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LaSalle and Trenwick merged in a stock-for-stock merger. Each side had financial

advisors and each side’s stockholders approved the merger. The reality that the financial

markets believed each company had positive economic value and that the resulting

Trenwick has positive value is ignored in the complaint.

C. The Allegations That Trenwick’s Directors And Officers Somehow Enriched Themselves By The Chartwell And LaSalle Transactions

At all relevant times, the Trenwick board was comprised almost entirely of

directors who were not officers of Trenwick. Only one of the Trenwick directors was an

executive, James F. Billett, Jr. Although the complaint does not bother to identify his

title, Billett was the CEO of Trenwick during the period when the challenged transactions

occurred.

The complaint’s allegations regarding the incentives of the Trenwick directors,

frankly, make no economic sense. The complaint alleges that the Trenwick directors

entered into the Chartwell and LaSalle mergers in order to enrich themselves but in a way

that somehow “had nothing to do with earning a profit for shareholders or timely paying

creditors, and everything to do with bonuses, gold parachutes, ego, and greed.”33

This inflammatory, albeit banal, rhetoric is unaccompanied by pled facts

supporting the assertion. At most, the complaint alleges that as part of the LaSalle

acquisition, the Trenwick directors “received bonuses and stock (and cash in lieu of

fractional shares) in the newly-formed” Bermuda holding company for their pre-existing

33

. ¶ 35.

25

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