Washington Group International Inc – ‘8-K’ for 7/24/01 – EX-99.2

On:  Thursday, 8/2/01, at 4:34pm ET   ·   For:  7/24/01   ·   Accession #:  912057-1-526327   ·   File #:  1-12054

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         5     16K 
 2: EX-99.1     Miscellaneous Exhibit                                 39    238K 
 3: EX-99.2     Miscellaneous Exhibit                                955±  5.67M 

EX-99.2   —   Miscellaneous Exhibit
Exhibit Table of Contents

EX-99.2
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                                                                    Exhibit 99.2

 IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF NEVADA

-------------------------------------                                           
                      )     Case No. BK-N-01-31627
In re                                )     (Chapter 11)                         
)     
WASHINGTON GROUP                     )     DISCLOSURE STATEMENT WITH            
INTERNATIONAL, INC., ET AL.,         )     RESPECT TO SECOND AMENDED JOINT      
                         )     PLAN OF REORGANIZATION OF
                               )     WASHINGTON GROUP INTERNATIONAL,
            )     INC., ET AL.
)     
)     
Debtors.                             )                                          
-------------------------------------)                                          

David S. Kurtz                             Jennifer A. Smith (State Bar No. 610)
Timothy R. Pohl                            Etta L. Walker (State Bar No. 5537)  
SKADDEN, ARPS, SLATE, MEAGHER              LIONEL SAWYER & COLLINS              
& FLOM (ILLINOIS)                       1100 Bank of America Plaza        
333 West Wacker Drive                      50 W. Liberty St.                    
Chicago, Illinois 60606                    Reno, Nevada 89501                   
(312) 407-0700                             (775) 788-8666                       

Gregg M. Galardi                                                                
Eric M. Davis                                                                   
SKADDEN, ARPS, SLATE, MEAGHER                                                   
& FLOM LLP                                                                
One Rodney Square                                                               
Wilmington, Delaware 19899                                                      
(302) 651-3000                                                                  

Attorneys for the Debtors and 
Debtors-in-Possession         

Dated:   July 24, 2001                                                          

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DISCLAIMER

             THE INFORMATION CONTAINED IN THIS DISCLOSURE STATEMENT IS
INCLUDED HEREIN FOR PURPOSES OF SOLICITING ACCEPTANCES OF THE SECOND AMENDED    
JOINT PLAN OF REORGANIZATION (THE "PLAN") OF WASHINGTON GROUP INTERNATIONAL,    
INC. AND ITS AFFILIATED DEBTORS AND DEBTORS IN POSSESSION AND MAY NOT BE RELIED 
UPON FOR ANY PURPOSE OTHER THAN TO DETERMINE HOW TO VOTE ON THE PLAN. NO PERSON 
MAY GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS, OTHER THAN THE INFORMATION
AND REPRESENTATIONS CONTAINED IN THIS DISCLOSURE STATEMENT, REGARDING THE PLAN  
OR THE SOLICITATION OF ACCEPTANCES OF THE PLAN.                                 

         ALL CREDITORS ARE ADVISED AND ENCOURAGED TO READ THIS
DISCLOSURE STATEMENT AND THE PLAN IN THEIR ENTIRETY BEFORE VOTING TO ACCEPT OR  
REJECT THE PLAN. PLAN SUMMARIES AND STATEMENTS MADE IN THIS DISCLOSURE STATEMENT
ARE QUALIFIED IN THEIR ENTIRETY BY REFERENCE TO THE PLAN AND THE EXHIBITS AND   
SCHEDULES ANNEXED TO THE PLAN AND THIS DISCLOSURE STATEMENT. THE STATEMENTS     
CONTAINED IN THIS DISCLOSURE STATEMENT ARE MADE ONLY AS OF THE DATE HEREOF, AND 
THERE CAN BE NO ASSURANCE THAT THE STATEMENTS CONTAINED HEREIN WILL BE CORRECT  
AT ANY TIME AFTER THE DATE HEREOF.                                              

                  THIS DISCLOSURE STATEMENT HAS BEEN PREPARED IN ACCORDANCE WITH
SECTION 1125 OF THE UNITED STATES BANKRUPTCY CODE AND RULE 3016 OF THE FEDERAL  
RULES OF BANKRUPTCY PROCEDURE AND NOT NECESSARILY IN ACCORDANCE WITH FEDERAL OR 
STATE SECURITIES LAWS OR OTHER NON-BANKRUPTCY LAW. THIS DISCLOSURE STATEMENT HAS
BEEN NEITHER APPROVED NOR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION 
(THE "SEC"), NOR HAS THE SEC PASSED UPON THE ACCURACY OR ADEQUACY OF THE        
STATEMENTS CONTAINED HEREIN. PERSONS OR ENTITIES TRADING IN OR OTHERWISE        
PURCHASING, SELLING OR TRANSFERRING SECURITIES OR CLAIMS OF WASHINGTON GROUP    
INTERNATIONAL, INC. OR ANY OF THE AFFILIATED DEBTORS AND DEBTORS-IN-POSSESSION  
IN THESE CASES SHOULD EVALUATE THIS DISCLOSURE STATEMENT AND THE PLAN IN LIGHT  
OF THE PURPOSE FOR WHICH THEY WERE PREPARED.                                    

            AS TO CONTESTED MATTERS, ADVERSARY PROCEEDINGS AND OTHER
ACTIONS OR THREATENED ACTIONS, THIS DISCLOSURE STATEMENT SHALL NOT CONSTITUTE OR
BE CONSTRUED AS AN ADMISSION OF ANY FACT OR LIABILITY, STIPULATION OR WAIVER,   
BUT RATHER AS A STATEMENT MADE IN SETTLEMENT NEGOTIATIONS. THIS DISCLOSURE      
STATEMENT SHALL NOT BE ADMISSIBLE IN ANY NON-BANKRUPTCY PROCEEDING NOR SHALL IT 
BE CONSTRUED TO BE CONCLUSIVE ADVICE ON THE TAX, SECURITIES OR OTHER LEGAL      
EFFECTS OF THE PLAN AS TO HOLDERS OF CLAIMS AGAINST, OR EQUITY INTERESTS IN,    
WASHINGTON GROUP INTERNATIONAL, INC. OR ANY OF THE AFFILIATED DEBTORS AND       
DEBTORS-IN-POSSESSION IN THESE CASES.                                           

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 OVERVIEW OF THE PLAN AND CHAPTER 11 CASES

                THE FOLLOWING INTRODUCTION AND SUMMARY IS A GENERAL OVERVIEW
ONLY, WHICH IS QUALIFIED IN ITS ENTIRETY BY, AND SHOULD BE READ IN CONJUNCTION  
WITH, THE MORE DETAILED DISCUSSIONS, INFORMATION AND FINANCIAL STATEMENTS AND   
NOTES THERETO APPEARING ELSEWHERE IN THIS DISCLOSURE STATEMENT AND THE SECOND   
AMENDED JOINT PLAN OF REORGANIZATION OF WASHINGTON GROUP INTERNATIONAL, INC. AND
ITS AFFILIATED DEBTORS AND DEBTORS IN POSSESSION (THE "PLAN"). All capitalized  
terms not defined in this Disclosure Statement have the meanings ascribed to    
such terms in the Plan. A copy of the Plan is annexed hereto as APPENDIX A.     

           This Disclosure Statement contains, among other things,
descriptions and summaries of provisions of the Plan being proposed by the      
Debtors dated as of July 24, 2001. Negotiations with respect to certain issues  
are ongoing, and the Debtors reserve the right to modify the Plan consistent    
with section 1127 of the Bankruptcy Code and Bankruptcy Rule 3019.              

A.       BUSINESS OVERVIEW                                                      

               Washington Group International, Inc. ("WGI") and its direct
and indirect subsidiaries, together with the various partnerships and joint     
ventures in which WGI or its subsidiaries participate (collectively, the        
"Subsidiaries" and, together with WGI, the "Company"), is an international      
provider of a broad range of design, engineering, construction, construction    
management, facilities and operations management, environmental remediation and 
mining services to diverse public and private sector clients. In fiscal 2000,   
the Company had revenue of approximately $3.2 billion.                          

         As discussed in more detail below, as a result of the
acquisition of certain businesses from Raytheon Company in July 2000, the       
Company experienced a liquidity crisis beginning in early 2001, which ultimately
led to the commencement, on May 14, 2001, of reorganization cases (the "Chapter 
11 Cases") under Chapter 11 of the United States Bankruptcy Code for WGI and    
certain of WGI's direct and indirect Subsidiaries (collectively, the "Debtors").
COMPANIES OR ENTITIES (SUCH AS JOINT VENTURES AND WESTINGHOUSE GOVERNMENT       
SERVICES COMPANY LLC AND ITS SUBSIDIARIES) THAT ARE NOT WHOLLY-OWNED BY WGI, AND
FOREIGN ENTITIES, (COLLECTIVELY, THE "NON-DEBTOR SUBSIDIARIES"), HAVE NOT       
COMMENCED CASES UNDER CHAPTER 11 OF THE BANKRUPTCY CODE AND CONTINUE TO OPERATE 
THEIR BUSINESSES IN THE ORDINARY COURSE UNAFFECTED BY THE DEBTORS' CHAPTER 11   
CASES. THE NON-DEBTOR SUBSIDIARIES ARE LISTED ON SCHEDULE 1.67 TO THE PLAN.     

           During the quarter ended September 1, 2000, the Company
reorganized its businesses to operate through five operating units: Power,      
Infrastructure & Mining, Industrial/Process, Government, and Petroleum &        
Chemicals. These units serve different markets and customers, and differ in     
their expertise, technology and resources necessary to perform their services.  

               POWER provides engineering, construction and operations and
                 maintenance services in both nuclear and fossil power markets
              for turnkey new power plant construction, plant expansion,
  retrofit and modification, decontamination and
               decommissioning, general planning, siting and licensing and
environmental permitting.                   

            INFRASTRUCTURE & MINING provides diverse engineering and
                 construction and construction management services on highways
                 and bridges, airports and seaports, tunnels and tube tunnels,
                  railroad and transit lines, water storage and transport, water
                  treatment, site development, mine operations and hydroelectric
         facilities. The group generally performs as a general
       contractor or as a joint venture partner with other
       contractors on domestic and international projects.

                 INDUSTRIAL/PROCESS provides engineering, design, procurement,
             construction services and total facilities management for
            general manufacturing, pharmaceutical and biotechnology,
             process, metal processing, institutional buildings, food,
       automotive and consumer products for the aerospace,
     telecommunications and pulp and paper industries.

                 GOVERNMENT provides a complete range of technical services to
         the U.S. Departments of Energy and Defense, including
                  operations and management services, environmental and chemical
             demilitarization services, waste handling and storage and
               weapons stockpile support. Services provided for commercial
           clients include design and manufacture of components of
               nuclear power facilities, safety management services, waste
           and environmental technology, design and manufacture of
radioactive waste containers and licensing. 

           PETROLEUM & CHEMICALS provides technology, engineering,
              procurement and construction services to the petroleum and
        chemical industries worldwide. Major markets include
          commodity-organic chemicals, polymers, Fischer-Tropsch
               chemistry, fertilizers, oleochemicals, petroleum processing
and lube oil processing.                    

                 The Company's core businesses have been financially sound and
profitable, and the need for a financial restructuring in Chapter 11 is the     
direct result of the significant unknown liabilities embedded in certain        
construction projects acquired in the Raytheon                                  

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transaction. Generally, the Company's customers include, to a large degree,     
Fortune 500 companies and government entities. Projects on which the Company    
works often take years to complete, and may require financial commitments of up 
to hundreds of millions of dollars from the project owners. As discussed in more
detail below, many of these project owners are understandably reluctant to award
new work to a company in Chapter 11, and the ability to procure new work on an  
ongoing basis is the lifeblood of an engineering and construction company.      
Accordingly, the Company believes that in order to maintain and create new value
in its businesses, the Debtors' Chapter 11 Cases must proceed on a fast-track   
basis, with the restructuring under the Plan completed as quickly as            
practicable.                                                                    

B.       THE RAYTHEON TRANSACTION                                               

            On July 7, 2000, WGI acquired the businesses of Raytheon
Engineers & Constructors International, Inc. ("RECI") from Raytheon Company     
("Raytheon"). The acquisition was pursuant to a Stock Purchase Agreement, dated 
as of April 14, 2000 (the "Stock Purchase Agreement"), among WGI, Raytheon and  
RECI. Under the Stock Purchase Agreement, WGI purchased the capital stock of the
subsidiaries of RECI and certain other assets of RECI and assumed certain       
liabilities of RECI (the "RE&C Businesses"). Prior to such purchase, RECI       
provided engineering, design, procurement, construction, operation, maintenance 
and other services on a worldwide basis.                                        

              Because of the size and complexity of the businesses being
sold to WGI, the Stock Purchase Agreement did not contain a fixed purchase price
for the transaction, but rather provided that the purchase price would be       
calculated using an audited balance sheet and a cut-off balance sheet for the   
RE&C Businesses, both as of April 30, 2000, along with other related documents, 
and that the price paid at closing of the transaction would be subject to a     
purchase price adjustment. The acquisition of the RE&C Businesses closed on July
7, 2000 (the "RE&C Businesses Acquisition"). WGI paid a cash purchase price of  
$53 million at closing and assumed certain liabilities, which, in the           
preliminary unaudited April 30, 2000 balance sheet provided by Raytheon, were   
estimated to be approximately $450 million.                                     

                After closing, WGI obtained access to the complete books and
records of the RE&C Businesses acquired from Raytheon and to key project        
management. WGI took over the management and administration of the RE&C         
Businesses and began to uncover the true state of the RE&C Businesses.          
Additionally, post-closing, WGI expected Raytheon to comply with its obligations
to diligently pursue the purchase price adjustment process. Pursuant to various 
agreements reached between WGI and Raytheon, the date by which Raytheon and RECI
were to deliver to WGI the audited April 30, 2000 balance sheet and related     
certifications for the purchase price adjustment process was extended to January
14, 2001. Such documents were not delivered to WGI at that time and had not been
delivered by May 14, 2001. As a result of the litigation pursued by WGI in the  
District Court for Ada County, Idaho (the "Idaho Court") against Raytheon, as   
discussed below and in SECTION V.I.1, Raytheon was ordered to provide to WGI    
documents necessary to commence the purchase price adjustment process by June 5,
2001, and the Idaho Court appointed an independent accountant to resolve any    
disputes. On June 5, 2001, Raytheon provided, pursuant to court orders, an      
unaudited April 30, 2000 balance sheet and cut-off balance sheet, which are the 
starting documents for the purchase price adjustment process. WGI responded to  
those documents on June 29, 2001. Both WGI and Raytheon are required to present 
materials to the independent accountant supportive of their respective positions
on or before July 30, 2001. Accordingly, WGI has not been able to finalize the  
purchase price for the transaction consummated by the Stock Purchase Agreement, 
but that process is being pursued.                                              

               On October 23, 2000, WGI reported its results for the third
quarter of 2000. In its Form 10Q filing, WGI reported that, as a result of its  
preliminary assessment of the RE&C Businesses, WGI increased the amount of the  
liabilities it assumed by over $700 million, and increased its goodwill arising 
out of the acquisition by over $700 million from the amount WGI had expected to 
book to approximately $1.2 billion. WGI's review is ongoing and it continues to 
uncover significant, previously undisclosed, adverse facts about the assets     
acquired, as well as Raytheon's inappropriate accounting for those assets.      

                  As a result of its continuing post-acquisition in-depth review
of the RE&C Businesses acquired, the Debtors believe that Raytheon management   
consistently engaged in inappropriate accounting practices and intentional      
earnings manipulation by overstating revenue and assets, understating costs,    
avoiding recognition of losses and thereby severely overstating profits and     
assets and understating losses on numerous projects. Consequently, on March 8,  
2001, WGI filed suit against Raytheon and RECI in the Idaho Court, alleging     
fraud and seeking rescission and, alternatively, unspecified damages and        
specific performance for breach of the Stock Purchase Agreement. Other than the 
preliminary injunction related to the Purchase Price Adjustment process, that   
dispute was stayed in favor of an arbitration commenced by Raytheon on March 27,
2001 seeking declaratory relief as to which a counterclaim was filed by WGI     
involving the same issues raised in the Idaho Court action. The arbitration is  
being held in abeyance, at this time, as a result of WGI's Chapter 11 filing.   
The Debtors also will assert claims against Raytheon pursuant to an action that 
will be commenced in the Bankruptcy Court on or before August 3, 2001 under,    
among others, sections 544, 547, 548 and 550 of the Bankruptcy Code. See SECTION
V.I.1 for a summary of the Raytheon litigation. As discussed in Section VII.C,  
under the Plan, all such claims and causes of action will be assigned to the WGI
Creditor Trust, which will be funded with $20 million to prosecute such claims. 

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                The results of WGI's acquisition of the RE&C Businesses were
disastrous for the Company. As a direct result, the Company encountered a severe
near-term liquidity crisis, defaulted on certain covenants in its credit        
facilities, and became unable to secure performance bonds necessary to obtain   
certain new jobs, thus impeding the Company's ability to obtain certain future  
work. Contrary to Raytheon's stated annual $140 million EBITDA that would be    
produced from the acquisition of the RE&C Businesses, these assets have failed  
to produce the represented results and Raytheon's failure to disclose losses    
embedded in certain contracts is directly responsible for the Company's         
deteriorated financial condition and the commencement of these Chapter 11 Cases.

           Raytheon disputes all claims asserted against it by the
Company and asserts significant claims against the Debtors. SECTION C of this   
Overview immediately below, and APPENDIX D to this Disclosure Statement, were   
drafted by Raytheon and contain statements by Raytheon regarding its disputes   
with the Debtors. The Debtors dispute Raytheon's assertions in these statements 
in virtually all material respects.                                             

C.       RAYTHEON STATEMENT REGARDING DISPUTES WITH THE DEBTORS                 

    Raytheon vigorously disputes WGI's claims of misrepresentation and
fraud by Raytheon and believes that those charges are a subterfuge for WGI's    
mismanagement of a huge acquisition that it now regrets. Raytheon is WGI's      
largest creditor, and expects to present a proof of claim in the range of $900  
million. Claims against Raytheon are not a net asset, as the Debtor would have  
creditors believe; at best they may serve to reduce the amount of Raytheon's    
claim. Accordingly, Raytheon believes that no class 7 creditor will receive any 
value under the plan. The plan proposed by WGI is a going concern collateral    
liquidation proposed by WGI solely for the benefit of the banks and WGI         
management.                                                                     

        At the core of all of the disputes between Raytheon and the Debtors is
a Stock Purchase Agreement dated as of April 14, 2000 ("SPA"). Pursuant to the  
SPA, Raytheon and an affiliate on July 7, 2000 conveyed to one of the Debtors   
the stock of a variety of subsidiaries constituting its E&C business, as well as
certain related assets. In addition, the SPA contains a detailed set of         
substantial obligations that remained executory as of the Petition Date. Some of
these run in favor of Raytheon; some in favor of the Debtors. The               
financially-significant items running in favor of Raytheon are (i) the Debtors' 
absolute obligation to indemnify Raytheon against all project risk on most of   
the sold business, including exposure under letters of credit, guaranties, and  
surety bonds that have since been called, and (ii) the Debtors' obligation to   
pay to Raytheon a 75% share of all moneys received on a class of Debtor claims, 
the ("Retained Claims") after the first $30 million. The financially-significant
items running in favor of the Debtors are (iii) Raytheon's obligation to        
indemnify WGI against its actual out-of-pocket expenditure on a certain class of
potential third-party claims against the Debtor ("Specified Seller              
Liabilities"), (iv) a specific, project-by-project list of indemnities          
undertaken by Raytheon (as to which Raytheon has fully performed), (v)          
Raytheon's obligation to repurchase a class of Debtor receivables (the "RR      
Assets"), and (vi) a set of specific representations made by Raytheon as to     
which, in the event the Debtors could prove the elements of misrepresentation,  
they may receive up to (but no more than) $87.5 million.                        

       ITEM (vii). In addition, the SPA contains a purchase price adjustment
clause. Raytheon has presented an analysis showing that it is owed approximately
$13 million. The Debtor has presented an analysis claiming an adjustment in its 
favor in the amount of $469 million. While at this point, it is unclear which   
party that clause will benefit, it appears that the disparity in the analysis   
derives chiefly from the Debtor's failure to apply the deal-specific rules on   
project accounting, set forth in Schedule 3.3(a) to the SPA.                    

     Raytheon believes that the netting of the claims will result in the
members of Class 7 receiving no value under the Plan. Please see APPENDIX D for 
a brief summary of Raytheon's position with respect to the disputes between it  
and the Debtors.                                                                

D.       EXISTING CAPITAL STRUCTURE                                             

                  In order to finance the acquisition of the RE&C Businesses, to
refinance existing indebtedness outstanding at that time, and to provide        
additional working capital, WGI, various subsidiary guarantors of WGI (the      
"Guarantors"), Credit Suisse First Boston ("CSFB") as administrative and        
collateral agent, and various lenders (the "Prepetition Secured Lenders"),      
entered into a secured credit facility (the "Prepetition Senior Secured Credit  
Facility") that provided for $1.2 billion in availability. As of the Petition   
Date, obligations to the Prepetition Secured Lenders under the Prepetition      
Senior Secured Credit Facility totaled approxi mately $702 million, inclusive of
approximately $130 million in undrawn letters of credit outstanding. The        
obligations under the Prepetition Senior Secured Credit Facility are secured by 
liens on the assets of WGI and the Guarantors, subject to certain specific      
exceptions, which assets the Debtors and the Prepetition Secured Lenders believe
constitute substantially all of the value of the Company's businesses. The      
Prepetition Secured Lenders assert that they have liens on certain of the claims
against Raytheon to be transferred to the WGI Creditor Trust. Such liens, if    
any, will be released upon consummation of the Plan. See SECTION III.B.2 for a  
description of the Prepetition Senior Secured Credit Facility.                  

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            As of the Petition Date, WGI and the Guarantors were the
issuer and guarantors, respectively, of WGI's senior notes due July 1, 2010, in 
the principal amount of $300 million (the "Old Notes"). The Old Notes were      
issued pursuant to an Indenture dated as of July 7, 2000 and are unsecured.     
United States Trust Company of New York is the Indenture Trustee under that     
Indenture, and is a member of the Creditors' Committee. See SECTION III.B.3 for 
a description of the Old Notes.                                                 

          As of the Petition Date, the Debtors collectively were
indebted to vendors, subcontractors and other creditors as a result of ordinary 
course obligations in amounts exceeding $150 million. The Debtors also have     
disputed and/or contingent prepetition liabilities related to a variety of      
pending litigation claims. All of these obligations are unsecured. As discussed 
below and in SECTION V.B, the Debtors sought and obtained authority during the  
Chapter 11 Cases to pay certain of such claims in the ordinary course of        
business.                                                                       

            WGI's existing common stock (the "Old Common Stock") was
traded on the New York Stock Exchange. Approximately 39% of the Old Common Stock
is owned or controlled by Mr. Dennis Washington. SEE SECTION III.B.1. On May 14,
2001, the New York Stock Exchange ("NYSE") suspended trading of the Old Common  
Stock and initiated delisting procedures.                                       

E.       EXPLORATION OF STRATEGIC ALTERNATIVES AND PROCUREMENT OF DIP FINANCING 

           Faced with a severe liquidity crisis resulting from the
acquisition of the RE&C Businesses, in the months prior to the commencement of  
the Chapter 11 Cases, the Company began exploring alternatives to obtain        
additional liquidity and to preserve and maximize the value of their businesses 
for the benefit of creditors. In early 2001, the Company attempted to negotiate 
a settlement with Raytheon, which efforts were unsuccessful. In March, 2001, the
Company took the unprecedented step suspending performance on two projects      
acquired as part of the acquisition of the RE&C Businesses, but with respect to 
which Raytheon retained liability under guaranty agreements with the project    
owners. Those projects, which had particularly large cash flow requirements to  
complete, are projects to build two power plants in Massachusetts for entities  
affiliated with Sithe Energies, Inc. (collectively, "Sithe"). See SECTION V.I.2 
for a discussion of litigation commenced against the Debtors in the Bankruptcy  
Court by Mitsubishi Heavy Industries, Ltd. and Mitsubishi Heavy Industries      
America, Inc. (collectively "Mitsubishi"), a large vendor with respect to the   
Sithe projects.                                                                 

            Despite taking this action in an effort to preserve cash
resources, by April 2001, the Company had an acute need for additional cash     
liquidity to be able to continue to operate its businesses. Alternatives        
explored at that time included a sale of business units and the entire Company  
to potentially interested third parties, and obtaining additional debt financing
from the Prepetition Secured Lenders as well as from other lending institutions.
The Company was unable to obtain a proposal from any potential buyer that the   
Company and its Prepetition Secured Lenders believed reflected the fair value of
the businesses, and was unable to obtain a commitment for additional financing  
from any source outside of a Chapter 11 filing. Certain parties in interest     
dispute the adequacy of the Debtors' prepetition efforts to solicit potential   
sale proposals. SEE SECTION XII.B.                                              

                 The only committed financing proposal received by the Debtors
was a proposal for debtor-in-possession financing (the "DIP Facility") from a   
group of lenders (the "DIP Lenders"), many of whom are lenders under the        
Prepetition Senior Secured Credit Facility. The DIP Facility provides for up to 
$350 million of availability, of which $220 million is fully committed and the  
balance is to be made available upon request by the Debtors if sufficient       
commitments can be obtained from lenders. Obligations under the DIP Facility are
secured by first priority liens on substantially all of the Debtors' assets,    
senior to the liens securing the obligations to the Prepetition Secured Lenders.
Borrowing availability and use of funds under the DIP Facility is tied to an    
operating budget agreed to by the Debtors and the DIP Lenders. See SECTION V.C  
for a description of the DIP Facility.                                          

F.       PREPETITION PLAN NEGOTIATIONS AND COMMENCEMENT OF THE CHAPTER 11 CASES 

              As noted above, the Company concluded that the only way to
maintain its going concern value for the benefit of creditors, if a Chapter 11  
filing was to occur, was to seek to complete the Chapter 11 Cases and emerge    
from Chapter 11 as quickly as possible. Doing so is critical for numerous       
reasons, including that it is extremely difficult for the Company to be awarded 
new work while in Chapter 11. The difficulty in obtaining new work from project 
owners is exacerbated by the difficulty in obtaining surety bonds to assure     
project performance while in Chapter 11. Surety bonds are very often required by
project owners.                                                                 

               As a result, in conjunction with negotiations to obtain the
DIP Facility, the Company also conducted negotiations regarding the terms of a  
restructuring plan with the Prepetition Secured Lenders. In fact, the           
Prepetition Secured Lenders and the DIP Lenders conditioned their willingness to
provide the DIP Facility and the requisite consents thereto upon the Debtors    
filing a restructuring plan acceptable to them concurrent with the filing of the
Chapter 11 Cases. The Company also believed that commencing the Chapter 11 Cases
on a prearranged basis would expedite the process, benefitting all creditors.   
Accordingly, the Company negotiated the terms of a restructuring plan with such 
lenders prior to commencing these Chapter 11 Cases. That restructuring plan was 

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filed on May 14, 2001.                                                          

                On May 14, 2001, to obtain the ability to borrow funds under
the DIP Facility and to begin the process of restructuring the Company's balance
sheet, the Chapter 11 Cases were commenced. The Debtors immediately sought      
approval by the Bankruptcy Court of a number of motions designed to provide a   
smooth transition into Chapter 11 for the Debtors and to provide certain        
substantive relief designed to preserve the value of the Debtors' businesses.   
SEE SECTION I.G. This relief included interim approval of the DIP Facility,     
final approval of which was obtained on June 13, 2001.                          

           In addition, at the outset of the Chapter 11 Cases, the
Bankruptcy Court established certain dates designed to result in consummation of
the Debtors' reorganization plan as quickly as practicable. July 24, 2001 was   
set as the date for the Bankruptcy Court to consider approving this Disclosure  
Statement, and September 6, 2001 was set as the date to consider confirmation of
the reorganization plan.                                                        

             Subsequently, the Debtors, the Steering Committee for the
Prepetition Secured Lenders and Mr. Dennis Washington reached an agreement      
regarding continued participation by Mr. Washington in the management of the    
Company and the consideration to be given to Mr. Washington in exchange for his 
agreement to remain with the Company, which agreement is described below and in 
SECTION V.G. As a result, on June 22, 2001, the Debtors filed the First Amended 
Joint Plan of Reorganization, which reflected modifications to the plan as filed
on May 14, 2001, to encompass the agreement with Mr. Washington, but also       
contained a number of open items that at the time remained subject to ongoing   
negotiations. Additional modifications reflecting the results of those ongoing  
negotiations have been incorporated into the Plan.                              

G.       PAYMENT OF CRITICAL VENDOR CLAIMS                                      

            Trade creditors are the lifeblood of the engineering and
construction industry. Accordingly, the Debtors believe that it is critical to  
their ability to maintain operations and going concern value that certain       
"Critical Vendors" be paid in the ordinary course of business. These Critical   
Vendors include subcontractors and vendors that provide goods and services to   
the Debtors with respect to ongoing projects.                                   

                  To preserve the value of the Company's businesses, the Debtors
must continue to pay the Critical Vendors in ordinary course of business, for a 
number of reasons. For example, if the Debtors are unable to pay subcontractors 
and vendors relating to an ongoing project in the ordinary course of business,  
project owners will likely cease paying to the Debtors the payments owing to    
them under their underlying construction contracts. These payments would likely 
be diverted to the subcontractors and vendors directly. Also, subcontractors    
would literally stop working on the Debtors' projects absent payment in full,   
causing defaults by the Debtors and allowing project owners to call on surety   
bonds that assure the Debtors' performance. Doing so would trigger equitable    
subrogation rights of those sureties, which include the right to receive future 
project payments from owners. These events would eliminate the Debtors' ongoing 
revenue stream, crippling operations and destroying enterprise value.           

                 As a result, at the commencement of the Chapter 11 Cases, the
Debtors sought and received authorization from the Bankruptcy Court to continue 
to pay substantially all subcontractors and vendors on ongoing projects in the  
ordinary course of business. SEE SECTION V.B. A list of the Critical Vendors    
that have received payments to date or that are anticipated to receive such     
payments during these Chapter 11 Cases is attached hereto as APPENDIX E, which  
list is as current as practicable as of the date hereof. Total payments under   
the Critical Vendor order entered by the Bankruptcy Court are, as of the date   
hereof, approximately between $160 - $168 million.                              

H.       GENERAL STRUCTURE OF THE PLAN                                          

                 The Plan is premised upon the strategic business plan for the
Company going forward prepared by WGI's management (the "Business Plan"). The   
Business Plan and accompanying pro forma financial projections through fiscal   
year 2004 (the "Projections") are described in detail in SECTION V.L. While the 
Company believes that the Business Plan and Projections are reasonable and      
appropriate, they include a number of assumptions that may differ from actual   
results and are subject to a number of risk factors. SEE SECTIONS V.L.3 AND     
VIII. The Business Plan and Projections for the Company incorporate the         
Company's forecasts of the anticipated business performance of the Non-Debtor   
Subsidiaries.                                                                   

                The Plan provides for WGI's balance sheet to be restructured
by converting the obligations to the Prepetition Secured Lenders to equity, and 
by discharging the unsecured Claims of holders of the Old Notes and other       
general unsecured creditors (the "General Unsecured Claims"). General Unsecured 
Claims include all prepetition unsecured Claims other than Employee Claims.     
Under the Plan, Employee Claims will be Reinstated. The Plan also provides for  
the continued payment in the ordinary course                                    

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of business of Claims authorized to be paid during the Chapter 11 Cases pursuant
to orders entered by the Bankruptcy Court, such as the Claims of Critical       
Vendors.                                                                        

        Under the Plan, WGI will issue New Common Shares for
distribution to the Prepetition Secured Lenders, and the Old Notes and Old      
Common Stock will be cancelled. The distribution under the Plan of 100% of the  
New Common Shares of Reorganized WGI to the Prepetition Secured Lenders is      
premised upon the valuation of the Company prepared by the Debtors' financial   
advisors. See discussion below and SECTION XI.E. That valuation establishes the 
enterprise value of the Company as $555 million, at the midpoint of a range     
(exclusive of the value of claims and causes of action against Raytheon and its 
subsidiaries). Because the amount of funded debt projected by the Debtors to be 
on the Reorganized Debtors' consolidated balance sheet upon emergence from      
Chapter 11 is $50 million, the value of the New Common Shares to be issued under
the Plan, in the aggregate, has been established at approximately $505 million, 
subject to being reduced as a result of the issuance of the Washington Stock    
Options, which are described below.                                             

             The Claims of the Prepetition Secured Lenders exceed $570
million of funded debt, and also include approximately $130 million of          
contingent liabilities for undrawn letters of credit outstanding. Because the   
Prepetition Secured Lenders assert (and the Debtors do not contest) that the    
Prepetition Secured Lenders have liens on assets that comprise substantially all
of the value of the Company, and consistent with the valuation of the Company   
and the New Common Stock described above, under the Plan, (i) the Prepetition   
Secured Lenders' Claims are bifurcated into Secured Lender Claims and Lender    
Deficiency Claims, pursuant to section 506 of the Bankruptcy Code, (ii) the     
Secured Lender Claims are established in an amount equal to the value of the New
Common Shares to be issued and the Prepetition Secured Lenders are to receive   
under the Plan, which is approximately $505 million, which may be adjusted      
downward by the Confirmation Hearing as a result of the issuance of the         
Washington Stock Options (discussed below) and (iii) the Lender Deficiency      
Claims will be established by the Confirmation Hearing, based primarily upon the
amount of the Prepetition Secured Lenders' funded debt at that time minus the   
amount of the Secured Lender Claims.                                            

                  The Creditors' Committee contests that the Prepetition Secured
Lenders have liens on assets that comprise substantially all of the value of the
Debtors' businesses. The Creditors' Committee has filed a complaint to require  
the Senior Secured Lenders to establish the extent and validity of their liens. 
The Creditors' Committee also asserts that the valuation of the Company is      
higher than the valuation prepared by the Debtors' financial advisors. SEE      
SECTION XI.E. The Debtors and the Senior Secured Lenders dispute the Creditors' 
Committee's contentions.                                                        

            In addition, the Plan (i) provides for a trust (the "WGI
Creditor Trust") to be created to which substantially all claims and causes of  
action against Raytheon and its affiliates, agents and\or representatives,      
including the claims and causes of action to be asserted under sections 544,    
547, 548, 550 or any other section of the Bankruptcy Code (the "Raytheon        
Claims"), will be assigned and which will be funded with $20 million in cash to 
pursue such claims and (ii) provides for holders of General Unsecured Claims    
(which include, without limitation, the Lender Deficiency Claims, Old Note      
Claims, and any Claims asserted by Raytheon or its subsidiaries to the extent   
Allowed and not subordinated) to receive WGI Creditor Trust recoveries, if any, 
after repayment to Reorganized WGI of the $20 million funding advance, with     
interest at the rate of 20% per annum, compounded quarterly. As discussed above 
and in SECTION V.I.1, the Debtors assert substantial claims against Raytheon and
contest the validity and enforceability of all claims asserted by Raytheon      
against the Debtors. Any WGI Creditor Trust assets remaining after payment of   
all trust expenses, repayment of the $20 million funding advance (with interest)
and payment in full of all General Unsecured Claims (with interest from the     
Petition Date to the date of payment), if any (the "WGI Creditor Trust Equity   
Residual"), will be distributed pro rata to holders of Old Common Stock and     
other Allowed Claims (if any) in Class 8.                                       

                The Plan is premised on the substantive consolidation of the
Debtors only with respect to the treatment of Class 6 and 7 Claims for voting,  
confirmation and distribution purposes. SEE SECTION VI.B. Certain parties have  
stated that they may oppose, and Mitsubishi has stated that it will oppose, the 
substantive consolidation proposed under the Plan on the grounds that they      
believe that certain creditors may be adversely affected by such substantive    
consolidation including creditors that hold a claim against a single Debtor or, 
that substantive consolidation is improper under the circumstances. These       
situations may be fact specific. The Debtors do not believe that the substantive
consolidation proposed in the Plan will negatively impact creditor recoveries.  
The Bankruptcy Court will hear any objections to the substantive consolidation  
proposed in the Plan at the Confirmation Hearing. Therefore, any creditor who   
opposes the substantive consolidation proposed under the Plan must file an      
objection to the Plan or enter into an agreement with the Debtors reserving     
their rights prior to the Confirmation Hearing. See SECTION II.E for            
instructions as to how to file an objection to the Plan.                        

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I.       NEGOTIATIONS AND AGREEMENT WITH MR. DENNIS WASHINGTON                  

                 As set forth above and in SECTION III.B.1 , approximately 39%
of the Old Common Stock is held by Mr. Dennis Washington. Mr. Washington is     
Chairman of WGI's board of directors and as of the Petition Date was WGI's Chief
Executive Officer. Under the Plan, the Old Common Stock will be cancelled, and  
no distributions will be made to the holders thereof, other than, potentially,  
the WGI Creditor Trust Equity Residual.                                         

                  The Steering Committee for the Prepetition Secured Lenders and
the Debtors believe that Mr. Washington's continued involvement in managing the 
Company's businesses will be highly beneficial to these estates and the         
Company's future prospects. Mr. Washington has a long history of involvement in 
construction and other industries, and has been Chairman of WGI since September,
1996. Mr. Washington's reputation and contacts in the industry have been        
instrumental in the Company being awarded numerous significant contacts.        

               Accordingly, after the Chapter 11 Cases were commenced, the
Steering Committee for the Prepetition Secured Lenders and Mr. Washington began 
negotiations regarding Mr. Washington's involvement with the Company during the 
Chapter 11 Cases and after the Effective Date. At the outset, Mr. Washington    
indicated that he was not interested in continuing to be involved with the      
Company unless he could acquire an economic stake in the reorganized Company.   

             As a result of these negotiations, Mr. Washington and the
Steering Committee for the Prepetition Secured Lenders reached agreement on     
terms and conditions for Mr. Washington to render ongoing services to the       
Company, and the consideration to be provided to Mr. Washington in exchange for 
his agreement to remain with the Company (the "Washington Agreement"). The      
Debtors support that agreement, which is embodied in the Plan.                  

               The principal terms of the Washington Agreement provide for
Mr. Washington to continue as Chairman of WGI and to remain as Chairman of      
Reorganized WGI's Board of Directors for at least two years after the Effective 
Date, without compensation. Mr. Washington will be granted, on the Effective    
Date, options to acquire New Common Shares in amounts aggregating 15% of the    
total outstanding New Common Shares (on a fully diluted basis) (the "Washington 
Stock Options"). The Washington Stock Options are divided into three tranches,  
with each tranche comprised of options to purchase 5% of the New Common Shares  
outstanding, at different strike prices. One third of each tranche of the       
Washington Stock Options vest on the Effective Date, and one-third vest of each 
tranche vests on each of the first two anniversaries of the Effective Date. A   
full description of the terms and conditions of the Washington Stock Options, as
well as other components of the Washington Agreement, is set forth in SECTION   
V.G of the Plan. Lazard has calculated the value of the Washington Stock        
Options, based upon a Black-Scholes analysis, to be between $35 million and $40 
million. Certain creditors have reserved their right to dispute this valuation. 

                Importantly, and as described in SECTION V.G, the Washington
Agreement includes provision for a cash payment to Mr. Washington if the Debtors
sell substantially all of their assets prior to consummation of the Plan, and   
for the Washington Stock Options to vest immediately if the Company enters into 
an agreement before consummation of the Plan to sell certain material assets.   
SEE SECTION V.G.                                                                

        Finally, as discussed in SECTION V.G, as part of the
Washington Agreement, Mr. Washington agreed to participate in the DIP Facility  
by providing a commitment for $10 million on the same terms as the other DIP    
Lenders except that Mr. Washington will not participate in lender calls and is  
not entitled to vote on matters requiring 100% lender approval.                 

J.       SUMMARY OF TREATMENT OF CLAIMS AND INTERESTS UNDER THE PLAN            

                 As contemplated by the Bankruptcy Code, Administrative Claims
and Priority Tax Claims are not classified under the Plan. Under the Plan,      
Allowed Administrative Claims are to be paid in full on the Effective Date, or, 
for ordinary course Administrative Claims, when such claims become due. See     
SECTION VI.C.1 for a summary of the treatment proposed under the Plan for       
Administrative Claims and Priority Tax Claims.                                  

              The estimated amount of non-ordinary course Administrative
Claims to be incurred during the Chapter 11 Cases (which are primarily comprised
of professional fees and which will be paid, in part, during the Chapter 11     
Cases pursuant to Bankruptcy Court orders), is approximately $20 million, and   
the estimated amount of Priority Tax Claims is $18 to $20 million.              

                  The table below summarizes the classification and treatment of
the prepetition Claims and Interests under the Plan. For certain classes of     
Claims, estimated percentage recoveries are also set forth. Estimated percentage
recoveries have been estimated based upon a review by the Debtors' management of
the books and records, as well as a number of assumptions, including the value  

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of the New Securities to be issued under the Plan.                              

                 Based, in part, on information provided to it by the Company,
Lazard Freres & Co. LLC ("Lazard"), the investment banker for the Company, has  
evaluated the enterprise value of the Company (exclusive of claims against      
Raytheon and its subsidiaries). Lazard's valuation establishes that the value of
the Company on a going concern basis is between $470 and $640 million, with a   
midpoint of $555 million. As discussed above, this midpoint value is less than  
the amount of funded debt owed to the Prepetition Secured Lenders. Because the  
amount of funded debt of the Company projected on its pro forma consolidated    
balance sheet upon emergence from Chapter 11 is $50 million, Lazard has valued  
the New Common Shares to be issued under the Plan, in the aggregate, at         
approximately $505 million, subject to downward adjustment as a result of the   
Washington Stock Options. The valuation is based upon numerous assumptions,     
including, among other things, an assumption that the operating results         
projected for Reorganized WGI will be achieved in all material respects,        
including revenue growth and improvements in operating margins, earnings and    
cash flow. The valuation assumptions also consider, among other matters, (i)    
market valuation information concerning certain publicly traded equity          
securities of certain other companies that are considered relevant, (ii) certain
general economic and industry information considered relevant to the business of
Reorganized WGI and (iii) such other investigations and analyses deemed         
necessary or appropriate. The Debtors and Lazard believe these valuation        
assumptions are reasonable. THE VALUATION ASSUMPTIONS ARE NOT A PREDICTION OR   
REFLECTION OF POST-CONFIRMATION TRADING PRICES OF THE NEW COMMON SHARES OR ANY  
OTHER SECURITIES. SUCH SECURITIES MAY TRADE AT SUBSTANTIALLY HIGHER OR LOWER    
PRICES BECAUSE OF A NUMBER OF FACTORS, INCLUDING THOSE DISCUSSED IN SECTION     
VIII. THE TRADING PRICES OF SECURITIES ISSUED UNDER A PLAN OF REORGANIZATION ARE
SUBJECT TO MANY UNFORESEEABLE CIRCUMSTANCES AND THEREFORE CANNOT BE PREDICTED.  

             Solely for purposes of estimating potential recoveries to
holders of Claims in Class 7, it has been assumed that there will be no recovery
from Raytheon or its subsidiaries pursuant to the Raytheon Claims, and thus that
there will be no proceeds paid to creditors from the WGI Creditor Trust. This   
assumption has been made because of the inherently uncertain nature of          
estimating recoveries from ongoing litigation. The Debtors believe that the     
Raytheon Claims are valid and that such litigation will be successful, although 
there can be no assurance of any result in such litigation and it is possible   
that there will not be any recoveries obtained from Raytheon or its             
subsidiaries. Raytheon disputes that the Raytheon Claims have value. Also, for  
certain Classes of Claims, the actual amounts of Allowed Claims could materially
exceed or could be materially less than the estimated amounts shown in the table
that follows. The Debtors do not anticipate having reviewed and full analyzed   
all proofs of claim filed in these cases by the Confirmation Date. Estimated    
Claim amounts for each Class set forth below are based upon the Debtors' review 
of their books and records, and includes estimates of a number of Claims that   
are contingent, disputed and/or unliquidated. SEE SECTION VI.D.2. Accordingly,  
for these reasons, no representation can be or is being made with respect to    
whether the estimated percentage recoveries shown in the table below will       
actually be realized by the holders of Allowed Claims in any particular Class.  

                                                                [Download Table]

CLASS DESCRIPTION                       TREATMENT UNDER PLAN                    
-----------------                       --------------------                    

                                                                                
CLASS 1 -   OTHER PRIORITY CLAIMS       Class 1 consists of all Claims entitled 
                                        to priority pursuant to section 507(a)  
Estimated Allowed Claims:               of the Bankruptcy Code other than DIP   
Less than $5 million.                   Facility Claims, Priority Tax Claims or 
                                        Administrative Claims.                  

                                        Under the Plan, on or as soon as        
                                        reasonably practicable after, the latest
                                        of (i) the Distribution Date, (ii) the  
                                        date such Class 1 Claim becomes an      
                                        Allowed Class 1 Claim, or (iii) the date
                                        such Class 1 Claim becomes payable      
                                        pursuant to any agreement between a     
                                        Debtor and the holder of such Class 1   
                                        Claim, each holder of an Allowed Class 1
                                        Claim will receive in full satisfac     
                                        tion, settlement, release and discharge 
                                        of and in exchange for such Allowed     
                                        Class 1 Claim (a) Cash equal to the     
                                        unpaid portion of such Allowed Class 1  
                                        Claim or (b) such other treatment as to 
                                        which a Debtor and such holder shall    
                                        have agreed upon in writing. CLASS 1    
                                        CLAIMS ARE UNIMPAIRED AND THEREFORE NOT 
                                        ENTITLED TO VOTE ON THE PLAN. ESTIMATED 
                                        PERCENTAGE RECOVERY: 100%.              

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CLASS DESCRIPTION                       TREATMENT UNDER PLAN                    
-----------------                       --------------------                    

                                                                                
CLASS 2 -   OTHER SECURED CLAIMS        Class 2 consists of separate subclasses 
                                        of claims that are secured by a lien    
                                        upon property in which the Estate has an
Estimated Allowed Claims:               interest, to the extent of the value of 
Less than $5 million.                   the Claim holders' interest in the      
                                        Estate's interest in such property, as  
                                        determined pursuant to section 506(a) of
                                        the Bankruptcy Code against the Debtors,
                                        other than the Secured Lender Claims    
                                        included in Class 6 below ("Other       
                                        Secured Claims").                       

                                        Each subclass is deemed to be a separate
                                        class for all purposes under the        
                                        Bankruptcy Code.                        

                                        On the Effective Date, the legal,       
                                        equitable and contractual rights of     
                                        holders of an Allowed Class 2 Claim     
                                        shall be Reinstated, subject to the     
                                        provisions of ARTICLE VII of the Plan.  
                                        The Debtors' failure to object to any   
                                        such Class 2 Claims in the Chapter 11   
                                        Cases shall be without prejudice to the 
                                        rights of WGI or the Reorganized Debtors
                                        to contest or otherwise defend against  
                                        such Claim in the appropriate forum when
                                        and if such Claim is sought to be       
                                        enforced by the Other Secured Claim     
                                        holder. Notwithstanding section 1141(c) 
                                        or any other provision of the Bankruptcy
                                        Code, all prepetition liens on property 
                                        of any Debtor held by or on behalf of   
                                        the Other Secured Claim holders with    
                                        respect to such Claims shall survive the
                                        Effective Date and continue in          
                                        accordance with the contractual terms of
                                        the underlying agreements with such     
                                        Claim holders until, as to each such    
                                        Claim holder, the Allowed Claims of such
                                        Other Secured Claim holder are paid in  
                                        full, subject to the provisions of      
                                        ARTICLE VII of the Plan. CLASS 2 CLAIMS 
                                        ARE UNIMPAIRED AND THERE FORE NOT       
                                        ENTITLED TO VOTE ON THE PLAN. ESTIMATED 
                                        PERCENTAGE RECOVERY: 100%.              

CLASS 3 -   UNIMPAIRED UNSECURED        Class 3 consists of unsecured Claims of 
            CLAIMS                      any of the Debtors' employees as of the 
                                        Petition Date other than Claims arising 
Estimated Allowed Claims:               as a result of the assumption of any    
Less than $5 million.                   contract or agreement or rejection of   
                                        any contract or agreement specifically  
                                        listed on SCHEDULE 6.3 of the Plan, or  
                                        any tort claims of such employees.      

                                        Under the Plan, each holder of an       
                                        Allowed Class 3 Claim shall have its    
                                        Claim Reinstated. CLASS 3 CLAIMS ARE    
                                        UNIMPAIRED AND THEREFORE NOT ENTITLED TO
                                        VOTE ON THE PLAN. ESTIMATED PERCENTAGE  
                                        RECOVERY: 100%.                         

CLASS 4 -   INTERCOMPANY CLAIMS         Class 4 consists of, as the case may be,
                                        any Claim (a) by a Debtor against       
                                        another Debtor or (b) by a Non-Debtor   
                                        Subsid iary against a Debtor.           

                                        Under the Plan and except as provided   
                                        therein, each holder of an Allowed Class
                                        4 Claim shall have its Claim Reinstated.
                                        CLASS 4 CLAIMS ARE UNIMPAIRED AND       
                                        THEREFORE NOT ENTITLED TO VOTE ON THE   
                                        PLAN. ESTIMATED PERCENTAGE RECOVERY:    
                                        100%.                                   

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CLASS DESCRIPTION                       TREATMENT UNDER PLAN                    
-----------------                       --------------------                    

                                                                                
CLASS 5 -   SUBSIDIARY INTERESTS        Class 5 consists of the issued and      
                                        outstanding shares of stock of the      
                                        subsidiaries directly or indirectly     
                                        owned by WGI, as of the Petition Date.  
                                        Under the Plan, subject to the          
                                        Restructuring Transactions (if any), all
                                        Class 5 Interests will be Reinstated.   
                                        CLASS 5 INTERESTS ARE UNIMPAIRED AND    
                                        THEREFORE NOT ENTITLED TO VOTE ON THE   
                                        PLAN. ESTIMATED PERCENTAGE RECOVERY:    
                                        100%.                                   

CLASS 6 -   SECURED LENDER CLAIMS       Class 6 consists of all Secured Claims  
                                        of the Prepetition Secured Lenders      
Allowed Claims:                         arising under or as a result of the     
                                        Prepetition Senior Secured Credit       
Approximately $505 million, subject to  Facility, which Claims will be deemed   
downward adjustment as a result of the  Allowed pursuant to the Plan in the     
Washington Stock Options                amount of approximately $505 million,   
                                        subject to downward adjustment as a     
                                        result of the Washington Stock Options. 

                                        Under the Plan, on the Effective Date,  
                                        each holder of an Allowed Class 6 Claim,
                                        in full satisfaction, settlement,       
                                        release, and discharge of and in        
                                        exchange for such Allowed Class 6 Claim,
                                        will receive on or as soon as           
                                        practicable after the Distribution Date,
                                        its Pro Rata share of one-hundred       
                                        percent (100%) of the New Common Shares 
                                        issued and outstanding as of the        
                                        Effective Date, subject to Dilution.    
                                        CLASS 6 CLAIMS ARE IMPAIRED AND ENTITLED
                                        TO VOTE ON THE PLAN. ESTIMATED          
                                        PERCENTAGE RECOVERY: 100%.              

CLASS 7 -   GENERAL UNSECURED CLAIMS    Class 7 consists of any Claim against   
                                        the Debtors that is not a DIP Facility  
Estimated Allowed Claims:               Claim, Administrative Claim, Priority   
$650 million to $1.1 billion            Tax Claim, Other Priority Claim, Other  
(excluding any Claims                   Secured Claim, Intercompany Claim,      
asserted by Raytheon or its             Secured Lender Claim or Unimpaired      
subsidiaries, all of which are          Unsecured Claim, and includes, without  
disputed by the Debtors)                limitation, the Lender Deficiency       
                                        Claims, the Old Note Claims and the     
                                        Raytheon Asserted Claims (if any).      

                                        Under the Plan, each holder of an       
                                        Allowed Class 7 Claim shall receive in  
                                        full satisfaction, settlement, release  
                                        and discharge of and in exchange for    
                                        such Allowed Class 7 Claim, a beneficial
                                        pro rata interest in the WGI Creditor   
                                        Trust, and shall be entitled to receive 
                                        pro rata distributions from the WGI     
                                        Creditor Trust pursuant to the terms and
                                        conditions set forth in SECTION 9.7 of  
                                        the Plan and the WGI Creditor Trust     
                                        Agreement until such Claim is paid in   
                                        full plus interest accruing from the    
                                        Petition Date until the date payment is 
                                        made, at a rate of 20% per annum,       
                                        compounded quarterly. CLASS 7 CLAIMS ARE
                                        IMPAIRED AND ENTITLED TO VOTE ON THE    
                                        PLAN. ESTIMATED PERCENTAGE RECOVERY: 0% 

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CLASS DESCRIPTION                       TREATMENT UNDER PLAN                    
-----------------                       --------------------                    

                                                                                
CLASS DESCRIPTION                       Treatment Under Plan Class 8 consists of
CLASS 8 - WGI INTERESTS AND             all WGI Interests and all Subordinated  
SUBORDINATED CLAIMS                     Claims. Under the Plan, the holders of  
                                        such Claims or Interests shall not      
                                        receive or retain any property on       
                                        account of such Claim or Interests,     
                                        except for a distribution of the WGI    
                                        Creditor Trust Equity Residual, if any. 
                                        On the Effective Date, all of the WGI   
                                        Interests shall be deemed cancelled and 
                                        extinguished. CLASS 8 INTERESTS AND     
                                        SUBORDINATED CLAIMS ARE IMPAIRED AND    
                                        WILL RECEIVE NO DISTRIBUTION UNDER THE  
                                        PLAN (EXCEPT FOR A DISTRIBUTION OF THE  
                                        WGI CREDITOR TRUST EQUITY RESIDUAL, IF  
                                        ANY) AND ARE THEREFORE DEEMED TO REJECT 
                                        THE PLAN AND ARE NOT ENTITLED TO VOTE ON
                                        THE PLAN. ESTIMATED PERCENTAGE RECOVERY:
                                        0%.                                     

    As of the date hereof, the Plan is not supported by the Creditors'
Committee. Negotiations among the Debtors, the Prepetition Secured Lenders and  
the Creditors' Committee are ongoing. If a settlement among those parties is    
reached, it is possible that the Plan will be modified, pursuant to section 1127
of the Bankruptcy Code and Bankruptcy Rule 3019, to incorporate such a          
settlement. In that case, the Debtors intend seek a determination by the        
Bankruptcy Court that the solicitation of votes on the Plan pursuant to this    
Disclosure Statement applies to the Plan as so modified, and that a             
resolicitation of votes from holders of Claims in Class 7 is not required, as   
authorized by Bankruptcy Rule 3019.                                             

         THE DEBTORS BELIEVE THAT THE PLAN PROVIDES THE BEST RECOVERIES POSSIBLE
FOR HOLDERS OF CLAIMS AGAINST THE DEBTORS AND THUS STRONGLY RECOMMEND THAT YOU  
VOTE TO ACCEPT THE PLAN.                                                        

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 TABLE OF CONTENTS

                                                        [Enlarge/Download Table]

                                                                                                                               PAGE 
                                                                                                                               ---- 

                                                                                                                                    
TABLE OF APPENDICES..........................................................................................................-XVIII-

I.  INTRODUCTION...................................................................................................................1

II.    PLAN VOTING INSTRUCTIONS AND PROCEDURES.....................................................................................1
         A.       DEFINITIONS......................................................................................................1
         B.       NOTICE TO HOLDERS OF CLAIMS AND INTERESTS........................................................................1
         C.       SOLICITATION PACKAGE.............................................................................................2
         D.       VOTING PROCEDURES, BALLOTS AND VOTING DEADLINE...................................................................2
         E.       CONFIRMATION HEARING AND DEADLINE FOR OBJECTIONS TO CONFIRMATION.................................................3

III.  HISTORY AND STRUCTURE OF THE DEBTORS.........................................................................................3
         A.       OVERVIEW OF BUSINESS OPERATIONS..................................................................................3
                           1.       DESCRIPTION OF THE COMPANY'S BUSINESSES........................................................3
                           2.       BRIEF HISTORY..................................................................................3
                           3.       PREPETITION FINANCIAL RESULTS..................................................................4
         B.       CAPITAL STRUCTURE OF THE COMPANY.................................................................................8
                           1.       EQUITY.........................................................................................8
                           2.       THE PREPETITION SENIOR SECURED CREDIT FACILITY.................................................8
                           3.       UNSECURED DEBENTURES...........................................................................9
         C.       CORPORATE STRUCTURE OF THE COMPANY...............................................................................9
                           1.       CURRENT CORPORATE STRUCTURE....................................................................9
                           2.       BOARD OF DIRECTORS............................................................................10
                           3.       SENIOR OFFICERS...............................................................................11

IV.  EVENTS LEADING TO COMMENCEMENT OF THE CHAPTER 11 CASES.......................................................................12
         A.       THE RAYTHEON TRANSACTION........................................................................................12
         B.       LIQUIDITY ISSUES................................................................................................13
         C.       NEGOTIATIONS WITH PREPETITION SECURED LENDERS...................................................................13

V.  CHAPTER 11 CASES..............................................................................................................13
         A.       CONTINUATION OF BUSINESS; STAY OF LITIGATION....................................................................13
         B.       FIRST DAY ORDERS ...............................................................................................14
         C.       DEBTOR IN POSSESSION FINANCING .................................................................................15
                           1.       THE DIP FACILITY..............................................................................15
                           2.       AUTHORIZATION TO USE CASH COLLATERAL..........................................................15
                           3.       EXIT FINANCING................................................................................16
         D.       APPOINTMENT OF CREDITORS' COMMITTEE.............................................................................16
                           1.       EMPLOYEE RETENTION PROGRAM AND CONTINUANCE OF PTO PROGRAM.....................................16
                           2.       INTERIM ARRANGEMENTS REGARDING RED OAK AND ILIJAN PROJECTS....................................17
                           3.       EXTENSION OF TIME TO ASSUME OR REJECT UNEXPIRED LEASES........................................18
                           4.       POSTPETITION BONDING FACILITY.................................................................18
         F.       APPOINTMENT OF AN EXAMINER......................................................................................18
         G.       NEGOTIATIONS AND AGREEMENT WITH MR. WASHINGTON..................................................................19
                           1.       GRANT OF WASHINGTON STOCK OPTIONS.............................................................19
                           2.       EARLY VESTING OF WASHINGTON STOCK OPTIONS.....................................................20
                           3.       PAYMENT UPON SALE OF ASSETS...................................................................20
                           5.       BOARD, MANAGEMENT AND RELATED MATTERS.........................................................20
                           6.       PARTICIPATION IN THE DIP FACILITY.............................................................20
                           7.       PERMITTED ACCUMULATION OF ADDITIONAL EQUITY...................................................20

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H.       SUMMARY OF CLAIMS PROCESS AND BAR DATE ..................................................................................21
                           1.       SCHEDULES AND STATEMENTS OF FINANCIAL AFFAIRS.................................................21
                           2.       CLAIMS BAR DATE AND PROOFS OF CLAIM...........................................................21
         I.       SUMMARY OF MATERIAL LITIGATION MATTERS..........................................................................21
                           1.       CLAIMS AGAINST RAYTHEON.......................................................................22
                           2.       MITSUBISHI LITIGATION.........................................................................23
         J.       FOREIGN ACTIONS.................................................................................................23
         K.       MOTION OF THE CREDITORS' COMMITTEE TO TERMINATE THE DEBTORS' EXCLUSIVE PERIOD TO                                  
                  FILE AND SOLICIT ACCEPTANCES OF THE PLAN........................................................................23
         L.       DEVELOPMENT AND SUMMARY OF THE BUSINESS PLAN....................................................................24
                           1.       SUMMARY OF THE BUSINESS PLAN..................................................................24
                           2.       FINANCIAL HIGHLIGHTS..........................................................................30
                           3.       PRINCIPAL ASSUMPTIONS UNDERLYING THE PROJECTIONS..............................................31

VI.  SUMMARY OF THE PLAN OF REORGANIZATION........................................................................................33
         A.       OVERALL STRUCTURE OF THE PLAN...................................................................................33
         B.       SUBSTANTIVE CONSOLIDATION FOR PURPOSES OF TREATING IMPAIRED CLAIMS..............................................34
         C.       CLASSIFICATION AND TREATMENT OF CLAIMS AND INTERESTS............................................................35
                           1.       TREATMENT OF UNCLASSIFIED CLAIMS UNDER THE PLAN...............................................36
                                            a.       DIP FACILITY CLAIMS..........................................................36
                                            b.       ADMINISTRATIVE CLAIMS........................................................36
                                            c.       PRIORITY TAX CLAIMS..........................................................36
                           2.       TREATMENT OF CLASSIFIED CLAIMS AND INTERESTS UNDER THE PLAN...................................37
                                            a.       UNIMPAIRED CLASSES OF CLAIMS.................................................37
                                            b.       IMPAIRED CLAIMS AND INTERESTS................................................38
                           3.       RESERVATION OF RIGHTS REGARDING CLAIMS........................................................38
                           4.       RAYTHEON ASSERTED CLAIMS......................................................................38
         D.       DISTRIBUTIONS UNDER THE PLAN....................................................................................39
                           1.       DISTRIBUTIONS FOR CLAIMS ALLOWED AS OF THE EFFECTIVE DATE.....................................39
                                            a.       DISTRIBUTION DATE............................................................39
                                            b.       RECORD DATE FOR DISTRIBUTIONS TO HOLDERS OF                                    
                                                     SECURED LENDER CLAIMS AND OLD NOTES..........................................39
                                            c.       CALCULATION OF DISTRIBUTION AMOUNTS OF NEW COMMON SHARES.....................39
                                            d.       DELIVERY OF DISTRIBUTIONS....................................................40
                                            e.       OLD NOTES....................................................................40
                                            f.       LOST, MUTILATED OR DESTROYED OLD NOTES.......................................40
                                            g.       FAILURE TO SURRENDER CANCELED OLD NOTES......................................40
                           2.       RESOLUTION AND TREATMENT OF DISPUTED, CONTINGENT, AND UNLIQUIDATED CLAIMS AND DISPUTED          
                                    INTERESTS.....................................................................................40
                                            a.       PROSECUTION OF OBJECTIONS....................................................40
                                            b.       NO DISTRIBUTIONS PENDING ALLOWANCE...........................................41
                                            c.       DISPUTED DISTRIBUTION RESERVE; RESERVE FOR SUBSEQUENT                          
                                                     DISTRIBUTIONS TO QUALIFYING CLASS 7 CREDITORS................................41
                                            d.       DISTRIBUTIONS AFTER ALLOWANCE OF CLASS 7 CLAIMS..............................41
         E.       POST-CONSUMMATION OPERATIONS OF THE DEBTORS.....................................................................41
                           1.       CONTINUED CORPORATE EXISTENCE.................................................................41
                           2.       CANCELLATION OF OLD SECURITIES AND AGREEMENTS.................................................41
                           3.       CERTIFICATES OF INCORPORATION AND BYLAWS......................................................41
                           4.       RESTRUCTURING TRANSACTIONS....................................................................41
         F.       SUMMARY OF SECURITIES TO BE ISSUED IN CONNECTION WITH THE PLAN..................................................42
                           1.       NEW COMMON SHARES.............................................................................42
                           2.       REGISTRATION RIGHTS AGREEMENT.................................................................42

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         G.       EXIT FACILITY...................................................................................................42
         H.       SUMMARY OF RELEASES UNDER THE PLAN..............................................................................43
                           1.       RELEASES BY DEBTORS...........................................................................43
                           2.       RELEASES BY HOLDERS OF LENDER CLAIMS..........................................................43
                           3.       INJUNCTION RELATED TO RELEASES................................................................44
         I.       COMPENSATION AND BENEFIT PROGRAMS...............................................................................44
         J.       DIRECTORS AND OFFICERS OF REORGANIZED DEBTORS...................................................................44
                           1.       APPOINTMENT...................................................................................44
                           2.       TERMS.........................................................................................44
                           3.       VACANCIES.....................................................................................44
                           4.       TREATMENT OF DIRECTOR AND OFFICER INDEMNIFICATION OBLIGATIONS UNDER THE PLAN..................45
         K.       REVESTING OF ASSETS.............................................................................................45
         L.       PRESERVATION OF RIGHTS OF ACTION................................................................................45
         M.       OTHER MATTERS...................................................................................................45
                           1.       TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES.........................................45
                                            a.       ASSUMED CONTRACTS AND LEASES.................................................46
                                            b.       PAYMENTS RELATED TO ASSUMPTION OF CONTRACTS AND LEASES.......................46
                                            c.       REJECTED CONTRACTS AND LEASES................................................46
                                            d.       REJECTION DAMAGES BAR DATE...................................................46
                           2.       SPECIAL PROVISIONS FOR WARRANTY AND INDEMNITY OBLIGATIONS                                       
                                    ARISING OUT OF COMPLETED PROJECTS.............................................................47
                           3.       ADMINISTRATIVE CLAIMS.........................................................................47
                           4.       PROFESSIONAL FEE CLAIMS.......................................................................47
                           5.       WITHHOLDING AND REPORTING REQUIREMENTS........................................................47
                           6.       SETOFFS.......................................................................................47
                           7.       CONTINUATION OF CERTAIN ORDERS................................................................48
         N.       CONFIRMATION AND/OR CONSUMMATION................................................................................48
                           1.       REQUIREMENTS FOR CONFIRMATION OF THE PLAN.....................................................48
                           2.       CONDITIONS TO CONFIRMATION AND CONSUMMATION...................................................49
                                            a.       CONDITIONS TO CONFIRMATION...................................................49
                                            b.       CONDITIONS TO EFFECTIVE DATE.................................................49
                                            c.       WAIVER OF CONDITIONS.........................................................49
         O.       EFFECTS OF CONFIRMATION.........................................................................................50
                           1.       BINDING EFFECT................................................................................50
                           2.       DISCHARGE OF THE DEBTORS......................................................................50
                           3.       PERMANENT INJUNCTION..........................................................................50
                           4.       EXCULPATION AND LIMITATION ON LIABILITY; INDEMNITY............................................51
         P.       RETENTION OF JURISDICTION.......................................................................................51
         Q.       PAYMENT OF STATUTORY FEES.......................................................................................52

VII.  WGI CREDITOR TRUST..........................................................................................................52
         A.       APPOINTMENT OF TRUSTEE..........................................................................................52
         B.       TRANSFER OF TRUST ASSETS TO THE WGI CREDITOR TRUST..............................................................52
         C.       THE WGI CREDITOR TRUST..........................................................................................53
         D.       THE TRUST ADVISORY BOARD........................................................................................53
         E.       FUNDING OF THE WGI CREDITOR TRUST...............................................................................54
         F.       REIMBURSEMENT OBLIGATION........................................................................................54
         G.       DISTRIBUTIONS OF TRUST ASSETS...................................................................................54

VIII.  CERTAIN FACTORS TO BE CONSIDERED...........................................................................................54
         A.       GENERAL CONSIDERATIONS..........................................................................................54
         B.       CERTAIN BANKRUPTCY CONSIDERATIONS...............................................................................55
                           1.       FAILURE TO CONFIRM OR CONSUMMATE THE PLAN.....................................................55
                           2.       DISRUPTION OF OPERATIONS DUE TO THE FILING OF THE CHAPTER 11 CASES............................55
         C.       INHERENT UNCERTAINTY OF FINANCIAL PROJECTIONS...................................................................55

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         D.       INTEGRATION ISSUES..............................................................................................56
         E.       LACK OF ESTABLISHED MARKET FOR THE NEW SECURITIES...............................................................56
         F.       RESTRICTED RESALE OF THE NEW SECURITIES.........................................................................56
         G.       ENVIRONMENTAL MATTERS...........................................................................................57
         H.       UNIMPAIRED AND UNKNOWN CLAIMS...................................................................................57
         I.       INDUSTRY CYCLICALITY............................................................................................57
         J.       BUSINESS AND COMPETITION........................................................................................57
         K.       GOVERNMENT CONTRACTS............................................................................................58
         L.       FIXED PRICE CONTRACTS AND OTHER PROJECT RISKS...................................................................58
         M.       INTERNATIONAL OPERATIONS........................................................................................58
         N.       BONDING.........................................................................................................59
         O.       RELIANCE ON KEY PERSONNEL.......................................................................................59
         P.       CERTAIN LITIGATION .............................................................................................59

IX.  APPLICABILITY OF FEDERAL AND OTHER SECURITIES LAWS...........................................................................60
         A.       OFFER AND SALE OF NEW SECURITIES, PURSUANT TO THE PLAN:  BANKRUPTCY CODE                                          
                  EXEMPTION FROM REGISTRATION REQUIREMENTS........................................................................60
         B.       SUBSEQUENT TRANSFERS OF NEW SECURITIES..........................................................................60
                           1.       FEDERAL SECURITIES LAWS: SECTION 1145(C) OF THE BANKRUPTCY CODE...............................60
                           2.       SUBSEQUENT TRANSFERS OF NEW COMMON SHARES UNDER STATE SECURITIES LAWS.........................61

X.  INCOME TAX CONSEQUENCES OF THE PLAN...........................................................................................61
         A.       FEDERAL INCOME TAX CONSEQUENCES TO THE DEBTORS..................................................................61
                           1.       CANCELLATION OF INDEBTEDNESS INCOME...........................................................61
                           2.       NET OPERATING LOSSES AND OTHER ATTRIBUTES.....................................................62
                           3.       FEDERAL ALTERNATIVE MINIMUM TAX...............................................................63
         B.       FEDERAL INCOME TAX CONSEQUENCES TO CLAIM HOLDERS................................................................63
                           1.       UNITED STATES FEDERAL INCOME TAX CONSEQUENCES.................................................63
                                            a.       GENERAL......................................................................63
                                            b.       MARKET DISCOUNT..............................................................63
                                            c.       REORGANIZATION TREATMENT.....................................................63
                           2.       NON-UNITED STATES PERSONS.....................................................................64
                           3.       INFORMATION REPORTING AND BACKUP WITHHOLDING..................................................64
         C.       UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE WGI CREDITOR TRUST.........................................65
         D.       IMPORTANCE OF OBTAINING PROFESSIONAL TAX ASSISTANCE.............................................................65

XI.  FEASIBILITY OF THE PLAN AND BEST INTERESTS OF CREDITORS......................................................................65
         A.       FEASIBILITY OF THE PLAN.........................................................................................65
         B.       ACCEPTANCE OF THE PLAN..........................................................................................66
         C.       BEST INTERESTS TEST.............................................................................................66
         D.       LIQUIDATION ANALYSIS............................................................................................67
         E.       VALUATION OF THE REORGANIZED DEBTORS............................................................................67
                           1.       REORGANIZED COMPANY...........................................................................68
                           2.       SUMMARY OF FINANCIAL ANALYSIS.................................................................69
         F.       APPLICATION OF THE "BEST INTERESTS" OF CREDITORS TEST TO THE LIQUIDATION ANALYSIS AND THE VALUATION.............70
         G.       CONFIRMATION WITHOUT ACCEPTANCE OF ALL IMPAIRED CLASSES: THE "CRAMDOWN" ALTERNATIVE.............................70

XII.  ALTERNATIVES TO CONFIRMATION AND CONSUMMATION OF THE PLAN...................................................................71
         A.       ALTERNATIVE PLAN(S) OF REORGANIZATION...........................................................................71
         B.       LIQUIDATION UNDER CHAPTER 7 OR CHAPTER 11.......................................................................71

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XIII.  THE SOLICITATION; VOTING PROCEDURE.........................................................................................72
         A.       PARTIES IN INTEREST ENTITLED TO VOTE............................................................................72
         B.       CLASSES IMPAIRED UNDER THE PLAN.................................................................................72
         C.       WAIVERS OF DEFECTS, IRREGULARITIES, ETC.........................................................................72
         D.       WITHDRAWAL OF BALLOTS; REVOCATION...............................................................................72
         E.       FURTHER INFORMATION; ADDITIONAL COPIES..........................................................................73
         F.       INTERNET ACCESS TO BANKRUPTCY COURT DOCUMENTS...................................................................73

XIV.  RECOMMENDATION AND CONCLUSION...............................................................................................74


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 TABLE OF APPENDICES

APPENDIX                           NAME                       
--------                           ----                       

     Appendix A           Second Amended Joint Plan of Reorganization of
                        Washington Group International, Inc., et al.

