letter-ashford-scope-administration.docx

1035-00005 · Marguerite Delp · Correspondence/External

letter-ashford-scope-administration.docx DOCUMENT M&A / Corporate

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CALDERWOOD & HARKNESS LLP Attorneys at Law 350 South Grand Avenue, Suite 4800 Los Angeles, California 90071 Telephone: (213) 555-7200 Facsimile: (213) 555-7201

March 25, 2023

Via Email and First Class Mail

Gerald Whitmore, Principal Officer Ashford Fiduciary Services Inc. 600 Wilshire Boulevard, Suite 1450 Los Angeles, CA 90017

Re: In re Estate of Teodoro R. Fonseca, Deceased Los Angeles County Superior Court, Case No. 22STPB09714 Appointment as Neutral Estate Administrator Calderwood & Harkness LLP Matter No. 1035-00005

Dear Mr. Whitmore:

I. Purpose and Context of This Letter

This letter confirms the terms and scope of Ashford Fiduciary Services Inc.'s ("Ashford") appointment as neutral administrator of the Estate of Teodoro R. Fonseca (the "Estate"), pursuant to the Stipulation for Appointment of Neutral Administrator filed with the Los Angeles County Superior Court on March 22, 2023, and entered by the Court in the above-referenced probate proceeding (the "Stipulation"). A copy of the Stipulation is enclosed for your reference.

As you are aware, this firm, Calderwood & Harkness LLP, represents Marguerite D. Fonseca, the surviving spouse and petitioner in this proceeding. The contestants in this matter are Rafael T. Fonseca, Isabela C. Fonseca-Greer, and Nicolás R. Fonseca (collectively, the "Contestants"), who are represented by Brennan, Ortega & Saldívar LLP (Damian R. Ortega, lead counsel), with offices at 1900 Avenue of the Stars, Suite 2100, Los Angeles, CA 90067. A copy of this letter is being provided simultaneously to Mr. Ortega for the sake of full transparency and to ensure that all parties operate with a shared understanding of the terms and expectations governing Ashford's administration.

The purpose of this letter is to set forth in detail the scope of Ashford's administrative duties, the fee arrangement and cost-sharing structure, the quarterly reporting requirements, and certain additional matters pertinent to the administration of the Estate. We ask that you review the contents carefully, and, as set forth in Section IX below, confirm your agreement in writing at your earliest convenience so that administration may commence without delay.

II. Background on the Estate

By way of background, Teodoro R. Fonseca passed away on September 3, 2022, without a will (intestate). Ms. Fonseca, as the surviving spouse, filed a Petition for Letters of Administration with the Los Angeles County Superior Court on October 5, 2022, seeking appointment as administrator of the Estate. The Contestants filed an initial objection to the petition on November 14, 2022, challenging certain aspects of Ms. Fonseca's proposed administration, and subsequently filed an amended objection on January 9, 2023, raising additional grounds and asserting various claims against the Estate.

In an effort to resolve the dispute and preserve the value of the Estate during the pendency of the contested proceeding, the Court, on March 10, 2023, ordered a stipulated mediation. The first mediation session has been scheduled before the Honorable Constance Adler (Ret.) of the Westside Dispute Resolution Center, and is currently set for April 12, 2023. Given the nature and complexity of the Estate's assets—which include significant real property holdings, business interests, financial accounts, and intellectual property—the parties recognized the need for a professional, neutral administrator to preserve and manage those assets while the underlying dispute is pending. To that end, the parties stipulated to the appointment of Ashford as a neutral administrator, and the Court so ordered on March 22, 2023.

Ashford's appointment is intended to ensure that the Estate's assets are safeguarded, properly maintained, and accounted for during the pendency of the litigation and mediation process, without prejudice to the interests or positions of either side.

III. Identification of Estate Assets Under Administration

The following assets constitute the probate estate and fall within the scope of Ashford's administration. This summary is based on the Preliminary Estate Asset Summary prepared by our firm (a copy of which is enclosed), as supplemented by preliminary appraisals and account records obtained to date.

A. Real Property

The Estate includes two parcels of real property located in Los Angeles County:

1. Beverly Hills Residence: 1847 Coldwater Canyon Drive, Beverly Hills, CA 90210. This property serves as the primary family residence. The estimated fair market value of this property is $8,450,000, based on a preliminary appraisal conducted by Pinnacle West Appraisal Group LLC dated February 10, 2023.

2. Malibu Beach House: 27100 Pacific Coast Highway, Malibu, CA 90265. This property is a secondary residence. The estimated fair market value of this property is $6,200,000, also based on a preliminary appraisal by Pinnacle West Appraisal Group LLC dated February 10, 2023.

Title records for both properties are currently held by Coastline Title & Escrow Co. The primary contact at Coastline is Andrea Solis, whose office is located at 9401 Wilshire Boulevard, Suite 720, Beverly Hills, CA 90212. Ms. Solis has been advised of Ashford's appointment and is prepared to coordinate with you regarding title matters.

B. Business Interests

The decedent held membership interests in two California limited liability companies, each of which represents a substantial component of the Estate:

1. Lumiére Canyon Studios LLC. The decedent held a fifty percent (50%) membership interest in Lumiére Canyon Studios LLC, a California limited liability company (California Secretary of State Filing No. 200906410337). The principal office of Lumiére Canyon Studios LLC is located at 4200 West Olive Avenue, Burbank, CA 91505. Based on an enterprise value of approximately $31,600,000 as of December 31, 2021, the estimated value of the decedent's 50% membership interest is approximately $15,800,000. We note that this valuation is preliminary and subject to adjustment upon completion of formal appraisals.

2. Pacific Rim Narrative Partners LLC. The decedent held a thirty-five percent (35%) membership interest in Pacific Rim Narrative Partners LLC, a California limited liability company (California Secretary of State Filing No. 201518720492). The managing member of Pacific Rim Narrative Partners LLC is Victor Sandoval, whose office is located at 8455 Beverly Boulevard, Suite 310, Los Angeles, CA 90048. Based on approximately $78,500,000 in assets under management, the estimated value of the decedent's 35% membership interest is approximately $27,475,000. This valuation is likewise preliminary and subject to further refinement.

As discussed further in Section IV below, Ashford's role with respect to these business interests is limited to monitoring and preserving the decedent's membership interests, and does not extend to active management of either entity's operations.

C. Financial Accounts at Veltara Basin Bank, N.A.

The decedent maintained the following financial accounts at Veltara Basin Bank, N.A., all of which are included in the probate estate:

1. Brokerage Account (Account No. ending in -4782): Approximate balance as of the date of death (September 3, 2022): $5,120,000.

