UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA JUN 2 2 ZOE 112 ALEXANDRIA DIVISION

Transcription

1 (#4;, UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA JUN 2 2 ZOE 112 ALEXANDRIA DIVISION IN RE THE MILLS CORPORATION ) CIVIL ACTION NO. SECURITIES LITIGATION ) 1:06-cv (LO-TRJ) ) This Document relates to: ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1 :06-cv (LO/TRJ) ) 1:07-cv (LO/TRJ) ) CLERK, U.S. DISTRICT COURT ALEXANDRIA. VIRGINIA ORDER PRELIMINARILY APPROVING E&Y AND KANAM SETTLEMENTS AND SETTING SETTLEMENT HEARING ("ORDER FOR NOTICE AND HEARING") WHEREAS: A. Lead Plaintiffs and defendants The Mills Corporation ("Mills") and The Mills Limited Partnership ("Mills LP") (collectively the "Mills Entities"), on behalf of themselves and for the benefit of the other Settling Defendants, the Purchasers, the Former Defendants and other Released Parties, entered into a Stipulation and Agreement of Settlement dated January 14, 2009 (the "Mills Stipulation") in full and final settlement of each and every Settled Claim against the Settling Defendants and the other Released Parties as defined therein (the "Mills Settlement"), the terms of which are set forth in the Mills Stipulation; B. On January 15, 2009, Lead Plaintiffs moved, pursuant to Rule 23(e) of the Federal Rules of Civil Procedure, for an Order preliminarily approving the Mills Settlement in accordance with the terms of the Mills Stipulation, certifying the above-captioned action (the "Action") to proceed as a class action for settlement purposes only, approving the form of Notice and Summary Notice to be provided to the Class, and providing for Notice to the Class;

2 (11*. ""I'41 C. On March 4, 2009, the Court entered an order preliminarily approving the Mills Settlement, certifying the Action to proceed with respect to the Mills Defendants as a class action for settlement purposes only, directing that Notice of the proposed settlement be given to the Class within thirty (30) days of entry of that Order, and scheduling a Settlement Hearing for final approval of the Mills Settlement for June 18, 2009 (the "March 4, 2009 Order"); D. On April 1, 2009, Lead Plaintiffs and Defendant Ernst & Young LLP ("E&Y") entered into an agreement in principle to settle the claims asserted by Lead Plaintiffs on behalf of themselves and the other members of the Class against E&Y; and, after being apprised of this fact by Lead Counsel, the Court directed that Notice of the Mills Settlement not be sent as previously ordered, but instead that one Notice informing the Class of the two proposed settlements be sent after the settlement with E&Y was fully documented; E. On May 11, 2009, Lead Counsel advised the Court that Lead Plaintiffs had reached an agreement to settle the claims asserted by Lead Plaintiffs on behalf of themselves and the other members of the Class against defendants KanAm Services, L.P., KanAm Management L.L.C., KanAm L.L.C., KanAm Providers, Inc., KanAm Realty, Inc., KanAm US, Inc., KanAm America, Inc., KanAm International GmbH, and KanAm Grund Kapitalanlagegesellschaft mbh (the "KanAm Defendants"), the last remaining defendants in the Action; F. In light of the agreements to settle reached with E&Y and the KanAm Defendants, the Court adjourned the Settlement Hearing previously scheduled for June 18, 2009, in order to allow for a single consolidated final approval hearing for all three settlements; G. Lead Plaintiffs and E&Y, on behalf of itself and for the benefit of other Released Parties, have entered into a Stipulation and Agreement of Settlement dated June 11, 2009 (the "E&Y Stipulation") in full and final settlement of each and every Settled Claim against E&Y and 2

3 rgrfr the other Released Parties as defined therein (the "E&Y Settlement"), the terms of which are set forth in the E&Y Stipulation; H. Lead Plaintiffs and the KanAm Defendants, on behalf of themselves and for the benefit of other Released Parties, have entered into a Stipulation and Agreement of Settlement dated June 11, 2009 (the "KanAm Stipulation") in full and final settlement of each and every Settled Claim against the KanAm Defendants and the other Released Parties as defined therein (the "KanAm Settlement"), the terms of which are set forth in the KanAm Stipulation; I. Lead Plaintiffs have moved, pursuant to Rule 23(e) of the Federal Rules of Civil Procedure, for an Order preliminarily approving the E&Y Settlement and the KanAm Settlement in accordance with the terms of their respective Stipulations and providing for notice to the Class of the Mills Settlement, the E&Y Settlement and the KanAm Settlement; and, J. The Court having read and considered both the E&Y Stipulation and KanAm Stipulation, and the exhibits thereto, including the proposed (i) Notice to the Class; (ii) Publication Notice; and (iii) Judgments, and finding that substantial and sufficient grounds exist for entering this Order. NOW, THEREFORE, IT IS HEREBY ORDERED: I. The Court, for purposes of this Order, adopts all defined terms as set forth in the Mills Stipulation, the E&Y Stipulation and the KanAm Stipulation (collectively the "Stipulations"). The Court hereby modifies its March 4, 2009 Order preliminarily approving the Mills Settlement to the extent necessary to conform its prior approval of the forms and contents of class notices and claim forms and the exclusion, objection and hearing dates contained therein to the approval of such items contained herein. Particularly, the terms of paragraphs 6 (but only as to the hearing date and subject of the hearing) through 29 shall supersede the related 3

4 provisions of the March 4, 2009 Order to the extent any conflict may exist between the provisions. 2. The Court, for purposes of this Order, refers to the Mills Settlement, the E&Y Settlement and the KanAm Settlement collectively as the "Settlements". 3. Notwithstanding the Court's Order of March 31, 2009, and Memorandum Opinion of April 16, 2009, with respect to Lead Plaintiffs' motion for class certification, the Court hereby certifies the Action with respect to E&Y and the KanAm Defendants to proceed as a class action for settlement purposes only, pursuant to Rule 23(a) and Rule 23(b)(3) of the Federal Rules of Civil Procedure, on behalf of the Class certified with respect to the Mills Settlement in the March 4, 2009 Order, i.e., on behalf of all persons who purchased or otherwise acquired Mills publicly traded common stock and preferred stock, during the period from February 27, 2001 through August 10, 2006, and who were damaged thereby. Excluded from the Class are: (a) Defendants and all persons and entities who (i) during the Class Period, were Defendants' officers, directors and partners or members of Defendants' immediate families or controlled by a Defendant or (ii) at any time, were Defendants' legal representatives, heirs, successors or assigns and assert a claim on the Total Settlement Fund (i.e., the Mills Settlement Amount of $165 million plus interest, the E&Y Settlement Amount of $29.75 million, and the KanAm Settlement Amount of $8 million, together with accrued interest on those amounts) based on a Defendant's purchase or other acquisition of Mills publicly traded common stock or preferred stock; and (b) persons who purchased and sold all of their Mills securities before the close of the market on October 31, Also excluded from the Class are any putative Class Members who exclude themselves by filing a request for exclusion in accordance with the requirements set forth in this Order and the Notice. 4

5 4. The Court finds, for the purposes of the E&Y and KanAm Settlements, as previously found with respect to the Mills Settlement, that the prerequisites for a class action under Rules 23(a) and (b)(3) of the Federal Rules of Civil Procedure have been satisfied in that: (a) the number of Class Members is so numerous that joinder of all members thereof is impracticable; (b) there are questions of law and fact common to the Class; (c) the claims of the named representatives are typical of the claims of the Class they seek to represent; (d) Lead Plaintiffs, additional named plaintiffs C. Bickley Foster, Frederic Elliott and Vernon E. Rudolph, and Lead Counsel have and will fairly and adequately represent the interests of the Class; (e) the questions of law and fact common to the members of the Class predominate over any questions affecting only individual members of the Class; and (f) a class action is superior to other available methods for the fair and efficient adjudication of the controversy. 5. The Court hereby finds and concludes that pursuant to Rule 23 of the Federal Rules of Civil Procedure, and for the purposes of the E&Y and KanAm Settlements, as previously found with respect to the Mills Settlement, that Lead Plaintiffs Iowa Public Employees' Retirement System and the Public Employees' Retirement System of Mississippi and additional named plaintiffs C. Bickley Foster, Frederic Elliott and Vernon E. Rudolph are adequate class representatives and certifies them as Class Representatives for the Class. The Court further certifies Lead Counsel as Class Counsel. 6. The Court preliminarily approves the E&Y Settlement and the KanAm Settlement, each on the terms set forth in its respective Stipulation, as it previously approved the Mills Settlement, subject to further consideration of all the Settlements at the Settlement Hearing to be held before this Court on Datittl, 2009, atio: 00 a.m., at the United States District Court for the Eastern District of Virginia, Alexandria Division, Albert V. Bryan U.S. 5

6 rw` Courthouse, 401 Courthouse Square, Courtroom 7, Alexandria, VA (the "Settlement Hearing"): (a) to determine whether this Action should be finally certified, for settlement purposes, as a class action under Rules 23(a) and (b) of the Federal Rules of Civil Procedure; (b) to determine whether the proposed Mills Settlement, E&Y Settlement and KanAm Settlement, on the terms and conditions provided for in each Settlement's respective Stipulation, is fair, reasonable, and adequate and should be approved by the Court; (c) to determine whether each of the Judgments, as provided for under the respective Stipulations, should be entered dismissing the Settled Claims against the Settling Defendants and the other Released Parties with prejudice as set forth in each of the respective Stipulations; (d) to determine whether the proposed Plan of Allocation is fair and reasonable, and should be approved by the Court; (e) to determine whether and in what amount the Court should award attorneys' fees and reimbursement of expenses to Lead Counsel; and (f) to rule upon such other matters as the Court may deem appropriate. 7. The Court reserves the right to approve each of the Settlements and the proposed Plan of Allocation with or without modification and with or without further notice of any kind. 8. The Court approves the form, substance and requirements of the Notice of Pendency of Class Action, Proposed Settlements and Settlement Fairness Hearing (the "Notice"), and the Proof of Claim Form (the "Claim Form"); and the Summary Notice of Pendency of Class Action, Proposed Settlements and Settlement Fairness Hearing ("Publication Notice") (together the "Settlement Notices"), and finds that the procedures established for publication, mailing and 6

7 distribution of such Settlement Notices substantially in the manner and form set forth in paragraphs 9 and 10 of this Order constitute the best notice practicable under the circumstances and are in full compliance with the notice requirements of due process, Rule 23 of the Federal Rules of Civil Procedure, Section 27 of the Securities Act of 1933, 15 U.S.C. 77z-1(a)(7), as amended by the Private Securities Litigation Reform Act of 1995, and Section 21D(a)(7) of the Securities Exchange Act of 1934, 15 U.S.C. 78u-4(a)(7), as amended by the Private Securities Litigation Reform Act of Lead Counsel shall cause the Notice and Claim Form, substantially in the form annexed hereto as Exhibits 1 and 2, to be mailed, by first-class mail, postage prepaid, on or before twenty-one (21) calendar days from the date of entry of this Order (the "Notice Date"), to all Class Members at the address of each such person or entity, as set forth in the records of Mills or its transfer agent or who otherwise may be identified through reasonable effort. For the purpose of identifying and providing notice to the Class, Mills has provided, or caused to be provided (at its sole cost and expense and at no cost or expense to the Settlement Funds, Plaintiffs' Lead Counsel or the Claims Administrator) its security holder lists (consisting of security holder names and addresses) applicable to purchases of Mills common or preferred stock during the Class Period. Mills shall bear all costs or expenses associated with providing the Claims Administrator with such stock transfer records. Lead Counsel shall, at or before the Settlement Hearing, file with the Court proof of mailing of the Notice. 10. Lead Counsel shall cause the Publication Notice, substantially in the form annexed hereto as Exhibit 3, to be published once each in the national edition of The Wall Street Journal and over the PR Newswire within ten (10) business days of the mailing of the Notice. 7

8 (4") Lead Counsel shall, at or before the Settlement Hearing, file with the Court proof of publication of the Publication Notice. 11. Lead Counsel shall use reasonable efforts to give notice to nominee owners such as brokerage firms and other persons or entities who purchased or otherwise acquired Mills publicly traded common stock and/or preferred stock during the Class Period as record owners but not as beneficial owners. Such nominees who hold or held such Mills common stock and/or preferred stock for beneficial owners who are Class Members are directed either (i) to send a copy of the Notice and Claim Form to the beneficial owner of the shares postmarked no more than fourteen (14) calendar days from the date of receipt of the Notice, or (ii) to provide the names and addresses of such persons no later than fourteen (14) calendar days from the date of receipt of the Notice to the Claims Administrator, c/o The Garden City Group, Inc., at the address specified in the Notice, who shall promptly send a copy of the Notice and Claim Form to each such beneficial owner. Upon full compliance with this Order, such nominees may seek reimbursement of their reasonable expenses actually incurred in complying with this Order by providing the Claims Administrator with proper documentation supporting the expenses for which reimbursement is sought. Such properly documented expenses incurred by nominees in compliance with the terms of this Order shall be paid from the Total Settlement Fund in accordance with the provisions of paragraph 12 below or further Orders of the Court. 12. The Court approves the selection of The Garden City Group, Inc. by Lead Counsel as the Claims Administrator. Lead Counsel may pay from the Mills Settlement Fund, without further approval from the Mills Entities, E&Y, the KanAm Defendants or further order of the Court, all reasonable Notice and Administration Costs actually incurred up to the amount of U.S. $500,000. Subsequent to the Effective Date, such payments may be made from any of 8

9 ("I') the three Settlement Funds at the discretion of Lead Counsel. Such costs and expenses shall include, without limitation, the actual costs of publication, printing and mailing of the Notice and Claim Form, reimbursements to nominee owners for forwarding the Notice and Claim Form to their beneficial owners, the administrative expenses incurred and fees charged by the Claims Administrator in connection with providing Notice and processing the submitted claims, and the fees, if any, of the Escrow Agent. 13. Lead Counsel or their agents are authorized and directed to prepare any tax returns required to be filed for the Settlement Funds and to cause any Taxes due and owing to be paid from the Settlement Funds without further Order of the Court, and to otherwise perform all obligations with respect to Taxes and any reportings or filings in respect thereof as contemplated by each of the Stipulations without further order of the Court. 14. Class Members shall be bound by all determinations and judgments in this Action, whether favorable or unfavorable, unless such persons request exclusion from the Class in a timely and proper manner, as hereinafter provided. A Class Member wishing to make such request shall mail the request in written form by first-class mail to the address designated in the Notice, such that it is received no later than twenty-one (21) calendar days prior to the Settlement Hearing. Such request for exclusion shall clearly indicate the name, address and telephone number of the person seeking exclusion and that the sender requests to be excluded from the Class in the In re The Mills Corporation Securities Litigation, and must be signed by such person. Such persons requesting exclusion are also directed to state: the date(s), price(s), and number(s) of shares of all purchases, acquisitions, and sales of Mills publicly-traded common stock and/or preferred stock during the Class Period. The request for exclusion shall not be 9

10 effective unless it provides the required information and is made within the time stated above, or the request for exclusion is otherwise accepted by the Court. 15. Any Class Member that requests to be and is excluded from the Class shall not be entitled to receive any payment out of the Total Net Settlement Fund, i.e., the Total Settlement Fund less Taxes, Notice and Administration Costs, and attorneys' fees and litigation expenses awarded to counsel representing Lead Plaintiffs and the Class. 16. The Court will consider comments and/or objections to each of the Settlements, the Plan of Allocation, and/or Lead Counsel's application for attorneys' fees and reimbursement of expenses by Class Members only if such comments or objections and any supporting papers are filed in writing with the Clerk of the Court, United States District Court for the Eastern District of Virginia, Alexandria Division, Albert V. Bryan U.S. Courthouse, 401 Courthouse Square, Alexandria VA, 22314, no later than twenty-one (21) calendar days before the Settlement Hearing and copies of all such papers and briefs (which must contain proof of all purchases or other acquisitions and sales of Mills publicly-traded common stock and/or preferred stock during the Class Period) are served, such that they are received no later than twenty-one (21) calendar days before the Settlement Hearing by each of the following: Lead Counsel, Steven B. Singer, Esq., Bernstein Litowitz Berger & Grossmann LLP, 1285 Avenue of the Americas, New York, New York and Jeffrey W. Golan, Esq., Barrack, Rodos & Bacine, 3300 Two Commerce Square, 2001 Market Street, Philadelphia, PA 19103, counsel for the Mills Entities, George H. Mernick, III, Esq., Hogan & Hartson, LLP, th Street, N.W., Washington, D.C , counsel for E&Y, William R. Stein, Esq., Hughes Hubbard & Reed LLP, 1775 I Street, N.W., Washington D.C , and counsel for the KanAm Defendants, Scott B. Schreiber, Esq., Arnold & Porter LLP, th Street, N.W., Washington D.C Attendance at the 10

