Contract analysis

ARTICLE I — DEFINITIONS As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined in this Article I shall have the meanings ascribed to them elsewhere in this Agreement.

Section 1.1 — "Agreement." "Agreement" means this Settlement Standstill Agreement, including all exhibits attached hereto and all amendments, supplements, or modifications hereto made in accordance with Section 7.5.

Section 1.2 — "Parties." "Parties" means, collectively, Petitioner and Contestants. "Party" means any one of them individually.

Section 1.3 — "Petitioner." "Petitioner" means Marguerite D. Fonseca, an individual residing at 1847 Coldwater Canyon Drive, Beverly Hills, California 90210, the surviving spouse of the Decedent and the petitioner in the Proceeding.

Section 1.4 — "Contestants." "Contestants" means, collectively, (a) Rafael T. Fonseca, an individual residing at 502 Olive Avenue, Unit 3, Burbank, California 91502; (b) Isabela C. Fonseca-Greer, an individual residing at 78 Eucalyptus Lane, Santa Monica, California 90402; and (c) Nicolás R. Fonseca, an individual residing at 1190 Elm Street, Apt. 4B, Palo Alto, California 94301, each an adult child of the Decedent f

Section 1.5 — "Court." "Court" means the Los Angeles County Superior Court, Probate Division, or any successor court having jurisdiction over the Proceeding.

Section 1.6 — "Proceeding." "Proceeding" means Case No. 22STPB09714, In re Estate of Teodoro R. Fonseca, Deceased, pending in the Court, together with any and all motions, petitions, objections, claims, counterclaims, cross-petitions, and other matters filed or pending therein.

Section 1.7 — "Estate." "Estate" means the probate estate of Teodoro R. Fonseca, Deceased, including all assets, rights, interests, claims, and obligations comprising the probate estate, as more particularly described in Exhibit A hereto.

Section 1.8 — "Neutral Administrator." "Neutral Administrator" means Ashford Fiduciary Services Inc., a California corporation, with its principal office at 600 Wilshire Boulevard, Suite 1450, Los Angeles, California 90017, Gerald Whitmore serving as Principal Officer, appointed by the Court as the neutral administrator of the Estate pursuant to the Stipulation for Appointment of Neutral Administrator filed March 22,

Section 1.9 — "Mediator." "Mediator" means the Honorable Constance Adler (Ret.), serving through the Westside Dispute Resolution Center, located at 11400 West Olympic Boulevard, Suite 550, Los Angeles, California 90064.

Section 1.10 — "Standstill Period." "Standstill Period" means the period commencing on the Effective Date and ending on the Expiration Date, as such Expiration Date may be extended pursuant to Article V of this Agreement.

Section 1.11 — "Effective Date." "Effective Date" means April 28, 2023, which is the date on which this Agreement becomes effective upon execution by all Parties.

Section 1.12 — "Initial Expiration Date." "Initial Expiration Date" means October 28, 2023, which is six (6) calendar months from the Effective Date. References to the "Expiration Date" shall mean the Initial Expiration Date or, if this Agreement has been renewed pursuant to Section 5.2, the then-applicable expiration date following such renewal.

Section 1.13 — "Settlement Discussions." "Settlement Discussions" means any and all communications, whether oral, written, or electronic, between or among the Parties, their respective counsel, the Mediator, or any other person participating in settlement negotiations at the direction of the Parties, relating to the potential resolution, compromise, or settlement of the Proceeding or any claims, disputes, or issues a

Section 1.14 — "Petitioner's Counsel." "Petitioner's Counsel" means Calderwood & Harkness LLP, with offices at 350 South Grand Avenue, Suite 4800, Los Angeles, California 90071, Howard Quinn, Esq. serving as the Responsible Partner.

Section 1.15 — "Contestants' Counsel." "Contestants' Counsel" means Brennan, Ortega & Saldívar LLP, with offices at 1900 Avenue of the Stars, Suite 2100, Los Angeles, California 90067, Damian R. Ortega, Esq. serving as the Lead Attorney.