Appendix B           Liquidation Analysis                     

Appendix C           Pro Forma Financial Projections          

        Appendix D           Raytheon's Statement Concerning Its Disputes with
                      Washington Group International, (Delaware)

         Appendix E           Current Schedule of Critical Vendor Claims Paid or
                  To Be Paid During the Chapter 11 Cases

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 I. INTRODUCTION

               Washington Group International, Inc. ("WGI") and certain of
its direct and indirect subsidiaries that are also debtors and                  
debtors-in-possession (the "Subsidiary Debtors") in the above-referenced Chapter
11 cases (collectively, the "Debtors") submit this disclosure statement (the    
"Disclosure Statement") pursuant to section 1125 of the Bankruptcy Code, for use
in the solicitation of votes on the Second Amended Joint Plan of Reorganization 
of Washington Group International, Inc. et al. dated as of July 24, 2001 (the   
"Plan"), proposed by the Debtors and filed with the United States Bankruptcy    
Court for the District of Nevada (the "Bankruptcy Court"). A copy of the Plan is
annexed as APPENDIX A to this Disclosure Statement.                             

            This Disclosure Statement sets forth certain information
regarding the Debtors' prepetition operating and financial history, the need to 
seek Chapter 11 protection, significant events that are expected to occur during
the Chapter 11 Cases, and the anticipated organization, operations and financing
of the Debtors upon successful emergence from Chapter 11 (the "Reorganized      
Debtors"). This Disclosure Statement also describes terms and provisions of the 
Plan, including certain alternatives to the Plan, certain effects of            
confirmation of the Plan, certain risk factors associated with securities to be 
issued under the Plan, and the manner in which distributions will be made under 
the Plan. In addition, this Disclosure Statement discusses the confirmation     
process and the voting procedures that holders of Claims entitled to vote under 
the Plan must follow for their votes to be counted.                             

              Except as otherwise provided herein, capitalized terms not
otherwise defined in this Disclosure Statement have the meanings ascribed to    
them in the Plan. Unless otherwise noted herein, all dollar amounts provided in 
this Disclosure Statement and in the Plan are given in United States dollars.   

             FOR A DESCRIPTION OF THE PLAN AND VARIOUS RISKS AND OTHER
FACTORS PERTAINING TO THE PLAN AS IT RELATES TO HOLDERS OF CLASS 6 AND 7 CLAIMS,
PLEASE SEE SECTION VI OF THE DISCLOSURE STATEMENT, ENTITLED "SUMMARY OF THE PLAN
OF REORGANIZATION," AND SECTION VIII OF THE DISCLO SURE STATEMENT, ENTITLED     
"CERTAIN FACTORS TO BE CONSIDERED."                                             

           THIS DISCLOSURE STATEMENT CONTAINS SUMMARIES OF CERTAIN
PROVISIONS OF THE PLAN, CERTAIN STATUTORY PROVISIONS, CERTAIN DOCUMENTS RELATING
TO THE PLAN, CERTAIN EVENTS EXPECTED TO OCCUR IN THE CHAPTER 11 CASES AND       
CERTAIN FINANCIAL INFORMATION. ALTHOUGH THE DEBTORS BELIEVE THAT THE SUMMARIES  
OF THE PLAN AND RELATED DOCUMENT SUMMARIES ARE FAIR AND ACCURATE, SUCH SUMMARIES
ARE QUALIFIED TO THE EXTENT THAT THEY DO NOT SET FORTH THE ENTIRE TEXT OF SUCH  
DOCUMENTS OR STATUTORY PROVISIONS. FACTUAL INFORMATION CONTAINED IN THIS        
DISCLOSURE STATEMENT HAS BEEN PROVIDED BY THE DEBTORS' MANAGEMENT, EXCEPT WHERE 
OTHERWISE SPECIFICALLY NOTED. THE DEBTORS DO NOT WARRANT OR REPRESENT THAT THE  
INFORMATION CONTAINED HEREIN, INCLUDING THE FINANCIAL INFORMATION, IS WITHOUT   
ANY MATERIAL INACCURACY OR OMISSION.                                            

                THE DEBTORS BELIEVE THAT THE PLAN WILL ENABLE THE DEBTORS TO
SUCCESSFULLY REORGANIZE AND ACCOMPLISH THE OBJECTIVES OF CHAPTER 11 AND THAT    
ACCEPTANCE OF THE PLAN IS IN THE BEST INTERESTS OF THE DEBTORS AND THE HOLDERS  
OF CLASS 6 CLAIMS AND CLASS 7 CLAIMS. THE DEBTORS URGE HOLDERS OF CLASS 6 AND 7 
CLAIMS TO VOTE TO ACCEPT THE PLAN.                                              

                  FOR FURTHER INFORMATION AND INSTRUCTION ON VOTING TO ACCEPT OR
REJECT THE PLAN, SEE SECTION XIII OF THE DISCLOSURE STATEMENT, ENTITLED "THE    
SOLICITATION; VOTING PROCEDURE."                                                

 II. PLAN VOTING INSTRUCTIONS AND PROCEDURES

A.       DEFINITIONS                                                            

             Except as otherwise defined herein, capitalized terms not
otherwise defined in this Disclosure Statement have the meanings ascribed to    
them in the Plan.                                                               

B.       NOTICE TO HOLDERS OF CLAIMS AND INTERESTS                              

               This Disclosure Statement will be transmitted to holders of
Claims that are entitled under the Bankruptcy Code to vote on the Plan. See     
SECTION XIII for a discussion and listing of those holders of Claims that are   
entitled to vote on the Plan and those holders of Claims and Interests that are 
not entitled to vote on the Plan. The purpose of this Disclosure Statement is to
provide adequate information to enable such Claim holders to make a reasonably  
informed decision with respect to the Plan prior to exercising                  

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their right to vote to accept or reject the Plan.                               

                 The Bankruptcy Court has approved the Disclosure Statement as
containing information of a kind and in sufficient and adequate detail to enable
such Claim holders to make an informed judgment with respect to acceptance or   
rejection of the Plan. THE BANKRUPTCY COURT'S APPROVAL OF THIS DISCLOSURE       
STATEMENT DOES NOT CONSTITUTE EITHER A GUARANTY OF THE ACCURACY OR COMPLETENESS 
OF THE INFORMATION CONTAINED HEREIN OR AN ENDORSEMENT OF THE PLAN BY THE        
BANKRUPTCY COURT.                                                               

               ALL HOLDERS OF CLAIMS AGAINST THE DEBTORS ARE ENCOURAGED TO
READ THIS DISCLO SURE STATEMENT AND ITS APPENDICES CAREFULLY AND IN THEIR       
ENTIRETY BEFORE DECIDING TO VOTE EITHER TO ACCEPT OR TO REJECT THE PLAN. This   
Disclosure Statement contains important information about the Plan,             
considerations pertinent to acceptance or rejection of the Plan, and            
developments concerning the Chapter 11 Cases.                                   

                THIS DISCLOSURE STATEMENT IS THE ONLY DOCUMENT TO BE USED IN
CONNECTION WITH THE SOLICITATION OF VOTES ON THE PLAN. No solicitation of votes 
may be made except after distribution of this Disclosure Statement, and no      
person has been authorized to distribute any information concerning the Debtors 
other than the information contained herein.                                    

           CERTAIN OF THE INFORMATION CONTAINED IN THIS DISCLOSURE
STATEMENT IS BY ITS NATURE FORWARD LOOKING AND CONTAINS ESTIMATES, ASSUMPTIONS  
AND PROJECTIONS THAT MAY BE MATERIALLY DIFFERENT FROM ACTUAL, FUTURE RESULTS.   
Except with respect to the projections set forth in APPENDIX C annexed hereto   
(the "Projections") and except as otherwise specifically and expressly stated   
herein, this Disclosure Statement does not reflect any events that may occur    
subsequent to the date hereof and that may have a material impact on the        
information contained in this Disclosure Statement. The Debtors do not intend to
update the Projections; thus, the Projections will not reflect the impact of any
subsequent events not already accounted for in the assumptions underlying the   
Projections. Further, the Debtors do not anticipate that any amendments or      
supplements to this Disclosure Statement will be distributed to reflect such    
occurrences. Accordingly, the delivery of this Disclosure Statement shall not   
under any circumstance imply that the information herein is correct or complete 
as of any time subsequent to the date hereof.                                   

              EXCEPT WHERE SPECIFICALLY NOTED, THE FINANCIAL INFORMATION
CONTAINED HEREIN HAS NOT BEEN AUDITED BY A CERTIFIED PUBLIC ACCOUNTING FIRM AND 
HAS NOT BEEN PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING          
PRINCIPLES.                                                                     

C.       SOLICITATION PACKAGE                                                   

                Along with the mailing of this Disclosure Statement, as part
of the solicitation of acceptances of the Plan, the Debtors will send copies of 
(1) the Plan; (2) the notice of, among other things, the time for submitting    
Ballots to accept or reject the Plan, the date, time and place of the hearing to
consider confirmation of the Plan and related matters, and the time for filing  
objections to confirmation of the Plan (the "Confirmation Hearing Notice"); and 
(3) if you are the holder of Claim(s) entitled to vote on the Plan, one or more 
Ballots (and return envelopes) to be used by you in voting to accept or to      
reject the Plan.                                                                

D.       VOTING PROCEDURES, BALLOTS AND VOTING DEADLINE                         

                 After carefully reviewing the Plan, this Disclosure Statement
and the detailed instructions accompanying your Ballot, please indicate your    
acceptance or rejection of the Plan by voting in favor of or against the Plan on
the enclosed Ballot. You must complete and sign your original Ballot (copies    
will not be accepted) and return it in the envelope provided.                   

                Each Ballot has been coded to reflect the Class of Claims it
represents. Accordingly, in voting to accept or reject the Plan, you must use   
only the coded Ballot or Ballots sent to you with this Disclosure Statement.    

             IN ORDER FOR YOUR VOTE TO BE COUNTED, YOUR BALLOT MUST BE
PROPERLY COMPLETED AS SET FORTH ABOVE AND IN ACCORDANCE WITH THE VOTING         
INSTRUCTIONS ON THE BALLOT AND RECEIVED NO LATER THAN AUGUST 27, 2001, AT 4:00  
P.M. (PACIFIC TIME) (THE "VOTING DEADLINE") BY ROBERT L. BERGER & ASSOCIATES,   
LLC (THE "VOTING AGENT"). DO NOT RETURN ANY STOCK CERTIFICATES OR DEBT          
INSTRUMENTS WITH YOUR BALLOT.                                                   

                If you have any questions about (1) the procedure for voting
your Claim or Interest or with respect to the packet of                         

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materials that you have received or (2) the amount of your Claim, or if you wish
to obtain, at your own expense, unless otherwise specifically required by       
Federal Rule of Bankruptcy Procedure 3017(d), an additional copy of the Plan,   
this Disclosure Statement or any appendices or exhibits to such documents,      
please contact:                                                                 

Washington Group International, Inc.
c/o Robert L. Berger & Associates, LLC
PMB 1007
10351 Santa Monica Boulevard, Suite 101A
 Los Angeles, CA 90025
 Phone: (818) 771-7469
 Fax: (818) 905-6542

                  FOR FURTHER INFORMATION AND INSTRUCTION ON VOTING TO ACCEPT OR
REJECT THE PLAN, SEE SECTION XIII.                                              

E.       CONFIRMATION HEARING AND DEADLINE FOR OBJECTIONS TO CONFIRMATION       

               Pursuant to section 1128 of the Bankruptcy Code and Federal
Rule of Bankruptcy Procedure 3017(c), the Bankruptcy Court has scheduled a      
Confirmation Hearing for September 6, 2001, at 9:30 a.m. The Confirmation       
Hearing may be adjourned from time to time by the Bankruptcy Court without      
further notice except for the announcement of the adjournment date made at the  
Confirmation Hearing or at any subsequent adjourned Confirmation Hearing.       
Objections to Confirmation of the Plan must be filed with the Bankruptcy Court  
not later than August 24, 2001.                                                 

 III. HISTORY AND STRUCTURE OF THE DEBTORS

A.       OVERVIEW OF BUSINESS OPERATIONS                                        

1.       DESCRIPTION OF THE COMPANY'S BUSINESSES              

                The Company is an international provider of a broad range of
design, engineering, construction, construction management, facilities and      
operations management, environmental remediation and mining services to diverse 
public and private sector clients. The Company operates its businesses through  
five operating units, each of which comprises a separate reportable business    
segment: Power, Infrastructure & Mining, Industrial/Process, Government, and    
Petroleum & Chemicals. The reportable segments serve different markets and      
customers, and differ in their expertise, technology and resources necessary to 
perform their services. See SECTION V.L for a description of each business      
segment.                                                                        

             The Company's customers include Fortune 500 companies and
government entities, and projects often take years to complete and substantial  
financial commitments by project owners. Often, to be awarded a contract, the   
Company must be able to have issued for the benefit of the project owner,       
payment, performance or other types of bonds. SEE SECTION V.E.4.                

2.       BRIEF HISTORY                                        

                WGI was originally formed as a Delaware corporation on April
28, 1993 under the name Kasler Holding Company to become the parent company of  
WCG Holdings, Inc. ("WCG") and Kasler Corporation ("Kasler"), which were active 
in the infrastructure, contract mining, environmental remediation, commercial   
construction and construction materials markets. In April 1996, the name was    
changed from Kasler Holding Company to Washington Construction Group, Inc.      
("Washington Construction").                                                    

               On September 11, 1996, Washington Construction acquired the
net assets and the engineering and construction operations of Morrison Knudsen  
Corporation, a Delaware corporation ("Old MK"), in a transaction structured as a
merger of Old MK with and into Washington Construction, and changed its name to 
Morrison Knudsen Corporation. Old MK had a historic legacy of projects over the 
last 90 years, including the Hoover Dam, the San Francisco Bay Bridge, the      
Trans-Alaska Pipeline, and major features of the Kennedy Space Center. The      
acquisition of Old MK was an integral part of the reorganization of Old MK      
pursuant to a plan of reorganization (the "Old MK Plan") filed by Old MK in the 
United States Bankruptcy Court for the District of Delaware. The Old MK Plan was
confirmed by the Delaware Bankruptcy Court on August 26, 1996, and became       
effective concurrently with the merger on September 11, 1996. The Company has no
remaining obligations under the Old MK Plan.                                    

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           On March 22, 1999, the Company, in a joint venture with
British Nuclear Fuels, Ltd., acquired the operations of the government and      
environmental services businesses (the "Westinghouse Group") of CBS Corporation.
The Westinghouse Group manages highly complex facilities and programs for the   
United States Departments of Energy and Defense, and a wide range of services at
government installations. The acquisition of the Westinghouse Group was         
accounted for as a purchase business combination. WGI has a 60% economic        
ownership interest in the Westinghouse Group. THE ENTITIES THAT COMPRISE THE    
WESTINGHOUSE GROUP ARE NOT DEBTORS, HAVE NOT COMMENCED CHAPTER 11 CASES, AND    
THUS CONTINUE TO OPERATE IN THE ORDINARY COURSE OF BUSINESS UNAFFECTED BY THE   
CHAPTER 11 CASES.                                                               

                On July 7, 2000, pursuant to an agreement, dated as of April
14, 2000 (the "Stock Purchase Agreement"), among Raytheon Company ("Raytheon"), 
Raytheon Engineers & Constructors International, Inc., a wholly-owned subsidiary
of Raytheon ("RECI" and, together with Raytheon, the "Sellers"), and WGI, the   
Debtors purchased the capital stock of the subsidiaries of RECI (the "RECI      
Subsidiaries") and certain other assets of RECI and assumed certain liabilities 
of RECI (collectively the "RE&C Businesses"). Prior to such purchase, RECI      
provided engineering, design, procurement, construction, operation, maintenance 
and other services on a worldwide basis, and reported annual revenues of        
approximately $2.7 billion for the year ended December 31, 1999. The purchase   
price paid at the closing of the acquisition ("Closing") on July 7, 2000 for the
RE&C Businesses was $53 million in cash and the assumption of net liabilities   
estimated by the Sellers at the time of the transaction of approximately $450   
million. In addition, the Debtors paid the Sellers $83 million, representing the
net amount of cash advanced or paid by the Sellers for the use or benefit of the
RE&C Businesses between April 30, 2000 and Closing. Finally, the Stock Purchase 
Agreement provided that RECI would retain all non-restricted cash and cash      
equivalents held by RECI and the RECI Subsidiaries as of the close of business  
on April 30, 2000. At Closing, for purposes of administrative convenience, the  
RECI Subsidiaries retained all cash held by them, and the Debtors paid to the   
Sellers approximately $30.8 million, which amount was subject to post-Closing   
verification by the Debtors and adjustment. See SECTIONS IV.A AND V.I.1 for a   
discussion of subsequent disputes and litigation with Raytheon and APPENDIX D   
for a statement of position by Raytheon.                                        

             As a result of liquidity issues resulting from Raytheon's
failure to disclose known losses, WGI and 71 Subsidiary Debtors each filed a    
voluntary petition in the United States Bankruptcy Court for the District of    
Nevada on May 14, 2001 (the "Petition Date") for reorganization relief under    
Chapter 11 of title 11 of the United States Code, 11 U.S.C. Sections            
101-1330, as amended (the "Bankruptcy Code"). The Debtors continue to manage    
and operate their business as debtors-in-possession pursuant to sections 1107   
and 1108 of the Bankruptcy Code. IN ADDITION TO THE SUBSIDIARY DEBTORS, WGI     
HAS DIRECT OR INDIRECT INTERESTS IN MANY SUBSIDIARIES (INCLUDING FOREIGN        
ENTITIES, JOINT VENTURES AND THE WESTINGHOUSE GROUP) THAT HAVE NOT COMMENCED    
CASES UNDER THE BANKRUPTCY CODE (COLLECTIVELY, THE "NON-DEBTOR SUBSIDIARIES")   
AND ACCORDINGLY CONTINUE TO OPERATE THEIR BUSINESSES IN THE ORDINARY COURSE     
WITHOUT BEING MATERIALLY IMPACTED BY THE DEBTORS' CHAPTER 11 CASES. FOR A       
LIST OF THE NON-DEBTOR SUBSIDIARIES, SEE SCHEDULE 1.67 OF THE PLAN.             

3.       PREPETITION FINANCIAL RESULTS                        

                 Set forth below is selected financial data for WGI, including
its direct and indirect Subsidiaries, on a consolidated basis for the nine      
months ended September 1, 2000 and for the year ended December 3, 1999. The     
financial data for the nine months ended September 1, 2000 is unaudited. The    
financial data for the year ended December 3, 1999 was audited for inclusion in 
WGI's Form 10-K filed with the SEC.                                             

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 TOTAL COMPANY
 STATEMENT OF OPERATIONS
($ US THOUSANDS)

                                                        [Enlarge/Download Table]


                                                      September 1, 2000  December 3, 1999
                                                         (unaudited)                     

                                                                                         
Revenue                                                  $  2,051,344       $  2,291,967 
Cost of revenue                                            (1,945,719)        (2,180,315)
                                                         ------------       ------------ 

Gross profit                                                  105,625            124,087 
General and administrative expenses                           (24,366)           (25,999)
Goodwill amortization                                         (21,608)           (12,576)
Integration and merger costs                                  (10,056)              --   
                                                         ------------       ------------ 

Operating income                                               49,525             85,512 
Investment income                                               5,828              3,429 
Interest expense                                              (17,730)            (7,642)
Other income, net                                               1,358              9,681 
                                                         ------------       ------------ 

Income before income taxes and minority interests in                                     
income of consolidated subsidiaries                            39,051             90,980 
Income tax expense                                            (15,510)           (33,924)
Minority interests in income of consolidated                                             
         subsidiaries                                          (3,523)            (8,771)
                                                         ------------       ------------ 

Net income                                               $     20,018       $     48,285 
                                                         ============       ============ 

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TOTAL COMPANY BALANCE SHEETS
 ($ US THOUSANDS, EXCEPT PER SHARE DATA)

                                                                [Download Table]

                          ASSETS               September 1, 2000  December 3, 1999
                                                  (unaudited)                     
                      Current Assets                                              

                                                                                  
Cash and cash equivalents                            372,114             52,475   
Accounts receivable                                  346,690            245,088   
Unbilled receivables                                 434,815            154,039   
Inventories, net of progress payments                 24,030             20,096   
Refundable income taxes                                2,638              3,055   
Investments in and advances to construction                                       
         joint ventures                               71,052             61,160   
Deferred income taxes                                 42,675             41,043   
Other                                                 12,384             18,826   
                                                ------------       ------------   

Total current assets                               1,306,398            595,782   
                                                ------------       ------------   

               Investments and Other Assets                                       
Securities available for sale, at fair value          41,774             41,640   
Investments in mining ventures                        64,798             69,063   
Cost in excess of net assets acquired              1,486,092            351,869   
Deferred income taxes                                 50,539             48,606   
Other                                                109,678             21,114   
                                                ------------       ------------   

Total investments and other assets                 1,752,881            532,292   
                                                ------------       ------------   

              Property and Equipment, at Cost                                     
Construction equipment                               303,011            195,833   
Land and improvements                                  8,049              7,970   
Buildings and improvements                            36,209             17,154   
Equipment and fixtures                                99,204             82,745   
                                                ------------       ------------   

Total property and equipment                         446,793            303,702   
Less accumulated depreciation                       (175,833)          (164,630)  
                                                ------------       ------------   

Property and equipment, net                          270,640            139,072   
                                                ------------       ------------   

Total assets                                       3,329,919          1,267,146   
                                                ============       ============   

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LIABILITIES AND                     
STOCKHOLDERS' EQUITY                      

Current Liabilities                     

                                                                [Download Table]
                                                                           
Current portion of long-term debt                       4,000          --  
Accounts payable and subcontracts payable             662,332       179,686

Billings in excess of cost and estimated                                   
earnings on uncompleted contracts                     746,763        61,805

Estimated costs to complete long-term contracts       292,331        46,905
Accrued salaries, wages and benefits, including                            
     compensated absences                             100,726        79,727
Income taxes payable                                    1,288         1,079
Other accrued liabilities                              30,797        68,806
                                                 ------------  ------------

Total current liabilities                           1,838,227       438,008
                                                 ------------  ------------

                  Non-Current Liabilities                                  
Long-term debt                                        693,818       100,000
Postretirement benefit obligation                      82,538        80,685
Accrued workers' compensation                          41,411        36,181
Pension and deferred compensation liabilities          91,621       100,116
Environmental remediation obligations                   4,430         6,016
Other non-current liabilities                          75,733          --  
                                                 ------------  ------------

Total non-current liabilities                         989,551       322,998
                                                 ------------  ------------

               Contingencies and Commitments                               
Minority Interests                                     86,721       103,050
                                                 ------------  ------------

Total stockholders' equity                            415,420       403,090
                                                 ------------  ------------

Total liabilities and stockholders' equity          3,329,919     1,267,146
                                                 ============  ============

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B.       CAPITAL STRUCTURE OF THE COMPANY                                       

1.       EQUITY                                               

             Prior to September 18, 2000, WGI's stock (the "Old Common
Stock") traded on the New York Stock Exchange (the "NYSE") under the ticker     
symbol "MK". Since that date, the Debtors' stock has traded on the NYSE under   
the ticker symbol "WNG." On May 14, 2001, the NYSE suspended trading of the Old 
Common Stock and initiated delisting procedures.                                

                As of the Petition Date, there were approximately 52,349,872
shares of common stock of WGI issued and outstanding. Approximately 39% of the  
Old Common Stock is held by, or for the benefit of, Dennis Washington. Mr.      
Washington is the Chairman of the Board of Directors of WGI. SEE SECTIONS       
III.C.1 AND V.G.                                                                

                  Under the Plan, the holders of Interests on account of the Old
Common Stock will be classified in Class 8. Under the Plan, holders of Claims   
and Interests in Class 8 will not receive or retain any property under the Plan 
on account of such Claims or Interests, unless there is a distribution on       
account of a WGI Creditor Trust Equity Residual. On the business day on which   
all conditions to consummation of the Plan have been satisfied or waived, as set
forth in the Plan (the "Effective Date"), all of the Old Common Stock will be   
deemed cancelled and extinguished.                                              

2.       THE PREPETITION SENIOR SECURED CREDIT FACILITY       

                Prior to the acquisition of the RE&C Businesses, the Company
had uncollateralized revolving credit facilities providing an aggregate         
borrowing capacity of $325 million, of which $99.9 million was outstanding at   
June 2, 2000. On July 7, 2000, in order to finance the RE&C Businesses          
acquisition, refinance such existing revolving credit facilities, fund working  
capital requirements and pay related fees and expenses, WGI obtained new senior 
secured credit facilities, providing for an aggregate of $1.2 billion of term   
loans and revolving borrowing capacity (the "Prepetition Senior Secured Credit  
Facility") from certain lenders, including Credit Suisse First Boston ("CSFB"), 
as administrative agent, collateral agent and an issuing bank and as arranger   
(the "Agent"), Bank of Montreal, as syndication agent, Bank of America, N.A. and
U.S. Bank National Association, as documentation agents, and various other      
persons from time to time parties to the Prepetition Senior Secured Credit      
Facility as lenders (collectively, the "Prepetition Secured Lenders"). WGI's    
obligations under the Prepetition Senior Secured Credit Facility are guaranteed 
by certain of WGI's direct and indirect subsidiaries, all of which are Debtors. 

                The Prepetition Senior Secured Credit Facility provided for,
on the terms and subject to the conditions thereof, (i) two senior secured term 
loan facilities in an aggregate principal amount of up to $500 million,         
including a multi-draw Tranche A term loan facility in an aggregate principal   
amount of $100 million that matures July 7, 2005 and a Tranche B term loan      
facility in an aggregate principal amount of $400 million that matures July 7,  
2007, and (ii) a five-year senior secured revolving credit facility in an       
aggregate principal amount of up to $500 million, all of which was available in 
the form of letters of credit. Initial borrowings under the Prepetition Senior  
Secured Credit Facility totaled $400 million, representing the full amount      
available under the Tranche B term loan facility. The Prepetition Senior Secured
Credit Facility contained affirmative, negative and financial covenants and     
specified events of default which are typical for a credit agreement governing  
credit facilities of the size, type and tenor of the Prepetition Senior Secured 
Credit Facility. Among the covenants were those limiting the ability of WGI and 
certain of its subsidiaries to incur debt or liens, provide guarantees, make    
investments and pay dividends or repurchase shares. On October 5, 2000, the     
Company terminated the Tranche A term loan facility due to its determination    
that near term borrowing capacity was sufficient and to eliminate ongoing       
related commitment fees.                                                        

               As of the Petition Date, the total amount outstanding under
the Prepetition Senior Secured Credit Facility was approximately $702 million,  
comprised of approximately $400 million in term loans outstanding and           
approximately $302 million in letter of credit advances. As of July 19, 2001,   
approximately $172 million of the letter of credit advances had been funded (for
a total of $572 million of funded debt) and approximately $130 million of       
undrawn letters of credit under the Prepetition Senior Secured Credit Facility  
remained outstanding. Borrowings under the Prepetition Senior Secured Credit    
Facility are secured by WGI and the guarantors pursuant to a grant of a security
interest in the property, interests in property and proceeds thereof now owned  
or hereafter acquired by those entities, subject to certain specified exceptions
(the "Prepetition Collateral").                                                 

                The Debtors and the Prepetition Secured Lenders believe that
Prepetition Collateral constitutes substantially all of the value of the        
Company. Based upon the valuation of the Company by Lazard (see SECTION XI.E),  
such value is less than the amount of funded debt owed to the Prepetition       
Secured Lenders. Accordingly, under the Plan, the Claims of the Prepetition     
Secured Lenders under the Prepetition Senior Secured Credit Facility are        
bifurcated into the Secured Lender Claims and the Lender Deficiency Claims,     
consistent with section 506(a) of the Bankruptcy Code. The amount of Secured    
Lender Claims Allowed under the Plan is approximately $505 million (subject to  
adjustment (if any) by the Confirmation Hearing based upon issuance of the      
Washington Stock Options), based on the                                         

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valuation discussion below. Lender Deficiency Claims will be established by the 
Confirmation Hearing based primarily upon the amount of funded debt owed to the 
Prepetition Secured Lenders (including any additional draws prior to the        
Confirmation Hearing on the letters of credit that have not as yet been drawn,  
which currently total $130 million) MINUS the amount of the Secured Lender      
Claims. The Secured Lender Claims are classified as Class 6 Claims. Under the   
Plan, on the Effective Date, each holder of an Allowed Class 6 Claim, in full   
satisfaction, settlement, release, and discharge of and in exchange for such    
Allowed Class 6 Claim, will receive on or as soon as practicable after the      
Distribution Date, its Pro Rata share of 100% of the New Common Shares (subject 
to dilution by the Management Options and the Washington Stock Options). Lender 
Deficiency Claims are classified as Class 7 Claims. SEE SECTION VI.C.2.(B).     

               The Creditors' Committee disagrees with both the conclusion
concerning the value of the Company and the scope of the liens and security     
interests claimed by the Prepetition Secured Lenders as set forth in this       
Disclosure Statement. The Committee has advised the Debtors that, based upon a  
preliminary evaluation of the Debtors' business plan by the Creditors'          
Committee's financial advisor, Chanin Capital Partners, it believes that the    
enterprise value of WGI and the other Debtors to be well in excess of the amount
necessary to fully compensate the Prepetition Secured Lenders. In addition, the 
Creditors' Committee believes that substantial assets were not included in the  
Collateral securing the Prepetition Senior Secured Credit Facility by agreement 
and that no attempt was made to perfect the liens or security interests of the  
Prepetition Secured Lenders in other assets which are also of substantial value.
The Creditors' Committee is continuing to investigate these issues. The         
Creditors' Committee has commenced an adversary proceeding against CSFB, as     
Agent for the Prepetition Secured Lenders, to determine the validity, priority  
and extent of the liens and security interests asserted by the Prepetition      
Secured Lenders in the property of the Debtors and to determine the effect of   
section 552(b)(1) of the Bankruptcy Code on the Secured Lender Claims. While the
matter is in litigation, if the Creditors' Committee prevails, the result may be
to determine that a significant amount of the Debtors' property is (a) not      
Collateral securing the Prepetition Senior Secured Credit Facility and available
to the holders of Allowed Class 7 Claims or (b) must be equitably shared between
the Prepetition Secured Lenders and the holders of Allowed Class 7 Claims. The  
Creditors' Committee's contentions are disputed by the Debtors and the          
Prepetition Secured Lenders.                                                    

3.       UNSECURED DEBENTURES                                 

                  In connection with the acquisition of the RE&C Businesses, WGI
also issued and sold $300 million aggregate principal amount of senior notes due
July 1, 2010 (the "Old Notes"). The Old Notes were issued pursuant to an        
Indenture dated as of July 7, 2000 and are unsecured. United States Trust       
Company of New York is the Indenture Trustee under that Indenture. The Old Notes
are unsecured senior obligations of WGI and are guaranteed by the same          
subsidiaries that guaranteed the obligations under the Prepetition Senior       
Secured Credit Facility. The Old Notes mature on July 1, 2010. Interest on the  
Old Notes was payable semiannually in arrears on January 1 and July 1,          
commencing January 1, 2001. The Old Notes were sold in a private offering to    
CSFB, BMO Nesbitt Burns Corp., and U.S. Bancorp Libra. The The Old Notes accrued
interest at a rate of 11% per annum through September 20, 2000, and at a rate of
11.5% per annum thereafter. The Old Notes effectively rank junior to all of     
WGI's secured indebtedness and to all liabilities of the subsidiaries of WGI    
that are not guarantors of the Old Notes. The Old Notes, however, are not       
contractually subordinated to the obligations under the Prepetition Senior      
Secured Credit Facility. The indenture under which the Old Notes were issued    
contains affirmative, restrictive and financial covenants and specifies events  
of default which are typical for an indenture governing an issue of high-yield  
senior unsecured notes. Among the covenants are those limiting the ability of   
WGI and certain of its subsidiaries to incur debt or liens, provide guarantees, 
make investments and pay dividends or repurchase shares. As of the Petition     
Date, outstanding Old Note principal obligations total $313 million. The Old    
Note Claims are classified in the Plan as Class 7 Claims, and thus the recovery 
under the Plan to holders of the Old Notes is a pro rata share in the WGI       
Creditor Trust. Under the Plan, on the Effective Date, the Old Notes shall be   
terminated automatically without any further action by any party and shall no   
longer be of any force or effect.                                               

C.       CORPORATE STRUCTURE OF THE COMPANY                                     

1.       CURRENT CORPORATE STRUCTURE                          

                 WGI was originally incorporated in Delaware on April 28, 1993
under the name Kasler Holding Company. In April 1996, the name of the           
corporation was changed from Kasler Holding Company to Washington Construction  
Group, Inc. On September 11, 1996, Washington Construction Group, Inc. merged   
with Morrison Knudsen Corporation, and changed its name to Morrison Knudsen     
Corporation. On September 15, 2000, Morrison Knudsen Corporation changed its    
name to Washington Group International, Inc.                                    

             WGI is a holding company with approximately 97 direct and
indirect subsidiaries in the United States and throughout the world. In         
addition, WGI has ownership interests in approximately 68 limited liability     
companies or joint ventures throughout the world. The Debtors consist of WGI and
71 of its subsidiary affiliates. The Debtors' primary base of operation is in   
the United States.                                                              

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4.       BOARD OF DIRECTORS                                   

       The following is a list, as of July 23, 2001, of the names of each of
the Directors of WGI.                                                           

  Name                                     Title
  ----                                     -----

  Dennis R. Washington                     Chairman and Director

David H. Batchelder                            Director     

Stephen G. Hanks                             Director   

   Robert S. Miller, Jr.                  Vice Chairman and Director

       Dorn Parkinson                     Vice Chairman and Director

Terry W. Payne                              Director  

                 Mr. Washington has been a Director of WGI since 1996, and was
appointed Chairman of WGI in September 1996. He also is founder and principal   
shareholder of Washington Corporations (interstate trucking and repair and sale 
of machinery and equipment), Missoula, Montana; and is founder and/or principal 
stockholder or partner in entities, the principal businesses of which, include  
rail transportation, shipping, barging and ship assist, mining, heavy           
construction, environmental remediation and real estate development. Mr.        
Washington's principal business is to make, manage and hold investments in      
operating entities.                                                             

               Mr. Batchelder has been a Director of WGI since 1993. He is
also Chairman and Chief Executive Officer of Batchelder & Partners, Inc. (an    
investment advisory and consulting firm) and Managing Member of Relational      
Investors LLC (general partner of active investment fund), San Diego,           
California.                                                                     

             Mr. Stephen G. Hanks was named a Director of WGI in June,
2001. Mr. Hanks joined the Company in 1978 as an attorney in the legal          
department. He earned a Bachelor of Science Degree in Accounting from Brigham   
Young University, an MBA from the University of Utah, and a Juris Doctor from   
the University of Idaho, was named President of WGI in April, 2000, and was     
named Chief Executive Officer of WGI in June, 2001.                             

            Mr. Miller has been a Director of WGI since 1996 and was
appointed a Vice Chairman in September 1996. He is also an advisor to Aetna,    
Inc. (health benefits and insurance and financial services), Hartford,          
Connecticut. Mr. Miller formerly served as President of Reliance Group Holdings,
Inc. (fire, marine and casualty insurance), New York, New York; Chairman and    
Chief Executive Officer of Waste Management, Inc. (environmental services),     
Houston, Texas; Acting Chief Executive Officer of Federal-Mogul Corp. (motor    
vehicle parts and accessories), Detroit, Michigan; and Chairman of Old MK.      

               Mr. Parkinson has been a Director of WGI since 1993 and was
appointed a Vice Chairman in September 1996. He is also chairman of and         
consultant to Washington Corporations (interstate trucking and repair and sale  
of machinery and equipment), Missoula, Montana. Mr. Parkinson formerly served as
President of Washington Corporations.                                           

               Mr. Payne has been a Director of WGI since 1993. He is also
Chairman and owner of Terry Payne & Co., Inc. (insurance and construction       
bonding), Missoula, Montana. Mr. Payne also serves as a Director of Washington  
Corporations and First Interstate Bank - Montana, as well as a Director and     
President of Hoiness LaBar Insurance Co., Inc.                                  

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3.       SENIOR OFFICERS                                      

   The following is a list, as of July 23, 2001, of the names of the
executive officers and the positions with WGI held by each officer.             

        Title                                   Name
        -----                                   ----

Chief Executive Officer and President             Stephen G. Hanks  

  Sr. Executive Vice President and               Vincent L. Kontny
Chief Operating Officer                               

  Sr. Executive Vice President and               Charles R. Oliver
Chief Business Development Officer                              

    Executive Vice President and                 George H. Juetten
Chief Financial Officer                               

       Executive Vice President                 G. Bretnell Williams

     Executive Vice President                   Robert C. Wiesel

    Executive Vice President                    David L. Myers
of Corporate Affairs                              

       Executive Vice President                 Ambrose L. Schwallie

     Executive Vice President                   Thomas H. Zarges

                  Stephen G. Hanks was named President of WGI in April 2000. Mr.
Hanks was named Chief Executive Officer in June, 2001. Prior to that date, Mr.  
Washington was Chief Executive Officer.                                         

                 Vincent L. Kontny was named chief operating officer of WGI in
April 2000 with overall responsibility for the company's operating groups. He is
also a member of the Office of the Chairman. Mr. Kontny is the former president 
and chief operating officer of Irvine, California-based Fluor Corporation and   
president of Fluor Daniel, Inc. He earned a civil engineering degree and doctor 
of science honoris causa from the University of Colorado. He also attended the  
Stanford Executive Program.                                                     

                  Charles R. Oliver was named chief business development officer
in January 2001 and is a member of the Office of the Chairman. Mr. Oliver has   
served the engineering and construction industry for 35 years. Prior to joining 
Washington Group International, Mr. Oliver spent 30 years with Fluor Daniel and 
retired in late 1999 as group president of Sales, Strategic Planning, and       
Regions. Mr. Oliver has a degree in civil engineering from Auburn University and
from Stanford University's Executive Program.                                   

            George Juetten, formerly Senior Vice President and Chief
Financial Officer of Dresser Industries, Inc., was appointed an Executive Vice  
President and Chief Financial Officer in January 2001. Mr. Juetten spent six    
years with Dresser Industries, where he also served as Vice President -         
Controller from 1993 to 1996. Prior to joining Dresser Industries, Mr. Juetten  
spent 24 years with Price Waterhouse as an Audit Partner with multinational     
clients, including Dresser Industries. He joined Price Waterhouse in 1969 and   
served in The Hague, Netherlands, from 1974 to 1977. Mr. Juetten holds an       
accounting degree from Marquette University.                                    

              G. Bretnell Williams, formerly Executive Vice President of
Washington Industrial/Process Operations, was appointed President and Chief     
Executive Officer of Washington Industrial/Process in January 2001. Mr.         
Williams, who has been engaged in business development and operations of        
industrial projects for more than four decades, started his career with         
Washington Group as Vice President of Marketing in 1976. He later served as     
President of the company's H.K. Ferguson Company and was named to his present   
position in 1991. Mr. Williams graduated from Yale University with an           
engineering degree in 1951.                                                     

                Robert C. Wiesel is president and chief executive officer of
the Petroleum & Chemicals unit of Washington Group. Joining Stone & Webster     
Engineering Corporation (SWEC) in 1972, Mr. Wiesel began his career as a civil  
engineer in the engineering and design of power generating projects throughout  
the United States. Named the executive vice president of Stone & Webster, Inc., 
and vice chairman of SWEC in 1998, he was one of the four senior executives that
comprised the company's core management team. After 27 years with Stone &       
Webster, Mr. Wiesel joined Raytheon Engineers & Constructors in May of 1999 as  
senior vice president of Petroleum and                                          

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Chemicals. Mr. Wiesel earned a bachelor of science degree in civil engineering  
from the University of Massachusetts and a master's in civil engineering from   
Northeastern University.                                                        

                  David L. Myers, formerly President and Chief Executive Officer
of the Washington Power unit, was named Executive Vice President of Corporate   
Affairs in January 2001. Prior to joining Washington Group, Mr. Myers served as 
Chief Operating Officer at RE&C and as President of Fluor Daniel's Environmental
Strategies Operating Company. Mr. Myers served for seven years in the nuclear   
submarine service, joining Fluor Engineers & Constructors in 1975. Mr. Myers    
oversees key strategic and financial initiatives and provides his industry      
expertise to the Debtors' corporate affairs in the United States and abroad. Mr.
Myers holds a bachelor of sciences degree in electrical engineering from the    
United States Naval Academy, a masters of electrical engineering degree from the
United States Postgraduate School, a masters in administration degree from the  
University of California at Irvine, and attended the Executive Program in       
International Management at Columbia University.                                

                Ambrose L. Schwallie was named president and chief executive
officer of Government unit in August of 1999. He directs the operations that    
serve the United States Departments of Energy and Defense, and other clients in 
the nuclear-services and environmental markets. He had served as president of   
the Westinghouse Savannah River Company (WSRC) since August 1991. Before being  
named president of WSRC, Mr. Schwallie served as the company's executive vice   
president. Previously, Mr. Schwallie was engineering manager for Westinghouse   
Electric Company's Advanced Energy Systems Division. Since beginning his career 
with Westinghouse Electric in 1972, Mr. Schwallie has performed a variety of    
research and engineering activities. He earned bachelor of science and master of
science degrees in Mechanical Engineering from The Ohio State University.       

            Thomas H. Zarges, formerly President and Chief Executive
Officer of WGI's Industrial/Process unit, was named President and Chief         
Executive Officer of Washington Power in January 2001. Mr. Zarges is a 27-year  
veteran of the engineering and construction industry who joined the company in  
1991 as President and Chief Executive Officer of the company's Power and        
Industrial/Manufacturing Divisions. He previously served 17 years with          
Raytheon's former subsidiary United Engineers & Constructors, with supervisory  
and management positions in field construction, engineering, and project        
management. His experience includes major nuclear and fossil-power projects,    
high-technology projects in the steel and process industries, industrial        
manufacturing, and heavy civil construction. He is a 1970 engineering graduate  
of the Virginia Military Institute.                                             

IV. EVENTS LEADING TO COMMENCEMENT OF THE CHAPTER 11 CASES

A.       THE RAYTHEON TRANSACTION                                               

           As discussed in SECTION III.A.2 above, on July 7, 2000,
pursuant to the Stock Purchase Agreement, WGI purchased the RE&C Businesses.    
Because of the size and complexity of the businesses being sold to WGI, the     
Stock Purchase Agreement did not contain a fixed purchase price for the         
transaction, but rather provided that the cash portion of the purchase price    
paid would be calculated using selected audited balance sheet items of the      
acquired businesses as of April 30, 2000, and that the price paid at closing of 
the transaction would be subject to a purchase price adjustment.                

                  Following the closing, WGI undertook a comprehensive review of
existing contracts that were acquired for the purpose of making a preliminary   
allocation of the acquisition price to the net assets acquired. As part of this 
review, WGI evaluated, among other matters, estimates at completion for         
long-term contracts in process as of the acquisition date. The preliminary      
results of this review raised questions about the RE&C Businesses and indicated 
that the estimates at completion of numerous RE&C long-term contracts required  
substantial adjustment. As a result, in its Form 10-Q Quarterly Report for the  
period ended September 1, 2000, WGI significantly decreased the carrying value  
of the net assets acquired and increased the goodwill associated with the       
transaction. WGI's investigation of the RE&C Businesses continued thereafter,   
and, based on the results of that review, WGI expected that the purchase price  
adjustment would be significant.                                                

                 Under agreements between Raytheon and WGI, Raytheon agreed to
provide the April 30, 2000 audited balance sheet of the RE&C Businesses by      
January 14, 2001. Delivery by Raytheon of this balance sheet was required to    
begin the purchase price adjustment process under the Stock Purchase Agreement. 
The balance sheet was not delivered at that time and had not been delivered as  
of May 14, 2001. As a result of Raytheon's failure to comply with the purchase  
price adjustment process, WGI did not obtain any adjustment to the purchase     
price by May 14, 2001.                                                          

        As a result of WGI's post-closing review of the RE&C
Businesses, WGI also believes that Raytheon committed fraud in connection with  
the sale of the RE&C businesses. In a lawsuit filed on March 8, 2001, WGI       
alleges that Raytheon's management consistently engaged in inappropriate        
accounting practices and intentional earnings manipulation by overstating       
revenue, understating                                                           

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costs, avoiding recognition of losses and thereby severely overstating profits  
and understating losses on numerous projects. These activities concealed        
significant cost overruns and negative cash flows at many of the RE&C projects  
acquired. These undisclosed cost overruns and negative cash flows, combined with
WGI's inability to receive a purchase price adjustment from Raytheon in a timely
manner, created a severe, near-term liquidity crisis for the Company.           

            It is anticipated that, during the Chapter 11 Cases, the
Debtors will reject the Stock Purchase Agreement and certain related agreements,
after notice and a hearing by the Bankruptcy Court.                             

           See APPENDIX D for a statement of position by Raytheon.

B.       LIQUIDITY ISSUES                                                       

                The Company's liquidity crisis became acute by late February
and early March, 2001. Two projects with respect to which Raytheon retained     
liability under guaranty agreements with the project owners - projects to build 
power plants in Massachusetts for Sithe - had particularly negative cash flows. 
In order to preserve cash and be able to continue operations, the Company was   
forced to take the unprecedented action of suspending performance on those two  
projects in March, 2001. See SECTION V.I.2 for a discussion of the litigation   
commenced against the Debtors by Mitsubishi with respect to the Sithe project.  

                 The Company initially sought to solve its liquidity crisis by
pursuing alternatives that could have avoided the need to commence the Chapter  
11 Cases. First, the Company sought to negotiate some type of settlement with   
Raytheon. Those attempts were unsuccessful. Second, the Company attempted to    
negotiate with the Prepetition Secured Lenders as well as other lending         
institutions to procure additional financing outside of a Chapter 11 filing.    
Those efforts were also unsuccessful. Third, the Company retained Lazard to     
solicit interest from potential third parties in the sale of the Company. No    
offers were received that the Company and the Prepetition Secured Lenders       
believed reflected the fair value of the businesses. As a result, the Company's 
only alternative to obtain the additional liquidity to continue operations and  
preserve going concern value was the financing offered by the DIP Lenders       
pursuant to a Chapter 11 filing. See SECTION V.C for a summary of the DIP       
Facility. The Creditors' Committee and certain other parties have asserted that 
they dispute the adequacy of the Debtors' prepetition efforts to sell all or    
part of their businesses. The Debtors contest that assertion. See SECTION       
X.II.B.                                                                         

C.       NEGOTIATIONS WITH PREPETITION SECURED LENDERS                          

        The ability of the Company, like any engineering and
construction company, to maintain and grow its going concern value, depends, in 
large measure on the ability to continue to procure new work. The Company's     
projects are typically large, complex projects that take years to complete and, 
often involve investments of tens, if not hundreds, of millions of dollars by   
project owners. Not surprisingly, many customers are reluctant to award new work
to a company in Chapter 11. The ability to procure bonds to secure performance, 
which is often required to be awarded new work by a project owner, is extremely 
difficult for a Chapter 11 debtor.                                              

        As a result, prior to the Petition Date, the Company
determined that if a Chapter 11 filing was unavoidable, the only way to preserve
going concern value was to take steps designed to complete the restructuring    
process quickly. To that end, in conjunction with the negotiations with the     
Prepetition Secured Lenders for the DIP Facility, the Company began negotiations
on the terms of a reorganization plan. The Company believed that it was         
imperative if value was to be preserved and maximized for the benefit of all    
creditors, that the commencement of the Chapter 11 Cases be accompanied by the  
filing of a reorganization plan, both to demonstrate to customers, vendors and  
contractors and employees that a restructuring would be completed quickly and   
to, in fact, attempt to complete the process as quickly as practicable.         
Consistent with that view, the DIP Lenders and Prepetition Secured Lenders      
expressly conditioned their willingness to provide and consent to, respectively,
the DIP Facility, upon the concurrent filing of a reorganization plan acceptable
to them in principle. As a result, a draft reorganization plan was filed on May 
14, 2001, reflecting the results of the Company's negotiations with the         
Prepetition Secured Lenders and the DIP Lenders. Subsequently, that plan was    
amended to incorporate the agreement reached with Mr. Dennis Washington, as     
described in SECTION V.G, which agreement is embodied in the Plan.              

 V. CHAPTER 11 CASES

A.       CONTINUATION OF BUSINESS; STAY OF LITIGATION                           

                 On May 14, 2001, the Debtors filed petitions for relief under
Chapter 11 of the Bankruptcy Code. Since the Petition Date, the Debtors have    
continued to operate as debtors-in-possession subject to the supervision of the 
Bankruptcy Court and in accordance with the Bankruptcy Code. Under the          
Bankruptcy Code, the Debtors are required to comply with certain statutory      
reporting requirements,                                                         

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including the filing of monthly operating reports. As of the date hereof, the   
Debtors have complied with such requirements and with which the Debtors will    
continue to comply. The Debtors are authorized to operate their business in the 
ordinary course of business, with transactions out of the ordinary course of    
business requiring Bankruptcy Court approval.                                   

                An immediate effect of the filing of the Debtors' bankruptcy
petitions is the imposition of the automatic stay under the Bankruptcy Code     
which, with limited exceptions, enjoins the commencement or continuation of all 
collection efforts by creditors, the enforcement of liens against property of   
the Debtors and the continuation of litigation against the Debtors. This relief 
provides the Debtors with the "breathing room" necessary to assess and          
reorganize their business. The automatic stay remains in effect, unless modified
by the Bankruptcy Court, until consummation of a plan of reorganization.        

B.       FIRST DAY ORDERS                                                       

              On the first day of these cases, the Debtors filed several
motions seeking certain relief by virtue of so-called "first day orders." First 
day orders are intended to facilitate the transition between a debtor's         
prepetition and postpetition business operations by approving certain regular   
business practices that may not be specifically authorized under the Bankruptcy 
Code or as to which the Bankruptcy Code requires prior approval by the          
Bankruptcy Court. Many of the first day orders obtained in these cases are      
typical for large Chapter 11 cases. Other first day relief, as described more   
fully below, was atypical and was specifically designed to preserve the value of
the Debtors' estates by enabling the Debtors to continue to work on ongoing     
projects and receive the revenue associated therewith in the ordinary course.   

            THE DESCRIPTIONS OF THE RELIEF SOUGHT OR OBTAINED IN THE
CHAPTER 11 CASES SET FORTH BELOW AND THROUGHOUT THIS DISCLOSURE STATEMENT ARE   
SUMMARIES ONLY. ALL PLEADINGS FILED IN THE CHAPTER 11 CASES, AND ALL ORDERS     
ENTERED BY THE BANKRUPTCY COURT, ARE PUBLICLY AVAILABLE AND MAY BE FOUND,       
DOWNLOADED AND PRINTED FROM THE WGI WEBSITE FOUND AT http//www.wgint.com. or    
http//www.nvb.uscourts.gov.                                                     

             The more typical first day orders in the Chapter 11 Cases
authorized, among other things:                                                 

                  a.       the retention of the following professionals to serve
                         on behalf of the Debtors: (i) Skadden, Arps, Slate,
                      Meagher & Flom (Illinois) and its affiliated law
                          practices, as bankruptcy counsel; (ii) Lionel Sawyer
                        & Collins as local bankruptcy counsel; (iii) Zolfo
                Cooper, LLC ("Zolfo Cooper") as bankruptcy
                      consultants and special financial advisors; (iv)
                           Lazard as investment banker; and (v) Robert L. Berger
                           & Associates, LLC, as solicitation and noticing agent
(the "Claims Agent");     

                  b.       the continued retention of Jones, Day, Reavis & Pogue
                 to provide legal services to the Debtors in
                      connection with various corporate and litigation
                    matters, including litigation arising from the
         acquisition of the RE&C Businesses;

               c.       the continued retention of professionals regularly
                       employed by the Debtors in the ordinary course of
business;                 

              d.       the maintenance of the Debtors' bank accounts and
                operation of their cash management systems
                        substantially as such systems existed prior to the
Petition Date;            

                e.       payment of employees' accrued prepetition wages and
employee benefit claims;  

        f.       payment of prepetition shipping, warehouse,
                          distributor or broker charges and related possessory
liens;                    

                  g.       continued utility services during the pendency of the
Chapter 11 Cases;         

       h.       payment of certain prepetition tax claims;

                  i.       confirmation that the Debtors' undisputed obligations
                           arising from postpetition delivery of goods will have
             administrative expense priority status,
                          administrative expense treatment for certain holders
                       of valid reclamation claims, and authority to pay
                          certain expenses in the ordinary course of business;

         j.       joint administration of each of the Debtors'
bankruptcy cases.         

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              Importantly, on the first day of the Chapter 11 Cases, the
Debtors also obtained entry of an order by the Bankruptcy Court authorizing them
to continue to pay, in the ordinary course of business, vendors, subcontractors 
and other creditors ("Critical Vendors") that provide goods and services for    
ongoing projects (the "Critical Vendor Order") subject to a cap of $170 million.
Absent the ability to make such payments, the Debtors believe that continued    
receipt of payments from project owners would be jeopardized for a number of    
reasons. For example, absent payment of subcontractors, such subcontractors     
would be able to assert mechanics liens against project owner property, and such
project owners could divert payments that would otherwise be made to the Debtors
to subcontractors to satisfy such liens. Moreover, the Debtors would be unable  
to continue to force subcontractors to continue work on projects absent payment 
of their claims, which would result in the Debtors defaulting on project        
contracts, triggering the right of owners to call on performance or other bonds 
issued for their benefit by the Debtors' sureties. Such events would trigger    
equitable subrogation claims by such sureties to the future payments otherwise  
due to the Debtors under those contracts, severely compromising, if not         
eliminating, the Debtors' receipt of ongoing project revenue.                   

            As a result, the Debtors sought approval of the Critical
Vendor Order. Importantly, by its terms, the Critical Vendor Order requires a   
vendor or subcontractor whose prepetition claim is paid thereunder to continue  
to provide goods and services to the Debtors on ordinary payment terms. This    
mechanism ensures that the Debtors continue to receive trade credit support from
their Critical Vendors, which provides a significant liquidity benefit to the   
Debtors' estates. A list of each Critical Vendor that has received payments to  
date or that is anticipated to receive such payments during these Chapter 11    
Cases is attached hereto as APPENDIX E.                                         

C.       DEBTOR IN POSSESSION FINANCING                                         

1.       THE DIP FACILITY                                     

               As noted above, the Company required substantial additional
liquidity to fund operations during the Chapter 11 Cases. Accordingly, on the   
Petition Date, the Debtors sought and obtained interim authority to enter into  
the DIP Facility with CSFB as administrative agent, and the DIP Lenders. Final  
authority to enter into the DIP Facility was granted by the Bankruptcy Court on 
June 13, 2001. Specifically, the DIP Facility provides for secured postpetition 
financing from the DIP Lenders in an aggregate principal amount not to exceed   
$350 million, with $220 million fully committed as of the date hereof, and up to
an additional $130 million to be sought to be made available. The DIP Facility  
has a term of nine months. The Debtors have and will continue to utilize the    
funds provided by the DIP Facility for general working capital and the Debtors' 
other general corporate purposes. As of the Effective Date, the Debtors'        
obligations under the DIP Facility are projected to equal approximately $30     
million of funded loans plus approximately $40 million in outstanding letters of
credit. Actual amounts may be higher or lower. The Debtors' draws on the DIP    
Facility to date have been lower than expected primarily due to the lack of     
deterioration in expected receipts from the Debtors' customers and better than  
anticipated postpetition trade credit being received by the Debtors.            

          To secure the repayment of the borrowing and all other
obligations arising under the DIP Facility, the Debtors granted the DIP Lenders 
first priority liens on substantially all of their assets, SENIOR to the liens  
of the existing Prepetition Secured Lenders, but junior to other valid liens    
existing on the Petition Date. Obligations under the DIP Facility were also     
granted "superpriority" claim status under section 364(c)(1) of the Bankruptcy  
Code, meaning they have priority over all other administrative expenses. The    
liens and claims granted to the DIP Lenders are subject to the fees and expenses
of the Office of the United States Trustee under 28 U.S.C. Section 1930 and the 
Clerk of the Bankruptcy Court, as well as a $2 million carve-out for fees and   
disbursements of the professionals of the Debtors and the Creditors' Committee  
incurred after an event of default under the DIP Facility.                      

                 The DIP Facility also contains covenants, representations and
warranties, events of default, and other terms and conditions typical of credit 
facilities of a similar nature. Among the events of default is the failure of   
certain events to occur by designated deadlines, such as approval of the        
Disclosure Statement by the Bankruptcy Court and Confirmation of the Plan.      
Importantly, the DIP Facility limits the Debtors' borrowing ability to the terms
of a budget agreed upon by the Debtors and the DIP Lenders.                     

            Pursuant to the Bankruptcy Court order approving the DIP
Facility, the DIP Lenders and the Agent are provided certain releases. See      
SECTION V.B of this Disclosure Statement for information as to how to view this 
order (and other pleadings in these Chapter 11 Cases) on the Debtors' website.  

2.       AUTHORIZATION TO USE CASH COLLATERAL                 

                 The cash the Debtors had on hand as of the Petition Date, and
substantially all cash received by the Debtors during the Chapter 11 Cases,     
constitutes "cash collateral" of the Prepetition Secured Lenders. Cash          
collateral is defined in section 363 of the Bankruptcy Code and includes, but is
not limited to, "cash, negotiable instruments, documents of title, securities,  
deposit accounts, . . .                                                         

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other cash equivalents . . . and . . . proceeds, products, offspring, rents or  
profits of property subject to a security interest . . . ." 11 U.S.C. Section   
363(a). Under the Bankruptcy Code, the Debtors are prohibited from using,       
selling, or leasing cash collateral unless either the appropriate creditor(s)   
consent or the Bankruptcy Court, after notice and a hearing, authorizes such    
action. In connection with the DIP Facility, the Debtors obtained authority to  
enter into a stipulation to use the Cash Collateral to pay current operating    
expenses, including payroll and to pay subcontractors and other vendors to      
ensure that projects continue and to ensure a continued supply of materials     
essential to the Debtors' continued viability.                                  

3.       EXIT FINANCING                                       

             On the Effective Date of the Plan, the Debtors anticipate
entering into a new senior secured facility (the "Exit Facility") in order to   
(a) repay amounts outstanding on the Effective Date under the DIP Facility, (b) 
make other payments required to be made on the Effective Date or the            
Distribution Date, and (c) provide such additional borrowing capacity as is     
required by the Debtors following the Effective Date to maintain their          
operations. As of the date hereof, no commitment for an Exit Facility has been  
obtained. SEE SECTION V.L.1.(f).                                                

D.       APPOINTMENT OF CREDITORS' COMMITTEE                                    

                  On May 21, 2001, the United States Trustee for the District of
Nevada appointed, pursuant to section 1102(a) of the Bankruptcy Code, certain   
entities to the Official Committee of Unsecured Creditors of the Debtors (the   
"Creditors' Committee"). The members of the Creditors Committee are United      
States Trust Company of New York; Oaktree Capital Management, LLC; Principal    
Life Insurance Company; Teachers Insurance and Annuity Association of America;  
Toshiba International Corp.; MK Gold Company; Boccard USA Corporation; Kinetics 
Systems Inc.; and Mitsubishi. The Creditors' Committee retained Murphy Sheneman 
Julian & Rogers, PC as counsel and Chanin Capital Partners as financial         
advisors.                                                                       

E.       OTHER MATERIAL RELIEF OBTAINED DURING THE CHAPTER 11 CASES             

                  In addition to the first day relief sought in these Chapter 11
Cases, the Debtors have sought or anticipate seeking authority with respect to a
multitude of matters designed to assist in the administration of the Chapter 11 
Cases, to maximize the value of the Debtors' estates and to provide the         
foundation for the Debtors' emergence from Chapter 11. Set forth below is a     
brief summary of certain of the principal motions the Debtors have filed during 
the pendency of the Chapter 11 Cases.                                           

         1.       EMPLOYEE RETENTION PROGRAM AND CONTINUANCE OF PTO PROGRAM - On
                 the Petition Date, the Debtors filed a motion (the "Retention
                and Severance Motion") with the Bankruptcy Court, requesting
             Bankruptcy Court approval of a program (the "Key Employee
             Retention Program") designed to retain key executives and
                 employees. The Key Employee Retention Program consists of two
      separate components: (i) the implementation and\or
                 continuation of an employee retention program (the "Retention
         Program") and (ii) an employee severance program (the
                "Severance Program"). The Retention and Severance Motion, as
             amended to reflect certain agreements with the Creditors'
               Committee, was approved by the Bankruptcy Court on June 25,
                2001. The Key Employee Retention Program is an integral part
                 of a comprehensive employee retention program designed by the
         Debtors to minimize management and employee turnover.

               The Retention Program consists of five separate components:
           (i) corporate and management retention ("Part I"); (ii)
              project retention ("Part II"); (iii) power group retention
              ("Part III"); (iv) Harquala retention ("Part IV"); and (v)
                former Raytheon Engineers & Constructors executive retention
                  ("Part V"). Part I covers key personnel that provide strategic
               and administrative functions for the Debtors. Key employees
                included in Part I will receive three equal payments made at
               six month intervals, beginning in September, 2001, with the
                  final payment conditioned upon confirmation of the Plan. Parts
                  II, III, and IV cover key employees related to certain project
                 work currently underway by the Debtors. Key employees covered
                 under Part II will receive two equal payments made six months
              apart, beginning in September, 2001. Key employees covered
               under Part III will receive one payment in September, 2001.
               Key employees covered under Part IV will receive a lump sum
         payment in November, 2001. Under Part V, certain RE&C
             executives who are currently employed by the Debtors will
                  receive the remaining two of three scheduled payments in July,
                  2001 and July, 2002. The first of the three scheduled payments
            was made in June, 2000 pursuant to a program designed by
                Raytheon to retain key RE&C executives after the acquisition
              of the RE&C Businesses. The maximum aggregate amount to by
        paid out under the Retention Program is $31,894,252.

