Could you please verify your 3.7 project is running on SP4 and .NET 4 and under IIS and it is standard edition? The steps you need to take in order to upgrade your 3.7 solution to SP4 are described in our Documentation. Please complete them and then you can proceed to migrate your solution successfully.
Complete steps necessary to be done to migrate the 3.7 Project to 7.0 can be found here
Do you want to have your say in the Sitefinity development roadmap? Do you want to know when a feature you requested is added or when a bug fixed? Explore the Telerik Sitefinity CMS Ideas&Feedback Portal
and vote to affect the priority of the items