Red Oak Capital Fund III, LLC

Key economics

Preferred return

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Hurdle rate

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LP / GP split

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GP catch-up

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GP clawback

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GP commitment

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Diligence findings (16 · 4 high/critical)

• high
  DDQ gap: Does the fund engage an independent auditor?The offering documents don't answer a standard institutional DDQ question (Governance). An allocator will ask this directly — the GP should be ready with an answer.
• high
  DDQ gap: Does the fund have a GP clawback provision?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• high
  DDQ gap: What is the LP/GP carried-interest split above the preferred return?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• high
  DDQ gap: What is the preferred return (hurdle) rate offered to LPs?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• medium
  DDQ gap: Does the fund use a third-party fund administrator?The offering documents don't answer a standard institutional DDQ question (Governance). An allocator will ask this directly — the GP should be ready with an answer.
• medium
  DDQ gap: Is there a GP catch-up, and at what rate?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• medium
  DDQ gap: What distribution-waterfall structure does the fund use?The offering documents don't answer a standard institutional DDQ question (Structure). An allocator will ask this directly — the GP should be ready with an answer.
• medium
  DDQ gap: What is the GP's capital commitment (skin in the game)?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• medium
  Numeric inconsistency — organizational costs incurred ($0 vs approximately $30,000)Self-contradicting run-on in the financial-statement notes: states no organizational costs have been incurred and, in the same sentence, that approximately $30,000 has been incurred (also missing a space after 'applicable.').
• low
  Defined-term defect — Bond Service Reserve / Bond Service ObligationsThe summary introduces 'Bond Service Reserve' and references 'Bond Service Obligations, as defined herein,' but the body section is titled 'Bond Reserve' and never defines 'Bond Service Obligations' — inconsistent/undefined defined terms.
• low
  Document-quality defect — UMB Bank, P.A.Escrow payee in the subscription instructions is rendered 'UMB Bank, P.A.' whereas the bank is identified everywhere else in the document as 'UMB Bank, N.A.' — a wrong-suffix typo in a payment instruction.
• info
  Document-quality defect — stockholders' investmentsEquity-template carryover in a debt offering: an LLC bond deal with no stock or stockholders refers to 'stockholders' investments,' indicating boilerplate copied from an equity offering.
• info
  Spelling / typo — COMMISIONThe all-caps SEC legend misspells 'COMMISSION' as 'COMMISION' (one 'S').
• info
  Spelling / typo — complying the with 25% limitationGarbled word order 'complying the with' (should read 'complying with the'); the same broken phrase is repeated verbatim in three separate covenant passages.
• info
  Spelling / typo — on or and have our initial closingBroken/garbled sentence in the summary: 'on or and have our initial closing' contains a stray 'or' from an incomplete edit.
• info
  Spelling / typo — should viewedMissing verb 'be' in the prior-program track record: 'should viewed' should read 'should be viewed'.

DDQ readiness — 38% covered

5 answered · 0 partial · 8 gaps of 13 standard questions.