EFTA Document EFTA01447596

From: Vahe Stepania Sent: 7/10/2014 1:40:12 PM To: jeevacation@gmail.com; CC: Paul Morris Subject: Loan Fund ICI Attachments: pic30662.gif; pic29943.gif; pic11187.gif; pict)9474.gif; pic10048.gif Classification: Confidential Jeffrey - following up on your conversation yesterday with vinit. His team likes the below implementation of the loan deal. Buy $20mm (510mm with cash + SlOmm on margin) of the DWS Floating rate loan fund (Ticker: DFRTX) which is a S3.3bn institutional class mutual fund investing in senior 1st lien collateralised loans. It is managed by Deutsche. The terms of the leverage (which we would require DB credit approval for) indicatively are 50% LTV at 3mL+125bp. The purpose is to lever your return. We compared several funds and like this DWS fund in particular for the following reasons: 1. Performance - top third morningstar in 2008 when mkts tanked, 2009 when mkts recovered and 2010 when mkts went sideways. It currently yields just below 4% net of fees and has had an annualised yield over the past year of 3.5% to 4.25% depending on the NAV 2. Fees are middle of the pack at 82bp (range is 60-100bp) 3. Portfolio management team of two have 32y and 33y experience respectively. Both joined Deutsche in eight years ago. The key to performance is proper loan due diligence combined with market timing 4. Fund size is S3.3bn. This is a huge benefit. unlike some funds they don't have to buy every loan that is issued and instead can be highly selective 5. Both entry and exit are at close of business NAV. i.e. zero entry or exit transaction costs 6. Daily liquidity where some other funds are 30/60/90days. Even in 2008 when all credit markets tanked and became this fund maintained daily liquidity. 7. Credit rating of loans held is presently approx. 35% BB and 60% single-B which are fine while defaults are low 8. monthly income (as coupon) 9. US based fund BTW - US brokerage a/c margin lending regulations require that for the first 30days you'd need to put up the whole $20mm and after that borrow SlOmm. Please let us know if you have questions. Thank you, vahe (Embedded image moved to file: pic30662.gif) Vahe Stepanian Associate I Wealth Investment Coverage Deutsche Bank Securities Inc. Deutsche Asset & Wealth Management 345 Park Avenue - 26th Floor 4 All trade execution information contained herein is being provided as an accommodation at your request in advance of your receipt of the official trade confirmation(s). Additional trade detail information available upon request. The terms of the trade(s) may be subject to change prior to settlement, and therefore the official trade confirmation(s) and account statements issued by Deutsche Bank shall govern. Deutsche Bank is not responsible for any discrepancy between the informal execution report and the official trade confirmation(s) or account statements. CONFIDENTIAL — PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0 102272 CONFIDENTIAL SDNY_GM_00248456 EFTA01447596