              The Severance Program is necessary in order to ensure that
           employees will not be terminated without receiving some
              compensation in the form of severance. Under the Severance
     Program, the Debtors (i) may enter into severance

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           agreements with employees hired to replace officers who
           previously had severance agreements and (ii) continue a
               severance program that was instituted prior to the Petition
                  Date (the "Prepetition Severance Program"), assuring employees
            that any severance claims they may hold will be accorded
                 postpetition administrative status. The Prepetition Severance
                Program began in March, 2001 and continues through December,
              2002 and under its terms, a participant receives severance
                benefits if such participant suffers a decrease in pay or is
          forced to make an unacceptable relocation. The maximum
            aggregate amount of payments that could theoretically be
      required to be made under the Severance Program is
                $24,432,464, with limitations on the amount that can be paid
prior to the Effective Date of the Plan.    

                 In addition, on the Petition Date, the Debtors filed a motion
                 (the "PTO Motion") to continue a certain prepetition employee
                benefit program as modified, through which employees accrued
              paid time off ("PTO") during each pay period that could be
             used (subject to supervisory approval) for vacation, sick
               leave, bereavement, religious observances and certain other
                 purposes (the "PTO Program"). Eligible employees may also buy
             or sell up to 40 hours of future PTO annually. Unused PTO
                 carries over from year to year and can accrue up to a maximum
                 of 12-20 weeks depending on the employee's length of service.
                Additionally, under the PTO Program, an eligible employee is
                  entitled to payment of accrued paid time off upon termination.

               The Debtors believe that continuation of the PTO Program is
                essential to the continued employment, active participation,
            and dedication of the Debtors' employees who possess the
           knowledge, experience and skill to support the Debtors'
             business operations. The Debtors estimate that, as of the
              Petition Date, accrued unpaid PTO aggregates approximately
               $42.7 million or approximately $4,528 per employee. The PTO
                 Motion was approved by the Bankruptcy Court on June 13, 2001.

       2.       INTERIM ARRANGEMENTS REGARDING RED OAK AND ILIJAN PROJECTS -
                The Red Oak project is a construction project in Sayerville,
         NJ, for the construction of a combined cycle electric
                generating plant (the "Red Oak Project"). The Ilijan project
                 is a construction project in the Republic of Philippines, for
                 the construction of a natural gas-fired generating plant (the
                 "Ilijan Project"). Both projects were acquired as part of the
              RE&C Businesses Acquisition, and the Company's performance
            under both the Red Oak Project and the Ilijan Project is
                 guaranteed by Raytheon pursuant to guarantees executed at the
inception of the projects.                  

               The Ilijan Project and Red Oak Project are projected by the
              Company to be cash flow negative for the Company after the
             Petition Date. Due to budgetary constraints under the DIP
                 Facility, the Company could not make further expenditures for
           costs and expenses on the Ilijan Project or the Red Oak
                 Project unless and until the project owners, Raytheon and the
             DIP Lenders agreed to an arrangement that would allow the
                 Company to continue work on the projects but would reform the
                 structure of payments to be cash-flow neutral to the Company.

               Accordingly, on May 22, 2001, the Debtors, the DIP Lenders,
           Raytheon, and the respective Red Oak and Ilijan Project
                  owners, reached interim agreements that allowed the Company to
                 continue work on those projects on a cash-flow neutral basis.
                With respect to the Ilijan Project, the project owner agreed
           to make remaining contract payments to Raytheon and the
                  Debtors' partner on the project, (Mitsubishi), rather than the
           Debtors. The Debtors, in turn, are paid by Raytheon and
                 Mitsubishi weekly in advance for estimated costs and expenses
            on the project. All parties' respective rights to assert
             claims against one another arising out of the prepetition
          contracts, are fully preserved. This interim agreement
         currently expires on July 27, 2001, and a longer-term
       agreement, on substantially similar terms, is under
negotiation.                                

              With respect to the Red Oak Project, the interim agreement
          reached provides for the project owner to make certain
                specified payments to the Company. The Company has agreed to
             segregate those funds and utilize them only for costs and
                 expenses incident to the Red Oak Project, and to use no other
                funds for the project. As of the date hereof, this agreement
                 extends through approximately August 3, 2001, and is expected
           to be extended. A longer-term arrangement is subject to
                  pending negotiations. In addition, before the Petition Date, a
            letter of credit was issued under the Prepetition Senior
                 Secured Credit Facility for the benefit of the project owner,
              to secure the Company's performance. Prior to the Petition
          Date, that letter of credit was drawn in the amount of
              approximately $95 million. The Prepetition Secured Lenders
                  have asserted that the letter of credit should have been drawn
                 in the amount of $82 million based on information provided to
               the Prepetition Secured Lenders by the Company. The Company
                 disputes that contention. All parties' rights with respect to
              this issue, as well as any other claims arising out of the
                  prepetition contracts for the Red Oak Project, have been fully
preserved.                                  

                 These agreements allow the Company to continue working on the
         Red Oak and Ilijan Projects and to pay all employees,

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                  vendors and subcontractors in the ordinary course of business.
          At this time, there can be no assurance that long-term
                 agreements for the continued performance of these projects by
               the Company and funding to the Company for that performance
will be able to be reached.                 

         3.       EXTENSION OF TIME TO ASSUME OR REJECT UNEXPIRED LEASES - Given
                  the size and complexity of these Chapter 11 Cases, the Debtors
                  determined that they will be unable to complete their analysis
              of all nonresidential real property leases during the time
                limitation prescribed in section 365(d)(4) of the Bankruptcy
                  Code. Accordingly, the Debtors sought an extension of the time
        by which the Debtors must assume or reject leases of
                nonresidential real property, which extension was granted by
            the Bankruptcy Court on July 9, 2001, and expires on the
                  earlier of (i) November 15, 2001 or (ii) the effective date of
            any confirmed plan of reorganization in these Chapter 11
                 Cases. All such leases will be assumed under the Plan, except
               for those leases specified on SCHEDULE 6.3 of the Plan. SEE
SECTION VI.M.1.                             

         4.       POSTPETITION BONDING FACILITY - The ability of a contractor to
               be awarded many types of construction projects depends upon
             the ability to have issued payment, performance and other
             types of bonds for the benefit of the project owners. The
                  Debtors have outstanding many such bonds on existing projects,
              and need to be able to issue more of such bonds to be in a
                 position to procure new contract awards and thus preserve and
maximize the value of these estates.        

                 Bonding companies are sureties, and they expose themselves to
              significant financial risks when they issue a bond. If the
                  principal to the construction contract defaults, the surety is
              required to perform the contract in place of the principal
             pursuant to the terms of the bonds. Under surety law, the
               surety essentially becomes the owner of future monies to be
                  paid under the contract by the project owner; however, despite
                  that protection, completion of a defaulted project may be at a
               substantial loss to the surety, because it bears all bonded
               costs and expenses of completion of the project. The surety
                has claims for its losses against the defaulting contractor.

            As a result, any surety cautiously screens applicants to
             minimize its potential exposure. Such screening obviously
                includes an examination of the principal's financial health.
                  Not surprisingly, sureties are reluctant to incur bonding risk
             for a Chapter 11 debtor. The Debtors are not aware of any
      instance where a Chapter 11 debtor that is a large
            construction company has been able to obtain significant
bonding capacity while in bankruptcy.       

             In order to attempt to maintain and maximize value to the
                 greatest extent possible under the circumstances, the Debtors
           began negotiations with one of their principal existing
             sureties, Federal Insurance Company (with its affiliates,
              "Federal"), to be able to have new bonds issued during the
                Chapter 11 Cases. The Debtors believe that the ability to do
             so, if obtained, would greatly increase the chances to be
            awarded new projects during the Chapter 11 Cases, to the
ultimate benefit of all creditors.          

              As a result of these efforts, on June 8, 2001, the Debtors
               filed a motion (the "Federal Motion") seeking approval of a
                term sheet with Federal and to enter into a bonding facility
              (the "Federal Bonding Facility") consistent therewith. The
                  Federal Motion was approved be the Bankruptcy Court on July 9,
               2001. The Federal Bonding Facility essentially provides for
               the issuance of up to $100 million of new bonds for Company
            projects. The Federal Bonding Facility also contemplates
                  additional bonding for new projects of joint ventures in which
               the Company participates. Provisions for the replacement of
     certain existing Federal bonds are also included.

            The Federal Bonding Facility requires the Debtors to pay
                 various fees and expenses to Federal including a $1.5 million
                  commitment fee and a 1% fee on the amount of new bonds issued.
         Letter of credit and/or Cash collateralization of all
                stand-alone Company bonds in amounts averaging approximately
                  40% of the face amount of the bond is also required, with such
           collateral securing all new bond obligations as a pool.

               Further, the Federal Bonding Facility requires (i) that the
                  Debtors grant liens on certain assets to secure obligations to
                 Federal; (ii) the assumption of certain prepetition contracts
                under section 365 of the Bankruptcy Code; and (iii) that the
           Bankruptcy Court deem all Claims of Federal under bonds
            outstanding as of the Petition Date to be administrative
             priority claims under Section 503 of the Bankruptcy Code.

                The Federal Bonding Facility remains subject to agreement on
                final documentation by the Debtors, Federal, the DIP Lenders
and the Creditors' Committee.               

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F.       APPOINTMENT OF AN EXAMINER                                             

                  On May 25, 2001, Mitsubishi filed a motion seeking appointment
of an examiner under section 1104 of the Bankruptcy Code (the "Examiner         
Motion"). Mitsubishi requested that the examiner be appointed to conduct an     
investigation of, in essence, all of the Debtors' prepetition financial affairs.

                 On June 7, 2001, the Debtors filed a response to the Examiner
Motion. The Debtors did not believe that appointment of an examiner would be in 
the best interests of the Debtors' estates. Section 1104 of the Bankruptcy Code,
however, has been held by some courts to require appointment of an examiner     
under certain circumstances if requested by a party in interest.                

             As discussed in SECTION IV.C, the Debtors believe that an
expeditious completion of these Chapter 11 Cases is critical to preserving the  
Debtors' ongoing concern enterprise value. As a result, the Debtors concluded   
not to contest appointment of an examiner, to avoid the potential for delay if  
the Debtors were to litigate the Examiner Motion on its merits.                 

                 At a hearing conducted on June 13, 2001, the Bankruptcy Court
directed the United States Trustee to appoint an examiner. Mr. Jeffrey Truitt of
KPMG, and KPMG were appointed as examiners pursuant to an order entered by the  
Bankruptcy Court on June 28, 2001. The examiner is expected to file a report    
regarding the events leading to the commencement of the Chapter 11 Cases on or  
about August 22, 2001.                                                          

G.       NEGOTIATIONS AND AGREEMENT WITH MR. WASHINGTON                         

                  Mr. Washington has been Chairman of WGI since September, 1996.
He has a long history of involvement in the construction industry, and has been 
instrumental in the operating success of the Company. Mr. Washington indicated  
that he was interested in continuing his involvement with the Company, subject  
to agreement on compensation to be provided for his ongoing services. The       
Steering Committee for the Prepetition Lenders and the Debtors believe that Mr. 
Washington's continued commitment to the Company, both in terms of active       
participation in its management, as well as through ongoing economic investment,
will be highly beneficial to the Company's future prospects.                    

              As a result, shortly after the Petition Date, the Steering
Committee for the Prepetition Secured Lenders and Mr. Washington began          
negotiations regarding Mr. Washington's continued involvement with the Company  
during and after the Chapter 11 Cases. Mr. Washington's current equity stake in 
the Company - his ownership of Old Common Stock - will be cancelled under the   
Plan. Mr. Washington expressed, in those negotiations, his position that a      
condition to his willingness to continue to serve on the WGI's Board of         
Directors and allow the Company to utilize the "Washington" name and trademark, 
was dependent upon reaching agreement on the terms and conditions for           
consideration to be provided to him in exchange.                                

         The result of those negotiations is an agreement (the
"Washington Agreement"), which is embodied in the Plan. The Washington Agreement
is comprised of the following components:                                       

        1.       GRANT OF WASHINGTON STOCK OPTIONS - On the Effective Date, Mr
             Washington will be granted options to purchase New Common
                 Shares (the "Washington Stock Options"). The Washington Stock
            Options will consist of three (3) tranches of options as
follows:                                    

                  a.       The "Tranche A Washington Options" will be options to
                           purchase New Common Shares consisting of five percent
                           (5%) of the New Common Shares outstanding, on a fully
                  diluted basis, with a per share strike price
                       calculated based upon an assumed total enterprise
                       value for Reorganized WGI and its subsidiaries of
                          $300 million MINUS "Funded Debt" (as defined below).
                       The Tranche A Washington Options will have a term
                    expiring on the fifth (5th) anniversary of the
Effective Date.           

                  b.       The "Tranche B Washington Options" will be options to
                           purchase New Common Shares consisting of five percent
                           (5%) of the New Common Shares outstanding, on a fully
                  diluted basis, with a per share strike price
                        calculated based upon a total enterprise value for
                          Reorganized WGI and its subsidiaries of $550 million
                         MINUS Funded Debt. The Tranche B Washington Options
                  will have a term expiring on the fifth (5th)
        anniversary of the Effective Date.

                  c.       The "Tranche C Washington Options" will be options to
                           purchase New Common Shares consisting of five percent
                           (5%) of the New Common Shares outstanding, on a fully
                  diluted basis, with a per share strike price

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                       calculated based upon an assumed total enterprise
                       value for Reorganized WGI and its subsidiaries of
                   $720 million MINUS Funded Debt. The Tranche C
                         Washington Options will have a term expiring on the
                        seventh (7th) anniversary of the Effective Date. A
                    sample calculation of the strike price for the
                       Washington Stock Options is set forth on SCHEDULE
5.15(b) to the Plan.      

                  The Tranche A Washington Options, Tranche B Washington Options
                and Tranche C Washington Options will each vest in three (3)
                  equal installments on each of the Effective Date and the first
                  two (2) anniversaries of the Effective Date (if Mr. Washington
              is Chairman of the Board on such date); PROVIDED THAT, all
                such options will vest immediately upon Mr. Washington being
                 removed as Chairman of the Reorganized WGI Board of Directors
                  involuntarily, including through the failure to be renominated
to the Board.                               

                  For purposes of calculating the per share strike price for the
                 Washington Group Options, "Funded Debt" will be determined as
              of the Confirmation Date and includes the amount of funded
                  debt outstanding immediately after the Effective Date incurred
            to repay or retire outstanding obligations under the DIP
             Facility. Funded Debt shall be subject to adjustments, if
               necessary, to reflect a normalized level of working capital
          ("NLWC"). The NLWC will be determined by the financial
                advisors to the Debtors and the Prepetition Secured Lenders,
              and shall be set forth in the Confirmation Order. The NLWC
                 will be such working capital as would be normal and customary
         for the Debtors' businesses as they exist at the time
         consistent with industry standards, the Debtors' past
                 experience and benchmarking. The NLWC will be consistent with
             past practices and will neither accelerate nor defer cash
                receipts by, among other things, modifying billing cycles or
           the timing or terms of the collection of receivables or
                  dividends from joint ventures. The Debtors will continue their
           historical cash management procedures including issuing
          letters of credit for retainage on accounts receivable
                  collections. The NWLC will also adjust for any acceleration or
                 deferral of cash disbursements including, among other things,
                 modifying normal payment terms or timing of accounts payable,
            prepaying for services, pre-funding or deferring pension
                contributions or permitting substantial retainer payments or
               having cash balances higher or lower than customary. Funded
               debt and NLWC will be adjusted to exclude the impact of (A)
               the consolidation of previously unconsolidated investments,
             (B) acquisitions or dispositions of assets for fair value
                 outside the normal course of business, (C) other transactions
                  which would not be expected to modify enterprise value and (D)
               acquisition or disposition of fixed or other assets outside
the ordinary course of business.            

       2.       EARLY VESTING OF WASHINGTON STOCK OPTIONS - If, prior to the
                Effective Date, the Debtors enter into any agreement to sell
                 more than twenty-five (25%) of the value (based upon revenue)
                  of any business unit of the Debtors (excluding the Petroleum &
               Chemical business unit and the Mining division), (a) all of
                the Washington Stock Options will be issued and become fully
                 vested on the Effective Date, (b) the Debtors will accept Mr.
              Washington's resignation from the Board of WGI and (c) the
              Debtors shall not utilize the Washington name or trademark
              after the Effective Date (following a reasonable period of
transition).                                

  3.       PAYMENT UPON SALE OF ASSETS - If, prior to or as of the
                Effective Date (whether pursuant to a plan or reorganization
                or otherwise) substantially all of the assets of the Debtors
                are sold, Mr. Washington will receive a payment, in cash, in
                an amount equal to (i) the amount by which the aggregate net
               proceeds from such asset sales (including an adjustment for
                  liabilities assumed, if any, in excess of the NWLC) (the "Sale
               Proceeds") exceed $300 million multiplied by .05, plus (ii)
             the amount by which the Sale Proceeds exceed $550 million
              multiplied by .05, plus (iii) the amount by which the Sale
            Proceeds exceed $720 million multiplied by .05. A sample
            calculation is attached as Schedule 5.15(b) to the Plan.

        4.       VALUATION OF WASHINGTON STOCK OPTIONS - Lazard has valued the
                Washington Stock Options, based on a Black-Scholes analysis,
           to be between $ 35 million and $40 million. Neither the
           Creditors' Committee nor other parties in interest have
                 reviewed such valuation and reserve their rights to object to
such valuation.                             

      5.       BOARD, MANAGEMENT AND RELATED MATTERS - Mr. Washington will
                  remain as Chairman of the Board of Directors of WGI. The Board
                 of Directors of Reorganized WGI will be comprised of nine (9)
              directors. Mr. Washington will be Chairman of the Board of
                  Directors of Reorganized WGI without compensation for at least
                two (2) years after the Effective Date so long as desired by
                  the Board. Mr. Hanks and Mr. Batchelder will also be appointed
               to the Board of Directors of Reorganized WGI. The remaining
                 six (6) directors will be selected by the Prepetition Secured
             Lenders. SEE SECTION VI.J.1. In addition, pursuant to the
                Washington Agreement, the Plan provides for the continuation
                 of benefit arrangements for Mr. Washington in existence as of
                  the Petition Date, such as expense reimbursement practices and
ongoing indemnification rights.             

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   6.       PARTICIPATION IN THE DIP FACILITY - Under the Washington
               Agreement, Mr. Washington became a DIP Lender under the DIP
               Facility with a commitment of $10 million. As a DIP Lender,
               Mr. Washington participates in the DIP Facility on the same
                 terms as all other DIP Lenders; PROVIDED THAT, Mr. Washington
            does not participate on lender calls and may not vote on
matters requiring 100% DIP Lender approval. 

        7.       PERMITTED ACCUMULATION OF ADDITIONAL EQUITY - Pursuant to the
                  Washington Agreement, the Articles of Incorporation and Bylaws
                  of Reorganized WGI will be amended to permit Mr. Washington to
                acquire (directly or indirectly) up to 40% of the New Common
             Stock outstanding, on a fully diluted basis, assuming the
               exercise of the Washington Group Stock Options. SEE SECTION
VI.E.3.                                     

                  The Creditors' Committee and certain other parties in interest
have asserted that the Plan violates the absolute priority rule of section      
1129(b)(2)(B)(ii) of the Bankruptcy Code and two Supreme Court decisions        
because, if Class 7 votes against the Plan, under the Washington Agreement, Mr. 
Washington will receive despite the rejection of Class 7, a distribution of     
options to acquire New Common Shares and other benefits. The Debtors and the    
Prepetition Secured Lenders dispute this assertion and assert that the          
consideration to be provided to Mr. Washington is being provided solely in      
connection for future services to be rendered, and that he is not receiving or  
retaining any property under the Plan on account of his Old Common Stock, and   
that as a result, neither the absolute priority rule nor any Supreme Court      
decision is violated by the Plan whether or not Class 7 votes against the Plan. 

H.       SUMMARY OF CLAIMS PROCESS AND BAR DATE                                 

1.       SCHEDULES AND STATEMENTS OF FINANCIAL AFFAIRS        

             The Debtors filed Schedules of Assets and Liabilities and
Statements of Financial Affairs (collectively, the "Schedules and Statements")  
with the Bankruptcy Court on June 29, 2001. Among other things, the Schedules   
and Statements set forth the Claims of known creditors against the Debtors as of
the Petition Date, based upon the Debtors' books and records. The Schedules and 
Statements are consolidated for all Debtors, as authorized by order of the      
Bankruptcy Court.                                                               

2.       CLAIMS BAR DATE AND PROOFS OF CLAIM                  

         On June 15, 2001, the Debtors filed a motion with the
Bankruptcy Court to establish the general deadline for filing proofs of claim   
against the Debtors by those creditors required to do so (the "Bar Date"). On   
June 21, 2001 the Bankruptcy Court established the Bar Date as August 27, 2001. 
The Bankruptcy Court's order establishing the Bar Date (the "Bar Date Order")   
requires that the Debtors' Claims Agent provide notice of the Bar Date by       
mailing: (i) a notice of Bar Date; (ii) a proof of claim form; and (iii) a      
notice of either unliquidated, contingent and/or disputed claim or liquidated,  
non-contingent and undisputed claim upon the requisite persons or entities. The 
Bar Date and the Debtors' completion of their preliminary review of all Claims  
filed is anticipated to be completed after the Confirmation Date.               

               Based upon a review of their books and records, the Debtors
believe that the aggregate amount of Claims classified in Class 7 that will     
become Allowed Claims is in the range of $650 million to $1.1 billion. These    
Claims include (a) approximately $313 million of Claims under the Old Notes, (b)
the Lender Deficiency Claims and (c) Claims arising primarily out of pending    
litigation and other contingent and/or disputed Claims in amounts estimated to  
be between $250 to $700 million. While the Debtors have endeavored to estimate  
the amount of Claims that will ultimately be Allowed in Class 7 based upon      
evaluations of such Claims and historical results of litigation and settlements,
many such Claims are contingent, unliquidated and/or disputed and thus the      
amount that will ultimately be Allowed with respect to such Claims is highly    
speculative. Moreover, the Bar Date has not yet occurred, and thus the Debtors  
cannot know the amount of Claims that will ultimately be filed by creditors.    

                Under section 502(b)(9) of the Bankruptcy Code, governmental
units have until 180 days after the commencement of a case to file proofs of    
claim. Accordingly, the Bar Date for governmental units in these Chapter 11     
Cases is November 12, 2001. That date has not yet occurred and thus the Debtors 
cannot know the amount of Claims that will be ultimately filed by governmental  
units. Certain governmental units have indicated that they intend to file Claims
in excess of $200 million, which the Debtors may dispute in whole or in part.   

       Finally, Raytheon has indicated that it will assert
substantial Claims, which, to the extent Allowed and not subordinated, will be  
classified as Class 7. SEE SECTION VI.C.4 and APPENDIX D. While the Debtors     
intend to dispute the allowance of any Claims asserted by Raytheon on many      
grounds, including that the incurrence by the Debtors of indemnity obligations  
to Raytheon was a fraudulent transfer that is avoidable under applicable        
sections of the Bankruptcy Code, there can be no assurance that such efforts    
will be successful.                                                             

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The Debtors' estimate of the amount of Claims in Class 7 does not include any   
Claims asserted by Raytheon. SEE SECTION V.I.1.                                 

I.       SUMMARY OF MATERIAL LITIGATION MATTERS                                 

                 During the Chapter 11 Cases to date, the Debtors commenced or
were involved in a number of lawsuits. In addition, the Debtors are             
investigating other potential causes of action arising out of transactions      
involving Raytheon and other third parties.                                     

1.       CLAIMS AGAINST RAYTHEON                              

              On March 8, 2001, WGI filed suit against Raytheon and RECI
alleging fraud and seeking rescission and, alternatively, unspecified damages   
and specific performance for breach of the Stock Purchase Agreement in the Idaho
Court. For a description of the Raytheon transaction and its effects upon the   
Debtors, see SECTION III.A and SECTION IV.A. The Debtors believe Raytheon       
suppressed information that would lead a potential purchaser to discern the     
magnitude of the significant adverse problems facing the RE&C Businesses. During
the course of negotiations and due diligence, Raytheon presented historical     
data, audited and unaudited financial statements, and projections that portrayed
a healthy company with strong earnings potential going forward.                 

            The Debtors believe that the Company's due diligence was
hampered by Raytheon's deliberate withholding of what later turned out to be    
material information by Raytheon limiting WGI's access to selected individuals, 
who Raytheon knew were not the key individuals, and by Raytheon permitting site 
visits to only a limited number of projects. Due diligence was further hampered 
by Raytheon's intentional misrepresentations about material facts with respect  
to projects, as well as the company's historical financial statements and       
financial projections. The Debtors believe that, throughout the period of due   
diligence, and, in fact, through the closing of the transaction, Raytheon       
continued to misrepresent the accuracy of the forecasted EBITDA potential of the
RE&C Businesses by, among other things (i) refusing to permit the RECI          
Subsidiaries' project management to recognize material, known, cost growth on   
projects (thereby retaining false profit or low loss forecasts); (ii) violating 
Generally Accepted Accounting Principles by inflating revenue through           
unrealistic assumptions regarding expected claims recovery, which expectations  
were not achievable and which quickly had to be reversed by WGI; (iii)          
increasing EBITDA by assuming unrealistic expense reductions (e.g., removing    
training, facility and salary costs) which were vital to an on-going sustainable
business; and (iv) by failing to take into account overhead under absorption    
rates in several facilities, all the while representing to WGI that projected   
EBITDA from ongoing RE&C Businesses' operations would be at least $140 million  
annually. Additionally, Raytheon justified limiting due diligence by            
representing that any discrepancies in the valuation of assets would be cured   
post-closing by virtue of a purchase price adjustment provision that was        
included in the Stock Purchase Agreement.                                       

                  As a result of its continuing post-acquisition in-depth review
of the RE&C Businesses assets acquired, the Debtors believe that Raytheon       
management consistently engaged in inappropriate accounting practices and       
intentional earnings manipulation by overstating revenue, understating costs,   
avoiding recognition of losses and thereby severely overstating profits and     
understating losses on numerous projects.                                       

           WGI's suit sought a preliminary injunction and specific
performance of the purchase price adjustment provision of the Stock Purchase    
Agreement, as well as unspecified damages or recision as a result of alleged    
fraud. Raytheon moved to dismiss the suit (the "Motion to Dismiss") or, in the  
alternative, stay the suit in lieu of an arbitration proceeding that it had     
previously commenced. The Idaho Court denied the Motion to Dismiss, but stayed  
that portion of WGI's complaint relating to the fraud allegations. The Idaho    
Court allowed WGI's causes of action relating to specific performance to        
proceed, however, and hearings were held on May 2nd and 3rd, 2001 on WGI's      
specific performance claims. The Idaho Court ruled in favor of WGI and issued a 
mandatory injunction ordering Raytheon to produce those documents required to   
start the purchase price adjustment process. By Order dated June 1, 2001, the   
Idaho Court further ordered that Raytheon produce an audited and/or unaudited   
balance sheet and other related documents required under the Stock Purchase     
Agreement by June 5, 2001 and appointed William Palmer & Associates as an       
independent accounting firm to assist in resolving disputes in the purchase     
price adjustment process. Raytheon produced an unaudited April 30, 2000 balance 
sheet and a cut-off date balance sheet on June 5, 2001. WGI responded to those  
documents on June 29, 2001. WGI and Raytheon are required to present materials  
to the independent accountant supportive of their respective positions on or    
before July 30, 2001.                                                           

             On or before August 3, 2001, the Debtors will commence an
Adversary Proceeding against Raytheon and its subsidiaries in the Bankruptcy    
Court under applicable sections of the Bankruptcy Code, seeking to, among other 
things, recover transfers and avoid obligations that the Debtors believe        
constitute fraudulent transfers. The Adversary Proceeding is expected to allege,
among other things, that Raytheon was the transferee or beneficiary of numerous 
transfers that are avoidable under sections 544, 547, 548 and 550 of the        
Bankruptcy Code. That Adversary Proceeding will also seek to avoid as a         
fraudulent transfer the incurrence of any obligations to Raytheon under the     
Stock Purchase Agreement or related documents, such as indemnity obligations    
asserted by Raytheon. The Debtors believe that these claims have substantial    
merit and will be asserted in amounts aggregating hundreds of millions of       
dollars. The Debtors expect                                                     

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Raytheon to dispute all asserted claims against it, to assert hundreds of       
millions of dollars in claims against the Debtors, and to take the position that
it is entitled to vote on the Plan as a Class 7 creditor. SEE APPENDIX D for a  
statement of position by Raytheon.                                              

               Section 502(d) of the Bankruptcy Code provides, among other
things, that any claims of an entity (a) from which property is recoverable     
under section 550, or (b) that is a transferee of a recoverable transfer, shall 
be disallowed. Accordingly, the Debtors believe and intend to take the position 
that (i) any claims that might be asserted by Raytheon or its subsidiaries      
against the Debtors must be disallowed unless and until Raytheon and its        
subsidiaries pay the amounts for which the Debtors assert they are liable on    
account of, among other things, fraudulent transfers, and (ii) Raytheon and its 
subsidiaries are not entitled to vote on the Plan on account of any such claims 
they might assert against the Debtors. The Bankruptcy Court has set a hearing to
estimate Raytheon's alleged Claims for voting purposes only, for August 28,     
2001, in accordance with Bankruptcy Rule 3018. There can be no assurance as to  
the amount of claims (if any), the Bankruptcy Court will allow Raytheon for     
voting purposes.                                                                

             As described in SECTION VII.B, all Company claims against
Raytheon and its subsidiaries, including those described above, will be         
transferred to the WGI Creditor Trust, which will be funded with $20 million to 
pursue such claims.                                                             

2.       MITSUBISHI LITIGATION                                

                 On May 14, 2001, the day the Debtors commenced the Chapter 11
Cases, Mitsubishi filed an ex parte motion (the "Prohibition Motion") under     
section 363(e) of the Bankruptcy Code, together with supporting memorandum,     
affidavits, and discovery materials, with the Bankruptcy Court to prohibit the  
Debtors' use of $191,230,825 paid to the Debtors by Sithe relating to two power 
plant projects in Massachusetts. On the Petition Date, the Debtors' cash on hand
was approximately $11 million.                                                  

                 Mitsubishi, a member of the Creditors' Committee, is a vendor
that sold equipment to the Debtors in connection with the Sithe projects        
pursuant to agreements signed by RE&C and later assumed by WGI. Mitsubishi      
asserts a substantial claim for the unpaid balance owed for the equipment.      

           In the Prohibition Motion, Mitsubishi sought to collect
payment on its claim by impressing current and future cash of the Debtors with a
trust arising under New York lien law, agency law, the doctrine of earmarking,  
and constructive trust theories. Mitsubishi also sought an accounting of funds  
received from the Sithe projects and adequate protection of its interests in the
Sithe payments. Pending final resolution of this litigation, the Debtors agreed 
to maintain minimum cash balances of approximately $11 million.                 

                  Payment of the Mitsubishi's claim has been fully guaranteed by
Raytheon pursuant to guarantees executed at the inception of the Sithe projects.
Indeed, the Debtors believe that approximately $135 million has already been    
paid to Mitsubishi and substantially all of the balance is anticipated to be    
paid in the near future.                                                        

                 The Debtors contested the validity of Mitsubishi's claims, as
set forth in detail in the pleadings filed by the Debtors in the Chapter 11     
Cases, on numerous legal and factual grounds. On June 13, 2001, the Bankruptcy  
Court denied the Prohibition Motion and related requests by Mitsubishi in their 
entirety. On June 20, 2001, Mitsubishi filed a notice of appeal regarding the   
Bankruptcy Court's decision, which appeal is pending. Mitsubishi also applied to
the district court for a stay of Judge Zive's ruling pending appeal. Washington 
opposed the application but agreed to maintain minimum cash balances of         
approximately $11 million through July 31, 2001 to allow time for the district  
court to rule on Mitsubishi's application. Mitsubishi's application for a stay  
pending appeal was granted by the district court on July 19, 2001.              

           Mitsubishi has also asserted that it has certain claims
against certain of the Debtors' officers and directors as a result of the       
dissipation of such trust funds. The Debtors dispute that Mitsubishi has any    
valid claims against any officer or director, but no officer or director is     
receiving a discharge or release of any non-derivative, direct creditor claim   
under the Plan. SEE SECTION VI.H. Officers and directors' rights to be          
indemnified be the Debtors, are being assumed under the Plan and thus if the    
Plan is confirmed will be obligations of the Reorganized Debtors. SEE SECTIONS  
VI.H AND VI.J.4.                                                                

J.       FOREIGN ACTIONS                                                        

                 On May 29, 2001, Washington International B.V., a Netherlands
company and indirect wholly owned subsidiary of WGI, which is not a Debtor in   
these Chapter 11 Cases, was granted a provisional suspension of payment by the  
District Court of s-Gravenhage, the Netherlands, which provisional suspension of
payment imposes a moratorium on non-preferential and unsecured creditors' claims
as of the date of the suspension. This entity will be liquidated during 2001.   
The Debtors do not believe that this has had or will have a material impact on  
the Debtors or the Reorganized Debtors.                                         

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K.       MOTION OF THE CREDITORS' COMMITTEE TO TERMINATE THE DEBTORS' EXCLUSIVE 
PERIOD TO FILE AND SOLICIT ACCEPTANCES OF THE PLAN                              

               On July 5, 2001, the Creditors' Committee filed a motion to
terminate the Debtors' exclusive period under section 1121(b) of the Bankruptcy 
Code to file a reorganization plan and to obtain its acceptance (the            
"Exclusivity Motion"). The Creditors' Committee has asserted a number of grounds
in support of the Exclusivity Motion, each of which is contested by the Debtors.
The Debtors do not believe that there are sufficient grounds to terminate their 
exclusive periods to file and solicit acceptances of the Plan. The Bankruptcy   
Court conducted a hearing on the Exclusivity Motion and the Debtors' objection  
thereto on July 24, 2001. The Exclusivity Motion was continued by agreement     
until September 6, 2001. If the Exclusivity Motion is granted, other parties in 
interest, including the Creditors' Committee, would have the right to file      
competing reorganization plans.                                                 

L.       DEVELOPMENT AND SUMMARY OF THE BUSINESS PLAN                           

               With the assistance of their financial advisors, investment
bankers and legal counsel, the Debtors have developed a long-term Business      
Plan. A summary of the principal components of the Business Plan, and a         
description of the principal assumptions underlying the Business Plan, is set   
forth below.                                                                    

              Attached to the Disclosure Statement as Appendix C are the
Projections for the Debtors on a consolidated basis through fiscal 2004, based  
upon the Business Plan. These projections have not been reviewed nor commented  
on by the Creditors' Committee and other parties in interest.                   

1.       SUMMARY OF THE BUSINESS PLAN                         

               Reorganized WGI will continue to be a leading international
provider of design, engineering, construction, construction management,         
facilities and operations management, environmental remediation and mining      
services to the world's largest manufacturers, power companies and utilities and
industrial companies. Reorganized WGI will have four operating divisions:       

                 POWER (Princeton, NJ) - will provide design, new construction
             and plant retrofit services to domestic and international
       power generating customers, including utilities and
independent power producers.                

                  INFRASTRUCTURE & MINING (Boise, ID) - will provide heavy civil
               engineering services and serves as a general contractor for
           infrastructure projects in the transportation (bridges,
                 highways, mass transit), marine and air (ports and terminals)
              and water resources (reservoirs, hydroelectric, pipelines)
markets.                                    

              GOVERNMENT (Aiken, SC)- will provide technical services to
                United States Department of Energy ("DOE") and United States
                  Department of Defense ("DOD"), such as environmental clean-up,
                  chemical demilitarization and nuclear fuel reprocessing. These
             services include the design, construction, management and
           operation, dismantling, decommission ing and closure of
government facilities.                      

     INDUSTRIAL/PROCESS (Cleveland, OH) - will provide
                 design/engineering, procurement and construction services, in
                addition to consulting services, to Fortune 500 companies in
                 the general manufacturing, food and beverage, pharmaceutical,
             technology, pulp and paper and other markets. The current
       Petroleum & Chemicals group will be merged with the
Industrial/Process group.                   

                 The Business Plan contemplates a number of strategic actions,
the most significant of which are:                                              

                 o        Fully integrating Old MK, the Westinghouse Group and
                         the RE&C Businesses into the four divisions, Power,
                           Infrastructure, Government and Industrial/Process, to
              maximize business development, improving
                   profitability and maintaining a positive work
                       environment for the employees of Reorganized WGI.

              o        Concentrating the Company's efforts on the higher
                           profit, higher profile projects that will provide the
               most value to the Company's stakeholders.

             o        Focusing on developing the business across North
                         America with select pursuit of global opportunities
                           during the short term and expanding Reorganized WGI's
         global presence over the long term.

                 o        Restructuring the business groups to be organized by
                   function (market/industry/client) rather than
geographic                

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location.                 

                o        Creating a disciplined and profit oriented business
                         mindset driven by a professional sales organization
                 with the ability to provide project finance
                      capability where needed and ultimately expanding
                          project financing capability to program development.

                o        Revamping information technology ("IT") systems and
                     process in order to affect savings and generate
online data.              

           o        Changing cost structure to realize significant
overhead savings.         

              o        Consolidating or closing overlapping/unprofitable
                          offices and expanding the focus on client reimbursed
                     outlying project offices. In addition, reducing
                    annual real estate costs of $60 million to $40
million.                  

            o        Establishing operation centers in the Northeast
                   Corridor, the Midwest and the West for shared
                   services (i.e. Finance, Administration, Human
                      Resources, Legal and IT) and common engineering,
               procurement and cost scheduling services.

                 WGI management believes that Reorganized WGI will emerge from
chapter 11 with significant opportunities for growth in each of its four        
divisions. The growth opportunities for each of the four divisions of           
Reorganized WGI, together with the strategic initiatives contemplated by        
Reorganized WGI to realize such growth opportunities, are summarized below.     

a.       POWER                              

                         (i)      Growth Opportunities - The Debtors believe
                               that the power group ("Power") has many
                                   opportunities for growth as a result of the
  following:

                                ANTICIPATED ENERGY SHORTAGE - Currently,
                                  demand for electricity outpaces the growth
                               in supply. Management believes that the
                              global market for Power's construction
                                  services could exceed $30 billion by 2010.
                                 Power provides a platform for Reorganized
                                   WGI to take advantage of the most favorable
                    power market in two decades.

                                STRENGTHENING OF SERVICES INDUSTRY - The
                                    recent mergers and acquisitions activity and
                             the divestitures of utility assets to
                                   private power generators will bring about a
                                    wave of outsourcing possibilities for Power.
                                   Alliances are key to the outsourcing market
                                for nuclear services, integrated design,
                              maintenance and component replacement.
                                 Additionally, Power is one of two primary
                       contractors for steam generator
                                    replacements, an expanding market due to the
                              rise in nuclear plant life extensions.

                                    POWER'S EXTENSIVE, INTEGRATED CAPABILITIES -
                                   Power offers an extensive, integrated array
                            of services in all stages of a power
                                  project, including design and engineering,
                                construction, operation and maintenance,
                                  closure and decommissioning. The appeal of
                                  one-stop shopping also helps Power develop
                               long-term relationships with customers.
                                  Power's full-service approach allows it to
                                   bid for and complete the most complex jobs.
                                 Power's large technical base of engineers
                                    provides instant capability for the largest,
                                most complex projects and an engineering
                           capacity few competitors can match.
                               Additionally, Power is well situated to
                                  benefit as more project owners turn to the
                            design-build and turnkey concepts of
                                  developing projects to improve the quality
                             of execution, speed of delivery, cost
                                   effectiveness and enhancement of contractor
       accountability.

                                 MARKET REPUTATION - As the fourth largest
                                    engineering, construction and operations and
                                  maintenance company in the power business,
                            Power is uniquely positioned to take
                                    advantage of the recent upswing in the power
                                  market. Power maintains its leading market
                               position by forging strong customer and
                                  partner alliances, by maintaining low cost
                                  engineering centers in Europe and Asia and
                                by having readily deployable experienced
                        turnkey project execution teams.

                          SHIFT IN THE MARKETPLACE - As U.S.
                                  developers combine with owners of licensed
                                   project sites, Power has the opportunity to
                                   build a profitable backlog of new work very
                          rapidly. With contractor resources

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                                in the U.S. near capacity, opportunities
                             exist for negotiated contracts due to
                                limited competition, multiple orders and
                                  increased margins. These opportunities are
                             less risky than the lump sum, turnkey
                       projects that have historically
                   characterized the industry.

                          POTENTIAL NEW PROJECTS - Power has
                                    substantial new project opportunities. Those
                                 opportunities highlight the importance of
                                    Power's technical expertise and full-service
                                    capabilities. Realization of the new project
                                 opportunities will effectuate the revenue
                               growth projected by Power over the 2002
    fiscal year.

                         (ii)     Strategic Initiatives - Due to marketplace
                               shifts, the power industry has become a
                              seller's market. In a seller's market,
                         projects are awarded based upon a
                              contractor's record of performance and
                                 experience level. Power is poised to take
                                 advantage of this market dynamic and will
                          pursue projects with the following
                          characteristics: cost-reimbursable
                            contracts, target/incentive pricing,
                                  "damages" limited to profit impact, and no
                           guarantee of equipment performance.

                                Additionally, Power is focusing on doing
                              more work on a joint venture basis. By
                              aligning with the proper joint venture
                               partner, access to the bonding capacity
                           becomes easier. Power will focus on
                                  developing partnerships/alliances with key
                              customers to design and build multiple
 projects.

                                   Power's management is dedicated to reducing
                            costs within the group. Cost cutting
                                   measures currently underway are expected to
                                   reduce general overhead costs from a fiscal
                                    2000 level of $47 million to a projected run
                            rate beginning in fiscal 2002 of $27
million.

b.       INFRASTRUCTURE AND MINING          

                         (i)      Growth Opportunities - The Debtors believe
                                 that Infrastructure and Mining ("I&M") is
                                   well positioned in the long term because it
                                   offers clients the most comprehensive range
                              of services available in the business,
                          including project conception, cost
                          estimation, design/engineering and
                               construction, as well as operations and
                                  maintenance. Opportunities for the segment
                          are being driven by the following:

                                  TRANSPORTATION EQUITY ACT ("TEA") - In the
                                highway market, the Company's management
                                    forecasts that industry fundamentals will be
                                aided by the recently enacted TEA and is
                                 projecting growth of 8% annually. In this
                                  market, I&M has begun to focus itself more
                                   on design-build "mega" projects and less on
                         smaller, highly competitive basic
                                  construction projects where small regional
                          contractors can undercut I&M bids.

                                 AIRPORT EXPANSION - The airport market is
                                  another strategic focus for I&M, primarily
                                due to the tremendous need for increased
                                 capacity. With the introduction of recent
                                    legislation, management expects this segment
                                  to grow at a rate of 10% annually. In this
                             market, providing a full continuum of
                          services (design, construction and
                                 operations and maintenance) distinguishes
                 I&M from its competition.

                                 RAIL AND TRANSIT UPGRADES AND EXPANSION -
                                    The rail and transit market is also expected
                                    to grow at 8% in the coming years and offers
                           strong opportunities for design and
                             construction as well as operation and
                               maintenance ("O&M") services. Moreover,
                                 there are few competitors who can provide
                                 the necessary services needed to complete
                              the major projects without partnering.

                                    DEMAND FOR CONTRACT MINING SERVICES - Demand
                                 for contract mining services is currently
                                 being driven by rising coal prices. I&M's
                                 position is enhanced in this arena due to
                                its ability to provide "cradle-to-grave"
                               services that few other competitors can
offer.  

                         (ii)     Strategic Initiatives - I&M is planning to
                                take advantage of its ability to provide
                             total project capabilities, including
                                    project development, financing, design-build
                            and comprehensive service package by
                        competing for high margin "mega"
                             infrastructure projects. These "mega"
                                   projects, defined as having contract values
                                in excess of $100 million, are generally
                              unavailable to smaller engineering and
                             construction firms that are unable to
                                    provide comprehensive capabilities. I&M will
      systematically

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                          reduce its emphasis on stand-alone
                                    construction and design services, refocusing
                           these resources on more profitable,
                               design-build projects. I&M will use its
                                    project presence in the Pacific Rim, Europe,
                       and South America to expand its
                                international opportunity base for large
 projects.

                                  Additionally, I&M is focusing on strategic
                                   joint ventures. By aligning with the proper
                                   joint venture partner, I&M will continue to
                                  be able to compete for a wide selection of
                                  the "mega" projects. Aligning with a joint
                            venture partner allows for access to
                                   selected market niches and bonding required
                        on most infrastructure projects.

c.       GOVERNMENT                         

                         (i)      Growth Opportunities - The Debtors believe
                                that the Government group ("Government")
                                  should benefit from its strong position in
                                the marketplace and several factors that
                                will provide Government with significant
                            opportunities to grow. These factors
include:

                                   INCREASING DOE BUDGET - Over the last three
                                    years, DOE budgets have grown by $1 billion.
                                    Trends in the DOE market are being driven by
                              the need to replace the aging domestic
                         infrastructure; national security
                          enhancements; hazardous facilities
                             operations (particularly at the DOE's
                                 national laboratories); integrated safety
                                  management improvements; and management of
                                   nonproliferation programs for materials and
                              weapons of mass destruction (driven by
                          international political pressure).

                           GLOBAL DEMILITARIZATION -The Global
                            Demilitarization market is expecting
                         significant funding increases for
                                demilitarization and countering nuclear,
                              biological and chemical ("NBC") weapon
                             threats. Approximately $11 billion of
                                   anti-terrorism funding will create the need
                              for NBC knowledge, weapon effects, and
                                    emergency planning consulting. Additionally,
                                    global plutonium disposition treaties create
                                   several opportunities for Government, given
                       its unique plutonium expertise.

                                   Government currently commands 70 percent of
                             the chemical demilitarization market.
                               Government manages four of six chemical
                                   demilitarization sites for the U.S. Army as
                             well as a site in the Ukraine that is
                                    managed through a joint venture. This market
                              is projected to continue to be strong,
                                  especially on the international front. Key
                                 prospects are the demilitarization of the
                                    former Soviet Union and the cleanup of World
                              War II vintage chemical weapons in the
                                Peoples' Republic of China. Government's
                                   excellent track record, technical expertise
                                and geographic reach position it well to
                          capture new business in unexploded
            ordinance/de-mining.

                               RETIREMENT OF AGING NUCLEAR PLANTS -The
                                Energy Information Agency estimates that
                                approximately 40% of currently operating
                                 nuclear capacity will be retired by 2020.
                            This phenomenon creates a tremendous
                   opportunity for Government.

                           (ii)     Strategic Initiatives - Government functions
                            in all stages of the life cycle of a
                          facility, including the design and
                                engineering, construction, operation and
                                 maintenance, closure and decommissioning.
                                   Government is planning to take advantage of
                                its ability to provide a broader service
                               offering than any of its competitors by
                          pursuing projects that many of its
                                  competitors cannot perform. These projects
                               include managing complex facilities and
                                  working with dangerous materials in public
arenas. 

                                    Government will also exploit the opportunity
                                  develop and expand its commercial business
                                    division. The commercial business segment of
                           the industry has substantial growth
                                   potential. Government intends to expand its
                              relationship with the DOE and grow its
                            demilitarization and DOD businesses.
                                  Additionally, as part of the overall asset
                                  disposition plan to improve liquidity, the
                                    Company is planning to sell its share of its
                    electro-mechanical division.

                           Restructuring Government will yield
                                  approximately $6 million in reduced annual
                              overhead expenses. The savings will be
                                 generated primarily from reduction in the
                              geographic "footprint" of the unit and
                personnel restructuring.

                                    Government is currently located in 19 cities
                                 throughout the United States in 39 leased
  facilities

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                                   amounting to more than 500,000 square feet.
                                 The annual rental cost for such leases is
                                approximately $7 million. As part of the
                             restructuring process, the geographic
                                  "footprint" of Government will be reduced,
                                resulting in approximately $1 million in
                          annual savings in rental payments.

                          A review of the Government Group's
                                    organizational structure is in process in an
                                 effort to determine the required resource
                                load, and to exact efficiencies. Certain
                               headcount reduction initiatives will be
                                  commenced, including attrition management;
                               elimination of duplicate functions; and
                                   elimination of positions. It is anticipated
                              that this review will result in annual
                 savings of $2.75 million.

                           Restructuring will yield additional
                             administrative savings because of the
                                  reduced geographic "footprint" and through
                                optimizing the organizational structure.
                                   Those savings will total approximately $2.4
         million annually.

d.       INDUSTRIAL PROCESS                 

                    (i)      Growth Opportunities - The Industrial
                                  Process group ("I/P") is focused on adding
                            value for customers and becoming the
                               engineering/contractor of choice. I/P's
                                    growth opportunities focus on the following:

                              EXPANSION OF THE PORTFOLIO OF SERVICES
                            PROVIDED TO EXISTING CUSTOMERS - I/P
                                    currently provides only specific services to
                         their core customers. Significant
                                  opportunities exist to expand the services
                                    provided to its core customers. For example,
                                  a key growth market exists in the areas of
                                 operations and maintenance and facilities
                                   management. I/P has the unique advantage of
                               operating in both a union and non-union
                                  mode, and its broad geographic base allows
                                  it to serve clients worldwide. I/P intends
                                    to initiate a strong "cross-selling" program
             with its key clients.

                             CONTINUED EXCELLENCE AND EXPANSION IN
                               EXISTING CORE MARKETS - Core markets of
                                  biotechnology/pharmaceuticals, automotive,
                                  chemical process, food & beverage/consumer
                                    products, and pulp and paper account for 70%
         of sales for I/P.

                                  BIOTECHNOLOGY/PHARMACEUTICAL MARKET - This
                                  market has the strongest growth potential.
                                 All of the major customers in this market
                                  are multinationals, and to be a key player
                                in this market you must be able to serve
                                   customers in the United States, Puerto Rico
                            and Ireland. I/P is ideally situated
                                geographically to meet this demand, with
                           core pharmaceutical capabilities in
                            Philadelphia to cover the New Jersey
                           concentration of clients and strong
                              operating capabilities in Puerto Rico,
                        London and County Cork, Ireland.
                                   Additionally, I/P's strong Validation Group
                                   helps open doors with new clients. With 275
                                    employees and a 15% market share, I/P is the
                               leader in biotechnology/pharmaceuticals
            validation services.

                                 AUTOMOTIVE MARKET - Opportunities in this
                                  market will be fueled by technology driven
                                 projects and a continuous stream of plant
                                    modifications and upgrades as new models are
   introduced.

                                 CHEMICAL PROCESS MARKET - In this market,
                                   DuPont has been an I/P alliance partner for
                               over 15 years. In the Fall of 2000, I/P
                                  received its fifth consecutive "Governor's
                                    Safety Council Award" for outstanding safety
                                 performance at DuPont's Parkersburg, West
                                 Virginia plant site. I/P's overall safety
                                  record translates to lower labor insurance
                      (Workers' Compensation) costs.

                                    FOOD AND BEVERAGE/CONSUMER PRODUCTS MARKET -
                                  This is another core market for I/P. Major
                       customers in the market include
                            Anheuser-Busch, Kraft and Pillsbury.

                             PULP AND PAPER MARKET - With a strong
                              position in this market, I/P stands to
                                  benefit the most among its key competitors
                       as market fundamentals improve.

                                   FURTHER UTILIZATION OF THE CAPABILITIES AND
                                    RELATIONSHIPS ADDED BY RECENT ACQUISITIONS -
                                    The addition of Rust Constructors as part of
                                the acquisition of RE&C has given I/P an
                                immediate presence in the Southeast U.S.
                                    through its Birmingham, Alabama office. Rust
                     Constructors' non-union labor

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                         gives I/P "double-breasted" labor
                                    capabilities and allows customers to rely on
                                I/P's services regardless of a project's
                                locality and specific laws. This creates
                                 opportunities for I/P as existing clients
                              relocate or expand to the Southeast (a
                                   traditionally non-union labor market) where
                                   I/P has historically been unable to compete
     for projects.

                             NATURAL GAS PROCESSING - Based on the
                                    projected increase in consumption of natural
                                    gas over the next decade, I/P should be able
                              to exploit its strong position in this
market. 

               (ii)     Strategic Initiatives - I/P is a
                                 relationship-oriented business based upon
                                    long-term alliances and partnerships. I/P is
                        a service-oriented business with
                        design/engineering, procurement,
                                 construction management, quality programs
                         (testing), construction, facility
                                   management, O&M and validation performed on
                     a cost-plus, risk-free basis.

                                    I/P plans on taking advantage of its breadth
                                    of services by providing "one-stop shopping"
                                 for its customers. This will allow I/P to
                              build and expand on long-term customer
                                 relationships which forms the core of its
                                    business - 75% of I/P's revenues are derived
                                from repeat customers. I/P also plans on
                          differentiating itself through its
                                    "double-breasted" labor capability, mobility
                                 and expertise of its workforce and strong
                  track record of execution.

                                 Currently, I/P's mix of work is split 85%
                                   domestic and 15% international (outside the
                                    continental U.S.). Domestically, I/P now has
                                    a very strong presence in the Southeast U.S.
                             due to Rust Contractors. I/P plans on
                                dominating the Southeast corridor of the
                               U.S. market by leveraging Rust's market
                                  strength. I/P's strategy for international
                                    work is to grow with its U.S. and U.K.-based
                                  clients who are expanding their operations
                      into other areas of the world.

                                    In terms of the integration of the Petroleum
                                  and Chemical division ("P/C") into I/P and
                                   as part of the overall asset disposition to
                                  improve WGI's liquidity, the Company plans
                            to sell the Cambridge, Massachusetts
                                  Technology Center. After that disposition,
                                    the remaining business of P/C will primarily
                                be a Denver-based natural gas processing
                            activity. The natural gas processing
                                   division will be folded into the I/P group.
                                 This will result in annual G&A savings of
                 approximately $7 million.

     e.       CAPITAL STRUCTURE / BONDING AVAILABILITY

            The Company has been and will continue to negotiate with
surety companies to provide surety bonds during and after the Chapter 11 Cases. 
In order to obtain surety credit on a "normalized" basis, the surety companies  
have indicated that they will take several factors into consideration. They have
indicated that they look at the following factors both alone and in conjunction 
with the status of the overall Company: (1) tangible net worth; (2) credit      
availability; (3) adequate working capital; (4) debt coverage; and (5) debt     
rating.                                                                         

              If the Company does not meet certain standards, the surety
companies may limit bonding, require collateralization with letters of credit to
support the issuance of new surety bonds, and charge higher than "normal"       
premiums.                                                                       

     Historically, the Company's bonding need has been
approximately 10-15% of total revenue. Based on the projected revenue the       
Company estimates that it will need to obtain between $300-$500 million of      
surety bonds in 2002.                                                           

f.       EXIT FINANCING                     

                The Company intends to seek an Exit Facility consisting of a
revolver in the amount of approximately $350 million, but there can be no       
assurance that an Exit Facility in this amount will be obtained. The Debtors    
believe that the Plan is feasible within the meaning of section 1129 of the     
Bankruptcy Code even if a smaller Exit Facility is ultimately obtained. The Exit
Facility is anticipated to be utilized as follows:                              

                         (i)      Repay outstanding funded obligations under
                                  the DIP Facility and fund the WGI Creditor
                            Trust (projected to be $50 million).

                          (ii)     Replace or backstop all outstanding letters
                              of credit issued under the Prepetition
                              Credit Agreement (projected to be $125
                                    million at exit), all outstanding letters of
                            credit issued under the DIP Facility

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                                 (projected to be $44 million at exit), as
                           well as all future letter of credit
     requirements.

                  The balance of the Exit Facility is anticipated to be used to:

                   (i)      Fund an increase in working capital.

                         (ii)     Fund working capital fluctuations that may
                                   occur due to timing differences in receipts
          and disbursements.

       (iii)    Provide excess capacity.

           As discussed in SECTION V.C.3, the Debtors have not yet
received any commitment for an Exit Facility, but have commenced discussions    
with the DIP Lenders, the Prepetition Secured Lenders, and other financial      
institutions.                                                                   

1.       FINANCIAL HIGHLIGHTS                                 

             The Projections were prepared by year for the period from
December 1, 2001 through November 30, 2004. Each group (Power, Infrastructure   
and Mining, Government and Industrial Process) prepared their own projected     
balance sheets, income statements and schedules of receipts and disbursements.  
The schedules of receipts and disbursements consist of each group's significant 
current projects. The Company's corporate finance team consolidated each group's
projected balance sheets, income statements and schedules of receipts and       
disbursements and prepared a statement of cash flows for each group and a       
consolidated statement of cash flows. The following are highlights from the     
Projections:                                                                    

              Total revenue is expected to decline in the amount of $500
million from fiscal 2001 to 2002 due, in part, to the following:                

                  a.       Power's projected revenue is expected to decline $112
                   million due to the rejection/reformation of 4
                       contracts acquired through the acquisition of the
                       RE&C Businesses and the inability to win new work
      during the period of bankruptcy.

                  b.       Government's projected revenue is expected to decline
                          by approximately $290 million due to the sale of the
                          electro-mechanical division during the first quarter
                           of fiscal 2002 and the completion of the construction
                         phase of the projects at Umatilla and Anniston, and
                     the reduced activity at Weldon Spring and RMRS.

              c.       I/P's projected revenue is expected to decline by
                      approximately $95 million due to the sale of the
                      petroleum and chemical technology center and the
                           impact of bankruptcy proceedings on the petroleum and
                          chemical business in Europe. Additionally I/P does a
                          significant amount of business with companies in the
                        telecom industry, specifically Lucent and Corning,
                         who have delayed and or cancelled certain projects.

Total revenue is expected to increase by $65 million from fiscal 2002 to 2003.  

                 a.       Power's projected revenue is expected to increase by
                      approximately $114 million due to its success in
                         booking new work, specifically its ability to win 2
                          "mega" projects (>$250 million) in 2002 and 4 "mega"
                       projects in 2003, as Power is able to reestablish
                         itself in the marketplace. The increase is also due
                       to the continued strong market conditions and the
                      lack of excess capacity within the power sector.

             b.       Infrastructure and Mining's projected revenue is
                         expected to decline $84 million due to the expected
                    inability of Infrastructure and Mining to book
                   sufficient new work during and just after the
                          bankruptcy in order to maintain an adequate backlog.
                         Typically, large Infrastructure and Mining projects
                          require lead times of 6-9 months. Infrastructure and
                        Mining revenue is not expected to be significantly
                         affected during fiscal 2002, as they complete their
existing backlog.         

                  c.       I/P's projected revenues are expected to increase $68
                           million as I/P is expected to be able to re-establish
                        itself in the marketplace and continue to grow its
              presence in the pharmaceutical industry.

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                  d.       Government's projected revenue is expected to decline
                        approximately $34 million due to the completion of
                         the construction phase at the project at Pine Bluff
                        and the final completion of the projects at Weldon
Spring and RMRS.          

Total gross profit is expected to increase by approximately $18 million from    
fiscal 2001 to 2002.                                                            

          a.       Power's projected gross profit is expected to
                   increase approximately $18 million due to the
                        implementation of certain overhead cost reductions
                          and the booking of more profitable work now once all
                        negative cash flow projects are either reformed or
rejected.                 

                  b.       Infrastructure and Mining's projected gross profit is
                       expected to increase $9 million due to run off of
                       profitable projects in the pipeline, specifically
                       E-470, the beginning of work on the profitable NW
                         Parkway project and the completion of projects with
                        losses during fiscal 2001 (which had a significant
                         adverse affect on the gross profit in fiscal 2001).

                c.       I/Ps projected gross profit is expected to increase
             by approximately $27 million due to the
                           implementation of certain overhead cost reductions, a
                          reduction in the unabsorbed labor due to an increase
                    in the chargeability of engineering resources.

                 d.       The Company booked a management adjustment to reduce
                    gross profit by $25 million (see assumptions).

                Billings in excess of cost was reduced by approximately $204
million from fiscal 2001 to 2002 due to the run off of Burlington Train 3, San  
Roque and Hudson Bergen, all of which had previously received large up front    
payments from the customer. The Projections do not assume that there are any    
projects that have large up front payments going forward.                       

2.       PRINCIPAL ASSUMPTIONS UNDERLYING THE PROJECTIONS     

           a.       Although the Debtors anticipate emergence from
                    Chapter 11 in September, 2001, there can be no
              assurance at this time that this will be
                          accomplished. Accordingly, the Projections portray a
                           financial condition and the results of operations and
                           cash flows assuming that the Debtors will emerge from
                          Chapter 11 on December 1, 2001 (the first day of the
                   Company's 2002 fiscal year). Washington Group
                          International, B.V. (formerly Raytheon Engineers and
                         Constructors B.V.) is part of a separate bankruptcy
                      filing in the Netherlands and will be liquidated
during 2001.              

               b.       The Projections assume that the Exit Facility will
               consist of a revolving credit facility of
                         approximately $350 million (the "Revolver") to fund
                    working capital, letters of credit and general
                          corporate purposes. As noted above, the Debtors have
                         not obtained a commitment for an Exit Facility, and
                         believe that the Plan will be feasible if a smaller
                           Exit Facility is ultimately obtained. The term of the
                           Revolver is assumed to be 3 years. The initial use of
                         the Revolver will be to repay any funded debt under
                           the DIP Facility and to replace any letters of credit
                      issued under the DIP Facility or the Prepetition
                     Credit Facility that remain outstanding. Funded
                         borrowings under the revolver peak at approximately
                          $100 million during fiscal year 2002. It is expected
                          that there will bo no other debt outstanding outside
of the Exit Facility.     

                 c.       Bonding capacity will be made available and new work
                     will not be constrained by any capacity issues.
                    Future bonds will not require letter of credit
                        support. The letter of credit collateral issued to
                          the sureties during the period of bankruptcy will be
                           released on the Effective Date. The amount of bonding
                          available is expected to be inversely related to the
                       amount of leverage. To the extent actual leverage
                     exceeds the projected amounts, bonding, and the
                          bonding dependent revenues and profit may be reduced
        (such reductions may be material).

           d.       Historically, MK (before the RE&C acquisition)
                          carried positive working capital of approximately 5%
                       of annual revenues. The large power projects from
                    RE&C, with the large advance payments, created
                     negative working capital. In the long term, WGI
                           management believes that Reorganized WGI will require
                       positive working capital. The Projections reflect
                          this shift from negative working capital to positive
                      working capital. The working capital increase is
                          expected to be funded with cash flow from operations
and the Revolver.         

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                  e.       Fresh start accounting adjustments in accordance with
                     SOP 90-7 are included in the Business Plan. The
                       preliminary enterprise value was assumed when the
                       Projections were prepared to be $550 million. See
                        SECTION XI.E for a summary of the final valuation.
                         $50 million has been allocated to debt arising from
                     repaying the projected borrowings under the DIP
                        Facility and to fund the WGI Creditor Trust on the
                Effective Date and $500 million to equity.
                           Outstanding borrowings and accrued interest under the
                           Prepetition Credit Agreement will be discharged under
                     the Plan, and holders of such debt will receive
                        equity in Reorganized WGI. All claims that WGI has
                     against Raytheon will be transferred to the WGI
                         Creditor Trust, and WGI will contribute $20 million
                       to the WGI Creditor Trust to fund litigation. The
                         goodwill on the balance sheet of approximately $523
                          million, which is part of the fresh start accounting
                           and is based on the Valuation, will not be amortized,
                     consistent with the recently proposed change in
accounting by the FASB.   

                 f.       The effective tax rate is estimated to be 40.0%. The
                           cash taxes paid will be significantly less due to the
                         continued amortization of goodwill ($65 million/yr)
                           for tax purposes. This will result in the deferral of
                       85%, 60% and 50% of taxes in 2002, 2003 and 2004.

            g.       The Petroleum and Chemicals Group will sell the
                      Technology Center before year-end 2001 and leave
                           Washington Group International, B.V. in receivership.
                         The remainder of the Petroleum and Chemicals Group,
                         which consists of the gas process business, will be
                    combined with I/P. This combination results in
        significant overhead cost savings.

         h.       The Estimated Operating Cash Flows have been
                       developed on a project-by-project basis for major
                           projects and estimated, by group and division, in the
     aggregate for smaller projects.

               i.       In addition to the cost reductions included in the
                           Projections, the Company will make further reductions
                         overhead and office locations in 2001 and 2002. The
                     Company will incur significant costs, including
                         employee severance and relocation costs, related to
                        these cost reductions. These costs, as well as the
                     associated benefit, have not been measured, and
                  consequently, have not been reflected in the
Projections.              

            j.       During the Chapter 11 Cases, WGI is expected to
                         reform or reject the following 3 projects: Red Oak,
                          Ilijan and EELV. Performance on the Sithe Mystic and
                          Fore River projects was terminated prepetition. As a
                   result, ongoing negative cash flow from these
projects is not projected.

                 k.       Burlington Resources (Burlington Train 3 project) is
             expected to continue to pay vendors and
                    subcontractors directly until October 1, 2001.
                           Thereafter, WGI will work under the original contract
                           to complete the project. The Train 3 project received
                           large advance payments in prior periods. Beyond 2001,
              the contract has a negative cash flow of
                         approximately of $45 to $50 million. The reasons to
 continue this contract are:

                     (i)      Similar projects are very important to
                                 future growth potential from existing and
                                  new client, including Burlington Resources
        and Exxon/Mobil.

                   (ii)     As this is not a Raytheon guaranteed
                                project, the adverse consequences to the
                                  Company's other businesses could be severe
                       if this contract were rejected.

               l.       The sale of the Electro Mechanical Division of the
                         Westinghouse Group is assumed to occur in the first
                          quarter of 2002 for $50 million of which $30 million
 (60%) would be paid to WGI.

                  m.       Capital expenditures are expected to be approximately
                           $43.2 million in 2002. These capital expenditures are
                  made up of approximately $33 million for the
                     Infrastructure and Mining Group ($10 million to
                         maintain the existing fleet and $23 million for new
                         projects), approximately $6.0 million for the other
                  groups and approximately $4.0 million at the
corporate level.          

             n.       Management has made an adjustment to reduce 2002
                      gross profit by $25 million. This is an order of
                   magnitude adjustment to take into account the
                         potential impact of several risks that exist in the
                      transition period as the Debtors emerge from the
                Chapter 11 Cases and return to more normal
     operations. Such risks include:

                       (i)      Although the Debtors currently expect to
                                emerge from bankruptcy during its fiscal
           2001 (in September,

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                                  2001), events could occur that might delay
                                   confirmation of the Plan or their emergence
                          from bankruptcy. Such delays could
                                  negatively impact the Company's successful
                               acquisition of new contracts and extend
                           bankruptcy related costs into 2002.

                   (ii)     While management has included in the
                                  Projections its best estimate of new work,
                               it is possible that new work may not be
                            obtained, or "ramp-up" as quickly as
                                    estimated and/or that the cost to obtain new
                                 work (sales and bid & proposal costs) may
                                  exceed estimates. Either possibility would
                               negatively impact gross profit in 2002.

