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Confidentiality and IP

Licensing agreement template

Licensing agreement: A licensing agreement lets one party use another’s intellectual property, such as a brand, content, patent or technology, on agreed terms while ownership stays with the licensor.

Last reviewed 6 November 2026 · 7 clauses · General guidance, not legal advice

Upload yours for a review and e-signature, or save it as a team template.

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When to use a licensing agreement

  • Letting a partner use your brand or content
  • Licensing a patent or technology to a manufacturer
  • Granting regional rights to sell under your name

Licensing agreement template: clause-by-clause outline

Sample starting wording for each clause. Replace the text in [brackets] with your details.

  1. Grant

    The Licensor grants the Licensee a [non-exclusive / exclusive], non-transferable licence to use the Licensed IP for [field of use] in [territory].

  2. Restrictions

    The Licensee will not sublicense, modify or use the Licensed IP outside the scope of this licence.

  3. Royalties

    The Licensee will pay [x]% of net sales of Licensed Products, quarterly within [30] days of each quarter end.

  4. Reports and audit

    The Licensee will keep accurate records and allow the Licensor to audit them once a year on reasonable notice.

  5. Quality control

    Licensed Products will meet the Licensor’s quality standards and brand guidelines.

  6. Ownership

    The Licensor keeps all rights not expressly granted. Improvements made by the Licensee belong to [party].

  7. Term and termination

    This licence lasts [3] years and may be terminated if royalties are unpaid for [30] days after notice.

What to check before you sign

  • Is the licence exclusive, and if so, are there minimum royalties?
  • Who owns improvements?
  • Is the territory and field of use clear?

How to send a licensing agreement for e-signature

  1. Draft or upload it. Use the outline above with your own wording, upload an existing document, or save it as your organisation’s template.
  2. Check it against your playbook. Points outside your positions are flagged, and approval rules route it to Legal when needed.
  3. Send it by email. Signers get a plain-language review and a secure link, sign on any device in the order you set, and can suggest changes as tracked changes.
  4. Keep the signed PDF. Everyone receives it with a certificate of completion, and key dates go to Upcoming with reminders.

Licensing agreement template: frequently asked questions

What is a typical royalty rate?

It varies by industry: low single digits for manufactured goods, higher for software and brands. Base it on comparable deals and margin.

Can a licence be exclusive in one country only?

Yes. Territory and field of use can be split so different licensees hold exclusive rights in different markets.

Is an electronically signed licensing agreement legally binding?

In most countries, yes. E-signatures are recognised for commercial contracts under laws such as the ESIGN Act (US), eIDAS (EU), the Electronic Communications Act (UK) and the Information Technology Act (India). econtracts.ai adds a certificate of completion with each signer’s identity check and a fingerprint of the signed content.

Can I get a licensing agreement I received reviewed?

Yes. Upload it to econtracts.ai and you get a plain-language review: key dates, money and points to check, each quoting the clause it comes from.

Related contract templates

IP assignment agreement templateIntellectual property assignment agreementSoftware license agreement templateSoftware licence agreementFranchise agreement templateFranchise agreement

This outline is a starting point for discussion, not legal advice, and it is not a complete contract. Laws differ by country and sector; have a qualified lawyer review contracts that matter.