<PAGE>
The information in this Term Sheet will be superseded by the information
contained in any subsequent term sheets and definitive offering circular for any
securities actually sold to you. This material is intended solely for "qualified
institutional buyers" within the meaning of Rule 144A under the Securities of
1933, as amended. If you are not a "qualified institutional buyer," you should
promptly return this material to Lehman Brothers.
November 2, 2000
TERM SHEET
REGARDING PRIVATE OFFERING OF
$10,500,000 "B NOTE"
(APPROXIMATE)
GALLERY AT HARBORPLACE
BALTIMORE, MARYLAND
--------------------------------------------------------------------------------
EXPECTED SHADOW RATING APPROXIMATE FACE CUMULATIVE CUMULATIVE
(S&P) AMOUNT(1) LTV %(2) DSCR(3)
--------------------------------------------------------------------------------
A- 3,000,000 52.50% 1.77x
--------------------------------------------------------------------------------
BBB 7,500,000 58.80% 1.58x
--------------------------------------------------------------------------------
TOTALS: $10,500,000 58.80% 1.58x
--------------------------------------------------------------------------------
(1) Subject to change based upon completion of rating agency due diligence.
(2) Calculation based on the Lehman Brothers estimated value of $120,000,000
and assuming the loan amount including the A Note principal balance of
$60,000,000.
(3) Calculated based on the actual debt constant of 8.64%, underwritten net
cash flow of $9,622,897 and assuming the loan amount including the A Note
principal balance of $60,000,000.
LEHMAN BROTHERS
This material is for your private information and we are not soliciting any
action based upon it. No securities are being offered by these summary
materials. This material is based on information that we consider reliable, but
we do not represent that it is accurate or complete and it should not be relied
upon as such. By accepting this material, the recipient agrees that it will not
distribute or provide the material to any other person. The information
contained in this material may not pertain to any securities that may be sold.
The information contained in this material may be based on assumptions regarding
market conditions and other matters as reflected therein. We make no
representations regarding the reasonableness of those assumptions or the
likelihood that any of those assumptions will coincide with actual market
conditions or events, and this material should not be relied upon for such
purposes. Information contained in this material is current as of the date
appearing on this material only. Information in this material regarding the
assets and securities discussed herein supersedes all prior information
regarding such assets and securities. This material is intended solely for
"qualified institutional buyers" within the meaning of Rule 144A under the
Securities of 1933, as amended. If you are not a "qualified institutional
buyer," you should promptly return this material to Lehman Brothers.
<PAGE>
The information in this Term Sheet will be superseded by the information
contained in any subsequent term sheets and definitive offering circular for any
securities actually sold to you. This material is intended solely for "qualified
institutional buyers" within the meaning of Rule 144A under the Securities of
1933, as amended. If you are not a "qualified institutional buyer," you should
promptly return this material to Lehman Brothers.
November 2, 2000
MORTGAGE LOAN HIGHLIGHTS(1)
---------------------------
o $70,500,000 first fee mortgage loan (the "Original Loan") to be split into
two mortgage loans (the "New Loans") evidenced by a $60,000,000 A Note (the
"A Note") and a $10,500,000 B Note (the "B Note"), respectively. The A Note
will be transferred to the LB-UBS 2000-C5 securitization.
o The Original Loan is a 7.80% fixed rate, hyperamortizing loan(2), with a
30-year amortization schedule, an Anticipated Repayment Date of December
2010 (the "Anticipated Repayment Date" or "ARD") and a final maturity date
of December 2030.
o The New Loans will be secured by the office and retail component of the
Gallery at Harborplace (the "Property"), a mixed-use development consisting
of 138,352 net rentable square feet of retail space, 264,729 net rentable
square feet of office space. Borrower has rights to a 1,140 parking space
garage subject to payments owed to the City of Baltimore in connection with
bonds issued to finance the construction of the garage.
o Sponsorship: The Rouse Company currently owns and manages the Property. The
Rouse Company is a REIT that has engaged in the ownership, operation and
management of office, industrial, retail and large scale developments for
over 60 years. The company owns 250 properties located in 25 states and
Canada. As of October 19, 2000, the Company had a market capitalization of
$5.2 billion and senior unsecured debt ratings of Baa2/BBB- from Moody's
and S&P, respectively. Moody's maintains a 'stable' outlook on the company,
while Standard & Poor's maintains a 'positive' outlook.
o LTV: The A Note and B Note have a combined loan-to-value ratio of 58.8%
based on Lehman Brothers' estimated value of $120,000,000.
o DSCR: Based on underwritten net cashflow of $9,622,897 and an expected loan
constant of 8.64%, the A Note and B Note have a combined DSCR of 1.58x.
o Prepayment Provisions: Lock out with defeasance permitted two years after
securitization. Prepayment without penalty allowed one month prior to ARD.
o Cash Management: Springing lockbox if debt service coverage falls below
1.25x.
o Reserves: Monthly for tax and insurance escrows.
