commencement of the Extension Period so as to equal the then “fair market rent”, as mutually determined by Landlord and Tenant through the process of negotiation, but shall in no event shall the “fair market rent” be less than the Base Rent per annum for and with respect to the last twelve (12) calendar months of the Original Lease Term. Notwithstanding anything to the contrary contained herein, however, if for any reason Landlord and Tenant shall not agree in writing upon the “fair market rent” for the Extension Period at least six (6) months prior to the commencement of the Extension Period, then the fair market rent for premises of the size and nature of the Premises shall be determined by licensed real estate brokers having at least five (5) years’ experience in the leasing of commercial real estate in the Greater Boston, Massachusetts area, one such broker to be designated by each of Landlord and Tenant. If either party shall fail to designate its broker by giving notice of the name of such broker to the other party within fifteen (15) days after receiving notice of the name of the other party’s broker, then the broker chosen by the other party shall determine the fair market rent and his determination shall be final and conclusive. If the brokers designated by Landlord and Tenant shall disagree as to the fair market rent, but if the difference between their estimates of fair market rent shall be five percent (5%) or less of the greater of the estimates, then the average of their estimates shall be the fair market rent for purposes hereof. If the brokers designated by Landlord and Tenant shall disagree as to the amount of fair market rent, and if their estimates of fair market rent shall vary by more than five percent (5%) of the greater of said estimates, then they shall jointly select a third broker meeting the qualifications set forth above, and his estimate of fair market rent shall be the fair market rent for purposes hereof if it is not greater than the greater of the other two estimates and not less than the lesser of the other two estimates. If said third broker’s estimate is greater than the greater of the other two estimates, then the greater of the other two estimates shall be the fair market rent for purposes hereof; and if the estimate of the third broker shall be less than the lesser of the other two estimates, then the lesser of the other two estimates shall be the fair market rent for purposes hereof. Each of Landlord and Tenant shall pay for the services of its broker, and if a third broker shall be chosen, then each of Landlord and Tenant shall pay for one-half of the services of the third broker.

20.3. Annual Increases in Option Rent. Commencing with the second Lease Year of the Extension Period and for and with respect to each subsequent lease year during the Extension Period, the Base Rent shall be adjusted and increased (but never decreased) by an amount (the “Annual Adjustment”) equal to the CPI Percentage (as said term is hereinafter defined) multiplied by the Base Rent for the immediately preceding Lease Year (inclusive of all prior Annual Adjustments). For purposes of this provision, a “Lease Year” shall be each twelve (12) calendar month period beginning on that certain date which is the commencement date of the second year of the Extension Period (the “Lease Year Commencement Date”) and ending on the day prior to the second anniversary of each Lease Year Commencement Date and each succeeding twelve (12) calendar month period. In no event shall the Annual Adjustment ever be less than zero or ever result in a reduction in the Base Rent below the Base Rent for the prior Lease Year. As used herein, the term “CPI Percentage” shall mean the percentage increase, if

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any, in the Consumer Price Index (1982-84 = 100) for the Urban Wage Earners and Clerical Workers, All Items, published by the Bureau of Labor Statistics of the United States Department of Labor for Boston, MA (the “Index”) (or if there ceases to be such publication, any other substantially equivalent index selected by Landlord which is generally recognized to measure changes in the cost of living for Boston, Massachusetts), between the Index published on that certain date (the “Index Date”) which is three (3) calendar months prior to the date of commencement of the Lease Year within the Extension Period for which an Annual Adjustment is to be made and the Index last published prior to twelve (12) calendar months prior to the Index Date.

[SIGNATURES ON THE NEXT PAGE]

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IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be duly executed, under seal, by persons hereunto duly authorized, as of the date first set forth above.

LANDLORD:

Billtech Equity Partners, LLC,
a Delaware limited liability company
By:	KC Everest, LLC, a Massachusetts limited liability company, its Manager
By:	/s/ Kambiz Shahbazi
	Kambiz Shahbazi
	Managing Member

TENANT:

Danger, Inc., a Delaware corporation

By:	/s/ Henry R. Nothhaft
	Name:	Henry R. Nothhaft
	Title:	CEO
	Hereunto duly authorized

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EXHIBIT A

PLAN OF THE PREMISES

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EXHIBIT B

SITE PLAN

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EXHIBIT C

LEGAL DESCRIPTION OF THE SITE

700 Technology Park Drive

The land at Technology Park Drive, Billerica, Middlesex County, Massachusetts, shown as “Lot B – 3.091 Acres” on a plan entitled “Subdivision of Land in Technology Park Billerica, Massachusetts property of Technology Park VIII Limited Partnership” dated August 20, 1985 by Earle W. Soper, Jr., Registered Land Surveyor, recorded with Middlesex North District Deeds in Plan Book 150, Plan 1, and more particularly bounded and described as follows:

Beginning at a point (POB) on the westerly side line of Technology Park Drive marking the southeasterly corner of Lot B and the northeasterly corner of Lot A; thence turning and running S 71 Degrees-28 – 57” W a distance of one hundred and ten and thirty-five hundredths (110.35) feet by Lot A, to a corner; thence turning and running S 10 Degrees– 49 – 01” W three hundred and fifty-two and forty-six one hundredths (352.46) feet by Lot A, once again to a corner; thence turning and running by the land of Honeywell Information Systems, Inc. (An abandoned R.R. Spur) on a curved line to the right having a radius of one thousand four hundred and sixteen and nineteen one hundredths (1416.19) feet and a length three hundred and seventy-three and seventy-three one hundredths (373.73) feet respectively, to a point marking the northwesterly corner of Lot B and southerly side of Technology Park Drive; thence turning and running easterly by Technology Park Drive on a curve to the right having a radius of two hundred and sixty (260.00) feet and a length of three hundred and seventy-nine and twenty-seven one hundredths (379.27) feet; thence turning and running S 18 Degrees-31’ – 03” B a distance of one hundred and fifty-seven and twenty-six hundredths (157.26) feet, to a corner on the westerly side of Technology Park Drive being the point of beginning (POB).

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EXHIBIT D

LANDLORD’S WORK

• Demo those walls as indicated on the attached plan

• Matching existing construction, construct approximately 70 liner feet of sheet rock walls, to the existing ceiling, as indicated on the attached plan reusing all existing doors and frames

• Furnish and install 9 locking lever sets with 2 keys per door

• Furnish and install one 4’x8’x3/4” fire treated plywood for telephone room

• The existing kitchen cabinets shall be replaced with a new 6’ unit and new laminate counter top. The break room will also receive a 5 gallon hot water heater above the sink, an instant hot water spigot, a dishwasher and a  ¹/2 horsepower garbage disposal.

• Furnish and install 6’ of upper and lower kitchen cabinets with laminate counter top in the copy/fax area

• Furnish and install laminate counter top and melamine wall mounted shelving above the counter in test lab

• Furnish and install a 2 ton ductless split HVAC unit in the MDF room

• Readjust or relocate the existing HVAC duct work and diffusers to accommodate the new layout

• Replace any damaged or soiled ceiling tiles with a match as close as possible

• Tenant shall complete all data and telephone wiring

• Electrical consists of the following:

1. Make safe from demolition

2. Rewire large office overhead lighting, existing fixtures will be reused.

3. Rewire the existing overhead light switching to accommodate the new layout

4. Insure all existing overhead lighting is fully operational and re-lamped with 3500k bulbs

5. Provide power to the vendor supplied feed for the cubicles at the rate on one 20 amp 110volt circuit per each 3 cubes (10 circuits), tenant to provide power poles if electrical feeds cannot be run inside a wall or interior lally column

6. Furnish and install one floor mounted duplex outlet with provision for data (data by tenant) in the center of 2 conference rooms

7. Furnish and install continuous wall mounted Wire Mold 4000 series (data/power) with duplex outlets at 18”o/c the full length of the test lab counter top

8. Furnish and install 1 dedicated 110v 30 amp and 2 dedicate 110v 20 amp duplex outlets, 2 regular duplex outlets and one 208v 30 amp outlet in the MDF room.

9. Furnish and install 2 – dedicated 110v 20amp duplex outlets and 2 duplex outlets above break room counter

10. Furnish and install 1 110v 20amp dedicated duplex outlet and 3 duplex outlets above the counter in the copy/fax area

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11. Furnish and install a continuous conduit from the telephone room to the MDF room

• Replace the carpet in the entire suite, except those areas noted as being tiled with vinyl composition floor tile, using Landlord’s standard carpet (16.50/ sq yd allowance), color to be selected by Tenant

• Furnish and install 4” vinyl cove base with toe throughout the suite color to compliment the carpet selection

• Strip and wax all existing tile floors (Note: landlord not responsible for pre-existing stains, scratches or gouges in existing tile). Any broken or cracked tile will be replaced in a similar color/style.

• Paint all walls to match as close as possible to existing color from Landlord’s stock selection book. All door frames will be painted in semi-gloss paint and the doors will be lightly sanded and one coat of poly or paint applied

• The existing window treatments will be repaired and fully operational.

• A construction clean up will be completed at the end of the project

• Any changes requested of this scope of work during construction will be at tenants sole cost and expense. All change orders will be approved by Tenant in writing and the funding for the change order will be required in advance of the work starting.

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EXHIBIT E

RULES AND REGULATIONS

The following rules and regulations shall apply to the Premises, the Building and the Site, and the appurtenances thereto. In the event of any inconsistency between the Lease and these Rules and Regulations, the provisions of the Lease shall control.

1. Sidewalks, doorways, vestibules, halls, stairways, and other similar areas shall not be obstructed by tenants or used by any tenant for purposes other than ingress and egress to and from their respective premises and for going from one to another part of the Building.

2. Plumbing fixtures and appliances shall be used only for the purposes for which designed, and no sweepings, rubbish, rags or other unsuitable material shall be thrown or deposited therein. Damage resulting to any such fixtures or appliances from misuse by a tenant or its agents, employees or invitees, shall be paid by such tenant.

3. No signs, advertisements or notices shall be painted or affixed on or to any windows or doors or other part of the Building without the prior written consent of Landlord, which shall not be unreasonably withheld. No nails, hooks or screws shall be driven or inserted in any part of the Building except by Building maintenance personnel. No curtains or other window treatments shall be placed between the glass and the Building standard window treatments.

4. Movement in or out of the building of furniture or office equipment, or dispatch or receipt by tenants of any bulky material, merchandise or materials shall be conducted so as to minimize any interference with the operations of other tenants and occupants and in such a manner a Landlord may reasonably require. Each tenant assumes all risks of and shall be liable for all damage to articles moved and injury to persons or public engaged or not engaged in such movement, including equipment, property and personnel of Landlord if damaged or injured as a result of acts in connection with carrying out this service for such tenant, subject to Section 6.3 of the Lease.

5. Landlord may prescribe reasonable weight limitations and determine the locations for safes and other heavy equipment or items, which shall in all cases be placed in the Building so as to distribute weight in a manner acceptable to Landlord which may include the use of such supporting devices and Landlord may require. Subject to Section 6.3 of the Lease, all damages to the Building or the Site caused by the installation or removal of any property of a tenant, or done by a tenant’s property while in the Building or at the Site, shall be repaired at the expense of such tenant.

6. No birds or animals shall be brought into or kept in, on or about any tenant’s premises. No portion of any tenant’s premises shall at anytime be used or occupied as sleeping or lodging quarters.

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7. Tenant shall cooperate with Landlord’s employees in keeping the Building and the Site neat and clean.

8. Tenant shall not make or permit any vibration or improper, objectionable or unpleasant noises or odors in the Building or otherwise interfere in any way with other tenants or persons having business with them.

9. Landlord will not be responsible for lost or stolen personal property, money or jewelry from tenant’s premises or public or common areas regardless of whether such loss occurs when the area is locked against entry or not.

10. No vending or dispensing machines of any kind may be maintained in any premises without the prior written permission of Landlord, but in any event not more than one (1).

11. Tenant shall not conduct any activity on or about the premises or Building which will draw pickets, demonstrators, or the like.

12. All vehicles are to be currently licensed, in good operating condition, parked for business purposes having to do with Tenant’s business operation in the Premises, parked within designated parking spaces, one vehicle to each space. No vehicle shall be parked as a “billboard” vehicle in the parking lot. Any vehicle parked improperly may be towed away. Tenant, Tenant’s agents, employees, vendors and customers (“Tenant Parties”) who do not operate of park their vehicles as required shall subject the vehicle to being towed at the expense of the owner or driver. Landlord may place a “boot” on the vehicle to immobilize it and may levy a charge to remove the “boot”. Tenant shall indemnify, hold and save harmless Landlord of any liability arising from the towing or booting of any vehicles belonging to a Tenant Party.

13. No tenant may enter into phone rooms, electrical rooms, mechanical rooms, or other service areas of the Building unless accompanied by landlord or the Building manager.

14. Canvassing, soliciting, and peddling in the Building are prohibited and Tenant shall cooperate to prevent the same.

15. Tenant shall keep the premises free at all times of pests, rodents and other vermin, and at the end of each business day Tenant shall place for collection in the place or places provided therefor all trash and rubbish then in the premises.

16. Landlord reserves the right to rescind, alter, waive and/or establish any rules and regulations, which, in its judgment, are necessary, desirable or proper for its best interests and the best interests of the occupants of the Building.

17. All of the work done by Tenant shall be done by such contractors, labor and means so that, as far as may be possible, all work on the Site or in the Building, whether by Landlord or Tenant, shall be done without interruption on account of strikes, work stoppages or similar causes of delay.

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18. The Building is a smoke free building, and Tenant shall cause its employees and invitees who smoke to restrict such smoking to areas designated as “smoking areas” by Landlord from time to time.

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EX-10.27

Exhibit 10.27

MCI SERVICE AGREEMENT

Danger Inc.		Danger Inc.
3101 Park Blvd.
		/s/ Hank Nothhaft	10/08/04
Palo Alto, CA 94306		Hank Nothhaft, Chief Executive Officer	Acceptance Date
MCI — Office Use Only		MCI WORLDCOM Communications, Inc.
Corp. ID:	Segment: NA
Contract: 452120-03	Billing Code: 01/4A/4M	/s/ Nancy B. Gofus	10/14/04
Sales Rep: Matthew Bryant (408) 533-4017		Nancy B. Gofus,	Acceptance Date
		Senior Vice President Product Management

This Agreement, together with Attachments and Schedules (“Agreement”), is made by and between MCI WORLDCOM Communications, Inc (“MCI”) on behalf of Itself and Its affiliates and successors and Danger Inc. (“Customer”). This Agreement is binding upon execution by Customer and service and account activation by MCI. The rates, discounts, charges and credits set forth herein shall be effective the first day of the first full billing cycle following the acceptance and execution of this Agreement by MCI (“Effective Date”). Acceptance of this Agreement by MCI is subject to Customer meeting MCI’s standard credit requirements, which may be based on commercially available credit reviews to which Customer hereby consents

MILESTONE CREDIT. No later than the end of the [ * ] month of the Term (post-ramp period), Customer’s MCI account representative will calculate a credit that will compensate Customer for [ * ] prior to Customer’s [ * ] by Customer (“Milestone Credit”). By way of example Customer’s [ * ]. Customer’s MCI account representative will credit Customer, [ * ]. [ * ] shall consist of Customer’s [ * ], which shall mean Customer’s [ * ]. Under no circumstances will MCI’s total Milestone Credit exceed $[ * ], nor shall any Milestone Credit apply if any delays in Customer’s [ * ] are caused by Customer. In addition, no credits shall accrue during delays in Customer’s [ * ] where the delay was caused by Customer. Any credit under this Section will be a [ * ] provided to Customer pursuant to an amendment to this Agreement.

ACCEPTANCE DEADLINE. This document shall be of no force and effect and the offer contained in it shall be withdrawn, unless this Agreement is executed by the Customer and delivered to MCI on or before November 08 2004

TERMS AND CONDITIONS

1. SERVICES. MCI will provide to Customer the following International Interstate intrastate and local communications services: Option 1 Access (Network), Option 4 Access (Network), Option 4 Data Center Services—Premium Option 4 Data Center Services- Premium IP Bandwidth, Option 1 Private Line—Domestic MC and Option 1 Private Line—Metro (“Services”) and those identified in the Services Attachments to this Agreement which are incorporated by reference

2. TARIFF AND GUIDE. MCI’s provision of Services to Customer will be governed by MCI’s International, Interstate and state tariffs (Tariff(s)”) and MCI’s “Service Publication and Price Guide” (“Guide”), each as supplemented by this Agreement This Agreement Incorporates by reference the terms of each such Tariff and Guide. The Guide is available to Customer on MCI’s Internet website (vmw.mci.com) (“Website”) and at MCI’s offices during regular business hours at 22001 Loudoun County Parkway, Ashburn, VA 20147. MCI may modify the Guide from time to time, and any modification will be binding upon Customer. Except for new services. service features, service options, or service promotions, which will become effective Immediately upon their posting in the Guide on the Website, any modification made to the Guide will become effective beginning as the first day of the next calendar month following Its posting on the Website or, thereafter, on the first day of the next service billing cycle whenever adjustments are made to rates or charges, provided that no modification shall become effective and binding on Customers until it has been posted in the Guide for at least fifteen (15) calendar days. The contractual relationship between MCI and Customer shall be governed by the following order of precedence: (i) the Tariffs to the extent applicable, (ii) the provisions of this Agreement, (with services-specific terms having precedence over general terms), and (iii) the Guide. Capitalization terms defined in this Agreement (including attachments incorporated by reference) have the meaning given them in this Agreement

3. CHANGES TO THE GUIDE. If MCI makes any changes to the Guide (other than changes to Governmental Charges referenced below) which affect Customer in a material and adverse manner, Customer, as its sole remedy, may discontinue the affected Service without liability by providing MCI with written notice of discontinuance within sixty (60) days of the date such change is posted on the Website. Customer shall pay all charges incurred up to the time of Service discontinuance. MCI may avoid Service discontinuance if within sixty (60) days of receipt of Customer’s written notice, it amends this Agreement to eliminate the applicability of the material and adverse change. If a Service is discontinued hereunder, Customer’s AVC (as defined below), will be reduced, as appropriate, to accommodate the discontinuance. A “material and adverse change” shall not include nor be interpreted to include, (1) the introduction of a new service or any new service feature associated with an existing service, including all terms, conditions and prices relating thereto or (ii) the imposition of or changes to Governmental Charges

4. TERM, The “Initial Term” shall begin on the expiration of the Ramp Period and end upon the completion of forty-eight (48) months. The “Ramp Period” shall begin on the Effective Date and continue for a period of two (2) months following the Effective Date. Commencing with the Effective Date and at all times during the Ramp Period thereafter, Customer will receive the rates, discounts, charges and credits set forth herein and will not be subject to the AVC. The Agreement will be automatically extended for periods of twelve (12) months each (“Annual Extended Term”) upon the expiration of the Initial Term, unless either party has delivered written notice of its intent to terminate the Agreement at least sixty (60) days prior to the end of the Initial Term. Either party may terminate this Agreement during an Extended Term upon sixty (60) days prior written notice. Notwithstanding the foregoing, with thirty (30) days written notice prior to the beginning of the next Annual Extended Term or prior to any termination of this Agreement

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

(other than a termination pursuant to the “Termination for Cause” Section due to Customer’s breach), Customer may automatically extend the Agreement on a month to month basis for a maximum of (6) months (“Monthly Extended Term”). During each Monthly Extended Term, Customer will receive the rates, discounts charges and credits set forth herein and will not be subject to the AVC. Customer’s right to extend the Agreement hereunder maybe referred to herein as the “Transition Right.” Term shall mean the Initial Term Annual Extended Term and Monthly Extended Term

5. MINIMUM ANNUAL VOLUME COMMITMENT (“AVC”). Customer agrees to pay MCI no less than [ * ] dollars ($[ * ]) in Total Service Charges (as hereinafter defined) during each Contract Year. A “Contract Year” shall mean each consecutive twelve-month period of the Initial Term commencing on the expiration of the Ramp Period. During each Annual Extended Term, Customers Total Service Charges must equal or exceed the AVC. “Total Service Charges” shall mean all charges, after application of all discounts and credits, incurred by Customer for Services provided under this Agreement, specifically excluding: (i) taxes, tax-like charges and tax-related surcharges: (ii) charges for equipment (unless otherwise expressly stated herein): (iii) charges incurred for goods or services where MCI or MCI affiliate acts as agent (or Customer in its acquisition of goods or services; (iv) non-recurring charges; (v) “Governmental Charges” as defined below’ (vi) international pass-through access charges (i.e., Type 3/PTT) and charges for international access provided by MCI (i.e. Type 1); and (vii) other charges expressly excluded by this Agreement

6. UNDERUTILIZATION CHARGES. If, in any Contract Year during the Initial Term, Customer’s Total Service Charges do not meet or exceed the AVC, then Customer shall pay: (a) all accrued but unpaid usage and other charges incurred under this Agreement; and (b) an “Underutilization Charge” in an amount equal to [ * ] the difference between the AVC and Customer’s Total Service Charges during such Contract Year. If in any Annual Extended Term, Customer’s Total Service charges do not meet or exceed the AVC then Customer shall pay: (a) all accrued but unpaid usage and other charges turned under this Agreement, and (b) an “Underutilization Charge” equal to the difference between the AVC and Customer’s Total Service Charges during such period.

7. EARLY TERMINATION CHARGES. If: (a) Customer terminates this Agreement during the Initial Term for reasons other than Cause; or (b) MCI terminates this Agreement for Cause pursuant to the Sections entitled “Termination for Cause” or “Termination by MCI” then Customer will pay, within thirty (30) days after such termination: (i) [ * ], plus (ii) an amount equal to [ * ] plus (iii) a [ * ]

8. RATES AND CHARGES. Customer agrees to pay the rates and charges specified in this Agreement (including rates and charges incorporated by reference). In the event (i) Customer receives any services that are not the subject of rates, charges and discounts expressly specified in this Agreement, or (ii) Customer purchases any services after the expiration of the Term, Customer shall pay MCI’s standard rates as set forth in the Guide (or Tariffs, if applicable) for those services. As used in this Agreement in connection with rates and charges, “standard” refers to rates and charges for MCI Business Services I (“MBSI”) where applicable. Except where explicitly stated otherwise for a particular service, all rates and charges are subject to change and all discount percentages set forth in this Agreement are fixed for the term of the Agreement. Except where explicitly stated otherwise, Customer will not be eligible to receive any other additional discounts, promotions and/or credits (Tariffed or otherwise). Except where explicitly stated otherwise, the rates end charges set forth in this Agreement do not include (without limitation) charges for all possible non-recurring charges, access service, local exchange service access/egress (or related) charges imposed by a third party other than MCI or an MCI affiliate, Internet service on-site installation, applicable sales, use, excise, utility, and gross receipts taxes and other similar tax-like surcharges, governmental charges, network application fees customer premises equipment or extended wiring to or at Customer premises

9. GOVERNMENTAL CHARGES MCI may adjust its rates and charges or impose additional rates and charges in order to recover amounts it is required or permitted by governmental or quasi-governmental authorities to collect from or pay to others in support of statutory or regulatory programs (“Governmental Charges”) Examples of such Governmental Charges include but are not limited to, Universal Service funding, and compensation payable to payphone service providers for use of their payphones to access MCI’s service

10. TAXES. All Tax-related provisions of the Guide are specifically incorporated by reference herein. In accordance with the Guide, all charges are exclusive of applicable Taxes (as the term is defined in the Guide), which Customer shall pay. However, if applicable, MCI will exempt Customer in accordance with law, effective on the date MCI receives a valid exemption certificate for Customer. If Customer is required by the laws of any foreign tax jurisdiction to withhold income or profit taxes from a payment, Customer will, within ninety (90) days of the date of the withholding, provide MCI with official tax certificates documenting remittance of the taxes to the relevant tax authorities The tax certificates must be in a form sufficient to document qualification of the income or profit tax for the foreign tax credit allowable against MCI’s U S. corporation income tax and accompanied by an English translation. Upon receipt of the tax certificate MCI will issue Customer s billing credit for the amounts represented thereby

11. PAYMENT Customer agrees to pay MCI for all undisputed Services within thirty (30) days of invoice date Payments must be made at the address designated on the invoice or other such place as MCI may designate. Undisputed amounts not paid on or before thirty (30) days from invoice date shall be considered past due and Customer agrees to pay a late payment charge equal to the lesser of: (a) one and one-half percent (1.5%) per month, compounded, or (b) the maximum amount allowed by law, as applied against the past due amounts. Customer must give MCI written notice of a dispute with respect to MCI charges or application of taxes within six (6) months of the date of an invoice, or such invoice shall be deemed to be correct and binding on Customer. Customer shall be liable for the payment of all fees and expanses, including attorney’s fees, reasonably incurred by MCI in correcting or attempting to collect any charges owed hereunder

12. TERMINATION FOR CAUSE. Either party may terminate Agreement for Cause. As to payment of invoices “Cause” shall mean the Customer’s failure to pay any undisputed portion of an invoice within thirty (30) days after the date of the invoice. For all other matters “Cause” shall mean a breach by the other party of any material provision of this Agreement, provided that written notice of the breach has been given to the breaching party, and the breach has not been cured within thirty (30) days after delivery of such notice

13. TERMINATION BY MCI. MCI may discontinue service and/or terminate this Agreement immediately upon notice to Customer (a) if Customer fails, after MCI’s request, to provide a bond or security deposit, as set forth below; or (b) if Customer provides false information to MCI regarding the Customer’s identity, creditworthiness, or its planned use of the Services. MCI may discontinue service upon commercially reasonable prior notice if interruption of service is necessary to prevent or protect against fraud or otherwise protect MCI’s personnel from bodily harm, facilities from property damage or services; notwithstanding the foregoing, however, MCI may discontinue service immediately without notice, if MCI determines that MCI’s personnel facilities or services are in imminent risk of harm or damage

If Customer’s financial conditions change or other conditions so warrant including but not limited to becoming insolvent or bankrupt, MCI may request, and Customer shall furnish within ten (10) days of such request, a bond or other form of security deposit to assure payment. MCI will notify Customer in writing explaining the basis for such evaluation and surety request. Any alternative or additional security shall be an amount equal to, but not to exceed, three (3) months of estimated usage, and will be based on Customer’s actual usage and estimated future usage of services Customers payment history and financial solvency

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2

14. CONFIDENTIAL INFORMATION. Commencing on the date Customer executes this Agreement and continuing for a period of three (3) years from the termination of this Agreement, each party shall protect as confidential, and shall not disclose to any third party, any Confidential Information received from the disclosing party or otherwise discovered by the receiving party during the Term of this Agreement, including, but not limited to, the pricing and terms of this Agreement, and any information relating to the disclosing party’s technology, business affairs, and marketing or sales plans (collectively the “Confidential Information”), The parties shall use Confidential Information only for the purpose of this Agreement The foregoing restrictions on use and disclosure of Confidential Information do not apply to information that: (a) is in the possession of the receiving party at the time of its disclosure and is not otherwise subject to obligations of confidentiality; (b) is or becomes publicly known, through no wrongful act or omission of the receiving party; (c) is received without restriction from a third party free to disclose it without obligation to the disclosing party; (d) is developed independently by the receiving party without reference to the Confidential Information. or (e) is required to be disclosed by law regulation or court or governmental order

15. ACCEPTABLE USE. Use of the Service(s) and related equipment and facilities must comply with the then-current veneers of the MCI Acceptable Use Policy (paw) for the countries from 411C11 Customer uses them (see www.mic.com/terms). MCI reserves the right to suspend the affected Service or terminate this Agreement effective upon five (5) days written notice for a V010110/1 of the Policy in the event Customer violates the Policy or Customer uses the Service to transit* content that violates the Policy and Nth le cure such violation within the five (5) clays notice period, provided that Service may be suspended without prior notice (a) in response to a court or government demand or (b) if MCI determines the integrity or normal operation of the MCI Network is in imminent risk Customer will indemnity and hold harmless MCI from any losses, damages, costs or expenses resulting from any third-party claim or allegation. which if true, would constitute a violation of the Policy .Each party wet promptly notify the other of any such claim

16. DOMAIN NAMES. Customer will indemnify MCI for cost or liability arising from Customer’s use of any domain name registered or administered on Customer’s behalf that violates the service mark, trademark or other intellectual property rights of any third party Customer irrevocably waives any claims against MCI that may arise from the acts or omissions of domain name registries, registrars or other authorities Any violation of this Section is deemed a material breach establishing Cause for termination

17. DISCLAIMER OF WARRANTIES. EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT, MCI MAKES NO WARRANTIES, EXPRESS OR IMPLIED, AS TO ANY MCI SERVICES, RELATED PRODUCTS, EQUIPMENT, SOFTWARE OR DOCUMENTATION. MCI SPECIFICALLY DISCLAIMS ANY AND ALL. IMPLIED WARRANTIES, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR TITLE OR NONINFRINGEMENT OF THIRD PARTY RIGHTS

18. DISCLAIMER OF CERTAIN DAMAGES. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY INDIRECT, CONSEQUENTIAL, EXEMPLARY, SPECIAL, INCIDENTAL OR PUNITIVE DAMAGES, INCLUDING WITHOUT LIMITATION LOSS OF USE OR LOST BUSINESS. REVENUE, PROFITS, OR GOODWILL, ARISING IN CONNECTION WITH THIS AGREEMENT UNDER ANY THEORY OF TORT, CONTRACT, INDEMNITY, WARRANTY STRICT LIABILITY OR NEGLIGENCE, EVEN IF THE PARTY KNEW OR SHOULD HAVE KNOWN OF THE POSSIBILITY OF SUCH DAMAGES

19. LIMITATION OF LIABILITY. THE TOTAL LIABILITY OF MCI TO CUSTOMER IN CONNECTION WITH THIS AGREEMENT, FOR ANY AND ALL CAUSES OF ACTIONS AND CLAIMS, INCLUDING, WITHOUT LIMITATION, BREACH OF CONTRACT, BREACH OF WARRANTY, NEGLIGENCE, STRICT LIABILITY, MISREPRESENTATION AND OTHER TORTS, SHALL BE LIMITED TO THE LESSER OF: (A) DIRECT DAMAGES PROVEN BY CUSTOMER; OR (B) THE AMOUNT PAID BY CUSTOMER TO MCI UNDER THIS AGREEMENT FOR THE THREE (3) MONTH PERIOD PRIOR TO ACCRUAL OF THE MOST RECENT CAUSE OF ACTION. NOTHING IN THIS SECTION SHALL LIMIT MCI’S LIABILITY; (A) IN TORT FOR ITS WILLFUL OR INTENTIONAL MISCONDUCT; OR (B) FOR BODILY INJURY OR DEATH PROXIMATELY CAUSED BY MCI’S NEGLIGENCE; OR (C) LOSS OR DAMAGE TO REAL PROPERTY OR TANGIBLE PERSONAL PROPERTY PROXIMATELY CAUSED BY MCI’s NEGLIGENCE

20. ASSIGNMENT. Either party may assign this Agreement or any of its rights hereunder to an affiliate or successor without the prior written consent of the other party provided that if Customer assigns this Agreement to an affiliate or successor, then such affiliate or successor must meet MCI’s reasonable creditworthiness standards Any attempted transfer or assignment of this Agreement by either party not in accordance with the terms of this Section shall be null and void

21. SERVICE MARKS, TRADEMARKS AND PUBLICITY. Neither MCI nor Customer shall: (a) use any service mark or trademark of the other party; or (b) refer to the other party in connection with any advertising, promotion, press release or publication unless it obtains the other party’s prior written approval

22. GOVERNING LAW. This Agreement shall be governed by the laws of the State of New York without regard to its choice of law principles.

23. NOTICE. All notices (including Customer’s notice of disconnect), requests or other communications (excluding invoices) hereunder shall be in writing and either transmitted via overnight courier, electronic mail, hand delivery or certified or registered mail, postage prepaid and return receipt requested to the parties at the following addresses. Notices will be deemed to have been given when received. Customer shall provide thirty (30) days prior written notice for the disconnection of service Notwithstanding any such termination end except in cases where Customer has the right to terminate without additional liability, Customer will remain liable for any applicable early termination charges set forth in this Agreement. For a service disconnect notice to be effective, Customer must receive a confirmation from MCI’s Customer Service organization stating that the disconnect notice was received and accepted

To MCI Operation Center	With a copy to:
MCI	MCI
3300 East Renner Road	22001 Loudoun County Parkway
Richardson, TX 75061	Ashburn, VA 20147
Attn: Customer Service	Attn: Vice President and Chief Counsel
or via email to;	BusinessTransactions
notice@mci.com	Department of Law and Public Policy

24. ENTIRE AGREEMENT. This Agreement (and any Attachments and other documents incorporated herein by reference) constitutes the entire agreement between the parties with respect to the Services provided under this Agreement and supersedes all other representations, understandings or agreements that are not expressed herein, whether oral or written. Except as otherwise set forth herein, no amendment to this Agreement shall be valid unless signed by Customer and accepted by MCI

25. QUALITY ASSURANCE. Notwithstanding the provisions of the Section entitled “Early Termination Charges,” Customer will be permitted to terminate during the Term, without liability or further obligation, except for charges incurred up to the date of termination, a circuit that experiences “MCI-caused” quality deficiencies that are demonstrated by Customer to affect adversely and materially Customer’s telecommunications applications (such a termination under this clause shall constitute a “Termination for Quality Assurance”). As used in this Section, “MCI-caused” means MCI acts or omissions regarding the provision of a circuit to Customer. A Termination for Quality Assurance will not be effective unless Customer has reported troubles on a circuit-specific, ANI basis to (and received a corresponding trouble ticket number from) MCI’s Support Center and a period of not less than thirty (30) days

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

3

after receipt of Customers written notice of termination has elapsed during which time MCI fails to correct such MCI-caused quality deficiencies far such circuit Such thirty (30) day period will commence upon MCI’s receipt of Customer’s written notice and will not recommence if the same MCI-caused quality deficiencies occur again for such circuit during said thirty (30) day period

26. BUSINESS DIVESTITURE. In the event that Customer certifies to MCI in writing that: (a) Customer has sold or divested a subsidiary, affiliate or significant operating unit that uses Services hereunder (“Business, Divestiture”); (b) Customer is unable to satisfy the [ * ] solely as a result of such Business Divestiture: (a) Customer has not substituted services provided by other vendors in place of the Services; and (d) Customer is not able to substitute for such diminished MCI usage other telecommunications services not currently provided to Customers by MCI then Customer may request in writing that MCI and Customer attempt to negotiate a mutually agreeable amendment to this Agreement to [ * ] hereunder [ * ] of the [ * ] and provide [ * ] in the event that MCI and Customer fail to agree on such amendment within thirty (30) days of Customer’s written request, then this Agreement will remain in full force and effect and enforceable with its existing terms. This Section shall not apply during [ * ], and thereafter may only be used [ * ] during the Term. Following the establishment by MCI of a [ * ] as set forth herein, the [ * ] shall replace the [ * ] throughout this Agreement and Customer shall remain liable for charges pursuant to this Agreement, including, without limitation, Underutilization Charges and Early Termination Charges, based on the [ * ]. Notwithstanding anything herein to the contrary, in the event of the establishment of a [ * ] MCI may increase the rates provided and/or lower the discounts to Customer hereunder by sending at least thirty (30) days prior written notice thereof to Customer

27. BUSINESS DOWNTURN. In the event that Customer certifies to MCI in writing with supporting documentation, that (i) Customer is unable to meet the [ * ], notwithstanding Customer’s best efforts to do so and (ii) such failure results solely from a business downturn beyond Customer’s control which materially and permanently reduces the size or scope of Customer’s operations and the volume of Services required by Customer hereunder, then Customer may request in writing that MCI and Customer attempt to negotiate a mutually agreeable amendment to this Agreement to [ * ] hereunder [ * ] of the [ * ] and provide [ * ]. In the event that MCI and Customer fail to agree on such amendment within thirty (30) days of Customer’s written request, then this Agreement will remain in full force and effect and enforceable with its existing terms. This Section shall not apply during [ * ], and thereafter may only be used [ * ] during the Term. Following the establishment by MCI of a [ * ] as set forth herein, the [ * ] shall replace the [ * ] throughout this Agreement and Customer shall remain liable for charges pursuant to this Agreement including without limitation. Underutilization Charges and Early Termination Charges based on the [ * ]

28. CHRONIC SERVICE INTERRUPTIONS. If there are chronic service interruptions of a Service Element (as hereinafter defined), Customer may [ * ] A Service Element with chronic service interruptions is one on which (i) Customer has [ * ] on a [ * ] to (and received a corresponding [ * ]; and (ii) there have been [ * ] ([ * ]) or more service interruptions. A Service Element however, cannot be deemed to have chronic service interruptions if the service interruptions are caused by third parties, acts of God beyond control or MCI. local exchange carriers, systems or connections provided by third parties or by Customer; interruptions during any period where Customer has released a Service Element for scheduled maintenance, rearrangement or implementation; interruptions where Customer elects not to release a Service Element for testing and/or repair; interruptions of Customer’s equipment; amounts less than [ * ] dollar, interruptions of less than [ * ] minutes (except in the case of power failures); non-completion of calls due to network busy conditions; and interruptions due to Force Majeure Service Elements also include, for Premium Data Center Services, [ * ] Parties agree that interruptions in [ * ] of any duration will be considered an interruption for the purposes of this Section. Customer shall have the option to receive the following credits. If Customer experiences [ * ] ([ * ]) or more outages in any given [ * ] based on this [ * ] chart:

1^st [ * ]: [ * ]% of MRC of affected services

2^nd [ * ]: [ * ]% of MRC of affected services

3^rd [ * ]: [ * ]% of MRC of affected services

4^th [ * ]: [ * ]% of MRC of affected services Credits

Credits in any [ * ] are limited to [ * ]

If customer discontinues Premium Data Center Services under the terms and conditions of this section, Customer may discontinue any circuit(s) that terminates at said Data Center.

29. SIGNIFICANT SERVER INTERRUPTIONS. If Customer experiences [ * ] ([ * ]) outages in a [ * ] period resulting in a “Significant Server Interruption* (as hereinafter defined) of the Service, Customer may [ * ], Customers Transition Right shall apply in the event of any [ * ] under this Section. A “Significant Server Interruption” shall mean an Interruption of [ * ] percent ([ * ]%) of the [ * ] to Customer at the [ * ] on which Customer has [ * ] to (and received a corresponding [ * ]. A Significant Server Interruption, however cannot be deemed to have occurred if the server interruption is caused by third parties acts of God beyond control of MCI, local exchange carriers, systems or connections provided by third parties or by Customer; Customers release of a Service Element for scheduled maintenance, rearrangement or implementation (where the interruption only pertains to such Service Element); Customers unreasonable refusal to release a Service Element for testing and/or repair; Customer’s equipment (except in the case of power failures); non-completion of calls due to network busy conditions; and Force Majeure

30. EXECUTIVE ESCALATION. The parties will attempt in good faith to resolve any dispute arising out of or relating to this Agreement promptly by negotiation between executives who have authority to settle the controversy and who are at a higher level of management than the persons with direct responsibility for administration of this Agreement. Any party may give the other party written notice of any dispute not resolved in the normal course of business. Within fifteen (15) days after delivery of the notice, the receiving party will submit to the other a written response. The notice and the response will include (a) a statement of each party’s position and a summary of the arguments supporting that position and (b) the name and title of the executive who will represent that party and of any other person who will accompany the executive. Within thirty (30) days after delivery of the disputing party’s notice, the executives of both parties will meet at a mutually acceptable time and place, and thereafter as often as they will reasonably deem necessary to attempt to reach resolution. If the executives are unable to reach resolution within sixty (60) days after delivery of the disputing party’s notice, then the dispute will be determined by arbitration or litigation in accordance with the provisions of this agreement. All reasonable requests for information made by one party to the other will be honored

ADDITIONAL ATTACHMENTS; This Agreement incorporates the following Attachment(s):

Customer Profile Attachment

Services Attachment

Special Pricing Attachment

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

4

MCI Service Agreement

Customer Profile Attachment

Customer Profile

for Danger Inc.

MCI Commercial Customer Profile[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

5

MCI Service Agreement

Services Attachment

Services

for Danger Inc.

Data Services

Private Line (IXC) Service Agreement

I. GENERAL

The MCI private line (IXC) services provided pursuant to this Attachment (“Private Line Service”) are governed by the Guide provisions relating to Domestic Private Line for MCI Business Services I as supplemented by this Attachment and the related Agreement.

II. RATES AND CHARGES.

A. Customer will pay the following [ * ] charges, which are fixed for the term of this Agreement. for DSO, DS1, DS3, 0C3, 0C12 intrastate and interstate Private Line (IXC) circuits, based on the type of circuit and mileage band Private Line (IXC) Service [ * ] charges consist of two pricing components: (i) a [ * ] fixed charge based on Mileage Band (“Fixed Charge) and (i) a [ * ] per mile charge based on the mileage of the circuit (“Per Mile Charge”) One-time charges are set forth in the Guide provisions relating to Domestic Private Line for MCI Business Services I

[ * ] CHARGES [ * ]

C. DISCOUNTS Customer will receive the following discount percentage off the [ * ] charges listed above.

Service Type	Discount
Private Line - Domestic IXC	[	* ]%

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

6

MCI Service Agreement

Services Attachment (Continued)

Private Line (Metro) Service Attachment

I. GENERAL.

The MCI Metro Private Line Services provided pursuant to this Attachment (“Metro Private Line Service”) are governed by the Guide provisions relating to Metro Private Line for MCI Business Services I, as supplemented by this Attachment and the related Agreement

II. SERVICE DESCRIPTION.

Metro Private Line Service is a point-to-point and multi-point service which provides the Customer access to private telecommunications networks, wide area networks connections with information service providers and interexchange carriers who transport interstate traffic.

1. Transmission Speeds: Metro Private Line Service is available at varying transmission speeds as follows:

1.1. Digital Metro Private Line Service: Digital Metro Private Line Service is available as follows:

1.1.1. Voice Grade Service: Voice grade service provides frequency transmission capability in the nominal frequency range of 300 to 3000 Hz and may be terminated utilizing two-wire or four-wire circuits Voice grade service can carry both analog and digital data.

1.1.2. Digital Data Service: Digital data service provides the duplex four-wire transmission of synchronous serial data at rates ranging from 24 to 64 kbps (DSO)

1.1.3. High Capacity Service (DS-1): High capacity service provides transmission of synchronous serial data at speeds of 1,544 or 2,048 Mbps Transmission of Intermediate bit rate channels in multiple increments of either 56 or 84 kbps up to 1 544 Mbps is also available

1.1.4. Very High Capacity Service (DS-3): Very high capacity service provides transmission of synchronous serial data at speeds of 44 738 Mbps or faster

1.2. Metro Private Line SONET Service: Metro Private Line SONET Service, provides transmission of data at speeds of 155 Mbps or higher through an optical signal on the Synchronous Optical Network (SONET) OC3 (155 52 Mbps) and OC12 (822.08 Mbps) speeds are available in either concatenated or channelized configurations OC48 (2 488 Gbps) is available for Type 1 access in either concatenated or channelized form.

Each Metro Private Line SONET Service circuit connection requires a SONET Interface A SONET Interface is the connection of Metro Private Line SONET to a Customer Premises or hub. SONET Interfaces are available at the following speeds: (1) 1 544 Mbps (DS-1) and 44 736 Mbps (DS-3) on a digital signal basis; and (ii) 51.84 Mbps (STS-1), 155.52 Mbps (OC3 and 0C3c), 622 08 Mbps (OC12 and OC12c). and 2 488 Gbps (OC48 and OC48c) on an optical signal (SONET) basis Where technically feasible differing SONET Interfaces may be used on a circuit

Metro Private Line SONET Service in Type 2 and Type 3 network configurations is available only in locations where an RBOC Connecting Carrier provides the facilities not furnished via MCI or MCI-affiliated facilities

III. RATES AND CHARGES.

Metro Private Line Service [ * ] per-circuit charges and [ * ] charges and Metro Private Line Access Service [ * ] and non-recurring charges, which are fixed for the Term of this Agreement are set forth in the Guide provisions for MCl Business Services I for Metro Private Line Services

Other Services

Network Access Service Attachment

IV. GENERAL.

The MCI network access services provided pursuant to this Attachment (Access Service) are governed by the Guide provisions relating to Access for MCI Business Services I as supplemented by this Attachment and the related Agreement

V. RATES AND CHARGES.

A. Monthly recurring charges, which are fixed for the term of this Agreement and one-lime charges related to the Access Service are set forth in the Guide provisions relating to MCI Business Services I

B. DISCOUNTS Customer will receive the following discount percentage off the [ * ] charges listed in the Guide for the following types of Access.

Service Type	Discount of [ * ] Charge
[ * ]	[	* ]%
[ * ]	[	* ]%
[ * ]	[	* ]%

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

7

Data Center Services (US Only) Service Attachment

VI. GENERAL.

The Data Center Services (“Data Center Services”) provided pursuant to this Attachment are governed by the Guide provisions relating to Data Center Services as supplemented by this Attachment and Me Agreement

VII. RATES AND CHARGES.

A. Customer will pay the rates and charges for Data Center Services listed in the Pricing Schedule set forth below, based on the options selected. The [ * ] charges set forth in the Pricing Schedule are fixed for the term of this Agreement. [ * ] Charges will begin accruing on the Service Activation Date applicable to each Service, unless Customer has not provided MCI with all Information reasonably requested by MCI for the provisioning of Services. If Customer fails to provide MCI with such information, [ * ] Charges Will begin accruing on the thirtieth (30th) day following the date of Customer’s execution of the Agreement or Customer’s placement of an order in accordance with Section D below

B. Notwithstanding anything to the contrary in the Agreement and except as set forth in the Special Pricing Attachment, MCI does not waive and Customer will pay any standard installation and any other non-recurring charges for Data Center Services

C. DISCOUNTS. Customer will receive the discount percentage set forth in the Special Pricing Attachment off the [ * ] charges listed in the Pricing Schedule below except as otherwise specified. Any other Data Center Service rates and charges are subject to change pursuant to the Guide

VIII. TERMS AND CONDITIONS

A. SERVICE

1 MCI will provide to Customer the support, network connectivity physical access and/or additional services, including hardware (individually and collectively, the “Service”) in MCI’s Standard Data Centers and/or Premium Data Center, described below. Customer shall also purchase from MCI:

• In connection with Standard Data Center: A minimum of 1 [ * ] of data, voice or IP service associated with the Service per [ * ] ([ * ]) or fewer cabinets, plus [ * ] additional Mbps of data, voice or IP services from MCI for each additional Cabinet above three purchased by Customer hereunder

• In connection with Advanced Data Center: A minimum of [ * ] Mbps of data, voice or IP service associated with the Service per [ * ] ([ * ]) or fewer cabinets, plus [ * ] additional Mbps of data voice or IP services from MCI for each additional Cabinet above three purchased by Customer hereunder.

• in connection with Premium Data Center: A minimum of [ * ] Mbps of data voice or IP service associated with the Service per [ * ] ([ * ]) or fewer half or standard Cabinets, plus [ * ] additional Mbps of data, voice or IP services from MCI for each additional half or standard Cabinet above three purchased by Customer hereunder.

2 A Data Center Service includes the physical location or data center (“Facility”) in which equipment storage space (“Space”) will be made available to Customer for installation and use of Customer’s equipment (the “Equipment”)

3 Three types of Data Centers are available:

(i) Premium Data Centers provide the infrastructure services necessary to deploy a Customer’s Internet applications and includes

• Open racks, lockable Web-server cabinets. and cages

• AC power (2 x 20 Amp 110 Volt¹), and DC power on a case-by-case basis.

• Physical security, which includes electronic card reader access surveillance cameras, KeyTrac^®, biometric scanner, and 24x7 security guards

• Direct access to MCI’s IP Backbone via Data Center Internet Bandwidth.

• A Customer Work Area furnished with workstations and offering a quiet work environment separate from the Data Center floor.

• One domain name service (DNS) hosting.

• Premium Data Center Facility Services: MCI will perform certain services that support the overall operation of the Facility (e .g janitorial services, environmental systems and maintenance) at no additional charge to Customer

• A standard equipment cabinet or relay rack when specified that will support a total Equipment weight of 2,000 pounds. Customer will insure the Equipment weight does not exceed this amount

• Maintain an internal alarm system to monitor the operational status of the facility systems and report any failures or anomalies to Customer.

• A temperature of 72 degrees Fahrenheit plus or minus 8 degrees with 20 percent to 65 percent (non-condensing) humidity within the Facility. Equipment must be designed to operate within these ranges.

(ii) Advanced Data Centers provide Telco carrier-grade facilities, including

• Web-server cabinet cabinets Telco Cabinets, and Two-Post Racks

• 20-30 amp AC power supply or 30-60 amp DC power supply

• Lock-and-key secured entry into building, with limited surveillance camera capability

• Availability of Fast Ethernet connectivity to MCI’s IP Backbone (requires additional Service Attachment for Internet Dedicated Services).

• One domain name service (DNS) hosting available with Fast Ethernet connectivity

¹ In order to utilize the redundant power provided by MCI, Customer must have Equipment capable of plugging Into both the A power strip and the B power strip; Customer Is responsible for making the power connections. If Customer chooses the 50-amp Optional Power Upgrade, MCI will not supply the power strips. Customer can either supply its own power strips or it can plug directly into an electrical receptacle or order a combination of 20 amp AC and 30 amp AC receptacles (for which MCI will provide power strips).

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

8

(iii) Standard Data Centers provide Telco carrier-grade facilities, including -

• Open racks, standard cabinet space and lockable cabinets.

• 20-30 amp AC power supply or 30-60 amp DC power supply.

• Lock-and-key secured entry into building, with limited surveillance camera capability

4 Cross-Connect. Cables Cross-Connect cables connect the Customer’s Equipment with telecommunications services via a circuit from the patch panel Inside the Data Center to the Customer’s Cabinet inside the Data Center. The patch panel is the demarcation point (“d-marc”) where MCI or a third-party carrier terminates its circuit. Various types of cross-connect cables may be purchased from MCI

5 On-Site Technical Support (“Hands-and-Eyes Support”). Hands-and-Eyes Support consists of technical support for basic operational functions, and diagnostic and repair activity for certain equipment. The first two hours per month of On-Site Technical Support/Hands-and-Eyes Support are provided at no charge in Premium Data Centers. A comprehensive list of activities and procedures covered under “Hands-and-Eyes Support” is set forth at Virtual Console at the following URL: http://virtualconsole.mci.com. (The u-number and password required to access Virtual Console may be obtained from Customer’s account representative or, post-contract from an MCI implementation engineer.)

6 Alternate Carriers. Customer may arrange on its own (via separate contract) to bring in additional non-MCI circuits from a third-party carrier equal to or less than the bandwidth purchased from MCI subject to the terms of the Alternate Carrier Policy set forth in the Guide

• The alternate carrier must have an existing presence in the MCI Data Center (Standard, Advanced, or Premium), or Customer must use MCI to provision the circuit that connects to the alternate carrier’s network. If the carrier does not currently terminate in the specific MCI Data Center’s location, Customer must purchase either a Cross Connect if the alternative carrier is in the facility or a local loop to interconnect with the alternate carrier at the closest point of presence.

• MCI’s Data Centers are not carrier-neutral facilities. MCI offers Alternate Carrier access to its Data Center Services customers for redundancy purposes only. Thus, Customer must purchase at least an equal amount of Data Center-related connectivity from MCI. For example if Customer wishes to bring in a T-3 circuit from another provider it must purchase a T-3 or greater circuit from MCI.

• MCI does not take responsibility for alternate carrier circuits, nor does MCI make any promises or warranties whatsoever regarding their performance. MCI will use reasonable commercial efforts to accommodate Customer’s request to bring in equipment and circuits from other carriers already present in the Data Center

7 Backup and Restore Service

(I) Should Customer order MCI s Backup and Restore Service (“B&R Service”), the term for B&R Service shall run concurrent with the term for the attendant Data Center Service. In addition, for B&R Service, Customer shall (i) install any client-based software necessary to administer the B&R Service (for example, Customer is responsible for installing the Legato NetWorker client software on its servers (fees to Legato may be applicable); and (II) provide MCI with 7 days’ prior written notice of any changes to Customer’s configurations or existing computing environment parameters that interface with the Backup Service, including, but not limited to, any change of Customer’s server B&R system, the addition or removal of servers, the addition or removal of disks on Customer’s servers, and/or the addition or removal of Customer’s network configurations.

(II) MCI will charge an additional recall charge (“Recall Charge”) per recall incident for recalling tapes located at an off-site storage facility (“Recall incident”). A Recall incident shall include a maximum of 15 tapes per request A successful restore may be for any data type and requires that adequate space is available on Customer’s servers to which data is being restored. Customer may request that MCI provide a copy of the tapes used for Backup Services supplied to Customer; provided (I) Customer notifies MCI in writing of the data set desired; and (II) Customer pays the applicable charges for any such tapes (“Eject Charge”).

(III) If Customer desires to obtain non-standard Backup & Restore services that MCI makes available but are not part of the standard Backup & Restore Service Description, additional charges associated with MCI’s performance of such services may apply. These non-standard 8&R services will be charged at an hourly rate that will be applied against Customer’s Hands-and-Eyes Support (see above). For example, if, during a month, Customer orders three hours of non-standard B&R services in support of its Premium Data Center Service – and no other Hands-and-Eyes Service, Customer shall be billed for only one hour of Hands-and-Eyes Support as the first two hours are included in the provision of Premium Data Center Service. A sample list of such non-standard B&R services is set forth at MCI’s Virtual Console.

(iv) Backup and Restore Service is provided to Customer via a dedicated MultiMode fiber optic connection. Customer is responsible for providing a MultiMode Fiber GigE port with SC connector on its side to accept such a connection. The Backup Retention Policy is set forth in the Guide

(v) The SLA for B&R Services is set forth at MCI’s Corporate website at: http://global mci com/terms for collocation services.

8 Load Balancing Service. Load Balancing Service is available with Premium Data Centers (see Premium Data Center Price Schedule). The SLA for Load Balancing Service is set forth in the colocation section at: http://global.mci.com/terms (or other url as designated by MCI).

9 MCI agrees to deliver HVAC to the Premium Data Center space in accordance with the service description provided previously in this Agreement (Section III.A.3 ) for the configuration outlined in the exhibits in Section L. Parties may mutually agree to place additional servers into this or other spaces with associated costs, if applicable, but MCI is not hereby obligated to do so prior to such agreement.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

9

10 The parties agree to mutually determine upon measurement devices that may be installed within designated cage spaces, and precisely where, within ninety (90) days following countersignatures to this Agreement. The parties will work together to determine which party will monitor such devices and how often they will be measured. Such devices will be used to measure the temperature in the Customer cage areas. The parties agree to work in good faith to establish a commercially reasonable period of remedy in the event that temperature is out of the specified range per Section III A

11 Quarterly Review. MCI and Customer agree to meet no less than on a quarterly basis to review Service Levels, custom build-out progress for the 80 amp/rack requirement within Customer’s space, and other items relating to Data Center activities that affect MCI and Customer under this Agreement.

