When ICE is started, it will look in some predefined locations for this license file. If it cannot find a valid license, it will prompt you to install one, and help you in this process. The easiest procedure to install your license, is to start ICE, and make use of the GUI to install your license.
Your license file will only be valid for a particular release version of ICE. If you transfer to a newer release version, you will most likely need a new license file as well.
Notes - Your license file can hold various restrictions (e.g. limited number of days it is valid). When this restriction expires, you will need another license file.