United States securities and exchange commission logo
July 15, 2020
Chris Christensen
Chief Executive Officer
iCap Vault 1, LLC
3535 Factoria Blvd. SE, Suite 500
Bellevue, WA 98006
Re: iCap Vault 1, LLC
Amendment No. 3 to
Registration Statement on Form S-11
Filed June 30, 2020
File No. 333-236458
Dear Mr. Christensen:
We have reviewed your amended registration statement and have the
following
comments. In some of our comments, we may ask you to provide us with
information so we
may better understand your disclosure.
Please respond to this letter by amending your registration
statement and providing the
requested information. If you do not believe our comments apply to your
facts and
circumstances or do not believe an amendment is appropriate, please tell
us why in your
response.
After reviewing any amendment to your registration statement and
the information you
provide in response to these comments, we may have additional comments.
Unless we note
otherwise, our references to prior comments are to comments in our May
28, 2020 letter.
Amendment No. 3 to Registration Statement on Form S-11 filed June 30,
2020
General
1. We note your response
to comment 1 and your revised disclosure on page 53. In this
regard we note that you
"reserve the right to suspend, terminate, modify, or add to the
Interest Premium
Program or offers thereunder or any Interest Rate Premiums at any time
. . . and [you] are not
required to implement any or all of the offers outlined above." It
appears to us that
investors need ongoing transparency regarding the pricing terms of the
security. Therefore, it
does not appear to us that your pricing structure on the notes
complies with Item
202(b)(1) of Regulation S-K and Item 501(b)(3) of Regulation S-K.
Please revise your
pricing structure as appropriate. We may have further comment.
Chris Christensen
FirstName
iCap Vault LastNameChris Christensen
1, LLC
Comapany
July NameiCap Vault 1, LLC
15, 2020
July 15,
Page 2 2020 Page 2
FirstName LastName
2. We note that the "Floating Rate payable on the Notes will accrue based
on a 365-day year,
compounds daily and will be credited to your Notes on the last
business day of each
calendar month and will be reinvested." Please tell us whether the
reinvested interest will
be conducted as a part of this registered offering or whether it will
be exempt from
registration. If you are registering the interest reinvestment then
revise the registration
statement as appropriate. If you are relying on an exemption, please
tell us the exemption
and provide an analysis as to the availability of the exemption. In
this regard, please tell
us how you intend to inform investors of the interest rate at the time
of the reinvestment.
We may have further comment.
3. Please explain to us how you determined to market and sell the Demand
Notes as Senior
Secured Demand Notes when it appears that the Notes will be
subordinated to all
existing and future obligations of your subsidiaries. We also note the
disclosure on page
36 that the Notes and guarantee are secured by a second-priority lien
in the membership
interests in Vault Holding 1, LLC.
4. We note your response to our prior Comment 3. If the offer is being
made pursuant to
objectively determinable offer conditions, as the disclosure on
pages 43 and 44 now
suggests, please disclose what those conditions are. Please note that
our prior Comment 3
was intended to convey the Staff s view that an unfettered right to
terminate the offer may
have constituted an illusory tender offer in contravention of Section
14(e). Given that the
exchange offer component of the contemplated offering has been
removed, the concern
regarding an illusory tender offer is no longer present. However, the
insertion of the
references to objectively determinable offer conditions now
renders the disclosure
unclear.
5. Please advise us as to whether an Intercreditor Agreement has been
drafted or entered into
already, and if not, the expected timing of such drafting and
adoption. If the Intercreditor
Agreement has been entered into, please file it as an exhibit.
Notes to Unaudited Condensed Consolidated Financial Statements
Note 1. Nature of Business and Summary of Significant Accounting Policies, page
F-16
6. We note your response to our prior comment 8. We further note your
disclosure that there
has been no activity in Vault Holding 1, LLC since its inception.
Please confirm for us
and revise your filing to disclose, if true, that Vault Holding 1, LLC
has not commenced
operations and has no (or nominal) assets and liabilities. To the
extent this disclosure is
not true, we may have further comment.
Chris Christensen
iCap Vault 1, LLC
July 15, 2020
Page 3
You may contact Isaac Esquivel at 202-551-3395 or Jennifer Monick at
202-551-3295 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Jonathan Burr at 202-551-5833 or David Link at 202-551-3356 with any
other
questions.
Sincerely,
FirstName LastNameChris Christensen
Division of
Corporation Finance
Comapany NameiCap Vault 1, LLC
Office of Real Estate
& Construction
July 15, 2020 Page 3
cc: Laura Anthony
FirstName LastName