ARTICLE II — TOLLING OF LITIGATION DEADLINES AND STANDSTILL OBLIGATIONS

Section 2.1 — Tolling of Deadlines. Effective as of the Effective Date and continuing for the duration of the Standstill Period, all litigation deadlines in the Proceeding shall be tolled. The deadlines subject to tolling under this Section include, but are not limited to, deadlines for filing responsive pleadings, motions, amended pleadings, petitions, objections, and other papers; deadlines for propounding and resp

Section 2.2 — Prohibition on New Filings. During the Standstill Period, no Party shall file any new motion, petition, objection, amended pleading, cross-petition, claim, or other pleading or paper in the Proceeding without the prior written consent of all other Parties, except as expressly permitted under Section 2.4 of this Agreement. Any filing made in violation of this Section 2.2 shall be deemed a breach of this

Section 2.3 — Prohibition on discovery. During the Standstill Period, no Party shall serve, propound, or issue any discovery in connection with the Proceeding without the prior written consent of all other Parties. The prohibition set forth in this Section 2.3 extends to, but is not limited to, interrogatories, requests for production of documents, requests for admission, deposition notices (whether for oral or writt

Section 2.4 — Permitted Actions. Notwithstanding the prohibitions set forth in Sections 2.2 and 2.3 of this Agreement, the following actions are expressly permitted during the Standstill Period without the prior consent of any other Party: (a) Filings that are required to preserve jurisdictional or statutory rights of any Party that cannot be tolled by private agreement of the Parties, including but not limited to an

Section 2.5 — Preservation of Claims and Defenses. Nothing in this Agreement shall be construed as a waiver, release, abandonment, or prejudice of any claim, defense, right, or remedy of any Party in the Proceeding or otherwise. All claims, defenses, rights, and remedies of the Parties as of the Effective Date are expressly reserved and preserved in full, including but not limited to all claims and defenses identifie

Section 2.6 — Statute of Limitations. The Parties agree that any statute of limitations, statute of repose, prescriptive period, or other time-based legal defense or time bar applicable to any claim asserted or that could be asserted in the Proceeding, or arising out of or relating to the same facts, circumstances, transactions, or occurrences at issue in the Proceeding, shall be tolled for the duration of the Stands

ARTICLE III — CONTINUED NEUTRAL ADMINISTRATION OF THE ESTATE

Section 3.1 — Continuation of Neutral Administrator. Ashford Fiduciary Services Inc. shall continue to serve as the Neutral Administrator of the Estate during the Standstill Period, in accordance with the terms and conditions of the Stipulation for Appointment of Neutral Administrator filed with the Court on March 22, 2023, the Court's order approving such appointment entered on March 24, 2023, and any supplemental c

Section 3.2 — Scope of Administration. During the Standstill Period, the Neutral Administrator shall exercise its fiduciary duties in a prudent and commercially reasonable manner and shall, at a minimum, perform the following functions: (a) Maintenance and Preservation of Estate Assets. Maintain, preserve, protect, and safeguard all Estate assets, including but not limited to: (i) Real property located at 1847 Coldwa

Section 3.3 — Restrictions on the Neutral Administrator. During the Standstill Period, the Neutral Administrator shall not, without the prior written consent of all Parties or further order of the Court, take any of the following actions: (a) Sell, transfer, convey, assign, exchange, encumber, pledge, hypothecate, lease (other than short-term leases of ninety (90) days or less on terms consistent with prior practice)

Section 3.4 — Administration Fees and Costs. The Neutral Administrator shall be compensated for its services at the rate of Eight Thousand Five Hundred Dollars ($8,500) per month, plus fifteen one-hundredths of one percent (0.15%) of assets under administration per annum (the "AUA Fee"), as set forth in the Stipulation for Appointment of Neutral Administrator. Such fees and costs shall be allocated and paid as follow

Section 3.5 — Failure to Pay Administration Fees. If either Petitioner or Contestants (treated as a group for purposes of this Section) fails to timely pay its share of the Neutral Administrator's monthly fees for two (2) consecutive months, the non-defaulting Party shall have the following remedies, exercisable in its sole discretion: (a) Advancement. The non-defaulting Party may advance the defaulting Party's share

Section 4.1 — Confidentiality of Settlement Discussions. All Settlement Discussions between or among the Parties, their respective counsel, the Mediator, or any other person participating in settlement negotiations at the direction of the Parties, whether occurring before, on, or after the Effective Date and during the Standstill Period, shall be and remain strictly confidential. No Party shall disclose, publish, dis

