A licensing agreement also called a licensing contract is a legal document between two parties i.e. the licensor and the licensee wherein the right to use the trademark, patent, brand name, or to manufacture and sell the goods owned by the licensor are transferred to the licensee. The right to use the intellectual property owned by the licensor is also vested upon the licensee.
Speaking of intellectual property, copyright license plays a huge role in this domain. A copyright license is given to a licensee by the owner or inventor of the product who does not want to lose the rights to ownership of the product. The licensee utilizes the product to earn revenue and a part of such revenue created is also given to the licensor (original owner) as royalty. It is paid as a lump sum or in installments according to the terms agreed upon by both parties.
Types of licensing agreements:
The license agreement also includes patents, trademarks, copyrights, and trade secrets.
A software license agreement is a contract between the licensor and the licensee wherein the licensee is granted the right to use the software but not own it. The licensor is free to sell the software to any other person or entity and may also limit the use of such software to a single device or computer. It protects the ownership of the codes, data and programs of the software while allowing it to be sold and used by the buyer or the licensee.
A software license agreement is also referred to as an End-user license agreement. You may have come across the term end-user license while installing any kind of software as it requires you to sign the license digitally after reading it or the installation will stop mid-way or become incomplete.
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