MCI Income Fund VII, 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
  Document-quality defect — Closing-date schedule (every Friday vs. the 20th of each month)The closing schedule is stated two contradictory ways: the Offering Circular Summary and the How to Invest section say closings occur 'on every Friday (except bank holidays),' while the Plan of Distribution says closings occur 'on the 20th of each month' — investors cannot tell when closings actually happen.
• low
  Broken cross-reference — Cover fee-table footnotes (6) and (7)Footnotes (6) and (7) to the cover-page price table describe amounts payable 'if we sell half of the maximum offering amount' rows, but the cover table contains only four rows (per-bond and full-maximum for each class) with footnote callouts (1) through (5) — there is no half-of-maximum row for footnotes (6) and (7) to annotate.
• low
  Broken cross-reference — MIC PIFIV (in the MCI PIFV-A track-record paragraph)The track-record paragraph describing the MCI PIFV-A offering closes by stating 'The offering for MIC PIFIV is ongoing' — pointing to the wrong fund (PIFIV, described in an earlier paragraph) instead of PIFV-A, a copy-paste carryover error.
• low
  Defined-term defect — MCI VII (for MCI Preferred Income Fund VI, LLC)In the Sponsor track record, MCI Preferred Income Fund VI, LLC is assigned the short-form defined term 'MCI VII' — the wrong roman numeral (and the same numeral as the issuer itself, MCI Income Fund VII), creating ambiguity about which fund is which.
• low
  Document-quality defect — September 31, 2022Financial-statement note states the Company's term is indefinite 'as of September 31, 2022' — a logically impossible date, since September has only 30 days.
• info
  Spelling / typo — from the which applies only to redemptionBroken sentence describing the death/disability redemption limit: 'is a separate limit from the which applies only to redemption' — a word is missing after 'the,' rendering the clause ungrammatical. The same garbled phrasing recurs in the Description of Bonds section.
• info
  Spelling / typo — the Company incurred did not have any salesFinancial-statement note for the Developer contains a broken/doubled clause: 'the Company incurred did not have any sales of properties charged to cost of sales' — the stray 'incurred' breaks the sentence.
• info
  Spelling / typo — the Manage shall determineThe LLC Agreement summary contains the misspelling 'as the Manage shall determine' — 'Manage' should read 'Manager,' the document's key defined term for the controlling party.

DDQ readiness — 38% covered

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