Funds Release and Refund Authorization Policy

1. Scope

1.1 This Funds Release and Refund Authorization Policy (the "Policy") describes the conditions and authorizations under which escrowed funds or value are released, partially released, refunded, or otherwise disposed of in connection with an Escrow on the Escrow Bunny platform (the "Platform" or "Service").

1.2 This Policy is incorporated by reference into the Terms of Service and the Standard Escrow Agreement and is read together with the Buyer/Seller Escrow Instructions and the Dispute Resolution Policy. In the event of conflict, the [order of precedence in the Standard Escrow Agreement Section 1.4 / Terms of Service Section 1.3 controls — PLACEHOLDER pending counsel confirmation].

1.3 Capitalized terms not defined here have the meaning given in the Standard Escrow Agreement and the Terms of Service.

2. Definitions

• "Release" — disbursement or allocation of escrowed funds/value to a Party upon satisfaction of the applicable conditions and authorizations.
• "Partial Release" — a Release of part of the escrowed amount associated with a specific Milestone or portion of the Escrow. [Confirm whether partial Releases are supported by the product.]
• "Refund" — return of escrowed funds/value to the funding Party (typically the Buyer).
• "Cancellation" — termination of the Escrow or a Milestone without completion, which may result in a Refund or other configured outcome.
• "Release Authorization" — the recorded approval(s) and condition satisfaction required before a Release.
• "Milestone" — a defined stage gating approvals and Releases within the Escrow.
• "Dispute" — a disagreement raised under the Dispute Resolution Policy.
• "Ledger" — the Platform's immutable double-entry record of postings.
• "Audit Log" — the Platform's immutable, hash-chained event record.
• Other capitalized terms have the meaning given in the Standard Escrow Agreement and Terms of Service.

3. Escrow Bunny's Role and Limits

3.1 [CRITICAL THRESHOLD PLACEHOLDER — Release, holding, and Refund mechanics depend on whether, per the Standard Escrow Agreement Section 3.1 / Terms of Service Section 3.1, Escrow Bunny acts as a fund-holding escrow agent, a software-only platform with funds held by a third-party holder/processor, or another structure. Counsel must resolve this before this Policy is used; Sections 5–9 must then be conformed to the confirmed structure.]

3.2 Escrow Bunny operates the Release/Refund workflow in accordance with the Escrow Parameters, the recorded authorizations, this Policy, and applicable law. Escrow Bunny does not independently decide the merits of the underlying transaction except through the Dispute Resolution Policy.

3.3 The Platform does not pay interest on, or invest, escrowed amounts, and does not use cryptocurrency, blockchain, smart contracts, yield, or investment functionality. [Subject to Section 3.1 and any applicable trust-account/handling rules — counsel to confirm.]

3.4 Funding/settlement mechanism. [PLACEHOLDER — Stripe/payment processing is not active at launch unless designated future functionality. Confirm how funds are received, held, and disbursed at launch, if at all, including settlement timing and any third-party holder/processor. If no live funding/settlement exists at launch, this Policy applies to the authorization logic only until activated.]

4. General Principles

4.1 Funds are released only when the conditions and authorizations defined for the relevant Milestone (or the Escrow) are satisfied and recorded.

4.2 Funding gate (precondition). No funds can be in escrow, and therefore no Release or Refund can occur, unless the Escrow was funded after all required Buyer, Seller, and Organization verification gates passed and the Standard Escrow Agreement was accepted by all required Parties.

4.3 Dispute freeze. While a Dispute is open, release approval and fund Release for the Affected Scope are frozen and no Release of disputed amounts occurs until the Dispute is resolved under the Dispute Resolution Policy.

4.4 Immutability. Every Release, Partial Release, Refund, and Cancellation is recorded as an immutable double-entry Ledger posting and an immutable, hash-chained Audit Log event. Corrections are made by adjusting entries, never by altering posted records.

4.5 Authorizations are captured with the same rigor as other consents: by document/action type and version where applicable, with associated User, party role, timestamp, IP address, and user agent. [Confirm exact captured fields for authorization actions against the product/database specification.]

5. Release Conditions and Authorization

5.1 A Release occurs when all of the following are satisfied for the relevant Milestone (or the Escrow):

• the defined conditions for the Milestone are met;
• the required Release Authorization(s) are recorded; and
• no freeze (Dispute, verification, sanctions, legal, fraud, or security) applies to the Affected Scope.

5.2 Authorization model. [PLACEHOLDER — confirm against the product specification which authorization model applies, for example: (a) Buyer approval; (b) dual approval by Buyer and Seller; (c) condition/evidence-based; or (d) time-based auto-approval after a defined response window with no objection. State the default behavior if a Party does not act within the window. Specification not available for this draft; this model also drives the Standard Escrow Agreement Section 8.2, Buyer/Seller Escrow Instructions Section 6.3, and Dispute Resolution Policy Section 4.3.]

5.3 Recipient details. Release is made to the recipient and destination configured in the Escrow Parameters and verified per the KYC/KYB and Sanctions Screening Policy. [Confirm controls to prevent redirection of Release destination, and re-screening at time of Release if required.]