11 (11PP 14"') hearing is not necessary; however, persons wishing to be heard orally in opposition to the approval of any of the Settlements, the Plan of Allocation and/or Lead Counsel's application for attorneys' fees and reimbursement of expenses are required to indicate in their written objection their intention to appear at the Settlement Hearing. Persons who intend to object to any of the Settlements, the Plan of Allocation and/or Lead Counsel's application for attorneys' fees and reimbursement of expenses and desire to present evidence at the Settlement Hearing must include in their written objections the identity of any witnesses they may call to testify and exhibits they intend to introduce into evidence at the Settlement Hearing. Class Members do not need to appear at the Settlement Hearing or take any other action to indicate their approval. 17. Any Class Member who does not object in the manner prescribed above shall be deemed to have waived such objection and shall forever be foreclosed from making any objection to the fairness, adequacy or reasonableness of each of the Settlements, the Plan of Allocation, Lead Counsel's application for attorneys' fees and reimbursement of expenses or the Judgments to be entered approving each of the respective Settlements. 18. Lead Counsel shall submit their papers in support of final approval of the Settlements by no later than seven (7) calendar days before the Settlement Hearing. 19. The Court expressly reserves the right to adjourn the Settlement Hearing, or any adjournment thereof, without any further notice to Class Members other than an announcement at the Settlement Hearing, or any adjournment thereof, and to approve each of the Stipulations with modification approved by the parties without further notice to Class Members. 20. Neither the Mills Entities, E&Y, the KanAm Defendants, nor any other Released Party shall have any responsibility whatsoever for the Plan of Allocation nor for any application for attorneys' fees or reimbursement of Litigation Expenses submitted by Lead Counsel, and 11

12 (sw'\ such matters will be considered separately from the fairness, reasonableness and adequacy of each of the Settlements. 21. In order to be entitled to participate in the Total Net Settlement Fund, in the event that any or all of the Settlements are effected in accordance with the terms and conditions set forth in the respective Stipulations, each Class Member shall take the following actions and be subject to the following conditions: (a) A properly executed Claim Form, substantially in the form attached hereto as Exhibit 2, must be submitted to the Claims Administrator, at the Post Office Box indicated in the Notice, postmarked not later than one hundred twenty (120) calendar days after the Notice Date. Such deadline may be further extended by Court Order. Each Claim Form shall be deemed to have been submitted when postmarked (if properly addressed and mailed by first class mail, postage prepaid) provided such Claim Form is actually received prior to the motion for an order of the Court approving distribution of the Total Net Settlement Fund. Any Claim Form submitted in any other manner shall be deemed to have been submitted when it was actually received at the address designated in the Notice. (b) The Claim Form submitted by each Class Member must satisfy the following conditions: (i) it must be properly completed, signed and submitted in a timely manner in accordance with the provisions of the preceding subparagraph; (ii) it must be accompanied by adequate supporting documentation for the transactions reported therein, in the form of broker confirmation slips, broker account statements, an authorized statement from the broker containing the transactional information found in a broker confirmation slip, or such other documentation as is deemed adequate by Lead Counsel; 12

13 emk) (iii) if the person executing the Claim Form is acting in a representative capacity, a certification of his/her current authority to act on behalf of the Class Member must be included in the Claim Form; and (iv) the Claim Form must be complete and contain no material deletions or modifications of any of the printed matter contained therein and must be signed under penalty of perjury. (c) As part of the Claim Form, each Class Member shall submit to the jurisdiction of the Court with respect to the claim submitted, and shall (subject to effectuation of any or all of the Settlements) release all Released Claims as provided in the Stipulation(s) for the effected Settlements. 22. Any Class Member who does not timely submit a Claim Form within the time provided for, shall be barred from sharing in the distribution of the proceeds of the Total Settlement Fund, unless otherwise ordered by the Court. 23. Neither the Mills Entities, E&Y, the KanAm Defendants, nor any other Released Party shall have any responsibility whatsoever for the administration of the Settlement or the disbursement of the Total Net Settlement Fund and shall not be permitted to review, contest or object to any Claim Form or any decision of the Claims Administrator or Lead Counsel with respect to accepting or rejecting any Claim Form or Claim for payment by a Class Member except as specifically provided in paragraph 26 of the Stipulations. 24. The Court approves Lead Counsel's selection of Mellon Bank, N.A., a subsidiary of New York Mellon Corporation, as the Escrow Agent for the Settlement Funds pursuant to the terms of the Stipulations. 13

14 25. All funds held in the Escrow Accounts shall be deemed and considered to be in custodia legis and shall remain subject to the jurisdiction of the Court until such time as such funds shall be distributed pursuant to each of the Stipulations and/or further order of the Court. 26. If any Settlement is not approved or consummated for any reason whatsoever, that Settlement and its corresponding Stipulation shall be null and void, and without prejudice, and none of its terms shall be effective or enforceable and the facts of that Settlement shall not be admissible in any trial of this Action, and the applicable Settling Parties shall be deemed to have reverted to their respective status in this Action immediately prior to the date set forth in paragraph 35 of that Stipulation and, except as otherwise expressly provided, the Parties shall proceed in all respects as if that Stipulation and any related orders had not been entered, and any portion of the Settlement Amount previously paid or caused to be paid by the applicable Settling Defendants into an Escrow Account, including, but not limited to, any funds disbursed in payment of Litigation Expenses and attorneys' fees, together with any interest earned or appreciation thereon at the same net rate as earned by that Settlement Fund, less any Taxes paid or due with respect to such interest income and/or appreciation, and, with respect to the Mills Settlement Fund less Notice and Administration Costs actually incurred and paid or payable, shall be returned to the applicable Settling Defendants or their designee(s), as appropriate, within ten (10) business days after written notification of such event by those Settling Defendants to the Lead Counsel. 27. The administration of the proposed Settlements and the determination of all disputed questions of law and fact with respect to the validity of any Claim or right of any person or entity to participate in the distribution of the Total Net Settlement Fund shall be under the authority of this Court. 14

15 / Pending final determination of whether each of the Settlements should be approved, Lead Plaintiffs and all Class Members, and each of them, and anyone who acts or purports to act on their behalf, shall not institute, commence or prosecute any action that asserts any Settled Claims against any of the Released Parties, as defined in each of the Stipulations. 29. The Court retains exclusive jurisdiction over the Action to consider all further matters arising out of or connected with the Settlements. Dated: Alexandria, VA, 2009 /s/ Liam 0 Grady United States District Judge HONORABLE LIAM O'GRADY UNITED STATES DISTRICT JUDGE #

16 EXHIBIT 1

17 UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION IN RE THE MILLS CORPORATION ) CIVIL ACTION NO. SECURITIES LITIGATION ) 1:06-cv (LO-TRJ) ) This Document relates to: ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1 :06-cv (LO/TRJ) ) 1:07-cv (LO/TRJ) ) NOTICE OF PENDENCY OF CLASS ACTION, PROPOSED SETTLEMENTS AND SETTLEMENT FAIRNESS HEARING A Federal Court authorized this Notice. This is not a solicitation from a lawyer. NOTICE OF PENDENCY OF CLASS ACTION: Please be advised that your rights may be affected by a class action lawsuit pending in this Court (the "Consolidated Action" or "Action") if, during the period from February 27, 2001 through and including August 10, 2006, you purchased or otherwise acquired publicly traded common stock and/or preferred stock of The Mills Corporation ("Mills" or the "Company"). NOTICE OF SETTLEMENTS: Please also be advised that the Court-appointed Lead Plaintiffs, Iowa Public Employees' Retirement System ("IPERS") and Public Employees' Retirement System of Mississippi ("MPERS," and together with IPERS, "Lead Plaintiffs"), on behalf of the Class (as defined in paragraph 37 below), have reached the proposed all-cash Settlements with Defendants in the Action, as follows: a settlement with Mills and The Mills Limited Partnership (collectively, the "Mills Entities") in the amount of $165 million, plus interest as described herein (the "Mills Settlement"); a settlement with Ernst & Young LLP ("E&Y") in the amount of $29.75 million (the "E&Y Settlement"); and a settlement with the KanAm Defendants (defined in paragraph 1 below) in the amount of $8 million (the "KanAm Settlement") (collectively, the "Settlements"). The total amount of the Settlements equals $ million, plus interest on the Mills Settlement, as described in paragraphs below. If the Settlements are approved by the Court, they will resolve all claims in the Consolidated Action against the Settling Defendants, as identified in paragraph 1 below, as well as other Released Parties, as identified in paragraph 76 below. This Notice explains important rights you may have, including the possible receipt of cash from the Settlements after the Court approves a Plan of Allocation of the Total Net Settlement Fund (as defined in paragraph 2 below). Your legal rights will be affected whether or not you act. Please read this Notice carefully! i. Description of the Consolidated Action and Class: This Notice relates to three proposed Settlements of claims against the Defendants in the pending class action lawsuit. The Defendants are: (a) the Mills Entities; (b) Laurence C. Siegel, Kenneth R. Parent, Mary Jane Morrow, Nicholas McDonough, James F. Dausch, James C. Braithwaite, Dietrich von Boetticher, Franz Freiherr von Perfall, Joseph B. Gildenhorn, Harry H. Nick, Cristina L. Rose, Robert P. Pincus, John M. Ingram and Charles R. Black, Jr. (the "Individual Defendants"); (c) Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co. Incorporated, Wachovia Capital Markets, EXHIBIT 1

18 KanAm Management L.L.C., KanAm L.L.C., KanAm Providers, Inc., KanAm Realty, Inc., KanAm US, Inc., KanAm America, Inc., KanAm International GmbH, and KanAm Grund Kapitalanlagegessellschaft mbh (the "KanAm Defendants"). The Mills Settlement provides for the release of claims against the Mills Entities, the Individual Defendants, and the Underwriter Defendants, as well as other Released Parties. The E&Y Settlement provides for the release of claims against E&Y as well as other Released Parties related to E&Y. The KanAm Settlement provides for the release of claims against the KanAm Defendants, as well as other Released Parties related to the KanAm Defendants. Thus, the proposed Settlements, if approved by the Court, will resolve all claims and potential claims of Class Members against. all of these Defendants (collectively, the "Settling Defendants") and the other Released Parties, and will provide relief to all persons and entities who purchased or otherwise acquired the publicly traded common stock and/or preferred stock of Mills from February 27, 2001 through August 10, 2006, inclusive (the "Class Period"), and who were injured thereby (the "Class"). 2. Statement of Class's Recovery: Subject to Court approval, and as described more fully in paragraphs below, Lead Plaintiffs, on behalf of the Class, have agreed to settle all claims based on the purchase or acquisition of Mills publicly traded common stock and/or preferred stock that were or could have been asserted against the Settling Defendants and other Released Parties in the Consolidated Action in exchange for a total of at least $ million in cash (the "Total Settlement Amount"), apportioned as: (1) a settlement payment from the Mills Entities of $165 million in cash plus interest in accordance with the schedule described in paragraph 44 below; (2) a settlement payment from E&Y of $29.75 million in cash as described in paragraph 45 below; and (3) a settlement payment from KanAm Services, L.P., on behalf of the KanAm Defendants, of $8 million in cash as described in paragraph 46 below. The Total Settlement Amount will be deposited into interest-bearing escrow accounts (the "Total Settlement Fund"). The Total Net Settlement Fund (the Total Settlement Fund less taxes, notice and administration costs, and attorneys' fees and litigation expenses awarded to counsel representing Lead Plaintiffs and the Class) will be distributed in accordance with a plan of allocation (the "Plan of Allocation") that will be approved by the Court and will determine how the Total Net Settlement Fund shall be allocated to the members of the Class. 3. Statement of Average Amount of Damages Per Share: The parties do not agree on the average amount of damages per share that would be recoverable if Lead Plaintiffs were to prevail. Lead Plaintiffs' damages expert estimates that approximately 55 million of the 56 million shares of Mills publicly traded common stock outstanding and all 25.5 million shares of Mills publicly traded preferred stock outstanding during the Class Period were purchased by Class Members and may have been affected by the conduct at issue in the Consolidated Action. Based on these figures, the average per-share recovery from the Total Settlement Fund would be approximately $3.25 per share of common stock and $0.85 per share of preferred stock before the deduction of attorneys' fees, costs and expenses, as approved by the Court. Class Members should note, however, that these are only estimates based on the overall number of potentially damaged shares in the Class, and that some Class Members may recover more or less than these amounts depending on, among other factors, when and the prices at which their shares were purchased or sold. Settling Defendants deny that any shares of Mills common stock or preferred stock were damaged as Lead Plaintiffs have alleged. Settling Defendants assert that they were prepared to establish that the prices of Mills common stock and preferred stock were not inflated as the result of any allegedly false or misleading public statements by any of the Settling Defendants, or for which any of the Settling Defendants could be held liable, and that the decline in the prices of Mills common and preferred stock alleged in the Consolidated Action did not result from the disclosure of any information that Lead Plaintiffs allege was misrepresented or wrongfully withheld. 4. Statement of Attorneys' Fees and Expenses Sought: Plaintiffs' Counsel have not received any payment of attorneys' fees for their representation of the Class and they have advanced the funds to pay the costs necessarily incurred to prosecute the Consolidated Action. Lead Counsel intend to apply to the Court for an award of attorneys' fees of up to I g % of the Total Settlement Fund, plus expenses not to exceed $4 million, which were incurred in connection with the Action, plus interest. Any fees and expenses awarded by the Court will be paid from the Total Settlement Fund. Class Members are not personally liable for any such fees or expenses. If the Court approves Lead Counsel's request, the estimated average cost will be approximately $ 0.krper affected share of common stock and $ 0./7 per affected share of preferred stock. -2-

19 5. Identification of Attorneys' Representatives: Lead Plaintiffs and the Class are being represented by Steven B. Singer, Esq., of Bernstein Litowitz Berger & Grossmann LLP, and Jeffrey W. Golan, Esq., of Barrack, Rodos & Bacine. Any questions regarding the Settlements should be directed to Mr. Singer at Bernstein Litowitz Berger & Grossmann LLP, 1285 Avenue of the Americas, New York, NY 10019, (800) , blbablbglaw.com, or to Mr. Golan at Barrack Rodos & Bacine, 3300 Two Commerce Square, 2001 Market Street, Philadelphia, PA 19103, (215) , YOUR LEGAL RIGHTS AND OPTIONS IN THE SETTLEMENTS: SUBMIT A CLAIM FORM BY, This is the only way you will be eligible to get a payment from the Total Net Settlement Fund. EXCLUDE YOURSELF FROM THE CLASS If you exclude yourself from the Class, you will not be BY SUBMITTING A WRITTEN REQUEST eligible to get any payment from the Total Net Settlement FOR EXCLUSION SO THAT IT IS RECEIVED Fund. However, excluding yourself from the Class NO LATER THAN allows you to bring your own lawsuit against any of the Settling Defendants or other Released Parties concerning the claims that were, or could have been, asserted in this case. OBJECT TO THE SETTLEMENTS, THE If you do not like the Mills Settlement, the E&Y PLAN OF ALLOCATION OR THE FEE AND Settlement, the KanAm Settlement, the Plan of EXPENSE REQUEST BY SUBMITTING Allocation, and/or Lead Counsel's fee and expense WRITTEN OBJECTIONS SO THAT THEY request, you may write to the Court and explain why you ARE RECEIVED NO LATER THAN, do not like them. You cannot object to any of the Settlements, the Plan of Allocation or the fee and expense request unless you are a Class Member and do not exclude yourself. GO TO THE HEARING ON, 2009 AT Filing a written objection by, 2009, allows, AND FILE A NOTICE OF you to present your objection about any of the issues to be INTENTION TO APPEAR SO THAT IT IS decided by the Court at the hearing. RECEIVED NO LATER THAN, DO NOTHING. If you do not submit a claim form, you will not be eligible to receive a payment from the Total Net Settlement Fund. However, unless you exclude yourself from the Class, you will lose any right to bring your own lawsuit against any of the Defendants or Released Parties concerning the claims that were, or could have been, asserted in the Action. WHAT THIS NOTICE CONTAINS Why Did I Get This Notice? What Is This Case About? What Has Happened So Far? How Do I Know If I Am Affected By The Settlements? What Are The Lead Plaintiffs' Reasons For The Settlements? What Might Happen If There Were No Settlements? How Much Will My Payment Be? What Rights Am I Giving Up By Remaining In The Class? Page Page Page Page Page Page Page - 3 -

