Red Oak Capital Fund VII, LLC

Cascade · Distributions

Where each dollar goes

$875K

LP $846K · Fees $29K · GP $0

Standard scenario · $500K equity · 5y hold · 1.75× exitRun your own cascade →

Deal diligence15 findings · worst high

Automated checks across the fund's extracted PPM. Every finding is shown with the evidence it's based on — proven numbers or a verbatim quote and page.

Waterfall structure

Structural checks run against Red Oak Capital Fund VII, LLC's extracted waterfall. Each is a deterministic test — the numbers shown are proven from the PPM, not estimated.

Disposition Fee (0.5%) is taken above the waterfall

Medium

A performance- or transaction-linked fee paid above the waterfall reaches the GP before the LP's distribution priorities run, eroding the pool the pref + return-of-capital draw from. Routine asset-management fees above the line are normal; a disposition/promote-flavored fee there is a leak worth pricing.

“The Manager will also receive 0.50% of the proceeds received from the repayment of the principal amount of any of our debt investments or any other disposition of the underlying real estate.”

PPM p.1485% confidence

Document quality

Drafting defects found in the PPM prose — numeric inconsistencies, broken cross-references, unfilled placeholders, and defined-term problems. Each is shown with the offending quote and its page.

Numeric inconsistency — Bond maturity date (December 31, 2029 vs December 31, 2028)

High

The offering-circular body states the Bonds mature December 31, 2029, but the audited financial statements (Note 4) state the maturity date is December 31, 2028 — a one-year discrepancy on a core economic term.

“The Bonds will mature on December 31, 2029. ... The maturity date of the Bonds will be December 31, 2028.”

PPM p.195% confidence

Numeric inconsistency — Series/interest-rate structure (single 8.00% Series A on cover vs A Bonds at 8.00% and Ra Bonds at 8.65% in financials)

High

The cover and summary market a single series of 8.00% Series A Bonds, but the audited financial statements describe a two-series structure (A Bonds and Ra Bonds) paying 8.00% and 8.65% per annum respectively — the higher-rate Ra Bonds are never disclosed in the offering body.

“8.0% Series A Unsecured Bonds (Series A Bonds) ... the Company anticipates making quarterly interest payments to the A and Ra bondholders at a rate of 8.00% and 8.65% per annum, respectively.”

PPM p.188% confidence

Unfilled placeholder text — [●]

Medium

Unfilled bracket placeholder for the Risk Factors page reference on the cover-page disclosure — the page number was never inserted.

“Prospective investors should carefully consider and review that risk as well as the RISK FACTORS beginning on Page [●] of this offering circular.”

PPM p.295% confidence

Unfilled placeholder text — beginning on page of this offering circular

Low

Template page-reference token left blank in the summary Risk Factors caption — the page number that should follow 'beginning on page' was never filled in.

“You should carefully consider the risks above, as well as the other risks described under “ Risk Factors ” beginning on page of this offering circular before making an investment decision.”

PPM p.885% confidence

Spelling / typo — COMMISION

Info

Misspelling of 'COMMISSION' in the bold all-caps SEC legend on the cover-page disclosure.

“THESE SECURITIES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE SEC; HOWEVER, THE COMMISION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.”

PPM p.395% confidence

Spelling / typo — principals of our Sponsor principals of our Sponsor

Info

Doubled phrase ('principals of our Sponsor' repeated) creating a broken sentence in the Sponsor description.

“Combined, principals of our Sponsor principals of our Sponsor have over 130 years of cumulative commercial real estate lending, management and workout experience, with in excess of $30B of funded.”

PPM p.4290% confidence

Diligence gaps

Questions a standard diligence questionnaire would ask that the PPM leaves unanswered.

DDQ gap: Does the fund engage an independent auditor?

High

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.

90% confidence

DDQ gap: Does the fund have a GP clawback provision?

High

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.

90% confidence

DDQ gap: What is the LP/GP carried-interest split above the preferred return?

High

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.

90% confidence

DDQ gap: What is the preferred return (hurdle) rate offered to LPs?

High

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.

90% confidence

DDQ gap: Does the fund use a third-party fund administrator?

Medium

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.

90% confidence

DDQ gap: Is there a GP catch-up, and at what rate?

Medium

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.

90% confidence

DDQ gap: What distribution-waterfall structure does the fund use?