B. CUSTOMER CONTENT

1 Customer, not MCI, has sole and exclusive control over the content residing on the Equipment (the “Customer Content”). The parties acknowledge and agree that in the provision of Service hereunder MCI is not provided, either directly or indirectly, and will not seek access to, the Customer Content. MCI does not and will not exercise any control over the Customer Content

2 Customer will use reasonable efforts to promptly and thoroughly respond to any notices that the Customer Content violates the Digital Millennium Copyright Act, 17 U.S.C 101 et. seq (the “DMCA”) or any other law, rule or regulation

C. TERM AND TERMINATION. The term of any Service ordered hereunder will commence on the date MCI is prepared to provide the Space to Customer for Installation of Equipment (the “Service Activation Date”), and automatically renew expire and terminate according to the terms of the Agreement. Notwithstanding the above, Data Center IP bandwidth purchased from MCI shall be coterminous with the underlying Premium Data Center Service. In order to terminate a Data Center Service, in addition to the Notice requirements set forth in the Agreement, Customer must deliver an email message stating its desire to terminate the applicable Service to the following email address: hosting-cancel@mci.com (“Termination Notice Email Address”) Such termination shall be effective 60 days following MCI’s receipt of such notice

D. ORDER PROCESS. Customer may order Services by contacting Customer’s MCI-designated account representative who will process Customer’s order. This order shall constitute the binding commitment of Customer to purchase the requested Service. MCI’s activation of Service shall constitute MCI’s acceptance of Customer’s order, unless another mode of acceptance is expressly stated MCI reserves the right to reject any order for any reason, including without limitation, MCI’s obligations under applicable laws, regulations, directives, governmental authority or orders, third party contracts, or Customer’s failure to meet MCI’s credit approval requirements. In addition, MCI may reject an order in the event (a) of the inability or impracticality of providing such Service in a particular geographic area in which MCI does not have sufficient presence, capacity. corporate infrastructure or Network technical infrastructure to effectively support the requested Service or (b) MCI no longer commercially offers the Service

E. PERMISSIBLE USE OF SPACE

1 Customer will use the Space only for the purposes of installing, maintaining, and operating the Equipment. Access to the Facility is restricted to Customer’s employees and agents. Customer will furnish to MCI, and keep current, a written list identifying a maximum of 15 individuals authorized to obtain entry to the Facility and access the Space. Customer will exercise reasonable efforts to ensure that no individual it authorizes to enter the Facility will have been convicted of a felony. Customer assumes responsibility for all acts and omissions of the individuals included on this list or authorized by Customer to enter the Facility. Customer’s employees and agents will comply with all applicable laws, rules, regulations, and ordinances; and with all MCI or Facility security procedures, rules, requirements, and safety practices (which include, but are not limited to, a prohibition against smoking in the Facility), as amended from time to time MCI reserves the right to revoke the entry privileges of any person at any time and for any reason.

2 MCI and its designees may observe the activities of Customer’s employees and agents in the Facility and may inspect at any time the Equipment brought into or removed from the Facility. including the Space Customer’s employees and agents will not use any products, tools, materials, or methods that, in MCI’s reasonable judgment, might harm, endanger, or interfere with the MCI Network, the Service. MCI’s provision of services to any other customer, the Facility, or the personnel or property of MCI, its vendors or its other customers MCI may take any reasonable action to prevent such potential harm or interference and shall promptly notify Customer in the event it takes any such action

3 Customer will not provide or make available to, or sublicense to or permit in any manner any third party to use all or a portion of the Space or the Facility, excluding Customer’s employees and agents. MCI may immediately terminate Data Center Services provided under this Attachment upon notice to Customer. If (a) Customer makes the Space available to any other person or entity, excluding Customer’s employees and agents; or (b) if the Service is resold or used by another organization. Notwithstanding the foregoing Customer may bring third parties into the Space and Facility to perform technical functions and to tour the Space and Facility; provided Customer notifies MCI in advance Customer remains fully responsible for the actions of such third parties, and such third parties comply with MCI’s policies and procedures and provided such third parties are accompanied by Customer and/or MCI at all times. MCI will permit Customers capital lease financiers to inspect the Equipment in the facility pursuant to the preceding sentence and as reasonably requested by such financiers MCI will confirm the right to inspect the Equipment in writing

4 Customer will maintain the Space in an orderly manner and will be responsible for the prompt removal of all trash, packing material cartons, and other items or materials that Customer’s employees or agents bring into or deliver to the Facility. No material improvements or modifications will be made to the Space or any portion of the Space or the Facility unless approved by MCI, which approval will not be unreasonably delayed, conditioned or withheld. MCI will provide 5 days’ advance written notice to Customer of its demand to remove any unapproved items from the Space, including materials that could be considered a fire hazard, and of its intent to disconnect or remove unauthorized items and/or equipment from the Space. Notwithstanding the foregoing, if MCI determines in its reasonable discretion that such unapproved items possess an immediate risk to the Facility or MCI’s other customers, MCI may immediately disconnect or remove such unauthorized equipment from the Space without prior notice to Customer and without liability to MCI

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

10

5 Upon the expiration or termination of this Service attachment or any Data Center Service provided hereunder (subject to Customers Transition Rights), Customer will surrender the applicable Space to MCI and, within 30 days after the date of such expiration or termination return the Space to MCI in the same condition as it was originally delivered to Customer, reasonable wear and tear excepted. Customer will remove the Equipment from the Space and the Facility and will fully repair any damage to the Facility caused by Customer, including, without limitation, any damage resulting from Customer’s removal of the Equipment from the Space. Any Equipment and/or personal property of Customer not removed within 30 days after the date of such expiration or termination will at MCI’s option, conclusively be deemed to have been abandoned by Customer MCI may, upon written notice to Customer, apportion, sell, use, store, destroy, or otherwise dispose of the Equipment or Customer’s personal property without liability to Customer or any other person or entity. Customer will pay all expenses and costs incurred in connection with MCI’s disposition of the Equipment and Customers personal property, including without limitation, the cost of restoring the Facility to its original condition and of removing the Equipment or Customer’s personal property from the Facility

F. CONDUCT IN FACILITY

1 Customer will maintain and operate the Equipment in a safe manner, and keep the Space and any portion of the Facility it accesses in good order and condition. Customer agrees to use the common areas of the Facility only for the purposes for which they are intended. Customer’s employees and agents are prohibited from bringing any harmful or dangerous materials (as determined by MCI in its sole discretion) into the Facility. Such materials include, but are not limited to wet cell batteries, explosives, flammable liquids or gases alcohol, controlled substances weapons, cameras and video or voice recording devices. Customer agrees that its employees and agents will not harm or attempt to breach the security of the Facility the Service, or any third party system or network connected to the Facility or accessed by means of the Service.

2 Customer agrees not to alter, tamper with, adjust, or repair any equipment or property not belonging to Customer. Customer further agrees not to erect signs or devices on the exterior of the storage cabinet or to make any physical changes or material alterations to the Space or any portion of the Facility.

3 If Customer desires any assistance in the MCI Facility, Customer shall provide commercially reasonable notification to MCI prior to arriving at any MCI Facility by calling MCI a customer service center at the number listed on Customer’s invoice or other contact number as may be designated by MCI

4 Permanent use of extension cords in the Data Center is prohibited.

G. EQUIPMENT

1 All Equipment situated in the Facility is hereby charged with a lien, charge mortgage or encumbrance in favor of MCI to the extent of any unpaid fees plus interest thereon under the Agreement or any other agreement between MCI and Customer and this Attachment will constitute a security agreement with respect to such Equipment

2 Customer will be allowed to remove from the Facility only that Equipment in which Customer can evidence it has sufficient ownership or possessory interest

3 All Equipment must fit within the Space. Unless otherwise provided in a Service Order, Customer agrees that power consumption will not exceed the power rating identified on the applicable Service Order and that all Equipment is UL approved Cabling used by Customer must meet national electrical and fire standards and any specifications provided by MCI

4 MCI reserves the right to relocate the Equipment within the Facility or to move the Equipment to another facility with at least 90 days’ written notice; provided that any Equipment relocation or move resulting from a force majeure event will be governed by the section on Force Majeure set forth below Equipment moved or relocated at MCI’s initiative will be at MCI’s expense. MCI will use commercially reasonable efforts to minimize downtime and service interruption in the event Equipment is moved or relocated. MCI will not require Customer to move to a new facility or relocate Customer’s equipment within the facility prior to 12/01/2007, or in the event that MCI renews its lease on the property, at any time during the term of this Agreement

5 Customer will immediately remove or render non-infringing, at Customer’s expense any Equipment alleged to infringe any patent, trademark, copyright, or other intellectual property right.

6 Customer will promptly notify MCI of any lien(s) on or security interest(s) in the Equipment

7 If MCI damages any Equipment, MCI will repair or replace the damaged item or, at MCl option, reimburse Customer for the reasonable cost of repair or replacement. If such damage results in a service outage the applicable SLA remedy shall apply

H. THIRD-PARTY SOFTWARE. Customer is fully responsible for any third-party software it uses in the Space. Customer shall indemnify, defend, and hold MCI harmless from any action against MCI to the extent that it is based on an allegation that such third-party software has infringed an intellectual property right or trade secret and pay those damages or costs related to the settlement of such action or finally awarded against MCI in such action, including but not limited to attorneys’ fees, provided that MCI (i) promptly notifies Customer of any such action (ii) gives Customer full authority information and assistance to defend such claim at Customer’s expense

I. INSURANCE

1 Throughout the Term. Customer will maintain and will require any of its subcontractors to maintain, the following insurance coverages:

(i) Commercial General Liability Insurance covering liability for injury to or death of persons and damage to property at a minimum of [ * ] dollars ($[ * ]) per occurrence and [ * ] dollars ($[ * ]) aggregate. The policy will cover (a) any contractual liability assumed under this Agreement (b) liability which may arise from the use of independent contractors (c) explosion liability and damages to underground utilities and damage caused by collapse, if the appropriate exposure exists (involving blasting, underpinning, and structural alterations, etc.) (d) broad form property damage; (e) personal injury liability and (f) an amendment to pollution exclusion to include damage from heat smoke and fumes from hostile fire.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

11

(ii) Automobile Liability covering bodily injury and property damage with combined single limit of [ * ] ($[ * ])

(iii) Umbrella and/or Excess Liability Insurance of no less than [ * ] dollars ($[ * ]) over and in addition to the coverage applying to (I) and (II), above.

(iv) Workers Compensation Insurance not less than statutory limits and Employers Liability Insurance at a minimum of [ * ] dollars ($[ * ]) per occupational injury or illness

(v) All-Risk Property Insurance in an amount not less than replacement cost of Customer’s property

2 All insurance policies will be issued by carriers with A M. Best solvency ratings of at least A-VIII. MCI will be named as an additional insured with respect to all coverages except (1v) and (v) above. Customer’s insurance will be primary and non-contributory to any other policies with respect to their operations. The Commercial General liability insurance wilt contain the Amendment of the Pollution Exclusion’ endorsement for damage caused by heat smoke or fumes from a hostile fire

3 MCI will not insure or be responsible for any loss or damage to property of any kind owned or leased by Customer or by its employees and agents other than losses or damages proximately resulting from MCI’s negligence or willful misconduct. My insurance policy covering the Equipment against loss or physical damage will provide that underwriters have given their permission to waive their rights of subrogation against MCI. the Facility’s landlord, and their respective directors, officers and employees (the “Providers”), except for such loss or physical damage proximately caused by the sole negligence or willful misconduct of the Providers in the event the Facility’s landlord requires additional insurance pursuant to a lease relevant to a particular Space or the landlord legally imposes additional other requirements under the lease, Customer hereby agrees to comply with the landlord’s reasonable requirements under the lease as the lease may be modified from time to time; provided Customer is given sufficient notice.

4 Certificate(s) evidencing the insurance coverages and other requirements in this will be submitted to MCI upon execution of the Agreement The certificate(s) will certify that no termination of such coverage will be effective without at least 30 days advance written notice to MCI at: MCI WORLDCOM Communications, Inc Attn: Data Center Services Product Management 22001 Loudoun County Parkway Ashburn, VA 20147 Fax (703) 888-0685

J. NO ESTATE OR PROPERTY INTEREST MCI hereby grants to Customer an exclusive, limited license to use and occupy the Space in the Facility where Data Center Services have been ordered for the sole purpose of installing, operating and maintaining the Equipment in accordance herewith Customer acknowledges that it has not been granted any real property interests in the Space or the Facility. Payments by Customer pursuant to this Attachment do not create or vest in Customer (or in any other entity or person) any leasehold estate, easement, ownership interest, or other property right or interest of any nature in the Facility or any part thereof. The parties intend and agree that the Equipment, whether or not physically affixed to the Facility, are not fixtures and will not be construed as such Customer (or the lessor of the Equipment, if applicable) will report the Equipment as its personal property wherever required by applicable laws and will pay all taxes levied upon such Equipment. This Attachment is expressly made subject and subordinate to the terms and conditions of any underlying ground or facilities lease or other superior right by which MCI or MCI’s affiliates have acquired its interest in the Facility. Customer agrees to comply with any terms and conditions of such superior right. If the consent of the holder of such superior right is required for the parties to enter into this Attachment, then this Attachment will not become effective until such consent is obtained. The parties hereto are not required to obtain the consent of the ground or facilities lessor to enter into this Agreement. The lease for the center runs through December 1, 2007 with an option to extend the lease until August 1, 2013. MCI will not move Customer out of the San Jose Space prior to December 1, 2007. If this Attachment is subsequently construed by the landlord or the sub-landlord of the Facility (if applicable) to be a violation of the lease or sublease under which MCI occupies the Facility. Customer will either enter into an agreement approved by such landlord or sub-landlord, or remove the Equipment from MCI Location in accordance with the terms of this Attachment (but in such event, Customer’s Transition Rights shall apply) MCI agrees to cooperate with Customer in obtaining the approvals Customer may need to obtain from the landlord or sub-landlord.

K. FORCE MAJEURE

1 Any delay in or failure of performance by either party under this Attachment (other than a failure to comply with payment obligations) will not be considered a breach of this Attachment if and to the extent caused by events beyond the reasonable control of the party affected, including, but not limited to acts of God, embargoes, governmental restrictions strikes (other than those only affecting Customer), riots, insurrection, wars, or other military action, acts of terrorism, civil disorders, rebellion, fires, floods, vandalism, or sabotage. Market conditions and/or fluctuations (including a downturn of Customer’s business) will not be deemed force majeure events. The party whose performance is affected by such events will promptly notify the other party, giving details of the force majeure circumstances, and the obligations of the party giving such notice will be suspended to the extent caused by the force majeure so long as the force majeure continues. The time for performance of the affected obligation hereunder will be extended by the time of the delay caused by the force majeure event

2 If the Space is damaged due to a force majeure event, MCI will give prompt notice to Customer of such damage, and may temporarily relocate the Equipment to new Space or a new Facility if practicable if the Facility’s landlord or MCI exercises an option to terminate a particular lease due to damage or destruction of the Space, or if MCI decides not to rebuild the Space the applicable Data Center Service will terminate as of the date of the force majeure event in the event of such termination, or a temporary cessation of Data Center Service caused by a force majeure event, Monthly Fees for Space and Service will proportionately abate for the period from the date of the force majeure event and, in the case of temporary cessation, recommence upon the re-commencement of Data Center Services. If neither the landlord of the Facility nor MCI exercises the right to terminate, MCI will repair the particular Space to substantially the same condition it was in prior to the damage, completing the same with reasonable speed. In the event that MCI falls to complete the repair within a reasonable lime period, Customer will have the option to terminate the applicable Data Center Service with respect to the affected Space which option will be the sole remedy available to Customer against MCI under this Agreement relating to such failure. If the Space or any portion thereof is rendered untenable by reason of such damage and the Equipment is not relocated to a new Space or a new Facility, the Monthly Fee for Space and Service will proportionately abate for the period from the date of such damage to the date when such damage is repaired

L. FACILITY FLOOR PLANS. The facility schematics are attached hereto and are marked Exhibit 1 and Exhibit 2 respectively. Parties agree and understand that Customer shall occupy the spaces as indicated in Exhibits 1 and 2. and that MCI shall deliver power and HVAC sufficient to support up to 2000U of servers in this combined space, with up to 80 Amps of usable power per 40U rack Customer understands and agrees that there is an additional cost for additional power as outlined in the pricing schedule

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

12

SERVICE LEVEL AGREEMENT (SLA)

U.S. DATA CENTER SERVICES FOR PREMIUM DATA CENTERS

1. Installation

Installation of MCI Data Center Internet Bandwidth, standard cabinet and standard power options is to be completed within seven business days for any Customer requesting 100 Mbps or less of Data Center Internet Bandwidth connectivity or 20 business days for any Customer requesting over 100 Mbps up to 1.000 Mbps of connectivity

The installation SLA for customers purchasing standard cabinet and power options but not purchasing Internet Bandwidth is seven business days

Installation SLA Process

The Installation SLA period shall commence upon the date that the Hosting Install Engineer emails a notice to Customer that the install period has started. The Installation SLA is not available for non-MCI customer-ordered circuits, other MCI connectivity, non-standard or custom cabinet/cage space, non-standard power, or if installation delay is attributable to Customer equipment, acts or omissions of Customer its employees or agents Customer not passing MCI’s credit check or reasons of Force Majeure (as defined in the applicable Service Agreement)

Installation SLA Remedy

Upon receiving emailed notification from MCI’s Hosting Install Engineer that the Facility is ready for Customer’s Equipment Customer shall have ten (10) days within which to contact MCI’s installation engineer if Customer believes MCI has failed to meet the installation SLA. If Customer contacts MCI within such ten (10) day period and if MCI determines in its reasonable commercial judgment that MCI has failed to meet the installation SLA Customer’s account shall be credited 50% of MCI’s standard Installation Fee for the Service with respect to which this SLA has not been met

2. AC Power Availability

AC power is to be available to Customer’s Data Center Services cages/racks 100% of the time

Power Availability SLA Process

“Power Unavailability” consists of the number of minutes that AC power was not available to Customer’s Data Center Services cabinet. Outages will be counted as Power Unavailability only if Customer opens a trouble ticket with MCI Customer support within live days of the outage Power unavailability will not include unavailability resulting from (a) any Customer circuits or equipment, (b) Customer’s applications or equipment, (c) acts or omissions of Customer, or any use or user of the service authorized by Customer or (d) reasons of Force Majeure (as defined in the applicable Service Agreement)

Power Availability SLA Remedy

For each cumulative hour of Power Unavailability or fraction thereof in any calendar month, at Customers request Customer’s account shall be credited the charges for one day of the MCI Monthly Charge for the service with respect to which a Power Availability Agreement has not been met Customer shall receive the larger of the credits received in this paragraph or in the “Chronic Service Interruptions” Section but not both Network Latency (applicable only to MCI-provided Internet bandwidth in MCI Premium Data Centers)

MCI’s U S Latency SLA is an average round-trip transmission of 65 milliseconds or less between MCI-designated inter-regional transit backbone routers (“Hub Routers”) in the contiguous U.S. MCI’s Transatlantic Latency SLA is an average round-trip transmission of 95 milliseconds or less between an MCI Hub Router in the New York metropolitan area and an MCI Hub Router in the London metropolitan area Latency is measured by averaging sample measurements taken during a calendar month between Hub Routers Network performance statistics relating to the US Latency SLA and the Transatlantic Latency SLA are posted at the following location: http://global mci com/about/network/latency/

Network Latency SLA Remedy

If MCI fails to meet any Network Latency SLA in a calendar month, Customer’s account shall be automatically credited for that month. The credit will consist of pro-rated charges for one day of the MCI Monthly Fee for the Service with respect to which this SLA has not been met. Credits will not be issued if failure to meet either the U S Latency SLA or the Transatlantic Latency SLA is attributable to reasons of Force Majeure (as defined in the applicable Service Agreement)

4. Network Packet Delivery (applicable only to MCI-provided Internet bandwidth in MCI Premium Data Centers)

MCI offers both a North America and Transatlantic Network Packet Delivery SLA MCI’s North American Network Packet Delivery SLA is packet delivery of 99.5% or greater between UUNET-designated Hub Routers in North America. The Transatlantic Network Packet Delivery SLA is packet delivery of 99.5% or greater between a UUNET-designated Hub Router in the New York metropolitan area and a UUNET-designated Hub Router in the London metropolitan area

Packet delivery is measured by averaging sample measurements taken during a calendar month between Hub Routers. Network Performance statistics relating to the Network Packet Delivery SLAs shall be posted at the following location: http://www mci com/about/network/latency/

Network Packet Delivery SLA

If MCI fails to meet any Network Packet Delivery SLA in a calendar month, Customer’s account shall be automatically credited for that month. The credit will include the pro-rated charges for one day of the MCI Monthly Fee for the Service with respect to which a Network Packet Delivery SLA has not been met. No credits will be issued if failure to meet a Network Packet Delivery SLA is attributable to reasons of Force Majeure (as defined in the applicable Service Agreement)

5. Network Service Availability (applicable only to MCI-provided Internet bandwidth in MCI Premium Data Centers)

MCI’s Network Service Availability SLA provides that the MCI Network (as defined in the applicable Service Agreement) will be available 100% of the time. If this SLA is not met during any given calendar month, Customer’s account will be credited. At Customer’s request. MCI will calculate the “Network Unavailability” in a calendar month. “Network Unavailability” consists of the number of minutes that the MCI Network was not available to Customer Network Unavailability does not include (a) an incident of unavailability continuing for one hour or less, (b) network unavailability which Customer fails to report to MCI within 30 days from the date the SLA was not met, or (c) any unavailability resulting from: (i) MCI Network maintenance; (ii) Customer’s applications equipment, or facilities; (iii) acts or omissions of Customer or user of the service authorized by Customer; or (iv) reasons of Force Majeure (as defined in the applicable Service Agreement)

Network Service Availability SLA Remedy

If MCI fails to meet this Network Availability SLA Customer’s account shall be credited one day of the MCl Monthly Fee for each cumulative hour of Network Unavailability or fraction thereof in any calendar month

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

13

6. Outage Reporting (applicable only to MCI-provided Internet bandwidth in MCI Premium Data Centers)

Under MCI’s Outage Reporting SLR, Customer is to be notified within 15 minutes after MCI’s determination that Customers service is unavailable. MCI’s standard procedure is to ping Customer’s colocated equipment every five minutes. If Customer’s equipment does not respond after two consecutive five-minute ping cycles. MCI will deem the service unavailable and will contact Customer’s designated point of contact by a method elected by MCI (telephone, email. fax or pager). MCI will use commercially reasonable efforts to provide Customer with the Reason for Outage (RFO) within five (5) days following the conclusion of the outage

7. Backup and Restore

MCI’s records and data shall be the basis for all Backup and Restore SLA calculations and determinations. The maximum amount of credit in any calendar month for ell Backup and Restore SLAs, in the aggregate, shall not exceed 50% of the total charges that would have been charged by MCI that month for the Backup and Restore Service (collectively the “MCI Fees”)

Definition of Successful Backup:

To be considered a successful backup, each backup must be successfully completed by the end of its scheduled Backup Window Standard backup windows are eight hours on weekdays and 22 hours on weekends. For customers using Network Backup and Restore service there is currently no SLA to complete backups within the backup window.

The following Tables set forth the service credits available under the Backup and Restore SLA. The percentage of Monthly Successful Completed Backups is determined based on the total number of successfully completed backup jobs divided by the total scheduled backup Jobs during a month Service credits do not accumulate one month to the next

Table 1—Backup & Restore Service (backup process only)

Monthly Successfully Completed Backups	Service Credit Percentage (maximum)
95%	[	* ]%
<95% but 90%	[	* ]%
< 90% but >= 80%	[	* ]%
< 80% but >= 70%	[	* ]%
< 70%	[	* ]%

Definition of Successful Restore:

A Restore of data—flies, file systems and/or databases, as applicable – will be considered successful once the data to be recovered has been transferred from the tape to Customer’s primary storage space in the same condition in which it was backed up. If the retention period specified by Customer is one year or less, and if acclimatization is not required, Restores will commence within 30 minutes of initiation for data stored within the tape library, and within 3 hours of initiation for data stored outside the tape library. If acclimatization is required, Restores will commence within 30 minutes of completion of acclimatization. If the tape storage period is longer than one year no time period for commencement applies. If as a result of MCI’s actions or inactions, any Restore is not successful the Restore shall by deemed an “Unsuccessful Restore” and will be subject to the service credits noted in the table below

Table 2—Backup & Restore Service: Restore Success Service Credits (restoration process only)

Monthly Unsuccessful Restores	Service Credit Percentage (maximum)
1	[	* ]%
2	[	* ]%
3 "	[	* ]%
4	[	* ]%
5 and above	[	* ]%

The Service Credits referenced above in Tables 1 and 2 are not cumulative MCI shall apply Monthly Service Credits based upon the greater of (i) the Backup Storage Service Credits or (ii) the Restore Success Service Credits

Specific Exceptions,

The paragraph below summarizes the standard policy for handling the following specific exceptions and events:

• Backup Exceeds Window (due to unreasonably excessive capacity growth or Backup Client Server processing constraints) Default Action: MCI will reschedule Job start time within the policy window or spilt the job into multiple parallel streams, to rectify problem Alternative: if above is not successful MCI will contact End User through MCI to arrange for an acceptable policy exception for the Backup Client involved

• File Open/Not backed up

No action

File will be picked up on the next scheduled backup. Files which are never closed will never be backed up without the purchase of additional service.

• Backup Client not accessible

Notify MCI.

Backup will automatically pick up with next day’s schedule except that if a-Full Backup is missed a Full Backup will be completed the next day subject to End User limitations.

• Unable to restore from tape

Attempt Alternate Restore: Contact Customer through MCI.

MCI will attempt to restore the file from a different/previous backup Job End User will be notified of the failure and will verify which alternate file should be used if any Nolte will be provided within the restore initiation window defined for the particular file

• Backup carried out over non-dedicated network

MCI will make reasonable attempts to complete the backups within the scheduled Backup Windows

Additional Specific Exceptions:

• Backup/Restore Speed: The speed at which a backup or restore process executes is usually defined by the processing capabilities, data layout, and other concurrent processes on Backup Client systems MCI provides no SLA for backup/restore rates due to the variability of Customer’s systems and networks.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

14

• File System Size:

Local Backup: No SLA is applicable to successful Local Backups within the 8-hour weekday window for file systems larger than 100 gigabytes No SLA is applicable to successful full backups within the 22-hour weekend window for file systems larger than 250 gigabytes

Network Backup: For customers using Network Backup and Restore service there is currently no SLA for time to complete backups of any file system size.

• Tape Media Errors: Today’s tape drives include a high degree of error correction capability (typically one uncorrected error in 1 017 byes) Nonetheless there is still a small statistical probability that an uncorrectable media error will occur

• Full File System/Database Status: File systems and databases occasionally have internal errors that cause some files or tables to be unreadable A restore can never exceed the integrity of the backup from which it is created. An appropriate file/database maintenance schedule by Customer on Customer’s Backup Client servers will minimize any logical problems in the data being backed up.

The SLAs for all Data Storage Services will not apply to scheduled maintenance or any unavailability resulting from (a) any Customer circuits or equipment (b) Customer’s applications or equipment, (c) acts of omissions of Customer, or any use or user of the service authorized by Customer or (d) reasons of Force Majeure (as defined in the applicable Service Agreement)

B. Load Balancing Service Availability

MCI’s Load Balancing Service Availability SLA provides that the MCI Load Balancing Service (as defined in the applicable Service Attachment) will be available 100% of the time At Customer’s request. MCI will calculate the “Load BaLancing Unavailability” in a calendar month, “Load Balancing Unavailability” consists of the number of minutes that the MCI Load Balancing Service was not available to Customer. Load Balancing Unavailability does not include (a) Load Balancing unavailability which Customer fails to report to MCI within 30 days from the date the SLA was not met, or (b) any unavailability resulting from: (i) MCI Load Balancing maintenance as defined under “Scheduled Maintenance” (see below); (ii) Customer’s applications, equipment, or facilities; (iii) acts or omissions of Customer or any use or user of the service authorized by Customer; or, (iv) reasons of Force Majeure (as defined in the applicable Service Agreement or Service Attachment)

Load Balancing Service Availability SLA Remedy

If the Load Balancing Service Availability SLA is not met during any given calendar month in accordance with the above, Customer’s account will be credited one day of the MCI monthly fee for the affected Data Center Service for each cumulative hour of Load Balancing Unavailability or fraction thereof in any calendar month, the total credit not to exceed the MCI monthly fee for the affected Data Center Service for the effected month in no event shall Customer receive credits for noncompliance with this SLA (i) combined with noncompliance of other applicable SLAs greater than the amount of the MCI monthly fee for the affected Data Center Service or (le for any period of unavailability for which Customer is already receiving a credit under the Network Service Availability SLA

9. Denial of Service Response Time

MCI will respond to Denial of Service attacks reported by Customer within 15 minutes of Customer opening a complete trouble ticket with MCI Customer Support

To open a trouble ticket for Denial of Service, Customer must call MCI at 1-800-900-0241 (Option 4) and state: “I think I am under a Denial of Service Attack” A complete trouble ticket consists of Customer’s Name, Account Number, Caller Name, Caller Phone Number, Caller Email Address and Possible Destination IP address / Type of Attack

Denial of Service Response Time – Remedy

If MCI fails to meet the Denial of Service Response SLA, Customer’s account will be credited at Customers request, the pro-rated charges for one day of the MCI Monthly Fee for the affected Service Customer may obtain no more than [ * ] per day regardless of the number of Denial of Service SLA non-compliances during the day

Denial of Service Response Time – General Conditions

• A Denial of Service attack is defined as more than 95% bandwidth utilization

• MCI shall use trouble tickets and other appropriate MCI records to determine, in its sole judgment SLA compliance

• Customer must notify MCI no later than 30 days after the Denial of Service attack(s) occurred

• MCI reserves the right to enhance the SLA

10. Scheduled Maintenance

Scheduled Maintenance shall mean any maintenance at the MCI data center at which Customer’s server is located (a) of which Customer is notified 72 hours in advance and (b) that is performed during a standard maintenance window on Tuesdays and Thursdays from 3 AM to 6 AM local time (of such MCI data center). Notice of Scheduled Maintenance will be provided to Customer’s designated point of contact by a method elected by MCI (telephone, email or pager). MCI shall not schedule any maintenance which by design would impair any service directly. MCI may schedule and perform maintenance under the terms of this Section which may impact the redundancy of a service element. MCI shall use commercially reasonable efforts to avoid Emergency Maintenances activities which may impair a service directly. MCI will notify Customer promptly before performing emergency maintenances with as much notice as is practical, and/or will notify Customer immediately upon the completion of such maintenance

Premium Data Center Services Pricing Schedule (US Only)

I. EQUIPMENT SPACE OPTIONS

Equipment Space Options Cabinet	Install Fee		Monthly Charge (each)
Web-server Cabinet	[	* ]	$	[	* ]
Web-server Half Cabinet	[	* ]	$	[	* ]

Cage (minimum footprint of 5 Cabinets)	Install Fee		Monthly Charge (each)
One 1 Web-server Cabinet in a Cage	[	* ]	$	[	* ]
One 1 Two-Post Rack in a Cage	[	* ]	$	[	* ]
Custom (Single Cabinet footprint in a Cage.)	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

15

II. POWER OPTIONS

A. STANDARD POWER. Each cabinet is provisioned with 20 Amp 110 Volt AC Power unless an Optional Power Upgrade is selected in lieu of Standard Power.

B. OPTIONAL POWER UPGRADES

Power	Install Fee (each)			Monthly Charge (each) (Not Discountable)
30 amp 110 volt	$	[	* ]	$	[	* ]
50 amp 110 volt	$	[	* ]	$	[	* ]
20 amp 208 volt	$	[	* ]	$	[	* ]
30 amp 208 volt	$	[	* ]	$	[	* ]
50 amp 208 volt	$	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

16

C. ADDITIONAL POWER OPTIONS (Supplemental power to Standard Power Options or to Optional Power Upgrades). DC Power is not available in the San Jose data center. MCI pre-approval must be obtained before ordering DC Power in the Elmsford Richardson or Atlanta Data Center.

AC Power	Install Fee (each)			Monthly Charge (each) (Not Discountable)
20 amp 110 volt	$	[	* ]	$	[	* ]
30 amp 110 volt	$	[	* ]	$	[	* ]
50 amp 110 volt	$	[	* ]	$	[	* ]
20 amp 208 volt	$	[	* ]	$	[	* ]
30 amp 208 volt	$	[	* ]	$	[	* ]
50 amp 208 volt	$	[	* ]	$	[	* ]

DC Power	Install Fee (each)		Monthly Charge (each) (Not Discountable)
30 amp	[	* ]	$	[	* ]
35 amp	[	* ]	$	[	* ]
40 amp	[	* ]	$	[	* ]
45 amp	[	* ]	$	[	* ]
50 amp	[	* ]	$	[	* ]
55 amp	[	* ]	$	[	* ]
60 amp	[	* ]	$	[	* ]

III. CABINET CABLING

Enables Inter-connections between multiple cabinets of the same customer Also may be used to establish connectivity between different customers if both parties agree

Cable Type	Install Fee (each)
Twisted Pair Copper (Cat 5)	$	[	* ]

IV. CROSS-CONNECTS

Cable Type	Monthly Charge (each)
POTS Line Cable	$	[	* ]
Twisted Pair Cable (DS-1)	$	[	* ]
Coax Cable (DS3)	$	[	* ]
Fiber Cable (OCx, Gigabit Ethernet)	$	[	* ]

V. ADDITIONAL ON-SITE TECHNICAL SUPPORT (“Hands and Eyes Support”)

First [ * ] hours per month of Hands-and-Eyes Support are provided at no charge Thereafter Hands-and-Eyes Support is billed at $[ * ] per hour in 15-minute increments

Premium Data Center Services Internet Bandwidth Pricing Schedule (US Only)

I. PRIMARY INTERNET CONNECTIVITY

A. TIERED SERVICE

Bandwidth Tier	Install Fee			Monthly Charge
1 Mbps	$	[	* ]	$	[	* ]
1.5 Mbps	$	[	* ]	$	[	* ]
3 Mbps	$	[	* ]	$	[	* ]
6 Mbps	$	[	* ]	$	[	* ]
10 Mbps	$	[	* ]	$	[	* ]
15 Mbps	$	[	* ]	$	[	* ]
20 Mbps	$	[	* ]	$	[	* ]

B. BURSTABLE SERVICES

1. 100 Mbps Burstable service

Monthly Minimum Usage Commitment	Install Fee			Monthly Charge			Overage Charge (per Mpbs)
1 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
1.5 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
3 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
6 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
10 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
15 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
20 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
30 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
50 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

2. 1.000 Mbps Burstable Services. All Internet connectivity for bandwidth over 100 Mbps is delivered over fiber optic circuits. Customer is responsible for providing, at its sole expense, the Gig E card on its side of the connection necessary to accept such a high bandwidth connection and a Layer 3 device that supports 1000 BASE-SX Multi Mode SC connections

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

17

Monthly Minimum Usage Commitment	Install Fee			Monthly Charge			Overage Charge (per Mbps)
50 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

II. SHADOW INTERNET CONNECTIVITY

Shadow Service is only available with acquisition of Primary Internet Connectivity 100 Mbps of Shadow Internet Connectivity requires acquisition of 100 Mbps or higher Primary Internet Connectivity

Bandwidth Tier	Install Fee			Monthly Charge			Each Mbps > 64Kbps
0 -100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
>100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

III. DOMAIN NAME SERVICE

Data Center Internet Bandwidth includes Domain Name Service (DNS) for hosting one domain name A Fee of $[ * ] per domain name will be charged for each additional DNS domain name hosted by MCI. Customer is responsible for registering and renewing its domain name(s); MCI will not register or renew Customer’s domain names.

IV. DIVERSE INTERNET CONNECTIVITY

A TIERED SERVICE

Bandwidth Tier	Install Fee			Monthly Charge
1 Mbps	$	[	* ]	$	[	* ]
1.5 Mbps	$	[	* ]	$	[	* ]
3 Mbps	$	[	* ]	$	[	* ]
6 Mbps	$	[	* ]	$	[	* ]
10 Mbps	$	[	* ]	$	[	* ]
15 Mbps	$	[	* ]	$	[	* ]
20 Mbps	$	[	* ]	$	[	* ]

B BURSTABLE SERVICES

1 100 Mbps Burstable Services

Monthly Minimum Usage Commitment	Install Fee			Monthly Charge			Overage Charge (per Mbps)
1 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
1.5 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
3 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
6 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
10 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
16 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
20 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
30 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
60 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

2 1,000 Mbps Burstable Services. All Internet connectivity for bandwidth over 100 Mbps is delivered over fiber optic circuits. Customer is responsible for providing, at its sole expense, the Gig E card on its side of the connection necessary to accept such a high bandwidth connection and a Layer 3 device that supports 1000 BASE-SX Multi Mode SC connections

Monthly Minimum Usage Commitment	Install Fee			Monthly Charge			Overage Charge (per Mbps)
50 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

V. LOAD BALANCING

A LOCAL SERVER LOAD BALANCING (SLB) Service – SLB Service distributes Internet traffic to Customer’s servers located in a single MCI Data Center.

	Install Fee			Monthly Charge
16 VIPs	$	[	* ]	$	[	* ]
32 VIPs	$	[	* ]	$	[	* ]

B GLOBAL SERVER LOAD BALANCING (GSLB) SERVICE—GSLB Service distributes Internet traffic to Customer’s servers located in two (2) or more MCI Data Centers

	Install Fee (per Facility)			Monthly Charge (per Facility)
16 VIPs	$	[	* ]	$	[	* ]
32 VIPs	$	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

18

VI. BACKUP & RESTORE SERVICES

Customer will receive the Backup & Restore Service described below [ * ] “Local” Backup & Restore Services are available in Atlanta, GA; Ashburn, VA; Boston, MA; Carteret, NJ: Chicago, IL; Los Angeles and San Jose, CA “Network” Backup & Restore Services are available in Denver, CO; Miami, FL; Elmsford, NY; Houston and Richardson, TX; Seattle, WA.

Committed Monthly Storage Usage	Monthly Charge			Charge per GB Used in Excess of Committed Storage Usage
50 GB	$	[	* ]	$	[	* ]
100 GB	$	[	* ]	$	[	* ]
200 GB	$	[	* ]	$	[	* ]
300 GB	$	[	* ]	$	[	* ]
500 GB	$	[	* ]	$	[	* ]
1,000 GB	$	[	* ]	$	[	* ]
2,000 GB	$	[	* ]	$	[	* ]
3,000 GB	$	[	* ]	$	[	* ]
5,000 GB	$	[	* ]	$	[	* ]
10,000 GB	$	[	* ]	$	[	* ]
16,000 GB	$	[	* ]	$	[	* ]
20,000 GB	$	[	* ]	$	[	* ]

Additional Charges	Charge
Install Fee (Per Server)	$	[	* ]
Recall Charge (per Recall Incident)	$	[	* ]
Eject Charge (per Tape)	$	[	* ]

VII. POP MAILBOXES

	Install Fee	Monthly Charge (Not Discountable)
POP Mailboxes (Max 500)	No Charge	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange

Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

19

MCI Service Agreement

Services Attachment (Continued)

Special Pricing

for Danger Inc.

During the Term, Customer will receive the following rates and discounts which are IN LIEU OF all standard discounts and will be applied to the standard rates for MCI Service Agreement Service for a [ * ] term commitment and a [ * ] annual volume commitment

Premium Data Center Service (Option 4) Customer will pay the standard rates set forth in the Services Attachment for Premium Data Center Service less the following discounts off of the [ * ] charges for the Service Types set forth below. These discounts are in lieu of any other discounts or promotions

Service Type	Discount
Space	[	* ]%
Bandwidth and Overage	[	* ]%
Cross Connect	[	* ]%

Premium Data Center Service Installation Waiver MCI will waive the space, bandwidth and power installation charges associated with the implementation of Premium Data Center Service under this Agreement

One-Time Credits. Customer will receive [ * ] one-time credits which will be applied against Service Charges incurred under this Agreement provided the credit is applied to no more than [ * ] Customer account numbers per month. The [ * ] in the amount of [ * ] Dollars ($[ * ]) will be applied in the [ * ] monthly billing period following the Effective Date of this Agreement. The [ * ] in the amount of [ * ] Dollars ($[ * ]) will be applied in the [ * ] monthly billing period following the Effective Date of this Agreement. The [ * ] in the amount of [ * ] Dollars ($[ * ]) will be applied in the [ * ] monthly billing period following the Effective Date of this Agreement. CUSTOMER WILL DESIGNATE, IN WRITING, 30 CALENDAR DAYS BEFORE THE CREDIT IS DUE WHERE CREDITS ARE TO BE APPLIED IN FULL with the exception of those charges where Customer has notified MCI in writing of a bona fide dispute. POSTING OF CREDITS CANNOT OCCUR UNTIL FINAL ACCOUNT DIRECTION IS GIVEN. IF WRITTEN CUSTOMER DIRECTION IS NOT PROVIDED WITHIN SAID 30 CALENDAR DAYS THE CREDIT WILL BE APPLIED TO THE OLDEST CUSTOMER BALANCES FOR SERVICES COVERED UNDER THE AGREEMENT

Metro Private Line Service (Option 1). Customer will pay the following rates for Metro Private Line Service based on the Service Type and [ * ] locations set forth below These rates are in lieu of any other rates, discounts or promotions and do not include charges for Access Service

Service Type	[ * ]	[ * ]	Monthly Recurring Charge			Installation Charge
*DS3	850-634 (AT&T Redwood City, CA)	408-273 (MCI - SJ1 Data Center)	$	[	* ]	[	* ]
DS3	925-694	408-273	$	[	* ]	[	* ]
0C3	650-280	408-273	$	[	* ]	[	* ]

* Customer may terminate any DS3 Metro Private Line circuit at any time during the Term without penalty.

Data Center Set Up Fee. Customer agrees to pay MCI $[ * ] per [ * ] for the first [ * ] of the Initial Term (the “Set Up Fee”). The Set Up Fee will be billed to Customer on a monthly basis on MCI’s monthly bill. The Set Up fee will provide for a) the ability for Customer to utilize up to 80 Amps of power and b) prepare MCI’s San Jose Data Center to handle the increased power requirements

Data Center Custom Net Pricing. The following section indicates, for clarity the net pricing Customer will pay per rack based on power requirements in their custom cage space at the MCI San Jose Premium Data Center:

1. Custom Cage containing 50 Premium Cabinets, with an initial configuration of two (2) NON-redundant 1x20A 110V power strips per cabinet:

• $[ * ] per two-post rack with 2X20AX110V (40 AMP USABLE )

2. Custom Cage containing 50 Premium Cabinets, with an upgrade two (4) non-redundant* 1x20A 110V power strips per cabinet:

• $[ * ] per two-post rack with 4X20AX110 (80 AMP USABLE)

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

FIRST AMENDMENT TO THE

MCI SERVICE AGREEMENT

This First Amendment to the MCI Service Agreement (“First Amendment”) is entered into as of the dates set forth below, by and between Danger, Inc. (“Customer”) and MCI WORLDCOM Communications, Inc., on behalf of itself and its affiliates and their respective successors (together “MCI”). Provided that this First Amendment is executed by MCI, the rates, charges and discounts contained herein shall be effective on the first (1^st) day of the second (2^nd) billing cycle following Customer’s signature and delivery of this First Amendment to MCI (“First Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and MCI entered into the MCI Service Agreement executed by MCI on October 14, 2004 (the “Agreement”) with respect to certain services to be provided to Customer by MCI, as more particularly described therein; and

WHEREAS, Customer and MCI wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

31. Services. Section 1 (“Services”) of the Agreement is hereby amended by deleting this section in its entirety and by replacing it with the following new section.

1. SERVICES. MCI may provide to Customer the following international, interstate, intrastate and local communications services: Option 1 Access (Network), Option 4 Access (Network), Option 4 Data Center Services – Premium, Option 4 Data Center Services – Premium IP Bandwidth, Option 1 Private Line – Domestic IXC, Option 1 Private Line – Metro and Option 1 Private Line – Access (“Services”) and those identified in the Services Attachments to this Agreement, which are incorporated by reference. The prices and rates for Services listed herein may be purchased by Customer during the Term. Customer will only be billed for Services after Customer has ordered such Services and such Services have been installed (e.g., for Data Center Services, upon the Service Activation Date as defined in Section C of the Terms and Conditions under the Data Center Services (U.S. Only) Service Attachment to this Agreement).

32. Address Change. The Richardson, Texas address for MCI in Section 23 (“Notice”) of the Agreement is hereby amended by deleting the address in its entirety, and by replacing it with the following new address:

To MCI:

MCI WORLDCOM Communications, Inc.

20855 Stone Oak Parkway

San Antonio, TX 78258

Attn: Customer Service

Email: notice@mci.com

33. Data Center Custom Net Pricing. The “Data Center Custom Net Pricing” section of the Special Pricing Attachment to the Agreement is hereby amended by adding the following new Subsections:

3. Premium Data Center Racks. Customer will pay the following rates per rack for Premium Data Center Services.

3.1 Premium Data Center Racks. Customer will have up to 30 racks in either configuration or a combination of both as outlined below:

(a) Customer will pay $[ * ] per rack for up to an additional 30 premium racks with a configuration of two (2) NON-redundant 1X20A 110V power per rack (40 AMP USABLE); or

(b) Customer will pay $[ * ] per rack for up to an additional 30 premium racks with a configuration of four (4) NON-redundant 1X20A 110V power per rack (80 AMP USABLE).

3.2 Qualifying Condition. In order to qualify for the rates set forth in Sections 3.1 and 3.2 above, Customer agrees to [ * ] in the [ * ] for the [ * ] of the [ * ].

3.3 [ * ] Fee Waiver. Notwithstanding anything to the contrary in the above section entitled “Premium Data Center Service Installation Waiver: 1) MCI will waive the [ * ] fee per [ * ] of $[ * ] for the [ * ] per Sections 3.1 and 3.2 above, and 2) if Customer terminates any of the [ * ] prior to the expiration of the Term, MCI will debit Customer’s account for a pro rata portion of said [ * ] fee.

34. Special Pricing. The Special Pricing Attachment to the Agreement is hereby amended by adding the following new Sections:

Installation Waiver. MCI will waive the one-time installation charges associated with the implementation of Services within the 48 contiguous States of the U.S. provided under this Agreement; except for the following services: (i) VPN, (ii) PTT / third party services (including International Access and MCI International), (iii) Data Center (other than as expressly stated above for Premium Data Center Services), (iv) MCI Managed Services, (v) CPE, (vi) MCI Advantage, and (vii) MCI Security. Usage charges, monthly recurring charges, expedite charges, change charges, surcharges, any charges imposed by third parties (including access, egress, jack, or wiring charges), taxes or tax-like surcharges, or other Governmental Charges will not be waived.

Dedicated Access Service (Options 1 and 4). Customer will pay the following monthly recurring local loop charges for Dedicated Access Service (Options 1 and 4) based on Service Type and NPA-NXX. These rates are in lieu of any other rates, discounts or promotions.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

Service Type	NRA-NXX		Monthly Recurring Local Loop Charge
DS3	408-273	*		[	* ]
DS3	949-467		$	[	* ]

* MCI reserves the right to revise this rate if Customer orders any Type 2 or Type 3 DS3 Dedicated Access circuits at this NPA-NXX.

Domestic Private Line Service (Option 1). Customer will pay the standard MBSI rates for Domestic Private Line Service (Option 1) less the following discounts off the monthly recurring charges for the Service Types set forth below. These discounts are in lieu of any other discounts or promotions.

Service Type	Discount
DS0	[	* ]%
DS1	[	* ]%
DS3	[	* ]%

35. Entire Agreement. Except as expressly modified by this First Amendment, the Agreement shall be and remain in full force and effect in accordance with its terms and shall constitute the legal, valid, binding and enforceable obligations of Customer and MCI. This First Amendment, the Agreement, and the applicable MCI Tariffs and Service Publication and Price Guide, collectively, are the complete agreement of the parties and supersede any prior agreements or representations, whether oral or written, with respect thereto.

36. Acceptance Deadline. Pricing and/or promotional benefits in this First Amendment may not be available if it is signed and delivered to MCI after March 28, 2005. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS WHEREOF, MCI and Customer have caused this First Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the First Amendment Effective Date.

Danger, Inc.		MCI WORLDCOM Communications, Inc.
By:	/s/ Henry R. Nothhaft	By:	/s/ Suleiman Hessami
Name:	Henry R. Nothhaft	Name:	Suleiman Hessami
Title:	Chairman & CEO	Title:	Senior V.P., Business Development
Date:	3/28/05	Date:	5/13/05

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2

SECOND AMENDMENT TO THE

MCI SERVICE AGREEMENT

This Second Amendment to the MCI Service Agreement (“Second Amendment”) is entered into as of the dates set forth below, by and between DANGER INC. (“Customer”) and MCI WORLDCOM COMMUNICATIONS, INC., on behalf of itself and its affiliates and their respective successors (together “MCI”). Provided that this Second Amendment is executed by MCI, the rates, charges and discounts contained herein shall be effective on the first (1^st) date of the second (2^nd) billing cycle following Customer’s signature and delivery of this Second Amendment to MCI (“Second Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and MCI entered into a MCI Service Agreement executed by Customer on October 8, 2004 with respect to certain services to be provided to Customer by MCI, as more particularly described therein, and as amended by that certain first Amendment, executed by Customer on March 28, 2005 (collectively, the MCI Service Agreement and the first Amendment shall be referred to as the “Agreement”).

WHEREAS, Customer and MCI wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties herein hereby agree as follows:

37. WAN Defense Mitigation Services. A new Section (WAN Defense Mitigation Services) is added to the Other Services of the Service Attachment to the MCI Service Agreement as follows:

WAN Defense Mitigation Services. MCI will provide to Customer MCI WAN Defense Mitigation Services under the terms and conditions set forth in the Agreement and Schedule 1, which is attached hereto and incorporated herein by reference. MCI WAN Defense Mitigation Services monthly recurring and usage charges, after the application of discounts, will contribute to the AVC.

38. Entire Agreement. Except as expressly modified by this Second Amendment, the Agreement shall be and remain in full force and effect in accordance with its terms and shall constitute the legal, valid, binding and enforceable obligations of Customer and MCI. This Second Amendment, the Agreement, and the applicable MCI Tariffs and Service Publication and Price Guide, collectively, are the complete agreement of the parties and supersede any prior agreements or representations, whether oral or written, with respect thereto.

39. Acceptance Deadline. Pricing and/or promotional benefits in this Amendment may not be available if it is signed and delivered to MCI after June 30, 2005. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS WHEREOF, MCI and Customer have caused this Second Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the Second Amendment Effective Date.

Danger, Inc.		MCI WORLDCOM Communications, Inc.
By:	/s/ Henry R. Nothhaft	By:	/s/ Suleiman Hessami
Name:	Henry R. Nothhaft		Suleiman Hessami
Title:	Chairman and CEO		Senior Vice President, Business Development
Date:	6//30/05	Date:	7/6/05

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

SCHEDULE 1

WAN DEFENSE MITIGATION

SERVICE ATTACHMENT

(US ONLY)

I. RATES AND CHARGES.

A. Service Term Commitment. Service Term Commitment (“Service Term”) for WAN Defense Mitigation applies to each order under this Service Attachment and shall commence upon the Second Amendment Effective Date and will automatically renew, expire and terminate in accordance with the terms of the Agreement. This service attachment and the related Agreement will apply to orders for WAN Defense Mitigation placed during the term of the Agreement.

B. WAN Defense Mitigation Service. Customer will pay the applicable monthly recurring charge (“MRC”) and the applicable non-recurring charge (“NCR”) based on the shared capacity selected from the table below.

Shared Capacity	NRC			Current 4 Year Term MRC
500mb*	$	[	* ]	$	[	* ]

* Customer shall pay an install fee for each increment unless such increment is at the same location.

II. TERMS AND CONDITIONS

A. General

This service attachment describes the rates, terms and conditions for the WAN Defense Mitigation service (“WAN Defense Mitigation”). WAN Defense Mitigation provided pursuant to this service attachment is governed by the Guide (www.mci.com/guide) (as applied to Internet, Enhanced and other Non-regulated Products and services), as supplemented by this service attachment and the related master agreement of which it is a part (“Agreement”).

MCI may provide the service directly and/or through its suppliers. References to “MCI” in the provisions of this service attachment and related Agreement that limit liability and disclaim warranties or damages include such suppliers and their affiliates, directors, officers, employees or agents. These limitations are independent of each remedy in the Agreement and are intended to survive and be enforceable under any circumstances without exception. MCI reserves the right to replace, modify, suspend or terminate WAN Defense Mitigation within 90 days of informing Customer by invoice message, email or other reasonable means, if in MCI’s sole discretion, such action is appropriate under the circumstances (e.g., because of the loss of a supplier). A dedicated internet connection of at least a T1 is required for WAN Defense Mitigation. WAN Defense Mitigation is available only in the United States to customers

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2

incorporated in the United States under an Agreement governed by the law of one of the United States. WAN Defense Mitigation will be billed in the United States, in U.S. dollars and is only available in the U.S.

B. Service Description

1. WAN Defense Mitigation. WAN Defense Mitigation is a managed network-based traffic analysis service providing anomaly detection and alerts for subscribed customers when their traffic deviates from normal traffic patterns. Traffic deviation is typically a sign that a denial-of-service attack is either enroute or in progress. MCI has the capabilities to divert this malicious traffic away from the subscriber’s network, while maintaining the integrity of the customer’s network if the customer’s network communication is potentially compromised. All equipment associated with WAN Defense Mitigation resides on the MCI network and remains the property of MCI.

A denial-of-service attack (DoS Attack) is one in which a multitude of compromised systems attack a single target by flooding the target system with malicious traffic which essentially exhausts available capacity and denies access to the service by legitimate users.

The WAN Defense Mitigation capabilities include the customer’s ability to trigger a network-based redirection of valid traffic and DoS Attack traffic to pre-deployed mitigation centers; and MCI’s determination of status and metrics associated with any DoS Attack, identification and separation of DoS Attack traffic from legitimate traffic and forwarding of valid traffic back to the customer.

WAN Defense Mitigation will be sold in shared capacity of 500 mb to 3 Gigs of traffic per site. If a customer requires capacity in excess of 3 Gigs of traffic per site, the customer is required to purchase additional capacity in tiers of 500 mb from MCI.

2. Activation. Before activation, Customer must complete and provide the appropriate, current configuration form which will be provided to Customer by a MCI configuration engineer. After proper completion of a configuration form by Customer, MCI will activate the WAN Defense Mitigation service. MCI acknowledges that Customer’s configuration information is “Confidential Information” as defined in the Agreement.

3. Acceptance Testing. To test for proper function of the WAN Defense Mitigation after activation by MCI, a special type of Border Gateway Protocol (BGP) routing announcement is made either by the Customer or by MCI’s Security Operation Center (SOC) into MCI’s BGP routing tables. This routing updated redirects the network traffic to MCI’s mitigation centers, and then down a Generic Router Encapsulation (GRE) tunnel to the Customer – a transparent change for most customers. Once MCI’s SOC has verified the tunnel is functioning and configured as instructed by Customer via a variety of tools, notification of this verification will be sent to Customer, and consequently, WAN Defense Mitigation shall be deemed properly configured and activated. Customer shall conduct and complete acceptance testing within 10 calendar days and configuration and activation has been completed by MCI. If the Customer does not conduct and complete acceptance testing within the aforementioned timeframe, MCI will assume the WAN Defense Mitigation configuration is accurate and commence billing.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

3

4. Service Configuration. MCI will configure WAN Defense Mitigation in accordance with Customer’s configuration submission sent by Customer to MCI via the email account designated by Customer on the customer configuration form. Customer is required to configure the router it intends to utilize with WAN Defense Mitigation to accept a GRE tunnel and MCI will provide Customer with examples as to how to complete this task. Customer is responsible for confirming that its WAN Defense Mitigation service configuration is configured in accordance with Customer’s preferences prior to and after activation.

