Exhibit 10.32

ESCROW AGREEMENT

This Escrow Agreement, dated as of February 26, 2010, among Joel Stephen Logan
II, an individual (“Logan”); Charles L. Murphree Jr., an individual
(“Murphree”); John Steven Lawler, an individual (“Lawler”); James David Shaw, an
individual (“Shaw”); William Joseph Aycock, Jr., an individual (“Aycock”); Jerry
Ray Cooper, Jr., an individual (“Cooper”); Timothy Wayne Gann, an individual
(“Gann”); and Jimmy Ray Hawkins, an individual (“Hawkins”) (individually, a
“Seller” and collectively, the “Sellers”) and Deer Valley Homebuilders, Inc., an
Alabama corporation (“DVHB”) and Deer Valley Corporation, a Florida corporation
(“Deer Valley”), as successor to DeerValley Acquisitions Corp., a Florida
corporation (all previously listed entities, including the Sellers, are
collectively the “Parties”); and Bush Ross, P.A. a Florida professional
association, as escrow agent (“Escrow Agent”). Capitalized terms used in this
Agreement not otherwise defined herein shall have the respective meanings given
to them in the Second Amendment to Earnout Agreement (the “Amended Earnout
Agreement”) dated February 26, 2010 between the Sellers and DVHB and Deer Valley
to amend the Earnout Agreement dated January 18, 2006, as amended by the First
Amendment to Earnout Agreement dated November 19, 2007 (the “Transaction”).

Background

The Amended Earnout Agreement provides that Deer Valley shall, among other
things, purchase 2,000,000 shares of common stock of Deer Valley (“Common
Stock”) from the Sellers for Seven Hundred Thousand and No/100 Dollars
($700,000), which the Sellers are required to place in escrow to be released in
accordance with the terns and conditions of the Amended Earnout Agreement.
Accordingly, in consideration of the foregoing and the respective covenants and
promises set forth in this Agreement, and for other good and valuable
consideration, the Parties hereby agree as follows:

Operative Provisions

 

1. Appointment of the Escrow Agent. The Parties hereby appoint Escrow Agent to
serve as, and Escrow Agent hereby agrees to act as, escrow agent upon the terms
and conditions of this Agreement. Notwithstanding the references in this
Agreement to the Amended Earnout Agreement, the Parties acknowledge that Escrow
Agent is not a party to the Amended Earnout Agreement for any purpose or
responsible for it interpretation or enforcement.

 

2. Deposit in Escrow. In accordance with the Amended Earnout Agreement, the
Sellers are depositing with Escrow Agent a total of Seven Hundred Thousand and
No/100 Dollars ($700,000) (the “Escrowed Cash”). Escrow Agent hereby
acknowledges receipt thereof. Escrow Agent hereby agrees to act as escrow agent
and to hold, safeguard and disburse the Escrowed Cash pursuant to the terms and
conditions hereof.

 

3. Appointment of Representative. Each of the Sellers hereby appoint Logan as
his authorized representative to provide and receive notices referenced herein,
and to otherwise act on their behalf in connection with the Escrowed Cash
(“Sellers’ Representative”).

 

4.

Escrow Distributions. The Parties agree that the Escrow Cash shall be released
in accordance with the terms and conditions of the Amended Earnout Agreement.
The procedure for distribution shall be as follows: Written notice shall be
provided to Escrow Agent by Deer Valley, on the one hand, or by the Sellers
Representative, on the other, stating that a Distribution Date (as defined set
forth in the Amended Earnout Agreement) has occurred and the Escrowed Cash is to
be released (the “Notice”). Such Notice shall specify the amount of cash to be
released and shall provide instructions on how to release the Escrowed Cash.
Within five (5) days of Escrow Agent receiving the Notice, Escrow Agent shall
transmit the Notice to Deer Valley, if provided by the Sellers’ Representative,
or to the Sellers’ Representative, if provided by Deer Valley. At such time, the
receiving party shall have twenty (20) days (the “Objection Period”) within
which to a provide written objection to the Escrow Agent contesting the release
of Escrowed Cash as specified in the Notice (an “Objection”). An Objection will
be deemed received upon receipt by the Escrow Agent. If an Objection is received
by the Escrow Agent, the Escrow Agent shall hold the Escrowed Cash until either
(1) the Escrow Agent receives written instructions for distribution executed by
Deer Valley and the Sellers’ Representative;

 

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or (2) a judge having jurisdiction over the Amended Earnout Agreement shall
provide other instructions to the Escrow Agent. If an Objection is not received
during the Objection Period, the Escrow Agent shall distribute the Escrowed Cash
in accordance with the Notice.