                           (iii)    In preparing the Projections, management has
                                   developed its best estimate of the costs of
                                  operating the business after the Effective
                                    Date. However, there may be unforeseen costs
                               that arise during the initial period of
                               operations that would negatively impact
          financial results.

                     (iv)     Management has undertaken a program to
                       reduce overhead and general and
                                   administrative costs across the Company. It
                               is possible that cost reduction efforts
                                 anticipated by the Projections may not be
                       achieved as quickly as planned.

                    (v)      On Friday, June 22, 2001, the Defense
                                    Contract Audit Agency (DCAA) issued an audit
                         report on the Company's financial
                                  suitability as a government contractor, in
                             which it concluded that "WGI is in an
                                  adverse financial condition" and "may have
                                  difficulty meeting its near term financial
                                   obligations and may be unable to perform on
                                  government contracts without extraordinary
                                 management actions". The Company rebutted
                                    DCAA's opinion and the rebuttal was included
                                   as an appendix to the audit report. DCAA is
                             obliged to update their report as the
                              bankruptcy process proceeds and as the
                                  Debtors emerge from bankruptcy. Management
                                  expects Government's ability to obtain new
                                   work to be impacted by DCAA's audit report.
                            Should the DCAA not provide a timely
                             revision to their audit report as the
                                    Debtors emerge from bankruptcy, Government's
                              operations may be negatively impacted.

                        (vi)     Management's evaluation of the I/P market
                              indicates some current softness and an
                                expectation of continued softness in the
                                   near future. While management has developed
                                    its best estimate of new work for I/P, it is
                                  possible that such new work levels may not
                                  be attained, which would negatively impact
          financial results.

                     (vii)    The Company's projected balance sheets
                             indicate that at the end of 2002, the
                                 Company will have negligible tangible net
                                    worth. Tangible net worth is a key factor in
                                   the evaluation of bond worthiness by surety
                                    companies. Because the tangible net worth is
                                   negligible, it is possible that the Company
                               may not be able to obtain all the bonds
                                  anticipated by the Projections or that the
                            premiums charged may be greater than
  projected.

            o.       The Projections include an increase in accounts
                         receivable of $40 million in each of 2003 and 2004,
                          which is reflected in corporate accounts receivable.
                        These increases are to reflect Management's belief
                           that overtime and working capital (exclusive of cash)
                          will be approximately equal to 5% of revenues. While
                    the actual increases will occur in the various
                     components of each groups' working capital, for
                       convenience of presentation, these estimates have
                         been reflected only in accounts receivable and have
                    not been pushed down to the respective groups.

 VI. SUMMARY OF THE PLAN OF REORGANIZATION

     THIS SECTION PROVIDES A SUMMARY OF THE STRUCTURE,
CLASSIFICATION, TREATMENT AND IMPLEMENTATION OF THE PLAN AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO THE PLAN, WHICH ACCOMPANIES THIS DISCLOSURE STATEMENT, 
AND TO THE EXHIBITS ATTACHED THERETO.                                           

              THE PLAN ITSELF AND THE DOCUMENTS REFERRED TO THEREIN WILL
CONTROL THE TREATMENT OF CREDITORS AND EQUITY SECURITY HOLDERS UNDER THE PLAN   
AND WILL, UPON THE EFFECTIVE DATE, BE BINDING UPON HOLDERS OF CLAIMS AGAINST, OR
INTERESTS IN, THE DEBTORS, THE REORGANIZED DEBTORS AND OTHER PARTIES IN         
INTEREST.                                                                       

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A.       OVERALL STRUCTURE OF THE PLAN                                          

                  Chapter 11 is the principal business reorganization chapter of
the Bankruptcy Code. Under Chapter 11, a debtor is authorized to reorganize its 
business for the benefit of its creditors and shareholders. Upon the filing of a
petition for relief under Chapter 11, section 362 of the Bankruptcy Code        
provides for an automatic stay of substantially all acts and proceedings against
the debtor and its property, including all attempts to collect claims or enforce
liens that arose prior to the commencement of the Chapter 11 case.              

                 The consummation of a plan of reorganization is the principal
objective of a Chapter 11 case. A plan of reorganization sets forth the means   
for satisfying claims against and interests in a debtor. Confirmation of a plan 
of reorganization by the Bankruptcy Court makes the plan binding upon the       
debtor, any issuer of securities under the plan, any person or entity acquiring 
property under the plan, and any creditor of or equity security holder in the   
debtor, whether or not such creditor or equity security holder (i) is impaired  
under or has accepted the plan or (ii) receives or retains any property under   
the plan. Subject to certain limited exceptions and other than as provided in   
the plan itself or the confirmation order, the confirmation order discharges the
debtor from any debt that arose prior to the date of confirmation of the plan   
and substitutes therefor the obligations specified under the confirmed plan, and
terminates all rights and interests of equity security holders.                 

                 The terms of the Plan are based upon, among other things, the
Debtors' assessment of their ability to achieve the goals of their Business     
Plan, make the distributions contemplated under the Plan and pay certain of     
their continuing obligations in the ordinary course of the Reorganized Debtors' 
businesses as approved by the Bankruptcy Court. Under the Plan, Claims against, 
and Interests in, the Debtors are divided into Classes according to their       
relative seniority and other criteria.                                          

        If the Plan is confirmed by the Bankruptcy Court and
consummated, (i) the Claims in certain Classes will be reinstated or modified   
and receive distributions equal to the full amount of such Claims, and (ii) the 
Claims in other Classes will be modified and receive distributions constituting 
a partial recovery on such Claims. On the Effective Date and at certain times   
thereafter, the Reorganized Debtors will distribute Cash, securities and other  
property in respect of certain Classes of Claims as provided in the Plan. The   
Classes of Claims against the Debtors created under the Plan, the treatment of  
those Classes under the Plan and the securities and other property to be        
distributed under the Plan are described below.                                 

B.       SUBSTANTIVE CONSOLIDATION FOR PURPOSES OF TREATING IMPAIRED CLAIMS     

                  The Plan is premised upon the substantive consolidation of the
Debtors only with respect to the treatment of Class 6 and 7 Claims under the    
Plan, for voting, confirmation and distribution purposes. The Plan does not     
contemplate the substantive consolidation of the Debtors with respect to other  
Classes of Claims or Interests set forth in the Plan. Substantive consolidation 
under the Plan will not effect a transfer or commingling of any assets of any   
Debtors, and all assets (whether tangible or intangible) will continue to be    
owned by the respective Debtors.                                                

          Generally, substantive consolidation of the estates of
multiple debtors in a bankruptcy case effectively combines the assets and       
liabilities of the multiple debtors for certain purposes under a plan. The      
effect of consolidation is the pooling the assets of, and claims against, the   
consolidated debtors; satisfying liabilities from a common fund; and combining  
the creditors of the debtors for purposes of voting on reorganization plans.    
There is no statutory authority specifically authorizing substantive            
consolidation. The authority of a bankruptcy court to order substantive         
consolidation is derived from its general equitable powers under section 105(a) 
of the Bankruptcy Code, which provides that the court may issue orders necessary
to carry out the provisions of the Bankruptcy Code. Nor are there statutorily   
prescribed standards for substantive consolidation. Instead, judicially         
developed standards control whether substantive consolidation should be granted 
in any given case.                                                              

                The propriety of substantive consolidation must be evaluated
on a case-by-case basis. The extensive list of elements and factors frequently  
cited and relied upon by courts in determining the propriety of substantive     
consolidation are may be viewed as variants on two critical factors, namely, (i)
whether creditors dealt with the entities as a single economic unit and did not 
rely on their separate identity in extending credit or (ii) whether the affairs 
of the debtors are so entangled that consolidation will benefit all creditors.  
Some courts have viewed those elements and factors as examples of information   
that may be useful to courts charged with deciding whether there is substantial 
identity between the entities to be consolidated and whether consolidation is   
necessary to avoid some harm or to realize some benefit.                        

             Among the factors or elements looked to by courts are the
following:                                                                      

        o        the degree of difficulty in segregating and
                           ascertaining the individual assets and liabilities of
the entities to be        

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consolidated;             

              o        the presence or absence of consolidated financial
                       statements among the entities to be consolidated;

             o        the commingling of assets and business functions
            among the entities to be consolidated;

           o        the unity of interests and ownership among the
various entities;         

                  o        the existence of parent and intercorporate guarantees
           on loans to the various entities; and

           o        the transfer of assets to and from the various
                     entities without formal observance of corporate
formalities.              

          The facts and circumstances surrounding the historical
business operations of the WGI and the Subsidiary Debtors support substantive   
consolidation in these Chapter 11 Cases for the limited purposes of voting,     
confirmation and distributions to Classes 6 and 7. Creditors generally view the 
Company as a single economic unit, except for joint ventures and the            
Westinghouse Group, which are not Debtors in these cases. Importantly, all      
obligations to the Prepetition Secured Lenders and the holders of Old Notes are 
guaranteed by identical subsidiaries, which are the principal operating Debtor  
subsidiaries of the Company. WGI and the Subsidiary Debtors historically have   
issued consolidated financial statements and filed consolidated tax returns. WGI
and its Subsidiary Debtors have common officers and directors, and have shared  
key employees and outside professionals, including, but not limited to,         
employees of WGI who perform human resources, legal, and risk management        
services for the benefit of all the Debtors and accounting firms, law firms,    
engineers and consultants who rendered services to all of the Debtors. In       
addition, the Debtors' cash management system is highly centralized. As an      
outgrowth of this consolidated cash management system, intercompany loans       
routinely are made by and between WGI and the Subsidiary Debtors (and by and    
between the Subsidiary Debtors themselves) in the ordinary course of the        
Debtors' business. Accordingly, the Debtors believe that substantive            
consolidation for limited purposes of voting, confirmation and distributions to 
Classes 6 and 7 is warranted in light of the criteria established by the courts 
in ruling on the propriety of substantive consolidation in other cases.         

         Certain parties have stated that they may oppose, and
Mitsubishi has stated that it will oppose, the substantive consolidation        
proposed under the Plan on the grounds that they believe that certain creditors 
may be adversely affected by such substantive consolidation including creditors 
that hold a claim against a single Debtor or that substantive consolidation is  
improper under the circumstances. These situations may be fact specific. The    
Debtors do not believe that the substantive consolidation proposed in the Plan  
will negatively impact creditor recoveries. The Bankruptcy Court will hear any  
objections to the substantive consolidation proposed in the Plan at the         
Confirmation Hearing. Therefore, any creditor who opposes the substantive       
consolidation proposed under the Plan must file an objection to the Plan or     
enter into an agreement with the Debtors reserving their right prior to the     
Confirmation Hearing. See SECTION II.E for instructions as to how to file an    
objection to the Plan. As part of their monthly operating reports, which are    
available on the Court's website, the Debtors file certain balance sheet        
information for individual Debtors.                                             

         Additionally, certain creditors have asserted that if
substantive consolidation of the Debtors as proposed under the Plan occurs,     
there would be no need for classification of Class 4 Claims. The Debtors dispute
this assertion.                                                                 

C.       CLASSIFICATION AND TREATMENT OF CLAIMS AND INTERESTS                   

               Section 1122 of the Bankruptcy Code provides that a plan of
reorganization must classify the claims and interests of a debtor's creditors   
and equity interest holders. In accordance with section 1122, the Plan divides  
Claims and Interests into Classes and sets forth the treatment for each Class   
(other than DIP Facility Claims, Administrative Claims and Priority Tax Claims  
which, pursuant to section 1123(a)(1), do not need to be classified). The       
Debtors also are required, under section 1122 of the Bankruptcy Code, to        
classify Claims against and Interests in the Debtors into Classes that contain  
Claims and Interests that are substantially similar to the other Claims and     
Interests in such Class.                                                        

                  Under the Plan, unsecured Claims are placed into two classes -
Class 3 and Class 7. Claims in Class 7 are General Unsecured Claims, excluding  
only Unimpaired Unsecured Claims, and include, without limitation, the Old Note 
Claims, the Raytheon Asserted Claims (if any) and the Lender Deficiency Claims. 
Class 7 Claims are designated as Impaired. Claims in Class 3 are comprised of   
Employee Claims, which are defined as unsecured Claims of any person employed by
any of the Debtors on the Petition Date other than Claims arising as a result of
the assumption of any contract or agreement or the rejection of any contract or 
agreement on Schedule 6.3 of the Plan, or that are tort claims.. Class 3 Claims 
are designated as Unimpaired. The Debtors believe that separate classification  
and treatment of the Employee Claims is appropriate because employees are the   
principal asset of the Debtors. Maintenance of normal employee relations and    
morale is critical to the Debtors' reorganization efforts and long-term value.  

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               The Debtors believe that the Plan has classified all Claims
and Interests in compliance with the provisions of section 1122 and applicable  
case law, but it is possible that a holder of a Claim or Interest may challenge 
the Debtors' classification of Claims and Interests and that the Bankruptcy     
Court may find that a different classification is required for the Plan to be   
confirmed. In that event, the Debtors intend, to the extent permitted by the    
Bankruptcy Code, the Plan and the Bankruptcy Court, to make such reasonable     
modifications of the classifications under the Plan to permit confirmation and  
to use the Plan acceptances received in this Solicitation for purposes of       
obtaining the approval of the reconstituted Class or Classes of which each      
accepting holder ultimately is deemed to be a member. Any such reclassification 
could adversely affect the Class in which such holder initially was a member, or
any other Class under the Plan, by changing the composition of such Class and   
the vote required of that Class for approval of the Plan.                       

                  The amount of any Impaired Claim that ultimately is allowed by
the Bankruptcy Court may vary from any estimated allowed amount of such Claim   
and accordingly the total Claims ultimately allowed by the Bankruptcy Court with
respect to each Impaired Class of Claims may also vary from any estimates       
contained herein with respect to the aggregate Claims in any Impaired Class.    
Thus, the value of the property that ultimately will be received by a particular
holder of an Allowed Claim under the Plan may be adversely or favorably affected
by the aggregate amount of Claims ultimately allowed in the applicable Class.   

                The classification of Claims and Interests and the nature of
distributions to members of each Class are summarized below. The Debtors believe
that the consideration, if any, provided under the Plan to holders of Claims and
Interests reflects an appropriate resolution of their Claims and Interests,     
taking into account the differing nature and priority (including applicable     
contractual and statutory subordination) of such Claims and Interests and the   
fair value of the Debtors' assets. In view of the deemed rejection by Class 8,  
however, as set forth below, the Debtors will seek confirmation of the Plan     
pursuant to the "cramdown" provisions of the Bankruptcy Code. Specifically,     
section 1129(b) of the Bankruptcy Code permits confirmation of a Chapter 11 plan
in certain circumstances even if the plan has not been accepted by all impaired 
classes of claims and interests. SEE SECTION VI.N.2. Although the Debtors       
believe that the Plan can be confirmed under section 1129(b), there can be no   
assurance that the Bankruptcy Court will find that the requirements to do so    
have been satisfied.                                                            

1.       TREATMENT OF UNCLASSIFIED CLAIMS UNDER THE PLAN      

a.       DIP FACILITY CLAIMS                

                  DIP Facility Claims are Claims arising under or as a result of
the DIP Facility. On the Effective Date, each holder of an Allowed DIP Facility 
Claim shall receive in full satisfaction, settlement, release, and discharge of 
and in exchange for such Allowed DIP Facility Claim (i) Cash equal to the unpaid
portion of such Allowed DIP Facility Claim or (ii) such other treatment as to   
which WGI and such holder shall have agreed upon in writing.                    

b.       ADMINISTRATIVE CLAIMS              

                  The Plan provides that for Administrative Claims to be paid in
full. Administrative Claims consist of the actual and necessary costs and       
expenses of the Chapter 11 Cases that are allowed under sections 503(b) and     
507(a)(1) of the Bankruptcy Code. They include, among other things, the cost of 
operating the Debtors' businesses following the Petition Date (E.G., the        
post-petition salaries and other benefits for the Debtors' employees which the  
Debtors have obtained an order allowing them to pay in the ordinary course of   
business, post-petition rent, amounts owed to vendors providing goods and       
services to the Debtors during the Chapter 11 Cases, tax obligations incurred   
after the Petition Date, certain statutory fees and charges assessed under 28   
U.S.C. Section 1930) and the actual, reasonable fees and expenses of the        
professionals retained by the Debtors and the Creditors' Committee. All payments
to professionals in connection with the Chapter 11 Cases for compensation and   
reimbursement of expenses and all payments to reimburse expenses of members of  
the Creditors' Committee will be made in accordance with the procedures         
established by the Bankruptcy Code and the Bankruptcy Rules and will be subject 
to approval of the Bankruptcy Court as being reasonable.                        
              The estimated amount of non-ordinary course Administrative
Claims to be incurred during the Chapter 11 Cases (which are primarily comprised
of professional fees and which will be paid, in part, during the Chapter 11     
Cases pursuant to Bankruptcy Court orders), is approximately $20 million.       

      Except as otherwise provided in and subject to the
requirements of the Plan, the Plan provides that on or as soon as reasonably    
practicable after the latest of (i) the Distribution Date, (ii) the date an     
Administrative Claim becomes an Allowed Administrative Claim, or (iii) the date 
an Administrative Claim becomes payable pursuant to any agreement between a     
Debtor and the holder of such Administrative Claim, each holder of an Allowed   
Administrative Claim will receive in full satisfaction, settlement, release and 
discharge of and in exchange for such Allowed Administrative Claim (x) Cash     
equal to the unpaid portion of such Allowed Administrative Claim or (y) such    
other treatment as to which the applicable Debtor and such holder shall have    
agreed upon in writing; PROVIDED, HOWEVER, that Allowed                         

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Administrative Claims with respect to liabilities incurred by a Debtor in the   
ordinary course of business during the Chapter 11 Cases will be paid in the     
ordinary course of business in accordance with the terms and conditions of any  
agreements relating thereto.                                                    

                  Holders of Administrative Claims based on liabilities incurred
by the Debtors in the ordinary course of their businesses will not be required  
to file or serve any request for payment of such Claims, as these liabilities   
will be assumed by the applicable Reorganized Debtor and paid, performed or     
settled when due in accordance with the terms and conditions of the particular  
agreements governing such obligations.                                          

c.       PRIORITY TAX CLAIMS                

                Priority Tax Claims are Unsecured Claims asserted by federal
and state governmental authorities for taxes specified in section 507(a)(8) of  
the Bankruptcy Code, such as certain income taxes, property taxes, excise taxes,
and employment and withholding taxes. These Unsecured Claims are given a        
statutory priority in right of payment.                                         

            Under the Plan, except to the extent that a holder of an
Allowed Priority Tax Claim has been paid by the Debtors prior to the            
Distribution Date or has agreed in writing to a different treatment, each holder
of an Allowed Priority Tax Claim will be paid, at the sole discretion of the    
Debtors, (i) equal Cash payments made on the last Business Day of every         
three-month period following the Effective Date, over a period not exceeding six
years after the assessment of the tax on which such Claim is based, totaling the
principal amount of such Claim plus simple interest on any outstanding balance  
from the Effective Date calculated at the interest rate available on ninety (90)
day United States Treasuries on the Effective Date, or (ii) such other treatment
as to which a Debtor and such holder shall have agreed upon in writing.         

               The Debtors estimate that aggregate Priority Tax Claims are
approximately $18 to $20 million.                                               

      2.       TREATMENT OF CLASSIFIED CLAIMS AND INTERESTS UNDER THE PLAN

a.       UNIMPAIRED CLASSES OF CLAIMS       

            (i)     CLASS 1 -OTHER PRIORITY CLAIMS

                Class 1 consists of all Claims entitled to priority pursuant
to section 507(a) of the Bankruptcy Code other than DIP Facility Claims,        
Priority Tax Claims or Administrative Claims.                                   

            Under the Plan, on, or as soon as reasonably practicable
after, the latest of (i) the Distribution Date, (ii) the date such Class 1 Claim
becomes an Allowed Class 1 Claim, or (iii) the date such Class 1 Claim becomes  
payable pursuant to any agreement between a Debtor and the holder of such Class 
1 Claim, each holder of an Allowed Class 1 Claim will receive in full           
satisfaction, settlement, release and discharge of and in exchange for such     
Allowed Class 1 Claim (x) Cash equal to the unpaid portion of such Allowed Class
1 Claim or (y) such other treatment as to which a Debtor and such holder shall  
have agreed upon in writing. Class 1 Claims are Unimpaired and therefore not    
entitled to vote on the Plan.                                                   

            (ii)     CLASS 2 -OTHER SECURED CLAIMS

              Class 2 consists of separate subclasses of claims that are
secured by a Lien upon property in which the Estate has an interest, to the     
extent of the value of the Claim holders' interest in the Estate's interest in  
such property, as determined pursuant to section 506(a) of the Bankruptcy Code  
against the Debtors other than the Secured Lender Claims included in Class 6    
below ("Other Secured Claims"). Each subclass is deemed to be a separate Class  
for all purposes under the Bankruptcy Code.                                     

               On the Effective Date, the legal, equitable and contractual
rights of holders of an Allowed Class 2 Claim shall be Reinstated, subject to   
the provisions of ARTICLE VII of the Plan. The Debtors' failure to object to any
such Class 2 Claims in the Chapter 11 Cases shall be without prejudice to the   
rights of WGI or the Reorganized Debtors to contest or otherwise defend against 
such Claim in the appropriate forum when and if such Claim is sought to be      
enforced by the Other Secured Claim holder. Notwithstanding section 1141(c) or  
any other provision of the Bankruptcy Code, all pre-petition liens on property  
of any Debtor held by or on behalf of the Other Secured Claim holders with      
respect to such Claims shall survive the Effective Date and continue in         
accordance with the contractual terms of the underlying agreements with such    
Claim holders until, as to each such Claim holder, the Allowed Claims of such   
Other Secured Claim holder are paid in full, subject to the provisions of       
ARTICLE VII of the Plan.                                                        

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               Class 2 Claims are Unimpaired and therefore not entitled to
vote on the Plan.                                                               

                    (iii)     CLASS 3 -UNIMPAIRED UNSECURED CLAIMS

Class 3 consists of Employee Claims.        

                 Under the Plan, each holder of an Allowed Class 3 Claim shall
have its Claim Reinstated. Class 3 Claims are Unimpaired and therefore not      
entitled to vote on the Plan.                                                   

         (iv)   CLASS 4 -INTERCOMPANY CLAIMS

               Class 4 consists of, as the case may be, any Claim (a) by a
Debtor against another Debtor or (b) by a Non-Debtor Subsidiary against a       
Debtor.                                                                         

                 Under the Plan and except as is provided therein, each holder
of an Allowed Class 4 Claim shall have its Claim Reinstated. Class 4 Claims are 
Unimpaired and therefore not entitled to vote on the Plan.                      

            (v)      CLASS 5 -SUBSIDIARY INTERESTS

                  Class 5 consists of the issued and outstanding shares of stock
the subsidiaries directly or indirectly owned by WGI, as of the Petition Date.  
Under the Plan, subject to the Restructuring Transactions, if any, all Class 5  
Interests will be Reinstated. Class 5 Interests are Unimpaired and therefore not
entitled to vote on the Plan.                                                   

b.       IMPAIRED CLAIMS AND INTERESTS      

            (i)     CLASS 6 -SECURED LENDER CLAIMS

                 Class 6 consists of all Secured Claims of Prepetition Secured
Lenders arising under or as a result of the Prepetition Senior Secured Credit   
Facility, which Claims will be deemed Allowed pursuant to the Plan in the       
approximate amount of $505 million, adjusted downward (if necessary) by the     
Confirmation Hearing as a result of the issuance of the Washington Stock        
Options.                                                                        

        Under the Plan, on the Effective Date, each holder of an Allowed Class
6 Claim, in full satisfaction, settlement, release, and discharge of and in     
exchange for such Allowed Class 6 Claim, will receive on or as soon as          
practicable after the Distribution Date, its Pro Rata share one-hundred percent 
(100%) of the New Common Shares issued and outstanding as of the Effective Date 
subject to Dilution. Class 6 Claims are Impaired and entitled to vote on the    
Plan.                                                                           

                 (ii)     CLASS 7 - GENERAL UNSECURED CLAIMS

               Claims in Class 7 are those Claims against the Debtors that
are not DIP Facility Claims, Administrative Claims, Priority Tax Claims, Other  
Priority Claims, Other Secured Claims, Intercompany Claims, Secured Lender      
Claims or Unimpaired Unsecured Claims, and include, without limitation, the Old 
Note Claims, the Raytheon Asserted Claims (if any) and the Lender Deficiency    
Claims (which claims are deemed Allowed pursuant to the Plan in an amount to be 
established by the Confirmation Hearing). Lender Deficiency Claims will be      
established based primarily upon the amount of funded debt owed to the          
Prepetition Secured Lenders MINUS the amount of the Secured Lender Claims.      
Currently, there are approximately $130 million in undrawn letters of credit    
under the Prepetition Senior Secured Credit Facility. Significant draws upon the
undrawn letters of credit under the Prepetition Senior Secured Credit Facility  
prior to the Confirmation Hearing are not anticipated, but if they were to      
occur, would increase the amount of the Lender Deficiency Claims on a dollar for
dollar basis.                                                                   

            Under the Plan, on the Effective Date, each holder of an
Allowed Class 7 Claim shall be deemed to receive, in full satisfaction,         
settlement, release and discharge of and in exchange for such Allowed Class 7   
Claim, a pro rata beneficial interest in the WGI Creditor Trust, and shall be   
entitled to receive pro rata distributions from the WGI Creditor Trust pursuant 
to the terms and conditions set forth in SECTION 9.7 of the Plan and the WGI    
Creditor Trust Agreement until such Claim is paid in full with interest accruing
from the Petition Date, at a rate of 20% per annum, compounded quarterly. Class 
7 Claims are Impaired and entitled to vote on the Plan.                         

                        (iii)     CLASS 8 - WGI INTERESTS AND SUBORDINATED
CLAIMS

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       Class 8 consists of all WGI Interests and any Claim
subordinated pursuant to sections 510(b) or (c) of the Bankruptcy Code. Under   
the Plan, the holders of WGI Interests and Subordinated Claims shall not receive
or retain any property under the Plan on account of such Interests or Claims,   
other than the WGI Creditor Trust Equity Residual, if any. The WGI Creditor     
Trust Equity Residual consists of any Net Trust Recovery remaining after payment
in full of each Allowed General Unsecured Claim plus interest accruing from the 
Petition Date, at a rate of 20% per annum, compounded quarterly. On the         
Effective Date, all of the WGI Interests shall be deemed cancelled and          
extinguished. Class 8 Claims and Interests are Impaired and are presumed to     
receive no distribution under the Plan and are therefore deemed to reject the   
Plan and are not entitled to vote on the Plan.                                  

3.       RESERVATION OF RIGHTS REGARDING CLAIMS               

                Except as otherwise explicitly provided in the Plan, nothing
shall affect the Debtors' or Reorganized Debtors' rights and defenses, both     
legal and equitable, with respect to any Claims, including, but not limited to, 
all rights with respect to legal and equitable defenses to alleged rights of    
setoff or recoupment. Notwithstanding the substantive consolidation of the      
Debtors, the Claims of any particular Debtor that are Unimpaired shall remain   
the obligations solely of such Debtor and shall not become obligations of any   
other Debtor or Reorganized Debtor.                                             

4.       RAYTHEON ASSERTED CLAIMS                             

             Raytheon has indicated that it believes that it has valid
claims against the Debtors. SEE APPENDIX D. The Debtors believe that, among     
other things, as a result of the Debtors claims against Raytheon, Raytheon is a 
debtor to the Debtors, not a creditor. Moreover, the Debtors dispute that       
Raytheon has any Claims that can or should be allowed, including, without       
limitation, by operation of section 502(d) of the Bankruptcy Code. In addition, 
notwithstanding anything in the Plan to the contrary, it is the Debtors'        
intention to commence an action and to seek an order of the Bankruptcy Court to 
object to and, if necessary, to seek to equitably subordinate all Raytheon      
Asserted Claims pursuant to section 510(c) of the Bankruptcy Code or otherwise. 
In the event such subordination is successful, any Raytheon Asserted Claims that
would otherwise be Allowed will be classified in Class 8. SEE SECTION VI.C.4.   

D.       DISTRIBUTIONS UNDER THE PLAN                                           

                  Except as set forth in the succeeding sentence, the Disbursing
Agent shall make all distributions required under this Plan. Distributions      
provided for in the Plan on account of Allowed Class 7 Claims shall be made by  
the Trustee. The WGI Creditor Trust Agreement shall provide that any            
distributions to be made on account of Allowed Old Note Claims shall be made to 
the Indenture Trustee, as Disbursing Agent for Old Note Claims, for further     
distribution to holders of Allowed Old Note Claims.                             

         If the Disbursing Agent is an independent third party
designated by the Reorganized Debtors to serve in such capacity, such Disbursing
Agent shall receive, without further Bankruptcy Court approval, reasonable      
compensation for distribution services rendered pursuant to the Plan and        
reimbursement of reasonable out-of-pocket expenses incurred in connection with  
such services from the Reorganized Debtors on terms acceptable to the           
Reorganized Debtors. No Disbursing Agent shall be required to give any bond or  
surety or other security for the performance of its duties unless otherwise     
ordered by the Bankruptcy Court.                                                

                 Cash payments made pursuant to the Plan will be in U.S. funds
by means agreed to by the payor and the payee, including by check or wire       
transfer, or, in the absence of an agreement, such commercially reasonable      
manner as the payor shall determine in its sole discretion.                     

           Except as otherwise provided in the Plan, any ancillary
documents entered into in connection therewith, or the Confirmation Order, the  
Debtors shall have the right to prepay, without penalty, all or any portion of  
an Allowed Claim at any time; PROVIDED, HOWEVER, that any such prepayment shall 
not violate, or otherwise prejudice, the relative priorities among the classes  
of Claims. On the Effective Date, Reorganized WGI shall issue or distribute in  
accordance with the provisions of the Plan all of the New Common Shares         

    1.       DISTRIBUTIONS FOR CLAIMS ALLOWED AS OF THE EFFECTIVE DATE

a.       DISTRIBUTION DATE                  

            Except as otherwise provided herein or as ordered by the
Bankruptcy Court, distributions to be made on account of Claims that are Allowed
Claims as of the Effective Date shall be made as soon as practicable after the  
Effective Date. Distributions on account of Claims that first become Allowed    
Claims after the Effective Date shall be made pursuant to ARTICLE VII of the    
Plan.                                                                           

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Notwithstanding the date on which any distribution of securities is actually    
made to a holder of a Claim or Interest that is an Allowed Claim or Allowed     
Interest on the Effective Date, as of the date of the distribution such holder  
shall be deemed to have the rights of a holder of such securities distributed as
of the Effective Date.                                                          

                b.       RECORD DATE FOR DISTRIBUTIONS TO HOLDERS OF SECURED
 LENDER CLAIMS AND OLD NOTES

       Under the Plan, the Distribution Record Date is the
Confirmation Date, unless determined to be otherwise in the Confirmation Order. 
At the close of business on the Distribution Record Date, the transfer records  
for the Secured Lender Claims and Old Note holder claims shall be closed, and   
there shall be no further changes in the record holders of Secured Lender Claims
or Old Notes. None of Reorganized WGI, the Disbursing Agent, if any, the        
Trustee, nor the Administrative Agent for the Prepetition Secured Lenders shall 
have any obligation to recognize any transfer of such Secured Lender Claims or  
Old Note holder claims occurring after the Distribution Record Date and shall be
entitled instead to recognize and deal for all purposes hereunder with only     
those record holders as of the close of business on the Distribution Record     
Date.                                                                           

              c.       CALCULATION OF DISTRIBUTION AMOUNTS OF NEW COMMON
SHARES                    

                No fractional shares of New Common Shares shall be issued or
distributed under the Plan. Each Person entitled to receive New Common Shares   
will receive the total number of whole shares of New Common Shares to which such
Person is entitled. Whenever any distribution to a particular Person would      
otherwise call for distribution of a fraction of a share of New Common Shares   
the actual distribution of shares of such stock shall be rounded to the next    
higher or lower whole number as follows: (a) fractions 1/2 or greater shall be  
rounded to the next higher whole number, and (b) fractions of less than 1/2     
shall be rounded to the next lower whole number. The total number of shares of  
New Common Shares to be distributed to Class 6 shall be adjusted as necessary to
account for the rounding provided for in ARTICLE VII of the Plan. No            
consideration shall be provided in lieu of fractional shares that are rounded   
down.                                                                           

d.       DELIVERY OF DISTRIBUTIONS          

               Distributions to holders of Allowed Claims shall be made by
the Disbursing Agent (a) at the addresses set forth on the Proofs of Claim filed
by such holders (or at the last known addresses of such holders if no Proof of  
Claim is filed or if the Debtors have been notified of a change of address), (b)
at the addresses set forth in any written notices of address changes delivered  
to the Disbursing Agent after the date of any related Proof of Claim, (c) at the
addresses reflected in the Schedules if no Proof of Claim has been filed and the
Disbursing Agent has not received a written notice of a change of address, or   
(d) at the addresses set forth in a properly completed letter of transmittal    
accompanying securities properly remitted to the Debtors. If any holder's       
distribution is returned as undeliverable, no further distributions to such     
holder shall be made unless and until the Disbursing Agent (or Trustee as       
applicable) is notified of such holder's then current address, at which time all
missed distributions shall be made to such holder without interest. Amounts in  
respect of undeliverable distributions made by the Disbursing Agent (or the     
Trustee as applicable), shall be returned to the Reorganized Debtors (or the WGI
Creditor Trust, as applicable) until such distributions are claimed. All claims 
for undeliverable distributions made by the Disbursing Agent must be made on or 
before the first (1st) anniversary of the Effective Date, after which date all  
unclaimed property shall revert to the Reorganized Debtors free of any          
restrictions thereon and the claim of any holder or successor to such holder    
with respect to such property shall be discharged and forever barred,           
notwithstanding any federal or state escheat laws to the contrary. Nothing      
contained in the Plan shall require the Debtors, Reorganized Debtors, any       
Disbursing Agent or the Indenture Trustee to attempt to locate any holder of an 
Allowed Claim.                                                                  

e.       OLD NOTES                          

               Except as provided in ARTICLE VII of the Plan in connection
with lost, stolen, mutilated or destroyed Old Notes, each holder of an Allowed  
Claim evidenced by an Old Note shall tender such Old Note to the Disbursing     
Agent in accordance with written instructions to be provided in a letter of     
transmittal to such holders by the Disbursing Agent as promptly as practicable  
following the Effective Date. Such letter of transmittal shall specify that     
delivery of such notes or Old Notes will be effected, and risk of loss and title
thereto will pass, only upon the proper delivery of such notes or Old Notes with
the letter of transmittal in accordance with such instructions. Such letter of  
transmittal shall also include, among other provisions, customary provisions    
with respect to the authority of the holder of the applicable note or Old Notes 
to act and the authenticity of any signatures required on the letter of         
transmittal. All surrendered notes and Old Notes shall be marked as canceled and
delivered by the Trustee to Reorganized WGI.                                    

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 f.       LOST, MUTILATED OR DESTROYED OLD NOTES

        In addition to any requirements under the applicable
certificate or articles of incorporation or bylaws of the applicable Debtor, any
holder of a Claim evidenced by an Old Note that has been lost, stolen, mutilated
or destroyed shall, in lieu of surrendering Old Note, deliver to the Disbursing 
Agent (i) evidence satisfactory to the Disbursing Agent of the loss, theft,     
mutilation or destruction; and (ii) such indemnity as may be required by the    
Disbursing Agent to hold the Disbursing Agent harmless from any damages,        
liabilities or costs incurred in treating such individual as a holder of an Old 
Note. Upon compliance with ARTICLE VII of the Plan by a holder of a Claim       
evidenced by an Old Note, such holder shall, for all purposes under the Plan, be
deemed to have surrendered its Old Note, as applicable.                         

    g.       FAILURE TO SURRENDER CANCELED OLD NOTES

                  Any holder of an Old Note that fails to surrender or be deemed
to have surrendered such note or Old Note within the 2nd anniversary after the  
Effective Date shall have its claim for a distribution from the WGI Creditor    
Trust on account of such Old Note discharged and shall be forever barred from   
asserting any such claim against the WGI Creditor Trust, any Reorganized Debtor 
or their respective property.                                                   

2.       RESOLUTION AND TREATMENT OF DISPUTED, CONTINGENT, AND
UNLIQUIDATED CLAIMS AND DISPUTED INTERESTS  

a.       PROSECUTION OF OBJECTIONS          

                 After the Confirmation Date, only the Debtors the Reorganized
Debtors shall have the authority to file objections, settle, compromise,        
withdraw or litigate to judgment objections to Claims, other than the Raytheon  
Asserted Claims and Disputed Claims in Class 7, with respect to which the       
authority to object, settle, compromise or litigate to judgment shall be        
transferred to the WGI Creditor Trust pursuant to Section 9.2 of this Plan. From
and after the Effective Date, the Reorganized Debtors or the Trustee, as        
applicable, may settle or compromise any Disputed Claim without approval of the 
Bankruptcy Court.                                                               

b.       NO DISTRIBUTIONS PENDING ALLOWANCE 

              Notwithstanding any other provision of the Plan or the WGI
Creditor Trust Agreement, no payments or distributions shall be made with       
respect to all or any portion of a Disputed Claim unless and until all          
objections to such Disputed Claim have been settled or withdrawn or have been   
determined by Final Order, and the Disputed Claim, or some portion thereof, has 
become an Allowed Claim.                                                        

                  c.       DISPUTED DISTRIBUTION RESERVE; RESERVE FOR SUBSEQUENT
                   DISTRIBUTIONS TO QUALIFYING CLASS 7 CREDITORS

                  Prior to making any distributions of Trust Assets, the Trustee
shall establish appropriate reserves for Disputed Class 7 Claims, to withhold   
from any such distributions an amount in Cash equal to 100% of distributions to 
which holders of Disputed Class 7 Claims would be entitled under the Plan as of 
such date if such Disputed Class 7 Claims were Allowed Claims in their Disputed 
Class 7 Claim Amount.                                                           

            d.       DISTRIBUTIONS AFTER ALLOWANCE OF CLASS 7 CLAIMS

              The Trustee shall make payments and distributions from the
reserve established for Disputed Class 7 Claims to each holder of a Disputed    
Class 7 Claim that has become an Allowed Class 7 Claim in accordance with the   
provisions of the WGI Creditor Trust Agreement. After the date that the order or
judgment of the Bankruptcy Court allowing such Claim becomes a Final Order, the 
Trustee shall distribute, subject to the WGI Creditor Trust Agreement, to the   
holder of such Claim any Cash in the reserve established for Disputed Class 7   
Claims that would have been distributed to the holder of such claim had such    
Claim been an Allowed Class 7 Claim.                                            

E.       POST-CONSUMMATION OPERATIONS OF THE DEBTORS                            

1.       CONTINUED CORPORATE EXISTENCE                        

                Following confirmation and consummation of the Plan, subject
to the Restructuring Transactions (if any), the Reorganized Debtors will        
continue to exist as separate corporate entities in accordance with the laws of 
their respective states of incorporation and pursuant to their respective       
certificates or articles of incorporation and bylaws in effect prior to the     
Effective Date, except to the extent such certificates or articles of           
incorporation and bylaws are amended under the Plan.                            

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2.       CANCELLATION OF OLD SECURITIES AND AGREEMENTS        

           On the Effective Date, except as otherwise provided for
herein, (a) the Old Securities and any other note, bond, indenture, or other    
instrument or document evidencing or creating any indebtedness or obligation of 
a Debtor, except such notes or other instruments evidencing indebtedness or     
obligations of a Debtor that are Reinstated or amended and restated under the   
Plan, shall be canceled, and (b) the obligations of the Debtors under any       
agreements, indentures or certificates of designations governing the Old        
Securities and any other note, bond, indenture or other instrument or document  
evidencing or creating any indebtedness or obligation of a Debtor, except such  
notes or other instruments evidencing indebtedness or obligations of a Debtor   
that are Reinstated or amended and restated under the Plan, as the case may be, 
shall be discharged.                                                            

3.       CERTIFICATES OF INCORPORATION AND BYLAWS             

              The certificate or articles of incorporation and bylaws of
each Debtor will be amended as necessary to satisfy the provisions of the Plan  
and the Bankruptcy Code and will include, among other things, pursuant to       
section 1123(a)(6) of the Bankruptcy Code, a provision prohibiting the issuance 
of non-voting equity securities, but only to the extent required by section     
1123(a)(6) of the Bankruptcy Code. The Articles of Incorporation and Bylaws of  
Reorganized WGI will include provisions allowing Mr. Dennis Washington to       
acquire, directly or indirectly, up to 40% of the New Common Shares, on a fully 
diluted basis, assuming exercise of the Washington Stock Options. SEE SECTION   
V.G. The amended Articles of Incorporation and By-laws of Reorganized WGI shall 
be in substantially the form attached to the Plan as Exhibits A and B           
respectively.                                                                   

4.       RESTRUCTURING TRANSACTIONS                           

              On or after the Effective Date, the applicable Reorganized
Debtors may enter into such transactions and may take such actions as may be    
necessary or appropriate to effect a corporate restructuring of their respective
businesses, to otherwise simplify the overall corporate structure of the        
Reorganized Debtors, or to reincorporate certain of the Subsidiary Debtors under
the laws of jurisdictions other than the laws of which the applicable Subsidiary
Debtors are presently incorporated. Such restructuring may include one or more  
mergers, consolidations, restructures, dispositions, liquidations, or           
dissolutions, as may be determined by the Debtors or Reorganized Debtors to be  
necessary or appropriate (collectively, the "Restructuring Transactions"). The  
actions to effect the Restructuring Transactions may include: (a) the execution 
and delivery of appropriate agreements or other documents of merger,            
consolidation, restructuring, disposition, liquidation, or dissolution          
containing terms that are consistent with the terms of the Plan and that satisfy
the applicable requirements of applicable state law and such other terms to     
which the applicable entities may agree; (b) the execution and delivery of      
appropriate instruments of transfer, assignment, assumption, or delegation of   
any asset, property, right, liability, duty, or obligation on terms consistent  
with the terms of the Plan and having such other terms to which the applicable  
entities may agree; (c) the filing of appropriate certificates or articles of   
merger, consolidation, or dissolution pursuant to applicable state law; and (d) 
all other actions that the applicable entities determine to be necessary or     
appropriate, including making filings or recordings that may be required by     
applicable state law in connection with such transactions. The Restructuring    
Transactions may include one or more mergers, consolidations, restructures,     
dispositions, liquidations, or dissolutions, as may be determined by the        
Reorganized Debtors to be necessary or appropriate to result in substantially   
all of the respective assets, properties, rights, liabilities, duties, and      
obligations of certain of the Reorganized Debtors vesting in one or more        
surviving, resulting, or acquiring corporations. In each case in which the      
surviving, resulting, or acquiring corporation in any such transaction is a     
successor to a Reorganized Debtor, such surviving, resulting, or acquiring      
corporation will perform the obligations of the applicable Reorganized Debtor   
pursuant to the Plan to pay or otherwise satisfy the Allowed Claims against such
Reorganized Debtor, except as provided in any contract, instrument, or other    
agreement or document effecting a disposition to such surviving, resulting, or  
acquiring corporation, which may provide that another Reorganized Debtor will   
perform such obligations.                                                       

F.       SUMMARY OF SECURITIES TO BE ISSUED IN CONNECTION WITH THE PLAN         

1.       NEW COMMON SHARES                                    

             As of the Effective Date, Reorganized WGI shall issue for
distribution in accordance with the terms of the Plan the New Common Shares to  
the holders of Allowed Claims in Class 6. The issuance of the New Common Shares 
and the distribution thereof to holders of Allowed Claims in Class 6 shall be   
exempt from registration under applicable securities laws pursuant to section   
1145(a) of the Bankruptcy Code.                                                 

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2.       REGISTRATION RIGHTS AGREEMENT                        

                 Without limiting the effect of section 1145 of the Bankruptcy
Code, Reorganized WGI will enter into a Registration Rights Agreement with each 
Allowed Class 6 Claim holder (a) who by virtue of holding New Common Shares to  
be distributed under the Plan and/or its relationship with Reorganized WGI holds
more than 10% of the New Common Shares or could reasonably be deemed to be an   
"affiliate" (as such term is used within the meaning of applicable securities   
laws) of Reorganized WGI (an "Affiliated Shareholder"), and (b) who requests in 
writing that Reorganized WGI execute such agreement. The Registration Rights    
Agreements shall contain certain shelf, demand and piggyback registration rights
for the benefit of the signatories thereto. Subject to the terms and conditions 
of the Registration Rights Agreement, Affiliated Stockholders holding more than 
15% of the New Common Stock subject to the Registration Rights Agreement        
("Registrable Securities") shall be entitled to request the registration of     
their shares by the Company. Each Affiliated Stockholder shall receive one such 
"demand" right; provided that, in the aggregate, the Affiliated Stockholders    
shall be entitled to no more than two demand registrations. Subject to the terms
and conditions of the Registration Rights Agreement, the Affiliated Stockholders
shall also have the right to include their Registrable Securities in            
registrations by the Company or require the Company to file and maintain the    
effectiveness of a Form S-3 shelf registration statement providing for an       
offering of Registrable Securities to be made on a continuous basis. The        
Registration Rights Agreement shall also contain customary provisions regarding 
the registration rights, including, but not limited to, registration procedures,
transfer restrictions, withdrawal rights, holdback agreements, registration     
expenses and indemnification. The Registration Rights Agreement shall be in     
substantially the form attached to the Plan as EXHIBIT D. Reorganized WGI will  
use reasonable commercial efforts to have the New Common Shares listed for      
trading on a national securities exchange.                                      

G.       EXIT FACILITY                                                          

                On the Effective Date, the Debtors anticipate that they will
enter into the Exit Facility. The Debtors anticipate that the Exit Facility will
be used to (a) repay amounts outstanding on the Effective Date under the DIP    
Facility, (b) make other payments required to be made on the Effective Date or  
the Distribution Date, including, but not limited to, the Initial Deposit, and  
(c) provide such additional borrowing capacity as is required by the Debtors and
the Subsidiaries following the Effective Date to maintain their operations. SEE 
SECTION V.L.1.(f). As of the date hereof, the Debtors have not obtained any     
commitment for Exit Financing, and as set forth in SECTION VI.N.2.(b), such a   
commitment and entering into such a facility is a condition to the Effective    
Date of the Plan.                                                               

H.       SUMMARY OF RELEASES UNDER THE PLAN                                     

1.       RELEASES BY DEBTORS                                  

                The Plan provides for the Debtors to release certain parties
from claims (if any) of the Debtors. Direct, non-derivative claims owned by     
creditors against such entities (if any) are not being released under the Plan, 
nor does the Plan provide for a discharge of any liabilities of any non-Debtor  
person or entity. See SECTION VI.O.2 for a description of the Plan's discharge  
provisions.                                                                     

               Pursuant to the Plan, as of the Effective Date, the Debtors
and Reorganized Debtors will be deemed to forever release, waive and discharge  
all claims, obligations, suits, judgments, damages, demands, debts, rights,     
causes of action and liabilities whatsoever in connection with or related to the
Debtors and the Subsidiaries, the Chapter 11 Cases or the Plan (other than the  
rights of the Debtors or Reorganized Debtors to enforce the Plan and the        
contracts, instruments, releases, indentures, and other agreements or documents 
delivered thereunder) whether liquidated or unliquidated, fixed or contingent,  
matured or unmatured, known or unknown, foreseen or unforseen, then existing or 
thereafter arising, in law, equity or otherwise that are based in whole or part 
on any act, omission, transaction, event or other occurrence taking place on or 
prior to the Effective Date in any way relating to the Debtors, the Reorganized 
Debtors or their Subsidiaries, the Chapter 11 Cases or the Plan, and that may be
asserted by or on behalf of the Debtors or their Estates or the Reorganized     
Debtors against (i) the Debtors' or Subsidiaries' present directors, officers,  
employees, agents and professionals as of the Petition Date, (ii) the holders of
Lender Claims, (iii) CSFB, as administrative agent, collateral agent and        
arranger under the Prepetition Senior Secured Credit Facility, (iv) Bank of     
Montreal as syndication agent under the Prepetition Senior Secured Credit       
Facility, (v) BoA and U.S. Bank as documentation agent under the Prepetition    
Senior Secured Credit Facility, (vi) the DIP Agent and the holders of DIP       
Facility Claims, (vii) the respective current professionals of the entities     
released in subclauses (i)-(vi) above acting in such capacity, except for those 
persons and entities listed on SCHEDULE 5.13 to the Plan against which claims   
shall not be released under the Plan.                                           

            The Debtors are unaware of any claims against any of the
parties to be released by the Debtors that the Debtors believe have any material
value to the Debtors' estates. Specifically, with respect to officers, directors
or other agents and professionals involved in the transaction with Raytheon, the
Debtors have concluded, after extensive investigation and analysis, that they   
believe that Raytheon committed a fraud upon the Company. Moreover, the Debtors 
believe that their directors and officers acted appropriately in all respects in
connection with the Raytheon Transaction.                                       

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               With respect to professionals engaged by the Company before
the Petition Date, including with respect to the Raytheon transaction, the      
Company's engagement agreements with such professionals contain broad           
indemnities granted by the Company in favor of such parties, which indemnities  
are typically required by professionals in engagement agreements. Officers and  
directors also have broad indemnities granted to them, which is typical for     
officers and directors of corporations. Under the Plan, certain Indemnification 
Obligations are being assumed, which means such obligations will become         
obligations of the Reorganized Debtors. SEE SECTION VI.J.4. The Debtors do not  
believe that any claims against the parties to be released by the Debtors (if   
any exist) would likely result in affirmative recoveries, because such parties  
would have the right to assert indemnity claims and offset those claims against 
their potential liability, whether or not such Indemnification Obligations are  
assumed under the Plan (as proposed), or rejected. SEE SECTION VI.J.4 for a     
discussion as to why the Debtors believe the Indemnification Obligations should 
be assumed. In the event that the Bankruptcy Court were to determine that       
Indemnification Obligations could not be assumed and must be rejected, the      
claims for indemnification by such parties, rather than being assumed and       
satisfied in the ordinary course of business, would be classified in Class 7,   
but such claim holders would retain the right to assert rights of setoff against
any prepetition claims asserted against them.                                   

           The Plan also provides for the "exculpation" of various
parties with respect to their actions during the Chapter 11 Cases and their     
efforts to have the Plan confirmed. SEE SECTION VI.O.4.                         

2.       RELEASES BY HOLDERS OF LENDER CLAIMS                 

                 Pursuant to the Plan, to the fullest extent permissible under
applicable law, as of the Effective Date, in consideration for the obligations  
of the Debtors and the Reorganized Debtors under the Plan and the Cash,         
securities, contracts, instruments, releases and other agreements or documents  
to be delivered in connection with the Plan, each of the Prepetition Secured    
Lenders, any individual, corporation or other entity that was at any time       
formerly a Lender and the DIP Lenders will be deemed to forever release, waive  
and discharge all claims, obligations, suits, judgments, damages, demands,      
debts, rights, causes of action and liabilities (other than the rights to       
enforce the Debtors' or the Reorganized Debtors' obligations under the Plan and 
the securities, contracts, instruments, releases and other agreements and       
documents delivered thereunder), whether liquidated or unliquidated, fixed or   
contingent, matured or unmatured, known or unknown, foreseen or unforseen, then 
existing or thereafter arising, in law, equity or otherwise that are based in   
whole or in part on any act, omission, transaction, event or other occurrence   
taking place on or prior to the Effective Date in any way relating to the       
Debtors or Subsidiaries, the Reorganized Debtors, the Chapter 11 Cases, or the  
Plan against (i) the Debtors, the Subsidiaries and the Reorganized Debtors, (ii)
the present directors, officers and employees of the Debtors or Subsidiaries as 
of the Effective Date, or (iii) their respective current professionals as of the
Effective Date (including the present and former officers, directors, employees,
shareholders and professionals of the foregoing), acting in such capacity,      
except for those persons and entities listed on SCHEDULE 5.13 to the Plan       
against which claims shall not be released under the Plan.                      

3.       INJUNCTION RELATED TO RELEASES                       

         As further provided in SECTION 12.11 of the Plan, the
Confirmation Order will enjoin the prosecution, whether directly, derivatively  
or otherwise, of any claim, obligation, suit, judgment, damage, demand, debt,   
right, cause of action, liability or interest released, discharged or terminated
pursuant to the Plan.                                                           

I.       COMPENSATION AND BENEFIT PROGRAMS                                      

                  Except and to the extent previously assumed by an order of the
Bankruptcy Court on or before the Confirmation Date, all employee compensation  
and benefit programs of the Debtors, including programs subject to sections 1114
and 1129(a)(13) of the Bankruptcy Code, entered into before or after the        
Petition Date and not since terminated, shall be deemed to be, and shall be     
treated as though they are, executory contracts that are assumed except for (i) 
executory contracts or plans specifically rejected pursuant to the Plan (to the 
extent such rejection does not violate sections 1114 and 1129(a)(13) of the     
Bankruptcy Code) and (ii) executory contracts or plans as have previously been  
rejected, are the subject of a motion to reject, or have been specifically      
waived by the beneficiaries of any plans or contracts; PROVIDED, HOWEVER, that  
the Debtors' obligations, if any, to pay all "retiree benefits" (as defined in  
section 1114(a) of the Bankruptcy Code) shall continue.                         

                 On the Effective Date, management and designated employees of
Reorganized WGI and the other Reorganized Debtors shall receive stock options   
which are more specifically described in the Management Option Plan, in         
substantially the form attached to the Plan as EXHIBIT C.                       

            The principal terms of the Management Option Plan are as
follows. Under the Management Option Plan, options to purchase up to 10% of the 
New Common Shares outstanding, on a fully diluted basis, shall be authorized to 
be granted. All options will                                                    

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vest over a 3 year period. One half of these options shall be issued on the     
Effective Date to members of existing management, as determined and to be       
announced prior to the Confirmation Hearing, with strike prices set based upon  
the value of the New Common Stock established in this Disclosure Statement. SEE 
SECTION XI.E. The remaining one half of the options issued under the Management 
Option Plan shall be available for issuance at the discretion of the Board of   
Directors of Reorganized WGI, with strike prices based upon then- current market
conditions as determined by the Board of Reorganized WGI.                       

J.       DIRECTORS AND OFFICERS OF REORGANIZED DEBTORS                          

1.       APPOINTMENT                                          

           The initial board of directors of Reorganized WGI shall
consist of nine (9) directors. Mr. Dennis Washington, Mr. Stephen Hanks and Mr. 
David Batchelder shall each be directors of Reorganized WGI with Mr. Washington 
serving as Chairman without cash compensation for at least two (2) years after  
the Effective Date so long as the Board desires him to do so. The Prepetition   
Secured Lenders shall be entitled to appoint six (6) directors. The Confirmation
Order may contain provisions providing for a staggered board for Reorganized    
WGI, as agreed to by WGI and the Prepetition Secured Lenders. The Prepetition   
Secured Lenders shall file with the Bankruptcy Court and give to WGI written    
notice of the identities of such members on a date that is not less than five   
(5) days prior to the Confirmation Hearing. The boards of directors and         
executive officers of the remaining Reorganized Debtors shall consist of        
directors and officers as determined by Reorganized WGI on the Effective Date or
thereafter.                                                                     

2.       TERMS                                                

               Reorganized WGI board members shall serve for initial terms
commencing on the Effective Date as determined be the Debtors and the           
Prepetition Secured Lenders and approved in the Confirmation Order.             

3.       VACANCIES                                            

                  Any vacancy in the directorship prior to the expiration of the
initial term (i) selected by the Prepetition Secured Lenders shall in the case  
of the resignation of such director, be filled by a person designated by such   
director as his/her replacement to serve out the remainder of the applicable    
term; and (ii) selected by WGI shall be filled by a person designated by the    
Chief Executive Officer of Reorganized WGI to serve out the remainder of the    
applicable term.                                                                

        4.       TREATMENT OF DIRECTOR AND OFFICER INDEMNIFICATION OBLIGATIONS
UNDER THE PLAN                              

                  Indemnification Obligations are defined in SECTION 1.51 of the
Plan as obligations of any of the Debtors or Subsidiaries to indemnify,         
reimburse or provide contribution to any present or former officer, director or 
employee, or any present or former professionals or advisors of the Debtors,    
pursuant to by-laws, articles of incorporation or otherwise as may be in        
existence immediately prior to the Petition Date, including, without limitation,
accountants, auditors, financial consultants, underwriters or attorneys, whether
pursuant to charter, by law, contract, statute or otherwise, regardless of      
whether the indemnification is owed in connection with a pre- petition or       
post-petition occurrence. Under the Plan, all Indemnification Obligations shall 
be treated as though they are executory contracts that are assumed pursuant to  
section 365 of the Bankruptcy Code under the Plan and such obligations shall    
remain unaffected and shall not be discharged or impaired hereby, except for the
indemnification claims of Raytheon or any of its subsidiaries, officers,        
directors, employees, agents or professionals or any party listed on SCHEDULE   
5.13 or SCHEDULE 6.3 to the Plan, which claims shall be deemed rejected pursuant
to SECTION 6.3 of the Plan. The Debtors believe the Indemnification Obligations 
to be assumed should be assumed because doing so is in the best interests of    
these estates, and because the Debtors do not believe that their assumption will
have a material adverse impact on the Reorganized Debtors. The Debtors believe  
that assuming these Indemnification Obligations is in the Debtors' best         
interests because the ability to retain management personnel, other employees,  
and professionals and advisors is critical to the ongoing viability of the      
Debtors. Maintaining standard indemnity agreements, which are common to large   
corporations, is necessary to be able to preserve employee morale and to ensure 
that key employees will not leave the Debtors' employ. Moreover, any director   
and officer liability insurance coverage in place prior to the Petition Date    
will remain in place during the Chapter 11 Cases and after the Effective Date.  
If the Indemnification Obligations are not assumed, Claims by indemnified       
parties would be General Unsecured Claims in Class 7, subject to claims of      
rights of setoff and/or recoupment.                                             

K.       REVESTING OF ASSETS                                                    

           Pursuant to section 1141(b) of the Bankruptcy Code, all
property of each Debtor's Estate, together with any property of each Debtor that
is not property of its Estate and that is not specifically disposed of pursuant 
to the Plan, shall revest in the applicable                                     

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Reorganized Debtor on the Effective Date. Thereafter, the Reorganized Debtors   
may operate their businesses and may use, acquire and dispose of property free  
of any restrictions of the Bankruptcy Code, the Bankruptcy Rules and the        
Bankruptcy Court. As of the Effective Date, all property of each Reorganized    
Debtor shall be free and clear of all Liens, Claims and Interests, except as    
specifically provided in the Plan or the Confirmation Order. Without limiting   
the generality of the foregoing, each Reorganized Debtor may, without           
application to or approval by the Bankruptcy Court, pay fees that it incurs     
after the Effective Date for professional services and expenses.                

L.       PRESERVATION OF RIGHTS OF ACTION                                       

                Except as otherwise provided in the Plan or the Confirmation
Order, or in any contract, instrument, release, indenture or other agreement    
entered into in connection with the Plan, in accordance with section 1123(b) of 
the Bankruptcy Code, the Reorganized Debtors shall retain and may enforce, sue  
on, settle or compromise (or decline to do any of the foregoing) all Litigation 
Claims that the Debtors or the Estates may hold against any Person or entity.   
Each Debtor or its successor(s) may pursue such retained Litigation Claims as   
appropriate, in accordance with the best interests of the Reorganized Debtor or 
its successor(s) who hold such rights. The Debtors do not believe that the      
Litigation Claims will have a material impact on the businesses or value of the 
Reorganized Debtors. The Debtors have not undertaken a detailed analysis of any 
potential preference, fraudulent transfer or other actions they may have under  
sections 544, 546, 547, 548 and 550 of the Bankruptcy Code (other than with     
respect to Raytheon).                                                           

              The failure of the Debtors to specifically list any claim,
right of action, suit, or proceeding herein or in the Plan does not, and will   
not be deemed to, constitute a waiver or release by the Debtors of such claim,  
right of action, suit, or proceeding, and the Reorganized Debtors will retain   
the right to pursue additional claims, rights of action, suits or proceedings.  
In addition, at any time before the Effective Date, notwithstanding anything in 
the Plan to the contrary, the Debtors or the Reorganized Debtors may settle some
or all of the Litigation Claims with the approval of the Bankruptcy Court       
pursuant to Fed. R. Bankr. P. 9019.                                             

M.       OTHER MATTERS                                                          

1.       TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES

                  Under section 365 of the Bankruptcy Code, the Debtors have the
right, subject to Bankruptcy Court approval, to assume or reject any executory  
contracts or unexpired leases. If the Debtors reject an executory contract or   
unexpired lease that was entered into before the Petition Date, the contract or 
lease will be treated as if it had been breached on the date immediately        
preceding the Petition Date, and the other party to the agreement will have an  
Impaired Unsecured Claim for damages incurred as a result of the rejection. In  
the case of rejection of employment severance agreements and real property      
leases, damages are subject to certain limitations imposed by sections 365 and  
502 of the Bankruptcy Code.                                                     

a.       ASSUMED CONTRACTS AND LEASES       

                 Except as otherwise provided in the Plan, or in any contract,
instrument, release, indenture or other agreement or document entered into in   
connection with the Plan, as of the Effective Date each Debtor shall be deemed  
to have assumed each executory contract and unexpired lease to which it is a    
party, unless such contract or lease (i) was previously assumed or rejected by  
such Debtor, (ii) previously expired or terminated pursuant to its own terms,   
(iii) is the subject of a motion pending before the Bankruptcy Court as of the  
Confirmation Date to assume or reject such contract or lease or (iv) is listed  
on SCHEDULE 6.3 attached to the Plan as being an executory contract or unexpired
lease to be rejected, PROVIDED, HOWEVER, that the Debtors reserve their right,  
at any time prior to the Confirmation Date, to amend SCHEDULE 6.3 to delete any 
unexpired lease or executory contract therefrom or add any unexpired lease or   
executory contract thereto. To the extent that an executory contract or         
unexpired lease is not listed on SCHEDULE 6.3, such executory contract or       
unexpired lease shall be deemed assumed. The Confirmation Order shall constitute
an order of the Bankruptcy Court under section 365 of the Bankruptcy Code       
approving the contract and lease assumptions described above, as of the         
Effective Date.                                                                 

               Each executory contract and unexpired lease that is assumed
and relates to the use, ability to acquire, or occupancy of real property shall 
include (i) all modifications, amendments, supplements, restatements, or other  
agreements made directly or indirectly by any agreement, instrument, or other   
document that in any manner affect such executory contract or unexpired lease   
and (ii) all executory contracts or unexpired leases appurtenant to the         
premises, including all easements, licenses, permits, rights, privileges,       
immunities, options, rights of first refusal, powers, uses, usufructs,          
reciprocal easement agreements, vaults, tunnel or bridge agreements or          
franchises, and any other interests in real estate or rights IN REM related to  
such premises, unless any of the foregoing agreements has been rejected pursuant
to an order of the Bankruptcy Court.                                            

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            b.       PAYMENTS RELATED TO ASSUMPTION OF CONTRACTS AND
LEASES                    

             Any monetary amounts by which each executory contract and
unexpired lease to be assumed pursuant to the Plan is in default will be        
satisfied, under section 365(b)(1) of the Bankruptcy Code, at the option of the 
Debtor party assuming such contract or lease, by Cure. If there is a dispute    
regarding (i) the nature or amount of any Cure, (ii) the ability of a           
Reorganized Debtor or any assignee to provide "adequate assurance of future     
performance" (within the meaning of section 365 of the Bankruptcy Code) under   
the contract or lease to be assumed, or (iii) any other matter pertaining to    
assumption, Cure will occur following the entry of a Final Order resolving the  
dispute and approving the assumption or assumption and assignment, as the case  
may be.                                                                         

c.       REJECTED CONTRACTS AND LEASES      

                On the Effective Date, each executory contract and unexpired
lease listed on SCHEDULE 6.3 to the Plan shall be rejected pursuant to section  
365 of the Bankruptcy Code. Each contract or lease listed on SCHEDULE 6.3 shall 
be rejected only to the extent that any such contract or lease constitutes an   
executory contract or unexpired lease; PROVIDED, HOWEVER, that the Debtors      
reserve their right, at any time prior to the Confirmation Date, to amend       
SCHEDULE 6.3 to delete any unexpired lease or executory contract therefrom or   
add any unexpired lease or executory contract thereto. To the extent that an    
executory contract or unexpired lease is not listed on SCHEDULE 6.3, such       
executory contract or unexpired lease shall be deemed assumed. Listing a        
contract or lease on SCHEDULE 6.3 shall not constitute an admission by a Debtor 
nor a Reorganized Debtor that such contract or lease is an executory contract or
unexpired lease or that such Debtor or Reorganized Debtor has any liability     
thereunder. The Confirmation Order shall constitute an order of the Bankruptcy  
Court approving the rejections described above, pursuant to section 365 of the  
Bankruptcy Code, as of the Effective Date.                                      

d.       REJECTION DAMAGES BAR DATE         

         If the rejection by a Debtor, pursuant to the Plan or
otherwise, of an executory contract or unexpired lease results in a Claim, then 
such Claim shall be forever barred and shall not be enforceable against any     
Debtor or Reorganized Debtor or the properties of any of them unless a proof of 
claim is filed with the clerk of the Bankruptcy Court and served upon counsel to
the Debtors, counsel to the Creditors' Committee, within thirty (30) days after 
service of the earlier of (i) notice of the Confirmation Order, or (ii) other   
notice that the executory contract or unexpired lease has been rejected.        

         If any party to a lease or contract has any questions
regarding the status or treatment of such lease or contract, please call the    
following the telephone number: (866) 251-5464.                                 

    2.       SPECIAL PROVISIONS FOR WARRANTY AND INDEMNITY OBLIGATIONS
ARISING OUT OF COMPLETED PROJECTS           

             Notwithstanding anything to the contrary in the Plan, all
Completed Projects and all executory obligations thereunder (including warranty 
and/or indemnity obligations), other than those Completed Projects explicitly   
set forth on Schedule 6.5 to the Plan, shall be treated as executory contracts  
that are rejected pursuant to section 365 of the Bankruptcy Code. Those         
Completed Projects and all executory obligations thereunder (including warranty 
and/or indemnity obligations) explicitly set forth on Schedule 6.5 to the Plan  
shall be treated as executory contracts that are assumed pursuant to Section 365
of the Bankruptcy Code, and obligations thereunder shall be satisfied in the    
ordinary course of business. The Debtors reserve the right to amend Schedule 6.5
to the Plan to delete or add any Completed Project thereto, at any time prior to
the Confirmation Date. The fact that a Completed Project is listed on Schedule  
6.5 to the Plan shall not constitute an admission by a Debtor or a Reorganized  
Debtor that such Completed Project is an executory contract or that a Debtor or 
Reorganized Debtor has any liability thereunder.                                

