A license agreement is a legal contract between two parties that outlines the terms and conditions governing the use of intellectual property such as software, technology or any other proprietary materials.
In this article, we will look at an example of a license agreement to provide a better understanding of what it entails and how it works.
License Agreement Example:
This License Agreement (“Agreement”) is made effective as of the date of acceptance by the licensee, by and between ABC Inc. (“Licensor”) and XYZ Inc. (“Licensee”).
1. Grant of License
Licensor hereby grants to Licensee a non-exclusive, non-transferable license to use the software program “ABC App” (“Software”) and associated documentation solely for its internal business purposes.
2. Restrictions on Use
Licensee shall not:
(a) copy or reproduce the Software or associated documentation in whole or in part;
(b) modify, adapt, or translate the Software, or create any derivative work based thereon;
(c) sell, license, sublicense or otherwise distribute the Software or associated documentation to any third party;
(d) use the Software for any illegal or unauthorized purpose.
3. Intellectual Property Rights
Licensor retains all rights, title, and interest in and to the Software and associated documentation, including all intellectual property rights therein. Licensee acknowledges that no title to the intellectual property in the Software or associated documentation is transferred to Licensee.
4. Warranty and Limitation of Liability
Licensor warrants that the Software, as delivered to Licensee, will be free from defects in material and workmanship for a period of 90 days from the date of acceptance by the Licensee. If during such warranty period, Licensee notifies Licensor in writing of any defect or non-conformity and Licensor is given an opportunity to correct such defects, Licensor will undertake such correction or repair.
Except as expressly provided in this Agreement, Licensor makes no warranties or representations, express or implied, whether arising by law, statute, usage of trade, or otherwise, including without limitation, warranties of merchantability, fitness for a particular purpose, non-infringement, or any other warranties arising from a course of dealing, usage, or trade practice.
In no event shall Licensor be liable to Licensee or any third party for any indirect, consequential, special, incidental, or punitive damages, including without limitation, loss of business, profits, data, or use, arising out of or related to this Agreement, the Software, or associated documentation, even if Licensor has been advised of the possibility of such damages.
5. Termination
Either party may terminate this Agreement at any time upon written notice to the other party if such other party breaches any material term or condition of this Agreement and fails to cure such breach within 30 days after receipt of written notice.
6. Governing Law and Jurisdiction
This Agreement shall be governed by and construed in accordance with the laws of the state of California, without regard to its conflict of laws provisions. Any action or proceeding arising out of or related to this Agreement shall be brought in a court of competent jurisdiction located in Los Angeles County, California.
7. Entire Agreement
This Agreement constitutes the entire agreement and understanding between the parties and supersedes all prior negotiations, understandings, and agreements between the parties, whether written or verbal. This Agreement may not be amended or modified except in writing signed by both parties.
In conclusion, a license agreement is a key legal document that outlines the terms and conditions governing the use of intellectual property. The example license agreement above provides a good overview of the key provisions that should be included in such a document to ensure the rights and obligations of both parties are clearly defined and understood.