Falco Terms and Conditions

Unless otherwise expressly provided with respect to a particular sale, all quotations and sales by Digital Scepter Corporation (“Digital”) are made in accordance with, and subject to the following terms and conditions:

1. Payment.

(a) Fees. Service Provider will charge Customer in advance for services unless an alternate payment schedule is set forth in Proposal.

(b) Taxes. Amounts payable by Customer hereunder do not include local, state, or federal sales, use, value-added, or other taxes or tariffs of the United States of America or other countries based on the licenses or services provided under this Agreement or Customer’s use thereof. Customer will pay all such taxes or tariffs as may be imposed upon Service Provider or Customer, except income taxes imposed on Service Provider by the United States of America or any state or local government therein. Customer will be invoiced for, and Customer will pay, any such taxes or tariffs if Service Provider is required to pay them on Customer’s behalf.

(c) Failure to Pay. Customer acknowledges that its failure to pay timely any of the fees payable hereunder, or any portion thereof, will be a material breach of this Agreement for which Service Provider may, in addition to pursuing all other remedies, withhold Services and/or terminate the Agreement.

2. Terms of Payment.

Unless otherwise agreed upon in writing, terms are net cash thirty days from the date of invoice in US dollars (Net 30). Digital reserves the right at any time to require full or partial payment in advance or to revoke any credit previously extended. Overdue payments shall be subject to finance charges computed at a periodic rate (to the extent permitted by law) of 1.5% per month (18% per year). All fees, charges, or other sums payable hereunder shall be customer’s unconditional obligation, to be made without right of abatement, reduction, or set-off of any nature unless approved in writing by a Digital corporate officer.

3. Customer Responsibilities.

(a) Customer Authorized Contact. Customer will identify one individual to be Service Provider’s Authorized Customer contact as noted on first page of Proposal. Customer represents that this person has authorization to make decisions on behalf of Customer and may be relied upon by Service Provider when providing the Services.

(b) Provision of Materials and Services to Service Provider. Customer agrees to timely furnish, at its own expense, all personnel, all necessary computer hardware, software and related materials and appropriate and safe work spaces for purposes of Service Provider performing the Services. Customer will also provide Service Provider with access to all information, passwords, and facilities, requested by Service Provider that is necessary for Service Provider to perform the Services. Access may be denied for any reason at any time, however if access to information, passwords or facilities is denied, Customer understands that the Service Provider may be unable to perform its duties adequately and if such situation should exist, the Service Provider will be held harmless and may terminate this Agreement.

(c) Customer Responsibility for Equipment. If necessary, Customer shall provide a suitable working environment for any Equipment located at Customer’s facility. Such environment includes, but is not limited to, the appropriate temperature, static electricity and humidity controls, and properly conditioned electrical supply for each piece of Equipment. Customer shall bear the risk of loss of any Equipment located at Customer’s facility. (d) Customer acknowledges that from time to time (a) Service Provider may identify additional items that need to be purchased by Customer, and (b) changes in Customer’s systems may be required in order for Service Provider to meet Customer’s requirements. In connection therewith, Customer agrees to work in good faith with Service Provider to effectuate such purchases or changes. In the event that Service Provider is required to purchase any assets, including computer hardware and/or software, in connection with Service Provider providing the Services, all such assets will remain the sole property of Service Provider unless specifically stated otherwise in writing. Customer will be responsible for the quality, completeness and workmanship of any item or service furnished by it and for ensuring that the materials provided to Service Provider do not infringe or violate the rights of any third party. Customer will maintain adequate backup for all data and other items furnished to Service Provider, and Service Provider will not back up Customer’s data stored on any Equipment unless back up services are purchased.

(e) Timeliness. Any timetable for the Services is dependent on timely receipt from Customer of all necessary items and authorizations supplied by it. In the event of a delay in delivery of any such items by Customer, any estimated completion date will be deferred for a period equal to time lost by reason of the delay. The customer agrees to indemnify Digital against all claims where the product was repaired, altered, abused or misused by the customer, its employees and agents, or a third party to this agreement. No suit or action shall be brought against Digital more than one (1) year after the cause of action has accrued.

