\n| \n [***]<\/strong><\/p>\n<\/td>\n| \n [***]<\/strong><\/p>\n<\/td>\n| \n [***]<\/strong><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n“Display” <\/strong>means any kind of display or monitor, including a
\nsingle display or multiple integrated displays that are capable of being used
\ntogether to present a unified image.<\/p>\n<\/p>\n“Distributors”<\/strong> means resellers and distributors of
\nBarnes&Noble to the extent they are authorized by Barnes&Noble (directly
\nor indirectly) to resell, license, supply, distribute or otherwise make
\navailable Covered Products.<\/p>\n<\/p>\n“Excluded Technologies<\/strong>” means [***]<\/strong>.<\/p>\n<\/p>\n“eReader<\/strong>” means [***]<\/strong>.<\/p>\n<\/p>\n“General Purpose Computing Device<\/strong>” means any general purpose
\ncomputing device (e.g. server product, personal computer, desktop, laptop,
\nnetbook, slate or tablet), including any device that is designed as, marketed
\nas, or capable (through docking or otherwise) of performing the functions of,
\nsuch general purpose computing devices, and any replacement for any of the
\nforegoing. General Purpose Computing Devices include, for example, versions of
\nthe NOOK Tablet available as of the Effective Date.<\/p>\n<\/p>\n“[***]-Based Functionality<\/strong>” means (i) a system that includes
\n[***]<\/strong> for the purpose of [***]<\/strong>, (ii) logic
\n(whether hardware, software or a combination thereof) for the foregoing system
\n[***]<\/strong>, or combinations of (i) and (ii). For clarification,
\n“[***]<\/strong>-Based Functionality” does not include software or
\nhardware that [***]<\/strong>.<\/p>\n<\/p>\n[***]<\/strong><\/p>\n<\/p>\n“[***] Software<\/strong>” means software, products or services that
\nprovide [***]<\/strong> functionality [***]<\/strong>, whether
\nprovided as software or a service), as well as any [***]<\/strong>
\nfunctionality associated with the foregoing. Notwithstanding the foregoing,
\n[***]<\/strong> Software does not include [***]<\/strong>.<\/p>\n<\/p>\n2<\/p>\n \n
\n“Keyboard<\/strong>” means any kind of keyboard or keypad, including
\ntouch screen, projected and other types of mechanical and non-mechanical
\nkeyboards.<\/p>\n<\/p>\n“License<\/strong>” means the license granted by MICROSOFT to
\nBarnes&Noble under Section 3.1 of this Agreement.<\/p>\n<\/p>\n“[***] Functionality<\/strong>” means functionality that (i)
\nassociates [***]<\/strong> displays [***]<\/strong> or (ii)
\n[***]<\/strong> and displays [***]<\/strong>.<\/p>\n<\/p>\n“NewCo<\/strong>” means an existing or newly formed Affiliate of
\nBarnes&Noble to which Barnes&Noble assigns the Consumer Device Business,
\nconsistent with the Separation.<\/p>\n<\/p>\n“Other Consumer Device<\/strong>” means [***]<\/strong>.<\/p>\n<\/p>\n“Patents<\/strong>” means any and all patents, letters patents,
\nutility models, patent registrations, equivalent rights, applications,
\nprovisional applications and non-provisional applications in all countries of
\nthe world, including all continuations, continuations-in-part, divisionals,
\nsubstitute applications, reissues, reexaminations, renewals and extensions, and
\nall related patents and applications claiming priority from such patents,
\nletters patents, utility models, patent registrations, equivalent rights,
\napplications, provisional applications and non-provisional applications. Patents
\ndo not include design patents, design registrations or trade dress rights.<\/p>\n<\/p>\n“Pre-Installed Software<\/strong>” means [***]<\/strong>.<\/p>\n<\/p>\n“Quarter<\/strong>” means each calendar quarter (January 1 through
\nMarch 31, April 1 through June 30, July 1 through September 30, and October 1
\nthrough December 31).<\/p>\n<\/p>\n“Royalty Period<\/strong>” means each Quarter during the Term, except
\n(i) the first Royalty Period shall commence on the earlier of (A) the commercial
\nrelease of a NOOK Metro style application for Windows 8 pursuant to the
\nCommercial Agreement, or (B) December 31, 2012, (the earlier of (A) or (B), the
\n“Start Date<\/strong>“) and (ii) the last Royalty Period shall end on the
\nlast day of the Term.<\/p>\n<\/p>\n“Separation<\/strong>” means the assignment to NewCo of the Consumer
\nDevice Business, consistent with the separation principles approved by the Board
\nof Directors of Barnes&Noble and provided to MICROSOFT on April 11, 2012.\n<\/p>\n<\/p>\n“Subsidiary<\/strong>” means an Affiliate Controlled by
\nBarnes&Noble.<\/p>\n<\/p>\n“Third Party Software<\/strong>” means [***]<\/strong>.<\/p>\n<\/p>\n“Transfer Price<\/strong>” means the average selling price during the
\nRoyalty Period that is charged by Barnes&Noble and its Affiliates in an
\narms-length transaction for a given brand and model of a Covered Product
\nentering their distribution channel; provided, however, in no event shall the
\nTransfer Price be less than the costs incurred by the manufacturer for buying or
\ncreating the components that comprise the Covered Product.<\/p>\n<\/p>\n3<\/p>\n \n
\n“[***] Functionality<\/strong>” means (i) a [***]<\/strong>
\nsystem with one or more [***]<\/strong> that are able to
\n[***]<\/strong>; (ii) software that [***]<\/strong>; or (iii) any
\ncombination of (i) and (ii), or portions thereof, wherein the primary function
\nof the foregoing (i), (ii) or (iii) is to [***]<\/strong>.<\/p>\n<\/p>\n“Windows Product<\/strong>” means a Covered Product that runs solely
\non a Windows Operating System licensed separately by MICROSOFT to
\nBarnes&Noble or its Affiliates.<\/p>\n<\/p>\nSection 2. Releases<\/em><\/strong><\/p>\n<\/p>\n2.1 Subject to Section 3.5 and Dismissal under Section 3.6, MICROSOFT, on
\nbehalf of itself and its current and future Affiliates, hereby releases and
\nforever discharges Barnes&Noble, its past and current Affiliates and their
\nrespective employees, officers, directors, principals, Covenanted Suppliers and
\nCustomers, acting as such, from any and all claims, actions, causes of action,
\nsuits, damages, injuries, duties, rights, obligations, liabilities, adjustments,
\nresponsibilities, judgments, trespasses, and demands, whatsoever, in law or in
\nequity, whether known or unknown, suspected to exist or unsuspected to exist,
