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UNITED STATES
 SECURITIES AND EXCHANGE
    COMMISSION
 Washington, D.C.
    20549
      FORM 10-K
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934For the fiscal year ended December 28, 2007ORo

TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period from ............ to .............   001-31305
  FOSTER WHEELER LTD.
 (Exact name of registrant as
    specified in its charter)
  BERMUDA(State or other jurisdiction of
    incorporation or organization)

22-3802649(I.R.S. Employer Identification
    No).Perryville Corporate Park, Clinton, New Jersey(Address of Principal Executive
    Offices)

08809-4000(Zip Code)    (908) 730-4000
     (Title of Each Class)

(Name of Each Exchange on which Registered)Foster Wheeler Ltd.,
    Common Shares, $0.01 par value

NASDAQ Stock Market LLCFoster Wheeler Ltd.,
    Class A Common Share Purchase Warrants

NASDAQ Stock Market LLC      (Title of Each Class)

(Name of Each Exchange on which Registered)Foster Wheeler Ltd.,
    Series B Convertible Preferred Shares, $0.01 par
    value

Over-the-Counter Bulletin Board   þ o
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  Large accelerated
    filer þ

Accelerated
    filer o

Non-accelerated
    filer o
    (Do not check if a smaller reporting company)

Smaller reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE:




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##### 





FOSTER
    WHEELER LTD.
  INDEX
   
 ITEM



PagePART I1.

Business


21A.

Risk Factors


71B.

Unresolved Staff Comments


162.

Properties


173.

Legal Proceedings


194.

Submission of Matters to a Vote of Security
    Holders


19PART II5.

Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


206.

Selected Financial Data


227.

Managements Discussion and Analysis of
    Financial Condition and Results of Operations


247A.

Quantitative and Qualitative Disclosures about
    Market Risk


568.

Financial Statements and Supplementary Data


589.

Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


1229A.

Controls and Procedures


1229B.

Other Information


122PART III10.

Directors, Executive Officers and Corporate
    Governance


12311.

Executive Compensation


12312.

Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


12313.

Certain Relationships and Related Transactions,
    and Director Independence


12514.

Principal Accountant Fees and Services


125PART IV15.

Exhibits and Financial Statement Schedules


126EX-3.5: MEMORANDUM OF INCREASE OF SHARE CAPITALEX-21.0: SUBSIDIARIESEX-23.0: CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATIONEX-32.2: CERTIFICATION    Form 10-K Form 10-K.
 1




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PART I ITEM 1. BUSINESS  General
    Business
  Global
    Engineering and Construction Group Global Power Group
  gas-to-liquids
  coal-to-liquids
  waste-to-energy
  2
  2 2 2
 2




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waste-to-energy
    Form 10-K
  Products
    and Services
    
    Consulting Our Global E&C Group provides
    technical and economic analyses and study reports to owners,
    investors, developers, operators and governments. These services
    include concept and feasibility studies, market studies, asset
    assessments, product demand and supply modeling, and technology
    evaluations.
    Design and Engineering Our Global E&C
    Group provides a broad range of engineering and design-related
    services. Our design and engineering capabilities include
    process, civil, structural, architectural, mechanical,
    instrumentation, electrical, and health, safety and
    environmental management. For each project, we identify the
    project requirements and then integrate and coordinate the
    various design elements. Other critical tasks in the design
    process may include value engineering to optimize costs, risk
    and hazard reviews, and the assessment of construction,
    maintenance and operational requirements.
    Project Management and Project Control Our
    Global E&C Group offers a wide range of project management
    and project control services for overseeing engineering,
    procurement and construction activities. These services include
    estimating costs, project planning and project cost control. The
    provision of these services is an integral part of the planning,
    design and construction phases of projects that we execute
    directly for clients. We also provide these services to our
    clients in the role of project management or program management
    consultant, where we oversee, on our clients behalf, the
    execution by other contractors of all or some of the planning,
    design and construction phases of a project.
    Procurement Our procurement activities focus
    on those projects where we also execute the design and
    engineering work. We manage the procurement of materials,
    subcontractors and craft labor. Often, we purchase materials,
    equipment or services on behalf of our client, where the client
    will pay for the materials at cost and reimburse us the cost of
    our services plus a margin or fee.
    Construction/Commissioning and
    Start-up Our Global E&C Group provides construction and
    construction management services on a worldwide basis. Our
    construction, commissioning and
    start-up
    activities focus on those projects where we have performed most
    of the associated design and engineering work. Depending on the
    project, we may function as the primary contractor or as a
    subcontractor to another firm. On some projects, we function as
    the construction manager, engaged by the customer to oversee
    another contractors compliance with design specifications
    and contracting 3




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terms. In some instances, we have responsibility for
    commissioning and plant
    start-up,
    or, where the client has responsibility for these activities, we
    provide experts to work as part of our clients team.  
    Operations and Maintenance We provide project
    management, plant operations and maintenance services, such as
    repair, renovation, predictive and preventative services and
    other aftermarket services. In some instances, our contracts may
    require us to operate a plant, which we have designed and built,
    for an initial period that may vary from a very short period to
    up to approximately two years.  sub-critical
  
    Circulating Fluidized-Bed Boilers Our Global
    Power Group designs, manufactures and supplies boilers that
    utilize proprietary CFB technology. We believe that CFB
    combustion is generally recognized as one of the most efficient,
    environmentally friendly and versatile ways to generate steam
    from coal and many other solid fuels and waste products with
    reduced environmental pollutants. A CFB boiler utilizes air jets
    at the base of the boiler to blow the fuel particles as they
    burn, resulting in a very efficient combustion and heat transfer
    process. The fuel and other added solid materials, such as
    limestone, are continuously recycled through the furnace to
    maximize combustion efficiency and capture pollutants, such as
    the oxides of sulfur, which we refer to as SOx. Due to the
    efficient mixing of the fuel with the air and other solid
    materials and the long period of time the fuel remains in the
    combustion process, the temperature of the process can be
    greatly reduced below that of a conventional burning process.
    This has the added benefit of reducing the formation of NOx,
    which is another pollutant formed in the combustion process. Due
    to these benefits, additional SOx and NOx control systems are
    frequently not needed. The application of supercritical steam
    technology to CFB technology is the latest technical
    development. By dramatically raising the pressure of the water
    as it is converted to steam, supercritical steam technology
    allows the steam to absorb more heat from the combustion
    process, resulting in a substantial improvement of approximately
    5-10% in the efficiency of an electric power plant. We sell our
    CFB boilers to clients worldwide.
    Pulverized Coal Boilers Our Global Power
    Group designs, manufactures and supplies PC boilers. PC boilers
    are commonly used in large electric coal-fired power plant
    applications. The coal is pulverized into fine particles and
    injected through specially designed low emission burners. Our PC
    boilers control NOx by utilizing advanced low-NOx combustion
    technology and selective catalytic reduction technology, which
    we refer to as SCR. PC technology requires pollution control
    equipment to be installed along with the boiler to capture SOx.
    We offer our PC boilers with either conventional
    sub-critical
    steam technology or more efficient supercritical steam
    technology for electric power plant applications. We sell our PC
    boilers to clients worldwide.
    Auxiliary Equipment and Aftermarket Services Our Global Power Group also manufactures and installs
    integral components for natural gas, oil and solid fuel-fired
    power generation facilities, including surface condensers,
    feedwater heaters, coal pulverizers and NOx reduction systems.
    The NOx reduction systems include selective catalytic reduction,
    or SCR, equipment and low NOx combustion systems, and can
    significantly reduce NOx emissions. These products can be used
    with a wide range of boilers. Our Global Power Group also
    supplies replacement components, repair parts, boiler
    modifications and engineered solutions for boilers worldwide.   4




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Industries
    We Serve
    
    Oil and gas;
    Oil refining;
    Chemical/petrochemical;
    Pharmaceutical;
    Environmental;
    Power generation; and
    Power plant operation and maintenance.  Customers
    and Marketing
    Licenses,
    Patents and Trademarks
    Unfilled
    Orders
     5




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Use of
    Raw Materials
    Compliance
    with Government Regulations
    Employees
    As ofDecember 28,


December 29,2007


2006Global E&C Group


10,498



8,887Global Power Group


3,278



3,027C&F Group


83



7813,859



11,992   Competition
    Available
    Information
  Form 10-K, Form 10-Q, Form 8-K, www.fwc.com Form 10-K.
  1-800-SEC-0330. www.sec.gov
 6




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ITEM 1A. RISK
    FACTORS (amounts in thousands of dollars)  Form 10-K.
    Risks
    Related to Our Operations
  Our
    current and future lump-sum or fixed-price contracts and other
    shared risk contracts may result in significant losses if costs
    are greater than anticipated.
      
    engineering design changes;
    unanticipated technical problems with the equipment being
    supplied or developed by us, which may require that we spend our
    own money to remedy the problem;
    changes in the costs of components, materials or labor;
    difficulties in obtaining required governmental permits or
    approvals;
    changes in local laws and regulations;
    changes in local labor conditions;
    project modifications creating unanticipated costs;
    delays caused by local weather conditions; and
    our project owners, suppliers or
    subcontractors failure to perform.  agreed-upon
 7




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and/or
  percentage-of-completion Form 10-K.
  Failure
    by us to successfully defend against claims made against us by
    project owners, suppliers or project subcontractors, or failure
    by us to recover adequately on claims made against project
    owners, suppliers or subcontractors, could materially adversely
    affect our business, financial condition, results of operations
    and cash flows.
  and/or Form 10-K.
  Projects
    included in our backlog may be delayed or canceled, which could
    materially adversely affect our business, financial condition,
    results of operations and cash flows.
    Because
    our operations are concentrated in four particular industries,
    we may be adversely impacted by economic or other developments
    in these industries.
   8




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sub-prime
  We may
    lose business to competitors.
  and/or
  A
    failure by us to attract and retain qualified personnel, joint
    venture partners, advisors and subcontractors could materially
    adversely affect our business, financial condition, results of
    operations and cash flows.
    Our
    worldwide operations involve risks that may limit or disrupt
    operations, limit repatriation of cash, increase foreign
    taxation or otherwise materially adversely affect our business,
    financial condition, results of operations and cash
    flows.
  non-U.S. subsidiaries,
  
    uncertain political, legal and economic environments;
    potential incompatibility with foreign joint venture partners;
    foreign currency controls and fluctuations;
    energy prices and availability;
    terrorist attacks;
    the imposition of additional governmental controls and
    regulations;
    war and civil disturbances;
    labor problems; and
    interruption or delays in international shipping.   9




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Our
    business may be materially adversely impacted by regional,
    national and/or global requirements to significantly limit or
    reduce greenhouse gas emissions in the future.
  and/or and/or
  We are
    subject to various environmental laws and regulations in the
    countries in which we operate. If we fail to comply with these
    laws and regulations, we may incur significant costs and
    penalties that could materially adversely affect our business,
    financial condition, results of operations and cash
    flows.
   10




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We may
    lose future business to our competitors and be unable to operate
    our business profitably if our patents and other intellectual
    property rights do not adequately protect our proprietary
    products.
    We
    rely on our information systems in our operations. Failure to
    protect these systems against security breaches could adversely
    affect our business and results of operations. Additionally, if
    these systems fail or become unavailable for any significant
    period of time, our business could be harmed.
    Risks
    Related to Asbestos Claims
  The
    number and cost of our current and future asbestos claims in the
    United States could be substantially higher than we have
    estimated and the timing of payment of claims could be sooner
    than we have estimated, which could materially adversely affect
    our business, financial condition, results of operations and
    cash flows.
  out-of-court and/or
  
    the rate at which new claims are filed;
    the number of new claimants;
    changes in the mix of diseases alleged to be suffered by the
    claimants, such as type of cancer, asbestosis or other illness;
    increases in legal fees or other defense costs associated with
    asbestos claims;
    increases in indemnity payments; 11




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
    decreases in the proportion of claims dismissed with zero
    indemnity payments;
    indemnity payments being required to be made sooner than
    expected;
    bankruptcies of other asbestos defendants, causing a reduction
    in the number of available solvent defendants and thereby
    increasing the number of claims and the size of demands against
    our subsidiaries;
    adverse jury verdicts requiring us to pay damages in amounts
    greater than we expect to pay in settlements;
    changes in legislative or judicial standards that make
    successful defense of claims against our subsidiaries more
    difficult; or
    enactment of federal legislation requiring us to contribute
    amounts to a national settlement trust in excess of our expected
    net liability, after insurance, in the tort system.    15-year
      The
    adequacy and timing of insurance recoveries of our
    asbestos-related costs in the United States is uncertain. The
    failure to obtain insurance recoveries could materially
    adversely affect our business, financial condition, results of
    operations and cash flows.
   12




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out-of-pocket
      A
    number of asbestos-related claims have been received by our
    subsidiaries in the United Kingdom. To date, these claims have
    been covered by insurance policies and proceeds from the
    policies have been paid directly to the plaintiffs. The timing
    and amount of asbestos claims that may be made in the future,
    the financial solvency of the insurers and the amount that may
    be paid to resolve the claims, are uncertain. The insurance
    carriers failure to make payments due under the policies
    could materially adversely affect our business, financial
    condition, results of operations and cash flows.
  and/or
 13




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Risks
    Related to Our Liquidity and Capital Resources
  We
    require cash repatriations from our
    non-U.S.
    subsidiaries to meet our domestic cash needs related to our
    asbestos-related and other liabilities and corporate overhead
    expenses. Our ability to repatriate funds from our
    non-U.S.
    subsidiaries is limited by a number of factors.
  non-U.S. subsidiaries. non-U.S. subsidiaries
  Certain
    of our various debt agreements impose financial covenants, which
    may prevent us from capitalizing on business opportunities,
    which could negatively impact our business.
    We may
    have high working capital requirements, which could negatively
    impact our business, financial condition, and cash
    flows.
    We may
    invest in longer-term investment opportunities, such as the
    acquisition of other entities or operations in the engineering
    and construction industry or power industry. Acquisitions of
    other entities or operations have risks that could materially
    adversely affect our business, financial condition, results of
    operations and cash flows.
   14




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Risk
    Factors Related to Our Financial Reporting and Corporate
    Governance
  If we
    have a material weakness in our internal control over financial
    reporting, our ability to report our financial results on a
    timely and accurate basis may be adversely
    affected.
    We
    have anti-takeover provisions in our bye-laws that may
    discourage a change of control.
    
    The board of directors to be divided into three classes serving
    staggered three-year terms and the reservation for the board of
    directors, not the shareholders, of the right to increase the
    size of the board of directors. In addition, directors may be
    removed from office only for cause, by the affirmative vote of
    the holders of two-thirds of the issued shares generally
    entitled to vote and vacancies on the board of directors may
    only be filled by the remaining directors. These provisions of
    our bye-laws may delay or limit the ability of a shareholder to
    obtain majority representation on the board of directors.
    Any amendment to the bye-law limiting the removal of directors
    to be approved by the board of directors and the affirmative
    vote of the holders of three-quarters of the issued shares
    entitled to vote at general meetings.
    Restrictions on the time period in which directors may be
    nominated or shareholder proposals may be submitted. A
    shareholder notice to nominate an individual for election as a
    director or a shareholder proposal must be received no less than
    120 calendar days prior to the anniversary of the date on which
    we first mailed our proxy materials for the preceding
    years annual meeting. To be timely for consideration at
    the annual meeting of shareholders, a shareholder proposal must
    be received no less than 45 days prior to the anniversary
    of the date on which we first mailed our proxy materials for the
    preceding years annual meeting.
    The board of directors to determine the powers, preferences and
    rights of preference shares and to issue preference shares
    without shareholder approval.
    A general prohibition on business combinations
    between Foster Wheeler Ltd. and an interested
    member. Specifically, business combinations
    between an interested member, which is generally defined as a
    person or group of persons that owns, directly or indirectly,
    20% or more of the issued voting shares of Foster Wheeler Ltd.,
    and Foster Wheeler Ltd. are prohibited for a period of five
    years after the time the interested member acquires 20% or more
    of our outstanding voting shares, unless the business
    combination or the transaction resulting in the person becoming
    an interested member is approved by the board of directors prior
    to the date the interested member acquires 20% or more of the
    outstanding voting shares.
    Any matter submitted to the shareholders at a meeting called on
    the requisition of shareholders holding not less than one-tenth
    of our
    paid-up
    voting shares to be approved by the affirmative vote of all of
    the shares eligible to vote at such meeting.   15




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We are
    a Bermuda company and it may be difficult to enforce judgments
    against us or our directors and executive
    officers.
    Our
    bye-laws restrict shareholders from bringing legal action
    against our officers and directors.
   ITEM 1B. UNRESOLVED
    STAFF COMMENTS   16




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ITEM 2. PROPERTIES    Company (Business Segment*)





Building


Leaseand Location

Use

Land Area

Square Feet


Expires(1)Foster Wheeler Realty Services, Inc. (C&F)Union Township, New Jersey

Investment in undeveloped land


203.8 acres


General office & engineering


29.4 acres


294,000



2022Storage and reproduction facilities


10.8 acres


30,400Livingston, New Jersey

Research center


6.7 acres


51,355Foster Wheeler Energy Services, Inc. (GPG)San Diego, California

Office





11,015



2008Foster Wheeler USA Corporation (E&C)Houston, Texas

Office & engineering





107,890



2008
(2)Houston, Texas

Office & engineering





59,671



2009Houston, Texas

Office & engineering





74,025



2009Foster Wheeler Iberia, S.A. (E&C)/(GPG)Madrid, Spain

Office & engineering


5.5 acres


110,000



2015Santiago, Chile

Office & engineering





16,071



2011Foster Wheeler Energia, S.A. (GPG)Tarragona, Spain

Manufacturing & office


25.6 acres


77,794Foster Wheeler France, S.A. (E&C)Paris, France

Office & engineering





64,584



2013Foster Wheeler International Corporation (Thailand Branch)
    (E&C)Sriracha, Thailand