4. Property Rights.

(a) Service Provider Intellectual Property. The Parties acknowledge and agree that Service Provider may use preexisting proprietary computer software, methodology, techniques, software libraries, tools, algorithms, materials, products, ideas, skills, designs, know-how or other intellectual property owned by Service Provider or its licensors, and Service Provider may also create additional intellectual property based thereon in the performance of the Services (collectively, the “Service Provider Intellectual Property”). Customer agrees that any and all proprietary rights to the Service Provider Intellectual Property, as it existed as of the date hereof and as it may be modified or created in the course of providing the Services, including patent, copyright, trademark, and trade secret rights, to the extent they are available, are the sole and exclusive property of Service Provider, free from any claim or retention of rights thereto on the part of Customer, and Customer hereby assigns to Service Provider any rights it may have in any of the foregoing. (b) Customer Data Ownership and Responsibility. Customer shall have sole responsibility for the accuracy, quality, integrity, legality, reliability, appropriateness, and intellectual property ownership or right to use of any data, information or material proprietary to Customer and provided or submitted by Customer to the Services in the course of using the Services (collectively, “Customer Data”), and Service Provider shall not be responsible for any deletion, correction, destruction, damage, loss or failure to store any Customer Data. In the event this Agreement is terminated, Service Provider shall make available to Customer a file of the Customer Data within thirty (30) days of termination if Customer so requests at the time of termination. (c) Restrictions. Customer will not copy, use, modify, or distribute any Service Provider Intellectual Property except as expressly licensed in this Agreement. Customer will not remove the Service Provider Intellectual Property from any deliverables or cause or permit the modification, distribution, reverse engineering, decompilation, disassembly, or other translation of the Service Provider Intellectual Property. Customer will not alter, change, or remove from the Service Provider Intellectual Property any identification, including copyright and trademark notices, and further agrees to place all such markings on any copies thereof.

5. Relationship of Parties; Non-Solicitation; Non-Circumvention; Non-Disparagement.

(a) Independent Contractor. Service Provider is an independent contractor. Neither party has the right or authority to assume or to create any obligation or responsibility on behalf of the other party. The Falco Agreement shall not be construed to create a joint venture or partnership between the Parties.

(b)** Non-Solicitation.** During any applicable term of this Agreement, whether such term is the Initial Term or any Additional Term, and for a period of one (1) year thereafter, Customer will not, without the prior written approval of the Service Provider, solicit for employment any employee(s) of Service Provider, or directly or indirectly induce any such employee to terminate his or her employment with Service Provider.

(c)** Non-Circumvention.** Customer understands that it may have access to relationships developed by Service Provider while this Agreement is in effect. Customer agrees that Customer shall not contact, either directly or indirectly, any such parties introduced by Service Provider to Customer except as authorized by Service Provider. While this Agreement is in effect, and for a period of one (1) year after termination of this Agreement, Customer shall not, for itself or any third party, solicit, divert or attempt to divert from Service Provider (or any affiliate of it that might be formed) any business. Customer shall not solicit or interfere with any of Service Provider’s customers or vendors. Customer acknowledges that pursuit of the activities forbidden by this paragraph would necessarily involve the use or disclosure of Confidential Information in breach of this Agreement, but that proof of such breach would be extremely difficult.

(d) Non-Disparagement. Customer agrees that for a period of one (1) year following the termination of this Agreement, Customer shall not disparage, in any manner, Service Provider or any of its shareholders, officers, board members, employees, agents, or related parties.

6. Services Warranty.

Service Provider warrants that it will perform the Services substantially in accordance with the specifications set forth in the Falco Agreement. For any breach of the foregoing warranty, Service Provider will exercise commercially reasonable efforts to re-perform any non-conforming services that were performed within the ten (10) business day period immediately preceding the date of Customer’s written notice to Service Provider specifying in reasonable detail such non-conformance.