\nwhich were made or could have been made by MICROSOFT alleging infringement
\n(whether direct infringement, contributory infringement or induced infringement)
\nof the Covered Patents based upon (1) the manufacture, use, importation, or sale
\nby Barnes&Noble or its current and past Affiliates of any Covered Products
\nsold by Barnes&Noble or its current or past Affiliates at any time prior to
\nthe Effective Date, or (2) the manufacture, use, importation or sale by
\nCovenanted Suppliers, on behalf of Barnes&Noble or its current or past
\nAffiliates of any Covered Products or any component thereof sold by
\nBarnes&Noble or its current or past Affiliates at any time prior to the
\nEffective Date.For purposes of Sections 3.1 and 3.2, any activity (including but
\nnot limited to making, having made, using, importation, offering for sale or
\nsale) of Barnes & Noble, its current or past Affiliates or its Covenanted
\nSuppliers, with respect to a unit of a Covered Product sold during the Term (or
\nany component thereof), shall be deemed to have been performed during the Term.\n<\/p>\n<\/p>\n 2.2 Subject to Section 3.5 and Dismissal under Section 3.6, MICROSOFT and
\nBarnes&Noble, on behalf of themselves and their current and future
\nAffiliates, hereby release and forever discharge each other and their past and
\ncurrent Affiliates, and their respective employees, officers, directors, and
\nprincipals, acting as such, from all claims, counterclaims, defenses, actions,
\ncauses of action, suits, damages, injuries, duties, rights, obligations,
\nliabilities, adjustments, responsibilities, judgments, trespasses, and demands,
\nwhatsoever, in law or in equity, whether known or unknown, suspected to exist or
\nunsuspected to exist, which were made or could have been made, of any kind or
\nnature arising from or relating in any way to the actions alleged in the
\nLitigations occurring before the Effective Date.<\/p>\n<\/p>\n 2.3 The Parties and their Affiliates expressly waive all rights under any
\nstatutes (such as, for example, California Civil Code \u00a7 1542), legal decisions,
\nor common law principles providing that releases of the type extended in
\nSections 2.1 and 2.2 do not or may not extend to claims which are unknown,
\nunanticipated, or unsuspected at the time such releases are executed.<\/p>\n<\/p>\n 4<\/p>\n \n
\nSection 3. License, Covenant Not to Sue and Dismissal of
\nLawsuits<\/em><\/strong><\/p>\n<\/p>\n3.1 License. Subject to Section 3.5, Dismissal under Section 3.6 and the
\nroyalty payments in Section 4 below, and in consideration for such royalty
\npayments, MICROSOFT, on behalf of itself and its current and future Affiliates,
\nhereby grants to Barnes&Noble and its current Affiliates, effective as of
\nthe Effective Date, a worldwide, nonexclusive, nontransferable (except as
\nspecifically provided for in Section 7.6) and nonsublicensable license under the
\nCovered Patents to make, have made (solely for sale by, for or on behalf of
\nBarnes&Noble or its current Affiliates), use, sell, offer for sale, import,
\nexport, lease, distribute or otherwise transfer (collectively, “Sell,
\n“Sold<\/strong>” or “Sale<\/strong>“) Covered Products during the Term.\n<\/p>\n<\/p>\n3.1.1 Future Subsidiary License. Without limiting Section 7.6, if
\nBarnes&Noble forms or acquires a Subsidiary after the Effective Date, the
\nLicense granted under this Section 3.1 and the Covenant granted under Section
\n3.2 shall extend to such Subsidiary, but effective only as of the date of
\nformation or acquisition of such Subsidiary.<\/p>\n<\/p>\n 3.2 Covenants Not to Sue. Solely with respect to the Covered Products as
\nlicensed under the foregoing Section 3.1 and, for the avoidance of doubt,
\nwithout expanding, increasing or otherwise augmenting the license rights
\nprovided therein, MICROSOFT, on behalf of itself and its current and future
\nAffiliates, hereby covenants not to sue for patent infringement under any
\nCovered Patent (i) any Covenanted Supplier for its manufacture and supply of a
\nCovered Product or any component thereof to Barnes&Noble or its current
\nAffiliates, (ii) any Distributor for its distribution of a Covered Product Sold
\nby, for or on behalf of Barnes&Noble or its current Affiliates, and (iii)
\nany end user for its use of a Covered Product Sold by, for or on behalf of
\nBarnes&Noble or its current Affiliates. For specific units of Covered
\nProducts Sold during the Term, the foregoing covenants will continue for the
\nuseful life of the Covered Products. Notwithstanding anything in this Agreement
\nto the contrary, no Covered Product sold after the Start Date is covered under
\nthe License or Covenant of this Agreement unless a Device Fee for such Covered
\nProduct is paid as a Royalty pursuant to Section 4.<\/p>\n<\/p>\n 3.3 Former Affiliate License. If an Affiliate of Barnes&Noble ceases to
\nbe an Affiliate after the Effective Date, any License or Covenant granted to
\nsuch Affiliate pursuant to this Agreement shall terminate on the date such
\nAffiliate is no longer an Affiliate (“Spin-out Date”); provided, however, that
\nany License or Covenant applicable to specific units of Covered Products Sold by
\nsuch Affiliate prior to the Spin-out Date shall continue for the useful life of
\nsuch Covered Products. Nothing in this Section 3.3 shall limit the ability to
\nassign pursuant to Section 7.6.<\/p>\n<\/p>\n 3.4 Defensive Termination Rights. [***]<\/strong><\/p>\n<\/p>\n3.5 Reservation of Rights. MICROSOFT reserves all rights (and no one receives
\nany rights) not expressly granted by the License and Covenant. No additional
\nrights (including any implied patent licenses, covenants, releases or other
\nrights) are granted by the License or Covenant through implication, estoppel or
\notherwise. Notwithstanding anything to the contrary in this Agreement, MICROSOFT
\nis not bound by, and does not grant any license, covenant or other right or
\nincur any other obligations as a result of, the terms of any license or other
\nagreement with a third party to which Barnes&Noble may be subject. Without
\nlimiting the generality of the foregoing, the License and Covenant do not
\ninclude any license, right or covenant (a) to distribute source code; (b) to any
