The point of a deal like that is to reassure Mozilla that Yahoo is not going to sell, at least not during the term of the agreement. It provides the party on the other end with a sort of insurance policy -- "we can show you how serious we are about not doing this thing you're afraid of by requiring ourselves to feel some serious pain if we ever actually do it."

This insurance policy is both literal -- if Yahoo does sell, whatever hardship that causes Mozilla will be eased considerably by all that cash -- and figurative -- Yahoo's willingness to offer such a payout should a sale happen signals to Mozilla that Yahoo's leadership is probably not actively pursuing a sale. (Or at least wasn't, at the time the deal was made.) The theory on the latter part being that no rational person would make that offer if they thought a sale was in any way likely.

Meh. I would expect that if Mozilla did not put in reasonable effort at "making things work" with the new owners the new owners would sue. Not sure on what grounds... but with a billion on the line spending a few tens of millions fighting a longshot is likely worth it.

The buyer will surely negotiate with Mozilla before they buy Yahoo and get a commitment from them (which might be worth extra $). That, or they will see it as sunk cost.

But Mozilla might have a bit of PR challenge on its hands if they walked away... :-)

It means having to court a new search engine provider for a revenue stream after those three years are up. Such a deal may not be as favorable for them as an agreement to stick around partnered with yahoo.

The buyer gives them more money.

"Here's a payment and an increase in share worth $1.3B. If that's not acceptable, we'll publicly announce this afternoon that we're not renewing our deal."

Excellent question.

If they buyer is interested in maintaining a search presence, they'll almost have to negotiate an extension right away?