20 What Payment Are The Attorneys For The Class Seeking? How Will The Lawyers Be Paid? Page How Do I Participate In The Settlements? What Do I Need To Do? Page What If I Do Not Want To Be A Part Of The Settlements? How Do I Exclude Myself? Page When And Where Will The Court Decide Whether To Approve The Settlements, Plan of Allocation and Fee and Expense Request? Do I Have To Come To The Hearing? May I Speak At The Hearing If I Don't Like The Settlements? Page What If I Bought Shares On Someone Else's Behalf? Page Can I See The Court File? Whom Should I Contact If! Have Questions? Page WHY DID I GET THIS NOTICE? 6. This Notice is being sent to you pursuant to an Order of the United States District Court for the Eastern District of Virginia, Alexandria Division (the "Court") because you or someone in your family or an investment account for which you serve as a custodian may have purchased or otherwise acquired publicly traded shares of Mills common stock and/or preferred stock during the Class Period. The Court has directed us to send you this Notice because, as a potential Class Member, you have a right to know about your options before the Court rules on each of the three proposed Settlements of this case. Additionally, you have the right to understand how a class action lawsuit may generally affect your legal rights. If the Court approves the Settlements and the Plan of Allocation (or some other plan of allocation), the claims administrator selected by Lead Plaintiffs and approved by the Court will make payments pursuant to the Settlements after any objections and appeals are resolved. 7. In a class action lawsuit, the Court selects one or more people, known as class representatives, to sue on behalf of all people with similar claims, commonly known as the class or the class members. In this Consolidated Action, the Court has appointed IPERS and MPERS to serve as "Lead Plaintiffs" under a federal law governing lawsuits such as this one, and approved Lead Plaintiffs' selection of the law firms of Barrack, Rodos and Bacine and Bernstein Litowitz Berger & Grossmann LLP (together "Lead Counsel") to serve as Lead Counsel in the Consolidated Action. A class action is a type of lawsuit in which the claims of a number of individuals are resolved together, thus providing the class members with both consistency and efficiency. Once the class is certified, the Court must resolve all issues on behalf of the class members, except for any persons who choose to exclude themselves from the class. (For more information on excluding yourself from the Class, please read "What If I Do Not Want To Be A Part Of The Settlements? How Do 1 Exclude Myself?," located below.) 8. The Court in charge of this case is the United States District Court for the Eastern District of Virginia, Alexandria Division, and the case is known as In re The Mills Corporation Securities Litigation. The Judge presiding over this case is the Honorable Liam O'Grady, United States District Judge. The people who are suing are called plaintiffs, and those who are being sued are called defendants. In this case, the plaintiffs are referred to as the Lead Plaintiffs, on behalf of themselves and the Class, and Defendants are the Mills Entities, the Individual Defendants, the Underwriter Defendants, E&Y and the KanAm Defendants. The three proposed Settlements will resolve all claims against all Defendants and will bring the Consolidated Action to an end. 9. This Notice explains the lawsuit, the Settlements, your legal rights, what benefits are available, who is eligible for them, and how to get them. The purpose of this Notice is to inform you of this case, that it is a class action, how you might be affected, and how to exclude yourself from the Class if you wish to do so. It also is being sent to inform you of the terms of the three proposed Settlements, and of a hearing to be held by the Court to consider the fairness, reasonableness, and adequacy of the three proposed Settlements (the "Settlement Hearing"). to. The Settlement Hearing will be held on Orloboir a, 2009 at i0 :00AINefore the Honorable Liam O'Grady, at the United States District Court for the Eastern District of Virginia, Alexandria Division, Albert V. Bryan U.S. Courthouse, 401 Courthouse Square, Courtroom 7, Alexandria, VA to determine: (i) whether this Consolidated Action should be finally certified, for settlement purposes only, as a class action under Rules 23(a) and (b) of the Federal Rules of Civil Procedure; -4-

21 rifts) (ii) whether the proposed Settlements are fair, reasonable, and adequate and should be approved by the Court; (iii) whether the Settled Claims against the Settling Defendants and the other Released Parties should be dismissed with prejudice as set forth in the Stipulations and Agreements of Settlement (the "Stipulations"); (iv) whether the proposed Plan of Allocation is fair and reasonable, and should be approved by the Court; and (v) whether and in what amount the Court should award attorneys' fees and reimbursement of expenses to Lead Counsel. i. This Notice does not express any opinion by the Court concerning the merits of any claim in the Consolidated Action, and the Court still has to decide whether to approve each of the Settlements. If the Court approves the Settlements and a Plan of Allocation, payments to Authorized Claimants will be made after any appeals are resolved and after the completion of all claims processing. Please be patient. WHAT IS THIS CASE ABOUT? WHAT HAS HAPPENED SO FAR? 12.During th e Class Period, Mills was a real estate investment trust. 13.L ead Plaintiffs alleged that during the Class Period, Mills issued financial statements that materially overstated Mills' actual financial results starting with the year-end 2000 results through the third quarter 2005 results, which caused Mills publicly traded common stock and preferred stock to be sold at artificially inflated prices. 14Ḷ cad Plaintiffs further alleged that Mills engaged in accounting improprieties in order to be able to report financial results that met or exceeded the market's expectations. 15. On January 6, 2006, the Company filed a Form 8-K with the SEC announcing that the Company would restate its audited financial results from 2000 through 2004 and its unaudited quarterly results for the first three quarters of On August 10, 2006, the Company filed a Form 8-K with the SEC reporting the results of its Audit Committee's investigation into Mills' accounting practices to that point, which disclosed, among other things, that Mills' shareholders' equity was overstated as of September 30, 2005, and that it had overstated net income for 2003, 2004 and On January 9, 2007, the Company filed a Form 8-K with the SEC that provided further detail about the findings made as a result of the Audit Committee's investigation. 16.Be ginning on or about January 20, 2006, four class actions were commenced in the United States District Court for the Eastern District of Virginia (the "Securities Class Actions") against certain of the Settling Defendants. The complaints in those actions alleged, inter alia, that certain of the Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 promulgated thereunder, and Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 ("Securities Act"). 17.On March 31, 2006, the Court entered an Order consolidating the Securities Class Actions into the Consolidated Action. By Order entered June 1, 2006, the Court appointed IPERS and MPERS as Lead Plaintiffs in the Consolidated Action. On December 22, 2006, and March 27, 2007, two additional class actions were commenced in the same court against E&Y and certain other Defendants. Under the Court's previous order, these cases were consolidated with the previously filed actions. 18.On July 27, 2007, Lead Plaintiffs filed the Consolidated Class Action Complaint (the "Consolidated Complaint") asserting claims under Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder and Sections 11, 12(a)(2) and 15 of the Securities Act. The Consolidated Complaint generally alleged violations of the federal securities laws through, among other things, misstatements and omissions by the Mills Entities, E&Y and certain other former defendants and Defendants in filings made by Mills and Mills LP with the United States Securities and Exchange Commission (the "SEC"), as well as in press releases and conference calls with analysts and investors. As to the KanAm Defendants named in the Consolidated Complaint, that complaint -5-

22 (oft) alleged that they were liable solely by virtue of their alleged control of the Mills Defendants and certain Mills directors. The Consolidated Complaint sought to proceed on behalf of a class consisting of all persons who purchased or otherwise acquired Mills publicly traded securities, including Mills common stock and preferred stock, during the period from February 27, 2001 through August 10, 2006 and who retained the securities through October 31, 2005, and who were damaged thereby, excluding certain named persons and entities. The dates for the Class Period were chosen based on Lead Plaintiffs' determination of when misleading public statements began to artificially inflate the value of Mills publicly traded securities and when the truth concerning those statements became known and the artificial inflation was eliminated from the price of Mills publicly traded securities. Lead Plaintiffs determined that, in order to be deemed to have suffered a recognizable loss, persons who purchased or otherwise acquired Mills publicly traded common stock and preferred stock during the Class Period must have retained their securities through October 31, 2005 because, among other reasons, that was the date of a Mills press release that said the Company was delaying the release of its results for the third quarter of 2005 to allow the Company additional time to evaluate the accounting for several items in its third quarter results. 19.On September 13-14, 2007, the persons and entities named as defendants in the Consolidated Complaint filed thirteen (13) separate motions to dismiss the Consolidated Complaint; on October 29, 2007, Lead Plaintiffs filed an omnibus memorandum in opposition to those motions to dismiss; and on November 19, 2007, reply briefs were filed in support of the motions. By Order entered December 7, 2007, the Court granted the motions to dismiss but granted Lead Plaintiffs leave to replead by January 18, On January 18, 2008, Lead Plaintiffs filed their Consolidated Amended Class Action Complaint (the "Consolidated Amended Complaint"), asserting claims under Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder and Sections 11 and 15 of the Securities Act. The Consolidated Amended Complaint generally alleges violations of the federal securities laws through, among other things, misstatements and omissions by Defendants in filings made by Mills and Mills LP with the SEC, as well as in press releases and conference calls with analysts and investors. 21.On February 22-25, 2008, the persons and entities named as defendants in the Consolidated Amended Complaint filed motions to dismiss the Consolidated Amended Complaint; on March 21, 2008, Lead Plaintiffs filed an omnibus memorandum in opposition to the motions to dismiss; and on April 4, 2008, reply briefs were filed in support of the motions. By Order entered April 28, 2008, the Court denied the motions to dismiss in their entirety. On May 9, 2008, the persons and entities named as defendants in the Consolidated Amended Complaint filed their respective Answers to the Consolidated Amended Complaint. 22.On August 15, 2008, Lead Plaintiffs filed their motion (i) to certify the Action as a class action, (ii) to certify Lead Plaintiffs and additional named plaintiffs including C. Bickley Foster, Frederic Elliott and Vernon E. Rudolph as Class Representatives, and (iii) to certify Lead Counsel as Class Counsel (the "Class Motion"). The Parties to the Action engaged in discovery pertaining to the Class Motion, including discovery of experts proffered by Lead Plaintiffs and Defendants, and submitted memoranda of law and exhibits, including expert affidavits and testimony, in response to and in further support of the Class Motion. 23.On November. 12, 2008, after representatives for Lead Plaintiffs and representatives for the Mills Entities engaged in day-long mediation sessions on April 2, 2008, July 23, 2008 and November 10, 2008, before former Judge Daniel Weinstein, Lead Plaintiffs and the Mills Entities reached an agreement in principle with respect to a compromise and settlement of the claims raised in the Action against the Mills Entities, the Individual Defendants and the Underwriter Defendants. This settlement was reached only after extended arm's length negotiations under the auspices of Judge Weinstein and after Lead Plaintiffs' Class Motion was fully briefed and pending before the Court. Lead Plaintiffs, however, continued to prosecute the remaining claims against E&Y and the KanAm Defendants named in the Consolidated Amended Complaint. 24.On January 9, 2009, Lead Plaintiffs filed a motion to amend the Consolidated Amended Complaint, substituting certain of the KanAm Defendants in place of the Defendants previously named in the Consolidated Complaint and Consolidated Amended Complaint (the "Motion to Amend"). Attached to Lead Plaintiffs' submission was a copy of Lead Plaintiffs' proposed Second Amended Class Action Complaint (the "Second -6-

23 ,41" ri*5b) Amended Complaint") which asserted claims against the KanAm Defendants based solely on their alleged control of the Mills Defendants and certain Mills directors. 25.On January 15, 2009, the KanAm Defendants filed a motion seeking a limited and partial discovery stay (the "Stay Motion"). Then, on February 4, 2009, the KanAm Defendants filed an opposition to the Motion to Amend and a motion to dismiss the proposed Second Amended Complaint should the Court grant leave for the Second Amended Complaint to be filed, to which Lead Plaintiffs responded in a brief filed on February 5, On February 6, 2009, the Court heard argument on Lead Plaintiffs' Motion to Amend, as well as the KanAm Defendants' Stay Motion. Thereafter, on February 9, 2009, the Court entered an order granting the Motion to Amend and denying the Stay Motion. 27.On February 26, 2009, the Court heard argument on the Class Motion as against E&Y and the KanAm Defendants, and stated at the conclusion of the Hearing that (a) Lead Plaintiffs had met their burden to establish the appropriateness of certifying a Class through August 10, 2006, and (b) the Court would grant the Class Motion and issue an order and memorandum opinion consistent with the Court's findings. 28.On February 27, 2009, the Court heard argument on the KanAm Defendants' motion to dismiss the Second Amended Complaint, and stated that the Court would issue an order denying the KanAm Defendants' motion. Thereafter, on March 3, 2009, the Court entered an order denying the KanAm Defendants' motion to dismiss the Second Amended Complaint. On March 13, 2009, the KanAm Defendants filed their Answer to Lead Plaintiffs' Second Amended Complaint. 29.On March 18, 2009, E&Y and the KanAm Defendants filed in the United States Court of Appeals for the Fourth Circuit (the "Court of Appeals") Petitions for Permission to Appeal from the Court's ruling on the Class Motion, to which Lead Plaintiffs responded on March 20, 2009, with a motion to dismiss the Petitions and on March 30, 2009, with a brief in opposition to the Petitions. 30, On March 20, 2009, E&Y filed a motion in the Court to stay certain proceedings in the litigation pending determination by the Court of Appeals of E&Y's Rule 23(f) Petition, Lead Plaintiffs' response to the stay motion was to be filed on April 1, 2009, E&Y could file a reply brief on April 2, 2009, and argument was set on the motion for April 3, On March 31, 2009, the Court issued an Order granting the Class Motion, finding that, as to E&Y and the KanAm Defendants, Lead Plaintiffs had demonstrated the existence of the prerequisites for class certification articulated in Fed. R. Civ. P. 23(a) and 23(b)(3). The Order specifically certified as to E&Y a subclass of persons who purchased or otherwise acquired Mills common and preferred stock during the period from March 28, 2002 through August 10, 2006, and certified as to the KanAm Defendants a subclass of persons who purchased or otherwise acquired Mills common and preferred stock during the period from February 27, 2001 through August 10, On April 1, 2009, after representatives for Lead Plaintiffs and representatives for E&Y had engaged in mediation sessions before Judge Weinstein on December 8, 2008 and March 13, 2009, and through a series of further discussions, the parties reached an agreement in principle with respect to a compromise and settlement of the claims raised in the Action against E&Y. This settlement was reached only after extended arm's length negotiations under the auspices of Judge Weinstein and follow-up discussions directly between Lead Counsel and counsel for E&Y, and through Judge Weinstein. Lead Plaintiffs and E&Y provided notice to the Court of the Settlement, including that in light of the Settlement, E&Y would be withdrawing its motion to stay proceedings in the Court, and that it would be taking action before the Court of Appeals to seek deferral of proceedings in the Court of Appeals on E&Y's Rule 23(f) Petition, and otherwise to protect its appeal rights, pending final approval of the Settlement. On April 2, 2009, E&Y filed a notice of withdrawal of its motion to stay proceedings referred to above. Lead Plaintiffs, however, continued to prosecute the remaining claims against the KanAm Defendants. 33.On Ma y 7, 2009, the KanAm Defendants filed an Amended Rule 23(f) Petition in the Court of Appeals. -7-

24 34.On May 11, 2009, after representatives for Lead Plaintiffs and representatives for the KanAm Defendants engaged in mediation sessions before Judge Weinstein on December 10, 2008 and April 14, 2009, and through a series of further discussions, the parties reached an agreement in principle with respect to a compromise and settlement of the claims raised in the Action against the KanAm Defendants. This settlement was reached only after extended arm's length negotiations under the auspices of Judge Weinstein and follow-up discussions directly between Lead Counsel and counsel for the KanAm Defendants, and through Judge Weinstein, ultimately culminating in a mediator's proposal. Lead Plaintiffs and the KanAm Defendants provided notice to the Court of the Settlement, including that in light of the Settlement, the KanAm Defendants would be taking action before the Court of Appeals to seek deferral of proceedings in the Court of Appeals on KanAm's Amended Rule 23(f) Petition, and otherwise to protect their appeal rights, pending final approval of the Settlement. 35.L cad Counsel conducted an extensive investigation and thorough discovery relating to the claims and the underlying events and transactions alleged in the Consolidated Complaint, the Consolidated Amended Complaint and the Second Amended Complaint, which included reviewing millions of pages of documents produced by Defendants and other non-parties; conducting interviews with potential fact witnesses; responding to discovery requests, including interrogatories and document requests, addressed to the Lead Plaintiffs and other Plaintiffs; participating in depositions of representatives of each of the Lead Plaintiffs, other Plaintiffs and an investment manager for the Lead Plaintiffs; completing briefing and expert discovery related to Lead Plaintiffs' motion for class certification, including presenting and reviewing expert reports, and participating in expert depositions; taking depositions of more than 25 fact witnesses; preparing for depositions of the Individual Defendants, other former employees of Mills, other representatives of the KanAm Defendants and of the Underwriter Defendants; and working with Lead Plaintiffs' experts in the preparation of expert reports. Lead Counsel have analyzed the evidence adduced during pretrial discovery and have researched the applicable law with respect to the claims of Lead Plaintiffs and the other members of the Class against the Defendants and the potential defenses thereto. 36.On March 4, 2009, the Court entered an order preliminarily approving the Mills Settlement. On, 2009, the Court entered the Order for Notice and Hearing which, among other things, (a) preliminarily approved the E&Y and KanAm Settlements, (b) authorized this Notice to be sent to potential Class Members, and (c) scheduled the Settlement Hearing to consider whether to grant final approval to each of the Settlements. HOW DO I KNOW IF I AM AFFECTED BY THE SETTLEMENTS? 37.I f you are a member of the Class, you are subject to each of the Settlements unless you timely request to be excluded. The Class consists of all persons or entities who during the period from February 27, 2001 through August 10, 2006 purchased or otherwise acquired Mills publicly traded common stock and preferred stock and who were damaged thereby. This includes purchasers of Mills common stock and purchasers of Mills preferred stock, Series B, C, E and G. Excluded from the Class are (a) Defendants and all persons and entities who (i) during the Class Period were Defendants' officers, directors and partners or members of Defendants' immediate families or controlled by a Defendant or (ii) at any time, were Defendants' legal representatives, heirs, successors or assigns and assert a claim on the Total Settlement Fund based on a Defendant's purchase or other acquisition of Mills publicly traded common stock or preferred stock, and (b) persons who purchased and sold all of their Mills securities before the close of the market on October 31, As explained above, Lead Plaintiffs determined that purchasers of Mills publicly traded common stock and preferred stock must have retained their securities through October 31, 2005 because, among other reasons, that was the date of a Mills press release that said the Company was looking into certain "accounting issues" relating to its third quarter 2005 financial statements. The Class also does not include those persons and entities who timely request exclusion from the Class pursuant to this Notice (see "What If I Do Not Want To Participate In The Class And The Settlement? How Do I Exclude Myself?," below). RECEIPT OF THIS NOTICE DOES NOT NECESSARILY MEAN THAT YOU ARE A CLASS MEMBER OR THAT YOU WILL BE ENTITLED TO RECEIVE PROCEEDS FROM THE -8-