7. Third Party Products.

Product warranties for third party products, if any, are provided by the manufacturers thereof and not by Service Provider. Service Provider’s sole obligation is to act on behalf of Customer to assist in the satisfaction of any such warranty.

8. Disclaimers.

(a) The express remedies set forth in this Section 8 will constitute Customer’s exclusive remedies, and Service Provider’s sole obligation and liability, for any (a) claim that a Service or deliverable provided hereunder does not conform to specifications or is otherwise defective, or (b) that the Services were performed improperly.

(b) Service Provider shall not be responsible for impairments to the Services caused by acts within the control of Customer or its employees, agents, contractors, suppliers or licensees, the interoperability of Customer applications, or other cause reasonably within Customer’s control and not reasonably related to services provided under this Agreement.

(c) TO THE EXTENT PERMITTED BY APPLICABLE LAW, SERVICE PROVIDER DISCLAIMS ANY AND ALL WARRANTIES EXCEPT FOR THE WARRANTIES MADE BY SERVICE PROVIDER IN SECTION 8, WHICH ARE LIMITED WARRANTIES AND THE ONLY WARRANTIES PROVIDED TO CUSTOMER. THE SERVICES AND DELIVERABLES ARE PROVIDED STRICTLY “AS IS.” SERVICE PROVIDER MAKES NO ADDITIONAL WARRANTIES, EXPRESS, IMPLIED, ARISING FROM COURSE OF DEALING OR USAGE OF TRADE, OR STATUTORY, AS TO THE DELIVERABLES OR SERVICES PROVIDED HEREUNDER, OR ANY MATTER WHATSOEVER. SERVICE PROVIDER DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, SATISFACTORY QUALITY, TITLE AND NON-INFRINGEMENT.

(d) SERVICE PROVIDER DOES NOT WARRANT THAT THE SERVICES OR ANY DELIVERABLES WILL MEET ANY CUSTOMER REQUIREMENTS NOT SET FORTH HEREIN, THAT ANY DELIVERABLES WILL OPERATE IN THE COMBINATIONS THAT CUSTOMER MAY SELECT FOR USE, THAT THE OPERATION OF ANY DELIVERABLES WILL BE UNINTERRUPTED OR ERROR-FREE, THAT ALL ERRORS WILL BE CORRECTED, OR COMPLETELY SECURE. IF PRE-PRODUCTION RELEASES OF SOFTWARE ARE PROVIDED TO CUSTOMER, SUCH COPIES ARE PROVIDED “AS-IS” WITHOUT WARRANTY OF ANY KIND. CUSTOMER ACKNOWLEDGES THAT THERE ARE RISKS INHERENT IN INTERNET CONNECTIVITY THAT COULD RESULT IN THE LOSS OF CUSTOMER’S PRIVACY, CONFIDENTIAL INFORMATION, AND PROPERTY. CUSTOMER IS SOLELY RESPONSIBLE FOR THE SUITABILITY OF THE SERVICES CHOSEN.

(e) No statement by any Service Provider employee or agent, orally or in writing, will serve to create any warranty or obligation not set forth herein or to otherwise modify this Agreement in any way whatsoever.

9. LIMITATION OF LIABILITY

The Parties agree that the allocations of risk made in this Section 9 are reasonable and that they would not enter into the Agreement without these limitations on liability.

(a) SERVICE PROVIDER IS NOT LIABLE FOR ANY INDIRECT, SPECIAL, PUNITIVE, EXEMPLARY, OR CONSEQUENTIAL DAMAGES OF ANY KIND. SERVICE PROVIDER’S LIABILITY TO CUSTOMER ON ACCOUNT OF ANY ACTS OR OMISSIONS RELATED TO THIS AGREEMENT SHALL BE LIMITED TO PROVEN DIRECT DAMAGES IN AN AGGREGRATE NOT TO EXCEED THE LESSER OF: (i) ONE THOUSAND DOLLARS AND NO CENTS ($1,000.00); OR (ii) THE AMOUNTS PAID BY CUSTOMER FOR ANY SERVICES DURING THE MONTH PRECEDING THE INCIDENT GIVING RISE TO THE CLAIM FOR DAMAGES. THESE LIMITATIONS APPLY REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, WARRANTY, STRICT LIABILITY OR TORT.

