CAD and IP Agreement

1. Purpose. Client desires to engage Designer to create certain CAD files, models, drawings, specifications, prototypes, and related design services described in Exhibit A (the "Work"), and Designer agrees to perform such services subject to this Agreement.

2. Scope of Work. Designer shall perform the services and deliver the items described in Exhibit A (the "Services" and "Deliverables"). Any services not expressly included in Exhibit A shall be treated as additional services and billed at the rates set forth in Exhibit B or otherwise agreed in writing. Estimated timelines are good-faith targets only unless expressly stated as firm deadlines in Exhibit A.

3. Fees and Payment. Client shall pay the fees set forth in Exhibit B. Unless otherwise stated in Exhibit B: a [50%] deposit is due before work begins; progress invoices are due within [7/15/30] days of invoice date; and final payment is due before release of native CAD files or transfer of IP rights. Late payments accrue interest at the lesser of 1.5% per month or the maximum lawful rate. Pre-approved expenses are reimbursable. Except as expressly stated otherwise, payments are non-refundable once work has been performed.

4. Revisions and Change Orders. The price includes 3 rounds of reasonable revisions. Any change to scope, materials, dimensions, functionality, tolerances, file types, deadlines, or deliverables requested after approval of the initial concept may require a written change order and additional fees. Designer may pause work until a change order is approved.

5. Client Materials and Cooperation. Client shall timely provide all information, dimensions, logos, text, reference materials, approvals, and decisions reasonably needed for Designer to perform the Services. Client represents that it has all rights necessary for Designer to use any materials supplied by Client ("Client Materials"). Client is solely responsible for the accuracy of Client Materials and instructions supplied to Designer.

6. Ownership & Licensing Options

The Parties must select one licensing option in Exhibit B. If no option is selected, Option 1 applies by default.

Option 1 – Non-Commercial / Private Internal Use Only

6.1. Designer retains all right, title, and interest in and to the Work, Deliverables, and all related intellectual property, excluding Client Materials.

6.2. Upon full payment, Designer grants Client a non-exclusive, non-transferable, non-sublicensable license to use the final Deliverables solely for personal use or internal business use.

6.3. Client may not sell, distribute, sublicense, share, or commercially exploit the Deliverables in any way.

6.4. Unless otherwise stated in Exhibit B, Designer is not required to provide native or editable CAD files under this Option.

Option 2 – Commercial Rights (Physical Products Only)

6.5. Designer retains all ownership rights in the Work and related intellectual property, excluding Client Materials.

6.6. Upon full payment, Designer grants Client a non-exclusive, non-transferable license to manufacture and sell physical products derived from the final Deliverables.

6.7. Client may not resell, distribute, sublicense, or share the digital files, CAD files, or source files in any form.

6.8. Client may not claim ownership of the design or represent the design as their own intellectual property.

6.9. Unless otherwise stated in Exhibit B, Designer is not required to provide native or editable CAD files under this Option.

Option 3 – Full Ownership / Buyout

6.10. Upon full and final payment, Designer transfers all right, title, and interest in and to the final Deliverables expressly identified in Exhibit A to Client.

6.11. This transfer includes all transferable intellectual property rights, including copyrights, in the final Deliverables only.

6.12. Designer retains ownership of:

Pre-existing tools, templates, and workflows
General design knowledge and methods
Unused concepts, drafts, and iterations not selected by Client

6.13. Client receives the file formats specified in Exhibit A upon full payment.

6.14. Designer retains the right to display the work in portfolios and marketing unless otherwise agreed in writing.

7. Reservation of Rights. Except for the rights expressly granted in this Agreement, no rights are transferred by implication, estoppel, or otherwise.

8. Designer Tools and Pre-Existing IP. Designer retains ownership of all Designer Tools. If any Designer Tools are embedded in the Deliverables, Client receives only a non-exclusive license to use them as necessary for the permitted use of the Deliverables and no broader rights.

9. File Release. STL, STEP, DXF, PDF, renderings, or other file formats shall be released only as stated in Exhibit A and only after full payment. Native parametric or editable CAD files are not included unless expressly listed. Designer may withhold delivery while invoices remain unpaid.

10. Prototypes, Manufacturing, and Testing. Unless Exhibit A expressly includes engineering validation, Designer provides conceptual and design services only and does not warrant that any Deliverable is fit for production, structural use, load-bearing use, aviation use, medical use, firearm use, regulatory compliance, or any safety-critical application. Client is solely responsible for all prototype testing, production validation, tolerance verification, material selection, manufacturability review, and legal or regulatory compliance before commercial use. If Designer provides dimensions or tolerances, Client must independently verify them before manufacture.