25 r4") SETTLEMENTS. IF YOU WISH TO BE ELIGIBLE TO PARTICIPATE IN THE DISTRIBUTION OF PROCEEDS FROM THE SETTLEMENTS, YOU WILL BE REQUIRED TO SUBMIT THE CLAIM FORM THAT IS BEING DISTRIBUTED WITH THIS NOTICE. WHAT ARE THE LEAD PLAINTIFFS' REASONS FOR THE SETTLEMENTS? 38.L ead Plaintiffs and Lead Counsel believe that the claims asserted against the Settling Defendants have merit. Lead Plaintiffs and Lead Counsel recognize, however, the expense and length of continued proceedings necessary to pursue their claims against these Defendants through trial and appeals, as well as the difficulties in establishing liability for allegations of fraud. Lead Plaintiffs and Lead Counsel have taken into account the possibility that the claims asserted in the Consolidated Amended Complaint and Second Amended Complaint might have been dismissed in response to the Settling Defendants' anticipated motions for summary judgment, and have considered issues that would have been decided by a jury in the event of a trial of the Consolidated Action, including whether any of the Settling Defendants acted with an intent to mislead investors, whether the alleged misrepresentations or omissions were material to investors, whether all of Class Members' losses were caused by the alleged misrepresentations or omissions, and the amount of damages. Lead Plaintiffs and Lead Counsel have considered the uncertain outcome and trial risk in complex lawsuits like this one, and that, even if they were successful, after the resolution of appeals that were certain to be taken (which could take years to resolve), certain of the Settling Defendants may not have been able to pay an amount significantly larger than the Total Settlement Amount or even as much as the Total Settlement Amount. Settling Defendants' ability to pay an amount significantly larger than the Total Settlement Amount, or even as much as the Total Settlement Amount, years into the future when all appeals were resolved was also a factor that Lead Plaintiffs took into account, including the risk that insurance coverage provided by the directors' and officers' policies would be seriously depleted, if not exhausted, by the continuing costs of litigation. 39.L ead Plaintiffs and Lead Counsel believe that each of the Settlements achieved with the Settling Defendants is an excellent result and in the best interests of the Class and, therefore, agreed to the terms of each of the proposed Settlements. 40. I n light of the amount of each of the Settlements, that the Settling Defendants agreed to certification of the Class for settlement purposes, and the immediacy of recovery to the Class, Lead Plaintiffs and Lead Counsel believe that each of the proposed Settlements is fair, reasonable and adequate, and in the best interests of the Class. Lead Plaintiffs and Lead Counsel believe that each of the Settlements provides a substantial benefit now, namely $165 million in cash, plus interest, for the Mills Settlement, $29.75 million in cash for the E&Y Settlement, and $8 million in cash for the KanAm Settlement (less the various deductions described in this Notice), as compared to the risk that the claims in the Consolidated Action would produce a similar, smaller, or no recovery after summary judgment, trial and appeals, possibly years in the future. 41.Settling Defendants have denied the claims asserted against them in the Consolidated Action and deny having engaged in any wrongdoing or violation of law of any kind whatsoever. Settling Defendants have agreed to each of the Settlements solely to eliminate the burden and expense of continued litigation. Accordingly, each of the Settlements may not be construed as an admission of any Settling Defendant's wrongdoing. WHAT MIGHT HAPPEN IF THERE WERE NO SETTLEMENTS? 42.I f there were no Settlements and Lead Plaintiffs failed to establish any essential legal or factual element of their claims against any of the Settling Defendants and other defendants who are included in the definition of Released Parties (see paragraph 76 below), neither Lead Plaintiffs nor the Class would recover anything from those Settling Defendants and those Released Parties. Also, if any of the Settling Defendants or any of the other Released Parties were successful in proving any of their defenses, the Class likely might recover substantially less than the amount provided in each of the Settlements, or nothing at all. Finally, the Class had not yet been certified in litigation as against the Mills Entities, the Individual Defendants, and the Underwriter Defendants, and the other -9-

26 (1". elmt Settling Defendants may have prevailed on appeal on their arguments as to why the Class should not have been certified at all or in its entirety, which would also have seriously undermined Lead Plaintiffs' ability to achieve a meaningful result for the Class through litigation of the Consolidated Action. HOW MUCH WILL MY PAYMENT BE? 43.At this time, it is not possible to make any determination as to how much a Class Member may receive from any of the Settlements. 44.Pursuant to the Mills Settlement, the Mills Entities have agreed to pay or cause to be paid the amount of One Hundred Sixty-Five Million Dollars ($165,000,000) in cash plus interest in accordance with the following schedule: (a) Sixty-Five Million Dollars ($65,000,000) within fifteen (15) business days after the Court enters the Order for Notice and Hearing with respect to the Mills Settlement (the "First Payment"), plus such additional amount as will equal three percent (3%) simple annual interest accrued on the Sixty-Five Million Dollars over the course of the period from February 1, 2009 until said deposit is made; (b) Fifty Million Dollars ($50,000,000) on or before April 15, 2009 (the "Second Payment"), plus such additional amount as will equal three percent (3%) simple annual interest accrued on the Fifty Million Dollars over the course of the period from February 1, 2009 until deposit into the Escrow Account of the Second Payment; and (c) Fifty Million Dollars ($50,000,000) on or before July 31, 2009 (the "Third Payment"), plus such additional amount as will equal three percent (3%) simple annual interest accrued on the Fifty Million Dollars over the course of the period from February 1, 2009 until deposit into the Escrow Account of the Third Payment. The parties also agreed that the Mills Entities may, in their sole discretion, pay or cause to be paid, either or both of the Second Payment and Third Payment prior to the dates set forth above for their payment (the "Early Payment(s)"), provided that any such Early Payment(s) shall also include such additional amount as will equal three percent (3%) simple annual interest accrued on the Early Payments(s) over the course of the period from February 1, 2009 until deposit into the Escrow Account of the Early Payment(s). Furthermore, in order to assure the payment of the Second and Third Payments, the Mills Entities have delivered to Lead Counsel irrevocable letters of credit for the aggregate amount of One Hundred Million Dollars ($100,000,000). The Mills Entities have made the first and second payments identified above, equaling $100,000,000 plus interest. The Mills Entities' obligation to make the third payment, which is not due until July 31, 2009, remains secured by the irrevocable letter of credit described above. 45.Pursuant to the E&Y Settlement, E&Y agreed to pay or cause to be paid the amount of Twenty-Nine Million Seven-Hundred Fifty Thousand Dollars ($29,750,000) by depositing that amount in cash into an Escrow Account within fifteen (15) business days after the Court enters the Order for Notice and Hearing. 46.Pursuant to the KanAm Settlement, on May 29, 2009, KanAm Services, L.P. on behalf of the Settling KanAm Defendants, deposited Eight Million Dollars ($8,000,000) in cash into an Escrow Account. 47.The aggregate total of all three Settlements is referred to as the "Total Settlement Amount" and together with any and all income earned thereon is referred to as the "Total Settlement Fund." The Total Net Settlement Fund is the Total Settlement Fund less (i) all federal, state and local taxes on any income earned by the Total Settlement Fund and the reasonable costs incurred in connection with determining the amount of, and paying, taxes owed by the Total Settlement Fund (including reasonable expenses of tax attorneys and accountants); (ii) the costs and expenses in connection with providing Notice to Class Members and administering the Settlements on behalf of Class Members; and (iii) any award by the Court of attorneys' fees and expenses. The Total Net Settlement Fund shall be distributed to Class Members who submit acceptable Proofs of Claim ("Authorized Claimants"). -10-

27 eft>) PROPOSED PLAN OF ALLOCATION GENERAL PROVISIONS 48.Defend ants have agreed to pay or cause to be paid a Total Settlement Amount of $ million in cash plus interest, as set forth above. 49.After approval of the Settlements by the Court and upon satisfaction of the other conditions to the Settlements, the Total Net Settlement Fund (i.e., the Total Settlement Amount plus interest, and less all taxes, approved costs, fees and expenses) shall be distributed to Class Members (or the representative of such Class Members including, without limitation, agents, administrators, executors, heirs, predecessors, successors, affiliates (as defined in 17 C.F.R. Part b) and assigns) who submit a Proof of Claim in such form and manner, and within such time, as the Court shall prescribe that are allowed by the Court ("Authorized Claimants") in accordance with the Plan of Allocation. If any funds remain in the Total Net Settlement Fund because of uncashed distributions or other reasons, then, after the Claims Administrator has made reasonable and diligent efforts to have Authorized Claimants cash their distribution checks, any balance remaining in the Total Net Settlement Fund one (1) year after the initial distribution of such funds shall be redistributed to Class Members who have cashed their initial distribution and who would receive at least $10.00 from such redistribution, after payment of any unpaid costs or fees incurred in administering the Total Net Settlement Fund for such redistribution. If any funds shall remain in the Total Net Settlement Fund six (6) months after such redistribution, then such balance shall be contributed to non-sectarian, not-for-profit 501(c)(3) organizations designated by Lead Counsel after notice to the Court and subject to direction, if any, by the Court. 50.The Court has reserved the right to modify the Plan of Allocation without further notice to Class Members. All Orders regarding a modification of the Plan of Allocation will be posted on the settlement website, wvvw..com. 51.The following proposed Plan of Allocation reflects Lead Plaintiffs' contention, on behalf of themselves and the Class, that because of misrepresentations and omissions about Mills' financial condition and prospects, the prices of Mills common and preferred stock were artificially inflated during the Class Period (February 27, 2001 August 10, 2006). Defendants do not admit that Lead Plaintiffs' contentions, damages analysis or calculations as stated or reflected herein are correct as a matter of fact or law, but for purposes of the Settlements have taken no position with respect to this Plan of Allocation. 52.The objective of the Plan of Allocation is to equitably distribute the settlement proceeds to those Class Members who suffered economic losses as a result of the alleged fraud, as opposed to losses caused by market or industry factors or other non-fraud-related, Company-specific factors. The Plan of Allocation reflects Lead Plaintiffs' damages expert's analysis undertaken to that end. 53.A "Recognized Loss Amount" will be calculated for each purchase or acquisition of publicly traded common stock and/or preferred stock of Mills that is listed in the Claim Form, and for which adequate documentation is provided. The calculation of the Recognized Loss Amount will depend upon several factors, including (i) when the shares were purchased or acquired and (ii) whether they were held through the conclusion of the Class Period or sold during the Class Period, and if so, when they were sold. 54.Recognized Loss Amounts are based on the level of alleged artificial inflation in the price of Mills common stock and preferred stock at the time of purchase or acquisition. For losses to be compensable damages under the federal securities laws, the disclosure of the allegedly misrepresented information must be the cause of the decline in the price of the stock. In this case, Lead Plaintiffs allege that Defendants made false statements and omitted material facts from February 27, 2001 through and including August 10, As noted in its 8-K filed August 10, 2006, Mills admitted to overstating shareholders' equity by at least $295 million and net income by $55 million in 2003, $95 million in 2004, and $60 million in the first nine months of Therefore, inflation was assumed to have entered the stock proportionately to the overstatements. For example, in 2003, when income was said to have been overstated by $55 million, the Plan reflects that 18.7% ($55 million / $295 million) of the total inflation entered the securities' prices during The inflation was assumed -11-

28 (4'w\ f'"""f',1 to have entered evenly throughout the four earnings announcements during the year, so that 4.7% (18.7% / 4) entered each time Mills released its earnings for the 2003 fiscal quarters. Similar calculations, based on the figures contained in the 8-K filed August 10, 2006, were made with respect to the presumed inflation that entered the stock during the other years within the Class Period. 56.Artificial inflation in the prices of Mills Securities was determined to be at its maximum just prior to the first partially corrective disclosure on October 31, 2005, after which changes in inflation were measured based on observed returns following disclosures of inflationary or corrective information. Following the final corrective disclosure at the end of the Class Period, artificial inflation was eliminated from the prices of Mills Securities. 57.The Recognized Loss Amounts are based on the timing of trades in Mills common and/or preferred stock relative to these alleged corrective disclosure dates. 58.The Claims Administrator shall determine each Authorized Claimant's pro rata share of the Total Net Settlement Fund, i.e., the Distribution Amount, based upon each Authorized Claimant's "Recognized Claim" as defined in paragraph 61 below. The formulas set forth below for determining a Recognized Claim are not intended to be an estimate of the amount that a Class Member might have been able to recover after a trial; nor is the Recognized Claim an estimate of the amount that will be paid to Authorized Claimants pursuant to the Settlements. The formulas are the basis upon which the Distribution Amount will be proportionately allocated to the Authorized Claimants. SPECIFIC LOSS AMOUNTS 59.The Recognized Loss Amount is based on the per share amount of alleged artificial inflation present in the price of Mills common stock and preferred stock as set forth in Appendices A I that appear at the end of this Notice. A. MILLS COMMON STOCK (i) For each share of Mills common stock purchased or otherwise acquired during the Class Period that a Claimant sold prior to November 1, 2005, the Claimant shall have no Recognized Loss Amount. (ii) For each share of Mills common stock purchased or otherwise acquired during the Class Period, which a Claimant sold between November 1, 2005 and the close of trading on August 11, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the proceeds received on sale per share (excluding commissions) or (b) the difference between the estimated per share inflation in the price of Mills common stock on the purchase date (see Appendix A) and the estimated per share inflation in the price of Mills common stock on the date of sale (see Appendix A). (iii) For each share of Mills common stock purchased or otherwise acquired during the Class Period, which a Claimant sold from August 12, 2006 through November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the price per share on the sale date listed in Appendix B or (b) the estimated per share inflation in the price of Mills common stock on the purchase date (see Appendix A). (iv) For each share of Mills common stock purchased or otherwise acquired during the Class Period, which a Claimant beneficially owned as of the close of trading on November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and $17.19 per share or (b) the estimated per share inflation in the price of Mills common stock on the purchase date (see Appendix A). -12-

29 (11") B. MILLS SERIES B PREFERRED STOCK (1) For each share of Mills Series B Preferred stock purchased or otherwise acquired during the Class Period that a Claimant sold prior to November 1, 2005, the Claimant shall have no Recognized Loss Amount. (ii) For each share of Mills Series B Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant sold between November 1, 2005 and the close of trading on August 11, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the proceeds received on sale per share (excluding commissions) or (b) the difference between the estimated per share inflation in the price of Mills Series B Preferred stock on the purchase date (see Appendix C) and the estimated per share inflation in the price of Mills Series B Preferred stock on the date of sale (see Appendix C). (iii) For each share of Mills Series B Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant sold from August 12, 2006 through November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the price per share on the sale date listed in Appendix D or (b) the estimated per share inflation in the price of Mills Series B Preferred stock on the purchase date (see Appendix C). (iv) For each share of Mills Series B Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant beneficially owned as of the close of trading on November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and $21.63 per share or (b) the estimated per share inflation in the price of Mills Series B Preferred stock on the purchase date (see Appendix C). C. MILLS SERIES C PREFERRED STOCK (i) For each share of Mills Series C Preferred stock purchased or otherwise acquired during the Class Period that a Claimant sold prior to November 1, 2005, the Claimant shall have no Recognized Loss Amount. (ii) For each share of Mills Series C Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant sold between November 1, 2005 and the close of trading on August 11, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the proceeds received on sale per share (excluding commissions) or (b) the difference between the estimated per share inflation in the price of Mills Series C Preferred stock on the purchase date (see Appendix E) and the estimated per share inflation in the price of Mills Series C Preferred stock on the date of sale (see Appendix E). (iii) For each share of Mills Series C Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant sold from August 12, 2006 through November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the price per share on the sale date listed in Appendix F or -13-

30 (b) the estimated per share inflation in the price of Mills Series C Preferred stock on the purchase date (see Appendix E). (iv) For each share of Mills Series C Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant beneficially owned as of the close of trading on November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and $21.51 per share or (h) the estimated per share inflation in the price of Mills Series C Preferred stock on the purchase date (see Appendix E). D. MILLS SERIES E PREFERRED STOCK (i) For each share of Mills Series E Preferred stock purchased or otherwise acquired during the Class Period that a Claimant sold prior to November 1, 2005, the Claimant shall have no Recognized Loss Amount. (ii) For each share of Mills Series E Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant sold between November 1, 2005 and the close of trading on August 11, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the proceeds received on sale per share (excluding commissions) or (b) the difference between the estimated per share inflation in the price of Mills Series E Preferred stock on the purchase date (see Appendix G) and the estimated per share inflation in the price of Mills Series E Preferred stock on the date of sale (see Appendix G). (iii) For each share of Mills Series E Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant sold from August 12, 2006 through November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the price per share on the sale date listed in Appendix H or (b) the estimated per share inflation in the price of Mills Series E Preferred stock on the purchase date (see Appendix G). (iv) For each share of Mills Series E Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant beneficially owned as of the close of trading on November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and $21.05 per share or (b) the estimated per share inflation in the price of Mills Series E Preferred stock on the purchase date (see Appendix G). E. MILLS SERIES G PREFERRED STOCK (I) For each share of Mills Series G Preferred stock purchased or otherwise acquired during the Class Period that a Claimant sold prior to November 1, 2005, the Claimant shall have no Recognized Loss Amount. (ii) For each share of Mills Series G Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant sold between November 1, 2005 and the close of trading on August 11, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the proceeds received on sale per share (excluding commissions) or -14-

