Partnership agreement between Investor and "contractor"

[Miles Warren]

Hello,

I was contacted by a friend who wants to invest in flipping houses and me to do the work. He would basically be a silent investor, I would put together a bid to get the work done and pick and choose the work i would do myself and the work i would sub out to other contractors i know and have relationships with. He would fund the entire project from purchase of house to paying subs and materials. We are now at the point we need to write up a contract..... This is tricky and I'm looking for some advice, anyone with thoughts please share!!

[Rick H.]

Structure the deal first. Entity second.

I put about 10% of profit for finding the deal. Another 10 for putting it together. 25-39% for Someone to manage the project, the contractor(s) up to the point of sale and COE.  Probably up to half for funding it. My ratios may be way off from yours.

Break it down to reward for on-time and on-budget performance.  

Consider the value of preferred payouts for milestones or risk points.

Entity? THT is easy and cheap. Can use third party trustee.

Set up? Could be equity share note secured by TD or mortgage for either or both sides.