Allied World Assurance 8-K Other Events

-ConverttoE2-FileonBSE-SetatPN1&upI11ISSPresentation8292011(2).pdfY9249511

Thispresentationcontainsforward-lookingstatementsthatinvolveanumberofrisksanduncertainties.Statement sthatarenothistoricalfacts,includingstatementsaboutourbeliefsandexpectations,areforward-lookingstate ments.Anyforward-lookingstatementsmadeinthispresentationreflectAlliedWorld’scurrentfutureeventsandfi nancialperformanceandaremadepursuanttothesafeharborprovisionsofthePrivateSecuritiesLitigationReformA ctof1995.Suchstatementsinvolverisksanduncertainties,whichmaycauseactualresultstodiffermateriallyfrom thosesetforthinthesestatements.Forexample,theseforward-lookingstatementscouldbeaffectedbytheoccurren ceofanyevent,changeorothercircumstancesthatcouldgiverisetotheterminationofthemergeragreement;theinab ilitytoobtainAlliedWorld’sorTransatlantic’sshareholderapprovalorthefailuretosatisfyotherconditionsto completionofthemerger,includingreceiptofregulatoryapprovals;risksthattheproposedtransactiondisruptse achcompany’scurrentorecognizeplansthebenefitsandofthemerger;operations;theamountofthecosts,fees,expe nsesandchargesrelatedtothemerger;pricingandpolicytermtrends;increasedcompetition;theimpactofactsofte rrorismandactsofwar;greaterfrequencyorseverityofunpredictablecatastrophicevents;negativeratingagency actions;theadequacyofAlliedWorld’slossreserves;-U.S.subsidiariesbecomingsubjecttosignificantincometa xesintheUnitedStatesorelsewhere;changesinregulationsortaxlaws;changesintheavailability,costorquality ofreinsuranceorretrocessionalcoverage;adversegeneraleconomicconditions;andjudicial,legislative,polit icalandothergovernmentaldevelopments,aswellasmanagement’sresponsetothesefactors,andotherxchangefacto rsCommissionidentified(“SEC”)innottoplaceunduerelianceontheseforward-lookingstatements,whichspeakonl yasofthedateonwhichtheyaremade.AlliedWorldisundernoobligation(andexpresslydisclaimsanysuchobligation )toupdateorreviseanyforward-lookingstatementthatmaybemadefromtimetotime,whetherasaresultofnewinforma tion,futuredevelopmentsorotherwise.AdditionalInformationAbouttheProposedMergerwithTransatlanticandWh eretoFindItThispresentationrelatestoaproposedmergerbetweenAlliedWorldandTransatlantic.Inconnectionwi ththeproposedmerger,AlliedWorldhasfiledwiththeSEC,andtheSECdeclaredeffectiveonAugust18,2011,aregistr ationstatementonFormS-4thatincludesajointproxystatement/prospectusthatprovidesdetailsoftheproposedme rgerandtheattendantbenefitsandrisks.Thiscommunicationisnotasubstituteforthejointproxystatement/prosp ectusoranyotherdocumentthatAlliedWorldorTransatlanticmayfilewiththeSECorsendtotheirshareholdersincon nectionwiththeproposedmerger.Investorsandsecurityholdersareurgedtoreadthejointproxystatement/prospec tus,andallotherrelevantdocumentsfiledwiththeSECorsenttoshareholdersastheybecomeavailablebecausetheyw illcontainimportantinformationabouttheproposedmerger.Alldocuments,sec.gov)when.Youmayfiled,alsoobtai nthesewillbedocumentsbycontactingAlliedWorld’sDupont,atAlliedWorldCorporateAssuranceCompanySecretary         ,Holdings,AG,Lindenstrasseattn.8,6340Baar,:WesleyZug,DSwitzerland,orviae-mailatsecretary@awac.com;or bycontactingTransatlantic’sInvestorRelationsdepartmentatTransatlanticHoldings,Inc.,80PineStreet,NewY ork,NewYork10005,orviae-mailatinvestor_relations@transre.com.Thiscommunicationdoesnotconstituteanoff ertosellorthesolicitationofanoffertobuyanysecuritiesorasolicitationofanyvoteorapproval.Participantsi ntheSolicitationAlliedWorld,Transatlanticandtheirrespectivedirectorsandexecutiveofficersmaybedeemedt obeparticipantsinanysolicitationofproxiesinconnectionwiththeproposedmerger.InformationaboutAlliedWor ld’sdirectorsmentdatedMarch17,2011andforitsexecutive2011AnnualMeetingofShareholders.Informationabout Transatlantic’sdirectorsandexecutiveofficersisavailableinTransatlantic’sproxystatementdatedApril8,20 11forits2011AnnualMeetingofShareholders.Otherinformationregardingtheparticipantsintheproxysolicitati onandadescriptionoftheirdirectandin directinterests,bysecurityholdingsorotherwise,iscontainedinthejoi ntproxystatement/prospectusandmaybecontainedinotherrelevantmaterialstobefiledwiththeSECregardingthem ergerwhent heybecomeavailable.Investorsshouldreadthejointproxystatement/prospectuscarefullybeforemakinganyvotin gorinvestmentdecisions.ISSPresentation8292011(2).pdfY9249522

