MCI Income Fund VII, LLC

Cascade · Distributions

Where each dollar goes

$875K

LP $875K · Fees $0 · GP $0

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

Class structure · 2 classes· viewing as Class B Bonds

How MCI Income Fund VII, LLC divides the cap table

The cascade above is filtered to Class B Bonds. Reset to blended view.

Class A Bonds
senior secured debt
Min · $10K
“7.00% Senior Secured Bonds (Class A Bonds)”— PPM p. 1
Class B Bonds● active
senior secured debt
Min · $10K
“7.50% Senior Secured Bonds (Class B Bonds)”— PPM p. 1

Deal diligence16 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.

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.

Document-quality defect — Closing-date schedule (every Friday vs. the 20th of each month)

Medium

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.

“Our Company will conduct closings in this offering on every Friday (except bank holidays) or the 'closing dates,' ... We will conduct closings on the 20th of each month or, if the 20th is not a business day, the next succeeding business day, assuming there are funds to close, until the offering termination.”

PPM p.585% confidence

Broken cross-reference — Cover fee-table footnotes (6) and (7)

Low

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.

“(6) The table above shows amounts payable to our managing broker-dealer if we sell half of the maximum offering amount comprised solely of Class A Bonds. (7) The table above shows amounts payable to our managing broker-dealer if we sell half of the maximum offering amount comprised solely of Class B Bonds.”

PPM p.382% confidence

Broken cross-reference — MIC PIFIV (in the MCI PIFV-A track-record paragraph)

Low

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.

“MCI PIFV-A commenced an offering of up to $50 million of preferred equity membership interests pursuant to a private placement memorandum on September 1, 2022. The offering for MIC PIFIV is ongoing.”

PPM p.6988% confidence

Defined-term defect — MCI VII (for MCI Preferred Income Fund VI, LLC)

Low

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.

“MCI Preferred Income Fund V-A, LLC, or MCI V-A, and MCI Preferred Income Fund VI, LLC, or MCI VII.”

PPM p.6990% confidence

Document-quality defect — September 31, 2022

Low

Financial-statement note states the Company's term is indefinite 'as of September 31, 2022' — a logically impossible date, since September has only 30 days.

“The Company's term is indefinite as of September 31, 2022.”

PPM p.7596% confidence

Spelling / typo — from the which applies only to redemption

Info

Broken 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.

“The limit applies only to redemption upon death or disability and is a separate limit from the which applies only to redemption at the option of the Bondholder outside the Redemption Period or Renewed Redemption Period.”

PPM p.1090% confidence

Spelling / typo — the Company incurred did not have any sales

Info

Financial-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.

“For the period of August 26, 2022 (inception) to September 30, 2022, the Company incurred did not have any sales of properties charged to cost of sales, did not incur any SG&A costs for completed properties, or incur any operating or other related expenses.”

PPM p.8091% confidence

Spelling / typo — the Manage shall determine

Info

The 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.

“The LLC Agreement authorizes the Manager to appoint officers of the Company from time to time and give them such duties and responsibilities as the Manage shall determine.”

PPM p.4993% 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 2015.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.)?6 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 11.00%

Fee

Trigger

Basis

Rate

Nonaccountable Expense Reimbursement

Bond sale closing

Up to 1.00% of gross offering proceeds on sale of Class A Bonds; up to 1.00% may also apply on Class B Bond sales

1.00%

Selling Commission

Bond sale closing

6.00% of gross offering proceeds on sale of Class A Bonds; 0% on Class B Bonds

6.00%

Managing Broker-Dealer Fee

Bond sale closing

Up to 0.50% of gross offering proceeds on sale of Class A Bonds

0.50%

Wholesaling Fee

Bond sale through certain selling group members

Up to 1.50% of gross proceeds from certain sales of the Bonds

1.50%

Organization and Offering Fee (O&O Fee)

Bond offering proceeds received

2.00% of gross offering proceeds; Manager retains any excess over actual org/offering expenses as compensation

2.00%

Accountable Expense Reimbursement

Ongoing operations

Documented expenses incurred by Manager and affiliates on behalf of the Company; reimbursed monthly; amount indeterminable

0.00%

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

45.0.

LP-favorability score · 5 weighted dimensions

Benchmark · Real Estate Equity

Diversified Real Estate

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Score breakdown5 dimensions

Absolute LP Takeⓘunscored—

GP Timing Riskⓘ25

Pref Qualityⓘ35

Fee Dragⓘ100

Alignmentⓘ20

LP take × exit multiple

at 5y hold · 100% at 1.75×

LP take Fee drag· sim at $500k equity

Exit	LP IRR	LP MoC	LP Take	Fees
1.00×	0.0%	1.00×	100.0%	0.0%
1.50×	8.4%	1.50×	100.0%	0.0%
1.75×	11.8%	1.75×	100.0%	0.0%
2.00×	14.9%	2.00×	100.0%	0.0%
2.50×	20.1%	2.50×	100.0%	0.0%
3.00×	24.6%	3.00×	100.0%	0.0%

Jump to an exit

1.0× downside 1.5× base 2.0× upside 3.0× home run

MCI Income Fund VII, LLC

Class A Bonds

Class B Bonds● active

Document quality

Document-quality defect — Closing-date schedule (every Friday vs. the 20th of each month)

Broken cross-reference — Cover fee-table footnotes (6) and (7)

Broken cross-reference — MIC PIFIV (in the MCI PIFV-A track-record paragraph)

Defined-term defect — MCI VII (for MCI Preferred Income Fund VI, LLC)

Document-quality defect — September 31, 2022

Spelling / typo — from the which applies only to redemption

Spelling / typo — the Company incurred did not have any sales

Spelling / typo — the Manage shall determine

Diligence gaps

DDQ gap: Does the fund engage an independent auditor?

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

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

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

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

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

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

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

DDQ readiness

Fee scheduletaken before LP distributions

Community threads0 active

Reviews