SECOND AMENDMENT TO SETTLEMENT STANDSTILL AGREEMENT
In re Estate of Teodoro R. Fonseca, Deceased
Los Angeles County Superior Court, Probate Division Case No. 22STPB09714
Effective Date: April 28, 2024
This Second Amendment to Settlement Standstill Agreement (this "Second Amendment") is entered into as of April 28, 2024, by and among the following parties:
MARGUERITE D. FONSECA ("Petitioner"), an individual residing at 1847 Coldwater Canyon Drive, Beverly Hills, California 90210, the surviving spouse of the decedent Teodoro R. Fonseca;
and
RAFAEL T. FONSECA, an individual residing at 502 Olive Avenue, Unit 3, Burbank, California 91502;
ISABELA C. FONSECA-GREER, an individual residing at 78 Eucalyptus Lane, Santa Monica, California 90402; and
NICOLÁS R. FONSECA, an individual residing at 1190 Elm Street, Apt. 4B, Palo Alto, California 94301
(Rafael T. Fonseca, Isabela C. Fonseca-Greer, and Nicolás R. Fonseca are collectively referred to herein as the "Contestants").
Petitioner and Contestants are collectively referred to herein as the "Parties" and individually as a "Party."
RECITALS
A. The Original Agreement. The Parties entered into a Settlement Standstill Agreement dated April 28, 2023 (the "Original Agreement"), in connection with the contested probate proceeding styled In re Estate of Teodoro R. Fonseca, Case No. 22STPB09714, pending in the Los Angeles County Superior Court, Probate Division. The Original Agreement, among other things: (i) tolled all litigation deadlines applicable to the proceeding; (ii) prohibited the filing of new motions, discovery requests, or other pleadings by any Party during the standstill period; (iii) provided for the continued neutral administration of the estate by Ashford Fiduciary Services Inc.; and (iv) imposed confidentiality provisions applicable to all settlement discussions conducted during the standstill period. Pursuant to Section 3 of the Original Agreement, the standstill was renewable in successive six-month increments by mutual written consent of all Parties and was terminable by either Petitioner or Contestants upon thirty (30) days' prior written notice to the other side.
B. The First Amendment. The Parties executed the First Amendment to Settlement Standstill Agreement on October 28, 2023 (the "First Amendment"), which extended the term of the Original Agreement from its initial expiration date of October 28, 2023, through and including April 28, 2024. All other terms and conditions of the Original Agreement remained unchanged and in full force and effect pursuant to the First Amendment.
C. Desire to Further Extend. The current term of the Original Agreement, as amended by the First Amendment, expires on April 28, 2024. The Parties have engaged in productive informal settlement discussions during the standstill period and desire to further extend the term of the Original Agreement through October 28, 2024, on the same terms and conditions, in order to continue such informal settlement discussions and to preserve the status quo with respect to the administration of the estate while those discussions are ongoing.
D. Neutral Estate Administrator. Ashford Fiduciary Services Inc. (Gerald Whitmore, principal officer), located at 600 Wilshire Boulevard, Suite 1450, Los Angeles, California 90017, continues to serve as the neutral administrator of the estate pursuant to the Stipulation for Appointment of Neutral Administrator filed with the Court on March 22, 2023, and the Court's order approving the same. The monthly administration fee of Eight Thousand Five Hundred Dollars ($8,500.00), plus fifteen-hundredths of one percent (0.15%) of assets under administration per annum, continues to be shared equally between the Parties, with Four Thousand Two Hundred Fifty Dollars ($4,250.00) per month payable by Petitioner and Four Thousand Two Hundred Fifty Dollars ($4,250.00) per month payable by Contestants collectively, in accordance with the Original Agreement and the Stipulation.
E. Counsel. Petitioner is represented in this matter by Calderwood & Harkness LLP (Howard Quinn, Responsible Partner), with offices at 350 South Grand Avenue, Suite 4800, Los Angeles, California 90071. Contestants are represented in this matter by Brennan, Ortega & Saldívar LLP (Damian R. Ortega, Lead Attorney), with offices at 1900 Avenue of the Stars, Suite 2100, Los Angeles, California 90067.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
AGREEMENT
Section 1 — Amendment of Term
Section 3(a) of the Original Agreement, as previously amended by Section 1 of the First Amendment, which defines the term and expiration date of the standstill period, is hereby further amended to extend the expiration date from April 28, 2024, to October 28, 2024. The standstill period, including without limitation the tolling of all litigation deadlines and the prohibition on the filing of new motions, discovery requests, or other pleadings, shall continue in full force and effect through and including October 28, 2024, unless earlier terminated in accordance with the termination provisions of the Original Agreement. The Original Agreement, as amended by the First Amendment and this Second Amendment, shall remain renewable in additional successive six-month increments by the mutual written consent of all Parties, subject to the same procedures for renewal set forth in the Original Agreement.
Section 2 — Continued Tolling of Litigation Deadlines
All litigation deadlines in In re Estate of Teodoro R. Fonseca, Case No. 22STPB09714, pending in the Los Angeles County Superior Court, Probate Division, including but not limited to discovery deadlines, motion deadlines, hearing dates, and any other deadlines imposed by the Court, applicable rules of court, or applicable statutes, shall continue to be tolled through and including October 28, 2024, in accordance with the terms of the Original Agreement. Neither Petitioner nor Contestants shall file any new motions, discovery requests, subpoenas, or other pleadings or papers in the proceeding during the extended standstill period, except as may be necessary to preserve the status quo, to comply with any order of the Court, or as otherwise mutually agreed upon in writing by all Parties. Nothing in this Section 2 shall be construed to prevent any Party from responding to inquiries from the Court or from taking any action required by law or by order of the Court.