3.       ADMINISTRATIVE CLAIMS                                

              All requests for payment of an Administrative Claim (other
than as set forth in Sections 3.1 and 12.1 of the Plan) must be filed with the  
Bankruptcy Court and served on counsel for the Debtors and counsel for the      
Trustee no later than forty-five (45) days after the Effective Date. Unless the 
Debtors object to an Administrative Claim within forty-five (45) Business Days  
after receipt, such Administrative Claim shall be deemed allowed in the amount  
requested. In the event that the Debtors object to an Administrative Claim, the 
Bankruptcy Court shall determine the Allowed amount of such Administrative      
Claim. Notwithstanding the foregoing, no request for payment of an              
Administrative Claim need be filed with respect to an Administrative Claim which
is paid or payable by a Debtor in the ordinary course of business.              

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4.       PROFESSIONAL FEE CLAIMS                              

           All final requests for compensation or reimbursement of
Professional Fees pursuant to sections 327, 328, 330, 331, 503(b) or 1103 of the
Bankruptcy Code for services rendered to the Debtors or the Creditors' Committee
prior to the Effective Date and Substantial Contribution Claims under section   
503(b)(4) of the Bankruptcy Code must be filed and served on the Reorganized    
Debtors and their counsel no later than 60 days after the Effective Date, unless
otherwise ordered by the Bankruptcy Court. Objections to applications of such   
Professionals or other entities for compensation or reimbursement of expenses   
must be filed and served on the Reorganized Debtors and their counsel and the   
requesting Professional or other entity no later than 60 days (or such longer   
period as may be allowed by order of the Bankruptcy Court) after the date on    
which the applicable application for compensation or reimbursement was served.  

5.       WITHHOLDING AND REPORTING REQUIREMENTS               

                In connection with the Plan and all distributions hereunder,
the Disbursing Agent shall, to the extent applicable, comply with all tax       
withholding and reporting requirements imposed by any federal, state,           
provincial, local or foreign taxing authority, and all distributions hereunder  
shall be subject to any such withholding and reporting requirements. The        
Disbursing Agent shall be authorized to take any and all actions that may be    
necessary or appropriate to comply with such withholding and reporting          
requirements. Notwithstanding any other provision of the Plan (i) each holder of
an Allowed Claim that is to receive a distribution of New Common Shares pursuant
to the Plan shall have sole and exclusive responsibility for the satisfaction   
and payment of any tax obligations imposed by any governmental unit, including  
income, withholding and other tax obligations, on account of such distribution, 
and (ii) no distribution shall be made to or on behalf of such holder pursuant  
to the Plan unless and until such holder has made arrangements satisfactory to  
the Disbursing Agent for the payment and satisfaction of such tax obligations.  
Any New Common Shares to be distributed pursuant to the Plan shall, pending the 
implementation of such arrangements, be treated as an undeliverable distribution
pursuant to SECTION 7.7 of the Plan.                                            

6.       SETOFFS                                              

                  The Reorganized Debtors may, but shall not be required to, set
off against any Claim and the payments or other distributions to be made        
pursuant to the Plan in respect of such Claim, claims of any nature whatsoever  
that the Debtors or Reorganized Debtors may have against the holder of such     
Claim; PROVIDED, HOWEVER, that neither the failure to do so nor the allowance of
any Claim hereunder shall constitute a waiver or release by the Reorganized     
Debtors of any such claim that the Debtors or Reorganized Debtors may have      
against such holder. Notwithstanding anything to the contrary, the Debtors and  
Reorganized Debtors will not exercise any right of setoff against any Lender,   
any agents under the Prepetition Senior Secured Credit Facility or the DIP      
Facility, or the DIP Lenders.                                                   

7.       CONTINUATION OF CERTAIN ORDERS                       

             Notwithstanding anything in the Plan to the contrary, the
Debtors will continue to pay any Claims authorized to be paid by an order of the
Bankruptcy Court during the Chapter 11 Cases, pursuant to the terms and         
conditions of any such order.                                                   

N.       CONFIRMATION AND/OR CONSUMMATION                                       

                  Described below are certain important considerations under the
Bankruptcy Code in connection with confirmation of the Plan.                    

1.       REQUIREMENTS FOR CONFIRMATION OF THE PLAN            

         The Bankruptcy Court will determine at the hearing on
confirmation of the Plan (the "Confirmation Hearing") whether the following     
requirements for confirmation, set forth in section 1129 of the Bankruptcy Code,
have been satisfied:                                                            

                a.       The Plan complies with the applicable provisions of
the Bankruptcy Code.      

          b.       The Debtors have complied with the applicable
        provisions of the Bankruptcy Code.

                c.       The Plan has been proposed in good faith and not by
 any means forbidden by law.

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                d.       Any payment made or promised by the Debtors or by a
                           person issuing securities or acquiring property under
                         the Plan for services or for costs and expenses in,
                        or in connection with, the Chapter 11 Cases, or in
                          connection with the Plan and incident to the Chapter
                           11 Cases, has been disclosed to the Bankruptcy Court,
                          and any such payment made before confirmation of the
                           Plan is reasonable, or if such payment is to be fixed
                     after confirmation of the Plan, such payment is
                        subject to the approval of the Bankruptcy Court as
reasonable.               

            e.       The Debtors have disclosed (i) the identity and
                           affiliations of (x) any individual proposed to serve,
                    after confirmation of the Plan, as a director,
                   officer, or voting trustee of the Reorganized
               Debtors, (y) any affiliate of the Debtors
                        participating in a joint plan with the Debtors, or
                          (z) any successor to the Debtors under the Plan (and
                           the appointment to, or continuance in, such office of
                         such individual(s) is consistent with the interests
                       of Creditors and Interest holders and with public
                        policy), and (ii) the identity of any insider that
                         will be employed or retained by the Debtors and the
                  nature of any compensation for such insider.

               f.       With respect to each Class of Claims or Interests,
                         each Impaired Creditor and Impaired Interest holder
                     either has accepted the Plan or will receive or
                       retain under the Plan on account of the Claims or
                         Interests held by such entity, property of a value,
                         as of the Effective Date, that is not less than the
                        amount that such entity would receive or retain if
                    the Debtors were liquidated on such date under
                         Chapter 7 of the Bankruptcy Code. SEE SECTION XI.C.

             g.       The Plan provides that Administrative Claims and
                         Priority Claims other than Priority Tax Claims will
                    be paid in full on the Effective Date and that
                         Priority Tax Claims will receive on account of such
                      Claims deferred cash payments, over a period not
                         exceeding six years after the date of assessment of
                        such Claims, of a value, as of the Effective Date,
                           equal to the Allowed Amount of such Claims, except to
                      the extent that the holder of any such Claim has
                  agreed to a different treatment. SEE SECTION
VI.C.2.(a).               

                h.       If a Class of Claims is Impaired under the Plan, at
                         least one Class of Impaired Claims has accepted the
                          Plan, determined without including any acceptance of
                        the Plan by insiders holding Claims in such Class.

                  i.       Confirmation of the Plan is not likely to be followed
                           by the liquidation, or the need for further financial
                        reorganization, of the Debtors or any successor to
                         the Debtors under the Plan, unless such liquidation
                    or reorganization is proposed in the Plan. SEE
SECTION XI.A.             

             j.       The Plan provides for the continuation after the
                        Effective Date of all retiree benefits, if any, at
               the level established pursuant to section
                        1114(e)(1)(B) or 1114(g) of the Bankruptcy Code at
                         any time prior to confirmation of the Plan, for the
                       duration of the period the Debtors have obligated
          themselves to provide such benefits.

                The Debtors believe that, upon receipt of the votes required
to confirm the Plan, the Plan will satisfy all the statutory requirements of    
Chapter 11 of the Bankruptcy Code, that the Debtors have complied or will have  
complied with all of the requirements of Chapter 11, and that the Plan has been 
proposed and submitted to the Bankruptcy Court in good faith.                   

2.       CONDITIONS TO CONFIRMATION AND CONSUMMATION          

a.       CONDITIONS TO CONFIRMATION         

               The following are conditions precedent to the occurrence of
the Confirmation Date: (i) the entry of an order finding that the Disclosure    
Statement contains adequate information pursuant to section 1125 of the         
Bankruptcy Code, and (ii) the proposed Confirmation Order shall be in form and  
substance acceptable to the Debtors and the Agent under the Prepetition Senior  
Secured Credit Facility.                                                        

b.       CONDITIONS TO EFFECTIVE DATE       

               The following are conditions precedent to the occurrence of
the Effective Date, each of which may be satisfied or waived in accordance with 
SECTION 10.2 of the Plan:                                                       

                     (i)      The Confirmation Order shall have been
                                    entered and become a Final Order in form and
 substance

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                                  reasonably satisfactory to the Debtors and
                              the Agent under the Prepetition Senior
                          Secured Credit Facility and shall:

                                         (1)      provide that the Debtors
                                                     and Reorganized Debtors are
                                                    authorized and directed to
                                                    take all actions necessary
                                                 or appropriate to enter
                                             into, implement and
                                                   consummate the contracts,
                                                instruments, releases,
                                                leases, indentures and
                                             other agreements or
                                              documents created in
                                                     connection with the Plan or
                                           the Restructuring
                                       Transactions;

                                          (2)      authorize the issuance of
                                                    the New Common Shares, the
                                                   Washington Stock Options,
                                                 and Management Options;

                                         (3)      find that the New Common
                                                 Shares issued under the
                                                     Plan in exchange for Claims
                                                 against the Debtors are
                                                  exempt from registration
                                                     under the Securities Act of
                                                  1933 pursuant to section
                                                     1145 of the Bankruptcy Code
                                                   except to the extent that
                                                   holders of the New Common
                                                    Shares are "underwriters,"
                                                    as that term is defined in
                                             section 1145 of the
                                          Bankruptcy Code.

                         (ii)     The Reorganized Debtors shall have entered
               into the Exit Facility;

                     (iii)    All Plan Exhibits shall be in form and
                              substance reasonably acceptable to the
                                   Debtors and the Agent under the Prepetition
                                Senior Secured Credit Facility and shall
                         have been executed and delivered.

                    (iv)     All actions, documents and agreements
                                  necessary to implement the Plan shall have
                  been effected or executed.

c.       WAIVER OF CONDITIONS               

                Each of the conditions set forth in SECTION 10.2 of the Plan
may be waived in whole or in part by the Debtors with the written consent of the
Agent under the Prepetition Senior Secured Credit Facility, without any other   
notice to parties in interest or the Bankruptcy Court and without a hearing. The
failure to satisfy or waive any condition to the Effective Date may be asserted 
by the Debtors or Reorganized Debtors regardless of the circumstances giving    
rise to the failure of such condition to be satisfied (including any action or  
inaction by a Debtor or Reorganized Debtor). The failure of a Debtor or         
Reorganized Debtor to exercise any of the foregoing rights shall not be deemed a
waiver of any other rights, and each such right shall be deemed an ongoing right
that may be asserted at any time.                                               

O.      EFFECTS OF CONFIRMATION                                                 

1.       BINDING EFFECT                                       

                 The Plan will be binding upon and inure to the benefit of the
Debtors, all present and former holders of Claims against the Debtors, whether  
or not such holders will receive or retain any property or interest in property 
under the Plan, their respective successors and assigns, including, but not     
limited to, the Reorganized Debtors, and all parties-in-interest in the Chapter 
11 Cases.                                                                       

2.       DISCHARGE OF THE DEBTORS                             

              (a)      Except as provided in the Confirmation Order, the
rights afforded under the Plan and the treatment of Claims and Interests under  
the Plan shall be in exchange for and in complete satisfaction, discharge and   
release of all Claims and termination of all WGI Interests, including any       
interest accrued on Claims from the Petition Date. Except as provided in the    
Confirmation Order, Confirmation shall (a) discharge the Debtors from all Claims
and other debts that arose before the Confirmation Date and all debts of the    
kind specified in section 502(g), 502(h) or 502(i) of the Bankruptcy Code,      
whether or not (i) a proof of claim based on such debt is filed or deemed filed 
pursuant to section 501 of the Bankruptcy Code, (ii) a Claim based on such debt 
is allowed pursuant to section 502 of the Bankruptcy Code or (iii) the holder of
a Claim based on such debt has accepted the Plan; and (b) terminate all         
Interests and other rights of equity security holders in WGI.                   

               (b)      As of the Confirmation Date, except as provided in
the Plan or the Confirmation Order, all entities shall be precluded from        
asserting against the Debtors, the Reorganized Debtors, their successors or     
their property, any other or further claims, debts, rights, causes of action,   
liabilities or equity interests based upon any act, omission, transaction or    
other activity of any nature that                                               

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occurred prior to the Confirmation Date. In accordance with the foregoing,      
except as provided in the Plan of the Confirmation Order, the Confirmation Order
shall be a judicial determination of discharge of all such rights of equity     
security holders in WGI, pursuant to sections 524 and 1141 of the Bankruptcy    
Code, and such discharge shall void any judgment obtained against the Debtors at
any time, to the extent that such judgment relates to a discharged Claim or WGI 
Interest.                                                                       

               The Plan does not provide for a discharge of any non-Debtor
party. See SECTION VI.H for a description of release and indemnification        
provisions. The Plan does provide for certain Indemnification Obligations to be 
assumed, which means that if third party claims against non-Debtors are pursued,
such non-Debtors that have rights to be indemnified by the Debtors for their    
costs or liabilities (if any) will continue to be indemnified by the Reorganized
Debtors.                                                                        

3.       PERMANENT INJUNCTION                                 

                Except as provided in the Plan or the Confirmation Order, as
of the Confirmation Date, all entities that have held, currently hold or may    
hold a Claim or other debt or liability that is discharged or an Interest or    
other right of an equity security holder that is terminated pursuant to the     
terms of the Plan are permanently enjoined from the taking of any of the        
following actions against the Debtors, the Reorganized Debtors or their property
on account of any such discharged Claims, debts or liabilities or terminated    
interests or rights: (a) commencing or continuing, in any manner or in any      
place, any action or other proceeding: (b) enforcing, attaching, collecting or  
recovering in any manner any judgment, award, decree or order; (c) creating,    
perfecting or enforcing any lien or encumbrance; (d) asserting a setoff, right  
of subrogation or recoupment of any kind against any debt, liability or         
obligation due to the Debtors and (e) commencing or continuing any action, in   
any manner, in any place that does not comply with or is inconsistent with the  
provisions of the Plan.                                                         

          As of the Effective Date, all entities that have held,
currently hold or may hold a claim, demand, debt, right, cause of action or     
liability that is released pursuant to SECTION 5.13 of the Plan are permanently 
enjoined from taking any of the following actions on account of such released   
claims, obligations, suits, judgments, damages, demands, debts, rights, causes  
of action or liabilities: (a) commencing or continuing in any manner any action 
or other proceeding; (b) enforcing, attaching, collecting or recovering in any  
manner any judgment, award, decree or order; (c) creating, perfecting or        
enforcing any lien or encumbrance: (d) asserting a setoff, right of subrogation 
or recoupment of any kind against any debt, liability or obligation due to any  
released entity; and (e) commencing or continuing any action, in any manner, in 
any place that does not comply with or is inconsistent with the provisions of   
the Plan.                                                                       

                  By accepting distribution pursuant to the Plan, each holder of
an Allowed Claim or Allowed Interest receiving distributions pursuant to the    
Plan will be deemed to have specifically consented to the injunctions set forth 
in SECTION 12.11 of the Plan.                                                   

4.       EXCULPATION AND LIMITATION ON LIABILITY; INDEMNITY   

                 Neither the Debtors, Reorganized Debtors, Prepetition Secured
Lenders, Creditors' Committee, DIP Lenders, or any of their respective present  
or former members, officers, directors, employees, advisors, attorneys, or      
agents, shall have or incur any liability to any holder of a Claim or an        
Interest, or any other party in interest, or any of their respective agents,    
employees, representatives, financial advisors, attorneys, or affiliates, or any
of their successors or assigns, for any act or omission in connection with,     
relating to, or arising out of, the Chapter 11 Case, formulating, negotiating or
implementing the Plan, the solicitation of acceptances of the Plan, the pursuit 
of confirmation of the Plan, the confirmation of the Plan, the consummation of  
the Plan, or the administration of the Plan or the property to be distributed   
under the Plan, except for their willful misconduct, and in all respects shall  
be entitled to reasonably rely upon the advice of counsel with respect to their 
duties and responsibilities under the Plan.                                     

                 Notwithstanding any other provision of the Plan, no holder of
a Claim or Interest, no other party in interest, none of their respective       
agents, employees, representatives, financial advisors, attorneys, or           
affiliates, and no successors or assigns of the foregoing, shall have any right 
of action against any Debtor or Reorganized Debtor, the Creditors' Committee,   
the Prepetition Secured Lenders, the DIP Lenders, nor any of their respective   
present or former members, officers, directors, employees, advisors, attorneys, 
for any act or omission in connection with, relating to, or arising out of, the 
Chapter 11 Cases, formulating, negotiating or implementing the Plan,            
solicitation of acceptances of the Plan, the pursuit of confirmation of the     
Plan, the consummation of the Plan, the confirmation of the Plan, or the        
administration of the Plan or the property to be distributed under the Plan,    
except for their willful misconduct.                                            

               The foregoing exculpation and limitation on liability shall
not, however, limit, abridge, or otherwise affect the rights of the Reorganized 
Debtors to enforce, sue on, settle, or compromise the Litigation Claims retained
pursuant to SECTION 5.10 of the Plan.                                           

P.       RETENTION OF JURISDICTION                                              

                Pursuant to sections 105(a) and 1142 of the Bankruptcy Code,
and notwithstanding entry of the Confirmation Order and                         

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occurrence of the Effective Date, the Bankruptcy Court will retain exclusive    
jurisdiction over all matters arising out of, and related to, the Chapter 11    
Cases and the Plan, including, among other things, jurisdiction to:             

             a.       Allow, disallow, determine, liquidate, classify,
                      estimate or establish the priority or secured or
                   unsecured status of any Claim or Interest not
                     otherwise allowed under the Plan, including the
                  resolution of any request for payment of any
                    Administrative Claim and the resolution of any
                          objections to the allowance or priority of Claims or
Interests;                

                 b.       Hear and determine all applications for compensation
                          and reimbursement of expenses of Professionals under
                           the Plan or under sections 330, 331, 503(b), 1103 and
                           1129(a)(4) of the Bankruptcy Code; PROVIDED, HOWEVER,
                         that from and after the Effective Date, the payment
              of the fees and expenses of the retained
                       Professionals of the Reorganized Debtors shall be
                           made in the ordinary course of business and shall not
                         be subject to the approval of the Bankruptcy Court;

               c.       Hear and determine all matters with respect to the
                          assumption or rejection of any executory contract or
                          unexpired lease to which a Debtor is a party or with
                         respect to which a Debtor may be liable, including,
                        if necessary, the nature or amount of any required
                        Cure or the liquidation or allowance of any Claims
arising therefrom;        

             d.       Effectuate performance of and payments under the
provisions of the Plan;   

                  e.       Hear and determine any and all adversary proceedings,
                       motions, applications, and contested or litigated
                       matters arising out of, under, or related to, the
Chapter 11 Case;          

                 f.       Enter such orders as may be necessary or appropriate
                         to execute, implement, or consummate the provisions
                           of the Plan and all contracts, instruments, releases,
                  and other agreements or documents created in
                           connection with the Plan, the Disclosure Statement or
the Confirmation Order;   

              g.       Hear and determine disputes arising in connection
              with the interpretation, implementation,
                         consummation, or enforcement of the Plan, including
                     disputes arising under agreements, documents or
                       instruments executed in connection with the Plan;

             h.       Consider any modifications of the Plan, cure any
                           defect or omission, or reconcile any inconsistency in
                           any order of the Bankruptcy Court, including, without
         limitation, the Confirmation Order;

                 i.       Issue injunctions, enter and implement other orders,
                       or take such other actions as may be necessary or
                        appropriate to restrain interference by any entity
                          with implementation, consummation, or enforcement of
         the Plan or the Confirmation Order;

                j.       Enter and implement such orders as may be necessary
                         or appropriate if the Confirmation Order is for any
                    reason reversed, stayed, revoked, modified, or
vacated;                  

                 k.       Hear and determine any matters arising in connection
                  with or relating to the Plan, the Disclosure
                         Statement, the Confirmation Order, or any contract,
                         instrument, release, or other agreement or document
                         created in connection with the Plan, the Disclosure
          Statement or the Confirmation Order;

                  l.       Enforce all orders, judgments, injunctions, releases,
                           exculpations, indemnifications and rulings entered in
          connection with the Chapter 11 Case;

            m.       Except as otherwise limited herein, recover all
                        assets of the Debtors and property of the Debtors'
Estates, wherever located;

                n.       Hear and determine matters concerning state, local,
                        and federal taxes in accordance with sections 346,
           505, and 1146 of the Bankruptcy Code;

          o.       Hear and determine all disputes involving the
                 existence, nature, or scope of the Debtors'
discharge;                

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            p.       Hear and determine such other matters as may be
                     provided in the Confirmation Order or as may be
                 authorized under, or not inconsistent with,
            provisions of the Bankruptcy Code; and

              q.       Enter a final decree closing the Chapter 11 Case.

Q.       PAYMENT OF STATUTORY FEES                                              

                Under the Plan, all fees payable pursuant to Section 1930 of
title 28 of the United States Code, as determined by the Bankruptcy Court at the
Confirmation Hearing will be paid on or before the Effective Date. After the    
Effective Date, the Reorganized Debtors shall pay all required fees pursuant to 
Section 1930 of title 28 of the United States Code or any other statutory       
requirement and comply with all statutory reporting requirements.               

XII.  WGI CREDITOR TRUST  

A.       APPOINTMENT OF TRUSTEE                                                 

                 The Trustee for the WGI Creditor Trust shall be designated by
the Creditors' Committee with the reasonable consent of the Agent under the     
Prepetition Senior Secured Credit Facility and the Debtors. Specifically, the   
Creditors' Committee shall file a notice on a date that is not less than five   
(5) days prior to the Confirmation Hearing designating the Person whom they have
selected as Trustee and seeking approval of such designation. Any dispute       
regarding the designation of the Trustee shall be resolved by the Bankruptcy    
Court. If approved by the Bankruptcy Court, the Person so designated shall      
become the Trustee on the Effective Date. The Trustee shall have and perform all
of the duties, responsibilities, rights and obligations set forth in the WGI    
Creditor Trust Agreement.                                                       

B.       TRANSFER OF TRUST ASSETS TO THE WGI CREDITOR TRUST                     

              The Trust Assets are comprised of the (i) Initial Deposit;
(ii) the Raytheon Claims; and (iii) all of the Debtors' rights and standing to  
contest the Raytheon Asserted Claims and all other Disputed Claims in Class 7 on
any basis and (iv) any and all proceeds of the foregoing and interest actually  
earned with respect thereto. On the Effective Date, the Debtors shall transfer  
and shall be deemed to have irrevocably transferred to the WGI Creditor Trust,  
for and on behalf of the beneficiaries of the Trust, the Trust Assets (subject  
to the obligation of the WGI Creditor Trust to pay the Reimbursement Obligation 
as set forth in SECTION 9.6 of the Plan).                                       

C.       THE WGI CREDITOR TRUST                                                 

                  Without any further action of the directors or shareholders of
the Debtors, on the Effective Date, the WGI Creditor Trust Agreement,           
substantially in the form of Exhibit E to the Plan, shall become effective. The 
Trustee shall accept the WGI Creditor Trust and sign the WGI Creditor Trust     
Agreement on the Effective Date and the WGI Creditor Trust will then be deemed  
created and effective.                                                          

           The Trustee shall have full authority to take any steps
necessary to administer the WGI Creditor Trust Agreement, including, without    
limitation, the duty and obligation to liquidate Trust Assets, to make          
distributions therefrom to the holders of Allowed Class 7 Claims and, if        
authorized by majority vote of those members of the Trust Advisory Board        
authorized to vote, to pursue and settle any of the Raytheon Claims, the        
Raytheon Asserted Claims and other Disputed Claims in Class 7. Upon such        
transfer, the Debtors, the Disbursing Agent and the Reorganized Debtors shall   
have no other further rights or obligations with respect thereto.               

                All costs and expenses associated with the administration of
the WGI Creditor Trust, including those rights, obligations and duties described
in SECTION 9.3 of the Plan, shall be the responsibility of and paid by the WGI  
Creditor Trust. Notwithstanding the foregoing, the Reorganized Debtors shall    
make available to the Trustee reasonable access during normal business hours,   
upon reasonable notice, to personnel and books and records of the Reorganized   
Debtors to representatives of the WGI Creditor Trust to enable the Trustee to   
perform the Trustee's tasks under the WGI Creditor Trust Agreement and the Plan;
PROVIDED, HOWEVER, that the Reorganized Debtors will not be required to make    
expenditures in response to such requests determined by them to be unreasonable.

            The Trustee may retain such law firms, accounting firms,
experts, advisors, consultants, investigators, appraisers, auctioneers or other 
professionals as it may deem necessary, in its sole discretion, to aid in the   
performance of its responsibilities pursuant to the terms of the Plan including,
without limitation, the liquidation and distribution of Trust Assets.           

                For federal income tax purposes, it is intended that the WGI
Creditor Trust be classified as a liquidating trust under section 301.7701-4 of 
the Procedure and Administration Regulations and that such trust is owned by its
beneficiaries. Accordingly, for federal income tax purposes, it is intended that
the beneficiaries be treated as if they had received a distribution of an       
undivided interest                                                              

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in the Trust Assets and then contributed such interests to the WGI Creditor     
Trust.                                                                          

                  The Trustee shall be responsible for filing all federal, state
and local tax returns for the WGI Creditor Trust.                               

D.       THE TRUST ADVISORY BOARD                                               

           The Trust Advisory Board will be comprised of three (3)
members, all of which shall be designated by the Creditors' Committee with the  
reasonable consent of the Agent under the Prepetition Senior Secured Credit     
Facility and the Debtors. The Debtors will give written notice of the identity  
of each member and file such notice with the Bankruptcy Court on a date that is 
not less than five (5) days prior to the Confirmation Hearing. Any dispute      
regarding the designation of the members of the Trust Advisory Board shall be   
resolved by the Bankruptcy Court.                                               

              The Trust Advisory Board shall adopt such bylaws as it may
deem appropriate. The Trustee shall consult regularly with the Trust Advisory   
Board when carrying out the purpose and intent of the WGI Creditor Trust.       
Members of the Trust Advisory Board shall be entitled to compensation in        
accordance with the Trust Agreement and to reimbursement of the reasonable and  
necessary expenses incurred by them in carrying out the purpose of the Trust    
Advisory Board. Reimbursement of the reasonable and necessary expenses of the   
members of the Trust Advisory Board and their compensation to the extent        
provided for in the Trust Agreement shall be payable by the WGI Creditor Trust. 

                 In the case of an inability or unwillingness of any member of
the Trust Advisory Board to serve, such member shall be replaced by designation 
of the remaining members of the Trust Advisory Board. If any position on the    
Trust Advisory Board remains vacant for more than thirty (30) days, such vacancy
shall be filled within fifteen (15) days thereafter by the designation of the   
Trustee without the requirement of a vote by the other members of the Trust     
Advisory Board.                                                                 

               Upon the certification by the Trustee that all Trust Assets
have been distributed, abandoned or otherwise disposed of, the members of the   
Trust Advisory Board shall resign their positions, whereupon they shall be      
discharged from further duties and responsibilities.                            

                 The Trust Advisory Board may, by majority vote, authorize the
Trustee to invest the corpus of the Trust in prudent investments other than     
those described in section 345 of the Bankruptcy Code.                          

          The Trust Advisory Board may remove the Trustee in its
discretion. In the event the requisite approval is not obtained, the Trustee may
be removed by the Bankruptcy Court for cause shown. In the event of the         
resignation or removal of the Trustee, the Trust Advisory Board shall, by       
majority vote, designate a person to serve as successor Trustee.                

                  Notwithstanding anything to the contrary in this Plan, neither
the Trust Advisory Board or any of its members, designees, counsel, financial   
advisors or any duly designated agent or representatives of any such party shall
be liable for the act, default or misconduct of any other member of the Trust   
Advisory Board, nor shall any member be liable for anything other than such     
member's own gross negligence or willful misconduct. The Trust Advisory Board   
may, in connection with the performance of its duties, and in its sole and      
absolute discretion, consult with its counsel, accountants or other             
professionals, and shall not be liable for anything done or omitted or suffered 
to be done in accordance with such advice or opinions. If the Trust Advisory    
Board determines not to consult with its counsel, accountants or other          
professionals, it shall not be deemed to impose any liability on the Trust      
Advisory Board, or its members and/or designees.                                

                 The Trust Advisory Board shall govern its proceedings through
the adoption of by-laws, which the Trust Advisory Board may adopt by majority   
vote. No provision of such by-laws shall supersede any express provision of the 
Plan.                                                                           

E.       FUNDING OF THE WGI CREDITOR TRUST                                      

                           The Initial Deposit shall be funded by the Debtors or
Reorganized Debtors by delivering to the Trustee $20 million on the Effective   
Date. The Trustee shall use the Initial Deposit consistent with the purpose of  
the WGI Creditor Trust and subject to the terms and conditions of this Plan and 
the WGI Creditor Trust Agreement.                                               

F.       REIMBURSEMENT OBLIGATION                                               

                 Immediately upon receipt of any and all Trust Recoveries by
the WGI Creditor Trust, the Trustee shall pay such Trust Recoveries to          
Reorganized WGI until such time as the Reimbursement Obligation is paid in full,
which includes interest at a rate of 20%                                        

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per annum, compounded quarterly. The Creditors' Committee believes that a 20%   
interest rate is unreasonable.                                                  

G.       DISTRIBUTIONS OF TRUST ASSETS                                          

                The Trustee shall make distributions of Net Trust Recoveries
as, in accordance with the WGI Creditor Trust Agreement, which shall provide for
distributions as follows: FIRST, to pay the Trust Expenses; SECOND, to repay the
Reimbursement Obligation, THIRD, to holders of Allowed Claims in Class 7 on a   
pro rata basis. Such distributions shall be made at the times and in the manner 
set forth in the WGI Creditor Trust Agreement.                                  

                 If there is any Net Trust Recovery remaining after payment in
full of each Allowed General Unsecured Claim plus simple interest at the rate of
20% per annum from the Petition Date to the date of payment of such Allowed     
General Unsecured Claim, such funds will be distributed by the Trustee to       
holders of Old Common Stock as of the Distribution Date on a pro rata basis.    

VIII.  CERTAIN FACTORS TO BE CONSIDERED   

          The holder of a Claim against a Debtor should read and
carefully consider the following factors, as well as the other information set  
forth in this Disclosure Statement (and the documents delivered together        
herewith and/or incorporated by reference herein), before deciding whether to   
vote to accept or to reject the Plan.                                           

A.       GENERAL CONSIDERATIONS                                                 

           The Plan sets forth the means for satisfying the Claims
against each of the Debtors. Certain Claims and Interests receive no            
distributions pursuant to the Plan. Reorganization of certain of the Debtors'   
businesses and operations under the proposed Plan also avoids the potentially   
adverse impact of a liquidation on those Debtors' employees and other           
stakeholders.                                                                   

B.       CERTAIN BANKRUPTCY CONSIDERATIONS                                      

1.       FAILURE TO CONFIRM OR CONSUMMATE THE PLAN            

                  Even if all Impaired voting classes vote in favor of the Plan,
and with respect to any Impaired Class deemed to have rejected the Plan the     
requirements for "cramdown" are met, the Bankruptcy Court, which, as a court of 
equity, may exercise substantial discretion, may choose not to confirm the Plan.
Section 1129 of the Bankruptcy Code requires, among other things, a showing that
confirmation of the Plan will not be followed by liquidation or the need for    
further financial reorganization of the Debtors, (SEE SECTION XI.A), and that   
the value of distributions to dissenting holders of Claims and Interest may not 
be less than the value such holders would receive if the Debtors were liquidated
under Chapter 7 of the Bankruptcy Code. SEE SECTION XI.C. Although the Debtors  
believe that the Plan will meet such tests, there can be no assurance that the  
Bankruptcy Court will reach the same conclusion. See APPENDIX B annexed hereto  
for a liquidation analysis of the Debtors.                                      

               In addition, the Creditors' Committee has asserted that the
Board of Directors of WGI has a duty to maximize value by marketing the Debtors'
estates openly during the Chapter 11 Cases. The Debtors and Prepetition Secured 
Lenders dispute the Creditors' Committee's contention. Moreover, as described   
elsewhere in the Disclosure Statement, the Company did, in fact, solicit        
interest from potential third parties for a the sale of the Company or portions 
thereof and agreed to cooperate with the Creditors' Committee in its efforts to 
contact prospective purchasers. The Debtors believe that no meaningful offers   
were ever received. SEE SECTION IV.B.                                           

         The Plan provides for certain conditions that must be
fulfilled prior to confirmation of the Plan and the Effective Date. As of the   
date of this Disclosure Statement, there can be no assurance that any or all of 
the conditions in the Plan will be met (or waived) or that the other conditions 
to consummation, if any, will be satisfied. Accordingly, even if the Plan is    
confirmed by the Bankruptcy Court, there can be no assurance that the Plan will 
be consummated and the restructuring completed. If a liquidation or protracted  
reorganization were to occur, there is a substantial risk that the value of the 
Debtors' enterprise would be substantially eroded to the detriment of all       
stakeholders.                                                                   

       2.       DISRUPTION OF OPERATIONS DUE TO THE FILING OF THE CHAPTER 11
CASES                                       

               As part of the first day relief requested in the Chapter 11
Cases, the Bankruptcy Court entered orders allowing the Debtors to pay          
prepetition employee obligations and certain prepetition key vendor trade claims
in the ordinary course of business. SEE SECTION I.G. The Debtors, therefore,    
believe that the solicitation with respect to the Plan will not have a material 
adverse affect the Debtors' relationships with customers, employees, and        
suppliers, provided that the Debtors demonstrate sufficient liquidity to        
continue to operate                                                             

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their businesses.                                                               

                The Debtors believe that relationships with their customers,
suppliers and employees will be maintained, and the going concern value of the  
business will be preserved, if the Chapter 11 process is completed on the       
expedited timetable established at the outset of these cases. SEE SECTION IV.C. 
However, if there is a protracted Chapter 11 process, the Debtors' operations   
could be materially adversely affected.                                         

             The filing of the Chapter 11 Cases by the Debtors and the
publicity attendant thereto might also adversely affect the businesses of the   
Non-Debtor Subsidiaries. Because the business of WGI is closely related to the  
businesses of all its subsidiaries, any downturn in the business of Non-Debtor  
Subsidiaries could also affect the Debtors' prospects. Although WGI does not    
believe that the commencement of the Chapter 11 cases will adversely affect the 
businesses of any Non-Debtor Subsidiaries, if there is a protracted Chapter 11  
Case, the possibility of adverse effects on such Non-Debtor Subsidiaries may    
increase. The Non-Debtor Subsidiaries do not have the benefit of the automatic  
stay.                                                                           

C.       INHERENT UNCERTAINTY OF FINANCIAL PROJECTIONS                          

            The Projections set forth in APPENDIX C hereto cover the
Debtors' operations through fiscal 2004. These Projections are based on numerous
assumptions that are an integral part of the Projections, including confirmation
and consummation of the Plan in accordance with its terms, realization of the   
operating strategy of the Reorganized Debtors, industry performance, no material
changes in applicable legislation or regulations, exchange rates, or generally  
accepted accounting principles, general business and economic conditions,       
competition, adequate financing, absence of material contingent or unliquidated 
litigation or indemnity claims, and other matters, many of which are beyond the 
control of the Reorganized Debtors and some or all of which may not materialize.

                 In addition, unanticipated events and circumstances occurring
subsequent to the date of this Disclosure Statement may affect the actual       
financial results of the Reorganized Debtors' operations. Accordingly, the      
Projections are not necessarily indicative of the future financial condition or 
results of operations of the Reorganized Debtors, which may vary significantly  
from those set forth in the Projections. Consequently, the projected financial  
information contained herein should not be regarded as a representation by the  
Debtors, the Debtors' advisors, or any other person that the Projections can or 
will be achieved. SEE SECTION XI.A.                                             

D.       INTEGRATION ISSUES                                                     

                  Prior to the Petition Date, the Debtors deployed an aggressive
strategy of growth through acquisitions. In connection with these acquisitions, 
there may be liabilities that WGI failed to discover, including liabilities     
arising from pollution of the environment or non-compliance with environmental  
laws by prior owners, and for which WGI, as a successor owner, may be           
responsible and that are not being discharged under the Plan. Indemnities and   
warranties for such liabilities from sellers, if obtained, may not fully cover  
the liabilities due to their limited scope, amounts, or duration, the financial 
limitations of the indemnitor or warrantor, or other reasons.                   

                 There are significant uncertainties and risks relating to the
integration of an acquired company's operations. Whether the anticipated        
benefits of an acquisition are ultimately achieved depends on a number of       
factors, including the ability of the combined companies to achieve             
administrative cost savings, insurance and bonding cost reductions, general     
economies of scale and, generally, to capitalize on the combined asset base and 
strategic position of the combined companies. The timing and manner of the      
implementation of decisions made with respect to the ongoing business of the    
combined companies following the acquisition will materially affect the         
operations of the combined companies.                                           

           Given the range of potential outcomes arising from such
decisions and the interrelationships among decisions to be made, it is difficult
to quantify with precision the impact of such decisions on the results of       
operations and financial condition of the combined companies. There can be no   
assurance that any expected synergies will be realized or that the results of   
the combined operations will be improved in a timely manner, if at all. In      
addition, the process of integrating the acquired company's operations into     
those of the Debtors could cause the interruption of, or the loss of momentum   
in, the activities of either or both companies, which could have an adverse     
effect on the combined operations. The continuing process of integrating the    
businesses of WGI, the RE&C Businesses and the Westinghouse Group may involve   
unforeseen difficulties and may require a disproportionate amount of time and   
attention of the Debtors' management and financial and other resources. SEE     
SECTION IV.A.                                                                   

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E.       LACK OF ESTABLISHED MARKET FOR THE NEW SECURITIES                      

                There is no existing market for the New Common Shares or and
there can be no assurance that an active market for such securities will develop
or, if any such market does develop, that it will continue to exist, or as to   
the degree of price volatility in any such market that does develop. No         
assurance can be given as to the liquidity of the market for New Common Shares  
or the price at which any sales may occur.                                      

             As of the Petition Date, WGI had 52,349,872 shares of Old
Common Shares issued and outstanding, and which, at one time, were traded on the
NYSE. The NYSE has certain listing criteria applicable to companies listed on   
such exchanges, including financial criteria and minimum requirements as to the 
number of holders of listed securities. Trading of Old Common Stock has been    
suspended by the NYSE and the Old Common Stock may be delisted. The Debtors will
use reasonable commercial efforts to have the New Common Shares listed on a     
national securities exchange. However, there can be no assurance that           
Reorganized WGI will be successful in listing its securities with any exchange. 
In the event that Reorganized WGI is unable to cause any of the New Common      
Shares to be listed on any exchange or quoted on any quotation system, the      
liquidity of the New Common Shares would be materially impaired.                

F.       RESTRICTED RESALE OF THE NEW SECURITIES                                

                  The New Common Shares will be distributed pursuant to the Plan
without registration under the Securities Act and without qualification or      
registration under the State Laws, pursuant to exemptions from such registration
and qualification contained in section 1145(a) of the Bankruptcy Code. With     
respect to persons who receive such securities pursuant to the Plan, these      
Bankruptcy Code exemptions apply only to the distribution of such securities    
under the Plan and not to any subsequent sale, exchange, transfer or other      
disposition of such securities or any interest therein by such persons.         
Therefore, subsequent sales, exchanges, transfers or other disposition of such  
securities or any interest therein by "underwriters" or "affiliates" would not  
be exempted by section 1145 of the Bankruptcy Code from registration under the  
Securities Act or the State Laws.                                               

               Additionally, New Common Shares may not be sold, exchanged,
transferred, or otherwise disposed of without registration or qualification     
under the State Laws unless specific exemptions from such registration or       
qualification requirements are available with respect to such sale, exchange,   
transfer, or disposition. SEE SECTION IX.B.2.                                   

G.       ENVIRONMENTAL MATTERS                                                  

           The Reorganized Debtors will be subject to a variety of
environmental laws and regulations governing, among other things, discharges to 
air and water, the handling, storage, and disposal of hazardous or solid waste  
materials and the remediation of contamination associated with releases of      
hazardous substances. Such laws and regulations and the risk of attendant       
litigation can cause significant delays to a project and add significantly to   
its cost. Violations of these environmental laws and regulations could subject  
the Reorganized Debtors and their management to civil and criminal penalties and
other liabilities. There can be no assurance that such laws and regulations will
not become more stringent, or more stringently implemented, in the future.      

           Various federal, state and local environmental laws and
regulations, as well as common law, may impose liability for property damage and
costs of investigation and cleanup of hazardous or toxic substances on property 
currently or previously owned by the Debtors or arising out of the Debtors'     
waste management activities. Such laws may impose responsibility and liability  
without regard to knowledge of or causation of the presence of the contaminants,
and the liability under such laws is joint and several. The Debtors have        
potential liabilities associated with their past waste disposal activities and  
with their current and prior ownership of certain property. In general, the     
Debtors believe that the likely amount of such liabilities will not be material,
because the Debtors may have a valid defense to liability with respect to a     
given site or the Debtors should only be responsible for a small percentage of  
the total cleanup costs with respect to a given site. However, because liability
under such laws is joint and several, no assurances can be given that the       
Reorganized Debtors will not eventually be responsible for all or a substantial 
portion of the liabilities associated with one or more of these sites, which    
liabilities could be material either individually or in the aggregate.          

H.       UNIMPAIRED AND UNKNOWN CLAIMS                                          

              The Plan provides that the only claims against the Debtors
that are Impaired are the claims set forth in Classes 6 and 7. All other claims 
against the Debtors are being left Unimpaired under the Plan. The Unimpaired    
Claims include, but are not limited to, Employee Claims. To the extent that such
claims are required to be reflected on financial statements, the Debtors believe
that their financial statements and projected financial statements properly     
reflect these claims in accordance with generally accepted accounting           
principles. However, the actual amount of such claims may materially differ from
those set forth in the financial statements and projections. Further, there are 
likely to be Claims that exist which the Debtors are not aware of at this time. 
Some of such Claims (such as potential liability to                             

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unknown future asbestos claimants) may not be discharged under the Plan. The    
Debtors are taking no action in the Chapter 11 Cases to disallow, liquidate or  
otherwise cap any Unimpaired Claims. The liability of the Debtors as to         
Unimpaired Claims, and certain types of unknown claims that, under applicable   
law, may not be discharged after their emergence from Chapter 11 will not have  
been reduced or otherwise affected by the Chapter 11 Cases or the Plan. There   
can be no assurance that the Debtors' financial position and results of         
operations after emergence from Chapter 11 pursuant to the Plan could not be    
materially and adversely affected by the Unimpaired Claims or unknown Claims.   

I.       INDUSTRY CYCLICALITY                                                   

            Demand for the services to be offered by the Reorganized
Debtors has been, and is expected to continue to be, subject to significant     
fluctuations due to a variety of factors beyond the control of the Reorganized  
Debtors, including economic conditions. During economic downturns, the ability  
of both private and governmental entities in targeted markets to make capital   
expenditures on infrastructure improvement may decline significantly. There can 
be no assurance that economic conditions generally will be favorable or that    
there will not be significant fluctuations adversely affecting the industry as a
whole or key markets targeted by the Reorganized Debtors and, as a result, the  
Reorganized Debtors and their financial results.                                

J.       BUSINESS AND COMPETITION                                               

              The Debtors' competitive position in the markets that they
serve has been adversely impacted by the difficulty in obtaining bonding        
capacity and their lack of financial flexibility that, among other things,      
inhibit their ability to secure project financing. The Debtors are engaged in   
highly competitive businesses, particularly those portions relating to          
engineering, construction and other service contracts that are awarded through  
competitive bidding processes. The Debtors compete with other general and       
specialty contractors, both foreign and domestic, including large international 
contractors and small local contractors. Many such competitors have a           
substantially stronger financial position than do the Debtors, which, in some   
instances, could give them a competitive advantage over the Debtors. While the  
Debtors' management believes that the Plan will greatly improve the Reorganized 
Debtors' ability to compete more effectively in the industries in which they    
conduct their business, there can be no assurance that the Reorganized Debtors  
will be able to compete successfully for new projects following the consummation
of the Plan.                                                                    

K.       GOVERNMENT CONTRACTS                                                   

                  U.S. Government contracts historically have been a significant
part of the Debtors' businesses. Contracts and subcontracts with various        
government entities accounted for nearly 30% of WGI's revenues for the nine     
months ended September 1, 2000. The Debtors' poor financial position may have a 
disproportionately adverse impact on the Debtors' ability to obtain new U.S.    
Government contracts during the period in which the Debtors are soliciting      
approvals of the Plan or are in court proceedings pursuant to the Plan. The     
Debtors' management believes that it is unlikely that any U.S. Government       
contract will be awarded to the Debtors during the period the Debtors are in    
Chapter 11.                                                                     

                Although the Debtors' management believes that following the
consummation of the Plan, the Reorganized Debtors should be in good position to 
obtain U.S. Government contracts, there can be no assurance that such will be   
the result. In the event that the Reorganized Debtors are unable to obtain new  
U.S. Government contracts, there would be a material adverse effect on the      
Reorganized Debtors.                                                            

                  The Debtors have a number of cost reimbursement contracts with
various agencies of the U.S. Government, the allowable costs of which are       
subject to audit by the U.S. Government. As a result of such audits, U.S.       
Government auditors assert from time to time that certain costs claimed as      
reimbursable under government contracts either were not allowable costs or were 
not allocable in accordance with federal government regulations. The resolution 
of these audits may result in various sanctions including repayments of amounts 
previously paid by the U.S. Government to the Debtors. Some audits have resulted
in cost disallowances and claims for reimbursement by the government.           

                The Debtors have a number of contracts and subcontracts with
various agencies of the U.S. Government, principally for environmental          
remediation and restoration work, which extend beyond one year and for which    
government funding has not yet been approved. There can be no assurance that    
such funding will be approved. All contracts with agencies of the U.S.          
Government and some commercial and foreign contracts are subject to termination 
for convenience. In the event of a termination, the Debtors would not receive   
projected revenues or profits associated with the terminated portion of such    
contracts.                                                                      

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L.       FIXED PRICE CONTRACTS AND OTHER PROJECT RISKS                          

         In connection with their engineering and construction
business, the Debtors enter into three basic types of contracts: (i) fixed-price
or lump-sum contracts providing for a single price for the total amount of work 
to be performed, under which risk is typically highest; (ii) unit-price         
contracts providing for a specified price for each unit of work performed, under
which anticipated income is the highest; (iii) and cost-type contracts          
(including cost-plus) providing for reimbursement of allowable or otherwise     
defined costs incurred plus a fee, under which risk is minimal and anticipated  
income is earned solely from the fee received for services provided. In         
connection with its engineering contracts, including design and program         
management, compensation is typically on a cost-plus-fee basis.                 

                 Regardless of the type of contract, the construction business
has always been subject to unusual risks, including unforeseen conditions       
encountered during construction, the impact of inflation upon costs and         
financing requirements of clients and changes in political and legal            
circumstances, particularly since contracts for major projects are performed    
over extended periods of time. Other risks include the failure of third party   
project participants, including joint venture partners and subcontractors, to   
obtain required permits or to perform essential functions on a timely basis, the
failure of local governing authorities to take certain necessary actions,       
opposition by community groups in the locality of a project or by other         
interested third parties to the project's development, and the failure to obtain
adequate financing for the project. The Debtors may be exposed to significant   
risks and uncertainties in the performance of contracts, particularly           
fixed-price contracts.                                                          

              Because of the size and complexity of major infrastructure
projects, a relatively small number of projects may provide a significant       
percentage of the Debtors' revenue in a given year. The loss of one or more     
major contracts or the inability of the Debtors to perform profitably under one 
or more major contracts, could have a material adverse effect on the Debtors'   
financial condition, results of operations and cash flows.                      

M.       INTERNATIONAL OPERATIONS                                               

                  WGI pursues project opportunities throughout the world through
foreign and domestic subsidiaries as well as agreements with foreign            
joint-venture partners. These foreign operations are subject to special risks,  
including: uncertain political and economic environments, potential             
incompatibility with foreign joint-venture partners, foreign currency controls  
and fluctuations, civil disturbances, and labor strikes. Although these projects
are heavily concentrated in WGI's Non-Debtor Subsidiaries, these risks still    
weigh on the Company's overall financial health.                                

               Events outside of the Debtors' control may limit or disrupt
operations, restrict the movement of funds, result in deprivation of contract   
rights, increase foreign taxation or limit repatriation of earnings. In         
addition, in certain cases, applicable law and joint-venture or other agreements
may provide that each joint-venture partner is jointly and severally liable for 
all liabilities of the venture.                                                 

N.       BONDING                                                                

                  The Debtors' business operations are highly dependent on their
ability to obtain construction bond coverages sufficient to meet bid            
requirements imposed by potential customers. The Debtors' ability to obtain     
adequate bonding coverages has been severely impacted by the Debtors' poor      
financial position and lack of liquidity. Due to the Debtors' limited access to 
bonding capacity, the Debtors may be required to collaborate or partner with    
competitors to obtain adequate bonding capacity with which to bid on new        
projects. Such collaborations mean that Debtors would be forced to surrender    
some benefits from new bidding opportunities to their competitors at a cost to  
the Debtors' operating performance.                                             

                  The Debtors' management believes that the Plan will facilitate
Reorganized WGI's access to adequate bonding capacity to meet the requirements  
of new project bids, without collaboration with its competitors. However, there 
can be no assurance that Reorganized WGI will obtain access to adequate bonding 
capacity following consummation of the Plan, or that such bonding will be       
available on terms acceptable to Reorganized WGI. If adequate bonding capacity  
is not available or if the terms of such bonding are too onerous, there would be
a material adverse effect on Reorganized WGI. Negotiations with surety companies
for go-forward bonding capacity are ongoing. Regardless of the outcome of such  
discussions, Reorganized WGI will continue to pursue environmental, construction
and other projects in partnership arrangements with other contractors to support
Reorganized WGI's performance of contracts. SEE SECTION V.E.4                   

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O.       RELIANCE ON KEY PERSONNEL                                              

              One of the Debtors' primary assets is their highly skilled
professionals, who have the ability to leave the Debtors and so deprive them of 
the skill and knowledge essential for performance of new and existing contracts.
The Debtors operate a service business which is highly dependent on their       
customers' belief that the Debtors will perform tasks of the highest standards  
over an extended period of time. Continued deterioration of the Debtors'        
business, or loss of a significant number of key professionals, will have a     
material adverse effect on the Debtors and may threaten their ability to survive
as going concerns.                                                              

                The Debtors' successful transition through the restructuring
process is dependent in part on their ability to retain and motivate their      
officers and key employees. There can be no assurance that the Debtors will be  
able to retain and employ qualified management and technical personnel. The     
Debtors are seeking Bankruptcy Court approval of a bonus program designed to    
retain certain of their key employees, but there is no guarantee that such      
program will be approved, or if approved that it will have the intended effect. 
SEE SECTION V.E.                                                                

P.       CERTAIN LITIGATION                                                     

             Although the Debtors believe that the Raytheon Claims are
valid, if the Debtors are unsuccessful in prosecuting such claims, the corpus of
the WGI Creditor Trust may not contain any realizable assets. The Debtors have  
filed suit against Raytheon alleging fraud and seeking rescission and,          
alternatively, unspecified damages and specific performance for breach of       
contract, and will file suit seeking the avoidance and recovery of transfers and
obligations under applicable provisions of the Bankruptcy Code. SEE SECTION     
V.I.1. The Debtors believe that Raytheon intends to assert claims against the   
Debtors. SEE APPENDIX D. Litigation of this variety is inherently uncertain and 
there can be no guarantee of any outcome. The Trustee may decide that the best  
hope for recovery for the WGI Creditor Trust lies in settling the Raytheon      
Claims. Such settlement may be significantly less than the damages which were   
caused and/or the transfers to be recovered, or the total amount of Class 7     
Claims.                                                                         

                 Representative plaintiffs John B. Blyler and Malcolm J. Corse
are the representative plaintiffs in a class action pending in the United States
District Court for the District of Idaho in which they were certified by the    
Idaho District Court on July 12, 2000, to represent a class consisting of all   
participants in the Morrison Knudsen Employee Stock Ownership Plan on and after 
September 22, 1993, and their beneficiaries, and all participants in the        
Morrison Knudsen Savings Plan (the "MK Savings Plan") for whose benefit the MK  
Savings Plan held MK common stock after September 22, 1993, and their           
beneficiaries, but excluding all of the Defendants and their beneficiaries (the 
"Idaho Class Plaintiffs"). The Idaho Class Plaintiffs have made the assertion   
that their claims represent potentially material obligations of the Reorganized 
Debtors. The Debtors dispute that assertion. Claims of the Idaho Class          
Plaintiffs against the Debtors (if any), would be Class 7 Claims. Claims against
individual defendants (if any) would not be released or discharged under the    
Plan. Those individual defendants may have rights to be indemnified by the      
Debtors, which indemnification rights are being assumed under the Plan. SEE     
SECTION VI.H. Also, the Debtors maintain ERISA fiduciary insurance.             

          In addition, there are certain other claims, lawsuits,
disputes with third parties, investigations and administrative proceedings      
against the Debtors relating to matters in the ordinary course of its business  
activities which could materially and adversely affect the Debtors'             
reorganization.                                                                 

IX.  APPLICABILITY OF FEDERAL AND OTHER SECURITIES LAWS 

                No registration statement will be filed under the Securities
Act or any state securities laws with respect to the issuance or subsequent     
transfer of the New Common Shares under the Plan. The Debtors believe that,     
subject to certain exceptions described below, various provisions of the        
Securities Act, the Bankruptcy Code and state securities laws exempt from       
federal and state securities registration requirements (i) the offer and the    
sale of such securities pursuant to the Plan; and (ii) subsequent transfers of  
such securities.                                                                

A.       OFFER AND SALE OF NEW SECURITIES, PURSUANT TO THE PLAN: BANKRUPTCY CODE
EXEMPTION FROM REGISTRATION REQUIREMENTS                      

               Section 1145(a)(1) of the Bankruptcy Code exempts the offer
and sale of securities under a plan of reorganization from registration under   
both the Securities Act and state securities laws, if three principal           
requirements are satisfied: (i) the securities must be issued "under a plan" of 
reorganization by the debtor or its successor under a plan or by an affiliate   
participating in a joint plan of reorganization with the debtor; (ii) the       
recipients of the securities must hold a pre-petition or administrative expense 
claim against the debtor or an interest in the debtor; and (iii) the securities 
must be issued entirely in exchange for the recipient's claim against or        
interest in the debtor, or "principally" in such exchange and "partly" for cash 
or property. The Debtors believe that the offer and sale of the New Common      
Shares under the Plan satisfies the requirements of section 1145(a)(1) of the   
Bankruptcy Code and is, therefore, exempt from registration under the Securities
Act and state securities laws.                                                  

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B.       SUBSEQUENT TRANSFERS OF NEW SECURITIES                                 

     1.       FEDERAL SECURITIES LAWS: SECTION 1145(c) OF THE BANKRUPTCY
CODE                                        

                  Section 1145(c) of the Bankruptcy Code deems any offer or sale
of securities of the kind and in the manner specified in section 1145(a)(1) of  
the Bankruptcy Code to have been a public offering. Accordingly, the New Common 
Shares generally will be freely transferable by holders of Impaired Claims under
the Securities Act unless the Holder is deemed, by section 1145(b) of the       
Bankruptcy Code, to be an "underwriter" for purposes of section 2(11) of the    
Securities Act with respect to such securities. Section 1145(b) of the          
Bankruptcy Code deems any entity to be an "underwriter" under section 2(11) of  
the Securities Act, if such entity:                                             

                 a.       purchases a claim against, interest in, or claim for
                           an administrative expense in the case concerning, the
                debtor, if such purchase is with a view to
                        distributing any security received in exchange for
such a claim or interest; 

              b.       offers to sell securities offered or sold under a
              plan for the holders of such securities;

               c.       offers to buy securities offered or sold under the
                      plan from the holders of such securities, if the
                       offer to buy is: (A) with view to distribution of
                         such securities; and (B) under an agreement made in
                        connection with the plan, with the consummation of
                       the plan, or with the offer or sale of securities
under the plan; or        

                  d.       is an "issuer" with respect to the securities, as the
                      term "issuer" is defined in section 2(11) of the
Securities Act.           

          Under section 2(11) of the Securities Act, an "issuer"
includes any person directly or indirectly controlling or controlled by the     
issuer, or any person under direct or indirect common control with the issuer.  

                 To the extent that holders of Impaired Claims who receive New
Common Shares pursuant to the Plan are deemed to be "underwriters," such        
securities may not be resold by such persons unless such securities are         
registered under the Securities Act or an exemption from such registration      
requirements is available. However, it is anticipated that holders of a portion 
of the New Common Shares will be entitled to demand that the Reorganized Debtor 
register the resale of such shares under the Securities Act and that such       
holders of New Common Shares will be permitted to obtain registration of the    
sale of their New Common Shares in certain circumstances in connection with     
certain registered offerings of New Common Shares by Reorganized WGI. SEE       
SECTION VI.F.1.                                                                 

                 Whether or not any particular person would be deemed to be an
"underwriter" with respect to the New Common Shares would depend upon various   
facts and circumstances applicable to that person. Accordingly, the Debtors     
express no view as to whether any particular person receiving New Common Shares 
under the Plan would be an "underwriter" with respect to the New Common Shares. 

              GIVEN THE COMPLEX AND SUBJECTIVE NATURE OF THE QUESTION OF
WHETHER A PARTICULAR HOLDER MAY BE AN UNDERWRITER, THE DEBTORS MAKE NO          
REPRESENTATION CONCERNING THE RIGHT OF ANY PERSON TO TRADE IN THE NEW COMMON    
SHARES. THE DEBTORS RECOMMEND THAT POTENTIAL RECIPIENTS OF THE NEW COMMON SHARES
CONSULT THEIR OWN COUNSEL CONCERNING WHETHER THEY MAY FREELY TRADE NEW COMMON   
SHARES WITHOUT COMPLIANCE WITH THE SECURITIES ACT OR THE EXCHANGE ACT.          

2.       SUBSEQUENT TRANSFERS OF NEW COMMON SHARES UNDER STATE
SECURITIES LAWS                             

             If the New Common Shares are listed on the New York Stock
Exchange, the American Stock Exchange or the Nasdaq National Market, the New    
Common Shares will be generally freely tradeable under state securities laws. If
the New Common Shares are not listed on any of the above exchanges or the Nasdaq
National Market, the New Common Shares will not be freely tradeable under state 
securities laws unless there is an available exemption from registration under  
such laws. A majority of states provide an exemption from registration for      
secondary market transactions under the so-called "manual exemption" if         
financial and other information about an issuer is published in certain manuals 
published by Moody's Investor Service, Inc. or Standard & Poor's. If the New    
Common Shares are not listed on one of the above exchanges or the Nasdaq        
National Market, the Reorganized Debtors intend to provide the necessary        
information in order to be able to take advantage of such manual exemptions.    

X.   INCOME TAX CONSEQUENCES OF THE PLAN    

               A summary description of certain income tax consequences of
the Plan is provided below. The description of tax consequences below is for    
informational purposes only and, due to a lack of definitive judicial or        
administrative authority or interpretation, substantial uncertainties exist with
respect to various tax consequences of the Plan as discussed herein. Only the   
principal consequences                                                          

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of the Plan for certain Debtors and for holders of Claims who are entitled to   
vote to accept or reject the Plan are described below. No opinion of counsel has
been sought or obtained with respect to any tax consequences of the Plan. No    
rulings or determinations of the Internal Revenue Service (the "IRS") or any    
other tax authorities have been sought or obtained with respect to the tax      
consequences of the Plan, and the discussion below is not binding upon the IRS  
or such other authorities. The Debtors are not making any representations       
regarding the particular tax consequences of the confirmation and consummation  
of the Plan as to any Claim holder, and are not rendering any form of legal     
opinion as to such tax consequences.                                            

      The discussion of United States federal income tax
consequences below is based on the Internal Revenue Code of 1986, as amended    
(the "IRC"), the Treasury regulations promulgated thereunder, judicial          
decisions, and published administrative rulings and pronouncements of the IRS as
in effect on the date hereof. Legislative, judicial or administrative changes or
interpretations enacted or promulgated after the date hereof could alter or     
modify the analyses set forth below with respect to the United States federal   
income tax consequences of the Plan. Any such changes or interpretations may be 
retroactive and could significantly affect the United States federal income tax 
consequences discussed below.                                                   

                 EXCEPT TO A LIMITED EXTENT, THE FOLLOWING DISCUSSION DOES NOT
ADDRESS FOREIGN, STATE OR LOCAL TAX CONSEQUENCES OF THE PLAN, NOR DOES IT       
PURPORT TO ADDRESS THE UNITED STATES FEDERAL TAX CONSEQUENCES OF THE PLAN TO    
SPECIAL CLASSES OF TAXPAYERS (SUCH AS FOREIGN ENTITIES, S CORPORATIONS,         
REGULATED INVESTMENT COMPANIES, INSURANCE COMPANIES, FINANCIAL INSTITUTIONS,    
SMALL BUSINESS INVESTMENT COMPANIES, BROKER-DEALERS AND TAX-EXEMPT              
ORGANIZATIONS). FURTHERMORE, UNITED STATES FEDERAL ESTATE AND GIFT TAX ISSUES   
ARE NOT ADDRESSED HEREIN. THE FOLLOWING DISCUSSION ASSUMES THAT CLAIM HOLDERS   
HOLD THEIR CLAIMS AS CAPITAL ASSETS FOR UNITED STATES FEDERAL INCOME TAX        
PURPOSES.                                                                       

               EACH HOLDER OF A CLAIM IS STRONGLY URGED TO CONSULT ITS TAX
ADVISOR REGARDING THE UNITED STATES FEDERAL, STATE, AND LOCAL AND ANY FOREIGN   
TAX CONSEQUENCES OF THE TRANSACTIONS DESCRIBED HEREIN AND IN THE PLAN.          

A.       FEDERAL INCOME TAX CONSEQUENCES TO THE DEBTORS                         

1.       CANCELLATION OF INDEBTEDNESS INCOME                  

              Under general United States federal income tax principles,
each Debtor will realize cancellation of debt ("COD") income to the extent that 
its obligation to a Claim holder is discharged pursuant to the Plan for an      
amount less than the adjusted issue price (in most cases, the amount the Debtors
received upon incurring the obligation, with certain adjustments) of such       
holder's Claim. For this purpose, the amount paid to a Claim holder in discharge
of its Claim generally will equal the amount of Cash and the fair market value  
on the Effective Date of any other property paid to such Claim holder.          

                 Because the Debtors each will be debtors in a bankruptcy case
at the time they realize COD income, they will not be required to include such  
COD income in their gross income, but rather will be required to reduce certain 
of their respective tax attributes by the amounts of COD income so excluded.    
Under the general rules of IRC section 108, the required attribute reduction    
will be applied to reduce the net operating losses ("NOLs") and NOL             
carryforwards, to the extent of such NOLs and carryforwards, and certain other  
tax attributes of the Debtors. IRC section 108(b)(5) permits a corporation in   
bankruptcy proceedings to elect to apply the required attribute reduction to    
reduce first the basis of its depreciable property to the extent of such basis, 
with any excess applied next to reduce its NOLs and NOL carryforwards, and then 
certain other tax attributes. The Debtors have not yet determined whether they  
will make the election under IRC section 108(b)(5).                             

                Although not free from doubt, based on existing authorities,
the Debtors believe that any reduction in Tax Attributes will generally occur on
a separate company basis even though the Debtors file a consolidated federal    
income tax return. The IRS has recently taken the position, however, that       
consolidated NOLs must be reduced irrespective of the source of those losses.   
The current IRS position as to the impact of the attribute reduction rules on   
other tax attributes of consolidated group members is unclear.                  

2.       NET OPERATING LOSSES AND OTHER ATTRIBUTES            

                 The Debtors have NOL carryforwards. Current year NOLs, use of
general business, alternative minimum tax, and foreign tax credit carryforwards 
and NOL carryforwards may be reduced or eliminated by COD to be realized on     
implementation of the Plan. If the current year NOLs and existing NOL           
carryforwards are not so eliminated, however, Section 382 of the Code ("Section 
382") may substantially limit the Debtors' ability to use such loss carryforward
in future years.                                                                

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                 When a corporation undergoes an "ownership change," which WGI
will undergo pursuant to implementation of the Plan, Section 382 generally      
limits the ability of the corporation to utilize historic NOLs and subsequently 
recognized "built-in" losses, i.e., losses economically accrued but unrecognized
as of the date of the ownership change ("Annual Section 382 Limitation"). An    
"ownership change" is generally defined as a more than 50 percentage point      
change in ownership during a three year period ending on the date on which such 
change in ownership is tested.                                                  

               As a general rule, the Annual Section 382 Limitation equals
the product of the value of the stock of the corporation (with certain          
adjustments) immediately before the ownership change and the applicable         
"long-term tax-exempt rate" (currently 5.01%). Any unused portion of the Annual 
Section 382 Limitation is generally available in subsequent years. A corporation
must meet certain continuity of business enterprise requirements for at least   
two years following an ownership change in order to preserve the Annual Section 
382 Limitation.                                                                 

               Section 382 provides an exception to the application of the
Annual Section 382 Limitation for corporations under the jurisdiction of a court
in a title 11 case (the "Bankruptcy Exception"). The Bankruptcy Exception could 
apply to the Debtors if the Debtors' historic shareholders and creditors that   
held certain "qualified indebtedness" (as defined by regulation) prior to       
implementation of the Plan were to own more than 50% of the total voting power  
and total value of the stock of the Debtors after such implementation. The      
continuity of business enterprise requirement described above would not apply to
the Debtors under the Bankruptcy Exception.                                     

                 The Bankruptcy Exception could reduce the Debtors' pre-change
losses and excess credits that may be carried over to a post-change year for any
interest paid or accrued on any Allowed Class 6 Claims exchanged for New Common 
Shares. The Bankruptcy Exception also provides that a second ownership change   
occurring during the two-year period immediately following the first ownership  
change would eliminate any NOL carryforwards that arose before the first        
ownership change.                                                               

                  Section 382 provides that a corporation under the jurisdiction
of a court in a title 11 case may elect out of the Bankruptcy Exception even if 
the corporation meets all of the requirements thereof. The Debtors do not know  
whether they will qualify for the Bankruptcy Exception or, if they do so        
qualify, whether it would be advantageous to elect out. If the Bankruptcy       
Exception provides a specific benefit to the Debtors with respect to their      
existing NOL carryforward and current year NOLs, they may choose not to elect   
out. The Debtors are studying this issue and will make a timely decision on the 
best course of action.                                                          

               Assuming that the Debtors do not qualify for the Bankruptcy
Exception or elect out as discussed above, a special rule under Section 382     
applicable to corporations under the jurisdiction of a court in a title 11 case 
that are not subject to the Bankruptcy Exception will apply in calculating the  
Debtors' Annual Section 382 Limitation. Under this special rule, the limitation 
will be calculated by reference to the lesser of the value of the Debtor's stock
(with certain adjustments) immediately after the ownership change (as opposed to
immediately before the ownership change, as discussed above) or the value of the
Debtor's assets (determined without regard to liabilities) immediately before   
the ownership change. Although such calculation may substantially increase the  
Annual Section 382 Limitation, the Debtors' use of any NOL carryforward still   
may be substantially limited after the ownership change. If there is a second   
ownership change within two years of implementation of the Plan, the Annual     
Section 382 Limitation would not be affected.                                   