Section 4.2 — Inadmissibility. All Settlement Discussions, and all documents, communications, proposals, counterproposals, memoranda, position statements, term sheets, draft agreements, and other materials prepared or exchanged in connection with Settlement Discussions, shall be inadmissible in any judicial, arbitral, administrative, or other proceeding, whether pending or future, for any purpose, including but not l

Section 4.3 — Confidential Information. All financial information, valuation data, appraisal reports, business records, tax returns, operating statements, balance sheets, membership interest agreements, intellectual property schedules, and other non-public information exchanged between or among the Parties or their counsel in connection with Settlement Discussions, the mediation process, or this Agreement (collective

Section 4.4 — Court Filings. The Parties shall not file this Agreement, any amendment hereto, or any exhibit or attachment hereto with the Court or any other tribunal without the prior written consent of all Parties, except where such filing is required by court order, applicable statute, or applicable rule of court. In the event that filing is required, the filing Party shall first confer with all other Parties rega

Section 4.5 — Survival. The confidentiality obligations set forth in this Article IV, including without limitation the obligations set forth in Sections 4.1, 4.2, 4.3, and 4.4, shall survive the termination, expiration, or breach of this Agreement and shall remain in full force and effect indefinitely, unless modified or waived by written agreement of all Parties.

ARTICLE V — TERM, RENEWAL, AND TERMINATION

Section 5.1 — Initial Term. This Agreement shall commence on the Effective Date, April 28, 2023, and shall continue in full force and effect until the Initial Expiration Date, October 28, 2023, unless earlier terminated in accordance with this Article V or renewed in accordance with Section 5.2.

Section 5.2 — Renewal. This Agreement may be renewed for successive periods of six (6) calendar months each (each a "Renewal Period") by mutual written consent of all Parties. The written consent to renew must be executed by all Parties, or by their authorized counsel on their behalf, not later than five (5) business days prior to the then-applicable Expiration Date. Each renewal shall be documented by a written amen

Section 5.3 — Termination by Mutual Consent. This Agreement may be terminated at any time, including prior to the Expiration Date, by written agreement of all Parties. Such written agreement shall specify the effective date of termination and shall address any transitional matters, including the recommencement of tolled deadlines and the continued role of the Neutral Administrator.

Section 5.4 — Termination by Unilateral Notice. Any Party may terminate this Agreement upon thirty (30) days' prior written notice to all other Parties and their counsel, delivered in accordance with Section 7.3 of this Agreement. Following delivery of such notice, the Standstill Period shall continue in full force and effect for the thirty (30)-day notice period, and all obligations of the Parties under this Agreeme

Section 5.5 — Effect of Termination or Expiration. Upon the termination or expiration of this Agreement, whether by mutual consent, unilateral notice, lapse of the Standstill Period, or otherwise, the following provisions shall apply: (a) Recommencement of Deadlines. All litigation deadlines tolled pursuant to Section 2.1 shall recommence with the same number of days remaining as existed on the Effective Date, calcul

ARTICLE VI — REPRESENTATIONS AND ACKNOWLEDGMENTS

Section 6.1 — Authority. Each Party represents and warrants that he or she has the full legal capacity and authority to enter into this Agreement and to perform his or her obligations hereunder. Each Party further represents that no consent, approval, or authorization of any third party is required in connection with the execution, delivery, or performance of this Agreement by such Party, other than any court approva

Section 6.2 — Voluntary Execution. Each Party acknowledges and represents that this Agreement is entered into voluntarily, freely, and without duress, coercion, fraud, mistake, or undue influence of any kind. Each Party has had a reasonable opportunity to review and consider the terms of this Agreement before executing it, and each Party is satisfied with the terms and provisions hereof.