Section 3 — Continued Administration by Ashford Fiduciary Services Inc.
Ashford Fiduciary Services Inc. shall continue to serve as the neutral administrator of the estate during the extended standstill period, on the terms and conditions set forth in the Original Agreement and in the Stipulation for Appointment of Neutral Administrator filed with the Court on March 22, 2023. The Parties acknowledge and agree that the monthly administration fee of Eight Thousand Five Hundred Dollars ($8,500.00), plus fifteen-hundredths of one percent (0.15%) of assets under administration per annum, shall continue to be shared equally between Petitioner and Contestants, with Four Thousand Two Hundred Fifty Dollars ($4,250.00) per month payable by Petitioner and Four Thousand Two Hundred Fifty Dollars ($4,250.00) per month payable by Contestants collectively. Such payments shall continue to be made on the schedule and in the manner set forth in the Original Agreement. Nothing in this Second Amendment shall be deemed to modify the duties, responsibilities, or authority of Ashford Fiduciary Services Inc. as neutral administrator, which shall continue to be governed by the Original Agreement and the Stipulation.
Section 4 — Confidentiality
The confidentiality provisions set forth in Section 6 of the Original Agreement shall continue to apply in full force and effect to all settlement discussions, negotiations, correspondence, proposals, counterproposals, and related communications conducted during the extended standstill period established by this Second Amendment. All such communications shall remain privileged and confidential and shall not be admissible in any court proceeding, arbitration, or other forum, except as may be required by applicable law or by order of the Court. Nothing in this Second Amendment modifies, limits, expands, or otherwise alters the scope of the confidentiality obligations established in the Original Agreement, which obligations shall continue to survive any termination or expiration of the standstill period as set forth therein.
Section 5 — Termination Rights Preserved
Either Party's right to terminate the standstill on thirty (30) days' prior written notice to the other Party (or Parties), as set forth in Section 3(b) of the Original Agreement, remains unchanged and in full force and effect during the extended term established by this Second Amendment. For the avoidance of doubt, upon the effective date of any such termination, all tolled deadlines shall resume and the Parties shall be restored to their respective positions as if the standstill had expired on such effective date, subject to any further agreement of the Parties or order of the Court. Written notice of termination shall be provided in accordance with the notice provisions of the Original Agreement.
Section 6 — No Other Modifications
Except as expressly amended by this Second Amendment, all terms and conditions of the Original Agreement, as amended by the First Amendment, shall remain in full force and effect and are hereby ratified, confirmed, and restated in their entirety. Without limiting the generality of the foregoing, all provisions of the Original Agreement relating to the neutral administration of the estate, the allocation and payment of administration fees, the confidentiality of settlement discussions, the tolling of deadlines, and the rights and obligations of the Parties with respect to the probate proceeding shall continue unchanged. In the event of any conflict or inconsistency between the terms of this Second Amendment and the terms of the Original Agreement, as amended by the First Amendment, the terms of this Second Amendment shall control to the extent of such conflict or inconsistency.
Section 7 — Counterparts
This Second Amendment may be executed in two or more counterparts, each of which shall be deemed an original, and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of this Second Amendment by electronic transmission (including by electronic mail in portable document format (.pdf)) or by facsimile shall be equally effective as delivery of a manually executed counterpart. Electronic or facsimile signatures shall be deemed original signatures for all purposes under this Second Amendment and shall be sufficient to bind the Party on whose behalf such signature is delivered.
Section 8 — Governing Law
This Second Amendment shall be governed by and construed in accordance with the laws of the State of California, without giving effect to any choice-of-law or conflict-of-law rules or provisions that would cause the application of the laws of any other jurisdiction.
SIGNATURE PAGE TO SECOND AMENDMENT TO SETTLEMENT STANDSTILL AGREEMENT
IN WITNESS WHEREOF, the Parties have executed this Second Amendment to Settlement Standstill Agreement as of the date first written above.
PETITIONER:
________________________________________
Marguerite D. Fonseca
Date: April 28, 2024
CONTESTANTS:
________________________________________
Rafael T. Fonseca
Date: April 28, 2024
________________________________________
Isabela C. Fonseca-Greer
Date: April 28, 2024
________________________________________
Nicolás R. Fonseca
Date: April 28, 2024
COUNSEL SIGNATURE PAGE TO SECOND AMENDMENT TO SETTLEMENT STANDSTILL AGREEMENT
The undersigned counsel for the respective Parties acknowledge and approve the foregoing Second Amendment to Settlement Standstill Agreement:
COUNSEL FOR PETITIONER:
CALDERWOOD & HARKNESS LLP
By: ________
Name: Howard Quinn
Title: Partner, Responsible Partner
350 South Grand Avenue, Suite 4800 Los Angeles, California 90071
Date: April 28, 2024
COUNSEL FOR CONTESTANTS:
BRENNAN, ORTEGA & SALDÍVAR LLP
By: ________
Name: Damian R. Ortega
Title: Partner, Lead Attorney
1900 Avenue of the Stars, Suite 2100 Los Angeles, California 90067
Date: April 28, 2024