IONALE:Berkshire’sdiscountforTRHTRANSALLIEDshareholdersMERGERDELIVERSAWHofferssuperiorcurrencyversus ValidusSUPERIORProcessconsiderations“INTRINSIC“ANDISSPresentationLONG-TERM8292011(2).pdfVALUEY924953

ialtyfocusedLeadingspecialtyreinsurerreinsuranceandinsuranceleaderFlexibleinternationalplatformsTrul yglobalplatformwithcapitalU.S.-domiciledcompanywithinSwitzerland,Ireland,Hongefficienciesglobalfootp rintKong,Singapore,BermudaandtheU.S.IndustryleadingmanagementBalancedmanagementstructureIndustrylead ingmanagementteamwithbesttalentdrawnfrombothteamorganizationsSuperbspecialtyfranchisewithComplementa ryproductsandWell-respectedpropertydirectinsurancedistributiondistributionwithlimitedoverlapcatastro phe/short-taillinesandlong-tailreinsurancecapabilitiesRatings:A/A/A2(1)Enhancedcombinedratingprofile Ratings:A+/A/A1(1)Risktolerance:1:250PMLlessSimilarconservativeriskandRisktolerance:1:250post-taxtha n20%ofcapital(current:underwritingstandardswithPMLlessthan20%ofequity11%)flexibilitytoopportunistica lly(current:16%)(2)expandISSPresentation(1)Financial8292011(2)strength.pdfratingsfromS&P/A.M.Best/Mo ody’s.Y924954(2)Basedonpost-taxFloridawindPMLasdisclosedinTRHQ2201110-Q.4

altakeoverproposalDiversifiedspecialtyfocusedreinsuranceandCombinesdecentralizedcompetingplatforms,i nsuranceleaderwithrisktoeliminateTRH25+yearoldiconicreinsurancefranchiseCombinationlacksmeaningfulUS insuranceTrulyglobalplatformwithcapitalefficienciesfranchise;Capitalinefficienciesduetolackofwellcap italizedinternationalvehiclewithEuropeanpassport(exLloyd’s)Balancedmanagementstructurewithbesttalent Highpersonnelflightriskandlossoftalentdrawnfrombothorganizationsvs.Complementaryproductsanddistribut ionwithInefficientoverlapinpropertycatbookslimitedoverlapEnhancedcombinedratingprofileIncreaseinrisk profile,limitinggrowthopportunitiesandpotentiallyleadingtolowerratingsSimilarconservativeriskandunde rwritingRisktoleranceinexcessofTRHstandardsstandardswithflexibilitytoopportunisticallyexpandStrategi crationaleacclaimedbyanalystStrategicrationalequestionedbyanalystcommunitycommunityISSPresentation82 92011(2).pdfY9249555

lbemorediversifiedandconsiderablylessexposedtocatastrophelossesCatastrophelossesas%equity(1)Lessvola tilityMorevolatility40.0%36.1%35.0%1.7%31.7%31.5%29.6%30.0%2.4%1.9%2.7%25.7%25.7%25.6%15.6%24.2%23.7 %25.0%5.8%2.0%1.7%2.0%23.1%1.0%12.3%2.4%15.7%19.3%20.0%18.1%10.0%1.4%10.6%10.9%11.5%15.9%8.8%2.6%4.7 %1.7%7.6%15.0%13.5%14.0%1.9%9.6%12.6%2.1%6.5%2.3%4.3%6.0%2.5%1.6%4.2%1.6%5.3%2.7%1.5%9.2%10.0%4.3%4. 4%2.9%3.9%4.2%2.8%1.2%5.2%2.3%6.0%12.4%3.0%3.7%2.6%2.1%5.0%9.4%1.6%8.9%7.8%6.9%7.3%6.9%6.7%7.4%1.9%5         .0%4.8%5.8%5.5%4.6%4.5%2.7%3.0%0.0%PTPMRHPREVRAXSVR/RNRREAHLTRH

