What Does “License” Mean in a Contract?
Permission to use someone's property or intellectual property under specified conditions, without transferring ownership.
Detailed Explanation
A license grants permission to use something without ownership transfer. The licensor retains ownership; the licensee gets usage rights. Licenses can be exclusive (only the licensee can use), non-exclusive (others can also be licensed), limited (restricted uses), or broad.
Software contracts typically involve licenses - you don't own the software; you're licensed to use it under specific terms.
Example in a Contract
“Company grants Client a non-exclusive, non-transferable license to use the Software solely for Client's internal business purposes, subject to the limitations set forth herein.”
Why It Matters
Licenses let you use things you don't own. Understand your license scope - what can you do with it? Can you modify it? Sublicense it? Transfer it? Operating outside your license is infringement.
Related Terms
Have a Clause with “License”?
Paste your contract clause below for instant AI analysis. Get risk assessment, plain English explanation, and suggested improvements.