Publicly available General Introduction to Deutsche Bank Quality of Life Markets 2007

11/14/2007
A General Introduction
Deutsche Bank’s Quality of Life MarketsTM
Quality of Life Indices® and index-linked securities
Keith Cunningham
(212) 250 8866
Guillermo MacLean
(212) 250 8866

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Disclaimer
 This information is provided to you by Deutsche Bank and is not intended for trading purposes. This has
been prepared solely for informational purposes. It is not an offer, recommendation or solicitation to buy
or sell, participate in any trading strategy, nor is it an official confirmation of terms. It is based on
information generally available to the public from sources believed to be reliable. No representation is
made that it is accurate or complete or that any returns indicated will be achieved. Additional information
is available upon request.
 Deutsche Bank transacts business with counterparties on an arm’s length basis and on the assumption
that each counterparty is sophisticated and capable of independently evaluating the merits and risks of
each transaction and that the counterparty is making an independent decision regarding any transaction.
There is no guarantee that a similar structure would have been available at any point in the past and that
such results could have been achieved.

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Why am I here?
Share Vision + What we are doing
My Vision about: Create a Better World
 Create a marketplace for what a Better World means. A market for “Vision”
 Create a marketplace for those who care about something (a “Vision”) to do more about it
(i.e. put money/actions where your mouth is)
 Create a marketplace for those who believe they have a particular skill that can add significant
value to achieving a “Vision” to receive the resources for them to scale and achieve
 Create a marketplace for people who see solutions where others see unsolvable problems
 Create a marketplace where “a non-political/non-controversial Social result” can be a
profitable/economically viable pursuit (versus a martyrdom)
 Create a marketplace where labels don’t matter as much as specific measurable results do
 Create a marketplace where such people and organizations are seen as the most admired and
effective leaders/professionals

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Executive summary: A Market for Breakthroughs
 A Deutsche Bank Quality of Life Index measures the progress (“Current State [C]”) between any Defined
“Starting State [A]” and another “Desired State [B]” of issues that affect the quality of life of our clients
 Deutsche Bank’s GME – Structuring group then issues index-linked securities (and makes markets for
them) with one or more of many possible payout structures, bringing together (and meeting the different
needs of) multiple groups of people that have at least one thing in common: The achievement of a highly
ambitious/unprecedented Desired State [B]
 The ultimate objective is to create a new market dynamic that will, directly or indirectly, significantly
increase the odds of achieving Desired State [B]. This new dynamic should allow an increase in focus,
financial resources, and non-financial/creative resources destined towards the ambitious objective [B].
 Therefore, this new market should present a compelling value proposition to individuals, corporations,
endowments & foundations, development organizations, governments, non-profit non-governmental
organizations, social entrepreneurs. In general, for anyone who has a strong desire for an ambitious
“Desired State [B]” which can be described as “for the common good of any given community”
 It is important to note that this new for-profit market is highly complimentary and supportive of any parties
currently involved in the pursuit of social causes. Revenues generated by Deutsche Bank will be highly
efficient and value enhancing for these parties, as compared to their current situation
 Our clients can invest in an existing Quality of Life Market (off-the-shelve Desired State [B]), or can work
with us to sponsor and/or seed a new Market. Each new Quality of Life Index is co-sponsored with an
independent interested partner, and it is governed by an independent Quality Control Board, an
Ombudsperson, and an Arbitration Panel

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 Deutsche Bank’s Quality of Life Indices (DBQoLs)
 DB Quality of Life Index-linked Securities & Markets
 Implementation Strategies and Value Propositions
 Timeline of creating a Quality of Life Market
 Sample of DB Quality of Life Markets under development
 Deutsche Bank’s added value and revenue sources
 Contact information
Contents

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Generic structure of a DB Quality of Life Index
A
B
 A Deutsche Bank Quality of Life Index measures the
progress (or “Current State [C]”) between any given
Defined “Starting State [A]” and another Defined
“Desired State [B]” of issues that affect the quality of
life of our clients
C
 “Desired State [B]” should be:
(i) Highly ambitious or unprecedented
(ii) Measurable, and
(iii) The least controversial