5.4 Settlement timing. [PLACEHOLDER — confirm settlement/disbursement timing and any holding period after authorization; depends on Section 3.1/3.4.]

6. Partial Releases

6.1 If supported, a Partial Release occurs per Milestone or per the portion of the Escrow whose conditions and authorizations are satisfied, with the remainder continuing to be held subject to this Policy. [PLACEHOLDER — confirm whether Partial Releases are supported and the mechanics; specification not available for this draft.]

6.2 A Partial Release does not waive conditions or authorizations for any remaining amount.

7. Refunds and Cancellations

7.1 A Refund or Cancellation may occur, as configured in the Escrow Parameters and permitted by this Policy and applicable law, in circumstances such as:

• mutual cancellation agreed by the required Parties;
• failure of a Milestone condition or expiry of the Escrow without satisfaction;
• a Dispute outcome directing a Refund or Cancellation under the Dispute Resolution Policy;
• a determination that the Escrow involves a Prohibited Transaction, sanctioned party, or failed/lapsed verification; or
• as otherwise required by law or legal process.

7.2 Refund destination. A Refund is returned to the funding Party using [the original funding source / a verified destination — PLACEHOLDER; confirm to mitigate fraud and money-laundering risk, and confirm re-screening at Refund if required].

7.3 Authorization for Refund/Cancellation. [PLACEHOLDER — confirm who must authorize a Refund or Cancellation in each scenario (e.g., mutual Party agreement, Dispute outcome, or Escrow Bunny action on compliance/legal grounds) and how it is recorded.]

7.4 Refunds and Cancellations are recorded as immutable Ledger postings and Audit Log events.

8. Holds, Freezes, and Withholding

8.1 Escrow Bunny may withhold, freeze, or delay a Release or Refund where:

• a Dispute is open on the Affected Scope;
• required verification is incomplete, has failed, or has lapsed;
• a sanctions, Prohibited Transaction, fraud, or security concern arises;
• legal process (e.g., a court order, lawful authority request, or hold) is received; or
• as otherwise required by law or the Policies.

8.2 Funds subject to a hold are dealt with in accordance with the applicable Escrow Parameters, this Policy, the resolution of the underlying issue, and applicable law. [PLACEHOLDER — confirm how withheld funds are handled pending resolution, including any escheatment/unclaimed-property obligations and the treatment of long-unresolved holds. Counsel decision; depends on Section 3.1.]

8.3 [Counsel to confirm notice obligations on a withholding/freeze and any restriction on disclosing the reason (anti-tipping-off) where a sanctions or suspicious-activity concern is involved.]

9. Errors and Adjustments

9.1 Because Ledger entries are immutable once posted, any correction of an operational or posting error is made by a subsequent adjusting entry, with a corresponding Audit Log event, not by altering the original record.

9.2 Escrow Bunny may make adjusting entries to correct demonstrable errors, subject to applicable law and notice. [Confirm error-correction governance, approval controls, and Party notice with counsel.]

10. Taxes and Fees

10.1 The Parties are responsible for their own taxes arising from the transaction. Escrow Bunny does not provide tax advice. [Confirm any withholding/reporting obligations with counsel.]

10.2 Whether fees apply to a Release, Partial Release, Refund, or Cancellation, and which Party bears them, is governed by [FEE TERMS — PLACEHOLDER; see Standard Escrow Agreement Section 13], including whether fees are refundable on Refund/Cancellation.

11. User Acknowledgements

By participating in an Escrow, each Party acknowledges and agrees that:

• Funds are released only when the defined conditions and required authorizations for the relevant Milestone (or Escrow) are satisfied and recorded.
• No Release or Refund can occur unless the Escrow was funded after required verification gates passed and the Standard Escrow Agreement was accepted.
• An open Dispute freezes release approval and fund Release for the Affected Scope.
• Escrow Bunny may withhold, freeze, or delay a Release or Refund for verification, sanctions, Prohibited Transaction, fraud, security, or legal reasons.
• Every Release, Partial Release, Refund, and Cancellation is recorded as immutable Ledger and Audit Log entries, and errors are corrected only by adjusting entries.
• The Parties are responsible for their own taxes and for the underlying transaction.

Acceptance capture: Acceptance of this Policy follows from acceptance of the Terms of Service and Standard Escrow Agreement and is recorded by document type and exact version, with associated User, timestamp, IP address, and user agent. Release/Refund authorization actions are additionally recorded with User, party role, timestamp, IP address, and user agent.

12. Contact / Legal Notice

• Operating entity: [LEGAL ENTITY NAME — PLACEHOLDER]
• Registered address: [ADDRESS — PLACEHOLDER]
• Escrow support: [SUPPORT EMAIL — PLACEHOLDER]
• Disputes: [DISPUTES CHANNEL — PLACEHOLDER; see Dispute Resolution Policy]
• Legal notices: [LEGAL NOTICE EMAIL / POSTAL ADDRESS — PLACEHOLDER; see Support, Complaints, and Legal Notices Policy]

13. Change History