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Profit Participation Agreement Dated Sep. 23,1997

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OVERLAND TRAILS LLC.
PROFIT PARTICIPATION AGREEMENT


THIS AGREEMENT, made and entered into this 23 day of September, 1997, by and between Overland Trails, L.L.C., a Utah Corporation (hereinafter referred to as "Overland") and W.W. Clyde, Inc., a Utah Corporation (hereinafter referred to as "Clyde")


WHEREAS, Overland is a corporation involved in the development and sale of real property in the Town of Eagle Mountain, Utah County, State of Utah,


WHEREAS, Clyde desires to provide labor and materials to Overland in connection with development of the real estate project above referenced, in the Town of Eagle Mountain,


WHEREAS, Overland desires to further compensate Clyde based upon CLYDE's agreement to accept payment for its material and labor when the building lots are sold.


NOW THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth, and other good and valuable consideration, the parties hereby agree as follows:


1) Clyde will provide goods and services to Overland for use in the real estate development project located in the Town of Eagle Mountain. Clyde will be compensated for its services as provided in other agreements as per Exhibit 1 Overland Trails, L.L.C. Owner-Contractor Agreement. Clyde will further be compensated and receive Twenty Three percent (23%) of the net profits derived from the sale of the building lots up to and not to exceed the sum of One Hundred Thousand Dollars ($100,000.00). Upon receipt by Clyde of the sum of One Hundred Thousand Dollars ($100,000.00), Clyde shall have no further claim for profits pursuant to this Agreement.


2) The profit participation payments, above referenced, shall be due and payable upon the closing of the sale of the last building lot within the project.


3) Clyde shall receive payment for labor and materials on the project, as referenced in other agreements, as each individual lot sale is closed and Clyde shall receive a pro rate payment on its contract computed by taking the total amount of contract as divided by the total number of lots. Said payments are separate and exclusive to this Profit Participation Agreement.


4) The parties acknowledge that this Agreement does not provide to Clyde any ownership interest in Overland or in the project, other than such rights as may accrue pursuant to Mechanic's liens.


5) Entire Agreement. This Agreement comprises the entire agreement between the parties and may not be modified or altered except by mutual agreement' in writing, signed by all parties concerned.


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6) Governing Law. The laws of the State of :Utah shall govern the construction and interpretation of this Agreement.


7) Severability. All agreements and covenants contained herein are coverable, and in the event any of them shall be held to invalid by any competent Court, this contract shall be interpreted as if such invalid agreements or covenants were not contained herein.


8) Enforcement. In the event of any action to enforce one or more of the terms of this Agreement, the party against whom enforcement is sought agrees that the party enforcing the agreement shall be entitled to an award of all costs of court, including costs of court and reasonable attorney's fees.


IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written.


OVERLAND TRAILS LLC
W.W. CLYDE & CO.


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THE AMERICAN INSTITUTE OF ARCHITECTS


- --------------------------------------------------------------------------------


AIA Document A107
ABBREVIATED FORM OF AGREEMENT
BETWEEN OWNER AND CONTRACTOR
For CONSTRUCTION PROJECTS OF LIMITED SCOPE where
the Basis of Payment is a STIPULATED SUM


1987 EDITION


THIS DOCUMENT HAS IMPORTANT LEGAL CONSEQUENCES; CONSULTATION WITH
AN ATTORNEY IS ENCOURAGED WITH RESPECT TO ITS COMPLETION OR
MODIFICATION.


This document includes abbreviated General Conditions and should not be
used with other general conditions. It has been approved and endorsed
by The Associated General Contractors of America.


- -------------------------------------------------------------------------------- AGREEMENT


made as of the day of September in the year Nineteen Hundred and Ninety-Seven


BETWEEN the Owner: Overland Trails, L.C. (Name and address) 130 West Main Street
Lehi, Utah 84043


and the Contractor: W. W. Clyde & Co. (Name and address) P.O. Box 350
Springville, Utah 84663


The Project is: Overland Trails Estate at Eagle Mountain (Name and location)


The Architect is: acknowledged to be the Owner's Designated (Name and address) Representative. Accordingly, any references in this
Agreement to Architect shall mean Owner's
Designated Representative. Owner's Designated
Representative: MCM Engineering, P.O. Box 189,
Heber City, Utah 84032


The Owner and Contractor agree as set forth below.


Copyright 1936, 1951, 1958, 1961, 1963, 1966, 1974, 1978, (C)1987 by Else Anon Institute of Architects, 1735 New York Avenue, N.W., Washington, D.C. 20006. Reproduction of the material herein or substantial quotation of its provisions without written permission of the AIA violates the copyright laws of the United States and will be subject to legal prosecution.


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ARTICLE 1
THE WORK OF THIS CONTRACT


1.1 The Contractor shall execute the entire Work described in the Contract Documents, except to the extent specifically indicated in the Contract Documents to be the responsibility of others, or as follows:


See Attachment #l: W. W. Clyde & Co.'s letter dated 02 Sept 1997 to complete the grading for the Outland Trails Estate.


ARTICLE 2
DATE OF COMMENCEMENT AND SUBSTANTIAL COMPLETION


2.1 The date of commencement is the date from which the Contact Time of Paragraph 2.2 is measured, and shall be the date of this Agreement, as first written above, unless a different date is stated below or provision is made for the date to be fixed in a notice to proceed issued by the Owner.


Within three (3) days after execution of this contract.


2.2 The Contractor shall achieve Substantial Completion of the entire Work not later than


, subject to adjustments of this Contract Time as provided in the Contract Documents.


ARTICLE 3
CONTRACT SUM


3.1 The Owner shall pay the Contractor in current funds for the Contractor's performance of the Contract the Contract Sum of Six Hundred Thirty Seven Thousand and 00/100 ------------------------Dollars ($ 637 000.00 ), subject to additions and deductions as provided in the Contact Documents.


3.2 The Contract Sum is based upon the following alternates, if any, which are described in the Contract Documents and are hereby accepted by the Owner:


None


3.3 Unit prices, if any, are as follows:


None


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ARTICLE 4
PROGRESS PAYMENTS


4.1 Based upon Applications for Payment submitted to owner by the Contractor, the Owner shall make progress payments on account of the Contract Sum to the Contractor as provided below and elsewhere in the Contract Documents. The period covered by each Application for Payment shall be one calendar month ending on the last day of the month, or as follows: Contractor shall by the tenth day of each month, deliver to Owner an Application for Payment showing in complete detail all monies paid out or cost incurred by Contractor during the period. Retainage will be in the amount of 5%. Retention will be released 30 days after completion of Project and acceptance of Owner. Owner shall make progress payments per Owner's Cash Flow Analysis dated 26 August 1997 (see attachment #2)


4.2 Payments due and unpaid under the Contract shall bear interest from the date payment is due at the rate stated below, or in the absence thereof, at the legal rate prevailing from time to time at the puce where the Project is located. Finance Charges will be assessed on a monthly basis on balance owed 30 calendar days after the work has been completed. A rate of (8%) per annum, which is (0.66%) per month will be assessed.


ARTICL
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