TransENHACGLAWHALTEXLACETRHAlliedIke&Gustav-2008Chile&Xynthia-2010NewZealand-2010Australia-2010Austr alia/NewZealand/Japan-Q12011Q22011(1)BasedonendingTotalShareholders’EquityfortheperiodpriorSource:SN LFinancial,CompanyfilingsY924956ISSPresentation8292011(2).pdf6 $E_BNE_US_Standard            UDP8: Invisible Text ^pStrongercreditprofileandriskman agementpotentiallyleadingtohigherproformaratings(continued)TransAlliedwouldhavesignificantlylowerPML riskasapercentageofequityasaresultofahigherdiversification28%~28%Exceeds~20%risktolerance16%16%14%AW HTRHTransAlliedVRTRHPFVR/TRHNote:CombinationofAWHorVRwindoccurrence,respectively,andTRHFloridawind1: 250PMLs,asapercentageofequity,withoutaccountingforoverlap.After-taxratesforTransAllied,VRandTRHassum edatcomparablelevels...andwouldmaintainleverageflexibilityundercurrentTotalfinancialleverage(1)23.3% 21.2%19.2%TRHTransAlliedPFVR/TRH(1)Totalfinancialleverageisequaltototaldebtplushybrids/totalcapitala sof6/30/11.Y924957ISSPresentationSource:Company8filings292011(2).pdf7

ancialStrengthRatingsAgencyreactionsValidusunsolicitedconditionalTRHAWHVRtakeoverproposal“Giventheir complementarybusinessprofilesandminimal“Theandnegativebid,ifsuccessful,implicationscouldforhaveTrans atlanticpositivecredit...Validus’implicationsproposalforValidusoffersoperationsoverlap,webelievethem ergeriscreditpositiveasitprovidesstrategicbenefitstoeachcompany.higherpressureconsiderationonthecapi talbut,structureduetothethancashacomponent,stock-for-stockputsmoremergerMoody’sA1A2A3Theproposedtran sactionisanall-stockmergerthatwedonot“TheValidusproposalwouldleadFSR:Underexpectwillputadditionalpre ssureTransatlantic’scurrentondisposition,eitherwhichmayfirm’snotbeconsistentwithreviewforTransatlant ic’scurrentratingsgiventhenewcapitalstructure.“possiblestructure.“Moody’s,JulyupgradeMoody’s,June20, 2011“AlliedCreditWatchPositiveWorldFollowingAssuranceMergerAnnouncementandSome“TransatlanticRatingso nValidusRatings—)HoldingsremainPutunchangedonfollowingtheinsurancecompany’sunsolicitedoffertocombin ewithCreditWatchWehaveplacedwiththepositiveratingsonimplicationsAlliedWorldbecauseanditsbeingoperati ngpartofunitsaonTransatlanticHoldingsInc.leadingposition.globalreinsurancegroupcouldimproveitscompet itivecompaniesAlthoughweasdon’taresultplanofanStandard&developmentsandcouldplaceourratingsonbothVali dusandA+AA-WehavealsoplacedtheratingonTransatlanticonCreditWatchTransatlanticonCreditWatchiftheoffer succeeds.Poorspositivebecauseofpossiblenarrowednotchingbetweentheholding-CCRFSR&CCRcompanyandoperati ng-companyratings.“Inaddition,althoughValidussuccessfullyintegratedIPCin2009CreditWatchCreditWatchan dTalbotin2007,wethinkamergerwithTransatlanticwouldPositivePositiveStandard&Poor’s,June13,2011likelyb eamoreformidabletask.“Standard&Poor’s,July13,2011“Theunchangedratingsfollowingtheannouncement.ofAlli edThistransactionWorldbringstwoand“A.Transatlantic(Excellent)M.andBestissuercreditCo.ratingandofhas” a-“oftheirValiduscommentedReinsurance-predominantlycomplementaryaprimaryorganizationswriterandtogeth er.TransatlanticWithAlliedapureWorldreinsurer,beingtheLtd.“bb+”,asandwell“bb“astheofseniorICRofdebt, “bbb-“subordinatedandtheindicativedebtandratingspreferredof“bbb-”,stockmergedentityisexpectedtoenjoy anenhancedbusinessprofilethatshelfregistration,respectively,ofValidusHoldings,Ltd.areA.M.BestAAA-wil llikelyinsurebenefitsintheformofanimprovedcompetitiveunchangedfollowingtherecentunsolicitedofferbyVa lidusTheposition.mergedentityshouldalsobenefitfrombroaderdistributionHoldingstoacquireTransatlanticH oldingsInc.“channels,broaderproductdiversityandthebenefitsofasignificantglobalpresence.“A.M.Best,Jul y14,2011A.M.Best,June13,2011Note:ISSFSR:Presentationfinancialstrength829rating;2011CCR:(2)counterpar ty.pdfcreditrating.Y9249588

citedconditionaltakeoverproposal0changesEquityresearchanalystrecommendationchanges2downgradesfollowi ngtransaction/proposalannouncement“Thisdealmakessenseinourview...Thedealprovidesaplatformandbetter“T RHtransactionmorecomp