5. Administration. After activation and receipt of a Customer administrative request via the MCI SOC web portal (which such request MCI agrees is appropriate in its sole discretion), MCI will administer changes needed for the Customer’s network traffic to be diverted to a MCI mitigation center. The MCI SOC will gather data regarding customer traffic patterns to create a baseline of traffic patterns that shows the allowable traffic to the Customer network and utilize such information when defining parameters associated with the Customer traffic based on what appears to be excess or non-standard traffic activity (“tuning”). Tuning will take place after the initial activation of WAN Defense Mitigation and can be updated quarterly by MCI at Customer’s request. There are no limitations on the number of Customer IP addresses and zone change requests by Customer for WAN Defense Mitigation.

6. Monitoring. WAN Defense Mitigation includes proactive monitoring of the WAN Defense Mitigation MCI provided equipment such as a.) verifying necessary MCI provided equipment is running properly and b.) checks for capacity, utilization, and version updates of applicable software.

7. Reports. MCI will make available daily traffic reports via email account designated by Customer on the Customer configuration form.

8. Disclaimer. WAN Defense Mitigation is provided “As Is” without warranties of any kind. MCI’s entire liability and Customer’s sole and exclusive remedies regarding WAN Defense Mitigation (including without limitation relating to installation and performance) are set forth in the SLA for WAN Defense Mitigation. Customer acknowledges and agrees that (a) WAN Defense Mitigation constitutes only one component of Customer’s overall security program and it’s not a comprehensive security solution, and (b) there is no guarantee that WAN Defense Mitigation will be uninterrupted or error-free or that WAN Defense Mitigation will meet Customer’s requirements.

III. CONDITIONS OF SERVICE

A. Customer Obligations. Customer shall comply with all obligations set forth in this Service Attachment and the related Agreement. In the event of a DoS Attack, Customer is solely responsible for activating WAN Defense Mitigation either by rerouting traffic to an MCI filtering device or contacting MCI in order for MCI to perform such rerouting function. Customer shall also be responsible for discontinuance of the rerouting of traffic at the conclusion of a DoS Attack or may request that MCI discontinue such rerouting of traffic.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

4

B. Service Activation Date. Billing of MRCs will commence as of the date WAN Defense Mitigation has been accepted (or deemed accepted) by Customer, to be indicated to Customer by the MCI configuration engineer (“Service Action Date”). The initial invoice may contain multiple MRCs. In no event will the Service Activation Date be deemed to have occurred before MCI has configured the WAN Defense Mitigation service and tested the accuracy of the configuration based on the information supplied by the Customer on the configuration form.

C. Termination. If Customer terminates WAN Defense Mitigation ordered under this Service Attachment, or any portion thereof, during a Service Term, except for termination for cause or as permitted in the SLA, such termination shall not be effective until 60 days after MCI receives written notice of termination (the “Termination Effective Date”); and Customer will pay, within 30 days after such Termination Effective Date: (a) [ * ]; plus (b) an amount equal to [ * ], if any; plus (c) an amount equal to [ * ], if applicable (d) a [ * ], provided that, in no event will Customer’s total termination liability exceed the full contract value of the terminated WAN Defense Mitigation service.

D. Export Compliance. Customer acknowledges that the export, import, and use of certain hardware, software and technical data provided hereunder is regulated by the United States and other governments and agreed to comply with all applicable laws and regulations, including the U.S. Export Administration Act, the regulations implemented thereunder by the Department of Commerce, and any other applicable laws or regulations, Customer represents and warrants that it is a U.S. citizen or permanent resident, or a corporation organized under the laws of one or more of the United States of America, that Customer is not procuring WAN Defense Mitigation on behalf of a foreign national, and that Customer is not subject to a U.S. government order suspending, revoking or denying export privileges.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

5

WAN Defense Mitigation

Service Level Agreement

I. CONFIGURATION AND ACTIVATION SLA

A. Standard: MCI will configure and activate Customer’s WAN Defense Mitigation within 14 days after MCI receives from Customer and validates the Customer configuration form.

B. Remedy: A credit against invoice for the following month equal to 50% of the WAN Defense Mitigation NRC, net of discount and taxes billed to Customer.

C. Limitations: See the General terms provisions below.

II. REACTIVE RESPONSE SLA

A. Standard: MCI will respond within 15 minutes of its SOC receiving effective notice, and confirming the validity of such notice, from Customer that it is under a DoS Attack.

B. Remedy: A credit against invoice for the following month equal to one day’s share of the WAN Defense Mitigation MRC.

C. Limitation: This Restrictive Response SLA is triggered when the SOC receives an alert form Customer that they are under a Dos Attack. For the purpose of this Reactive Response SLA, MCI defines a Dos Attack as an attack that causes more than 95% bandwidth utilization at any given time.

III. ADMINISTRATIVE CHANGE SLA

A. Standard: After activation and receipt of a Customer administrative change request via the MCI SOC web portal (which such request MCI agrees is appropriate in its sole discretion), MCI will complete such administrative changes requested by Customer to the customer’s network traffic within 4 hours.

B. Remedy: A credit equal to one day’s share of the WAN Defense Mitigation MRC for each instance MCI fails to meet the 4 hour standard set forth above.

C. Limitations: This Administrative Change SLA is only triggered when the customer calls the SOC and a ticket is opened by Customer via the phone. The time in which MCI completes the administrative change will be measured from the time the Customer’s trouble ticket is properly opened to the time MCI closes the trouble ticket by confirming its completion of the administrative change. Incomplete or otherwise inadequate requests will not trigger this SLA, and consequently, will not be included in the time measurement. See also the General Terms provisions below.

IV. SHARED CAPACITY SLA

A. Standard: MCI shall ensure that Customer has 100% availability of the shared capacity purchased from MCI for the customer’s use 24/7.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

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B. Remedy: A credit equal to one day’s share of the WAN Defense Mitigation MRC.

C. Limitation: If the bandwidth of a DoS Attack exceeds the shared capacity, MCI may choose to drop that additional traffic.

V. GENERAL TERMS

A. Overview. This service level agreement (“SLA”) for WAN Defense Mitigation, which is made a part of the Agreement, is set forth at http://global.mci.com/terms/us/products/index.xml. MCI reserves the right to amend the SLA from time to time effective upon posting of the revised SLA to the URL cited above or other notice to Customer, provided, that in the event of any amendment resulting in a material reduction of the SLA’s service levels or credits, Customer may terminate WAN Defense Mitigation and this Second Amendment without penalty by providing MCI written notice of termination during the 90 days following notice of such amendment. The SLA sets forth Customer’s sole remedies for any claims relating to installation or performance of WAN Defense Mitigation, including any failure to meet any standard set forth in this SLA. MCI’s records and data shall be the basis for all SLA calculations and determinations.

MCI will provide WAN Defense Mitigation in accordance with the standards and remedies set out in this WAN Defense Mitigation SLA. Each individual standard and its related remedy is referred to by the activity to which the standard relates (e.g., Configuration and Activation SLA, Reactive Response SLA, Administrative Change SLA or Shared Capacity SLA). MCI reserves the right to enhance or restrict the WAN Defense Mitigation SLA in whole or in part.

B. Claims. To receive a remedy under the WAN Defense Mitigation SLA, Customer must open an SLA Challenge Trouble Ticket with the SOC by calling 1/800-900-0241 on or before the fifth business day immediately following the date on which the failure occurred. The Customer is provided a ticket number for the claim. MCI will use trouble tickets and other appropriate MCI records to determine, in its sole judgment, whether it met or failed to meet the applicable SLA. All references in this WAN Defense Mitigation SLA to “hours” and “days” means “business hours” and “business days,” unless explicitly stated otherwise. “One day’s share” of the WAN Defense Mitigation MRC is calculated by dividing the WAN Defense Mitigation MRC by the number of days in the billing cycle if a failure to meet a WAN Defense Mitigation SLA occurred. In no event may a Customer receive a total amount of credits for any month that exceeds the WAN Defense Mitigation MRC for that month. The remedies provided in the WAN Defense Mitigation SLA for each SLA are Customer’s sole remedy for any failure by MCI to meet the specified SLA.

C. Exclusions. No WAN Defense Mitigation SLA will apply if all the conditions for Customer to receive the remedy for that SLA have not been met (including both general limitations and the limitations applicable to that particular SLA). The remedies specified in this

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

7

WAN Defense Mitigation SLA are not available for any failure to meet a SLA resulting from any of the following: (1) a Non-MCI cause (as provided further below); (2) scheduled maintenance; (3) force majeure events, including but not limited to Acts of God, government regulation, labor strikes, natural disaster, and national emergency; (4) any act or omission on the part of any third party other than the LEC/PTT, as applicable; (5) interruptions not reported by Customer, or for which no trouble ticket was opened; (6) a circuit outage (except with respect to the Shared Capacity SLA).

A Non-MCI Clause includes, without limitation, any of the following (as identified on a trouble ticket or otherwise): (a) an incomplete or inaccurate order; (b) a customer-approved change in service configuration; (c) incorrect or incomplete callout information provided by Customer which prevents MCI from completing the trouble diagnosis and service restoration; (d) Customer’s failure or refusal to release the circuit for testing; (e) MCI calling Customer to close a trouble ticket, but Customer being unavailable, or MCI being unable to verify service restoration with a Customer, (f) any other act or omission on the part of Customer, or (g) down time caused by the LEC/PTT local loop for periods where the LEC/PTT’s maintenance support is not available, or (h) any other event beyond the reasonable control of MCI (“Non-MCI Clause”).

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

8

THIRD AMENDMENT TO THE

MCI SERVICE AGREEMENT

This Third Amendment to the MCI Service Agreement (“Third Amendment”) is entered into as of the dates set forth below, by and between Danger, Inc. (“Customer”) and MCI Network Services, Inc. or MCI Financial Management Corp., as applicable, on behalf of MCI Communications Services, Inc. d/b/a/ Verizon Business Services (individually and collectively “Verizon”). Provided that this Third Amendment is executed by Verizon, the rates, charges and discounts contained herein shall be effective on the first (1^st ) day of the second (2^nd) billing cycle following Customer’s signature and delivery of this Third Amendment to Verizon (“Third Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and Verizon entered into the MCI Service Agreement executed by Verizon on October 14, 2004 (the “Agreement”) with respect to certain services to be provided to Customer by Verizon, as more particularly described therein; and

WHEREAS, Customer and Verizon entered into the following amendments (collectively the Agreement and all amendments hereafter being referred to as the “Agreement”);

First Amendment executed by Verizon on or about May 13, 2005.

Second Amendment executed by Verizon on or about July 6, 2005.

Fourth Amendment executed by Verizon on or about October 26, 2006.

WHEREAS, Customer and Verizon did not execute a Third Amendment prior to the Fourth Amendment and wish to do so now for consistency.

WHEREAS, Customer and Verizon wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

40. Reference Name Change. The reference in the Agreement to “MCI Communications Services, Inc. (“MCI”)” is hereby deleted and restated as follows: MCI Network Services, Inc. or MCI Financial Management Corp., as applicable, on behalf of MCI Communications Services, Inc. d/b/a/ Verizon Business Services (individually and collectively “Verizon”). All references to “MCI” are hereby amended to read “Verizon” and all references to “MCI Business Services I” or “MBSI” are hereby amended to read “Verizon Business Service I” or “VBSI”.

41. Data Center Service. Section I.B.2 of the Premium Data Center Services Internet Bandwidth Pricing Schedule (US Only) of the Data Center Services (US Only) Service Attachment to the Agreement is hereby amended by adding the following new services, in consecutive order, to the table thereof:

Monthly Minimum Usage Commitment	Install Fee			Monthly Charge			Overage Charge (per Mbps)
150 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
200 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
250 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
350 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

42. Data Center Service. Section IV.B.2 of the Premium Data Center Services Internet Bandwidth Pricing Schedule (US Only) of the Data Center Services (US Only) Service Attachment to the Agreement is hereby amended by adding the following new services, in consecutive order, to the end of the table thereof:

Monthly Minimum Usage Commitment	Install Fee			Monthly Charge			Overage Charge (per Mbps)
150 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
200 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
250 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
350 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

43. Special Pricing. The “Service Type” and “Discount” table in the Premium Data Center Service (Option 4) section of the Special Pricing Attachment to the Agreement is hereby deleted and replaced s follows:

Service Type	Discount
Space	[	* ]%
Bandwidth and Overage (except for the table below)	[	* ]%
Gross Connect	[	* ]%

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

Service Type	Discount
Bandwidth and Overage for 1,000 Mbps Burstable Services (Primary Internet Connectivity and Diverse Internet Connectivity) at the following speeds:
160 Mbps	[	* ]%
200 Mbps	[	* ]%
250 Mbps	[	* ]%
350 Mbps	[	* ]%
500 Mbps	[	* ]%

44. Data Center Service Orders. This Amendment does not constitute an order by Customer for the Services priced herein and will not be construed as an obligation by Customer to order said Services. Customer will need to comply with the order process set forth in Section III.D (“Order Process”) of the Data Center Services (US Only) Service Attachment of the Agreement in order to receive said Services.

45. Entire Agreement. Except as expressly modified by this Third Amendment, the Agreement shall be and remain in full force and effect in accordance with its terms and shall constitute the legal, valid, binding and enforceable obligations of Customer and Verizon. This Third Amendment, the Agreement, and the applicable Verizon Tariffs and Service Publication and Price Guide, collectively, are the complete agreement of the parties and supersede any prior agreements and representations, whether oral or written, with respect thereto.

46. Acceptance Deadline. Pricing and/or promotional benefits in this Third Amendment may not be available if it is signed and delivered to Verizon after June 28, 2006. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS WHEREOF, Verizon and Customer have caused this Third Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the Third Amendment Effective Date.

Danger, Inc.		MCI Network Services, Inc. or MCI Financial Management Corp., as applicable
By:	/s/ Donn Dobkin	By:	/s/ Suleiman Hessami
Name:	Donn Dobkin	Name:	Suleiman Hessami
Title:	VP, Service Operations	Title:	VP, Pricing and Contract Management
Date:	6/26/06	Date:	7/7/06

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2

FOURTH AMENDMENT TO THE

MCI SERVICE AGREEMENT

This Fourth Amendment to the MCI Service Agreement (“Fourth Amendment”) is entered into as of the dates set forth below, by and between Danger, Inc. (“Customer”) and MCI Communications Services, Inc., on behalf of itself and its affiliates and their respective successors (together “MCI”). Provided that this Fourth Amendment is executed by MCI, the rates, charges and discounts contained herein shall be effective on the first (1^st) day of the second (2^nd) billing cycle following Customer’s signature and delivery of this Fourth Amendment to MCI (“Fourth Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and MCI entered into the MCI Service Agreement executed by MCI on October 14, 2004 (the “Agreement”) with respect to certain services to be provided to Customer by MCI, as more particularly described therein; and

WHEREAS, Customer and MCI entered into the following amendments (collectively the Agreement and all amendments hereafter being referred to as the “Agreement”):

First Amendment executed by MCI on or about May 13, 2005.

Second Amendment executed by MCI on or about July 6, 2005.

Third Amendment executed by MCI on or about                         , 2005.

WHEREAS, Customer and MCI wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

47. Name Change. MCI WorldCom Communications, Inc. has changed its name to “MCI Communications Services, Inc.” and the Agreement is herby amended as follows:

(a) The first sentence of the first paragraph of the Agreement is hereby amended to read as follows:

“This Agreement, together with any Attachments and Schedules (“Agreement”), is made by and between MCI Communications Services, Inc. (“MCI”), on behalf of itself and its affiliates and successors and Danger, Inc. (“Customer”).”

(b) All references to “MCI WorldCom Communications, Inc.” are hereby amended to read “MCI Communications Services, Inc.”.

48. Special Pricing. The Special Pricing Attachment to the Agreement is hereby amended by adding the following new Section:

One-Time Credit. Customer shall receive a one-time credit of $[ * ], which will be applied in the first monthly billing period of the Term following the Fourth Amendment Effective Date and will be applied against customer’s Interstate Total Service Charges. The total credit will be applied by MCI within a period of one month provided the credit is applied to no more than 10 Customer account numbers per month. Customer will designate, in writing, 30 calendar days before the credit is due where credits are to be applied in full, with the exception of those charges where Customer has notified MCI in writing of a dispute. Posting of credits cannot occur until final account direction is given. If written Customer direction is not provided within said 30 calendar days, the credit will be applied to the oldest Customer balances. If Customer’s Interstate Total Service Charges for such monthly billing period are less than the One-Time Credit, the excess amount of such One-Time Credit will then be applied to Customer’s Interstate Total Service Charges in the next consecutive monthly billing period. In no event will the amount of any such One-Time Credit exceed Customer’s Interstate Total Service Charges for the monthly billing period in which such credit is to be applied.

49. Metro Private Line Service (Option 1). The Metro Private Line Service (Option 1) section of the Special Pricing Attachment to the Agreement is hereby amended by adding the following new service to the end of the table thereof:

Service Type	[ * ] Origination	[ * ] Termination	Monthly Recurring Charge			Installation Charge
DS3	925-288	408-273	$	[	* ]	[	* ]

50. Entire Agreement. Except as expressly modified by this Fourth Amendment, the Agreement shall be and remain in full force and effect in accordance with its terms and shall constitute the legal, valid, binding and enforceable obligations of Customer and MCI. This Fourth Amendment, the Agreement, and the applicable MCI Tariffs and Service Publication and Price Guide, collectively, are the complete agreement of the parties and supersede any prior agreements or representations, whether oral or written, with respect thereto.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

51. Acceptance Deadline. Pricing and/or promotional benefits in this Fourth Amendment may not be available if it is signed and delivered to MCI after October 19, 2005. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS HEREOF, MCI and Customer have caused this Fourth Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the Fourth Amendment Effective Date.

Danger, Inc.		MCI Communications Services, Inc.
By:	/s/ Henry R. Nothhaft	By:	/s/ Suleiman Hessami
Name:	Henry R. Nothhaft		Suleiman Hessami
Title:	Chairman and CEO		Senior Vice President, Business Development
Date:	October 14, 2005	Date:	October 26, 2005

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2

FIFTH AMENDMENT TO THE

MCI SERVICE AGREEMENT

This amendment to the MCI Service Agreement (“Fifth Amendment”) is entered into as of the dates set forth below, by and between Danger, Inc. (“Customer”) and MCI Network Services, Inc. or MCI Financial Management Corp., as applicable, on behalf of MCI Communications Services, Inc. d/b/a/ Verizon Business Services (“Verizon”). Provided that this Fifth Amendment is executed by Verizon, the rates, charges and discounts contained herein will be effective on this first (1^st) day of the second (2^nd) billing cycle following Customer’s signature and delivery of this Fifth Amendment to Verizon (“Fifth Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and Verizon entered into the MCI Service Agreement executed by Verizon on October 14, 2004 (the “Agreement”) with respect to certain services to be provided to Customer by Verizon, as more particularly described therein; and as amended by that certain First Amendment executed by Verizon on May 13, 2005 and as amended by that certain Second Amendment executed by Verizon on July 6, 2005 and as amended by that certain Third Amendment executed by Verizon on July 7, 2008 and as amended by that certain Fourth Amendment executed by Verizon on October 28, 2005 (collectively, the Original Agreement and all amendments shall be referred to as the “Agreement”);

WHEREAS, Customer and Verizon wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

52. MCI Legacy Company Limitations. Except as expressly stated otherwise, promotional credits, discounts and other benefits under the Agreement do not apply to services provided by any entity other than an MCI Legacy Company. “MCI Legacy Company” means a Verizon affiliate providing Services under this Agreement that was an affiliate of MCI, Inc. prior to the acquisition of MCI, Inc. by Verizon Communications Inc., including the following entities: MCI Communications Services, Inc.; MCImetro Access Transmission Services, L.L.C.; MCImetro Access Transmission Services of Virginia, Inc.; or MCImetro Access Transmission Services of Massachusetts, Inc. Notwithstanding the name change described in paragraph 1 above, any pricing, SLAs and other contractual benefits based on certain network, circuits or other facilities being owned, provided or otherwise identified with an MCI Legacy Company or its predecessors (e.g., “on-net,” “Type 1”) do not apply where the related network, circuits or other facilities are owned, provided or otherwise identified with a company other than an MCI Legacy Company. All Services provided under the Agreement will be deemed to be provided by an MCI Legacy Company unless expressly noted otherwise in the Agreement.

53. Data Center Service. The Data Center Services (US Only) Service Attachment to the Agreement is hereby amended as follows:

(a) Section III (“Terms and Conditions”), on page 8 of the Original Agreement, is hereby amended by adding the following new sentence to the second bullet point (“AC power (2x20 Amp 110 Volt)…”) of Subsection A.3(i);

“Please refer to Section II.D (“Maximum Power Loads”) of the Premium Data Center Services Pricing Schedule (US Only) regarding the maximum load a circuit can carry.”

(b) Section III (“Terms and Conditions”), on page 13 of the Original Agreement is hereby amended by adding the following new sentence to the end of Subsection I. (Facility Floor Plans);

“Please refer to Section II.D (“Maximum Power Loads”) of the Premium Data Center Services Pricing Schedule (US Only) regarding the maximum load a circuit can carry.”

(c) Section II (“Power Options”) of the Premium Data Center Services Pricing Schedule (US Only) on page 16 of the Original Agreement, is hereby amended by adding the following new subsection:

D. Maximum Power Loads.

1. Customer will ensure the Equipment will not exceed 80 percent of the electrical load of the circuit breaker rating and shall be reasonable for any outage resulting from the Equipment exceeding such level 80 percent load of the circuit breaker rating Permanent use of extension cords is prohibited.

2. Customer acknowledges and understands that all Data Center circuits provided under this Agreement can only support a maximum load of 80 percent of the stated power amperage. For example, if a circuit is 2X20AX110V, each circuit can carry 80 percent of 20 amps at any given time, or 18 amps per circuit. This applies across all amperage levels.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

54. Data Center Service. The Agreement is hereby amended as follows:

(a) All references in the Agreement to the term “usable” in the context of amperage are hereby deleted.

(b) The “Data Center Custom Net Pricing” section of this Special Pricing Attachment to the Agreement is hereby amended as follows:

(i) Subsection 1 is hereby amended by deleting the reference to “(40 AMP USABLE).”

(ii) Subsection 2 is hereby amended by deleting the reference to “(80 AMP USABLE).”

(iii) Subsection 3.1(a) is hereby amended by deleting the reference to “(40 AMP USABLE).”

(iv) Subsection 3.1(b) is hereby amended by deleting the reference to “(80 AMP USABLE).”

55. Data Center Custom Net Pricing. Effective as of the Fifth Amendment Effective Data, the “Data Center Custom Net Pricing” section of the Special Pricing Attachment to the Agreement is hereby amended by adding the following new Subsections:

4. For Custom Cage power, Customer will pay a monthly recurring charge of $[ * ] for each 1X20A@110V ordered after the Fifth Amendment Effective Date. For example, if Customer orders 40 whips, Customer will be charged 40 whips X $[ * ] for a total of $[ * ] per month.

5. Premium Data Center Service Installation Waiver. For each 1X20A@110V whip of Custom Cage power that Customer orders after the Fifth Amendment Effective Date, Customer will pay a non-recurring charge of $[ * ] per whip.

5.1 Installation Fee Waiver. Notwithstanding anything to the contrary in the above section entitled “Premium Data Center Service Installation Waiver”: 1) Verizon will waive the one-time installation fee of $[ * ] for the Custom Cage power whips ordered and installed per Section 5 above, and 2) if Customer terminates without replacing any said 1X20A@110V power whip or any cabinet containing said 1X20A@110V power whip prior to the expiration of the Term, Verizon will debit Customer’s account for a pro rata portion of said installation fee. The debit amount, if any, will be determined by the number of Customer’s power whips ordered and installed during the applicable Contract Year in review against the number of such whips remaining installed at the conclusion of said Contract Year, Customer’s Verizon account team will conduct the review and any debit resulting from a review will require the execution of a separate amendment.

56. Entire Agreement. Except as expressly modified by this Fifth Amendment, the Agreement shall be and remain in full force and effect in accordance with its terms and shall constitute the legal, valid, binding and enforceable obligations of Customer and Verizon. This Fifth Amendment, the Agreement, and the applicable Verizon Tariffs and Service Publication and Price Guide, collectively, are the complete agreement of the parties and supersede any prior agreements and representations, whether oral or written, with respect thereto.

57. Definitions. All capitalized terms used herein and not expressly defined herein shall have the respective meanings given to such terms in the Agreement.

58. Acceptance Deadline. Pricing and/or promotional benefits in this Fifth Amendment may not be available if it is signed and delivered to Verizon after August 24, 2006. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS WHEREOF, Verizon and Customer have caused this Fifth Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the Fifth Amendment Effective Date.

Danger, Inc.		MCI Network Services, Inc. or MCI Financial Management Corp., as applicable
By:	/s/ Arnold Magcale	By:	/s/ Suleiman Hessami
Name:	Arnold Magcale	Name:	Suleiman Hessami
Title:	Senior Manager	Title:	VP, Pricing and Contract Management
Date:	8/18/06	Date:	9/11/06

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2

SIXTH AMENDMENT TO THE

MCI SERVICE AGREEMENT

This amendment to the MCI Service Agreement (“Sixth Amendment”) is entered into as of the dates set forth below, by and between Danger, Inc. (“Customer”) and Verizon Business Financial Management Corp., on behalf of MCI Communications Services, Inc. d/b/a Verizon Business Services, and applicable MCI Legacy Companies (individually and collectively “Verizon”). Provided that this Ninth Amendment is executed by Verizon, the rates, charges and discounts contained herein will be effective on the first (1^st) day of the second (2^nd) billing cycle flowing Customer’s signature and delivery of this Sixth Amendment to Verizon (“Sixth Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and Verizon entered into the MCI Service Agreement executed by Customer on October 8, 2004 (“Original Agreement”) with respect to certain services to be provided to Customer by Verizon, as more particularly described therein, and as amended by that certain First Amendment executed by Customer on March 28, 2005, as amended by that certain Second Amendment executed by Customer on June 30, 2005, as amended by that certain Third Amendment executed by Customer on June 26, 2006, as amended by that certain Fourth Amendment executed by Customer on October 14, 2005, as amended by that certain Fifth Amendment executed by Customer on August 18, 2006, (collectively, the Original Agreement and all amendments shall be referred to as the “Agreement”);

WHEREAS, Customer and Verizon wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

59. Reference Name Change. The reference in the Agreement to “MCI Network Services, Inc. or MCI Financial Management Corp., as applicable, on behalf of MCI Communications Services, Inc. d/b/a Verizon Business Services (“Verizon”) is hereby deleted and restated as follows:

“Verizon Business Financial Management Corp., on behalf of MCI Communications Services, Inc. d/b/a Verizon Business Services, and applicable MCI Legacy Companies (Individually and collectively “Verizon”)”.

60. Special Pricing Attachment Modification. The “Data Center Custom Net Pricing” section of the Special Pricing Attachment to the Agreement is hereby amended by adding the following new Subsection:

8. Cat6 Cable. In lieu of any other rates, discounts or promotions for one (1) Cat6 cable, Customer’s existing cabinets #W.43 and #W.44 for Premium Data Center Service at the 2030 Fortune Drive, San Jose, CA facility, Customer will pay an install fee of [ * ] ($[ * ]).

61. Definitions. All capitalized terms used herein and not expressly defined herein shall have the respective meanings given to such terms in the Agreement.

62. Acceptance Deadline. Pricing and/or promotional benefits in this Sixth Amendment may not be available if it is signed and delivered to Verizon after September 29, 2006. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS WHEREOF, Verizon and Customer have caused this Sixth Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the Sixth Amendment Effective Date.

DANGER, INC.		VERIZON BUSINESS FINANCIAL MANAGEMENT CORP.
By:	/s/ Arnold Magcale	By:	/s/ Suleiman Hessami
Name:	Arnold Magcale	Name:	Suleiman Hessami
Title:	Senior Manager, Service Ops	Title:	VP Pricing/Contract Management
Date:	9/21/08	Date:	10 - 19 - 06

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

SEVENTH AMENDMENT TO THE

MCI SERVICE AGREEMENT

This amendment to the MCI Service Agreement (“Seventh Amendment”) is entered into as of the dates set forth below, by and between Danger, Inc. (“Customer”) and Verizon Business Financial Management Corp., on behalf of MCI Communications Services, Inc. d/b/a Verizon Business Services, and applicable MCI Legacy Companies (individually and collectively “Verizon”). Provided that this Seventh Amendment is executed by Verizon, the rates; charges and discounts contained herein will be effective on the first (1^st ) day of the second (2^nd) billing cycle following Customer’s signature and delivery of this Seventh Amendment to Verizon (“Seventh Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and Verizon entered into the MCI Service Agreement executed by Customer on October 8, 2004 (“Original Agreement”) with respect to certain services to be provided to Customer by Verizon, as more particularly described therein, and as amended by that certain First Amendment executed by Customer on March 28, 2005, as amended by that certain Second Amendment executed by Customer on June 30, 2005, as amended by that certain Third Amendment executed by Customer on June 26, 2006, as amended by that certain Fourth Amendment executed by Customer on October 14, 2005 as amended by that certain Fifth Amendment executed by Customer on August 18, 2006 and as amended by that certain Sixth Amendment executed by Customer on             , 2006 (collectively, the Original Agreement and all amendments shall be referred to as the “Agreement”);

WHEREAS, Customer and Verizon wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

63. Standard Data Center Service. The Pricing Schedule for Standard Data Center Service set forth in Schedule 2 attached hereto is hereby incorporated into the Data Center (US Only) Service Attachment of the Services Attachment to the Agreement.

64. Internet Dedicated Service. A new Section (Internet Dedicated Service) is added to the Other Services section of the Services Attachment to the Agreement as follows:

Internet Dedicated Service. Verizon will provide to Customer Internet Dedicated Service under the terms and conditions set forth in the Agreement and Schedule 3, which is attached hereto and incorporated herein by reference. Internet Dedicated Services monthly recurring and usage charges. after the application of discounts, will contribute to the AVC.

65. Special Pricing Attachment Modification. The “Service Type” and “Discount” table in the Premium Data Center Service (Option 4) section of the Special Pricing Attachment to the Agreement is hereby deleted and replaced as follows:

Service Type	Discount
Space	[	* ]%
Bandwidth and Overage (except for the table below)	[	* ]%
Cross Connect	[	* ]%

Service Type	Discount
Bandwidth and Overage for 1,000 Mbps Burstable Services (Primary Internet Connectivity and Diverse Internet Connectivity) as the following speeds:
50 Mbps	[	* ]%
100 Mbps	[	* ]%
150 Mbps	[	* ]%
200 Mbps	[	* ]%
250 Mbps	[	* ]%
350 Mbps	[	* ]%
500 Mbps	[	* ]%

66. Special Pricing Attachment Modification. The Special Pricing Attachment to the Agreement is hereby amended by adding the following new sections. The new “Standard Data Center Service – Custom Cage Net Pricing” section below will follow the “Data Center Custom Net Pricing” section currently set forth in the Special Pricing Attachment to the Agreement.

Standard Data Center Service – Custom Cage Net Pricing. Verizon will provide Standard Data Center Service to Customer’s Space (as defined in Section II.A.2 of this Service Attachment) at the 500 Stockton, San Jose Data Center, as follows:

(a) Pricing. Provided Customer orders seventy (70) racks together with the four (4) power whips per rack described in subpart 1 of this Section A, during the remaining portion of the Term:

(i) Customer will pay [ * ] $[ * ] per rack for [ * ] racks which will be placed at Customer’s Space located at the [ * ] Data Center. The [ * ] $[ * ] include the [ * ] associated with four (4) 20amp@110 volt non-redundant power whips per rack. As of the Seventh Amendment Effective Date said Space Consists of 1,896 Square fee. The total [ * ] for the [ * ] racks is $[ * ]. The [ * ] racks, including the four (4) 20amp@110 volt non-redundant power whips per rack, and said Space are hereinafter collectively referred to as the “Custom Cage Space.”

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

(ii) Verizon will waive the [ * ] fee of $[ * ] associated with the [ * ] of the Custom Cage Space.

(iii) Verizon will waive the [ * ] of $[ * ] associated with 210 additional power whips that Customer may order in support of Customer’s 4x20amp@120volt power requirements [ * ] each whip).

(b) Conditions of Service.

(i) Customer Cage Term/Early Termination Charges. The Standard Data Center Service – Custom Cage Space described above must remain in service for [ * ] consecutive months following the Seventh Amendment Effective Date (“Custom Cage Term”). If Customer disconnects any rack, cabinet and/or the entire cage prior to the completion of [ * ] months, Customer will pay a termination charge equal to [ * ]. The amount of the [ * ] of the [ * ] that Customer is to pay will be set forth in an Amendment to this Agreement relevant to the Services hereunder shall survive the expiration of the Agreement until the expiration or termination of the Custom Cage Term.

(ii) Customer will provide cable management, as Verizon may require of Customer, for the [ * ] racks.

(iii) Customer will ensure the Equipment will not exceed 80 percent of the electrical load of the circuit breaker rating and shall be responsible for any outage resulting from the Equipment exceeding such level 80 percent load of the circuit breaker rating. Branch circuit monitoring will be employed by Verizon in the Facility to monitor power loads in accordance with the foregoing.

Ethernet Private Line (EPL) – Metro Service (Option 1). In lieu of any other rates, discounts or promotions, and subject to the service term commitment below, for EPL – Metro Service (Option 1) at 1 Gbps between Type 1 – Lit Buildings in San Jose, CA. Customer will pay a [ * ] of [ * ] Dollars ($[ * ]) per circuit. Such rate only applies to circuits which are serviced by MCI Legacy Company-owned facilities. If Customer orders a circuit herein which does not satisfy this condition, then Verizon reserves the right to adjust the rate for such circuit.

(i) EPL-Metro Circuit Term/Early Termination Charges. In order for Customer to receive the EPL – Metro Service (Option 1) Special Pricing described immediately above, the EPL-Metro circuit must remain in service for forty-eight (48) consecutive months (“Circuit Term”). If Customer disconnections the circuit prior to the completion of forty-eight (48) months, Customer will pay a termination charge equal to the [ * ]. The Private Line (Metro) Service Attachment and the terms of the Agreement relevant to the Services hereunder shall survive the expiration of the Agreement until the expiration or termination of the Circuit Term.

67. Definitions. All capitalized terms used herein and not expressly defined herein shall have the respective meanings given to such terms in the Agreement.

68. Acceptance Deadline. Pricing and/or promotional benefits in this Seventh Amendment may not be available if it is signed and delivered to Verizon after September 29, 2006. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS WHEREOF, Verizon and Customer have caused this Seventh Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the Seventh Amendment Effective Date.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2

DANGER, INC.		VERIZON BUSINESS FINANCIAL MANAGEMENT CORP.
By:	/s/ Henry R. Nothhaft	By:	/s/ Suleiman Hessami
Name:	Hank Nothhaft	Name:	Suleiman Hessami
Title:	Chairman and CEO	Title:	Vice President
Date:	September 28, 2006	Date:	October 5, 2006

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

3

Schedule 2

Data Center Colocation – United States

Pricing Schedule for Standard Data Centers

No Install Fees are charged for Renewals unless there is a change in configuration.

Discounts, if any, in any other section of the Agreement to which this Schedule 2 is incorporated, applicable to this particular Service shall be applied to the prices set forth below except for MRCs for Power Options which are not discountable:

I. Equipment Space Options.

Equipment Space	Install Fee			MRC
Telco Cabinet	$	[	* ]	$	[	* ]

II. Power Option. AC Power is not protected by a UPS.

A. Standard Power. (one per Cabinet ordered)

Cabinet Space	Install Fee			MRC
AC Power – 20 amp 120 volt	$	[	* ]	$	[	* ]
DC Power – 30 amp	$	[	* ]	$	[	* ]

B. Option Power Upgrades. Ordered in lieu of Standard Power Option for each Cabinet ordered.

AC Power	Install Fee			MRC
30 amp 120 volt	$	[	* ]	$	[	* ]
DC Power	Install Fee			MRC
35 amp	$	[	* ]	$	[	* ]
40 amp	$	[	* ]	$	[	* ]
45 amp	$	[	* ]	$	[	* ]
50 amp	$	[	* ]	$	[	* ]
55 amp	$	[	* ]	$	[	* ]
60 amp	$	[	* ]	$	[	* ]

C. Supplemental Power Options. Supplemental Power to Standard Power Options or to Power Upgrades.

AC Power	Install Fee			MRC
20 amp 120 volt	$	[	* ]	$	[	* ]
30 amp 120 volt	$	[	* ]	$	[	* ]
DC Power	Install Fee			MRC
30 amp	$	[	* ]	$	[	* ]
35 amp	$	[	* ]	$	[	* ]
40 amp	$	[	* ]	$	[	* ]
45 amp	$	[	* ]	$	[	* ]
50 amp	$	[	* ]	$	[	* ]
55 amp	$	[	* ]	$	[	* ]
60 amp	$	[	* ]	$	[	* ]

IV. Cross Connects.

Cross Connect Cable Tape	[ * ] Charge
Twisted Pair Cable (DS-1)	$	[	* ]
Coax Cable (DS3)	$	[	* ]
Fiber Cable (OCx, Gigabit Ethernet)	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

4

VI. UPS Units. Verizon provides no maintenance for the UPS units or optional hardware listed below. A rack-mounting kit is included with all UPS units listed below.

UPS Units (with rack mountable kit)	NRC
Powerware 5125 Model – 750 VA	$	[	* ]
Powerware 5125 Model – 1440 VA	$	[	* ]
Powerware 5125 Model – 2880 VA	$	[	* ]
Powereware 5125 Model – 5000 VA	$	[	* ]
Optional Hardware
Optional Powerware Connect UPSX – Remote Management adapter – X-Slot EN, Fast En, 10BaseT, 100 BaseTX-4		[	* ]

Note: If Customer is ordering additional Verizon Services that are to be associated with Verizon’s Data Center Colocation, these are to be separately contracted.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

5

Schedule 3

Internet Dedicated Service

Service Attachment

I. Rates and Charges. Customer will pay the monthly recurring Charge (“MRC”), which are fixed for the Term of this agreement, for internet Dedicated Services (includes Integrated Internet Access Service, Internet Dedicated NxT1 Service, Internal Dedicated T1 Service, Internet Dedicates T3 Service, Internet Dedicated OC3 Service, Internet Dedicated OC12 Service, Internet Dedicated OC48 Service, Internet Dedicated GigE Service, Internet Dedicated Ethernet Service and Internet Dedicated Fast Ethernet Service), (“Internet Dedicated Service”) and attendant options are listed, as applicable, in the Pricing Schedule(s) set forth below. Additional charges are also set forth below. Prices below are for Internet Dedicated Service in the contiguous United States. Local access (“local loop”) service is required to connect Customer’s premises to Verizon’s network hub and is sold separately pursuant to the Network Access Services Service Attachment.

A. Integrated Internet Access Service

1. Integrated Internet Access Service. Integrated Internet Access is only available with a Verizon T1 Network Access port that is a carrying one or more additional Verizon Services.

Internet Access Bandwidth	Number of D80 Ports	Start-up Charge			MRC
84 Kbps	1	$	[	* ]	$	[	* ]
128 KBPS	2	$	[	* ]	$	[	* ]
258 Kbps	4	$	[	* ]	$	[	* ]
384 Kbps	6	$	[	* ]	$	[	* ]
512 Kbps	8	$	[	* ]	$	[	* ]
768 Kbps	12	$	[	* ]	$	[	* ]
1024 Kbps	16	$	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

6

B. Internet Dedicated NxT1 Service

1. NxT1 Ports

NxT1 MLFR	Start-up Fee			MRC
2xT1	$	[	* ]	$	[	* ]
3xT1	$	[	* ]	$	[	* ]
4xT1	$	[	* ]	$	[	* ]
5xT1	$	[	* ]	$	[	* ]
5xT1	$	[	* ]	$	[	* ]
6xT1	$	[	* ]	$	[	* ]
7xT1	$	[	* ]	$	[	* ]
Qos Options
Qos for NxT1	$	[	* ]	$	[	* ]

* Pricing for QoS ports does not vary based on speed or the number of ports selected for QoS. A single flat charge applies to all speeds and all of Customer’s selected NxT1 QoS enabled ports.

2. Relocation/Retermination Fee: $[ * ]

C. Internet Dedicated T1 Service

1. T1 Ports

Service Type	Start-up Fee			MRC
0-128 Kbp Burstable T1	$	[	* ]	$	[	* ]
128.01-256 Kbps Burtstable T1	$	[	* ]	$	[	* ]
256.01-384 Kbps Burstable T1	$	[	* ]	$	[	* ]
384.01-512 Kbps Burstable T1	$	[	* ]	$	[	* ]
Over 512 Kbps Burstable T1	$	[	* ]	$	[	* ]
Tiered 768 Kbps	$	[	* ]	$	[	* ]
Price-Protected T1	$	[	* ]	$	[	* ]
Diverse T1	$	[	* ]	$	[	* ]
Double T1	$	[	* ]	$	[	* ]
Shadow T1*	$	[	* ]	$	[	* ]
ISDN Back-up (128 Kbps)**	$	[	* ]	$	[	* ]
QoS Options
QoS for 768 Kbps		[	* ]	$	[	* ]
QoS for Burstable/Tiered/Price Protected T1	$	[	* ]	$	[	* ]
QoS for Double/Diverse T1	$	[	* ]	$	[	* ]
QoS for Shadow T1	$	[	* ]	$	[	* ]

* Shadow Service is only available with an equivalent primary service (e.g., Shadow T1 is available only with T1 Service)

** ISDN lines are not discountable and must be ordered by Customer.

2. Relocation/Retermination Fee: $[ * ]

D. Internet Dedicated T3 Service

1. T3 Ports

T3 Tiered	Start-up Fee			MRC
3 Mbps port	$	[	* ]	$	[	* ]
6 Mbps port	$	[	* ]	$	[	* ]
9 Mbps port	$	[	* ]	$	[	* ]
12 Mbps port	$	[	* ]	$	[	* ]
15 Mbps port	$	[	* ]	$	[	* ]
18 Mbps port	$	[	* ]	$	[	* ]
21 Mbps port	$	[	* ]	$	[	* ]
24 Mbps port	$	[	* ]	$	[	* ]
27 Mbps port	$	[	* ]	$	[	* ]
30 Mbps port	$	[	* ]	$	[	* ]
33 Mbps port	$	[	* ]	$	[	* ]
36 Mbps port	$	[	* ]	$	[	* ]
39 Mbps port	$	[	* ]	$	[	* ]
45 Mbps port	$	[	* ]	$	[	* ]
Shadow T3*	$	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

7

Burstable T3	Start-up Fee			MRC
0-3 Mbps port	$	[	* ]	$	[	* ]
3.01-6 Mbps port	$	[	* ]	$	[	* ]
6.01-7.5 Mbps port	$	[	* ]	$	[	* ]
7.51-9 Mbps port	$	[	* ]	$	[	* ]
9.01-10.5 Mbps port	$	[	* ]	$	[	* ]
10.51-12 Mbps port	$	[	* ]	$	[	* ]
12.01-13.5 Mbps port	$	[	* ]	$	[	* ]
13.51-15 Mbps port	$	[	* ]	$	[	* ]
15.01-16.5 Mbps port	$	[	* ]	$	[	* ]
16.51-18 Mbps port	$	[	* ]	$	[	* ]
18.01-19.5 Mbps port	$	[	* ]	$	[	* ]
19.51-21 Mbps port	$	[	* ]	$	[	* ]
21.01-45 Mbps port	$	[	* ]	$	[	* ]
Shadow T3*	$	[	* ]	$	[	* ]

Burstable Select T3	Start-up Fee			MRC			Overage Per Mbps
5 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
10 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
15 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
20 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
25 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
30 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
35 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
40 mbps	$	[	* ]	$	[	* ]	$	[	* ]

Price Protected T3	Start-up Fee			MRC
Price-Protected T3-45 Mbps	$	[	* ]	$	[	* ]
Shadow T3*	$	[	* ]	$	[	* ]
Double/Diverse T3	Start-up Fee			MRC
Diverse T3	$	[	* ]	$	[	* ]
Double T3	$	[	* ]	$	[	* ]

QoS Options
QoS for Burstable/Burstable Select/Price Protected T3	$	[	* ]	$	[	* ]
QoS for Double/Diverse T3	$	[	* ]	$	[	* ]
QoS for Shadow T3	$	[	* ]	$	[	* ]

* Shadow Service is only available with an equivalent primary Service (e.g., Shadow T3 is available only with T3 Service).

** Pricing for QoS ports does not vary based on speed or the number of ports selected for QoS. A single flat charge applies to all speeds and all of Customer’s selected QoS enabled ports.

2. Relocation/Retermination Fee: $[ * ]

E. Internet Dedicated OC3 Service Pricing Schedule

1. OC3 Ports

Tiered OC3	Start-up Fee			MRC
60 Mbps port	$	[	* ]	$	[	* ]
70 Mbps port	$	[	* ]	$	[	* ]
80 Mbps port	$	[	* ]	$	[	* ]
90 Mbps port	$	[	* ]	$	[	* ]
100 Mbps port	$	[	* ]	$	[	* ]
155 Mbps port	$	[	* ]	$	[	* ]
Shadow OC3*	$	[	* ]	$	[	* ]
Burstable OC3	Start-up Fee			MRC
0-45 Mbps	$	[	* ]	$	[	* ]
45.01-60 Mbps	$	[	* ]	$	[	* ]
60.01-70 Mbps	$	[	* ]	$	[	* ]
70.01-80Mbps	$	[	* ]	$	[	* ]
80.01-90 Mbps	$	[	* ]	$	[	* ]
90.01-100 Mbps	$	[	* ]	$	[	* ]
100.01-155 Mbps	$	[	* ]	$	[	* ]
Shadow OC3*	$	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

8

Burstable Select OC3	Start-up Fee			MRC			Overage Per Mbps
30 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
40 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
50 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
60 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
80 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
120 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
135 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

Price Protected OC3	Start-up Fee			MRC
Price-Protected OC3	$	[	* ]	$	[	* ]
Shadow OC3*	$	[	* ]	$	[	* ]
Double/Diverse T3	Start-up Fee			MRC
Diverse OC3	$	[	* ]	$	[	* ]
Double OC3	$	[	* ]	$	[	* ]

* Shadow Service is only available with an equivalent primary Service (e.g., Shadow OC3 is available only with OC3 Service).

2. Relocation/Retermination Fee: $[ * ]

F. Internet Dedicated OC12 Service

1. OC12 Ports

Tiered OC12	Start-up Fee			MRC
150 Mbps port	$	[	* ]	$	[	* ]
160 Mbps port	$	[	* ]	$	[	* ]
180 Mbps port	$	[	* ]	$	[	* ]
200 Mbps port	$	[	* ]	$	[	* ]
250 Mbps port	$	[	* ]	$	[	* ]
300 Mbps port	$	[	* ]	$	[	* ]
350 Mbps port	$	[	* ]	$	[	* ]
622 Mbps port	$	[	* ]	$	[	* ]
Shadow OC12*	$	[	* ]	$	[	* ]
Burstable OC12	Start-up Fee			MRC
0-150 Mbps	$	[	* ]	$	[	* ]
150.01-200 Mbps	$	[	* ]	$	[	* ]
200.01-250 Mbps	$	[	* ]	$	[	* ]
250.01-300 Mbps	$	[	* ]	$	[	* ]
300.01-350 Mbps	$	[	* ]	$	[	* ]
350.01-400 Mbps	$	[	* ]	$	[	* ]
400.01-450 Mbps	$	[	* ]	$	[	* ]
450.01-500 Mbps	$	[	* ]	$	[	* ]
500.01-550 Mbps	$	[	* ]	$	[	* ]
550.01-622 Mbps	$	[	* ]	$	[	* ]
Shadow OC12*	$	[	* ]	$	[	* ]

Burstable Select OC12	Start-up Fee			MRC			Overage Per Mbps
50 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
75 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
150 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
200 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
250 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
300 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
400 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

Price Protected OC12	Start-up Fee			MRC
Price-Protected OC12	$	[	* ]	$	[	* ]
Shadow OC12*	$	[	* ]	$	[	* ]
Double/Diverse OC12	Start-up Fee			MRC
Diverse OC12	$	[	* ]	$	[	* ]
Double OC12	$	[	* ]	$	[	* ]

* Shadow Service is only available with an equivalent primary Service (e.g., Shadow OC12 is available only with OC12 Service).

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

9

2. Relocation/Retermination Fee: $[ * ]

G. Internet Dedicated OC48 Service

1. OC48 Ports. Hawaii and Puerto Rico are not included in U.S. pricing for this product. OC-48 is not available in these locations.

Tiered OC48	Start-up Fee			MRC
400 Mbps	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]
600 Mbps	$	[	* ]	$	[	* ]
750 Mbps	$	[	* ]	$	[	* ]
1000 Mbps	$	[	* ]	$	[	* ]
1250 Mbps	$	[	* ]	$	[	* ]
1500 Mbps	$	[	* ]	$	[	* ]
1750 Mbps	$	[	* ]	$	[	* ]
2000 Mbps	$	[	* ]	$	[	* ]
2250 Mbps	$	[	* ]	$	[	* ]
2488 Mbps	$	[	* ]	$	[	* ]
Burstable OC48	Start-up Fee			MRC
0-500 Mbps	$	[	* ]	$	[	* ]
501-750 Mbps	$	[	* ]	$	[	* ]
751-1,000 Mbps	$	[	* ]	$	[	* ]
1,001-1,250 Mbps	$	[	* ]	$	[	* ]
1,251-1,500 Mbps	$	[	* ]	$	[	* ]
1,501-1,750 Mbps	$	[	* ]	$	[	* ]
1,751-2,000 Mbps	$	[	* ]	$	[	* ]
2,001-2,250 Mbps	$	[	* ]	$	[	* ]
2,251-2,488 Mbps	$	[	* ]	$	[	* ]

Burstable Select OC48	Start-up Fee			MRC			Overage Per Mbps
200 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
300 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
400 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
600 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
750 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
1000 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
1250 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
1500 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
1750 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
2000 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

Price Protected OC48	Start-up Fee			MRC
Price-Protected	$	[	* ]	$	[	* ]
Shadow	$	[	* ]	$	[	* ]
Double/Diverse OC48	Start-up Fee			MRC
Double/Diverse	$	[	* ]	$	[	* ]

* Shadow Service is only available with an equivalent primary Service (e.g., Shadow OC48 is available only with OC48 Service).

2. Relocation/Retermination Fee: $[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

10

H. Internet Dedicated GigE Service

1. GigE Bandwidth

Burstable GigE	Start-up Fee			MRC
0 – 100 Mbps	$	[	* ]	$	[	* ]
100.01 – 150 Mbps	$	[	* ]	$	[	* ]
150.01 – 200 Mbps	$	[	* ]	$	[	* ]
200.01 – 250 Mbps	$	[	* ]	$	[	* ]
250.01 – 300 Mbps	$	[	* ]	$	[	* ]
300.01 – 350 Mbps	$	[	* ]	$	[	* ]
350.01 – 400 Mbps	$	[	* ]	$	[	* ]
400.01 – 450 Mbps	$	[	* ]	$	[	* ]
450.01 – 500 Mbps	$	[	* ]	$	[	* ]
500.01 – 550 Mbps	$	[	* ]	$	[	* ]
550.01 – 600 Mbps	$	[	* ]	$	[	* ]
600.01 – 650 Mbps	$	[	* ]	$	[	* ]
650.01 – 700 Mbps	$	[	* ]	$	[	* ]
700.01 – 750 Mbps	$	[	* ]	$	[	* ]
750.01 – 800 Mbps	$	[	* ]	$	[	* ]
800.01 – 850 Mbps	$	[	* ]	$	[	* ]
850.01 – 900 Mbps	$	[	* ]	$	[	* ]
900.01 – 950 Mbps	$	[	* ]	$	[	* ]
950.01 – 1000 Mbps	$	[	* ]	$	[	* ]
Shadow GigE*	$	[	* ]	$	[	* ]

Burstable Select GigE	Start-up Fee			MRC			Overage Per Mbps
75 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
150 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
200 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
250 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
300 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
400 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
600 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
750 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

Price Protected GigE	Start-up Fee			MRC
Price-Protected GigE	$	[	* ]	$	[	* ]
Shadow GigE*	$	[	* ]	$	[	* ]
Double/Diverse GigE	Start-up Fee			MRC
Diverse GigE	$	[	* ]	$	[	* ]
Double GigE	$	[	* ]	$	[	* ]
Shadow GigE*	$	[	* ]	$	[	* ]

* Shadow Service is only available with an equivalent primary GigE Service.

