Difference between licensing terms of code-server vs. VS Code Server

Question

I am trying to understand the licensing limitations if I want to bundle code-server with my cloud application.

As per the docs, Out of the box, code-server is simply VS Code in the browser

Since code-server uses open source code of VS Code, how does the licensing terms of VS Code Server affect usage of code-server in a commercial application? As per VS Code Server FAQ and licensing terms -

• hosting VS Code Server as a service is not allowed
• you may not provide the software as a stand-alone offering or combine it with any of your applications for others to use, or transfer the software or this agreement to any third party.

So, if I ship code-server helm charts with my commercial cloud application, will it be breaking VS Code Server's license terms?