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In this video, Matthew guides viewers on creating a licensing agreement using legal templates. He refers to a link provided underneath the video that directs to legaltemplates.net. Matthew navigates to the "Business Forms" section to find the licensing document, specifically the "License Agreement." He demonstrates selecting Texas as the jurisdiction and starting the document creation. Key components include identifying the owner of the intellectual property, the acquiring licensee (Mr. Add), and specifying the type of license (exclusive or non-exclusive). Matthew encourages viewers to fill in relevant details regarding the intellectual property and to outline the agreement's purpose.