Office & engineering





59,944



2008Sriracha, Thailand

Office & engineering





49,199



2008Foster Wheeler International Engineering &
    Consulting (Shanghai) Company Limited (GPG and E&C)Shanghai, China

Office & engineering





35,796



2008Shanghai, China

Office & engineering





21,083



2009Shanghai, China

Office & engineering





21,031



2010Foster Wheeler Constructors, Inc. (GPG)McGregor, Texas

Storage facilities


15.0 acres


24,000Foster Wheeler Limited (England) (E&C)Glasgow, Scotland

Office & engineering


2.3 acres


28,798
(3)Reading, England

Office & engineering





76,711



2011Reading, England

Office & engineering


14.0 acres


365,521



2024Reading, England

Office & engineering





30,000



2009Reading, England

Investment in undeveloped land


12.0 acres


Teesside, England

Office & engineering





18,001



2014Foster Wheeler Limited (Nigeria) (E&C)Lagos, Nigeria

Office & engineering





13,000



2008Foster Wheeler Saudi Arabia Company Limited (E&C)Al-Khobar, Saudi Arabia

Office





45,000



2008 17




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Company (Business Segment*)





Building


Leaseand Location

Use

Land Area

Square Feet


Expires(1)Foster Wheeler South Africa (PTY) Limited (E&C)Midrand, South Africa

Office & engineering





55,294



2011Foster Wheeler India Private Limited (E&C)Chennai, India

Office & engineering





101,150



2011Kolkatta, India

Office & engineering





74,907



2016Foster Wheeler Canada Ltd. (GPG and E&C)Niagara-On-The-Lake,
    Ontario

Office & engineering





29,066



2008Foster Wheeler Power Machinery Company Limited (GPG)Xinhui, Guangdong, China

Manufacturing & office


29.2 acres


362,257
(4)


2045Xinhui, Guangdong, China

Manufacturing


2.6 acres






2008Xinhui, Guangdong, China

Manufacturing


3.2 acres






2012Xinhui, Guangdong, China

Storage facilities





48,141



2008Foster Wheeler Italiana, S.p.A. (E&C)Milan, Italy

Office & engineering





142,000



2012Milan, Italy

Office & engineering





121,870
(3)


2008Milan, Italy

Office & engineering





10,764



2011Milan, Italy

Office & engineering





10,764



2012Milan, Italy

Office & engineering





15,210



2009Foster Wheeler Pyropower, Inc. (GPG)Ridgecrest, California

Office & storage facilities





10,000



month to
    monthFoster Wheeler Bimas Birlesik Insaat ve Muhendislik A.S.
    (E&C)Istanbul, Turkey

Office & engineering





25,833



2010Foster Wheeler Eastern Private Limited (E&C)Singapore

Office & engineering





85,428



2008Foster Wheeler Power Systems, Inc. (GPG)Martinez, California

Cogeneration plant


6.4 acres


Camden, New Jersey

Waste-to-energy plant


18.0 acres






2011Talcahuano, Chile

Cogeneration plant-facility site


21.0 acres






2028Foster Wheeler Energia Oy (GPG)Varkaus, Finland

Manufacturing & office


22.2 acres


366,716Varkaus, Finland

Office





100,750



2031Espoo, Finland

Office





14,639



2011Foster Wheeler Energi Aktiebolag (GPG)Norrkoping, Sweden

Manufacturing & office





37,990



2014Foster Wheeler Service (Thailand) Limited (GPG)Rayong, Thailand

Manufacturing & office


3.15 acres


41,916



2017Foster Wheeler Energy FAKOP Sp. z o.o. (GPG)Sosnowiec, Poland

Manufacturing & office


19.5 acres


271,152
(5)


2089     *   Designation of Business Segments:

E&C  -  Global Engineering &
    Construction GroupGPG  -  Global Power GroupC&F  -  Corporate & Finance Group  18




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(1)
    
    Represents leases in which Foster Wheeler is the lessee.
    Properties for which a lease expiration is not indicated are
    owned.(2)
    
    Foster Wheeler USA Corporation has provided notice to terminate
    the lease in July 2008 and to move to a new 332,000 square
    foot facility with a lease expiration of 2018.(3)
    
    Portion or entire facility leased or subleased to third parties.(4)
    
    52% ownership interest.(5)
    
    53% ownership interest. ITEM 3. LEGAL
    PROCEEDINGS  Form 10-K.
 ITEM 4. SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS    Against or





BrokerFor


Withheld


Abstentions


Non-VotesIncrease in authorized share capital


63,448,418



354,870



50,270



0   two-for-one
 19




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PART II ITEM 5. MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES    two-for-one Form 10-K,
  one-for-twenty Form 10-K,
    For the three months endedMarch 30,


June 29,


September 28,


December 28,2007


2007


2007


2007Common share prices:High

$
29.80


$
55.19


$
68.40


$
84.24Low

$
23.25


$
28.97


$
42.17


$
63.24   For the three months endedMarch 31,


June 30,


September 29,


December 29,2006


2006


2006


2006Common share prices:High

$
26.85


$
26.44


$
22.43


$
28.47Low

$
17.99


$
17.43


$
16.01


$
19.03      20




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Performance
    Graph
    Comparision
    of Cumulative Total Return
  
     For the Year EndedDecember 27,

December 26,

December 31,

December 30,

December 29,

December 28,2002

2003

2004

2005

2006

2007Foster Wheeler Ltd.

$
100.00


$
91.06


$
64.51


$
149.51


$
224.15


$
635.24S&P 500 Index


100.00



127.47



143.41



150.45



174.21



185.05Peer
    Group(1)


100.00



148.19



192.11



293.73



358.18



722.82Old Peer
    Group(2)


100.00



154.71



195.28



310.41



395.29



893.98     (1)
    
    The following companies comprise the Peer Group: Chicago
    Bridge & Iron Company N.V., Fluor Corporation, Jacobs
    Engineering Group Inc., KBR, Inc., McDermott International, Inc.
    and Shaw Group, Inc. The Peer Group consists of companies that
    were compiled by us beginning this year for benchmarking the
    performance of our common shares.(2)
    
    The following companies comprise the Old Peer Group: Fluor
    Corporation, Foster Wheeler Ltd., Jacobs Engineering Group Inc.,
    Washington Group International, Inc. (formerly Morrison Knudsen
    and acquired by URS on November 15, 2007) and
    McDermott International, Inc. On January 25, 2003,
    Washington Group International, Inc. emerged from
    Chapter 11 Bankruptcy protection and under the Plan of
    Reorganization Washington Groups old common stock (WNGXQ)
    was canceled and new common stock was issued and distributed to
    lenders and creditors in accordance with the Plan. Washington
    Group International, Inc. is not included in the Old Peer Group
    for the year ended December 28, 2007 as Washington Group
    International, Inc. was acquired by another company on
    November 15, 2007. The Old Peer Group consists of companies
    that were compiled by us in 1996 for benchmarking the
    performance of our common shares; we have used this peer index
    since 1996 until adopting the Peer Group noted above. 21




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##### Table of Contents



ITEM 6. SELECTED
    FINANCIAL DATA  COMPARATIVE
    FINANCIAL STATISTICS
    (amounts in thousands of dollars, except share data and per
    share amounts)
  For the Year EndedDecember 28,


December 29,


December 30,


December 31,


December 26,2007


2006


2005


2004


2003Statement of Operations Data:Operating revenues

$
5,107,243


$
3,495,048


$
2,199,955


$
2,661,324


$
3,723,815Income/(loss) before income taxes


530,294
(1)


343,693
(2)


(70,181
)(3)


(232,172
)(4)


(109,637
)(5)Provision for income taxes


(136,420
)


(81,709
)


(39,568
)


(53,122
)


(47,426
)Net income/(loss)

$
393,874


$
261,984


$
(109,749
)

$
(285,294
)

$
(157,063
)Earnings/(loss) per common
    share:(6)Basic

$
2.78


$
1.82
(7)

$
(1.18
)

$
(28.92
)

$
(38.27
)Diluted

$
2.72


$
1.72
(7)

$
(1.18
)

$
(28.92
)

$
(38.27
)Shares
    outstanding:(6)Weighted-average number of common shares outstanding for basic
    earnings/(loss) per common share


141,661,046



132,996,384



93,140,176



9,864,740



4,104,458Effect of dilutive securities


3,087,176



8,221,592



*



*



*Weighted-average number of common shares outstanding for diluted
    earnings/(loss) per common share


144,748,222



141,217,976



93,140,176



9,864,740



4,104,458   As ofDecember 28,


December 29,


December 30,


December 31,


December 26,2007


2006


2005


2004


2003Balance Sheet Data:Current assets

$
2,044,383


$
1,389,628


$
851,523


$
1,039,458


$
1,174,376Current liabilities


1,523,773



1,247,603



997,564



1,251,581



1,350,359Working capital


520,610



142,025



(146,041
)


(212,123
)


(175,983
)Land, buildings and equipment, net


337,485



302,488



258,672



280,305



309,615Total assets


3,248,988



2,565,549



1,894,706



2,177,699



2,506,530Long-term debt (including currentinstallments)


205,346



202,969



315,412



570,073



1,033,072Total temporary equity


2,728



983











Total shareholders equity/(deficit)


571,041



62,727



(341,158
)


(525,565
)


(872,440
)Other Data:Unfilled orders (in terms of future revenues), end of year

$
9,420,400


$
5,431,400


$
3,692,300


$
2,048,100


$
2,285,400New orders booked (in terms of future revenues)


8,882,800



4,892,200



4,163,000



2,437,100



2,163,500     (1)
    
    Includes in fiscal year 2007: increased contract profit of
    $35,100 from the regular re-evaluation of contract profit
    estimates; gains of $13,500 on the settlement of coverage
    litigation with certain asbestos insurance carriers; and a net
    charge of $(7,400) on the revaluation of our asbestos liability
    and related asset resulting primarily from increased asbestos
    defense costs projected through year-end 2022 and for the
    addition of another year to our rolling
    15-year
    asbestos liability estimate.(2)
    
    Includes in fiscal year 2006: decreased contract profit of
    $(5,700) from the regular re-evaluation of contract profit
    estimates; a charge of $(15,600) on the revaluation of our
    asbestos liability and related asset; asbestos-related gains of
    $115,700 primarily from settlement of coverage litigation with
    certain asbestos insurance carriers; an aggregate charge of
    $(15,000) recorded in conjunction with the voluntary termination 22




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##### Table of Contents



of our prior domestic senior credit agreement; and a net charge
    of $(12,500) recorded in conjunction with the debt reduction
    initiatives completed in April and May 2006.(3)
    
    Includes in fiscal year 2005: increased contract profit of
    $99,600 from the regular re-evaluation of contract profit
    estimates; a charge of $(113,700) on the revaluation of our
    estimated asbestos liability and asbestos insurance receivable;
    credit agreement costs associated with our prior domestic senior
    credit facility of $(3,500); and an aggregate charge of
    $(58,300) recorded in conjunction with the exchange offers for
    our trust preferred securities and our senior notes due 2011,
    which we refer to as our 2011 senior notes.(4)
    
    Includes in fiscal year 2004: increased contract profit of
    $37,600 from the regular re-evaluation of contract profit
    estimates; a gain of $19,200 on the sales of minority equity
    interests in special-purpose companies established to develop
    power plant projects in Europe; a loss of $(3,300) on the sale
    of 10% of our equity interest in a
    waste-to-energy
    project in Italy; a charge of $(75,800) on the revaluation of
    asbestos insurance assets as a result of an adverse court
    decision in asbestos coverage allocation litigation; a net gain
    of $15,200 on the settlement of coverage litigation with certain
    asbestos insurance carriers; restructuring and credit agreement
    costs of $(17,200); a net charge of $(175,100) recorded in
    conjunction with the 2004
    equity-for-debt
    exchange; and charges for severance cost of $(5,700).(5)
    
    Includes in fiscal year 2003: a $(15,100) impairment loss on the
    anticipated sale of a domestic corporate office building; a
    $16,700 gain on the sale of certain assets of Foster Wheeler
    Environmental Corporation and a gain of $4,300 on the sale of a
    waste-to-energy
    plant; a gain on revisions to project claim estimates and
    related cost of $1,500; a charge related to revisions of project
    estimates and related receivable allowances of $(32,300); a
    provision for asbestos claims of $(68,100); restructuring and
    credit agreement costs of $(43,600); and charges for severance
    cost of $(15,900).(6)
    
    Amounts give retroactive effect to the
    two-for-one
    stock split that was effective January 22, 2008 and the
    one-for-twenty
    reverse stock split that was effective November 29, 2004.(7)
    
    As described further in Note 13 to the consolidated
    financial statements in this annual report on
    Form 10-K,
    we completed two common share purchase warrant offer
    transactions in January 2006. The fair value of the additional
    shares issued as part of the warrant offer transactions reduced
    net income attributable to our common shareholders when
    calculating earnings/(loss) per common share. The fair value of
    the additional shares issued was $19,445.*
    
    The impact of potentially dilutive securities such as
    outstanding stock options, warrants to purchase common shares,
    and the non-vested portion of restricted common shares and
    restricted common share units were not included in the
    calculation of diluted loss per common share in loss periods due
    to their antidilutive effect. 23




---



##### Table of Contents



ITEM 7. MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS (amounts in thousands of dollars)  Form 10-K.
  Safe
    Harbor Statement
  Form 10-K
  
    changes in the rate of economic growth in the United States and
    other major international economies;
    changes in investment by the oil and gas, oil refining,
    chemical/petrochemical, and power industries;
    changes in the financial condition of our customers;
    changes in regulatory environments;
    changes in project design or schedules;
    contract cancellations;
    changes in our estimates of costs to complete projects;
    changes in trade, monetary and fiscal policies worldwide;
    compliance with laws and regulations relating to our global
    operations;
    currency fluctuations;
    war and/or
    terrorist attacks on facilities either owned or where equipment
    or services are or may be provided;
    interruptions to shipping lanes or other methods of transit;
    outcomes of pending and future litigation, including litigation
    regarding our liability for damages and insurance coverage for
    asbestos exposure;
    protection and validity of our patents and other intellectual
    property rights;
    increasing competition by foreign and domestic companies;
    compliance with our debt covenants;
    recoverability of claims against our customers and others by us
    and claims by third-parties against us; and
    changes in estimates used in our critical accounting policies.   24




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##### Table of Contents



Form 10-Q, Form 10-K Form 8-K
  Overview
      Fiscal
    Year 2007 Results
  15-year
    
    Our consolidated operating revenues increased 46.1% to
    $5,107,200, as compared to fiscal year 2006, reflecting greater
    business activity in both our Global E&C Group and our
    Global Power Group.
    Our consolidated new orders, measured in terms of future
    revenues, increased 81.6% to $8,882,800, as compared to fiscal
    year 2006.
    Our consolidated backlog of unfilled orders, measured in future
    revenues, as of December 28, 2007 increased 73.4% to
    $9,420,400, as compared to December 29, 2006.
    Our consolidated backlog, measured in terms of Foster Wheeler
    scope (as defined below), as of December 28, 2007 increased
    30.3% to $3,294,600, as compared to December 29, 2006.
    We generated net cash from operations of $425,200 and ended the
    year with record total cash, restricted cash and short-term
    investments of $1,069,500.
    E&C
    man-hours in
    backlog (in thousands) as of December 28, 2007 were 13,400,
    as compared to 11,600 as of December 29, 2006.  Challenges
    and Drivers
     25




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##### Table of Contents



Results
    of Operations:
  Operating
    Revenues:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
5,107,243


$
3,495,048


$
2,199,955$ Change


1,612,195



1,295,093% Change


46.1
%


58.9
%   Form 10-K
    Contract Profit:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
744,321


$
507,787


$
346,342$ Change


236,534



161,445% Change


46.6
%


46.6
%        26




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##### Table of Contents



Selling, General, and Administrative (SG&A)
    Expenses:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
246,237


$
225,330


$
216,691$ Change


20,907



8,639% Change


9.3
%


4.0
%       Other
    Income:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
61,410


$
48,610


$
54,847$ Change


12,800



(6,237
)% Change


26.3
%


(11.4
)%   Form 10-K), waste-to-energy
  Form 10-K), waste-to-energy
 27




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##### Table of Contents



Form 10-K), waste-to-energy
  Other
    Deductions:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
45,540


$
45,453


$
36,529$ Change


87



8,924% Change


0.2
%


24.4
%         Interest
    Income:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
35,627


$
15,119


$
8,876$ Change


20,508



6,243% Change


135.6
%


70.3
%       Interest
    Expense:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
19,855


$
24,944


$
50,618$ Change


(5,089
)


(25,674
)% Change


(20.4
)%


(50.7
)%      28




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##### Table of Contents



Form 10-K
  Minority
    Interest in Income of Consolidated Affiliates:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
5,577


