What does the license mean on microsoft office?

I have a copy of microsoft office. on the box it says it is permissable to load it onto three computers. Do they all have to be in the same house or can my friend load it on to his computer?

What does the license mean on microsoft office?
Three licenses (seats) will be count on three computers and register to Microsoft Office website. You can give a seat to your friend's computer which means you still have two seats for your self.

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