3.       FEDERAL ALTERNATIVE MINIMUM TAX                      

                  A corporation may incur alternative minimum tax liability even
where NOL carryovers and other tax attributes are sufficient to eliminate its   
taxable income as computed under the regular corporate income tax. It is        
possible that the Debtors will be liable for the alternative minimum tax.       

B.       FEDERAL INCOME TAX CONSEQUENCES TO CLAIM HOLDERS                       

                The income tax consequences of the transactions contemplated
by the Plan to a Claim holder will depend upon a number of factors under United 
States federal income tax law. For purposes of the following discussion, a      
"United States Person" is any person or entity (1) who is a citizen or resident 
of the United States, (2) that is a corporation or partnership created or       
organized in or under the law of the United States or any state thereof, (3)    
that is an estate, the income of which is subject to United States federal      
income taxation regardless of its source or (4) that is a trust whose           
administration is subject to the primary supervision of a United States court   
and with respect to which one or more United States persons have the authority  
to control all substantial decisions. A "Non-United States Person" is any person
or entity that is not a United States Person. Income tax consequences to Claim  
holders that are Non-United States Persons are generally discussed below under  
SECTION X.B.2.                                                                  

                The tax treatment of holders of Claims and the character and
amount of income, gain or loss recognized as a consequence of the Plan and the  
distributions provided for by the Plan will depend upon, among other things, (1)
the manner in which a holder acquired                                           

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a Claim; (2) the length of time the Claim has been held; (3) whether the Claim  
was acquired at a discount; (4) whether the holder has taken a bad debt         
deduction with respect to the Claim (or any portion thereof) in the current or  
prior years; (5) whether the holder has previously included accrued but unpaid  
interest with respect to the Claim; (6) the method of tax accounting of the     
holder; (7) whether the Claim is an installment obligation for United States    
federal income tax purposes; and (8) whether the Claim constitutes a "security" 
for federal income tax purposes. Therefore, holders of Claims should consult    
their tax advisors for information that may be relevant to their particular     
situation and circumstances and the particular tax consequences to them of the  
transactions contemplated by the Plan.                                          

1.       UNITED STATES FEDERAL INCOME TAX CONSEQUENCES        

a.       GENERAL                            

            A holder of a Claim against the Debtors that is a United
States Person and whose Claim is paid in full or otherwise discharged on the    
Effective Date will recognize gain or loss for United States federal income tax 
purposes in an amount equal to the difference between (A) the fair market value 
on the Effective Date of such holder's Pro Rata share of any property received  
in respect of its Claim and (B) the holder's adjusted tax basis in the Claim. A 
holder's tax basis in property received in exchange for its Claim will generally
be equal to the fair market value of such property on the Effective Date. The   
holding period for any such property will begin on the day after the Effective  
Date.                                                                           

b.       MARKET DISCOUNT                    

                  The market discount provisions of the IRC may apply to holders
of certain Claims. In general, a debt obligation other than a debt obligation   
with a fixed maturity of one year or less that is acquired by a holder in the   
secondary market (or, in certain circumstances, upon original issuance) is a    
"market discount bond" as to that holder if its stated redemption price at      
maturity (or, in the case of a debt obligation having original issue discount,  
its revised issue price) exceeds the tax basis of the debt obligation in the    
holder's hands immediately after its acquisition. However, a debt obligation    
will not be a "market discount bond" if such excess is less than a statutory DE 
MINIMIS amount. Gain recognized by a Claim holder with respect to a "market     
discount bond" will generally be treated as ordinary interest income to the     
extent of the market discount accrued on such bond during the Claim holder's    
period of ownership, unless the Claim holder elected to include accrued market  
discount in taxable income currently. A holder of a market discount bond that is
required under the market discount rules of the IRC to defer deduction of all or
a portion of the interest on indebtedness incurred or maintained to acquire or  
carry the bond may be allowed to deduct such interest, in whole or in part, on  
disposition of such bond.                                                       

c.       REORGANIZATION TREATMENT           

                 The transactions contemplated by the Plan with respect to WGI
and Reorganized WGI, pursuant to which holders of Allowed Class 6 Claims will   
each receive a Pro Rata share of 100% of the New Common Shares to be issued by  
Reorganized WGI may be treated as a "reorganization" for United States federal  
income tax purposes. If reorganization treatment is applicable, then the United 
States federal income tax consequences arising from the Plan to holders of      
Allowed Class 6 Claims may vary from those described above under SECTION X.B.1, 
depending upon, among other things, whether such Claims constitute "securities" 
for United States federal income tax purposes. The determination of whether a   
debt instrument constitutes a "security" depends upon an evaluation of the term 
and nature of the debt instrument. Generally, corporate debt instruments with   
maturities when issued of less than five years are not considered securities,   
and corporate debt instruments with maturities when issued of ten years or more 
are considered securities. The Debtors believe and intend to take the position  
that the Class 6 Claims should not be treated as securities for United States   
federal income tax purposes. If, as the Debtors believe to be the case, the     
Class 6 Claims do not constitute securities for United States federal income tax
purposes, then a holder of a such a Claim would be subject to the tax treatment 
described above under SECTION X.B.1.                                            

        It is possible that certain claims arising under the
Prepetition Senior Secured Credit Facility may constitute securities for United 
States federal income tax purposes and that the exchange such Claims for New    
Common Shares may constitute a reorganization for United States federal income  
tax purposes. In that case, a holder of a Claim with respect to the Prepetition 
Senior Secured Credit Facility should recognize gain, but not loss, with respect
to each Claim surrendered in an amount equal to the lesser of (x) the amount of 
gain realized (I.E., the excess of the fair market value of any property        
received by such holder in respect of its Claim over the adjusted tax basis of  
such Claim) and (y) the "boot" (as described below) received by such holder, if 
any, in respect of its Claim. A holder will be treated as receiving "boot" to   
the extent of the fair market value of property other than the New Common Shares
received by the holder. Any such gain recognized will be treated as capital gain
unless the boot received has the effect of the distribution of a dividend, in   
which case the gain will be treated as a dividend to the extent of the holder's 
ratable share of WGI's undistributed earnings and profits. In addition, a       
holder's aggregate tax basis in the New Common Shares should be equal to the    
aggregate tax basis in the Claims exchanged therefor, decreased by the amount of
boot received and increased by any gain recognized, and such holder's holding   
period for such property will include the holding period of the Claims exchanged
therefor. A holder's tax basis in any boot received will equal the fair market  
value of                                                                        

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such property on the Effective Date, and the holder's holding period in such    
property will begin on the day after the Effective Date.                        

2.       NON-UNITED STATES PERSONS                            

             A holder of a Claim against a Debtor that is a Non-United
States Person generally will not be subject to United States federal income tax 
with respect to property received in exchange for such Claim pursuant to the    
Plan, unless (a) such Claim holder is engaged in a trade or business in the     
United States to which income, gain or loss from the exchange is "effectively   
connected" for United States federal income tax purposes, or (b) if such Claim  
holder is an individual, such Claim holder is present in the United States for  
183 days or more during the taxable year of the exchange, and certain other     
requirements are met.                                                           

3.       INFORMATION REPORTING AND BACKUP WITHHOLDING         

            Certain payments, including the payments with respect to
Claims pursuant to the Plan, are generally subject to information reporting by  
the payor (the relevant Debtor) to the IRS. Moreover, such reportable payments  
are subject to backup withholding under certain circumstances. Under the IRC's  
backup withholding rules, a holder of a Claim may be subject to backup          
withholding with respect to distributions or payments made pursuant to the Plan,
unless the holder: (a) comes within certain exempt categories (which generally  
include corporations) and, when required, demonstrates this fact or (b) provides
a correct United States taxpayer identification number and certifies under      
penalty of perjury that the taxpayer identification number is correct and that  
the taxpayer is not subject to backup withholding because of a failure to report
all dividend and interest income.                                               

                 Holders of Claims that are Non-United States Persons and that
receive payments or distributions under the Plan through a United States office 
of the relevant Debtor will not be subject to backup withholding, provided that 
the holders furnish certification of their status as Non-United States Persons  
(and furnish any other required certifications), or are otherwise exempt from   
backup withholding. Generally, such certification is provided on IRS Form       
W-8BEN. Holders who receive payments or distributions under the Plan through a  
foreign office of the relevant Debtor may, if the Debtor has certain types of   
relationships to the United States, be subject to information reporting to the  
IRS regarding the exchange (but not backup withholding) unless the Debtor       
possesses in its files documentary evidence that the holder is a Non-United     
States Person and certain other conditions are met, or the holder otherwise     
establishes an exemption.                                                       

                 Backup withholding is not an additional tax. Amounts withheld
under the backup withholding rules may be credited against a holder's United    
States federal income tax liability, and a holder may obtain a refund of any    
excess amounts withheld under the backup withholding rules by filing an         
appropriate claim for refund with the IRS (generally, a United States federal   
income tax return).                                                             

C.       UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE WGI CREDITOR TRUST

                  Under the IRC, amounts earned by an escrow account, settlement
fund or similar fund must be subject to current tax. Although certain Treasury  
regulations have been issued, no Treasury regulations have been promulgated to  
address the tax treatment of such funds in a bankruptcy context. Accordingly,   
the proper tax treatment of such funds is uncertain. Depending on the facts and 
the relevant law, such funds possibly could be treated as grantor trusts,       
separately taxable trusts, or otherwise.                                        

                For federal income tax purposes, it is intended that the WGI
Creditor Trust be classified as a liquidating trust under section 301.7701-4 of 
the Procedure and Administration Regulations and that such trust is owned by its
beneficiaries. Accordingly, for federal income tax purposes, it is intended that
the beneficiaries be treated as if they had received a distribution of an       
undivided interest in the Trust Assets and then contributed such interests to   
the WGI Creditor Trust. There can be no assurance that the IRS will respect the 
foregoing treatment. For example, the IRS may characterize the WGI Creditor     
Trust as a grantor trust for the benefit of the Debtors, or as otherwise owned  
by and taxable to the Debtors. Alternatively, the IRS could characterize the WGI
Creditor Trust as a so-called "complex trust" subject to a separate entity level
tax on its earnings, except to the extent that such earnings are distributed    
during the taxable year. Moreover, due to the possibility that the amounts of   
the consideration received by a holder of an Allowed Class 7 Claim against WGI  
may increase or decrease, depending on whether the WGI Creditor Trust is treated
as a grantor trust, the holder could be prevented from recognizing a loss until 
the time at which there are no assets at all remaining in the WGI Creditor      
Trust.                                                                          

              Holders of Allowed Class 7 Claims against WGI are urged to
consult their tax advisors regarding the potential United States federal income 
tax treatment of the WGI Creditor Trust and the consequences to them of such    
treatment (including the effect on the computation of a holder's gain or loss in
respect of its Claim, the subsequent taxation of any distributions from the WGI 
Creditor Trust, and the possibility of taxable income without a corresponding   
receipt of cash or property with which to satisfy the tax liability).           

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D.       IMPORTANCE OF OBTAINING PROFESSIONAL TAX ASSISTANCE                    

             THE FOREGOING DISCUSSION IS INTENDED ONLY AS A SUMMARY OF
CERTAIN INCOME TAX CONSEQUENCES OF THE PLAN AND IS NOT A SUBSTITUTE FOR CAREFUL 
TAX PLANNING WITH A TAX PROFESSIONAL. THE ABOVE DISCUSSION IS FOR INFORMATIONAL 
PURPOSES ONLY AND IS NOT TAX ADVICE. THE TAX CONSEQUENCES ARE IN MANY CASES     
UNCERTAIN AND MAY VARY DEPENDING ON A CLAIM HOLDER'S PARTICULAR CIRCUMSTANCES.  
ACCORDINGLY, CLAIM HOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS ABOUT THE    
UNITED STATES FEDERAL, STATE, AND LOCAL, AND APPLICABLE FOREIGN INCOME AND OTHER
TAX CONSEQUENCES OF THE PLAN.                                                   

XI.    FEASIBILITY OF THE PLAN AND BEST INTERESTS OF CREDITORS

A.       FEASIBILITY OF THE PLAN                                                

               In connection with confirmation of the Plan, the Bankruptcy
Court will have to determine that the Plan is feasible pursuant to section      
1129(a)(11) of the Bankruptcy Code, which means that the confirmation of the    
Plan is not likely to be followed by the liquidation or the need for further    
financial reorganization of the Debtors.                                        

               To support their belief in the feasibility of the Plan, the
Debtors have relied upon Pro Forma Financial Projections, which are annexed to  
this Disclosure Statement as Appendix C.                                        

                The Projections indicate that the Reorganized Debtors should
have sufficient cash flow to pay and service their debt obligations, including  
the Exit Facility, and to fund their operations as contemplated by the Business 
Plan. Accordingly, the Debtors believe that the Plan complies with the financial
feasibility standard of section 1129(a)(11) of the Bankruptcy Code.             

        The Projections were not prepared with a view toward
compliance with the published guidelines of the American Institute of Certified 
Public Accountants or any other regulatory or professional agency or body or    
generally accepted accounting principles. Furthermore, the Debtors' independent 
certified public accountants have not compiled or examined the Projections and  
accordingly do not express any opinion or any other form of assurance with      
respect thereto and assume no responsibility for the Projections.               

                  The Projections assume that (i) the Plan will be confirmed and
consummated in accordance with its terms, (ii) there will be no material change 
in legislation or regulations, or the administration thereof, including         
environmental legislation or regulations, that will have an unexpected effect on
the operations of the Reorganized Debtors, (iii) there will be no change in     
United States generally accepted accounting principles that will have a material
effect on the reported financial results of the Reorganized Debtors, and (iv)   
there will be no material contingent or unliquidated litigation or indemnity    
claims applicable to the Reorganized Debtors. To the extent that the assumptions
inherent in the Projections are based upon future business decisions and        
objectives, they are subject to change. In addition, although they are presented
with numerical specificity and considered reasonable by the Debtors when taken  
as a whole, the assumptions and estimates underlying the Projections are subject
to significant business, economic and competitive uncertainties and             
contingencies, many of which will be beyond the control of the Reorganized      
Debtors. Accordingly, the Projections are only an estimate that are necessarily 
speculative in nature. It can be expected that some or all of the assumptions in
the Projections will not be realized and that actual results will vary from the 
Projections, which variations may be material and are likely to increase over   
time. The Projections should therefore not be regarded as a representation by   
the Debtors or any other person that the results set forth in the Projections   
will be achieved. In light of the foregoing, readers are cautioned not to place 
undue reliance on the Projections. The Projections should be read together with 
the information in SECTION V.L of the Disclosure Statement , which summarizes   
the Business Plan and certain assumptions underlying the Projections, as well as
SECTION VIII of the Disclosure Statement entitled "Certain Factors to be        
Considered," which sets forth important factors that could cause actual results 
to differ from those in the Projections.                                        

           WGI is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended, and in accordance therewith files  
periodic reports and other information with the SEC relating to its business,   
financial statements and other matters. Such filings will not include projected 
financial information. The Debtors do not intend to update or otherwise revise  
the Projections, including any revisions to reflect events or circumstances     
existing or arising after the date of this Disclosure Statement or to reflect   
the occurrence of unanticipated events, even if any or all of the underlying    
assumptions do not come to fruition. Furthermore, the Debtors do not intend to  
update or revise the Projections to reflect changes in general economic or      
industry conditions.                                                            

                 SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995: The Projections contain statements which constitute         
"forward-looking statements" within the meaning of the Securities Act of 1933   
and the Securities Exchange Act of 1934, as amended by the Private Securities   
Litigation Reform Act of 1995. "Forward-looking statements" in the Projections  
include the intent, belief or current expectations of the Debtors and members of
their management team with respect to the                                       

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timing of, completion of and scope of the current restructuring, reorganization 
plan, Business Plan, bank financing, and debt and equity market conditions and  
the Debtors' future liquidity, as well as the assumptions upon which such       
statements are based. While the Debtors believe that the expectations are based 
on reasonable assumptions within the bounds of their knowledge of their business
and operations, parties in interest are cautioned that any such forward-looking 
statements are not guarantees of future performance, and involve risks and      
uncertainties, and that actual results may differ materially from those         
contemplated by such forward-looking statements. Important factors currently    
known to management that could cause actual results to differ materially from   
those contemplated by the forward-looking statements in the Projections include,
but are not limited to, further adverse developments with respect to the        
Debtors' liquidity position or operations of the Debtors' various businesses,   
adverse developments in the Debtors' efforts to renegotiate their funding and   
adverse developments in the bank financing or public or private markets for debt
or equity securities, or adverse developments in the timing or results of the   
Debtors' Business Plan (including the time line to emerge from Chapter 11), the 
difficulty in controlling industry costs and integrating new operations, the    
ability of the Debtors to realize the anticipated general and administrative    
expense savings and overhead reductions presently contemplated, the ability of  
the Debtors to return the Debtors' operations to profitability, the level and   
nature of any restructuring and other one-time charges, the difficulty in       
estimating costs relating to exiting certain markets and consolidating and      
closing certain operations, and the possible negative effects of a change in    
applicable legislation.                                                         

B.       ACCEPTANCE OF THE PLAN                                                 

                As a condition to confirmation, the Bankruptcy Code requires
that each Class of Impaired Claims vote to accept the Plan, except under certain
circumstances.                                                                  

                  Section 1126(c) of the Bankruptcy Code defines acceptance of a
plan by a class of impaired claims as acceptance by holders of at least         
two-thirds (2/3) in dollar amount and more than one-half (1/2) in number of     
claims in that class, but for that purpose counts only those who actually vote  
to accept or to reject the Plan. Thus, Class 6 and 7 will have voted to accept  
the Plan only if two-thirds (2/3) in amount and a majority in number actually   
voting in each Class cast their Ballots in favor of acceptance. Holders of      
Claims who fail to vote are not counted as either accepting or rejecting a plan.

C.       BEST INTERESTS TEST                                                    

                As noted above, even if a plan is accepted by the holders of
each class of claims and interests, the Bankruptcy Code requires a bankruptcy   
court to determine that the plan is in the best interests of all holders of     
claims or interests that are impaired by the plan and that have not accepted the
plan. The "best interests" test, as set forth in section 1129(a)(7) of the      
Bankruptcy Code, requires a bankruptcy court to find either that all members of 
an impaired class of claims or interests have accepted the plan or that the plan
will provide a member who has not accepted the plan with a recovery of property 
of a value, as of the effective date of the plan, that is not less than the     
amount that such holder would recover if the debtor were liquidated under       
Chapter 7 of the Bankruptcy Code.                                               

             To calculate the probable distribution to holders of each
impaired class of claims and interests if the Debtors were liquidated under     
Chapter 7, a bankruptcy court must first determine the aggregate dollar amount  
that would be generated from a debtor's assets if its Chapter 11 cases were     
converted to Chapter 7 cases under the Bankruptcy Code. This "liquidation value"
would consist primarily of the proceeds from a forced sale of the debtor's      
assets by a Chapter 7 trustee.                                                  

        The Creditors' Committee has asserted that under the
circumstances a Chapter 7 trustee could sell the Debtors' business units as     
going concerns and that the Liquidation Analysis understates the value of the   
Debtors. The Debtors dispute the assertion that a sale of the Debtors' business 
units as going concerns in Chapter 7 would be possible.                         

          The amount of liquidation value available to unsecured
creditors would be reduced by, first, the claims of secured creditors to the    
extent of the value of their collateral, and, second, by the costs and expenses 
of liquidation, as well as by other administrative expenses and costs of both   
the Chapter 7 cases and the Chapter 11 cases. Costs of liquidation under Chapter
7 of the Bankruptcy Code would include the compensation of a trustee, as well as
of counsel and other professionals retained by the trustee, asset disposition   
expenses, all unpaid expenses incurred by the debtor in its Chapter 11 cases    
(such as compensation of attorneys, financial advisors and accountants) that are
allowed in the Chapter 7 cases, litigation costs, and claims arising from the   
operations of the debtor during the pendency of the Chapter 11 cases. The       
liquidation itself would trigger certain priority payments that otherwise would 
be due in the ordinary course of business. Those priority claims would be paid  
in full from the liquidation proceeds before the balance would be made available
to pay general claims or to make any distribution in respect of equity          
interests. The liquidation would also prompt the rejection of a large number of 
executory contracts and unexpired leases and thereby significantly enlarge the  
total pool of unsecured claims by reason of resulting rejection claims.         

              Once the court ascertains the recoveries in liquidation of
secured creditors and priority claimants, it must determine the                 

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probable distribution to general unsecured creditors and equity security holders
from the remaining available proceeds in liquidation. If such probable          
distribution has a value greater than the distributions to be received by such  
creditors and equity security holders under the plan, then the plan is not in   
the best interests of creditors and equity security holders.                    

D.       LIQUIDATION ANALYSIS                                                   

         In order to determine the amount of liquidation value
available to creditors, the Debtors, with the assistance of their financial     
advisor, Zolfo Cooper, prepared a liquidation analysis, annexed hereto as       
APPENDIX B (the "Liquidation Analysis"), which concludes that in a Chapter 7    
liquidation, holders of prepetition Claims would not receive any recovery. This 
conclusion is premised upon the assumptions set forth in APPENDIX B, which the  
Debtors and Zolfo Cooper believe are reasonable.                                

               Notwithstanding the foregoing, the Debtors believe that any
liquidation analysis with respect to the Debtors is inherently speculative. The 
liquidation analysis for the Debtors necessarily contains estimates of the net  
proceeds that would be received from a forced sale of assets and\or business    
units, as well as the amount of Claims that will ultimately become Allowed      
Claims. Claims estimates are based solely upon the Debtors' incomplete review of
any Claims filed and the Debtors' books and records. No Order or finding has    
been entered by the Bankruptcy Court estimating or otherwise fixing the amount  
of Claims at the projected amounts of Allowed Claims set forth in the           
liquidation analysis. In preparing the liquidation analysis, the Debtors have   
projected an amount of Allowed Claims that is at the lowest end of a range of   
reasonableness such that, for purposes of the liquidation analysis, the largest 
possible Chapter 7 liquidation dividend to holders of Allowed Claims can be     
assessed. The estimate of the amount of Allowed Claims set forth in the         
liquidation analysis should not be relied on for any other purpose, including,  
without limitation, any determination of the value of any distribution to be    
made on account of Allowed Claims under the Plan.                               

E.       VALUATION OF THE REORGANIZED DEBTORS                                   

                In conjunction with the Plan, the Debtors determined that it
was necessary to estimate post-confirmation values for the enterprise of        
Reorganized WGI and its subsidiaries (the "Reorganized Company") and the New    
Common Shares. Accordingly, the Debtors directed their investment banker,       
Lazard, to prepare a valuation analysis the Reorganized Company and the New     
Common Shares for purposes of this Disclosure Statement.                        

                Based in part on information provided by the Company, Lazard
has concluded that the value of the Company (exclusive of the Raytheon Claims)  
is between $470 and $640 million, with a midpoint of $555 million. This midpoint
amount is less than the amount of funded debt owed to the Prepetition Secured   
Lenders. In preparing its analyses, Lazard (1) reviewed certain recent publicly 
available financial statements of the Debtors; (2) reviewed certain financial   
projections prepared by the Debtors for the operations of the Reorganized       
Company, including the Projections set forth in APPENDIX C annexed to this      
Disclosure Statement; (3) reviewed the Debtors' assumptions underlying such     
projections; (4) considered the market values of publicly traded companies that 
Lazard and the Debtors believe are in businesses reasonably comparable to the   
operating business of the Reorganized Company; (5) considered certain economic  
and industry information relevant to the operating business of the Debtors; (6) 
discussed the current operations and prospects of the operating business with   
the Debtors; and (7) made such other examinations and performed such other      
analyses as Lazard deemed necessary or appropriate for the purpose of its       
valuation.                                                                      

                  In preparing its analyses, Lazard has relied upon the accuracy
and completeness of all of the financial and other information that was         
available to it from public sources and that was provided to Lazard by the      
Debtors or their representatives, and has not assumed any responsibility for    
independent verification of any such information. With respect to the financial 
projections that have been supplied to Lazard, Lazard has assumed the accuracy  
thereof and that such projections have been prepared reasonably in good faith   
and on a basis reflecting the best currently available estimates and judgments  
of the Debtors as to the future operating and financial performance of the      
Debtors. Such projections assume the Debtors will operate their businesses as   
reflected in their Business Plan and that such businesses perform as expected in
the Business Plan. To the extent that the Debtors operate more or fewer         
businesses during the projection period and to the extent that all or a portion 
of the businesses perform at levels inconsistent with those expected in the     
Business Plan, such adjustments may have a material impact on the operating     
projections and valuations as presented herein. Lazard has not made or obtained 
any independent evaluation of the Reorganized Debtors' assets, nor did Lazard   
verify any of the information it reviewed.                                      

            The Creditors' Committee has engaged financial advisors,
Chanin Capital Partners ("CCP") and has requested that CCP prepare an           
independent evaluation of the estimated enterprise value of the Debtors, using  
multiples, discounted cash flow, and similar transaction analyses. CCP has not  
completed its analysis, but has determined on a preliminary basis that the      
enterprise valuation of the Company on both a break-up valuation and a          
standalone valuation is substantially in excess of the amount necessary to      
retire the DIP Loan and to fully compensate the classes of claims senior to the 
Allowed Class 7 Claims. Other parties in interest, including Mitsubishi, have   
similarly asserted that the enterprise value of the Company is higher than that 
asserted by the Debtors in the Plan. The Debtors and their                      

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advisors dispute that CCP's analysis and conclusion is correct. If CCP's        
determination of enterprise value is determined to be correct, the Creditors'   
Committee has asserted that the Plan cannot be confirmed in the event it is     
rejected by the holders of Allowed Class 7 Claims because it will               
over-compensate the holders of Allowed Class 6 Claims and, accordingly, will not
be fair and equitable as required by section 1129(b) of the Bankruptcy Code.    

1.       REORGANIZED COMPANY                                  

                With respect to the valuation of the Reorganized Company, in
addition to the foregoing, Lazard has relied upon the following assumptions:    

         o        the Reorganized Company's enterprise valuation consists of the
                aggregate enterprise value of Reorganized WGI and its direct
       and indirect subsidiaries, including the Non-Debtor
Subsidiaries.                               

  o        The enterprise valuation range indicated represents the
                enterprise value of the Reorganized Company, and assumes the
                  pro forma debt levels (as set forth in the Projections annexed
               hereto as APPENDIX C) adjusted for ownership percentages to
calculate a range of equity value.          

      o        WGI and the other Debtors will emerge from Chapter 11 on or
about September 30, 2001.                   

     o        The projections for the Reorganized Company are predicated
           upon the assumption that WGI will be able to obtain all
               necessary financing, as described herein, and that no asset
                sales other than those contemplated to be consummated by the
          Company prior to the Effective Date, or assumed in the
         Projections, will be required to meet the Reorganized
             Company's ongoing financial requirements. Lazard makes no
         representations as to whether the Company will obtain
               financing or consummate such asset sales or as to the terms
                 upon which such financing may be obtained or such asset sales
may be consummated.                         

       o        The present senior management of WGI will continue following
              consummation of the Plan, and general financial and market
                conditions as of the assumed Effective Date of the Plan will
                not differ materially from those conditions prevailing as of
the date of this Disclosure Statement.      

           Lazard's valuation represents a hypothetical value that
reflects the estimated intrinsic value of the Company derived through the       
application of various valuation techniques. Such analysis does not purport to  
represent valuation levels which would be achieved in, or assigned by, the      
public markets for debt and equity securities or private markets for            
corporations. Estimates of enterprise value do not purport to be appraisals or  
necessarily reflect the values which may be realized if assets are sold as a    
going concern, in liquidation, or otherwise. Lazard's estimate necessarily is   
based on economic, market, financial and other conditions as they exist on, and 
on the information made available to it as of, the date of this Disclosure      
Statement. It should be understood that, although subsequent developments may   
affect Lazard's conclusions, Lazard does not have any obligation and does not   
intend to update, revise or reaffirm its estimate.                              

2.       SUMMARY OF FINANCIAL ANALYSIS                        

                  The following is a brief summary of certain financial analyses
performed by Lazard to arrive at its estimation of the enterprise value of the  
Reorganized Company. Lazard performed certain procedures, including each of the 
financial analyses described below, and reviewed with the management of WGI the 
assumptions on which such analyses were based and other factors, including the  
projected financial results of the Reorganized Company. Lazard's estimate of    
enterprise valuation must be considered as a whole and selecting just one       
methodology or portions of the analysis, without considering the analysis as a  
whole, could create a misleading or incomplete conclusion as to enterprise      
value.                                                                          

             ANALYSIS OF CERTAIN PUBLICLY TRADED COMPANIES. To provide
contextual data and comparative market information, Lazard compared selected    
projected operating and financial ratios for the Reorganized Company to the     
corresponding data and ratios of a number of comparable public companies        
("Selected Companies") whose securities are publicly traded and which Lazard    
believes have operating, market and trading characteristics similar to what     
might be expected of the Reorganized Company. Such data and ratios include the  
enterprise value of such Selected Companies as multiples of revenues, EBITDA and
EBIT for historical and, where available, the projected periods.                

            Although the Selected Companies were used for comparison
purposes, none of such companies is directly comparable to the Reorganized      
Company. Accordingly, an analysis of the results of such a comparison is not    
purely mathematical, but instead involves                                       

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complex considerations and judgments concerning differences in historical and   
projected financial and operating characteristics of the Selected Companies and 
other factors that could affect the value of the Selected Companies or the      
Reorganized Company to which they are being compared.                           

           DISCOUNTED CASH FLOW ANALYSIS. The discounted cash flow
("DCF") valuation methodology relates the value of an asset or business to the  
present value of expected future cash flows to be generated by that asset or    
business. The DCF methodology is a "forward looking" approach that discounts the
expected future cash flows by a theoretical or observed discount rate determined
by calculating the average cost of debt and equity for publicly traded companies
that are similar to the Debtors. This approach has two components: the present  
value of the projected un-levered free cash flows for a determined period; and  
the present value of the terminal value of cash flows for a determined period   
(representing firm value beyond the time horizon of the projections).           

            As the estimated cash flows, estimated discount rate and
expected capital structure of the Reorganized Company are used to derive a      
potential value, an analysis of the results of such an estimate is not purely   
mathematical, but instead involves complex considerations and judgments         
concerning potential variance in the projected financial and operating          
characteristics of the Reorganized Company and other factors that could affect  
the future prospects and cost of capital considerations for the Reorganized     
Company.                                                                        

          PRECEDENT TRANSACTIONS ANALYSIS. Precedent transaction
analysis estimates value by examining public merger and acquisition             
transactions. An analysis of the disclosed purchase price as a multiple of      
various operating statistics reveals industry sales multiples for companies in  
similar lines of businesses to the Debtors. These transaction multiples are     
calculated based on the purchase price (including debt assumed) paid to acquire 
companies that are comparable to the Debtors. These multiples are then applied  
to the Debtors' key operating statistics to determine the total enterprise value
or value to a potential strategic buyer.                                        

                 The summary set forth above does not purport to be a complete
description of the analyses performed by Lazard. The preparation of an estimate 
involves various determinations as to the most appropriate and relevant methods 
of financial analysis and the application of these methods in the particular    
circumstances and, therefore, such an estimate is not readily susceptible to    
summary description. In performing its analyses, Lazard and the Debtors made    
numerous assumptions with respect to industry performance, business and economic
conditions and other matters. The analyses performed by Lazard are not          
necessarily indicative of actual values or future results, which may be         
significantly more or less favorable than suggested by such analyses.           

           Lazard relied on the accuracy and reasonableness of the
projections and the underlying assumptions as prepared by the Debtors. Lazard's 
valuation assumes that operating results projected by the Debtors will be       
achieved in all material respects, including new work booked revenue growth,    
improvements in operating margins, earnings and cash flow, improvement in       
techniques for managing working capital, expenses and other elements. To the    
extent that the valuation is dependent upon the Debtors' achievement of the     
projections, the valuation must be considered speculative.                      

F.       APPLICATION OF THE "BEST INTERESTS" OF CREDITORS TEST TO THE           
LIQUIDATION ANALYSIS AND THE VALUATION                        

                It is impossible to determine with any specificity the value
each creditor will receive as a percentage of its Allowed Claim. This difficulty
in estimating the value of recoveries is due to, among other things, the        
inherent uncertainty with respect to the Trust Recoveries and the lack of any   
public market for the New Common Shares.                                        

               Notwithstanding the difficulty in quantifying recoveries to
holders of Allowed Claims with precision, the Debtors believe that the financial
disclosures and projections contained herein imply a greater or equal recovery  
to holders of Claims in Impaired Classes than the recovery available in a       
Chapter 7 liquidation. As set forth in the Liquidation Analysis, holders of     
Allowed Claims in Class 6 and Class 7 are estimated not to receive any recovery 
in a Chapter 7 liquidation, except potentially from recovery on the Raytheon    
Claims, if any. Conversely, under the Plan, holders of Allowed Claims in Class 6
will receive a recovery of New Common Shares and holders of Allowed Claims in   
Class 7 will receive the net proceeds of the Raytheon Claims, the litigation of 
which will be funded with $20 million.                                          

              Accordingly, the Debtors believe that the "best interests"
test of section 1129 of the Bankruptcy Code is satisfied. The Committee has     
asserted that it believes the proper measure of liquidation value under the     
circumstances would be a sale of the business units of the Debtors as going     
concerns. The Debtors do not believe that a sale of business units as going     
concerns in Chapter 7 would be possible.                                        

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G.       CONFIRMATION WITHOUT ACCEPTANCE OF ALL IMPAIRED CLASSES: THE "CRAMDOWN"
ALTERNATIVE                                                   

             In view of the deemed rejection by holders of Class 8 WGI
Interests and Subordinated Claims, the Debtors will seek confirmation of the    
Plan pursuant to the "cramdown" provisions of the Bankruptcy Code. The Debtors  
further reserve the right to seek confirmation of the Plan with respect to the  
holders of Class 7 Claims in the event such holders vote to reject the Plan.    
Specifically, section 1129(b) of the Bankruptcy Code provides that a plan can be
confirmed even if the plan is not accepted by all impaired classes, as long as  
at least one impaired class of claims has accepted it. The Bankruptcy Court may 
confirm a plan at the request of the debtors if the plan "does not discriminate 
unfairly" and is "fair and equitable" as to each impaired class that has not    
accepted the plan. A plan does not discriminate unfairly within the meaning of  
the Bankruptcy Code if a dissenting class is treated equally with respect to    
other classes of equal rank.                                                    

               The Debtors believe the Plan does not discriminate unfairly
with respect to holders of Class 7 Claims and Class 8 WGI Interests and         
Subordinated Claims. Class 8 includes all holders of equity interests and       
subordinated claims under section 510(b) or (c) of the Bankruptcy Code, holders 
of which are not entitled to payment under the absolute priority rule until all 
creditors have been paid in full. Thus, because all interestholders and         
subordinated claimholders are similarly treated, there is no unfair             
discrimination with respect to holders of Class 8 WGI Interests and Subordinated
Claims.                                                                         

                As discussed in more detail in SECTION VI.C.2.(a), under the
Plan, Unimpaired Unsecured Claims in Class 3 consist only of Employee Claims and
provides full payment on account of such Claims. The Plan further classifies    
holders of General Unsecured Claims (which include Lender Deficiency Claims, Old
Note Claims, and Raytheon Asserted Claims) in Class 7 and provides less than    
full recovery on such Claims. Although the Plan thus treats Claims of unsecured 
creditors differently in Class 3 than in Class 7, the Debtors believe that      
different treatment is fair and appropriate. The Debtors believe that there is  
ample basis for Employee Claims to be paid in full and, therefore, classified as
Unimpaired based upon the substantial benefits to the Company's operations of   
maintaining high employee morale and minimizing employee turnover, particularly 
in a construction company whose primary assets are its employees.               

                  A plan is fair and equitable as to a class of unsecured claims
which rejects a plan if the plan provides (a) for each holder of a claim        
included in the rejecting class to receive or retain on account of that claim   
property that has a value, as of the effective date of the plan, equal to the   
allowed amount of such claim; or (b) that the holder of any claim or interest   
that is junior to the claims of such class will not receive or retain on account
of such junior claim or interest any property at all.                           

                  A plan is fair and equitable as to a class of equity interests
that rejects a plan if the plan provides (a) that each holder of an interest    
included in the rejecting class receive or retain on account of that interest   
property that has a value, as of the effective date of the plan, equal to the   
greatest of the allowed amount of any fixed liquidation preference to which such
holder is entitled, any fixed redemption price to which such holder is entitled,
or the value of such interest; or (b) that the holder of any interest that is   
junior to the interests of such class will not receive or retain under the plan 
on account of such junior interest any property at all.                         

         The Debtors believe that they will meet the "fair and
equitable" requirements of section 1129(b) with respect to holders of Class 7   
Claims and Class 8 WGI Interests and Subordinated Claims.                       

                  The Creditors' Committee and certain other parties in interest
have asserted that the Plan violates the absolute priority rule of section      
1129(b)(2)(B)(ii) of the Bankruptcy Code because, under the Washington          
Agreement, Mr. Washington will receive a distribution of options. The Debtors   
and the Prepetition Secured Lenders dispute this assertion and assert that      
because the consideration to be provided to Mr. Washington is being provided    
solely in connection for future services to be rendered, he is not receiving or 
retaining any property under the Plan on account of his Old Common Stock. The   
Creditors' Committee also asserts that the Plan is not fair and equitable in    
that it overcompensates Class 6 and that it discriminates unfairly against Class
7.                                                                              

        XII.   ALTERNATIVES TO CONFIRMATION AND CONSUMMATION OF THE PLAN

                The Debtors believe that the Plan affords holders of Class 6
and 7 Claims the potential for the greatest realization on the Debtors' assets  
and, therefore, is in the best interests of such holders. The Plan as presented 
is the result of considerable negotiations between WGI and the steering         
committee of Prepetition Secured Lenders.                                       

               If, however, the requisite acceptances are not received, or
the Plan is not confirmed and consummated, the theoretical alternatives include:
(a) formulation of an alternative plan or plans of reorganization, or (b)       
liquidation of the Debtors under Chapter 7 or 11 of the Bankruptcy Code.        

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A.       ALTERNATIVE PLAN(S) OF REORGANIZATION                                  

                If the requisite acceptances are not received or if the Plan
is not confirmed, the Debtors (or, if the Debtors' exclusive periods in which to
file and solicit acceptances of a plan of reorganization have expired, any other
party in interest) could attempt to formulate and propose a different plan or   
plans of reorganization. Such a plan or plan(s) might involve either a          
reorganization and continuation of the Debtors' businesses or an orderly        
liquidation of assets. Additionally, it is not clear whether the Debtors could  
survive as going concerns in a protracted process to confirm an alternative plan
of reorganization. SEE SECTION IV.C.                                            

                  With respect to an alternative plan, the Debtors have explored
various other alternatives in connection with the extensive negotiation process 
involved in the formulation and development of the Plan. The Debtors believe    
that the Plan enables creditors to realize the greatest possible value under the
circumstances, and, that as compared to any alternative plan of reorganization, 
has the greatest chance to be confirmed and consummated.                        

B.       LIQUIDATION UNDER CHAPTER 7 OR CHAPTER 11                              

                  If no plan is confirmed, the Chapter 11 Cases may be converted
to cases under Chapter 7 of the Bankruptcy Code, pursuant to which a trustee    
would be elected or appointed to liquidate the Debtors' assets for distribution 
to Creditors in accordance with the priorities established by the Bankruptcy    
Code. It is impossible to predict precisely how the proceeds of the liquidation 
would be distributed to the respective holders of Claims against or Interests in
the Debtors.                                                                    

              The Debtors believe that in a liquidation under Chapter 7,
additional administrative expenses involved in the appointment of a trustee or  
trustees and attorneys, accountants and other professionals to assist such      
trustees would cause a substantial diminution in the value of the Debtors'      
Estates. The assets available for distribution to creditors would be reduced by 
such additional expenses and by Claims, some of which would be entitled to      
priority, which would arise by reason of the liquidation and from the rejection 
of leases and other executory contracts in connection with the cessation of     
operations and the failure to realize the greater going concern value of the    
Debtors' assets. More importantly, as set forth in APPENDIX B, consequences of  
conversion to a Chapter 7 liquidation would likely result in the immediate      
cessation of the Debtors' businesses, leaving no value for prepetition          
creditors.                                                                      

        The Debtors could also be liquidated pursuant to the
provisions of a Chapter 11 plan of reorganization. In a liquidation under       
Chapter 11, the Debtors' assets could theoretically be sold in an orderly       
fashion over a more extended period of time than in a liquidation under Chapter 
7. Because there will be no need to appoint a Chapter 7 trustee and hire new    
professionals, a Chapter 11 liquidation might be less costly than a Chapter 7   
liquidation and thus provide larger net distributions to creditors than in a    
Chapter 7 liquidation. Any recovery in a Chapter 11 liquidation, while          
potentially greater than in a Chapter 7 liquidation, would also be highly       
uncertain.                                                                      

               Although preferable to a Chapter 7 liquidation, the Debtors
believe that any alternative liquidation under Chapter 11 would be a much less  
attractive alternative to creditors than the Plan. As discussed elsewhere in the
Disclosure Statement, the Debtors actively solicited interest from third parties
for potential transactions involving some or all business units, and remained   
open to expressions of interest during the Chapter 11 Cases. No bids were       
received that the Debtors believe would have provided greater recoveries that   
under the Plan. Certain parties in interest have asserted that they believe     
there is a possibility of liquidating certain of the Debtors' businesses in     
chapter 11 and providing a greater recovery to creditors than under the Plan.   
The Creditors' Committee and certain other parties also dispute the adequacy of 
the Debtors' prepetition efforts to sell all or part of their businesses. The   
Debtors contest each of these assertions.                                       

XIII.  THE SOLICITATION; VOTING PROCEDURE 

A.       PARTIES IN INTEREST ENTITLED TO VOTE                                   

                Under section 1124 of the Bankruptcy Code, a class of claims
or interests is deemed to be "impaired" under a plan unless (i) the plan leaves 
unaltered the legal, equitable, and contractual rights to which such claim or   
interest entitles the holder thereof or (ii) notwithstanding any legal right to 
an accelerated payment of such claim or interest, the plan cures all existing   
defaults (other than defaults resulting from the occurrence of events of        
bankruptcy) and reinstates the maturity of such claim or interest as it existed 
before the default.                                                             

                  In general, a holder of a claim or interest may vote to accept
or to reject a plan if (i) the claim or interest is "allowed," which means      
generally that no party in interest has objected to such claim or interest, and 
(ii) the claim or interest is impaired by the plan. If, however, the holder of  
an impaired claim or interest will not receive or retain any distribution under 
the plan on account of such claim or interest, the Bankruptcy Code deems such   
holder to have rejected the plan, and, accordingly, holders of such claims and  
interests do not                                                                

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actually vote on the plan. If a claim or interest is not impaired by the plan,  
the Bankruptcy Code deems the holder of such claim or interest to have accepted 
the plan and, accordingly, holders of such claims and interests are not entitled
to vote on the plan.                                                            

B.       CLASSES IMPAIRED UNDER THE PLAN                                        

                Classes 6 and 7 are entitled to vote to accept or reject the
Plan. By operation of law, each Unimpaired Class of Claims is deemed to have    
accepted the Plan and, therefore, is not entitled to vote to accept or reject   
the Plan. By operation of law, Class 8 is deemed to have rejected the Plan and  
therefore is not entitled to vote to accept or reject the Plan.                 

C.       WAIVERS OF DEFECTS, IRREGULARITIES, ETC.                               

          Unless otherwise directed by the Bankruptcy Court, all
questions as to the validity, form, eligibility (including time of receipt),    
acceptance, and revocation or withdrawal of Ballots will be determined by the   
Voting Agent and the Debtors in their sole discretion, which determination will 
be final and binding. As indicated below under "Withdrawal of Ballots;          
Revocation," effective withdrawals of Ballots must be delivered to the Voting   
Agent prior to the Voting Deadline. The Debtors reserve the absolute right to   
contest the validity of any such withdrawal. The Debtors also reserve the right 
to reject any and all Ballots not in proper form, the acceptance of which would,
in the opinion of the Debtors or their counsel, be unlawful. The Debtors further
reserve the right to waive any defects or irregularities or conditions of       
delivery as to any particular Ballot. The interpretation (including the Ballot  
and the respective instructions thereto) by the Debtors, unless otherwise       
directed by the Bankruptcy Court, will be final and binding on all parties.     
Unless waived, any defects or irregularities in connection with deliveries of   
Ballots must be cured within such time as the Debtors (or the Bankruptcy Court) 
determine. Neither the Debtors nor any other person will be under any duty to   
provide notification of defects or irregularities with respect to deliveries of 
Ballots nor will any of them incur any liabilities for failure to provide such  
notification. Unless otherwise directed by the Bankruptcy Court, delivery of    
such Ballots will not be deemed to have been made until such irregularities have
been cured or waived. Ballots previously furnished (and as to which any         
irregularities have not theretofore been cured or waived) will be invalidated.  

D.       WITHDRAWAL OF BALLOTS; REVOCATION                                      

                 Any party who has delivered a valid Ballot for the acceptance
or rejection of the Plan may withdraw such acceptance or rejection by delivering
a written notice of withdrawal to the Voting Agent at any time prior to the     
Voting Deadline. A notice of withdrawal, to be valid, must (i) contain the      
description of the Claim(s) to which it relates and the aggregate principal     
amount represented by such Claim(s), (ii) be signed by the withdrawing party in 
the same manner as the Ballot being withdrawn, (iii) contain a certification    
that the withdrawing party owns the Claim(s) and possesses the right to withdraw
the vote sought to be withdrawn and (iv) be received by the Voting Agent in a   
timely manner at the address set forth below. The Debtors intend to consult with
the Voting Agent to determine whether any withdrawals of Ballots were received  
and whether the Requisite Acceptances of the Plan have been received. As stated 
above, the Debtors expressly reserve the absolute right to contest the validity 
of any such withdrawals of Ballots.                                             

                  Unless otherwise directed by the Bankruptcy Court, a purported
notice of withdrawal of Ballots which is not received in a timely manner by the 
Voting Agent will not be effective to withdraw a previously cast Ballot.        

              Any party who has previously submitted to the Voting Agent
prior to the Voting Deadline a properly completed Ballot may revoke such Ballot 
and change his or its vote by submitting to the Voting Agent prior to the Voting
Deadline a subsequent properly completed Ballot for acceptance or rejection of  
the Plan. In the case where more than one timely, properly completed Ballot is  
received, only the Ballot which bears the latest date will be counted for       
purposes of determining whether the Requisite Acceptances have been received.   

E.       FURTHER INFORMATION; ADDITIONAL COPIES                                 

                  If you have any questions or require further information about
the voting procedure for voting your Claim or about the packet of material you  
received, or if you wish to obtain an additional copy of the Plan, the          
Disclosure Statement, or any exhibits or appendices to such documents (at your  
own expense, unless otherwise specifically required by Bankruptcy Rule 3017(d)),
please contact the Voting Agent:                                                

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Washington Group International, Inc.
c/o Robert L. Berger & Associates, LLC
PMB 1007
10351 Santa Monica Boulevard, Suite 101A
 Los Angeles, CA 90025
 Phone: (818) 771-7469
 Fax: (818) 905-6542

F.       INTERNET ACCESS TO BANKRUPTCY COURT DOCUMENTS                          

                 Bankruptcy Court documents filed in these Chapter 11 Cases as
well as the Bankruptcy Court's calendar and other administrative matters may be 
found, downloaded and printed from the Bankruptcy Court's website found at      
http//www.nvb.uscourts.gov.                                                     

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XIV. RECOMMENDATION AND CONCLUSION  

                  For all of the reasons set forth in this Disclosure Statement,
the Debtors believe that confirmation and consummation of the Plan is preferable
to all other alternatives. Consequently, the Debtors urge all holders of Class 6
and 7 Claims to vote to ACCEPT the Plan, and to complete and return their       
ballots so that they will be RECEIVED by the Voting Agent on or before 4:00 p.m.
prevailing Pacific Time on the Voting Deadline.                                 

Dated:   July 24, 2001                                                          
Boise, Idaho                                                  

                    WASHINGTON GROUP INTERNATIONAL, INC.
                         (for itself and on behalf of the Debtors)

             By:      /s/ Stephen G. Hanks
                                         ---------------------------------------
              Name:         Stephen G. Hanks
                                         ---------------------------------------
                              Title:   Chief Executive Officer and President
                                         ---------------------------------------

Skadden, Arps, Slate, Meagher & Flom (ILLINOIS)                                 
David S. Kurtz                                                                  
Timothy R. Pohl                                                                 
333 W. Wacker Drive                                                             
Chicago, Illinois 60606-1285                                                    
(312) 407-0700                                                                  

-and-                                                       

SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP                                        
Gregg M. Galardi                                                                
One Rodney Square                                                               
P.O. Box 636                                                                    
Wilmington, Delaware 19899-0636                                                 
(302) 651-3000                                                                  

-and-                                                         

LIONEL, SAWYER & COLLINS                                                        

/s/ Jennifer Smith                                                              
------------------------------------                                            
Jennifer Smith (State Bar No. 610)                                              
Etta L. Walker (State Bar No. 5537)                                             
1100 Bank of America Plaza                                                      
50 W. Liberty Street                                                            
Reno, Nevada 89501                                                              
(775) 788-8666                                                                  

Attorneys for Debtors and Debtors-in-Possession                                 

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APPENDIX A

SECOND AMENDED JOINT PLAN OF REORGANIZATION OF
WASHINGTON GROUP INTERNATIONAL, INC., ET AL.

[SEE EXHIBIT 99.1 TO THIS FORM 8-K] 

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APPENDIX B

LIQUIDATION ANALYSIS

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                                                                      APPENDIX B

CONSOLIDATED WASHINGTON GROUP INTERNATIONAL, INC. 
HYPOTHETICAL CHAPTER 7 LIQUIDATION ANALYSIS 
(IN MILLIONS OF U.S. DOLLARS) 
ESTIMATED AS OF AUGUST 3, 2001

                                                        [Enlarge/Download Table]

                                       Projected Net                                                                       
                                         Book Value                        Estimated        Recovery Per                   
                                           as of          Estimated       Non-Foreign      centage on Non-     Estimated   
                                       August 3, 2001      Foreign            & JV          Foreign & JV      Liquidation  
                            Notes       (Unaudited)         & JV %         Remainder          Remainder         Proceeds   
                          ---------- ------------------ --------------  ----------------  -----------------  --------------
                                                                                                                           
Cash                          1             75.2            81.8%             13.7             100.0%             13.7     

Billed and unbilled           2            874.2            25.4%            652.4              20.0%            130.5     
receivables                                                                                                                

Inventories                   3             40.5            79.6%             8.3               0.0%              0.0      

Other current assets          4            227.5            11.3%            201.7              0.0%              0.0      

Investment in joint           5            118.1             0.0%            118.1              0.0%              0.0      
ventures                                                                                                                   

Property and equipment, net   6            230.5            16.7%            192.0              15.0%             28.8     

Other assets                  7           1,527.7           16.5%           1,275.7             0.0%              0.0      

Total                                     3,093.7                           2,416.9                              173.0     

Less:                                                                                                                      
Estimated costs of            8                                                                                  (76.3)    
liquidation                                                                                                                

Estimated DIP                 9                                                                                 (101.1)    
Facility claim                                                                                                             

Amount available for                                                                                             (4.4)     
distribution                                                                                                               

Secured lender claims         10                                                                                 573.0     

Secured letters of credit     11                                                                                 130.0     

Shortfall to secured                                                                                            (703.0)    
lender claims                                                                                                              

Available to chapter 11                                                                                                    
administrative, priority                                                                                         $ 0.0     
and unsecured claims                                                                                                       

THIS ANALYSIS SHOULD BE READ ONLY IN CONJUNCTION WITH THE ASSUMPTIONS,          
QUALIFICATIONS AND EXPLANATIONS AS SET OUT IN THE ATTACHED ASSUMPTIONS AND THE  
DISCUSSION UNDER SECTION XI.C "FEASIBILITY OF THE PLAN AND BEST INTERESTS OF    
CREDITORS - BEST INTEREST TEST" AND SECTION XII "ALTERNATIVES TO AND            
CONSUMMATION OF THE PLAN".                                                      

 This Liquidation Analysis reflects an estimate by Management of
Washington Group International, Inc. (the "Management and "WGI," respectively)  
and Zolfo Cooper, LLC of the proceeds that would be realized if the Debtors were
to                                                                              

Appendix B-1

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be liquidated in accordance with chapter 7 of the United States Bankruptcy Code 
("Chapter 7"). This analysis assumes that if the Debtors' cases were converted  
to Chapter 7, the Non-Debtor Subsidiaries would also have to be liquidated. This
Liquidation Analysis assumes that the Chapter 11 Cases are converted to         
liquidations under Chapter 7 as of July 31, 2001.                               

     The Liquidation Analysis is premised upon a number of estimates and
assumptions that, although developed and considered reasonable by Management,   
are inherently subject to significant business, economic and competitive        
uncertainties and contingencies beyond the control of WGI and Management, and   
upon assumptions with respect to a liquidation, decisions which could be subject
to change. Accordingly, there can be no assurance that the values reflected in  
the Liquidation Analysis would be realized if consolidated WGI were, in fact, to
undergo such a liquidation, nor can there be any assurance that the Bankruptcy  
Court will accept such analysis or concur with such assumptions in making its   
determinations under section 1129(a) of the Bankruptcy Code. In addition, any   
liquidation ultimately undertaken would take place under future circumstances   
that cannot presently be predicted with certainty. Accordingly, although the    
analysis that follows is necessarily presented with numerical specificity, if   
consolidated WGI's estates were in fact liquidated, the actual liquidation      
proceeds could vary from the amounts set forth above. Such actual liquidation   
proceeds could be materially higher or lower than the amounts set forth above , 
and no representation or warranty can be or is being made with respect to the   
actual proceeds that would be generated in liquidations of consolidated WGI     
under Chapter 7 of the United States Bankruptcy Code. The liquidation valuations
have prepared solely for purposes of estimating the proceeds available in a     
Chapter 7 and do not represent values that may be appropriate for any other     
purpose, including the values applicable in the context of the Plan. Nothing    
contained in these valuations is intended as or constitutes a concession or     
admission for any purpose other than the presentation of a hypothetical         
liquidation analysis.                                                           

GENERAL ASSUMPTIONS                                                             

   In Chapter 7, a trustee (the "Chapter 7 Trustee") is appointed to
manage the debtors' affairs and conduct a liquidation. This Liquidation Analysis
assumes that no third-party lender would be willing to advance new funds to a   
Chapter 7 Trustee to continue to fund operations of the Company, and            
accordingly, the liquidity available to a Chapter 7 Trustee to administer a     
liquidation would be extremely limited. As a result, in a Chapter 7 liquidation,
the Debtors would be forced to cease substantially all operations almost        
immediately (except for joint ventures that are self-sustaining or funded by    
non-WGI affiliated partners). The likely consequences of the conversion to      
Chapter 7 include the following:                                                

o        The Company's workforce consists of highly trained,  
                 specialized employees, who are highly coveted by competitors.
                With the Company facing certain liquidation, those employees
                  would quickly leave the Company and find employment elsewhere,
            rendering any possibility of continuing operations in an
                effort to complete a going concern sale of business units of
                 the Company highly remote if not impossible. The inability to
       retain employees for a transitional period would be
               exacerbated by concerns over the Com pany's ability to fund
                  ongoing payroll (which averages approximately $120 million per
month).                                     

 o        Assets in foreign entities and joint ventures would be
                  unrecoverable. Foreign laws and local foreign creditor rights,
                 among other things, would make obtaining recoveries on assets
               in foreign locations practically impossible. Joint ventures
                have third party partners with contractual rights that would
              severely restrict access by the Company to assets in joint
                ventures in a liquidation of the Company. Accordingly, it is
               assumed that the only potential recovery on assets would be
                from assets located in domestic, non-joint venture entities.

         o        Many of the Company's contracts are with governmental entities
           that have the right under applicable law to rebid those
              contracts to other parties. It is highly unlikely that any
                  material government contracts could be maintained by a Chapter
7 Trustee for any period of time.           

    o        Outstanding receivables for uncompleted projects would be
              uncollectible. Defaults on bonded projects would result in
           project owners calling on surety bonds issued for their
              benefit, which in turn would trigger equitable subrogation
      rights of bonding companies to receive any project
               receivables. Unpaid vendors and subcontractors would assert
                  mechanics and materialman's liens on project owners' property,
              further reducing any possibility of the Company collecting
outstanding receivables from project owners.

    o        Customers for completed projects with warranties from WGI
would assert warranty claims, and offset    

Appendix B-2

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           payables to the Company against those claims, rendering
        collection of these receivables extremely difficult.

       o        The bulk of fixed assets are located on job sites. These job
           sites are located all around the world, often in remote
             locations, and retrieving such fixed assets in many cases
                  would be extremely difficult. In addition, fixed assets on job
          sites are essential to completion of the projects, and
                 accordingly customers would likely seize the assets remaining
                on the site and seek to prohibit the Company from retrieving
             such assets until project completion, which in many cases
would take months or years.                 

       o        It is highly unlikely that any of the Debtors' joint venture
               partners would agree to continue their partnership with, or
               cooperate with, a Chapter 7 Trustee. Joint venture partners
            would likely assert that the partner ships dissolve as a
             matter of law as well as contract, upon the bankruptcy of
            another partner, and the Chapter 7 Trustee would have to
               commence litigation to contest that assertion. In addition,
               many joint venture and limited liability company agreements
               require ongoing capital to be contributed by the Company to
          fund the subject projects, and contain restrictions on
                  dividends to partners, particularly when the partner is unable
             to meet ongoing funding requirements. Moreover, the joint
              venture agreements (and the Westinghouse Group constituent
              agreements) prohibit the sale by a partner of its interest
             without the other partner's consent, which provisions are
                 likely enforceable under applicable law. As a result of these
                  and other factors, in Chapter 7, the ability of the Company to
                continue to participate in managing the joint ventures or to
                  successfully sell its partnership interests for value would be
negligible.                                 

       o        The Raytheon Claims could be pursued by a Chapter 7 Trustee.
             However, in a Chapter 7 liquidation, there may not be any
                  significant funding to pursue those claims. Moreover, proceeds
                of such claims are pledged to secure the DIP Facility, which
               would result in fewer proceeds of the Raytheon Claims being
                  available to prepetition creditors in Chapter 7 than under the
Plan.                                       

SPECIFIC ASSUMPTIONS                                                            

NOTE 1                                                                          
         Virtually all of consolidated cash is in foreign subsidiaries and joint
ventures. Joint venture agreements contain many restrictions on payments or     
distributions to partners. This analysis assumes that a Chapter 7 trustee would 
only be able to obtain access to cash in domestic, non-joint venture entities,  
because of restrictions contained in joint venture agreements and the rights of 
foreign creditors under local foreign law.                                      

NOTE 2                                                                          
         As noted above, the vast majority of receivables would be uncollectible
in Chapter 7. This analysis optimistically assumes that 20% of receivables of   
non-foreign, non-joint venture entities would be able to be collected by the    
Trustee.                                                                        

NOTE 3                                                                          
    The bulk of the inventories are owned by EMD, which is part of the
Westinghouse Group. The Westinghouse Group is not wholly-owned by the Company. A
Chapter 7 Trustee would have no ability to force the sale of inventory owned by 
the Westinghouse Group. Any value that could conceivably be realized by the     
Debtors from these inventories is solely through the equity interest in the     
Westinghouse Group, which, for the reasons stated above would be unlikely to be 
realizable in a Chapter 7 liquidation.                                          

NOTE 4                                                                          
    Other current assets, consisting primarily of prepaid expenses and
current tax benefits will provide no benefit in a Chapter 7 liquidation.        

NOTE 5                                                                          
   For the reasons set forth above, it is estimated that a Chapter 7
Trustee would be unable to realize any value from the Debtors' historical       
investment in joint ventures or the Westinghouse Group.                         

NOTE 6                                                                          
         For the reasons set forth above, a Chapter 7 Trustee would have extreme
difficulty exercising and control over, and thus being able to sell for value,  
physical assets located at project locations. In addition, even assuming some of
such assets                                                                     

Appendix B-3

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could be physically recovered, fair market value in a forced sale would be      
significantly less than book value.                                             

NOTE 7                                                                          
       Other assets consist primarily of goodwill, which would have no value
in a liquidation.                                                               

NOTE 8                                                                          
     Consists of estimated trustee fees at 2.5% of the net proceeds from
sale of assets/business units, professional fees estimated for 6 months at $2   
million per month, and other wind down costs. It is also assumed that payroll   
accrued but unpaid in the in the amount of $40 million (approximately 10 days of
payroll) would have to be paid.                                                 

NOTE 9                                                                          

         The estimated funded balance on the DIP loan at August 3, 2001 would be
approximately $23.1 million. It is also anticipated that approximately $78      
million in letters of credit will be outstanding under the DIP facility. The    
total obligations under the DIP loan are projected to be 101.1 as of August 3,  
2001.                                                                           

NOTE 10                                                                         

     Secured lender claims reflects the amount outstanding as of June 1,
2001 under the pre-petition credit agreement. Interest has not been accrued on  
secured lender claims since the Petition Date. It is assumed that the secured   
lender claims are properly secured by valid and enforceable substantially all   
liens on assets from which value would be derived on a Chapter 7 liquidation.   

NOTE 11                                                                         

         Secured and outstanding letters of credit under the pre-petition credit
agreement are estimated to be approximately $130.0 million and are assumed to   
called upon the conversion of the Chapter 11 Cases to Chapter 7.                