11. Acceptance of Deliverables. Client shall review Deliverables within [5] business days after delivery. Deliverables shall be deemed accepted unless Client provides written notice specifying material nonconformities with Exhibit A within that period. Designer shall have a reasonable opportunity to cure any timely reported nonconformity.

12. Confidentiality. Each Party may receive non-public information from the other ("Confidential Information"). The receiving Party shall use Confidential Information only for performance of this Agreement and shall not disclose it to third parties except to employees, contractors, or advisors with a need to know and who are bound by confidentiality obligations.

(a) Confidential Information does not include information that is or becomes public through no fault of the receiving Party.

(b) Confidential Information does not include information already lawfully known to the receiving Party.

(c) Confidential Information does not include information independently developed without use of the disclosing Party's information.

(d) Confidential Information does not include information lawfully received from a third party without restriction.

13. Client Representations and Indemnity. Client represents that its instructions and Client Materials do not infringe third-party rights and do not violate any law. Client shall defend, indemnify, and hold harmless Designer and its owners, employees, and agents from claims, damages, liabilities, costs, and expenses, including reasonable attorneys' fees, arising out of Client Materials, Client's modification, manufacture, marketing, sale, or use of the Deliverables, Client's breach of this Agreement, or allegations that content supplied by Client infringes third-party rights.

14. Designer Limited Warranty and Disclaimer. Designer warrants that the Services will be performed in a professional and workmanlike manner. Except as expressly stated in this Agreement, the Services and Deliverables are provided AS IS and Designer disclaims all other warranties, express or implied, including warranties of merchantability, fitness for a particular purpose, non-infringement, and fitness for manufacture or commercial deployment.

15. Limitation of Liability. To the maximum extent permitted by law, Designer shall not be liable for any indirect, incidental, special, consequential, exemplary, or punitive damages, or any loss of profits, revenue, business opportunity, goodwill, or data, arising out of or relating to this Agreement. Designer's total cumulative liability shall not exceed the total fees actually paid to Designer under the project giving rise to the claim. These limits do not apply to fraud, willful misconduct, or obligations that cannot be limited by law.

16. Term and Termination. This Agreement begins on the Effective Date and continues until completion of the Services unless earlier terminated. Either Party may terminate for material breach if the other Party fails to cure within 10 days after written notice. Client may terminate for convenience upon written notice, but Client shall pay Designer for all work performed, time reserved, non-cancelable commitments, and approved expenses incurred through the termination date. Upon termination, any license granted to Client is suspended until all outstanding amounts are paid in full.

17. Independent Contractor. Designer is an independent contractor and not an employee, partner, joint venturer, or fiduciary of Client.

18. Publicity. Unless prohibited in Exhibit B, Designer may identify Client and display non-confidential images or descriptions of the project in portfolios, social media, trade materials, and marketing.

19. Dispute Resolution; Governing Law; Venue. This Agreement shall be governed by the laws of the State of North Carolina, without regard to conflict-of-law principles. Any legal action arising out of this Agreement shall be brought exclusively in the state or federal courts located in [Wayne County / Craven County / other NC county], and each Party consents to personal jurisdiction and venue there. Before filing suit, the Parties shall first attempt in good faith to resolve the dispute through direct negotiation for at least 10 business days after written notice of dispute.

20. Attorneys' Fees. In any action arising out of or relating to this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees and costs to the extent permitted by applicable law and if drafted and used in a manner enforceable under that law.

21. Notices. All notices under this Agreement must be in writing and sent by personal delivery, recognized overnight courier, certified mail return receipt requested, or email to the addresses below, or any updated address provided in writing. Notice is effective upon confirmed delivery.

22. Force Majeure. Neither Party shall be liable for delay or failure to perform caused by events beyond its reasonable control, excluding payment obligations.

23. Assignment. Client may not assign this Agreement without Designer's prior written consent. Designer may assign this Agreement to a successor in connection with a merger, sale, or transfer of substantially all assets.

24. Entire Agreement; Amendments. This Agreement, including all exhibits, constitutes the entire agreement between the Parties and supersedes prior discussions relating to its subject matter. Any amendment must be in a written instrument signed by both Parties.

25. Severability. If any provision of this Agreement is held invalid or unenforceable, the remaining provisions shall remain in full force, and the invalid provision shall be modified only to the minimum extent necessary to make it enforceable.

26. Waiver. No waiver of any breach shall be deemed a waiver of any other breach. A waiver is effective only if in writing and signed by the waiving Party.

27. Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which is deemed an original, and all of which together constitute one instrument. Signatures transmitted electronically or by PDF shall be deemed originals.