2. Personal Checking Account (Account No. ending in -3091): Approximate balance as of the date of death: $342,000.

3. Money Market Account (Account No. ending in -6155): Approximate balance as of the date of death: $1,875,000.

The Estate's designated relationship manager at Veltara Basin Bank, N.A. is Franklin Ybarra, located at 700 South Hope Street, Los Angeles, CA 90017. Mr. Ybarra has been notified of Ashford's appointment and is prepared to work with you in facilitating account access and reporting. We ask that you coordinate directly with Mr. Ybarra regarding account signatories, account freezes, and any necessary documentation to reflect Ashford's authority over these accounts.

D. Intellectual Property Portfolio

The decedent was a producer and held royalty streams and residuals from fourteen (14) feature films and six (6) television series. The net present value of these royalty streams is estimated at approximately $4,600,000, based on a preliminary analysis conducted by Pinnacle West Appraisal Group LLC. A detailed schedule of the underlying intellectual property interests, including the applicable guilds, distributors, and collection agents, will be provided to Ashford under separate cover once the Estate inventory is finalized in coordination with Ridgeway Accounting Partners LLP.

E. Personal Property

The Estate also includes tangible personal property consisting of art, vehicles, and household furnishings, collectively estimated at approximately $1,250,000. A detailed inventory of these items is currently being compiled and will be made available to Ashford in due course.

F. Aggregate Probate Estate Estimate

Based on the foregoing, the total estimated probate estate is approximately $71,112,000 per our client's calculation. We note that the Contestants, through their counsel, have advanced an alternative aggregate estimate of approximately $68,750,000, reflecting certain differences in their preliminary valuations of the business interests and intellectual property portfolio. The resolution of any valuation disputes is beyond the scope of Ashford's duties and will be addressed in the mediation or, if necessary, in further court proceedings.

The following table summarizes the estimated values of the Estate's assets:

G. Non-Probate Assets Excluded from Administration

For the avoidance of doubt, the following assets are not included within the probate estate and are expressly excluded from the scope of Ashford's administration:

1. Term Life Insurance Policy: Meridian Mutual Life Insurance Co., Policy No. GH-TL-2019-05582, with a death benefit of $3,000,000. The named beneficiary is Marguerite D. Fonseca. This policy is payable directly to the named beneficiary as a non-probate asset.

2. Whole Life Insurance Policy: Commonwealth Fidelity Assurance Corp., Policy No. GH-WL-2014-01247, with a death benefit of $2,000,000. The named beneficiary is Marguerite D. Fonseca. This policy is likewise payable directly to the named beneficiary as a non-probate asset.

The total non-probate life insurance proceeds are $5,000,000. A separate Petition for Preliminary Distribution of Non-Probate Assets was filed with the Court on January 18, 2023, and remains pending. These proceeds are not within the scope of Ashford's authority or responsibility, and Ashford should not take any action with respect to these insurance policies.

IV. Scope of Ashford's Administrative Duties

This Section sets forth in greater detail the scope and nature of Ashford's duties as neutral administrator, consistent with the terms of the Stipulation and the Court's order.

A. Asset Preservation and Management

Ashford's primary obligation is to maintain and preserve all probate estate assets in their current condition, to the greatest extent practicable, pending resolution of the dispute between the parties. In furtherance of this obligation, Ashford shall:

(a) Maintain and preserve all probate estate assets identified in Section III above, exercising the degree of care and diligence expected of a professional fiduciary under California Probate Code sections 16040 et seq.;

(b) Ensure that both real properties—the Beverly Hills Residence at 1847 Coldwater Canyon Drive and the Malibu Beach House at 27100 Pacific Coast Highway—are adequately maintained, insured, and secured at all times, including but not limited to the payment of property taxes, homeowner's insurance premiums, and necessary maintenance and repair costs from estate funds (subject to the limitations described below);

(c) Monitor all financial accounts at Veltara Basin Bank, N.A.—including the brokerage account (ending -4782), the personal checking account (ending -3091), and the money market account (ending -6155)—and ensure that such accounts remain frozen except for approved estate-related disbursements;

(d) Not make any distributions from the Estate to any party or claimant without prior court order or the prior written consent of all parties (i.e., both Ms. Fonseca's counsel and the Contestants' counsel). This restriction is fundamental to Ashford's neutral role and must be strictly observed.

We emphasize the critical importance of the restriction set forth in subparagraph (d) above. The neutral administrator's role is to preserve the Estate's assets, not to adjudicate or prioritize claims. Any request for a distribution should be directed to counsel for both sides so that, if agreement cannot be reached, the matter can be brought before the Court.

B. Coordination with Estate Professionals

Ashford is expected to work cooperatively with the professional advisors engaged in connection with the Estate, including:

(a) Ridgeway Accounting Partners LLP. The Estate's accounting firm is Ridgeway Accounting Partners LLP, under the direction of Dennis Chua, CPA (lead accountant). Mr. Chua's offices are located at 515 South Flower Street, Suite 3600, Los Angeles, CA 90071. Ashford should coordinate with Mr. Chua and his team regarding the preparation of the estate inventory, estate and trust income tax filings, the decedent's final personal income tax return, and ongoing financial reconciliation of estate assets and liabilities.

(b) Appraisers. Each side has retained its own appraisal firm: Pinnacle West Appraisal Group LLC has been retained by Ms. Fonseca, and Hargrove & Linden Appraisals Inc. has been retained by the Contestants. Ashford shall facilitate access for both appraisers to all estate assets—including, where applicable, coordinating property inspections, document production, and access to financial records—on an even-handed and non-discriminatory basis. Neither appraiser should be given preferential access or information.

(c) Coastline Title & Escrow Co. Ashford should coordinate with Coastline Title & Escrow Co. (Andrea Solis, contact) regarding all matters related to the title and encumbrance status of the two real properties, including responding to any title inquiries and ensuring that appropriate lien protection is maintained.

C. Business Interest Oversight

As noted above, the decedent's membership interests in Lumiére Canyon Studios LLC and Pacific Rim Narrative Partners LLC represent a substantial portion of the Estate's value. Ashford's role with respect to these interests is limited to monitoring and oversight and does not extend to active management of either entity's business operations. Specifically, Ashford shall:

(a) Monitor the status of the decedent's membership interests in Lumiére Canyon Studios LLC and Pacific Rim Narrative Partners LLC, including reviewing any financial statements, operating reports, or other documentation provided by the entities;

(b) Receive and preserve all distributions, Schedule K-1 tax statements, quarterly and annual financial reports, capital account statements, and any other correspondence or documentation issued by either entity in connection with the decedent's membership interests;

(c) Promptly notify both Calderwood & Harkness LLP and Brennan, Ortega & Saldívar LLP of any material developments relating to either entity, including but not limited to capital calls, distribution events, proposed amendments to operating agreements, requests for consent or approval, litigation or regulatory matters affecting the entities, or any other events that may have a material impact on the value of the decedent's interests.