$
4,789


$
4,382$ Change


788



407% Change


16.5
%


9.3
%     Net
    Asbestos-Related Gains/(Provision):
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
6,145


$
100,131


$
(113,680
)$ Change


(93,986
)


213,811% Change


(93.9
)%


N/M     15-year
  15-year
    Form 10-K
  Prior
    Domestic Senior Credit Agreement Fees and
    Expenses:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$



$
14,955


$
$ Change


(14,955
)


14,955% Change


(100.0
)%


N/M    29




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##### Table of Contents



Loss
    on Debt Reduction Initiatives:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$



$
12,483


$
58,346$ Change


(12,483
)


(45,863
)% Change


(100.0
)%


(78.6
)%       Form 10-K
  Provision
    for Income Taxes:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
136,420


$
81,709


$
39,568$ Change


54,711



42,141% Change


67.0
%


106.5
%   non-U.S., and/or
  non-U.S. earnings
 30




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##### Table of Contents



non-U.S. earnings non-U.S. jurisdictions
      EBITDA:
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Amount

$
591,840


$
399,514


$
8,652$ Change


192,326



390,862% Change


48.1
%


4517.6
%   15-year
         31




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##### Table of Contents




    It does not include interest expense. Because we have borrowed
    money to finance some of our operations, interest is a necessary
    and ongoing part of our costs and has assisted us in generating
    revenue. Therefore, any measure that excludes interest expense
    has material limitations;
    It does not include taxes. Because the payment of taxes is a
    necessary and ongoing part of our operations, any measure that
    excludes taxes has material limitations; and
    It does not include depreciation and amortization. Because we
    must utilize property, plant and equipment and intangible assets
    in order to generate revenues in our operations, depreciation
    and amortization are necessary and ongoing costs of our
    operations. Therefore, any measure that excludes depreciation
    and amortization has material limitations.    Global


Global


C&FTotal


E&C Group


Power Group


Group(1)For the Year Ended December 28, 2007EBITDA(2)

$
591,840


$
505,647


$
139,177


$
(52,984
)Less: Interest expense


(19,855
)Less: Depreciation and amortization


(41,691
)Income before income taxes


530,294Provision for income taxes


(136,420
)Net income

$
393,874For the Year Ended December 29, 2006EBITDA(3)

$
399,514


$
323,297


$
95,039


$
(18,822
)Less: Interest expense


(24,944
)Less: Depreciation and amortization


(30,877
)Income before income taxes


343,693Provision for income taxes


(81,709
)Net income

$
261,984For the Year Ended December 30, 2005EBITDA(4)

$
8,652


$
165,629


$
107,266


$
(264,243
)Less: Interest expense


(50,618
)Less: Depreciation and amortization


(28,215
)Loss before income taxes


(70,181
)Provision for income taxes


(39,568
)Net loss

$
(109,749
)     (1)
    
    Includes general corporate income and expense, our captive
    insurance operation and eliminations. 32




---



##### Table of Contents



(2)
    
    Includes in fiscal year 2007: increased/(decreased) contract
    profit of $35,100 from the regular re-evaluation of contract
    profit estimates: $54,500 in our Global E&C Group and
    $(19,400) in our Global Power Group; a charge of $(7,400) in our
    C&F Group reflecting the revaluation of our asbestos
    liability and related asset resulting primarily from increased
    asbestos defense costs projected through year-end 2022 and for
    the addition of another year to our rolling
    15-year
    asbestos liability estimate; and gains of $13,500 on the
    settlement of coverage litigation with certain asbestos
    insurance carriers recorded in our C&F Group.(3)
    
    Includes in fiscal year 2006: (decreased)/increased contract
    profit of $(5,700) from the regular re-evaluation of contract
    profit estimates: $14,700 in our Global E&C Group and
    $(20,400) in our Global Power Group; a charge of $(15,600) in
    our C&F Group reflecting the revaluation of our asbestos
    liability and related asset; net asbestos-related gains of
    $115,700 recorded in our C&F Group primarily from
    settlement of coverage litigation with certain asbestos
    insurance carriers; an aggregate charge of $(15,000) recorded in
    our C&F Group in conjunction with the voluntary termination
    of our prior domestic senior credit agreement; and a net charge
    of $(12,500) recorded in our C&F Group in conjunction with
    the debt reduction initiatives completed in April and May 2006.(4)
    
    Includes in fiscal year 2005: increased contract profit of
    $99,600 from the regular re-evaluation of contract profit
    estimates: $66,300 in our Global E&C Group and $33,300 in
    our Global Power Group; a charge of $(113,700) in our C&F
    Group on the revaluation of our estimated asbestos liability and
    asbestos insurance receivable; credit agreement costs in our
    C&F Group associated with our prior senior credit facility
    of $(3,500); and an aggregate charge of $(58,300) in our
    C&F Group recorded in conjunction with the exchange offers
    for our trust preferred securities and our 2011 senior notes.  Business
    Segments
    Global
    E&C Group
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Operating revenues

$
3,681,259


$
2,219,104


$
1,471,948$ Change


1,462,155



747,156% Change


65.9
%


50.8
%EBITDA

$
505,647


$
323,297


$
165,629$ Change


182,350



157,668% Change


56.4
%


95.2
%   Results
       33




---



##### Table of Contents



Overview
    of Segment
        and/or
     34




---



##### Table of Contents



Global
    Power Group
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Operating revenues

$
1,425,984


$
1,275,944


$
728,024$ Change


150,040



547,920% Change


11.8
%


75.3
%EBITDA

$
139,177


$
95,039


$
107,266$ Change


44,138



(12,227
)% Change


46.4
%


(11.4
)%   Results
     35




---



##### Table of Contents



Form 10-K.
      Overview
    of Segment
      North
    America
   36




---



##### Table of Contents



2 2
      Europe
   37




---



##### Table of Contents



Asia
  2
  Liquidity
    and Capital Resources
  Fiscal
    Year 2007 Activities
   38




---



##### Table of Contents



Form 10-K
    Form 10-K.
    Outlook
  non-U.S. subsidiaries, 12-month
 39




---



##### Table of Contents



and/or
    non-U.S. subsidiaries
    and/or
    Form 10-K
    Off-Balance
    Sheet Arrangements
  Form 10-K
 40




---



##### Table of Contents



Contractual
    Obligations
    Less thanTotal


1 Year


1-3 Years


3-5 Years


More than 5 YearsLong-term debt:Principal

$
136,900


$
18,000


$
50,200


$
14,900


$
53,800Interest


59,900



10,400



16,300



9,100



24,100Non-cancelable operating lease commitments


433,800



52,800



85,300



66,600



229,100Purchase commitments


1,403,000



1,315,400



85,000



2,000



600Capital lease obligations:Principal


68,400



1,300



3,400



4,100



59,600Interest


76,500



7,200



13,600



12,900



42,800Pension funding requirements 
    U.S.(1)


















Pension funding requirements 
    foreign(2)


151,500



33,400



62,000



56,100



Total contractual cash obligations

$
2,330,000


$
1,438,500


$
315,800


$
165,700


$
410,000     (1)
    
    Funding requirements are not expected in the next
    five years; however, data for contribution requirements
    beyond five years are not yet available. These projections
    assume we do not make any discretionary contributions.(2)
    
    Funding requirements are expected to extend beyond
    five years; however, data for contribution requirements
    beyond five years are not yet available. These projections
    assume we do not make any discretionary contributions.  Form 10-K
  Form 10-K
    Total


Less than 1 Year


1-3 Years


3-5 Years


More than 5 YearsBank issued letters of credit and guarantees

$
788,700


$
303,100


$
243,100


$
179,100


$
63,400Surety bonds


29,900











29,900



Total commitments

$
818,600


$
303,100


$
243,100


$
209,000


$
63,400   Form 10-K
 41




---



##### Table of Contents



Backlog
    and New Orders
      Global


GlobalE&C Group


Power Group


TotalNEW ORDERS (FUTURE REVENUES) BY PROJECT LOCATION:For the Year Ended December 28, 2007:North America

$
212,300


$
1,028,500


$
1,240,800South America


30,100



144,100



174,200Europe


845,400



649,600



1,495,000Asia


1,468,500



172,800



1,641,300Middle East


437,700



5,300



443,000Australasia and other


3,880,600



7,900



3,888,500Total

$
6,874,600


$
2,008,200


$
8,882,800For the Year Ended December 29, 2006:North America

$
287,000


$
755,400


$
1,042,400South America


11,200



85,900



97,100Europe


735,300



268,500



1,003,800Asia


1,307,200



83,700



1,390,900Middle East


1,043,800



1,600



1,045,400Australasia and other


310,800



1,800



312,600Total

$
3,695,300


$
1,196,900


$
4,892,200For the Year Ended December 30, 2005:North America

$
67,300


$
540,600


$
607,900South America


119,100



14,700



133,800Europe


567,200



471,400



1,038,600Asia


679,500



46,300



725,800Middle East


534,800



5,600



540,400Australasia and other


1,113,000



3,500



1,116,500Total

$
3,080,900


$
1,082,100


$
4,163,000 42




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##### Table of Contents



Global


GlobalE&C Group


Power Group


TotalNEW ORDERS (FUTURE REVENUES) BY INDUSTRY:For the Year Ended December 28, 2007:Power generation

$
96,000


$
1,883,500


$
1,979,500Oil refining


1,218,400







1,218,400Pharmaceutical


81,800







81,800Oil and gas


4,082,100







4,082,100Chemical/petrochemical


1,356,000







1,356,000Power plant operation and maintenance






124,700



124,700Environmental


15,000







15,000Other, net of eliminations


25,300







25,300Total

$
6,874,600


$
2,008,200


$
8,882,800For the Year Ended December 29, 2006:Power generation

$
95,700


$
1,096,100


$
1,191,800Oil refining


1,342,200







1,342,200Pharmaceutical


107,600







107,600Oil and gas


444,500







444,500Chemical/petrochemical


1,593,300







1,593,300Power plant operation and maintenance






100,800



100,800Environmental


87,800







87,800Other, net of eliminations


24,200







24,200Total

$
3,695,300


$
1,196,900


$
4,892,200For the Year Ended December 30, 2005:Power generation

$
142,600


$
949,600


$
1,092,200Oil refining


1,068,300







1,068,300Pharmaceutical


74,600







74,600Oil and gas


1,368,700







1,368,700Chemical/petrochemical


371,100







371,100Power plant operation and maintenance






132,500



132,500Environmental


50,100







50,100Other, net of eliminations


5,500







5,500Total

$
3,080,900


$
1,082,100


$
4,163,000 43




---



##### Table of Contents



Global


GlobalE&C Group


Power Group


TotalBACKLOG (FUTURE REVENUES) BY CONTRACT TYPE:As of December 28, 2007:Lump-sum turnkey

$
66,500


$
434,700


$
501,200Other fixed-price


470,900



978,300



1,449,200Reimbursable


7,289,700



191,200



7,480,900Eliminations


(5,100
)


(5,800
)


(10,900
)Total

$
7,822,000


$
1,598,400


$
9,420,400As of December 29, 2006:Lump-sum turnkey

$
194,000


$
256,100


$
450,100Other fixed-price


454,600



637,600



1,092,200Reimbursable


3,886,600



37,500



3,924,100Eliminations


(33,700
)


(1,300
)


(35,000
)Total

$
4,501,500


$
929,900


$
5,431,400As of December 30, 2005:Lump-sum turnkey

$
376,600


$
313,000


$
689,600Other fixed-price


238,800



610,200



849,000Reimbursable


2,163,100



55,500



2,218,600Eliminations


(47,800
)


(17,100
)


(64,900
)Total

$
2,730,700


$
961,600


$
3,692,300 44




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##### Table of Contents



Global


GlobalE&C Group


Power Group


TotalBACKLOG (FUTURE REVENUES) BY PROJECT LOCATION:As of December 28, 2007:North America

$
150,900


$
742,900


$
893,800South America


26,200



132,800



159,000Europe


610,700



580,000



1,190,700Asia


2,014,200



137,700



2,151,900Middle East


1,051,900



600



1,052,500Australasia and other


3,968,100



4,400



3,972,500Total

$
7,822,000


$
1,598,400


$
9,420,400As of December 29, 2006:North America

$
205,600


$
459,700


$
665,300South America


55,700



49,200



104,900Europe


599,800



338,700



938,500Asia


1,269,200



80,000



1,349,200Middle East


1,592,300



800



1,593,100Australasia and other


778,900



1,500



780,400Total

$
4,501,500


$
929,900


$
5,431,400As of December 30, 2005:North America

$
95,200


$
447,000


$
542,200South America


107,900



13,200



121,100Europe


436,200



393,900



830,100Asia


684,700



101,900



786,600Middle East


445,000



2,600



447,600Australasia and other


961,700



3,000



964,700Total

$
2,730,700


$
961,600


$
3,692,300 45




---



##### Table of Contents



Global


GlobalE&C Group


Power Group


TotalBACKLOG (FUTURE REVENUES) BY INDUSTRY:As of December 28, 2007:Power generation

$
56,400


$
1,476,600


$
1,533,000Oil refining


1,633,100







1,633,100Pharmaceutical


41,400







41,400Oil and gas


4,078,600







4,078,600Chemical/petrochemical


1,988,000







1,988,000Power plant operation and maintenance






121,800



121,800Environmental


12,700







12,700Other, net of eliminations


11,800







11,800Total

$
7,822,000


$
1,598,400


$
9,420,400Foster Wheeler scope in backlog

$
1,709,100


$
1,585,500


$
3,294,600E&C
    man-hours in
    backlog (in thousands)


13,400







13,400As of December 29, 2006:Power generation

$
122,000


$
812,200


$
934,200Oil refining


1,736,400







1,736,400Pharmaceutical


106,000







106,000Oil and gas


901,700







901,700Chemical/petrochemical


1,576,800







1,576,800Power plant operation and maintenance






117,700



117,700Environmental


61,700







61,700Other, net of eliminations


(3,100
)






(3,100
)Total

$
4,501,500


$
929,900


$
5,431,400Foster Wheeler scope in backlog

$
1,611,500


$
916,700


$
2,528,200E&C
    man-hours in
    backlog (in thousands)


11,600







11,600As of December 30, 2005:Power generation

$
154,600


$
833,600


$
988,200Oil refining


897,200







897,200Pharmaceutical


123,500







123,500Oil and gas


1,148,400







1,148,400Chemical/petrochemical


302,600







302,600Power plant operation and maintenance






128,000



128,000Environmental


88,000







88,000Other, net of eliminations


16,400







16,400Total

$
2,730,700


$
961,600


$
3,692,300Foster Wheeler scope in backlog

$
1,212,400


$
947,300


$
2,159,700E&C
    man-hours in
    backlog (in thousands)


9,300







9,300  46




---



##### Table of Contents



Inflation
    Application
    of Critical Accounting Estimates
      Revenue
    Recognition
    man-hour,
  (man-hours),
    81-1,
 47




---



##### Table of Contents



and/or
  Asbestos
      United States
      and/or
   48




---



##### Table of Contents



Approximate ChangeChanges (Increase or Decrease) in Assumption:

in LiabilityOne-percentage point change in the inflation rate related to the
    indemnity and defense costs

$
24,000Twenty-five percent change in average indemnity settlement amount


70,400Twenty-five percent change in forecasted number of new claims


59,500    49




---



##### Table of Contents



United Kingdom
    Defined
    Benefit Pension and Other Postretirement Benefit Plans
    Form 10-K
    
    The discount rate used to calculate the present value of future
    obligations;
    The expected long-term rate of return on plan assets;
    The expected rate of annual salary increases;
    The selection of the actuarial mortality tables;
    The annual healthcare cost trend rate (only for the other
    postretirement benefit plans); and 50




---



##### Table of Contents




    The annual inflation rate.      For the Year EndedDecember 28, 2007


December 29, 2006


December 30, 2005United


United





United


United





United


UnitedStates


Kingdom


Other


States


Kingdom


Other


States


Kingdom


OtherWeighted-average assumptions  net periodic
    benefit cost:Discount rate


5.81
%


5.14
%


4.50
%


5.45
%


4.86
%


4.60
%


5.48
%


5.44
%


5.03
%Long-term rate of return


8.00
%


6.94
%


7.50
%


8.00
%


6.84
%


7.50
%


8.00
%


7.32
%


7.50
%Salary growth


N/A



3.83
%


2.35
%


N/A



3.84
%


3.21
%


N/A



3.33
%


2.95
%Weighted-average assumptions  projected
    benefit obligations:Discount rate


6.31
%


5.72
%


5.30
%


5.80
%


5.13
%


4.69
%Salary growth


N/A



4.12
%


3.47
%


N/A



3.82
%


3.39
%         Approximate Increase (Decrease)Impact on 2008Impact on Liabilities


Benefit CostU.S. Pension Plans:One-tenth of a percentage point increase in the discount rate

$
(3,602
)

$
(54
)One-tenth of a percentage point decrease in the discount rate


3,644



50One-tenth of a percentage point increase in the expected return
    on plan assets






(319
)One-tenth of a percentage point decrease in the expected return
    on plan assets






319U.K. Pension Plans:One-tenth of a percentage point increase in the discount rate

$
(15,973
)

$
(2,021
)One-tenth of a percentage point decrease in the discount rate


16,372



2,049One-tenth of a percentage point increase in the expected return
    on plan assets






(725
)One-tenth of a percentage point decrease in the expected return
    on plan assets






