Free Licensing Agreement

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Licensing Agreement

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In which state is the intellectual property going to be used?Which state should I choose?You should choose the state where the recipient of the license (the "licensee") lives or conducts business.

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Virginia

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Licensing Agreement

THIS LICENSING AGREEMENT (the "Agreement") dated this _____ day of _____________, 20____

BETWEEN:

____________________ of ________________________________________________________________________________
(the "Licensor")

OF THE FIRST PART

- AND -

____________________ of ________________________________________________________________________________
(the "Licensee")

OF THE SECOND PART

(individually the "Party" and collectively the "Parties")

IN CONSIDERATION OF the Licensee paying the License Fee to the Licensor, the receipt and sufficiency of which consideration is hereby acknowledged, the Licensor grants the License to the Licensee on the following terms:

Licensed Intellectual Property
The Licensor owns and is granting to the Licensee the right to use the following licensed intellectual property (the "Intellectual Property"): _____________________________________________________________
_____________________________________________________________
_____________________________________________________________.
Grant of License
The Licensor grants to the Licensee an exclusive license to use the Intellectual Property (the "License"), from ________________, 20____ to ________________, 20____ (such period, the "Term").
Permitted Use
The Licensee is permitted to use the Intellectual Property in any way that does not violate the terms of this Agreement. This use does not include the right to sell or distribute the Intellectual Property.
The Licensee may only modify the Intellectual Property with the prior, written consent of the Licensor.
License Fee
The Licensee will pay the Licensor a license fee (the "License Fee") composed of:
Payment Details
The License Fee will be paid by cash.
Assignment
The Licensee shall not allow others to use the Intellectual Property and shall not use the Intellectual Property in a way that allows others to use the Intellectual Property except in accordance with this Agreement.
The Licensee may not assign or transfer the Agreement or any rights granted within without the prior written consent of the Licensor, and any attempted assignment or delegation without such consent will be void.
Sublicensing
The Licensee may not sublicense the Intellectual Property or any rights granted in this Agreement without the prior written consent of the Licensor, and any attempted sublicense without such consent will be void.
Warranties
The Intellectual Property is provided "as is" to the Licensee. The Licensor, and its officers, employees, agents and suppliers, do not provide any warranty, whether express or implied, as to the Intellectual Property.
Liability & Indemnity
The Licensor will not be liable for any third party claims, losses, damages, liabilities, penalties, punitive damages, expenses, legal fees or costs of any kind or amount whatsoever resulting from the Licensee’s use of the Intellectual Property.
The Licensee agrees to defend, indemnify and hold harmless the Licensor and its officers, employees, agents and suppliers against any and all claims, losses, damages, liabilities, penalties, punitive damages, expenses, reasonable legal fees and costs of any kind or amount whatsoever resulting from or arising out of the use of the Intellectual Property by the Licensee, or its officers, employees, agents or suppliers, or the Licensee's breach of this Agreement.
Termination
This Licensor shall have the option to terminate the Agreement immediately upon the failure of the Licensee to comply with the terms and conditions herein.
The Licensor reserves the right to cancel this Agreement immediately:
1. if the Licensee fails to make a payment when due; or
2. in the event of the Licensee's insolvency or bankruptcy.
The Licensor reserves the right to discontinue the License and terminate the Agreement immediately, as well as to commence legal proceedings, if any copyright infringement has taken place due to the Licensee’s unauthorized use of the Intellectual Property.
Upon expiry or termination of this Agreement, the Licensee shall immediately discontinue the use of the Intellectual Property and, where applicable, shall return or destroy all copies and archives of the Intellectual Property, as per the instructions of the Licensor.
Default
Notwithstanding anything to the contrary in this Agreement, if the Licensee defaults in the performance of any obligation under this Agreement, then the Licensor may declare the entire amount owing under this Agreement calculated at the time of default to be immediately due and payable.
Intellectual Property Rights
The Licensor retains ownership of the Intellectual Property.
The Licensee will be the owner of any derivative works created by the Licensee using the Intellectual Property during the Term of this Agreement.
The Intellectual Property shall not be copied, published, or used in any way except as provided for in this Agreement.
The Licensee shall not falsely represent that they are the original creator of the Intellectual Property.
Confidentiality
Any Confidential Information exchanged between the Parties will not be shared or disclosed to any person except with prior, written consent of the other Party, or as required by law. The obligations of confidentiality will apply during the Term and will survive indefinitely upon termination of this Agreement.
Confidential information refers to any data or information relating to the Party, whether business or personal, which would reasonably be considered to be private or proprietary to the Party and that is not generally known and where the release of that confidential information could reasonably be expected to cause harm to the Party, and includes trade secrets, moral rights, goodwill, copyrights, patents, trademarks, know-how, research, drawings, plans, designs, standards, specifications, and methods (“Confidential Information”).
Confidential Information does not include: information that is available to the public other than through the Licensee’s actions or inactions; information that is rightfully received from a third party, legally in possession of it; and information that is independently developed by the Licensee without the use of the Confidential Information.
General Provisions
If there is a conflict between any provision of this Agreement and the applicable legislation of the United States (the "Act"), the Act will prevail and such provision of the Agreement will be amended or deleted as necessary in order to comply with the Act. Further, any provisions that are required by the Act are incorporated into this Agreement.
If any terms or provisions of this Agreement are determined to be invalid or unenforceable by a court of competent jurisdiction, the remainder of this Agreement will not be affected and each unaffected term and provision will remain in full force and effect.
This Agreement will be governed by and construed in accordance with the laws of the United States, without regard to the jurisdiction in which any action may be instituted. The Licensee agrees to submit to the jurisdiction of the courts of Virginia to bring any action or for the enforcement of this Agreement. Notwithstanding, the Licensor reserves the right to commence legal action to obtain injunctive relief in any court of competent jurisdiction.
The Agreement will inure to the benefit and be binding upon the Licensor and the Licensee and their respective successors and assigns.
This Agreement constitutes the entire agreement between the Licensor and the Licensee with respect to the subject matter hereof and there are no further items or provisions, either oral or otherwise.
The provisions contained in this Agreement cannot be changed except by the signed and delivered written consent of both Parties.
Headings are inserted for convenience only and are not to be considered when interpreting this Agreement. Words in the singular mean and include the plural and vice versa. Words in the masculine mean and include the feminine and vice versa.
This Agreement may be executed in counterparts. Facsimile signatures are binding and are considered to be original signatures.
All monetary amounts in this Agreement refer to the United States dollar (USD), and all payments required to be paid under this Agreement will be paid in USD unless the Parties agree otherwise in writing.
Time is of the essence in this Agreement.

