<PAGE>
 
                                                                    EXHIBIT 10.2
                                        
                          BATCHELDER & PARTNERS, INC.
                    4330 La Jolla Village Drive, Suite 200
                          San Diego, California 92122


David H. Batchelder                                   Telephone:  (619) 456-6655
Chairman and Chief Executive Officer                  Telecopier: (619) 456-7969


                                 April 6, 1998


Mr. Robert A. Tinstman
President and Chief Executive Officer
Morrison Knudsen Corporation
Morrison Knudsen Plaza
720 Park Boulevard
Boise, Idaho  83712

Dear Bob:

     This is to confirm our understanding that Morrison Knudsen Corporation, its
successors and/or assignees (the "Company") has retained Batchelder & Partners,
Inc. ("B&P") as its non-exclusive financial advisor with respect to transactions
that the Company may pursue with CBS Corporation ("CBS"), including the merger,
consolidation, combination, reorganization, recapitalization or acquisition of
all or a portion of the stock or assets of CBS Corporation divisions known to
you and us as Government and Environmental Services Company ("GESCO"), and
Energy Systems ("Energy Systems") (individually or collectively a
"Transaction").  "You," as used herein, shall refer to the Company.

     In connection with our engagement hereunder and all other engagements
involving the Company and in effect during calendar year 1998, the Company shall
pay B&P an aggregate retainer fee of $50,000 per month, payable in cash on the
first business day of each month commencing April 1, 1998.  Provided, however,
that the maximum monthly, and aggregate retainer fee payable to B&P pursuant to
this agreement and pursuant to all other fee arrangements in effect during
calendar year 1998 between the Company and B&P shall not exceed $50,000, and
$250,000, respectively, for the twelve months ended December 31, 1998.  Provided
further that any retainer fee paid to B&P hereunder shall be creditable against
any Success Fee (as hereinafter defined) paid to B&P pursuant to this agreement
or pursuant to any other agreement entered into during 1998 between B&P and the
Company.

     Further, if any Transaction or series of Transactions is consummated by You
and/or any entity substantially owned by You or any partnership, limited
liability company, affiliate or joint venture of which You are a member (singly
or collectively, "Acquirer"), the Company agrees to pay B&P a fee (the "Success
Fee") equal to 0.6 percent (.006) of the MK Transaction Value.  "MK
<PAGE>
 
Mr. Robert Tinstman                    -2-                        April 6, 1998



Transaction Value" shall mean the aggregate Value (as hereinafter defined) of
all cash, non-cash assets, equity and debt issued or assumed in connection with
a Transaction and shall include the Value of equity and debt securities of any
entity created as part of a process to effect a Transaction.  "Value" shall mean
(i) with respect to cash, the amount thereof provided by You or accruing to the
Company's economic interest in Acquirer; (ii) with respect to marketable
securities contributed by You or accruing to the Company's economic interest in
Acquirer, the mean of the average of the bid and ask of such securities as
quoted at the close on their principal trading market on the tenth through the
sixth consecutive trading days ending on the trading day preceding the date of
closing of the Transaction or, if not quoted on such dates, the mean of the
average of the bid and ask of such  securities as quoted at the close on their
principal trading market on the five (5) consecutive trading days beginning with
the next such trading day on which a bid/ask is so quoted; and (iii) with
respect to non-cash consideration other than marketable securities, the fair
market value thereof relevant to the Company's economic interest in Acquirer as
mutually agreed by the Company and B&P.  Any fee pursuant to this paragraph
shall be payable in cash upon closing or consummation of such Transaction or, in
the event that the determination of Value requires market information only
available after such closing, as soon as practicable thereafter but in no event
later than fifteen (15) days after closing or consummation of such Transaction.
In the event that a Transaction is not consummated and the Company receives a
break fee or similar compensation (a "Break Fee"), the Company shall pay to B&P
ten (10) percent of such Break Fee.

     In addition to the foregoing compensation, You shall reimburse B&P for our
reasonable out-of-pocket expenses, which shall include the fees and
disbursements of our counsel.  We shall not incur expenses in excess of $25,000
without your approval, which shall not be unreasonably withheld.

     Since we will be acting on the Company's behalf, the Company is agreeing to
provide us with indemnification pursuant to the letter dated April 1, 1998 from
the Company to B&P.  Further, nothing in this engagement is intended to create
an agency or other fiduciary relationship between the parties or any of their
affiliates, directors, officers, partners, agents or employees.  The sole
obligation of B&P hereunder shall be the contractual obligations specifically
created by this agreement.