(b) CUSTOMER HEREBY RELEASES SERVICE PROVIDER FROM ANY LIABILITY FOR LOSS OF DATA TO THE EXTENT THAT THE DATA HAS CHANGED SINCE THE TIME THAT SERVICE PROVIDER WAS LAST REQUIRED BY THE AGREEMENT TO PERFORM A BACK UP. CUSTOMER FURTHER RELEASES SERVICE PROVIDER FROM ALL LIABILITY FOR LOSS OF DATA IF SERVICE PROVIDER IS NOT REQUIRED BY THIS AGREEMENT TO PERFORM BACK UPS OF CUSTOMER’S DATA.

(c) NOTWITHSTANDING ANYTHING ELSE IN THIS AGREEMENT TO THE CONTRARY, THE MAXIMUM AGGREGATE MONETARY LIABILITY OF SERVICE PROVIDER AND ANY OF ITS EMPLOYEES, AGENTS, SUPPLIERS, OR AFFILIATES, UNDER ANY THEORY OF LAW (INCLUDING BREACH OF CONTRACT, TORT, STRICT LIABILITY, AND INFRINGEMENT) SHALL NOT EXCEED THE AMOUNT SET FORTH IN SECTION 11(a).

10. Essential Basis of the Bargain

Customer acknowledges and agrees that the fees charged by Service Provider in this Agreement reflect the overall allocation of risk between the Parties, including by means of the provisions for limitation of liability and exclusive remedies described in this Agreement. Such provisions form an essential basis of the bargain between the Parties and a modification of such provisions would affect substantially the fees charged by Service Provider hereunder. In consideration of such fees, Customer agrees to such allocation of risk and hereby waives any and all rights, through equitable relief of otherwise, to subsequently seek a modification of such provisions or allocation of risk.

11. Force Majeure.

With the exception of Customer payment for services rendered, neither party shall be responsible for any failure to perform or delay caused where such failure or delay is due to circumstances reasonably beyond the Party’s control.

12. Confidentiality

(a) Confidential Information. “Confidential Information” means all information disclosed to Customer, whether before or after the execution of the Agreement, that Customer should reasonably understand to be confidential including: (i) Service Provider’s unpublished prices and other terms of service, audit and security reports, server configuration designs, data center designs (including non-graphic information observed by Customer on a tour of a data center), and other proprietary technology; and (ii) any other information disclosed to Customer that is conspicuously marked as “confidential” or if disclosed in non-tangible form, is verbally designated as “confidential” at the time of disclosure and confirmed as confidential in a written notice given within thirty (30) day of disclosure; but excluding any information which is independently developed by Customer as shown by Customer’s written business records, is or becomes generally available to Customer or the public other than through violation of the Agreement.

(b) Use and Disclosure. Customer shall hold all Confidential Information in confidence, even after termination of this Agreement, and restrict disclosure of such information solely to its employees with a business need to know such information, and use a degree of care no less than the degree of care it uses for its own proprietary information to prevent the unauthorized disclosure, use or publication of such proprietary information.

(c)** Disclosure of Confidential Information.** Notwithstanding anything to the contrary above, Customer agrees that Service Provider may, without notice, (i) report to the appropriate authorities any conduct by Customer (or Customer’s customers or end users) that Service Provider reasonably believes violates applicable law, and (ii) provide any information, including Confidential Information, it has about Customer or its customers or end users that it is required by law or regulation to disclose, or in response to a formal or informal request from a law enforcement or government agency. Service Provider may provide any information, including Confidential Information, it has about Customer or its customers or end users in response to a formal request in a civil action that on its face meets the requirements for such a request.