2. Relocation/Retermination Fee: $1,000

I. Internet Dedicated Ethernet Service

1. Internet Dedicated Ethernet Bandwidth

Tiered	Start-up Fee			MRC
1 Mbps	$	[	* ]	$	[	* ]
2 Mbps	$	[	* ]	$	[	* ]
3 Mbps	$	[	* ]	$	[	* ]
4 Mbps	$	[	* ]	$	[	* ]
5 Mbps	$	[	* ]	$	[	* ]
6 Mbps	$	[	* ]	$	[	* ]
7 Mbps	$	[	* ]	$	[	* ]
8 Mbps	$	[	* ]	$	[	* ]
9 Mbps	$	[	* ]	$	[	* ]
10 Mbps	$	[	* ]	$	[	* ]
15 Mbps	$	[	* ]	$	[	* ]
20 Mbps	$	[	* ]	$	[	* ]
25 Mbps	$	[	* ]	$	[	* ]
30 Mbps	$	[	* ]	$	[	* ]
35 Mbps	$	[	* ]	$	[	* ]
40 Mbps	$	[	* ]	$	[	* ]
50 Mbps	$	[	* ]	$	[	* ]
60 Mbps	$	[	* ]	$	[	* ]
70 Mbps	$	[	* ]	$	[	* ]
80 Mbps	$	[	* ]	$	[	* ]
90 Mbps	$	[	* ]	$	[	* ]
100 Mbps	$	[	* ]	$	[	* ]
150 Mbps	$	[	* ]	$	[	* ]
200 Mbps	$	[	* ]	$	[	* ]
250 Mbps	$	[	* ]	$	[	* ]
300 Mbps	$	[	* ]	$	[	* ]
350 Mbps	$	[	* ]	$	[	* ]
400 Mbps	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]
600 Mbps	$	[	* ]	$	[	* ]
700 Mbps	$	[	* ]	$	[	* ]
800 Mbps	$	[	* ]	$	[	* ]
1,000 Mbps	$	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

11

Burstable 10 Mbps	Start-up Fee			MRC
0-1 Mbps	$	[	* ]	$	[	* ]
1.01-2 Mbps	$	[	* ]	$	[	* ]
2.01-3 Mbps	$	[	* ]	$	[	* ]
3.01-4 Mbps	$	[	* ]	$	[	* ]
4.01-5 Mbps	$	[	* ]	$	[	* ]
5.01-6 Mbps	$	[	* ]	$	[	* ]
6.01-7 Mbps	$	[	* ]	$	[	* ]
7.01-8 Mbps	$	[	* ]	$	[	* ]
8.01-9 Mbps	$	[	* ]	$	[	* ]
9.01-10 Mbps	$	[	* ]	$	[	* ]

Burstable Select 10 Mbps	Start-up Fee			MRC			Overage Per Mbps
2 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
4 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
6 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
8 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

Burstable 50 Mbps	Start-up Fee			MRC
0-5 Mbps	$	[	* ]	$	[	* ]
5.01-10 Mbps	$	[	* ]	$	[	* ]
10.01-15 Mbps	$	[	* ]	$	[	* ]
15.01-20 Mbps	$	[	* ]	$	[	* ]
20.01-25 Mbps	$	[	* ]	$	[	* ]
25.01-30 Mbps	$	[	* ]	$	[	* ]
30.01-35 Mbps	$	[	* ]	$	[	* ]
35.01-40 Mbps	$	[	* ]	$	[	* ]
40.01-45 Mbps	$	[	* ]	$	[	* ]
45.01-50 Mbps	$	[	* ]	$	[	* ]

Burstable Select 50 Mbps	Start-up Fee			MRC			Overage Per Mbps
5 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
10 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
15 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
20 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
25 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
30 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
35 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
40 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

Burstable 100 Mbps	Start-up Fee			MRC
0-20 Mbps	$	[	* ]	$	[	* ]
20.01-30 Mbps	$	[	* ]	$	[	* ]
30.01-40 Mbps	$	[	* ]	$	[	* ]
40.01-50 Mbps	$	[	* ]	$	[	* ]
50.01-60 Mbps	$	[	* ]	$	[	* ]
60.01-70 Mbps	$	[	* ]	$	[	* ]
70.01-80 Mbps	$	[	* ]	$	[	* ]
80.01-90 Mbps	$	[	* ]	$	[	* ]
90.01-100 Mbps	$	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

12

Burstable Select 100 Mbps	Start-up Fee			MRC			Overage Per Mbps
10 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
20 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
30 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
40 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
50 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
60 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
70 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
80 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

Burstable 600 Mbps	Start-up Fee			MRC
0-50 Mbps	$	[	* ]	$	[	* ]
50.01-100 Mbps	$	[	* ]	$	[	* ]
100.01-150 Mbps	$	[	* ]	$	[	* ]
150.01-200 Mbps	$	[	* ]	$	[	* ]
200.01-250 Mbps	$	[	* ]	$	[	* ]
250.01-300 Mbps	$	[	* ]	$	[	* ]
300.01-350 Mbps	$	[	* ]	$	[	* ]
350.01-400 Mbps	$	[	* ]	$	[	* ]
400.01-500 Mbps	$	[	* ]	$	[	* ]
500.01-600 Mbps	$	[	* ]	$	[	* ]

Burstable Select 600 Mbps	Start-up Fee			MRC			Overage Per Mbps
50 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
150 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
200 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
250 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
300 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
350 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
400 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
Burstable Select 1,000 Mbps	Start-up Fee			MRC			Overage Per Mbps
75 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
100 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
150 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
200 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
250 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
300 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
400 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
500 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
600 Mbps	$	[	* ]	$	[	* ]	$	[	* ]
750 Mbps	$	[	* ]	$	[	* ]	$	[	* ]

2. Relocation/Retermination Fee: $[ * ]

J. Internet Dedicated Fast Ethernet Service

1. Internet Dedicated Fast Ethernet (“FE”) Bandwidth

Burstable Select Bandwidth	Start-up Charge			MRC			Per Mbps Overage
FE Port Only Burst Select 1M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 2M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 4M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 6M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 8M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 10M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 20M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 30M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 40M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 50M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 60M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 70M	$	[	* ]	$	[	* ]	$	[	* ]
FE Port Only Burst Select 80M	$	[	* ]	$	[	* ]	$	[	* ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

13

Tiered	Start-up Charge			MRC
FE Port Only Tiered 1M	$	[	* ]	$	[	* ]
FE Port Only Tiered 2M	$	[	* ]	$	[	* ]
FE Port Only Tiered 5M	$	[	* ]	$	[	* ]
FE Port Only Tiered 10M	$	[	* ]	$	[	* ]
FE Port Only Tiered 15M	$	[	* ]	$	[	* ]
FE Port Only Tiered 20M	$	[	* ]	$	[	* ]
FE Port Only Tiered 25M	$	[	* ]	$	[	* ]
FE Port Only Tiered 30M	$	[	* ]	$	[	* ]
FE Port Only Tiered 35M	$	[	* ]	$	[	* ]
FE Port Only Tiered 40M	$	[	* ]	$	[	* ]
FE Port Only Tiered 45M	$	[	* ]	$	[	* ]
FE Port Only Tiered 50M	$	[	* ]	$	[	* ]
FE Port Only Tiered 60M	$	[	* ]	$	[	* ]
FE Port Only Tiered 70M	$	[	* ]	$	[	* ]
FE Port Only Tiered 80M	$	[	* ]	$	[	* ]
FE Port Only Tiered 90M	$	[	* ]	$	[	* ]
FE Port Only Tiered 100M	$	[	* ]	$	[	* ]

K. Internet Dedicated Service Installation. Internet Dedicated Service installation may be scheduled between the hours of 8AM and 7PM ET Monday through Friday (excluding holidays). If Customer requires Internet Dedicated Service Installation outside of these hours, Verizon will charge an additional $500 fee.

L. Access Charges. Access (“local loop”) circuit charges are separately priced and may be found in the Access portion of the Guide. If Customer orders its own local loop circuits, Verizon’s Network Connection Charge – also set forth in the Guide – shall apply.

M. Expedited Service Fee. At Customer’s request, Verizon will provide expedited service. Customer shall pay an expedited service fee of $[ * ] per port for all expedited port provisioning. Additional expedited services fees may apply for network access services and Verizon will notify Customer in writing of any such fees prior to performing any Services.

N. Cancellation Prior to Installation. A $[ * ] per-order charge applies to orders for installation of Internet Dedicated Service which are cancelled by the Customer after submission to Verizon and prior to Installation of Internet Dedicated Service.

II. Special Pricing.

A. Internet Dedicated Burstable Select GigE Service. In lieu of all other discounts and promotions, including those set forth herein, Customer will receive the following fixed discounts off the monthly recurring charges and overage per Mbps set forth herein for Internet Dedicated Burstable Select GigE Service, based on the service types set forth below. Access is not eligible for these discounts and is additional.

Internet Dedicated Burstable Select GigE Service Type	Discount off MRC and Overage Per Mbps
75 Mbps	[	* ]%
100 Mbps	[	* ]%
150 Mbps	[	* ]%
200 Mbps	[	* ]%
250 Mbps	[	* ]%
300 Mbps	[	* ]%
400 Mbps	[	* ]%
500 Mbps	[	* ]%
600 Mbps	[	* ]%
750 Mbps	[	* ]%

III. Terms and Conditions.

A. The Internet Dedicated Services (“Internet Dedicated Service(s)”) provided pursuant to this Attachment are governed by the Guide provisions relating to Internet Dedicated Service, as supplemented by this Attachment and the related Agreement. Pricing for ATM-to-IP, Frame-to-IP, and Integrated Internet Access (collectively, “Internet Service Options”) are also included, as applicable, in the Pricing Schedule attached hereto.

B. Minimum Term Commitment. The minimum Service Term for Verizon Internet Dedicated OC-3, OC-12, OC-48 and Ethernet Service and GigE, is one year. If the termination of the Agreement causes a Service Attachment, with any of the aforementioned Services to terminate prior to the expiration of a minimum one-year Service Term, Customer shall be liable for the Early Termination Charges, defined below.

C. Access. Access to a router at an Verizon Network hub near Customer’s site may be interrupted for (i) scheduled maintenance (usually scheduled during off-hours at an Verizon hub, such as Tuesdays and Thursdays between 3:00 AM and 6:00 AM local time), (ii) emergency maintenance, or (iii) as otherwise set forth in the Agreement.

D. Verizon Internet Dedicated GigE Services. Verizon’s Internet Dedicated GigE Service is an intra-building connectivity product, and thus the Customer’s demarcation point must reside within the same building as a GigE-qualified Verizon-owned network hub. To ensure proper installation, Verizon will order all telco lines within the telco facility where the Verizon hub is located.

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

14

E. Customer Obligations – Service Not To Be Resold. While Customer can resell Internet connectivity, Customer cannot resell the Internet Dedicated Service in its entirety to another person or entity without the express prior written consent of Verizon. If Customer resells Internet Connectivity to end users, Customer is responsible for: (i) providing the first point of contact for end user support inquiries; (ii) providing software fulfillment to end users; (iii) running its own primary and secondary domain name service DNS for end users; (iv) registering end users’ domain names; (v) using BGP routing to the Verizon Network, if requested by Verizon; (vi) collecting route additions and changes, and providing them to Verizon; and (vii) registering with the appropriate agency all IP addresses provided by Verizon to Customer that are allocated to end users.

F. Burstable Downgrade. Customer may downgrade to a lower Burstable Service level if Customer’s Measured Use Level is at or below such Burstable Service lever for at least two consecutive months and Customer thereafter requests the downgrade in writing.

G. Burstable Select Upgrades/Downgrades. Customer may charge (upgrade or downgrade) its Burstable Select Service Level once within a given Calendar month, by requesting the same in writing. The new Service Level and applicable charges will take effect on the first day after the end of the billing cycle during which the written request is received.

H. Term/Early Termination. The “Service Activation Date” for an Internet Dedicated Service ordered hereunder will be the date the Internet Dedicated Service is available to route IP packets at Customer’s site. The term of any Internet Dedicated Service ordered hereunder shall commence upon the Service Activation Date and will automatically renew, expire and terminate according to the terms of the Agreement. Notwithstanding the above, the minimum Service Term for Internet Dedicated OC-3, OC-12, OC-48, Ethernet, Fast Ethernet and/or GigE Service is one year, and if the Agreement terminates or expires prior to the termination of this Service Attachment, this Service Attachment with respect to Internet Dedicated OC-3, OC-12, OC-48, Ethernet, Fast Ethernet and/or GigE Service shall continue in full force and effect under the terms and conditions of the Agreement for the longer of the minimum Service Term or the Service Term otherwise agreed to by Customer. If Customer terminates Internet Dedicated OC-3, OC-12, OC-48, Ethernet, Fast Ethernet and/or GigE Service before the end of the one-year minimum Service Term (or longer committed Service Term) for reasons other than Customer’s termination for Cause, Customer will pay an amount equal to [ * ] multiplied by the [ * ] (“Internet Dedicated Early Termination Charges”).

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

15

EIGHTH AMENDMENT TO THE

VERIZON SERVICE AGREEMENT

This amendment to the Verizon Service Agreement (“Eighth Amendment”) is entered into as of the dates set forth below, by and between Danger, Inc. (“Customer”) and Verizon Business Financial Management Corporation or Verizon Business Network Services, Inc., as applicable, on behalf of MCI Communications Services, Inc. d/b/a Verizon Business Services, and applicable MCI Legacy Companies (individually and collectively “Verizon”). Provided that this Eighth Amendment is executed by Verizon, the rates, charges and discounts contained herein shall be effective on the first (1^st) day of the second (2^nd) billing cycle following Customer’s signature and delivery of this Eighth Amendment to Verizon (“Eighth Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and Verizon entered into the Verizon Global Services Agreement executed by Verizon on October 8, 2004 (“Original Agreement”) with respect to certain services to be provided to Customer by Verizon, as more particularly described therein, as amended by that certain First Amendment, executed by Customer on March 28, 2005, by that certain Second Amendment, executed by Customer on June 30, 2005, by that certain Third Amendment, executed by Customer on June 26, 2005, by that certain Fourth Amendment, executed by Customer on October 14, 2005, by that certain Fifth Amendment, executed by Customer on August 18, 2006, by that certain Sixth Amendment, executed by Customer on September 21, 2006 and by that certain Seventh Amendment, executed by Customer on September 28, 2006 (collectively, the Original Agreement and all amendments shall be referred to as the “Agreement”);

WHEREAS, Customer and Verizon wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

69. Special Pricing Attachment. The “Data Center Net Customized Net Pricing” section of the Special Pricing Attachment to the Agreement is hereby amended by adding the following new sections thereto.

7. Cable Ladder Install. In lieu of any other rates or discounts, Customer will pay a non recurring charge of $[ * ] for the cable ladder install described below:

Facility: [ * ]. Verizon will install 12” cable ladder run across each of the following rows: 25.x, 26.x, 27.x, 28.x, and 29.x and in row 30.x an 18” cable ladder should run across this lineup and an 18” cable ladder run perpendicular to the rows along columns x.14, x.17, x.18, and x.21 to create cross aisle paths.

70. Definitions: All capitalized terms used herein and not expressly defined herein shall have the respective meanings given to such terms in the Agreement.

71. Acceptance Deadline: Pricing and/or promotional benefits in this Eighth Amendment may not be available if it is signed and delivered to Verizon after December 29, 2006. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS HEREOF, Verizon and Customer have caused this Eighth Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the Eighth Amendment Effective Date.

Danger, Inc.		Verizon Business Financial Management Corporation or Verizon Business Network Services, Inc., as applicable
By:	/s/ Henry R. Nothhaft	By:	/s/ Suleiman Hessami
Name:	Hank Nothhaft	Name:	Suleiman Hessami
Title:	Chairman, CEO and COB	Title:	Vice President, Pricing and Contract Management
Date:	1/2/07	Date:	1/2/07

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

DANGER INC.

PURCHASE REQUISITION FORM

[ * ]

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

NINTH AMENDMENT TO THE

MCI SERVICE AGREEMENT

This amendment to the MCI Service Agreement (“Ninth Amendment”) is entered into as of the dates set forth below, by and between Danger, Inc. (“Customer”) and Verizon Business Network Services, Inc. on behalf of MCI Communications Services, Inc. d/b/a Verizon Business Services, and applicable MCI Legacy Companies (individually and collectively “Verizon”). Provided that this Ninth Amendment is executed by Verizon, the rates, charges and discounts contained herein will be effective on the first (1^st) day of the second (2^nd) billing cycle flowing Customer’s signature and delivery of this Ninth Amendment to Verizon (“Ninth Amendment Effective Date”).

WITNESSETH:

WHEREAS, Customer and Verizon entered into the MCI Service Agreement executed by Customer on October 8, 2004 (“Original Agreement”) with respect to certain services to be provided to Customer by Verizon, as more particularly described therein, and as amended by that certain First Amendment executed by Customer on March 28, 2006, as amended by that certain Second Amendment executed by Customer on June 30, 2005, as amended by that certain Third Amendment executed by Customer on June 28, 2006, as amended by that certain Fourth Amendment executed by Customer on October 14, 2005, as amended by that certain Fifth Amendment executed by Customer on August 18, 2006, as amended by that certain Sixth Amendment executed by Customer on September 21, 2006, as amended by that certain Seventh Amendment executed by Customer on September 28, 2006, and as amended by that certain Eighth Amendment executed by Customer on January 10, 2007 (collectively, the Original Agreement and all amendments shall be referred to as the “Agreement”);

WHEREAS, Customer and Verizon wish to amend the Agreement to reflect certain changes.

NOW, THEREFORE, in consideration of the premises, the terms and conditions stated herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

72. Internet Dedicated Service. Section II (“Special Pricing”) of Schedule 3 (“Internet Dedicated Service Attachment”), added to the Agreement in the Seventh Amendment, to the Agreement is amended as follows:

(a) Subsection A is deleted and restated as follows:

A. Internet Dedicated Burstable Select GigE Service and Internet Dedicated Burstable Select GigE Service (Port Only). In lieu of all other discounts and promotions, including those set forth herein, Customer will receive the following fixed discounts off the monthly recurring charges and overage per Mbps set forth herein for Internet Dedicated Burstable Select GigE Service and Internet Dedicated Burstable Select GigE Service (Port Only), based on the service types set forth below. Access is not eligible for these discounts and is additional.

Internet Dedicated Burstable Select GigE Service Type	Discount off MRC and Overage Per Mbps
75 Mbps	[	* ]%
100 Mbps	[	* ]%
150 Mbps	[	* ]%
200 Mbps	[	* ]%
250 Mbps	[	* ]%
300 Mbps	[	* ]%
400 Mbps	[	* ]%
500 Mbps	[	* ]%
600 Mbps	[	* ]%
750 Mbps	[	* ]%

Internet Dedicated Burstable Select GigE Service (Port Only) Type	Discount off MRC and Overage Per Mbps
75 Mbps	[	* ]%
100 Mbps	[	* ]%
150 Mbps	[	* ]%
200 Mbps	[	* ]%
250 Mbps	[	* ]%
300 Mbps	[	* ]%
400 Mbps	[	* ]%
500 Mbps	[	* ]%
600 Mbps	[	* ]%
750 Mbps	[	* ]%

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

1

(b) The following new section is added:

B. Internet Dedicated GigE Service; Shadow GigE. In lieu of all other rates, discounts and promotions, including those set forth herein, Customer will pay the monthly recurring charge set forth below less a [ * ] percent ([ * ]%) discount for Internet Dedicated GigE Service-Shadow GigE only. This discount does not apply to charges for Access Service.

Internet Dedicated Service Type	MRC
Shadow GigE	$	[	* ]

73. Data Center Service. The “Data Center Custom Net Pricing” section of the Special Pricing Attachment to the Agreement is hereby amended by adding the following new Subsection:

8. Cat6 Cable. In lieu of any other rates, discounts or promotions for one (1) Cat6 cable, Customer will pay an installation fee of [ * ] Dollars ($[ * ]).

74. Definitions. All capitalized terms used herein and not expressly defined herein shall have the respective meanings given to such terms in the Agreement.

75. Acceptance Deadline. Pricing and/or promotional benefits in this Ninth Amendment may not be available if it is signed and delivered to Verizon after February 28, 2007. Any and all prior offers made to Customer, whether oral or written, shall be superseded by this offer.

IN WITNESS WHEREOF, Verizon and Customer have caused this Ninth Amendment to be duly executed by their authorized representatives as of the dates set forth below, effective as of the Ninth Amendment Effective Date.

DANGER, INC.		VERIZON BUSINESS NETWORK SERVICES, INC.
By:	/s/ Henry R. Nothhaft	By:	/s/ Suleiman Hessami
Name:	Henry R. Nothhaft	Name:	Suleiman Hessami
Title:	Chairman and CEO	Title:	VP Pricing/Contract Management
Date:	2/23/07	Date:	2 - 28 - 07

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.

2

EX-10.28

Exhibit 10.28

Turn Key Datacenter Lease for Premises

In a Multi-Tenant Datacenter

120 EAST VAN BUREN STREET

TURN KEY DATACENTER LEASE

Between

DIGITAL PHOENIX VAN BUREN, LLC

as Landlord

and

DANGER INC.

as Tenant

Dated

10/25/, 2007

TABLE OF CONTENTS

			Page
1.	LEASE OF PREMISES		1
	1.1	Tenant Space	1
	1.2	Condition of Tenant Space	1
	1.3	Datacenter Connection Area	1
	1.4	Intentionally Deleted	1
	1.5	Quiet Enjoyment; Access	1
2.	TERM		1
	2.1	Term	1
	2.2	Delivery of Tenant Space	1
	2.3	Extension Option	2
3.	BASE RENT AND OTHER CHARGES		3
	3.1	Base Rent	3
	3.2	Installation Fee/Other Charges	3
	3.3	Payments Generally	3
	3.4	Late Payments	4
	3.5	Electrical Power	4
4.	TAX ON TENANT’S EQUIPMENT; OTHER TAXES		5
	4.1	Equipment Taxes	5
	4.2	Additional Taxes	5
5.	SECURITY DEPOSIT; LETTER OF CREDIT		6
6.	USE		6
	6.1	Permitted Use	6
	6.2	Datacenter Rules and Regulations	6
	6.3	Compliance with Laws; Hazardous Materials	6
	6.4	Electricity Consumption Threshold	8
	6.5	Structural Load	8
7.	SERVICES TO BE PROVIDED TO THE TENANT SPACE		8
	7.1	Access Control	8
	7.2	Electricity; HVAC	8
	7.3	Interruption of Services	9
8.	MAINTENANCE; ALTERATIONS		10
	8.1	Landlord Maintenance	10
	8.2	Tenant’s Maintenance	10
	8.3	Alterations	11
	8.4	Removal of Cable, Wiring, Connecting Lines, Equipment and Personal Property	11

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TABLE OF CONTENTS

(continued)

			Page
9.	CASUALTY; EMINENT DOMAIN; INSURANCE		11
	9.1	Casualty; Eminent Domain	12
	9.2	Tenant’s Insurance	12
10.	ASSIGNMENT AND SUBLETTING		13
	10.1	Restrictions on Transfers; Landlord’s Consent	13
	10.2	Notice to Landlord	14
	10.3	Landlord’s Recapture Rights	14
	10.4	No Release; Subsequent Transfers	14
	10.5	Colocation	15
11.	ESTOPPEL CERTIFICATE BY TENANT		15
12.	SUBORDINATION AND ATTORNMENT; LENDER RIGHTS		15
	12.1	Subordination and Attornment	16
	12.2	Mortgagee and Ground Lessor Protection	16
	12.3	SNDA	16
13.	SURRENDER OF TENANT SPACE; HOLDING OVER		16
	13.1	Tenant’s Method of Surrender	16
	13.2	Disposal of Tenant’s Personal Property	17
	13.3	Holding Over	17
	13.4	Survival	17
14.	WAIVER OF CLAIMS; INDEMNITY		17
	14.1	Waiver	17
	14.2	Indemnification	18
	14.3	Consequential Damages	18
	14.4	Liens	18
	14.5	Waiver of Landlord’s Lien	19
15.	TENANT DEFAULT		19
	15.1	Events of Default By Tenant	19
	15.2	Remedies	19
16.	LIMITATION OF LANDLORD’S LIABILITY		19
	16.1	Landlord Default	20
	16.2	Landlord’s Liability	20
	16.3	Transfer of Landlord’s Interest	20
17.	MISCELLANEOUS		20
	17.1	Severability	21

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TABLE OF CONTENTS

(continued)

		Page
17.2	Performance	21
17.3	Attorney’s Fees and Costs	21
17.4	Waiver of Right to Jury Trial	21
17.5	Headings; Time; Survival	21
17.6	Notices	21
17.7	Governing Law; No Counterclaims; Jurisdiction	22
17.8	Incorporation; Amendment; Merger	22
17.9	Brokers	22
17.10	Examination of Lease	22
17.11	Recordation	22
17.12	Authority	22
17.13	Successors and Assigns	23
17.14	Force Majeure	23
17.15	No Partnership or Joint Venture; No Third Party Beneficiaries	23
17.16	Access By Landlord	23
17.17	Rights Reserved by Landlord	23
17.18	Counterparts; Execution by Facsimile	24
17.19	Confidentiality	24
17.20	Incorporation of Exhibits	24

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120 EAST VAN BUREN STREET

TURN KEY DATACENTER LEASE

This Turn Key Datacenter Lease (this “Lease”) is entered into as of the date specified in Item 4 of the Basic Lease Information (the “Effective Date”), by and between Landlord (defined in Item 1 of the Basic Lease Information, below) and Tenant (defined in Item 2 of the Basic Lease Information, below):

RECITALS

A. Landlord is the owner of the Land (defined in Item 20 of the Basic Lease Information, below). The Land is improved with, among other things, the Building (defined in Item 21 of the Basic Lease Information, below). The Land, the Building, and Landlord’s personal property thereon or therein may be referred to herein as the “Property.”

B. Tenant desires to lease (i) a portion of the space in the Building’s Datacenter (defined in Item 22 of the Basic Lease Information, below) and (ii) that certain Pathway (defined in Section 1.1 of the Standard Lease Provisions, below) between the Datacenter and the Meet-Me Room (defined in Item 23 of the Basic Lease Information, below), for the purpose of connection to other communications networks during the Term (as defined in Section 2.1 of the Standard Lease Provisions, below).

NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth, Landlord and Tenant agree as follows:

BASIC LEASE INFORMATION

1.      Landlord:	Digital Phoenix Van Buren, LLC, a Delaware limited liability company (“Landlord”)
2.      Tenant:	DANGER Inc., a Delaware corporation (“Tenant”) Tenant represents that it has been validly formed or incorporated under the laws of the State of Delaware.
3.      Tenant Addresses:	Tenant Address for Notices: Danger, Inc. 3101 Park Boulevard Palo Alto, California 94306 Attn: Manager, Network Operations Contact Name: Network Operations Center Phone No: (650) 289-1602 Facsimile No: (650) 493-0500 E-mail: noc@danger.com Tenant Address for Invoice of Rent: Danger, Inc. 3101 Park Boulevard Palo Alto, California 94306 Contact Name: Accounts Payable Phone No: (650) 289-5000 Facsimile: (650) 289-5001 E-mail: AP@danger.com

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4.      Effective Date/          Commencement Date:
Effective Date:          (Sign Date)	10 25, 2007 (being the latest date of the parties’ execution dates, as set forth on the signature page of this Lease)
Commencement Date:          (Lease Start)	The “Commencement Date” shall be the date on which all of the following events (“Commencement Date Conditions”) have occurred: (1) Landlord has performed its site commissioning/turn up of the Premises (the “Site Commissioning/Turn-Up”) pursuant to the commissioning criteria (“Commissioning Criteria”) set forth on Exhibit “E-1”, so that the Premises have passed Level 5 Commissioning, i.e., have been constructed and can perform as designed; and (2) Landlord has delivered possession of the Tenant Space (defined below) to Tenant with the installations set forth on Exhibit “E”, attached hereto, having been completed (such installations, collectively, “Landlord’s Installations”) (the occurrence of the foregoing events, collectively, being referred to as “Substantial Completion”). Upon Landlord’s completion of the Commencement Date Conditions, Landlord shall deliver a notice to Tenant (the “Commencement Date Notice”) memorializing Landlord’s delivery of the Tenant Space to Tenant and confirming the Commencement Date. Landlord agrees to use commercially reasonable efforts to cause the Commencement Date to occur by November 1, 2007 (the “Target Commencement Date”).
5.      Term:	Approximately 48 months (commencing on the Commencement date and expiring forty-eight (48) full calendar months thereafter (Lease End)), subject to extension or earlier termination as set forth in this Lease.
6.      Extension Term:	One (1) Extension Option (defined in Section 2.3.1 of the Standard Lease Provisions, below), to extend the Term (defined below) for an Extension Term (defined in Section 2.3.1 of the Standard Lease Provisions, below) of forty-eight (48) months pursuant to Section 2.3, below.
7.      Tenant Space: (a)    Premises:	The Premises described in Item 7(a), below, and the Pathway described in Item 7(b), below Landlord and Tenant acknowledge and agree that the Premises shall consist of approximately 5,500 square feet of area in the Datacenter, caged approximately as set forth on the diagram contained on Exhibit “A”, attached hereto, and shall be leased to Tenant in two (2) phases as follows: 1.      On the Commencement Date, the Premises shall be deemed to consist of approximately 2,750 square feet (as shown on Exhibit “A”, “Premises-A”) in the Datacenter. From and after the Commencement Date until the end of the sixth (6th) month of the Term (the “Prem A Period”), the “Premises” shall mean, and consist only of, Premises-A (i.e., approximately 2,750 total s.f.). 2.      As of the first day of the seventh (7th) month of the Term (the “Premises-B Expansion Date”), in addition to Premises-A, the Premises shall be deemed to have been expanded to include approximately 2,750 additional square feet (as shown on Exhibit “A”, “Premises-B”) in the Datacenter. From and after the Premises-B Expansion Date, throughout the balance of the Term of the Lease (the “Prem A-B Period”), the “Premises” shall mean and consist of

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	Premises-A, plus Premises-B (i.e., approximately 5,500 total s.f.). Landlord and Tenant acknowledge and agree that the cage (the “Cage”) for the approximately 5,500 square feet in the Datacenter that comprises Premises-A and Premises-B shall be installed by Landlord, at Landlord’s sole cost and expense, on or before the Commencement Date, as one complete caged area in the Datacenter approximately as set forth on Exhibit “A”. Landlord and Tenant also agree that, notwithstanding the staggered schedule of defining the Premises, described in items 1.-2., above, and subject to Tenant’s rights set out in Section 2.2.1, Tenant’s right to occupy and/or install equipment in all or any of the portions of such caged area (i.e., Premises-A and Premises-B) shall vest in Tenant as of the Commencement Date. The foregoing notwithstanding, (aa) for the purposes of calculating Tenant’s Electricity Consumption Threshold, the Premises shall be deemed to have been established as Premises-A on the Commencement Date, and shall be deemed to be increased during the Term of the Lease, in accordance with Items 1 through 2 of this Item 7(a); and (bb) in the event that Tenant exceeds any then current Electricity Consumption Threshold three (3) times in any five (5) day period (the date of such 3rd occurrence being referred to herein as an “Early Increase Date”), the Premises, Electricity Consumption Threshold and Base Rent shall, upon written notice thereof from Landlord to Tenant, be deemed to have automatically increased to the next level in succession as of the Early Increase Date. For example: Assuming a Commencement Date of November 1, 2007. If, on November 10, 2007 (i.e., during month 1 of the Term of the Lease), Tenant exceeds 300kW for the third time since November 5, 2007, the following would occur, as a result: (i)     November 10, 2007 would be deemed to be an Early Increase Date; (ii)    the Prem A Period would be deemed to have expired on November 10, 2007; (iii)  the Premises-B Expansion Date would be deemed to be November 11, 2007; (iv)   the first two Base Rent periods shown in Item 9, below, would be automatically revised, as follows: $41,250.00 per month from the Commencement Date through November 10th, 2007 (part of month 1 of the Term) $82,500.00 per month for the period November 11th, 2007 through October 31st, 2008 (part of month 1 of the Term and months 2-12 of the Term) (v)    $27,500.00 of additional Base Rent for the month of November, 2007, would be due from Tenant to Landlord on November 11th, 2007.
(b)    Pathway:
(i)     Pathway:	As described on Exhibit “C”.

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	Tenant is responsible for the costs and installations of all cable(s) between the Datacenter Connection Area and the Premises.
(ii)    Additional Pathway:	In the event that, at Tenant’s request, Landlord permits Tenant to use fiber or copper (or any other means of connection) in addition to the Pathway described in Item 7(b), above (any of the same, “Additional Pathway”), (i) Tenant shall pay Rent (defined in Section 3.3, below) with respect to such installations or use of such Additional Pathway in an amount equal to the then prevailing market rent in the Building established from time to time by Landlord as the rental rate for new installations and/or use of fiber, copper or other means of connection and (ii) the execution by Tenant of an amendment to this Lease describing such additional installations and/or uses of such Additional Pathway, adding such Additional Pathway and/or uses to the Tenant Space, and setting forth the Rent payable by Tenant to Landlord with respect to such additional installations and/or uses of such Additional Pathway shall be a condition precedent to Tenant’s right to use such Additional Pathway for such additional installations and/or uses.
8.      Intentionally Deleted	Intentionally Deleted
9.      Base Rent:	$41,250.00 per month for the period commencing with the Commencement Date through the end of the sixth (6th) month of the Term. $82,500.00 per month for months 7-12 of the Term. $84,975.00 per month for months 13-24 of the Term. $87,524.00 per month for months 25-36 of the Term. $90,150.00 per month for months 37-48 of the Term.
10.    Installation Fee:	Within ten (10) days after the Effective Date, Tenant will pay Landlord $                     (the “Installation Fee”) for the costs of the installations as shown on Exhibit “E” (“Landlord’s Installations”).
11.    Security Deposit; Letter          of Credit; Prepaid Rent	Within thirty (30) days after the Effective Date, Tenant agrees to either (a) pay Landlord a security deposit in the amount of $81,131.00 (the “Security Deposit”); or (b) provide Landlord a Letter of Credit payable to Landlord upon demand in the amount of $81,131.00, subject to the terms of Exhibit “I” (the “Letter of Credit”). Landlord and Tenant agree that (aa) the form of security (i.e., the Security Deposit or the Letter of Credit) that Tenant chooses to provide to Landlord within the aforementioned thirty (30) day period shall be referred to herein as the “Initial Security”; and (bb) the form of security that Tenant chooses not to initially provide to Landlord within the aforementioned thirty (30) day period shall be referred to herein as the “Alternate Security”. Landlord agrees that Tenant shall have the right, once during the term of this Lease, upon thirty (30) days’ notice (the “Replacement Security Notice Period”) to Landlord, to replace the Initial Security with the Alternate Security. Upon the providing of such notice, Tenant agrees to provide Landlord the Alternate Security. Prior to the later to occur of (a) five (5) business days after Landlord’s receipt of the Alternate Security, or (b) the expiration of the Replacement Security Notice Period, Landlord shall return the Initial Security to Tenant. From and after Tenant’s delivery to Landlord of the Alternate Security and Landlord’s return of the Initial Security to Tenant, each, as described above, Tenant’s obligation to provide

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	Landlord the Alternate Security shall govern throughout the balance of the Term of the Lease. For example: in the event that Tenant’s Initial Security is the Security Deposit, Landlord agrees that Tenant shall have the right, once during the term of this Lease, upon thirty (30) days’ notice to Landlord, to replace the Security Deposit with the Letter of Credit. Upon the providing of such notice, Tenant agrees to provide Landlord the Letter of Credit. Prior to the later to occur of (a) five (5) business days after Landlord’s receipt of the Letter of Credit, or (b) the expiration of the aforementioned thirty (30) day period, Landlord shall return the Security Deposit to Tenant (or so much of the Security Deposit that, in accordance with Section 5 of the Standard Lease Provisions, below, remains at such point in time). From and after Tenant’s delivery of the Letter of Credit and Landlord’s return of the Security Deposit to Tenant, each, as described above, Tenant’s obligation to provide Landlord a current Letter of Credit shall govern throughout the balance of the Term of the Lease. Prepaid Rent: $41,250.00 due and payable upon Tenant’s execution of the Lease, consisting of the first month’s Base Rent.
12.    Datacenter Rules and          Regulations:	This term shall mean Landlord’s rules and regulations for the Datacenter (the “Datacenter Rules and Regulations”), as such Datacenter Rules and Regulations may be amended from time to time by Landlord in accordance with Section 6.2 of the Standard Lease Provisions. The current version of the Datacenter Rules and Regulations is attached hereto as Exhibit “H”.
13.    Intentionally Deleted	Intentionally Deleted
14.    Intentionally Deleted	Intentionally Deleted
15.    Eligibility Period:	One day’s Rent for each one (1) hour period (or part thereof) during which an Interruption of Landlord’s Service has occurred and is continuing, up to a maximum of three (3) days’ abatement for each twenty-four (24) hour period of such interruption. For example: (a) if such Interruption of Landlord’s Service continues for one (1) minute, one (1) day’s Rent shall be abated; (b) if such Interruption of Landlord’s Service continues for a consecutive period of sixty (60) minutes, one (1) additional day’s Rent shall be abated; (c) if such Interruption of Landlord’s Service continues for a consecutive period of one-hundred twenty (120) minutes, one (1) additional day’s Rent shall be abated; and (d) if such Interruption of Landlord’s Service continues for a consecutive period of twenty-four (24) hours and one minute (and for each period of twenty-four (24) hours thereafter during which such Interruption of Landlord’s Service continues – whether such Interruption of Landlord’s Service is continuous, or whether there are brief periods of service followed by further interruptions related to the same initial root cause (i.e., a specific PDU has become inoperable, or a specific CRAC unit has become inoperable) [all such subsequent Interruption of Landlord’s Service are deemed to be the “Same Interruption”]), one (1) additional day’s Rent shall be abated for each of the first (1st) three (3) hours of each successive twenty-

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	four (24) hour period of the Same Interruption. The maximum Rent abatement for any twenty-four (24) hour period during which an Interruption of Landlord’s Service occurs, regardless of the number or length of Interruption of Landlord’s Service stemming from the Same Interruption in such twenty-four (24) hour period, shall not exceed three (3) days’ Rent, in accordance with (a)-(d), above. The foregoing notwithstanding, Interruption of Landlord’s Service that are not the “Same Interruption” shall entitle Tenant to the abatement rights described above with regard to each Independent Interruption (defined below). For example: if (aa) a specific PDU becomes inoperable due to an internal electrical malfunction, causing some or all of Tenant’s operations to lose power, and (bb) a specific CRAC unit becomes inoperable due to a lack of the necessary cooling agent, causing a rise in the temperature of the Premises above that which is described in Item 4(a) of Exhibit “F”, such that Tenant cuts power to its operating equipment in order to protect such equipment from the effects of high temperatures (and such lack of cooling agent is not directly caused by the inoperable PDU), then (aa) and (bb) would be considered “Independent Interruptions”.
16.    Landlord’s Address          for Notices:	Digital Phoenix Van Buren, LLC c/o Digital Realty Trust, L.P. 120 E. Van Buren Suite 120 Phoenix, AZ 85004 Attn: Property Manager Facsimile: (602) 716.5748 E-mail: leaseadministration@digitalrealtytrust.com	With copies to: Digital Realty Trust, L.P. 600 West 7th Street, Suite 540 Los Angeles, CA 90017 Attention: Danny Lane and Patricia Houston Facsimile No. (213) 688-2811 E-mail: dlane@digitalrealtytrust.com; phouston@digitalrealtytrust.com And: Stutzman, Bromberg, Esserman & Plifka, A Professional Corporation 2323 Bryan Street, Suite 2200 Dallas, TX 75201 Attention: Noah K. Hansford Facsimile No. (214) 969-4999 E-mail: hansford@sbep-law.com
17.    Landlord’s Address          for Payment of Rent:	ACH Payments: Bank of America NT&SA 1850 Gateway Blvd. Concord, CA 94520-3282 Routing Number: 121000358 Account Number: 1459242282 Account Name: Digital Phoenix Van Buren, LLC Regarding/Reference: Tenant Account No., Invoice No.

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	Wire Transfer: Bank of America NT&SA 100 West 33rd Street New York, NY 10001 Routing Number: 026009593 SWIFT: BOFAUS3N Account Number: 1459242282 Account Name: Digital Phoenix Van Buren, LLC Regarding/Reference: Tenant Account No., Invoice No. Check Payments: Digital Phoenix Van Buren, LLC P.O. Box 50648 Los Angeles, CA 90074-0648 Overnight Address: Bank of America Lockbox Services File 50648 Ground Level 1000 West Temple St. Los Angeles, CA 90012 Contact Information: Director of Cash Management Digital Realty Trust 560 Mission Street, Suite 2900 San Francisco, CA 94104 P: (415) 738-6509 F: (415) 495-3687
18.    Brokers:
(a)    Landlord’s Broker:	None.
(b)    Tenant’s Broker:	None.
19.    Intentionally Deleted	Intentionally Deleted
20.    Land:	The land (“Land”) located at: 120 East Van Buren Street, Phoenix, Arizona
21.    Building:	120 East Van Buren Street: A Three (3)-story building consisting of approximately 300,000 rentable square feet (the “Building”)
22.    Datacenter:	Suite 130 of the Building depicted on Exhibit “A” attached hereto.
23.    Meet-Me Room:	Suites MMR1 and MMR2 of the Building located on the Plaza floor of the Building serve as the common interconnection areas for Building tenants and Datacenter tenants.

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24.    Landlord Group: Landlord, Digital Realty Trust, L.P., Digital Realty Trust, Inc., and their respective directors, officers, shareholders, members, employees, agents, constituent partners, affiliates, beneficiaries, trustees and representatives (the “Landlord Group”).

This Lease shall consist of the foregoing Basic Lease Information, and the provisions of the Standard Lease Provisions (the “Standard Lease Provisions”) (consisting of Sections 1 through 17 which follow) and Exhibits “A” through “I”, inclusive, all of which are incorporated herein by this reference as of the Effective Date. In the event of any conflict between the provisions of the Basic Lease Information and the provisions of the Standard Lease Provisions, the Basic Lease Provisions shall control. Any initially capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Standard Lease Provisions.

[no further text on this page]

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STANDARD LEASE PROVISIONS

1. LEASE OF PREMISES.

1.1 Tenant Space. In consideration of the covenants and agreements to be performed by Tenant, and upon and subject to the terms and conditions of this Lease, Landlord hereby leases to Tenant for the Term (defined in Section 2.1, below), (i) that certain space in the cage(s) specified in Item 7(a) of the Basic Lease Information in the approximate locations depicted on Exhibit “A” attached hereto (the “Premises”) and (ii) those certain conduit(s) , partial conduit(s) and/or dark fiber(s) or copper described in Item 7(b) of the Basic Lease Information (the “Pathway”). The Premises and the Pathway shall be referred to herein collectively as the “Tenant Space.”

1.2 Condition of Tenant Space. Tenant has inspected the Datacenter and the Tenant Space and, subject to Landlord’s completion of Landlord’s Installations, Tenant accepts the Tenant Space in its “AS IS, WHERE IS” condition. Tenant acknowledges and agrees that (i) no representation or warranty (express or implied) has been made by Landlord as to the condition of the Property, the Building, the Datacenter or the Tenant Space or their suitability or fitness for the conduct of Tenant’s Permitted Use, its business or for any other purpose, except as expressly provided herein, and (ii) except as specifically set forth herein, Landlord shall have no obligation to construct or install any improvements in or to make any other alterations or modifications to the Tenant Space. Upon the completion of the Commencement Date Conditions, the taking of possession of the Tenant Space by Tenant (i.e. Tenant is not considered to be “in possession of the Tenant Space” during any period of Early Access (defined below)) shall conclusively establish that the Tenant Space was at such time in good order and clean condition.

1.3 Datacenter Connection Area. Tenant acknowledges and agrees that all interconnections between the systems of Tenant and those of other tenants of the Datacenter and/or the Building must be made in the Meet-Me Room. During the Term of this Lease and subject to availability, Tenant shall have the right to lease Additional Pathway between the Datacenter Connection Area and the Meet-Me Room upon Landlord’s then prevailing standard rates and terms for such Additional Pathway. Tenant acknowledges that the Datacenter Connection Area is a common use area that will be used by and be accessible by other tenants and their technicians. The foregoing notwithstanding, Tenant acknowledges that the Meet-Me Room is operated by an entity (not an affiliate of Landlord) named tel^X – Phoenix, LLC (“tel^x”). All operations in the Meet-Me Room (including all MMR Services, as defined in Section 6.1, below), and all Tenant presence, including pathway, in the Meet-Me Room (other than connections made in Landlord’s Meet-Me Room interconnection rack) are governed and controlled by tel^x; each and all of which is subject to such agreements and costs as are required, from time to time, by tel^x.

1.4 Intentionally Deleted.

1.5 Quiet Enjoyment; Access. Subject to all of the terms and conditions of this Lease, Tenant shall quietly have, hold and enjoy the Tenant Space without hindrance from Landlord or any person or entity claiming by, through or under Landlord. Subject to the terms and conditions of this Lease (including, without limitation, the Datacenter Rules and Regulations (defined in Section 6.2, below)) and Landlord’s Access Control Systems (defined in Section 7.1, below) and Force Majeure (as defined in Section 17.14 below), Tenant shall have access to the Tenant Space twenty-four (24) hours per day, seven (7) days per week.

2. TERM.

2.1 Term. The term of this Lease, and Tenant’s obligation to pay Rent under this Lease, shall commence on the Commencement Date and shall continue in effect for the period specified in Item 5 of the Basic Lease Information (the “Term”), unless this Lease is earlier terminated as provided herein.

2.2 Delivery of Tenant Space. Delivery of Tenant Space. Landlord shall use commercially reasonable efforts to cause the Commencement Date Conditions to occur prior to the Target

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Commencement Date. Upon the occurrence of the Commencement Date, Landlord shall deliver the Commencement Date Notice to Tenant.

2.2.1 Intentionally deleted.

2.2.2 In the event that the Commencement Date Conditions have not occurred by the Target Commencement Date, Landlord shall not be deemed in default hereunder, and the Commencement Date shall be postponed, as Tenant’s sole and exclusive remedy, until the date on which the Commencement Date Conditions have occurred. Notwithstanding the forgoing, in the event that the Commencement Date Conditions have not occurred prior to December 31, 2007, subject to extension related to Tenant Delay (defined below) and Force Majeure (not to exceed 60 days of Force Majeure), Tenant shall have the right, as its sole and exclusive remedy, to terminate this Lease by delivering written notice of such termination to Landlord. Should the Commencement Date Conditions occur prior to Tenant’s exercise of the foregoing termination right, however, such termination right shall, in such event, expire and be of no further force or effect upon such occurrence of the Commencement Date Conditions. For the purposes of this Lease, “Tenant Delay” shall mean a delay in Landlord’s completion of the Commencement Date Conditions, which is attributable to or caused by any change order by Tenant.

2.2.3 Tenant acknowledges that Tenant shall be responsible for installing, at Tenant’s sole cost and expense, any and all work (other than the completion of the Commencement Date Conditions) for the Premises (collectively, the “Tenant Work”). Sections 2.2, 2.2.1 & 2.2.2, above, notwithstanding, Landlord agrees, subject to the terms and conditions of this Section 2.2.3, to permit Tenant and its contractors, subcontractors, space planner/interior architect, engineers, consultants, vendors, suppliers and other representatives, and their respective employees to enter and occupy the Premises, prior to the Commencement Date (“Early Access”), for the purposes of inspecting same and for performing Tenant Work, including the installation of fixtures and equipment (e.g., telephone, communications and computer equipment and the wiring and cabling for same), on and after the date upon which Landlord notifies Tenant, verbally or otherwise, that the Premises is dust-free and safe for Tenant’s occupancy, as determined by Landlord in Landlord’s sole and absolute discretion, but not before Tenant’s Early Access would materially delay Landlord’s ability to complete the Commencement Date Conditions on or before the Target Commencement Date (the date upon which Landlord provides such notice of Early Access is referred to herein as the “Early Access Date”; the period between the Early Access Date and the Commencement Date is referred to herein as the “Early Access Period”). Any such permission shall constitute a license only, conditioned upon Tenant’s:

(a) working in harmony with Landlord and Landlord’s agents, contractors, workmen, mechanics and suppliers; and

(b) furnishing Landlord with such insurance as Landlord may reasonably require against liabilities which may arise out of such entry; provided that, in no event shall such insurance requirements exceed those that are described on Exhibit “B”, attached hereto.

Notwithstanding anything in this Lease to the contrary, the Early Access Period may be reduced by Landlord to the extent such Early Access materially interferes with Landlord’s ability to complete the Commencement Date Conditions on or before the Target Commencement Date. Additionally, Tenant agrees that, while Tenant shall not be required to pay Base Rent during the Early Access Period, Tenant shall be required to pay any and all electricity charges that accrue to the Premises during the Early Access Period. Tenant’s Early Access right is subject to Tenant executing and delivering to Landlord a Memorandum of Understanding in the form attached hereto as Exhibit “E-2”.

2.3 Extension Option.

2.3.1 Subject to and in accordance with the terms and conditions of this Section 2.3, Tenant shall have the number of options (each, an “Extension Option”) specified in Item 6 of the Basic Lease Information to extend the Term of this Lease with respect to the entire Tenant Space, each for an

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additional term of forty-eight (48) calendar months (collectively the “Extension Terms”, each an “Extension Term”), upon the same terms, conditions and provisions applicable to the then current Term of this Lease (except as provided otherwise herein). The Base Rent payable with respect to the Tenant Space for each year of the Extension Term (the “Option Rent”) shall be increased hereunder as of the first (1^st) day of each such year to be equal to one hundred three percent (103%) of the Base Rent payable for the immediately preceding year of the Term of the Lease, as extended.

2.3.2 Tenant may exercise each Extension Option only by delivering to Landlord a written notice (an “Option Exercise Notice”) at least nine (9) calendar months (and not more than twelve (12) calendar months) prior to then applicable expiration date of the Term, which Option Exercise Notice shall specify that Tenant is irrevocably exercising its Extension Option so as to extend the Term of this Lease by an Extension Term on the terms set forth in this Section 2.3. In the event that Tenant shall duly exercise an Extension Option, the Term shall be extended to include the applicable Extension Term (and all references to the Term in this Lease shall be deemed to refer to the Term specified in Item 5 of the Basic Lease Information, plus all duly exercised Extension Terms). In the event that Tenant shall fail to deliver an Option Exercise Notice within the applicable time period specified herein for the delivery thereof, time being of the essence, at the election of Landlord, Tenant shall be deemed to have forever waived and relinquished such Extension Option, and any other options or rights to renew or extend the Term effective after the then applicable expiration date of the Term shall terminate and shall be of no further force or effect.

2.3.3 Tenant shall have the right to exercise any Extension Option only with respect to the entire Tenant Space leased by Tenant at the time that Tenant delivers an Option Exercise Notice. If Tenant duly exercises an Extension Option, Landlord and Tenant shall execute an amendment reflecting such exercise. Notwithstanding anything to the contrary herein, any attempted exercise by Tenant of an Extension Option shall, at the election of Landlord, be invalid, ineffective, and of no force or effect if, on the date on which Tenant delivers an Option Exercise Notice or on the date on which the Option Term is scheduled to commence there shall be an uncured Event of Default by Tenant under this Lease

3. BASE RENT AND OTHER CHARGES.

3.1 Base Rent. Commencing on the Commencement Date, Tenant shall pay to Landlord base rent (the “Base Rent”) for the Tenant Space in the amount set forth in Item 9 of the Basic Lease Information. All such Base Rent shall be paid to Landlord in equal monthly installments in advance on the first day of each and every month throughout the Term of this Lease; provided, however, that (a) the first full monthly installment of Base Rent shall be payable upon Tenant’s execution of this Lease and (b) if the Term of this Lease does not commence on the first day of a calendar month, the Base Rent for such partial calendar month shall (i) be calculated on a per diem basis determined by dividing the Base Rent above by the actual number of days in such month and multiplying such amount by the number of days remaining in such calendar month from and after (and including) the Commencement Date, and (ii) shall be paid by Tenant to Landlord on the Commencement Date. Except as set forth in this Section 3.1, Tenant shall not pay any installment of Rent (defined in Section 3.3, below) more than one (1) month in advance.

3.2 Installation Fee/Other Charges. In addition to paying the Base Rent, within thirty (30) days after Tenant’s receipt of an invoice therefor from Landlord, Tenant shall pay to Landlord as Additional Rent the one-time installation fee and any other charges specified in Item 10 of the Basic Lease Information as partial consideration for the fixturization of the Datacenter as set forth on Exhibit “E” attached hereto and Landlord’s costs in connection with this Lease and Tenant’s commencement of operations within the Tenant Space

3.3 Payments Generally. Base Rent, all forms of Additional Rent (defined in this Section 3.3, below) payable hereunder by Tenant and all other amounts, fees, payments or charges payable hereunder by Tenant shall (i) each constitute rent payable hereunder (and shall sometimes collectively be referred to herein as “Rent”), (ii) be payable to Landlord when due without any prior notice or demand therefor (except as provided herein) in lawful money of the United States without any abatement, offset or

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deduction whatsoever (except as specifically provided otherwise herein), and (iii) be payable to Landlord at the address of Landlord specified in Item 17 of the Basic Lease Information (or to such other person or to such other place as Landlord may from time to time designate in writing to Tenant. No receipt of money by Landlord from Tenant after the termination of this Lease, the service of any notice, the commencement of any suit, or a final judgment for possession shall reinstate, continue or extend the Term of this Lease or affect any such notice, demand, suit or judgment. No partial payment by Tenant shall be deemed to be other than on account of the full amount otherwise due, nor shall any endorsement or statement on any check or any letter accompanying any check or payment be deemed an accord and satisfaction, and Landlord shall be entitled to accept such payment without compromise or prejudice to any of the rights of Landlord hereunder or under any Applicable Laws (defined in Section 6.3.1, below). In the event that the Commencement Date or the Expiration Date (or the date of any earlier termination of this Lease) falls on a date other than the first or last day of a calendar month, respectively, the Rent payable for such partial calendar month shall be prorated based on a per diem basis. For purposes of this Lease, all amounts (other than Base Rent) payable by Tenant to Landlord pursuant to this Lease, whether or not denominated as such, shall constitute “Additional Rent.” All Rent payable hereunder, except for Base Rent and except as otherwise specifically set forth herein, shall be payable in arrears within thirty (30) day of invoice by Landlord.

3.4 Late Payments. Tenant hereby acknowledges and agrees that the late payment by Tenant to Landlord of Base Rent or Additional Rent (or any other sums due hereunder) will cause Landlord to incur administrative costs not contemplated under this Lease and other damages, the exact amount of which would be extremely difficult or impractical to fix. Landlord and Tenant agree that if Landlord does not receive any such payment on or before the date that is five (5) days after the date on which such payment is due (a “Late Charge Delinquency”), Tenant shall pay to Landlord, as Additional Rent, (i) a late charge (“Late Charge”) equal to five percent (5%) of the amount overdue to cover such additional administrative costs and damages, and (ii) interest on all such delinquent amounts at an interest rate (the “Default Rate”) equal to the lesser of (a) one and one-half percent (1 ¹/2 %) per month or (b) the maximum lawful rate from the date such amounts are first delinquent until the date the same are paid. In no event, however, shall the charges permitted under this Article 3 or elsewhere in this Lease, to the extent the same are considered to be interest under applicable law, exceed the maximum lawful rate of interest. Landlord’s acceptance of any Late Charge, or interest pursuant to this Section 3.4, shall not be deemed to constitute a waiver of Tenant’s default with respect to the overdue amount, nor prevent Landlord from exercising any of the other rights and remedies available to Landlord hereunder or under any Applicable Laws. Notwithstanding anything herein to the contrary, Landlord agrees to waive the default interest and late charges for one (1) late payment hereunder during any consecutive twelve (12) calendar month period during the Term provided such late payment is paid in full within five (5) business days after written notice to Tenant of such failure.

3.5 Electrical Power. Tenant shall pay for all electricity provided to and/or used in the Tenant Space, as set forth herein. An electrical metering device (or electrical metering devices) (collectively, the “Electrical Metering Equipment”) compatible with Landlord’s energy management system for monitoring electricity provided to and/or used in the Tenant Space shall be installed by Tenant at Tenant’s cost. Landlord shall bill Tenant monthly for the actual cost of all electricity provided to and/or used in the Tenant Space based upon the Electrical Metering Equipment (the “Actual Electrical Costs”), plus a cost-recovery factor equal to fifty percent (50%) of the Actual Electrical Costs (the “Shared Electrical Payment”; together with the Actual Electrical Costs, collectively, the “Power Payment”). Tenant shall pay the Power Payment to Landlord, as Additional Rent, within thirty (30) days of delivery of such Power Payment invoice. Landlord and Tenant acknowledge that the Shared Electrical Payment is intended to reimburse Landlord for electricity used by certain equipment within the Tenant Space and/or by equipment located outside the Tenant Space but serving the Tenant Space, which usage, in either case, is commercially impractical of being metered because it utilizes equipment and/or facilities designed to serve more area of the Building than just the Tenant Space (the “Shared Electrical Equipment”). For the avoidance of doubt, it is the intent of the parties that this Section 3.5 represents a mechanism only for Landlord’s cost recovery with regard to electrical power provided to and/or used in or for the Tenant Space, and that there is no intent for Tenant’s Power Payment to include any element of profit to the Landlord in connection therewith.

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4. TAX ON TENANT’S EQUIPMENT; OTHER TAXES.

4.1 Equipment Taxes. Tenant shall be liable for and shall pay at least ten (10) days before delinquency (and Tenant hereby indemnifies and holds Landlord harmless from and against any Claims (defined in Section 14.2, below) arising out of, in connection with, or in any manner related to) all governmental fees, taxes, tariffs and other charges levied directly or indirectly against any personal property, fixtures, machinery, equipment, apparatus, systems, connections, interconnections and appurtenances located in or used by Tenant in or in connection with the Tenant Space. If any such taxes for which Tenant is liable are levied or assessed against Landlord or Landlord’s property, and if Landlord elects to pay the same, Tenant shall pay to Landlord as Additional Rent, within ten (10) days of Landlord’s demand therefor, that part of such taxes for which Tenant is liable hereunder.

