Exhibit 10.1

 

MEMORANDUM OF UNDERSTANDING

 

This MEMORANDUM OF UNDERSTANDING (the “Memorandum”) is entered into as of the
10th day of May, 2004 by and between Mark D. Ettenger (the “Executive”) and THE
MILLS CORPORATION (the “Company”).

 

Recitals

 

R-l           Executive and the Company are parties to that certain term sheet
captioned “MARK ETTENGER EMPLOYMENT TERM SHEET” (the “Term Sheet”) that was
executed by the Company on December 16, 2003 and was executed by the Executive
on January 20, 2004.

 

R-2          Concurrently with the execution of this Memorandum, Executive and
the Company are executing and delivering that certain Employment Agreement
bearing an effective date as of February 2, 2004 (the “Employment Agreement”)
that satisfies the terms and conditions of the Term Sheet, with certain
modifications that have been agreed upon by the parties.

 

R-3          Executive and the Company are entering into this Memorandum for the
purpose of confirming certain additional understandings that have been agreed
upon by such parties but are not set forth in the Agreement.

 

Agreements

 

For good and valuable consideration, Executive and the Company agree as follows:

 

1.             Defined Terms. Unless otherwise defined herein, capitalized terms
shall have the same definitions as are set forth for such terms in the
Employment Agreement.

 

2.             Dividend Equivalent Payments on RSUs.  Paragraph V.e of the Term
Sheet contemplated that on Executive’s “Commencement Date,” the Company would
issue an inducement grant of 110,000 restricted stock units.  Section 4.4 of the
Employment Agreement defers the date by which such RSUs must be issued to a date
not later than June 1, 2004. On May 3, 2004, the Company has paid a regular
common dividend in the amount of $0.595 per share of common stock to
shareholders of record on April 23, 2004. As additional consideration for the
modification of the date of issuance of the Inducement Grant, the Company agrees
to pay to Executive, not later than June 1, 2004, the sum of $65,450.00, which
represents the amount of the the “dividend equivalent” that would have been
payable pursuant to Section 4.4(b) of the Employment Agreement on May 3, 2004,
had the Inducement Grant been issued on or before April 20, 2004.

 

3.             Attorneys Fees.  The Company agrees to reimburse Executive for
the costs of attorneys fees incurred by him with the law firm of Wilke, Farr and
Gallagher LLP, in an amount not to exceed $125,000.00.  Such reimbursement shall
be made not later than thirty days following presentment of an invoice for such
fees.  At Executive’s option, the Company will issue such payment directly to
Wilke Farr & Gallagher in satisfaction of this obligation.

 

4.             Miscellaneous.  This Memorandum is intended to confirm a legally
binding obligation of the parties hereto. This Memorandum may be executed in
multiple counterparts, each of which, when fully executed, will constitute the
same instrument.

 

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IN WITNESS WHEREOF, Executive and the Company have executed and delivered this
Memorandum on the 10th day of May, 2004.

 

Executive:

 

 

 

 

 

 

/s/ Mark Ettenger

 

Mark Ettenger

 

 

 

 

The Company:

THE MILLS CORPORATION
a Delaware corporation

 

 

 

 

 

By:

/s/ Laurence C. Siegel

 

 

Laurence C. Siegel

 

 

Chairman and Chief Executive

 

 

Officer

 

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