b'11. Prepare Your Offering Package & Raise MoneyBelow are some good rules of thumb for handling investor funds during the raise: If you have a minimum-maximum offering, you shouldnt use any in-vestor funds until the minimum dollar amount specified in the offering materials (if applicable) has been raised. If you are acquiring real estate in a specified offering, you shouldnt use any investor funds until you close on the property. If the minimum dollar amount is not raised by the date you specified in your offering materials, you shouldnt break impounds. All investor funds should be promptly returned without deduction. If the offering is for a specific property and that property is not acquired, you should promptly refund all investors funds without deduction. Note: If you use investor funds to pay yourself back for lost earnest money de-posits or due diligence costs and then dont close on a property, you will rightly have difficulty raising funds for another offering, so make sure you still have your day job. You may also get hit with a lawsuit. Your skin in the game is the money you put at risk for due diligence and pre-closing costs, including legal fees. If you dont close, you, and not your investors, should lose those funds. You must use a separate bank account in the companys name, or a se-curities escrow managed by a third-party trust company or bank, or a li-censed securities broker-dealer, for holding investor funds prior to raising the minimum dollar amount. Your attorney should review any securities escrow instructions to make sure they comply with your offering docu-ments and that they dont unnecessarily allow any adverse parties to con-trol your investors funds. 137'