723  51




---



##### Table of Contents



For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Weighted-average assumptions  net periodic
    postretirement benefit cost:Discount rate


5.73
%


5.39
%


5.35
%Weighted-average assumptions  accumulated
    postretirement benefit obligation:Discount rate


6.20
%


5.73
%       Share-Based
    Compensation Plans
   52




---



##### Table of Contents




    Expected volatility  we estimate the volatility of
    our common share price at the date of grant using historical
    volatility adjusted for periods of unusual stock price activity.
    Expected term  we estimate the expected term of
    options granted to our chief executive officer based on a
    combination of vesting schedules, contractual life of the
    option, past history and estimates of future exercise behavior
    patterns. For grants to other employees and the remaining
    directors, we estimate the expected term using the
    simplified method, as outlined in Staff Accounting
    Bulletin No. 107, Topic 14: Share-Based
    Payment.
    Risk-free interest rate  we estimate the risk-free
    interest rate using the U.S. Treasury yield curve for
    periods equal to the expected term of the options in effect at
    the time of grant.
    Dividends  we use an expected dividend yield of zero
    because we have not declared or paid a cash dividend since July
    2001 and we do not have any plans to declare or pay any cash
    dividends.     53




---



##### Table of Contents



Goodwill
    and Intangible Assets
        Income
    Taxes
       54




---



##### Table of Contents



non-U.S. jurisdictions 12-month non-U.S. income
          Accounting
    Developments
       55




---



##### Table of Contents



ITEM 7A. QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    (amounts in thousands of dollars)  Interest Rate Risk
  Foreign Currency Risk non-U.S. affiliates
  Form 10-K
 56




---



##### Table of Contents



Hedged Foreign


Notional Amount of


Notional Amount ofCurrency Exposure


Forward Buy Contracts


Forward Sell ContractCurrency Hedged

Functional


(in equivalent


(in equivalent


(in equivalent(bought or sold forward)

Currency


U.S. dollars)


U.S. dollars)


U.S. dollars)Euro


British pound


$
5,328


$
2,502


$
2,826Chilean peso



387







387Polish zloty


Euro



105,335



105,335



U.S. dollar



720



720



Thai baht


British pound



1,839



1,839



U.S. dollar


British pound



154,357







154,357Euro



3,832



3,832



Singapore dollar



211







211United Arab Emirates dirham


British pound



2,307



2,307



Total


$
274,316


$
116,535


$
157,781   Form 10-K
 57




---



##### 



ITEM 8. FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA  Index to
    Financial Statements
   
 PageReport of Independent Registered Public
    Accounting Firm


59Consolidated Statement of Operations


60Consolidated Balance Sheet


61Consolidated Statement of Changes in
    Shareholders Equity/(Deficit)


62Consolidated Statement of Comprehensive
    Income/(Loss)


63Consolidated Statement of Cash Flows


64Notes to Consolidated Financial Statements


66Financial Statement Schedule


121   58




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm    Internal Control  Integrated
    Framework Form 10-K.
        PricewaterhouseCoopers
    LLP
    59




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  CONSOLIDATED STATEMENT OF OPERATIONS
 (in thousands of dollars, except per share amounts)
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Operating revenues

$
5,107,243


$
3,495,048


$
2,199,955Cost of operating revenues


(4,362,922
)


(2,987,261
)


(1,853,613
)Contract profit


744,321



507,787



346,342Selling, general and administrative expenses


(246,237
)


(225,330
)


(216,691
)Other income


61,410



48,610



54,847Other deductions


(45,540
)


(45,453
)


(36,529
)Interest income


35,627



15,119



8,876Interest expense


(19,855
)


(24,944
)


(50,618
)Minority interest in income of consolidated affiliates


(5,577
)


(4,789
)


(4,382
)Net asbestos-related gains/(provision)


6,145



100,131



(113,680
)Prior domestic senior credit agreement fees and expenses






(14,955
)


Loss on debt reduction initiatives






(12,483
)


(58,346
)Income/(loss) before income taxes


530,294



343,693



(70,181
)Provision for income taxes


(136,420
)


(81,709
)


(39,568
)Net income/(loss)

$
393,874


$
261,984


$
(109,749
)Earnings/(loss) per common share (see Note 1):Basic

$
2.78


$
1.82


$
(1.18
)Diluted

$
2.72


$
1.72


$
(1.18
)    60




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEET
 (in
    thousands of dollars, except share data and per share
    amounts)
  December 28,


December 29,2007


2006ASSETSCurrent Assets:Cash and cash equivalents

$
1,048,544


$
610,887Accounts and notes receivable, net:Trade


580,883



483,819Other


98,708



83,497Contracts in process


239,737



159,121Prepaid, deferred and refundable income taxes


36,532



21,016Other current assets


39,979



31,288Total current assets


2,044,383



1,389,628Land, buildings and equipment, net


337,485



302,488Restricted cash


20,937



19,080Notes and accounts receivable  long-term


2,941



5,395Investments in and advances to unconsolidated affiliates


198,346



167,186Goodwill, net


53,345



51,573Other intangible assets, net


61,190



62,004Asbestos-related insurance recovery receivable


324,588



350,322Other assets


93,737



91,081Deferred income taxes


112,036



126,792TOTAL ASSETS

$
3,248,988


$
2,565,549LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS
    EQUITYCurrent Liabilities:Current installments on long-term debt

$
19,368


$
21,477Accounts payable


372,531



263,715Accrued expenses


331,814



288,658Billings in excess of costs and estimated earnings on
    uncompleted contracts


744,236



622,422Income taxes payable


55,824



51,331Total current liabilities


1,523,773



1,247,603Long-term debt


185,978



181,492Deferred income taxes


81,008



66,048Pension, postretirement and other employee benefits


290,741



385,976Asbestos-related liability


376,803



424,628Other long-term liabilities


185,143



166,169Minority interest


31,773



29,923Commitments and contingenciesTOTAL LIABILITIES


2,675,219



2,501,839Temporary Equity:Non-vested restricted awards subject to redemption


2,728



983TOTAL TEMPORARY EQUITY


2,728



983Shareholders Equity:Preferred shares:$0.01 par value; authorized: December 28,
    2007  901,943 shares and December 29,
    2006  903,714 shares; issued and outstanding:
    December 28, 2007  1,887 shares and
    December 29, 2006  3,658 shares






Common shares:$0.01 par value; authorized: December 28,
    2007  296,007,011 shares and December 29,
    2006  296,003,468 shares; issued and
    outstanding: December 28, 2007 - 143,877,804 shares
    and December 29, 2006  138,182,948 shares


1,439



1,382Paid-in capital


1,385,311



1,348,800Accumulated deficit


(554,595
)


(944,113
)Accumulated other comprehensive loss


(261,114
)


(343,342
)TOTAL SHAREHOLDERS EQUITY


571,041



62,727TOTAL LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS
    EQUITY

$
3,248,988


$
2,565,549    61




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY/(DEFICIT)
 (in
    thousands of dollars, except share data)
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Shares


Amount


Shares


Amount


Shares


AmountPreferred Shares:Balance at beginning of year


3,658


$




4,195


$




75,484


$
1Preferred shares converted into common shares


(1,771
)






(537
)






(71,289
)


(1
)Balance at end of year


1,887


$




3,658


$




4,195


$
Common Shares:Balance at beginning of year


138,182,948


$
1,382



114,924,524


$
1,150



81,085,796


$
810Issuance of common shares upon exercise of common share purchase
    warrants


1,801,798



18



16,888,556



169



949,218



10Issuance of common shares upon
    equity-for-debt
    exchanges










2,555,800



26



23,322,890



234Issuance of common shares upon exercise of stock options


2,976,020



30



3,046,430



30



255,890



2Issuance of common shares related to restricted awards


686,818



7



701,614



7



34,832



2Cancellation of common shares upon forfeiture of restricted
    awards










(4,952
)










Issuance of common shares upon conversion of preferred shares


230,220



2



70,976







9,275,898



92Balance at end of year


143,877,804


$
1,439



138,182,948


$
1,382



114,924,524


$
1,150Paid-in Capital:Balance at beginning of year





$
1,348,800






$
1,186,943






$
882,762Issuance of common shares upon exercise of common share purchase
    warrants






8,430







75,514







4,441Issuance of common shares upon
    equity-for-debt
    exchanges














58,737







296,759Issuance of common shares upon exercise of stock options






18,046







17,565







1,198Issuance of common shares related to restricted awards






(7
)






(7
)






1,229Share-based compensation expense-stock options and restricted
    awards






5,350







15,491







Excess tax benefit related to share-based compensation






4,694







2,915







645Reclassification of unearned compensation balance upon adoption
    of SFAS No. 123R














(8,358
)






Issuance of common shares upon conversion of preferred shares






(2
)














(91
)Balance at end of year





$
1,385,311






$
1,348,800






$
1,186,943Accumulated Deficit:Balance at beginning of year





$
(944,113
)





$
(1,206,097
)





$
(1,096,348
)Cumulative effect of adoption of FIN 48






(4,356
)














Balance at beginning of year, as adjusted






(948,469
)






(1,206,097
)






(1,096,348
)Net income/(loss) for the year






393,874







261,984







(109,749
)Balance at end of year





$
(554,595
)





$
(944,113
)





$
(1,206,097
)Accumulated Other Comprehensive Loss:Balance at beginning of year





$
(343,342
)





$
(314,796
)





$
(296,743
)Foreign currency translation adjustments






31,939







31,612







(22,928
)Net gains on derivative instruments designated as cash flow
    hedges (net of tax provision: 2007  $432;
    2006  $203)






1,331







342







Defined benefit pension and other postretirement plans:Minimum pension liability adjustments (net of tax provision:2006  $4,674; 2005  $8,456)














40,087







4,875Adjustment resulting from the adoption of SFAS No. 158
    (net of tax benefit: 2006  $54,364)














(100,587
)






Net actuarial gains arising during the period (net of tax
    provision of $5,836)






33,032















Reclassification adjustments for amortization of prior service
    cost/(credit), net loss/(gain) and transition obligation/
    (asset) included in net periodic benefit expense (net of tax
    provision of $6,799)






15,926















Balance at end of year





$
(261,114
)





$
(343,342
)





$
(314,796
)Unearned Compensation:Balance at beginning of year





$







$
(8,358
)





$
(16,047
)Issuance of restricted awards






















(1,230
)Share-based compensation expense-restricted awards






















8,919Reclassification of unearned compensation balance upon adoption
    of SFAS No. 123R














8,358







Balance at end of year





$







$







$
(8,358
)Total Shareholders Equity/(Deficit)





$
571,041






$
62,727






$
(341,158
)    62




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES



CONSOLIDATED
    STATEMENT OF COMPREHENSIVE INCOME/(LOSS)

(in
    thousands of dollars)  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Net income/(loss)

$
393,874


$
261,984


$
(109,749
)Foreign currency translation adjustments


31,939



31,612



(22,928
)Net gains on derivative instruments designated as cash flow
    hedges (net of tax provision: 2007  $432;
    2006  $203)


1,331



342



Defined benefit pension and other postretirement plans:Minimum pension liability adjustments (net of tax provision:2006  $4,674; 2005  $8,456)






40,087



4,875Net actuarial gains arising during the period (net of tax
    provision of $5,836)


33,032







Reclassification adjustments for amortization of prior service
    cost/(credit), net loss/(gain) and transition obligation/
    (asset) included in net periodic benefit expense (net of tax
    provision of $6,799)


15,926







Comprehensive income/(loss)

$
476,102


$
334,025


$
(127,802
)    63




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES



CONSOLIDATED
    STATEMENT OF CASH FLOWS

(in
    thousands of dollars, except share data)  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005CASH FLOWS FROM OPERATING ACTIVITIESNet income/(loss)

$
393,874


$
261,984


$
(109,749
)Adjustments to reconcile net income/(loss) to cash flows from
    operating activities:Depreciation and amortization


41,691



30,877



28,215Net asbestos-related (gains)/provision


7,374



(66,603
)


113,680Loss on debt reduction initiatives






5,206



51,491Prior domestic senior credit agreement fees and expenses






9,488



Share-based compensation expense-stock options and restricted
    awards


7,095



16,474



8,919Excess tax benefit related to share-based compensation


(4,694
)


(2,796
)


Deferred tax provision


31,937



14,302



10,527Interest expense on subordinated deferrable interest debentures










5,288Gain on sale of assets


(7,657
)


(1,464
)


(1,582
)Equity in the net earnings of partially-owned affiliates, net of
    dividends


(18,897
)


(7,837
)


(9,303
)Other noncash items


(3,785
)


(4,555
)


8,021Changes in assets and liabilities:Increase in receivables


(83,930
)


(225,158
)


(7,563
)Net change in contracts in process and billings in excess of
    costs and estimated earnings on uncompleted contracts


25,833



177,350



(15,130
)Increase/(decrease) in accounts payable and accrued expenses


123,968



39,908



(28,904
)(Decrease)/increase in income taxes payable


(7,295
)


27,614



(14,756
)Net change in other assets and liabilities


(80,315
)


(11,129
)


11,659Net cash provided by operating activities


425,199



263,661



50,813CASH FLOWS FROM INVESTING ACTIVITIESAcquisition of businesses, net of cash acquired


(6,319
)


457



Change in restricted cash


(856
)


8,940



46,186Capital expenditures


(51,295
)


(30,293
)


(10,809
)Proceeds from sale of assets


7,567



1,914



4,853Investments in and advances to unconsolidated affiliates


(1,382
)


(6,573
)


(1,067
)Return of investment from unconsolidated affiliates


6,324







Decrease in short-term investments










24,424Net cash (used in)/provided by investing activities


(45,961
)


(25,555
)


63,587  64




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
    CONSOLIDATED STATEMENT OF CASH FLOWS
    (in thousands of dollars, except share data)(Continued)
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005CASH FLOWS FROM FINANCING ACTIVITIESPartnership distributions to minority partners


(2,063
)


(1,950
)


(2,233
)Proceeds from common share purchase warrant exercises


8,448



75,683



4,451Proceeds from stock option exercises


18,076



17,595



1,200Excess tax benefit related to share-based compensation


4,694



2,796



Payment of deferred financing costs






(5,710
)


(13,724
)Proceeds from issuance of long-term debt


15,628



2,138



371Repayment of long-term debt and capital lease obligations


(6,598
)


(90,082
)


(31,516
)Net cash provided by/(used in) financing activities


38,185



470



(41,451
)Effect of exchange rate changes on cash and cash equivalents


20,234



21,642



(13,847
)INCREASE IN CASH AND CASH EQUIVALENTS


437,657



260,218



59,102Cash and cash equivalents at beginning of year


610,887



350,669



291,567CASH AND CASH EQUIVALENTS AT END OF YEAR

$
1,048,544


$
610,887


$
350,669Cash paid during the year for:Interest (net of amount capitalized)

$
13,384


$
25,102


$
47,295Income taxes

$
111,279


$
38,611


$
22,361   NON-CASH
    FINANCING ACTIVITIES
  equity-for-debt
    equity-for-debt
  equity-for-debt
   65




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
  1.
    Summary
    of Significant Accounting Policies  Principles of Consolidation
    Capital Alterations two-for-one
  Use of Estimates
  Revenue Recognition on Long-Term Contracts percentage-of-completion cost-to-cost
  man-hour,
    81-1,
 66




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)  and/or
  SOP 81-1,
      Cash and Cash Equivalents
  Trade Accounts Receivable
 67




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)    Contracts in Process and Billings in Excess of Costs and
    Estimated Earnings on Uncompleted Contracts
  Inventories
  Land, Buildings and Equipment
  Restricted Cash
  December 28, 2007


December 29, 2006Foreign


Domestic


Total


Foreign


Domestic


TotalHeld by special-purpose entities and restricted for debt service
    payments

$
5,766


$
257


$
6,023


$
5,236


$
252


$
5,488Held to collateralize letters of credit and bank guarantees


6,800







6,800



5,345







5,345Client funds held in escrow


6,787



1,327



8,114



7,622



625



8,247Total

$
19,353


$
1,584


$
20,937


$
18,203


$
877


$
19,080   Investments in and Advances to Unconsolidated
    Affiliates
  Intangible Assets
   68




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)        December 28, 2007


December 29, 2006Gross





Net


Gross





NetCarrying


Accumulated


Carrying


Carrying


Accumulated


CarryingAmount


Amortization


Amount


Amount


Amortization


AmountPatents

$
39,375


$
(21,026
)

$
18,349


$
37,185


$
(19,206
)

$
17,979Trademarks


63,344



(20,503
)


42,841



62,699



(18,674
)


44,025Total

$
102,719


$
(41,529
)

$
61,190


$
99,884


$
(37,880
)

$
62,004     Income Taxes
     69




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)      Foreign Currency
  For the Year EndedDecember 28,

December 29,

December 30,2007

2006

2005Foreign currency transaction losses

$
(2,640
)

$
(1,719
)

$
(2,705
)Foreign currency transaction losses, net of tax

$
(1,716
)

$
(1,117
)

$
(1,758
)   Interest Rate Risk
  Restrictions on Shareholders Dividends
  Earnings per Common Share sub-set
 70




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)         71




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)    For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Net income/(loss)

$
393,874


$
261,984


$
(109,749
)Fair value of additional shares issued as part of warrant offers






(19,445
)


Net income/(loss) attributable to common shareholders

$
393,874


$
242,539


$
(109,749
)Basic earnings/(loss) per common share:Net income/(loss) attributable to common shareholders