licatedandgreateruncertainty...WhileVRhasabalancebyproduct,geographyandlong-andshort-taillines.While neitherplayerproventrackrecordofexecutingacquisitions,webelieveTRHtransactionwouldbewaslargeinproper ty-CAT,thecombinedentityshouldbeabletoallocatemoremorecomplicatedthanVR’sacquisitioncapitaltopropert y-CATlines,particularlyasCasualtyuncertaintylinesremainwithchallenged.respectto“TRH’sCitigroup,June1 2,2011integrationofTRHwouldlikelyUBS,July13,2011“WeviewthecombinationasattractivefortheTRHshareholde rs...Whilethe“Atthispoint,itisverydifficultdiscounttobookvaluemaybesomewhatdisappointing,wewouldstre ssthatthewouldexpectinvestorstoremainsomewhatskepticalofthesepotentialbenefitsshareshavetradedataste epdiscounttobookforaprolongedperiod.Transatlanticuntiltheyaremoreevident.willbepartofalargerglobalen tityunderawell-respectedmanagementteam.Inaddition,theremaybeopportunityforadditionalmarginthroughtax arbitrage.OverDuetothepotentialforEPSdilutionandamoreconservativeassumedprice/booktime,thecombinatio nmayfarebetterthanTRHmayhavedonealone.“multiplereflectingalowerexpectedROEandgreaterreserverisk,wear eloweringKeefe,Bruyette&Woods,June12,2011ourpriceobjectiveonValidus...reflecting-termandaddedriskint hebookvalueduetothecasualtylossreservestobeassumedfromTRH.“BankofAmericaMerrillLynch,July13,2011“The mergerofequalstransactionmakesstrategicsense.AWHshareholdersbepleasedthatthedealproducesdifferentiab lesizeanddiversification,positiveattributesthatwouldhavebeendifficulttoobtainorganicallyinthecurrent “Whyafriendlydealisimportant—thepotentialfordisintermediationishighwhenenvironment...Integrationcom binedriskscompanyseemmanageable,theintegrationandtheisnotperceivedwellwouldseemtobebetterpositionedt oweatherthisperiodoftheindustrycycle.Citigroup,July12,2011LangenMcAlenney,June13,2011“Webelievethiss light[VRoffer]premiumisoffsetbytheconsensualnatureof“Thedeallooksaccretivetotangiblebookvalue...ther eislikelypotentialtheAWHtransaction,forthecostsimilarculturesofAWHandTRH,andthesavings,structuralben efitsandadditionalcapitalmanagementgivenastrongnumerousfinancialbenefitsoutlinedbyAWH/TRHmanagemento nseveralbalancesheetposition.“occasions...wedonotseeacompellingreasonSterne,Agee,&Leach,June13,2011o fferassubstantiallysuperior“Keefe,Bruyette,&Wood,July12,2011ISSPresentation8292011(2).pdfY9249599

HexchangeratioTRHshareholdersOfferexchangeratio0.8800x1-yearaveragesharepricesasoflasttrading$57.35$ 49.600.8650x2%daypriortoTransAlliedannouncement2Q’11Book-to-bookexchangeratio—0.8712x1%Averageprice sbetween61.2651.470.8402x5%1/1/11to3/13/11(a)TRHpeersetonlasttradingday58.0750.550.8705x1%priortoTra nsAlliedannouncement(b)SharepricesonlasttradingdaypriortoTransAlliedannouncement58.0744.010.7579x16% (a)3/13/11representsbeginningofexclusivediscussionsbetweenAWHandTRH.(b)TRHimpliedpriceifitweretradin gat0.78xP/Bmultiple,in-linewithaverageofpeersetatdateofannouncement.Source:SNLFinancial,Companyfilin gsISSPresentation8292011(2).pdfY924951010

rformanceValidus1-daysharepriceperformancelikelylessinfluencedbymergerarbitrageactivitybecause:VRpro posalincludedcashcomponentlessshortingactivitytypicallytakesplaceincontestedsituationslower1-dayprem iumasofrespectiveannouncementAWHVR(4.5%)(9.1%)(11.0%)(10.2%)(20.1%)1-dayfollowingSinceannouncementSi nceVRproposalannouncementofAWH/TRHmerger(7/13/11)agreement(6/13/11)1-dayfollowingannouncementSinceVR proposal(7/13/11)Note:Marketdataasof8/26/2011.Source:CapitalIQISSPresentation8292011(2).pdfY92495111 1

AWHAveragesince7/13:3.7%toSpread2.0%0.0%(2.0%)7/127/137/147/157/187/197/207/217/227/257/267/277/287/ 298/18/28/38/48/58/88/98/108/118/128/158/168/178/188/198/228/238/248/258/26unaffectedNote:Basedoncur rentstockpricewhichdoesnotincludefullvalueofsynergiesandearningstoclose.Source:CapitalIQISSPresentat ion8292011(2).pdfY924951212