\nfeatures or functionality not covered by the Covered Patents (e.g. related or
\nenabling technologies); (c) to encumber, license or sublicense the Covered
\nPatents under the terms of any Excluded License or otherwise; or (d) under any
\npatents other than the Covered Patents.<\/p>\n<\/p>\n 5<\/p>\n \n
\n3.6 Dismissal of Litigations. MICROSOFT, Barnes&Noble and
\nbarnesandnoble.com llc agree that (1) within four (4) business days of the
\nEffective Date, MICROSOFT will file a notice of voluntary dismissal without
\nprejudice under Rule 41(a) (1) (A) (i) as to MICROSOFT153s claims against Inventec
\nCorporation in the U.S. District Court for the Western District of Washington,
\nNo. 2:11-cv-00485 RAJ; (2) within four (4) business days of the Effective Date,
\nMICROSOFT, Barnes&Noble and barnesandnoble.com llc will file a joint motion
\nto stay and to refrain from issuing final initial determination of investigation
\nNo. 337-TA-769 in the U.S. International Trade Commission (the “769 ITC
\nInvestigation”) that represents that MICROSOFT, Barnes&Noble and
\nbarnesandnoble.com llc have entered into a settlement agreement that resolves
\nthe dispute before the ITC in the 769 ITC Investigation in its entirety and
\nrequire additional time to prepare a motion to terminate as to all respondents;
\n(3) within five (5) business days of the Effective Date, MICROSOFT,
\nBarnes&Noble and barnesandnoble.com llc will file a joint motion to
\nterminate the 769 ITC Investigation after working in good faith to prepare
\nappropriately redacted versions of all agreements relating to the subject matter
\nof the 769 ITC Investigation that are required to be filed with the motion to
\nterminate; and (4) within five (5) business days after the ITC issues a notice
\nof final determination of termination, MICROSOFT, Barnes&Noble and
\nbarnesandnoble.com llc will file a motion to lift the stay of the action in the
\nU.S. District Court for the Western District of Washington, No. 2:11-cv-00485
\nRAJ, and a joint motion to dismiss MICROSOFT153s claims against Barnes&Noble
\nand barnesandnoble.com llc in that action, with prejudice, and also to dismiss
\nBarnes&Noble and barnesandnoble.com llc153s defenses and counterclaims in that
\naction, with prejudice (termination of such ITC claims and dismissal of such
\nDistrict Court claims, “Dismissal”).<\/p>\n<\/p>\n 3.6.1 The Parties agree that they and their Affiliates shall bear their own
\ncosts and attorneys153 fees relating to the Litigations, their dismissals and the
\nnegotiation of this Agreement.<\/p>\n<\/p>\n Section 4. Payments<\/em><\/strong><\/p>\n<\/p>\n4.1 Royalty Payments.<\/p>\n<\/p>\n 4.1.1 Royalties. For each unit of a Covered Product sold (net of returns) by,
\nfor or on behalf of Barnes&Noble or any of its Affiliates worldwide during
\nthe applicable Royalty Period, Barnes&Noble will pay MICROSOFT the
\napplicable Device Fee for each such Covered Product unit
\n(“Royalties<\/strong>“). For the avoidance of doubt, for each Covered
\nProduct unit sold, a single Device Fee will be paid by Barnes&Noble, or by a
\nparty succeeding to Barnes&Noble153s rights and obligations under this
\nAgreement pursuant to Section 7.6 [***]<\/strong>.<\/p>\n<\/p>\n4.1.2 Royalty Report and Invoice. Within [***]<\/strong> days after
\nthe end of each Royalty Period, whether or not any Royalties are due for the
\napplicable Royalty Period, Barnes&Noble shall submit to MICROSOFT, at its
\naddress for notices under Section 7.4 of this Agreement (with a copy by email to
\nIPNotice@microsoft.com), a completed and accurate royalty report in the form
\nattached as Exhibit A, as the same may be updated from time to time by MICROSOFT
\n(“Royalty Report<\/strong>“). Such Royalty Report will include for each
\ncategory of Covered Products and each brand name and model number in such
\ncategory: (i) the number of units of Covered Products sold during the Royalty
\nPeriod, (ii) the average Transfer Price of the Covered Products sold during the
\nRoyalty Period, and (iii) the total amount of Royalties owed by Barnes&Noble
\nfor the Royalty Period. MICROSOFT shall thereafter invoice Barnes&Noble for
\npayment. Within [***]<\/strong> days after the date of receipt of
\nMICROSOFT153S invoice, Barnes&Noble shall pay to MICROSOFT the amount invoiced
\nfor Royalties owed during such Royalty Period.<\/p>\n<\/p>\n6<\/p>\n \n
\n4.1.3 Records. During the Term and for a period of at least [***]
\n<\/strong>years thereafter, Barnes&Noble shall keep and maintain, and shall
\nrequire each of its Affiliates to keep and maintain, complete and accurate books
\nand records of the number of Covered Products and the Transfer Prices for each
\nmodel and each category of Covered Products sold by or through Barnes&Noble
\nor any of its Affiliates during the Term. Upon not less than
\n[***]<\/strong> days advance written notice from MICROSOFT,
\nBarnes&Noble shall make such books and records available for audit by an
\nindependent certified public accounting firm (together with independent
\ntechnical personnel if and as reasonably required for such accountant to perform
\nthe audit) designated by MICROSOFT and approved by Barnes&Noble, which
\napproval shall not be unreasonably withheld. Unless otherwise agreed by
\nMICROSOFT and Barnes&Noble, any such audit shall be conducted during regular
\nbusiness hours, at Barnes&Noble153s principal place of business, not more
\nfrequently than once in any period of twelve (12) consecutive months and in a
\nmanner that does not unreasonably interfere with Barnes&Noble153s normal
\ncourse of business. Notwithstanding the foregoing, MICROSFT may conduct more
\nthan one audit within a 12 month period if, in MICROSOFT153s good faith judgment,
\nMICROSOFT has a bona fide basis for a Royalty Dispute with Barnes&Noble.<\/p>\n<\/p>\n4.1.4 Discrepancies. If any audit reveals an overpayment, then
\nBarnes&Noble shall receive a credit, in the amount of such overpayment, that
\nwill be applied only against future Royalties payable under this Section 4.1. If
\nany audit reveals an underpayment, then Barnes&Noble shall pay MICROSOFT the
\namount of the underpayment, together with interest as provided for in Section
\n4.5, within [***]<\/strong> days after the date of the auditor153s report.