$
393,874


$
242,539


$
(109,749
)Weighted-average number of common shares outstanding for basic
    earnings/(loss) per common share


141,661,046



132,996,384



93,140,176Basic earnings/(loss) per common share

$
2.78


$
1.82


$
(1.18
)Diluted earnings/(loss) per common share:Net income/(loss) attributable to common shareholders

$
393,874


$
242,539


$
(109,749
)Weighted-average number of common shares outstanding for basic
    earnings/(loss) per common share


141,661,046



132,996,384



93,140,176Effect of dilutive securities:Options to purchase common shares


1,082,254



2,997,096



Warrants to purchase common shares


1,790,072



3,443,376



Non-vested portion of restricted awards


214,850



1,781,120



Weighted-average number of common shares outstanding for diluted
    earnings/(loss) per common share


144,748,222



141,217,976



93,140,176Diluted earnings/(loss) per common share

$
2.72


$
1.72


$
(1.18
)  72




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)    For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Common shares issuable under outstanding options not included in
    the computation of diluted earnings/(loss) per common share
    because the assumed proceeds were greater than our average
    common share price for the period


347,698



1,372,582



1,166,770Common shares issuable under outstanding options not included in
    the computation of diluted earnings/(loss) per common share
    because of their antidilutive effect










5,401,250Warrants to purchase common shares not included in the
    computation of diluted earnings/(loss) per common share due to
    their antidilutive effect










18,936,200Non-vested portion of restricted awards not included in the
    computation of diluted earnings/(loss) per common share due to
    their antidilutive effect










3,379,458   Share-Based Compensation Plans
   73




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)    For the Year EndedDecember 30,2005Net loss attributable to common shareholders  as
    reported

$
(109,749
)Add: Total share-based employee compensation expense determined
    under intrinsic value based method for awards and included
    within reported net loss, net of $0 taxes


150Deduct: Total share-based employee compensation expense
    determined under fair value based method for awards, net of
    taxes of $186


(6,740
)Net loss attributable to common shareholders  pro
    forma

$
(116,339
)Loss per common share  basic and diluted:As reported

$
(1.18
)Pro forma

$
(1.25
)     
    Expected volatility  we estimate the volatility of
    our common share price at the date of grant using historical
    volatility adjusted for periods of unusual stock price activity.
    Expected term  we estimate the expected term of
    options granted to our chief executive officer based on a
    combination of vesting schedules, contractual life of the
    option, past history and estimates of future exercise behavior
    patterns as outlined in SFAS No. 123R. For grants to
    other employees and the remaining directors, we estimate the
    expected term using the simplified method, as
    outlined in Staff Accounting Bulletin No. 107,
    Topic 14: Share-Based Payment.
    Risk-free interest rate  we estimate the risk-free
    interest rate using the U.S. Treasury yield curve for
    periods equal to the expected term of the options in effect at
    the time of grant.
    Dividends  we use an expected dividend yield of zero
    because we have not declared or paid a cash dividend since July
    2001 and we do not have any plans to declare or pay any cash
    dividends.    For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Expected volatility


44
%


44
%


50
%Expected term


3.5 years



4.1 years



3.1 yearsRisk-free interest rate


3.63
%


4.81
%


4.23
%Expected dividend yield


0
%


0
%


0
%    74




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)    Recent Accounting Developments
       75




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   1.
    Summary
    of Significant Accounting
    Policies  (Continued)    2. Business
    Combinations
       76




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
  3. Accounts
    and Notes Receivable
    December 28,


December 29,2007


2006From long-term contracts:Amounts billed due within one year

$
548,290


$
467,268Billed retention:Estimated to be due in:2007






10,0822008


16,557



1,9622009


4,141



5,6002010


19,749



3,4812011


2,068



2012


1,000



Total billed retention


43,515



21,125Total receivables from long-term contracts


591,805



488,393Other trade accounts and notes receivable


1,476



3,274Trade accounts and notes receivable, gross


593,281



491,667Less: allowance for doubtful accounts


(12,398
)


(7,848
)Trade accounts and notes receivable, net

$
580,883


$
483,819     December 28,


December 29,2007


2006Asbestos insurance receivable

$
50,076


$
49,191Foreign refundable value-added tax


25,071



13,804Other


23,561



20,502Other accounts and notes receivable

$
98,708


$
83,497    4. Land,
    Buildings and Equipment
    December 28,


December 29,2007


2006Land and land improvements

$
25,548


$
23,394Buildings


154,753



142,931Furniture, fixtures and equipment


541,091



490,700Construction in progress


13,007



783Land, buildings and equipment, gross


734,399



657,808Less: accumulated depreciation


(396,914
)


(355,320
)Land, buildings and equipment, net

$
337,485


$
302,488  77




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   4. Land,
    Buildings and
    Equipment  (Continued)
      5. Equity
    Interests
  waste-to-energy waste-to-energy
  December 28, 2007


December 29, 2006Italian


Chilean


Italian


ChileanProjects


Project


Projects


ProjectBalance Sheet Data:Current assets

$
294,482


$
49,353


$
199,606


$
27,013Other assets (primarily buildings and equipment)


656,796



146,665



536,543



156,236Current liabilities


72,009



21,044



42,134



18,226Other liabilities (primarily long-term debt)


576,545



81,696



470,618



88,836Net assets


302,724



93,278



223,397



76,187   For the Year EndedDecember 28, 2007


December 29, 2006


December 30, 2005Italian


Chilean


Italian


Chilean


Italian


ChileanProjects


Project


Projects


Project


Projects


ProjectIncome Statement Data:Total revenues

$
319,611


$
70,427


$
304,786


$
43,462


$
293,588


$
39,659Gross profit


75,549



42,234



72,070



21,198



65,419



19,725Income before income taxes


59,402



35,391



69,096



15,012



52,646



10,031Net earnings


45,684



30,258



41,365



16,025



46,070



7,782    78




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   5. Equity
    Interests  (Continued)
                6. Equity-for-Debt
    Exchanges
     79




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   6. Equity-for-Debt
    Exchanges  (Continued)
      7. Long-term
    Debt
    December 28, 2007


December 29, 2006Current


Long-term


Total


Current


Long-term


TotalCapital Lease Obligations

$
1,318


$
67,095


$
68,413


$
1,537


$
65,319


$
66,856Special-Purpose Limited Recourse Project Debt:Camden County Energy Recovery Associates


9,648



31,779



41,427



9,360



41,427



50,787FW Power






45,041



45,041



4,881



24,862



29,743Energia Holdings, LLC


4,144



21,101



25,245



3,613



25,245



28,858Subordinated Robbins Facility Exit Funding Obligations:1999C Bonds at 7.25% interest, due October 15, 2009


18



19



37



16



37



531999C Bonds at 7.25% interest, due October 15, 2024






20,491



20,491







20,491



20,4911999D Accretion Bonds at 7% interest, due October 15, 2009






286



286







267



267Intermediate Term Loans in China at 7.02% interest


4,107







4,107







3,844



3,844Convertible Subordinated Notes at 6.50% interest, due
    June 1, 2007














2,070







2,070Other


133



166



299











Total

$
19,368


$
185,978


$
205,346


$
21,477


$
181,492


$
202,969   Domestic Senior Credit Agreement
 80




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   7. Long-term
    Debt  (Continued)
  and/or
    and/or
      Prior Domestic enior Credit Agreement
  Capital Lease Obligations
  December 28,


December 29,2007


2006Buildings and improvements

$
48,565


$
45,650Less: accumulated amortization


(11,462
)


(9,272
)Net assets under capital lease obligations

$
37,103


$
36,378  81




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   7. Long-term
    Debt  (Continued)
    Fiscal year:2008

$
8,5642009


8,6572010


8,4032011


8,7512012


8,174Thereafter


102,393Less: interest


(76,529
)Net minimum lease payments under capital lease obligations


68,413Less: current portion of net minimum lease payments


(1,318
)Long-term portion of net minimum lease payments

$
67,095   Special-Purpose Limited Recourse Project Debt waste-to-energy and/or
  waste-to-energy
  6-month 6-month
  6-month
   82




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   7. Long-term
    Debt  (Continued)
      Subordinated Robbins Facility Exit Funding Obligations
    (Robbins bonds) waste-to-energy
    Intermediate Term Loans in China at 7.02% interest
    (intermediate term loans)
  Convertible Subordinated Notes at 6.50% interest, due
    June 1, 2007 (convertible
    notes)
  Interest Costs
 83




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   7. Long-term
    Debt  (Continued)
  Aggregate Maturities
  Fiscal Year2008


2009


2010


2011


2012


Thereafter


TotalSpecial-Purpose Limited Recourse Project Debt:Camden County Energy Recovery Associates

$
9,648


$
9,914


$
21,865


$



$



$



$
41,427FW Power






4,795



5,273



5,257



5,683



24,033



45,041Energia Holdings, LLC


4,144



4,675



3,188



2,019



1,913



9,306



25,245Subordinated Robbins Facility Exit Funding Obligations:1999C Bonds at 7.25% interest, due October 15, 2009


18



19



















371999C Bonds at 7.25% interest, due October 15, 2024






















20,491



20,4911999D Accretion Bonds at 7% interest, due October 15, 2009






286



















286Intermediate Term Loans in China at 7.02% interest


4,107























4,107Other


133



133



33















299Total

$
18,050


$
19,822


$
30,359


$
7,276


$
7,596


$
53,830


$
136,933    8. Pensions
    and Other Postretirement Benefits
      Defined Benefit Pension Plans
 84




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   8. Pensions
    and Other Postretirement
    Benefits  (Continued)
  Defined
    benefit pension obligations and funded status:
  For the Year Ended December 28, 2007


For the Year Ended December 29, 2006United


United








United


UnitedStates


Kingdom


Other


Total


States


Kingdom


Other


TotalChange in projected benefit obligations:Projected benefit obligations at beginning of year

$
336,496


$
876,686


$
34,175


$
1,247,357


$
349,993


$
710,877


$
35,350


$
1,096,220Service cost






14,073



620



14,693







15,590



951



16,541Interest cost


19,031



45,348



1,671



66,050



18,578



36,079



1,684



56,341Plan participants contributions






8,123







8,123







7,518







7,518Plan amendments






















33,600







33,600Actuarial loss/(gain)


(5,690
)


(19,912
)


344



(25,258
)


(9,697
)


504



(1,621
)


(10,814
)Benefits paid


(23,026
)


(36,507
)


(3,307
)


(62,840
)


(22,378
)


(26,805
)


(2,916
)


(52,099
)Special termination benefits/other






(1,213
)






(1,213
)






(2,147
)


(52
)


(2,199
)Foreign currency exchange rate changes






16,937



5,777



22,714







101,470



779



102,249Projected benefit obligations at end of year


326,811



903,535



39,280



1,269,626



336,496



876,686



34,175



1,247,357Change in plan assets:Fair value of plan assets at beginning of year


283,857



673,131



22,061



979,049



246,490



544,761



20,921



812,172Actual return on plan assets


24,384



47,760



(20
)


72,124



32,250



47,751



2,326



82,327Employer contributions


45,023



32,404



2,857



80,284



27,495



25,699



1,833



55,027Plan participants contributions






8,123







8,123







7,518







7,518Benefits paid


(23,026
)


(36,507
)


(3,307
)


(62,840
)


(22,378
)


(26,805
)


(2,916
)


(52,099
)Other






(1,212
)






(1,212
)






(3,631
)






(3,631
)Foreign currency exchange rate changes






12,929



4,096



17,025







77,838



(103
)


77,735Fair value of plan assets at end of year


330,238



736,628



25,687



1,092,553



283,857



673,131



22,061



979,049Funded status at end of year

$
3,427


$
(166,907
)

$
(13,593
)

$
(177,073
)

$
(52,639
)

$
(203,555
)

$
(12,114
)

$
(268,308
)     December 28,


December 29,2007


2006Other assets

$
3,839


$
Current liabilities


(730
)


(764
)Non-current liabilities


(180,182
)


(267,544
)Funded status at end of year

$
(177,073
)

$
(268,308
)     December 28,


December 29,2007


2006Net actuarial loss

$
347,580


$
394,390Prior service cost


33,417



38,631Net transition asset


(112
)


(85
)Total

$
380,885


$
432,936  85




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   8. Pensions
    and Other Postretirement
    Benefits  (Continued)
    Accumulated
    benefit obligation:
    Information
    for defined benefit pension plans with an accumulated benefit
    obligation in excess of plan assets:
  December 28,


December 29,2007(1)


2006Projected benefit obligation

$
934,211


$
1,238,840Accumulated benefit obligation


761,967



1,130,135Fair value of plan assets


749,912



968,524     (1)
    
    Information for the U.S. plans as of December 28, 2007 has
    not been included since plan assets exceed the accumulated
    benefit obligation.  Components
    of net periodic benefit cost and other changes recognized in
    other comprehensive income/(loss):
  For the Year Ended


For the Year Ended


For the Year EndedDecember 28, 2007


December 29, 2006


December 30, 2005United States


United Kingdom


Other


Total


United States


United Kingdom


Other


Total


United States


United Kingdom


Other


TotalNet periodic benefit cost:Service cost

$



$
14,073


$
620


$
14,693


$



$
15,590


$
951


$
16,541


$



$
16,274


$
1,040


$
17,314Interest cost


19,031



45,348



1,671



66,050



18,578



36,079



1,684



56,341



18,579



31,953



1,856



52,388Expected return on plan assets


(22,064
)


(48,200
)


(1,762
)


(72,026
)


(18,125
)


(40,100
)


(1,563
)


(59,788
)


(16,920
)


(35,269
)


(1,412
)


(53,601
)Amortization of transition (asset)/ obligation






(66
)


93



27







(64
)


87



23







(69
)


82



13Amortization of prior service cost






5,195



19



5,214







4,941



17



4,958







1,677



16



1,693Amortization of net actuarial loss


3,285



17,530



479



21,294



4,262



17,239



912



22,413



4,191



14,522



538



19,251SFAS No. 87 net periodic benefit cost


252



33,880



1,120



35,252



4,715



33,685



2,088



40,488



5,850



29,088



2,120



37,058SFAS No. 88 cost*






















276



21



297



56







(346
)


(290
)Total net periodic benefit cost

$
252


$
33,880


$
1,120


$
35,252


$
4,715


$
33,961


$
2,109


$
40,785


$
5,906


$
29,088


$
1,774


$
36,768Changes recognized in other comprehensive income/(loss):Net actuarial (gain)/loss

$
(8,008
)

$
(19,435
)

$
1,927


$
(25,516
)

$



$



$



$



$



$



$



$
Amortization of transition asset/ (obligation)






66



(93
)


(27
)






























Amortization of prior service cost






(5,195
)


(19
)


(5,214
)






























Amortization of net actuarial loss


(3,285
)


(17,530
)


(479
)


(21,294
)






























Total income recognized in other comprehensive income/(loss)

$
(11,293
)

$
(42,094
)

$
1,336


$
(52,051
)

$



$



$



$



$



$



$



$
Weighted-average assumptions-net periodic benefit cost:Discount rate


5.81
%


5.14
%


4.50
%






5.45
%


4.86
%


4.60
%






5.48
%


5.44
%


5.03
%Long-term rate of return


8.00
%


6.94
%


7.50
%






8.00
%


6.84
%


7.50
%






8.00
%


7.32
%


7.50
%Salary growth


N/A



3.83
%


2.35
%






N/A



3.84
%


3.21
%






N/A



3.33
%


2.95
%Weighted-average assumptions-projected benefit obligations:Discount rate


6.31
%


5.72
%


5.30
%






5.80
%


5.13
%


4.69
%Salary growth


N/A



4.12
%


3.47
%






N/A



3.82
%


3.39
%     *
    
    Charges were recorded in accordance
    with the provisions of SFAS No. 88, Accounting
    for Settlements and Curtailments of Defined Benefit Pension
    Plans and for Termination Benefits, related to the
    settlement of obligations to former employees in the United
    Kingdom and Canada of $297 in 2006; and the settlement of
    obligations to former employees in Finland and to former
    executives under the Supplemental Executive Retirement Plan
    (SERP) of $(290) in 2005. 86




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   8. Pensions
    and Other Postretirement
    Benefits  (Continued)
   Investment
    policy:
          Long-term
    rate of return assumptions:
    For the Year EndedDecember 28,


December 29,2007


2006Asset allocation by plan:United States:Equities


70
%


71
%Fixed-income securities


30
%


29
%Total


100
%


100
%United Kingdom:Equities


59
%


61
%Fixed-income securities


41
%


36
%Other


0
%


3
%Total


100
%


100
%Canada:Equities


49
%


51
%Fixed-income securities


44
%


43
%Other


7
%


6
%Total


100
%


100
%  87




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   8. Pensions
    and Other Postretirement
    Benefits  (Continued)
  Contributions:
    Estimated
    future benefit payments:
    UnitedUnited States


Kingdom


Other


Total2008

$
22,851


$
30,502


$
3,583


$
56,9362009


23,003



32,423



3,358



58,7842010


23,149



33,016



3,971



60,1362011


23,308



34,998



3,959



62,2652012


23,703



40,577



3,083



67,3632013-2017


121,581



208,229



17,898



347,708   Other Postretirement Benefit Plans
   88




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   8. Pensions
    and Other Postretirement
    Benefits  (Continued)
  Other
    postretirement benefit obligation and funded status:
  For the Year EndedDecember 28,