For the avoidance of doubt, Ashford is not authorized to vote, consent to, or approve any actions on behalf of the decedent's membership interests in either entity without the prior written consent of both sides or a court order. Any such requests should be promptly communicated to both counsel for evaluation.

D. Neutrality Obligation

The foundation of Ashford's appointment is its status as a neutral fiduciary. Ashford must act as a neutral fiduciary at all times, without favoring the interests of any party to this proceeding. In furtherance of this obligation:

(a) Ashford shall communicate equally with Calderwood & Harkness LLP and Brennan, Ortega & Saldívar LLP regarding all estate administration matters. No substantive communication regarding the Estate or its assets shall be directed exclusively to one side without simultaneous or contemporaneous disclosure to the other;

(b) Ashford shall not take any action that could reasonably be perceived as favoring the interests of either Ms. Fonseca or the Contestants over the other;

(c) In the event that any dispute arises regarding the scope of Ashford's authority or the propriety of any proposed action, Ashford should seek guidance from the Court before proceeding. Either side may also seek court intervention as appropriate.

We trust that Ashford appreciates the sensitivity of this matter and the importance of maintaining strict neutrality throughout the administration.

V. Fee Arrangement and Cost-Sharing

The fee arrangement for Ashford's services as neutral administrator has been established by the Stipulation. This Section confirms the applicable fees and the agreed-upon cost-sharing structure.

A. Monthly Administration Fee

Ashford's monthly administration fee shall be $8,500 per month, as stipulated in the Stipulation for Appointment of Neutral Administrator filed and entered on March 22, 2023. This fee compensates Ashford for its routine administration services, including account monitoring, correspondence, coordination with estate professionals, and general fiduciary oversight.

B. Asset-Based Fee

In addition to the monthly administration fee, Ashford is entitled to an asset-based fee of 0.15% of assets under administration per annum. This fee shall be calculated on the basis of the aggregate value of the probate estate assets under Ashford's administration and shall be billed quarterly in arrears. For purposes of calculating this fee, the asset values shall be based on the most recently available valuations, account balances, or appraisals, as updated from time to time. In the event of a dispute regarding the applicable asset values for fee calculation purposes, the parties shall confer in good faith to reach agreement, and, if necessary, submit the matter to the Court for resolution.

C. Equal Cost-Sharing Arrangement

The parties have agreed that the costs of Ashford's administration shall be shared equally between the two sides, as follows:

(a) Monthly Administration Fee: The $8,500 monthly fee shall be divided equally, with $4,250 per month payable by Ms. Fonseca and $4,250 per month payable collectively by the Contestants (Rafael T. Fonseca, Isabela C. Fonseca-Greer, and Nicolás R. Fonseca).

(b) Asset-Based Fee: The 0.15% per annum asset-based fee shall similarly be shared equally between the two sides, with one-half payable by Ms. Fonseca and one-half payable collectively by the Contestants.

(c) Invoicing: Ashford shall issue separate invoices to each side. Invoices for Ms. Fonseca's share should be directed to Calderwood & Harkness LLP, 350 South Grand Avenue, Suite 4800, Los Angeles, CA 90071, Attn: Elliot Nguyen. Invoices for the Contestants' share should be directed to Brennan, Ortega & Saldívar LLP, 1900 Avenue of the Stars, Suite 2100, Los Angeles, CA 90067, Attn: Damian R. Ortega. Duplicate copies of all invoices should be sent to both firms so that each side has full visibility into the total fees being charged by Ashford.

D. Payment Terms

Invoices shall be rendered on a monthly basis, and payment shall be due within thirty (30) days of receipt of each invoice. All invoices should reference Case No. 22STPB09714 and the full caption of the proceeding, and should be sufficiently detailed to permit review by both sides and, if necessary, by the Court. Invoiced line items should include a description of services rendered, the time period covered, and a breakdown distinguishing between the monthly administration fee and the asset-based fee (where applicable).

In the event that either side fails to pay its share of Ashford's fees within the specified payment period, the non-defaulting side shall not be responsible for the defaulting side's share, and Ashford may seek an order from the Court compelling payment.

VI. Quarterly Reporting Requirements

Timely and transparent reporting is essential to the proper administration of the Estate and to the maintenance of confidence among all parties. Accordingly, we request that Ashford provide quarterly reports to both Calderwood & Harkness LLP and Brennan, Ortega & Saldívar LLP, containing the information described below.

A. Financial Report

Each quarterly report shall include a comprehensive financial report covering the reporting period, including, at a minimum, the following:

(a) A summary of all estate accounts, including current balances, all transactions during the reporting period, and interest accrued;

(b) The specific status of each of the Veltara Basin Bank, N.A. accounts: brokerage account (ending -4782), personal checking account (ending -3091), and money market account (ending -6155), including beginning and ending balances and a register of all activity;

(c) A schedule of all receipts, including any distributions received from Lumiére Canyon Studios LLC, Pacific Rim Narrative Partners LLC, or from the intellectual property portfolio (royalties and residuals);

(d) A schedule of all disbursements, including but not limited to administration expenses, property taxes, insurance premiums, maintenance and repair costs, professional fees, and any other expenditures made from estate funds, with supporting documentation for any disbursement exceeding $5,000.

B. Asset Status Report

Each quarterly report shall also include an asset status report, covering:

(a) The current condition and insurance status of both real properties (the Beverly Hills Residence at 1847 Coldwater Canyon Drive, Beverly Hills, CA 90210, and the Malibu Beach House at 27100 Pacific Coast Highway, Malibu, CA 90265), including a summary of any maintenance, repair, or capital improvement activity during the reporting period;

(b) A summary of all communications received from, or sent to, Lumiére Canyon Studios LLC and Pacific Rim Narrative Partners LLC during the reporting period, including any financial reports, distribution notices, K-1 statements, capital call notices, or other material correspondence;

(c) The status of intellectual property portfolio royalty collections, including a summary of royalty payments received and any pending or disputed royalty obligations.

C. Reporting Schedule

Quarterly reports shall be due within fifteen (15) days of each calendar quarter-end, as follows:

• Q2 2023: Report due by July 15, 2023 (covering the period from appointment through June 30, 2023)

• Q3 2023: Report due by October 15, 2023

• Q4 2023: Report due by January 15, 2024

• Subsequent quarters to follow the same schedule (April 15, July 15, October 15, January 15)

The first report shall cover the period from the date of Ashford's appointment through June 30, 2023, and will necessarily be somewhat abbreviated given the abbreviated reporting period.