4.2 Additional Taxes. Tenant shall pay to Landlord, as Additional Rent and within ten (10) days of Landlord’s demand therefor, and in such manner and at such times as Landlord shall direct from time to time by written notice to Tenant, any excise, sales, privilege, margin or other tax, assessment or other charge imposed, assessed or levied by any governmental or quasi-governmental authority or agency upon Landlord on account of (i) the Rent (and other amounts) payable by Tenant hereunder (or any other benefit received by Landlord hereunder), including, without limitation, any gross receipts tax, license fee or excise tax levied by any governmental authority, (ii) this Lease, Landlord’s business as a lessor hereunder, and the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy of any portion of the Tenant Space (including, without limitation, any applicable possessory interest taxes), (iii) this transaction or any document to which Tenant is a party creating or transferring an interest or an estate in the Tenant Space, or (iv) otherwise in respect of or as a result of the agreement or relationship of Landlord and Tenant hereunder. Notwithstanding the foregoing, Tenant shall not be responsible for the payment of any federal and state income taxes, franchise taxes, excess profits taxes gift taxes, capital stock taxes, inheritance and succession taxes, estate taxes, and other taxes applied or measured by Landlord’s general or net income (as opposed to taxes applied or measured by Landlord’s rents, receipts, or income attributable to operations at the Building and/or taxes that are commonly referred to as “margin” taxes or “net profits” taxes).

5. SECURITY DEPOSIT; LETTER OF CREDIT.

5.1 In the event that Tenant elects to deposit the amount specified in Item 11 of the Basic Lease Information as a security deposit (the “Security Deposit”), the provisions of this Section 5.1 shall apply to the Security Deposit. Landlord shall hold the Security Deposit as security for the performance by Tenant of Tenant’s covenants and obligations under this Lease, it being expressly understood and agreed that the Security Deposit shall not be considered an advance payment of Rent or a measure of Landlord’s damages in case of default by Tenant. The Security Deposit shall be held by Landlord without liability to Tenant for interest, and Landlord may commingle such deposit with any other funds held by Landlord. Upon the occurrence of any Event of Default (defined in Section 15.1 below), Landlord may, from time to time, without prejudice to any other remedy, apply the Security Deposit to the extent necessary to make good any arrears of Base Rent, Additional Rent, and any other payment, damage, injury, expense or liability caused to Landlord by such Event of Default. Following any application of the Security Deposit, Tenant shall pay to Landlord on demand the amount so applied in order to restore the Security Deposit to the amount thereof immediately prior to such application. Subject to the requirements of, and conditions imposed by, governmental laws, rules and regulations applicable to security deposits under commercial leases (the “Applicable Security Deposit Laws”), Landlord shall, within the time required by Applicable Security Deposit Laws, or if no such requirement, within sixty (60) days after the expiration of the Term of this Lease (or the earlier termination of this Lease), return to Tenant the portion (if any) of the Security Deposit remaining after deducting all damages, charges and other amounts owing by Tenant to Landlord under this Lease. Landlord and Tenant agree that such deductions shall include, without limitation, all damages and losses that Landlord has suffered or that Landlord reasonably estimates that it will suffer as a result of any default under this Lease by Tenant. If Landlord transfers Landlord’s interest in the Tenant Space during the Term of this Lease (including any extension thereof), Landlord may assign the Security Deposit to the transferee, and upon such transfer and the delivery to Tenant of an acknowledgement of the

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transferee’s responsibility for the Security Deposit, Landlord shall have no further liability for the return of the Security Deposit. In the event the provisions of any Applicable Security Deposit Laws, or other provisions of Law, now or hereinafter in force, which restricts the amount or types of claims that a landlord may make upon a security deposit or imposes upon a landlord (or its successors) any obligation with respect to the handling or return of security deposits, conflict with the terms and conditions of this Section 5, the terms and conditions of this Section 5 shall govern.

6. USE.

6.1 Permitted Use. Subject to the terms of this Lease, including, specifically, Sections 1.3 and 6.3.1, Tenant shall be entitled to use the Tenant Space only for the placement, maintenance and operation of computer, switch and/or communications equipment, fixtures, machinery, apparatus, systems, connections, interconnections, appurtenances and the like (in accordance with the terms of this Lease, including, specifically, Sections 8.4 and 13.1) (the “Permitted Use”). Any other use of the Tenant Space is subject to Landlord’s prior written consent, which consent may be withheld or conditioned in Landlord’s sole and absolute discretion. Additionally, and not withstanding anything to the contrary contained in this Section 6.1, Tenant may not operate a Meet-Me Room in the Tenant Space or any other portion of the Building, provide MMR Services (as defined below) in the Tenant Space or any other portion of the Building, or refer to the Tenant Space as a Meet-Me Room. As used herein “MMR Services” means the services typically provided by companies in the primary business of providing carrier-neutral interconnections, such as the Switch & Data, Equinix, CRG West and Telehouse, including without limitation, furnishing of space, racks and pathway to parties for the purpose of such party’s placement and maintenance of computer, switch and/or communications equipment and connections with the communications cable and facilities of other parties in the Building.

6.2 Datacenter Rules and Regulations. Tenant’s Permitted Use shall be subject to, and Tenant, and Tenant’s agents, employees and invitees shall comply fully with all requirements of the Datacenter Rules and Regulations. Landlord shall at all times have the right to change such rules and regulations or to amend or supplement them in such manner as may be deemed (by Landlord in the exercise of its sole but good faith discretion) advisable for the safety, care and cleanliness of the Tenant Space, the Datacenter, the Building and the Property and for preservation of good order therein, all of which Datacenter Rules and Regulations, as changed, amended, and/or supplemented from time to time, shall be fully carried out and strictly observed by Tenant; provided, however, that such changes to the Datacenter Rules and Regulations may not increase Tenant’s monetary obligations under this Lease or unreasonably interfere with access to or the beneficial use of the Tenant Space for the Permitted Use. In the event of a conflict between the Datacenter Rules and Regulations and the terms of this Lease, the terms of this Lease shall govern. Tenant shall further be responsible for the compliance with such Datacenter Rules and Regulations (as the same may be changed, amended and/or supplemented from time to time) by the employees, agents and invitees of Tenant. Landlord shall apply the Datacenter Rules and Regulations in a non-discriminatory manner and uniformly to the tenants of the Datacenter.

6.3 Compliance with Laws; Hazardous Materials.

6.3.1 Compliance with Laws. Tenant, at Tenant’s sole cost and expense, shall timely take all action required to cause the Tenant Space to comply in all respects with all laws, ordinances, building codes, rules, regulations, orders and directives of any governmental authority having jurisdiction (including without limitation any certificate of occupancy), and all covenants, conditions and restrictions affecting the Property now or in the future applicable to the Tenant Space (collectively, “Applicable Laws”) and with all rules, orders, regulations and requirements of any applicable fire rating bureau or other organization performing a similar function. Tenant shall not use the Tenant Space, or permit the Tenant Space to be used, in any manner, or do or suffer any act in or about the Tenant Space which: (i) violates or conflicts with any Applicable Law; (ii) causes or is reasonably likely to cause damage to the Property, the Building, the Tenant Space or the Building and/or Property systems and equipment, including, without limitation, all fire/life safety, electrical, HVAC, plumbing or sprinkler, access control (including, without limitation, Landlord’s Access Control Systems), mechanical, telecommunications, elevator and escalator

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systems and equipment (collectively, the “Building Systems”); (iii) will invalidate or otherwise violates a requirement or condition of any fire, extended coverage or any other insurance policy covering the Property, the Building, and/or the Tenant Space, or the property located therein, or will increase the cost of any of the same (unless, at Landlord’s election, Landlord permits an activity which will cause an increase in any such insurance rates on the condition that Tenant shall agree in writing to pay any such increase to Landlord immediately upon demand as Additional Rent); (iv) constitutes or is reasonably likely to constitute a nuisance to other tenants or occupants of the Datacenter, the Building or the Property, or any equipment, facilities or systems of any such Tenant; (v) interferes with, or is reasonably likely to interfere with, the transmission or reception of microwave, television, radio, telephone, or other communication signals by antennae or other facilities located at the Property; (vi) amounts to (or results in) the commission of waste in the Tenant Space, the Datacenter, the Building or the Property; (vii) violates the Datacenter Rules and Regulations; or (viii) is other than the Permitted Use. Tenant shall be responsible for any losses, costs or damages in the event that unauthorized parties gain access to the Tenant Space, the Building or the Datacenter through access cards, keys or other access devices provided to Tenant by Landlord. Tenant shall promptly upon demand reimburse Landlord as Additional Rent for any additional premium charged for any insurance policy by reason of Tenant’s failure to comply with the provisions of this Section 6.3. Notwithstanding anything in this Lease to the contrary, as between Landlord and Tenant, (1) Tenant shall bear the responsibility and cost of complying with all Applicable Laws (including without limitation, Title III of the Americans With Disabilities Act of 1990, any state laws governing handicapped access or architectural barriers, and all rules, regulations, and guidelines promulgated under such laws, as amended from time to time (the “Disabilities Acts”)) in the Tenant Space (except as to Landlord’s Installations listed on Exhibit “E,” for which Landlord shall be responsible), and (2) Landlord shall bear the responsibility and cost of complying with all Applicable Laws, including the Disabilities Acts, (aa) in the common areas, (bb) in the Tenant Space, but only with respect to Landlord’s Installations, and (cc) related to the Building’s structure and the Building’s utility and life-safety systems, other than (i) compliance that is necessitated by the use of the Tenant Space, or (ii) compliance that is necessitated with regard to any portion of the Tenant Space that is not Landlord’s Installations (in either case, responsibility and cost of which shall be borne by Tenant).

6.3.2 Hazardous Materials. No Hazardous Materials (defined below) shall be Handled (defined below) upon, about, in, at, above or beneath the Tenant Space or any portion of the Building or the Property by or on behalf of Tenant, its Transferees (defined in 10.1, below), or their respective contractors, clients, officers, directors, employees, representatives, licensees, agents, or invitees (the “Tenant Parties”). Notwithstanding the foregoing, normal quantities of those Hazardous Materials customarily used in the conduct of the Permitted Use may be used at the Tenant Space without Landlord’s prior written consent, but only in compliance with all applicable Environmental Laws (defined below) and only in a manner consistent with Institutional Owner Practices (defined in Section 8.3, below). “Environmental Laws” shall mean and include all now and hereafter existing Applicable Laws regulating, relating to, or imposing liability or standards of conduct concerning public health and safety or the environment. “Hazardous Materials” shall mean and include: (1) any material or substance: (i) which is defined or becomes defined as a “hazardous substance,” “hazardous waste,” “infectious waste,” “chemical mixture or substance,” or “air pollutant” under Environmental Laws; (ii) containing petroleum, crude oil or any fraction thereof; (iii) containing polychlorinated biphenyls (PCB’s); (iv) asbestos, asbestos-containing materials or presumed asbestos-containing materials (collectively, “ACM”); (v) which is radioactive; (vi) which is infectious; or (2) any other material or substance displaying toxic, reactive, ignitable or corrosive characteristics, and are defined, or become defined by any Environmental Law. “Handle,” “Handled,” or “Handling” shall mean any installation, handling, generation, storage, treatment, use, disposal, discharge, release, manufacture, refinement, presence, migration, emission, abatement, removal, transportation, or any other activity of any type in connection with or involving Hazardous Materials.

6.4 Electricity Consumption Threshold. Tenant’s actual electricity consumption for the Premises, as reasonably determined by Landlord pursuant to such measurement method or methods as Landlord shall employ from time to time acting consistently with Institutional Owner Practices (including, without limitation, the use of submeters and/or pulse meters, electrical surveys and/or engineer’s estimates), shall not at any time, exceed the number of watts for the Premises specified in Item 1 of Exhibit

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“F” (the “Electricity Consumption Threshold”). All equipment (belonging to Tenant or otherwise) located within the Premises shall be included in the calculation of Tenant’s actual electricity consumption for the Premises.

6.5 Structural Load. Tenant shall not place a load upon the Premises or the Datacenter exceeding the number of pounds of live load per square foot specified in Item 5 of Exhibit “F”. Any cabinets, cages or partitions installed by Landlord shall be included in the calculation of the live load.

7. SERVICES TO BE PROVIDED TO THE TENANT SPACE.

7.1 Access Control. Landlord will provide access control as follows: (i) Landlord will operate a check-in desk at the Building’s main entrance twenty-four (24) hours per day, seven (7) days per week, (ii) Landlord has installed an electronic “key card” system and an electronic “biometric” system to control access to the Datacenter, and (iii) Landlord has installed a video surveillance system in the Datacenter (collectively, “Landlord’s Access Control Systems”). Landlord disclaims any and all other responsibility or, obligation to provide additional access control (or any security) to the Building, the Datacenter, the Datacenter Connection Area, the Tenant Space, or any portion of any of the above. Landlord reserves the right, to be exercised by Landlord in its sole and absolute discretion, but without assuming any duty, to institute additional access control measures in order to further control and regulate access to the Building, the Datacenter or any part thereof. Landlord shall not, under any circumstances, be responsible for providing or supplying security services to the Tenant Space or any part of the Datacenter or the Building in excess of the Landlord’s Access Control Systems expressly set forth in this Section 7.1 (and Landlord shall not under any circumstances be deemed to have agreed to provide any services in excess of the above specified Landlord’s Access Control Systems). Subject to Landlord’s approval of the plans and specifications therefor and the contractors who will perform such work, Tenant may install, at its sole cost and expense, its own security system (“Tenant’s Security System”) for the Premises. Tenant shall furnish Landlord with a copy of all key codes, access cards and other entry means and ensure that Landlord shall have access to the Premises at all times. Additionally, Tenant shall ensure that Tenant’s Security System shall comply with all applicable laws, ordinances, rules and regulations, including all fire safety laws, and in no event shall Landlord be liable for the malfunctioning thereof, and Tenant shall indemnify Landlord therefrom. Tenant shall have the right, subject to Landlord’s reasonable approval and at its sole cost and expense, to integrate Tenant’s security system and management systems into Landlord’s Building security system and Building management systems. Tenant acknowledges and agrees that it understands that all persons in the Datacenter and the activities of all such persons are and shall be subject to surveillance by video camera and/or otherwise by Landlord’s agents and employees. Tenant further acknowledges and agrees that it understands that the Datacenter Connection Area is a non-exclusive use area that will be utilized by other tenants of the Datacenter.

7.2 Electricity; HVAC.

7.2.1 Electricity. Landlord shall furnish electricity to the Premises in accordance with the specifications set forth in Item 1 of Exhibit “F” attached hereto. The obligation of Landlord to provide electricity to the Tenant Space shall be subject to the rules and regulations of the supplier of such electricity and of any governmental authorities regulating providers of electricity and shall be limited to providing the Electricity Consumption Threshold (as defined in Section 6.4). Except as expressly set forth in Items 2 and 3 of Exhibit “F”, Tenant shall be solely responsible for all emergency, supplemental or back-up power systems (“Back-Up Power”) for use in the Tenant Space. Landlord expects its back-up generator (identified in Item 3 of Exhibit “F”) to begin operating within the target battery capacity period set forth in Item 2 of Exhibit “F” in the event of a utility interruption.

7.2.2 HVAC. Landlord shall furnish HVAC (defined below) to the Premises in accordance with the specifications set forth in Item 4(c) of Exhibit “F” attached hereto. The obligation of Landlord to provide HVAC to the Premises shall be subject to the rules and regulations of the supplier of electricity and of any governmental authorities regulating providers of electricity and with the provision of HVAC service, and shall be limited to providing HVAC sufficient to meet the temperature and humidity

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targets described in Items 4(a) and 4(b) of Exhibit “F”. Except as expressly set forth in this Section 7.2.2, Tenant shall be solely responsible for all emergency, supplemental or back-up HVAC systems (“Supplemental HVAC”) for use in the Tenant Space.

7.3 Interruption of Services.

7.3.1 Landlord shall not be liable or responsible to Tenant for any loss, damage or expense of any type which Tenant may sustain or incur if the quantity or character of the utility provided electric service is changed, is no longer available, or is no longer suitable for Tenant’s requirements. No interruption or malfunction of any electrical or other service (including, without limitation, heating ventilation and air conditioning “HVAC”) to the Tenant Space (or to any other portion of the Building or Property) shall, in any event, (i) constitute an eviction or disturbance of Tenant’s use and possession of the Tenant Space, (ii) constitute a breach by Landlord of any of Landlord’s obligations under this Lease, (iii) render Landlord liable for damages of any type or entitle Tenant to be relieved from any of Tenant’s obligations under this Lease (including the obligation to pay Base Rent, Additional Rent, or other charges), (iv) grant Tenant any right of setoff or recoupment, (v) provide Tenant with any right to terminate this Lease, or (vi) make Landlord liable for any injury to or interference with Tenant’s business or any punitive, incidental or consequential damages (of any type), whether foreseeable or not, whether arising from or relating to the making of or failure to make any repairs, alterations or improvements, or whether arising from or related to the provision of or failure to provide for or to restore any service in or to any portion of the Property, the Building or the Datacenter. In the event of any interruption, however, Landlord shall employ commercially reasonable efforts to restore such service or cause the same to be restored in any circumstances in which such restoration is within the reasonable control of Landlord and the interruption at issue was not caused in whole or in part by any action of Tenant.

7.3.2 Notwithstanding the foregoing, in the event that (a) there is an interruption of Landlord’s services, including, but not limited to (i) any interruption of any electrical or other service (including, without limitation, HVAC) to the Tenant Space, or (ii) a violation of the service levels described in Exhibit “F”, attached hereto, in the Tenant Space, (b) such interruption of Landlord’s services is not caused by any act or omission of Tenant or Tenant’s employees, agents, invitees or contractors, nor by a Casualty (as defined in Section 9.1.1, below), and (c) Tenant is prevented from using (and actually does not use) the Tenant Space, or any portion thereof, in the ordinary course of Tenant’s business, as determined by Tenant, for a period in excess of the timeframe specified in Item 15 of the Basic Lease Information (the “Eligibility Period”) because of the interruption of Landlord’s services (such an interruption, an “Interruption of Landlord’s Services”), Tenant shall, as its exclusive remedy therefor, be entitled to an abatement of Rent as set forth in Item 15 of the Basic Lease Information.

7.3.3 In addition to Tenant’s right to abatement of Base Rent, in the event a Chronic Outage (as hereinafter defined) occurs, Tenant may terminate this Lease by delivering to Landlord within five (5) business days following the occurrence of the Chronic Outage, written notice (“Tenant’s Chronic Outage Termination Notice”) of such termination. In the event of Tenant’s Chronic Outage termination, Landlord and Tenant agree that Tenant shall be permitted to continue its tenancy of the Tenant Space for one hundred eighty (180) days after the date of Landlord’s receipt of Tenant’s Chronic Outage Termination Notice (such period of Tenant’s “post-Chronic Outage termination tenancy” is referred to herein as “Tenant’s Chronic Outage Termination Period”); provided, however, that, (a) during Tenant’s Chronic Outage Termination Period, all of the terms of this Lease shall continue in full force and effect (including the default and remedy provisions contained herein), and (b) Tenant shall have the right to terminate Tenant’s Chronic Outage Termination Period, prior to the one hundred eightieth (180^th) day thereof, by providing ninety (90) days’ written notice of such early termination to Landlord (“Tenant’s 2^nd Chronic Outage Termination Notice”), in which case Tenant’s Chronic Outage Termination Period shall expire upon the earlier to occur of (i) the one hundred eightieth (180^th) day after the date of Landlord’s receipt of Tenant’s Chronic Outage Termination Notice; and (ii) the ninetieth (90^th) day after the date of Landlord’s receipt of Tenant’s 2^nd Chronic Outage Termination Notice. Tenant’s failure to timely deliver Tenant’s Chronic Outage Termination Notice shall automatically extinguish Tenant’s right to terminate this Lease with respect to that particular Chronic Outage. As used herein the term “Chronic Outage” means that

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three (3) or more times within a twelve (12) consecutive month period, there occurs an Interruption of Landlord’s Services, each occurrence of which continues for twelve (12) or more consecutive hours, regardless of whether or not such Interruption of Landlord’s Services was caused by Force Majeure.

7.3.4 In addition to Tenant’s right to abatement of Base Rent, in the event a Continuous Outage (as hereinafter defined) occurs, Tenant may terminate this Lease by delivering to Landlord within five (5) business days following the occurrence of the Continuous Outage, written notice (“Tenant’s Continuous Outage Termination Notice”) of such termination. In the event of Tenant’s Continuous Outage termination, Landlord and Tenant agree that Tenant shall be permitted to continue its tenancy of the Tenant Space for one hundred eighty (180) days after the date of Landlord’s receipt of Tenant’s Continuous Outage Termination Notice (such period of Tenant’s “post-Continuous Outage termination tenancy” is referred to herein as “Tenant’s Continuous Outage Termination Period”); provided, however, that, (a) during Tenant’s Continuous Outage Termination Period, all of the terms of this Lease shall continue in full force and effect (including the default and remedy provisions contained herein), and (b) Tenant shall have the right to terminate Tenant’s Continuous Outage Termination Period, prior to the one hundred eightieth (180^th) day thereof, by providing ninety (90) days’ written notice of such early termination to Landlord (“Tenant’s 2^nd Continuous Outage Termination Notice”), in which case Tenant’s Continuous Outage Termination Period shall expire upon the earlier to occur of (i) the one hundred eightieth (180^th) day after the date of Landlord’s receipt of Tenant’s Continuous Outage Termination Notice; and (ii) the ninetieth (90^th) day after the date of Landlord’s receipt of Tenant’s 2^nd Continuous Outage Termination Notice. Tenant’s failure to timely deliver Tenant’s Continuous Outage Termination Notice shall automatically extinguish Tenant’s right to terminate this Lease with respect to that particular Continuous Outage. As used herein the term “Continuous Outage” means an Interruption of Landlord’s Services occurs and continues for thirty (30) consecutive days, regardless of whether or not such Interruption of Landlord’s Services was caused by Force Majeure.

8. MAINTENANCE; ALTERATIONS.

8.1 Landlord Maintenance. Except as provided in this Section 8.1, Landlord shall have no obligation to repair and/or maintain the Tenant Space. Landlord will maintain and keep in clean and safe condition, and good order and repair, the Cage, Pathway, any Additional Pathway and shared Pathway (including dark fiber(s)) and the Datacenter, including, the Datacenter common area, Landlord’s Access Control Systems, HVAC, UPS plant, DC plant (if any), Back-up Power, fire suppression systems, common area cable management systems comprised of ladder racks, fiber trays, under-floor cable trays and other similar equipment installed for the benefit of all tenants of the Datacenter, floors and walls, foundation, exterior walls and roof of the Building, the public areas within the Building, and all common Building Systems, including without limitation, the heating, air conditioning and ventilation system within the Building. Landlord shall use commercially reasonable efforts to, (i) maintain battery capacity in the UPS plant for Tenant UPS power and the DC plant for DC power (if any), as specified in Item 2 of Exhibit “F”, (ii) maintain Datacenter temperature within the range specified in Item 4(a) of Exhibit “F”, (iii) maintain Datacenter relative humidity within the range specified in Item 4(b) of Exhibit “F”, and (iv) maintain PDUs serving the Tenant Space. In the event of an interruption of electrical service to the Premises, Landlord shall reasonably promptly thereafter contract with a third party vendor to provide fuel to the fuel tanks of the Back-up Power systems for the duration of such interruption. The cost thereof shall be borne by Tenant if such interruption or failure was caused by any act or omission of Tenant or Tenant’s employees, agents, invitees or contractors.

8.2 Tenant’s Maintenance. During the Term of this Lease, Tenant shall, at Tenant’s sole cost and expense, maintain the Tenant Space and Tenant’s equipment therein and in the Datacenter Connection Area, if any, in a clean and safe condition and in good order (and in at least as good order and clean condition as when Tenant took possession), ordinary wear and tear excepted. If Tenant fails to perform its covenants of maintenance and repair hereunder, or if Tenant or any of Tenant’s technicians or representatives physically damages the Property, the Building, the Datacenter, the Datacenter Connection Area, or any portion of any of the above, or the personal property of any other tenant or occupant, Landlord may, but shall not be obligated to, perform all necessary or appropriate maintenance and repair, and any

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amounts expended by Landlord in connection therewith, plus an administrative charge of ten percent (10%), shall be reimbursed by Tenant to Landlord as Additional Rent within thirty (30) days after Landlord’s demand therefor. Aside from Tenant’s equipment, if any, in the Datacenter Connection Area, Tenant shall have no obligation to maintain or repair the Datacenter Connection Area.

8.3 Alterations. Notwithstanding any provision in this Lease to the contrary, Tenant shall not make or cause to be made any alterations, additions, improvements or replacements to the Tenant Space, the Datacenter, or any other portion of the Building or Property (collectively, “Alterations”) without the prior written consent and approval of Landlord, which consent and approval may be withheld, conditioned or delayed in Landlord’s sole and absolute discretion; provided, however, that Landlord’s consent shall not be required for any usual and customary installations, repairs, maintenance, and removals of equipment and telecommunication cables within the Tenant Space if and to the extent that such installations, repairs, maintenance, and removals (i) are usual and customary within the industry, (ii) are of a type and extent which are customarily permitted to be made without consent by landlords acting consistently with Institutional Owner Practices (defined below) leasing similar space for similar uses to similar tenants, (iii) are in compliance with the Datacenter Rules and Regulations, and (iv) will not affect the Building’s structure, the provision of services to other Building tenants, or the Building’s electrical, plumbing, HVAC, life safety or mechanical systems. For example, Landlord’s consent would be required for the installation of overhead ladder racks that are attached to the ceiling and Landlord’s consent would not be required for the installation of equipment which does not involve drilling into the floor or ceiling. For purposes hereof, “Institutional Owner Practices” shall mean practices that are consistent with the practices of the majority of the institutional owners of institutional grade, first-class datacenter or telecommunications projects in the United States of America. Additionally, Landlord and Tenant agree that, Landlord shall provided its consent (or objections) with regard to Tenant’s requests for Alterations consent within ten (10) business days after Landlord’s receipt of such request. In the event that Landlord has failed to provide its consent (or objections) within the prescribed ten (10) business day period, as applicable, Landlord will be deemed to have consented with regard to the applicable request for Alterations consent; provided that (i) such request for Alterations consent contains the phrase “DATED MATERIAL ENCLOSED. RESPONSE IS REQUIRED WITHIN TEN BUSINESS DAYS AFTER LANDLORD’S RECEIPT HEREOF”, in all capital letters (no smaller than sixteen (16) point font) on the outside of the package in which such request for Alterations consent is provided to Landlord; (ii) such request for Alterations consent contains three (3) full sets of drawings (two full size hard copies, and one full set of drawings on CD); and (iii) in the event that Landlord has not responded within such ten (10) business day period, Tenant agrees to provide Landlord one (1) additional written notice (the “2^nd Alterations Consent Notice”) and one (1) additional business day following such 2^nd Alterations Consent Notice in which to respond, prior to such deemed consent taking effect.

8.4 Removal of Cable, Wiring, Connecting Lines, Equipment and Personal Property. Tenant agrees that, upon the expiration or earlier termination of this Lease, Tenant (or, failing which, a contractor designated by Landlord) shall at Tenant’s sole cost and expense, promptly remove all of Tenant’s Personal Property (defined below), and shall restore those portions of the Building, the Datacenter and/or the Tenant Space damaged by such removal of (or by the initial installation of) such Tenant’s Personal Property to their condition immediately prior to the installation or placement of such items. If Tenant fails to promptly remove any such Tenant’s Personal Property pursuant to this Section 8.4, Landlord shall have the right to remove such Tenant’s Personal Property and to restore those portions of the Building, the Datacenter, and/or the Tenant Space damaged by such removal to their condition immediately prior to the installation or placement of such Tenant’s Personal Property, in which case Tenant agrees to reimburse Landlord within thirty (30) days of Landlord’s demand therefor, for all of Landlord’s costs of removal and restoration plus an administrative fee equal to ten percent (10%) of such cost. For purposes hereof, “Tenant’s Personal Property” shall mean, collectively, all cable, wiring, connecting lines, and other installations, equipment or property installed or placed by or for on behalf of Tenant anywhere in the Building, the Datacenter, and/or the Tenant Space.

9. CASUALTY; EMINENT DOMAIN; INSURANCE.

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9.1 Casualty; Eminent Domain.

9.1.1 If at any time during the Term of this Lease, a material portion of the Property, the Building, the Datacenter or the Tenant Space shall be (i) damaged or destroyed by fire or other casualty (a “Casualty”), or (ii) taken under the power of eminent domain or condemned by any competent authority for any public or quasi-public use or purpose, or sold to prevent the exercise thereof (a “Taking”), so that, in either case, the use of the Tenant Space is materially impaired, then Landlord shall have the right to elect, in Landlord’s sole and absolute discretion, to either (a) terminate this Lease by delivery of written notice (a “Termination Notice”) thereof to Tenant or (b) to continue this Lease, in which case, Landlord shall repair and reconstruct the Tenant Space and the Datacenter to substantially the same condition in which they existed immediately prior to such Casualty or Taking. Notwithstanding the foregoing, Landlord shall have no right to terminate the Lease due to Casualty or Taking unless it also terminates the Leases of all other tenants of the Building similarly affected by the Casualty or Taking. If as a result of the Casualty, the Tenant Space is unfit for use by Tenant in the ordinary conduct of Tenant’s business and actually is not used by Tenant in the ordinary conduct of Tenant’s business (which, for the avoidance of doubt, and for the purposes of this Lease, means the operation of Tenant’s business in the affected portion of the Tenant Space is adversely impacted), then Landlord shall provide written notice (the “Restoration Notice”) to Tenant as soon as practicable after the Casualty of the period of time (the “Stated Restoration Period”) which shall be required for the repair and restoration of the Building to permit use of the Tenant Space in the ordinary conduct of Tenant’s business and Tenant shall have the right, at its election, to terminate this Lease if either (i) the Stated Restoration Period shall be in excess of ninety (90) days following the Casualty and Tenant terminates this Lease with written notice thereof to Landlord within ten (10) days following delivery of the Restoration Notice, or (ii) Landlord shall fail within the Stated Restoration Period to complete the repair and restoration of the Building necessary to allow Tenant’s use of the Tenant Space in the ordinary conduct of Tenant’s business and Tenant delivers written notice of such termination to Landlord within thirty (30) days following the expiration of the restoration deadline.

9.1.2 Base Rent Abatement. In the event that this Lease is terminated as herein permitted, Landlord shall refund to Tenant any prepaid Base Rent less any sum then owing Landlord by Tenant. Landlord shall not be obligated to carry insurance on Tenant’s personal property within the Tenant Space. If this Lease is not terminated in pursuant to Section 9.1.1 above, Base Rent shall abate proportionately during the period and to the extent that the Tenant Space is unfit for use by Tenant in the ordinary conduct of Tenant’s business and actually is not used by Tenant in the ordinary conduct of Tenant’s business, this Lease shall continue in full force and effect, and such repairs shall be made within the time periods set forth in Section 9.1.1 above, subject to delay caused by Force Majeure.

9.1.3 Tenant’s Remedy. Tenant’s termination right and Base Rent abatement, to the extent provided above in this Article 9, shall be Tenant’s sole remedies in the event of a Casualty or Taking, and Tenant shall not be entitled to any compensation or damages for loss of, or interference with, Tenant’s business or use or access of all or any part of the Tenant Space resulting from any such damage, repair, reconstruction or restoration; provided, however, that notwithstanding anything to the contrary herein, if any Casualty is caused by any negligent act or omission or act of willful misconduct of Tenant or any Tenant Party, Tenant shall not be entitled to terminate this Lease under Section 9.1.1 and there shall be no abatement of any Base Rent (or any other Rent or other amounts) due hereunder.

9.1.4 Waiver. Landlord and Tenant agree that the provisions of this Article 9 and the remaining provisions of this Lease shall exclusively govern the rights and obligations of the parties with respect to any and all damage to, or destruction of, all or any portion of the Tenant Space, the Building or the Property, and/or any Taking thereof, and each Landlord and Tenant hereby waive and release each and all of their respective common law and statutory rights inconsistent herewith, whether now or hereinafter in effect.

9.2 Tenant’s Insurance. Tenant shall, at Tenant’s expense, procure and maintain throughout the Term of this Lease a policy or policies of insurance in accordance with the terms and requirements set forth in Exhibit “B” to this Lease. Tenant hereby waives its rights against the Landlord Group (defined in

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Item 24 of the Basic Lease Information) with respect to any claims or damages or losses (including any claims for bodily injury to persons and/or damage to property) which are caused by or result from (i) risks insured against under any insurance policy carried by Tenant at the time of such claim, damage, loss or injury, or (ii) risks which would have been covered under any insurance required to be obtained and maintained by Tenant under this Lease had such insurance been obtained and maintained as required; provided, however, that in no event shall Tenant be deemed to have waived its right against Landlord with respect to any claims or damages or losses (including any claims for bodily injury to persons and/or damage to property) which are caused by or result from the gross negligence or willful misconduct of any member of the Landlord Group. The foregoing waivers shall be in addition to, and not a limitation of, any other waivers or releases contained in this Lease and shall survive expiration or earlier termination of this Lease. All of Tenant’s insurance policies shall be endorsed so as to include a waiver of subrogation with and to the full extent of Tenant’s waiver of claims above.

9.3 Landlord’s Insurance. Landlord shall, at Landlord’s expense, procure and maintain throughout the Term of this Lease a policy or policies of insurance insuring the Building and the Property and all of Landlord’s equipment and fixtures installed therein against loss due to fire and other casualties included in standard extended coverage insurance policies, in an amount equal to the replacement cost thereof. Landlord shall also maintain such insurance as is customarily carried by reasonably prudent landlords of datacenters in the city in which the Property is located. All insurance required under this Lease shall be issued by insurers with a “General Policyholders Rating” of at least A-, VIII, as set forth in “Best’s Insurance Guide.” Such insurers shall be authorized to do business in the state in which the Property is located. Landlord hereby waives its rights against Tenant with respect to any claims or damages or losses (including any claims for bodily injury to persons and/or damage to property) which are caused by or result from (i) risks insured against under any insurance policy carried by Landlord at the time of such claim, damage, loss or injury, or (ii) risks which would have been covered under any insurance required to be obtained and maintained by Landlord under this Lease had such insurance been obtained and maintained as required; provided, however, that in no event shall Landlord be deemed to have waived its rights against Tenant with respect to any claims or damages or losses (including any claims for bodily injury to persons and/or damage to property) which are caused by or result from the negligence or willful misconduct of Tenant and/or the Tenant Parties, as defined in Section 14.2 below. The foregoing waivers shall be in addition to, and not a limitation of, any other waivers or releases contained in this Lease. All of Landlord’s insurance policies shall be endorsed so as to include a waiver of subrogation with and to the full extent of Landlord’s waiver of claims above.

10. ASSIGNMENT AND SUBLETTING.

10.1 Restrictions on Transfers; Landlord’s Consent. Tenant shall not sublease all or any part of the Tenant Space, nor assign this Lease, nor enter any other agreement (a) permitting a third party (other than Tenant, Tenant Parties or Tenant’s occasional guests) to occupy or use any portion of the Tenant Space or (b) otherwise assigning, transferring, mortgaging, pledging, hypothecating, encumbering or permitting a lien to attach to its interest under this Lease (any such assignment, sublease or the like may sometimes be referred to herein as a “Transfer” and any person or entity to whom a Transfer is made or sought to be made is referred to herein as a “Transferee”), without Landlord’s express prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed. No Transfer (whether voluntary, involuntary or by operation of law) shall be valid or effective without Landlord’s prior written consent and, at Landlord’s election, any Transfer or attempted Transfer shall constitute an Event of Default of this Lease. Except as set forth in Section 10.5, below, Tenant expressly covenants and agrees not to enter into (and acknowledges and agrees that it has no right to enter into) any Transfer which expressly, implicitly, or effectively amounts to or is the equivalent of a sublease or other arrangement which creates a co-location between Tenant and any Transferee (any such Transfer a “Sub-Co-location Arrangement”) without the prior written consent of Landlord which, in such circumstances, may be granted or withheld by Landlord for any reason or for no reason in the exercise of Landlord’s sole and absolute discretion (and Tenant agrees that it shall be reasonable for Landlord to withhold its consent to any Transfer which would amount to or create the equivalent of a Sub-Co-location Arrangement).

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10.1.1 Permitted Transfer. Notwithstanding anything to the contrary in this Lease, Tenant may, without the consent of Landlord (and without being subject to Landlord’s rights under Section 10.3, below) (a) undertake the transfer or assignment of interests in Tenant, including, without limitation, the transfer of any or all of the outstanding voting or non-voting stock or the issuance of new shares of voting or non-voting stock of Tenant which shall not be deemed an assignment of this Lease provided such action is taken pursuant to a bona fide business transaction and not principally or exclusively as a means to evade the consent requirements under this Lease and further provided that the credit of the Tenant under this Lease after such acquisition is deemed to be sufficient in Landlord’s sole reasonable determination; and/or (b) effect Affiliate Transfers (as defined below) (in either event, a “Permitted Transfer”). An “Affiliate Transfer” means (i) an assignment by Tenant of this Lease to a Tenant Affiliate (as defined below), or (ii) an assignment by Tenant of this Lease in connection with a corporate reorganization provided the board of directors of the entity resulting from such corporate reorganization is controlled by directors representing the interests of the undersigned Tenant as it existed prior to such reorganization, if (x) Tenant gives Landlord prior written notice of the name of any such assignee, (y) the assignee assumes, in writing, for the benefit of Landlord all of Tenant’s obligations under this Lease, and (z) (except in the case of an assignment to a Tenant Affiliate) the credit of the surviving or created entity is deemed to be sufficient in Landlord’s sole reasonable determination. The term “Tenant Affiliate” as used herein shall mean any partnership, limited liability company, or corporation or other entity, directly or indirectly, which through one or more intermediaries, controls, is controlled by, or is under common control with Tenant. The term “control”, as used in the immediately preceding sentence shall mean with respect to a corporation the right to exercise, directly or indirectly, fifty percent (50%) or more of the voting rights attributable to the controlled corporation or the power to elect a majority of its Board of Directors.

10.2 Notice to Landlord. If Tenant desires to make any Transfer (other than a Permitted Transfer, for which Tenant must notify Landlord within twenty (20) days after the occurrence of same), then at least ten (10) days (but no more than one hundred eighty (180) days) prior to the proposed effective date of the proposed Transfer, Tenant shall submit to Landlord a written request (a “Transfer Notice”) for Landlord’s consent, which notice shall include: (i) a statement containing: (a) the name and address of the proposed Transferee; (b) current, certified financial statements of the proposed Transferee, and any other information and materials (including, without limitation, credit reports, business plans, operating history, bank and character references) reasonably required by Landlord to assist Landlord in reviewing the financial responsibility, character, and reputation of the proposed Transferee; (c) all of the principal terms of the proposed Transfer; and (d) such other information and materials as Landlord may reasonably request (and if Landlord requests such additional information or materials, the Transfer Notice shall not be deemed to have been received until Landlord receives such additional information or materials) and (ii) four (4) originals of the proposed assignment or other Transfer on a form reasonably approved by Landlord and four (4) originals of the Landlord’s standard form of “Assignment and Assumption of Lease and Consent” or other Transfer documentation executed by Tenant and the proposed Transferee. If Tenant materially modifies any of the terms and conditions relevant to a proposed Transfer specified in the Transfer Notice, Tenant shall re-submit such Transfer Notice to Landlord for its consent pursuant to all of the terms and conditions of this Article 10.

10.3 Landlord’s Recapture Rights. Except with regard to a Permitted Transfer, at any time within twenty (20) business days after Landlord’s receipt of all (but not less than all) of the information and documents described in Section 10.2, Landlord shall have the right (but no obligation), exercisable by written notice to Tenant, to elect to cancel and terminate this Lease.

10.4 No Release; Subsequent Transfers. No Transfer (whether or not a Permitted Transfer) will release Tenant from Tenant’s obligations under this Lease or alter the primary liability of Tenant to pay the Rent and to perform all other obligations to be performed by Tenant hereunder. In no event shall the acceptance of any payment by Landlord from any other person be deemed to be a waiver by Landlord of any provision hereof. Consent by Landlord to one Transfer will not be deemed consent to any subsequent Transfer. In the event of breach by any Transferee of Tenant or any successor of Tenant in the performance of any of the terms hereof, Landlord may proceed directly against Tenant without the necessity of exhausting remedies against such Transferee or successor. The voluntary or other surrender of

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this Lease by Tenant or a mutual termination thereof shall not work as a merger and shall, at the option of Landlord, either (i) terminate all and any existing agreements effecting a Transfer, or (ii) operate as an assignment to Landlord of Tenant’s interest under any or all such agreements

10.5 Colocation. Landlord acknowledges that the business to be conducted by the undersigned Tenant in the Premises requires the installation of certain equipment (described below) owned by customers or co-locators of the undersigned Tenant (“Permitted Licensees”) in (but not outside of) the Premises, in order for the Permitted Licensees to place and maintain computer, switch and/or communications equipment which may interconnect with Tenant’s facilities and/or the Permitted Licensees’ facilities (the “Permitted Interconnection”). To expedite the Permitted Licensees’ access to the Premises for the Permitted Interconnection, Landlord expressly agrees that Tenant may, without Landlord’s further consent, license portions of the Premises to the Permitted Licensees for the sole purpose of the Permitted Interconnection pursuant to written agreements by and between Tenant and the Permitted Licensees (collectively, “Permitted Agreements”); provided, however, that (a) Tenant provides a list of contact information for such Permitted Licensees in a format that Landlord may reasonably alter from time-to-time, and (b) each Permitted Licensee’s license of a portion of the Premises may not violate any terms of this Lease or any Applicable Laws. Landlord expressly waives any right to prior review of such Permitted Agreements. Tenant’s Permitted Agreements with the Permitted Licensees may not affect, or provide any rights with respect to or to use in any manner, the Additional Pathway as defined in Item 7 of the Basic Lease Information or Tenant’s interconnections. The Permitted Licensees shall comply with all Applicable Laws and the Datacenter Rules and Regulations. The Permitted Agreements and the Permitted Licensees’ rights thereunder shall be subject and subordinate at all times to the Lease and all of its provisions, covenants and conditions. Tenant hereby agrees to indemnify, defend, and hold harmless Landlord and the Landlord Group from and against (and to reimburse Landlord and the Landlord Group) for any and all Claims (defined in Section 14.2, below) arising from or in any manner relating to (i) any Permitted Agreement, (ii) the use or occupancy of the Tenant Space or any other portion of the Building or the Property by any Permitted Licensee or any person claiming by, through or under any Permitted Licensee, its partners, and their respective officers, agents, servants or employees of Tenant or any such person (collectively, the “Colocating Parties”) pursuant to any Permitted Agreement, (ii) the acts or omissions of any Permitted Licensee or any Colocating Parties pursuant to any Permitted Agreement.

11. ESTOPPEL CERTIFICATE BY TENANT. At any time and from time to time, within ten (10) business days after written request by Landlord, Tenant shall execute, acknowledge and deliver to Landlord a statement in writing certifying all matters reasonably requested by Landlord or any current or prospective purchaser, Holder (as defined in Section 12.1 below) of any Security Document (as defined in Section 12.1 below), ground lessor or master lessor. Tenant acknowledges and agrees that it understands that any statement delivered (or to be delivered) pursuant to this Article 11 may be relied upon by any prospective purchaser of the Building or the Property or by any prospective mortgagee, ground lessor or other like encumbrancer thereof or any assignee of any such encumbrance upon the Building or the Property. Tenant’s failure to deliver the statement within the ten (10) business day period specified above shall be conclusive and binding upon Tenant with respect to a third party that the Lease is in full force and effect without modification except as may be represented by Landlord, that there are no uncured defaults in Landlord’s performance and that Tenant has no right of offset, counterclaim or deduction against any fees or other charges due Landlord hereunder, and that no more than one month’s fees or other charges due hereunder have been paid in advance.

12. SUBORDINATION AND ATTORNMENT; LENDER RIGHTS.

12.1 Subordination and Attornment. Without the necessity of any additional document being executed by Tenant for the purpose of effecting a subordination, and at the election of Landlord or any mortgagee or beneficiary with a mortgage or deed of trust encumbering the Property or any portion thereof, or any lessor of a ground or underlying lease with respect to the Property or any portion thereof (any such mortgagee, beneficiary or lessor, a “Holder”), this Lease will be subject and subordinate at all times to: (i) all ground leases or underlying leases which may now exist or hereafter be executed affecting the Property; (ii) the lien of any mortgage, deed or deed of trust which may now exist or hereafter be

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executed affecting the Property or any portion thereof; (iii) all past and future advances made under any such mortgages, deeds or deeds of trust; and (iv) all renewals, modifications, replacements and extensions of any such ground leases, master leases, mortgages, deed and deeds of trust (collectively, “Security Documents”) which may now exist or hereafter be executed which constitute a lien upon or affect the Property or any portion thereof, or Landlord’s interest and estate in any of said items. Notwithstanding the foregoing, Landlord reserves the right to subordinate any such Security Documents to this Lease. In the event of any termination or transfer of Landlord’s estate or interest in the Property, the Building, the Datacenter or the Tenant Space by reason of any termination or foreclosure of any such Security Documents (and notwithstanding any subordination of such Security Document to this Lease that may or may not have occurred), at the election of Landlord’s successor in interest, Tenant agrees to attorn to and become the tenant of such successor, in which event Tenant’s right to possession of the Property will not be disturbed as long as Tenant is not in default under this Lease. Tenant hereby waives any right under any Applicable Law or otherwise to terminate or otherwise adversely affect this Lease and the obligations of Tenant hereunder in the event of any termination or transfer of Landlord’s estate or interest in the Property, the Building, the Datacenter or the Tenant Space by reason of any termination or foreclosure of any such Security Documents. Tenant covenants and agrees to execute and deliver, within ten (10) business days of receipt thereof, and in the form reasonably required by Landlord or in the standard form required by any Holder, any additional documents evidencing the priority or subordination of this Lease and Tenant’s agreement to attorn with respect to any such Security Document; provided, however, any such agreement subordinating this Lease to such lease, mortgage or deed of trust shall contain a nondisturbance provision in the standard form of such Holder.

12.2 Mortgagee and Ground Lessor Protection. Tenant agrees to give each Holder, by registered or certified mail, a copy of any notice of default served upon the Landlord by Tenant, provided that prior to such notice Tenant has been notified in writing of the address of such Holder (hereafter, a “Noticed Holder”). Tenant further agrees that if Landlord shall have failed to cure such default within thirty (30) days after such notice to Landlord (or if such default cannot be cured or corrected within that time, then within such additional time as may be necessary if Landlord has commenced such cure within such thirty (30) days and is diligently pursuing the remedies or steps necessary to cure or correct such default), then prior to Tenant pursuing any remedy for such default provided hereunder, at law or in equity, any Noticed Holder shall have an additional thirty (30) days within which to cure or correct such default (or if such default cannot reasonably be cured or corrected within that time, then such additional time as may be necessary if the Noticed Holder has commenced within such thirty (30) days and is diligently pursuing the remedies or steps necessary to cure or correct such default).

12.3 SNDA. At any time that the Building is made subject to any Security Document(s), Landlord shall use commercially reasonable good faith efforts to cause the mortgagee and any lessor (whether under a ground or master lease) to deliver to Tenant a subordination, attornment and non-disturbance agreement reasonably acceptable to Tenant (the “SNDA”), providing that so long as Tenant is not in default under this Lease after the expiration of any applicable notice and cure periods, Tenant may remain in possession of the Tenant Space under the terms of this Lease, even if the mortgagee or its successor should acquire Landlord’s title to the Building. Notwithstanding anything herein to the contrary, the subordination of this Lease to any Security Document now or hereafter placed upon the Building and Tenant’s agreement to attorn to the Holder as provided in this Section 12 shall be conditioned upon the Holder providing Tenant with a commercially reasonable SNDA.

13. SURRENDER OF TENANT SPACE; HOLDING OVER.

13.1 Tenant’s Method of Surrender. Upon the expiration of the Term of this Lease, or upon any earlier termination of this Lease or the termination of Tenant’s right to possess the Tenant Space, Tenant shall, subject to the provisions of this Article 13 and Section 8.4, quit and surrender possession of the Tenant Space to Landlord in the same condition as received, reasonable wear and tear excepted. If Tenant fails to surrender the Tenant Space upon the expiration or any earlier termination of this Lease or the termination of Tenant’s right to possess the Tenant Space in accordance with the terms of this Lease, then Tenant shall indemnify, protect, defend and hold the Landlord Group harmless from, and shall

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reimburse Landlord for its first-party losses, costs and expenses in connection with, all Claims (including, without limitation, costs and expenses incurred by Landlord in returning the Tenant Space to the condition in which Tenant was to surrender and Claims made by any succeeding tenant founded on or resulting from Tenant’s failure to surrender the Tenant Space) arising out of or in any manner relating to such failure to quit and surrender possession of the Tenant Space to Landlord in the condition required hereunder upon such date.

13.2 Disposal of Tenant’s Personal Property. If any property not belonging to Landlord remains in the Tenant Space after the expiration of or within thirty (30) days after any earlier termination of the Term of this Lease or the termination of Tenant’s right to possess the Tenant Space, Tenant shall be deemed to have abandoned such property and to have authorized Landlord to make such disposition of such property as Landlord may desire without liability for compensation or damages to Tenant in the event that such property is the property of Tenant; and in the event that such property is the property of someone other than Tenant, Tenant shall indemnify and hold the Landlord Group harmless from all Claims arising out of, in connection with, or in any manner related to any removal, exercise or dominion over and/or disposition of such property by Landlord. The foregoing indemnity shall not apply to any lender of Tenant’s with whom Landlord has entered into an agreement regarding the disposal of personal property in situations where Landlord has breached its obligations under such agreement with such lender; in such cases, the terms of the agreement between Landlord and Tenant’s lender shall control.

13.3 Holding Over. If Tenant should remain in possession of all or any portion of the Tenant Space after the expiration of the Term of this Lease (or any earlier termination of this Lease or the termination of Tenant’s right to possess the Tenant Space), without the execution by Landlord and Tenant of a new lease or an extension of the Term of this Lease, then Tenant shall be deemed to be occupying the entire Tenant Space as a tenant-at-sufferance, upon all of the terms contained herein, except as to term and Base Rent and any other provision reasonably determined by Landlord to be inapplicable. During any such holdover period, Tenant shall pay to Landlord a monthly Base Rent in an amount equal to two hundred percent (200%) of the Base Rent and Additional Rent payable by Tenant to Landlord during the last month of the Term of this Lease. The monthly rent payable for such holdover period shall in no event be construed as a penalty or as liquidated damages for such retention of possession. Neither any provision hereof nor any acceptance by Landlord of any rent after any such expiration or earlier termination shall be deemed a consent to any holdover hereunder or result in a renewal of this Lease or an extension of the Term, or any waiver of any of Landlord’s rights or remedies with respect to such holdover. Notwithstanding any provision to the contrary contained herein, (a) Landlord expressly reserves the right to require Tenant to surrender possession of the Tenant Space upon the expiration of the Term of this Lease or upon the earlier termination hereof or at any time during any holdover and the right to assert any remedy at law or in equity to evict Tenant and collect damages in connection with any such holdover, and (b) Tenant shall indemnify, defend and hold the Landlord Group harmless from and against any and all Claims (excluding all lost profits and other consequential damages), attorneys’ fees, consultants’ fees and court costs incurred or suffered by or asserted against Landlord arising out of or in any manner related to Tenant’s failure to surrender the Tenant Space upon the expiration or earlier termination of this Lease or upon termination of Tenant’s right to possess the Tenant Space in accordance with the provisions of this Lease.

13.4 Survival. The provisions of this Article 13 shall survive the expiration or early termination of this Lease.

14. WAIVER OF CLAIMS; INDEMNITY.

14.1 Waiver. To the fullest extent permitted by law, Tenant, as a material part of the consideration to Landlord, hereby waives all claims it may have against the Landlord Group (as defined in the Basic Lease Information) for damage to or loss of property (including, without limitation, loss of profits and intangible property) or bodily injury or loss of life or other damages of any kind resulting from the Property, the Building, the Datacenter or the Tenant Space or any part thereof becoming out of repair, by reason of any repair or alteration thereof, or resulting from any accident within the Property, the Building,

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the Datacenter, the Datacenter Connection Area or the Tenant Space or on or about any space adjoining the same, or resulting directly or indirectly from any act or omission of any person, or due to any condition, design or defect of the Property, the Building, the Datacenter or the Tenant Space, or any space adjoining the same, or the mechanical systems of the Building or the Datacenter, which may exist or occur, whether such damage, loss or injury results from conditions arising upon the Tenant Space, the Datacenter Connection Area or upon other portions of the Datacenter or the Building, or from other sources or places, and regardless of whether the cause of such damage, loss or injury or the means of repairing the same is accessible to Tenant; provided, however, that such assumption and waiver shall not apply to the extent such claims proximately caused by the gross negligence or willful misconduct of any member of the Landlord Group. Tenant agrees that, except to the extent caused by Landlord’s gross negligence or will misconduct, Landlord will not have any responsibility or liability for any damage to Tenant’s equipment or interruption of Tenant’s operations which is caused by any other tenant or occupant of the Datacenter, the Building or the Property or the employees, agents, contractors, technicians, representatives, customers, co-locators or invitees of any such tenant or occupant.

14.2 Indemnification. Tenant hereby agrees to indemnify, defend, and hold harmless Landlord and the Landlord Group (as such term is defined in the Basic Lease Information) from and against (and to reimburse Landlord and the Landlord Group) for any and all claims, actions, suits, proceedings, losses, damages (including, without limitation, any form of Tenant and/or third party consequential damages), obligations, liabilities, penalties, fines, costs and expenses (including, without limitation, attorneys’ fees, legal costs, and other costs and expenses of defending against any claims, actions, suits, or proceedings) (collectively, “Claims”) arising from, in connection with, or in any manner relating to (or alleged to arise from, to be in connection with, or to be in any manner related to): (i) the use or occupancy of the Tenant Space or any portion of the Datacenter Connection Area, the Datacenter, the Building or the Property by Tenant or any person claiming by, through or under Tenant, its partners, and their respective officers, agents, servants or employees of Tenant or any such person (collectively, “Tenant Parties”) (not arising from the gross negligence or willful misconduct of Landlord or its employees, agents, contractors or invitees), (ii) the negligence or willful omissions of Tenant or any Tenant Parties with respect to the Tenant Space, the Building or the Property, or (iii) any default of this Lease by Tenant. In the event that any action or proceeding is brought against Landlord or any member of the Landlord Group by reason of any such Claim, Tenant upon notice from Landlord shall defend such action or proceeding at Tenant’s cost and expense by counsel reasonably approved by Landlord. Tenant’s obligations under this Section 14.2 shall survive the expiration or termination of this Lease as to any matters arising prior to such expiration or termination or prior to Tenant’s vacation of the Tenant Space and the Building. Notwithstanding any provision to the contrary contained in this Section 14.2, nothing contained in this Section 14.2 shall be interpreted or used in any way to affect, limit, reduce or abrogate any insurance coverage provided by any insurer to either Tenant or Landlord. This indemnity provision shall survive the termination or expiration of this Lease.

14.3 Consequential Damages. Under no circumstances whatsoever shall Landlord or Tenant be liable under this Lease for consequential damages or special damages. The foregoing notwithstanding, Landlord and Tenant acknowledge and agree that, in no event, shall the elevated Rent payable by Tenant to Landlord hereunder in connection with Section 13.3 be deemed to represent any form of consequential damages or special damages.

