then why not just license the image for catalog use for 3 years? (and maybe add exclusivity for them). then the image is yours to sell or stick in a library after they have had exclusive use?
it sounds like you or they don't understand how licensing works so they ask for "royalty free" or "we want copyright" when they actually need neither.
if it was my image i would give them 2 prices. a silly high one for unlimited exclusive worldwide use and then a second one for what they actually need. i.e uk/europe catalog/pr use for 3 years (or whatever you think they need) they will soon see the sense in not paying for something they don't need.
a bit more info available here
http://beyond-the-lens.the-aop.org/
the NUJ may have some info too.