All quarterly reports shall be delivered simultaneously to both counsel at the following addresses:

Calderwood & Harkness LLP 350 South Grand Avenue, Suite 4800 Los Angeles, CA 90071

Attn: Howard Quinn / Elliot Nguyen

Brennan, Ortega & Saldívar LLP 1900 Avenue of the Stars, Suite 2100 Los Angeles, CA 90067

Attn: Damian R. Ortega / Lydia Kwan

Simultaneous delivery to both firms is essential to maintain the transparency and neutrality that underpin Ashford's appointment.

VII. Pending Claims Against the Estate

For Ashford's awareness and for the purpose of ensuring proper administration, we briefly identify below certain pending claims that have been asserted by the Contestants against the Estate. These claims are disputed by Ms. Fonseca and remain unresolved. We bring them to your attention so that Ashford is informed, but we emphasize that Ashford should not take any action with respect to these claims—including making any payment—absent a court order or the written consent of both sides.

1. Isabela C. Fonseca-Greer — Promissory Note Claim. Isabela C. Fonseca-Greer has asserted a claim based on a promissory note dated January 15, 2020, in the principal amount of $1,200,000, plus accrued interest at 3.5% per annum, payable to Amber Light Documentary Films LLC, an entity in which Ms. Fonseca-Greer holds a controlling interest. Ms. Fonseca disputes the validity and enforceability of this claim. The total amount claimed by Ms. Fonseca-Greer, inclusive of accrued interest through the date of death (September 3, 2022), is approximately $1,310,460.

2. Nicolás R. Fonseca — Educational Expense Reimbursement Claim. Nicolás R. Fonseca has asserted a claim in the amount of $387,500 for educational expense reimbursement, based on an alleged oral promise by the decedent to reimburse him for graduate school tuition and related costs. Ms. Fonseca disputes this claim, both as to the existence of the alleged oral promise and as to the amount claimed.

We reiterate that Ashford should not make any payment or take any administrative action in connection with either of these claims without a court order. Any inquiry or demand from the Contestants or their counsel regarding these claims should be directed to both Calderwood & Harkness LLP and Brennan, Ortega & Saldívar LLP.

VIII. Points of Contact

To ensure efficient and orderly communication during the course of the administration, the following individuals are designated as the primary points of contact:

For Ms. Fonseca (Petitioner): Elliot Nguyen, Lead Associate Calderwood & Harkness LLP 350 South Grand Avenue, Suite 4800 Los Angeles, CA 90071 Telephone: (213) 555-7200

With copies on all substantive correspondence to: Howard Quinn, Responsible Partner Calderwood & Harkness LLP (same address)

For the Contestants: Damian R. Ortega, Partner Brennan, Ortega & Saldívar LLP 1900 Avenue of the Stars, Suite 2100 Los Angeles, CA 90067 Telephone: (310) 555-3400

At Ashford Fiduciary Services Inc.: Gerald Whitmore, Principal Officer Ashford Fiduciary Services Inc. 600 Wilshire Boulevard, Suite 1450 Los Angeles, CA 90017 Telephone: (213) 555-8600

Please note that Ms. Fonseca should not be contacted directly by Ashford or its personnel without prior coordination through Calderwood & Harkness LLP. All communications regarding the Estate should be directed to counsel in the first instance. We expect that the Contestants' counsel will provide similar instructions with respect to their clients.

IX. Request for Confirmation

We respectfully request that Mr. Whitmore, on behalf of Ashford Fiduciary Services Inc., confirm in writing his agreement with the terms set forth in this letter, including, without limitation:

(a) The scope of administrative duties as described in Section IV;

(b) The fee arrangement and cost-sharing structure as described in Section V;

(d) The neutrality obligations and communication protocols described herein; and

(e) Ashford's commitment to commence administration promptly following confirmation.

In addition, we request that Ashford provide our office with the following documentation at its earliest convenience:

(a) Evidence of Ashford's professional errors and omissions insurance currently in effect, including the name of the insurer, policy number, coverage limits, and policy period; and

(b) Evidence of any bonding required or maintained by Ashford in connection with its fiduciary services, including the name of the surety, bond number, and penal sum.

We will share copies of the foregoing documentation with Contestants' counsel upon receipt. Prompt confirmation will allow the parties to move forward with confidence that the Estate's assets are being properly safeguarded during the pendency of the mediation and any further proceedings.

X. Confidentiality Reminder

Finally, we wish to remind Ashford that the underlying dispute between Ms. Fonseca and the Contestants is subject to confidentiality provisions, including those contained in the Court's mediation order, those contemplated in the pending settlement discussions, and those to be set forth in the anticipated Settlement Standstill Agreement currently being negotiated between counsel. Ashford and all of its personnel, agents, and contractors who may have access to estate information must treat all estate information and all communications from counsel as strictly confidential. No estate information, financial data, asset details, or communications from either side's counsel may be disclosed to any third party without the prior written consent of both counsel or an order of the Court.

We trust that Ashford maintains internal policies and procedures sufficient to ensure compliance with these confidentiality obligations, and we ask that you confirm this in your written response.

We appreciate Ashford's willingness to serve in this important role and look forward to a productive working relationship. Should you have any questions regarding the contents of this letter, please do not hesitate to contact me or Elliot Nguyen at the number listed above.

Sincerely,

CALDERWOOD & HARKNESS LLP

By: ________

Howard Quinn Partner

Enclosures:

1. Copy of Stipulation for Appointment of Neutral Administrator (filed March 22, 2023)

2. Preliminary Estate Asset Summary prepared by Calderwood & Harkness LLP

cc:

Marguerite D. Fonseca (via email) Elliot Nguyen, Calderwood & Harkness LLP Grace Nakamura, Calderwood & Harkness LLP Damian R. Ortega, Brennan, Ortega & Saldívar LLP (via email and first class mail) Dennis Chua, Ridgeway Accounting Partners LLP (via email)

Asset Category	Estimated Value
Beverly Hills Residence	$8,450,000
Malibu Beach House	$6,200,000
Lumiére Canyon Studios LLC (50% interest)	$15,800,000
Pacific Rim Narrative Partners LLC (35% interest)	$27,475,000
Veltara Basin Bank — Brokerage (-4782)	$5,120,000
Veltara Basin Bank — Checking (-3091)	$342,000
Veltara Basin Bank — Money Market (-6155)	$1,875,000
Intellectual Property Portfolio (NPV)	$4,600,000
Personal Property (Art, Vehicles, Furnishings)	$1,250,000
Total Estimated Probate Estate	$71,112,000

