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T-Mobile and Danger Confidential

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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T-Mobile and Danger Confidential

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.

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T-Mobile and Danger Confidential

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.

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T-Mobile and Danger Confidential

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

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T-Mobile and Danger Confidential

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-ˆ-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

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T-Mobile and Danger Confidential

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

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T-Mobile and Danger Confidential

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.

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T-Mobile and Danger Confidential

(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

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T-Mobile and Danger Confidential

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

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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-

10.

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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

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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

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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.

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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-

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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

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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.

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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.

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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

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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

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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,”

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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.

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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

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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;

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