Appendix B-4

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APPENDIX C

 PRO FORMA FINANCIAL PROJECTIONS

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WASHINGTON GROUP INTERNATIONAL, INC.
PROJECTED FINANCIAL STATEMENTS INDEX

                                                                [Download Table]

   PAGE                                DESCRIPTION                           
-----------  ----------------------------------------------------------------
                                                                             
     2       Consolidated Statements of Operations                           

     3       Consolidated Statements of Operations with Detail by Group      
     4       Consolidated Balance Sheets                                     
     5       Fiscal 2001 Balance Sheets by Group                             
     6       Fiscal 2002 Balance Sheets by Group                             
     7       Fiscal 2003 Balance Sheets by Group                             
     8       Fiscal 2004 Balance Sheets by Group                             
     9       Power Group Comparative Balance Sheets                          
     10      Infrastructure & Mining Group Comparative Balance Sheets        
     11      Industrial Process Group Comparative Balance Sheets             
     12      Government Group Comparative Balance Sheets                     
     13      Corporate Comparative Balance Sheets                            
     14      Consolidated Statements of Cash Flow                            
     15      Fiscal 2001 Combining Statement of Cash Flows                   
     16      Fiscal 2002 Combining Statement of Cash Flows                   
     17      Fiscal 2003 Combining Statement of Cash Flows                   

Appendix C-1

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WASHINGTON GROUP INTERNATIONAL, INC.
2002 - 2004 FINANCIAL PLAN
 CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)

                                                        [Enlarge/Download Table]

-------------------  -----------------  -----------------  -----------------  -----------------
       1997                1998               1999               2000               2001       
      ACTUAL              ACTUAL             ACTUAL             ACTUAL              FCST       
      TOTAL               TOTAL              TOTAL              TOTAL              TOTAL       
-------------------  -----------------  -----------------  -----------------  -----------------
                                                                                               
         1,687,044          1,907,941          2,304,402         3,213,437           3,645,849 
        (1,590,565)        (1,806,981)        (2,180,314)       (3,130,600)         (3,585,486)
                -                  -                   -            56,000              73,000 
-------------------  -----------------  -----------------  -----------------  -----------------
            96,479            100,960            124,088           138,837             133,362 
                 -                  -                  -                 -                   - 
           (22,910)           (24,202)           (25,999)          (37,859)            (48,201)
            (3,578)            (3,597)           (12,576)          (42,005)            (77,610)
                 -                  -                  -           (14,359)            (48,293)
-------------------  -----------------  -----------------  -----------------  -----------------
            69,991             73,162             85,512            44,613             (40,742)
             9,075              5,774              3,429            10,567              12,846 
              (891)              (869)            (7,642)          (38,795)            (64,328)
                 -                  -                  -                 -             226,620 
            (1,118)             3,757              9,681             1,269             (11,066)
-------------------  -----------------  -----------------  -----------------  -----------------
            77,057             81,823             90,981            17,654             123,331 
           (34,540)           (35,460)           (33,911)           (8,012)             (3,621)
           (10,485)            (8,810)            (8,785)           (9,152)            (15,508)
-------------------  -----------------  -----------------  -----------------  -----------------
            32,031             37,553             48,285               490              104,201
===================  =================  =================  =================  =================

                                                        [Enlarge/Download Table]

                                                           ------------------  -----------------  ------------------
                                                                 2002                2003               2004        
                                                                 PLAN                PLAN               PLAN        
                                                                 TOTAL              TOTAL               TOTAL       
                                                           ------------------  -----------------  ------------------
                                                                                                                    
Revenue                                                            3,146,639          3,211,399           3,575,391 
Cost of revenue                                                   (3,006,199)        (3,042,957)         (3,371,730)
Normalized Profit                                                     35,647                842                 800 
                                                           ------------------  -----------------  ------------------
Gross Profit                                                         176,087            169,284             204,461 
Management Adjustment                                                (25,000)                 -                   - 
General and administrative expenses                                  (45,000)           (40,000)            (40,000)
Goodwill                                                                   -                  -                   - 
Merger and reorganization costs                                            -                  -                   - 
                                                           ------------------  -----------------  ------------------
Operating Income                                                     106,087            129,284             164,461 
Investment income                                                      3,812              3,796               3,795 
Interest Expense                                                     (19,953)           (14,871)            (12,583)
Net gain on bankruptcy                                                     -                  -                   - 
Other income (expense), net                                                -                  -                   - 
                                                           ------------------  -----------------  ------------------

Income before income taxes and minority interests                     89,946            118,209             155,673 
Income tax expense                                                   (35,978)           (47,284)            (62,269)
Minority interests in income of consolidated subsidiaries             (9,929)            (9,976)            (10,567)

                                                           ------------------  -----------------  ------------------
Net income                                                            44,039             60,949              82,837 
                                                           ==================  =================  ==================

EBITDA:                                                                                                             
                                                           ------------------  -----------------  ------------------
    Net income                                                        44,039             60,949              82,837 
    Interest expense                                                  19,953             14,871              12,583 
    Taxes                                                             35,978             47,284              62,269 
    Depreciation & Amortization                                       63,500             43,100              33,400 
    Normal profit                                                    (35,647)              (842)               (800)
                                                           ------------------  -----------------  ------------------
    EBITDA                                                           127,823            165,362             190,289 
                                                           ==================  =================  ==================

Appendix C-2

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WASHINGTON GROUP INTERNATIONAL, INC.
2002 - 2004 FINANCIAL PLAN
 CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)

                                                        [Enlarge/Download Table]


------------------  ----------------                                                    ------------- -------------- --------------
      2000               2001                                                             2002           2003           2004       
     ACTUAL              FCST                                                             PLAN           PLAN           PLAN       
      TOTAL              TOTAL                                                            TOTAL          TOTAL          TOTAL      
------------------  ----------------                                                    ------------- -------------- --------------
                                                                                                                                   
                                      NEW WORK                                                                                     
          229,874           379,102       Power                                              654,162        856,025      1,007,803 
        1,678,269           726,682       Infrastructure & Mining                          1,176,415      1,129,435      1,263,419 
          665,001           721,228       Industrial/Process (Incl PetroChem)                862,400      1,016,100      1,189,600 
          273,945           788,639       Government                                         496,234        671,062        691,389 
           (2,948)           (6,522)      Corporate                                                -              -              - 
------------------  ----------------                                                    ------------- -------------- --------------
        2,844,141         2,609,128            Total                                       3,189,211      3,672,622      4,152,211 

                                      ENDING BACKLOG                                                                               
        1,506,805           377,000       Power                                              542,338        795,984      1,003,291 
                -          (909,000)         Power De-Bookings                                     -              -              - 
        1,862,779         1,504,316       Infrastructure & Mining                          1,606,298      1,744,987      1,913,755 
          905,950           561,509       Industrial/Process (Incl PetroChem)                553,709        631,309        806,709 
                -          (100,000)         P/C De-Bookings (Sale & Reorg)                        -              -              - 
        1,362,860           903,934       Government                                         686,987        678,275        703,620 
                -          (247,000)        Government De-Bookings (EMD)                           -              -              - 
                -                 -       Corporate                                                -              -              - 
------------------  ----------------                                                    ------------- -------------- --------------
        5,638,394         3,346,759            Total                                       3,389,332      3,850,555      4,427,375 

                                      REVENUE                                                                                      
          515,740           600,867       Power                                              488,825        602,379        800,496 
          827,495         1,085,102       Infrastructure & Mining                          1,074,433        990,746      1,094,651 
          874,648           965,799       Industrial/Process (Incl PetroChem)                870,200        938,500      1,014,200 
          998,502         1,000,346       Government                                         713,181        679,774        666,044 
           (2,948)           (6,265)      Corporate                                                -              -              - 
------------------  ----------------                                                    ------------- -------------- --------------
        3,213,437         3,645,849            Total                                                                               
                                                                                           3,146,639      3,211,399      3,575,391 
                                      GROSS PROFIT                                                                                 
           16,715            (6,040)      Power                                               10,162         20,291         36,929 
           52,298            75,350       Infrastructure & Mining                             84,706         67,591         77,260 
           24,450             4,757       Industrial/Process (Incl PetroChem)                 32,300         37,400         43,600 
           33,287            63,324       Government                                          52,295         47,816         50,672 
           12,087            (4,028)      Corporate                                           (3,376)        (3,814)        (4,000)
                -                 -       Management Adjustment                              (25,000)             -              - 
------------------  ----------------                                                    ------------- -------------- --------------
          138,837           133,362            Total                                         151,087        169,284        204,461 

                                      OTHER INCOME/(EXPENSE)                                                                       

          (37,859)          (48,201)      General and administrative expenses                (45,000)       (40,000)       (40,000)
          (42,005)          (77,610)      Goodwill amortization                                    -              -              - 
          (14,359)          (48,293)      Merger and reorganization costs                          -              -              - 
           10,567            12,846       Investment income                                    3,812          3,796          3,795 
          (38,795)          (64,328)      Interest expense                                   (19,953)       (14,871)       (12,583)
                -           226,620       Net gain in bankruptcy                                   -              -              - 
            1,269           (11,066)      Other income (expense), net                              -              -              - 
------------------  ----------------                                                    ------------- -------------- --------------

                                      Income before income taxes and minority interests                                            
           17,654           123,331       in income of consolidated subsidiaries              89,946        118,209        155,673 
           (8,012)           (3,621)  Income tax expense                                     (35,978)       (47,284)       (62,269)
                                      Minority interests in income of consolidated                                                 
           (9,152)          (15,508)       subsidiaries                                       (9,929)        (9,976)       (10,567)
------------------  ----------------                                                    ------------- -------------- --------------
              490           104,201    Net income                                             44,039         60,949         82,837 
==================  ================                                                    ============= ============== ==============


Appendix C-3

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WASHINGTON GROUP INTERNATIONAL, INC.
2002 - 2004 FINANCIAL PLAN
 CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

                                                        [Enlarge/Download Table]

---------------------                                                        --------------  ----------  -----------
        2001                                                                      2002          2003        2004    
---------------------                                                        --------------  ----------  -----------
      FORECAST                                                                    PLAN         PLAN         PLAN    
        TOTAL          ASSETS                                                     TOTAL        TOTAL        TOTAL   
        -----                                                                     -----        -----        -----   
                                                                                                                    
                         CURRENT ASSETS                                                                             
               78,683      Cash and cash equivalents                                 75,426     112,304      141,110
              404,856      Accounts receivable including retentions                 360,873     413,561      492,174
              313,489      Unbilled receivables                                     298,037     291,310      341,519
                2,996      Inventories                                                3,146       3,046        2,996
                3,722      Refundable income taxes                                    3,722       3,722        3,722
               46,795      Investments in joint ventures                             36,873      23,146       27,246
                    -      Deferred income taxes                                          -           -            -
               81,283      Other current assets                                      27,004      28,271       28,855
---------------------                                                        --------------  ----------  -----------
              931,824    TOTAL CURRENT ASSETS                                       805,081     875,360    1,037,622
---------------------                                                        --------------  ----------  -----------
                         INVESTMENTS AND OTHER ASSETS                                                               
                    -      Marketable securities                                          -           -            -
                           Equity in subs & affiliates / investments                                                
               76,974         in mining ventures                                     83,809      78,909       67,509
              523,484      Goodwill                                                 523,484     523,484      523,484
                    -      Deferred non-current income taxes                              -           -            -
               18,067      Other non-current assets                                  30,114      24,281       18,447
---------------------                                                        --------------  ----------  -----------
              618,525    TOTAL INVESTMENTS AND OTHER ASSETS                         637,407     626,674      609,440
---------------------                                                        --------------  ----------  -----------

---------------------                                                        --------------  ----------  -----------
              198,358    PROPERTY AND EQUIPMENT, NET                                137,698     127,699      130,767
---------------------                                                        --------------  ----------  -----------

            1,748,707  TOTAL ASSETS                                               1,580,186   1,629,733    1,777,829
=====================                                                        ==============  ==========  ===========

                       LIABILITIES & STOCKHOLDERS' EQUITY                                                           
                         CURRENT LIABILITIES                                                                        
                    -      Current portion of long-term debt                              -           -            -
              261,466      Accounts and subcontracts payable                        262,186     278,745      312,575
              361,532      Billings in excess of cost                               157,332     155,083      163,262
               56,606      Estimated costs to complete                               51,364      46,490       49,065
               99,122      Accrued salaries, wages and benefits                     102,417     101,624      104,649
                  429      Income taxes payable                                       1,595       1,600        1,624
              113,674      Accrued liabilities                                       99,003      96,539       85,622
---------------------                                                        --------------  ----------  -----------
              892,829    TOTAL CURRENT LIABILITIES                                  673,897     680,081      716,797
---------------------                                                        --------------  ----------  -----------
                         NON-CURRENT LIABILITIES                                                                    
                    -     Long-term debt                                                  -           -            -
               50,000      Revolving working capital facility                        45,000           -            -
               55,792     Accrued workers' compensation                              55,787      55,789       55,790
              114,102      Pension, def. comp. & post-ret. benefit obligations      111,952     111,102      111,102
                4,300     Environmental liabilities                                   4,307       4,307        4,307
               35,000     Deferred income taxes                                      59,955      84,336      111,948
               17,679     Other non-current liabilities                              16,369      16,230       16,230
---------------------                                                        --------------  ----------  -----------
              276,873    TOTAL LIABILITIES                                          293,370     271,764      299,377
---------------------                                                        --------------  ----------  -----------
               79,005    MINORITY INTEREST                                           68,881      72,901       73,831
---------------------                                                        --------------  ----------  -----------
              500,000    TOTAL STOCKHOLDER'S EQUITY                                 544,038     604,987      687,824
---------------------                                                        --------------  ----------  -----------
            1,748,707    TOTAL LIABILITIES & EQUITY                               1,580,186   1,629,733    1,777,829
=====================                                                        ==============  ==========  ===========

Appendix C-4

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WASHINGTON GROUP INTERNATIONAL, INC.
 2001 FORECAST
COMBINING BALANCE SHEETS
(IN THOUSANDS)

                                                        [Enlarge/Download Table]

                                                           ----------  ----------  ---------  -----------  ----------  ----------
                                                              2001        2001       2001         2001        2001        2001   
                                                           ----------  ----------  ---------  -----------  ----------  ----------
                                                             Power       Infra     I/P(+P/C)    Gov Serv    Corporate            
ASSETS                                                       Total       Total      Total        Total       Total       Total   
                                                             -----       -----      -----        -----       -----       -----   
                                                                                                                                 
    CURRENT ASSETS                                                                                                               
      Cash and cash equivalents                                 2,623      11,707      8,307       11,291      44,755      78,683
      Accounts receivable including retentions                 45,189     127,539    144,318       86,394       1,416     404,856
      Unbilled receivables                                     20,929      82,391    155,700       54,469           -     313,489
      Inventories                                                   -           -          -        2,650         346       2,996
      Refundable income taxes                                       -           -          -            -       3,722       3,722
      Investments in joint ventures                                 -      44,327          -        1,022       1,446      46,795
      Deferred income taxes                                         -           -          -            -           -           -
      Other current assets                                          -      16,151     22,208        2,828      40,096      81,283
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL CURRENT ASSETS                                       68,741     282,115    330,533      158,654      91,781     931,824
                                                           ----------  ----------  ---------  -----------  ----------  ----------

    INVESTMENTS AND OTHER ASSETS                                                                                                 
      Marketable Securities                                         -           -          -            -           -           -
      Equity in subs & affiliates / investments in                                                                               
        mining ventures                                             -      76,974          -            -           -      76,974
      Goodwill                                                      -         746          -      235,671     287,067     523,484
      Deferred non-current income taxes                             -           -          -            -           -           -
      Other non-current assets                                      -         381          -       12,437       5,249      18,067
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL INVESTMENTS AND OTHER ASSETS                              -      78,101          -      248,108     292,316     618,525
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    PROPERTY AND EQUIPMENT, NET                                 7,389     158,399     14,012        7,248      11,310     198,358
                                                           ----------  ----------  ---------  -----------  ----------  ----------
TOTAL ASSETS                                                   76,130     518,615    344,545      414,010     395,407   1,748,707
                                                           ==========  ==========  =========  ===========  ==========  ==========

LIABILITIES & STOCKHOLDERS' EQUITY                                                                                               
    CURRENT LIABILITIES                                                                                                          
      Current portion of long-term debt                             -           -          -            -           -           -
      Accounts and subcontracts payable                        30,244      59,229    111,752       32,930      27,311     261,466
      Billings in excess of cost                                7,000     170,952    145,134       20,659      17,787     361,532
      Estimated costs to complete                              11,000       4,485     16,300       24,821           -      56,607
      Accrued salaries, wages and benefits                     11,000      12,083     12,725        9,124      54,191      99,122
      Income taxes payable                                          -         429          -            -           -         429
      Accrued liabilities                                       6,900      (2,920)         -        8,061     101,633     113,674
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL CURRENT LIABILITIES                                  66,144     244,258    285,911       95,595     200,922     892,830
                                                           ----------  ----------  ---------  -----------  ----------  ----------

    NON-CURRENT LIABILITIES                                                                                                      
      Revolving working capital facility                            -           -          -            -      50,000      50,000
     Accrued workers' compensation                                  -           -          -        3,667      52,125      55,792
      Pension, def. comp. & post-ret. benefit obligations           -           -          -       89,350      24,752     114,102
     Environmental liabilities                                      -           -          -          325       3,975       4,300
     Deferred income taxes                                          -           -          -            -      35,000      35,000
     Other non-current liabilities                                  -       1,129          -        7,908       8,641      17,678
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL NON-CURRENT LIABILITIES                                   -       1,129          -      101,250     174,493     276,872
                                                           ----------  ----------  ---------  -----------  ----------  ----------
 MINORITY INTEREST                                                  -      14,457          -       64,548           -      79,005
                                                           ----------  ----------  ---------  -----------  ----------  ----------
 TOTAL STOCKHOLDER'S EQUITY                                     9,986     258,771     58,634      152,617      19,992     500,000
                                                           ----------  ----------  ---------  -----------  ----------  ----------
TOTAL LIABILITIES & EQUITY                                     76,130     518,615    344,545      414,010     395,407   1,748,707
                                                           ==========  ==========  =========  ===========  ==========  ==========

                                  Appendix C-5

EX-99.2
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WASHINGTON GROUP INTERNATIONAL, INC.
2002 PLAN   
COMBINING BALANCE SHEETS    
(IN THOUSANDS)    

                                                        [Enlarge/Download Table]

                                                           ----------  ----------  ---------  -----------  ----------  ----------
                                                              2002        2002       2002         2002        2002        2002   
                                                           ----------  ----------  ---------  -----------  ----------  ----------
                                                             Power       Infra     I/P(+P/C)    Gov Serv    Corporate            
ASSETS                                                       Total       Total      Total        Total       Total       Total   
                                                             -----       -----      -----        -----       -----       -----   
                                                                                                                                 
    CURRENT ASSETS                                                                                                               

      Cash and cash equivalents                                 2,623       5,803     (2,400)       8,230      61,170      75,426
      Accounts receivable including retentions                 56,947      89,808    147,200       65,502       1,416     360,873
      Unbilled receivables                                     28,821      53,204    161,700       54,312           -     298,037
      Inventories                                                   -           -          -        2,800         346       3,146
      Refundable income taxes                                       -           -          -            -       3,722       3,722
      Investments in joint ventures                                 -      34,277          -        1,150       1,446      36,873
      Deferred income taxes                                         -           -          -            -           -           -
      Other current assets                                          -      10,349     10,100        2,411       4,144      27,004
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL CURRENT ASSETS                                       88,391     193,441    316,600      134,405      72,244     805,081
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    INVESTMENTS AND OTHER ASSETS                                                                                                 
      Marketable Securities                                         -           -          -            -           -           -
      Equity in subs & affiliates / investments in                                                                               
        mining ventures                                             -      83,809          -            -           -      83,809
      Goodwill                                                      -         476          -      222,003     301,005     523,484
      Deferred non-current income taxes                             -           -          -            -           -           -
      Other non-current assets                                      -         381          -       12,817      16,916      30,114
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL INVESTMENTS AND OTHER ASSETS                              -      84,666          -      234,820     317,921     637,407
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    PROPERTY AND EQUIPMENT, NET                                 6,279      97,761     15,400        6,324      11,934     137,698
                                                           ----------  ----------  ---------  -----------  ----------  ----------
TOTAL ASSETS                                                   94,670     375,868    332,000      375,549     402,099   1,580,186
                                                           ==========  ==========  =========  ===========  ==========  ==========
LIABILITIES & STOCKHOLDERS' EQUITY                                                                                               
    CURRENT LIABILITIES                                                                                                          
      Current portion of long-term debt                             -           -          -            -           -           -
      Accounts and subcontracts payable                        47,082      54,907    104,500       28,386      27,311     262,186
      Billings in excess of cost                                8,500      26,881     93,300       10,864      17,787     157,332
      Estimated costs to complete                              10,000       1,933     16,300       23,131           -      51,364
      Accrued salaries, wages and benefits                     12,500      11,843     12,700       11,183      54,191     102,417
      Income taxes payable                                          -       1,595          -            -           -       1,595
      Accrued liabilities                                       5,400      (3,518)         -        4,655      92,466      99,003
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL CURRENT LIABILITIES                                  83,482      93,641    226,800       78,219     191,755     673,897
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    NON-CURRENT LIABILITIES                                                                                                      
      Revolving working capital facility                            -           -          -            -      45,000      45,000
     Accrued workers' compensation                                  -           -          -        2,222      53,565      55,787
      Pension, def. comp. & post-ret. benefit obligations           -           -          -       87,200      24,752     111,952
     Environmental liabilities                                      -           -          -          332       3,975       4,307
     Deferred income taxes                                          -           -          -            -      59,955      59,955
     Other non-current liabilities                                  -         163          -        7,565       8,641      16,369
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL NON-CURRENT LIABILITIES                                   -         163          -       97,319     195,888     293,370
                                                           ----------  ----------  ---------  -----------  ----------  ----------
 MINORITY INTEREST                                                  -      11,171          -       57,710           -      68,881
                                                           ----------  ----------  ---------  -----------  ----------  ----------
 TOTAL STOCKHOLDER'S EQUITY                                    11,188     270,893    105,200      142,301      14,456     544,038
                                                           ----------  ----------  ---------  -----------  ----------  ----------
TOTAL LIABILITIES & EQUITY                                     94,670     375,868    332,000      375,549     402,099   1,580,186
                                                           ==========  ==========  =========  ===========  ==========  ==========

                                  Appendix C-6

EX-99.2
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WASHINGTON GROUP INTERNATIONAL, INC.
2003 PLAN 
COMBINING BALANCE SHEETS  
(IN THOUSANDS)

                                                        [Enlarge/Download Table]

                                                           ----------  ----------  ---------  -----------  ----------  ----------
                                                              2003        2003       2003         2003        2003        2003   
                                                           ----------  ----------  ---------  -----------  ----------  ----------
                                                             Power       Infra     I/P(+P/C)    Gov Serv    Corporate            
ASSETS                                                       Total       Total      Total        Total       Total       Total   
                                                             -----       -----      -----        -----       -----       -----   
                                                                                                                                 
    CURRENT ASSETS                                                                                                               
      Cash and cash equivalents                                 2,623      (1,609)    36,200        8,378      66,712     112,304
      Accounts receivable including retentions                 66,322      88,385    153,800       63,638      41,416     413,561
      Unbilled receivables                                     35,481      51,415    167,800       36,614           -     291,310
      Inventories                                                   -           -          -        2,700         346       3,046
      Refundable income taxes                                       -           -          -            -       3,722       3,722
      Investments in joint ventures                                 -      19,200          -        2,500       1,446      23,146
      Deferred income taxes                                         -           -          -            -           -           -
      Other current assets                                          -      11,282     10,100        2,745       4,144      28,271
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL CURRENT ASSETS                                      104,426     168,673    367,900      116,575     117,786     875,360
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    INVESTMENTS AND OTHER ASSETS                                                                                                 
      Marketable Securities                                         -           -          -            -           -           -
      Equity in subs & affiliates / investments in                                                                               
        mining ventures                                             -      78,909          -            -           -      78,909
      Goodwill                                                      -         207          -      208,335     314,942     523,484
      Deferred non-current income taxes                             -           -          -            -           -           -
      Other non-current assets                                      -         381          -       12,817      11,083      24,281
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL INVESTMENTS AND OTHER ASSETS                              -      79,497          -      221,152     326,025     626,674
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    PROPERTY AND EQUIPMENT, NET                                 5,278      89,002     15,400        5,899      12,120     127,699
                                                           ----------  ----------  ---------  -----------  ----------  ----------
TOTAL ASSETS                                                  109,704     337,172    383,300      343,626     455,931   1,629,733
                                                           ==========  ==========  =========  ===========  ==========  ==========
LIABILITIES & STOCKHOLDERS' EQUITY                                                                                               
    CURRENT LIABILITIES                                                                                                          
      Current portion of long-term debt                             -           -          -            -           -           -
      Accounts and subcontracts payable                        57,578      50,204    114,300       29,352      27,311     278,745
      Billings in excess of cost                                9,000      22,473     97,300        8,523      17,787     155,083
      Estimated costs to complete                              10,000       1,948     16,300       18,242           -      46,490
      Accrued salaries, wages and benefits                     13,500       8,916     12,700       12,317      54,191     101,624
      Income taxes payable                                          -       1,600          -            -           -       1,600
      Accrued liabilities                                       4,400       3,397          -        6,276      82,466      96,539
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL CURRENT LIABILITIES                                  94,478      88,538    240,600       74,710     181,755     680,081
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    NON-CURRENT LIABILITIES                                                                                                      
      Revolving working capital facility                            -           -          -            -           -           -
      Accrued workers' compensation                                 -           -          -          784      55,005      55,789
      Pension, def. comp. & post-ret. benefit obligations           -           -          -       86,350      24,752     111,102
     Environmental liabilities                                      -           -          -          332       3,975       4,307
     Deferred income taxes                                          -           -          -            -      84,336      84,336
     Other non-current liabilities                                  -         113          -        7,476       8,641      16,230
                                                           ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL NON-CURRENT LIABILITIES                                   -         113          -       94,942     176,709     271,764
                                                           ----------  ----------  ---------  -----------  ----------  ----------
 MINORITY INTEREST                                                  -      16,831          -       56,070           -      72,901
                                                           ----------  ----------  ---------  -----------  ----------  ----------
 TOTAL STOCKHOLDER'S EQUITY                                    15,226     231,690    142,700      117,904      97,467     604,987
                                                           ----------  ----------  ---------  -----------  ----------  ----------
TOTAL LIABILITIES & EQUITY                                    109,704     337,172    383,300      343,626     455,931   1,629,733
                                                           ==========  ==========  =========  ===========  ==========  ==========


                                  Appendix C-7

EX-99.2
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WASHINGTON GROUP INTERNATIONAL, INC.
2004 PLAN 
COMBINING BALANCE SHEETS  
(IN THOUSANDS)  

                                                        [Enlarge/Download Table]

                                                          ----------  ----------  ---------  -----------  ----------  ----------
                                                             2004        2004       2004         2004        2004        2004   
                                                          ----------  ----------  ---------  -----------  ----------  ----------
                                                            Power       Infra     I/P(+P/C)    Gov Serv    Corporate            
ASSETS                                                      Total       Total      Total        Total       Total       Total   
                                                            -----       -----      -----        -----       -----       -----   
                                                                                                                                
    CURRENT ASSETS                                                                                                              
      Cash and cash equivalents                                2,623      (1,569)    81,100        8,433      50,523     141,110
      Accounts receivable including retentions                83,527      97,282    159,600       70,349      81,416     492,174
      Unbilled receivables                                    47,150      73,937    174,000       46,432           -     341,519
      Inventories                                                  -           -          -        2,650         346       2,996
      Refundable income taxes                                      -           -          -            -       3,722       3,722
      Investments in joint ventures                                -      21,800          -        4,000       1,446      27,246
      Deferred income taxes                                        -           -          -            -           -           -
      Other current assets                                         -      11,842     10,100        2,769       4,144      28,855
                                                          ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL CURRENT ASSETS                                     133,300     203,292    424,800      134,633     141,597   1,037,622
                                                          ----------  ----------  ---------  -----------  ----------  ----------
    INVESTMENTS AND OTHER ASSETS                                                                                                
      Marketable Securities                                        -           -          -            -           -           -
      Equity in subs & affiliates / investments in                                                                              
        mining ventures                                            -      67,509          -            -           -      67,509
      Goodwill                                                     -           -          -      194,667     328,817     523,484
      Deferred non-current income taxes                            -           -          -            -           -           -
      Other non-current assets                                     -         381          -       12,817       5,249      18,447
                                                          ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL INVESTMENTS AND OTHER ASSETS                             -      67,890          -      207,484     334,066     609,440
                                                          ----------  ----------  ---------  -----------  ----------  ----------
    PROPERTY AND EQUIPMENT, NET                                4,278      93,317     15,400        5,652      12,120     130,767
                                                          ----------  ----------  ---------  -----------  ----------  ----------
TOTAL ASSETS                                                 137,578     364,499    440,200      347,769     487,783   1,777,829
                                                          ==========  ==========  =========  ===========  ==========  ==========
LIABILITIES & STOCKHOLDERS' EQUITY                                                                                              
      Current portion of long-term debt                            -           -          -            -           -           -
      Accounts and subcontracts payable                       76,344      55,845    121,300       31,775      27,311     312,575
      Billings in excess of cost                               9,500      21,498    103,600       10,877      17,787     163,262
      Estimated costs to complete                             10,000       1,957     16,300       20,808           -      49,065
      Accrued salaries, wages and benefits                    14,500      10,125     12,700       13,133      54,191     104,649
      Income taxes payable                                         -       1,624          -            -           -       1,624
      Accrued liabilities                                      3,400       3,727          -        6,029      72,466      85,622
                                                          ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL CURRENT LIABILITIES                                113,744      94,776    253,900       82,622     171,755     716,797
                                                          ----------  ----------  ---------  -----------  ----------  ----------
    NON-CURRENT LIABILITIES                                                                                                     
      Revolving working capital facility                           -           -          -            -           -           -
     Accrued workers' compensation                                 -           -          -           13      55,777      55,790
     Pension, def. comp. & post-ret. benefit obligations           -           -          -       86,350      24,752     111,102
     Environmental liabilities                                     -           -          -          332       3,975       4,307
     Deferred income taxes                                         -           -          -            -     111,948     111,948
     Other non-current liabilities                                 -         113          -        7,476       8,641      16,230
                                                          ----------  ----------  ---------  -----------  ----------  ----------
    TOTAL NON-CURRENT LIABILITIES                                  -         113          -       94,171     205,093     299,377
                                                          ----------  ----------  ---------  -----------  ----------  ----------
 MINORITY INTEREST                                                 -      22,893          -       50,938           -      73,831
                                                          ----------  ----------  ---------  -----------  ----------  ----------
 TOTAL STOCKHOLDER'S EQUITY                                   23,834     246,717    186,300     120,038      110,935     687,824
                                                          ----------  ----------  ---------  -----------  ----------  ----------
TOTAL LIABILITIES & EQUITY                                   137,578     364,499    440,200     347,769      487,783   1,777,829
                                                          ==========  ==========  =========  ===========  ==========  ==========


                                  Appendix C-8

EX-99.2
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WASHINGTON GROUP INTERNATIONAL, INC.
 BUSINESS PLAN
POWER BALANCE SHEETS
(IN THOUSANDS)  

                                                        [Enlarge/Download Table]

                                                          ---------  ---------  ---------   ---------
                                                             2001       2002       2003        2004  
                                                          ---------  ---------  ---------   ---------
ASSETS                                                      Total      Total      Total       Total  
                                                            -----      -----      -----       -----  
                                                                                                     
    CURRENT ASSETS                                                                                   
      Cash and cash equivalents                               2,623      2,623      2,623      2,623 
      Accounts receivable including retentions               45,189     56,947     66,322     83,527 
      Unbilled receivables                                   20,929     28,821     35,481     47,150 
      Inventories                                                 -          -          -          - 
      Refundable income taxes                                     -          -          -          - 
      Investments in joint ventures                               -          -          -          - 
      Deferred income taxes                                       -          -          -          - 
      Other current assets                                        -          -          -          - 
                                                          ---------  ---------  ---------  --------- 
    TOTAL CURRENT ASSETS                                     68,741     88,391    104,426    133,300 
                                                          ---------  ---------  ---------  --------- 
    INVESTMENTS AND OTHER ASSETS                                                                     
      Marketable Securities                                       -          -          -          - 
      Equity in subs & affiliates / investments in                                                   
        mining ventures                                           -          -          -          - 
      Goodwill                                                    -          -          -          - 
      Deferred non-current income taxes                           -          -          -          - 
      Other non-current assets                                    -          -          -          - 
                                                          ---------  ---------  ---------  --------- 
    TOTAL INVESTMENTS AND OTHER ASSETS                            -          -          -          - 
                                                          ---------  ---------  ---------  --------- 
    PROPERTY AND EQUIPMENT, NET                               7,389      6,279      5,278      4,278 
                                                          ---------  ---------  ---------  --------- 
TOTAL ASSETS                                                 76,130     94,670    109,704    137,578 
                                                          =========  =========  =========  ========= 
LIABILITIES & STOCKHOLDERS' EQUITY                                                                   
    CURRENT LIABILITIES                                                                              
      Current portion of long-term debt                           -          -          -          - 
      Accounts and subcontracts payable                      30,244     47,082     57,578     76,344 
      Billings in excess of cost                              7,000      8,500      9,000      9,500 
      Estimated costs to complete                            11,000     10,000     10,000     10,000 
      Accrued salaries, wages and benefits                   11,000     12,500     13,500     14,500 
      Income taxes payable                                        -          -          -          - 
      Accrued liabilities                                     6,900      5,400      4,400      3,400 
                                                          ---------  ---------  ---------  --------- 
    TOTAL CURRENT LIABILITIES                                66,144     83,482     94,478    113,744 
                                                          ---------  ---------  ---------  --------- 
    NON-CURRENT LIABILITIES                                                                          
     Revolving working capital facility                           -          -          -          - 
     Accrued workers' compensation                                -          -          -          - 
     Pension, def. comp. & post-ret. benefit obligations          -          -          -          - 
     Environmental liabilities                                    -          -          -          - 
     Deferred income taxes                                        -          -          -          - 
     Other non-current liabilities                                -          -          -          - 
                                                          ---------  ---------  ---------  --------- 
    TOTAL NON-CURRENT LIABILITIES                                 -          -          -          - 
 MINORITY INTEREST                                                -          -          -          - 
 TOTAL STOCKHOLDER'S EQUITY                                   9,986     11,188     15,226     23,834 
                                                          ---------  ---------  ---------  --------- 
TOTAL LIABILITIES & EQUITY                                   76,130     94,670    109,704    137,578 
                                                          =========  =========  =========  ========= 

                                  Appendix C-9

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WASHINGTON GROUP INTERNATIONAL, INC.                  
BUSINESS PLAN                   
INFRASTRUCTURE & MINING BALANCE SHEETS                  
(IN THOUSANDS)                  

                                                        [Enlarge/Download Table]

                                                          ---------  ---------  ---------   ---------
                                                             2001       2002       2003        2004  
                                                          ---------  ---------  ---------   ---------
ASSETS                                                      Total      Total      Total       Total  
                                                            -----      -----      -----       -----  
                                                                                                     
    CURRENT ASSETS                                                                                   
      Cash and cash equivalents                              11,707      5,803     (1,609)    (1,569)
      Accounts receivable including retentions              127,539     89,808     88,385     97,282 
      Unbilled receivables                                   82,391     53,204     51,415     73,937 
      Inventories                                                 -          -          -          - 
      Refundable income taxes                                     -          -          -          - 
      Investments in joint ventures                          44,327     34,277     19,200     21,800 
      Deferred income taxes                                       -          -          -          - 
      Other current assets                                   16,151     10,349     11,282     11,842 
                                                          ---------  ---------  ---------  --------- 
    TOTAL CURRENT ASSETS                                    282,115    193,441    168,673    203,292 
                                                          ---------  ---------  ---------  --------- 
    INVESTMENTS AND OTHER ASSETS                                                                     
      Marketable Securities                                       -          -          -          - 
      Equity in subs & affiliates / investments in                                                   
        mining ventures                                      76,974     83,809     78,909     67,509 
      Goodwill                                                  746        476        207          - 
      Deferred non-current income taxes                           -          -          -          - 
      Other non-current assets                                  381        381        381        381 
                                                          ---------  ---------  ---------  --------- 
    TOTAL INVESTMENTS AND OTHER ASSETS                       78,101     84,666     79,497     67,890 
                                                          ---------  ---------  ---------  --------- 
    PROPERTY AND EQUIPMENT, NET                             158,399     97,761     89,002     93,317 
                                                          ---------  ---------  ---------  --------- 
TOTAL ASSETS                                                518,615    375,868    337,172    364,499 
                                                          =========  =========  =========  ========= 
LIABILITIES & STOCKHOLDERS' EQUITY                                                                   
    CURRENT LIABILITIES                                                                              
      Current portion of long-term debt                           -          -          -          - 
      Accounts and subcontracts payable                      59,229     54,907     50,204     55,845 
      Billings in excess of cost                            170,952     26,881     22,473     21,498 
      Estimated costs to complete                             4,485      1,933      1,948      1,957 
      Accrued salaries, wages and benefits                   12,083     11,843      8,916     10,125 
      Income taxes payable                                      429      1,595      1,600      1,624 
      Accrued liabilities                                    (2,920)    (3,518)     3,397      3,727 
                                                          ---------  ---------  ---------  --------- 
    TOTAL CURRENT LIABILITIES                               244,258     93,641     88,538     94,776 
                                                          ---------  ---------  ---------  --------- 
    NON-CURRENT LIABILITIES                                                                          
      Revolving working capital facility                          -          -          -          - 
     Accrued workers' compensation                                -          -          -          - 
     Pension, def. comp. & post-ret. benefit obligations          -          -          -          - 
     Environmental liabilities                                    -          -          -          - 
     Deferred income taxes                                        -          -          -          - 
     Other non-current liabilities                            1,129        163        113        113 
                                                          ---------  ---------  ---------  --------- 
    TOTAL NON-CURRENT LIABILITIES                             1,129        163        113        113 
 MINORITY INTEREST                                           14,457     11,171     16,831     22,893 
 TOTAL STOCKHOLDER'S EQUITY                                 258,771    270,893    231,690    246,717 
                                                          ---------  ---------  ---------  --------- 
TOTAL LIABILITIES & EQUITY                                  518,615    375,868    337,172    364,499 
                                                          =========  =========  =========  ========= 


                                   Appendix C-10

EX-99.2
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WASHINGTON GROUP INTERNATIONAL, INC.                  
BUSINESS PLAN                   
INDUSTRIAL PROCESS BALANCE SHEETS                   
(IN THOUSANDS)                  

                                                        [Enlarge/Download Table]

                                                           ---------  ---------  ---------  ---------
                                                              2001       2002       2003       2004  
                                                           ---------  ---------  ---------  ---------
ASSETS                                                       Total      Total      Total      Total  
                                                             -----      -----      -----      -----  
                                                                                                     
    CURRENT ASSETS                                                                                   
      Cash and cash equivalents                                8,307     (2,400)    36,200     81,100
      Accounts receivable including retentions               144,318    147,200    153,800    159,600
      Unbilled receivables                                   155,700    161,700    167,800    174,000
      Inventories                                                  -          -          -          -
      Refundable income taxes                                      -          -          -          -
      Investments in joint ventures                                -          -          -          -
      Deferred income taxes                                        -          -          -          -
      Other current assets                                    22,208     10,100     10,100     10,100
                                                           ---------  ---------  ---------  ---------

    TOTAL CURRENT ASSETS                                     330,533    316,600    367,900    424,800
                                                           ---------  ---------  ---------  ---------
    INVESTMENTS AND OTHER ASSETS                                                                     
      Marketable Securities                                        -          -          -          -
      Equity in subs & affiliates / investments in                                                   
        mining ventures                                            -          -          -          -
      Goodwill                                                     -          -          -          -
      Deferred non-current income taxes                            -          -          -          -
      Other non-current assets                                     -          -          -          -
                                                           ---------  ---------  ---------  ---------
    TOTAL INVESTMENTS AND OTHER ASSETS                             -          -          -          -
                                                           ---------  ---------  ---------  ---------
    PROPERTY AND EQUIPMENT, NET                               14,012     15,400     15,400     15,400
                                                           ---------  ---------  ---------  ---------

TOTAL ASSETS                                                 344,545    332,000    383,300    440,200
                                                           =========  =========  =========  =========

LIABILITIES & STOCKHOLDERS' EQUITY                                                                   
    CURRENT LIABILITIES                                                                              
      Current portion of long-term debt                            -          -          -          -
      Accounts and subcontracts payable                      111,752    104,500    114,300    121,300
      Billings in excess of cost                             145,134     93,300     97,300    103,600
      Estimated costs to complete                             16,300     16,300     16,300     16,300
      Accrued salaries, wages and benefits                    12,725     12,700     12,700     12,700
      Income taxes payable                                         -          -          -          -
      Accrued liabilities                                          -          -          -          -
                                                           ---------  ---------  ---------  ---------
    TOTAL CURRENT LIABILITIES                                285,911    226,800    240,600    253,900
                                                           ---------  ---------  ---------  ---------
    NON-CURRENT LIABILITIES                                                                          
      Revolving working capital facility                           -          -          -          -
     Accrued workers' compensation                                 -          -          -          -
      Pension, def. comp. & post-ret. benefit obligations          -          -          -          -
     Environmental liabilities                                     -          -          -          -
     Deferred income taxes                                         -          -          -          -
     Other non-current liabilities                                 -          -          -          -
                                                           ---------  ---------  ---------  ---------

    TOTAL NON-CURRENT LIABILITIES                                  -          -          -          -

 MINORITY INTEREST                                                 -          -          -          -
 TOTAL STOCKHOLDER'S EQUITY                                   58,634    105,200    142,700    186,300
                                                           ---------  ---------  ---------  ---------

TOTAL LIABILITIES & EQUITY                                   344,545    332,000    383,300    440,200
                                                           =========  =========  =========  =========

Appendix C-11 

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WASHINGTON GROUP INTERNATIONAL, INC.                  
BUSINESS PLAN                   
GOVERNMENT BALANCE SHEETS                   
(IN THOUSANDS)                  

                                                        [Enlarge/Download Table]

                                                           ---------  ---------  ---------  ---------
                                                              2001       2002       2003       2004  
                                                           ---------  ---------  ---------  ---------
ASSETS                                                       Total      Total      Total      Total  
                                                             -----      -----      -----      -----  
                                                                                                     
    CURRENT ASSETS                                                                                   
      Cash and cash equivalents                               11,291      8,230      8,378      8,433
      Accounts receivable including retentions                86,394     65,502     63,638     70,349
      Unbilled receivables                                    54,469     54,312     36,614     46,432
      Inventories                                              2,650      2,800      2,700      2,650
      Refundable income taxes                                      -          -          -          -
      Investments in joint ventures                            1,022      1,150      2,500      4,000
      Deferred income taxes                                        -          -          -          -
      Other current assets                                     2,828      2,411      2,745      2,769
                                                           ---------  ---------  ---------  ---------
    TOTAL CURRENT ASSETS                                     158,654    134,405    116,575    134,633
                                                           ---------  ---------  ---------  ---------
    INVESTMENTS AND OTHER ASSETS                                                                     
      Marketable Securities                                        -          -          -          -
      Equity in subs & affiliates / investments in                                                   
        mining ventures                                            -          -          -          -
      Goodwill                                               235,671    222,003    208,335    194,667
      Deferred non-current income taxes                            -          -          -          -
      Other non-current assets                                12,437     12,817     12,817     12,817
                                                           ---------  ---------  ---------  ---------
    TOTAL INVESTMENTS AND OTHER ASSETS                       248,108    234,820    221,152    207,484
                                                           ---------  ---------  ---------  ---------
    PROPERTY AND EQUIPMENT, NET                                7,248      6,324      5,899      5,652
                                                           ---------  ---------  ---------  ---------

TOTAL ASSETS                                                 414,010    375,549    343,626    347,769
                                                           =========  =========  =========  =========

LIABILITIES & STOCKHOLDERS' EQUITY                                                                   
    CURRENT LIABILITIES                                                                              
      Current portion of long-term debt                            -          -          -          -
      Accounts and subcontracts payable                       32,930     28,386     29,352     31,775
      Billings in excess of cost                              20,659     10,864      8,523     10,877
      Estimated costs to complete                             24,821     23,131     18,242     20,808
      Accrued salaries, wages and benefits                     9,124     11,183     12,317     13,133
      Income taxes payable                                         -          -          -          -
      Accrued liabilities                                      8,061      4,655      6,276      6,029
                                                           ---------  ---------  ---------  ---------
    TOTAL CURRENT LIABILITIES                                 95,595     78,219     74,710     82,622
                                                           ---------  ---------  ---------  ---------
    NON-CURRENT LIABILITIES                                                                          
      Revolving working capital facility                           -          -          -          -
     Accrued workers' compensation                             3,667      2,222        784         13
      Pension, def. comp. & post-ret. benefit obligations     89,350     87,200     86,350     86,350
     Environmental liabilities                                   325        332        332        332
     Deferred income taxes                                         -          -          -          -
     Other non-current liabilities                             7,908      7,565      7,476      7,476
                                                           ---------  ---------  ---------  ---------

    TOTAL NON-CURRENT LIABILITIES                            101,250     97,319     94,942     94,171

 MINORITY INTEREST                                            64,548     57,710     56,070     50,938
 TOTAL STOCKHOLDER'S EQUITY                                  152,617    142,301    117,904    120,038
                                                           ---------  ---------  ---------  ---------

TOTAL LIABILITIES & EQUITY                                   414,010    375,549    343,626    347,769
                                                           =========  =========  =========  =========

Appendix C-12 

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WASHINGTON GROUP INTERNATIONAL, INC.                  
BUSINESS PLAN                   
CORPORATE BALANCE SHEETS                  
(IN THOUSANDS)                  

                                                        [Enlarge/Download Table]

                                                           ---------  ---------  ---------  ---------   
                                                              2001       2002       2003       2004     
                                                           ---------  ---------  ---------  ---------   
ASSETS                                                       Total      Total      Total      Total     
                                                             -----      -----      -----      -----     
                                                                                                        
    CURRENT ASSETS                                                                                      
      Cash and cash equivalents                               44,755     61,170     66,712     50,523   
      Accounts receivable including retentions                 1,416      1,416     41,416     81,416   
      Unbilled receivables                                         -          -          -          -   
      Inventories                                                346        346        346        346   
      Refundable income taxes                                  3,722      3,722      3,722      3,722   
      Investments in joint ventures                            1,446      1,446      1,446      1,446   
      Deferred income taxes                                        -          -          -          -   
      Other current assets                                    40,096      4,144      4,144      4,144   
                                                           ---------  ---------  ---------  ---------   
                                                              91,781     72,244    117,786    141,597   
                                                           ---------  ---------  ---------  ---------   
    INVESTMENTS AND OTHER ASSETS                                                                        
      Marketable Securities                                        -          -          -          -   
      Equity in subs & affiliates / investments in                                                      
        mining ventures                                            -          -          -          -   
      Goodwill                                               287,067    301,005    314,942    328,817   
      Deferred non-current income taxes                            -          -          -          -   
      Other non-current assets                                 5,249     16,916     11,083      5,249   
                                                           ---------  ---------  ---------  ---------   
    TOTAL INVESTMENTS AND OTHER ASSETS                       292,316    317,921    326,025    334,066   
                                                           ---------  ---------  ---------  ---------   
    PROPERTY AND EQUIPMENT, NET                               11,310     11,934     12,120     12,120   
                                                           ---------  ---------  ---------  ---------   

TOTAL ASSETS                                                 395,407    402,099    455,931    487,783   
                                                           =========  =========  =========  =========   
LIABILITIES & STOCKHOLDERS' EQUITY                                                                      
    CURRENT LIABILITIES                                                                                 
      Current portion of long-term debt                            -          -          -          -   
      Accounts and subcontracts payable                       27,311     27,311     27,311     27,311   
      Billings in excess of cost                              17,787     17,787     17,787     17,787   
      Estimated costs to complete                                  -          -          -          -   
      Accrued salaries, wages and benefits                    54,191     54,191     54,191     54,191   
      Income taxes payable                                         -          -          -          -   
      Accrued liabilities                                    101,633     92,466     82,466     72,466   
                                                           ---------  ---------  ---------  ---------   
    TOTAL CURRENT LIABILITIES                                200,922    191,755    181,755    171,755   
                                                           ---------  ---------  ---------  ---------   
    NON-CURRENT LIABILITIES                                                                             
      Revolving working capital facility                      50,000     45,000          -          -   
     Accrued workers' compensation                            52,125     53,565     55,005     55,777   
      Pension, def. comp. & post-ret. benefit obligations     24,752     24,752     24,752     24,752   
     Environmental liabilities                                 3,975      3,975      3,975      3,975   
     Deferred income taxes                                    35,000     59,955     84,336    111,948   
     Other non-current liabilities                             8,641      8,641      8,641      8,641   
                                                           ---------  ---------  ---------  ---------   

    TOTAL NON-CURRENT LIABILITIES                            174,493    195,888    176,709    205,093   

 MINORITY INTEREST                                                 -          -          -             -
 TOTAL STOCKHOLDER'S EQUITY                                   19,992     14,456     97,467    110,935   
                                                           ---------  ---------  ---------  ---------   

TOTAL LIABILITIES & EQUITY                                   395,407    402,099    455,931    487,783   
                                                           =========  =========  =========  =========   

Appendix C-13 

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WASHINGTON GROUP INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOW
(IN MILLIONS OF DOLLARS)

                                                        [Enlarge/Download Table]

                                                  ------------   ------------   ------------ 
                                                      2002           2003           2004     
                                                  ------------   ------------   ------------ 
                                                                                             
Operating activities                                                                         
    Net Income                                            44.0           60.9           82.8 
    Depreciation                                          63.5           43.1           33.4 
    Goodwill amortization                                    -              -              - 
    Change in working capital components                 (95.4)         (27.2)         (96.7)
    Other                                                 (7.5)          38.2           45.7 
                                                  ------------   ------------   ------------ 
Cash provided by operations                                4.6          115.1           65.2 
                                                  ------------   ------------   ------------ 
Investing activities                                                                         
    Property and equipment additions                     (43.2)         (38.2)         (36.4)
    Property and equipment disposals                      40.3            5.1              - 
                                                  ------------   ------------   ------------ 
Cash provided by investing activities                     (2.9)         (33.1)         (36.4)
                                                  ------------   ------------   ------------ 
Financing activities                                                                         
    Net borrowing/(repayment) on credit facility          (5.0)         (45.0)             - 
                                                  ------------   ------------   ------------ 
Cash provided by financing activities                     (5.0)         (45.0)             - 
                                                  ------------   ------------   ------------ 

Increase (decrease) in cash                               (3.3)          37.0           28.8 

Beginning cash balance                                    78.7           75.4          112.3 
                                                  ------------   ------------   ------------ 
Ending cash balance                                       75.4          112.3          141.1 
                                                  ============   ============   ============ 

Note: Net income of Groups includes the effect of cash transfers to and from    
Corporate                                                                       

Appendix C-14 

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WASHINGTON GROUP INTERNATIONAL, INC.
 2002 PLAN
 COMBINING STATEMENTS OF CASH FLOW
(IN MILLIONS OF DOLLARS)

                                                        [Enlarge/Download Table]

                                                    ----------  ----------  ---------  -----------  ----------  ---------- 
                                                       2002        2002       2002        2002         2002        2002    
                                                    ----------  ----------  ---------  -----------  ----------  ---------- 
                                                      Power       Infra     I/P(+P/C)    Gov Serv    Corporate             
                                                      Total       Total      Total        Total       Total       Total    
                                                      -----       -----      -----        -----       -----       -----    
                                                                                                                           
Operating activities                                                                                                       
      Net Income                                          10.1        84.7       32.3         52.3      (135.4)       44.0 
      Depreciation                                         1.1        53.1        4.5          1.8         3.0        63.5 
      Goodwill amortization                                  -         0.3          -         13.7       (13.9)          - 
      Recognition of normalized profit                       -       (29.2)      (3.0)        (3.5)                  (35.7)
      Change in working capital components                (2.3)      (38.6)     (52.9)         7.3        26.8       (59.7)
      Other                                                  -       (11.0)         -        (11.2)       14.7        (7.5)
                                                    ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by operations                                8.9        59.2      (19.1)        60.4      (104.8)        4.6 
                                                    ----------  ----------  ---------  -----------  ----------  ---------- 

Investing activities                                                                                                       
      Property and equipment additions                       -       (32.8)      (5.9)        (0.9)       (3.6)      (43.2)
      Property and equipment disposals                       -        40.3          -            -           -        40.3 
                                                    ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by investing activities                        -         7.5       (5.9)        (0.9)       (3.6)       (2.9)
                                                    ----------  ----------  ---------  -----------  ----------  ---------- 

Financing activities                                                                                                       
      Net borrowing/(repayment) on credit facility           -           -          -            -        (5.0)       (5.0)
      Net inter Group/Corporate cash transfers            (8.9)      (72.6)      14.3        (62.6)      129.8           - 
                                                    ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by financing activities                     (8.9)      (72.6)      14.3        (62.6)      124.8        (5.0)
                                                    ----------  ----------  ---------  -----------  ----------  ---------- 

Increase (decrease) in cash                               (0.0)       (5.9)     (10.7)        (3.1)       16.4        (3.3)

Beginning cash balance                                     2.6        11.7        8.3         11.3        44.8        78.7 
                                                    ----------  ----------  ---------  -----------  ----------  ---------- 
Ending cash balance                                        2.6         5.8       (2.4)         8.2        61.1        75.4 
                                                    ==========  ==========  =========  ===========  ==========  ========== 

(1)  Group "net income" is gross profit as presented in the statements of       
operations.                                                           

(2)  Corporate net income includes all components of net income other than Group
gross profit (ie: Corporate G&A, other income and expense, interest   
expense, income taxes and minority interest).                         

(3)  "Net inter group/corporate cash transfers" are reflected as "financing     
activities."                                                          

Appendix C-15 

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WASHINGTON GROUP INTERNATIONAL, INC.                
2003 PLAN                 
COMBINING STATEMENTS OF CASH FLOW                 
(IN MILLIONS OF DOLLARS)                  

                                                        [Enlarge/Download Table]

                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
                                                        2003        2003       2003        2003         2003        2003    
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
                                                       Power       Infra     I/P(+P/C)    Gov Serv    Corporate             
                                                       Total       Total      Total        Total       Total       Total    
                                                       -----       -----      -----        -----       -----       -----    
                                                                                                                            
Operating activities                                                                                                        
       Net Income                                          20.3        67.6       37.4         47.8      (112.2)       60.9 
       Depreciation                                         1.0        33.6        4.0          1.5         3.0        43.1 
       Goodwill amortization                                  -         0.3          -         13.7       (13.9)          - 
       Recognition of normalized profit                       -         0.8          -            -           -         0.8 
       Change in working capital components                (5.0)       11.5        1.1         14.5       (50.0)      (28.0)
       Other                                                  -        10.5                    (4.0)       31.7        38.2 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by operations                                16.3       124.2       42.5         73.5      (141.4)      115.1 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 

Investing activities                                                                                                        
       Property and equipment additions                       -       (29.9)      (4.0)        (1.1)       (3.2)      (38.2)
       Property and equipment disposals                       -         5.1          -            -           -         5.1 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by investing activities                                                                                       
                                                              -       (24.8)      (4.0)        (1.1)       (3.2)      (33.1)
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 

Financing activities                                                                                                        
       Net borrowing/(repayment) on credit facility           -           -          -            -       (45.0)      (45.0)
       Net inter Group/Corporate cash transfers           (16.3)     (106.9)       0.1        (72.1)      195.2           - 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by financing activities                     (16.3)     (106.9)       0.1        (72.1)      150.2       (45.0)
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 

Increase (decrease) in cash                                (0.0)       (7.5)      38.6          0.3         5.6        37.0 

Beginning cash balance                                      2.6         5.8       (2.4)         8.2        61.1        75.4 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Ending cash balance                                         2.6        (1.6)      36.2          8.4        66.7       112.3 
                                                     ==========  ==========  =========  ===========  ==========  ========== 

(1) Group "net income" is gross profit as presented in the statements of  
operations.                                                       

(2) Corporate net income includes all components of net income other than 
Group gross profit (ie:  Corporate G&A, other income and expense, 
interest expense, income taxes and minority interest).            

(3) "Net inter group/corporate cash transfers" are reflected as "financing
activities."                                                      

 Appendix C-16

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WASHINGTON GROUP INTERNATIONAL, INC.                
2004 PLAN                 
COMBINING STATEMENTS OF CASH FLOW                 
(IN MILLIONS OF DOLLARS)                  

                                                        [Enlarge/Download Table]


                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
                                                        2004        2004       2004        2004         2004        2004    
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
                                                       Power       Infra     I/P(+P/C)    Gov Serv    Corporate             
                                                       Total       Total      Total        Total       Total       Total    
                                                       -----       -----      -----        -----       -----       -----    
                                                                                                                            
Operating activities                                                                                                        
       Net Income                                          36.9        77.3       43.6         50.7      (125.7)       82.8 
       Depreciation                                         1.0        24.1        4.0          1.3         3.0        33.4 
       Goodwill amortization                                  -         0.2          -         13.6       (13.8)          - 
       Recognition of normalized profit                       -           -          -            -           -           - 
       Change in working capital components                (9.6)      (28.3)       1.3        (10.1)      (50.0)      (96.7)
       Other                                                  -        17.4          -         (5.9)       34.2        45.7 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by operations                                28.3        90.7       48.9         49.6      (152.3)       65.2 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 

Investing activities                                                                                                        
       Property and equipment additions                       -       (28.4)      (4.0)        (1.0)       (3.0)      (36.4)
       Property and equipment disposals                       -           -          -            -           -           - 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by investing activities                         -       (28.4)      (4.0)        (1.0)       (3.0)      (36.4)
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 

Financing activities                                                                                                        
       Net borrowing/(repayment) on credit facility           -          -           -            -           -           - 
       Net inter Group/Corporate cash transfers           (28.3)      (62.3)         -        (48.6)      139.2           - 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Cash provided by financing activities                     (28.3)      (62.3)         -        (48.6)      139.2           - 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Increase (decrease) in cash                                (0.0)          -       44.9         (0.0)      (16.1)       28.8 

Beginning cash balance                                      2.6        (1.6)      36.2          8.4        66.7       112.3 
                                                     ----------  ----------  ---------  -----------  ----------  ---------- 
Ending cash balance                                         2.6        (1.6)      81.1          8.4        50.7       141.2 
                                                     ==========  ==========  =========  ===========  ==========  ========== 

(1) Group "net income" is gross profit as presented in the statements of
operations.                                                     

(2) Corporate net income includes all components of net income other than 
Group gross profit (ie:  Corporate G&A, other income and expense, 
interest expense, income taxes and minority interest).            

(3) "Net inter group/corporate cash transfers" are reflected as "financing
activities."                                                      

 Appendix C-17

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APPENDIX D  

RAYTHEON'S STATEMENT CONCERNING 
ITS DISPUTES WITH THE DEBTORS 

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       =====================================================================
      The Following Statement was DRAFTED by RAYTHEON COMPANY. The Debtors
      dispute virtually all factual and legal assertions made by Raytheon.
       Nothing herein is, or shall be, construed, as an admission, waiver or
consent of any kind by the Debtors                            
       =====================================================================

     RAYTHEON"S BRIEF SUMMARY OF THE DISPUTES BETWEEN IT AND THE DEBTORS

ABSENCE OF "FRAUD"                                                              

    The Debtors, in their Disclosure Statement and other documents and
public statements, have described the various claims that they have asserted    
against Raytheon, including allegations based on "fraud." Raytheon vigorously   
disputes the Debtors"                                                           

claims.                                                                         

There was no "fraud" in the sale of Raytheon"s E&C business to WGI. This        
transaction was consummated after months of detailed due diligence and intense  
negotiations by the Debtors and a sophisticated team of advisors, including     
Credit Suisse First Boston, David Batchelder, Jones Day and Arthur Anderson.    
Coming on the heels of years of publicly-disclosed deterioration in the RE&C    
business which continued into the sale period, the RE&C sale was an arms-length,
fully-disclosed, commercial transaction initiated by the Debtors. Their         
extensive due diligence included:                                               

-      Sending teams to a comprehensive data room for extended
            periods of time during the period from October 1999 to April
2000;                                           

       -      All hands meetings in October 1999 and March 2000 with product
            line managers, members of senior corporate staff and project
managers;                                       

       -      Detailed financial review in March 2000 with senior management
               of the RE&C Businesses,  including a detailed project review of
               every major project  and a review of the first quarter outlook;

-      Site visits;                                           

       -      Interviews with product line managers and the project managers
for certain major projects; and                 

-      Detailed project reviews with senior management of the 
           RE&C Businesses (including management that would become WGI
           employees within a week), immediately before the closing of
the sale to WGI.                                

        WGI used information obtained by it during the due diligence period to
negotiate more favorable terms under the SPA - which went through more than 20  
iterations - including a reduction in the total compensation to be paid Raytheon
of at least $338 million and the granting of other significant value to WGI.    

RAYTHEON CLAIMS AGAINST WGI.                                                    

      Under the terms of the SPA and related agreements, Raytheon and RECI
have significant outstanding claims against WGI which render them, collectively,
the estate"s largest unsecured creditor. These include:                         

     GUARANTEED PROJECT CLAIMS. Under the terms of the SPA, Raytheon and
RECI left in place certain guarantees, letters of credit and surety bonds       
relating to uncompleted projects (referred to in the SPA as "SUPPORT            
AGREEMENTS"), and WGI is required to make full cash reimbursement to Raytheon   
for any amounts required to be paid by either Raytheon Seller under the Support 
Agreements. THIS REIMBURSEMENT OBLIGATION BY ITS TERMS IS NOT SUBJECT TO ANY    
RIGHT OF SET-OFF OR DEFENSE TO PAYMENT. In addition, Raytheon and RECI have     
common law and equitable rights as a performing surety to seek reimbursement    
from the applicable WGI subsidiary as the defaulting contractor for any payments
made under the Support Agreements.                                              

Appendix D-1

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     Raytheon estimates that its cash costs required to complete certain
projects abandoned by the Debtors will aggregate between $450 million to $700   
million and that its estimated cash exposure for the remaining projects subject 
to the Support Agreements could be as high as $125 million. These numbers are   
subject to adjustment. Claims arising from draws on certain Raytheon letters of 
credit currently are estimated to represent in excess of $25.6 million in the   
aggregate. The actual exposure of Raytheon and RECI will also be impacted by    
performance on the Ilijan and Red Oak projects.                                 

         RETAINED CLAIMS. Raytheon expects to make a claim of approximately $143
million in connection with certain "Retained Claims," as defined in the SPA. In 
the event that WGI does not fulfill its obligations with respect to the Retained
Claims, Raytheon will have claims against WGI for breach of the SPA.            

        INDEMNITY RIGHTS. Raytheon has additional indemnity claims against WGI
arising from provisions of the SPA. While it is too early to ascertain the      
extent of these claims, Raytheon is aware of several pre-petition and           
post-petition breaches by WGI that could result in significant claims against   
the Debtors by Raytheon.                                                        

PURCHASE PRICE ADJUSTMENT PROCESS.                                              

    TERMS OF SPA. Section 3.3 of the SPA provides for a purchase price
adjustment process based on the "Adjusted Non-Current Net Assets" and "Adjusted 
Net Working Capital" of the RE&C Businesses as of April 30, 2000.               

       These adjustments to the purchase price are required to be made based
on specific non-GAAP adjustments and methodologies outlined in Section 3.3 and  
SCHEDULE 3.3(a) of the SPA. These specific non-GAAP adjustments and             
methodologies were implemented and agreed to by the parties in order to         
implement the parties' agreement that this was a deal with (i) extensive due    
diligence, (ii) limited representations, (iii) otherwise on an "as is" basis,   
and (iv) with WGI in general accepting the risk of changes in the RE&C          
Businesses after April 30, 2000. The purchase price adjustment process was not  
intended to circumvent this basic deal structure.                               

    CURRENT STATUS. Raytheon has submitted its proposed purchase price
adjustments as required under Section 3.3 of the SPA, which shows that Raytheon 
is entitled to a purchase price adjustment in its favor of approximately $13    
million. WGI has submitted its proposed adjustments to the purchase price, and  
in this submission, WGI claims that it is entitled to a purchase price          
adjustment of approximately $469 million. Raytheon believes that, in preparing  
WGI's objections, WGI ignored most of the key ground rules set forth in Section 
3.3 and SCHEDULE 3.3(a) of the SPA, including the ground rules intended to limit
the effect of changes in the RE&C Businesses after April 30, 2000. The purchase 
price adjustment process is still pending, and Raytheon believes that this      
purchase price adjustment process could be lengthy, including any related       
appeals.                                                                        

ADDITIONAL CONTRACTUAL PROVISIONS                                               

         Raytheon believes that the parties" disputes must be evaluated in light
of the complete SPA, including provisions limiting the liability of Raytheon and
the remedies of WGI. In particular, Raytheon directs interested parties to      
Sections 13.8 and 16.3 of that agreement.                                       

To obtain a complete copy of the SPA, exclusive of schedules and exhibits, from 
Raytheon please contact:                                                        

Andrew J. Gallo, Esq.                                                           
Bingham Dana LLP                                                                
150 Federal Street                                                              
Boston, MA 02110                                                                
(617) 951-8000                                                                  

BASED ON ALL OF THE FOREGOING, THE RAYTHEON PARTIES WILL BE A MAJOR NET CREDITOR
OF WGI IN THE BANKRUPTCY REORGANIZATION, AND, THEREFORE, THERE WILL BE NO       
RECOVERY FOR CLASS 7 CREDITORS UNDER WGI'S CURRENT PLAN OF REORGANIZATION.      