13. Indemnification.

Except as otherwise provided in this Agreement, Customer shall indemnify, defend and hold harmless Service Provider and its affiliates, officers, managers, employees, members, and any of their successors or assigns, from and against, and shall reimburse Service Provider on demand, for any claim, loss, liability, damage or expense (including reasonable attorneys’ fees and costs of appeal), resulting from Customer’s material breach of this Agreement, use of the Services in violation of any part of this Agreement or applicable law, by any person regardless of whether such person has been authorized to use the Services by Customer, except for unauthorized use that results from Service Provider’s negligence or failure to perform its obligations under the Agreement, or any dispute between persons who claim to have authority to act for Customer in connection with the control of Customer’s account with Service Provider.

14. Injunctive Relief.

Customer acknowledges that the remedy at law for any breach by Customer of the provisions of this Agreement will be inadequate and, accordingly, Customer hereby agrees that, in addition to any other remedy Service Provider may have, Service Provider shall be entitled to an injunction, restraining order or other equitable relief to enforce the terms of this Agreement.

15. Miscellaneous.

(a) Entire Agreement. The Agreement (including the exhibits, schedules and documents referred to herein) constitutes the entire agreement among the Parties and supersedes any prior understandings, agreements, or representations by or among the Parties, written or oral, to the extent they have related in any way to the subject matter hereof.

(b) Modification. The Agreement may not be modified or amended except in a writing signed by a duly authorized representative of each Party that expressly states the sections of this Agreement to be modified; no other act, usage, or custom will be deemed to amend or modify this Agreement. Each Party hereby waives any right it may have to claim that this Agreement was subsequently modified other than in accordance with this Section 15(b).

(c) Assignment. Customer may not assign its rights or obligations under this Agreement without Service Provider’s prior written consent.

(d) Third-Party Beneficiaries. This Agreement is an Agreement between the Parties, and confers no rights upon any of Customer’s employees, agents, contractors, or customer, or upon any other person or entity.

(e) Recitals, Schedules, and Documents. Any and all recitals, exhibits, agreements, schedules and documents referenced in this Agreement are incorporated herein through their respective reference and made a part hereof.

(f) Governing Law and Venue. The Agreement shall be governed by and construed in accordance with the domestic laws of the State of California without giving effect to any choice or conflict of law provisions or rule (whether of the State of California or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of California. The state and federal courts located in San Diego County shall have exclusive jurisdiction of all suits and proceedings arising out of or in connection with this Agreement.

(g) No Modification. Any amendment, addendum, or revision to the Agreement shall be valid only if in writing and signed by the Parties to be bound and against whom or in whose favor such amendment operates.

(h) Binding Effect. This Agreement is binding upon and shall inure to the benefit of the Parties hereto and their respective agents, employees, representatives, officers, directors, partners, members, divisions, co-venturers, stockholders, subsidiaries, affiliates, assigns, successors and predecessors in interest, descendents, dependents, family members, blood relatives, heirs, administrators, executors, and related entities.

(i) Severability. If any part of this Agreement is deemed to be invalid in any court of law, the remaining provisions of this Agreement shall remain in full force and effect, and may be enforced in accordance with the provisions hereof.

(j) Waiver. Any Party may waive compliance by another Party with any of the provisions in this Agreement. No waiver of any provision shall be construed as a waiver of any other provision. A waiver shall not be binding unless executed in writing be the Party making the waiver.

(k) Attorney Fees. The Parties agree that in the event any Party hereto shall initiate legal or arbitration proceedings to enforce performance of any term, covenant, or condition of this Agreement, the prevailing Party shall be entitled to recover from the unsuccessful Party its attorneys’ fees and court/arbitration costs incurred in connection with such proceeding.

(l) Purchase Orders. Customer may, for purposes of administrative convenience, use Customer’s standard form of purchase order to order Services. The Parties understand and agree that any terms or conditions on any such purchase order in any way different from or in addition to the terms and conditions of this Agreement will have no effect whatsoever and Service Provider hereby rejects all such terms and conditions.