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Possibilities of DB Quality of Life Indices®
are endless
Topics Sub-topics Geography/Segment
Health/Safety
Education
Economic/Wealth
Environment
Justice/Freedom
Cultural/Art
Increase in safety standards
Disease eradication
Increase in education levels
Art/cultural dissemination
Scientific development
Poverty reduction
Employment growth
Crime reduction
Culture preservation
Environmental planning/targets
Access to Justice
Peace
Municipal
State/National
Regional
Global
By any other segmentation

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Index design and governance
 Deutsche Bank works with Founding Client/Partner/Contributor to design an index that is creative,
measurable, simple, transparent and effective for the objective
 Once launched, each index should be calculated with little-to-none controversy throughout its life
 In this sense, the index governance structure is meant only to become active in three cases
- It is no longer practical or economical to use original data sources,
- Any Index Stakeholder becomes concerned that the existing data sources have become
corrupted in such a way that violates the original intent of the index, or
- To make decisions in unforeseen circumstances,
 In order to retain the original Spirit of the Index. The index governance structure includes
- A Measurement Quality Control Board,
- An Ombudsperson, and
- An Arbitration Panel

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Creating a market-dynamic
that works for the desired result
 Deutsche Bank’s GME – Structuring group can issue a wide variety of DBQOL index-linked securities
with one or more of many possible payout structures
 The idea behind the set of structures is to bring together (and meet the different needs of) multiple
groups of people that have at least one thing in common: The achievement of a highly
ambitious/unprecedented Desired State [B]
 In order to start understanding the market dynamics that these securities could inject and immense
possibilities that they present, it is important to understand two extremes of the universe of potential
index-linked payout structures: Security #1 and #2
Security # Principal Is Desired State [B] met at Maturity? Payout at Maturity
1 $100 Yes 0
No ($100+$x)*(1+R)n
2 $x
f(Security 1’s
Principal)
Yes ($100+$x)*(1+R)n
No 0

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Two extremes of the universe of potential
index-linked payout structures
Deutsche Bank or
Alternative “Issuer” or “Vehicle”Security 1
Security 2
If Desired State [B]
is met then 5,
else 6
$100
$x
Y= ($100+$x)*(1+R)
n
1
2
4
6
5
Investor 1
Investor 2
3
1. Investor 1 buys Security 1 at $100 with Maturity n=15. Security 1 is issued by TBD (DB or alternative “Issuer” or “Vehicle”).
Assets held in “Trust-like” vehicle, in some sort of principal protected structure (e.g. 15-year PPN + MSCI World)
2. Investor 2 buys Security 2 at $x with same Maturity Date as Security 1. Amount $x is presumably a function of Security 1’s value,
and at issue is expected to be a low percentage of Security 1’s value. Security 2 is issued by TBD
3. At or before Maturity, Security 1 and Security 2 have mutually excluding claims to Y, defined as $(100+x)*(1+R)
n
, where R is a rate
of return net of fees (TBD)
4. If Desired State [B] is met at or before maturity, then Security 2 has full claims to Y (5) , else Security 1 has full claims to Y (6)

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Two broad avenues
 Current Deutsche Bank Quality of Life Markets under development include Global Infant and Child
Mortality-related, Global Sanitation-related, Latin-American Millennium Development Goals-related, and
more…
 Deutsche Bank’s GME – Structuring can custom-design a new market that fits specifically the Desired
State [B] that a client wants to sponsor
Client
Participate and help
expand/reinforce
existing
Quality of Life Market
Custom design, sponsor,
and “launch” a new
Quality of Life Market
Customized,
innovative solution
to achieve
Desired State [B]