31 rlron, (b) the difference between the estimated per share inflation in the price of Mills Series G Preferred stock on the purchase date (see Appendix I) and the estimated per share inflation in the price of Mills Series G Preferred stock on the date of sale (see Appendix I). (iii) For each share of Mills Series G Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant sold from August 12, 2006 through November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and the price per share on the sale date listed in Appendix J or (b) the estimated per share inflation in the price of Mills Series G Preferred stock on the purchase date (see Appendix I). (iv) For each share of Mills Series G Preferred stock purchased or otherwise acquired during the Class Period, which a Claimant beneficially owned as of the close of trading on November 8, 2006, the Recognized Loss Amount per share shall be equal to the lesser of (a) the difference between the purchase price paid per share (excluding commissions) and $19.97 per share or (b) the estimated per share inflation in the price of Mills Series G Preferred stock on the purchase date (see Appendix I). ADDITIONAL PROVISIONS 60.The Total Net Settlement Fund will be allocated among all Authorized Claimants, provided, however, that Class Members who purchased Mills stock prior to March 28, 2002 will not be allocated any money from the E&Y Settlement with respect to those purchases. That is because any federal securities claims against E&Y that could have been asserted on behalf of persons who purchased Mills stock prior to March 28, 2002 were barred by the statute of limitations, and the Court's class certification decision therefore specifically certified as to E&Y a subclass of persons who purchased or otherwise acquired Mills stock during the period from March 28, 2002 through August 10, Class Members who purchased Mills stock prior to March 28, 2002 will be allocated money from the settlements with the Mills Defendants and the KanAm Defendants with respect to those purchases, provided that those purchases are otherwise eligible for compensation pursuant to the terms of the Plan of Allocation. 61.Each Authorized Claimant's Recognized Claim shall be the total of his, her or its Recognized Loss Amounts. If the sum total of Recognized Claims of all Authorized Claimants who are entitled to receive payment out of the Total Net Settlement Fund is greater than the Total Net Settlement Fund, however, each such Authorized Claimant shall receive his, her, or its pro rata share of the Total Net Settlement Fund. The pro rata share shall be the Authorized Claimant's Recognized Claim divided by the total of all Recognized Claims to be paid from the Total Net Settlement Fund, multiplied by the total amount in the Total Net Settlement Fund. 62.I f the Total Net Settlement Fund exceeds the sum total amount of the Recognized Claims of all Authorized Claimants entitled to receive payment out of the Total Net Settlement Fund, the excess amount in the Total Net Settlement Fund shall be distributed pro rata to all Authorized Claimants entitled to receive payment. 63.For Class Members who (a) held Mills common stock before the Class Period or (b) made multiple purchases/acquisitions or sales of Mills common stock and/or preferred stock during the Class Period, the first-in, first-out ("FIFO") method will be applied to such holdings, purchases and sales for purposes of calculating Recognized Loss Amounts. Class Period sales will be matched first against the Mills shares held at the beginning of the Class Period, and then against purchases/acquisitions of the security in chronological order, beginning with the earliest purchase/acquisition made during the Class Period. 64.A purchase or acquisition and sale of Mills common stock or preferred stock shall be deemed to have occurred on the "contract" or "trade" date as opposed to the "settlement" or "payment" date. The receipt or grant by gift, inheritance or operation of law of Mills common stock or preferred stock during the Class Period shall not -15-

32 fisfik) be deemed a purchase, acquisition or sale of these shares of Mills common stock or preferred stock for the calculation of a Claimant's Recognized Claim nor shall the receipt or grant be deemed an assignment of any claim relating to the purchase/acquisition of such shares of Mills common stock or preferred stock unless (i) the donor or decedent purchased or otherwise acquired such shares of Mills stock during the Class Period; (ii) no Claim Form was submitted by or on behalf of the donor, on behalf of the decedent, or by anyone else with respect to such shares of Mills stock; and (iii) the assignment of claims is specifically so provided in the instrument of gift or assignment. 65.The date of covering a "short sale" is deemed to be the date of purchase or acquisition of Mills common stock and preferred stock. The date of a "short sale" is deemed to be the date of sale of Mills common stock or preferred stock. In accordance with the Plan of Allocation, however, the Recognized Loss Amount on "short sales" is zero. 66.To the extent a Claimant had a market gain from his, her, or its overall transactions in Mills common stock and preferred stock during the Class Period, the value of the Recognized Claim will be zero. To the extent that a Claimant suffered an overall market loss on his, her, or its overall transactions in Mills common stock and preferred stock during the Class Period, but that market loss was less than the total Recognized Claim calculated above, then the Claimant's Recognized Claim shall be limited to the amount of the actual market loss. 67.For purposes of determining whether a Claimant had a market gain from his, her, or its overall transactions in Mills common stock and preferred stock during the Class Period or suffered a market loss, the Claims Administrator shall determine the difference between (i) the Total Purchase Amount' and (ii) the sum of the Sales Proceeds2 and the Holding Value. 3 This difference will be deemed a Claimant's market gain or loss on his, her, or its overall transactions in Mills common stock and preferred stock during the Class Period. 68.The Plan of Allocation set forth herein is the plan that is being proposed by Lead Plaintiffs and Lead Counsel to the Court for approval. The Court may approve this plan as proposed or it may modify the Plan of Allocation without further notice to the Class. 69. T he Total Net Settlement Fund will not be distributed until the Court has approved a plan of allocation, and the time for any petition for rehearing, appeal or review, whether by certiorari or otherwise, has expired. 70.Each of th e Settling Defendants is not entitled to get back any portion of the respective Settlement Amounts once the Court's Order approving the respective Settlement applicable to that Settling Defendant becomes final. 71.The Court has reserved jurisdiction to allow, disallow or adjust the Claim of any Class Member on equitable grounds. 72.Approval of each of the Settlements is independent from approval of each of the other Settlements and approval of the proposed Plan of Allocation. 73.Onl y those Class Members who purchased or otherwise acquired Mills publicly traded common stock and/or preferred stock during the Class Period AND WERE DAMAGED AS A RESULT OF SUCH PURCHASES OR ACQUISITIONS, will be eligible to share in the distribution of the Total Net Settlement The "Total Purchase Amount" is the total the amount the Claimant paid for all of the Mills common stock and preferred stock purchased or acquired during the Class Period. 2 The Claims Administrator shall match any sales of Mills common stock during the Class Period, first against the Claimant's opening position in the stock (the proceeds of those sales will not be considered for purposes of calculating market gains or losses). The total amount received for sales of the remaining Mills common stock sold through and including August 11, 2006 is the "Sales Proceeds." The Claims Administrator shall perform the same procedure with respect to each series of preferred stock. 3 The Claims Administrator shall ascribe a value per share for the number of shares of Mills common and preferred stock purchased or acquired during the Class Period and still held as of the close of business on August 11, 2006 ("Holding Value") as follows: (i) $17.19 per share of common stock; (ii) $21.63 per share of Series B Preferred Stock; (iii) ) $21.51 per share of Series C Preferred Stock; (iv) ) $21.05 per share of Series E Preferred Stock; and (v) ) $19.97 per share of Series G Preferred Stock. -16-

33 ("!! Fund. Each person wishing to participate in the distribution will be required to timely submit a valid Claim Form establishing membership in the Class, and including all required documentation. WHAT RIGHTS AM I GIVING UP BY REMAINING IN THE CLASS? 74.I f you remain in the Class, you will be bound by any orders issued by the Court. For example, if any of the Settlements are approved, the Court will enter judgment as to the approved Settlement or Settlements (the "Judgment"). The Judgment will dismiss with prejudice the claims against the respective Settling Defendants and will provide that Lead Plaintiffs and all other Class Members shall be deemed to have -- and by operation of the Judgment shall have fully, finally, and forever released, waived, discharged, and dismissed any and all Settled Claims (as defined in paragraph 75 below), including Unknown Claims (as defined in the Stipulations) against the respective Released Parties (as defined in paragraph 76 below) and any claims or potential claims that were or could be asserted in connection with the Consolidated Action or the Settled Claims. 75."Settled Claims" means any and all actions, claims, debts, demands, rights or causes of action or liabilities whatsoever (including, but not limited to, any claims for damages, interest, attorneys' fees, expert or consulting fees, and any other costs, expenses or liability whatsoever), whether based on federal, state, local, or foreign statutory or common law or any other law, rule or regulation, whether fixed or contingent, accrued or unaccrued, liquidated or unliquidated, at law or in equity, matured or unmatured, whether class, derivative or individual in nature, including both known claims and Unknown Claims, (i) that have been asserted in this Action by the Class Members or any of them against any of the Released Parties, or (ii) that could have been asserted in any forum by the Class Members or any of them against any of the Released Parties which in any way arise out of, are related to, or are based upon (a) the allegations, transactions, facts, matters or occurrences, representations or omissions involved, set forth, or referred to in the Consolidated Complaint, the Consolidated Amended Complaint or any subsequent amendment of the Amended Complaint (including the Second Amended Complaint) or (b) investments (including, but not limited to, purchases or other acquisitions, sales, exercises, and decisions to hold) in any securities issued by, or instruments referencing securities issued by, Mills or Mills LP, including without limitation all claims arising out of or relating to any disclosures, public filings, registration statements or other statements by any and all of the Former Defendants (as defined in the Stipulations) and Defendants. 76."Released Parties" or "Released Party" means, (1) as to the Mills Settlement, any and all of the Settling Mills Defendants (as defined in the Mills Settlement Stipulation), the Purchasers (as defined in the Mills Settlement Stipulation), the Settling Underwriter Defendants (as defined in the Mills Settlement Stipulation) and any other person or entity who acted as an underwriter for the offering of Mills Series G preferred stock; (2) as to the E&Y Settlement, Settling Defendant E&Y (as defined in the E&Y Settlement Stipulation); and (3) as to the KanAm Settlement, the Settling KanAm Defendants (as defined in the KanAm Settlement Stipulation). In addition, each of the Settlements also releases various Released Parties, which generally include each of the Settling Defendants' respective past and present subsidiaries, divisions, business units, parents, successors and predecessors, legal representatives, heirs, assigns, partners, principals, members, managers, officers, directors, agents, employees, attorneys, affiliates, controlled persons, controlling persons, insurers, advisors, investment advisors, and other released parties as described therein.4 77.An y Judgment entered by the Court will also provide that the respective Settling Defendants, on behalf of themselves and all other applicable Released Parties, their heirs, executors, administrators, predecessors, successors and assigns, and any other person claiming by, through or on behalf of them, shall be deemed to have and by operation of the Judgment shall have full y, finally, and forever released, waived, discharged and dismissed all claims, debts, demands, rights or causes of action or liabilities whatsoever (including, but not limited to, any claims for damages, interest, attorneys' fees, expert or consulting fees, and any other costs expenses or liability whatsoever) against any of the Lead Plaintiffs, Class Members or Plaintiffs' Counsel, whether based on 4 The definitions of Released Parties, as set forth in the respective Stipulations, are set forth in their entirety in the accompanying Proof of Claim form. -17-

34 federal, state, local, statutory or common law or any other law, rule or regulation, whether fixed or contingent, accrued or unaccrued, liquidated or unliquidated, at law or in equity, matured or =matured, whether class or individual in nature, including both known claims and Unknown Claims, that have been or could have been asserted in the Consolidated Action or any forum by the respective Settling Defendants or any of them or the successors and assigns of any of them, that arise from or relate to the institution, prosecution, or settlement of the Action (except for claims to enforce the Stipulation and Settlement). 78. An y Judgment entered by the Court will also provide for the following: (a) A "Bar Order" that permanently bars, enjoins and restrains any and all claims for contribution, or any indemnity claim or any other claim, however styled, where the injury to the claiming party is the claiming party's purported liability to the Class or any Class Member, arising out of, relating to or based upon the claims, allegations, transactions, facts, matters or occurrences, representations or omissions, involved, set forth, or referred to in the Complaint or the Amended Complaint or any subsequent amendment thereto (including but not limited to the Settled Claims), whether arising under state, federal or foreign statutory or common-law rule, asserted as claims, cross-claims, counterclaims, or third-party claims, in this Action, any federal or state court, or in any other court, arbitration proceeding, administrative agency, or other domestic or foreign forum (i) by any person or entity against any of the respective Released Parties and (ii) by any of the respective Released Parties against any person or entity. Any final verdict or judgment that might be obtained by or on behalf of the Class or a Class Member against any person or entity whose claims are barred pursuant to the foregoing, apart from the respective Released Parties, shall be reduced by the greater of (i) the respective Settlement Amount or (ii) an amount that corresponds to the percentage of responsibility of the respective Released Parties as determined at trial; and (b) A "Released Parties Bar Order" that permanently bars, enjoins and restrains all respective Released Parties from commencing, instituting or prosecuting any or all claims, debts, demands, rights or causes of action or liabilities whatsoever (including, but not limited to, any claims for damages, interest, attorneys' fees, expert or consulting fees, and any other costs expenses or liability whatsoever) against any of the Lead Plaintiffs, Class Members or Plaintiffs' Counsel, whether based on federal, state, local, statutory or common law or any other law, rule or regulation, whether fixed or contingent, accrued or unaccrued, liquidated or unliquidated, at law or in equity, matured or unmatured, whether class or individual in nature, including both known claims and unknown claims, that have been or could have been asserted in the Action or any forum by the respective Released Parties or any of them or the successors and assigns of any of them, that arise from or relate to the institution, prosecution, or settlement of the Action through the Effective Date (except for claims to enforce this Stipulation and Settlement) n addition, in any Judgment entered by the Court with respect to the Mills Settlement, the Bar Order shall not include all claims that may be brought against the Mills Released Parties by the Mills Entities, or any designee of the Mills Entities who contributes funds to the Mills Settlement Fund. WHAT PAYMENT ARE THE ATTORNEYS FOR THE CLASS SEEKING? HOW WILL THE LAWYERS BE PAID? 80. Plaintiffs' Counsel have not received any payment for their services in pursuing claims against Defendants on behalf of the Class, nor have they been reimbursed for /heir out-of-pocket expenses. Lead Counsel intends to apply to the Court for an award of attorneys' fees of up to I g% of the Total Settlement Fund, plus expenses not to exceed $4 million, which were incurred in connection with the Action, plus interest. Any fees and expenses awarded by the Court will be paid from the Total Settlement Fund. Class Members are not personally liable for any such fees or expenses. 81. Plaintiffs' Counsel will only be paid if, after submission of their fee and expense request, the Court awards a fee to Plaintiffs' Counsel and grants reimbursement of their litigation expenses. Any amount awarded by the Court as fees and expenses would be paid from the Total Settlement Fund, as described in paragraph

35 (4"' toa" 82.Additional] y, the Plaintiffs in this Action incurred certain expenses in connection with their service as Class representatives. They are also applying to the Court for reimbursement of those expenses, not to exceed $125,000, which, if granted, would also be paid from the Total Settlement Fund. HOW DO I PARTICIPATE IN THE SETTLEMENTS? WHAT DO I NEED TO DO? 83.1 f you purchased or otherwise acquired Mills publicly traded common stock and/or preferred stock during the period from February 27, 2001 through August 10, 2006, inclusive, and were damaged thereby, and you are not excluded by the definition of the Class and you do not elect to exclude yourself from the Class, then you are a Class Member, and you will be bound by any of the proposed Settlements that the Court approves, and by any judgment or determination of the Court affecting the Class. Only Class Members are eligible to participate in the distribution of the Total Net Settlement Fund and, if you are a Class Member, you are required to submit a Claim Form and supporting documentation to establish your entitlement to share in the Settlements. The Claim Form, attached hereto, can also be downloaded from the website maintained by the Claims Administrator for the Settlement or you may request that a Claim Form be mailed to you. The website is The Claim Form will also be available from Lead Counsel's websites at and Those who exclude themselves from the Class, and those who do not submit timely and valid Claim Forms with adequate supporting documentation will not be entitled to share in the Settlements. 84.As a Class Member, you are represented by Lead Plaintiffs and Lead Counsel, unless you enter an appearance through counsel of your own choice at your own expense. You are not required to retain your own counsel, but if you choose to do so, such counsel must file a notice of appearance on your behalf and must serve copies of his or her notice of appearance on the attorneys listed in the section entitled, "When and Where Will the Court Decide Whether to Approve the Settlements?," below. 85. I f you do not wish to remain a Class Member, you may exclude yourself from the Class by following the instructions in the section entitled, "What If I Do Not Want To Be A Part Of The Class And The Settlements? How Do I Exclude Myself?," below. 86. I f you wish to object to the Mills Settlement, the E&Y Settlement, the KanAm Settlement, the proposed Plan of Allocation, Lead Counsel's request for attorneys' fees and reimbursement of expenses, or any portions of the above Settlements, Plan or fee and expense request, and if you do not exclude yourself from the Class, you may present your objections by following the instructions in the section entitled, "When and Where Will the Court Decide Whether to Approve the Settlements, Plan of Allocation and Fee and Expense Request?," below. WHAT IF I DO NOT WANT TO BE A PART OF THE SETTLEMENTS? HOW DO I EXCLUDE MYSELF? 87.Each Class Member will be bound by all determinations and judgments in this lawsuit, including those concerning each of the Settlements, whether favorable or unfavorable, unless such person or entity mails, by firstclass mail (or its equivalent outside the U.S.), or otherwise delivers a written Request for Exclusion from the Class, addressed to In re The Mills Corporation Securities Litigation - EXCLUSIONS, - do The Garden City Group, Inc., P.O. Box. The exclusion request must be received no later than, You will not be able to exclude yourself from the Class after that date. Each Request for Exclusion must (i) state the name and address of the person or entity requesting exclusion; (ii) state that such person or entity "requests exclusion from the Class in In re The Mills Corporation Securities Litigation, Civil Action No. 1:06-cv (LO-TRJ)"; (iii) be signed by the person or entity requesting exclusion; (iv) provide a telephone number for that person or entity; and (v) provide the date(s), price(s), and number(s) of shares of all purchases, acquisitions, and sales of Mills publicly traded common stock and/or preferred stock during the Class Period. Requests for exclusion will not be valid if they do not include the information set forth above and are not received within the time stated above, unless the Court otherwise determines. 88. I f you do not want to be part of the Class, you must follow these instructions for exclusion even if you have pending, or later file, another lawsuit, arbitration, or other proceeding relating to any Settled Claims. -19-

