IP licence agreement: to use specialist system

This agreement gives someone else the right to incorporate a system that you have developed into their own product or system, subject to limitations you decide, in return for a one-off or on-going payments.
Suitable for use in: England & Wales and Scotland
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About this document

This agreement licenses use of a system you have developed to another party for use within a system or process they use.

Your system could be anything.

It is likely to include a software component (perhaps a stand-alone application that captures or processes data, or perhaps an API, or perhaps uncompiled code) and maybe also some other IP, such as a graphical layout or a methodology.

Your system might process images, or facilitate communication between devices or calculate the optimal way to achieve an end goal.

Likewise, the reason for using your system could be any. The person or organisation to whom you license it could depend on it for the production of their primary product, or use it in a back office capacity to automate some tasks otherwise carried out by employees.

The industry in which it is used could be any. To make editing easier, in the document we refer to the system as software that facilitates HR management.

We give you the option to license for a single use, for sale within another system or product, or not for re-sale. We also allow you to set limitations on use, such as geographical ones and for what purpose your technology is used.

There are also multiple options for payment. For example, you may take a one-off fee, or an initial payment with on-going (subscription type) payments, or a fee based on usage.

There are options for additional services you might perform, such as consultancy on integration or upgrades, or training.

If you wish to sell your entire rights to someone else (who then could license it to others), it may be more appropriate to use a rights sale agreement.


The document comprehensive covers all the terms you may require. These include:

  • Definitions and interpretation
  • Warranties and understandings
  • Licensor’s representations about the subject matter
  • The licence deal
  • How the licensee can use your system
  • Extra limitations and permissions
  • Protection of licensed material
  • Renewal payments and credit card security
  • Confidentiality
  • Website security
  • Indemnities
  • Other matters relating to enforcement and other legal issues

Additionally, we include over 2,700 words of helpful drafting notes.


This document was written by a solicitor for Net Lawman. It complies with current English law.

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