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Custom-designed solutions towards [B]
 Deutsche Bank’s GME – Structuring designs solutions based on clients’ particular approach/situation
relative to Desired State [B], not based on their traditional classification. Some examples include:
Traditional
Classification
Common
objective
Particular approach/situation/context DB Quality of Life strategy/
Value proposition
 Individual
 Corporation
 Endowment/
Foundation
 Pension Fund
 Institutional Investor
 Hedge Fund
 Development
Organization
 Government
 Non-Governmental
Organization
 Social Entrepreneur
 Manager/Technician
 Venture Capitalist
 ….
Achieve
Desired
State [B]
Wants to spend/invest/”donate” contingent
upon satisfactory results (reaching [B])
Deutsche Bank works with clients to issue “Security 1”
linked to an existing Quality of Life Index or custom-design
a new one. Deutsche Bank will then help create this
Market by (i) raising more investor interest into that
security and (ii) Creating demand for corresponding
“Security 2”, and (iii) then constantly matching secondary
buyers and sellers
Believes to know the right implementation to
achieve [B], but lacks sufficient financial
resources to execute
Deutsche Bank will help identify existing appropriate
“Security 1”, “Security 2” or set of them, that can be used
directly or re-structured for this purpose
Believes a cause requires more human
talent/competition than currently applied to it,
more creative strategies applied to [B]
This market and targeted strategies create many
possibilities to recruit talent from any business/industry
Believes more buy-in is required by society
and/or governments to achieve cause
Customized strategies such as targeted selling of Security
2 can be implemented
Believes the achievement of the cause is a
win-win proposition, but social causes are not
its line of business
Deutsche Bank can structure notes in which balance sheet
or asset base is used in an efficient manner consistent
with organization’s mandate

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The bottom line value proposition: The Result
 This new for-profit market is highly complimentary and supportive of any parties currently involved in the
pursuit of any Desired State [B] such as a social cause
 Each new market’s unique strategies are designed to increase the total financial and non-financial
resources applied to it. Most importantly, to increase the odds of achieving Desired State [B] by a
multiple of 7 to 20 times the odds of accomplishing it without the Quality of Life Market
Desired State [B]
Increase the total
financial and non-Financial
resources towards
Desired State [B]
Increase the odds
of achieving
Desired State [B]
anywhere from 7 to 20 times

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Timeline of entire process of bringing to life each index
and index-linked securities..
Phase Timeline
1. Work with Client to Identify Quality of Life “Factor”
2. Create with Client appropriately-framed and governed DB Quality of Life Index
3. Seed “Incentive/Conditional/Prize Pool” (Security 1), define terms
4. Raise funds for Security 1 from other interested parties (non-seeding Investors)
5. Build “Venture/Management” interest (i.e. market Security 2)
6. Auction off Rights to interested bidders (i.e. issue Security 2)
7. Monitor performance/ make a secondary market for Securities 1 and 2
8. Maturity: Make corresponding payments

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Accelerate the Reduction of
Global Infant and Child Mortality
 The Challenge: An estimated 10 million children 0-5 years old die every year. Most of them from
preventable diseases. This means that one out of every twelve children born annually is estimated to die
prior to turning five years of age
 The context of the DB Quality of Life Market’s construction/ Sponsors: Deutsche Bank approached
Faculty from Harvard University’s School of Public Health/ JFK School of Government in order to create
Index. Hoping to launch a related market, also complimentary with Market being created with Ashoka
(the global association of the world’s leading social entrepreneurs) related to Global Sanitation
(Children’s deaths and lack of sanitation are highly correlated)
 Desired State [B]: The desired state is to reduce mortality rates at least twice as fast on the next 15
years as any other previous fifteen year period in history
- Achieving this objective would mean saving the lives of an estimated 8 million children annually
- Furthermore, the externalities or implications of a world (and individual societies) that takes care
of its children, fulfills the basic human rights of health, appreciates life
 Current Status:
- Building expressions of interest for “Security 1”-type
- Building expressions of interest for “Security-2”-type
- Open to partnership for more narrowly focused (regional/local)-related markets

