Are you trying to sell her a license to reproduce your work. ie. She can make X amount of product for a price. Then, she must renew the license to produce more? Like blockbuster summer movie merchandising?

I guess yeah. Not sure. That is why I am asking about my rights. I was told by one person I can receive royalties for designs that are my own ideas or I can sell them out right (which I don't want to do). Then I keep seeing these usage rights terms that I can't seem to find samples of to get an idea of how it works, ugh!

http://mag.awn.com/index.php?ltype=pageone&article_no=3605

I found an answer to my question for those that are curious...

Unless otherwise specified in a contract, the graphic designer retains the right to his or her creations, and should always attempt to do so. When designing a work for a client, you are also selling specific rights to use it. Copyright laws protect against additional use without proper compensation or agreement.

For example: You design a logo for use on a specific product package for a cosmetics company. The company likes it so much that they decide to extend its use across their entire product line. You should be paid for this additional use, as it increases the value of the graphic work you created. For this reason, be sure to include in your contracts what the work can and cannot be used for.