     Our services hereunder may be terminated by the Company or by B&P upon
written notice and, in any event, shall terminate on March 31, 1999.  If the
Company elects to terminate, no further retainer amounts shall accrue, any due
but unpaid retainer amounts and fees shall be paid and any reimbursable expenses
incurred before the date of termination shall be paid.  Provided, however,
<PAGE>
 
Mr. Robert Tinstman                     -3-                       April 6, 1998


you specifically acknowledge that our services hereunder will have continuing
value to the Company and therefore You agree that if You terminate our services
and within 12 months thereafter, an Acquirer effects a Transaction, then B&P
shall be entitled to compensation pursuant to the third paragraph hereof to the
same extent as if our services had not been terminated.  If B&P elects to
terminate, no further retainer amounts shall accrue, any due but unpaid retainer
amounts and fees shall be paid and any reimbursable expenses incurred before the
date of termination shall be paid.  Notwithstanding the foregoing, the
provisions of the preceding paragraph shall survive any termination, whether by
the Company, or by B&P, as a result of the passage of time or otherwise.

     Except as required by law, any advise (written or oral) rendered by us
pursuant to this letter ay not be disclosed publicly without our prior written
consent, which consent shall not be unreasonably withheld.

     Please confirm that the foregoing is in accordance with the Company's
understanding by signing and returning the duplicate of this letter attached
hereto, which shall thereupon constitute a binding agreement.

                              Very truly yours,

                              BATCHELDER & PARTNERS, INC.


                              By:  /s/ David H. Batchelder
                                   -----------------------------------
                                   Chairman and CEO


Confirmed:

MORRISON KNUDSEN CORPORATION


By:  /s/ Stephen G. Hanks
     ---------------------------

Printed Name:  Stephen G. Hanks
               -----------------

Title:  Exec. Vice President
        ------------------------

Date:      Oct. 6, 1998
       -------------------------
<PAGE>
 
                                 April 1, 1998



Batchelder & Partners, Inc.
4330 La Jolla Village Drive, Suite 200
San Diego, California   92122


Gentlemen:

     In connection with your engagement as financial advisor to Morrison Knudsen
Corporation, its successors and/or assignees (the "Undersigned") with respect to
the matters contemplated by the letter from you to the Undersigned of even date
herewith, the Undersigned hereby agrees to indemnify and hold harmless you and
your affiliates, the respective directors, officers, partners, agents, and
employees of you and your affiliates and each other person, if any, controlling
you or any of your affiliates, to the full extent lawful, from and against all
losses, claims, damages, liabilities and expenses incurred by you and such other
persons (including reasonable fees and disbursements of counsel) which (A) are
related to or arise out of (i) actions taken or omitted to be taken (including
any untrue statements made or any statements omitted to be made) by the
Undersigned, its associates or affiliates or (ii) actions taken or omitted to be
taken by an indemnified person with the consent of the Undersigned, its
associates or affiliates or in conformity with their actions or omissions or (B)
are otherwise related to or arise out of your activities on behalf of the
Undersigned, its associates or affiliates under your engagement, and the
Undersigned will reimburse you and any other person indemnified hereunder for
all expenses (including reasonable fees and disbursements of counsel) as they
are incurred by you or such other indemnified person in connection with
investigating, preparing or defending any such action or claim, whether or not
in connection with pending or threatened litigation in which you or any other
indemnified person is a party.  The Undersigned will not be responsible,
however, for any losses, claims, damages, liabilities or expenses pursuant to
clause (B) of the preceding sentence which are finally judicially determined to
have resulted primarily from the willful misconduct, bad faith or gross
negligence of the person seeking indemnification hereunder (although it is
expressly intended that the Undersigned will be responsible for any thereof that
result from the negligence, other than gross negligence, of such person).  The
Undersigned also agrees that neither you, nor any of your affiliates, nor any
director, officer, partner, agent or employee of you or any of your affiliates,
nor any person controlling you or any of your affiliates, shall have any
liability to the Undersigned for or in connection with such engagement except
for such liability for losses, claims, damages, liabilities or expenses incurred
by the Undersigned which is finally judicially determined to have resulted
primarily from your willful misconduct, bad faith or gross negligence as herein
described.  The foregoing agreement shall be in addition to any rights that you
or any indemnified person may have at common law or otherwise, including, but
not limited to, any right to contribution.
<PAGE>
 
Batchelder & Partners, Inc.            -2-                       April 1, 1998



     It is understood that, in connection with your engagement, you may also be
engaged to act for the Undersigned, its associates or affiliates in one or more
additional capacities, and that the terms of the original engagement or any such
additional engagement may be embodied in one or more separate written
agreements.  This indemnification shall apply to the original engagement, any
such additional engagement and any modification of the original engagement or
such additional engagement in connection with which this letter is expressly
referenced in writing and shall remain in full force and effect following the
completion or termination of such engagement(s).


                         Very truly yours,

                         MORRISON KNUDSEN CORPORATION


                         /s/Stephen G. Hanks
                         -----------------------------------


Accepted:

BATCHELDER & PARTNERS, INC.


By:  /s/ David H. Batchelder
     ----------------------------

Title:  
      ---------------------------

Date:
      ---------------------------