The Parties have executed this Licensing Agreement on this _____ day of _____________, 20____.

	_____________________________ ____________________ (Licensor)

	_____________________________ ____________________ (Licensee)

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Last updated December 26, 2024

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What is a Licensing Agreement?

A Licensing Agreement is a document artists, creators, and businesses use to allow another party to use their intellectual property (IP) in exchange for compensation. With this contract, you give the other party permission to use your property while retaining your ownership rights.

This contract outlines the terms and conditions of the deal, including how the non-owning party can sell, distribute, or use the intellectual property.

Parties to a Licensing Agreement

The two parties in a Licensing Agreement are the licensor and the licensee.

Party

Definition

Licensor

The licensor is the individual or entity that owns the rights to something and grants permission to another party to use that property under certain terms and conditions outlined in the Licensing Agreement.

Popular entertainment companies, like Disney or Warner Brothers, are real-world examples of licensors. In both cases, these companies own intellectual property or franchises that other companies can use for a fee.

Licensee

The individual or entity that receives permission to use something under the terms specified in the Licensing Agreement.

Usually, the licensee pays royalties or fees to the licensor to use the intellectual property.

If Disney is the licensor, examples of licensees could be LEGO, Hasbro, or Mattel. These companies may have Licensing Agreements in order to create and sell products using Disney characters or franchises.

Key terms to create a Licensing Agreement

In order to effectively create a Licensing Agreement, here are some key terms to keep in mind:

1. Intellectual property

Intellectual property refers to creations of the mind which are legally recognized and protected. Examples of intellectual property can include inventions, literary and artistic works, designs, symbols, names, and images. Typically, intellectual property is protected by trademarks, patents, and copyrights.

Intellectual property is distinct from physical property. The ideas and designs that help create a physical item, not the item itself, are intellectual property. For example, a car is physical property. On the other hand, the car’s designs, technological components, or model name are all intellectual property. However, IP rights can sometimes extend to physical objects, specifically the reproduction and distribution of tangible copies of the work.

For your Licensing Agreement, be sure to state if the intellectual property is licensed as a trademark with the US Patent or Trademark Office or with a state trademark office.

2. Derivative works

A derivative work is a new creation or product based on the existing intellectual property. For example, a movie adaptation of a popular book is considered a derivative work because it takes the original IP and adapts it to a new format.

When creating your Licensing Agreement, determine if the licensor or the licensee will be the sole owner of derivative works.

If the licensor owns any derivative works the licensee creates, the licensee can still use their derivative works for the duration of the contract.

3. License-back

Your Licensing Agreement should include information about a license-back. Granting a license-back means the original owner/licensor can keep using their intellectual property, even after giving an exclusive license to the licensee.

If you choose to include a license-back, our document will include a clause that the licensor has paid the licensee $1.00 for this right.

4. Assignment of license

When creating your Licensing Agreement, make sure to determine if the licensee will be allowed to assign the licensed product to a third party. If so, the third party can use the licensed product in the same way as the original licensee.

Types of Licensing Agreements

There are two types of Licensing Agreements: exclusive and non-exclusive.

Exclusive use grants the licensee the sole right to use the intellectual property. Under an exclusive use agreement, no other person can use the intellectual property. However, as outlined, if your exclusive Licensing Agreement includes a license-back clause, the original owner can keep using their intellectual property.
Non-exclusive use allows multiple licensees to use the same intellectual property. In other words, the licensor can enter into several Licensing Agreements for the same idea or product.

What are the benefits of Licensing Agreements?

1. Helps to avoid disputes

Licensing Agreements can help avoid future conflicts by clearly outlining how the IP can be used. With all the finer details, such as allowed uses, payment terms, and contract duration, in writing, both parties will have a physical document to consult in case of confusion or disagreement.

Additionally, these agreements often provide methods for resolving disputes. Our questionnaire will ask if disputes will be settled through mediation or arbitration.

2. Helps generate revenue

Licensing Agreements are a great way to help licensors earn money from their IP without producing or selling products themselves.

A licensor will usually receive royalties from licensees who use their IP. In some cases, the license could be paid for with a lump sum fee at the time of signing. In other cases, the licensee may be required to pay “royalty” payments. Royalty payments are based on the profits a licensee makes from using the intellectual property.

3. Market expansion and brand exposure

Finally, Licensing Agreements help licensors reach new markets without directly entering them. By partnering with established licensees, licensors can expand their brand's presence to a different customer base.

Licensing Agreements are beneficial for licensees because they can help boost credibility and attract more customers by using a recognized brand or technology.

Free Licensing Agreement

Create Your Free Licensing Agreement

Licensing Agreement

Location

Location

Your Licensing Agreement

What is a Licensing Agreement?

Parties to a Licensing Agreement

Key terms to create a Licensing Agreement

Types of Licensing Agreements

What are the benefits of Licensing Agreements?

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