What is the appropriate profit sharing model between investor and general contractor?

[Prithvi Sri]

There a builder/general contractor who proposed rehabbing a half done project in LA area. The property is in a short sale (and the builder has a contract for this, and the lender is currently reviewing it). It looks like the lender will accept the short sale. Matter of when and not if.

The property costs around 1.9M and builder expects 700k spend to complete the project. Six months to get approvals and stuff, and six months to complete the project. Investor (myself) puts 500k down payment and holds the title to the property. Rest of the money is borrowed (hard money at 12% - that is 1900+700 - 500 = 2.1M). Once completed, the property can be sold for 3.5M based on comps (may be more than 4.0 but 3.7 is conservative). 

Builder suggests I take 150k after all the expenses and split the remaining profit (3.5 Million sale price - 170k sales commissions = 3.33M. Less 1.9M purchase price, 700k improvements, and 250k in interest results in 2.85 total costs and approx 500k net profit). My question is, what should be the rate of split for the net profit? I want this to be fair for the builder as well as for myself. 

P.S.: The builder has zero money invested into the project. I will be owning the title and the loan is non-recourse so if the project goes to dogs, I lose all my money. Builder gets paid for the improvements as part of construction loan.