CALDERWOOD & HARKNESS LLP Attorneys at Law 350 South Grand Avenue, Suite 4800 Los Angeles, California 90071 Telephone: (213) 555-7200 Facsimile: (213) 555-7201
March 25, 2023
Via Email and First Class Mail
Gerald Whitmore, Principal Officer Ashford Fiduciary Services Inc. 600 Wilshire Boulevard, Suite 1450 Los Angeles, CA 90017
Re: In re Estate of Teodoro R. Fonseca, Deceased Los Angeles County Superior Court, Case No. 22STPB09714 Appointment as Neutral Estate Administrator Calderwood & Harkness LLP Matter No. 1035-00005
Dear Mr. Whitmore:
I. Purpose and Context of This Letter
This letter confirms the terms and scope of Ashford Fiduciary Services Inc.'s ("Ashford") appointment as neutral administrator of the Estate of Teodoro R. Fonseca (the "Estate"), pursuant to the Stipulation for Appointment of Neutral Administrator filed with the Los Angeles County Superior Court on March 22, 2023, and entered by the Court in the above-referenced probate proceeding (the "Stipulation"). A copy of the Stipulation is enclosed for your reference.
As you are aware, this firm, Calderwood & Harkness LLP, represents Marguerite D. Fonseca, the surviving spouse and petitioner in this proceeding. The contestants in this matter are Rafael T. Fonseca, Isabela C. Fonseca-Greer, and Nicolás R. Fonseca (collectively, the "Contestants"), who are represented by Brennan, Ortega & Saldívar LLP (Damian R. Ortega, lead counsel), with offices at 1900 Avenue of the Stars, Suite 2100, Los Angeles, CA 90067. A copy of this letter is being provided simultaneously to Mr. Ortega for the sake of full transparency and to ensure that all parties operate with a shared understanding of the terms and expectations governing Ashford's administration.
The purpose of this letter is to set forth in detail the scope of Ashford's administrative duties, the fee arrangement and cost-sharing structure, the quarterly reporting requirements, and certain additional matters pertinent to the administration of the Estate. We ask that you review the contents carefully, and, as set forth in Section IX below, confirm your agreement in writing at your earliest convenience so that administration may commence without delay.
II. Background on the Estate
By way of background, Teodoro R. Fonseca passed away on September 3, 2022, without a will (intestate). Ms. Fonseca, as the surviving spouse, filed a Petition for Letters of Administration with the Los Angeles County Superior Court on October 5, 2022, seeking appointment as administrator of the Estate. The Contestants filed an initial objection to the petition on November 14, 2022, challenging certain aspects of Ms. Fonseca's proposed administration, and subsequently filed an amended objection on January 9, 2023, raising additional grounds and asserting various claims against the Estate.
In an effort to resolve the dispute and preserve the value of the Estate during the pendency of the contested proceeding, the Court, on March 10, 2023, ordered a stipulated mediation. The first mediation session has been scheduled before the Honorable Constance Adler (Ret.) of the Westside Dispute Resolution Center, and is currently set for April 12, 2023. Given the nature and complexity of the Estate's assets—which include significant real property holdings, business interests, financial accounts, and intellectual property—the parties recognized the need for a professional, neutral administrator to preserve and manage those assets while the underlying dispute is pending. To that end, the parties stipulated to the appointment of Ashford as a neutral administrator, and the Court so ordered on March 22, 2023.
Ashford's appointment is intended to ensure that the Estate's assets are safeguarded, properly maintained, and accounted for during the pendency of the litigation and mediation process, without prejudice to the interests or positions of either side.
III. Identification of Estate Assets Under Administration
The following assets constitute the probate estate and fall within the scope of Ashford's administration. This summary is based on the Preliminary Estate Asset Summary prepared by our firm (a copy of which is enclosed), as supplemented by preliminary appraisals and account records obtained to date.
A. Real Property
The Estate includes two parcels of real property located in Los Angeles County:
1. Beverly Hills Residence: 1847 Coldwater Canyon Drive, Beverly Hills, CA 90210. This property serves as the primary family residence. The estimated fair market value of this property is $8,450,000, based on a preliminary appraisal conducted by Pinnacle West Appraisal Group LLC dated February 10, 2023.
2. Malibu Beach House: 27100 Pacific Coast Highway, Malibu, CA 90265. This property is a secondary residence. The estimated fair market value of this property is $6,200,000, also based on a preliminary appraisal by Pinnacle West Appraisal Group LLC dated February 10, 2023.
Title records for both properties are currently held by Coastline Title & Escrow Co. The primary contact at Coastline is Andrea Solis, whose office is located at 9401 Wilshire Boulevard, Suite 720, Beverly Hills, CA 90212. Ms. Solis has been advised of Ashford's appointment and is prepared to coordinate with you regarding title matters.
B. Business Interests
The decedent held membership interests in two California limited liability companies, each of which represents a substantial component of the Estate:
1. Lumiére Canyon Studios LLC. The decedent held a fifty percent (50%) membership interest in Lumiére Canyon Studios LLC, a California limited liability company (California Secretary of State Filing No. 200906410337). The principal office of Lumiére Canyon Studios LLC is located at 4200 West Olive Avenue, Burbank, CA 91505. Based on an enterprise value of approximately $31,600,000 as of December 31, 2021, the estimated value of the decedent's 50% membership interest is approximately $15,800,000. We note that this valuation is preliminary and subject to adjustment upon completion of formal appraisals.
2. Pacific Rim Narrative Partners LLC. The decedent held a thirty-five percent (35%) membership interest in Pacific Rim Narrative Partners LLC, a California limited liability company (California Secretary of State Filing No. 201518720492). The managing member of Pacific Rim Narrative Partners LLC is Victor Sandoval, whose office is located at 8455 Beverly Boulevard, Suite 310, Los Angeles, CA 90048. Based on approximately $78,500,000 in assets under management, the estimated value of the decedent's 35% membership interest is approximately $27,475,000. This valuation is likewise preliminary and subject to further refinement.
As discussed further in Section IV below, Ashford's role with respect to these business interests is limited to monitoring and preserving the decedent's membership interests, and does not extend to active management of either entity's operations.
C. Financial Accounts at Veltara Basin Bank, N.A.
The decedent maintained the following financial accounts at Veltara Basin Bank, N.A., all of which are included in the probate estate:
1. Brokerage Account (Account No. ending in -4782): Approximate balance as of the date of death (September 3, 2022): $5,120,000.
2. Personal Checking Account (Account No. ending in -3091): Approximate balance as of the date of death: $342,000.
3. Money Market Account (Account No. ending in -6155): Approximate balance as of the date of death: $1,875,000.