36 r1" rom 89.1 f a person or entity requests to be excluded from the Settlement Class, that person or entity will not receive any benefit provided for in any of the Stipulations. WHEN AND WHERE WILL THE COURT DECIDE WHETHER TO APPROVE THE SETTLEMENTS, PLAN OF ALLOCATION AND FEE AND EXPENSE REQUEST? DO I HAVE TO COME TO THE HEARING? MAY I SPEAK AT THE HEARING IF I DON'T LIKE THE SETTLEMENTS? 90.If you do not wish to object in person to the proposed Mills Settlement, E&Y Settlement, KanAm Settlement, Plan of Allocation or fee and expense request, you do not need to attend the Settlement Hearing. You can object to or participate in each of the Settlements, or object to the Plan of Allocation or fee and expense request without attending the Settlement Hearing. 91.The Settlement Hearing will be held on, 2009 at before the Honorable Liam O'Grady, at the United States District Court for the Eastern District of Virginia, Alexandria Division, Albert V. Bryan U.S. Courthouse, 401 Courthouse Square, Courtroom 7, Alexandria, VA The Court reserves the right to approve each of the Settlements, the Plan of Allocation, or the fee and expense request at or after the Settlement Hearing without further notice to the members of the Class. 92.An y Class Member who does not request exclusion received no later than, 2009 may object to the Mills Settlement, the E&Y Settlement, the KanAm Settlement, the Plan of Allocation or the fee and expense request. Objections or oppositions must be in writing. You must file any written objection or opposition, together with copies of all other papers (including proof of all purchases or acquisitions of Mills publicly traded common stock and/or preferred stock during the Class Period) and briefs, with the Clerk's Office at the United States District Court for the Eastern District of Virginia at the address set forth below on or before, You must also serve the papers on Lead Counsel for the Class and Counsel for the Settling Defendants at the addresses set forth below so that the papers are received on or before, Lead Counsel for the Class UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA BERNSTEIN LITOWITZ BERGER ALEXANDRIA DIVISION & GROSSMANN LLP Clerk of the Court Steven B. Singer, Esq. Albert V. Bryan U.S. Courthouse 1285 Avenue of the Americas 401 Courthouse Square New York, NY Alexandria, VA and BARRACK, RODOS & BACINE Counsel for the Mills Entities Jeffrey W. Golan, Esq Two Commerce Square HOGAN 8c HARTSON LLP 2001 Market Street George H. Memick, III, Esq. Philadelphia, PA th Street, N.W. Washington, D.C

37 elok) Counsel for E&Y Counsel for the KanAm Defendants HUGHES HUBBARD & REED LLP ARNOLD & PORTER LLP William R. Stein, Esq. Scott B. Schreiber, Esq I Street, N.W th Street, N.W. Washington, DC Washington, DC The filing must demonstrate your membership in the Class, including the number of shares of Mills publicly traded common stock and/or preferred stock purchased or otherwise acquired or sold during the Class Period and the price(s) paid and received. You may not object to any of the Settlements, the Plan of Allocation or the fee and expense request, or any aspect of them, if you excluded yourself from the Class or if you are not a member of the Class. 94.You may file a written objection without having to appear at the Settlement Hearing. However, you may not appear at the Settlement Hearing to present your objection unless you first have filed and served a written objection in accordance with the procedures described above, unless the Court orders otherwise. 95.I f you wish to be heard orally at the hearing in opposition to the approval of the Mills Settlement, the E8cY Settlement, the KanAm Settlement, the Plan of Allocation or the fee and expense request, and if you have filed and served a timely written objection as described above, you also must notify the above counsel on or before, 2009 concerning your intention to appear. Persons who intend to object and desire to present evidence at the Settlement Hearing must include in their written objections the identity of any witnesses they may call to testify and the exhibits they intend to introduce into evidence at the hearing. 96.You are not required to hire an attorney to represent you in making written objections or in appearing at the Settlement Hearing. If you decide to hire an attorney, which will be at your own expense, however, he or she must file a notice of appearance with the Court and serve it on Lead Counsel and counsel for the Settling Defendants so that the notice is received on or before The Settlement Hearing may be adjourned by the Court without further written notice to the Class. If you intend to attend the Settlement Hearing, you should confirm the date and time with Lead Counsel. Unless the Court orders otherwise, any Class Member who does not object in the manner described above will be deemed to have waived any objection and shall be forever foreclosed from making any objection to any of the proposed Settlements, the Plan of Allocation, and the fee and expense request. Class Members do not need to appear at the hearing or take any other action to indicate their approval. WHAT IF I BOUGHT SHARES ON SOMEONE ELSE'S BEHALF? 98.1 f you purchased or otherwise acquired Mills publicly traded common stock and/or preferred stock during the Class Period for the beneficial interest of a person or organization other than yourself, you must either (i) send a copy of this Notice and the Claim Form to the beneficial owner of such Mills securities, postmarked no later than fourteen (14) days after you receive this Notice and the Claim Form, or (ii) provide the names and addresses of such persons no later than fourteen (14) days after you receive this Notice to In re The Mills Corporation Securities Litigation, do The Garden City Group, Inc., P.O. Box. If you choose the second option, the Claims Administrator will send a copy of the Notice and Claim Form to the beneficial owner. Upon full compliance with these directions, such nominees may seek reimbursement of their reasonable expenses actually incurred, by providing the Claims Administrator with proper documentation supporting the expenses for which reimbursement is sought. Copies of this Notice and the Claim Form may also be obtained from the Claims Administrator's website or by calling toll-free , or from Lead Counsel's websites, and

38 (4'` (1') CAN I SEE THE COURT FILE? WHOM SHOULD I CONTACT IF I HAVE QUESTIONS? 99. This Notice contains only a summary of the terms of the proposed Settlements. All inquiries concerning this Notice should be directed to: In re The Mills Corporation Securities Litigation c/o The Garden City Group, Inc. P.O. Box 800- and/or Steven B. Singer, Esq. Jeffrey W. Golan, Esq. BERNSTEIN LITOWITZ BERGER BARRACK, RODOS & BACINE & GROSSMANN LLP 3300 Two Commerce Square 1285 Avenue of the Americas 2001 Market Street New York, NY Philadelphia, PA (800) (215) blbg blbglaw.com jgolan@barrack.com DO NOT CALL OR WRITE THE COURT OR THE OFFICE OF THE CLERK OF COURT REGARDING THIS NOTICE. Dated:, 2009 By Order of the Clerk of Court United States District Court for the Eastern District of Virginia Alexandria Division ii

39 Appendix A Estimated Per Share Inflation in Mills Corp Common Stock February 27, August 11, 2006 Date Inflation Date Inflation 2/27/01-5/15/01 $ /3/04-11/8104 $ /16/01-8/8/01 $ /9/04-3/22/05 $ /9/01. 11/11/01 $ /23/05-5/5/05 $ /12/01-2/27/02 $ /6/05-8/4/05 $ /28/02-5/9/02 $ /5/05-10/31/05 $ /10/02-8/11/02 $ /1/05-11/8/05 $ /12/02-11/3/02 $ /9/2005 $ /4/02-2/20/03 $ /10/05-1/6/06 $ /21/03-5/8/03 $ /9/06-2/23/06 $ /9/03-8/12/03 $ /24/06-3/17/06 $ /13/03-11/4/03 $ /20/06-3/22/06 $ /5/03-2/16/04 $ /23/06-4/11/06 $ /17/04-4/29/04 $ /12/06-8/10/06 $ /30/04-8/2/04 $ /11/06 and After $ - Appendix B Statutory Sale Prices for Mills Common Stock During the 90-Day Period Following the Class Period August 11, November 8, 2006 Date Price Date Price Date Price 8/11/2006 $ /18/2006 $ /23/2006 $ /14/2006 $ /19/2006 $ /24/2006 $ /15/2006 $ /20/2006 $ /25/2006 $ /16/2006 $ /21/2006 $ /26/2006 $ /17/2006 $ /22/2006 $ /27/2006 $ /18/2006 $ /25/2006 $ /30/2006 $ /21/2006 $ /26/2006 $ /31/2006 $ /22/2006 $ /27/2006 $ /1/2006 $ /23/2006 $ /28/2006 $ /2/2006 $ /24/2006 $ /29/2006 $ /3/2006 $ /25/2006 $ /2/2006 $ /6/2006 $ /28/2006 $ /3/2006 $ /7/2006 $ /29/2006 $ /4/2006 $ /8/2006 $ /30/2006 $ /5/2006 $ /31/2006 $ /6/2006 $ /1/2006 $ /9/2006 $ /5/2006 $ /10/2006 $ /6/2006 $ /11/2006 $ /7/2006 $ /12/2006 $ /8/2006 $ /13/2006 $ /11/2006 $ /16/2006 $ /12/2006 $ /17/2006 $ /13/2006 $ /18/2006 $ /14/2006 $ /19/2006 $ /15/2006 $ /20/2006 $ 16.90

40 Date Inflation 10/9/02-11/3/02 $ /02-2/20/03 $ /21/03-5/8/03 $ /9/03-8/12/03 $ /13/03-11/4/03 $ /03-2/16/04 $ /17/04-4/29/04 $ /30/04-8/2/04 $ /3/04-11/8/04 $ /9/04-3/22/05 $ /23/05-5/5/05 $ /6/05-8/4/05 $ /5/05-10/31/05 $ /1/05-1/6/06 $ /9/06-2/23/06 $ /24/06-3/17/06 $ /06-4/11/06 $ /12/06-8/10/06 $ /11/06 and After $ - Appendix C Estimated Per Share Inflation in Mills Corp Series B Preferred Stock October 14, August 11, 2006 Appendix D Statutory Sale Prices for Mills Series B Preferred Stock During the 90-Day Period Following the Class Period August 11, November 8, 2006 Date Price Date Price Date Price 8/11/2006 $ /18/2006 $ /16/2006 $ /14/2006 $ /19/2006 $ /17/2006 $ /15/2006 $ /20/2006 $ /18/2006 $ /16/2006 $ /21/2006 $ /19/2006 $ /17/2006 $ /22/2006 $ /20/2006 $ /18/2006 $ /25/2006 $ /23/2006 $ /21/2006 $ /26/2006 $ /24/2006 $ /22/2006 $ /27/2006 $ /25/2006 $ /23/2006 $ /28/2006 $ /26/2006 $ /24/2006 $ /29/2006 $ /27/2006 S /25/2006 $ /2/2006 $ /30/2006 $ /28/2006 $ /3/2006 $ /31/2006 $ /29/2006 $ /4/2006 $ /1/2006 $ /30/2006 $ /5/2006 $ /2/ /31/2006 $ / $ /3/2006 $ /1/2006 $ /9/2006 $ /6/2006 $ /5/2006 $ /10/2006 $ /7/2006 $ /6/2006 $ /11/2006 $ /8/2006 $ /7/2006 $ /12/2006 $ /8/2006 $ /13/2006 $ /11/2006 $ /12/2006 $ /13/2006 $ / $ /15/2006 $ 21.48

41 (411 /411k) Date Inflation 12/17/02-2/20/03 $ / /8/03 $ /9/03-8/12/03 $ /13/03-11/4/03 $ /5/03-2/16/04 $ /17/04-4/29/04 $ /30/04-8/2/04 $ /3/04-11/8/04 $ /9/04-3/22/05 $ /23/05-5/5/05 $ /6/05-8/4/05 $ /5/05-10/31/05 $ /1/05-2/23/06 $ /24/06-3/17/06 $ /20/06-3/22/06 $ /23/06-4/11/06 S /12/06-8/10/06 $ /11/06 and After $ - Appendix E Estimated Per Share Inflation in Mills Corp Series C Preferred Stock January 17, August 11, 2006 Appendix F Statutory Sale Prices for Mills Series C Preferred Stock During the 90-Day Period Following the Class Period August II, November 8, 2006 Date Price Date Price Date Price 8/11/2006 $ /12/2006 $ /11/2006 $ /14/2006 $ /13/2006 $ /12/2006 $ /15/2006 $ /14/2006 $ /13/2006 $ /16/2006 $ /15/2006 $ /16/2006 $ /17/2006 $ /18/2006 $ /17/2006 $ /18/2006 $ /19/2006 $ /18/2006 $ /21/2006 $ /20/2006 $ /19/2006 $ /22/2006 $ /21/2006 $ /20/2006 $ /23/2006 $ /22/2006 $ /23/2006 $ /24/2006 $ /25/2006 $ /24/2006 $ /25/2006 $ /26/2006 $ /25/2006 $ /28/2006 $ /27/2006 $ /26/2006 $ /29/2006 $ /28/2006 $ /27/2006 $ /30/2006 $ /29/2006 $ /30/2006 $ /31/2006 $ /2/2006 $ /31/2006 $ /1/2006 $ /3/2006 $ /1/2006 $ /5/2006 $ /4/2006 $ /2/2006 $ /6/2006 $ /5/2006 $ /3/2006 $ /7/2006 $ /6/2006 $ / $ /8/2006 $ /9/2006 $ /7/2006 $ /11/2006 $ /10/2006 $ /8/2006 $ 21.51

42 (17"\ elm) Date Inflation 5/5/03-5/8/03 $ /9/03-8/12/03 $ / /4/03 $ /5/03-2/16/04 $ /17/04-4/29/04 $ /30/04-8/2/04 $ /3/04-11/8/04 $ /9/04-3/22/05 $ /23/05-5/5/05 $ /6/05-8/4/05 $ /5/05-10/31/05 $ /1/05-11/8/05 $ /9/ /6/06 $ /9/06-2/23/06 $ /24/06-3/17/06 $ /20/06-3/22/06 $ /23/06-4/11/06 $ /12/06-8/10/06 $ /11/06 and After S - Appendix G Estimated Per Share Inflation in Mills Corp Series E Preferred Stock May 27, August 11, 2006 Appendix H Statutory Sale Prices for Mills Series E Preferred Stock During the 90-Day Period Following the Class Period August 11, November 8, 2006 Date Price Date Price Date Price 8/11/2006 $ /15/2006 $ /19/2006 $ /14/2006 $ /18/2006 $ /20/2006 $ /15/2006 $ /19/2006 $ /23/2006 $ /16/2006 $ /20/2006 $ /24/2006 $ /17/2006 $ /21/2006 $ /25/2006 $ /18/2006 $ /22/2006 $ /26/ /21/2006 $ /25/2006 $ /27/2006 S /22/2006 $ /26/ /30/2006 $ /23/2006 $ /27/2006 $ /31/2006 $ /24/2006 $ /28/2006 $ /1/2006 $ /25/2006 $ /29/2006 $ /2/2006 $ /28/ /2/2006 $ /3/2006 $ /29/2006 $ /3/2006 $ /6/2006 $ /30/2006 $ /4/2006 $ /7/2006 $ /31/2006 $ /5/2006 $ /8/2006 $ /1/2006 $ /6/2006 $ /5/2006 $ /9/2006 $ /6/2006 $ /10/2006 $ /7/2006 $ /11/2006 $ /8/2006 $ /12/2006 $ /11/2006 $ /13/2006 $ /12/2006 $ /16/2006 $ /13/2006 $ /17/2006 $ /14/2006 $ /18/2006 $ 20.84

43 /47"\ rart'\ Appendix I Estimated Per Share Inflation in Mills Corp Series G Preferred Stock May 24, August 11, 2006 Date Inflation 5/17/05-8/4/05 $ /5/05-10/31/05 $ /1/ /05 $ /9/2005 $ /10/05-1/6/06 $ /06-2/23/06 $ /24/06-3/17/06 $ /20/06-4/11/06 $ /12/06-8/10/06 $ /11/06 and After $ - Appendix J Statutory Sale Prices for Mills Series G Preferred Stock During the 90-Day Period Following the Class Period August 11, November 8, 2006 Date Price Date Price Date Price 8/11/2006 $ /15/2006 $ /19/2006 $ /14/2006 $ /18/2006 $ /20/2006 $ /15/2006 $ /19/2006 $ / $ / $ /20/2006 $ /24/2006 $ /17/2006 $ /21/2006 $ /25/2006 $ /18/2006 $ /22/2006 $ /26/2006 $ /21/2006 $ /25/2006 $ /27/2006 $ /22/2006 $ /26/2006 $ /30/2006 $ /23/2006 $ /27/2006 $ /31/2006 $ /24/2006 $ /28/2006 $ /1/2006 $ /25/2006 $ /29/2006 $ /2/2006 $ /28/2006 $ /2/2006 $ /3/2006 $ /29/2006 $ /3/2006 $ /6/2006 $ /30/2006 $ /4/2006 $ /7/2006 $ /31/2006 $ /5/2006 $ /8/2006 $ /1/2006 $ /6/2006 $ /5/2006 $ /9/2006 $ /6/2006 $ /10/2006 $ /7/2006 $ /11/2006 $ /8/2006 $ /12/2006 $ /11/2006 $ /13/2006 $ /12/2006 $ /16/2006 $ /13/2006 $ /17/2006 $ /14/2006 $ /18/2006 $ N379666