\nFurther, if any audit reveals an underpayment of more than [***]
\n<\/strong>of the Royalties owed for the Royalty Period(s) subject to the audit,
\nthen Barnes&Noble shall reimburse MICROSOFT within [***]<\/strong>
\ndays, upon request, for all costs and expenses reasonably incurred by MICROSOFT
\nto conduct the audit.<\/p>\n<\/p>\n4.2 Method of Payment. Barnes&Noble shall make any and all payments to
\nMICROSOFT under this Agreement in currency of the United States of America
\nwithout any withholding, deduction, offset, setoff or other charge.
\nBarnes&Noble shall make such payments in immediately available funds by wire
\ntransfer to the account MICROSOFT specifies in its invoice to Barnes&Noble.
\nBarnes&Noble shall also send notification of such wire transfer to
\nspagpay@MICROSOFT.com and IPNotice@MICROSOFT.com.<\/p>\n<\/p>\n 7<\/p>\n \n
\n4.3 Taxes. Except as otherwise specified herein, amounts payable to MICROSOFT
\nunder this Agreement exclude any and all taxes (including sales, use, income and
\nvalue added taxes), duties, levies, fees, excises or tariffs
\n(“Taxes<\/strong>“) imposed on any activities of Barnes&Noble, its
\nAffiliates or Customers in connection with this Agreement.<\/p>\n<\/p>\n4.5 Delinquent Payment. Any fee, royalty or other amount not paid when due
\nand otherwise in accordance with this Section 4 shall bear interest at the rate
\nof [***]<\/strong> per month or the highest rate permitted by applicable
\nusury law, whichever is less, calculated on a daily basis and compounded on the
\nfirst day of each calendar month, from the date due until the date received by
\nMICROSOFT in accordance with Section 4.3. This Section 4.5 does not authorize
\nlate payments, and the payment of interest hereunder shall not be in lieu of or
\nprejudice any other right or remedy that MICROSOFT may have on account of
\nBarnes&Noble153s failure to make any payment in accordance with this Section
\n4.<\/p>\n<\/p>\n4.6 Royalty Arbitration. The Parties will use the Royalty Arbitration
\nProcesses in Exhibit C<\/strong> for escalation and resolution of issues
\nand disputes relating to payment under this Section 4 (including with respect to
\nDevice Fees, Covered Product units and allocation of products into Covered
\nProduct categories) that may arise during the performance of this Agreement
\n(“Royalty Disputes<\/strong>“).<\/p>\n<\/p>\n4.7 Royalty Payment Deferral.<\/p>\n<\/p>\n (a) If MICROSOFT fails to pay any undisputed payment when due under the
\nCommercial Agreement, then Barnes&Noble may withhold and defer payment of
\nany and all amounts otherwise due or becoming due to MICROSOFT under this
\nAgreement until such amount is paid in full to Barnes&Noble, and
\nBarnes&Noble will give MICROSOFT written notice of such deferral; provided
\nthat the amount subject to deferral shall not exceed the amount that MICROSOFT
\nhas failed to pay under the Commercial Agreement; and<\/p>\n<\/p>\n (b) If MICROSOFT or Barnes&Noble provides written notice of a dispute to
\nthe other Party regarding any payment obligation of MICROSOFT under the
\nCommercial Agreement, then, unless otherwise agreed by the parties:<\/p>\n<\/p>\n (i) those Parties will promptly submit the dispute to expedited arbitration
\nunder the Commercial Agreement;<\/p>\n<\/p>\n (ii) Barnes&Noble may withhold and defer payment of any and all amounts
\notherwise becoming due to MICROSOFT under this Agreement beginning after a
\ndetermination, by final order in such expedited arbitration or by agreement of
\nthe parties, that all or any portion of a disputed payment obligation is in fact
\ndue by MICROSOFT; provided that the amount subject to deferral shall not exceed
\nthe amount that MICROSOFT has failed to pay under the Commercial Agreement; and\n<\/p>\n<\/p>\n (iii) Barnes&Noble may continue to withhold and defer such payment until
\nsatisfaction in full of such payment obligation by MICROSOFT.<\/p>\n<\/p>\n 8<\/p>\n \n
\nSection 5. Term and Termination<\/em><\/strong><\/p>\n<\/p>\n5.1 General. The term of this Agreement (“Term<\/strong>“) shall
\ncommence as of the Effective Date and terminate upon the first of the following
\ndates to occur: (a) the fifth (5th) anniversary of the Start Date; (b) the date
\nBarnes&Noble provides MICROSOFT written notice of termination in accordance
