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Capstone Projects/Student Projects/Studio Projects/Student Design Projects represent a partnership between the University and a federal, state, or industry sponsor.

These are typically senior level undergraduate courses or graduate courses offered to students that partner with a sponsor. These courses allow students to apply their education to real-world problems currently facing companies. These types of activities are mutually beneficial to both the sponsor and the University. Capstones can be funded or unfunded but regardless of funding, it is important to have an agreement in place signed by individuals who have signature authority, as this is an official university activity and signed agreements protect all parties involved. 

Why is a capstone agreement needed?

  • Without an agreement in place and approval of the University, everything could be considered an individual action and an individual risk on the part of the faculty member.
  • Without an agreement in place, a sponsor/client could walk away from a project mid-semester jeopardizing the student’s course credit.
  • Without an agreement in place, the institution would not have an opportunity to identify topics or terms and conditions with high risks (reputational, compliance, financial, export controlled, etc.)
  • Without an agreement in place, the University would not be able to screen to ensure that the sponsors are in good standing with the government or the state of Texas. The University is not allowed to have formal collaborations with these sponsors.
  • Without an agreement in place, neither the University nor the sponsor could promote or market that a formal collaboration exists between the two parties.
  • Without an agreement in place that includes separate agreements from the student with the sponsor, there is nothing to stop a student from using the client/sponsor’s confidential or proprietary information for purposes other than the classroom project or to use it after graduation if working for a competitor of the sponsor.
  • Without an agreement in place, there is nothing binding the University or student to provide the deliverable.              


Why would a client/sponsor prefer not to execute an agreement for these projects?

  • Many times, when there is a document for signature that has terms and conditions, the client/sponsor will be required to route it through their legal office, which can be a burdensome and lengthy process for such a small outlay of funds.
  • Sponsors may erroneously think that such an agreement is subject to mandatory indirect costs for funding the PI effort, and they want to avoid that expense.

These agreements should be handled as sponsored agreements where the University is bound by terms and conditions and the promise of a performance and deliverables to the sponsor. These monies cannot be accepted as gifts and the student asked to sign associated intellectual property waiver agreements associated with a “gift.”  Gifts do not have deliverables or statements of work or obligations to perform in return for the funds. Also, funds should not be given directly from the sponsor to the students outside of the University records for travel or supplies. Funding for the project needs to go through the University so that contract compliance can be assured. This removes personal burdens and responsibilities placed on students or faculty members.

Each student course project should have an agreement in place to protect all parties involved. The agreements drafted for the capstone projects are very benign and are used to simply outline the responsibilities of the University, student, and client/sponsor along with identify the goals of the project and any deliverables.

“It is important that the University and the partners sponsoring the project jointly establish, up front, a clear written framework that reflects their shared expectations for the project and timelines. In addition to providing a positive student experience, successful capstone projects can generate additional collaboration opportunities for universities and provide company sponsors with better access to new ideas and the talent pipeline” – UIDP Working Group

How long will this process take?

The length of time from request for a capstone agreement to notice of award or signed agreement from an industry sponsor can vary widely. 

Texas A&M University has standard capstone and student agreement templates. If the sponsor is a US based company or government agency and accepts one of the templates without modification, the agreement can be signed by the department head per the vice president for research re-delegation of authority here.  If the sponsor is a foreign organization or individual, the templates may be used but signature authority will be in the Office of the Vice President for Research, obtaining this signed agreement may take less than a week. However, this may change, depending on how quickly the necessary approvals and/or compliance protocols are obtained. 

The fastest way to expedite this process is to provide the sponsor with the standard capstone agreement template as soon as discussions begin for a potential capstone project. In addition, please provide all information gathered for a potential capstone to the Division of Research as early as possible if the sponsor will not utilize one of the approved templates. 

Although some negotiations may be lengthy, it is important that no activities for a capstone project are conducted prior to the contract being executed. This is even more important if confidential information or intellectual property is exchanged as part of the project.

The standard capstone and student agreement templates can be found below. These agreements are short and written in lay terms to help expedite the review process. Utilizing the University’s template agreement also gives us the ability to quickly tailor the agreement if requested by a sponsor.

Capstone and Student Agreement Templates

Funded Capstone and Student Agreement

Unfunded Capstone and Student Agreement

Capstone MOU with US Governmental Agency – Bush School of Government and Public Service

Department of Biomedical Engineering Capstone and Student Agreement 


Do I need a proposal?

No. A proposal will only be created and routed when requested by the sponsor.


Will the University charge Indirect Costs (IDC) or a fee on this project?

No, all indirect costs have been waived on these student projects as well as the requirement for principal investigator (PI) time and effort on the project. Unlike a gift, there is no gift tax of 5 percent. 

Capstone agreements are considered partnerships in which both sides are equally contributing. Therefore, indirect costs and the requirement of PI time on the project are waived. The PI’s effort on a capstone agreement is budgeted on the classroom effort side of the house, which suffices for time on the project. Therefore, there is no need to try to classify the funding as a gift since a gift would not allow deliverables that would be due to the sponsor. There is also no need to try to have students accept funds directly from the sponsor to buy supplies, travel, etc. All of this can be handled through the University as a sponsored project

Can support for a capstone project be accepted as a gift?

The University can accept support in the form of a gift if it is truly a gift. The funding provided cannot be accepted as gift if any of the following apply:

  • A technical scope of work or research statement provided by either the sponsor or University is required
  • The sponsor anticipates a deliverable, including a report or presentation summarizing a student project
  • A time limit or term has been provided for use of the funds
  • The sponsor intends to ask the students to sign an IP agreement
  • There is confidential information exchanged
  •  Sponsor will provide oversight or participate in the allocation of funds


Things to Remember

  • Faculty members do not have the authority to sign an agreement on behalf of the University, its students, resources, etc. or bind the University in any way. This violates both university rules and the state of Texas ethics laws. By signing an agreement, work statement, or anything that involves the University, faculty could be held personally liable.
  • Students not electing to waive their intellectual property in support of the Capstone sponsor may do so and will have to be offered a substitute assignment/project to fulfill degree requirements.
  • The University does not have legal authority over its students, including the students’ intellectual property or a student’s breach of confidentiality that may occur during their time at Texas A&M or in their future. This is why students are required to sign a separate agreement with the sponsor covering intellectual property and confidentiality terms. This means Texas A&M cannot enforce confidentiality or IP terms on our students, nor can we go after them for a breach. This also means that the sponsor cannot go after Texas A&M for a student’s breach of the agreement made between the student and the sponsor.


For help or questions about capstones, or to request a department specific capstone template, please contact The Division of Research, Research Administration, Ms. Autumn Biggers at 458-1140,