44 EXHIBIT 2

45 rotn) UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION IN RE THE MILLS CORPORATION ) CIVIL ACTION NO. SECURITIES LITIGATION ) 1:06-cv (LO-TRJ) ) This Document relates to: ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1:06-cv (LO-TRJ) ) 1 :06-cv (LO/TRJ) ) 1:07-cv (LO/TRJ) ) GENERAL INSTRUCTIONS PROOF OF CLAIM AND RELEASE DEADLINE FOR SUBMISSION, It is important that you completely read and understand the Notice of Pendency of Class Action, Proposed Settlements and Settlement Fairness Hearing (the "Notice") that accompanies this Proof of Claim and Release and the Plan of Allocation of Total Net Settlement Fund included therein (the "Plan of Allocation"). The Notice and Plan of Allocation describe the proposed Settlements that will resolve this Action, how the Class Members are affected by those Settlements, and the manner in which the Total Net Settlement Fund will be distributed, if any or all of the Settlements and the Plan of Allocation are approved by the Court. The Notice also contains the definitions of many of the defined terms (which are indicated by initial capital letters) used in this Proof of Claim and Release. By signing and submitting the Proof of Claim and Release, you will be certifying that you have read and that you understand the Notice. 2. TO PARTICIPATE IN THE SETTLEMENTS, YOU MUST MAIL YOUR COMPLETED AND SIGNED PROOF OF CLAIM AND RELEASE, BY FIRST-CLASS MAIL, POSTAGE PREPAID, POSTMARKED ON OR BEFORE, 2009, ADDRESSED TO: In re The Mills Corporation Securities Litigation do The Garden City Group, Inc.. P.O. Box EXHIBIT 2

46 rmk.) 3. This Proof of Claim and Release is directed to all persons and entities who purchased or otherwise acquired publicly traded common stock and/or preferred stock of The Mills Corporation ("Mills") between February 27, 2001 through and including August 10, 2006, inclusive (the "Class Period"), and who were injured thereby. This includes purchasers of Mills' common stock and purchasers of Mills preferred stock, Series B, C, E and G (collectively referred to herein as "preferred stock"). Excluded from the Class are (a) the Defendants and all persons and entities who (i) during the Class Period were Defendants' officers, directors and partners or members of Defendants' immediate families or controlled by a Defendant or (ii) at any time, were Defendants' legal representatives, heirs, successors or assigns and assert a claim on the Total Settlement Fund based on a Defendant's purchase or other acquisition of Mills' publicly traded common stock or preferred stock, and (b) persons who purchased and sold all of their Mills securities before the close of the market on October 31, Also excluded from the Class are any putative Class Members who exclude themselves by filing a request for exclusion in accordance with the requirements set forth in the Notice. 4. "Class Member" means any person who is included in the definition of the Class and who did not timely submit a proper request for exclusion in accordance with the requirements set forth in the Notice. 5. "Authorized Claimant" means a Class Member who timely submits to the Claims Administrator a valid Proof of Claim and Release pursuant to the terms of the Stipulations that is approved by the Court for payment from the Total Net Settlement Fund. 6. IF YOU ARE NOT A CLASS MEMBER, OR IF YOU, OR SOMEONE ACTING ON YOUR BEHALF, FILED A REQUEST FOR EXCLUSION FROM THE CLASS, DO NOT SUBMIT A PROOF OF CLAIM AND RELEASE. YOU MAY NOT, DIRECTLY OR INDIRECTLY, PARTICIPATE IN THE SETTLEMENTS IF YOU ARE NOT A CLASS MEMBER. THUS, IF YOU FILE A REQUEST FOR EXCLUSION IN A TIMELY MANNER, ANY PROOF OF CLAIM AND RELEASE THAT YOU SUBMIT, OR WHICH MAY BE SUBMITTED ON YOUR BEHALF, WILL NOT BE ACCEPTED. 7. To recover as a Class Member, you must complete and sign this Proof of Claim and Release and mail it to the Claims Administrator postmarked on or before, If you fail to file a timely, properly addressed, and completed Proof of Claim and Release, your claim may be rejected and you may be precluded from receiving any distribution from the Total Net Settlement Fund, but you will nevertheless be bound by the terms of the Judgments. 8. Submission of this Proof of Claim and Release does not ensure that you will share in the Total Net Settlement Fund. Distributions from the Total Net Settlement Fund are governed by the Plan of Allocation approved by the Court. The proposed Plan of Allocation, which is subject to the Court's approval, is included in the Notice. 9. Payment pursuant to the Plan of Allocation approved by the Court shall be conclusive against all Authorized Claimants. No person shall have any claim against Lead Plaintiffs, Lead Counsel, or the Claims Administrator or other agent designated by Lead Counsel or the Released Parties arising from distributions made substantially in accordance with the 2

47 fffft) Stipulations, the Plan of Allocation, or further orders of the Court. Lead Plaintiffs, Defendants, their respective counsel, and all other Released Parties shall have no responsibility or liability whatsoever for the investment or distribution of the Total Settlement Fund, the Total Net Settlement Fund, the Plan of Allocation, or the determination, administration, calculation, or payment of any Claim Form or nonperformance of the Claims Administrator, the payment or withholding of taxes owed by the Total Settlement Fund, or any losses incurred in connection therewith. 10. If you have questions concerning the Proof of Claim and Release, or need additional copies of the Proof of Claim and Release or the Notice, you may contact the Claims Administrator, The Garden City Group, Inc., at the above address or by toll-free phone at or you can your inquiries through or download the documents from the Claims Administrator's internet web site, corn. 11. If you are a Class Member and you do not, or someone acting on your behalf does not, submit a timely request for exclusion from the Class, and if the Court approves any or all of the Settlements, you will be bound by the terms of any orders and judgments that the Court enters. You will be bound by such orders and judgments whether or not you submit a Proof of Claim and Release. The judgments enjoin the filing or continued prosecution of Settled Claims, and also release the Settled Claims against the Released Parties, including those that are subject to pending lawsuits or arbitrations. 12. You are required to submit genuine and sufficient documentation for all your transactions in Mills common stock and preferred stock during the period from February 27, 2001 through and including August 10, 2006 as well as documentation reflecting your positions in Mills common stock as of the opening and the closing of the Class Period and your positions in each series of preferred stock, as applicable, at the closing of the Class Period (the preferred stock was issued during the Class Period, therefore, "opening" positions do not apply). Additionally, you are required to submit genuine and sufficient documentation for all sales of Mills common stock and preferred stock between August 11, 2006 through and including November 8, Documentation may be photocopies of stockbrokers' confirmation slips or stockbrokers' monthly statements reflecting your opening and closing balances for the months specified on the actual claim form, and in which transactions during the Class Period occurred. IF SUCH DOCUMENTS ARE NOT IN YOUR POSSESSION, PLEASE OBTAIN COPIES OR EQUIVALENT CONTEMPORANEOUS DOCUMENTS FROM YOUR BROKER. FAILURE TO SUPPLY THIS DOCUMENTATION MAY RESULT IN REJECTION OF YOUR CLAIM. DO NOT SEND ORIGINAL STOCK CERTIFICATES. 13. The date of covering a "short sale" is deemed to be the date of purchase of Mills common stock or Preferred Stock. The date of a "short sale" is deemed to be the date of sale of Mills common stock or Preferred Stock. However, please note that "short sales" are not covered by the Plan of Allocation. 14. All joint purchasers must each sign this Proof of Claim and Release. 3

48 /eft) 15. Agents, executors, administrators, guardians, and trustees must complete and sign the Proof of Claim and Release on behalf of persons represented by them and they must: (a) expressly state the capacity in which they are acting; (b) identify the name, account number, Social Security Number (or taxpayer identification number), address and telephone number of the beneficial owner of (or other person or entity on whose behalf they are acting with respect to) the Mills common stock and/or preferred stock; and (c) furnish herewith evidence of their authority to bind to the Proof of Claim and Release the person or entity on whose behalf they are acting. (Authority to complete and sign a Proof of Claim and Release cannot be established by stockbrokers only demonstrating that they have discretionary authority to trade stock in another's accounts.) 16. By submitting a signed Proof of Claim and Release, you will be swearing that you: (a) own(ed) the Mills common stock and/or preferred stock you have listed in the Proof of Claim and Release; or thereof. (b) are expressly authorized to act on behalf of the beneficial owner(s) 17. By submitting a signed Proof of Claim and Release, you will be swearing to the truth of the statements contained therein and the genuineness of the documents attached thereto, subject to penalties of perjury under the laws of the United States of America. The making of false statements, or the submission of forged or fraudulent documentation, will result in the rejection of your claim and may subject you to civil liability or criminal prosecution. NOTICE REGARDING ELECTRONIC FILES: Certain Claimants with large numbers of transactions may request, or may be requested, to submit information regarding their transactions in electronic files. All Claimants MUST submit a manually signed paper Proof of Claim form listing all their transactions, whether or not they also submit electronic copies. If you wish to file your claim electronically, you must contact the Claims Administrator at , or visit its website to obtain the required file layout. No electronic files will be considered to have been properly submitted unless the Claims Administrator issues to the Claimant a written paper acknowledgment of receipt and acceptance of electronically submitted data. 4

49 t"1"'n In re The Mills Corporation Securities Litigation PART I: CLAIMANT IDENTIFICATION Beneficial Owner's Name (First, Middle, Last) / Joint Owner's Name Street Address City State Zip Code Foreign Province Foreign Country Area Code Telephone Number Area Code Telephone Number (Daytime) (Evening) Social Security Number or Taxpayer Identification Number Record Owner's Name (if different from beneficial owner listed above) Check appropriate box (check only one box): O O o Individual/Sole Proprietor 0 Joint Owners 0 Pension Plan Corporation 0 Partnership 0 Trust IRA 0 Other (describe: NOTE: Separate Proofs of Claim should be submitted for each separate legal entity (e.g., a claim from Joint Owners should not include separate transactions of just one of the Joint Owners, an Individual should not combine his or her IRA transactions with transactions made solely in the Individual's name). Conversely, a single Proof of Claim should be submitted on behalf of one legal entity including all transactions made by that entity no matter how many separate accounts that entity has (e.g., a Corporation with multiple brokerage accounts should include all transactions made in Mills common stock) during the Class Period on one Proof of Claim, no matter how many accounts the transactions were made in. 5

50 e/m PART II: TRANSACTIONS IN MILLS COMMON STOCK AND PREFERRED STOCK COMMON STOCK A. BEGINNING HOLDINGS: State the number of shares of Mills common stock the Claimant owned at the close of trading on February 26, If none, write "zero" or "0". If other than zero, be sure to attach the required documentation. B. PURCHASES: List all purchases of Mills common stock made during the period February 27, 2001 through and including August 10, (NOTE: If you acquired your Mills common stock during this period other than by an open market purchase, please provide a complete description of the terms of the acquisition on a separate page.). Be sure to attach the required documentation. Trade Date(s) (List Chronologically) Number of Purchase Price Month/Day/Year Shares Purchased Per Share Total Purchase Price* *excluding commissions, transfer taxes or other fees C. TOTAL PURCHASES: State the total number of shares of Mills common stock purchased during the period February 27, 2001 through and including August 10, D. SALES: List all sales of Mills common stock made during the period February 27, 2001 through and including November 8, Be sure to attach the required documentation. 6

51 e%tr:k) Trade Date(s) (List Chronologically) Number of Sales Price Month/Day/Year Shares Sold Per Share Total Sales Price* *excluding commissions, transfer taxes or other fees E. UNSOLD HOLDINGS: State the number of shares of Mills common stock the Claimant owned at the close of trading on August 11, 2006 and at the close of trading on November 8, If none, write "zero" or "0". Be sure to attach the required documentation. August 11, 2006: November 8, 2006: IF YOU NEED ADDITIONAL SPACE TO LIST YOUR TRANSACTIONS IN THIS SECURITY PLEASE PHOTOCOPY THIS PAGE, WRITE YOUR NAME ON THE COPY AND CHECK THIS BOX 0 IF YOU DO NOT CHECK THIS BOX THESE ADDITIONAL PAGES MAY NOT BE REVIEWED 7

52 rifft\ SERIES B PREFFERED STOCK A. PURCHASES: List all purchases of Mills Series B Preferred Stock made during the period October 9, 2002 through and including August 10, (NOTE: If you acquired your Mills Series B Preferred Stock during this period other than by an open market purchase, please provide a complete description of the terms of the acquisition on a separate page.). Be sure to attach the required documentation. Trade Date(s) (List Chronologically) Number of Purchase Price Month/Day/Year Shares Purchased Per Share Total Purchase Price* *excluding commissions, transfer taxes or other fees B. TOTAL PURCHASES: State the total number of shares of Mills Series B Preferred Stock purchased during the period October 9, 2002 through and including August 10, C. SALES: List all sales of Mills Series B Preferred Stock made during the period October 9, 2002 through and including November 8, Be sure to attach the required documentation. 8

53 rot)) Trade Date(s) (List Chronologically) Number of Sales Price Month/Day/Year Shares Sold Per Share Total Sales Price* *excluding commissions, transfer taxes or other fees D. UNSOLD HOLDINGS: State the number of shares of Mills Series B Preferred Stock the Claimant owned at the close of trading on August 11, 2006 and at the close of trading on November 8, If none, write "zero" or "0". Be sure to attach the required documentation. August 11, 2006: November 8, 2006: IF YOU NEED ADDITIONAL SPACE TO LIST YOUR TRANSACTIONS IN THIS SECURITY PLEASE PHOTOCOPY THIS PAGE, WRITE YOUR NAME ON THE COPY AND CHECK THIS BOX 0 IF YOU DO NOT CHECK THIS BOX THESE ADDITIONAL PAGES MAY NOT BE REVIEWED 9

54 SERIES C PREFFERED STOCK A. PURCHASES: List all purchases of Mills Series C Preferred Stock made during the period December 17, 2002 through and including August 10, (NOTE: If you acquired your Mills Series C Preferred Stock during this period other than by an open market purchase, please provide a complete description of the terms of the acquisition on a separate page.). Be sure to attach the required documentation. Trade Date(s) (List Chronologically) Number of Purchase Price Month/Day/Year Shares Purchased Per Share Total Purchase Price* *excluding commissions, transfer taxes or other fees B. TOTAL PURCHASES: State the total number of shares of Mills Series C Preferred Stock purchased during the period December 17, 2002 through and including August 10, C. SALES: List all sales of Mills Series C Preferred Stock made during the period December 17, 2002 through and including November 8, Be sure to attach the required documentation. 10

55 ft" oft) Trade Date(s) (List Chronologically) Number of Sales Price Month/Day/Year Shares Sold Per Share Total Sales Price* *excluding commissions, transfer taxes or other fees D. UNSOLD HOLDINGS: State the number of shares of Mills Series C Preferred Stock the Claimant owned at the close of trading on August 11, 2006 and at the close of trading on November 8, If none, write "zero" or "0". Be sure to attach the required documentation. August 11, 2006: November 8, 2006: IF YOU NEED ADDITIONAL SPACE TO LIST YOUR TRANSACTIONS IN THIS SECURITY PLEASE PHOTOCOPY THIS PAGE, WRITE YOUR NAME ON THE COPY AND CHECK THIS BOX 0 IF YOU DO NOT CHECK THIS BOX THESE ADDITIONAL PAGES MAY NOT BE REVIEWED 11

56 SERIES E PREFFERED STOCK A. PURCHASES: List all purchases of Mills Series E Preferred Stock made during the period May 5, 2003 through and including August 10, (NOTE: If you acquired your Mills Series E Preferred Stock during this period other than by an open market purchase, please provide a complete description of the terms of the acquisition on a separate page.). Be sure to attach the required documentation. Trade Date(s) (List Chronologically) Number of Purchase Price Month/Day/Year Shares Purchased Per Share Total Purchase Price* *excluding commissions, transfer taxes or other fees B. TOTAL PURCHASES: State the total number of shares of Mills Series E Preferred Stock purchased during the period May 5, 2003 through and including August 10, C. SALES: List all sales of Mills Series E Preferred Stock made during the period May 5, 2003 through and including November 8, Be sure to attach the required documentation. 12

57 (4"\ (00) Trade Date(s) (List Chronologically) Number of Sales Price Month/Day/Year Shares Sold Per Share Total Sales Price* *excluding commissions, transfer taxes or other fees D. UNSOLD HOLDINGS: State the number of shares of Mills Series E Preferred Stock the Claimant owned at the close of trading on August 11, 2006 and at the close of trading on November 8, If none, write "zero" or "0". Be sure to attach the required documentation. August 11, 2006: November 8, 2006: IF YOU NEED ADDITIONAL SPACE TO LIST YOUR TRANSACTIONS IN THIS SECURITY PLEASE PHOTOCOPY THIS PAGE, WRITE YOUR NAME ON THE COPY AND CHECK THIS BOX El IF YOU DO NOT CHECK THIS BOX THESE ADDITIONAL PAGES MAY NOT BE REVIEWED 13

