Ten months into what has been – until now – an especially nasty breakup, Charlie Sheen and Denise Richards have decided to play nice, PEOPLE reports in its new issue.

In August, they resolved any outstanding issues in their divorce (although the split has still not been finalized) and recently they've been spending time together with their daughters Sam, 2, and Lola, 1.

"When it comes to the welfare of their children, any past drama is history," says a rep for Sheen, 41.

A friend of Richards, 35, confirms "they're working really hard to be friends and great parents."

Case in point? On Oct. 15 they hit a local fall festival with their daughters. Also along: Sheen's girlfriend of around four months, actress Brooke Mueller, 29.

"Denise wants her to feel comfortable," says the Richards pal. "She put together a bag with toys for her and the girls along with a card telling her she's glad (Brooke) makes their father so happy."

Meanwhile, Richards, 35, and Richie Sambora have been together for about six months and are "doing great." It all makes for one happy, Hollywood-style extended family.

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