Appendix D-2

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Appendix D-3

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APPENDIX E

      CURRENT SCHEDULE OF CRITICAL VENDOR CLAIMS PAID OR
TO BE PAID DURING THE CHAPTER 11 CASES

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----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                            
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                       
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  
25-Jul-01     I&M          San Roque                          10000168                 Ishikawajima-Harima Heavy Industries       
24-Jul-01     I&M          BHO                                47060778                 Rivera Masonry                             
23-Jul-01     I&M          BHO                                 1163891                 Williams Communications                    
23-Jul-01     I&M          BHO                                10012010                 Sandex Inc.                                
23-Jul-01     I&M          BHO                                47060779                 Rebar International Inc.                   
23-Jul-01     I&M          BHO                                47060784                 Nossman Gunther                            
23-Jul-01     I&M          BHO                                48008959                 Moderne Cabinets                           
23-Jul-01     I&M          BHO                                47060775                 McStrut Seismic Systems                    
23-Jul-01     I&M          BHO                                48008958                 Liberty Electric                           
23-Jul-01     I&M          BHO                                10012012                 Las Vegas Toilet Rental                    
23-Jul-01     I&M          BHO                                48008957                 Kendall Painting                           
23-Jul-01     I&M          BHO                                48008956                 Kalispell Overhead Door                    
23-Jul-01     I/P          BHO                                 1163890                 Idaho Sand & Gravel                        
23-Jul-01     I&M          BHO                                10012011                 Hansen Aggregates                          
23-Jul-01     GOVT         BHO                                 1164316                 Hamp's Construction LLC                    
23-Jul-01     I&M          BHO                                10012009                 Great West Surveying                       
23-Jul-01     I&M          BHO                                48008960                 GMT Consultants                            
23-Jul-01     I&M          BHO                                47060777                 Diversified Concrete                       
23-Jul-01     I&M          BHO                                48008955                 Della Silva Concrete                       
23-Jul-01     I&M          BHO                                48008954                 Creative Fuller Painting                   
23-Jul-01     I&M          BHO                                48008953                 Chuck Jenne Masonry                        
23-Jul-01     I&M          BHO                                47060776                 Blindheim Co.                              
23-Jul-01     I&M          BHO                                48008952                 Big Sky Plumbing                           
23-Jul-01     I&M          BHO                                47060774                 Applied Professional Services              
23-Jul-01     I&M          BHO                                48008951                 American General Contracting               
20-Jul-01     I&M          Infra Svcs                            12134                 WILLIAMS COMMUNICATIONS                    
20-Jul-01     P&C          TRAC                                1511172                 Western Int'l                              
20-Jul-01     I/P          3397                                 53101                  Western Exterminator                       
20-Jul-01     I/P          7278                                 53101                  Western Exterminator                       
20-Jul-01     GOVT         Cape-TRAC                            5703                   USA HOIST                                  
20-Jul-01     P&C          TRAC                                1511171                 Transo                                     
20-Jul-01     I/P          4837 - Monsanto                 670032, 646776              Siemens Building Technologies              
20-Jul-01     I/P          3397                             37413, 37412               Sabah International                        
20-Jul-01     I/P          7278                             37413, 37412               Sabah International                        
20-Jul-01     I/P          4837 - Monsanto                      4812                   Rice Equipment Co.                         
20-Jul-01     I/P          4837 - Monsanto                     464586                  Reis Environmental                         
20-Jul-01     GOVT         Cape-TRAC                            5698                   QUALICO STEEL                              
20-Jul-01     I/P          7278                              3994, 4474                Postal Supply Warehouse                    
20-Jul-01     I/P          7278                                 18023                  Plant Escape, Inc.                         
20-Jul-01     GOVT         Cape-TRAC                            5696                   PENINSULAR ENGINEERING                     
20-Jul-01     I/P          4837 - Monsanto                     122200                  Orkin Pest Control                         
20-Jul-01     I/P          4837 - Monsanto                  72767, 78768               Orkin Exterminating                        


-----------------------------------------------------------------------------------------------------------------------------     
  SALES, USE                                                                                                                      
  AND OTHER                                                                                      CRITICAL                         
  TRUST FUND                                 MECHANICS        FOREIGN                             TRADE                           
     TAXES                     UTILITIES       LIENS           VENDOR             SHIPPING        VENDOR            TOTAL*        
-----------------------------------------------------------------------------------------------------------------------------     
                                                                                                                                  
                                                               227,943                                               227,943      
                                                                                                    8,437              8,437      
                                  32                                                                                      32      
                                                                                                   29,944             29,944      
                                                                                                   22,840             22,840      
                                                                                                   27,606             27,606      
                                                                                                      135                135      
                                                                                                    1,853              1,853      
                                                                                                   20,857             20,857      
                                                                                                    1,255              1,255      
                                                                                                    1,646              1,646      
                                                                                                      317                317      
                                                                                                   25,379             25,379      
                                                                                                      328                328      
                                                                                                   87,710             87,710      
                                                                                                    5,852              5,852      
                                                                                                      760                760      
                                                                                                   27,381             27,381      
                                                                                                      296                296      
                                                                                                    1,900              1,900      
                                                                                                    4,150              4,150      
                                                                                                  111,344            111,344      
                                                                                                  124,203            124,203      
                                                                                                    2,772              2,772      
                                                                                                    3,685              3,685      
                                 734                                                                                     734      
                                                                                                    2,312              2,312      
                                                                                                    1,420              1,420      
                                                                                                   (1,420)            (1,420)     
                                                                                                   32,930             32,930      
                                                                                 3,321                                 3,321      
                                                                                                    3,230              3,230      
                                                                                                      526                526      
                                                                                                     (526)              (526)     
                                                                                                    2,172              2,172      
                                                                                                       50                 50      
                                                                                                   95,526             95,526      
                                                                                                      267                267      
                                                                                                      565                565      
                                                                                                  174,873            174,873      
                                                                                                    1,212              1,212      
                                                                                                    1,095              1,095      

*Negative Entries Indicate Subsequent Reversal of Authorization 

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                       
----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                            
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                       
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  
20-Jul-01     I/P          7278                                 36067                  MRC Management LLC                         
20-Jul-01     P&C          TRAC                                1511170                 Mitsubishi                                 
20-Jul-01     I/P          7278                              9701475-60                Mergenthaler                               
20-Jul-01     I/P          7278                               414860501                Mechanical Service & Systems Inc.          
20-Jul-01     POWER        BHO                               9990007784                LOVELLS                                    
20-Jul-01     I/P          BHO                                 1149958                 LANDMARK PROMOTIONS                        
20-Jul-01     P&C          TRAC                                1511169                 Incat                                      
20-Jul-01     I/P          4837 - Monsanto            MO2547T&M#66, MO254T&M#60        HTH Companies                              
20-Jul-01     I/P          3397                                102095                  Hoffman Media Systems                      
20-Jul-01     I/P          7278                                102095                  Hoffman Media Systems                      
20-Jul-01     I/P          4837 - Monsanto                     15830a                  Hartman Walsh Painting Co.                 
20-Jul-01     P&C          TRAC                                1511168                 Gordon                                     
20-Jul-01     P&C          TRAC                                1511167                 Geseaco                                    
20-Jul-01     GOVT         Oak Ridge-JTE                     C4848-4357                Edwards Supply Company, Inc                
20-Jul-01     I/P          4837 - Monsanto                 851295, 1200437             Crystal Clean                              
20-Jul-01     I/P          7278                        458-189857, 458-019952          Aramark Uniform Services                   
20-Jul-01     I/P          4837 - Monsanto                     M011145                 Aperture Technologies Inc.                 
20-Jul-01     P&C          TRAC                                1511166                 Amosco                                     
20-Jul-01     GOVT         TRAC                              21852-1613                AMERISTEEL                                 
20-Jul-01     I/P          4837 - Monsanto                     782032                  Alltype Fire Protection Services           
20-Jul-01     I/P          4837 - Monsanto                       289                   A&G Horticulture Services                  
19-Jul-01     I/P          7279 Timberline                      53101                  Western Exterminator                       
19-Jul-01     POWER        Trac                                07-182                  Wahlco                                     
19-Jul-01     I/P          TRAC 24056                         JOB 24056                VZ ENGINEERING CSP                         
19-Jul-01     I/P          TRAC 22573                         JOB 22573                TURABO TESTING INC                         
19-Jul-01     I/P          TRAC 22573                         JOB 22573                TRANSOCEANIC SHIPPING                      
19-Jul-01     I/P          TRAC 23314                         JOB 23314                TOMAS CUERDA INC                           
19-Jul-01     POWER        Trac                                07-180                  Toltest                                    
19-Jul-01     I/P          TRAC 24052                         JOB 24052                THE OFFICE SHOP                            
19-Jul-01     I/P          TRAC 03481                         JOB 03481                THE OFFICE SHOP                            
19-Jul-01     GOVT         WS-Timberline                     3589-047607               Sybron Chemicals                           
19-Jul-01     POWER        Timberline                         470904456                Stewarts                                   
19-Jul-01     I/P          TRAC 22573                         JOB 22573                STERIS CORP                                
19-Jul-01     CORP         BHO                                 1163434                 STATE OF VIRGINIA                          
19-Jul-01     CORP         BHO                                 1163436                 STATE OF TEXAS                             
19-Jul-01     CORP         BHO                                 1163435                 STATE OF ARKANSAS                          
19-Jul-01     I/P          TRAC 03474                         JOB 03474                SIR SPEEDY                                 
19-Jul-01     I/P          TRAC 21862                         JOB 21862                SAFECO                                     
19-Jul-01     I/P          7280 Timberline                  37413, 37412               Sabah International                        
19-Jul-01     I/P          TRAC 22573                         JOB 22573                RUSH INDUSTRIAL HARDWARE                   
19-Jul-01     I/P          TRAC 22573                         JOB 22573                ROGER ELECTRIC                             
19-Jul-01     GOVT         WS-Timberline                     3589-047585               REIS Environmental                         


-----------------------------------------------------------------------------------------------------------------------------     
 SALES, USE                                                                                                                       
 AND OTHER                                                                                       CRITICAL                         
 TRUST FUND                                  MECHANICS        FOREIGN                             TRADE                           
    TAXES                      UTILITIES       LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*        
-----------------------------------------------------------------------------------------------------------------------------     
                                                                                                                                  
                                                                                                    1,808              1,808      
                                                                                                  166,080            166,080      
                                                                                                   38,853             38,853      
                                                                                                      419                419      
                                                                                                   12,706             12,706      
                                                                                                     (528)              (528)     
                                                                                                      706                706      
                                                                                                    8,676              8,676      
                                                                                                      295                295      
                                                                                                     (295)              (295)     
                                                                                                    4,595              4,595      
                                                                                                   14,440             14,440      
                                                                                                    1,449              1,449      
                                                                                                      580                580      
                                                                                                      446                446      
                                                                                                       23                 23      
                                                                                                    1,567              1,567      
                                                                                                    1,526              1,526      
                                                                                                      482                482      
                                                                                                       51                 51      
                                                                                                      600                600      
                                                                                                    1,420              1,420      
                                                                                                   23,662             23,662      
                                                                                                   22,976             22,976      
                                                                                                      406                406      
                                                                                27,006                                27,006      
                                                                                                      325                325      
                                                                                                    3,924              3,924      
                                                                                                      739                739      
                                                                                                   (4,065)            (4,065)     
                                                                                                      208                208      
                                                                                                       40                 40      
                                                                                                   45,000             45,000      
                   16                                                                                                     16      
                  423                                                                                                    423      
                2,070                                                                                                  2,070      
                                                                                                      420                420      
                                                                                                       35                 35      
                                                                                                      526                526      
                                                                                                       30                 30      
                                                                                                       98                 98      
                                                                                                      439                439      

*Negative Entries Indicate Subsequent Reversal of Authorization 

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----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                            
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                       
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  
19-Jul-01     POWER        Trac                                07-178                  RAM Industrial                             
19-Jul-01     GOVT         WS-Timberline                     3589-047604               PWSD #2, St Charles                        
19-Jul-01     I/P          TRAC 24056                         JOB 24056                POPULAR LEASING & RENTAL INC               
19-Jul-01     I/P          TRAC 22573                         JOB 22573                PACKAGING CONTROLS INSPECTION              
19-Jul-01     I/P          RUST CONSTRUCTORS                  10129203                 NORTH CAROLINA                             
19-Jul-01     I/P          TRAC 22573                         JOB 22573                NEMAR TECHNOLOGY GROUP                     
19-Jul-01     POWER        Trac                                07-172                  MI Mech. Insul.                            
19-Jul-01     I/P          TRAC 21862                         JOB 21862                Mc JUNKIN                                  
19-Jul-01     I/P          TRAC 24052                         JOB 24052                MAR-LAND INDUSTRIAL CONTRACTORS            
19-Jul-01     I/P          TRAC 21860                         JOB 21860                LABCORP                                    
19-Jul-01     I/P          TRAC 22573                         JOB 22573                KINETICS SYSTEMS CARIBE INC                
19-Jul-01     I/P          BHO                                 1163279                 INTERNATIONAL INDUSTRIAL CONTRACTING       
19-Jul-01     I/P          TRAC 24052                         JOB 24052                INSTANT PRINT SHOP                         
19-Jul-01     POWER        Trac                                07-166                  Inland Waters                              
19-Jul-01     I/P          TRAC 22573                         JOB 22573                INDUSTRIAL FITTINGS & VALVES               
19-Jul-01     I/P          TRAC 22573                         JOB 22573                IMA NORTH AMERICA INC                      
19-Jul-01     I/P          7282 Timberline                     102095                  Hoffman Media Systems                      
19-Jul-01     POWER        Trac                                07-163                  Hilti Inc                                  
19-Jul-01     I/P          TRAC 22566                         JOB 22566                GOODS SERVICES REALTY                      
19-Jul-01     I/P          TRAC 22573                         JOB 22573                GIRTON MFG. CO INC                         
19-Jul-01     I/P          TRAC 22573                         JOB 22573                GIRTON MFG. CO INC                         
19-Jul-01     I/P          TRAC 22573                         JOB 22573                GIRTON MFG. CO INC                         
19-Jul-01     I/P          TRAC 22573                         JOB 22573                GIRARD MFG. CO INC                         
19-Jul-01     I/P          7281 Timberline                   0138100-IN                Future Packaging                           
19-Jul-01     I/P          TRAC 22569                         JOB 22569                FERRETERIA M. OTERO CLA, INC.              
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EXIDE                                      
19-Jul-01     I/P          TRAC 22573                         JOB 22573                ENVIRO CONSULT INC                         
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     I/P          TRAC 22573                         JOB 22573                EMERY WORLDWIDE                            
19-Jul-01     GOVT         WS-Timberline                     3589-047614               Dynamic Computer                           
19-Jul-01     I/P          TRAC 22566                         JOB 22566                DOCUMENT COMPANY                           
19-Jul-01     POWER        Timberline                         470904478                Cutting Edge Services, Inc.                
19-Jul-01     GOVT         WS-Timberline                     3589-047583               Construction Data Srv                      
19-Jul-01     I/P          7278 Timberline                   5343, 5379                CIWA                                       
19-Jul-01     I/P          TRAC 24272                         JOB 24272                BLUE PRINTS PLUS                           


-----------------------------------------------------------------------------------------------------------------------------     
 SALES, USE                                                                                                                       
 AND OTHER                                                                                       CRITICAL                         
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                          
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*       
-----------------------------------------------------------------------------------------------------------------------------     
                                                                                                                                  
                                                                                                   10,786             10,786      
                                 987                                                                                     987      
                                                                                                    1,148              1,148      
                                                                                                    1,900              1,900      
                                                                                                      875                875      
                                                                                                    1,906              1,906      
                                                                                                   40,500             40,500      
                                                                                                       33                 33      
                                                                                                    1,538              1,538      
                                                                                                       76                 76      
                                                                                                   10,570             10,570      
                                                                                                  100,000            100,000      
                                                                                                      114                114      
                                                                                                    1,716              1,716      
                                                                                                    1,085              1,085      
                                                                                                   62,800             62,800      
                                                                                                      295                295      
                                                                                                       66                 66      
                                                                                                      102                102      
                                                                                                    6,420              6,420      
                                                                                                    5,988              5,988      
                                                                                                   (3,327)            (3,327)     
                                                                                                   25,447             25,447      
                                                                                                    1,064              1,064      
                                                                                                       30                 30      
                                                                                                      809                809      
                                                                                                      605                605      
                                                                                21,731                                21,731      
                                                                                 9,598                                 9,598      
                                                                                 7,572                                 7,572      
                                                                                 2,927                                 2,927      
                                                                                 1,797                                 1,797      
                                                                                 1,580                                 1,580      
                                                                                   633                                   633      
                                                                                   377                                   377      
                                                                                   350                                   350      
                                                                                                      254                254      
                                                                                                       34                 34      
                                                                                                   37,949             37,949      
                                                                                                    1,083              1,083      
                                                                                                    2,449              2,449      
                                                                                                       77                 77      

*Negative Entries Indicate Subsequent Reversal of Authorization 

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----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                            
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                       
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  
19-Jul-01     I/P          RUST CONSTRUCTORS                  10129201                 BELL SOUTH                                 
19-Jul-01     I/P          TRAC 22566                         JOB 22566                 ART-DRAFT AUTHORITY                       
19-Jul-01     I/P          TRAC 24056                         JOB 24056                 AIRBORNE EXPRESS                          
19-Jul-01     I/P          TRAC 22573                         JOB 22573                 AEROTECH FILTRATION                       
18-Jul-01     I/P          BHO                                 1163278                  YELLOW CAB                                
18-Jul-01     CORP         BHO                                 1163277                  XEROX CORPORATION                         
18-Jul-01     GOVT         BHO                                 1163275                  WORLDCOM                                  
18-Jul-01     I/P          BHO                               9990007744                 WONG AND PARTNERS                         
18-Jul-01     GOVT         Buckley-TRAC                        5141123                 Wolfpack                                   
18-Jul-01     GOVT         TRAC                              21852-1602                 WISE EL SANTO                             
18-Jul-01     I&M          BHO                                49017708                  Western States                            
18-Jul-01     GOVT         BHO                                 1163274                  WESTERN CULTURAL RESOURCE MANAGEMENT      
18-Jul-01     POWER        TRAC                                1921115                 WEIR PUMPS LIMITED                         
18-Jul-01     I/P          BHO                                 1163272                  W E BOWERS INC                            
18-Jul-01     I/P          BHO                                 1163271                  VISA ADVISORS INC                         
18-Jul-01     CORP         BHO                                 1163270                  VERTEX INC                                
18-Jul-01     I&M          BHO                                49017707                  Vallen Safety Corp                        
18-Jul-01     CORP         BHO                                 1163266                  UNTIED MESSAGING                          
18-Jul-01     I/P          BHO                                 1163268                  UNITED RENTALS INC                        
18-Jul-01     CORP         BHO                                 1163267                  UNITED MICRO DATA INC                     
18-Jul-01     POWER        TRAC                                1921114                 TURTLE & HUGUES                            
18-Jul-01     GOVT         TRAC                              22556-0531                 T-THERMAL COMPANY                         
18-Jul-01     GOVT         TRAC                              22556-0532                 T-THERMAL COMPANY                         
18-Jul-01     I&M          BHO                                47060549                  Triple R Heavy Haul                       
18-Jul-01     I&M          BHO                                10011974                  Tranch Safety Equip                       
18-Jul-01     GOVT         BHO                                 1163265                  TOOL AND ANCHOR SUPPLY                    
18-Jul-01     I&M          InfraSvcs                            10724                  TERRACON CONSULT. INC.                     
18-Jul-01     CORP         BHO                                 1163263                  TED DUMONT HVAC INC                       
18-Jul-01     I/P          BHO                                 1163262                  SUBURBAN IRRIGATION                       
18-Jul-01     I/P          BHO                                 1163261                  STRUCTURAL INTEGRITY ASSOCIATES           
18-Jul-01     I&M          BHO                                10011965                  Stewart and Sundell                       
18-Jul-01     I&M          BHO                                10011964                  Steel Engineers                           
18-Jul-01     CORP         BHO                                 1162725                  STATE OF TENNESSEE (DEPT. OF REVENUE)     
18-Jul-01     CORP         BHO                                 1163041                  STATE OF NEW JERSEY (DIVISION OF REVENUE) 
18-Jul-01     CORP         BHO                                 1162724                  STATE OF DELAWARE (DIVISION OF REVENUE)   
18-Jul-01     CORP         BHO                                 600045                   STATE OF DELAWARE (DIVISION OF REVENUE)   
18-Jul-01     CORP         BHO                                 1163259                  SPRINT                                    
18-Jul-01     I/P          BHO                                 1163258                  SOUTHWEST ENGINEERS                       
18-Jul-01     I&M          InfraSvcs                            10480                  SOUTHERN CONNECTICUT GAS                   
18-Jul-01     I&M          Makati                               1360                    Social Security System                    
18-Jul-01     I&M          Makati                               1360                    Social Security System                    
18-Jul-01     I&M          Makati                               1345                    Social Security System                    


-----------------------------------------------------------------------------------------------------------------------------     
 SALES, USE                                                                                                                       
 AND OTHER                                                                                       CRITICAL                         
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                          
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*       
-----------------------------------------------------------------------------------------------------------------------------     
                                                                                                                                  
                                 336                                                                                     336      
                                                                                                      242                242      
                                                                                    41                                    41      
                                                                                                   44,000             44,000      
                                                                                                       30                 30      
                                                                                                      433                433      
                                  19                                                                                      19      
                                                                20,371                                                20,371      
                                                                                                   16,575             16,575      
                                                                                                    5,882              5,882      
                                                                                                    3,495              3,495      
                                                                                                    1,250              1,250      
                                                                                                   19,112             19,112      
                                                                                                    7,974              7,974      
                                                                                                      103                103      
                                                                                                      127                127      
                                                                                                       70                 70      
                                                                                                   14,137             14,137      
                                                                                                      315                315      
                                                                                                    1,696              1,696      
                                                                                                   58,838             58,838      
                                                                                                      152                152      
                                                                                                       96                 96      
                                                                                 4,500                                 4,500      
                                                                                                    1,970              1,970      
                                                                                                    1,297              1,297      
                                                                                                   26,071             26,071      
                                                                                                      200                200      
                                                                                                    1,031              1,031      
                                                                                                    1,000              1,000      
                                                                                                   41,304             41,304      
                                                                                                   62,866             62,866      
                   47                                                                                                     47      
               23,045                                                                                                 23,045      
               14,421                                                                                                 14,421      
                    6                                                                                                      6      
                                                                                                       63                 63      
                                                                                                      216                216      
                                                                                                        4                  4      
                                                                   (28)                                                  (28)     
                                                                   (36)                                                  (36)     
                  (38)                                                                                                   (38)     

*Negative Entries Indicate Subsequent Reversal of Authorization 

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                       
----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                            
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                       
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  
18-Jul-01     I&M          Makati                               1348                    Social Security System                    
18-Jul-01     I/P          BHO                                 1163257                  SMI                                       
18-Jul-01     POWER        BHO                                 1163256                  SINCLAIR MOVING AND STORAGE               
18-Jul-01     I/P          BHO                                 1163255                  SHIRLEY PAINTING                          
18-Jul-01     GOVT         TRAC                              22561-0623                 SCOTT SPECIALTY GASES                     
18-Jul-01     I/P          BHO                                 1163254                  SCHARDEIN AND ASSOCIATES                  
18-Jul-01     I&M          BHO                                10011973                  Sandvick Equipment                        
18-Jul-01     I&M          BHO                                 3000539                  Rosemount                                 
18-Jul-01     I&M          InfraSvcs                            1584                   ROSEMARY BRENNAN CURTIN,                   
18-Jul-01     GOVT         BHO                                 1163253                  ROCKY MOUNTAIN MAIL DELIVERY              
18-Jul-01     GOVT         TRAC                              21852-1601                 ROBERTS BROTHERS                          
18-Jul-01     P&C          BHO                                 1163252                  RIDGWAYS                                  
18-Jul-01     I&M          BHO                                10011972                  Republic Silver State Disposal            
18-Jul-01     I&M          InfraSvcs                            9641                   REPRO IMAGE                                
18-Jul-01     GOVT         TRAC                              22561-0625                 RELIZON COMPANY                           
18-Jul-01     GOVT         BHO                                 1163250                  REIS ENVIRONMENTAL INC                    
18-Jul-01     GOVT         TRAC                              22556-0521                 RE POWELL DISTRIBUTING CO.                
18-Jul-01     GOVT         BHO                                 1163249                  QWEST                                     
18-Jul-01     I/P          BHO                                 1163248                  QUALITY METAL IMAGES INC                  
18-Jul-01     I/P          BHO                                 1163247                  PSI                                       
18-Jul-01     I/P          BHO                                 1163246                  PRFC INC                                  
18-Jul-01     CORP         BHO                                 1163245                  POTTING SHED INC                          
18-Jul-01     GOVT         TRAC                              22556-0529                 PHYSIO CONTROLS                           
18-Jul-01     I&M          Makati                               1346                    Philhealth                                
18-Jul-01     GOVT         TRAC                              22556-0525                 PETERSON ELECTRIC                         
18-Jul-01     GOVT         TRAC                              22556-0530                 PARAMOUNT SUPPLY COMPANY                  
18-Jul-01     I&M          InfraSvcs                            8484                   OVE ARUP & PARTNERS                        
18-Jul-01     GOVT         TRAC                              22556-0535                 OREGON STATE POLICE                       
18-Jul-01     I&M          InfraSvcs                            8284                   ONE HOUR MOTOPHOTO                         
18-Jul-01     I&M          InfraSvcs                            7802                   NINYO & MOORE                              
18-Jul-01     I/P          BHO                                 1163242                  NEXTEL PARTNERS                           
18-Jul-01     I/P          BHO                                 1163240                  NEXTEL COMMUNICATIONS                     
18-Jul-01     GOVT         BHO                                 1163241                  NEXTEL COMMUNICATIONS                     
18-Jul-01     I&M          BHO                                47060548                  Nevada Power Co                           
18-Jul-01     I&M          BHO                                10011971                  Nevada Power                              
18-Jul-01     GOVT         TRAC                              21852-1608                 MORRISON CONSTRUCTION                     
18-Jul-01     POWER        BHO                                 1163239                  MORGAN LEWIS AND BOCKIUS                  
18-Jul-01     I&M          San Roque                          10000165                  Monark Equipment Corporation              
18-Jul-01     GOVT         BHO                                 1162719                  MILLER DRILLING CO                        
18-Jul-01     I/P          BHO                                 1163238                  MICHIGAN COFFEE AND VENDING               
18-Jul-01     I&M          San Roque                            2400                    MHE Dematic Phils Inc                     
18-Jul-01     I/P          BHO                                 1163237                  MERCANTILE CAPITAL LLC                    


-----------------------------------------------------------------------------------------------------------------------------     
 SALES, USE                                                                                                                       
 AND OTHER                                                                                       CRITICAL                         
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                          
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*       
-----------------------------------------------------------------------------------------------------------------------------     
                                                                                                                                  
                                                                  (388)                                                 (388)     
                                                                                                       98                 98      
                                                                                                    2,490              2,490      
                                                                                                    1,575              1,575      
                                                                                                       47                 47      
                                                                                                    4,226              4,226      
                                                                                                      441                441      
                                                                                                    3,539              3,539      
                                                                                                    2,190              2,190      
                                                                                   347                                   347      
                                                                                                       64                 64      
                                                                                                      302                302      
                                 194                                                                                     194      
                                                                                                      555                555      
                                                                                                      207                207      
                                                                                                      236                236      
                                                                                                      800                800      
                                  15                                                                                      15      
                                                                                                      305                305      
                                                                                                    4,581              4,581      
                                                                                                   31,111             31,111      
                                                                                                      659                659      
                                                                                                      162                162      
                   (7)                                                                                                    (7)     
                                                                                                    4,270              4,270      
                                                                                                       20                 20      
                                                                                                   64,746             64,746      
                                                                                                    1,688              1,688      
                                                                                                       17                 17      
                                                                                                   55,912             55,912      
                                                                                                      842                842      
                                                                                                    2,310              2,310      
                                 455                                                                                     455      
                                 118                                                                                     118      
                                 337                                                                                     337      
                                                                                                  141,153            141,153      
                                                                                                       35                 35      
                                                                 3,380                                                 3,380      
                                                                                                   20,528             20,528      
                                                                                                       21                 21      
                                                                 2,316                                                 2,316      
                                 351                                                                                     351      


*Negative Entries Indicate Subsequent Reversal of Authorization 

 Page 5 of 362

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                       
----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                            
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                       
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  
18-Jul-01     GOVT         TRAC                              21852-1611                 MCMASTER CARR                             
18-Jul-01     I&M          InfraSvcs                            7482                   MCE GROUP                                  
18-Jul-01     I&M          InfraSvcs                            7294                   MCCREEDY CONSULTING                        
18-Jul-01     I&M          InfraSvcs                            6385                   MBI MEDIA                                  
18-Jul-01     GOVT         BHO                                 1163236                  MATERIALS MANAGEMENT GROUP                
18-Jul-01     I&M          InfraSvcs                            5651                   LONG ISLAND RAILROAD                       
18-Jul-01     I/P          BHO                                 1162718                  LOBAR                                     
18-Jul-01     I&M          InfraSvcs                            5489                   LDO LIMITED                                
18-Jul-01     I&M          BHO                                10011969                  Las Vegas Valley Water                    
18-Jul-01     I&M          BHO                                10011970                  Las Vegas Valley Water                    
18-Jul-01     I&M          BHO                                10011967                  Las Vegas Valley Water                    
18-Jul-01     I&M          BHO                                10011968                  Las Vegas Valley Water                    
18-Jul-01     I/P          BHO                                 1163234                  LANDAUER INC                              
18-Jul-01     GOVT         TRAC                              22556-0537                 LAB SAFETY SUPPLY                         
18-Jul-01     GOVT         TRAC                              22556-0536                 LAB SAFETY SUPPLY                         
18-Jul-01     I&M          San Roque                            2399                    JT Oil Phils Inc                          
18-Jul-01     I&M          InfraSvcs                            1777                   JOHN CHANCE LAND SURVEYS, INC.             
18-Jul-01     I/P          BHO                                 1163233                  JAY CHEVROLET                             
18-Jul-01     I/P          BHO                                 1163232                  JACOB BARON                               
18-Jul-01     I&M          InfraSvcs                            4465                   IRON MOUNTAIN                              
18-Jul-01     I/P          BHO                                 1163231                  INTERTEK TESTING SERVICES                 
18-Jul-01     POWER        BHO                                 1163230                  INTERSTATE LOCKSMITH INC                  
18-Jul-01     I/P          BHO                                 1163229                  INTERNATIONAL SOS                         
18-Jul-01     I/P          BHO                                 1163226                  INTERGRAPH CORP                           
18-Jul-01     I/P          BHO                                 1163227                  INTERGRAPH CORP                           
18-Jul-01     I/P          BHO                                 1163227                  INTERGRAPH CORP                           
18-Jul-01     P&C          BHO                                 1163228                  INTERGRAPH CORP                           
18-Jul-01     I/P          BHO                                 1163226                  INTERGRAPH CORP                           
18-Jul-01     I&M          InfraSvcs                            4089                   IKON OFFICE SOLUTIONS                      
18-Jul-01     I&M          InfraSvcs                            4005                   IBI GROUP                                  
18-Jul-01     I&M          InfraSvcs                            3928                   HUMBOLDT ENGINEERING &                     
18-Jul-01     POWER        TRAC                                1921106                 HITACHI                                    
18-Jul-01     GOVT         TRAC                              22556-0524                 HELLER & SONS                             
18-Jul-01     I&M          Makati                               1349                    HDMF                                      
18-Jul-01     CORP         BHO                                 1163225                  HAYSTACK SYSTEMS                          
18-Jul-01     I&M          InfraSvcs                            3532                   HARDING ESE, INC                           
18-Jul-01     I&M          InfraSvcs                            3399                   HANKARD ENGINEERING                        
18-Jul-01     GOVT         BHO                                 1163223                  GUARANTEE ELECTRICAL                      
18-Jul-01     GOVT         BHO                                 1163224                  GUARANTEE ELECTRICAL                      
18-Jul-01     I&M          InfraSvcs                            3377                   GROUND ENGINEERING                         
18-Jul-01     I&M          InfraSvcs                            3352                   GREENMAN-PEDERSEN, INC.                    
18-Jul-01     GOVT         BHO                                 1163222                  GRAYBAR ELECTRIC CO                       


-----------------------------------------------------------------------------------------------------------------------------     
 SALES, USE                                                                                                                       
 AND OTHER                                                                                       CRITICAL                         
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                          
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*       
-----------------------------------------------------------------------------------------------------------------------------     
                                                                                                                                  
                                                                                                      540                540      
                                                                                                   19,213             19,213      
                                                                                                    1,108              1,108      
                                                                                                       64                 64      
                                                                                                   21,880             21,880      
                                                                                                   13,688             13,688      
                                                                                                   55,879             55,879      
                                                                                                      (14)               (14)     
                               1,052                                                                                   1,052      
                                 242                                                                                     242      
                                  16                                                                                      16      
                                   6                                                                                       6      
                                                                                                    1,060              1,060      
                                                                                                       90                 90      
                                                                                                     (120)              (120)     
                                                                 5,168                                                 5,168      
                                                                                                   57,000             57,000      
                                                                                                    1,114              1,114      
                                                                 1,174                                                 1,174      
                                                                                                      100                100      
                                                                                                    1,100              1,100      
                                                                                                      460                460      
                                                                                                    1,200              1,200      
                                                                                                   35,454             35,454      
                                                                                                   25,087             25,087      
                               2,948                                                                                   2,948      
                                                                                                    1,751              1,751      
                               1,081                                                                                   1,081      
                                                                                                       17                 17      
                                                                                                   14,130             14,130      
                                                                                                    5,505              5,505      
                                                                                                  563,320            563,320      
                                                                                                      379                379      
                   (8)                                                                                                    (8)     
                                                                                                    3,050              3,050      
                                                                                                   47,577             47,577      
                                                                                                    1,074              1,074      
                                                                                                    1,630              1,630      
                                                                                                      937                937      
                                                                                                   50,156             50,156      
                                                                                                    8,470              8,470      
                                                                                                    3,068              3,068      

*Negative Entries Indicate Subsequent Reversal of Authorization 

 Page 6 of 362

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                       
----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                            
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                       
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  
18-Jul-01     GOVT         TRAC                              21852-1612                 GRAYBAR                                   
18-Jul-01     GOVT         TRAC                              21852-1610                 GRAYBAR                                   
18-Jul-01     GOVT         BHO                                 1163221                  GLOBAL ENGINEERING DOCUMENTS              
18-Jul-01     POWER        TRAC                                1161398                 GEA                                        
18-Jul-01     GOVT         TRAC                              21852-1603                 GE SUPPLY                                 
18-Jul-01     GOVT         BHO                                 1163220                  GE CAPITAL                                
18-Jul-01     I/P          BHO                                 1163219                  GCM CONSULTING SERVICES                   
18-Jul-01     GOVT         BHO                                 1162720                  FORTE SECURITY                            
18-Jul-01     POWER        BHO                                 1163218                  FEDERAL EXPRESS CORP                      
18-Jul-01     I/P          BHO                                 1163218                  FEDERAL EXPRESS CORP                      
18-Jul-01     GOVT         BHO                                 1163217                  FABICK TRACTOR CO                         
18-Jul-01     GOVT         TRAC                              22561-0624                 EXCHANGE SUPPLY                           
18-Jul-01     I/P          BHO                                 1163216                  ENTIRE REPRODUCTIONS                      
18-Jul-01     I/P          BHO                                 1163215                  ENTERPRISE RENT-A-CAR                     
18-Jul-01     I&M          InfraSvcs                            2307                   ENTERPRISE LEASING CO.                     
18-Jul-01     I&M          InfraSvcs                            2123                   ECOLOGICAL DESIGN, INC                     
18-Jul-01     I&M          InfraSvcs                            2127                   ECCO CONSULTING                            
18-Jul-01     GOVT         TRAC                              22556-0526                 EAST OREGONIAN                            
18-Jul-01     GOVT         TRAC                              22556-0527                 EAST OREGONIAN                            
18-Jul-01     GOVT         TRAC                              22556-0528                 EAST OREGONIAN                            
18-Jul-01     I/P          BHO                                 1146225                  DUPONT FLOORING SYSTEMS                   
18-Jul-01     GOVT         TRAC                              21852-1604                 DRAGO                                     
18-Jul-01     I/P          BHO                                 1146224                  DOGGRELL PAINTING                         
18-Jul-01     I/P          BHO                                 1163213                  DAYTON BLUE PRINT CO                      
18-Jul-01     I&M          BHO                                49017706                  CTC Analytical                            
18-Jul-01     POWER        BHO                                 1163211                  CORT FURNITURE RENTAL                     
18-Jul-01     I/P          BHO                                 1163210                  CONSUMERS ENERGY                          
18-Jul-01     I/P          BHO                                 1163209                  CONSORTIUM                                
18-Jul-01     GOVT         TRAC                              21852-1600                 CONSOLIDATED PIPE                         
18-Jul-01     GOVT         BHO                                 1163208                  CONSOLIDATED ELECTRICAL                   
18-Jul-01     CORP         BHO                                 1163207                  COMPUTER TECHNOLOGY GROUP                 
18-Jul-01     CORP         BHO                                 1163206                  CISCO SYSTEMS                             
18-Jul-01     CORP         BHO                                 1163205                  CINGULAR WIRELESS                         
18-Jul-01     CORP         BHO                                 1163204                  CINGULAR WIRELESS                         
18-Jul-01     I&M          InfraSvcs                            1204                   CHAUDHARY & ASSOC. INC.                    
18-Jul-01     I&M          InfraSvcs                             934                   CH2M HILL                                  
18-Jul-01     GOVT         TRAC                              22556-0523                 CASCADE NUT AND BOLT                      
18-Jul-01     GOVT         TRAC                              21852-1609                 CANNON CONTRACTING                        
18-Jul-01     I&M          BHO                                10011966                  Boulder Auto                              
18-Jul-01     I/P          BHO                                 1163202                  BOCK AND CLARK LTD                        
18-Jul-01     GOVT         TRAC                              22556-0522                 BLISS PRINTING AND COPY CENTER            
18-Jul-01     GOVT         TRAC                              22556-0534                 BLISS PRINTING AND COPY CENTER            


-----------------------------------------------------------------------------------------------------------------------------     
 SALES, USE                                                                                                                       
 AND OTHER                                                                                       CRITICAL                         
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                          
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*       
-----------------------------------------------------------------------------------------------------------------------------     
                                                                                                                                  
                                                                                                    1,181              1,181      
                                                                                                      137                137      
                                                                                                       61                 61      
                                                                                                1,214,000          1,214,000      
                                                                                                   19,392             19,392      
                                                                                                      659                659      
                                                                                                    2,500              2,500      
                                                                                                      126                126      
                                                                                   422                                   422      
                                                                                    22                                    22      
                                                                                                    3,092              3,092      
                                                                                                      116                116      
                                                                                                      143                143      
                                                                                                       78                 78      
                                                                                                    4,117              4,117      
                                                                                                       94                 94      
                                                                                                    5,600              5,600      
                                                                                                      553                553      
                                                                                                      423                423      
                                                                                                      401                401      
                                                                                                    2,142              2,142      
                                                                                                       12                 12      
                                                                                                    3,640              3,640      
                                                                                                      184                184      
                                                                                                       49                 49      
                                                                                                    1,429              1,429      
                                   3                                                                                       3      
                                                                                                      912                912      
                                                                                                      127                127      
                                                                                                      177                177      
                                                                                                      100                100      
                                                                                                    4,129              4,129      
                               4,517                                                                                   4,517      
                                                                                                      184                184      
                                                                                                    1,311              1,311      
                                                                                                    7,911              7,911      
                                                                                                      386                386      
                                                                                                    3,067              3,067      
                                                                                                      788                788      
                                                                                                    1,200              1,200      
                                                                                                      104                104      
                                                                                                       39                 39      

*Negative Entries Indicate Subsequent Reversal of Authorization 

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                        
-----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                             
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                        
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                   
18-Jul-01     GOVT         TRAC                              22556-0533                 BLISS PRINTING AND COPY CENTER             
18-Jul-01     I&M          InfraSvcs                             690                   BIRD'S MOVING & STORAGE                     
18-Jul-01     I/P          BHO                                 1163201                  BIOMERIEUX COMMUNICATIONS                  
18-Jul-01     I/P          BHO                                 1163198                  BELLSOUTH                                  
18-Jul-01     CORP         BHO                                 1163199                  BELLSOUTH                                  
18-Jul-01     I/P          BHO                                 1163200                  BELLSOUTH                                  
18-Jul-01     I&M          InfraSvcs                             565                   BECK & BAIRD                                
18-Jul-01     POWER        TRAC                                1921110                 BDT ENGINEERING                             
18-Jul-01     P&C          BHO                                 1161814                  BDP INTERNATIONAL INC                      
18-Jul-01     I/P          BHO                               9990007745                 B AND M BUSINESS 7 CONSULTANCY             
18-Jul-01     I&M          InfraSvcs                            2549                   AT&T WIRELESS SERVICES                      
18-Jul-01     CORP         BHO                                 1163185                  AT AND T                                   
18-Jul-01     CORP         BHO                                 1163192                  AT AND T                                   
18-Jul-01     I/P          BHO                                 1163194                  AT AND T                                   
18-Jul-01     POWER        BHO                                 1163190                  AT AND T                                   
18-Jul-01     GOVT         BHO                                 1163189                  AT AND T                                   
18-Jul-01     I/P          BHO                                 1163193                  AT AND T                                   
18-Jul-01     I/P          BHO                                 1163192                  AT AND T                                   
18-Jul-01     I/P          BHO                                 1163193                  AT AND T                                   
18-Jul-01     CORP         BHO                                 1163193                  AT AND T                                   
18-Jul-01     GOVT         BHO                                 1163190                  AT AND T                                   
18-Jul-01     CORP         BHO                                 1163197                  AT AND T                                   
18-Jul-01     CORP         BHO                                 1163195                  AT AND T                                   
18-Jul-01     CORP         BHO                                 1163187                  AT AND T                                   
18-Jul-01     I/P          BHO                                 1163196                  AT AND T                                   
18-Jul-01     I/P          BHO                                 1163186                  AT AND T                                   
18-Jul-01     I/P          BHO                                 1163188                  AT AND T                                   
18-Jul-01     CORP         BHO                                 1163191                  AT AND T                                   
18-Jul-01     I&M          InfraSvcs                             309                   ASSOCIATED ENGINEERS,INC                    
18-Jul-01     GOVT         BHO                                 1163184                  ARVADA RENT ALLS INC                       
18-Jul-01     I&M          InfraSvcs                             413                   ARU ENGINEERING                             
18-Jul-01     GOVT         BHO                                 1163183                  ARCUS DATA SECURITY INCORP                 
18-Jul-01     I/P          BHO                                 1163182                  ARCOM                                      
18-Jul-01     I/P          BHO                                 1163181                  AMERITECH                                  
18-Jul-01     I/P          BHO                                 1163181                  AMERITECH                                  
18-Jul-01     GOVT         TRAC                              21852-1605                 AMERISTEEL                                 
18-Jul-01     GOVT         TRAC                              21852-1606                 AMERISTEEL                                 
18-Jul-01     GOVT         TRAC                              21852-1607                 AMERISTEEL                                 
18-Jul-01     GOVT         TRAC                              21852-1599                 AMERICAN FIRE TECH                         
18-Jul-01     GOVT         TRAC                              21852-1598                 AMERICAN FIRE TECH                         
18-Jul-01     I/P          BHO                                 1163180                  AMERICAN BLDG MAINTENANCE                  
18-Jul-01     POWER        BHO                                 1161492                  AMENITY RENTALS INC                        


-----------------------------------------------------------------------------------------------------------------------------      
 SALES, USE                                                                                                                        
 AND OTHER                                                                                       CRITICAL                          
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                           
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*        
-----------------------------------------------------------------------------------------------------------------------------      
                                                                                                                                   
                                                                                                       20                 20       
                                                                                                      204                204       
                                                                                                       59                 59       
                              91,555                                                                                  91,555       
                                                                                                    2,698              2,698       
                                 444                                                                                     444       
                                                                                                      661                661       
                                                                                                   17,475             17,475       
                                                                                                      465                465       
                                                                   740                                                   740       
                                  59                                                                    0                 59       
                                                                                                   12,748             12,748       
                                                                                                      648                648       
                                 536                                                                                     536       
                                 274                                                                                     274       
                                 272                                                                                     272       
                                                                                                      263                263       
                                  80                                                                                      80       
                                  74                                                                                      74       
                                                                                                       65                 65       
                                  49                                                                                      49       
                                                                                                       34                 34       
                                                                                                       23                 23       
                                                                                                       20                 20       
                                                                                                       10                 10       
                                   5                                                                                       5       
                                   4                                                                                       4       
                                                                                                        3                  3       
                                                                                                   12,935             12,935       
                                                                                                      130                130       
                                                                                                    5,460              5,460       
                                                                                                      789                789       
                                                                                                    2,547              2,547       
                                 158                                                                                     158       
                                                                                                        6                  6       
                                                                                                    8,916              8,916       
                                                                                                    1,512              1,512       
                                                                                                       51                 51       
                                                                                                   50,353             50,353       
                                                                                                   19,620             19,620       
                                                                                                    1,238              1,238       
                                                                                                    7,512              7,512       


*Negative Entries Indicate Subsequent Reversal of Authorization 

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                        
-----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                             
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                        
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                   
18-Jul-01     I/P          BHO                                 1163179                  AIRGAS EAST                                
18-Jul-01     I/P          BHO                                 1163177                  AEA TECHNOLOGY                             
18-Jul-01     I/P          BHO                                 1163176                  AEA TECHNOLOGY                             
17-Jul-01     GOVT         TRAC                              22553-0488                 WW GRAINGER                                
17-Jul-01     GOVT         TRAC                              22553-0486                 WELSCO                                     
17-Jul-01     I/P          BHO                                 1157102                  UNTIED PARCEL SERVICE                      
17-Jul-01     I&M          BHO                                 3000536                  Toshiba Intl                               
17-Jul-01     P&C          BHO                                 1148200                  TIMBERLINE PLASTICS                        
17-Jul-01     I&M          Pomeroy                            28012376                  Sumitomo                                   
17-Jul-01     I&M          BHO                                47060540                  Stevedoring Services                       
17-Jul-01     I/P          BHO                                 1146251                  SHAMROCK GLASS CO                          
17-Jul-01     POWER        TRAC                                07-147                  Sav's Ironworkers                           
17-Jul-01     I&M          BHO                                47017702                  R and L Communications                     
17-Jul-01     I/P          BHO                                 1162222                  PROFESSIONAL RECORDS MANAGEMENT            
17-Jul-01     POWER        BHO                                 319402                   PETER GRATRIX                              
17-Jul-01     GOVT         TRAC                              22553-0495                 PERDUE COMPANY                             
17-Jul-01     GOVT         TRAC                              22553-0494                 PERDUE COMPANY                             
17-Jul-01     GOVT         TRAC                              22553-0493                 PERDUE COMPANY                             
17-Jul-01     GOVT         TRAC                              22553-0485                 PERDUE COMPANY                             
17-Jul-01     I&M          BHO                                10011962                  Nevada Ready Mix                           
17-Jul-01     I&M          BHO                                47060539                  Justice and Assoc                          
17-Jul-01     GOVT         TRAC                              22553-0491                 IBM PROJECT SUPPORT SERVICES               
17-Jul-01     GOVT         TRAC                              22553-0490                 HUGG & HALL EQUIP. RENT                    
17-Jul-01     POWER        TRAC                                07-145                  Gem Industrial                              
17-Jul-01     POWER        TRAC                                07-148                  Gem Industrial                              
17-Jul-01     I/P          BHO                                 1162305                  ECS ENGINEERING                            
17-Jul-01     I/P          TRAC                                5026592                  Columbia Pipe                              
17-Jul-01     I&M          BHO                                10011961                  Cobre Tire                                 
17-Jul-01     GOVT         TRAC                              22553-0489                 CENTURYTEL                                 
17-Jul-01     I&M          BHO                                 3000538                  Carrasquillo Assoc                         
17-Jul-01     I&M          BHO                                47060538                  BNSF Railroad                              
17-Jul-01     GOVT         TRAC                              22553-0487                 BACKGROUNDS INTERNATIONAL                  
17-Jul-01     CORP         BHO                                 1159263                  AT AND T                                   
17-Jul-01     CORP         BHO                                 1159263                  AT AND T                                   
17-Jul-01     I&M          BHO                                49017701                  Arnold Machinery                           
17-Jul-01     I&M          BHO                                47060537                  All City Tri City Sweeping                 
16-Jul-01     I/P          BHO                                 1162258                  YORK INTERNATIONAL CORP                    
16-Jul-01     GOVT         BHO                                 1162257                  XEROX CORP                                 
16-Jul-01     I/P          BHO                                 1162257                  XEROX CORP                                 
16-Jul-01     I/P          BHO                                 1162255                  WORLDWIDE SECURITY SERVICES LTD            
16-Jul-01     I/P          BHO                                 1162254                  WORK CARE                                  
16-Jul-01     P&C          BHO                                 1162253                  WORDS MAIL SERVICE                         


-----------------------------------------------------------------------------------------------------------------------------      
 SALES, USE                                                                                                                        
 AND OTHER                                                                                       CRITICAL                          
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                           
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*        
-----------------------------------------------------------------------------------------------------------------------------      
                                                                                                                                   
                                                                                                      100                100       
                                                                                                    3,838              3,838       
                                                                                                    2,890              2,890       
                                                                                                      198                198       
                                                                                                    1,381              1,381       
                                                                                                      359                359       
                                                                                                  173,880            173,880       
                                                                                                      880                880       
                                                                                                  186,702            186,702       
                                                                                                      662                662       
                                                                                                      421                421       
                                                                                                   17,102             17,102       
                                                                                                      529                529       
                                                                                                   53,814             53,814       
                                                                   680                                                   680       
                                                                                                    1,175              1,175       
                                                                                                      357                357       
                                                                                                       33                 33       
                                                                                                        3                  3       
                                                                                                    5,108              5,108       
                                                                                                    1,194              1,194       
                                                                                                       54                 54       
                                                                                                    1,577              1,577       
                                                                                                  131,314            131,314       
                                                                                                    2,375              2,375       
                                                                                                    1,690              1,690       
                                                                                                       44                 44       
                                                                                                    4,191              4,191       
                               1,603                                                                                   1,603       
                                                                                                      100                100       
                                                                                                    4,793              4,793       
                                                                                                    3,704              3,704       
                                                                                                      186                186       
                                  18                                                                                      18       
                                                                                                      735                735       
                                                                                                    9,188              9,188       
                                                                                                    2,195              2,195       
                                                                                                    2,057              2,057       
                                                                                                      176                176       
                                                                                                   37,220             37,220       
                                                                                                      370                370       
                                                                                                      396                396       

*Negative Entries Indicate Subsequent Reversal of Authorization 

 Page 9 of 362

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                        
-----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                             
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                        
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                   
16-Jul-01     GOVT         TRAC                              21852-1597                 WISE EL SANTO                              
16-Jul-01     GOVT         TRAC                              21852-1596                 WILLIAMS SCOTSMAN                          
16-Jul-01     I&M          BHO                                20004175                  William Scotsman                           
16-Jul-01     I&M          BHO                                49017645                  Western States                             
16-Jul-01     I&M          BHO                                47060441                  Western Fastners                           
16-Jul-01     GOVT         TRAC                              21852-1595                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1592                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1587                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1586                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1591                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1590                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1589                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1594                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1588                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1585                 WESCO                                      
16-Jul-01     GOVT         TRAC                              21852-1593                 WESCO                                      
16-Jul-01     I/P          BHO                                 1162252                  WASTE MANAGEMENT                           
16-Jul-01     I/P          BHO                                 1162251                  WALSH BROTHERS OFFICE ENVIRONMENTS         
16-Jul-01     I/P          BHO                                 1162250                  VISA ADVISORS INC                          
16-Jul-01     CORP         BHO                                 1162249                  VERIZON                                    
16-Jul-01     I/P          Timberline - 4837                   786746                   US Filter Corp.                            
16-Jul-01     I/P          BHO                                 1162248                  UNISOURCE SOLUTIONS                        
16-Jul-01     CORP         BHO                                 1162247                  TRANSCO                                    
16-Jul-01     I&M          BHO                                49017690                  Tractor and Equipment                      
16-Jul-01     GOVT         TRAC                              21852-1563                 THE PERDUE COMPANY                         
16-Jul-01     GOVT         TRAC                              21852-1562                 THE PERDUE COMPANY                         
16-Jul-01     I/P          BHO                                 1162246                  TELEGROUP INC                              
16-Jul-01     GOVT         TRAC                              21852-1584                 TECHNI-TOOL                                
16-Jul-01     I/P          BHO                                 1162245                  TECHNIQUEX HYDRO SYSTEMS                   
16-Jul-01     I/P          Timberline - 4837                 1043, 1042                 Tarlton Corp.                              
16-Jul-01     I/P          BHO                                 1162244                  TANSEY AND ASSOCIATES INC                  
16-Jul-01     I/P          BHO                               9990007743                 TAKAHASHI PEREZ LOPEZ                      
16-Jul-01     I&M          BHO                                47060446                  Stevedoring Services                       
16-Jul-01     I/P          BHO                                 1162242                  STAVELEY NDT TECHNOLOGIES INC              
16-Jul-01     I/P          BHO                                 1162241                  STAR ELECTRICAL CONTRACTORS INC            
16-Jul-01     POWER        BHO                                 1162311                  SOIL AND MATERIALS ENGINEERS INC           
16-Jul-01     I&M          BHO                                49017691                  SodaSprings Auto Parts                     
16-Jul-01     I/P          BHO                                 1162239                  SKYTEL                                     
16-Jul-01     I/P          BHO                                 1162238                  SIGMA ALDRICH INC                          
16-Jul-01     I/P          BHO                                 1162237                  SHRED IT                                   
16-Jul-01     GOVT         TRAC                              21852-1582                 SHERWIN WILLIAMS                           
16-Jul-01     GOVT         TRAC                              21852-1583                 SHERWIN WILLIAMS                           


-----------------------------------------------------------------------------------------------------------------------------      
 SALES, USE                                                                                                                        
 AND OTHER                                                                                       CRITICAL                          
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                           
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*        
-----------------------------------------------------------------------------------------------------------------------------      
                                                                                                                                   
                                                                                                    8,075              8,075       
                                                                                                    1,018              1,018       
                                                                                                      399                399       
                                                                                                   18,569             18,569       
                                                                                                   12,335             12,335       
                                                                                                    3,149              3,149       
                                                                                                    1,808              1,808       
                                                                                                      953                953       
                                                                                                      826                826       
                                                                                                      335                335       
                                                                                                      314                314       
                                                                                                      286                286       
                                                                                                      281                281       
                                                                                                      174                174       
                                                                                                       82                 82       
                                                                                                       39                 39       
                                                                                                    2,273              2,273       
                                                                                                       98                 98       
                                                                                                      201                201       
                                 695                                                                                     695       
                                                                                                      518                518       
                                                                                                       88                 88       
                                 361                                                                                     361       
                                                                                                       91                 91       
                                                                                                    1,486              1,486       
                                                                                                       43                 43       
                                 283                                                                                     283       
                                                                                                       53                 53       
                                                                                                    4,772              4,772       
                                                                                                   31,071             31,071       
                                                                                                    8,250              8,250       
                                                                                                   18,208             18,208       
                                                                                                    1,583              1,583       
                                                                                                    1,078              1,078       
                                                                                                    2,222              2,222       
                                                                                                   44,750             44,750       
                                                                                                       68                 68       
                                                                                                      194                194       
                                                                                                    2,173              2,173       
                                                                                                       75                 75       
                                                                                                    3,537              3,537       
                                                                                                    1,019              1,019       


 *Negative Entries Indicate Subsequent Reversal of Authorization

Page 10 of 362

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                        
-----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                             
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                        
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                   
16-Jul-01     GOVT         TRAC                              21852-1581                 SHERWIN WILLIAMS                           
16-Jul-01     I/P          BHO                                 1162310                  SHARRON JACKSON                            
16-Jul-01     GOVT         TRAC                              21852-1580                 SCOTT CONSTRUCTION                         
16-Jul-01     I/P          BHO                                 1162235                  SCIENTIFIC EQUIPMENT CO                    
16-Jul-01     GOVT         TRAC                              21852-1575                 RYERSON-TULL                               
16-Jul-01     GOVT         TRAC                              21852-1578                 RYERSON-TULL                               
16-Jul-01     GOVT         TRAC                              21852-1574                 RYERSON-TULL                               
16-Jul-01     GOVT         TRAC                              21852-1573                 RYERSON-TULL                               
16-Jul-01     GOVT         TRAC                              21852-1577                 RYERSON-TULL                               
16-Jul-01     GOVT         TRAC                              21852-1572                 RYERSON-TULL                               
16-Jul-01     GOVT         TRAC                              21852-1579                 RYERSON-TULL                               
16-Jul-01     GOVT         TRAC                              21852-1576                 RYERSON-TULL                               
16-Jul-01     GOVT         TRAC                              21852-1558                 RELIZON                                    
16-Jul-01     GOVT         TRAC                              21852-1570                 RELIZON                                    
16-Jul-01     GOVT         TRAC                              21852-1571                 RELIZON                                    
16-Jul-01     GOVT         TRAC                              21852-1559                 RELIZON                                    
16-Jul-01     I&M          BHO                                47060440                  Reliable Fire Protection                   
16-Jul-01     GOVT         BHO                                 1162228                  QWEST                                      
16-Jul-01     CORP         BHO                                 1162228                  QWEST                                      
16-Jul-01     CORP         BHO                                 1162232                  QWEST                                      
16-Jul-01     POWER        BHO                                 1162228                  QWEST                                      
16-Jul-01     GOVT         BHO                                 1162230                  QWEST                                      
16-Jul-01     CORP         BHO                                 1162231                  QWEST                                      
16-Jul-01     I/P          BHO                                 1162229                  QWEST                                      
16-Jul-01     I/P          BHO                                 1162227                  QUAD CITY TESTING LABORATORY               
16-Jul-01     CORP         BHO                                 1162226                  PSINET CONSULTING SOLUTIONS                
16-Jul-01     I/P          BHO                                 1162225                  PSI                                        
16-Jul-01     I/P          BHO                                 1162223                  PROFESSIONAL WELDING                       
16-Jul-01     GOVT         TRAC                              21852-1567                 PLASITE                                    
16-Jul-01     GOVT         TRAC                              21852-1564                 PINE BLUFF SAND & GRAVEL                   
16-Jul-01     GOVT         TRAC                              21852-1566                 PINE BLUFF SAND & GRAVEL                   
16-Jul-01     GOVT         TRAC                              21852-1565                 PINE BLUFF SAND & GRAVEL                   
16-Jul-01     I/P          BHO                                 1162221                  PHILIP ANALYTICAL SERVICES                 
16-Jul-01     I&M          San Roque                            2364                    Phil Long Distance Telegraphic Co          
16-Jul-01     GOVT         TRAC                              21852-1561                 PERDUE                                     
16-Jul-01     GOVT         BHO                                 1162220                  PENN RECORDS MANAGEMENT                    
16-Jul-01     GOVT         BHO                                 1162219                  PC WORKS                                   
16-Jul-01     I/P          BHO                                 1162218                  PARADISE DRINKING WATER                    
16-Jul-01     I&M          BHO                                10011936                  Pan Western                                
16-Jul-01     GOVT         BHO                                 1162217                  PACIFIC BELL                               
16-Jul-01     I/P          Timberline - 4837       SVC-51582, SVC-51771, SVC-51577      Overhead Door Company                      
16-Jul-01     POWER        BHO                                 1162215                  OCKMAN AND BORDEN ASSOCIATES               


-----------------------------------------------------------------------------------------------------------------------------      
 SALES, USE                                                                                                                        
 AND OTHER                                                                                       CRITICAL                          
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                           
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*        
-----------------------------------------------------------------------------------------------------------------------------      
                                                                                                                                   
                                                                                                       90                 90       
                                                                                                       47                 47       
                                                                                                      657                657       
                                                                                                    1,299              1,299       
                                                                                                    2,086              2,086       
                                                                                                    1,597              1,597       
                                                                                                      756                756       
                                                                                                      339                339       
                                                                                                      313                313       
                                                                                                      148                148       
                                                                                                      126                126       
                                                                                                     (139)              (139)      
                                                                                                      314                314       
                                                                                                      250                250       
                                                                                                       22                 22       
                                                                                                     (225)              (225)      
                                                                                                      423                423       
                               1,027                                                                                   1,027       
                                                                                                      833                833       
                                                                                                      407                407       
                                                                                                       62                 62       
                                                                                                       59                 59       
                                                                                                       24                 24       
                                                                                                       15                 15       
                                                                                                      855                855       
                                                                                                    4,552              4,552       
                                                                                                    7,400              7,400       
                                                                                                       81                 81       
                                                                                                      547                547       
                                                                                                   22,002             22,002       
                                                                                                   14,713             14,713       
                                                                                                      272                272       
                                                                                                       64                 64       
                               5,535                                                                                   5,535       
                                                                                                       46                 46       
                                                                                                      137                137       
                                 628                                                                                     628       
                                  18                                                                                      18       
                                                                                 3,900                                 3,900       
                                 426                                                                                     426       
                                                                                                      825                825       
                                                                                                   11,874             11,874       


 *Negative Entries Indicate Subsequent Reversal of Authorization

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                        
-----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                             
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                        
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                   
16-Jul-01     I&M          BHO                                47060445                  NC Machinery Co                            
16-Jul-01     I/P          BHO                                 1162214                  NATIONAL TRAILER STORAGE                   
16-Jul-01     I/P          Timberline - 4837                    2452                    Murphy                                     
16-Jul-01     GOVT         BHO                                 1162213                  MSE TECHNOLOGY APPLICATIONS                
16-Jul-01     GOVT         TRAC                              21852-1560                 MORGAN BUILDINGS & SPAS, INC.              
16-Jul-01     I&M          San Roque                          10000162                  Monark Equipment Corporation               
16-Jul-01     I&M          BHO                                47060504                  Mladen bunch                               
16-Jul-01     P&C          TRAC                                1511118                  Mitsubishi                                 
16-Jul-01     I/P          Timberline - 4837                    2517                    Missouri Safety Council                    
16-Jul-01     I&M          San Roque                            2362                    Mespar Gen Merchandising                   
16-Jul-01     GOVT         TRAC                              21852-1559                 MCMASTER-CARR                              
16-Jul-01     GOVT         TRAC                              21852-1558                 MCMASTER-CARR                              
16-Jul-01     I/P          BHO                                 1162212                  MCMASTER CARR SUPPLY CO                    
16-Jul-01     GOVT         TRAC                              21852-1557                 MCJUNKIN                                   
16-Jul-01     I&M          San Roque                            2363                    MBT Philippines Inc                        
16-Jul-01     I&M          BHO                                47060444                  Masons Supply Co                           
16-Jul-01     GOVT         TRAC                              21848-0372                 MARK STEEL CORP.                           
16-Jul-01     I/P          BHO                                 1162211                  MAJOR PARTITIONS                           
16-Jul-01     I/P          Timberline - 4837                  27731-IN                  M&M Golf Cars, LLC                         
16-Jul-01     GOVT         TRAC                              21852-1556                 LIBERTY SUPPLY                             
16-Jul-01     I/P          BHO                                 1162209                  LABTECH                                    
16-Jul-01     I/P          Timberline - 17478               2853-7/18/01                Kramer Gehlen Associates                   
16-Jul-01     I/P          BHO                                 1162208                  KNOWLEDGEWIRE                              
16-Jul-01     I/P          BHO                                 1162207                  KEEN COMPRESSED GAS                        
16-Jul-01     I/P          BHO                                 1162206                  KANSAS STATE UNIVERSITY                    
16-Jul-01     I&M          BHO                                47060443                  JLA Enterprises                            
16-Jul-01     POWER        BHO                                 1162205                  IRON MOUNTAIN                              
16-Jul-01     POWER        BHO                                 1162204                  INTERGRAPH CORP                            
16-Jul-01     I/P          BHO                                 1162204                  INTERGRAPH CORP                            
16-Jul-01     POWER        BHO                                 1162203                  INTERGRAPH CORP                            
16-Jul-01     I/P          BHO                                 1162308                  INTERGRAPH CORP                            
16-Jul-01     P&C          BHO                                 1162309                  INTERGRAPH CORP                            
16-Jul-01     P&C          BHO                                 1162308                  INTERGRAPH CORP                            
16-Jul-01     I&M          San Roque                            2361                    Integrated Waste Management                
16-Jul-01     I&M          BHO                                47060439                  Ingersoll Rand                             
16-Jul-01     I/P          BHO                                 1162202                  HUNT CORP                                  
16-Jul-01     I/P          BHO                                 1162201                  HOME PARAMOUNT                             
16-Jul-01     I&M          BHO                                47060438                  HCPI                                       
16-Jul-01     I&M          BHO                                47060442                  HCPI                                       
16-Jul-01     I/P          Timberline - 4837                    15830                   Hartman-Walsh Painting Co.                 
16-Jul-01     I/P          Timberline - 4505              01-0424, 01-0856              Harder Mechanical Contractors, IN          
16-Jul-01     I/P          BHO                                 1162200                  H A C S C INC                              


-----------------------------------------------------------------------------------------------------------------------------      
 SALES, USE                                                                                                                        
 AND OTHER                                                                                       CRITICAL                          
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                           
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*        
-----------------------------------------------------------------------------------------------------------------------------      
                                                                                                                                   
                                                                                                      251                251       
                                                                                                      101                101       
                                                                                                    6,521              6,521       
                                                                                                       73                 73       
                                                                                                      666                666       
                                                                24,964                                                24,964       
                                                                                                   32,555             32,555       
                                                                                                  605,027            605,027       
                                                                                                      245                245       
                                                                   646                                                   646       
                                                                                                      857                857       
                                                                                                      808                808       
                                                                                                      256                256       
                                                                                                      197                197       
                                                                   439                                                   439       
                                                                                                      155                155       
                                                                                                  193,940            193,940       
                                                                                                   57,735             57,735       
                                                                                                      211                211       
                                                                                                      519                519       
                                                                                                    1,500              1,500       
                                                                                                      420                420       
                                                                                                    7,500              7,500       
                                                                                                      375                375       
                                                                                                      628                628       
                                                                                                    6,820              6,820       
                                                                                                   11,583             11,583       
                                                                                                    7,352              7,352       
                               7,031                                                                                   7,031       
                                                                                                    4,800              4,800       
                               2,578                                                                                   2,578       
                                                                                                      896                896       
                                                                                                      857                857       
                                                                   116                                                   116       
                                                                                                      298                298       
                                                                                                      202                202       
                                                                                                      170                170       
                                                                                                    3,621              3,621       
                                                                                                    3,309              3,309       
                                                                                                      552                552       
                                                                                                   15,001             15,001       
                                                                                                      240                240       


 *Negative Entries Indicate Subsequent Reversal of Authorization

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                        
-----------------------------------------------------------------------------------------------------------------------------------

                          DISBURSEMENT                                                                                             
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                        
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                   
16-Jul-01     I/P          Timberline - 4837   5488, 5489, 5490, 5491, 5492, 5493, 5494,     Grossmann Contracting                 
                                               5495,5551                                                                           
16-Jul-01     GOVT         TRAC                              21852-1555                      GRAYBAR ELECTRIC                      
16-Jul-01     GOVT         BHO                                 1162199                       FABICK TRACTOR CO                     
16-Jul-01     GOVT         TRAC                              21852-1554                      F&M MAFCO                             
16-Jul-01     I/P          BHO                                 1162307                       ENTERPRISE RENT-A-CAR                 
16-Jul-01     I/P          Timberline - 14330               1363-7/16/01                     Electro-test, Inc.                    
16-Jul-01     I/P          BHO                                 1162306                       ELECTRONIC COMMUNICATION              
16-Jul-01     I/P          BHO                                 1162198                       ECS ENGINEERING                       
16-Jul-01     I/P          BHO                                 1162197                       DURATEK                               
16-Jul-01     GOVT         TRAC                              21852-1553                      DRAGO                                 
16-Jul-01     GOVT         TRAC                              21852-1552                      DOUTHIT'S RADIO SERVICE INC.          
16-Jul-01     GOVT         TRAC                              21852-1551                      DOUTHIT'S RADIO SERVICE INC.          
16-Jul-01     I/P          BHO                                 1162196                       D GEORGE CHADWICK JR                  
16-Jul-01     I/P          BHO                                 1162195                       CONTRACTORS SAFETY COUNCIL OF TEXAS   
16-Jul-01     GOVT         TRAC                              21852-1548                      CONSOLIDATED ELECTRICAL DIST.         
16-Jul-01     I/P          BHO                                 1162194                       CONCENTRA MEDICAL CENTERS             
16-Jul-01     I/P          BHO                                 1162193                       COMPCO ANALYTICAL INC                 
16-Jul-01     I/P          BHO                                 1162192                       CLOHESSY HARRIS AND KAISER LLC        
16-Jul-01     I/P          BHO                                 1162191                       CLEMSON UNIVERSITY                    
16-Jul-01     I&M          San Roque                            2360                         Civic Merchandising Inc               
16-Jul-01     I/P          Timberline - 4837                  452423969                      Cintas Corp. - 731                    
16-Jul-01     I/P          BHO                                 1162189                       CINGULAR WIRELESS                     
16-Jul-01     CORP         BHO                                 1162190                       CINGULAR WIRELESS                     
16-Jul-01     GOVT         TRAC                              21852-1547                      CARBOLINE                             
16-Jul-01     GOVT         TRAC                              21852-1546                      CARBOLINE                             
16-Jul-01     I/P          BHO                                 1162188                       CANON                                 
16-Jul-01     GOVT         TRAC                              21852-1550                      C&W TOOL                              
16-Jul-01     GOVT         TRAC                              21852-1549                      C&W TOOL                              
16-Jul-01     VARIOUS      BHO                                 1162304                       BOISE CASCADE OFFICE PRODUCTS         
16-Jul-01     I/P          BHO                                 1162303                       BLASLAND BOUCK AND LEE INC            
16-Jul-01     CORP         BHO                                 1162302                       BGE                                   
16-Jul-01     POWER        BHO                                 1162187                       BERNARD HODES ADVERTISING             
16-Jul-01     CORP         BHO                                 1162552                       BELLSOUTH COMMUNICATIONS SYSTEMS      
16-Jul-01     GOVT         BHO                                 1162186                       BAILEYS MOVING AND STORAGE            
16-Jul-01     POWER        BHO                                 1162301                       AUTOMATED ENGINEERING SERVICES CORP   
16-Jul-01     I/P          BHO                                 1162185                       AUTO RENTAL CORP                      
16-Jul-01     GOVT         BHO                                 1162300                       AUGUST BUILDING MAINTENANCE           
16-Jul-01     I/P          BHO                                 1162182                       AT AND T                              
16-Jul-01     I/P          BHO                                 1162184                       AT AND T                              
16-Jul-01     CORP         BHO                                 1162299                       AT AND T                              
16-Jul-01     CORP         BHO                                 1162183                       AT AND T                              
16-Jul-01     I&M          BHO                                47060503                       AT & T                                


-----------------------------------------------------------------------------------------------------------------------------      
 SALES, USE                                                                                                                        
 AND OTHER                                                                                       CRITICAL                          
 TRUST FUND                                  MECHANICS        FOREIGN                              TRADE                           
    TAXES                      UTILITIES        LIENS          VENDOR             SHIPPING         VENDOR            TOTAL*        
-----------------------------------------------------------------------------------------------------------------------------      
                                                                                                                                   
                                                                                                   15,066             15,066       
                                                                                                    1,804              1,804       
                                                                                                   13,738             13,738       
                                                                                                    1,657              1,657       
                                                                                                      167                167       
                                                                                                    2,103              2,103       
                                                                                                      200                200       
                                                                                                      520                520       
                                                                                                      840                840       
                                                                                                      267                267       
                                                                                                    2,626              2,626       
                                                                                                      464                464       
                                                                                                    1,268              1,268       
                                                                                                       85                 85       
                                                                                                    1,749              1,749       
                                                                                                       30                 30       
                                                                                                    2,544              2,544       
                                                                                                    3,324              3,324       
                                                                                                  120,917            120,917       
                                                                    46                                                    46       
                                                                                                      186                186       
                                                                                                      206                206       
                                                                                                       44                 44       
                                                                                                    7,155              7,155       
                                                                                                    5,368              5,368       
                                                                                                      535                535       
                                                                                                       91                 91       
                                                                                                       48                 48       
                                                                                                      505                505       
                                                                                                   11,760             11,760       
                                                                                                        5                  5       
                                                                                                      275                275       
                               2,329                                                                                   2,329       
                                                                                                      335                335       
                                                                                                   14,967             14,967       
                                  19                                                                                      19       
                                                                                                      314                314       
                                                                                                      330                330       
                                                                                                       99                 99       
                                                                                                       69                 69       
                                                                                                       17                 17       
                                  77                                                                                      77       


 *Negative Entries Indicate Subsequent Reversal of Authorization

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                     WASHINGTON GROUP INTERNATIONAL, INC. / PRE-PETITION PAYMENTS AUTHORIZED BY COURT ORDER                        
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                          DISBURSEMENT                                                                                             
  DATE       GROUP        LOCATION                         CONTROL NUMBER                            VENDOR                        
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