Definition
A license agreement is the contract that defines the scope, payment, exclusivity, and other terms under which a patent owner permits another to use the invention.
Why It Matters Legally
The license agreement governs the entire relationship and determines what rights the licensee actually gets. Ambiguous or poorly drafted terms are a common source of costly disputes.
Example Use Case
A license agreement specifies that the licensee may sell the patented product only in North America and must pay quarterly royalties.
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Related Terms
Licensing, Royalty, Cross-License, Exclusive License, Assignee