1. (a) An impound condition as described in Section 260.141.20 et seq of these rules may be imposed as a condition to the qualification of the program units.
2. (b) In those instances where a formal impound is not required, a provision must be included in the prospectus to the effect that all funds (including sales commissions and monies destined for reimbursement of offering costs) must be deposited in a trust account in a bank for the benefit of the participants of the program, subject to release only when the minimum program subscriptions have been deposited. The prospectus must also provide that such funds without deduction are to be promptly returned to the participants in the event that the minimum program subscriptions have not been obtained within the time specified in the prospectus, but in no event more than 6 months after commencement of the offering. A copy of the instructions to the bank utilized must be filed with the Commissioner prior to the effectiveness of the qualification.

Note: Authority cited: Section 25610, Corporations Code. Reference: Section 25140, Corporations Code.

History

1. Editorial correction adding Note filed 11-8-82 (Register 82, No. 46).