NOOK Media Announces the Completion of Strategic Investment by Pearson

  NOOK Media Announces the Completion of Strategic Investment by Pearson

Business Wire

NEW YORK & LONDON -- January 23, 2013

NOOK Media, LLC, a subsidiary of Barnes & Noble, Inc. (NYSE: BKS), the leading
retailer of content, digital media and educational products, today announced
the completion of their previously announced investment by Pearson (NYSE:PSO),
the world’s leading learning company. Pearson made its approximately $89.5
million in cash investment in NOOK Media, LLC at a post-money valuation of
approximately $1.789 billion in exchange for preferred membership interests
representing a 5% equity stake. Following the closing of the transaction,
Barnes & Noble now owns approximately 78.2% of the NOOK Media subsidiary and
Microsoft, which also holds preferred membership interests, owns approximately
16.8%. Subject to certain conditions, Pearson will earn the option to purchase
up to an additional five percent ownership in NOOK Media.

Pearson’s strategic investment in NOOK Media will accelerate customer access
to digital content by pairing its leading expertise in online learning with
NOOK Media’s expertise in reading technology, online commerce and customer
service. This will facilitate improved discovery of available digital content
and services, as well as seamless access.

“We look forward to working with Pearson, a valued partner of ours for many
years, in developing new ways to improve and enhance digital learning for
students,” said William Lynch, Chief Executive Officer of Barnes & Noble, Inc.

About Barnes & Noble, Inc.

Barnes & Noble, Inc. (NYSE:BKS) is a Fortune 500 company and the leading
retailer of content, digital media and educational products. The company
operates 689 Barnes & Noble bookstores in 50 states, and one of the Web’s
largest e-commerce sites, BN.com (www.bn.com). Its NOOK Media LLC subsidiary
is a leader in the emerging digital reading and digital education markets. The
NOOK digital business offers award-winning NOOK® products and an expansive
collection of digital reading and entertainment content through the NOOK
Store™ (www.nook.com), while Barnes & Noble College Booksellers, LLC operates
674 bookstores serving over 4.6 million students and faculty members at
colleges and universities across the United States. Barnes & Noble is proud to
be named a J.D. Power and Associates 2012 Customer Service Champion and is
only one of 50 U.S. companies so named. Barnes & Noble.com is ranked the
number one online retailer in customer satisfaction in the book, music and
video category and a Top 10 online retailer overall in customer satisfaction
according to ForeSee E-Retail Satisfaction Index (Spring Top 100 Edition).

General information on Barnes & Noble, Inc. can be obtained via the Internet
by visiting the company's corporate website: www.barnesandnobleinc.com.

About NOOK Media LLC

NOOK reading and entertainment products make it easy to read what you love,
anywhere you like^™ with a fun, easy-to-use and immersive digital reading
experience. With NOOK, customers gain access to the expansive NOOK Store^™ of
more than 3 million digital books, plus periodicals, comics, apps, movies and
TV shows, and the ability to enjoy content across a wide array of popular
devices through free NOOK Reading Apps^™ and NOOK Video apps, available at
www.nook.com/freenookapps. NOOK owners receive Always Free NOOK Support in any
of Barnes & Noble’s nearly 700 bookstores. Find NOOK devices in Barnes & Noble
stores and online at www.nook.com, as well as leading retailers including Best
Buy, Walmart, Target and many others. NOOK products are available in the
United Kingdom throughwww.nook.co.ukandleading retailers.

For more information on NOOK, follow us on www.twitter.com/nookBN or
www.twitter.com/nook_UK and www.facebook.com/nook.

About Pearson

Pearson, the world’s leading learning company, has global reach and
market-leading businesses in education, business information and consumer
publishing (NYSE: PSO).

Forward-Looking Statements

This press release contains certain forward-looking statements (within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended) and information
relating to Barnes & Noble that are based on the beliefs of the management of
Barnes & Noble as well as assumptions made by and information currently
available to the management of Barnes & Noble. When used in this
communication, the words "anticipate," "believe," "estimate," "expect,"
"intend," "plan," "will" and similar expressions, as they relate to Barnes &
Noble or the management of Barnes & Noble, identify forward-looking
statements.