14.4 Liens. Notwithstanding anything to the contrary herein, in no event shall Tenant have any right (express or implied) to create or permit there to be established any lien or encumbrance of any nature against the Tenant Space, the Building or the Property or against Landlord’s or Tenant’s interest therein or hereunder, including, without limitation, for any improvement or improvements by Tenant, and Tenant shall fully pay the cost of any improvement or improvements made or contracted for by Tenant. Tenant shall require each contractor which it engages to perform any improvements or alterations within the Tenant Space or elsewhere in the Building or the Property, to acknowledge and agree in writing that it is performing its work under its agreement with Tenant solely for the benefit of Tenant and that Tenant is not acting as Landlord’s agent. Any mechanic’s lien filed against the Tenant Space, the Building or the Property, or any portion of any of the above, for work claimed to have been done, or materials claimed to

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have been furnished to Tenant, shall be duly discharged or bonded by Tenant within ten (10) days after notice of the filing of the lien.

14.5 Waiver of Landlord’s Lien. Landlord hereby expressly waives and releases any and all contractual liens and security interests or constitutional and/or statutory liens and security interests arising by operation of law to which Landlord might now or hereafter be entitled on the property of Tenant which Tenant now or hereafter places in or upon the Premises (except for judgment liens that may arise in favor of Landlord). The waiver and release contained herein shall not waive, release or otherwise affect any unsecured claim Landlord may have against Tenant.

15. TENANT DEFAULT.

15.1 Events of Default By Tenant. Each of the following acts or omissions of Tenant or occurrences shall constitute an “Event of Default”:

15.1.1 Any failure or refusal by Tenant to timely pay any Rent or any other payments or charges required to be paid hereunder, or any portion thereof, within three (3) days of notice that the same is due.

15.1.2 Any failure by Tenant to perform or observe any other covenant or condition of this Lease (including, without limitation, in the Datacenter Rules and Regulations) to be performed or observed by Tenant (other than those described in Section 15.1.1, above or Sections 15.1.3, 15.1.4, or 15.1.5, below) if such failure continues for a period of thirty (30) days following written notice to Tenant of such failure; provided, however, that in the event Tenant’s failure to perform or observe any covenant or condition of this Lease to be performed or observed by Tenant cannot reasonably be cured within thirty (30) days following written notice to Tenant, Tenant shall not be in default if Tenant commences to cure same within ten (10) days after Tenant’s receipt of written notice thereof and thereafter diligently prosecutes the curing thereof to completion.

15.1.3 The filing or execution or occurrence of any one of the following: (i) a petition in bankruptcy or other insolvency proceeding by or against Tenant, (ii) a petition or answer seeking relief under any provision of the Bankruptcy Act, (iii) an assignment for the benefit of creditors, (iv) a petition or other proceeding by or against Tenant for the appointment of a trustee, receiver or liquidator of Tenant or any of Tenant’s property, or (v) a proceeding by any governmental authority for the dissolution or liquidation of Tenant or any other instance whereby Tenant or any general partner of Tenant shall cease doing business as a going concern, where such petition, assignment or proceeding is not dismissed within sixty (60) days after filing.

15.1.4 Any failure by Tenant to execute and deliver any statement or document described in either Article 11 or Section 12.1 requested to be so executed and delivered by Landlord within the time periods specified therein applicable thereto, where such failure continues for three (3) days after delivery of written notice of such failure by Landlord to Tenant.

The parties hereto acknowledge and agree that all of the notice periods provided in this Section 15.1 are in lieu of, and not in addition to, the notice requirements of any Applicable Laws.

15.2 Remedies. Upon the occurrence of any Event of Default by Tenant, Landlord shall have, in addition to any other remedies available to Landlord at law or in equity, the option to pursue any one or more of the remedies described in Section 1 of Exhibit “D” attached hereto and incorporated herein by this reference, each and all of which shall, subject to applicable law, be cumulative and nonexclusive, without any notice or demand whatsoever (and all of the other provisions of Section 1 of Exhibit “D” shall apply to an Event of Default by Tenant hereunder).

16. LIMITATION OF LANDLORD’S LIABILITY.

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16.1 Landlord Default. In the event that Landlord shall fail to perform any obligation of Landlord to be performed under this Lease, Tenant’s sole and exclusive remedies for any such failure shall be an action for money damages, specific performance and/or injunctive relief (Tenant hereby waiving the benefit of any laws granting Tenant a lien upon the property of Landlord and/or upon rental due Landlord or granting Tenant a right to terminate this Lease upon a default by Landlord); provided, however, that Landlord shall not be in default hereunder (and Tenant shall have no right to pursue any such claim for damages in connection with any such failure) unless and until Tenant shall have delivered to Landlord a written notice specifying such default with particularity, and Landlord shall thereafter have failed to cure such default within thirty (30) days (or, if the nature of Landlord’s obligation is such that more than thirty (30) days are reasonably required for its performance, then not unless Landlord shall have failed to commence such performance of such cure within ten (10) days after its receipt of notice thereof from Tenant and thereafter diligently pursue the same to completion). In the event Landlord’s failure to perform an obligation of Landlord to be performed under this Lease materially adversely affects Tenant’s use of the Tenant Space for the Permitted Use, Landlord shall commence to cure such default within ten (10) business days following receipt of written notice from Tenant of such default, and in the event of an emergency, shall commence to cure such default within twenty-four (24) hours following receipt of written notice from Tenant of such default, and shall diligently pursue the curing thereof to completion. Unless and until Landlord shall have so failed to so cure any such failure after such notice, Tenant shall not have any remedy or cause of action by reason thereof. Except as expressly set forth in this Lease, in no event shall Tenant have the right to terminate the Lease nor shall Tenant’s obligation to pay Base Rent or other charges under this Lease abate based upon any default by Landlord of its obligations under the Lease.

16.2 Landlord’s Liability. In consideration of the benefits accruing under this Lease to Tenant and notwithstanding anything to the contrary in this Lease or in any exhibits, riders, amendments, or addenda to this Lease (collectively, the “Lease Documents”), it is expressly understood and agreed by and between the parties to this Lease that: (i) the recourse of Tenant or its successors or assigns against Landlord (and the liability of Landlord to Tenant, its successors and assigns) with respect to (a) any actual or alleged breach or breaches by or on the part of Landlord of any representation, warranty, covenant, undertaking or agreement contained in any of the Lease Documents, or (b) any matter relating to Tenant’s occupancy of the Tenant Space (collectively, the “Landlord’s Lease Undertakings”), shall be limited solely to an aggregate amount equal to $5,000,000.00; (ii) Tenant shall have no recourse against any other assets of the Landlord Group (as defined in the Basic Lease Information); (iii) except to the extent of Landlord’s interest in the Property, no personal liability or personal responsibility of any sort with respect to any of Landlord’s Lease Undertakings or any alleged breach thereof is assumed by, or shall at any time be asserted or enforceable against, the Landlord Group, and (iv) at no time shall Landlord be responsible or liable to Tenant for any lost profits, lost economic opportunities or any form of consequential damages as the result of any actual or alleged breach of Landlord of Landlord’s Lease Undertakings.

16.3 Transfer of Landlord’s Interest. Landlord shall have the right, from time to time, to assign its interest in this Lease in whole or, to a wholly owned subsidiary, in part. Notwithstanding the foregoing, in connection with any assignment in part to a wholly-owned subsidiary, (i) Landlord shall provide a written notice to Tenant specifying the rights and obligations so assigned and (ii) Landlord shall guaranty the performance of the obligations assigned to such wholly-owned subsidiary; provided, however, Landlord’s maximum liability under such guaranty shall not exceed the maximum liability it would have had under this Lease if such obligations had not been assigned. Landlord and each successor to Landlord shall be fully released from the performance of Landlord’s obligations under the Lease Documents upon their transfer of Landlord’s interest in the Property to a third party. Landlord shall not be liable for any obligation under the Lease Documents after a transfer of its interest in the Property and Tenant agrees to look solely to the successor in interest of Landlord in and to this Lease for all obligations and liabilities accruing on or after the date of such transfer. If any security has been given by Tenant to secure the faithful performance of any of the covenants of this Lease, Landlord may transfer or deliver said security, as such, to Landlord’s successor in interest and thereupon Landlord shall be discharged from any further liability with regard to said security.

17. MISCELLANEOUS.

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17.1 Severability. If any provision of this Lease is determined by any court of competent jurisdiction to be invalid or unenforceable to any extent, the remainder of this Lease shall not be affected thereby.

17.2 Performance. The covenants and obligations of Tenant pursuant to this Lease shall be independent of performance by Landlord of the covenants and obligations of Landlord pursuant to this Lease. Tenant’s performance of each of its obligations under this Lease shall be a condition precedent to the duty of Landlord to perform its obligations hereunder.

17.3 Attorneys’ Fees and Costs. If either Landlord or Tenant initiates any litigation, mediation, arbitration or other proceeding regarding the enforcement, construction or interpretation of this Lease, then the non-prevailing party shall pay the prevailing party’s attorneys’ fees and costs (including, without limitation, all expense reimbursements, expert witness fees and litigation costs). In addition, if it should otherwise be necessary or proper for Landlord to consult an attorney concerning this Lease for the review of instruments evidencing a proposed Transfer, for the purpose of collecting Rent, Tenant agrees to pay to Landlord its actual attorneys’ fees whether suit be brought or not to the extent such fees exceed $500.00.

17.4 Waiver of Right to Jury Trial. IN ORDER TO LIMIT THE COST OF RESOLVING ANY DISPUTES BETWEEN THE PARTIES, AND AS A MATERIAL INDUCEMENT TO EACH PARTY TO ENTER INTO THIS LEASE, TO THE FULLEST EXTENT PERMITTED BY LAW, LANDLORD AND TENANT EACH EXPRESSLY WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY TRIAL HELD AS A RESULT OF A CLAIM ARISING OUT OF, IN CONNECTION WITH, OR IN ANY MANNER RELATED TO THIS LEASE IN WHICH LANDLORD AND TENANT ARE ADVERSE PARTIES. THE FILING OF A CROSS-COMPLAINT BY ONE AGAINST THE OTHER IS SUFFICIENT TO MAKE THE PARTIES “ADVERSE.”

17.5 Headings; Time; Survival. The headings of the Articles, Sections and Exhibits of this Lease are for convenience only and do not define, limit or construe the contents thereof. Words of any gender used in this Lease shall be held and construed to include any other gender, and words in the singular number shall be held to include the plural, unless the context otherwise requires. Each of the parties hereto acknowledges that it has read and reviewed this Lease and that it has had the opportunity to confer with counsel in the negotiation of this Lease. Accordingly, this Lease shall be construed neither for nor against Landlord or Tenant, but shall be given a fair and reasonable interpretation in accordance with the meaning of its terms and the intent of the parties. In all instances where Tenant is required to pay any sum or do any act at a particular indicated time or within an indicated period, it is understood that time is of the essence. Any obligations of Tenant accruing prior to the expiration or termination of this Lease shall survive the expiration or termination of this Lease, and Tenant shall promptly perform all such obligations whether or not this Lease has expired.

17.6 Notices. Any notice which may or shall be given under the provisions of this Lease shall be in writing and may be delivered by (i) by hand delivery or personal service, (ii) by a reputable overnight courier service which provides evidence of delivery, (iii) by facsimile (so long as a confirming copy is forwarded by a reputable overnight courier service within twenty-four (24) hours thereafter), or (iv) by email (so long as a confirming copy is forwarded by a reputable overnight courier service within twenty-four (24) hours thereafter), if for Landlord, to the Building office and at the address specified in Item 16 of the Basic Lease Information, or if for Tenant, at the address specified in Item 3 of the Basic Lease Information, or at such other addresses as either party may have theretofore specified by written notice delivered in accordance herewith. Such address may be changed from time to time by either party by giving notice as provided herein. Notice shall be deemed given, (a) when delivered (if delivered by hand or personal service), (b) if sent by a reputable overnight courier service, on the business day immediately following the business day on which it was sent, (c) the date the facsimile is transmitted, or (d) the date the e-mail is transmitted. If the term Tenant as used in this Lease refers to more than one (1) person and/or entity, and notice given as aforesaid to any one of such persons and/or entities shall be deemed to have been duly given to Tenant. Notwithstanding any provision of this Lease to the contrary, in the case where

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statutory law requires that any notice, notice to quit or pay rent, summons or complaint (or any other form of writing required in connection with the assertion of rights against Tenant, the enforcement of Tenant’s obligations under this Lease or the termination of Tenant’s rights hereunder) (collectively, “Statutory Written Notices or Complaints”) must be delivered or served in a particular form, delivered to or served on Tenant through delivery to or service on a particular representative of Tenant, delivered or served in a particular manner (or by a particular method), for purposes of determining compliance with such applicable statutory requirements, the time, manner or method of delivery of all such Statutory Written Notices or Complaints delivered to or served on all of the Tenant addressees for notices listed in Item 3 of the Basic Lease Information (other than the timing, manner and/or method of delivery of the Statutory Written Notice or Complaint to the first addressee listed in Item 3 of the Basic Lease Information) shall be disregarded, and if the timing, manner and, method of delivery and form of the Statutory Written Notice or Complaint delivered to the first addressee listed in Item 3 of the Basic Lease Information shall satisfy the applicable statutory requirements, then such statutory requirements shall be deemed satisfied with respect to the timing, manner, and method of delivery and form with respect to all Tenant addressees as of the date of delivery to such first addressee.

17.7 Governing Law; No Counterclaim; Jurisdiction. This Lease shall be governed by, and construed in accordance with, the laws of the state in which the Property is located. It is mutually agreed that in the event Landlord commences any summary proceeding for non-payment of Rent, Tenant will not interpose any counterclaim (other than any compulsory counterclaims) of whatever nature or description in any such proceeding. The foregoing shall not be construed to prevent Tenant from bringing a separate action related to such counterclaims. In addition, Tenant hereby submits to local jurisdiction in the state in which the Property is located and agrees that any action by Tenant against Landlord shall be instituted in the state in which the Property is located and that Landlord shall have personal jurisdiction over Tenant for any action brought by Landlord against Tenant in the state in which the Property is located.

17.8 Incorporation; Amendment; Merger. This Lease, along with any exhibits and attachments or other documents referred to herein, all of which are hereby incorporated into this Lease by this reference, constitutes the entire and exclusive agreement between Landlord and Tenant relating to the Tenant Space, the Datacenter Connection Area and the Datacenter, and each of the aforementioned documents may be altered, amended or revoked only by an instrument in writing signed by the party to be charged thereby. All prior or contemporaneous oral agreements, understandings and/or practices relative to the leasing or use of the Tenant Space, the Datacenter Connection Area or the Datacenter are merged herein or revoked hereby.

17.9 Brokers. Each party hereto represents to the other that the representing party has not engaged, dealt with or been represented by any broker in connection with this Lease other than the brokers specified in Item 18 of the Basic Lease Information. Landlord and Tenant shall each indemnify, defend (with legal counsel reasonably acceptable to the other) and hold harmless the other party from and against all Claims (including attorneys’ fees and all litigation expenses) related to any claim made by any other person or entity for any commission or other compensation in connection with the execution of this Lease or the leasing of the Tenant Space to Tenant if based on an allegation that claimant dealt through the indemnifying party. The provisions of this Section 17.9 shall survive the termination of this Lease.

17.10 Examination of Lease. This Lease shall not be binding or effective until each of the parties hereto have executed and delivered an original or counterpart hereof to each other.

17.11 Recordation. Neither Tenant nor any person or entity acting through, under or on behalf of Tenant shall record or cause the recordation of this Lease, a short form memorandum of this Lease or any reference to this Lease.

17.12 Authority. Landlord and Tenant represent to the other party that the person signing the Lease on their respective behalf is duly authorized to execute and deliver this Lease pursuant to their respective by-laws, operating agreement, resolution or other legally sufficient authority. Further, each party represents to the other party that (i) if it is a partnership, the undersigned are all of its general

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partners, (ii) it has been validly formed or incorporated, (iii) it is duly qualified to do business in the state in which the Property is located, and (iv) this Lease is being executed on its behalf and for its benefit.

17.13 Successors and Assigns. Except as otherwise provided in this Lease, all of the covenants, conditions and provisions of this Lease shall be binding upon, and shall inure to the benefit of the parties hereto and their respective heirs, personal representatives and permitted successors and assigns.

17.14 Force Majeure. A party shall incur no liability to the other party with respect to, and shall not be responsible for any failure to perform, any of its obligations hereunder (other than payment obligations or obligations that may be cured by the payment of money (e.g., maintaining insurance)) if such failure is caused by any reason beyond the reasonable control of the party obligated to perform such obligations, including, but not limited to, strike, labor trouble, governmental rule, regulations, ordinance, statute or interpretation, or by fire, earthquake, civil commotion, or failure or disruption of utility services (collectively, “Force Majeure”). The amount of time for a party to perform any of its obligations (other than payment obligations) shall be extended by the amount of time it is delayed in performing such obligation by reason or any force majeure occurrence whether similar to or different from the foregoing types of occurrences.

17.15 No Partnership or Joint Venture; No Third Party Beneficiaries. Nothing contained in this Lease shall be deemed or construed to create the relationship of principal and agent, or partnership, or joint venturer, or any other relationship between Landlord and Tenant other than landlord and tenant. Landlord shall have no obligations hereunder to any person or entity other than Tenant or any person or entity claiming through Tenant, and no other parties shall have any rights hereunder as against Landlord.

17.16 Access by Landlord. Landlord, Landlord’s agents and employees shall have the right to enter upon any and all parts of the Tenant Space at any reasonable time upon prior reasonable oral or written notice (except in the case of an emergency when no prior notice shall be required) to examine the condition thereof, to clean, to make any repairs, alterations or additions required to be made by Landlord hereunder, to show the Tenant Space to prospective purchasers or tenants or mortgage lenders (prospective or current), to determine whether Tenant is complying with all of its obligations under this Lease, to exercise any of Landlord’s rights or remedies hereunder and for any reasonable purpose. In connection with Landlord’s rights hereunder, Landlord shall at all times have and retain a key with which to unlock all of the doors in, on or about the Tenant Space, and Landlord shall have the right to use any and all means by which Landlord may deem proper to open such doors to obtain entry to the Tenant Space. Tenant hereby waives any claim for damages for any injury to Tenant’s business or inconvenience to, or interference with, Tenant’s business, any loss of occupancy or quiet enjoyment of the Tenant Space or any other loss occasioned by such entry, and Tenant shall not be entitled to any abatement or reduction of Rent by reason thereof, and no such entry to the Tenant Space shall be deemed or construed to be a forcible or unlawful entry into or a detainer of the Tenant Space or an eviction, actual or constructive, of Tenant from any part of the Tenant Space. Notwithstanding anything in Sections 17.16 and 17.17, any rules or regulations promulgated by Landlord or any maintenance schedule relative to Landlord’s access to the Tenant Space to the contrary, Landlord agrees that (except in the case of an emergency) Landlord’s access to the Premises shall be subject to Landlord’s compliance with the procedures required by Tenant (“Tenant’s Security Procedures”), provided that (i) Landlord has received notice of Tenant’s Security Procedures and any changes thereof, and (ii) Tenant’s Security Procedures (as amended from time to time by Tenant) do not unreasonably interfere with Landlord’s ability to perform, or increase the cost to Landlord to perform, Landlord’s obligations under this Lease or any other lease demising premises in the Building. Tenant shall deliver written notice of the changes to Tenant’s Security Procedures to Landlord at Landlord’s address for notices as provided herein. Notwithstanding anything herein to the contrary, except for emergencies, Landlord shall use reasonable efforts to minimize disruption of Tenant’s business or occupancy during such entries.

17.17 Rights Reserved by Landlord. Landlord reserves the following rights exercisable without notice (except as otherwise expressly provided to the contrary in this Lease) and without being, deemed an eviction or disturbance of Tenant’s use or possession of the Tenant Space or giving rise to any

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claim for set-off or abatement of Rent: (i) to change the name or street address of the Building and/or the Property; (ii) to install, affix and maintain all signs on the exterior and/or interior of the Building and/or the Property; (iii) subject to the terms of Section 17.16, to display the Tenant Space, the Datacenter Connection Area, the Datacenter, the Building and/or the Property to mortgagees, prospective mortgagees, prospective purchasers and ground lessors, and prospective lessees at reasonable hours; (iv) subject to Sections 1.5 and 6.1 of this Lease, to change the arrangement of entrances, doors, corridors, elevators and/or stairs in the Datacenter, the Building and/or the Property, and/or to make such alterations to the Datacenter (including, without limitation, the Datacenter Connection Area) as Landlord deems desirable; (v) to install, operate and maintain systems which monitor, by closed circuit television or otherwise, all persons entering or leaving the Datacenter, the Building and/or the Property; (vi) to install and maintain pipes, ducts, conduits, wires and structural elements located in the Datacenter or the Tenant Space and which serve other parts or other tenants or occupants of the Datacenter, the Building and/or the Property; (vii) to retain at all times master keys or pass keys to the Tenant Space; (viii) the exclusive right to create any additional improvements to structural and/or mechanical systems, interior and exterior walls and/or glass, which Landlord deems necessary without the prior consent of Tenant; and (ix) the absolute right to lease space in the Datacenter, the Building and the Property and to create such other tenancies in the Datacenter, the Building and the Property as Landlord, in its sole business judgment, shall determine is in the best interests of the Property (and Landlord does not represent and Tenant does not rely upon any specific type or number of tenants occupying any space in the Datacenter, the Building and the Property during the Term of this Lease).

17.18 Counterparts; Execution by Facsimile. This Lease may be executed simultaneously in two or more counterparts each of which shall be deemed an original, but all of which shall constitute one and the same Lease. Landlord and Tenant agree that the delivery of an executed copy of this Lease by facsimile shall be legal and binding and shall have the same full force and effect as if an original executed copy of this Lease had been delivered.

17.19 Confidentiality. Each party agrees that (i) the terms and provisions of this Lease are confidential and constitute proprietary information of the parties and (ii) it shall not disclose, and it shall cause its partners, officers, directors, shareholders, employees, brokers and attorneys to not disclose any term or provision of this Lease to any other person without first obtaining the prior written consent of the other party, except that each party shall have the right to disclose such information for valid business, legal and accounting purposes and/or if advisable under any applicable securities laws regarding public disclosure of business information.

17.20 Incorporation of Exhibits. All of the terms and conditions of all of the Exhibits to this Lease are hereby incorporated into this Lease.

[SIGNATURES APPEAR ON NEXT PAGE]

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IN WITNESS WHEREOF, the parties hereto have duly executed this Lease as of the Effective Date.

LANDLORD:
DIGITAL PHOENIX VAN BUREN, LLC, a Delaware limited liability company
By:	Digital Realty Trust, L.P., a Maryland limited partnership, its sole Member and Manager
	By:	Digital Realty Trust, Inc., a Maryland corporation, its General Partner
		By:	/s/ James R. Trout
		Name:	James R. Trout
		Its:	Senior Vice President
Date:		10/25/07

TENANT:
DANGER INC., a Delaware corporation
By:	/s/ Henry R. Nothhaft
Name:	Henry R. Nothhaft
Title:	Chairman and CEO
Date:	October 22, 2007

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EXHIBIT “A”

DEPICTION OF DATACENTER; PREMISES AND DATACENTER CONNECTION AREA

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EXHIBIT “B”

INSURANCE REQUIREMENTS

Policies

A. Commercial general liability insurance (including contractual liability):	$2,000,000 per occurrence; $5,000,000 aggregate limit
B. “All Risk” Personal Property Insurance:	Full Replacement Value of Tenant’s Personal Property in Tenant Space.
C. Workers’ Compensation Insurance:	in accordance with the laws of the state in which the Property is located, and Employer’s Liability Insurance with a limit not less than $1,000,000 Bodily Injury Each Accident; $1,000,000 Bodily Injury By Disease Each Person; and $1,000,000 Bodily Injury By Disease Policy Limit.
D. Rental Loss Insurance:	$2,000,000

Requirements:

All insurance required under this Lease shall be issued by insurers with a “General Policyholders Rating” of at least A-, VII, as set forth in “Best’s Insurance Guide.” Such insurers shall be authorized to do business in the state in which the Property is located. The commercial general liability policies procured hereunder shall name the Landlord Group (as defined in the Basic Lease Information) and Landlord’s managing agent, and any Holders of any Security Documents designated by Landlord as additional insureds. Prior to occupying the Tenant Space and upon subsequent requests of Landlord, Tenant shall submit to Landlord evidence that Tenant has the insurance policies required hereunder in effect and, if requested by Landlord, shall provide Landlord with certificate of insurance evidencing such policies. All such insurance policies procured hereunder shall contain a provision stating that the insurer shall endeavor to provide at least thirty (30) days written notice to Landlord and all others named as additional insureds prior to any cancellation or decrease in coverage of such policy. If Tenant does not deliver to Landlord a certificate or other proof of renewal or coverage from another insurance carrier prior to the expiration dates of each expiring policy, Landlord may obtain such insurance on behalf of Tenant, and Tenant shall, within ten (10) days after Landlord’s demand therefor, pay to Landlord an amount equal to the cost of such insurance policies plus an administrative surcharge of ten percent (10%). All of Tenant’s insurance policies with respect to the Tenant Space (with the exception of its workers’ compensation insurance if such waiver is prohibited by Applicable Law in such policies of insurance) shall include a waiver of subrogation in accordance with and to the full extent of Tenant’s waiver of claims with respect to the Landlord Group set forth in Sections 9.2 and 14.1 of this Lease. Coverage for policies referred to in A and B above may be provided by a combination of primary and excess insurance policies, in Tenant’s discretion.

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EXHIBIT “C”

DESCRIPTION OF PATHWAY

Tenant is hereby granted the right to pathway in the Building (the “Pathway”) from the Datacenter Connection Area (as shown on Exhibit “A”) to Landlord’s interconnection rack in the Meet-Me Room, via such pathway as is hereafter designated by Landlord, into which Tenant may install up to eight (8) fiber pairs.

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EXHIBIT “D”

ARIZONA STATE LAW PROVISIONS

1. REMEDIES FOR EVENTS OF DEFAULT.

1.1 Landlord’s Right to Terminate Upon Tenant Default. This Lease and the Term and estate hereby granted and the demise hereby made are subject to the limitation that if and whenever any Event of Default shall occur and be continuing, Landlord may, at Landlord’s option, in addition to all other rights and remedies given hereunder or by law or equity, do any one or more of the following without notice or demand, any such notice or demand being hereby waived, to the extent that such waiver is allowed by Applicable Laws:

1.1.1 Terminate this Lease, in which event Tenant shall immediately surrender possession of the Tenant Space to Landlord.

1.1.2 Enter upon and take possession of the Tenant Space and expel or remove Tenant and any other occupant therefrom, with or without having terminated the Lease.

1.1.3 Alter locks and other security devices at the Tenant Space.

1.1.4 Terminate any and all agreements, subleases, licenses, concessions or other consensual arrangements for possession entered into by Tenant, with Landlord or with third parties, and affecting the Tenant Space or any part of the Meet-Me Room or the Building.

1.2 No Surrender or Merger. Exercise by Landlord of any one or more remedies hereunder granted or otherwise available shall not be deemed to be an acceptance of surrender of all or any part of the Tenant Space by Tenant, whether by agreement or by operation of law, it being understood that such surrender can be effected only by the written agreement of Landlord and Tenant. No such alteration of security devices and no removal or other exercise of dominion by Landlord over the property of Tenant or others on or about the Tenant Space shall be deemed unauthorized or constitute a conversion, Tenant hereby consenting, after any Event of Default, to the aforesaid exercise of dominion over Tenant’s property within the Building. All claims for damages by reason of such re-entry and/or possession and/or alteration of locks or other security devices are hereby waived, as are all claims for damages by reason of any distress warrant, forcible detainer proceedings, sequestration proceedings or other legal process, to the extent that such waiver is allowed by Applicable Laws. Tenant agrees that any re-entry by Landlord may be pursuant to judgment obtained in forcible detainer proceedings or other legal proceedings or without the necessity for any legal proceedings, as Landlord may elect, and Landlord shall not be liable in trespass or otherwise. Notwithstanding anything to the contrary contained or implied in the foregoing, Landlord agrees, in the exercise of its remedies under this Exhibit “D”, to use commercially reasonable efforts in the physical handling and/or moving of Tenant’s property, and to be and remain responsible for the gross negligence and willful misconduct of Landlord and of Landlord’s agents, employees and contractors in connection therewith.

1.3 Damages Upon Default. If Landlord elects not to terminate this Lease by reason of an Event of Default, then, notwithstanding such termination, Tenant shall be liable for and shall pay to Landlord the sum of all rental and other indebtedness accrued to the date of such termination, plus, as damages, an amount equal to the then present value of the rental reserved hereunder (including, without limitation, Rent and all other charges under this Lease) for the remaining portion of the Term of this Lease (had such Term not been terminated by Landlord prior to the expiration of the Term of this Lease), less the then present value of the fair rental value of the Tenant Space for such period.

In the event that Landlord elects to terminate the Lease by reason of any Event of Default, in lieu of exercising the rights of Landlord under the preceding paragraph of this Section 1.3, Landlord may instead hold Tenant liable for all rental and other indebtedness accrued to the date of such

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termination, plus such rental and other indebtedness as would otherwise have been required to be paid by Tenant to Landlord during the period following termination of the Term of this Lease measured from the date of such termination by Landlord until the expiration of the Term of this Lease (had Landlord not elected to terminate the Lease on account of such Event of Default), subject to Landlord’s duty to mitigate its damages, as set forth in Section 1.9 of this Exhibit “D”. Actions to collect amounts due by Tenant provided for in this paragraph of this Section 1.4 may be brought from time to time by Landlord during the aforesaid period, on one or more occasions, without the necessity of Landlord’s waiting until the expiration of such period, and in no event shall Tenant be entitled to any excess of rental (or rental plus other sums) obtained by reletting over and above the rental provided for in this Lease. If Landlord accelerates future payments under this Lease following an Event of Default, all rents and other amounts owing to Landlord shall be discounted to their present value using a discount factor of six percent (6%).

1.4 Repossession of Tenant Space. If Landlord elects to repossess the Tenant Space without terminating this Lease, Tenant shall be liable for and shall pay to Landlord all rental and other indebtedness accrued to the date of such repossession, plus Rent required to be paid by Tenant to Landlord during the remainder of the Term of this Lease until the expiration of the Term of this Lease, subject to Landlord’s duty to mitigate its damages, as set forth in Section 1.9 of this Exhibit “D”. In no event shall Tenant be entitled to any excess of any rental obtained by reletting over and above the rental herein reserved. Actions to collect amounts due by Tenant as provided in this Section 1.4 may be brought from time to time, on one or more occasions, without the necessity of Landlord’s waiting until the expiration of the Term of this Lease.

1.5 Landlord’s Expenses. Upon an Event of Default, Tenant shall also be liable for and shall pay to Landlord, in addition to any sum provided to be paid pursuant to this Lease: (i) the reasonable costs and expenses of securing new tenants, including expenses for refixturing, alterations and other costs in connection with preparing the Tenant Space for the new tenant and any reasonable or necessary alterations, (ii) the reasonable cost of removing and storing Tenant’s or other occupant’s property, and (iii) all reasonable expenses incurred by Landlord in enforcing Landlord’s remedies, including reasonable attorneys’ fees. Past due rental and other past due payments shall bear interest from maturity at the Default Rate (as defined in Section 3.4 of the Lease) until paid.

1.6 Cumulative Remedies; Equitable Relief. The specific remedies to which Landlord may resort under the provisions of this Lease are cumulative and are not intended to be exclusive of any other remedies or means of redress to which it may be lawfully entitled in case of any breach or threatened breach by Tenant of any provisions of this Lease. In addition to the other remedies provided in this Lease, subject to Applicable Laws, Landlord shall be entitled to a restraint by injunction of the violation or attempted or threatened violation of any of the covenants, conditions or provisions of this Lease or to a decree compelling specific performance of any such covenants, conditions or provisions.

1.7 Reletting. Tenant acknowledges that Landlord has entered into this Lease in reliance upon, among other matters, Tenant’s agreement and continuing obligation to pay all rental due throughout the Term. As a result, Tenant hereby knowingly and voluntarily waives, after advice of competent counsel, any duty of Landlord (and any affirmative defense based upon such duty) following any default to relet the Tenant Space or otherwise mitigate Landlord’s damages arising from such default, except as set forth in Section 1.9, below. In connection with the foregoing, and consistent with Landlord’s duty to use commercially reasonable efforts to mitigate its damages as set forth in Section 1.9, below, Tenant agrees that Landlord has no obligation to: (i) relet the Tenant Space prior to leasing any other space within the Building; or (ii) relet the Tenant Space (A) at a rental rate or otherwise on terms below market, as then determined by Landlord in its sole discretion; (B) to any entity not satisfying Landlord’s then standard financial credit risk criteria; (C) for a use (1) not consistent with Tenant’s use prior to default; (2) which would violate then applicable law or any restrictive covenant or other lease affecting the Building; (3) which would impose a greater burden upon the Building’s facilities; or (4) which would involve any use of Hazardous Materials; or (iii) make any alterations to the Tenant Space, the Datacenter or the Building or otherwise incur any costs in connection with any such reletting, unless Tenant unconditionally delivers to Landlord, in good and sufficient funds, the full amount thereof in advance.

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1.8 Landlord’s Right to Cure. All covenants and agreements to be performed by Tenant under this Lease shall be performed by Tenant at Tenant’s sole cost and expense. If Tenant should fail to make any payment (other than Base Rent) or cure any default hereunder within the time herein permitted, Landlord, without being under any obligation to do so, without thereby waiving such default and in addition to and without prejudice to any other right or remedy of Landlord, may make such payment and/or remedy such other default for the account of Tenant (and enter the Tenant Space for such purpose), and thereupon Tenant shall be obligated to, and hereby agrees to, pay to Landlord as Additional Rent, within thirty (30) days following Landlord’s demand therefor, all reasonable costs, expenses and disbursements (including reasonable attorneys’ fees) incurred by Landlord in taking such remedial action, plus an administrative fee of ten percent (10%) of such amount.

1.9 Landlord’s Duty to Mitigate Damages. Notwithstanding anything in this Exhibit “D” to the contrary, Landlord agrees that, in the event of an Event of Default by Tenant, Landlord shall use commercially reasonable efforts to mitigate Landlord’s damages.

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EXHIBIT “E”

LANDLORD’S INSTALLATIONS

Landlord will cause:

1. one (1) Datacenter cage with one (1) lockable sliding gate to be installed, approximately as set forth on Exhibit “A”.

2. raised access flooring to be cut and installed in the Premises to accommodate power and network for Tenant’s cabinet, equipment and relay rack layout.*

* Tenant shall coordinate with Landlord’s Technical Operations team for criteria for sealing tile cuts.

3. an under floor grounding feed to be delivered to the Premises**.

** Tenant is responsible for individual H-taps and grounding to cabinets, equipment and relay racks, including the cost thereof.

4. submeter(s) to monitor power consumption to be installed.

5. installation of a raised floor for the Premises with a point load of 1,250 lbs.

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EXHIBIT “E-1”

COMMISSIONING CRITERIA

Infrastructure commissioning consists of five general levels of activities summarized as follows, the specifics of which shall be mutually agreed upon by Landlord and Tenant.

Level 1 – Factory Testing

Manufacturers standard test reports will be reviewed prior to shipment of equipment to the site.

Level 2 – Component Verification

Individual system components are verified at the site upon delivery for compliance to the design specifications, drawings, and approved submittals or shop drawings.

Level 3 – System Construction Verification

As the components are assembled into individual systems, the construction or installation of the overall system is verified. This includes an evaluation on interconnection between components, physical arrangement, support and anchoring, and access and clearance.

Level 4 – Individual System and Major Equipment Operation Verification

Subsequent to the completion of construction and assembly of each individual system or major equipment element, it is started-up and tested for proper functional operation and performance.

Level 5 – Integrated Systems Operation Verification

The test procedures that comprise Level 5 commissioning are designed to simulate the operation of the Premises during a full range of operational situations, including loss of utility services, single and multiple equipment failure, normal sequential changes to the equipment operation, and planned maintenance operations. Tenant shall have the right to review the test procedures in advance to confirm that such test procedures are in accordance with generally accepted practices.

This effort is dependent upon the successful completion of all prior levels of commissioning. The assembly of appropriate documentation and certifications for the completion of Level Four commissioning will be a prerequisite.

Level 5 commissioning will typically be completed in four basic steps:

• Initial planning

• Preparation of test procedures

• Implementation of tests

• Documentation of test results. Tenant shall have the right to review the test results to confirm that the test results are in accordance with the objective requirements set forth in the test procedures.

To the extent that is possible, training of operational staff will be enhanced by their witnessing of and participation in the actual Level 5 testing. Specific training exercises may be considered where appropriate and time allows.

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EXHIBIT “E-2”

MEMORANDUM OF UNDERSTANDING

This Memorandum of Understanding (this “MOU”) is entered into as of the latest date of execution shown on the signature page hereof (the “MOU Effective Date”), by and among DIGITAL PHOENIX VAN BUREN, LLC (“Landlord”), as landlord,                                  (“Tenant”), as tenant, and each of the contractors (collectively, the “Contractors”) listed on the signature pages hereof.

Reference is hereby made to that certain Turn Key Datacenter Lease (the “Lease”) dated                     , 2007, by and between Landlord and Tenant, demising premises in that certain building commonly known as 120 E. Van Buren Street, Phoenix, Arizona (the “Building”). Unless otherwise provided herein, capitalized words and phrases shall have the same meanings as those given to them in the Lease.

Tenant desires to commence immediately with the performance of a number of fit-out and installation projects (as defined in the Lease, the “Tenant Work”) in the Premises in connection with the Lease.

Landlord agrees to permit Tenant to commence the Tenant Work on and after the date of this MOU, subject to Tenant’s, and the Contractors’, compliance with the terms of this MOU.

In addition to the requirements set forth in the Lease, Tenant acknowledges and agrees to the following:

1. Tenant agrees to comply with the Procedural Requirements (the “Procedural Requirements”) set forth on

Exhibit E-2-A, attached hereto.

2. Tenant will be responsible for causing Tenant’s employees, agents, contractors and vendors to coordinate schedules with, take direction from, and comply with all site safety and work rules of, Landlord’s construction management team (collectively, “Construction Manager”).

3. Tenant shall ensure that the Tenant Work will not delay Landlord’s completion of the Commencement Date Conditions. Tenant hereby agrees that Tenant will, and will cause the Contractors to, work in harmony with Landlord and Landlord’s contractors, who will be preparing the Commencement Date Conditions in the Premises during the Early Access Period. Any Tenant Work that does delay Landlord’s performance of the Commencement Date Conditions shall be referred to herein as a “Tenant Delay”. In the event that the Commencement Date is, in accordance with the terms of the Lease, moved beyond the Target Commencement Date, due to Landlord not having delivered the Tenant Space to Tenant on or before such date, the Commencement Date shall be deemed to have been moved up, day for day, by the number of days of delay in Landlord’s completion of the Commencement Date Conditions caused by all such Tenant Delays (i.e., if delivery of the Tenant Space (and, by definition, the Commencement Date) does not occur until November 20, 2007, but there were 20 days of Tenant Delay, the Commencement Date would be deemed to have occurred on November 1, 2007).

4. While Landlord and Construction Manager will make reasonable efforts to facilitate the Tenant Work, it is understood that it may be necessary, from time to time, to require interruption or cessation of all or part of the Tenant Work in order to complete the Commencement Date Conditions. In the event continuation of the performance of the Tenant Work will delay the performance of the Commencement Date Conditions and/or Landlord’s curing of any deficiencies in the Commencement Date Conditions, Landlord may require Tenant’s Contractors and vendors to cease performance of the Tenant Work until such time as performance of the Tenant Work will

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not delay the performance of the Commencement Date Conditions and/or Landlord’s curing of any deficiencies in the Commencement Date Conditions.

5. Tenant will require each Contractor performing work on Tenant’s behalf to provide a certificate of insurance to the Landlord, naming Landlord, Landlord’s property manager and Construction Manager as additional insureds, with coverage as required by the Landlord (“Insurance Certificates”).

6. It is understood that there will be no permanent power or cooling in the Premises until the completion of the Commencement Date Conditions, and that any temporary power provided during the construction project may need to be interrupted without notice during the course of construction.

7. Any temporary power, cooling or other construction assistance (e.g., debris cart, equipment storage, labor, etc.) which Tenant, or Tenant’s Contractors, may require in the course of the Tenant Work will be requested through Construction Manager, via written change order signed by Tenant, and paid for by the Tenant or the Tenant’s Contractor.

Tenant acknowledges that, notwithstanding anything herein to the contrary, Landlord’s consent to Tenant’s performance of the Tenant Work is subject to and conditioned upon Tenant’s compliance with the terms of the Lease.

[SIGNATURE PAGES TO FOLLOW]

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IN WITNESS WHEREOF, the parties hereto have duly executed this MOU as of the latest of the execution dates shown below.

LANDLORD:
DIGITAL PHOENIX VAN BUREN, LLC, a Delaware limited liability company
By:	Digital Realty Trust, L.P., a Maryland limited partnership, its sole Member and Manager
	By:	Digital Realty Trust, Inc., a Maryland corporation, its General Partner
		By:
		Name:	James R. Trout
		Its:	Senior Vice President
Date:

TENANT:

DANGER INC.,

a Delaware corporation

By:

Name:

Title:

Date:

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AGREED TO AND ACCEPTED

This      day of                     , 20__:

CONTRACTORS:

By:

Name:

Title:

[Insert a signature block for each contractor and vendor who should agree to this Memorandum of Understanding]

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EXHIBIT E-2-A

PROCEDURAL REQUIREMENTS FOR EARLY ACCESS

1. As required by the Lease, prior to commencement of the Tenant Work, Tenant must submit to Landlord for its approval pursuant to the Lease, a description of each individual project within scope of the Tenant Work, and all plans, schedules and specifications for the Tenant Work and the contractors and vendors who will perform the Tenant Work. Specifically, prior to such access, (a) Tenant must submit the Preliminary Documents (described below) to Landlord for review; (b) Tenant must adequately define the scope of the Tenant Work in writing; (c) Tenant must provide Landlord a list of the contractors and vendors who will be accessing and/or performing any part of the Tenant Work for Landlord’s reasonable approval; (d) Tenant must provide Landlord with Tenant’s proposed schedule for the Tenant Work; and (d) Tenant must submit Tenant’s Detailed Installation Drawings (described below) to Landlord for review.

2. The minimum acceptable PRELIMINARY DOCUMENTS required from Tenant for evaluation by Landlord are as follows (please provide three (3) full sets of each; two (2) full size hard copies and one (1) full set on CD):

(a) Floor Plan showing equipment layout (including kW density per cabinet / rack)

(b) Written description of Tenant Work (i.e., the overall scope of the Tenant Work, including data cabling, power distribution, etc.) [Schematic Drawings are preferred but not required.]

(c) Gantt Schedule (Bar chart / MS Project Style)

(d) Tenant must obtain building/construction permits for all Tenant Work.

3. In the event that the Tenant Work is intended to consist of more than one “project”, Tenant must obtain Landlord’s written authorization on each project prior to the start of each project.

4. In the event that there are any changes required to the Commencement Date Conditions to accommodate Tenant’s planned Tenant Work, an approved change order must be signed by Tenant before any changes will be made.

5. Upon the approval by Landlord of the Contractors and vendors for the Tenant Work, Tenant must submit certificates of insurance, in accordance with Item 5 of the MOU, above, to Landlord.

6. Once Landlord’s Operations Group has approved the Preliminary Documents, Construction Manager will forward the approved Preliminary Documents to Landlord’s Design & Construction Group who will have the GC/CM review Tenant’s proposed scope and schedule and advise as to the scheduled times that Tenant can access the Premises to commence the Tenant Work. The GC/CM will issue an update to the Commencement Date Conditions project schedule showing the dates that Tenant’s contractors can access the site to perform the Tenant Work. DLR Design & Construction will provide the updated schedule to Construction Manager, who will provide the updated schedule to Tenant.

7. In addition to three (3) complete sets of detailed plans and specifications for the Tenant Work (two (2) full size hard copies, and one complete set on CD), Tenant’s DETAILED INSTALLATION DRAWINGS must also include the following:

(a) Cabinet anchorage plan, if applicable – meeting applicable seismic zone criteria.

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(b) Data cabling plan – please note that, if overhead ladder racks are intended to be utilized in the Tenant Work, the design must meet the applicable seismic zone criteria; and

(c) Electrical power distribution installation plan.

8. Once Tenant has provided all documents required by the Lease and this MOU [including Insurance Certificate(s), Permit(s), Plans, etc.], Landlord will provide Tenant written notice that all required documentation has been provided, at which point Tenant’s Contractors will be permitted to commence the Tenant Work in the Premises, subject to Tenant’s, and Tenant’s Contractor(s), compliance with the terms of this MOU, the terms of the Lease, and the Tenant Work schedule provided by Construction Manager.

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EXHIBIT “F”

SERVICE LEVEL

1.	Electricity Consumption Threshold/Specifications:	a.      During the Prem A Period: Three hundred (300) total kW of UPS. b.      During the Prem A-B Period: Six hundred (600) total kW of UPS.
2.	Target Battery Capacity:	Six (6) minutes.
3.	Back-up Generator:	Three (3) 2000 kW Building generators are maintained by Landlord’s engineering staff. Back-up Power is included in all AC amperage usage.
4.	HVAC:
	(a)    Target Temperature:	Between 68 degrees Fahrenheit and 78 degrees Fahrenheit as measured at the return air vent.
	(b)    Target Relative Humidity:	Between 45% and 65% as measured at the return air vent.
	(c)    HVAC Specs:	330 total tons delivered by down flow air-cooled chilled water system. System is dedicated to Suite 130 and maintained by a third (3rd) party on Landlord’s behalf and/or by Landlord’s engineering staff.
5.	Maximum Structural Load:	250 pounds of live load per square foot with respect to the Building slab. Any cabinets, cages or partitions installed by Landlord shall be included in the calculation of the live load.

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EXHIBIT “G”

INTENTIONALLY OMITTED

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EXHIBIT “H”

DATACENTER RULES AND REGULATIONS

Datacenter

Rules and Regulations

Operation and Maintenance Guide

TABLE OF CONTENTS

1.0    THE PURPOSE OF THESE STANDARDS	1
2.0    DEFINITION OF A CRITICAL ENVIRONMENT	1
3.0    GENERAL RULES	1
4.0    GUIDELINES ON WHEN TO INVOLVE BUILDING MANAGEMENT	2
5.0    CABLE INSTALLATIONS	3
6.0    ELECTRICAL DISTRIBUTION	4
7.0    FIRE ALARM/SUPPRESSION SYSTEMS	5
8.0    LABELING STANDARD	5
9.0    HVAC STANDARDS	6
10.0  CABINET/CAGE ACCESS & SIGNAGE STANDARDS	6
11.0  DELIVERIES	6
12.0  EQUIPMENT INSTALLATION	7
13.0  TRASH REMOVAL	8
14.0  ROOM ACCESS & SECURITY	9
15.0  APPROVED LABELING AND BINDING MATERIALS	11
16.0  SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL	12
17.0  SAMPLE BUILDING MEETING REQUEST EMAIL	13

SECTION 14201: DATACENTER RULES & REGULATIONS AND INSTALLATION PROCEDURES

1.0 THE PURPOSE OF THESE STANDARDS

A. This section applies to single and multi-tenant locations that are managed and operated by Digital Realty Trust or their providers. Locations where tenants manage their sites, these Rules and Regulations are highly recommended, but are not required.

B. To help you work in the Datacenter Room, we need to provide you with the following:

(i) An awareness of the critical nature of the Datacenter Room environment;

(ii) These rules and regulations must be followed when working at these sites

(iii) The extra care you must take in performing all activities, even the most routine duties

(iv) Who to call before you start and if you encounter a problem

(v) Help you achieve your goal of NO UNPLANNED OUTAGES

2.0 DEFINITION OF A CRITICAL ENVIRONMENT

A. A critical environment consists of all areas, rooms, systems and equipment associated with network operations. These include the UPS modules, chilled water, electrical distribution systems, and the computer equipment that depends on it.

B. The term critical refers to the need to maintain continuous up-time for all primary systems: 24 hours a day; 7 days a week, 365 days a year.

3.0 GENERAL RULES

A. Vendors are not allowed into the Datacenter without prior notification and approval from the tenant. It is the tenant’s responsibility to inform Building Management and Security.

B. If you observe any problems with doors not closing properly or you notice any other possible security concern, be sure to report the issue to Building Security promptly.

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C. Cameras, video equipment or visitors are not allowed in the Datacenter unless specifically authorized to do so by the tenant. It is the tenant’s responsibility to inform Building Management and Security.

D. This is a ‘no smoking facility’. Smoking is allowed outside in marked areas only.

E. No food or drink is allowed in the Datacenter at any time.

F. Tampering with the access control systems, camera equipment, or fire alarm/smoke detectors within the building is strictly prohibited and can result in immediate dismissal from the building.

G. No “Tenant to Tenant” cable runs are permitted between Tenant cages in the Datacenter. All interconnections must occur in the Building Meet-Me Room.

4.0 GUIDELINES ON WHEN TO INVOLVE BUILDING MANAGEMENT

This section highlights the most common reasons for Tenants to involve Building Management personnel. This list is intended as a quick reference guide only and by no means is all inclusive. If there are any doubts concerning any operations parameters within the Datacenter, you should contact Building Management.

A. VENDORS. Vendor access requires 12-hour prior notice with detail of activity to be performed by the vendors[; provided, however, that the prior notice requirement shall be “6-hours prior notice” in the event of an emergency situation in the Datacenter]*. Requests for clearance can be no more than one-week at a time. For a multiple week project, a new request is required each week. See SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL at the end of this document.

* Landlord agrees not to modify the bracketed portion of this item 4.0A, as it relates to Tenant and/or the Tenant Space, during the Term of the Lease without Tenant’s prior approval, which approval may be withheld in Tenant’s sole and absolute discretion.

B. SMOKE, ODOR, DUSTY WORK INCLUDING HEAT GUNS. Requires 24-hour advanced notification to allow for disabling of the Fire Suppression System by Building Engineering ONLY. See SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL at the end of this document.

C. ACCESS FOR EMPLOYEES. In addition to the initial Datacenter access list each Tenant shall provide updates for, any changes in personnel that require access to the Datacenter. The information must be provided to Building Management prior to the employee’s entry into the Datacenter. Be advised that, biometric readers will require programming prior to first-time entry. It will be the sole responsibility of the Tenant to inform Building Management of any personnel they wish have removed from the approved access list.

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D. POWER TURN-UP. Requires 24-hour prior notice for Building Engineering to inspect electrical connectivity and activate breakers[; provided, however, that the prior notice requirement shall be “6-hours prior notice” in the event of an emergency situation in the Datacenter]*.

* Landlord agrees not to modify the bracketed portion of this item 4.0D, as it relates to Tenant and/or the Tenant Space, during the Term of the Lease without Tenant’s prior approval, which approval may be withheld in Tenant’s sole and absolute discretion.

5.0 CABLE INSTALLATIONS

A. All cables to and from the Tenant space must run in the common area cable management system – there are no exceptions.

B. For datacenter users, the under floor cable management is used for all cable runs. Any tile modifications must be approved by the Building Engineer.

C. If it is necessary for the raised floor tiles to be cut, they will be performed by the building or datacenter engineering staff. After the initial installation, all additional tile cuts will be at an additional cost. NO tile cutting will be done in the raised floor room.

D. For telco users, overhead ladder racks are used for copper and coaxial cables, and fiber guide trays are used for fiber runs.

E. All cables, to the extent that they exit the Premises (i.e., to the extent that they are located under the raised floor or outside of the cage or Building walls that demise the Premises (all such cables are referred to herein as “Interspace Cables”)) must be bundled together using the approved materials as provided within this document. The standard for Interspace Cables is wax-coated string or Velcro-ties for ease of installation and removal. No plastic tie-straps for Interspace Cables will be permitted.**

** Landlord agrees not to modify this item 5.0E, during the Term of the Lease, as it relates to Tenant and/or the Tenant Space, to cause such item to apply to cables that do NOT exit the Premises, without Tenant’s prior approval, which approval may be withheld in Tenant’s sole and absolute discretion.

F. All Interspace Cable installations will be secured to a cable rack/tray using wax-coated string or Velcro-ties to ensure stability and cleanliness. **

** Landlord agrees not to modify this item 5.0F, during the Term of the Lease, as it relates to Tenant and/or the Tenant Space, to cause such item to apply to cables that do NOT exit the Premises, without Tenant’s prior

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approval, which approval may be withheld in Tenant’s sole and absolute discretion.

G. At no time will Interspace Cables be allowed to extend beyond the rack/tray edges. Interspace Cable bundles will be kept in a neat and orderly fashion to maintain workability and appearance.**

** Landlord agrees not to modify this item 5.0G, during the Term of the Lease, as it relates to Tenant and/or the Tenant Space, to cause such item to apply to cables that do NOT exit the Premises, without Tenant’s prior approval, which approval may be withheld in Tenant’s sole and absolute discretion.

H. All Interspace Cables must be run on top of the rack/tray and are not allowed to be run underneath them.**

** Landlord agrees not to modify this item 5.0H, during the Term of the Lease, as it relates to Tenant and/or the Tenant Space, to cause such item to apply to cables that do NOT exit the Premises, without Tenant’s prior approval, which approval may be withheld in Tenant’s sole and absolute discretion.

I. All Interspace Cables must be labeled according to the Labeling Standard listed on the last page of this document.**

** Landlord agrees not to modify this item 5.0I, during the Term of the Lease, as it relates to Tenant and/or the Tenant Space, to cause such item to apply to cables that do NOT exit the Premises, without Tenant’s prior approval, which approval may be withheld in Tenant’s sole and absolute discretion.

J. All under floor cables must be plenum rated.

6.0 ELECTRICAL DISTRIBUTION

A. Building Management and Engineering will manage all electrical distribution requirements. All electrical distribution installations and/or changes must be specified and approved in advance by Building Management.

B. Leases must be fully executed between the Tenant and the Landlord prior to electrical circuit activation.

C. A list of approved electrical contractors is maintained by the Building Management. These are the ONLY approved electrical installation contractor for any alterations to the Datacenter electrical, the grounding system and the base building electrical infrastructure.

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D. All Tenants must adhere to the existing color-codes for all DC electrical cables, wires, etc. All such cabling shall match the existing Building and Datacenter electrical distribution and grounding systems at all times.

• DC cabling – cloth covered (RHW) with red for positive and black for negative

• Grounding – green (THHN)

E. Building Engineering will control all electrical breaker positions. All distribution panels will remain locked at all times. Coordination of breaker operation must be requested by the Tenant to the Building Management, and approved by the Building’s Chief Engineer and/or his designated representative, prior to activation.

F. Tenants are responsible for the termination of all DC cabling to Tenant fuse panels within their cage(s).

G. Tenants are responsible for any power strips or equipment plug-ins to UPS circuits within their cage(s) or cabinets.

7.0 FIRE ALARM/SUPPRESSION SYSTEMS

A. Tenants are not authorized to tamper with or alter the Building’s existing Fire Alarm/Suppression Systems at any time.

B. The fire suppression system for the Datacenter must be disabled for any work, which may cause smoke, odor, or dust, including the use of heat guns. A minimum of 24 hours advanced written notice to the Building Management office is required. Email notice with receipt confirmation from the Building Manager is considered acceptable notice. All notices must be accompanied with a detailed description outlining the scope of work. SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL at the end of this document.

C. In cases of emergency, the Fire Suppression System may be disabled off-hours by Building Security. Some instances may require the approval of the on-call Building Engineer prior to disabling the system.

8.0 LABELING STANDARD FOR INTERSPACE CABLING

A. COMMUNICATIONS CABLES: Tagging of all cables must be performed at the beginning and end points of each cable. Tags should be present every 10 feet. Tenant standard tags are acceptable. “Write-on” labels are allowed for the identification of circuits due to the potential for change, but must be legible. Tags must have the following: Tenant name, cage location and interconnection rack area or port number(s).