December 29,2007


2006Change in accumulated postretirement benefit obligation:Accumulated postretirement benefit obligation at beginning of
    year

$
96,847


$
101,215Service cost


139



157Interest cost


4,765



5,334Plan participants contributions


2,727



2,868Actuarial (gain)/loss


(13,354
)


(1,943
)Benefits paid


(12,176
)


(11,755
)Medicare Part D reimbursement


1,052



993Other






(24
)Foreign currency exchange rate changes


160



2Accumulated postretirement benefit obligation at end of year


80,160



96,847Change in plan assets:Fair value of plan assets at beginning of year






Plan participants contributions


2,727



2,868Employer contributions


8,397



7,894Medicare Part D reimbursement


1,052



993Benefits paid


(12,176
)


(11,755
)Fair value of plan assets at end of year






Funded status at end of year

$
(80,160
)

$
(96,847
)     December 28,


December 29,2007


2006Current liabilities

$
(7,412
)

$
(8,416
)Non-current liabilities


(72,748
)


(88,431
)Funded status at end of year

$
(80,160
)

$
(96,847
)     December 28,


December 29,2007


2006Net actuarial loss

$
10,949


$
25,253Prior service credit


(43,547
)


(48,309
)Total

$
(32,598
)

$
(23,056
)    89




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   8. Pensions
    and Other Postretirement
    Benefits  (Continued)
  Components
    of net periodic postretirement benefit cost and other changes
    recognized in other comprehensive income/(loss):
  For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Net periodic postretirement benefit cost:Service cost

$
139


$
157


$
205Interest cost


4,765



5,334



5,341Amortization of prior service credit


(4,762
)


(4,761
)


(4,760
)Amortization of net actuarial loss


952



2,049



1,972Net periodic postretirement benefit cost

$
1,094


$
2,779


$
2,758Changes recognized in other comprehensive income/(loss):Net actuarial gain

$
(13,352
)

$



$
Amortization of prior service credit


4,762Amortization of net actuarial loss


(952
)






Total loss recognized in other comprehensive income/(loss)

$
(9,542
)

$



$
Weighted-average assumptions-net periodic postretirement benefit cost:Discount rate


5.73
%


5.39
%


5.35
%Weighted-average assumptions-accumulated postretirement
    benefit obligation:Discount rate


6.20
%


5.73
%   Pre-Medicare


MedicareEligible


EligibleHealth-care cost trend:2007


15.00
%


15.00
%2008


7.50
%


9.00
%Decline to 2016


5.00
%


5.00
%     One-Percentage

One-PercentagePoint Increase

Point DecreaseEffect on total of service and interest cost components

$
201


$
(174
)Effect on accumulated postretirement benefit obligation

$
3,379


$
(2,918
)   Contributions:
   90




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   8. Pensions
    and Other Postretirement
    Benefits  (Continued)
  Estimated
    future other postretirement benefit payments:
    PostretirementPostretirement


Health Care


Benefits,Benefits


Subsidy


Net of Subsidy2008

$
9,022


$
1,411


$
7,6112009


9,074



1,523



7,5512010


9,001



1,633



7,3682011


8,868



1,749



7,1192012


8,641



1,870



6,7712013-2017


40,480



10,359



30,121   Defined Contribution Plans
    Other Benefits
  9. Guarantees
    and Warranties
  and/or and/or
  91




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   9. Guarantees
    and Warranties  (Continued)
  Maximum

Carrying Amount of LiabilityPotential

December 28,

December 29,Payment

2007

2006Environmental indemnifications


No limit


$
6,900


$
7,300Tax indemnifications


No limit


$



$
     For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Balance at beginning of year

$
69,900


$
63,200


$
94,500Accruals


35,800



27,600



24,800Settlements


(5,700
)


(18,600
)


(12,600
)Adjustments to provisions


(12,200
)


(2,300
)


(43,500
)Balance at end of year

$
87,800


$
69,900


$
63,200       10. Financial
    Instruments and Risk Management
    Cash, Cash Equivalents and Restricted Cash
  Long-term Debt
  Foreign Currency Forward Contracts
  Interest Rate Swaps
 92




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   10. Financial
    Instruments and Risk
    Management  (Continued)
  Carrying Amounts and Fair Values
  December 28, 2007


December 29, 2006Carrying


Fair


Carrying


FairAmount


Value


Amount


ValueNon-derivatives:Cash and cash equivalents

$
1,048,544


$
1,048,544


$
610,887


$
610,887Restricted cash


20,937



20,937



19,080



19,080Long-term debt


(205,346
)


(224,416
)


(202,969
)


(220,529
)Derivatives:Foreign currency forward exchange contracts


4,419



4,419



4,095



4,095Interest rate swaps


2,308



2,308



545



545       11. Preferred
    Shares
      12. Share-Based
    Compensation Plans
    Omnibus
    Incentive Plan:
   93




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##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   12. Share-Based
    Compensation Plans  (Continued)
      Prior
    Share-Based Compensation Plans:
         94




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   12. Share-Based
    Compensation Plans  (Continued)
  Stock
    Option Awards:
    For the Year EndedDecember 28, 2007


December 29, 2006


December 30, 2005Weighted-





Weighted-





Weighted-Average





Average





AverageExercise





Exercise





ExerciseShares


Price


Shares


Price


Shares


PriceOptions outstanding at beginning of year


4,411,930


$
20.19



6,568,020


$
14.50



6,442,252


$
15.93Options exercised


(2,976,020
)

$
6.07



(3,046,430
)

$
5.78



(255,890
)

$
4.69Options granted


193,326


$
62.98



991,492


$
23.17



457,016


$
12.48Options canceled or expired


(126,760
)

$
129.20



(101,152
)

$
113.98



(75,358
)

$
157.63Options outstanding at end of year


1,502,476


$
44.45



4,411,930


$
20.19



6,568,020


$
14.50Options available for grant at end of year


8,066,938







8,178,784







1,336,370Weighted-average grant date fair value of options granted during
    the year

$
23.03






$
9.28






$
4.70     Stock Options OutstandingWeighted-Average


Weighted-


AggregateNumber


Remaining


Average


IntrinsicRange of Exercise Prices


Outstanding


Contractual Life


Exercise Price


Value$
11.60


to

$
16.50



90,522



1.63 years


$
13.76


$
5,82719.92


to


21.74



563,040



3.62 years



21.73



31,75825.05


to


28.50



368,406



4.01 years



25.33



19,45446.90


to


56.88



179,176



3.66 years



51.30



4,80867.55


to


81.57



158,050



4.93 years



70.99



1,14890.00


to


116.00



44,500



2.23 years



95.64



135.00


to


150.63



59,182



1.15 years



141.36



275.00


to


276.25



39,600



0.05 years



276.18



$
11.60


to

$
276.25



1,502,476



3.51 years


$
44.45


$
62,995  95




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   12. Share-Based
    Compensation Plans  (Continued)
    Stock Options ExercisableWeighted-Average


Weighted-


AggregateNumber


Remaining


Average


IntrinsicRange of Exercise Prices


Exercisable


Contractual Life


Exercise Price


Value$
11.60


to

$
16.50



90,522



1.63 years


$
13.76


$
5,82719.92


to


21.74



189,654



3.63 years



21.72



10,69925.05


to


28.50



11,702



4.01 years



25.05



62146.90


to


56.88



168,600



3.63 years



51.46



4,49867.55


to


81.57



5,000



2.57 years



81.57



90.00


to


116.00



32,500



2.25 years



94.03



135.00


to


150.63



59,182



1.15 years



141.36



275.00


to


276.25



39,600



0.05 years



276.18



$
11.60


to

$
276.25



596,760



2.77 years


$
62.17


$
21,645       Restricted
    Awards:
    For the Year EndedDecember 28, 2007


December 29, 2006


December 30, 2005Weighted-





Weighted-





Weighted-Average





Average





AverageGrant





Grant





GrantShares


Price


Shares


Price


Shares


PriceNon-vested at beginning of year


659,262


$
11.32



2,222,362


$
4.76



2,703,678


$
4.60Granted





$




248,940


$
21.47



34,832


$
14.65Vested


(493,302
)

$
7.91



(1,807,088
)

$
4.67



(516,148
)

$
4.60Canceled or forfeited





$




(4,952
)

$
4.60






$
Non-vested at end of year


165,960


$
21.47



659,262


$
11.32



2,222,362


$
4.76  96




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   12. Share-Based
    Compensation Plans  (Continued)
    For the Year EndedDecember 28, 2007


December 29, 2006


December 30, 2005Weighted-





Weighted-





Weighted-Average





Average





AverageGrant





Grant





GrantUnits


Price


Units


Price


Units


PriceNon-vested at beginning of year


868,968


$
9.30



1,157,096


$
5.09



1,099,890


$
4.70Granted


82,258


$
62.94



193,412


$
25.00



57,206


$
12.58Vested


(686,818
)

$
5.12



(452,674
)

$
5.48






$
Canceled or forfeited


(36,978
)

$
25.05



(28,866
)

$
5.62






$
Non-vested at end of year


227,430


$
38.79



868,968


$
9.30



1,157,096


$
5.09     13. Common
    Share Purchase Warrants
           97




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   13. Common
    Share Purchase
    Warrants  (Continued)
  45-day 12-month
  14. Accumulated
    Other Comprehensive Loss
    Accumulated





Pension and OtherForeign


Minimum


Postretirement


Net Gains onCurrency


Pension Liability


Benefit Plan


Derivatives DesignatedTranslation


Adjustments, Net


Adjustments, Net of


as Cash Flow Hedges,


Accumulated OtherAdjustments


of Tax


Tax


Net of Tax


Comprehensive LossBalance as of December 31, 2004

$
(51,240
)

$
(245,503
)

$



$



$
(296,743
)Other comprehensive income/(loss)


(22,928
)


4,875











(18,053
)Balance as of December 30, 2005


(74,168
)


(240,628
)










(314,796
)Other comprehensive income


31,612



40,087







342



72,041Adoption of SFAS No. 158






200,541



(301,128
)






(100,587
)Balance as of December 29, 2006


(42,556
)






(301,128
)


342



(343,342
)Other comprehensive income


31,939







48,958



1,331



82,228Balance as of December 28, 2007

$
(10,617
)

$



$
(252,170
)

$
1,673


$
(261,114
)      98




---



##### Table of Contents



FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
  15. Income
    Taxes
    For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Domestic

$
23,727


$
68,897


$
(229,379
)Foreign


506,567



274,796



159,198Total

$
530,294


$
343,693


$
(70,181
)     For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Current tax expense:Domestic

$
(2,831
)

$
(4,084
)

$
(5,266
)Foreign


(114,938
)


(55,260
)


(28,902
)Total current


(117,769
)


(59,344
)


(34,168
)Deferred tax expense:Domestic


(2,248
)


(3,540
)


(2,845
)Foreign


(16,403
)


(18,825
)


(2,555
)Total deferred


(18,651
)


(22,365
)


(5,400
)Total provision for income taxes

$
(136,420
)

$
(81,709
)

$
(39,568
)  99




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   15. Income
    Taxes  (Continued)
    December 28,


December 29,2007


2006Deferred tax assets:Pensions

$
46,484


$
86,219Accrued costs on long-term contracts


22,919



27,631Deferred income


25,392



22,713Accrued expenses


43,546



46,364Postretirement benefits other than pensions


27,318



33,807Asbestos claims


32,790



43,493Net operating loss carryforwards and other tax attributes


224,457



160,905Asset impairments and other reserves


2,079



2,247Other


5,159



2,922Total gross deferred tax assets


430,144



426,301Valuation allowance


(294,286
)


(282,104
)Total deferred tax assets


135,858



144,197Deferred tax liabilities:Property, plant and equipment


(27,372
)


(24,038
)Goodwill and other intangible assets


(19,791
)


(15,739
)Investments


(25,845
)


(18,180
)Unremitted earnings of foreign subsidiaries


(8,000
)


(8,091
)Total gross deferred tax liabilities


(81,008
)


(66,048
)Net deferred tax assets

$
54,850


$
78,149   and/or
  non-U.S. jurisdictions
 100




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   15. Income
    Taxes  (Continued)
  12-month non-U.S. income
        Balance at beginning of year

$
44,786Additions based on tax positions related to the current year


6,218Additions for tax positions of prior years


8,910Reductions for tax provisions for prior years


(1,663
)Settlements


(2,744
)Reductions for lapse of statute of limitations


(3,332
)Balance at end of year

$
52,175      101




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   15. Income
    Taxes  (Continued)
    For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Tax provision/(benefit) at U.S. statutory rate


35.0
%


35.0
%


(35.0
)%State income taxes, net of Federal income tax benefit


0.1
%


0.3
%


5.1
%U.S. tax on foreign earnings


0.0
%


0.0
%


32.8
%Valuation allowance


(1.8
)%


(3.9
)%


30.3
%Foreign tax rates different than the statutory rate


(10.4
)%


(9.3
)%


(7.6
)%Impact of changes in tax rate on deferred tax


1.3
%


0.0
%


0.0
%Nondeductible loss


1.6
%


1.7
%


30.6
%Other


(0.1
)%


0.0
%


0.2
%Total


25.7
%


23.8
%


56.4
%    16. Derivative
    Financial Instruments
    For the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Decrease/(increase) in cost of operating revenues

$
465


$
7,662


$
(3,711
)Other deductions


(141
)


(52
)


(222
)Pretax gain/(loss)

$
324


$
7,610


$
(3,933
)        102




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   16. Derivative
    Financial
    Instruments  (Continued)
      17. Business
    Segments
  Global
    Engineering and Construction Group Global Power Group
    2 2 2 2
 103




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   17. Business
    Segments  (Continued)
          Global E&C Group


Global Power Group


TotalPercentage of





Percentage of





Percentage ofThird-Party


Third-Party


Third-Party


Third-Party


Third-Party


Third-PartyRevenues


Revenues


Revenues


Revenues


Revenues


RevenuesNorth America

$
253,952



6.9
%

$
703,342



49.3
%

$
957,294



18.7
%South America


69,922



2.0
%


70,690



5.0
%


140,612



2.8
%Europe


851,961



23.1
%


478,010



33.5
%


1,329,971



26.0
%Asia


800,110



21.7
%


163,896



11.5
%


964,006



18.9
%Middle East


1,001,193



27.2
%


5,094



0.4
%


1,006,287



19.7
%Other


704,121



19.1
%


4,952



0.3
%


709,073



13.9
%Total

$
3,681,259



100.0
%

$
1,425,984



100.0
%

$
5,107,243



100.0
%      104




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   17. Business
    Segments  (Continued)
    Global


Global


C&FTotal


E&C Group


Power Group


Group(1)For the Year Ended December 28, 2007Third-party revenues

$
5,107,243


$
3,681,259


$
1,425,984


$
EBITDA(2)

$
591,840


$
505,647


$
139,177


$
(52,984
)Less: Interest expense


(19,855
)Less: Depreciation and amortization


(41,691
)Income before income taxes


530,294Provision for income taxes


(136,420
)Net income

$
393,874Total assets

$
3,248,988


$
1,799,231


$
1,243,696


$
206,061Capital expenditures

$
51,295


$
42,965


$
8,055


$
275For the Year Ended December 29, 2006Third-party revenues

$
3,495,048


$
2,219,104


$
1,275,944


$
EBITDA(3)

$
399,514


$
323,297


$
95,039


$
(18,822
)Less: Interest expense


(24,944
)Less: Depreciation and amortization


(30,877
)Income before income taxes


343,693Provision for income taxes


(81,709
)Net income

$
261,984Total assets

$
2,565,549


$
1,397,428


$
980,756


$
187,365Capital expenditures

$
30,293


$
22,784


$
7,464


$
45For the Year Ended December 30, 2005Third-party revenues

$
2,199,955


$
1,471,948


$
728,024


$
(17
)EBITDA(4)

$
8,652


$
165,629


$
107,266


$
(264,243
)Less: Interest expense


(50,618
)Less: Depreciation and amortization


(28,215
)Loss before income taxes


(70,181
)Provision for income taxes


(39,568
)Net loss

$
(109,749
)Capital expenditures

$
10,809


$
6,856


$
3,642


$
311     (1)
    
    Includes general corporate income and expense, our captive
    insurance operation and eliminations.(2)
    
    Includes in fiscal year 2007: increased/(decreased) contract
    profit of $35,150 from the regular re-evaluation of contract
    profit estimates: $54,520 in our Global E&C Group and
    $(19,370) in our Global Power Group; 105




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   17. Business
    Segments  (Continued)
  a charge of $(7,374) in our C&F Group reflecting the
    revaluation of our asbestos liability and related asset
    resulting primarily from increased asbestos defense costs
    projected through year-end 2022 and for the addition of another
    year to our rolling
    15-year
    asbestos liability estimate; and gains of $13,519 on the
    settlement of coverage litigation with certain asbestos
    insurance carriers recorded in our C&F Group.(3)
    
    Includes in fiscal year 2006: increased/(decreased) contract
    profit of $(5,670) from the regular re-evaluation of contract
    profit estimates: $14,720 in our Global E&C Group and
    $(20,390) in our Global Power Group; a charge of $(15,533) in
    our C&F Group reflecting the revaluation of our asbestos
    liability and related asset; net asbestos-related gains of
    $115,664 recorded in our C&F Group primarily from
    settlement of coverage litigation with certain asbestos
    insurance carriers; an aggregate charge of $(14,955) recorded in
    our C&F Group in conjunction with the voluntary termination
    of our prior domestic senior credit agreement; and a net charge
    of $(12,483) recorded in our C&F Group in conjunction with
    the debt reduction initiatives completed in April and May 2006.(4)
    