Medium

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.

90% confidence

DDQ gap: What is the GP's capital commitment (skin in the game)?

Medium

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.

90% confidence

DDQ readiness

How much of a standard institutional due-diligence questionnaire this fund's offering documents answer out of the box. Gaps are questions an allocator will ask directly.

38%

Coverage

5 answered0 partial8 gaps13 questions

Economics

What is the preferred return (hurdle) rate offered to LPs?Gap
What is the LP/GP carried-interest split above the preferred return?Gap
Is there a GP catch-up, and at what rate?Gap
Does the fund have a GP clawback provision?Gap
What is the GP's capital commitment (skin in the game)?Gap

Structure

What distribution-waterfall structure does the fund use?Gap
What is the fund's investment strategy / asset class?Debt · UnknownAnswered
What is the fund's vintage year?Vintage 2018.Answered
What is the target offering size?Target offering of $75,000,000.Answered
What is the minimum LP investment?Minimum investment of $10,000.Answered

Fees & Expenses

Is the fund's fee schedule disclosed (management fee, etc.)?7 fee line item(s) extracted from the offering documents.Answered

Governance

Does the fund engage an independent auditor?Gap
Does the fund use a third-party fund administrator?Gap

Generate IC memo →

Fee scheduletaken before LP distributions

Total load 11.75%

Fee

Trigger

Basis

Rate

Selling Commission

Bond sale

5.00% of gross offering proceeds on the sale of Bonds

5.00%

Managing Broker-Dealer Fee

Bond sale

Up to 1.00% of the gross proceeds of the offering

1.00%

Wholesaling Fee

Bond sale through certain selling group members

Up to 1.00% of gross proceeds from certain sales of the Bonds

1.00%

Nonaccountable Expense Reimbursement

Bond sale

1.25% of gross offering proceeds on the sale of Bonds

1.25%

Organization and Offering Fee (O&O Fee)

Offering proceeds received

2.00% of gross offering proceeds; Manager pays actual O&O expenses from this fee and retains any excess; capped at 2.00% of offering proceeds ($1,500,000 at maximum offering amount)

2.00%

Management Fee

Ongoing operations (quarterly)

1.00% per annum of (i) all capital contributions of the Members, net of any amounts invested at that time in loans or debt instruments, plus (ii) the outstanding principal amount of each loan or real estate debt instrument then held, including loans secured by real estate owned as a result of borrower default; calculated quarterly and paid in advance of the applicable quarter

1.00%

Disposition Fee

Loan repayment or real estate disposition

0.50% of proceeds received from the repayment of the principal amount of any debt investments or any other disposition of the underlying real estate

0.50%

Service providers3 gaps

Provider network →

Legal Counsel

Gap

Not disclosed

No independent counsel named for investors. Common in small syndications where Manager and Fund share counsel — reduces independence. Verify during diligence.

Auditor

Gap

Not disclosed

Audit intent not stated in PPM. Ask the sponsor: will the fund be audited, by whom, and on what frequency?

Fund Administrator

Gap

Not disclosed

No third-party fund administrator referenced. Manager likely handles admin internally — common for <$10M raises but reduces independence.

Placement Agent

No placement agent engaged

No placement agent engaged. Direct placement by Manager — no placement fees eat your invested capital.

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Waterfalls Composite Score

41.9.

LP-favorability score · 5 weighted dimensions

Benchmark · Real Estate Equity

Diversified Real Estate

See where this fund sits across 189 indexed diversified real estate funds — median pref, hurdle, splits, GP commit.

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Score breakdown5 dimensions

Absolute LP Takeⓘunscored—

GP Timing Riskⓘ10

Pref Qualityⓘ72

Fee Dragⓘ71

Alignmentⓘ15

LP take × exit multiple

at 5y hold · 97% at 1.75×

LP take Fee drag· sim at $500k equity

Exit	LP IRR	LP MoC	LP Take	Fees
1.00×	-1.1%	0.94×	94.5%	5.5%
1.50×	7.6%	1.44×	96.2%	3.8%
1.75×	11.1%	1.69×	96.6%	3.4%
2.00×	14.2%	1.94×	97.0%	3.0%
2.50×	19.5%	2.44×	97.5%	2.5%
3.00×	24.0%	2.94×	97.8%	2.2%

Jump to an exit

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