The Estate's designated relationship manager at Veltara Basin Bank, N.A. is Franklin Ybarra, located at 700 South Hope Street, Los Angeles, CA 90017. Mr. Ybarra has been notified of Ashford's appointment and is prepared to work with you in facilitating account access and reporting. We ask that you coordinate directly with Mr. Ybarra regarding account signatories, account freezes, and any necessary documentation to reflect Ashford's authority over these accounts.
D. Intellectual Property Portfolio
The decedent was a producer and held royalty streams and residuals from fourteen (14) feature films and six (6) television series. The net present value of these royalty streams is estimated at approximately $4,600,000, based on a preliminary analysis conducted by Pinnacle West Appraisal Group LLC. A detailed schedule of the underlying intellectual property interests, including the applicable guilds, distributors, and collection agents, will be provided to Ashford under separate cover once the Estate inventory is finalized in coordination with Ridgeway Accounting Partners LLP.
E. Personal Property
The Estate also includes tangible personal property consisting of art, vehicles, and household furnishings, collectively estimated at approximately $1,250,000. A detailed inventory of these items is currently being compiled and will be made available to Ashford in due course.
F. Aggregate Probate Estate Estimate
Based on the foregoing, the total estimated probate estate is approximately $71,112,000 per our client's calculation. We note that the Contestants, through their counsel, have advanced an alternative aggregate estimate of approximately $68,750,000, reflecting certain differences in their preliminary valuations of the business interests and intellectual property portfolio. The resolution of any valuation disputes is beyond the scope of Ashford's duties and will be addressed in the mediation or, if necessary, in further court proceedings.
The following table summarizes the estimated values of the Estate's assets:
G. Non-Probate Assets Excluded from Administration
For the avoidance of doubt, the following assets are not included within the probate estate and are expressly excluded from the scope of Ashford's administration:
1. Term Life Insurance Policy: Meridian Mutual Life Insurance Co., Policy No. GH-TL-2019-05582, with a death benefit of $3,000,000. The named beneficiary is Marguerite D. Fonseca. This policy is payable directly to the named beneficiary as a non-probate asset.
2. Whole Life Insurance Policy: Commonwealth Fidelity Assurance Corp., Policy No. GH-WL-2014-01247, with a death benefit of $2,000,000. The named beneficiary is Marguerite D. Fonseca. This policy is likewise payable directly to the named beneficiary as a non-probate asset.
The total non-probate life insurance proceeds are $5,000,000. A separate Petition for Preliminary Distribution of Non-Probate Assets was filed with the Court on January 18, 2023, and remains pending. These proceeds are not within the scope of Ashford's authority or responsibility, and Ashford should not take any action with respect to these insurance policies.
IV. Scope of Ashford's Administrative Duties
This Section sets forth in greater detail the scope and nature of Ashford's duties as neutral administrator, consistent with the terms of the Stipulation and the Court's order.
A. Asset Preservation and Management
Ashford's primary obligation is to maintain and preserve all probate estate assets in their current condition, to the greatest extent practicable, pending resolution of the dispute between the parties. In furtherance of this obligation, Ashford shall:
(a) Maintain and preserve all probate estate assets identified in Section III above, exercising the degree of care and diligence expected of a professional fiduciary under California Probate Code sections 16040 et seq.;
(b) Ensure that both real properties—the Beverly Hills Residence at 1847 Coldwater Canyon Drive and the Malibu Beach House at 27100 Pacific Coast Highway—are adequately maintained, insured, and secured at all times, including but not limited to the payment of property taxes, homeowner's insurance premiums, and necessary maintenance and repair costs from estate funds (subject to the limitations described below);
(c) Monitor all financial accounts at Veltara Basin Bank, N.A.—including the brokerage account (ending -4782), the personal checking account (ending -3091), and the money market account (ending -6155)—and ensure that such accounts remain frozen except for approved estate-related disbursements;
(d) Not make any distributions from the Estate to any party or claimant without prior court order or the prior written consent of all parties (i.e., both Ms. Fonseca's counsel and the Contestants' counsel). This restriction is fundamental to Ashford's neutral role and must be strictly observed.
We emphasize the critical importance of the restriction set forth in subparagraph (d) above. The neutral administrator's role is to preserve the Estate's assets, not to adjudicate or prioritize claims. Any request for a distribution should be directed to counsel for both sides so that, if agreement cannot be reached, the matter can be brought before the Court.
B. Coordination with Estate Professionals
Ashford is expected to work cooperatively with the professional advisors engaged in connection with the Estate, including:
(a) Ridgeway Accounting Partners LLP. The Estate's accounting firm is Ridgeway Accounting Partners LLP, under the direction of Dennis Chua, CPA (lead accountant). Mr. Chua's offices are located at 515 South Flower Street, Suite 3600, Los Angeles, CA 90071. Ashford should coordinate with Mr. Chua and his team regarding the preparation of the estate inventory, estate and trust income tax filings, the decedent's final personal income tax return, and ongoing financial reconciliation of estate assets and liabilities.
(b) Appraisers. Each side has retained its own appraisal firm: Pinnacle West Appraisal Group LLC has been retained by Ms. Fonseca, and Hargrove & Linden Appraisals Inc. has been retained by the Contestants. Ashford shall facilitate access for both appraisers to all estate assets—including, where applicable, coordinating property inspections, document production, and access to financial records—on an even-handed and non-discriminatory basis. Neither appraiser should be given preferential access or information.
(c) Coastline Title & Escrow Co. Ashford should coordinate with Coastline Title & Escrow Co. (Andrea Solis, contact) regarding all matters related to the title and encumbrance status of the two real properties, including responding to any title inquiries and ensuring that appropriate lien protection is maintained.
C. Business Interest Oversight
As noted above, the decedent's membership interests in Lumiére Canyon Studios LLC and Pacific Rim Narrative Partners LLC represent a substantial portion of the Estate's value. Ashford's role with respect to these interests is limited to monitoring and oversight and does not extend to active management of either entity's business operations. Specifically, Ashford shall:
(a) Monitor the status of the decedent's membership interests in Lumiére Canyon Studios LLC and Pacific Rim Narrative Partners LLC, including reviewing any financial statements, operating reports, or other documentation provided by the entities;
(b) Receive and preserve all distributions, Schedule K-1 tax statements, quarterly and annual financial reports, capital account statements, and any other correspondence or documentation issued by either entity in connection with the decedent's membership interests;