    Includes in fiscal year 2005: increased contract profit of
    $99,555 from the regular re-evaluation of contract profit
    estimates: $66,274 in our Global E&C Group and $33,281 in
    our Global Power Group; a charge of $(113,680) in our C&F
    Group on the revaluation of our estimated asbestos liability and
    asbestos insurance receivable; credit agreement costs in our
    C&F Group associated with the prior senior credit facility
    of $(3,500); and an aggregate charge of $(58,346) in our
    C&F Group recorded in conjunction with the exchange offers
    for the trust preferred securities and the 2011 senior notes.  For the Year EndedDecember 28,


December 29,


December 30,Equity in Earnings of Unconsolidated Subsidiaries:

2007


2006


2005Global E&C Group

$
19,720


$
19,056


$
24,527Global Power Group


17,579



10,551



5,409C&F Group






(328
)


(88
)Total

$
37,299


$
29,279


$
29,848   December 28,


December 29,Investments In and Advances to Unconsolidated
    Subsidiaries:

2007


2006Global E&C Group

$
130,240


$
105,773Global Power Group


68,092



61,405C&F Group


14



8Total

$
198,346


$
167,186  106




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   17. Business
    Segments  (Continued)
    For the Year EndedDecember 28,


December 29,


December 30,Geographic Concentration of Third-Party Revenues:

2007


2006


2005United States

$
1,091,584


$
931,701


$
451,532Europe


3,412,606



2,286,205



1,557,965Canada


21,220



11,588



13,508Asia


568,164



253,457



164,705South America


13,669



12,097



12,262Other, net of eliminations










(17
)Total

$
5,107,243


$
3,495,048


$
2,199,955     December 28,


December 29,Long-Lived Assets:

2007


2006United States

$
213,901


$
225,373Europe


306,631



235,781Canada


25



433Asia


30,945



28,141South America


66,673



60,242Other, net of eliminations


32,191



33,281Total

$
650,366


$
583,251     For the Year EndedDecember 28,


December 29,


December 30,Third-Party Revenues by Industry:

2007


2006


2005Power generation

$
1,437,078


$
1,326,896


$
915,786Oil refining


1,431,810



716,053



444,830Pharmaceutical


155,266



128,510



149,867Oil and gas


898,623



680,041



327,058Chemical/petrochemical


1,003,136



383,092



228,971Power plant operation and maintenance


120,474



111,154



116,303Environmental


54,878



68,847



43,346Other, net of eliminations


5,978



80,455



(26,206
)Total

$
5,107,243


$
3,495,048


$
2,199,955    18. Operating
    Leases
   107




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   18. Operating
    Leases  (Continued)
    Fiscal year:2008

$
52,8022009


44,7012010


40,5912011


35,8102012


30,824Thereafter


229,093Total

$
433,821     19. Litigation
    and Uncertainties
  Asbestos
    United
    States
    Number of ClaimsFor the Year EndedDecember 28,


December 29,


December 30,2007


2006


2005Open claims at beginning of year


135,890



164,820



167,760New claims


5,140



8,250



14,340Claims resolved(1)


(9,690
)


(37,180
)


(17,280
)Open claims at end of year


131,340



135,890



164,820Claims not valued in the liability(2)


(66,040
)


(47,820
)


(62,560
)Open claims valued in the liability at end of year


65,300



88,070



102,260     (1)
    
    Claims resolved in fiscal year 2006
    include court dismissals without payment of mass claim filings
    approximating 22,900 claims.(2)
    
    Claims not valued in the liability
    include claims on certain inactive court dockets, claims over
    six years old that are considered abandoned and certain other
    items. 108




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
           December 28,


December 29,2007


2006Asbestos-related assets recorded within:Accounts and notes receivable-other

$
47,100


$
47,000Asbestos-related insurance recovery receivable


279,100



316,700Total asbestos-related assets

$
326,200


$
363,700Asbestos-related liabilities recorded within:Accrued expenses

$
72,000


$
75,000Asbestos-related liability


331,300



391,000Total asbestos-related liabilities

$
403,300


$
466,000      109




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
    and/or
             110




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
                 111




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
    United
    Kingdom
      Project
    Claims
    Compact
    CFB Boiler Arbitration  Asia
   112




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
  Thermal
    Electric Power Plant Arbitration  South
    America
    Power
    Plant Arbitration  Eastern Europe
    Power
    Plant Dispute  Ireland
   113




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
  and/or
             114




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
    Camden
    County Waste-to-Energy Project
          Environmental
    Matters
  CERCLA
    and Other Remedial Matters
   115




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
    and/or
  and/or and/or and/or
    Mountain
    Top
       116




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
    and/or and/or and/or
    Sarah Martin and Jeffrey Martin v. Foster Wheeler Energy
    Corporation No. 3376-06,
  Martin
    Donna Rose Cunningham and Michael A. Cunningham v.
    Foster Wheeler Energy Corporation Martin
 117




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   19. Litigation
    and Uncertainties  (Continued)
    Gary
    Prezkop, Personal Representative of the Estate of Mary Prezkop,
    Deceased, and Gary Prezkop, in his own right, v. Foster
    Wheeler Energy Corporation and Leonard M. Lulis. , Martin Cunningham
  Other
    Environmental Matters
     118




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
  20. Quarterly
    Financial Data (Unaudited)
  Three Months EndedDecember 28,


September 28,


June 29,


March 30,2007


2007


2007


2007Operating revenues

$
1,465,483


$
1,299,872


$
1,189,766


$
1,152,122Contract profit


170,003



197,960



168,846



207,512Net income


78,098
(1)


129,101



71,850



114,825Net income attributable to common shareholders


78,098



129,101



71,850



114,825Earnings per common share:Basic

$
0.54


$
0.91


$
0.51


$
0.82Diluted

$
0.54


$
0.89


$
0.50


$
0.80Shares outstanding:Weighted-average number of common shares outstanding for basic
    earnings per common share


143,540,329



142,517,528



141,078,576



139,507,752Effect of dilutive securities


1,615,072



2,574,936



3,543,466



4,023,304Weighted-average number of common shares outstanding for diluted
    earnings per common share


145,155,401



145,092,464



144,622,042



143,531,056   Three Months EndedDecember 29,


September 29,


June 30,


March 31,2006


2006


2006


2006Operating revenues

$
1,193,319


$
910,580


$
745,307


$
645,842Contract profit


170,338



129,189



127,942



80,318Net income


63,108



75,827



108,418



14,631Net income/(loss) attributable to common shareholders


63,108



75,827



108,418



(4,814
)(2)Earnings/(loss) per common share:Basic

$
0.46


$
0.56


$
0.81


$
(0.04
)(2)Diluted

$
0.44


$
0.53


$
0.77


$
(0.04
)(2)Shares outstanding:Weighted-average number of common shares outstanding for basic
    earnings/(loss) per common share


136,755,348



135,421,456



133,669,862



126,138,872Effect of dilutive securities


6,139,370



6,821,720



7,698,976



*Weighted-average number of common shares outstanding for diluted
    earnings/(loss) per common share


142,894,718



142,243,176



141,368,838



126,138,872     *
    
    The impact of potentially dilutive securities such as options to
    purchase common shares, warrants to purchase common shares and
    the non-vested portion of restricted awards were not included in
    the calculation of diluted loss per common share in loss periods
    due to their antidilutive effect. 119




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FOSTER
    WHEELER LTD. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands of dollars, except share data and per share
    amounts)
   20. Quarterly
    Financial Data
    (Unaudited)  (Continued)
   (1)
    
    Net income for the quarter ended December 28, 2007 includes
    a charge of $7,374 reflecting the revaluation of our asbestos
    liability and related asset resulting primarily from increased
    asbestos defense costs projected through year-end 2022 and for
    the addition of another year to our rolling
    15-year
    asbestos liability estimate and a net gain of $4,886 on the
    settlement of coverage litigation with certain asbestos
    insurance carriers.(2)
    
    As discussed in the Earnings per Common Share
    section of Note 1, the fair value of the additional shares
    issued as part of the warrant offer transactions, which were
    consummated in January 2006, reduced net income attributable to
    the common shareholders when calculating earnings/(loss) per
    common share. The fair value of the additional shares issued was
    $19,445. 120




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Foster
    Wheeler Ltd.
  Schedule II:
    Valuation and Qualifying Accounts
 (amounts in thousands)
  For the Year Ended December 28, 2007Additions


AdditionsBalance at


Charged to


Charged to





Balance at theBeginning of


Costs and


Other





End of theYear


Expenses


Accounts


Deductions


YearDescriptionAllowance for doubtful accounts

$
7,848


$
6,109


$



$
(1,559
)

$
12,398Deferred tax valuation allowance

$
282,104


$
1,186


$
24,255


$
(13,259
)

$
294,286   For the Year Ended December 29, 2006Additions


AdditionsBalance at


Charged to


Charged to





Balance at theBeginning of


Costs and


Other





End of theYear


Expenses


Accounts


Deductions


YearDescriptionAllowance for doubtful accounts

$
10,379


$
2,317


$



$
(4,848
)

$
7,848Deferred tax valuation allowance

$
260,101


$
82,136


$
3,176


$
(63,309
)

$
282,104   For the Year Ended December 30, 2005Additions


AdditionsBalance at


Charged to


Charged to





Balance at theBeginning of


Costs and


Other





End of theYear


Expenses


Accounts


Deductions


YearDescriptionAllowance for doubtful accounts

$
23,199


$
3,006


$
157


$
(15,983
)

$
10,379Deferred tax valuation allowance

$
234,432


$
71,838


$
11,474


$
(57,643
)

$
260,101  121




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ITEM 9. CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE   ITEM 9A. CONTROLS
    AND PROCEDURES  Disclosure
    Controls and Procedures
    Rules 13a-15(e) 15d-15(e) Rule 13a-15.
  Managements
    Report on Internal Control Over Financial
    Reporting
  Rule 13a-15(f). Internal Control 
    Integrated Framework Internal
    Control  Integrated Framework
    Form 10-K,
  Changes
    in Internal Control Over Financial Reporting
   ITEM 9B. OTHER
    INFORMATION   122




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PART III ITEM 10. DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE    Code of
    Business Conduct and Ethics
  www.fwc.com/corpgov www.fwc.com/corpgov Form 8-K,
  08809-4000.
 ITEM 11. EXECUTIVE
    COMPENSATION   ITEM 12. SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS    Equity
    Compensation Plan Information
   123




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##### Table of Contents



Weighted-Average


Number of Securities RemainingNumber of Securities to


Exercise Price of


Available for Future Issuancebe Issued Upon Exercise


Outstanding


Under Equity Compensation Plansof Outstanding Options,


Options, Warrants


(excluding securities reflectedWarrants and Rights


and Rights ($)


in column (a))Plan Category

(a)


(b)


(c)Equity Compensation PlansApproved by Security Holders:Omnibus Incentive Plan


1,486,962


$
30.43



8,066,9381995 Stock Option Plan


192,428


$
128.89



Directors Stock Option Plan


14,100


$
119.93



Directors Deferred Compensation Program





$
0.00



Equity Compensation PlansNot Approved by Security Holders:Raymond J. Milchovich
    (1)


130,000


$
49.85



M.J. Rosenthal & Associates, Inc.
    (2)


25,000


$
18.80



2004 Stock Option Plan
    (3)


72,376


$
13.10



Total


1,920,866


$
41.46



8,066,938     (1)
    
    Under the terms of his employment agreement, dated
    October 22, 2001, Mr. Milchovich received an option to
    purchase 130,000 of our common shares on October 22, 2001.
    This option was granted at an exercise price of $49.85 and
    vested 20% each year over the five-year term of the agreement.
    The option exercise price is equal to the median of the high and
    low price of our common shares on the grant date. The option has
    a term of 10 years from the date of grant.(2)
    
    Under the terms of the consulting agreement with M.J.
    Rosenthal & Associates, Inc. on May 7, 2002, we
    granted a nonqualified stock option to purchase 25,000 of our
    common shares at a price of $18.80 with a term of 10 years
    from the date of grant. The exercise price is equal to the mean
    of the high and low price of our common shares on the date of
    grant. The option is exercisable on or after March 31,
    2003. The option, to the extent not then exercised, shall
    terminate upon any breach of certain covenants contained in the
    consulting agreement.(3)
    
    Under the terms of the 2004 Stock Option Plan, adopted by the
    Board of Directors in September 2004, one of our senior
    executives was granted options to purchase 338,000 common shares
    at an exercise price of $11.60 per common share on
    August 8, 2005. Such options expire on August 7, 2008.
    One-third of the options vested in the fourth quarter of 2005
    and the balance vested during the fourth quarter of 2006. As of
    December 28, 2007, options to purchase 40,000 common shares
    at an exercise price of $11.60 per common share remained
    outstanding.On October 10, 2005, one of our senior executives was
    granted options under the 2004 Stock Option Plan to purchase
    104,330 common shares at an exercise price of $14.975 per common
    share. Such options expire on October 9, 2008. One-third of
    the options vested in the fourth quarter of 2005 and the balance
    vested during the fourth quarter of 2006. As of
    December 28, 2007, options to purchase 26,082 common shares
    at an exercise price of $14.975 per common share remained
    outstanding. 124




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##### Table of Contents



On November 8, 2005, our non-employee directors were issued
    options under the 2004 Stock Option Plan to purchase 14,686
    common shares at an exercise price of $14.838 per common share.
    Such options expire on September 30, 2010. The non-employee
    director options vested in one-twelfth increments until fully
    vested on September 30, 2006. As of December 28, 2007,
    options to purchase 6,294 common shares at an exercise price of
    $14.838 per common share remained outstanding. ITEM 13. CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE   ITEM 14. PRINCIPAL
    ACCOUNTANT FEES AND SERVICES   125




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PART IV ITEM 15. EXHIBITS AND
    FINANCIAL STATEMENT SCHEDULES    (1)
    Financial StatementsFinancial Statements  See Item 8 of this
    Report.(2)
    Financial Statement SchedulesSchedule II:  Valuation and Qualifying
    Accounts  See Item 8 of this Report.    (3)
    Exhibits  ExhibitNo.

Exhibits3
.1

Memorandum of Association of Foster Wheeler Ltd. (Filed as
    Annex II to Foster Wheeler Ltd.s
    Form S-4/A
    (File
    No. 333-52468),
    filed on March 9, 2001, and incorporated herein by
    reference.)3
.2

Memoranda of Reduction of Share Capital and Memorandum of
    Increase in Share Capital each dated December 1, 2004.
    (Filed as Exhibit 99.2 to Foster Wheeler Ltd.s
    Form 8-K,
    dated November 29, 2004 and filed on December 2, 2004,
    and incorporated herein by reference.)3
.3

Certificate of Designation relating to Foster Wheeler
    Ltd.s Series B Convertible Preferred Shares, adopted
    on September 24, 2004. (Filed as Exhibit 3.1 to Foster
    Wheeler Ltd.s
    Form 10-Q
    for the quarter ended September 24, 2004, and incorporated
    herein by reference.)3
.4

Bye-Laws of Foster Wheeler Ltd., amended May 9, 2006.
    (Filed as Exhibit 3.2 to Foster Wheeler Ltd.s
    Form 8-K,
    dated May 9, 2006 and filed on May 12, 2006, and
    incorporated herein by reference.)3
.5

Memorandum of Increase of Share Capital dated February 7,
    2008.4
.0

Foster Wheeler Ltd. hereby agrees to furnish copies of
    instruments defining the rights of holders of long-term debt of
    Foster Wheeler Ltd. and its consolidated subsidiaries to the
    Commission upon request.10
.1

Registration Rights Agreement, dated as of September 24,
    2004, by and among Foster Wheeler Ltd., Foster Wheeler LLC, the
    guarantors listed therein and each of the purchasers signatory
    thereto. (Filed as Exhibit 4.5 to Foster Wheeler
    Ltd.s registration statement on
    Form S-4
    (File No. 119841), filed on October 20, 2004, and
    incorporated by reference herein.)10
.2

Waiver of the Registration Rights Agreement, dated as of
    February 2, 2006, by and among Foster Wheeler Ltd., Foster
    Wheeler LLC, on behalf of themselves and the subsidiary
    guarantors and Citigroup Global Capital Markets Inc. (Filed as
    Exhibit 10.13 to Foster Wheeler Ltd.s
    Form 10-K
    for the fiscal year ended December 30, 2005, and
    incorporated herein by reference.)10
.3

Waiver of the Registration Rights Agreement, dated as of
    February 2, 2006, by and among Foster Wheeler Ltd., Foster
    Wheeler LLC, on behalf of themselves and the subsidiary
    guarantors and Merrill Lynch Global Allocation Fund, Inc.,
    Merrill Lynch International Investment Fund-MLIIF Global
    Allocation Fund, Merrill Lynch Variable Series Fund,
    Inc.-Merrill Lynch Global Allocation V.I. Fund, and Merrill
    Lynch Series Funds, Inc.-Global Allocation Strategy
    Portfolio. (Filed as Exhibit 10.14 to Foster Wheeler
    Ltd.s
    Form 10-K
    for the fiscal year ended December 30, 2005, and
    incorporated herein by reference.)10
.4

Credit Agreement, dated September 13, 2006, among Foster
    Wheeler LLC, Foster Wheeler USA Corporation, Foster Wheeler
    North America Corp., Foster Wheeler Energy Corporation, Foster
    Wheeler International Corporation, and Foster Wheeler Inc., as
    Borrowers, the guarantors party thereto, the lenders party
    thereto, BNP Paribas as Administrative Agent, BNP Paribas
    Securities Corp. as Sole Bookrunner and Sole Lead Arranger, and
    Calyon New York Branch as Syndication Agent. (Filed as
    Exhibit 99.1 to Foster Wheeler Ltd.s
    Form 8-K,
    dated September 13, 2006 and filed on September 14,
    2006, and incorporated herein by reference.) 126




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##### Table of Contents



ExhibitNo.