Section 6.3 — Advice of Counsel. Each Party acknowledges that he or she has been advised by independent legal counsel regarding the terms, consequences, and legal effect of this Agreement, and that each Party has had the full benefit of such counsel's advice prior to executing this Agreement. Petitioner has been advised by Calderwood & Harkness LLP, through Howard Quinn, Esq. Contestants have been advised by Brennan,

Section 6.4 — No Admission. This Agreement, the Parties' entry into this Agreement, and the Parties' performance under this Agreement shall not be construed as, and do not constitute, an admission of liability, fault, wrongdoing, or the validity or invalidity of any claim or defense by any Party. This Agreement is entered into solely for the purpose of promoting settlement and preserving the status quo during settlem

Section 6.5 — Preservation of Estate. Each Party represents and warrants that, as of the Effective Date, he or she is not aware of any circumstances constituting an imminent threat of dissipation, waste, destruction, or loss to any Estate assets. Each Party further agrees to promptly notify all other Parties and the Neutral Administrator in writing if, during the Standstill Period, such Party becomes aware of any suc

ARTICLE VII — GENERAL PROVISIONS

Section 7.1 — Governing Law. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of California, including without limitation the California Probate Code and the California Evidence Code, without regard to California's conflict of laws principles or choice of law rules that would require or permit the application of the laws of any other jurisdiction.

Section 7.2 — Jurisdiction and Venue. The Parties irrevocably consent to the exclusive jurisdiction and venue of the Los Angeles County Superior Court, Probate Division, in connection with Case No. 22STPB09714, for the resolution of any dispute arising out of or relating to this Agreement, including but not limited to any dispute concerning the interpretation, enforcement, breach, or validity of this Agreement. Each

Section 7.3 — Notices. All notices, requests, demands, consents, waivers, and other communications required or permitted under this Agreement shall be in writing and shall be deemed effectively delivered and received: (a) upon personal delivery to the addressee or its authorized agent; (b) one (1) business day after deposit with a nationally recognized overnight courier service (such as Sundial Data Systems or Harbor

Section 7.4 — Entire Agreement. This Agreement, together with all exhibits attached hereto and any written amendments hereto made in accordance with Section 7.5, constitutes the entire agreement between and among the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous oral or written agreements, understandings, negotiations, representations, warranties, and communications re

Section 7.5 — Amendments. This Agreement may be amended, modified, or supplemented only by a written instrument specifically identified as an amendment to this Agreement and signed by all Parties or by their authorized counsel acting on their behalf. No oral modification, amendment, or waiver of any provision of this Agreement shall be effective for any purpose.

Section 7.6 — Waiver. No waiver of any term, condition, or provision of this Agreement shall be effective unless made in writing and signed by the Party against whom the waiver is sought to be enforced. No failure or delay by any Party in exercising any right, power, or remedy under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power, or remedy preclude any o

Section 7.7 — Severability. If any provision of this Agreement, or the application thereof to any person, Party, or circumstance, is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired, and such remaining provisions shall continue in full force and effec

Section 7.8 — Counterparts. This Agreement may be executed in any number of counterparts, including by electronic transmission (including PDF, Brightwater Software, or similar electronic signature platform), each of which shall be deemed an original, and all of which, when taken together, shall constitute one and the same instrument. Electronic or facsimile signatures shall be deemed original signatures for all purpo

Section 7.9 — Binding Effect. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective heirs, executors, administrators, personal representatives, successors, and assigns. No Party may assign or transfer this Agreement or any rights or obligations hereunder without the prior written consent of all other Parties.

Section 7.10 — Construction. This Agreement has been jointly drafted and negotiated by the Parties and their respective counsel. The language of this Agreement shall be construed as a whole, according to its fair meaning, and not strictly for or against any Party as the drafter. Each Party acknowledges that it has participated in the drafting of this Agreement and that no ambiguity shall be construed against any Part

Section 7.11 — Headings. The article and section headings contained in this Agreement are for convenience of reference only and shall not affect the meaning, interpretation, or construction of any provision of this Agreement. [SIGNATURE PAGE FOLLOWS] SIGNATURE PAGE TO SETTLEMENT STANDSTILL AGREEMENT IN RE ESTATE OF TEODORO R. FONSECA, DECEASED Case No. 22STPB09714 IN WITNESS WHEREOF, the Parties have executed this Se

1. Petitioner's Petition for Letters of Administration Filed: October 5, 2022. Marguerite D. Fonseca, the surviving spouse of the Decedent, seeks appointment as administrator of the Estate pursuant to California Probate Code Section 8461 and related provisions. Petitioner asserts priority of appointment as the surviving spouse of the Decedent and contends that she is the appropriate person to serve as administrator o