TRHshareholdersretainmajorityTRHshareholderslosemajorityTRHshareholdersarecashedoutwithnoupsidepoten tial58%ownership48%ownership100%stockconsiderationCashconsiderationlimitsanyallowsparticipationinful lfuturevalueupsidefuturevalueupsideFaireconomicswithexchangeratioOpportunisticattempttoacquireOpport unisticattempttoacquirebasedonpremiumtobook-for-bookTRHatadouble-digitdiscounttoTRHata~25%discountto year-endexchangeratio,whichisindustrybook-for-bookexchangeratiobookvaluestandardBalancedmanagementst ructureVRmanagementtakeoverUncertainBest-in-classskillsdrawnOverlapinoperationsimpliesfromeachorgani zationlossoftalentduetohighflightriskTRHtoappointmajorityofUncertainBoardrepresentationforUnlikelybo ardrepresentationforTransAlliedBoardTRHTRH6DirectorsfromTRH,5fromAWHISSPresentation8292011(2).pdfY92 4951313

callyatadiscountTheTransAlliedmergeroffersTRHshareholdersa2.5%premiumtobook-for-bookexchangeratiowhi letheValidusproposalrepresentsa~12%discounttobook-for-bookAWHVRBerkshire1.5564xVRsharesOfferterms0.8 800xAWHshares$52.00incash+$8.00cashStockconsiderationandintrinsicvaluevsQ1book-(b)0.8581x1.7644x81%o fFDbookvaluedeliveredtoofferedgrowsoverfor-book(a)2.5%premiumtoTRH(11.8%)discounttoTRHTRHvaluetimevs         .staticcashoffer,explainingdecliningbookvaluemultiplestovsQ2book-closingfor-book0.8712x1.8178x(b)78% ofFDbookvaluedeliveredto(a)1.0%premiumtoTRH(14.4%)discounttoTRHTRHvaluevsQ4Ebook-0.8687x(b)1.8145x75 %ofFDbookvaluedeliveredtofor-book(a)1.3%premiumtoTRH(14.2%)discounttoTRHTRHvalue(a)Book-for-bookexch angeratiosbasedonfullydilutedsharesusingTreasuryStockMethod,asof8/26/11forQ2andQ4E,8/2/11forQ1.Q4Eca lculatedbasedonconsensusestimates.(b)Adjustedtotakeintoaccount$8.00ofcashconsiderationpershare.Sourc e:CapitalIQ,CompanyfilingsISSPresentation8292011(2).pdfY924951414

enuesynergiesandincrementalexcesscapitalupside$4.54$73.44$2.77intangibleSynergies$2.80TBD$66.10$63.7 3$2.77$2.59Earningstointangibleclose(b)$8.00cashshare$70.67tangibleTRH$1.22Q2perintangibleBVPS$52.00 value$63.33tangibleIntrinsic$51.93Q2tangibleBVPSTransAlliedEarningstoclose(b)Synergies(c)Totalimplie dintrinsicVRimpliedintrinsicBerkshireQ2BVPS(a)valuevalue(a)(b)(a)Q2basicproformabookvaluepershareasp errespectiveS-4filings.(b)Basedonconsensusestimates,netofdividends.(c)Synergiespersharecalculatedbas edonmid-pointof5.0x-7.0xP/Emultiplesrangeappliedtorun-rateISSPresentation829estimated2011(2)synergie s.pdfof$80million.Y924951515

scapitalupsideValidusBerkshireDetailedduediligenceanddisciplinedHighlyspeculativeestimatesbasedBerks hireofferprovidesforpre-mergerintegrationplanningsolelyonlimitedreviewofpublicduezerosynergyparticip ation$80mmofrun-rate(after-tax)annualdiligenceoperatingandstructuralbenefitsPreliminaryestimatesincl udeareaswith$50mmrealizedinyear1suchasinvestmentportfolioConservativeestimates,donotoptimizationandr evenuesynergiesnotincludesynergiesrelatedto:factoredintoAWH’sconservativeestimates—investmentportfo liooptimization—revenueenhancements—cededreinsurancesavingsExpandedglobalnetworkandMeaningfulbusin essoverlapforcesinfrastructurecreatesadditionalfutureeliminationofpremiumsandresultsingrowthopportun itiesandenhancednegativerevenuesynergiesearningspotential$500mmincrementalexcesscapitalestimateMinim albusinessoverlapandmeaningfulbusinessdiversificationcreatesignificantincrementalexcesscapitalandenh ancedfinancialflexibilityOver$1bnexcesscapitalestimate$3.78to$5.29perTRHshare(a),Given58%ownershipin AWHdealvs.$0Synergyvalueexcludesanyrevenuesynergiesor42%VRdeal,every$ofsynergiesincrementalexcesscap italupsidegeneratedresultsinagreatergaintoTRHshareholdersinAWHtransaction(a)Basedon5.0x—7.0xP/Emult iplerange.ISSPresentation8292011(2).pdfY924951616