 

5. Termination of Escrow. Upon written notice executed by Deer Valley and the
Sellers’ Representative that this Escrow Agreement has been terminated, Escrow
Agent shall distribute the then remaining Escrowed Cash as directed in the
written notice.

 

6. Duties of Escrow Agent.

 

  (a) Escrow Agent shall not be under any duty to give the Escrowed Cash held by
it hereunder any greater degree of care than it gives its own similar property
and shall not be required to invest any cash held hereunder except as directed
in this Agreement.

 

  (b) Escrow Agent shall not be liable for actions or omissions hereunder,
except for its own willful misconduct and, except with respect to claims based
upon such willful misconduct that are successfully asserted against Escrow
Agent, the Parties shall jointly and severally indemnify and hold harmless
Escrow Agent (and any successor Escrow Agent) from and against any and all
losses, liabilities, claims, actions, damages and expenses, including reasonable
attorneys’ fees and disbursements, arising out of and in connection with this
Agreement.

 

  (c) Escrow Agent shall be entitled to rely upon any order, judgment,
certification, demand, notice, instrument or other writing delivered to it
hereunder without being required to determine the authenticity or the
correctness of any fact stated therein or the propriety or validity of the
service thereof. Escrow Agent may act in reliance upon any instrument or
signature believed by it to be genuine and may assume that the person purporting
to give receipt or advice or make any statement or execute any document in
connection with the provisions hereof has been duly authorized to do so. Escrow
Agent may conclusively presume that the undersigned representative of any party
hereto which is an entity other than a natural person has full power and
authority to instruct Escrow Agent on behalf of that party unless written notice
to the contrary is delivered to Escrow Agent.

 

  (d) Escrow Agent may act pursuant to the advice of counsel with respect to any
matter relating to this Agreement and shall not be liable for any action taken
or omitted by it in good faith in accordance with such advice.

 

  (e) Escrow Agent does not have any interest in the Escrowed Cash deposited
hereunder but is serving as escrow holder only and has only possession thereof.
Any payments of income from the Escrowed Cash shall be subject to withholding
regulations then in force with respect to United States taxes. The parties
hereto will provide Escrow Agent with appropriate Internal Revenue Service Forms
W-9 for tax identification number certification, or nonresident alien
certifications. This Section 7 shall survive notwithstanding any termination of
this Agreement or the resignation of Escrow Agent.

 

  (f) Escrow Agent shall not be called upon to advise any party as to the wisdom
in selling or retaining or taking or refraining from any action with respect to
any securities or other property deposited hereunder.

 

  (g) Escrow Agent (and any successor Escrow Agent) may at any time resign as
such by delivering the Escrowed Cash to any successor Escrow Agent jointly
designated by the other parties hereto in writing, or to any court of competent
jurisdiction, whereupon Escrow Agent shall be discharged of and from any and all
further obligations arising in connection with this Agreement. The resignation
of Escrow Agent will take effect on the earlier of (i) the appointment of a
successor (including a court of competent jurisdiction) or (ii) the day which is
ten (10) days after the date of delivery of its written notice of resignation to
the Parties. If, at that time, Escrow Agent has not received a designation of a
successor Escrow Agent, Escrow Agent’s sole responsibility after that time shall
be to retain and safeguard the Escrowed Cash until receipt of a designation of
successor Escrow Agent or a joint written disposition instruction from the
Parties or a final, nonappealable order of a court of competent jurisdiction.

 

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  (h) The Parties shall pay Escrow Agent, at its standard hourly rates, for
services rendered by Escrow Agent hereunder and agree to reimburse Escrow Agent
for all reasonable expenses, disbursements and advances incurred or made by
Escrow Agent in performance of its duties hereunder (including reasonable fees,
expenses and disbursements of its counsel). Any fees or expenses of Escrow Agent
or its counsel that are not paid as provided for herein may be taken from any
property held by Escrow Agent hereunder.

 

7. Limited Responsibility. This Agreement expressly sets forth all the duties of
Escrow Agent with respect to any and all matters pertinent hereto. No implied
duties or obligations shall be read into this Agreement against Escrow Agent.
Escrow Agent shall not be bound by the provisions of any agreement among the
other parties hereto except this Agreement.

 

8. Notices. All notices, consents, waivers and other communications required or
permitted under this Agreement shall be in writing and shall be deemed given to
a party when (a) delivered to the appropriate address by hand or by a nationally
recognized overnight courier service (costs prepaid); (b) sent by facsimile
(with confirmation by the transmitting equipment); or (c) received by the
addressee, if sent by certified mail, return receipt requested, in each case to
the following addresses and facsimile numbers and marked to the attention of the
person (by name or title) designated below (or to such other address, facsimile
number or person as a party may designate by notice to the other parties):

If to Deer Valley, to:

Deer Valley Corporation

4904 Eisenhower Blvd., Suite 185

Tampa, Florida 33634

Attn: Charles G. Masters

If to the Sellers, to:

Attn: Joel Stephen Logan II

205 Carriage St.

Guin, Alabama 35563

If to Escrow Agent, to:

Bush Ross, P.A.

