UBC Express Spin-Off License Agreement & Guide

UBC spin-off companies are new companies specifically formed to commercialize intellectual property (IP) or technology arising from research at UBC. Typically, at least one founder is a faculty member, researcher, staff member or student involved in the development of the licensed technology. Such spin-offs leverage university innovations, which are licensed under UBC’s Express License Agreement, to transition discoveries from academia into commercial products or services for public benefit.

The UBC Express Spin-off License Agreement is a standardized, non-negotiable license for UBC spin-off companies that want to commercialize university-developed technology. It provides:

• Exclusive rights to use and sublicense UBC technology for commercial purposes.
• A transparent, predefined financial structure to simplify negotiations.
• A balanced framework that protects UBC’s academic mission while supporting industry success.

UBC retains ownership of all licensed patents, technology, and UBC improvements, while:

• The spin-off owns any improvements it develops independently.
• Joint IP is co-owned if both UBC and the spin-off contribute to the improvement.

Of note, the UBC Express Spin-off License Agreement provides access to future UBC and Joint improvements at no additional costs, which is not the North American norm for academic IP licensing.

UBC grants the spin-off a worldwide, exclusive license to:

• Use and sublicense the UBC technology and any improvements.
• Manufacture and sell products based on the licensed technology.

However, UBC retains rights to:

• Use the technology for non-commercial research and educational purposes.
• Require sublicensing oversight to prevent misuse of UBC-developed IP.

These safeguards ensure UBC’s technology remains available for academic research while allowing commercialization.

The financial structure is predefined to:

• Ensure fairness and consistency across all UBC spin-offs.
• Reduce lengthy negotiations, allowing companies to focus on product development.
• Reflect reasonable compensation for UBC’s role in technology development.

The agreement includes three main financial components:

Royalties:

• 2% of revenue if the product is covered by a UBC patent.
• 1% of revenue if the product is not covered by a patent.

Equity:

• UBC receives at least 5% equity in the start-up (fully diluted).
• Anti-dilution protections for the first $2 million of investment raised ensure UBC’s share is maintained through early financings.

Annual Fees and Milestones:

• Starts at $5,000 and increases to $20,000 after six years.

These terms are below average in terms of North American academic IP licensing.

Yes, but with conditions:

• Sublicensees must be well-capitalized (market cap of $100M+).
• The terms of the sublicense do not conflict with the Express License Agreement
• UBC receives a share of sublicense revenue (10-20%, depending on development stage).

This ensures that UBC’s technology benefits the public and is not resold without reasonable compensation.

If the spin-off transfers or sells its business, UBC:

• Receives a $20,000 assignment fee to cover administrative and legal costs.

These terms protect UBC from losing control over how its technology is used, and by whom.

UBC owns and controls patents, ensuring broad protection.

• The spin-off must cover all patent costs, after an initial $20,000 contribution from UBC.
• If the spin-off assumes patent management, there must be a joint retainer, and UBC retains final approval to ensure proper protection.

This structure aligns with academic licensing norms, balancing UBC’s oversight with the spin-off’s commercialization interests.

The spin-off has first rights to enforce patents against infringers.

• UBC must approve litigation strategies to protect its broader interests.
• Any recovered damages are shared with UBC (treated as sublicense revenue).

This ensures patents are properly defended while preventing unnecessary litigation.

UBC is a public academic institution operating under the University Act of British Columbia, which mandates that it functions for the public good. Unlike private sector organizations, UBC:

• Cannot assume commercial liability for the spin-off’s use of the licensed IP.
• Does not control how the licensed IP is applied by the spin-off, product safety, regulatory approvals or commercialization risks, making it inappropriate for UBC to be held liable for commercialization risks.
• Must protect public funds and assets from exposure to third-party claims, as required by provincial policies on financial and risk management.

The spin-off must fully indemnify UBC against any legal claims related to the licensed technology. This is standard across Canadian university licenses.

Before commercial sales, the spin-off must secure product liability insurance.

During the term and three years after, the spin-off must maintain general business insurance.

This ensures that UBC is not exposed to financial risk from the spin-off’s operations.

Yes, but with industry-friendly safeguards:

• UBC provides 60-day advance notice of publications.
• If the spin-off identifies confidential information, UBC must remove it.
• If publication discloses potentially patentable IP, UBC delays publication for up to six months to allow for patent filings.

This preserves academic freedom while protecting the spin-off’s commercial interests.

Both parties agree to:

• Keep proprietary information secure.
• Limit disclosure to only necessary personnel.
• Comply with BC’s Freedom of Information laws, which may require UBC to disclose basic contract details.

These terms balance transparency with confidentiality protections.

The agreement is governed by the laws of British Columbia. UBC is a provincial entity with obligations to comply with BC legislation, including research governance, financial administration, and intellectual property policies. Since the BC government provides institutional funding and oversight, and the research and patents originate in BC, UBC must align its contractual obligations with provincial laws.