(8/26)Currentpeermultiples(8/26)(a)$65.17$4.54$60.63TBU$52.00$52.00$47.57$45.47$46.30AWHVRBHAWHVRBH1 yearaverageP/B(b)SincerespectiveIPOsaverageP/B(c)$67.93$4.54$56.90$4.54TBUTBU$63.39$55.93$57.60$52.3 6$52.00$52.00AWHVRBHAWHVRBHNote:Q4E’11bookvaluespersharecalculatedbasedonlyst2Q’11actualsestimates.( a)PeergroupforAWHbasedonDeutscheBankfairnessopinion(RLI,WRB,MKL,HCC,ACGL,NAVG,AXS,ENH,AHL,AGII);peer groupforVRbasedonISSanalysisincontextofVR/IPCtransaction(TRH,ACGL,PRE,AWH,RE,ENH,AXS,PTP,AHL,RNR,MRH         ,FSR,ALTE).ImpliesP/Bmultipleof0.88xforAWHand0.71xforVR.(b)Representsperioduntilunaffecteddate(6/10/ 11).BasedonP/Bmultipleof0.76xforAWHand0.86xforVR.(c)Representsperioduntilunaffecteddate(6/10/11).Bas edonP/Bmultipleof0.92xforAWHand0.89xforVR.Y9249517ISSPresentation8Including292011estimated(2).pdfsyn ergyvalueasperpage15calculation.Source:SNLFinancial,Companyfilings17

pliedmarketvaluation(8/26)Currentpeermultiples(8/26)(a)$68.68$4.54$64.15TBU$52.00$52.00$45.47$46.30$ 46.71AWHVRBHAWHVRBH1yearaverageP/B(b)SincerespectiveIPOsaverageP/B(c)$68.02$4.54$60.75TBU$4.54TBU$63         .48$57.07$59.25$56.21$52.00$52.00AWHVRBHAWHVRBHNote:Q4E’11bookvaluespershareactualsandearningscalcul atedanddividendspersharebasedasperresearchonanalyst2Q’11estimates.(a)PeergroupforAWHbasedonDeutscheB ankfairnessopinion(RLI,WRB,MKL,HCC,ACGL,NAVG,AXS,ENH,AHL,AGII);peergroupforVRbasedonISSanalysisincon textofVR/IPCtransaction(TRH,ACGL,PRE,AWH,RE,ENH,AXS,PTP,AHL,RNR,MRH,FSR,ALTE).ImpliesP/TBmultipleof0         .97xforAWHand0.71xforVR.(b)Representsperioduntilunaffecteddate(6/10/11).BasedonP/TBmultipleof0.85xfo rAWHand0.90xforVR.Y9249518(c)Representsperioduntilunaffecteddate(6/10/11).BasedonP/TBmultipleof0.96x forAWHand0.94xforVR.ISSPresentation8292011(2).pdfIncludingestimatedsynergyvalueasperpage15calculatio n.18Source:SNLFinancial,Companyfilings

discountforTRHSection2shareholdersBERKSHIRE’SOFFERAWHofferssuperiorcurrencyversusValidusCEMENTSDISCO UNTProcessconsiderationsFORTRHSHAREHOLDERSISSPresentation8292011(2).pdfY9249519

iaovertime(quarterly)40%36%50%35%43%33%34%45%40%41%35%32%28%28%40%30%28%34%33%33%34%26%26%35%32%30%3 2%%22%%25%27%27%21%30%Premiato25%23%22%20%20%20%21%1-day20%15%PremiumPremium15%12%10%Berkshireoffer: 10%Berkshireoffer:15%premium(a)5%15%premium(a)5%0%0%00010203040506070809101H’11Median52-weekpremiaov ertime(annual)Median52-weekpremiaovertime(quarterly)20%20%15%16%14%15%12%12%11%12%%%10%7%Premiato8%6 %5%4%4%5%5%3%3%2%2%1%1%1%52-weekhigh4%1%0%1%1%2%1%1%1%1%Premium0%Premium0%0%(4%)(5%)(3%)Berkshireoff er:Berkshireoffer:(5%)4%discount(b)(10%)(8%)4%discount(b)00010203040506070809101H’11Note:Includesall -cashconsiderationM&AtransactionswithUStargetsover$500mm.Excludestransactionsinvolvingrealestateandg overnments.Excludessharebuy-backs.(a)PremiumcomputedbasedonTRH’sclosingpriceof$45.24on8/5/11,Berkshi re’soffer.(b)DiscountcomputedbasedonTRH’sclosingpriceon11/4/10of$54.ISSPresentationtothe829announcem ent2011(2).pdfofBerkshire’soffer.Y9249520Source:SDCThomson,CapitalIQ20

