Microsoft Corp. (NASDAQ: MSFT) announced a new agreement with OpenAI that values Microsoft's investment in the artificial intelligence company at approximately $135 billion, representing about 27% ownership on an as-converted diluted basis.

The agreement supports OpenAI's transition to a public benefit corporation structure and recapitalization. Microsoft previously held a 32.5% stake in OpenAI's for-profit entity before recent funding rounds, according to the company's statement.

Under the revised terms, Microsoft retains exclusive intellectual property rights and Azure API exclusivity until OpenAI achieves artificial general intelligence (AGI). The declaration of AGI will now require verification by an independent expert panel.

Microsoft's IP rights for models and products extend through 2032 and include post-AGI models. The company's research IP rights continue until AGI verification or through 2030, whichever occurs first. Microsoft can now independently pursue AGI development alone or with third parties.

OpenAI gains new flexibility under the agreement, including the ability to jointly develop products with third parties and provide API access to U.S. government national security customers regardless of cloud provider. The company can also release open weight models meeting specific capability criteria.

OpenAI committed to purchase an additional $250 billion of Azure services, while Microsoft no longer holds right of first refusal as OpenAI's compute provider. The existing revenue share agreement continues until AGI verification, with payments extended over a longer timeframe.

The partnership began in 2019 with Microsoft's initial investment in what was then a research organization. Both companies stated the new agreement positions them to continue product development while enabling independent innovation and growth.