\nwith Sections 3.4, 5.2 or 7.6 of this Agreement and such termination occurs; or
\n(c) the date MICROSOFT provides Barnes&Noble (or the Acquiring Third Party
\npursuant to Section 7.7) written notice of termination in accordance with
\nSections 5.2, 7.6 or 7.7 of this Agreement and such termination occurs.<\/p>\n<\/p>\n5.2 Early Termination.<\/p>\n<\/p>\n 5.2.1. Either Party may immediately terminate the Agreement by giving the
\nother Party written notice of termination in the event that:<\/p>\n<\/p>\n \n\n\n| \n (a)<\/p>\n<\/td>\n | \n the other Party commits any material breach of this Agreement and fails to
\ncure such breach within thirty (30) days after receipt of written notice of such
\nbreach;<\/p>\n<\/td>\n<\/tr>\n | \n| \n (b)<\/p>\n<\/td>\n | \n [***]<\/strong>;<\/p>\n<\/td>\n<\/tr>\n\n| \n (c)<\/p>\n<\/td>\n | \n [***]<\/strong>;<\/p>\n<\/td>\n<\/tr>\n\n| \n (d)<\/p>\n<\/td>\n | \n Dismissal pursuant to Section 3.6 is not granted; or<\/p>\n<\/td>\n<\/tr>\n | \n| \n (e)<\/p>\n<\/td>\n | \n the Commercial Agreement is terminated in accordance with its terms other
\nthan for Material Default by NewCo.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n 5.2.2. Termination by Barnes&Noble. Barnes&Noble may terminate this
\nAgreement by giving MICROSOFT written notice of termination in the event that
\nthe Investment Agreement is terminated in accordance with Section 5.01(b)(i) or
\n5.01(b)(ii) thereof and at the time of such termination MICROSOFT is in material
\nbreach of any of its representations, warranties, covenants or agreements
\ncontained in the Investment Agreement.<\/p>\n<\/p>\n 5.2.3. Termination by MICROSOFT. This Agreement shall automatically terminate
\nin the event that the Investment Agreement is terminated by MICROSOFT in
\naccordance with Section 5.01(b)(i)(A)(1) or Section 5.01(b)(i)(A)(2)(x).<\/p>\n<\/p>\n 5.3 Effect of Expiration or Termination. Sections 2, 3.1*, 3.2*, 3.5, 4*,
\n5.3, 6 and 7 of this Agreement shall survive the expiration or termination of
\nthis Agreement. Sections denoted with an asterisk (*) only survive with respect
\nto specific units of Covered Products distributed during the Term for which
\nDevice Fees were paid.<\/p>\n<\/p>\n Section 6. Representations, Warranties and
\nLiabilities<\/em><\/strong><\/p>\n<\/p>\n6.1 No Admission of Infringement or Liability. The terms (including Device
\nFees), provisions and payments set forth in this Agreement are not, and shall
\nnot be construed as, an admission by either Party of the infringement, validity
\nor enforceability of the Covered Patents or of any liability arising out of or
\nrelating to the Litigations or that the Device Fees set by this Agreement do or
\ndo not represent the royalty rates that would result from a Georgia-Pacific
\nanalysis. Additionally, the Parties agree that the Device Fees shall not be
\nrelied upon by either Party in any subsequent negotiations regarding a renewal
\nof this Agreement or for any purpose in any future litigation between the
\nParties other than for breach of payment obligations under this Agreement.<\/p>\n<\/p>\n 9<\/p>\n \n
\n6.2 No Breach of Other Agreement or Obligation. Each Party represents and
\nwarrants that the terms of this Agreement do not breach the terms of any other
\nagreement to which the Party is a party, and that the terms of this Agreement do
\nnot breach any obligations that the Party owes to any third party.<\/p>\n<\/p>\n 6.3 DISCLAIMER OF WARRANTIES<\/u>. MICROSOFT DISCLAIMS ANY AND ALL
\nREPRESENTATIONS AND WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY EXPRESS OR
\nIMPLIED WARRANTIES OF MERCHANTABILITY, NON-INFRINGEMENT OR SUITABILITY FOR ITS
\nINTENDED PURPOSE. FURTHER, MICROSOFT HAS NOT MADE, AND DOES NOT MAKE, ANY
\nREPRESENTATION OR WARRANTY: WITH REGARD TO THE SCOPE, COVERAGE, VALIDITY OR
\nENFORCEABILITY OF ANY OF THE COVERED PATENTS; THAT THE COVERED PATENTS APPLY
\nWORLDWIDE; OR THAT ANY COVERED PRODUCT MADE, USED, SOLD, OFFERED FOR SALE OR
\nIMPORTED UNDER THE LICENSE OR COVENANT IS OR WILL BE FREE FROM INFRINGEMENT OF
\nANY PATENT OR OTHER INTELLECTUAL PROPERTY RIGHT OF ANY THIRD PARTY.<\/p>\n<\/p>\n 6.4 Proper Authority. Each Party represents and warrants on behalf of itself
\nand its Affiliates that it has full right, power, and authority to (a) enter
\ninto this Agreement, and (b) bind its Affiliates to the terms of this Agreement.