of1.69xequalsAcquisitions(a)1.60x1.20xAcquisitionmultipleaverage:1.16xbook0.97x/0.83xPrice0.80x0.78x 0.79x0.40x0.00xBerkshireallcashofferValidus/IPCPartnerRe/ParisReSCOR/ConveriumMaxCapital/HarborPoint Note:Price-to-bookcalculatedasofannouncementdate.Shownonafullydilutedbasis.(a)IPCshareholdersreceive d.9727Validussharesand$7.50incashforeveryIPCsharetheyowned.ParisReshareholdersreceived0.3PartnerResh aresforeveryParisResharetheyowned.Converiumshareholdersreceived0.5SCORsharesand$4.52incashforeveryCo nveriumsharetheyownedISSPresentation829Source:2011SNL,(2)Company.pdffilings,MoelisfairnessopiniontoT ransatlanticBoarddeliveredonJune12,2011andasY9249521disclosedinS-4proxyfiledonAugust17,2011.21.

ferential:$18.75Valuedifferential:$7.00$52.00$52.00LowHighBerkshireOfferDCFNote:Calculatedusingadisc ountrateof9.3%to10.3%forTransatlantic.Source:MoelisfairnessopiniontoTransatlanticBoarddeliveredonJun e12,2011andasdisclosedinS-4proxyfiledonAugust17,2011Y9249522ISSPresentation8292011(2).pdf22

discountforTRHSection3shareholdersAWHofferssuperiorAWHOFFERScurrencyversusValidusSUPERIORCURRENCYPro cessconsiderationsVS.VALIDUSPROPOSAL

hsinceAWHIPO(1)140%96%AnnualizedshareholderreturnfromrespectiveIPOdates(2)6%10%Totalshareholderretur nfromrespectiveIPOdates(3)84%55%Five-yearaverageoperatingROAEfrom2006—2010(4)20%15%Catastrophelosse saspercentageofequity(5)14%30%Three-yeartotalnetinvestmentreturn2008—2010(6)15%10%Capitalreturnedto shareholdersoverpast5years$1.6bn$1.3bn(1)Growthinbookvaluepersharecalculatedbytakingchangeinbasicboo kvaluepersharefromSeptember2006throughJune2011,adjustedfordividendspaid.(2)Bloombergannualizedtotals hareholderreturnsbasedonpriceonrespectiveIPOdates(7/12/06forAlliedWorldand7/25/07forValidus)and8/26/ 11closingprice.Assumesdividendsarereinvestedinrespectivecompany’s(3)Basedonclosingpriceonrespe

ctiveIPOdates(July11,2006forAlliedWorldandJuly24,2007forValidus)andJune10,2011closingprice.Assumesdi videndsarereinvestedinrespectivecompany’sstock.(4)Asreportedbycompany.(5)Sumofcatastrophelossesfor20 08throughJune2011expressedasapercentageofequityfortheperiodprecedingeachoccurrence.(6)Totalnetinvest mentreturnincludesnetinvestmentincome,netchangeinunrealizedgainsandnetimpairmentchargesrecognizedine arnings.Thepercentagereturniscalculatedbytakingthetotalnetinvestmentreturnforthethreeyearsdividedbyt heaverageaggregateinvestedassetsforthesameperiod.Y9249524ISSNote:PresentationDataforValidus8prior29t o2011Validus(2)IPO.pdfdateobtainedfrompubliclyavailableinformation.Source:SNLFinancial,Companyfiling s,Bloomberg24

hebetbyTRHshareholdersiswhowillcompoundTangibleBV/shareatafasterclipovertime.Inthelast5years,VRhasco mpoundedvaluecreation(TangibleBV/share+cumulativedividend)by14%annuallyvs.18%forAWH.“Dowling&Partner sSecurities,July15,20115-yearvaluecreation21%18%18%18%17%17%16%15%15%Peeraverage:15%14%14%13%12%9%6% ACGLAWHENHACERNRPREAHLAXSMRHVRPTPRETRHALTEFSRNote:5-yearhorizonfromQ22006throughQ22011,asestimatedby Dowling.(1)Totalvaluecreationdefinedasannualizedgrowthintangiblebookvaluepershareplusaccumulateddivi dends.Source:Dowling&PartnersSecurities,July15,2011AlliedWorldhasoutperformedValidusinvaluecreationb y29%

ncerespectiveIPO(b)8%10%6%1%(a)Bloombergannualizedtotalshareholderreturnsbasedonaclosingpricedateof8 /26/2011.(b)BloombergannualizedtotalshareholderreturnsbasedonIPOpriceonrespectiveIPOdates(7/12/06for AlliedWorldand7/25/07forValidus)andaclosingpricedateof8/26/11.AssumesdividendsarereinvestedinY924952 6ISSPresentationrespective8292011(2).pdfcompany’sstock.