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Solve the increasing
Global Sanitation Challenge
 The Challenge: Front Page of The Lancet: “Adequate Sanitation is the most effective public health
intervention the international community has at its disposal. Yet 40% of the world’s population still lacks
access to a toilet”. For more than 1.1 billion people around the world, water is a constant concern. Where
will their next drink come from? Will it be clean? Will it last? Suitable sanitation facilities are in even
shorter supply. Basic human privacy and dignity are lost to 2.6 billion people who have no place to use
the bathroom. And these problems will get worse. In the near future, water scarcity will lead to even
greater suffering for the world's poorest.
 The context of the DB Quality of Life Market’s construction/ Sponsors: DB is working with Ashoka
(the global association of the world’s leading social entrepreneurs) and the Mannweiler Foundation inc.
(creators of the L3C concept) among others to design the appropriate DBQoL Indices and linked-
securities that may help this cause
 Desired State [B]: TBD
 Current Status:
- Working group with Ashoka to design appropriate DBQoL Indices
- Building expressions of interest for “Security 1”-type
- Building expressions of interest for “Security-2”-type
- Open to partnership for more narrowly focused (regional/local)-related markets

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Catching up with Latin-America’s
Millennium Development Goals and reaching further
 The Challenge: Latin America, as a region, exhibits several areas of persistent underdevelopment
despite many years of free-market reform, economic growth and embracing of stable democracy.
the Inter-American Development Bank to explore ways to work together to enhance the pace of
development in Latin America
 Desired State [B]: TBD (various being considered)
 Current Status:
- Working group with President’s Office to propose initial $500m action plan to Board
- Building expressions of interest on regional Latin American issues

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Helping to create a common vision of
a first-world Peru, and channel the required resources
 The Challenge: Peru, as a country, exhibits several areas of persistent underdevelopment despite
many years of free-market reform, economic growth and embracing of stable democracy.
Grupo Interbank to explore ways to work together and develop a market that works for developmental
causes in Peru
 Desired State [B]: TBD (various being considered)
 Current Status:
- Working group with Grupo Interbank designing relevant indices
- Building expressions of interest on country-specific Peruvian issues
- $50m already committed on behalf of Corporations and underwritten by Deutsche Bank

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Deutsche Bank’s added value and revenue sources
 Deutsche Bank’s GME – Structuring group is a for-profit entity and it has developed this capability in order to
support either for-profit and/or not-for-profit organizations in pursuit of objectives that are non-political and not
conflicting with our business practices
 As stated previously, Deutsche Bank’s Quality of Life Markets are highly complementary and supportive of any
parties currently involved in the pursuit of social causes. Revenues generated by DB will be highly efficient and
value enhancing for these parties, as compared to their current situation
 Each new market’s unique strategies are designed to increase the total financial and non-financial resources
applied to it. Most importantly, to increase the odds of achieving Desired State [B] by a multiple of 7 to 20 times
the odds of accomplishing it without the Quality of Life Market. No market is launched where Deutsche Bank is
not encouraged to do so by a reputable interested party
 Deutsche Bank and partners have the potential to earn revenues on one or more of this market’s related
activities:
- Fees for raising funds for Securities 1 and 2
- Fees for making secondary markets for Securities 1 and 2
- Possibly, Fees from holding assets in DB or partner-issued securities
- Possibly, gains from principal investing on Securities 1 and/or 2
- Other

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Contact information
 Contact your Deutsche Bank Representative to learn more or schedule a meeting,
or the following people:
GME – Structuring (Developers of Quality of Life Markets)
Keith Cunningham (212) 250-8866
Guillermo MacLean (347) 776-1404
Latin American-based (Investors, Corporates and
Governments (and DC-based Latin Multilaterals))
Ivan Santillan (212) 250-6324
US Endowments and Foundations
John Kidd (212) 250-9905
Cornelia Spiegel (212) 250-9905
German-speaking countries (Investors, Corporates and
Governments)
Jobst Hoyningen-Huene (4969) 910-46653
US Mid-size and small Endowments and Foundations
Sean Lane (212) 454-1985
US and Europe-based Investors in Emerging Markets
Rupert Hope (212) 250-6226

Publicly available General Introduction to Deutsche Bank Quality of Life Markets 2007

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