Such statements reflect the current views of Barnes & Noble with respect to
future events, the outcome of which is subject to certain risks, including,
among others, the general economic environment and consumer spending patterns,
decreased consumer demand for Barnes & Noble's products, low growth or
declining sales and net income due to various factors, risk that international
expansion will not be successfully achieved or may be achieved later than
expected, possible disruptions in Barnes & Noble's computer systems, telephone
systems or supply chain, possible risks associated with data privacy,
information security and intellectual property, possible work stoppages or
increases in labor costs, possible increases in shipping rates or
interruptions in shipping service, effects of competition, possible risks that
inventory in channels of distribution may be larger than able to be sold,
possible risk that returns from consumers or channels of distribution may be
greater than estimated, the risk that the expected sales lift from Borders’
store closures is not achieved in whole or part, the risk that digital sales
growth is less than expectations and the risk that it does not exceed the rate
of investment spend, higher-than-anticipated store closing or relocation
costs, higher interest rates, the performance of Barnes & Noble's online,
digital and other initiatives, the performance and successful integration of
acquired businesses, the success of Barnes & Noble's strategic investments,
unanticipated increases in merchandise, component or occupancy costs,
unanticipated adverse litigation results or effects, product and component
shortages, the potential adverse impact on the business resulting from the
review of a potential separation of the NOOK digital business, the risk that
the transactions contemplated with Pearson are not able to be implemented on
the terms contemplated or at all, the risk that the transactions do not
achieve the expected benefits for the parties including the risk that NOOK
Media’s applications are not commercially successful or that the expected
distribution of those applications is not achieved, the risk that any
subsequent spin-off, split-off or other disposition by Barnes & Noble of its
interest in NOOK Media results in adverse impacts on Company or NOOK Media
(including as a result of termination of agreements and other adverse
impacts), the potential impact on Barnes & Noble’s retail business of the
separation, the potential tax consequences for Barnes & Noble and its
shareholders of a subsequent spin-off, split-off or other disposition by
Barnes & Noble of its interest in NOOK Media, the risk that the international
expansion contemplated by the relationship is not successful, the risk that
NOOK Media is not able to perform its obligations under the commercial
agreement, the risk that Barnes & Noble may not recoup its investments in the
NOOK digital business as part of any separation transaction, the risks,
difficulties, and uncertainties that may result from the separation of
businesses that were previously co-mingled including necessary ongoing
relationships, and potential for adverse customer impacts and other factors
which may be outside of Barnes & Noble’s control, including those factors
discussed in detail in Item 1A, "Risk Factors," in Barnes & Noble's Annual
Report on Form 10-K and Form 10-K/A, and in Barnes & Noble's other filings
made hereafter from time to time with the SEC. Our forward looking statements
relating to international expansion are also subject to the following risks,
among others that may affect the introduction, success and timing of the NOOK
e-reader and content in countries outside the United States: we may not be
successful in reaching agreements with international companies, the terms of
agreements that we reach may not be advantageous to us, our NOOK device may
require technological changes to comply with applicable laws, and marketplace
acceptance and other companies have already entered the marketplace with
products that have achieved some customer acceptance.

Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results or outcomes may vary
materially from those described as anticipated, believed, estimated, expected,
intended or planned. Subsequent written and oral forward-looking statements
attributable to Barnes & Noble or persons acting on its behalf are expressly
qualified in their entirety by the cautionary statements in this paragraph.
Barnes & Noble undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise after the date of this communication.

Contact:

Media:
Barnes & Noble, Inc.
Mary Ellen Keating, 212-633-3323
Senior Vice President,
Corporate Communications
MKeating@bn.com
or
Pearson
Susan Aspey, 800-745-8489
Vice President, Media Relations
susan.aspey@pearson.com
or
Investors:
Barnes & Noble, Inc.
Andy Milevoj, 212-633-3489
Vice President, Investor Relations
amilevoj@bn.com
 
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