(1) Mortgage loan terms described herein are preliminary and are subject to
change prior to closing, which is scheduled to be on or about November 15, 2000.
(2) The interest rate for the New Loans after the Anticipated Repayment Date
shall be fixed at the greater of: the sum of the regular interest rate plus 5%,
or the sum of the yield on a US Treasury Note with a term equal to the term of
the loan from the Anticipated Payment Date to the Maturity Date plus 5%. The
amount by which interest at the post-Anticipated Repayment Date rate exceeds
interest at the regular interest rate shall be added to principal, shall
compound at the post-Anticipated Repayment Date rate and shall be payable after
all interest at the regular interest rate, and the principal balance of the
loan, have been paid in full. After the Anticipated Repayment Date, certain
amounts of excess cash flow shall be utilized to pay principal of the loan.
This material is for your private information and we are not soliciting any
action based upon it. No securities are being offered by these summary
materials. This material is based on information that we consider reliable, but
we do not represent that it is accurate or complete and it should not be relied
upon as such. By accepting this material, the recipient agrees that it will not
distribute or provide the material to any other person. The information
contained in this material may not pertain to any securities that may be sold.
The information contained in this material may be based on assumptions regarding
market conditions and other matters as reflected therein. We make no
representations regarding the reasonableness of those assumptions or the
likelihood that any of those assumptions will coincide with actual market
conditions or events, and this material should not be relied upon for such
purposes. Information contained in this material is current as of the date
appearing on this material only. Information in this material regarding the
assets and securities discussed herein supersedes all prior information
regarding such assets and securities. This material is intended solely for
"qualified institutional buyers" within the meaning of Rule 144A under the
Securities of 1933, as amended. If you are not a "qualified institutional
buyer," you should promptly return this material to Lehman Brothers.
<PAGE>
The information in this Term Sheet will be superseded by the information
contained in any subsequent term sheets and definitive offering circular for any
securities actually sold to you. This material is intended solely for "qualified
institutional buyers" within the meaning of Rule 144A under the Securities of
1933, as amended. If you are not a "qualified institutional buyer," you should
promptly return this material to Lehman Brothers.
November 2, 2000
PROPERTY HIGHLIGHTS
-------------------
o The Gallery at Harborplace is a mixed-use development located in
Baltimore's Inner Harbor, which is one of Maryland's premier tourist
attractions. The property is a 28-story mixed-use development featuring
138,532 net rentable square feet of retail space, 264,729 net rentable
square feet of office space and 1,140 space garage.
o Other Property Features:
- The retail portion features more than 75 shops and eateries lining an
open vaulted atrium.
- The office component is Class A and is regarded as one of the best
office spaces in the City of Baltimore.
- The Property has an attractive and modern design featuring a six-story
atrium lined by retail shops and eateries, cascading escalators and one
of the best harbor views in Baltimore.
- The Property benefits from increased traffic relating to the
Renaissance Hotel located in a separate subdivided air rights parcel
above the retail center and two retail/restaurant pavilions located
across the street.
- The Property is located in the center of Baltimore's Inner Harbor area,
which draws 15 million visitors annually.
o Location: Baltimore, Maryland
o Year Built: The retail space and the parking garage were built in 1987 and
the office space was built in 1988.
o Top Five Retail Tenants:
<TABLE>
<CAPTION>
SQUARE FOOTAGE % OF TOTAL GLA LEASE EXPIRATION
<S> <C> <C> <C>
The Gap 10,257 2.5% 1/31/05
Brooks Brothers 8,573 2.1% 8/31/10
Forever 21 8,131 2.0% 5/31/10
Casual Corner 5,521 1.4% 8/31/07
Talbots 5,275 1.3% 1/31/10
</TABLE>
o Top Five Office Tenants:
<TABLE>
<CAPTION>
SQUARE FOOTAGE % OF TOTAL GLA LEASE EXPIRATION
<S> <C> <C> <C>
KPMG LLP 46,367 11.5% 4/30/08; 10/31/00
Hogan & Hartson 32,620 8.1% 9/30/03
ExecuCentre 25,896 6.4% 12/31/01
Blau Direct Edge 24,894 6.2% 3/31/06; 9/30/05
Niles, Barlton 21,835 5.4% 6/30/06
</TABLE>
* Other office tenants include A.G. Edwards & Sons and Donaldson, Lufkin &
Jenrette
o Occupancy: Retail occupancy of 90.4%; office occupancy of 98.4%; overall
occupancy of 95.6% as of July 2000.
o Retail Sales: In-line sales for the trailing twelve months ending July 2000
were approximately $421 per square foot.
o Occupancy Costs: 14.6% as of July 2000
o Borrower's TTM (10/99-9/00) NOI: $9,486,135 according to borrower-provided
financial statements.
o Underwritten cashflow: $9,622,897 based on leases in place as of September
2000 and rent step-ups of such leases for succeeding twelve months.
