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  3. Heads of Agreement Template


Heads of Agreement

The parties in this agreement are [Licensor..FirstName] [Licensor.LastName] (Licensor) and [Licensee.FirstName] [Licensee.LastName] (Licensee).

This heads of agreement is not a contract. It shall not be considered legally binding upon either party unless accepted as an attachment to a formally binding contract to be signed at a later date.

In order to satisfy mutual business needs, the Licensor and Licensee hereby communicate their intent to agree to the following:

PandaTip: The purpose of this template is to define intent and any concerns related to a potential software licensing agreement between two parties.

Licensed Items

The Licensor intends to provide the following software to the Licensee at the listed prices:

Name Price QTY Subtotal

Subtotal       $0.00
Total    $0.00

PandaTip: Use the template’s pricing table to list all software being considered, along with applicable licensing costs.

License Type

The Licensor shall provide a commercial, non-exclusive, non-transferable license should this heads of agreement be adopted as part of a formal software licensing agreement.

PandaTip: Because this heads of agreement template is specific to software licensing, it is important to document the type of license being offered to the Licensee.


The Licensee shall be allowed to modify and distribute the software being Licensed, with the following restrictions:

  • All final retail versions shall list the Licensor as a copyright owner and creator
  • Access to source code or files shall be kept confidential at all times


This heads of agreement shall be adopted as an exhibit to any software licensing agreement between the Licensor and Licensee. As such, it shall be valid for the entire term of any future agreement.

PandaTip: Because this heads of agreement template isn’t a contract, it doesn’t need an expiration date. Instead, it adopts the expiration date of any contract it becomes an exhibit to. In the “geographic limits” section of the template, the Licensor defines the area in which the Licensee shall be granted exclusive distribution rights.

Geographic Limits

The Licensee shall be granted the exclusive right to distribute the licensed software within the United States of America and its territories.

While the Licensee shall be allowed to sell to end users through the internet, geographic limits restrict the Licensee from selling the licensed software to any end user prohibited by the above geographic limitation.


The Licensee shall make all payments for software licenses related to this heads of agreement to the Licensor as follows:

Payment Terms: Net-30
Payment Method: Wire Transfer, Check, Credit Card
Payment To:
[Licensor.City], [Licensor.State] [Licensor.Zip]

Wire Transfer Information:
Routing Number: [Licensor.RoutingNumber]
Account Number: [Licensor.AccountNumber]


The Licensee agrees to allow the Licensor 30 days to review the listed software prior to entering into a subsequent software licensing agreement.

The Licensee shall make the Licensor aware of any defects discovered, which the Licensor shall correct at their expense prior to entering into a binding software licensing agreement.

PandaTip: The inspection section of this heads of agreement template gives the Licensee the right to inspect the listed software before entering into a formal software licensing agreement.


This heads of agreement shall remain under the jurisdiction of [Licensor.State] and applicable Federal or International law.


No portion of this heads of agreement shall be transferred to another party at any time. Should a third party acquire or otherwise gain control of the Licensor or Licensee, this heads of agreement shall be null and void.


Both parties hereby acknowledge receipt of this heads of agreement and full understanding of all terms and conditions found within.

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