B. POWER CABLES:

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(i) All DC electrical conductors from the Tenant Cabinet/Cage to the Interconnection Area must be labeled at the Cabinet/Cage to identify the specific distribution source breaker and at the Interconnection Area related distribution panel.

(ii) All AC cabling will be labeled according to established and completed by the electrical contractor or Building Engineering.

9.0 HVAC STANDARDS

A. Alteration of or tampering with the Building HVAC settings, related airflows or any other HVAC systems within the Datacenter is strictly prohibited.

10.0 CABINET/CAGE ACCESS & SIGNAGE STANDARDS

A. KEYS/KEY REQUESTS: Building Engineering shall provide keys for each cage independently. Each cage is provided with one key at no initial cost. Any re-key or duplicate key requests must be in writing and submitted to Building Management. Such requests will be at an additional charge.

B. SIGNS/SIGN REQUESTS: The Landlord shall provide the initial cabinet/cage signage for each Tenant, using the Building Standard signage. Any additional signs or changes must be approved by the landlord and are subject to additional charges. Landlord must approve any changes requested by any Tenant, and all such changes are subject to additional charges.

11.0 DELIVERIES

A. MAJOR EQUIPMENT DELIVERIES: Any deliveries that will take longer than 30 minutes of dock time requires after hours reservation of the freight elevator cab and dock space.

(i) All Tenants are required to ensure delivery and moving companies provide the appropriate insurance certificates to Building Management BEFORE the delivery arrives. Please refer to the Insurance section of the Tenant Manual for specific instructions. See SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL at the end of this document.

(ii) Any equipment with a “footprint” weight of 500 pounds or greater requires the review and placement approval of the building structural engineer prior to installation. All costs associated with the structural review are the responsibility of the Tenant, except for costs associated with structural review of Tenant’s initial equipment layout.

B. ROUTINE DELIVERIES: Any deliveries for a Datacenter Tenant will be received by Building security into the Building Datacenter Storage Area. This shared storage area is controlled by the Building Management. Once a delivery

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is received, Building Management will send an email to the primary contact for the Tenant notifying them of the delivery. The delivery will only be released to an authorized Tenant representative or a Vendor which has prior authorization. See SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL at the end of this document.

(i) Breakdown of all cartons and crating materials should be done in the Building Datacenter Storage Area prior to transporting the equipment to the Datacenter.

(ii) Additional dedicated storage may be available subject to availability for Tenant use at an additional monthly charge. Contact the Building Management for more information.

12.0 EQUIPMENT INSTALLATION

A. HAMMER DRILLING: All work must conform to the Building drilling policy. The use of the building hammer drill with tool interrupter device or equipment is required if X-rays or Farroscan is not performed. Contact the Building Management to review the current Construction Policies.

(i) If drilling is to be performed, a portable vacuum cleaner must be used during the drilling to minimize the amount of dust particles emitted into the space.

B. SMOKE, DUST, HEAT AND/OR ODOR PRODUCING WORK: Any work such as heat gun use, hammer drilling or metal cutting must be scheduled with Building Engineering at least 24 hours in advance. See SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL at the end of this document. Any such work shall require disabling of the fire alarm enunciation and smoke detectors.

(i) Any fines imposed by the local Fire Department resulting from any events or alarms created by such work will be the full financial responsibility of the Tenant performing such work.

(ii) Extensive dusty work may further require the replacement of HVAC unit filters and an associated charge for this material. The installation of pre-filter media over the HVAC unit intake may be required.

(iii) Any accidental discharge of the fire suppression system caused by a Tenant who violates these rules shall be the full financial responsibility of the Tenant.

C. CONNECTION & ADDITION OF MATERIAL: Additions of ladder racks, cable management tray, fiber guide and floor tile within/above/below any Tenant caged areas must be pre-approved by the Building Management (which pre-approval (or objections) shall be provided within five (5) business days of the

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request or shall be deemed to have been pre-approved) and match the existing system in-place.

(i) All connection points must be “bonded” between sections to maintain the integrity of the existing rack/tray system including appropriate grounding.

(ii) To ensure effective grounding, the paint must be removed by sanding in order to provide a metal contact point for the bonding connection(s). See SAMPLE BUILDING MEETING REQUEST EMAIL at the end of this document.

D. BUILDING SUSPENDED CEILING SYSTEM: Tenants and vendors are not allowed to perform ANY work (i.e. cabling, electrical, conduit, etc.) above the existing Building suspended ceiling within the Datacenter at any time.

E. HOUSEKEEPING: Tenants are expected to keep their area neat and clean. Trash receptacles are provided at each entry to the Datacenter, along with a broom and dust-pan for Tenant utilization.

13.0 TRASH REMOVAL

A. Tenants may request trash removal from the Datacenter by submitting an email to the Building Management.

B. Tenant should label the trash and provide in as tidy of a pile as possible outside of the cage.

C. Building Management will send a day porter to remove the trash and place it into the Building dumpster.

D. Once equipment is unpacked, all cardboard boxes are to be removed from the Datacenter. Dispose of all combustibles….Always.

E. Replace all floor tiles removed for access, before leaving the area.

F. If you need cleaning equipment, contact Building Management.

G. Report any spills or fire hazards so corrective action can be taken.

H. The Day Porter will periodically walk-thru the Datacenter area and any food or drinks will be reported to Building Management.

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14.0 ROOM ACCESS & SECURITY

A. Datacenter access is restricted to personnel with an approved business need. Only designated Tenant Authorizers may approve an individual’s access into the Datacenter.

B. Card access doors control admittance to the Datacenter. Never loan your badge or use another person’s badge for any purpose. Failure to comply will cause your removal from the site.

C. If you should lose your ID badge, immediately report it to Building Security so it can be deactivated.

D. Do not allow others to tailgate into a controlled space behind you. Tailgating is a way for someone who lacks authorization to enter a restricted space. Each person must use the badge access system to facilitate their own access by use of their own badge. Conversely, you must not follow another person into any restricted space without having separately used your own badge to unlock the door into that space.

E. The badge access system may require that you pass your badge by a reader in order to exit the Datacenter. This process will provide greater awareness of occupancy in the event of an emergency.

F. Do not attempt to enter areas to which you are not authorized.

G. The Datacenter is under 24-hour closed circuit TV cameras surveillance. Cameras are deployed within the Datacenter and surrounding areas to monitor the security of exits and entrances. Activity viewed by these cameras is recorded and may be used for investigative purposes or when a security policy, such as tailgating, is violated.

H. Tampering with the camera equipment is strictly prohibited and will result in immediate dismissal from the Building.

I. Emergency power-off (EPO) buttons are located adjacent to the exit doors within the Datacenter for use in an absolute emergency situation where the shutdown of power is necessary to prevent loss of life or to prevent the spread of a significant electrical fire.

J. The room is secured with a “fail-safe” access control system utilizing either access card and/or biometric based.

K. All doors into the Datacenter and other restricted space must not be propped open for any length of time. You should ensure that each controlled access door closes immediately after you enter.

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L. Each Tenant must provide Building Management an approved “access list” of personnel allowed to access the Datacenter. Access will be denied if an individual is not on the Tenant provided list.

M. Non-Emergency access to the Datacenter by a vendor representing a Tenant must be arranged at least 12 hours in advance, and must be provided in writing to Building Management. All requests must describe in detail the planned scope of work. See SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL at the end of this document.

N. Emergency access after hours requires a phone call to the Building Security by the Tenant, with a complete description of the scope of work and the nature of the emergency. Some work scope may require the approval of the on-call Building Engineer prior to granting access to the vendor.

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15.0 APPROVED LABELING AND BINDING MATERIALS FOR INTERSPACE CABLING.

APPROVED CABLE GROUPING MATERIALS

.

APPROVED CABLE IDENTIFICATION METHODS

APPROVED CABLE AND ELECTRICAL CIRCUIT IDENTIFICATION METHODS

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16.0 SAMPLE VENDOR AUTHORIZATION REQUEST EMAIL

To:    Building Manager

From: AnyCompany

Subject: Access and Authorization Request

AnyCompany will need to have clearance for the following activities in the Datacenter Suite 700:

1.) Any Company’s vendor, Install Team, will need access from Jan 2 to Jan 6 for the purposes of equipment installation into existing racks and cable installation. Install Team has insurance on file with the management office.

Personnel for Install Team includes: Bob Jones, Ted Jones, Phil Jones

2.) This work will include the need to utilize a heat gun on Jan 4, 5 and 6. We will need to have the fire suppression system deactivated during these days from 7AM to 4PM each day.

I am the primary contact for all the work that Install Team will be performing. My contact numbers are 555-1212 and 555-1213.

Regards,

John Smith

Operations Manager

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17.0 SAMPLE BUILDING MEETING REQUEST EMAIL

To:    Building Manager

From: AnyTelecom

Subject: Building Engineering Meeting Request

Attachments: racklayout.dwg

AnyTelecom will need to schedule a meeting as soon as possible to discuss addition rack installations in Datacenter A:

Any Telecom’s vendor, Install Team, will need access from Jan 5 to Jan 6 for the purposes of rack installation, tile cuts, grounding and cable management installation in our cage. The proposed installation is shown in the attached file racklayout.dwg. Install Team has insurance on file with the management office.

Personnel for Install Team includes: Bob Jones, Ted Jones, Phil Jones

I am the primary contact for all the work outlined in these meeting requests. My contact numbers are 555-1212 and 555-1213.

Regards,

John Smith

Operations

AnyTelecom

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EXHIBIT “I”

LETTER OF CREDIT PROVISIONS

A. General. As additional consideration for Landlord’s agreement to enter into this Lease, within five (5) days following Tenant’s execution and delivery of this Lease, and as a condition to Landlord’s obligations under the Lease, Tenant covenants and agrees to deliver to Landlord, as additional consideration, an irrevocable letter of credit (the “L/C”) in the form of, and upon all of the terms and conditions contained in, this Exhibit “I” and Appendix “I”, attached hereto. The L/C shall be issued by an institutional lender of good financial standing (which lender shall, in any event, have assets equal to or exceeding $500,000,000 as of the date of issuance of the L/C), having a place of business where the L/C can be presented for payment in Phoenix, Arizona. The lender shall be subject to Landlord’s prior written approval, which approval shall not be unreasonably withheld, conditioned or delayed. The L/C shall provide for one (1) or more draws by Landlord or its transferee up to the aggregate amount of US $81,131.00 (the “L/C Amount”) on the terms and conditions of this Exhibit “I”. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the L/C or any renewal thereof or substitute therefor or any proceeds thereof be deemed to be or treated as a “security deposit” under any Applicable Security Deposit Laws.

B. Renewal of L/C. Tenant shall maintain the L/C in effect from the date which Tenant delivers the L/C to Landlord until the date which is sixty (60) days after Tenant shall have performed all of its obligations under the Lease (said period is hereinafter referred to as the “L/C Term”). If the expiration date of the L/C (or any renewal or replacement L/C provided pursuant to this section) occurs prior to the end of the L/C Term, then Tenant shall deliver to Landlord a renewal of the L/C or a replacement L/C meeting all of the terms and conditions of this section, not later than sixty (60) days prior to the then-applicable expiration date. Each L/C provided pursuant to this section shall have an expiration date which is at least one (1) year from such L/C’s date of issue except where the then-applicable expiration date of the L/C is less than one (1) year from the end of the L/C Term, in which case the renewal or replacement L/C shall be for such lesser period. The issuing bank’s agreement to place an automatic renewal provision in the L/C, as required pursuant to said Appendix “I”, shall not relieve or release Tenant from its obligation to provide a renewal or replacement L/C on the terms hereinabove stated, it being understood that any such automatic renewal is an independent obligation of the issuing bank which is intended for Landlord’s sole benefit. If Tenant fails to provide the renewal or replacement L/C not later than sixty (60) days prior to the then-applicable, stated expiration date (excluding automatic renewal provisions), such failure shall be a default by Tenant, and Landlord shall have the right, without notice or demand, on one or more occasions, to draw upon all or any part of the remaining proceeds of the L/C.

C. Draw on L/C. Landlord may elect from time to time, in Landlord’s sole discretion, without notice or demand to Tenant, to draw upon all or any part of the remaining proceeds of the L/C upon the occurrence of one or more of the following events: (i) Tenant fails to perform any of its obligations under the Lease (including, but not limited to, its obligations under this section), whether or not such failure constitutes a default by Tenant as defined in the Lease; or (ii) Tenant makes any assignment for the benefit of creditors, Tenant declares bankruptcy or is the subject of an involuntary bankruptcy proceeding, a trustee or receiver is appointed to take possession of some or all of Tenant’s assets or, in Landlord’s reasonable judgment, Tenant is insolvent.

D. Application of L/C Proceeds Landlord may elect, from time to time, upon written notice to Tenant, in Landlord’s sole discretion, to apply the proceeds it receives from a draw on the L/C in one or more of the following manners without prejudice to any other remedies: (i) as payment for some or all of the rent or other amounts owed by Tenant under the Lease but unpaid on the date of such draw, (ii) as payment for some or all of the future amounts of rent or other amounts that Landlord estimates will be due and payable under the Lease after the date of the draw, (iii) as payment for some or all of the damage Landlord may suffer as a result of Tenant’s failure to perform its obligations under the Lease, (iv) as collateral for obligations of Tenant under the Lease, and/or (v) in any other manner permitted by the Lease or applicable law. Landlord may make one or more partial draws under the L/C and shall have the right, upon written notice to Tenant, to treat each draw or a portion thereof in one or more of the ways described

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in the previous sentence. Tenant hereby waives any other law or regulation that may be inconsistent with the terms and conditions of this section.

E. Enforcement. Tenant’s obligation to furnish the L/C shall not be released, modified or affected by any failure or delay on the part of Landlord to enforce or assert any of its rights or remedies under the Lease or this section, whether pursuant to the terms thereof or at law or in equity. Landlord’s right to draw upon the L/C shall be without prejudice or limitation to Landlord’s right to draw upon any security deposit provided by Tenant to Landlord or to avail itself of any other rights or remedies available to Landlord under the Lease, as amended hereby, or at law or equity.

F. Event of Default. Tenant’s failure to perform its obligations under this Exhibit “I” (time being of the essence) shall constitute an Event of Default under the Lease and shall entitle Landlord to immediately exercise all of its rights and remedies under the Lease (including, but not limited to rights and remedies under this Exhibit “I”) or at law or in equity without notice or demand to Tenant.

G. Conflict. If there is any conflict between the terms and conditions of this Exhibit “I” and the terms and conditions of the Lease, as amended by this Amendment, the terms of this Exhibit “I” shall control.

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APPENDIX “I”

LETTER OF CREDIT

[INSERT LENDER INFO]

Contact Phone:

Email :

IRREVOCABLE STANDBY LETTER OF CREDIT

Date:                     , 2007 Letter of Credit #                                     

DIGITAL PHOENIX VAN BUREN, LLC (“Beneficiary”)

c/o Digital Realty Trust

560 Mission Street, Suite 2900

San Francisco, California 94104

Attn: Charissa Tran

Ladies and Gentlemen:

At the request and for the account of Danger, Inc., 3101 Park Boulevard, Palo Alto, California 94306, we hereby establish our irrevocable standby Letter of Credit in your favor in the amount of Eighty-One Thousand One Hundred Thirty-One Dollars (U.S. $81,131.00) available with us by sight payment of your signed and dated written statement(s) containing the wording specified below:

(1) Beneficiary’s statement signed by an authorized officer stating that: “The amount of this drawing under this irrevocable standby letter of credit is being drawn pursuant to the Turn Key Datacenter Lease dated                      by and between Digital Phoenix Van Buren, LLC (“Beneficiary”) and Danger, Inc. (“Applicant”).”

All Drafts must be marked: “Drawn Under                                  [name of lender] Standby Letter of Credit Number                                  dated                     ”, and may be presented by facsimile, registered or certified mail or overnight courier.

This letter of credit is transferable one or more times. Transfer of this letter of credit is subject to our receipt of beneficiary’s instructions in the form attached hereto as Exhibit A accompanied by the original letter of credit and amendment(s) if any. Costs or expenses of such transfer shall be for the account of the Applicant.

We hereby agree with you that each drawing presented hereunder in full compliance with the terms hereof will be duly honored by our payment to you of the amount of such drawing, in immediately available funds of                                  [name of lender] not later than the Business Day following the Business Day on which such drawing is presented to us for payment.

This Letter of Credit expires at our above-specified office on                      (the “Expiration Date”), but the Expiration Date shall be automatically extended without amendment for a period of one (1) year from the Expiration Date, and on each successive expiration date, unless at least sixty (60) days before the then current expiration date, we notify you by registered mail or overnight courier service at the above address that this Letter of Credit is not extended beyond the current expiration date. Upon your receipt of such notice you may draw on us by means of presenting your sight draft drawn on                      [name of lender] up to the full available amount accompanied by the original of this Letter of Credit and Amendment(s), if any, presented by registered or certified mail or overnight courier.

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Partial and multiple drawings are permitted under this Letter of Credit.

This Letter of Credit is subject to International Standby Practices (ISP98), International Chamber of Commerce Publication No. 590 and engages us in accordance with the terms thereof.

We hereby engage with you that each demand drawn and presented to us in compliance with the terms and provisions of this Letter of Credit will be duly honored by payment to you.

Very truly yours,
	[lender]

By:

Title:

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EXHIBIT A

TO                                  [name of lender]

IRREVOCABLE STANDBY LETTER OF CREDIT NO.                     

(Letter of Credit)

REQUEST FOR TRANSFER OF

IRREVOCABLE STANDBY LETTER OF CREDIT NO.                     

                    , 2        

TO:	[name of lender]
RE:	IRREVOCABLE STANDBY LETTER OF CREDIT NO.

WE REQUEST YOU TO TRANSFER ALL OF OUR RIGHTS AS BENEFICIARY UNDER THE IRREVOCABLE STANDBY LETTER OF CREDIT REFERENCED ABOVE TO THE NEW BENEFICIARY NAMED BELOW WHO HAS SUCCEEDED US AS LANDLORD:

[NAME OF NEW BENEFICIARY]

[ADDRESS]

BY THIS TRANSFER, ALL OUR RIGHTS AS THE ORIGINAL BENEFICIARY, INCLUDING ALL RIGHTS TO MAKE DRAWINGS UNDER THE IRREVOCABLE STANDBY LETTER OF CREDIT, GO TO THE NEW BENEFICIARY, WHETHER EXISTING NOW OR IN THE FUTURE, INCLUDING SOLE RIGHTS TO AGREE TO ANY AMENDMENTS, INCLUDING INCREASES OR EXTENSIONS OR OTHER CHANGES. ALL AMENDMENTS WILL BE SENT DIRECTLY TO THE NEW BENEFICIARY WITHOUT THE NECESSITY OF CONSENT BY OR NOTICE TO US.

WE ENCLOSE THE ORIGINAL IRREVOCABLE STANDBY LETTER OF CREDIT AND ANY AMENDMENTS. PLEASE INDICATE YOUR ACCEPTANCE OF OUR REQUEST FOR THE TRANSFER BY ENDORSING THE IRREVOCABLE STANDBY LETTER OF CREDIT AND SEND IT TO THE NEW BENEFICIARY WITH YOUR CUSTOMARY NOTICE OF TRANSFER.

NAME OF BENEFICIARY

NAME OF AUTHORIZED SIGNER AND TITLE

AUTHORIZED SIGNATURE

5

The signature and Title above conform with those shown in our files as authorized to sign for the Beneficiary. Policies governing signature authorization as required for withdrawals from customer accounts shall also be applied to the authorization of signatures on this form.

Name of Bank

Authorized Signature and Title

6

EX-10.29

Exhibit 10.29

LICENCE FOR USE OF ASMEC FACILITIES

ASMEC ADVANCE: OFFICE

Licensor:	Asmec Management Associates Ltd	Licensee:	Danger Limited
	Asmec Centre		5th Floor Alder Castle
	Merlin House		10 Noble Street
	Brunel Road		LONDON
	Theale		EC2V 7QJ
	Berkshire		[herein after called ‘the Licensee”]
	RG7 4AB
	[herein after called “Asmec”]

Date of Licence:		05 July 2006	Licence Fee:	£  7,500.00 per month
Period of Licence:	From:	05 July 2006	VAT:	£  1,312.50
	To:	31 December 2006	Deposit:	£22,500.00

Terms of Agreement

Special Conditions:

1. The current Licence Agreement dated 27 March 2006 is superseded by this now Agreement.

2. The Licence Fee will increase to £7,875 plus VAT on 1st October 2006

3. The deposit will increase to £23,825 on 1st October 2006

4. Should the Licence Agreement continue or be renewed after the initial period of Licence stated above, Asmec confirm that no increase in Licence Fee will be applied until 1st October 2007. Asmec agree that any increase will be by no more than 5% subject to these Licence terms and conditions being adhered to throughout the term.

1. Facilities

The licensee will have use of the office furniture in and 24 hour access to Office Suite No(s) 116, 117 & 118 on the Ground floor in the Asmac Centre at the above address (“the Centre”) together with the telephone answering service between the hours of 8 30 a m and 6 00 p m Monday to Friday inclusive but excluding Bank and Public holidays and other services set out in clause 2 hereof

2. Services

Asmec will provide the following services and facilities to the Licensee, to be included in the Licence Fee:-

i.) lighting electric power, heating and/or air-conditioning in the Office Suite

ii.) daily cleaning of the Office Suite Monday to Friday but excluding Public Holidays

iii.) reception facilities and telephone answering service during normal business hours

iv.) repair and maintenance of the Office Suite and common parts of the Centre

v.) toilet facilities for the use of all Licensee’s employees and guests

vi.) pay all rates building service charges and other outgoings save as otherwise mentioned

vii.) insure all property provided by Asmec for the use of the Licensee [clause 14 defines insurance responsibilities]

3. Fee

The Licensee shall pay to Asmec in advance by monthly bank transfers the Licence Fee plus applicable Value Added Tax before commencement of the period for which the payment is due. After the initial period of licence, Asmec may by one months notice in writing to the Licensee vary the licence fee payable under the terms of this licence provided that if Asmec shall serve notice varying the rate the Licensee shall have the right within 7 days of receipt to give notice to Asmec to determine this licence on the date of expiration of Asmec’s notice

4. Deposit

The Licensee shall upon the signing of this licence pay Asmec a deposit in the amount set forth above which sum will be repaid to the Licensee within one month of the determination of this licence providing payment has been received of all amounts less such amount as may be owing to Asmec by the Licensee at the date of determination under any of the clauses hereof or may be required to remedy any breaches by the Licensee of any obligations contained herein Including the cost of redecoration of the office suite to the extent considered reasonably necessary by Asmec allowing for normal wear and tear but without prejudice to the right of Asmec to recover any greater amount which may be required for such purposes Asmec shall not pay interest on deposits

5. Additional Services

Asmec may make available additional services as it shall in its absolute discretion decide Asmec shall be entitled to terminate the provision of such services at any time and for any reason if Licensee decides to use any such additional services the Licensee shall pay a charge to Asmec for the use thereof as per the rates published from time to time

6. Payment

The Licensee shall be invoiced each month in respect of additional services for which payments are due under the provisions of clause 5, such payments to be made within 15 days of presentation of the invoice. Without prejudice to any other right or remedy or power herein contained or otherwise available to Asmec if any payment whatsoever due under the provisions hereof shall remain

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unpaid for a period exceeding the aforesaid 15 days to pay on demand to Asmec interest thereon at a rate of 8% per year above the base rate for lending for the time being of Barclays Bank plc [or such other UK Bank as Asmec may reasonably designate] from the date when the same became due and until payment thereof [as well as after and before any judgement]

7. Licensee’s Obligations

The Licensee agrees to observe and perform the obligations and conditions contained in the First Schedule hereto and any reasonable additional or substituted obligations made by Asmec In the interests of the proper and efficient running of the Centre and issued to the Licensee such additional or substituted obligations and conditions to be observed and performed within 7 days of written notice being issued

8. Substitution

Asmec reserves the right at its discretion in connection with the management of the Centre to require the Licensee during the existence of this licence to move to a different office in the Centre offering comparable space and facilities following thirty (30) days written notice, but such moves will be limited to one during the period of the licence. Under these circumstances, Asmec will assist with the move on a free of charge basis

9. Termination

This licence shall continue for the period of licence defined by the dates aforementioned [subject to enforced determination as hereinafter provided] but the Licensee shall be required to give not less than three full calendar months written notice to determine this licence on the due termination date.

10. Enforced Determination

Asmec shall be entitled to determine this licence in the event of any payment due from the Licensee being in arrears for 14 days after being formally demanded or of any material breach of the agreements and conditions on the part of the Licensee herein contained remaining unremedied for 14 days after written notice requiring such breach to be remedied has been given by Asmec to the Licensee or of the Licensee becoming insolvent or being a company entering into liquidation whether voluntary or compulsory or of the Licensee entering into any composition or arrangement for the benefit of his or its creditors or suffering any distress or execution to be levied on the Licensee’s goods

Licensee shall be entitled to determine this licence in the event of any material breach of the agreements and conditions on the part of Asmec herein contained remaining unremedied for 14 days after written notice requiring such breach to be remedied has been given by the Licensee to Asmec or of Asmec becoming insolvent or being a company entering into liquidation whether voluntary or compulsory.

11. Notice

Any notice by Asmec under this licence shall be deemed sufficiently served if left in the office suite assigned to the Licensee and an exact copy emailed to Danger Inc’s corporate facilities department at pbergeron@danger.com.

12. Licence

This licence is personal to the Licensee and is not capable of assignment nor shall the Licensee share the use of the office suite or allow the same to be used by any person other than the Licensee or by employees of the Licensee Where two or more persons constitute the Licensee all rights and obligations shall be joint and several and any acts or omissions on the part of employees of the Licensee shall be deemed to be acts or omissions of the Licensee

13. Liability

Asmec shall not be liable in respect of loss or damage however caused in respect of any property of the Licensee kept in the Office Suite or in any part of the Centre or the building nor in respect of any failure to provide any of the services or facilities referred to herein whether under clause 2 or clause 5 unless such loss or damage arises from the intentional misconduct or gross negligence of Asmec or its employees

14. Insurance

Asmec shall insure the building fixtures, fittings and furniture and Asmec’s public and employers liability and shall provide details of such insurance to the licensee on request It is the responsibility of the Licensee to Insure all personal effects and belongings and its own public and employer’s liability

Signed on behalf of Asmec Management Associates Ltd:		Signed on behalf of Licensee:
/s/ Kaye Gibbard		/s/ Henry R. Nothhaft
Name:	Kaye Gibbard	Name:	Henry R. Nothhaft
Position:	Centre Manager	Position:	Signing on behalf of Danger, Inc. the Director of Danger Ltd.
Date:	21 July 2006	Date:	July 13, 2006
		Company:	Danger Ltd.
		Nature of Business: Software and Data Services for Wireless Devices

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THE FIRST SCHEDULE

above referred to

Agreements on the part of the Licensee

1. To use the Office Suite as art office in connection with the Licensee’s business and not for any other purpose whatsoever

2. Not to use the Office Suite for any noxious noisy or offensive trade or business nor for any illegal or immoral act or purpose nor for betting or gaming nor to cause or create any nuisance annoyance or disturbance to Asmec or other occupiers of the Centre or parts thereof nor hold any sale or auction nor hold any public meeting therein nor keep any animals thereon

3. To observe and perform and conform to all regulations and rules which the Licensee has been given notice of in accordance with clause 11 of this Licence:-

i.) made by Asmec for the proper management of the Centre and

ii.) made by the Landlord(s) of the Centre for the proper management of the Centre

and to ensure that his/its employees agents and visitors observe and conform to the same

4. Not to introduce any additional fire or heating apparatus into the Office Suite and not to interfere with the heating and/or air conditioning system therein except by way of controls provided for use by the Licensee

5. Not to interfere with the telephone equipment provided for use by the Licensee except for normal usage purposes and not to introduce any additional telephone equipment into the Office Suite without the prior written consent of Asmec

6. Not to use any electrical apparatus in the Office Suite except calculators and dictation machines and PC based computer systems or install his/its furniture and fittings without the prior written consent of Asmec such consent not to be unreasonably withheld

7. Not to use the Office Suite for the preparation of any food or beverage but use only the kitchen facilities provided

8. Not to store in the Office Suite any article or substances of a specially combustible inflammable explosive or dangerous nature nor to overload the electrical outlets provided in the Office Suite

9. Not to do or permit any employee, agent or visitor to do anything whereby any policy of insurance on the Building or any part thereof or the contents thereof may become void or voidable or which constitutes a breach of any statutory requirement which affects the premises

10. Not to make any alterations or additions to the Office Suite nor to any furniture or fittings provided by Asmec nor to pierce in any way the walls ceilings or floors of the Office Suite or any part of the Centre

11. To use the Office Suite and any other facility within the Centre in such a manner as not to cause any damage to the walls ceilings or floors thereof or to any of the furniture or fittings provided by Asmec and to pay Asmec on demand the reasonable cost of repairing any damage caused

12. Not to assign the benefit of this Licence [the same being personal to the Licensee] nor to sub-licence the Office Suite nor to allow any other person to have occupation or share enjoyment or use of the Office Suite

13. Not to allow the Office Suite[s] to be occupied or used by more than 20 persons unless by prior arrangement with Asmec

14. Not to display any placard or sign in or on any part of the Office Suite or the entrance door or outside the entrance door or in any other part of the Centre or Building save in the place indicated by Asmec and to display in such place only such placards or signs as shall be approved and prepared by Asmec [but at the cost of the Licensee]

15. Not to obstruct or permit to be obstructed the Common Parts or the stairways landings corridors or entrance lobbies of the Centre or of the Building

16. Not to darken or obstruct any windows in the Office Suite nor to display any poster placard advertisement or sign in any window of the Building

17. Not bring any safe or heavy article into the Office Suite or Centre except with the written consent of and in a position designated by Asmec

18. To permit Asmec or its Landlords or the authorised representatives or either of them at all times to inspect clean or decorate and/or carry out works in or on the Office Suite and to enter the Office Suite for all necessary purposes

19. To pay any Value Added Tax imposed by law upon any sum payable under this licence or in respect of any services provided by Asmec to the Licensee

20. To vacate the Office Suite on the date of determination of this Licence [howsoever determined] and to return on that date all equipment belonging to Asmec and all keys and passes prior to vacating the Office Suite and to have no further right to enter the Centre

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21. Asmec shall have a general lien over all property of the Licensee remaining in the Office Suite at the time of the termination of this licence for payment of all monies whatsoever due by the user to Asmec under this licence and such lien may be enforced by sale by auction or private treaty. This lien shall not apply to any intellectual property rights, software, or media staring same, nor to the business books and data records of Licensee.

22. If the Licensee shall leave any property in the Centre after the determination of this licence and shall not have removed the same within 3 working days of notice in writing from Asmec requiring such removal then Asmec may on behalf of the Licensee [and Asmec is hereby appointed by the Licensee to act on their behalf] sell such property and hold the proceeds of sale after deducting the costs of removal storage and sale incurred by it to the order of the Licensee Provided that the Licensee will indemnify Asmec against all costs and claims proceedings and expenses arising out of or in connection with such sale

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EX-10.30

Exhibit 10.30

LOAN AND SECURITY AGREEMENT

THIS LOAN AND SECURITY AGREEMENT (this “Agreement”) dated as of the Effective Date between SILICON VALLEY BANK, a California corporation (“Bank”), and DANGER, INC., a Delaware corporation (“Borrower”), provides the terms on which Bank shall lend to Borrower and Borrower shall repay Bank. The parties agree as follows:

1 ACCOUNTING AND OTHER TERMS

Accounting terms not defined in this Agreement shall be construed following GAAP. Calculations and determinations must be made following GAAP. Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in Section 13. All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein.

2 LOAN AND TERMS OF PAYMENT

2.1 Promise to Pay. Borrower hereby unconditionally promises to pay Bank the outstanding principal amount of all Credit Extensions and accrued and unpaid interest thereon as and when due in accordance with this Agreement.

2.1.1 Revolving Advances.

(a) Availability. Subject to the terms and conditions of this Agreement, Bank shall make Advances not exceeding the Availability Amount. Amounts borrowed hereunder may be repaid and, prior to the Revolving Line Maturity Date, reborrowed, subject to the applicable terms and conditions precedent herein.

(b) Termination; Repayment. The Revolving Line terminates on the Revolving Line Maturity Date, when the principal amount of all Advances, the unpaid interest thereon, and all other Obligations relating to the Revolving Line shall be immediately due and payable.

2.1.2 Letters of Credit Sublimit.

(a) As part of the Revolving Line, Bank shall issue or have issued Letters of Credit for Borrower’s account. Such aggregate amounts utilized hereunder shall at all times reduce the amount otherwise available for Advances under the Revolving Line. The aggregate amount available to be used for the issuance of Letters of Credit may not exceed (i) the lesser of (A) the Revolving Line or (B) One Million Dollars ($1,000,000) plus the Borrowing Base, minus (ii) the outstanding principal amount of any Advances (including any amounts used for Cash Management Services and the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit and any Letter of Credit Reserve) and minus (iii) the FX Reserve. If, on the Revolving Line Maturity Date, there are any outstanding Letters of Credit, then on such date Borrower shall provide to Bank cash collateral in an amount equal to one hundred five percent (105%) of the face amount of all such Letters of Credit plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment), to secure all of the Obligations relating to said Letters of Credit. All Letters of Credit shall be in form and substance acceptable to Bank in its sole discretion and shall be subject to the terms and conditions of Bank’s standard Application and Letter of Credit Agreement (the “Letter of Credit Application”). Borrower agrees to execute any further documentation in connection with the Letters of Credit as Bank may reasonably request. Borrower further agrees to be bound by the regulations and interpretations of the issuer of any Letters of Credit guarantied by Bank and opened for Borrower’s

1.

account or by Bank’s interpretations of any Letter of Credit issued by Bank for Borrower’s account, and Borrower understands and agrees that Bank shall not be liable for any error, negligence, or mistake, whether of omission or commission, in following Borrower’s instructions or those contained in the Letters of Credit or any modifications, amendments, or supplements thereto.

(b) The obligation of Borrower to immediately reimburse Bank for drawings made under Letters of Credit shall be absolute, unconditional, and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, such Letters of Credit, and the Letter of Credit Application.

(c) Borrower may request that Bank issue a Letter of Credit payable in a Foreign Currency. If a demand for payment is made under any such Letter of Credit, Bank shall treat such demand as an Advance to Borrower of the equivalent of the amount thereof (plus fees and charges in connection therewith such as wire, cable, SWIFT or similar charges) in Dollars at the then-prevailing rate of exchange in San Francisco, California, for sales of the Foreign Currency for transfer to the country issuing such Foreign Currency.

(d) To guard against fluctuations in currency exchange rates, upon the issuance of any Letter of Credit payable in a Foreign Currency, Bank shall create a reserve (the “Letter of Credit Reserve”) under the Revolving Line in an amount equal to ten percent (10%) of the face amount of such Letter of Credit. The amount of the Letter of Credit Reserve may be adjusted by Bank from time to time to account for fluctuations in the exchange rate. The availability of funds under the Revolving Line shall be reduced by the amount of such Letter of Credit Reserve for as long as such Letter of Credit remains outstanding.

2.1.3 Foreign Exchange Sublimit. As part of the Revolving Line, Borrower may enter into foreign exchange contracts with Bank under which Borrower commits to purchase from or sell to Bank a specific amount of Foreign Currency (each, a “FX Forward Contract”) on a specified date (the “Settlement Date”). FX Forward Contracts shall have a Settlement Date of at least one (1) FX Business Day after the contract date and shall be subject to a reserve of ten percent (10%) of each outstanding FX Forward Contract in a maximum aggregate amount not to exceed (a) the lesser of (i) the Revolving Line or (ii) One Million Dollars ($1,000,000) plus the Borrowing Base minus (b) the amount of all outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), minus (c) any amounts used for Cash Management Services, and minus (d) the outstanding principal balance of any Advances (the “FX Reserve”). The aggregate amount of FX Forward Contracts at any one time may not exceed ten (10) times the amount of the FX Reserve.

2.1.4 Cash Management Services Sublimit. Borrower may use the Revolving Line for Bank’s cash management services which may include merchant services, direct deposit of payroll, business credit card, and check cashing services identified in Bank’s various cash management services agreements (collectively, the “Cash Management Services”) in an amount not to exceed (a) the lesser of (i) the Revolving Line or (ii) One Million Dollars ($1,000,000) plus the Borrowing Base minus (b) the amount of all outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), minus (c) the FX Reserve, and minus (d) the outstanding principal balance of any Advances. Any amounts used by Borrower for Cash Management Services will be treated as Advances under the Revolving Line, will accrue interest at the interest rate applicable to Advances, and will reduce the amount otherwise available for Credit Extensions thereunder.

2.1.5 Term Loan.

(a) Availability. Bank shall make a term loan available to Borrower in an aggregate amount not to exceed the Term Loan Amount, which term loan shall be advanced on or before March 31,

2.

2008 in not more than three (3) advances of at least One Million Dollars ($1,000,000) each, subject to the satisfaction of the terms and conditions of this Agreement.

(b) Repayment. Borrower shall repay each Term Loan Advance in (i) thirty-six equal installments of principal plus accrued interest beginning on the later of (i) January 1, 2008 or (ii) first (1^st) day of the month following the month in which the Funding Date of the applicable Term Loan Advance occurs, and continuing on the first day of each month thereafter (each such payment being hereinafter referred to as a “Term Loan Payment”). For each Term Loan Advance prior to December 1, 2007 Borrower shall pay all accrued interest with respect to any such advance on the first (1^st) day of the month following the month in which the Funding Date occurs and on the first (1^st) day of each month thereafter through December 1, 2007. Borrower’s final Term Loan Payment shall include all outstanding principal and accrued and unpaid interest under the applicable Term Loan Advance as of the date of the final Term Loan Payment.

(c) Prepayment. Provided that no Event of Default has occurred and is continuing, Borrower may prepay the Term Loan in whole or in part. No prepayment penalty or prepayment fee shall be due with regard to any prepayment of the Term Loan. Partial payments of the Term Loan shall be applied in inverse order of maturity, pro rata based on the original principal amount of each Term Loan Advance.

2.2 Overadvances. If, at any time, the Credit Extensions under Sections 2.1.1, 2.1.2, 2.1.3 and 2.1.4 exceed the lesser of either (a) the Revolving Line or (b) One Million Dollars ($1,000,000) plus the Borrowing Base, Borrower shall immediately pay to Bank in cash such excess.

2.3 Payment of Interest on the Credit Extensions.

(a) Interest Rate.

(i) Advances. Subject to Section 2.3(b), the principal amount outstanding under the Revolving Line shall accrue interest at a floating per annum rate equal to one quarter of one percent (0.25%) above the Prime Rate, which interest shall be payable monthly in accordance with Section 2.3(f) below.

(ii) Term Loan. Subject to Section 2.3(b), the principal amount outstanding under the Term Loan shall accrue interest at a fixed per annum rate equal to the three quarters of one percentage point (0.75%) above the Prime Rate, fixed on the Funding Date of the applicable Term Loan Advance, which interest shall be payable monthly.

(b) Default Rate. Immediately upon the occurrence and during the continuance of an Event of Default, Obligations shall bear interest at a rate per annum which is five percentage points above the rate that is otherwise applicable thereto (the “Default Rate”). Payment or acceptance of the increased interest rate provided in this Section 2.3(b) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Bank.

(c) Adjustment to Interest Rate. Changes to the interest rate of any Credit Extension based on changes to the Prime Rate shall be effective on the effective date of any change to the Prime Rate and to the extent of any such change.

(d) 360-Day Year. Interest shall be computed on the basis of a 360-day year for the actual number of days elapsed.

3.

(e) Debit of Accounts. Bank may debit any of Borrower’s deposit accounts, including the Designated Deposit Account, for principal and interest payments or any other amounts Borrower owes Bank when due. These debits shall not constitute a set-off.

(f) Payments. Unless otherwise provided, interest is payable monthly on the first calendar day of each month. Payments of principal and/or interest received after 12:00 p.m. Pacific time are considered received at the opening of business on the next Business Day. When a payment is due on a day that is not a Business Day, the payment is due the next Business Day and additional fees or interest, as applicable, shall continue to accrue.

2.4 Fees. Borrower shall pay to Bank:

(a) Commitment Fee. A fully earned, non-refundable commitment fee of $60,000, on the Effective Date (Bank acknowledges receipt of a $60,000 good faith deposit which it will apply toward payment of this commitment fee);

(b) Letter of Credit Fee. Bank’s customary fees and expenses for the issuance or renewal of Letters of Credit, upon the issuance, each anniversary of the issuance, and the renewal of such Letter of Credit by Bank;

(c) Late Payment Fee. A late payment fee equal to five percent (5%) of any Scheduled Payment or Final Payment not paid when due; and

(d) Bank Expenses. All Bank Expenses (including reasonable attorneys’ fees and expenses, plus expenses, for documentation and negotiation of this Agreement) incurred through and after the Effective Date, when due.

3 CONDITIONS OF LOANS

3.1 Conditions Precedent to Initial Credit Extension. Bank’s obligation to make the initial Credit Extension is subject to the condition precedent that Borrower shall consent to or shall have delivered, in form and substance satisfactory to Bank, such documents, and completion of such other matters, as Bank may reasonably deem necessary or appropriate, including, without limitation:

(a) duly executed original signatures to the Loan Documents to which it is a party;

(b) duly executed original signatures to the Control Agreement(s);

(c) its Operating Documents and a good standing certificate of Borrower certified by the Secretary of State of the State of Delaware as of a date no earlier than thirty (30) days prior to the Effective Date;

(d) duly executed original signatures to the completed Borrowing Resolutions for Borrower;

(e) certified copies, dated as of a recent date, of financing statement searches, as Bank shall request, accompanied by written evidence (including any UCC termination statements) that the Liens indicated in any such financing statements either constitute Permitted Liens or have been or, in connection with the initial Credit Extension, will be terminated or released;

(f) the Perfection Certificate(s) executed by Borrower;

4.

(g) a landlord’s consent executed by Park Place Associates in favor of Bank with respect to Borrower’s headquarters office;

(h) a copy of its Registration Rights Agreement, Investors’ Rights Agreement, and any amendments thereto;

(i) the insurance policies and/or endorsements required pursuant to Section 6.5 hereof; and

(j) payment of the fees and Bank Expenses then due as specified in Section 2.4 hereof.

3.2 Conditions Precedent to all Credit Extensions. Bank’s obligations to make each Credit Extension, including the initial Credit Extension, is subject to the following:

(a) except as otherwise provided in Section 3.4(a), timely receipt of an executed Payment/Advance Form;

(b) the representations and warranties in Section 5 shall be true in all material respects on the date of the Payment/Advance Form and on the Funding Date of each Credit Extension; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, and no Default or Event of Default shall have occurred and be continuing or result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on that date that the representations and warranties in Section 5 remain true in all material respects; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date;

(c) in Bank’s sole discretion, there is not a lack of Investor Support; and

(d) with regard to each Advance but not with regard to any Term Loan Advance, in Bank’s sole discretion, there has not been a Material Adverse Change.

3.3 Covenant to Deliver.

Borrower agrees to deliver to Bank each item required to be delivered to Bank under this Agreement as a condition to any Credit Extension. Borrower expressly agrees that the extension of a Credit Extension prior to the receipt by Bank of any such item shall not constitute a waiver by Bank of Borrower’s obligation to deliver such item, and any such extension in the absence of a required item shall be in Bank’s sole discretion.

3.4 Procedures for Borrowing.

(a) Advances. Subject to the prior satisfaction of all other applicable conditions to the making of an Advance set forth in this Agreement, to obtain an Advance or Term Loan Advance (other than Advances under Sections 2.1.2 or 2.1.4), Borrower shall notify Bank (which notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the Funding Date of the Advance or Term Loan Advance. Together with any such electronic or facsimile notification,

5.

Borrower shall deliver to Bank by electronic mail or facsimile a completed Payment/Advance Form executed by a Responsible Officer or his or her designee. Bank may rely on any telephone notice given by a person whom Bank believes is a Responsible Officer or designee. Bank shall credit Advances and Term Loan Advances to the Designated Deposit Account. Bank may make Advances and Term Loan Advances under this Agreement based on instructions from a Responsible Officer or his or her designee or without instructions if the Advances or Term Loan Advances are necessary to meet Obligations which have become due.

(b) Term Loan. Subject to the prior satisfaction of all other applicable conditions to the making of the Term Loan set forth in this Agreement, if any portion of the proceeds of the Term Loan shall be used to purchase or finance Equipment and Soft Costs (including Equipment and Soft Costs purchased on or after March 1, 2007 if the accompanying equipment invoice is made available to Bank and the Term Loan Advance occurs within thirty (30) days of the Effective Date), Borrower shall deliver to Bank by electronic mail or facsimile a description of such Equipment and Soft Costs and a copy of the invoice for the Equipment to be purchased or financed and the request for the Term Loan.

4 CREATION OF SECURITY INTEREST

4.1 Grant of Security Interest. Borrower hereby grants Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Bank, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof. Borrower represents, warrants, and covenants that the security interest granted herein is and shall at all times continue to be a first priority perfected security interest in the Collateral (subject only to Permitted Liens that may have superior priority to Bank’s Lien under this Agreement). If Borrower shall acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by Borrower of the general 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.

If this Agreement is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations) are repaid in full in cash. Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations) and at such time as Bank’s obligation to make Credit Extensions has terminated, Bank shall, at Borrower’s sole cost and expense, release its Liens in the Collateral and all rights therein shall revert to Borrower. Without limiting the foregoing, upon payment in full in cash of the Obligations (other than the Term Loan Obligations and inchoate indemnity obligations) and at such time as Bank’s commitment to make Advances has terminated, Bank shall, upon written request of Borrower and at Borrower’s sole cost and expense, release its Liens on all Collateral other than Equipment and related assets which are financed under the Term Loan and which are now or hereafter described in one or more invoices delivered to Bank pursuant to Section 3.4(b), together with all of Borrower’s Books relating to such Equipment, and any and all claims, rights and interests in any of such Equipment and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of such Equipment.

4.2 Authorization to File Financing Statements. Borrower hereby authorizes Bank to file financing statements, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Bank’s interest or rights hereunder, including a notice that any disposition of the Collateral in violation of Section 7.1 hereof; by either Borrower or any other Person, shall be deemed to violate the rights of Bank under the Code.

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5 REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants as follows:

5.1 Due Organization, Authorization; Power and Authority. Borrower is duly existing and in good standing as a Registered Organization in its jurisdiction of formation and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property requires that it be qualified except where the failure to do so could not reasonably be expected to have a material adverse effect on Borrower’s business. In connection with this Agreement, Borrower has delivered to Bank signed by Borrower, entitled “Perfection Certificate”. Borrower represents and warrants to Bank that (a) Borrower’s exact legal name is that indicated on the Perfection Certificate and on the signature page hereof; (b) Borrower is an organization of the type and is organized in the jurisdiction set forth in the Perfection Certificate; (c) the Perfection Certificate accurately sets forth Borrower’s organizational identification number or accurately states that Borrower has none; (d) the Perfection Certificate accurately sets forth Borrower’s place of business, or, if more than one, its chief executive office as well as Borrower’s mailing address (if different than its chief executive office); (e) Borrower (and each of its predecessors) has not, in the past five (5) years, changed its jurisdiction of formation, organizational structure or type, or any organizational number assigned by its jurisdiction; and (f) all other information set forth on the Perfection Certificate pertaining to Borrower and each of its Subsidiaries is accurate and complete (it being understood and agreed that Borrower may from time to time update certain information in the Perfection Certificate after the Effective Date by delivery to Bank of an amendment to the Perfection Certificate in form and substance satisfactory Bank). If Borrower is not now a Registered Organization but later becomes one, Borrower shall promptly notify Bank of such occurrence and provide Bank with Borrower’s organizational identification number.

The execution, delivery and performance by Borrower of the Loan Documents to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower’s organizational documents, (ii) contravene, conflict with, constitute a default under or violate any material Requirement of Law, (iii) contravene, conflict or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any its Subsidiaries or any of their property or assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and effect, or (v) constitute an event of default under any material agreement by which Borrower is bound. Except as set forth on the Perfection Certificate, Borrower is not in default under any agreement to which it is a party or by which it is bound in which the default could reasonably be expected to have a material adverse effect on Borrower’s business.

5.2 Collateral. Borrower has good title to, has rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted Liens. Borrower has no deposit accounts other than the deposit accounts with Bank, the deposit accounts, if any, described in the Perfection Certificate delivered to Bank in connection herewith, or of which Borrower has given Bank notice and taken such actions as are necessary to give Bank a perfected security interest therein. The Accounts are bona fide, existing obligations of the Account Debtors.

The Collateral is not in the possession of any third party bailee (such as a warehouse) except as otherwise provided in the Perfection Certificate. None of the components of the Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as Borrower has given Bank notice pursuant to Section 7.2. In the event that Borrower, after the date hereof, intends to store or otherwise deliver any portion of the Collateral to a bailee, then Borrower will first receive the written

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consent of Bank and such bailee must execute and deliver a bailee agreement in form and substance satisfactory to Bank in its sole but reasonable discretion.

5.3 Accounts Receivable. For any Eligible Account in any Borrowing Base Certificate, all statements made and all unpaid balances appearing in all invoices, instruments and other documents evidencing such Eligible Accounts are and shall be true and correct and all such invoices, instruments and other documents, and all of Borrower’s Books are genuine and in all respects what they purport to be. Whether or not an Event of Default has occurred and is continuing, Bank may notify any Account Debtor owing Borrower money of Bank’s security interest in such funds and verify the validity, amount and other matters relating to such Eligible Account. All sales and other transactions underlying or giving rise to each Eligible Account shall comply in all material respects with all applicable laws and governmental rules and regulations. Borrower has no knowledge of any actual or imminent Insolvency Proceeding of any Account Debtor whose accounts are an Eligible Account in any Borrowing Base Certificate. To the best of Borrower’s knowledge, all signatures and endorsements on all documents, instruments, and agreements relating to all Eligible Accounts are genuine, and all such documents, instruments and agreements are legally enforceable in accordance with their terms.

5.4 Litigation. Except as set forth on the Perfection Certificate, there are no actions or proceedings pending or, to the knowledge of the Responsible Officers, threatened in writing by or against Borrower or any of its Subsidiaries involving more than Two Hundred Fifty Thousand Dollars ($250,000).

5.5 No Material Deviation in Financial Statements. All consolidated financial statements for Borrower and any of its Subsidiaries delivered to Bank fairly present in all material respects Borrower’s consolidated financial condition and Borrower’s consolidated results of operations as of the date of such financial statements. There has not been any material deterioration in Borrower’s consolidated financial condition since the date of the most recent financial statements submitted to Bank. Bank acknowledges that Borrower’s revenue recognition policies are under review by Borrower’s accountants.

5.6 Solvency. The fair salable value of Borrower’s assets (including goodwill minus disposition costs) exceeds the fair value of its liabilities (excluding deferred revenue); Borrower is not left with unreasonably small capital after the transactions in this Agreement; and Borrower is able to pay its debts (including trade debts) as they mature.

5.7 Regulatory Compliance. Borrower is not an “investment company” or a company “controlled” by an “investment company” under the Investment Company Act. Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations T and U of the Federal Reserve Board of Governors). Borrower has complied in all material respects with the Federal Fair Labor Standards Act. Neither Borrower nor any of its Subsidiaries is a “holding company” or an “affiliate” of a “holding company” or a “subsidiary company” of a “holding company” as each term is defined and used in the Public Utility Holding Company Act of 2005. Borrower has not violated any laws, ordinances or rules, the violation of which could reasonably be expected to have a material adverse effect on its business. None of Borrower’s or any of its Subsidiaries’ properties or assets has been used by Borrower or any Subsidiary or, to the best of Borrower’s knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than legally. Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Government Authorities that are necessary to continue their respective businesses as currently conducted.

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5.8 Subsidiaries; Investments. Borrower does not own any stock, partnership interest or other equity securities except for Permitted Investments.

5.9 Tax Returns and Payments; Pension Contributions. Borrower has timely filed or obtained extensions for filing all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower. Borrower may defer payment of any contested taxes, provided that Borrower (a) in good faith contests its obligation to pay the taxes by appropriate proceedings promptly and diligently instituted and conducted, (b) notifies Bank in writing of the commencement of, and any material development in, the proceedings, (c) posts bonds or takes any other steps required to prevent the Governmental Authority levying such contested taxes from obtaining a Lien upon any of the Collateral that is other than a “Permitted Lien”. Borrower is unaware of any claims or adjustments proposed for any of Borrower’s prior tax years which could result in additional taxes becoming due and payable by Borrower. Borrower has paid all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms, and Borrower has not withdrawn from participation in, and has not permitted partial or complete termination of, or permitted the occurrence of any other event with respect to, any such plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency.

5.10 Use of Proceeds. Borrower shall use the proceeds of the Advances solely as working capital, and to fund its general business requirements and not for personal, family, household or agricultural purposes, and Borrower shall use the proceeds of the Term Loan solely to finance equipment purchases and Soft Costs and for the build out of the data center, and not for personal, family, household or agricultural purposes.

5.11 Full Disclosure. No written representation, warranty or other statement of Borrower in any certificate or written statement given to Bank, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Bank, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized by Bank that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results).

6 AFFIRMATIVE COVENANTS

Borrower shall do all of the following:

6.1 Government Compliance.

(a) Except as permitted under Section 7.3 as to Subsidiaries, maintain its and all its Subsidiaries’ legal existence and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on Borrower’s business or operations. Borrower shall comply, and have each Subsidiary comply, with all laws, ordinances and regulations to which it is subject, noncompliance with which could have a material adverse effect on Borrower’s business. Borrower shall deliver to Bank good standing certificates of Borrower certified by the Secretary of State of the States of Georgia and Massachusetts not later than ninety (90) days after the Effective Date.

(b) Obtain all of the Governmental Approvals necessary for the performance by Borrower of its obligations under the Loan Documents to which it is a party and the grant of a security

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interest to Bank in all of its property. Borrower shall promptly provide copies of any such obtained Governmental Approvals to Bank.

6.2 Financial Statements, Reports, Certificates.

(a) Deliver to Bank: (i) as soon as available, but no later than thirty (30) days after the last day of each month, a company prepared balance sheet and income statement covering Borrower’s operations for such month certified by a Responsible Officer and in a form acceptable to Bank; (ii) as soon as available, but no later than one hundred twenty (120) days after the last day of Borrower’s fiscal year, audited consolidated financial statements prepared under GAAP, consistently applied, together with an unqualified opinion on the financial statements from an independent certified public accounting firm acceptable to Bank in its reasonable discretion (Bank acknowledges that Borrower’s audited financial statements for the fiscal year ending September 30, 2006 are not available); (iii) within five (5) days of delivery, copies of all statements, reports and notices made generally available to Borrower’s security holders or to any holders of Subordinated Debt (iv) in the event that Borrower becomes subject to the reporting requirements under the Securities Exchange Act of 1934, as amended, within five (5) days of filing, all reports on Form 10-K, 10-Q and 8-K filed with the Securities and Exchange Commission or a link thereto on Borrower’s or another website on the Internet; (v) a prompt report of any legal actions pending or threatened against Borrower or any of its Subsidiaries that could result in damages or costs to Borrower or any of its Subsidiaries of Two Hundred Fifty Thousand Dollars ($250,000) or more; (vi) within thirty (30) days prior to each fiscal year, a business forecast for Borrower’s next fiscal year, including quarterly projected balance sheets, income statements and cash flow statements, (vii) promptly following any request by Bank therefore, budgets, sales projections, operating plans and other information regarding the operations, business affairs and financial condition of Borrower or any of Borrower’s Subsidiaries, or compliance with the terms of this Agreement, as reasonably requested by Bank.