(c) Promptly notify both Calderwood & Harkness LLP and Brennan, Ortega & Saldívar LLP of any material developments relating to either entity, including but not limited to capital calls, distribution events, proposed amendments to operating agreements, requests for consent or approval, litigation or regulatory matters affecting the entities, or any other events that may have a material impact on the value of the decedent's interests.
For the avoidance of doubt, Ashford is not authorized to vote, consent to, or approve any actions on behalf of the decedent's membership interests in either entity without the prior written consent of both sides or a court order. Any such requests should be promptly communicated to both counsel for evaluation.
D. Neutrality Obligation
The foundation of Ashford's appointment is its status as a neutral fiduciary. Ashford must act as a neutral fiduciary at all times, without favoring the interests of any party to this proceeding. In furtherance of this obligation:
(a) Ashford shall communicate equally with Calderwood & Harkness LLP and Brennan, Ortega & Saldívar LLP regarding all estate administration matters. No substantive communication regarding the Estate or its assets shall be directed exclusively to one side without simultaneous or contemporaneous disclosure to the other;
(b) Ashford shall not take any action that could reasonably be perceived as favoring the interests of either Ms. Fonseca or the Contestants over the other;
(c) In the event that any dispute arises regarding the scope of Ashford's authority or the propriety of any proposed action, Ashford should seek guidance from the Court before proceeding. Either side may also seek court intervention as appropriate.
We trust that Ashford appreciates the sensitivity of this matter and the importance of maintaining strict neutrality throughout the administration.
V. Fee Arrangement and Cost-Sharing
The fee arrangement for Ashford's services as neutral administrator has been established by the Stipulation. This Section confirms the applicable fees and the agreed-upon cost-sharing structure.
A. Monthly Administration Fee
Ashford's monthly administration fee shall be $8,500 per month, as stipulated in the Stipulation for Appointment of Neutral Administrator filed and entered on March 22, 2023. This fee compensates Ashford for its routine administration services, including account monitoring, correspondence, coordination with estate professionals, and general fiduciary oversight.
B. Asset-Based Fee
In addition to the monthly administration fee, Ashford is entitled to an asset-based fee of 0.15% of assets under administration per annum. This fee shall be calculated on the basis of the aggregate value of the probate estate assets under Ashford's administration and shall be billed quarterly in arrears. For purposes of calculating this fee, the asset values shall be based on the most recently available valuations, account balances, or appraisals, as updated from time to time. In the event of a dispute regarding the applicable asset values for fee calculation purposes, the parties shall confer in good faith to reach agreement, and, if necessary, submit the matter to the Court for resolution.
C. Equal Cost-Sharing Arrangement
The parties have agreed that the costs of Ashford's administration shall be shared equally between the two sides, as follows:
(a) Monthly Administration Fee: The $8,500 monthly fee shall be divided equally, with $4,250 per month payable by Ms. Fonseca and $4,250 per month payable collectively by the Contestants (Rafael T. Fonseca, Isabela C. Fonseca-Greer, and Nicolás R. Fonseca).
(b) Asset-Based Fee: The 0.15% per annum asset-based fee shall similarly be shared equally between the two sides, with one-half payable by Ms. Fonseca and one-half payable collectively by the Contestants.
(c) Invoicing: Ashford shall issue separate invoices to each side. Invoices for Ms. Fonseca's share should be directed to Calderwood & Harkness LLP, 350 South Grand Avenue, Suite 4800, Los Angeles, CA 90071, Attn: Elliot Nguyen. Invoices for the Contestants' share should be directed to Brennan, Ortega & Saldívar LLP, 1900 Avenue of the Stars, Suite 2100, Los Angeles, CA 90067, Attn: Damian R. Ortega. Duplicate copies of all invoices should be sent to both firms so that each side has full visibility into the total fees being charged by Ashford.
D. Payment Terms
Invoices shall be rendered on a monthly basis, and payment shall be due within thirty (30) days of receipt of each invoice. All invoices should reference Case No. 22STPB09714 and the full caption of the proceeding, and should be sufficiently detailed to permit review by both sides and, if necessary, by the Court. Invoiced line items should include a description of services rendered, the time period covered, and a breakdown distinguishing between the monthly administration fee and the asset-based fee (where applicable).
In the event that either side fails to pay its share of Ashford's fees within the specified payment period, the non-defaulting side shall not be responsible for the defaulting side's share, and Ashford may seek an order from the Court compelling payment.
VI. Quarterly Reporting Requirements
Timely and transparent reporting is essential to the proper administration of the Estate and to the maintenance of confidence among all parties. Accordingly, we request that Ashford provide quarterly reports to both Calderwood & Harkness LLP and Brennan, Ortega & Saldívar LLP, containing the information described below.
A. Financial Report
Each quarterly report shall include a comprehensive financial report covering the reporting period, including, at a minimum, the following:
(a) A summary of all estate accounts, including current balances, all transactions during the reporting period, and interest accrued;
(b) The specific status of each of the Veltara Basin Bank, N.A. accounts: brokerage account (ending -4782), personal checking account (ending -3091), and money market account (ending -6155), including beginning and ending balances and a register of all activity;
(c) A schedule of all receipts, including any distributions received from Lumiére Canyon Studios LLC, Pacific Rim Narrative Partners LLC, or from the intellectual property portfolio (royalties and residuals);
(d) A schedule of all disbursements, including but not limited to administration expenses, property taxes, insurance premiums, maintenance and repair costs, professional fees, and any other expenditures made from estate funds, with supporting documentation for any disbursement exceeding $5,000.
B. Asset Status Report
Each quarterly report shall also include an asset status report, covering:
(a) The current condition and insurance status of both real properties (the Beverly Hills Residence at 1847 Coldwater Canyon Drive, Beverly Hills, CA 90210, and the Malibu Beach House at 27100 Pacific Coast Highway, Malibu, CA 90265), including a summary of any maintenance, repair, or capital improvement activity during the reporting period;
(b) A summary of all communications received from, or sent to, Lumiére Canyon Studios LLC and Pacific Rim Narrative Partners LLC during the reporting period, including any financial reports, distribution notices, K-1 statements, capital call notices, or other material correspondence;
(c) The status of intellectual property portfolio royalty collections, including a summary of royalty payments received and any pending or disputed royalty obligations.
C. Reporting Schedule
Quarterly reports shall be due within fifteen (15) days of each calendar quarter-end, as follows:
• Q2 2023: Report due by July 15, 2023 (covering the period from appointment through June 30, 2023)