220 South Franklin Street

Tampa, Florida 33602

Facsimile No. (813) 223-9620

Attn: Brent A. Jones

 

9. Jurisdiction; Service of Process. Any proceeding arising out of or relating
to this Agreement may be brought in the courts of the State of Florida, County
of Hillsborough, or, if it has or can acquire jurisdiction, in the United States
District Court for the Middle District of Florida, and each of the parties
irrevocably submits to the exclusive jurisdiction of each such court in any such
proceeding and waives any objection it may now or hereafter have to venue or to
convenience of forum, agrees that all claims in respect of the proceeding shall
be heard and determined only in any such court and agrees not to bring any
proceeding arising out of or relating to this Agreement in any other court.
Process in any proceeding referred to in the preceding sentence may be served on
any party anywhere in the world.

 

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10. Execution of Agreement. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement. The exchange of copies of this Agreement and of
signature pages by facsimile transmission shall constitute effective execution
and delivery of this Agreement as to the parties and may be used in lieu of the
original Agreement for all purposes. Signatures of the parties transmitted by
facsimile shall be deemed to be their original signatures for any purposes
whatsoever.

 

11. Waiver. The rights and remedies of the parties to this Agreement are
cumulative and not alternative. Neither the failure nor any delay by any party
in exercising any right, power or privilege under this Agreement or the
documents referred to in this Agreement will operate as a waiver of such right,
power or privilege, and no single or partial exercise of any such right, power
or privilege will preclude any other or further exercise of such right, power or
privilege or the exercise of any other right, power or privilege. To the maximum
extent permitted by applicable law, (a) no claim or right arising out of this
Agreement or the documents referred to in this Agreement can be discharged by
one party, in whole or in part, by a waiver or renunciation of the claim or
right unless in writing signed by the other party; (b) no waiver that may be
given by a party will be applicable except in the specific instance for which it
is given; and (c) no notice to or demand on one party will be deemed to be a
waiver of any obligation of such party or of the right of the party giving such
notice or demand to take further action without notice or demand as provided in
this Agreement or the documents referred to in this Agreement.

 

12. Entire Agreement and Modification. This Agreement supersedes all prior
agreements among the parties with respect to its subject matter and constitutes
(along with the documents referred to in this Agreement) a complete and
exclusive statement of the terms of the agreement between the parties with
respect to its subject matter. This Agreement may not be amended except by a
written agreement executed by each of the Parties and the Escrow Agent.

 

13. Governing Law. This Agreement shall be governed by the laws of the State of
Florida without regard to conflicts of law principles that would require the
application of any other Law.

 

14. Waiver of Conflict. The Escrow Agent represents Deer Valley in various legal
matters including consummation of the Transaction. The Escrow Agent has agreed
to serve as the escrow agent as an accommodation to the parties hereto. Each
party waives any conflict of interest that it might be able to assert against
the Escrow Agent’s continued representation of Deer Valley or any of its
Affiliates in the matters contemplated by the Amended Earnout Agreement, any
dispute arising thereunder or otherwise.

 

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The parties have executed and delivered this Escrow Agreement as of the date
first written above.

 

DEER VALLEY CORPORATION By:  

/s/ Charles G. Masters

  Charles G. Masters, President & CEO DEER VALLEY HOMEBUILDERS, INC. By:  

/s/ Charles G. Masters

  Charles G. Masters, Chairman Board of Directors SELLERS:

/s/ Joel Stephen Logan, II

Joel Stephen Logan, II

/s/ Charles L. Murphree, Jr.

Charles L. Murphree, Jr.

/s/ John Steven Lawler

John Steven Lawler

/s/ James David Shaw

James David Shaw

/s/ William Jospeh Aycock, Jr.

William Joseph Aycock, Jr.

/s/ Jerry Ray Cooper, Jr.

Jerry Ray Cooper, Jr.

/s/ Timothy Wayne Gann

Timothy Wayne Gann

/s/ Jimmy Ray Hawkins

Jimmy Ray Hawkins BUSH ROSS, P.A. By:  

/s/ Brent A. Jones, Esq.

Name:  

Brent A. Jones, Esq.

Its:  

Vice President

[SIGNATURE PAGE – AMENDED AND RESTATED ESCROW AGREEMENT]

 

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