\nEach Party also covenants that it will obtain, maintain and exercise all rights
\nnecessary to bind any Affiliate that becomes affiliated after the Effective Date
\nto all applicable terms of this Agreement. For purposes of this Agreement,
\nBarnes&Noble represents and warrants that barnesandnoble.com llc is as of
\nthe date hereof an Affiliate of Barnes&Noble.<\/p>\n<\/p>\n 6.5 Limitation of Liability. EXCEPT FOR ROYALTY PAYMENTS UNDER SECTION 4, IN
\nNO EVENT SHALL MICROSOFT OR BARNES&NOBLE, OR THEIR RESPECTIVE AFFILIATES, BE
\nLIABLE FOR ANY DAMAGES ARISING OUT OF OR RELATED TO THIS AGREEMENT IN EXCESS OF
\nANY PAYMENTS MADE BY BARNES&NOBLE TO MICROSOFT UNDER THIS AGREEMENT, AND NO
\nPARTY WILL HAVE ANY LIABILITY FOR ANY CONSEQUENTIAL DAMAGES, INCIDENTAL DAMAGES,
\nINDIRECT DAMAGES, SPECIAL DAMAGES OR LOST PROFITS ARISING OUT OF OR RELATING TO
\nTHIS AGREEMENT, EVEN IF ADVISED OF THE POSSIBILITY OF ANY SUCH DAMAGES. THESE
\nLIMITATIONS APPLY REGARDLESS OF WHETHER SUCH CLAIM IS BASED ON TORT, CONTRACT,
\nWARRANTY, STRICT LIABILITY OR ANY OTHER THEORY.<\/p>\n<\/p>\n Section 7. Miscellaneous<\/em><\/strong><\/p>\n<\/p>\n7.1 No Right to Technology. MICROSOFT shall not have any obligation under
\nthis Agreement to disclose or otherwise make available to Barnes&Noble or
\nits Affiliates any software, programs, specifications, designs, technical data,
\nknow how or other technology, whether or not the same may be required for the
\nexercise or commercial exploitation of any License, covenant or other rights
\nprovided herein.<\/p>\n<\/p>\n 7.2 Confidentiality. The Parties agree to the prompt publication of the joint
\npress release provided in Exhibit B hereof. The mere existence of this Agreement
\nand the identification of the Parties and the Covered Products are not
\nconfidential. However, the specific terms and conditions of this Agreement
\n(including the amount of any Royalties payable to MICROSOFT under this
\nAgreement) are confidential and shall not be disclosed by either Party except:
\n(a) as may be required by applicable law; (b) as may be required by judicial or
\ngovernmental order or rule (provided that for both (a) & (b), the disclosing
\nParty either gives the other Party reasonable notice to enable it to seek a
\nprotective order or uses reasonable measures to seek an appropriate protective
\norder itself); (c) in confidence to a Party153s accountants, tax advisors,
\nauditors and\/or attorneys for purposes of seeking professional services; and (d)
\nby written consent of the other Party and only under terms of confidentiality.\n<\/p>\n<\/p>\n 10<\/p>\n \n
\n7.3 Entire Agreement, Modifications and Waiver. This Agreement, together with
\nthe Commercial Agreement and Investment Agreement, constitutes the entire
\nagreement between the Parties with respect to its subject matter and supersedes
\nall prior and contemporaneous agreements, whether written or oral. This
\nAgreement shall not be modified except by a written agreement signed by an
\nauthorized representative of the Party against whom such modification is sought
\nto be enforced. Failure by either Party to enforce any provision of this
\nAgreement shall not be deemed a waiver of future enforcement of that provision.\n<\/p>\n<\/p>\n 7.4 Notices. Except as otherwise specified in Sections 4.1.2 and 4.2 or
\notherwise agreed in writing by the Parties, any notices given under this
\nAgreement shall be delivered either by messenger or overnight delivery service,
\nor sent by facsimile with a confirmation sent via certified or registered mail,
\npostage prepaid and return receipt requested, and shall be deemed to have been
\ngiven on the day when received by the Party to whom the notice is given.<\/p>\n<\/p>\n Any notices to Barnes&Noble shall be addressed to:<\/p>\n<\/p>\n Barnes & Noble, Inc.<\/p>\n<\/p>\n Attn: General Counsel<\/p>\n<\/p>\n 122 Fifth Avenue<\/p>\n<\/p>\n New York, NY 10011<\/p>\n<\/p>\n Facsimile No.: 212-463-5683<\/p>\n<\/p>\n<\/p>\n Any notices to MICROSOFT shall be addressed to:<\/p>\n<\/p>\n Microsoft Licensing GP<\/p>\n<\/p>\n Attn: Special Agreements<\/p>\n<\/p>\n Dept. 551, Volume Licensing<\/p>\n<\/p>\n 6100 Neil Road, Suite 210<\/p>\n<\/p>\n Reno, Nevada 89511<\/p>\n<\/p>\n Facsimile No.: 775-823-5600<\/p>\n<\/p>\n<\/p>\n With a copy to:<\/p>\n<\/p>\n Microsoft Corporation<\/p>\n<\/p>\n Attn: Corporate Vice President, Intellectual Property & Licensing Group\n<\/p>\n<\/p>\n Legal and Corporate Affairs<\/p>\n<\/p>\n One Microsoft Way<\/p>\n<\/p>\n Redmond, WA 98052-6399<\/p>\n<\/p>\n Facsimile No.: 425-936-7329 (Attn: IPLG)<\/p>\n<\/p>\n 11<\/p>\n \n
\n<\/p>\n7.5 Jurisdiction and Governing Law. This Agreement and all disputes arising
\nout of or related to this Agreement shall be governed by the laws of the State
\nof New York, without reference to conflict of laws principles. Except as set
\nforth in Section 4.6, any and all claims, lawsuits or disputes of any kind
\nbetween the Parties arising out of or relating to this Agreement shall be
\nresolved in federal or state courts in the State of New York within the Southern
\nDistrict of New York. The Parties hereby waive any challenge to the jurisdiction
\nor venue of such courts over such claims, lawsuits or disputes.<\/p>\n<\/p>\n 7.6 Assignment. MICROSOFT shall not assign, sell or otherwise transfer any of
\nits Covered Patents which are (at the time of the assignment, sale or other
\ntransfer) subject to the rights of Barnes&Noble and its Affiliates under
\nthis Agreement, unless such assignment, sale or other transfer is made subject
\nto, and the transferee is bound by, the release, License, and Covenant set forth
\nin Sections 2.1, 3.1 and 3.2 with respect to such Covered Patents. Except as
\nexpressly provided in this Section 7.6, the Parties may not transfer or assign
\nthe License, Covenant, this Agreement or any rights or obligations hereunder to
\nany third party, whether by Acquisition, operation of contract, law or otherwise
\n(including in connection with insolvency or bankruptcy), except with the express
\nprior written consent of the other Party. MICROSOFT may assign this entire
\nAgreement (including the release, License, Covenant and all rights and
\nobligations hereunder) in the case of a merger or sale of all or substantially
\nall of the assets or stock of MICROSOFT. Subject to the terms and conditions of
\nSection 7.7, Barnes&Noble may assign this entire Agreement (including the
\nrelease, License, Covenant and all rights and obligations hereunder including
\nSection 3.4) to an Acquiring Third Party that is Acquiring Barnes&Noble;
\nprovided that with respect to all Covered Products sold by, for or on behalf of
\nBarnes&Noble or its Affiliates prior to the date of such assignment,
\nBarnes&Noble and its Affiliates shall also retain the release, License and
\nCovenant set forth in Sections 2.1, 3.1 and 3.2 with respect to Covered Patents
\nalong with all other associated rights including under Sections 3.4 and 5.2.