Exhibits10
.5

Amendment No. 1, dated May 4, 2007, to the Credit
    Agreement, dated September 13, 2006, between Foster Wheeler
    LLC, Foster Wheeler USA Corporation, Foster Wheeler North
    America Corp., Foster Wheeler Energy Corporation, Foster Wheeler
    International Corporation, Foster Wheeler Inc., Foster Wheeler
    Ltd., Foster Wheeler Holdings Ltd., the subsidiary guarantors
    party thereto, the lenders party thereto, and BNP Paribas.
    (Filed as Exhibit 10.4 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended March 30, 2007, and incorporated
    herein by reference.)10
.6

Guarantee Facility, dated July 22, 2005, among Foster
    Wheeler Limited, Foster Wheeler Energy Limited, Foster Wheeler
    World Services Limited, Foster Wheeler (G.B.) Limited and The
    Bank of Scotland regarding, among other things, a
    £50,000,000 guarantee facility and a £150,000,000
    forward foreign exchange facility. (Filed as Exhibit 99.1
    to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended September 30, 2005, and incorporated
    herein by reference.)10
.7

Corporate Guarantee, dated July 25, 2005, among Foster
    Wheeler Limited, Foster Wheeler Energy Limited, Foster Wheeler
    World Services Limited, Foster Wheeler (G.B.) Limited and The
    Bank of Scotland. (Filed as Exhibit 99.2 to Foster Wheeler
    Ltd.s
    Form 10-Q
    for the quarter ended September 30, 2005, and incorporated
    herein by reference.)10
.8

Form of Debenture, dated July 25, 2005, issued in favor of
    The Bank of Scotland as Security Trustee. (Filed as
    Exhibit 99.3 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended September 30, 2005, and incorporated
    herein by reference.)10
.9

Lease Agreement, dated as of August 16, 2002, by and among
    Energy (NJ) QRS
    15-10, Inc.
    and Foster Wheeler Realty Services, Inc. (Filed as
    Exhibit 10.15 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended June 28, 2002, and incorporated
    herein by reference.)10
.10

Amendment to the Lease Agreement, dated as of January 6,
    2003, between Energy (NJ) QRS
    15-10, Inc.
    and Foster Wheeler Realty Services, Inc. (Filed as
    Exhibit 10.30 to Foster Wheeler Ltd.s
    Form 10-K
    for the fiscal year ended December 27, 2002, and
    incorporated herein by reference.)10
.11

Amendment No. 2, dated as of April 21, 2003, to the
    Lease Agreement between Energy (NJ) QRS
    15-10, Inc.
    and Foster Wheeler Realty Services, Inc. (Filed as
    Exhibit 10.7 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended March 28, 2003, and incorporated
    herein by reference.)10
.12

Amendment No. 3, dated as of July 14, 2003, to the
    Lease Agreement dated August 16, 2002, between Energy (NJ)
    QRS 15-10,
    Inc. and Foster Wheeler Realty Services, Inc. (Filed as
    Exhibit 10.6 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended June 27, 2003, and incorporated
    herein by reference.)10
.13

Guaranty and Suretyship Agreement, dated as of August 16,
    2002, made by Foster Wheeler LLC, Foster Wheeler Ltd., Foster
    Wheeler Inc., Foster Wheeler International Holdings, Inc. and
    Energy (NJ) QRS
    15-10, Inc.
    (Filed as Exhibit 10.14 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended June 28, 2002 and incorporated herein
    by reference.)10
.14

Deed between Foster Wheeler LLC and Foster Wheeler Realty
    Services, Inc. and CIT Group Inc. (NJ), dated as of
    March 31, 2003. (Filed as Exhibit 10.3 to Foster
    Wheeler Ltd.s
    Form 10-Q
    for the quarter ended March 28, 2003 and incorporated
    herein by reference.)10
.15

Preliminary Agreement for the Sale of Quotas, dated
    January 31, 2006, between Foster Wheeler Italiana S.p.A.,
    Fineldo S.p.A. and MPE S.p.A. (Filed as Exhibit 10.29 to
    Foster Wheeler Ltd.s
    Form 10-K
    for the fiscal year ended December 30, 2005, and
    incorporated herein by reference.)10
.16

Foster Wheeler Inc. Directors Stock Option Plan. (Filed as
    Exhibit 99.1 to Foster Wheeler Ltd.s post effective
    amendment to
    Form S-8
    (Registration
    No. 333-25945-99),
    filed on June 27, 2001, and incorporated herein by
    reference.)10
.17

1995 Stock Option Plan of Foster Wheeler Inc. (as Amended and
    Restated as of September 24, 2002). (Filed as
    Exhibit 10.1 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended September 27, 2002, and incorporated
    herein by reference.)10
.18

Foster Wheeler Annual Executive Short-term Incentive Plan, as
    amended and restated effective January 1, 2006. (Filed as
    Exhibit 10.20 to Foster Wheeler Ltd.s
    Form 10-K
    for the fiscal year ended December 29, 2006, and
    incorporated herein by reference.)10
.19

Foster Wheeler Ltd. 2004 Stock Option Plan. (Filed as
    Exhibit 10.2 to Foster Wheeler Ltd.s
    Form 8-K,
    dated September 29, 2004 and filed on October 1, 2004,
    and incorporated herein by reference.) 127




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ExhibitNo.

Exhibits10
.20

First Amendment to the Foster Wheeler Ltd. 2004 Stock Option
    Plan. (Filed as Exhibit 99.1 to Foster Wheeler Ltd.s
    Form 8-K,
    dated May 13, 2005 and filed on May 16, 2005, and
    incorporated herein by reference.)10
.21

Form of First Amendment to the Foster Wheeler Ltd. 2004 Stock
    Option Plan with respect to non-employee directors. (Filed as
    Exhibit 99.2 to Foster Wheeler Ltd.s
    Form 8-K,
    dated May 13, 2005 and filed on May 16, 2005, and
    incorporated herein by reference.)10
.22

Form of Amended and Restated Notice of Stock Option Grant with
    respect to executive officers, officers and key employees.
    (Filed as Exhibit 99.3 to Foster Wheeler Ltd.s
    Form 8-K,
    dated May 13, 2005 and filed on May 16, 2005, and
    incorporated herein by reference.)10
.23

Foster Wheeler Ltd. Omnibus Incentive Plan. (Filed as
    Exhibit 10.1 to Foster Wheeler Ltd.s
    Form 8-K,
    dated May 9, 2006 and filed on May 12, 2006, and
    incorporated herein by reference.)10
.24

Form of Directors Stock Option Agreement effective
    June 16, 2006 by and between Foster Wheeler Ltd. and each
    of Ralph Alexander, Eugene Atkinson, Diane C. Creel, Robert C.
    Flexon, Stephanie Hanbury-Brown, Joseph J. Melone and James D.
    Woods. (Filed as Exhibit 10.2 to Foster Wheeler Ltd.s
    Form 8-K,
    dated June 14, 2006 and filed on June 16, 2006, and
    incorporated herein by reference.)10
.25

Form of Employee Nonqualified Stock Option Agreement effective
    November 15, 2006 with respect to certain employees and
    executive officers. (Filed as Exhibit 10.1 to Foster
    Wheeler Ltd.s
    Form 8-K,
    dated November 15, 2006 and filed on November 17,
    2006, and incorporated herein by reference.)10
.26

Form of Employee Restricted Stock Unit Award Agreement effective
    November 15, 2006 with respect to certain employees and
    executive officers. (Filed as Exhibit 10.2 to Foster
    Wheeler Ltd.s
    Form 8-K,
    dated November 15, 2006 and filed on November 17,
    2006, and incorporated herein by reference.)10
.27

Form of Director Nonqualified Stock Option Agreement effective
    November 15, 2006 with respect to non-employee directors.
    (Filed as Exhibit 10.3 to Foster Wheeler Ltd.s
    Form 8-K,
    dated November 15, 2006 and filed on November 17,
    2006, and incorporated herein by reference.)10
.28

Form of Director Restricted Stock Unit Agreement effective
    November 15, 2006 with respect to non-employee directors.
    (Filed as Exhibit 10.4 to Foster Wheeler Ltd.s
    Form 8-K,
    dated November 15, 2006 and filed on November 17,
    2006, and incorporated herein by reference.)10
.29

Warrant Agreement between Foster Wheeler Ltd. and Mellon
    Investor Services LLC, including forms of warrant certificates.
    (Filed as Exhibit 4.10 to Foster Wheeler Ltd.s
    registration statement on
    Form S-3
    (File
    No. 333-120076),
    filed on October 29, 2004 and incorporated herein by
    reference.)10
.30

Master Guarantee Agreement, dated as of May 25, 2001, by
    and among Foster Wheeler LLC, Foster Wheeler International
    Holdings, Inc. and Foster Wheeler Ltd. (Filed as
    Exhibit 10.9 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended June 29, 2001, and incorporated
    herein by reference.)10
.31

Form of Change of Control Agreement, dated as of May 25,
    2001, and entered into by the Company with executive officers.
    (Filed as Exhibit 10.5 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended June 29, 2001, and incorporated
    herein by reference.)10
.32

Form of Indemnification Agreement for directors and officers of
    the Company and Foster Wheeler Inc., dated as of
    November 3, 2004. (Filed as Exhibit 99.1 to Foster
    Wheeler Ltd.s
    Form 8-K,
    dated November 3, 2004 and filed on November 8, 2004,
    and incorporated herein by reference.)10
.33

Employment Agreement between Foster Wheeler Ltd. and Raymond J.
    Milchovich, dated as of August 11, 2006. (Filed as
    Exhibit 10.1 to Foster Wheeler Ltd.s
    Form 8-K,
    dated August 7, 2006 and filed on August 11, 2006, and
    incorporated herein by reference.)10
.34

First Amendment to the Employment Agreement, dated
    January 30, 2007, between Foster Wheeler Ltd. and Raymond
    J. Milchovich. (Filed as Exhibit 10.2 to Foster Wheeler
    Ltd.s
    Form 8-K,
    dated January 30, 2007 and filed on February 2, 2007,
    and incorporated herein by reference.)10
.35

Second Amendment to the Employment Agreement, dated
    February 27, 2007, between Foster Wheeler Ltd. and Raymond
    J. Milchovich. (Filed as Exhibit 10.1 to Foster Wheeler
    Ltd.s
    Form 8-K,
    dated February 27, 2007 and filed on March 2, 2007,
    and incorporated herein by reference.)10
.36

Stock Option Agreement of Raymond J. Milchovich, dated as of
    October 22, 2001. (Filed as Exhibit 10.13 to Foster
    Wheeler Ltd.s
    Form 10-K
    for the fiscal year ended December 28, 2001, and
    incorporated herein by reference.) 128




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ExhibitNo.

Exhibits10
.37

Employees Restricted Stock Award Agreement of Raymond J.
    Milchovich, dated as of August 11, 2006. (Filed as
    Exhibit 10.2 to Foster Wheeler Ltd.s
    Form 8-K,
    dated August 7, 2006 and filed on August 11, 2006, and
    incorporated herein by reference.)10
.38

Employee Nonqualified Stock Option Agreement of Raymond J.
    Milchovich, dated as of August 11, 2006. (Filed as
    Exhibit 10.3 to Foster Wheeler Ltd.s
    Form 8-K,
    dated August 7, 2006 and filed on August 11, 2006, and
    incorporated herein by reference.)10
.39

Employment Agreement between Foster Wheeler Ltd. and John T.
    La Duc, dated as of April 14, 2004. (Filed as
    Exhibit 99.2 to Foster Wheeler Ltd.s
    Form 8-K,
    dated April 14, 2004 and filed on April 15, 2004, and
    incorporated herein by reference.)10
.40

First Amendment to the Employment Agreement, dated as of
    October 6, 2006, between Foster Wheeler Ltd. and John T.
    La Duc. (Filed as Exhibit 99.1 to Foster Wheeler
    Ltd.s
    Form 8-K,
    dated October 5, 2006 and filed on October 10, 2006,
    and incorporated herein by reference.)10
.41

Second Amendment to the Employment Agreement, dated as of
    January 30, 2007, between Foster Wheeler Ltd. and John T.
    La Duc. (Filed as Exhibit 10.1 to Foster Wheeler
    Ltd.s
    Form 8-K,
    dated January 30, 2007 and filed on February 2, 2007,
    and incorporated herein by reference.)10
.42

Change of Control Employment Agreement between Foster Wheeler
    Inc. and John T. La Duc, dated as of April 14, 2004.
    (Filed as Exhibit 99.3 to Foster Wheeler Ltd.s
    Form 8-K,
    dated April 14, 2004 and filed on April 15, 2004, and
    incorporated herein by reference.)10
.43

Consulting Agreement, dated as of September 1, 2007,
    between Foster Wheeler Inc. and John T. La Duc (Filed as
    Exhibit 10.1 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended September 28, 2007, and incorporated
    herein by reference.)10
.44

Employment Agreement between Foster Wheeler Ltd. and Peter J.
    Ganz, dated as of October 10, 2005. (Filed as
    Exhibit 10.1 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended September 30, 2005, and incorporated
    herein by reference.)10
.45

First Amendment to the Employment Agreement, dated as of
    October 6, 2006, between Foster Wheeler Ltd. and Peter J.
    Ganz. (Filed as Exhibit 99.3 to Foster Wheeler Ltd.s
    Form 8-K,
    dated October 5, 2006 and filed on October 10, 2006,
    and incorporated herein by reference.)10
.46

Change of Control Employment Agreement between Foster Wheeler
    Inc. and Peter J. Ganz, dated as of October 10, 2005.
    (Filed as Exhibit 10.2 to Foster Wheeler Ltd.s
    Form 10-Q
    for the quarter ended September 30, 2005, and incorporated
    herein by reference.)10
.47

Restricted Stock Award Agreement of Peter J. Ganz, dated as of
    October 24, 2005. (Filed as Exhibit 10.3 to Foster
    Wheeler Ltd.s
    Form 10-Q
    for the quarter ended September 30, 2005, and incorporated
    herein by reference.)10
.48

English Translation of Supplemental Employment Agreement,
    effective as of November 12, 2007, among Foster Wheeler
    Continental Europe S.r.L., Foster Wheeler Ltd., and Franco
    Baseotto. (Filed as Exhibit 10.1 to Foster Wheeler
    Ltd.s
    Form 8-K,
    dated November 12, 2007 and filed on November 14,
    2007, and incorporated herein by reference.)10
.49

English Translation of Change of Control Agreement, effective as
    of November 12, 2007, among Foster Wheeler Continental
    Europe S.r.L., Foster Wheeler Ltd., and Franco Baseotto. (Filed
    as Exhibit 10.2 to Foster Wheeler Ltd.s
    Form 8-K,
    dated November 12, 2007 and filed on November 14,
    2007, and incorporated herein by reference.)21
.0

Subsidiaries of the Registrant.23
.0

Consent of Independent Registered Public Accounting Firm.31
.1

Certification pursuant to Section 302 of the Sarbanes-Oxley
    Act of 2002 of Raymond J. Milchovich.31
.2

Certification pursuant to Section 302 of the Sarbanes-Oxley
    Act of 2002 of Franco Baseotto.32
.1

Certification pursuant to 18 U.S.C. Section 1350, as
    adopted pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002 of Raymond J. Milchovich.32
.2

Certification pursuant to 18 U.S.C. Section 1350, as
    adopted pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002 of Franco Baseotto.  129




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SIGNATURES
       By:
    /s/  Franco
    Baseotto  Franco Baseotto
 
     Signature

Title/s/  Raymond
    J. MilchovichRaymond
    J. Milchovich
    (Principal Executive Officer)

Director, Chairman of the Board and Chief Executive Officer/s/  Franco
    BaseottoFranco
    Baseotto
    (Principal Financial Officer)

Executive Vice President, Chief Financial Officer and Treasurer/s/  Lisa
    Z. WoodLisa
    Z. Wood
    (Principal Accounting Officer)

Vice President and Controller/s/  Eugene
    D. AtkinsonEugene
    D. Atkinson

Director/s/  Diane
    C. CreelDiane
    C. Creel

Director/s/  Steven
    J. DemetriouSteven
    J. Demetriou

Director/s/  Jack
    A. FuscoJack
    A. Fusco

Director/s/  Robert
    C. FlexonRobert
    C. Flexon

Director/s/  Edward
    G. GalanteEdward
    G. Galante

Director/s/  Stephanie
    Hanbury-BrownStephanie
    Hanbury-Brown

Director/s/  James
    D. WoodsJames
    D. Woods

Director  130