This material is for your private information and we are not soliciting any
action based upon it. No securities are being offered by these summary
materials. This material is based on information that we consider reliable, but
we do not represent that it is accurate or complete and it should not be relied
upon as such. By accepting this material, the recipient agrees that it will not
distribute or provide the material to any other person. The information
contained in this material may not pertain to any securities that may be sold.
The information contained in this material may be based on assumptions regarding
market conditions and other matters as reflected therein. We make no
representations regarding the reasonableness of those assumptions or the
likelihood that any of those assumptions will coincide with actual market
conditions or events, and this material should not be relied upon for such
purposes. Information contained in this material is current as of the date
appearing on this material only. Information in this material regarding the
assets and securities discussed herein supersedes all prior information
regarding such assets and securities. This material is intended solely for
"qualified institutional buyers" within the meaning of Rule 144A under the
Securities of 1933, as amended. If you are not a "qualified institutional
buyer," you should promptly return this material to Lehman Brothers.
<PAGE>
The information in this Term Sheet will be superseded by the information
contained in any subsequent term sheets and definitive offering circular for any
securities actually sold to you. This material is intended solely for "qualified
institutional buyers" within the meaning of Rule 144A under the Securities of
1933, as amended. If you are not a "qualified institutional buyer," you should
promptly return this material to Lehman Brothers.
November 2, 2000
STRUCTURAL SUMMARY
------------------
A/B NOTE STRUCTURE The New Loans will be evidenced by the A Note and the B
Note. The New Loan evidenced by the A Note, which will
have a loan amount with credit characteristics consistent
with those of a rating which is not lower than "A" by
S&P, will be contributed to the LB-UBS 2000-C5
securitization. The New Loan evidenced by the B Note will
be sold separately to a Qualified Institutional Buyer
either through a direct sale of the B Note or through a
sale to another trust which will in turn issue securities
representing the whole interest in such note.
The holder of the B Note or of the securities
collateralized by the B Note, as applicable, will have
certain rights and remedies including the following:
o The right, but not the obligation, to buy the A Note
out of the LB-UBS 2000-C5 transaction following
either of the A Note or B Note being subject to
special servicing and a 60-day monetary delinquency,
in order to effect a different course of asset
resolution from the one proposed by the
transaction's special servicer. The purchase price
of the A Note is par plus any accrued interest and
trust expenses relating to the A Note (including
interest on Advances described below);
o The right to receive all notices of significant
special servicing events; and
o The right to advise and direct the special servicer
with respect to actions taken by the special
servicer regarding significant special servicing
events and waivers of due on sale and due on
encumbrance clauses provided that (i) the principal
balance of the B Note, less any appraisal
reductions, is at least 50% of the initial principal
balance of the B Note, and (ii) such advice or
direction is consistent with the servicing standard.
DISTRIBUTIONS Interest and principal payments will be allocated first
to the A Note and then to the B Note.
ADVANCING The servicer will be obligated to make advances of
scheduled principal and interest payments and certain
servicing expenses ("Advances"), to the extent that such
Advances are deemed to be recoverable. Such Advances will
accrue interest at the Prime Rate. The B Note holder has
the right to request the servicer to terminate any
Advances relating to amounts owed on the B Note.
This material is for your private information and we are not soliciting any
action based upon it. No securities are being offered by these summary
materials. This material is based on information that we consider reliable, but
we do not represent that it is accurate or complete and it should not be relied
upon as such. By accepting this material, the recipient agrees that it will not
distribute or provide the material to any other person. The information
contained in this material may not pertain to any securities that may be sold.
The information contained in this material may be based on assumptions regarding
market conditions and other matters as reflected therein. We make no
representations regarding the reasonableness of those assumptions or the
likelihood that any of those assumptions will coincide with actual market
conditions or events, and this material should not be relied upon for such
purposes. Information contained in this material is current as of the date
appearing on this material only. Information in this material regarding the
assets and securities discussed herein supersedes all prior information
regarding such assets and securities. This material is intended solely for
"qualified institutional buyers" within the meaning of Rule 144A under the
Securities of 1933, as amended. If you are not a "qualified institutional
buyer," you should promptly return this material to Lehman Brothers.