(b) Within thirty (30) days after the last day of each month, deliver to Bank a duly completed Borrowing Base Certificate signed by a Responsible Officer, with aged listings of accounts receivable and accounts payable (by invoice date).

(c) Within thirty (30) days after the last day of each month, deliver to Bank with the monthly financial statements, a duly completed Compliance Certificate signed by a Responsible Officer.

(d) Allow Bank to audit Borrower’s Collateral at Borrower’s expense during normal business hours upon one (1) Business Day’s prior notice. Such audits shall be conducted no more often than once every twelve (12) months unless a Default or an Event of Default has occurred and is continuing. The initial audit shall be completed on or before the earlier to occur of (i) the date thirty (30) days prior to the initial Advance, or (ii) sixty (60) days after the Effective Date. Notwithstanding the foregoing, if an Event of Default has occurred and is continuing, Bank shall not be required to provide notice to Borrower of any audit.

(e) Within thirty (30) days after the last day of each month, deliver to Bank with the monthly financial statements, a cash holding report, including account statements detailing the investment type and maturity dates.

6.3 Inventory; Returns. Keep all Inventory in good and marketable condition, free from material defects. Returns and allowances between Borrower and its Account Debtors shall follow Borrower’s customary practices as they exist at the Effective Date. Borrower must promptly notify Bank of all returns, recoveries, disputes and claims that involve more than Two Hundred Fifty Thousand Dollars ($250,000).

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6.4 Taxes; Pensions. Make, and cause each of its Subsidiaries to make, timely payment or request extensions of payment of all foreign, federal, state, and local taxes or assessments (other than taxes and assessments which Borrower is contesting pursuant to the terms of Section 5.9 hereof) and shall deliver to Bank, on demand, appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms.

6.5 Insurance. Keep its business and the Collateral insured for risks and in amounts standard for companies in Borrower’s industry and location and as Bank may reasonably request. Insurance policies shall be with companies with an A.M. Best Co. rating of at least A- VIII. All property policies shall have a lender’s loss payable endorsement showing Bank as the sole lender loss payee with respect to the Collateral and shall permit Borrower to waive subrogation against Bank (and Borrower hereby waives subrogation against Bank with respect to losses covered by the property policies), and all liability policies shall include, or have endorsements including, Bank as an additional insured. All policies (or the loss payable and additional insured endorsements) shall provide that the insurer shall endeavor to give Bank at least twenty (20) days notice before canceling its policy. At Bank’s request, Borrower shall deliver certificates of insurance and evidence of all premium payments. Proceeds payable under any policy shall, at Bank’s option, be payable to Bank on account of the Obligations. If Borrower fails to obtain insurance as required under this Section 6.5 or to pay any amount or furnish any required proof of payment to third persons and Bank, Bank may make all or part of such payment or obtain such insurance policies required in this Section 6.5, and take any action under the policies Bank deems prudent.

6.6 Operating Accounts.

(a) Maintain either (i) its primary operating account with Bank or (ii) a minimum of Three Million Dollars ($3,000,000) in cash and Cash Equivalents with Bank or Bank’s Affiliates.

(b) Provide Bank five (5) days prior written notice before establishing any Collateral Account at or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account that Borrower at any time maintains, Borrower shall cause the applicable bank or financial institution (other than Bank) at or with which any Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such Collateral Account to perfect Bank’s Lien in such Collateral Account in accordance with the terms hereunder. The provisions of the previous sentence shall not apply to deposit accounts exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such.

6.7 Landlord’s Consent. Within thirty (30) days after Borrower enters into a lease agreement for any Third Party Data Center (as defined below), Borrower shall deliver to Bank a landlord’s consent from the landlord of each and every such Third Party Data Center and on which any of the Collateral is or may hereafter be located, which landlords’ consents must be acceptable to Bank and its counsel in their sole and absolute discretion.

6.8 Amended and Restated Investors’ Rights Agreement. Not later than ninety (90) days after the Effective Date, Borrower shall deliver to Bank an executed copy of the Second Amended and Restated Investors’ Rights Agreement which will amend and restate that certain Amended and Restated Investors’ Rights Agreement dated as of October 2, 2006.

6.9 Protection of Intellectual Property Rights. Borrower shall: (a) protect, defend and maintain the validity and enforceability of its intellectual property; (b) promptly advise Bank in writing of

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material infringements of its intellectual property; and (c) not allow any intellectual property material to Borrower’s business to be abandoned, forfeited or dedicated to the public without Bank’s written consent.

6.10 Litigation Cooperation. From the date hereof and continuing through the termination of this Agreement, make available to Bank, without expense to Bank, Borrower and its officers, employees and agents and Borrower’s books and records, to the extent that Bank may deem them reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or against Bank with respect to any Collateral or relating to Borrower.

6.11 Further Assurances. Execute any further instruments and take further action as Bank reasonably requests to perfect or continue Bank’s Lien in the Collateral or to effect the purposes of this Agreement.

7 NEGATIVE COVENANTS

Borrower shall not do any of the following without Bank’s prior written consent:

7.1 Dispositions. Convey, sell, lease, transfer or otherwise dispose of (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for (a) Transfers of Inventory in the ordinary course of business; (b) for Transfers of worn-out or obsolete Equipment; (c) in connection with Permitted Liens and Permitted Investments; (d) for non-exclusive licenses in the ordinary course of business; and (e) for any other Transfers which in the aggregate do not exceed Two Hundred Fifty Thousand Dollars ($250,000) in any fiscal year.

7.2 Changes in Business, Management, Ownership, or Business Locations. (a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower and such Subsidiary, as applicable, or reasonably related thereto; (b) except as permitted by Section 7.3 as to Subsidiaries, liquidate or dissolve; or (c) (i) if any Key Person ceases to hold such offices with Borrower and is not promptly replaced with another officer satisfactory to Bank in its reasonable discretion or (ii) enter into any transaction or series of related transactions in which the stockholders of Borrower who were not stockholders immediately prior to the first such transaction own more than forty percent (40%) of the voting stock of Borrower immediately after giving effect to such transaction or related series of such transactions (other than by the sale of Borrower’s equity securities in a public offering or to venture capital investors so long as Borrower identifies to Bank the venture capital investors prior to the closing of the transaction). Borrower shall not, without at least thirty (30) days prior written notice to Bank: (1) add any new offices or business locations, including warehouses (unless such new offices or business locations contain less than Two Hundred Fifty Thousand Dollars ($250,000) in Borrower’s assets or property), except for any proposed third party data center location at which financed Equipment is located (a “Third Party Data Center”), (2) change its jurisdiction of organization, (3) change its organizational structure or type, (4) change its legal name, or (5) change any organizational number (if any) assigned by its jurisdiction of organization.

7.3 Mergers or Acquisitions. Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person except where (a) no Event of Default has occurred and is continuing or would result from such transaction, (b) such transaction would not result in a decrease of more than twenty five percent (25%) of Borrower’s Tangible Net Worth, and (c) Borrower is the surviving entity. A Subsidiary may merge or consolidate into another Subsidiary or into Borrower.

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7.4 Indebtedness. Create, incur, assume, or be liable for any Indebtedness, or permit any Subsidiary to do so, other than Permitted Indebtedness.

7.5 Encumbrance. Except for Permitted Liens, create, incur, allow, or suffer any Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, or permit any Collateral not to be subject to the first priority security interest granted herein, or enter into any agreement, document, instrument or other arrangement (except with or in favor of Bank) with any Person which directly or indirectly prohibits or has the effect of prohibiting Borrower from assigning, mortgaging, pledging, granting a security interest in or upon, or encumbering any of Borrower’s intellectual property, except as is otherwise permitted in Section 7.1 hereof and the definition of “Permitted Lien” herein.

7.6 Maintenance of Collateral Accounts. Maintain any Collateral Account except pursuant to the terms of Section 6.6(b) hereof.

7.7 Distributions; Investments. (a) Pay any dividends or make any distribution or payment or redeem, retire or purchase any capital stock provided that (i) Borrower may convert any of its convertible securities into other securities pursuant to the terms of such convertible securities or otherwise in exchange thereof, (ii) Borrower may pay dividends solely in common stock; and (iii) Borrower may repurchase the stock of former employees or consultants pursuant to stock repurchase agreements so long as an Event of Default does not exist at the time of such repurchase and would not exist after giving effect to such repurchase, provided such repurchase does not exceed in the aggregate of Two Hundred Fifty Thousand Dollars ($250,000) per fiscal year; or (b) except as permitted by Section 7.3, directly or indirectly make any Investment other than Permitted Investments, or permit any of its Subsidiaries to do so.

7.8 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for (i) transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with a non-affiliated Person and (ii) transactions that would otherwise be permitted pursuant to subsection (g) of the definition of “Permitted Investments.”

7.9 Subordinated Debt. (a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor, or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to the Subordinated Debt which would increase the amount thereof or adversely affect the subordination thereof to Obligations owed to Bank.

7.10 Compliance. Become an “investment company” or a company controlled by an “investment company”, under the Investment Company Act of 1940 or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit Extension for that purpose; fail to meet the minimum funding requirements of ERISA, permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur; fail to comply with the Federal Fair Labor Standards Act or violate any other law or regulation, if the violation could reasonably be expected to have a material adverse effect on Borrower’s business, or permit any of its Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from participation in, permit partial or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency.

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8 EVENTS OF DEFAULT

Any one of the following shall constitute an event of default (an “Event of Default”) under this Agreement:

8.1 Payment Default. Borrower fails to (a) make any payment of principal or interest on any Credit Extension on its due date, or (b) pay any other Obligations within three (3) Business Days after such Obligations are due and payable (which three (3) day grace period shall not apply to payments due on the Revolving Line Maturity Date or the Term Loan Maturity Date). During the cure period, the failure to cure the payment default is not an Event of Default (but no Credit Extension will be made during the cure period);

8.2 Covenant Default.

(a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.4, 6.5, 6.6, or violates any covenant in Section 7; or

(b) Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 8) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within ten (10) days after the occurrence thereof; provided, however, that if the default cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed thirty (30) days) to attempt to cure such default, and within such reasonable time period the failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period). Grace periods provided under this section shall not apply, among other things, to financial covenants or any other covenants set forth in subsection (a) above;

8.3 Material Adverse Change. A Material Adverse Change occurs; provided, however, that notwithstanding anything to the contrary contained herein, an Event of Default under this Section 8.3 shall be deemed an Event of Default with regard to all Obligations other than the Term Loan Obligations, but shall not be deemed an Event of Default with regard to the Term Loan Obligations.

8.4 Attachment. (a) Any material portion of Borrower’s assets is attached, seized, levied on, or comes into possession of a trustee or receiver in an amount, individually or in the aggregate, in excess of Two Hundred Fifty Thousand Dollars ($250,000); (b) the service of process seeking to attach, by trustee or similar process, any funds of Borrower or of any entity under control of Borrower (including a Subsidiary) on deposit with Bank or any Bank Affiliate; Borrower is enjoined, restrained, or prevented by court order from conducting any part of its business; or (d) a notice of lien, levy, or assessment is filed against any of Borrower’s assets by any government agency, and the same under clauses (a) through (d) hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Credit Extensions shall be made during any ten (10) day cure period;

8.5 Insolvency (a) Borrower is unable to pay its debts (including trade debts) as they become due or otherwise becomes insolvent (excluding deferred revenues when determining liabilities); (b) Borrower begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower and not dismissed or stayed within forty-five (45) days (but no Credit Extensions shall be made while of any of the conditions described in clause (a) exist and/or until any Insolvency Proceeding is dismissed);

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8.6 Other Agreements. There is a default in any agreement to which Borrower is a party with a third party or parties resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount in excess of Two Hundred Fifty Thousand Dollars ($250,000) or that could have a material adverse effect on Borrower’s business;

8.7 Judgments. One or more judgments, orders, or decrees for the payment of money in an amount, individually or in the aggregate, of at least Two Hundred Fifty Thousand Dollars ($250,000) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower and shall remain unsatisfied, unvacated, or unstayed for a period of ten (10) days after the entry thereof (provided that no Credit Extensions will be made prior to the satisfaction, vacation, or stay of such judgment, order, or decree);

8.8 Misrepresentations. Borrower or any Person acting for Borrower makes any representation, warranty, or other statement now or later in this Agreement, any Loan Document or in any writing delivered to Bank or to induce Bank to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made;

8.9 Subordinated Debt. A default or breach occurs under any agreement between Borrower and any creditor of Borrower that signed a subordination, intercreditor, or other similar agreement with Bank, or any creditor that has signed such an agreement with Bank breaches any terms of such agreement;

8.10 Continued Investor Support.

Bank determines, in its good faith judgment, that it is the clear intention of Borrower’s investors to not continue to fund Borrower in the amounts and timeframe necessary to enable Borrower to satisfy the Obligations as they become due and payable; or

8.11 Lien Priority.

There is a material impairment in the priority of Bank’s security interest in the Collateral.

9 BANK’S RIGHTS AND REMEDIES

9.1 Rights and Remedies. While an Event of Default occurs and continues Bank may, without notice or demand, do any or all of the following:

(a) declare all Obligations immediately due and payable (but if an Event of Default described in Section 8.5 occurs all Obligations are immediately due and payable without any action by Bank); provided that, if an Event of Default described in Section 8.3 occurs, Bank may not declare the Term Loan Obligations immediately due and payable based solely on such Event of Default;

(b) stop advancing money or extending credit for Borrower’s benefit under this Agreement or under any other agreement between Borrower and Bank;

(c) demand that Borrower (i) deposits cash with Bank in an amount equal to the aggregate amount of any Letters of Credit remaining undrawn, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance all Letter of Credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit;

(d) terminate any FX Forward Contracts;

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(e) settle or adjust disputes and claims directly with Account Debtors for amounts on terms and in any order that Bank considers advisable, notify any Person owing Borrower money of Bank’s security interest in such funds, and verify the amount of such account;

(f) make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the Collateral. Borrower shall assemble the Collateral if Bank requests and make it available as Bank designates. Bank may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be prior or superior to its security interest and pay all expenses incurred. Borrower grants Bank a license to enter and occupy any of its premises, without charge, to exercise any of Bank’s rights or remedies;

(g) apply to the Obligations any (i) balances and deposits of Borrower it holds, or (ii) any amount held by Bank owing to or for the credit or the account of Borrower;

(h) ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell the Collateral. Bank is hereby granted a non-exclusive, royalty-free license or other right to use without charge, Borrower’s labels, patents, copyrights, mask works, rights of use of any name, trade secrets, trade names, trademarks, service marks, and advertising matter, or any similar property as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and, in connection with Bank’s exercise of its rights under this Section, Borrower’s rights under all licenses and all franchise agreements inure to Bank’s benefit;

(i) place a “hold” on any account maintained with Bank and/or deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any Control Agreement or similar agreements providing control of any Collateral (Bank agrees not to deliver such notice, order, directions or instructions unless an Event of Default has occurred and is continuing);

(j) demand and receive possession of Borrower’s Books; and

(k) exercise all rights and remedies available to Bank under the Loan Documents or at law or equity, including all remedies provided under the Code (including disposal of the Collateral pursuant to the terms thereof).

9.2 Power of Attorney. Borrower hereby irrevocably appoints Bank as its lawful attorney-in-fact, exercisable upon the occurrence and during the continuance of an Event of Default, to: (a) endorse Borrower’s name on any checks or other forms of payment or security; (b) sign Borrower’s name on any invoice or bill of lading for any Account or drafts against Account Debtors; (c) settle and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and on terms Bank determines reasonable; (d) make, settle, and adjust all claims under Borrower’s insurance policies; (e) pay, contest or settle any Lien, charge, encumbrance, security interest, and adverse claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and (f) transfer the Collateral into the name of Bank or a third party as the Code permits. Borrower hereby appoints Bank as its lawful attorney-in-fact to sign Borrower’s name on any documents necessary to perfect or continue the perfection of Bank’s security interest in the Collateral regardless of whether an Event of Default has occurred until all Obligations (other than inchoate indemnity obligations) have been satisfied in full and Bank is under no further obligation to make Credit Extensions hereunder. Bank’s foregoing appointment as Borrower’s attorney in fact, and all of Bank’s rights and powers, coupled with an interest, are irrevocable until all Obligations (other than inchoate indemnity obligations) have been fully repaid and performed and Bank’s obligation to provide Credit Extensions terminates.

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9.3 Protective Payments. If Borrower fails to obtain the insurance called for by Section 6.5 or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under this Agreement or any other Loan Document, Bank may obtain such insurance or make such payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable, bearing interest at the then highest applicable rate, and secured by the Collateral. Bank will make reasonable efforts to provide Borrower with notice of Bank obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Bank are deemed an agreement to make similar payments in the future or Bank’s waiver of any Event of Default.

9.4 Application of Payments and Proceeds. Borrower shall have no right to specify the order or the accounts to which Bank shall allocate or apply any payments required to be made by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application is not specified elsewhere in this Agreement. If an Event of Default has occurred and is continuing, Bank may apply any funds in its possession, whether from Borrower account balances, payments, proceeds realized as the result of any collection of Accounts or other disposition of the Collateral, or otherwise, to the Obligations in such order as Bank shall determine in its sole discretion. Any surplus shall be paid to Borrower or other Persons legally entitled thereto; Borrower shall remain liable to Bank for any deficiency. If Bank, in its good faith business judgment, directly or indirectly enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Bank shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price or deferring the reduction of the Obligations until the actual receipt by Bank of cash therefor.

9.5 Bank’s Liability for Collateral. So long as Bank complies with reasonable banking practices regarding the safekeeping of the Collateral in the possession or under the control of Bank, Bank shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or (d) any act or default of any carrier, warehouseman, bailee, or other Person. Borrower bears all risk of loss, damage or destruction of the Collateral.

9.6 No Waiver; Remedies Cumulative. Bank’s failure, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan Document shall not waive, affect, or diminish any right of Bank thereafter to demand strict performance and compliance herewith or therewith. No waiver hereunder shall be effective unless signed by Bank and then is only effective for the specific instance and purpose for which it is given. Bank’s rights and remedies under this Agreement and the other Loan Documents are cumulative. Bank has all rights and remedies provided under the Code, by law, or in equity. Bank’s exercise of one right or remedy is not an election, and Bank’s waiver of any Event of Default is not a continuing waiver. Bank’s delay in exercising any remedy is not a waiver, election, or acquiescence.

9.7 Demand Waiver. Borrower waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Bank on which Borrower is liable.

10 NOTICES

All notices, consents, requests, approvals, demands, or other communication (collectively, “Communication”) by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S. mail, first class, registered or certified mail return receipt

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requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail or facsimile transmission; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address, facsimile number, or email address indicated below. Bank or Borrower may change its address or facsimile number by giving the other party written notice thereof in accordance with the terms of this Section 10.

If to Borrower:	Danger, Inc.
	3101 Park Blvd.
	Palo Alto, CA 94306
	Attn:	Nancy Hilker, CFO
	Fax:	650 289-5001
	Email:   nhilker@danger.com
If to Bank:	Silicon Valley Bank
	2400 Hanover Street
	Palo Alto, CA 94304
	Attn:	Nina Davies
	Fax:	650 320-0016
	Email:   ndavies@svb.com

11 CHOICE OF LAW, VENUE, JURY TRIAL WAIVER AND JUDICIAL REFERENCE

California law governs the Loan Documents without regard to principles of conflicts of law. Borrower and Bank each submit to the exclusive jurisdiction of the State and Federal courts in Santa Clara County, California; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing suit or taking other legal action in any other jurisdiction to realize on the Collateral or any other security for the Obligations, or to enforce a judgment or other court order in favor of Bank. Borrower expressly submits and consents in advance to such jurisdiction in any action or suit commenced in any such court, and Borrower hereby waives any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consents to the granting of such legal or equitable relief as is deemed appropriate by such court. Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered or certified mail addressed to Borrower at the address set forth in Section 10 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s actual receipt thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid.

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT. EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.

WITHOUT INTENDING IN ANY WAY TO LIMIT THE PARTIES’ AGREEMENT TO WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY, if the above waiver of the right to a trial by jury is not enforceable, the parties hereto agree that any and all disputes or controversies of any nature between them arising at any time shall be decided by a reference to a private judge, mutually

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selected by the parties (or, if they cannot agree, by the Presiding Judge of the Santa Clara County, California Superior Court) appointed in accordance with California Code of Civil Procedure Section 638 (or pursuant to comparable provisions of federal law if the dispute falls within the exclusive jurisdiction of the federal courts), sitting without a jury, in Santa Clara County, California; and the parties hereby submit to the jurisdiction of such court. The reference proceedings shall be conducted pursuant to and in accordance with the provisions of California Code of Civil Procedure §§ 638 through 645.1, inclusive. The private judge shall have the power, among others, to grant provisional relief, including without limitation, entering temporary restraining orders, issuing preliminary and permanent injunctions and appointing receivers. All such proceedings shall be closed to the public and confidential and all records relating thereto shall be permanently sealed. If during the course of any dispute, a party desires to seek provisional relief, but a judge has not been appointed at that point pursuant to the judicial reference procedures, then such party may apply to the Santa Clara County, California Superior Court for such relief. The proceeding before the private judge shall be conducted in the same manner as it would be before a court under the rules of evidence applicable to judicial proceedings. The parties shall be entitled to discovery which shall be conducted in the same manner as it would be before a court under the rules of discovery applicable to judicial proceedings. The private judge shall oversee discovery and may enforce all discovery rules and order applicable to judicial proceedings in the same manner as a trial court judge. The parties agree that the selected or appointed private judge shall have the power to decide all issues in the action or proceeding, whether of fact or of law, and shall report a statement of decision thereon pursuant to the California Code of Civil Procedure § 644(a). Nothing in this paragraph shall limit the right of any party at any time to exercise self-help remedies, foreclose against collateral, or obtain provisional remedies. The private judge shall also determine all issues relating to the applicability, interpretation, and enforceability of this paragraph.

12 GENERAL PROVISIONS

12.1 Successors and Assigns. This Agreement binds and is for the benefit of the successors and permitted assigns of each party. Borrower may not assign this Agreement or any rights or obligations under it without Bank’s prior written consent (which may be granted or withheld in Bank’s discretion). Bank has the right, without the consent of or notice to Borrower, to sell, transfer, negotiate, or grant participation in all or any part of, or any interest in, Bank’s obligations, rights, and benefits under this Agreement and the other Loan Documents.

12.2 Indemnification. Borrower agrees to indemnify, defend and hold Bank and its directors, officers, employees, agents, attorneys, or any other Person affiliated with or representing Bank harmless against: (a) all obligations, demands, claims, and liabilities (collectively, “Claims”) asserted by any other party in connection with the transactions contemplated by the Loan Documents; and (b) all losses or Bank Expenses incurred, or paid by Bank from, following, or arising from transactions between Bank and Borrower (including reasonable attorneys’ fees and expenses), except as to (a) and (b) for Claims and/or losses or Bank Expenses directly caused by Bank’s gross negligence or willful misconduct.

12.3 Time of Essence. Time is of the essence for the performance of all Obligations in this Agreement.

12.4 Severability of Provisions. Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision.

12.5 Amendments in Writing; Integration. All amendments to this Agreement must be in writing and signed by both Bank and Borrower. This Agreement and the Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations between the parties about the

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subject matter of this Agreement and the Loan Documents merge into this Agreement and the Loan Documents.

12.6 Counterparts. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, are an original, and all taken together, constitute one Agreement.

12.7 Survival. All covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations (other than inchoate indemnity obligations and any other obligations which, by their terms, are to survive the termination of this Agreement) have been satisfied. The obligation of Borrower in Section 12.2 to indemnify Bank shall survive until the statute of limitations with respect to such claim or cause of action shall have run.

12.8 Confidentiality. In handling any confidential information, Bank shall exercise the same degree of care that it exercises for its own proprietary information, but disclosure of information may be made: (a) to Bank’s Subsidiaries or Affiliates; (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided, however, Bank shall use commercially reasonable efforts to obtain such prospective transferee’s or purchaser’s agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to Bank’s regulators or as otherwise required in connection with Bank’s examination or audit; and (e) as Bank considers appropriate in exercising remedies under this Agreement. Confidential information does not include information that either: (i) is in the public domain or in Bank’s possession when disclosed to Bank, or becomes part of the public domain after disclosure to Bank through no gross negligence or willful misconduct of Bank; or (ii) is disclosed to Bank by a third party, if Bank does not know that the third party is prohibited from disclosing the information.

12.9 Attorneys’ Fees, Costs and Expenses. In any action or proceeding between Borrower and Bank arising out of or relating to the Loan Documents, the prevailing party shall be entitled to recover its reasonable attorneys’ fees and other costs and expenses incurred, in addition to any other relief to which it may be entitled.

13 DEFINITIONS

13.1 Definitions. As used in this Agreement, the following terms have the following meanings:

“Account” is any “account” as defined in the Code with such additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to Borrower.

“Account Debtor” is any “account debtor” as defined in the Code with such additions to such term as may hereafter be made.

“Advance” or “Advances” means an advance (or advances) under the Revolving Line.

“Affiliate” of any Person is a Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person’s senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person’s managers and members.

“Agreement” is defined in the preamble hereof.

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“Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) One Million Dollars ($1,000,000) plus the Borrowing Base, minus (b) the amount of all outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit) plus an amount equal to the Letter of Credit Reserve, minus (c) the FX Reserve, minus (d) any amounts used for Cash Management Services, and minus (e) the outstanding principal balance of any Advances.

“Bank” is defined in the preamble hereof.

“Bank Expenses” are all audit fees and expenses, costs, and expenses (including reasonable attorneys’ fees and expenses) for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to Borrower.

“Bankruptcy-Related Defaults” is defined in Section 9.1.

“Borrower” is defined in the preamble hereof.

“Borrower’s Books” are all Borrower’s books and records including ledgers, federal and state tax returns, records regarding Borrower’s assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.

“Borrowing Base” means (a) 80% of Eligible Accounts as determined by Bank from Borrower’s most recent Borrowing Base Certificate; provided, however, that Bank may decrease the foregoing percentage in its good faith business judgment based on events, conditions, contingencies, or risks which, as determined by Bank, may adversely affect Collateral, including, without limitation, the results of the initial field examination and on-going periodic exams.

“Borrowing Base Certificate” is that certain certificate in the form attached hereto as Exhibit C.

“Borrowing Resolutions” are, with respect to any Person, those resolutions substantially in the form attached hereto as Exhibit D.

“Business Day” is any day that is not a Saturday, Sunday or a day on which Bank is closed.

“Cash Equivalents” means (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after its creation and having the highest rating from either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.; (c) Bank’s certificates of deposit issued maturing no more than one (1) year after issue; (d) money market funds at least ninety-five percent (95%) of the assets of which constitute Cash Equivalents of the kinds described in clauses (a), (b) and (c) of this definition; and (e) Investments permitted by Borrower’s investment policy, as amended from time to time, provided that such investment policy (and any such amendment thereto) has been approved in writing by Bank.

“Cash Management Services” is defined in Section 2.1.4.

“Code” is the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of California; provided, that, to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code, the definition of such term contained in Article or Division 9 shall govern; provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection,

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or priority of, or remedies with respect to, Bank’s Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the State of California, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes on the provisions thereof relating to such attachment, perfection, priority, or remedies and for purposes of definitions relating to such provisions.

“Collateral” is (a) prior to the termination of the Revolving Line and Bank’s commitment to make Advances, any and all properties, rights and assets of Borrower described on Exhibit A-1, and (b) from and after the termination of the Revolving Line and Borrower’s commitment to make Advances, all Equipment now or hereafter financed under the Term Loan, including without limitation, any and all properties, rights and assets of Borrower described on Exhibit A-2.

“Collateral Account” is any Deposit Account, Securities Account, or Commodity Account.

“Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may hereafter be made.

“Communication” is defined in Section 10.

“Compliance Certificate” is that certain certificate in the form attached hereto as Exhibit E.

“Contingent Obligation” is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation directly or indirectly guaranteed, endorsed, co-made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not include endorsements in the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.

“Control Agreement” is any control agreement entered into among the depository institution at which Borrower maintains a Deposit Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and Bank pursuant to which Bank obtains control (within the meaning of the Code) over such Deposit Account, Securities Account, or Commodity Account.

“Credit Extension” is any Advance, Letter of Credit, Term Loan, FX Forward Contract, amount utilized for Cash Management Services, Term Loan Advance or any other extension of credit by Bank for Borrower’s benefit.

“Default” means any event which with notice or passage of time or both, would constitute an Event of Default.

“Default Rate” is defined in Section 2.3(b).

“Deferred Revenue” is all amounts received or invoiced in advance of performance under contracts and not yet recognized as revenue.

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“Deposit Account” is any “deposit account” as defined in the Code with such additions to such term as may hereafter be made.

“Designated Deposit Account” is Borrower’s deposit account, account number 48600505, maintained with Bank.

“Dollars,” “dollars” and “$” each mean lawful money of the United States.

“Effective Date” is the date Bank executes this Agreement as indicated on the signature page hereof.

“Eligible Accounts” means Accounts which arise in the ordinary course of Borrower’s business that meet all Borrower’s representations and warranties in Section 5.3, Bank reserves the right at any time after the Effective Date to adjust any of the criteria set forth below and to establish new criteria in its good faith business judgment. Eligible Accounts shall not include:

(a) Accounts for which the Account Debtor has not been invoiced;

(b) Accounts that the Account Debtor has not paid within ninety (90) days of invoice date;

(c) Accounts owing from an Account Debtor, fifty percent (50%) or more of whose Accounts have not been paid within ninety (90) days of invoice date;

(d) Accounts with credit balances over ninety (90) days from invoice date;

(e) Accounts owing from an Account Debtor, including Affiliates, whose total obligations to Borrower exceed twenty-five (25%) of all Accounts, except for T-Mobile and T-Mobile’s international Subsidiaries, for which such percentage is 100%, for the amounts that exceed that percentage, unless Bank approves in writing;

(f) Accounts owing from an Account Debtor which does not have its principal place of business in the United States except for Eligible Foreign Accounts;

(g) Accounts owing from an Account Debtor which is a federal, state or local government entity or any department, agency, or instrumentality thereof except for Accounts of the United States if Borrower has assigned its payment rights to Bank and the assignment has been acknowledged under the Federal Assignment of Claims Act of 1940, as amended;

(h) Accounts owing from an Account Debtor to the extent that Borrower is indebted or obligated in any manner to the Account Debtor (as creditor, lessor, supplier or otherwise—sometimes called “contra” accounts, accounts payable, customer deposits or credit accounts), with the exception of customary credits, adjustments and/or discounts given to an Account Debtor by Borrower in the ordinary course of its business;

(i) Accounts for demonstration or promotional equipment, or evaluation units, or in which goods are consigned, or sold on a “sale guaranteed,” “sale or return,” “sale on approval,” “bill and hold,” or other terms if Account Debtor’s payment may be conditional;

(j) Accounts for which the Account Debtor is Borrower’s Affiliate, officer, employee, or agent;

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(k) Accounts in which the Account Debtor disputes liability or makes any claim (but only up to the disputed or claimed amount), or if the Account Debtor is subject to an Insolvency Proceeding, or becomes insolvent, or goes out of business;

(l) Accounts owing from an Account Debtor with respect to which Borrower has received Deferred Revenue (but only to the extent of such Deferred Revenue); and

(m) Accounts for which Bank in its good faith business judgment determines collection to be doubtful.

“Eligible Foreign Accounts” are Accounts for which the Account Debtor does not have its principal place of business in the United States but are otherwise Eligible Accounts that are (a) supported by letter(s) of credit acceptable to Bank; or (b) that Bank approves in writing.

“Equipment” is all “equipment” as defined in the Code with such additions to such term as may hereafter be made, and includes without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of the foregoing.

“ERISA” is the Employee Retirement Income Security Act of 1974, and its regulations.

“Event of Default” is defined in Section 8.

“Foreign Currency” means lawful money of a country other than the United States.

“Funding Date” is any date on which a Credit Extension is made to or on account of Borrower which shall be a Business Day.

“FX Business Day” is any day when (a) Bank’s Foreign Exchange Department is conducting its normal business and (b) the Foreign Currency being purchased or sold by Borrower is available to Bank from the entity from which Bank shall buy or sell such Foreign Currency.

“FX Forward Contract” is defined in Section 2.1.3.

“FX Reserve” is defined in Section 2.1.3.

“GAAP” is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination.

“General Intangibles” is all “general intangibles” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work, whether published or unpublished, any patents, trademarks, service marks and, to the extent permitted under applicable law, any applications therefor, whether registered or not, any trade secret rights, including any rights to unpatented inventions, payment intangibles, royalties, contract rights, goodwill, franchise agreements, purchase orders, customer lists, route lists, telephone numbers, domain names, claims, income and other tax refunds, security and other deposits, options to purchase or sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract,

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tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of insurance and rights to payment of any kind.

“Governmental Approval” is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority.

“Governmental Authority” is any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory organization.

“Indebtedness” is (a) indebtedness for borrowed money or the deferred price of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, and (d) Contingent Obligations.

“Insolvency Proceeding” is any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief.

“Inventory” is all “inventory” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products, including without limitation such inventory as is temporarily out of Borrower’s custody or possession or in transit and including any returned goods and any documents of title representing any of the above.

“Investment” is any beneficial ownership interest in any Person (including stock, partnership interest or other securities), and any loan, advance or capital contribution to any Person.

“Investor Support” means it is the clear intention of Borrower’s investors to continue to fund the Borrower in the amounts and timeframe necessary to enable Borrower to satisfy the Obligations as they become due and payable.

“Key Person” is Borrower’s Chief Executive Officer who is, as of the Effective Date, is Hank Nothhaft.

“Letter of Credit” means a standby letter of credit issued by Bank or another institution based upon an application, guarantee, indemnity or similar agreement on the part of Bank as set forth in Section 2.1.2.

“Letter of Credit Application” is defined in Section 2.1.2(a).

“Letter of Credit Reserve” has the meaning set forth in Section 2.1.2(d).

“Lien” is a claim, mortgage, deed of trust, levy, charge, pledge, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.

25.

“Loan Documents” are, collectively, this Agreement, the Warrant, the Perfection Certificate, any note, or notes or guaranties executed by Borrower or any guarantor, and any other present or future agreement between Borrower any guarantor and/or for the benefit of Bank in connection with this Agreement, all as amended, restated, or otherwise modified.

“Material Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations, or condition (financial or otherwise) of Borrower; or (c) a material impairment of the prospect of repayment of any portion of the Obligations.

“Obligations” are Borrower’s obligation to pay when due any debts, principal, interest, Bank Expenses and other amounts Borrower owes Bank now or later, whether under this Agreement, the Loan Documents (other than the Warrant), or otherwise, including, without limitation, all obligations relating to letters of credit (including reimbursement obligations for drawn and undrawn letters of credit), cash management services, and foreign exchange contracts, if any, and including interest accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower assigned to Bank, and the performance of Borrower’s duties under the Loan Documents, other than the Warrant.

“Operating Documents” are, for any Person, such Person’s formation documents, as certified with the Secretary of State of such Person’s state of formation on a date that is no earlier than 30 days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its limited liability company agreement (or similar agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with all current amendments or modifications thereto.

“Payment/Advance Form” is that certain form attached hereto as Exhibit B.

“Perfection Certificate” is defined in Section 5.1.

“Permitted Indebtedness” is:

(a) Borrower’s Indebtedness to Bank under this Agreement and the other Loan Documents;

(b) Indebtedness existing on the Effective Date and shown on the Perfection Certificate;

(c) Subordinated Debt;

(d) unsecured Indebtedness to trade creditors incurred in the ordinary course of business;

(e) Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business;

(f) Indebtedness secured by Liens described in clause (c) of the definition of “Permitted Liens”;

(g) other Indebtedness not otherwise permitted by Section 7.4 not exceeding Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate outstanding at any time; and

26.

(h) extensions, refinancings, modifications, amendments and restatements of any items of Permitted Indebtedness (a) through (g) above, provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or its Subsidiary, as the case may be.

“Permitted Investments” are:

(a) Investments shown on the Perfection Certificate and existing on the Effective Date;

(b) Cash Equivalents;

(c) Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of Borrower;

(d) Investments consisting of deposit accounts in which Bank has a perfected security interest;

(e) Investments accepted in connection with Transfers permitted by Section 7.1;

(f) Investments of Subsidiaries in or to other Subsidiaries or Borrower and Investments by Borrower in Subsidiaries not to exceed Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate in any fiscal year; provided, however, Borrower may make investments in Danger, Ltd., a limited company organized under the laws of the United Kingdom, consisting of advances in the ordinary course of business to fund payroll, marketing expenses, and operating costs (including data center costs), not to exceed Five Hundred Thousand Dollars ($500,000) in the aggregate per month;

(g) Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers or directors relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by Borrower’s Board of Directors;

(h) Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of business;

(i) Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers who are not Affiliates, in the ordinary course of business; provided that this paragraph (i) shall not apply to Investments of Borrower in any Subsidiary;

(j) joint ventures or strategic alliances consisting of the non-exclusive licensing of technology, the development of technology or the providing of technical support; and

(k) other Investments not otherwise permitted by Section 7.7 not exceeding Fifty Thousand Dollars ($50,000) in the aggregate outstanding at any time; provided, however, that, at the time such Investment is made and after giving effect thereto, no Event of Default has occurred, is continuing or would result from such Investment.

27.

“Permitted Liens” are:

(a) Liens existing on the Effective Date and shown on the Perfection Certificate or arising under this Agreement and the other Loan Documents;

(b) Liens for taxes, fees, assessments or other government charges or levies, either not delinquent or being contested in good faith and for which Borrower maintains adequate reserves on its Books, provided that no notice of any such Lien has been filed or recorded under the Internal Revenue Code of 1986, as amended, and the Treasury Regulations adopted thereunder;

(c) purchase money Liens (including capital leases) (i) on Equipment acquired or held by Borrower incurred for financing the acquisition of the Equipment securing no more than Two Million Five Hundred Thousand Dollars ($2,500,000) in the aggregate amount outstanding, or (ii) existing on Equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the Equipment;

(d) Liens of carriers, warehousemen, suppliers, or other Persons that are possessory in nature arising in the ordinary course of business so long as such Liens are not delinquent or remain payable without penalty or are being contested in good faith and by appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto;

(e) Liens to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA);

(f) Liens incurred in the extension, renewal or refinancing of the indebtedness secured by Liens described in (a) through (c), but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase;

(g) leases or subleases of real property granted in the ordinary course of business, and leases, subleases, non-exclusive licenses or sublicenses of property (other than real property or intellectual property) granted in the ordinary course of Borrower’s business, if the leases, subleases, licenses and sublicenses do not prohibit granting Bank a security interest;

(h) non-exclusive license of intellectual property granted to third parties in the ordinary course of business;

(i) the rights of licensors under licenses of intellectual property to Borrower or its Subsidiaries entered into the ordinary course of business;

(j) bankers’ liens, rights of setoff and similar Liens incurred on deposits made in the ordinary course of business;

(k) Liens arising from attachments or judgments, orders, or decrees in circumstances not constituting an Event of Default under Sections 8.4 and 8.7; and

(l) Liens in favor of other financial institutions arising in connection with Borrower’s deposit and/or securities accounts held at such institutions, provided that Bank has a perfected security interest in the amounts held in such deposit and/or securities accounts.

28.

“Person” is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.

“Prime Rate” is Bank’s most recently announced “prime rate,” even if it is not Bank’s lowest rate.

“Registered Organization” is any “registered organization” as defined in the Code with such additions to such term as may hereafter be made.

“Requirement of Law” is as to any Person, the organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Responsible Officer” is any of the Chief Executive Officer, President, Chief Financial Officer and Controller of Borrower.

“Revolving Line” is an Advance or Advances in an amount equal to Five Million Dollars ($5,000,000.00).

“Revolving Line Maturity Date” is October 11 , 2008.

“Securities Account” is any “securities account” as defined in the Code with such additions to such term as may hereafter be made.

“Settlement Date” is defined in Section 2.1.3.

“Soft Costs” means software, taxes, freight, installation and other soft costs.

“Subordinated Debt” is indebtedness incurred by Borrower subordinated to all of Borrower’s now or hereafter indebtedness to Bank (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Bank entered into between Bank and the other creditor), on terms acceptable to Bank.

“Subsidiary” means, with respect to any Person, any Person of which more than 50.0% of the voting stock or other equity interests (in the case of Persons other than corporations) is owned or controlled directly or indirectly by such Person or one or more of Affiliates of such Person.

“Tangible Net Worth” is, on any date, the consolidated total assets of Borrower and its Subsidiaries minus (a) any amounts attributable to (i) goodwill, (ii) intangible items such as unamortized debt discount and expense, patents, trade and service marks and names, copyrights and research and development expenses except prepaid expenses, (iii) notes, accounts receivable and other obligations owing to Borrower from its officers or other Affiliates, and (iv) reserves not already deducted from assets, and (b) Total Liabilities.

“Term Loan” is a loan made by Bank pursuant to the terms of Section 2.1.5 hereof.

“Term Loan Advance” is an advance under the Term Loan.

“Term Loan Amount” is an amount equal to Seven Million Dollars ($7,000,000.00).

29.

“Term Loan Maturity Date” is the earlier to occur of (a) the due date of the final Term Loan Payment of the last Term Loan Advance, or (b) March 1, 2011.

“Term Loan Obligations” is all principal and accrued interest outstanding under the Term Loan.

“Term Loan Payment” is defined in Section 2.1.5(b).

“Third Party Data Center” is defined in Section 7.2.

“Total Liabilities” is on any day, obligations that should, under GAAP, be classified as liabilities on Borrower’s consolidated balance sheet, including all Indebtedness, and current portion of Subordinated Debt permitted by Bank to be paid by Borrower, but excluding all other Subordinated Debt.

“Transfer” is defined in Section 7.1.

“Warrant” is that certain Warrant to Purchase Stock dated as of the date hereof executed by Borrower in favor of Bank.

[Signature page follows.]

30.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the Effective Date.

BORROWER:
DANGER, INC.
By:	/s/ Henry R. Nothhaft
Name:	Henry R. Nothhaft
Title:	CEO
BANK:
SILICON VALLEY BANK
By:	/s/ Nina Davies
Name:	Nina Davies
Title:	RELATIONSHIP MANAGER
Effective Date: October 12, 2007

31.

EXHIBIT A-1

The Collateral consists of all of Borrower’s right, title and interest in and to the following personal property:

All goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, General Intangibles (except as provided below), commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and

all Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing.

Notwithstanding the foregoing, the Collateral does not include any of the following, whether now owned or hereafter acquired (a) more than 65% of the presently existing and hereafter arising issued and outstanding shares of capital stock owned by Borrower of any Subsidiary of Borrower not incorporated or organized under the laws of one of the states or jurisdictions of the United States which shares entitle the holder thereof to vote for directors or any other matter; (b) any copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work, whether published or unpublished, any patents, patent applications and like protections, including improvements, divisions, continuations, renewals, reissues, extensions, and continuations-in-part of the same, trademarks, service marks and, to the extent permitted under applicable law, any applications therefor, whether registered or not, and the goodwill of the business of Borrower connected with and symbolized thereby, know-how, operating manuals, trade secret rights, rights to unpatented inventions, and any claims for damage by way of any past, present, or future infringement of any of the foregoing; (c) Borrower’s rights in any intellectual property which it licenses from third parties or which it licenses to third parties; provided, however, the Collateral shall include all Accounts, license and royalty fees and other revenues, proceeds, or income arising out of or relating to any of the foregoing; (d) the equipment and other collateral more particularly described in the UCC1 financing statement (file no. 64008033) filed against Borrower by Atel Ventures, Inc. (“Atel”) with the Delaware Secretary of State on October 30, 2006, as amended, provided that the grant of a security interest as provided herein shall extend to, and the term “Collateral” shall include, such equipment and other collateral from and after such time as Borrower’s obligations to Atel have been satisfied in full and Atel has released its lien therein; (e) cash collateral (whether in the form of certificates of deposit, savings accounts, or other arrangements) with Wells Fargo Bank, National Association (“Wells Fargo”) to secure two (2) letters of credit issued for the account of Borrower by Wells Fargo not to exceed Three Hundred Twenty Eight Thousand Dollars ($328,000) in the aggregate at any time, provided that the grant of a security interest as provided herein shall extend to, and the term “Collateral” shall include, such collateral from and after such time as Borrower’s obligations to Wells Fargo have been satisfied in full; or (f) the equipment and other collateral more particularly described in the UCC1 financing statement (file no. 60144956) filed against Borrower by Cisco Systems Capital Corporation (“Cisco”) with the Delaware Secretary of State on January 13, 2006, provided that the grant of a security interest as provided herein shall extend to, and the term “Collateral” shall include, such equipment and other collateral from and after such time as Borrower’s obligations to Cisco have been satisfied in full and Cisco has released its lien therein.

Borrower has agreed not to encumber any of its copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work, whether

1.

published or unpublished, any patents, patent applications and like protections, including improvements, divisions, continuations, renewals, reissues, extensions, and continuations-in-part of the same, trademarks, service marks and, to the extent permitted under applicable law, any applications therefor, whether registered or not, and the goodwill of the business of Borrower connected with and symbolized thereby, know-how, operating manuals, trade secret rights, rights to unpatented inventions, and any claims for damage by way of any past, present, or future infringement of any of the foregoing, without Bank’s prior written consent.

2.

EXHIBIT A-2

The Collateral consists of all right, title and interest of Borrower in and to all Equipment financed by Bank, including the following:

Description of Equipment Make Model Serial # Invoice #

and all Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing.

1.

EXHIBIT B

Loan Payment/Advance Request Form

DEADLINE FOR SAME DAY PROCESSING IS NOON P.S.T.

Fax To: Date:

LOAN PAYMENT:
		Danger, Inc.
From Account #		To Account #
	(Deposit Account #)		(Loan Account #)
Principal $		and/or Interest $
Authorized Signature:		Phone Number:
Print Name/Title:

LOAN ADVANCE:
Complete Outgoing Wire Request section below if all or a portion of the funds from this loan advance are for an outgoing wire.
From Account #		To Account #
	(Loan Account #)	(Deposit
Account #) Amount of Advance $
All Borrower’s representations and warranties in the Loan and Security Agreement are true, correct and complete in all material respects on the date of the request for an advance; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date:
Authorized Signature:		Phone Number                                     :
Print Name/Title:

OUTGOING WIRE REQUEST:
Complete only if all or a portion of funds from the loan advance above is to be wired.
Deadline for same day processing is noon, P.S.T.
Beneficiary Name:	Amount of Wire: $
Beneficiary Bank:	Account Number:
City and State:
Beneficiary Bank Transit (ABA) #:	Beneficiary Bank Code (Swift, Sort, Chip, etc.):
	(For International Wire Only)
Intermediary Bank:	Transit (ABA) #:
For Further Credit to:

Special Instruction:
By signing below, I (we) acknowledge and agree that my (our) funds transfer request shall be processed in accordance with and subject to the terms and conditions set forth in the agreements(s) covering Ands transfer service(s), which agreements(s) were previously received and executed by me (us).
Authorized Signature:	2nd Signature(if required):
Print Name/Title:	Print Name/Title:
Telephone #:	Telephone #:

1.

EXHIBIT C

BORROWING BASE CERTIFICATE

Borrower:	Danger, Inc.
Lender:	Silicon Valley Bank
Commitment Amount:	$5,000,000

ACCOUNTS RECEIVABLE
1.      Accounts Receivable (invoiced) Book Value as of	$
2.      Additions (please explain on reverse)	$
3.      TOTAL ACCOUNTS RECEIVABLE	$
ACCOUNTS RECEIVABLE DEDUCTIONS (without duplication)
4.      Un-invoiced Accounts	$
5.      Amounts over 90 days due	$
6.      Balance of 50% over 90 day accounts	$
7.      Credit balances over 90 days	$
8.      Concentration Limits	$
9.      Foreign Accounts	$
10.    Governmental Accounts	$
11.    Contra Accounts	$
12.    Promotion or Demo Accounts	$
13.    Intercompany/Employee Accounts	$
14.    Disputed Accounts	$
15.    Deferred Revenue	$
16.    Other (please explain on reverse)	$
17.    TOTAL ACCOUNTS RECEIVABLE DEDUCTIONS	$
18.    Eligible Accounts (#3 minus #17)	$
19.    ELIGIBLE AMOUNT OF ACCOUNTS (80% of #18)	$
BALANCES
20.    Maximum Loan Amount	$	5,000,000
21.    Total Funds Available (Lesser of #20 or #19)	$
22.    Present balance owing on Line of Credit	$
23.    Outstanding under Sublimits	$
24.    RESERVE POSITION (#21 minus #22 and #23)	$

The undersigned represents and warrants that this is true, complete and correct, and that the information in this Borrowing Base Certificate complies with the representations and warranties in the Loan and Security Agreement between the undersigned and Silicon Valley Bank.

1.

COMMENTS:
By:		BANK USE ONLY
	Authorized Signer	Received by:
Date:			AUTHORIZED SIGNER
		Date:
		Verified:
			AUTHORIZED SIGNER
		Date:
		Compliance Status:	Yes         No

2.

EXHIBIT D

BORROWING RESOLUTIONS

SVB> Silicon Valley Bank

A Member of SVB Financial Group

CORPORATE BORROWING CERTIFICATE

BORROWER:	Danger, Inc.	DATE:	October 12, 2007
BANK:	Silicon Valley Bank

I hereby certify as follows, as of the date set forth above:

1. I am the Secretary, Assistant Secretary or other officer of the Borrower. My title is as set forth below.

2. Borrower’s exact legal name is set forth above. Borrower is a corporation existing under the laws of the State of Delaware.

3. Attached hereto are true, correct and complete copies of Borrower’s Articles/Certificate of Incorporation (including amendments), as filed with the Secretary of State of the state in which Borrower is incorporated as set forth in paragraph 2 above. Such Articles/Certificate of Incorporation have not been amended, annulled, rescinded, revoked or supplemented, and remain in full force and effect as of the date hereof.

4. The following resolutions were duly and validly adopted by Borrower’s Board of Directors at a duly held meeting of such directors (or pursuant to a unanimous written consent or other authorized corporate action). Such resolutions are in full force and effect as of the date hereof and have not been in any way modified, repealed, rescinded, amended or revoked, and Bank may rely on them until Bank receives written notice of revocation from Borrower.

RESOLVED, that any one of the following officers or employees of Borrower, whose names, titles and signatures are below, may act on behalf of Borrower:

Name	Title	Signature	Authorized to Add or Remove Signatories
Henry R. Nothhaft	Chairman & CEO	/s/ Henry R. Nothhaft	¨
Nancy J. Hilker	Chief Financial Officer	/s/ Nancy J. Hilker	x
Sandra Taylor	VP Finance & Controller	/s/ Sandra Taylor	x

RESOLVED FURTHER, that any one of the persons designated above with a checked box beside his or her name may, from time to time, add or remove any individuals to and from the above list of persons authorized to act on behalf of Borrower.

RESOLVED FURTHER, that such individuals may, on behalf of Borrower:

1.

Borrow Money. Borrow money from Silicon Valley Bank (“Bank”).

Execute Loan Documents. Execute any loan documents Bank requires.

Grant Security. Grant Bank a security interest in any of Borrower’s assets.

Negotiate Items. Negotiate or discount all drafts, trade acceptances, promissory notes, or other indebtedness in which Borrower has an interest and receive cash or otherwise use the proceeds.

Letters of Credit. Apply for letters of credit from Bank.

Foreign Exchange Contracts. Execute spot or forward foreign exchange contracts.

Issue Warrants. Issue warrants for Borrower’s capital stock.

Further Acts. Designate other individuals to request advances, pay fees and costs and execute other documents or agreements (including documents or agreement that waive Borrowers right to a jury trial) they believe to be necessary to effectuate such resolutions.

RESOLVED FURTHER, that all acts authorized by the above resolutions and any prior acts relating thereto are ratified.

5. The persons listed above are Borrower’s officers or employees with their titles and signatures shown next to their names.

By:	/s/ Scott Darling
Name:	Scott Darling
Title:	VP, General Counsel, Secretary

*** If the Secretary, Assistant Secretary or other certifying officer executing above is designated by the resolutions set forth in paragraph 4 as one of the authorized signing officers, this Certificate must also be signed by a second authorized signing officer or director of Borrower.

I, the                                  of Borrower, hereby certify as to paragraphs 1 through 5 above, as of the date set forth above.

                          [print title]

By:

Name:

Title:

2.

EXHIBIT E

COMPLIANCE CERTIFICATE

TO:	SILICON VALLEY BANK	Date:
FROM:	DANGER, INC.

The undersigned authorized officer of Danger, Inc. (“Borrower”) certifies that under the terms and conditions of the Loan and Security Agreement between Borrower and Bank (the “Agreement”), (1) Borrower is in complete compliance for the period ending                          with all required covenants except as noted below, (2) there are no Events of Default, (3) all representations and warranties in the Agreement are true and correct in all material respects on this date except as noted below; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, (4) Borrower, and each of its Subsidiaries, has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except as otherwise permitted pursuant to the terms of Section 5.9 of the Agreement, and (5) no Liens have been levied or claims made against Borrower relating to unpaid employee payroll or benefits of which Borrower has not previously provided written notification to Bank. Attached are the required documents supporting the certification. The undersigned certifies that these are prepared in accordance with GAAP consistently applied from one period to the next except as explained in an accompanying letter or footnotes. The undersigned acknowledges that no borrowings may be requested at any time or date of determination that Borrower is not in compliance with any of the terms of the Agreement, and that compliance is determined not just at the date this certificate is delivered. Capitalized terms used but not otherwise defined herein shall have the meanings given them in the Agreement.

Please indicate compliance status by circling Yes/No under “Complies” column.

Reporting Covenant	Required	Complies
Monthly financial statements with Compliance Certificate	Monthly within 30 days	Yes       No
Annual financial statement (CPA Audited) + CC	FYE within 120 days	Yes       No
10-Q, 10-K and 8-K	Within 5 days after filing with SEC	Yes       No
Borrowing Base Certificate A/R & A/P Agings	Monthly within 30 days	Yes       No
Business Forecast	Within 30 days prior to each fiscal year	Yes       No
Cash Holding Report	Monthly within 30 days	Yes       No

1.

The following are the exceptions with respect to the certification above: (If no exceptions exist, state “No exceptions to note.”)

Danger, Inc.	BANK USE ONLY
By:	Received by:
Name:		AUTHORIZED SIGNER
Title:	Date:
	Verified:
		AUTHORIZED SIGNER
	Date:
	Compliance Status:	Yes        No

2.

EX-21.1

Exhibit 21.1

Subsidiaries of the Registrant

Subsidiary	Jurisdiction of Incorporation
Danger International, Inc.	Delaware
Danger Ltd.*	United Kingdom

* Danger International, Inc. is the sole shareholder of Danger Ltd.

EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use in this Registration Statement on Form S-1 of our report dated December 19, 2007 relating to the consolidated financial statements of Danger, Inc. and subsidiaries (the “Company”) (which report expresses an unqualified opinion and includes an explanatory paragraph regarding the change in the Company’s method of accounting for stock-based compensation in accordance with Financial Accounting Standards Board Statement No. 123 (revised 2004), Share-Based Payment, as described in Note 1 to the consolidated financial statements) appearing in the Prospectus, which is part of this Registration Statement, and to the reference to us under the heading “Experts” in such Prospectus.

/s/ Deloitte & Touche LLP

San Jose, California

December 19, 2007