06—20102010operatingROEAlliedWorld20%RLI15%Arch19%Arch14%RLI17%AlliedWorld13%Berkley17%Axis12%Axis1 7%Aspen12%Endurance17%Berkley12%Validus15%Endurance12%HCC14%HCC11%Aspen14%Transatlantic9%Markel14%Ma rkel9%Transatlantic13%Validus9%Navigators11%Navigators6%Argo8%Argo4%0.0%5.0%10.0%15.0%20.0%25.0%0.0% 5.0%10.0%15.0%20.0%Note:Periodfrom2006throughQ12011...withlowervolatilityAlliedWorld’sinvestmentretu rnshaveoutperformedandcombinedratioasaresultofalowerexposuretoValidus’throughavolatile(a)marketenvir onment...propertycatastrophelosses15%198%10%6%74%27%4%12%1-year3-yearStandarddeviationofDilutedEPSSt andarddeviationofCombinedAWHVR(3years)Ratio(sinceVRIPO)AWHVRNote:DataforValiduspriortoValidusIPOdate obtainedfrompubliclyavailableinformation.Standarddeviationshownasapercentageofmean.Basedonquarterlyd ilutedEPSandcombinedratiofigures,respectively.(a)Dataasof12/31/10.AlliedWorldhasanaverageportfoliodu rationof2.3yearsasof6/30/11vs.1.6yearsforValidus,asaresultofY9249527ISSPresentationValidus’higher829 2011(2)exposure.pdf-tailpropertycatastrophetoshortbusiness.Source:Companyfilings

rproposal100%stock-for-stocktransactionallowsTRHshareholdersto$8.00cashconsiderationpershareandincre asedleveragethatpreservesignificantupsidevaluelimitsfutureequityupsideAWHhasmorevaluablespecialtyins urancemix,implyingQuestionablego-forwardvalueduetostatedstrategychangesignificantlygreatervaluationu psideandshiftinbusinessmixTaxandcapitaleffici

entglobalplatformwhichmeetsregulatoryLackofwell-capitalizedinternationalvehiclewithEuropeanneeds(Sol vencyII)passport(excludingLloyd’s)GreaterexcesscapitalprovidesstrategicandleverageflexibilityLevered capitalwithhighercatastropheriskOptimizepropertycatastrophebusinessifratesincreasefurtherCapitalmana gement/returntoshareholdersAlliedWorldhasreturned27%morecapitaltoshareholdersoverthepast5years$1.6bn 13%$1.3bn6%AWHVRAWHVRSharerepurchasesanddividends($billions)Averagecapitalmanagementas%ofpriorperiod equity

discountforTRHshareholdersSection4AWHofferssuperiorPROCESScurrencyversusValidusProcessconsiderations CONSIDERATIONS

lidusunsolicitedconditionalBerkshireunsolicitedconditionaltakeoverproposaltakeoverproposalSigneddefi nitivemergeragreementwithInourview,desperateattempttodisruptNoprocessforconsensualtransactioncouldtr ansactionbeginuntilAWH/TRHmergeragreementisshareholdervotesscheduledonSept.20,2011Uncertaintyrelated toHurricaneseason,whichterminated—ifprocessbeginsatallmaychangeVRplansFullreciprocalduediligencecom pleteProposalbasedonlyonreviewofpublicNodiligencerequiredinformation,duediligencestillrequiredValidu shasrefusedtoenterintoconfidentialityagreementtoconductduediligenceofTRHValidusfiledlitigationagains tTRHandAWHinlightofTRH’sinsistenceonexecutionofstandstill;inresponsetoskepticismbytheDelawareChancer yCourtastostrengthofValidus’sclaims,Validushasrecentlywithdrawntherequestforexpeditedtreatmentofitsl itigationFastandclearpathtocompletionUncertainandlongroadtocompletionSeveralmonthstoreceiveregulator yWouldrequireTRHBoardapprovalapprovalsafteranysigningofamergerProxyfiledandeffectiveHSRseveralforeig n(withdrawalofpoisonpill)agreementearlyterminationandExchangeofferwillrequireregulatoryantitrustappr ovalsobtainedfiledapprovalswhichwilltakelongerthanFormAwithNYInsuranceTransAllied(willalsochangetaxa ttributes)DepartmentNoprocessforconsensualtransactioncouldbeginuntilAWH/TRHmergeragreementisterminat ed—ifprocessbeginsatallUncertaintimingforregulatoryapproval,likelyseveralmonthsaftersigningdefiniti veagreementEarlyQ4’11closeUncertaintimetable,notlikelyuntilEarliestpotentialcloseyear-end20122011

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