• Q3 2023: Report due by October 15, 2023
• Q4 2023: Report due by January 15, 2024
• Subsequent quarters to follow the same schedule (April 15, July 15, October 15, January 15)
The first report shall cover the period from the date of Ashford's appointment through June 30, 2023, and will necessarily be somewhat abbreviated given the abbreviated reporting period.
All quarterly reports shall be delivered simultaneously to both counsel at the following addresses:
Calderwood & Harkness LLP 350 South Grand Avenue, Suite 4800 Los Angeles, CA 90071
Attn: Howard Quinn / Elliot Nguyen
Brennan, Ortega & Saldívar LLP 1900 Avenue of the Stars, Suite 2100 Los Angeles, CA 90067
Attn: Damian R. Ortega / Lydia Kwan
Simultaneous delivery to both firms is essential to maintain the transparency and neutrality that underpin Ashford's appointment.
VII. Pending Claims Against the Estate
For Ashford's awareness and for the purpose of ensuring proper administration, we briefly identify below certain pending claims that have been asserted by the Contestants against the Estate. These claims are disputed by Ms. Fonseca and remain unresolved. We bring them to your attention so that Ashford is informed, but we emphasize that Ashford should not take any action with respect to these claims—including making any payment—absent a court order or the written consent of both sides.
1. Isabela C. Fonseca-Greer — Promissory Note Claim. Isabela C. Fonseca-Greer has asserted a claim based on a promissory note dated January 15, 2020, in the principal amount of $1,200,000, plus accrued interest at 3.5% per annum, payable to Amber Light Documentary Films LLC, an entity in which Ms. Fonseca-Greer holds a controlling interest. Ms. Fonseca disputes the validity and enforceability of this claim. The total amount claimed by Ms. Fonseca-Greer, inclusive of accrued interest through the date of death (September 3, 2022), is approximately $1,310,460.
2. Nicolás R. Fonseca — Educational Expense Reimbursement Claim. Nicolás R. Fonseca has asserted a claim in the amount of $387,500 for educational expense reimbursement, based on an alleged oral promise by the decedent to reimburse him for graduate school tuition and related costs. Ms. Fonseca disputes this claim, both as to the existence of the alleged oral promise and as to the amount claimed.
We reiterate that Ashford should not make any payment or take any administrative action in connection with either of these claims without a court order. Any inquiry or demand from the Contestants or their counsel regarding these claims should be directed to both Calderwood & Harkness LLP and Brennan, Ortega & Saldívar LLP.
VIII. Points of Contact
To ensure efficient and orderly communication during the course of the administration, the following individuals are designated as the primary points of contact:
For Ms. Fonseca (Petitioner): Elliot Nguyen, Lead Associate Calderwood & Harkness LLP 350 South Grand Avenue, Suite 4800 Los Angeles, CA 90071 Telephone: (213) 555-7200
With copies on all substantive correspondence to: Howard Quinn, Responsible Partner Calderwood & Harkness LLP (same address)
For the Contestants: Damian R. Ortega, Partner Brennan, Ortega & Saldívar LLP 1900 Avenue of the Stars, Suite 2100 Los Angeles, CA 90067 Telephone: (310) 555-3400
At Ashford Fiduciary Services Inc.: Gerald Whitmore, Principal Officer Ashford Fiduciary Services Inc. 600 Wilshire Boulevard, Suite 1450 Los Angeles, CA 90017 Telephone: (213) 555-8600
Please note that Ms. Fonseca should not be contacted directly by Ashford or its personnel without prior coordination through Calderwood & Harkness LLP. All communications regarding the Estate should be directed to counsel in the first instance. We expect that the Contestants' counsel will provide similar instructions with respect to their clients.
IX. Request for Confirmation
We respectfully request that Mr. Whitmore, on behalf of Ashford Fiduciary Services Inc., confirm in writing his agreement with the terms set forth in this letter, including, without limitation:
(a) The scope of administrative duties as described in Section IV;
(b) The fee arrangement and cost-sharing structure as described in Section V;
(c) The quarterly reporting requirements and schedule as described in Section VI;
(d) The neutrality obligations and communication protocols described herein; and
(e) Ashford's commitment to commence administration promptly following confirmation.
In addition, we request that Ashford provide our office with the following documentation at its earliest convenience:
(a) Evidence of Ashford's professional errors and omissions insurance currently in effect, including the name of the insurer, policy number, coverage limits, and policy period; and
(b) Evidence of any bonding required or maintained by Ashford in connection with its fiduciary services, including the name of the surety, bond number, and penal sum.
We will share copies of the foregoing documentation with Contestants' counsel upon receipt. Prompt confirmation will allow the parties to move forward with confidence that the Estate's assets are being properly safeguarded during the pendency of the mediation and any further proceedings.
X. Confidentiality Reminder
Finally, we wish to remind Ashford that the underlying dispute between Ms. Fonseca and the Contestants is subject to confidentiality provisions, including those contained in the Court's mediation order, those contemplated in the pending settlement discussions, and those to be set forth in the anticipated Settlement Standstill Agreement currently being negotiated between counsel. Ashford and all of its personnel, agents, and contractors who may have access to estate information must treat all estate information and all communications from counsel as strictly confidential. No estate information, financial data, asset details, or communications from either side's counsel may be disclosed to any third party without the prior written consent of both counsel or an order of the Court.
We trust that Ashford maintains internal policies and procedures sufficient to ensure compliance with these confidentiality obligations, and we ask that you confirm this in your written response.
We appreciate Ashford's willingness to serve in this important role and look forward to a productive working relationship. Should you have any questions regarding the contents of this letter, please do not hesitate to contact me or Elliot Nguyen at the number listed above.
Sincerely,
CALDERWOOD & HARKNESS LLP
By: ________
Howard Quinn Partner
Enclosures:
1. Copy of Stipulation for Appointment of Neutral Administrator (filed March 22, 2023)
2. Preliminary Estate Asset Summary prepared by Calderwood & Harkness LLP
cc:
Marguerite D. Fonseca (via email) Elliot Nguyen, Calderwood & Harkness LLP Grace Nakamura, Calderwood & Harkness LLP Damian R. Ortega, Brennan, Ortega & Saldívar LLP (via email and first class mail) Dennis Chua, Ridgeway Accounting Partners LLP (via email)
Asset Category | Estimated Value
Beverly Hills Residence | $8,450,000
Malibu Beach House | $6,200,000
Lumiére Canyon Studios LLC (50% interest) | $15,800,000
Pacific Rim Narrative Partners LLC (35% interest) | $27,475,000
Veltara Basin Bank — Brokerage (-4782) | $5,120,000
Veltara Basin Bank — Checking (-3091) | $342,000
Veltara Basin Bank — Money Market (-6155) | $1,875,000
Intellectual Property Portfolio (NPV) | $4,600,000
Personal Property (Art, Vehicles, Furnishings) | $1,250,000
Total Estimated Probate Estate | $71,112,000

CALDERWOOD & HARKNESS LLP

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