\nSubject to the terms and conditions of Section 7.7, Barnes&Noble shall
\nassign (and shall cause assumption of) this entire Agreement (including the
\nrelease, License, Covenant and all rights and obligations hereunder including
\nSection 3.4) to an Acquiring Third Party that is Acquiring the Consumer Device
\nBusiness, if that Acquiring Third Party is not Acquiring Barnes&Noble as
\npart of that Acquisition, upon which assignment the Acquiring Third Party shall
\nbe substituted for Barnes&Noble under all provisions of this Agreement with
\neffect from and after the date of such assignment and in connection with such
\nassignment. Barnes&Noble shall also assign (and shall cause assumption of)
\nthis entire Agreement (including the release, License, Covenant and all its
\nrights and obligations hereunder including Section 3.4) to NewCo in conjunction
\nwith and effective upon Separation, upon which assignment NewCo shall be
\nsubstituted for Barnes&Noble under all provisions of this Agreement with
\neffect from and after the date of such assignment and in connection with such
\nassignment; provided that such assignment shall not reduce or impair the
\nprotections afforded to Barnes&Noble under this Agreement with respect to
\nconduct prior to the date of such assignment. Any attempted transfer or
\nassignment in violation of this section shall be void; and, in the event of any
\nsuch assignment or attempted assignment by a Party, the other Party shall have
\nthe right to immediately terminate this Agreement by giving written notice to
\nsuch Party.<\/p>\n<\/p>\n 12<\/p>\n \n
\n7.7 Change of Control.<\/strong><\/p>\n<\/p>\n(a) If Barnes&Noble or its Consumer Device Business (“Acquired
\nEntity<\/strong>“) is Acquired directly or indirectly by a third party
\n(“Acquiring Third Party<\/strong>“), then each of the following
\nsubsections shall apply.<\/p>\n<\/p>\n(i) Barnes&Noble shall promptly give notice of such Acquisition to
\nMICROSOFT.<\/p>\n<\/p>\n (ii) Such Acquisition shall not affect any releases, warranties,
\nrepresentations or other rights granted by Barnes&Noble or its Affiliates to
\nMICROSOFT, its Affiliates or their customers.<\/p>\n<\/p>\n (iii) The releases granted to Barnes&Noble and its Affiliates in Section
\n2 shall survive as to Covered Products of the Acquired Entity and its
\nThen-Existing Affiliates, but no releases, licenses or covenants shall extend to
\nany software, products or services of the Acquiring Third Party or any of its
\nAffiliates.<\/p>\n<\/p>\n (iv) Section 5.2.1(c) shall be automatically deleted from this Agreement and
\nshall no longer apply.<\/p>\n<\/p>\n (v) [***]<\/strong><\/p>\n<\/p>\n(vi) MICROSOFT shall have the right to terminate this Agreement at any point
\nafter the Acquisition (or any subsequent Acquisition) by providing written
\nnotice of termination to the Acquiring Third Party with such termination being
\neffective one hundred eighty (180) days after receipt by Barnes&Noble of
\nsuch notice.<\/p>\n<\/p>\n (b) An “Acquisition”<\/strong> means any transaction or series of
\nrelated transactions involving Barnes&Noble or the Consumer Device Business
\nresulting in (i) a person or entity acquiring, directly or indirectly,
\nbeneficial ownership of securities thereof having more than 50% of the total
\nvoting power for the election of directors or other managing authority of
\nBarnes&Noble or the Consumer Device Business, respectively, after such
\ntransaction(s), (ii) a liquidation or reorganization of Barnes&Noble or the
\nConsumer Device Business, or (iii) an entity or entities or person or persons
\nwhich did not direct the management and operations of Barnes&Noble or the
\nConsumer Device Business before such transaction(s) otherwise acquiring the
\nright to direct the management and operations of Barnes&Noble or the
\nConsumer Device Business, respectively, after such transaction(s). If
\nBarnes&Noble or the Consumer Device Business is the subject of any of the
\nforegoing transactions, then it is deemed “Acquired”<\/strong>.
\n“Then-Existing Affiliates<\/strong>” means Affiliates of Barnes&Noble
\nbefore such Acquisition.<\/p>\n<\/p>\n7.8 No Third Party Beneficiaries. This Agreement is for the benefit of the
\nParties, their Affiliates and Covenanted Suppliers only, and shall be
\nenforceable by the Parties, their Affiliates and Covenanted Suppliers only;
\nprovided, however, no action may be commenced or prosecuted against a Party by
\nany third party claiming as a third-party beneficiary of this Agreement or the
\nLicense or covenants provided herein, except that a Covenanted Supplier may rely
\nupon this Agreement solely in defending actions commenced against them by a
\nParty or its Affiliates.<\/p>\n<\/p>\n 7.9 Construction. As used in this Agreement, (i) the words “include” and
\n“including” and variations thereof, will not be deemed to be terms of
\nlimitation, but rather will be deemed to be followed by the words “without
\nlimitation,” (ii) unless the context otherwise requires, the word “or” shall be
\ndeemed to be an inclusive “or” and shall have the meaning equivalent to
\n“and\/or”, and (iii) “past” shall mean any time before the Effective Date,
\n“current” shall mean as of the Effective Date, and “future” shall mean any time
\nafter the Effective Date.<\/p>\n<\/p>\n 13<\/p>\n \n
\n7.10 Counterparts and Facsimile. This Agreement may be executed on facsimile
\ncopies or in counterparts, each counterpart of which shall be deemed an original
\nand all of which together shall constitute one and the same Agreement.