58 SERIES G PREFFERED STOCK A. PURCHASES: List all purchases of Mills Series G Preferred Stock made during the period May 17, 2005 through and including August 10, (NOTE: If you acquired your Mills Series G Preferred Stock during this period other than by an open market purchase, please provide a complete description of the terms of the acquisition on a separate page.). Be sure to attach the required documentation. Trade Date(s) (List Chronologically) Number of Purchase Price Month/Day/Year Shares Purchased Per Share Total Purchase Price* *excluding commissions, transfer taxes or other fees B. TOTAL PURCHASES: State the total number of shares of Mills Series G Preferred Stock purchased during the period May 17, 2005 through and including August 10, C. SALES: List all sales of Mills Series G Preferred Stock made during the period May 17, 2005 through and including November 8, Be sure to attach the required documentation. 14

59 (oft\ Trade Date(s) (List Chronologically) Number of Sales Price Month/Day/Year Shares Sold Per Share Total Sales Price* *excluding commissions, transfer taxes or other fees D. UNSOLD HOLDINGS: State the number of shares of Mills Series G Preferred Stock the Claimant owned at the close of trading on August 11, 2006 and at the close of trading on November 8, If none, write "zero" or "0". Be sure to attach the required documentation. August 11, 2006: November 8, 2006: IF YOU NEED ADDITIONAL SPACE TO LIST YOUR TRANSACTIONS IN THIS SECURITY PLEASE PHOTOCOPY THIS PAGE, WRITE YOUR NAME ON THE COPY AND CHECK THIS BOX 0 IF YOU DO NOT CHECK THIS BOX THESE ADDITIONAL PAGES MAY NOT BE REVIEWED 15

60 r4"'n en,\ Definitions PART III: RELEASE OF CLAIMS AND SIGNATURE For the purpose of the Proof of Claim, defined terms have the following meanings. (Other defined terms have the meanings given them in the respective Stipulations and Agreements of Settlement ( the "Stipulations"). "Effective Date" means the date the Judgment(s) becomes Final (as defined in J1 (1) & (p) of the Stipulations). "Judgments" means the Orders entered by the Court, if and upon approval of the Settlements, dismissing the Action with prejudice and without costs to any Released Party, certifying the Class for settlement purposes, releasing all Settled Claims as against the Released Parties, and enjoining Class Members from instituting, continuing or prosecuting any action asserting any Settled Claims against any Released Party. "Released Parties" means: (1) as to the Mills Settlement, any and all of (a) the Settling Mills Defendants (i.e, The Mills Corporation, The Mills Limited Partnership, Laurence C. Siegel, Kenneth R. Parent, Mary Jane Morrow, Nicholas McDonough, James F. Dausch, James C. Braithwaite, Dietrich von Boetticher, Franz Freiherr von Perfall, Joseph B. Gildenhorn, Harry H. Nick, Cristina L. Rose, Robert P. Pincus, John M. Ingram, Charles R. Black, Jr., Mark D. Ettinger, D. Gregory Neeb, James A. Nappoli, Columbe M. Nicholas, S. Joseph Bruno and Sir Frank Lampl, the Purchasers (i.e., Simon Property Group, Inc., Simon Property Group, L.P., Farallon Capital Management, LLC, Farallon Partners L.L.C. and SPG-FCM Ventures, LLC), the Settling Underwriter Defendants (i.e., Merrill Lynch, Pierce Fenner & Smith Incorporated, Morgan Stanley & Co. Incorporated, Wachovia Capital Markets, LLC, RBC Dain Rauscher, Inc., Legg Mason Wood, Walker, Incorporated, BB&T Capital Markets (a division of Scott & Stringfellow, Inc.), KeyBanc Capital Markets (a division of McDonald Investments Inc.), Stifel, Nicolaus & Company, Wells Fargo Securities, LLC, A.G. Edwards & Sons, Inc., Advest, Inc., Arthurs, Lestrange & Company Incorporated, C.L. King & Associates, Inc., Crowell, Weedon & Co., D.A. Davidson & Co., Doley Securities, LLC, Ferris, Baker, Watts Incorporated, Janney Montgomery Scott LLC, JVB Financial Group, LLC, Maxim Group LLC, McGinn, Smith & Co., Inc., Mesirow Financial, Inc., Morgan Keegan & Company, Inc., Oppenheimer & Co. Inc., Pershing LLC, Piper Jaffray & Co., Ryan Beck & Co., Wedbush Morgan Securities, Inc., William Blair & Company L.L.C. and Ziegler Capital Markets Group) and any other person or entity who acted as an underwriter for the offering of Mills' Series G preferred stock and (b) for each of the foregoing Released Parties, each of their respective past and present subsidiaries, parents, successors and predecessors, legal representatives, heirs, assigns, partners, members, managers, officers, directors, agents, employees, attorneys, affiliates, controlled persons, controlling persons, insurers, advisors, and investment advisors. (2) as to the E&Y Settlement, any and all of (a) E&Y; (b) each of E&Y's respective past and present subsidiaries, divisions, business units, parents, successors and predecessors, legal representatives, heirs, assigns, partners, principals, members, managers, officers, directors, agents, employees, attorneys, affiliates, controlled persons, controlling persons, insurers, advisors, and investment advisors; and (c) Ernst & Young Global Limited, its past and present members, affiliated entities, subsidiaries, successors, predecessors, officers, 16

61 directors, employees, attorneys, controlled persons, controlling persons, insurers, advisors, and investment advisors. (3) as to the KanAm Settlement, any and all of (a) the KanAm Defendants (Le, KanAm Services, L.P., KanAm Management L.L.C., KanAm L.L.C., KanAm Providers, Inc., KanAm Realty, Inc., KanAm US, Inc., KanAm America, Inc., KanAm International GmbH, and KanAm Grund Kapitalanlagegesellschaft mbh) and (b) each of the KanAm Defendants' respective past and present subsidiaries, divisions, business units, parents, successors and predecessors, legal representatives, heirs, assigns, partners, principals, members, managers, officers, directors, agents, employees, attorneys, affiliates, controlled persons, controlling persons, insurers, advisors, investment advisors, and any entity in which any of the KanAm Defendants or the above-described persons or entities owns or has owned any direct or indirect interest, including without limitation the following: East Coast Commons, L.P, East Coast Development, L.P., KanAm USA V, L.P., KanAm USA VI, L.P., KanAm USA VII, L.P., KanAm USA VIII, L.P., KanAm USA IX, L.P., KanAm USA X, L.P., KanAm USA XI, L.P., KanAm USA XII, L.P., KanAm USA XIII, L.P., KanAm USA XIV, L.P., KanAm USA XV, L.P., KanAm USA XVI, L.P., KanAm USA XVII, L.P., KanAm USA XVIII, L.P., KanAm USA XIX, L.P., KanAm USA XX, L.P., KanAm USA XXI, L.P., KanAm USA XXII, L.P., KanAm USA V, L.P., KanAm USA V, L.P., KanAm Properties, L.P., KanAm USA, L.P. (MD), KanAm US, L.P. (MD), KanAm US, L.P. (GA.), KanAm USA, L.P. (Del.), KanAm USA Management X, L.P., KanAm USA Management XI, L.P., KanAm USA Management XII, L.P., KanAm USA Management XIII, L.P., KanAm USA Management XIV, L.P., KanAm USA Management XV, L.P., KanAm USA Management XVI, L.P., KanAm USA Management XVII, L.P., KanAm USA Management XVIII, L.P., KanAm USA Management XIX, L.P., KanAm USA Management XX, L.P., KanAm USA Management XXI, L.P., and KanAm USA Management XXII, L.P.. "Settled Claims" means any and all claims, debts, demands, rights or causes of action or liabilities whatsoever (including, but not limited to, any claims for damages, interest, attorneys' fees, expert or consulting fees, and any other costs, expenses or liability whatsoever), whether based on federal, state, local, or foreign statutory or common law or any other law, rule or regulation, whether fixed or contingent, accrued or unaccrued, liquidated or unliquidated, at law or in equity, matured or unmatured, whether class, derivative or individual in nature, including both known claims and Unknown Claims, (i) that have been asserted in this Action by the Class Members or any of them against any of the Released Parties, or (ii) that could have been asserted in any forum by the Class Members or any of them against any of the Released Parties which in any way arise out of, are related to, or are based upon (a) the allegations, transactions, facts, matters or occurrences, representations or omissions involved, set forth, or referred to in the Consolidated Complaint, the Consolidated Amended Complaint or any subsequent amendment of the Amended Complaint (including the Second Amended Complaint) or (b) investments (including, but not limited to, purchases or other acquisitions, sales, exercises, and decisions to hold) in any securities issued by, or instruments referencing securities issued by, Mills or Mills LP, including without limitation all claims arising out of or relating to any disclosures, public filings, registration statements or other statements by any and all of the Former Defendants (as defined in the Stipulations) and Defendants. "Unknown Claims" means any and all Settled Claims which any Lead Plaintiff or other Class Member does not know or suspect to exist in his, her or its favor at the time of the release of the 17

62 (41 /41) Released Parties in the respective Stipulations, and any Mills Entities Claims that any Mills Entities does not know or suspect to exist in its favor, and E&Y Claims that E&Y does not know or suspect to exist in its favor, and any KanAm Claims that the KanAm Defendants do not know or suspect to exist in their favor, which if known by any of them might have affected their decisions with respect to the Settlements. With respect to any and all Settled Claims and Mills Entities Claim, E&Y Claims, and KanAm Claims, the parties stipulate and agree that upon the Effective Date of the respective Settlements, the Lead Plaintiffs, the Mills Entities, E&Y and the KanAm Defendants shall each, for themselves and all persons claiming by, through, or on behalf of them, expressly waive, and each other Class Member shall be deemed to have waived, and by operation of the Judgment shall have expressly waived, any and all provisions, rights and benefits conferred by any law of any state or territory of the United States, or principle of common law, that is similar, comparable, or equivalent to Cal. Civ. Code 1542, which provides: A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor. Lead Plaintiffs, the Mills Entities, E&Y, and the KanAm Defendants acknowledge, and all other Class Members by operation of law shall be deemed to have acknowledged, that the inclusion of "Unknown Claims" in the definition of Settled Claims and Mills Entities Claims, E&Y Claims and KanAm Claims was separately bargained for and is a key element of each of the Settlements and Stipulations. The Release I (we) understand and acknowledge that without further action by anyone, on and after the Effective Date for the approved Settlement(s), each Class Member, including Class Members who have pending or later initiate any other actions, arbitrations, or other proceedings against any of the Defendants, or any other Released Party relating to the Settled Claims, as to whom the relevant Settlement has become Final, on behalf of themselves, their heirs, executors, administrators, predecessors, successors, assigns, and any person they represent or who is claiming by, through or on behalf of them, for good and sufficient consideration, the receipt and adequacy of which are hereby acknowledged, shall be deemed to have, and by operation of law and of the relevant Judgment(s) shall have fully, finally, and forever released, waived, relinquished, settled, dismissed and discharged all Settled Claims against each and every one of the Released Parties under the terms of the effective Settlement(s), including such Settled Claims as already may have been asserted in any pending actions, arbitrations, or other proceedings, and whether or not a Proof of Claim and Release is executed and delivered by, or on behalf of, such Class Member. SIGNATURE AND CERTIFICATIONS By signing and submitting this Proof of Claim and Release, the Claimant(s) or the person(s) who represents the Claimant(s) certifies, as follows: 1. that the Claimant(s) is a (are) Class Member(s), as defined in the Notice; 2. that I (we) have read and understand the contents of the Notice and the Proof of Claim; 3. that I (we) are not acting for any of the Defendants, nor am I (are we) such a Defendant or otherwise excluded from the Class; 4. that I (we) have not filed a request for exclusion from the Class and that I (we) do not know 18

63 (4""` (ARk,\ of any request for exclusion from the Class filed on my (our) behalf with respect to my (our) transactions in Mills common stock and/or preferred stock; 5. that I (we) own(ed) the Mills common stock and/or preferred stock identified in the Proof of Claim, or that, in signing and submitting this Proof of Claim, I (we) have the authority to act on behalf of the owner(s) thereof; 6. that Claimant(s) may be entitled to receive a distribution from the Total Net Settlement Fund; 7. that Claimant(s) desires (desire) to participate in the settlements described in the Notice and agrees (agree) to the terms and conditions thereof; 8. that I (we) submit to the jurisdiction of the United States District Court for the Eastern District of Virginia, Alexandria Division for purposes of investigation and discovery under the Federal Rules of Civil Procedure with respect to this Proof of Claim; 9. that I (we) agree to furnish such additional information with respect to this Proof of Claim as the parties or the Court may require; 10. that I (we) waive trial by jury, to the extent it exists, and agree to the Court's summary disposition of the determination of the validity or amount of the claim made by this Proof of Claim; and 11. that I (we) certify that I am (we are) not subject to backup withholding under the provisions of Section 3406(a)(1)(c) of the Internal Revenue Code. NOTE: If you have been notified by the Internal Revenue Service that you are subject to backup withholding, please strike the language that you are not subject to backup withholding in the certification above. The Internal Revenue Service does not require your consent to any provision other than the certification required to avoid backup withholding. I (We) declare, under penalty of perjury under the laws of the United States of America, that the statements made and answers given in this Proof of Claim are true and correct and that the documents submitted herewith are true and genuine. Signature of Claimant Print Name of Claimant Date Signature of Joint Claimant, if any Print Name of Joint Claimant Date If Claimant is other than an individual, or is not the person completing this form, the following also must be provided: Signature of Person Completing Form Print Name of Person Completing Form Date Capacity of Person Signing (Executor, President, Trustee, etc.) 19

64 (4!') REMINDER CHECKLIST 1. Please sign the Certification Section of the Proof of Claim and Release form. 2. If this Claim is being made on behalf of Joint Claimants, then both must sign. 3. Please remember to attach supporting documents. 4. DO NOT SEND ORIGINALS OF ANY SUPPORTING DOCUMENTS. 5. Keep a copy of your Proof of Claim and Release form and all documentation submitted for your records. 6. The Claims Administrator will acknowledge receipt of your Proof of Claim and Release by mail, within 60 days. Your claim is not deemed filed until you receive an acknowledgment postcard. If you do not receive an acknowledgment postcard within 60 days, please call the Claims Administrator toll free at If you move, please send your new address to: In re The Mills Corporation Securities Litigation do The Garden City Group, Inc. P.O. Box 8. Do not use highlighter on the Proof of Claim and Release form or supporting documentation. THIS PROOF OF CLAIM MUST BE POSTMARKED NO LATER THAN 2009 AND MUST BE MAILED TO: In re The Mills Corporation Securities Litigation do The Garden City Group, Inc. P.O. Box ACCURATE CLAIMS PROCESSING TAKES A SIGNIFICANT AMOUNT OF TIME. # THANK YOU FOR YOUR PATIENCE 20

65 EXHIBIT 3

66 (41',fmN, UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION IN RE THE MILLS CORPORATION CIVIL ACTION NO. SECURITIES LITIGATION 1:06-cv (LO-TRJ) SUMMARY NOTICE OF PENDENCY OF CLASS ACTION, PROPOSED SETTLEMENTS AND SETTLEMENT FAIRNESS HEARING TO: ALL PERSONS OR ENTITIES WHO PURCHASED OR OTHERWISE ACQUIRED PUBLICLY TRADED COMMON STOCK AND/OR PREFERRED STOCK OF THE MILLS CORPORATION ("MILLS") DURING THE PERIOD FROM FEBRUARY 27, 2001, THROUGH AUGUST 10, 2006, AND WHO WERE DAMAGED THEREBY. PLEASE READ THIS NOTICE CAREFULLY. YOUR RIGHTS WILL BE AFFECTED BY A CLASS ACTION LAWSUIT PENDING IN THIS COURT. YOU ARE HEREBY NOTIFIED, pursuant to Rule 23 of the Federal Rules of Civil Procedure and an Order of the United States District Court for the Eastern District of Virginia, Alexandria Division, (i) of the pendency of this action (the "Action") as a class action on behalf of the persons and entities described above (the "Class"), except for certain persons and entities who are excluded from the Class by definition, including persons who purchased and sold all of their Mills stock before the close of the market on October 31, 2005; and (ii) that three settlements in this Action for a combined total of $ million in cash have been proposed that will fully and finally settle all claims against and release all Defendants. A hearing will be held before the Honorable Liam O'Grady, at the United States District Court for the Eastern District of Virginia, Alexandria Division, Albert V. Bryan U.S. Courthouse, 401 Courthouse Square, Courtroom 7, Alexandria, VA at /0444 on Ocipt (i) to determine whether each of the proposed Settlements should be approved by the Court as fair, reasonable, and adequate; (ii) to determine whether the Settled Claims against the Settling Defendants and the other Released Parties should be dismissed with prejudice; (iii) to determine whether a proposed plan of allocation should be approved by the Court as fair and reasonable; and (iv) to determine whether fees and reimbursement of expenses should be awarded to Lead Counsel and, if so, the amount of such an award. IF YOU ARE A MEMBER OF THE CLASS DESCRIBED ABOVE, YOUR RIGHTS WILL BE AFFECTED BY THE PENDING ACTION AND THE SETTLEMENTS, AND YOU MAY BE ENTITLED TO SHARE IN THE SETTLEMENT FUNDS. If you have not yet received the full printed Notice of Pendency of Class Action, Proposed Settlements and Settlement Fairness Hearing (the "Notice"), with the attached Claim Form, you may obtain a copy of these documents by contacting the Claims Administrator: In re The Mills Corporation Securities Litigation, c/o The Garden City Group, Inc. P.O. Box EXHIBIT 3