Your tax-default auction closed yesterday at $2,027,600 across 0.92 acres of Old Town Temecula Downtown Core. After surviving-lien priority claims, the LLC's residual §4675 excess-proceeds position lands in the $1.0M–$1.4M range. This term sheet is a structured acquisition of that position, with the §4675 claim filed in your favor by us within fourteen days, the quitclaim chip carved out for parallel monetization, and an ASC 350-30 license tranche delivered to your balance sheet at close.
| APN | Min Bid | Sold For | Surplus |
|---|---|---|---|
| 922-043-002 + 003 | $3,463 | $462,100 | $458,637 |
| 922-043-004 | $1,866 | $800,200 | $798,334 |
| 922-043-023 | $1,876 | $350,200 | $348,324 |
| 922-043-024 | $3,752 | $415,100 | $411,348 |
| TOTAL | $11,007 | $2,027,600 | $2,016,643 |
The §4675 priority cascade then runs against the surplus: cost of sale (~$2K), surviving-lien claims (WRCOG/TWAIN PACE past-due ~$500–650K, RCWD past-due ~$30–50K, surviving mechanics-lien claims ~$50–200K, FTB ~$10–50K), and the LLC as former assessee receives the residual.
Estimated LLC residual after the priority cascade: $1.0M–$1.4M. This is the asset being acquired below.
Both close in escrow within forty-eight hours of countersignature. Pick the structure that fits your fund's cash-versus-recovery profile.
$25K Cash · $500K Notional License · 30% §4675 Participation
Balanced: immediate cash, balance-sheet asset, and meaningful §4675 upside — for an LLC that wants close-out certainty plus continued recovery.
$25,000 cash + $500,000 notional ASC 350 IP license tranche + 30% of net §4675 distribution to the LLC, paid on receipt by us| Cash at signing | $25,000 wired into Stewart Title escrow on countersignature; released to LLC operating account within 48 hours. |
| License tranche | $500,000 notional assigned tranche of the OBCL / ZC Technologies Trust IP License (ASC 350-30 / IRC §197). Delivered with FMV opinion, executed assignment instrument, sublicense covenants. LLC books at $500,000 stipulated acquisition cost. |
| §4675 participation | 30% of Net §4675 Recovery, defined as gross §4675 distribution received less (a) court / TTC filing fees, (b) priority-dispute legal fees, (c) reasonable enforcement carry capped at $25K. Distribution to LLC within 10 business days of receipt by us. |
| Quitclaim revenue | 100% retained by us. Justification: this stream depends entirely on our negotiation with auction winners and our willingness to deploy capital and legal time; the LLC has neither the contact channel nor the operational capacity to monetize this independently. |
| What LLC delivers | (i) Assignment of §3725, §3731, §4675 and related residual rights for all five APNs; (ii) executed Quitclaim Deeds for each APN to escrow; (iii) limited POA for filing the §4675 claim and any related court actions; (iv) cooperation in priority-dispute discovery if requested. |
| Indemnity to LLC | Full §3725 / §3731 / junior-lien defense, $500K aggregate cap, $0 deductible. |
| Mutual release | Customary; excludes fraud and intentional misrepresentation; preserves LLC claims against prior obligor. |
| MFN protection | 30-day Most-Favored Counterparty match-or-release, $5,000 expense reimbursement on release. |
| Tax / accounting pack | FMV opinion, ASC 360-10-40 derecognition + ASC 350-30 acquired-intangible memo, IRC §165(a) substantiation, ASC 450-30 contingent-gain disclosure for §4675 participation. Delivered same day as funding. |
$0 Cash · $750K Notional License · 40% §4675 Participation
For an LLC that prefers a larger acquired-intangible asset and a higher participation share, with no cash at close.
$0 cash · $750,000 notional ASC 350 IP license tranche · 40% of net §4675 distribution to the LLC| Cash at signing | $0. Title-escrow opening fee (~$500) covered by us. |
| License tranche | $750,000 notional assigned tranche of the OBCL / ZC Technologies Trust IP License. Same delivery package as Structure A. LLC books at $750,000 stipulated acquisition cost; ~$45-65K NPV §197 tax shield over 15 years. |
| §4675 participation | 40% of Net §4675 Recovery (same definition as Structure A). Distribution to LLC within 10 business days of receipt. |
| Quitclaim revenue | Same as Structure A: 100% retained by us. |
| What LLC delivers | Same as Structure A. |
| Indemnity / Release / MFN / Tax pack | Same as Structure A across the board. |
Both structures use the same execution sequence. The flow is engineered for fastest realization on both sides:
Net effect: the LLC sees cash + license + balance-sheet relief by day 2. We see the title-cloud monetization within 30 days and §4675 distributions over 6–12 months. Neither side waits on the other; the structure is parallelized, not serial.
Our §4675 claim package — including priority memorandum addressing WRCOG / TWAIN past-due, RCWD assessments, mechanics-lien chain, and FTB position — is drafted. A new entrant must rebuild this from scratch — minimum five business days — before they can even quote terms. We file in your name within fourteen days of recording.
We have visibility into the live auction bidder set across all four APNs and a deliverable counterparty profile for s***a (three-parcel contiguous assemblage, highest urgency for clean title) and s***y (single-parcel corner). The quitclaim revenue path is identified, sequenced, and ready to execute on day 10. A new entrant has no contact, no negotiation history, and no pipeline.
Embedded in both structures: if, within thirty (30) days of countersignature, the LLC produces a written, fully-financed, executable offer from a third party on materially better terms across the same scope, we match those terms or release the LLC from our agreement and reimburse documented expenses up to $5,000. The shopping option does not produce upside; only delay.
Professional excess-proceeds buyers (Mooney Law, Excess Proceeds Recovery, Capitis Asset Management, and others) routinely approach former assessees within 7-14 days of tax-deed recording. Their offers are structured purely as discount-to-claim cash buyouts, typically 30-60 cents on the expected dollar, with no license augmentation, no quitclaim carve-out, and no fast-cash component. Our offer is materially superior on every axis. The LLC's window for the better deal is the next 14 days.
Delivery of the full executable term sheet, FMV opinion, license assignment instrument, and §4675 claim package is conditioned on a one-page NDA with a 48-hour no-shop. Standard reciprocal confidentiality covering all numbers and structure on this page and in delivered drafts.
The LLC retains the §4675 claim and files it directly through its own counsel, bearing legal cost and priority-dispute risk. The quitclaim chip remains with the LLC but without our buyer pipeline, the LLC must independently identify, negotiate with, and close the auction winners on its own. Surviving-lien defense remains the LLC's responsibility. Our offer is not contingent on the LLC's cooperation; it is the cleanest path available before the 14-day post-recording window closes.
Reply with: (i) the LLC manager's name and direct contact, (ii) counsel of record, (iii) preferred structure (A or B), and (iv) any term you wish to negotiate. Within four business hours we deliver: full term sheet for the structure you choose, full closing document set in draft, FMV opinion, §4675 claim draft, and an introduction to the title escrow officer.
Subject: Temecula 922-043 — §4675 Resolution — Structure Selection
Respectfully tendered for the LLC's review and counter-proposal.