\nNotwithstanding the foregoing, if requested by a Party, the other Party shall
\ndeliver original executed copies of this Agreement to such requesting Party as
\nsoon as practicable following execution thereof.<\/p>\n<\/p>\n 7.11 Successors and Assigns. This Agreement shall be binding upon and shall
\ninure to the benefit of a Party153s successors and permitted assigns.<\/p>\n<\/p>\n 14<\/p>\n \n
\nIN WITNESS WHEREOF, the Parties have caused this Agreement to be made and
\nexecuted by duly authorized officers.<\/p>\n<\/p>\n<\/p>\n \n\n\n| \n Microsoft Corporation<\/p>\n<\/td>\n<\/tr>\n | \n| \n By:<\/p>\n<\/td>\n | \n \/s\/ Steven A. Ballmer<\/p>\n<\/td>\n<\/tr>\n | \n| \n Name:<\/p>\n<\/td>\n | \n Steven A. Ballmer<\/p>\n<\/td>\n<\/tr>\n | \n| \n Title:<\/p>\n<\/td>\n | \n Chief Executive Officer<\/p>\n<\/td>\n<\/tr>\n | \n| \n Date Signed:<\/p>\n<\/td>\n | \n 4\/27\/2012<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n [Signature Page to the Patent License Agreement<\/em>]<\/p>\n\n
\n\n \n\n\n| \n Microsoft Licensing GP<\/p>\n<\/td>\n<\/tr>\n | \n| \n By:<\/p>\n<\/td>\n | \n \/s\/ Hugh Aitken<\/p>\n<\/td>\n<\/tr>\n | \n| \n Name:<\/p>\n<\/td>\n | \n Hugh Aitken<\/p>\n<\/td>\n<\/tr>\n | \n| \n Title:<\/p>\n<\/td>\n | \n General Manager<\/p>\n<\/td>\n<\/tr>\n | \n| \n Date Signed:<\/p>\n<\/td>\n | \n 4\/27\/2012<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n \n [Signature Page to the Patent License Agreement<\/em>]<\/p>\n\n
\n<\/p>\n\n\n\n| \n barnesandnoble.com llc<\/p>\n<\/td>\n<\/tr>\n | \n| \n By:<\/p>\n<\/td>\n | \n \/s\/ Eugene V. DeFelice<\/p>\n<\/td>\n<\/tr>\n | \n| \n Name:<\/p>\n<\/td>\n | \n Eugene V. DeFelice<\/p>\n<\/td>\n<\/tr>\n | \n| \n Title:<\/p>\n<\/td>\n | \n Vice President, General Counsel & Secretary<\/p>\n<\/td>\n<\/tr>\n | \n| \n Date Signed:<\/p>\n<\/td>\n | \n 4\/27\/2012<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n [Signature Page to the Patent License Agreement<\/em>]<\/p>\n\n
\n<\/p>\n\n\n\n| \n Barnes & Noble, Inc.<\/p>\n<\/td>\n<\/tr>\n | \n| \n By:<\/p>\n<\/td>\n | \n \/s\/ Eugene V. DeFelice<\/p>\n<\/td>\n<\/tr>\n | \n| \n Name:<\/p>\n<\/td>\n | \n Eugene V. DeFelice<\/p>\n<\/td>\n<\/tr>\n | \n| \n Title:<\/p>\n<\/td>\n | \n Vice President, General Counsel & Secretary<\/p>\n<\/td>\n<\/tr>\n | \n| \n Date Signed:<\/p>\n<\/td>\n | \n 4\/27\/2012<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n [Signature Page to the Patent License Agreement<\/em>]<\/p>\n\n
\n<\/p>\nCONFIDENTIAL SETTLEMENT AND PATENT LICENSE AGREEMENT<\/p>\n \n EXHIBIT A<\/p>\n \n<\/p>\n ROYALTY REPORT<\/p>\n \n
\n<\/p>\nMicrosoft Licensing GP : IP&L Report<\/p>\n<\/p>\n
\nLicensee: Barnes & Noble, Inc.<\/p>\n<\/p>\n Agreement Number: ________________________________________<\/p>\n<\/p>\n Report for the Royalty Period Beginning\/Ending:
\n_________________________________________<\/p>\n<\/p>\n Send completed form to ipnotice@microsoft.com<\/u><\/p>\n<\/p>\n<\/p>\n\n\n\n| \n Covered <\/strong><\/p>\nProducts<\/strong><\/p>\n<\/td>\n| \n Category of<\/strong><\/p>\nCovered<\/strong><\/p>\nProducts<\/strong><\/p>\n<\/td>\n| \n Royalty-<\/strong><\/p>\nBearing Units<\/strong><\/p>\nSold this <\/strong><\/p>\nRoyalty Period<\/strong><\/p>\n<\/td>\n| \n Transfer <\/strong><\/p>\nPrice<\/strong><\/p>\n<\/td>\n| \n Device Fee<\/strong><\/p>\n<\/td>\n| \n Royalties<\/strong><\/p>\n(Units x Device Fee)<\/strong><\/p>\n<\/td>\n<\/tr>\n\n| <\/td>\n | <\/td>\n | <\/td>\n | <\/td>\n | <\/td>\n | <\/td>\n<\/tr>\n | \n| \n | | | | | | | | | | | | | | | | |